Exhibit Number 10.7
Form of Employment Agreement
E-42
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made in Richmond,
Indiana as of __________, ____, by and between Stant Corporation, a Delaware
corporation with its principal place of business at 000 Xxxxxxxx Xxxxx,
Xxxxxxxx, XX 00000 (the "Company"), and ______________, an individual residing
at __________________, ("Executive").
WITNESSETH:
WHEREAS, the Company desires to continue to retain the services of
Executive as its ______________, and Executive has indicated his willingness to
continue to provide his services in such position on the terms and conditions
set forth herein;
NOW THEREFORE, in consideration of the covenants and the agreements
herein contained, the parties agree as follows:
1. Services
During the Term of Employment (as defined in Subsection 3(a)
below), the Company hereby employs Executive as its ______________, and
Executive hereby accepts such employment. In his capacity as the Company's
______________, Executive shall devote substantially all his business time,
attention, skill and efforts to the faithful performance of his duties hereunder
and shall have the usual powers and duties vested in the office of the
______________ of a corporation of the size, stature and nature of the Company.
Executive shall report directly to the President and Chief Executive Officer of
the Company (the "President").
2. Compensation. For all services to be rendered by Executive
in any capacity hereunder, during the Term of Employment the Company shall
pay or provide to Executive, and Executive shall accept, the following
amounts and benefits:
(a) Base Salary. The Company shall pay to Executive in cash in
accordance with its regular payroll practices a base salary (the "Base Salary")
at the initial annual rate of $_______, which rate shall be reviewed by the
President on or about _________, ____ and annually thereafter. Such salary may
be increased, but not decreased, from time-to-time at the discretion of the
President, subject to such limitations as may be set from time to time by the
Compensation Committee (the "Committee") of the Board of Directors of the
Company (the "Board of Directors"), to reflect both merit and cost of living
increases, and upon any such increase in the annual rate of Executive's base
salary, such increased amount shall become the "Base Salary" for the remainder
of the Term of Employment.
(b) Incentive Compensation. Executive shall participate in an annual
incentive compensation plan for executives to be adopted by the Committee
whereby Executive shall have the opportunity each year to earn a cash bonus in
an amount of up to 50% of the Base Salary for such year based upon the
attainment of financial targets established for the Company and achievement of
individual personal objectives, with the opportunity each year to earn a cash
bonus in an amount in excess of 50% of the Base Salary for attainment of
extraordinary results. The cash bonus provided for in this Subsection 2(b) shall
be paid on or before the thirtieth (30th) day following the date of the
Auditor's Opinion on the financial statements of the Company for the year to
which the bonus relates. Notwithstanding any other provision in this plan, 10%
of Executive's bonus shall be based on satisfactory individual performance by
Executive. If Executive does not achieve his assigned objectives or fails to
meet or exceed high job performance expectations, no payment (or a reduced
payment) will be made for this bonus component. In such event the unpaid amount
will be credited to a bonus pool which will then be allocated by the Committee,
upon the recommendation of the President, to one or more bonus plan participants
whose job performance has been outstanding.
(c) Insurance; Pension Benefits. Executive shall participate to the
extent eligible in all insurance (including, without limitation, life, travel
and accident, medical and dental insurance), pension, deferred compensation,
disability, profit-sharing, retirement and other employee welfare and benefit
plans maintained from time to time by the Company for its executives or salaried
employees, to the extent that such executives or salaried employees participate,
in accordance with their respective terms, except as may otherwise be provided
herein. The Company reserves the right to change any such welfare or benefit
plan in the future, but no such change shall be applied retroactively or
adversely effect benefits already accrued. To the extent that years of service
are relevant to the vesting of benefits under any pension or retirement benefit
plan of the Company, Executive shall receive vesting credit thereunder for all
his years of service at the Company, any direct or indirect subsidiary of the
Company, and any predecessor of any of the foregoing.
(d) Fringe Benefits; Vacation. Executive shall participate in the
Company's automobile program and all other fringe benefits to the same extent as
other senior executives of the Company. Executive shall be entitled to a number
of paid vacation days each year as allowed under the Company's vacation policy
as currently in effect.
(e) Business Travel and Other Expenses. The Company shall pay or
reimburse Executive for all reasonable business travel and other business
expenses incurred by Executive in the course of performing his duties under this
Agreement, upon presentation by Executive of an itemized account of such
expenses.
3. Term of Employment and Termination.
(a) Term of Employment. The Term of Employment shall be the period of
time which begins on __________, ____ and ends on the date (the "Termination
Date") which is the earlier of (i) the day of Executive's death, (ii) the day
Executive reaches age 65 and (iii) the effective date of any termination of the
Term of Employment as provided for in this Agreement.
