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AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement ("Agreement")
effective as of July 1, 1996 (the "Effective Date"), by and between PVC
CONTAINER CORPORATION ("Employer"), a corporation organized under the laws of
Delaware and having its principal place of business at 000 Xxxxxxxxxx Xxx Xxxx,
Xxxxxxxxx, Xxx Xxxxxx 00000 and Xxxxxxx X. Xxxxxxxx of 00 Xxxxx Xxxx,
Xxxxxxxxxx, Xxx Xxxxxx 00000 ("Employee").
W I T N E S S E T H:
WHEREAS, pursuant to the terms of an employment agreement
dated July 1, 1982 as amended between Employer and Employee, Employee has been
and is presently employed by the Employer as its President and Chief Executive
Officer;
The parties thereto have agreed that Employer and Employee
shall enter into this Amended and Restated Employment Agreement upon the terms
and conditions set forth herein; and which on the Effective Date will replace
and supersede the employment agreement as amended dated July 1, 1982.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein set forth and other good and valuable consideration, the
receipt and adequacy of which is mutually acknowledged, it is agreed by and
between the parties as follows:
1. DEFINITIONS
For purposes of this Agreement, unless the context requires
otherwise, the following words and phrases shall have the meanings indicated
below:
"Cause" shall mean: (1) a felony conviction of the Employee
(or a plea of no lo contendere in lieu thereof); (2) the breach by the Employee
of any material provision of this Agreement, which breach, if curable, is not
remedied within thirty (30) days after the Employee's receipt of written notice
thereof; (3) an act of gross misconduct in connection with the Employee's duties
hereunder resulting in material prejudice to the Employer; or (4) habitual or
material neglect of the Employee's duties to the Employer (as determined in good
faith by the Board of Directors, continuing after prior written notice to the
Employee).
"Good Reason" shall mean (i) the material failure of the
Employer to comply with the provisions of this Agreement which failure shall not
cease promptly and in no event
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more than ten (10) days after the Employer's receipt of written notice from the
Employee objecting to such conduct; (ii) any purported termination by the
Employer of the Employee's employment other than as expressly permitted in this
Agreement; or (iii) the assignment to Employee of duties and responsibilities
inconsistent with those duties and responsibilities customarily assigned to
individuals holding the position of President and Chief Executive Officer of a
company of comparable size or the substantial reduction by Employer of
Employee's duties and responsibilities, all as determined by Employee.
2. REPRESENTATIONS AND WARRANTIES
Employee represents and warrants that he is not
subject to any restrictive covenants or other agreements or legal restrictions
in favor of any person which would in any way preclude, inhibit, impair or limit
his employment by the Employer or the performance of his duties, as contemplated
herein.
3. EMPLOYMENT
The Employer hereby employs Employee and Employee
accepts such employment as President and Chief Executive of the Employer. As its
President and Chief Executive Officer, Employee shall render such services to
the Employer as are customarily rendered by the President and Chief Executive of
comparable companies and as required by the articles and by-laws of the
Employer. Employee accepts such employment and, consistent with fiduciary
standards which exist between an employer and an employee shall perform and
discharge the duties that may be assigned to him from time to time by the
Employer in an efficient, trustworthy and businesslike manner. It is
specifically agreed that nothing in this Agreement shall prohibit Employee from
(i) serving on corporate, civic or charitable boards or committees; (ii)
engaging directly or indirectly, in activities with other public or private
companies or ventures; or (iii) making investments in any capacity whatsoever,
provided only that such activities or any of them do not significantly impair
Employee's performance of his duties for the Employer.
4. PLACE OF EMPLOYMENT
During the Term, the Employee shall render services
where and as reasonably required by the Employer. In conformance with the
foregoing and not in limitation thereof, Employee agrees to take such trips as
shall be consistent with or reasonably necessary in connection with his duties.
Employer will maintain an office within thirty (30) miles of the Employee's
residence and shall furnish the Employee both at the Employer's principal office
and at such other location with an office and secretarial help and such other
assistance, facilities and services consistent with Employee's position and
necessary for the adequate performance of his duties.
