EMPLOYMENT AGREEMENT
EXHIBIT 10.1
May 6, 2024
| NAME: | Xxx Xxxxx | ||||
The parties to this Employment Agreement (“Agreement”) are Xxx Xxxxx (“You” or the “Executive”) and Quaker Chemical Corporation, d/b/a Quaker Houghton, a Pennsylvania corporation (“Quaker Houghton” or the “Company”).
You are hereby appointed as the Company’s EVP and Chief Financial Officer (“CFO”) effective June 10, 2024.
NOW THEREFORE in consideration of the mutual promises and covenants herein contained and intending to be legally bound hereby the parties hereto agree as follows:
1. Duties
Xxxxxx Xxxxxxxx agrees to employ you and you agree to serve as Xxxxxx Xxxxxxxx’x CFO. You shall perform all duties consistent with such position as well as any other duties that are assigned to you from time to time by Xxxxxx Xxxxxxxx’x CEO. You agree that during the term of your employment with Xxxxxx Xxxxxxxx to devote your knowledge, skill, and working time solely and exclusively to the business and interests of Quaker Houghton and its subsidiaries.
2. Compensation
Your base salary will be determined from time to time by the Quaker Houghton Board of Directors. In addition, you will be entitled to participate, to the extent eligible, in any of Quaker Houghton’s annual and long-term incentive plans, retirement savings plan (401k plan), and will be entitled to vacations, paid holidays, and medical, dental, and other benefits as are made available by Quaker Houghton to its executives and full-time U.S. employees. During your employment with Xxxxxx Xxxxxxxx, your salary will not be reduced by Xxxxxx Xxxxxxxx without your prior written consent. Your initial compensation and benefits are outlined on Addendum 1, which is attached hereto and made a part hereof.
3. Term of Employment.
Your employment with Quaker may be terminated on ninety (90) days' written notice by either party, with or without cause or reason whatsoever. Within ninety (90) days after termination of your employment, you will be given an accounting of all monies due you. Notwithstanding the foregoing,
Quaker has the right to terminate your employment upon less than ninety (90) days’ notice for Cause (as defined below).
4. Covenant Not to Disclose
a. As CFO, you acknowledge that the identity of Quaker Houghton's (and any of Quaker Houghton's affiliates’) customers, the requirements of such customers, pricing and payment terms quoted and charged to such customers, the identity of Quaker Houghton's suppliers and terms of supply (and the suppliers and related terms of supply of any of Quaker Houghton's customers for which chemical and other management services are being provided), information concerning the method and conduct of Quaker Houghton's (and any affiliate’s) business such as formulae, formulation information, application technology, manufacturing information, marketing information, strategic and marketing plans, financial information, financial statements (audited and unaudited), budgets, corporate practices and procedures, research and development efforts, and laboratory test methods and all of Quaker Houghton's (and its affiliates’) manuals, documents, notes, letters, records, and computer programs are Quaker Houghton's confidential information ("Confidential Information") and are Quaker Houghton’s (and/or any of its affiliates’, as the case may be) sole and exclusive property. You agree that at no time during or following your employment with Quaker Xxxxxxxx will you appropriate for your own use, divulge, or pass on, directly or through any other individual or entity or to any third party, any Quaker Houghton Confidential Information. Upon termination of your employment with Xxxxxx Xxxxxxxx and prior to final payment of all monies due to you under Section 2 or at any other time upon Xxxxxx Xxxxxxxx'x request, you agree to surrender immediately to Quaker Houghton all materials in your possession or control which include or contain any Quaker Houghton Confidential Information.
b. You acknowledge that, by this Section 4(b), you have been notified in accordance with the Defend Trade Secrets Act that, notwithstanding the foregoing:
(i)You will not be held criminally or civilly liable under any federal or state trade secret law or this Agreement for the disclosure of Confidential Information that: (A) you make (1) in confidence to a federal, state, or local government official, either directly or indirectly, or to your attorney; and (2) solely for the purpose of reporting or investigating a suspected violation of law; or (B) you make in a complaint or other document that is filed under seal in a lawsuit or other proceeding.
