Exhibit 10.24
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), dated as of May 30, 1995, but
effective as of January 1, 1995, is by and between ONEIDA MOLDED PLASTICS
CORPORATION, a New York Corporation with its principal business offices at 000
Xxxxx Xxxxxx Xxxxxx, Xxxxxx, Xxx Xxxx 00000, ("Employer") and XXXXX X.
XXXXXXXXXX, 000 Xxxx Xxxxxx Xxxx, Xxxxxx, XX 00000, ("Employee"). The Employer
and the Employee are referred to collectively in this Agreement as the
"Parties".
1. Employment: Employer hereby employs the Employee, and Employee hereby accepts
employment from Employer, as President and Chief Executive Officer of Employer
upon the terms and conditions hereinafter set forth.
2. Term: The term of this Agreement shall begin as of January 1, 1995 and end on
December 31,1997, unless sooner terminated pursuant to Paragraph 8 here of.
3. Compensation:
3.1 Base Salary: Employer shall pay Employee an annual base salary as
follows, payable in equal installments no less frequently than monthly:
Calendar Year Amount
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1995 $225,000
1996 240,000
1997 255,000
3.2 Cash Bonus: Employee shall receive an annual cash bonus, if earned, in
respect of each fiscal year during the term of this Agreement based upon a
comparison of the actual EBIT for the fiscal year to the Budgeted EBIT for such
fiscal year, as approved by the Board of Directors. The terms, "Budgeted EBIT",
and "EBIT" are defined in Exhibit A hereto.
Employee's cash bonus, if any, shall be calculated according to the
following:
EBIT Bonus
If actual EBIT is greater than or equal to
80 percent of Budgeted EBIT and less than
100 percent of Budgeted EBIT 20 percent of base salary
If actual EBIT is greater than or equal to
100 percent of Budgeted EBIT and less than
110 percent of Budgeted EBIT 30 percent of base salary
If actual EBIT is greater than or equal to
110 percent of Budgeted EBIT and less than
120 percent of Budgeted EBIT 40 percent of base salary
If actual EBIT is greater than or equal to
120 percent of Budgeted EBIT 50 percent of base salary
Employee's cash bonus for any fiscal year shall be paid within 30 days
after Employer's independent auditors have delivered Employer's audited
financial statements for such fiscal year, but in no event later than one
hundred twenty (120) days following the end of the fiscal year.
If Employer's actual EBIT is less than 80 percent of Budgeted EBIT, a cash
bonus may be paid to Employee but solely at the discretion of the Board of
Directors.
4. Business Expenses: Employer shall pay or reimburse Employee for all
reasonable expenses that are incurred by Employee in furtherance of Employee's
duties including without limitation, travel, meals and hotel accommodations,
upon submission by Employee of vouchers or itemized lists thereof prepared as
may be required in order to permit such payments as proper deductions to
Employer under the Internal Revenue Code of 1986, as amended, and the rules and
regulation adopted pursuant thereto and in effect at that time.
5. Duties: Employee shall devote substantially his full business time to the
business of Employer and shall devote his best efforts in connection with his
employment by Employer. Employee shall serve as the Employer's President and
Chief Executive Officer and shall be responsible to the Board of Directors of
Employer.
In addition, if requested to do so, the Employee shall serve as an officer
and/or director of Rostone Corporation, a Delaware corporation ("Rostone"), at
no additional compensation. Rostone is an affiliated company of the Employer in
the following respect: the Employer is a wholly-owned subsidiary of Chatwins
Group, Inc. ("Chatwins"). Chatwins owns 49% of the outstanding capital stock of
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CGI Investment Corp. ("CGIIC") and has an option to purchase the remaining 51%
of such stock. CGIIC owns approximately 94% of the outstanding common stock and
100% of the outstanding preferred stock of Rostone. It is understood and agreed
that, for purposes of this Agreement, time spent by the Employee on Rostone's
business shall be deemed to be time spent in compliance with the first sentence
of this Paragraph 5.
6. Additional Benefits: Employee shall receive the following additional
benefits:
6.1 Holidays: Vacation: The Employee shall be entitled to such holidays as
are generally granted to employees of Employer. During the term of this
Agreement, Employee will be entitled to four weeks of vacation per year or such
other vacation time as may be agreed to by Employer and Employee.
