1
Exhibit 10.14(d)
SECOND AMENDED AND RESTATED
MANAGEMENT RETENTION AGREEMENT
(TIER 3)
THIS SECOND AMENDED AND RESTATED AGREEMENT is entered into as
of the _____ day of March, 1997 (the "Effective Date") by and between Caliber
System, Inc., an Ohio corporation (together with its successors and assigns
permitted under this Agreement the "Company"), and Mr. X ("Executive").
W I T N E S S E T H
WHEREAS, Executive currently serves as [title] of [company];
and
WHEREAS, the Company considers the establishment and
maintenance of a sound and vital management to be essential to protecting and
enhancing the best interests of the Company and its shareholders; and
WHEREAS, the Board (as defined in Section 1(b)) has determined
that it is in the best interests of the Company and its stockholders to secure
Executive's continued services and to ensure Executive's continued dedication
and objectivity in the event of any threat or occurrence of, or negotiation or
other action that could lead to, or create the possibility of, a Change in
Control (as defined in Section 1(d)) of the Company, without concern as to
whether Executive might be hindered or distracted by personal uncertainties and
risks created by any such possible Change in Control, and to encourage
Executive's full attention and dedication to the Company, the Board has
authorized the Company to enter into this Agreement.
NOW, THEREFORE, for and in consideration of the premises and
the mutual covenants and agreements herein contained, the Company and Executive
hereby agree as follows:
1. Definitions.
------------
As used in this Agreement, the following terms shall
have the respective meanings set forth below:
(a) "Affiliate" of a person or other entity means
a person or entity that directly or indirectly controls, is controlled by, or is
under common control with the person or other entity specified.
(b) "Board" means the Board of Directors of the
Company.
(c) "Cause" means (1) conviction of Executive
for a felony or for a misdemeanor involving moral turpitude or (2) a material
breach by Executive of the duties and responsibilities associated with his
employment and position with the Company (other than as a result of incapacity
due to physical or mental illness) which is demonstrably willful and deliberate
on Executive's part, which results in demonstrably material economic injury to
the
2
2
Company and which is not remedied in a reasonable period of time after
receipt of written notice from the Company specifying such breach.
Cause shall not exist unless and until the Company has
delivered to Executive a copy of a resolution duly adopted by three-quarters
(3/4) of the Board and to the extent applicable, three quarters (3/4) of the
Incumbent Directors, if any, as defined below, at a meeting of the Board called
and held for such purpose (after reasonable notice to Executive and an
opportunity for Executive, together with his counsel, to be heard before the
Board), finding that in the good faith opinion of the Board, Executive was
guilty of the conduct set forth in this Section 1(c) and specifying the
particulars thereof in detail.
(d) "Change in Control" means the occurrence of
any of the following events:
(1) any "person," as such term is used
in Sections 3(a)(9) and 13(d) of the 1934 Act, becomes a "beneficial
owner," as such term is used in Rule 13d-3 promulgated under the 1934 Act, of
20% or more of the combined voting power of all the Voting Securities of the
Company then outstanding;
(2) the majority of the Board consists of
individuals other than Incumbent Directors, which term means the members of
the Board on the date of this Agreement; provided that any person becoming a
director subsequent to such date whose election or nomination for election was
supported by three-quarters of the directors who then comprised the Incumbent
Directors shall be considered to be an Incumbent Director;
(3) the Company adopts any plan of
liquidation providing for the distribution of all or substantially all of
its assets;
(4) all or substantially all of the assets
of the Company are disposed of pursuant to a merger, consolidation or other
transaction (unless the holders of the Voting Securities of the Company
immediately prior to such merger, consolidation or other transaction
beneficially own, directly or indirectly, in substantially the same proportion
as they owned the Voting Securities of the Company, all of the Voting Securities
or other ownership interests of the entity or entities, if any, that succeed to
the business of the Company); or
(5) the Company combines with another
company and is the surviving corporation but, immediately after the
combination, the holders of the Voting Securities of the Company immediately
prior to the combination hold, directly or indirectly, 50% or less of the Voting
Securities of the combined company (there being excluded from the Voting
Securities held by such holders of the Voting Securities, but not from the
Voting Securities of the combined company, any securities received by Affiliates
of such other company in exchange for securities of such other company).
