EXHIBIT 10.13
EMPLOYMENT AGREEMENT
--------------------
Agreement, made this 30th day of May, 1997, by and between PG NEWCO
CORP., a Delaware corporation with its principal offices located in
Chesterfield, Michigan (the "Company), a wholly owned subsidiary of Milwaukee
Land Company, a Delaware corporation ("MLC"), and Xxxxx X. XxxXxxxxxx, with his
residence located in Rochester Hills, Michigan ("VanHeusden").
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, the Board of Directors of the Company desires to employ
VanHeusden and VanHeusden desires to furnish services to the Company on the
terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements hereinafter contained, the parties hereby agree as
follows:
1. Employment. The Company shall employ VanHeusden, and VanHeusden
----------
shall serve the Company, upon the terms and conditions hereinafter set forth.
2. Term. The employment of VanHeusden by the Company hereunder,
----
unless sooner terminated on an earlier date in accordance with the provisions
hereinafter provided, shall terminate on May 30, 2002. The period ending on May
30, 2002, or such earlier or later date to which the
date in accordance with the provisions hereinafter provided, shall terminate on
May 30, 2002. The period ending on May 30, 2002, or such earlier or later date
to which the term of VanHeusden's employment hereunder may be shortened or
extended as provided in this Agreement is referred to herein as the "Employment
Term".
3. Duties. During the Employment Term, VanHeusden shall:
------
(a) Serve as President and Chief Executive Officer and a
director of the Company, faithfully and to the best of his ability,
subject to the direction and supervision of the Chairman of the Board
of the Company (the "Chairman of the Board") and the Board of
Directors of the Company (the "Board of Directors"); and
(b) Devote his full business time, energy and skill to such
employment and shall not, without the prior written approval of the
Board of Directors, directly or indirectly, engage or participate in,
or become employed by, or become a director, officer or partner of, or
render
2
advisory services to or provide other services in connection with, any
business activity other than that of the Company or any of its
subsidiaries or affiliates as provided above; provided, however, that
-------- -------
VanHeusden shall be permitted to personally invest in any publicly-
traded corporation, partnership or other entity, so long as any such
investment does not require or involve the active participation of
VanHeusden in the management of the business of any such corporation,
partnership or other entity, does not interfere with the execution of
VanHeusden's duties hereunder and does not otherwise violate any
provision of this Agreement.
4. Compensation. (a) During the term of this Agreement, the
------------
Company shall pay to VanHeusden a salary for his services (the "Base Salary") at
the rate of $225,000 per year, payable in accordance with the regular payroll
practices of the Company.
(b) Subject to the entry on or before March 31, 1998 of an order by
the Securities and Exchange Commission
3
("SEC") pursuant to section 8(f) of the Investment Company Act of 1940, as
amended (the "1940 Act") declaring that MLC has ceased to be an investment
company (the "Deregistration Order"), the Company will recommend to the
Compensation Committee that VanHeusden be granted, on the first business day
following the entry of a Deregistration Order, certain stock options ("Options")
and stock appreciation rights ("SARs") with respect to the common stock of MLC,
as more fully set forth below (the "Incentive Compensation"). The definitive
terms of the Options and SARs shall be set forth in a separate grant letter,
provided, however, that the Company will recommend to the Compensation Committee
-------- -------
that the Options shall entitle VanHeusden to purchase, after five years, up to
50,000 shares of MLC's common stock, $0.30 par value per share ("MLC Stock"), at
a price equal to the market price of such shares on the date of grant (the
"Strike Price"), and that the SARs shall entitle VanHeusden to receive, after
five years, an amount equal to the amount by which the market value of 25,000
shares of MLC Stock exceeds the aggregate Strike Price of such shares. The
Company's obligations under this paragraph 4(b) shall not
4
arise unless and until a Deregistration Order has been entered. If no such Order
has been entered at March 31, 1998, the Company shall have no obligation under
this paragraph 4(b).
