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Exhibit 10.10
EMPLOYMENT AGREEMENT
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THIS AGREEMENT, dated as of January 19, 2000 and effective as of the
Effective Date (as hereinafter defined), is made by and between Dayton Superior
Corporation, an Ohio corporation (the "Company"), and Xxxx X. Xxxxxxxxxx (the
"Executive").
RECITALS:
WHEREAS, the Executive has heretofore been employed by the Company as
Chief Executive Officer; and
WHEREAS, it is the desire of the Company to assure itself of the
continuity of the management services of the Executive following the
consummation of the merger contemplated by the Agreement and Plan of Merger by
and between the Company and Stone Acquisition Corp. dated as of January 19, 2000
(the "Merger Agreement"); and
WHEREAS, the Company and the Executive intend this Agreement to be
effective as of the consummation of the merger contemplated in the Merger
Agreement (the "Effective Date"); and
WHEREAS, the Company and the Executive intend that if the merger
contemplated in the Merger Agreement is not consummated, this Employment
Agreement shall be of no force or effect;
NOW, THEREFORE, in consideration of the foregoing and of the respective
covenants and agreements set forth below, the parties hereto agree as follows:
1. CERTAIN DEFINITIONS.
(a) "ANNUAL BASE SALARY" shall have the meaning set forth in Section
4(a).
(b) "BOARD" shall mean the Board of Directors of the Company.
(c) The Company shall have "CAUSE" to terminate the Executive's
employment and/or service as non-executive Chairman hereunder upon the
Executive's:
(i) willful or gross misconduct or material failure in the
performance of his duties and responsibilities hereunder, other than
any such failure resulting from the Executive's Disability, which
misconduct or failure continues beyond 14 days after the company
notifies the Executive, in writing, of the Company's finding of such
misconduct or failure; or
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(ii) conviction of or plea of guilty or nolo contendre to, a
felony, or a crime involving moral turpitude; or
(iii) fraud or personal dishonesty involving the Company's assets.
(d) "CHANGE IN CONTROL" shall mean a change in ownership or control of
the Company effected through a transaction or series of transactions (other than
an offering of Common Stock to the general public through a registration
statement filed with the Securities and Exchange Commission) whereby any
"person" or related "group" of "persons" (as such terms are used in Sections
13(d) and 14(d)(2) of the Exchange Act) (other than the Company, any of its
subsidiaries, an employee benefit plan maintained by the Company or any of its
subsidiaries, a Principal Stockholder or a "person" that, prior to such
transaction, directly or indirectly controls, is controlled by, or is under
common control with, the Company or a Principal Stockholder) directly or
indirectly acquires beneficial ownership (within the meaning of Rule 13d-3 under
the Exchange Act) of securities of the Company possessing more than fifty
percent (50%) of the total combined voting power of the Company's securities
outstanding immediately after such acquisition.
(e) "COMMON STOCK" shall mean the common shares of the Company, without
par value.
(f) "COMPANY" shall have the meaning set forth in the preamble hereto.
(g) "COMPENSATION COMMITTEE" shall mean the Compensation Committee of
the Board whose members shall be appointed by the Board from time to time and
shall initially include Xxxxxxx Xxxxxxx, as Chairman, Xxxxxxxx Xxxxx and Xxxxxxx
Xxxxxxxx.
(h) "DATE OF TERMINATION" shall mean (i) if the Executive's employment
is terminated by reason of his death, the date of his death, and (ii) if the
Executive's employment is terminated pursuant to Sections 5(a)(ii) - (viii), the
date specified in the Notice of Termination; PROVIDED, HOWEVER, that, as set
forth in Section 4(k)(i)(A), for purposes of the Management Stockholders'
Agreement, the Executive shall not be deemed to have incurred a termination of
employment upon the commencement of the Non-Executive Term, if any, and
PROVIDED, FURTHER, that as set forth in Section 4(k)(i)(B) the date of
termination of employment for purposes of the Management Stockholders' Agreement
shall be the date of termination of the Non-Executive Term, if any.
(i) "DISABILITY" shall mean the inability of the Executive to perform
his duties and responsibilities as an officer or employee of the Company or any
of its subsidiaries on a full-time basis for more than six months within any
12-month period because of a physical, mental or emotional incapacity resulting
from injury, sickness or disease.
