EMPLOYMENT AGREEMENT (AMENDED AND RESTATED)
EMPLOYMENT AGREEMENT (the "Agreement") dated as of January 1, 1996, by and
between, ASAHI/AMERICA, INC., a Massachusetts corporation (the "Company"), and
XXXXXX X. XXXXX, an individual (the "Executive").
W I T N E S S E T H:
WHEREAS, the Executive is presently Chairman, Chief Executive Officer and
President of the Company;
WHEREAS, the Company desires to retain the Executive as Chairman, Chief
Executive Officer and President of the Company;
WHEREAS, the Executive is willing to provide his services as an employee of
the Company for the inducements and on the terms and conditions set forth below
in this Agreement; and
WHEREAS, the parties hereto desire to amend and restate the existing
Employment Agreement among the parties.
NOW, THEREFORE, in consideration of the mutual covenants set forth herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:
Employment. Upon the terms and subject to the conditions of this Agreement,
the Company employs the Executive and the Executive accepts employment with the
Company in the capacity hereinafter set forth.
Term of Employment. The initial term of Executive's employment by the
Company under this Agreement shall commence as of January 1, 1996 (the
"Commencement Date") and shall continue until the third anniversary of the
Commencement Date (the "Termination Date"), unless terminated earlier pursuant
to Section 3. On each anniversary date of the Commencement Date the term shall
be extended automatically for an additional one (1) year period effective on
each anniversary of the Commencement Date until notice of non-extension is given
by either party to the other at least forty-five (45) days prior to the next
anniversary of the Commencement Date. The term of employment of the Executive
under this Agreement, including any annual extensions, and exclusive of any
earlier termination pursuant to Section 3, is referred to in this Agreement as
the "Employment Period".
Duties. The Executive shall be employed as Chairman, Chief Executive
Officer and President of the Company. In that capacity, he shall be responsible,
subject to the direction and control of the Board of Directors of the Company or
its designee (the "Board"), for the supervision and control of the operation,
finances, personnel and management of the Company, including, without
implication of limitation, (i) the selection, hiring and firing of all personnel
of the Company, (ii) the operation, control and selection of the Company's
facility, including the selection and purchase of equipment, fixtures, inventory
and parts, and the implementation of all modifications, alterations and
renovations of the Company's facility and equipment and (iii) the selection of
all products and services offered for sale by the Company and the implementation
of such sales, including responsibility for advertising and marketing of
products and directing of the Company's sales force.
At all times during the Employment Period, except for illness and permitted
vacation periods, during the Executive's employment with the Company, the
Executive
shall: (i) devote his full time and attention during normal business hours to
the business and best interests of the Company; and (ii) discharge such
executive and administrative duties as may be assigned to him by the Board as
are reasonably consistent with the Executive's title and office and report to
and obey the lawful directions of the Board; provided that such instructions do
not violate or cause a violation of law and do not constitute a breach of the
directors' fiduciary duties to the Company. The foregoing shall not be construed
to prohibit the Executive from: (i) serving as a director of any corporation
which is not a competitor of the Company, provided that such service by the
Executive does not materially interfere with the performance by the Executive of
his duties hereunder and the Executive has obtained the prior consent of the
Company, which consent shall not be unreasonably withheld; or (ii) engaging in
civic, educational, religious, charitable or other community or non-profit
activities that do not impair the Executive's ability to fulfill the Executive's
duties and responsibilities under this Agreement.
Compensation. Until the termination of the Executive's employment
hereunder, in consideration for the services of the Executive hereunder, the
Company shall compensate the Executive as follows:
Base Compensation. During the first three (3) years of the Employment
Period, the Company will pay to the Executive a base salary at the annual rate
of Three Hundred Thousand Dollars ($300,000), payable semi-monthly or in such
other manner as the Executive and the Company may mutually agree (the "Base
Salary"). The Base Salary may be increased from time to time at the sole
discretion of the Board. The Board shall annually review the Executive's job
performance and shall annually consider increasing the Executive's Base Salary.
