EXHIBIT 10.1
EMPLOYMENT AGREEMENT
THIS AGREEMENT, dated as of July 21, 2004, is between IDEX CORPORATION, a
Delaware corporation with its executive offices at 000 Xxxxxx Xxxx, Xxxxx 000,
Xxxxxxxxxx, Xxxxxxxx 00000 (the "Corporation"), and XXXXXXXX X. XXXXXXXX, an
individual residing at 0000 Xxxxx Xxx, Xxxx Xxxxx, Xxxxxxxx 00000 (the
"Executive").
RECITALS:
A. The Executive will be employed as the Chief Operating Officer of
the Corporation.
B. The Corporation and the Executive desire to set forth the terms
upon which the Executive will be employed by the Corporation.
NOW, THEREFORE, in consideration of the promises and of the
covenants contained in this Agreement, the Corporation and the Executive agree
as follows:
1. DEFINITIONS. The following definitions apply for purposes of this
Agreement.
(a) "Board of Directors" or "Board" means the Board of Directors of
the Corporation.
(b) "Cause" means that any of the following conditions exist:
(i) The Executive's failure to perform his material duties
under this Agreement (other than as a result of his Disability) if
such failure, if curable, is not cured within 30 days after written
notice is provided to the Executive.
(ii) The Executive's breach of his fiduciary duty to the
Corporation.
(iii) The Executive's indictment under the laws of the United
States, or any state thereof, for a (i) civil offense which is
injurious to the business reputation of the Corporation or (ii)
criminal offense.
(iv) Breach by the Executive of any material provision of this
Agreement or of any policy of the Corporation if such breach, if
curable, is not cured within 15 days after written notice is
provided to the Executive.
(c) A "Change in Control " means the occurrence of (i) any
transaction or series of transactions which within a 12-month period constitute
a change of management or control where (A) at least 51 percent of the then
outstanding shares of common stock are (for cash, property (including, without
limitation, stock in any corporation), or indebtedness, or any combination
thereof) redeemed by the Corporation or purchased by any person(s), firm(s) or
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entity(ies), or exchanged for shares in any other corporation whether or not
affiliated with the Corporation, or any combination of such redemption, purchase
or exchange, or (B) at least 51 percent of the Corporation's assets are
purchased by any person(s), firm(s) or entity(ies) whether or not affiliated
with the Corporation for cash, property (including, without limitation, stock in
any corporation) or indebtedness or any combination thereof, or (C) the
Corporation is merged or consolidated with another corporation regardless of
whether the Corporation is the survivor (except any such transaction solely for
the purpose of changing the Corporation's domicile or which does not change the
ultimate beneficial ownership of the equity interests in the Corporation), or
(ii) any substantial equivalent of any such redemption, purchase, exchange,
change, transaction or series of transactions, acquisition, merger or
consolidation constituting such a change of management or control. For purposes
hereof, the term "control" shall have the meaning ascribed thereto under the
Securities Exchange Act of 1934, as amended and the regulations thereunder, and
the term "management" shall mean the chief executive officer of the Corporation.
For purposes of clause (i)(B) above or as appropriate for purposes of clause
(ii) above, the Corporation shall be deemed to include on a consolidated basis
all subsidiaries and other affiliated corporations or other entities with the
same effect as if they were divisions.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Corporation" means IDEX Corporation.
(f) "Disability" means a disability that has existed for a period of
6 consecutive months and because of which the Executive is physically or
mentally unable to substantially perform his regular duties as Chief Operating
Officer of the Corporation.
(g) "Employment Date" means August 23, 2004.
(h) "Good Reason" means:
(i) There has been a material diminution in the Executive's
responsibilities, duties, title, reporting responsibilities within
the business organization, status, role or authority which is not
restored within 15 days after written notice is provided to the
Corporation.
(ii) Removal of the Executive from the position of Chief
Operating Officer, other than elevation to a higher ranking
executive officer position with the Corporation.
(iii) A required relocation of more than 75 miles from the
location of Executive's principal job location or office immediately
prior to the Change In Control.
(iv) A material breach by the Corporation of any of the
material terms of this Agreement if such breach is not substantially
cured within 15 days after written notice is provided to the
Corporation.
