Exhibit 10.1
This
Agreement (this “
Agreement”) is made as of this 20th day of January, 2011 by and between
Black Box Corporation, a Delaware corporation (the “Corporation”), and Xxxxxxx X. Xxxxx, an
individual residing in the Commonwealth of
Pennsylvania and an executive of the Corporation (the
“Executive”).
WITNESSETH:
WHEREAS, the Board of Directors of the Corporation has determined that it is in the best
interests of the Corporation to enter into an
agreement with the Executive providing for certain
payments and benefits to the Executive.
NOW, THEREFORE, the parties hereto, each intending to be legally bound hereby, agree as
follows:
| 1. |
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Definition of Terms. The following terms when used in this Agreement shall have the
meaning hereafter set forth: |
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(a) |
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“Annual Salary Adjustment Percentage” shall mean the mean average percentage
increase in base salary for all executive officers of the Corporation during the two
full calendar years immediately preceding the time to which such percentage is being
applied; provided, however, that if after a Change-in-Control, as hereinafter defined,
there should be a significant change in the number of executive officers of the
Corporation or in the manner in which they are compensated, then the foregoing
definition shall be changed by substituting for the phrase “executive officers of the
Corporation” the phrase “persons then performing the functions formerly performed by
the executive officers of the Corporation.” |
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(b) |
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“Cause for Termination” shall mean: |
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(i) |
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the deliberate and intentional failure by the Executive to
devote substantially the Executive’s entire business time and best efforts to
the performance of the Executive’s duties (other than any such failure
resulting from the Executive’s incapacity due to physical or mental illness or
disability); |
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or |
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(ii) |
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engaging by the Executive in gross misconduct materially and
demonstrably injurious to the Corporation; |
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or |
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(iii) |
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the conviction .of the Executive of, or the entry of a plea of
guilty or Nolo Contendre by the Executive to, a crime involving an act of fraud
or embezzlement against the Corporation or the conviction of the Executive
of, or the entry of a plea of Nolo Contendre by the Executive to, any felony
involving moral turpitude; |
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or |
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(iv) |
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the Executive’s material breach of Section 4 or Section 8
hereof which continues for ten (10) days after receiving written notice thereof
from, the Corporation or the Executive’s willful failure to comply with
instructions of the Board of Directors of the Corporation provided that such
instructions would not give rise to Good Reason for Termination. |
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For purposes of this definition, no act, or failure to act, on the Executive’s part
shall be considered “deliberate and intentional” or to constitute gross misconduct
unless done, or omitted to be done, by the Executive not in good faith and without
reasonable belief that the Executive’s action or omission was in the best interests
of the Corporation. |
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(c) |
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“Change-in-Control” shall mean a change in control of the Corporation of such a
nature that it would be required to be reported by the Corporation in response to Item
6(e) of Schedule 14A of Regulation 14A promulgated under the Securities Exchange Act of
1934, as in effect on the date hereof (“Exchange Act”); provided, however, that: |
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(i) |
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without respect to the foregoing, such a change in control
shall be deemed to have occurred if any “person” (as such term is used in
sections 13(d) and 14(d)(2) of the Exchange Act) or any “group” (as such term
is defined in Rule 13d-5(b) promulgated under the Exchange Act), is or becomes
the beneficial owner, directly or indirectly, of securities of the Corporation
representing twenty percent (20%) or more of the combined voting power of the
Corporation’s then outstanding securities coupled with or followed by the
existence of a majority of the board of directors of the Corporation consisting
of individuals other than individuals who either were directors of the
Corporation at least one year prior to or were nominated by those individuals
who were directors of the Corporation at least one year prior to such person or
group becoming a beneficial owner, directly or indirectly, of securities of the
Corporation representing 20% or more of the combined voting power of the
Corporation’s then outstanding securities; |
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and |
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(ii) |
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without respect to the foregoing, if the Corporation shall sell
all or substantially all of its assets or shall merge, consolidate or
reorganize with another company, then such a change in control shall be deemed
to have occurred if (x) upon conclusion of the transaction less than fifty-one
percent (51%) of the outstanding securities entitled to vote generally in the
election of directors of the acquiring company or resulting company are owned
by persons who were the stockholders of the Corporation generally prior to |
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the transaction and following the transaction a majority of the board of
directors of the acquiring company or resulting company consists of
individuals other than individuals who either were directors of the
Corporation at least one year prior to or were nominated by those
individuals who were directors of the Corporation at least one year prior to
such sale, merger, consolidation or reorganization or (y) following the
transaction a person or group (as described in subclause (i) above) would be
a beneficial owner, directly or indirectly, of securities of the acquiring
company or resulting company representing 20% or more of the combined voting
power of the acquiring company’s or resulting company’s then outstanding
