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EXHIBIT 10.1
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EXECUTION COPY
AGREEMENT
PAXAR CORPORATION (the "Company"), and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ("Executive") agree to
enter into this AGREEMENT dated as of July 11, 2001 as follows:
1. PURPOSE.
The Company acknowledges and recognizes the value of Executive's services, which
services are of special, unique and extraordinary character. The Company desires
to continue to employ Executive and retain his abilities and services through
December 31, 2005 and, thereafter, to continue to obtain his advice as a member
of the Company's Board of Directors (the "Board"). In recognition of his long
and faithful service to the Company, the Company also desires to provide
Executive and his spouse with the retirement benefits specified in this
Agreement.
2. 1986 EMPLOYMENT AGREEMENT SUPERSEDED.
(a) Executive and the Company originally entered into an Employment
Agreement dated as of December 16, 1986, and amended as of January 1,
1996 (as amended, the "1986 Agreement"). The parties have agreed that
the terms and conditions set forth in this Agreement shall supersede
any and all provisions of the 1986 Agreement and any other existing
oral or written agreements, representations, or warranties, between
Executive and the Company, and that such agreements shall be null and
void and of no further force and effect, except as otherwise
specifically provided in this Agreement.
(b) Notwithstanding the termination of the 1986 Agreement as of the
Effective Date, the Company shall be required to pay Executive in
accordance with the terms of 1986 Agreement (i) any accrued but unpaid
base salary under the 1986 Agreement for services rendered before the
Effective Date, (ii) the amount of any compensation earned and deferred
under the 1986 Agreement by Executive before the Effective Date, (iii)
any earned but unpaid incentive compensation for any calendar year
ended before the Effective Date, and (iv) any expenses required to be
reimbursed under the 1986 Agreement that have accrued but are unpaid as
of the Effective Date.
3. EMPLOYMENT.
The Company hereby agrees to continue to employ Executive, and Executive hereby
agrees to continue to be employed by the Company, upon the terms, and subject to
the conditions, set forth in this Agreement effective as of January 1, 2001 (the
"Effective Date").
4. PERIOD OF EMPLOYMENT; AGREED RETIREMENT DATE.
The parties agree that Executive's last day of employment with the Company will
be December 31, 2005, unless his employment is extended to such later date as
may be mutually agreed upon by the parties or terminated earlier in accordance
with Section 10 below. As used in this Agreement, (a) the phrase "Employment
Period" refers to Executive's period of employment
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from the Effective Date until his last day of employment and (b) the phrase
"Agreed Retirement Date" means December 31, 2005, or such later date as may be
mutually agreed upon by the parties.
5. MEMBERSHIP ON BOARD OF DIRECTORS.
During the period ending as of the earlier of December 31, 2010 or Executive's
attainment of the Board's mandatory retirement age, the Company shall include
Executive in the management slate for election as a director and shall recommend
his election at any stockholders' meeting at which his term otherwise would
expire.
6. POSITIONS; DUTIES AND RESPONSIBILITIES.
(a) Executive shall have the following duties and responsibilities as a
member of the Board:
(i) Executive shall continue to serve as the Chairman of the Board
until December 31, 2003 or such other date as is mutually
agreed by the parties. In his capacity as Chairman, Executive
shall have the customary duties and responsibilities of
Chairman.
(ii) During the period commencing as of termination of Executive's
service as Chairman of the Board and ending on the Agreed
Retirement Date, Executive shall serve as Chairman of the
Executive Committee of the Board or in such comparable
position as the Board may determine. In such capacity,
Executive shall have such duties and responsibilities as are
customary for such position and such other duties and
responsibilities as the Board may designate from time to time.
(iii) During the period commencing after his Agreed Retirement Date
and for as long as Executive is a member of the Board,
Executive shall have the same duties and responsibilities as
other non-employee members of the Board.
(b) Executive shall have the following positions, duties and
responsibilities as an employee of the Company
during the Employment Period:
(i) Executive shall continue to serve as the Company's Chief
Executive Officer until August 31, 2001 (or such earlier date
as is mutually agreed to by the parties). In such capacity,
Executive shall perform the customary duties and have the
customary responsibilities of such position.
(ii) On and after September 1, 2001 (or such earlier date as is
mutually agreed to by the parties), Executive shall cease to
serve as the Company's Chief Executive Officer and the Company
shall employ Executive as a senior executive officer during
the remainder of the Employment Period. In such capacity,
Executive shall report to the Board and shall have such duties
and responsibilities as the
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Board may assign from time to time consistent with Executive's
position as a senior executive officer.
(c) Executive agrees to serve the Company faithfully, to devote such
business time, attention and energies as is necessary or appropriate to
the performance of his duties, and to perform the duties under this
Agreement to the best of his abilities.
(d) Executive agrees (i) to comply with all applicable laws, rules and
regulations, and all requirements of all applicable regulatory,
self-regulatory, and administrative bodies; (ii) to comply with the
Company's rules, procedures, policies, requirements, and directions;
and (iii) not to engage in any other business or employment without the
written consent of the Company, except as otherwise specifically
provided herein.
7. COMPENSATION AND BENEFITS DURING EMPLOYMENT PERIOD.
Executive shall receive the following compensation and benefits during the
Employment Period.
(a) BASE SALARY. The Company shall pay Executive a base salary at the
annual rate in effect immediately prior to the Effective Date of this
Agreement ("Base Salary") in accordance with the compensation policy
applicable to the Company's senior executive officers. The Board may
increase Executive's Base Salary from time to time in its discretion.
The Board also may reduce Executive's Base Salary, provided that it has
also reduced the base salaries of other senior executive officers and
the reduction of Executive's Base Salary is comparable with that of the
other senior executive officers. Such Base Salary shall be paid in
accordance with the Company's standard payroll practice for senior
executive officers.
(b) ANNUAL INCENTIVE COMPENSATION. Executive shall be eligible to receive
annual incentive compensation in the form of a cash bonus, profit
sharing or otherwise as the Board or the Compensation Committee may
grant the Executive from time to time in accordance with targets and
other criteria established by the Board or the Compensation Committee
for senior executive officers of the Company. For calendar years 2001,
2002, and 2003, Executive's annual bonus award will be equal to 75% of
his Base Salary in effect for the calendar year, if the Company
achieves 100% of the plan targets. For calendar years 2004 and 2005,
Executive's annual bonus award will be equal to 50% of his Base Salary
in effect for the calendar year, if the Company achieves 100% of the
plan targets.
