EXHIBIT 10.26
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is made as of July 31, 2000
by and between United Stationers Inc., a Delaware corporation ("Parent
Company") United Stationers Supply Co., an Illinois corporation (the
"Company") and Xxxxxx Xxxxxxxx ("Xxxxxxxx").
In consideration of the mutual promises and agreements contained in
this Agreement, the Company hereby employs Xxxxxxxx and Xxxxxxxx accepts
employment with the Company on the terms and conditions in this Agreement.
1. TERM OF EMPLOYMENT. The Company hereby agrees to employ
Xxxxxxxx and Xxxxxxxx hereby accepts employment, in accordance with the terms
and conditions set forth herein, commencing October 1, 2001 or sooner upon
mutual agreement with the Company and Xxxxxxxx (collectively, the "Effective
Date"). The period of Xxxxxxxx'x employment hereunder is referred to herein
as the "Employment Term". Xxxxxxxx and the Company understand and acknowledge
that Xxxxxxxx'x employment with the Company constitutes "at will" employment.
Subject to the Company's obligation to provide severance benefits as
specified herein in Section 7 of this Agreement, Xxxxxxxx and the Company
acknowledge that this employment relationship may be terminated at any time,
upon written notice to the other party, with or without Cause or Good Reason
and for any or no cause or reason, at the option of either Xxxxxxxx with
sixty days written notice to the Company or the Company.
2. POSITION AND DUTIES. During the Employment Term, Xxxxxxxx
shall serve as Chief Financial Officer and Executive Vice President of the
Company reporting to the Chief Executive Officer, and, in accordance with the
authority and direction of the Chief Executive Officer, the boards of
directors of the Company and/or United Stationers Inc. (the "Board") shall
render such operational, administrative and other services to the Company as
may be required of such position or as the CEO or either Board may from time
to time direct commensurate with such position and title. Xxxxxxxx shall be
available at all reasonable times for consultation with both Boards on
matters relating to the Company's or its affiliates' business.
Xxxxxxxx shall, during normal working hours and at such other times
as Xxxxxxxx'x duties may reasonably require, devote her best efforts and
substantially all of her time and attention (except for reasonable periods of
vacation, illness or other incapacity) to the business and affairs of the
Company and its affiliates.
3. COMPENSATION. During the Employment Term, Xxxxxxxx shall be
compensated as follows:
3.1 BASE SALARY. Xxxxxxxx shall receive a base salary of no less
than $325,000 per year ("Base Level"), payable in accordance with the
Company's normal payment schedule for management employees. The base salary
shall be reviewed by the Board annually and may, in the Board's sole
discretion, be increased when deemed appropriate, but, may not be decreased
below the Base Level, or except pursuant to a general decrease in base
salaries overall for senior
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level management executives, the base salary received by Xxxxxxxx during the
immediately preceding calendar year of the Employment Term, whichever is
greater; provided, however, in no circumstances may Xxxxxxxx'x base salary
ever be decreased below the Base Level.
3.2 BONUS. Xxxxxxxx shall be eligible to participate in any bonus
plans approved by the Board and made generally available to senior management
employees of the Company, and shall be entitled to and paid such bonus
amounts as shall be determined in accordance with such plans. For the first
year of the Employment Term, Xxxxxxxx'x bonus shall be in an amount not less
than $111,600.00.
3.3 BENEFITS. Xxxxxxxx shall be included, to the extent eligible,
in all plans, programs and policies providing general benefits for the
Company's employees and/or its senior management employees (as approved by
either Board and in effect from time to time). Summaries of all plans,
programs and policies providing general benefits for the Company's employees
and/or senior management currently in effect are attached hereto as Schedule
3.3 and incorporated herein by this reference. This paragraph shall not be
construed to require the Company to establish or maintain any policy, plan or
program.
3.4 STOCK GRANT. As an inducement to enter into this Agreement,
Xxxxxxxx shall be granted effective as of the Effective Date 11,500 shares of
common stock of United Stationers Inc. ("Restricted Shares"), subject to
restrictions as set forth in this Section. The Restricted Shares shall vest
on the fourth anniversary of the Effective Date, if Xxxxxxxx remains employed
by the Company through the fourth anniversary of the Effective Date. In
addition, if the termination of Xxxxxxxx'x employment by the Company without
Cause, by Xxxxxxxx for Good Reason or by reason of Xxxxxxxx'x death or
Disability occurs prior to the fourth anniversary of the Effective Date, the
Restricted Shares shall immediately vest on such termination of employment.
