EXHIBIT 10.26
EMPLOYMENT AGREEMENT
THIS AGREEMENT dated this 1st day of July, 1999 by and between
TRIUMPH GROUP, INC., a Delaware corporation (the "Company"), and Xxxx X.
Xxxxxxxxxxx ("Executive").
WITNESSETH:
WHEREAS, Executive has served as Senior Vice-President and Chief
Financial Officer of the Company since its formation in 1993; and
WHEREAS, the Company wishes to assure itself of Executive's
continued employment by the Company during the period set forth herein; and
WHEREAS, Executive is willing to continue to serve the Company
during such period upon the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, the Company and Executive hereby agree as
follows:
1. TERMS OF EMPLOYMENT. The Company hereby agrees to employ
Executive, and Executive agrees to be employed by the Company, for a term
commencing on July 1, 1999 (the "Effective Date") and ending on September 30,
2002 (such term being
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hereinafter referred to as the "Period of Employment"), subject to earlier
termination as provided in Section 6 hereof.
2. DUTIES AND RESPONSIBILITIES. During the Period of Employment,
Executive shall serve as Senior Vice-President and Chief Financial Officer of
the Company and devote substantially all of his time and effort during normal
business hours (reasonable sick leave and vacations excepted) to the business
and affairs of the Company. The Executive shall report to the President and
Chief Executive Officer and the Board of Directors of the Company, and shall
have such duties, responsibilities and authority as are delegated to him by
the President and Chief Executive Officer and the Board of Directors. The
Executive's primary place of employment during the Period of Employment shall
be Wayne, Pennsylvania, unless changed with the Executive's consent.
3. SALARY. During the Period of Employment, the Company shall pay
the Executive, in periodic installments on the same basis as other senior
salaried executives of the Company, a base salary of $315,000 per annum (the
"Base Salary"), subject to such increases during the Period of Employment as
shall be approved by the Board of Directors of the Company (which increases,
when so approved, to thereafter constitute Executive's Base Salary for
purposes of this Agreement).
4. INCENTIVE COMPENSATION. In addition to the Base Salary provided
in Section 3 hereof, the Company shall pay to Executive, at such times as
such payments are made to other senior salaried executives of the Company and
its subsidiaries (hereinafter referred to as
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the "Group"), such incentive payments as shall be approved from time to time
by the Board of Directors of the Company or shall be due Executive pursuant
to the terms of incentive compensation plans approved by the Board of
Directors of the Company, subject to such deferral arrangements as are
provided in the Group's Supplemental Executive Retirement Plan effective
April 1, 1994 (the "Supplemental Retirement Plan") or otherwise approved by
the Board of Directors. The Executive's objectives under such plans shall be
set forth in writing annually by the Board of Directors or a duly authorized
committee thereof.
5. ADDITIONAL BENEFITS AND PERQUISITES.
(a) EMPLOYEE BENEFIT PLANS. During the Period of Employment,
Executive shall be entitled to participate on substantially the same basis as
other senior salaried executives of the Group in all employee benefit plans
maintained in effect by the Group from time to time during the Period of
Employment (all such plans hereinafter referred to as "Employee Benefit
Plans").
(b) PERQUISITES. During the Period of Employment, Executive
shall be entitled to such perquisites and fringe benefits as are generally
made available to the senior salaried executives of the Group.
(c) LIFE AND DISABILITY INSURANCE. During the Period of
Employment, Executive shall be entitled to participate in the group life and
disability insurance plan made available to the senior salaried executives of
the Group.
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(d) VACATION. During the Period of Employment the Executive
shall be entitled to five (5) weeks of vacation during each calendar year.
6. EARLY TERMINATION.
(a) DISABILITY. The Company shall have the right to terminate
Executive's employment during the Period of Employment upon not less than
thirty (30) days prior written notice to Executive or his personal
representative if, because of mental or physical disability, Executive shall
have been incapable, with reasonable accommodation, of satisfactorily
performing his duties under Section 2 hereof for a continuous period of one
hundred twenty (120) days or for a total period of two hundred ten (210) days
in any three hundred sixty (360) day-period prior to the date of such notice.
