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EXHIBIT 10.32
AGREEMENT
AGREEMENT, dated as of February 18, 2000, by and between AMERICAN
NATIONAL CAN GROUP, INC., a Delaware corporation, AMERICAN NATIONAL CAN COMPANY,
a Delaware corporation (collectively, the "Company"), and the individual named
on the signature page hereof (the "Executive").
WHEREAS, the Executive and the Company desire to enter into this
Agreement pertaining to the terms of the employment of the Executive by the
Company in such capacities;
NOW, THEREFORE, in consideration of the covenants and agreements
herein contained, the parties hereto hereby agree as follows:
1. DEFINED TERMS. For purposes of this Agreement, the following terms
shall have the following meanings:
(a) "AFFILIATE" means, with respect to any person (including without
limitation the Company), any corporation or other entity that, directly or
indirectly, controls or is controlled by such person, or that is under common
control with such person.
(b) "Board" means the Board of Directors of American National Can
Group, Inc.
(c) "CAUSE" means (A) serious misconduct or gross negligence in the
performance of the Executive's employment duties; (B) willful disobedience by
the Executive of lawful directions received from or policies established by the
Chief Executive Officer, any other executive to whom the Executive reports or
the Board; or (C) commission by the Executive of a crime involving fraud that
can reasonably be expected to have an adverse effect on the business, reputation
or financial situation of the Company. The Executive shall be permitted to
respond and defend himself before the Board within 15 days after written
notification of any proposed termination for Cause which shall specify in detail
the reasons for such termination.
(d) "CODE" means the Internal Revenue Code of 1986, as amended.
(e) "CONFIDENTIAL INFORMATION" includes, without limitation, the
client lists of the Company and its Subsidiaries and Affiliates, their
respective trade secrets, any confidential information about (or provided by)
any customer or supplier, or prospective or former customer or supplier, of the
Company or any of its Subsidiaries or Affiliates, information concerning the
business or financial affairs of the Company or any of its Subsidiaries or
Affiliates, including books and records, commitments, procedures, plans and
prospects, strategies, or current or
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prospective transactions or business, and any other "inside information", (i)
which has not been disclosed publicly by the Company or one of its Subsidiaries
or Affiliates, or with its consent, (ii) which is otherwise not a matter of
public knowledge or (iii) which is a matter of public knowledge and the
Executive has reason to know that such information became a matter of public
knowledge through an unauthorized disclosure.
(f) "CONTINUATION PERIOD" means the period beginning on the
Termination Date and ending on the second anniversary thereof.
(g) "COVENANT PERIOD" means the period beginning on the date of this
Agreement and ending on the second anniversary of the Termination Date.
(h) "EQUITY PLAN" means any stock option, restricted stock, stock
appreciation right, phantom stock, equity incentive or similar plan which awards
are denominated in, or the value of which is determined by reference to, equity
securities of the Company.
(i) "GOOD REASON" means (A) a material reduction in the Executive's
status, duties or responsibilities as in effect on the date of this Agreement,
or (B) a reduction in the Executive's annual target compensation opportunity,
defined as base salary plus annual targeted incentive award, by either the
Company or a successor company, or (C) Executive is required to relocate outside
of a fifty mile radius of his current office without his prior written consent,
or (D) Employer fails to pay Executive any amount otherwise vested and due under
the Agreement or under any plan or policy of the Employer, which such failure is
not cured within thirty (30) days following written notice of failure given to
the Employer, or (E) the Employer fails to obtain an agreement to expressly
assume this Agreement from any successor company to the Employer, or (F) the
Employer is in material breach of the Agreement, which breach is not cured
within thirty (30) days following written notice of breach given to the
Employer.
(j) "MIP" means the Company's Management Incentive Plan, as the same
may be amended from time to time, or any successor plan.
(k) "PENSION PLANS" means, collectively, the Company's Pension Plan
for Salaried Employees and certain other non-qualified pension plans or
arrangements that the Company maintains for its senior executives.
