Exhibit 10.14
APW LTD.
CHANGE IN CONTROL AGREEMENT
FOR
TODD ADAMS
This Agreement is made as of November 1, 2000 (the "Effective Date"),
between APW Ltd., a Bermuda corporation (the "Company"), and Todd Adams (the
"Executive").
WHEREAS, the Executive is a valued employee of the Company; and
WHEREAS, the Company desires to enter into this Change in Control Agreement
with the Executive to provide the Executive with contractual
assurances to induce the Executive to remain as an employee of the Company
notwithstanding the possibility, threat or occurrence of a Change in Control (as
defined below) of APW Ltd.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the Executive and the Company agree as follows:
1. Employment and Duties. The Company hereby employs Executive as
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Controller, with all powers and authority as are customary to this position, and
Executive hereby accepts employment with the Company in accordance with the
terms and conditions set forth herein. Executive shall have such executive
responsibilities as is customary with this position and as the Company's Board
of Directors or the President (as the case may be) shall from time to time
assign to him. Executive agrees to devote his full time (excluding annual
vacation time), skill, knowledge, and attention to the business of the Company
and the performance of his duties under this Agreement.
2. Termination, Bonus, and Severance Pay.
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a. As used in this Agreement, a Change in Control means:
(i) a sale of over 50% of the stock of APW Ltd. measured in
terms of voting power, other than in a public offering; or
(ii) the sale by APW Ltd. of over 50% of its business or assets
in one or more transactions over a consecutive 12-month period; or
(iii) a merger or consolidation of APW Ltd. with or into any other
corporation or corporations such that the shareholders of APW Ltd.
prior to the merger or consolidation do not own at least 50% of the
surviving entity measured in terms of voting power; or
(iv) the acquisition by any means of more than 25% of the voting power
or common stock of APW Ltd. by any person or group of persons (with group
defined by the definitions under Section 13(d)(3) of the Securities
Exchange Act of 1934, as amended); or
(v) the election of directors constituting a majority of APW Ltd.'s
board of directors pursuant to a proxy solicitation not recommended by APW
Ltd.'s board of directors.
b. As used in this Agreement, a Triggering Event means:
(i) (a) reducing the base salary paid to the Executive or (b) a
material reduction in Executive's bonus opportunity or (c) reducing the
total aggregate value of the fringe benefits received by the Executive from
the levels received by the Executive at the time of a Change in Control or
during the 180 day period immediately preceding the Change in Control; or
(ii) a material change in the Executive's position or duties or the
Executive's reporting responsibilities from the levels existing at the time
of a Change in Control or during the 180 day period immediately preceding
the Change in Control; or
(iii) a change in the location or headquarters where the Executive is
normally expected to provide services to a location of 40 or more miles
from the previous location existing at the time of the Change in Control or
during the 180 day period immediately preceding the Change in Control.
c. If the Company terminates Executive's employment within the period
beginning six months prior to a Change in Control and ending 36 months following
a Change in Control or Executive voluntarily terminates his services following a
Triggering Event that occurs within 36 months following the date of a Change in
Control, the Company shall pay to the Executive a lump sum equal to the sum of
(a) the highest per annum base rate of salary in effect with respect to the
Executive during the one-year period immediately prior to the termination of
employment plus (b) the highest annual bonus or incentive compensation earned by
the Executive under any cash bonus or incentive compensation plan of the Company
during the three complete fiscal years of the Company immediately preceding the
termination of employment. Such lump sum shall be paid by the Company to the
Executive within twenty days after the Executive's termination of employment. In
addition, the Company, at the Company's cost, shall continue to provide
Executive with the welfare benefits and other perquisites Executive was
receiving at the time of the Change in Control for a period of one year
following Executive's termination of employment or such earlier date as
Executive becomes employed by another employer and becomes eligible for
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welfare benefits. For purposes hereof, perquisites will include the
Executive's right to lease a car or a car allowance, as the case may be.
d. Notwithstanding any provision herein, no amounts will be due under
this Agreement in the event the Executive's employment is terminated by the
Company for cause. The term "for cause" shall mean solely the following
events:
(i) Executive has been convicted of a felony which has adversely
affected the Company's reputation;
(ii) Executive has materially misappropriated Company funds,
property or opportunities; or
(iii) Executive has materially breached any of the provisions of
this Agreement after having been provided by written notice a
reasonable opportunity (not less than 15 business days) to cure such
breach.
