[EXHIBIT 3]
[FORM OF AGREEMENT FOR [9] EXECUTIVES]
EXECUTIVE AGREEMENT dated
[___________________], 1997, between ITT
Corporation, a Nevada corporation ("the
Company"), and _____________________ (the
"Executive").
WHEREAS the Company considers it essential to the best interests of
its shareholders to xxxxxx the continuous employment of key management
personnel; and
WHEREAS the Board of Directors of the Company (the "Board")
recognizes that, as is the case with many publicly-held corporations, the
possibility of a Change in Control (as defined in Section 1(d) hereof) exists
and that such possibility, and the uncertainty and questions which it may raise
among management, may result in the departure or distraction of management
personnel to the detriment of the Company and its shareholders; and
WHEREAS the Board has determined that appropriate steps should be
taken to reinforce and encourage the continued attention and dedication of
members of the Company's management, including the Executive, to their assigned
duties without distraction in the face of potential disturbing circumstances
arising from the possibility of a Change in Control;
NOW THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the Company and the Executive agree as follows:
SECTION 1. Definitions. As used in this Agreement:
(a) "Affiliate" has the meaning ascribed thereto in Rule 12b-2
pursuant to the Securities Exchange Act of 1934, as amended (the "Act").
(b) "Board" means the Board of Directors of the Company.
(c) "Cause" means (i) the willful and continued failure of the
Executive to perform substantially the Executive's duties owed to the Company or
its Affiliates after a written demand for substantial performance is delivered
to the Executive which specifically identifies the nature of such
non-performance, or (ii) conviction of the Executive for a felony.
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No act or omission on the part of the Executive shall be considered "willful"
unless it is done or omitted in bad faith or without reasonable belief that the
action or omission was in the best interests of the Company.
(d) A "Change in Control" shall be deemed to have occurred if:
(i) a report on Schedule 13D shall be filed with the Securities and
Exchange Commission pursuant to Section 13(d) of the Securities Exchange
Act of 1934 (the "Act") disclosing that any person (within the meaning of
Section 13(d) of the Act), other than the Company or a subsidiary of the
Company or any employee benefit plan sponsored by the Company or a
subsidiary of the Company, is the beneficial owner directly or indirectly
of twenty percent of more of the outstanding common stock, no par value
("Stock"), of the Company;
(ii) any person (within the meaning of Section 13(d) of the Act),
other than the Company or a subsidiary of the Company or any employee
benefit plan sponsored by the Company or a subsidiary of the Company,
shall purchase shares pursuant to a tender offer or exchange offer to
acquire any Stock of the Company (or securities convertible into Stock)
for cash, securities or any other consideration, provided that after
consummation of the offer, the person in question is the beneficial owner
(as such term is defined in Rule 13d-3 under the Act), directly or
indirectly, of fifteen percent or more of the outstanding Stock of the
Company (calculated as provided in paragraph (d) of Rule 13d-3 under the
Act in the case of rights to acquire Stock);
(iii) the stockholders of the Company shall approve (A) any
consolidation or merger of the Company in which the Company is not the
continuing or surviving corporation or pursuant to which shares of Stock
of the Company would be converted into cash, securities or other property,
other than a merger of the Company in which holders of Stock of the
Company immediately prior to the merger have the same proportionate
ownership of common stock of the surviving corporation immediately after
the merger as immediately before, or (B) any sale, lease, exchange or
other transfer in one transaction or a series of related transactions of
all or substantially all the assets of the Company; or
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(iv) there shall have been a change in a majority of the members of
the Board within a 12-month period unless the election or nomination for
election by the Company stockholders of each new director during such
12-month period was approved by the vote of two-thirds of the directors
then still in office who were directors at the beginning of such 12-month
period.
