Exhibit 10.11.8
FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
Xxxxxxxx X. Xxxxx ("Executive") and Foamex International Inc., a
Delaware corporation (the "Company"), hereby enter into this First Amendment to
the Employment Agreement between Executive and the Company, dated as of January
1, 1999 (the "Employment Agreement").
WHEREAS, Executive serves as the Chairman of the Board of Directors of
the Company and Chairman of the Executive Committee of the Company; and
WHEREAS, Section 10 of the Employment Agreement provides that it may
be amended only by an instrument in writing approved by the Board of Directors
of the Company and signed by Executive and the Company; and
WHEREAS, the Company considers it in the best interests of its
stockholders to arrange for the provision of services by a key employee after
his retirement; and
WHEREAS, the Company wishes to amend the Employment Agreement to add
certain provisions approved by the Board of Directors of the Company at a
meeting held on June 29, 2001.
NOW THEREFORE, in consideration of the promises and mutual covenants
contained herein and in the Employment Agreement, it is agreed that the
Employment Agreement shall be amended effective June 29, 2001, unless otherwise
provided herein, as follows:
I.
A new Section 6A is added to the Employment Agreement which shall read
as follows:
SECTION 6A Post-Employment Services, etc.
(a) Consulting Services. If Executive retires from the Company at
anytime during the period commencing in the calendar year in which he attains
age sixty-eight (68) and ending on the last day of the calendar year in which he
attains age seventy-one (71), the Company and Executive hereby agree that
Executive shall serve as a consultant to the Company's senior officers and
shareholders and shall provide other consulting services as are mutually agreed
upon by the Company and Executive for the period commencing on the date
Executive retires and ending on the last day of the calendar year in which
Executive attains age seventy-one (71) (the "Consulting Term"). Upon reasonable
advance notice, Executive shall make himself reasonably available to provide
consulting services, up to a maximum of 20 hours per month, and shall perform
consulting services to the best of his ability; provided, however, that
Executive shall not
be required to render consulting services at any specified time or location.
Such consulting services shall be rendered as an independent contractor and not
as an employee of the Company.
(b) Consulting Fee. For each full week in the Consulting Term, the
Company shall pay Executive a fee of $6,135 (the "Consulting Fee"). The
Consulting Fee shall be payable in substantially equal bi-weekly installments.
The Company shall reimburse Executive for all reasonable expenses incurred by
him in the performance of his consulting services hereunder in accordance with
Section 5 of this Agreement.
(c) Other Benefits. Executive shall be entitled to the benefits
provided under the Split Dollar Life Insurance Agreement between Foamex
International Inc. and Xxxxxxxx X. Xxxxx (the "Split Dollar Agreement") attached
hereto as Exhibit A. In the event the Company terminates the Split Dollar
Agreement prior to Executive's death and Executive's employment or service with
the Company has not been terminated in accordance with either Section 6A(e)(i)
or 6A(e)(iii) hereof, the Company shall replace the benefits provided under the
Split Dollar Agreement with an arrangement that provides benefits to Executive
which are substantially similar in the aggregate to the benefits provided under
the Split Dollar Agreement.
(d) Office; Secretarial Support Services. During the Consulting Term,
Executive shall be entitled to (i) an office and (ii) secretarial support and
other services as needed.
(e) Termination.
(i) In the event Executive's employment is terminated by the
Company for Just Cause or by Executive without Good Reason, in each case prior
to attaining age sixty-eight (68), this Agreement shall terminate and Executive
shall not be entitled to the payments or benefits described in Sections 6A(b),
6A(c) and 6A(d) hereof.
(ii) In the event Executive's employment is terminated by the
Company without Just Cause or by Executive for Good Reason or on account of
Executive's death or Disability (as defined in Section 6(b)) at any time prior
to the last day of the calendar year in which Executive attains age seventy-one
(71), then, in addition to any other payments or benefits Executive or his
estate (as the case may be) is entitled to received under this Agreement
(including, but not limited to, the benefits described in Section 6A(c)),
Executive or his estate (as the case may be) shall be entitled to receive
payments in the amount of $6,135 for each full week in the period commencing on
the date Executive's employment is terminated and ending on the last day of the
calendar year in which Executive attains or would have attained age seventy-one
(71). Such payments shall be made in bi-weekly installments. Notwithstanding the
foregoing, in the event Executive's employment is terminated by the Company
without Just Cause or by Executive for Good Reason or on account of Executive's
death or Disability (as defined in Section 6(b)) at any time prior to the first
day of the calendar in which Executive attains or would have attained age
sixty-eight (68), Executive or his estate (as the case maybe) shall be entitled
to sum of the $956,991, payable ratably over
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the three (3) year period commencing on the first day of the calendar year in
which Executive attains or would have attained age six-eight (68). Such payments
shall be made in bi-weekly installments. Executive shall also be entitled to the
benefits provided under the Split Dollar Agreement as provided in Section 6A(c)
of this Agreement.
(iii) In the event Executive's consulting service is terminated
by the Company for "Cause" (as defined in Section 6A(e)(v)) or by Executive
without "Good Reason" (as defined in Section 6A(e)(vi)), Section 6A(b) of this
Agreement shall terminate, but Executive shall be entitled to receive any
earned, but unpaid, Consulting Fee as of the date of his service is terminated.