If Xxxxxxxx ceases to be an employee of the Company for any reason other than
termination of employment by the Company without Cause, by Xxxxxxxx for Good
Reason or the death or Disability of Xxxxxxxx prior to the fourth anniversary
of the Effective Date, then all Restricted Shares shall be forfeited and
reconveyed to the United Stationers Inc. by Xxxxxxxx without additional
consideration and Xxxxxxxx shall have no further rights with respect thereto.
Xxxxxxxx shall have no right to transfer any of the Restricted Shares until
they vest pursuant to this Section 3.4. For purposes of this Agreement, the
term "transfer" shall include any sale, exchange, assignment, gift,
encumbrance, lien, transfer by bankruptcy or judicial order, transfer by
operation of law and all other types of transfers and dispositions, whether
direct or indirect, voluntary or involuntary.
The certificate representing the Restricted Shares, together with a stock
power duly endorsed in blank by Xxxxxxxx, shall be deposited with the Company
to be held by it until the restrictions imposed upon the Restricted Shares by
this Agreement have expired. The certificate representing the Restricted
Shares shall bear the following legend: "The sale or other transfer of shares
represented by this Certificate, whether voluntary, involuntary or by
operation of law, is subject to certain restrictions on transfer as set forth
in the Employment Agreement between United Stationers Inc., United Stationers
Supply Co. and Xxxxxx Xxxxxxxx dated July 31, 2000." When the Restricted
Shares become vested, Xxxxxxxx shall have the right to have the preceding
legend removed from the certificate representing such vested Restricted
Shares.
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3.5 STOCK OPTIONS.
3.5.1 INITIAL OPTION. As an inducement to enter into this Agreement,
Xxxxxxxx shall be granted effective as of the Effective Date an option
("Initial Option") to purchase 5,000 shares of common stock of United
Stationers Inc. with an exercise price of $25 per share and subject to
the terms and conditions set forth herein:
(a) The Initial Option shall become fully exercisable on the fourth
anniversary of the Effective Date if Xxxxxxxx remains employed with
the Company through the fourth anniversary of the Effective Date;
provided that the Initial Option shall immediately become fully
exercisable upon termination of Xxxxxxxx'x employment by the
Company without Cause (as defined in Section 7.3) or by Xxxxxxxx
with Good Reason (as defined in Section 7.2).
(b) The other terms and conditions of the Initial Option shall be the
terms and conditions applicable to options granted to executive
officers in July, 1999 pursuant to the Management Equity Plan.
3.5.2 2000 OPTION. The Human Resources Committee of the Board of
Directors of United Stationers Inc. has also approved a grant to
Xxxxxxxx of an option ("2000 Option") to purchase 40,000 shares of
common stock of United Stationers Inc. The 2000 Option shall be granted
to Xxxxxxxx on the later of the Effective Date or the date option
grants are first made after the date hereof to other executive officers
under the 2000 Management Equity Plan. The per share exercise price
shall be the fair market value of the shares, as determined by the
Committee under the 2000 Management Equity Plan, on the date of the
grant of the 2000 Option. The other terms and conditions of the 2000
Option shall be the terms and conditions applicable to options grants
first made after the date hereof to other executive officers under the
2000 Management Equity Plan.
3.6 VACATION. Xxxxxxxx, commencing with the first year of the
Employment Term and during each calendar year of the Employment Term
thereafter, shall be entitled to at least twenty (20) paid vacation days
(being at least four (4) weeks) per calendar year which shall be subject to
the Company's vacation policies from time to time in effect for its senior
level management executives.
3.7 REIMBURSEMENT OF BUSINESS EXPENSES. During the Employment Term,
Xxxxxxxx is authorized to incur reasonable business expenses in carrying out
her duties and responsibilities under this Agreement, and the Company shall
reimburse her for all such business expenses reasonably incurred by her in
connection with the carrying on of the business of the Company, subject to
documentation in accordance with the Company's reimbursement policies, from
time to time in effect.
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4. CONFIDENTIAL INFORMATION AND PROPRIETARY MATERIAL.