(e) "Good Reason" means:
(i) without the Executive's express written consent and excluding
for this purpose an isolated, insubstantial and inadvertent action not
taken in bad faith and which is remedied by the Company or its Affiliates
promptly after receipt of notice thereof given by the Executive, (A) a
reduction in the Executive's Annual Base Salary and Annual Bonus (each as
defined herein) or any reduction in any material compensation or benefits
arrangement, (B) the assignment to the Executive of any duties
inconsistent in any respect with the Executive's position (including
status, offices, titles and reporting requirements), authority, duties or
responsibilities as contemplated by Section 3(a) hereof, (C) any other
action by the Company or its Affiliates which results in a diminution in
such position, authority, duties or responsibilities, or (D) any failure
by the Company to comply with any of the provisions of Section 3(b)
hereof;
(ii) without the Executive's express written consent, the Company's
requiring the Executive's work location to be other than within
twenty-five (25) miles of the location set forth in Section 3(a)(i);
(iii) any failure by the Company to comply with and satisfy Section
10(a).
For purposes hereof, a determination by the Executive that he has "Good
Reason" hereunder shall be final and binding on the parties hereto absent
a showing of bad faith on the Executive's parts.
(f) "Incapacity" means any physical or mental illness or disability
of the Executive which continues for a period of six consecutive months or more
and which at any time after such six-month period the Board shall reasonably
determine renders the Executive incapable of performing his or her duties during
the remainder of the Term.
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(g) "Operative Date" means the date on which a Change in Control
shall have occurred.
SECTION 2. Term of Agreement. This Agreement shall become operative
on the Operative Date and shall remain in effect until the second anniversary of
the Operative Date (the "Term") unless further extended or sooner terminated as
hereinafter provided. Commencing on the second anniversary of the Operative
Date, and each anniversary date thereafter (each, an "Anniversary Date"), the
Term shall automatically be extended for one additional year, unless, not later
than 30 days prior to such Anniversary Date, the Company shall have given notice
to the Executive that it does not wish to extend this Agreement.
SECTION 3. Terms of Employment. (a) Position and Duties. (i) During
the Term: (A) the Executive's position (including status, offices, titles and
reporting requirements), authority, duties and responsibilities shall be at
least commensurate in all material respects with the most significant of those
held, exercised and assigned immediately prior to the Operative Date, and (B)
the Executive's services shall be performed at the location at which the
Executive was based on the Operative Date and the Company shall not require the
Executive to travel on Company business to a substantially greater extent than
required immediately before the Operative Date, except for travel and temporary
assignments which are reasonably required for the full discharge of the
Executive's responsibilities and which are consistent with the Executive's being
so based.
(ii) During the Term, and excluding any periods of vacation and sick
leave to which the Executive is entitled in accordance with Company policy, the
Executive agrees to devote reasonable attention and time during normal business
hours to the business and affairs of the Company and, to the extent necessary to
discharge the responsibilities assigned to the Executive hereunder, to use the
Executive's reasonable best efforts to perform faithfully and efficiently such
responsibilities.
(b) Compensation. (i) Salary and Bonus. During the first year of the
Term, the Executive will receive compensation at an annual rate equal to the sum
of (A) an annual salary ("Annual Base Salary") not less than the Executive's
annualized salary in effect immediately prior to the Operative Date, plus (B) a
bonus ("Annual Bonus") not less than the aggregate amount of the Executive's
highest
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bonus award under the ITT Annual Performance-Based Incentive Plan for Executive
Officers or any substitute or successor plan in respect of the last three
calendar years preceding the Operative Date [(or, if no such award shall have
been made to the Executive prior to the Operative Date, an amount equal to [ ]
of his or her Annual Base Salary)].(1) During the Term, on each anniversary of
the Operative Date, the Executive's compensation in effect on such anniversary
date shall be increased for the following twelve-month period by not less than
the higher of (A) 5% or (B) 80% of the percentage change in the Consumer Price
Index (All Urban Consumers) for the twelve month period ended immediately prior
to the month in which such anniversary date occurs.
ii) Employee Benefit Plans. During the Term, the Executive will be
entitled to (A) continue to participate in all 401(k)/savings and retirement
plans, welfare plans, incentive plans, equity-based plans and all other plans,
programs, policies and arrangements generally applicable to full-time officers
or employees of the Company (the "Company Plans"), or (B) participate in
employee benefit plans, programs, policies and arrangements of any successor to
the Company which have benefits that are not less favorable to the Executive.
SECTION 4. Termination of Employment. (a) Death or Incapacity. This
Agreement shall terminate automatically upon the Executive's death during the
Term. This Agreement shall cease and terminate on the date of determination by
the Board that the Incapacity of the Executive has occurred during the Term
("Incapacity Effective Date").
