Exhibit 10.1
Execution Copy
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE
EMPLOYMENT AGREEMENT (the “ Agreement ”)
is made and entered into as of May 26, 2005, by and among
Swift Foods Company, a Delaware corporation (together with its
successors and assigns permitted hereunder, the “
Company ”), Swift & Company, a Delaware
corporation and a wholly owned subsidiary of the Company (“
S&C ”) and Sam Rovit (the “
Executive ”).
WHEREAS, the
parties hereto deem it desirable for the Company to employ the
Executive on the terms and conditions set forth herein.
NOW, THEREFORE, IT
IS HEREBY AGREED AS FOLLOWS:
1. Employment Period . Subject to
Section 3, the Company hereby agrees to employ the Executive,
and the Executive hereby agrees to be employed by the Company, in
accordance with the terms and provisions of this Agreement, for the
period commencing on July 1, 2005 (the “ Effective
Date ”) and ending on the third anniversary of the
Effective Date (the “ Employment Period
”); provided, however, commencing on the third anniversary of
the Effective Date, and on each anniversary of such date occurring
thereafter, the Employment Period shall automatically be extended
for one additional year unless at least 12 months prior to
such date (but no more than 18 months prior to such date), the
Company or the Executive shall have given written notice that it or
he, as applicable, does not wish to extend this Agreement (a
“ Non-Renewal Notice ”). The term “
Employment Period ,” as utilized in this
Agreement, shall refer to the Employment Period as so automatically
extended.
2. Terms of Employment .
(a)
Position and Duties .
(i) During
the term of the Executive’s employment, the Executive shall
serve as the President and Chief Executive Officer of the Company
and, in so doing, shall report to the Board of Directors of the
Company (the “ Board ”). Executive shall
also serve as President and Chief Executive Officer of S&C. The
Executive shall have supervision and control over, and
responsibility for, such management and operational functions of
the Company currently assigned to such positions, and shall have
such other powers and duties (including holding officer positions
with the Company and one or more subsidiaries of the Company) as
may from time to time be prescribed by the Board and agreed to by
the Executive, so long as such powers and duties are reasonable and
customary for the president and chief executive officer of an
enterprise comparable to the Company.
(ii) During
the term of the Executive’s employment, and excluding any
periods of vacation and sick leave to which the Executive is
entitled, the Executive agrees to devote substantially all of his
business time 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, effectively and efficiently
such responsibilities. During the term of Executive’s
employment, it shall not be a violation of this Agreement for the
Executive to (1) serve on corporate, civic or charitable
boards or committees, (2) deliver lectures or fulfill speaking
engagements and (3) manage personal investments, so
long
as such activities do not
materially interfere with the performance of the Executive’s
responsibilities as an employee of the Company in accordance with
this Agreement.
(b)
Compensation .
(i)
Base Salary . During the term of the Executive’s
employment, the Executive shall receive an annual base salary
(“ Annual Base Salary ”) at least equal
to Seven Hundred Sixty One Thousand Two Hundred and Fifty Dollars
($761,250), which shall be paid by S&C in accordance with the
customary payroll practices of the Company and S&C. Commencing
on the first day (the “ First Date ”) of
the month in the month beginning after the first anniversary of the
Effective Date, and on each subsequent anniversary date of the
First Date as long as the Executive remains an employee of the
Company (the First Date and each subsequent anniversary of the
First Date being herein referred to as an “ Adjustment
Date ”), the Annual Base Salary of the Executive
shall be increased by an amount equal to five percent (5%) of the
then current Annual Base Salary or such greater amount as the Board
of Directors of the Company (the “ Board
”) in its discretion may determine appropriate. The result of
such increase to the then current Annual Base Salary shall
constitute the Executive’s Annual Base Salary commencing on
the Adjustment Date then at hand and continuing until the next
Adjustment Date. Any increase in Annual Base Salary shall not serve
to limit or reduce any other obligation to the Executive under this
Agreement. The term Annual Base Salary as utilized in this
Agreement shall refer to Annual Base Salary as so
increased.
