EMPLOYMENT AGREEMENT
Between
XXXXXX PACKAGING COMPANY L.P.
And
Senior Vice President and General Manager
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT dated as of June 27, 2002 (the "Agreement")
between Xxxxxx Packaging Company, L.P., Ashok Sudan ("Executive").
WHEREAS, the Company desires to continue to employ Executive as its
Senior Vice President and General Manager and Executive desires to remain
employed as the Senior Vice President and General Manager on the terms and
subject to the conditions set forth herein:
NOW, THEREFORE, in consideration of the promises and the mutual
agreements contained herein, the Company and Executive hereby agree as follows:
Article I.
DEFINITIONS
The terms set forth below have the following meanings (such meanings to
be applicable to both the singular and plural forms, except where otherwise
expressly indicated):
1.1 "Accrued Annual Bonus" means the amount of any Annual Bonus earned but not
yet paid with respect to the Year ended prior to the Date of Termination.
Such bonus is considered earned for a given Year as of December 31 of that
Year.
1.2 "Accrued Base Salary" means the amount of Executive's Base Salary that is
accrued but not yet paid as of the Date of Termination.
1.3 "Affiliate" means any Person directly or indirectly controlling, controlled
by, or under direct or indirect common control with, the Company. For the
purposes of this definition, the term "control" when used with respect to
any Person means the power to direct or cause the direction of management
or policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise.
1.4 "Agreement" -- see the recitals to this Agreement
1.5 "Agreement Date" means the date that is specified in the recitals to this
Agreement.
1.6 "Anniversary Date" means any anniversary of the Agreement Date.
1.7 "Annual Bonus -- see Section 4.2(a).
1.8 "Annualized Total Compensation" means, as of any date, the sum of
Executive's Base Salary as of such date and (i) if the determination is
being made prior to the occurrence of a Change of Control, then the average
of the Annual Bonuses earned by Executive with respect to each of the
previously completed Years occurring during the Employment Period (up to a
maximum of the three most recently completed Years); provided, that if such
Termination of Employment occurs prior to the end of the first Year ending
during the Employment Period, then an amount equal to the Target Annual
Bonus applicable to the Year that includes such date or (ii) if the
determination is being made following a Change of Control, the Target
Annual Bonus applicable to the Year that includes such date.
1.9 "Base Salary" -- see Section 4.1.
1.10 "Beneficial Owner" means a "beneficial owner," as such term is defined in
Rule 13d-3 under the Exchange Act (or any successor rule thereto).
1.11 "Beneficiary" -- see Section 9.3.
1.12 "Blackstone" means collectively, Blackstone Capital Partners III Merchant
Banking Fund L.P., Blackstone Offshore Capital Partners III L.P. and their
Affiliates (other than the Company and its Subsidiaries).
1.13 "Board" means the Board of Directors of the Company subsequent to the
incorporation of the L.P. and the substitution of it as successor for the
L.P. as a party to this Agreement. Prior thereto, the Board shall mean the
General Partner (as defined in the LP Agreement).
1.14 "Cause" means any of the following:
(a) Executive's continuing refusal to perform his material duties or to
follow a lawful direction of the Company, which duties and directions
are consistent with his position:
(b) Executive's intentional act or acts of dishonesty that Executive
intended to result in his personal, more-than-immaterial enrichment;
(c) Executive's documented willful malfeasance or willful misconduct in
connection with his employment or Executive's willful and deliberate
insubordination to directions of the Board or any executive officer to
whom he directly reports; or
(d) Executive is convicted of a felony.
"Cause" excludes:
(x) Any act or omission that Executive reasonably believed in good faith
to have been in or not opposed to the interest of the Company (without
intent of Executive to gain therefrom, directly or indirectly, a
profit to which he was not legally entitled), or
(y) Any act or omission taken or omitted at the direction of a member of
the Board.
1.15 "Change of Control" means any of the following events:
(a) the sale or disposition, in one or a series of transactions, of all or
substantially all, of the assets of the Company to any one or more
"persons" or "groups" (as such terms are defined in Sections 13 (d)(3)
or 1 4(d)(2) of the Exchange Act) other than Blackstone;
(b) before the effective date of an initial public offering of the equity
securities of the Company (or of its successor after conversion to a
corporation) (the "IPO Date"), representatives of Blackstone
(individually or in the aggregate) cease to comprise a majority of the
Board;
(c) individuals who, as of the IPO Date, constitute the Board (the
"Incumbent Board") cease for any reason to constitute a majority of
the members of the Board; provided that any individual who becomes a
Director after the IPO Date whose election or nomination for election
by the Company's Shareholders was approved by a majority of the
members of the Incumbent Board (other than an election or nomination
of an individual (i) who is not a representative of Blackstone and
(ii) whose initial assumption of office is in connection with an
actual or threatened "election contest" relating to the election of
the Directors of the Company (as such terms are used in Rule 14a-1 1
under the Exchange Act), "tender offer" (as such term is used in
Section 14(d) of the Exchange Act) or a proposed merger) shall be
deemed to be members of the Incumbent Board; or
(c) any person or group, other than Blackstone, is or becomes the
Beneficial Owner, directly or indirectly, of more than 50% of the
total voting power of the voting stock of the Company (or any entity
which controls the Company or which is a successor to all or
substantially all of the assets of the Company), including by way of
merger, consolidation, tender or exchange offer or otherwise and the
representatives of Blackstone (individually or in the aggregate) cease
to comprise a majority of the Board.
