EXECUTIVE EMPLOYMENT AGREEMENT
Exhibit 10.23
THIS EXECUTIVE EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into as of August 7,
2006 by and among Thermadyne Holdings Corporation, a Delaware corporation (“Holdings”), and
Xxxxxx X. Xxxxxx (“Employee”).
RECITALS
A. The Parties desire Employee to be employed by Holdings in the capacity of Executive Vice
President — Chief Financial Officer and Chief Administrative Officer; and
| B. | The Parties desire to set forth the terms and conditions of such employment to which each Party will be bound; |
NOW THEREFORE, for and in consideration of the foregoing recitals, and in consideration of the
mutual covenants, agreements, understandings, undertakings, representations, warranties and
promises hereinafter set forth, and intending to be legally bound thereby, Holdings and Employee do
hereby covenant and agree as follows:
SECTION 1. Basic Employment Provisions
(a) Employment and Term. Holdings hereby employs Employee (hereinafter referred to as the
“Employment”) as Executive Vice President — Chief Financial Officer and Chief
Administrative Officer of Holdings and of Holdings’ subsidiaries (hereinafter collectively and
individually referred to as “Employers”) and Employee agrees to be employed by Employers in such
capacity, all on the terms and conditions set forth herein. The Employment shall be for a period
(the “Employment Period”) that will (i) commence on a mutually agreed date, no later than
August 7, 2006 (the “Effective Date” and continue for at least two years thereafter (unless
earlier terminated as provided herein) and (ii) renew on the second anniversary of the Effective
Date and each anniversary of the Effective Date thereafter for a one-year period, on the same terms
and conditions contained herein (unless earlier terminated as provided herein or Employee is timely
provided a notice of non-renewal as provided herein), such that the Employment Period shall extend
for a period of one year from the date of each such extension. The Employers must provide Employee
with written notice not less than 90 days in advance of the applicable anniversary of the Effective
Date in order to avoid renewal of the Employment Period on such anniversary as described above.
Notice shall be deemed given on the date it is received by the Employee. If Employers elect not to
renew the Employment Period in accordance with this Section
1(a), Employee shall be
entitled to continue to receive from Employers his then current basic compensation hereunder, such
amount to continue to be paid in accordance with the payroll practices of Employers for a period
equal to twelve months from the expiration of the Employment Period. If, however, the Employment
Period is not renewed, the Employee is a “specified employee” within the meaning of Section
409A(a)(2)(B)(i) of the Internal Revenue Code of 1986, as amended (“Code”), and payments under this
Section 1(a) are not a separation
pay arrangement within the meaning of Prop. Treasury Reg. 1.409A-1(a)(9) or any successor Treasury
Regulations, the payment of Employee’s current basic compensation
shall be paid for a period of twelve consecutive months commencing with the seventh consecutive
month immediately following the month in which the Employment Period ends.
(b) Duties. Employee shall be subject to the direction and supervision of the CEO and, as the
Executive Vice President — Chief Financial Officer and Chief Administrative Officer shall have
those duties and responsibilities which are assigned to him during the Employment Period by the CEO
consistent with his position. The parties expressly acknowledge that the Employee shall devote
substantially all of his business time and attention to the transaction of Employers’ businesses as
is necessary to discharge his supervisory management responsibilities hereunder. The foregoing will
not preclude reasonable participation in civic and community organizations and participation as a
member of the board of directors of at least one company will be permitted. Employee agrees to
perform faithfully the duties assigned to him to the best of his ability.
SECTION 2. Compensation.
(a) Salary. Employers shall pay to Employee during the Employment Period a salary as basic
compensation for the services to be rendered by Employee hereunder. The initial amount of such
salary shall be $325,000 per annum. Such salary shall be reviewed no less frequently than annually
by the CEO and may be increased upon the approval of the CEO, subject to the approval of the Board
of Directors of Holdings. Such salary shall accrue and be payable in accordance with the payroll
practices of Employers’ subsidiary or subsidiaries in effect from time to time. All such payments
shall be subject to deduction and withholding authorized or required by applicable law.