securities as described in subclause (i) above and a majority of the board
of directors of the acquiring company or resulting company consists of
individuals other than individuals who either were directors of the
Corporation at least one year prior to or were nominated by those
individuals who were directors of the Corporation at least one year prior to
such sale, merger, consolidation or reorganization. |
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(d) |
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“Date of Termination” shall mean: |
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(i) |
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if the Executive’s employment is terminated for Disability, the
date that a Notice of Termination is given to the Executive; |
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(ii) |
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if the Executive’s employment terminates due to the Executive’s
death or Retirement, the date of death or Retirement, respectively; |
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(iii) |
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if the Executive decides to terminate employment upon Good
Reason for Termination, the date specified by the Executive in a Notice of
Termination, which date must be within sixty (60) days after the expiration of
the Notice Period (as defined in Section 3(c) below); or |
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(iv) |
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if the Executive’s employment is terminated for any other
reason, the date on which a termination becomes effective pursuant to a Notice
of Termination or, if no Notice of Termination is provided, the date that the
Executive’s employment was terminated. |
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(e) |
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“Disability” shall mean such incapacity due to physical or mental illness or
injury as causes the Executive to be unable to perform the Executive’s duties with the
Corporation during 90 consecutive days or 120 days during any six month period. |
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(f) |
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“Good Reason for Termination” shall mean a material negative change in the
Executive’s service relationship with the Corporation and any Affiliate (as defined in
this Section 1(f) below) of the Corporation, taken as a whole, without Executive’s
consent, on account of one or more of the following conditions: |
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(i) |
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A material diminution in Executive’s base compensation; |
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(ii) |
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A material diminution in Executive’s authority, duties or
responsibilities; or |
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(iii) |
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A change in the geographic location at which Executive must
report to and perform the majority of Executive’s services of more than fifty
(50) miles. |
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“Affiliate” shall mean, with respect to any person or legal entity, any
other person or legal entity controlling, controlled by or under common
control with such person or legal entity. |
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(g) |
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“LTIP Plan” shall mean an incentive compensation plan of the Corporation which
would pay bonuses to the Executive based upon the achievement of specified goals during
or at the end of an award period of more than one year (such as a three year incentive
compensation plan). |
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(h) |
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“Notice of Termination” shall mean a written statement which sets forth the
specific reason for termination and, if such is claimed to be Cause for Termination or
Good Reason for Termination, in reasonable detail the facts and circumstances thereof. |
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(i) |
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“Options” shall mean any stock options issued pursuant to any present or future
stock option plan of the Corporation. |
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(j) |
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“Retirement” shall mean a termination of the Executive’s employment after age
65 or in accordance with any mandatory retirement arrangement with respect to an
earlier age agreed to by the Executive. |
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(k) |
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“Stock Awards” shall mean any stock-based awards, other than Options, including
any stock appreciation rights, restricted stock awards, or performance stock awards,
issued pursuant to any present or future stock plan of the Corporation. |
| 2. |
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Termination by the Corporation Due to Cause for Termination. Should the Board of
Directors of the Corporation determine that Cause for Termination exists, the Board of
Directors of the Corporation by resolution duly adopted may at that time or during a period of
two months thereafter terminate the Executive’s employment due to Cause for Termination by
delivering a Notice of Termination. If the Board of Directors of the Corporation fails to
duly adopt within such two month period a resolution terminating the Executive’s employment,
then the Corporation shall be deemed to have waived its right to terminate the Executive due
to those circumstances which constituted the Cause for Termination previously found to exist
by the Board. |
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| 3. |
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Payments Following Termination of Employment After Change-in-Control. |
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(a) |
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If during the term of this Agreement the Executive’s employment with the
Corporation shall be terminated: |
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(i) |
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due to the Executive’s death or Disability, |
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(ii) |
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by the Executive at any time prior to a Change-in-Control, |
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(iii) |
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by the Executive following a Change-in-Control other than the
Executive’s having terminated for Good Reason for Termination, |
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(iv) |