(c) STOCK OPTIONS. For calendar years 2001, 2002 and 2003, Executive shall
participate in the Company's stock option plans and be eligible to
receive grants under such plans in accordance with the Company's policy
applicable to senior executive officers. Unless the Board or
Compensation Committee provides otherwise, Executive shall not be
eligible to receive additional grants under the stock option plans
awarded for any periods of service beginning on and after January 1,
2004.
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(d) BENEFIT PLANS, FRINGE BENEFITS AND VACATIONS. Executive shall be
eligible to participate in or receive benefits under any pension plan,
401(k) savings plan, nonqualified deferred compensation plan,
supplemental executive retirement plan, medical and dental benefits
plan, life insurance plan, short-term and long-term disability plans,
supplemental and/or incentive compensation plans, or any other employee
benefit or fringe benefit plan, generally made available by the Company
to senior executive officers in accordance with the eligibility
requirements of such plans and subject to the terms and conditions set
forth in this Agreement.
(e) COMPANY-PROVIDED AUTOMOBILE. The Company shall continue to provide
Executive with the full-time use of an automobile and payment of
related expenses at the same style and level as provided to Executive
immediately prior to the Effective Date of this Agreement.
(f) EXPENSE REIMBURSEMENT. The Company shall promptly reimburse Executive
for the ordinary and necessary business expenses incurred by Executive
in the performance of his duties under this Agreement in accordance
with the Company's customary practices applicable to senior executive
officers.
(g) PRIVATE OFFICE, PERSONAL ADMINISTRATIVE ASSISTANT, OTHER SERVICES AND
SUPPORT. The Company shall furnish Executive with a private office of a
size and with the furnishings and other appointments, an exclusive
personal administrative assistant selected by Executive at his sole
discretion, and such other facilities, services and staff, in each case
at a level that is consistent with his position, duties and
responsibilities.
8. SUPPLEMENTAL RETIREMENT BENEFIT.
The Company shall pay Executive a supplemental retirement benefit as follows:
(a) The supplemental retirement benefit will be an amount equal to 60% of
Executive's Final Average Compensation. The following rules shall apply
for purposes of determining Executive's Final Average Compensation:
(i) If Executive's last day of employment occurs before December
31, 2004, his Final Average Compensation shall be equal to the
average of Executive's Total Compensation for the three (3)
calendar years of the last five (5) full calendar years of
Executive's employment with the Company preceding such last
day of employment in which Executive earned the highest Total
Compensation (as defined in clause (iv) below).
(ii) If Executive's last day of employment occurs on or after
December 31, 2004, but before December 31, 2005, his Final
Average Compensation shall be equal to the average of
Executive's Total Compensation for the three (3) calendar
years of the last six (6) full calendar years of Executive's
employment with the Company
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preceding such last day of employment in which Executive
earned the highest Total Compensation.
(iii) If Executive's last day of employment occurs on or after
December 31, 2005, his Final Average Compensation shall be
equal to the average of Executive's Total Compensation for the
three (3) calendar years of the last seven (7) full calendar
years of Executive's employment with the Company preceding
such last day of employment in which Executive earned the
highest Total Compensation.
(iv) "Total Compensation" means the total Base Salary and incentive
compensation earned by Executive for a calendar year,
including compensation earned in one calendar year and paid or
payable in a subsequent calendar year.
It is the intention of the parties that if Executive's last day of
employment occurs on December 31, then the year in which such last day
of employment occurs shall be included as a full calendar year for
purposes of determining Executive's Final Average Compensation.
(b) The Company shall pay the supplemental retirement benefit to Executive
in equal monthly installments commencing on the first day of the first
calendar month after the last date on which Executive is entitled to
receive payment of Base Salary under Section 7(a) or 11(d) of this
Agreement.
(c) In the event of Executive's death, the Company shall pay to his
surviving spouse until her death or such earlier date as determined in
accordance with Section 24(f) below an amount equal to 50% of the
supplemental retirement benefit determined under Section 8(a) above in
equal monthly installments. Such payments will commence as soon as
practicable following Executive's date of death.
(d) The supplemental retirement benefit will be payable to Executive and
his surviving spouse if Executive's employment is terminated before the
Agreed Retirement Date, regardless of the reason for termination of
employment.
9. COMPENSATION AND BENEFITS FOLLOWING TERMINATION OF EMPLOYMENT.
In addition to the supplemental retirement benefit described in Section 8 above,
the Company will provide Executive and his spouse with the benefits described in
this Section 9 following termination of his employment if Executive continues in
employment until the Agreed Retirement Date or if Executive's employment is
terminated before the Agreed Retirement Date for any reason other than Cause
pursuant to Section 10(c) below:
(a) HEALTH INSURANCE. The Company shall provide the following health
insurance benefits to Executive and his spouse:
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(i) If Executive is not eligible for Medicare as of the last day
of his employment, the Company shall provide for Executive's
and his spouse's continued coverage under all Company health
benefit plans, programs, or arrangements, whether group or
individual, at a level of coverage that is at least as
favorable as provided to Executive during the Employment
Period until the date on which Executive first becomes
eligible for Medicare. The Company shall pay the full cost for
such coverage. In the event that Executive's participation in
any such Company plan, program, or arrangement is prohibited,
the Company shall arrange to provide Executive with benefits
substantially similar to those which Executive would have been
entitled to receive from the Company under such plan, program,
or arrangement, for such period.
(ii) The Company shall provide the following health insurance
benefits to Executive and his spouse after Executive becomes
eligible for Medicare:
(A) The Company shall pay the full annual premium for any
Medicare supplemental insurance coverage selected by
Executive until his death.
(B) The Company shall provide Executive's surviving
spouse (as determined in accordance with Section
24(f) below) with health insurance coverage (through
the purchase of insurance or otherwise) that is
substantially similar to the coverage that she would
have received if Executive had continued in active
employment until she becomes eligible for Medicare.
The Company shall pay the full cost of such coverage.
(b) STOCK OPTIONS. Upon Executive's last day of employment, all outstanding
unexercised stock options granted to Executive under the Company's
employee stock option plans (i) shall become fully vested and
exercisable as of his last day of employment and (ii) shall continue to
be exercisable until the option expiration date (determined without
regard to Executive's employment termination date).
