EXHIBIT 6
TERMINATION AGREEMENT
THIS TERMINATION AGREEMENT is made and entered into by and between Xxx
X. Xxxxxxxxx (hereinafter referred to as "Employee"), Wedco, Inc., a New Jersey
corporation and wholly-owned subsidiary of ICO, Inc. ("Wedco") and ICO, Inc.
(hereinafter referred to as the "Company").
WITNESSETH:
WHEREAS, Wedco and Employee are parties to an Amended and Restated
Employment Agreement dated August 11, 1999 (as amended, the "Employment
Agreement"); and
WHEREAS, the Company and Wedco desire to terminate Employee's
employment by and position as an officer of Wedco and any and all other
subsidiaries and affiliates of the Company and Employee has consented to such
termination; and
WHEREAS, the termination of Employee's employment is being effected by
mutual agreement of Employee, Wedco and the Company and is not intended to
constitute termination for "Cause" as defined in the Employment Agreement; and
WHEREAS, Employee is willing to resign from all other positions with
the Company, Wedco and their respective subsidiaries and affiliates (other than
those from which he is being terminated) and the Company and Wedco are willing
to accept such resignation; and
WHEREAS, Employee, Wedco and the Company desire to modify certain of
their obligations in connection with such termination of employment from those
set forth in the Employment Agreement; and
WHEREAS, Employee, Wedco and the Company mutually desire to avoid and
resolve any and all actual and potential differences between them;
NOW, THEREFORE, in consideration of the premises and mutual promises
herein contained, it is mutually agreed as follows:
FIRST: The Company and Wedco hereby terminate Employee as an employee
(including as Senior Vice President - Corporate Administration) of Wedco,
effective immediately, and Employee hereby consents to such termination. In
addition, Employee hereby tenders, and the Company and Wedco hereby accept,
Employee's immediate resignation from all other offices, directorships and
committee memberships of any and all subsidiaries and affiliates of the Company
and all committees thereof; provided, however, that nothing herein will require
resignation from any officer, directorships or positions, if any, held in
Pacholder Associates, Inc. or the Pacholder High Yield Fund.
SECOND: In any and all press releases and other public communications
made by any party, the stated reason for Employee's termination as an employee
and officer shall be the desire of Employee, the Company and Wedco to avoid
conflict among the members of the Company's board of directors; provided,
however, that neither the making of such statements nor Employee's termination
are to be construed as meaning or suggesting that Employee has been terminated
for reason of his age. Employee shall be afforded the opportunity to review and
comment on any press release with respect to this Termination Agreement or his
termination of employment at least one day in advance of the actual release
thereof. The Company, Wedco and Employee hereby agree not to make any
disparaging or intentionally false or misleading statements (or encourage others
to make any such statements) regarding the other. The preceding sentence shall
not apply to any statements required to be made by applicable law or to avoid
perjury.
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THIRD: The Company and Wedco acknowledge and agree that Employee's
termination of employment is not as a result of Disability and is not intended
to be as a result of any action that would constitute Cause (as such terms are
defined in the Employment Agreement). Notwithstanding the terms of Section
6(d)(i) of the Employment Agreement (which if applied would result in a
substantially higher payment), as consideration for Employee's termination the
Company shall pay Employee at the time of execution of this Termination
Agreement by Employee the Termination Amounts set forth on Annex A attached
hereto (subject to applicable withholding) by wire transfer of immediately
available funds.
