EMPLOYMENT AGREEMENT
BETWEEN
DENTSPLY INTERNATIONAL INC.
AND
XXXXXXXXXXX X. XXXXX
THIS AGREEMENT is entered into as of November 1, 2002, by and between
DENTSPLY International Inc., a Delaware corporation (the "Company") and
Xxxxxxxxxxx X. Xxxxx, ("Employee").
WHEREAS, it is in the best interest of the Company and Employee that the
terms and conditions of Employee's services be formally set forth:
NOW, THEREFORE, in consideration of the mutual covenants and agreements of
the parties hereto, it is hereby agreed as follows:
1. Services
1.1 The Company shall employ Employee and Employee accepts such employment
and agrees to serve as a Senior Vice President of the Company,
responsible for the business activities and operations assigned by
the Chief Executive Officer and/or the Board of Directors as set
forth in Exhibit A attached hereto, effective as of the date stated
below, and, if elected thereto, as an officer or director of any
Affiliate, for the term and on the conditions herein set forth.
Employee shall be responsible for the activities and duties
presently associated with this position. Employee shall perform
such other services as shall from time to time be assigned to him
by the Board of Directors, the Chief Executive Officer, or the
President of the Company depending on the needs and demands of the
business and the availability of other personnel, provided that
such services shall generally be similar in level of position and
responsibility as those set forth in this Agreement. Employee's
services shall be performed at a location suitable for the
performance of the Employee's assigned duties.
1.2 Employee shall at all times devote his full business time and efforts to
the performance of his duties and to promote the best interests of
the Company and its Affiliates.
2. Period of Employment Employment as Senior Vice President shall begin
and continue from November 1, 2002, and terminate on the happening of
any of the following events:
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2.1 Death The date of death of Employee;
2.2 Termination by Employee Without Good Reason The date specified in a
written notice of termination given to the Company by Employee not
less than 180 days in advance of such specified date, at which date
the Employee's obligation to perform services pursuant to this
Agreement shall cease.
2.3 Termination by Employee with Good Reason Thirty (30) days following the
date of a written notice of termination given to the Company by
Employee within thirty (30) days after any one or more of the
following events have occurred:
(a) failure by the Company to maintain the level of responsibility and
status of the Employee generally similar to those of
Employee's position as of the date of the Agreement, or
(b) a reduction by the Company in Employee's base salary as in effect as of
the date hereof plus all increases thereof subsequent thereto;
other than any reduction implemented as part of a formal
austerity program approved by the Board of Directors of the
Company and applicable to all continuing employees of the
Company, provided such reduction does not reduce Employee's
salary by a percentage greater than the average reduction in
the compensation of all employees who continue as employees of
the Company during such austerity program; or
(c) the failure of the Company to maintain and to continue Employee's
participation in the Company's benefit plans as in effect from
time to time on a basis substantially equivalent to the
participation and benefits of Company employees similarly
situated to the Employee; or
(d) any substantial and uncorrected breach of the Agreement by the Company.
2.4 Termination by the Company Upon written notice of termination given to
Employee by the Company, the Employee's obligation to perform
services pursuant to this Agreement shall cease as of the date of
such notice.
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0. Payments by the Company
3.1 During the Period of Employment, the Company shall pay to the Employee
for all services to be performed by Employee hereunder a salary of
not less than $250,000 per annum, or such larger amount as may from
time to time be fixed by the Board of Directors of the Company or,
if applicable, by the Human Resources Committee of the Board (or
its successor), payable in accordance with the Company's normal pay
schedule.
3.2 During the Period of Employment, Employee shall be entitled to
participate in all plans and other benefits made available by the
Company generally to its domestic executive employees, including
(without limitation) benefits under any pension, profit sharing,
employee stock ownership, stock option, bonus, performance stock
appreciation right, management incentive, vacation, disability,
annuity, or insurance plans or programs. Any payments to be made
to Employee under other provisions of this Section 3 shall not be
diminished by any payments made or to be made to Employee or his
designees pursuant to any such plan, nor shall any payments to be
made to Employee or his designees pursuant to any such plan be
diminished by any payment made or to be made to Employee under
other provisions of this Section 3.
3.3 Upon termination of the Period of Employment for whatever reason,
Employee shall be entitled to receive the compensation accrued and
unpaid as of the date of his termination. If Employee at the time
of termination is eligible to participate in any Company incentive
or bonus plan then in effect, Employee shall be entitled to receive
a pro-rata share of such incentive or bonus award based upon the
number of days he is employed during the plan year up to the date
of his termination. Such pro-rata amount shall be calculated in
the usual way and paid at the usual time.