Notwithstanding the foregoing, there shall not be Change of Control if, in
advance of such event, Executive agrees in writing that such event shall
not constitute a Change of Control.
1.16 "Code" means the Internal Revenue Code of 1986, as amended from time to
time.
1.17 "Committee" means the Compensation Committee of the Board.
1.18 "Common Stock" means the common stock of the Company following its
incorporation, and the equivalent L.P. units prior to its incorporation.
1.19 "Company"-- see the recitals to this Agreement.
1.20 "Company Inventions" - see Section 8.2(b).
1.21 "Date of Termination" means the effective date of a Termination of
Employment for any reason, including death or Disability, whether by either
the Company or the Executive.
1.22 "Director" means a director of the Company subsequent to its incorporation
or a member of the governing body of the L.P. prior to its incorporation.
1.23 "Disability" means the inability of Executive to perform in all material
respects his duties and responsibilities of the Company or any Subsidiary,
by reason of a physical or mental disability or infirmity which inability
is reasonably expected to be permanent and has continued for a period of
six consecutive months or for an aggregate of nine (9) months in any
twenty-four (24) consecutive month period.
1.24 "Employment Period" -- see Section 3.1.
1.25 "Exchange Act" means the Securities Exchange Act of 1934, as amended or any
successors thereto.
1.26 "Executive" -- see the recitals to this Agreement.
1.27 "Executive Career Transition Services" means full use of a national
outplacement consultant (e.g., Challenger, Xxxx & Christmas, Inc., Right
Associates) or other consultant mutually agreeable to the Company and
Executive; office space, secretarial support; technological support;
equipment and supplies of a quality substantively equal to those provided
during the Employment Period, and continuation of expense reimbursement for
professional and trade association participation on the same terms as
during the Employment Period.
1.28 "Extension Date" - see Section 3.2.
1.29 "Good Reason" means the occurrence of any one or more of the following
events unless Executive specifically agrees in writing that such event
shall not be Good Reason:
(a) The failure of the Company to pay or cause to be paid Executive's Base
Salary or Annual Bonus, when due hereunder;
(b) Any substantial diminution in Executive's authority or
responsibilities from those described in Section 2.1 hereof;
(c) Requiring Executive to be principally based at any office or location
more than 50 miles from the current offices of the Company in York,
Pennsylvania;
(d) Any material reduction in Executive's Target Annual Bonus opportunity
after a Change of Control as compared with the Annual Bonus earned for
the preceding Year; or
(e) The failure of the Company, as the successor to the L.P. at the time
of its incorporation in conjunction with the initial public offering,
or otherwise, to assume and become a party to the Agreement in
substitution for the L.P.;
provided that the events described in this Section 1.31 shall constitute
Good Reason only if the Company fails to cure such event within 30 days
after receipt from Executive of written notice of the event that
constitutes Good Reason; provided, further, that "Good Reason" shall cease
to exist for an event on the 60th day following the later of its occurrence
or Executive's knowledge thereof, unless Executive has given the Company
written notice thereof prior to such date.
1.30 "including" means including without limitation.
1.31 "Inventions" - see Section 8.2(a).
1.32 "LP Agreement" means the Amended and Restated Agreement of Limited
Partnership of Xxxxxx Packaging Company.
1.33 "Option" means an option to purchase shares of Common Stock.
1.34 "Permitted Transferee" means the spouse of Executive, a lineal descendant
of Executive or a spouse of a lineal descendant of Executive or a trust,
limited partnership or other entity principally benefiting all or a portion
of such individuals.
1.35 "Person" means any individual, sole proprietorship, partnership, joint
venture, trust, unincorporated organization, association, corporation,
institution, public benefit corporation, entity or government
instrumentality, division, agency, body or department.
1.36 "Prior Inventions" - see Section 8.2(a).
1.37 "Prorata Annual Bonus" means the product of (a) the Annual Bonus Executive
would have been entitled to receive pursuant to Section 4.2 hereof in the
Year of the Executive's Termination of Employment multiplied by (b) a
fraction of which the numerator is the numbers of days that have elapsed in
such Year of Termination of Employment through the Date of Termination and
the denominator is 365.
1.38 "Restricted Period" means the eighteen month period immediately following a
Termination of Employment for any reason; provided, however, that the
Restricted Period shall mean the twelve month period immediately following
a Termination of Employment due to the Company's election not to renew the
Employment Period pursuant to Section 3.2 following the fourth anniversary
of the Agreement Date, such that the Employment Period terminates on or
after the fifth anniversary of the Agreement Date.
