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Exhibit 10.39
AGREEMENT
THIS AGREEMENT dated as of December 4, 1995, is made by and
between Wang Laboratories, Inc., a Delaware corporation (the "Company"), and
Xxxxxx X. Xxxxxx (the "Executive").
WHEREAS the Company considers it essential to the best interests
of its shareholders to xxxxxx the continuous employment of key management
personnel; and
WHEREAS the Board of Directors of the Company (the "Board")
recognizes that, as is the case with many publicly-held corporations, the
possibility of a Change in Control (as defined in the last Section hereof)
exists and that such possibility, and the uncertainty and questions which it may
raise among management, may result in the departure or distraction of management
personnel to the detriment of the Company and its shareholders; and
WHEREAS the Board has determined that appropriate steps should be
taken to reinforce and encourage the continued attention and dedication of
members of the Company's management, including the Executive, to their assigned
duties without distraction in the face of potentially disturbing circumstances
arising from the possibility of a Change in Control;
NOW THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the Company and the Executive hereby agree as
follows:
1. Defined Terms. The definition of capitalized terms used in
this Agreement is provided in the last Section hereof.
2. Terms of Agreement. This Agreement shall commence as of
December 4, 1995 and shall continue in effect while the Executive is employed by
the Company for a period of three years, provided, however, that commencing on
the third anniversary of the commencement of the term of this Agreement and on
each anniversary thereafter, the term of this Agreement shall automatically be
extended for one additional year unless, not later than ninety days prior to any
such anniversary date either party shall have given notice that it does not wish
to extend this Agreement (provided that no such notice may be given by the
Company during the pendency of or within one year following a Potential Change
in Control); provided, further, if a Change in Control shall have occurred
during the original or extended term of this Agreement, this Agreement shall
continue in effect for a period of thirty-six months beyond the month in which
such Change in Control occurred. It is
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intended, and the parties hereto agree, that (i) the benefit, if any, payable to
the Executive under any other severance or termination pay plan, arrangement or
agreement of or with the Company shall be reduced by the amount of any payment
actually provided under Section 6.1 hereof and (ii) any option to acquire shares
of the Company's common stock awarded to the Executive under any stock option or
other long-term incentive plan of the Company shall become fully exercisable
upon the occurrence of a Change in Control during the term of this Agreement,
provided that nothing herein shall otherwise affect or modify the terms of any
such option or the Executive's rights or obligations with respect thereto.
3. Company's Covenants Summarized. In order to induce the
Executive to become employed by or remain in the employ of the Company as the
case may be, and in consideration of the Executive's covenant set forth in
Section 4 hereof, the Company agrees, under the conditions described herein, to
pay the Executive the "Severance Payment" described herein in the event the
Executive's employment with the Company is terminated under the circumstances
described below following a Change in Control and during the term of this
Agreement. No amount or benefit shall be payable under this Agreement unless
there shall have been (or under the terms hereof, there shall be deemed to have
been) a termination of the Executive's employment with the Company following a
Change in Control.
4. The Executive's Covenants. The Executive agrees that, subject
to the terms and conditions of this Agreement, in the event of a Potential
Change in Control during the term of this Agreement, the Executive will remain
in the employ of the Company until the earliest of (i) a date which is six (6)
months from the date of such Potential Change in Control, (ii) the date of a
Change in Control, (iii) the date of termination by the Executive of the
Executive's employment for Good Reason (determined by treating the Potential
Change in Control as a Change in Control in applying the definition of Good
Reason), or by reason of Death, Disability or Retirement, or (iv) the
termination by the Company of the Executive's employment for any reason.
5. Compensation Other Than Severance Payment.
5.1 Following a Change in Control during the term of this
Agreement, during any period that the Executive fails to perform the Executive's
full-time duties with the Company as a result of incapacity due to physical or
mental illness, the Company shall continue to pay the Executive's full salary to
the Executive at the rate in effect at the commencement of any such period,
together with all compensation and benefits payable to the Executive under the
terms of any compensation or benefit plan, program or arrangement maintained by
the Company during such period, until the Executive's employment is terminated
by the Company for Disability.
