Exhibit 10.13
EMPLOYMENT AGREEMENT
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THIS AGREEMENT is made effective as of the 25th day of March, 2009, by
and among CPG International Holdings LP ("CPG LP"), a Delaware limited
partnership, and its wholly owned subsidiaries, CPG International Inc., a
Delaware corporation ("CPG International"), CPG International I Inc., a
Delaware corporation ("CPG"), AZEK Building Products, Inc., a Delaware
corporation ("AZEK") and Scranton Products Inc., a Delaware corporation
("Employer," together with CPG LP, CPG International, CPG, AZEK, and
Scranton, the "Companies" and each individually a "Company"), and Xxxxxx X.
Xxxxxxx (the "Executive") (the "Agreement").
RECITALS
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WHEREAS, Employer desires to continue to employ the Executive and to
utilize his management services as indicated herein, and the Executive has
agreed to provide such management services to Employer;
WHEREAS, as a condition precedent and a material inducement for
Employer to continue to employ and pay the Executive, the Executive has
agreed to execute this Agreement and be bound by the provisions herein; and
WHEREAS, as a condition precedent and a material inducement for the
Companies to enter into this Agreement, the Executive has agreed to execute
the Noncompetition Agreement among the Companies and the Executive, dated
as of March [o], 2009 (the "Noncompetition Agreement"), and be bound by the
provisions therein.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the parties hereto agree as follows:
PROVISIONS
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1. Term and Duties. The Executive is currently employed as President
of Employer. Employer hereby agrees to continue to employ the Executive
until September 2, 2011 (the "Term"), unless terminated earlier in
accordance with Section 5 hereof. Subject to the provisions of this
Agreement, during the Term, the Executive shall devote his best efforts and
abilities to the performance of the Executive's duties on behalf of
Employer and to the promotion of its interests consistent with and subject
to the direction of Xxxx Xxxxxxxxx, the chief executive officer of
Employer, or his successor.
2. Exclusivity. The Executive shall devote all of his business time,
energies, attention and abilities to the operation of the business of
Employer and shall not be actively involved in any other trade or business
or as an employee of any other trade or business.
3. Compensation.
In consideration of the services to be rendered by the Executive
during the Term, Employer shall pay to the Executive $230,000 per year
("Base Compensation"), payable bi-weekly and prorated for any partial
employment period. The Executive shall also be eligible to participate in
the CPG International Inc. MIP plan beginning in calendar year 2009.
4. Benefits. During the Term, the Executive shall be eligible to
participate in such benefit programs offered by Employer as are offered to
similarly-situated employees of Employer (except in the case of
equity-based incentive plans where awards are subject to Board (or
committee thereof) approval), subject in each case to the generally
applicable terms and conditions of the plan, benefit or program in
question. For each calendar year beginning in 2009, the Executive shall be
entitled to three (3) weeks vacation.
5. Termination of Employment.
(a) If, during the Term, the Executive's employment is terminated
for any reason, the Employer shall be obligated to pay the Executive all
earned but unpaid Base Compensation, unpaid expense reimbursements and
accrued but unused vacation (the "Accrued Amounts"). If, during the Term,
the Executive's employment is terminated by the Employer other than for
Cause, Employer shall be obligated, in addition to the payment of the
Accrued Amounts, to continue to pay the Executive's Base Compensation at
the rate then in effect for a period of six (6) months following the
termination date (the "Termination Payments"). Employer's obligation to
make the Termination Payments shall be conditioned upon (i) the absence of
a breach by the Executive of the Noncompetition Agreement and (ii)
Executive's execution, delivery and non-revocation of a valid and
enforceable general release of claims in a form reasonably acceptable to
Employer (the "Release"). Subject to Section 5(b), the Termination Payment
shall be paid in installments on Employer's regular payroll dates occurring
during the six (6) month period immediately following the effectiveness of
the Release. The Accrued Amounts shall be paid within thirty (30) days
following the termination date.
(b) If the Executive is a "specified employee" for purposes of
Section 409A of the Internal Revenue Code of 1986, as amended, any payments
required to be made pursuant to this Section 5 which are subject to Section
409A shall not commence until six (6) months from the termination date,
with the first payment to be equal to the aggregate amount that would have
been paid to the Executive under this Section 5 during the first six (6)
months immediately following the termination date had this Section 5(b) not
been applicable.
(c) "Cause" as used herein shall mean the Executive's (i)
commission of an act which constitutes common law fraud, embezzlement
(other than occasional, customary and de minimis use of the Companies'
property for personal purposes) or a felony, an act of moral turpitude, or
of any tortious or unlawful act causing material harm to the Companies'
business, standing or reputation; (ii) gross negligence on the part of the
Executive in the performance of his duties hereunder; (iii) breach of his
duty of loyalty or care to any of the Companies; (iv) other misconduct that
is materially detrimental to any of the Companies; (v) ongoing refusal or
failure to perform the Executive's duties or the deliberate and consistent
refusal to conform to or follow any reasonable policy adopted by the Board,
in each case after receiving written notice describing his noncompliance
and being given a ten (10) business days opportunity to cure (to the extent
curable) such non-compliance; or (vi) material breach by the Executive of
this Agreement, the Noncompetition Agreement or any other agreement with or
for the benefit of any of the Companies to which the Executive is a party
or by which the Executive is bound, which material breach is not cured (to
the extent curable) within ten (10) business days following written notice
from Employer.
