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Exhibit 10.21
TERMINATION BENEFITS AGREEMENT
This Termination Benefits Agreement ("Agreement") is entered into as of
the 31st day of December, 1996, by and between DeVilbiss Air Power Company, a
Delaware corporation ("Company") and Xxxxxxx X. Xxxxx ("Employee").
WITNESSETH:
WHEREAS, Employee is a key employee of the Company;
WHEREAS, the Company considers that providing Employee with certain
employment termination benefits will operate as an incentive for Employee to
remain employed by the Company during the period that the Company is
negotiating a change in control or ownership of the Company or its parent,
Falcon Building Products, Inc. (Falcon);
WHEREAS, this Agreement is intended to provide benefits only in the event
of a change in control or ownership of the Company or Falcon prior to September
30, 1997 (the "Expiration Date");
NOW THEREFORE, to induce Employee to remain employed by the Company
through the Expiration Date, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Company and
Employee agree as follows:
1. Definitions.
(a) "Change in Control" shall mean the sale by the Company or Falcon
of all or substantially all of their assets and business to a
person or entity other than a Related Person or the sale of
fifty-one percent (51%) or more of the voting securities and
capital stock of the Company or Falcon to a person or entity other
than a Related Person. "Related Person" shall mean any person or
entity directly or indirectly owned and controlled by Xxxxxx Xxxx
or Equity Holdings Limited ("EHL").
(b) "Termination Date" shall mean the date of termination of Employee's
employment relationship with the Company.
(c) "Termination Payments" shall mean any payment or distribution of
compensation or benefits made pursuant to Section 3 of this
Agreement.
(d) "Termination With Cause" shall mean termination of Employee by the
Company for any of the following reasons:
(i) the failure of Employee to render services to the Company in
substantial accordance with the terms of his employment,
which failure amounts to gross neglect of his duties to the
Company;
(ii) any violation of Section 6 of this Agreement or any
employment agreement which Employee may have with the
Company;
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(iii) taking any role in any buy-out of the Company or Falcon
without the approval of the Company's majority
shareholder; or
(iv) Employee's commission of any act of fraud, theft or
embezzlement against the Company.
(e) "Voluntary Termination" shall mean the voluntary
resignation by Employee of his employment with the Company
other than a voluntary resignation following either:
(i) any reduction in compensation consisting of base salary
and incentive bonus;
(ii) a substantial diminution of his responsibilities; or
(iii) a relocation by the Company of Employee's place of
employment outside a twenty (20) mile radius of
Employee's current place of employment.
2. Termination of Employee. In the event of Employee's
termination of employment with the Company within two (2) years
immediately following the date on which there was a Change in
Control or ownership of the Company or Falcon, the Company shall
provide Employee with the Termination Payments outlined in Section
3, unless the termination is for any of the following reasons:
(a) Termination With Cause;
(b) Voluntary Termination;
(c) The death of the Employee. Nothing in this section shall
affect any entitlement of Employee's heirs to the benefits of
any life insurance plan; or
(d) Termination as a result of Employee's incapacity (i.e., if in
the reasonable opinion of the Company, Employee is prevented
from properly performing his duties by reason of any physical
or mental incapacity for a period of more than one hundred
twenty (120) days, in the aggregate, in any twelve (12) month
period). Nothing in this section shall affect Employee's
rights under any disability plan in which he is a participant.
3. Termination Payments. In the event that Employee is entitled
to Termination Payments pursuant to the terms of Section 2:
(a) Compensation. The Company shall pay Employee an amount equal
to two (2) years base salary plus par bonus as of the
Termination Date, without giving effect to any reduction in
base salary or incentive bonus prior to the Termination Date;
payable within thirty (30) days of the Termination Date
following the Change in Control.
(b) Employee Benefits:
(i) Vacation. Any accrued vacation pay due but not yet taken
at the Termination Date shall be paid to Employee within
thirty (30) days following the Termination Date.
