Executive Severance Agreement
September 22, 0000
Xxxx X. Xxxx
000 Xxxxxxxx Xxxxxxxxx
Xxxx Xxxxxx, XX 00000 Executive
Tektronix, Inc.,
an Oregon corporation
X.X. Xxx 0000
Xxxxxxxxxxx, Xxxxxx Tektronix
Tektronix considers the establishment and maintenance of a sound
and vital management to be essential to protecting and enhancing
the best interests of Tektronix and its shareholders. In order to
induce Executive to remain employed by Tektronix in the face of
uncertainties about the long-term strategies of Tektronix and their
potential impact on the scope and nature of Executive's position
with Tektronix, this Agreement, which has been approved by the
Organization and Compensation Committee of the Board of Directors
of Tektronix, sets forth the severance benefits that Tektronix will
provide to Executive in the event Executive's employment by
Tektronix is terminated under the circumstances described in this
Agreement.
1. Employment Relationship. Executive is currently employed by
Tektronix as Vice President and Chief Financial Officer.
Executive and Tektronix acknowledge that either party may
terminate this employment relationship at any time and for any
reason, subject to the obligation of Tektronix to provide the
benefits specified in this Agreement in accordance with the
terms hereof.
2. Release of Claims. In consideration for the severance
benefits outlined in this Agreement, Executive agrees to
execute a Release of Claims in the form attached as Exhibit A
("Release of Claims"). Executive promises to execute and
deliver the Release of Claims to Tektronix within the later of
forty-five (45) days from the date Executive receives the
Release of Claims or on the last day of Executive's active
employment.
3. Compensation Upon Termination. In the event that Executive's
employment is terminated at any time by Tektronix other than
for Cause (as defined in Section 6.1 of this Agreement),
death, or Disability (as defined in Section 6.2 of this
Agreement), subject to Executive's execution of a Release of
Claims, Executive shall be entitled to the following benefits:
3.1 As severance pay and in lieu of any further pay for
periods subsequent to the date of termination, Tektronix
shall pay Executive, in a single payment within the later
of forty-five (45) days after termination of employment
or eight days after execution of the Release of Claims,
an amount in cash equal to Executive's annual base pay at
the rate in effect immediately prior to the date of
termination, or, if greater, an amount in cash equal to
Executive's average annual base pay for the three years
ending with Executive's last pay change preceding
termination.
3.2 Executive is entitled to extend coverage under any group
health plan in which Executive and Executive's dependents
are enrolled at the time of termination of employment
under the COBRA continuation laws for the 18-month
statutory period, or so long as Executive remains
eligible under COBRA.
Tektronix will pay Executive a lump sum payment in an
amount equivalent to the reasonably estimated cost
Executive may incur to extend for a period of eighteen
(18) months under the COBRA continuation laws Executive's
group health and dental plan coverage in effect at the
time of termination. Executive may use this payment, as
well as any payment made under 3.1, for such COBRA
continuation coverage or for any other purpose.
3.3 Except as provided in Section 5.2, Executive shall be
entitled to a portion of the benefits under any incentive
plans in effect at the time of termination (including the
Results Sharing Plan and the Annual Performance Improve
ment Plan), prorated for the portion of the plan year
during which Executive was a participant. For purposes
of this Agreement, Executive's participation in the
Annual Performance Improvement Plan will be considered to
have ended on Executive's last day of active employment.
Prorated awards shall not be due and payable by Tektronix
to Executive until the date that all awards are paid
after the close of the incentive period. Unless the
applicable plan provides for a greater payment for a
participant whose employment terminates prior to the end
of an incentive period (in which case the applicable plan
payment shall be made), the proration shall be calculated
pursuant to this Section 3.3. The payment, if any, that
would have been made under Executive's award had Execu-
tive been made a participant for the full incentive
period shall be calculated at the end of the incentive
period. Such amount shall be divided by the total number
of days in the incentive period and the result multiplied
by the actual number of days Executive participated in
the plan.
3.4 Tektronix will pay up to $12,500 to a third party
outplacement firm selected by Executive to provide career
counseling assistance to Executive for a period of one
(1) year following Executive's termination date.