6.2 Insurance: Employee and his spouse, if any, also shall be entitled to
receive such benefits under medical insurance plans, life and disability
insurance and otherwise, as are provided to all other executives of Employer.
6.3 Other Benefits: Employee shall be eligible for participation in any
other present or future pension, retirement, stock option, stock purchase,
insurance and other employee benefit plans (other than incentive compensation,
bonus, profit sharing and other similar plans), for which all other executive
employees of the Employer are generally eligible. It is understood that
entitlements which may accrue to Employee pursuant to such arrangements may
differ from those which accrue to other employees, such differences being based,
in the discretion of the plan administrators, upon differences in their
respective duties, responsibilities and performance.
6.4 Car Allowance: Employer shall pay a car allowance of $1,000 per month
for the rental of an automobile to be selected by Employee. In addition, the
Employer shall pay for or reimburse the Employee for gasoline and routine
maintenance for or on such automobile. The Employee shall be responsible for all
other costs and expenses relating to such automobile, including, without
limitation, insurance, taxes and major maintenance.
6.5 Split Dollar Policy: During the term of this Agreement, the Employer
shall provide a Split Dollar Term life insurance policy on the Employee's life
with a death benefit, in the amount of $2,000,000 in proceeds payable to
beneficiaries designated by Empioyee. Employer shall be designated as the owner
of this policy. If Employee's employment by Employer terminates for any reason
other than death, then upon the written request by Employee within 30 days of
such termination, any such life insurance policy existing pursuant to the
provisions of this paragraph shall be assigned to Employee provided that
Employee and the carrier each provide the Employer with reasonably satisfactory
releases from all obligations and liabilities pursuant to, and with respect to,
the policy. In addition, as a condition precedent to such assignment,
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Employee shall reimburse Employer for any amounts paid with respect to the
policy subsequent to termination of Employee's employment.
6.6 Deferred Compensation: The Employee shall be eligible to earn deferred
compensation at the rate of $3,333.33 per month during the term of this
Agreement in accordance with the terms of this Paragraph 6.6. The Employer shall
open and maintain an interest-bearing account (the "Deferred Compensation
Account") at a bank and shall deposit $3,333.33 per month in such account during
the term of this Agreement. The Deferred Compensation Account shall be separate
and distinct from all other of the Employer's accounts, and the funds therein
shall not be commingled with any other funds of the Employer or, until such
time, if any, as the Employee no longer has any right to receive any deferred
compensation hereunder, used by the Employer for any purpose other than to pay
the Employee deferred compensation, if earned, as provided herein.
Notwithstanding the foregoing, the Deferred Compensation Account shall at all
times remain subject to the claims of Employer's creditors. By no later than the
Required Payment Date (as defined below), the Employer shall pay over to the
Employee or, if applicable, his estate, all amounts (including interest) in the
Deferred Compensation Account unless prior to such date an Event of Forfeiture
(as defined below) has occurred. Any such payment shall be subject to the
Employer's compliance with applicable federal, state and local withholding
requirements. If an Event of Forfeiture occurs, then, in such case, (i) the
Employee shall not be entitled to receive payment of any amounts from the
Deferred Compensation Account or otherwise be entitled to any deferred
compensation under this Paragraph and (ii) the Employer shall be entitled to
retain and use for any purpose the funds in the Deferred Compensation Account.
As used herein, the following terms having the following meanings:
"Event of Forfeiture" means the termination of the Employee's employment
with the Employer pursuant to Paragraph 8.6 or 8.8 of this Agreement
"Required Payment Date" means the earlier to occur of (i) January 10, 1998
or (ii) a date which is thirty days after any termination of the Employee's
employment with the Employer for any reason other than pursuant to Paragraph 8.6
or 8.8 of this Agreement.
