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EXHIBIT 10.17
STATE OF NORTH CAROLINA EXECUTIVE
SEVERANCE AGREEMENT
COUNTY OF MECKLENBURG
THIS AGREEMENT, entered into this _______ day of November, 1997, by and
between Xxxxx, Inc., a North Carolina corporation, hereinafter referred to as
the "Company," and ______________________, hereinafter referred to as
"Executive";
STATEMENT OF PURPOSE
The Board of Directors of the Company has recently authorized a program
(the "New Severance Program") designed to provide certain executives of the
Company with severance benefits upon the termination of their employment with
the Company and its Affiliates under certain circumstances following a Change in
Control of the Company.
In addition to the benefits under the New Severance Program, the
Company desires to provide Executive with certain benefits in the event of
Executive's involuntary termination of employment without cause prior to a
Change in Control.
Therefore, the Company and Executive have entered into (i) a
Compensation and Benefits Assurance Agreement pursuant to the New Severance
Program and (ii) this Agreement which provides Executive certain benefits in the
event of Executive's termination of employment under certain circumstances prior
to a Change in Control.
NOW, THEREFORE, in consideration of the Statement of Purpose and the
terms and provisions of this Agreement, the parties hereto mutually agree as
follows:
1. DEFINITIONS. Capitalized terms used in this Agreement that (i) are
not expressly defined herein and (ii) are defined in the Compensation and
Benefits Assurance Agreement shall have the respective meanings given to those
terms in the Compensation and Benefits Assurance Agreement. In addition, as used
herein, the following terms shall have the following meanings:
(a) "Cause" means:
(i) Executive's failure to devote his best
efforts and substantially full time during
normal business hours to the discharge of
the duties and responsibilities of
Executive's position reasonably assigned to
him, other than during reasonable periods of
vacation and other reasonable leaves of
absence commensurate with Executive's
position and length of service; or
(ii) A material and willful breach of Executive's
fiduciary duties to the Company and its
stockholders; or
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(iii) In connection with the discharge of
Executive's duties with the Company, one or
more material acts of fraud or dishonesty or
gross abuse of authority; or
(iv) Executive's commission of any willful act
involving moral turpitude which materially
and adversely affects (A) the name and good
will of the Company or (B) the Company's
relationship with its employees, customers
or suppliers; or
(v) Executive's habitual and intemperate use of
alcohol or drugs to the extent that the same
materially interferes with Executive's
ability to competently, diligently and
substantially perform the duties of his
employment.
(b) "Compensation and Benefits Assurance Agreement" means
that certain Compensation and Benefits Assurance
Agreement between Executive and the Company entered
into on the date hereof.
(c) "Effective Date" means the date of this Agreement.
(d) "Termination Date" means the date of Executive's
Termination of Employment.
2. TERM OF AGREEMENT.
(a) This Agreement will commence on the Effective Date
and shall continue in effect until the third
anniversary of the Effective Date (the "Initial
Term").
(b) The Initial Term of this Agreement automatically
shall be extended for one additional year at the end
of the Initial Term, and then again after each
successive one (1) year period thereafter (each such
one (1) year period following the Initial Term being
hereinafter referred to as a "Successive Period").
However, either party may terminate this Agreement
effective at the end of the Initial Term or at the
end of any Successive Period thereafter (the
"Expiration Date") by giving the other party written
notice of such termination and intent not to renew,
delivered at least one (1) year prior to the
Expiration Date. If such notice is properly delivered
by either party, this Agreement, along with all
corresponding rights, duties, and covenants shall
automatically expire on the Expiration Date.
3. COMPENSATION AND BENEFITS ASSURANCE AGREEMENT. Contemporaneously
herewith, the Company and Executive have entered into the Compensation and
Benefits Assurance Agreement. Notwithstanding anything to the contrary contained
herein, in no event shall any payments or benefits be made to or provided
Executive under the terms of
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this Agreement if Severance Benefits are payable under the Compensation and
Benefits Assurance Agreement.