Without limiting the Board's discretion concerning increases to the Executive's
Base Salary, the Board shall consider the Company's past practice with respect
to executive salary increases in making salary
increase decisions. Nothing herein shall be construed as guaranteeing the
Executive the right to receive any such salary increases. Notwithstanding the
foregoing, if the Employment Period is extended beyond the third anniversary of
the Commencement Date pursuant to Section 1(a) and the Executive's Base Salary
has not previously been increased to at least Three Hundred Thirty Thousand
Dollars ($330,000) by the Board, the Executive's Base Salary shall be increased
to at least Three Hundred Thirty Thousand Dollars ($330,000) for the remainder
of the Employment Period as so extended.
Bonus. The Executive shall also be eligible to receive a bonus payable on
or prior to the 120th day following the end of each full calendar year during
which this Agreement is in effect or, notwithstanding the foregoing, with
respect to any portion of the bonus which may be in dispute and which has been
challenged by institution of the dispute mechanism set forth in paragraph (d)
below, ten (10) days after the rendering of a determination pursuant to
paragraph (d) below, in an amount equal to the sum of (i) an amount equal to the
product of (A) $100,000 and (B) a fraction, the numerator of which shall be the
net operating income after interest but before non-cash charges, directors'
expenses, officers' bonuses, amortization, profit sharing, and depreciation) and
taxes ("NOI") for such year and the denominator of which shall be the Target NOI
(as defined below), such fraction in no event to be greater than 1, and (ii) the
amount which is equal to ten percent (10%) of the amount of the NOI for such
year which is in excess of the Target NOI. For purposes of the determination of
Target NOI for a given year, the amount, if any, of any NOI above the Target NOI
shall be, at the election of the Executive, (i) included in such
calculation of Target NOI, or (ii) carried forward and included in the
calculation of NOI for the succeeding year. For purposes of the calculation,
inventory shall be calculated on the FIFO basis. The determination of NOI under
this Section 2(b) and elsewhere in this Agreement shall be made in accordance
with and subject to the provisions of paragraph (d) below.
In order to illustrate the calculation of the Executive's bonus, the
following is set forth as an example. Assume the following:
Year Target NOI NOI
-----------------------------------------------
1996 $200 $280
1997 $300 $280
The Executive's 1996 bonus would be calculated as follows:
$100,000 x 200 + 10 x 80
--- ---
200 100
100 + 8
The Executive would receive $108,000.
The Executive's 1997 bonus would be calculated as follows:
$100,000 x 280 + 0
---
300
The Executive would receive $93,333.34.
As used in this Agreement, "Target NOI" shall mean the target earnings and
projections set forth on Schedule A hereto. The Executive and the Company
acknowledge that the Target NOI amounts have been prepared by the Board, based
on the historical performance of the Company, and his projection of future
trends and circumstances in the economy, the industry and the Company's
business. The Executive and the Company agree that notwithstanding any change in
circumstances or unforeseen events, no adjustment shall be made to the Target
NOI; provided, however, that the Company and the Executive shall negotiate in
good faith to adjust the Target
NOI upon the occurrence of (i) a force majeure event, (ii) the imposition by
governmental authorities of prohibitive import duties or tariffs on the products
purchased by the Company pursuant to the Distributorship Agreement among Asahi
Organic Chemicals Industry Co., Ltd. (formerly known as Asahi Yukizai Kogyo Co.,
Ltd.) ("AOC") and the Company dated as of January 2, 1982 (such agreement, as
amended or replaced by a distribution agreement or agreements with AOC, Nichimen
Corporation ("NMC") and Nichimen America Inc. ("NAI"), the "Distributorship
Agreement") and the Company or (iii) a material breach by AOC, NMC or NAI of the
Distributorship Agreement, including the failure of such parties to deliver
products thereunder. Failure by the Company to achieve the Target NOI shall not
be actionable against the Executive, the Company, AOC, NMC or NAI, and shall not
constitute "Cause" for termination of the Executive's employment. The foregoing
shall not be deemed to constitute a waiver by any such party of any rights such
party may have under the Distributorship Agreement.