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by the Corporation at any time prior to a Change-in-Control, or |
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(v) |
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by the Corporation following a Change-in-Control in accordance
with Section 2 hereof or in accordance with Retirement, |
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then the Corporation shall have no obligations hereunder to the Executive from and
after the Date of Termination and the only obligations of the Corporation to the
Executive shall be in accordance with any other employment agreement applicable to
the Executive and the then various policies, practices and benefit plans of the
Corporation. |
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(b) |
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If during the term of this Agreement a Change-in-Control shall have occurred
and the Executive’s employment shall have been involuntarily terminated on or before
the second anniversary of the date of the Change-in-Control other than under the
circumstances above described in subsection 3(a) (for example, a termination by the
Executive for Good Reason for Termination within the foregoing period following a
Change-in-Control shall entitle the Executive to the payments set forth in this
subsection), then the Corporation shall pay the Executive on or before the sixtieth
{60th) day following the Date of Termination the following sums: |
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(i) |
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in cash any unpaid portion of the Executive’s full base salary
for the period from the last period for which the Executive was paid to the
Date of Termination; and |
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(ii) |
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an amount in cash as liquidated damages for lost future
remuneration equal to the sum of |
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(A) |
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the product obtained by multiplying: |
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(i) |
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two (2.0), or |
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(ii) |
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a number equal to
the number of calendar months remaining from the Date of
Termination to the date on which the Executive is 65
years of age (or, if earlier, the age agreed to by the
Executive pursuant to any prior arrangement) divided by
twelve, |
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(x) |
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the Executive’s annual base salary for the year
in effect on the Date of Termination, |
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(y) |
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in the case of termination by the Executive for
Good Reason for Termination, the Executive’s
annual base salary in effect on the date
immediately preceding the date of the earliest
event which gave rise to the termination by the
Executive for Good Reason for Termination, |
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(z) |
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the Executive’s annual base salary for the year
in effect on the date of the Change-in-Control, |
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(x) |
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one third (1/3) of the aggregate cash bonuses or
awards (including any payments under an LTIP
Plan) received by the Executive as incentive
compensation or bonus during the three calendar
years immediately preceding the Date of
Termination, |
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(y) |
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in the case of termination by the Executive for
Good Reason for Termination, one third (1/3) of
the aggregate cash bonuses or awards (including
any payments under an LTIP Plan) received by the
Executive as incentive compensation or bonus
during the three calendar years immediately
preceding the date of the earliest event which
gave rise to the termination by the Executive
for Good Reason for Termination, |
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(z) |
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one third (1/3) of the aggregate cash bonuses or
awards (including any payments under an LTIP
Plan) received by the Executive as incentive
compensation or bonus for the three calendar
years immediately preceding the date of the
Change-in-Control, |
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(B) |
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if the Executive immediately preceding the date
of the Change-in-Control is a participant in an LTIP Plan and the award
period has not been completed prior to the date of the
Change-in-Control, an amount equal to |
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(1) |
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the total cash award or bonus
which would have been received by the Executive under such LTIP
Plan assuming that, in addition to any goals met on or before
the date of the Change-in-Control, all goals that were to be
measured after the date of the Change-in-Control were achieved
and the Executive remained in the employ of the Corporation at
all relevant times under the LTIP Plan, |
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(2) |
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any portion of the cash award or
bonus for that award period previously paid to the Executive
pursuant to such LTIP Plan. |
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(c) |
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In order for the Executive to terminate for Good Reason for Termination under
this Agreement, (i) the Executive must deliver a Notice of Termination to the
Corporation at 0000 Xxxx Xxxxx, Xxxxxxxx, XX 00000, Attn: General Counsel, and within
ninety (90) days of the event constituting Good Reason for Termination, (ii) the event
must remain uncorrected during the Notice Period and (iii) the Date of Termination must
occur within sixty (60) days after the expiration of the Notice Period, “Notice Period”
means the thirty (30) days following the date that Executive notifies the Corporation
in writing of Executive’s intent to terminate employment for Good Reason for
Termination. |
| 4. |
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Nondisclosure of Information. |
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(a) |
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Executive acknowledges that the Corporation has invested and will continue to
invest considerable resources in the research, development and advancement of the
Corporation’s business, which investment has or may result in the generation of
