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Exhibit 10
EMPLOYMENT AGREEMENT
AGREEMENT made this 28th day of July, 1995 between Sudbury, Inc., a
Delaware corporation with its principal office at 00000 Xxxxxxx Xxxx., Xxxxx
000, Xxxxxx Xxxx, Xxxx 00000 (the "Company"), and Xxxxxxx X. Xxxxxx, whose
residential address is 0000 Xxxxxxx Xxxx Xxxx, Xxxxx, Xxxx 00000 ("Sardas").
RECITALS
--------
The Company is a holding company with subsidiaries engaged in the
manufacture and sale of a broad range of industrial products.
The Company and Sardas are currently parties to an amended employment
agreement made January 13, 1992, as amended as of April 16, 1992 (the "Current
Employment Agreement").
The Company and Sardas desire to enter into a new employment agreement
to commence upon the expiration of the Current Employment Agreement.
Now, therefore, the parties agree as follows:
1. Employment
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The Company agrees to employ Sardas, and Sardas agrees to be so
employed, in the capacity of Chairman and Chief Executive Officer, with such
duties and authority as are customary for such offices. The Company, by action
of the Company's Board of Directors (the "Board"), may, at any time during the
term of this Agreement, elect or designate a person other than Sardas as Chief
Executive Officer, upon which election or designation, Sardas's employment
pursuant hereto shall not include employment as Chief Executive Officer but
shall include employment as Chairman. From and after the time that Sardas is no
longer Chief Executive Officer of the Company, Sardas's duties and authority as
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Chairman shall be in accordance with and subject to the direction and approval
of the Board; provided, however, that Sardas' duties will not be inconsistent
with duties customary for a Chairman.
2. Term
----
Subject to the provisions for termination as hereinafter provided and
except as specifically provided to the contrary herein, the term of this
Agreement shall begin on January 13, 1996 and shall continue for a term of two
(2) years from such date to and including January 12, 1998 unless terminated by
the Company for "Cause" (as defined below), or by Sardas's death or "permanent
disability" (as defined below); provided however, this Agreement shall be null
and void and of no effect if the Current Employment Agreement is validly
terminated prior to January 12, 1996. It is hereby acknowledged that the Current
Employment Agreement will not have been validly terminated for purposes of this
Section 2 if terminated by the Company without Cause (as defined for purposes of
this Section 2 in the Current Employment Agreement). However, it will have been
validly terminated for purposes of this Section 2 if terminated by the Company
for Cause (as defined therein for purposes of this Section 2), if terminated by
Sardas or if terminated as a result of the death or permanent disability (as
defined therein) of Sardas. Therefore, the parties acknowledge and agree that
unless prior to the expiration of the Current Employment Agreement Sardas is
terminated for Cause thereunder, dies, is permanently disabled or Sardas
terminates this Agreement, the provisions of this Agreement will remain in full
force and effect.
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3. Time and Efforts
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Sardas shall diligently and conscientiously devote his full business
time and attention and best efforts in discharging his duties hereunder, as
specified by the Board, which duties shall be consistent with his position as
set forth in paragraph 1 above; provided, however, that from and after such time
as Sardas is no longer Chief Executive Officer of the Company, Sardas shall be
required to devote not more than fifty percent (50%) of his business time and
attention and best efforts in discharging his duties hereunder. During the
balance of such time, Sardas may engage in other business activities. It is
understood that Sardas may serve as a director of one or more other business
entities upon consent by the Board; provided, however, that such consent shall
no longer be required hereunder from and after such time as Sardas is no longer
Chief Executive Officer of the Company. Notwithstanding anything to the contrary
contained herein, during the term of this Agreement, Sardas shall not be
employed by, invest in or otherwise be affiliated with any entity which is in
competition with the Company if such activity would constitute a violation of
Sardas' fiduciary duty to the Company.