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(j) "EBITDA" with respect to any period of determination shall mean the
sum of the following (without duplication): (i) consolidated net income (or
loss) of the Company and, if applicable, its subsidiaries for such period
(exclusive of the effect of extraordinary items), as determined by the Company's
independent certified public accountants in accordance with generally accepted
accounting principles consistently applied, as such principles are in effect at
the date hereof, plus (ii) amounts deducted from net revenues in determining
such net income (or loss) on account of (w) depreciation and amortization, (x)
interest expense (net of interest income), (y) all taxes on income and (z) any
management or acquisition fee charged to the Company by the Principal
Stockholder.
(k) "EFFECTIVE DATE" shall have the meaning set forth in the recitals
hereto.
(l) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended.
(m) "EXECUTIVE" shall have the meaning set forth in the preamble
hereto.
(n) "EXERCISABLE OPTIONS" as of any date of determination, shall mean
those Options (or portions thereof) held by the Executive that are then vested
and exercisable.
(o) "FAIR MARKET VALUE" shall have the meaning ascribed to such term
under the Management Stockholders' Agreement.
(p) "GOOD REASON" shall mean the occurrence of any of the following:
(i) a material diminution in the Executive's title, duties or responsibilities,
without his prior written consent, (ii) a reduction of the Executive's aggregate
cash compensation (including bonus opportunities), benefits or perquisites,
without his prior written consent or (iii) the occurrence of a Change in
Control.
(q) "MANAGEMENT STOCKHOLDERS' AGREEMENT" shall mean that certain
Management Stockholders' Agreement to be entered into by and among the Company,
Odyssey Investment Partners Fund, LP, the Executive and the other employee
stockholders party thereto, effective as of the Effective Date, the terms of
which have previously been accepted by the Executive pursuant to that certain
letter agreement and Management Compensation and Equity Term Sheet dated as of
the date hereof.
(r) "MERGER AGREEMENT" shall have the meaning set forth in the recitals
hereto.
(s) "NOTICE OF TERMINATION" shall have the meaning set forth in Section
5(b).
(t) "NON-EXECUTIVE TERM" shall have the meaning set forth in Section
2(b).
(u) "OPTION AGREEMENTS" shall mean the written agreements between the
Company and the Executive pursuant to which the Executive holds or is granted
options to purchase
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Common Stock, including, without limitation, agreements evidencing options
granted under the Option Plan and agreements governing the terms of "Roll-Over
Options" (as defined in the Management Stockholders' Agreement).
(v) "OPTION PLAN" shall mean the 2000 Stock Option Plan of Dayton
Superior Corporation, as amended from time to time.
(w) "OPTIONS" as of any date of determination shall mean options held
by the Executive as of such date to purchase Common Stock of the Company.
(x) "PRINCIPAL STOCKHOLDER" shall mean Odyssey Investment Partners
Fund, LP and any of its Permitted Assignees (as such term is defined in the
Management Stockholders' Agreement).
(y) "PROHIBITED COMPETITION" shall have the meaning set forth in
Section 8(b).
(z) "RETIREMENT" shall mean the voluntary termination of the
Executive's services with the Company as a result of his retirement from active
service as the President and Chief Executive Officer of the Company upon or
after the third anniversary of the Effective Date; PROVIDED, HOWEVER, that as
set forth in Section 4(k)(i)(A), for purposes of the Management Stockholders'
Agreement, the Executive shall not be deemed to have incurred a "Retirement"
upon the commencement of the Non-Executive Term, if any, and PROVIDED, FURTHER,
that as set forth in Section 4(k)(i)(C), for purposes of the Management
Stockholders' Agreement, the last day of the Non-Executive Term, if any, shall
be deemed the date of the Executive's termination of employment either by reason
of "Retirement" or "Termination by the Company for Cause" as the case may be.
(aa) "TERM" shall have the meaning set forth in Section 2(a).
2. EMPLOYMENT.
(a) The Company shall continue to employ the Executive and the
Executive shall remain in the employ of the Company, for the period set forth in
this Section 2, in the positions set forth in Section 3 and upon the other terms
and conditions herein provided. The initial term of employment under this
Agreement (the "Initial Term") shall be for the period beginning on the
Effective Date and ending on the third anniversary thereof unless earlier
terminated as provided in Section 5; PROVIDED, HOWEVER, that unless so earlier
terminated or unless the Executive or the Company shall give written notice to
the other of his or its intention not to renew this Agreement no less than sixty
days prior to the scheduled expiration thereof, upon the third anniversary of
the Effective Date, this Agreement shall automatically be renewed for an
additional two year period (the "Extension Term" and collectively with the
Initial Term, the "Term").