4.1 CONFIDENTIAL INFORMATION. Xxxxxxxx acknowledges the Company's
exclusive ownership of all information useful in the business of the Company,
its parents, subsidiaries or affiliates (collectively "United") (including
dealings with suppliers, customers and other third parties, whether or not a
true "trade secret"), which at the time or times concerned is not generally
known to persons engaged in businesses similar to those conducted by United,
and which has been or is from time to time disclosed to, discovered by, or
otherwise known by Xxxxxxxx as a consequence of her employment by the Company
(including information conceived, discovered or developed by Xxxxxxxx during
her employment with the Company) (collectively, "Confidential Information").
Confidential Information includes, but is not limited to the following
especially sensitive types of information:
(a) The identity, purchase and payment patterns of, and special
relations with, the customers of United;
(b) The identity, net prices and credit terms of, and special
relations with, the suppliers of United;
(c) The inventory selection and management techniques of United;
(d) The product development and marketing plans of United;
(e) The strategic business plans of United; and
(f) The finances of United, except to the extent publicly disclosed.
4.2 PROPRIETARY MATERIALS. The term "Proprietary Materials" shall
mean all business records, documents, drawings, writings, software, programs
and other tangible things which were or are created or received by or for
United in furtherance of its business, including, but not limited to, those
which contain Confidential Information. For example, Proprietary Materials
include, but are not limited to, the following especially sensitive types of
materials: applications software, the data bases of Confidential Information
maintained in connection with such software, and printouts generated from
such data bases, market studies and strategic plans; customer, supplier and
employee lists; contracts and correspondence with customers and suppliers;
documents evidencing transactions with customers and suppliers; sales calls
reports, appointment books, calendars, expense statements and the like,
reflecting conversations with any company, customer or supplier;
architectural plans; and purchasing, sales and policy manuals. Proprietary
Materials also include, but are not limited to, any such things which are
created by Xxxxxxxx or with Xxxxxxxx'x assistance and all notes, memoranda
and the like prepared using the Proprietary Materials and/or Confidential
Information.
4.3 ACKNOWLEDGEMENTS AND UNDERTAKINGS. Xxxxxxxx acknowledges that
the Proprietary Materials has or will cost the Company a great effort and
expense, and affords persons to whom Proprietary Materials are disclosed,
including Xxxxxxxx, a competitive
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advantage over persons who do not know the information or have the
compilation of the Proprietary Materials. Xxxxxxxx further acknowledges that
Confidential Information and Proprietary Materials include commercially
valuable trade secrets and automatically become the Company's exclusive
property when they are conceived, created or received. Xxxxxxxx shall report
to the Company fully and promptly, orally (or, at the Company's request, in
writing) all discoveries, inventions and improvements, whether or not
patentable, and all other ideas, developments, processes, techniques, designs
and other information which may be of benefit to United, which Xxxxxxxx
conceives, makes or develops during her employment (whether or not during
working hours or with use or assistance of Company's facilities, materials or
personnel), and which either (i) relate to or arise out of any part of
United's business in which Xxxxxxxx participates, or (ii) incorporate or make
use of Confidential Information or Proprietary Materials (all items referred
to in this Section 4.3 being sometimes collectively referred to herein as the
"Intellectual Property"). All Intellectual Property shall be deemed
Confidential Information of the Company, and any writing or other tangible
things describing, referring to, or containing Intellectual Property shall be
deemed the Company's Proprietary Materials. At the request of the Company,
during or after the term of employment, Xxxxxxxx (or after Xxxxxxxx'x death,
Xxxxxxxx'x personal representative) shall, at the expense of the Company,
make, execute and deliver all papers, assignments, conveyances, installments
or other documents, and perform or cause to be performed such other lawful
acts, and give such testimony, as the Company deems necessary or desirable to
protect United's ownership rights and Intellectual Property.
4.4 CONFIDENTIALITY DUTIES. Xxxxxxxx shall, except as may be
required by law, during the term of employment, and thereafter for the
longest time permitted by applicable law:
4.4.1 Comply with all the Company's instructions (whether oral or
written) for preserving the confidentially of Confidential Information
and Proprietary Materials.
4.4.2 Use Confidential Information and Proprietary Materials only in
furtherance of United's business, and pursuant to the Company's
directions.
4.4.3 Exercise appropriate care to advise other employees of the
Company (and, as appropriate, subcontractors) of the sensitive nature
of Confidential Information and Proprietary Materials prior to their
disclosure, and to disclose the same only on a need-to-know basis.
