January 16, 1997
Xxxxxxx X. Xxxxxx, Esq.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, X.X. 10021
Dear Xxxx:
This letter, when signed by both of us, will confirm our understanding as
follows regarding certain matters relating to your employment.
Your employment as a Senior Vice President of the Company is "at will", and may
be terminated by the Company or by you at any time, for any reason, subject
however to the provisions of this agreement.
If your employment is terminated by the Company other than for cause as defined
below, you shall be entitled to severance as follows:
Continuation of base salary then in effect for 15 months ("the Severance
Period") from the date of termination. If during the Severance Period you obtain
regular employment, you agree to promptly notify the Company, and the payments
due hereunder shall be reduced dollar for dollar by the amount of cash
compensation in excess of $90,000 from such employment during the Severance
Period. If as a result of any such offset, the Company has overpaid you, you
agree to promptly reimburse the Company.
Coverage during the Severance Period (at the levels in effect for comparable
employees from time to time,) under the following employee benefit plans or
provisions for comparable benefits outside such plans, but only to the extent
comparable coverage is not provided by any new employer: (1) Group Health
Insurance Program; (2) Group Life and Accidental Death and Dismemberment
Insurance, taking into account any waiver of coverage under the Supplemental
Executive Retirement Plan ("SERP") in which you participate.
Outplacement services, in accordance with the policy of the Company for senior
executives at the time of termination.
If within 18 months following a "change of control" as defined in the SERP, you
are terminated by the Company other than for cause as defined below, or elect to
terminate your contract for "good reason" as defined in the SERP, in either case
you shall, in addition to the amounts specified above, be entitled to your
"target incentive amount" under the Executive Annual Incentive Plan ("EAIP") for
a fiscal year ending during the Severance Period, (and if not otherwise
determined prior to termination, for any prior fiscal year) and the same amount
(pro- rated to the end of the Severance Period), for the EAIP for a fiscal year
beginning during the Severance Period, or the equivalent under any comparable
bonus or variable compensation plan which may hereafter be adopted by the
Company in lieu of the EAIP.
Xxxxxxx X. Xxxxxx, Esq. January 16, 1997
You agree that the payments and benefits set forth above shall be full and
adequate compensation for all damages you may suffer as result of termination of
your employment.
If, without cause or your consent, or other than on account of disability as
defined in the Company's programs, your cash compensation is reduced from the
current levels (other than as a result of targets not being met in any EAIP or
equivalent program) and within 30 days thereafter you elect to terminate your
employment by written notice, or if you elect to terminate your employment for
"good reason" within 18 months following a "change of control", in either case
such termination shall be treated as a termination by the Company without cause
for purposes of this agreement.
Notwithstanding the foregoing, any rights or benefits you may have under the
employment and benefit plans and programs of the Company (other than for
severance, which shall be determined hereunder), including without limitation
the SERP shall be determined in accordance with such plans and programs, and
nothing in this agreement shall modify or reduce any rights you may have
resulting from a "change of control" as defined in the SERP.
For purposes of this agreement, "cause" shall be limited to:
a substantial failure or refusal to devote your full business time, and your
knowledge and skills, to the best of your ability, to the performance of your
duties, after notice by the Company, or serious willful misconduct relating to
your duties and obligations as an employee.
Conviction of a crime, perpetuation of a fraud, habitual intoxication or illegal
use of controlled or habit forming substances, or knowingly making a material
false statement to the Company's board or management.
In consideration of our entering into this agreement, you agree that for period
of five months after termination of your employment for any reason other than
termination by the Company without cause, or termination by you for "good
reason" following a "change of control" as defined in the SERP, you will not
directly or indirectly be employed by, render services to, or participate in the
management, operation or control (as a consultant or otherwise), of a business
Xxxxxxx X. Xxxxxx, Esq. January 16,1997
of the same nature as that carried on by the Company or any of its subsidiaries.
You further agree that for one year after termination of your employment for any
reason (including termination by the company without cause) except for a
termination by the company, or by you for "good reason within 18 months
following a change of control", you will not directly or indirectly solicit for
employment or hire any employee of the company, without our prior written
consent.
Except as otherwise provided above, this is our entire agreement concerning your
employment, and no modification shall be binding unless it is in writing and
signed by the party against whom enforcement is sought. This agreement shall be
interpreted and construed in accordance with the laws of the State of New York,
without giving effect to its conflict of laws provisions, and shall be binding
upon the Corporation and its successors and assigns.
Please sign and return the enclosed copy of this letter to confirm our
agreement.
Sincerely,
XXXX XXXXX & SONS, INC.
By: ______________________
Xxxxxxx X. Xxxxx
President & Chief Executive
Officer
Agreed:
_______________________