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(b) At any time prior to the scheduled expiration of the Initial Term (or of the
Extension Term, if any), the Company and the Executive may mutually agree that
effective as of such scheduled expiration date the Executive shall resign as the
President and Chief Executive Officer of the Company but continue to provide
services to the Company as a non-executive Chairman, in which case the Executive
shall be entitled to compensation for his services commensurate with his duties
and responsibilities to the Company, as mutually agreed to by the Company and
the Executive at such time. The period of time, if any, during which the
Executive serves as non-executive Chairman shall be referred to as the
"Non-Executive Term." The Non-Executive Term shall terminate upon the date the
Executive ceases to serve as non-executive Chairman for any reason, including
but not by way of limitation, a termination by resignation, removal, failure to
be elected or appointed, death or retirement.
3. POSITION AND DUTIES.
(a) During the Term, the Executive shall serve as the Chairman of the
Board, President and Chief Executive Officer of the Company with such customary
responsibilities, duties and authority as may from time to time be assigned to
the Executive by the Board. During the period of the Executive's active
employment as President and Chief Executive Officer, the Executive shall devote
substantially all his working time and efforts to the business and affairs of
the Company; PROVIDED, that it shall not be considered a violation of the
foregoing for the Executive to (i) with the prior consent of the Board (which
consent shall not unreasonably be withheld), serve on corporate, industry, civic
or charitable boards or committees and (ii) manage his personal investments, so
long as none of such activities significantly interferes with the Executive's
duties hereunder.
(b) The Executive shall serve as the Chairman of the Board during the
Term and during the Non-Executive Term, if any. During the Term, the Board shall
propose the Executive for re-election to the Board and the Principal
Stockholders shall vote all of their shares of Common Stock in favor of such
re-election. If elected or appointed thereto, and only for the duration of such
elected term or appointment, the Executive shall also serve as a director of any
of the Company's subsidiaries and/or in one or more executive offices of any
entities owned by the Company.
4. COMPENSATION AND RELATED MATTERS.
(a) ANNUAL BASE SALARY. During the Term, the Executive shall receive a
base salary at a rate that is no less than $350,000 per annum (the "Annual Base
Salary"), payable in accordance with the Company's normal payroll practices. The
rate of the Annual Base Salary shall be reviewed by the Compensation Committee
on or prior to each anniversary of the Effective Date during the Term and may be
increased, but not decreased, upon such review.
(b) BONUS. For each fiscal year during the Term, the Executive shall be
eligible to participate in the Company's annual cash bonus plan in accordance
with terms and provisions
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which shall be consistent with the Company's executive bonus policy in effect as
of the Effective Date.
(c) LONG TERM INCENTIVE COMPENSATION. During the Term, the Executive
shall be entitled to participate in the Option Plan or any successor plan
thereto.
(d) BENEFITS. During the Term, the Executive shall be entitled to
participate in the employee benefit plans, programs and arrangements of the
Company in effect as of the date hereof (or, to the extent determined by the
Board or Compensation Committee, in effect hereafter) which are applicable to
the senior officers of the Company generally, subject to and on a basis
consistent with the terms, conditions and overall administration thereof.
Furthermore, during the first 12 months of the Term following the Effective
Date, the benefits provided under such employee benefit plans, programs and
arrangements (other than any stock option, restricted stock or other equity
based plan) shall, in the aggregate, be substantially equivalent to the benefits
provided by the Company as of the Effective Date (other than pursuant to any
stock option, restricted stock or other equity based plan).
(e) EXPENSES. Pursuant to the Company's customary policies in force at
the time of payment, the Executive shall be reimbursed for all expenses properly
incurred by the Executive on the Company's behalf in the performance of the
Executive's duties hereunder.
(f) VACATION. During the Term, the Executive shall be entitled to an
amount of annual vacation days, and to compensation in respect of earned but
unused vacation days in accordance with the Company's vacation policy as in
effect as of the Effective Date. The Executive shall also be entitled to paid
holidays in accordance with the Company's practices with respect to same as in
effect as of the Effective Date.
(g) AUTOMOBILE. During the Term, the Company shall provide the
Executive with an annual automobile allowance at a rate not less than that in
effect as of the Effective Date.
(h) CLUB MEMBERSHIP. During the Term, the Company shall pay on behalf
of the Executive, or reimburse the Executive for, annual membership fees payable
in connection with the Executive's membership in two country, alumni, or social
clubs of the Executive's choice.
(i) TAX AND FINANCIAL PLANNING ASSISTANCE. During the Term, the Company
shall, upon submission of proper documentation, pay on behalf of the Executive,
or reimburse the Executive for, reasonable expenses incurred for professional
assistance in planning and preparing his tax returns and managing his financial
affairs, consistent with the Company's practices as in effect on the date of
execution of this Agreement.