3. Certain Additional Payments by the Company.
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a. In the event it shall be determined that the severance benefits
payable to Executive under this Agreement or any other payments or benefits
received or to be received by the Executive (whether payable pursuant to
the terms of this Agreement, any other plan, agreement or arrangement) (the
"Payments") would be subject to the excise tax imposed by Section 4999 of
the Internal Revenue Code of 1986, as amended (the "Code") or any interest
or penalties are incurred by the Executive with respect to such excise tax
(such excise tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise Tax"), then the
Executive shall be entitled to receive an additional payment (a "Gross-Up
Payment"). The Gross-Up Payment shall be in an amount such that after
payment by the Executive of all taxes (including any interest or penalties
imposed with respect to such taxes), including, without limitation, any
income taxes (and any interest and penalties imposed with respect thereto)
and excise tax imposed on the Gross-Up Payment, the Executive retains an
amount of the Gross-Up Payment equal to the Excise Tax imposed upon the
Payments.
b. Subject to the provisions of paragraph c. of this Section 3, all
determinations required to be made under this Section 3, including whether
and when a Gross-Up Payment is required and the amount of such Gross-Up
Payment and the assumptions to be utilized in arriving at such
determination, shall be made by a certified public accounting firm
designated by the Executive (the "Accounting Firm"), which shall provide
detailed supporting calculations both to the Company and the Executive
within twenty business days of the receipt of notice from the Executive
that there has been a Payment, or such earlier time as is requested by the
Company. All fees and expenses of the Accounting Firm shall be borne solely
by the Company. Any Gross-Up Payment, as determined pursuant to this
Section 3,
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shall be paid by the Company to the Executive within five days of the
receipt of the Accounting Firm's determination. Any determination by the
Accounting Firm shall be binding upon the Company and the Executive. As a
result of the uncertainty in the application of Section 4999 of the Code at
the time of the initial determination by the Accounting Firm hereunder, it
is possible that Gross-Up Payments which will not have been made by the
Company should have been made ("Underpayment"), consistent with the
calculations required to be made hereunder. In the event that the Company
exhausts its remedies pursuant to paragraph c. of this Section 3 and the
Executive thereafter is required to make a payment of any Excise Tax, the
Accounting Firm shall determine the amount of the Underpayment that has
occurred and any such Underpayment shall be promptly paid by the Company to
or for the benefit of Executive.
c. The Executive shall notify the Company in writing of any claim by
the Internal Revenue Service that, if successful, would require the payment
by the Company of the Gross-Up Payment. Such notification shall be given as
soon as practicable but no later than ten business days after the Executive
is informed in writing of such claim and shall describe the nature of such
claim and the date on which such claim is requested to be paid. The
Executive shall not pay such claim prior to the expiration of the
thirty-day period following the date on which he gives such notice to the
Company (or such shorter period ending on the date that any payment of
taxes with respect to such claim is due). If the Company notifies the
Executive in writing prior to the expiration of such period that it desires
to contest such claim, the Executive shall:
(i) give the Company any information reasonably requested by the
Company relating to such claim,
(ii) take such action in connection with contesting such claim as
the Company shall reasonably request in writing from time to time,
including, without limitation, accepting legal representation with
respect to such claim by an attorney reasonably selected by the
Company.
