Salary Continuation Agreement
Exhibit 10.20
This Salary Continuation Agreement (the “Agreement”) is made as of the 10th day of August, 2004 (the “Effective Date”), by and between Xxxxxxxxx Electronics, Inc., a Delaware corporation (“Employer”), a wholly-owned subsidiary of Stratos International, Inc. (“Parent”), and the employee whose name appears on the signature page of this Agreement (“Employee”).
WHEREAS, Employee and Employer are currently parties to that certain Salary Continuation Agreement dated as of October 18, 2000, as amended (the “Prior Continuation Agreement”) and that certain Confidentiality and Noncompete Agreement, effective as of November 3, 1997 (the “Employment Agreement”);
NOW, THEREFORE, the parties agree as follows:
(a) If a Change of Control (as defined below) occurs and Employee’s employment with Employer or its successors, assigns or affiliates is terminated by the Employer and its successors, assigns and affiliates in anticipation of or within 12 months after the consummation of the Change of Control, then Employer agrees to continue to pay Employee his or her base salary (as of the consummation of the Change of Control) for the period commencing on the Change of Control and continuing until the one-year anniversary of the Change of Control (such payments, the “Severance Payments”). Any Severance Payments by Employer pursuant to this Section 1 shall be paid on Employer’s regular salary payment dates or such earlier date as Employer shall determine.
(b) If Employee dies following a Change of Control, Employee’s estate or heirs will be entitled to receive any payments that would otherwise have been paid to Employee pursuant to this Section 1 upon termination of Employee’s employment by Employer.
(c) For purposes of this Agreement, The term “Change of Control” means the occurrence of any of the following events: (i) Any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) becomes the “beneficial owner” (as defined in Rule 13d-3 under said Act), directly or indirectly, of Parent securities representing fifty percent (50%) or more of the total voting power represented by Parent’s then outstanding voting securities; or (ii) The consummation of the sale or disposition by Parent of all or substantially all Parent’s assets; or (iii) The consummation of a merger or consolidation of Parent with any other corporation, other than a merger or consolidation which would result in Parent’s voting securities outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its parent) at least fifty percent (50%) of the total voting power represented by Parent’s voting securities or such surviving entity or its parent outstanding immediately after such merger or consolidation; or (iv) A change in the composition of the Board of Directors of Parent occurring within a two-year period, as a result of which fewer than a majority of the directors are Incumbent Directors. “Incumbent Directors” shall mean directors who either: (A) are directors of Parent as of the date hereof, or (B) are elected, or nominated for election, to the Board of Directors of Parent with the affirmative votes of at least a majority of those directors whose election or nomination was not in connection with any transaction described in subsections (i), (ii), or (iii) above, or in connection with an actual or threatened proxy contest relating to the election of directors to Parent.
(d) The parties agree that none of this Agreement, the Prior Continuation Agreement and the Employment Agreement shall be deemed to be a ‘management retention agreement’ under the terms of Parent’s Severance Plan effective November 15, 2002, as amended (the “Plan”), and that Employee shall be an Eligible Employee (as defined in the Plan) entitled to benefits under the Plan with respect to any Change of Control occurring after the date of this Agreement. Employee shall be considered a “Class I Eligible Employee” for purposes of the Plan with respect to any Change of Control (as defined in the Plan) occurring after the date of this Agreement. The benefits of this Agreement are intended to be in addition to the benefits Employee to which Employee may be entitled to under the Plan.
(e) Any severance payments to Employee under the Employment Agreement shall be deducted from payments otherwise due pursuant to this Section 1.
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Agreement, this Agreement is not intended to alter materially the compensation and benefits to which the Employee is entitled, or may become entitled, in respect of Employee’s employment by Employer and/or its affiliates.
Xxxxxxxxx
Electronics, Inc. 00000 Xx Xxxx |
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Xxxxxxxx Xxxxxxx, XX 00000 | ||||
Attention: President |
and to Employee at the address set forth in the records of Employer or at such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party. Any notice under this Agreement will be deemed to have been given when so delivered or five days after being mailed.
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among the parties, written or oral, which may have related to the subject matter of this Agreement in any way.
9. Choice of Law. All questions concerning the construction, validity and interpretation of this Agreement shall be governed by the internal law, and not the law of conflicts, of Arizona.
Signature Page Follow
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EMPLOYEE: Xxx Xxxxxxx | EMPLOYER: Xxxxxxxxx Electronics, Inc. | |
/s/ Xxx Xxxxxxx Signature Xxx Xxxxxxx |
By: /s/ Xxxxxx X. Xxxxxx Xxxxxx X. Xxxxxx, Secretary |