3.4 If the Period of Employment terminates upon the death of Employee, the
Company shall continue payment of his then current salary for a
period of 12 months from the date of death, together with his
pro-rata share of any incentive or bonus payments due for the
period prior to his death, to Employee's designated beneficiary or,
if no beneficiary has been effectively designated, then to
Employee's estate.
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3.5 If the Period of Employment is terminated by the Employee under Section
2.3, or by the Company under Section 2.4, the Company shall
continue to pay compensation and provide benefits to the employee
as provided in this Section 3.5 for a period (the "Termination
Period") beginning on the date of the termination notice and ending
on the earlier of: (i) the second annual anniversary of the date
of such termination notice; or (ii) the date on which the Employee
would attain age 65, as follows:
(a) Compensation shall be paid to the Employee at the rate of salary being
paid to Employee under Section 3.1 immediately before the
termination;
(b) Bonus and incentive compensation shall be paid to the Employee in
accordance with plans approved by the Board of Directors and
similar to those in which the Employee participated at time of
termination, using the same formula and calculations as if
termination had not occurred. The Employee shall not be
entitled to receive any further grants of stock options under
any stock option or similar such plan subsequent to the date
of termination, but outstanding stock options shall continue
to vest during the Termination Period in accordance with the
applicable stock option plan;
(c) Employee shall receive the benefits that would have been accrued by the
Employee during the Termination Period from participation by
the Employee under any pension, profit sharing, employee stock
ownership plan ("ESOP") or similar retirement plan or plans of
the Company or any Affiliate in which the Employee
participated immediately before the termination, in accordance
with the terms of any such plan (or, if not available, in lieu
thereof be compensated for such benefits), based on service
the Employee would have had during the Termination Period and
compensation (and, if applicable, bonus and incentive
compensation) as determined under Section (a) (and, if
applicable, Subsection (b) above);
(d) Employee shall receive continued coverage during the Termination Period
under all employee disability, annuity, insurance, or other
employee welfare benefit plans, programs or arrangements of
the Company or any Affiliate in which Employee participated
immediately before the notice of termination, plus all
improvements subsequent thereto (or, if not available, in lieu
thereof be compensated for such coverage); and
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(e) In the event of the death of Employee during the Termination Period, the
Company shall continue to make payments under Subsection
3.5(a) for the period that is the lesser of the remainder of
the Termination Period or twelve (12) months, and shall pay
any bonuses due under Subsection 3.5(b) on a pro-rata basis
until the date of Employee's death, to Employee's designated
beneficiary or, if no beneficiary has been effectively
designated, then to Employee's estate.
Except as provided in Section 3.6, payment of compensation under
Subsection 3.5(a) above shall be made at the same time as payments
of compensation under Section 3.1, and payments of other benefits
under Subsections 3.5(b) and (c) shall be paid at the same time and
to the same person as compensation or benefits would have been paid
under the plan, program, or arrangement to which they relate (after
taking into account any election made by the Employee with respect
to payments under such plan, program, or arrangement), and shall be
pro-rated for any partial year through the date of expiration of
the Termination Period.
3.6 If at any time after a Change of Control the Period of Employment is
terminated by the Employee under Section 2.3, or the Company
terminates or gives written notice of termination of the Period of
Employment to the Employee (regardless of whether in accordance
with Section 2.4), then in lieu of the periodic payment of the
amounts specified in Subsections 3.5(a), (b), and (c) (except as
may be otherwise prohibited by law or by said plans), the Company,
at the written election of Employee, shall pay to Employee within
five (5) business days of such termination or notice of termination
the present value of the amounts specified in Subsections 3.5(a),
(b), and (c), discounted at the greatest rate of interest then
payable by Mellon Bank (or its successor) on any federally insured
savings account into which Employee could deposit such amount and
make immediate withdrawals therefrom without penalty, and shall
provide for the remainder of the Termination Period, if any, the
benefit coverage required by Subsection 3.5(d). Employee shall not
be required to mitigate damages payable under this Section 3.6.
3.7 In no event will the Company be obligated to continue Employee's
compensation and other benefits under Section 3.5 of this Agreement
beyond Employee's sixty-fifth (65th) birthday or if Employee's
employment is terminated because of gross negligence or significant
willful misconduct (e.g. conviction of misappropriation of
corporate assets or serious criminal offense).
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0. Non-Competition Agreement During the Period of Employment and for a
period of five (5) years after the termination thereof, Employee shall
not, without the written consent of the Company, directly or indirectly
be employed or retained by, or render any services for, or be
financially interested in, any firm or corporation engaged in any
business which is competitive with any business in which the Company or
any of its Affiliates may have been engaged during the Period of
Employment. The foregoing restriction shall not apply to the purchase
by Employee of up to 5% of the outstanding shares of capital stock of
any corporation whose securities are listed on any national securities
exchange.
