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EXHIBIT 10.21
COCA-COLA ENTERPRISES INC.
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") effective April 17, 1998,
between Coca-Cola Enterprises Inc. (the "Company") and Xxxxx X. Xxxxxxxxx ("Xx.
Xxxxxxxxx").
WHEREAS, Xx. Xxxxxxxxx is presently employed by the Company as the
President and Chief Operating Officer; and
WHEREAS, the Company desires to ensure Xx. Xxxxxxxxx'x continued
employment and to have Xx. Xxxxxxxxx serve in the position of President and
Chief Executive Officer for a period of two years from the effective date of
this Agreement, and thereafter to have Xx. Xxxxxxxxx to serve as a consultant
to the Company and The Coca-Cola Company and their related companies; and
WHEREAS, Xx. Xxxxxxxxx desires to serve in these capacities.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, the parties do hereby agree as
follows:
1. Term of Employment. Xx. Xxxxxxxxx'x "Employment Period," as
this term is used throughout the Agreement, shall begin April 17, 1998 and
shall continue for a period of two years, subject to earlier termination as
expressly provided in Section 8 hereof.
2. Position and Title During Employment Period. During the
Employment Period, Xx. Xxxxxxxxx shall serve in the capacity as President and
Chief Executive Officer of the Company.
3. Compensation During Employment Period. The Company shall pay
to Xx. Xxxxxxxxx base salary compensation at the rate of $1,150,000 per year
until January 1, 1999, and thereafter as determined by the Compensation
Committee of the Company's Board of Directors.
4. Incentive Plan Bonuses. During the Employment Period, Xx.
Xxxxxxxxx shall be eligible to participate in the Executive Management
Incentive Plan and the Long-Term Incentive Plan (each referred to herein as an
"Incentive Plan") for any Performance Period (as that term is defined in each
such plan) for which an Incentive Plan is adopted. In the event the Employment
Period ends prior to the end of a Performance Period, Xx. Xxxxxxxxx'x award
under the relevant Incentive Plan shall be prorated and paid in accordance with
the terms of such plan.
5. Employee and Fringe Benefits. During the Employment Period,
Xx. Xxxxxxxxx shall be eligible to participate in all employee and fringe
benefit plans for which he is otherwise eligible as an employee of the Company,
which participation shall be governed by the terms of the relevant plans.
6. Special Stock Option Grant. The Company shall, on the
effective date of this Agreement, grant Xx. Xxxxxxxxx 600,000 stock options in
a special multi-year grant, which grant is intended to represent all stock
grants for which Xx. Xxxxxxxxx will be eligible during the Employment Period.
The terms of the stock option grant made pursuant to this Section 6 are set
forth in the Stock Option
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Agreement, attached hereto as Appendix A.
7. Consulting Services Upon Termination of Employment. Upon the
termination or expiration of the Employment Period, Xx. Xxxxxxxxx shall enter
into a consulting agreement with the Company and/or The Coca-Cola Company,
which agreement shall provide, under terms mutually agreed upon by the parties,
for the following:
(a) Xx. Xxxxxxxxx to, for the period after his
termination of employment through April 2003, provide such time and
services as Company and The Coca-Cola Company may reasonably request,
with the time and effort devoted to consulting services ("Consulting
Services") to be consistent with Xx. Xxxxxxxxx'x non-full time status
and availability in view of his involvement in other non-Coca-Cola
business and activities. Specifically, Xx. Xxxxxxxxx'x Consulting
Services will include:
(i) Continuing service on the Company's Board of
Directors (subject to election by the Company's share owners)
and service on the Board of Directors of other Coca-Cola
bottling companies, as determined from time-to-time by the
Company or The Coca-Cola Company;
(ii) Consulting with the Company and The Coca-Cola
Company on special projects, such as projects related, but
not limited, to marketing and product distribution, as shall
be mutually determined by the parties from time to time; and
(iii) "Trouble-shooting" within the Coca-Cola system on
project-by-project basis, as shall be mutually determined by
the parties from time to time;
(b) Xx. Xxxxxxxxx to have the title of Consultant to the
Company and The Coca-Cola Company, reporting to the Chief Executive
Officer of The Coca-Cola Company.
