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Exhibit 3
FORM OF
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (the "Agreement"), dated as of November 20, 1997,
but effective as provided herein, is made and entered into by and between TRW,
Inc., an Ohio corporation (the "Company" or "TRW", as the context requires), and
__________________ (the "Executive").
WHEREAS, the Executive has been serving as the President/CEO of BDM
International, Inc. ("Banneker"), a Delaware corporation;
WHEREAS, pursuant to the Agreement and Plan of Merger (the "Merger
Agreement") among the Company, Systems Acquisition Inc., a wholly owned
subsidiary of the Company ("Merger Sub"), and Banneker (the "Merger Agreement"),
as of the effective time of the Merger (the "Effective Time"), Merger Sub will
be merged with and into Banneker, with Banneker as the surviving entity (the
"Merger");
WHEREAS, pursuant to the Merger Agreement it is contemplated that Executive
will execute this Agreement upon the signing of the Merger Agreement and, upon
the date of the consummation of the Offer, as defined in the Merger Agreement
(the "Closing Date"), Executive will serve in the employ of the Company or a
subsidiary of the Company ("Company" as used herein will mean the Company or a
subsidiary of the Company);
WHEREAS, the Company considers it in the best interests of its stockholders
to xxxxxx the continuous employment of certain key management personnel of
Banneker;
WHEREAS, the Company wishes to assure itself of both present and future
continuation of management in light of the Merger;
WHEREAS, the Company wishes to employ the Executive and the Executive is
willing to render services, both on the terms and subject to the conditions set
forth in this Agreement;
NOW, THEREFORE, in consideration of the promises and of the mutual
covenants herein contained, it is agreed as follows:
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1. Employment
1.1 The Company hereby agrees to continue to employ the Executive, and
the Executive hereby agrees to continue employment with the Company, upon the
terms and conditions herein set forth.
1.2 Employment will continue for a term commencing on the Closing Date
and, subject to earlier expiration upon the Executive's termination under
Section 3, expiring on the third anniversary of the Closing Date (the
"Employment Term").
1.3 Duties. During the Employment Term, the Executive will be the
Company's full-time employee in a position requiring the Executive to provide
services of a similar character to those provided by the Executive to Banneker
immediately prior to the date hereof. The Executive will devote all of his
business time and attention to the performance of his duties to the Company.
Notwithstanding the foregoing, the Executive may, (i) subject to the approval of
the Company, serve as a director of a company which is not engaged in
"Competition" (as defined in Section 5.1) with the Company, (ii) serve as an
officer, director or otherwise participate in purely educational, welfare,
social, religious and civic organizations, and (iii) manage personal and family
investments.
2. Compensation and Related Matters.
2.1 Compensation and Benefits.
(i) Annual Base Salary. Executive will receive an annual base salary
of not less than his annual base salary in effect immediately prior to the
Effective Time. In the event that the Executive relocates his location of
principal employment at the request of the Company, the Company will in good
faith consider a cost of living adjustment to annual base salary. Annual base
salary and merit increases to such salary will be payable at the times and in
the manner consistent with Banneker's general policies regarding compensation of
executive employees.
(ii) Annual Incentive Compensation. Executive will be eligible to
receive annual incentive compensation based on incentive target percentages of
base salary comparable to such percentages in effect immediately prior to the
Effective Time. Nothing in this Section 2.1(ii) will guarantee to the Executive
any specific amount of incentive compensation, or prevent the Board from
establishing performance goals and compensation targets applicable to the
Executive.
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2.2 Executive Benefits. In addition to the compensation described in
Section 2.1, the Executive and his eligible dependents during the Employment
Term will be entitled to participate in employee benefit plans currently offered
by Banneker, including without limitation supplemental retirement plans,
executive life insurance and executive deferred compensation plans, provided
however that the Company reserves the right to provide comparable benefits under
new or substituted benefit plans.
2.3 Expenses. The Company will promptly reimburse the Executive for all
travel and other business expenses the Executive incurs in order to perform his
duties to the Company under this Agreement in a manner commensurate with the
Executive's position and level of responsibility with the Company, and in
accordance with the Company's policy regarding expenses.