(b) DEATH. In the event of Executive's death during the
Period of Employment, this Agreement shall automatically terminate as of the
date of such death.
(c) FOR CAUSE. Notwithstanding any other provisions of this
Agreement, the Company may terminate Executive's employment at any time
during the Period of Employment for Cause, as herein defined, upon written
notice to the Executive. As used herein, "Cause" shall mean the doing of any
wilful act which is, in the judgment of the Board of Directors, materially
adverse to the best interests of the Company or which constitutes common law
fraud or a felony.
(d) WITHOUT CAUSE. The Company may terminate Executive's
employment at any time during the Period of Employment without Cause, as
defined in
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subparagraph (c) above, upon written notice to the Executive. The decision to
terminate Executive without Cause can be taken only at a duly called meeting
of the Board of Directors of the Company at which Executive is present and
afforded a full opportunity to be heard.
(e) GOOD REASON. Following a Control Transaction, as herein
defined, Executive may terminate this Agreement for Good Reason, as herein
defined. A "Control Transaction" shall be: (i) a reorganization, merger or
consolidation of the Company unless (A) the Company or a parent or subsidiary
of the Company is the surviving or resulting corporation or (B) the
shareholders of the Company immediately before such transaction own a
majority of the outstanding voting stock (after giving effect to the
conversion of all shares of Class D Common Stock of the Company) in the
surviving or resulting corporation or a parent thereof following the
transaction; (ii) the sale by the Company of all or substantially all of its
assets to a purchaser which is not a member of the Group immediately before
such sale; or (iii) any transaction or series of transactions which results
in the acquisition of a majority of the outstanding voting shares (after
giving effect to the conversion of all of the outstanding Class D Common
Stock of the Company) of the Company by a purchaser or purchasers (A) who are
not currently shareholders of the Company and who acquired such voting shares
in a transaction or transactions not involving an offering registered under
the Securities Act of 1933, as amended; (B) which was not a subsidiary of the
Company immediately before such acquisition; or (C) a majority of whose
outstanding voting shares, immediately following the acquisition, are owned
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by persons who were not shareholders of the Company immediately before the
acquisition. "Good Reason," as use herein, shall mean (i) a determination by
Executive in good faith that due to acts of the Company occurring after the
Control Transaction he is unable effectively to carry out his duties and
responsibilities as of the time of the Control Transaction; (ii) a material
reduction in the duties and responsibilities assigned to Executive pursuant
to Section 2 hereof following the Control Transaction; (iii) the transfer
following the Control Transaction of Executive's principal place of business
to a location more than fifty (50) miles from the location as of the time of
the Control Transaction; or (iv) the failure or refusal of the Successor, as
defined in Section 9 hereof, to assume all duties and obligations of the
Company under this Agreement, as contemplated by Section 9.
7. EFFECTS OF EARLY TERMINATION.
(a) In the event of the Company's termination of Executive's
employment during the Period of Employment as a result of his disability,
Executive shall be entitled to receive his Base Salary for the month in which
such termination becomes effective and for a period of six (6) months
thereafter, without prejudice to any other payments or disability benefits
due Executive under any Employee Benefit Plan as a result of Executive's
disability.
(b) In the event of Executive's death, Executive's legal
representative shall be entitled to receive Executive's Base Salary through
the end of the sixth month following
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the month in which Executive's death occurred, without prejudice to any other
payments or benefits due under any Employee Benefit Plan as a result of
Executive's death.
(c) In the event of the Company's termination of Executive's
employment during the Period of Employment for Cause, as defined in Section
6(c), the Company shall have no obligation to pay Executive any compensation
or benefits other than (i) his then current Base Salary to the date of
termination and (ii) payments or benefits due under any Employee Benefits
Plans upon or following such termination.
(d) In the event the Company terminates Executive's employment
during the Period of Employment without Cause or Executive terminates his
employment during such period for Good Reason, as defined in Section 6(d),
the Company shall pay Executive the following amounts:
(i) Executive's Base Salary for the balance of the month
in which such termination occurs, plus credit for any vacation earned
but not taken prior to the date of termination;
(ii) as severance payments, commencing on the last day of
the month in which the termination occurs and on the last day of each
month thereafter, an amount equal to one-twelfth of the Executive's then
current Base Salary for a period of twenty-four (24) months.