(iii) cooperate with the Company in good faith in order
effectively to contest such claim, and
(iv) permit the Company to participate in any proceedings
relating to such claim;
provided, however, that the Company shall bear and pay directly all costs
and expenses (including additional interest and penalties) incurred in
connection with such contest and shall indemnify and hold the Executive
harmless, on an after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto) imposed as a result
of such representation and payment of costs and expenses. Without
limitation on the foregoing provisions of this paragraph c. of Section 3,
the Company shall control all proceedings taken
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in connection with such contest and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at
its sole option, either direct the Executive to pay the tax claimed and sue
for a refund or contest the claim in any permissible manner, and the
Executive agrees to prosecute such contest to a determination before any
administrative tribunal, in a court of initial jurisdiction and in one or
more appellate courts, as the Company shall determine; provided, however,
that if the Company directs the Executive to pay such claim and sue for a
refund, the Company shall advance the amount of such payment to the
Executive, on an interest-free basis and shall indemnify and hold the
Executive harmless, on an after-tax basis, from any Excise Tax or income
tax (including interest or penalties with respect thereto) imposed with
respect to such advance or with respect to any imputed income with respect
to such advance; and provided, further, that any extension of the statute
of limitations relating to payment of taxes for the taxable year of the
Executive with respect to which such contested amount is claimed to be due
is limited solely to such contested amount. Furthermore, the Company's
control of the contest shall be limited to issues with respect to which a
Gross-Up Payment would be payable hereunder and the Executive shall be
entitled to settle or contest, as the case may be, any other issue raised
by the Internal Revenue Service or any other taxing authority.
d. If, after the receipt by the Executive of an amount advanced by
the Company pursuant to paragraph c. of this Section 3, the Executive
becomes entitled to receive any refund with respect to such claim, the
Executive shall (subject to the Company's complying with the requirements
of paragraph c. of this Section 3) promptly pay to the Company the amount
of such refund (together with any interest paid or credited thereon after
taxes applicable thereto). If after the receipt by the Executive of an
amount advanced by the Company pursuant to paragraph c. of this Section 3,
a determination is made that the Executive shall not be entitled to any
refund with respect to such claim and the Company does not notify the
Executive in writing of its intent to contest such denial of refund prior
to the expiration of thirty days after such determination, then such
advance shall be forgiven and shall not be required to be repaid and the
amount of such advance shall offset, to the extent thereof, the amount of
Gross-Up Payment required to be paid.
4. Confidential Information. As a supplement to any other confidentiality
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provisions applicable to the Executive, Executive acknowledges that all
Confidential Information is and shall continue to be the exclusive proprietary
property of the Company, whether or not disclosed to or entrusted to the custody
of Executive. Executive will not, either during the term hereof or at any time
thereafter, disclose any Confidential Information, in whole or in part, to any
person or entity other than to employees or affiliates of the Company, for any
reason or purpose, unless the Company gives its prior written consent to such
disclosure. Executive also will not, either during the term hereof or at any
time thereafter, use in any manner any Confidential Information for his own
purposes or for the benefit of any person or entity except the Company and its
affiliates whether such use consists of duplication, removal, oral
communication, disclosure, transfer or other unauthorized use thereof, unless
the Company gives its prior written consent to such use. As used herein, the
term
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"Confidential Information" refers to all information and materials not in the
public domain belonging to, used by or in the business of the Company (the
"Business") relating to its business strategies, products, pricing, customers,
technology, programs, costs, employee compensation, marketing plans,
developmental plans, computer programs, computer systems, inventions,
developments, formulae, processes, designs, drawings, trade secrets of every
kind and character and competitive information. "Confidential Information" also
includes confidential information belonging to other companies and disclosed to
the Executive by the Company.
5. Non-competition and Inventions.
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a. During the period of employment of Executive and for a period of
one year after Executive's termination of employment for any reason,
Executive shall not directly or indirectly as a principal, agent, owner,
employee, consultant, advisor, trustee, beneficiary, distributor, partner,
co-venturer, officer, director, stockholder or in any other capacity, nor
will any entity owned by Executive:
(i) divert or attempt to divert any business from the Company or
engage in any act likely to cause any customer or supplier of the
Company to discontinue or curtail its business with the Company or to
do business with another entity, firm, business, activity or
enterprise directly or indirectly competitive with the Company; or
(ii) contact, sell or solicit to sell or attempt to contact, sell
or solicit to sell products competitive to those sold by the Company
to any customer of the Company with which Executive had contact while
performing services for the Company; or
(iii) solicit or attempt to solicit any employee of the Company
for employment or retention.
Notwithstanding the provisions above, Executive may acquire securities
of any entity the securities of which are publicly traded, provided that
the value of the securities of such entity held directly or indirectly by
Executive immediately following such acquisition is less than 5% of the
total value of the then outstanding class or type of securities acquired.
b. Executive acknowledges and agrees that the restrictions set forth
in this section 5 are founded on valuable consideration and are reasonable
in duration and geographic area in view of the circumstances under which
this Agreement is executed and that such restrictions are necessary to
protect the legitimate interests of the Company. If, in any judicial
proceeding, a court shall refuse to enforce any separate covenant set forth
herein, then such unenforceable covenant shall be deemed eliminated from
this section 4 for the purpose of that proceeding to the extent necessary
to permit the remaining separate covenants to be enforced.