2. EMPLOYMENT; DUTIES. Subject to the terms and conditions set forth
in this Agreement, the Corporation hereby agrees to employ the Executive, and
the Executive hereby accepts employment, and, as of the Employment Date, will
assume the role as the Chief Operating Officer of the Corporation and will
perform and execute the duties and responsibilities assigned to the Executive
from time to time by the Board of Directors and the Chief Executive
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Officer. The Executive will perform those duties and discharge those
responsibilities as are commensurate with his position. The Executive agrees to
perform his duties and discharge his responsibilities in a faithful manner and
to the best of his ability and to use all reasonable efforts to promote the
interests of the Corporation. The Executive may not accept other gainful
employment except with the prior consent of the Board of Directors of the
Corporation. With the prior consent of the Board of Directors of the
Corporation, the Executive may become a director, trustee or other fiduciary of
other corporations, trusts or entities. Notwithstanding the foregoing, the
Executive may manage his passive investments and be involved in charitable,
civic and religious interests so long as they do not materially interfere with
the performance of the Executive's duties hereunder.
3. COMPENSATION.
(a) During the term of the Executive's employment under this
Agreement, the Executive will receive a base salary at the rate of $450,000 per
year, payable, in equal bi-weekly installments. On an annual basis, the Board of
Directors will, in good faith, review the base salary of the Executive to
consider appropriate increases (but not decreases) in the base salary. If the
Executive dies during the period of time of his service under this Agreement,
service for any part of the bi-weekly payroll period of his death will be
considered service for the entire payroll period.
(b) During the term of the Executive's employment under this
Agreement, the Executive will be entitled to receive an annual cash bonus from
the Corporation calculated pursuant to the Corporation's Executive Incentive
Bonus Plan (the "EIBP") in effect from time to time. The EIBP provides for a
maximum bonus amount equal to 2% of operating income of the Corporation -- based
upon attainment of objective performance goals established by the Compensation
Committee under the EIBP in the first ninety days of the fiscal year. The
Compensation Committee of the Board of Directors, however, may, in its
discretion, reduce the amount of bonus payable under the EIBP based on
Executive's attainment of certain objective and/or subjective factors as the
Compensation Committee may determine. It is the intention of the parties that
the factors that by the Compensation Committee may consider in determining
whether to reduce the amount of bonus payable under the EIBP will include
factors similar to those used by the Board of Directors in administering the
Management Incentive Compensation Plan for Key Employees and that, subject to
the terms of the EIBP and Executive's satisfactory attainment of the objective
and/or subjective performance factors established by the Compensation Committee,
the actual amount payable under the EIBP should be in the range of 0% to 195% of
Executive's base salary for the fiscal year, but not in excess of amount
provided under the EIBP. Additionally, for calendar year 2004, the Executive
will be paid a bonus amount (the "Contract Bonus") equal to (i) $337,500, minus
(ii) the amount, if any, payable under the EIBP for calendar year 2004.
Notwithstanding the foregoing sentence, the Contract Bonus will not be less than
$0.00. The Contract Bonus will be paid at the time payment is customarily made
under the EIBP.
(c) On the Employment Date, the Corporation will award the Executive
145,000 options on the Corporation's common stock (the "Inducement Options").
The price of the Inducement Options will be the closing share price of the
Corporation's common stock, as reported by the New York Stock Exchange, as of
the immediately previous business day. A copy of the Option Agreement pursuant
to which the options will be awarded to the Executive is
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attached hereto as Exhibit A. Commencing in 2005, the Executive will be annually
considered for long-term equity incentive awards.
(d) On the Employment Date, the Corporation and the Executive shall
enter into a Restricted Stock Award (in the form attached hereto as Exhibit B)
with respect to 115,000 shares of the Corporation's common stock (the
"Inducement Restricted Stock Award").
(e) The Corporation will pay to the Executive an amount up to, but
not in excess of, $60,000 the Executive's initiation fee for membership in a
country club.
(f) The Corporation will deduct or withhold from all salary and
bonus payments, and from all other payments made to the Executive pursuant to
this Agreement, all amounts that may be required to be deducted or withheld
under any applicable Social Security contribution, income tax withholding or
other similar law now in effect or that may become effective during the term of
this Agreement.
