Exhibit 10.3
MANAGEMENT STOCKHOLDER'S AGREEMENT
This Management Stockholder's Agreement (this "Agreement") is
entered into as of the date set forth on the signature page hereof among CORNING
CONSUMER PRODUCTS COMPANY, a Delaware corporation (the "Company"), CCPC
Acquisition Corp., a Delaware corporation (the "Parent"), and the individual
whose name and address appears on the signature page hereof (the "Purchaser"
and, together with the Company, the "Parties").
RECITALS
This Agreement is one of several agreements ("Other
Purchasers' Agreements") which have been, or which in the future will be,
entered into among the Company, the Parent and other individuals who are or will
be key employees of the Company or one of its subsidiaries (collectively, the
"Other Purchasers").
Prior to April 1, 1998, each of the 1,000 outstanding shares
of common stock (the "Common Stock") of the Company was subdivided, changed and
converted into 24,000 shares of Common Stock (or 24,000,000 in the aggregate).
The Parent has agreed to sell to the Purchaser the number of
shares of Common Stock set forth on the signature page hereof (the "Purchase
Stock") at a purchase price of $5.00 per share (the "Purchase Price"). In
addition, the Company will grant to the Purchaser an option or options to
purchase Common Stock ("Options") at an exercise price of $5.00 per share of
Common Stock pursuant to the terms of the 1998 Stock Purchase and Option Plan
for Key Employees of Corning Consumer Products Company and Subsidiaries (the
"Option Plan") and the Non-Qualified Stock Option Agreement attached hereto as
Exhibit A.
AGREEMENT
To implement the foregoing and in consideration of the mutual
agreements contained herein, the Parties agree as follows:
1. Purchase of Stock; Issuance of Options. (a) On or prior to
the purchase date identified on the signature page hereof (or such later date to
which the Company and the Purchaser agree in writing), (i) the Parent will
deliver the Purchase Stock and the Purchaser shall pay the Parent the Purchase
Price for each share delivered and (ii) the Company will grant the Options
described above to the Purchaser in accordance with, and subject to the terms
and conditions contained in, the Option Plan and the Non-Qualified Stock Option
Agreement.
(b) The Parties shall execute and deliver to each other copies
of the NonQualified Stock Option Agreement concurrently with the issuance of the
Options.
2. Purchaser's Representations, Warranties and Agreements. (a)
The Purchaser hereby represents and warrants that he is acquiring the Purchase
Stock and, at the time of exercise or other acquisition, all other Stock (as
defined in Section 8) for investment for his own account and not with a view to,
or for resale in connection with, the distribution
or other disposition thereof. The Purchaser agrees and acknowledges that he will
not, directly or indirectly, offer, transfer, sell, assign, pledge, hypothecate
or otherwise dispose of any shares of the Stock unless such transfer, sale,
assignment, pledge, hypothecation or other disposition complies with Section 3
of this Agreement and (i) the transfer, sale, assignment, pledge, hypothecation
or other disposition is pursuant to an effective registration statement under
the Securities Act of 1933, as amended, or the rules and regulations in effect
thereunder (the "Act"), and any applicable state securities law or (ii) counsel
for the Purchaser (which counsel shall be acceptable to the Company) shall have
furnished the Company with an opinion, satisfactory in form and substance to the
Company, that no such registration is required because of the availability of an
exemption from registration under the Act and any applicable state securities
law. Notwithstanding the foregoing, the Company acknowledges and agrees that any
of the following transfers are deemed to be in compliance with the Act,
applicable state securities law and this Agreement and no opinion of counsel is
required in connection therewith: (x) a transfer made pursuant to Section 4, 5
or 6 hereof, (y) a transfer upon the death of the Purchaser to his executors,
administrators, testamentary trustees, legatees or beneficiaries (the
"Purchaser's Estate") or a transfer to the executors, administrators,
testamentary trustees, legatees or beneficiaries of a person who has become a
holder of Stock in accordance with the terms of this Agreement, provided that it
is expressly understood that any such transferee shall be bound by the
provisions of this Agreement and (z) a transfer made after the Vesting Reference
Date (as defined below) in compliance with the federal and state securities laws
to a trust, custodianship or limited partnership the beneficiaries or limited
partners of which may include only the Purchaser, his spouse or his lineal
descendants (a "Purchaser's Trust") or a transfer made after the third
anniversary of the Vesting Reference Date to such a trust by a person who has
become a holder of Stock in accordance with the terms of this Agreement,
provided that such transfer is made expressly subject to this Agreement and that
the transferee agrees in writing to be bound by the terms and conditions hereof.
For purposes of this Agreement, the term "Valuation Reference
Date" shall mean April 1, 1998 and the term "Vesting Reference Date" shall mean
the date set forth on the signature page hereof as the Vesting Reference Date.
(b) The certificate (or certificates) representing the Stock
shall bear the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE TRANSFERRED,
SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS
SUCH TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER
DISPOSITION COMPLIES WITH THE PROVISIONS OF THE MANAGEMENT
STOCKHOLDER'S AGREEMENT AMONG CORNING CONSUMER PRODUCTS COMPANY ("THE
COMPANY"), CCPC ACQUISITION CORP. AND THE PURCHASER NAMED ON THE FACE
HEREOF (A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY).
EXCEPT AS OTHERWISE PROVIDED IN SUCH AGREEMENT, NO TRANSFER, SALE,
ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION OF THE SHARES
REPRESENTED BY THIS CERTIFICATE MAY BE MADE EXCEPT (A) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), AND ANY APPLICABLE STATE SECURITIES LAW OR (B) IF
(I) THE COMPANY HAS BEEN FURNISHED
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WITH A SATISFACTORY OPINION OF COUNSEL FOR THE HOLDER THAT SUCH
TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION
IS EXEMPT FROM THE PROVISIONS OF SECTION 5 OF THE ACT OR THE RULES AND
REGULATIONS IN EFFECT THEREUNDER, AND IN COMPLIANCE WITH APPLICABLE
PROVISIONS OF STATE SECURITIES LAWS, AND (II) IF THE HOLDER IS A
CITIZEN OR RESIDENT OF ANY COUNTRY OTHER THAN THE UNITED STATES, OR THE
HOLDER DESIRES TO EFFECT ANY SUCH TRANSACTION IN ANY SUCH COUNTRY, THE
COMPANY HAS BEEN FURNISHED WITH A SATISFACTORY OPINION OR OTHER ADVICE
OF COUNSEL FOR THE HOLDER THAT SUCH TRANSACTION WILL NOT VIOLATE THE
LAWS OF SUCH COUNTRY."