(L) "SUBSIDIARY" of a person (including without limitation the
Company) means a corporation with respect to which such person, directly or
indirectly, has the power, whether through the ownership of voting securities,
by contract or otherwise, to elect at least a majority of the members of such
corporation's board of directors.
(m) "TERMINATION DATE" means the effective date of the Executive's
termination of employment with the Company.
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2. GENERAL TERMS OF EMPLOYMENT.
(a) NATURE AND TERM OF THIS AGREEMENT. This Agreement does not
constitute a guarantee of continued employment but instead provides for certain
rights and benefits for the Executive during, and upon termination of, his
employment. The Company retains the right to terminate the Executive for Cause
at any time, and the Executive retains the right to resign for Good Reason at
any time.
(b) TITLE, DUTIES AND RESPONSIBILITIES. The Executive's title will be
Senior Vice President, General Counsel and Secretary. In this capacity the
Executive will report to the Executive Vice President Administration and Chief
Human Resource Officer. For so long as the Executive's employment with the
Company continues, the Executive will devote his full business time, attention
and best efforts to the affairs of the Company, will faithfully serve the
Company, and in all respects conform to and comply with the lawful directions
and instructions consistent with his position as Senior Vice President and
General Counsel given to him by the Company's Chief Executive Officer, the
executive to whom he reports, or the Board.
(c) BASE SALARY. The Executive's base salary shall be reviewed
periodically by the Company at the times and in a manner consistent with the
review of base salaries of the Company's other senior executives, and, based on
such review, the amount of the Executive's base salary may be adjusted upwards
but not downwards, in the discretion of the Company, taking into account the
Executive's performance and any other factors the Company deems relevant.
(d) PARTICIPATING IN BENEFIT PROGRAMS. During the period of the
Executive's employment with the Company he will be eligible to participate in
the Company's compensation (including short-term and long-term incentive
compensation) and benefit programs applicable generally to the Company's senior
executives. Such programs may be adjusted or modified from time to time by the
Company in its discretion.
3. SEVERANCE BENEFITS UPON TERMINATION. If the Executive's employment
with the Company is terminated by the Company for any reason other than for
Cause, or if the Executive resigns from employment with the Company, or a
successor company, under circumstances constituting Good Reason, then, during
the Continuation Period, the Executive shall be eligible to receive the
severance benefits described in this Section 3. In the event of a termination by
the Company for any reason other than for Cause, then the Company will provide
the Executive with a minimum of two months notice prior to the Termination Date,
but in no event shall such notice be given earlier than August 1, 2000.
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(a) BASE SALARY CONTINUATION. The Company will pay the Executive his
base salary equivalent, at the rate in effect immediately prior to the
Termination Date (or if the Executive has resigned for Good Reason by virtue of
the Company having reduced his rate of base salary, at the rate of base salary
in effect prior to such reduction) consistent with normal payroll practice. The
payments following the Termination Date shall be in lieu of any and all
severance pay to which the Executive might otherwise be entitled under any plan
or program of the Company or any of its Subsidiaries or Affiliates.
(b) INCENTIVE COMPENSATION.
(i) MIP. The Company will pay the Executive a pro-rata MIP award
reflecting a partial year participation in the year of termination,
based on a fraction, the numerator of which is the number of days in
such calendar year, up to and including the Termination Date, and the
denominator of which is 365. The award shall be calculated in
accordance with the MIP plan in effect at the time of termination,
provided, however, that the award shall be no less than the target
award for the applicable period of time prior to the Termination Date.
The target award assumes business and individual performance at the
100% level. This payment will be made in accordance with the Company's
normal payment practice for the MIP at the time payments under the MIP
are made to other executives of the Company.
(ii) Equity Plan. The Executive will retain any awards that were made
to him under any Equity Plan prior to the Termination Date, and the
Executive shall be entitled to exercise any such awards, in accordance
with the provisions of the grant or the plan, but in no event later
than the last date allowable under the applicable grant.