1.39 "Shareholder" or "Stockholder" means an owner of the Company's securities.
1.40 "Subsidiary" means, with respect to any Person, (a) any corporation of
which more than 50% of the outstanding capital stock having ordinary voting
power to elect a majority of the board of directors of such corporation
(irrespective of whether, at the time, stock of any other class or classes
of such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time, directly or indirectly, owned
by such Person, and (b) any partnership, limited liability company or other
entity in which such Person has a direct or indirect interest (whether in
the form of voting or participation in profits or capital contribution) of
more than 50%.
1.41 "Target Annual Bonus" means the product of Base Salary (at a point in time)
multiplied by 115 percent, as such percentage may be adjusted upwards from
time to time by the Board.
1.41 "Termination For Good Reason" means a Termination of Employment during the
Employment Period by Executive for Good Reason.
1.42 "Termination of Employment" means a termination by the Company or by
Executive (or due to Executive's death) of Executive's employment with the
Company or its Affiliates.
1.42 "Termination Without Cause" means a Termination of Employment during the
Employment Period by the Company for any reason other than Cause or
Executive's death or Disability
1.43 "Year" means a calendar year period ending on December 31.
Article II.
DUTIES
2.1 Duties. The Company shall employ Executive during the Employment Period as
its Senior Vice President and General Manager. During the Employment
Period, Executive shall perform the duties assigned to him hereunder by the
Board from time to time, shall devote his full business time, attention and
effort to the affairs of the Company and shall use his reasonable best
efforts to promote the interests of the Company. During the Employment
Period, and excluding any periods of disability, vacation, or sick leave to
which Executive is entitled, Executive agrees to devote his full attention
and time to the business and affairs of the Company.
2.2 Other Activities. Executive may (i) serve on corporate, civic or charitable
boards or committees, deliver lectures, fulfill speaking engagements, or
teach at educational institutions, subject to the consent of the Board
(which shall not be unreasonably withheld) and/or (ii) manage personal
investments, provided that all such activities do not individually or in
the aggregate significantly interfere with the performance of his duties
under this Agreement or violate Section 8.1 of this Agreement.
Article III.
EMPLOYMENT PERIOD
3.1 Employment Period. Subject to Section 3.2 and the termination provisions
hereinafter provided, the term of Executive's employment under this
Agreement (the "Employment Period") shall begin on the Agreement Date and
end on the Anniversary Date, or, if applicable at the end of any extension
pursuant to Section 3.2. The employment of Executive by the Company shall
not be terminated other than in accordance with Article VII.
3.2 Extensions of Employment Period. Commencing on the first Anniversary Date,
and on each Anniversary Date thereafter, (each an "Extension Date") if at
least 90 days before that date the Company has not delivered to Executive,
and Executive has not delivered to Company, a written notice that the
Employment Period will not be extended, the Employment Period will be
automatically extended for one year from its then scheduled expiration date
(i.e., the next occurring Extension Date).
Article IV.
COMPENSATION
4.1 Salary. The Company shall pay Executive in accordance with its normal
payroll practices (but not less frequently than monthly) an annual salary
at a rate of $202,370 per year ("Base Salary"). During the Employment
Period, the Base Salary shall be reviewed at least annually by the
Committee after consultation with Executive and may from time to time be
increased as determined by the Committee. Effective as of the date of any
such increase, the Base Salary as so increased shall be considered the new
Base Salary for all purposes of this Agreement. Any increase in Base Salary
shall not limit or reduce any other obligation of the Company to Executive
under this Agreement.
4.2 Annual Bonus.
(a) Subject to Section 7, Executive shall be eligible to earn an annual
cash bonus ("Annual Bonus") in accordance with the terms hereof for
the current Year and each subsequent Year that begins during the
Employment Period. Executive shall be eligible for an Annual Bonus
based upon the achievement of the financial budget or other
performance criteria established by the Board on or about January 15
or as soon thereafter as practicable, but in no event later than March
31 of such Year. The Annual Bonus shall be equal to the Target Annual
Bonus upon full achievement of the performance criteria, but may be
less than or more than the Target Annual Bonus upon lesser or greater
levels of achievement.
(b) The Company shall pay the entire Annual Bonus that is payable with
respect to a Year in a lump-sum cash payment as soon as practicable
after the Committee can determine whether and the degree to which the
performance criteria has or has not been achieved following the close
of such Year. Any such Annual Bonus shall in any event be paid no
later than the date annual bonuses are paid to the other qualifying
employees of the Company.
Article V.
OTHER BENEFITS
5.1 Incentive, Savings and Retirement Plans. In addition to Base Salary and the
Annual Bonus, Executive shall be entitled to participate during the
Employment Period in all incentive, savings and retirement plans,
practices, policies and programs that are from time to time generally
available to other senior executives of the Company.
5.2 Welfare Benefits. During the Employment Period, Executive and/or his
eligible dependents, as the case may be, shall be eligible for
participation in all benefits under welfare benefit plans, practices,
policies and programs provided by the Company (including any medical,
prescription, dental disability, salary continuance, employee life, group
life, dependent life, accidental death and travel accident insurance plans
and programs) generally available to other senior executives of the
Company.