(ii)
Bonuses . The Executive shall be eligible to receive an
annual performance bonus (a “ Bonus ”) in
accordance with the provisions of Exhibit A . For each
fiscal year of the Company, the Board shall approve a budget which
shall include, among other things, a target for the items set forth
on Exhibit A hereto for that year. A portion of the
Executive’s Bonus shall be based upon the Company’s
achievement of such targets in accordance with the guidelines set
forth on Exhibit A hereto. The Bonus shall be payable
on the first day of the first calendar month after the
determination of the Company’s EBITDA (as defined in
Exhibit A ).
(iii)
Incentive, Savings and Retirement Plans . During the term of
the Executive’s employment, the Executive shall be entitled
to participate in all incentive, savings and retirement plans,
practices, policies and programs applicable generally to other
executives of the Company (“ Investment Plans
”).
(iv)
Welfare Benefit Plans . During the term of the
Executive’s employment, 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 (“
Welfare Plans ”) 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 executives of the
Company.
(v)
Perquisites . During the term of the Executive’s
employment, the Executive shall be entitled to receive (in addition
to the benefits described above) such perquisites and fringe
benefits appertaining to his position in accordance with any
practice
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established by the Board.
Executive shall be furnished with all such facilities and services
suitable to his position and adequate for the performance of his
duties.
(vi)
Expenses . During the term of the Executive’s
employment, the Executive shall be entitled to receive prompt
reimbursement for all reasonable employment expenses incurred by
the Executive in accordance with the policies, practices and
procedures of the Company. In addition, the Company shall reimburse
the Executive (A) for his reasonable attorney’s fees
incurred in connection with the negotiation and execution of this
Agreement and, (B) in accordance with the policies of the
Company, for his reasonable expenses incurred in relocating
Executive and his family to the Denver, Colorado area. The
Executive may be required to commute on a weekly basis from his
current residence in the Chicago, Illinois area to the Denver,
Colorado area during an initial transition period that shall last
no longer than three (3) months and the Company shall fully
reimburse the Executive for such commuting expenses.
(vii)
Vacation and Holidays . During the term of the
Executive’s employment, the Executive shall be entitled to
four weeks of paid vacation time each year in addition to those
days designated as paid holidays in accordance with the plans,
policies, programs and practices of the Company for its executive
officers. Unused vacation time shall carry over to the next year.
Any unused vacation time shall be paid in a cash lump sum payment
promptly after the Date of Termination, pursuant to
Section 4(a)(i).
(viii)
Stock Options . In addition to any benefits the Executive
may receive pursuant to paragraph 2(b)(iii), as may be determined
appropriate by the Board, the Company may, from time to time, grant
Executive stock options (the “ Executive
Options ”) exercisable for shares of capital stock of
the Company and, subject to the terms of this Agreement, such
Executive Options shall have such terms and provisions as may be
determined appropriate by the Board. On the Effective Date, the
Company will grant Executive Options in accordance with the terms
of Exhibit B hereto under the Company’s 2002
Stock Option Plan.
(ix)
Share Purchase . The Executive shall have the one time right
to purchase up to 1,237,151 shares of common stock of the Company
for a purchase price of $1.01 per share for a period of
30 days following the Effective Date. Concurrently with the
purchase of any such shares the Executive agrees to execute a
joinder to that certain Stockholders Agreement dated as of
September 19, 2002 by and among the Company and certain of its
stockholders. Such joinder shall provide that, notwithstanding
anything else contained in the Stockholders Agreement to the
contrary, such shares shall be treated as Management Group Shares
(as defined in the Stockholders Agreement) for the purposes of the
Stockholders Agreement.
