EXHIBIT 10.5
EMPLOYMENT AGREEMENT
AGREEMENT made this 10th day of November, 1997, by and between
Xxxxxxx-Xxxxxx Inc. (the "Company"), and Xxxx X. Xxxxxxxx (the
"Executive").
The Executive is presently employed as Head of Industrial and Retail
Division Americas and as Member of the Group Management Committee of the
XXXXXXX TOLEDO Group ("XXXXXXX TOLEDO").
The Board of Directors of the ultimate parent company (the "Board")
recognizes that the Executive's contribution to the growth and success of
XXXXXXX TOLEDO has been substantial. The Board desires to provide for the
continued employment of the Executive and to make certain changes in the
Executive's employment arrangements with the Company which the Board has
determined will reinforce and encourage the continued attention and
dedication to XXXXXXX TOLEDO of the Executive as a member of XXXXXXX
TOLEDO's management, in the best interest of XXXXXXX TOLEDO and its
shareholders. The Executive is willing to commit himself to continue to
serve XXXXXXX TOLEDO, on the terms and conditions herein provided.
In order to effect the foregoing, the Company and the Executive wish to
enter into an employment agreement on the terms and conditions set forth
below. Accordingly, in consideration of the premises and the respective
covenants and agreements of the parties herein contained, and intending to
be legally bound hereby, the parties hereto agree as follows:
SECTION 1. EMPLOYMENT.
The Company hereby agrees to continue to employ the Executive, and the
Executive hereby agrees to continue to serve XXXXXXX TOLEDO, on the terms
and conditions set forth herein.
SECTION 2. TERM.
This Agreement enters into force as of November 10, 1997. It is of
unlimited duration.
SECTION 3. POSITION AND DUTIES.
During the Term, the Executive shall serve as Head of Industrial and Retail
Division Americas and as Member of the Group Management Committee of
XXXXXXX TOLEDO and shall have such responsibilities, duties and authority
as he may have as of the date hereof and as may from time to time be
assigned to the Executive by the Board that are consistent with such
responsibilities, duties and authority.
SECTION 4. PLACE OF PERFORMANCE.
In connection with the Executive's employment by the Company, the Executive
shall be based at the executive offices of XXXXXXX TOLEDO in Worthington,
Ohio, USA, except for required travel on XXXXXXX TOLEDO's business to on
extent substantially consistent with present business travel obligations.
SECTION 5. COMPENSATION AND RELATED MATTERS.
(a) SALARY.
During the Term, the Company shall pay to the Executive an annual base
salary at a rate of USD 220'000. -- or such higher rate as may from time to
time be determined by the Board, such salary to be paid in substantially
equal installments in accordance with the Company's payroll practices for
its senior executives. This salary may be increased from time to time in
accordance with normal business practices of the Company. Compensation of
the Executive by salary payments shall not be deemed exclusive and shall
not prevent the Executive from participating in any other compensation or
benefit plan of the Company. The salary payments (including any increased
salary payments) hereunder shall not in any way limit or reduce any other
obligation of the Company hereunder, and no other compensation, benefit or
payment hereunder shall in any way limit or reduce the obligation of the
Company to pay the Executive's salary hereunder.
(b) BONUS.
During the Term, the Executive shall be entitled to earn annual incentive
compensation in accordance with the POBS Plus Plan for Senior Management,
as attached hereto as Exhibit Al.
(c) EXPENSES.
Expenses shall be reimbursed according to the Company expense regulations
as amended from time to time.
(d) OTHER BENEFITS.
