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EXHIBIT 10.5
MANAGEMENT AGREEMENT
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This Agreement made and entered into as of the 11th day of
August, 1995, by and between Petrolite Corporation, a Delaware
Corporation, 000 Xxxxxxxx Xxxxxx, Xx. Xxxxx, XX 00000 (the
"Company"), and Xxxx X. Xxxxxxxx, 00000 Xxxxxxxxxxx Xxxxx,
Xxxxx 000, Xx. Xxxxx, Xxxxxxxx 00000 (the "Manager").
WITNESSETH:
WHEREAS, the Company desires to engage the services of Manager
in accordance with the terms and conditions of this Agreement; and
WHEREAS, Manager desires to perform services for the Company
in accordance with the terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the mutual promises and
agreements herein contained, the parties hereto agree as follows:
1. SCOPE OF WORK. The Manager shall provide management
services to the Company, particularly with regard to the Company's
Chemicals Group. The Manager shall report to the Chief Executive
Officer of the Company but shall be free to set his own hours.
2. PAYMENT. In consideration of the services to be provided
hereunder, the Company shall pay Manager, during the term of this
Agreement, the sum of $125,000, payable in 12 monthly installments
in accordance with the Company's general practice, beginning
August 31, 1995. In addition, Company shall offer to enter into
that certain Stock Option Agreement of even date attached hereto as
Exhibit A and incorporated by reference herein. Manager shall not
be entitled to any other compensation or remuneration for his
services provided hereunder.
3. INDEPENDENT CONTRACTOR. Manager shall be an independent
contractor with respect to Manager's performance of all services
rendered hereunder and Manager shall not be deemed for any purpose
to be an employee, agent, servant or representative of Company in
the performance of any service hereunder. The actual performance
and superintendence of all services performed hereunder shall be by
Manager.
4. TAXES. Manager shall pay all taxes, licenses and fees
levied or assessed against Manager in connection with or incident
to Manager's performance of this Agreement by any governmental
agency for unemployment compensation insurance, old age benefits,
social security, or any other taxes upon the remuneration of
Manager. Should Manager fail to pay any such tax or governmental
charge Company may, but shall not be required to, make such payment
for the account of Manager. In such event, Manager agrees to
furnish Company with all information required to enable Company to
make any such payments or reports and Manager shall reimburse
Company promptly for all such amounts paid by Company.
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5. REIMBURSEMENT OF EXPENSES. Company will reimburse
Manager for reasonable travel and other expenses incurred by
Manager in connection with the services provided by Manager
hereunder upon Company's approval of Manager's written submission
of an itemized account of such expenses.
6. TERM. This Agreement shall become effective on the day
referenced above, and shall continue in force and effect through
August 10, 1996, unless terminated earlier by either party as
provided herein. Either party may terminate this Agreement by
giving the other party 60 calendar days' notice in writing to that
effect at the respective address set forth above. Such
termination, however, shall not relieve either party of its
liabilities arising from or incident to services performed prior to
termination of this Agreement. Manager shall be entitled only to
that remuneration accrued or vested prior to such date of
termination.
7. SPECIAL COVENANTS BY MANAGER.
A. Covenant Not to Compete. Manager acknowledges
expressly that Company has developed and established a
valuable and extensive worldwide trade in its products and
that its customers, which have been established and maintained
at substantial expense, are of great value to the Company. In
further consideration for the covenants and agreements of
Company herein set forth, Manager covenants to Company that
neither he nor any corporation, partnership, business firm or
entity in which he may now or hereafter have an equity
interest (excepting a publicly-traded corporation in which he
has a less than 1% interest for investment purposes), or by
which he may be employed or otherwise affiliated as an
employee, representative, consultant or otherwise, nor any
person subject to his control or direction will, during the
"Period of this Covenant" as hereafter defined, within the
"Trade Area" hereafter specified, directly or indirectly:
i. Conduct, engage in, be connected with, have
any interest in, consult for, or aid or assist in any
manner any person, firm or business entity (whether a
corporation, partnership, proprietorship or otherwise) in
engaging in the development, manufacture, distribution,
sale or application of services or products like or
similar to any services or products now being developed,
manufactured, marketed or distributed by Company or any
of its affiliates, or which may be developed,
manufactured, marketed or distributed by Company or any
of its affiliates at any time during Manager's employment
with Company or any of its affiliates; or
ii. In any way, directly or indirectly, solicit,
divert, take away or interfere with any of the business,
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customers, trade or patronage of Company or its
subsidiaries or affiliates; or
iii. Seek to employ any person who was an employee
of Company or any of its affiliates during the twelve
(12) months immediately preceding Manager's termination.