4.4.4 Not copy all or any part of Proprietary Materials, except as
the Company directs.
4.4.5 Not sell, give, loan or otherwise transfer any copy of all or
any part of Proprietary Materials to any person who is not an employee
of the Company, except as the Company directs.
4.4.6 Not publish, lecture on or otherwise disclose to any person
who is not an employee of the Company, except as the Company directs,
all or any part of Confidential Information or Proprietary Materials.
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4.4.7 Not use all or any part of any Confidential Information or
Proprietary Materials for the benefit of any third party without the
Company's written consent.
Upon the termination of Xxxxxxxx'x employment for whatever reason,
Xxxxxxxx, (or in the event of death, Xxxxxxxx'x personal representative),
shall promptly surrender to the Company the original and all copies of
Proprietary Materials (including all notes, memoranda and the like concerning
or derived therefrom), whether prepared by Xxxxxxxx or others, which are then
in Xxxxxxxx'x possession or control. Records of payments made by the Company
to or for the benefit of Xxxxxxxx, Xxxxxxxx'x copy of this Agreement and
other such things, lawfully possessed by Xxxxxxxx to the extent relating
solely to taxes payable by Xxxxxxxx, employee benefits due to Xxxxxxxx or the
terms of Xxxxxxxx'x employment with the Company, shall not be deemed
Proprietary Materials for purposes of this Section 4.
5. NON-COMPETITION AND NONSOLICITATION.
5.1 NONCOMPETE. During Xxxxxxxx'x Employment Term, and during the
two year period following her employment, Xxxxxxxx shall not, in any way,
directly or indirectly, manage, operate, control (or participate in any of
the foregoing), accept employment or a consulting position with or otherwise
advise or assist or be connected with or directly or indirectly own or have
any other interest in or right with respect to (other than through ownership
of not more than 1% of the outstanding shares of a corporation's stock which
is listed on a national securities exchange) any enterprise (other than for
the Company or for the benefit of the Company) which is a wholesaler or
retailer of office products having annual sales in excess of $1,000,000 or
any other business in which United, during the Employment Term, may be
actively involved or have plans to become actively involved.
5.2 MANUFACTURING OF OFFICE PRODUCTS. Notwithstanding Section 5.1,
following the Employment Term, Xxxxxxxx may be engaged by any company whose
principal business is the manufacture of office products.
5.3 NONSOLICITATION. During Xxxxxxxx'x Employment Term and during
the two-year period following her employment, Xxxxxxxx shall not at any time,
directly or indirectly, solicit (1) any client or customer of United with
whom she had contact while employed by the Company for the purpose of causing
such client or customer to change its business relationship with United;
provided, however, nothing herein is intended nor should such be construed as
precluding Xxxxxxxx from responding to unsolicited client or customer
inquiries at any time, or (2) except for receiving and following up on
publicly placed employment advertisements, any employee of United for the
purposes of causing such employee to terminate employment with United.
5.4 LIMITATIONS. Xxxxxxxx recognizes that the foregoing limitations
are reasonable and properly required for the adequate protection of the
business of the Company. If any such limitations are deemed unreasonable by a
court having jurisdiction of the matter and parties, Xxxxxxxx hereby agrees
and submits to the reduction of any such limitations to such territory or
time as to such court shall appear reasonable.
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5.5 REMEDIES. Xxxxxxxx agrees that the remedy at law for any breach
of the provisions of Section 4 or this Section 5 shall be inadequate and that
the Company shall be entitled to injunctive relief in addition to any other
remedies it may have.
6. MUTUAL NON-DISPARAGEMENT. During and after the Employment Term:
6.1 Xxxxxxxx shall not, directly or indirectly, make or cause to be
made and shall not intentionally cause the officers, directors, employees,
agents and representatives of any entity or person controlled by Xxxxxxxx to
make or cause to be made, any disparaging, denigrating, derogatory or other
negative or false statement orally or in writing to any person or entity
about the Company, its or their respective parents, subsidiaries or
affiliates, its or their respective executive officers or members of its or
their boards of directors, or the business strategy or plans, policies,
practices or operations of the Company, or of its or their respective
parents, subsidiaries or affiliates. Xxxxxxxx shall not, directly or
indirectly, and shall, within her reasonable ability to control, cause the
officers, directors, employees, agents and representatives of any entity or
person controlled by Xxxxxxxx not to, directly or indirectly, dissipate or
negatively affect the goodwill, business, prospects or reputation of United
or its relationships with its employees, customers, suppliers, competitors,
vendors, stockholders, lenders, prospective investors or prospective
purchasers of any businesses or assets of United.
