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EXHIBIT 10.20
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement between ICO, INC., a
Texas corporation (the "Company"), and XXX X. XXXX (the "Executive") is dated
this 4th day of September, 1998.
RECITALS:
Executive currently serves as Senior Vice President and Treasurer of
the Company.
Executive executed an employment agreement with the Company on March
18, 1997.
The Company desires to execute an amended and restated employment
agreement with Executive that will supersede and replace the prior employment
agreement.
IT IS, THEREFORE, AGREED:
1. OPERATION OF AGREEMENT. The "Effective Date" shall be on the
date this Agreement is signed as indicated above.
2. EMPLOYMENT PERIOD. Unless sooner terminated pursuant to the
other provisions hereof, the Company agrees to employ Executive for a period
beginning with the Effective Date of this Agreement and terminating September
3rd , 2000. Said term of employment shall be extended automatically from day to
day until such time as either party shall give written notice to the other that
no further such automatic extensions shall occur, in which event Executive's
employment shall terminate on a date two years after such notice has been
received. As used herein, the term "Employment Period" shall mean the period
beginning on the Effective Date and ending on the date the Executive's
employment terminates.
3. POSITION AND DUTIES.
(a) During the Employment Period, Executive shall be
engaged as the Senior Vice President and Treasurer of the Company. In such
position, Executive shall have such duties and authority as are reasonably
accorded and expected of a Senior Vice President and Treasurer consistent with
the bylaws of the Company and shall have such other duties and authority as
shall be reasonably determined from time to time by the Board.
(b) Excluding periods of vacation and sick leave to which
the Executive is entitled, the Executive agrees to devote reasonable attention
and time during normal business hours to the business and affairs of the Company
and, to the extent necessary to discharge the responsibilities assigned to
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the Executive hereunder, to use reasonable best efforts to perform faithfully
and efficiently such responsibilities. The Company recognizes that Executive may
in the future serve as a director or as an officer of other companies, charities
and civic associations, and may be compensated in such capacities. Compensation
or remuneration received by the Executive as an officer or director of Pacholder
Associates, Inc. or other entity shall be retained by Executive in addition to
compensation provided under this Agreement.
4. COMPENSATION.
(a) Base Salary. During the Employment Period, the
Executive shall receive a base salary ("Base Salary") of $155,000 per annum
payable bi-weekly. During the Employment Period, the Base Salary shall be
reviewed at least annually and shall be increased at any time and from time to
time to reflect at a minimum increases in the cost of living and such other
increases as shall be consistent with increases in base salary awarded in the
ordinary course of business to other key executives. Any increase in the Base
Salary shall not serve to limit or reduce any other obligation to the Executive
under this Agreement. The Base Salary shall not be reduced after any such
increase.
(b) Annual Bonus. In addition to the Base Salary, the
Executive shall be awarded, for each fiscal year during the Employment Period,
an annual bonus (an "Annual Bonus") (either pursuant to a bonus or incentive
plan or program of the Company or otherwise) in cash in such amount as shall be
determined by the Board. Each such Annual Bonus shall be payable in January of
the fiscal year next following the fiscal year for which the Annual Bonus is
awarded, unless the Executive shall otherwise elect to defer the receipt of such
Annual Bonus.
(c) Incentive, Savings and Retirement Plans. In addition to
the Base Salary and Annual Bonus payable as hereinabove provided, the Executive
shall be entitled to participate, during the Employment Period, in all
incentive, savings and retirement plans and programs that may be adopted by the
Board for other key executives of the Company.
(d) Stock Options. In addition to the Base Salary and other
benefits accorded to Executive under this Agreement, Executive also shall be
entitled to receive stock options in the future under the Company's then
existing stock option plans in an amount and under such terms as the Board of
Directors or a committee thereof shall determine.
(e) Welfare Benefit Plans. During the Employment Period,
the Executive and/or the Executive's family, as the case may be, shall be
eligible for participation in and shall receive all benefits under each welfare
benefit plan of the Company, including, without limitation, all medical, dental,
disability, group life, accidental death and travel accident insurance plans and
programs of the Company, as in effect immediately preceding the Effective Date
or as in effect at any time thereafter with respect to other key executives.
