CHANGE IN CONTROL AGREEMENT
AGREEMENT by and between MARSHALL INDUSTRIES, a California corporation,
(the "Company") and GORDON S. MARSHALL (the "Executive"), dated as of this _____
day of ______________, 199__.
WHEREAS, the Executive currently serves as Chairman of the Board of
Directors of the Company ("the Board");
WHEREAS, the Board has determined that it is in the best interests of the
Company and its shareholders to assure that the Company will have the continued
dedication of the Executive, notwithstanding the possibility of a change in
control of the Company;
WHEREAS, the Board wishes to diminish the distraction of the Executive by
virtue of any pending or threatened change in 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 in control; and
WHEREAS, the Board wishes to provide the Executive with compensation
arrangements upon a change in control which satisfy the expectations of the
Executive and which are competitive with those of other corporations.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
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1. TERM OF AGREEMENT.
(a) The term of this Agreement shall commence on the date of its
execution and shall terminate on December 31, 1998. Subject to
Subsection (b), on January 1, 1999, and on each January 1
thereafter, the term of this Agreement shall automatically be
extended for one additional year, unless not later than the
preceding July 1 both parties shall have agreed in writing not to
extend the term of this Agreement.
(b) If a Change in Control occurs during the original term of this
Agreement or any extension thereof under Subsection (a), the term
of this Agreement shall be automatically extended for a 24-month
period commencing with the Change in Control Date. At the end of
such 24-month period, this Agreement shall terminate.
(c) Notwithstanding anything to the contrary in this Section 1, this
Agreement shall terminate --
(1) on the date of the termination of the Executive's employment
with the Company for any reason before the Change in Control
Date, or
(2) on the Executive's Date of Termination on or after the Change
in Control Date if the Executive's employment with the Company
is terminated (A) by the Company for Cause or by reason of
Disability,
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(B) by reason of the Executive's death, or (C) by the Executive
without Good Reason.
2. CERTAIN DEFINITIONS. The following words and phrases, when used in
this Agreement, shall have the following meanings, unless otherwise
clearly required by the context.
(a) "AGREEMENT" shall mean this Change in Control Agreement.
(b) "BOARD" shall mean the Board of Directors of the Company.
(c) "CAUSE" shall mean:
(1) the willful and continued failure of the Executive to perform
substantially the Executive's duties with the Company or its
affiliates (for reasons other than the Executive's Disability),
after written notification is delivered to the Executive
specifying the manner in which the Board believes that the
Executive has not substantially performed the Executive's
duties, if the Executive does not cure such failure within 90
days of receiving such written notification; or
(2) the willful engaging by the Executive in criminal conduct or
gross misconduct which is materially and demonstrably injurious
to the Company.
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For purposes of this Subsection (c), no act or failure to act, on
the part of the Executive, shall be considered "willful" unless it
is done, or not done, by the Executive in bad faith or without
reasonable belief that the Executive's action or failure to act was
in the best interests of the Company. Any act, or failure to act,
pursuant to a resolution duly adopted by the Board or based upon
the advice of counsel for the Company shall be conclusively
presumed to be done, or not done, by the Executive in good faith
and in the best interests of the Company. The termination of
employment of the Executive shall not be deemed to be for Cause
unless and until there shall have been delivered to the Executive a
copy of a resolution, duly adopted by the affirmative vote of not
less than three-fourths of the group consisting of the outside
directors of the Company, at a meeting of the Board called and held
for such purpose (after reasonable notice is provided to the
Executive and the Executive is given an opportunity, together with
his counsel, to be heard before the Board), finding that, in the
good faith opinion of this portion of the Board, the Executive is
guilty of the conduct or misconduct described in Paragraph (1) or
(2), and specifying the particulars thereof in detail.