4. Compensation
------------
(a) CASH COMPENSATION. For all services he may render to the
Company, the Company shall pay to Sardas a base salary at a rate of
$500,000 per year, subject to withholding tax, payable at the same
times as payments to other salaried corporate employees. Upon the later
of (i) the date the Board elects or designates someone other than
Sardas as Chief Executive Officer (but Sardas shall remain as Chairman
hereunder) and (ii) January 13, 1997, the base salary rate to be paid
by the Company to Sardas for all services he may render to the Company
shall change to $250,000 per
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year. Such salary may be increased from time to time at the discretion
of the Board, in conjunction with salary adjustments of other in the
Company's corporate management group.
(b) BONUSES. The Company shall pay to Sardas in a lump sum
payment within ninety (90) calendar days following the end of each
fiscal year of employment an annual target bonus of up to sixty percent
(60%) of his aggregate paid base salary for each such previous fiscal
year during the term of his employment. Each such payment shall be
conditioned on Sardas being employed by the Company at the time of such
fiscal year-end, provided that in the event that Sardas's employment by
the Company is terminated by reason of his death or permanent
disability or by the Company other than for Cause, such bonus payment
shall be made to Sardas or his estate, as the case may be, on a pro
rata basis, determined by reference to the number of days from the
beginning of the then current fiscal year to the date of such
termination as compared to the total number of days in such fiscal
year. Achievement of the full amount of such bonus will depend on
Sardas's performance with respect to corporate bonus plan as set by the
Board after consultation with Sardas no later than August 31 of each
fiscal year.
5. Benefits
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Sardas shall be entitled to benefits and perquisites generally provided
by the Company to its executive officers and such benefits and perquisites as
are recommended by the Compensation Committee and approved by the Board.
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6. Payment Upon Termination
------------------------
(a) In the event of a termination of this Agreement by Sardas
or termination by the Company for "Cause" prior to January 12, 1998,
Sardas shall receive no severance pay or additional compensation other
than the fixed compensation and benefits earned and accrued as of such
termination date pursuant to Paragraphs 4 and 5 herein. For the
purposes of this Agreement, the Company shall have "Cause" to terminate
employment hereunder only (i) if termination shall have been the result
of an act or acts of dishonesty by Sardas constituting a felony and
resulting or intended to result directly or indirectly in substantial
gain or personal enrichment at the expense of the Company; or (ii) upon
the willful and continued failure by Sardas substantially to perform
his duties with the Company (other than any such failure resulting from
incapacity due to mental or physical illness) after a demand in writing
for substantial performance is delivered by the Board, which demand
specifically identifies the manner in which the Board believes that
Sardas has not substantially performed his duties, and such failure
results in demonstrably material injury to the Company. Sardas's
employment shall in no event be considered to have been terminated by
the Company for Cause if such termination took place as the result of
(i) bad judgment or negligence, or (ii) any act or omission without
intent of gaining therefrom directly or indirectly a profit to which
Sardas was not legally entitled, or (iii) any act or omission believed
in good faith to have been in or not opposed to the interest of the
Company, or (iv) any act or omission in respect of which a
determination is made that Sardas met the applicable standard of
conduct prescribed for indemnification or reimbursement or payment of
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expenses under the by-laws of the Company or the laws of the State of
Delaware, in each case as in effect at the time of such act or
omission. Sardas shall not be deemed to have been terminated for Cause
unless and until there shall have been delivered to him a copy of a
resolution duly adopted by the affirmative vote of not less than
three-quarters of the entire membership of the Board at a meeting of
the Board called and held for the purpose (after reasonable notice to
Sardas and an opportunity for him, together with his counsel, to be
heard before the Board), finding that in the good faith opinion of the
Board, Sardas was guilty of conduct set forth above in clauses (i) or
(ii) of the second sentence of this paragraph and specifying the
particulars thereof in detail.
(b) In the event of a termination by the Company without Cause
at any time after the date of execution hereof (even if prior to
January 13, 1996) and prior to January 12, 1998, the Company shall pay
to Sardas his base salary at the rates provided for in this Agreement
(or such higher rate as may have been provided for by the Board during
the term of this Agreement pursuant to Section 4(a) hereof) for the
remainder of the term of this Agreement and any bonus due under Section
4(b) hereof.