5.3 Fringe Benefits. During the Employment Period, Executive shall be entitled
to all fringe benefits that are from time to time generally available to
other senior executives of the Company. The Company will continue its
current automobile expense program as in effect on the Agreement Date (or
establish a comparable replacement program), with such increases as are
consistent with past practices to reflect changes in expenses.
5.4 Vacation. During the Employment Period, Executive shall be entitled to paid
vacation time in accordance with the plans, practices, policies, and
programs generally available to other senior executives of the Company, but
in no event shall such vacation time be less than four weeks per calendar
year.
5.5 Expenses. During the Employment Period, Executive shall be entitled to
receive prompt reimbursement for all reasonable employment related expenses
incurred by Executive upon the receipt by either of the Company of
accounting in accordance with practices, policies and procedures generally
available to other senior executives of the Company.
5.6 Office Support Staff. During the Employment Period, Executive shall be
entitled to an office or offices of a size and with furnishings and other
appointments, and to secretarial and other assistance, appropriate to his
position and duties under this Agreement.
Article VI.
OTHER EXECUTIVE BENEFITS
6.1 Supplemental Retirement Benefits. Executive shall be entitled to
participate in any other supplemental defined benefit retirement plans of
the Company that are not qualified under Section 401 (a) of the Code,
generally available to other senior executives of the Company.
6.2 Non-qualified Option Agreement. Except as provided in Sections 7.4(b) and
7.6, this Agreement in no way modifies or limits the Non-Qualified Option
Agreements entered into between Executive and Xxxxxx Packaging Holdings
Company on January 1, 1999 and January 1, 2002. The Non-Qualified Option
Agreement conveys consideration separate from and in addition to
consideration conveyed in this Agreement, except to the extent that the
Non-Qualified Option Agreement increases benefits under operation of this
Agreement.
6.3 Equity Incentive Agreement. Except as provided in Sections 7.4(b) and 7.6,
this Agreement in no way modifies or limits the Equity Incentive Agreement
entered into between Executive and the Company on February 2, 1998. The
Equity Incentive Agreement conveys consideration separate from and in
addition to this Agreement, except to the extent that the Equity Incentive
Agreement increases benefits under operation of this Agreement.
Article VII.
TERMINATION BENEFITS
7.1 Termination of Employment. The Employment Period and Executive's employment
hereunder may be terminated by either party at any time and for any reason;
provided that Executive will be required to give the Company at least 60
days' advance written notice of any resignation of Executive's -employment.
Notwithstanding any other provision of this Agreement, the provisions of
this Article VII shall exclusively govern Executive's rights under this
Agreement following the expiration of the Employment Period or if
Executive's employment with the Company or its Affiliates is terminated
during the Employment Period for any reason.
7.2 Termination for Cause or Other Than for Good Reason, etc.
(a) If the Company terminates Executive's employment during the Employment
Period for Cause or Executive terminates his employment during the
Employment Period other than for Good Reason, death or Disability, the
Company shall pay to Executive immediately after the Date of
Termination an amount equal to Executive's Accrued Base Salary,
accrued but unpaid vacation, unpaid business expenses properly
incurred by Executive in accordance with Company policy prior to the
date of Executive's termination, and, if such Termination of
Employment is by the Executive other than for Good Reason, death or
Disability, the Accrued Annual Bonus, if any.
(b) Before terminating Executive's employment for Cause, the Board will
(i) specify in writing to Executive in detail the nature of the act,
omission, refusal, or failure that it deems to constitute Cause and
(ii) as to clauses (a) and (c) in the definition of "Cause," provide
Executive a reasonable opportunity to correct the purported problem
and avoid termination for Cause.
7.3 Termination for Death or Disability. If Executive's employment terminates
during the Employment Period due to his death or Disability, the Company
shall pay to Executive or his Beneficiaries, as the case may be, (i)
immediately after the Date of Termination an amount that is equal to the
sum of Executive's Accrued Base Salary and Accrued Annual Bonus, if any,
accrued but unpaid vacation and unpaid business expenses properly incurred
by Executive in accordance with Company policy prior to the date of
Executive's termination and (ii) at the time the Annual Bonus would have
otherwise been payable had Executive's employment not terminated, a Prorata
Annual Bonus.