Employee also shall be entitled to the other rights and benefits under
the Employment Agreement (including but not limited to those set forth in
Section 9) arising or due as a result of the termination of his employment other
than for Cause or Disability (as defined in the Employment Agreement) and shall
be subject to his continuing obligations thereunder. For purposes of the
application of Section 9 of the Employment Agreement and calculation of the
Gross-Up Payment, Employee hereby represents and warrants that his "base
amount," within the meaning of Section 280G(b)(3) as calculated in accordance
with Section 280(G) of the Internal Revenue Code of 1986, as amended, is the
amount reflected as the "base amount" on Annex A attached hereto. The Company
and Employee have agreed that the value of any "parachute payments," within the
meaning of Section 280G(b)(2) paid or payable to Employee pursuant to this
Termination Agreement, the Employment Agreement (as modified hereby) or
otherwise, excluding the Principal Severance Payment (as reflected on Annex A)
and the Gross-Up Payment will be the "Parachute Payment Value" set forth on
Annex A. Employee has agreed to such value for purposes of the initial
determination of the Gross-Up Payment under Section 9 of the Employment
Agreement. Employee agrees that, for purposes of such calculation, in addition
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to the tax imposed under Section 280G, the parties shall assume that Employee
pays and will pay a combined federal, state and local tax rate of 39%. The
Company and Employee have agreed in a separate Escrow Agreement entered into in
connection with this Agreement to escrow certain monies to be available to
Employee if the Gross-Up Payment is hereafter required to be paid.
In addition to the monetary payments provided for above, the Company or
Wedco, as the case may be, shall transfer to Employee ownership of the Company
car he is currently using, his office computer, telecopy machine, printer and
mobile phone and the professional books acquired by the Company for Employee's
use all as more particularly described on Annex B attached hereto, in each case
free and clear of any liens or other encumbrances. The Company shall also
provide Employee, at the Company's expense, with the services of an
out-placement consulting firm for a period of one year provided the costs to the
Company in this regard will not exceed $9,000.
The Company and Wedco, as the case may be, may withhold from any
amounts payable under this Termination Agreement such federal, state and local
taxes as shall be required to be withheld pursuant to any applicable law or
regulation.
FOURTH: The Company acknowledges and agrees that Employee is and will
continue to be entitled to indemnification as provided in the Company's bylaws
and that no amendment of such bylaws after the date hereof will be effective as
applied to Employee if it would adversely affect his rights to indemnification.
The Company also acknowledges and agrees that it is not aware of any fact or
circumstance that would disqualify Employee from satisfying the requirements
necessary to permit the Company's indemnification of Employee as set forth in
the Texas Business Corporation Act. The Company also agrees, for a period of
five years following the date hereof, to use commercially reasonable best
efforts to maintain directors and officers
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liability insurance providing coverage substantially the same as or better than
that currently maintained by the Company; provided that if the cost of
maintaining such insurance would exceed twice the cost currently being incurred
by the Company therefor, the Company shall only be required to maintain
directors and officers liability insurance providing the maximum coverage that
can be obtained for a cost that is twice the amount currently being incurred.
FIFTH: In consideration of the payments and agreements contained in
this Termination Agreement, and with the exception of rights created by or
pursuant to this Termination Agreement or the Employment Agreement (as modified
hereby), Employee, on his own behalf and on behalf of his affiliates, agents,
legal representatives, heirs, successors and assigns (the "Employee Parties"),
does hereby fully and forever release, acquit, forgive and forever discharge the
Company, Wedco and their respective subsidiaries, affiliates, directors,
officers, agents, legal representatives, successors and assigns (the "Company
Parties") from any and all claims, demands and causes of action whatsoever, of
every name, nature of description, whether arising out of contract, tort or
otherwise and whether based on common law, statute or administrative regulation,
and whether known or unknown, which Employee now has or might have, in any way
relating to Employee's service or capacity as a director or officer of, or his
employment by, Wedco, the Company or any subsidiary or affiliate of the Company.
Without in any way limiting the foregoing, Employee waives and releases Wedco,
the Company and its subsidiaries and affiliates from any claims that Employee
could assert, known or unknown, in connection with Section 6(d)(i) of the
Employment Agreement, and acknowledges that this Termination Agreement
extinguishes and replaces Section 6(d)(i) of the Employment Agreement with the
provisions of this Termination Agreement. In addition, the Employee hereby
renounces, effective as of the date hereof, all of the Employee's respective
rights, in whatever capacity
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(whether personal or as an officer or director of the Company or any subsidiary
or affiliate), granted under any proxy or agreement to vote any shares of common
stock of the Company or any subsidiary or affiliate held by other persons, and
shall take all such further actions as the Company may reasonably request from
time to time to evidence such renunciation of, or to cause such voting rights to
be revested in the persons of the grantors under, such proxies or agreements.