(b) Termination by the Company for Good Cause. The Company may
terminate the Term of Employment at any time for Good Cause (as defined in
Subsection 3(c) below). The Company shall notify (the "Good Cause Notice")
Executive in writing at least thirty (30) days in advance of any proposed
termination for Good Cause (which Good Cause Notice shall state the Good Cause
for which Executive is proposed to be dismissed in such detail as to permit a
reasonable assessment by Executive of the bonafides thereof). During such notice
period Executive shall have the opportunity to cure any breach if the same is
capable of being cured.
(c) Definition of Good Cause. For purposes of this Agreement, the
term "Good Cause" shall mean:
(i) a material breach by Executive of his obligations under this
Agreement,
(ii) material misconduct by Executiv in respect of such
obligations,
(iii) Executive's engaging in conduct which is immoral or illegal or
which brings Executive or the Company or any of its direct or
indirect subsidiaries (collectively the "Stant Group") into
disrepute or otherwise damages the business of the Stant Group
(as determined in the good faith judgment of the Board of
Directors), or
(iv) Executive's commission of an act of dishonesty or a felony,
which in any event is not cured by Executive prior to the effective date of the
termination of the Term of Employment referred to in the Good Cause Notice;
provided, however, that Good Cause shall not include: (a) bad judgment or
negligence, (b) any act or failure to act by Executive believed in good faith by
him to have been in or not opposed to the interests of the Stant Group, and (c)
any act or failure to act by Executive in respect of which a determination could
properly be made that Executive met the applicable standard of conduct described
for indemnification or reimbursement or payment of expenses under the Delaware
Corporation Law, or the By-laws or Restated Certificate of Incorporation of the
Company, or the Company's directors' and officers' liability insurance.
(d) Termination by the Company for Convenience. Subject to the
Company's obligations to pay or provide certain amounts and benefits pursuant to
Subsections 4(b) or (c) below, the Company may terminate the Term of Employment
at any time for its convenience upon a minimum of sixty (60) days' prior written
notice to Executive. In such event, the Company shall have the option of waiving
Executive's services during all or part of such notice period; provided,
however, that during such notice period the Company shall continue to pay or
provide to Executive the amounts and benefits described in Section 2 above.
(e) Events of Termination. The following shall constitute Events
of Termination:
(i) A reduction in (x) the Base Salary or (y) the percentage of
Base Salary which Executive may earn as an annual cash bonus
pursuant to Subsection 2(b) above;
(ii) A material reduction in the benefits available to Executive
under the Company's pension and/or pension restoration plans;
(iii) A material adverse change in Executive's duties and
responsibilities or position; and
(iv) An ordered relocation of Executive's place of employment which
results in his commutation increasing by more than fifty (50)
miles round trip (notwithstanding his right to be reimbursed
for all expenses in connection with such relocation).
The occurrence of any such event shall be treated as a termination of the Term
of Employment for the convenience of the Company pursuant to Subsection 3(d)
above, and the sixty (60) day notice period required by Subsection 3(d) above
shall be deemed to have commenced on the date Executive receives written notice
from the Company (the "Reduction Notice") of the proposed effective date of the
reduction, change or relocation to which Executive does not consent; provided,
however, that if Executive fails to notify the Company, in writing as elsewhere
provided herein, of Executive's objection to the proposed reduction, change or
relocation within ten (10) business days of his receipt of the Reduction Notice,
such failure to notify shall be conclusive evidence that Executive consented to
such reduction, change or relocation and waived any right to assert that such
reduction, change or relocation constitutes a breach of this Agreement or an
Event of Termination.
If the Term of Employment is terminated because of an Event of Termination, the
Company shall pay or provide to Executive all of the amounts and benefits
specified in Subsection 4(b) or (c) below.
(f) Termination by Executive for Convenience. Executive may terminate
the Term of Employment at any time for Executive's convenience, including his
election to retire at any time, upon a minimum of sixty (60) days' prior written
notice to the Company. The Company shall have the option of waiving all or part
of Executive's services during all or part of such notice period; provided,
however, that until the end of such notice period (i) the Company shall continue
to pay or provide to Executive the amounts and benefits described in Section 2
above and (ii) Executive shall continue to be an "employee" of the Company or
one of its subsidiaries and shall not commence active employment with another
employer.
In the event a purported termination of the Term of Employment by Executive
because of an Event of Termination is, for any reason, found to be invalid,
erroneous or incorrect, such termination shall be treated as a termination by
Executive for Executive's convenience pursuant to this Subsection 3(f).
