EXHIBIT 10.12
EXECUTION VERSION
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT (this "Agreement") is made and entered
into as of January 28, 2004 by and among Thermadyne Holdings Corporation, a
Delaware corporation ("Holdings"), the subsidiaries of Holdings listed as
signatories hereto (together with Holdings, the "Employers"), and Xxxx X. Xxxxxx
("Employee").
RECITALS
Employers wish to employ Employee and Employee wishes to be employed by
Employers on the terms and conditions set forth in this Agreement.
NOW THEREFORE, for and in consideration of the foregoing recital, and in
consideration of the mutual covenants, agreements, understandings, undertakings,
representations, warranties and promises hereinafter set forth, and intending to
be legally bound thereby, Employers and Employee do hereby covenant and agree as
follows:
SECTION 1. BASIC EMPLOYMENT PROVISIONS
(a) EMPLOYMENT AND TERM. Employers hereby employ Employee (hereinafter
referred to as the "EMPLOYMENT") as President and Chief Executive Officer of
Holdings 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 January 28, 2004 (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
nonrenewal 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 ("NON-RENEWAL NOTICE").
A Non-Renewal Notice shall be deemed given on the date it is received by
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 (as defined below), such amount to
continue to be paid in accordance with the payroll practices of Employers for a
period equal to six (6) months from the expiration of the Employment Period
Notwithstanding any other provision of this Agreement, if Employers intend not
to renew this Agreement for any reason, but had not previously notified Employee
of any inadequate performance of his duties or responsibilities as assigned to
him by the Board, then Employers must provide Employee with written notice that
Employers intend not to renew this Agreement and such notice shall be provided
not less than 180 days in advance of the applicable anniversary of the Effective
Date; PROVIDED, HOWEVER, that the failure to provide such notice shall not
affect or otherwise prohibit Employers from terminating or not renewing this
Agreement as permitted hereunder.
(b) DUTIES. Employee, as President and Chief Executive Officer of
Holdings, shall be subject to the direction and supervision of the Board of
Directors of Holdings (the "BOARD") and, as the President and Chief Executive
Officer of Holdings, shall have those duties and responsibilities which are
assigned to him during the Employment Period by the Board 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 reasonably necessary to discharge his supervisory
management responsibilities hereunder 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 ("BASIC COMPENSATION"). The initial Basic Compensation shall be
$550,000 per annum. Such Basic Compensation shall be reviewed no less frequently
than annually by the Board and may be adjusted by the Board in its sole
discretion. Such salary shall accrue and be payable in accordance with the
payroll practices of Employers' subsidiary or subsidiaries in effect from time
to time.
(b) BONUS. During the Employment Period, Employee shall additionally
participate in an annual bonus plan, in accordance with the terms set forth in
Employers' Management Incentive Plan, providing for an annual bonus opportunity
of one hundred-percent (100%) of Employee's Basic Compensation for each fiscal
year ending during the Employment Period as follows: (i) if the Board determines
in good faith that Holdings meets or exceeds the Return on Invested Capital
Targets (as defined below) in accordance with its annual budget for such fiscal
year, Employee shall be eligible to receive a bonus equal to fifty-percent (50%)
of his Basic Compensation for such year, and (ii) if the Board determines in
good faith that Employee meets certain goals and performance objectives mutually
agreed upon by the Board and Employee ("PERFORMANCE OBJECTIVES"), Employee shall
be eligible to receive a bonus equal to fifty-percent (50%) of his Basic
Compensation for such fiscal year. For purposes of this Agreement, the "RETURN
ON INVESTED CAPITAL TARGETS" shall be determined by the Board based upon
Holdings' annual budget for such fiscal year as approved by the Board. The Board
and Employee shall mutually agree upon Performance Objectives in writing each
year no later than thirty (30) days prior to the beginning of each fiscal year.
