Exhibit 99.2
AMENDED EMPLOYMENT AGREEMENT
AGREEMENT, made and entered into effective as of the 13th day of March,
2002 (the "Effective Date") by and between IKON Office Solutions, Inc., an Ohio
corporation with its principal office located at 00 Xxxxxx Xxxxxx Xxxxxxx,
Xxxxxxx, Xxxxxxxxxxxx 00000 (together with its successors and assigns permitted
under this Agreement, the "Company") and Xxxxx X. Xxxxxx, who resides at 000
Xxxxxxxx Xxxx, Xx. Xxxxxx, Xxxxxxxxxxxx 00000 (the "Executive").
W I T N E S S E T H :
WHEREAS, the Executive is currently employed as the Chief Executive
Officer ("CEO") and President of the Company, pursuant to an Employment
Agreement dated October 1, 1998 that is currently in full force and effect (the
"Old Employment Agreement");
WHEREAS, the Company and the Executive have mutually agreed to the
Executive's retirement from service with the Company, except as provided below,
after the Company, with assistance from the Executive, identifies and hires a
successor;
WHEREAS, the Company desires to continue the employment of the
Executive under the terms and conditions of the Old Employment Agreement,
amended to reflect the transition and post-retirement arrangements set forth in
this Agreement;
WHEREAS, the Executive desires to accept such continued employment with
the Company, subject to the terms and provisions of this Agreement;
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the receipt of
which is mutually acknowledged, the Company and the Executive (together, the
"Parties") agree as follows:
1. Definitions.
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(a) "Affiliate" of a Person shall mean a Person that directly or
indirectly controls, is controlled by, or is under common control with, the
Person specified.
(b) "Agreement" shall mean this Employment Agreement, which includes
for all purposes the Mutual Release of which a form is attached as Exhibit A.
(c) "Base Salary" shall mean the salary provided for in Section 4 or
any increased salary granted to the Executive pursuant to Section 4.
(d) "Board" shall mean the Board of Directors of the Company.
(e) "Cause" shall mean:
(i) the Executive is convicted of a felony involving moral
turpitude; or
(ii) the Executive engages in conduct that constitutes willful
gross neglect or willful gross misconduct in carrying out his duties under this
Agreement, resulting, in either case, in material economic harm to the Company,
unless the Executive believed in good faith that such conduct was in, or not
opposed to, the best interests of the Company.
(f) "Change in Control" shall mean the occurrence of any of the
following events:
(i) any "person," as such term is currently used in Section 13(d)
of the Securities Exchange Act of 1934, as amended, becomes a "beneficial
owner," as such term is currently used in Rule 13d-3 promulgated under that act,
of 15% or more of the Voting Stock of the Company;
(ii) a majority of the Board consists of individuals other than
Incumbent Directors, which term means the members of the Board on October 1,
1998; provided that any individual becoming a director subsequent to such date
whose election or nomination for election was supported by a majority of the
directors who then comprised the Incumbent Directors shall be considered to be
an Incumbent Director;
(iii) the Company adopts any plan of liquidation providing for
the distribution of all or substantially all of its assets;
(iv) 50% or more of the assets of the Company is disposed of
pursuant to a merger, consolidation or other transaction or series of
transactions (unless the shareholders of the Company immediately prior to such
merger, consolidation or other transaction or series of transactions
beneficially own, directly or indirectly, in substantially the same proportion
as they owned the Voting Stock of the Company, more than 50% of the Voting Stock
or other ownership interests of the entity or entities, if any, that succeed to
the business of the Company); or
(v) the Company combines with another company and is the
surviving corporation but, immediately after the combination, the shareholders
of the Company immediately prior to the combination hold 50% or less of the
Voting Stock of the combined company, (there being excluded from the number of
shares held by such shareholders, but not from the Voting Stock of the combined
company, any shares received by Affiliates of such other company in exchange for
stock of such other company).
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(g) "Claim" shall mean any claim, demand, request, investigation,
dispute, controversy, threat, discovery request, or request for testimony or
information.
(h) "Committee" shall mean the Human Resources Committee of the Board;
(i) "Common Stock" shall mean common stock of the Company.
(j) "Constructive Termination Without Cause" shall mean a termination
by the Executive of his employment hereunder on 30 days' written notice given by
him to the Company following the occurrence, without his prior written consent,
of any of the following events, unless the Company shall have fully cured all
grounds for such termination within 15 days after the Executive gives notice
thereof:
(i) any reduction in his then current Base Salary or in his
target or maximum annual bonus opportunity as a percentage of Base Salary;
(ii) any material failure to timely grant, or timely honor, any
equity or long-term incentive award under Section 6;
(iii) any material breach of any of the Company's obligations,
representations or warranties in this Agreement;
(iv) any failure to appoint, elect or reelect him to any of the
positions described in Section 3(a) (other than a failure to elect or re-elect
him as President and CEO upon the commencement of employment of a new President
and CEO of the Company as such); the removal of him from any such position
(other than his removal as President and CEO upon the commencement of employment
of a new President and CEO of the Company as such); or any change in the
reporting structure so that he reports to someone other than the Board (or, upon
the commencement of employment of a new President and CEO of the Company as
such, other than to that individual or to the Board);
(v) any material diminution in his duties (other than upon a new
President and CEO commencing employment as such) or the assignment to him of
duties that materially impair his ability to perform his duties;
(vi) following any Change in Control or Potential Change in
Control, any relocation of the Company's principal office, or of his own office
as assigned to him by the Company, to a location more than 50 miles from
Malvern, Pennsylvania;
(vii) following any Change in Control or Potential Change in
Control, any failure by the Company to continue in effect any compensation plan
in which the Executive participated immediately prior to such Change in Control
or Potential Change in Control and which is material to the Executive's total
compensation, including but not limited to the Company's stock option, incentive
compensation, deferred compensation, stock purchase, bonus and other plans or
any substitute plans adopted prior to the Change in Control, unless an equitable
arrangement (embodied in an ongoing substitute or alternative plan) has been
made
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with respect to such plan, or any failure by the Company to continue the
Executive's participation therein (or in such substitute or alternative plan) on
a basis no less favorable to the Executive, both in terms of the amount of
benefits provided and the level of the Executive's participation relative to
other participants, as existed immediately prior to such Change in Control or
Potential Change in Control;
(viii) following any Change in Control or Potential Change in
Control, any failure by the Company to continue to provide the Executive with
benefits substantially similar to those enjoyed by the Executive under any of
the Company's pension, life insurance, medical, health and accident, or
disability plans in which the Executive was participating immediately prior to
such Change in Control or Potential Change in Control, the taking of any action
by the Company which would directly or indirectly materially reduce any of such
benefits or deprive the Executive of any perquisite enjoyed by the Executive at
the time of such Change in Control or Potential Change in Control, or the
failure by the Company to maintain a vacation policy with respect to the
Executive that is at least as favorable as the vacation policy (whether formal
or informal) in place with respect to the Executive immediately prior to such
Change in Control or Potential Change in Control; or
(ix) the failure of the Company to obtain the assumption in
writing of its obligation to perform this Agreement by any successor to all or
substantially all of the assets of the Company within 15 days after a merger,
consolidation, sale or similar transaction.
(k) "Disability" shall mean the Executive's inability, due to physical
or mental incapacity, to substantially perform his duties and responsibilities
under this Agreement for a period of 180 consecutive days as determined by an
approved medical doctor, selected by the Parties. If the Parties cannot agree on
a medical doctor, each Party shall select a medical doctor and the two doctors
shall select a third who shall be the approved medical doctor for this purpose.
