EXHIBIT 10(z)
AMENDMENT TO AND EXTENSION OF EMPLOYMENT AGREEMENT
BETWEEN XXXXX XXXXXXXX INTERNATIONAL, INC.
AND XXXXXXX X. XXXXXX
This AMENDMENT AND EXTENSION, dated as of April 1, 1998, is by and between
XXXXX XXXXXXXX CORPORATION, a Delaware corporation (the "Company"), and XXXXXXX
X. XXXXXX (the "Executive"), and amends and extends the EMPLOYMENT AGREEMENT,
dated April 10, 1992, between the Company (f/k/a Xxxxxxxx International, Inc.)
and the Executive (as previously amended and extended, the "Employment
Agreement").
WHEREAS, the Company and the Executive have agreed to amend and extend the
Employment Agreement in accordance with the terms hereof.
NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the parties hereto hereby agree as follows:
1. Section 1 of the Employment Agreement is hereby amended to read as
follows:
1. Term of Employment. The Executive's period of employment
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hereunder shall extend from April 10, 1992 through April 10,
2001; provided, however, that commencing April 10, 1999 and each
April 10 thereafter if this Agreement is still in effect, the
period of employment shall automatically be extended for one
additional year unless, not later than March 1 of such year, the
Company or the Executive has given written notice to the other
party that such term of employment shall not be so extended. The
period of Executive's employment hereunder, including any
extension or extensions pursuant to the foregoing sentence, is
referred to hereafter as the "Employment Term."
2. The first sentence of Section 2 of the Employment Agreement is hereby
amended to read as follows: While employed hereunder, Executive shall
serve as Senior Vice President, Corporate Development and Investor
Relations of the Company.
3. The lead-in paragraph of Section 7(d) of the Employment Agreement is
hereby amended to read as follows:
(d) Subject to Section 7(g), if during the Employment Term and prior
to a Change in Control Executive's employment hereunder is
terminated by the Company without Cause (other than by reason of
death or
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Disability) or by Executive with "Good Reason" (as defined in
Section 7(e) below) asserted in a Notice of Termination pursuant
to Section 13(f) within one year of the event alleged to
constitute such Good Reason, Executive shall be entitled to
receive the following benefits:
4. Section 7(d)(i) of the Employment Agreement is hereby amended to read
as follows:
(i) The Company shall pay Executive in equal monthly cash payments,
beginning on the fifth day of the month following such termination and
continuing on the fifth day of each month thereafter for a period of
24 months, an aggregate amount equal to two times Executive's Base
Salary in effect at the time of such termination or, in the event of
termination by Executive on account of an event described in Section
7(e)(iv) below, the Base Salary as in effect prior to the reduction or
reductions referred to therein plus the bonus Executive would have
earned in respect of the year of termination under the Company's
annual incentive compensation plan, if any, in effect at the date of
termination or, in the event of a termination by Executive by reason
of an event described in Section 7(e)(vi), the plan in effect prior to
the elimination referred to therein, determined as if Executive had
been employed by the Company for the full year and without regard to
any right reserved by the Company to decrease or eliminate such bonus,
and assuming actual performance had equaled 100% of the performance
objective established for such year pursuant to the terms of such
plan. In the event of a Change in Control following such termination,
all remaining amounts then payable pursuant to this Section 7(d)(i)
shall be paid in a lump sum in cash within 15 days of the date of the
event giving rise to the Change in Control.
5. The Employment Agreement is hereby amended to add a new Section 7(g)
and (h) to read as follows:
(g) Notwithstanding any other provision of this Agreement, in
the event (i) Executive's employment hereunder is terminated by
the Company without Cause prior to a Change in Control pursuant
to which payments are payable pursuant to Section 7(d) and (ii)
such termination is the result of a Performance Related
Termination Event (as defined in Section 7(g) below), then (x)
the benefits and perquisites provided pursuant to Sections
7(d)(ii) and 7(d)(iii) shall be provided for a 12-month period
after such termination in lieu of a 24-month period, (y) the
benefits and services provided pursuant to Sections 7(d)(iv) and
7(d)(v) shall remain unchanged and (z) the amount payable
pursuant to Section 7(d)(i) shall be reduced to the amount
provided in Section 7(g)(i) below:
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(i) The Company shall pay Executive in equal monthly cash
payments beginning on the fifth day of the month
following such termination and continuing on the fifth
day of each month thereafter for a period of 24 months,
an aggregate cash amount equal to one times his Base
Salary in effect at the time of such termination plus a
fraction of the annual bonus which (absent such
termination and without regard to any right reserved by
the Company to decrease or eliminate such bonus)
Executive would have earned in respect of the year of
termination under the JM annual incentive compensation
plan, if any, in effect at the date of termination,
assuming actual performance had equaled 100% of the
performance objective established for such year
pursuant to the terms of such plan, the numerator of
which fraction is the number of days in such year
during which the Executive was employed by the Company
and the denominator of which is 365.
