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Exhibit 10.33
AMENDMENT NO. 1 TO
XXXXXX CORPORATION EQUITY AWARD AGREEMENTS
THIS AMENDMENT NO. 1, dated as of September 17, 1997 (the "Amendment"), by and
between Xxxxxx Corporation, a Delaware corporation (the "Company"), and Xxx X.
Xxxxxx (the "Participant"), amends (i) the Xxxxxx Corporation Equity Award
Agreement (the "First Agreement"), dated as of May 20, 1996, by and between the
Company and the Participant, (ii) the Xxxxxx Corporation Equity Award Agreement
(the "Second Agreement"), dated as of January 17, 1997, by and between the
Company and the Participant, and (iii) the Xxxxxx Corporation Equity Award
Agreement (the "Third Agreement"), dated as of May 1, 1997, by and between the
Company and the Participant, (the First, Second and Third Agreements being
hereinafter referred to collectively as the "Agreements").
RECITALS:
WHEREAS, the Corporation has previously adopted the USMIC Corporation 1992
Long-Term Stock Incentive Plan and has amended and restated such Plan as of
November 1, 1995 as the Xxxxxx Corporation 1992 Long-Term Stock Incentive Plan
(the "Plan"), which Plan is incorporated herein by reference and made a part of
the Agreements and this Amendment; and
WHEREAS, pursuant to the Plan and the Agreements the Company has previously
granted the Options (as defined below) and Share Grants (as defined below) to
the Participant as an inducement to enter into and remain in the employment of
the Company's wholly-owned subsidiary, Xxxxxx Guaranty Corporation ("Xxxxxx")
and as an increased incentive to contribute to the Company's further success and
prosperity; and
WHEREAS, the Participant is a senior executive of Xxxxxx 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 certain of its senior executives, including the Participant,
applicable in the event of a Change in Control;
WHEREAS, the Company wishes to ensure that its senior executives are not
practically disabled from discharging their duties in respect of a proposed or
actual transaction involving a Change in Control; and
WHEREAS, the Company desires to provide additional inducement for the
Participant to continue to remain in the ongoing employ of Xxxxxx;
NOW, THEREFORE, the Company and the Participant agree that the Agreement shall
be amended as follows:
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Capitalized terms not otherwise defined herein shall have the same meanings
specified in the Agreement, and capitalized terms not otherwise defined herein
or in the Agreements shall have the meanings specified in the Plan.
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) "Board" means the Board of Directors of the Company.
(b) "Change in Control" means the occurrence during the Term of
any of the following events:
(i) The Company is merged, consolidated or reorganized
into or with another corporation or other legal
person, and as a result of such merger, consolidation
or reorganization less than a majority of the
combined voting power of the then-outstanding Voting
Stock of such corporation or person immediately after
such transaction are held in the aggregate by the
holders of Voting Stock of the Company immediately
prior to such transaction; or
(ii) The Company sells or otherwise transfers all or
substantially all of its assets to another
corporation or other legal person, and as a result of
such sale or transfer less than a majority of the
combined voting power of the then-outstanding Voting
Stock of such corporation or person immediately after
such sale or transfer is held in the aggregate by the
holders of Voting Stock of the Company immediately
prior to such sale or transfer; or
(iii) There is a report filed on Schedule 13D or Schedule
14D-1 (or any successor schedule, form or report),
each as promulgated pursuant to the Exchange Act,
disclosing that any person (as the term "person" is
used in Section 13(d)(3) or Section 14(d)(2) of the
Exchange Act, but not including any Original
Investor) has become the beneficial owner (as the
term "beneficial owner" is defined under Rule 13d-3
or any successor rule or regulation promulgated under
the Exchange Act) of securities representing 25% or
more of the combined voting power of the
then-outstanding Voting Stock of the Company.
Notwithstanding the foregoing provisions of Section 1(b)(iii),
unless otherwise determined in a specific case by majority
vote of the Board, a "Change in Control" shall not be deemed
to have occurred for purposes of Section 1(b)(iii) solely
because (A) the Company, (B) a Subsidiary, or (C) any
Company-sponsored employee stock ownership plan or any other
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employee benefit plan of the Company or any Subsidiary either
files or becomes obligated to file a report or a proxy
statement under or in response to Schedule 13D, Schedule
14D-1, Form 8-K or Schedule 14A (or any successor schedule,
form or report or item therein) under the Exchange Act
disclosing beneficial ownership by it of shares of Voting
Stock, whether in excess of 25% or otherwise, or because the
Company reports that a change in control of the Company has
occurred or will occur in the future by reason of such
beneficial ownership.
(c) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(d) "Options" means (i) the Option (as defined in the First
Agreement) granted under the First Agreement, (ii) the Option
(as defined in the Second Agreement) granted under the Second
Agreement, and (iii) the Option (as defined in the Third
Agreement) granted under the Third Agreement.
(e) "Original Investor" means any of the five institutional
investors which owned any capital stock of the Company as of
November 1, 1995.
(f) "Share Grants" means (i) the Share Grant (as defined in the
First Agreement) granted under the First Agreement and (ii)
the Share Grant (as defined in the Second Agreement) granted
under the Second Agreement.
(g) "Subsidiary" means an entity in which the Company directly or
indirectly beneficially owns 50% or more of the outstanding
Voting Stock.