(l) "Effective Date" shall mean March 13, 2002.
(m) "Long-Term Incentive Plan" shall mean any of the long-term
incentive plans referred to in Section 6(b) of this Agreement or in Section 6(b)
of the Old Employment Agreement.
(n) "Person" shall mean any individual, corporation, partnership,
limited liability company, joint venture, trust, estate, board, committee,
agency, body, employee benefit plan, or other person or entity.
(o) "Potential Change in Control" shall mean the occurrence of any of
the following events:
(i) the Company enters into an agreement, the consummation of
which will result in the occurrence of a Change in Control;
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(ii) the Company or any Person publicly announces an intention to
take or to consider taking actions which, if consummated, will constitute a
Change in Control; or
(iii) the Board adopts a resolution to the effect that, for
purposes of this Agreement, a Potential Change in Control has occurred.
(p) "Proceeding" shall mean any threatened or actual action, suit or
proceeding, whether civil, criminal, administrative, investigative, appellate or
other.
(q) "Pro-Rata" shall mean a fraction, the numerator of which is the
number of days that the Executive was employed in the applicable performance
period (a fiscal year in the case of an annual bonus and a performance cycle in
the case of an award under the Long-Term Incentive Plan) and the denominator of
which shall be the number of days in the applicable performance period.
(r) "Special Stock Option" shall mean the stock option referred to in
Section 6(a) of the Old Employment Agreement.
(s) "Term of Employment" shall mean the period specified in Section 2.
(t) "Termination Date" shall mean the date on which the Executive's
employment hereunder terminates in accordance with this Agreement.
(u) "Voting Stock" shall mean issued and outstanding capital stock or
other securities of any class or classes having general voting power, under
ordinary circumstances in the absence of contingencies, to elect, in the case of
a corporation, the directors of such corporation and, in the case of any other
entity, the corresponding governing Person(s).
2. Term of Employment.
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The Company hereby employs the Executive under this Agreement,
and the Executive hereby accepts such employment, for the Term of Employment.
The Term of Employment shall commence as of the Effective Date and shall end on
the later of (a) close of business on October 1, 2002 and (b) the earlier of (i)
the date a new President and CEO commences employment as such and (ii) the date
that the Company's 2003 annual meeting of shareholders occurs. Notwithstanding
the foregoing, the Term of Employment may be earlier terminated in accordance
with the provisions of Section 8.
3. Positions, Duties and Responsibilities During Term of Employment and
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Thereafter.
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(a) During the Term of Employment: the Executive shall serve as the
President and CEO of the Company until a new President and CEO commences
employment as such; shall serve as a member of, and the Chairman of, the Board;
while serving in the foregoing positions, shall have the authority, duties and
responsibilities customarily exercised by an individual serving in those
positions in a corporation of the size and nature of the Company; shall
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assist in recruiting his successor as President and CEO of the Company; shall
perform such duties relating to the management and operations of the Company,
consistent with the foregoing and with his senior status, as may from time to
time reasonably be assigned to him by the Board; shall be assigned no duties or
responsibilities that are materially inconsistent with, or that materially
impair his ability to discharge, the foregoing duties and responsibilities; and
shall report solely and directly to the Board; provided, however, that at such
time as a new President and CEO commences employment as such, the Executive
shall provide reasonable assistance, and report, to that individual if requested
by the Board.
(b) Upon the expiration of the Term of Employment pursuant to the
second sentence of Section 2, the Executive shall serve as the non-executive
Chairman of the Board through the date that the Company's 2003 annual meeting of
shareholders occurs; shall have all authorities, duties and responsibilities
customarily exercised by an individual serving in that position at a corporation
of the size and nature of the Company; but shall not be entitled to any
additional compensation or benefits for that service.
(c) Upon the expiration of the Term of Employment pursuant to the
second sentence of Section 2, the Executive shall make himself reasonably
available, through September 30, 2003, for such consulting services as the
Board, or the successor President and CEO may from time to time reasonably
request; provided that such services neither (a) materially interfere with the
Executive's other obligations (including, without limitation, obligations
relating to any new employment he may obtain) nor (b) exceed 25 hours per
calendar month. The Executive and his dependents shall continue to receive,
through December 31, 2002 and at the Company's expense, all health and medical
benefits that he and his dependents were receiving as of the Termination Date
or, in the sole discretion of the Company, a cash bonus sufficient, on an
after-tax basis, to enable the Executive to purchase such coverage from the
Company through the exercise of his COBRA rights.
(d) Anything herein to the contrary notwithstanding, nothing shall
preclude the Executive from (i) serving, with prior notice to the Board, on the
boards of directors of a reasonable number of other corporations or the boards
of a reasonable number of trade associations and/or charitable organizations,
(ii) engaging in charitable activities and community affairs, and (iii) managing
his personal investments and affairs; provided that such activities do not
materially interfere with the performance of the Executive's duties and
responsibilities hereunder.
4. Base Salary.
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During the Term of Employment, the Executive shall be paid an
annualized Base Salary of $825,000, payable in accordance with the regular
payroll practices of the Company. The Base Salary shall be reviewed no less
frequently than annually for increase in the discretion of the Board.
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5. Annual Incentive Awards.
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The Executive shall be entitled to receive an annual incentive
bonus award from the Company in respect of fiscal year 2002, such bonus to be
paid to the Executive in cash, to the extent applicable criteria are satisfied,
(a) whether or not the Executive is employed by the Company on the payment date
and (b) no later than the date that other senior executives are paid their
annual incentive bonus awards for fiscal year 2002.
6. Long-Term Incentive Awards.
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(a) Equity Awards. All of the Executive's stock option, restricted
stock and other equity awards that are outstanding as of the Effective Date
(including, without limitation, the Special Stock Option) shall remain
outstanding, in accordance with their terms, after the Effective Date except to
the extent otherwise provided in this Agreement.
(b) Long-Term Incentive Plans.
(i) All of the Executive's Long-Term Incentive Plan awards that
are outstanding as of the Effective Date shall remain outstanding, in accordance
with their terms, after the Effective Date except to the extent otherwise
provided in this Agreement.
(ii) No new equity award or Long-Term Incentive Plan award shall
be made to the Executive after September 30, 2002.
7. Other Benefits.
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(a) Other Executive Compensation Plans. During the Term of Employment,
the Executive shall be entitled to participate in all compensation plans and
programs made generally available to senior executives of the Company, including
without limitation the Executive Deferred Compensation Plan.
(b) Employee Benefits. During the Term of Employment, the Executive
shall participate in all employee benefit plans and programs made available
generally to the Company's senior executives or to its employees, including,
without limitation, pension, profit-sharing, savings and other retirement plans
or programs, medical, dental, hospitalization, short-term and long-term
disability and life insurance plans or programs, accidental death and
dismemberment protection, travel accident insurance, and any other employee
welfare or retirement benefit plans or programs that may be sponsored by the
Company from time to time, including any plans or programs that supplement the
above-listed types of plans or programs, whether funded or unfunded. The
Executive shall be entitled to post-retirement welfare benefits on the same
basis as other similarly situated senior executives of the Company, provided
that for this purpose the Executive's period of employment shall be deemed to be
the period necessary to obtain the maximum level of such benefits.
(c) Expenses. The Executive is authorized to incur reasonable expenses
in carrying out his duties and responsibilities hereunder, and the Company shall
promptly
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reimburse him for all such expenses, subject to documentation in accordance with
reasonable policies of the Company. The Company shall promptly reimburse the
Executive for all expenses (including, without limitation, attorney's fees and
other charges of counsel) incurred by him in connection with the negotiation and
documentation of these amended employment arrangements up to a maximum of
$35,000.
