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EXHIBIT
10.70
DANKA BUSINESS SYSTEMS
PLC
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Change of Control Agreement
for Rod Denzer
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12/02/05
DANKA BUSINESS SYSTEMS
PLC
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Change of
Control Agreement for Rod Denzer
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1.
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Definitions |
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1 |
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2.
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Term of
Agreement |
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4 |
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3.
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Reimbursement of Business Expenses |
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4 |
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4.
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Entitlement to Severance Benefit |
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4 |
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5.
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Confidentiality and Related Covenants |
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7 |
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6.
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Amendment
or Termination |
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9 |
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7.
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Resolution of Disputes |
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9 |
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8.
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Miscellaneous Provisions |
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CHANGE OF CONTROL
AGREEMENT
AGREEMENT, made and entered
into as of the 6 day of July, 2006 by and among Danka Business
Systems PLC (“Danka Business Systems”), Danka Office
Imaging Company (“Danka”) (Danka Business Systems and
Danka sometimes referred to herein together with their respective
successors and assigns as the “Company”) and Rod
Denzer, an individual (the “Executive”).
W I T N E S S E T
H:
WHEREAS,
Executive is an employee of the Company serving in an executive
capacity;
WHEREAS, the
Board of Directors of each corporation included in the Company (the
“Board”) believes it is necessary and desirable that
the Company be able to rely upon Executive to continue serving in
his or her position in the event of a pending or actual Change of
Control (as defined) of the Company;
NOW,
THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the
receipt and sufficiency of which is mutually acknowledged, the
Company and Executive (individually a “Party” and
together the “Parties”) agree as follows:
(a) “Base Salary” shall mean
Executive’s annual base salary in effect at the time of the
Change of Control or at the time of termination of employment,
whichever is greater.
(b) “Cause” shall mean and
be limited to:
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(i) |
Executive’s commission of any crime that
(i) constitutes a felony in the jurisdiction involved or
(ii) involves loss or damage to or destruction of property of
the Company or (iii) results in the incarceration of Executive
following his conviction for such crime; or
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(ii) |
Executive’s willful and material violation of any lawful
directions of the Company’s Chief Executive or Board after
the Company has provided written notice to Executive and said
violation continues after Executive shall have reasonable
opportunity to cure said violation.
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For purposes of this
Agreement, an act or failure to act on Executive’s part shall
be considered “willful” if it was done or omitted to be
done by Executive not in good faith, and shall not include any act
or failure to act resulting from any incapacity of
Executive.
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(c) |
A
“Change of Control” shall be deemed to have occurred
when:
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(i) |
securities
of Danka Business Systems representing more than 30 percent of the
combined voting power of the then outstanding voting securities of
Danka Business Systems are acquired pursuant to a general offer for
the issued share capital of the Company which is an offer regulated
under the U.K. Take-Over Code or any other tender offer or an
exchange offer by any person or group of persons acting
in
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concert
(within the meaning of Section 14(d) of the Securities
Exchange Act of 1934) other than the Company, a direct or indirect
subsidiary or parent of the Company, an employee benefit plan or
similar trust established by the Company;
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(ii) |
a merger
or consolidation is consummated in which Danka Business Systems is
a constituent corporation and which results in less than 50 percent
of the outstanding voting securities of the surviving or resulting
entity being owned by the then existing stockholders of Danka
Business Systems;
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(iii) |
a sale is
consummated by the Company of substantially all of the
Company’s assets (or substantially all of the assets of
Danka) to a person or entity which is not a wholly-owned subsidiary
of Danka Business Systems or any of its affiliates; or
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(iv) |
during any
period of two consecutive years, individuals who, at the beginning
of such period, constituted the Board of Directors of Danka
Business Systems (the “Board”) cease, for any reason,
to constitute at least a majority thereof, unless the election or
nomination for election for each new director was approved by the
vote of at least two-thirds of the directors then still in office
who were directors at the beginning of such two-year
period.
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For purposes of this
Agreement, no Change of Control shall be deemed to have occurred
with respect to Executive if the Change of Control results from
actions or events in which Executive is a participant in a capacity
other than solely as an officer, employee or director of the
Company.