proprietary, confidential and/or trade secret data, information, techniques and
materials, tangible and intangible, which properly belong to the Corporation or in
which the Corporation has an interest. Executive acknowledges and agrees that it would
be unlawful for Executive to appropriate, to attempt to appropriate, or to disclose to
anyone or use for a third party’s benefit such data, information, techniques or
materials, subject to the following: |
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(i) |
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Executive acknowledges that the following constitute
protectable confidential, trade secret or otherwise proprietary information of
the Corporation or of a third party: all computer software and firmware and
computer aided mechanisms related to the foregoing, files, programs, data or
information received by the Corporation from a customer or prospective customer
of the Corporation if such is confidential or proprietary to the |
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customer, data base management systems or other instrumentations, any
proposals for development, any reports on findings of tests, investigative
studies, consultations or the like, pricing policies, budgets, customer
lists, strategic plans (whether or not communicated in writing), marketing
and sales information, all written documents not generally in the public
domain, any and all copies or imitations of the foregoing, and all other
confidential, trade secret or proprietary information, whether or not
copyrighted or patented and whether created solely by Executive, jointly
with others, or solely by others. |
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(ii) |
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For purposes of this Section 4, all confidential, proprietary,
or trade secret information enumerated or mentioned in Section 4(a)(i) is
hereinafter referred to as “Information”. Any restrictions on disclosure and
use of the Information will apply to all copies of the Information, whether in
whole or in part. |
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(iii) |
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During the term of this Agreement and at all times after
termination of this Agreement, unless authorized in writing by the Corporation,
the Executive will not: |
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(1) |
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use for the Executive’s benefit or advantage
the Information, or |
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(2) |
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use the Information for the benefit or
advantage of any third party, or |
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(3) |
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disclose or cause to be disclosed the
Information or authorize or permit such disclosure of the Information
to any unauthorized third party, or |
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(4) |
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use the Information in any manner which is
intended to injure or cause loss, whether directly or indirectly, to
the Corporation. |
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(iv) |
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The Executive will not be liable for the disclosure of
Information which: |
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(1) |
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is in the public domain generally and as such
becomes known to Executive through no wrongful act or breach of this
Agreement; or |
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(2) |
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is received rightfully by Executive from a
third party having a lawful right to possess and to release the
Information, provided the Executive agrees to promptly notify the
Corporation if the Executive suspects that the information possessed by
the third party is within the meaning of Information under this
Agreement. |
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(v) |
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In any judicial proceeding, it will be presumed that the
Information constitutes protectable trade secrets, and the Executive will bear
the burden of proving that any Information is publicly or rightfully known by
the Executive. |
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(vi) |
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The Executive will surrender to the Corporation at any time
upon request, and upon termination of the Executive’s employment with the
Corporation for any reason, all written or otherwise tangible documentation
representing or embodying the Information, in whatever form, whether or not
copyrighted, patented, or protected as a mask work, and any copies or
imitations of the Information, whether or not made by the Executive. |
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(vii) |
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The Executive agrees to be available upon request for
consultation after termination of employment to provide information and details
with respect to any work or activity performed or materials created by the
Executive alone or with others during the Executive’s employment by the
Corporation. The Executive will be reimbursed for these services. |
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(b) |
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Any and all creations, developments, discoveries, inventions, works of
authorship, enhancements, modifications and improvements, including without limitation
computer programs, data bases, data files and the like, (hereinafter collectively
referred to as “Development” or “Developments”), whether or not the Developments are
copyrightable, patentable, protectable as mask works or otherwise protectable (such as
by contract or implied duty), and whether published or unpublished, conceived,
invented, developed, created or produced by the Executive alone or with others during
the term of the Executive’s employment, whether or not during working hours and whether
on the Corporation’s premises or elsewhere, will be the sole and exclusive property of
the Corporation if the Development is: |
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(i) |
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connected with the Corporation in any way, or |
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(ii) |
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within the scope of the Executive’s duties assigned or implied
in accordance with the Executive’s position, or |
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(iii) |
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a product, service, or other item which would be in