(d) Perquisites. During the Term of Employment, the Executive shall
participate in all perquisites available to senior executives of the Company at
levels, and on terms and conditions, that are commensurate with his positions
and responsibilities at the Company, and shall receive such additional fringe
benefits and perquisites as the Company may, in its discretion, from
time-to-time provide, including without limitation:
(i) a leased automobile for the Executive's use (including,
without limitation, all costs of insurance, maintenance, repairs, oil and gas);
(ii) a complete annual executive physical examination;
(iii) appropriate home office equipment, including without
limitation a personal computer, fax machine, lap-top computer and similar
equipment;
(iv) a cellular telephone and related service;
(v) tax preparation and financial counseling services, up to
$5,000 per calendar year; and
(vi) five weeks paid vacation per year.
8. Termination of Employment.
--------------------------
(a) Expiration of Term of Employment Pursuant to Section 2. In the
event that the Executive's employment hereunder is terminated due to the
expiration of the Term of Employment pursuant to the second sentence of Section
2, and subject to the provisions of Section 12, he shall be entitled to the
following benefits:
(i) the annual bonus incentive award specified in Section 5;
(ii) all of his outstanding stock options (including, without
limitation, the Special Stock Option) shall become fully vested, fully
exercisable and wholly non-forfeitable as of October 1, 2002;
(iii) each of his outstanding stock options (including, without
limitation, the Special Stock Option) shall, to the extent that it is or becomes
vested or exercisable as of October 1, 2002, remain exercisable through the
earlier of (A) the fifth anniversary of the October 1, 2002 and (B) the
expiration of its maximum stated term;
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(iv) 96,250 of his restricted shares that are outstanding and
unvested as of the Effective Date, and that do not otherwise vest on or before
September 30, 2002, shall vest as of October 1, 2002;
(v) all of his restricted shares that are, or become, vested as
of October 1, 2002, shall be wholly non-forfeitable and free of all contractual
restrictions;
(vi) all of his restricted shares that are outstanding as of the
Effective Date and that have not vested, and do not become vested, as of October
1, 2002 shall be forfeited;
(vii) all of his outstanding Long-Term Incentive Plan awards
shall become fully vested and non-forfeitable as of October 1, 2002, with full
payout (to the extent applicable criteria are satisfied) no later than the date
that corresponding awards pay out to other senior executives of the Company;
(viii) a Pro-Rata annual incentive award with respect to any
portion of the Company's 2003 fiscal year in which the Executive remains
President and CEO, based on the same terms and conditions as are set forth in
paragraphs 4 through 7 of the letter to the Executive of December 16, 2001 from
Xxxxxx X. Xxxxx except that the target amounts for revenue, operating income and
cash set under the IKON Corporate Plan for 2003 shall be substituted for those
same amounts set under the IKON Corporate Plan for 2002, payable no later than
the date that corresponding awards are paid to other senior executives of the
Company;
(ix) subject to the provisions of Section 12, a lump-sum cash
payment in the amount of $500,000, to be paid within 35 business days following
the Termination Date unless a delay is required under Section 12 in the event of
the Executive's death or incapacity, in which case payment shall be made
immediately after the extension provided in that Section;
(x) to be treated, to the extent that it is advantageous to him
in determining his benefits under the plans, programs and arrangements of the
Company and its Affiliates, as having voluntarily retired from his employment;
and
(xi) the benefits described in Section 8(i)(i).
(b) Termination Due to Death. In the event that the Executive's
employment hereunder is terminated due to his death, his estate or his
beneficiaries (as the case may be) shall be entitled to:
(i) Base Salary through the end of the month in which his death
occurs; and
(ii) the benefits described in Section 8(a).
(c) Termination Due to Disability. In the event that the Executive's
employment hereunder is terminated due to Disability, he shall be entitled to
the following:
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(i) Base Salary through the end of the month in which the
Termination Date occurs; and
(ii) the benefits described in Section 8(a).
No termination of the Executive's employment for Disability shall
be effective unless the Party terminating his employment first gives 15 days
written notice of such termination to the other Party.
(d) Termination by the Company for Cause.
------------------------------------
(i) No termination of the Executive's employment hereunder by the
Company for Cause shall be effective unless the provisions of this Section
8(d)(i) shall have been complied with. The Executive shall be given written
notice by the Board of the intention to terminate him for Cause, such notice to
state in detail the particular circumstances that constitute the grounds on
which the proposed termination for Cause is based. The Executive shall have 15
days after receiving such notice in which to cure such grounds, to the extent
such cure is possible. If he fails to cure such grounds, the Executive shall
then be entitled to a hearing before the Board. Such hearing shall be held
within 20 days of his receiving such notice, provided that he requests such
hearing within 15 days of receiving such notice. If, within five days following
such hearing, the Board gives written notice to the Executive confirming that,
in the judgment of at least two thirds of the members of the Board, Cause for
terminating his employment on the basis set forth in the original notice exists,
his employment hereunder shall thereupon be terminated for Cause, subject to de
novo review, at the Executive's election, through arbitration in accordance with
Section 17.
(ii) In the event that the Executive's employment hereunder is
terminated by the Company for Cause in accordance with Section 8(d)(i), he shall
be entitled to: (i)
(A) expiration and forfeiture of any stock options
unexercisable on the Termination Date;
(B) 30 days to exercise any stock option exercisable on the
Termination Date; and
(C) the benefits described in Section 8(i)(i).
(e) Termination Without Cause. In the event that the Executive's
employment hereunder is terminated by the Company without Cause and neither
Section 8(c) nor Section 8(g) applies, then the Executive shall be entitled to:
(i) Base Salary through the second anniversary of the Termination
Date, payable as provided in Section 4.
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(ii) a Pro-Rata annual incentive award for the fiscal year in
which his employment terminates, based on the target bonus for the year of
termination, payable in a lump sum promptly following the Termination Date;
(iii) an annual incentive award for a period of 24 months
following the Termination Date, based on a target bonus equal to 100% of his
annualized Base Salary as of the Termination Date, payable on a Pro-Rata basis
in equal installments over the 24-month period for which Base Salary is
continued;
(iv) the continued right to exercise the Special Stock Option,
for the lesser of (A) 5 years and (B) the remainder of its term, such option to
become fully exercisable as of the Termination Date;
(v) the continued right to exercise any outstanding stock option,
other than the Special Stock Option, for a period of 3 months, all such options
to become fully exercisable as of the Termination Date;
(vi) full payout, at maximum levels, under each ongoing Long-Term
Incentive Plan in which the Executive is participating as of the Termination
Date, with the payouts due in a lump sum promptly following the Termination
Date;
(vii) continued participation, through the second anniversary of
the Termination Date, in all medical, dental, vision, hospitalization,
disability and life insurance coverages and in all other employee welfare
benefit plans, programs and arrangements in which he or his family members were
participating on such date, on terms and conditions that are no less favorable
to him than those that applied on such date and with COBRA benefits commencing
thereafter; provided that the Company's obligation under this Section 8(e)(vii)
shall be reduced to the extent that equivalent coverages and benefits
(determined on a coverage-by-coverage and benefit-by-benefit basis) are provided
under the plans, programs or arrangements of a subsequent employer; and
(viii) the benefits described in Section 8(i)(i).