4. OTHER BENEFITS AND TERMS. During the term of the Executive's
employment under this Agreement, the Executive will be entitled to the following
other benefits and terms:
(a) The Executive will be entitled to participate in, the
Corporation's ChoiceComp health and medical benefit plans, any pension, profit
sharing and retirement plans, and any insurance policies or programs from time
to time generally offered to all or substantially all executive employees who
are employed by the Corporation. These plans, policies and programs are subject
to change at the sole discretion of the Corporation.
(b) The Executive will be entitled to any other fringe benefit from
time to time generally offered to all or substantially all senior executive
employees who are employed by the Corporation.
(c) The Corporation will provide the Executive with the use of an
automobile or an auto use allowance that is commensurate with his position. The
Executive will be entitled to limited use of the Corporation's aircraft for
non-business purposes subject to the terms of the Corporation's Aircraft Use
Guidelines.
(d) Except as specifically provided in Sections 9(a)(i) and 9(e)(i),
or as required by law, the Executive acknowledges that he, his spouse and
dependents will not receive health and medical benefits following any
termination of his employment.
(e) The Executive represents and warrants to the Corporation that
the Executive's acceptance of the employment and performance of the duties
contemplated under this Agreement will not, to his knowledge, be in violation of
any non-competition or confidentiality agreements to which the Executive is a
party or is bound (the "Restrictive Agreements").
5. VACATIONS. The Executive will be entitled to four weeks of paid
vacation each year. Unused vacation in any year may not be carried over to
subsequent years.
6. REIMBURSEMENT FOR EXPENSES. The Corporation will reimburse the
Executive for expenses which the Executive may from time to time reasonably
incur on behalf of the Corporation in the performance of his responsibilities
and duties including, but not limited to, professional dues and attendance at
professional conferences.
7. PERIOD OF EMPLOYMENT. Subject to the provisions of this Section,
the period of employment of the Executive under this Agreement will begin on the
Employment Date and
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continue until August 31, 2009. Upon the expiration of the initial period, the
period of employment will be automatically extended for 12 consecutive month
periods thereafter, unless either party provides 120 days prior written notice
to the other party that it does not wish to extend the Executive's employment
period beyond its then present term.
Notwithstanding the foregoing:
(a) The Executive's employment will automatically terminate upon the
death or Disability of the Executive. The foregoing is subject to the duty of
the Corporation to provide reasonable accommodation under the Americans with
Disabilities Act.
(b) The Corporation may, at its sole option, terminate the
Executive's employment at any time and for any reason by delivering written
notice to the Executive.
(c) The Executive, at his sole option, may terminate his employment
by providing written notice to the Corporation at least 90 days prior to the
effective date of the termination of employment specified in the notice.
Any notice of termination of employment given by a party must
specify the particular termination provision of this Agreement relied upon by
the party and must set forth in reasonable detail the facts and circumstances
that provide a basis for the termination.
8. INDEMNIFICATION. The Corporation will enter into an indemnity
agreement with the Executive substantially in the form contained in Exhibit C of
this Agreement. The Corporation will reimburse Executive the expense incurred to
defend any claims that Executive is in violation of the Restrictive Agreements
by reason of Executive's employment with the Corporation.
9. BENEFITS UPON TERMINATION. The Corporation will provide the
following benefits upon the termination of the Executive's employment with the
Corporation.
(a) Upon Termination By The Corporation Other Than For Cause. Upon
the Corporation's termination of the Executive's employment for other than
Cause, the Corporation will provide the following:
(i) Salary And Fringe Benefits. The Executive will receive his
full salary and fringe benefits through the effective date of
termination together with any unpaid bonus for a prior period. The
Executive will also receive (i) his full salary, and (ii) medical
and health insurance (medical and health insurance is hereinafter
referred to as "Fringe Benefits") as in effect on the date of either
the Corporation's or the Executive's receipt of a notice of
termination from the other party for a period of 18 months beginning
with the month next following the month during which his employment
terminates. If the Executive dies during the 18 month period, the
balance of the salary payments will be paid as provided in Section
15 and any dependent health or medical Fringe Benefits will be
provided for the balance of the 18 month period.
(ii) Bonus. The Executive will receive a bonus amount equal to
the 112.5% of his base salary in effect in the year of the
termination of his
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employment. This amount will be paid in 18 equal monthly payments
beginning with the month next following the month during which his
employment terminates. Additionally, the Executive will receive a
bonus amount equal to the amount determined by multiplying the bonus
amount determined under the EIBP by a fraction the numerator of
which is the number of full and partial calendar months of service
in the calendar year that includes the date of the termination of
his employment and the denominator of which is 12. This amount will
be paid at the time payment is customarily made under the EIBP.