4. Payments upon Termination of Term of Employment.
When the Term of Employment terminates, Executive shall be entitled to
the amounts and benefits provided in this Section 4 and no others:
(a) Termination by Company for Good Cause or by Executive for His
Convenience. If the Term of Employment is terminated by the Company for Good
Cause pursuant to Subsection 3(b) above or by Executive for his convenience
pursuant to Subsection 3(f) above, the Company shall:
(i) Continue to pay or provide to Executive the amounts and
benefits described in Section 2 above until the last day of
the Term of Employment (the "Termination Date").
(ii) Not later than the fifth (5th) business day following the
Termination Date, pay Executive in cash an amount equal to any
accrued but unpaid vacation pay.
(iii) As soon as such amount can be computed and, in any event, not
later than the sixtieth (60th) business day following the
Termination Date, pay Executive in cash an amount equal to any
earned but unpaid compensation under any incentive
compensation plan in which Executive participated during the
Term of Employment for all fiscal years completed during the
Term of Employment.
(iv) Provide any rights or benefits to which Executive may be
entitled under COBRA, and upon the expiration of any rights or
benefits to which Executive is entitled under COBRA, provide
to Executive the opportunity to continue to participate in all
of the Company's group medical and dental insurance programs
for the remainder of his life, provided Executive shall be
obligated to pay the entire cost of his participation in any
such program.
(v) Provide, in accordance with the terms of any such plan, any
rights or benefits to which Executive may be entitled under
any tax qualified or non-tax qualified welfare or retirement
plan of the Stant Group.
(b) Termination Prior to a Change of Control by Company for its
Convenience or due to an Event of Termination. If, prior to a Change of Control
(as defined in Section 6 below), the Term of Employment is terminated by the
Company for its convenience pursuant to Subsection 3(d) above or as a result of
an Event of Termination pursuant to Subsection 3(e) above, the Company shall:
(i) Continue to pay or provide to Executive the amounts and
benefits described in Section 2 above until the Termination
Date.
(ii) Not later than the fifth (5th) business day following the
Termination Date, pay Executive in cash an amount equal to any
accrued and unpaid vacation pay.
(iii) As soon as such amount can be computed and, in any event, not
later than the sixtieth (60th) business day following the
Termination Date, pay Executive in cash an amount equal to any
earned but unpaid compensation under any incentive
compensation plan in which Executive participated during the
Term of Employment for all fiscal years completed during the
Term of Employment.
(iv) Provide any rights or benefits to which Executive may be
entitled under COBRA, it being the intent of the parties to
this Agreement that any such rights and benefits shall
relate to the period of time immediately subsequent to the
Twelve Month Benefit Termination Date (as defined in clause
(vi) of this Subsection 4(b)); and upon the expiration of
any rights or benefits to which Executive is entitled under
COBRA, provide to Executive the opportunity to continue to
participate in all of the Company's group medical and
dental insurance programs for the remainder of his life,
provided Executive shall be obligated to pay the entire
cost of his participation in any such program.
(v) Provide, in accordance with the terms of any such plan, any
rights or benefits to which Executive may be entitled under
any tax qualified or non-tax qualified welfare or retirement
plan of the Stant Group, including the Company's Pension
Restoration Plan.
(vi) Pay Executive the Base Salary (payable not less frequently
than twice monthly) from the Termination Date through the last
day of the twelfth (12th) month following the Termination Date
(the "Twelve Month Benefit Termination Date"); provided,
however, that the amount payable pursuant to this clause (vi)
shall be subject to dollar for dollar reduction for base
salary earned from any other employer (Executive being under
no obligation to mitigate these payments).
(vii) Pay Executive in cash any unpaid compensation under any
incentive compensation plan in which Executive participated
during the Term of Employment (assuming full achievement of
personal targets, whether or not actually achieved or
established) with respect to the year in which the Term of
Employment ends; provided, however, that the amount of any
such compensation shall (a) be pro-rated to reflect the fact
that the Term of Employment ended prior to the end of the
period of time to which such incentive compensation relates
and (b) reflect fully the attainment or lack of attainment of
any financial targets incorporated into the plan.
