EXHIBIT 10.14
EMPLOYMENT AGREEMENT dated as of January 21, 1997,
between PACKERWARE CORPORATION, a Kansas corporation (the
"Corporation"), and XXXXX X. XXXX (the "Employee").
Pursuant to the terms of the Agreement and Plan of Reorganization dated
as of January 14, 1997 (the "Merger Agreement"), among Xxxxx Plastics
Corporation, a Delaware corporation ("Xxxxx"), PackerWare Acquisition
Corporation, a Kansas corporation ("Acquisition Sub"), PackerWare Corporation, a
Kansas corporation ("PackerWare"), and the stockholders of Packerware, on the
date hereof Acquisition Sub merged with and into PackerWare, with PackerWare
being the surviving corporation (for ease of reference, prior to the merger
PackerWare Corporation is referred to herein as "PackerWare" and after the
merger PackerWare Corporation is referred to herein as the "Corporation"). As a
result of such merger, the Corporation became a wholly-owned subsidiary of
Xxxxx. Prior to the execution hereof, the Employee has been an officer of
Packerware, and after the date hereof, he will be an officer of the Corporation,
and as such has substantial experience that has value to the Corporation. The
Corporation desires to employ the Employee, and the Employee desires to accept
such employment, on the terms and subject to the conditions hereinafter set
forth. Capitalized terms used and not otherwise defined herein shall have the
respective meanings ascribed thereto in the Merger Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and obligations hereinafter set forth, the parties hereto agree as
follows:
1. EMPLOYMENT; TERMINATION OF PREVIOUS AGREEMENT. (a) Effective as of
the date hereof (such date, the "Commencement Date," for all purposes hereof),
the Corporation shall employ the Employee, and the Employee shall accept
employment by the Corporation, upon the terms and conditions hereinafter set
forth.
(b) Reference is made to the Employment Agreement dated September 1994,
as amended on March 5, 1996 (the "Old Employment Agreement"), between the
Employee and PackerWare. The Employee, PackerWare and the Corporation agree that
the Old Employment Agreement is hereby terminated and of no further force or
effect. In addition, the Employee hereby releases and forever discharges
PackerWare and the Corporation from all claims and obligations arising out of
the Old Employment Agreement.
2. TERM. Subject to earlier termination as provided herein, the
employment of the Employee hereunder shall commence on the Commencement Date and
terminate on January __, 2002. Such period of employment is hereinafter referred
to as the "Employment Period."
3. DUTIES. During the Employment Period, the Employee shall be initially
employed by the Corporation as the Vice President-Sales and Marketing,
Housewares, and shall perform such duties and services consistent with such
position as may reasonably be assigned to the Employee by the Chief Executive
Officer of the Corporation or his designees. The Employee will be primarily
responsible for the housewares and lawn and garden sectors of the Corporation's
business, as well as selected aspects of the drink cup business, all as
determined by the Chief Executive Officer of the Corporation.
4. TIME TO BE DEVOTED TO EMPLOYMENT. Except for vacation, absences due
to temporary illness and absences resulting from causes set forth in Section 7,
the Employee shall devote the Employee's business time, attention and energies
on a full-time basis to the performance of the duties and responsibilities
referred to in Section 3. The Employee shall not during the Employment Period be
engaged in any other business activity which, in the reasonable judgment of the
executive officers of the Corporation, would conflict with the ability of the
Employee to perform his duties under this Agreement, whether or not such
activity is pursued for gain, profit or other pecuniary advantage. The
Corporation understands that the Employee is a member of the Board of Directors
and a shareholder of Innovative Interactive Inc. ("Innovative"), a promotion
company, and the Corporation understands and agrees that the Employee may devote
some time and attention to Innovative; PROVIDED, HOWEVER, that the Employee is
still bound by, and must comply with, the provisions of this Agreement
(including, without limitation, this Section 4 and Section 11) notwithstanding
such involvement with Innovative.
5. COMPENSATION; BENEFITS; REIMBURSEMENT.
(A) BASE SALARY. During the Employment Period, the Corporation shall pay
to the Employee an annual base salary of $155,000, which shall be subject to
review and, at the option of persons having authority regarding such matters at
the Corporation, subject to increase (such salary, as the same may be increased
from time to time as aforesaid, being referred to herein as the "Base Salary").