Other Benefits. During the Executive's employment with the Company, the
Executive shall be entitled to the following benefits:
a) five (5) weeks vacation time per calendar year, accruing on January 1 of
each year during his employment with the Company, with unused vacation, at the
election of the Executive, to be paid in cash or carried forward to the next
year;
a) participation in all employee life, medical and dental insurance,
retirement and profit sharing plans and other benefit programs now or hereafter
maintained by the Company for senior executives of the Company according to the
terms of those plans as amended from time to time by the Company; provided,
however, that the Executive will in no event be entitled to benefits in amounts
or of the type less or worse than those which he was entitled to receive from
the Company as of December 1, 1992;
a) use of an automobile, the lease or finance costs of which shall not
exceed $1,000 per month;
a) payment for or reimbursement for all reasonable and properly documented
expenses incurred or paid by him in connection with the performance of his
duties hereunder;
(v) payment for or reimbursement for all reasonable and properly
documented expenses incurred or paid by him for financial planning, income
tax preparation and estate planning services; provided, however, such
amount under this clause shall in no event annually exceed $10,000; and
(vi) participation in a term life insurance program with a face amount
of at least ten (10) times the Executive's then current Base Salary,
provided that the Executive shall be entitled to name the beneficiary of
that policy.
All determinations of NOI under Section 2 and elsewhere in this Agreement
shall be made in good faith by the Board in accordance with generally accepted
accounting principles consistently applied and subject to normal year-end
adjustments within ninety (90) days of the end of the Company's fiscal year.
The Company shall maintain keyman insurance (a combination of term and
straight line ordinary) on the life of the Executive in the amount of
$5,000,000, with the cash surrender value thereof to be payable to the Company,
for the period ending on December 31, 2005. If the Executive is employed with
the Company as of December 31, 2005, but leaves the employ of the Company as of
such time, (i) any cash surrender value of such policies in excess of the
aggregate of the premiums paid for the period through November 21, 2005 (the
"Excess Value") will be used by the Company to fund a retirement plan for the
Executive and (ii) the beneficiary of the policies shall be changed to the
estate of the Executive. If the Executive remains employed by the Company after
December 31, 2005, (i) any Excess Value will be used by the Company to fund a
retirement plan for the Executive and (ii)
the beneficiary of the policies shall remain the Company until such time as the
Executive thereafter leaves the employ of the Company, whereupon the beneficiary
will be changed to the estate of the Executive.
Termination. The Executive's employment hereunder shall commence on the
Commencement Date and continue until the expiration of the Employment Period,
except that the employment of the Executive hereunder shall terminate earlier:
(a) Death or Disability. Upon the death of the Executive during the
Employment Period or, at the option of the Company, in the event of the
Executive's disability, upon thirty (30) days' written notice from the Company.
The Executive shall be deemed disabled if an independent medical doctor
(selected by mutual agreement of the Executive and the Company) after
consultation with the Executive's physician and examination of the Executive
certifies that the Executive has for 180 consecutive days or for a
non-consecutive period of 180 days during any twelve (12) month period been
mentally or physically disabled in a manner which renders him unable to perform
his responsibilities under this Agreement.
(b) For Cause. For "Cause" immediately upon written notice by the Company
to the Executive, specifying in detail the basis for such Cause. For purposes of
this Agreement, "Cause" shall mean:
(i) a breach of any material provision of this Agreement, including
without implication of limitation any breach of Sections 4(a) through (d)
hereof which breach, if curable, is not cured within thirty (30) days after
written notice thereof, specifying the particulars of such breach, is given
to the Executive by the Board;
(ii) one or more acts of dishonesty or fraud by the Executive during
the Employment Period in the performance of his duties on behalf of the
Company;
(iii) any plea of nolo contendere, guilty plea or any conviction of
the Executive of any felony or any other crime which conviction has, or is
reasonably likely to have, a material adverse effect on the Company or its
business or reputation;
(iv) any material act or omission by the Executive during the
Employment Period involving willful malfeasance or gross negligence in the
performance of his duties hereunder which breach, if curable, is not cured
within thirty (30) days after written notice thereof, specifying the
particulars of such breach, is given to the Executive by the Board;
(v) the repeated failure of the Executive to follow the reasonable
instructions of the Board, which instructions shall have been on at least
one occasion set forth in a resolution or a written communication of the
Board delivered to the Executive; provided, however that compliance with
such instructions would not violate or cause a violation of law, would not
constitute a breach of fiduciary duty to the Company and would not
otherwise be inconsistent with this Agreement; or
(vi) the inability of the Executive as a result of continued alcohol
or drug use to carry out the responsibilities of his office.