SIXTH: In consideration of the mutual promises and agreements contained
in this Termination Agreement, and with the exception of rights created by or
pursuant to this Termination Agreement and the Employment Agreement (as modified
hereby), the Company, on its own behalf and on behalf of the other Company
Parties, does hereby fully and forever release, acquit, forgive and discharge
Employee and the other Employee Parties from any and all claims, demands and
causes of action whatsoever, of every name, nature of description, whether
arising out of contract, tort or otherwise and whether based on common law,
statute or administrative regulation, and, whether known or unknown, which the
Company or any Company Party now has or might have, in any way relating to
Employee's service or capacity as a director or officer of, or his employment
by, Wedco, the Company or any of its subsidiaries or affiliates or the
termination of any such service or employment.
SEVENTH:
(a) Each party hereto agrees that, following execution of this
Termination Agreement, such party will not disclose the terms hereof, to any
other person, except in the case where, and only to the extent that, there is a
bona fide need for such disclosure to a third party, such as in connection with
obtaining advice or furnishing personal financial information, and, in each such
case, only on the condition that such other person keeps such information
strictly
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confidential. The foregoing obligations of confidentiality shall not apply to
information that is required to be disclosed as a result of any applicable law,
rule or regulation of any governmental authority or any court.
(b) Employee agrees that he will keep confidential and will not,
directly or indirectly, use for himself or use for, or disclose to, any person,
any information, data or technology regarding the business or operations of the
Company, or any subsidiary or affiliate of the Company including, without
limitation, any strategy, information, data or technology regarding costs, uses,
methods, applications, customers, accounts, suppliers, apparatus, process,
system, or other method at any time used, developed or investigated by or for
the Company, or any subsidiary or affiliate of the Company, whether or not
invented, developed, acquired, discovered or investigated by Employee. The
foregoing disclosure restrictions shall not apply when disclosure is required of
Employee pursuant to a subpoena or order issued by a court or governmental
agency of competent jurisdiction, provided that detailed notice of such subpoena
or order is first given to the Company so to provide the Company a reasonable
opportunity to challenge or object to such subpoena or order and in no event
will Employee be permitted to provide copies of written documentation pertaining
to the Company to any third party. Furthermore, Employee agrees to utilize and
assert any and all applicable privileges regarding any requested disclosure
respecting the Company. The provisions of this subsection (b) supercede the
confidentiality covenant contained in Article 10 of the Employment Agreement.
(c) Employee shall immediately deliver and return to the Company all
books, records, memoranda, plans, computer discs (and transcripts or copies
thereof), correspondence, studies and reports, operating projections, trade
secrets, customer lists and other documents of
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any kind and character relating to the Company or its subsidiaries or affiliates
or their respective business operations made or compiled by, delivered to, or
otherwise acquired by Employee.
(d) Except with the express prior written consent of the Company which
may be withheld in the Company's sole discretion, Employee will not retain any
copies of all or any portion of the information or data referenced in
subsections (b) and (c) above.
(e) Except as otherwise provided in the third paragraph of Section
THIRD above, Employee agrees to immediately return all other Company property
under his possession or control, including, without limitation, all Company
identification, parking cards, access cards, travel authority cards, keys and
credit cards to the Company.
EIGHTH: Employee will not, directly or indirectly, whether for his own
account or for the account of any other person:
(a) for a period of six months following the date hereof, do anything
which would interfere with or divert from the Company any trade, business or
business opportunity with (i) any individual or entity with whom Employee has
had any contact or association during his tenure with the Company or its
subsidiaries or affiliates or (ii) any individual or entity whose identity was
confidential and learned by Employee while an employee or officer of the Company
or its subsidiaries or affiliates provided nothing herein limits the application
of Section SEVENTH above;
(b) for a period of two years following the date hereof, either for
himself or as an investor, director, officer, principal, agent, employee,
advisor, partner, or in any corporate, individual or representative capacity,
solicit, induce or attempt to induce any individual
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employed by the Company or one of its subsidiaries or affiliates to leave the
employment of the Company or such subsidiary or affiliate;
(c) for a period of six months following the date hereof, engage in or
carry on, directly or indirectly, either for himself or as a member of a
partnership or as a stockholder or a equity holder (except as a stockholder of
less than one percent (1%) of the issued and outstanding stock of a publicly
held corporation), investor, officer, or director of a corporation or other
entity or as an employee, agent, associate or consultant of any person,
partnership, corporation or other entity, any business within 150 miles of any
office of the Company or its subsidiaries or affiliates and which is in
competition with the business of the Wedco segment/division of the Company as
conducted on or contemplated as of the date hereof; or
(d) do anything that could reasonably be expected to harm the
relationship enjoyed by the Company or its affiliates with any individual
(including any employee or officer of the Company or its subsidiaries or
affiliates) or entity who or which has provided financing, equipment, materials,
supplies and/or services to the Company or its subsidiaries or affiliates prior
to the date hereof.