(viii) Either:
(a) Provide Continued Participation under all insurance programs
and welfare plans referred to in Subsection 2(c) above until
the earlier of (i) the day Executive completes the eligibility
waiting period under another employer's substantially
equivalent insurance programs and welfare plans and (ii) the
Twelve Month Benefit Termination Date, or
(b) In the event the Company is unable, despite using its best
efforts, to arrange or permit Executive's Continued
Participation in any such program or plan as provided in
clause (viii)(a) above, pay Executive a cash amount equal to
the cost to Executive of obtaining benefits comparable to
those which would have been provided to Executive pursuant to
clause (viii)(a) above, such cash payment to be made to
Executive in installments on the last day of each calendar
month, each such installment to cover such costs as have been
incurred by Executive for the preceding month.
For purposes of this Agreement, "Continued Participation" in an insurance
program or welfare or benefit plan means the providing of benefits comparable to
or greater than the benefits that would have been provided to or for the benefit
of Executive had Executive continued to be a full time employee of the Stant
Group.
(ix) As to each defined benefit plan qualified under the Internal
Revenue Code of 1986, as amended (the "Tax Code") in which
Executive was participating sixty (60) days prior to the
Termination Date (the "Measurement Date"), pay Executive
in cash an amount equal to the value of the additional plan
benefit which would have accrued to Executive if Executive's
employment with the Stant Group had continued until the
Twelve Month Benefit Termination Date, to the extent that
Executive would have been vested in such benefitif Executive's
employment with the Stant Group had continued until the Twelve
Month Benefit Termination Date. Any payments to be made
to Executive under this clause (ix) shall be in addition to
any benefits due to Executive under the terms of such plans
and shall be made within six (6) months after the Termination
Date.
Calculation of the value of any such benefit shall be made on
the basis of the actuarial assumptions in use under such plan
on the Measurement Date.
(x) As to each defined contribution plan qualified under the Tax
Code in which Executive was participating on the Measurement
Date, pay Executive in cash an amount equal to the value of
any additional contribution which would have been made to such
plan by the Stant Group for Executive's account if Executive's
employment with the Stant Group had continued until the Twelve
Month Benefit Termination Date, to the extent Executive would
have been vested in such benefit if Executive's employment
with the Stant Group had continued until the Twelve Month
Benefit Termination Date.
Payments under this clause (x) shall be calculated as if
Executive had made all required plan contributions at the
maximum rate and had continued to receive annual compensation
at a rate equal to the Measurement Amount (as defined in
clause (vi) of Subsection 4(c) below). Any payments to be made
to Executive under this clause (x) shall be in addition to any
benefits due to Executive under the terms of such plans and
shall be made within six (6) months after the Termination
Date.
(xi) As to any non-qualified pension plan of the Company, provide
full credit for vesting and benefit accrual purposes (to the
extent that compensation and years of service are relevant in
computing benefits thereunder) until the Twelve Month Benefit
Termination Date based upon the assumption that during such
period Executive had continued to receive annual compensation
at a rate equal to the Measurement Amount.
(c) Termination After a Change of Control by the Company for its
Convenience or due to Event of Termination. If, after a Change of Control, the
Term of Employment is terminated by the Company for its convenience pursuant to
Subsection 3(d) above or as a result of an Event of Termination pursuant to
Subsection 3(e) above, the Company shall:
(i) Continue to pay or provide to Executive the amounts and
benefits described in Section 2 above until the
Termination Date.
(ii) Not later than the fifth (5th) business day following the
Termination Date, pay Executive in cash an amount for any
accrued and unpaid vacation pay.
(iii) Within five (5) business days after the Termination Date, pay
Executive an amount in cash equal to any earned but unpaid
compensation under any incentive compensation plan in which
Executive participated during the Term of Employment for all
fiscal years completed during the Term of Employment.
(iv) Provide any rights or benefits to which Executive may be
entitled under COBRA, it being the intent of the parties to
this Agreement that any such rights and benefits shall
relate to the period of time immediately subsequent to the
Twenty-Four Month Benefit Termination Date (as defined in
clause (viii) of Subsection 4(c) below); and upon the
expiration of any rights or benefits to which Executive is
entitled under COBRA, provide to Executive the opportunity
to continue to participate in all of the Company's group
medical and dental insurance programs for the remainde of
his life, provided Executive shall be obligated to pay the
entire cost of his participation in any such program.
(v) Provide, in accordance with the terms of any such plan, any
rights or benefits to which Executive may be entitled under
any tax qualified or non-tax qualified welfare or retirement
plan of the Stant Group.
(vi) Within five (5) business days after the Termination Date, pay
Executive in cash an amount equal to two (2) times the sum of
(a) the Base Salary in effect on the Measurement Date and (b)
the maximum amount Executive could have earned for a full
fiscal year under any incentive compensation plan in which
Executive was participating on the Measurement Date (assuming
full achievement of financial and personal targets, whether or
not actually achieved or established) with respect to the year
in which the Term of Employment ends (such sum being the
"Measurement Amount").