(b) Cause. The Company may terminate the Executive's employment for
Cause, as defined herein. Termination of the Executive for Cause shall not be
effective unless the Board has passed a resolution, duly adopted by the
affirmative vote of not less than three-quarters (3/4) of the entire membership
of the Board at a meeting of the Board which was called and held for the purpose
of considering such termination (after reasonable notice to the Executive and an
opportunity for the Executive, together with the Executive's counsel, to be
heard before the Board, finding that, in the good faith
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(1) Insert only for those executives newly hired who have not yet received a
full year's bonus award.
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opinion of the Board, the Executive was guilty of conduct set forth in clause
(i) or (ii) of the definition of Cause herein, and specifying the particulars
thereof in detail.
(c) Good Reason. The Executive may terminate his or her employment
for Good Reason, as defined herein.
(d) Notice of Termination. Any termination by the Company for Cause
or Incapacity, or by the Executive for Good Reason, shall be communicated by
Notice of Termination to the other party hereto given in accordance with Section
10 of this Agreement. For purposes of this Agreement, a "Notice of Termination"
means a written notice which (i) indicates the specific termination provision in
this Agreement relied upon, (ii) to the extent applicable, sets forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Executive's employment under the provision so indicated,
(iii) in the case of termination by the Company for Cause or for Incapacity,
confirms that such termination is pursuant to a resolution of the Board (which,
in the case of Cause, is pursuant to Section 4(b) hereof), and (iv) if the Date
of Termination (as defined below) is other than the date of receipt of such
notice, specifies the termination date (which date shall be not more than 30
days after the giving of such notice). The failure by the Executive or the
Company to set forth in the Notice of Termination any fact or circumstance which
contributes to a showing of Good Reason, Incapacity or Cause shall not serve to
waive any right of the Executive or the Company, respectively, hereunder or
preclude the Executive or the Company, respectively, from asserting such fact or
circumstance in enforcing the Executive's or the Company's rights hereunder.
(e) Date of Termination. "Date of Termination" means (i) if the
Executive's employment is terminated by the Company for Cause or by the
Executive for Good Reason, the date of receipt of the Notice of Termination or
any later date specified therein, as the case may be, (ii) if the Executive's
employment is terminated by the Company other than for Cause or Incapacity, the
Date of Termination shall be the date on which the Company notifies the
Executive of such termination, and (iii) if the Executive's employment is
terminated by reason of death or Incapacity, the Date of Termination shall be
the date of death of the Executive or the Incapacity Effective Date, as the case
may be.
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SECTION 5. Obligations of the Company Upon Termination. (a)
Termination for Good Reason or for Reasons Other Than for Cause, Death or
Incapacity. If, during the Term, the Company shall terminate the Executive's
employment other than for Cause or Incapacity or the Executive shall terminate
his or her employment for Good Reason:
(i) the Company shall pay to the Executive in a lump sum in cash,
within five business days after the Date of Termination, the aggregate of
the following amounts:
(A) the sum of (1) the Executive's currently effective Annual
Base Salary through the Date of Termination to the extent not
theretofore paid, (2) any compensation previously deferred by the
Executive (together with any accrued interest or earnings thereon)
and any accrued vacation pay, in each case to the extent not
theretofore paid (the sum of the amounts described in clauses (1)
and (2) shall be hereinafter referred to as the "Accrued
Obligations"); and
(B) the amount equal to the product of (1) three(2) and (2)
the sum of (x) the Executive's Annual Base Salary and (y) his or her
Annual Bonus;
(ii) for three years after the Executive's Date of Termination, or
such longer period as may be provided by the terms of the appropriate
Company Plan, the Company shall continue health and life insurance
benefits, perquisites and fringe benefits to the Executive and the
Executive's eligible family members at least equal to those which would
have been provided to them in accordance with the Company Plans if the
Executive's employment had not been terminated or, if more favorable to
the Executive, as in effect generally at any time thereafter, provided,
however, that if the Executive becomes reemployed with another employer
and is eligible to receive health or life insurance or
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(2) For three of the nine executives covered by individual agreements, the
multiplier will be two, rather than three. The executives covered, respectively,
by the 3x and 2x multipliers are set forth on Schedule A hereto.
