AMENDMENT NO. 1
TO
MANAGEMENT AGREEMENT
OF
XXXXX X. XXXXXXX
THIS AMENDMENT NO. 1 is made this 14 day of May, 1999, by and between
XXXXX TECHNOLOGIES, INC., a Delaware corporation (formerly known as Figgie
International Inc. and hereinafter referred to as the "Company") and Xxxxx X.
Xxxxxxx, an executive officer of the Company (hereinafter referred to as
"Executive"):
W I T N E S S E T H:
WHEREAS, on September 10, 1998 the Company and the Executive
entered into a Management Agreement (hereinafter referred to as the
"Agreement"); and
WHEREAS, the Company and the Executive desire to make certain
amendments to the Agreement;
NOW, THEREFORE, pursuant to Section 6.3 of the Agreement, the
Company and the Executive hereby amend the Agreement effective as of February
10, 1999, as follows:
(1) Section 4.9 of the Agreement is hereby amended by the
deletion of said Section and the substitution in lieu thereof of a new Section
4.9 to read as follows:
4.9 VESTING OF STOCK OPTIONS. In the event of a Change in
Control the Committee under the Option Plan will cause all stock
options granted to the Executive pursuant to the Option Plan to become
immediately exercisable as follows:
a. SERVICE BASED OPTIONS. Options which would otherwise
become exercisable solely upon the passage of time
regardless of the price of a Share of Common Stock of
the Company shall become exercisable in full upon the
Change in Control.
b. PERFORMANCE BASED OPTIONS. Options which would
otherwise become exercisable upon the attainment of a
specified price of a Share of Common Stock of the
Company shall become exercisable to the extent that
the sales price in the Change in Control transaction
satisfies the price targets set forth in the Option
Agreement, without regard to the 20 consecutive day
price maintenance requirement of the Option
Agreement.
In addition, to the extent that the sales
price in the Change in Control is above $15.75 per
share of Common Stock of the Company, is below $30
per share and is not equal to $18 or $24 per share
($15.75, $18, $24 and $30 are hereinafter referred to
as `price targets'), a part of the Option shall
become exercisable equal to the number of Shares
which would have become exercisable had the sales
price been at the next highest price target
multiplied by a fraction the numerator of which shall
equal the amount by which the sales price in the
Change in Control exceeds the next lower price target
and the denominator of which shall equal the amount
by which the next highest price target exceeds the
next lower price target.
In addition to the above provisions for with
respect to the exercisability of the stock option
shares in the event of a Change in Control, the Stock
Option Committee may in its sole discretion, waive
any or all remaining higher stock option price
targets and determine to make any or all of such
remaining shares exercisable.
Such stock options as become exercisable in accordance with the
preceding provisions shall remain so exercisable until their
expiration. The `price targets' referred to in the preceding paragraph
will be adjusted for any stock split, stock dividend, combination or
exchange of shares, exchange for other securities, reclassification,
reorganization, redesignation, merger, consolidation, recapitalization,
spin-off, split-off, split-up or other such change in accordance
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with the provisions of Section 8 of the Stock Option Agreement between
the Executive and the Company.
In the event the proceeds from a sale or disposition of any of
the Affiliates which the Company owns on the date of this Agreement are
used to provide a dividend to the stockholders of the Company, then
immediately upon the effective date of such sale or disposition the
Company will cause the stock options granted to the Executive pursuant
to the Option Plan to become immediately exercisable in the amounts
described above and to remain exercisable in such amounts so that the
Executive shall be entitled to become a stockholder of record such that
the Executive shall be entitled to receive the benefits of the
dividend."
(2) Subsection b of Section 6.7 of the Agreement is hereby
amended by the deletion of said Subsection and the substitution in lieu thereof
of a new Subsection b to read as follows:
"b. The term `Change in Control' shall include:
i. the receipt by the Company of a Schedule 13D or other
advice after the date of execution of this Agreement
indicating that a person is the "beneficial owner"
(as that term is defined in Rule 13d-3 under the
Securities Exchange Act of 1934) of fifty percent
(50%) or more of the Company's common stock of any
class or any securities convertible into such common
stock calculated as provided in paragraph (d) of said
Rule 13d-3;
ii. the date of approval by stockholders of the Company
of an agreement providing for any consolidation or
merger of the Company in which the Company will not
be the continuing or surviving corporation or
pursuant to which shares of capital stock, of any
class or any securities convertible
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into such capital stock, of the Company would be
converted into cash, securities, or other property,
other than a merger of the Company in which the
holders of common stock of all classes of the
Company immediately prior to the merger would have
the same proportion of ownership of common stock of
the surviving corporation immediately after the
merger;
iii. the date of the approval by stockholders of the
Company of any sale, lease, exchange, or other
transfer (in one transaction or a series of related
transactions) of all or substantially all the assets
of the Company;
iv. the adoption of any plan or proposal for the
liquidation (but not a partial liquidation) or
dissolution of the Company; or
v. such other event as the Compensation Committee of the
Board of Directors shall, in its sole and absolute
discretion, deem to be a `Change in Control.'"
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IN WITNESS WHEREOF, the Company, by its duly authorized
officers, and the Executive have executed this Amendment No. 1 as of the day and
year first above written.
XXXXX TECHNOLOGIES, INC.
("Company")
By____________________________
And___________________________
______________________________
Xxxxx X. Xxxxxxx ("Executive")
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