(iii) Restricted Stock. Any shares of restricted stock or any right to
receive shares of stock granted to the Executive will continue to vest
during the Continuation Period provided that vesting was dependent
upon continued service, and following the Continuation Period will
vest in accordance with the provisions of the plan for terminated or
retired employees. If the applicable plan or grant agreement
contemplates vesting terms using a termination date, the termination
date for the purposes of the grant shall be the last day of the
Continuation Period.
Except for the payments and other benefits provided in this subsection (b), the
Executive shall have no right to any other payment or benefit under the MIP, the
Equity Plan or any other annual, equity or long-term incentive plan of the
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Company. Without limiting the generality of the preceding sentence, this
Agreement shall not confer any right on the Executive following the Termination
Date to be granted any further awards under any Equity Plan, long-term incentive
plan or any subsequent equity or long-term incentive plans.
(c) HEALTH AND WELFARE BENEFIT. The Executive shall be eligible to
participate (or continue to participate) in the Company's medical, dental and
life insurance benefits of the Company, on the same terms and conditions
(including without limitation any provisions concerning payment of premiums,
deductibles and co-payments) that apply to active salaried employees of the
Company. Such coverage shall be secondary to any benefits the Executive or his
family becomes eligible to receive under a comparable program of a subsequent
employer.
(d) EXECUTIVE SPLIT-DOLLAR LIFE INSURANCE. Following the Termination
Date, the Company will make all premium payments due on the split-dollar life
insurance policies issued by Northwestern Mutual Life Insurance Company and
currently held in the Executive's name, including the economic benefit value
normally paid by the Executive following the seventh year of the policy (the
"Executive's Portion"), and the minimum required individual taxes resulting from
the payments. At the time of policy takeover the Executive will reimburse the
Company for all returnable escrow deposits paid by the Company in accordance
with the terms of the plan. The Executive shall not be required to reimburse the
Company for the Executive's Portion paid by the Company following the
Termination Date.
(e) COMPANY CAR. Title to the automobile made available to the
Executive immediately prior to the Termination Date will be transferred to him
at no additional cost as of the Termination Date; provided, however, that the
Executive will be responsible for all additional costs for the vehicle over and
above the Company's category cost for vehicles at his executive level, and all
income taxes, transfer taxes and similar governmental charges regarding the
transfer and new registration of the vehicle.
(f) OUTPLACEMENT SERVICES. The Executive will be eligible for
executive level Outplacement counseling with an outplacement service selected
and paid for by the Company which outplacement service is reasonably acceptable
to the Executive.
(g) CAPITAL ACCUMULATION PLAN ("CAP") MAKE-UP. Following the
Termination Date the Executive will be ineligible to participate in the
Company's CAP Plan. The Company will pay the Executive the amounts it would have
contributed on his behalf to the CAP as matching contributions and or
discretionary profit-sharing contributions during the Continuation Period,
assuming the Executive had elected to participate in the CAP at the maximum
level permitted thereunder. All such payments will be made on an after-tax
basis. Payment of the matching contribution equivalents will be made at the
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same time as the base salary equivalent payments. Discretionary profit-sharing
contribution equivalents will be paid at approximately the same time as the
Company makes such contributions (if any) to the CAP.
(h) PENSION BENEFIT. The Executive shall continue to earn service
credit towards the total pension benefit calculation until the end of the
Continuation Period and at such time shall be eligible for an unreduced pension
benefit under the Pension Plan for Salaried Employees based on minimum age 60
and minimum 30 years service. The Company shall determine in its discretion
whether, and to the extent that, any supplemental monthly pension benefit
required under this Section 3(h) shall be paid through a Pension Plan that is
intended to be qualified under Section 401(a) of the Code, or any successor
provision thereto, or under a Pension Plan or other arrangement that is not
intended to be so qualified.
(i) CONSULTING. If the services of the Executive are requested by the
Company or its Subsidiaries during, or following, the Continuation Period (as
defined in the Agreement) and the Executive agrees to provide such services,
compensation will be paid at the daily rate of $1,500.00 plus reimbursement of
any reasonable business related expenses, including travel, from the Executive's
place of residence.