(d) “Code” means the
Internal Revenue Code of 1986, as amended.
(e) “Disability” shall mean
a physical or mental illness which, in the judgment of the Company
after consultation with the licensed physician attending Executive,
impairs Executive’s ability to substantially perform his
duties as an employee and as a result of which Executive shall have
been unable to perform his duties for the Company on a full-time
basis for a period of 180 consecutive days.
(f) “Effective Date” shall
mean the date of this Agreement, as set forth above.
(g) “Excise Taxes” shall
have the meaning set forth in Section 4 below.
(h) “Good Reason” shall mean
the occurrence of one or more of the following events without
Executive’s prior written consent (except as a result of a
prior termination):
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(i) |
any
material change in Executive’s status, title, authorities or
responsibilities (including reporting responsibilities) which
represents a demotion from Executive’s status, title,
position or responsibilities (including reporting responsibilities)
prior to the Change of Control; the assignment to Executive of any
duties or work responsibilities which are materially inconsistent
with Executive’s status, title, position or work
responsibilities prior to the Change of Control, or which are
materially inconsistent with the status, title, position or work
responsibilities of a similarly situated senior officer; or any
removal of Executive from, or failure to appoint, elect, reappoint
or reelect Executive to, any of such positions, except in the event
of Executive’s death or Disability;
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(ii) |
any
decrease in Executive’s annual Base Salary or target annual
incentive award opportunity;
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(iii) |
the
reassignment of Executive to a location more than thirty
(30) miles from Executive’s then-current work
location;
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(iv) |
the
failure by the Company to continue in effect any incentive, bonus
or other compensation plan in which Executive participates, unless
an equitable arrangement (embodied in an ongoing substitute or
alternative plan) has been made with respect to the failure to
continue such plan, or the failure by the Company to continue
Executive’s participation therein, or any action by the
Company which would directly or indirectly materially reduce his
participation therein or reward opportunities thereunder; provided,
however, that Executive continues to meet substantially all
eligibility requirements thereof;
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(v) |
the
failure by the Company to continue in effect any employee benefit
plan (including any medical, hospitalization, life insurance,
disability or other group benefit plan in which Executive
participates), or any material fringe benefit or perquisite enjoyed
by Executive unless an equitable arrangement (embodied in an
ongoing substitute or alternative plan) has been made with respect
to the failure to continue such plan, or the failure by the Company
to continue Executive’s participation therein, or any action
by the Company which would directly or indirectly materially reduce
Executive’s participation therein or reward opportunities
thereunder, or the failure by the Company to provide Executive with
the benefits to which Executive is entitled as an employee of the
Company; provided, however, that Executive continues to meet
substantially all eligibility requirements thereof,
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(vi) |
any
purported termination of Executive’s employment for Cause
which is not effected by the Company’s delivering written
notice to Executive of the termination for Cause which notice
describes the specific acts or omissions alleged to constitute
Cause; or
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(vii) |
the
failure of the Company to obtain a satisfactory agreement from any
successor or assignee of the Company to fully assume and agree to
perform this Agreement.
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(i) “Retirement” shall mean
Executive’s termination of employment with the Company at or
after attaining age 65.
(j) “Severance Payments”
shall have the meaning set forth in Section 4
below.
(k) “Term” shall have the
meaning set forth in Section 2 below.
The term of
this Agreement shall commence on the Effective Date and , subject
to any amendment or termination of the Agreement by the Parties
permitted by Section 6 below, shall remain in effect until
such time as Executive’s employment may be terminated in
circumstances which do not entitle the Executive to Severance
Payments under this Agreement (the “ Term”). If a
Change of Control shall have occurred during the Term, including
during the one-year notice period provided for in Section 6
following the delivery by the Company of notice of its intent to
terminate the Agreement , notwithstanding any other provision of
this Section 2, the Term shall not expire earlier than two
years after the effective date of such Change of
Control.
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3. |
Reimbursement of Business Expenses.