(f) Constructive Termination Without Cause. In the event that (x) a
Constructive Termination Without Cause occurs and (y) Section 8(g) does not
apply, then the Executive shall have the same entitlements as provided under
Section 8(e) for a termination by the Company without Cause.
(g) Termination Without Cause Following a Change in Control or
Potential Change in Control. In the event that (x) the Executive's employment
hereunder is terminated (A) through a Constructive Termination Without Cause or
(B) by the Company without Cause and (y) the termination of employment occurs in
connection with, or within two years following, a Change in Control or Potential
Change in Control, then the Executive shall be entitled to:
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(i) Base Salary through the third anniversary of the Termination
Date, payable as provided in Section 4;
(ii) a Pro-Rata annual incentive award for the fiscal year in
which his employment terminates based on the greater of (A) the Executive's
actual bonus for the year preceding termination and (B) his maximum bonus for
the year of termination under the arrangements that applied prior to the
execution of this Agreement, payable in a lump sum promptly following the
Termination Date;
(iii) an annual incentive award for a period of 36 months
following the Termination Date, based on the greater of (A) his maximum annual
incentive bonus for the year of termination under the arrangements that applied
prior to the execution of this Agreement and (B) his actual bonus for the year
preceding termination, payable in equal installments over the 36-month period
for which Base Salary is continued.
(iv) the continued right to exercise any stock option, for the
lesser of (A) 24 months and (B) the remainder of its term, such option to become
fully exercisable as of the Termination Date;
(v) full payout, at maximum levels, under each ongoing Long-Term
Incentive Plan in which the Executive is participating as of the Termination
Date, with the payouts due in a lump sum promptly following the Termination
Date;
(vi) an amount equal to the Company's contributions to which the
Executive would have been entitled under the Company's Retirement Savings Plan
(or any successor thereto) if the Executive had continued working for the
Company and the Retirement Savings Plan continued in force during the Separation
Period at the highest annual rate of Base Salary achieved during the Executive's
period of actual employment with the Company, and making the maximum amount of
employee contributions, if any, as are required under such plans;
(vii) an amount equal to the excess of (A) the present value of
the benefits to which the Executive would be entitled under the Company's
Pension Plan and Company's Supplemental Retirement Plan (and any successor
thereto) if the Executive had continued his employment with the Company for a
period of 36 months following the Termination Date at the highest annual rate of
Base Salary achieved during the Executive's period of actual employment with the
Company, and the Pension Plan continued in force during the Separation Period,
over (B) the present value of the benefits to which the Executive is actually
entitled under the Company's Pension Plan and Supplemental Retirement Plan, each
computed as of the date of the Executive's Date of Termination, with present
values to be determined using the discount rate used by the Pension Benefits
Guaranty Corporation to calculate the benefit liabilities under the Pension Plan
in the event of a plan termination on the Date of Termination, compounded
monthly, the mortality tables then prescribed in the Company's Pension Plan for
determining actuarial equivalence, and the reduction factor (if any) for the
early commencement of pension payments based on the Executive's age on the last
day of the 36th month following the Termination Date;
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(viii) continued participation, through the third anniversary of
the Termination Date, in all medical, dental, vision, hospitalization,
disability and life insurance coverages and in all other employee welfare
benefit plans, programs and arrangements in which he or his family members were
participating on such date, on terms and conditions that are no less favorable
to him than those that applied on such date and with COBRA benefits commencing
thereafter, provided that the Company's obligation under this Section 8(g)(vi)
shall be reduced to the extent that equivalent coverages and benefits
(determined on a coverage-by-coverage and benefit-by-benefit basis) are provided
under the plans, programs or arrangements of a subsequent employer; and
(ix) the benefits described in Section 8(i)(i).
(h) Voluntary Termination. In the event that the Executive terminates
his employment with the Company on his own initiative, other than by death, for
Disability, or by a Constructive Termination Without Cause, then he shall have
the same entitlements as provided in Section 8(d)(ii) in the case of a
termination by the Company for Cause. A voluntary termination under this Section
8(h) shall be effective upon written notice to the Company and shall not be
deemed a breach of this Agreement.
(i) Miscellaneous.
(i) On any termination of the Executive's employment
hereunder, he shall be entitled to:
(A) Base Salary at least through the Termination Date;
(B) the balance of any incentive awards earned (but not yet
paid);
(C) any amounts or benefits due him under Section 7;
(D) a lump-sum payment in respect of accrued but unused
vacation days at his Base Salary rate in effect as of
the Termination Date;
(E) payment, promptly when due, of all amounts owed to him
in connection with the termination; and
(F) other benefits, if any, in accordance with applicable
plans, programs and arrangements of the Company and its
Affiliates, provided that Executive shall not be
eligible to receive payments under any severance
program of the Company or its Affiliates applicable to
employees of the Company generally.
(ii) In the event that the Executive, or any member of his
family, is precluded from continuing full participation in any employee benefit
plan, program or arrangement as provided in this Agreement, then the Executive
shall be provided with the after-tax
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economic equivalent of any benefit or coverage foregone. For this purpose, the
economic equivalent of any benefit or coverage foregone shall be deemed to be
the total cost to the Executive of obtaining such benefit or coverage himself on
an individual basis. Payment of such after-tax economic equivalent shall be made
quarterly in advance, without discount.
(iii) In the event of any termination of the Executive's
employment hereunder, the Executive shall be under no obligation to seek other
employment or otherwise mitigate the obligations of the Company under this
Agreement.
(iv) In the event of a termination of Executive's employment due
to (x) a Termination without Cause governed by Section 8(e) or (y) a
Constructive Termination without Cause governed by Section 8(f), the Base Salary
continuation payments shall be offset to the extent of the Executive's earnings
from full-time employment with another employer during the period of Base Salary
continuation.
(v) In the event of any termination of the Executive's employment
hereunder, including, but not limited to, following the expiration of the Term
of Employment, he shall be deemed to have resigned all offices, directorships
and other positions with the Company and its Affiliates except to the extent
otherwise provided under Section 3.
(vi) Any amounts due under this Section 8 are considered to be
reasonable by the Company and are not in the nature of a penalty.
9. Change in Control.
------------------
(a) Vesting. In the event that a Change in Control or Potential Change
in Control occurs after the Effective Date, then each outstanding stock option
(including, without limitation, the Special Stock Option) shall become fully
exercisable as of the date of such Change in Control or Potential Change in
Control and shall remain fully exercisable for the remainder of its maximum
stated term except as otherwise provided in Section 8. In the event that holders
of Common Stock receive cash, securities or other property in respect to their
Common Stock in connection with a Change in Control transaction, the Company
shall use its best reasonable efforts to enable the Executive (if he so elects)
to exercise any stock option at a time and in a fashion that will entitle him to
receive in exchange for any shares thus acquired the same consideration as is
received in such Change in Control transaction by other holders of Common Stock.
(b) Golden Parachute Tax. In the event that any payment or benefit made
or provided to or for the benefit of the Executive in connection with this
Agreement, the Executive's employment with the Company, or the termination
thereof (a "Payment") is determined to be subject to any excise tax ("Excise
Tax") imposed by Section 4999 of the Code (or any successor to such Section),
the Company shall pay to the Executive, prior to the time any Excise Tax is
payable with respect to such Payment (through withholding or otherwise), an
additional amount which, after the imposition of all income, employment, excise
and other taxes, penalties and interest thereon, is equal to the sum of (i) the
Excise Tax on such Payment plus (ii) any penalty and interest assessments
associated with such Excise Tax. The determination of
14
whether any Payment is subject to an Excise Tax and, if so, the amount to be
paid by the Company to the Executive and the time of payment shall be made by an
independent auditor (the "Auditor") selected jointly by the Parties and paid by
the Company. Unless the Executive agrees otherwise in writing, the Auditor shall
be a nationally recognized United States public accounting firm that has not,
during the two years preceding the date of its selection, acted in any way on
behalf of the Company or any of its Affiliates. If the Parties cannot agree on
the firm to serve as the Auditor, then the Parties shall each select one
accounting firm and those two firms shall jointly select the accounting firm to
serve as the Auditor.