competition with the products or services offered by the Corporation or which
is related to the Corporation’s products or services, whether presently
existing, under development, or under active consideration, or |
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(iv) |
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in whole or in part, the result of the Executive’s use of the
Corporation’s resources, including without limitation personnel, computers,
data bases, communications facilities, word processing systems, programs,
office facilities or otherwise. |
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During the term of the Executive’s employment with the Corporation and, if the
Corporation should then so request, after termination of such employment, the
Executive agrees to assign and does hereby assign to the Corporation all rights in
the Developments created by the Executive alone or with others during the term of
the Executive’s employment, and all rights in any trademarks, copyrights, patents,
trade secrets and analogous intellectual property rights and any applications for
registration for same, of the United States and such foreign countries as the
Corporation may designate which are related to the Developments, |
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including without limitation all accompanying goodwill and the right to xxx for
infringement or misappropriation and to receive all proceeds related to any judgment
or settlement of same. The Executive agrees to execute and deliver to the
Corporation any instruments the Corporation deems necessary to vest in the
Corporation sole title to and all exclusive rights in the Developments created by
the Executive alone or with others during the term of the Executive’s employment,
and in all related trademarks, copyrights, mask work protection rights, and/or
patent rights so created during the term of employment. The Executive agrees to
execute and deliver to the Corporation all proper papers for use in applying for,
obtaining, maintaining, amending and enforcing all such trademarks, copyrights,
patents or such other legal protections as the Corporation may desire. The
Executive further agrees to assist fully the Corporation or its nominees in the
preparation and prosecution of any trademark, copyright, mask work protection,
patent, or trade secret arbitration or litigation. The Executive shall be
reimbursed on a reasonable hourly basis consistent with the compensation provided
for herein for the Executive’s services rendered following termination of
employment. |
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(c) |
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The Executive’s obligations and covenants in this Section 4 will be binding
upon the Executive’s heirs, legal representatives, successors and assigns. |
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(d) |
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The Corporation and the Executive agree that the rights conveyed by this
Agreement are of a unique and special nature. The Executive and the Corporation agree
that any violation of this Section 4 will result in immediate and irreparable harm to
the Corporation and that in the event of any actual or threatened breach or violation
of any of the provisions of this Section 4, the Corporation will be entitled as a
matter of right to an injunction or a decree of specific performance without bond from
any equity court of competent jurisdiction. The Executive waives the right to assert
the defense that such breach or violation can be compensated adequately in damages in
an action at law. Nothing in this Agreement will be construed as prohibiting the
Corporation from pursuing any other remedies at law or in equity available to it for
such breach or violation or threatened violation. |
| 5. |
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Medical Insurance or Similar Benefit Plans. If the Executive’s employment should
terminate under such circumstance as entitles the Executive to receive payments pursuant to
Section 3(b) hereof, then, to the extent permitted by applicable law and the medical insurance
and benefits policies to which Executive is entitled to participate. Employer shall maintain
Executive’s paid coverage for health insurance (through the payment of Executive’s COBRA (as
defined below) premiums) until the earlier to occur of: (a) Executive attaining the age of
65, (b) the date Executive is provided by another employer benefits substantially comparable
to the benefits provided by the above-referenced medical plan (which Executive must provide
prompt notice with respect thereto to the Employer) or (c) the expiration of the COBRA
Continuation Period (as defined below). During the applicable period of coverage described in
the foregoing sentence, Executive shall be entitled to benefits, on substantially the same
basis as would have otherwise been provided had Executive not been terminated and Employer
will have no obligation to pay any benefits to, or premiums on behalf of Executive after such
period ends. To the extent that such benefits are available under the above-referenced
medical plan and Executive had such coverage immediately prior to |
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termination of employment, such continuation of benefits for Executive shall also cover
Executive’s dependents for so long as Executive is receiving benefits under this section.
The COBRA Continuation Period for medical insurance under this section shall be deemed to
run concurrently with the continuation period federally mandated by COBRA (generally 18
months), or any other legally mandated and applicable federal, state, or local coverage
period for benefits provided to terminated employees under the medical plan. For purposes
of this Agreement, (a) “COBRA” means the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended, and (b) “COBRA Continuation Period” shall mean the continuation period for
medical insurance to be provided under the terms of this Agreement which shall commence on
the first day of the calendar month following the month in which the date of termination
falls and generally shall continue for an 18 month period. |
| 6. |
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Other Employment. In the event of a termination of employment under the
circumstances above described in Section 3(b) hereof, the Executive shall have no duty to seek
any other employment after termination of the Executive’s employment with the Corporation and
the Corporation hereby waives and agrees not to raise or use any defense based on the position
that the Executive had a duty to mitigate or reduce the amounts due the Executive hereunder by
seeking other employment whether suitable or unsuitable and should the Executive obtain other
employment, then the only effect of such on the obligations of the Corporation hereunder shall