(c) The Purchaser acknowledges that he has been advised that
(i) the Stock has not been registered under the Act or any state securities law,
(ii) the Stock must be held indefinitely and the Purchaser must continue to bear
the economic risk of the investment in the Stock unless it is subsequently
registered under the Act and any applicable state securities law, or an
exemption from such registration is available, (iii) it is not anticipated that
there will be any public market for the Stock, (iv) Rule 144 promulgated under
the Act is not currently available with respect to sales of any securities of
the Company, and the Company has made no covenant to make such Rule available
(except as provided in Section 9(b)), (v) when and if shares of the Stock may be
disposed of without registration in reliance on Rule 144, such disposition can
be made only in limited amounts in accordance with the terms and conditions of
such Rule, (vi) if the Rule 144 exemption is not available, public sale without
registration will require compliance with Regulation A or some other exemption
under the Act and applicable state securities law, (vii) a restrictive legend in
the form heretofore set forth shall be placed on the certificates representing
the Stock and (viii) a notation shall be made in the appropriate records of the
Company indicating that the Stock is subject to restriction on transfer and, if
the Company should at some time in the future engage the services of a stock
transfer agent, appropriate stop transfer restrictions will be issued to such
transfer agent with respect to the Stock.
(d) If any shares of the Stock are to be disposed of in
accordance with Rule 144 under the Act or otherwise, the Purchaser shall
promptly notify the Company of such intended disposition and shall deliver to
the Company at or prior to the time of such disposition such documentation as
the Company may reasonably request in connection with such sale and, in the case
of a disposition pursuant to Rule 144, shall deliver to the Company an executed
copy of any notice on Form 144 required to be filed with the Securities and
Exchange Commission.
(e) The Purchaser agrees that, if any shares of the capital
stock of the Company are offered to the public pursuant to an effective
registration statement under the Act and applicable state securities law (other
than registration of securities issued under an employee plan), the Purchaser
will not effect any public sale or distribution of any shares of the Stock not
covered by such registration statement within 7 days prior to, or within 180
days after, the effective date of such registration statement (or, if later, the
date of the public offering pursuant to such registration statement), unless
otherwise agreed to in writing by the Company; provided that, if any such
offering of shares of the capital stock of the Company is pursuant to a public
offering through an underwriter or underwriters, then the period of 180 days
referred to above shall be such longer or shorter period as the underwriters
shall
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require in the underwriting agreement for such offering with respect to public
sales or distributions of shares of the Stock by the Company.
(f) The Purchaser represents and warrants that (i) he has
received and reviewed a Private Placement Memorandum (the "Private Placement
Memorandum") relating to the Stock and the documents referred to therein and
(ii) he has been given the opportunity to obtain any additional information or
documents and to ask questions and receive answers about such documents, the
Company and the business and prospects of the Company which he deems necessary
to evaluate the merits and risks related to his investment in the Stock and to
verify the information contained in the Private Placement Memorandum and the
information received as indicated in this Section 2(f)(ii), and he has relied
solely on such information.
(g) The Purchaser further represents and warrants that (i) his
financial condition is such that he can afford to bear the economic risk of
holding the Stock for an indefinite period of time and has adequate means for
providing for his current needs and personal contingencies, (ii) he can afford
to suffer a complete loss of his investment in the Stock, (iii) all information
which he has provided to the Company concerning himself and his financial
position is correct and complete as of the date of this Agreement, (iv) he
understands and has taken cognizance of all risk factors related to the purchase
of the Stock, including those set forth in the Private Placement Memorandum
referred to above, and (v) his knowledge and experience in financial and
business matters are such that he is capable of evaluating the merits and risks
of his purchase of the Stock as contemplated by this Agreement.
3. Restriction on Transfer. Except for transfers permitted by
clauses (x), (y) and (z) of Section 2(a) or a sale of shares of Stock pursuant
to an effective registration statement under the Act and applicable state
securities law filed by the Company or pursuant to the Sale Participation
Agreement, the Purchaser agrees that he will not transfer, sell, assign, pledge,
hypothecate or otherwise dispose of any shares of the Stock at any time prior to
the fifth anniversary of the Vesting Reference Date. No transfer of any such
shares in violation hereof shall be made or recorded on the books of the Company
and any such transfer shall be void and of no effect.
4. Right of First Refusal. At any time after the fifth
anniversary of the Vesting Reference Date, if the Purchaser receives an Offer
(as defined below) which the Purchaser wishes to accept, then the Purchaser
shall cause the Offer to be reduced to writing and shall notify the Company in
writing of his wish to accept the Offer. The Purchaser's notice shall contain an
irrevocable offer to sell such shares of Stock to the Company (in the manner set
forth below) at a purchase price equal to the price contained in, and on the
same terms and conditions of, the Offer, and shall be accompanied by a true copy
of the Offer (which shall identify the third party who has made the Offer (the
"Offeror") or other proposed method of disposition). At any time within 30 days
after the date of the receipt by the Company of the Purchaser's notice, the
Company shall have the right and option to purchase, or to arrange for a third
party to purchase, all of the shares of Stock covered by the Offer either (i) at
the same price and on the same terms and conditions as the Offer or (ii) if the
Offer includes any consideration other than cash, then at the sole option of the
Company, at the equivalent all cash price, determined in good faith by a duly
authorized compensation committee of, or representing, the Company's Board of
Directors (the "Compensation Committee"), by
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delivering a certified bank check or checks in the appropriate amount to the
Purchaser at the principal office of the Company against delivery of
certificates or other instruments representing the shares of the Stock so
purchased, appropriately endorsed by the Purchaser. If at the end of such 30 day
period, the Company has not tendered the purchase price for such shares in the
manner set forth above, the Purchaser may during the succeeding 60 day period
sell not less than all of the shares of Stock covered by the Offer to the
Offeror or in the manner of disposition identified at the time the Offer is
delivered to the Company, as the case may be, at a price and on terms no less
favorable to the Purchaser than those contained in the Offer. Promptly after
such sale, the Purchaser shall notify the Company of the consummation thereof
and shall furnish such evidence of the completion and time of completion of such
sale and of the terms thereof as may reasonably be requested by the Company. If,
at the end of 60 days following the expiration of the 30 day period for the
Company to purchase the Stock, the Purchaser has not completed the sale of such
shares of the Stock as aforesaid, all the restrictions on sale, transfer or
assignment contained in this Agreement shall again be in effect with respect to
such shares of the Stock.
For purposes of this Agreement, "Offer" shall mean a bona fide
offer to purchase any or all of the Purchaser's shares of Stock received by the
Purchaser from an Offeror, and shall include, without limitation, any proposed
sale of shares of Stock by the Purchaser pursuant to a registration statement
under the Act and any applicable state securities law or under an available
exemption from registration under the Act, including Rule 144 under the Act if
it is then available, and any applicable state securities law; provided, that
the term Offer shall not include any proposed sale of shares pursuant to said
Rule 144 (subject to such rule being available) after a Public Offering has
occurred.
