EXECUTIVE RETENTION AGREEMENT
AGREEMENT, dated as of March 17, 1994, by and between Joseph M. Morena
("Executive"), residing at 30 Coventry Road, Mendham, New Jersey 07945, and
Air & Water Technologies Corporation, a Delaware corporation (the "Company").
W I T N E S E T H:
WHEREAS, Executive is a skilled and dedicated employee who has important
management responsibilities and talents which benefit the Company and the
Company desires to ensure that it will continue to have the benefit of
Executive's services, and Executive desires to continue to be employed by the
Company;
WHEREAS, the Company has determined that Executive's ability to perform
Executive's responsibilities and utilize Executive's talents for the benefit
of the Company, and the Company's ability to retain Executive as a valued
employee, will be significantly enhanced if Executive is provided with fair
and reasonable protection from the risks of a Change of Control of the Company;
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants,
understandings, and agreements herein contained, the parties hereby agree as
follows:
1. General Definitions.
As used in this Agreement:
(a) "Board" means the Board of Directors of the Company.
(b) "Change of Control" means and includes the occurrence of any one
or more of the following:
(i) Continuing Directors no longer constitute at least
two-thirds of the Directors constituting the Board;
(ii) Any person or group of persons (as defined in Rule 13d-5
under the Exchange Act) becomes the beneficial owner,
directly or indirectly, of 25% or more of the Company's
then outstanding Common Stock or 25% or more of the voting
power of the Company's then outstanding securities entitled
generally to vote for the election of Directors;
(iii) The approval by the Company's stockholders of the merger
or consolidation of the Company with any other Entity, the
sale of all or substantially all of the assets of the
Company, or the liquidation or dissolution of the Company,
unless, in the case of a merger or consolidation, the
Continuing Directors in office immediately prior to the
merger or consolidation will constitute at least
two-thirds of the directors constituting the board of
directors of the surviving Entity of the merger or
consolidation and any parent (as that term is defined in
Rule 12b-2 under the Exchange Act) of that Entity; or
(iv) At least two-thirds of the Continuing Directors in office
immediately prior to any other action taken or proposed to
be taken by the Company's stockholders or by the Board
determines that such action constitutes, or that the
proposed action, if taken, would constitute, a Change of
Control of the Company and the action is taken.
(c) "Claim" or "Claims" means and includes one or more charges,
complaints, claims, grievances (including grievances filed
pursuant to a collective bargaining agreement), liabilities,
obligations, promises, covenants, agreements, controversies,
damages, injuries, actions, causes of action, suits, rights,
demands, deficiencies, levies, assessments, attachments,
executions, judgments, awards, recoveries, costs, losses,
debts, and expenses (including attorneys' fees and costs
actually incurred) of any kind or nature whatsoever, whether
known or unknown, suspected or unsuspected, contingent or not
contingent, liquidated or unliquidated.
(d) "Common Stock" means the Class A Common Stock of the Company.
(e) "Companies" means and includes the Company and all of its
affiliated Entities, including, but not limited to, parent and
subsidiary companies (whether wholly or partially owned and
whether direct or indirect), partnerships, and joint ventures.
(f) "Confidential Information" means and includes, without limitation,
business and proprietary information and technology, trade
secrets, patented processes, research and development data,
know-how, methods of doing business, and technical information of
the Companies; financial information not previously recorded in
public releases or filings; information regarding costs, profits,
markets, sales, products, market studies and forecasts, pricing
policies, key personnel, other business affairs and methods,
customers and customer prospects, business plans, competitive
analyses, and prospects and opportunities (such as possible
expansions or contractions of business operations) which have been
discussed or considered by the Companies' management; the
substance of agreements with customers and others, marketing and
dealership arrangements, servicing and training programs and
arrangements, and customer lists; and information concerning
operational strengths or weaknesses of the Companies' operating
units, all to the extent not previously revealed to the public or
to the trade by the Companies' management.
(g) "Continuing Director" means any person who either (i) is a
Director on the date of this Agreement or (ii) was designated as a
Continuing Director by a majority of the Continuing Directors.
(h) "Director" means a member of the Board.
(i) "Entity" or "Entities" means and includes one or more
organizations of any kind or nature whatsoever, including, without
limitation, corporations, companies, partnerships, joint ventures,
sole proprietorships, and divisions.