7.4 Termination Without Cause or for Good Reason. In the event of a Termination
Without Cause or a
Termination for Good Reason, the Executive shall receive the following:
(a) Immediately after the Date of Termination, a lump-sum amount equal to
the sum of Executive's Accrued Base Salary, Accrued Annual Bonus, if
any, accrued but unpaid vacation and unpaid business expenses properly
incurred by Executive in accordance with Company policy prior to the
date of Executive's termination;
(b) Full vesting of Options and other equity awards granted to the
Executive that remain outstanding immediately prior to the Date of
Termination;
(c) A Prorata Annual Bonus at the time the Annual Bonus would have
otherwise been payable had Executive's employment not terminated;
(d) Continued monthly payment for a period of twenty-four months following
such Termination of Employment of an amount equal to the quotient of
(i) the Executive's Annualized Total Compensation divided by (ii)
twelve; provided that the aggregate amount described in this clause
(d) shall be reduced (but not below zero) by the present value of any
other cash severance or cash termination benefits payable to Executive
under any generally available or officer specific severance plans,
programs or arrangements of the Company or its affiliates, other than
any (i) retirement income benefit, (ii) benefits paid under the
Supplemental Income Plan and (iii) equity incentives and/or options;
(e) The continuation of health and dental benefits to which Executive is
entitled as of the Date of Termination for twenty-four months;
provided that such benefits shall cease upon the Executive's being
eligible for comparable benefits from a new employer;
(f) The continuation of the automobile expense program to which Executive
is entitled as of the Date of Termination for twelve months; provided
that such benefit ceases upon Executive's being eligible for
comparable benefits from a new employer; and
(g) For a period of 12 months from the Date of Termination, but no later
than the point at which the Executive is employed on a substantively
full time basis, Executive Career Transition Services, not to exceed
$30,000 in the aggregate.
7.5 Other Termination Benefits. In addition to any amounts or benefits payable
upon a Termination of Employment hereunder, Executive shall, except as
otherwise specifically provided herein, be entitled to any payments or
benefits provided under the terms of any plan, policy or program of the
Company in which Executive participates or as otherwise required by
applicable law.
7.6 Election Not to Extend the Employment Period. If the Company elects not to
extend the Employment Period pursuant to Section 3.2 such that the
Employment Period terminates prior to the fifth anniversary of the
Agreement Date, the nonextension shall be treated as a Termination without
Cause, for purposes of Section 7.4, as of the next scheduled Extension Date
or such earlier date as determined by Company. For the avoidance of doubt,
an election by the Company not to extend the Employment Period pursuant to
Section 3.2 such that the Employment Period terminates beyond the fifth
anniversary of the Agreement Date shall not constitute a Termination
without Cause and in such event Executive's termination of employment
hereunder (whether or not Executive continues as an employee of the Company
thereafter) shall be deemed to occur on the close of business on the day
immediately preceding the next scheduled Extension Date or such earlier
date as determined by Company. Upon such Termination of Employment,
Executive shall be entitled to receive:
(a) Immediately after the Date of Termination, a lump-sum amount equal to
the sum of Executive's Accrued Base Salary, Accrued Annual Bonus, if
any, accrued but unpaid vacation and unpaid business expenses properly
incurred by Executive in accordance with Company policy prior to the
date of Executive's termination;
(b) Full vesting of Options and other equity awards granted to the
Executive that remain outstanding immediately prior to the Date of
Termination;
(c) A Prorata Annual Bonus at the time the Annual Bonus would have
otherwise been payable had Executive's employment not terminated;
(d) Continued monthly payment for a period of twelve months following such
Termination of Employment of an amount equal to the quotient of (i)
the Executive's Annualized Total Compensation divided by (ii) twelve;
provided that the aggregate amount described in this clause (d) shall
be reduced (but not below zero) by the present value of any other cash
severance or cash termination benefits payable to Executive under any
generally available or officer specific severance plans, programs or
arrangements of the Company or its affiliates, other than any (i)
retirement income benefit, (ii) benefits paid under the Supplemental
Income Plan and (iii) equity incentives and/or options;
(e) The continuation of health and dental benefits to which Executive is
entitled as of the Date of Termination for twelve months; provided
that such benefits shall cease upon the Executive's being eligible for
comparable benefits from a new employer;
(f) The continuation of the automobile expense program to which Executive
is entitled as of the Date of Termination for twelve months; provided
that such benefit ceases upon Executive's being eligible for
comparable benefits from a new employer; and
(g) For a period of 12 months from the Date of Termination, but no later
than the point at which the Executive is employed on a substantively
full time basis, Executive Career Transition Services, not to exceed
$30,000 in the aggregate.
7.7 Continued Employment Beyond the Expiration of the Employment Period. Unless
the parties otherwise agree in writing, continuation of Executive's
employment with the Company beyond the expiration of the Employment Period
shall be deemed an employment at-will and shall not be deemed to extend any
of the provisions of this Agreement and Executive's employment may
thereafter be terminated at will by either Executive or the Company;
provided that the provisions of Article VIII of this Agreement shall
survive any termination of this Agreement or Executive's termination of
employment hereunder.
7.8 Board/Committee Resignation. Upon Executive's Termination of Employment for
any reason, Executive agrees to resign, as of the date of such termination
and to the extent applicable, from the Board (and any committees thereof)
and the Board of Directors (and any committees thereof) of any of the
Company's affiliates.
Article VIII.