be that the Corporation shall be entitled to credit against any payments which would otherwise
be made pursuant to Sections 5(a) or 5(b) hereof, any comparable payments to which the
Executive is entitled under the employee benefit plans maintained by the Executive’s other
employer or employers in connection with services to such employer or employers after
termination of the Executive’s employment with the Corporation. |
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| 7. |
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Stock Awards and Options. If the Executive’s employment should terminate under the
circumstances described in Section 3(a) hereof, the Executive’s rights, if any, with respect
to any outstanding Stock Awards and/or Options shall be governed by the plans and any related
agreements pursuant to which such Stock Awards and/or Options were granted. If the
Executive’s employment should terminate under such circumstances as entitle the Executive to
receive payments pursuant to Section 3(b) hereof, then, with respect to each outstanding
Option or Stock Award which did not immediately vest and/or become exercisable upon the
occurrence of a Change-in-Control, such Stock Award or Option shall remain outstanding in
accordance with its terms provided that in any event it shall automatically vest upon
termination of employment and/or become and remain exercisable at any time after termination
of employment until the stated expiration date contained in the grant for such Stock Award or
Option, provided that the expiration date of any such Option or Stock Award may not exceed ten
years from the date of grant. |
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| 8. |
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Noncompetition. During the period of employment of Executive by the Corporation and
for five (5) years thereafter, the Executive will not, in any geographic area in which the
Corporation is offering its services and products, without the prior written consent of the
Corporation: |
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(a) |
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directly or indirectly engage in, |
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(b) |
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assist or have an active interest in (whether as proprietor, partner, investor,
shareholder, officer, director or any type of principal whatsoever), or |
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(c) |
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enter the employ of, or act as agent for, or advisor or consultant to, any
person, firm, partnership, association, corporation or business organization, entity or
enterprise which is or is about to become directly or indirectly engaged in, |
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any business which is competitive with any business of the Corporation or any subsidiary or
affiliate thereof in which Executive is or was engaged; provided, however, that the
foregoing provisions of this paragraph 8 are not intended to prohibit and shall not prohibit
Executive from purchasing, for investment, not in excess of 1% of any class of stock or
other corporate security of any company which is registered pursuant to Section 12 of the
Securities Exchange Act of 1934. |
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Executive acknowledges that the breach by the Executive of the provisions of this Section 8
would cause irreparable injury to the Corporation, acknowledges and agrees that remedies at
law for any such breach will be inadequate and consents and agrees that the Corporation
shall be entitled, without the necessity of proof of actual damage, to injunctive relief in
any proceedings which maybe brought to enforce the provisions of this Section 8. Executive
acknowledges and warrants that the Executive will be fully able to earn an adequate
livelihood for the Executive and the Executive’s dependents if this Section 8 should be
specifically enforced against the Executive and that such enforcement will not impair the
Executive’s ability to obtain employment commensurate with the Executive’s abilities and
fully acceptable to the Executive. |
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If the scope of any restriction contained in this Section 8 is too broad to permit
enforcement of such restriction to its full extent, then such restriction shall be enforced
to the maximum extent permitted by law and Executive and the Corporation hereby consent and
agree that such scope may be judicially modified in any proceeding brought to enforce such
restriction. |
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| 9. |
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Terms. This Agreement shall be for an initial term of five years commencing on the
date hereof. This Agreement shall automatically renew for an additional term of one year
commencing on the fifth anniversary of the date hereof and for succeeding additional terms
each of one year on each succeeding anniversary thereof until and unless either party sends
written notice of non-renewal to the other party at least six months prior to a renewal date;
provided, however, that if a Change-in-Control shall occur during the initial or renewed term
of this Agreement, then this Agreement shall remain in effect until the second anniversary of
the date of the Change-in-Control. |
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| 10. |
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Miscellaneous. |
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(a) |
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This Agreement shall be construed under the laws of the Commonwealth of
Pennsylvania. |
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(b) |
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This Agreement constitutes the entire understanding of the parties hereto with
respect to the subject matter hereof and may only be amended or modified by written
agreement signed by the parties hereto. The parties acknowledge and agree
that this Agreement supersedes, amends and restates in its entirety, renders null
and void and terminates that certain Severance Agreement by and between the parties
dated December 28, 2007. |
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(c) |
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The Corporation will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Corporation, by agreement in form and substance
satisfactory to the Executive, to expressly assume and agree to perform this Agreement
in the same manner required of the Corporation and to perform it as if no such
succession had taken place. Failure of the Corporation to obtain such agreement prior
to the effectiveness of any such succession shall be a breach of this Agreement and
shall entitle the Executive to terminate employment due to Good Reason for Termination.