Notwithstanding anything contained in this Agreement to
the contrary, if Executive's employment is terminated by the Company prior to a
Change in Control, which Change in Control in fact occurs, and Executive
reasonably demonstrates that such termination was at the request of a third
party who effectuates such Change in Control or that such termination was
directly related to or in anticipation of such Change in Control, then for all
purposes of this Agreement, the date of the Change of Control shall mean the
date immediately prior to the date of such termination of Executive's
employment.
3
3
(e) "Date of Termination" means (1) the effective date on
which Executive's employment by the Company terminates as specified in a
Notice of Termination by the Company or Executive, as the case may be, or (2) if
Executive's employment by the Company terminates by reason of death, the date of
death of Executive. Notwithstanding the previous sentence, (i) if Executive's
employment is terminated for Disability (as defined in Section 1(f)) or (ii) if
Executive's employment is terminated by the Company other than for Cause, then
such Date of Termination shall be no earlier than thirty (30) days following the
date on which a Notice of Termination is received.
(f) "Disability" means Executive's absence from his duties
with the Company on a full-time basis for at least one hundred eighty (180)
consecutive days as a result of Executive's incapacity due to mental or physical
illness.
(g) "Good Reason" shall mean termination by Executive of
his employment following occurrence of any of the following events without
his consent:
(i) a reduction in Executive's base salary or target
award opportunity as in effect immediately prior to the Change in Control
(including a change in performance criteria which impacts negatively on
Executive's ability to achieve the target) under the Company's annual or
long-term performance incentive plans or programs, the failure to continue
Executive's participation in any incentive compensation plan in which he was a
participant immediately prior to the Change in Control unless a plan providing a
substantially similar opportunity is substituted, or the termination or material
reduction of any employee benefit or perquisite enjoyed by him immediately prior
to the Change in Control, unless comparable benefits or perquisites (determined
in the aggregate) are substituted;
(ii) material diminution in Executive's duties as in
effect immediately prior to the Change in Control or assignment to
Executive of duties materially inconsistent with his duties as in effect
immediately prior to the Change in Control;
(iii) the loss of any of Executive's titles or positions
held immediately prior to the Change in Control; or
(iv) the failure of the Company to obtain the assumption
in writing of its obligation to perform the agreement by any successor to
all or substantially all of the assets of the Company within 30 days after a
merger, consolidation, sale or similar transaction.
Notwithstanding anything contained in this Agreement to the
contrary, any circumstance described in clauses (i) through (iii) of this
Section 1(g) shall not constitute Good Reason unless Executive gives written
notice thereof to the Company in accordance with Section 12 and the Company
fails to remedy such circumstances within ten days following receipt of such
notice.
(h) "Notice of Termination" means notice of the Date of
Termination as described in Section 12(b).
(i) "Qualifying Termination" means a termination of
Executive's employment as a result of (1) a termination by the Company
without Cause or (2) a termination
4
4
by Executive for Good Reason; provided, however, that a Qualifying
Termination shall not include a termination as a result of Executive's death,
Disability or Retirement.
(j) "Retirement" means Executive's voluntary termination of
employment (other than with Good Reason) while eligible for retirement
benefits under the terms of the Caliber System, Inc. Pension Plan and Trust.
(k) "Retirement and Savings Plans" mean all qualified and
nonqualified defined benefit and defined contribution plans, including:
[Applicable qualified and nonqualified benefit plans]
or any applicable amended, successor or substitute plan or plans of the Company,
including any supplemental employee retirement plans, put into effect prior to a
Change in Control.
The Caliber System, Inc. Long-Term Stock Award Incentive
Plan is included in the definition of Retirement and Savings Plans to the
extent that it provides Executive with supplemental stock credits.
(l) "Transition Period" means the period of time beginning
with a Change in Control and ending on the earlier to occur of (1)
Executive's death and (2) twenty-four (24) months following such Change in
Control.
(m) "Voting Securities" mean any shares of capital stock or
other securities of the Company that are generally entitled to vote in elections
for directors.