5. Purchaser's Resale of Stock and Options to the Company Upon
a Special Treatment Event. (a) Except as otherwise provided herein, if, on or
prior to the fifth anniversary of the Vesting Reference Date, (i) (A) the
Purchaser is still in the employ of the Company or any subsidiary of the Company
and (B) the Purchaser either dies or becomes permanently disabled or (ii) the
Purchaser retires from the Company or any of its subsidiaries at age 65 or over
(or such other age as may be approved by the Compensation Committee) after
having been employed by the Company or any of its subsidiaries for at least
three years after the Vesting Reference Date (any event referred to in clause
(i) or clause (ii) being referred to herein as a "Special Treatment Event"),
then the Purchaser, the Purchaser's Estate or a Purchaser's Trust, as the case
may be, shall have the right, for six months following the date of the
occurrence of such Special Treatment Event, to (x) sell to the Company, and the
Company shall be required to purchase, on one occasion, all or any portion of
the shares of Stock then held by the Purchaser, the Purchaser's Estate and/or
the Purchaser's Trust, as the case may be, at the Special Treatment Repurchase
Price, as determined in accordance with Section 7, and (y) require the Company
to pay to the Purchaser, the Purchaser's Estate or the Purchaser's Trust, as the
case may be, an additional amount equal to the Option Excess Price, determined
on the basis of the Special Treatment Repurchase Price as provided in Section 8,
with respect to the termination of outstanding Options held by the Purchaser. No
fewer than 10 business days prior to the last day of the six month period
following the occurrence of a Special Treatment Event, the Purchaser, the
Purchaser's Estate and/or the Purchaser's Trust, as the case may be, shall send
written notice to the Company of its intention to sell shares of Stock and to
terminate such Options in exchange for the payment referred to in the preceding
sentence (the "Redemption Notice").
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For purposes of this Agreement, the Purchaser shall be deemed
to have a "permanent disability" if the Purchaser is unable to engage in the
activities required by the Purchaser's job by reason of any medically determined
physical or mental impairment which can be expected to result in death or which
has lasted or can be expected to last for a continuous period of not less than
12 months.
(b) The completion of the purchase provided for in Section
5(a) shall take place at the principal office of the Company on the tenth
business day after the giving of the Redemption Notice. The Special Treatment
Repurchase Price and any payment with respect to the Options as described above
shall be paid by delivery to the Purchaser, the Purchaser's Estate or the
Purchaser's Trust, as the case may be, of a certified bank check or checks in
the appropriate amount payable to the order of the Purchaser, the Purchaser's
Estate or the Purchaser's Trust, as the case may be, against delivery of
certificates or other instruments representing the Stock so purchased and
appropriate documents cancelling the Options so terminated appropriately
endorsed or executed by the Purchaser, the Purchaser's Estate or the Purchaser's
Trust, or his or its duly authorized representative.
(c) Notwithstanding anything in Section 5(a) or 5(b) to the
contrary and subject to Section 11, (i) if there exists and is continuing a
default or an event of default on the part of the Company or any subsidiary of
the Company under any loan, guarantee or other agreement under which the Company
or any subsidiary of the Company has borrowed money or such repurchase would
result in a default or an event of default on the part of the Company or any
subsidiary of the Company under any such agreement or (ii) if a repurchase would
not be permitted under Section 170 of the General Corporation Law of the State
of Delaware or would otherwise violate the General Corporation Law of the State
of Delaware (each such occurrence referred to in clause (i) or (ii) above being
an "Event"), then the Company shall not be obligated to repurchase any of the
Stock or the Options from the Purchaser, the Purchaser's Estate or the
Purchaser's Trust, as the case may be, until the first business day which is 10
calendar days after all of the foregoing Events have ceased to exist (the
"Repurchase Eligibility Date"); provided, however, that (A) the number of shares
of Stock subject to repurchase under this Section 5(c) shall be that number of
shares of Stock, and (B) the number of Exercisable Option Shares (as defined in
Section 8) for purposes of calculating the Option Excess Price payable under
this Section 5(c) shall be that number of Exercisable Option Shares, held by the
Purchaser, the Purchaser's Estate or a Purchaser's Trust, as the case may be, at
the time of delivery of a Redemption Notice in accordance with Section 5(a)
hereof; provided, further, that the Repurchase Calculation Date shall be
determined in accordance with Section 7 as of the Repurchase Eligibility Date
(unless the Special Treatment Repurchase Price would be greater if the
Repurchase Calculation Date had been determined as if no Event had occurred, in
which case, solely for purposes of this proviso, the Repurchase Calculation Date
shall be determined as if no Event had occurred). All Options exercisable as of
the date of a Redemption Notice shall continue to be exercisable until the
repurchase pursuant to such Redemption Notice.
(d) Notwithstanding any other provision of this Section 5 to
the contrary and subject to Section 11, the Purchaser, the Purchaser's Estate or
the Purchaser's Trust, as the case may be, shall have the right to withdraw any
Redemption Notice which has been pending for 60 or more days and which has
remained unsatisfied because of the provisions of Section 5(c).
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6. The Company's Option to Repurchase Stock and Options of
Purchaser. (a) If, on or prior to the fifth anniversary of the Vesting Reference
Date, (i) the Purchaser's active employment with the Company (and/or, if
applicable, its subsidiaries) is voluntarily or involuntarily terminated for any
reason whatsoever, with or without cause, (ii) the beneficiaries of a
Purchaser's Trust shall include any person or entity other than the Purchaser,
his spouse or his lineal descendants, or (iii) the Purchaser shall effect a
transfer of any of the Stock other than as permitted in this Agreement (any of
the foregoing, a "Call Event"), then the Company shall have the right to
purchase all, but not less than all, of the shares of the Stock then held by the
Purchaser or a Purchaser's Trust at the Ordinary Repurchase Price, as determined
in accordance with Section 7; provided, however, that if the termination of
employment results from a Special Treatment Event, then, notwithstanding the
foregoing, the Company shall have the right to purchase all, but not less than
all, of the shares of the Stock then held by the Purchaser or a Purchaser's
Trust but the Repurchase Price (as defined in Section 7) shall be the Special
Treatment Repurchase Price. The Company shall have a period of 75 days from the
date of a Call Event in which to give notice in writing to the Purchaser of the
exercise of such election ("Call Notice"). In the event that the Company
exercises its right to repurchase shares of the Stock pursuant to this Section 6
and the Purchaser's employment has not been terminated by the Company for Cause
(as defined in the Non-Qualified Stock Option Agreement) or by the Purchaser
without Good Reason (as defined in the Non-Qualified Stock Option Agreement),
then the Company shall also pay the Purchaser an amount equal to the Option
Excess Price determined on the basis of the Ordinary Repurchase Price or the
Special Treatment Repurchase Price, as the case may be, as provided in Section
8, with respect to the termination of outstanding Options held by the Purchaser.