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5. TERM
Subject to the provisions of Section 10 hereof, the
term of this Agreement shall be deemed to commence on July 1, 1996 and shall
expire on June 30, 1999 (the "Initial Term"). If this Agreement is not renewed
or extended at the end of the Initial Term and each Term thereafter as
hereinafter defined for an additional period of two (2) years on substantially
the same or better terms than set forth herein for any reason whatsoever except
for Cause by the Employer, the Employer shall pay the Employee as severance the
compensation described in Paragraph 10(a) of this Agreement. The Initial Term of
this Agreement together with all renewals and extensions thereof are
collectively referred to herein as the "Term."
6. COMPENSATION
(a) As compensation for all services rendered and to
be rendered by Employee hereunder and the fulfillment by Employee of all of his
obligations herein, the Employer shall pay Employee a base salary the sum of One
Hundred and Sixty Five Thousand ($165,000) Dollars per annum payable in regular
installments consistent with the general policy of the Employer or in such other
regular installments as may be mutually agreed to by the Employee and the
Employer.
(b) The Base Salary for the twelve (12) month period
commencing July 1, 1997 and each successive twelve (12) month period of the Term
shall be reviewed and increased to the extent and in accordance with the
recommendation of the Compensation Committee of the Employer, if any, or of the
Board of Directors of the Employer.
(c) In addition to the Base Salary payable under
subparagraph (a) hereof, the Employer will pay during the Term of this Agreement
to the Employee a sum equal to four (4%) percent of the annual net income of the
Employer, before the payment of all Federal and State income taxes and
incentives paid to all employees of the Employer , as finally determined by the
regularly employed independent certified public accountants of the Employer
whose final determination shall be binding upon the Employer and the Employee.
Such additional compensation may be paid in regular quarterly installments
during the term of this Agreement based upon the net income before taxes as set
forth in the quarterly reports on Form 10-Q filed by the Employer with the
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934 subject, however, to adjustment based upon such final determination by the
regularly employed independent certified public accountants of the Employer in
the annual report on Form 10-K filed with the Commission. If the Employer shall
not file such reports on Form 10-Q, such quarterly installments shall be based
on the unaudited quarterly financial statements of the Employer prepared in
conformity with generally accepted accounting principles on a consistent basis.
There is no maximum amount of Base Salary and additional compensation payable to
the Employee pursuant to this Section 6.
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(d) Employee will participate in any Profit Sharing
Savings Plan, Deferred Compensation Plan, Incentive Stock Option Plan and
Employee Stock Ownership Plan of the Employer as applicable to executive
employees of the Employer.
(e) The Employer shall deduct from the compensation
described above, any Federal, state or city withholding taxes, social security
contributions and any other amounts which may be required to be deducted or
withheld by the Employer pursuant to any Federal, state or city laws, rules or
regulations.
(f) Any compensation otherwise payable to the
Employee pursuant to this Section in respect of any period during which the
Employee is disabled, as contemplated in Section 10, shall be reduced by any
amounts payable to the Employee for loss of earnings or the like under any
insurance plan or policy the premiums for which are paid for in their entirety
by the Employer.
7. BUSINESS EXPENSES
(a) The Employer shall pay, on behalf of Employee,
all dues to professional societies and other organizations as are customarily
joined by individuals holding the position of President and Chief Executive
Officer of businesses similar to the Employer and provide the Employee with a
new luxury automobile every five years. The Employer will require and shall
reimburse the Employee for his out of pocket cost of one complete physical
examination per fiscal year of the Term.
(b) The Employer agrees that the Employee is
authorized to incur reasonable expenses in the performance of his duties
hereunder and agrees that all reasonable expenses incurred by Employee in the
discharge and fulfillment of his duties for the Employer, as set forth in
Section 3, will be promptly reimbursed or paid by the Employer upon written
substantiation signed by Employee, itemizing said expenses and containing all
applicable vouchers. Employee shall be entitled to receive prompt reimbursement
for all reasonable travel and entertainment expenses and the costs of attending
conferences and seminars, so long as such expenses relate to Employee's ability
to serve the best interests of the Employer. In addition, within 30 days of the
rendition of the applicable invoices, Employer shall reimburse Employee annually
for the reasonable costs incurred by Employee in tax planning and tax return
preparation.
