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termination during the 7-year term of employment provided in the
Employment Agreement, and thereafter.
While the Employment Agreement provided for Mr. Polsky’s
employment by Indeck for 7 years until June 1, 1993, it further
entitled Indeck in its sole discretion to terminate Mr. Polsky’s
employment after 4 years in prescribed circumstances.2
Specifically, under paragraph 12.c. of the Employment Agreement,
Indeck was entitled to terminate the agreement (with 30 days’
notice) if, as of the fourth anniversary of the effective date of
the agreement, Indeck had a negative net worth of $500,000 or
more, as determined from its audited statements for the 4
previous fiscal years ended November 30, 1986, 1987, 1988, and
1989.
The Shareholders’ Agreement, which incorporated and cross-
referenced the Employment Agreement, provided that Mr. Polsky was
required to sell, and Indeck required to purchase, any Indeck
shares owned by Mr. Polsky in the event of the involuntary
termination of his employment after 4 years pursuant to paragraph
12.c. of the Employment Agreement. The Shareholders’ Agreement
further provided that the price to be paid by Indeck in these
circumstances was an amount equal to the greater of: (1) 100
2 Under the Employment Agreement, Indeck could otherwise
terminate Mr. Polsky’s employment at any point during the 7-year
term (with 30 days’ notice) in the event he “[failed] or
[refused] to faithfully or diligently perform the provisions of
this Agreement.”
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