(b) Bonus. During the Employment Period, Employee shall additionally participate in an annual
bonus plan providing for an annual bonus opportunity of not less than 75% of Employee’s annual
salary for each calendar year, in accordance with the terms set forth in Employers’ then current
Management Incentive Plan.
(c) Benefits. During the Employment Period, Employee shall be entitled to participate in such
employee benefit plans, programs and arrangements made available to, and on the same terms as,
other similarly situated executives of Employers, including, without limitation, 401(k) plans,
employee stock purchase plans, and any other retirement plans, health, group life (with optional
additional coverage), short term disability, long term disability (not to exceed 60% of Employee’s
annual salary otherwise payable to him for the applicable period), hospitalization and such other
benefit programs as may be approved from time to
time by Employers for their executives. Employee shall be entitled to four weeks paid vacation per
year. Nothing herein shall affect Employers’ right to amend, modify or terminate any retirement or
other benefit plan at any time on a company-wide basis for similarly situated executives.
(d) Stock Options. Holdings shall grant Employee stock options (the “Options”) to purchase up to
120,000 shares the common stock of Holdings in accordance with the terms and conditions of
Thermadyne Holdings Corporation 2004 Stock Incentive Plan. The exercise price for the Options shall
be equal to the closing bid
2
price per share of the common stock on the over-the-counter market as of the close of business
immediately preceding the date of Employee’s execution of this Agreement. Subject in each case to
Employee’s continued Employment until the applicable vesting date, one-half of the Options will
become vested and, subject to compliance with applicable securities laws, exercisable in three
equal annual installments on each of the next three anniversaries of the Effective date, and the
remaining one-half of the Option (the “Performance Options”) will become vested, and subject to
compliance with applicable securities laws, exercisable in three equal annual installments on each
of the first three anniversaries of the date of grant (each an “Installment Date”) if Holdings
achieves its Return on Invested Capital Targets in accordance with its annual budget for the
immediately preceding fiscal year. If any Performance Options do not vest in any year due to the
failure to meet the Return on Invested Capital Targets for such year,
such
Options shall vest on any subsequent Installment Date if Holdings has cumulatively achieved on such
date the Return on Invested Capital Targets for the current year, plus the Return on Invested
Capital Targets for the prior years for which such Targets were not achieved (after taking into
account any portion of such Targets achieved in such prior years); Provided, however, that if the
Performance Options do not vest by the final Installment Date, then such Options shall vest on the
seventh anniversary of the grant, provided Employee is still employed with the Employers on such
date. In addition to the grant listed above, Employee will be eligible for future grants on the
same basis as similarly situated employees of the Employers.
SECTION 3. Termination.
(a)
Death or Disability. Employment of Employee under this Agreement shall terminate
automatically upon the death or total disability of Employee. For the purpose of this Agreement,
Employee shall be totally disabled if he is disabled within the meaning of Code Section
409A(a)(2)(C).
(b) Cause. The CEO, subject to the prior approval from the Board of Directors, may terminate
the Employment of Employee under this Agreement for Cause. For the purposes of this Agreement,
“Cause” shall be deemed to be (i) an act of willful misconduct, fraud, embezzlement, theft,
or any other act constituting a felony, involving moral turpitude or causing material harm,
financial or otherwise, to the Employers; (ii) an intentional act or failure to act, which is
committed by the Employee and which causes or can be expected to imminently cause material injury
to any of the Employers; (iii) a material breach of this Agreement that is not cured by the
Employee within 15 days after written notice from the CEO specifying the breach and requesting a
cure; or (vi) habitual abuse of alcohol, narcotics or other controlled substances which impairs
Employee’s ability to perform Employee’s duties hereunder.
(c) Without Cause. Any of the Employers, acting alone, may terminate the Employment of
Employee under this Agreement without Cause.