(c) In the event of death or permanent disability during the
term of this Agreement, this Agreement shall terminate and Sardas (or
his estate or personal or legal representative) shall receive no
severance pay or additional compensation other than the fixed
compensation and benefits earned and accrued as of the date of such
death or termination for
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permanent disability, including any bonus due under Paragraph 4(b)
hereunder. For purposes of this Agreement, termination for permanent
disability shall occur on such date and in such circumstance that, as a
result of his incapacity due to physical or mental illness, Sardas were
to have been absent from his duty with the Company on a full-time basis
for a period of six (6) consecutive months, provided that the Company
had given Sardas thirty (30) days written notice of potential
termination, and within said thirty (30) day period after written
notice of termination had been given, Sardas had not returned to the
full-time performance of his duties.
7. Existing Options
----------------
(a) Pursuant to that certain Non-Statutory Stock Option
Agreement dated September 1, 1992 between the Company and Sardas,
Sardas was granted the option to purchase 1,764,706 shares (the "1992
Option Shares") of the Company's common stock, subject to the terms and
conditions set forth therein.
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(b) (i) Until January 13, 1998 (even if prior thereto Sardas
shall have terminated this Agreement), Sardas, or his estate, as the
case may be, shall have the right to sell to the Company, and the
Company shall be required to purchase from Sardas for cash, the
following amounts of 1992 Option Shares on each of the indicated dates
(individually, an "Option Purchase Date" and collectively, the "Option
Purchase Dates"):
Option Purchase Date Number of 1992 Option Shares
-------------------- ----------------------------
February 7, 1996 352,942
July 13, 1996 352,941
January 13, 1997 352,941
July 13, 1997 352,941
January 13, 1998 352,941
(b) (ii) In order to exercise such right, Sardas must deliver
to the Company no later than five (5) business days prior to the
relevant Option Purchase Date a notice stating that he is exercising
his right pursuant to this Section 7(b) of this Agreement and setting
forth the number of 1992 Option Shares as to which such right was being
exercised (e.g. no Option Shares or one or two full installments as
applicable pursuant to the provisions of this Agreement). The purchase
price for each of the 1992 Option Shares so purchased shall be the Fair
Market Value for the Company's common stock on the Option Purchase
Date. For purposes of this Section 7, the "Fair Market Value" for the
Company's common stock on the Option Purchase Date shall mean the
average closing price (or, as to any such day on which
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no sales of the Company's common stock shall have taken place, then as
to such day, the average of the last reported closing bid and asked
prices) of the Company's common stock on the principal stock exchange
on which the Company's common stock is then traded (or if the Company's
common stock is not then listed on any such exchange, then on the
over-the-counter market) during the period comprising the ten
consecutive trading days immediately preceding the fifth business day
immediately preceding the relevant Option Purchase Date, as such prices
are reported in The Wall Street Journal, or if not so published in such
newspaper, in any other newspaper of general circulation selected by
the Company and reasonably acceptable to Sardas.
(b) (iii) Unless Sardas previously shall have been terminated for Cause
or has terminated this Agreement prior to the expiration of its term,
Sardas may, at his option, delay the exercise of his right pursuant to
Section 7(b)(i) as to the indicated number of 1992 Option Shares until
the next succeeding Option Purchase Date. If at that next succeeding
Option Purchase Date, Sardas does not exercise his right as to the
delayed 1992 Option Shares, then his rights pursuant to this Section 7
as to those delayed 1992 Option Shares shall cease.
(c) If this Agreement is terminated due to the death or
permanent disability of Sardas, then Sardas (or the estate or personal
or legal representative of Sardas, as the case may be) shall have the
right, exercisable by written notice delivered to the Company within
thirty (30) days following such death or disability to sell to the
Company, and the Company shall be required to purchase for cash, all of
the 1992 Option Shares at a purchase price equal to the Fair Market
Value for
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the Company's common stock on the date of such death or permanent
disability, calculated as if such date was an Option Purchase Date.
Such purchase shall occur within forty-five (45) days following receipt
by the Company of the written notice referred to in the immediately
preceding sentence.
