(CABLE DESIGN TECHNOLOGIES CORPORATION LOGO)
EXHIBIT 10.10
July 8, 2004
Xxxxx Xxxxxxx
C/o CDT
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Dear Xxxxx:
As you know, on February 4, 2004, Cable Design Technologies Corporation
(the "Company"), BC Merger Corp. (the "Subsidiary") and Xxxxxx Inc. ("Belden")
entered into an Agreement and Plan of Merger (the "Merger Agreement") pursuant
to which, among other things, the Subsidiary will be merged with and into Belden
(the "Merger"). The Company believes that it is crucial that we take steps to
retain key employees like you whose role is essential to our ongoing business
efforts and to the successful completion of the Merger. This Agreement is
intended to provide you with an incentive to continue your employment through
the date on which the Merger is completed (the "Closing Date") and an additional
transition period of two years thereafter (the "Retention Period").
Accordingly, as a means of assuring itself of the continued availability of your
services during this critical time, the Company desires to enter into this
Agreement with you.
1. RETENTION AND INTEGRATION AWARD. If the Merger is completed
pursuant to the Merger Agreement, then, subject to the terms of this Agreement,
you shall receive a retention payment (a "Retention and Integration Award")
equal to 110% of your base annual salary as in effect on the date of the Merger
Agreement (subject to all applicable withholding taxes). 50% of the value of the
Retention and Integration Award will be in the form of a cash award (the "Cash
Award") and the remaining 50% will be in the form of shares of CDT restricted
common stock (the "Restricted Stock Award") (which value shall be based on the
closing price of common stock of the Company on the Closing Date, as adjusted by
the proposed reverse stock split of the common stock of the Company, if
appropriate).
(a) Cash Award. Subject to Section 2 and provided that you are
employed by the Company or one of its affiliates on each applicable
payment date set forth below, the Company shall pay you the Cash Award
at the following times: (i) one-third (1/3) of the Cash Award on the
Closing Date, (ii) one-third (1/3) of the Cash Award on the first
anniversary of the Closing Date and (iii) the remaining one-third
(1/3) of the Cash Award on the second anniversary of the Closing Date.
(b) Restricted Stock Award. Subject to Section 2 and provided
that you are employed by the Company or one of its affiliates on each
applicable vesting date set forth below, your Restricted Stock Award
shall vest at the following times: (i) one-third (1/3) of the
Restricted Stock Award on the Closing Date, (ii) one-third (1/3) of
the Restricted Stock Award on the first anniversary of the Closing
Date and (iii) the remaining one-third (1/3) of the Restricted Stock
Award on the second anniversary of the Closing Date.
Except as limited by this Agreement, you will have all rights
associated with the restricted stock, whether vested or unvested,
unless and until such shares are forfeited in accordance with the
terms of this Agreement, including the right to vote, or to direct the
voting of, such shares and to receive any dividends on such shares;
provided that prior to vesting of the restricted stock (i) no
certificates for such restricted stock will be issued to you and (ii)
no such restricted stock will be transferable by you.
2. CIRCUMSTANCES WHEN RETENTION AND INTEGRATION AWARD WILL NOT BE
PAID OR VEST. Notwithstanding anything in this Agreement to the contrary if (i)
you terminate your employment with the Company and its affiliates for any reason
prior to the end of the Retention Period (including death or for "good reason"
under your change of control agreement), (ii) the Company and its affiliates
terminate your employment for any reason prior to the end of the Retention
Period or (iii) the Merger does not occur, then the Company shall not be
obligated
0000 X. Xxxxxxx Xxxx x Xxxxxxxxxx, XX 00000
(000) 000-0000 o Fax: (000) 000-0000
(CABLE DESIGN TECHNOLOGIES CORPORATION LOGO)
July 8, 2004
Page 2 of 3
to pay to you any unpaid Cash Award and any unvested portion of the Restricted
Stock Award shall be forfeited and cancelled. In the event that a portion of the
Restricted Stock is forfeited, you grant to each officer of the Company (acting
solely) the power of attorney to take such actions on your behalf to cause such
portion of the Restricted Stock Award to be cancelled
3. TREATMENT OF EXISTING EQUITY AWARDS. In consideration of the Company
entering into this Agreement, you agree that notwithstanding anything in the
Company's 1993 Long Term Performance Incentive Plan, the Company's 1995
Supplemental Long-Term Performance Incentive Plan, the Company's 1999 Long-Term
Performance Incentive Plan, any other Company plan, the change of control
letter agreement dated October 6, 2003 (the "Change of Control Agreement"), or
any agreement entered into thereunder (collectively, the "Compensation Plans"),
neither the Merger nor any of the other transactions contemplated by the Merger
Agreement shall constitute a "change of control" for purposes of any restricted
stock awards held by you under the Compensation Plans and no such restricted
stock shall vest as a result thereof. For clarity, the Other Restricted Stock
Awards will continue to vest in accordance with terms of the Compensation Plans
and your restricted award agreements. Nothing herein shall affect the vesting
of stock option awards upon the effectiveness of the Merger. Notwithstanding
the preceding sentence, if your employment is terminated following the Merger by
the Company and its affiliates without good cause or by you for good reason (as
such terms are defined in your Change of Control Agreement), immediately prior
to the effective time of such termination (i) any unvested shares of restricted
stock issued to you (other than any unvested portion of the Restricted Stock
Award) shall vest and the restrictions thereunder shall terminate or lapse so
that such shares of stock shall be freely transferable, subject to applicable
securities laws and (ii) each then unvested stock option granted to you and
then outstanding shall become exercisable and all stock options then held by
you may be exercised by you (subject to the terms of such options, other than
vesting) for twelve months following the date of such termination of
employment. You agree to take such actions as the Company may request in order
to effectuate the foregoing.