(vii) Pay Executive in cash any unpaid compensation under any
incentive compensation plan in which Executive participated
during the Term of Employment (assuming full achievement of
financial and personal targets, whether or not actually
achieved or established) with respect to the year in which the
Term of Employment ends.
(viii) Either:
(a) Provide Continued Participation under all insurance programs
and welfare plans referred to in Subsection 2(c) above until
the earlier of (i) the day Executive completes the eligibility
waiting period under another employer's substantially
equivalent insurance programs and welfare plans and (ii) the
last day of the twenty-fourth (24th) month following the
Termination Date (the "Twenty-Four Month Benefit Termination
Date"), or
(b) In the event the Company is unable, despite using its best
efforts, to arrange or permit Executive's Continued
Participation in any such program or plan as provided in
clause (viii)(a) above, pay Executive a cash amount equal to
the cost to Executive of obtaining benefits comparable to
those which would have been provided to Executive pursuant to
clause (viii)(a) above, such cash payment to be made to
Executive in installments on the last day of each calendar
month, each such installment to cover such costs as have been
incurred by Executive for the preceding month.
(ix) As to each defined benefit plan qualified under the
Tax Code in which Executive was participating on the
Measurement Date, pay Executive in cash an amount equal to
the value of the additional plan benefit which would have
accrued to Executive if Executive's employment with the
Stant Group had continued until the Twenty-Four Month Benefit
Termination Date, to the extent that Executive would have been
vested in such benefit if Executive's employment with the
Stant Group had continued until the Twenty-Four Month
Benefit Termination Date. Any payments to be made to Executive
under this clause (ix) shall be in addition to any benefits
due to Executive under the terms of such plans and shall be
made within five(5) business days after the Termination Date.
Calculation of the value of any such benefit shall be made on
the basis of the actuarial assumptions in use under such plan
on the Measurement Date.
(x) As to each defined contribution plan qualified under the Tax
Code in which Executive was participating on the Measurement
Date, pay Executive in cash an amount equal to the value of
any additional contribution which would have been made to such
plan by the Stant Group for Executive's account if Executive's
employment with the Stant Group had continued until the
Twenty-Four Month Benefit Termination Date, to the extent
Executive would have been vested in such benefit if
Executive's employment with the Stant Group had continued
until the Twenty-Four Month Benefit Termination Date.
Payments under this clause (x) shall be calculated as if
Executive had made all required plan contributions at the
maximum rate and had continued to receive annual compensation
at a rate equal to the Measurement Amount. Any payments to be
made to Executive under this clause (x) shall be in addition
to any benefits due to Executive under the terms of such plans
and shall be made within five (5) business days after the
Termination Date.
(xi) As to any non-qualified pension plan of the Company, provide
full credit for vesting and benefit accrual purposes (to the
extent that compensation and years of service are relevant in
computing benefits thereunder) until the Twenty-Four Month
Benefit Termination Date based upon the assumption that during
such period Executive had continued to receive annual
compensation at a rate equal to the Measurement Amount.
(xii) Provide Executive all fringe benefits which the Company was
providing to Executive on the Measurement Date until the
Twenty-Four Month Benefit Termination Date.
(d) Limitation of Amounts/Benefits. The amounts and benefits to be paid
or provided to Executive pursuant to Subsection 4(c) above (the "Severance
Benefit") shall be reduced as described below if the Company would, by reason of
section 280G of the Tax Code, not be entitled to deduct for federal income tax
purposes any part of the Severance Benefit or any part of any other payment or
benefit to which Executive is entitled under any plan or program. For the
purposes of this Agreement, the Company's independent auditors shall determine
the value of any deferred payments or benefits in accordance with the principles
of section 280G of the Tax Code, and tax counsel selected by the Company's
independent auditors and acceptable to the Company shall determine the
deductibility of payments and benefits to which Executive is entitled. The
Severance Benefit shall be reduced only to the extent required, in the opinion
of such tax counsel, to prevent such nondeductibility for federal income tax
purposes of any part of the remaining Severance Benefit and other payments and
benefits to which Executive is entitled. The Company shall determine which
elements of the Severance Benefit shall be reduced to conform to the provisions
of this Subparagraph. Any determination made by the Company's independent
auditors or by tax counsel pursuant to this paragraph shall be conclusive and
binding on Executive.
