EXHIBIT 10.47
AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT
This Amendment No. 1 to the Employment Agreement by and between Bway
Corporation (the "Company") and Xxxx-Xxxxxx X. Xxxxx ("Executive")
(collectively, the "Parties"), is entered into and effective as of the 1st of
January, 2002 (the "Effective Date").
WHEREAS, Executive is currently employed as Chief Executive Officer and
Chairman of the Board of Directors of the Company pursuant to an Employment
Agreement between the Company and Executive effective January 1, 2000 (the
"Employment Agreement");
WHEREAS, the Company and Executive have agreed to modify certain terms
and conditions of Executive's employment as set forth in the Employment
Agreement; and
WHEREAS, the Company and Executive desire to modify the Employment
Agreement, which modification shall be contemporaneous with the effectiveness of
this Amendment No. 1 to the Employment Agreement (the "Amendment");
NOW, THEREFORE, the Parties agree:
1. Section 3(a) of the Employment Agreement shall be amended and
restated to read as follows:
(a) During the Employment Period, Executive's base salary
shall be $500,000 per annum or such higher rate as the Board designates
from time to time (the "Base Salary"). The Base Salary shall be payable in
regular installments in accordance with the Company's general payroll
practices. The Board shall review Executive's performance in January 2002
and at the end of each twelve month period thereafter during the Employment
Period. Based on such review, the Board may, in its sole discretion,
increase or decrease the Base Salary (but not below $500,000). Following
the end of each fiscal year during the Employment Period, the Board may
award the Executive a bonus for such year based on Executive's performance,
the amount of which will be determined by the Board in its sole judgment.
Executive's "target" under the Company's Officer Incentive Plan shall be
sixty percent (60%) of Base Salary.
2. Section 4 of the Employment Agreement shall be amended and restated
to read as follows:
4. Term.
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(a) The Employment Period shall end on December 31, 2004;
provided that (i) the Employment Period shall terminate prior to such date
upon Executive's resignation, death or permanent disability or incapacity
(as determined by the Board in its good faith judgment) and (ii) the
Employment Period may be terminated by the Company at any time before or
after such date for Cause (as defined below) or without Cause.
Notwithstanding anything in this Section 4(a) to the contrary, the
Employment Period shall continue after December 31, 2004 on a year to year
basis unless either Party hereto provides the other Party with prior
written notice of its desire to terminate this Agreement. The expiration of
the Employment Period and/or the Company's decision not to renew this
Agreement at the end of any one year period following December 31, 2004
shall not constitute a termination by the Company without Cause.
(b) If the Employment Period is terminated (or deemed
terminated under Section 4(e) hereof) by the Company without Cause prior to
December 31, 2004, subject to the limitations set forth below, the Company
shall (i) pay Executive his Base Salary in accordance with the Company's
normal
payroll practices until the later of (A) December 31, 2004, or (B) the
second anniversary of the date of such termination, (ii) pay Executive, to
the extent not otherwise paid, his "target" bonuses in respect of fiscal
year 2002 and the fiscal year in which his employment is terminated (or if
his target bonuses have not yet been set for either of such fiscal years,
an amount equal to 60% of his Base Salary at the date of termination in
lieu of the "target" bonus for either such fiscal years), to be paid within
ninety (90) days after the date of termination, (iii) reimburse Executive's
COBRA premium under the Company's group health plan and dental plan (if
any) on a monthly basis for the lesser of (A) the period in which Executive
is eligible to receive such continuation coverage, or (B) eighteen (18)
months (the "COBRA Period"), and (iv) upon expiration of the COBRA Period,
procure individual medical and dental insurance policies for Executive on
substantially similar terms as the coverage provided by the Company on the
date of termination until the later of (A) December 31, 2004, or (B) the
second anniversary of the date of termination (such benefits as set forth
in the preceding sub-clauses (i) - (iv) to be referred to as the
"Separation Benefits"). In any event, the aggregate payments to Executive
as a result of the termination (or deemed termination) of the Employment
Period by the Company without Cause shall not be less than the sum of his
annual Base Salary at the rate in effect on the date of termination, his
"target" bonus for the fiscal year in question at the date of termination,
and one year's coverage under a medical and dental insurance policy. The
amounts payable pursuant to this Section 4(b) shall be reduced by the
amount of any compensation Executive receives with respect to any other
employment during the period in which the Company is making such payments
to Executive or, in the event the Employment Period is terminated as a
result of Executive's permanent disability or incapacity, by the amount
Executive receives with respect to any Company disability policy. Upon
request from time to time, Executive shall furnish the Company with a true
and complete certificate specifying any such compensation due to or
received by him. Executive has no obligation to seek employment during the
period that he is receiving compensation pursuant to this Section 4(b).