(i) The Company shall maintain in full force and effect, and the Executive
shall be entitled to continue to participate in, all of the Company's
insurance benefit plans and arrangements in effect on the date hereof in
which the Executive participates or plans or arrangements providing the
Executive with at least equivalent benefits thereunder (including, without
limitation, the Xxxxxxx-Xxxxxx, Inc. Pension Plan, the 401 K Retirement
Plan, and the Company's medical and life / accident / disability plans),
provided that the Company shall not make any changes in such plans or
arrangements that would adversely affect the Executive's rights or benefits
thereunder; provided, however, that, such a change may be made, including
termination of such plans or arrangements if it occurs pursuant to a
program applicable to all executives of the Company and does not result in
a proportionately greater reduction in the rights of or benefits to the
Executive as compared with any other executive of the Company. The
Executive shall be entitled to participate in or receive benefits under any
employee benefit plan or arrangement made available by the Company in the
future to its executives and key management employees, subject to and on a
basis consistent with the terms, conditions and overall administration of
such plans and arrangements. Nothing paid to the Executive under any plan
or arrangement presently in effect or made available in the future shall be
deemed to be in lieu of the salary payable to the Executive pursuant to
paragraph (a) of this Section.
(ii) The Executive shall be entitled to participation in the (x)
Xxxxxxx-Xxxxxx Group Management Committee Stock Purchase Plan, and (y) the
Xxxxxxx-Xxxxxx Management Share Option Plan, each as may be amended from
time to time.
(iii) Any payments or benefits payable to the Executive under this
Agreement in respect of any calendar year during which the Executive is
employed by the Company for less than the entire such year shall, unless
otherwise provided in the applicable plan or arrangement, be prorated in
accordance with the number of full and partial months in such calendar year
during which he is so employed.
(e) VACATIONS.
The Executive shall be entitled to no less than 20 paid vacation days in
each calendar year. The Executive shall also be entitled to all paid
holidays and personal days given by the Company to its executives.
(f) COMPANY CAR.
The Executive shall be provided with the company car that he has been
provided with by the Company as of the date hereof (or a similar car as a
replacement therefore), always in line with the actually valid car policy
and rules for the senior management staff of the Company.
SECTION 6. OFFICES.
Subject to Sections 3 and 4, the Executive agrees to serve without
additional compensation, if elected or appointed thereto, as a director of
any of XXXXXXX TOLEDO's group companies, and in one or more executive
offices of any of XXXXXXX TOLEDO's group companies.
SECTION 7. TERMINATION.
(a) This Agreement may be terminated by either party without cause by
giving twelve (12) months notice in writing to the end of a month, and
shall terminate at the end of such notice period.
(b) The Company may terminate the Executive's employment hereunder without
any breach of this Agreement and without a twelve months notice period only
under the following circumstances:
(aa) Death: The Executive's employment hereunder shall terminate upon
his death.
(bb) Disability: If, as a result of the Executive's incapacity due to
physical or mental illness, the Executive shall have been absent from
his duties hereunder on a full-time basis for the entire period of six
consecutive months, and within thirty (30) days after written notice
of termination is given (which may occur before or after the end of
such six month period) shall not have returned to the performance of
his duties hereunder on a full-time basis, the Company may terminate
the Executive's employment hereunder.
(cc) Cause: The Company may terminate the Executive's employment
hereunder for cause, with immediate effect.
(c) The Executive may terminate his employment in case of failure by the
Company to comply with any material provision of this Agreement with
immediate effect.
SECTION 8. COMPENSATION UPON TERMINATION.
During the notice period, the Executive is entitled to full compensation as
defined in Section 5 of this Agreement and in the annexes / exhibits
therein referred to.
During the disability period of 6 months, the Executive is entitled to full
compensation as defined in Section 5 of this Agreement and in the annexes /
exhibits therein referred to, while his employment is terminated pursuant
to Section 7(b)(bb) hereof.
SECTION 9. NO MITIGATION OR OFFSET / NONCOMPETITION.
During notice periods, the Company may waive the services of the Executive.
If the Company so decides, the Executive shall have no duty to mitigate
damages by seeking another employment or otherwise, nor shall the amount of
any payment or benefit due under Section 5 be reduced by any compensation
earned by the Executive as the result of an employment by another employer,
by retirement benefits (other than as paid by the Company or under Company
benefits schemes) or by offset against any amount claimed to be owed by the
Executive to the Company. While the Executive is employed by the Company
hereunder and for a period of twelve (12) months after the termination of
the Executive's employment, the Executive shall not knowingly engage in or
be employed by any business anywhere in the world which competes with the
principal businesses of the Company or its affiliates as conducted at the
date of such employment termination.