3. Termination of Employment .
(a)
Death or Disability . The Executive’s employment shall
terminate automatically upon the Executive’s death during the
Employment Period. If the Disability of the Executive has occurred
during the Employment Period (pursuant to the definition of
Disability set forth below), the Company may give to the Executive
written notice in accordance with Section 11(b) 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
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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
Executive’s inability to perform his duties and obligations
hereunder for a period of 180 consecutive days due to mental or
physical incapacity as determined by a physician selected by the
Company or its insurers and acceptable to the Executive or the
Executive’s legal representative (such agreement as to
acceptability not to be withheld unreasonably).
(b)
Cause . The Company may terminate the Executive’s
employment during the Employment Period for Cause or without Cause.
For purposes of this Agreement, “ Cause ”
shall mean (i) the Executive’s willful failure to perform his
obligations under Section 2(a) (other than as a result of physical
or mental incapacity) which constitutes a breach by the Executive
of his obligations and duties thereunder, as reasonably determined
by the Board, which is not remedied within 30 days after
receipt of the written notice from the Board provided for in the
next sentence specifying such breach and that has caused
demonstrable and serious economic injury to the Company,
(ii) commission by the Executive of an act of fraud upon, or
willful misconduct toward, the Company, (iii) a material
breach by the Executive of Section 6 or Section 9 that
has caused demonstrable and serious economic injury to the Company,
(iv) the conviction of the Executive of any felony (or a plea
of nolo contendere thereto) that involves financial
misconduct or moral turpitude or that has resulted in any adverse
publicity regarding the Executive or the Company or economic injury
to the Company; or (v) the willful failure of the Executive to
carry out, or comply with, in any material respect any directive of
the Board consistent with the terms of this Agreement, which is not
remedied within 30 days after receipt of the written notice
from the Board provided for in the next sentence and that has
caused demonstrable and serious economic injury to the Company.
Notwithstanding the foregoing, no act or omission shall constitute
“Cause” for purposes of this Agreement unless a
majority of the disinterested members of the Board (neither the
Executive nor members of his family being deemed disinterested for
this purpose) the Board provides Executive (x) written notice
clearly and fully describing the particular acts or omissions which
the Board reasonably believes in good faith constitutes
“Cause;” (y) an opportunity, within 30 days
following his receipt of such notice, to meet in person with the
Board to explain or defend the alleged acts or omissions relied
upon by the Board and, to the extent practicable, to cure such acts
or omissions; and (z) a copy of a resolution duly adopted by a
majority of disinterested members of the Board finding that in the
good faith opinion of the Board, Executive committed the alleged
acts or omissions and that they constitute grounds for Cause
hereunder. Further, no act or omission shall be considered willful
unless committed in bad faith or without a reasonable belief that
the act or omission was in the best interests of the Company. The
Executive shall have the right to contest a determination of Cause
by the Company by requesting arbitration in accordance with the
terms of Section 11(j) hereof.
For purposes of this Agreement,
“ without Cause ” shall mean a
termination by the Company of the Executive’s employment
during the Employment Period for any reason other than a
termination based upon Cause, death or Disability, including
pursuant to a Board Determination (as defined in
Section 4(b)).