As used in this Agreement, “Corporation” shall mean the Corporation as hereinbefore
defined and any successor to its business and/or assets as aforesaid which executes and
delivers the agreement provided for in this subsection (c) or which otherwise becomes
bound by all the terms and provisions of this Agreement by operation of law. |
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(d) |
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This Agreement shall inure to the benefit of and be enforceable by the
Executive and the Corporation and their respective legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If the
Executive should die while any amounts would still be payable to the Executive
hereunder if the Executive had continued to live, all such amounts, unless otherwise
provided herein, shall be paid in accordance with the terms of this Agreement to the
Executive’s devisee, legatee or other designee or, if there be no such designee, to the
Executive’s estate. |
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(e) |
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Any notice or other communication provided for in this Agreement shall be in
writing and, unless otherwise expressly stated herein, shall be deemed to have been
duly given if mailed by United States registered mail, return receipt requested,
postage prepaid, addressed in the case of the Executive to the Executive’s office at
the Corporation with a copy to the Executive’s residence and in the case of the
Corporation to its principal executive offices, attention of the Chief Executive
Officer. |
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(f) |
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No provisions of this Agreement may be modified, waived or discharged unless
such waiver, modification or discharge is agreed to in writing signed by the Executive
and approved by resolution of the Board of Directors of the Corporation. No waiver by
either party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed by such
other party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time. No agreements or representations, oral
or otherwise, express or implied, with respect to the subject matter hereof have been
made by either party which are not set forth expressly in this Agreement. Nothing
contained herein shall impair the right of the Corporation to terminate the Executive’s
employment, subject to making any payments required to be made hereunder. |
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(g) |
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The invalidity or unenforceability of any provisions of this Agreement shall
not affect the validity or enforceability of any other provision of this Agreement,
which shall remain in full force and effect. |
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(h) |
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This Agreement may be executed in one or more counterparts, each of which shall
be deemed to be an original but all of which together will constitute one and the same
instrument. |
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(i) |
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If litigation should be brought to enforce interpret or challenge any provision
contained herein, the prevailing party in such litigation, if any, shall be entitled to
its reasonable attorney’s fees and disbursements and other costs incurred in such
litigation and to interest on any money judgment obtained calculated at the prime rate
of interest in effect from time to time at Citizen’s Bank, N.A. (or its successor),
from the date that the payment should have been made under this Agreement. |
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(j) |
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Excise Taxes. |
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(i) |
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For purposes of this subsection 10(j), (1) a Payment shall mean
any payment or distribution in the nature of compensation to or for the benefit
of the Executive, whether paid or payable pursuant to this Agreement or
otherwise; (2) Agreement Payment shall mean a Payment paid or payable pursuant
to this Agreement (disregarding this subsection 10(j)); (3) Net After Tax
Receipts shall mean the Present Value of a Payment net of all taxes imposed on
the Executive with respect thereto under Sections 1 and 4999 of the Internal
Revenue Code of 1986, as amended (the “Code”)determined by applying the highest
marginal rate under Section 1 of the Code applicable to the Executive’s taxable
income for such year; (4) “Present Value” shall mean such value determined in
accordance with Section 280G(d)(4) of the Code; and (5) “Reduced Amount” shall
mean the greatest aggregate amount of Payments, if any, which (x) is less than
the sum of all Payments and (y) results in aggregate Net After Tax Receipts
which are greater than the Net After Tax Receipts which would result if the
aggregate Payments were made. |
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(ii) |
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Anything in this Agreement to the contrary notwithstanding, in
the event PriceWaterhouseCoopers L.L.P. (or if PriceWaterhouseCoopers L.L.P. is
the audit firm for the Corporation at the time, another accounting firm of
nationally recognized standing selected by Executive) (the “Accounting Firm”)
shall determine that receipt of all Payments would subject the Executive to tax
under Section 4999 of the Code, it shall determine whether some amount of
Payments would meet the definition of a “Reduced Amount.” If the Accounting
Firm determines that there is a Reduced Amount, the aggregate Agreement
Payments shall be reduced to such Reduced Amount; provided, however, that if
the Reduced Amount exceeds the aggregate Agreement Payments, the aggregate
Payments shall, after the reduction of all Agreement Payments, be reduced (but
not below zero) in the amount of such excess. All determinations made by the
Accounting Firm under this Section shall be binding upon the Corporation and the
Executive and shall be made within 60 days of the occurrence of an event