(d) Constructive Termination. Employee may elect to terminate his Employment under this
Agreement upon a Constructive Termination Without
Cause, as defined below. For purposes of this Agreement, “Constructive
Termination Without
3
Cause” shall mean a termination of the Employee’s employment at his initiative following
the occurrence, without the Employee’s prior written consent, of one or more of the following
events:
(i) any failure by the Employers to comply with any of the provisions of this Agreement,
other than an isolated, insubstantial and inadvertent failure not occurring in bad faith
and which is remedied by the Employers within 30 days after receipt of written notice
thereof given by the Employee;
(ii) any reduction in salary, bonus percentage or material reduction in duties;
(iii) any purported termination by the Employers of the Employee’s employment otherwise
than as expressly permitted by Section 3(b) of this Agreement;
(iv) any failure by the Employers to comply with and satisfy the provisions of Section 6
hereof, or failure by 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 Employers to assume
expressly and agree to perform this Agreement in the same manner and to the same extent the
Employers would be required to perform it if no such succession had taken place, provided, in
either case, that the successor contemplated by Section 6 hereof has received, at least 10
days prior to the giving of notice of constructive termination by the Employee, written notice from
the Employers or the Employee of the requirements of the provisions of Section 6 or of such
failure. Employers agree to provide copy of this agreement to any such successor prior to the
succession.
(v) The Employers shall relocate its principal executive offices or require the Employee
to have his principal location of work changed, in either case, to any location which is
in excess of 45 miles of its current location.
SECTION 4. Compensation Following Termination.
(a) Death. If the Employment Period is terminated pursuant to the provisions of Section 3(a) above
due to the death of Employee, this Agreement shall terminate, and no further compensation shall be
payable to Employee’s estate, heirs or beneficiaries, as applicable, except that Employee’s estate,
heirs or beneficiaries, as applicable, shall be entitled to receive (i) Employee’s then current
basic
compensation through the end of the month in which Employee’s death occurred, (ii) a pro rata
portion (based on a fraction the numerator of which is the number of days Employee worked in the
year of Employee’s death and the denominator of which is 365) of the bonus as set forth in
Section 2(b) which Employee would have been entitled to receive for the year in which
termination occurs if the performance objectives established in Employers’ Management incentive
Plan are achieved, and (iii) any un-reimbursed expenses pursuant to Section 5 below, and,
thereafter, Employers shall have no further obligations or liabilities hereunder to
4
Employee’s estate or legal representative or otherwise, other than the payment of benefits, if any,
pursuant to Section 2(c).
(b) Disability. If the Employment Period is terminated pursuant to the
provisions of Section 3(a) above due to Employee’s total disability as determined
thereunder, this Agreement shall terminate, and (i) Employers will continue the payment of
Employee’s basic compensation at the then current rate until the earlier of (A) the benefits under
any long-term disability insurance provided by Employers commences or (B) 180 days from the date of
such total disability, (ii) Employers shall pay a pro rata portion (based on a fraction the
numerator of which is the number of days Employee worked in the year Employee became totally
disabled and the denominator of which is 365) of the bonus as set forth in Section 2(b)
which Employee would have been entitled to receive for the year in which termination occurs if the
performance objectives established in Employers’ Management Incentive Plan are achieved, and (iii)
Employers
shall pay any un-reimbursed expenses pursuant to Section 5 below. Thereafter,
Employers shall have no obligation for basic compensation or other compensation
payments to Employee during the continuance of such total disability.
(c) Termination for Cause or Voluntary Termination. If the Employment Period is terminated
for Cause pursuant to Section 3(b) or voluntarily by the Employee for reasons other than those
described in Section 3(a) or 3(d) above, no further compensation or benefits shall be paid
to Employee after the date of termination, but Employee shall be entitled to receive benefits to
which he is or may become entitled pursuant to any benefit plan which by its terms survive
termination.