(j) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
2. Employment.
The Company hereby employs Executive and Executive hereby accepts such
employment for the term set forth in Paragraph 4 below, subject to
and in accordance with all of the terms and conditions of this
Agreement. Executive shall initially hold the position of Treasurer
of the Company and shall report to the Company's President; provided,
however, that the President, with the approval of the Company's Chief
Executive Officer, may change Executive's title and Executive's
responsibilities in the best interests of the Company and its
organizational development.
3. Duties and Responsibilities.
(a) Executive shall perform such duties and functions for the
Companies as are customarily performed by the Treasurer, or such
other duties or functions as the Company's President, with the
approval of the Company's Chief Executive Officer, shall assign
Executive from time to time in the best interest of the Company to
maximize its growth and development. In the performance of his
duties, Executive shall comply with the policies and procedures of
the Company (presently in effect or as may be reasonably modified
or established hereafter) and be subject to the direction of the
Chief Executive Officer, the President, and the Board.
(b) Executive agrees to devote his entire normal working time,
attention, and energies to the performance of his duties.
Executive shall not directly or indirectly, alone or as a member
of any partnership, or as an officer, director, employee, or agent
of any Entity, be actively engaged in or concerned with any other
duties or pursuits (whether or not for gain, profit, or other
pecuniary advantage) which interfere with the performance of his
duties hereunder, or which may be inimical to or contrary to the
best interests of the Company. Nothing in this subparagraph (b)
shall be construed as preventing Executive from investing
Executive's personal assets in any way that does not either
require the rendering of services by Executive to or on behalf of
the Entities in which the investments are made or result in any
other conflict of Executive's interest or time.
(c) Executive shall use his best efforts, skills, and abilities to
promote the Company's best interests.
4. Term.
(a) Except as provided in subparagraph (b) immediately below,
Executive's employment under this Agreement shall commence on the
date of the occurrence of a Change of Control and shall continue
for a period of two (2) years from and after such date (the
"Initial Term"), subject, however, to prior termination as
provided in Paragraphs 7 and 8 of this Agreement. This Agreement
may be renewed or extended upon such terms and conditions as the
parties shall mutually agree to in a written instrument signed by
each of the parties hereto, but neither party hereto shall be
under any obligation to renew this Agreement.
(b) Executive's employment under this Agreement will not commence on
the date of the occurrence of a Change of Control if on the day
immediately prior to the Change of Control Executive is no longer
employed by the Company, unless Executive's employment by the
Company is terminated prior to the Change of Control at the request
of the individual or individuals or Entity or Entities acquiring
control of the Company.
5. Compensation.
During the Initial Term of Executive's employment under this Agreement,
Executive shall be paid by the Company an annual salary of at least
$160,000.00. The salary paid to Executive may be reviewed by the Board
and may be increased at the sole and unreviewable discretion of the
Board, which shall take into account the earnings and overall
productivity of the Company, available resources, the performance of
Executive, the cost of living, and such other factors as it deems
relevant. The Board shall have no obligation to make any adjustments in
the salary of Executive. The salary to be paid to Executive under this
Agreement shall be payable in equal monthly installments in accordance
with the Company's customary payroll practices.
6. Other Benefits.
(a) During the Initial Term of Executive's employment under this
Agreement, Executive shall be entitled to such vacations, and to
participate in any other fringe benefits provided by the Company
to its key employees (including any bonus, profit sharing,
pension, and health insurance plans in accordance with and subject
to the terms of such plans), as may be determined from time to
time by the Board.
(b) During the Initial Term of Executive's employment under this
Agreement, there shall be established an Incentive Bonus Program
for Fiscal Years 1994 and 1995. In each such fiscal year,
Executive shall be eligible to earn up to $30,000.00 in bonuses,
calculated as follows:
(i) if Executive meets or exceeds the fiscal-year new orders
target for Executive's Operating Group, as set forth in
the approved business plan, Executive shall earn
$10,000.00;
(ii) if Executive meets or exceeds the fiscal-year contribution
margin target for Executive's Operating Group, as set
forth in the approved business plan, Executive shall earn
$10,000.00; and
(iii) if Executive meets or exceeds the fiscal-year cash flow
target for Executive's Operating Group, as set forth in
the approved business plan, Executive shall earn
$10,000.00.