(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, excess savings plans,
tax qualified profit sharing plans and any other retirement plans, health, group
life (with optional additional coverage), short term disability, long term
disability (not to exceed sixty-percent (60%) of Employee's Basic Compensation
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. 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 ("OPTIONS")
to purchase up to 175,000 shares of the Common Stock of Holdings (the "COMMON
STOCK") in accordance with the terms and conditions of Holdings' stock option
plan. The exercise price for the Options shall be equal to the closing bid price
per share of the Common Stock on the over-the-counter market as of the close of
business immediately preceding the date of grant. 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
first three anniversaries of the date of grant, and the remaining one-half of
the Options (the "PERFORMANCE
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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. in the event 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 expire on such date.
(e) WITHHOLDING TAXES. The compensation and benefits to be provided to
Employee pursuant to this Agreement shall all be subject to withholding and
deductions for applicable federal, state and local taxes and other items, if
any, authorized or required to be withheld.
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, "TOTAL DISABILITY" shall be deemed to have occurred
if Employee shall have been unable to perform the duties of his Employment due
to mental or physical incapacity for a period of (i) 90 consecutive days or (ii)
120 non-consecutive days within any 365 day period.
(b) CAUSE. The Board may terminate the Employment of Employee under this
Agreement for Cause. For the purposes of this Agreement, "CAUSE" shall be deemed
to be (i) the conviction of a crime by Employee constituting a felony or other
crime involving moral turpitude, (ii) an act of dishonesty or disloyalty by
Employee that resulted in or was intended to result in gain to or personal
enrichment of Employee at any of the Employers' expense; (iii) the willful
engaging by Employee in misconduct which is injurious to any of the Employers;
(iv) Employee's failure to comply with the material terms of this Agreement; (v)
failure by Employee to comply fully with any lawful directives of the Board or
Employers; (vi) misappropriation by Employee of Employers' funds; (vii) habitual
abuse of alcohol, narcotics or other controlled substances by Employee; (viii)
gross negligence in the performance of Employee's duties and responsibilities
hereunder; (ix) failure to perform or adhere to the Code of Ethics adopted by
the Board, as the same may be amended by the Board from time to time, a copy of
which has been delivered to Employee as adopted by the Board as of the date
hereof; or (x) Employee relocates his primary place of residence more than
seventy-five (75) miles from the present location of Holdings' corporate
headquarters in St. Louis, Missouri (except if such relocation is expressly
requested by Holdings).
(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 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
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and which is remedied by the Employers within 30 days after receipt of
written notice thereof given by the Employee;
(ii) any purported termination by the Employers of the Employee's
employment otherwise than as expressly permitted by SECTION 3(b) of this
Agreement;
(iii) 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; or
(iv) if the Employers require Employee to relocate his principal work
site to a principal work site that is more than seventy-five (75) miles
from Employee's primary place of residence as of the date of this
Agreement.
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 unreimbursed
expenses pursuant to SECTION 5 below, and, thereafter, Employers shall have no
further obligations or liabilities hereunder to 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 unreimbursed expenses pursuant to SECTION 5 below. Thereafter, Employers
shall have no obligation for Basic Compensation or other compensation payments
to Employee during thc continuance of such total disability.