2. Term of Agreement.
------------------
This Agreement shall commence on the Effective Date and shall
continue in effect until _______, 1999; provided, however, that commencing on
____________, 1999 and each following anniversary of the Effective Date, the
term of this Agreement shall automatically be extended for an additional
one-year period, unless at least six months prior to such date, the Company
shall have given notice not to extend this Agreement; provided, however, that
(i) no such action shall be taken by the Company during any period of time when
the Board has knowledge that any person has taken steps reasonably calculated to
effect a Change in Control until, in the opinion of the Board, such person has
abandoned or terminated its efforts to effect a Change in Control, and (ii) this
Agreement shall continue in effect for at least twenty-four (24) months
following the occurrence of a Change in Control. Notwithstanding anything in
this Section 2 to the contrary, and subject to the last paragraph of Section
1(d), this Agreement shall terminate upon termination of Executive's employment
with the Company prior to a Change in Control, in which event the rights and
obligations of the parties, except as otherwise expressly provided herein, shall
cease.
3. Payments and Benefits Upon Termination of Employment.
-----------------------------------------------------
(a) If during the Transition Period the employment of
Executive shall terminate, by reason of a Qualifying Termination, then the
Company shall pay to Executive (or Executive's beneficiary or estate) within
five (5) days following the Date of Termination, as compensation for services
rendered to the Company:
5
5
(1) a lump-sum cash amount equal to the sum of (i)
Executive's unpaid base salary from the Company and its subsidiaries
through the Date of Termination (at the rate in effect (without taking into
account any reduction of base salary constituting Good Reason) just prior to the
time a Notice of Termination is given); (ii) any benefit awards (including both
the cash and stock components) which pursuant to the terms of any Retirement and
Savings Plans have been earned or become payable through the Date of
Termination, to the extent not theretofore paid or otherwise provided for; (iii)
that portion of the target annual bonus under the Company's incentive
compensation plans determined by multiplying the target annual bonus by the
fraction arrived at by dividing the number of full weeks worked by Executive
during the calendar year of his Date of Termination by fifty-two (52); plus (iv)
any unpaid vacation under the Company's vacation policy in effect at the Date of
Termination (or, if more favorable to Executive, immediately prior to a Change
in Control).
(2) a lump-sum cash amount equal to (a) 2 times
Executive's highest annual rate of base salary from the Company and its
subsidiaries in effect during the 12-month period prior to the Date of
Termination plus (b) 2 times the target annual bonus in effect for the year in
which the Change in Control occurs; provided, that any amount paid pursuant to
this Section 3(a)(2) shall be offset by any other amount of severance relating
to salary or bonus continuation to be received by Executive upon termination of
employment of Executive under any other severance plan, policy, employment
agreement or arrangement of the Company.
(3) a lump-sum cash amount equal to the actuarial
present value as of the Date of Termination of the benefits that would be
attributable to the additional twenty-four (24) months of age and service under
the Retirement and Savings Plans.
(b) If during the Transition Period, the employment of
Executive terminates by reason of a Qualifying Termination, the Company will:
(1) provide Executive and his dependents with health
care coverage at the same level as that in effect immediately prior to the
Date of Termination (or, if more favorable to Executive, immediately prior to
the Change in Control) ("Continued Medical Coverage") for a period of 42 months
from the Date of Termination; and
(2) provide Executive and his dependents with
accident, disability and life coverage at the same level and upon the same
terms and otherwise to the same extent as that in effect immediately prior to
the Date of Termination (or, if more favorable to Executive, immediately prior
to the Change in Control) ("Welfare Benefits") for a period of 24 months from
the Date of Termination.
(3) The coverages described in subparagraphs (1) and
(2) of this Section may be provided through continued participation in the
Company's plans and programs or otherwise, as the Company determines.