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(f) Expenses. During the Employment Period, the Executive
shall be entitled to receive prompt reimbursement for all reasonable expenses
incurred by the Executive in accordance with the policies and procedures of the
Company as in effect immediately preceding the Effective Date or as in effect at
any time thereafter with respect to other key executives.
(g) Fringe Benefits. During the Employment Period, the
Executive shall be entitled to fringe benefits in accordance with the policies
of the Company as in effect immediately preceding the Effective Date or as in
effect at any time thereafter with respect to other key executives. Said
benefits shall include, but not be limited to, use at all times of a Company
vehicle. The Company shall be responsible for all maintenance, repairs and fuel
charges. The vehicle shall be a BMW 528i or a comparable vehicle, to be replaced
as reasonably necessary.
(h) Office and Support Staff. During the Employment Period,
the Executive shall be entitled to an office or offices of a size and with
furnishings and other appointments, and to secretarial and other assistance, at
least equal to those provided to the Executive immediately preceding the
Effective Date or as provided at any time thereafter with respect to other key
executives.
(i) Vacation. During the Employment Period, the Executive
shall be entitled to annual paid vacation that in no event shall be less than
four weeks per year.
5. TERMINATION.
(a) Death or Disability. This Agreement shall terminate
automatically upon the Executive's death. The Company may terminate this
Agreement, after having established the Executive's Disability (pursuant to the
definition of "Disability" set forth below), by giving to the Executive written
notice of its intention to terminate the Executive's employment. In such a case,
the Executive's employment with the Company shall terminate effective on the
90th day after receipt of such notice (the "Disability Effective Date"),
provided that, within 90 days after such receipt, the Executive shall fail to
return to full-time performance of the Executive's duties. For purposes of this
Agreement, "Disability" means disability which, after the expiration of more
than 26 weeks after its commencement, is determined to be total and permanent by
a physician selected by the Company or its insurers and acceptable to the
Executive or the Executive's legal representative (such agreement to
acceptability not to be withheld unreasonably).
(b) Cause. The Company may terminate the Executive's
employment for "Cause." For purposes of this Agreement, "Cause" means (i) an act
or acts of dishonesty taken by the Executive and intended to result in
substantial personal enrichment of the Executive at the expense of the Company
or (ii) repeated violations by the Executive of the Executive's obligations
under Section 3 of this Agreement which are demonstrably willful and deliberate
on the Executive's part and which result in material injury to the Company. If
the Company wishes to terminate the Executive's employment pursuant to clause
(ii) above, the Company shall first give written notice of its intention to the
Executive which notice shall set forth in reasonable detail the repeated
violations which are alleged by
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the Company, and the Executive shall have a 30-day period in which to cure such
violations prior to the expiration of which he may not be terminated pursuant to
such clause (ii).
(c) Good Reason. The Executive's employment may be
terminated by the Executive for Good Reason. For purposes of this Agreement,
"Good Reason" means
(i) Executive ceasing for any reason to be the
Senior Vice President and Treasurer of the Company, other than by
death, disability or termination by the Executive of employment with
the Company other than for Good Reason;
(ii) (A) the assignment to the Executive of any
duties inconsistent in any respect with the Executive's position
(including status, offices, titles and reporting requirements),
authority, duties or responsibilities as contemplated by Section 3 of
this Agreement or (B) any other action by the Company which results in
a diminishment in such position, authority, duties or responsibilities,
other than an insubstantial and inadvertent action which is remedied by
the Company promptly after receipt of notice thereof given by the
Executive;
(iii) any failure by the Company to comply with any
of the provisions of Section 4 of this Agreement, other than an
insubstantial and inadvertent failure which is remedied by the Company
promptly after receipt of notice thereof given by the Executive;
(iv) the Company's requiring the Executive to be
based at any office or location outside the greater Houston
metropolitan area, except for travel reasonably required in the
performance of the Executive's responsibilities;
(v) any purported termination by the Company of
the Executive's employment otherwise than as permitted by this
Agreement, it being understood that any such purported termination
shall not be effective for any purpose of this Agreement;
(vi) any failure by the Company to comply with and
satisfy Section 11(c) of this Agreement; or
(vii) if Executive shall no longer be employed by
the Company for any reason within two years after the occurrence of a
"Change of Control."