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benefits, perquisites and fringe benefits under another employer-provided
plan, the benefits described herein shall be secondary to those provided
under such other plan during such applicable period of eligibility;
(iii) the Company shall, at its sole expense as incurred, provide
the Executive with reasonable out-placement services for a period of up
to one year from the Date of Termination, the provider of which shall be
selected by the Executive in his or her sole discretion; and
(iv) to the extent not theretofore paid or provided, the Company
shall timely pay or provide to the Executive any other amounts or benefits
required to be paid or provided or which the Executive is eligible to
receive under any Company Plan, including earned but unpaid stock and
similar compensation (such other amounts and benefits shall be hereinafter
referred to as the "Other Benefits").
(b) Section 280G Cutback. Except as provided in Section 5(c) hereof,
notwithstanding any other provision of this Agreement to the contrary, in the
event that any payment or benefit received or to be received by the Executive in
connection with a Change in Control or the termination of the Executive's
employment (whether pursuant to the terms of this Agreement or any other plan,
arrangement or agreement with the Company, any "person" (as defined in Section
13(d) of the Act) whose actions result in a Change in Control or any person
affiliated with the Company or such person) (all such payments and benefits,
being hereinafter called "Total Payments") would not be deductible (in whole or
part) by the Company, an affiliate or person making such payment or providing
such benefit as a result of section 280G of the Internal Revenue Code of 1986,
as amended ("the Code"), then, to the extent necessary to make such portion of
the Total Payments deductible (and after taking into account any reduction in
the Total Payments provided by reason of section 280G of the Code in such other
plan, arrangement or agreement), (A) the cash portion of the Total Payments
provided in this Section 5 shall first be reduced (if necessary, to zero), and
(B) all other non-cash Total Payments under this Section 5 shall next be reduced
(if necessary, to zero). For purposes of this limitation, (i) no portion of the
Total Payments the receipt or enjoyment of which the Executive shall have
effectively waived in writing prior to the Date of
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Termination shall be taken into account, (ii) no portion of the Total Payments
shall be taken into account which in the opinion of tax counsel selected by the
Company's independent auditors and reasonably acceptable to the Executive does
not constitute a "parachute payment" within the meaning of section 280G(b)(2) of
the Code, including by reason of section 280G(b)(4)(A) of the Code, (iii) those
Total Payments provided under this Section 5 shall be reduced only to the extent
necessary so that the Total Payments (other than those referred to in clauses
(i) or (ii)) in their entirety constitute reasonable compensation for services
actually rendered within the meaning of section 280G(b)(4)(B) of the Code or are
otherwise not subject to disallowance as deductions, in the opinion of the tax
counsel referred to in clause (ii); and (iv) the value of any non-cash benefit
or any deferred payment or benefit included in the Total Payments shall be
determined by the Company's independent auditors in accordance with the
principles of sections 280G(d)(3) and (4) of the Code.
(c) Certain Additional Payments by the Company. (i) Anything in this
Agreement to the contrary notwithstanding and except as set forth in Section
5(c)(v), in the event that it shall be determined that any payment or
distribution by the Company to or for the benefit of the Executive (whether paid
or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise, but determined without regard to any additional payments
required under this Section 5(c)) (a "Payment") would be subject to the excise
tax imposed by Section 4999 of the Code, or that any interest or penalties are
incurred by the Executive with respect to such excise tax (such excise tax,
together with any such interest and penalties, are hereinafter collectively
referred to as the "Excise Tax"), then the Executive shall be entitled to
receive an additional payment (the "Gross-Up Payment") in an amount such that
after payment by the Executive of all Federal, state and local taxes (including
any interest or penalties imposed with respect to such taxes), including,
without limitation, any income and employment taxes (and any interest and
penalties imposed with respect to such taxes) and Excise Tax imposed upon the
Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal
to the Excise Tax imposed upon the Payments. Notwithstanding the foregoing
provisions of this Section 5(c)(i), if it shall be determined that the Executive
is entitled to the Gross-Up Payment, but that the Executive, after taking into
account the Payments and the Gross-Up Payment, would not
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receive a net after-tax benefit of at least $50,000 (taking into account both
income taxes and any Excise Tax) as compared to the net after-tax proceeds to
the Executive resulting from an elimination of the Gross-Up Payment and a
reduction of the Payments, in the aggregate, to an amount (the "Reduced Amount")
such that the receipt of Payments would not give rise to any Excise Tax, then no
Gross-Up Payment shall be made to the Executive and the Payments, in the
aggregate, shall be reduced to the Reduced Amount.