(j) LOAN TO PURCHASE SHARES OF COMMON STOCK. In the event that during
the Term or the Non-Executive Term, if any, the Executive elects to purchase
shares of Common Stock pursuant to the Management Stockholders' Agreement, the
Company shall, or shall cause one of
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its affiliates to, lend to the Executive up to $500,000 in the aggregate (or
such greater amount as determined by the Compensation Committee in its
discretion) as payment for such shares pursuant to the terms of a secured,
recourse promissory note or notes bearing interest of the lowest rate specified
pursuant to Section 1274 of the Internal Revenue Code so as to avoid imputed
interest, and the parties shall enter into security agreement(s) under which the
Executive shall pledge such shares to the Company (or affiliate thereof, as
applicable) as security for repayment of such loan(s). Any interest due on such
loan shall be converted into principal and shall not be payable currently as it
is accrued, but rather shall be payable when the underlying shares are sold. Any
such note and security agreement shall have terms consistent with the forgoing
and shall be in a form acceptable to the Company's (or its affiliate's) lenders
under the terms of the Financing Documents (as such term is defined in the
Management Stockholders' Agreement).
(k) RIGHT OF THE EXECUTIVE TO SELL COMMON STOCK TO THE COMPANY.
(i) For purposes of the Management Stockholders' Agreement, (A) if
the Company and the Executive mutually agree to permit the Executive to
resign as President and Chief Executive Officer but to continue to
provide services to the Company as non-executive Chairman pursuant to
Section 2(b), such resignation shall not constitute a resignation,
"Retirement" or other termination of employment thereunder; (B) the
date on which the Executive ceases to serve as non-executive Chairman
shall be deemed to be the date of his termination of employment for
purposes of the Management Stockholders' Agreement and (C) (I) unless
he shall have been removed from such position for Cause, for purposes
of the Management Stockholders' Agreement, the Executive shall be
deemed to have terminated employment by reason of "Retirement" and (II)
if he shall have been removed from such position for Cause, for
purposes of the Management Stockholders' Agreement, the Executive shall
be deemed to have terminated employment by reason of termination by the
Company for Cause.
(ii) If the Executive remains employed by the Company through the
scheduled expiration of the Initial Term, then subject to the
Management Stockholders' Agreement, for the two-year period following
such date (the "Put Period"), the Executive shall have the right to
sell to the Company, and the Company shall have the obligation to
purchase from the Executive, at the Fair Market Value per share, that
number of shares of Common Stock not to exceed in the aggregate 80% of
the sum of (A) the number of shares of Common Stock held by the
Executive as of the third anniversary of the Effective Date and (B) the
number of shares of Common Stock that could be acquired by the
Executive upon the exercise of Exercisable Options as of such date (the
"Aggregate Stock"), in accordance with the provisions of this Section
4(k)(ii) (the "Executive Put"). The Executive shall have the right to
exercise the Executive Put at any time during the Put Period as of
which EBITDA for the fiscal year ending December 31, 2002 or for any
four consecutive fiscal quarters thereafter equals or exceeds $72.4
million (excluding the
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effect of acquisitions completed after the execution date of this
Agreement); PROVIDED, HOWEVER, that (x) the Executive may not exercise
the Executive Put within six months following a prior exercise of the
Executive Put; (y) the Executive Put may not be exercised for less than
10% of the Aggregate Stock and (z) the Executive Put may only be
exercised with respect to shares which the Executive has held for at
least six months. If the Executive desires to exercise the Executive
Put pursuant to this Section 4(k)(ii), he shall notify the Company in
writing, specifying the number of shares to be sold pursuant to the
exercise of the Executive Put hereunder. Subject to the Management
Stockholders' Agreement, payment for shares of Common Stock sold by the
Executive pursuant to this Section 4(k)(ii) shall be made on or prior
to the date 60 days (or the first business day thereafter if the 60th
day is not a business day) following the date of the receipt by the
Company of the Executive's notice described herein; PROVIDED, HOWEVER,
that if such payment is being made on or after the first day of the
seventh month of any fiscal year, then such payment shall be made on or
prior to the date that is 60 days (or the first business day thereafter
if the 60th day is not a business day) following the date of the
determination of Fair Market Value in a manner consistent with the
provisions of the Management Stockholders' Agreement.
