EXHIBIT 10.37
EMPLOYMENT AGREEMENT
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THIS AGREEMENT is made as of this 20th day of January, 1996, by and
among WINCUP HOLDINGS, L.P., a Delaware limited partnership (the "Employer"),
and XXXXXXX X. XXXXXXX (the "Executive").
RECITAL
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The Employer a Delaware limited partnership which manufactures and
distributes foam cups, containers and lids and plastic cups and containers.
WinCup Holdings, Inc., a Delaware corporation ("WinCup"), is the sole general
partner of Employer and Xxxxx River Paper Company, Inc., a Virginia corporation
("Xxxxx River"), is the sole limited partner of Employer.
The Executive has extensive operating and financial experience in the
manufacturing and distribution businesses and has been chief executive officer
and president of WinCup since the date of its incorporation.
The parties hereto desire to enter into this Agreement to provide for
the employment of Executive by Employer and for certain other matters in
connection with such employment, all as set forth more fully in this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein, the parties hereto, intending to be legally bound,
agree as follows:
1. Employment.
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Employer hereby employs Executive and Executive hereby accepts
employment as President, Chief Executive Officer and Chairman of the Board of
Directors ("Board") of Employer in accordance with the terms and conditions
hereinafter set forth.
2. Term.
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The term of this Agreement shall be five (5) years commencing on
the date hereof ("Initial Term"), unless earlier terminated pursuant to
Paragraph 7 below; provided, however, that unless earlier terminated pursuant to
Paragraph 7 below, the Initial Term of this Agreement shall thereafter be
renewed from year to year (each, a "Renewal Term") unless either party gives
written notice of termination to the other at least one hundred eighty (180)
days prior to the expiration of such Initial Term or Renewal Term, as the case
may be. The Initial Term and any Renewal Term(s) are hereinafter referred to,
collectively, as the "Term."
3. Duties.
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Executive is engaged hereunder as President, Chief Executive
Officer and Chairman of the Board of Employer and agrees to perform such duties
and services as are customarily incident to such offices and such other duties
and services as may be assigned to him from time to time by the Board; provided,
however, that it is expressly understood that Executive will not be required to
relocate in order to perform his duties hereunder. During his employment
hereunder, Executive shall conduct himself
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at all times so as to advance the best interests of Employer and shall not
undertake or engage in any other business activity which interferes with the
performance of his duties hereunder without the prior written consent of
Employer. It is expressly understood that nothing in this Agreement shall
preclude Executive from owning not more than five percent (5%) of the issued and
outstanding shares of a class of securities of a corporation the securities of
which are traded on a national security exchange or in the over-the-counter
market.
4. Compensation.
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For all services rendered by Executive under this Agreement,
Employer shall pay Executive a base salary of not less than Three Hundred Sixty
Thousand Dollars ($360,000) per annum, payable in equal semi-monthly
installments, together with such additional compensation, including bonus, if
any, as the Board may determine from time to time in its sole discretion (the
"Salary"). The Salary shall be reviewed on or about August 1st of each year and
may be increased in the sole discretion of the Board based on corporate policy
and Executive's performance.
5. Expenses.
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Executive is authorized to incur reasonable expenses for
promoting Employer's business, including expenses for entertainment, travel, and
similar items. Employer will reimburse Executive for all such expenses provided
such expenses have been included in an operating plan for Employer which has
been approved by the unanimous consent of the Employer's Board
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("Approved Operating Plan") and provided further Executive shall have presented
to Employer appropriate vouchers itemizing such expenses in a form consistent
with Employer's policy. Notwithstanding the foregoing, Employer shall pay
directly all expenses, including but not limited to rent, staff salaries,
utilities and other reasonable expenses, incurred in the maintenance of
Executive's main office located in Northeastern Pennsylvania, provided such
expenses have been included in an Approved Operating Plan.
6. Fringe Benefits.
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During the Term of this Agreement, Executive shall be entitled to
such benefits of employment with Employer as are now or may hereafter be in
effect for officers and employees of Employer including without limitation such
insurance, disability, medical, dental and other benefit plans or programs as
are now or hereafter established or maintained by Employer for its executive
officers. Executive shall be included in any profit-sharing, pension, retirement
or other employee benefit plan of Employer that may include as beneficiaries
executive officers of Employer, whether now in force or subsequently implemented
by Employer.