(d) If this Agreement is terminated by the Company other than
for Cause at any time after the date of execution hereof (even if prior
to January 13, 1996) and prior to January 12, 1998, then, in such
event, Sardas shall have the right, exercisable by written notice to
the Company delivered within fifteen (15) days following such
termination, to sell to the Company, and the Company shall be required
to purchase from Sardas for cash, all, but not less than all, of the
then remaining 1992 Option Shares. Such purchase shall occur within
forty-five (45) days following the receipt by the Company of the
written notice referred to in the immediately preceding sentence. The
purchase price for each share purchased pursuant to this Section 7(d)
shall be the Fair Market Value for the Company's common stock on the
date of such termination calculated as if such date was an Option
Purchase Date.
(e) If this Agreement is terminated by the Company other than
for Cause or by reason of Sardas' death or permanent disability, and
Sardas does not exercise the right set forth in Sections 7(c) or 7(d)
above, as applicable, then, in such event, Sardas shall have the right,
exercisable on the Option Purchase Date immediately following such
termination, to specify in his notice to the Company pursuant to
Section 7(b)(ii) above that the number of 1992 Option
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Shares as to which such right was being exercised is all, but not less
than all, of the then remaining 1992 Option Shares and such purchase
shall occur within forty-five (45) days following the receipt by the
Company of such written notice.
(f) If this Agreement is terminated by the Company other than
for Cause or is terminated by reason of Sardas' death or permanent
disability, and Sardas does not exercise either the right set forth in
Sections 7(c), 7(d) or 7(e) above, as applicable, then, in such event,
the provisions set forth in Section 7(b) shall continue as set forth
therein.
(g) If this Agreement is terminated by the Company for Cause,
then, in such event, the Company shall have the right, exercisable by
written notice to Sardas delivered within fifteen (15) days following
such termination, to purchase from Sardas for cash, and Sardas, subject
to the next sentence of this paragraph, shall be required to sell to
the Company, all, but not less than all, of the then remaining 1992
Option Shares. Such purchase shall occur within forty-five (45) days
following the delivery to Sardas of the written notice referred to in
the immediately preceding sentence, unless within fifteen (15) days
after such notice Xx. Xxxxxx, by written notice to the Company,
declines to tender his 1992 Option Shares. In such event, all of the
Company's obligations hereunder to repurchase the 1992 Option Shares
shall terminate except only for those obligations that shall have
arisen prior to such termination of employment. The purchase price for
each share purchased pursuant to this Section 7(g) shall be the Fair
Market Value for the Company's common stock on the date of such
termination calculated as if such date was an Option Purchase Date.
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8. New Option
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Effective immediately under entering into this Employment Agreement,
the Company and Sardas shall enter into a certain Stock Option Agreement,
substantially in the form of Exhibit A hereto, granting to Sardas the option to
purchase up to 200,000 shares of the Company's common stock, on the terms and
conditions as set forth therein. Such option shall be granted under the Plan (as
defined in the Stock Option Agreement) and subject to stockholder approval of
the Plan.
9. Business Expenses
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The Company shall reimburse Sardas for all reasonable and necessary
expenses incurred in carrying out his duties under this Agreement. Sardas shall
present to the Company from time to time itemized accounts of such expenses in
the usual form required by the Company.
10. Indemnification
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Sardas shall be covered by the Company's indemnification policies for
Directors and Officers and shall be offered an indemnification agreement in the
form as may from time to time be in effect with other Directors and Officers of
the Company.
11. Confidentiality
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Sardas agrees to be bound by the Company's confidentiality policy.
12. Arbitration
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Any controversy or claim arising out of, or relating to, this Agreement
or the breach thereof shall be settled by a three-member arbitration panel (one
member selected by the Company, one member by Sardas and one member selected by
the other two members, or if not by a court of competent jurisdiction), in
accordance with the governing rules of the
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American Arbitration Association. Judgment upon the award rendered shall be
final and may be entered in any court of competent jurisdiction in Cleveland,
Ohio.