(b) The completion of any purchase pursuant to Section 6(a)
shall take place at the principal office of the Company on the tenth business
day after the giving of the Call Notice. The Ordinary Repurchase Price or the
Special Treatment Repurchase Price, as the case may be, and any payment with
respect to the Options as described above shall be paid by delivery to the
Purchaser of a certified bank check or checks in the appropriate amount payable
to the order of the Purchaser against delivery of certificates or other
instruments representing the Stock so purchased and appropriate documents
cancelling the Options so terminated, appropriately endorsed or executed by the
Purchaser or the Purchaser's Trust, or his or its authorized representative.
(c) Notwithstanding any other provision of this Section 6 to
the contrary and subject to Section 11, if there exists and is continuing any
Event, then the Company shall delay the repurchase of any of the Stock or the
Options (pursuant to a Call Notice timely given in accordance with Section 6(a)
hereof) from the Purchaser, the Purchaser's Estate or the Purchaser's Trust, as
the case may be, until the Repurchase Eligibility Date; provided, however, that
(i) the number of shares of Stock subject to repurchase under this Section 6(c)
shall be that number of shares of Stock, and (ii) the number of Exercisable
Option Shares for purposes of calculating the Option Excess Price payable under
this Section 6(c) shall be that number of Exercisable Option Shares, held by the
Purchaser, the Purchaser's Estate or a Purchaser's Trust, as the case may be, at
the time of delivery of a Call Notice in accordance with Section 6(a) hereof;
provided, further, that the Repurchase Calculation Date shall be determined in
accordance with Section 7 based on the Repurchase Eligibility Date (unless the
applicable Repurchase Price would be greater if the Repurchase Calculation Date
had been determined as if no Event had occurred, in which case, solely for
purposes of this proviso,
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the Repurchase Calculation Date shall be determined as if no Event had
occurred); and provided, further that if the Repurchase Eligibility Date has not
occurred within 18 months of the date of the Call Notice, then the Call Notice
shall expire. All Options exercisable as of the date of a Call Notice shall
continue to be exercisable until the repurchase pursuant to such Call Notice.
7. Determination of Repurchase Price. (a) The Special
Treatment Repurchase Price and the Ordinary Repurchase Price are hereinafter
collectively referred to as the "Repurchase Price." The Repurchase Price shall
be calculated on the basis of the unaudited financial statements of the Company
or the Market Price Per Share (as defined in Section 7(f)) as of the last day of
the month preceding the later of (i) the month in which the event giving rise to
the repurchase occurs and (ii) the month in which the Repurchase Eligibility
Date occurs (hereinafter called the "Repurchase Calculation Date"). The event
giving rise to the repurchase shall be the death, permanent disability,
retirement or termination of employment, as the case may be, of the Purchaser,
and not the giving of any notice required pursuant to Section 5 or 6.
(b) (i) Prior to a Public Offering (as defined in Section
7(e)), the Special Treatment Repurchase Price shall be a per share Repurchase
Price equal to $5.00 (the "Original Per Share Price") plus the amount, if any,
by which the Modified Book Value Per Share (as defined in Section 7(d)) as of
the Repurchase Calculation Date exceeds the Original Per Share Price.
(ii) After a Public Offering, the Special Treatment
Repurchase Price shall be a per share Repurchase Price equal to the Original Per
Share Price plus the amount, if any, by which the Market Price Per Share as of
the Repurchase Calculation Date exceeds the Original Per Share Price.
(c) (i) Prior to a Public Offering, the Ordinary Repurchase
Price shall be a per share Repurchase Price equal to the lesser of:
(A) the Modified Book Value Per Share; and
(B) the Original Per Share Price plus (x) the Percentage (as
defined below) multiplied by (y) the amount, if any, by which the
Modified Book Value Per Share as of the Repurchase Calculation Date
exceeds the Original Per Share Price.
(ii) After a Public Offering, the Ordinary Repurchase
Price shall be a per share Repurchase Price equal to the lesser of:
(A) the Market Price Per Share; and
(B) the Original Per Share Price plus (x) the Percentage
multiplied by (y) the amount, if any, by which the Market Price Per
Share as of the Repurchase Calculation Date exceeds the Original Per
Share Price.
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The "Percentage" shall be determined as follows:
Repurchase Calculation Date Percentage
--------------------------- ----------
Vesting Reference Date through and including the first 0%
anniversary of the Vesting Reference Date
After the first anniversary of the Vesting Reference Date through 20%
and including the second anniversary of the Vesting
Reference Date
After the second anniversary of the Vesting Reference Date 40%
through and including the third anniversary of the Vesting
Reference Date
After the third anniversary of the Vesting Reference Date 60%
through and including the fourth anniversary of the Vesting
Reference Date
After the fourth anniversary of the Vesting Reference Date 80%
through and including the fifth anniversary of the Vesting
Reference Date
After the fifth anniversary of the Vesting Reference Date 100%
(d) For purposes of this Agreement, "Modified Book Value Per
Share" shall be the quotient of:
(i) an amount equal to (A) $120 million plus (B) the
aggregate net income of the Company attributable to the Common Stock
from and after the Valuation Reference Date (as decreased by any net
losses from and after the Valuation Reference Date) plus (C) the
aggregate dollar amount contributed to the Company after the Valuation
Reference Date as common equity by the shareholders of the Company
minus (D) the aggregate dollar amount of any dividends paid or stock
repurchases made by the Company on the Common Stock after the Valuation
Reference Date,
divided by
(ii) the sum of the number of shares of Common Stock then
outstanding;
provided that, if any outstanding stock options, other rights to acquire Common
Stock, or securities convertible into shares of Common Stock have a per share
exercise price less than such quotient (collectively, the "In-the-Money
Options"), then, sequentially beginning with the In- the-Money Options with the
lowest per share exercise price and until either (A) all In-the-Money Options
have been included in such adjustment of such quotient or (B) there are no
In-the- Money Options with a per share exercise price less than the quotient as
adjusted that have not been included in such adjustment of such quotient, the
numerator of such quotient shall be increased by the aggregate exercise prices
of such In-the-Money Options and the denominator of such quotient shall be
increased by the number of shares of Common Stock issuable upon the exercise of
such In-the-Money Options.