6.7 LTIP: The Employer shall establish a Long-Term Incentive Plan (the
"LTIP"). The Employee and, at the Employer's discretion, certain other employees
of the Employer and its subsidiaries shall be eligible to participate in the
LTIP. It is intended that the LTIP shall be generally similar in substance to
the long-term incentive plan maintained by Chatwins Group, Inc., the Employer's
parent company, with which plan the Employee is familiar. Within 60 days after
the end of each fiscal year of the Employer during the term hereof in respect of
which the actual EBIT equals or exceeds Budgeted EBIT for such year, the
Employer shall grant to the Employee that number of incentive units (such term
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to be defined in the LTIP) whose aggregate value (determined in accordance with
the provisions of the LTIP) then or as of the applicable valuation date is
$100,000. If this Agreement is not terminated prior to January 1, 1998, then, in
such case, on or before April 30, 1998 the Employer shall purchase all incentive
units then owned by the Employee at the value thereof calculated in accordance
with the terms of the LTIP. The purchase price thereof shall be payable in
accordance with the terms of the LTIP. In the case of termination of this
Agreement prior to January 1, 1998, the rights and obligations of the parties
with regard to the LTIP are set forth in Paragraph 9.
7. Non-Competition Covenant: Notwithstanding any other provision of this
Agreement, during the term of this Agreement and the first 12 months after the
termination of Employee's employment for any reason other than pursuant to
Paragraph 8.3, 8.4 or 8.5, Employee agrees that he will not directly or
indirectly engage in or have any interest in any person, firm, corporation or
business (whether as an employee, officer, director, agent, security holder,
creditor, consultant or otherwise) that engages in any activity in any state
which is competitive with the Employer. If, in any judicial proceedings, a court
shall refuse to enforce the covenant relating to that state, then the
unenforceable covenant relating to that state shall be deemed eliminated from
these provisions for the purpose of those proceedings to the extent necessary to
permit the remaining covenants with respect to other states to be enforced. If
Employee engages in activities in contravention of any provision of this
Paragraph 7, Employer's obligations to make monthly installments of the
additional pay pursuant to Paragraph 9 below shall cease. In addition, Employee
shall be subject to all other remedies available to Employer in law and equity,
including, but not limited to, specific performance and termination pursuant to
Paragraph 8.6. Notwithstanding anything contained herein to the contrary,
nothing shall be deemed to prohibit the Employee from owning less than 5% of the
securities of any entity the securities of which are traded on a national
securities exchange or are regularly quoted on the over-the-counter market.
8. Termination: This Agreement shall be terminated upon the happening of any
of the following events:
8.1 Whenever Employer and Employee shall mutually agree in writing to
terminate this Agreement.
8.2 By the death of the Employee.
8.3 By permanent disability of the Employee that renders him permanently
unable to perform his duties. Employee's disability shall be determined and
certified by a physician selected by Employee and acceptable to Employer.
8.4 By the Employer without cause upon thirty days' written notice of such
termination.
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8.5 By reason of the breach of Employer of any of the material terms of
this Agreement. In the event of a claim of any such breach, the procedures set
forth in Paragraph 8.6 (other than the first sentence) shall apply mutatis
mutandis.
8.6 By reason of the breach by the Employee of any of the material terms of
this Agreement, including without limitation, Employee's failure or refusal to
perform any duties reasonable required of Empioyee hereunder, any breach by
Empioyee of his legal duty of loyalty to the Employer, any breach by Employee of
his obligations under Paragraph 7 hereof and acts of dishonesty. Employer must
give Employee written notice of any breach under this Paragraph 8.6 specifying
the alleged acts which constitute the breach. Employee shall have 10 days to
respond in writing to respond in writing to such allegations. If the Employee
shall dispute the allegations, the issues shall be submitted promptly to a
single arbitrator appointed by the American Arbitration Association (the "AAA")
in Syracuse, New York, who shall decide the issue pursuant to AAA rules for
commercial arbitration. The arbitrator's decision as to whether a breach
justifying dismissal under this section has been committed shall be final and
binding. The party prevailing in the arbitration shall pay the costs thereof.