(c) Resignation; Termination Without Cause. Upon ninety (90) days' written
notice by either the Company or the Executive to the other party hereto, except
that the Executive may terminate his employment with Good Reason upon thirty
(30) days' written notice to the Company. For purposes of this Agreement, the
term "Good Reason" shall mean the occurrence of any of the events or conditions
described in subparagraphs (i) through (iv) hereof without the Executive's
express written consent:
(i) a material adverse change in the Executive's status, title,
position, scope of authority or responsibilities (including reporting
responsibilities); the assignment to the Executive of any duties or
responsibilities which, are materially inconsistent with such status,
title, position, authorities or responsibilities; or any removal of the
Executive from or failure to reappoint or reelect him to any of such
positions, except in connection with the termination of his employment for
Cause, as a result of his death or disability or by the Executive other
than for Good Reason;
(ii) the relocation of the Company's principal executive offices to a
location outside a 30-mile radius of 000 Xxxxx Xxxxxx, Xxxxxxxx Xxxx,
Xxxxxxxxxxxxx or the Company's requiring Executive to be based at any place
other than the Company's principal executive offices, except for reasonably
required travel on the Company's business which is not substantially
greater than such travel requirements prior to the date hereof; or
(iii) any material breach by the Company of any provision of this
Agreement, including without implication of limitation a reduction by the
Company in the Executive's compensation or a material adverse change in the
level of benefits as set forth in Section 2 hereof.
(d) Rights and Remedies on Termination.
(i) If the Executive's employment hereunder is terminated pursuant to
Section 3(a) as a result of the Executive's death or disability then the
Executive (or his estate) shall be entitled to receive Death or Disability
Pay consisting of the continuation of the Executive's Base Salary in effect
at the time of such termination for twenty-four (24) months less any
payments received by the Executive under any applicable disability policy
maintained by the Company and a lump sum amount equal to the Executive's
most recent bonus payable no later than thirty (30) days following such
termination.
(ii) If the Executive's employment hereunder is terminated:
(1) as a result of a nonrenewal of this Agreement pursuant to
Section 1(a);
(2) by the Company pursuant to Section 3(c); or
(3) by the Executive for Good Reason pursuant to Section 3(c);
then the Executive shall be entitled to receive Severance Pay consisting of
the continuation of the Executive's Base Salary in effect at the time of
such termination for the greater of twenty-four (24) months or the
remainder of the Employment Period (the "Severance Period") and a lump sum
amount equal to the Executive's most recent bonus payable no later than
thirty (30) days following such termination. In addition, the Company shall
provide the Executive with a reasonable office and secretarial services
throughout the Severance Period.
(iii) In the event of a termination of the Executive's employment
entitling the Executive to rights pursuant to Section 3(d)(i) or (ii)
above, the Executive and/or any members of his family insured through the
Company (the "Insured Parties") shall have the option to continue their
medical and dental insurance coverage pursuant to the law known as "COBRA",
provided, however, that the Company shall continue to pay on the Insured
Parties' behalf the same portion of their medical and dental insurance
premiums
that it paid during the Employment Period if they elect to continue
coverage pursuant to COBRA during the period that such COBRA otherwise
applies. Any share of premium payments to be paid by the Insured Parties
shall be deducted from the Death or Disability Pay or the Severance Pay as
if the Executive remained actively employed. Notwithstanding the foregoing,
in the event that the Executive receives any equivalent medical and/or
dental coverage from any other source, then the Company, shall no longer be
obligated to provide such coverage.
