EMPLOYMENT AGREEMENT WITH XXXXXXX X. XXXXXXXX
Parties:
RHI HOLDINGS, INC. ("RHI") and XXXXXXX X. XXXXXXXX. All references
to "you" shall mean Xxxxxxx X. Xxxxxxxx.
Position:
Your position will be President of Xxxxxxxxx'x Advanced Technologies
Division, reporting directly to the Chief Operating Officer of The Xxxxxxxxx
Corporation ("Fairchild").
Compensation:
Your base salary ("base salary") will be at a rate not less than $100,000 per
year, payable bi-weekly in accordance with Xxxxxxxxx'x usual payroll policies.
Commencing as of July 1, 1994, but prorated from September 1, 1994
through June 30, 1995, you will be eligible to participate in Xxxxxxxxx'x
Executive Incentive Compensation Plan, and to receive additional
compensation ("incentive bonus") at a factor of 50% of your base salary, as
the same shall be established from time to time; provided, however, any
incentive bonus to which you may from time to time be or become entitled,
shall be computed as if your base salary were the greater of $190,000, or
$190,000 plus an amount equal to any increase in your actual base salary
on a dollar for dollar basis.
Your base salary will be reviewed annually by the Fairchild Compensation
and Stock Option Committee (the "Compensation Committee"), and
adjustments, if any, to your base salary will be at the discretion of the Board
of Directors.
Stock Options:
A recommendation shall be made to the Compensation Committee and to
Xxxxxxxxx'x board of Directors for an initial award to you of an option to
acquire up to 25,000 shares of Class A Common Stock of Fairchild, in
accordance with the 1986 Non-Qualified and Incentive Stock Option Plan of
Fairchild, as amended. This plan, provides, inter alia, for vesting of 25% of
the shares subject to the option, on the first anniversary of the award, and
for vesting of an additional 25% of the original number of shares subject to
the option, on each anniversary thereafter.
Automotive Allowance:
You will be eligible to participate in the Xxxxxxxxx Executive Automobile
Ownership Plan at a reimbursement rate ($650 per month) equal to that of
other senior officers of Fairchild, other than the CEO.
Other Benefits:
You will be eligible to participate in all Fairchild employee benefit plans but
only to the extent that you do not receive comparable benefits under your
employment arrangement with Xxxxxxxxx France. Fairchild employee benefits
include Xxxxxxxxx'x Group Health Insurance Plan, Xxxxxxxxx'x Pension Plan,
Xxxxxxxxx'x Long Term Disability Plan, and Xxxxxxxxx'x Savings Plan (401(k)),
and to receive Fairchild paid group life insurance (up to three times base
salary).
Physical Examination:
You will be entitled to go the Greenbriar Clinic for an annual physical
examination at Fairchild expense.
Vacation:
You will be entitled to four weeks vacation per year, in accordance with the
Fairchild vacation policy.
Change of Control:
As a senior office of Fairchild, you will be covered by a "Change in Control"
provision including the same "triggers", and at the same level as other
senior officers of Fairchild, other than the CEO. Any benefits available to
you under such provision shall be computed as if your base salary were the
greater of $190,000, or $190,000 plus an amount equal to any increase in
your actual base salary on a dollar for dollar basis.
Term:
The initial term of your employment shall commence as of September 1,
1994.
Termination:
If your employment shall be terminated for any reason other than Cause (as
defined below), you shall be entitled to receive as severance the standard
and customary severance package paid by Fairchild to senior officers
employed for a similar time period as you were employed by Fairchild.
Duties:
As President of Xxxxxxxxx'x Advanced Technologies Division, you shall
perform such reasonable duties with respect to Fairchild Convac GmbH, the
activities of Xxxxxxxxx France in countries other than France, Compagnie
pour le Developpment Industrial ("CDI"), Xxxxxxxxx'x Advanced Technologies
Division and any current or future business ventures of Fairchild in the
semiconductor equipment industry or any other high technology enterprise
as you shall be directed to perform, by the Chief Operating Officer and the
Board of Directors. You acknowledge that your office will require your full-
time efforts and attention, and that you shall not, during the term of your
employment, engage in any other business activity, whether or not such
other business activity is for your own behalf or for any other person, firm,
corporation or other entity (together, a "Person") and whether or not such
other Person is in competition with Fairchild. Notwithstanding the foregoing,
you shall be allowed to manage and oversee passive investments in
noncompeting businesses, provided that such management and oversight
does not interfere with the performance of your duties for Fairchild.
Confidentiality:
You shall enter into a Confidentiality Agreement and an Agreement to
Assign to Fairchild inventions and designs, whether patentable or not,
conceived or improved by you during your employment by Fairchild or any
affiliate.