(ii) Health Benefits. If Employee participated in any health
benefit plan in effect immediately prior to the
Termination Date, and if Employee elects to continue
participating in such plan pursuant to the terms of said
plan
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and the Comprehensive Omnibus Budget Reconciliation
Act ("COBRA"), the Company shall pay for the costs of
Employee's participation in such plan from the
Termination Date until the earlier of: (a) the date
which is twenty-four (24) months following the
Termination Date; or (b) the date of Employee's
eligibility in any health benefit plan offered by
Employee's new employer, if any. Employee shall notify
the Company in writing within thirty (30) days of any
new employment.
(iii) Retirement And Profit-Sharing Plans. Notwithstanding
anything in this Agreement to the contrary, Employee's
rights in any retirement, pension or profit-sharing
plans offered by the Company shall be governed by the
rules of such plans as well as by applicable law;
provided, however, that on the Termination Date,
Employee shall become fully vested in all pension and
401(k) account balances.
(iv) Outplacement Assistance. The Company will provide
Employee up to one year of employment outplacement
services with a nationally recognized executive
placement company.
4. At-Will Employment. The Company and Employee have, and will
continue to have, an at-will employment relationship. That is,
either party can terminate the employment relationship for any
reason at any time. Nothing contained in this Agreement shall be
interpreted to amend or alter this at-will employment relationship.
5. Limitation of Payment. Notwithstanding anything in this
Agreement to the contrary, if receipt of the Termination Payments
would subject Employee to tax under Section 4999 of the Internal
Revenue Code of 1986, as amended, the Termination Payments shall be
"grossed up" to an amount that would allow the Employee to receive
the net after-tax amount he would have received but for the
application of said Section 4999.
6. Continuing Obligations. In order to induce the Company to
enter into this Agreement, Employee hereby agrees that all
documents, records, techniques, business secrets and other
information which have come into his possession from time to time
during his continued employment by the Company or which may come
into his possession during his employment hereunder, shall be deemed
to be confidential and proprietary to the Company, and Employee
further agrees to retain in confidence any confidential information
known to him concerning the Company and its subsidiaries and their
respective businesses so long as such information is not publicly
disclosed. Employee further agrees to cooperate fully as requested
from time to time by the controlling shareholder of the Company, the
Company's Board of Directors, or Company Management in connection
with any transaction involving the possible sale of the Company or
Falcon. Employee further agrees not to speak about a possible sale
of the Company or Falcon with or otherwise respond to requests to or
from any third parties involving the possible sale of the Company or
Falcon, unless specifically authorized to do so by the Company or
the controlling shareholder of the Company. The obligations of
Employee under this Section 6 shall be in addition to, and shall not
limit, any other obligation of Employee to the Company with respect
to the matters set forth herein or otherwise.
7. Assignments and Transfers. Employee agrees that he will not
assign, sell, transfer, delegate or otherwise dispose of, whether
voluntarily or involuntarily, or by operation of law, any rights or
obligations under this Agreement, nor shall Employee's rights be
subject to encumbrance or the claims of creditors. Any purported
assignment shall be null and void. This Agreement shall inure to
the benefit of and be enforceable by Employee's personal or legal
representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees. This Agreement shall be
binding upon and shall inure to the benefit
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of the Company and its successors and assigns, and the Company
shall require any successor or assign to expressly assume and agree
to perform this Agreement in the same manner and to the same extent
that the Company would be required to perform it if no such
succession or assignment had taken place, except no assumption shall
be required if this Agreement is automatically assumed by operation
of law. The term "the Company" as used herein shall include such
successors and assigns. The term "successors and assigns" as used
herein shall include a corporation or other entity acquiring at
least 51% of the outstanding shares of the Company or Falcon or all
or substantially all of the assets and business of the Company or
Falcon.
