Exhibit 10.17
SEVERANCE BENEFIT AGREEMENT
THIS AGREEMENT is made and entered into as of the 21st day of
November, 1991, by and between X. XXXXXX NUTRITIONAL PRODUCTS, INC. OF
DELAWARE, a Delaware corporation (the "Company"), and XXXXX X. XXXXXXX
("Executive").
R E C I T A L S
A. Executive is the Senior Vice President-Operations Planning of
the Company; and
B. The Company desires to assure the retention of the services of
Executive, whose experience, knowledge and abilities with respect to the
business and affairs of the Company are valuable to the Company and would be
difficult to replace;
NOW THEREFORE, in consideration of the mutual covenants and
agreements hereinafter set forth, the parties hereto hereby agree as follows:
1. Severance Benefit. In consideration of Executive's past
service to the Company, his current value to the Company, and his continued
service to the Company, the Company agrees that if Executive's employment is
terminated by the Company other than for Cause (as defined below), or if
Executive resigns his employment with the Company for Good Reason (as defined
below), the Company shall provide to Executive upon such termination or
resignation, subject to the limitations set forth below, the total of the
following severance benefits:
(a) A lump-sum severance payment equal to three times the sum of
(i) one year's base salary, plus (ii) any annual individual performance
bonus or targeted commission, both as in effect at the time of the
termination or resignation;
(b) Outplacement assistance at the Company's expense, up to a maximum
cost to the Company of $20,000; and
(c) Such rights under applicable Company plans or programs, including
but not limited to stock option and incentive plans, as Executive may have
pursuant to the terms of such plans or programs;
provided, however, that if the Company determines that the foregoing
benefits, either alone or together with other payments and benefits that
Executive has a right to receive from the Company, would not be deductible
(in whole or in part) by the Company or any parent entity thereof
because such payments constitute a "parachute payment" (as defined in Section
280G of the Internal Revenue Code, as amended (the "Code")), the amount of
the foregoing benefits shall be reduced to the largest amount that the
Company can pay or provide without incurring a restriction on the
deductibility of such payments under Section 280G of the Code. Subject to
the foregoing, Executive shall be entitled to designate the order in which
various benefits shall be reduced in order to satisfy the reduction
contemplated by the preceding sentence.
2. Discharge for Cause. For purposes of this Agreement, "Cause"
shall mean one of the following, as determined by the affirmative vote of a
majority of the Board of Directors acting at a meeting at which a quorum is
present:
(a) Executive's willful malfeasance, gross negligence or dishonesty
in the performance of Executive's duties to the Company, but excluding such
duties as would constitute a basis for Executive to resign for "Good
Reason" hereunder;
(b) Executive's willful breach of any employment agreement between
Executive and the Company;
(c) Executive's substantial and continuing refusal to perform
Executive's duties to the Company, but excluding such duties as would
constitute a basis for Executive to resign for "Good Reason" hereunder; or
(d) The conviction of Executive on charges of (i) a felony under the
laws of the United States or any state involving moral turpitude or (ii) a
crime under the laws of any other country or political subdivision thereof
that would constitute a felony involving moral turpitude under the laws of
the United States or any state had they applied.
3. Resignation for Good Reason. For purposes of this Agreement,
resignation for "Good Reason" shall mean the termination of Executive's
employment for any of the following reasons (without Executive's express
prior written consent):
(a) The assignment to Executive by the Company of duties materially
inconsistent with Executive's positions, duties, responsibilities, titles
or offices as of the date hereof or as such appropriately may change from
time to time during the term of this Agreement;
(b) Any material reduction by the Company of Executive's duties or
responsibilities;
(c) Any loss by Executive of the position held on the date hereof or
appropriately assigned to Executive hereafter (except in connection with
the termination of Executive's employment for Cause) as a result of
Executive's death or "permanent disability" (defined for purposes of this
Agreement as the inability of Executive to render services to the Company
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on a full-time basis due to physical or mental illness or disability for
six months or more in the aggregate in any 12-month period);
(d) A reduction by the Company in Executive's base salary or
individual performance bonus, as in effect on the date hereof or as the
same may be increased from time to time during the term of this Agreement;
(e) A material adverse change in Executive's benefits or perquisites,
as in effect on the date hereof or as the same may be increased or improved
from time to time during the term of this Agreement;
(f) The requirement by the Company that Executive relocate to an
office or location more than thirty (30) miles from Executive's
then-current principal office location; or
(g) The failure by the Company to obtain the specific assumption of
this Agreement by any successor or assign of the Company or any person
acquiring substantially all of the Company's assets.
4. Employment at Will. The Company may terminate Executive's
employment at any time for any reason, and Executive may terminate his
employment with the Company at any time for any reason, and nothing in this
Agreement shall be construed as giving either the Company or Executive any
right or obligation to continue their employment relationship.
5. Discharge For Cause or Resignation without Good Reason. If
Executive is discharged for Cause, or if Executive voluntarily resigns
without Good Reason, all payments of base salary and performance bonus, as
well as all of Executive's benefits, shall immediately cease and Executive
shall be entitled to no further compensation or benefits of any kind.
6. Waiver or Modification. Any waiver, alteration or modification
of any of the provisions of this Agreement or cancellation or replacement of
this Agreement shall not be valid unless made in writing and signed by the
parties hereto. Waiver by either party of a breach of any provision of this
Agreement shall not operate or be construed as a waiver of any subsequent
breach.
7. Construction. Except as to matters of internal corporate
policy and regulation, which shall be governed by the laws of the State of
Delaware (the State of incorporation of the Company), this Agreement shall be
governed by the laws of the State of California.
8. Binding Effect. The rights and obligations of the Company
under this Agreement shall be binding upon and shall inure to the benefit of
any successors or assigns of the Company. In the event of any consolidation
or merger of the Company into or with another corporation,
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such other corporation shall assume this Agreement and shall become obligated
to perform all of the terms and conditions hereof, and Executive's
obligations hereunder shall continue in favor of such other corporation or
the subsidiary of such corporation carrying on the major part of the business
of the Company.
9. Entire Agreement. This Agreement constitutes the entire
understanding of the parties with respect to the subject matter hereof and
supersedes all prior agreements, amendments, memoranda or understandings
between the Company and Executive.
10. Counterparts. This Agreement may be executed in a number of
identical counterparts, each of which shall be construed as an original for
all purposes, but all of which taken together shall constitute one and the
same Agreement.
11. Notices. Any notice required or permitted to be given under
this Agreement shall be in writing and delivered in person or sent by
registered or certified United States mail, postage and fees prepaid, to the
addresses of the parties set forth below, or such other address as shall be
furnished by notice hereunder by any such party:
The Company: 0000 Xxxx 000xx Xxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Chief Executive Officer
Executive: 0000 Xxx Xxxxxxx
Xxxxx Xxxxxx Xxxxxxx, Xxxxxxxxxx 00000
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first above written.
"THE COMPANY": X. XXXXXX NUTRITIONAL PRODUCTS, INC. OF
DELAWARE
By: /s/
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Xxxxxxx Xxxxxx
Chief Executive Officer
"EXECUTIVE": /s/
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Xxxxx X. Xxxxxxx
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