(iii) If the Executive holds Exercisable Options as of the date he
notifies the Company of the exercise of the Executive Put pursuant to
Section 4(k)(ii) and together with such notice notifies the Company
that he desires to exercise a specified portion of such Exercisable
Options (the "Specified Options"), the Company shall, or shall cause an
affiliate of the Company to, lend to the Executive within 30 days after
the Company's receipt of such notice from the Executive an amount equal
to the aggregate exercise price payable with respect to the Specified
Options and the aggregate federal, state and local income tax
liability, including any alternative minimum tax obligations, that will
actually be incurred by the Executive as a result of his exercise of
the Specified Options in accordance with such notice. Any such loan
pursuant to this Section 4(k)(iii) shall be pursuant to the terms of a
secured, recourse promissory note or notes which (i) shall be payable
in full no later than the earliest of (A) the date on which the
Executive receives any payment from the Company for the repurchase of
the shares acquired upon exercise of the Specified Options, (B) the
date on which the Executive transfers any such shares and (C) the first
date following the expiration of the Put Period, (ii) shall bear
interest at the applicable federal mid-term rate determined pursuant to
Section 1274(d) of the Internal Revenue Code of 1986, as amended, (iii)
shall provide that any interest due on such loan shall be converted
into principal and shall not be payable currently as it is accrued, but
rather shall be payable when the principal amount is due and (iv) shall
be in a form acceptable to the Company's (or its affiliate's) lenders
under the terms of the Financing Documents. The parties hereto agree
that to the extent any of the foregoing provisions of this Section
4(k)(iii) result in adverse accounting consequences to the Company,
such provisions shall be modified in a manner mutually acceptable to
the parties hereto.
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5. TERMINATION.
(a) The Executive's employment hereunder may be terminated by the
Company or the Executive, as applicable, without any breach of this Agreement
only under the following circumstances and in accordance with subsection (b):
(i) DEATH. The Executive's employment hereunder shall terminate
upon his death.
(ii) DISABILITY. If the Company determines in good faith that the
Executive has incurred a Disability, the Company may give the Executive
written notice of its intention to terminate the Executive's
employment. In such event, the Executive's employment with the Company
shall terminate effective on the 30th day after receipt of such Notice
of Termination by the Executive, provided that within such 30 day
period the Executive shall not have returned to full-time performance
of his duties.
(iii) TERMINATION FOR CAUSE. The Company may terminate the
Executive's employment hereunder for Cause.
(iv) RESIGNATION FOR GOOD REASON. The Executive may terminate his
employment hereunder for Good Reason.
(v) TERMINATION WITHOUT CAUSE. The Company may terminate the
Executive's employment hereunder without Cause.
(vi) RESIGNATION WITHOUT GOOD REASON. The Executive may resign his
employment hereunder without Good Reason.
(vii) RETIREMENT. The Executive may elect to terminate his
employment by reason of retirement effective no earlier than the third
anniversary of the Effective Date.
(b) NOTICE OF TERMINATION. Any termination of the Executive's
employment by the Company or by the Executive under this Section 5 (other than
termination pursuant to subsection (a)(i)) shall be communicated by a written
notice from the Board or the Executive to the other, indicating the specific
termination provision in this Agreement relied upon, setting 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, and specifying a
Date of Termination (a "Notice of Termination"). For purposes of this Agreement,
the "Date of Termination" shall be (i) with respect to any termination by reason
of the Executive's Disability, 30 days following the receipt of the notice
described in Section 5(a)(ii); (ii) with respect to the Executive's termination
for Cause, the date of the Notice of Termination, and (iii) with respect to the
Executive's termination of employment for any other reason, at least 30 days
following the date of the Notice of Termination. The Executive shall continue to
receive his Annual Base Salary, annual bonus
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and all other compensation and perquisites referenced in Section 4 through the
Date of Termination.
6. SEVERANCE PAYMENTS.
(a) TERMINATION FOR ANY REASON. In the event the Executive's employment
with the Company is terminated for any reason, the Company shall pay the
Executive (or his beneficiary in the event of his death) any unpaid Annual Base
Salary that has accrued as of the Date of Termination, any unreimbursed expenses
due to the Executive and an amount for accrued but unused sick days and vacation
days. The Executive shall also be entitled to accrued, vested benefits under the
Company's benefit plans and programs as provided therein. The Executive shall be
entitled to the additional payments and benefits described below only as set
forth herein.
