EXHIBIT 10.01
CERIDIAN CORPORATION
EXECUTIVE EMPLOYMENT AGREEMENT
PARTIES
CERIDIAN CORPORATION
0000 XXXX XXX XXXXXXXX XXXX
XXXXXXXXXXX, XXXXXXXXX 00000-0000
AND
XXXX X. XXXXXXXX
("EXECUTIVE")
DATE: APRIL 22, 2002
RECITALS
A. Ceridian wishes to obtain the services of Executive for the duration of
this Agreement, and Executive wishes to provide services for such
period.
B. Ceridian desires reasonable protection of Ceridian's Confidential
Information (as defined below).
C. Ceridian desires assurance that Executive will not compete with
Ceridian, engage in recruitment of Ceridian's employees or make
disparaging statements about Ceridian after termination of employment,
and Executive is willing to refrain from such competition, recruitment
and disparagement.
D. Executive desires to be assured of a minimum Base Salary (as defined
below) from Ceridian for Executive's services for the term of this
Agreement.
E. It is expressly recognized by the parties that Executive's acceptance
of, and continuance in, Executive's position with Ceridian and
agreement to be bound by the terms of this Agreement represents a
substantial commitment to Ceridian in terms of Executive's personal and
professional career and a foregoing of present and future career
options by Executive, for all of which Ceridian receives substantial
value.
F. The parties recognize that a Change of Control (as defined below) may
result in material alteration or diminishment of Executive's position
and responsibilities and substantially frustrate the purpose of
Executive's commitment to Ceridian and forbearance of career options.
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G. The parties recognize that in light of the above-described commitment
and forbearance of career options, it is essential that, for the
benefit of Ceridian and its stockholders, provision be made for the
possibility of a Change of Control Termination (as defined below) in
order to enable Executive to accept and effectively continue in
Executive's position in the face of inherently disruptive circumstances
arising from the possibility of a Change of Control of Ceridian
Corporation (as defined below), although no such change is now
contemplated or foreseen.
H. The parties wish to replace any and all employment and Change of
Control agreements between Executive and Ceridian Corporation.
NOW, THEREFORE, in consideration of Executive's acceptance of and continuance in
Executive's employment for the term of this Agreement and the parties' agreement
to be bound by the terms contained herein, the parties agree as follows:
ARTICLE I
DEFINITIONS
1.01 "BASE SALARY" shall mean regular cash compensation paid on a periodic
basis exclusive of benefits, bonuses or incentive payments.
1.02 "BOARD" shall mean the Board of Directors of Parent Corporation.
1.03 "CERIDIAN" shall mean Ceridian Corporation, a Delaware corporation
f/k/a New Ceridian Corporation, and, except for purposes of Section
7.01(b) and (h), and Section 9.02 of Article IX,
(a) any Subsidiary (as that term is defined in Section 1.07); and
(b) any successor in interest by way of consolidation, operation
of law, merger or otherwise.
1.04 "CONFIDENTIAL INFORMATION" shall mean information or material of
Ceridian which is not generally available to or used by others, or the
utility or value of which is not generally known or recognized as
standard practice, whether or not the underlying details are in the
public domain, including:
(a) information or material relating to Ceridian and its business
as conducted or anticipated to be conducted; business plans;
operations; past, current or anticipated services, products or
software; customers or prospective customers; relations with
business partners or prospective business partners; or
research, engineering, development, manufacturing, purchasing,
accounting, or marketing activities;
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(b) information or material relating to Ceridian's inventions,
improvements, discoveries, "know-how," technological
developments, or unpublished writings or other works of
authorship, or to the materials, apparatus, processes,
formulae, plans or methods used in the development,
manufacture or marketing of Ceridian's services, products or
software;
(c) information on or material relating to Ceridian which when
received is marked as "proprietary," "private," or
"confidential;"
(d) trade secrets of Ceridian;
(e) software of Ceridian in various stages of development,
software designs, web-based solutions, specifications,
programming aids, programming languages, interfaces, visual
displays, technical documentation, user manuals, data files
and databases of Ceridian; and
(f) any similar information of the type described above which
Ceridian obtained from another party and which Ceridian treats
as or designates as being proprietary, private or
confidential, whether or not owned or developed by Ceridian.
Notwithstanding the foregoing, "Confidential Information" does not
include any information which is properly published or in the public
domain; provided, however, that information which is published by or
with the aid of Executive outside the scope of employment or contrary
to the requirements of this Agreement will not be considered to have
been properly published, and therefore will not be in the public domain
for purposes of this Agreement.
1.05 "DISABILITY" shall mean the inability of Executive to perform his
duties under this Agreement because of illness or incapacity for a
continuous period of six months.
1.06 "PARENT CORPORATION" shall mean Ceridian Corporation and, except for
purposes of Article VIII and Section 9.02 of Article IX, any successor
in interest by way of consolidation, operation of law, merger or
otherwise. "Parent Corporation" shall not include any Subsidiary.
1.07 "SUBSIDIARY" shall mean: (a) any corporation at least a majority of
whose securities having ordinary voting power for the election of
directors (other than securities having such power only by reason of
the occurrence of a contingency) is at the time owned by Parent
Corporation and/or one or more Subsidiaries; and (b) any division or
business unit (or portion thereof) of Parent Corporation or a
corporation described in clause (a) of this Section 1.07.
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ARTICLE II
EMPLOYMENT, DUTIES AND TERM
2.01 EMPLOYMENT. Upon the terms and conditions set forth in this Agreement,
Ceridian hereby employs Executive, and Executive accepts such
employment.
2.02 DUTIES. Executive shall devote his full-time and best efforts to
Ceridian and to fulfilling the duties of his position which shall
include such duties as may from time to time be assigned him by
Ceridian, provided that such duties are reasonably consistent with
Executive's education, experience and background. Executive shall
comply with Ceridian's policies and procedures to the extent they are
not inconsistent with this Agreement in which case the provisions of
this Agreement prevail.
2.03 TERM. Subject to the provisions of Articles IV and VIII, this Agreement
and Executive's employment shall continue until April 22, 2005 (the
"Initial Term"). On each anniversary of the date of this Agreement, and
subject to the provisions of Articles IV and VIII, this Agreement and
Executive's employment shall be automatically extended for an
additional one-year period. For purposes hereof, the Initial Term,
together with any subsequent extensions thereof, are hereinafter
referred to as the "Term." Upon the occurrence of a Change of Control
during the Term, all applicable Change of Control protections set forth
herein (including, without limitation, those set forth in Article VII
hereof) shall continue to apply for the 24-month period commencing on
the date of the Change of Control.
ARTICLE III
COMPENSATION AND EXPENSES
3.01 BASE SALARY. For all services rendered under this Agreement during the
Term, Ceridian shall pay Executive a minimum Base Salary at no less
than the annual rate currently being paid or, if Executive is not
currently in Ceridian's employ, at the annual rate specified in the
written offer of employment. If Executive's salary is increased from
time to time during the term of this Agreement, the increased amount
shall be the Base Salary for the remainder of the term.