(iv) Except as otherwise set forth in this Section 3(d), the Executive
shall not be entitled to any severance or other compensation after the
termination of his employment with the Company other than payment of his
Base Salary through the date of termination, payment for then accrued but
unused vacation pay as calculated pursuant to Section 2(c)(i), provision of
other benefits pursuant to Section 2(c)(ii) and (iii) through the date of
termination, any expense reimbursements under Section 2(c)(iv) and (v) for
expenses incurred prior to termination, and the option to continue the life
insurance coverage provided pursuant to Section 2(c)(vi) at his own expense
after the termination of his employment with the Company.
(e) Termination Pursuant to a Change of Control. If there is a Change of
Control, as defined in Section 3(e)(i) below, during the Executive's employment
with the Company, the provisions of this Section 3(e) shall apply and shall
continue to apply throughout the remainder of the Employment Period. If, within
one (1) year following a Change of Control, the Executive's employment is
terminated by the Company without cause (pursuant to Section 3(c) above), or if
the Executive resigns his employment for Good Reason following the occurrence of
any of the events listed in Section 3(c) above, in lieu of any payments under
Section 3(d) above, the Company shall pay to the Executive (or the Executive's
estate, if applicable) a lump sum amount equal to 2.99 times the Executive's
"base amount" within the meaning of Section 280G(b)(3) of the Internal Revenue
Code of 1986, as amended (the "Code").
(i) Change of Control shall mean the occurrence of one or more of the
following events:
(1) any "person" (as such term is used in Sections 13(d) and
14(d)(2) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) becomes a "beneficial owner" (as such term is defined
in Rule 13d-3 promulgated under the Exchange
Act) (other than the Company, any trustee or other fiduciary holding
securities under an employee benefit plan of the Company, or any
corporation owned, directly or indirectly, by the stockholders of the
Company, in substantially the same proportions as their ownership of
stock of the Company), directly or indirectly, of securities of the
Company or the Company's parent (the "Parent") representing fifty
percent (50%) or more of the combined voting power of the Company's
then outstanding securities; or
(2) persons who, as of the Commencement Date, constituted the
Company's Board of Directors or the Parent's Board of Directors (the
"Incumbent Board") cease for any reason including, without limitation,
as a result of a tender offer, proxy contest, merger or similar
transaction, to constitute at least a majority of the Board of
Directors, provided that any person becoming a director of the Company
or the Parent subsequent to the Commencement Date whose election was
approved by at least a majority of the directors then comprising the
Incumbent Board shall, for purposes of this Section 3(e), be
considered a member of the Incumbent Board; or
(3) the stockholders of the Company or the Parent approve a
merger or consolidation of the Company or the Parent with any other
corporation or other entity, other than (a) a merger or consolidation
which would result in the voting securities of the Company or the
Parent outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting
securities of the surviving entity) more than fifty percent (50%) of
the combined voting power of the voting securities of the Company or
the Parent or such surviving entity outstanding immediately after such
merger or consolidation or (b) a merger or consolidation effected to
implement a recapitalization of the Company or the Parent (or similar
transaction) in which no "person" (as hereinabove defined) acquires
more than fifty percent (50%) of the combined voting power of the
Company's or the Parent's then outstanding securities; or
(4) the stockholders of the Company or the Parent approve a plan
of complete liquidation of
the Company or the Parent or an agreement for the sale or disposition
by the Company or the Parent of all or substantially all of the
Company's or the Parent's assets.
