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EXHIBIT 10
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT is made and entered into this 12th day of
October, 1995, between Sudbury, Inc., a Delaware corporation, with its
principal office located at 00000 Xxxxxxx Xxxx., Xxxxxxxxx, Xxxx, 00000,
(together with its successors and assigns permitted under this Agreement, the
"Company"), and Xxxx X. Xxxxx, who resides at 0000 Xxxxxxxx Xxxxx, Xxxxxxx,
Xxxx 00000, (the "Executive").
W I T N E S S E T H:
WHEREAS, the Executive is Vice President and Chief Financial Officer of
the Company and an integral part of its management; and
WHEREAS, the Company has determined that it is in the best interest of
the Company and its stockholders to enter into an employment agreement setting
forth the obligations and duties of both the Company and the Executive (this
"Agreement");
NOW, THEREFORE, in consideration of the mutual covenants contained
herein and for other good and valuable consideration, the receipt of which is
mutually acknowledged, the Company and the Executive agree as follows:
1. DEFINITIONS.
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a. "BASE SALARY" shall mean the Executive's annual salary, as adjusted
from time to time.
b. "BOARD" shall mean the Board of Directors of the Company.
c. "CAUSE" shall mean:
i. the Executive's fraud, dishonesty, willful misconduct or
deliberate injury to the Company or its subsidiaries in the performance
of his duties hereunder;
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ii. the Executive's intentional and repeated refusal or failure
to perform his duties consistent with his position with the Company; or
iii. the Executive's material breach of any provision of this
Agreement.
d. "CHANGE IN CONTROL" shall mean a change in control of the Company of
a nature that would be required to be reported in response to Item 6(e) of
Schedule 14A promulgated under the Exchange Act, whether or not the Company is
then subject to such reporting requirement; provided that, without limitation,
a Change in Control shall be deemed to have occurred:
i. if any "person" (as defined in subsection 3(a)(9)
of the Exchange Act and as used in subsections 13(d) and 14(d) of the
Exchange Act), other than a person with which the Executive is
affiliated or of which he is a part and other than any employee benefit
plan sponsored by the Company (including any trustee of such plan),
becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company
representing 45% or more of the combined voting power of the
Company's then outstanding securities; or
ii. in the event of a plan of complete liquidation of
the Company or the sale or disposition by the Company of all or
substantially all of the Company's assets. An event or occurrence (or
series of events or occurrences) that would not otherwise constitute a
Change in Control under the foregoing shall be deemed to constitute a
Change in Control for purposes of this Agreement if the Board, by
majority vote, determines that a Change in Control does result
therefrom. A determination by directors under this subsection
1(d) shall be made solely for
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purposes of this Agreement and shall not directly or indirectly affect
any determination or analysis of whether a Change in Control results
for any other purpose. Any determination made with respect to whether
a change in control results for purposes of any other agreement or
plan of the Company shall have no effect for purposes of this
Agreement.
e. "CONSTRUCTIVE TERMINATION WITHOUT CAUSE" shall mean a termination of
the Executive's employment at his initiative following the occurrence, without
his prior written consent, of one or more of the following events (except in
connection with a termination of the Executive's employment for one of the
other reasons specified in Section 7 below):
i. a reduction in the Executive's Base Salary or the failure
of the Company to satisfy in all material respects its obligations to
protect the benefits provided for in Section 5 below, unless, in the
case of termination or reduction of such a benefit, (A) there is
substituted a comparable benefit that is economically equivalent to
such benefit prior to its termination or reduction, (B) the termination
or reduction of the benefit affects members of the senior management of
the Company generally or (C) the termination or reduction of the
benefit occurs pursuant to the Executive's direction or consent;
ii. the loss of any of the Executive's titles or positions;
iii. a significant diminution in the Executive's duties and
responsibilities or the assignment to the Executive of duties and
responsibilities inconsistent with his positions;
iv. the relocation of the Executive's principal place of
employment to a location that is more than thirty (30) miles from its
present location; or
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v. the failure of the Company to obtain the unconditional
assumption, in writing or by operation of law, of the Company's
obligation to the Executive under this Agreement by any successor prior
to or at the time of a reorganization, merger, consolidation,
disposition of all or substantially all of the assets of the Company
or similar transaction.