The "Period of this Covenant" contained in this
Section 7A shall commence on the date of this Agreement and
shall terminate automatically eighteen (18) months from and
after the date this Agreement is terminated.
The "Trade Area" contained in this Section 7A shall be
deemed to encompass the world, it being expressly declared and
acknowledged by Manager that Manager will, in the course of
his responsibilities hereunder, acquire active personal
knowledge of Company's Confidential Information and
confidential business affairs throughout said Trade Area and
will acquire and possess intimate knowledge of the marketing
and distribution of Company services and products throughout
the aforesaid Trade Area.
Manager further acknowledges and agrees that the "Period
of this Covenant" is the minimum period of time, and that the
"Trade Area" hereinabove specified is the minimum and
reasonable area necessary, to protect Company reasonably and
adequately in its business operations.
B. Secrecy Covenant. Manager further covenants and
agrees that he will not, at any time either during or after
the term of this Agreement, reveal or otherwise communicate to
any person or entity any Confidential Information to which he
will or may have access, except as such communication may be
necessarily incidental to the performance of his duties with
Company under this Agreement. For purposes of this Agreement
"Confidential Information" shall mean all confidential and
proprietary information and trade secrets of Company
including, but not limited to, financial and accounting
information and procedures, product pricing data and product
formulae, identity of customers, customer requirements, sales
data, marketing information, manufacturing processes,
inventions, know-how, technology, special processes and
techniques, and distribution methods of Company or any of its
subsidiaries or affiliates, but shall not include Confidential
Information that is in the public domain or becomes part of
the public domain other than through the fault of Manager.
C. Breach of Covenants. Manager has consulted with
Manager's legal adviser concerning this Agreement, understands
the nature, term and effects of the covenants of Manager set
forth in Sections 7A and 7B above, and acknowledges and agrees
that such covenants are reasonable and necessary for the
protection of Company and its business operations. Manager
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further acknowledges and agrees that monetary damages could
not and cannot adequately compensate Company in the event of
the violation or breach of any of the covenants of Manager set
forth in Sections 7A and 7B above and that, irrespective of
any other provision of this Agreement, injunctive relief would
be essential for the protection of Company. Manager does
hereby agree, therefore, that Company may have such injunctive
relief without any requirement for a bond, upon due notice and
hearing, as will be necessary to provide full and ongoing
protection to Company with respect to the matters hereinabove
set forth, in addition to such further or other relief as may
appertain at equity or law.
D. Limitations. If and to the extent that any of the
covenants set forth in Section 7A or 7B above shall be deemed
by the court in which suit is brought to be unenforceable as
written by reason of its scope in terms of area or length of
time, but may be made enforceable by adjusting the area or
period of time applicable to such covenant, Manager and
Company stipulate and agree that such covenant shall be deemed
automatically to be amended for purposes of such suit so as to
incorporate the aforesaid reduction in area or duration of
time, or both, to the end that such covenant, as modified in
connection with such suit, shall be enforceable to the fullest
extent permissible under the laws and public policies of the
State of Missouri, the State under which this contract is
governed.
8. INDEMNITIES.
A. MANAGER'S COVENANT NOT TO XXX. Manager covenants not
to xxx for, and shall fully hold harmless and render whole
Company, its officers, directors, employees and/or agents,
from and against all claims, losses, costs, expenses
(including, but not limited to, costs of settlement and
reasonable attorneys' fees and expenses incurred in defense of
Company, its officers, directors, employees and/or agents),
demands, damages (including exemplary and punitive damages),
suits, judgments, liabilities and causes of action of
whatsoever nature or character (collectively "Claims") made or
asserted by Manager on account of personal injury or death
caused by, arising out of, or in any way incidental to, or in
connection with, the services performed by Manager for Company
including, but not limited to, those Claims where personal
injury or death (or liability therefor) was caused by the
concurrent negligence or fault of any combination of Company,
Manager and/or any third party (and/or any of their respective
officers, directors, employees and/or agents), except to the
extent that the Claim is determined to have been caused by the
sole negligence or sole willful misconduct of Company.