(c) Xx. Xxxxxxxxx to receive consulting fees of $400,000
per year paid by the Company and/or The Coca-Cola Company (to be
shared between them based upon an allocation of Xx. Xxxxxxxxx'x duties
and responsibilities as determined on or before April 1, 2000) which
payments will be in addition to any fees Xx. Xxxxxxxxx earns for
service on the Company's Board of Directors or on the boards of
directors of other Coca-Cola bottling companies.
(d) For the period during which Xx. Xxxxxxxxx is
providing Consulting Services, Xx. Xxxxxxxxx and his eligible
dependents to be eligible to participate in the Company's Executive
Retiree Medical Plan, which plan shall provide the same medical
benefits (and on the same basis) as provided under the medical plan
covering active nonunion employees of the Company, as it may be
amended from time to time; and Xx. Xxxxxxxxx to be eligible to
participate in the Company's financial planning and tax benefit plans
on the same basis as other eligible employees.
(e) Xx. Xxxxxxxxx to act as an independent contractor in
the performance of Consulting Services, responsible for payment of all
taxes including federal, state and local taxes arising out of such
services.
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(f) The Company or The Coca-Cola Company to provide Xx.
Xxxxxxxxx with an office and secretary in its corporate offices in
order to assist him in the performance of his Consulting Services.
(g) The Company and/or The Coca-Cola Company to
reimburse Xx. Xxxxxxxxx for all expenses incurred in connection with
the performance of Consulting Services.
8. Termination of Agreement. This Agreement shall terminate
upon Xx. Xxxxxxxxx'x death, disability or the existence of circumstances
constituting a termination for "cause," as hereinafter defined. In the event of
such termination, the Company shall pay to Xx. Xxxxxxxxx or his estate all
amounts owed and payable to him under this Agreement as of the date of such
termination. For purposes of this Section 8, "cause" shall mean Xx. Xxxxxxxxx'x
willful failure or inability to carry out his duties and responsibilities in
any material respect, the commission of a felony or commission of any willful
and intentional, unprofessional or unethical act which has or would have, if
such act becomes public knowledge, a substantial and adverse effect on the
business operations or reputation of the Company.
9. Non-Competition; Confidentiality. For a period of two years
from the date of termination or expiration of the Employment Period or
termination or expiration of the consulting agreement described in Section 7
(whichever is the latter to occur), Xx. Xxxxxxxxx shall not, directly or
indirectly engage in, participate in or have any interest as a consultant,
partner, joint venture, proprietor, employee, officer, director, agent,
security holder, creditor or consultant, or in any other capacity, or have any
other direct or indirect financial interest in any business, firm, person,
partnership, corporation (other than the Company or The Coca-Cola Company)
engaged in any activity similar to or competitive with any activity now engaged
in by the Company or The Coca-Cola Company, including, but not limited to,
manufacturing, producing or distributing liquid, nonalcoholic beverages in any
geographic area in which the Company or The Coca-Cola Company or any licensee
of The Coca-Cola Company has operations during or at the conclusion of the
Employment Period or period during which Consulting Services are provided
pursuant to Section 7 (whichever is the latter to occur); except nothing herein
shall be deemed to prevent or limit the right of Xx. Xxxxxxxxx to own capital
stock or other securities of any corporation, the securities of which are
publicly owned or regularly traded in the over-the-counter market or on any
securities exchange, provided that Xx. Xxxxxxxxx does not acquire beneficial
ownership (as determined under Rule 13d-3 of the Securities Exchange Act of
1934) of more than one percent of the issuer's outstanding securities of that
class.
10. Enforcement.
(a) The parties recognize that the nature of the subject
matter of this Agreement, including Section 9, would make it
impracticable and extremely difficult to determine actual damages to
the Company in the event of a breach of this Agreement by Xx.