(b) TERMINATION WITHOUT CAUSE, RESIGNATION FOR GOOD REASON OR
TERMINATION BY REASON OF DEATH OR DISABILITY. In the event of the Executive's
Termination without Cause (pursuant to Section 5(a)(v)), Resignation for Good
Reason (pursuant to Section 5(a)(iv)) or termination by reason of Death or
Disability (pursuant to Section 5(a)(i) or (ii), respectively), the Company
shall pay to the Executive the amounts described in subsection (a), and:
(i) subject to the Executive's compliance with Sections 8 and 9,
pay to the Executive, for the twenty-four month period following the
Date of Termination, in accordance with its regular payroll practice,
his Annual Base Salary as in effect on the Date of Termination; and
(ii) for the year in which the termination occurs, pay to the
Executive a pro-rated amount of bonus based on the Company's executive
annual bonus plan as in effect at that time; and
(iii) continue for one year the Executive's coverage under the
Company medical and dental plans and programs in which the Executive
was entitled to participate immediately prior to the Date of
Termination (or, if the Company amends, replaces or terminates any such
plan or program following such Date of Termination, the Company medical
and dental plans provided to employees similarly situated to
Executive), as if the Executive were an active employee during such
time, subject to standard employee contributions by the Executive as
are required under such plans, and further subject to the Executive's
election of "COBRA" continuation coverage during such period. All
post-employment coverage under such plans shall be co-extensive with
COBRA continuation coverage required by federal (and where applicable
by state) law, and shall cease if the Executive becomes eligible for
coverage under another employer's plans.
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7. OTHER TERMINATION PROVISIONS.
Notwithstanding any provision of this Agreement or the Management
Stockholders' Agreement to the contrary, in the event that as a consequence of a
termination of the Executive's employment for any reason, the Executive is
compelled to exercise any Options in order to prevent such Options from expiring
in accordance with their terms and the Company is unable to repurchase the
Executive's stock at such time, the Company shall either (i) provide the
Executive with an interest-free recourse loan equal to the actual aggregate
federal, state and local income tax liability (including alternative minimum tax
obligations) incurred as a consequence of the Option exercise, which loan shall
(A) be secured by a pledge of the shares acquired upon exercise of such Options,
(B) be payable in full, with respect to each Option (or portion) so exercised,
upon the earliest of (I) the tenth anniversary of the date of grant of such
Option, (II) five days after the date on which the Executive sells, transfers or
otherwise disposes or conveys for consideration the shares acquired upon
exercise of such Option, and (III) the date specified in the Management
Stockholders' Agreement for the expiration of certain provisions thereof, (ii)
permit the Executive to extend the post-termination exercise period of such
Options (but not beyond the tenth anniversary of the date of Option grant) until
such time as the Company is able to repurchase the underlying shares of Common
Stock, or (iii) devise such other method that is reasonably acceptable to the
Executive so as to prevent the Executive from incurring tax liability upon
Option exercise at a time when he is not able to receive payment from the
Company (or a third party) for the shares acquired upon such exercise.
8. COMPETITION.
(a) The Executive shall not engage in any Prohibited Competition (as
defined below in Section 8(b)) at any time during the Term or the Non-Executive
Term, if any, and for a period of two years after the later to end of the Term
and the Non-Executive Term.
(b) For purposes of this Agreement, the Executive shall be considered
to engage in prohibited competition ("Prohibited Competition") if the Executive
shall: directly or indirectly, engage in or own, manage, join, operate or
control, or participate in the ownership, management, operation or control of,
or be connected as a director, officer, employee, partner, consultant or
otherwise with, or permit his name to be used by or in connection with, any
business or organization which produces, designs, conducts research on,
provides, sells, leases, distributes or markets accessories, chemicals, forming
and related products used in concrete and masonry construction (the "Business")
which, directly or indirectly, competes with the Business conducted by Company
and its subsidiaries in North America, South America and Europe, it being
understood that the foregoing shall not limit the Executive from making passive
investments of less than 5% of the outstanding equity securities in any entity
listed for trading on a national stock exchange or quoted on any recognized
automatic quotation system.
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(c) In the event any of the terms of this Section 8 shall be determined
by any court of competent jurisdiction to be unenforceable by reason of
extending for too great a period of time or over too great a geographical area
or by reason of being too extensive in any other respect, it will be interpreted
to extend only over the maximum period of time for which it may be enforceable,
and/or over the maximum geographical area as to which it may be enforceable
and/or to the maximum extent in all other respects as to which it may be
enforceable, all as determined by such court in such action.
