Exhibit 10.13
CHANGE IN CONTROL AGREEMENT
THIS CHANGE IN CONTROL AGREEMENT (this "Agreement"), dated as of
October 14, 1999, is made by and between The Xxxxxx Companies, Inc., a Delaware
corporation (the "Company"), and Xxxxx X. Xxxxxxx ("Executive").
WITNESSETH:
WHEREAS, Executive is a senior executive of the Company and has made
and is expected to continue to make major contributions to the short- and
long-term profitability, growth and financial strength of the Company;
WHEREAS, the Company recognizes that, as is the case for most publicly
held companies, the possibility of a Change in Control (as defined below)
exists;
WHEREAS, the Company desires to assure itself of both present and
future continuity of management and desires to establish certain minimum
severance benefits for Executive, applicable in the event of a Change in
Control;
WHEREAS, the Company wishes to ensure that Executive is not practically
disabled from discharging her duties in respect of a proposed or actual
transaction involving a Change in Control;
WHEREAS, the Company desires to provide additional inducement for the
Executive to continue to remain in the employ of the Company; and
WHEREAS, on May 19, 1999 the Compensation Committee of the Board (as
defined below) authorized the Company to enter into this Agreement.
NOW, THEREFORE, the Company and Executive agree as follows:
1. Certain Defined Terms. In addition to terms defined elsewhere
herein, the following terms have the following meanings when used in this
Agreement with initial capital letters:
(a) "Base Pay" means Executive's annual base salary rate as in effect
from time to time.
(b) "Board" means the Board of Directors of the Company.
(c) "Cause" means gross misconduct injurious to the Company, as
determined in a written opinion rendered to the Board by the Company's outside
counsel, and which has not been remedied (to the fullest extent possible) by the
Executive within ten days after written notice thereof to Executive by the
Board.
Notwithstanding the foregoing, Executive shall not be deemed to have been
terminated for "Cause" hereunder unless and until there shall have been
delivered to the Executive a copy of a resolution duly adopted by the
affirmative vote of not less than two-thirds of the Board then in office at a
meeting of the Board called and held for such purpose, after reasonable notice
to the Executive and an opportunity for the Executive, together with the
Executive's counsel (if the Executive chooses to have counsel present at such
meeting), to be heard before the Board, finding that, in the good faith opinion
of the Board, the Executive had committed an act constituting "Cause" and
specifying the particulars thereof in detail. Nothing herein will limit the
right of the Executive or his beneficiaries to contest the validity or propriety
of any such determination.
(d) "Change in Control" means the occurrence during the Term of any of
the following events:
(i) The acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a
"Person") of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 50% or more of the combined
voting power of the then outstanding Voting Stock of the Company; or
(ii) consummation of a reorganization, merger or consolidation, a
sale or other disposition of all or substantially all of the assets of
the Company, or other transaction (each, a "Business Combination"),
unless, in each case, immediately following such Business Combination,
(A) all or substantially all of the individuals and entities who were
the beneficial owners of Voting Stock of the Company immediately prior
to such Business Combination beneficially own, directly or indirectly,
more than 50% of the combined voting power of the then outstanding
shares of Voting Stock of the entity resulting from such Business
Combination (including, without limitation, an entity which as a result
of such transaction owns the Company or all or substantially all of the
Company's assets either directly or through one or more subsidiaries)
in substantially the same proportions relative to each other as their
ownership, immediately prior to such Business Combination, of the
Voting Stock of the Company and (B) no Person beneficially owns,
directly or indirectly, 50% or more of the combined voting power of the
then outstanding shares of Voting Stock of the entity resulting from
such Business Combination.
(e) "Employee Benefits" means any life, disability, group health and
dental benefit plans; provided, however, that Employee Benefits shall not
include contributions made by the Company to any retirement plan, pension plan
or profit sharing plan for the benefit of the Executive in connection with
amounts earned by the Executive.
(f) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(g) "Subsidiary" means an entity in which the Company directly or
indirectly beneficially owns 50% or more of the outstanding Voting Stock.
(h) "Voting Stock" means securities entitled to vote generally in the
election of directors.
2. Termination Following a Change in Control.
In the event that in the 90 day period following the consummation of a
Change in Control, the employment of Executive is terminated by the Company for
any reason other than Cause or by Executive for any reason then the Company
shall,
(a) on the first day of each of the twelve months following the date of
such termination, pay to Executive one-twelfth of the amount of Executive's
annual Base Pay as in effect immediately prior to such termination (less
applicable withholding), and
(b) for the one year period following such termination, continue to
provide to Executive all Employee Benefits which were received by, or with
respect to, Executive as of the date of such termination, at no additional
expense to Executive.