Non Competition:
You agree that for a period of 2 years after the expiration or termination of
your employment by RHI, you shall not, except with the prior written
consent of Fairchild, engage in, be employed by or in any way advise or act
for, or have any financial interest in any business that is a competitor of
Xxxxxxxxx'x Advanced Technologies Division or any of the companies within
such division, all as may be determined by the Board of Directors of
Fairchild. Notwithstanding the foregoing, if you purchase from Fairchild all
of Xxxxxxxxx'x interest in CDI under the terms of the Stock Repurchase
Agreement dated the date hereof, between Fairchild, you and certain
others, you may be employed by CDI so long as CDI does not compete
with any of the companies within the Fairchild Advanced Technologies
Division. Moreover, the ownership of 5% or less of the outstanding voting
or other securities of any corporation whose shares are listed on a
recognized stock exchange or traded in an over the counter market, even
though such corporation may be a competitor of Fairchild Advanced
Technologies Division or any of the companies within such division, shall
not be deemed as constituting a financial interest in such competitor.
Moreover, you agree that for a period of 2 years after the expiration of the
termination of your employment by RHI, you shall not take any action or
assist any successor employer or any other entity in recruiting any
employee who had worked for any company in the Fairchild Advanced
Technologies Division (a "Co-Worker") nor shall you in any way solicit, or
cause to be solicited any Co-Worker to leave the employment of Fairchild
or its Advanced Technologies Division. This includes (a) identifying to your
successor employer or such entity any Co-Worker who has special
knowledge concerning Xxxxxxxxx'x inventions, processes, methods,
suppliers, customers or confidential affairs or (b) commenting to your
successor employer or its agents or such other entity that the quantity of
work, quality of work, special knowledge or personal characteristics of any
Co-Worker. You also agree that you will not provide such information to
any prospective employer during an interview preceding possible
employment. You understand that establishing the precise amount of
damages for breach of this provision might be difficult. For that reason, you
agree that if you should be found to have breached this provision, for each
Co-Worker about whom you have provided information in violation of this
provision, liquidated damages for such violation shall be in the amount of
the annual salary of that Co-Worker at Fairchild. You understand that the
covenants contained in this paragraph shall be deemed to be a series of
separate covenants, one for each line of business for Fairchild Advanced
Technologies Division. You agree that the character, duration and
geographical scope of this covenant not to compete is reasonable in light
of the circumstances as they exist as of the date of this Agreement.
However, should a determination nonetheless be made by a court of
competent jurisdiction that the character, duration or geographical scope of
this covenant not to compete is unreasonable in light of the circumstances
as they then exist, then it is your intention and agreement that this covenant
not to compete shall be construed by the court in such a manner as to
impose only those restrictions on your conduct that are reasonable in light
of the circumstances as they then exist and necessary to insure Fairchild
the intended benefits of this covenant not to compete. If, in any judicial
proceeding, a court refuses to enforce all of the separate covenants
deemed included herein because, taken together they are more extensive
then necessary to insure Fairchild of the intended benefit of this covenant
not to compete, you understand and agree that those of such covenants
which, if eliminated, would permit the remaining separate covenants to be
enforced in such proceeding shall, for the purpose of such proceeding be
deemed eliminated from this section.
Cause:
Your employment may be terminated at any time for Cause, which shall
include (i) conduct, at any time, which has involved criminal dishonesty,
conviction of any felony, or conviction of any lesser crime or offense
involving the property of Fairchild, or any of its affiliates, significant
conflict of interest, serious impropriety, or breach of corporate duty,
misappropriation of any money or other assets or properties of Fairchild, or
that of its subsidiaries or affiliates, (ii) willful violation of specific and
lawful directions form the Xxxxxxxxx'x Chief Operating Officer or its Board of
Directors, failure or refusal to perform services customarily performed by a
person in your office, or as otherwise as specifically required by agreement,
or willful misconduct or gross negligence in connection with the
performance of your duties, (iii) chronic alcoholism or drug addiction, and
(iv) any other acts or conduct inconsistent with the standards of loyalty,
integrity or care reasonably required by Fairchild of its senior management.
Location:
You understand that your obligations under this employment arrangement
will require you to spend considerable time in Germany and the United
States. You agree to spend such time in Germany and the United States
as is necessary to fully and timely satisfy your duties and obligations as
President of Xxxxxxxxx'x Advanced Technologies Division or as may be
requested by the Chief Operating Officer of Fairchild or the Board of
Directors of Fairchild or RHI.
Conflicting Arrangements:
You represent and warrant to Fairchild that there is no agreement to which
you are a party or under which you are bound which would prohibit your
employment by Fairchild, or which would in any other manner interfere with
the performance by you of your duties for Fairchild, its affiliates and
subsidiaries.
Governing Law:
Our understandings shall be governed by the laws of the Commonwealth
of Virginia, exclusive of its choice of law provisions.
Binding Effect:
This Agreement supersedes all prior negotiations and represents the entire
Agreement of the parties, and our signatures hereon will bind us hereto.
This Agreement binds and inures to the benefit of Fairchild, its successors
and assigns.
Accepted: Accepted:
RHI HOLDINGS, INC.
Xxxxxxx X. Xxxxxxxx Xxxxxx X. Xxxxxx
Vice President
Dated: December 29, 1994 Dated: December 29, 1994