which requires the Corporation to make payments to the Executive under this
Agreement. No later than two
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business days following the making of this
determination by the Accounting Firm, the Corporation shall pay to or
distribute for the benefit of the Executive such Payments as are then due to
the Executive under this Agreement and shall promptly pay to or distribute
for the benefit of the Executive in the future such Payments as become due
to the Executive under this Agreement. The Corporation or its successor
shall pay for the work done by the Accounting Firm. In the event that the
Accounting Firm is unable or unwilling to make the determinations to be made
under this subsection 10(j) or for any reason such determinations are not
made within 60 days of the occurrence of the event which requires the
Corporation to make payments to the Executive under this Agreement, the
Corporation shall make all Payments as are then due to the Executive without
reduction no later than two business days following the 60th day after the
occurrence of the event which required the Corporation to make payments to
the Executive under this Agreement. |
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(iii) |
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While it is the intention of the Corporation and the Executive
to reduce the amounts payable or distributable to the Executive hereunder only
if the aggregate Net After Tax Receipts to the Executive would thereby be
increased, as a result of the uncertainty in the application of Section 4999 of
the Code at the time of the initial determination by the Accounting Firm
hereunder, it is possible that amounts will have been paid or distributed by
the Corporation to or for the benefit of the Executive pursuant to this
Agreement which should not have been so paid or distributed (“Overpayments”) or
that additional amounts which will not have been paid or distributed by the
Corporation to or for the benefit of the Executive pursuant to this Agreement
could have been so paid or distributed (“Underpayment”), in each case,
consistent with the calculation of the Reduced Amount hereunder. In the event
that the Accounting Firm, based either upon the assertion of a deficiency by
the Internal Revenue Service against the Corporation or the Executive which the
Accounting Firm believes has a high probability of success or controlling
precedent or other substantial authority, determines that an Overpayment has
been made, any such Overpayment paid or distributed by the Corporation to or
for the benefit of the Executive shall be treated for all purposes as a loan ab
initio to the Executive which the Executive shall repay to the Corporation
together with interest at the applicable federal rate provided for in Section
7872(f)(2) of the Code; provided, however, that no such loan shall be deemed to
have been made and no amount shall be payable by the Executive to the
Corporation if and to the extent such deemed loan and payment would not either
reduce the amount on which the Executive is subject to tax under Section 1 and
Section 4999 of the Code or generate a refund of such taxes. In the event that
the Accounting Finn, based upon controlling precedent or other substantial
authority, determines that an Underpayment has occurred,
any such Underpayment shall be promptly paid by the Corporation to or for
the benefit of the Executive together with interest at the applicable
federal rate provided for in Section 7872(f)(2) of the Code. |
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(k) |
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The payments to be made under this Agreement are intended to be excepted from
coverage under Section 409A (“Section 409A”) of the Code and the regulations
promulgated thereunder and shall be construed accordingly. If the Corporation
determines in good faith that any amounts to be paid to Executive under this Agreement
are subject to Section 409A, the Corporation shall adjust or cause its Affiliate to
adjust the form and/or the timing of such payments as determined to be necessary or
advisable to be in compliance with Section 409A. If any payment must be delayed to
comply with Section 409A, such payment will be paid at the earliest practicable date
permitted by Section 409A. Notwithstanding any provision to the contrary, to the
extent that any amounts payable hereunder are subject to the requirements of Section
409A and are payable on account of termination of employment, the payment of said
amounts will be delayed for a period of six (6) months after the termination date (or,
if earlier, the death of the Participant) for any Participant that is a “specified
employee” (as defined in Section 409A). Any payment that would otherwise have been due
or owing during such six-month period will be paid immediately following the end of the
six-month period. Notwithstanding any provision of this Agreement to the contrary,
Executive acknowledges and agrees that the Corporation and any Affiliate of the
Corporation shall not be liable for, and nothing provided or contained in this
Agreement will be construed to obligate or cause the Corporation or any Affiliate of
the Corporation to be liable for, any tax, interest or penalties imposed on Executive
related to or arising with respect to any violation of Section 409A. |
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IN WITNESS WHEREOF, this Agreement has been executed on the date first above written.
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BLACK BOX CORPORATION |
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By:
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/s/ Xxxxx Xxxx
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By:
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/s/ Xxxxx Xxxxxxxxx |
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Title: Chief Executive Officer & President |
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| /s/ Xxxxxx Xxxxxxxxx |
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/s/ Xxxxxxx X. Xxxxx |
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Xxxxxxx X. Xxxxx |
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