(c) TERMINATION FOR CAUSE OR VOLUNTARY TERMINATION. Tithe Employment
Period (i) is not renewed in accordance with the terms and conditions of SECTION
1(a) above or (ii) is terminated for Cause or voluntarily by the Employee for
reasons other than those described in SECTION 3(a) OR 3(d) above, no
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further compensation or benefits shall bc 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, 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 (A) a
bonus equal to the average of the bonuses earned pursuant to the terms of
SECTION 2(b) in the two years immediately preceding the year in which Employee
is terminated, or (B) if this Agreement is terminated pursuant to SECTION 3(c)
OR 3(d) during the second year of this Agreement, a bonus equal to the bonus
earned pursuant to SECTION 2(b) in the year immediately preceding the year in
which Employee is terminated; PROVIDED, HOWEVER, in either case, that if no
bonus was earned in the applicable year(s) immediately preceding the year in
which Employee is terminated, then the bonus for such applicable year shall be
deemed zero for purposes of computing the bonus under this SECTION 4(d) and,
PROVIDED, FURTHER, that if this Agreement is terminated pursuant to SECTION 3(c)
OR 3(d) during the first year of this Agreement, then Employee shall not receive
a bonus under this SECTION 4(d), (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, and (iv) during such 12-month
period, to a monthly automobile allowance as contemplated by SECTION 5 below;
PROVIDED, HOWEVER, that Employee shall no longer be entitled to participate in
any of Employers' 401K plans, excess savings plans, tax qualified profit sharing
plans or any other retirement plans. If Employee is entitled to receive a bonus
pursuant to SECTION 4(d)(ii) above, such bonus, if any, shall be payable in
twelve (12) equal monthly installments, to be paid on or before the fifth (5th)
day of each month, with the first monthly installment payment beginning in the
mouth immediately following the month in which Employee was terminated and
continuing thereafter for the next eleven (11) consecutive months. Employee
shall have the option to receive the present value of the compensation, bonus
and 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 ten (10) days of termination and 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, bonus, benefits and monthly automobile allowance shall cease
upon Employee's death. In the event Employee obtains employment elsewhere during
such 12-month period such compensation, bonus, benefits and monthly automobile
allowance shall continue for the period described above notwithstanding such
reemployment of Employee; PROVIDED, HOWEVER, that Employers' obligations for
compensation, bonus, benefits and monthly automobile allowance shall be reduced
by the amount Employee receives from his new employer for compensation. bonus,
benefits and automobile allowance. 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 any claims arising out of 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 claims in form and substance satisfactory to Employers,
(e) CHANGE OF CONTROL.
(i) Anything in this Agreement to the contrary notwithstanding, if a
Change of Control (as defined below) occurs and if Employee's Employment
with the Employers is (A) terminated for any reason within one (1) year
after the date on which the Change of Control occurs, (B) terminated by
Employer as a Constructive Termination Without Cause, or (C) terminated as
a result of the non-renewal of this Agreement by the Employers on the next
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applicable anniversary date for renewal of the Agreement (each a "Change of
Control Termination"), Employee shall be entitled (i) to continue to
receive from Employers his then current Basic Compensation, such amount to
continue to be paid in accordance with the payroll practices of Employers
for a period equal to 24 months, (ii) to receive (A) a bonus equal to the
average of the bonuses earned pursuant to the terms of SECTION 2(b) in the
two years immediately preceding the year in which the Change of Control
Termination occurs, or (13) if the Change of Control Termination occurs
during the second year of this Agreement, a bonus equal to the bonus earned
pursuant to SECTION 2(b) in the immediately preceding year; PROVIDED,
HOWEVER, in either case, that if no bonus was earned in the applicable
year(s) immediately preceding the year in which the Change of Control
Termination occurs, then the bonus for such applicable year shall be deemed
zero for purposes of computing the bonus under this SECTION 4(e) and,
PROVIDED, FURTHER, that if the Change of Control Termination occurs during
the first year of this Agreement, then Employee shall not receive a bonus
under this SECTION 4(e), (iii) during such 24-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, and (iv)
during such 24-month period, to a monthly automobile allowance as
contemplated by SECTION 5 below; PROVIDED, HOWEVER, that Employee shall no
longer be entitled to participate in any of Employers' 401K plans, excess
savings plans, tax qualified profit sharing plans or any other retirement
plans. If Employee is entitled to receive a bonus pursuant to SECTION
4(e)(ii) above, the amount of such bonus, if any, shall be doubled and
shall be payable in twenty-four (24) equal monthly installments, to be paid
on or before the fifth (5th) day of each month, with the first monthly
installment payment beginning in the month immediately following the month
in which Employee was terminated and continuing thereafter for the next
twenty-thee (23) consecutive months. Employee shall have the option to
receive the present value of the compensation, bonus and 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 ten
(10) days of termination and 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 24-month period, such
continuation of compensation, bonus, benefits and monthly automobile
allowance shall cease upon Employee's death. In the event Employee obtains
employment elsewhere during such 24-month period such compensation, bonus,
benefits and monthly automobile allowance shall continue for the period
described above notwithstanding such reemployment of Employee; PROVIDED,
HOWEVER, that Employers' obligations for compensation, bonus, benefits and
monthly automobile allowance shall be reduced by the amount Employee
receives from his new employer for compensation, bonus, benefits and
automobile allowance. The sums received by Employee under this SECTION 4(e)
shall be considered liquidated damages in respect of claims based on any
provisions of this Agreement or any claims arising out of 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 claims in form and substance satisfactory to Employers. The
compensation, bonus and benefits received by Employee pursuant to this
SECTION 4(e) shall be in lieu of any compensation, bonus and benefits due
under SECTION 4(c) or SECTION 4(d).