Any Incentive Bonus earned during a fiscal year will be paid
during the first half of the following fiscal year and is subject
to reduction in accordance with subparagraph (c) immediately
below. The three targets applicable to Executive for Fiscal Year
1994 are set forth in Exhibit A to this Agreement. The three
targets applicable to Executive for Fiscal Year 1995 will be
established by the President of the Company, with the approval of
the Chief Executive Officer of the Company, after completion of
the Fiscal Year 1995 business plan and submission of the business
plan to the Board, and the President shall provide Executive a
written statement, in a form similar to Exhibit A, of the Fiscal
Year 1995 targets.
(c) If Executive is entitled to receive compensation under the
Company's Fiscal Year 1994 or 1995 Management Incentive Plan (or
such similar plan by whatever name it shall be known as), the
Incentive Bonus that Executive may be eligible for under
subparagraph (b) immediately above in Fiscal Year 1994 or 1995
shall be reduced as follows:
(i) if the actual total compensation payable to Executive
under the Management Incentive Plan is less than or equal
to thirty (30) percent of Executive's annual salary, then
Executive shall receive one hundred (100) percent of the
total Incentive Bonus earned in accordance with
subparagraph (b) immediately above;
(ii) if the actual total compensation payable to Executive
under the management Incentive Plan is greater than thirty
(30) percent but less than forty (40) percent of
Executive's annual salary, then Executive shall receive
only two-thirds of the total Incentive Bonus earned in
accordance with subparagraph (b) immediately above; or
(iii) if the actual total compensation payable to Executive
under the Management Incentive Plan is equal to or greater
than forty (40) percent of Executive's annual salary, then
Executive shall receive only one-third of the total
Incentive Bonus earned in accordance with subparagraph (b)
immediately above.
7. Termination of Employment by the Company for Death, Dis-ability, or
Justifiable Cause, or by Executive Without Good Reason, or Upon
Expiration of the Initial Term .
(a) The Company shall have the right to terminate the Executive's
employment under this Agreement upon the occurrence any one or
more of the following events:
(i) the death of Executive (in which case said employment
terminates immediately upon death);
(ii) the "disability" of Executive (as hereinafter defined); or
(iii) the Board determines in its sole and unreview-able
discretion (acting reasonably and in good faith) that
"justifiable cause" (as hereinafter defined) exists for
the termination of Executive's employment.
Executive shall have the right to terminate Executive's employment
under this Agreement without "good reason" (as defined in
Paragraph 8 below) upon sixty (60) days' prior written notice to
the President of the Company. No such termination by Executive
shall be effective unless that notice has been given.
Except as provided in subparagraph (b) immediately below, upon
termination of the employment of Executive under any of the
circumstances set forth in this subparagraph (a), Executive's
entitlement to further compensation or other benefits under
Paragraphs 5 and 6 of this Agreement shall immediately cease.
(b) For the purposes of this Agreement, the term "disability" shall
mean the inability of Executive, due to illness, accident, or any
other physical or mental incapacity, to perform his duties or
fulfill his obligations under this Agreement in a normal manner for
a period of any three (3) consecutive months or for a total of six
(6) months (whether or not consecutive) in any twelve (12) month
period during the Initial Term of this Agreement, it being
understood that, notwithstanding any such inability to perform his
duties, Executive shall be entitled to receive his compensation as
provided herein until the termination of his employment for
disability. The Company shall provide Executive ten days' prior
written notice of any determination by the Board that Executive is
disabled.