8. Notices. For purposes of this Agreement, notices and all
other communications provided for herein shall be in writing and
shall be deemed to have been duly given and received when delivered
or mailed by United States registered or certified mail, return
receipt requested, postage prepaid, addressed to the Company at:
DeVilbiss Air Power Company
000 Xxxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxx 00000
Attn: President
and to Employee at:
Xxxxxxx X. Xxxxx
14 Deepwood
Xxxxxxx, XX 00000
or such address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of
address shall be effective only upon receipt.
9. Governing Law. The validity, interpretation, construction
and performance of this Agreement shall be governed by the laws of
the State of Tennessee.
10. Entire Agreement. The terms of this Agreement are intended
by the parties to be the final expression of their agreement with
respect to Employee's termination benefits and may not be
contradicted by evidence of any prior or contemporaneous Agreement.
11. Amendments; Waivers. This Agreement may not be modified,
amended, or terminated except by an instrument in writing, signed by
Employee and by a duly authorized representative of the Company
other than Employee. No failure to exercise and no delay in
exercising any right, remedy, or power hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any
right, remedy, or power hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, or
power provided herein or by law or in equity.
12. Severability; Enforcement. If any provision of this
Agreement, or the application thereof to any person, place or
circumstance, shall be held by a court of competent jurisdiction to
be invalid, unenforceable, or void, the remainder of this Agreement
and such provisions as applied to other persons, places, and
circumstances shall remain in full force and effect.
13. Arbitration. The parties agree to submit any dispute arising
under this Agreement to arbitration. Arbitration shall be by a
single arbitrator in the Jackson, Tennessee area experienced in the
matters at issue selected by the Company and Employee in accordance
with the commercial arbitration rules of the American Arbitration
Association. The decision of the arbitrator shall be final and
binding as to any manner submitted to him
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under this Agreement. All costs and expenses incurred in
connection with any such arbitration proceeding shall be borne by
the party against whom the decision is rendered as provided by the
arbitrator.
14. Release.
(a) Employee, on behalf of himself, his heirs, executors, legal
representative, successors and assigns, hereby fully and
forever releases and discharges EHL, Falcon, the Company, and
their respective affiliates, subsidiaries, parents,
predecessors and successors, and each of their officers,
directors, trustees, employees, agents and attorneys, past and
present (the "Releasees"), from any and all claims, demands or
causes of action, whether now known or unknown, which have
existed, which do exist, or which may exist in the future,
arising out of or relating in any way to Employee's employment
with the Company, his employment compensation, his termination
of employment or his employment arrangement, the sale of the
stock or assets of the Company or Falcon and/or any other
occurrence up to and including the effective date of this
Agreement, except those claims statutorily precluded from
waiver or release by private parties and except those alleging
breach of this Agreement. Without in any way limiting the
generality of the foregoing language, this release includes
any claims for relief or causes of action under the Age
Discrimination in Employment Act, as amended, 29 U.S.C.
Section 621, et seq., and any other federal, state or local
statute, ordinance or regulation dealing in any respect with
discrimination in employment, and in addition thereto, any
claims under any Company severance policy, practice or
procedure, and any claims, demands or actions brought on the
basis of alleged wrongful or retaliatory discharge and/or
alleged breach of an implied or explicit, written or oral
employment or other contract or covenant under the common law
of any state, including, but not limited to, Tennessee.
(b) Employee further agrees not to directly or indirectly pursue or
initiate any action or legal proceeding of any kind against the
Releasees arising out of or related to the claims released in
Section 15(a) above, or the sale of the stock or assets of the
Company or Falcon and also waives any right to recover any
relief as a result of any such proceedings initiated on his
behalf.
15. Termination Date. This Agreement shall be null and void in the
event that a Change in Control does not occur on or before the Expiration Date.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
and delivered as of the day and year set forth above.
DEVILBISS AIR POWER COMPANY, Xxxxxxx X. Xxxxx
a Delaware corporation
/s/ Xxxxxxx X. Xxxxx
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By: /s/ Xxx X. Xxxxx signature
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Xxx X. Xxxxx
Its: Vice-President
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