(c) POST EMPLOYMENT OFFICE AND OFFICE SERVICES. After Executive's last day
of employment, whenever the Executive so requests, the Company will
provide office space for him at a level commensurate with his status as
the Company's former Chief Executive Officer and Chairman of the Board.
In addition, during this period, whenever the Executive so requests,
the Company will also provide the Executive with the services of an
administrative assistant who, in the opinion of the Executive, is
capable of providing services at a level equal to the administrative
services provided to the Executive during the Employment Period. The
Company shall have the obligation to provide such office and
administrative services to Executive at the Company's headquarters or
at such other Company location, acceptable to Executive, where such
services can be provided. If, on the Executive's last day of
employment, the Company's headquarters are located more than ten (10)
miles from their present location, then if requested by Executive, the
Company shall provide such office and administrative services to
Executive at a location within such ten-mile radius acceptable to
Executive.
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(d) DIRECTOR'S FEES AND EXPENSES. During the period that Executive
continues to serve as a member of the Board, the Company shall continue
to provide Executive with the same fees, expense reimbursements and
other benefits as are provided to other non-employee members of the
Board.
10. TERMINATION OF EMPLOYMENT BEFORE THE AGREED RETIREMENT DATE.
Executive's employment under this Agreement may be terminated prior to the
Agreed Retirement Date under any of the circumstances set forth in this Section
10.
(a) DEATH. Executive's employment shall terminate upon Executive's death.
(b) TOTAL DISABILITY. The Company may terminate Executive's employment upon
his becoming "Totally Disabled." For purposes of this Agreement,
Executive shall be "Totally Disabled" if Executive is physically or
mentally incapacitated so as to render Executive incapable of
performing his usual and customary duties under this Agreement without
reasonable accommodation. Executive's receipt of disability benefits
under the Company's long-term disability benefits plan (the "LTD Plan")
or receipt of Social Security disability benefits shall be deemed
conclusive evidence of Total Disability for purpose of this Agreement;
provided, however, that in the absence of Executive's receipt of such
long-term disability benefits or Social Security benefits, the
Company's Board of Directors (the "Board") may, in its reasonable
discretion (but based upon appropriate medical evidence), determine
that Executive is Totally Disabled.
(c) TERMINATION BY THE COMPANY FOR CAUSE. The Company may terminate
Executive's employment for "Cause". Such termination shall be effective
as of the date specified in the written notice of termination provided
to Executive.
(i) For purposes of this Agreement, the term "Cause" shall mean
any of the following: (A) conviction (including conviction on
a nolo contendere plea) of (I) a crime involving the
commission by Executive of a felony or (II) a criminal act
intended to result directly or indirectly in substantial gain
or personal enrichment to Executive at the expense of the
Company, but excluding any such conviction that results solely
from Executive's title or position with the Company and is not
based on his personal conduct; or (B) willful misconduct or
gross negligence in connection with the business of the
Company or an affiliate occurring after the Effective Date of
this Agreement that results in material damage to the Company
or the affiliate or to their respective businesses, whether
monetary or otherwise; or (C) persistent failure to observe or
perform Executive's duties and responsibilities or to comply
with Company policies as set forth in Section 6 hereof after
written notice thereof by the Company; or (D) breach of any of
the covenants set forth in Section 13 or 14 of this Agreement.
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(ii) Executive's employment shall in no event be considered to have
been terminated by the Company for Cause if the act or failure
to act upon which such termination is based was done or
omitted to be done as a result of bad judgment or negligence
on Executive's part.
(iii) Any determination of Cause under this Agreement shall be made
by resolution duly adopted by the affirmative vote of all of
the non-employee members of the Board at a meeting of the
Board called and held for that purpose. Executive shall be
provided with reasonable notice of such meeting and shall be
given the opportunity to be heard before such vote is taken by
the Board.
(d) TERMINATION BY THE COMPANY WITHOUT CAUSE. The Company may terminate
Executive's employment under this Agreement without Cause after
providing ninety (90) days' prior written notice of termination to
Executive.
(e) TERMINATION BY EXECUTIVE FOR GOOD REASON. Executive may terminate his
employment under this Agreement for "Good Reason" after providing
thirty (30) days' written notice to the Company. Termination of
employment by Executive for "Good Reason" shall be deemed to have
occurred, if Executive terminates his employment following the
occurrence of any of the following:
(i) The Company's failure to comply with its obligations under
this Agreement in any material respect if such failure
continues for thirty (30) days after notice in writing from
Executive specifying such failure.
(ii) The failure by the Company to obtain an assumption of the
obligations of the Company under this Agreement as required by
Section 20(a).
(f) TERMINATION BY EXECUTIVE OTHER THAN FOR GOOD REASON. Executive may
terminate his employment under this Agreement for any reason other than
"Good Reason" pursuant to Section 10(e) above after providing thirty
(30) days' prior written notice to the Company.
(g) NOTICE OF TERMINATION. Any termination by the Company or by Executive
under this Agreement shall be communicated by notice of termination to
the other party hereto. For purposes of this Agreement, a Notice of
Termination shall mean a notice in writing which shall indicate the
specific termination provision in this Agreement relied upon to
terminate Executive's employment and, if applicable, shall set forth in
reasonable detail the facts and circumstances claimed to provide a
basis for termination of Executive's employment under the provision so
indicated.
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11. COMPENSATION AND BENEFITS PAYABLE FOLLOWING TERMINATION PRIOR TO THE
AGREED RETIREMENT DATE.
In the event that Executive's employment is terminated prior to the Agreed
Retirement Date, Executive (or his surviving spouse, beneficiary or estate, as
the case may be) shall receive the following compensation and benefits:
(a) DEATH. In the event that Executive's employment is terminated by reason
of his death:
(i) HEALTH INSURANCE. The Company shall provide Executive's
surviving spouse with the health insurance benefits set forth
in Section 9(a)(ii)(B) above.
(ii) STOCK OPTIONS. All outstanding unexercised stock options
granted to Executive shall become fully vested and exercisable
as of Executive's date of death.
(iii) SUPPLEMENTAL RETIREMENT BENEFIT. The Company shall provide
Executive's surviving spouse with the supplemental retirement
benefit set forth in Section 8(c) above.
