The following agreement was executed as of February 20, 1996, by the Registrant
and by each of the following executive officers of the Registrant: Xxxxxx X.
Xxxxxx, Xx.; Xxxxxx X. Xxxxxxxx; Xxxxxx X. Xxxxx; and Xxxxxxx X. Xxxxxx. The
terms of each such definitive agreement are otherwise identical to the form set
forth below.
[FORM OF]
CHANGE IN CONTROL AGREEMENT
THIS AGREEMENT between Xxxxxxx Corporation, a Delaware corporation
(the "Company"), and (the "Employee") is dated as of February 20, 1996 (the
"Effective Date").
W I T N E S S E T H:
WHEREAS, the Company considers it to be in the best interests of its
stockholders to encourage the continued employment of key employees of the
Company in that the continuity of competent management is essential to
protecting and enhancing the best interests of the Company and its
stockholders; and
WHEREAS, the Employee is a key employee of the Company having served
in an executive capacity at the Company thereby acquiring an intimate
knowledge of the business and affairs of the Company and having clearly
demonstrated the ability to perform valuable services for the Company; and
WHEREAS, the Company believes that the possibility of the occurrence
of a Change in Control of the Company (as that phrase is defined in
Section 2) may result in the termination of the Employee's employment by
the Company or in the distraction of the Employee from the performance of
his duties to the Company, in either case to the detriment of the Company
and its stockholders; and
WHEREAS, the Company recognizes that the Employee could suffer
adverse financial and professional consequences if a Change in Control of
the Company were to occur; and
WHEREAS, the Company wishes to enter into this Agreement to protect
the Employee if a Change in Control of the Company occurs, thereby
encouraging the Employee to remain in the employ of the Company and not
be distracted from the performance of his duties to the Company;
NOW, THEREFORE, the parties agree as follows:
Section 1. Other Employment Arrangements. Except as provided in
Section 10, this Agreement does not affect the Employee's existing or
future employment arrangements with the Company. The Employee's employment
by the Company shall continue to be at the will of the Company. If a Change
in Control of the Company shall occur before the expiration of the term of
this Agreement, then, whether or not the Employee's employment by the
Company shall at any time be terminated, the Employee shall be entitled to
receive the benefits provided for in this Agreement. This Agreement
therefore modifies the current executive Severance Policy of the Company
in the context of a Change in Control of the Company.
Section 2. Change in Control of the Company. A "Change in Control
of the Company" shall have occurred if, after the Effective Date, (i) any
person (within the meaning of Section 13(d) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act")) other than the Company or an
Affiliate shall become the beneficial owner (as that term is defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of 20 percent
or more of the outstanding Voting Stock (such person's beneficial ownership
to be determined, in the case of rights to acquire Voting Stock, pursuant
to paragraph (d) of Rule 13d-3 under the Exchange Act) or (ii) the
stockholders of the Company shall approve (w) a merger or consolidation of
the Company with or into any person other than an Affiliate, (x) any sale,
lease, exchange or other transfer of all or substantially all the assets of
the Company to any person other than an Affiliate or (y) the dissolution of
the Company.
Section 3. Term of this Agreement. The term of this Agreement shall
begin on the Effective Date and, unless extended pursuant to the second
sentence of this Section or terminated pursuant to the third sentence of this
Section, shall expire at the end of the three-year period beginning on the
Effective Date (the "Expiration Date"). If the Company shall not have given
written notice to the Employee at least 45 days before the Expiration Date
that the term of this Agreement will expire on the Expiration Date, then the
term of this Agreement shall be extended automatically for successive
one-year periods (the first such period to begin on the day immediately
following the Expiration Date) unless and until the Company shall give
written notice to the Employee at least 45 days before the end of any
one-year period for which the term of this Agreement shall have been
extended that such term will expire at the end of such one-year period,
whereupon the term of this Agreement shall expire at the end of such
one-year period. This Agreement shall in any event expire upon the
termination by the Employee or the Company of the Employee's employment by
the Company, unless there has been a Change in Control of the Company.