10. Indemnification; D&O Insurance.
-------------------------------
(a) Indemnification. The Company agrees that (i) if the Executive is
made a party, or is threatened to be made a party, to any Proceeding by reason
of the fact that he is or was a director, officer, employee, agent, manager,
consultant or representative of the Company or is or was serving at the request
of the Company or any of its Affiliates as a director, officer, member,
employee, agent, manager, consultant or representative of another Person or (ii)
if any Claim is made, or threatened to be made, that arises out of or relates to
this Agreement or the Executive's service hereunder or in any of the foregoing
capacities, then the Executive shall promptly be indemnified and held harmless
by the Company to the fullest extent legally permitted or authorized by the
Company's certificate of incorporation, bylaws or Board resolutions or, if
greater, by the laws of the State of Ohio, against any and all costs, expenses,
liabilities and losses (including, without limitation, attorney's fees,
judgments, interest, expenses of investigation, penalties, fines, ERISA excise
taxes or penalties and amounts paid or to be paid in settlement) incurred or
suffered by the Executive in connection therewith, and such indemnification
shall continue as to the Executive even if he has ceased to be a director,
member, employee, agent, manager, consultant or representative of the Company or
other Person and shall inure to the benefit of the Executive's heirs, executors
and administrators. The Company shall advance to the Executive all costs and
expenses incurred by him in connection with any such Proceeding or Claim within
15 days after receiving written notice requesting such an advance. Such notice
shall include, to the extent required by applicable law, an undertaking by the
Executive to repay the amount advanced if he is ultimately determined not to be
entitled to indemnification against such costs and expenses.
(b) D&O Insurance. During (i) the Term of Employment and (ii) any
period thereafter during which the Executive serves as a member of the Board,
and for a period of six years commencing on the later of the Termination Date
and the date that the Executive ceases to be a member of the Board, the Company
shall keep in place a directors and officers' liability insurance policy (or
policies) providing comprehensive coverage to the Executive to the extent that
the Company (or any of its Affiliates) then provides such coverage for any other
present or former senior executive or director.
11. Covenants.
---------
(a) Confidentiality. During the Term of Employment and thereafter, the
Executive shall not, without the prior written consent of the Company, divulge,
disclose or make accessible to any Person any confidential non-public document,
record or information
15
concerning the business or affairs of the Company that he has acquired in the
course of his employment hereunder (including this Agreement), except (w) to the
Company or to any authorized (or apparently authorized) agent or representative
of the Company, (x) in connection with performing his duties under this
Agreement, (y) when required to do so by law or by a court, governmental agency,
legislative body, or other Person with apparent jurisdiction to order him to
divulge, disclose or make accessible such information, or (z) in the case of the
provisions of this Section 11, in confidence to any potential new employer;
provided that these restrictions shall not apply to any document, record or
other information that (i) has previously been disclosed to the public, or is in
the public domain, other than as a result of the Executive's breach of this
Section 11(a), or (ii) is known or generally available within any trade or
industry of the Company other than as a result of the Executive's breach of this
Section 11(a).
(b) Non-Solicitation. During the 24 month period that commences on the
Termination Date and ends on the second anniversary of the Termination Date, the
Executive shall not without the prior consent of the Company:
(i) solicit, on his own behalf or on behalf of any other Person,
any individual known by the Executive to be an employee of the Company to
instead become an employee of any Person not affiliated with the Company;
(ii) solicit, on his own behalf or on behalf of any other Person,
any Person known by the Executive to be customer of, or vendor to, the Company
to instead become a customer of, or vendor to, any Person not affiliated with
the Company.
(c) Non-Competition. During the 12 month period that commences on the
Termination Date and ends on the first anniversary of the Termination Date, the
Executive shall not, without the prior consent of the Company, directly or
indirectly own, manage, operate, join, control or participate in the ownership,
management, operation or control of, or be employed by or otherwise connected in
any substantial manner with any business which directly or indirectly competes
to a material extent with any line of business of the Company or its
subsidiaries which was operated by the Company or its subsidiaries at the
Termination Date; provided that nothing in this paragraph shall prohibit the
Executive from acquiring up to 5% of any class of outstanding equity securities
of any corporation whose equity securities are regularly traded on a national
securities exchange or in the "over-the-counter market;" and provided further,
that the foregoing restriction of this Section 11(c) shall not apply following a
Change of Control Event or a Potential Change in Control Event if (v) the
Executive's employment has been terminated by the Company without Cause, (w) the
Executive terminates his employment as the result of a Constructive Termination
or (x) the Company elects not the extend the Term of Employment.
(d) The Executive acknowledges and agrees that the restrictions
contained in this Section 11 are reasonable and necessary to protect and
preserve the legitimate interests, properties, goodwill and business of the
Company and that the Company would not have entered into this Agreement in the
absence of such restrictions. The Executive represents and acknowledges that (i)
the Executive has been advised by the Company to consult the Executive's own
legal counsel in respect of this Agreement, and (ii) that the Executive has so
consulted with counsel and has had full opportunity, prior to execution of this
Agreement, to review thoroughly this Agreement with the Executive's counsel. The
Executive further acknowledges and agrees
16
that a breach of the restrictions in Section 11 may not be adequately
compensated by monetary damages. The Executive agrees that the Company shall be
entitled to seek preliminary and permanent injunctive relief to enforce the
provisions of this Section 11. In the event that the provisions of Section 11
should ever be adjudicated to exceed the limitations permitted by applicable law
in any jurisdiction, it is the intention of the parties that the provision shall
be amended to the extent of the maximum limitations permitted by applicable law,
that such amendment shall apply only within the jurisdiction of the court that
made such adjudication and that the provision otherwise be enforced to the
maximum extent permitted by law.
(e) If the Executive is alleged to have breached his obligations under
this Section 11, he agrees that suit may be brought, and that he consents to
personal jurisdiction, in the United States District Court for the Eastern
District of Pennsylvania, or if such court does not have jurisdiction or will
not accept jurisdiction, in any court of general jurisdiction in Xxxxxxx County,
Pennsylvania, consents to the non-exclusive jurisdiction of any such court in
any such suit seeking to obtain injunctive relief, and waives any objection
which he may have to the laying of venue of any such suit in any such court. The
Executive also irrevocably and unconditionally consents to the service of any
process, pleadings, notices or other papers. In the event that the Company does
not substantially prevail in any such suit, the Company shall promptly pay all
costs and expenses, including without limitation reasonable attorneys' fees,
incurred by the Executive in resolving any such suit.