NINTH: Employee shall on or prior to the effective date of this
Agreement, submit all actual, reasonable and customary expenses theretofore
incurred by Employee in the course of Employee's employment with proper
documentation, which, upon verification, the Company shall reimburse promptly in
accordance with the Company's reimbursement policy. Employee acknowledges and
agrees that Employee has not and has no authority to incur any expenses after
the date Employee executes this Agreement, and further agrees that,
notwithstanding the provisions of the Employment Agreement, the Company shall
have no obligation to reimburse expenses not submitted within the time set forth
above or incurred after the date hereof.
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TENTH: Employee understands and acknowledges that he:
(i) has received and has read this Termination Agreement;
(ii) is fully informed of and fully understands the terms and
meaning of the terms, conditions and effect of signing this
Termination Agreement;
(iii) has had ample opportunity to ask questions of Company
personnel and that the Company advised him and hereby advises
him in writing to consult with an attorney of his choice prior
to executing this Termination Agreement;
(iv) has relied solely on his own judgment and on the advice of
such counselors and advisors with whom he has considered it
appropriate, desirable, or necessary to consult in making the
decision to sign this Termination Agreement, and Employee
represents and acknowledges that in executing this Termination
Agreement he does not rely and has not relied upon any
representation or statement made by the Company, or by any of
the Company's agents, shareholders, directors, attorneys, or
representatives with regard to the subject matter, basis, or
effect of this Termination Agreement or otherwise, other than
those specifically stated in this written Termination
Agreement;
(v) has made his decision voluntarily without any pressure from
the Company or its employees either to accept or reject this
Termination Agreement;
(vi) had twenty-one days to consider this Termination Agreement if
he chose to do so, and that no one hurried him into executing
this Termination Agreement during that 21-day period, or
otherwise coerced him into executing this Termination
Agreement;
(vii) has seven days following his execution of this Termination
Agreement to revoke such acceptance;
(viii) must make any such revocation of his prior acceptance of this
Termination Agreement in writing and cause such revocation,
together with a cashier's check in the amount of the lump sum
payment received by him pursuant to Section THIRD, to be
delivered to the Company at 00000 Xxxxxxxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxx 00000;
(ix) he fully understands that he is, through this Termination
Agreement, releasing the Company from any and all claims he
may have against the Company and the other parties specified
in Section FIFTH, and that this Termination Agreement
constitutes a release and discharge of claims arising under
the 29 U.S.C. Sections 621-634, including the Older Workers'
Benefit Protection Act, 29 U.S.C. Sections 626(f); and
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(x) he acknowledges that, because he has waived his rights under
Sections 6(d)(i) of the Employment Agreement, the payments and
other benefits that he will receive in accordance with Section
THIRD of this Termination Agreement constitutes something of
value to which Employee would not be entitled to receive if he
did not agree to give the Company a release of claims.
ELEVENTH: If within seven days following Employee's acceptance of this
Termination Agreement, Employee revokes such acceptance in accordance with
clauses (vii) and (viii) of Section TENTH, then all of the rights and
obligations of the parties hereunder shall be deemed rescinded and the parties
shall be restored to their respective positions, offices, rights and obligations
as they existed immediately prior to execution of this Termination Agreement.