3.5 Tektronix will permit Executive to continue to partici-
xxxx in its Executive Financial Counseling Program
through the remainder of the term of Executive's current
participation (which shall in no case be longer than one
(1) year after the effective date of Executive's termina-
tion).
4. Subsequent Employment. The amount of any payment provided for
in this Agreement shall not be reduced, offset or subject to
recovery by Tektronix by reason of any compensation earned by
Executive as the result of employment by another employer
after termination.
5. Other Agreements.
5.1 In the event that severance benefits are payable to
Executive under any other agreement with Tektronix in
effect at the time of termination (including but not
limited to any change of control, "golden parachute" or
employment agreement, but excluding for this purpose any
stock option agreement or stock bonus agreement or stock
appreciation right agreement that may provide for
accelerated vesting or related benefits upon the occur
rence of a change in control), the benefits provided in
this Agreement shall not be payable to Executive.
Executive may, however, elect to receive all of the
benefits provided for in this Agreement in lieu of all of
the benefits provided in all such other agreements. Any
such election shall be made with respect to the agree
ments as a whole, and Executive cannot select some bene-
fits from one agreement and other benefits from this
Agreement.
5.2 The vesting or accrual of stock options, restricted
stock, stock bonuses, or any other stock awards shall not
continue following termination. Any agreements between
Executive and Tektronix that relate to stock awards
(including but not limited to stock options, long term
incentive program, stock bonuses and restricted stock)
shall be governed by such agreements and shall not be
affected by this Agreement.
6. Definitions.
6.1 Cause. Termination by Tektronix of Executive's employ
ment for "Cause" shall mean termination upon (a) the
willful and continued failure by Executive to perform
substantially Executive's reasonably assigned duties with
Tektronix (other than any such failure resulting from
Executive's incapacity due to physical or mental illness)
after a demand for substantial performance is
delivered to Executive by the Chairman of
the Board of Directors or the President of
Tektronix which specifically identifies the manner in
which such executive believes that Executive has not
substantially performed Executive's duties, or (b) the
willful engaging by Executive in illegal conduct which is
materially and demonstrably injurious to Tektronix. For
purposes of this Section 6.1, no act, or failure to act,
on Executive's part shall be considered "willful" unless
done, or omitted to be done, by Executive in knowing bad
faith and without reasonable belief that Executive's
action or omission was in, or not opposed to, the best
interests of Tektronix. Any act, or failure to act,
based upon authority given pursuant to a resolution duly
adopted by the Board of Directors or based upon the
advice of counsel for Tektronix shall be conclusively
presumed to be done, or omitted to be done, by Executive
in good faith and in the best interests of Tektronix.
6.2 Disability. Termination by Tektronix of Executive's
employment based on "Disability" shall mean termination
because of Executive's absence from Executive's duties
with Tektronix on a full-time basis for one hundred
eighty (180) consecutive days as a result of Executive's
incapacity due to physical or mental illness, unless
within thirty (30) days after notice of termination by
Tektronix following such absence Executive shall have
returned to the full-time performance of Executive's
duties.
7. Successors; Binding Agreement.
7.1 This Agreement shall be binding on and inure to the
benefit of Tektronix and its successors and assigns.
7.2 This Agreement shall inure to the benefit of and be
enforceable by Executive and Executive's legal
representatives, executors, administrators and heirs.
8. Resignation of Corporate Offices. Executive will resign
Executive's office, if any, as a director, officer or trustee
of Tektronix, its subsidiaries or affiliates, effective as of
the date of termination of employment. Executive agrees to
provide Tektronix such written resignation(s) upon request.
9. Governing Law, Arbitration. This Agreement shall be construed
in accordance with and governed by the laws of the State of
Oregon. Any dispute or controversy arising under or in
connection with this Agreement or the breach thereof, shall be
settled exclusively by arbitration in Portland, Oregon in
accordance with the Commercial Arbitration Rules of the
American Arbitration Association, and judgment upon the award
rendered by the Arbitrator may be entered in any Court having
jurisdiction thereof.
10. Fees and Expenses. In the event that Executive initiates
arbitration under the circumstances described in this Agree-
ment to obtain or enforce any right or benefit provided by
this Agreement and the arbitrator determines that Executive is
the prevailing party, Executive shall be permitted to recover
Executive's reasonable attorneys' fees and costs incurred in
connection with such proceeding. In the event that the
arbitrator determines that Tektronix is the prevailing party,
each party shall bear its own attorneys' fees and costs
incurred in connection with such proceeding.
