EXHIBIT 10.53
CHANGE OF CONTROL
EMPLOYMENT AGREEMENT
AGREEMENT by and between Kewaunee
Scientific Corporation, a Delaware corporation (the
“Company”) and Elizabeth D. Phillips (the
“Executive”), restated effective as of the 4
th day of December, 2008.
The Board of Directors of the
Company (the “Board”) has determined that it is in the
best interests of the Company and its stockholders to assure that
the Company will have the continued dedication of the Executive,
notwithstanding the possibility, threat or occurrence of a Change
of Control (as defined below) of the Company. The Board believes it
is imperative to diminish the distraction of the Executive by
virtue of the personal uncertainties and risks created by a pending
or threatened Change of Control and to encourage the
Executive’s full attention and dedication to the Company
currently and in the event of any threatened or pending Change of
Control, and to provide the Executive with compensation and
benefits arrangements upon a Change of Control which ensure that
the compensation and benefits expectations of the Executive will be
satisfied and which are competitive with those of other
corporations. Therefore, in order to accomplish these objectives
the Board has caused the Company to enter into this
Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED
AS FOLLOWS:
1. Change of Control Date .
(a) The “Change of Control Date” shall mean the
first date during the term of this Agreement on which a Change of
Control (as defined in Section 2) occurs; provided, that the
Executive’s employment with the Company shall be considered
to have occurred the Change of Control Date if it is reasonably
demonstrated by the Executive that such termination of employment
(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 with or in anticipation of
a Change of Control.
(b) The term of this Agreement shall
commence on the date hereof and, if no Change of Control Date
occurs, shall end on November 12, 2011 , subject to
extension by mutual agreement of the parties. If a Change of
Control Date occurs on or before such date, the term of this
Agreement shall end on the later of the last day of the Employment
Period as defined in Section 3 (whether such date is prior to
or after such third anniversary) or the end of the Protection
Period as defined in Section 6.
2. Change of Control . For
the purpose of this Agreement, a “Change of Control”
shall mean:
(a) The acquisition by any one
person, or more than one person acting as a group, of ownership of
stock of the Company that, together with stock held by such person
or group, constitutes more than 50% of the total fair market value
or total voting power of the Company’s stock; or
(b) Either, (i) the acquisition
by any one person, or more than one person acting as a group,
during the twelve consecutive month period ending on the date of
the most recent such acquisition, of ownership of stock of the
Company possessing 30% or more of the total voting power of the
Company’s stock, or (ii) the replacement of a majority
of the members of the Company’s Board of Directors during any
twelve month period by directors whose appointment or election is
not endorsed by a majority of the members of the Board of Directors
before the date of the appointment or election; or
(c) The acquisition by any person,
or more than one person acting as a group, during the twelve month
period ending on the date of the most recent acquisition, of assets
from the Company that have a total gross fair market value equal to
40% or more of the total gross fair market value of all of the
Company’s assets immediately before such acquisition or
acquisitions.
3. Employment Period . The
Company hereby agrees to continue the Executive in its employ,
subject to the terms and conditions of this Agreement, for the
period (the “Employment Period”) commencing on the
Change of Control Date and ending on the third anniversary of such
date, unless sooner terminated pursuant to
Section 5.
4. Terms of Employment .
(a) Position and Duties.
(i) During the Employment Period,
(A) the Executive’s position (including status, offices,
titles and reporting requirements), authority, duties and
responsibilities shall be at least commensurate in all material
respects with the most significant of those held, exercised and
assigned to the Executive at any time during the 120-day period
immediately preceding the Change of Control Date, and (B) the
Executive’s services shall be performed within the
Statesville/Charlotte, North Carolina, area, unless he otherwise
consents. Subject to the foregoing, the Executive may be
transferred to the payroll of an entity that is controlled by, or
controls, the Company, and in such event the term
“Company” shall be deemed to include such
entity.
(ii) During the Employment Period,
and excluding any periods of vacation and sick leave to which the
Executive is entitled, the Executive agrees to devote his attention
and time during normal business hours to the business and affairs
of the Company and, to the extent necessary to discharge the
responsibilities assigned to the Executive hereunder, to use the
Executive’s reasonable best efforts to perform faithfully and
efficiently such responsibilities. It shall not be a violation of
this Agreement for the Executive to (A) serve on corporate,
civic or charitable boards or committees, (B) deliver
lectures, fulfill speaking engagements or teach at educational
institutions, and (C) manage personal investments, so long as
such activities do not significantly interfere with the performance
of the Executive’s responsibilities as an employee of the
Company in accordance with this Agreement.
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(b) Compensation.
(i) Base Salary. During the
Employment Period, the Executive shall receive an annual base
salary (“Annual Base Salary”), which shall be paid at a
monthly rate, at least equal to twelve times the highest monthly
base salary paid or payable, including any base salary which has
been earned but deferred, to the Executive by the Company in
respect of the twelve-month period immediately preceding the month
in which the Change of Control Date occurs. During the Employment
Period, the Annual Base Salary shall be reviewed no more than 12
months after the last salary increase awarded to the Executive
prior to the Change of Control Date and thereafter at least
annually. Any increase in Annual Base Salary shall not serve to
limit or reduce any other obligation to the Executive under this
Agreement. Annual Base Salary shall not be reduced after any such
increase, and the term Annual Base Salary as utilized in this
Agreement shall refer to Annual Base Salary as so
increased.