(h) For purposes of the foregoing, "Performance Related
Termination Event" shall mean Executive's failure to meet in
any material respect the expectations of the Company which
have been communicated to Executive and which are reasonable
and material in light of Executive's position after a
written notice specifying this Section and identifying such
failure is delivered to Executive and Executive shall have
failed during the 60-day period following such written
demand to have corrected such failure (other than as a
result of total or partial incapacity due to physical or
mental illness or as a result of termination by Executive
for Good Reason).
6. The lead-in paragraph of Section 8(d) of the Employment Agreement
is hereby amended to read as follows:
(d) If during the Employment Term Executive's employment
hereunder is terminated by the Company following a Change in
Control without Cause (other than by reason of death or
Disability) or by Executive with "Good Reason" (which following a
Change in Control shall have the meaning set forth in Section
8(e) below) asserted in a Notice of Termination pursuant to
Section 13(f) within two years of the event alleged to constitute
such Good Reason, Executive shall be entitled to receive the
following benefits:
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7. Section 8(d)(i) of the Employment Agreement is hereby amended to
read as follows:
(i) The Company shall pay Executive at the time of termination
in a lump sum a cash amount equal to three times the sum of (A)
Executive's Base Salary in effect at the time of such termination
or, in the event of termination by Executive by reason of an
event described in Section 8(e)(iv) below, the Base Salary as in
effect prior to the reduction or reductions referred to therein
plus (B) the bonus Executive would have earned in respect of the
year of termination under the Company's annual incentive
compensation plan, if any, in effect at the date of termination
or, in the event of a termination by Executive by reason of an
event described in Section 8(e)(v), the plan in effect
immediately prior to the reduction or reductions referred to
therein, determined as if Executive had been employed by the
Company for the full year and without regard to any right
reserved by the Company to decrease or eliminate such bonus, and
assuming actual performance had equaled 100% of the performance
objective established for such year pursuant to the terms of such
plan.
8. Section 9 of the Employment Agreement is hereby amended to read
as follows:
9. Golden Parachute Tax.
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(a) Anything herein to the contrary notwithstanding, in the
event that it is determined that any payment or distribution
by the Company to or for Executive's benefit, whether paid
or payable or distributed or distributable pursuant to the
terms hereof or otherwise, other than any payment pursuant
to this Section 9(a) (a "Payment"), would be subject to the
excise tax imposed by Section 4999 of the Internal Revenue
Code of 1986, as amended (the "Code") or any interest or
penalties with respect to such excise tax (such excise tax,
together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise Tax"),
then Executive shall be entitled to receive, within 15 days
following the determination described in Section 9(b) below,
an additional payment ("Excise Tax Adjustment Payment") in
an amount such that after payment by Executive of all
applicable Federal, state and local taxes (computed at the
maximum marginal rates and including any interest or
penalties imposed with respect to such taxes), including any
Excise Tax, imposed upon the Excise Tax Adjustment Payment,
Executive shall retain an amount of the Excise Tax
Adjustment Payment equal to the Excise Tax imposed upon the
payments.
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(b) All determinations required to be made under this
Section 9, including whether an Excise Tax Adjustment
Payment is required and the amount of such Excise Tax
Adjustment Payment, shall be made by Coopers & Xxxxxxx,
L.L.P. or such accounting firm as the Company may designate
prior to a Change of Control, which shall provide to the
Company and Executive detailed supporting calculations
within 15 business days of the date of Executive's
termination of Employment. Except as hereinafter provided,
any determination by Coopers & Xxxxxxx, L.L.P. or such other
accounting firm as the Company may designate prior to a
Change of Control shall be binding upon the Company and
Executive. As a result of the uncertainty in the application
of Section 4999 of the Code at the time of the initial
determination hereunder, it is possible that (x) Excise Tax
Adjustment Payments which should have been made will not
have been made by the Company ("Underpayment"), or (y)
certain Excise Tax Adjustment Payments will have been made
which should not have been made ("Overpayment"), consistent
with the calculations required to be made hereunder. In the
event of an Underpayment, the Company shall promptly
determine the amount of the Underpayment that has occurred
and any such Underpayment shall be promptly paid by the
Company to or for Executive's benefit. In the event that
Executive discovers that an Overpayment shall have occurred,
the amount thereof shall be promptly repaid to the Employer.