7. Termination of Employment. This Agreement may not be
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terminated during the Term, other than as provided below:
(a) Death of Executive. In the event of the death of Executive
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during the Term, this Agreement shall terminate and Employer shall have no
further obligation or liability hereunder except to pay to Executive's executor
or administrator, within
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sixty (60) days after the date of death, the portion, if any, of Executive's
Salary for the period through the date of Executive's death, unless previously
paid.
(b) Total Disability. In the event of a mental or physical
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condition which in the reasonable opinion of the Board, based upon the
independent medical diagnosis of a physician engaged by Employer for that
purpose, renders Executive unable or incompetent to perform his duties hereunder
("Total Disability"), which condition continues for a period of ninety (90)
consecutive days during the Term of this Agreement, Employer shall have the
right to terminate Executive's employment hereunder by giving Executive ten (10)
days' written notice thereof and, upon expiration of such ten-day period,
Employer shall have no further obligation or liability under this Agreement
except to pay to Executive, within sixty (60) days thereafter, the portion, if
any, of Executive's Salary for the period through the date of termination which
is due and remains unpaid.
(c) Resignation. Executive may voluntarily terminate his
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employment under this Agreement by giving Employer no less than one hundred
eighty (180) days written notice of his intention to do so including the date
upon which such termination shall become effective, which date shall not be
sooner than one hundred eighty (180) days from the date on which such notice is
given. Following the effective date of such resignation, Executive shall have no
further obligation or liability under this Agreement and Employer shall have no
further obligation or
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liability under this Agreement except to pay to Executive the same amounts which
are payable under Paragraph 7(a).
(d) Termination for Cause. The Employer may terminate this
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Agreement at any time for Cause (as hereinafter defined) upon written notice to
Executive, effective upon the date of such written notice. "Cause" shall be
defined as (a) conviction of the Executive for a felony or misdemeanor involving
dishonesty, fraud or moral turpitude under the laws of the United States or any
state thereof or other jurisdiction in which Executive performs services; (b)
breach of Section 9 hereof; or (c) removal of WinCup as General Partner of
Employer pursuant to Section 8.4 of that certain Limited Partnership Agreement,
dated as of the date hereof, between WinCup and Xxxxx River. In the event of
termination for Cause, the Employer shall have no further obligations or
liabilities to Executive hereunder, except that Executive shall be entitled to
receive any accrued but unpaid Salary and expense reimbursement, and to retain
all other amounts received by Executive pursuant to this Agreement prior to such
termination for Cause.
8. Non-Disclosure of Trade Secrets and Other Information.
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Executive agrees that he will not, during the Term of this Agreement
or at any time thereafter, use for himself or divulge to others any secret or
confidential information, knowledge, or data of Employer, developed by him or
obtained by him as a result of his employment, unless authorized by Employer in
writing. It is understood that this applies to information of
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either a technical or commercial nature, including secret processes, formulas,
machinery, utensils, manufacturing techniques and arts, customer lists, market
information and the like. The terms 'secret' and 'confidential' shall include
all unpublished information and all information and data known to some but not
to all members of the trade or industry to whom such information or data would
be in any manner useful.
All memoranda, notes, records, or other documents made or compiled by
Executive, or made available to Executive while employed by Employer, are
Employer's property and all copies thereof shall be delivered to Employer on
termination of Executive's employment or at any other time upon the request of
Employer.
9. Restrictive Covenant.
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(a) Non-Competition.