The Base Salary shall be payable in such installments (but not less frequent
than monthly) as is the policy of the Corporation with respect to employees of
the Corporation at substantially the same level of employment as the Employee.
(B) BONUS. During the Employment Period, the Employee shall be entitled
to participate in all bonus and incentive programs of the Corporation (the
"Programs") generally available from time to time to employees of the
Corporation at substantially the same level of employment as the Employee, such
participation to be in substantially the same manner as the participation
therein by such employees.
(C) BENEFITS. During the Employment Period, the Employee shall be
entitled to four weeks vacation per year and such other benefits (together with
the Programs, the "Benefit Arrangements") as are generally made available from
time to time to other employees of the Corporation at substantially the same
level of employment as the Employee. The Benefit Arrangements shall include use
of a vehicle provided by the Corporation.
(D) REIMBURSEMENT OF EXPENSES. During the Employment Period, the
Corporation shall reimburse the Employee, in accordance with the policies and
practices of the Corporation in effect from time to time with respect to other
employees of the Corporation at substantially the same level of employment as
the Employee, for all reasonable and necessary traveling expenses and other
disbursements incurred by him for or on behalf of the Corporation in connection
with the performance of his duties hereunder upon presentation by the Employee
to the Corporation of appropriate documentation therefor.
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(E) DEDUCTIONS. The Corporation shall deduct from any payments to be
made by it to the Employee under this Section 5 or Section 9 any amounts
required to be withheld in respect of any Federal, state or local income or
other taxes.
6. RELOCATION. In no event shall the Employee be required to relocate to
any location more than 50 miles outside of Lawrence, Kansas without the
Employee's prior consent.
7. DISABILITY OR DEATH OF THE EMPLOYEE. (a) If, during the Employment
Period, the Employee is incapacitated or disabled by accident, sickness or
otherwise (hereinafter, a "Disability") so as to render the Employee mentally or
physically incapable of performing the services required to be performed under
this Agreement for 90 days in any period of 360 consecutive days, the
Corporation may, at any time thereafter, at its option, terminate the employment
of the Employee under this Agreement immediately upon giving the Employee notice
to that effect, it being understood that upon such termination the Employee
shall be eligible for the disability benefits provided by the Corporation.
(b) If the Employee dies during the Employment Period, the Termination
Date (as defined below) shall be deemed to be the date of the Employee's death.
8. TERMINATION. (a) The Corporation may terminate the employment of the
Employee and all of the Corporation's obligations under this Agreement (except
as hereinafter provided) at any time for "cause" by giving the Employee notice
of such termination, with reasonable specificity of the grounds therefor. For
the purposes of this Section 8, "cause" shall mean (i) willful misconduct with
respect to the business and affairs of the Corporation or any subsidiary or
affiliate thereof, insubordination or willful neglect of duties (other than
neglect due solely to the Employee's illness or other involuntary mental or
physical disability), including the Employee's violation of any material
Corporation policy, (ii) material breach of any of the provisions of this
Agreement, (iii) conviction for a crime involving moral turpitude or fraud, or
(iv) the material untruth, inaccuracy or breach of any representation or
warranty of PackerWare contained in Section 5 of the Merger Agreement that (A)
results or could reasonably be expected to result in losses, expenses, damages
or other liability incurred by the Corporation in an amount greater than
$250,000 and (B) arose out of facts or circumstances of which the Employee had
knowledge or should have had knowledge in the exercise of his duties as
President of PackerWare. A termination pursuant to this Section 8(a) shall take
effect immediately upon the giving of the notice contemplated hereby.
(b) The Corporation may terminate the employment of the Employee and all
of the Corporation's obligations under this Agreement (except as hereinafter
provided) at any time during the Employment Period without "cause" by giving the
Employee written notice of such termination, to be effective 30 days following
the giving of such written notice.
(c) The Employee may terminate the employment of the Employee hereunder
at any time during the Employment Period by giving the Corporation at least 30
days' prior written notice of such termination, such termination to be effective
on the date specified in such notice, whereupon all of the Corporation's
obligations hereunder shall terminate (except as hereinafter provided). For
convenience of reference, the date upon which any termination of the
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employment of the Employee pursuant to Section 7 or 8 hereof shall be effective
shall be hereinafter referred to as the "Termination Date."