(e) Death. In the event of Executive's death during the Term of
Employment, and in addition to its obligations under any plan or program offered
to Executive which provides for payments or benefits after his death, the
Company shall:
(i) Continue to pay the Base Salary through the last day of the
second (2nd) month following the month in which Executive's
death occurs (the "Second Month Benefit Termination Date").
(ii) As soon as such amount can be computed and, in any event, not
later than the sixtieth (60th) business day after the
Termination Date, pay any earned but unpaid incentive
compensation under any plan for completed fiscal years plus
earned but unpaid compensation under such plan for the year in
which Executive's death occurs.
(iii) Continue to provide to the members of the immediate family of
the deceased Executive medical and dental insurance coverage
on the same basis that such coverage was provided immediately
prior to the Executive's death until the Second Month Benefit
Termination Date.
(iv) Provide any rights or benefits to which members of Executive's
immediate family may be entitled under COBRA, it being the
intent of the parties to this Agreement that any such rights
and benefits shall relate to the period of time immediately
subsequent to the Second Month Benefit Termination Date.
The payments to be made under this Subsection 4(e) shall be made to the person
or persons last designated as recipients of such payments by Executive in
written notice filed with the Company or, absent such designation, to
Executive's estate.
(f) Disability. If Executive becomes totally disabled, as defined below
in this Subsection, during the Term of Employment, Executive shall be entitled
to continuation of the Base Salary until the earlier of (i) the date six (6)
months following the date Executive became totally disabled and (ii) the date
benefits to Executive commence under the Company's Long Term Disability Plan (or
would have commenced if Executive had elected to participate in such plan).
In addition to the foregoing, Executive shall also receive under this Subsection
4(f) his prorated annual bonus through the date disability is determined and any
deferred vested annual bonuses. During the period of his disability, Executive
shall be entitled to continued participation in all Company employee benefit
plans (other than life insurance plans) including, but not limited to, continued
accrual of retirement benefits and coverage under the Company's medical and
hospitalization plans. The determination of disability shall be in accordance
with the Company's long-term disability program or in accordance with some other
acceptable definition.
(g) Death During Separation Period. In the event Executive dies while
receiving or entitled to any amount or benefit under Subsections 4(a), (b) or
(c) above, Executive's legal representative shall be entitled to receive the
amounts and benefits due Executive for the remainder of any periods specified in
such Subsections.
(h) No Duty to Seek Employment. Executive shall not be under any duty
or obligation to seek or accept employment at any time subsequent to the
Termination Date and, except as specifically provided under Subsections 4(b) and
4(c) above, no such other employment, if obtained, or compensation or benefits
payable in connection therewith, shall reduce any amounts or benefits to which
Executive is entitled hereunder.
(i) Notice of New Employment. If Executive commences full time
employment with any employer other than a member of the Stant Group prior to (i)
the Twelve Month Benefit Termination Date if the Term of Employment is
terminated pursuant to Subsections 3(d) or (e) above prior to a Change in
Control or (ii) the Twenty-Four Month Benefit Termination Date if the Term of
Employment is terminated pursuant to Subsections 3(d) or (e) after a Change in
Control, then Executive shall provide the Company with written notice of such
employment no later than the first day of the calendar month immediately
following the date on which Executive commences such employment.
5. No Other Severance; General Release of the Stant Group.
In consideration for the amounts and benefits due Executive under
Section 4 above, and as a condition of receiving any such amounts or benefits,
Executive shall
(a) not be entitled to any payments or benefits under any severance
policy of general application to executives or salaried employees of the
Company, and
(b) deliver to the Company a general release (the "General Release")
releasing each member of the Stant Group and the present and former directors,
officers, employees and assigns of any such person (collectively the
"Releasees") from any and all liability which the Releasees or any one or more
of them had or have or may in the future have to Executive or Executive's
successors, heirs, executors and administrators with respect to any and all
actions, suits, contracts, agreements, damages and claims of any kind
whatsoever, in law or in equity, from the beginning of the world until the date
of the General Release, including without limiting the generality of the
foregoing any and all claims arising out of or relating in any way whatsoever to
the employment of Executive by any of the Releasees; provided, however, that the
General Release shall not release the Company from any of its obligations under
this Agreement. The General Release shall be in the form of Exhibit A to this
Agreement or in such different or other form as the Company in its reasonable
discretion shall consider necessary or appropriate to ensure the full
enforceability of the General Release under applicable federal, state and local
laws.