(c)
Good Reason . The Executive’s employment may be
terminated during the Employment Period by the Executive for Good
Reason or without Good Reason; provided,
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however, that the Executive
agrees not to terminate his employment for Good Reason unless
(i) the Executive has given the Company at least
30 days’ prior written notice of his intent to terminate
his employment for Good Reason, which notice shall specify the
facts and circumstances constituting Good Reason, and (ii) the
Company has not remedied such facts and circumstances constituting
Good Reason within such 30-day period. For purposes of this
Agreement, “ Good Reason ” shall
mean:
(i) the
assignment to the Executive of any duties inconsistent in any
respect with the Executive’s position (including status,
offices, titles and reporting requirements), authority, duties or
responsibilities as contemplated by Section 2(a) or any other
action by the Company which results in a material diminution in
such position, authority, duties or responsibilities, excluding for
this purpose an isolated, insubstantial and inadvertent action not
taken in bad faith and which is remedied by the Company promptly
after receipt of notice thereof given by the Executive (without
limiting the foregoing, the Company and the Executive agree that
the delegation of the authority, duties or responsibilities of the
Executive to another person or persons, including any committee,
shall be deemed to be an action by the Company which results in a
material diminution in the Executive’s position, authority,
duties, or responsibilities as contemplated by Section 2(a)),
provided, however, that Good Reason may not be asserted by the
Executive under this clause (i) of Section 3(c) after a
Non-Renewal Notice has been given by either the Company or the
Executive;
(ii) any
termination or material reduction of a material benefit under any
Investment Plan or Welfare Plan in which the Executive participates
unless (1) there is substituted a comparable benefit that is
economically substantially equivalent to the terminated or reduced
benefit prior to such termination or reduction or (2) benefits
under such Investment Plan or Welfare Plan are terminated or
reduced with respect to all then serving senior executives of the
Company previously granted benefits thereunder;
(iii) any
failure by the Company to comply with any of the provisions of
Section 2(b), other than an isolated, insubstantial and
inadvertent failure not occurring in bad faith and which is
remedied by the Company promptly after receipt of notice thereof
given by the Executive;
(iv) any
failure by the Company to comply with and satisfy
Section 8(c), provided that such successor has received at
least ten days prior written notice from the Company or the
Executive of the requirements of Section 8(c);
(v) the
relocation or transfer of the Executive’s principal office to
a location more than 20 miles from the Company’s current
executive offices as such are maintained on the date hereof in the
city of Greeley, Colorado unless such other location is within 50
miles of the city of Denver, Colorado;
(vi) without
limiting the generality of the foregoing, any material breach by
the Company or any of its subsidiaries or other affiliates (as
defined below) of (1) this Agreement or (2) any other
agreement between the Executive and the Company or any such
subsidiary or other affiliate, which material breach is not
remedied by the Company promptly after receipt of notice thereof
given by the Executive; or
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(vii) the
Company has given the Executive a Non-Renewal Notice.
As
used in this Agreement, “ affiliate ”
means, with respect to a person, any other person controlling,
controlled by or under common control with the first person; the
term “ control ,” and correlative terms,
means the power, whether by contract, equity ownership or
otherwise, to direct the policies or management of a person; and
“ person ” means an individual,
partnership, corporation, limited liability company, trust or
unincorporated organization, or a government or agency or political
subdivision thereof.
(d)
Notice of Termination . Any termination by the Company for
Cause or without Cause, or by the Executive for Good Reason or
without Good Reason, shall be communicated by Notice of Termination
to the other party hereto given in accordance with
Section 11(b). For purposes of this Agreement, a “
Notice of Termination ” means a written notice
which (i) indicates the specific termination provision in this
Agreement relied upon, (ii) to the extent applicable, sets
forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of the Executive’s employment
under the provision so indicated and (iii) if the Date of
Termination (as defined below) is other than the date of receipt of
such notice, specifies the termination date (which date shall not
be more than 15 days after the giving of such notice). The
failure by the Executive or the Company to set forth in the Notice
of Termination any fact or circumstance which contributes to a
showing of Good Reason or Cause shall not waive any right of the
Executive or the Company hereunder or preclude the Executive or the
Company from asserting such fact or circumstance in enforcing the
Executive’s or the Company’s rights
hereunder.
(e)
Date of Termination . “ Date of
Termination ” means (i) if the Executive’s
employment is terminated by the Company for Cause, or by the
Executive for Good Reason or without Good Reason, the date of
receipt of the Notice of Termination or any later date specified
therein pursuant to Section 3(d), as the case may be,
(ii) if the Executive’s employment is terminated by the
Company other than for Cause, the date on which the Company
notifies the Executive of such termination or any later date
specified therein pursuant to Section 3(d), as the case may
be, (iii) if the Executive’s employment is terminated by
reason of death or Disability, the date of death of the Executive
or the Disability Effective Date, as the case may be, and
(iv) if the Executive’s employment terminates due to the
giving of a Non-Renewal Notice, the last day of the Employment
Period.