(ii)If you file a lawsuit for retaliation by Xxxxxx Xxxxxxxx for reporting a suspected violation of law, you may disclose Confidential Information to your attorney and use the Confidential Information in the court proceeding if you: (A) file any document containing Confidential Information under seal and (B) do not disclose Confidential Information, except pursuant to court order.
c. Additionally, Xxxxxx Xxxxxxxx confirms that nothing in this Agreement is intended to or shall prevent, impede or interfere with your right, without prior notice to Quaker Houghton, to provide information to the government, participate in any government investigations, file a court or administrative complaint, testify in proceedings regarding Xxxxxx Xxxxxxxx’x past or future conduct, or engage in any future activities protected under any statute administered by any government agency.
5. Covenant Not to Compete
In consideration of your position of CFO for Quaker Houghton and the training and Confidential Information you are to receive from Quaker Houghton, you agree that during your employment with Quaker Houghton and for a period of one (1) year thereafter, regardless of the reason for your termination, you will not:
a. directly or indirectly, together or separately or with any third party, whether as an employee, individual proprietor, partner, stockholder, officer, director, or investor, or in a joint venture or any other capacity whatsoever, actively engage in business or assist anyone or any firm in business as a manufacturer, seller, or distributor of specialty chemical products which are the same, like, similar to, or which compete with Quaker Houghton’s (or any of its affiliates’) products or services; and
b. directly or indirectly recruit, solicit, or encourage any Quaker Houghton (or any of its affiliates’) employee or otherwise induce such employee to leave Quaker Houghton’s (or any of its affiliates’) employ, or to become an employee or otherwise be associated with you or any firm, corporation, business, or other entity with which you are or may become associated; and
c. solicit or induce any of Quaker Houghton's suppliers of products and/or services (or a supplier of products and/or services of a customer who is being provided or solicited for the provision of chemical management or other services by Quaker Houghton) to terminate or alter its contractual relationship with Xxxxxx Xxxxxxxx (and/or any such customer).
The parties consider these restrictions reasonable, including the period of time during which the restrictions are effective. However, if any restriction or the period of time specified should be found to be unreasonable in any court proceeding, then such restriction shall be modified or the period of time shall be shortened as is found to be reasonable so that the foregoing covenant not to compete may be enforced. You agree that in the event of a breach or threatened breach by you of the provisions of the restrictive covenants contained in Section 4 or in this Section 5, Quaker Houghton will suffer irreparable harm, and monetary damages may not be an adequate remedy. Therefore, if any breach occurs, or is threatened, in addition to all other remedies available to Quaker Houghton, at law or in equity, Quaker Houghton shall be entitled as a matter of right to specific performance of the covenants contained herein by way of temporary or permanent injunctive relief. In the event of any breach of the restrictive covenant contained in this Section 5, the term of the restrictive covenant shall be extended by a period of time equal to that period beginning on the date such violation commenced and ending when the activities constituting such violation cease.
6. Contractual Restrictions
You represent and warrant to Quaker Houghton that: (a) there are no restrictions, agreements, or understandings to which you are a party that would prevent or make unlawful your employment with Quaker Houghton and (b) your employment by Quaker Houghton shall not constitute a breach of any contract, agreement, or understanding, oral or written, to which you are a party or by which you are bound. You further represent that you will not use any trade secret, proprietary or otherwise confidential information belonging to a prior employer or other third party in connection with your employment with Xxxxxx Xxxxxxxx.
7. Inventions
All improvements, modifications, formulations, processes, discoveries or inventions ("Inventions"), whether or not patentable, which were originated, conceived or developed by you solely or jointly with others (a) during your working hours or at Quaker Houghton’s expense or at Quaker Houghton's premises or at a customer’s premises or (b) during your employment with Quaker Houghton and additionally for a period of one year thereafter, and which relate to (i) Quaker Houghton’s business or (ii) any research, products, processes, devices, or machines under actual or anticipated development or investigation by Xxxxxx Xxxxxxxx at the earlier of (i) that time or (ii) as the date of termination of employment, shall be Quaker Houghton’s sole property. You shall promptly disclose to Quaker Houghton all Inventions that you conceive or become aware of at any time during your employment with Quaker Houghton and shall keep complete, accurate, and authentic notes, data, and records of all Inventions and of all work done by you solely or jointly with others, in the manner directed by Xxxxxx Xxxxxxxx. You hereby transfer and assign to Quaker Houghton all of your right, title, and interest in and to any and all Inventions which may be conceived or developed by you solely or jointly with others during your employment with Xxxxxx Xxxxxxxx. You shall assist Xxxxxx Xxxxxxxx in applying, obtaining, and enforcing any United States Letters Patent and Foreign Letters Patent on any such Inventions and to take such other actions as may be necessary or desirable to protect Xxxxxx Xxxxxxxx'x interests therein. Upon request, you shall execute any and all applications, assignments, or other documents that Quaker Houghton deems necessary and desirable for such purposes. You have attached hereto a list of unpatented inventions that you have made or conceived prior to your employment with Quaker Houghton, and it is agreed that those inventions shall be excluded from the terms of this Agreement.