Section 4. Benefits Payable on Change in Control. If a Change in
Control of the Company shall occur before the expiration of the term of this
Agreement, then the Employee shall be entitled to the following benefits:
(i) the Company shall pay to the Employee, as a lump sum, an
amount equal to the sum of:
(A) three times the amount of the Employee's annual base
salary as in effect on the date of occurrence of the Change in
Control of the Company (the "Change in Control Date"), plus
(B) three times the amount of the largest annual cash
bonus paid or payable by the Company to the Employee for services
rendered during any one of the three most recent fiscal years of
the Company, regardless of when such bonus may have been paid or
payable, plus
(C) the amount, if positive, equal to the aggregate spread
between the exercise prices of all outstanding unexercised options
to purchase shares of the Company's capital stock ("Shares") and
other rights whose value derives from the value of Shares
(including, without limitation, "cash-only" stock appreciation
rights), which options or rights had been issued by the Company
and are held by the Employee on the Change in Control Date, whether
or not enough time had elapsed from the date of grant of such
options or rights so as to make them fully exercisable or vested
on the Change in Control Date, and the higher of
(1) the closing price of the Shares as reported on the
New York Stock Exchange or in the over-the-counter market,
as the case may be, on the Change in Control Date, or
(2) the highest price per Share actually paid in
connection with the Change in Control of the Company, plus
(D) an additional amount equal to the aggregate of any and
all federal, state and local income tax and excise tax liabilities
of the Employee resulting from the payments due pursuant to clauses
(A), (B), (C) and (D) hereof; and
(ii) the Company (at its sole expense) shall take the following
actions:
(A) throughout the three-year period immediately following
the Change in Control Date (the "Relevant Period"), the Company
shall maintain in effect, and not materially reduce the benefits
provided by, each of the Benefit Plans; and
(B) the Company shall arrange for the Employee's
uninterrupted participation throughout the Relevant Period in
each of the Benefit Plans, provided that, if the Employee's
participation in any Benefit Plan is not permitted by its terms,
then, throughout the Relevant Period, the Company (at its sole
expense) shall provide the Employee with substantially the same
benefits as were provided to the Employee pursuant to such Benefit
Plan on the Change in Control Date.
Each payment required to be made to the Employee pursuant to the foregoing
provisions of this Section shall be made by check drawn on an account of
the Company at a bank located in the United States of America and shall be
paid not more than 10 days after the Change in Control Date. Upon payment in
full to the Employee of all amounts due under subsection (i) of this Section,
all of the options and other rights referred to in clause (C) of such
subsection as to which payment has been made shall be automatically cancelled.
Section 5. Notices. Notices required or permitted to be given by
either party pursuant to this Agreement shall be in writing and shall be
deemed to have been given when delivered personally to the other party or
when deposited with the United States Postal Service as registered mail with
postage prepaid and addressed:
(i) if to the Employee, at the Employee's address last shown
on the Company's records, and
(ii) if to the Company, at 0 Xxxxxxxx Xxxxxxx Xxxxxx, Xxxxxxxx,
Xxxxxxx 00000, directed to the attention of the Chief Executive Officer;
or, in either case, to such other address as the party to whom or to which
such notice is to be given shall have specified by notice given to the other
party.
Section 6. Withholding Taxes. The Company may withhold from all
payments to be paid to the Employee pursuant to this Agreement all taxes
that, by applicable federal, state or local law, the Company is required
to so withhold.
Section 7. Expenses of Enforcement. Upon demand by the Employee
made to the Company, the Company shall reimburse the Employee for all
reasonable expenses (including legal fees and expenses) incurred by the
Employee in enforcing or seeking to enforce the payment of any amount or
other benefit to which the Employee shall become entitled pursuant to this
Agreement.
Section 8. Employment by Subsidiaries. If, at the Effective Date,
the Employee is an employee of a subsidiary of the Company, then references
in this Agreement to the Employee's employment by the Company shall be
understood as references to the Employee's employment by the subsidiary.
