Exhibit 10(u)
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, made and entered into as of the 30th day of
November 1998, by and between QUAKER CHEMICAL CORPORATION, a Pennsylvania
corporation (hereinafter referred to as "QUAKER"), and XXXXXXX X.
XXXXX (hereinafter referred to as "EXECUTIVE").
W I T N E S S E T H:
WHEREAS, QUAKER wishes to employ EXECUTIVE, and EXECUTIVE wishes to be
employed by QUAKER.
NOW, THEREFORE, in consideration of the mutual promises and covenants
herein contained, and intending to be legally bound hereby, the parties hereto
agree as follows:
1. QUAKER agrees to employ EXECUTIVE, and EXECUTIVE agrees to serve as
Vice President and Chief Financial Officer of QUAKER. He shall perform all
duties consistent with such position as well as any other duties which are
assigned to him from time to time by the Board of Directors or Chief Executive
Officer of QUAKER. EXECUTIVE covenants and agrees that he will, during the term
of this Employment Agreement or any extension or renewal thereof, devote his
knowledge, skill, and working time solely and exclusively to the business and
interests of QUAKER.
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2. Except as otherwise provided for in Paragraph 10, the term of
EXECUTIVE's employment shall continue until December 31, 1999 and shall continue
for annual calendar year terms thereafter until either party hereto shall have
given the other at least ninety (90) days' prior written notice of a desire to
terminate this Agreement and thereby terminate EXECUTIVE's employment with
QUAKER.
3. QUAKER shall pay to EXECUTIVE and EXECUTIVE shall accept an annual
rate of salary as set forth in Exhibit A attached hereto, payable semi-monthly,
during the term of this Employment Agreement or any extension or renewal
thereof. The rate of salary will be reviewed on an annual basis consistent with
QUAKER's then current practice for reviewing officers' salaries and performance.
4. EXECUTIVE shall participate in such QUAKER Incentive Programs as
described and set forth in Exhibit A. As an Officer of QUAKER, the particulars
of Exhibit A may be amended by the Board of Directors at any time as to any
matter set forth therein including eligibility to participate in any given
QUAKER incentive plan, the level of participation in any QUAKER incentive plan,
and the terms and conditions of any QUAKER incentive plan. Any changes to
Exhibit A shall not affect any of the other terms and conditions hereof
including, without limitation, the provisions of Paragraphs 7 through 9. For the
purposes of this Agreement, the term "QUAKER Incentive Program" shall refer to
each individual as well as the combined incentive programs approved by the Board
of Directors. Revisions to Exhibit A shall become effective upon notification in
writing by QUAKER.
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5. (a) With respect to QUAKER's Annual Bonus Plan for the 1998 year
only, EXECUTIVE's annual bonus (payable in early 1999) will be $50,000.
(b) With respect to QUAKER's Long-Term Performance Incentive Plan (the
"Incentive Plan"), for 1997-2000 performance award period under the terms and
conditions of the Incentive Plan. In connection therewith, EXECUTIVE will be
granted:
* Stock options - 15,000 to be issued to EXECUTIVE on the first day
of employment -- 6,000 to first become exercisable on the second
anniversary of the first day of employment; the next 6,000 to
first become exercisable on the third anniversary of the first
day of employment; and the remaining 3,000 to first become
exercisable on the fourth anniversary of the first day of
employment.
* Type of stock option offered - non-qualified stock options.
* Option price per share - closing price on first day of
employment.
* Performance incentive units - 9,000 @ $16.9375 (equal to 100% of
target value), such payment not to exceed $150,000.
In addition, Executive shall be entitled to a signing bonus as set forth on
Exhibit A to be paid in 1998.
(c) EXECUTIVE shall be entitled to four (4) weeks vacation per year,
beginning the calendar year 1999, paid holidays, and such other employee
benefits, including, without limitation, life insurance, medical benefits,
disability, profit sharing, and retirement benefits as are made generally
available to all senior QUAKER salaried officers as a group. In addition,
EXECUTIVE shall be eligible to participate in Quaker's Supplemental Retirement
Income Program.
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(d) QUAKER shall reimburse EXECUTIVE for all reasonable expenses
incurred by EXECUTIVE on behalf of QUAKER in the course of EXECUTIVE's
employment under this Employment Agreement, provided that such expenses shall
have been approved by QUAKER in accordance with such expense reimbursement
procedures as shall be adopted by QUAKER.