4. Obligations of the Company upon Termination
.
(a)
Good Reason; Other Than for Cause, Death or Disability . If,
during the Employment Period, the Company shall terminate the
Executive’s employment other than for either Cause or
Disability or the Executive shall terminate his employment for Good
Reason, and the termination of the Executive’s employment in
any case is not due to his death or Disability:
(i) The
Company shall pay to the Executive in a lump sum in cash within ten
days after the Date of Termination the aggregate of the following
amounts: (1) the sum of the Executive’s Annual Base
Salary through the Date of Termination to the extent not
theretofore paid and any compensation previously deferred by the
Executive (together with any accrued interest or earnings thereon)
and any accrued vacation pay (“ Accrued
Obligations ”); (2)
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an amount equal to two times the
Executive’s then current Annual Base Salary; (3) an
amount equal to the maximum annual Bonus (excluding any
“stretch” amounts as described on Exhibit A
) that the Executive could have earned for the year in which the
Date of Termination occurs prorated for the portion of such year
that the Executive is employed and based with respect to any
performance criteria on the Company’s performance through the
last day of the calendar month immediately prior to the month in
which the Date of Termination occurs relative to the
Company’s budget for such period; and (4) any amount
arising from Executive’s participation in, or benefits under,
any Investment Plans (“ Accrued Investments
”), which amounts shall be payable in accordance with the
terms and conditions of such Investment Plans.
(ii) Except
as otherwise provided in Section 4(e), the Executive (and
members of his family) shall be entitled to continue their
participation in the Company’s Welfare Plans for a period of
12 months from the Date of Termination. This period shall be
credited against any period for which the Executive and/or members
of his family are entitled to continuation coverage under Section
4980B of the Internal Revenue Code of 1986, as amended, and
Sections 601-609 of the Employee Retirement Income Security
Act of 1974, as amended.
(iii) Notwithstanding
the terms or conditions of any Executive Option or any other stock
option grants, stock appreciation right or similar agreements
between the Company and the Executive, the Executive shall vest, as
of the Date of Termination, in all rights under such agreements
(i.e., Executive Options that would otherwise vest after the Date
of Termination) and thereafter shall be permitted to exercise, in
accordance with the terms of the Executive Options, any and all
such rights until the earlier of (w) the date the Option would
otherwise expire in accordance with its terms, (x) if the Date
of Termination is prior to a Qualifying Public Offering (as defined
in that certain Stock Option Agreement of even date herewith
between the Company and Executive), the 270th day after a
Qualifying Public Offering, (y) if the Date of Termination is
after a Qualifying Public Offering, the 90th day after the Date of
Termination, or (z) the 90th day after the completion of a
merger, combination, share exchange or similar transaction
involving the Company pursuant to which the securities for which
the Option is then exercisable are listed on a national securities
exchange or the Nasdaq National Market System or any successor
thereto; provided, however, the provisions of this clause
(iii) of this Section 4(a) shall not apply to a termination of
the Executive’s employment during the Employment Period that
is made by the Company pursuant to a Board
Determination.