(ii) For purposes of this Agreement, "CHANGE OF CONTROL" shall mean
(A) any sale of all or substantially all of the assets of Holdings or of a
majority of the other Employers, (B) any merger, consolidation or
reorganization involving Holdings, unless the stockholders of Holdings,
immediately before such merger, consolidation or reorganization, own,
directly or indirectly, immediately following such merger, consolidation or
reorganization, at least fifty percent (50%) of the combined voting power
of the outstanding voting securities of the corporation resulting
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from such merger, consolidation or reorganization, in substantially the
same proportion as their ownership of the voting securities of Holdings
immediately before such merger, consolidation or reorganization, or (C) any
other transaction (or series of related transactions) resulting in the
stockholders of Holdings, immediately before such transaction (or the first
of such series of related transactions), owning, directly or indirectly,
immediately following such transaction, less than two-thirds (2/3) of the
combined voting power of the outstanding voting securities of Holdings.
(f) PAYMENTS. In no event shall any payment to Employee under this
Agreement that constitutes a "parachute payment" within the meaning of Section
280G(b)(2) of the Internal Revenue Code of! 9S6, as amended (the "Code"), exceed
299% of Employee's "base amount" of compensation, as defined in Section 280G of
the Code. If any such "parachute payment" would exceed 299% of such "base
amount," Employers will instead pay Employee 299% of the "base amount" and
Employers shall have no further obligation to Employee hereunder.
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, including the ownership and use of a cellular phone. Employers
shall provide Employee with a monthly car allowance of $500; PROVIDED, HOWEVER,
that there shall be no cap on such monthly car allowance for so long as Holdings
continues to lease the BMW automobile that it leases as of the date hereof and
provides to Employee for use, and Holdings shall have no obligation to renew
such lease or to otherwise exercise any options to prolong Holdings' use of such
automobile beyond the current lease term. 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, in which
case such expenses shall be reimbursed on a prorated basis through the
termination date of the Employment Period.
SECTION 6. ASSIGNABILITY; BINDING NATURE.
This Agreement shall be binding upon 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. Each Employer
may, without the prior written consent of Employee, assign its rights and
obligations under this Agreement, in whole or in part, including, without
limitation, the rights and obligations set forth in SECTION 7 through SECTION 9,
to any one or more of its affiliates or any entity that acquires a substantial
part of its assets or a successor by merger, consolidation or other corporate
restructuring. As used in this Agreement, the "Employers" arid "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.
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(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 Board.
(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 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 tinder 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 or voluntarily terminates his Employment with Employers other than as a
Constructive Termination, Employee hereby agrees that for a period of 18 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(h) 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 (i) by Employers
without Cause, (ii) due to the non-renewal of the Employment Period by
Employers, (iii) as a result of the total disability of Employee, (iv) by
Employee as a Constructive Termination Without Cause or (v) as a result of a
Change of Control Termination, Employee hereby agrees that during the period
that the Employers are required to make payment to Employee (regardless of
whether Employee accepts such payment, elects to receive a lump sum of such
payment, refuses to execute and deliver a general release as required hereunder
or if such
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obligation is reduced in any way due to Employee's employment elsewhere)
pursuant to SECTION 4(b), SECTION 4(c), SECTION 4(d) or SECTION 4(e), above, as
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 any1 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 two (2) years following the
termination or expiration of this Agreement, 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 employment or agency, as the case may
be, with any Employers or such subsidiary; provided that such limitations shall
not apply if the contact with the employee, agent or consultant is initiated by
a third party, not engaged or hired by Employee or any affiliate of Employee, on
a "blind basis" such as through a head hunter.