9. EFFECT OF TERMINATION OF EMPLOYMENT. (a) Upon the effective date of
termination of the Employee's employment pursuant to Section 7, Section 8(a) or
Section 8(c) hereof, neither the Employee nor the Employee's beneficiaries or
estate shall have any further rights under this Agreement or any claims against
the Corporation arising out of this Agreement, except the right to receive,
within 30 days of the Termination Date:
(i) the unpaid portion of the Base Salary provided for in
Section 5(a), computed on a PRO RATA basis to the Termination Date;
(ii) reimbursement for any expenses for which the Employee shall
not have theretofore been reimbursed, as provided in Section 5(d); and
(iii) the unpaid portion of any amounts earned by the Employee
prior to the Termination Date pursuant to any Benefit Arrangement;
PROVIDED, HOWEVER, unless specifically provided otherwise in this
Section 9, the Employee shall not be entitled to receive any benefits
under a Benefit Arrangement that have accrued during a fiscal year if
the terms of such Benefit Arrangement require that the beneficiary be
employed by the Corporation as of the end of such fiscal year.
(b) Upon the termination of the Employee's employment pursuant to
Section 8(b), neither the Employee nor the Employee's beneficiaries or estate
shall have any further rights under this Agreement or any claims against the
Corporation arising out of this Agreement, except the right to receive:
(i) the unpaid portion of the Base Salary, computed on a PRO
RATA basis, for the period from the Commencement Date until the later to
occur of (A) the third anniversary of the Commencement Date or (B) the
first anniversary of the Termination Date (as defined in Section 8(c)),
payable in such installments as the Base Salary was paid prior to the
Termination Date (it being understood and agreed that all of such
installments shall be paid regardless of whether the Employee is
subsequently employed, provided that such employment does not violate
the provisions of Section 11 hereof);
(ii) the amount of the bonus payment, if any, attributable to
the fiscal year during which the Termination Date occurred, computed on
a PRO RATA basis, payable at such time as the bonus payment is
customarily paid by the Corporation to its employees; and
(iii) the payments, if any, referred to in Sections 9(a)(ii) and
(iii), to the extent not covered by Sections 9(b)(i) and (ii) above.
(c) The Employee's obligations under Sections 10, 11 and 12 of this
Agreement, and the Corporation's obligations under this Section 9, shall survive
the termination of this Agreement and the termination of the Employee's
employment hereunder.
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10. DISCLOSURE OF INFORMATION. (a) From and after the date hereof, the
Employee shall not use or disclose to any person, firm, corporation or other
business entity (other than any officer, director, employee, affiliate or
representative of the Corporation), except as required in connection with the
performance of the Employee's duties under and in compliance with the terms of
this Agreement and as required by law or judicial process, any Confidential
Information (as hereinafter defined) for any reason or purpose whatsoever, nor
shall the Employee make use of any of the Confidential Information for the
Employee's purposes or for the benefit of any person or entity except the
Corporation or any subsidiary thereof.
(b) For purposes of this Agreement, "Confidential Information" shall
mean (i) the Intellectual Property Rights (as hereinafter defined) of the
Corporation and its subsidiaries and (ii) all other information of a proprietary
or confidential nature relating to the Corporation or any subsidiary thereof, or
the business or assets of the Corporation or any such subsidiary, including,
without limitation, books, records, customer and registered user lists, vendor
lists, supplier lists, distribution channels, pricing information, cost
information, marketing plans, strategies, forecasts, financial statements,
budgets and projections, other than information which is generally within the
public domain at the time of the receipt thereof by the Employee or at the time
of use or disclosure of such Confidential Information by the Employee other than
as a result of the breach by the Employee of the Employee's agreement hereunder.
(c) As used herein, the term "Intellectual Property Rights" means all
industrial and intellectual property rights, including, without limitation,
patents, patent applications, patent rights, trademarks, trademark applications,
trade names, service marks, service xxxx applications, copyrights, copyright
applications, know-how, certificates of public convenience and necessity,
franchises, licenses, trade secrets, proprietary processes and formulae,
inventions, development tools, marketing materials, instructions, confidential
information, trade dress, logos and designs and all documentation and media
constituting, describing or relating to the foregoing, including, without
limitation, manuals, memoranda and records.