9. NONDISCLOSURE OF PROPRIETARY INFORMATION.
(a) Except as required in the faithful performance of the Executive's
duties hereunder or pursuant to subsection (c), the Executive shall, in
perpetuity, maintain in confidence and shall not directly, indirectly or
otherwise, use, disseminate, disclose or publish, or use for his benefit or the
benefit of any person, firm, corporation or other entity any confidential or
proprietary information or trade secrets, and any other information that would
be protected under the Uniform Trade Secrets Act in Ohio, of or relating to the
Company, including, without limitation, information with respect to the
Company's operations, processes, products, inventions, business practices,
business strategy, business development, finances, principals, vendors,
distributors, suppliers, customers, potential customers, manufacturing methods,
sales methods, marketing methods, costs, prices, contractual relationships,
information systems, regulatory status, compensation paid to employees or other
terms of employment, or deliver to any person, firm, corporation or other entity
any document, record, notebook, computer program or similar repository of or
containing any such confidential or proprietary information or trade secrets.
The parties hereby stipulate and agree that as between them the foregoing
matters are important, material and confidential proprietary information and
trade secrets and affect the successful conduct of the businesses of the Company
(and any successor or assignee of the Company). The parties hereto agree that
"confidential or proprietary information" shall not include information that (i)
is a matter of public knowledge (other than by act of the Executive in violation
hereof); (ii) was provided to the Executive (without breach of any obligation of
confidence owed to the Company) by a third party which is not an affiliate of
the Company or (iii) is required to be disclosed by law or judicial or
administrative process.
(b) Upon termination of the Executive's employment with Company for any
reason and upon the Company's request, the Executive will promptly deliver to
the Company all correspondence, drawings, manuals, letters, notes, notebooks,
reports, programs, plans, proposals, financial documents, or any other documents
concerning, without limitation, the Company's operations, processes, products,
inventions, business practices, business strategy, business development,
finances, principals, vendors, distributors, suppliers, customers, potential
customers, manufacturing methods, sales methods, marketing methods, costs,
prices, contractual relationships, information systems, regulatory status,
compensation paid to employees or other terms of employment and/or which contain
proprietary information or trade secrets.
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(c) The Executive may respond to a lawful and valid subpoena or other
legal process but shall give the Company the earliest possible notice thereof,
shall, as much in advance of the return date as possible, make available to the
Company and its counsel the documents and other information sought and shall
assist such counsel in resisting or otherwise responding to such process.
10. INJUNCTIVE RELIEF.
It is recognized and acknowledged by the Executive that a breach of the
covenants contained in Sections 8 and 9 will cause irreparable damage to the
Company and its goodwill, the exact amount of which will be difficult or
impossible to ascertain, and that the remedies at law for any such breach will
be inadequate. Accordingly, the Executive agrees that in the event of a breach
of any of the covenants contained in Sections 8 and 9, in addition to any other
remedy which may be available at law or in equity, the Company shall be entitled
to specific performance and injunctive relief.
11. SURVIVAL.
The expiration or termination of the Term shall not impair the rights
or obligations of any party hereto which shall have accrued hereunder prior to
such expiration.
12. BINDING ON SUCCESSORS.
This Agreement shall be binding upon and inure to the benefit of the
Company, the Executive and their respective successors, assigns, personnel and
legal representatives, executors, administrators, heirs, distributees, devisees,
and legatees, as applicable.
13. GOVERNING LAW.
This Agreement shall be governed, construed, interpreted and enforced
in accordance with the substantive laws of the State of Ohio.
14. VALIDITY.
The invalidity or unenforceability of any provision or provisions of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.
15. NOTICES.
Any notice, request, claim, demand, document or other communication
hereunder to any party shall be effective upon receipt (or refusal of receipt)
and shall be in writing and delivered personally or sent by telex, telecopy, or
certified or registered mail, postage prepaid, as follows:
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(a) If to the Company, to:
Dayton Superior Corporation
0000 Xxxxxxxxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxx, XX 00000
Attention: Corporate Secretary
Phone: (000) 000-0000
Fax: (000) 000-0000
with copies to:
Odyssey Investment Partners Fund, LP
000 Xxxx Xxxxxx
Xxxx Tower, 38th Floor
New York, New York 10017
Attention: Xxxxxxx Xxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
and
Xxxxxx & Xxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Phone: (000) 000-0000
Fax: (000) 000-0000
(b) If to the Executive, to him at the address set forth below under his
signature, with a copy to:
Squire, Xxxxxxx & Xxxxxxx L.L.P.
0000 Xxx Xxxxx
000 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000-0000
Attention: Xxxx Xxx Xxxxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
or at any other address as any party shall have specified by notice in writing
to the other party in accordance with this Section 15.
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16. COUNTERPARTS.
This Agreement may be executed in several counterparts, each of which
shall be deemed to be an original, but all of which together shall constitute
one and the same Agreement.
