Exhibit 10.3
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), made as of this 1st day of
September, 2006, is entered into by Nashua Corporation, a Massachusetts
corporation with its principal place of business at 00 Xxxxxxxxx Xxxxxx, Xxxxx
000, Xxxxxx, Xxx Xxxxxxxxx 00000 (the "Company"), and Xxxx XxXxxxx, residing at
0000 Xxxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxx 00000 (the "Executive").
The Company desires to employ the Executive, and the Executive desires to
be employed by the Company. In consideration of the mutual covenants and
promises contained in this Agreement, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged by the parties to
this Agreement, the parties agree as follows:
1. Employment At-Will. The Company hereby agrees to employ the Executive,
and the Executive hereby accepts employment with the Company, upon the terms set
forth in this Agreement, commencing on September 1, 2006 (the "Commencement
Date"). Subject to the provisions set forth herein and in the change of control
and severance agreement, of even date herewith, attached hereto as Exhibit A
(the "Change of Control Agreement"), the Executive's employment with the Company
shall be at-will meaning that either party may terminate the employment
relationship at any time, for any reason, with or without cause or notice
subject to the provisions set forth herein.
2. Title; Capacity. The Executive shall serve on a full-time basis as Vice
President of Sales and Marketing. The Executive shall be based in the Company's
office in Park Ridge, Illinois. The Executive shall be subject to the
supervision of, and shall have such authority as is delegated to the Executive
by, the President and Chief Executive Officer (CEO).
The Executive hereby accepts such employment and agrees to undertake the
duties and responsibilities inherent in such position and such other duties and
responsibilities as the CEO shall from time to time reasonably assign to the
Executive. The Executive agrees to devote his entire business time, attention
and energies to the business and interests of the Company and shall not engage
in any other business activities without the prior (written) approval of the
CEO. The Executive agrees to abide by the rules, regulations, instructions,
personnel practices and policies of the Company and any changes therein which
may be adopted from time to time by the Company.
3. Compensation and Benefits.
3.1 Salary. The Company shall pay the Executive, in periodic
installments in accordance with the Company's customary payroll practices, an
annualized base salary of $250,000, for the period commencing on the
Commencement Date.
3.2 Annual Bonus. Beginning January 1, 2007, the Executive shall be
eligible to receive an annual cash bonus, payable as a percentage (60%) of the
Executive's base salary, based upon the achievement of certain plan goals
established by the CEO.
3.3 Fringe Benefits. The Executive shall be entitled to participate in
all bonus and benefit programs that the Company establishes and makes available
to its employees, if any, to the extent that Executive's position, tenure,
salary, age, health and other qualifications make him eligible to participate.
The Executive shall be entitled to four weeks paid vacation per year, to be
taken at such times as may be approved by the CEO. Vacation time may not be
carried over from year to year.
3.4 Reimbursement of Expenses. The Company shall reimburse the
Executive for all reasonable travel, entertainment and other expenses incurred
or paid by the Executive in connection with, or related to, the performance of
his duties, responsibilities or services under this Agreement, in accordance
with policies and procedures, and subject to limitations, adopted by the Company
from time to time.
3.5 Withholding. All salary, bonus and other compensation payable to
the Executive shall be subject to applicable withholding taxes.
3.6 Restricted Stock. Subject to approval of the Board and the
Executive's execution of the applicable Company restricted stock agreements, the
Executive shall be granted 15,000 shares of common stock, par value $1.00 per
share, of the Company (the "Common Stock"), subject to the terms and conditions
of the Company's 2004 Value Creation Incentive Plan, or if granted pursuant to a
different stock incentive plan of the Company, such grant of Common Stock shall
be on substantially similar terms and conditions as the Company's 2004 Value
Creation Incentive Plan. The common stock shall vest as to (i) 33% if the
average of the last reported sales price per share of the Common Stock on the
Nasdaq National Market (or other national securities exchange or nationally
recognized trading system) for a 40 consecutive trading day period ending on the
third anniversary of the Commencement Date (the "40-Day Average Closing Price")
is equal to or greater than $13.00 and less than $14.00, (ii) 66% if the 40-Day
Average Closing Price is equal to or greater than $14.00 and less than $15.00
and (iii) 100% if the 40-Day Average Closing Price is equal to or greater than
$15.00. The common stock shall vest upon the terms and conditions set forth in
the 2004 Value Creation Incentive Plan.