5. Loyalty Commitments During and after the Period of Employment: (a)
Employee shall not disclose any confidential business information about
the affairs of the Company or any of its Affiliates; and (b) Employee
shall not, without the prior written consent of the Company, induce or
attempt to induce any employee or agency representative of the Company
or any Affiliate to leave the employment or representation of the
Company or such Affiliate.
6. Separability of Provisions The terms of this Agreement shall be
considered to be separable from each other, and in the event any shall
be found to be invalid, it shall not affect the validity of the
remaining terms.
7. Binding Effect This Agreement shall be binding upon and inure to the
benefit of (a) the Company and its successors and assigns, and (b)
Employee, his personal representatives, heirs, and legatees.
8. Entire Agreement This Agreement constitutes the entire agreement
between the parties and supersedes and revokes all prior oral or written
understandings between the parties relating to Employee's employment,
except with respect to matters addressed in the offer letter dated
October , 2002 between the parties to the extent such matters are not
covered in this Agreement. The Agreement may not be changed orally but
only by a written document signed by the party against whom enforcement
of any waiver, change, modification, extension, or discharge is sought.
9. Definitions The following terms herein shall (unless otherwise
expressly provided) have the following respective meanings:
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9.1 "Affiliate" when used with reference to the Company means any
corporations, joint ventures, or other business enterprises
directly or indirectly controlling, controlled by, or under common
control with the Company. For purposes of this definition,
"control" means ownership or power to vote 50% or more of the
voting stock, venture interests, or other comparable participation
in such business enterprises.
9.2 "Period of Employment" means the period commencing on the date hereof
and terminating pursuant to Section 2.
9.3 "Beneficiary" means the person or persons designated in writing by
Employee to Company.
9.4 "Change of Control" means any event by which (i) an Acquiring Person has
become such, or (ii) Continuing Directors cease to comprise a
majority of the members of the Board of Directors of the Company or
the applicable Parent of the Company (a "Board"). For purposes of
this definition:
(a) An "Acquiring Person" means any person or group (as defined in Section
13(d)(3) of the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder as in
effect on the date of this Agreement (the "Exchange Act") who
or which, together with all affiliates and associates (as
defined in Rule 12B-2 under the Exchange Act) becomes, by way
of any transaction, the beneficial owner of shares of the
Company, or such Parent, having 20% or more of (i) the then
outstanding shares of Common Stock of the Company, or such
Parent, or (ii) the voting power of the then outstanding
voting securities of the Company, or such Parent, entitled to
vote generally in the election of directors of the Company or
such Parent; and
(b) "Continuing Director" means any member of a Board, while such person is
a member of such Board who is not an Acquiring Person, or an
affiliate or associate of an Acquiring Person or a
representative of an Acquiring Person or of any such affiliate
or associate and who (i) was a member of such Board prior to
the date of this Agreement, or (ii) subsequently becomes a
member of such Board and whose nomination for election or
election to such Board is recommended or approved by
resolution of a majority of the Continuing Directors or who is
included as a nominee in a proxy statement of the Company or
the applicable Parent distributed when a majority of such
Board consists of Continuing Directors.
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9.5 "Parent" means any Affiliate directly or indirectly controlling (within
the meaning of Section 9.1) the Company.
10. Notices Where there is provision herein for the delivery of written
notice to either of the parties, such notice shall be deemed to have
been delivered for the purposes of this Agreement when delivered in
person or placed in a sealed, postpaid envelope addressed to such party
and mailed by registered mail, return receipt requested to the address
set forth below for the Company and the most recent address as may be on
the Company records for the Employee:
For Company: DENTSPLY International Inc.
000 Xxxx Xxxxxxx Xxxxxx
Xxxx, XX 00000
Attention: Secretary
11. Arbitration Any controversy arising from or related to this Agreement
shall be determined by arbitration in the City of Philadelphia,
Pennsylvania, in accordance with the rules of the American Arbitration
Association, and judgment upon any such determination or award may be
entered in any court having jurisdiction. In the event of any
arbitration between Employee and Company related to the Agreement, if
employee shall be the successful party, Company will indemnify and
reimburse Employee against any reasonable legal fees and expenses
incurred in such arbitration.
12. Applicable Law The Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Pennsylvania.
IN WITNESS WHEREOF, the parties have executed the Agreement on the day and
year first above written.
Attest: DENTSPLY INTERNATIONAL INC.
____________ ___________________ By:____________________________________
Secretary President and Chief Operating Officer
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Xxxxxxxxxxx X. Xxxxx
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EXHIBIT A
BUSINESS RESPONSIBILITIES
o Business Development
o Strategic Planning
o Group Practice Sales
o North American Marketing and Administration
o Alliance
o Federal Sales Government
o Manufacturing and Logistics
o DENTSPLY Xxxxxx & Xxxxxxxx
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