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5.2 If the Executive's employment shall be terminated for any
reason following a Change in Control and during the term of this Agreement, the
Company shall pay the Executive's full salary to the Executive through the Date
of Termination at the rate in effect at the time the Notice of Termination is
given, together with all compensation and benefits payable to the Executive
through the Date of Termination under the terms of any compensation or benefit
plan, program or arrangement maintained by the Company during such period.
5.3 If the Executive's employment shall be terminated for any
reason following a Change in Control and during the term of this Agreement, the
Company shall, except as provided in Section 2 above, pay the Executive's normal
post-termination compensation and benefits to the Executive as such payments
become due. Such post-termination compensation and benefits shall be determined
under, and paid in accordance with, the Company's retirement, insurance and
other compensation or benefit plans, programs, agreements or arrangements.
6. Severance Payment.
6.1 Subject to Section 6.2 hereof, the Company shall pay the
Executive the payment described in this Section 6.1 (the "Severance Payment")
upon the termination of the Executive's employment following a Change in Control
during the term of this Agreement, in addition to the payments and benefits
described in Section 5 hereof, unless such termination is (i) by the Company for
Cause, (ii) by reason of the Executive's Death or Disability or (iii) by the
Executive without Good Reason. Moreover, the Executive's employment shall be
deemed to have been terminated following a Change in Control by the Company
without Cause or by the Executive with Good Reason if the Executive's employment
is terminated without Cause prior to a Change in Control at the direction of a
Person who has entered into an agreement with the Company the consummation of
which will constitute a Change in Control or if the Executive terminates his
employment with Good Reason prior to a Change in Control (determined by treating
a Potential Change in Control as a Change in Control in applying the definition
in Good Reason) if the circumstance or event which constitutes Good Reason
occurs at the direction of such Person. In lieu of any further salary payments
to the Executive for periods subsequent to the Date of Termination and in lieu
of any severance benefit otherwise payable to the Executive, the Company shall
pay to the Executive a lump sum severance payment, in cash, equal to 2.99 times
the average of the Executive's base salary and annual bonus received in (i) each
of the 2 calendar years preceding the calendar year in which occurs the Date of
Termination or, (ii) in the event the Executive has been employed by the Company
for less than 2 full calendar years, such lesser number of calendar years during
any
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part of which the Executive has been so employed, with his base salary taken
into account at its full annual rate for any partial year or years.
6.2.(a) In the event that the Executive's Total Payments (not
including the Gross-Up Payment), as hereinafter defined, are subject in whole or
in part to the excise tax imposed under Section 4999 of the Code (the "Excise
Tax"), then the Company shall pay to the Executive an additional amount (the
"Gross-Up Payment") such that the net amount retained by the Executive after
payment of any Excise Tax on the Total Payments and any federal, state and local
income taxes on the Gross-Up Payment equals the Total Payments, (not including
the Gross-Up Payment). Exhibit 6.2 attached hereto is an example of the
calculation of a Gross-Up Payment.
(b) For purposes of determining whether and the extent to which
the Total Payments will be subject to the Excise Tax, (i) no portion of the
Total Payments the receipt or enjoyment of which the Executive shall have
effectively waived in writing prior to the Date of Termination shall be taken
into account, (ii) no portion of the Total Payments shall be taken into account
which in the opinion of tax counsel selected by the Company does not constitute
a "parachute payment" within the meaning of Section 280G(b)(2) of the Code,
(including by reason of Section 280G(b)(4)(A) of the Code) and, in calculating
the Excise Tax, no portion of such Total Payments shall be taken into account
which constitutes reasonable compensation for services actually rendered, within
the meaning of Section 280G(b)(4)(B) of the Code, in excess of the Base Amount
allocable to such reasonable compensation, and (iii) the value of any non-cash
benefit or any deferred payment or benefit included in the Total Payments shall
be determined by the Company in accordance with the principles of Sections
280G(d)(3) and (4) of the Code.