(d) "CHANGE IN CONTROL" shall mean:
(1) the acquisition by any individual, entity, or group (within the
meaning of Section 13(d) or 14(d)(2) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act")) (a "Person") of
beneficial
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ownership (within the meaning of Rule 13d-3 promulgated under
the Exchange Act) of 30 percent or more of either:
(A) the then outstanding shares of common stock of the Company
(the "Outstanding Company Common Stock"), or
(B) the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the
election of directors (the "Outstanding Company Voting
Securities");
provided, however, that any of the preceding events shall not
constitute a Change in Control unless the conditions of
Paragraph (2) shall also be satisfied within six months of any
of the preceding events; and provided, further, that for
purposes of this Paragraph (1), the following acquisitions
shall not constitute a Change in Control:
(C) any acquisition directly from the Company (including,
without limitation, a secondary offering of securities by
the Company);
(D) any acquisition by the Company (including, without
limitation, a repurchase or redemption of Company
securities by the Company);
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(E) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Company or any
corporation controlled by the Company; or
(F) any acquisition by any corporation pursuant to a
transaction which complies with Subparagraphs (A), (B), and
(C) of Paragraph (3) of this Subsection (d);
(2) the failure of individuals who, as of the date hereof,
constitute the Board (the "Incumbent Board") for any reason to
constitute at least a majority of the Board; provided, however,
that any individual becoming a member of the Board subsequent
to the date hereof whose election, or nomination for election
by the Company's shareholders, has been approved by a vote of
at least a majority of the members then comprising the
Incumbent Board shall be considered as though such individual
were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office
occurs as a result of an actual or threatened election contest
with respect to the election or removal of members or other
actual or threatened solicitation of proxies or consents by or
on behalf of a Person other than the Board;
(3) approval by the shareholders of the Company of a
reorganization, merger, consolidation, or sale or other
disposition of all or
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substantially all of the assets of the Company (a "Business
Combination"), in each case, unless, following such Business
Combination --
(A) all or substantially all of the individuals and entities
who were the beneficial owners, respectively, of the
Outstanding Company Common Stock and Outstanding Company
Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more
than 70 percent of, respectively, the then outstanding
shares of common stock and the combined voting power of the
then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be,
of the corporation resulting from such Business Combination
(including, without limitation, a corporation which as a
result of such transaction owns the Company or all or
substantially all of the Company's assets either directly
or through one or more subsidiaries) in substantially the
same proportions as their ownership, immediately prior to
such Business Combination, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities, as
the case may be;
(B) no Person (excluding any employee benefit plan (or related
trust) of the Company or such corporation resulting from
such
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Business Combination) beneficially owns, directly or
indirectly, 30 percent or more of, respectively, the then
outstanding shares of common stock of the corporation
resulting from such Business Combination or the combined
voting power of the then outstanding voting securities of
such corporation except to the extent that such ownership
existed prior to the Business Combination; and
(C) at least a majority of the members of the board of
directors of the corporation resulting from such Business
Combination were members of the Incumbent Board at the time
of the execution of the initial agreement, or of the action
of the Board, providing for such Business Combination; or
(4) approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company.
(e) "CHANGE IN CONTROL DATE" shall mean the first date on which a
Change in Control occurs. Notwithstanding any provision in this
Agreement to the contrary, if a Change in Control occurs and if the
Executive's employment with the Company terminates prior to the
date on which the Change in Control actually occurs, and if it is
reasonably demonstrated by the Executive that such termination --
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(1) was at the request of a third party who has taken steps
reasonably calculated to effect a Change in Control, or
(2) otherwise arose in connection with or anticipation of a Change
in Control,
for all purposes of this Agreement the Change in Control Date
shall mean the date immediately before the date of such
termination of employment.
(f) "CHANGE IN CONTROL PERIOD" shall mean the 24-month period beginning
on the Change in Control Date.
(g) "CODE" shall mean the Internal Revenue Code of 1986, as amended,
and all regulatory guidance promulgated thereunder.
(h) "COMPANY" shall mean Marshall Industries.