3.7 Change of Control Agreement. The Executive shall, upon execution
of this Agreement, execute the Change of Control Agreement.
4. Confidentiality, Non-Competition, Return of Property and Development
Agreement. The Executive shall, upon execution of this Agreement, execute a
non-competition and non-solicitation agreement in the form attached hereto as
Exhibit B.
5. Other Agreements. The Executive represents that his performance of all
the terms of this Agreement and the performance of his duties as an employee of
the Company do not and will not breach any agreement with any prior employer or
other party to which the Executive is a party (including without limitation any
nondisclosure or non-competition agreement). Any agreement to which the
Executive is a party relating to nondisclosure, non-competition or
non-solicitation of employees or customers is listed on Schedule A attached
hereto.
-2-
6. Miscellaneous.
6.1 Notices. Any notices delivered under this Agreement shall be
deemed duly delivered four business days after it is sent by registered or
certified mail, return receipt requested, postage prepaid, or one business day
after it is sent for next-business day delivery via a reputable nationwide
overnight courier service, in each case to the address of the recipient set
forth in the introductory paragraph hereto. Either party may change the address
to which notices are to be delivered by giving notice of such change to the
other party in the manner set forth in this Section 8.1.
6.2 Pronouns. Whenever the context may require, any pronouns used in
this Agreement shall include the corresponding masculine, feminine or neuter
forms, and the singular forms of nouns and pronouns shall include the plural,
and vice versa.
6.3 Entire Agreement. This Agreement constitutes the entire agreement
between the parties and supersedes all prior agreements and understandings,
whether written or oral, relating to the subject matter of this Agreement.
6.4 Amendment. This Agreement may be amended or modified only by a
written instrument executed by both the Company and the Executive.
6.5 Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the Commonwealth of Massachusetts (without
reference to the conflicts of laws provisions thereof). Any action, suit or
other legal proceeding arising under or relating to any provision of this
Agreement shall be commenced only in a court of the Commonwealth of
Massachusetts (or, if appropriate, a federal court located within Massachusetts
or the Northern District of Illinois), and the Company and the Executive each
consents to the jurisdiction of such a court.
6.6 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of both parties and their respective successors and
assigns, including any corporation with which, or into which, the Company may be
merged or which may succeed to the Company's assets or business, provided,
however, that the obligations of the Executive are personal and shall not be
assigned by him.
6.7 Waivers. No delay or omission by the Company or the Executive in
exercising any right under this Agreement shall operate as a waiver of that or
any other right. A waiver or consent given by the Company or the Executive on
any one occasion shall be effective only in that instance and shall not be
construed as a bar or waiver of any right on any other occasion.
6.8 Captions. The captions of the sections of this Agreement are for
convenience of reference only and in no way define, limit or affect the scope or
substance of any section of this Agreement.
6.9 Severability. In case any provision of this Agreement shall be
invalid, illegal or otherwise unenforceable, the validity, legality and
enforceability of the remaining provisions shall in no way be affected or
impaired thereby.
-3-
THE EXECUTIVE ACKNOWLEDGES THAT HE HAS CAREFULLY READ THIS AGREEMENT AND
UNDERSTANDS AND AGREES TO ALL OF THE PROVISIONS IN THIS AGREEMENT.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year set forth above.
NASHUA CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: President and CEO
EXECUTIVE
/s/ Xxxx XxXxxxx
----------------------------------------
Xxxx XxXxxxx
-4-
SCHEDULE A
Prior Agreements