The calculations set forth in clauses (i)(B), (i)(C) and (i)(D) of the
immediately preceding sentence shall be determined in accordance with generally
accepted accounting principles
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applied on a basis consistent with any prior periods as reflected in the
consolidated financial statements of the Company, without giving effect to any
adjustments required or permitted by Accounting Principles Board Opinion Nos. 16
and 17 with respect to assets acquired or liabilities assumed in the
recapitalization of the Company by the Parent (except that the determination of
gains or losses on sales of assets and on foreign currency translations
occurring subsequent to the recapitalization of the Company by the Parent shall
be computed as if purchase accounting had been required for the recapitalization
of the Company).
(e) For purposes of this Agreement, "Public Offering" shall
mean the sale of shares of Common Stock to the public subsequent to the date
hereof pursuant to a registration statement under the Act which has been
declared effective by the Securities and Exchange Commission (other than a
registration statement on Form S-8 or any other similar form) which results in
an active trading market in the Common Stock. A "Qualified Public Offering"
shall be deemed to have occurred if there has been a Public Offering and there
exists an active trading market in 19% or more of the Common Stock; provided,
that, for purposes of determining whether a Qualified Public Offering shall have
occurred, shares of Common Stock originally held by Corning Incorporated on
April 2, 1998 (including any shares which have been subsequently transferred by
Corning Incorporated) shall not be taken into account for the purposes of such
determination.
(f) For purposes of this Agreement, "Market Price Per Share"
shall mean the price per share equal to the average of the last sale price of
the Common Stock on the Repurchase Calculation Date on each exchange on which
the Common Stock may at the time be listed or, if there shall have been no sales
on any of such exchanges on the Repurchase Calculation Date, the average of the
closing bid and asked prices on each such exchange at the end of the Repurchase
Calculation Date or if there is no such bid and asked price on the Repurchase
Calculation Date on the next preceding date when such bid and asked price
occurred or, if the Common Stock shall not be so listed, the average of the
closing sales prices as reported by Nasdaq at the end of the Repurchase
Calculation Date in the over-the-counter market. If the Common Stock is not so
listed or reported by Nasdaq, then the Market Price Per Share shall be the
Modified Book Value Per Share.
(g) In determining the Repurchase Price, appropriate
adjustments shall be made for any future issuances of rights to acquire and
securities convertible into Common Stock and any stock dividends, splits,
combinations, recapitalizations or any other adjustment in the number of
outstanding shares of Common Stock.
8. Stock Issued to Purchaser Upon Exercise of Stock Options;
Termination of Options. (a) The Company may from time to time grant to the
Purchaser, in addition to the Options, options under the Option Plan to purchase
shares of Common Stock at the Original Per Share Price or at a different option
exercise price. For purposes of this Agreement, "Stock" shall mean and include
all Purchase Stock, all shares of Common Stock issued to the Purchaser by the
Company upon exercise of the Options, all shares of Common Stock issued to the
Purchaser by the Company upon exercise of any other stock options held by the
Purchaser and any other Common Stock otherwise acquired by the Purchaser at any
time when this Agreement is in effect.
(b) All outstanding Options and other options granted to the
Purchaser under the Option Plan or otherwise, whether or not then exercisable,
shall terminate automatically
10
(i) upon the payment by the Company to the Purchaser, pursuant to the provisions
of Section 5 or 6 of this Agreement, of an amount equal to the Option Excess
Price, (ii) upon the repurchase of Stock as provided in Section 5 or 6 of this
Agreement if the Option Excess Price is zero or a negative number, or (iii)
without payment in the event of a termination of the Purchaser's employment by
the Company for Cause or by the Purchaser without Good Reason.
For purposes of this Agreement, "Option Excess Price" shall
mean the excess, if any, of the Special Treatment Repurchase Price or the
Ordinary Repurchase Price, depending on which Repurchase Price is being used to
repurchase the remainder of the Stock, over the Option Price (as defined in the
Option Plan) multiplied by the number of Exercisable Option Shares.
For purposes of this Agreement, "Exercisable Option Shares"
shall mean the shares of Common Stock which, at the time of determination of the
Option Excess Price, could be purchased by the Purchaser upon exercise of his
outstanding Options or other options.
9. Representations, Warranties and Agreements of the Company
and the Parent. (a) The Company represents and warrants to the Purchaser that
(i) this Agreement has been duly authorized, executed and delivered by the
Company and (ii) the Purchase Stock is duly and validly issued, fully paid and
nonassessable. The Parent represents and warrants to the Purchaser that (i) this
Agreement has been duly authorized, executed and delivered by the Parent and
(ii) the Parent has valid title to the Purchase Stock.
(b) If the Company shall have engaged in a Public Offering,
(i) the Company shall use reasonable efforts to register the Options and the
Stock to be acquired on exercise thereof on a Form S-8 Registration Statement or
any successor to Form S-8 to the extent that such registration is then available
with respect to such Options and Stock, (ii) the Company shall use its best
efforts to comply with all state securities or "blue sky" laws which might be
applicable to the sale of the Stock and the issuance of the Options to the
Purchaser and (iii) the Company will file the reports required to be filed by it
under the Act and the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and the rules and regulations adopted by the Securities and Exchange
Commission ("SEC") thereunder, to the extent required from time to time to
enable the Purchaser to sell shares of Stock without registration under the Act
within the limitations of the exemptions provided by (A) Rule 144 under the Act,
as such Rule may be amended from time to time, or (B) any similar rule or
regulation hereafter adopted by the SEC. Notwithstanding anything contained in
this Section 9(b), the Company may deregister under Section 12 of the Exchange
Act if it is then permitted to do so pursuant to the Exchange Act and the rules
and regulations thereunder. Nothing in this Section 9(b) shall be deemed to
limit in any manner the restrictions on sales of Stock contained in this
Agreement.
10. "Piggyback" Registration Rights. (a) Until the later of
(i) the first occurrence of a Qualified Public Offering and (ii) the fifth
anniversary of the Vesting Reference Date, the Purchaser hereby agrees to be
bound by all of the terms, conditions and obligations of a Registration Rights
Agreement (the "Registration Rights Agreement"), between the Company and
entities controlled by Kohlberg Kravis Xxxxxxx & Co., L.P. (the "Parent"), and,
in the case of a Qualified Public Offering and subject to the limitations set
11
forth in this Section 10, shall have all of the rights and privileges of the
Registration Rights Agreement, in each case as if the Purchaser were an original
party (other than the Company) thereto; provided, however, that the Purchaser
shall not have any rights to request registration under Section 3 of the
Registration Rights Agreement; and provided, further, that the Purchaser shall
not be bound by any amendments to the Registration Rights Agreement unless the
Purchaser consents thereto. Notwithstanding anything to the contrary contained
in the Registration Rights Agreement, the Purchaser's rights and obligations
under the Registration Rights Agreement shall be subject to the limitations and
additional obligations set forth in this Section 10. All shares of Stock
purchased by the Purchaser pursuant to this Agreement and held by the Purchaser,
the Purchaser's Estate or a Purchaser's Trust, including shares purchased upon
the exercise of Options, shall be deemed to be Registrable Securities (as
defined in the Registration Rights Agreement).