(ii) Subject to the provisions of Section 5(c)(iii), all
determinations required to be made under this Section 5(c), including whether
and when the Gross-Up Payment is required and the amount of such Gross-Up
Payment, and the assumptions to be utilized in arriving at such determinations
shall be made by a nationally recognized certified public accounting firm as may
be jointly designated by the Executive and the Company (the "Accounting Firm")
which shall provide detailed supporting calculations both to the Company and the
Executive within 15 business days of the receipt of notice from the Executive
that there has been a Payment, or such earlier time as is requested by the
Company. All fees and expenses of the Accounting Firm shall be borne solely by
the Company. Any Gross-Up Payment shall be paid by the Company to the Executive
within five days of the receipt of the Accounting Firm's determination. Any
determination by the Accounting Firm shall be binding upon the Company and the
Executive. As a result of uncertainty in the application of Section 4999 of the
Code at the time of the initial determination by the Accounting Firm hereunder,
it is possible that the Gross-Up Payment made will have been an amount less than
the Company should have paid pursuant to this Section 5(c)(ii) (the
"Underpayment"). In the event that the Company exhausts its remedies pursuant to
Section 5(c)(iii) and the Executive thereafter is required to make a payment of
any Excise Tax, the Accounting Firm shall determine the amount of the
Underpayment and any such Underpayment shall be promptly paid by the Company to
or for the benefit of the Executive.
(iii) The Executive shall notify the Company in writing of any claim
by the Internal Revenue Service that, if successful, would require the payment
by the Company of the Gross-Up Payment. Such notification shall be given as soon
as practicable but no later than ten business days after the Executive is
informed in writing of such claim and shall apprise the Company of the nature of
such claim and the date on which such claim is requested to be paid. The
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Executive shall not pay such claim prior to the expiration of the 30-day period
following the date on which he or she gives such notice to the Company (or such
shorter period ending on the date that any payment of taxes with respect to such
claim is due). If the Company notifies the Executive in writing prior to the
expiration of such period that it desires to contest such claim, the Executive
shall:
(A) give the Company any information reasonably requested by the
Company relating to such claim,
(B) take such action in connection with contesting such claim as the
Company shall reasonably request in writing from time to time, including,
without limitation, accepting legal representation with respect to such
claim by an attorney reasonably selected by the Company,
(C) cooperate with the Company in good faith in order effectively to
contest such claim, and
(D) permit the Company to participate in any proceedings relating to
such claim;
provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify the Executive for and hold the Executive
harmless from, on an after-tax basis, any Excise Tax or income tax (including
interest and penalties with respect thereto) imposed as a result of such
representation and payment of costs and expenses. Without limitation on the
foregoing provisions of this Section 5(c)(iii), the Company shall control all
proceedings taken in connection with such contest and, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its
sole option, either direct the Executive to pay the tax claimed and xxx for a
refund or contest the claim in any permissible manner, and the Executive agrees
to prosecute such contest to a determination before any administrative tribunal,
in a court of initial jurisdiction and in one or more appellate courts, as the
Company shall determine; provided, however, that if the Company directs the
Executive to pay such claim and xxx for a refund, the Company shall advance the
amount of such payment to the Executive, on an interest-free basis, and shall
indemnify the Executive for and hold the Executive
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harmless from, on an after-tax basis, any Excise Tax or income tax (including
interest or penalties with respect thereto) imposed with respect to such advance
or with respect to any imputed income with respect to such advance; and further
provided that any extension of the statute of limitations relating to the
payment of taxes for the taxable year of the Executive with respect to which
such contested amount is claimed to be due is limited solely to such contested
amount. Furthermore, the Company's control of the contest shall be limited to
issues with respect to which a Gross-Up Payment would be payable hereunder and
the Executive shall be entitled to settle or contest, as the case may be, any
other issue raised by the Internal Revenue Service or any other taxing
authority.