A Constructive Termination Without Cause shall not take effect
unless:
vi. the Executive has delivered written notice to the
Board within ninety days after he acquires knowledge of one of the
events providing a basis for Constructive Termination Without Cause,
stating which one of those events has occurred;
vii. within 30 days after the receipt of such notice the
Company has not remedied such event and provided him with a written
notice of such remedy; and
viii. if the Company has not remedied such event, the
Executive has notified the Company in writing that he is terminating
his employment.
The failure of the Executive to effect a Constructive Termination
Without Cause as to any one event shall not affect his entitlement to effect
a Constructive Termination Without Cause as to any other such event.
f. "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended from time to time, and reference to any specific provisions of the
Exchange Act shall refer to the corresponding provisions of the Act as it may
hereafter be amended or replaced.
g. "TERMINATION WITHOUT CAUSE" shall mean a termination of the
Executive's employment by the Company other than due to Death, Disability or
for Cause.
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2. TERM OF EMPLOYMENT, POSITIONS AND DUTIES.
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Subject to the terms and provisions of this Agreement, the Executive's
employment by the Company may be terminated by either party at any time, with
or without cause, upon notice to the other party. While employed by the
Company, the Executive shall devote his entire business time and all reasonable
efforts to his employment and shall perform such duties as are consistent with
the Executive's position with the Company and as are from time to time assigned
or delegated by the Board and as are set forth in the Company's By-laws.
3. BASE SALARY.
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During his employment with the Company, the Executive shall receive a
Base Salary as shall be determined by the Board from time to time.
The Executive shall be entitled to participate in bonus plans that are
generally made available to senior executives of the Company.
4. ANNUAL BONUSES.
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The Executive shall be eligible to receive such bonuses during his
employment as may be determined by the Board from time to time.
5. EXPENSE REIMBURSEMENT.
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During his employment with the Company, the Executive shall be entitled
to prompt reimbursement by the Company for all reasonable out-of- pocket
expenses incurred by him in performing services under this Agreement, upon his
submission of such accounts and records as may be required under Company
policy.
6. EMPLOYEE BENEFIT PLANS.
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While employed by the Company, the Executive shall be entitled to
participate in all employee benefit plans and programs made available to the
Company's senior executives or to its employees generally, as such plans or
programs may be in effect from time to time.
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7. TERMINATION OF EMPLOYMENT.
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a. TERMINATION BY THE COMPANY FOR CAUSE. In the event that the
Executive's employment is terminated for Cause, he shall be entitled to:
i. his Base Salary through the date of his termination for
Cause;
ii. any annual bonuses earned for prior years but not yet
paid;
iii. reimbursement in accordance with this Agreement of any
business expenses incurred by the Executive but not yet paid to him on
the date of his termination of employment; and
iv. other benefits accrued and earned by the Executive
through the date of termination in accordance with applicable plans
and programs of the Company.
b. TERMINATION WITHOUT CAUSE. In the event of a Termination Without
Cause, the Executive shall be entitled to:
i. his Base Salary, at the rate in effect on the date of his
termination of employment, for a period of twelve months from such
termination, payable in installments in accordance with past
practices;
ii. any annual bonuses earned for prior periods but not yet
paid;
iii. any annual bonus to which the Executive would have been
entitled, had he not been terminated, for the fiscal year during which
he is terminated, which bonus payment shall be made 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. Such bonus
shall be payable when bonuses pursuant to the bonus plan under which it
is earned are paid;
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iv. reimbursement in accordance with this Agreement of any
business expenses incurred by the Executive but not yet paid to him on
the date of his termination of employment; and
v. other benefits accrued and earned by the Executive
through the date of termination in accordance with applicable plans
and programs of the Company.