(b) TOTAL DISABILITY. In the event that Executive's employment is
terminated by reason of his Total Disability pursuant to Section 10(b)
above:
(i) HEALTH INSURANCE. The Company shall provide Executive and his
spouse with the health insurance benefits set forth in Section
9(a) above.
(ii) STOCK OPTIONS. All outstanding unexercised stock options
granted to Executive under the Company's stock option plans
(A) shall become fully vested and exercisable as of his
employment termination date and (B) shall continue to be
exercisable until the option expiration date (determined
without regard to Executive's employment termination).
(iii) SUPPLEMENTAL RETIREMENT BENEFIT. The Company shall provide
Executive with the supplemental retirement benefit set forth
in Section 8 above and shall have no further obligations under
Section 5 or Section 9(c) hereof.
(c) TERMINATION FOR CAUSE. In the event that Executive's employment is
terminated by the Company for Cause pursuant to Section 10(c) above:
(i) The Company shall provide Executive with the supplemental
retirement benefit set forth in Section 8 above and shall have
no further obligations under Section 5 or Section 9 hereof.
(ii) If Executive notifies the Company in writing that he intends
to contest the termination for Cause, then the Company shall
continue to provide Executive with the compensation and
benefits that he would have received if he had continued in
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employment until the issuance of a final determination
pursuant to the arbitration procedure set forth in Section 17
below that his employment was terminated for Cause or, if
earlier, the date Executive ceases to contest such
termination. If, however, the Company is the prevailing party
in such arbitration or Executive ceases to contest the
termination after having given the required notice, then the
Company shall have the right to recover from Executive all
compensation paid to Executive under this clause (ii) and the
reasonable cost of all benefits provided to him under this
clause (ii), in each case in excess of the amounts that would
have otherwise been payable or provided to him under this
Agreement; the Company shall have the further right to set off
any such amounts payable by Executive against any amounts
payable by the Company under this Agreement.
(d) TERMINATION BY THE COMPANY WITHOUT CAUSE OR TERMINATION BY EXECUTIVE
FOR GOOD REASON. In the event that Executive's employment is terminated
by the Company without Cause pursuant to Section 10(d) above or
Executive terminates his employment for Good Reason pursuant to Section
10(e) above:
(i) CONTINUATION OF COMPENSATION AND BENEFITS. The Company shall
continue to provide Executive the compensation and benefits
set forth in Section 7 above which would have been payable to
him if he had continued to perform his normal duties and
responsibilities on a full-time basis until the earlier of (i)
the Agreed Retirement Date or (ii) his death, subject to
clause (ii) below relating to the payment of annual incentive
compensation.
(ii) ANNUAL INCENTIVE COMPENSATION. The Company shall pay Executive
the amounts described in this clause (ii) in lieu of the
annual incentive compensation set forth in Section 7(b) above:
(A) For each calendar year commencing after Executive's
last day of employment, the Company shall pay
Executive an amount equal to the incentive
compensation Executive would have earned under the
Company's annual incentive compensation plan for such
calendar year had the Company achieved 100% of such
plan's targets for such calendar year.
(B) For the calendar year in which Executive's employment
is terminated, the Company shall pay Executive (I)
the amount determined under Section 11(f) below, plus
(II) an amount equal to a pro rata portion (based on
the number of days remaining in the calendar year
following Executive's last day of employment) of the
incentive compensation Executive would have earned
under the Company's incentive compensation plan for
such calendar year had the Company achieved 100% of
such plan's targets for such calendar year.
(C) Payments for any calendar year under this clause (ii)
shall be made at the same time and in the same manner
as incentive compensation is paid to
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senior executive officers who are participants in
such annual incentive compensation plan.
(iii) STOCK OPTIONS. All outstanding unexercised stock options
granted to Executive under the Company's stock option plans
(A) shall become fully vested and exercisable as of his
employment termination date and (B) shall continue to be
exercisable until the option expiration date (determined
without regard to Executive's employment termination).
(iv) SPECIAL RETIREMENT BENEFITS. Executive and his surviving
spouse will receive (A) the supplemental retirement benefit
described in Section 8 and (B) the additional retirement
benefits described in Section 9 above, commencing on the
earlier of the Agreed Retirement Date or Executive's death.
(e) TERMINATION BY EXECUTIVE WITHOUT GOOD REASON. In the event that
Executive terminates his employment without Good Reason pursuant to
Section 10(f) above Executive and his surviving spouse shall receive
(A) the supplemental retirement benefits described in Section 8 and (B)
the additional retirement benefits described in Section 9 above,
commencing as of the last day of Executive's employment.
(f) ANNUAL INCENTIVE COMPENSATION. In the event that Executive's employment
is terminated for any reason prior to the last day of a calendar year,
the Company shall pay Executive (or his personal representative) an
amount equal to the pro rata portion (based on the number of days of
employment prior to the termination date) of the annual incentive
compensation that would have been payable to Executive if he had
continued in employment through the end of the calendar year. Such
amount will be paid at the same time and in the same manner as the
annual incentive compensation for such year is paid to other senior
executive officers.
(g) EARNED BUT UNPAID COMPENSATION. Upon termination of Executive's
employment under Section 10 hereof, the Company shall pay Executive (or
his personal representative) any accrued but unpaid Base Salary for
services rendered to the date of termination, the amount of any
compensation previously earned and deferred by Executive, any earned
but unpaid incentive compensation for any calendar year ended prior to
the year in which is employment terminates, any accrued but unpaid
expenses required to be reimbursed under this Agreement, and any
vacation accrued to the date of the termination. The Company shall pay
all of the foregoing amounts, except for earned but unpaid incentive
compensation, within 30 days after the date of termination; earned but
unpaid incentive compensation for any calendar year ended prior to the
year in which Executive's employment terminates shall be paid at the
same time as the Company pays incentive compensation to its other
senior executives.
(h) OTHER COMPENSATION AND BENEFITS. Except as may otherwise be provided
under this Agreement,
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(i) any benefits to which Executive may be entitled pursuant to
the plans, policies and arrangements referred to in Section
7(d) above shall be determined and paid in accordance with the
terms of such plans, policies and arrangements; and
(ii) Executive shall have no right to receive any other
compensation, or to participate in any other plan, arrangement
or benefit, with respect to future periods after such
termination or resignation.