(ii) Annual Bonus. In addition to
Annual Base Salary, the Executive shall be awarded, for each fiscal
year ending during the Employment Period, an annual bonus (the
“Annual Bonus”) in cash at least equal to the average
of the Executive’s bonus under the Company’s annual
incentive bonus plan or any comparable bonus under any predecessor
or successor plan, for the last three full fiscal years prior to
the Change of Control Date (annualized in the event that the
Executive was not employed by the Company for the whole of any such
fiscal year) (the “Average Annual Bonus”). Each such
Annual Bonus shall be paid no later than the end of the second
month of the fiscal year next following the fiscal year for which
the Annual Bonus is awarded, unless the Executive shall elect to
defer the receipt of such Annual Bonus.
(iii) Incentive, Savings and
Retirement Plans. During the Employment Period, the Executive shall
be entitled to participate in all incentive, stock option, savings
and retirement plans, practices, policies and programs applicable
generally to other peer executives of the Company but in no event
shall such plans, practices, policies and programs provide the
Executive with incentive opportunities, savings opportunities and
retirement benefit opportunities, in each case, less favorable than
the most favorable of those provided by the Company for the
Executive under such plans, practices, policies and programs as in
effect at any time during the 120-day period immediately preceding
the Change of Control Date, except that the foregoing shall not be
construed to require the Company to provide stock options if the
Company does not maintain a stock option plan following the Change
of Control, and benefits may be reduced under a tax qualified plan
if substitute benefits are provided under a nonqualified
plan.
(iv) Welfare Benefit Plans. During
the Employment Period, the Executive and/or the Executive’s
family, as the case may be, shall be eligible for participation in
and shall receive all benefits under welfare benefit plans,
practices, policies and programs provided by the Company
(including, without limitation, medical, prescription, dental,
disability, salary continuance, employee life, group life,
accidental death and travel accident insurance plans and programs)
to the extent applicable generally to other peer
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executives of the Company, but in no event shall
such plans, practices, policies and programs provide the Executive
with benefits which are less favorable, in the aggregate, than the
most favorable of such plans, practices, policies and programs in
effect for the Executive at any time during the 120-day period
immediately preceding the Change of Control Date.
(v) Expenses. During the Employment
Period, the Executive shall be entitled to receive prompt
reimbursement for all reasonable expenses incurred by the Executive
in accordance with the policies, practices and procedures of the
Company in effect for the Executive at any time during the 120-day
period immediately preceding the Change of Control Date.
(vi) Fringe Benefits. During the
Employment Period, the Executive shall be entitled to fringe
benefits in accordance with the most favorable plans, practices,
programs and policies of the Company in effect for the Executive at
any time during the 120-day period immediately preceding the Change
of Control Date.
(vii) Office and Support Staff.
During the Employment Period, the Executive shall be entitled to an
office or offices of a size and with furnishings and other
appointments, and to personal secretarial and other assistance, at
least equal to those provided to the Executive by the Company at
any time during the 120-day period immediately preceding the Change
of Control Date.
(viii) Vacation. During the
Employment Period, the Executive shall be entitled to paid
vacations in accordance with the plans, policies, programs and
practices of the Company at least as favorable as those in effect
for the Executive at any time during the 120-day period immediately
preceding the Change of Control Date.
5. Termination of Employment
. (a) Disability. If the Company determines in good faith that
Disability of the Executive has occurred during the Employment
Period (pursuant to the definition of Disability set forth below),
it may give to the Executive written notice in accordance with
Section 11(b) of this Agreement of its intention to terminate
the Executive’s employment. In such event, the
Executive’s employment with the Company shall terminate
effective on the 30th day after receipt of such notice by the
Executive (the “Disability Effective Date”), provided
that, within the 30 days after such receipt, the Executive shall
not have returned to full-time performance of the Executive’s
duties. For purposes of this Agreement, “Disability”
shall mean the absence of the Executive from the Executive’s
duties with the Company on a full-time basis for 180 consecutive
days as a result of incapacity due to mental or physical illness
which is determined to be total and permanent by a physician
selected by the Company or its insurers and reasonably acceptable
to the Executive or the Executive’s legal
representative.
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(b) Cause. The Company may terminate
the Executive’s employment during the Employment Period for
Cause. For purposes of this Agreement, “Cause” shall
mean:
(i) the willful and continued
failure of the Executive to perform substantially the
Executive’s duties with the Company or one of its affiliates
(other than any such failure resulting from incapacity due to
physical or mental illness), after a written demand for substantial
performance is delivered to the Executive by the Board or the Chief
Executive Officer of the Company which specifically identifies the
manner in which the Board or Chief Executive Officer believes that
the Executive has not substantially performed the Executive’s
duties, or
(ii) the willful engaging by the
Executive in illegal conduct or gross misconduct which is
materially and demonstrably injurious to the Company.
For purposes of this provision, no
act or failure to act on the part of the Executive shall
b