(j) NO IMPAIRMENT OF EXISTING RIGHTS. Nothing in this Agreement shall
be construed to reduce or impair in any way the Executive's rights and benefits
under the Pension Plans, including any rights and benefits that he may accrue
under the Pension Plans after the date hereof and prior to his termination of
employment with the Company.
4. DEATH AND DISABILITY. If the Executive dies or becomes totally
disabled during the Continuation Period, the Executive or his estate, as the
case may be, will be entitled to the severance benefits provided for in this
agreement (other than outplacement services), as well as to the standard
benefits and insurance payments under the benefits plans of the Company then in
effect, determined as though his employment with the Company had terminated by
virtue of death or total disability.
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5. CERTAIN COVENANTS.
(a) COVENANT NOT TO COMPETE. The Executive agrees that during the
period of his employment with the Company and continuing through the Covenant
Period:
(i) he will not without the consent of the CEO of the Company,
reasonably exercised, engage in any activities, whether as employee, agent,
proprietor, owner, partner, contractor, stockholder (other than the holder
of less than 5% of the stock of a corporation the securities of which are
traded on a national securities exchange or in the over-the-counter
market), director or otherwise, in competition with the businesses
conducted by the Company and its Subsidiaries on the date hereof or in
which they are substantially engaged at any time during the Covenant
Period; and
(ii) he will not solicit, in competition with the Company or any of
its Subsidiaries, any person who is a customer of the businesses conducted
by the Company or any of its Subsidiaries at the date hereof or any
businesses in which the Company or any of its Subsidiaries are
substantially engaged at any time during the Covenant Period.
(b) TERRITORIAL REACH. The covenants contained in clauses (i) and (ii)
of subsection (a) of this Section 5 shall apply within the territories in which
the Company or any of its Subsidiaries are actively engaged in the conduct of
the businesses described in such covenants at the relevant time, including,
without limitation, the territory in which customers are then solicited.
(c) COVENANT NOT TO INDUCE TERMINATION OF EMPLOYMENT. The Executive
agrees that during the Covenant Period he will not, without the prior written
consent of the Company (which consent may be withheld by the Company at its sole
discretion), induce or attempt to persuade any employee of the Company or any of
its Subsidiaries to terminate his employment relationship in order to enter into
any other employment, whether or not such other employment is competitive with
the Company or any of its Subsidiaries.
(d) COVENANT NOT TO DISCLOSE CONFIDENTIAL INFORMATION. The Executive
agrees that he will not, at any time during the Covenant Period or thereafter,
make use, for his own benefit or the benefit of any other person or entity, of
Confidential Information of any kind or character, nor divulge Confidential
Information except to the extent the Company's Chief Executive Officer or the
Board may so authorize in writing, and that within ten days of the Termination
Date the Executive will surrender to the Company all records, in whatever form
maintained (including without limitation records maintained as computer files)
and other documents and materials obtained by the Executive or entrusted to him
during the course of his employment by the Company or any of
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its Subsidiaries or Affiliates (together with all copies thereof) which related
to any such Confidential Information. Nothing set forth in this subsection (d),
however, shall be interpreted to prohibit the Executive from disclosing any such
information as may be required by law, including pursuant to any court or
government decree or subpoena.
(e) REMEDIES. Without limiting the right of the Company to pursue all
other legal and equitable remedies available for violation by the Executive of
the covenants contained in this Section, it is expressly agreed that if the
Executive materially breaches the covenants set forth in this Section and fails
to cure such breach to the reasonable satisfaction of the Company within 30 days
after written notice thereof, any further obligations of the Company pursuant to
this Agreement shall be canceled. Without limiting the generality of the
preceding sentence, the Executive acknowledges and agrees that, in the event of
such material breach and failure to cure, the Company will have no further
obligation to pay or provide any of the severance benefits described in Section
3 above, excluding the pension benefits. In addition, the Executive acknowledges
that a breach of any of the covenants set forth in this Section may result in
material irreparable injury to the Company for which there is no adequate remedy
at law, that it will not be possible to measure damages for such injuries
precisely and that, in the event of such a breach or threat thereof, the Company
shall be entitled, in addition to any other rights or remedies it may have
(including without limitation the remedy provided in the preceding sentence), to
obtain a temporary restraining order and a preliminary or permanent injunction
enjoining or restraining the Executive from engaging in activities prohibited by
this Section or requiring his compliance with the affirmative obligations
provided for herein.
