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Exhibit 10.17
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT made as of the first day of July 1998 by and among Cronos
Containers Limited, a company incorporated in England and Wales (the
"Employer"), Cronos Capital Corporation, a USA corporation, and Xxxxx X. Xxxxxxx
("Younger").
WITNESSETH:
WHEREAS, the Employer desires to employ Younger and Younger desires to be
employed by the Employer under the terms and conditions hereinafter set forth in
this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants herein contained and
other good and valuable consideration, the parties agree as follows:
1. The Employer agrees to employ Younger and Younger agrees to serve in the
employ of the Employer, as Chief Financial Officer, subject to the supervision
and direction of its Board of Directors, and as a Director of Employer and its
American affiliates until terminated as provided herein.
2. Younger hereby warrants and represents that he has the full right and
authority to enter into this Agreement and to perform all of his obligations
hereunder and that he is not party to any other agreement or understanding which
might conflict with the provisions hereof or affect or interfere with the full
performance by him of all of his obligations hereunder. This agreement
supersedes all prior contracts between the Employer and Younger, and shall take
precedence over any other agreement between Younger and The Cronos Group or any
of its subsidiaries. Younger's office and the principal place for the
performance of his duties hereunder, except for travel reasonably required,
shall be at the place of business of the Employer or at another location
mutually agreed upon between Employer and Younger.
3. (a) For all services to be rendered by him in an executive capacity only
(including, but not limited to, services as an officer, director, member of any
committee or otherwise) of Employer or any affiliate, Employer shall pay Younger
as long as he shall be employed hereunder a salary of one hundred twenty-three
thousand eight hundred seventy-five pounds (pound sterling 123,875) per annum
(such salary is referred to herein as "basic compensation"), payable in twelve
equal monthly installments in arrears not later than the last day of each month.
(b) In addition to the basic compensation, Younger shall be given an
annual bonus generally related to the financial performance of Employer and its
affiliates and the performance of Younger during each calendar year. Such bonus
will be paid under the terms and conditions of a bonus plan established for all
employees of Employer and its subsidiaries. In addition, reasonable and
necessary expenses incurred by Younger in the performance of duties under this
Employment Agreement will be reimbursed to Younger upon receipt of documentation
in customary form adequate to establish the deductibility of each item of
expense to Employer. Younger shall also be entitled to all benefits provided by
the Employer to its employees generally.
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(c) For each year or part of a year that Younger performs duties for
any entity within the Cronos Group which subject any of his earnings from that
employment to income tax in the United Kingdom, Cronos Containers Limited shall
pay Younger a tax equalization payment equal to:
(TAX-UST)*1.50
where
TAX equals the actual amount of income taxes in all jurisdictions,
including but not limited to, federal, national, state, municipal and local
(collectively, "Income Taxes") payable for a year by Younger; and
UST equals the amount of Income Taxes that would have been payable by
Younger for the year in question if all his income from employment by the Cronos
Group had been earned and paid in the State of California, U.S.A. and all other
income had been received where it was.
The resulting amount shall not in any case be less than zero.
The tax equalization payment called for by this paragraph shall be paid
retroactively for the year 1997 and for each subsequent year. Younger shall
invoice Cronos Containers Limited for the amount of the payment reasonably
promptly after becoming able to determine the amount and shall supply Cronos
Containers Limited with such information and tax documentation as it shall
require in reviewing the invoice.
(d) Cronos Containers Limited shall reimburse Younger for 1) his
reasonable and necessary expenses in preparing income tax returns for himself
and/or his wife for each year or partial year that he is employed by any entity
within the Cronos Group beginning with 1997 in any jurisdiction in which any of
his earnings from the Cronos Group are subject to income taxation; and 2) the
cost of determining the amount of any tax equalization payment due.