(4) During the first twenty four (24) months of
Continued Medical Coverage, the Company and Executive will share the costs
of such coverage in the same proportion as such costs were shared immediately
prior to the Date of Termination (or, if more favorable to Executive,
immediately prior to the Change in Control). From the twenty-fifth (25th)
through the end of the of the forty-second (42nd) month of Continued Medical
Coverage, Executive will be required to pay the cost of such coverage at the
rate the Company charges former employees, from time to time, for similar
coverage under COBRA. The Company and
6
6
Executive will share the costs of providing the Welfare Benefits in the
same proportion as such costs were shared immediately prior to the Date of
Termination (or, of more favorable to Executive, immediately prior to the Change
in Control).
(5) Continued Medical Coverage will terminate upon the
earliest of (i) the expiration of 42 months from the Date of Termination,
(ii) the commencement date of equivalent benefits from a new employer, or (iii)
Executive's attainment of age 65. Welfare Benefits will terminate upon the
earliest of (i) the expiration of 24 months from the Date of Termination, (ii)
the commencement date of equivalent benefits a new employer, or (iii)
Executive's attainment of age 65. Upon termination of Continued Medical
Coverage, Executive may, if eligible, elect special continuation coverage for
early retirees under the Caliber System, Inc. Medical, Dental and Vision Care
Plan. Upon termination of Welfare Benefits, Executive may, if available, convert
one or more of Executive's and his dependent's coverage to individual policies
or programs.
4. Consequences of a Change in Control upon Certain Entitlements.
--------------------------------------------------------------
(a) The consequences of a Change in Control on Executive's stock
options and performance shares granted under the Company's 1996 Equity
Incentive Compensation Plan ("EICP") shall be determined in accordance with the
EICP and Executive's grants pursuant to the EICP.
(b) No later than the occurrence of a Change in Control, the Company
shall fund in full that portion, if any, of the obligations to Executive
under the Company's Retirement and Savings Plans (other than plans qualified
under Section 401(a) of the Internal Revenue Code) that are then unfunded. Such
funding shall be provided through an irrevocable trust for the benefit of the
Executive which shall be established as promptly as possible following the
Effective Date of this Agreement (or, in the case of a Retirement and Savings
Plan established after such effective date, then as promptly as possible after
such plan is established) for the purpose of receiving contributions from the
Company to fund such obligations. To the extent such obligations are covered by
a plan other than a plan for which there is a trust already in existence, the
Company shall establish a trust for the purpose of funding such obligations.
Such trust shall be in a form that provides Executive with the most favorable
tax position that reasonably can be determined at the time it is established.
The trust shall provide for distribution of amounts to Executive in order to pay
taxes, if any, that become due prior to payment of amounts pursuant to the
trust. Following the occurrence of a Change in Control, the Company shall make
periodic additional contributions (no less frequently than annually) to keep
such trust fully funded. The intent is that no later than the Change in Control
and annually thereafter (the "Applicable Dates") the amount of such fund shall
equal at least the then present value (determined as of each Applicable Date) of
any amounts subject to the funding requirement of this Section 4(b) as
determined by a nationally recognized firm qualified to provide actuarial
services. The establishment and funding of any such trust shall not affect the
obligation of the Company to provide the benefits being funded. The trust may be
terminated in accordance with the trust agreement between the Company and the
trustee and, if so terminated, the Company shall not be required to establish a
successor trust under this Section 4(b). The trust described in this Section
4(b) may be part of a trust funding similar obligations for other employees of
the Company.
(c) No later than the occurrence of a Change in Control, the
Company shall fund its obligations to provide payments and benefits under this
Agreement (other than the
7
7
obligations which are provided for in Section 4(b)) by the establishment of
a trust to which it contributes an amount sufficient to meet such obligations.
The establishment and funding of such trust shall not affect the obligations of
the Company to provide the benefits subject to this Section 4(c). The trust
described in this Section 4(c) may be part of the trust described in Section
4(b).
(d) The consequences of a Change in Control upon compensation
and benefit plans and programs of the Company, except as otherwise provided in
this Agreement, shall be determined in accordance with such plans and programs.
