Exhibit 10.17
TRANSITION
AGREEMENT
This Transition
Agreement (the “Agreement”) is being entered into this
day of May, 2004 (the
“Effective Date”) by and between [insert name] and
Colfax Corporation, its subsidiaries, and affiliate companies
(collectively, the “Company”).
1.
Except as otherwise provided herein, the term of this Agreement
will be from the Effective Date until one year following the
closing date of the sale (the “Closing Date”) of the
Colfax Power Transmission Group (the “Business”) of the
Company, unless earlier terminated as provided below.
2.
During the term of this Agreement, you will continue to devote your
entire business skill, time, and effort diligently to the affairs
of the Business and you will perform all such duties, and otherwise
conduct yourself, in a manner reasonably determined to promote the
best interests of the Company.
3.
Notwithstanding any other provision of this
Agreement, your eligibility to receive from the Company any
Severance Benefit under this Agreement is expressly contingent on
the sale of all of the Business (whether in one transaction or
several) or the sale of the business unit within the Business for
which you provide services to a Buyer (or Buyers) on or before
June 30, 2005. If neither all of the Business nor the
business unit within the Business for which you provide services is
sold on or before June 30, 2005, you shall not be eligible to
receive any Severance Benefit pursuant to this Agreement and this
Agreement shall terminate on July 1, 2005. For the
purposes of this Agreement, a sale shall not be deemed to occur
until the transaction closes.
4.
Severance Benefit Eligibility:
(a)
In addition to the requirements in Section 3 above, you will
be eligible for a Severance Benefit only if: you satisfy the
requirements of Sections 5 and 6 herein; and if during the
first year of your employment with the Buyer, your employment is
terminated by the Buyer other than for Cause or you voluntarily
resign for Good Reason.
(b)
If you are eligible for a Severance Benefit, it will be calculated
as set forth in Schedule A and will be paid to you in the form
of salary continuation in accordance with the Company’s
regular payroll practices and procedures. The Severance
Benefit also includes the following: if you elect to continue
your health care and dental coverage through COBRA or any similar
state law and provided you continue to authorize the required
employee contributions for your share of the premiums, the Company
will continue to pay its share of your premiums (at the same level
of coverage as you have upon termination of employment) during the
period of salary continuation.
(c)
If payable, the Severance Benefit will not be included in
determining the amount of any benefits under any of the
Company’s qualified or nonqualified employee benefit plans in
which you may be a participant.
(d)
Any Severance Benefit will cease immediately upon your securing
employment after the end of your employment with the Company.
You agree that if you do
secure such employment
during the period in which are receiving Severance Benefit, you
shall immediately notify the Company.
For purposes of this
Agreement, the term “Cause” means: (i) your
conviction (including without limitation by plea of guilty or no
contest) of a felony or your conviction (including without
limitation by plea of guilty or no contest) of a misdemeanor crime
involving fraud, dishonesty, or moral turpitude; (ii) your
willful misconduct or negligence in the performance of your duties;
(iii) your breach of this Agreement or any other agreement
between you and the Company; or (iv) any breach of your
fiduciary duty or act of fraud, dishonesty, disloyalty, or
embezzlement by you.
For
purposes of this Agreement, the term “Good Reason”
means: (i) a material diminution in your job responsibilities;
(ii) a material reduction in your compensation or bonus
opportunities; or (iii) a change (without your consent) in
your principal location of employment that is more than 30 miles
from the current principal location of your employment.
5.
To
be eligible for a Severance Benefit, you must execute and deliver
to the Company a General Release of Claims (“General
Release”) in the form attached hereto as Exhibit 1 or in
such other form as the Company reasonably determines is
appropriate. You understand that you shall sign the General
Release no earlier than the first business day after the last day
of your employment.
6.
In further consideration for the benefits described in
Section 4 above, you agree to the following:
a.
Return of Property;
Intellectual Property Rights. Upon your termination of
employment for any reason with the Company or at any other time
requested by the Company, you will return all property owned by the
Company or containing information relating to the Company’s
business or customers, including files, documents, data and records
(whether on paper, tapes, disks, or in any other form, electronic
or otherwise), office equipment, credit cards, and employee
identification cards. You acknowledge that the Company is the
rightful owner of any programs, ideas, inventions, discoveries,
copyright material, or trademarks that you may have originated or
developed, or assisted in originating or developing, during your
period of employment with the Company, where any such origination
or development involved the use of Company time or resources, or
the exercise of your responsibilities for or on behalf of the
Company. You will at all times, both before and after termination
of employment, cooperate with the Company in executing and
delivering documents and taking any other actions that are
necessary or requested by the Company to assist the Company in
patenting, copyrighting, or registering any programs, ideas,
inventions, discoveries, copyright material, or trademarks, and to
vest title thereto in the Company.
b.
Proprietary and Confidential Information. You will at all times
both during and after your employment with the Company preserve the
confidentiality of all proprietary or confidential information and
trade secrets of the Company, except to the extent that disclosure
of such information is legally required, authorized in writing by
the Company, or necessary in the performance of your duties on
behalf of the Company. The phrase “proprietary or
confidential information” includes without limitation
information that has not been disclosed to the public or that has
been disclosed to the
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public wrongfully or in
breach of the disclosing party’s obligations to the Company
and that is treated as confidential within the business of the
Company, such as strategic or tactical business plans; financial
data; ideas, processes, methods, techniques, systems, patented or
copyrighted information, models, devices, programs, computer
software, or related information; documents relating to regulatory
matters and correspondence with governmental entities; information
concerning any past, pending, or threatened legal dispute; pricing
and cost data; reports and analyses of business prospects; business
transactions which are contemplated or planned; research data;
personnel information and data; identities or lists of or
information regarding users, purchasers, or customers of any of the
Company’s products or services; and other confidential
matters pertaining to or known by the Company, including
confidential information of a third party which you know or should
know the Company is bound to protect.
c.
Interference with Business Relations . During the period
of your employment with the Company except in accordance with your
duties and responsibilities on behalf of the Company, and for a
period ending 12 months following your termination of employment
from the Company for any reason, you, without the prior written
consent of the Company, will not directly or indirectly on behalf
of yourself or any other entity: (i) recruit, solicit,
or hire any employee of the Company (or any person employed by the
Company within six months of the recruitment, solicitation, or
hiring) for employment or for retention as a consultant or service
provider; (ii) solicit or induce, or in any manner attempt to
solicit or induce, any client, customer, or prospective client or
customer of the Company to cease being, or not to become, a
customer of the Company, or to divert any business of such customer
or prospective customer or client from the Company; or
(iii) otherwise interfere with, disrupt, or attempt to
interfere with or disrupt, the relationship, contractual or
otherwise, between the Company and any of its customers, clients,
prospective customers or clients, suppliers, consultants, or
employees.
d .
Other Agreements and
Policies. The obligations imposed on you by this
Section 6 are in addition to, and not in lieu of, any and all
other policies or agreements of the Company regarding the subject
matter of the foregoing obligations.
e.
You acknowledge that the Comp
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