(h) "Term" means the period commencing as of the date hereof and
expiring as of the later of (i) the close of business on
December 31, 2002, or (ii) the expiration of the Coverage
Period; provided, however, that (A) commencing on January 1,
2002 and each January 1 thereafter, the term of this Agreement
will automatically be extended for an additional year unless,
not later than September 30 of the immediately preceding year,
the Company or the Executive shall have given notice that it
or the Executive, as the case may be, does not wish to have
the Term extended and (B) subject to the last sentence of
Section 5, if, prior to a Change in Control, the Executive
ceases for any reason to be an employee of the Company and any
Subsidiary, thereupon without further action the Term shall be
deemed to have expired and this Agreement will immediately
terminate and be of no further effect. For purposes of this
Section 1(g), the Executive shall not be deemed to have ceased
to be an employee of the Company and any Subsidiary by reason
of the transfer of Executive's employment between the Company
and any Subsidiary, or among any Subsidiaries.
(i) "Voting Stock" means securities entitled to vote generally in
the election of directors.
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2. Operation of Agreement. This Agreement will be effective and binding
immediately upon its execution, but, anything in this Agreement to the
contrary notwithstanding, this Agreement will not be operative unless
and until a Change in Control occurs. Upon the occurrence of a Change
in Control at any time during the Term, without further action, this
Agreement shall become immediately operative.
3. Acceleration of Vesting and Lapse of Restrictions on Transfer.
(a) Following the occurrence of a Change in Control, any portion
of the Options not otherwise exercisable as of the date of
such Change in Control shall become immediately exercisable,
and any restrictions on transfer imposed by the Agreements
with respect to the Share Grants and in effect on the date of
such Change in Control shall immediately lapse as of the date
of such Change in Control; provided, however, that this
Section 3(a) shall be of no force and effect if such
acceleration of exercisability would cause the Company to be
unable to use the pooling of interests method of accounting in
connection with the transactions resulting in such Change in
Control.
(b) Notwithstanding any provision of this Agreement to the
contrary, the parties' respective rights and obligations under
this Section 3 and under Section 4 will survive any
termination or expiration of this Agreement or the termination
of the Participant's employment following a Change in Control
for any reason whatsoever.
4. Legal Fees and Expenses. It is the intent of the Company that the
Participant not be required to incur legal fees and the related
expenses associated with the interpretation, enforcement or defense of
Participant's rights under this Agreement by litigation or otherwise
because the cost and expense thereof would substantially detract from
the benefits intended to be extended to the Participant hereunder.
Accordingly, if it should appear to the Participant that the Company
has failed to comply with any of its obligations under this Agreement
or in the event that the Company or any other person takes or threatens
to take any action to declare this Agreement void or unenforceable, or
institutes any litigation or other action or proceeding designed to
deny, or to recover from, the Participant the benefits provided or
intended to be provided to the Participant hereunder, the Company
irrevocably authorizes the Participant from time to time to retain
counsel of Participant's choice, at the expense of the Company as
hereafter provided, to advise and represent the Participant in
connection with any such interpretation, enforcement or defense,
including without limitation the initiation or defense of any
litigation or other legal action, whether by or against the Company or
any Director, officer, stockholder or other person affiliated with the
Company, in any jurisdiction. Notwithstanding any existing or prior
attorney-client relationship between the Company and such counsel, the
Company irrevocably consents to the Participant's entering into an
attorney-client relationship with such counsel, and in that
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connection the Company and the Participant agree that a confidential
relationship shall exist between the Participant and such counsel.
Without respect to whether the Participant prevails, in whole or in
part, in connection with any of the foregoing, the Company will pay and
be solely financially responsible for any and all attorneys' and
related fees and expenses incurred by the Participant in connection
with any of the foregoing.
5. Employment Rights. Nothing expressed or implied in this Agreement will
create any right or duty on the part of the Company or the Participant
to have the Participant remain in the employment of the Company or any
Subsidiary prior to or following any Change in Control. Any termination
of employment of the Participant or the removal of the Participant from
the office or position in the Company or any Subsidiary following the
commencement of any discussion with a third person that ultimately
results in a Change in Control shall be deemed to be a termination or
removal of the Participant after a Change in Control for purposes of
this Agreement.
6. Withholding of Taxes. The Company may withhold from any amounts payable
under this Agreement all federal, state, city or other taxes as the
Company is required to withhold pursuant to any law or government
regulation or ruling.
7. 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
satisfactory to the Participant, 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 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 Participant'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
7(a) and 7(b). Without limiting the generality or effect of
the foregoing, the Participant's rights hereunder will not be
assignable,
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transferable or delegable, whether by pledge, creation of a
security interest, or otherwise, other than by a transfer by
Participant's will or by the laws of descent and distribution
and, in the event of any attempted assignment or transfer
contrary to this Section 7(c), the Company shall have no
liability to pay any amount so attempted to be assigned,
transferred or delegated.
8. 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 Federal Express, UPS, or
Purolator, addressed to the Company (to the attention of the Secretary
of the Company) at its principal executive office and to the
Participant at his 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.
9. Governing Law. The validity, interpretation, construction and
performance of this Agreement will be governed by and construed in
accordance with the substantive laws of the State of Illinois, without
giving effect to the principles of conflict of laws of such State.
10. 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.
11. 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 Participant 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. 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.
12. Application of Agreement. Except as expressly amended pursuant to this
Amendment No. 1, all terms of the Agreements remain in full force and
effect.
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13. Counterparts. This Amendment No. 1 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 Corporation, by its duly authorized officer, and the
Participant, have executed this Amendment No. 1 either together or in the form
of multiple counterparts hereof (each of which shall be deemed an original)
effective as of the date and year first above written.
XXXXXX CORPORATION
By: /s/ Xxxxxxxx X. Xxxxxx XX
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Senior Vice President
XXX X. XXXXXX
/s/ Xxx X. Xxxxxx
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