5. Parachute Payment Limitations.
------------------------------
Anything in this Agreement to the contrary, if the aggregate of the
amounts due the Executive under this Agreement and any other plan or
program of the Company constitutes a "Parachute Payment," as such term is
defined in Section 280G of the Internal Revenue Code of 1986 (the "Code"), and
the amount of the Parachute Payment, reduced by all Federal, state and local
taxes applicable thereto, including the excise tax imposed pursuant to Section
4999 of the Code, is less than the amount the Executive would receive, after
taxes, if he received a Parachute Payment equal to only three times his Base
Amount, as defined in Section 280G(b)(3) of the Code, less $1.00, then the
amounts due the Executive under this Agreement that are "contingent on a Change
in Control" (as defined in the next sentence) shall be reduced so that the
aggregate of
(i) the amounts due the Executive under this Agreement that are
"contingent on a Change in Control"
plus
(ii) the other amounts due the Executive, under other plans and
programs of the Company, that are "contingent on a Change in Control"
equals three times his Base Amount less $1.00. For purposes of the preceding
sentence "contingent on a Change in Control" shall have the same meaning as
given that term in Section 280G(b)(2)(A)(i) of the Code. The determinations to
be made with respect to this paragraph shall be made by the public accounting
firm that is retained by the Company as of the date immediately prior to the
Change in Control (the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and Executive within fifteen (15)
business days of being requested to do so by the Company or Executive. In the
event that the Accounting Firm is serving as accountant or auditor for the
individual, entity or group effecting the Change in Control, Executive shall
appoint another nationally recognized public accounting firm to make the
determinations required hereunder (which accounting firm shall then be referred
to as the Accounting Firm hereunder). All fees and expenses of the Accounting
Firm shall be borne solely by the Company.
6. Confidentiality.
----------------
(a) During employment and thereafter, Executive shall keep
confidential all "Confidential Information" relating to the Company or any
of its subsidiaries, and their respective businesses, obtained by Executive
during his employment by the Company or any of its subsidiaries. "Confidential
Information" means any non-public, proprietary
8
8
information that may provide the Company with a competitive advantage,
including, without limitation, any trade secrets, formulas, flow charts,
computer programs, access codes or other systems information, business, product
or marketing plans, sales and other forecasts, financial information, customer
lists, and information relating to compensation and benefits, provided that such
proprietary information does not include any information which is available to
the general public or is generally available within the relevant business or
industry other than as a result of Executive's breach of this Section 6(a).
Confidential Information may be in any medium or form, including, without
limitation, physical documents, computer files or discs, videotapes, audiotapes,
and oral communications. Anything herein to the contrary notwithstanding, it
shall not be a violation of this Section 6(a) for the Executive to disclose
information in the ordinary course of properly carrying out his duties and
responsibilities on behalf of the Company or to respond to an order of a court
or other body having jurisdiction provided that he gives the Company notice of
any such order.
(b) Except as expressly provided herein, promptly following
Executive's termination of employment, Executive shall return to the
Company all property of the Company then in Executive's possession or under his
control, except that Executive may retain his personal notes, diaries,
Rolodexes, calendars and correspondence.
(c) Executive agrees that any material breach of the terms of this
Section would result in irreparable injury and damage to the Company for
which the Company would have no adequate remedy at law. Executive further agrees
that in the event of said material breach or any reasonable threat of material
breach, the Company shall be entitled to an immediate injunction and restraining
order to prevent such material breach or threatened material breach. The terms
of this paragraph shall not prevent the Company from pursuing any other
available remedies for any breach or threatened breach hereof, including but not
limited to the recovery of damages. Should a court or arbitrator determine that
any provision of this Section 6 is unreasonable, the parties agree that such
provision shall be interpreted and enforced to the maximum extent such court or
arbitrator deems reasonable.
(d) The provisions of this Section shall survive any termination
of this Agreement and the Transition Period, and the existence of any claim
or cause of action by Executive against the Company, whether predicated on this
Agreement or otherwise, shall not constitute a defense to the enforcement by the
Company of the covenants and agreements of this Section.