(d)
Termination Without Cause; Constructive Termination. If the Employment
Period is terminated pursuant to Section 3(c) or 3(d) above, Employee shall be entitled (i)
to continue to receive from Employers his then current basic compensation hereunder, such amount to
continue to be paid in accordance with the payroll practices of Employers for a period equal to 12
months, (ii) to receive within 30 days of termination a bonus in an amount that shall be 75% of
Employee’s annual base compensation, and (iii) during such 12-month period, to continue to receive
the benefits to which he would otherwise be entitled during the Employment Period pursuant to
Section 2(c) above; provided that Employee shall continue to make the same contributions
toward such coverage as Employee was making on the date of termination, with such adjustments to
contributions as are made generally for all Employers’ employees. If the Employee is a “specified
employee” within the meaning of Code Section 409A(a)(2)(B)(i) at the time the Employment Period
expires and payments under this Section 4(d) are not a separation pay arrangement within the
meaning of Prop.
Treasury Reg. 1.409A-1(a)(9) or any successor Treasury Regulations, the payments under Section
4(d)(i) shall be paid for a period of twelve consecutive months commencing with the seventh
consecutive month immediately following the month in which the Employment Period ends.
Provided, however, that Employee shall no longer be entitled to participate in any of
Employers’ 401K plans, employee stock purchase plans or any other retirement plans. Employee
shall have the option to receive the present value of the benefits (at a 12% discount) described in
the immediately preceding sentence in a lump sum payment, with such option to be exercised by
Employee in writing within thirty (30) days of termination and
5
Employer shall make such lump sum payment within thirty (30) days of receiving the written notice
from Employee. In the event of Employee’s death during such 12-month period, such continuation of
compensation and benefits shall cease upon Employee’s death. In the event Employee obtains
employment elsewhere during such 12-month period, such compensation and benefits shall continue for
the period described above notwithstanding such reemployment of Employee. The sums received by
Employee under this Section 4(d) shall be considered liquidated damages in respect of claims based
on any provisions of this Agreement or Employee’s employment with Employers and the commencement of
the payment of such sums by Employers shall not begin until Employee executes and delivers a
general release of all such claims in form and substance mutually satisfactory to Employers and
Employee.
SECTION 5. Expense Reimbursement. Upon the submission of properly documented expense account
reports, Employers shall reimburse Employee for all reasonable business-related travel and
entertainment expenses incurred by Employee in the course of his Employment with Employers. Unless
otherwise expressly provided in this Agreement, Employers’ obligations under this Section 5 shall
terminate upon the termination of the Employment Period, except for any expenses eligible for
reimbursement hereunder that are incurred prior to such termination.
SECTION 6. Assignability Binding Nature. This Agreement shall be binding
and inure to the benefit of the parties, and their respective successors, heirs (in the case of
Employee) and assigns. No obligations of the Employers under this Agreement may be assigned or
transferred by the Employers except that such obligations shall be assigned or transferred (as
described below) pursuant to a merger or consolidation of Holdings in which Holdings is not the
continuing entity, or the sale or liquidation of all or substantially all of the assets of the
Employers, provided that the assignee or transferee is the surviving entity or successor to all or
substantially all of the assets of the Employers and such assignee or transferee assumes the
liabilities, obligations and duties of the Employers, as contained in this Agreement, either
contractually or as a matter of law. As used in this Agreement, the “Employers” and “Holdings”
shall mean the Employers and Holdings as hereinbefore defined, respectively, and any successor
to their business and/or assets as aforesaid which assumes and agrees to perform this Agreement by
operation of law, or otherwise.
SECTION 7. Confidential Information.
(a) Non-Disclosure. During the Employment Period or at any time thereafter, irrespective of
the time, manner or cause of the termination of this Agreement,
Employee will not directly or indirectly reveal, divulge, disclose or communicate to any person or
entity, other than authorized officers, directors and employees of the Employers, in any manner
whatsoever, any Confidential Information (as hereinafter defined) of Employers or any subsidiary of
Employers without the prior written consent of the CEO.