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 (without the
requirement to post bond) 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) In the event of Employee's violation of the provisions of SECTION 7
after the Employment of Employee is terminated for any reason, SECTION 8 or
SECTION 9, 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.
SECTION 12. CAPTIONS.
9
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, 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, XX 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.
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.
10
SECTION 17. COUNTERPARTS; REPRODUCTION.
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, and any copy, facsimile or other reliable reproduction of
this Agreement maybe substituted or used in lieu of the original writing for any
and all purposes for which the original writing could be used, provided that
such copy, facsimile or other reproduction be a complete reproduction of the
entire original writing.
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 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. 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.
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. 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. 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 22. PRIOR AGREEMENTS.
This Agreement supersedes any and all other employment or similar
agreements between Employee and Employers, including, without limitation, that
certain letter agreement, dated October 16, 2003, from Holdings to Employee (the
"LETTER"); PROVIDED, HOWEVER, that the options granted to Employee to purchase
25,000 shares of Common Stock as set forth in the Letter shall survive this
Agreement in accordance with the terms of the Letter.
SECTION 23. EMPLOYEE ACKNOWLEDGEMENTS.
Employee acknowledges and agrees that (a) he has read this Agreement; (b)
he is fully competent to execute this Agreement which he understands to be
contractual; (c) he executes this Agreement of his own free will, after having a
reasonable period of time to review, study, and deliberate regarding its
11
meaning and effect and to consult with counsel regarding same; and (d) without
reliance on any representation of any kind or character not expressly set forth
herein.
* * * * * * * * * *
12
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Employment Agreement as of the date first above written.
EMPLOYEE:
/s/ Xxxx X. Xxxxxx
-------------------------------------
Name: Xxxx X. Xxxxxx
EMPLOYERS:
THERMADYNE HOLDINGS CORPORATION
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE INDUSTRIES, INC.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
XXXXXX EQUIPMENT COMPANY
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE INTERNATIONAL CORP.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
TWECO PRODUCTS, INC.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
13
THERMAL DYNAMICS CORP.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
STOODY COMPANY
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMAL ARC, INC.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
C&G SYSTEMS HOLDINGS, INC.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
C&G SYSTEMS, INC.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE ITALIA, SRL.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE AUSTRALIA PTY LTD.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
14
THERMADYNE ASIA/PACIFIC PTE LTD.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE JAPAN, LTD.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE SOUTH AMERICA HOLDINGS, LTD.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE SOUTH AFRICA (PTY) LTD.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
MAXWELD & BRAZE (PTY) LTD.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
GENSET S.P.A.
By:
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
TECMO SRL
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
15
OCIM SRL
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
DUXTECH PTY. LTD.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
CIGWELD GROUP PTY LTD.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE BRAZIL HOLDINGS, LTD.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE XXXXXX LTDA.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE CHILE HOLDINGS, LTD.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
SOLTEC SA
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
16
THERMADYNE DO BRASIL LTDA.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE INDUSTRIES, LTD.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE CYLINDER CO.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
MECO HOLDING COMPANY
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
PROTIP CORPORATION
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE WELDING PRODUCTS CANADA, LTD.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE DE MEXICO S.A. DE C.V.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
17
TWECO DE MEXICO S.A. DE C.V.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
XXXXXX EQUIPMENT DE MEXICO S.A. DE C.V.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
PHILIPPINE WELDING EQUIPMENT, INC.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
CIGWELD PHILIPPINES, INC.
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
THERMADYNE ASIA SDN BHD
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
PT CIGWELD INDONESIA
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
CIGWELD MALAYSIA SDN
By: /s/ Xxxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxxx X. Xxxxxxxx
Title: Vice President & General Counsel
18