6. In the event of the death of EXECUTIVE while this Employment
Agreement is in effect and as to which no notice of termination has been given
by EXECUTIVE or, in the case of a Termination for Cause (as defined hereafter),
by QUAKER, QUAKER shall (i) continue to pay a sum of money equal to the salary
that would have been paid to him for four months following his death just as if
he were living, and (ii) QUAKER shall pay a death benefit equal to his then
current annual salary plus $30,000 to be paid in three equal payments, without
interest, on the 16, 28, and 40 month anniversary of the date of his death.
Payments made pursuant to this Paragraph 6 shall be made to the person or
persons who may be designated by EXECUTIVE in writing, and, in the event he
fails to so designate to whom payments shall be made, payments shall be made to
EXECUTIVE's personal representatives.
7. EXECUTIVE acknowledges that information concerning the method and
conduct of QUAKER's (and any affiliates') business, including, without
limitation, strategic and marketing plans, budgets, corporate practices and
procedures, financial statements, customer and supplier information, formulae,
formulation information, application technology, manufacturing information, and
laboratory test methods and all of QUAKER's (and any affiliates') manuals,
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documents, notes, letters, records, and computer programs are QUAKER's (and/or
QUAKER's affiliates', as the case may be) trade secrets ("Trade Secrets") and
are the sole and exclusive property of QUAKER (and/or QUAKER's affiliates, as
the case may be). EXECUTIVE agrees that at no time during or following his
employment with QUAKER will he use, divulge, or pass on, directly or through any
other individual or entity, any Trade Secrets. Upon termination of EXECUTIVE's
employment with QUAKER, or at any other time upon QUAKER's request, EXECUTIVE
agrees to forthwith surrender to QUAKER any and all materials in his possession
or control which include or contain any such Trade Secrets. The words "Trade
Secrets" do not include information already known to the public through no act
or failure to act on the part of EXECUTIVE, required by law to be disclosed, or
which can be clearly shown to have been known by EXECUTIVE prior to the
commencement of his employment with QUAKER.
8. EXECUTIVE agrees that during his employment and for a period of one
(1) year thereafter, regardless of the reason for the termination of EXECUTIVE'S
employment hereunder, he will not:
(a) directly or indirectly, together or separately or with any
third party, whether as an individual proprietor, partner, stockholder, officer,
director, joint venturer, investor, or in any other capacity whatsoever actively
engage in business or assist anyone or any firm in business as a manufacturer,
seller, or distributor of specialty chemical products or chemical management
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services which are the same, like, similar to, or which compete with the
products and services offered by QUAKER (or any of its affiliates);
(b) recruit or solicit any employee of QUAKER or otherwise
induce such employee to leave the employ of QUAKER or to become an employee or
otherwise be associated with his or any firm, corporation, business or other
entity with which he is or may become associated; and
(c) solicit, directly or indirectly, for himself or as agent
or employee of any person, partnership, corporation, or other entity (other than
for QUAKER) any then or former customer, supplier, or client of QUAKER with the
intent of actively engaging in business which would cause competitive harm to
QUAKER.
EXECUTIVE acknowledges and agrees that all of the foregoing
restrictions are reasonable as to the period of time and scope. However, if any
paragraph, sentence, clause, or other provision is held invalid or unenforceable
by a court of competent and relevant jurisdiction, such provision shall be
deemed to be modified in a manner consistent with the intent of such original
provision so as to make it valid and enforceable, and this Agreement and the
application of such provision to persons and circumstances other than those with
respect to which it would be invalid or unenforceable shall not be affected
thereby. EXECUTIVE agrees and recognizes that in the event of a breach or
threatened breach of the provisions of the restrictive covenants contained in
Paragraph 7 or in this Xxxxxxxxx 0, XXXXXX may suffer irreparable harm, and
monetary damages may not be an adequate remedy. Therefore, if any breach occurs
or is threatened, in addition to all other remedies available to QUAKER at law
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or in equity, QUAKER shall be entitled as a matter of right to specific
performance of the covenants of QUAKER contained herein by way of temporary or
permanent injunctive relief. In the event of any breach of the restrictive
covenant contained in this Paragraph 8, the term of the restrictive covenant
specified herein shall be extended by a period of time equal to that period
beginning on the date such violation commenced and ending when the activities
constituting such violation cease.
