1
EMPLOYMENT AGREEMENT
THIS AGREEMENT, made on the 18th day of August, 1999, and effective as
of the 1st day of June, 1999, by and between OUTLOOK GROUP CORP., a Wisconsin
corporation (hereinafter referred to as "Employer"), and Xxxxxx X. Xxxxxx
(hereinafter referred to as "Employee").
EMPLOYER AND EMPLOYEE AGREE, for the consideration of the mutual
promises and agreements hereinafter set forth, as follows:
1. EMPLOYMENT. Employer agrees to employ Employee as President and Chief
Operating Officer to perform the duties related to said positions, and
Employee hereby accepts and agrees to such employment. Employee shall
perform the duties as are customarily performed by one holding such
positions in a business such as Employer's. Employee shall also
unconditionally render other and related services and duties as
Employer may assign to him or ask of him from time to time. Employer
reserves the right to change from time to time the nature and scope of
Employee's duties and position.
2. COMPENSATION. Employer agrees to pay Employee during the term of this
Agreement, a compensation consisting of a salary, along with an
incentive earnings opportunity, also to be determined annually, as
provided in "Exhibit A," attached, which is a part of this Agreement.
All compensation shall be subject to the customary withholding tax and
other employment taxes as required with respect to compensation paid by
a corporation to an employee. Employee shall not be entitled to any
other compensation except as expressly provided for in this Agreement,
or as provided for by the Compensation Committee of the Board of
Directors.
3. SERVICES AND BEST EFFORTS OF EMPLOYEE. Employee agrees that he will at
all times faithfully, industriously, and to the best of his ability,
experience, and talent perform all the duties that may be required of
him pursuant to the express and implicit terms hereof, to the
reasonable satisfaction of Employer. Employee agrees to devote his
entire working time and attention to the performance of his duties for
the Employer, except for authorized vacation periods or periods of
illness.
The expenditure of reasonable amounts of time for personal business,
charitable, and professional business, charitable, and professional
activities shall not be deemed a breach of this Agreement provided such
activities do not materially interfere with the services to be rendered
for Employer hereunder.
4. TERM AND TERMINATION. The term of employment is for two (2) years,
beginning June 1, 1999, and is renewable June 1, 2001. However, the
agreement may be terminated
2
by either party, at any time, with or without cause or reason, upon
thirty (30) calendar days written notice being given to the other party
of such termination. In the event of Employer initiated termination for
any reason, other than dishonesty, fraud which has an adverse impact on
the Employer in excess of Ten Thousand Dollars ($10,000.00) in the
aggregate, or violation of paragraphs 8 or 9 of this agreement, the
Employee shall be entitled to receive his bi-weekly salary each two
weeks for a period of twenty-six (26) two-week periods following the
termination date. Also, employee will receive any bonus earned through
the last day of active employment.
In the event there is a change of control of the employer and one of
the below listed events occurs, said employee will then be entitled to
continue in the Corporate Benefit Programs as addressed in Point #7
plus receive his bi-weekly salary each two weeks for a period of
fifty-two (52) two-week periods following the date in which the below
listed event occurs. (Also, employee will receive any bonus earned
through the last day of active employment.)
Referred to events as mentioned above:
a. The employee is terminated by employer for reasons other
than dishonesty, fraud which has an adverse impact on the
employee of ten-thousand dollars ($10,000) in aggregate or
violation of paragraph 8 or 9 of this agreement.
b. Change in employment status as it relates to relocation,
authority or compensation and said employee terminates his
employment.
c. An employment agreement is not renewed within ninety (90)
days prior to the listed expiration date of this agreement
and said employee terminates his employment.
5. VACATION. Employee shall be entitled to the number of vacation days
authorized from time to time by Employer. If vacation is not taken, the
same shall not become cumulative, nor shall the Employee draw extra
compensation if he does not take his vacation. The time of Employee's
vacation shall be determined by the Employee, with provision for
on-going business responsibilities during his absence arranged by the
Employee.
