April 24, 1995
PRIVATE AND CONFIDENTIAL
Xx. Xxxxx Xxxxxx
0000 Xxxxxxxxx Xxxxx
Xxxxx, Xxxxx 00000
Re: Employment Agreement
Dear Xxxxx:
1. This letter confirms your employment by ELJER INDUSTRIES, INC. (the
"Company") as Controller-Manufacturing Operations. In that capacity, you
are entitled to the following:
a. A minimum annual salary of $97,400;
b. Benefits as described in, and in accordance with, the Company's
benefit plans; and
c. An annual par bonus equal to 25% of your annual salary. The amount
of bonus that you actually receive, if any, will depend on the
achievement of Corporate and your individual goals, and can range
from 0% to 50%.
2. During your employment with the Company, you will devote your full time
and energies to the faithful and diligent performance of the duties
inherent in, and implied by, your executive position.
3. In consideration of your continued employment with the Company, it is
mutually agreed that:
a. In the event your employment with the Company is terminated by the
Company during the term of this Agreement, for any reason other
than:
i. "Cause", as determined by the Compensation Committee of the
Board of Directors (for this purpose, "cause" shall mean: (a)
your willful and continued failure to substantially perform
your duties hereunder (other than any such failure resulting
from a "disability", as defined herein); or (b) your
conviction for committing an act of fraud, embezzlement,
theft, or other act constituting a felony; or (c) your willful
engagement in gross misconduct which is materially and
demonstrably injurious to the Company); or
ii. Inability, for reasons of "disability", reasonably to perform
your duties for six consecutive calendar months (for purposes
of this Agreement, "disability" shall mean a permanent and
total disability, within the meaning of Internal Revenue Code
Section 22(e)(3), as determined by the Compensation Committee
of the Board of Directors, in the exercise of good faith and
reasonable judgment, upon receipt of and in reliance on
sufficient competent medical advice from a qualified physician
selected by the Compensation Committee); or
Xx. Xxxxx Xxxxxx
Page -2-
April 24, 1995
b. In the event that during the term of this Agreement you resign your
position with the Company because:
i. You are assigned to a position of lesser rank or status; or
ii. Your annual salary, annual par bonus, level of participation
in management incentive plans, or your benefits are reduced;
or
iii. You are reassigned to a geographical area more than 50 miles
from your present residence;
the Company shall be required, and hereby agrees, to continue
paying your then salary, to pay a prorated portion of your then
annual bonus at par level, and to provide all pension, profit
sharing, deferred compensation, medical and life insurance benefits
under the Company's benefit plans, or the economic equivalent
thereof, for a period of 9 months from the date of such termination
or resignation. If, pursuant to the terms of a benefit plan, a
benefit would be earned or accrued during such 9-month period but
would be payable on a deferred basis (were you to be employed
during such 9-month period) the benefit similarly shall be deferred
hereunder; provided, however, that the Company reserves the right
to pay the present value of such benefit to you in cash at the end
of such 9-month period.
4. You are not required to mitigate the amount of any payments to be
made by the Company, pursuant to this Agreement, by seeking other
employment, or otherwise, nor shall the amount of any payments
provided for in this Agreement be reduced by any compensation
earned by you, as the result of self-employment or your employment
by another employer, after the date of termination of your
employment with the Company.
5. This Agreement will commence on April 24, 1995, and will continue
in effect until May 1, 1996, which shall be the "Expiration Date."
However, at the end of such period and, if extended, at the end of
each additional year thereafter, the term of this Agreement shall
be extended automatically for one additional year, unless the Vice
President-Human Resources delivers written notice three months
prior to the end of such term, or extended term, to you, that this
Agreement will not be extended. In such case, this Agreement will
terminate at the end of the term, or extended term, then in
progress.
The Company's obligation to pay severance benefits upon an
employment termination, within the two-year period following a
"change-in-control" shall be entirely governed by the terms of your
Executive Severance Agreement.
6. If a dispute arises regarding the termination of your employment or
the interpretation or enforcement of this Agreement, and you obtain
a final judgment, in your favor, from a court of competent
jurisdiction, from which no appeal may be taken, whether because
the time to do so has expired, or otherwise, or your claim is
settled by the Company prior to the rendering of such a judgment,
all reasonable legal and other professional fees and expenses
incurred by you in contesting or disputing any such termination, or
in seeking to obtain or enforce any right or benefit provided for
in this Agreement, or in otherwise pursuing your claim, will be
Xx. Xxxxx Xxxxxx
Page -3-
April 24, 1995
promptly paid by the Company, with interest thereon, at the highest
statutory rate of your state of domicile, for interest on judgments
against private parties, from the date of payment thereof by you to
the date of reimbursement to you by the Company.
Please acknowledge your acceptance of the terms and provisions of this Agreement
by signing in the space indicated below. We look forward to your contribution to
the success of ELJER INDUSTRIES, INC.
Sincerely, ACCEPTED AND AGREED as of
ELJER INDUSTRIES, INC. May 10, 1995
By: /s/ Xxxxx X. Xxxxxxxx /s/ Xxxxx Xxxxxx
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Xxxxx X. Xxxxxxxx Xxxxx Xxxxxx
Vice President-Finance & CFO