6.2 The Company shall not, directly or indirectly, make or
cause to be made, and shall not intentionally cause the officers, directors,
employees, agents or representatives of any entity or person controlled by
the Company or by which the Company is controlled, make or cause to be made,
any disparaging, denigrating, derogatory or other negative or false statement
orally or in writing to any person or entity about Xxxxxxxx, any entity
controlled by or with which Xxxxxxxx is affiliated, or any business plans,
policies, practices or reputation of Xxxxxxxx or any entity controlled by or
with which she is affiliated. The Company shall not, directly or indirectly,
and shall within its reasonable ability to control, cause the officers,
directors, employees, agents and representatives of the Company, its Parent
Company, subsidiaries, and affiliates and their respective executive officers
and members of their respective Boards of Directors not to, directly or
indirectly, dissipate or negatively affect the good will, business, prospects
or reputation of Xxxxxxxx or any entity controlled by her or with which she
is affiliated.
7. TERMINATION AND SEVERANCE.
7.1 RESIGNATION. If Xxxxxxxx resigns other than for Good Reason as
defined in Section 7.2, she shall be entitled to receive only the unpaid
portion of her base salary and accrued vacation attributable to and including
the date of resignation, and reimbursement for reasonable reimbursable
expenses incurred on behalf of the Company prior to the date of termination.
7.2 BY XXXXXXXX FOR GOOD REASON. Xxxxxxxx may elect to terminate her
employment by written notice to the Company within 60 days after the
occurrence of any of the following events without Xxxxxxxx'x consent, any of
which shall be deemed "Good Reason".
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(a) the reduction of Xxxxxxxx'x base salary contrary to the provisions
of this Agreement;
(b) the exclusion of Xxxxxxxx from, or diminution in Xxxxxxxx'x
participation in, any pension, bonus, management incentive, profit
sharing and other similar incentive, compensation or deferred
compensation plans made available to employees of the Company or to
officers or management personnel of the Company at the level of
vice president or lower, other than exclusions, changes or
diminutions applicable to all employees or such management
personnel or officers;
(c) any material diminution in expense reimbursement benefits enjoyed
by Xxxxxxxx during the Employment Term except pursuant to a general
change in the Company's reimbursement policies for its senior level
management executives;
(d) any material reduction in Xxxxxxxx'x duties, provided, however,
that any change in the office or officer to whom Xxxxxxxx reports,
shall not be deemed "Good Reason";
(e) any relocation of the Company's headquarters or transfer to
Xxxxxxxx to a location outside of the Chicago Metropolitan area;
or
(f) the material breach by the Company of any of its covenants or
obligations under this Agreement which is not promptly cured after
notice from Xxxxxxxx.
If the employment is terminated by Xxxxxxxx for Good Reason, and Xxxxxxxx
executes a general release substantially in the form attached hereto as
Exhibit "1", Xxxxxxxx shall be entitled to receive and the Company shall pay:
(a) the unpaid portion of her base salary and accrued vacation
attributable to and including the date of termination;
(b) reimbursement for reasonable business expenses incurred by her on
behalf of the Company prior to the date of termination;
(c) A severance amount equal to two year's base salary at the level
then in effect immediately prior to such termination, plus an
amount equal to her bonus earned from the Company for the year
preceding the year in which notice is given by Xxxxxxxx to the
Company (collectively, "Severance Benefit"), payable in equal
installments on the Company's regular pay schedule, commencing
within 30 days after receipt by the Company of written notice
from Xxxxxxxx of termination and continuing for 24 months, except
as provided in Section 7.6; and
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(d) Health care coverage for medical and dental benefits comparable to
that in effect for Xxxxxxxx and her qualified dependents
immediately prior to such termination at no cost to Xxxxxxxx for
two years following such termination.