For the purpose of this Agreement, a "Change of Control" shall mean a
change of control of the Company during the Employment Period (as defined in
Section 3 below) of a nature that would be required to be reported in response
to Item 1(a) of the Current Report on Form 8-K, as in effect on the date hereof,
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 0000 (xxx
"Xxxxxxxx Xxx"); provided that, without limitation, such a "Change of Control"
shall be deemed to have occurred if:
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(i) (A) the Company shall not be the surviving
entity in any merger, xxxxxxx dation or other transaction (or survives
only as a subsidiary of an entity other than a previously wholly-owned
subsidiary of the Company) or (B) the shareholders of the Company prior
to any such merger, consolidation or other transaction do not continue
to own at least 60% of the surviving entity;
(ii) the Company sells, leases or exchanges all or
substantially all of its assets to any other person or entity (other
than a wholly-owned subsidiary of the Company);
(iii) the Company is materially or completely
liquidated;
(iv) a third person, including a "group" as such
term is used in Section 13(d)(3) of the Exchange Act, becomes the
beneficial owner, directly or indirectly, of (A) 50% or more of the
combined voting power of the Company's outstanding voting securities
ordinarily having the right to vote for the election of directors of
the Company or (B) 20% or more of the combined voting power of the
Company's outstanding voting securities ordinarily having the right to
vote for the election of directors of the Company if such acquisition
is not approved by the Board of Directors then in office immediately
prior to the acquisition;
(v) any person (other than the Company) purchases
any voting securities of the Company in a tender or exchange offer with
the intent, express or implied, of purchasing or otherwise acquiring
voting control of the Company; or
(vi) during any consecutive two-year period,
individuals who constituted the Board of Directors of the Company
(together with any new directors whose election by the Board of
Directors or whose nomination for election by the Shareholders of the
Company was approved by a vote of at least three-quarters of the
directors still in office who were either directors at the beginning of
such period or whose election or nomination for election was previously
so approved) cease for any reason to constitute a majority of the Board
of Directors then in office.
For purposes of this Section 6(c), any good faith determination of
"Good Reason" made by the Executive shall be conclusive.
(d) Notice of Termination. Any termination by the Company
for Cause or by the Executive for Good Reason shall be communicated by Notice of
Termination to the other party hereto given in accordance with Section 12(b) of
this Agreement. For purposes of this Agreement, a "Notice of Termination" means
a written notice which (i) indicates the specific termination provision in this
Agreement relied upon, (ii) sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated and (iii) if the termination date is
other than the date of receipt of such notice, specifies the termination date
(which date shall be not more than 15 days after the giving of such notice).
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(e) Date of Termination. "Date of Termination" means the
date of receipt of the Notice of Termination or any later date specified
therein, as the case may be. If the Executive's employment is terminated by the
Company in breach of this Agreement, the Date of Termination shall be the date
on which the Company notifies the Executive of such termination.
6. OBLIGATIONS OF THE COMPANY UPON TERMINATION.
(a) Death. If the Executive's employment is terminated by
reason of the Executive's death, this Agreement shall terminate without further
obligations to the Executive's legal representatives under this Agreement other
than those obligations accrued hereunder at the date of the Executive's death or
as specified in this paragraph. Anything in this Agreement to the contrary
notwithstanding, the Executive's family shall be entitled to receive benefits at
least equal to those provided by the Company to surviving families of executives
of the Company under such plans, programs and policies relating to family death
benefits, if any, as in effect at any time during the 90- day period immediately
preceding the Effective Date or, if more favorable to the Executive and/or the
Executive's family, as in effect at any time thereafter with respect to other
key executives and their families. In addition, any previously granted unvested
options received by the Executive pursuant to any stock option plans of the
Company prior to his death shall become immediately vested and fully exercisable
by Executive's estate for the full term of the original grant of the option or
options to the extent permissible by the option plan or plans, notwithstanding
any provisions regarding exercisability provided therein.