(c) If the Deregistration Order has not been entered by the SEC on or
before March 31, 1998, the Company agrees to use its best efforts to obtain from
the SEC an order (the "Exemptive Order") granting to PG Newco and the Company an
exemption from Section 17(d) of the 1940 Act and Rule 17d-1 thereunder to permit
PG Newco and the Company to adopt a stock option plan that would permit the
Compensation Committee to grant to VanHeusden the Incentive Compensation
described in paragraph 4(b). Subject to (i) the entry of the Exemptive Order and
(ii) the approval by the stockholders of MLC of a stock option plan pursuant to
which the Incentive Compensation would be granted, and which stockholder
approval is given subsequent to the entry of the Exemptive Order, the Company
will recommend to the Compensation Committee that VanHeusden be granted on the
first business day following satisfaction of the conditions described in clauses
(i) and (ii) of this paragraph 4(c),
5
the Incentive Compensation having the terms described in paragraph 4(b).
5. Expenses. It is contemplated that, in connection with his
--------
employment hereunder, VanHeusden may be required to incur reasonable and
necessary travel, business entertainment and other business expenses. The
Company agrees to reimburse VanHeusden or pay for all reasonable and necessary
travel, business entertainment and other business expenses incurred or expended
by him incident to the performance of his duties hereunder, upon submission by
VanHeusden to the Company of vouchers or expense statements (i) satisfactorily
evidencing the incurrence of such expenses and (ii) that would enable the
Company to deduct such expenses from its income under applicable tax laws.
6. Employee Benefits, Vacation. (a) VanHeusden shall be fully vested
---------------------------
and entitled to participate in any and all life insurance, medical insurance,
disability insurance, pension, incentive and savings and other employee benefit
plans which are made available by the Company during the Employment Term to
executives of the Company of VanHeusden's
6
rank, to the extent that VanHeusden qualifies under the eligibility provisions
of such plans.
(b) VanHeusden shall be entitled to vacations (taken consecutively or
in segments), aggregating four (4) weeks each calendar year during the
Employment Term, to be taken at times consistent with the effective discharge of
VanHeusden's duties. Unused vacation time shall not accumulate from year to year
and, in the event any such unused vacation time is remaining at the end of the
year, VanHeusden shall not be entitled to be paid for any such remaining time.
(c) The Company agrees to use its best efforts to obtain and maintain
director and officer liability insurance for VanHeusden in connection with his
employment hereunder, in such amounts and on such terms as the Company may
obtain and maintain for its other directors and senior executives.
7. Car Allowance. During the Employment Term, the Company shall make
-------------
all scheduled lease payments on behalf of VanHeusden on the lease of
VanHeusden's current car (or its economic equivalent), as well as pay for all
regular insurance and maintenance charges on such vehicle,
7
and shall provide VanHeusden with a gasoline credit card to be used for business
purposes during the Employment Term.
8. Permanent Disability. In the event of the Permanent Disability
--------------------
(as defined below) of VanHeusden during the Employment Term, the Company shall
have the right, upon written notice to VanHeusden (the "Disability Notice"), to
terminate his employment hereunder, effective upon the giving of such Disability
Notice. Notwithstanding the foregoing, VanHeusden shall have the continuing
obligations provided for in Paragraph 11 hereof. Disability benefits, if any,
due under applicable plans and programs of the Company shall be determined under
the provisions of such plans and programs. For purposes of this Paragraph 8,
"Permanent Disability" shall have the meaning ascribed to such term in the
Company's disability plans and programs.
9. Death. In the event of the death of VanHeusden during the
-----
Employment Term, the Base Salary to which VanHeusden is entitled pursuant to
Paragraph 4 hereof shall continue to be paid through the date of death.
VanHeusden's designated beneficiary or personal representative, as the case may
be, shall accept the
8
payments provided for in this Paragraph 9 in full discharge and release of the
Company of and from any further obligations under this Agreement. Any other
benefits due under applicable plans and programs of the Company shall be
determined under the provisions of such plans and programs.
10. Termination.
-----------
(i) VanHeusden's employment hereunder may be terminated by the
Company for "cause" at any time if VanHeusden shall commit any of the following
Acts of Default:
(a) VanHeusden shall have failed to perform any of his
material obligations as set forth herein and shall have failed to
cure such failure within thirty (30) days after receiving written
notice thereof from the Chairman of the Board or the Board of
Directors; or
(b) The Company shall reasonably believe that VanHeusden
has committed an act of fraud, theft or dishonesty against the
Company, including, without limitation,
9
misappropriation of trade secrets or other assets of the Company
and its subsidiaries; or
(c) VanHeusden shall be convicted of (or plead nolo
----
contendere to) any felony or any misdemeanor involving moral
----------
turpitude or which might, in the reasonable opinion of the
Company, cause harm to the Company.