(ii) The Executive shall provide the Company with reasonable notice
and an opportunity to cure any of the events listed in Section 3(c) which
would constitute Good Reason for his resignation and shall not be entitled
to compensation pursuant to this Section 3(e) unless the Company fails to
cure within a reasonable period, but in no event shall such period exceed
thirty (30) days; and
(iii) It is the intention of the Executive and of the Company that no
payments by the Company to or for the benefit of the Executive under this
Agreement shall be nondeductible to the Company by reason of the operation
of Section 280G of the Code relating to parachute payments or any like
statutory or regulatory provision. Accordingly, and notwithstanding any
other provision of this Agreement or any such agreement or plan, if by
reason of the operation of said Section 280G or any like statutory or
regulatory provision, any such payments exceed the amount which can be
deducted by the Company, such payments shall be reduced to the maximum
amount which can be deducted by the Company. To the extent that payments
exceeding such maximum deductible amount have been made to or for the
benefit of the Executive, such excess payments shall be refunded to the
Company with interest thereon at the applicable Federal rate determined
under Section 1274(d) of the Code, compounded annually, or at such other
rate as may be required in order that no such payments shall be
nondeductible to the Company by reason of the operation of said Section
280G or any like statutory or regulatory provision. To the extent that
there is more than one method of reducing the payments to bring them within
the limitations of said Section 280G or any like statutory or regulatory
provision, the Executive shall determine which method shall be followed,
provided that if the Executive fails to make such determination within
forty-five (45) days after the Company has given notice of the need for
such reduction, the Company may determine the method of such reduction in
its sole discretion.
A. Covenants of the Executive.
1. Non-Solicitation of Customers or Employees of the Company.
During the Employment Period and at all times thereafter, except in
connection with a dispute arising under this Agreement or the terms and
conditions of the Executive's employment, the Executive will not disparage the
Company or any
subsidiaries or affiliates of the Company ("Affiliates"). During the
Non-Solicitation Period (as defined below), the Executive shall not, and shall
use his best efforts to cause each other business or entity with which he is or
shall become associated in any capacity not to, directly or indirectly employ
any person (other than the Executive's son, Xxxxxx Xxxxx) who at any time during
the Executive's final two years of employment with the Company was employed in
any capacity by the Company or any of its Affiliates. During the
Non-Solicitation Period, the Executive shall not, and shall use his best efforts
to cause each other business or entity with which he is or shall become
associated in any capacity not to, (i) directly or indirectly solicit for
employment any person (other than the Executive's son, Xxxxxx Xxxxx) who at any
time during the Executive's final two years of employment with the Company was
employed in any capacity by the Company or any of its Affiliates; (ii) directly
or indirectly solicit any person or entity who at any time during the
Executive's final two years of employment with the Company was a customer of the
Company or its Affiliates in respect of the products or services supplied by the
Company or its Affiliates; or (iii) directly or intentionally indirectly
interfere or seek to interfere with the continuance of supplies to the Company
or its Affiliates (or with the terms relating to such supplies) from any persons
or entities who have been supplying materials or services to the Company during
the Executive's final two years of employment with the Company.
For purposes of this Agreement, the term "Non-Solicitation Period" shall
mean the period of time during which the Executive is actively employed by the
Company and (i) with respect to termination of the Executive's employment
hereunder for "Cause" pursuant to Section 3(b) or by the Executive pursuant to
Section 3(c) other
than for Good Reason, a period beginning on the date of the termination and
ending six (6) months following the expiration of the Employment Period in
effect at the time of the termination; or (ii) with respect to termination of
the Executive's employment hereunder as a result of the Executive's disability
pursuant to Section 3(a), as a result of nonrenewal of this Agreement pursuant
to Section 1(a), by the Company without Cause pursuant to Section 3(c) or by the
Executive for Good Reason pursuant to Section 3(c), the period during which the
Executive receives Disability Pay or Severance Pay pursuant to Section 3(d)
hereof.
(b) Confidentiality. Without the specific prior written consent of the
Company, the Executive shall not, directly or indirectly, at any time after the
date hereof, divulge to any person, any confidential information concerning the
business, affairs, customers or clients of the Company or any of its Affiliates,
including, without limitation, customer lists, names and addresses, sales
targets and statistics, market share statistics, surveys and reports, insofar as
the same have come to the Executive's knowledge during his employment with the
Company, all of which information is confidential and proprietary to the Company
and shall remain the sole and exclusive property of the Company. Notwithstanding
the foregoing, the Executive shall have the right to use the generic knowledge
and expertise acquired by him during his employment with the Company so as to
enable him to be otherwise gainfully employed within the Company's industry. The
Company also expressly agrees that the Executive may disclose information as
necessary to proposed underwriters (and their agents) in connection with the
proposed public offering of the Company's capital stock, or as may be required
by law or to comply with legal process.