(c) For purposes of determining the amount of the Gross-Up
Payment, the Executive shall be deemed to pay federal income taxes at the
highest marginal rate of federal income taxation in the calendar year in which
the Gross-Up Payment is to be made and state and local income taxes at the
highest marginal rate of taxation in the state and locality of the Executive's
residence on the Date of Termination, net of the maximum reduction in federal
income taxes which could be obtained from deduction of such state and local
taxes.
(d) For purposes of this Agreement, "Total Payments" means any
payment or benefit received or to be received by the Executive in connection
with a Change in Control or the termination of the Executive's employment,
whether pursuant to the terms of this Agreement or any other plan, arrangement,
or agreement
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with (i) the Company, (ii) any Person whose actions result in a Change in
Control, or (iii) any Person affiliated with the Company or the Person whose
actions resulted in a Change in Control. Total Payments includes, but is not
limited to Severance Payments and Gross-Up Payments.
6.3 (a) The Severance Payment and the Gross-Up Payment, if any,
shall be made not later than the fifth day following the Date of Termination,
provided, however, that if the amount of such payments cannot be finally
determined on or before such day, the Company shall pay to the Executive on such
day an estimate, as determined in good faith by the Company, of the minimum
amount of such payments to which the Executive is clearly entitled. In the event
that the Excise Tax is subsequently determined to be less than the amount taken
into account in originally computing the Gross-Up Payment, the Executive shall
repay to the Company at the time that the amount of such reduction in Excise Tax
is finally determined the portion of the Gross-Up Payment attributable to such
reduction (plus the portion of the Gross-Up Payment attributable to the Excise
Tax imposed on the Gross-Up Payment being repaid by the Executive if such
repayment results in a reduction in Excise Tax) plus interest on the amount of
such repayment at the rate provided in Section 7872(f)(2) of the Code. In the
event that the Excise Tax is determined to exceed the amount taken into account
in originally computing the Gross-Up Payment (including any increase as the
result of any payment which cannot be determined, or did not exist, at the time
of the originally computation), the Company shall recalculate the Gross-Up
Payment and pay the additional amount to the Executive (plus any interest
payable by the Executive on such additional Excise Tax or on any additional
federal, state and local income taxes) at the time that such additional amount
is finally determined.
(b) Prior to the payment date set forth in this Section 6.3, the
Company shall provide the Executive with the Company's calculation of the Total
Payments and the Gross-Up Payments, if any, and such supporting materials as are
reasonably necessary for the Executive to evaluate the Company's calculations,
including, without limitation, any opinions or other advice the Company has
received from outside counsel, auditors or consultants (and any such opinions or
advice which are in writing shall be attached to the statement).
6.4 The Company also shall pay to the Executive all legal fees
and expenses incurred by the Executive as a result of or in connection with a
termination of employment following a Change in Control and during the term of
this Agreement (including all such fees and expenses, if any, incurred in good
faith in disputing any such termination or in seeking in good faith to obtain or
enforce any benefit or right provided by this Agreement or in connection with
any tax audit or proceeding to the
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extent attributable to the application of section 4999 of the Code to any
payment or benefit provided hereunder). Such payments shall be made within five
(5) business days after delivery of the Executive's written requests for payment
accompanied with such evidence of fees and expenses incurred as the Company
reasonably may require.