3.02 BONUS AND INCENTIVE. Bonus or incentive compensation shall be at the
sole discretion of Ceridian. Except as otherwise provided in Article
VII, Ceridian shall have the right, in accordance with their terms, to
alter, amend or eliminate any bonus or incentive plans, or Executive's
participation therein, without compensation to Executive.
3.03 BUSINESS EXPENSES. Ceridian shall, consistent with its policies in
effect from time to time, bear all ordinary and necessary business
expenses incurred by Executive in performing his duties as an employee
of Ceridian, provided that Executive accounts
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promptly for such expenses to Ceridian in the manner prescribed from
time to time by Ceridian.
ARTICLE IV
EARLY TERMINATION
4.01 EARLY TERMINATION. This Article shall not apply to a Change of Control
Termination which is governed solely by the provisions of Article VII,
and does not alter the respective continuing obligations of the parties
pursuant to Articles V, VI, and IX.
4.02 TERMINATION FOR CAUSE. Ceridian may terminate this Agreement and
Executive's employment immediately for cause. For the purpose hereof
"cause" means:
(a) fraud;
(b) misrepresentation;
(c) theft or embezzlement of Ceridian assets;
(d) intentional violations of law involving moral turpitude;
(e) failure to follow Ceridian's conduct and ethics policies;
and/or
(f) the continued failure by Executive to attempt in good faith to
perform his duties as reasonably assigned to Executive
pursuant to Section 2.02 of Article II of this Agreement for a
period of 60 days after a written demand for such performance
which specifically identifies the manner in which it is
alleged Executive has not attempted in good faith to perform
such duties.
In the event of termination for cause pursuant to this Section 4.02,
Executive shall be paid at the usual rate of Executive's annual Base
Salary through the date of termination specified in any written notice
of termination.
4.03 TERMINATION WITHOUT CAUSE. Either Executive or Ceridian may terminate
this Agreement and Executive's employment without cause on at least 75
days' written notice. In the event of termination of this Agreement and
of Executive's employment pursuant to this Section 4.03, compensation
shall be paid as follows:
(a) if the notice of termination is given by Executive, Executive
shall be paid at the usual rate of his annual Base Salary
through the 75 day notice period;
(b) if the notice of termination is given by Ceridian, (1)
Executive shall be paid at the usual rate of his annual Base
Salary through the 75 day notice period, however, Ceridian
shall have the option of making termination of the Agreement
and
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Executive's employment effective immediately upon notice in
which case Executive shall be paid a lump sum representing the
value of 75 days worth of salary; and (2) Executive shall
receive, starting within 15 days after the end of the 75 day
notice period, two years' annual Base Salary and annual
perquisite cash adder payable, at the sole discretion of
Ceridian, in either the form of a lump sum payment or on a
regular payroll period basis. In addition, Executive shall
receive the bonus, if any, to which Executive would otherwise
have become entitled under all applicable Ceridian annual
bonus plans in effect at the time of termination of this
Agreement had Executive remained continuously employed for the
full fiscal year in which termination occurred and continued
to perform his duties in the same manner as they were
performed immediately prior to termination, multiplied by a
fraction, the numerator of which shall be the number of whole
months Executive was employed in the year in which termination
occurred and the denominator of which is 12. This bonus amount
shall be paid within 15 days after the date such bonus would
have been paid had Executive remained employed for the full
fiscal year. In addition, Ceridian shall provide or make
arrangements for reasonable outplacement services for
Executive based on his level within Ceridian. The payment and
provision of the severance payments and benefits provided for
in this Section 4.03 are conditioned upon Executive executing
a release, similar to that attached as Exhibit A, of all
claims against Ceridian.
4.04 TERMINATION IN THE EVENT OF DEATH OR DISABILITY. This Agreement shall
terminate in the event of death or Disability of Executive.
(a) In the event of Executive's death, Ceridian shall pay an
amount equal to 12 months of Base Salary and annual perquisite
cash adder at the rate in effect at the time of Executive's
death plus the amount Executive would have received in annual
incentive plan bonus for the year in which the death occurs
had "target" goals been achieved. Such amount shall be paid
(1) to the beneficiary or beneficiaries designated in writing
to Ceridian by Executive, (2) in the absence of such
designation to the surviving spouse, or (3) if there is no
surviving spouse, or such surviving spouse disclaims all or
any part, then the full amount, or such disclaimed portion,
shall be paid to the executor, administrator or other personal
representative of Executive's estate. The amount shall be paid
as a lump sum as soon as practicable following Ceridian's
receipt of notice of Executive's death. All such payments
shall be in addition to any payments due pursuant to Section
4.04(c) below.
(b) In the event of Executive's Disability, Base Salary shall be
terminated as of the end of the month in which the last day of
the six-month period of Executive's inability to perform his
duties occurs.
(c) In the event of termination by reason of Executive's death or
Disability, Ceridian shall pay to Executive any amount equal
to (1) the amount Executive would have received in annual
incentive plan bonus for the year in which termination occurs
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had "target" goals been achieved, multiplied by (2) a
fraction, the numerator of which shall be the number of whole
months Executive was employed in the year in which the death
or Disability occurred and the denominator of which is 12. The
amount payable pursuant to this Section 4.04(c) shall be paid
within 15 days after the date such bonus would have been paid
had Executive remained employed for the full fiscal year.
4.05 RETIREMENT. Executive may terminate this Agreement and Executive's
employment as a result of Executive decision to retire from Ceridian.
Executive shall provide Ceridian with at least 75 days' written notice
of the date upon which Executive intends to retire. Executive shall be
paid at the usual rate of his annual Base Salary and annual perquisite
cash adder through the date of retirement stipulated in the written
notice. In addition, Executive shall receive payment on the date of
retirement of the bonus, if any, to which Executive would be entitled
to under all applicable Ceridian annual bonus plans in effect at the
time of his retirement.
4.06 PENSION SUPPLEMENT. If Ceridian terminates Executive's employment
without cause prior to Executive's 65th birthday, Ceridian shall
provide to Executive, out of its general assets, a monthly supplemental
retirement benefit in an amount equal to the actuarial equivalent of
the difference, if any between:
(a) the monthly benefit to which Executive would have been
entitled under the defined benefit pension plan or plans in
which he participated immediately prior to his termination of
employment if the amount of payment to which Executive is
entitled under Section 4.03(b)(2) were taken into account for
purposes of determining his "final average pay" or similar
term (as then defined under the terms of such plan or plans)
for either (1) the year in which Executive's termination of
employment occurred; or (2) the prior full year, whichever
provides the highest total final average pay; and
(b) the amount to which Executive is, in fact, entitled under such
plan or plans.
The benefit calculated under this Section 4.05 shall be paid at the
same time and in the same form as the benefit under the plans with
respect to which such calculation is made.
4.07 ENTIRE TERMINATION PAYMENT. The compensation provided for in this
Article IV for early termination of this Agreement and termination
pursuant to this Article IV shall constitute Executive's sole remedy
for such termination. Executive shall not be entitled to any other
termination or severance payment which may be payable to Executive
under any other agreement between Executive and Ceridian.