(c) For purposes of this Agreement, "justifiable cause" for
termination by the Company of Executive's employment shall means
any one or more of the following:
(i) any intentional breach by Executive of the performance of
any of his duties pursuant to this Agreement;
(ii) any intentional or negligent disclosure by Executive to
any person or Entity (other than the Companies) and other
than in the ordinary course of business of any Confidential
Information of the Companies;
(iii) any knowing violation or reckless disregard by Executive
of any law, governmental regulation, or judicial decree
which has caused substantial injury to the Companies,
financial or otherwise;
(iv) Executive's interference with or
endeavor to entice away from the Companies any client or
customer, or solicitation of employment of any of the
Companies' officers, directors, employees, or agents;
(v) Executive's conviction of a felony, as evidenced by a
binding and final judgment, order, or decree of a court of
competent jurisdiction, in effect after exhaustion or
lapse of all rights of appeal;
(vi) the commission by Executive of any act of fraud, or
material act of malfeasance, disloyalty, or breach of
trust against the Companies;
(vii) any attempt by Executive to secure any personal profit
(other than authorized compensation paid to Executive by
the Company) or convert any corporate opportunity to his
benefit in connection with the business of the Companies;
(viii) any failure by Executive to devote his entire normal
working time to the affairs of the Companies;
(ix) any activities of Executive that are determined to be
inimical to or contrary to the best interests of the
Companies; or
(x) the conduct or involvement by Executive in any business
other than the businesses of the Companies.
The Company shall provide Executive ten (10) days' prior written
notice of termination for justifiable cause; provided, however,
that the Company shall not be required to furnish any such prior
written notice in the event that the Board reasonably determines
in its sole and unreviewable discretion that immediate termination
of Executive without such prior written notice is necessary to
protect the best interests of the Companies. The written notice
shall set forth in reasonable detail the facts and circumstances
that are the basis for the termination for justifiable cause.
(d) If Executive is still employed under this Agreement at the end of
the Initial Term of this Agreement and if the parties hereto have
failed to reach a written agreement (signed by each of the parties
hereto) as to the continuation of Executive's employment,
Executive's employment under this Agreement will automatically
terminate upon expiration of the Initial Term. In such case:
(i) Executive's entitlement to further compensation or other
benefits under Paragraphs 5 and 6 of this Agreement shall
immediately cease upon expiration of the Initial Term; and
(ii) such termination shall be deemed a triggering event
entitling Executive to severance pay under the Company's
severance pay policy, but in no event shall the severance
pay due and payable to Executive be less than a total of
six (6) weeks' salary; provided, however, that Executive
shall not be entitled to any severance pay if (A)
Executive is provided by the Company, at least sixty (60)
days prior to the expiration of the Initial Term, a
written offer to renew this Agreement for at least an
additional one (1) year and Executive does not accept in
writing that offer at least thirty (30) days prior to the
expiration of the Initial Term, or (B) Executive remains
employed by any of the Companies.
8. Termination of Employment Under Other Circumstances.
(a) If (i) the Company terminates Executive's employment under this
Agreement other than for death, "disability", or "justifiable
cause", or Executive terminates Executive's employment under this
Agreement for "good reason" (as hereinafter defined), and (ii)
Executive does not remain employed by any of the Companies,
Executive shall:
(i) receive from the Company, within two (2) business days
after the termination, an amount in cash equal to the sum
of:
(A) all salary due and payable to Executive as of the
date of termination;
(B) pay for all accrued, but unused, vacation and sick
days through the date of termination;
(C) all salary that would have been due and payable to
Executive over the remaining period of the Initial
Term of this Agreement if Executive's employment had
not been terminated, based on Executive's annual
salary in effect at the date of termination. By way
of illustration, if Executive's annual salary at the
date of termination was $200,000.00 and the
termination occurred at the end of the seventh (7th)
month of the Initial Term, Executive would be
entitled to receive 17/24 x $400,000.00, or
$283,333.33; and
(D) all severance pay due and payable to Executive under
the Company's severance pay policy, but in no event
less than a total of six (6) weeks' salary, it being
understood that a termination under this
subparagraph (a), whether by the Company or
Executive, shall be deemed a triggering event
entitling Executive to severance pay under the
Company's severance pay policy;
(ii) receive from the Company all other benefits which
executive employees of the Company normally receive when
their employment is terminated by the Company without
"justifiable cause", which in no event shall be less than
the benefits such executive employees would have received
had their terminations occurred on the day immediately
preceding the Change of Control; and
(iii) with respect to any stock options for shares of the
Company's stock that Executive has been or may be
hereafter awarded, and notwithstanding the terms of the
Long-Term Incentive Compensation Plans under which these
options were or may be hereafter granted, be entitled to
fully exercise said stock options at any time up to and
including the ninetieth day after the expiration of the
remaining period of the Initial Term of this Agreement.
