Exhibit 10.32
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT, dated as of December 15, 1997, is by and
between Xxxxxxx X. Xxxxxxxx (the "Employee") and CVC, Inc., a Delaware
corporation (the "Company").
The Company and the Employee hereby agree as follows:
1. Employment. The Company hereby employs the Employee, and the
Employee hereby accepts employment by the Company, upon the terms and
conditions hereinafter set forth.
2. Term. Subject to the provisions for earlier termination as
herein provided, the employment of the Employee hereunder will be for the
period commencing on the date hereof and ending on the third anniversary of
such date. Effective on the first anniversary of the date hereof and on each
successive anniversary date thereafter, the term shall automatically be
extended by an additional one year unless, no later than 90 days prior to any
such anniversary date, either the Company or the Employee gives written
notice to the other that the term will not be extended, in which case the
Employee's employment hereunder shall terminate upon the expiration of the
then-current-term. The period of the Employee's employment under this
Agreement, as it may be terminated or extended from time to time as provided
herein, is referred to hereafter as the "Employment Period."
3. Duties and Responsibilities. The Employee will be employed by
the Company in the position set forth on Annex A, a copy of which is attached
hereto and the terms of which are incorporated herein by reference. The
Employee will faithfully perform the duties and responsibilities of such
office, as they may be assigned from time to time by the Board of Directors
of the Company (the "Board") or the Board's designee, as specified on Annex A.
4. Time to be Devoted to Employment. Except for vacation in
accordance with the Company's policy in effect from time to time and absences
due to temporary illness, the Employee shall devote full time, attention and
energy during the Employment Period to the business of the Company. During
the Employment Period, the Employee will not be engaged in any other business
activity which, in the reasonable judgment of the Board or its designee,
conflicts with the duties of the Employee hereunder, whether or not such
activity is pursued for gain, profit or other pecuniary advantage.
5. Compensation; Reimbursement.
(a) Base Salary. The Company will pay to the Employee an annual base
salary of not less than the amount specified as the Initial Base Salary on
Annex A, payable in accordance with the Company's normal payroll policy. The
Employee's base salary shall be reviewed annually by the Compensation
Committee of the Board (the "Committee") and shall be subject to increase at
the option and sole discretion of the Committee.
(b) Bonus. The Employee shall be eligible to receive, at the sole
discretion of the Committee, an annual cash bonus based on pre-determined
performance standards of the Company, such as under the Company's Performance
Incentive Program as in effect on the date hereof.
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(c) Benefits; Stock Options. In addition to the salary and cash
bonus referred to above, the Employee shall be entitled during the Employment
Period to participate in such employee benefit plans or programs of the
Company, and shall be entitled to such other fringe benefits, as are from
time to time made available by the Company generally to employees of the
Employee's position, tenure, salary, and other qualifications. Without
limiting the generality of the foregoing, the Employee shall be eligible for
such awards, if any, under the Company's stock option plan as shall be
granted to the Employee by the Committee or other appropriate designee of the
Board acting in its sole discretion. Except to the extent provided in the
next paragraph, the Employee acknowledges and agrees that the Company does
not guarantee the adoption or continuance of any particular employee benefit
plan or program or other fringe benefit during the Employment Period, and
participation by the Employee in any such plan or program shall be subject to
the rules and regulations applicable thereto.
(d) Expenses. The Company will reimburse the Employee, in accordance
with the practices in effect from time to time for other officers or staff
personnel of the Company, for all reasonable and necessary traveling expenses
and other disbursements incurred by the Employee for or on behalf of the
Company in the performance of the Employee's duties hereunder, upon
presentation by the Employee to the Company of appropriate vouchers or
documentation.
6. Death; Disability. If the Employee dies or is incapacitated or
disabled by accident, sickness or otherwise, so as to render the Employee
mentally or physically incapable of performing the services required to be
performed by the Employee under this Agreement for a period that would
entitle the Employee to qualify for long-term
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disability benefits under the Company's then-current long-term disability
insurance program or, in the absence of such a program, for a period of 90
consecutive days or longer (such condition being herein referred to as a
"Disability"), then (i) in the case of the Employee's death, the Employee's
employment shall be deemed to terminate on the date of the Employee's death
or (ii) in the case of a Disability, the Company, at its option, may
terminate the employment of the Employee under this Agreement immediately
upon giving the Employee notice to that effect. Disability shall be
determined by the Board or the Board's designee. In the case of a
Disability, until the Company shall have terminated the Employee's employment
hereunder in accordance with the foregoing, the Employee shall be entitled to
receive compensation provided for herein notwithstanding any such physical or
mental disability.