(b) The Company will promptly notify the Purchaser in writing
(a "Notice") of any proposed registration (a "Proposed Registration") in
connection with a Qualified Public Offering. If within 15 days of the receipt by
the Purchaser of such Notice, the Company receives from the Purchaser, the
Purchaser's Estate or the Purchaser's Trust a written request (a "Request") to
register shares of Stock held by the Purchaser, the Purchaser's Estate or the
Purchaser's Trust (which Request will be irrevocable unless otherwise mutually
agreed to in writing by the Purchaser and the Company), shares of Stock will be
so registered as provided in this Section 10; provided, however, that for each
such registration statement only one Request, which shall be executed by the
Purchaser, the Purchaser's Estate or the Purchaser's Trust, as the case may be,
may be submitted for all Registrable Securities held by the Purchaser, the
Purchaser's Estate and the Purchaser's Trust.
(c) The maximum number of shares of Stock which will be
registered pursuant to a Request will be the lowest of (i) the number of shares
of Stock equal to the sum of (x) the product of (A) the number of shares of
Common Stock then held by the Purchaser multiplied by (B) the Percentage, plus
(y) all shares of Common Stock which the purchaser is then entitled to acquire
under an unexercised Option to the extent then exercisable, (ii) the product of
(A) the number of shares of Common Stock calculated under clause (i) above,
multiplied by (B) the quotient of (x) the number of shares of Stock then
proposed to be registered in such Proposed Registration by the Parent, if any,
divided by (y) the number of shares of Stock then held by the Parent, including
all shares of Stock which the Parent is then entitled to acquire upon
conversion, exercise or exchange of a security that is convertible into, or
exercisable or exchangeable for, Stock, (iii) the maximum number of shares of
Stock which the Company can register in the Proposed Registration without
adverse effect on the offering in the view of the managing underwriters (reduced
pro rata with all Other Purchasers as more fully described in Section 10(d)) and
(iv) the maximum number of shares which the Purchaser (pro rata based upon the
aggregate number of shares of Common Stock the Purchaser and all Other
Purchasers have requested be registered) and all Other Purchasers are permitted
to register under the Registration Rights Agreement.
(d) If a Proposed Registration involves an underwritten
offering and the managing underwriter advises the Company in writing that, in
its opinion, the number of shares of Common Stock requested to be included in
the Proposed Registration exceeds the number which can be sold in such offering,
so as to be likely to have an adverse effect on the price, timing or
distribution of the shares offered in such Qualified Public Offering as
contemplated by the Company, then the Company will include in the Proposed
Registration
12
(i) first, 100% of the shares proposed to be sold by the Company and, if such
registration was initiated pursuant to a "demand" registration right granted
pursuant to the Stockholders' Agreement dated April 1, 1998 among the Company,
the Parent and Corning Incorporated, the parties exercising such right and (ii)
second, to the extent of the number of shares requested to be included in such
registration which, in the opinion of such managing underwriter, can be sold
without having the adverse effect referred to above, the number of shares which
the Holders (as defined in the Registration Rights Agreement), including,
without limitation, the Purchaser and Other Purchasers, have requested to be
included in the Proposed Registration, such amount to be allocated pro rata
among all requesting Holders on the basis of the relative number of shares then
held by each such Holder (provided that any shares thereby allocated to any such
Holder that exceed such Holder's request will be reallocated among the remaining
requesting Holders in like manner).
(e) Upon delivering a Request the Purchaser will, if requested
by the Company, execute and deliver a custody agreement and power of attorney in
form and substance satisfactory to the Company with respect to the shares of
Stock to be registered pursuant to this Section 10 (a "Custody Agreement and
Power of Attorney"). The Custody Agreement and Power of Attorney will provide,
among other things, that the Purchaser will deliver to and deposit in custody
with the custodian and attorney-in-fact named therein a certificate or
certificates representing such shares of Stock (duly endorsed in blank by the
registered owner or owners thereof or accompanied by duly executed stock powers
in blank) and irrevocably appoint said custodian and attorney-in-fact as the
Purchaser's agent and attorney-in-fact with full power and authority to act
under the Custody Agreement and Power of Attorney on the Purchaser's behalf with
respect to the matters specified therein.
(f) If a Proposed Registration involves an underwritten
offering and the Parent enters into lockup agreements pursuant to the terms of
the underwriting agreement, then the Purchaser, if such Purchaser exercises
registration rights pursuant to this Section 10, shall enter into a lockup
agreement on substantially similar terms and conditions.
(g) The Purchaser agrees that he will execute such other
agreements as the Company may reasonably request to further evidence the
provisions of this Section 10.
11. Pro Rata Repurchases. Notwithstanding anything to the
contrary contained in Section 5, 6 or 7, if at any time consummation of all
purchases and payments to be made by the Company pursuant to this Agreement and
the Other Purchasers' Agreements would result in an Event, then the Company
shall make purchases from, and payments to, the Purchaser and Other Purchasers
pro rata (on the basis of the proportion of the number of shares of Stock and
the number of Options each such Purchaser and all Other Purchasers have elected
or are required to sell to the Company) for the maximum number of shares of
Stock and shall pay the Option Excess Price for the maximum number of Options
permitted without resulting in an Event (the "Maximum Repurchase Amount"). The
provisions of Section 5(c) and 6(c) shall apply in their entirety to payments
and repurchases with respect to Options and shares of Stock which may not be
made due to the limits imposed by the Maximum Repurchase Amount under this
Section 11. Until all of such Stock and Options are purchased and paid for by
the Company, the Purchaser and the Other Purchasers whose Stock and Options are
not purchased in accordance with this Section 11 shall have priority, on a pro
rata basis, over other purchases of Common Stock and Options by the Company
pursuant to this Agreement and Other Purchasers' Agreements.
13
12. Rights to Negotiate Repurchase Price. Nothing in this
Agreement shall be deemed to restrict or prohibit the Company from purchasing
shares of Stock or Options from the Purchaser, at any time, upon such terms and
conditions, and for such price, as may be mutually agreed upon between the
Parties, whether or not at the time of such purchase circumstances exist which
specifically grant the Company the right to purchase, or the Purchaser the right
to sell, shares of Stock or the Company has the right to pay, or the Purchaser
has the right to receive, the Option Excess Price under the terms of this
Agreement.