(i) "COMPENSATION" shall mean the Executive's earned income, wages,
salaries, fees for professional services, and other amounts
received or deferred for personal services actually rendered in the
course of employment with the Company or its affiliates.
Compensation shall include, without limitation, commissions,
compensation for services on the basis of a percentage of profits,
bonuses, director fees, amounts voluntarily deferred by the
Executive pursuant to a plan of deferred compensation, and any
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contributions by the Executive to or under a Code Section 125
cafeteria plan or any other employee benefit plan not specified
above. Amounts deferred or contributed by the Executive pursuant
to a qualified or nonqualified deferred compensation plan, Code
Section 125 cafeteria plan, or any other employee benefit plan
shall be deemed Compensation in the year in which the deferral or
contribution is made rather than in the year any amounts are
received by the Executive under these plans. Bonuses and other
performance-based pay shall be deemed Compensation in the year for
which such pay is earned by the Executive rather than in the year
in which payment is made to the Executive.
(j) "DATE OF TERMINATION" shall mean:
(1) if the Executive's employment is terminated by the Company for
Cause, or by the Executive for Good Reason, the date of receipt
of a written notice of termination, or any later date specified
therein;
(2) if the Executive's employment is terminated by the Company
other than for Cause or by reason of Disability, the date on
which the Company notifies the Executive of such termination;
or
(3) if the Executive's employment is terminated by reason of death
or Disability, the date of death or 15 days after the date of
determination by the Company (under Subsection (j)) of
Disability.
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(k) "DISABILITY" shall mean an incapacity, due to physical injury
or illness or mental illness, rendering the Executive unable to
perform his duties with the Company on a full-time basis for a
period of at least six consecutive calendar months. In the
case of a dispute between the Executive and the Company, the
determination of Disability shall be made by a doctor
acceptable to both the Executive and the Company. Nothing in
this Agreement shall prevent or limit the Executive from any
benefits to which the Executive is, or may become, entitled
under any short- or long-term disability program sponsored by
the Company or any of its affiliates.
(l) "EXECUTIVE" shall mean Gordon S. Marshall.
(m) "GOOD REASON" shall mean:
(1) 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 of the date of this Agreement,
or any other action by the Company which results in a
diminution in such position, authority, duties, or
responsibilities, excluding for this purpose an isolated,
insubstantial, or inadvertent action not taken in bad faith and
which is remedied by the Company promptly after receipt of
notice thereof given by the Executive;
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(2) the Company's requiring the Executive to be based at any office
or location more than 30 miles from the Company's corporate
headquarters as of the day before the Change in Control Date or
the Company's requiring the Executive to travel on Company
business to a substantially greater extent than required
immediately prior to the Change in Control Date;
(3) any material reduction in the Executive's total annual cash
compensation from the Company and its affiliates (including,
without limitation, base salary, bonus, and incentive plan
payments) without the consent of the Executive;
(4) any material shift in the composition of the Executive's total
annual compensation from the Company and its affiliates, from
base salary to bonus or incentive plan payments or from cash to
non-cash compensation, without the consent of the Executive;
(5) any purported termination by the Company of the Executive's
employment other than as expressly permitted by this Agreement;
or
(6) any failure by the Company to comply with and satisfy Section
12(c) of this Agreement.
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3. OBLIGATIONS OF THE COMPANY UPON TERMINATION.
(a) OTHER THAN FOR CAUSE OR DISABILITY. If, during the Change in
Control Period, the Company terminates the Executive's employment
other than for Cause or Disability, the Company shall be obligated
to pay the Executive the compensation equivalency under Subsection
(a) of Section 4 and to provide the benefits described in Section
5.
(b) GOOD REASON. If, during the Change in Control Period, the
Executive terminates employment with the Company for Good Reason,
the Company shall be obligated to pay the Executive the
compensation equivalency under Subsection (a) of Section 4 and to
provide the benefits described in Section 5.
(c) DEATH. If, during the Change in Control Period, the Executive's
employment is terminated by reason of the Executive's death, this
Agreement shall terminate without further obligation to the
Executive's legal representatives under this Agreement.