12. Mutual Release of Claims. The Parties shall, concurrently with entering
into this Agreement, execute a Mutual Release in substantially the form appended
to this Agreement as Exhibit A. If the Term of Employment expires pursuant to
the second sentence of Section 2 and the Company executes and delivers to the
Executive, within five days following the Termination Date, a reaffirmation of
the Mutual Release in the form described in Section 3 of such Mutual Release,
those of the Executive's entitlements pursuant to Section 8(a) and described in
the next sentence of this Section 12 shall be conditioned on the Executive's (a)
countersigning and returning such reaffirmation within 21 days after receiving
it (or, in the event of the Executive's death or incapacity, such longer period
as may be reasonably necessary for an executor or other personal representative
to be appointed) and (b) not revoking such reaffirmation within the 7-day period
following such countersigning. In the event that the Executive does not
countersign the reaffirmation or revokes his reaffirmation, as applicable, the
Executive will, on the day following the last day to reaffirm, or to revoke the
reaffirmation of, the Mutual Release, as applicable, (c) forfeit any right to
the $500,000 payment referred to in Section 8(a)(ix), and (d)(i) forfeit and
transfer back to the Company the 96,250 restricted shares referred to in Section
8(a)(iv), or (ii) to the extent the Executive has sold or otherwise disposed of
such shares at the time they are required to be returned, pay to the Company an
amount equal to the value on the immediately preceding business day, based on
the average of the high and low trading price of the Company's shares on that
day, of the shares not able to be returned to the Company.
13. Mutual Non-Disparagement. The Executive shall not intentionally make
any public statement, encourage any other Person to make any public statement,
or publicly release
17
any information, that disparages or defames the Company or any of its Affiliates
or any of its or their officers, employees, agents or directors. The Company
shall not intentionally make any public statement, encourage any other Person to
make any public statement, or publicly release any information that disparages
or defames the Executive. The Company shall use its best reasonable efforts to
cause its Affiliates, and its and their directors, officers, agents and
employees, not to make any such public statement, or publicly release any such
information. Notwithstanding the foregoing, nothing in this Section 13 shall
prohibit any Person from making any truthful statement (a) when required by law
or by order of any court, governmental agency, legislative body, or other Person
with apparent jurisdiction to require such statement; (b) in confidence to
family members and professional advisers; or (c) to correct misstatements made
(x) by either Party, (y) by any officer, employee, agent or director of a Party
or of any of the Affiliates of a Party, or (z) with the encouragement of any of
the foregoing.
14. Mutually Agreed Public Announcements. Each Party shall, to the extent
reasonably practicable, afford the other Party a reasonable advance opportunity
to discuss and coordinate any public statement or announcement, and any internal
or private announcement, concerning the transition arrangements set forth in
this Agreement. Neither Party shall make any such announcement without the prior
consent of the other, unless required to do so by law or by order of any court,
governmental agency, legislative body, or any regulations or rules thereof,
which consent shall not be unreasonably withheld or delayed.
15. Assignability; Binding Nature.
------------------------------
This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors, heirs (in the case of the Executive)
and assigns. No rights or obligations of the Company under this Agreement may be
assigned or transferred by the Company except that such rights or obligations
may be assigned or transferred pursuant to a merger or consolidation in which
the Company is not the continuing entity, or a sale or liquidation of all or
substantially all of the assets of the Company; provided that the assignee or
transferee is the successor to all or substantially all of the assets of the
Company and such assignee or transferee assumes the liabilities, obligations and
duties of the Company, as contained in this Agreement, either contractually or
as a matter of law. In the event of any sale of assets or liquidation as
described in the preceding sentence, the Company shall use its best efforts to
cause such assignee or transferee to expressly assume the liabilities,
obligations and duties of the Company hereunder. No rights or obligations of the
Executive under this Agreement may be assigned or transferred by the Executive
other than his rights to compensation and benefits, which may be transferred
only by will or operation of law, except as provided in Section 19(e).
16. Representations.
----------------
(a) The Company's Representations. The Company represents and warrants,
as of the Effective Date, that (i) it is fully authorized by action of its Board
(and of any other Person or body whose action is required) to enter into this
Agreement and to perform its obligations under it; (ii) the execution, delivery
and performance of this Agreement by the Company does not violate any applicable
law, regulation, order, judgment or decree or any agreement, plan or corporate
governance document of the Company; and (iii) upon the execution and delivery of
this Agreement by the Parties, this Agreement shall be the valid and binding
obligation of the Company, enforceable against the Company in accordance with
its
18
terms, except to the extent enforceability may be limited by applicable
bankruptcy, insolvency or similar laws affecting the enforcement of creditors'
rights generally.
(b) The Executive's Representations. The Executive represents and
warrants, to the best of his knowledge and belief as of the Effective Date, that
(i) delivery and performance of this Agreement by him does not violate any
applicable law, regulation, order, judgment or decree or any agreement to which
the Executive is a party or by which he is bound, and (ii) upon the execution
and delivery of this Agreement by the Parties, this Agreement shall be the valid
and binding obligation of the Executive, enforceable against him in accordance
with its terms, except to the extent enforceability may be limited by applicable
bankruptcy, insolvency or similar laws affecting the enforcement of creditors'
rights generally.
17. Resolution of Disputes.
-----------------------
Except to the extent otherwise provided by Section 11 as to Claims for
injunctive relief, any Claim arising out of or relating to this Agreement, the
Old Employment Agreement, or the Executive's employment with the Company or the
termination thereof shall be resolved by binding confidential arbitration, to be
held in Philadelphia, Pennsylvania, in accordance with the Commercial
Arbitration Rules of the American Arbitration Association. Judgment upon the
award rendered by the arbitrator(s) may be entered in any court having
jurisdiction thereof. The Company shall promptly pay all costs and expenses,
including without limitation attorneys' fees, incurred by the Executive or his
beneficiaries in resolving any such Claim. Pending the resolution of any Claim,
the Executive (and his beneficiaries) shall continue to receive all payments and
benefits due under this Agreement.
18. Notices.
--------
Any notice, consent, demand, request, or other communication
given to a Person in connection with this Agreement shall be in writing and
shall be deemed to have been given to such Person (a) when delivered personally
to such Person or (b), provided that a written acknowledgment of receipt is
obtained, two days after being sent by prepaid certified or registered mail, or
by a nationally recognized overnight courier, to the address specified below for
such Person (or to such other address as such Person shall have specified by ten
days advance notice given in accordance with this Section 18), or (c) in the
case of the Company only, on the first business day after it is sent by
facsimile to the facsimile number set forth for the Company (or to such other
facsimile number as the Company shall have specified by ten days advance notice
given in accordance with this Section 18), with a confirmatory copy sent by
certified or registered mail or by overnight courier to the Company in
accordance with this Section 18.
If to the Company: IKON Office Solutions, Inc.
00 Xxxxxx Xxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxxxxxxx 00000
Attn: General Counsel
Facsimile #: 000-000-0000
19
If to the Executive: Xxxxx X. Xxxxxx
000 Xxxxxxxx Xxxx
Xx. Xxxxxx, Xxxxxxxxxxxx 00000
(with a copy to the Executive at the Company's address)
If to a beneficiary The address most recently specified by the Executive or
of the Executive: beneficiary through notice given in accordance with this
Section 18.
19. Miscellaneous.
---------------
(a) Entire Agreement. This Agreement contains the entire understanding
and agreement between the Parties as of the Effective Date concerning the
subject matter hereof and supersedes all prior agreements, understandings,
discussions, negotiations and undertakings, whether written or oral, between the
Parties with respect thereto, including, without limitation, the Old Employment
Agreement; provided that no right or benefit to which the Executive is entitled
as of the Effective Date, under the Old Employment Agreement or otherwise, shall
be deemed waived, reduced, amended or released upon this Agreement becoming
effective, except to the extent otherwise expressly provided in this Agreement.