(c) Intellectual Property. The Executive shall as soon as practicable
disclose to the Company all ideas, inventions and business plans developed by
the Executive during his employment with the Company which relate directly or
indirectly to the business or then currently anticipated business of the Company
or its Affiliates, including, without limitation, any process, operation,
product or improvement
("Intellectual Property"). The Executive agrees that such Intellectual Property
will be the property of the Company and that the Executive shall, without
further payment to the Executive at the Company's request and cost, do whatever
is reasonably necessary for the Company to secure the rights thereto by patent,
copyright or otherwise for the Company.
Representation and Warranties.
The Company The Company hereby represents and warrants to the
Executive as follows:
a) the Company is duly organized, validly existing and in good standing
under the laws of the Commonwealth of Massachusetts;
a) this Agreement has been duly authorized, executed and delivered by
the Company; and
a) the execution and delivery of this Agreement by the Company, the
performance by the Company of its obligations hereunder and the consummation by
the Company of the transactions contemplated hereby will not violate any
agreement to which the Company is a party or any provision of its Articles of
Organization or By-Laws.
The Executive. The Executive hereby represents and warrants to the
Company as follows:
a) the Executive has full legal capacity to enter into this Agreement;
b) this Agreement has been duly executed and delivered by the
Executive;
a) the execution and delivery of this Agreement by the Executive, the
performance by the Executive of his obligations hereunder and the consummation
by the Executive of the transactions contemplated hereby will not violate any
agreement to which he is a party; and
a) the Executive has made such investigations of the business and
properties of the Company as he deems necessary or appropriate before entering
into this Agreement.
A. Successors: Assignment.
1. The Company. Except as herein provided, the Company may not assign any of
its rights or obligations under this Agreement without the written consent of
the Executive; provided, however, that the Company may assign this Agreement
without such consent if assigned to the acquiring party as part of a transfer by
the Company of all or substantially all of its assets. A change in control of
the Company or merger of the Company with and into any other corporation
(whether or not the Company shall be the surviving entity) shall not be deemed
an assignment of this Agreement.
The Executive. Neither this Agreement, nor any right, obligation or
interest hereunder, may be assigned by the Executive, his beneficiaries, or his
legal representatives.
Notices. All notices and other communications hereunder shall be in writing
and shall be deemed to have been given when delivered by hand, or three business
days after being mailed by first-class certified mail, postage prepaid and
return receipt requested, addressed as follows:
If to the Company:
Asahi/America, Inc.
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: President
with copies to:
Xxxxxxx, Procter & Xxxx XXX
Xxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000-0000
Attention: Xxxxxxx X. Floor, P.C. and H. Xxxxx Xxxxxx, Esq.
and
Dechert Price & Xxxxxx
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
If to the Executive:
Xxxxxx X. Xxxxx
000 Xxxxx Xxxxxx
Xxxxxxxx Xxxx, Xxxxxxxxxxxxx 00000
with a copy to:
Xxxxxxx, Procter & Xxxx XXX
Xxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000-0000
Attention: Xxxxxxx X. Floor, P.C. and H. Xxxxx Xxxxxx, Esq.
Governing Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the Commonwealth of Massachusetts without
giving effect to the conflicts of law principles thereof.
Expenses. All costs and expenses (including attorneys' fees) incurred by
the Company and the Executive in connection with the negotiation and preparation
of this Agreement shall be paid by the Company.
Entire Agreement. This Agreement contains the entire agreement of the
parties and their affiliates relating to the subject matter hereof and
supersedes all prior agreements, representations, warranties and understandings,
written or oral with respect thereto including, without implication of
limitation: (1) the Memorandum of Understanding dated as of February 26, 1993
among AOC, NMC, NAI and the Company; (2) the Employment Agreement between the
Executive and the Company dated as of March 31, 1993; and (3) the Employment
Agreement between the Executive and the Company dated as of November 1, 1995.
Severability.