(d) BY THE COMPANY FOR CAUSE OR BECAUSE OF DISABILITY, OR BY THE
EXECUTIVE WITHOUT GOOD REASON. If, during the Change in Control
Period, the Company terminates the Executive's employment for Cause
or because of Disability, or if, during the Change in Control
Period, the Executive terminates employment without Good Reason,
this Agreement shall terminate without further obligation to the
Executive.
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4. COMPENSATION EQUIVALENCY. The following amount shall be paid by the
Company to the Executive to the extent required under, and in
accordance with, the provisions of Sections 3, 7, 8, and 9.
(a) AMOUNT OF PAYMENT. The Executive shall receive a cash payment
equal to the product of five times the greater of (1) the
Executive's Compensation for the last full calendar year ending on
or before the Executive's Date of Termination, or (2) $750,000.
(b) TIMING OF PAYMENT. The amount determined above shall be payable as
soon as practicable after the Executive's Date of Termination, in a
single lump-sum cash payment.
5. BENEFITS. The following benefits shall be provided by the Company for
the Executive and (to the extent applicable) his immediate family, to
the extent required, and in accordance with, the provisions of Sections
3, 7, 8, and 9.
(a) For three years after the Executive's Date of Termination, or such
longer period as may be provided under the terms of the appropriate
plan, program, practice, or policy, the Company shall continue
benefits to the Executive and/or the Executive's immediate family
at a level at least equal to that which would have been provided
for him and/or them in accordance with the plans, programs,
practices, and policies described in
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Subsection (b) if the Executive's employment had not terminated or,
if more favorable to the Executive, as in effect generally at any
time thereafter with respect to other senior executives of the
Company and its affiliates and their families. Notwithstanding the
foregoing, if the Executive becomes reemployed with another
employer and is eligible to receive medical or other welfare
benefits under another employer-provided plan, or if the Executive
breaches any of the convenants listed in Section 8, the benefits
provided under this Subsection (a) shall be immediately terminated.
(b) The benefits described herein shall be all benefits under any
welfare benefit plans, arrangements, or programs provided by the
Company and its affiliates (including, without limitation, medical,
prescription drugs, dental, disability, employee and dependent
life, group life, accidental death, and travel accident insurance
plans and programs) to the extent applicable generally to other
executives of the Company and its affiliates, other than severance
benefits, to the extent not triggered by the Executive's
termination of employment with the Company.
6. ACCELERATION OF STOCK OPTION VESTING. Upon a Change in Control, the
Company shall cause the vesting of any stock options with regard to
stock of the Company or its affiliates held by the Executive to be
accelerated to the Change in Control Date. The Executive shall be
entitled to give notice of exercise of all such options for 30 days
after the Change in Control Date or such longer period permitted under
the original documents granting such options.
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7. CONTINGENT LIMITATION ON AMOUNTS.
(a) Notwithstanding any other provisions of this Agreement or any other
agreement, plan, or arrangement (except as provided in the
following paragraph of this Subsection (a)), if any payment or
benefit received or to be received by the Executive (under the
terms of this Agreement, or any other plan, arrangement, or
agreement with the Company, or any other plan, arrangement, or
agreement with any person whose actions result in a Change in
Control or any person affiliated with the Company or any such
person)(all such payments and benefits being hereinafter called
"Total Payments") would be subject (in whole or in part) to taxes
imposed by Code Section 4999, the portion of the Total Payments
payable under this Agreement shall be reduced as herein provided.
The Total Payments payable under this Agreement shall be reduced to
the extent necessary so that no portion of the Total Payments shall
be subject to the parachute excise tax (the "Excise Tax") imposed
by Code Section 4999 (after taking into account any reduction in
the Total Payments provided by reason of Code Section 280G in any
other plan, arrangement, or agreement) but only if the amount
determined under Paragraph (1) is greater than the amount
determined under Paragraph (2).