Xxxxxxxxx. Accordingly, if Xx. Xxxxxxxxx commits a breach or threatens
to commit a breach of any of the provisions of this Agreement, the
Company shall have the right and remedy to have the provisions of the
Agreement specifically enforced by any court having equity
jurisdiction, it being acknowledged and agreed that any such breach or
threatened
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breach will cause irreparable injury to the Company and that money
damages will not provide an adequate remedy to the Company. The rights
of the Company to equitable relief in the enforcement of this
Agreement shall be in addition to any and all other remedies available
through an action in law.
(b) If any of the covenants contained in Section 9, or
any part thereof, are held to be unenforceable because of the duration
of such provisions or the area covered thereby, the undersigned agree
that the court making such determination shall have the power to
reduce the duration and the area or both of any such provision and, in
its reduced form, said provision shall then be enforceable.
(c) Should any other portion of this Agreement be
declared invalid for any reason or to have ceased to have been binding
on the parties hereto, said provision shall be severed and all other
provisions shall continue to be effective and binding.
(d) Notwithstanding anything herein to the contrary, the
Company shall not be relieved of any of its obligations hereunder to
Xx. Xxxxxxxxx in the event of determination by any court, arbitrator,
or other governing authority that the covenants contained in Section 9
are unenforceable or to limit the enforceability of any such
covenants.
11. Binding Effect and Assignment. This Agreement benefits and
binds the Company and Xx. Xxxxxxxxx and their respective heirs, executors,
administrators, personal representatives, successors and assigns.
Notwithstanding the foregoing, and except as contemplated by Section 7, the
parties shall not be entitled to assign this Agreement or rights hereunder
without the prior written consent of the other party; provided however, that at
any time following commencement of the Consulting Services under Section 7, Xx.
Xxxxxxxxx may assign his rights under this Agreement to a corporation,
partnership or limited liability company controlled by Xx. Xxxxxxxxx, subject
to the condition that all services and other duties and responsibilities shall
be performed solely by Xx. Xxxxxxxxx.
12. Headings; Definitions. The headings of sections contained in
this Agreement are inserted only as a matter of convenience and for reference
and in no way define, limit, extend or describe the scope of this Agreement or
the intent of any provision hereof. The parties agree to all definitions in the
statement of parties to this Agreement and in the other introductory language
to this Agreement.
13. Controlling Law; Amendment; Waiver. This Agreement shall be
governed by the laws of the State of Georgia. This Agreement may not be altered
or amended except in writing signed by the parties. The failure of any party
hereto at any time to require performance of any provisions hereof shall in no
manner affect the right to subsequently enforce the same. No waiver by any
party hereto of any condition, or of the breach of any term, provisions,
warranty, representation, agreement or covenant contained in this Agreement,
whether by conduct or otherwise, in any one or more instances shall be deemed
or construed as a further or continuing waiver of any such condition or breach
or a waiver of any other condition or of the breach of any other term,
provision, warranty, representation, agreement or covenant herein contained.
14. Entire Agreement. This Agreement constitutes the entire
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understanding and agreement between the Company and Xx. Xxxxxxxxx with respect
to the subject matter hereof and supersedes all prior negotiations,
understandings and agreements, whether written or oral, between the Company and
Xx. Xxxxxxxxx with respect to the subject matter hereof.
XXXXX X. XXXXXXXXX COCA-COLA ENTERPRISES INC.
/s/ XXXXX X. XXXXXXXXX
By: /s/ XXXX X. XXXXXXXXX
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Title: Chairman Compensation Committee
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April 27, 1998
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Date Date
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APPENDIX A
Coca-Cola Enterprises Inc.
Stock Option Grant Agreement
Pursuant to the terms of the Employment Agreement, effective April 17,
1998, between Coca-Cola Enterprises Inc. (the "Company") and Xxxxx X. Xxxxxxxxx
("Optionee") and the 1997 Coca-Cola Enterprises Inc. Stock Option Plan, the
Company hereby grants to Optionee 600,000 stock options, subject to the terms
and conditions set forth below (herein referred to as the "April 1998 Option
Grant").