17. ENTIRE AGREEMENT.
The terms of this Agreement, together with the Management Stockholders'
Agreement, the Option Plan and the Option Agreements, are intended by the
parties to be the final expression of their agreement with respect to the
employment of the Executive by the Company and may not be contradicted by
evidence of any prior or contemporaneous agreement. The parties further intend
that this Agreement, and the aforementioned contemporaneous documents, shall
constitute the complete and exclusive statement of its terms and that no
extrinsic evidence whatsoever may be introduced in any judicial, administrative,
or other legal proceeding to vary the terms of this Agreement. Notwithstanding
any of the foregoing to the contrary, in the event of a conflict between the
terms of this Agreement and the Management Stockholders' Agreement, the terms of
this Agreement shall govern.
18. AMENDMENTS; WAIVERS.
This Agreement may not be modified, amended, or terminated except by an
instrument in writing, signed by the Executive and the Chairman of the
Compensation Committee. By an instrument in writing similarly executed, the
Executive or the Company may waive compliance by the other party or parties with
any provision of this Agreement that such other party was or is obligated to
comply with or perform; PROVIDED, HOWEVER, that such waiver shall not operate as
a waiver of, or estoppel with respect to, any other or subsequent failure. No
failure to exercise and no delay in exercising any right, remedy or power
hereunder shall preclude any other or further exercise of any other right,
remedy or power provided herein or by law or in equity.
19. NO INCONSISTENT ACTIONS.
The parties hereto shall not voluntarily undertake or fail to undertake
any action or course of action inconsistent with the provisions or essential
intent of this Agreement. Furthermore, it is the intent of the parties hereto to
act in a fair and reasonable manner with respect to the interpretation and
application of the provisions of this Agreement.
20. ARBITRATION.
Any dispute or controversy arising under or in connection with this
Agreement shall be settled exclusively by arbitration, conducted before a panel
of three arbitrators in Cleveland, Ohio, 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
Company shall be entitled to seek a restraining order or injunction in any court
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of competent jurisdiction to prevent any continuation of any violation of the
provisions of Section 8 or 9 of this Agreement and the Executive hereby consents
that such restraining order or injunction may be granted without the necessity
of the Company's posting any bond; and PROVIDED FURTHER, that the Executive
shall be entitled to seek specific performance of his 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. Each of the parties hereto shall
bear its share of the fees and expenses of any arbitration hereunder.
21. INDEMNIFICATION AND INSURANCE; LEGAL EXPENSES.
During the Term and so long as the Executive has not breached any of
his obligations set forth in Sections 8 and 9, the Company shall indemnify the
Executive to the fullest extent permitted by the laws of the State of Delaware,
as in effect at the time of the subject act or omission, and shall advance to
the Executive reasonable attorneys' fees and expenses as such fees and expenses
are incurred (subject to an undertaking from the Executive to repay such
advances if it shall be finally determined by a judicial decision which is not
subject to further appeal that the Executive was not entitled to the
reimbursement of such fees and expenses) and he shall be entitled to the
protection of any insurance policies the Company shall elect to maintain
generally for the benefit of its directors and officers ("Directors and Officers
Insurance") against all costs, charges and expenses incurred or sustained by him
in connection with any action, suit or proceeding to which he may be made a
party by reason of his being or having been a director, officer or employee of
the Company or any of its subsidiaries or his serving or having served any other
enterprise as a director, officer or employee at the request of the Company
(other than any dispute, claim or controversy arising under or relating to this
Agreement). The Company covenants to maintain during the Term for the benefit of
the Executive (in his capacity as an officer and director of the Company)
Directors and Officers Insurance providing customary benefits to the Executive.
[signature page follows]
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IN WITNESS WHEREOF, the parties have executed this Agreement on the
date and year first above written.
DAYTON SUPERIOR CORPORATION
By: /s/ Xxxx X. XxXxxxx
-------------------
Name: Xxxx X. XxXxxxx
Title: Chief Financial Officer
EXECUTIVE
/s/ Xxxx X Xxxxxxxxxx
---------------------
Xxxx X. Xxxxxxxxxx
President and Chief Executive Officer
0000 Xxxxxx Xxxxx Xxxxx
Xxxxx, Xxxx 00000
Upon the Effective Date, accepted and agreed to for purposes of Section
3(b)
ODYSSEY INVESTMENT PARTNERS FUND, LP
By: ODYSSEY CAPITAL PARTNERS, LLC,
its general partner
By:
-------------------------------
Name:
Title:
Date:
-------------------------------
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