(iv) If, after the receipt by the Executive of an amount advanced by
the Company pursuant to Section 5(c)(iii), the Executive becomes entitled to
receive any refund with respect to such claim, the Executive shall (subject to
the Company's complying with the requirements of Section 5(c)(iii)) promptly pay
to the Company the amount of such refund (together with any interest paid or
credited thereon after taxes applicable thereto). If, after the receipt by the
Executive of an amount advanced by the Company pursuant to Section 5(c)(iii), a
determination is made that the Executive shall not be entitled to any refund
with respect to such claim and the Company does not notify the Executive in
writing of its intent to contest such denial of refund prior to the expiration
of 30 days after such determination, then such advance shall be forgiven and
shall not be required to be repaid and the amount of such advance shall offset,
to the extent thereof, the amount of Gross-Up Payment required to be paid.
(v) Notwithstanding anything in this Section 5(c) to the contrary,
this section 5(c) shall only become effective if the closing price per share of
Company common stock, no par value, as reported on the New York Stock Exchange
Composite Tape, remains, for five consecutive trading days following February
[11], 1997, at or above the price at which two-thirds of the award of
performance-based options granted by the Company on February 4, 1997 to senior
executives of the Company will vest by their terms (the "Target Price"), such
Target Price to be adjusted for any stock split, stock dividend or other merger,
reorganization, recapitalization or other business combination effectuated after
the date of execution of this Agreement.
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(d) Death or Incapacity. If the Executive's employment is terminated
by reason of the Executive's death or Incapacity during the Employment Period,
this Agreement shall terminate without further obligations to the Executive's
legal representatives under this Agreement, other than for (i) timely payment of
Accrued Obligations and Other Benefits, and (ii) provision by the Company of
death benefits or disability benefits for termination due to death or
Incapacity, respectively, in accordance with the Company Plans as in effect
immediately prior to the Operative Date or, if more favorable to the Executive,
at the Executive's Date of Termination.
(e) Cause; Other than for Good Reason. If the Executive's employment
shall be terminated for Cause during the Term, this Agreement shall terminate
without further obligations to the Executive other than timely payment to the
Executive of (x) the Executive's currently effective Annual Base Salary through
the Date of Termination, (y) the amount of any compensation previously deferred
by the Executive, and (z) Other Benefits, in each case to the extent theretofore
unpaid. If the Executive voluntarily terminates employment during the Term,
excluding a termination for Good Reason, this Agreement shall terminate without
further obligations to the Executive, other than for the timely payment of
Accrued Obligations and Other Benefits.
SECTION 6. Non-exclusivity of Rights. Nothing in this Agreement
shall prevent or limit the Executive's continuing or future participation in any
Company Plan and for which the Executive may qualify, nor, subject to Section
15(c), shall anything herein limit or otherwise affect such rights as the
Executive may have under any contract or agreement with the Company or any of
its Affiliates. Amounts which are vested benefits or which the Executive is
otherwise entitled to receive under any Company Plan at or subsequent to the
Date of Termination shall be payable in accordance with such plan, policy,
practice or program or contract or agreement except as explicitly modified by
this Agreement.
SECTION 7. Full Settlement. The Company's obligation to make the
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Company may have against the
Executive or others. In no event shall the Executive be obligated to seek other
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employment or take any other action by way of mitigation of the amounts payable
to the Executive under any of the provisions of this Agreement and such amounts
shall not be reduced, except as explicitly provided in Section 5(a)(iii),
whether or not the Executive obtains other employment. The Company agrees to pay
as incurred, to the full extent permitted by law, all legal fees and expenses
which the Executive may reasonably incur as a result of any contest (regardless
of the outcome thereof) by the Company, the Executive or others of the validity
or enforceability of, or liability under, any provision of this Agreement or any
guarantee of performance thereof.
SECTION 8. 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 or
assets of the Company, by agreement, in form and substance satisfactory to the
Executive, expressly to assume and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform 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 will
be a breach of this Agreement and entitle the Executive to compensation from the
Company in the same amount and on the same terms as the Executive would be
entitled to hereunder had the Company terminated the Executive for reason other
than Cause or Incapacity on the succession date. As used in this Agreement, "the
Company" means the Company as defined in the preamble to this Agreement and any
successor to its business or assets which executes and delivers the agreement
provided for in this Section 10 or which otherwise becomes bound by all the
terms and provisions of this Agreement by operation of law or otherwise.