7. Termination Procedures and Compensation During Dispute.
7.1 Notice of Termination. After a Change in Control and during
the term of this Agreement, any purported termination of the Executive's
employment (other than by reason of death) shall be communicated by written
Notice of Termination from one party hereto to other party hereto in accordance
with Section 10 hereof. For purposes of this Agreement, a "Notice of
Termination" shall mean a notice which shall indicate the specific termination
provision in this Agreement relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for termination of the
Executive's employment under the provision so indicated. Further, a Notice of
Termination for Cause is required to include a copy of a resolution duly adopted
by the affirmative vote of not less than three-quarters (3/4) of the entire
membership of the Board at a meeting of the Board which was called and held for
the purpose of considering such termination (after reasonable notice to the
Executive and an opportunity for the Executive, together with his counsel, to be
heard before the Board) finding that, in the good faith opinion of the Board,
the Executive was guilty of conduct set forth in the definition of Cause herein,
and specifying the particulars thereof in detail.
7.2 Date of Termination. "Date of Termination", with respect to
any termination of the Executive's employment after a Change in Control and
during the term of this Agreement, shall mean (i) if the Executive's employment
is terminated for Disability, thirty (30) days after Notice of Termination is
given (provided that the Executive shall not have returned to the full-time
performance of the Executive's duties during such thirty (30) day period), and
(ii) if the Executive's employment is terminated for any other reason, the date
specified in the Notice of Termination (which, in the case of a termination by
the Company, shall not be less than thirty (30) days (except in the case of a
termination for Cause) and, in the case of a termination by the Executive, shall
not be less than fifteen (15) days nor more than sixty (60) days, respectively,
from the date such Notice of Termination is given).
7.3 Dispute Concerning Termination. Notwithstanding any provision
of Section 7.2 hereof to the contrary, if within fifteen (15) days after any
Notice of Termination is received, or, if later, prior to the Date of
Termination (as determined without regard to this Section 7.3), the party
receiving such Notice of Termination notifies the other party in writing that a
dispute exists concerning the termination, the
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Date of Termination shall be the date on which the dispute is finally resolved,
either by mutual written agreement of the parties or by a final judgment, order
or decree of a court of competent jurisdiction (which is not appealable or with
respect to which the time for appeal therefrom has expired and no appeal has
been perfected); provided that the Date of Termination shall be extended by a
notice of dispute only if such notice is given in good faith and the party
giving such notice pursues the resolution of such dispute with reasonable
diligence. For the purposes of the preceding sentence, a dispute concerning
termination shall be deemed finally resolved if neither party commences an
action in any court within thirty (30) days of an arbitration award concerning
such dispute seeking the modification of or other relief from such award.
7.4 Compensation During Dispute. If a purported termination
occurs following a Change in Control and during the term of this Agreement, and
such termination is disputed in accordance with Section 7.3 hereof, the Company
shall continue to pay the Executive the full compensation in effect when the
notice giving rise to the dispute was given (including, but not limited to,
salary) and continue the Executive as a participant in all compensation, benefit
and insurance plans in which the Executive was participating when the notice
giving rise to the dispute was given, until the dispute is finally resolved in
accordance with Section 7.3 hereof. Amounts paid under this Section 7.4 are in
addition to all other amounts due under this Agreement (other than those due
under Section 5.2 hereof) and shall not be offset against or reduce any other
amounts due under this Agreement.
8. No Mitigation. The Company agrees that, if the Executive's
employment by the Company is terminated during the term of this Agreement, the
Executive is not required to seek other employment or to attempt in any way to
reduce any amounts payable to the Executive by the Company pursuant to this
Agreement. Further, the amount of any payment or benefit provided for in this
Agreement shall not be reduced by any compensation earned by the Executive as
the result of employment by another employer, by retirement benefits, by offset
against any amount claimed to be owed by the Executive to the Company, or
otherwise.
9. Successors.
9.1 In addition to any obligations imposed by law upon any
successor to the Company, the Company will require any successor (whether direct
or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. Failure of the Company to obtain such assumption and agreement
prior to the effectiveness of any such
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succession shall be a breach of this Agreement and shall entitle the Executive
to compensation from the Company in the same amount and on the same terms as the
Executive would be entitled to hereunder if the Executive were to terminate the
Executive's employment for Good Reason after a Change in Control, except that,
for purposes of implementing the foregoing, the date on which any such
succession becomes effective shall be deemed the Date of Termination.