(b) For purposes of this Agreement, "good reason" for Executive to
terminate Executive's employment under this Agreement shall mean
any one or more of the following:
(i) both (A) without Executive's prior written consent, (1)
the assignment by the Company to Executive of duties and
responsibilities that are not at least substantially
equivalent to Executive's duties and responsibilities with
the Company immediately prior to the date of the Change of
Control, except in connection with the termination of
Executive's employment under this Agreement pursuant to
Paragraph 7 of this Agreement, or (2) the failure by the
Company to continue Executive in a position that is at
least substantially equivalent to the position held by
Executive with the Company immediately prior to the date
of the Change of Control, except in connection with the
termination of Executive's employment under this Agreement
pursuant to Paragraph 7 of this Agreement, and (B) the
continuance thereof for a period of twenty (20) days after
written notice thereof to the Company from Executive;
(ii) a failure by the Company to pay, or a reduction by the
Company of, the annual salary required to be paid to
Executive under Paragraph 5 of this Agreement;
(iii) a failure by the Company to pay any Incentive Bonus
required to be paid to Executive under Paragraph 6 of this
Agreement;
(iv) a failure by the Company to provide Executive with (A) the
opportunity to participate, on terms no less favorable
than those in effect for other executives holding a
similar position, in all of the Company's benefit and
executive compensation plans and programs or their
equivalent or (B) all other fringe benefits, or their
equivalent, from time to time in effect for the benefit of
other executives holding a similar position;
(v) without Executive's prior written consent, (A) the
relocation by the Company of the principal place of
Executive's employment to a location that is more than 100
miles from Executive's principal place of employment
immediately prior to the date of the Change of Control or
(B) the imposition by the Company of travel requirements
on Executive which are not substantially consistent with
the travel requirements applicable to Executive
immediately prior to the date of the Change of Control; or
(vi) any breach of Paragraph 15 of this Agreement by the
Company.
(c) If the Company terminates Executive's employment under this
Agreement other than for death, "disability", or "justifiable
cause", the Company shall provide Executive at least ten (10)
days' prior written notice of that termination, and no such
termination shall be effective unless that notice has been given.
The notice shall set forth in reasonable detail the facts and
circumstances that are the basis for the termination.
(d) At least sixty (60) days prior to the termination by Executive of
Executive's employment under this Agreement for "good reason",
Executive shall provide the President of the Company with written
notice of Executive's intention to terminate Executive's
employment, and no such termination shall be effective unless that
notice has been given. The notice shall set forth in reasonable
detail the facts and circumstances that are the basis for the
termination.
(e) If Executive's employment by the Company is terminated prior to a
Change of Control at the request of the individual or individuals
or Entity or Entities acquiring control of the Company, the
provisions of this Paragraph 8 shall apply as if a Change of
Control had occurred just prior to the date of termination.
9. No Mitigation.
Executive shall not be required to mitigate damages or the amount of any
payment provided for under this Agreement by seeking other employment or
otherwise, and payments and benefits due Executive under Paragraph 8(a)
of this Agreement shall not be subject to offset in respect of any
Claims which the Company has or may have against Executive. Without
limiting the generality of the foregoing, no payment otherwise required
under this Agreement shall be reduced because of any payment received by
Executive in connection with other employment of or other services
rendered by Executive after the date of termination of Executive's
employment under this Agreement.
10. Inventions, Discoveries, Etc.
(a) Executive shall promptly and fully disclose to the Company (with all
necessary detail for a complete understanding of the same) all
developments, know-how, discoveries, inventions, improvements,
concepts, ideas, writings, formulae, processes, and methods (whether
copyrightable, patentable, or otherwise) made, received, conceived,
acquired, or written by Executive (whether or not at the request of
or upon the suggestion of the Company) during the period of his
employment with any of the Companies, solely or jointly with others
(whether or not during working hours), in connection with or relating
to any activities of the Companies or any of their customers known
to him as a consequence of his employment (collectively referred to
as the "Subject Matter").