(a) Generally. If any term or provision of this Agreement or the
application thereof to any person, property or circumstances shall to any extent
be invalid or unenforceable, the remainder of this Agreement, or the application
of such term or provision to persons, property or circumstances other than those
as to which it is invalid or unenforceable, shall not be affected thereby, and
each term and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.
(b) Duration and Scope of Certain Covenants. Without limiting Section 11(a)
hereof, if any court or arbitrator determines that any of the covenants
contained in Section 4 hereof, or any part of such covenants, are unenforceable
because of the duration or geographic scope of such provision, such court or
arbitrator shall have the power to and is hereby requested to modify the
duration or scope of such provisions as the case may be to the extent necessary
to make such provision enforceable, and in its modified form, such provision
shall then be enforceable.
Arbitration. In the event of any dispute arising out of or relating to this
Agreement or in the case of breach hereof, the parties shall try in the first
instance to arrive at an amicable settlement, within sixty (60) days after
notice thereof has been given in writing by the complaining party. Should this
fail, the dispute or breach shall be referred to and finally settled by
arbitration which shall be held in Boston, Massachusetts and conducted in the
English language in accordance with the commercial arbitration rules of the
American Arbitration Association ("AAA"); provided, however, that disputes with
regard to the determination of NOI hereunder shall be resolved in accordance
with the procedures set forth in Section 2(d) hereof. The AAA shall select three
arbitrators (or in the event of a monetary dispute involving less than $25,000,
one arbitrator) to arbitrate the disputed matter. The arbitration decision shall
be binding and final and judgment on any award rendered by the
arbitrators may be entered in any court having jurisdiction thereof. Each side
shall bear the cost of its respective attorneys' fees associated with the
foregoing procedures.
Remedies: Equitable Relief. The Executive acknowledges and agrees that the
covenants and obligations of the Executive contained in Section 4 hereof relate
to special, unique and extraordinary matters and are reasonable and necessary to
protect the legitimate interests of the Company and its Affiliates and that a
breach of any of the terms of such covenants and obligations will cause the
Company irreparable injury for which adequate remedies at law are not available.
The Executive therefore consents to injunctive relief, a restraining order, an
order of specific performance or any other equitable relief (together,
"Equitable Relief") with respect to any of its obligations under Section 4. As
to such obligations, any order for Equitable Relief shall be in lieu of damages
except for damages accrued up to the date of compliance with the order. The
Executive hereby waives any claim or defense therein that the Company has an
adequate remedy at law or that money damages would provide an adequate remedy.
It shall, however, be the election of the Company as to whether or not to seek
Equitable Relief. An order for Equitable Relief shall be among the remedies
which can be granted pursuant to an arbitration instituted under Section 12
hereof and enforced by any court of competent jurisdiction. Additionally, solely
for the purpose of provisional relief pending a determination on the merits
pursuant to the arbitration process provided for in Section 12 hereof, the
Company may seek from an appropriate court Equitable Relief.
Amendments, Miscellaneous, etc. Neither this Agreement, nor any term
hereof, may be amended, modified, waived, discharged or terminated except by an
instrument in writing signed by the party against which such change, waiver,
discharge or termination is sought to be enforced. The Agreement may be executed
in one or more counterparts, each of which shall be deemed an original, and all
of which together shall constitute one and the same instrument. The headings
contained in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement. All references to
Sections shall be to Sections of this Agreement.
Effective Date and Termination of Previous Employment Agreements. By their
execution hereof, the parties agree that this Agreement shall be effective as of
January 1, 1996, and that the Employment Agreements between them dated as of
March 31, 1993 and November 1, 1995 are of no further force and effect and are
terminated in their entirety.
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement under seal as of the date first written above.
ASAHI/AMERICA, INC.
By: /s/ Xxxx Xxxxxx
Xxxx Xxxxxx
Title: Vice President and Treasurer
/s/ Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxx
DOCSB\504293.5
SCHEDULE A
TARGET NOI
$US
---
1996 $5,400,000
1997 $6,400,000
1998 $7,200,000
DOCSB\504293.5