(b) Definition. As used herein, “Confidential Information” means information
disclosed to or known by Employee as a direct or indirect consequence of or through the Employment
about Employers or any subsidiary of Employers, or their respective businesses, products and
practices which information is not generally known in the
6
business in which Employers or any subsidiary of Employers is or may be engaged. However,
Confidential Information shall not include under any circumstances any information with respect to
the foregoing matters which is (i) directly available to the public from a source other than
Employee, (ii) released in writing by Employers to the public or to persons who are not under a
similar obligation of confidentiality to Employers and who are not parties to this Agreement, (iii)
obtained by Employee from a third party not under a similar obligation of confidentiality to
Employers, (iv) required to be disclosed by any court process or any government or agency or
department of any
government, or (v) the subject of a written waiver executed by either Employers for the benefit of
Employee. In the event Employee believes that he is free to disclose or utilize Confidential
Information under Section 7(b), he shall give written notice of the same to Employers at
least 30 days prior to the release or use of such Confidential Information and shall specify the
claimed exemption and the circumstances giving rise thereto.
(c) Return of Property. Upon termination of the Employment, Employee will surrender to Employers
all Confidential Information, including, without limitation, all lists, charts, schedules, reports,
financial statements, books and records of the Employers or any subsidiary of the Employers, and
all copies thereof, and all other property belonging to the Employers or any subsidiary of the
Employers, including, without limitation, company credit cards, cell phones, personal data
assistants or other electronic devices, provided Employee shall be accorded reasonable access to
such Confidential Information subsequent to the Employment Period for any proper purpose as
determined in the reasonable judgment of any of the Employers.
SECTION 8. Agreement Not to Compete.
(a) Termination for Cause. In the event that Employee is terminated for Cause pursuant to Section
3(b) above or voluntarily terminates his Employment with Employers other than as a Constructive
Termination pursuant to Section 3(d) above, Employee hereby agrees that for a period of 12 months
following such termination, he shall not, either in his own behalf or as a partner, officer,
director, employee, agent or shareholder (other than as the holder of less than 5% of the
outstanding capital stock of any corporation with a class of equity security registered under
Section 12(b) or Section 12(g) of the Securities Exchange Act of 1934, as amended) engage in,
invest in or render services to any person or entity engaged in the businesses in which Employers
or any subsidiary of Employers are then engaged and situated within any country. Nothing contained
in this Section 8(a) shall be construed as restricting the Employee’s right to sell or otherwise
dispose of any business or investments owned or operated by Employee as of the date hereof.
(b) Termination Without Cause or for Disability; Constructive Termination. In the event that the
Employment of Employee is terminated by Employers without Cause pursuant to Section 3(c) above, or
as a result of the total disability of Employee or by Employee as a Constructive Termination
pursuant to Section 3(a) and 3(d) above, respectively, Employee hereby agrees that during the
period that Employee accepts payments from the Employers pursuant to a disability plan sponsored by
Employers pursuant to Section 2(c) and 4(b) above or payments pursuant to Section 4(d) above, as
7
applicable, neither he nor any affiliate shall, either in his own behalf or as a partner, officer,
director, employee, agent or shareholder (other than as the holder of less than 5% of the
outstanding capital stock of any, corporation with a class of equity security registered under
Section 12(b) or Section 12(g) of the Securities Exchange Act of 1934, as amended) engage in,
invest in or render services to any person or entity engaged in the businesses in which Employers
or any subsidiary of Employers is then engaged and situated within any country. Nothing contained
in this Section 8(b) shall be construed as restricting the Employee’s right to sell or
otherwise dispose of any business or investments owned or operated by Employee as of the date
hereof.
SECTION 9. Agreement Not to Solicit Employees. Employee agrees that, for a period of twelve months
following the termination for any reason, neither he nor any affiliate shall, on behalf of any
business engaged in a business competitive with Employers or any subsidiary of Employers, solicit
or induce, or in any manner attempt to solicit or induce any person employed by, or any agent of,
any Employers or any subsidiary of Employers to terminate his or her employment or agency, as the
case may be, with any Employers or such subsidiary.