ARTICLE V
CONFIDENTIALITY, DISCLOSURE AND ASSIGNMENT
5.01 CONFIDENTIALITY. Executive acknowledges that Ceridian has taken
reasonable measures to preserve the secrecy of its Confidential
Information. Executive will not, during the term or after the
termination or expiration of this Agreement or his/her employment,
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publish, disclose, or utilize in any manner any Confidential
Information obtained while employed by Ceridian. If Executive leaves
the employ of Ceridian, Executive will not, without Ceridian's prior
written consent, retain or take away any drawing, writing or other
record in any form containing any Confidential Information.
5.02 BUSINESS CONDUCT AND ETHICS. During the term of employment with
Ceridian, Executive will engage in no activity or employment which may
conflict with the interest of Ceridian, and will comply with Ceridian's
policies and guidelines pertaining to business conduct and ethics.
5.03 DISCLOSURE. Executive will disclose promptly in writing to Ceridian all
inventions, discoveries, software, writings and other works of
authorship which are conceived, made, discovered, or written jointly or
singly on Ceridian time or on Executive's own time, providing the
invention, improvement, discovery, software, writing or other work of
authorship is capable of being used by Ceridian in the normal course of
business, and all such inventions, improvements, discoveries, software,
writings and other works of authorship shall belong solely to Ceridian.
5.04 INSTRUMENTS OF ASSIGNMENT. Executive will sign and execute all
instruments of assignment and other papers to evidence transfer of
Executive's entire right, title and interest in such inventions,
improvements, discoveries, software, writings or other works of
authorship in Ceridian, at the request and the expense of Ceridian, and
Executive will do all acts and sign all instruments of assignment and
other papers Ceridian may reasonably request relating to applications
for patents, patents, copyrights, and the enforcement and protection
thereof. If Executive is needed, at any time, to give testimony,
evidence, or opinions in any litigation or proceeding involving any
patents or copyrights or applications for patents or copyrights, both
domestic and foreign, relating to inventions, improvements,
discoveries, software, writings or other works of authorship conceived,
developed or reduced to practice by Executive, Executive agrees to do
so, and if Executive leaves the employ of Ceridian, Ceridian shall pay
Executive at a rate mutually agreeable to Executive and Ceridian, plus
reasonable traveling or other expenses.
5.05 INVENTIONS DEVELOPED ON EXECUTIVE'S OWN TIME. The two immediately
preceding sections entitled "Disclosure" and "Instruments of
Assignment" do not apply to inventions in which a Ceridian claim of any
rights will create a violation of Chapter 181 Minnesota Statutes,
Section 181.78, reproduced below and constituting the written
notification of its Subdivision 3.
181.78 Agreements; terms relating to inventions
Subdivision 1.
Any provision in an employment agreement which provides that an
employee shall assign or offer to assign any of the employee's rights
in an invention to the employer shall not apply to an invention for
which no equipment, supplies, facility or trade secret
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information of the employer was used and which was developed entirely
on the employee's own time, and (1) which does not relate (a) directly
to the business of the employer or (b) to the employer's actual or
demonstrably anticipated research or development, or (2) which does not
result from any work performed by the employee for the employer. Any
provision which purports to apply to such an invention is to that
extent against the public policy of this state and is to that extent
void and unenforceable.
Subdivision 2.
No employer shall require a provision made void and unenforceable by
subdivision 1 as a condition of employment or continuing employment.
Subdivision 3.
IF AN EMPLOYMENT AGREEMENT ENTERED INTO AFTER AUGUST 1, 1977, CONTAINS
A PROVISION REQUIRING THE EMPLOYEE TO ASSIGN OR OFFER TO ASSIGN ANY OF
THE EMPLOYEE'S RIGHTS IN ANY INVENTION TO AN EMPLOYER, THE EMPLOYER
MUST ALSO, AT THE TIME THE AGREEMENT IS MADE, PROVIDE A WRITTEN
NOTIFICATION TO THE EMPLOYEE THAT THE AGREEMENT DOES NOT APPLY TO AN
INVENTION FOR WHICH NO EQUIPMENT, SUPPLIES, FACILITY OR TRADE SECRET
INFORMATION OF THE EMPLOYER WAS USED AND WHICH WAS DEVELOPED ENTIRELY
ON THE EMPLOYEE'S OWN TIME, AND (1) WHICH DOES NOT RELATE (a) DIRECTLY
TO THE BUSINESS OF THE EMPLOYER OR (b) TO THE EMPLOYER'S ACTUAL OR
DEMONSTRABLY ANTICIPATED RESEARCH OR DEVELOPMENT, OR (2) WHICH DOES NOT
RESULT FROM ANY WORK PERFORMED BY THE EMPLOYEE FOR THE EMPLOYER.
5.06 EXECUTIVE'S DECLARATION. Executive has no inventions, data bases,
improvements, discoveries, software, writings or other works of
authorship useful to Ceridian in the normal course of business, which
were conceived, made or written prior to the date of this Agreement and
which are excluded from this Agreement.
5.07 SURVIVAL. The obligations of this Article V shall survive the
expiration or termination of this Agreement and Executive's employment.
ARTICLE VI
NON-COMPETITION, NON-RECRUITMENT, AND NON-DISPARAGEMENT
6.01 GENERAL. The parties hereto recognize and agree that (a) Executive is a
senior executive of Ceridian and is a key executive of Ceridian, (b)
Executive has received, and will in the future receive, substantial
amounts of Confidential Information, (c) Ceridian's business is
conducted on a worldwide basis, and (d) provision for non-competition,
non-recruitment and non-disparagement obligations by Executive is
critical to Ceridian's continued
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economic well-being and protection of Ceridian's Confidential
Information. In light of these considerations, this Article VI sets
forth the terms and conditions of Executive's obligations of
non-competition, non-recruitment and non-disparagement subsequent to
the termination of this Agreement and/or Executive's employment for any
reason other than a Change of Control Termination. Sections 6.02 and
6.03 of this Agreement shall be of no further force or effect upon a
Change of Control Termination.
6.02 NON-COMPETITION.
(a) During the term of this Agreement, Executive will devote full
time and energy to furthering Ceridian's business and will not
pursue any other business activity without Ceridian's written
consent. Unless the obligation is waived or limited by
Ceridian in accordance with subsection (b) of this Section
6.02, Executive agrees that during his employment with
Ceridian and for a period of two years following termination
of employment for any reason other than a Change of Control
Termination ("Non-Compete Period"), Executive will not
directly or indirectly, alone or as a partner, officer,
director, shareholder or employee of any other firm or entity,
engage in any commercial activity in competition with any part
of Ceridian's business as conducted as of the date of such
termination of employment or with any part of Ceridian's
contemplated business with respect to which Executive has
Confidential Information. For purposes of this subsection (a),
"shareholder" shall not include beneficial ownership of less
than five percent (5%) of the combined voting power of all
issued and outstanding voting securities of a publicly held
corporation whose stock is traded on a major stock exchange.
