Exhibit (vi)
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October 27, 2000
Xxxx X. Xxxxxxxxxx
RE: Letter of Agreement
Dear Marc:
This letter agreement is intended to set forth the commitments Pitney Xxxxx (the
"Company") intends to undertake if the Company both establishes a new legal
entity to operate the majority of the Company's existing Office Systems Division
business (the "Business") and spins off the Business in a separate transaction
to be determined in the future. For purposes of this Agreement, the spin-off
Business shall be referred to as "Spinco."
The Company shall offer you the position of Chief Executive Officer of Spinco.
During your employment with the Company, you agree to perform the duties of
Chief Executive Officer of Spinco in addition to your duties of Chief Operating
Officer of the Company without any additional compensation. Immediately prior to
the spin off of the Business in a separate transaction, you will assume the
duties of the Chief Executive Officer of Spinco on a full-time basis and your
compensation, benefits and incentive package as the full-time Chief Executive
Officer of Spinco shall be as follows:
1. Salary. Your annual salary shall be $825,000.
2. Annual Incentive. You will be eligible to participate in Spinco's
annual incentive compensation program. For the first full fiscal year
of your employment, you shall be entitled to a minimum incentive award
of $577,500, the equivalent of 70% of your salary, and a maximum award
of $1,072,500, the equivalent of 130% of your salary, depending upon
the achievement of performance targets established by Spinco's Board
of Directors.
3. Long-Term Incentive. You shall be eligible to participate in Spinco's
Long-Term Incentive Plan. You shall be eligible for a minimum award of
$625,000 and a maximum of award $1,250,000, depending upon Spinco's
achievement of performance goals established by the Board of Directors
of Spinco for multi-year cycles.
The payment shall be made at the end of each performance cycle in
accordance with the terms of the plan.
4. Equity. You may be granted stock options in Spinco at the discretion
of Spinco's Board of Directors.
5. Benefits. During the period of your employment, you shall be eligible
to participate in Spinco's benefits programs which are made available
to Spinco employees of equal status.
6. Welfare Benefits. During your employment, you and your eligible
dependents shall be eligible to participate in Spinco's group medical
and dental plans which are made available to Spinco employees of equal
status.
You understand and agree that immediately prior to the spin-off, the terms and
conditions of your employment with Spinco may be reflected in a formal written
document, which would contain the compensation terms herein and would be subject
to the approval of the Spinco Board following the spin-off. In the event the
Business is not spun-off, this agreement imposes no further independent
obligations upon the Company with respect to your employment or termination of
employment by the Company.
This agreement shall be effective as of the date you sign the agreement and
shall continue in effect until you are notified in writing by me that the
agreement ceases to be effective as of a date I shall specify in the notice.
Sincerely,
Xxxxxxx X. Xxxxxxxx
Chairman and
Chief Executive Officer
Agreed to and Accepted by:
______________________
Xxxx X. Xxxxxxxxxx
______________________
DATE
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