10. Notices. For the purpose of this Agreement, notices and all
other communications provided for in the Agreement shall be in writing and shall
be deemed to have been duly given when delivered or mailed by United Stated
registered mail, return receipt requested, postage prepaid, addressed to the
respective addresses set forth below, or to such other address as either party
may have furnished to the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon actual receipt:
To the Company:
Wang Laboratories, Inc.
Xxx Xxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Chief Executive Officer
Copy to: General Counsel
To the Executive:
Xxxxxx X. Xxxxxx
00 Xxxxx Xxxx
Xxxxxxx, XX 00000
11. Miscellaneous. No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing and signed by the Executive and such officer as may be
specifically designated by the Board. No waiver by either party hereto at any
time of any breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or any prior or subsequent time. No agreements or representations, oral
or otherwise, express or implied, with respect to the subject matter hereof have
been made by either party which are not expressly set forth in this Agreement.
The validity, interpretation, construction and performance of this Agreement
shall be governed by the laws of the Commonwealth of Massachusetts. Any payments
provided for hereunder shall be paid net of any applicable withholding required
under federal, state or local law and any additional withholding to which the
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Executive has agreed. The obligations of the Company and the Executive under
Sections 5, 6 and 7 shall survive the expiration of the term of this Agreement.
12. Validity. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.
13. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
14. Arbitration. Any dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration
conducted before a panel of three arbitrators in Boston, Massachusetts in
accordance with the commercial rules of the American Arbitration Association
("AAA") then in effect. Unless the panel of arbitrators shall have been selected
by agreement of the parties within thirty (30) days of the initiation of
arbitration proceedings, each party shall be entitled to select one arbitrator
within ten (10) business days of the lapse of such thirty (30) day period and
the third arbitrator shall be selected by agreement of the two arbitrators so
selected within seven (7) business days after the selection of the two
arbitrators. In the event that either party does not timely designate an
arbitrator or that the two arbitrators do not timely select a third arbitrator
in accordance with the preceding sentence, then upon application of either party
to the Boston office of the AAA, the AAA shall designate such arbitrator.
Judgment may be entered on the arbitrators' award in any court having
jurisdiction, provided, however, that the Executive shall be entitled to seek
specific performance of his right to be paid until the Date of Termination
during the pendency of any dispute or controversy arising under or in connection
with this Agreement.
15. Nondisclosure of Confidential Information. The Executive
shall keep secret and confidential and shall not disclose to any third party in
any fashion or for any purpose whatsoever, any information regarding this
Agreement, or any other information regarding the Company which is (i) not
available to the general public, and/or (ii) not generally known outside the
Company, to which he has or will have had access at any time during the course
of his employment by the Company, including, without limitation, any information
relating to: the Company's business or operations; its plans, strategies,
prospects or objectives; its products, technology, processes or specifications;
its research and development operations or plans; its customers and customer
lists; its manufacturing, distribution, sales, service, support and marketing
practices and operations; its financial condition and results of operations; its
operational strengths and weaknesses; and, its personnel and compen-
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sation policies and procedures. Notwithstanding the foregoing provisions of this
Section 15, the Executive may discuss this Agreement with the members of his
immediate family and with his personal legal and tax advisors, provided that,
prior to disclosing any term or condition of this Agreement to any person, the
Executive shall obtain from such person for the benefit of the Company his or
her agreement to observe the foregoing provisions.
16. Definitions. For purposes of this Agreement, the following
shall have the meanings indicated below:
(A) "Base Amount" shall have the meaning defined in section
280G(b)(3) of the Code.
(B) "Beneficial Owner" and "Beneficial Ownership" shall have the
meaning defined in, and shall be determined pursuant to, Rule 13d-3 under the
Securities Exchange Act of 1934, as amended.
(C) "Board" shall mean the Board of Directors of the Company.