Also for purposes of this subsection (a), "Ceridian's
business" shall include business conducted by Ceridian or its
affiliates and any partnership or joint venture in which
Ceridian or its affiliates is a partner or joint venturer;
provided that, "affiliate" as used in this sentence shall not
include any corporation in which Ceridian has ownership of
less than fifteen percent (15%) of the voting stock.
(b) At its sole option Ceridian may, by written notice to
Executive at any time within the Non-Compete Period, waive or
limit the time and/or geographic area in which Executive
cannot engage in competitive activity.
(c) During the Non-Compete Period, prior to accepting employment
with or agreeing to provide consulting services to, any firm
or entity which offers competitive products or services,
Executive shall give 30 days prior written notice to Ceridian.
Such written notice shall describe the firm and the employment
or consulting services to be rendered to the firm or entity,
and shall include a copy of the written offer of employment or
engagement of consulting services. Ceridian's failure to
respond or object to such notice shall not in any way
constitute acquiescence or waiver of Ceridian's rights under
this Article VI.
(d) In the event Executive has provided notice to Ceridian
pursuant to subsection (c) of this Section 6.02 and has not
accepted employment with or agreed to provide consulting
services to, any firm or entity directly as a result of his
non-
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competition obligation pursuant to this Section 6.02, Ceridian
shall pay Executive an amount equal to the usual rate of
Executive's Base Salary in effect at the time of termination
on a regular payroll period basis until the end of the
Non-Compete Period. There shall be credited against Ceridian's
obligation to make such payments any other payments made by
Ceridian to Executive pursuant to Article IV of this
Agreement. In the event that Ceridian elects, pursuant to
subsection (b) of this Section 6.02, to waive all or any
portion of the non-competition obligation set forth in
subsection (a) hereof, no payment shall be required by
Ceridian with respect to the portion of the Non-Compete Period
which has been waived.
(e) In the event Executive fails to provide notice to Ceridian
pursuant to subsection (c) of this Section 6.02 and/or in
anyway violates its non-competition obligation pursuant to
Section 6.02, Ceridian may enforce all of its rights and
remedies provided to it under this Agreement, in law and in
equity, and Executive shall be deemed to have expressly waived
any rights he may have had to payments under subsection (d) of
this Section 6.02.
6.03 NON-RECRUITMENT. During the term of employment and for a period of two
years following termination of employment for any reason other than a
Change of Control Termination, Executive will not directly or
indirectly hire any of Ceridian's employees, or solicit any of
Ceridian's employees for the purpose of hiring them or inducing them to
leave their employment with Ceridian, nor will Executive own, manage,
operate, join, control, consult with, participate in the ownership,
management, operation or control of, be employed by, or be connected in
any manner with any person or entity which engages in the conduct
proscribed in this Section 6.03. This provision shall not preclude
Executive from responding to a request (other than by Executive's
employer) for a reference with respect to an individual's employment
qualifications.
6.04 NON-DISPARAGEMENT. Executive will not, during the term or after the
termination or expiration of this Agreement or Executive's employment,
make disparaging statements, in any form, about Ceridian, its officers,
directors, agents, employees, products or services which Executive
knows, or has reason to believe, are false or misleading.
6.05 SURVIVAL AND ENFORCEABILITY. The obligations of this Article VI shall
survive the expiration or termination of this Agreement and Executive's
employment. Should any provision of this Article VI be held invalid or
illegal, such illegality shall not invalidate the whole of this Article
VI or the Agreement, but, rather, Article VI shall be construed as if
it did not contain the illegal part or narrowed to permit its
enforcement, and the rights and obligations of the parties shall be
construed and enforced accordingly. In furtherance of and not in
limitation of the foregoing, Executive expressly agrees that should the
duration of or geographical extent of, or business activities covered
by, any provision of this Article VI be in excess of that which is
valid or enforceable under applicable law, then such provision shall be
construed to cover only that duration, extent or activities that may
validly be covered. Executive acknowledges the uncertainty of the law
in this respect and expressly stipulates that this Article VI shall be
construed in a manner that renders its provisions valid and enforceable
to the maximum extent (not exceeding its express terms)
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possible under applicable law. This Article VI does not replace and is
in addition to any other agreements Executive may have with Ceridian on
the matters addressed herein.
ARTICLE VII
CHANGE OF CONTROL
7.01 DEFINITIONS. For purposes of this Article VII, the following
definitions shall be applied:
(a) "BENEFIT PLAN" means any formal or informal plan, program or
other arrangement heretofore or hereafter adopted by Ceridian
for the direct or indirect provision of compensation to
Executive (including groups or classes of participants or
beneficiaries of which Executive is a member), whether or not
such compensation is deferred, is in the form of cash or other
property or rights, or is in the form of a benefit to or for
Executive.
(b) "CHANGE OF CONTROL" shall mean the first of the following
events to occur:
(1) there is consummated a merger or consolidation to
which Ceridian or any direct or indirect subsidiary
of Ceridian is a party if the merger or consolidation
would result in the voting securities of Ceridian
outstanding immediately prior to such merger or
consolidation continuing to represent (either by
remaining outstanding or by being converted into
voting securities of the surviving entity or any
parent thereof) less than 60% of the combined voting
power of the securities of Ceridian or such surviving
entity or any parent thereof outstanding immediately
after such merger or consolidation; or
(2) the direct or indirect beneficial ownership (as
defined in Rule 13d-3 under the Securities Exchange
Act of 1934, as amended (the "Exchange Act") in the
aggregate of securities of Ceridian representing
twenty percent (20%) or more of the total combined
voting power of Ceridian's then issued and
outstanding securities is acquired by any person or
entity, or group of associated persons or entities
acting in concert; provided, however, that for
purposes hereof, the following acquisitions shall not
constitute a Change of Control: (A) any acquisition
by Ceridian or any of its subsidiaries, (B) any
acquisition directly from Ceridian or any of its
subsidiaries, (C) any acquisition by any employee
benefit plan (or related trust or fiduciary)
sponsored or maintained by Ceridian or any
corporation controlled by Ceridian, (D) any
acquisition by an underwriter temporarily holding
securities pursuant to an offering of such
securities, (E) any acquisition by a corporation
owned, directly or indirectly, by the stockholders of
Ceridian in substantially the same proportions as
their ownership of stock of Ceridian, (F) any
acquisition in connection with which, pursuant to
Rule 13d-1 promulgated pursuant to the Exchange Act,
the individual, entity or group is permitted to, and
actually does, report its
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beneficial ownership on Schedule 13G (or any
successor Schedule); provided that, if any such
individual, entity or group subsequently becomes
required to or does report its beneficial ownership
on Schedule 13D (or any successor Schedule), then,
for purposes of this paragraph, such individual,
entity or group shall be deemed to have first
acquired, on the first date on which such individual,
entity or group becomes required to or does so report
on Schedule 13D, beneficial ownership of all of the
voting securities of Ceridian beneficially owned by
it on such date, and (G) any acquisition in
connection with a merger or consolidation which,
pursuant to paragraph (1) above, does not constitute
a Change of Control; or
(3) there is consummated a transaction contemplated by an
agreement for the sale or disposition by Ceridian of
all or substantially all of Ceridian's assets, other
than a sale or disposition by Ceridian of all or
substantially all of Ceridian's assets to an entity,
at least 60% of the combined voting power of the
voting securities of which are owned by stockholders
of Ceridian in substantially the same proportions as
their ownership of Ceridian immediately prior to such
sale; or
(4) the stockholders of Ceridian approve any plan or
proposal for the liquidation of Ceridian; or
(5) a change in the composition of the Board such that
the "Continuity Directors" cease for any reason to
constitute at least a majority of the Board. For
purposes of this clause, "Continuity Directors" means
(A) those members of the Board who were directors on
the date hereof and (B) those members of the Board
(other than a director whose initial assumption of
office was in connection with an actual or threatened
election contest, including but not limited to a
consent solicitation, relating to the election of
directors of Ceridian) who were elected or appointed
by, or on the nomination or recommendation of, at
least a two-thirds (2/3) majority of the
then-existing directors who either were directors on
the date hereof or were previously so elected or
appointed; or
(6) such other event or transaction as the Board shall
determine constitutes a Change of Control.