4. INVOLUNTARY TERMINATION OF EMPLOYMENT PRIOR TO A CHANGE IN CONTROL.
In the event of Executive's involuntary Termination of Employment without Cause
prior to a Change in Control, the Company agrees to pay to or provide Executive
with the following:
(a) A single cash payment in an amount equal to the sum
of (i) Executive's Base Salary in effect on the
Termination Date plus (ii) the Executive's
then-current target bonus opportunity (stated in
terms of a percentage of Base Salary) established
under the Company's Annual Corporate Performance
Incentive Plan for Officers (or any successor plan
thereto), if any, in effect on the Termination Date,
which payment shall be made within thirty (30) days
after the Termination Date.
(b) A single cash payment in an amount equal to
Executive's unpaid Base Salary, accrued vacation pay,
unreimbursed business expenses, and all other items
earned by and owed to Executive through the
Termination Date.
(c) A single cash payment in an amount equal to the
greater of (i) the Executive's then-current target
bonus opportunity (stated in terms of a percentage of
Base Salary) established under the Company's Annual
Corporate Performance Incentive Plan for Officers (or
any successor plan thereto), if any, for the
incentive plan year in which the Termination Date
occurs, adjusted on a pro-rata basis based on the
number of days Executive was actually employed during
such incentive plan year or (ii) the actual bonus
earned through the Termination Date under the
Company's Annual Corporate Performance Incentive Plan
for Officers (or any successor plan thereto), if any,
based on the then-current level of goal achievement;
which payment shall be made at the same time as the
payments are made to the Company's other employees
under the Company's Annual Corporate Performance
Incentive Plan for Officers (or any successor plan
thereto), if any, for incentive plan year during
which the Termination Date occurs.
(d) Indemnification of Executive from any claims asserted
against Executive arising out of the prior
performance of Executive's duties with the Company or
its Affiliates to the same extent as the Company
indemnifies retired officers or directors of the
Company.
(e) Payment of Executive's vested interest under the
Company sponsored qualified profit sharing and 401(k)
Plans when and as provided in, and otherwise subject
to, the terms, provisions and conditions of said
Plans, and nothing in this Agreement shall modify or
override the terms, provisions and conditions of such
Plans.
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5. OTHER TERMINATION OF EMPLOYMENT. Except as otherwise expressly
provided to the contrary in the Compensation and Benefits Assurance Agreement,
Executive shall not be entitled to any payments or benefits upon his Termination
of Employment in the following events:
(a) Executive's voluntary Termination of Employment, or
(b) Executive's involuntary Termination of Employment for
Cause, or
(c) Executive's Termination of Employment, whether
voluntary or involuntary, with or without Cause,
following a Change in Control.
6. MITIGATION. In no event shall Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable
to Executive under any of the provisions of this Agreement, nor shall the amount
of any payment hereunder be reduced by any compensation earned by Executive as a
result of employment by another employer.
7. APPLICABLE LAW. This Agreement is made and executed with the
intention that the construction, interpretation and validity hereof shall be
determined in accordance with and governed by the laws of the State of North
Carolina.
8. BINDING EFFECT. This Agreement shall be binding upon and inure to
the benefit of the Company, its successors and assigns. This Agreement shall be
binding upon and inure to the benefit of Executive, his heirs, executors and
administrators.
9. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof and supersedes and
cancels all prior or contemporaneous oral or written agreements and
understandings between them with respect to the subject matter hereof.
IN WITNESS WHEREOF, the Company has caused this Agreement to be signed
by its duly authorized officers and its corporate seal to be hereunto affixed,
and Executive has hereunto set his hand and seal, all as of the day and year
first above written.
Xxxxx, Inc.
[CORPORATE SEAL]
ATTEST: By:______________________________
President
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Secretary
____________________________[SEAL]
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