8.Termination.
(a)Either party may terminate this Agreement per the terms of Section 3 hereof and Quaker Houghton, in its sole discretion, may terminate your employment at any time for Cause (as defined herein). If you incur a Separation from Service (as defined below) by decision and action of Xxxxxx Xxxxxxxx for any reason other than Cause, death, or Disability (as defined below), Xxxxxx Xxxxxxxx agrees to:
1. Provide you with reasonable outplacement assistance, either by providing the services in-kind, or by reimbursing reasonable expenses actually incurred by you in connection with your Separation from Service. The outplacement services must be provided during the one-year period following your Separation from Service. If any expenses are to be reimbursed, you must request the reimbursement within eighteen months of your Separation from Service and reimbursement will be made within 30 days of the receipt of your request; and
2. Pay you twelve months’ severance in bi-weekly installments commencing on the Payment Date (as defined below) and continuing on Quaker Houghton's normal payroll dates thereafter, each of which is equal to the total of your bi-weekly base salary at the time of your Separation from Service, provided you sign a Release within 45 days of the later of the date you receive the Release or your Separation from Service. Continuation of all medical and dental coverage’s will also be available for 18 months at a level equal to the coverage provided before your Separation from Service.
(b)If the Executive dies during the Term of Employment, the Company shall not thereafter be obligated to make any further payments under this Agreement except for amounts accrued as of the date of the Executive’s death, and except that the Company shall pay a single-sum cash death benefit to the Executive’s Beneficiary equal to 200% of the annual rate of the Executive’s base salary as in effect on the day before the Executive’s death or be entitled to the death benefit (as a multiple of base salary) to which any other executive officer would be entitled. To that end, the Company currently has a program in which all executive officers in the Company’s Executive Leadership Team participate, which entitle each to a death benefit equal to 100% of base salary in the year of death and 50% of base salary in each of the four years thereafter. “Beneficiary” shall mean the person designated by the Executive to receive benefits under this Agreement in a writing filed by the Executive with the Company’s human resources department before the Executive’s death or, if the Executive fails to designate a beneficiary or the designated beneficiary predeceases the Executive, the Executive’s Beneficiary shall be his surviving spouse or, if the Executive has no surviving spouse, his estate.
(c)Disability of Executive. If the Executive is unable to perform his duties hereunder by reason of disability as defined in the Company’s Long-Term Disability Plan (“Disability”), then the Board shall have the right to terminate the Executive’s employment upon 30 days prior written notice to the Executive at any time during the continuation of such Disability. In the event the Executive is terminated pursuant to this Section 8(c), the Company shall not thereafter be obligated to make any further payments under this Agreement except for amounts accrued as of the date of such termination, and except that the Executive shall receive supplemental disability payments. Such supplemental disability payments shall be paid to the Executive after the Executive’s Separation from Service at the same time that disability payments are due to be paid to the Executive under the Company’s Long-Term Disability Plan and each such payment shall be equal to the excess of (a) the amount that would be payable under the Company’s Long-Term Disability Plan (disregarding any withholding) if the Executive elected a benefit of 50% of applicable pay and such plan did not limit the dollar amount of periodic payments thereunder, over (b) the amount that would be payable under the Company’s Long-Term Disability Plan (disregarding any withholding) if the Executive elected a benefit of 50% of applicable pay. The “Company’s Long-Term Disability Plan” shall mean the long-term disability plan maintained by the Company for employees generally; provided, however, that if the Company does not maintain such a long-term disability plan at the time of the Executive’s termination under this Section 8(c), or terminates such plan after the Executive’s termination of employment but before all disability payments have been paid to the Executive under the terms of such plan as in effect prior to its termination, (x) the “Company’s Long-Term Disability Plan” shall mean the long-term disability plan most recently maintained by the Company for employees generally, and (y) the amount determined under subsection (b) shall equal zero dollars ($0). Such supplemental disability payments shall be payable from the Company’s general assets or, if the Company so elects, from a supplemental disability policy purchased by the Company.