The Separation Benefits shall constitute full satisfaction of
the Company's obligations under this Agreement. The Company's obligation to
provide the Separation Benefits to Executive shall be conditioned upon (i)
Executive's execution of a Separation and Release Agreement in a form
acceptable to the Company whereby Executive releases the Company from any
and all liability and claims of any kind, and (ii) Executive's compliance
in all material respects with the provisions of Sections 5, 6, and 7
hereof. The Company's obligation to provide the Separation Benefits to
Executive shall terminate immediately upon any breach by Executive of any
post-termination obligations to which he is subject.
(c) Except as provided in Sections 11 and 12 below (to the
extent applicable), if (i) the Employment Period is terminated by the
Company for Cause, (ii) the Employment Period is terminated as a result of
Executive's death, (iii) the Employment Period expires or the Company
decides not to renew this Agreement at the end of any one year period
following December 31, 2004, or (iv) Executive resigns and such resignation
does not constitute a resignation under Section 4(e)(ii) below, then
Executive (or, in the case of Executive's death, Executive's estate) shall
be entitled to receive his Base Salary through the date of termination.
(d) Except as provided in Sections 4(b), 11 (to the extent due
and payable by the Company pursuant to the terms hereof) and 12 (to the
extent due and payable by the Company pursuant to the terms hereof), all of
Executive's rights to fringe benefits and bonuses hereunder (if any)
accruing after the termination of the Employment Period shall cease upon
such termination, except for benefits required by United States law.
(e) Notwithstanding anything in Section 4(c) to the contrary,
the Company shall be deemed to have terminated the Employment Period
without Cause in the event that (i) Executive is no longer Chief Executive
Officer or is asked to report other than directly to the Board, (ii)
Executive resigns as a result of any other material breach of this
Agreement by the Company which is not cured by the Company within 30 days
after Executive delivers written notice of such breach to the Board, (iii)
the Company terminates the Employment Period as a result of the permanent
disability or incapacity of Executive pursuant to 4(a) (i) above, or (iv)
the shareholders of the Company fail to elect (or remove) Executive as a
member of the Board during the Employment Period or the Board fails to
elect (or removes) Executive as Chairman of the Board during the Employment
Period. The Company shall not be deemed to
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have terminated the Employment Period without Cause if Executive resigns
and such resignation does not constitute a resignation under sub-clause
(ii) of the preceding sentence.
(f) "Cause" shall mean (i) a material breach of this Agreement
by Executive, (ii) the conviction of the Executive by a court of competent
jurisdiction of a felony or a crime involving moral turpitude, (iii)
conduct which, if known to the general public, would likely bring the
Company or any of its Subsidiaries into substantial public disgrace or
disrepute, (iv) substantial and repeated failure to perform duties as
reasonably directed by the Board or (v) gross negligence or willful
misconduct with respect to the Company or any of its Subsidiaries.
3. Section 11(b) of the Employment Agreement shall be amended and
restated to read as follows:
(b) Amount. The amount of the monthly supplemental retirement
benefit payable to the Executive shall be equal to 1/12th of Executive's
Base Salary of $500,000 in effect on January 1, 2002, multiplied by a
percentage multiplier determined as follows based on the age of the
Executive on the Retirement Date:
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Age of Executive on Retirement Date: Monthly Supplemental Retirement
Benefit Amount Percentage Multiplier:
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67 35%
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66 30%
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65 25%
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64 20%
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63 15%
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62 10%
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4. Section 11(c) of the Employment Agreement shall be amended and
restated to read as follows:
(c) Commencement and Duration. Payment of the Executive's
monthly supplemental retirement benefit shall commence as of the first day
of the calendar month that begins coincident with or immediately after the
date on which the Executive attains the age of 67. Monthly payments shall
continue to be made to the Executive as of the first day of each subsequent
month, with the last payment to be made for the month during which the
Executive's death occurs.
5. Section 11 of the Employment Agreement shall be amended to include
the following sub-paragraph:
(d) Acceleration. Notwithstanding anything to the contrary in
this paragraph 11, in the event that the Employment Period is terminated by
the Company without Cause or because of the Executive's permanent disability
or incapacity or by the Executive's resignation after a Change in Control,
Executive shall be entitled to the Maximum Monthly Retirement Payment (as if
he were 67 or older on such Retirement Date) provided for in paragraph 11(b)
above commencing with the month that begins immediately after the month in
which Executive's right to payments pursuant to paragraph 4(b) hereof
terminates.
6. Except as otherwise amended in this Amendment, Sections 3, 4, and 11
and all other sections of the Employment Agreement shall remain in full force
and effect as set forth in the Employment Agreement.
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as
of the day and year first above written.
BWAY CORPORATION:
By: /s/ Xxxxxxxxx X. Xxxx
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Xxxxxxxxx X. Xxxx
Chairman of Compensation Committee
Date: 12/11/01
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Xxxx-Xxxxxx X. Xxxxx:
/s/ Xxxx-Xxxxxx X. Xxxxx
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Date: 12/11/01
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