(b) Severability. In the event that any provision or portion of this
Agreement shall be determined to be invalid or unenforceable for any reason, in
whole or in part, the remaining provisions of this Agreement shall be unaffected
thereby and shall remain in full force and effect to the fullest extent
permitted by law so as to achieve the purposes of this Agreement.
(c) Amendment or Waiver. No provision in this Agreement may be amended
unless such amendment is set forth in a writing signed by the Parties. No waiver
by either Party of any breach of any condition or provision contained in this
Agreement shall be deemed a waiver of any similar or dissimilar condition or
provision at the same or any prior or subsequent time. To be effective, any
waiver must be set forth in a writing signed by the waiving Party.
(d) Headings. The headings of the Sections contained in this Agreement
are for convenience only and shall not be deemed to control or affect the
meaning or construction of any provision of this Agreement.
(e) Beneficiaries/References. The Executive shall be entitled, to the
extent permitted under any applicable law, to select and change a beneficiary or
beneficiaries to receive any compensation or benefit hereunder following the
Executive's death by giving the Company written notice thereof. In the event of
the Executive's death or a judicial determination of his incompetence,
references in this Agreement to the Executive shall be deemed, where
appropriate, to refer to his beneficiary, estate or other legal representative.
20
(f) Survivorship. Except as otherwise set forth in this Agreement, the
respective rights and obligations of the Parties hereunder shall survive any
termination of the Executive's employment.
(g) Governing Law/Jurisdiction. This Agreement shall be governed,
construed, performed and enforced in accordance with the laws of the State of
Pennsylvania, without reference to principles of conflict of laws.
(h) Counterparts. This Agreement may be executed in two or more
counterparts.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first set forth above.
The Company
By: ______________________________________
Name:
Title:
The Executive
------------------------------------
Xxxxx X. Xxxxxx
21
Exhibit A
Form of Mutual Release of Claims
THIS MUTUAL RELEASE OF CLAIMS ("Mutual Release") is entered
into on March ___, 2002 by and between Xxxxx X. Xxxxxx, who resides in Xx.
Xxxxxx, Xxxxxxxxxxxx (the "Executive") and IKON Office Solutions, Inc., an Ohio
Corporation with its principal office in Malvern, Pennsylvania (the "Company").
1. Release of the Company. (a) The Executive, on his own
behalf and on behalf of each of his heirs, personal representatives, executors,
administrators, successors and assigns (the "Executive Releasors"), hereby
remises, releases and forever discharges the Company, and each of its past and
present affiliates, its and their past and present officers, directors,
partners, employees and agents, their respective successors and assigns, heirs,
executors and administrators, the pension and employee benefit plans of the
Company, and of its past and present affiliates, and the past and present
trustees, administrators, agents, or employees of such pension and employee
benefit plans (the "Company Releasees"), acting in any capacity whatsoever, of
and from any and all manner of actions and causes of action, suits, debts,
claims and demands whatsoever in law or in equity ("Claims"), that any Executive
Releasor now has, may ever have had or may have hereafter upon or by reason of
any matter, cause or thing occurring, done or omitted to be done prior to the
date of this Mutual Release that constitutes an "Employment-Related Claim" as
defined below; provided, however, that this Mutual Release shall not apply to
any Claim to the extent that such Claim (x) is based on willful misconduct or
gross neglect or (y) arises under, or is preserved by, the Amended Employment
Agreement between the Company and the Executive entered into as of March 13,
2002 (the "Employment Agreement"). For purposes of this Mutual Release,
"Employment-Related Claim" means any Claim arising out of, or relating to, the
Executive's employment by the Company, his services for the Company or any of
its affiliates, his compensation from the Company and any of its affiliates, or
his status as a consultant, employee, officer or director of the Company, or of
any of its affiliates, or to the termination of any of the foregoing, including,
without limitation, any such Claim that arises under the Age Discrimination in
Employment Act of 1967, as amended (the "ADEA"); Title VII of the Civil Rights
Act of 1964, as amended; the Americans with Disabilities Act of 1990, as
amended; the Pennsylvania Human Relations Act; any other federal, state or local
laws or regulations, any contract between any of the Company Releasees and the
Executive; or any common law principle now or hereafter recognized.
(b) The Executive acknowledges and agrees that he has
read this Mutual Release in its entirety and that this Mutual Release is, to the
extent set forth in Section 1, a general release of all known and unknown
claims, including rights and claims arising under the ADEA. The Executive and
the Company further acknowledge and agree that:
(i) this Mutual Release does not release, waive or
discharge any rights or claims that may arise for actions or omissions
after the date of this Mutual Release;
22
(ii) the Executive is entering into this Mutual
Release and is releasing, waiving and discharging rights or claims in
exchange for consideration which he is not already entitled to receive;
(iii) the Executive (A) expressly waives, to the
extent necessary to make Section 1 fully effective, all rights afforded
by any statute that expressly limits the effect of a release with
respect to unknown claims and (B) understands the significance of his
release of unknown claims and waiver of statutory protection against a
release of unknown claims;
(iv) the Executive has been advised, and is being
advised by this Mutual Release, to consult with an attorney before
executing this Mutual Release which he has done;
(v) the Executive has been advised, and is being
advised by this Mutual Release, that he has up to twenty-one (21) days
within which to consider this Mutual Release with respect to claims
ongoing under the ADEA; and
(vi) the Executive is aware that this Mutual
Release will not become effective or enforceable until seven (7) days
following his execution of this Mutual Release and that he may revoke
this Mutual Release at any time during such period by delivering (or
causing to be delivered) to the Company at the address provided in the
Employment Agreement, written notice of his revocation of this Mutual
Release no later than 5:00 p.m. eastern time on the seventh (7th) full
day following his execution of this Mutual Release, provided that, in
the event of such revocation of this Mutual Release, this Mutual
Release and the Employment Agreement shall each be deemed null and
void, the Old Employment Agreement (as such term is defined in the
Employment Agreement) shall be deemed to have remained in place without
change, and the Company shall be deemed to have given notice of
non-extension, pursuant to Section 2 of the Old Employment Agreement,
prior to March 31, 2002.
2. Release of the Executive. In consideration of the
Executive's entering into this Mutual Release, the Company on its own behalf and
on behalf of each of the other Company Releasees, hereby remises, releases and
forever discharges the Executive and each of the other Executive Releasors from
and against any and all Claims that any Company Releasee now has, may ever have
had or may have hereafter upon or by reason of any matter, cause or thing
occurring, done or omitted to be done prior to the date of this Mutual Release
that constitutes an Employment-Related Claim; provided, however, that this
release shall not apply to any Claim to the extent that such Claim (a) is based
on willful misconduct or gross neglect or (b) arises under, or is preserved by,
the Employment Agreement. To the extent necessary to make the preceding release
fully effective, the Company, on its own behalf and on behalf of each of the
other Company Releasees, expressly waives all rights afforded by any statute
that expressly limits the effect of a release with respect to unknown claims.
The Company understands the significance of this release of unknown claims and
waiver of statutory protection against a release of unknown claims.
23
3. Reaffirmation of Mutual Release. If, within five days
following the expiration of the Term of Employment (as defined in the Employment
Agreement) pursuant to the second sentence of Section 2 of the Employment
Agreement, the Company reaffirms this Mutual Release by signing a new release
which, except as described below, is identical to this Mutual Release (the
"Second Mutual Release"), the Executive's entitlements pursuant to Section 8(a)
of the Employment Agreement, to the extent set forth in Section 12 of the
Employment Agreement, shall be conditioned on the Executive's (a) countersigning
the Second Mutual Release within 21 days after receiving it (or, in the event of
the Executive's death or incapacity, such longer period as may be reasonably
necessary for an executor or other personal representative to be appointed) and
(b) not revoking the Second Mutual Release within the 7-day period described in
Section 1(b)(vi) above. The Second Mutual Release shall be dated as of the date
it is countersigned by the Executive, shall not contain the proviso set forth at
the end of Section 1(b)(vi), and shall not contain this Section 3.