6. EXPENSE REIMBURSEMENT. During the period of his employment, Employee
shall be reimbursed for all of his reasonable and necessary expenses
actually incurred in the performance of service and duties for
Employer, in accordance with the general policy of Employer, authorized
and adopted from time to time. Employee's expenses shall be recorded on
an itemized expense account.
2
3
7. EMPLOYEE BENEFITS. During the period of his employment, Employee shall
be entitled to participate in Employee benefit plans authorized and
adopted from time to time by Employer, and any other benefits
authorized by the Compensation Committee of the Board of Directors.
8. COVENANT NOT TO COMPETE. In connection with the employment of Employee
pursuant to this Agreement, Employee hereby agrees, acknowledges, and
recognizes that the following are important to Employer and that one or
more of the following are expected to be or become applicable to this
employment relationship: (a) on account of this employment, Employee
will acquire important business information about Employer including
but not limited to Employer's products and method of doing business,
which information if used, disclosed, or applied other than for
Employer's benefit can be expected to cause serious and substantial
damage to Employer; (b) Employee's service with Employer may result in
frequent contact with customers of Employer which may result in close
relationships and the association of Employer's good will with
Employee; (c) Employer's business information and customer
relationships are significant assets owned by Employer which are
developed by substantial investment of time and effort; Employer's
business information and the identity of Employer's customers are not
meant to be generally or specifically known by or disclosed to actual
or potential competitor(s) of Employer; (d) Employer has a legitimate
interest in protecting its business information and relationships; (e)
Employee's skills and knowledge of Employer's business information and
relationships are of a unique nature which will be further developed
and acquired during Employee's employment with Employer; and (f)
Employer has a legitimate interest in protecting its good will,
customer lists and relationships, products, method of doing business,
and other business information, by means of enforcement of this
Covenant Not to Compete set forth in this Paragraph.
Employee further acknowledges that in the course of his employment with
Employer, Employee is placed in a position of trust and confidence by
Employer with respect to Employer's methods of doing business and with
respect to Employer's customers. This Covenant Not to Compete is an
inducement to cause Employer to execute this Agreement and as a
condition and in consideration of such employment, and continued
employment, raises, promotions and/or other benefits to Employee by
Employer.
Employee covenants and agrees with Employer that at all times during
the term of his employment with Employer and for a period of six (6)
months after the termination of his employment with Employer for any
reason whatsoever, with or without cause, Employee shall not, either
directly or indirectly, engage in or participate in any capacity,
whether as an employee, independent contractor, owner, partner,
stockholder, officer, director, consultant, sole proprietor,
co-venturer, agent, or otherwise, with or without compensation, in or
with any business enterprises, of any kind, which is competitive with
the business in which the Employer was engaged at any time during the
one (1) year period immediately prior to termination of Employee's
employment with Employer.
3
4
Notwithstanding the foregoing, this Covenant Not to Compete is not
intended to prohibit the Employee from working for an employer having
multiple divisions, one or more of which divisions is engaged in a
business which is competitive with Employer's business, so long as the
Employee is not employed by or does not provide services to or perform
work for any competing division and so long as Employee does not
disclose confidential information to the other employer, or any of its
divisions, regarding any aspect of Employer's business.
This Covenant Not to Compete shall be limited to the geographical areas
within the field or area of Employer's activities during the course of
Employee's employment with Employer. This Covenant Not to Compete
applies to all competition occurring within the geographical area
specified, even though the headquarters or office of the competitor may
be outside of the area specified.
9. CONFIDENTIAL INFORMATION AND RECORDS. Employer is engaged or will
engage in a very competitive industry and marketplace. Employer expects
to accumulate substantial know-how and other information, at much
effort and cost, all of which is not generally known, relating to all
or some of the following: its existing and contemplated products,
services, procedures, methods of doing business, machinery and
equipment, compositions, technology, formulas, know-how, methods of
production and providing services, research and development programs
and plans, sales and marketing methods, existing and prospective
customers and suppliers, customer lists, customer usages and
requirements, financial matters, contractual and other agreements or
business relationships, and other confidential business information,
trade secrets and data (all hereinafter referred to as "Confidential
Information"). This Confidential Information is essential to the
well-being and success of Employer.