7. Indemnification.
----------------
The Company agrees that if Executive is made a party to any action,
suit or proceeding, whether civil, criminal, administrative or
investigative (a "Proceeding"), by reason of the fact that he is or was a
director, officer or employee of the Company, Executive shall be indemnified and
held harmless by the Company to the fullest extent legally permitted or
authorized by the Company's Second Amended Articles of Incorporation, Restated
Amended Code of Regulations, Indemnification Agreement between Executive and the
Company or, if greater, by the laws of the State of Ohio, against all cost,
expense, liability and loss (including, without limitation, attorney's fees,
judgments, fines, ERISA excise taxes or penalties and amounts paid or to be paid
in settlement) reasonably incurred or suffered by Executive in connection
therewith. The Company agrees to continue and maintain a directors' and
officers' liability insurance policy covering Executive to the extent the
Company provides such coverage for its other executive officers.
9
9
8. Withholding Taxes.
-----------------
The Company may withhold from all payments due to Executive (or his
beneficiary or estate) hereunder all taxes which, by applicable federal,
state, local or other law, the Company is required to withhold therefrom.
9. Reimbursement of Expenses.
--------------------------
If any contest or dispute shall arise under this Agreement
involving termination of Executive's employment with the Company or involving
the failure or refusal of the Company to perform fully in accordance with
the terms hereof, the Company shall reimburse Executive, on a current basis,
for all legal fees and expenses, if any, incurred by Executive in connection
with such contest or dispute regardless of the result thereof.
10. Scope of Agreement.
-------------------
Nothing in this Agreement shall be deemed to entitle Executive to
continued employment with the Company or its subsidiaries.
11. Successors; Binding Agreement.
-----------------------------
(a) This Agreement shall not be terminated by any merger or
consolidation of the Company whereby the Company is or is not the surviving
or resulting corporation or as a result of any transfer of all or substantially
all of the assets of the Company. In the event of any such merger, consolidation
or transfer of assets, the provisions of this Agreement shall be binding upon
the surviving or resulting corporation or the person or entity to which such
assets are transferred.
(b) The Company agrees that concurrently with any merger,
consolidation or transfer of assets referred to in paragraph (a) of this
Section 11, it will cause any successor or transferee unconditionally to assume,
by written instrument delivered to Executive (or his beneficiary or estate), all
of the obligations of the Company hereunder.
(c) (i) No rights or obligations of the Company under this
Agreement may be assigned or transferred by the Company except that such
rights or obligations may be assigned or transferred pursuant to a merger or
consolidation in which the Company is not the continuing entity, or in
connection with the sale or liquidation of all or substantially all of the
assets of the Company, or in connection with the disposition of the business of
the Company substantially as an entirety, provided that the assignee or
transferee is the successor to all or substantially all of the assets of the
Company and such assignee or transferee assumes the liabilities, obligations and
duties of the Company under this Agreement, either contractually or as a matter
of law.
(ii) This Agreement is personal to Executive and,
without the prior written consent of the Company, shall not be assignable
by Executive otherwise than by will or the laws of descent and distribution.
This Agreement shall inure to the benefit of and be enforceable by Executive's
personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees. If Executive shall die while any amounts
would be payable to Executive hereunder had Executive continued to live, all
such amounts, unless otherwise provided herein, shall be paid in accordance with
the terms of this Agreement to
10
10
such person or persons appointed in writing by Executive to receive such
amounts or, if no person is so appointed, to Executive's estate.
12. Notice.
-------
(a) For purposes of this Agreement, all notices and
other communications required or permitted hereunder shall be in writing
and shall be deemed to have been duly given when delivered or five (5) days
after deposit in the United States mail, certified and return receipt requested,
postage prepaid, addressed as follows:
If to Executive:
[Executive's Name and Address]
If to the Company:
General Counsel
Caliber System, Inc.
X.X. Xxx 0000
Xxxxx, XX 00000-0000
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
(b) A written notice (a "Notice of Termination") of
Executive's Date of Termination by the Company or Executive, as the case
may be, to the other, shall (i) indicate the specific termination provision in
this Agreement relied upon, (ii) to the extent applicable, set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of Executive's employment under the provision so indicated and (iii)
specify the termination date. The failure by Executive or the Company to set
forth in such notice any fact or circumstance which contributes to a showing of
Good Reason or Cause shall not waive any right of Executive or the Company
hereunder or preclude Executive or the Company from asserting such fact or
circumstance in enforcing Executive's or the Company's rights hereunder.
