EMPLOYMENT AGREEMENT
BETWEEN
DENTSPLY INTERNATIONAL INC.
AND
XXXX X. XXXX
THIS AGREEMENT is entered into as of December 1, 2002, by and
between
DENTSPLY International Inc., a Delaware corporation (the
"Company") and Xxxx X. Xxxx, ("Employee").
WHEREAS, it is in the best interest of the Company and Employee
that the terms and conditions of Employee's services be formally
set forth:
NOW, THEREFORE, in consideration of the mutual covenants and
agreements of the parties hereto, it is hereby agreed as follows:
1. Services
1.1 The Company shall employ Employee and Employee accepts
such employment and agrees to serve as Senior Vice President and
Chief Financial Officer of the Company, effective as of the date
stated below, and, if elected thereto, as an officer or director
of any Affiliate, for the term and on the conditions herein set
forth. Employee shall be responsible for the activities and
duties presently associated with these positions. Employee shall
perform such other services not inconsistent with his position as
shall from time to time be assigned to him by the Board of
Directors, the Chief Executive Officer, or the President of the
Company. Employee's services shall be performed at a location
suitable for the performance of the Employee's assigned duties.
1.2 Employee shall at all times devote his full business
time and efforts to the performance of his duties and to promote
the best interests of the Company and its Affiliates.
2. Period of Employment Employment as Senior Vice President
and Chief Financial Officer shall begin and continue from
, 2002, and terminate on the happening of any of the following
events:
2.1 Death The date of death of Employee;
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2.2 Termination by Employee Without Good Reason The date
specified in a written notice of termination given to the Company
by Employee not less than 180 days in advance of such specified
date, at which date the Employee's obligation to perform services
pursuant to this Agreement shall cease.
2.3 Termination by Employee with Good Reason Thirty (30)
days following the date of a written notice of termination given
to the Company by Employee within thirty (30) days after any one
or more of the following events have occurred:
(a) failure by the Company to maintain the duties,
status, and responsibilities of the Employee substantially
consistent with those of Employee's position as of the date
of the Agreement, or
(b) a reduction by the Company in Employee's base
salary as in effect as of the date hereof plus all increases
thereof subsequent thereto; other than any reduction
implemented as part of a formal austerity program approved
by the Board of Directors of the Company and applicable to
all continuing employees of the Company, provided such
reduction does not reduce Employee's salary by a percentage
greater than the average reduction in the compensation of
all employees who continue as employees of the Company
during such austerity program; or
(c) the failure of the Company to maintain and to
continue Employee's participation in the Company's benefit
plans as in effect from time to time on a basis
substantially equivalent to the participation and benefits
of Company employees similarly situated to the Employee; or
(d) any substantial and uncorrected breach of the
Agreement by the Company.
2.4 Termination by the Company Upon written notice of
termination given to Employee by the Company, the Employee's
obligation to perform services pursuant to this Agreement shall
cease as of the date of such notice.
3. Payments by the Company
3.1 During the Period of Employment, the Company shall pay
to the Employee for all services to be performed by Employee
hereunder a salary of not less than $325,000 per annum, or such
larger amount as may from time to time be fixed by the Board of
Directors of the Company or, if applicable, by the Human
Resources Committee of the Board (or its successor), payable in
accordance with the Company's normal pay schedule.
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3.2 During the Period of Employment, Employee shall be
entitled to participate in all plans and other benefits made
available by the Company generally to its domestic executive
employees, including (without limitation) benefits under any
pension, profit sharing, employee stock ownership, stock option,
bonus, performance stock appreciation right, management
incentive, vacation, disability, annuity, or insurance plans or
programs. Any payments to be made to Employee under other
provisions of this Section 3 shall not be diminished by any
payments made or to be made to Employee or his designees pursuant
to any such plan, nor shall any payments to be made to Employee
or his designees pursuant to any such plan be diminished by any
payment made or to be made to Employee under other provisions of
this Section 3.
3.3 Upon termination of the Period of Employment for
whatever reason, Employee shall be entitled to receive the
compensation accrued and unpaid as of the date of his
termination. If Employee at the time of termination is eligible
to participate in any Company incentive or bonus plan then in
effect, Employee shall be entitled to receive a pro-rata share of
such incentive or bonus award based upon the number of days he is
employed during the plan year up to the date of his termination.
Such pro-rata amount shall be calculated in the usual way and
paid at the usual time.
3.4 If the Period of Employment terminates upon the death
of Employee, the Company shall continue payment of his then
current salary for a period of 12 months from the date of death,
together with his pro-rata share of any incentive or bonus
payments due for the period prior to his death, to Employee's
designated beneficiary or, if no beneficiary has been effectively
designated, then to Employee's estate.