SECTION 10. SUCCESSORS; BINDING AGREEMENT.
(a) The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all
of the business and/or assets of the Company, by agreement in form and
substance satisfactory to the Executive, to expressly assume and agree to
perform this Agreement in some manner and to the some extent that the
Company would be required to perform it if no such succession had taken
place. Failure of the Company to obtain such assumption and agreement prior
to the effectiveness of any such succession shall, be a breach of this
Agreement and shall entitle the Executive to compensation from the Company
in the some amount and on the some terms as he would be entitled to under
Sections 7 and 8 hereof if the Company had terminated his employment under
Section 7(a) hereof. As used in this Agreement, "Company" shall mean the
Company as herein before defined and any successor to its business and/or
assets as aforesaid which executes and delivers the agreement provided for
in this Section 11 or which otherwise becomes bound by all the terms and
provisions of this Agreement by operation of low.
(b) If the Executive should die after the giving of notice pursuant to
Section 7 but while any amounts would still be payable to him hereunder if
he hod continued to live, all such amounts, unless otherwise provided
herein, shall be paid in accordance with the terms of this Agreement to the
Executive's devisee, legatee, or other designee or, if there be no such
designee, to the Executive's estate. If the Executive should die before the
giving of such notice under Section 7 and while he is employed pursuant to
this Agreement, the Company shall continue to pay to the Executive's estate
his salary for the period of six months from the date of such death and a
pro rata portion of the bonus, if any, payable for the year in which the
Executive died.
SECTION 11. NOTICE.
For the purposes of this Agreement, notices, demands and all other
communications provided for in this Agreement shall be in writing and shall
be deemed to have been duly given when delivered or (unless otherwise
specified) mailed by US or Swiss certified or registered mail, return
receipt requested, postage prepaid, addressed as follows:
If to the Executive:
Xx. Xxxx X. Xxxxxxxx
000 Xxxxxxxx Xxxx
Xxxxxxxxxxx, XX 00000
XXX
If to the Company:
Xxxxxxx-Xxxxxx XxxX
Xx Xxxxxxxxx
XX-0000 Greifensee
Attn.: Chief Executive Officer
or to such other address as any party may have furnished to the others in
writing in accordance herewith, except that notices of change of address
shall be effective only upon receipt.
SECTION 12. MISCELLANEOUS.
No provisions of this Agreement may be modified, waived or discharged
unless such waiver, modification or discharge is agreed to in writing
signed by the Executive and such officer of the Company as may be
specifically designated by the Board. 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. No agreements or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not set
forth expressly in this Agreement. Insofar as this Agreement does not
stipulate anything else to the contrary, the Human Resources Policy and
General Rules of Employment of the Company shall be applicable. The
validity, interpretation, construction and performance of this Agreement
shall be governed by the laws of the United States.
SECTION 13. VALIDITY.
The invalidity or unenforceability of any provision or provisions of this
Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.
SECTION 14. COUNTERPARTS.
This Agreement may be executed in one or more counterparts, each of which
shall be deemed to be an original but all of which together will constitute
one and the some instrument.
SECTION 15. DISPUTES.
All disputes between the Executive and the Company concerning the terms and
conditions of this Agreement shall be brought before the ordinary courts in
the United States.
SECTION 16. ENTIRE AGREEMENT.
This Agreement sets forth the entire agreement of the parties hereto in
respect of the subject matter contained herein and supersedes all prior
agreements, promises, covenants, arrangements, communications,
representations or warranties, whether oral or written, by any officer,
employee or representative of any party hereto; and any prior agreement of
the parties hereto in respect of the subject matter contained herein is
hereby terminated and canceled.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
and year first above written.
Xxxxxxx-Xxxxxx GmbH,
by:/s/ XXXXXX X. XXXXXXX
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Xxxxxx X. Xxxxxxx
by:/s/ XXXXX XXXXXX
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Xxxxx Xxxxxx
by:/s/ XXXX X. XXXXXXXX
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Xxxx X. Xxxxxxxx