11. RESTRICTIVE COVENANTS. (a) The Employee acknowledges and recognizes
that during the Employment Period he will be privy to Confidential Information
and further acknowledges and recognizes that the Corporation would find it
extremely difficult to replace the Employee. Accordingly, in consideration of
the premises contained herein and the consideration to be received by the
Employee hereunder (including, without limitation, the severance compensation
described in Section 9(b)(i), if any), without the prior written consent of the
Corporation, the Employee shall not, at any time during the employer/employee
relationship between the Corporation and the Employee and the period beginning
on the date of termination of such employer/employee relationship and ending on
the later to occur of (x) the third anniversary of the Commencement Date and (y)
the first anniversary of such date of termination, (i) directly or indirectly
engage in, represent in any way, or be connected with, any Competing Business
directly competing with the business of the Corporation or any subsidiary or
affiliate thereof within the state in which the Employee is employed or any
other state of the United States, whether such engagement shall be as an
officer, director, owner, employee, partner, affiliate or other participant in
any Competing Business, (ii) assist others in engaging in any Competing Business
in the manner described in clause (i) above, (iii) induce other employees of the
Corporation or any subsidiary or affiliate thereof to terminate their employment
with the Corporation or any such subsidiary or affiliate or to engage in any
Competing Business or (iv)
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induce any entity or person with which the Corporation or any subsidiary or any
affiliate thereof has a business relationship, contractual or otherwise, to
terminate or alter such business relationship.
(b) As used herein, "Competing Business" shall mean any business
involving the sale of products in any city or county in any state of the United
States if such business or the products sold by it are competitive, directly or
indirectly, at the time of the Termination of Employment with (i) the business
of the Corporation or any subsidiary or affiliate thereof, (ii) any of the
products manufactured, sold or distributed by the Corporation or any subsidiary
or affiliate thereof or (iii) any products or business being developed or
conducted by the Corporation or any subsidiary or affiliate thereof.
(c) The Employee understands that the foregoing restrictions may limit
his ability to earn a livelihood in a business similar to the business of the
Corporation or any subsidiary or affiliate thereof, but he nevertheless believes
that he has received and will receive sufficient consideration and other
benefits as an employee of the Corporation, under the terms of the Merger
Agreement and as otherwise provided hereunder to justify clearly such
restrictions which, in any event (given his education, skills and ability), the
Employee does not believe would prevent him from earning a living.
12. RIGHT TO INVENTIONS. The Employee shall promptly disclose, grant and
assign to the Corporation for its sole use and benefit any and all inventions,
improvements, technical information and suggestions reasonably relating to the
business of the Corporation or any subsidiary or affiliate thereof
(collectively, the "Inventions") which the Employee may develop or acquire
during the period of the employer/employee relationship between the Corporation
and the Employee (whether or not during usual working hours), together with all
patent applications, letters patent, copyrights and reissues thereof that may at
any time be granted for or upon the Inventions. In connection therewith:
(a) the Employee recognizes and agrees that the Inventions shall be the
sole property of the Corporation, and the Corporation shall be the sole owner of
all patent applications, letters patent, copyrights and reissues thereof that
may at any time be granted for or on the Inventions;
(b) the Employee hereby assigns to the Corporation any rights the
Employee may have in or acquire to the Inventions;
(c) the Employee shall, at the expense of the Corporation, promptly
execute and deliver such applications, assignments, descriptions and other
instruments as may be necessary or proper in the opinion of the Corporation to
vest title to the Inventions and any patent applications, patents, copyrights,
reissues or other proprietary rights related thereto in the Corporation and to
enable it to obtain and maintain the entire right and title thereto throughout
the world;
(d) the Employee recognizes and agrees that the Inventions to the extent
copyrightable shall constitute works for hire under the copyright laws of the
United States; and
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(e) the Employee shall render to the Corporation, at its expense, all
such assistance as it may require in the prosecution of applications for said
patents, copyrights, reissues or other proprietary rights, in the prosecution or
defense of interferences which may be declared involving any said applications,
patents, copyrights or other proprietary rights and in any litigation in which
the Corporation may be involved relating to the Inventions.
13. MISCELLANEOUS PROVISIONS.
(A) ENTIRE AGREEMENT; AMENDMENTS. This Agreement and the other
agreements referred to herein contain the entire agreement between the parties
hereto with respect to the transactions contemplated hereby and supersede all
prior agreements or understandings between the parties with respect thereto
(including, without limitation, the Old Employment Agreement). This Agreement
shall not be altered or otherwise amended except pursuant to an instrument in
writing signed by each of the parties hereto.