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B. COMPANY'S INDEMNITY OF MANAGER.
i. The Company shall indemnify Manager, should
Manager be made a party or threatened to be made a party
to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of
the Company) in connection with the services performed by
Manager for Company, against expenses (including
reasonable attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by
him in connection with such action, suit or proceeding if
Manager acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of
the Company and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action,
suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption
that Manager did not act in good faith and in a manner
which he reasonably believed to be in or not opposed to
the best interests of the Company and, with respect to
any criminal action or proceeding, had reasonable cause
to believe that his conduct was unlawful.
ii. The Company shall indemnify Manager, should
Manager be made a party or be threatened to be made a
party to any threatened, pending or completed action or
suit by or in the right of the Company to procure a
judgment in its favor by reason of the services performed
by Manager for Company, against expenses (including
attorneys' fees) actually and reasonably incurred by him
in connection with the defense or settlement of such
action or suit if he acted in good faith and in a manner
he reasonably believed to be in or not opposed to the
best interests of the Company and except that no such
indemnification shall be made in respect of any claim,
issue or matter as to which Manager shall have been
adjudged to be liable for negligence or misconduct in the
performance of this Agreement unless and only to the
extent that the Court of Chancery of Delaware or the
court in which such action or suit was brought shall
determine upon application that, despite the adjudication
of liability but in view of all the circumstances of the
case, Manager is fairly and reasonably entitled to
indemnity for such expenses which such Court of Chancery
or such other court shall deem proper.
iii. To the extent that Manager shall be successful
on the merits or otherwise in defense of any action, suit
or proceeding referred to in paragraphs (i) and (ii), or
in defense of any claim, issue or matter therein, he
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shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him
in connection therewith.
iv. Any indemnification under paragraphs (i) and
(ii) (unless ordered by a court) shall be made by the
Company only as authorized in the specific case upon a
determination that indemnification of the Manager is
proper in the circumstances because he has met the
applicable standard of conduct set forth in paragraphs
(i) and (ii). Such determination shall be made (x) by
the Board of Directors by a majority vote of a quorum
consisting of directors who were not parties to such
action, suit or proceeding, or (y) if such a quorum is
not obtainable or, even if obtainable a quorum of
disinterested directors so directs, by independent legal
counsel in a written opinion, or (z) by the
stockholders; provided, however, that Manager shall not
participate in any such determination as a Director of
the Company.
v. Expenses incurred in defending a civil or
criminal action, suit or proceeding may be paid by the
Company in advance of the final disposition of such
action, suit or proceeding as authorized by the Board of
Directors in the manner provided in paragraph (iv) upon
receipt of an undertaking by or on behalf of the Manager
to repay such amount unless it shall ultimately be
determined that he is entitled to be indemnified by the
Company as provided herein.
9. ASSIGNMENT; SUBCONTRACTING. Manager shall not assign
this Agreement or subcontract the whole or any part of the services
to be performed without the express prior written consent of
Company.
10. APPLICABLE LAW. This Agreement and all matters
pertaining hereto or arising herefrom shall be governed and
determined by the laws of the State of Missouri.
11. ENTIRE AGREEMENT. This Agreement, including Exhibit A
hereto, supersedes all prior negotiations, understandings and
agreements between the parties regarding the subject matter hereof
and constitutes the entire understanding and agreement between the
parties with respect to the subject matter hereof. No alterations,
modifications or changes to this Agreement shall be effective
unless the same are in writing and executed by both parties.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date shown above.
Company: PETROLITE CORPORATION
By: /s/ Xxxxxxx X. Xxxxxx
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(Signature)
Chairman, President and CEO
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(Title)
Manager: XXXX X. XXXXXXXX
/s/ Xxxx X. Xxxxxxxx
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(Signature)
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