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Executive is
authorized to incur reasonable expenses in carrying out
Executive’s duties and responsibilities on the
Company’s behalf, and the Company shall promptly reimburse
Executive for all business expenses incurred in connection
therewith, subject to documentation in accordance with the
Company’s policy.
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4. |
Entitlement to Severance Benefit.
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(a) Severance Benefit. In the
event Executive’s employment with the Company is terminated
without Cause, other than due to death, Disability or Retirement,
or in the event Executive terminates his/her employment for Good
Reason, in either case within two years following a Change of
Control, or in the event that prior to the consummation of a
pending Change of Control Executive’s employment is
involuntarily terminated without Cause (other than due to death or
Disability) as a condition to the consummation of the proposed
transaction, whether at the request of the acquiring firm or
otherwise, Executive shall be entitled to receive:
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(i) |
Base
Salary through the date of termination of Executive’s
employment, which shall be paid in a cash lump sum not later than
30 days following Executive’s termination of
employment;
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(ii) |
an amount
equal to twelve (12) full months of Executive’s Base
Salary, at the rate in effect on the date of termination of
Executive’s employment (or in the event a reduction in Base
Salary is a basis for a termination by Executive for Good Reason,
then the Base Salary in
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effect
immediately prior to such reduction), payable in a cash lump sum
not later than 30 days following Executive’s termination of
employment;
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(iii) |
a pro rata
annual bonus for the fiscal year which includes the date of
termination, calculated by multiplying the annual bonus Executive
would have earned for the fiscal year of termination, if the
Company’s financial performance targets for the fiscal year
were deemed to be satisfied at a level equal to the financial
performance achieved through the date of termination, or, if
greater, any performance bonus Executive is guaranteed to receive
for the fiscal year under the terms of his employment agreement, by
a percentage equal to the ratio of the number of days worked by
Executive during the fiscal year of the termination to the total
number of work days during such fiscal year, payable in a cash lump
sum not later than 30 days following Executive’s termination
of employment;
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(iv) |
an amount
equal to one times the annual bonus Executive would earn for the
fiscal year of termination if the Company’s financial
performance targets were deemed to be satisfied at the level equal
to the financial performance achieved through the date of
termination, or, if greater, any performance bonus Executive is
guaranteed to receive for the fiscal year under the terms of his
employment agreement, payable in a cash lump sum not later than 15
days following Executive’s termination of
employment;
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(v) |
immediate
vesting of all outstanding stock options and the right to exercise
such stock options at any time during an extended exercise period
of not less than 36 months following Executive’s termination
of employment, or the remainder of the exercise period, if less, in
each case, to the extent permitted by the terms of the
Company’s stock option schemes;
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(vi) |
settlement of
all deferred compensation arrangements in accordance with any then
applicable deferred compensation plan or election form;
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(vii) |
continued
medical, hospitalization, life and other insurance benefits being
provided to Executive and Executive’s family at the date of
termination, for a period of up to twelve (12) months after
the date of termination; provided that the Company shall have no
obligation to continue to provide Executive with these benefits for
any periods after the date Executive obtains comparable benefits
(with no significant pre-existing condition exclusions) as a result
of Executive’s employment in a new position; and
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(viii) |
other or
additional benefits then due or earned in accordance with
applicable plans and programs of the Company.
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(b) Reduction in Compensation to
Avoid Excise Tax. In the event Executive would become entitled
to any amounts payable in connection with a Change of Control
(whether or not such amounts are payable pursuant to this
Agreement) (the “Severance Payments”), if any of such
Severance Payments would otherwise be subject to the excise tax on
excess golden parachute payments imposed by Section 4999 of
the Code (or any similar federal, state or local tax that may
hereafter be imposed) (the “Excise Tax”), as determined
in accordance with this Section 4(b), but prior to giving
effect to any adjustment under this Section 4(b), the
following provisions shall apply:
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(i) |
For
purposes of determining whether any of the Severance Payments would
be subject to the Excise Tax and the amount of such Excise
Tax:
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(A) |
Severance
Payments, including any payments or benefits other than those under
this Section
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