SECTION 10. Injunctive Relief and other Remedies.
(a) Employee acknowledges and agrees that the covenants, obligations and agreements of
Employee contained in Section 7, Section 8, Section 9 and this Section
10 relate to special, unique and extraordinary matters and that a violation of any of the terms
of such covenants, obligations or agreements will cause Employers irreparable injury for which
adequate remedies are not available at law. Therefore, Employee agrees that Employers shall be
entitled to an injunction, restraining order or such other equitable relief as a court of competent
jurisdiction may deem necessary or appropriate to restrain Employee from committing any violation
of such covenants, obligations or agreements.
(b)
If Employee violates the provisions of Section 8, or 9 after the Employment
of Employee is terminated for any reason, and fails to cease or cure such violation within thirty
(30) days after the receipt by Employee of written notice of violation from Holdings, the right of Employee
to receive any further payment pursuant to this Agreement shall immediately terminate and the payments made to
Employee subsequent to the termination of Employee’s Employment pursuant to this Agreement shall be returned to
Employers by Employee within thirty (30) days after receipt of written notice from Employers of such violation.
The injunctive remedies and other remedies
described in this Section 10 are cumulative and in addition to any other rights and remedies Employers may have.
SECTION 11. No Violation. Employee hereby represents and warrants to Employers that the execution,
delivery and performance of this Agreement by Employee does not, with or without the giving of
notice or the passage of time, or both, conflict with, result in a default, right to accelerate or
loss of rights under any provision of any agreement or understanding to which the Employee or, to
the best knowledge of Employee, any of Employee’s affiliates are a party or by which Employee, or
to the best knowledge of Employee, Employee’s affiliates may be bound or affected.
8
SECTION 12. Captions. The captions, headings and arrangements used in this Agreement are for
convenience only and do not in any way affect, limit or amplify the provisions hereof.
SECTION 13. Notices. All notices required or permitted to be given hereunder shall be in writing
and shall be deemed delivered, whether or not actually received, (i) one day after deposit with a
nationally recognized overnight express courier service with receipt of deposit confirmed, or (ii)
two days after deposited in the United States mail, postage prepaid, registered or certified mail,
return receipt requested, addressed to the party to whom notice is being given at the specified
address or at such other address as such party may designate by notice:
| Employers: | Thermadyne Holdings Corporation | |||
| Attn: Chief Executive Officer | ||||
| 00000 Xxxxxxxx Xxxxx Xxxx, Xxxxx 000 | ||||
| Xx. Xxxxx, XX 00000 | ||||
| Fax: 000.000.0000 | ||||
| and | ||||
| Thermadyne Holdings Corporation | ||||
| Attn: General Counsel | ||||
| 00000 Xxxxxxxx Xxxxx Xxxx, Xxxxx 000 | ||||
| Xx. Xxxxx, XX 00000 | ||||
| Fax: 000.000.0000 | ||||
| Employee: | c/o Thermadyne Holdings Corporation | |||
| 00000 Xxxxxxxx Xxxxx Xxxx, Xxxxx 000 | ||||
| Xx. Xxxxx, Xxxxxxxx 00000 | ||||
| Xxxxxxx XxxXxxxxx, PC | ||||
| Attention: Xxxx X. Xxxxxx | ||||
| 000 X. Xxxxxxx, Xxxxx 0000 | ||||
| Xx. Xxxxx, Xxxxxxxx 00000 |
SECTION 14. Invalid Provisions. If any provision of this Agreement is held to be illegal, invalid
or unenforceable under present or future laws, such provisions shall be fully severable, and this
Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision
had never comprised a part of this
Agreement; the remaining provisions of this Agreement shall remain in full force and effect and
shall not be affected by the illegal, invalid or unenforceable provision or by its severance for
this Agreement. In lieu of each such illegal, invalid or unenforceable provision, there shall be
added automatically as part of this Agreement a provision as similar in terms to such illegal,
invalid or unenforceable provision as may be possible and be legal, valid and enforceable.