RESTRICTIVE COVENANTS
8.1 Non-Solicitation of Employees; Confidentiality; Non-Competition.
(a) Executive covenants and agrees that, at no time during the Employment
Period nor during the Restricted Period, will Executive:
(i) Directly or indirectly employ or seek to employ any person (other
than his personal assistant) employed as of the date of
Executive's Termination of Employment or who left the employment
of the Company or its Affiliates coincident with, or within six
months prior to or after, the Executive's Termination of
Employment with the Company or otherwise encourage or entice any
such person to leave such employment (provided that this Section
8.1 (a)(i) shall not apply either to persons who had not become
employed by the Company before the Date of Termination or to
persons whose employment ended at any time as a result of the
Company's termination of those individuals without cause);
(ii) Become employed by, enter into a consulting arrangement with or
otherwise agree to perform personal services for a Competitor (as
defined in section 8.1 (b)).
(iii) Acquire an ownership interest, or an option to purchase an
ownership interest in a Competitor, other than a publicly traded
Competitor provided that ownership or option position in such
publicly traded Competitor does not exceed 5 percent;
(iv) Solicit any business of the Company on behalf of or for the
benefit of a Competitor; or
(v) Interfere with, or attempt to interfere with, business
relationships (whether formed before, on or after the date of
this Agreement) between the Company or any of its affiliates and
customers, clients, suppliers of the Company or its Affiliates.
(b) For purposes of the Section, "Competitor" means any Person that
produces blowmolded plastic containers or produces or provides any
other product or service of the Company that represents, as of the
Date of Termination, at least 10% of the consolidated revenues of the
Company (including, without limitation, products or services that
Executive is aware, as of the Date of Termination, that the Company
had specific plans (as evidenced through the most recent annual
corporate business plan or by resolutions of the Board) to produce or
provide during the twelve month period following the Date of
Termination and such products or services are reasonably anticipated
to represent at least 10% of the consolidated revenues of the Company
within the two years following the Date of Termination) that are
competitive with those sold by a business that is being conducted by
the Company or any Subsidiary at the time in question and was being
conducted at the Date of Termination. Notwithstanding anything to the
contrary in this Section, goods or services shall not be deemed to be
competitive with those of the Company solely as a result of
Executive's being employed by or otherwise associated with a business
of which a unit is in competition with the Company or any Subsidiary
(a "Competitive Unit") but as to which unit Executive does not have
direct or indirect responsibilities for the products or services
involved; provided, that such Competitive Unit contributes less than
25% of the consolidated revenues for the most recently completed
fiscal year of such business.
(c) Executive covenants and agrees that at no time during the Employment
Period nor at any time following any Termination of Employment will
Executive communicate, furnish, divulge or disclose in any manner to
any Person any Confidential Information (as defined in Section 8.1(d))
without the prior express written consent of the Company other than in
the course of Executive's employment. After a Termination of
Employment, Executive shall not, without the prior written consent of
the Company, or as may otherwise be required by law or legal process,
communicate or divulge such Confidential Information to anyone other
than the Company and its designees.
(d) For purposes of this Section, "Confidential Information" shall mean
financial information about the Company, contract terms with vendors
and suppliers, customer and supplier lists and data, know-how,
software developments, inventions, formulae, technology, designs and
drawings, or any Company property or confidential information relating
to research, operations, finances, current and proposed products and
services, vendors, customers, advertising, costs, marketing, trading,
investment, sales activities, promotion, manufacturing processes, or
the business and affairs of the Company generally, or of any
subsidiary or affiliate of the Company, trade secrets and such other
competitively-sensitive information, except that Confidential
Information shall not include any information that was or becomes
generally available to the public(i) other than as a result of a
wrongful disclosure by Executive, (ii) as a result of disclosure by
Executive during the Employment Period that he reasonably and in good
faith believes is required by the performance of his duties under this
Agreement, or (iii) any information compelled to be disclosed by
applicable law or administrative regulation; provided that Executive,
to the extent not prohibited from doing so by applicable law or
administrative regulation, shall give the Company written notice of
the information to be so disclosed pursuant to clause (iii) of this
sentence as far in advance of its disclosure as is practicable.
(e) Executive agrees that upon Executive's Termination of Employment with
the Company for any reason, he will return to the Company immediately
all memoranda, books, papers, plans, information, letters and other
data, and all copies thereof or therefrom, in any way relating to the
business of the Company, its affiliates and subsidiaries, except that
he may retain only those portions of personal notes, notebooks and
diaries that do not contain Confidential Information of the type
described in the preceding sentence. Executive further agrees that he
will not retain or use for Executive's own benefit, purposes or
account or the benefit, purposes or account of any other person, firm,
partnership, joint venture, association, corporation or other business
designation, entity or enterprise, other than the Company and any of
its Subsidiaries or Affiliates, at any time any trade names,
trademark, service xxxx, other proprietary business designation,
patent, or other intellectual property of the Company or its
Affiliates.