Employee acknowledges that his employment entails a position of trust,
and that employee has or will have access to Confidential Information.
Employee further acknowledges that such Confidential Information is
vital to the personal development, advancement, and economic security
of each person who looks to Employer as the principal means for
providing continuing opportunities for personal growth and promotion,
and that the acquisition of such Confidential Information by a
competitor of Employer would not only injure Employer, but would also
put Employer's personnel and their jobs in jeopardy.
For the above reasons, as an inducement to cause Employer to execute
this Agreement, and in further consideration of Employee's employment
and continued employment, raises, promotions, and/or other benefits
provided to Employee by Employer, Employee agrees as follows: (i)
except as required by Employee's duties to Employer, not to at any time
directly or indirectly disclose to or use for others or appropriate for
his own personal use or cause to be used by others any Confidential
Information without first obtaining the written consent of Employer to
do so; (ii) all records and other writings of Confidential
4
5
Information prepared by Employee, or which come into his possession or
control, or which he has access to, are and shall remain the exclusive
property of Employer, and upon termination of Employee's employment,
Employee will not remove any such records or copies thereof, but all
shall be left with Employer, and any such records or copies not with
Employer and in Employee's possession or control, shall be, upon
termination of employment, immediately returned to Employer along with
any other property of Employer.
The requirements of this Paragraph shall apply during the time of
Employee's employment with Employer and thereafter unless it can be
conclusively demonstrated that such Confidential Information (i) has
through no act or fault of Employee become part of the public domain,
or (ii) is no longer important or to be kept confidential for the
protection or well-being of Employer.
10. INJUNCTIVE RELIEF; EMPLOYEE'S ACKNOWLEDGMENT. Employee acknowledges
that any actual or threatened breach of (i) the Covenant Not to Compete
set forth herein or (ii) the provisions regarding Confidential
Information and records set forth herein, is likely to result in
immediate and irreparable harm to Employer. Employee also acknowledges
and admits that there may be no adequate remedy at law for his breach
or a threatened breach and therefore Employer shall be entitled to
immediate equitable relief by way of both temporary and permanent
injunctions, (including compensatory injunctions prohibiting Employee
from engaging in the restricted activity for the full period of the
agreed time plus the additional period of time equal to the term of any
violation of such restrictive covenant) and also money damages insofar
as can be determined under the circumstances, and such further relief
as any court with jurisdiction may deem just and proper.
Furthermore, Employee shall be responsible to pay to Employer all
Employer's actual and reasonable attorneys' fees and other legal costs
occasioned by and successful enforcement of this Agreement. Nothing
contained in this Agreement shall prevent Employer from availing itself
from any other right or remedy to which Employer is entitled under this
Agreement or otherwise, and the parties agree that all rights and
remedies available to Employer are cumulative including but not limited
to injunctive relief, money damages from Employee.
Employee further acknowledges that the restrictions (including as to
time and geography) contained in the provisions for the Covenant Not to
Compete and relating to the Confidential Information of Employer are
reasonable and are not now (and are not expected to be in the future)
onerous, harsh, or oppressive. Employee further acknowledges that these
restrictions do not, and are not expected to in the future, create or
result in a hardship to Employee in pursuit of a livelihood or in the
support of himself or his dependents, whether or not he is employed by
Employer. Employee further acknowledges that after termination of his
employment with Employer, he will be
5
6
reasonably able to earn a livelihood without violating this Covenant
Not to Compete and the provisions relating to Confidential Information.
Employee hereby agrees that the Covenant Not To Compete and the
provisions relating to Confidential Information of Employer shall
survive Employee's termination of employment with or without cause.
Employee agrees to notify any prospective employer of the existence of
this Agreement.
11. EMPLOYER'S AUTHORITY. Employee agrees to observe and comply with the
rules and regulations of Employer, as adopted, created, or implemented
from time to time by Employer's Board of Directors, respecting the
performance of his duties. Although Employee may be an officer or
director of Employer, he shall have no authority whatsoever to act
unilaterally on behalf of the Employer under this Agreement regarding
Employer's relationship with Employee.