(e) Younger, his wife and his children are entitled to seek, at Cronos
Containers Limited's expense, medical care which is, in their sole discretion,
of the same quality and convenience that they would have received, and at the
same total expense to Younger that Younger would have incurred for such care, if
each of them had been treated while Younger was covered by Cronos Capital
Corporation's medical, dental and other health-related benefits. To the extent
that Younger has unreimbursed medical expenses resulting from medical treatment
for himself or his wife or children, he may submit them to the Cronos Capital
Corporation executive in charge of medical benefits, together with any other
information required by Cronos Capital Corporation, for reimbursement pursuant
to the standards set forth in this paragraph. The decision of the executive in
charge of medical benefits concerning the amount of reimbursement due Younger
shall be final unless not made in good faith. Neither Cronos Containers Limited
nor Cronos Capital Corporation nor any other entity of the Cronos Group shall
ever be responsible for any consequences or damages flowing from any act or
omission in providing medical care to Younger or any family member. The maximum
amount of reimbursement to which Younger is entitled for all medical expenses
for his entire family for any calendar year is pound sterling 15,000.
(f) In the event of a change of ownership or control of The Cronos
Group (Luxembourg), Younger shall be entitled to 1) an immediate payment of
twice the amount of his total salary and bonuses earned from all entities within
the Cronos Group during the full calendar year ending last prior to the
effective date of the change of control, and 2) continuation of medical
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benefits at the level provided in this Agreement until he first obtains medical
benefits from employment thereafter, or for two years, whichever shall first
occur. As used in this paragraph, "change of ownership or control" means a
change in ownership or control that would constitute a change of ownership of a
corporation's real property in California under the standards of California
Revenue and Taxation Code Section 64(c)(1) as it was on December 31, 1998.
(g) Employer shall provide Younger a car in accordance with the
company car policy.
(h) Notwithstanding any other provision in Employer's Policy Manual,
Younger is entitled to an aggregate of 20 days of vacation per annum for 1998
and each subsequent full year of employment under this agreement. No more than
five days of accrued vacation per annum may be carried forward and taken in a
subsequent year without the prior approval of the Board of Directors of the
Employer.
(i) On the termination of his appointment for whatever reason, Younger
shall either be entitled to pay in lieu of outstanding vacation entitlement or
be required to repay to the Employer any salary received for vacation taken in
excess of his actual entitlement. The basis for payment and repayment shall be
1/260 x of Younger's annual basic salary for each day.
4. During the period of his employment Younger will not without the
approval of the Board of Directors of the Employer be an officer, director or
employee of any other company (other than a subsidiary or affiliate of
Employer). Younger shall devote his entire business time, energy and ability
exclusively to the business of Employer and its affiliates and shall not without
Employer's written consent render to others services of any kind for
compensation.
5. (a) Any provision of this Agreement to the contrary notwithstanding,
in the event Younger shall, during the term of his employment hereunder, fail to
perform his duties hereunder owing to illness or other incapacity which
continues for a period of more than six (6) consecutive months, the Employer
shall have the right, by notice sent to Younger by hand delivery, telefax (if
electronically confirmed), or mail, postage prepaid, to terminate Younger's
employment hereunder as of a date (not less than thirty (30) days after the date
of the sending of such notice) to be specified in such notice, and Younger shall
be entitled to receive all compensation provided in Paragraph 3 hereof computed
to or on the basis of the date specified in said notice. However, if prior to
the date specified in such notice, Younger shall resume the performance of his
duties hereunder, said notice shall be deemed to be canceled and rendered null
and void.
(b) If Younger is absent because of sickness (including mental
disorder) or injury he shall report this fact forthwith to the Human Resources
Department and if Younger is so prevented for seven or more consecutive days he
shall provide a medical practitioner's statement on the eighth day and weekly
thereafter so that the whole period of absence is certified by such statements.
Immediately following his return to work after a period of absence Younger shall
complete a Self-Certification form available from the Human Resources Department
detailing the reason for his absence.
(c) If Younger shall be absent due to sickness (including mental
disorder) or injury, duly certified in accordance with the provisions of
sub-clause 5(b) hereof, he shall be entitled to receive his full basic salary
for a period of six months of continuous absence or for 25 days absence in
aggregate in any period of 12 consecutive months and thereafter if he remains
incapacitated by illness or accident and not able to carry out his normal
duties, Younger will be entitled, subject to the terms of the policy, to take
the benefit of the Employer's Disability Insurance Plan.