(D) "Cause" for termination by the Company of the Executive's
employment, after any Change in Control, shall mean the willful and continued
failure by the Executive to substantially perform the Executive's duties with
the Company, a substantial, and not de minimis, violation of the Company's
Standards of Ethics and Business Conduct or its Rules of Employee Conduct (and
any successor documents, however titled), as the same are in effect from time to
time, the Executive's conviction of a felony or engaging in conduct that
constitutes a violation of Section 15 hereof.
(E) A "Change in Control" shall be deemed to have occurred if any
one of the conditions set forth in any one of the following paragraphs shall
have been satisfied:
(i) any Person (other than a trustee or other fiduciary
holding securities under an employee benefit plan of the Company) is or
becomes the Beneficial Owner, directly or indirectly, of securities of
the Company (not including in the securities beneficially owned by such
Person any securities acquired directly from the Company or its
affiliates) representing 20% or more of the combined voting power of the
Company's then outstanding securities; or
(ii) during any period of twenty-four consecutive months
(not including any period prior to the execution of this Agree-
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ment), individuals who at the beginning of such period constitute the
Board and any new director (other than a director designated by a Person
who has entered into an agreement with the Company to effect a
transaction constituting a Change in Control as described in clause (I),
(III) or (IV) of this paragraph) whose election by the Board or
nomination for election by the Company's stockholders was approved by a
vote of at least two-thirds (2/3) of the directors then still in office
who either were directors at the beginning of the period or whose
election or nomination for election was previously so approved, cease
for any reason to constitute a majority thereof; or
(iii) the shareholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than (i)
a merger or consolidations which would result in the voting securities
of the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into
voting securities of the surviving entity), in combination with the
ownership of any trustee or other fiduciary holding securities under an
employee benefit plan of the Company, at least 75% of the combined
voting power of the voting securities of the Company or such surviving
entity outstanding immediately after such merger or consolidation, or
(ii) a merger or consolidation effected to implement a recapitalization
of the Company (or similar transaction) in which no Person acquires more
than 20% of the combined voting power of the Company's then outstanding
securities; or
(iv) the shareholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all the Company's
assets or the Company is dissolved and its assets distributed in a
judicial proceeding.
(F) "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time. All references to the Code shall be deemed also to
refer to any successor provisions to such sections.
(G) "Company" shall mean Wang Laboratories, Inc., and any
successor to its business and/or assets which assumes and agrees to perform this
Agreement by operation of law, or otherwise (except in determining, under
Section 16(E) hereof, whether or not any Change in Control of the Company has
occurred in connection with such succession).
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(H) "Date of Termination" shall have the meaning stated in
Sections 7.2 and 7.3 hereof.
(I) "Disability" shall be deemed the reason for the termination
by the Company of the Executive's employment, if, as a result of the Executive's
incapacity due to physical or mental illness, the Executive shall have been
absent from the full-time performance of the Executive's duties with the Company
for a period of six (6) consecutive months, the Company shall have given the
Executive a Notice of Termination for Disability, and, within thirty (30) days
after such Notice of Termination is given, the Executive shall not have returned
to the full-time performance of the Executive's duties.
(J) "Executive" shall mean the individual named in the first
paragraph of this Agreement.