(f) ENFORCEABILITY. It is the intent and understanding of each party
hereto that if in any action before any court or agency legally empowered to
enforce the covenants contained in this Section any term, restriction, covenant
or promise contained herein is found to be unreasonable and accordingly
unenforceable, then such term, restriction, covenant or promise shall be deemed
modified to the extent necessary to make it enforceable by such court or agency.
6. CONFIDENTIALITY OF THIS AGREEMENT. Except as required by law,
judicial order, or other lawful process, the parties hereto will keep
confidential and not disclose, directly or indirectly, to any person, firm,
corporation, association, or other entity, except family and professional
financial and legal advisors, the existence or terms of this Agreement.
7. NO UNFAVORABLE COMMENTS. The Company agrees to refrain from making
now or any time in the future any comment reflecting unfavorably upon the
Executive to the press, any individual or entity with whom the Executive has a
business relationship or any individual or entity making an
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inquiry as to the Executive's employment relationship with the Company, except
to the extent that any such comment may relate to circumstances underlying a
termination of the Executive's employment for Cause. The Executive agrees to
refrain from making now or at any time in the future any comment reflecting
unfavorably upon the Company or any of its Subsidiaries and Affiliates or any
current or former directors, officers or employees of the Company to the press,
any employees of the Company or any individual or entity with whom any member of
the Company has a business relationship.
8. FULL SATISFACTION; RELEASE. This Agreement supercedes all previous
letters and agreements between the Executive and the Company or any predecessor
companies, including but not limited to, the Employee Agreement dated September
7, 1982, the Addendum to the Employee Agreement, and the Rider to the Addendum
to the Employee Agreement. The Executive agrees that the payments and other
benefits to be provided pursuant to this Agreement shall be in full satisfaction
of any and all claims for payment or any other benefits that he may have against
the Company or any of its Subsidiaries or Affiliates arising out of (i) his
employment with the Company or his status as an executive of the Company or any
of the Company's Subsidiaries, Affiliates or divisions, or (ii) the termination
of such employment and status; excluding (A) claims that arise out of an
asserted breach of this Agreement and (B) claims for indemnification the
Executive may now or in the future have under any bylaw, agreement or otherwise.
In addition, in consideration of the agreements set forth herein, the Company,
on the one hand, and the Executive, on the other hand, release and waive all
claims, causes of action or the like arising on or before the date hereof,
regardless of whether or not known at present (including, without limitation,
any claims arising under the Age Discrimination in Employment Act of 1967, Title
VII of the Civil Rights Act of 1964 as amended by the Civil Rights Act of 1991,
the Equal Pay Act of 1962, the Americans with Disabilities Act of 1990, or any
other federal, state or local statute or ordinance; but excluding, in the case
of both the Company and the Executive, any claims that arise out of an asserted
breach of the terms of this Agreement), that either has or may have in the
future against the other and, in the case of the Company, their respective
successors, shareholders, directors, officers, agents and employees, regarding
all matters relating to the Executive's service as an employee of the Company or
any of its Subsidiaries, Affiliates or divisions, and to the termination of such
relationships, including, without limitation, all claims related to the payment
of compensation and benefits and all claims arising under any Federal or state
statute or regulation. The Executive and the Company shall execute as of the
second anniversary of the Termination Date any further documents as may
reasonably be requested by the other in order to evidence and give effect to the
provisions of this Section.
