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EXHIBIT 10.1
BELL MICROPRODUCTS INC.
MANAGEMENT RETENTION AGREEMENT
Bell Microproducts Inc. entered into a
Management Retention Agreement in the
form attached hereto with the following
officers of the Company:
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<CAPTION>
Name of Officer Date
of Agreement
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------------------
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<C>
W. Donald Bell
August 7, 2005
James E. Illson August 14,
2005
Philip M. Roussey August 7, 2005
Robert J. Sturgeon August 7, 2005
Richard J. Jacquet August 7, 2005
Graeme Watt
September 11, 2005
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BELL MICROPRODUCTS, INC.
MANAGEMENT RETENTION AGREEMENT
This Management Retention Agreement (the
"Agreement") is made and entered into
by and between __________ (the "Employee")
and Bell Microproducts, Inc. (the
"Company"), effective as of the latest date
set forth by the signatures of the
parties hereto below (the "Effective
Date").
RECITALS
A. It is expected that the Company from
time to time will consider the
possibility of an acquisition by another
company or other change of control. The
Board of Directors of the Company (the
"Board") recognizes that such
consideration can be a distraction to the
Employee and can cause the Employee to
consider alternative employment
opportunities. 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
and objectivity of the Employee,
notwithstanding the possibility, threat or
occurrence of a Change of Control (as
defined below) of the Company.
B. The Board believes that it is in the
best interests of the Company and its
stockholders to provide the Employee with
an incentive to continue his
employment and to motivate the Employee to
maximize the value of the Company
upon a Change of Control for the benefit of
its stockholders.
C. The Board believes that it is imperative
to provide the Employee with certain
severance benefits upon Employee's
termination of employment following a Change
of Control which provides the Employee with
enhanced financial security and
provides incentive and encouragement to the
Employee to remain with the Company
notwithstanding the possibility of a Change
of Control.
D. Certain capitalized terms used in the
Agreement are defined in Section 4
below.
The parties hereto agree as follows:
1. Term of Agreement. The term of this
Agreement shall initially be three years
following the Effective Date ("Initial
Term"), and shall automatically be
extended for successive one year periods
("Extended Term") unless terminated,
amended or modified by the Company prior to
the end of any Extended Term. Upon
the termination of employment, for any
reason, this agreement is automatically
terminated.
2. At-Will Employment. The Company and the
Employee acknowledge that the
Employee's employment is and shall continue
to be at-will, as defined under
applicable law. If the Employee's
employment terminates for any reason,
including (without limitation) any
termination prior to a Change of Control, the
Employee shall not be entitled to any
payments, benefits, damages, awards or
compensation other than as provided by this
Agreement, or as may otherwise be
available in accordance with the Company's
written employee plans or pursuant to
other written agreements with the
Company.
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3. Severance Benefits.
(a) Termination
Following A Change of Control. If the Employee's employment
terminates at any time within twelve (12)
months following a Change of Control,
then, subject to Section 4, the Employee
shall be entitled to receive the
following severance benefits:
(i) Involuntary Termination. If the Employee's employment is
the
result of Involuntary Termination other
than for Cause,then the Employee shall
receive the following severance benefits
from the Company:
(1) Severance Payment. A cash payment in an amount equal to one
hundred percent (100%) of the Employee's
Base Salary.
(2) Continued Employee Benefits. One hundred percent (100%)
Company-paid health, dental and life
insurance coverage at the same level of
coverage as was provided to such employee
immediately prior to the Change of
Control (the "Company-Paid Coverage") under
the Company's plans. Such coverage
shall be provided under either (at the
Company's discretion) (i) the Company's
plans, or (ii) no less favorable plans or
arrangements secured by the Company.
If such coverage included the Employee's
dependents immediately prior to the
Change of Control, such dependents shall
also be covered at Company expense.
Company-Paid Coverage shall continue until
the earlier of (i) one year from the
date of the Change of Control, or (ii) the
date that the Employee and his
dependents become covered under another
employer's group health, dental or life
insurance plans that provide Employee and
his dependents with comparable
benefits and levels of coverage. For
purposes of Title X of the Consolidated
Budget Reconciliation Act of 1985
("COBRA"), the date of the "qualifying event"
for Employee and his dependents shall be
the date upon which the Company-Paid
Coverage terminates.
(3) Accelerated Vesting. One hundred percent (100%) of the
unvested portion of any stock option,
restricted stock and restricted stock
units held by the Employee shall
automatically be accelerated in full so as to
become completely vested.
(b) Timing of
Severance Payments. Any severance payment to which Employee
is entitled under Section 4(a)(i) shall be
paid by the Company to the Employee
(or to the Employee's successors in
interest, pursuant to Section 7(b)) in cash
and in full, not later than thirty (30)
calendar days following the Termination
Date. In no event shall payment be made
later than two and one-half (2 1/2)
months following the calendar year in which
the Termination Date occurs.
(c) Voluntary
Resignation; Termination For Cause. If the Employee's
employment terminates by reason of the
Employee's voluntary resignation (and is
not an Involuntary Termination), or if the
Employee is terminated for Cause,
then the Employee shall not be entitled to
receive severance or other benefits
except for those (if any) as may then be
established under the Company's then
existing written employee plans or pursuant
to other written agreements with the
Company.
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(d) Disability;
Death. If the Company terminates the Employee's employment
as a result of the Employee's Disability,
or such Employee's employment is
terminated due to the death of the
Employee, then the Employee shall not be
entitled to receive severance or other
benefits except for those (if any) as may
then be established under the Company's
then existing written employee plans or
pursuant to other written agreements with
the Company.
(e) Termination
Apart from Change of Control. In the event the Employee's
employment is terminated for any reason,
either prior to the occurrence of a
Change of Control or after the twelve
(12)-month period following a Change of
Control, then the Employee shall be
entitled to receive severance and any other
benefits only as may then be established
under the Company's existing severance
and benefits plans and practices or
pursuant to other agreements with the
Company.
4. Limitation on Payments. In the event
that the severance and other benefits
provided for in this Agreement or otherwise
payable to the Employee (i)
constitute "parachute payments" within the
meaning of Section 280G of the
Internal Revenue Code of 1986, as amended
(the "Code") and (ii) but for this
Section 4, would be subject to the excise
tax imposed by Section 4999 of the
Code, then the Employee's severance
benefits under Section 3(a)(i) shall be
reduced as to such lesser extent as would
result in no portion of such severance
benefits being subject to excise tax under
Section 4999 of the Code. Unless the
Company and the Employee otherwise agree in
writing, any determination required
under this Section 4 shall be made in
writing by the Company's independent
public accountants immediately prior to
Change of Control (the "Accountants"),
whose determination shall be conclusive and
binding upon the Employee and the
Company for all purposes. For purposes of
making the calculations required by
this Section 4, the Accountants may make
reasonable assumptions and
approximations concerning applicable taxes
and may rely on reasonable, good
faith
