Exhibit 10.14
SEVERANCE AGREEMENT
SEVERANCE AGREEMENT, dated as of August 8, 1997, by and between
Xxxxxx, Xxxxxxx & Co., Inc., a debtor and a debtor in possession, having its
principal offices at 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the
"Company") and Xxxxxx Xxxxxxxx, whose address is 0000 Xxxxxxxxx Xxxxx, Xxxxxxx,
XX 00000 ("Employee").
W I T N E S S E T H:
IT IS AGREED between the parties as follows:
1. In consideration of Employee's valuable contribution to the Company
and Employee's continued employment with the Company, the Company hereby agrees
to provide Employee with a special severance benefit as set forth herein. In the
event that Employee's employment is terminated by the Company (or a purchaser of
all or substantially all of the assets of the Company), during the period of the
Company's Chapter 11 proceedings or within one (1) year from the date of
confirmation of a plan of reorganization for Xxxxxx, Xxxxxxx & Co., Inc. (the
"Term"), without Just Cause (as herein defined), the Company will pay Employee,
as a severance benefit, an amount (the "Severance Amount") equal to the greater
of (a) $171,875 or (b) Employee's then current base salary (excluding any bonus
compensation) for a period of 12 months (the "Severance Amount"). As used in
this Agreement, "Just Cause" is defined as (i) commission of wilful or
intentional misconduct that could reasonably be expected to materially injure
the reputation, business or business relationships of the Company, or result in
personal enrichment at the expense of the Company, (ii) failure to report for
work unless prevented from doing so because of illness, vacation, or other
authorized leave granted by the Company, (iii) theft, embezzlement or engaging
in any other criminal activity, (iv) provision of services to a competitor of
the Company, (v) disclosure of any trade secret or confidential information of
the Company, or (vi) excessive use of alcohol or use of illegal drugs.
2.(a) The Severance Amount shall be payable over a period of 12 months
(the "Payment Period") in accordance with the normal payroll cycle of the
Company.
2.(b) In the event that there has been a "Change in Control" and the
Employee becomes eligible for the Severance Amount pursuant to Paragraph 1
herein, then the Severance Amount shall not be payable in accordance with
paragraph 2(a) above, but shall be payable in one payment within thirty (30)
days following the termination of employment. For the purposes of this Agreement
"Change in Control" is defined as (i) a sale of in excess of 50% of the stock of
the Company or its direct or indirect domestic corporate parent (each, herein a
"Parent") to an unrelated third party, or (ii) a sale of all or substantially
all of the assets of the Company or a Parent to an unrelated third party, or
(iii) an issuance of new stock of the Company or a Parent totaling in excess of
50% of the issued and outstanding stock of the Company or Parent, as applicable,
immediately following such issuance, other than in connection with a
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plan of reorganization in which such new stock of the Company or Parent, as
applicable, is issued to existing creditors of the Company or Parent, as
applicable.
2.(c) The payment provided for in this Agreement shall constitute the
exclusive payment due Employee by reason of the termination of employment,
including any payment which may otherwise be payable pursuant to any other
separation or severance policy established or maintained by the Company, but
shall have no effect on any other benefits which may be due Employee under any
plan of the Company which provides benefits (other than separation or severance
pay) after termination of employment.
2.(d) Receipt of the Severance Amount provided for in this Agreement
shall be conditioned upon Employee's executing and delivering to the Company the
Company's standard general release form. The Company shall deduct from the
Severance Amount all amounts required by law to be withheld.
3. In consideration of the payment provided for in this Agreement,
Employee agrees that following the termination of employment Employee will not
disclose, or use for the benefit of any third party, any information relating to
the confidential affairs of the Company and its affiliates, including but not
limited to business and marketing plans, customer lists, strategies, customer
information, other information concerning the Company's and its affiliates'
products, promotions, development, financing, expansion plans, business policies
and practices, and other forms of information considered by the Company and its
affiliates to be confidential and in the nature of trade secrets. This
confidentiality covenant has no temporal, geographical or territorial
restriction.
4. In the event the Employee breaches his or her obligations hereunder,
in addition to any other rights or remedies available at law or in equity, the
Company's obligations hereunder shall cease. Further, the Employee acknowledges
and agrees that the Company's remedy at law for breach or threatened breach of
any of the provisions of paragraph 3 of this Agreement would be inadequate, and
in recognition of that fact, in the event of a breach or threatened breach by
the Employee of any obligation under paragraph 3 of this Agreement, it is
agreed, in addition to its remedies at law, the Company shall be entitled to
equitable relief in the form of specific performance, temporary restraining
order, temporary or permanent injunction or any other equitable remedy which may
then be available. Nothing herein contained shall be construed as prohibiting
the Company from pursuing any other remedies available to it for such breach or
threatened breach. The Company shall not be required to post any bond in
connection with any such relief.
5. Nothing herein contained shall confer upon Employee a right to
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continue as an employee of the Company or affect any rights of the Company to
terminate the employment of Employee for any reason whatsoever, subject,
however, to the payment of the amounts provided for in this Agreement.
6. In the event that Employee receives the Severance Amount pursuant to
paragraph 2(a) hereof, the payment of the Severance Amount shall automatically
terminate upon Employee becoming a full-time employee or full-time consultant
(including self-employment) of any corporation, person or other business entity
(an "Entity") during the Payment Period. Employee shall immediately inform the
Company upon Employee's becoming a full-time employee or full-time consultant of
any Entity during the Payment Period. In such event, any payments of the
Severance Amount shall cease, effective as of Employee's first day of employment
or consultancy with the Entity.
7. This Agreement is personal in nature and may not be assigned or
transferred by Employee, but shall be binding upon the assigns or successors of
the Company, including a purchaser of all or substantially all of the assets of
the Company. In the event the Company breaches its obligations under this
Agreement, Employee shall be entitled to be reimbursed for Employee's costs,
including reasonable attorneys' fees, in enforcing Employee's rights under this
Agreement.
8. This Agreement shall be governed by the laws of the State of New
York applicable to contracts made and to be performed in the State of New York.
9. This Agreement contains the entire understanding and agreement
between the parties hereto with respect to the subject matter hereof, and
supersedes all prior written understandings and agreements relating to the
payment of severance benefits to the Employee and may not be modified,
discharged or terminated, nor may any of the provisions hereof be waived, except
in writing signed by the parties hereto.
10. On July 17, 1995, the Company filed a voluntary petition for
reorganization under Chapter 11 of the Bankruptcy Code in the United States
Bankruptcy Court for the Southern District of New York (the "Bankruptcy Court").
The parties agree and acknowledge that this Agreement is expressly subject to
approval by order of the Bankruptcy Court, without which this Agreement is null
and void and without force or effect.
XXXXXX, XXXXXXX & CO., INC.
/s/ Xxxxxx Xxxxxxxx By: /s/ Xxxxx Xxxxxx
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Xxxxxx Xxxxxxxx
Title: Chairman
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