ARMOR HOLDINGS, INC.
0000 Xxxxx Xxxxxxx Xxxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
July 26, 2003
Xx. Xxxxxx X. Xxxxxxx
Two Xxxxxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Dear Xxxxxx:
This letter agreement will amend the letter agreement (the
"Employment Letter") dated as of January 1, 2002 between you and Armor Holdings,
Inc. (the "Company"). Capitalized terms not otherwise defined herein shall have
the meanings ascribed to them in the Employment Letter. Except as expressly
modified by this letter agreement, the Employment Letter shall remain in full
force and effect.
For the remainder of the Term, Kanders shall, in addition to the duties
set forth in the Employment Letter, serve as the Chief Executive Officer of the
Company and shall perform all duties commensurate with his position and as may
be assigned to him by the Board of Directors of the Company and subject to the
control of the Board of Directors of the Company.
Effective as of April 9, 2003, the Company shall pay to Kanders, and
Kanders shall accept from the Company, as compensation for the performance of
services under this letter agreement and the Employment Letter, a salary of
$525,000 per year (the "Base Compensation"). The Base Compensation shall be
payable in accordance with the normal payroll practices of the Company and shall
be subject to withholding for applicable taxes and other amounts. In addition to
the Base Compensation, the Employee may, in the sole and absolute discretion of
the Compensation Committee of the Board of Directors of the Company, be entitled
to incentive compensation which may, among other things, be based upon the
Company's performance and the Employee's performance, all as determined in the
sole and absolute discretion of the Compensation Committee of the Board of
Directors of the Company. Upon the termination of the Employment Letter by
Xxxxxxx due to the occurrence of a "change in control", or upon the termination
of the Employment Letter by the Company pursuant to Section 8(d) thereof,
Kanders shall be entitled to receive, in one lump sum, within 5 business days of
the occurrence of such "change in control" or termination by the Company
pursuant to Section 8(d), as the case may be, the greater of (i) his Base
Compensation to the end of the Term, or (ii) twice the Employee's annual Base
Compensation (any such payment is referred to as the "Termination Payment"), and
such Termination Payment shall be subject to withholding for applicable taxes
and other amounts. Notwithstanding anything to the contrary contained herein, in
the event that Xxxxxxx has breached his obligations under Sections 5 or 6 of the
Employment Letter, then Xxxxxxx shall immediately repay to the Company the full
amount of the gross Termination Payment before taking into account any
withholdings for applicable taxes and other amounts.
Xx. Xxxxxx X. Xxxxxxx
July 26, 2003
Page 2
In addition to the compensation set forth above, effective as of the
date hereof for the remainder of the Term, the Company shall provide Kanders
with a non-accountable supplemental benefit allowance equal to 7.5% of Base
Compensation per year.
In addition to the foregoing, Kanders shall be entitled to receive (i)
a stock grant of 200,000 shares of the Company's Common Stock, 66,666 shares of
which shall vest on the date the closing price of the Company's Common Stock on
the New York Stock Exchange (or such other stock market or exchange as the
Common Stock shall then be traded on) shall equal $20 per share or more;
provided, that, such $20 price per share is attained within three years of the
date hereof, and maintained for five consecutive trading days, and the remaining
shares shall vest in 24 equal monthly installments following such date, and (ii)
options to purchase 300,000 shares of the Company's Common Stock at an exercise
price of $14.32 per share, the closing price of the Company's Common Stock on
Friday, July 25, 2003, which shall vest in three annual installments of 100,000
shares commencing on the first anniversary of the date hereof, each of the above
to be subject to the terms and conditions of Section 4 of the Employment Letter
applicable to the awards described therein and which awards shall be upon the
terms and conditions as more fully set forth in a separate agreement between the
Company and Kanders.
If you are in agreement with the foregoing, please so indicate by
signing in the space indicated below and returning a fully executed copy of this
letter to us.
Very truly yours,
ARMOR HOLDINGS, INC.
By:
----------------------
Name:
Title:
ABOVE AGREED TO AND ACCEPTED:
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Xxxxxx X. Xxxxxxx