7.3 BY COMPANY FOR CAUSE. The Company may terminate Xxxxxxxx'x
employment at any time for Cause (as hereinafter defined). If Xxxxxxxx is
terminated by the Company for Cause, Xxxxxxxx shall be entitled to receive
only the unpaid portion of her base salary and accrued vacation attributable
to all periods prior to and including the date of her termination, and
reimbursable for reasonable reimbursable expenses incurred on behalf of the
Company prior to the date of her termination.
"Cause" means Xxxxxxxx'x (a) conviction of, or plea of NOLO
CONTENDERE to a felony; (b) theft or embezzlement, or attempted theft
or embezzlement as evidenced by the existence of probable cause to
believe that such has occurred as reasonably determined by the Company,
of money or property or assets of the Company or any of its affiliates;
(c) use of illegal drugs; (d) material breach of this Agreement;
(e) commission of any act or acts of moral turpitude in violation of
Company policy; (f) gross negligence or willful misconduct in the
performance of her duties; or (g) breach of any fiduciary duty owed to
the Company, including, without limitation, engaging in directly
competitive acts while employed by the Company.
If the event constituting Cause is curable, the Company shall notify Xxxxxxxx
in writing ("Notice of Cause") in accordance with Section 9.1.1 below that it
intends to terminate her employment for Cause effective at the end of a
twenty (20) day period following the date that Xxxxxxxx receives a Notice of
Cause, such Notice of Cause to state in detail the particular event that
constitutes Cause. If the event constituting Cause is curable, Xxxxxxxx shall
have a reasonable opportunity to cure the event constituting Cause following
her receipt of such Notice of Cause from the Company; provided, however, if
Xxxxxxxx has not cured such event to the reasonable satisfaction of the
Company and the Company has not waived in writing Xxxxxxxx'x failure to cure
during the twenty (20) day period following the date of the Notice of Cause,
the Company may terminate Xxxxxxxx'x employment effective following the end
of such twenty (20) day period.
7.4 BY THE COMPANY OTHER THAN FOR CAUSE. The Company may terminate
Xxxxxxxx'x employment on written notice to Xxxxxxxx at any time. If
Xxxxxxxx'x employment is terminated by the Company, other than for Cause,
Xxxxxxxx shall be entitled to receive and the Company shall pay:
(a) the unpaid portion of her base salary and accrued vacation
attributable to and including the date of termination;
(b) reimbursement for reasonable business expenses incurred by her
on behalf of the Company prior to the date of termination;
(c) a Severance Benefit in an amount equal to and on the same basis
as provided in Subsection 7.2(c); and
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(d) health care coverage for medical and dental benefits comparable
to that in effect for Xxxxxxxx and her qualified dependents
immediately prior to such termination at no cots to Xxxxxxxx for
two years following such termination.
7.5 UPON DEATH OR DISABILITY. In the event of:
7.5.1 Xxxxxxxx'x death during the Employment Term, the Employment
Term shall end as of the date of Xxxxxxxx'x death and the Company shall pay
or provide, as applicable, to Xxxxxxxx'x estate and/or her beneficiaries, as
the case may be:
(a) base salary and accrued vacation earned but not paid prior to the
date of Xxxxxxxx'x death; and
(b) an additional amount equal to one (1) year's base salary at the
level then effect immediately prior to Xxxxxxxx'x death, plus an
amount equal to her bonus earned from the Company for the year
preceding the year of termination payable in equal installments on
the Company's regular pay schedule commencing within thirty (30)
days after Xxxxxxxx'x death and continuing for twelve (12) months
thereafter.
7.5.2 Xxxxxxxx'x "Disability" during the Employment Term, the
Employment Term shall end as of then date Xxxxxxxx shall be deemed
"Disabled", and the Company shall pay or provide, as applicable, to Xxxxxxxx:
(a) base salary and accrued vacation earned but not paid prior to the
date of the termination of Xxxxxxxx'x employment due to her
Disability, and
(b) an additional amount equal to one (1) year's base salary at the
level then in effect immediately prior to such termination, plus an
amount equal to her bonus earned from the Company for the year
preceding the year of termination (collectively, "Disability
Severance"), payable in equal installments on the Company's regular
pay schedule, commencing within thirty (30) days after termination
of Xxxxxxxx'x employment due to her Disability and continuing for
twelve (12) months thereafter, except as provided in Section 7.6.