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(d) At any time during the period of his appointment, (but not
normally more often than once every second year) Younger shall at the request
and expense of the Employer permit himself to be examined by a registered
medical practitioner to be selected by the Employer and shall authorize such
medical practitioner to disclose to and discuss with the Employer's medical
adviser the results of such examination and any matters which arise from it in
order that the Employer's medical adviser can notify the Employer of any matters
which, in his opinion, might hinder or prevent the executive (if during a period
of incapacity) from returning to work for any period or (in other circumstances)
from properly performing any duties of his appointment at any time.
6. (a) Except as provided in Paragraph 5 above, this Agreement may not be
terminated or canceled by the Employer except for Younger's willful
non-performance of, or willful misconduct in the performance of, his duties
hereunder, or upon 2 years' prior written notice.
(b) If the Employer intends to terminate this Agreement pursuant to
Paragraph 6(a) above (except for Younger's willful misconduct amounting to moral
turpitude so as to affect his ability to adequately perform services on behalf
of the Employer, in which event the employment may be terminated immediately
upon notice), it shall give Younger detailed written notice by hand delivery,
telefax (if electronically confirmed) or mail, postage prepaid, to that effect
at least 2 years prior to the effective date of any such termination.
(c) Younger shall give to Employer a minimum of six months prior
written notice of his intention to terminate his employment under this
agreement.
(d) Upon termination or cancellation of this agreement for any reason,
Employer shall pay Younger's reasonable moving expenses for his household to any
single location to which Younger actually moves within the continental United
States upon receipt of documentation sufficient to establish the deductibility
of the expenses to Employer.
7. The Employer shall provide sufficient services, facilities and personnel
for Younger to perform his services hereunder.
8. (a) Younger acknowledges that during his employment with the Employer
he will have access to and will be entrusted with confidential information and
trade secrets relating to the business of the Employer or its affiliates and
their customers and suppliers, including, but not limited to, the contract rates
and expiration dates set forth in Employer's and its affiliates' contracts with
customers ("Confidential Information").
(b) Younger will not during the term of the appointment (otherwise
than in the proper performance of his duties and then only to those who need to
know Confidential Information) or thereafter (except with the written consent of
the Board or as required by law):
i) divulge or communicate to any person (including any
representative of the press or broadcasting or other media);
ii) cause or facilitate any unauthorized disclosure through any
failure by him to exercise all due care and diligence; or
iii) make use of (other than for the benefit of Employer or its
affiliates)
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any Confidential Information which may have come to his knowledge during his
past or current employment with Employer or its affiliates or in respect of
which Employer or any affiliate may be bound by an obligation of confidence to
any third party, provided Younger is or has been made aware of such obligation
of confidence. Younger will also use all reasonable endeavors to prevent the
publication or disclosure of any Confidential Information. These restrictions
will not apply to Confidential Information which, after the appointment has been
terminated, has become available to the public generally otherwise than through
unauthorized disclosure.
(c) All notes, memoranda and other records (whether in documentary
form or stored on computer disk or tape) made by Younger during his employment
with the Employer and which relate to the business of any affiliate of Employer
("Group Company") shall belong to such Group Company and Younger shall, from
time to time, promptly hand over such notes, memoranda and other records to the
Employer (or as the Employer may direct).
(d) Younger agrees that he will not at any time after the termination
of this Agreement, either personally or by his agent, directly or indirectly:
i) represent himself as being in any way connected with or
interested in the business of any Group Company;
ii) use or disclose to any person, firm or company any
confidential information directly or indirectly relating to the affairs of any
Employer or its affiliates or to a customer of any Employer or its affiliates
which may have been acquired by him in the course of or incidental to his
employment by the Employer for his own benefit or for the benefit of others or
to the detriment of any Employer or its affiliates or such customer. This
restriction shall continue to apply after the termination of this Agreement for
a period of one year but shall cease to apply to information or knowledge which
may come into the public domain or otherwise than through unauthorized
disclosure by Younger or any other person.