13. Successors; Binding Agreement
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This Agreement and all rights of Sardas hereunder shall inure to the
benefit of, and be enforceable by Sardas's personal or legal representatives.
14. Modifications and Waivers
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No provisions of this Agreement may be modified or discharged unless
such modification or discharge is authorized by the Board and is agreed to in
writing, signed by Sardas and by another executive officer of the Company. No
waiver by either party hereto of any breach by the other party hereto or 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 at any prior or subsequent time.
15. Entire Agreement
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This Agreement constitutes the entire agreement of the parties hereto
relating to the subject matter hereof and there are no written or oral terms or
representations made by either party other than those contained herein.
16. Governing Law
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The validity, interpretation, construction, performance and enforcement
of this Agreement shall be governed by the laws of the State of Ohio.
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17. Invalidity
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The invalidity or unenforceability of any term or terms of this
Agreement shall not invalidate, make unenforceable or otherwise affect any other
term of this Agreement which shall remain in full force and effect.
IN WITNESS WHEREOF the parties have executed this Agreement as amended
as of the dates indicated above.
SUDBURY, INC.
By: /s/ Xxxx X. Xxxxx, Vice President
----------------------------------------
Xxxx X. Xxxxx, Vice President and
Chief Financial Officer
And: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx, Chairman
Compensation Committee of the
Board of Directors
/s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Xxxxxxx X. Xxxxxx, Individually
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EXHIBIT A
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SUDBURY, INC. NON-QUALIFIED STOCK OPTION AGREEMENT
--------------------------------------------------
This Agreement, dated this 28th day of July, 1995, by and between
Sudbury, Inc., a Delaware corporation with an office at 00000 Xxxxxxx Xxxx.,
Xxxxx 000, Xxxxxx Xxxx, Xxxx 00000 (the "Company") and Xxxxxxx X. Xxxxxx (the
"Employee"), a full-time employee of the Company or one of its subsidiaries.
SECTION 1. Under the provisions of the Company's 1995 Stock Option Plan
(the "Plan"), the Company hereby grants to the Employee the option of purchasing
an aggregate of 200,000 shares of common stock, par value $.01, of the Company
("Shares") at the price of $________ per share [market price], subject to the
terms and conditions as hereinafter set forth.
SECTION 2. Notwithstanding any other provisions herein, this option
shall expire no later than five (5) years from the date of this Agreement.
SECTION 3. The option granted pursuant to this Agreement shall vest on
the following schedule:
(a) options to purchase 100,000 Shares on January 13, 1996;
and
(b) options to purchase an additional 100,000 Shares on
January 13, 1997.
SECTION 4. This option is not transferable by the Employee other than
(a) by will or by the laws of descent and distribution, and is exercisable,
during the lifetime of the Employee, only by him or her, or in the event of
death, his or her estate, or in the event of disability, his or her personal
representative, or (b) pursuant to a qualified domestic relations order, as
defined in the 1986 Internal Revenue Code, as amended (the "Code") or Title 1 of
the Employee Retirement Income Security Act of 1974, as amended. Except as
otherwise provided in Sections 5, 6, and 9, this option can be exercised only if
the Employee has remained in the employ of the Company continuously from the
date this option is granted.
SECTION 5. In the event of termination of employment of the Employee
for any reason other than death, permanent disability (as defined in that
certain Employment Agreement between the Company and the Employee of even date
herewith (the "Employment Agreement")) or for Cause (as defined in the
Employment Agreement), then (a) the Employee, at any time within the three-month
period following such termination of employment (but within the term specified
in Section 2), may exercise the option rights or any unexercised portion thereof
to the extent such rights were otherwise exercisable by the Employee at the date
of termination of employment, and (b) the portion of the option not vested as of
the date of Employee's termination of employment shall automatically vest as of
the date of such termination. If, however, the Employee is terminated from
employment for Cause (as defined in the Employment Agreement), all option
rights, heretofore unexercised, shall expire.