(c) For the purposes of this Agreement, "Disability" or "Disabled"
shall mean a disability as determined under the Company's long-term
disability plan or program as in effect on the date the Disability
of Xxxxxxxx first occurs or if no such plan or program exists, then
a "Disability" as and when determined in a written medical opinion
of a duly licensed, actively practicing physician reasonably
acceptable to the Company, which states that Xxxxxxxx is suffering
from a physical or mental condition which has rendered her or is
expected to render her unable to perform her duties under this
Agreement or any comparable duties.
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7.6 NO MITIGATION - NO OFF-SET. In the event of any termination of
Xxxxxxxx'x employment under Sections 7.2, 7.4, 7.5.2 or following a "Change
in Control", Xxxxxxxx shall be under no obligation to seek other employment.
In addition, in the event of any termination of Xxxxxxxx'x employment under
Sections 7.2, 7.4, 7.5 or after a "Change in Control", there will be no
off-set of any Severance Benefit, Disability Severance or other benefits
payable to her or on her behalf under Sections 7.2, 7.4 or 7.5 for any
remuneration, whether in cash, property, services or otherwise, paid or
provided to or on behalf of Xxxxxxxx with respect to any services performed
by Xxxxxxxx, whether as employee, consultant or otherwise, for a party other
than the Company during the period that such benefits are payable except as
follows:
7.6.1 In the event of any termination of Xxxxxxxx'x
employment under Section 72 or 7.4, if Xxxxxxxx,
during the first year after such termination is
engaged and paid as an employee or independent
contractor to provide services for any entity other
than the Company, any remuneration she receives
therefore during the second year of such Severance
Benefit period, shall be off-set against any
Severance Benefit payable to Xxxxxxxx during such
second year of the Severance Benefit period; and
7.6.2 In the event of any termination of Xxxxxxxx'x
employment under Section 7.5.2, the amount of any
Disability Severance payable to Xxxxxxxx under
Section 7.5.2 shall be off-set by the amount of any
long-term disability benefits received by Xxxxxxxx
under the Company's long-term disability policy then
in effect.
7.6.3 For the purposes of this Agreement, "Change in
Control" shall have the same meaning as set forth in
Exhibit "2" attached hereto.
8. PARACHUTE LIMITATION. Except as provided in the following
sentence, payments pursuant to this Agreement ("Payments") shall not exceed
the largest sum (`Parachute Limitation') which will not result, directly or
indirectly, in the treatment of any amount paid or payable by the Company to
Xxxxxxxx (whether or not pursuant to this Agreement, and including the
Payments) as an Excess Parachute Payment. Notwithstanding the preceding
sentence, Xxxxxxxx shall receive the full amount of the Payments without
regard to the Parachute Limitation if Xxxxxxxx would realize a greater
aftertax amount receiving the full amount of the Payments without regard to
the Parachute Limitation than Xxxxxxxx would realize by receiving the
Payments limited to the Parachute Limitation as provided in the preceding
sentence.
All computations and determinations required by this Section 8 shall
be made by Xxxxxxxx'x accountant, acting in good faith. For the purposes of
this Agreement, the term `Excess Parachute Payment' shall have the same
meaning as the term `excess parachute payment' has under section 280G of the
Internal Revenue Code of 1986, as amended and the regulations thereunder.
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9. MISCELLANEOUS.
9.1 NOTICES. All notices hereunder shall be given in writing and
sent to the party for whom such is intended by hand delivery or United States
certified or registered mail, return receipt requested, postage prepaid, or
overnight courier service, addressed to the party for whom intended at the
following respective addresses:
If to the Company: United Stationers Supply Co.
0000 X. Xxxx Xxxx
Xxx Xxxxxxx, XX 00000
Attn: President
If to the Parent Company: United Stationers Inc.
0000 Xxxx Xxxx Xxxx
Xxx Xxxxxxx, XX 00000
Attn: CEO and General Counsel
If to Xxxxxxxx: Xxxxxx X. Xxxxxxxx
0000 X X. Xxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
With a Courtesy Copy to: Xxxxx & Xxxxxxxx Ltd.
000 Xxxxx XxXxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx and
Xxxx X. Xxxxxx (#723701)
Or to such other persons and/or at such other addresses as may be
designated by written notice served in accordance with the provisions hereof.