7. Termination For Cause. The Company may, with the approval of a
majority of the Board, terminate the employment of the Employee hereunder at
any time during the Employment Period for "cause" (such termination being
hereinafter called a "Termination for Cause") by giving the Employee notice
of such termination, upon the giving of which such termination will take
effect immediately. For purposes of this Agreement, "cause" means (i) the
Employee's willful and substantial misconduct, (ii) the Employee's repeated,
after written notice from the Company, neglect of duties or failure to act
which can reasonably be expected to affect materially and adversely the
business or affairs of the Company or any subsidiary or affiliate thereof,
(iii) the Employee's material breach of any of the agreements contained in
Sections 12 or 13 hereof, (iv) the commission by the Employee of any material
fraudulent act with respect to the business and affairs of
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the Company or any subsidiary or affiliate thereof or (v) the Employee's
conviction of (or plea of nolo contendere to) a crime constituting a felony.
8. Termination Without Cause. The Company may terminate the
employment of the Employee hereunder at any time without "cause" (such
termination being hereinafter called a "Termination Without Cause") by giving
the Employee notice of such termination, upon the giving of which such
termination will take effect on the date specified on such notice which shall
not be later than 30 days from the date such notice is given.
9. Voluntary Termination. Any termination of the employment of the
Employee hereunder, otherwise than as a result of death or Disability, a
Termination For Cause, a Termination Without Cause or a termination for Good
Reason (as defined below) following a Change in Control (as defined below),
will be deemed to be a "Voluntary Termination." A Voluntary Termination will
be deemed to be effective immediately upon such termination or, at the
Company's option, up to 30 days following a notice of voluntary termination
given by the Employee.
10. Effect of Termination of Employment.
(a) Rights upon Termination. Upon the termination of the Employee's
employment hereunder, neither the Employee nor the Employee's beneficiaries
or estate will have any further rights or claims against the Company under
this Agreement except the right to receive (i) the unpaid portion of the base
salary provided for in Section 5(a) hereof, computed on a pro rata basis to
the date of termination, (ii) payment of his previously accrued but unpaid
rights that are then payable in accordance with the terms of any incentive
compensation, stock option, retirement, employee welfare or other employee
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benefit plans or programs of the Company in which the Executive is then
participating in accordance with Sections 5(b) and 5(c) hereof and (iii)
reimbursement for any expenses for which the Employee shall not have
theretofore been reimbursed as provided in Section 5(d) hereof.
(b) Forfeiture of Rights. In the event that, subsequent to
termination of employment hereunder, the Employee (i) breaches any of the
provisions of Section 12 or 13 hereof or (ii) directly or indirectly makes or
facilitates the making of any adverse public statements or disclosures with
respect to the business or securities of the Company, all payments and
benefits to which the Employee may otherwise have been entitled pursuant to
Section 10(a) hereof shall immediately terminate and be forfeited, and any
portion of such amounts as may have been paid to the Employee shall forthwith
be returned to the Company.
11. Change in Control Provisions.
(a) Effect of Change in Control. In the event of a Change in Control
during the Employment Period, all options held by the Employee to purchase
shares of the Company's stock that are not then vested and exercisable in
accordance with the terms of such options or the terms of any Company stock
option plan shall become immediately and fully vested and exercisable as of
the effective date of the Change in Control; provided, however, that no such
vesting shall occur if provision has been made in writing in connection with
such transaction for (a) the continuation of such plan and/or the assumption
of such options by a successor corporation (or a parent or subsidiary
thereof) or (b) the substitution for such options of new options covering the
stock of a successor corporation (or a parent or subsidiary thereof), with
appropriate adjustments as to the number and kinds
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of shares and exercise prices. In the event of any such continuation,
assumption or substitution, such plan and/or such options shall continue in
the manner and under the terms so provided.
(b) Effect of Termination Following Change in Control. In the event
of a Change in Control and a subsequent termination of the Employee's
employment during the Employment Period, either by the Company as a
Termination Without Cause or by the Employee for Good Reason (as defined
below), (i) the Employee shall be entitled to receive the same payments and
other rights as provided for in Sections 10(a) hereof, (ii) the Employee
shall be entitled to receive a severance payment in the form a cash lump sum,
paid within 15 days of the date of termination, with the amount of such
payment to be the aggregate amount of the Employee's base salary as in effect
immediately prior to such termination payable over the period of months
specified in Annex A, but discounted to present value from the dates such
payments would otherwise be made to the Employee, based on the 100%
short-term Applicable Federal Rate (compounded annually) under Section
1274(d) of the Internal Revenue Code as in effect at the time of payment,
(iii) if such termination occurred within 12 months following the effective
date of a Change in Control, any options held by the Employee as of such
effective date to purchase shares of the Company's stock that were not vested
and exercisable as of such date of termination shall become immediately and
fully vested and exercisable as of such date of termination and (iv) the
Employee shall retain the right to exercise any options to purchase shares of
the Company's stock until the earlier of (a) 12 months following the date of
such termination or (b) the expiration of the original full term of each such
option.