9. In the event that QUAKER in its sole discretion and at any time
terminates this Agreement with EXECUTIVE (other than for Termination for Cause,
death, disability, or normal retirement age), QUAKER agrees to provide EXECUTIVE
with reasonable out-placement assistance and a severance payment (contingent
upon EXECUTIVE executing a form of release satisfactory to QUAKER) that shall be
equal to twelve (12) months' salary calculated at EXECUTIVE's then current rate.
10. Termination. This Employment Agreement also can be terminated (and
thereby terminate EXECUTIVE's employment with QUAKER) at any time and without
notice by "Termination for Cause." Termination for Cause means EXECUTIVE's
employment with QUAKER shall have been terminated by QUAKER by reason of either:
(a) The willful and continued failure (following written
notice) by EXECUTIVE to execute his duties under this Employment Agreement; or
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(b) The willful engaging by EXECUTIVE in a continued course of
misconduct which is materially injurious to QUAKER, monetarily or otherwise.
11. EXECUTIVE represents and warrants to QUAKER that:
(a) there are no restrictions, agreements, or understandings
whatsoever to which EXECUTIVE is a party which would prevent or make unlawful
his execution of this Employment Agreement or his employment hereunder; and
(b) his execution of this Employment Agreement and his
employment hereunder shall not constitute a breach of any contract agreement, or
understanding, oral or written, to which he is a party or by which he is bound.
13. This Employment Agreement contains all the agreements and
understandings between the parties hereto with respect to EXECUTIVE's employment
by QUAKER and supersedes all prior or contemporaneous agreements with respect
thereto and shall be binding upon and for the benefit of the parties hereto and
their respective personal representatives, successors, and assigns. This
Employment Agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Pennsylvania without regard to any conflict of laws.
IN WITNESS WHEREOF, QUAKER has caused this Employment Agreement to be
signed by its Chairman of the Board, thereunto duly authorized, and its
corporate seal to be hereunto affixed and attested by its Corporate Secretary,
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and EXECUTIVE has hereunto set his hand and seal all as of the day and year
first above written.
ATTEST: QUAKER CHEMICAL CORPORATION
(SEAL)
/s/ D. Xxxxxx Xxxxxxxx By: /s/ Xxxxxx X. Xxxxxx
-------------------------- --------------------------------
D. Xxxxxx Xxxxxxxx Xxxxxx X. Xxxxxx
Corporate Secretary Chairman and Chief Executive Officer
WITNESS:
/s/ Xxxx X. Xxxxx /s/ Xxxxxxx X. Xxxxx
------------------------- --------------------------------
Xxxxxxx X. Xxxxx
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EMPLOYMENT AGREEMENT
EXHIBIT A
Effective: November 30, 1998
Name of Employee: Xxxxxxx X. Xxxxx
Address:
Title: Vice President and Chief Financial Officer
Annual Rate of $190,000
Salary at Starting Date: November 30, 1998
Signing Bonus: $25,000
Participation in Quaker Incentive Programs
Annual Bonus Plan (1998)
------------------------
Bonus will be based on achieving certain benchmarks set on
annual basis, as follows:
Threshold level -- 12.5% of midpoint
Target level -- 25% of midpoint
Maximum level -- 50% of midpoint
For the 1998 year only, the Annual Bonus (payable in early 1999) will
be $50,000.
Long-Term Performance Incentive Plan 1997 -2000
-----------------------------------------------
Will be full participant in Plan, even though entering approximately
two (2) years after the start, at the following level:
* Stock options - 15,000 to be issued to EXECUTIVE on the
first day of employment -- 6,000 shall first become
exercisable on the second anniversary of the first day of
employment; 6,000 shall first become exercisable on the
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third anniversary of the first day of employment; and the
remaining 3,000 to first become exercisable on the third
anniversary of the first day of employment.
* Type of stock option offered - non-qualified stock
options.
* Option price per share - closing price on first day of
employment.
* Performance incentive units - 9,000 @ $16.9375 (equal to
100% of target value), such payment not to exceed
$150,000.
Long-Term Performance Incentive Plan 1999 -2002
-----------------------------------------------
Will be eligible to participate in the Plan at the levels commensurate
with the position of Vice President-Chief Financial Officer as
recommended by management. Under the terms of the Plan, however, only
the Compensation Committee of Quaker's Board of Directors has the
authority to grant awards under the Plan and therefore, there can be no
assurance that the Compensation Committee will act on management's
recommendation.
Exhibit 10(u) Page 11