(b) Disability. If the Executive's employment is terminated
by reason of the Executive's Disability, the Executive shall be entitled after
the Disability Effective Date to his Base Salary for a two-year period
commencing with the Disability Effective Date and shall receive such other
benefits at least equal to those provided by the Company to disabled employees
and/or their families in accordance with such plans, programs and policies
relating to disability, if any, as in effect during the 90-day period
immediately preceding the Effective Date or, if more favorable to the Executive
and/or the Executive's family, as in effect at any time thereafter with respect
to other key executives and their families. In addition, any previously granted
unvested options received by the Executive pursuant to any stock option plans of
the Company prior to Executive's Disability shall become immediately vested and
fully exercisable by Executive or his estate for the full term of the original
grant of the option or options to the extent permissible by the option plan or
plans, notwithstanding any provisions regarding exercisability provided therein.
(c) Cause. If the Executive's employment shall be
terminated for Cause, the Company shall pay the Executive his full Base Salary
through the Date of Termination at the rate in effect at the time Notice of
Termination is given and shall have no further obligations to the Executive
under this Agreement.
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(d) Good Reason; Other Than for Cause or Disability. If,
during the Employment Period, the Company shall terminate the Executive's
employment other than for Cause or Disability, or the employment of the
Executive shall be terminated by the Executive for Good Reason:
(i) the Company shall pay to the Executive in a
lump sum in cash within 10 days after the Date of Termination the
aggregate of the following amounts:
(A) if not theretofore paid, the Executive's
Base Salary through the Date of Termination at the rate in
effect on the Date of Termination;
(B) the product of (x) the greater of the
highest Annual Bonus paid to the Executive during the
Employment Period and 50% of the Executive's Base Salary in
the year of termination and (y) the fraction obtained by
dividing (i) the number of days which Executive has been
employed during the particular year in which termination
occurs by (ii) 365; and
(C) two times the sum of (x) the Executive's
annual Base Salary at the rate in effect at the time Notice of
Termination was given and (y) the greater of the highest
Annual Bonus paid to the Executive during the Employment
Period and 50% of the Executive's Base Salary during the
particular fiscal year in which termination occurs;
(ii) any previously granted unvested options
received by Executive pursuant to any stock option plans of the Company
prior to such termination shall become immediately vested and fully
exercisable by Executive or by Executive's estate for the full term of
the original grant of the option or options to the extent permissible
by the option plan or plans, notwithstanding any provisions to the
contrary provided in such stock option plans or agreements;
(iii) the Company shall, promptly upon submission
by the Executive of supporting documentation, pay or reimburse to the
Executive any costs and expenses (including moving and relocation
expenses) paid or incurred by the Executive which would have been
payable under Section 4(f) if the Executive's employment had not
terminated; and
(iv) for a period of two years after the Date of
Termination, the Company shall continue benefits to the Executive
and/or the Executive's family at least equal to those which would have
been provided to them in accordance with the plans, programs and
policies described in Sections 4(e) and 4(g) of this Agreement (or, if
more favorable to Executive, as in effect at any time thereafter with
respect to other key employees) if the Executive's employment had not
been terminated.
7. NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement shall
prevent or limit the Executive's continuing or future participation in any
benefit, bonus, incentive or other plan or program provided by the Company or
any of its affiliated companies and for which the Executive may qualify,
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nor shall anything herein limit or otherwise affect such rights as the Executive
may have under any stock option or other agreements with the Company or any of
its affiliated companies. Amounts which are vested benefits or which the
Executive is otherwise entitled to receive under any plan or program of the
Company or any of its affiliated companies at or subsequent to the Date of
Termination shall be payable in accordance with such plan or program.
8. FULL SETTLEMENT. The Company's obligation to make the payments
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, recoupment, defense or other right which
the Company may have against the Executive or others. In no event shall the
Executive be obligated to seek other employment by way of mitigation of the
amounts payable to the Executive under any of the provisions of this Agreement.
The Company agrees to pay, to the full extent permitted by law, all legal fees
and expenses which the Executive may reasonably incur as a result of any contest
(regardless of the outcome thereof) by the Company or others of the validity or
enforceability of, or liability under, any provision of this Agreement or any
guarantee of performance thereof or as a result of any contest by the Executive
against the amount of any payment pursuant to Section 9 of this Agreement, plus
in each case interest, compounded quarterly, on the total unpaid amount
determined to be payable under this Agreement, such interest to be calculated at
a rate equal to 2% in excess of the prime commercial lending rate published in
the Wall Street Journal in effect from time to time during the period of such
nonpayment.
9. CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY. Notwithstanding
anything to the contrary in this Agreement, in the event that any payment or
distribution by the Company to or for the benefit of Executive, whether paid or
payable or distributed or distributable pursuant to the terms of this Agreement
or otherwise (a "Payment") would be subject to the excise tax imposed by Section
4999 of the Internal Revenue Code of 1986, as amended, or any interest or
penalties with respect to such excise tax (such excise tax, together with any
such interest or penalties, are hereinafter collectively referred to as the
"Excise Tax"), the Company shall pay to Executive an additional payment (a
"Gross-up Payment") in an amount such that after payment by Executive of all
taxes (including any interest or penalties imposed with respect to such taxes),
including any Excise Tax imposed on any Gross-up Payment, Executive retains an
amount of the Gross-up Payment equal to the Excise Tax imposed upon the
Payments. The Company and Executive shall make an initial determination as to
whether a Gross-up Payment is required and the amount of any such Gross-up
Payment. Executive shall notify the Company immediately in writing of any claim
by the Internal Revenue Service which, if successful, would require the Company
to make a Gross-up Payment (or a Gross-up Payment in excess of that, if any,
initially determined by the Company and Executive) within five days of the
receipt of such claim. The Company shall notify Executive in writing at least
five days prior to the due date of any response required with respect to such
claim if it plans to contest the claim. If the Company decides to contest such
claim, Executive shall cooperate fully with the Company in such action;
provided, however, the Company shall bear and pay directly or indirectly all
costs and expenses (including additional interest and penalties) incurred in
connection with such action and shall indemnify and hold Executive harmless, on
an after-tax basis, for any Excise Tax or income tax,
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including interest and penalties with respect thereto, imposed as a result of
the Company's action. If, as a result of the Company's action with respect to a
claim, Executive receives a refund of any amount paid by the Company with
respect to such claim, Executive shall promptly pay such refund to the Company.
If the Company fails to timely notify Executive whether it will contest such
claim or the Company determines not to contest such claim, then the Company
shall immediately pay to Executive the portion of such claim, if any, which it
has not previously paid to Executive.
10. CONFIDENTIAL INFORMATION. The Executive shall hold in a fiduciary
capacity for the benefit of the Company all secret or confidential information,
knowledge or data relating to the Company or any of its affiliated companies,
and their respective businesses, which shall have been obtained by the Executive
during the Executive's employment by the Company and which shall not be public
knowledge (other than by acts by the Executive or her representatives in
violation of this Agreement). After termination of the Executive's employment
with the Company and continuing for a period of one year, the Executive shall
not, without the prior written consent of the Company, communicate or divulge
any such information, knowledge or data to anyone other than the Company and
those designated by it. In no event shall an asserted violation of the
provisions of this Section 10 constitute a basis for deferring or withholding
any amounts otherwise payable to the Executive under this Agreement.
11. SUCCESSORS.
(a) This Agreement is personal to the Executive and without
the prior written consent of the Company shall not be assignable by the
Executive otherwise than by will or the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal representatives.
(b) This Agreement shall inure to the benefit of and be
binding upon the Company and its successors.
(c) In the event of a Change of Control, any parent company
or successor shall, in the case of a successor, by an agreement in form and
substance satisfactory to the Executive, expressly assume and agree to perform
this Agreement and, in the case of a parent company, by an agreement in form and
substance satisfactory to the Executive, guarantee and agree to cause the
performance of this Agreement, in each case, in the same manner and to the same
extent as the Company would be required to perform if no Change of Control had
taken place.
12. MISCELLANEOUS.
(a) This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas, 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
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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:
Xxx X. Xxxx
0000 Xxxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
If to the Company:
ICO, Inc.
00000 Xxxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
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 or local taxes as shall be required to be
withheld pursuant to any applicable law or regulation.
(e) This Agreement contains the entire understanding of the
Company and the Executive with respect to the subject matter hereof.
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IN WITNESS WHEREOF, the Executive has hereunto set his hand and,
pursuant to the authorization from its Board of Directors, the Company has
caused these presents to be executed in its name on its behalf, all as of the
day and year first above written.
/s/ Xxx X. Xxxx
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XXX X. XXXX
ICO, INC.
By /s/ Xx X. Xxxxxxxxx
------------------------------------
Name:
Title:
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