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(c) Definition of Change in Control. For purposes of this Agreement,
a "Change in Control" shall be deemed to have occurred upon:
(i) an acquisition subsequent to the date hereof by any person,
entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act")) (a
"Person"), of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 30% or more of either (A) the then
outstanding shares of common stock of the Company ("Common Stock") or (B)
the combined voting power of the then outstanding voting securities of
the Company entitled to vote generally in the election of directors (the
"Outstanding Company Voting Securities"); excluding, however, the
following: (1) any acquisition directly from the Company, other than an
acquisition by virtue of the exercise of a conversion privilege unless
the security being so converted was itself acquired directly from the
Company, (2) any acquisition by the Company and (3) any acquisition by an
employee benefit plan (or related trust) sponsored or maintained by the
Company;
(ii) a change in the composition of the Board such that during
any period of two consecutive years, individuals who at the beginning of
such period constitute the Board, and any new director (other than a
director designated by a person who has entered into an agreement with
the Company to effect a transaction described in clause (i), (iii) or
(iv) of this paragraph) whose election by the Board or nomination for
election by the Company's stockholders was approved by a vote of at least
two-thirds of the directors then still in office who either were
directors at the beginning of the period or whose election or nomination
for election was previously so
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approved, cease for any reason to constitute at least a majority of the
members thereof;
(iii) the approval by the stockholders of the Company of a merger,
consolidation, reorganization or similar corporate transaction, whether
or not the Company is the surviving corporation in such transaction, in
which outstanding shares of Common Stock are converted into (A) shares of
stock of another company, other than a conversion into shares of voting
common stock of the successor corporation (or a holding company thereof)
representing 80% of the voting power of all capital stock thereof
outstanding immediately after the merger or consolidation or (B) other
securities (of either the Company or another company) or cash or other
property;
(iv) the approval by the stockholders of the Company of (A) the
sale or other disposition of all or substantially all of the assets of
the Company or (B) a complete liquidation or dissolution of the Company;
or
(v) the adoption by the Board of a resolution to the effect that any
person has acquired effective control of the business and affairs of the
Company.
(d) Good Reason Following Change in Control. For purposes of
this Agreement, termination for "Good Reason" shall mean termination by the
Employee of his employment with the Company, within six months immediately
following a Change in Control, based on:
(i) any diminution in the Employee's position, title,
responsibilities or authority from those in effect immediately prior to
such Change in Control; or
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(ii) the breach by the Company of any of its material obligations
under this Agreement.
12. Nondisclosure of Information. The Employee will not, at any time
during or after the Employment Period, disclose to any person, firm,
corporation or other business entity, except as required by law, any
non-public information concerning the business, products, clients or affairs
of the Company or any subsidiary or affiliate thereof for any reason or
purpose whatsoever, nor will the Employee make use of any of such non-public
information for personal purposes or for the benefit of any person, firm,
corporation or other business entity except the Company or any subsidiary or
affiliate thereof.
13. Company Right to Inventions. The Employee will promptly
disclose, grant and assign to the Company, for its sole use and benefit, any
and all inventions, improvements, technical information and suggestions
relating in any way to the business of the Company which the Employee may
develop or acquire during the Employment Period (whether or not during usual
working hours), together with all patent applications, letters patent,
copyrights and reissues thereof that may at any time be granted for or upon
any such invention, improvement or technical information. In connection
therewith:
(i) the Employee shall, without charge, but at the expense of
the Company, promptly at all times hereafter execute and deliver such
applications, assignments, descriptions and other instruments as may be
necessary or proper in the opinion of the Company to vest title to any
such inventions, improvements, technical information, patent
applications, patents, copyrights or reissues thereof in
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the Company and to enable it to obtain and maintain the entire right and
title thereto throughout the world; and
(ii) the Employee shall render to the Company, at its expense
(including a reasonable payment for the time involved in case the
Employee is not then in its employ), all such assistance as it may
require in the prosecution of applications for said patents, copyrights
or reissues thereof, in the prosecution or defense of interferences which
may be declared involving any said applications, patents or copyrights
and in any litigation in which the Company may be involved relating to
any such patents, inventions, improvements or technical information.