(c) "CHANGE OF CONTROL COMPENSATION" means any payment or benefit
(including any transfer of property) in the nature of
compensation, to or for the benefit of Executive under this
Agreement or any Other Agreement or Benefit Plan, which is
considered to be contingent on a change in the ownership or
effective control of Ceridian for purposes of Section 280G of
the Code.
(d) "CHANGE OF CONTROL TERMINATION" means, with respect to
Executive, either of the following events occurring on or
within two years after a Change of Control:
13
(1) Termination of Executive's employment by Ceridian for
any reason other than (A) fraud, (B) theft or
embezzlement of Ceridian assets, (C) intentional
violations of law involving moral turpitude, or (D)
failure to follow Ceridian's conduct and ethics
policies; or
(2) Termination of employment with Ceridian by Executive
for Good Reason.
A Change of Control Termination by Executive shall not, however,
include termination by reason of death or Disability. A termination of
Executive's employment by Ceridian shall not constitute a termination
described in clauses (A) through (D) of Section 7.01(d)(1) unless (i)
there has been delivered to Executive by the Board, at least 10 days
prior to such termination, a written notice which specifically
identifies conduct described in clauses (A), (B), (C) or (D) of Section
7.01(d)(1) in which the Board believes Executive has engaged and
provides Executive an opportunity to cure such conduct and (ii) the
Board has duly adopted (following the expiration of the aforementioned
cure period) a resolution, by the affirmative vote of not less than
two-thirds (2/3) of the entire membership of the Board at a meeting of
the Board which was called and held for the purpose of considering such
termination (after reasonable notice to the Executive and an
opportunity for the Executive, together with the Executive's counsel,
to be heard before the Board) finding that, in the good faith opinion
of the Board, the Executive was guilty of conduct described in clauses
(A), (B), (C) or (D) of Section 7.01(d)(1), and specifying the
particulars thereof in detail. For purposes of this Agreement,
Executive's employment shall be deemed to have been terminated pursuant
to a Change of Control Termination, if Executive's employment is
terminated by Ceridian other than for the reasons described in clauses
(A) through (D) of Section 7.01(d)(1) during the pendency of a
Potential Change of Control and Executive reasonably demonstrates that
such termination was at the request or direction of a person or entity
who has entered into an agreement, the consummation of which would
result in a Change of Control, or is otherwise in connection with or in
anticipation of a Change of Control (whether or not a Change of Control
ever occurs). For purposes of this Agreement, in the event of a
termination described in the preceding sentence, a Change of Control
will be deemed to have occurred immediately prior to the termination of
Executive's employment for purposes of this Agreement.
(e) "CODE" means the Internal Revenue Code of 1986, as amended.
Any reference to a section of the Code shall include the
corresponding section of such Code as from time to time
amended.
(f) "GOOD REASON" means a good faith determination by Executive,
in Executive's sole and absolute judgment, that any one or
more of the following events has occurred, without Executive's
express written consent, on or after a Change of Control:
(1) A change in Executive's reporting responsibilities,
titles or offices as in effect immediately prior to
the Change of Control, or any removal of
14
Executive from, or any failure to re-elect
Executive to, any of such positions, which has the
effect of materially diminishing Executive's
responsibility or authority (it being expressly
understood that Executive shall have Good Reason if
he ceases to be an executive officer of a
publicly-held corporation);
(2) A reduction by Ceridian in Executive's Base Salary,
bonus opportunity or annual perquisite cash adder as
in effect immediately prior to the Change of Control
or as the same may be increased from time to time
thereafter or any failure by Ceridian to pay any
portion of Executive's compensation when due;
(3) Ceridian requiring Executive to be based anywhere
other than within 50 miles of Executive's job
location at the time of the Change of Control;
(4) Without replacement by plans, programs, or
arrangements which, taken as a whole, provide
benefits to Executive at least reasonably comparable
to those discontinued or adversely affected, (A) the
failure by Ceridian to continue in effect any
pension, bonus, incentive, stock ownership, purchase,
option, life insurance, health, accident, disability,
or any other employee compensation or benefit plan,
program or arrangement, in which Executive is
participating immediately prior to a Change of
Control; or (B) the taking of any action by Ceridian
that would materially and adversely affect
Executive's participation or materially reduce
Executive's benefits under any of such plans,
programs or arrangements;
(5) The failure by Ceridian to provide office space,
furniture, and secretarial support at least
comparable to that provided Executive immediately
prior to the Change of Control or the taking of any
similar action by Ceridian that would materially
adversely affect the working conditions in or under
which Executive performs his employment duties;
(6) If Executive's primary employment duties are with a
Subsidiary, the sale, merger, contribution, transfer
or any other transaction in conjunction with which
Parent Corporation's ownership interest in such
Subsidiary decreases below the level specified in
Section 1.07 of Article I unless (A) this Agreement
is assigned to the purchaser/transferee with the
provisions of Article VII in full force and effect
and operative as if a Change of Control has occurred
with respect to the purchaser/transferee as Parent
Corporation immediately after the purchase/transfer
becomes effective, and (B) such purchaser/transferee
has a creditworthiness reasonably equivalent to
Parent Corporation's; or
(7) Any material breach of this Agreement by Ceridian.
15
Executive's right to terminate employment for Good Reason shall not be
affected by Executive's incapacity due to physical or mental illness.
Executive's continued employment shall not constitute consent to, or a
waiver of rights with respect to, any event constituting Good Reason
hereunder.
(g) "OTHER AGREEMENTS" means any agreement, contract or
understanding heretofore or hereafter entered into between
Executive and Ceridian for the direct or indirect provision of
compensation to Executive.