13. Covenant Regarding 83(b) Election. Except as the Company
may otherwise agree in writing, the Purchaser hereby covenants and agrees that
he will make an election provided pursuant to Treasury Regulation 1.83-2 with
respect to the Stock, including without limitation, the Stock to be acquired
pursuant to Section 1 and the Stock to be acquired upon each exercise of the
Purchaser's Options; and Purchaser further covenants and agrees that he will
furnish the Company with copies of the forms of election the Purchaser files
within 30 days after the date hereof, and within 30 days after each exercise of
Purchaser's Options and with evidence that each such election has been filed in
a timely manner.
14. Notice of Change of Beneficiary. Immediately prior to any
transfer of Stock to a Purchaser's Trust, the Purchaser shall provide the
Company with a copy of the instruments creating the Purchaser's Trust and with
the identity of the beneficiaries of the Purchaser's Trust. The Purchaser shall
notify the Company immediately prior to any change in the identity of any
beneficiary of the Purchaser's Trust.
15. Expiration of Certain Provisions. The provisions contained
in Sections 4, 5 and 6 of this Agreement and the portion of any other provision
of this Agreement which incorporates the provisions of Sections 4, 5 and 6,
shall terminate and be of no further force or effect with respect to any shares
of Stock sold by the Purchaser (i) pursuant to an effective registration
statement filed by the Company pursuant to Section 10 hereof or (ii) pursuant to
the terms of the Sale Participation Agreement of even date herewith, between the
Purchaser and the Parent.
The provisions contained in Section 2(e), 3, 4, 5, 6 and 13 of
this Agreement, and the portion of any other provisions of this Agreement which
incorporate the provisions of such Sections, shall terminate and be of no
further force or effect upon the consummation of a merger, reorganization,
business combination or liquidation of the Company, a sale of Common Stock owned
by the Parent or other transaction, but only if such merger, reorganization,
business combination, liquidation, sale of Common Stock or other transaction
results in KKR Associates, a New York limited partnership, Parent or any
affiliate of either of them, no longer having the power (i) to elect a majority
of the Board of Directors of the Company or such other corporation which
succeeds to the Company's rights and obligations pursuant to such merger,
reorganization, business combination, liquidation or stock sale, or (ii) if the
resulting entity of such merger, reorganization, business combination,
liquidation or stock sale is not a corporation, to select the general partner(s)
or other persons or entities controlling the operations and business of the
resulting entity (a "Change of Control").
16. Recapitalizations, etc. The provisions of this Agreement
shall apply, to the full extent set forth herein with respect to the Stock or
the Options, to any and all shares of
14
capital stock of the Company or any capital stock, partnership units or any
other security evidencing ownership interests in any successor or assign of the
Company (whether by merger, consolidation, sale of assets or otherwise) which
may be issued in respect of, in exchange for, or substitution of, the Stock or
the Options, by reason of any stock dividend, split, reverse split, combination,
recapitalization, liquidation, reclassification, merger, consolidation or
otherwise.
17. Purchaser's Employment by the Company. Nothing contained
in this Agreement or in any other agreement entered into by the Company and the
Purchaser contemporaneously with the execution of this Agreement (i) obligates
the Company or any subsidiary of the Company to employ the Purchaser in any
capacity whatsoever or (ii) prohibits or restricts the Company (or any such
subsidiary) from terminating the employment, if any, of the Purchaser at any
time or for any reason whatsoever, with or without cause, and the Purchaser
hereby acknowledges and agrees that, except as may otherwise be specifically set
forth in a written agreement or written arrangement with Purchaser, neither the
Company nor any other person has made any representations or promises whatsoever
to the Purchaser concerning the Purchaser's employment or continued employment
by the Company.
18. Binding Effect. The provisions of this Agreement shall be
binding upon and accrue to the benefit of the Parties and their respective
heirs, legal representatives, successors and assigns. In the case of a
transferee permitted under Section 2(a) hereof, such transferee shall be deemed
the Purchaser hereunder; provided, however, that no transferee (including
without limitation, transferees referred to in Section 2(a) hereof) shall derive
any rights under this Agreement unless and until such transferee has delivered
to the Company a valid undertaking and becomes bound by the terms of this
Agreement.
19. Amendment. This Agreement may be amended only by a written
instrument signed by the Parties hereto.
20. Closing. Except as otherwise provided herein, the closing
of each purchase and sale of shares of Stock and the payment of the Option
Excess Price, if any, pursuant to this Agreement shall take place at the
principal office of the Company on the tenth business day following delivery of
the notice by either Party to the other of its exercise of the right to purchase
or sell such Stock hereunder or to cause the payment of the Option Excess Price,
if any.
21. Applicable Law; Consent to Jurisdiction; Waivers. The laws
of the state of Delaware shall govern the interpretation, validity and
performance of the terms of this Agreement, regardless of the law that might be
applied under principles of conflicts of law. Any suit, action or proceeding
against the Purchaser with respect to this Agreement, or any judgment entered by
any court in respect of any thereof, may be brought in any court of competent
jurisdiction in the State of Delaware or New York, as the Company may elect in
its sole discretion, and the Purchaser hereby submits to the non-exclusive
jurisdiction of such courts for the purpose of any such suit, action, proceeding
or judgment. By the execution and delivery of this Agreement, the Purchaser
appoints Corporation Services Company, at its office in Wilmington, Delaware or
New York, New York, as the case may be, as his agent upon which process may be
served in any such suit, action or proceeding. Service of process upon such
agent, together with notice of such
15
service given to the Purchaser in the manner provided in Section 24, shall be
deemed in every respect effective service of process upon him in any suit,
action or proceeding. Nothing herein shall in any way be deemed to limit the
ability of the Company to serve any such writs, process or summonses in any
other manner permitted by applicable law or to obtain jurisdiction over the
Purchaser, in such other jurisdictions and in such manner, as may be permitted
by applicable law. The Purchaser hereby irrevocably waives any objections which
he may now or hereafter have to the laying of the venue of any suit, action or
proceeding arising out of or relating to this Agreement brought in any court of
competent jurisdiction in the State of Delaware or New York, and hereby further
irrevocably waives any claim that any such suit, action or proceeding brought in
any such court has been brought in any inconvenient forum. No suit, action or
proceeding against the Company with respect to this Agreement may be brought in
any court, domestic or foreign, or before any similar domestic or foreign
authority other than in a court of competent jurisdiction in the State of
Delaware or New York, and the Purchaser hereby irrevocably waives any right
which he may otherwise have had to bring such an action in any other court,
domestic or foreign, or before any similar domestic or foreign authority. The
Company hereby submits to the jurisdiction of such courts for the purpose of any
such suit, action or proceeding.