(iii) Accrued Vacation. The Executive will receive payment for
accrued but unused vacation, which payment will be equitably
prorated based on the period of active employment for that portion
of the fiscal year in which the Executive's termination of
employment becomes effective. Payment for accrued but unused
vacation will be payable in one lump sum on the effective date of
the termination of employment (or as soon thereafter as
practicable).
(iv) Equity Compensation. The Inducement Options will become
fully vested and will be exercisable according to the terms of the
option agreement and the Inducement Restricted Stock Award will
become fully vested.
(b) Upon Termination By The Executive Or By The Corporation For
Cause. Upon the Executive's termination of employment or by the Corporation for
Cause, the Corporation will provide the following:
(i) Salary And Fringe Benefits. The Executive will receive his
full salary and Fringe Benefits through the effective date of
termination together with any unpaid bonus for a prior period.
(ii) Accrued Vacation. The Executive will receive payment for
accrued but unused vacation, which payment will be equitably
prorated based on the period of active employment for that portion
of the fiscal year in which the Executive's termination of
employment becomes effective. Payment for accrued but unused
vacation will be payable in one lump sum on the effective date of
the termination of employment (or as soon thereafter as
practicable).
(c) Upon Termination For Disability. Upon termination of the
Executive's employment because of Disability, the Corporation will provide the
following:
(i) Salary And Fringe Benefits. The Executive will receive his
full salary and Fringe Benefits through the effective date of
termination together with any unpaid bonus for a prior period.
(ii) Bonus. The Executive will receive a bonus amount equal to
the amount determined by multiplying the bonus amount determined
under the EIBP by a fraction the numerator of which is the number of
full and partial calendar months of service in the calendar year
that includes the date of the termination of
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his employment and the denominator of which is 12. This amount will
be paid at the time payment is customarily made under the EIBP.
(iii) Accrued Vacation. The Executive will receive payment for
accrued but unused vacation, which payment will be equitably
prorated based on the period of active employment for that portion
of the fiscal year in which the Executive's Disability commences.
Payment for accrued but unused vacation will be payable in one lump
sum on the date the Disability commences (or as soon thereafter as
practicable).
(iv) Equity Compensation. The Inducement Options will become
fully vested and will be exercisable according to the terms of the
option agreement and the Inducement Restricted Stock Award will
become fully vested.
(d) Upon Termination For Death. Upon termination of the Executive's
employment because of his death, the Corporation will provide the following:
(i) Salary And Fringe Benefits. The (i) Executive's full
salary and Fringe Benefits through the effective date of termination
and (ii) any unpaid bonus for a prior period.
(ii) Bonus. The Executive will receive a bonus amount equal to
the amount determined by multiplying the bonus amount determined
under the EIBP by a fraction the numerator of which is the number of
full and partial calendar months of service in the calendar year
that includes the date of the termination of his employment and the
denominator of which is 12. This amount will be paid at the time
payment is customarily made under the EIBP.
(iii) Accrued Vacation. The Executive's successor as provided
in Section 15 will receive payment for accrued but unused vacation,
which payment will be equitably prorated based on the period of
active employment for that portion of the fiscal year in which the
Executive died. Payment for accrued but unused vacation will be
payable in one lump sum on the date of the Executive's death (or as
soon thereafter as practicable).
(iv) Equity Compensation. The Inducement Options will become
fully vested and will be exercisable according to the terms of the
option agreement and the Inducement Restricted Stock Award will
become fully vested.
(e) Upon Termination Following A Change In Control. Upon the
Executive's termination of employment by the Corporation without Cause or the
Executive's termination with Good Reason which, in either case, occurs in
contemplation of or within the 24 month period following a Change in Control,
the Corporation will provide the following:
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(i) Salary And Fringe Benefits. The Executive will receive his
full salary and Fringe Benefits through the effective date of
termination together with any unpaid bonus for a prior period. The
Executive will also receive his full salary and Fringe Benefits, as
in effect on the effective date of termination, for a period of 24
months beginning with the month next following the month during
which his employment terminates. If the Executive dies during the 24
month period, the balance of the salary payments will be paid as
provided in Section 15 and any dependent health or medical Fringe
Benefits will be provided for the balance of the 24 month period.