11. Amendment. No provision of this Agreement may be modified
unless such modification is agreed to in a writing signed by
Executive and Tektronix.
Tektronix, Inc. XXXX X. XXXX
______________
Xxxx X. Xxxx
By: XXXXXX X. XXXXX
__________________
Title: Chairman and CEO
Exhibit A
RELEASE OF CLAIMS
This Release of Claims (the "Release") is made and executed by
_________________________________ in connection with the termina-
tion of my employment with Tektronix, Inc. ("Tektronix") and in
consideration of my receiving valuable severance pay and benefits
as provided for in the Executive Severance Agreement ("Agreement").
These benefits are substantial consideration to which I am not
otherwise entitled.
On behalf of myself and my spouse, heirs, administrators and
assigns, I hereby release Tektronix, its parent and related
corporations, affiliates, or joint venturers and all officers,
directors, employees, agents, and insurers of the aforementioned
(collectively the "Company") from any and all liability, damages or
causes of action, whether known or unknown relating to my employ
ment with the Company or the termination of that employment,
including but not limited to any claims for additional compensation
in any form, or damages. This specifically includes, but is not
limited to, all claims for relief or remedy under any state or
federal laws, including but not limited to Title VII of the Civil
Rights Act of 1964, the Post-Civil War Civil Rights Acts (42 USC Sections
1981-1988), the Civil Rights Act of 1991, the Equal Pay Act, the
Age Discrimination in Employment Act of 1967, the Americans with
Disabilities Act, the Older Workers Benefit Protection Act, the
Worker Adjustment and Retraining Notification Act, the Rehabilita-
tion Act of 1973, the Vietnam Era Veterans' Readjustment Assistance
Act, the Fair Labor Standards Act, Executive Order 11246, all as
amended, and the civil rights, employment and labor laws of the
state of any state or the United States.
This Release shall not affect any rights which I may have under any
medical insurance, disability, workers' compensation, unemployment
compensation or retirement plans maintained by the Company.
I acknowledge that I have been given at least 45 days to consider
whether to execute this Release of Claims and accept benefits under
the Program; that I have been advised of my right to consult with
an attorney or financial advisor of my choice and at my own
expense; that the Agreement gives me severance pay and benefits
which the Company would otherwise have no obligation to give me;
and that I voluntarily enter into the Release of Claims.
I understand that the Release of Claims is to be signed within 45
days from the date I received it or on my last day of employment,
whichever is later, and that I may revoke the Release of Claims,
provided I do so in writing within seven (7) days of signing the
Release. I understand and agree that the Company will have no
obligation to pay me any benefits under the Agreement until the
expiration of the revocation period, provided I have not revoked
the Release of Claims. I understand that if I revoke the Release
of Claims my termination will nonetheless remain in full force and
effect and I will not be entitled to any benefits under the
Agreement.
I acknowledge that I have had time to consider the alternatives and
consequences of my election to receive benefits under the Agreement
and of signing the Release; that I am aware of my right to consult
an attorney or financial advisor at my own expense; and that, in
consideration for executing this Release and my election to receive
benefits under the Agreement, I have received additional benefits
and compensation of value to which I would not otherwise be
entitled.
I HAVE READ THE FOREGOING RELEASE. I UNDERSTAND THE EFFECT OF THIS
RELEASE AND I VOLUNTARILY ENTER INTO IT AT THIS TIME.
Every provision of this Release is intended to be severable. In
the event any term or provision contained in this Release is
determined to be illegal, invalid or unenforceable, such illegal
ity, invalidity or unenforceability shall not affect the other
terms and provisions of this Release which shall continue in full
force and effect.