In the event the Company elects to terminate the employment of VanHeusden for
"cause" pursuant to this Paragraph 10(a), the Company shall send written notice
to VanHeusden (the "Termination Notice") terminating such employment and
describing the action of VanHeusden constituting the Act of Default, and
thereupon the Company shall have no further obligations under this Agreement,
but VanHeusden shall have the continuing obligations provided for in Paragraph
11 hereof.
(b) The Company may terminate VanHeusden's employment hereunder at
any time during the Employment Term for any reason other than "cause", as
defined in Paragraph
10
10(a) hereof, by giving VanHeusden written notice of such termination.
(c) If the Company terminates the employment of VanHeusden during the
term of this Agreement other than for "cause", then VanHeusden shall be entitled
to receive continuation of the Base Salary and the health benefits described in
Paragraph 6(a) hereof for the remainder of the Employment Term (the "Severance
Period"). All payments and benefits paid under this Paragraph 10(c) shall be
made in periodic installments in accordance with the Company's then-current
standard policies and practices. Appropriate and required withholding and
deductions for social security, federal and state and local income taxes,
together with any other deductions authorized by VanHeusden or required by law
or court order shall be made and will reduce any gross amounts to be paid under
this Agreement. VanHeusden shall accept the payments and benefits provided for
in this Paragraph 10(c) in full discharge and release of the Company of and from
any further obligations under this Agreement, but VanHeusden shall have the
continuing obligations provided for in Paragraph 11 hereof.
11
11. Restrictive Covenants and Confidentiality;
Injunctive Relief. VanHeusden agrees, as a condition to the
-----------------
performance by the Company of its obligations hereunder, that VanHeusden shall
abide in all respects by the terms of that certain Non-Competition Agreement
entered into by and between the Company and VanHeusden in connection with the
Asset Purchase Agreement, the terms of which Non-Competition Agreement are
ratified and incorporated herein by this reference.
12. Disclosure and Ownership of Inventions. VanHeusden shall fully
--------------------------------------
and promptly disclose in writing to the Company, or any persons designated by
it, all conceptions, discoveries, improvements, inventions (whether or not
patentable), formulas, ideas, processes, techniques, know-how, software, works
of authorship, designs, trademarks, service marks, logos, data and information
made, conceived, contemplated, reduced to practice or learned by VanHeusden,
whether alone or jointly with others, during the Employment Term (collectively,
the "Inventions"): (i) using, in any way, any equipment, supplies, facilities,
trade secrets or confidential or proprietary information of the Company; (ii)
during the performance of his duties for
12
the Company; or (iii) which either: (1) relates to the business of the Company,
or its actual or anticipated research and development; or (2) results from work
performed by VanHeusden for the Company. The Inventions shall be the sole
property of the Company and its successors and assigns, and VanHeusden agrees
that the Company and its successors and assigns shall be the sole owner of all
patents, copyrights, trademarks, trade secrets, mask works rights and other
rights in connection with such Inventions. VanHeusden hereby assigns to the
Company any rights that VanHeusden may have or acquire in such Inventions.
VanHeusden further agrees as to all such Inventions to assist the Company in
every proper way (but at the Company's expense) to obtain, and from time to time
enforce, patents, copyrights, trademarks, trade secrets and other rights in such
Inventions in any and all countries, and to that end VanHeusden will execute all
requisite and necessary documents for use in applying for and obtaining
protection for such Invention and enforcing the same, as the Company may desire,
together with any assignments thereof to the Company or persons designated by
it. VanHeusden's
13
obligation to assist the Company in obtaining and enforcing patents, copyrights
or other rights for such Inventions in any and all countries shall continue
beyond the Employment Term, but the Company shall compensate VanHeusden at a
reasonable rate after such termination for time actually spent by VanHeusden at
the Company's request of such assistance. In the event that the Company is
unable for any reason whatsoever to secure VanHeusden's signature to any lawful
and necessary document required to apply for or execute any patent, copyright,
trademark or other applications with respect to such Inventions (including
renewals, extensions, continuations, divisions or continuations in part
thereof), VanHeusden hereby irrevocably designates and appoints the Company and
its duly authorized officers and agents, as his agents and attorneys-in-fact to
act for and in his behalf and instead of VanHeusden, to execute and file any
such application and to do all other lawfully permitted acts to further the
prosecution and issuance of patents, copyrights, trademark or other rights
thereon with the same legal force and effect as if executed by VanHeusden.