9
SECTION 15. Amendments. This Agreement may be amended in whole or in part only by an instrument in
writing setting forth the particulars of such amendment and duly executed by an officer of
Employers and by Employee.
SECTION 16. Waiver. No delay or omission by any party hereto to exercise any right or power
hereunder shall impair such right or power to be construed as a waiver thereof. A waiver by any of
the parties hereto of any of the covenants to be performed by any other party or any breach thereof
shall not be construed to be a waiver of any succeeding breach thereof or of any other covenant
herein contained. Except as otherwise expressly set forth herein, all remedies provided for in this
Agreement shall be cumulative and in addition to and not in lieu of any other remedies available to
any party at law, in equity or otherwise.
SECTION 17. Counterparts. This Agreement may be executed in multiple counterparts, each of which
shall constitute an original, and all of which together shall constitute one and the same
Agreement.
SECTION 18. Governing Law. This Agreement shall be construed and enforced according to the laws of
the State of Missouri.
SECTION 19. Resolution of Disputes; Arbitration. Any dispute arising out of or
relating to this Agreement or Employee’s employment with Employers or the termination thereof shall
be resolved first by negotiation between the parties. If such negotiations leave the matter
unresolved after 60 days, then such dispute or claim shall be resolved by binding confidential
arbitration, to be held in St. Louis, Missouri, in accordance with the Commercial Arbitration Rules
of the American Arbitration Association. The arbitrator in any arbitration provided for herein will
be mutually selected by the parties or in the event the parties cannot mutually agree, then
appointed by the American Arbitration Association. Both parties hereby voluntarily waive any right
to trial by jury. Judgment upon the award rendered by the arbitrator(s) may be entered in any court
having jurisdiction thereof. The parties shall be responsible for their own costs and
expenses under this Section 19, although the arbitrator shall have the right and
jurisdiction to award costs and attorneys’ fees to the prevailing (in the opinion of the
arbitrator) party. Nothing in this Section 19 shall limit the Employers’ right to obtain an
injunction, restraining order or other equitable relief pursuant to Section 10.
SECTION 20. Payment Upon Death of Employee. In the event of the death of Employee during the term
hereof, any unpaid payments due either prior to Employee’s death or after Employee’s death shall be
payable as designated by Employee prior to his death in
writing to Employers, or, in the absence of such designation, as designated in the depositive
investments or beneficiary designation of Employee duly executed by Employee according to law. In
the event of the death of all such persons so designated by Employee, either prior to the death of
the Employee or during any time when payments are due as provided herein, or in the event Employee
fails to so designate prior to his death, or withdraws all such designations, said payments
thereafter shall be made to Employee’s estate.
SECTION 21. Prior Employment Agreements. This Agreement supersedes any and all other prior
employment, change-in-control, severance or similar agreements between Employee and Employers.
10
SECTION 22. Jointly and Severally Liable. Each of the Employers that have signed below is a party
to this Agreement and is jointly and severally liable for the obligations of Employers set forth in
this Agreement.
SECTION 23. Relocation and Other. Within 30 days of the Effective Date, Employers will pay Employee
$65,000 in recognition of relocation and other forfeitures incurred by Employee. In addition, the
Employers will pay Employee’s actual and reasonable legal expenses incurred in connection with
accepting employment with the Employers.
SECTION 24. Tax considerations.