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c. The Executive hereby sells, transfers and assigns to the Company
the entire right, title and interest of the Executive in and to all
inventions, ideas, disclosures and improvements, whether patented or
unpatented, and copyrightable materials, made or conceived by the
Executive, solely or jointly, or in whole or in part, during the period
Executive is bound by this Agreement which (i) relate to methods,
apparatus, designs, products, processes or devices sold, leased, used or
under construction or development by the Company or any subsidiary or (ii)
otherwise relate to or pertain to the business, functions or operations of
the Company or any subsidiary, or (iii) arise (wholly or partly) from the
efforts of the Executive during the Term hereof in connection with his
performance of his duties hereunder. The Executive shall communicate
promptly and disclose to the Company, in such form as the Company requests,
all information, details and data pertaining to the aforementioned
inventions, ideas, disclosures and improvements; and, whether during the
term hereof or thereafter, the Executive shall execute and deliver to the
Company such formal transfers and assignments and such other papers and
documents as may be required of the Executive to permit the Company to file
and prosecute the patent applications and, as to copyrightable material, to
obtain copyright thereon. This provision does not relate to any invention
for which (i) no equipment, supplies, facilities or trade secret
information of the Company was used and which was developed entirely on the
Executive's own time and which does not relate (A) directly to the business
of the Company, or (B) to the Company's actual or demonstrably anticipated
research or development; or (ii) does not result in any work performed by
the Executive for the Company.
d. The provisions in this paragraph are a supplement to any other
confidentiality and non-compete provisions applicable to the Executive in
any other agreements.
6. Miscellaneous.
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a. This Agreement shall be governed by and construed in accordance
with the internal laws of the State of Wisconsin, 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 otherwise 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:
If to the Executive, to his address appearing on the records of the
Company.
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If to the Company: APW Ltd.
N22 W23685 Ridgeview Parkway West
Waukesha, WI 53188-1013
Attention: President
With a copy to: Quarles & Brady LLP
411 East Wisconsin Avenue
Milwaukee, WI 53202
Attention: Anthony W. Asmuth III, Esq.
or to such other address as either party shall have furnished to the other
in writing in accordance herewith. Notice 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 or 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 strict
compliance with any provisions hereof or any other provision of this
Agreement or the failure to assert any right the Executive or the Company
may have hereunder, including, without limitation, the right of the
Executive to terminate employment for cause pursuant to this Agreement,
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 herein or under any other written agreement between
the Executive and the Company, the employment of the Executive by the
Company is "at will" and the Executive's employment may be terminated by
the Company at any time.
g. The Company agrees that if it breaches any payment obligation
hereunder, the Company will pay all reasonable attorney fees and costs
incurred by Executive in enforcing Executive's rights hereunder.
h. This Agreement may be executed in one or more counterparts, each
of which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument.
i. If the Company sells, leases, exchanges or otherwise disposes of,
in a single transaction or series of related transactions, all or
substantially all of its property and assets,
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or if the Company ceases to exist as a separate entity as a result of a
merger, spin-off, reorganization or otherwise, then the Company will, as a
condition precedent to any such transaction, cause effective provision to
be made so that the person or entity acquiring such property and assets or
succeeding to the business of the Company as the surviving entity of a
merger, spin-off, reorganization or otherwise, as applicable, becomes bound
by, and replaces the Company under, this Agreement.
7. Injunctive Relief. Executive acknowledges and agrees that irreparable
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injury will result to the Company in the event Executive breaches any covenant
contained in this Agreement and that the remedy at law for such breach will be
inadequate. Therefore, if Executive engages in any act in violation of the
provisions of this Agreement, the Company shall be entitled, in addition to such
other remedies and damages as may be available to it by law or under this
Agreement, to injunctive or other equitable relief to enforce the provisions
hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
date first above written.
APW Ltd.
By:________________________________________
___________________________________________
Todd Adams
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