(B) DESCRIPTIVE HEADINGS. Descriptive headings are for convenience only
and shall not control or affect the meaning or construction of any provision of
this Agreement.
(C) NOTICES. All notices or other communications pursuant to this
Agreement shall be in writing and shall be deemed to be sufficient if delivered
personally, telecopied, sent by nationally-recognized, overnight courier or
mailed by registered or certified mail (return receipt requested), postage
prepaid, to the parties at the following addresses (or at such other address for
a party as shall be specified by like notice):
(i) if to the Corporation, to:
PackerWare Corporation
c/o Berry Plastics Corporation
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Telecopier: (000) 000-0000;
with a copy to:
X'Xxxxxxxx Graev & Karabell, LLP
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxx X'Xxxxx, Esq.
Telecopier: (000) 000-0000; and
(ii) if to the Employee, to:
Xxxxx X. Xxxx
00000 Xxxxxxxx
Xxxxxxx, Xxxxxx 00000
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All such notices and other communications shall be deemed to have been delivered
and received (A) in the case of personal delivery, on the date of such delivery,
(B) in the case of delivery by telecopy, on the date of such delivery, (C) in
the case of delivery by nationally-recognized, overnight courier, on the
Business Day following dispatch, and (D) in the case of mailing, on the third
Business Day following such mailing. As used herein, "Business Day" shall mean
any day that is not a Saturday, Sunday or a day on which banking institutions in
New York, New York are not required to be open.
(D) COUNTERPARTS. This Agreement may be executed in any number of
counterparts, and each such counterpart shall be deemed to be an original
instrument, but all such counterparts together shall constitute but one
agreement.
(E) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the domestic laws of the state of Kansas without giving effect
to any choice or conflict of law provision or rule (whether of the State of
Kansas or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of Kansas.
(F) BENEFITS OF AGREEMENT; ASSIGNMENT. The terms and provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors, assigns, representatives, heirs and estate, as
applicable. Anything contained herein to the contrary notwithstanding, this
Agreement shall not be assignable by any party hereto without the consent of the
other party hereto.
(G) WAIVER OF BREACH. The waiver by either party of a breach of any
provision of this Agreement by the other party must be in writing and shall not
operate or be construed as a waiver of any subsequent breach by such other
party.
(H) SEVERABILITY. In the event that any provision of this Agreement is
determined to be partially or wholly invalid, illegal or unenforceable in any
jurisdiction, then such provision shall, as to such jurisdiction, be modified or
restricted to the extent necessary to make such provision valid, binding and
enforceable, or if such provision cannot be modified or restricted, then such
provision shall, as to such jurisdiction, be deemed to be excised from this
Agreement; PROVIDED, HOWEVER, that the binding effect and enforceability of the
remaining provisions of this Agreement, to the extent the economic benefits
conferred upon the parties by virtue of this Agreement remain substantially
unimpaired, shall not be affected or impaired in any manner, and any such
invalidity, illegality or unenforceability with respect to such provisions shall
not invalidate or render unenforceable such provision in any other jurisdiction.
(I) REMEDIES. All remedies hereunder are cumulative, are in addition to
any other remedies provided for by law and may, to the extent permitted by law,
be exercised concurrently or separately, and the exercise of any one remedy
shall not be deemed to be an election of such remedy or to preclude the exercise
of any other remedy. The Employee acknowledges that in the event of a breach of
any of the Employee's covenants contained in Section 10, 11 or 12, the
Corporation shall be entitled to immediate relief enjoining such violations in
any court or before any judicial body having jurisdiction over such a claim.
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(J) SURVIVAL. Sections 9 through 12, this Section 13 and the defined
terms used in any section referred to in this Section 13(j), shall survive the
termination of the Employee's employment on the Termination Date and the
expiration of this Agreement.
* * * *
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IN WITNESS WHEREOF, the parties have duly executed this Employment
Agreement as of the date first above written.
PACKERWARE CORPORATION
By: /S/ XXXXX X. XXXXXXXXXX
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Xxxxx X. Xxxxxxxxxx
Vice President, Chief Financial Officer,
Secretary and Treasurer
THE EMPLOYEE:
/S/ XXXXX X. XXXX
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Xxxxx X. Xxxx
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