(h) "POTENTIAL CHANGE OF CONTROL" shall be deemed to have occurred
if the event set forth in any one of the following subsections
shall have occurred: (A) Ceridian enters into an agreement,
the consummation of which would result in the occurrence of a
Change of Control; (B) Ceridian or any person or entity
publicly announces an intention to take or to consider taking
actions which, if consummated, would constitute a Change of
Control; (C) any person becomes the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of Ceridian representing 15% or more
of either the then outstanding shares of common stock of
Ceridian or the combined voting power of Ceridian's then
outstanding securities; or (D) the Board adopts a resolution
to the effect that, for purposes of this Agreement, a
Potential Change of Control has occurred.
7.02 TERMINATION BY EXECUTIVE. The termination of Executive's employment as
described in Section 7.01(d)(2) shall be accomplished by, and effective
upon, Executive giving written notice to Ceridian of Executive's
decision to terminate. Except as otherwise expressly provided in this
Agreement, upon the exercise of said right, all obligations and duties
of Executive under this Agreement shall be of no further force and
effect.
7.03 CHANGE OF CONTROL TERMINATION PAYMENT.
(a) In the event of a Change of Control Termination, Ceridian
shall, within five days of such termination, make a lump sum
payment to Executive in an amount equal to three times the sum
of (i) 12 months of Base Salary at the rate in effect at the
time of Executive's termination (without giving effect to any
reduction in Base Salary constituting Good Reason), (ii) the
bonus, if any, that Executive would have earned under all
applicable Ceridian bonus plans for the year in which the
termination occurs had "superior" goals been achieved (without
giving effect to any reduction in bonus opportunity
constituting Good Reason), and (iii) the annual perquisite
cash adder Executive would have received in the year in which
the termination occurs (without giving effect to any reduction
in the annual cash adder constituting Good Reason). Ceridian
shall also pay to Executive, within five days of such
termination, a prorated portion of Executive's bonus
compensation for the fiscal year in which the Change of
Control Termination occurs (assuming that any applicable
performance objectives were achieved at the "target" level of
performance and without giving effect to any reduction in
bonus opportunity constituting Good Reason) calculated by
multiplying (A) the
16
maximum achievable amount of such bonus compensation by (B) a
fraction, the numerator of which is the number of days in the
applicable fiscal year through the date of termination and the
denominator of which is 365.
(b) In addition to the payments made pursuant to Section 7.03(a)
hereof, in the event the Change of Control Termination that
occurred during the term of this Agreement, then, and without
further action by the Board, Compensation Committee or otherwise,
Ceridian shall provide also to Executive a pension supplement
equivalent to the difference, if any, between: (i) the monthly
benefits to which Executive would have been entitled under the
defined benefit pension plan or plans in which Executive
participates immediately prior to the Change of Control
Termination which includes an additional three years of age and
service; and (ii) the amount to which Executive is, in fact,
entitled under such defined benefit pension plan or plans.
(c) Neither the payments made or the pension supplement provided
pursuant to this Section 7.03 nor any other compensation to be
provided to Executive by Ceridian pursuant to this Agreement or
any Other Agreement or Benefit Plan which may be considered Change
of Control Compensation shall be subject to any limitation on
Change of Control Compensation which may otherwise be expressed in
any such other Agreement or Benefit Plan.
(d) Following a Change of Control Termination, Ceridian shall provide
Executive with outplacement services suitable to the Executive's
position for a period of three years or, if earlier, until the
first acceptance by the Executive of an offer of employment.
Following a Change of Control Termination, Ceridian shall
reimburse Executive for all customary relocation expenses incurred
by Executive in one move out of Executive's state of residence
within the one year period following such Change of Control
Termination.
(e) In the event of a Change of Control Termination, all outstanding
Ceridian options and other equity awards held by Executive shall
become fully vested and exercisable and, if applicable, free from
all restrictions.
(f) The payments and benefits described in this Article VII shall be
conditioned upon Executive executing (and not effectively
rescinding) a release of claims against Ceridian substantially
identical to that attached as Exhibit A hereto.
7.04 TAX REIMBURSEMENT.
(a) Anything in this Agreement to the contrary notwithstanding, in the
event it shall be determined that any payments or distributions by
Ceridian, any person or entity whose actions result in a Change of
Control or any person or entity affiliated with the Company or
such person or entity, to or for the benefit of Executive (whether
paid or payable or distributed or distributable pursuant to the
terms of this Agreement or otherwise, but determined without
regard to any payments required
17
under this Section 7.04) (collectively, the "Payments") would be
subject to the excise tax imposed by Section 4999 of the Code or
any interest or penalties are incurred by Executive with respect
to such excise tax (such excise tax, together with any such
interest and penalties, are hereinafter collectively referred to
as the "Excise Tax"), then Executive shall be entitled to receive
an additional payment (a "Gross-Up Payment") in an amount such
that, after payment by Executive of all taxes (and any interest or
penalties imposed with respect to such taxes), including any
income taxes and Excise Tax imposed upon the Gross-Up Payment,
Executive retains an amount of the Gross-Up Payment equal to the
Excise Tax imposed upon the Payments.
(b) Subject to the provisions of Section 7.04(d), all determinations
required to be made under this Section 7.04, including whether and
when a Gross-Up Payment is required and the amount such Gross-Up
Payment and the assumptions to be utilized in arriving at such
determination, shall be made by Ceridian's external auditors (the
"Accounting Firm"), which shall provide detailed supporting
calculations both to Ceridian and Executive within 15 business
days of the receipt of notice from Executive that there has been a
Payment, or such earlier time as is requested by Ceridian. In the
event that the Accounting Firm is serving as accountant or auditor
for the individual, entity or group effecting the Change of
Control, Executive shall appoint another nationally recognized
accounting firm to make the determinations required hereunder
(which accounting firm shall then be referred to as the
"Accounting Firm" hereunder). All fees and expenses of the
Accounting Firm shall be borne solely by Ceridian. Any Gross-Up
Payment, as determined pursuant to this Section 7.04, shall be
paid by Ceridian to Executive within five days of the receipt of
the Accounting Firm's determination. Any determination by the
Accounting Firm shall be binding upon Ceridian and Executive.
(c) As a result of 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 Gross-Up Payments
which should have been made by Ceridian will not have been made
("Underpayment"), consistent with the calculations required to be
made hereunder. In the event that Ceridian exhausts its remedies
pursuant to Section 7.04(d) and Executive thereafter is required
to make a payment of any additional Excise Tax, the Accounting
Firm shall determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly paid by
Ceridian to or for the benefit of Executive.