6. Change of Control; Attorney's Fees Following a Change of Control.
The term "Change of Control" means (i) the acquisition by any Person
(as such term is defined in Section 13(d) of the Exchange Act) of 20% or more of
the combined voting power of the Company's outstanding securities entitled to
vote generally in the election of Directors (the "Voting Securities") or (ii) a
majority of the Directors of the Company are individuals who were not nominated
by the Board of Directors; provided, however, that (y) the acquisition or
disposition of any portion of the combined voting power of the Voting Securities
by Bessemer Capital Partners LP ("BCP") and/or by any Person affiliated with BCP
(BCP and all such Persons being, collectively, the "Bessemer Group") shall in no
event constitute a Change of Control and (z) the acquisition by any person who
is not a member of the Bessemer Group of 20% or more of the combined voting
power of the Voting Securities shall not constitute a Change of Control so long
as during the entire time such Person possesses 20% or more of such voting power
the Bessemer Group has the power to vote 50% or more of such voting power. In
any dispute or controversy arising under this Agreement following a Change of
Control, the Company agrees to pay the reasonable fees and expenses of one legal
counsel for Executive; provided, however, that Executive acts in good faith and
in the reasonable belief of the merit of Executive's position.
7. Trade Secrets
Executive recognizes that by reason of his employment hereunder and his
prior employment with one or more members of the Stant Group, he may have
acquired or will in the future acquire confidential information which belongs to
or concerns one or more members of the Stant Group ("Confidential Information").
Accordingly, Executive agrees that he will not, directly or indirectly, except
to the extent required by law or after obtaining the written consent of the
Board of Directors, disclose, or use for his own benefit, any Confidential
Information that Executive has learned by reason of his association with the
Stant Group or use any such information to the detriment of the Stant Group. For
purposes of this Section 7, the term "Confidential Information" shall include
all information not publicly available relating to the activities, operations,
finances, products and services of the Stant Group, including but not limited to
plans, processes, research, programs, ideas, marketing and sale of product
information, customer information, costs, pricing, trade secrets and other
intellectual property. In the event of a violation of this provision by
Executive, the Company shall be entitled, in addition to any other right or
remedy it may have, to an injunction, without the posting of any bond or other
security, enjoining or restraining Executive from any violation or threatened
violation of this provision. Executive shall deliver to the Company at the
termination of the Term of Employment or at any other time the Company may
request, all memoranda, notes, plans, records, financial data and projections,
reports and other documents (and copies thereof) relating to the business of the
Stant Group which he may then possess or have under his control. The agreement
of Executive as set forth in this Section 7 shall survive the termination of
this Agreement.
8. Inventions.
(a) Assignment of Inventions. Executive will assign and hereby does
assign to the Company his entire right, title and interest in the following
inventions and developments, whether patentable or unpatentable, which Executive
makes or conceives or reduces to practice, solely or jointly with others:
(i) Inventions and developments made or conceived or reduced to
practice at any time during Executive's employment by any
member of the Stant Group, whether during working hours or
not, which relate in any way to products manufactured or
business conducted by any member of the Stant Group at any
time during the period of Executive's employment or which in
any other way relate to any subject matter with which
Executive's work for any member of the Stant Group is
concerned;
(ii) Inventions and developments made or conceived or reduced to
practice at any time during, before or after Executive's
employment by any member of the Stant Group which were made or
conceived or reduced to practice with the use of the time,
materials or facilities of any member of the Stant Group; and
(iii) Inventions and developments made or conceived or reduced to
practice by Executive during the six month period following
the Termination Date and which directly or indirectly result
from work initiated, conducted, observed or contemplated
during Executive's employment by any member of the Stant
Group.
(b) Disclosure of Inventions. Executive will promptly disclose in
writing to the Company each invention and development of the type set forth in
Subsection 8(a) above.
(c) Assistance. Both during and after Executive's employment by the
Stant Group, and without charge to the Stant Group but at the Stant Group's
expense, Executive will do all such acts and execute, acknowledge and deliver
all papers considered by the Stant Group to be reasonably necessary or advisable
for obtaining patents in the United States and any other country for inventions
and developments of the type described in Subsection 8(a) above and for vesting
or evidencing title to such inventions and developments and to such patents in
the Company or its nominee. Executive will also give all reasonable assistance
to the Stant Group in any litigation or controversy involving said inventions;
provided, however, that should such services be rendered after the Term of
Employment, a reasonable compensation shall be paid to Executive upon a per diem
basis.