14. Enforcement. It is the desire and intent of the parties hereto
that the provisions of this Agreement be enforceable to the fullest extent
permissible under the laws and public policies applied in each jurisdiction
in which enforcement is sought. Accordingly, to the extent that a restriction
contained in this Agreement is more restrictive than permitted by the laws of
any jurisdiction where this Agreement may be subject to review and
interpretation, the terms of such restriction, for the purpose only of the
operation of such restriction in such jurisdiction, will be the maximum
restriction allowed by the laws of such jurisdiction and such restriction
will be deemed to have been revised accordingly herein.
15. Remedies; Survival. (a) The Employee acknowledges and
understands that the provisions of the covenants contained in Sections 12 and
13 hereof, the violation of which cannot be accurately compensated for in
damages by an action at law, are of crucial importance to the Company, and
that the breach or threatened breach of the provisions of this Agreement
would cause the Company irreparable harm. In the event of a
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breach or threatened breach by the Employee of the provisions of Section 12
or 13 hereof, the Company will be entitled to an injunction (without the
posting of any bond) restraining the Employee from such breach. Nothing
herein contained will be construed as prohibiting the Company from pursuing
any other remedies available for any breach or threatened breach of this
Agreement.
(b) Notwithstanding anything contained in this Agreement to the
contrary, the provisions of Sections 12, 13, 14 and 15 hereof will survive
the expiration or other termination of this Agreement until, by their terms,
such provisions are no longer operative.
16. Notices. Notices and other communications hereunder will be in
writing and will be delivered personally or sent by air courier or first
class certified or registered mail, return receipt requested and postage
prepaid, addressed as follows:
if to the Employee: as specified in Annex A
and if to the Company: CVC, Inc.
000 Xxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Secretary
with a copy to: Xxxxxxxxx X. Xxxxxx, Esq.
Xxxxx Xxxxxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement will be deemed to have been given on
the date of delivery, if personally delivered; on the business day after the
date when sent, if sent by air courier; and
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on the third business day after the date when sent, if sent by mail, in each
case addressed to such party as provided in this Section 16 or in accordance
with the latest unrevoked direction from such party.
17. Binding Agreement; Benefit. The provisions of this Agreement
will be binding upon, and will inure to the benefit of, the respective heirs,
legal representatives and successors of the parties hereto.
18. Governing Law. This Agreement will be governed by, and construed
and enforced in accordance with, the laws of the State of New York, without
reference to conflict of law principles.
19. Waiver of Breach. The waiver by either party of a breach of any
provision of this Agreement by the other party must be in writing and will
not operate or be construed as a waiver of any subsequent breach by such
other party.
20. Entire Agreement; Amendments. This Agreement (including Annex A)
contains the entire agreement between the parties with respect to the subject
matter hereof and supersedes all prior agreements or understandings among the
parties with respect thereof. This Agreement may be amended only by an
agreement in writing signed by the parties hereto.
21. Headings. The section headings contained in this Agreement are
for reference purposes only and will not affect in any way the meaning or
interpretation of this Agreement.
22. Severability. Any provision of this Agreement that is prohibited
or unenforceable in any jurisdiction will, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof,
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and any such prohibition or unenforceability in any jurisdiction will not
invalidate or render unenforceable such provision in any other jurisdiction.
23. Assignment. This Agreement is personal in its nature and the
parties hereto shall not, without the consent of the other, assign or
transfer this Agreement or any rights or obligations hereunder; provided,
that the provisions hereof (including, without limitation, Sections 12 and
13) will inure to the benefit of, and be binding upon, each successor of the
Company, whether by merger, consolidation, transfer of all or substantially
all of its assets or otherwise.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
date first above written.
EMPLOYEE CVC, INC.
_________________________ _____________________________
Xxxxxxxxx X. Xxxxxxx
Chairman, President and
Chief Executive Officer
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ANNEX A
to
Employment Agreement
Name of Employee: Xxxxxxx X. Xxxxxxxx
1. Position: Vice President, Operations
2. Board of Directors' Initial
Designee to whom Employee
Shall Report: Chief Executive Officer
3. Initial Base Salary: $127,688
4. Number of months used to
calculate lump sum severance
payment in the event of a
Change in Control: 12 months
5. Employee's address for notices: 00 Xxxxxxx Xxxx
Xxxxxxxxx, XX 00000
A-1