(a) Golden Parachute Taxes. Notwithstanding anything herein to the
contrary, in the event of any payments or benefits provided to Employee hereunder, or
under any other benefit, bonus, option, incentive or severance plan are subject to and
excise tax under Section 4999 of the Internal Revenue Code of
1986, as amended (the “Code”), the Company shall pay Employee, within ten (10) days of such determination,
an amount equal to such tax plus an additional amount so that the net after tax effect,
considering Federal and state income taxes, Federal Insurance Contribution Act and
Medicare taxes and the excise tax under Section 4999 of the Code, of the payment of
such excise tax is as if such additional payment had not been made. A determination
required to be made under this Section 24 and the assumptions to be utilized in arriving at
such determination shall be made by an independent, nationally recognized accounting
firm (the “Auditor”) acceptable to Holdings. The Auditor shall provide detailed
supporting calculations to both Holdings and the Employee within fifteen (15) days of the receipt
of a notice from Employee that there has been a payment under this Agreement that is subject to an
excise tax under Section 4999 of the Code. All fees and expenses of the Auditor shall be paid by
Holdings. All determinations by the Auditor shall be binding upon the Holdings and Employee.
(b) Withholding Taxes. All payments under this Agreement shall be net of appropriate
withholding taxes.
SECTION 25. Indemnification. Holdings will indemnify Employee to the fullest extent that would be
permitted by law (including a payment of expenses in advance of final
disposition of a proceeding) as in effect at the time of the subject act or omission, or by the
charter or by-laws of Holdings as in effect in effect at such time, or by the terms of any
indemnification agreement between Holdings and the Employee, whichever affords greatest protection
to Employee, and the Employee shall be entitled to the protection of any insurance policies
Holdings may elect to maintain generally for the benefit of its officers and/or, during the
Employee’s service in such capacity (if applicable), directors, (and to the extent Holdings
maintains such an insurance policy or policies, in accordance with its or their terms to the
maximum extent of the coverage available for any Holdings officer or director); against all costs,
charges, and expenses whatsoever incurred or sustained by Employee (including but not limited to
any judgment entered by a court of law) at the time such costs, charges, and expenses are incurred
or sustained, in connection with any action, suit or proceeding to which Employee may be made a
party by reason of his being or having been an officer or employee of Holdings,
or serving as a
director, officer or employee of an affiliate of Holdings, at the request of Holdings,
11
other than any action, suit or proceeding brought against Employee by or on account of his breach
of the provisions of an employment agreement with a third party that has not been disclosed by
Employee to Holdings. The provisions of this Section 25 shall survive any termination of this
agreement.
SECTION 26. Stock Options/Change of Control. If a change of control occurs within 183 days of the
effective date of this Agreement, Employee shall be paid, in a single, lump sum, cash payment
within thirty days of the Change of Control, an amount equal to the product of the fair market
value of a share of common stock of Holdings multiplied by 120,000 reduced by the total exercise
price of the Options provided under Section 2(d). In this event, all Options granted Employee
pursuant to Section 2(d) shall be cancelled and not exercisable and Employee shall not be entitled
to any compensation under the terms of the Thermadyne Holdings Corporation 2004 Stock Incentive
Plan (“stock plan”). “Fair market value” means the closing bid price per share of common stock of
Holdings on the over-the-counter market as of the close of business on the effective date of the
change of control or, if there is no trading on such date, as of the close of the last date
immediately preceding the change of control when such Stock is traded. “Change of control” has the
meaning as defined in the stock plan.
* * * * * *
12
IN WITNESS WHEREOF, the parties hereto have executed and delivered this Amended and Restated
Executive Employment Agreement as of the date first above written.
| EMPLOYEE: | ||||||
 |
||||||
| Name: Xxxxxx X. Xxxxxx | ||||||
| Dated: | 8-7-2006 | |||||
| EMPLOYERS: | ||||||
| Thermadyne Holdings Corporation | ||||||
| By: | 
|
|||||
| Xxxx X. Xxxxxx | ||||||
| Title: | Chairman and Chief Executive Officer | |||||
THIS CONTRACT CONTAINS A BINDING ARBITRATION
PROVISION WHICH MAY BE ENFORCED BY THE PARTIES.
PROVISION WHICH MAY BE ENFORCED BY THE PARTIES.