4. PAYMENT TAXABLE/NOT BENEFIT BEARING. The Company shall be entitled to
withhold from any payment made pursuant to this Agreement all taxes and other
amounts required to be withheld under applicable law and, subject to Section 8,
you shall pay to the Company or its designee, upon its demand such amount as
may be required for the purpose of satisfying the Company's obligation to
withhold federal, state, local or foreign income, employment or other taxes
incurred by reason of the vesting of the Restricted Stock or your filing of a
Section 83(b) election (which election shall be in your sole discretion).
Amounts payable under this Agreement and the value of any Restricted Stock
Award shall not be treated as compensation for purposes of computing or
determining any benefit under any pension, savings, severance, bonus/
incentive, insurance, or other employee compensation or benefit plan of the
Company or any of its subsidiaries.
5. NO RIGHT TO CONTINUED EMPLOYMENT/NO LIMIT ON COMPANY DISCRETION.
Nothing in this Agreement is intended to limit the Company's discretion to take
any action with regard to the Merger that the Company may consider appropriate,
including, without limitation, postponing the Closing Date or terminating the
Merger Agreement. This Agreement does not entitle you to be retained in the
employ of the Company for any minimum or prescribed period of time and does not
otherwise modify the status of your employment.
6. GOVERNING LAW. This Agreement shall be interpreted and enforced in
accordance with the laws of the State of Delaware, disregarding its choice of
law rules.
7. ACKNOWLEDGEMENT; SUCCESSORS; REFERENCES. You acknowledge that you
understand the terms of this Agreement. This Agreement may be modified only by
written agreement duly executed by you and Company. References herein to
employment by the "Company" include your employment by a subsidiary of the
Company.
8. TAX WITHHOLDING; DEFERRALS. You may elect to satisfy any FICA or tax
withholding obligations under federal, state or local law arising from the
vesting of any Restricted Stock Award by having the Company retain the number
of shares of common stock whose Fair Market Value equals the FICA and tax
amount required to
(CABLE DESIGN TECHNOLOGIES CORPORATION LOGO)
July 8, 2004
Page 3 of 3
be withheld (or at your option a lesser number). Any amount so elected to be
withheld shall be applied to the FICA and tax obligations generated by the
vesting of the Restricted Stock Award. To make a tax withholding/FICA election,
you must provide a written election request to the Director, Tax & Assistant
Treasurer at least 10 days prior to the vesting of a Restricted Stock Award (or,
in the case of shares vesting on the Closing Date, prior to the issuance of
certificates). "Fair Market Value" shall mean the closing price of CDT common
stock on the date of vesting of any Restricted Stock Award.
9. SUCCESSORS. In addition to any obligations imposed by law upon any
successor to the Company, 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 to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. This Agreement shall not be terminated by the voluntary or
involuntary dissolution of the Company.
10. DUE AUTHORIZATION. The execution, delivery and performance by the
Company of this Agreement have been duly authorized by all requisite corporate
action. This Agreement has been duly and validly executed and delivered by the
Company and constitutes the valid and legally binding obligations of the Company
enforceable against the Company in accordance with its terms. This Agreement may
be executed in separate counterparts, each of which is deemed to be an original
and all of which taken together constitute one and the same agreement.
I hope that the terms of this Agreement and the incentive just described
will induce you to remain in the employ of the Company and to continue your
valuable contributions to our Company's success. Please indicate your acceptance
of this Agreement by signing the enclosed copy of this letter and returning it
to me within five (5) business days.
Sincerely,
CABLE DESIGN TECHNOLOGIES CORPORATION
By: /s/ XXXXXXX X. XXXXX
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Xxxxxxx X. Xxxxx
Vice President, General Counsel
I have read, understand and agree to the foregoing.
/s/ XXXXX XXXXXXX
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Xxxxx Xxxxxxx -- Signature