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(1) The amount determined hereunder shall be the net amount of such
Total Payments, as so reduced (and after deduction of the net
amount of Federal, state, and local income taxes on such
reduced Total Payments computed at the Executive's highest
marginal tax rate).
(2) The amount determined hereunder shall be the excess of --
(A) the net amount of such Total Payments, without reduction
(but after deduction of the net amount of Federal, state,
and local income taxes on such Total Payments computed at
the Executive's highest marginal tax rate), over
(B) the amount of Excise Tax to which the Executive would be
subject in respect of such Total Payments.
Any reduction of the Total Payments shall be made under one of the
two alternative methods described in Subsection (b).
(b) If the Total Payments all become payable at approximately the same
time,
(1) the payments under Section 4 shall first be reduced (if
necessary, to zero);
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(2) the other portions of the Total Payments shall next be reduced
(if necessary, to zero); and
(3) the acceleration of vesting of awards under stock options shall
be reduced as necessary.
If the Total Payments do not become due and payable at
approximately the same time, the respective Total Payments shall be
paid in full in the order in which they become payable until any
portion thereof would not be deductible, and such portion (and any
subsequent portions) of the Total Payments shall be reduced to
zero. In such case, the Company shall make every reasonable effort
to make such payments in the order that results in the most
favorable tax treatment and financial results for the Executive.
(c) For purposes of determining whether and the extent to which the
Total Payments would be subject to the Excise Tax,
(1) no portion of the Total Payments the receipt or enjoyment of
which the Executive shall have effectively waived in writing
prior to the date of termination shall be taken into account;
(2) no portion of the Total Payments shall be taken into account
which in the opinion of Arthur Andersen LLP (or suitable
experts selected by the Board) does not constitute a "parachute
payment" within the
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meaning of Code Section 280G(b)(2), including by reason of Code
Section 280G(b)(4)(A);
(3) in calculating the Excise Tax, the payments shall be reduced
only to the extent necessary so that the Total Payments in
their entirety constitute reasonable compensation for services
actually rendered within the meaning of Code Section 280G(b)(4)
or are otherwise not subject to disallowance as deductions
because of Code Section 280G, in the opinion of Arthur Andersen
LLP (or suitable experts selected by the Board); and
(4) the value of any non-cash benefit or any deferred payment or
benefit included in the Total Payments shall be determined by
Arthur Andersen LLP (or suitable experts selected by the Board)
in accordance with the principles of Code Section 280G(d)(3)
and (4).
The Company shall provide the Executive with the calculation of the
foregoing amounts and any supporting materials as are reasonably
necessary for the Executive to evaluate the calculations. All
calculations hereunder shall be performed by Arthur Andersen LLP (or
suitable experts selected by the Board).
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8. RESTRICTIVE COVENANTS.
(a) The Executive shall devote his full time, attention, and energies
to the business of the Company. The Executive shall not, during
the term of this Agreement, be engaged in any other activity which
interferes with the performance of his duties.
(b) During the term of this Agreement and the two-year period beginning
on the Executive's Date of Termination, the Executive shall not
engage directly or indirectly, either as an owner, principal,
shareholder, agent, proprietor, director, officer, employee, or
adviser of (inclusive of the direct or indirect holdings of his
spouse, child, or parent), or participate in the ownership,
management, operation, or control of, or have any other significant
financial interest in, any of the following businesses, their
affiliates, or any part thereof, or any successors or assigns (in
whole or in part) thereto:
(1) Arrow Electronics, Inc.;
(2) Avnet, Inc.;
(3) Bell Industries, Inc.;
(4) Wyle Electronics; or
(5) Pioneer-Standard Electronics, Inc.
