EXHIBIT 10.33
[LETTERHEAD OF CALCOMP]
April 1, 1998
Xx. Xxxxx X. Xxxx
Xx. Vice President and General Manager
Input Technologies Division
RE: CALCOMP TECHNOLOGY, INC. - CHANGE OF CONTROL
TERMINATION BENEFIT AGREEMENT
Dear Xxx:
CalComp Technology, Inc. ("CalComp") is a publicly held corporation. Lockheed
Xxxxxx Corporation ("Lockheed Xxxxxx") currently owns more than 50% of the
voting securities of CalComp. If at any future time Lockheed Xxxxxx, one or
more subsidiaries of Lockheed Xxxxxx, or a combination thereof ceases to own or
control (directly or indirectly) more than 50% of the voting securities of
CalComp, or if the Input Technologies Division is sold, then, for the purposes
of this letter a "change of control" of CalComp shall be deemed to have
occurred. The term "voting securities" shall mean securities able to vote for
directors or securities convertible into or exchangeable or exercisable for
securities able to vote for directors.
We understand that the prospect of a change of control may trouble you, but as a
key and valued employee we want you to remain with the Company to help keep the
Company running properly. That is why we are offering you the benefits
described in this agreement.
If a change of control occurs and if within 18 months from the date of the
change of control (1) you are involuntarily terminated by the Company or any
successor owner (except for terminations for cause) or; (2) you are removed from
the position held immediately prior to the change and the effect is a material
reduction of status, responsibilities or duties and you then terminate your
employment within 60 days after having your status reduced or; (3) your base
salary in effect at the time of the change of control is reduced, and you then
terminate your employment within 60 days after having your salary reduced, then
you will be eligible to receive the benefits described below. No other
severance or similar benefits will be paid to you.
1. SEVERANCE BENEFIT
You will be eligible for a lump-sum severance payment determined under the
following formula: an amount equal to one and a half (1 1/2) years' annual base
salary immediately prior to the change of control plus an amount equal to one
year's Management Incentive Compensation Plan Award at your target level, all
less statutory deductions but excluding voluntary deductions, such as for
savings plans. (Example: If your salary is $100,000 and your target is 20%, you
will receive $150,000 + $20,000 for a total of $170,000, less withholdings).
2. ACCRUED VACATION BENEFIT
You will be eligible for a lump-sum cash payment, if applicable, for any
vacation earned but not taken through the Effective Date of termination.
XXXXX X. XXXX
APRIL 1, 1998
PAGE 2
3. OUTPLACEMENT
You also will receive outplacement assistance from a firm selected by the
Company. This assistance will include: (1) group job search and training by a
professional outplacement firm; and (2) resume preparation and secretarial
assistance. Cost not to exceed $20,000.00.
4. MEDICAL/DENTAL COVERAGE
You will be eligible for up to 18 months' continuation of your current
medical/dental coverage in accordance with the Company's customary COBRA
procedures. As part of your benefits, the Company will, at no charge to you,
continue your medical/dental coverage, including coverage for your dependents,
for the first 12 months following the date your employment with the Company ends
or, if earlier, until you become eligible for coverage under a health plan of
another employer. Alternatively, a lump sum payment can be made in lieu of
continuation of benefits coverage.
5. ADDITIONAL PAYMENT TO SUPPLEMENT LOSS OF PENSION EARNINGS
If a change in control occurs, we understand your participation in the Pension
Plan could cease and the pension you will be entitled to receive will be less
than what you had expected if you had remained a participant through age 60. To
address this issue, we will pay you an additional payment of $52,593.24, which
is taxable.
6. AMENDMENTS
The Company has the right to modify any of the terms set forth in this letter to
clarify unclear provisions or remedy omissions, but it will not make any change
that it determines would materially reduce the value of the benefits offered to
you under this letter.
Thank you in advance for your continued service.
Sincerely,
/s/ Xxxx X. Xxxxxxxxx
Xxxx X. Xxxxxxxxx
President and CEO
ACCEPTED:
/s/ Xxxxx Xxxx
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Xxxxx Xxxx