3. Successors and Binding Agreement.
(a) The Company will require any successor (whether direct or indirect,
by purchase, merger, consolidation, reorganization or otherwise) to all or
substantially all of the business or assets of the Company, by agreement in form
and substance reasonably satisfactory to the Executive, expressly to assume and
agree to perform this Agreement in the same manner and to the same extent the
Company would be required to perform if no such succession had taken place. This
Agreement will be binding upon and inure to the benefit of the Company and any
successor to the Company, including without limitation any
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persons acquiring directly or indirectly all or substantially all of the
business or assets of the Company whether by purchase, merger, consolidation,
reorganization or otherwise (and such successor shall thereafter be deemed the
"Company" for the purposes of this Agreement), but will not otherwise be
assignable, transferable or delegable by the Company.
(b) This Agreement will inure to the benefit of and be enforceable by
the Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees and legatees.
(c) This Agreement is personal in nature and neither of the parties
hereto shall, without the consent of the other, assign, transfer or delegate
this Agreement or any rights or obligations hereunder except as expressly
provided in Sections 3(a) and 3(b). Without limiting the generality or effect of
the foregoing, the Executive's right to receive payments hereunder will not be
assignable, transferable or delegable, whether by pledge, creation of a security
interest, or otherwise, other than by a transfer by Executive's will or by the
laws of descent and distribution and, in the event of any attempted assignment
or transfer contrary to this Section 3(c), the Company shall have no liability
to pay any amount so attempted to be assigned, transferred or delegated.
4. Notices. For all purposes of this Agreement, all communications,
including without limitation notices, consents, requests or approvals, required
or permitted to be given hereunder will be in writing and will be deemed to have
been duly given when hand delivered or dispatched by electronic facsimile
transmission (with receipt thereof orally confirmed), or five business days
after having been mailed by United States registered or certified mail, return
receipt requested, postage prepaid, or three business days after having been
sent by a nationally recognized overnight courier service such as FedEx, UPS, or
DHL, addressed to the Company (to the attention of the Secretary of the Company)
at its principal executive office and to the Executive at her principal
residence, or to such other address as any party may have furnished to the other
in writing and in accordance herewith, except that notices of changes of address
shall be effective only upon receipt.
5. Validity. If any provision of this Agreement or the application of
any provision hereof to any person or circumstances is held invalid,
unenforceable or otherwise illegal, the remainder of this Agreement and the
application of such provision to any other person or circumstances will not be
affected, and the provision so held to be invalid, unenforceable or otherwise
illegal will be reformed to the extent (and only to the extent) necessary to
make it enforceable, valid or legal.
6. Arbitration; Governing Law. Any dispute between the parties under
this Agreement shall be resolved (except as provided below) in Pleasanton,
California through informal arbitration by an arbitrator selected under the
rules of the American Arbitration Association and the arbitration shall be
conducted in that location under the rules of said Association. The arbitrator
shall have the right only to interpret and apply the provisions of this
Agreement and may not change its provisions. The arbitrator shall permit
reasonable pre-hearing discovery of facts, to the extent necessary to establish
a claim or a defense to a claim, subject to supervision by the arbitrator. The
determination of the arbitrator shall be conclusive and binding upon the parties
and judgment upon the same may be entered in any court having jurisdiction
thereof. The arbitrator shall give written notice to the parties stating his or
their determination and shall furnish to each party a signed copy of such
determination. The expense of arbitration shall be borne equally by the
Executive and the Company or as the arbitrator shall otherwise equitably
determine.
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7. Miscellaneous. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing signed by the Executive and the Company. No waiver by either party
hereto at any time of any breach by the other party hereto or compliance with
any condition or provision of this Agreement to be performed by such other party
will be deemed a waiver of similar or dissimilar provisions or conditions at the
same or at any prior or subsequent time. This Agreement constitutes the entire
agreement of the parties with respect to the subject matter hereof and
supersedes any and all prior agreements of the parties with respect to such
subject matter. No agreements or representations, oral or otherwise, expressed
or implied with respect to the subject matter hereof have been made by either
party which are not set forth expressly in this Agreement. References to
Sections are to references to Sections of this Agreement.
8. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the date first above written.
THE XXXXXX COMPANIES, INC.
/s/ Xxxxxx X. Xxxxx
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By: Xxxxxx X. Xxxxx
Title: Executive Vice President & CFO
Executive:
/s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
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