(ii) Bonus. The Executive will receive a bonus amount equal to
the 150% of his base salary in effect in the year of the termination
of his employment. This amount will be paid in 24 equal monthly
payments beginning with the month next following the month during
which his employment terminates. Additionally, the Executive will
receive a bonus amount equal to the amount determined by multiplying
the bonus amount determined under the EIBP by a fraction the
numerator of which is the number of full and partial calendar months
of service in the calendar year that includes the date of the
termination of his employment and the denominator of which is 12.
This amount will be paid at the time payment is customarily made
under the EIBP.
(iii) Accrued Vacation. The Executive will receive payment for
accrued but unused vacation, which payment will be equitably
prorated based on the period of active employment for that portion
of the fiscal year in which the Executive's termination of
employment becomes effective. Payment for accrued but unused
vacation will be payable in one lump sum on the effective date of
the termination of employment (or as soon thereafter as
practicable).
(iv) Equity Compensation. The Inducement Options will vest and
will be exercisable in the manner provided under the terms of the
option plan under which they were granted. The Inducement Restricted
Stock Award will become fully vested.
(f) Upon Expiration of Term. Upon the expiration of the term of this
Agreement pursuant to the first paragraph of Section 7, the Corporation will
provide the following:
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(i) Salary And Fringe Benefits. The Executive will receive his
full salary and Fringe Benefits through the effective date of
termination together with any unpaid bonus for a prior period.
(ii) Accrued Vacation. The Executive will receive payment for
accrued but unused vacation, which payment will be equitably
prorated based on the period of active employment for that portion
of the fiscal year in which the Executive's termination of
employment becomes effective. Payment for accrued but unused
vacation will be payable in one lump sum on the effective date of
the termination of employment (or as soon thereafter as
practicable).
(g) Reduction In Fringe Benefits. Medical and health Fringe Benefits
under this Section will be reduced to the extent of any medical and health
fringe benefits provided by and available to the Executive from any subsequent
employer.
(h) Determination Of Disability. Any question as to the existence of
a physical or mental condition which would give rise to the Disability of the
Executive upon which the Executive and the Corporation cannot agree will be
determined by a qualified independent physician selected by the Executive and
reasonably acceptable to the Corporation (or, if the Executive is unable to make
a selection, the selection of the physician will be made by any adult member of
his immediate family). The physician's written determination to the Corporation
and to the Executive will be final and conclusive for all purposes of this
Agreement.
10. ADDITIONAL PAYMENTS. Notwithstanding anything in this Agreement
or any other agreement to the contrary, in the event it is determined that any
payments or distributions by the Corporation or any affiliate (as defined under
the Securities Act of 1933, as amended, and the regulations thereunder) thereof
or any other person to or for the benefit of the Executive, whether paid or
payable pursuant to the terms of this Agreement, or pursuant to any other
agreement or arrangement with the Corporation or any such affiliate
("Payments"), would be subject to the excise tax imposed by Section 4999 of the
Code, or any successor provision, or any interest or penalties with respect to
the excise tax (the excise tax, together with any interest and penalties, are
hereinafter collectively referred to as the "Excise Tax"), then the Executive
will be entitled to receive an additional payment from the Corporation (a
"Gross-Up Payment") in an amount that after payment by the Executive of all
taxes (including, without limitation, any interest or penalties imposed with
respect to such taxes and any 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. The amount of the Gross-Up Payment will be calculated
by the Corporation's independent accounting firm, engaged immediately prior to
the event that triggered the payment, in consultation with the Corporation's
outside legal counsel. For purposes of making the calculations required by this
Section, the accounting firm may make reasonable assumptions and approximations
concerning applicable taxes and may rely on reasonable, good faith
interpretations concerning the application of Sections 280G and 4999 of the
Code, provided that the accounting firm's determinations must be made with
substantial authority (within the meaning of Section 6662 of the Code). The
Gross-Up Payment will be paid on the Executive's last day of employment or on
the occurrence of the event that results in the
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imposition of the Excise Tax, if later. If the precise amount of the Gross-Up
Payment cannot be determined on the date it is to be paid, an amount equal to
the best estimate of the Gross-Up Payment will be made on that date and, within
10 days after the precise calculation is obtained, either the Corporation will
pay any additional amount to the Executive or the Executive will pay any excess
amount to the Corporation, as the case may be. If subsequently the Internal
Revenue Service (the "IRS") claims that any additional Excise Tax is owing, an
additional Gross-Up Payment will be paid to the Executive within 30 days of the
Executive providing substantiation of the claim made by the IRS. After payment
to the Executive of the Gross-Up Payment, the Executive will provide to the
Corporation any information reasonably requested by the Corporation relating to
the Excise Tax, the Executive will take those actions as the Corporation
reasonably requests to contest the Excise Tax, cooperate in good faith with the
Corporation to effectively contest the Excise Tax and permit the Corporation to
participate in any proceedings contesting the Excise Tax. The Corporation will
bear and pay directly all costs and expenses (including any interest or
penalties on the Excise Tax), and indemnify and hold the Executive harmless, on
an after-tax basis, from all such costs and expenses related to such contest.