3. Termination. Notwithstanding the Employment Term specified in Section
1.2, the termination of the Executive's employment hereunder will be governed by
the following provisions:
3.1 Cause
(i) The Company may terminate the Executive's employment hereunder
for Cause (as defined below). In the event of the Executive's termination for
Cause, the Company will promptly pay to the Executive (or his representative)
the unpaid annual base salary to which he is entitled, pursuant to Section 2.1,
through the date the Executive is terminated and the Executive will be entitled
to no other compensation, except as otherwise due to him under applicable law.
(ii) For purposes of this Agreement, the term "Cause" means either
(a) that the Executive shall have committed: (1) an intentional act of fraud,
embezzlement or theft in connection with his duties or in the course of his
employment with the Company; (2) intentional wrongful damage to property of the
Company, (3) intentional misconduct that is materially injurious to the Company,
monetarily or otherwise; (4) an intentional breach of the Executive's
obligations set forth in Section 5, and any such act shall have been materially
harmful to the Company; or (b) the failure by the Executive to comply with the
policies and procedures then applicable to employees of the Company who have
positions comparable to the Executive; provided, however, that the Executive
shall not be terminated for Cause pursuant to this Section 3.1(ii)(b) unless he
shall have received a written report setting forth in reasonable detail the
manner in which he has failed to meet such policies and procedures and
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within 30 calendar days after receiving such report, the Board (or Chief
Executive Officer and/or President of the Company) shall have determined in good
faith that the Executive shall have failed to make substantial progress in
meeting the Company's policies and procedures. For purposes of this Agreement,
an act or failure to act on the part of the Executive shall be deemed
"intentional" only if done or omitted to be done by the Executive not in good
faith and without reasonable belief that his action or omission was in the best
interest of the Company.
3.2 Termination.
(i) Involuntary Termination. The Executive's employment hereunder
may be terminated by the Company for any reason by written notice as provided in
Section 8.4. The Executive will be treated for purposes of this Agreement as
having been involuntarily terminated by the Company other than for Cause if the
Executive terminates his employment with the Company for any of the following
reasons: (a) the Company requests that the Executive provide services that are
not of a similar character to those provided by the Executive to Banneker
immediately prior to the date hereof; (b) the Company has breached any material
provision of this Agreement and within 30 days after notice thereof from the
Executive, the Company fails to cure such breach; or (c) the Company requires
the Executive to relocate his principal place of employment to any location
outside a fifty mile radius from the location of the Executive's principal place
of employment immediately prior to the date hereof.
(ii) Voluntary Termination. The Executive may voluntarily terminate
the Agreement at any time by notice to the Company as provided in Section 8.4.
3.3 Termination Payments and Benefits
(i) Form and Amount. Upon the Executive's involuntary termination
other than for Cause during the Employment Term, the Company will pay an amount
to the Executive as follows: (a) if the termination occurs on or prior to the
second anniversary of the Closing Date, an amount equal to three times the sum
of the Executive's annual salary and target annual incentive compensation in
effect immediately prior to the termination, multiplied by a fraction the
numerator of which is the number of full months remaining in the Employment Term
and the denominator of which is 36; and (b) if the termination occurs after the
second anniversary of the Closing Date, an amount equal to the sum of the
Executive's annual salary and target annual incentive compensation in effect
immediately prior to the termination. Any amount due pursuant to this Section
3.3 will be
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payable in a lump sum less applicable taxes within 30 days following
termination.
(ii) Maintenance of Benefits. During the period set forth below, the
Company will use its best efforts to maintain in full force and effect for the
continued benefit of the Executive, and his or her eligible dependents, all
health and welfare benefits which the Executive was entitled to receive
immediately prior to his termination or will arrange to make available to the
Executive benefits substantially similar to those that the Executive would
otherwise have been entitled to receive if his employment had not been
terminated. Such benefits will be provided to the Executive on the same terms
and conditions (including employee contributions toward the premium payments)
under which the Executive was entitled to participate immediately prior to his
termination. The term of continued benefits will be as follows: (a) if the
termination occurs on or prior to the second anniversary of the Closing Date,
the term will be the remainder of the Employment Term if there had been no
termination and (b) if the termination occurs after the second anniversary of
the Closing Date, the term will be 12 months.
(iii) Release. No amount or benefit will be paid or made available
under this Section 3 unless (a) the Executive executes a release in a form
satisfactory to the Company, and (b) to the extent such payment or benefit is
subject to the seven-day revocation period prescribed by the Age Discrimination
in Employment Act of 1967, as amended, or to any similar revocation period in
effect on the date of termination of Executive's employment, such revocation
period has expired.