12. ADDITIONAL COMPENSATION FOLLOWING CHANGE OF CONTROL.
(a) APPLICABILITY. Executive shall be entitled to the compensation and
benefits described in this Section 12 if (i) a Change of Control (as
hereinafter defined) occurs and (ii) on or within three years after the
Change of Control Effective Date (as hereinafter defined), Executive's
employment is terminated by the Company without Cause pursuant to
Section 10(d) above or Executive terminates his employment for Good
Reason pursuant to Section 10(e) above.
(b) ADDITIONAL COMPENSATION. In addition to the compensation and benefits
set forth in Section 11(d) above, the Company shall pay Executive an
amount equal to the excess (if any) of:
(i) the product of (A) 2.99 TIMES (B) the sum of (I) an amount
equal to Executive's annual rate of Base Salary at the rate in
effect immediately prior his employment termination date and
(II) the amount of annual incentive compensation that the
Executive would have received had the Company achieved 100% of
the Company's incentive compensation plan targets for the
calendar year in which his employment termination date occurs;
over
(ii) the amount payable under Section 11(d) above;
provided, however, that in no event shall the additional cash
compensation payable under this Section 12(b) exceed an amount equal to
one dollar ($1) less than the amount that would trigger the excise tax
payable under Section 4999 of the Internal Revenue Code with respect to
"excess parachute payments," as defined in Section 280G of the Code, it
being the intention of the parties that the Company shall have no
obligation to make any payment under this Section 12(b) to Executive
upon termination of his employment that would result in the requirement
to pay such excise tax. Such additional cash compensation shall be
payable to Executive in a single lump sum within thirty (30) days after
his employment termination.
(c) Subject to the provisions of Section 12(d) the amount described in
Section 12(b) shall be initially determined by a certified public
accounting firm designated by the Company and agreed to by Executive
(the "Accounting Firm") which determination shall provide detailed
supporting calculations both to the Company and Executive. All fees and
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expenses of the Accounting Firm shall be borne by the Company. The
determination of the Accounting Firm of the amount payable under
Section 12(b) shall be binding on the Company and Executive, and no
greater amount shall be owed by the Company. Notwithstanding the
preceding sentence, if any amount is finally determined pursuant to
Section 12(d) to be subject to the excise tax described in Section
12(b), the Executive shall repay excess amount to the Company within 90
days of such final determination.
(d) Executive shall notify the Company in writing of any claim by the
Internal Revenue Service that, if successful, would require the payment
by Executive of the additional tax described in Section 12(b)
(determined without regard to the repayment obligation of the
Executive). Such notification shall be given as soon as practicable,
but no later than ten (10) business days, after Executive is informed
in writing of such claim and whether Executive chooses to defend such
claim at his own cost and expense or desires the Company to defend such
claim. If Executive notifies the Company that he desires the Company to
defend such claim, then the Company shall defend such claim at its cost
and expense. If Executive elects to have the Company defend such claim,
Executive shall apprise the Company of the notice of such claim and (i)
give the Company any information reasonably requested by the Company
relating to such claim, (ii) take such action in connection with
contesting such claim as the Company shall reasonably request from time
to time; and (iii) cooperate with the Company in good faith in order to
effectively contest such claim.
(e) ESTABLISHMENT OF TRUST. In the event that Executive notifies the
Company that this Section 12(c) is to become effective, the Company
shall, as soon as possible, but in no event later than five (5)
business days after receipt of notice, take the following actions:
(i) The Company shall establish an irrevocable trust for the
purpose of providing funds for the payment of the supplemental
retirement benefits payable pursuant to Section 8 of this
Agreement. Such trust shall be a grantor trust containing
provisions which are the same as, or are similar to, the
provisions contained in the model "rabbi trust" set forth in
IRS Revenue Procedure 92-64. The Company shall pay all costs
relating to the establishment and maintenance of the trust and
the investment of funds held in such trust.
(ii) The Company shall make an irrevocable contribution to the
Trust in an amount that is sufficient to pay Executive (and
his surviving spouse) the supplemental retirement benefits
pursuant to Section 8 above
(f) DEFINITIONS. For purposes of this Section 12:
(i) "Change of Control" shall have the meaning set forth in
Appendix A attached to this Agreement.
(ii) "Change of Control Effective Date" means the date on which a
Change of Control occurs provided that if (A) a Change of
Control occurs, (B) Executive's
Page 13 of 22
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employment with the Company is terminated prior to the date on
which the Change of Control occurs, and (C) such termination
(I) was at the request of a third party who has taken steps
reasonably calculated to effect a Change of Control or (II)
otherwise arose in connection or in anticipation of a Change
of Control, then for all purposes under this Section 12, the
Change of Control Effective Date shall mean the date
immediately prior to the date of such termination of
employment.
13. RESTRICTIVE COVENANTS.
(a) RESTRICTIONS. Executive covenants that, except in furtherance of his
duties hereunder and as approved by the Board or Chief Executive
Officer:
(i) COMPETITIVE ACTIVITY. During the Restricted Period (as
hereinafter defined), Executive shall not directly or
indirectly, own any interest in, participate or engage in,
assist, render any services (including advisory services) to,
become associated with, work for, serve (in any capacity
whatsoever, including, without limitation, as an employee,
consultant, advisor, agent, independent contractor, officer or
director) or otherwise become in any way or manner connected
with the ownership, management, operation, or control of, any
business, firm, corporation, partnership, trust or other
business or governmental entity (collectively, together with
any individual, a "Person") that engages in, or assists others
in engaging in or conducting, any business that deals,
directly or indirectly, in products or services similar to or
competitive with the Company's product line or services
anywhere in the world that the Company does business as of
Executive's last day of employment; provided, however, that
the restrictions set forth above shall not be deemed to
exclude the Executive from acting as director of a corporation
for the benefit of the Company with the consent of the Board;
and provided, further, that the restrictions set forth above
shall not be deemed to prohibit Executive from owning or
acquiring securities issued by any corporation whose
securities are listed on a national securities exchange or are
quoted on Nasdaq or the OTC Bulletin Board, provided that the
Executive at no time owns, directly or indirectly,
beneficially or otherwise, one (1%) percent or more of any
class of any such corporation's outstanding capital stock.