9. The Employment Agreement is hereby amended to add, immediately
prior to the first sentence of Section 13(d), the following:
It is expressly understood and agreed that although Executive and
the Company consider the restrictions contained in this Agreement
to be reasonable, if a final judicial determination is made by a
tribunal of competent jurisdiction that the time or territory or
any other restriction contained in this Agreement is an
unenforceable restriction against Executive, the provisions of
this Agreement shall not be rendered void but shall be deemed
amended to apply to such maximum time and territory and to such
maximum extent as such tribunal may determine or indicate to be
enforceable.
10. The Employment Agreement is hereby amended to add a new Section
13(i), (j) and (k) to read as follows:
(i) Non-Disparagement. Executive and the Company shall each use
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all reasonable efforts not to make any statements or take
any action that may be derogatory or disparaging to the
reputation of the other or, in the case of the Executive, to
the reputation of any of the Company's
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affiliates. Notwithstanding the foregoing, nothing in this
Agreement shall preclude either party from truthful
statements or disclosures that are required by applicable
law or regulation, or from taking any position in
prosecuting or defending any judicial, administrative or
arbitration proceeding arising hereunder.
(j) Cooperation. Executive agrees that following termination of
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Executive's employment with the Company prior to a Change in
Control for a period ending on the earlier to occur of the
fifth anniversary of such termination or a Change in
Control, Executive shall make himself reasonably available
to the Company and its legal counsel, taking into
consideration Executive's other obligations, and shall
cooperate with the Company in connection with any
litigation, investigation or other proceeding relating to
events occurring during Executive's employment hereunder or
facts as to which he has knowledge; provided that Executive
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shall be entitled to reimbursement of necessary and
reasonable expenses incurred in connection therewith subject
to provision of receipts therefor and provided further that
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(i) nothing herein shall require Executive to make any but
truthful statements and (ii) Executive will not be required
so to cooperate to the extent his position is in conflict
with that of the Company.
(k) Non-Competition/Non-Solicitation. (i) Executive acknowledges
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and recognizes the highly competitive nature of the business
of the Company and its affiliates and accordingly hereby
agrees, in consideration of the agreements herein of the
Company, that from the date hereof through the termination
of Executive's employment with the Company and, if such
termination occurs prior to a Change in Control, through the
two year period following such termination of Executive's
employment, (x) Executive shall not alone, or as a partner,
member, employee, agent, director, stockholder or investor
of any corporation or other business entity or in any other
individual or representative capacity, directly or
indirectly, own, manage, operate or control, or participate
in the ownership, management, operation or control of, or
work or provide consulting services to (including, without
limitation, without receiving a fee or other compensation),
or lend money to, any business, activity or person which
competes with a business or activity in North America,
Europe and Asia in which the Company is engaged or in which
the Company or its affiliates is actively and seriously
considering engaging at the time in question in the case of
conduct during such employment or at the time of Executive's
termination of employment in the case of conduct during such
two year period; provided the foregoing shall not prohibit
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Executive from directly or indirectly making passive
investments of not more than one percent (1%) of the
outstanding equity interests in, or
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public debt of, any company or entity listed or traded on a
national securities exchange or an over the counter
securities market and (y) Executive shall not, directly or
indirectly, recruit, seek to recruit, or hire any present or
former employee of the Company or any of its subsidiaries
(level 30 or above) until at least one year has passed from
the date of termination of such person's employment with the
company or any of its subsidiaries.
(ii) Executive hereby acknowledges that the business of
the Company and its affiliates is international in scope and
that, accordingly, any geographical limitation on the scope
of the foregoing covenant to less than that specified
therein could be meaningless, and that, by reason thereof,
Executive acknowledges that the scope of the foregoing
covenant is reasonable and necessary in order to protect the
interests of the Company and its affiliates sought to be
protected hereby.
(iii) The parties acknowledge and agree that their
respective remedies for a breach or threatened breach of any
of the provisions of Section 13 (i), (j) or (k) would be
inadequate and, in recognition of this fact, the parties
agree that, in the event of such a breach or threatened
breach, in addition to any remedies at law, the aggrieved
party, without posting any bond, shall be entitled to obtain
equitable relief in the form of specific performance,
temporary restraining order, temporary or permanent
injunction or any other equitable remedy which may then be
available.
11. Except as provided by this Amendment, the Employment Agreement
shall remain in full force and effect.
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IN WITNESS WHEREOF, the parties have executed this Amendment to be
effective as of April 1, 1998.
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
XXXXX XXXXXXXX CORPORATION
/s/ X. X. Xxxxx
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X.X. Xxxxx
Chairman, Chief Executive Officer
and President
ATTEST:
/s/ Xxxxxxx X. Xxx Xxxx
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Xxxxxxx X. Xxx Xxxx
Executive Vice President,
General Counsel and Secretary
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