13. No Set-off; No Mitigation.
--------------------------
The Company's obligation to make any payments provided for
in this Agreement and otherwise to perform its obligations hereunder shall
not be affected by any set-off, counterclaim, recoupment, defense or other
claim, right or action which the Company may have against Executive or others.
In no event shall Executive be obligated to seek other employment or take other
action by way of mitigation of the amounts payable to Executive under any of the
provisions of this Agreement and such amounts shall not be reduced whether or
not Executive obtains other employment.
14. Employment with Subsidiaries.
----------------------------
Employment with the Company for purposes of this Agreement
shall include employment with any corporation or other entity in which the
Company has a direct or indirect ownership interest of 50% or more of the total
combined voting power of the then
11
11
outstanding securities of such corporation or other entity entitled to vote
generally in the election of directors.
15. Governing Law; Validity.
------------------------
The interpretation, construction and performance of this
Agreement shall be governed by and construed and enforced in accordance
with the internal laws of the State of Ohio without regard to the principle of
conflicts of laws. 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 other provisions shall remain in full force and effect.
16. Settlement of Disputes.
----------------------
(a) Any controversy or claim arising out of or relating
to this Agreement, any amendment of this Agreement, or any breach of any of
the foregoing, shall, subject to the mutual agreement of the Company and the
Executive, be settled by confidential arbitration, to be held in Akron, Ohio, in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association before three (3) arbitrators. The arbitrators shall apply the
provisions of this Agreement strictly as written (unless doing so violates the
clear intent of this Agreement), and shall explain the reasons and basis of
their award in detail and in writing. Judgment upon the award rendered by the
arbitrators may be entered in any court having jurisdiction thereof. All costs
and expenses relating to any controversy or claim that is arbitrable under this
Section (including reasonable attorney's fees of the Executive) shall be paid by
the Company promptly on written demand, except that the arbitrators are
authorized to require reimbursement of the Company for moneys paid by it
pursuant to this sentence if the arbitrators determine that the substantive
positions of the Executive in the arbitration were entirely without merit.
Pending final resolution of any arbitration or court proceeding, the Company
shall continue prompt payment of all amounts due the Executive under this
Agreement or any amendment thereof and prompt provision of all benefits to which
the Executive or his beneficiaries are entitled. Notwithstanding the foregoing,
nothing contained in this Section 16 shall limit a party's right to seek
equitable relief in any court of competent jurisdiction.
(b) In the event the parties do not agree to
arbitration as provided in 16(a), the parties hereby consent to the
jurisdiction of the Common Pleas Court of the State of Ohio (Summit County) or
of the United States District Court for the Northern District of Ohio.
17. Counterparts.
-------------
This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original and all of which together shall
constitute one and the same instrument.
18. Survivorship.
-------------
The respective rights and obligations of the parties
hereunder shall survive the expiration of the term of this Agreement, to the
extent necessary to carry out the intentions of the parties, including without
limitation any obligations of the Company to make payments and provide benefits
hereunder.
12
12
19. Miscellaneous.
--------------
No provision in this Agreement may be amended unless
such amendment is agreed to in writing and signed by Executive and an
authorized officer of the Company. No provision of this Agreement may be waived
unless such waiver is agreed to in writing and signed by the waiving party
which, in the case of the Company, shall mean by a duly authorized officer of
the Company. 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 at any prior or
subsequent time. Failure by Executive or the Company to insist upon strict
compliance with any provision of this Agreement or to assert any right Executive
or the Company may have hereunder, including without limitation, the right of
Executive to terminate employment for Good Reason, shall not be deemed to be a
waiver of such provision or right or any other provision or right of this
Agreement. This Agreement contains the entire understanding and agreement
between the parties concerning the subject matter hereof and supersedes all
prior agreements, understandings, discussions, negotiations and undertakings,
whether written or oral, between the parties with respect thereto.
13
13
IN WITNESS WHEREOF, the Company has caused this Agreement to
be executed by a duly authorized officer of the Company. Executive has executed
this Agreement as of the date and year first written above.
CALIBER SYSTEM, INC.
By:
----------------------------
Agreed to this day of March, 1997.
-----
--------------------------
[Executive's Name]