Dated: __________________, 1993
____________________________
Employee Name
____________________________
Employee Signature
AMENDMENT NO. 1
to
EXECUTIVE SEVERANCE AGREEMENT
June 23, 0000
Xxxx X. Xxxx
0000 Xxxxxxxx Xxxxxxxxx
Xxxx Xxxxxx, Xxxxxx 00000 Executive
Tektronix, Inc.
an Oregon corporation
XX Xxx 0000, M/S 63-LAW
00000 XX Xxxxxxx
Xxxxxxxxxxx, Xxxxxx 00000-0000 Tektronix
The Executive Severance Agreement dated September 22, 1993
is amended as follows to reflect the Split Dollar Insurance
Agreement between the parties dated as of June 23, 1994 (the
Split Dollar Agreement).
1. Split Dollar Insurance Benefits.
New Sections 4 and 5 are added as follows, existing
Sections 4 through 11 are renumbered 6 through 13 respectively,
and cross-references are adjusted accordingly:
4. Split Dollar Insurance Adjustments Before Five
Years of Service. If Executive terminates employment before
completing five years of service (i.e., before becoming
entitled to benefits under the Supplemental Executive
Retirement Agreement with Tektronix dated March 17, 1993) the
following shall apply:
4.1 Any amount payable under Section 3 shall
be reduced by the net value of the Split Dollar
Insurance issued on Executive's life under the
Split Dollar Insurance Agreement between the
parties dated as of June 23, 1994.
4.2 The net value of the insurance under 4.1
is the cash surrender value of the Insurance less
the amount recoverable by Tektronix under the
Collateral Assignment.
5. Split Dollar Insurance Adjustments After Five Years
of Service. If Executive terminates employment voluntarily
or involuntarily for any reason other than death after
completing five years of service and before the Full Funding
Date under 5.4 below, the following shall apply:
5.1 Tektronix shall not, before the Full
Funding Date, exercise its rights under the Split
Dollar Agreement or the related Collateral
Assignment to withdraw the cash surrender value of
the Split Dollar Policy on termination of the Split
Dollar Agreement because of Executive's termination
of employment.
5.2 Except as provided below, Tektronix shall
pay Executive $54,722 as of each June 23 after the
date of termination up to the Full Funding Date.
The last payment shall be made as of the Full
Funding Date. The amount for the last payment
shall be pro-rated on a daily basis to the Full
Funding Date.
5.3 Tektronix shall take no action that would
interfere with Executive's payment of scheduled
employee premiums under the Split Dollar Policy up
to the Full Funding Date. Executive shall have no
obligation to pay such premiums. Tektronix's
obligation to pay under 5.2 above is not
conditioned upon Executive's payment of such
premiums.
5.4 "Full Funding Date" means the first date
on which any of the following occurs:
(a) Executive dies.
(b) The net value of the Split Dollar
Insurance described in 4.1 and 4.2 equals or
exceeds the present value of Executive's Base
Pay Retirement Supplement. Present value for
this purpose shall be determined under the
actuarial assumptions for calculating
equivalent benefits under the Tektronix
Pension Plan, as in effect when the
determination is made or, if that plan no
longer exists, under a successor defined
benefit pension plan. If Executive
receives an make any scheduled premium
payment from the Split Dollar Policy or
if Executive fails to make any scheduled
premium payment under the Split Dollar
Policy, the net value of the Split Dollar
Policy for purposes of this Section shall
be increased to the net value that would
have resulted if such distribution, loan
or other payment had not been received,
or such scheduled premium had been paid.
(c) Executive surrenders the policy or
causes it to lapse.
(d) Two years elapse from the date of
Executive's retirement.
5.5 "Base Pay Retirement Supplement" means
the portion of the retirement benefit provided to
Executive under his Supplemental Executive
Retirement Agreement with Tektronix dated March 17,
1993, that is attributable to base pay and not to
other types of pay included in "Final Average
Compensation" as defined in such Agreement.
2. Conforming Amendment.
Section 5.1 (to be renumbered 7.1) is revised by inserting
"except for benefits under Section 5" so the last phrase of the
first sentence of Section 5.1 will read as follows:
* * *, the benefits provided in this Agreement shall not
be payable to Executive except for benefits under
Section 5.
3. Effective Date.
This Amendment shall be effective as of June 23, 1994.
Executive XXXX X. XXXX
_____________
Xxxx X. Xxxx
Tektronix TEKTRONIX, INC.
By XXXXXX X. XXXXX
________________
Xxxxxx X. Xxxxx
Chairman and Chief
Executive Officer