(b) Executive hereby assigns and transfers, and agrees to assign and
transfer, to the Company, all his right, title, and interest in and
to the Subject Matter. Executive further agrees to deliver to the
Company any and all drawings, notes, specifications, and data
relating to the Subject Matter and to execute, acknowledge, and
deliver all such further papers, including applications for
copyrights, patents, and similar protected ownership rights, as may
be necessary to obtain copyrights, patents, and similar protected
ownership rights with respect to the Subject Matter in any and all
countries and to vest title to any such copyrights, patents, and
similar protected ownership rights in the Company. Executive shall
assist the Company in obtaining such copyrights, patents, or similar
protected ownership rights during the period of his employment with
any of the Companies and any time thereafter and agrees to assist
the Company and to testify in its behalf in any prosecution or
litigation involving any of the Subject Matter during the period of
his employment with any of the Companies, and at any time
thereafter, in accordance with the provisions of subparagraph (c)
immediately below.
(c) At any time subsequent to the termination of Executive's employment
with any of the Companies or the expiration or termination of this
Agreement, if the Company requests in writing that Executive assist
the Company with respect to obtaining any patents, copyrights, or
similar protected ownership rights, or that Executive assist the
Company or testify in its behalf in connection with any prosecution
or litigation relating to the Subject Matter, the Company shall
reimburse Executive for Executive's reasonable out-of-pocket
expenses in connection with such assistance or testimony. In the
event the Company shall request Executive's assistance or testimony
as set forth hereunder, the Company agrees to use its best efforts to
assure that such assistance or testimony will neither require a
major or unreasonable portion of Executive's time nor substantially
interfere with his then current employment or business activities.
11. Non-Disclosure of Confidential Information.
(a) Executive shall not during his employment with any of the Companies
(nor at any time following termination of such employment or
expiration or termination of this Agreement), directly or
indirectly, intentionally or negligently disclose to or permit to be
known by any person or Entity any Confidential Information acquired
by him during the course of or in connection with his employment by
any of the Companies relating to (i) the Companies, (ii) the
officers, directors, employees, or agents of the Companies, (iii)
any client or customer of the Companies, or (iv) any Entity owned or
controlled, directly or indirectly, by any of the foregoing, or in
which any of the foregoing has a beneficial interest.
(b) All Confidential Information, regardless of how recorded, relating
to the Companies shall be the exclusive property of the Companies,
and Executive shall use his best efforts to prevent any publication
or disclosure thereof. Upon termination of Executive's employment
with any of the Companies or the expiration or termination of this
Agreement, all documents, records, reports, writings, and other
similar documents containing Confidential Information (including any
and all copies thereof) then in Executive's possession or control
shall be returned and left with the Company.
12. Right to Injunctive and Other Relief.
Executive recognizes that the services to be rendered by him to any of
the Companies are of special, unique, unusual, extraordinary, and
intellectual character, involving skill of the highest order, and that
such services are of special and particular value, the loss of which
cannot be adequately compensated for in damages. Executive further
agrees and declares that, because of his important role with the
Companies to date, clients' or customers' association of Executive with
the Companies, and the personal relationships Executive has with many of
such clients or customers, Executive's services to the Companies are
unique and extraordinary. In the event of a breach of any provision of
Paragraph 10 or 11 of this Agreement by Executive, the Companies shall
be entitled to injunctive relief and any other legal or equitable
remedies from a court of competent jurisdiction. Executive acknowledges
and agrees that any such breach will cause irreparable injury to the
Companies and that money damages will not provide an adequate remedy to
the Companies. In any action for injunctive relief, Executive shall not
be entitled to interpose a defense that the Companies have an adequate
remedy in a court of law. Executive agrees that the Companies may
recover by appropriate action the amount of the actual damages caused
the Companies by any failure, refusal, or neglect of Executive to
perform his agreements, representations, and warranties contained in
this Agreement. The remedies provided in this Agreement shall be deemed
cumulative and the exercise of one shall not preclude the exercise of
any other remedy at law or in equity for the same event or any other
event.
13. No Conflicting Agreements.
Executive represents and warrants that he is not a party to any
agreement, contract, or understanding, whether of employment or
otherwise, which would in any way restrict or prohibit him from
undertaking or performing his employment and other obligations in
accordance with the terms and conditions of this Agreement. Executive
further agrees to indemnify and hold harmless the Companies and their
past and present officers, directors, employees, agents, owners,
stockholders, representatives, and attorneys from and against and in
respect of any and all Claims alleging that (a) Executive is so
restricted or prohibited or (b) the Companies have committed a wrongful
act in negotiating with, and employing the services of, Executive.