SECTION 6. If the Employee shall die or become permanently disabled (as
defined in the Employment Agreement) while in the employ of the Company or
within the three-year
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period after termination of employment with the Company, (a) the option rights
or any unexercised portion thereof may be exercised within the one-year period
after the Employee's death or permanent disability (but within the term
specified in Section 2), by the person entitled by will or the applicable laws
of descent and distribution to the extent that the Employee was entitled to
exercise the same at the date of his or her death, and (b) the portion of the
option that has not vested as of the earlier of the Employee's (i) death or
permanent disability, as the case may be, or (ii) termination shall
automatically expire.
SECTION 7. Nothing herein contained shall confer upon the Employee any
right to continue in the employ of the Company, or limit or restrict any right
which the Company would otherwise have to terminate the employment of the
Employee with or without cause or to adjust his or her compensation.
SECTION 8. Subject to the provisions of Section 9(a) of this Agreement,
in the event that, during the term hereof and while the option as to any of the
Shares covered hereby shall remain unexercised, the number of Shares subject to
the Plan and to options granted under the Plan shall be adjusted as follows: (a)
in the event that all of the outstanding Shares are changed by any stock
dividend, stock split or recapitalization or in the event that extraordinary
cash or non-cash dividends are declared with respect to the Shares, the number
of Shares subject to the Plan and to options granted hereunder shall be
equitably adjusted; (b) in the event of any merger, consolidation or
reorganization of the Company with any other corporation or corporations, there
shall be substituted, on an equitable basis as determined by the Compensation
Committee of the Board of Directors (the "Committee"), for each Share then
subject to the Plan, whether or not at the time subject to outstanding options,
the number and kind of Shares or other securities to which the holders of Shares
of the Company will be entitled pursuant to the transaction; and (c) subject to
the provisions of Section 9(b) of this Agreement in the event of any other
relevant change in the capitalization of the Company, the Committee shall
provide for an equitable adjustment In the number of Shares then subject to the
Plan, whether or not then subject to outstanding options.
In the event of any such adjustment the purchase price per Share shall be
equitably adjusted. Any such adjustment or substitution may provide for the
elimination of any fractional Share which might otherwise become subject to an
option. The adjustment and manner of application of the foregoing provisions
shall be determined by the Committee in its sole discretion.
SECTION 9.
(a) If the Company shall liquidate or dissolve, or shall be a
party to a merger or consolidation or other business combination with
respect to which it shall not be the surviving corporation, the Company
shall give written notice thereof to the Employee at least thirty days
prior thereto, and notwithstanding the provisions of Section 3, the
Employee shall have the right within said thirty-day period (but within
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the term specified in Section 2) to exercise this option in full to the
extent not previously exercised. To the extent that this option shall
not have been exercised on or prior to the effective date of such
liquidation, dissolution, merger or consolidation, it shall terminate
on said date, unless it is assumed by another corporation.
(b) Notwithstanding the provisions of Section 3, the option
granted hereby shall become exercisable in full if and when any
corporation, partnership, joint venture, person, or a group acting
together ("Acquiring Entity") for a similar purpose shall directly or
indirectly acquire or announce an intent to directly or indirectly
acquire control of the Company or any successor or assignee of the
Company for purposes of this Section, control shall mean the
acquisition of, or the formation of a group whose members beneficially
own shares of the Company, which after giving effect thereto, shall
permit the Acquiring Entity to vote 45% or more of the aggregate voting
power, as measured by all Shares then outstanding, in the election of
directors of the Company.