(K) "Good Reason" for termination by the Executive of the
Executive's employment shall mean the occurrence (without the Executive's
express written consent) of any one of the following acts by the Company, or
failures by the Company to act, unless, in the case of any act or failure to act
described in paragraph (i), (v), (vi), (vii), or (viii) below, such act or
failure to act is corrected prior to the Date of Termination specified in the
Notice of Termination given in respect thereof:
(i) the assignment to the Executive of any duties
inconsistent with the Executive's status as a senior office of the
Company or a substantial adverse alteration in the nature or status of
the Executive's position or responsibilities from those in effect
immediately prior to the Change in Control;
(ii) a reduction by the Company in the Executive's annual
base salary as in effect on the date hereof or as the same may be
increased from time to time except for across-the-board salary
reductions similarly affecting all senior executives of the Company and
all senior executives of any Person in control of the Company;
(iv) the failure by the Company to pay to the Executive
any portion of the Executive's current compensation except pursuant to
an across-the-board compensation deferral similarly affecting all senior
executives of the Company and all senior executives of any Person in
control of the Company, or to pay to the Executive any portion of an
installment of deferred compensation under any deferred
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compensation program of the Company, within fourteen (14) days of the
date such compensation is due;
(v) the failure by the Company to continue in effect any
compensation plan in which the Executive participates immediately prior
to the Change in Control which is material to the Executive's total
compensation, unless an equitable arrangement (embodied in an ongoing
substitute or alternative plan) has been made with respect to such plan,
or the failure by the Company to continue the Executive's participation
therein (or in a substitute or alternative plan) on a basis not
materially less favorable, both in terms of the amount of benefits
provided and the level of the Executive's participation relative to
other participants, as existed at the time of the Change in Control;
(vi) the failure by the Company to continue to provide the
Executive with benefits substantially similar to those enjoyed by the
Executive under any of the Company's pension, life insurance, medical,
health and accident, or disability plans in which the Executive was
participating at the time of the Change in Control, the taking of any
action by the Company which would directly or indirectly materially
reduce any of such benefits or deprive the Executive of any material
fringe benefit enjoyed by the Executive at the time of the Change in
Control, or the failure by the Company to provide the Executive with the
number of paid vacation days to which the Executive is entitled on the
basis of years of service with the Company in accordance with the
Company's normal vacation policy in effect at the time of the Change in
Control;
(vii) any purported termination of the Executive's
employment which is not effected pursuant to a Notice of Termination
satisfying the requirements of Section 7.1; for purposes of this
Agreement, no such purported termination shall be effective; or
(viii) the failure by the Company to obtain a satisfactory
agreement from any successor to assume and agree to perform this
Agreement, as contemplated in Section 9 hereof.
The Executive's right to terminate the Executive's employment for
Good Reason shall not be affected by the Executive's incapacity due to physical
or mental illness. The Executive's continued employment shall not constitute
consent to,
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or a waiver of rights with respect to, any act or failure to act constituting
Good Reason hereunder.
(L) "Notice of Termination" shall have the meaning stated in
Section 7.1 hereof.
(M) "Person" shall have the meaning defined in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended.
(N) "Potential Change in Control" shall be deemed to have
occurred if any one of the conditions set forth in any one of the following
paragraphs shall have been satisfied:
(i) the Company enters into an agreement, the consummation
of which would result in the occurrence of a Change in Control;
(ii) the Company or any other Person publicly announces an
intention to take or to consider taking actions which, if consummated,
would constitute a Change in Control;
(iii) any Person (other than a trustee or other fiduciary
holding securities under an employee benefit plan of the Company) who is
or becomes the Beneficial Owner, directly or indirectly, of securities
of the Company representing 10% or more of the combined voting power of
the Company's then outstanding securities, increases such Person's
Beneficial Ownership of such securities by 5% or more over the
percentage so owned by such Person on the date hereof; or
(iv) the Board adopts a resolution to the effect that, for
purposes of this Agreement, a Potential Change in Control has occurred.
(O) "Retirement" shall mean retirement after attaining "normal
retirement age" under any pension or retirement plan maintained by the Company
in which the Executive participates.
(P) "Severance Payment" shall mean the payment described in
Section 6.1 hereof.
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(Q) "Total Payment" shall mean those payments described in
Section 6.2 hereof.
WANG LABORATORIES, INC.
By: /s/ Xxxxxx X. Xxxxx
-------------------------
Xxxxxx X. Xxxxx
Chairman of the Board and
Chief Executive Officer
AGREED:
/s/ Xxxxxx X. Xxxxxx
------------------------
Xxxxxx X. Xxxxxx
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