12. PERSONAL CONTRACT. Employer is entering into this Agreement on account
of the skills and knowledge of Employee, and this Agreement is personal
as to Employee. Employee may not assign or delegate his rights and/or
duties under this Agreement. This Agreement shall automatically
terminate in the event that Employee is unable or unwilling to perform,
or does not perform, his duties of employment hereunder.
13. MISCELLANEOUS.
a. No waiver or modification of this Agreement or of any covenant,
condition, or limitation herein contained shall be valid unless in
writing and duly executed by all parties to this Agreement; and no
evidence of any waiver or modification shall be offered or
received in evidence in any proceeding, arbitration, or litigation
between the parties hereto arising out or affecting this
Agreement, or the rights or obligations of the parties hereunder,
unless such waiver or modification is in writing, duly executed as
aforesaid, and the parties further agree that the provisions of
this section may not be waived except as herein set forth.
b. The failure of Employer at any time to require performance by
Employee of any provision expressed herein shall in no way affect
or prejudice Employer's right thereafter to enforce such provision
or any other provision; nor shall the waiver by Employer of any
breach of any provision expressed herein be taken or held to be a
waiver of such provision itself.
c. All agreements and covenants contained herein are severable, and
in the event any of them shall be held to be invalid by any
competent court, this contract shall be interpreted as if such
invalid agreements or covenants were not contained herein.
d. The captions which are underlined at the beginning of the
paragraphs of this Agreement are chiefly for the purpose of
convenience and if the same be in conflict with the text, the text
shall control.
6
7
e. It is the intention of the parties hereto that this Agreement
shall be governed by its terms and construed in accordance with
and under and pursuant to the internal laws of the state of
Wisconsin.
f. As used in this Agreement, words in the singular may mean the
plural number and words used in the plural number may mean the
singular number; and words used in any gender may mean any other
gender.
g. This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors, assigns, heirs
and legal representatives subject to the paragraph above entitled
"Personal Contract."
h. All notices required under this Agreement shall be duly given if
delivered to the other party or mailed postage prepaid to the
respective party's last known address. Notices shall be effective
when personally delivered, or when sent by telegram, or by mail
when sent by certified, registered, or regular mail and deposited
in the United States mail, postage prepaid, and sent to the
respective address of the other party.
IN WITNESS WHEREOF, the parties have executed this Agreement
on the date first above written and by so executing, the parties acknowledge
that they have read and fully understand all the terms and conditions included
in this Agreement and acknowledge receipt of an executed copy of this Agreement.
Enclosure: Exhibit "A"
EMPLOYEE: OUTLOOK GROUP CORP.:
By:
---------------------------- -------------------------------
Xxxxxx X. Xxxxxx Xxxxxxx X. Xxxxxxx, Chairman
7
8
EXHIBIT "A"
TO EMPLOYMENT AGREEMENT BETWEEN
OUTLOOK GROUP CORP. AND
XXXXXX X. XXXXXX
EFFECTIVE JUNE 1, 1999
COMPENSATION
1. SALARY EFFECTIVE JUNE 1, 1999
Employer agrees to pay Employee bi-weekly salary, effective June 1,
1999, of $8,653.85 each two (2) weeks ($225,000 per year equivalent)
on its regular payroll. That salary will be in effect each of fiscal
2000 and fiscal 2001.
2. INCENTIVE EARNINGS OPPORTUNITY EFFECTIVE JUNE 1, 1999
EBIT Level Incentive
$0 to $2,500,000 None
$2,500,001 to above 5% of the amount over $2,500,000
This is a quarterly program that is annualized. Payments will be made
quarterly with the fourth quarter distribution subject to the year end
audit. Annual plan payment is maximized at 75% of participant's salary.
This incentive payment opportunity shall be in effect in each of fiscal
2000 and 2001.
3. CAR ALLOWANCE
Monthly reimbursement rate is set at $550, which includes all auto
related expenses including gas.
8