3.5 If the Period of Employment is terminated by the
Employee under Section 2.3, or by the Company under Section 2.4,
the Company shall continue to pay compensation and provide
benefits to the employee as provided in this Section 3.5 for a
period (the "Termination Period") beginning on the date of the
termination notice and ending on the earlier of: (i) the second
annual anniversary of the date of such termination notice; or
(ii) the date on which the Employee would attain age 65, as
follows:
(a) Compensation shall be paid to the Employee at the
rate of salary being paid to Employee under Section 3.1
immediately before the termination;
(b) Bonus and incentive compensation shall be paid to
the Employee in accordance with plans approved by the Board
of Directors and similar to those in which the Employee
participated at time of termination, using the same formula
and calculations as if termination had not occurred. The
Employee shall not be entitled to receive any further grants
of stock options under any stock option or similar such plan
subsequent to the date of termination, but outstanding stock
options shall continue to vest during the Termination Period
in accordance with the applicable stock option plan;
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(c) Employee shall receive the benefits that would
have been accrued by the Employee during the Termination
Period from participation by the Employee under any pension,
profit sharing, employee stock ownership plan ("ESOP") or
similar retirement plan or plans of the Company or any
Affiliate in which the Employee participated immediately
before the termination, in accordance with the terms of any
such plan (or, if not available, in lieu thereof be
compensated for such benefits), based on service the
Employee would have had during the Termination Period and
compensation (and, if applicable, bonus and incentive
compensation) as determined under Section (a) (and, if
applicable, Subsection (b) above);
(d) Employee shall receive continued coverage during
the Termination Period under all employee disability,
annuity, insurance, or other employee welfare benefit plans,
programs or arrangements of the Company or any Affiliate in
which Employee participated immediately before the notice of
termination, plus all improvements subsequent thereto (or,
if not available, in lieu thereof be compensated for such
coverage); and
(e) In the event of the death of Employee during the
Termination Period, the Company shall continue to make
payments under Subsection 3.5(a) for the period that is the
lesser of the remainder of the Termination Period or twelve
(12) months, and shall pay any bonuses due under Subsection
3.5(b) on a pro-rata basis until the date of Employee's
death, to Employee's designated beneficiary or, if no
beneficiary has been effectively designated, then to
Employee's estate.
Except as provided in Section 3.6, payment of compensation under
Subsection 3.5(a) above shall be made at the same time as
payments of compensation under Section 3.1, and payments of other
benefits under Subsections 3.5(b) and (c) shall be paid at the
same time and to the same person as compensation or benefits
would have been paid under the plan, program, or arrangement to
which they relate (after taking into account any election made by
the Employee with respect to payments under such plan, program,
or arrangement), and shall be pro-rated for any partial year
through the date of expiration of the Termination Period.
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3.6 If at any time after a Change of Control the Period of
Employment is terminated by the Employee under Section 2.3, or
the Company terminates or gives written notice of termination of
the Period of Employment to the Employee (regardless of whether
in accordance with
Section 2.4), then in lieu of the periodic payment of the amounts
specified in Subsections 3.5(a), (b), and (c) (except as may be
otherwise prohibited by law or by said plans), the Company, at
the written election of Employee, shall pay to Employee within
five (5) business days of such termination or notice of
termination the present value of the amounts specified in
Subsections 3.5(a), (b), and (c), discounted at the greatest rate
of interest then payable by Mellon Bank (or its successor) on any
federally insured savings account into which Employee could
deposit such amount and make immediate withdrawals therefrom
without penalty, and shall provide for the remainder of the
Termination Period, if any, the benefit coverage required by
Subsection 3.5(d). Employee shall not be required to mitigate
damages payable under this Section 3.6.
3.7 In no event will the Company be obligated to continue
Employee's compensation and other benefits under the Agreement
beyond Employee's sixty-fifth (65th) birthday or if Employee's
employment is terminated because of gross negligence or
significant willful misconduct (e.g. conviction of
misappropriation of corporate assets or serious criminal offense).
4. Non-Competition Agreement During the Period of Employment
and for a period of five (5) years after the termination thereof,
Employee shall not, without the written consent of the Company,
directly or indirectly be employed or retained by, or render any
services for, or be financially interested in, any firm or
corporation engaged in any business which is competitive with any
business in which the Company or any of its Affiliates may have
been engaged during the Period of Employment. The foregoing
restriction shall not apply to the purchase by Employee of up to
5% of the outstanding shares of capital stock of any corporation
whose securities are listed on any national securities exchange.