Should it ultimately be determined that any amount of an Excise Tax is not
properly owed, the Executive will refund to the Corporation the related amount
of the Gross-Up Payment.
11. NON-EXCLUSIVITY OF RIGHTS. Except as otherwise specifically
provided, nothing in this Agreement will prevent or limit the Executive's
continued or future participation in any benefit, incentive, or other plan,
practice, or program provided by the Corporation and for which the Executive may
qualify. Any amount of vested benefit or any amount to which the Executive is
otherwise entitled under any plan, practice, or program of the Corporation will
be payable in accordance with the plan, practice, or program, except as
specifically modified by this Agreement.
12. NO OBLIGATION TO SEEK OTHER EMPLOYMENT. The Executive will not
be obligated to seek other employment or to take other action to mitigate any
amount payable to him under this Agreement and, except as provided in Section
9(g), amounts owed to him hereunder shall not be reduced by amounts he may
receive from another employer.
13. CONFIDENTIALITY. During the course of his employment, the
Executive will have access to confidential information relating to the lines of
business of the Corporation, its trade secrets, marketing techniques, technical
and cost data, information concerning customers and suppliers, information
relating to product lines, and other valuable and confidential information
relating to the business operations of the Corporation not generally available
to the public (the "Confidential Information"). The parties hereby acknowledge
that any unauthorized disclosure or misuse of the Confidential Information could
cause irreparable damage to the Corporation. The parties also agree that
covenants by the Executive not to make unauthorized use or disclosures of the
Confidential Information are essential to the growth and stability of the
business of the Corporation. Accordingly, the Executive agrees to the
confidentiality covenants set forth in this Section.
The Executive agrees that, except as required by his duties with the
Corporation or as authorized by the Corporation in writing, he will not use or
disclose to anyone at any time, regardless of whether before or after the
Executive ceases to be employed by the Corporation,
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any of the Confidential Information obtained by him in the course of his
employment with the Corporation. The Executive shall not be deemed to have
violated this Section 13 by disclosure of Confidential Information that at the
time of disclosure (a) is publicly available or becomes publicly available
through no act or omission of the Executive, or (b) is disclosed as required by
court order or as otherwise required by law, on the condition that notice of the
requirement for such disclosure is given to the Corporation prior to make any
disclosure.
The Executive agrees that since irreparable damage could result from
his breach of the covenants in this Section, in addition to any and all other
remedies available to the Corporation, the Corporation will have the remedies of
a restraining order, injunction or other equitable relief to enforce the
provisions thereof. The Executive consents to jurisdiction in Lake County,
Illinois on the date of the commencement of any action for purposes of any
claims under this Section. In addition, the Executive agrees that the issues in
any action brought under this Section will be limited to claims under this
Section, and all other claims or counterclaims under other provisions of this
Agreement will be excluded.
In addition, the Executive will sign and be bound by the terms of
the attached "Employee Inventions and Proprietary Information Agreement"
attached hereto as Exhibit D. To the extent that the provisions of Exhibit D
conflict with this Agreement, the terms of this Agreement will be controlling.