(d) Executive shall notify Ceridian in writing of any claim by the
Internal Revenue Service or any other taxing authority that, if
successful, would require the payment by Ceridian of any Gross-Up
Payment. Such notification shall be given as soon as practicable
but no later than ten business days after Executive knows of such
claim and shall apprise Ceridian of the nature of such claim and
the date on which such claim is requested to be paid. Executive
shall not pay such claim prior to the expiration of the thirty-day
period following the date on which it gives
18
such notice to Ceridian (or such shorter period ending on the date
that any payment of taxes with respect to such claim is due). If
Ceridian notifies Executive in writing prior to the expiration of
such period that it desires to contest such claim, Executive
shall:
(i) give Ceridian any information reasonably
requested by Ceridian relating to such claim;
(ii) take such action in connection with
contesting such claim as Ceridian shall
reasonably request in writing from time to
time, including accepting legal
representation with respect to such claim by
an attorney reasonably selected by Ceridian;
(iii) cooperate with Ceridian in good faith in
order to effectively contest such claim; and
(iv) permit Ceridian to participate in any
proceedings relating to such claim;
provided, however, that Ceridian shall bear and pay directly all
costs and expenses (including additional interest and penalties)
incurred in connection with such contest and shall indemnify and
hold Executive harmless, on an after-tax basis, for any Excise Tax
or income tax (including interest and penalties with respect
thereto) imposed as a result of such representation and payment of
costs and expenses. Without limitation on the foregoing provisions
of this Section 7.04(d), Ceridian shall control all proceedings
taken in connection with such contest and, at its sole option, may
pursue or forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in respect of
such claim and may, at its sole option, either direct Executive to
pay the tax claimed and xxx for a refund or contest the claim in
any permissible manner, and Executive agrees to prosecute such
contest to a determination before any administrative tribunal, in
a court of initial jurisdiction and in one or more appellate
courts, as Ceridian shall determine; provided further, however,
that if Ceridian directs Executive to pay such claim and xxx for a
refund, Ceridian shall advance the amount of such payment to
Executive on an interest-free basis and shall indemnify and hold
Executive harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties with respect thereto)
imposed with respect to such advance or with respect to any
imputed income with respect to such advance; and provided further
that any extension of the statute of limitations relating to
payment of taxes for the taxable year of Executive with respect to
which such contested amount is claimed to be due is limited solely
to such contested amount. Furthermore, Ceridian's control of the
contest shall be limited to issues with respect to which a
Gross-Up Payment would be payable hereunder and Executive shall be
entitled to settle or contest, as the case may be,
19
any other issue raised by the Internal Revenue Service or any
other taxing authority.
(e) If, after the receipt by Executive of an amount advanced by
Ceridian pursuant to Section 7.04(d), Executive becomes entitled
to receive any refund with respect to such claim, Executive shall
(subject to Ceridian's complying with the requirements of Section
7.04(d)) promptly pay to Ceridian the amount of such refund
(together with any interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by Executive of an
amount advanced by Ceridian pursuant to Section 7.04(d), a
determination is made that Executive shall not be entitled to any
refund with respect to such claim and Ceridian does not notify
Executive in writing of its intent to contest such denial of
refund prior to the expiration of thirty days after such
determination, then such advance shall be forgiven and shall not
be required to be repaid and the amount of such advance shall
offset, to the extent thereof, the amount of Gross-Up Payment
required to be paid.
7.05 INTEREST. In the event Ceridian does not make timely payment in full of
the Change of Control Termination Payment described in Section 7.03,
Executive shall be entitled to receive interest on any unpaid amount at
the lower of: (a) the prime rate of interest (or such comparable index as
may be adopted) established from time to time by the Bank of America
National Trust and Savings Association, New York, New York or its
successor in interest; or (b) the maximum rate permitted under Section
280G(d)(4) of the Internal Revenue Code.
7.06 ATTORNEYS' FEES. In the event Executive incurs any legal expense to
enforce or defend his rights under this Article VII of this Agreement, or
to recover damages for breach thereof, Executive shall be entitled to
recover from Ceridian any expenses for attorneys' fees and disbursements
incurred. Such payments shall be made within five (5) business days after
delivery of Executive's written requests for payment accompanied with
such evidence of fees and expenses incurred as Ceridian reasonably may
require.
7.07 BENEFITS CONTINUATION. In the event of a Change of Control Termination,
Executive shall, until age 65, be entitled to receive from Ceridian
health, dental, accidental death and dismemberment, and life insurance
coverage substantially equivalent to the coverage Executive had on the
day immediately prior to the Change of Control, including any coverage
then in effect for Executive's spouse, domestic partner or dependents.
Executive shall be required to pay no more for the above mentioned
benefits than the amount Executive would have been required to pay had
Executive continued to be an active employee of Ceridian. If continuation
of any of such coverage is made available to employees terminating at age
55 with 15 or more years of service, Executive shall be required to pay
no more for continuation than is required of such employees on the day
immediately prior to the Change of Control. If the provision of any such
coverage to Executive causes inclusion of any amount in Executive's gross
income that would not have been so included had Executive received such
coverage as an active employee, Ceridian shall pay Executive the amount
necessary to wholly offset the federal and state
20
income taxes attributable to such amount and the tax reimbursement
amounts paid pursuant to this sentence.
7.08 MITIGATION; OFFSET. Following a Change of Control Termination, Executive
is not required to seek other employment or to attempt in any way to
reduce any amounts payable to the Executive by pursuant to this Article
VII. The amount of any payment or benefit provided for in this Agreement
shall not be reduced by any compensation earned by Executive as the
result of employment by another employer, by retirement benefits, by
offset against any amount claimed to be owed by Executive to Parent
Corporation, any Subsidiary or otherwise.
ARTICLE VIII
CHANGE OF SUBSIDIARY STATUS
In the event that, prior to a Change of Control: (a) a Subsidiary is sold,
merged, contributed, or in any other manner transferred, or if for any reason
Parent Corporation's ownership interest in any such Subsidiary falls below the
level specified in Section 1.07, (b) Executive's primary employment duties are
with the Subsidiary at the time of the occurrence of such event, and (c)
Executive does not, in conjunction therewith, transfer employment directly to
Parent Corporation or another Subsidiary, then:
(1) If Executive gives his written consent to the assignment of this
Agreement to such Subsidiary, or to the purchaser or new majority
interest holder of such Subsidiary, (and such assignment is
accepted) this Agreement shall remain in full force and effect
between Executive and the assignee, except that the provisions of
Article VII of this Agreement shall become null and void;
(2) If such assignment is not accepted by the Subsidiary or purchaser,
then this Agreement shall be deemed to have been terminated by
Ceridian without cause pursuant to Section 4.03 of Article IV; and
(3) In all other cases, this Agreement shall be deemed terminated for
cause pursuant to Section 4.02 of Article IV.
ARTICLE IX
GENERAL PROVISIONS
9.01 NO ADEQUATE REMEDY. The parties declare that it is impossible to measure
in money the damages which will accrue to either party by reason of a
failure to perform any of the obligations under this Agreement and
therefore injunctive relief is appropriate. Therefore, if either party
shall institute any action or proceeding to enforce the provisions
hereof, such party against whom such action or proceeding is brought
hereby waives the
21
claim or defense that such party has an adequate remedy at law, and such
party shall not urge in any such action or proceeding the claim or
defense that such party has an adequate remedy at law.
9.02 SUCCESSORS AND ASSIGNS. Except as otherwise provided in Article VIII,
this Agreement shall be binding upon and inure to the benefit of the
successors and assigns of Parent Corporation and each Subsidiary, whether
by way of merger, consolidation, operation of law, assignment, purchase
or other acquisition of substantially all of the assets or business of
Ceridian, and any such successor or assign shall absolutely and
unconditionally assume all of Ceridian's obligations hereunder.