Section 9. No Obligation to Mitigate. The Employee shall not be
required to mitigate the amount of any payment or other benefit required
to be paid to the Employee pursuant to this Agreement, whether by seeking
other employment or otherwise, nor shall the amount of any such payment or
other benefit be reduced on account of any compensation earned by the
Employee as a result of employment by another person.
Section 10. Confidential Information. From the Effective Date until
the expiration of the term of this Agreement, the Employee shall hold in a
fiduciary capacity for the benefit of the Company all secret or confidential
information, knowledge or data relating to the Company or any of its
affiliated companies, and their respective businesses, that shall have been
obtained by the Employee during the Employee's employment by the Company or
any of its affiliated companies and that shall not have become public
knowledge (other than as a result of acts by the Employee in violation of
this Section). The Company shall not withhold or reduce any amount or
other benefit payable to the Employee pursuant to the terms of this
Agreement, or otherwise, on the ground that the Employee has breached or
threatened to breach the foregoing provisions of this Section; the sole
remedy of the Company for a breach or anticipated breach of such provisions
shall be injunctive relief.
Section 11. Amendment and Waiver. The Company, acting through the
Board of Directors, may amend or waive any or all of the Company's
obligations set forth in Section 4 at any time prior to the occurrence of
a Change in Control of the Company. Otherwise, no provision of this Agreement
may be amended or waived other than by written instrument signed by both
parties. No waiver by either party of any breach of this Agreement shall
be considered a waiver of any other or subsequent breach.
Section 12. Governing Law. This Agreement shall be governed by,
and construed in accordance with, the laws of the State of Georgia.
Section 13. 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.
Section 14. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original but all of which
together will constitute the same instrument.
Section 15. Assignment. This Agreement shall inure to the benefit
of and be enforceable by the Employee's legal representative. The
Company may not assign any of its obligations under this Agreement unless
such assignment is to a person with or into which the Company shall have
been merged or consolidated or to which the Company shall have transferred
its assets as an entirety or substantially as an entirety.
Section 16. Interpretation.
(a) In the event of the enactment of any successor
provision to any statute or rule cited in this Agreement,
references in this Agreement to such statute or rule shall be to
such successor provision. The headings of Sections of this
Agreement shall not control the meaning or interpretation of this
Agreement. References in this Agreement to any Section are to
the corresponding Section of this Agreement unless the context
otherwise indicates.
(b) As used in this Agreement, the following terms have the
meanings indicated:
(i) "Affiliate" means any person who is, at the date hereof,
controlling or controlled by, or under common control with, the Company.
(ii) "Benefit Plans" means all of the Company's employee benefit
plans, including life insurance and medical, dental, health, accident
and disability plans, in which the Employee was a participant on the
Change in Control Date.
(iii) "Board of Directors" means the Board of Directors of the
Company or any duly authorized committee thereof.
(iv) "Company" has the meaning assigned to such term in the
recitals to this Agreement and shall include any person with or into
which such person shall have been merged or consolidated or to which
such person shall have transferred its assets as an entirety or
substantially as an entirety.
(v) The term "person" means any individual, corporation,
partnership, joint venture, association, joint-stock company, limited
partnership, limited liability company, trust, unincorporated
organization, government or agency or political subdivision of any
government. When the context of this Agreement so indicates, such term
also has the meaning assigned to it in Section 13(d) of the Exchange
Act.
(vi) The term "this Agreement" means this Change of Control
Agreement as it may be amended from time to time in accordance with
Section 11.
(vii) "Voting Stock" means shares of capital stock of the Company
the holders of which are entitled to vote for the election of
directors of the Company, but excluding shares entitled to vote only
upon the occurrence of a contingency unless that contingency shall
have occurred.
IN WITNESS WHEREOF, the Company and the Employee have executed this
Agreement as of the Effective Date.
XXXXXXX CORPORATION Approved:
By: By:
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Xxxxxx X. Xxxxxxxxxx
Chairman, Compensation Committee of
the Board of Directors
THE EMPLOYEE:
(L.S.)
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