(iii) any payments due under any Employee Benefits Plans
upon or following such termination.
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(e) Under no circumstances shall Executive, upon termination
of his employment hereunder, be entitled to receive any incentive
compensation payments with respect to the fiscal year in which an early
termination occurs. Nothing herein, however, shall affect Executive's right
to receive any previously earned but unpaid deferred compensation payments to
which Executive may be entitled under the Supplemental Executive Retirement
Plan.
(f) Except as provided in Section 7(e), during the period
Executive continues to receive payment of his Base Salary following the
termination of the Executive's employment, Executive, his dependents,
beneficiaries and estate shall continue to be entitled to all benefits under
all Employee Benefit Plans as if Executive were still employed during such
period under this Agreement. Executive, to the extent that he has at the time
of termination sufficient service credits or has otherwise satisfied
applicable eligibility requirements under the terms of the Employee Benefit
Plans shall be deemed to have retired from the Company as of such time, and
shall be eligible for any and all benefits and rights provided to retirees at
a comparable executive level from the Company or the Group under all Employee
Benefits Plans.
(g) The severance compensation and benefits provided in this
Section 7 shall constitute Executive's sole and exclusive right to severance
payments and benefits upon termination of Executive's employment and no other
severance compensation of any kind, nature and amount shall be payable to
Executive in connection with any termination during the Period of Employment.
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(h) Executive's right to receive any of the severance
compensation and benefits provided herein shall be subject to his faithful
observance and performance during the Period of Employment and thereafter of
the agreements set forth in his Executive Stock Agreement dated July 22, 1993
with the Company.
8. TERMINATION NOTICE. Any termination by the Company or by
Executive hereunder shall be communicated by written Notice of Termination to
the other party hereto. For purposes of this Agreement, a "Notice of
Termination" shall mean a written notice which shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in
reasonable detail all facts and circumstances claimed to provide a basis for
termination of the Executive's employment under the provision so indicated.
Any such notice shall be by registered or certified mail and mailed to
Executive at the last address he has filed in writing with the Company, or,
in the case of the Company, to the Secretary at Four Glenhardie Corporate
Center, 0000 Xxxxxxxx Xxxx, Xxxxx 000, Xxxxx, XX 00000-0000 or such other
address to which the Company's principal executive offices are removed during
the Period of Employment.
9. SUCCESSORS/BINDING AGREEMENT. The Company shall require any
successor or surviving entity in any Control Transaction ("Successor"), by
agreement in form and substance satisfactory to Executive, expressly to
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform if no such succession
had taken place. Regardless of whether such agreement is executed, this
Agreement shall be binding upon any Successor in accordance with the
operation of law and
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such Successor shall be deemed the "Company" for purposes of this Agreement.
This Agreement shall inure to the benefit of and be enforceable by Executive
and his personal or legal representative, executors, administrators,
successors, heirs, distributees, devisees and legatees.
10. SEVERABILITY. In the event any provision or portion of this
Agreement shall be determined to be invalid or unenforceable for any reason,
the remaining provisions of this Agreement shall remain in full force and
effect to the fullest extent permitted by law.
11. AMENDMENT/WAIVER. This Agreement may not be amended, modified,
waived or cancelled except by a writing signed by each party hereto. No
waiver by either party hereto at any time of any breach by the other party
hereto of, or compliance with, any condition or provision of this Agreement
to be performed by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or any prior or subsequent
time.
12. ENTIRE AGREEMENT. This Agreement constitutes the entire
Agreement between the parties relative to the employment of the Executive by
the Company during the Period of Employment. Any previous agreement among the
parties not mentioned in this Agreement is superseded by this Agreement.
13. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of Pennsylvania.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first above written.
TRIUMPH GROUP, INC.
By: /s/ Xxxxxxx X. III
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Title: PRESIDENT
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Executive: /s/ Xxxx X. Xxxxxxxxxxx
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