1. The April 1998 Option Grant will be divided into five
separate grants, each with an exercise price that reflects a performance goal
of an approximate 15% annual growth in the fair market value of the Company's
stock, measured from April 17, 1998, the date of grant. The fair market value
of the Company's stock (determined as the average of the high and low trading
prices) on April 17, 1998 was $39.8438.
2. The April 1998 Option Grant entitles you to purchase:
120,000 shares at $45.8204 ("Grant 1")
120,000 shares at $52.6935 ("Grant 2")
120,000 shares at $60.5975 ("Grant 3")
120,000 shares at $69.6871 ("Grant 4")
120,000 shares at $80.1402 ("Grant 5")
3. As long as you are performing the services required by the referenced
Employment Agreement and the consulting agreement contemplated in Section 7
therein, the options of the April 1998 Option Xxxxx xxxx (become exercisable)
in accordance with the following schedule:
Vesting Date Total Options Each of Grant 1-5's
Vesting Vesting
------------- -------------- --------------------
April 1, 2000 300,000 60,000
April 1, 2001 100,000 20,000
April 1, 2002 100,000 20,000
April 1, 2003 100,000 20,000
Example: Assuming the continued service requirement has been satisfied as of
April 1, 2000, the following portions of the April 1998 Option Grant will be
exercisable: 60,000 of Grant 1, 60,000 of Grant 2, 60,000 of Grant 3, 60,000 of
Grant 4, and 60,000 of Grant 5, for a total of 300,000 vested options. Assuming
the continued service requirement is satisfied as of April 1, 2001, an
additional 20,000 options from each of Grants 1 though 5 will vest, a total of
100,000 additional options.
4. If, for any reason, Optionee does not continue to provide
employment and/or consulting services though April 1, 2003, any options which
have not vested as of the date on which such services cease shall be forfeited.
However, any options which are vested as of the date Optionee ceases to provide
such services will remain exercisable until they expire, as described below.
5. The options granted in the April 1998 Option Grant expire at
the close of business April 1, 2008.
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SECURITIES LAW RESTRICTIONS
Because of certain restrictions under the federal securities laws, under no
circumstances should options held by an executive officer of the Company be
exercised without consultation with the General Counsel's office concerning any
restrictions which apply.
THE ABOVE AGREEMENT IS A SUMMARY OF A GRANT MADE UNDER THE COMPANY'S
1997 STOCK OPTION PLAN (THE PLAN), THE TERMS OF WHICH ARE
INCORPORATED BY REFERENCE INTO THIS DOCUMENT. IN THE EVENT OF A
CONFLICT BETWEEN THE PLAN AND THIS AGREEMENT, THE TERMS OF THE PLAN
CONTROL. PLEASE NOTE THAT THE COMPANY'S BOARD OF DIRECTORS OR
COMPENSATION COMMITTEE MAY INTERPRET THE PLAN, TERMINATE THE PLAN, OR
AMEND ITS PROVISIONS, WITHOUT THE APPROVAL OF SHARE OWNERS, UNLESS
SUCH ACTION WOULD ADVERSELY AFFECT OPTIONS PREVIOUSLY GRANTED, OR
RAISE LEGAL CONCERNS UNDER SECURITIES OR TAX LAWS. YOUR SIGNATURE OF
ACCEPTANCE OF THE AWARDS OF STOCK OPTIONS ALSO CONSTITUTES YOUR
ACCEPTANCE OF THE TERMS AND CONDITIONS OF THE PLAN.
COCA-COLA ENTERPRISES IS THE PLAN ADMINISTRATOR
WHOSE FUNCTION IS TO ENSURE THE PLAN IS MANAGED
ACCORDING TO ITS RESPECTIVE TERMS AND CONDITIONS.
QUESTIONS PERTAINING TO THE PLAN SHOULD BE
DIRECTED TO:
COCA-COLA ENTERPRISES INC.
CORPORATE COMPENSATION
X.X. XXX 000000
XXXXXXX, XX 00000-0000
(000) 000-0000
Please acknowledge below your acceptance of the terms of your April 1998 Option
Grant.
Accepted:
/S/ XXXXX X. XXXXXXXXX
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Signature
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Date