9.03 NOTICES. All notices, requests and demands given to or made pursuant
hereto shall, except as otherwise specified herein, be in writing and be
delivered or mailed to any such party at its address:
(a) Ceridian Corporation 0000 Xxxx Xxx Xxxxxxxx Xxxx Xxxxxxxxxxx,
Xxxxxxxxx 00000-0000 Attention: Office of General Counsel
(b) In the case of Executive shall be:
At the address listed on the last page of this Agreement.
Either party may, by notice hereunder, designate a changed
address. Any notice, if mailed properly addressed, postage
prepaid, registered or certified mail, shall be deemed dispatched
on the registered date or that stamped on the certified mail
receipt, and shall be deemed received within the second business
day thereafter or when it is actually received, whichever is
sooner.
9.04 CAPTIONS. The various headings or captions in this Agreement are for
convenience only and shall not affect the meaning or interpretation of
this Agreement.
9.05 GOVERNING LAW. The validity, construction and performance of this
Agreement shall be governed by the laws of the State of Minnesota and any
and every legal proceeding arising out of or in connection with this
Agreement shall be brought in the appropriate courts of the State of
Minnesota, each of the parties hereby consenting to the exclusive
jurisdiction of said courts for this purpose. The parties hereto
expressly recognize and agree that the implementation of this Governing
Law provision is essential in light of the fact that Parent Corporation's
corporate headquarters and its principal executive offices are located
within the State of Minnesota, and there is a critical need for
uniformity in the interpretation and enforcement of the employment
agreements between Ceridian and its senior executives.
9.06 CONSTRUCTION. Wherever possible, each provision of this Agreement shall
be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of
22
this Agreement shall be prohibited by or invalid under applicable law,
such provision shall be ineffective only to the extent of such
prohibition or invalidity without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
9.07 WAIVERS. No failure on the part of either party to exercise, and no delay
in exercising, any right or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right or remedy
hereunder preclude any other or further exercise thereof or the exercise
of any other right or remedy granted hereby or by any related document or
by law.
9.08 MODIFICATION. Any changes or amendments to this Agreement must be in
writing and signed by both parties.
9.09 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement and
understanding between the parties hereto in reference to all the matters
herein agreed upon. This Agreement replaces in full all prior employment
or Change of Control agreements or understandings of the parties hereto
with respect to such subject matter, and any and all such prior
agreements or understandings are hereby rescinded by mutual agreement.
[REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK]
23
IN WITNESS WHEREOF, The parties hereto have caused this Agreement to be duly
executed and delivered as of the day and year first above written.
EXECUTIVE CERIDIAN CORPORATION
/s/ Xxxx X. Xxxxxxxx By: /s/ Xxxxxxx X. Xxxxxx
-------------------- ---------------------
Xxxx X. Xxxxxxxx Xxxxxxx X. Xxxxxx
Title: Senior Vice President, Human
Resources
Address:
------------------------------
------------------------------
------------------------------
24
EXHIBIT A
RELEASE
I, Xxxx X. Xxxxxxxx, in consideration of the payments of $_________
subject to appropriate withholding, which includes compensation to which I would
not be otherwise entitled, do, except as specifically provided below, hereby
fully and completely release and waive any and all claims, complaints, causes of
action or demands of whatever kind which I have or may have against Ceridian
Corporation, its predecessors, successors, subsidiaries and affiliates and all
past and present members of the Board of Directors, officers, employees and
agents of those persons and companies ("Ceridian") arising out of any actions,
conduct, decisions, behavior or events occurring up to the date of my execution
of this Release.
I understand and accept that this Release specifically covers but is
not limited to any and all claims, complaints, causes of action or demands which
I have or may have against the above-referenced released parties relating in any
way to the terms, conditions and circumstances of my employment up to the date
of my signature below, any form of employment discrimination prohibited under
any state's human rights act, Title VII of the Federal Civil Rights Act of 1964
and the Federal Age Discrimination in Employment Act. I further understand that
this Release extends to but is not limited to all claims which I may have based
on statutory or common law claims for negligence or other breach of duty,
wrongful discharge, breach of contract, breach of any express or implied
promise, misrepresentation, fraud, retaliation, breach of public policy,
infliction of emotional distress, defamation, promissory estoppel, failure to
pay wages or any other theory, whether legal or equitable. Notwithstanding the
foregoing, I do not waive my rights to (i) enforce the performance by Ceridian
of its obligations under the Executive Employment Agreement between myself and
Ceridian (including, without limitation, the obligation to make the payments and
provide the benefits described in Article VII thereof if applicable), (ii) any
pension or other employee benefits payable pursuant to the terms of the
applicable plans of Ceridian or any affiliate, which benefits shall be paid or
provided in accordance with the terms of such plans or (iii) indemnification
from Ceridian with respect to my service with Ceridian, whether provided
pursuant to Ceridian's bylaws or otherwise.
Nothing contained herein, however, shall be construed to prohibit me
from filing a charge with the Equal Employment Opportunity Commission, but my
release includes a release of my right to file a court action or to seek
individual remedies or damages in any Equal Employment Opportunity
Commission-filed court action, and my release of these rights shall apply with
full force and effect to any proceedings arising from or relating to such a
charge.
I agree that my only remedy for any dispute I have about the
enforceability of this Release shall be to submit that dispute to final and
binding arbitration in accordance with the rules of the American Arbitration
Association. Ceridian and I agree that I must send written notice of any claim
to Ceridian by certified mail, return receipt requested. Written notice to
Ceridian shall be sent to its Secretary at 0000 Xxxx Xxx Xxxxxxxx Xxxx,
Xxxxxxxxxxx, XX 00000-0000.
I understand that I may rescind this Release if I do so in writing,
delivered by certified mail, return receipt requested, to Office of the General
Counsel, Ceridian Corporation, 3311 East
00
Xxx Xxxxxxxx Xxxx, Xxxxxxxxxxx, XX 00000-0000, within fifteen (15) calendar days
of the date of my signature below. Upon the expiration of fifteen (15) calendar
days from the date indicated below, if I have not rescinded this Release, then
Ceridian Corporation shall promptly deliver to me the above-referenced payment,
subject to appropriate withholding, this Release being contingent upon payment
of that sum.
If sent by mail, the rescission must be:
- Postmarked within the 15 calendar-day period;
- Properly addressed to Ceridian; and
- Sent by certified mail, return receipt requested.
By my signature below, I acknowledge that I fully understand and accept
the terms of this Release, and I represent and agree that my signature is
freely, voluntarily and knowingly given. I have had 21 days in which to consider
this agreement. By my signature below, I further acknowledge that I have been
provided a full opportunity to review and reflect on the terms of this Release
and to seek the advice of legal counsel of my choice, which advice I have been
encouraged to obtain.
If I do not execute this Release within 30 days after I receive it, the
offer Ceridian has made for a payment herein is null and void.
Date:________________________ ____________________________
Xxxx X. Xxxxxxxx
26