Such notices shall be deemed to have been served, if hand delivered, on the
day delivered, and if mailed, on the third day following the date deposited
in the mail. Urgent notices shall be given by fax to the same addresses and
confirmed by mail as provided above. All notices sent by fax shall be deemed
to have been served upon receipt of the fax, but only if in fact confirmed by
mail promptly after dispatch of the fax.
9.2 ASSIGNMENT. This Agreement and all rights and benefits hereunder
are personal to Xxxxxxxx and neither this Agreement nor any right or interest
of Xxxxxxxx herein, or arising hereunder, shall be voluntarily or
involuntarily sold, transferred or assigned by Xxxxxxxx. Any attempt by
Xxxxxxxx to assign, execute, attach, transfer, pledge, hypothecate or
otherwise dispose of any such benefits or amounts or similar process
thereupon, shall be null and void and of no effect and shall relieve the
Company of all liabilities hereunder. This Agreement and all of the Company's
right and obligations hereunder may be assigned and/or delegated, as the case
may be, without Xxxxxxxx'x consent, to any entity which merges with the
Company or which acquires substantially all of the assets of the Company and
which agrees to be bound hereby. The enforceability of Xxxxxxxx'x rights
under the Agreement shall not be affected by any assignment or merger.
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9.3 WITHHOLDING. The payments and benefits set forth pursuant to
this Agreement shall be subject to applicable federal, state and local
withholding taxes and to any other withholding required by applicable law or
pursuant to this Agreement. Xxxxxxxx agrees that, to the extent that any
taxes of any kind may be due as a result of any such payment to Xxxxxxxx,
Xxxxxxxx shall be solely responsible for such taxes and will indemnify,
defend and hold harmless the Company in the event there is any claim against
the Company for such taxes.
9.4 BINDING. This Agreement shall be binding upon and inure to the
benefit of the parties and their respective heirs, personal representatives,
successors and permitted assigns.
9.5 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties and contains all the agreements between such
parties with respect to the subject matter hereof. This Agreement supersedes
all other agreements, oral or in writing, between the parties with respect to
the subject matter hereof.
9.6 AMENDMENT. No change or modification of this Agreement shall be
valid unless the same shall be approved by the Board and in writing and
signed by Xxxxxxxx and an authorized representative of the Company other than
Xxxxxxxx. No waiver of any provisions of this Agreement shall be valid unless
in writing and signed by the person or party to be charged.
9.7 ENFORCEABILITY. If any provisions of this Agreement (or portions
thereof) shall for any reason, be invalid or unenforceable, such provision
(or portions thereof), shall be ineffective only to the extent of such
invalidity or unenforceability, and the remaining provisions or portions
shall be valid, enforceable and of full force and effect.
9.8 HEADINGS. The Section or paragraph headings or titles are for
convenience only and shall not be deemed a part of this Agreement.
9.9 MULTIPLE COUNTERPARTS. This Agreement may be executed in
multiple counterparts, each of which shall be deemed to be an original and
all of which taken together shall constitute a single instrument.
9.10 ATTORNEY FEES. If Xxxxxxxx or her estate or designee prevails
in any action to enforce their rights under this Agreement, they shall be
entitled to receive their attorney's fees, costs and expenses incurred in
enforcing their rights under this Agreement, as well as interest at the Prime
Rate as publicly announced by The Northern Trust Company from time to time on
the amount of the judgment from the date of demand for payment hereunder
through the date of receipt of the amount of the judgment.
9.11 PUBLIC ANNOUNCEMENT. Absent Xxxxxxxx'x prior written approval,
the Company shall make no public announcement regarding her pending
employment with the Company prior to the Effective Date, except as may be
required by applicable law in the written, legal opinion of outside
securities counsel regularly engaged by the Company, in which case prior
notice of such public announcement shall be provided by the Company to
Xxxxxxxx.
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IN WITNESS WHEREOF, the Company and the Parent Company have caused
this Agreement to be executed in their respective corporate names by an
officer thereof hereunto duly authorized, and Xxxxxxxx has hereunto set their
hands, as of the day and year first above written.
UNITED STATIONERS SUPPLY CO.,
an Illinois corporation
By:
--------------------------------------
Xxxxxxx X. Xxxxxxxxx
President and
Chief Executive Officer
UNITED STATIONERS INC.
an Delaware corporation
By:
--------------------------------------
Title:
-----------------------------------
-----------------------------------------
Xxxxxx Xxxxxxxx
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