(b)
Board Determination . If the Executive’s employment is
terminated by the Company pursuant to a Board Determination during
the Employment Period, the Executive shall be entitled to receive
the benefits specified in Sections 4(a)(i) and 4(a)(ii) of
this Agreement. Further, notwithstanding the terms or conditions of
any Executive Option, stock appreciation rights or similar
agreement between the Executive and the Company, all unvested
Executive Options and unvested stock appreciation rights or similar
agreements shall be forfeited and the Executive shall not vest, as
of the Date of Termination or otherwise, in any rights under such
unvested Executive Options, stock appreciation rights or similar
agreements that are unvested immediately prior to the Date of
Termination, and thereafter shall be permitted to exercise, in
accordance with the terms of the Executive Options, only those
rights that were otherwise vested immediately prior to the Date of
Termination until the earlier of (w) the date the Option would
otherwise expire in accordance with its terms, (x) if the Date
of Termination is prior to a Qualifying Public Offering, the 270th
day after a Qualifying Public Offering, (y) if the Date
of
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Termination is after a Qualifying
Public Offering, the 90th day after the Date of Termination, or
(z) the 90th day after the completion of a merger,
combination, share exchange or similar transaction involving the
Company pursuant to which the securities for which this Option is
then exercisable are listed on a national securities exchange or
the Nasdaq National Market System or any successor thereto. For
purposes of this Agreement, a “ Board
Determination ” means a unanimous determination by
the Board (excluding the Executive) (which is evidenced by one or
more written resolutions of the Board to such effect), (i) to
terminate the Executive’s employment during the Employment
Period based upon the Board’s dissatisfaction with the manner
in which the Executive has performed his obligations and duties
under Section 2(a) and (ii) that Cause does not exist as a
basis for such termination.
(c)
Death or Disability . If the Executive’s employment is
terminated by reason of the Executive’s death or Disability
during the Employment Period, the Company shall pay to his legal
representatives (i) in a lump sum in cash within ten days
after the Date of Termination the aggregate of the following
amounts: (A) an amount equal to the Executive’s then
current Annual Base Salary; and (B) the Accrued Obligations;
and (ii) the Accrued Investments which shall be payable in
accordance with the terms and conditions of the Investment Plans.
In addition, the members of the Executive’s family shall be
entitled to continue their participation in the Company’s
Welfare Plans for a period of 12 months after the Date of
Termination. Further, notwithstanding the terms or conditions of
any Executive Option, stock appreciation right or similar
agreements between the Company and the Executive, the Executive
shall vest, as of the Date of Termination, in all rights under such
agreements (i.e., Executive Options that would otherwise vest after
the Date of Termination) and thereafter his legal representative
shall be permitted to exercise, in accordance with the terms of the
Executive Options, any and all such rights until the earlier of
(w) the date the Option would otherwise expire in accordance
with its terms, (x) if the Date of Termination is prior to a
Qualifying Public Offering, the 270th day after a Qualifying Public
Offering, (y) if the Date of Termination is after a Qualifying
Public Offering, the 90th day after the Date of Termination, or
(z) the 90th day after the completion of a merger,
combination, share exchange or similar transaction involving the
Company pursuant to which the securities for which this Option is
then exercisable are listed on a national securities exchange or
the Nasdaq National Market System or any successor thereto. The
Company shall have no further payment obligations to the Executive
or his legal representatives under this Agreement.
(d)
Cause; Other than for Good Reason . If the Executive’s
employment shall be terminated by the Company for Cause or by the
Executive without Good Reason during the Employment Period, the
Company shall have no further payment obligations to the Executive
other than for payment of Accrued Obligations, Accrued Investments
(which shall be payable in accordance with the terms and conditions
of the Investment Plans), and the continuance of benefits under the
Welfare Plans to the Date of Termination (or later to the extent
required by law). Further, notwithstanding the terms or conditions
of any Executive Option, stock appreciation rights or similar
agreement between the Executive and the Company, all unvested
Executive Options and unvested stock appreciation rights or similar
agreements shall be forfeited and the Executive shall not vest, as
of the Date of Termination or otherwise, in any rights under such
Executive Options, stock appreciation rights or similar agreements
that are unvested immediately prior to the Date of Termination and
thereafter shall be permitted to exercise, in accordance with the
terms of the Executive Options, only those rights that were
otherwise vested
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immediately prior to the Date of
Termination until the earlier of (w) the date the Option would
otherwise expire in accordance with its terms, (x) if the Date
of Termination is prior to a Qualifying Public Offering, the 270th
day after a Qualifying Public Offering, (y) if the Date of
Termination is after a Qualifying Public Offering, the 90th day
after the Date of Termination, or (z) the 90th day after the
completion of a merger, combination, share exchange or similar
transaction involving the Company pursuant to which the securities
for which this Option is then exercisable are listed on a national
securities exchange or the Nasdaq National Market System or any
successor thereto.