14
13. Deductions and Withholding. VanHeusden agrees that the Company
--------------------------
shall withhold from any and all payments required to be made to VanHeusden
pursuant to this Agreement, all federal, state, local and/or other taxes which
the Company determines are required to be withheld in accordance with applicable
statutes and/or regulations from time to time in effect.
14. Medical Exams. VanHeusden agrees to cooperate fully with the
-------------
Company in its efforts to obtain "key man" insurance coverage with respect to
VanHeusden, and agrees to submit to any medical exams which may be necessary in
connection therewith.
15. No Conflicting Agreements. VanHeusden represents and warrants to
-------------------------
the Company that his engagement hereunder does not conflict with and will not be
constrained by any prior business relationship or agreement remaining in effect
and that he does not possess confidential information arising out of any prior
business relationship which would be utilized in connection with the performance
of his services hereunder.
15
16. Notices. All notices or other documents to be given hereunder by
-------
either party hereto to the other shall be in writing and delivered personally or
sent postage prepaid by registered or certified mail, return receipt requested.
Notices shall be deemed to have been received on the date of personal delivery,
or if sent by certified or registered mail, return receipt requested, shall be
deemed to be delivered on the third business day after the date of mailing. The
postal receipt specifying a mailing date shall be sufficient proof of the date
of notice. Notices shall be sent to the following addresses until a notice of
change of address by like notice has been duly provided:
To VanHeusden: Xxxxx X. XxxXxxxxxx
------------- 0000 Xxxxx Xxxxx
Xxxxxxxxx Xxxxx, Xxxxxxxx
00000
To the Company: PG Newco Corp.
-------------- c/o Milwaukee Land Company
000 Xxxx Xxxxxxx Xxxxxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxxxxx
Facsimile: (000) 000-0000
16
17. Assignability, Binding Effect and Survival. This Agreement shall
------------------------------------------
inure to the benefit of and shall be binding upon the heirs, executors,
administrators, successors and legal representatives of VanHeusden, and shall
inure to the benefit of and be binding upon the Company and its successors and
assigns. Notwithstanding the foregoing, the obligations of VanHeusden may not be
delegated and, except as expressly provided in Paragraph 9 hereof relating to
the designation of beneficiaries, VanHeusden may not assign, transfer, pledge,
encumber, hypothecate or otherwise dispose of this Agreement, or any of his
rights hereunder, and any such attempted delegation or disposition shall be null
and void and without effect. The provisions of Paragraphs 8, 9, 10 and 11 hereof
shall survive termination of this Agreement.
18. Complete Understanding; Amendment. This Agreement constitutes the
---------------------------------
complete understanding between the parties with respect to the employment of
VanHeusden hereunder, and supersedes all prior agreements, promises, covenants,
arrangements, communications, representations or warranties, whether oral or
written, by any officer,
17
employee or representative of any party hereto. This Agreement shall not be
altered, modified, amended or terminated except by written instrument signed by
each of the parties hereto. Waiver by either party hereto of any breach
hereunder by the other party shall not operate as a waiver of any other breach,
whether similar to or different from the breach waived.
19. Governing Law. This Agreement shall be governed by the laws of
-------------
the state of Michigan.
20. Paragraph Headings. The paragraph headings contained in this
------------------
Agreement are for reference purposes only and shall not effect in any way the
meaning or interpretation of this Agreement.
21. Severability. If any provision of this Agreement or the
------------
application of any such provision to any party or circumstances shall be
determined by any court of competent jurisdiction to be invalid and
unenforceable to any extent, the remainder of this Agreement or the application
of such provision to such person or circumstances other than those to which it
is so determined to be invalid and unenforceable, shall not be affected
18
thereby, and each provision hereof shall be validated and shall be enforced to
the fullest extent permitted by law.
19
IN WITNESS WHEREOF, the parties hereto set their hands as of the day
and year first above written.
PG Newco Corp.
By: /s/ Xxxxx Xxxxxxxx
----------------------------
Name: Xxxxx Xxxxxxxx
Title: Chairman of the Board
/s/ Xxxxx X. XxxXxxxxxx
-------------------------------
Xxxxx X. XxxXxxxxxx
20