8. BENEFITS AND INSURANCE
(a) The Employer agrees that, during the Term, the
Employee shall be insured at the Employer's expense under all insurance policies
including any key man insurance policies on the lives of executives of the
Employer and shall receive all benefits under all pension and welfare benefit
plans (including, without limitation group life, medical,
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major medical and disability insurance) that the Employer may maintain and keep
in force during the Term of the Agreement for the benefit of the Employer's
employees, subject to the terms, provisions and conditions of such pension and
welfare benefit plans or insurance and the agreements with underwriters relating
to same. In addition, Employer will provide medical and major medical insurance
for Employee, his spouse and children of the Employee under the age of 21 years
during the Term and for the remainder of their respective lives, notwithstanding
the termination of Employee's employment hereunder, whether voluntary or
involuntary, or his Disability or death , consistent with the level and type of
coverage provided to Employee by any of Employer's existing policies.
9. VACATION
Employee shall be entitled to an aggregate of four
(4) weeks paid vacation during each year of the Term at time or times reasonably
agreeable to both the Employee and the Employer, it being understood that,
except as hereinafter provided, any portion of such vacation not taken in such
year shall not be available to be taken during any other year. However, up to
one week not taken in a particular year may be taken in the next succeeding year
in addition to the four (4) weeks.
10. TERMINATION; CHANGE OF CONTROL; DEATH; DISABILITY
(a) This Agreement shall only be terminable by the
Employer during the Term for Cause. In the event this Agreement is not renewed
or extended at the end of the Term for any reason whatsoever except termination
for Cause by the Employer or without Good Reason by the Employee, the Employer
shall pay to the Employee as of the end of the Term his accrued but unpaid Base
Salary and vacation pay and a cash payment in an amount equal to two (2) times
the average of the sum of the Base Salary, plus the additional compensation
provided for under Section 6(c) and (d) of this Agreement during the five
calendar years prior to such end of the Term.
(b) If the Employee becomes physically or mentally
disabled during the Term so that he is unable to perform the services required
of him pursuant to this Agreement for a period of six (6) successive months, or
an aggregate of six (6) months in any twelve (12) month period, the Employer may
give the Employee written notice of its intention to terminate the services of
the Employee hereunder. In such event, the Employee's employment with the
Employer shall terminate effective on the thirtieth (30th) day after receipt of
such notice by the Employee (the "Disability Effective Date") provided the
Employee shall not have returned to the performance of the Employee's duties.
Subject to the provisions of Section 6(f), in the event the Employee's
employment is terminated by the Employer for reasons of disability, the
Employer's obligations hereunder shall be (1) to continue the Base Salary (at
the rate in effect on the Disability Effective Date) for a period of three (3)
years from the Disability Effective Date; (2) to pay all amounts previously
deferred
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or accrued under Section 6(c) and the Deferred Compensation Plan and Profit
Sharing Plan, together with any interest accrued thereon) as prescribed by the
Employee; (3) to fully vest the Employee in any stock option which has been
granted previously to the Employee; and (4) to continue any and all such
benefits and insurance policies as required by Section 8 hereof.
(c) In the event of the Employee's death during the
Term, the Employer shall pay to his spouse, if he is survived by a spouse, or if
not, to the estate of the Employee, (1) the Employee's accrued and unpaid Base
Salary (at the rate in effect on the date of death) as of the date of death; and
(2) all amounts previously deferred or accrued under Section 6(c), the Deferred
Compensation Plan and Profit Sharing Plan as of the date of death (together with
any interest accrued thereon) and not yet paid by the Employer in the manner
prescribed by the executor of the Employee's estate. In the event of the
Employee's death during the Term, the Employee shall fully vest in any stock
option which has been granted previously to the Employee.
11. RESTRICTIVE COVENANTS
(a) For a period of two (2) years following
termination of this Agreement by the Employee without Good Reason, the Employee
(i) will not compete with the Employer in the business of the Employer as
carried at the time of termination or interfere with, disrupt or attempt to
disrupt the relationship, contractual or otherwise, between the Employer and any
customer, supplier, lessor or employee of the Employer or any of its
subsidiaries; (ii) divulge or use any confidential information the effect of
which would be injurious to the Employer without the prior written consent of a
duly empowered officer of the Employer; and (iii) will not solicit or employ any
person, who was employed by the Employer within six months prior to the
termination of Employee's employment, in any business in which Employee has a
material interest, direct or indirect, as an officer, partner, shareholder or
beneficial owner if the effect thereof would be materially detrimental to the
business of Employer, as Employer shall determine in its reasonable discretion.