4. Mitigation and Offset. The Executive is under no obligation to mitigate
damages or the amount of any payment provided for hereunder by seeking other
employment or otherwise; provided, however, that the Executive's coverage under
the Company's health and welfare plans will be reduced to the extent that the
Executive becomes covered under any comparable employee benefit plan made
available by another employer and covering the same type of benefits. The
Executive will report to the Company any such benefits actually received by him.
5. Competition; Confidentiality, Nonsolicitation
5.1. The Executive hereby covenants and agrees that during the
Employment Term and for the applicable period following the Employment Term
specified in Section 3.3(ii)(a) or (b), whichever would be applicable if Section
3.3(ii) applied (regardless of whether the Executive's termination of employment
was for cause or otherwise), he will not, without the prior written consent of
the Company, engage in Competition (as defined
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below) with the Company. Notwithstanding the foregoing, in the event that the
Executive voluntarily terminates his employment with the Company, the
Non-Competition period provided for herein will end on the later of (a) the
second anniversary of the Closing Date and (b) the six month anniversary of the
termination date. For purposes of this Agreement, "Competition" means
participating in the management of any business enterprise if such enterprise
engages in substantial and direct competition with the Company and such
enterprise's sales of any product or service competitive with any product or
service of the Company amounted to 25% of such enterprise's net sales for its
most recently completed fiscal year and if the Company's net sales of said
product or service amounted to 25% of the Company's net sales for its most
recently completed fiscal year. "Competition" will not include (i) the mere
ownership of securities in any enterprise and exercise of rights appurtenant
thereto or (ii) participation in management of any enterprise or business
operation thereof other than in connection with the competitive operation of
such enterprise.
5.2 During the Employment Term, the Company agrees that it will disclose
to Executive its confidential or proprietary information (as defined in this
Section 5.2) to the extent necessary for Executive to carry out his obligations
under this Agreement. The Executive hereby covenants and agrees that he will
not, without the prior written consent of the Company, during the Employment
Term or thereafter disclose to any person not employed by the Company, or use in
connection with engaging in Competition with the Company, any confidential or
proprietary information of the Company. For purposes of this Agreement, the term
"confidential or proprietary information" will include all information of any
nature and in any form that is owned by the Company and that is not publicly
available or generally known to persons engaged in businesses similar or related
to those of the Company. Confidential information will include, without
limitation, the Company's financial matters, customers, employees, industry
contracts, and all other secrets and all other information of a confidential or
proprietary nature. Confidential information shall not include information that
comes into the possession of the Executive following termination from a source
not under a duty to the Company to refrain from disclosing such information. The
foregoing obligations imposed by this Section 5.2 will cease if such
confidential or proprietary information will have become, through no fault of
the Executive, generally known to the public or the Executive is required by law
to make disclosure (after giving the Company notice and an opportunity to
contest such requirement).
5.3 The Executive hereby covenants and agrees that during the Employment
Term and for one year following the
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Employment Term he will not attempt to influence, persuade or induce, or assist
any other person in so persuading or inducing, any employee of the Company to
give up, or to not commence, employment or a business relationship with the
Company.
5.4 For purposes of this Section 5, the term the "Company" means the
Company and its subsidiaries, collectively.
6. Post-termination Assistance. The Executive agrees that after his
employment with the Company has terminated he will provide, upon reasonable
notice, such information and assistance to the Company as may reasonably be
requested by the Company in connection with any litigation, investigation, audit
or similar matter in which it or any of its affiliates is or may become a party;
provided, however, that the Company agrees to reimburse the Executive for any
related out-of-pocket expenses, including travel expenses.
7. Survival. The expiration or termination of the Employment Term will not
impair the rights or obligations of any party hereto that accrue hereunder prior
to such expiration or termination, except to the extent specifically stated
herein. In addition to the foregoing, the Executive's covenants contained in
Sections 5.1, 5.2, 5.3 and 6 and the Company's obligations under Section 3 will
survive the expiration or termination of Executive's employment.
8. Miscellaneous Provisions
8.1 Binding on Successors This Agreement will be binding upon and inure
to the benefit of the Company, the Executive and each of their respective
successors, assigns, personal and legal representatives, executors,
administrators, heirs, distributees, devisees and legatees, as applicable.