9. To the fullest extent permitted by law, Cronos Capital Corporation and
Cronos Containers Limited hereby jointly and severally agree to indemnify and
hold Younger harmless from any and all claims, demands, liabilities and damages,
including, but not limited to, attorneys' fees and other costs of defense,
arising from any actual or alleged service as an employee, agent, officer or
director of any entity within the Cronos Group, even if Younger's conduct in the
event is negligent or reckless or even amounts to willful injury, as that phrase
is used in California Civil Code Section 1668. Any entity indemnifying or
defending Younger in connection with a claim pursuant to this paragraph shall
have the power to settle such claim without Younger's consent.
10. Nothing in this Agreement shall be construed as limiting or restricting
any benefit to Younger, his legal representatives or Beneficiary, under any
pension, profit-sharing or similar retirement plan, or under any group life or
group health or accident or other plan of the Employer for the benefit of its
employees generally or a group of them, or under any other agreement between
Employer and Younger, now or hereafter in existence, nor shall any payment under
this Agreement be deemed to constitute payment to Younger, his legal
representatives or Beneficiary in lieu of or in reduction of any benefit or
payment under any such plan or agreement. It is understood and agreed that the
Employer shall offer to and provide Younger with all other benefits, employee
programs, facilities and emoluments which are offered to any other employee of
the Employer or of its affiliates now or at any time hereafter, unless the terms
of such plans
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specifically exclude him or he is ineligible to participate in such plans under
the terms thereof or applicable law.
11. This Agreement shall inure to the benefit of Younger's heirs, but neither
this Agreement nor any rights or interest under this Agreement shall be
assignable by Younger or by Younger's heirs without the Employer's prior written
consent.
12. (a) Any notice to the Employer under this Agreement shall be deemed to
have been given if and when sent by hand delivery, telefax (if electronically
confirmed) or mail, postage prepaid, to Employer at its principal office, or
such other address as the Employer may from time to time designate in writing by
notice to Younger given pursuant to Paragraph 12(b) hereof.
(b) Any notice to Younger under this Agreement shall be deemed to have
been given if and when sent by hand delivery, telefax (if electronically
confirmed) or first- class mail, postage prepaid, to Younger at this address
herein below given or such other address as Younger may from time to time
designate in writing by notice to the Employer given pursuant to Paragraph 12(a)
above. Younger's address is 0000 Xxxxxx Xxxxxx, XX, Xxxxx, XX 00000.
13. (a) No amendment or modification of this Agreement shall be deemed
effective unless and until executed in writing by the parties hereto with the
same formality attending execution of this Agreement.
(b) No term or condition of this Agreement shall be deemed to have
been waived, nor shall there by any estoppel to enforce any provision of this
Agreement, except by written instrument of the party charged with such waiver or
estoppel executed with the same formality attending execution of this Agreement.
14. (a) Any dispute between the Employer and Younger concerning the terms
and provisions of this Agreement, or the interpretation, application,
enforceability or validity thereof, shall be resolved by arbitration in
California, United States of America before the American Arbitration Association
pursuant to its rules for commercial arbitration. Judgment upon any amount
rendered by the arbitrators may be entered in any court having jurisdiction
thereof. The prevailing party in any arbitration as determined by the
arbitrators shall be entitled to recover, in addition to any award, all fees and
costs he or it incurs in the arbitration, including, without limitation,
reasonable attorneys' fees and costs and costs and fees of the arbitrators.
(b) This Agreement shall be governed by and construed in accordance
with the laws of California with respect to the validity, interpretation,
performance and enforcement of this Agreement. In the event that any provision
in or obligation under this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions or obligations shall not in any way be affected or impaired thereby.
(c) The Agreement is the complete and exclusive statement of the
parties' agreement concerning Younger's employment. No additional terms exist.
No representation not set forth herein has been made to or relied on by any
party.
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WITNESS WHEREOF, the Employer and Cronos Capital Corporation have caused
this Agreement to be executed by their duly authorized officer, and Younger has
signed this Agreement effective as of July 1, 1998.
EMPLOYER
CRONOS CONTAINERS LIMITED
By
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Xxxxxx X. Xxxxx
Its Attorney-In-Fact
Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
CRONOS CAPITAL CORPORATION
By
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Title
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