Executive shall also be reimbursed for business expenses incurred by Executive,
consistent with Section 6A(b), prior to such termination.
(iv) In the event Executive's consulting service is terminated by
the Company without "Cause" (as defined in Section 6A(e)(v)) or by Executive for
"Good Reason" (as defined in Section 6A(e)(vi)) or on account of Executive's
death or "Disability" (as defined ins Section 6A(e)(vii)), then, in addition to
any other payments or benefits Executive or his estate (as the case may be) is
entitled to received under this Agreement (including, but not limited to, the
benefits described in Section 6A(c)), Executive or his estate (as the case may
be) shall receive payments in the amount of $6,135 for each full week in the
period commencing on the date Executive's service is terminated and ending on
the last day of the calendar year in which Executive attains or would have
attained age seventy-one (71). Such payments will be made in bi-weekly
installments. Executive shall also be entitled to the benefits provided under
the Split Dollar Agreement as provided in Section 6A(c) of this Agreement.
(v) Solely for purposes of clauses (iii) and (iv) of Section
6A(e) hereof, the term "Cause" shall mean (a) Executive's conviction of a felony
or plea of nolo contendere to a felony charge, which conviction is
non-appealable or which the period for filing an appeal has expired, (b) any
material breach of the restrictive covenants set forth in Section 7 of this
Agreement, or (c) Executive's material willful breach of his duties under
Section 6A of this Agreement which is not cured within thirty (30) days of
written notice from the Board.
(vi) Solely for purposes of clauses (iii) and (iv) of Section
6A(e) hereof, the term "Good Reason" shall mean (a) the assignment to Executive
of any duties or responsibilities that are materially inconsistent with the
duties or responsibilities contemplated in Section 6A(a) of this Agreement, or
(b) any material failure by the Company to comply with any provision of Section
6A of this Agreement, other than a failure not occurring in bad faith and which
is remedied by the Company within thirty (30) days of written notice thereof
given by Executive, provided that repeated instances shall be evidence of bad
faith by the Company.
(vii) Solely for purposes of Section 6A(e)(iv) of this Agreement,
the term "Disability" shall mean Executive's inability to provide consulting
services to the Company during the Consulting Term on account of illness,
incapacity, or physical or
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mental disability for an aggregate of 120 days (whether or not consecutive) in
any 12-month period.
(f) Indemnification. The Company shall indemnify Executive and shall
hold him harmless from, and in respect of, all claims, actions, demands, costs,
expenses and fees that may arise out of, or in any way relate to, Executive's
performance of consulting services for the Company, and will promptly reimburse
Executive for all reasonable out-of-pocket expenses (including reasonable
attorneys' fees and expenses) incurred in connection with defending any such
claim. Notwithstanding the foregoing, the indemnity provided by this Section
6A(f) shall not extend to any act or omission which constitutes willful
misconduct, gross negligence or bad faith on the part of Executive.
(g) No Other Payments or Benefits. Notwithstanding any provision of
this Employment Agreement to the contrary and subject to Section 6A(e) hereof,
in the event Executive retires within the period prescribed in Section 6A(a)
hereof, he shall only be eligible to receive (i) the payments and benefits
described in Sections 6A(b), 6A(c), 6A(d) and 6A(f) hereof, provided he
satisfies the conditions for such payments or benefits, and (ii) any other
benefits he would otherwise be entitled to receive under the terms of any
employee benefit plan, program or arrangement sponsored or maintained by the
Company (including the Split Dollar Agreement) in which he participates on the
date of his retirement in accordance with the terms of such plan, program or
arrangement as in effect from time to time.
(h) Exclusivity. During the Consulting Term, Section 4 of the
Employment Agreement shall not apply.
II.
The first sentence of Section 7(b) shall be amended to read to read as
follows:
During the period commencing on the date of this Agreement and ending
the later of (i) the first anniversary of the termination of Executive's
employment pursuant to Section 6 hereof, or (ii) the first anniversary of the
expiration of the Consulting Term or if terminated sooner (such period is
hereinafter referred to as the "Restricted Period"), Executive shall not,
whether for his own account or for the account of any other individual,
partnership, firm, corporation or other business organization (other than the
Company), directly or indirectly solicit, endeavor to entice away from the
Company, its affiliates or subsidiaries, or otherwise directly interfere with
the relationship of the Company, its affiliates or subsidiaries with any person
who, to the knowledge of Executive, is employed or is otherwise engaged to
perform services for the Company, its affiliates and subsidiaries (including,
but not limited to, any independent sales representatives or organizations) or
who is, or was within the then most recent twelve-month period, a customer or
client of the Company, its predecessors or any of it subsidiaries or affiliates.
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III.
Except as otherwise set forth herein, the Employment Agreement shall
remain in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
31st day of December 2001.
FOAMEX INTERNATIONAL INC.
By:/s/ Xxxxx Xxx Xxxx
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Name: Xxxxx Xxx Xxxx
Title: Senior Vice President
/s/ Xxxxxxxx X. Xxxxx
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Xxxxxxxx X. Xxxxx, Executive
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