c. TERMINATION WITHOUT CAUSE OR CONSTRUCTIVE TERMINATION WITHOUT CAUSE
FOLLOWING A CHANGE IN CONTROL. In the event of a Termination Without Cause or
a Constructive Termination Without Cause, in each case, within one year
following a Change in Control, the Executive shall be entitled to:
i. a lump-sum payment equal to two times his Base Salary, at
the rate in effect on the date of his termination of employment;
ii. any annual bonuses earned for prior periods but not yet
paid;
iii. any annual bonus to which the Executive would have been
entitled, had he not been terminated, for the fiscal year during which
he is terminated, which bonus payment shall be made 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. Such bonus
shall be payable when bonuses pursuant to the bonus plan under which it
is earned are paid;
iv. reimbursement in accordance with this Agreement of any
business expenses incurred by the Executive but not yet paid to him on
the date of his termination of employment; and
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v. other benefits accrued and earned by the Executive
through the date of termination in accordance with applicable plans
and programs of the Company.
d. TIMING OF PAYMENT. Except as otherwise expressly provided in this
Section 7, all payments required to be made to the Executive under this Section
7 shall be made no later than 30 days following the date of termination of
employment.
8. WITHHOLDING TAXES.
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All payments to the Executive or his estate or beneficiaries, as the
case may be, shall be subject to withholding on account of federal, state and
local taxes as required by law. If any payment hereunder is insufficient to
provide the amount of such taxes required to be withheld, the Company may
withhold such taxes from any other payment due hereunder.
9. ASSIGNABILITY; BINDING NATURE.
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This Agreement shall be binding upon and inure to the benefit of the
Company and the Executive and their respective successors, heirs (in the case
of the Executive) and assigns. No rights or obligations of the Company under
this Agreement may be assigned or transferred by the Company except that such
rights or obligations may be assigned or transferred pursuant to (i) a merger
or consolidation in which the Company is not the continuing entity or (ii) sale
or liquidation of all or substantially all of the assets of the Company,
provided that the assignee or transferee is the successor to all or
substantially all of the assets of the Company and such assignee or transferee
assumes the liabilities, obligations and duties of the Company, as contained in
this Agreement, either contractually or as a matter of law. The Company
further agrees that, in the event of a sale of assets or liquidation as
described in the preceding sentence, it will use its best efforts to cause such
assignee or transferee expressly to assume the liabilities, obligations
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and duties of the Company hereunder. No obligations of the Executive under
this Agreement may be assigned or transferred by the Executive.
10. ENTIRE AGREEMENT.
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Except to the extent otherwise provided herein, this Agreement contains
the entire understanding and agreement between the parties concerning the
subject matter hereof and supersedes any prior agreements, whether written or
oral, between the parties concerning the subject matter hereof.
11. AMENDMENT OR WAIVER.
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No provision in this Agreement may be amended unless such amendment is
agreed to in writing and signed by both the Executive and an authorized officer
of the Company. No waiver by either party of any breach by the other party of
any condition or provision contained in this Agreement to be performed by such
other party shall be deemed a waiver of a similar or dissimilar condition or
provision at the same or any prior or subsequent time. Any waiver must be in
writing and signed by the Executive or an authorized officer of the Company, as
the case may be.
12. SEVERABILITY.
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In the event that any provision or portion of this Agreement shall be
determined to be invalid or unenforceable for any reason, in whole or in part,
the remaining provisions of this Agreement shall be unaffected thereby and
shall remain in full force and effect to the fullest extent permitted by law.
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13. SURVIVORSHIP.
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The respective rights and obligations of the parties hereunder shall
survive any termination of the Executive's employment with the Company to the
extent necessary to the intended preservation of such rights and obligations as
described in this Agreement.
14. BENEFICIARIES/REFERENCES.
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The Executive shall be entitled to select (and change, to the extent
permitted under any applicable law) a beneficiary or beneficiaries to receive
any compensation or benefit payable hereunder following the Executive's Death
by giving the Company written notice thereof. In the event of the Executive's
Death or of a judicial determination of his incompetence, reference in this
Agreement to the Executive shall be deemed, as appropriate, to refer to his
beneficiary, estate or other legal representative.
15. GOVERNING LAW/JURISDICTION.
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This Agreement shall be governed by and construed and interpreted in
accordance with the laws of Ohio, without reference to principles of conflict
of laws.
IN WITNESS WHEREOF, the parties have duly executed this Agreement on
the date first above written.
/s/ Xxxx X. Xxxxx
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Xxxx X. Xxxxx
SUDBURY, INC.
By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
Chairman, Chief Executive
Officer and President
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