(c) As part of the consideration for this Agreement, the Executive
shall not, at any time during the term of this Agreement or
thereafter, divulge to another
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person trade secrets or confidential information of the Company and
its affiliates including, but not limited to, the Company's unique
business methods, processes, operating techniques, and "know-how"
(all of which have been developed by the Company or its affiliates
through substantial effort and investment), profit and loss
results, market and supplier strategies, customer identity and
needs, information pertaining to employee effectiveness and
compensation, inventory strategy, product costs, gross margins, or
any other information relating to the affairs of the Company and
its affiliates that he may acquire during his employment with the
Company.
(d) The Executive shall not, at any time during the term of this
Agreement or the two-year period beginning on the Executive's Date
of Termination, solicit or induce any of the employees of the
Company or its affiliates to terminate their employment with their
employer.
9. REMEDIES.
(a) The Executive agrees that the provisions of Section 8 are
necessary for the protection of the Company and that any breach
thereof will cause the Company irreparable damage for which there
is no adequate remedy at law. The Executive consents to the
issuance of an injunction in favor of the Company as a matter of
right, enjoining the breach of any of the aforesaid covenants by
any court of competent jurisdiction.
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(b) Upon a breach by the Executive of any of the covenants listed in
Section 8, the Company's obligation to make any payments or provide
any benefits under Section 3 which have not yet been paid or
provided, or to allow the Executive to exercise any options the
vesting of which were accelerated under Section 6 but which remain
unexercised, shall cease and this Agreement shall cease without
further obligations to the Executive.
(c) Upon a breach by the Executive of any of the covenants listed in
Section 8, to the extent the Company shall have paid any of the
compensation equivalency described in Section 4, the Executive
shall pay to the Company, within 15 days of receipt of written
demand by the Company, the difference between the amounts
determined under Paragraphs (1) and (2).
(1) The amount determined under this Paragraph shall be 40 percent
of the amount the Executive received as a cash payment as
determined under Section 4(a).
(2) The amount determined under this Paragraph shall be the product
of 40 percent of the amount the Executive received as a cash
payment as determined in Section 4 and a fraction. The
numerator of this fraction shall be 730 less the number of days
that have elapsed from the Executive's Date of Termination
through the first date of the breach by
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the Executive of one or more of the covenants listed in
Section 8. The denominator of the fraction shall be 730.
(d) This Section 9 shall survive the termination of this Agreement.
The remedies described herein, including the Company's right to an
injunction, shall be cumulative and in addition to whatever other
remedies the Company may have under this Agreement or otherwise.
10. RIGHTS NOT EXCLUSIVE. Nothing in this Agreement shall prevent or limit
the Executive's continuing or future participation in any plan,
program, policy, or practice provided by the Company or any of its
affiliates for which the Executive may otherwise qualify. Subject to
Section 14(f), nothing herein shall limit or otherwise affect such
rights as the Executive may have under any contract or agreement with
the Company or any of its affiliates. Amounts which are vested
benefits or which the Executive is otherwise entitled to receive under
any plan, policy, practice, or program of, or any contract or agreement
with, the Company or any of its affiliates at or subsequent to the Date
of Termination shall be payable in accordance with such plan, policy,
practice, program, contract, or agreement except as explicitly modified
by this Agreement.
11. FULL SETTLEMENT; LEGAL FEES. The Company's obligation to make any
payments required under this Agreement and otherwise to perform its
obligations hereunder shall not be affected by any set-off,
counterclaim, recoupment, defense, or other claim, right, or action
which the Company may have against the
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Executive or others. 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 or benefits provided to the Executive under any of
the provisions of this Agreement; and, except as specifically provided
in Sections 5, 7, 8, and 9, such amounts or benefits shall not be
reduced whether or not the Executive obtains other employment.
12. SUCCESSORS.
(a) This Agreement is personal to the Executive and, without the prior
written consent of the Company, shall not be assignable by the
Executive, other than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be
enforceable by the Executive's legal representatives.
Notwithstanding the foregoing, the rights transferable, assignable,
or enforceable pursuant to this Subsection shall only relate to
benefits accrued and actually payable to the Executive before his
death. The provisions of this Subsection shall not be deemed to
create any additional rights or benefits.