12. INDEMNIFICATION
To the fullest extent permitted by Section 145 of the
General Corporation Law of Delaware, as the same may be amended and
supplemented, Employer shall indemnify Employee and hold him harmless from and
against any and all of the expenses, liabilities or other matters referred to or
in covered by said section (collectively, "Liabilities") if any of such
Liabilities are incurred or suffered by Employee as a result of, arising out of
or in connection with his employment by the Employer. In addition, as provided
in said section, the Employer shall advance expenses, including reasonable
attorneys' fees, of Employee. The indemnification and advancement of expenses
provided for herein shall continue after
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Employee has ceased to be a director, officer, employee or agent and shall inure
to the benefit of the heirs, executors and administrators of Employee.
13. BINDING EFFECT
This Agreement shall inure to the benefit of and be
binding upon the Employer and its successors and assigns. The Employer will
require any successor and assign (whether direct or indirect, by purchase,
merger, consolidation or otherwise of all or substantially all of its assets, to
expressly assume and agree to perform this Agreement in the same manner and to
the same extent that the Employer would be required to perform it if no such
succession had taken place or with or into which the Employer may consolidate or
merge. Employee agrees that this Agreement is personal to him and may not be
assigned by him otherwise than by will or laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Employee's
legal representatives; and this Agreement shall upon becoming effective
supersede the Employment Agreement dated July 1, 1982 as amended which shall be
cancelled and of no further force and effect.
14. MISCELLANEOUS
(a) If any provision of this Agreement, or portion
thereof, shall be held invalid or unenforceable by a court of competent
jurisdiction, such invalidity or unenforceability shall attach only to such
provision or portion thereof, and this Agreement shall be carried out as if any
such invalid or unenforceable provision or portion thereof were not contained
herein. In addition, any such invalid or unenforceable provision or portion
thereof shall be deemed, without further action on the part of the parties
hereto, modified, amended or limited to the extent necessary to render the same
valid and enforceable.
(b) This Agreement, and all of the rights and
obligations of the parties in connection with the employment relationship
established hereby shall be construed and enforced in accordance with the laws
of New Jersey applicable to contracts made and fully to be performed therein,
and without giving effect to any rules of conflicts of law.
(c) All notices, requests, demands, and other
communications provided for hereunder shall be in writing and shall be given or
made when (i) delivered personally; (ii) three (3) business days following
mailing by first class postage prepaid, registered or certified mail, return
receipt requested, to the party to be notified at its or his address set forth
herein; or (iii) on the date sent by telecopier, if the addressee has compatible
receiving equipment and provided the transmittal is made on a business day
during the hours of 9:00 a.m. to 6:00 p.m. of the receiving party and if sent at
other times, on the immediately succeeding business day, or (iv) on the first
business day immediately succeeding delivery to an express overnight carrier for
the next business day delivery.
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(d) This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. Each party shall
deliver such further instruments and take such further action as may be
reasonably requested by the other in order to carry out the provisions and
purposes of this Agreement. This Agreement represents the entire understanding
of the parties with reference to the subject matter hereof and neither this
Agreement nor any provisions thereof may be modified, discharged or terminated
except by an agreement in writing signed by the party against whom the
enforcement of any waiver, charge, discharge or termination is sought. Any
waiver by either party or a breach of any provision of this Agreement must be in
writing and no waiver of a particular breach shall operate as or be construed as
waiver of any subsequent breach thereof.
IN WITNESSETH WHEREOF, the parties hereto have executed and have caused
this Amended and Restated Employment Agreement to be executed as of the day and
year first above written.
PVC CONTAINER CORPORATION
By: /s/ Xxxx X. X'Xxxxxx
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Xxxx X. X'Xxxxxx
Executive Vice President and Secretary
/s/ Xxxxxxx X. Xxxxxxxx
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XXXXXXX X. XXXXXXXX
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