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Executive agrees that, so long as he is employed by Employer
pursuant to this Agreement and for a period of five (5) years thereafter, he
will not, directly or indirectly, as a sole proprietor, member of a partnership,
stockholder, investor, officer or director of a corporation, or as an employee,
agent, associate or consultant of any person, partnership or corporation other
than Employer or in any other capacity:
(i) own, manage, operate, participate in, perform
services for or otherwise carry on a business which sells or manufactures one-
piece foam cups within the United States or
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Canada (the "Territory"); provided that ownership of not more than five percent
(5%) of the issued and outstanding shares of a class of securities of a
corporation the securities of which are traded on a national security exchange
or in the over-the-counter market shall not be deemed ownership of the issuer of
such shares for the purposes of this section;
(ii) induce or attempt to persuade any employee of
Employer or any of its affiliates to terminate such employment relationship in
order to enter into any such relationship with such person or to enter into any
such relationship on behalf of any other business organization which sells or
manufactures one-piece foam cups in the Territory;
(iii) solicit any business related to the manufacture or
sale of one-piece foam cups in the Territory from any clients, customers, or
prospective or former clients or customers of Employer or its affiliates; or
(iv) perform services of any nature for any entity
which manufactures or sells one-piece foam cups in the Territory.
(b) Injunctive Relief. Without limiting the right of Employer or
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any of its successors or permitted assigns to pursue all other legal and
equitable rights available to them for violation of the covenants set forth in
subparagraph 9(a) hereof, it is agreed that such other remedies cannot fully
compensate Employer and its successors and assigns for such a violation and
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that Employer and its successors and assigns shall be entitled to injunctive
relief to prevent violation or continuing violation hereof. It is the intent
and understanding of each party hereto that if, in any action before any court
or agency legally empowered to enforce this covenant, any term, restriction,
covenant or promise is found to be unreasonable and for that reason
unenforceable, then such term, restriction, covenant or promise shall be deemed
modified to the extent necessary to make it enforceable by such a court or
agency.
10. Arbitration.
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Except as provided in subparagraph 9(b) hereof, any controversy
or claim arising out of or relating to this Agreement or the breach thereof
shall be settled by arbitration in Wilmington, Delaware, in accordance with the
rules of the American Arbitration Association and any decision made in
accordance with such rules shall be binding on all parties in interest, and
judgment upon any award rendered may be entered in any court having jurisdiction
thereof.
11. Waiver of Breach.
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The waiver by Employer or Executive, as the case may be, of a
breach of any provision of this Agreement by Executive or Employer, as the case
may be, will not operate or be construed as a waiver of any subsequent breach by
Executive or Employer, as the case may be.
12. Entire Agreement.
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This instrument contains the entire Agreement of
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the parties with respect to the employment of Executive by Employer. It may not
be changed orally, but only by an agreement in writing signed by the party
against whom enforcement of any waiver, change, modification, extension or
discharge is sought.
13. Severability.
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If any provision of this Agreement shall be invalid or
unenforceable, in whole or in part, such provision shall be deemed to be
modified or restricted to the extent and in the manner necessary to render the
same valid and enforceable, or shall be deemed excised from this Agreement, as
the case may require, and this Agreement shall be construed and enforced to the
maximum extent permitted by law, as if such provision had been originally
incorporated herein as so modified or restricted, or as if such provision had
not been originally incorporated herein, as the case may be.
14. Notices.
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All notices required or permitted to be given hereunder shall be
in writing and shall be deemed to have been given when actually received. If
such notice is mailed, it shall be deposited, registered or certified, return
receipt requested, in the United States mail, or by commercial overnight courier
such as Federal Express, addressed to the intended recipient as follows:
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If to the Executive:
Xx. Xxxxxxx X. Xxxxxxx
000 Xxxxxx Xxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxxx 00000
If to the Employer:
WinCup Holdings, L.P.
c/o WinCup Holdings, Inc.
000 Xxxxxxxxxxxx Xxxxxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: Xx. Xxxxxxx X. Xxxxxxx, President
Any party hereto may from time to time change its address for the purpose of
notice to that party by a similar notice specifying a new address, but no such
change shall be deemed to have been given until it is actually received by the
parties sought to be charged with its contents.
15. Bind and Inure.
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This Agreement shall be binding upon and inure to the benefit of
the parties and their respective successors in interest.
16. Governing Law.
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This Agreement is made in and shall be construed in
accordance with and governed by the laws of the State of Delaware.
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IN WITNESS WHEREOF, the parties have executed or caused to be executed this
Agreement on the day and year first above written.
EMPLOYER:
WINCUP HOLDINGS, L.P.
By: WINCUP HOLDINGS, INC., its
general partner
By: /s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
President
EXECUTIVE
/s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
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