(b) This Agreement shall be enforceable by the Executive's personal
or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.
SECTION 9. Non-assignability. This Agreement is personal in nature
and neither of the parties hereto shall, without the consent of the other,
assign or transfer this Agreement or any rights or obligations hereunder, except
as provided in Section 8 hereof. Without limiting the foregoing, the Executive's
right to receive payments hereunder shall not be assignable or transferable,
whether by pledge,
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creation of a security interest or otherwise, other than a transfer by his or
her will or by the laws of descent or distribution, and, in the event of any
attempted assignment or transfer by the Executive contrary to this Section, the
Company shall have no liability to pay any amount so attempted to be assigned or
transferred.
SECTION 10. Notices. For the purpose of this Agreement, notices and
all other communications provided for herein shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:
If to the Executive: [Name]
[Address]
If to the Company: ITT Corporation
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Attention: General Counsel
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.
SECTION 11. Operation of Agreement. This Agreement shall be
effective immediately upon its execution and continue to be effective until the
Term expires so long as the Executive is employed by the Company or any of its
Affiliates as of the Operative Date. The provisions of this Agreement do not
take effect until the Operative Date.
SECTION 12. Governing Law. The validity, interpretation,
construction and performance of this Agreement shall be governed by the laws of
the State of New York without reference to principles of conflict of laws.
SECTION 13. Settlement of Disputes; Arbitration. All claims by the
Executive for benefits under this Agreement shall be directed to and determined
by the Board and shall be in writing. Any denial by the Board of a claim for
benefits under this Agreement shall be delivered to the Executive in writing and
shall set forth the specific reasons for the denial and the specific provisions
of this Agreement relied upon. The Board shall afford a reasonable opportunity
to the Executive for a review of the decision
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denying a claim and shall further allow the Executive to appeal to the Board a
decision of the Board within sixty (60) days after notification by the Board
that the Executive's claim has been denied. Any further dispute or controversy
arising under or in connection with this Agreement shall be settled exclusively
by arbitration in [New York City, New York] in accordance with the rules of the
American Arbitration Association then in effect. Judgment may be entered on the
arbitrator's award in any court having jurisdiction; provided, however, that the
Executive shall be entitled to seek specific performance of the Executive's
right to be paid until the Date of Termination during the pendency of any
dispute or controversy arising under or in connection with this Agreement. All
costs of arbitration shall be borne by the Company.
SECTION 14. Miscellaneous. (a) This Agreement contains the entire
understanding with the Executive with respect to the subject matter hereof and
supersedes any and all prior agreements or understandings, written or oral,
relating to such subject matter. No provisions of this Agreement may be
modified, waived or discharged unless such modification, waiver or discharge is
agreed to in writing signed by the Executive and the Company.
(b) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement.
(c) Except as provided herein, this Agreement shall not be construed
to affect in any way any rights or obligations in relation to the Executive's
employment by the Company or any of its Affiliates prior to the Operative Date
or subsequent to the end of the Term.
(d) 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 same Agreement.
(e) The Company may withhold from any benefits payable under this
Agreement all Federal, state, city or other taxes as shall be required pursuant
to any law or governmental regulation or ruling.
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(f) The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered as of the day and year first above set forth.
ITT CORPORATION
by
------------------------------------
Name:
Title:
-----------------------------------------
(Name of Executive)
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Schedule A
A. Executives entitled to 3x multiplier under
Section 5(a)(i)(B) of the Agreement--
Xxxxxx, Xxxxxx X.
Xxxxxxx, Xxxxx X.
Xxxxxx, Xxxxxx X.
Xxxxx, Xxx X.
Xxxx, Xxxxxxx X.
Xxxxxxx, Xxxxxx P.
B. Executives entitled to 2x multiplier under
Section 5(a)(i)(B) of the Agreement--
Xxxxxx, Xxx X.
Xxxxxxx, Xxxx X.
Xxxxxx, Xxxxxxxxx X.