14. Notices and Calendar Days.
All notices, requests, demands, and other communications provided for by
this Agreement shall be in writing and shall be personally delivered or
mailed (by registered or certified mail, return receipt requested,
postage prepaid) to the address of the party to whom intended as
specified below or to such different address as such party may have
fixed by a notice sent in accordance with this Paragraph.
(a) If to the Company, at:
Air & Water Technologies Corporation
P.O. Box 1500
Somerville, NJ 08876
Attention: President
with a copy to: General Counsel
(b) If to Executive, at:
30 Coventry Road
Mendham, NJ 07945
Any such notices shall be effective upon receipt, if personally
delivered, or three business days after mailing, if mailed.
Unless otherwise expressly provided, all references in this Agreement to
"days" mean "calendar days".
15. Assignability and Binding Effect.
(a) This Agreement shall inure to the benefit of and shall be binding
upon the heirs, executors, administrators, successors, and legal
representatives of Executive, and shall inure to the benefit of
and be binding upon the Company and its successors, assigns, and
legal representatives, but the obligations of Executive may not be
delegated and Executive may not assign, transfer, pledge,
encumber, hypothecate, or otherwise dispose of this Agreement, or
any of his rights under this Agreement, and any such attempted
delegation or disposition shall be null and void and without
effect. This Agreement shall also inure to the benefit of the
Companies and the Other Defendants (as defined in Paragraph 19
below) and their respective heirs, executors, administrators,
successors, assigns, and legal representatives.
(b) If the Company shall be merged into or consolidated with another
Entity, the provisions of this Agreement shall be binding upon and
inure to the benefit of the Entity surviving the merger or
resulting from the consolidation. The Company shall require any
successor, whether direct or indirect, by purchase, merger,
consolidation, or otherwise, to all or substantially all of the
business or assets of the Company, by agreement in form and
substance satisfactory to Executive, expressly to assume and agree
to perform this Agreement in the same manner and to the same
extent that the Company would have been required to perform this
Agreement if no succession had taken place. The provisions of
this Paragraph 15 shall continue to apply to each subsequent
employer of Executive bound by this Agreement in the event of any
merger, consolidation, or transfer of all or substantially all of
the business or assets of that subsequent employer.
16. Complete Understanding.
This Agreement constitutes the complete understanding between the
parties with respect to the employment of Executive hereunder, and no
statement, representation, warranty or covenant has been made by either
party with respect thereto except as expressly set forth herein. This
Agreement shall not be altered, modified, amended, or terminated except
by written instrument signed by each of the parties hereto.
17. Governing Law.
This Agreement and all provisions hereof shall be governed by and
construed in accordance with the laws of the State of New Jersey.
18. Severability.
Should any part, term, or provision of this Agreement be declared or be
determined by any court or tribunal of competent jurisdiction to be
illegal, invalid, or unenforceable, the legality, validity, and
enforceability of the remaining parts, terms, or provisions shall not be
affected thereby, and said illegal, unenforceable, or invalid part,
term, or provision shall be deemed not to be a part of this Agreement.
19. Arbitration.
(a) Except as provided in subparagraph (b) immediately below, any and
all Claims arising out of or relating to (i) this Agreement, (ii)
any breach of any provision of this Agreement, (iii) Executive's
employment at any time with any of the Companies, and/or (iv) the
termination of Executive's employment with any of the Companies
shall be settled by arbitration. Such arbitration proceeding
shall be conducted pursuant to the Employment Dispute Resolution
Rules of the American Arbitration Association ("AAA") then in
effect, by a single arbitrator, and shall be held in Somerset
County, New Jersey. The arbitrator shall not have the power to
award punitive damages. The cost of the arbitration proceeding
and the reasonable costs and attorneys' fees of the prevailing
party shall be paid by the non-prevailing party, with the dollar
amount of these costs and fees to be fixed by the arbitrator. The
judgment upon the award rendered by the arbitrator may be entered
in any court having competent jurisdiction thereof.