8.2 Governing Law. This Agreement will be governed, construed,
interpreted and enforced in accordance with the substantive laws or the State of
Ohio, without regard to conflict of law principles.
8.3 Severability. Any provision of this Agreement that is deemed
invalid, illegal or unenforceable in any jurisdiction will, as to that
jurisdiction be ineffective to the extent of such invalidity, illegality or
unenforceability, without affecting in any way the remaining provisions hereof
in such jurisdiction or rendering that or any other provisions of this Agreement
invalid, illegal, or unenforceable in any other jurisdiction. If any covenant
should be deemed invalid, illegal or unenforceable because its scope is
considered excessive, such covenant will be modified so that the scope of the
covenant is
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reduced only to the minimum extent necessary to render the modified covenant
valid, legal and enforceable.
8.4 Notices. For all purposes of this Agreement, all communications,
including without limitation notices, consents, requests or approvals, required
or permitted to be given hereunder must be in writing and will be deemed to have
been duly given when hand delivered or dispatched by electronic facsimile
transmission (with receipt thereof confirmed), or five business days after
having been mailed by United States registered or certified mail, return receipt
requested, postage prepaid, or three business days after having been sent by a
nationally recognized overnight courier service such as Federal Express, UPS or
Purolator, addressed as follows, or to such other address as any party may have
furnished to the other in writing and in accordance herewith, except that
notices of changes of address will be effective only upon receipt.
(i) To the Company. If to the Company, addressed to:
R2
0000 Xxxxxxxx Xxxx.
Xxxxxxxxx, Xxxx 00000
Attn: Secretary
Telecopy: 216.291.7563
(ii) To the Executive. If to the Executive, to him at _____________
8.5 Counterparts. This Agreement may be executed in several
counterparts, each of which will be deemed to be an original, but all of which
together will constitute one and the same Agreement.
8.6 Entire Agreement. The terms of this Agreement are intended by the
parties to be the final expression of their agreement with respect to the
Executive's employment by the Company and may not be contradicted by evidence of
any prior or contemporaneous agreement. The parties further intend that this
Agreement will constitute the complete and exclusive statement of its terms and
that no extrinsic evidence whatsoever may be introduced in any judicial,
administrative or other legal proceeding to vary the terms of this Agreement.
This agreement supersedes any and all prior agreements applicable to the terms
and conditions of Executive's employment with any entity referred to herein.
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8.7 Amendments: Waivers. This Agreement may not be modified, amended, or
terminated except by an instrument in writing, approved by the Company and
signed by the Executive and the Company. Failure on the part of either party to
complain of any action or omission, breach or default on the part of the other
party, no matter how long the same may continue, will never be deemed to be a
waiver of any rights or remedies hereunder, at law or in equity. The Executive
or the Company may waive compliance by the other party with any provision to
this Agreement that such other party was or is obligated to comply with or
perform only through an executed writing; provided, however, that such waiver
will not operate as a waiver of, or estoppel with respect to, any other or
subsequent failure.
8.8 No Inconsistent Actions. The parties will not voluntarily undertake
or fail to undertake any action or course of action that is inconsistent with
the provisions or essential intent of this Agreement. Furthermore, it is the
intent of the parties hereto to act in a fair and reasonable manner with respect
to the interpretation and application of the provisions of this Agreement.
8.9 Headings and Section References. The headings used in this Agreement
are intended for convenience or reference only and will not in any manner
amplify, limit, modify or otherwise be used in the construction or
interpretation of any provision of this Agreement. All section references are to
sections of this Agreement, unless otherwise noted.
9. Treatment of Options. Executive agrees that he will not exercise any
options which he currently holds to purchase common stock of Banneker (the
"Options") prior to the Closing Date, and that upon the Closing Date, Executive
will receive cash in exchange for the cancellation of his Options as set forth
in Section 1.9(a) of the Merger Agreement.
10. Effectiveness. This Agreement will become effective upon the Closing
Date, except for the provisions of Section 9, which shall become effective as of
the date hereof. Notwithstanding any other provision of this Agreement, if the
Merger Agreement is terminated prior to the Effective Time, this Agreement will
have no further force or effect.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
and year first above written, but effective as provided in Section 9.
Name:
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TRW, INC.,
an Ohio corporation
By:
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DULY AUTHORIZED
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