(ii) NON-SOLICITATION OF CUSTOMERS. During the Restricted Period,
Executive shall not knowingly provide or solicit to provide to
any Person any goods or services that are competitive with
those provided by the Company or that would be competitive
with the goods or services that the Company has planned to
provide. The term "customer" shall mean any Person to whom the
Company has provided goods and services during the last five
(5) years of Executive's employment by the Company.
(iii) NON-SOLICITATION OF COMPANY PERSONNEL. During the Restricted
Period, Executive will not solicit for employment, or attempt
to solicit, directly or by
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16
assisting others, any employee of Company with whom Executive
had contact during Executive's employment with the Company.
For the purposes of this paragraph, "contact" means any
interaction whatsoever between Executive and the other
employee.
(iv) PROTECTED INFORMATION. Executive shall not divulge to others,
nor shall he use at any time during the Restricted Period or
thereafter, any confidential or trade secret information
obtained by him during the course of his employment with the
Company, including information relating to sales, salesmen,
sales volume or strategy, customers, formulas, processes,
methods, machines, manufactures, compositions, ideas,
improvements or inventions belonging to or relating to the
business of the Company, or its subsidiary or affiliated
companies.
(v) NON-DISPARAGEMENT. Executive covenants and agrees that during
the Restricted Period or at any time thereafter, Executive
shall not, directly or indirectly, in public or private,
deprecate, impugn, disparage, or make any remarks that would
tend to or be construed to tend to defame the Company or any
of its employees, members of its board of directors or agents,
nor shall Executive assist any other person, firm or company
in so doing.
(b) DEFINITION OF "RESTRICTED PERIOD." For purposes of this Agreement, the
term "Restricted Period" shall mean the Employment Period and the
period of five (5) years after the end of the Employment Period.
(c) ENFORCEMENT OF COVENANTS. Executive acknowledges that his breach of any
of the restrictive covenants contained in this Section 13 may cause
irreparable damage to the Company for which remedies at law would be
inadequate. Accordingly, if Executive breaches or threatens to breach
any of the provisions of this Section 13, the Company shall be entitled
to appropriate injunctive relief, including, without limitation,
preliminary and permanent injunctions, in any court of competent
jurisdiction, restraining Executive from taking any action prohibited
hereby. This remedy shall be in addition to all other remedies
available to the Company at law or in equity. If any portion of this
Section 13 is adjudicated to be invalid or unenforceable, this Section
13 shall be deemed amended to delete therefrom the portion so
adjudicated, such deletion to apply only with respect to the operation
of this Section 13 in the jurisdiction in which such adjudication is
made.
14. PROPRIETARY PROPERTY.
(a) OWNERSHIP OF PROPRIETARY PROPERTY. Executive agrees that any and all
inventions, discoveries, investigations, know-how, trade secrets and
developments or improvements in technology (collectively "Inventions")
as well as any and all Proprietary Information (as defined in Section
14(b)) created, developed, conceived of or discovered during the
Employment Period (i) by Executive (solely or jointly with others)
either (A) in the course of his employment or engagement, on the
Company's time or with the Company's materials or facilities, or (B)
relating to any subject matter with which his work for the
Page 15 of 22
17
Company is or may be concerned or to any business in which the Company
or any of its subsidiaries or affiliated companies is involved,
regardless of how or when he shall have created, developed, conceived,
or discovered such Inventions or Proprietary Information (collectively,
"Proprietary Property"), or (ii) by or for the Company, or (iii) by any
independent Person and thereafter acquired by the Company, and which
are within the Executive's knowledge or possession in the case of (i)
above or that come into the Executive's knowledge or possession during
the Restricted Period in the case of (ii) or (iii) above, shall be, if
created, developed, conceived of or discovered by the Executive,
promptly disclosed to the Company, or shall be, if otherwise developed
or acquired by the Company, received by Executive as an employee,
consultant or retiree of the Company and not in any way for his own
benefit. Executive shall neither have nor obtain any right, title or
interest in or to such Proprietary Property unless and until the
Company shall expressly and in writing waive the rights that it has
therein and thereto under the provisions of this Section. With respect
to any and all Proprietary Property that is invented, created, written,
developed, furnished or produced by Executive, or suggested by
Executive to the Company, during the Employment Period, Executive does
hereby agree that all such Proprietary Property shall be the exclusive
property of the Company, and that the Executive shall neither have nor
retain any right, title or interest, of any kind therein and thereto or
in and to any results or proceeds therefrom. At any time, whether
during or after the Employment Period, the Executive will, upon the
request and at the expense of the Company, (A) obtain patents or
copyrights on, or (B) permit the Company to patent or copyright, any
such Proprietary Property, whichever (A) or (B) is appropriate, and/or
(C) execute, acknowledge and deliver any and all assignments,
instruments of transfer, or other documents, that the Company deems
necessary or appropriate to transfer to and vest in the Company all
right, title and interest in and to such Proprietary Property and to
evidence the Company's ownership of such Proprietary Property,
including, without limitation, taking all steps necessary to enable the
Company to publish or protect said Proprietary Property by patents or
otherwise in any and all countries and to render all such assistance as
the Company may require in any patent office proceeding or litigation
involving said Proprietary Property. Executive shall not, without
limitation as to time or place, use any Proprietary Property except on
Company business, during or after the Employment Period, nor disclose
the same to any other Person or individual except for disclosure on
Company business or as may be required by law.
(b) DEFINITION OF PROPRIETARY INFORMATION. As used in this Agreement,
"Proprietary Information" means any information about the affairs of
the Company or any of its subsidiaries or affiliates, including,
without limitation, trade secrets, trade "know-how", inventions,
customer lists, client lists, business plans, operational methods,
pricing policies, marketing plans, sales plans, identity of suppliers,
trading positions, sales, profits or other financial information, which
is confidential to the Company or any of its subsidiaries or affiliates
or is not generally known in the relevant trade, regardless of whether
Executive developed such information.
(c) DISCLOSURE OF PROPRIETARY PROPERTY. During the Employment Period and
thereafter, the Executive will not, directly or indirectly, lecture
upon, publish articles concerning, use,
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18
disseminate, disclose, sell or offer for sale any Proprietary Property
without the Company's prior written permission.