“Separation from Service” means your separation from service with Quaker Houghton and its affiliates within the meaning of Treas. Reg. §1.409A-1(h) or any successor thereto.
“Cause” means your employment with Xxxxxx Xxxxxxxx has been terminated by reason of (i) your willful and material breach of this Agreement (after having received notice thereof and a reasonable
opportunity to cure or correct) or the Company’s policies, (ii) dishonesty, fraud, willful malfeasance, gross negligence, or other gross misconduct, in each case relating to the performance of your duties hereunder which is materially injurious to Quaker Houghton, or (iii) conviction of or plea of guilty or nolo contendere to a felony.
“Payment Date” means (x) the 60th day after your Separation from Service or (y) if you are a specified employee (as defined in Treas. Reg. §1.409A-1(i)) as of the date of your Separation from Service, and the severance described in subsection (b) is deferred compensation subject to section 409A of the Code, the first business day of the seventh month following the month in which your Separation from Service occurs. If the Payment Date is described in clause (y), the amount paid on the Payment Date shall include all monthly installments that would have been paid earlier had clause (y) not been applicable, plus interest at the Wall Street Journal Prime Rate published in the Wall Street Journal on the date of your Separation from Service (or the previous business day if such day is not a business day), for the period from the date payment would have been made had clause (y) not been applicable through the date payment is made.
“Release” means a release (in a form satisfactory to Quaker Houghton) of any and all claims against Quaker Houghton and all related parties with respect to all matters arising out of your employment with Quaker Houghton, or the termination thereof (other than for claims for any entitlements under the terms of this Agreement or any plans or programs of Quaker Houghton under which you have accrued a benefit) that Quaker Houghton provides to you no later than ten days after your Separation from Service. If a release is not provided to you within this time period, the severance shall be paid even if you do not sign a release.
9. Indemnification
Xxxxxx Xxxxxxxx shall defend you and hold you harmless to the fullest extent permitted by applicable law in connection with any claim, action, suit, investigation or proceeding arising out of or relating to performance by you of services for, or actions of you as a director, officer, or employee of Quaker Houghton or any parent, subsidiary or affiliate of Quaker Houghton, or of any other person or enterprise at Quaker Houghton’s request. Expenses incurred by you in defending such a claim, action, suit or investigation or criminal proceeding shall be paid by Xxxxxx Xxxxxxxx in advance of the final disposition thereof upon the receipt by the Company of an undertaking by or on your behalf to repay said amounts unless it shall ultimately be determined that you are entitled to be indemnified hereunder; provided, however, that this shall not apply to a nonderivative action commenced by Xxxxxx Xxxxxxxx against you.
10. Governing Law.
The provisions of this Agreement shall be construed in accordance with the laws of the Commonwealth of Pennsylvania without reference to principles of conflicts of laws.
11. Miscellaneous
This Agreement and the Change in Control Agreement to which you are a party, constitute the entire integrated agreement concerning the subjects covered herein. In case any provision of this Agreement shall be invalid, illegal, or otherwise unenforceable, the validity, legality, and enforceability of the remaining provisions shall not thereby be affected or impaired. You may not assign any of your rights
or obligations under this Agreement without Quaker Houghton’s prior written consent. Quaker Houghton may assign this Agreement in its discretion, including to any affiliate or upon a sale of assets or equity, merger, or other corporate transaction; provided that Quaker Houghton obtains the assignee’s written commitment to honor the terms and conditions contained herein. This Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Pennsylvania without regard to any conflict of laws. This Agreement shall be binding upon you, your heirs, executors, and administrators and shall inure to the benefit of Xxxxxx Xxxxxxxx as well as its successors and assigns. In the event of any overlap in the restrictions contained herein, including Sections 4 and/or 5 above, with similar restrictions contained in any other agreement, such restrictions shall be read together so as to provide the broadest restriction possible.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day and year first above written.