9. Noncompete
If the Term of Employment is terminated by the Executive pursuant to
Subsection 3(f) above or by the Company pursuant to Subsection 3(b) above, for a
period of twelve (12) months after the Termination Date, Executive shall not (i)
directly or indirectly engage in any business substantially similar to the
business conducted by the Stant Group in any geographical area in which the
Stant Group conducts such business, (ii) participate in the sale to any customer
of the Stant Group of products which are substantially similar to those sold to
such customer by the Stant Group, (iii) have any significant interest, directly
or indirectly, in any such business; provided, however, that nothing herein will
prevent Executive from owning in the aggregate not more than five (5) percent of
the outstanding stock of any class of a corporation which is publicly traded, so
long as Executive has no participation in the management of such corporation, or
(iv) directly or indirectly solicit or induce any employee of the Stant Group to
terminate his or her employment with the Stant Group or otherwise interfere with
such employee's employment relationship with the Stant Group.
10. Representations and Warranties
Executive hereby represents and warrants that he is not prohibited from
either entering into this Agreement or fully performing any or all of his
obligations hereunder.
11. Assignment and Delegation
Executive may not without the Company's written consent thereto assign,
transfer or convey his rights or obligations under this Agreement. This
Agreement and all of the Company's rights and obligations hereunder may be
assigned or transferred by it, in whole but not in part, to and shall be binding
upon and inure to the benefit of any successor of the Company, but such
assignment by the Company shall not relieve it of any of its obligations
hereunder. As used herein, the term "successor" shall mean any business entity
which at any time by merger, consolidation or otherwise shall have acquired all
or substantially all of the business and assets of the Stant Group.
12. Amendments
No alteration, amendment, change or addition hereto shall be binding or
effective unless the same is set forth in a writing that is signed by each party
hereto.
13. Partial Invalidity
If the final judgment of a court of competent jurisdiction declares,
after the expiration of the time within which judicial review (if permitted) of
such judgment may be perfected, that any term or provision hereof is invalid or
unenforceable, (a) the remaining terms and provisions hereof shall be unimpaired
and (b) the invalid or unenforceable term or provision shall be deemed replaced
by a term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision.
14. Notices
All communications, notices and consents provided for herein shall be
in writing and be given in person or by means of facsimile or other means of
wire transmission (with request for assurance of receipt in a manner typical
with respect to communications of that type) or by mail or overnight delivery
service, and shall become effective (i) on delivery if given to a person, (ii)
on the date of transmission if sent by facsimile or other means of wire
transmission, or (iii) four business days after being deposited in the United
States mails, with proper postage and documentation, for First-Class Registered
or Certified mail, prepaid. Notices shall be addressed as follows:
(a) if to Executive, to:
Facsimile number: (000) 000-0000
(b) if to the Company, to: Stant Corporation
000 Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attn: X. X. Xxxxxx, President
Facsimile number: (000) 000-0000
provided, however, that if any party shall have designated a different address
by notice given in accordance with this Section 14 to the other party to this
Agreement, then the last address so designated shall control.
15. Waivers
A waiver by either party of any breach of any provision of this
Agreement shall not be deemed to constitute a waiver of any preceding or
subsequent breach of the same or any other provision of this Agreement.
16. Governing Law
All matters respecting this Agreement, including the validity thereof,
are to be governed by, and interpreted, construed and enforced in accordance
with, the internal (and not conflict) laws of the State of Indiana.
17. Consent to Jurisdiction; Availability of TROs and Injunctions.
Executive hereby expressly and irrevocably (i) agrees that the Company
may bring any action, whether at law or in equity, arising out of or based upon
this Agreement in the State of Indiana or in any federal court therein, (ii)
consents to personal jurisdiction in any such court and to accept service of
process in accordance with the provisions of the laws of the State of Indiana,
and (iii) agrees that in addition to any other remedy provided at law or in
equity, the Company shall be entitled to a temporary restraining order and both
preliminary and permanent injunctions restraining Executive from violating any
of the provisions of Sections 7, 8 or 9 above.
18. Supersedes Prior Agreements; Entire Agreement
This Agreement automatically terminates, supersedes and replaces any
and all other agreements, promises, understandings and arrangements, whether
written or oral, express or implied, between Executive and any member of the
Stant Group relating to Executive's employment or conditions of employment
(except any pre-existing contractual obligations of Executive concerning
confidentiality or assignment of patents, inventions, ideas or intellectual
property). This instrument contains the entire agreement between the parties
with respect to the subject matter hereof. This Agreement may not be changed
orally but only by agreement in writing signed on behalf of the Company by the
President.
IN WITNESS WHEREOF, the parties hereto have executed this agreement, as
of the date and year first above written.
STANT CORPORATION
Attest
By:
-------------------------- -----------------------
Secretary President and Chief Executive Officer
EXECUTIVE
Witness
-------------------------- -------------------------
(Typed Name of Executive)