TWELFTH: This Termination Agreement is made and entered into in the
State of Texas, and, except to the extent that federal law controls the
interpretation or enforceability of any provision in this Termination Agreement
in which case any such provision shall be construed and enforced in accordance
with federal law, shall in all respects be interpreted, enforced and governed
under the laws of the State of Texas. The language of all parts of this
Termination Agreement shall in all cases be construed as a whole, according to
its fair meaning, and not strictly for or against any of the parties. Any claim
or controversy of whatever nature arising from or relating in any way to this
Termination Agreement, the Employment Agreement, the employment relationship
between the Company and Employee or the cessation of such relationship,
including disputes arising under the common law or federal or state statutes,
laws or regulations and disputes with respect to the arbitrability of any claim
or controversy, shall be resolved exclusively by final and binding arbitration
before a single experienced employment arbitrator selected in accordance with
the Employment Dispute Resolution ("EDR") Rules of the American Arbitration
Association ("AAA") unless the parties hereto shall agree otherwise in writing.
The arbitration will be conducted in Houston, Texas (or in such other place as
may be
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mutually agreed by the parties) pursuant to the EDR Rules of the AAA, and the
arbitrator shall have full authority to award or grant all remedies provided by
law. The judgment upon the award may be enforced by any court having
jurisdiction thereof. Each party shall pay the fees of their respective
attorneys, the expenses of their witnesses, and any other expenses incurred by
such party in connection with the arbitration; provided, however, that the
Company shall pay for the fees of the arbitrator and the administrative and
filing fees charged by the AAA.
THIRTEENTH: Should any provision of this Termination Agreement be
declared or be determined by any court to be unenforceable or invalid as
drafted, it may and shall be reformed or modified by a court of competent
jurisdiction to the form of an enforceable and valid provision that achieves, to
the greatest extent possible, the result intended by the parties in drafting and
agreeing to the unenforceable and invalid provision. Should a court of competent
jurisdiction decline to so reform or modify such a provision or determine that
no enforceable and valid provision can be created to achieve the intended
result, the unenforceability and invalidity of the remaining parts, terms or
provisions of this Termination Agreement shall not be affected thereby and said
unenforceable or invalid part, term, or provision shall be deemed not to be a
part of this Termination Agreement.
FOURTEENTH: This Termination Agreement, together with the Employment
Agreement (as modified hereby) and the Escrow Agreement, set forth the entire
agreement between the parties hereto, and supersede any and all other prior
agreements or understanding between the parties hereto pertaining to the subject
matter hereof. This Termination Agreement shall be binding on and inure to the
benefit of Wedco, the Company and their respective successors and assigns, and,
in the event of Employee's death or incapacity, shall inure to the benefit of
Employee's estate or other legal representatives.
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EXECUTED on the 6th day of June, 2001, but effective as of 12:01 a.m.
(central time) on the 7th day of June, 2001. ICO, INC.
By: /s/ XXX X. XXXX
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Name: Xxx X. Xxxx
-------------------------------------
Title: Senior Vice President,
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Chief Accounting and Treasurer
------------------------------------
/s/ XXX X. XXXXXXXXX
------------------------------------------
XXX X. XXXXXXXXX
WEDCO, INC.
By: /s/ XXX X. XXXX
---------------------------------------
Name: Xxx X. Xxxx
-------------------------------------
Title: Treasurer
------------------------------------
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ANNEX A
TO
TERMINATION AGREEMENT
(X. Xxxxxxxxx)
I. TERMINATION PAYMENTS:
Principal Severance Payment: $ 384,541
Legal Fees and Related Expenses: $ 9,000
Accrued Unpaid Vacation $ 9,231
II. GROSS-UP PAYMENT COMPONENTS:
Base Amount: $ 80,629
Parachute Payment Value: $ 65,140
III. POTENTIAL GROSS-UP PAYMENT: $ 189,500
ANNEX B
TO
TERMINATION AGREEMENT
(X. Xxxxxxxxx)
Car: 2000 Audi A6 2.7
Office computer: Dell laptop
Printer: Hewlett Packard inkjet
Mobile Phone: Motorola StarTac
Professional Books: None