4. None of the parties to this Mutual Release, nor their
agents, representatives, or attorneys have made any representations to the other
concerning the terms or effects of this Mutual Release other than those
contained herein.
IN WITNESS WHEREOF, the Parties have executed this Release as
of the date and year first above written.
IKON OFFICE SOLUTIONS, INC.
By:_________________________
Name:
Title:
THE EXCUTIVE
----------------------------
Xxxxx X. Xxxxxx
24
Mutual Release of Claims
THIS MUTUAL RELEASE OF CLAIMS ("Mutual Release") is entered
into on March ___, 2002 by and between Xxxxx X. Xxxxxx, who resides in Xx.
Xxxxxx, Xxxxxxxxxxxx (the "Executive") and IKON Office Solutions, Inc., an Ohio
Corporation with its principal office in Malvern, Pennsylvania (the "Company").
1. Release of the Company. (a) The Executive, on his own
behalf and on behalf of each of his heirs, personal representatives, executors,
administrators, successors and assigns (the "Executive Releasors"), hereby
remises, releases and forever discharges the Company, and each of its past and
present affiliates, its and their past and present officers, directors,
partners, employees and agents, their respective successors and assigns, heirs,
executors and administrators, the pension and employee benefit plans of the
Company, and of its past and present affiliates, and the past and present
trustees, administrators, agents, or employees of such pension and employee
benefit plans (the "Company Releasees"), acting in any capacity whatsoever, of
and from any and all manner of actions and causes of action, suits, debts,
claims and demands whatsoever in law or in equity ("Claims"), that any Executive
Releasor now has, may ever have had or may have hereafter upon or by reason of
any matter, cause or thing occurring, done or omitted to be done prior to the
date of this Mutual Release that constitutes an "Employment-Related Claim" as
defined below; provided, however, that this Mutual Release shall not apply to
any Claim to the extent that such Claim (x) is based on willful misconduct or
gross neglect or (y) arises under, or is preserved by, the Amended Employment
Agreement between the Company and the Executive entered into as of March 13,
2002 (the "Employment Agreement"). For purposes of this Mutual Release,
"Employment-Related Claim" means any Claim arising out of, or relating to, the
Executive's employment by the Company, his services for the Company or any of
its affiliates, his compensation from the Company and any of its affiliates, or
his status as a consultant, employee, officer or director of the Company, or of
any of its affiliates, or to the termination of any of the foregoing, including,
without limitation, any such Claim that arises under the Age Discrimination in
Employment Act of 1967, as amended (the "ADEA"); Title VII of the Civil Rights
Act of 1964, as amended; the Americans with Disabilities Act of 1990, as
amended; the Pennsylvania Human Relations Act; any other federal, state or local
laws or regulations, any contract between any of the Company Releasees and the
Executive; or any common law principle now or hereafter recognized.
(b) The Executive acknowledges and agrees that he
has read this Mutual Release in its entirety and that this Mutual Release is, to
the extent set forth in Section 1, a general release of all known and unknown
claims, including rights and claims arising under the ADEA. The Executive and
the Company further acknowledge and agree that:
(i) this Mutual Release does not release, waive or
discharge any rights or claims that may arise for actions or omissions
after the date of this Mutual Release;
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(ii) the Executive is entering into this Mutual Release
and is releasing, waiving and discharging rights or claims in exchange for
consideration which he is not already entitled to receive;
(iii) the Executive (A) expressly waives, to the extent
necessary to make Section 1 fully effective, all rights afforded by any
statute that expressly limits the effect of a release with respect to
unknown claims and (B) understands the significance of his release of
unknown claims and waiver of statutory protection against a release of
unknown claims;
(iv) the Executive has been advised, and is being advised
by this Mutual Release, to consult with an attorney before executing this
Mutual Release which he has done;
(v) the Executive has been advised, and is being advised
by this Mutual Release, that he has up to twenty-one (21) days within which
to consider this Mutual Release with respect to claims ongoing under the
ADEA; and
(vi) the Executive is aware that this Mutual Release will
not become effective or enforceable until seven (7) days following his
execution of this Mutual Release and that he may revoke this Mutual Release
at any time during such period by delivering (or causing to be delivered)
to the Company at the address provided in the Employment Agreement, written
notice of his revocation of this Mutual Release no later than 5:00 p.m.
eastern time on the seventh (7th) full day following his execution of this
Mutual Release, provided that, in the event of such revocation of this
Mutual Release, this Mutual Release and the Employment Agreement shall each
be deemed null and void, the Old Employment Agreement (as such term is
defined in the Employment Agreement) shall be deemed to have remained in
place without change, and the Company shall be deemed to have given notice
of non-extension, pursuant to Section 2 of the Old Employment Agreement,
prior to March 31, 2002.
2. Release of the Executive. In consideration of the
Executive's entering into this Mutual Release, the Company on its own behalf and
on behalf of each of the other Company Releasees, hereby remises, releases and
forever discharges the Executive and each of the other Executive Releasors from
and against any and all Claims that any Company Releasee now has, may ever have
had or may have hereafter upon or by reason of any matter, cause or thing
occurring, done or omitted to be done prior to the date of this Mutual Release
that constitutes an Employment-Related Claim; provided, however, that this
release shall not apply to any Claim to the extent that such Claim (a) is based
on willful misconduct or gross neglect or (b) arises under, or is preserved by,
the Employment Agreement. To the extent necessary to make the preceding release
fully effective, the Company, on its own behalf and on behalf of each of the
other Company Releasees, expressly waives all rights afforded by any statute
that expressly limits the effect of a release with respect to unknown claims.
The Company understands the significance of this release of unknown claims and
waiver of statutory protection against a release of unknown claims.
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3. Reaffirmation of Mutual Release. If, within five days
following the expiration of the Term of Employment (as defined in the Employment
Agreement) pursuant to the second sentence of Section 2 of the Employment
Agreement, the Company reaffirms this Mutual Release by signing a new release
which, except as described below, is identical to this Mutual Release (the
"Second Mutual Release"), the Executive's entitlements pursuant to Section 8(a)
of the Employment Agreement, to the extent set forth in Section 12 of the
Employment Agreement, shall be conditioned on the Executive's (a) countersigning
the Second Mutual Release within 21 days after receiving it (or, in the event of
the Executive's death or incapacity, such longer period as may be reasonably
necessary for an executor or other personal representative to be appointed) and
(b) not revoking the Second Mutual Release within the 7-day period described in
Section 1(b)(vi) above. The Second Mutual Release shall be dated as of the date
it is countersigned by the Executive, shall not contain the proviso set forth at
the end of Section 1(b)(vi), and shall not contain this Section 3.
4. None of the parties to this Mutual Release, nor their
agents, representatives, or attorneys have made any representations to the other
concerning the terms or effects of this Mutual Release other than those
contained herein.
IN WITNESS WHEREOF, the Parties have executed this Release as
of the date and year first above written.
IKON OFFICE SOLUTIONS, INC.
By:_________________________
Name:
Title:
THE EXCUTIVE
----------------------------
Xxxxx X. Xxxxxx
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