14. NON-COMPETITION. In consideration of the compensation and other
benefits to be paid to the Executive under and in connection with this
Agreement, the Executive agrees that, beginning on the date of this Agreement
and continuing until the Covenant Expiration Date (as defined in Subsection (b)
below), he will not, directly or indirectly, for his own account or as agent,
employee, officer, director, trustee, consultant, partner, stockholder or equity
owner of any corporation or any other entity (except that he may passively own
securities constituting less than 1% of any class of securities of a public
company), or member of any firm or otherwise, (i) engage or attempt to engage,
in the Restricted Territory (as defined in Subsection (d) below), in any
business activity which is directly or indirectly competitive with the business
conducted by the Corporation or any Affiliate at the Reference Date (as defined
in Subsection (c) below), (ii) employ or solicit the employment of any person
who is employed by the Corporation or any Affiliate at the Reference Date or at
any time during the six-month period preceding the Reference Date, except that
the Executive will be free to employ or solicit the employment of any such
person whose employment with the Corporation or any Affiliate has terminated for
any reason (without any interference from the Executive) and who has not been
employed by the Corporation or any Affiliate for at least 6 months, (iii)
canvass or solicit business in competition with any business conducted by the
Corporation or any Affiliate at the Reference Date from any person or entity who
during the six-month period preceding the Reference Date was a customer of the
Corporation or any Affiliate or from any person or entity which the Executive
has reason to believe might in the future become a customer of the Corporation
or any Affiliate as a result of marketing efforts, contacts or other facts and
circumstances of which the Executive is aware, (iv) willfully dissuade or
discourage any person or entity from using, employing or conducting business
with the Corporation or any Affiliate or (v) intentionally disrupt or interfere
with, or seek to disrupt or interfere with, the business or contractual
relationship between the Corporation or any Affiliate and any supplier who
during
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the six-month period preceding the Reference Date shall have supplied
components, materials or services to the Corporation or any Affiliate.
Notwithstanding the foregoing, the restrictions imposed by this
Section shall not in any manner be construed to prohibit, directly or
indirectly, the Executive from serving as an employee or consultant of the
Corporation or any Affiliate.
For purposes of this Agreement, the following terms have the
meanings given to them below:
(a) "Affiliate" means any joint venture, partnership or subsidiary
now or hereafter directly or indirectly owned or controlled by the Corporation.
For purposes of clarification, an entity shall not be deemed to be indirectly or
directly owned or controlled by the Corporation solely by reason of the
ownership or control of such entity by shareholders of the Corporation.
(b) "Covenant Expiration Date" means the date which is two (2) years
after the Termination Date (as defined in this Section).
(c) "Reference Date" means (A) for purposes of applying the
covenants set forth in this Section at any time prior to the Termination Date,
the then current date, or (B) for purposes of applying the covenants set forth
in this Section at any time on or after the Termination Date, the Termination
Date.
(d) "Restricted Territory" means anywhere in the world where the
Corporation or any Affiliate conducts or plans to conduct its business activity
at the Reference Date.
(e) "Termination Date" means the date of termination of the
Executive's employment with the Corporation; provided however that the
Executive's employment will not be deemed to have terminated so long as the
Executive continues to be employed or engaged as an employee or consultant of
the Corporation or any Affiliate, even if such employment or engagement
continues after the expiration of the term of this Agreement, whether pursuant
to this Agreement or otherwise.
15. SUCCESSORS. This Agreement is personal to the Executive and may
not be assigned by the Executive other than by will or the laws of descent and
distribution. This Agreement will inure to the benefit of and be enforceable by
the Executive's legal representatives or successors in interest. Notwithstanding
any other provision of this Agreement, the Executive may designate a successor
or successors in interest to receive any amounts due under this Agreement after
the Executive's death. If he has not designated a successor in interest, payment
of benefits under this Agreement will be made to his wife, if surviving, and if
not surviving, to his estate. A designation of a successor in interest must be
made in writing, signed by the Executive, and delivered to the Corporation
pursuant to Section 19. Except as otherwise provided in this Agreement, if the
Executive has not designated a successor in interest, payment of benefits under
this Agreement will be made to the Executive's estate. This Section
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will not supersede any designation of beneficiary or successor in interest made
by the Executive or provided for under any other plan, practice, or program of
the Corporation.
This Agreement will inure to the benefit of and be binding upon the
Corporation and its successors and assigns.