6. Consideration. The Executive acknowledges and agrees that the
consideration set forth in the recitals to this Agreement and the rights
and benefits hereunder are all and singularly valuable consideration which
are sufficient for any or all of the Executive's covenants set forth herein
and in the Noncompetition Agreement.
7. No Prior Agreements. The Executive represents and warrants that his
performance of all the terms of this Agreement does not and shall not
breach any fiduciary or other duty or any covenant, agreement or
understanding (including, without limitation, any agreement relating to any
proprietary information, knowledge or data acquired in confidence, trust or
otherwise) to which he is a party or by the terms of which he may be bound.
The Executive further covenants and agrees not to enter into any agreement
or understanding, either written or oral, in conflict with the provisions
of this Agreement.
8. Notices. All notices, requests, consents and demands by the parties
hereto shall be delivered by hand, by confirmed facsimile transmission, by
recognized national overnight courier service or by deposit in the United
States mail, postage prepaid, by registered or certified mail, return
receipt requested, addressed to the party to be notified at the addresses
set forth below:
if to the Executive:
Xxxxxx X. Xxxxxxx
000 Xxxxxx Xxxxx
Xxxxxx Xxxxxx, XX 00000
if to Employer:
c/o AEA Investors LLC
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: General Counsel
with copy to:
Fried, Frank, Harris, Xxxxxxx and Xxxxxxxx LLP
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxxxxx Xxxx, Esq.
Notices shall be effective immediately upon personal delivery or facsimile
transmission, one (1) business day after deposit with an overnight courier
service or three (3) business days after the date of mailing thereof. Other
notices shall be deemed given on the date of receipt. Any party hereto may
change the address specified herein by written notice to the other parties
hereto.
9. Entire Agreement. This Agreement cancels and supersedes any and all
prior agreements and understandings between the parties hereto with respect
to the obligations of the Executive, whether oral or written. This
Agreement and the Noncompetition Agreement constitute the entire agreement
between the parties with respect to the matters herein provided, and no
modifications or waiver of any provision hereof shall be effective unless
in writing and signed by the Companies and the Executive.
10. Binding Effect. All of the terms and provisions of this Agreement
shall be binding upon the parties hereto and its or his heirs, executors,
administrators, legal representatives, successors and assigns, and inure to
the benefit of and be enforceable by the Companies and their successors and
assigns, except that the duties and responsibilities of the Executive
hereunder are of a personal nature and shall not be assignable or delegable
in whole or in part.
11. Severability. In the event that any provision of this Agreement or
application thereof to anyone or under any circumstance is found to be
invalid or unenforceable in any jurisdiction to any extent for any reason,
such invalidity or unenforceability shall not affect any other provision or
application of this Agreement which can be given effect without the invalid
or unenforceable provision or application and shall not invalidate or
render unenforceable such provision or application in any other
jurisdiction.
12. Remedies; Waiver. No remedy conferred upon the Companies by this
Agreement is intended to be exclusive of any other remedy, and each and
every such remedy shall be cumulative and shall be in addition to any other
remedy given hereunder or now or hereafter existing at law or in equity. No
delay or omission by the Companies in exercising any right, remedy or power
hereunder or existing at law or in equity shall be construed as a waiver
thereof, and any such right, remedy or power may be exercised by the party
possessing the same from time to time and as often as may be deemed
expedient or necessary by such party in its sole discretion.
13. Counterparts. This Agreement may be executed in several
counterparts, each of which is an original and all of which shall
constitute one instrument. It shall not be necessary in making proof of
this Agreement or any counterpart hereof to produce or account for any of
the other counterparts.
14. Governing Law. The validity, interpretation, construction,
performance and enforcement of this Agreement shall be governed by the laws
of the State of New York, without application of conflict of laws
principles.
15. Headings. The captions and headings contained in this Agreement
are for convenience only and shall not be construed as a part of the
Agreement.
[signature pages follows]
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date and year first above written.
CPG INTERNATIONAL HOLDINGS LP CPG INTERNATIONAL INC.
By: CPG Holding I LLC By: /s/ Xxx Xxxxxxxx
Its General Partner ------------------------------
Name: Xxx Xxxxxxxx
By: /s/ Xxx Xxxxxxxx Title: Vice President
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Name: Xxx Xxxxxxxx
Title: Vice President
CPG INTERNATIONAL I INC. AZEK BUILDING PRODUCTS, INC.
By: /s/ Xxx Xxxxxxxx By: /s/ Xxx Xxxxxxxx
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Name: Xxx Xxxxxxxx Name: Xxx Xxxxxxxx
Title: Vice President Title: Vice President
SCRANTON PRODUCTS INC. EXECUTIVE
By: /s/ Xxxxxx X. Xxxxxxx /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx Xxxxxx X. Xxxxxxx
Title: President