| WITNESS: | QUAKER CHEMICAL CORPORATION DBA QUAKER HOUGHTON | |||||||
| WITNESS: | ||||||||
| XXX XXXXX | ||||||||
| [/s/ XXX XXXXX] | ||||||||
| Executive to sign here | ||||||||
ADDENDUM 1
| Base Salary: | Your salary will be payable on a bi-weekly basis with an initial annualized salary of $515,000. You will be eligible for your next salary increase review in 2025. | ||||
Annual and Long- Term Bonus and Grants: | For your position, you are eligible to participate in the full year 2024 Annual Incentive Plan (“AIP”) with a target award percentage of 65% of your base salary, dependent upon Quaker Houghton’s financial results, organizational context, and individual performance. You will be eligible to participate in the 2024-2026 Long-Term Incentive Plan (“LTIP”) for the full year of 2024. Your award for the 2024-2026 performance period includes a mix of time-based restricted stock units (RSU’s) (40%) and target performance stock units (PSU’s) (60%) of the total award. The value at a target level is $850,000. The PSU’s are for a three-year performance period and the RSU’S will vest ratably over a 3-year period. Annual LTI awards are discretionary and require approval from the Compensation and Human Resources Committee and are granted either on the 15th of the month of hire or on the 15th of the following month. | ||||
Special One-time Grant: | An equity sign-on award of $400,000 RSU’s which will vest in its entirety on the two (2) year anniversary of the grant date. Such award is subject to a claw-back and must be repaid to the Company if you voluntarily terminate your employment with Quaker Houghton or are terminated for cause within the three (3) years of your tenure with Xxxxxx Xxxxxxxx. LTI awards are discretionary and require approval from the Compensation and Human Resources Committee and are granted either on the 15th of the month of hire or on the 15th of the following month. | ||||
Additional Forfeitures Temporary Housing Executive Financial Wellbeing and Financial Planning: | You will be provided with a one-time lump sum payment of approximately $12,000 to cover the cancellation of your current apartment lease and the movement of household goods from Utah to Minnesota. This payment will be grossed-up for federal, state, and local income and employment taxes. You will provide the company with documentation associated with these costs and will be paid the one-time lump sum, as soon as administratively feasible after your start date. If you voluntarily resign prior to completing two (2) years of employment with the company, you agree to reimburse Quaker Xxxxxxxx for the full amount of the payment(s) that was made during the previous two-year period. Quaker Houghton will provide temporary housing during the transition to the Philadelphia area for up to 90 days. Movement of household goods to support short term living will be paid by Xxxxxx Xxxxxxxx. Further information regarding these services will be provided upon acceptance of a formal offer of employment. You will be eligible to participate in the company’s health and welfare benefit programs in accordance with and subject to the terms and conditions of such plans or programs. As a member of the Executive Leadership Team, you are eligible for our Executive Financial Wellbeing benefit. The Financial Wellbeing benefit provides you support for eligible expenses that you incur for financial and tax planning activities. Xxxxxx Xxxxxxxx partners with Xxxxxxx Xxxxx Ayco to assist you with these services. The cost of the Ayco’s Tax and Financial Planning service is up to $15,500 annually and will be fully paid for by Quaker Houghton. You are only responsible for the taxes on any imputed income. The decision to use Xxxxxxx Xxxxx Ayco or another provider is your choice. Should you elect a different provider, you are eligible for a reimbursement on eligible expenses up to $3,500. Either benefit option is provided on a calendar year basis and is a taxable benefit. You must be employed by Xxxxxx Xxxxxxxx when the services are provided to receive this reimbursement. Upon separation from service following retirement, company-initiated termination without cause, long-term disability or death of a participating executive, Xxxxxx Xxxxxxxx will pay for the benefit for the year of the separation from service and one-year post separation from service. In the event of a change in control, Xxxxxx Xxxxxxxx will pay for the benefit for the year in which the change in control occurs and for one calendar year thereafter. | ||||
Executive Medical Benefits Other Benefits: | In partnership with external medical providers, we will provide proactive and preventative healthcare offerings in 3 available options to each of you and your spouse (should you choose): Executive Physical (in partnership with Penn Medicine), Executive Medical Concierge services (in partnership with Penn Medicine OR MDVIP), or Executive Medical reimbursement coverage through a provider of your choice (ex. Mayo Clinic). Xxxxxx Xxxxxxxx will cover the financial cost of these offerings. Quaker Houghton offers a Flexible Benefits Program that is subject to change. This gives you the opportunity to choose from a variety of options creating a customized benefits package. The following benefits are currently part of the program. In each of these areas, you are offered a range of options so you may choose the ones that make the most sense for your personal situation. •Medical •Dental •Life & AD&D Insurance •Long-term Disability •Health Care and Dependent Care Flexible Spending Accounts (FSAs) •Retirement Savings Plan (401K) | ||||