(b) Nothing in subparagraph (a) immediately above shall be construed
or interpreted to preclude the Companies from filing suit in a
court of competent jurisdiction in order to enforce their rights
and remedies under Paragraphs 10, 11 and/or 12 of this Agreement.
In any such suit, the court is empowered to and shall resolve any
dispute as to whether the Claims asserted by any of the Companies
are within the scope of Paragraphs 10, 11, and/or 12 of this
Agreement, and the court shall not refer such dispute to
arbitration under subparagraph (a) immediately above.
(c) With respect to the Claims of Executive that are within the scope
of subparagraph (a) above, if Executive has the same, similar, or
related Claims against any of the Companies' employee benefit
plans, trusts, committees, or boards or against any past or
present officers, directors, employees, agents, owners,
stockholders, trustees, fiduciaries, administrators, sponsors,
representatives, or attorneys of the Companies or the Companies'
employee benefit plans, trusts, committees, or boards
(collectively referred to as the "Other Defendants"), and if
Executive seeks to litigate such Claims against the Other
Defendants in a civil action or any other proceeding (including
before an administrative agency), Executive agrees that any or all
of said Other Defendants may compel Executive to arbitrate his
Claims against them pursuant to the terms of this Paragraph 19.
(d) The arbitrator selected by the parties pursuant to the AAA rules
shall have expertise in private industry employee relations and
shall hear and determine the case promptly. The burden of
persuasion shall at all times be upon the party seeking relief.
(e) In the event Executive files suit in a court of competent
jurisdiction and asserts that certain Claims are not subject to
arbitration under this Paragraph 19 because of the limitation on
the power of the arbitrator to award punitive damages (the
"Limitation"), the parties agree that they will request the court
to resolve that legal issue on an expedited basis, and if the
court rules in favor of Executive on the Limitation issue, the
parties agree as follows:
(i) the arbitration shall proceed as if this Paragraph 19 did
not contain such Limitation;
(ii) the parties will request the court to enter judgment in
favor of Executive on the Limitation issue, at which time
the Company may appeal that ruling;
(iii) in the event the arbitrator determines that Executive is
entitled to punitive damages, the punitive damages aspect
of the arbitrator's award will be stayed pending the
exhaustion or lapse of all rights of appeal of the Company
under subparagraph (e)(ii) immediately above; and
(iv) in the event an appellate court rules in favor of the
Company on the Limitation issue, the arbitrator shall
vacate the award of punitive damages.
The procedures set forth in this subparagraph (e) shall also apply
in the event Executive seeks relief in some other tribunal, such
as an administrative agency, and the Company files a civil action
to compel arbitration.
20. Waiver.
It is agreed that a waiver by either party of a breach of any provision
of this Agreement shall neither operate nor be construed as a waiver of
any subsequent breach hereof, or as a waiver of a breach of any other
provision.
21. Survival.
All representations and warranties herein shall survive any termination
of Executive's employment or termination or expiration of this
Agreement, and the termination of Executive's employment or the
termination or expiration of this Agreement shall not affect the
enforceability of Paragraphs 10, 11, 12, 13, and 19 of this Agreement,
which Paragraphs shall survive the termination or expiration of this
Agreement or the termination of Executive's employment.
22. Other Documents.
The parties agree to execute and deliver all such further instruments
and take such other and further action as may be reasonably necessary or
appropriate to carry out the provisions of this Agreement.
23. Paragraph Headings.
The paragraph headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or
interpretations of this Agreement.
IN WITNESS WHEREOF, the parties hereto set their hands as of the day and year
first above written.
AIR & WATER TECHNOLOGIES CORPORATION
By /s/ Arthur L. Glenn
---------------------------------
Witness:/s/ Linda M. Brady
----------------------------
/s/ Joseph M. Morena
------------------------------------
Joseph M. Morena
Witness:/s/ Douglas A. Satzger
----------------------------
EXHIBIT A
EXECUTIVE RETENTION AGREEMENT
BETWEEN
JOSEPH M. MORENA
AND
AIR & WATER TECHNOLOGIES CORPORATION
For Fiscal Year 1994, the approved business plan targets for purposes of
Paragraph 6 of the Agreement are as follows:
1. New Orders $
2. Contribution Margin $
3. Cash Flow $