9. SOURCE OF PAYMENTS. All payments provided under this Agreement,
other than payments made pursuant to a benefit plan which may
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provide otherwise, shall be paid in cash from the general funds of the Company,
and no special or separate fund shall be established, and no other segregation
of assets made, to assure payment. The Executive shall have no right, title or
interest whatever in or to any investments which the Company may make to aid the
Company in meeting its obligations hereunder. Nothing contained in this
Agreement, and no action taken pursuant to its provisions, shall create or be
construed to create, a trust of any kind, or a fiduciary relationship, between
the Company and the Executive or any other person. To the extent that any person
acquires a right to receive payments from the Company hereunder, such right
shall be no greater than the right of an unsecured creditor of the Company.
10. FUTURE COOPERATION. The Executive agrees that following
termination of his employment with the Company he will make himself available in
any then pending or future governmental or regulatory investigation, civil or
administrative proceeding or arbitration related to the Executive's duties while
employed by the Company, subject to the Executive's other personal and business
commitments. The Company will promptly reimburse the Executive for all
reasonable costs and expenses, including attorneys' fees, incurred by the
Executive in connection with any such proceedings or arbitration.
11. TAX WITHHOLDING. All amounts payable to the Executive pursuant to
this Agreement shall be subject to all legal requirements with respect to the
withholding of taxes including FICA.
12. MISCELLANEOUS.
(a) ENTIRE AGREEMENT; CONDITIONS; AMENDMENTS. This Agreement sets
forth the entire understanding of the parties hereto with respect to the subject
matter hereof and cannot be amended or modified except by a writing signed by
all such parties. The waiver by either party of compliance with any provision of
this Agreement by the other party shall not operate or be construed as a waiver
of any other provision of this Agreement or of any subsequent breach by such
party of a provision of this Agreement.
(b) ASSIGNMENT AND DELEGATION. Neither this Agreement nor any right,
duty or obligation hereunder shall be assignable or delegable by the Executive.
This Agreement, and all rights, duties and obligations herein, may be assigned
by the Company to any person or entity that succeeds to the interest of the
Company (regardless of whether such succession does or does not occur by
operation of law) by reason of the sale of all or a portion of the Company's
stock, a merger, consolidation or reorganization involving the Company or,
unless the Company otherwise elects in writing, a sale of the assets of the
business of the Company (or portion thereof) in which Executive performs, or
will perform, a majority of his services. Upon any such assignment, delegation
or transfer, any such business entity shall be deemed to be substituted for all
purposes as the
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Company hereunder. The Company shall cause such successor expressly to assume
such obligations.
(c) COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same instrument.
(d) HEADINGS. The headings of the Sections of this Agreement are
included solely for convenience of reference and shall not be construed or
interpreted in any way as affecting the meaning of such Sections.
(e) GOVERNING LAW. This Agreement is governed by, and construed and
interpreted in accordance with, the laws of the State of Illinois. Any dispute
under this Agreement shall be adjudicated by a court of competent jurisdiction
in the State of Illinois.
(f) INDEMNIFICATION. The Company will indemnify the Executive to the
fullest extent permitted by the laws of the state of incorporation in effect at
that time, or certificate of incorporation and bylaws of the Company whichever
affords the greater protection to the Executive. The foregoing indemnification
shall continue to apply following the Termination Date for acts or omissions by
the Executive while an employee of the Company.
(g) SURVIVORSHIP. The provisions of this Agreement necessary to carry
out the intention of the parties as expressed herein shall survive the
termination or expiration of this Agreement. IN WITNESS WHEREOF, the parties
hereto have executed this Agreement this 18th day of February, 2000.
AMERICAN NATIONAL CAN GROUP, INC.
AMERICAN NATIONAL CAN COMPANY
By: /s/ XXXXXX XXXXXXXXX
Name: Xxxxxx Xxxxxxxxx
Title: Executive VP Administration and
Chief Human Resource Officer
EXECUTIVE
/s/ XXXXXXX X. XXXXXXXX
Xxxxxxx X. Xxxxxxxx
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