8.2 Inventions.
(a) Prior Inventions. Executive has attached hereto, as Exhibit A, a list
describing all inventions, works of authorship (including software,
related items, databases, documentation, site content, text or
graphics), developments, and improvements that relate to the Company's
proposed or current business, services, products or research and
development ("Inventions") that were created or contributed to by
Executive either solely or jointly with others prior to Executive's
employment with the Company and that relate to the Company's proposed
or current business, services, products or research and development
(collectively referred to as "Prior ------ Inventions") or, if no such
list is attached, Executive represents that there are no such Prior
Inventions. If in the course of Executive's employment with the
Company, Executive uses or relies upon a Prior Invention in
Executive's creation or contribution to any work of authorship,
invention, product, service, process, machine or other property of the
Company, Executive will inform the Company promptly and, upon request,
use Executive's best efforts to procure any consents of third parties
necessary for the Company's use of such Prior Invention. To the
fullest extent permissible by law, Executive hereby grants the Company
a non-exclusive royalty-free, irrevocable, perpetual, worldwide
license under all of Executive's Prior Inventions to make, have made,
copy, modify, distribute, use and sell works of authorship, products,
services, processes and machines and to otherwise operate the
Company's current and future business.
(b) Ownership of Inventions. Executive agrees that Executive will promptly
make full written disclosure to the Company, and hereby assign to the
Company, or its designee, all of Executive's right, title, and
interest in and to any and all Inventions, whether or not patentable,
that Executive may solely or jointly conceive or develop or reduce to
practice, or cause to be conceived or developed or reduced to
practice, during the period of time Executive is in the employ of the
Company (collectively referred to as "Company Inventions"). Executive
further acknowledges that all original works of authorship that are
created or contributed to by Executive (solely or jointly with others)
within the scope of and during the period of Executive's employment
with the Company are to be deemed "works made for hire," as that term
is defined in the United States Copyright Act (17 U.S.C. Section 101),
and the Company will own all right, title and interest in such works,
including all copyright and all intellectual property therein shall be
the sole property of the Company or its designee for all territories
of the world in perpetuity, including any and all copyright
registrations, copyright applications and all other copyrightable
materials, including any renewals and extensions thereof, and in and
to all works based upon, derived from, or incorporating the works
covered by such copyrights and in and to all income, royalties,
damages, claims, and payments now or hereinafter due or payable with
respect thereto, and in all causes of action, either in law or in
equity for past, present or future infringement based on said
copyrights, and in and to all rights corresponding to the foregoing
throughout the world. To the extent any of such works are deemed not
to be "works made for hire," Executive hereby assigns the copyright
and all other intellectual property rights in such works to the
Company.
(c) Contracts with the United States. Executive agrees to execute any
licenses or assignments as required by any contract between the
Company and the United States or any of its agencies.
(d) Maintenance of Records. Executive agrees to keep and maintain adequate
and current written records of all Company Inventions made by
Executive (solely or jointly with others) during the term and within
the scope of Executive's employment with the Company. The records will
be in the form of notes, sketches, drawings, and any other format that
may be specified by the Company. The records will be available to and
remain the sole property and intellectual property of the Company at
all times.
(e) Further Assurances. Executive covenants to take all requested actions
and execute all requested documents to assist the Company, or its
designee, at the Company's expense (but without further remuneration,
in every way to secure the Company's above rights in the Prior
Inventions and Company Inventions and any copyrights, patents, mask
work rights or other intellectual property rights relating thereto in
any and all countries, and to pursue any patents or registrations with
respect thereto. This covenant shall survive the termination of this
Agreement. If the Company is unable for any other reason to secure
Executive's signature on any document for this purpose, then Executive
hereby irrevocably designates and appoints the Company and its duly
authorized officers and agents as Executive's agent and attorney in
fact, to act for and in Executive's behalf and stead to execute any
documents and to do all other lawfully permitted acts in connection
with the foregoing.
8.3 Injunction. Executive acknowledges that monetary damages will not be an
adequate remedy for the Company in the event of a breach of this Article
VIII, and that it would be impossible for the Company to measure damages in
the event of such a breach. Therefore, Executive agrees that, in addition
to other rights that the Company may have, the Company is entitled to (i)
in the event of a breach by Executive of this Article VII that is not cured
within 10 days following written notice from the Company to the Executive
detailing such breach, cease making any payments or providing any benefit
otherwise required by this Agreement and/or (ii) an injunction preventing
Executive from any breach of this Article VIII.
Article IX.
MISCELLANEOUS
9.1 Mitigation. In no event shall Executive be obligated to seek other
employment or take any other action to mitigate the amounts payable to
Executive under any of the provisions of this Agreement, nor shall the
amount of any payment hereunder be reduced by any compensation earned as
result of Executive's employment by another employer.
9.2 Legal Fees. If Executive incurs legal or other fees and expenses in an
effort to secure or preserve establish entitlement to compensation and
benefits under this Agreement, the Company shall reimburse Executive for
such fees and expenses to the extent that the Executive substantially
prevails in such dispute.