15. INDEMNIFICATION.
(a) The Company agrees that if the Executive is made a party, or is
threatened to be made a party, to any action, suit or proceeding,
whether civil, criminal, administrative or investigative (a
"Proceeding"), by reason of the fact that he is or was a director,
officer or employee of the Company or is or was serving at the request
of the Company as a director, officer, member, employee or agent of
another corporation, partnership, joint venture, trust or other
enterprise, including services with respect to employee benefits plans,
whether or not the basis of such Proceeding is the Executive's alleged
action in an official capacity while serving as a director, officer,
employee or agent, the Executive shall be indemnified and held harmless
by the Company to the fullest extent legally permitted or authorized by
the Company's certificate of incorporation or bylaws or resolutions of
the Board or, if greater, by the laws of the Company's state of
incorporation against all cost, expense, liability and loss (including
without limitation, attorneys' fees, judgments, fines, ERISA excise
taxes or penalties and amounts paid or to be paid in settlement)
reasonably incurred or suffered by the Executive in connection
therewith, and such indemnification shall continue as to the Executive
even if he has ceased to be a director, member, employee or agent of
the Company or other entity and shall inure to the benefit of the
Executive's heirs, executors and administrators. The Company shall
advance the Executive all reasonable costs and expenses incurred by him
in connection with a Proceeding within twenty (20) days after receipt
by the Company of a written request for such advance. Such request
shall include an undertaking by the Executive to repay the amount of
such advance if it shall ultimately be determined that he is not
entitled to be indemnified against such costs and expenses.
(b) Neither the failure of the Company (including its Board, independent
legal counsel or shareholders) to have made a determination prior to
the commencement of any Proceeding concerning payment of amounts
claimed by the Executive under paragraph (a) above that indemnification
of the Executive is proper because he has met the applicable standard
of conduct, nor a determination by the Company (including its Board,
independent legal counsel or shareholders) that the Executive has not
met such applicable standard of conduct, shall create a presumption
that the Executive has not met the applicable standard of conduct.
(c) The Company shall continue and maintain a directors' and officers'
liability insurance policy covering the Executive to the extent the
Company provides such coverage for its other senior executive officers.
Page 17 of 22
19
16. WITHHOLDING OF TAXES.
The Company shall withhold from any compensation and benefits payable under this
Agreement all applicable federal, state, local, or other taxes.
17. ARBITRATION OF DISPUTES.
Except as provided in Section 13 above, any dispute, controversy or claim
arising out of or pursuant to this Agreement or the breach hereof shall be
settled by arbitration in the City of New York, State of New York. Such
arbitration shall be effected by arbitrators selected as hereinafter provided
and shall be conducted in accordance with the National Rules for the Resolution
of Employment Disputes, existing at the date thereof, of the American
Arbitration Association. The dispute, controversy or claim shall be submitted to
three arbitrators, one arbitrator to be selected by the Company, one arbitrator
to be selected by the Executive and the third arbitrator to be selected by the
two so selected by the Company and the Executive, or if they cannot agree on a
third, by the American Arbitration Association. In the event that either the
Company or the Executive within one (1) month after notification of any demand
for arbitration hereunder, shall not have selected its arbitrator and given
notice thereof to the other party in accordance with the terms of Section 23 of
this Agreement, the arbitrator for such party shall be selected by the American
Arbitration Association. Meetings of the arbitrators shall be held in New York,
New York, or at such other place or places as may be agreed upon by the parties
and the arbitrators. The results of final determination of any such arbitration
proceedings shall be binding on the parties hereto and a judgment may be entered
in any court having jurisdiction.
18. PAYMENT OF FEES, EXPENSES AND INTEREST.
If Executive is the prevailing party in any arbitration conducted under Section
17 hereof, the Company shall promptly reimburse Executive for all fees and
expenses (including legal, consultants' and other professional fees and
expenses) incurred by Executive in connection with such arbitration. In
addition, the Company shall pay Executive interest on any delayed payment under
this Agreement at the applicable federal rate provided for in Section
7872(f)(2)(A) of the Internal Revenue Code (or any successor to such section).
19. NO CLAIM AGAINST ASSETS.
Nothing in this Agreement shall be construed as giving Executive any claim
against any specific assets of the Company or as imposing any trustee
relationship upon the Company in respect of Executive. Subject to Section 12(c)
above and Section 20 below, the Company shall not be required to establish a
special or separate fund or to segregate any of its assets in order to provide
for the satisfaction of its obligations under this Agreement. Executive's rights
under this Agreement shall be limited to those of an unsecured general creditor
of the Company and its affiliates.
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20
20. SUCCESSORS AND ASSIGNMENT.
Except as otherwise provided in this Agreement, this Agreement shall inure to
the benefit of and be binding upon the parties hereto and their respective
heirs, representatives, successors and assigns.
(a) COMPANY SUCCESSOR. In the event of a Change of Control, the Company
shall require any person (or persons acting as a group) who acquires
ownership or effective control of the Company or ownership of a
substantial portion of the business or assets of the Company (whether
direct or indirect, by purchase, merger, consolidation or otherwise),
by agreement in form and substance reasonably satisfactory to
Executive, expressly to assume and agree to perform this Agreement in
the same manner and to the same extent as the Company would be required
to perform it if no such Change of Control had taken place. In the
event that the Company fails to obtain such agreement prior to or
concurrently with the effectiveness of any such Change of Control, the
Company shall establish an irrevocable trust fund or similar
arrangement containing assets sufficient to assure payment of all
obligations under this Agreement, provided that Executive's right to
payment from such trust fund or arrangement shall be no greater than
the right of an unsecured creditor of the Company and its affiliates.
As used in this Agreement, the "Company" shall mean the Company as
defined in the first sentence of this Agreement and any Person (or
group) that acquires ownership or effective control of the Company or
ownership of a substantial portion of the business or assets of the
Company or which otherwise becomes bound by all the terms and
provisions of this Agreement, whether by the terms hereof, by operation
of law or otherwise.
(b) ASSIGNMENT BY EXECUTIVE. The rights and benefits of Executive under
this Agreement are personal to him and no such right or benefit shall
be subject to voluntary or involuntary alienation, assignment or
transfer; provided, however, that nothing in this Section 20 shall
preclude Executive from designating a beneficiary or beneficiaries to
receive any benefit payable on his death.