5. Loyalty Commitments During and after the Period of
Employment: (a) Employee shall not disclose any confidential
business information about the affairs of the Company or any of
its Affiliates; and (b) Employee shall not, without the prior
written consent of the Company, induce or attempt to induce any
employee or agency representative of the Company or any Affiliate
to leave the employment or representation of the Company or such
Affiliate.
6. Separability of Provisions The terms of this Agreement
shall be considered to be separable from each other, and in the
event any shall be found to be invalid, it shall not affect the
validity of the remaining terms.
7. Binding Effect This Agreement shall be binding upon and
inure to the benefit of (a) the Company and its successors and
assigns, and (b) Employee, his personal representatives, heirs,
and legatees.
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0. Entire Agreement This Agreement constitutes the entire
agreement between the parties and supersedes and revokes all
prior oral or written understandings between the parties relating
to Employee's employment, except with respect to matters
addressed in the offer letter dated
October , 2002 between the parties to the extent such matters
are not covered in this Agreement. The Agreement may not be
changed orally but only by a written document signed by the party
against whom enforcement of any waiver, change, modification,
extension, or discharge is sought.
9. Definitions The following terms herein shall (unless
otherwise expressly provided) have the following respective
meanings:
9.1 "Affiliate" when used with reference to the Company
means any corporations, joint ventures, or other business
enterprises directly or indirectly controlling, controlled by, or
under common control with the Company. For purposes of this
definition, "control" means ownership or power to vote 50% or
more of the voting stock, venture interests, or other comparable
participation in such business enterprises.
9.2 "Period of Employment" means the period commencing on
the date hereof and terminating pursuant to Section 2.
9.3 "Beneficiary" means the person or persons designated in
writing by Employee to Company.
9.4 "Change of Control" means any event by which (i) an
Acquiring Person has become such, or (ii) Continuing Directors
cease to comprise a majority of the members of the Board of
Directors of the Company or the applicable Parent of the Company
(a "Board"). For purposes of this definition:
(a) An "Acquiring Person" means any person or group
(as defined in Section 13(d)(3) of the Securities Exchange
Act of 1934, as amended, and the rules and regulations
promulgated thereunder as in effect on the date of this
Agreement (the "Exchange Act") who or which, together with
all affiliates and associates (as defined in Rule 12B-2
under the Exchange Act) becomes, by way of any transaction,
the beneficial owner of shares of the Company, or such
Parent, having 20% or more of (i) the then outstanding
shares of Common Stock of the Company, or such Parent, or
(ii) the voting power of the then outstanding voting
securities of the Company, or such Parent, entitled to vote
generally in the election of directors of the Company or
such Parent; and
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(b) "Continuing Director" means any member of a Board,
while such person is a member of such Board who is not an
Acquiring Person, or an affiliate or associate of an
Acquiring Person or a representative of an Acquiring Person
or of any such affiliate or associate and who (i) was a
member of such Board prior to the date of this Agreement, or
(ii) subsequently becomes a member of such Board and whose
nomination for election or election to such Board is
recommended or approved by resolution of a majority of the
Continuing Directors or who is included as a nominee in a
proxy statement of the Company or the applicable Parent
distributed when a majority of such Board consists of
Continuing Directors.
9.5 "Parent" means any Affiliate directly or indirectly
controlling (within the meaning of Section 9.1) the Company.
10. Notices Where there is provision herein for the delivery of
written notice to either of the parties, such notice shall be
deemed to have been delivered for the purposes of this Agreement
when delivered in person or placed in a sealed, postpaid envelope
addressed to such party and mailed by registered mail, return
receipt requested to the address set forth below or the most
recent address as may be on the Company records for the Employee:
For Employee: Xxxx X. Xxxx
0000 Xxxx Xxx Xxx
Xxxxxx, XX 00000
For Company: DENTSPLY International
Inc.
000 Xxxx Xxxxxxx Xxxxxx
Xxxx, XX 00000
11. Arbitration Any controversy arising from or related to this
Agreement shall be determined by arbitration in the City of
Philadelphia, Pennsylvania, in accordance with the rules of the
American Arbitration Association, and judgment upon any such
determination or award may be entered in any court having
jurisdiction. In the event of any arbitration between Employee
and Company related to the Agreement, if employee shall be the
successful party, Company will indemnify and reimburse Employee
against any reasonable legal fees and expenses incurred in such
arbitration.
12. Applicable Law The Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of
Pennsylvania.
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IN WITNESS WHEREOF, the parties have executed the Agreement
on the day and year
first above written.
Attest: DENTSPLY INTERNATIONAL INC.
------------ -------------------
By:____________________________________
Secretary President and Chief Operating
Officer
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Xxxx X. Xxxx
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