9.3 Beneficiary. If Executive dies prior to receiving all of the amounts
payable to him in accordance with the terms of this Agreement, such amounts
shall be paid to one or more beneficiaries (each, a "Beneficiary")
designated by Executive in writing to the Company during his lifetime, or
if no such Beneficiary is designated, to Executive's estate. Such payments
shall be made in a lump sum to the extent so payable and, to the extent not
payable in a lump sum, in accordance with the terms of this Agreement.
Executive, without the consent of any prior Beneficiary may change his
designation of Beneficiary or Beneficiaries at any time or from time by a
submitting to the Company a new designation in writing.
9.4 Assignment; Successors. This Agreement shall not be assignable by
Executive. This Agreement may be assigned by the Company to a person or
entity that is a successor in interest to substantially all of the business
operations of the Company. Upon such assignment, the rights and obligations
of the Company hereunder shall become the rights and obligations of such
affiliate or successor person or entity. This Agreement shall be binding
and inure to the benefit of Executive, his estates and Beneficiaries, the
Company and the successors and permitted assigns of the Company.
9.5 Nonalienation. Benefits payable under this Agreement shall not be subject
in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance, charge, garnishment, execution or levy of any kind,
either voluntary or involuntary, prior to actually being received by
Executive or a Beneficiary, as applicable, and any such attempt to dispose
of any right to benefits payable hereunder shall be void.
9.6 Severability. If one or more of this Agreement are declared by any court or
government authority to be unlawful or invalid, such unlawfulness or
invalidity shall not invalidate any part of this Agreement no declared to
be unlawful or invalid. Any part so declared to be unlawful or invalid
shall, if possible, be construed in a manner that will give effect to the
terms of such part to the fullest extent possible while remaining lawful
and valid.
9.7 Withholding Taxes. The Company may withhold from any amounts payable under
this Agreement such Federal, state and local taxes as may be required to be
withheld pursuant to any applicable law or regulation.
9.8 Captions. The names of the Articles and Sections of this Agreement are for
convenience of reference only and do not constitute a part hereof.
9.9 Amendment; Waiver. This Agreement shall not be amended or modified except
by written instrument executed by the Company and Executive. A waiver of
any term, covenant or condition, and any waiver of any default in any such
term, covenant or condition shall not be deemed a waiver of any later
default thereof.
9.10.1 Notices. All notices hereunder shall be in writing and deliver by hand,
by nationally-recognized delivery service that guarantees overnight
delivery, or by first-class, registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:
If to the Company, to: Xxxxxx Packaging Company L.P.
0000 Xxxxxxxx Xxxxxx Xxxx
Xxxx, XX 00000
Attention: General Counsel
With a copy to: The Blackstone Group L.P.
000 Xxxx Xxxxxx, 00xx Xxxxx
XxxXxxx, XX 00000
Attention: Xxxxxx Xxxxxx
If to Executive to:
To the most recent address of Executive set forth in the personnel records of
the Company.
Either party may from time to time designate a new address by notice given in
accordance with this Section Notice shall be effective when actually received by
the addressee.
9.11 Counterparts. This Agreement may be executed in several counterparts, each
of which shall be deemed to be an original but all of which together will
constitute one and the same instrument.
9.12 Entire Agreement. This Agreement forms the entire agreement between the
parties hereto with respect to the subject matter contained in this
Agreement.
9.13 Applicable Law. This Agreement shall be interpreted and construed in
accordance with the laws of the Commonwealth of Pennsylvania, without
regard to its choice of law principles.
9.14 Survival of Executive's Rights. All of Executive's rights hereunder,
including his rights to compensation and benefits, and his obligations
under Section 8.1 hereof, shall survive the termination of Executive's
employment and/or the termination of this agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date first
above written.
Xxxxxx Packaging Company L.P.
-----------------------------
name:
title:
Executive
-----------------------------
XXXXXX PACKAGING COMPANY L.P.
AMENDMENT TO EMPLOYMENT AGREEMENT
This AMENDMENT TO EMPLOYMENT AGREEMENT (the "Amendment") dated as of the 11th
day of August 2003, is between Xxxxxx Packaging Company, L.P., a Delaware
Limited Partnership (the "Company") and Ashok Sudan (the "Executive").
WHEREAS, the Company and the Executive entered into a certain Employment
Agreement dated June 27, 2002 (the "Agreement"); and
WHEREAS, the Company and Executive now wish to amend the Employment Agreement as
set forth below and as approved by the Company's "Board" (as defined in the
Employment Agreement.
AMENDMENT
The Company and Executive hereby agree that the Company has increased
Executive's Salary effective as of August 11th 2003 and therefore that section
4.1 in the Agreement entitled "Salary" is amended such that Base Salary has been
increased to $ 236,500.00 per year, for all purposes under the Agreement.
Except as set forth above, the Employment Agreement remains in full force and
effect.
[SIGNATURES ON NEXT PAGE]
IN WITNESS WHEREOF, the parties have executed this Amendment as of the date
first written above.
XXXXXX PACKAGING COMPANY L.P.
By:
Name: ----------------------------
Title: ---------------------------
----------------------------------
Ashok Sudan