22. Assignability of Certain Rights by the Company. The
Company shall have the right to assign any or all of its rights or obligations
to purchase shares of Stock pursuant to Sections 4, 5 and 6; provided, however,
that the Company shall remain obligated to perform its obligations
notwithstanding such assignment in the event that such assignee fails to perform
the obligations so assigned to it.
23. Miscellaneous. In this Agreement (i) all references to
"dollars" or "$" are to United States dollars and (ii) the word "or" is not
exclusive. If any provision of this Agreement shall be declared illegal, void or
unenforceable by any court of competent jurisdiction, the other provisions shall
not be affected, but shall remain in full force and effect.
24. Notices. All notices and other communications provided for
herein shall be in writing and shall be deemed to have been duly given if
delivered by hand (whether by overnight courier or otherwise) or sent by
registered or certified mail, return receipt requested, postage prepaid, to the
Party to whom it is directed:
(a) If to the Company, to it at the following address:
Corning Consumer Products Company
E-Building
Xxxxxxxx Xxxx
Xxxxxxx, Xxx Xxxx 00000
Attn: President
with copies to:
Kohlberg Kravis Xxxxxxx & Co.
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
16
Attn: Xxxxxxx Xxxxxxx and Xxxxx Xxxxxx
-and-
c/x Xxxxxx Capital Management Partners
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxx, Xxxx 00000
Attention: Chief Executive Officer
-and-
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx X. Xxxxxx, Esq.
(b) If to the Purchaser, to him at the address set forth below
under his signature;
or at such other address as either party shall have specified by notice
in writing to the other.
25. Covenant Not to Compete; Confidential Information. (a) In
consideration of the Company entering into this Agreement with the Purchaser,
the Purchaser hereby agrees effective as of the Vesting Reference Date, for so
long as the Purchaser is employed by the Company or one of its subsidiaries and
for a period of one year thereafter (the "Noncompete Period"), that the
Purchaser shall not, directly or indirectly, engage in the production, sale or
distribution of any product produced, sold or distributed by the Company or its
subsidiaries on the date hereof or during the Noncompete Period anywhere in the
world in which the Company or its subsidiaries is doing business other than
through the Purchaser's employment with the Company or any of its subsidiaries.
At the Company's option, the Noncompete Period may be extended for an additional
one year period if (i) within nine months of the termination of the Purchaser's
employment, the Company gives the Purchaser notice of such extension and (ii)
beginning with the first anniversary of such termination, the Company pays the
Purchaser an amount equal to the Purchaser's base salary on the date of the
termination of his employment. Such amount shall be paid in installments in a
manner consistent with the then current salary payment policies of the Company.
For purposes of this Agreement, the phrase "directly or indirectly engage in"
shall include any direct or indirect ownership or profit participation interest
in such enterprise, whether as an owner, stockholder, partner, joint venturer of
otherwise, and shall include any direct or indirect participation in such
enterprise as a consultant, licensor of technology or otherwise.
(b) The Purchaser will not disclose or use at any time during
the Noncompete Period (as such period may be extended pursuant to Section
25(a)), any Confidential Information (as defined below) of which the Purchaser
is or becomes aware, whether or not such information is developed by him, except
to the extent that such disclosure or use is directly related to and required by
the Purchaser's performance of duties, if any, assigned to the Purchaser by the
Company. As used in this Agreement, the term "Confidential Information" means
information that is not generally known to the public and that is used,
17
developed or obtained by the Company or its subsidiaries in connection with its
business, including but not limited to (i) products or services, (ii) fees,
costs and pricing structures, (iii) designs, (iv) computer software, including
operating systems, applications and program listings, (v) flow charts, manuals
and documentation, (vi) data bases, (vii) accounting and business methods,
(viii) inventions, devices, new developments, methods and processes, whether
patentable or unpatentable and whether or not reduced to practice, (ix)
customers and clients and customer or client lists, (x) other copyrightable
works, (xi) all technology and trade secrets, and (xii) all similar and related
information in whatever form. Confidential Information will not include any
information that has been published in a form generally available to the public
prior to the date the Purchaser proposes to disclose or use such information.
The Purchaser acknowledges and agrees that all copyrights, works, inventions,
innovations, improvements, developments, patents, trademarks and all similar or
related information which relate to the actual or anticipated business of the
Company and its subsidiaries (including its predecessors) and conceived,
developed or made by the Purchaser while employed by the Company or its
subsidiaries belong to the Company. The Purchaser will perform all actions
reasonably requested by the Company (whether during or after the Noncompete
Period) to establish and confirm such ownership at the Company's expense
(including, without limitation, assignments, consents, powers of attorney and
other instruments).
(c) Notwithstanding Sections 25(a) and (b) above, if at any
time a court holds that the restrictions stated in such Sections are
unreasonable or otherwise unenforceable under circumstances then existing, the
Parties agree that the maximum period, scope or geographic area determined to be
reasonable under such circumstances by such court will be substituted for the
stated period, scope or area. Because the Purchaser's services are unique and
because the Purchaser has had access to Confidential Information, the Parties
agree that money damages will be an inadequate remedy for any breach of this
Agreement. In the event a breach or threatened breach of this Agreement, the
Company or its successors or assigns may, in addition to other rights and
remedies existing in their favor, apply to any court of competent jurisdiction
for specific performance and/or injunctive relief in order to enforce, or
prevent any violations of, the provisions hereof (without the posting of a bond
or other security).
(d) Notwithstanding the foregoing Sections 25(a), (b) and (c),
the provisions of any employment agreement in effect on the date hereof between
the Company and Purchaser which contains covenants relating to confidentiality
and competition shall supersede and replace the provisions of Sections 25(a),
(b) and (c) and shall be deemed incorporated by reference in this Agreement in
their entirety.
[Continued on next page.]
18
IN WITNESS WHEREOF, the Parties have executed this Agreement
as of April 30, 1998.
CORNING CONSUMER PRODUCTS COMPANY
By:
-----------------------------
Name:
Title:
CCPC ACQUISITION CORP.
By:
-----------------------------
Name:
Title:
------------------------------
(Print Name of Purchaser)
---------------------------------
(Signature of Purchaser)
---------------------------------
---------------------------------
---------------------------------
(Address of Purchaser)
Number of Shares of
Purchase Stock: ---------------------------------
Purchase Date: April 30, 1998
---------------------------------
Vesting Reference Date: April 1, 1998
---------------------------------
Management Stockholder's Agreement
19