(e) If
pursuant to the terms and provisions of the Company’s Welfare
Plans the Executive (or members of his family) are not eligible to
participate in the Company’s Welfare Plans because the
Executive is no longer an employee of the Company, then the Company
may fulfill its obligations under Section 4(a)(ii), Section
4(b) or Section 4(c), as applicable, by either providing to
the Executive (or his legal representatives), or reimbursing the
Executive (or his legal representatives) for the costs of, benefits
substantially similar to the benefits provided by the Company to
its senior management under its Welfare Plans as such may from time
to time exist after the Date of Termination.
(f)
Breach for Early Termination . During the first
180 days of the Employment Period, it shall be a breach of
this Agreement for the Company to terminate the Executive’s
employment without Cause or for the Executive to terminate his
employment without Good Reason. In the event of any purported
termination in violation of this Section 4(e), the
non-terminating party shall be entitled to all damages and other
remedies available at law with respect to such breach.
(g)
Release . Notwithstanding the foregoing, the Executive is
entitled to receive the payments under Section 4(a)(i)(2) and
the benefits of Section 4(a)(iii) of this Agreement only in
exchange for his execution and non-revocation (and lapse of time
during which such revocation may occur) of a release in
substantially the same form as attached hereto as
Exhibit C .
5. Full Settlement, Mitigation . In no event
shall the Executive be obligated to seek other employment or take
any other action by way of mitigation of the amounts payable to the
Executive under any of the provisions of this Agreement and such
amounts shall not be reduced whether or not the Executive obtains
other employment. Except as expressly provided in
Section 4(e), neither the Executive nor the Company shall be
liable to the other party for any damages in addition to the
amounts payable under Section 4 arising out of the termination
of the Executive’s employment prior to the end of the
Employment Period; provided, however, that the Company shall be
entitled to seek damages for any breach of Sections 6, 7 or 9
or criminal misconduct.
6. Confidential Information .
(a) The
Executive acknowledges that the Company and their affiliates have
trade, business and financial secrets and other confidential and
proprietary information (collectively, the “
Confidential Information ”) of which Executive
will become aware during the Employment Period. As defined herein,
Confidential Information shall not include information
(i) that becomes generally available to the public other than
as a result of a disclosure
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by Executive, (ii) that is
rightfully available to Executive on a non-confidential basis from
a source other than the Company (provided such source was not bound
by a confidentiality agreement with the Company or otherwise
prohibited from transmitting the information to Executive by a
contractual, legal, or fiduciary obligation), or (iii) that is
required to be disclosed by the Executive pursuant to a subpoena or
court order, or pursuant to a requirement of a governmental agency
or law of the United States of America or a state thereof or any
governmental or political subdivision thereof; provided ,
however , that the Executive shall take all reasonable steps
to prohibit disclosure pursuant to subsection
(iii) above.
(b) The
Company shall, during the time that the Executive is employed by
the Company, disclose or entrust to the Executive, or provide the
Executive with access to, or place Executive in a position to
create or develop trade secrets or confidential information
belonging to the Company or its customers or clients; place the
Executive in a position to develop business goodwill belonging to
the Company; and disclose or entrust to the Executive business
opportunities to be developed for Company or its customers or
clients.
(c) The
Executive agrees (i) to hold the Confidential Information in
confidence and (ii) not to release such information to any
person (other than Company employees and other persons to whom the
Company has authorized the Executive to disclose such information
and then only to the extent that such Company employees and other
persons authorized by the Company have a need for such
knowledge).
(d) The
Executive further agrees not to use any Confidential Information
for the benefit of any person or entity other than the
Company.
(e) As
used in this Section 6, “ Company ”
shall include the Company and any of its direct or indirect
subsidiaries or affiliates.
7. Surrender of Materials Upon Termination .
Upon any termination of the Executive’s employment, the
Executive shall immediately re
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