(b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns.
(c) The Company shall require any successor (whether direct or
indirect, by purchase, merger, consolidation, or otherwise) to all
or substantially all of
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the business and/or assets of the Company to assume expressly and
agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such
succession had taken place. As used in this Agreement, "Company"
shall mean the Company as hereinbefore defined and any successor to
its business and/or assets as aforesaid which assumes and agrees to
perform this Agreement by operation of law, or otherwise.
13. ARBITRATION. Except for the Company's right to seek equitable relief
as provided herein, any controversy arising out of or relating to this
Agreement, or any written modification or extension thereof, including
any claim for damages, whether based on contract, tort, or any theory
of law, shall be settled by arbitration. Such arbitration shall take
place in Los Angeles, California, in accordance with the commercial
rules then applicable of the American Arbitration Association. The
arbitrator or arbitrators sitting in any such controversy shall have no
power to alter or modify any express provisions of this Agreement or
any written instrument modifying or extending this Agreement, or to
render any award which by its terms effects any such alteration or
modification. The parties consent to the jurisdiction of the Superior
Court of the State of California and of the U.S. District Court for the
Central District of California for all purposes in connection with
arbitration, including the entry of judgment on any award. The parties
consent that any process or notice of motion or other application to
any of said courts, and any paper in connection with arbitration, may
be served by certified mail return receipt requested or by personal
service or in such other
25
manner as may be permissible under the rules of the applicable court or
arbitration tribunal, provided a reasonable time for appearance is
allowed. The parties further agree that arbitration proceedings shall
be instituted within one year after the claimed breach shall have
occurred, and that any failure to institute arbitration proceedings
within such period shall constitute an absolute bar to the institution
of any administrative, court, or arbitration proceedings and a waiver
of all claims. The Company shall pay all of the Executive's reasonable
legal expenses and other reasonable costs in presenting the matter and
all reasonable costs of the arbitrator.
14. MISCELLANEOUS.
(a) This Agreement shall be governed by and construed in accordance
with the laws of the State of California, without reference to
principles of conflict of laws. The captions of this Agreement are
not part of the provisions hereof and shall have no force or
effect. This Agreement may not be amended or modified other than
by a written agreement executed by the parties hereto or their
respective successors and legal representatives.
(b) All notices and other communications hereunder shall be in writing
and shall be given by hand delivery to the other party or by
registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:
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If to the Executive: ______________________________________
______________________________________
______________________________________
If to the Company: ______________________________________
______________________________________
______________________________________
or to such other address as either party shall have furnished to
the other in writing in accordance herewith. Notices and
communications shall be effective when actually received by the
addressee.
(c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any
other provision of this Agreement.
(d) The Company may withhold from any amounts payable under this
Agreement such Federal, state, local, and foreign taxes as shall be
required to be withheld pursuant to any applicable law or
regulation.
(e) The Executive's or the Company's failure to insist upon compliance
with any provision of this Agreement or the failure to assert any
right that the Executive or the Company may have hereunder,
including without limitation the right of the Executive to
terminate employment for Good
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Reason and the right of the Company to any remedy under Section 9,
shall not be deemed to be a waiver of such provision or right or
any other provision or right of this Agreement.
(f) The Executive and the Company acknowledge that, except as may
otherwise be provided under any other written agreement between the
Executive and the Company, the employment of the Executive by the
Company is "at will." Prior to the Change in Control Date, the
Executive's employment may be terminated by either the Executive or
the Company at any time, in which case the Executive shall have no
further rights under this Agreement. From and after the Change in
Control Date, this Agreement shall supersede any other agreement
between the parties with respect to the subject matter hereof.
IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand and,
pursuant to the authorization from the Board, the Company has caused this
Agreement to be executed in its name on its behalf, all as of the day and
year first above written.
___________________________________
GORDON S. MARSHALL
MARSHALL INDUSTRIES
By ________________________________
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