21. ENTIRE AGREEMENT; AMENDMENT.
This Agreement shall supersede any and all existing oral or written agreements,
representations, or warranties between Executive and the Company or any of its
subsidiaries or affiliated entities relating to the terms of Executive's
employment. It may not be amended except by a written agreement signed by both
parties.
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21
22. GOVERNING LAW.
This Agreement shall be governed by and construed in accordance with the laws of
the State of New York applicable to agreements made and to be performed in that
State, without regard to its conflict of laws provisions.
23. NOTICES.
Any notice, consent, request or other communication made or given in connection
with this Agreement shall be in writing and shall be deemed to have been duly
given when delivered or mailed by registered or certified mail, return receipt
requested, or by facsimile or by hand delivery, to those persons listed below at
their following respective addresses or at such other address as each may
specify by notice to the others:
To the Company:
Paxar Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
To Executive:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
24. MISCELLANEOUS.
(a) NO SET-OFF, ETC. Except as otherwise provided in Section 11(c)(ii), the
Company's obligation to make the payments provided for in this
Agreement and otherwise perform its obligations under this Agreement
shall not be affected by any set-off, counterclaim, recoupment,
defense, or other claim, right, or action that the Company may have
against Executive.
(b) WAIVER. The failure of a party to insist upon strict adherence to any
term of this Agreement on any occasion shall not be considered a waiver
thereof or deprive that party of the right thereafter to insist upon
strict adherence to that term or any other term of this Agreement.
(c) SEVERABILITY. If any term or provision of this Agreement is declared
illegal or unenforceable by any court of competent jurisdiction and
cannot be modified to be enforceable, such term or provision shall
immediately become null and void, leaving the remainder of this
Agreement in full force and effect.
Page 20 of 22
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(d) HEADINGS. Section headings are used herein for convenience of reference
only and shall not affect the
meaning of any provision of this Agreement.
(e) RULES OF CONSTRUCTION. Whenever the context so requires, the use of the
singular shall be deemed to include the plural and vice versa.
(f) TERM OF PAYMENTS TO AND BENEFITS FOR SURVIVING SPOUSE. If ▇▇▇▇▇
▇▇▇▇▇▇▇▇, Executive's spouse on the date of this Agreement, is
Executive's surviving spouse at the time of his death, then she shall
be entitled to receive the payments to and benefits provided for a
surviving spouse under Sections 8 and 9 of this Agreement for the
periods specified therein. However, if ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ is not
Executive's surviving spouse at the time of his death, for purposes of
Sections 8 and 9 of this Agreement, Executive's surviving spouse, if
any, shall be entitled to receive the amounts payable to and benefits
provided for a surviving spouse under this Agreement until the earlier
of (i) the date of such surviving spouse's death or (ii) the last date
on which ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ would have been entitled to receive such
payment or benefit, the date of death of such surviving spouse being
deemed to be the last day of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇'▇ life expectancy used by
the Company for purposes of preparing the Company's financial
statements to determine the accrual of the Company's expenses resulting
from such payments and benefits.
(g) COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an
original, and such counterparts will together constitute but one
Agreement.
SIGNATURE PAGE FOLLOWS
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the day and year set forth below.
PAXAR CORPORATION EXECUTIVE
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------ -----------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Name: ▇▇▇ ▇▇▇▇▇▇▇
---------------------------------
Title: Chairman, Compensation Committee Date: July 11, 2001
-------------------------------- -----------------------------
Date: July 11, 2001
---------------------------------
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APPENDIX A
DEFINITION OF CHANGE OF CONTROL
For purposes of Section 12 of this Agreement, "Change of Control" means:
(a) The acquisition by any individual, 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")) of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or
more of either (1) the then outstanding shares of common stock of the
Company (the "Outstanding Company Common Stock") or (2) 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"); provided, however, that for
purposes of this clause (A), the following acquisitions of stock shall
not result in a Change of Control: (1) any acquisition directly from
the Company, (2) any acquisition by the Company, (3) any acquisition by
any employee benefit plan (or related trust) sponsored or maintained by
the Company or any corporation controlled by the Company, or (4) any
acquisition by any corporation pursuant to a transaction that complies
with clauses (1), (2), and (3) of subsection (c) of this definition; or
(b) Individuals who, as of the date hereof, constitute the Company's Board
of Directors (the "Incumbent Board") cease for any reason to constitute
at least a majority of the Company's Board of Directors; provided,
however, that any individual becoming a director subsequent to the date
hereof whose election, or nomination for election, by the Company's
shareholders was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall be considered as
though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial
assumption of office occurs as a result of an actual or threatened
election contest with respect to the election or removal of directors
or other actual or threatened solicitation of proxies or consents by or
on behalf of a Person other than the Company's Board of Directors; or
(c) Consummation of a reorganization, merger, or consolidation or sale or
other disposition of all or substantially all of the assets of the
Company (a "Business Combination"), in each case, unless following such
Business Combination, (1) all or substantially all of the individuals
and entities who were the beneficial owners, respectively, of the
Outstanding Company Common Stock and Outstanding Company Voting
Securities immediately prior to such Business Combination beneficially
own, directly or indirectly, more than 60% of, respectively, the
outstanding shares of common stock and the combined voting power of the
then outstanding voting securities entitled to vote generally in the
election of directors, as the case may be, of the corporation resulting
from such Business Combination, including, without limitation, a
corporation that as a result of such transaction owns the Company or
all or substantially all of the Company's assets either
A-1
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directly or through one or more subsidiaries (any such corporation
being referred to herein as a "Resulting Corporation"), in
substantially the same proportions as their ownership of the
Outstanding Company Common Stock and Outstanding Company Voting
Securities, as the case may be, immediately prior to such Business
Combination, (2) no Person (excluding any employee benefit plan (or
related trust) of the Company or a Resulting Corporation) beneficially
owns, directly or indirectly, 30% or more of, respectively, the
outstanding shares of common stock of the Resulting Corporation or the
combined voting power of the then outstanding voting securities of such
Resulting Corporation except to the extent that such ownership existed
prior to the Business Combination, and (3) at least a majority of the
members of the board of directors of the Resulting Corporation were
members of the Incumbent Board at the time of the execution of the
initial agreement, or of the action of the Board, providing for such
Business Combination; or
(d) Approval by the shareholders of the Company of a complete liquidation
or dissolution of the Company.
A-2