SECTION 10. This option shall be exercised by delivering to the Company
at the office of its Secretary (a) a written notice, signed by the person
entitled to exercise the option, stating the number of Shares to be purchased
hereunder, (b) payment in an amount equal to the full purchase price of the
Shares to be purchased, and (c) in the event the option is exercised by a person
other than the Employee, evidence satisfactory to the Company that such person
has the right to exercise the option. Payment may be made, at the election of
the Employee (a) in cash (including check, bank draft, money order, or wire
transfer), (b) by delivering, in transferable form, that number of Shares which,
on the business day preceding the date of exercise, has an aggregate fair market
value equal to such purchase price, or (c) a combination of the foregoing. The
fair market value of the Shares shall be deemed to be (a) the closing price of
the Shares on the principal stock exchange on which the Shares are then traded
on the last business day preceding the date of exercise of the option, or (b) if
no sales take place on such day on any such exchange, the average of the last
reported closing bid and asked prices on such day as officially quoted on the
principal stock exchange on which the Shares are then traded, or (c) if the
Shares are not listed on any such exchange, the average of the last reported
closing bid and asked prices on the over-the-counter market on the day preceding
the date of exercise of the option. The National Association of Securities
Dealers Market System shall be deemed a principal stock exchange. The Employee
shall also pay, within the time period specified by the Company, any amounts
required to be withheld for federal, state, or local tax purposes as a result of
the exercise of the options. Upon due exercise of the option, the Company shall
issue in the name of the person exercising the option and deliver to such person
one or more certificates for the shares in respect of which the option shall
have been exercised. No holder of this option shall have any rights as a
stockholder in respect of any Shares as to which the option shall not have been
duly exercised and no rights as a shareholder shall arise in respect of any
Shares as to which the option shall have been duly exercised until and except to
the extent that a certificate or certificates for such Shares shall have been
issued.
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SECTION 11. This option shall not be exercisable if such exercise would
violate:
(a) Any applicable state securities law;
(b) Any applicable registration or other requirements under
the Securities Act of 1933, as amended, the Securities Exchange Act of
1934, as amended, or the listing requirements of any stock exchange; or
(c) Any applicable legal requirement of any other governmental
authority.
The Company agrees to make reasonable efforts to comply with the foregoing laws
and requirements so as to permit the exercise of this option. Furthermore, if a
Registration Statement with respect to the Shares to be issued upon the exercise
of this option is not in effect or if counsel for the Company deems it necessary
or desirable in order to avoid possible violation of the Securities Act of 1933,
as amended (the "Act"), the Company may require, as a condition to its issuance
and delivery of certificates for the Shares, the delivery to the Company of a
commitment in writing by the person exercising the option that at the time of
such exercise it is his or her intention to acquire such Shares for his or her
own account for investment only and not with a view to, or for resale in
connection with, the distribution thereof; that such person understands the
Shares may be "restricted securities" as defined in Rule 144 of the Securities
and Exchange Commission; and that any resale, transfer or other disposition of
said Shares will be accomplished only in compliance with Rule 144, of the Act,
or the other Rules and Regulations thereunder. The Company may place on the
certificates evidencing such shares an appropriate legend reflecting the
aforesaid commitment and may refuse to permit transfer of such certificates
until it has been furnished evidence satisfactory to it that no violation of the
Act or the Rules and Regulations thereunder would be involved in such transfer.
SECTION 12. References herein to the Company shall include all parents
and subsidiaries of the Company, and shall be determined consistently with the
definitions of parent and subsidiary in the Code and all relevant Treasury
Department Regulations.
SECTION 13. This option is a non-qualified stock option within the
meaning of Section 422 of the Code and shall not be treated or interpreted for
federal income tax purposes as an Incentive stock option as defined in the Code.
SECTION 14. The Committee shall have authority, subject to the express
provisions of the plan, to construe and interpret this Agreement and the Plan,
to establish, and to make all other determinations in the judgment of the
Committee necessary or desirable for the administration of the Plan. All
determinations of the Committee shall be final and binding upon all persons. The
Board of Directors may at any time or from time to time grant to the Committee
such further powers and authority as the Board shall determine to be necessary
or desirable.
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SECTION 15. All of the provisions of the Plan are incorporated herein
by reference and are made a part of this Agreement. To the extent any conflict
shall arise between this Agreement and the terms of the Plan, the Plan shall
control.
SECTION 16. This Agreement shall be governed by the laws of the state
of Delaware.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement in
duplicate as of the day and year first written above.
SUDBURY, INC.
By: /s/ Xxxx X. Xxxxx, Vice President
______________________________________
EMPLOYEE
/s/ Xxxxxxx X. Xxxxxx
_________________________________________
Xxxxxxx X. Xxxxxx
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