The Corporation will require any successor (whether direct or
indirect, by acquisition of assets, merger, consolidation or otherwise) to all
or substantially all of the operations or assets of the Corporation or any
successor and without regard to the form of transaction used to acquire the
operations or assets of the Corporation, to assume and agree to perform this
Agreement in the same manner and to the same extent that the Corporation would
be required to perform it if no succession had taken place. As used in this
Agreement, "Corporation" means the Corporation and any successor to its
operations or assets as set forth in this Section that is required by this
clause to assume and agree to perform this Agreement or that otherwise assumes
and agrees to perform this Agreement.
16. FAILURE, DELAY OR WAIVER. No course of action or failure to act
by the Corporation or the Executive will constitute a waiver by the party of any
right or remedy under this Agreement, and no waiver by either party of any right
or remedy under this Agreement will be effective unless made in writing.
17. SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such a manner as to be enforceable under
applicable law. However, if any provision of this Agreement is deemed
unenforceable under applicable law by a court having jurisdiction, the provision
will be unenforceable only to the extent necessary to make it enforceable
without invalidating the remainder thereof or any of the remaining provisions of
this Agreement.
18. NOTICE. All written communications to parties required hereunder
must be in writing and (a) delivered in person, (b) mailed by registered or
certified mail, return receipt requested, (such mailed notice to be effective 4
days after the date it is mailed) or (c) sent by facsimile transmission, with
confirmation sent by way of one of the above methods, to the party at the
address given below for the party (or to any other address as the party
designates in a writing complying with this Section, delivered to the other
party):
If to the Corporation:
IDEX Corporation
Xxxxx 000
000 Xxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: Vice President - General Counsel
Telephone: 000-000-0000
Telecopier: 000-000-0000
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with a copy to:
Xxxxxxx Xxxx LLP
Xxx X&X Xxxxx
Xxxxx 0000
Xxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq. and Xxxxxxx X. Xxxxxx, Esq.
Telephone: 000-000-0000
Telecopier: 000-000-0000
If to the Executive:
Xxxxxxxx X. Xxxxxxxx
0000 Xxxxx Xxx
Xxxx Xxxxx, Xxxxxxxx 00000
Telephone: 000-000-0000
with a copy to:
___________________________________
___________________________________
___________________________________
___________________________________
Attention: ___________________________
Telephone: ___________________________
Telecopier: ___________________________
19. MISCELLANEOUS. This Agreement (a) may not be amended, modified
or terminated orally or by any course of conduct pursued by the Corporation or
the Executive, but may be amended, modified or terminated only by a written
agreement duly executed by the Corporation and the Executive, (b) is binding
upon and inures to the benefit of the Corporation and the Executive and each of
their respective heirs, representatives, successors and assignees, except that
the Executive may not assign any of his rights or obligations pursuant to this
Agreement, (c) except as provided in Sections 4 and 11 of this Agreement,
constitutes the entire agreement between the Corporation and the Executive with
respect to the subject matter of this Agreement, and supersedes all oral and
written proposals, representations, understandings and agreements previously
made or existing with respect to such subject matter, and (d) will be governed
by, and interpreted and construed in accordance with, the laws of the State of
Illinois, without regard to principles of conflicts of law.
20. TERMINATION OF THIS AGREEMENT. This Agreement will terminate
when the Corporation has made the last payment provided for hereunder; provided,
however, that the obligations set forth under Sections 8, 9, 10, 12, 13 and 14
of this Agreement will survive any termination and will remain in full force and
effect.
21. MULTIPLE COUNTERPARTS. This Agreement may be executed in one or
more counter parts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. Any party may execute
this Agreement by facsimile signature and the other party shall be entitled to
rely on such facsimile signature as evidence that this Agreement has been duly
executed by such party. Any party executing this Agreement by
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facsimile signature shall immediately forward to the other party an original
page by overnight mail.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as
of the date first above written.
CORPORATION:
IDEX CORPORATION
By_____________________________________
Name: Xxxxx X. Xxxxxx
Title: Vice President - General
Counsel and Secretary
EXECUTIVE:
_______________________________________
Xxxxxxxx X. Xxxxxxxx
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EXHIBIT A
Stock Option Award Agreement
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EXHIBIT B
Restricted Stock Award
- 17 -
EXHIBIT C
Indemnity Agreement
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EXHIBIT D
Employee Inventions and Proprietary Information Agreement
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