8.7 By reason of the written election of Employee during the 30-day period
following the Sale of the Employer to a person or entity other than (i) an
entity or person listed on Schedule B attached to and made a part of this
Agreement, or (ii) a person or entity who or which currently owns 15 percent or
more of the voting common stock of any entity listed on Exhibit B, or (iii) a
group of persons, entities or both currently controlled by, or controlling,
persons or entities described in clauses (i) or (ii) above. As used herein, the
term "Sale of the Employer" means the sale of all or substantially all of the
business and assets of the Employer or the saie of more than 50% of the voting
stock of the Employer or a merger or consolidation involving the Employer which
results in the shareholders (direct or indirect) of the Employer immediately
prior to the closing thereof owning less than 50% of the voting stock of the
surviving entity immediately after the closing thereof.
8.8 By the Employee without cause prior to January 1, 1998 upon thirty days
written notice of such termination.
9. Pavments on Termination: In addition to any other amounts due the Employee
pursuant hereto:
a) In the event that this Agreement is terminated pursuant to Paragraph
8.3, 8.4 or 8.5 or in the event of a Non-Renewal Termination (as defined below),
the Employee shall be entitled to:
i) Subject to Paragraph 10, additional pay in a sum equivalent to 24
months' salary (at the rate in effect on the date of termination). Such
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compensation shall be paid to the Employee (or to the Employee's estate or
designated beneficiary in the case of the Employee's death) in 24 equal monthly
instaliments commencing on the last day of the month following the date the
termination becomes effective, and continuing on the last day of each of the 23
subsequent months; and
ii) a portion of any cash bonus pursuant to Paragraph 3.2 hereof
and/or any LTIP benefit pursuant to Paragraph 6.7 hereof that would otherwise be
due the Employee had the Employee remained employed through the last day of the
year the Employee's employment terminated. The amount due the Employee pursuant
to this Paragraph shall be prorated based on the number of days in the year
prior to the date of termination and shall be paid in the same manner as set
forth in Paragraphs 3.2 and/or 6.7, as applicable.
As used herein, the term "Non-Renewal Termination" means the termination of
the Employee's employment on January 1, 1998 if prior thereto the Employer has
not offered to continue such employment for a period of not less than two years
at a salary of not less than $265,000 per year and with benefits comparable to
those provided for in Paragraphs 6.1, 6.2, 6.3, 6.4 and 6.5.
b) Upon termination of this Agreement pursuant to the provisions of
Paragraph 8.2, 8.6 or 8.8, all salary and other obligations of Employer to
Employee under this Agreement, shall cease as of the date of termination, except
to the extent otherwise required by applicable law.
c) Upon termination of this Agreement pursuant to Paragraph 8.7, the
Employee shall be entitled to the following:
i) Subject to Paragraph 10, the Employer shall continue the Employee's
salary for a period of 36 months following the date of termination of employment
at the rate in effect on such date.
ii) The Employer shall continue coverage of the Employee and his
spouse in the Employer's group health insurance plan (at no cost to the
Employee) for a period ending on the earlier to occur of (A) the date, if any,
on which the Employer ceases to maintain a group health insurance plan for its
employees generally or (B) the third anniversary of the date of termination of
employment; provided that the Employee and his spouse continue to be insurable
and eligible for inclusion in such group plan under the terms of the applicable
insurance policy and the rules and requirements of the insurance company.
iii) The Employer shall purchase all incentive units then owned by the
Employee under the LTIP for a price equal to the greater of (A) $1,000,000 or
(B) their value as calculated in accordance with the terms of the LTIP. Such
purchase price shall be payable in accordance with the terms of the LTIP.
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10. The obligation of the Employer to make salary continuation or other
payments pursuant to Paragraph 9 (a)(i) or 9 (c)(i) shall be reduced dollar-
for-dollar by (A) any salary or other compensation earned by the Employee
(whether or not paid) as an employee, consultant or otherwise through the
rendering of services to others prior to the end of such salary continuation or
other payment period and (B) any disability insurance payments paid or payable
to the Employee during or for such period under any disability insurance
coverage for which the Employer paid the premiums (excluding Tuff Tie
Corporation).
11. Annual Physical: During the term of this Agreement, the Employer shall pay
for an annual physical examination for the Employee to be performed by a doctor
or medical facility selected by the Employee and approved by the Employer.
12. Notices: For the purposes of this Agreement, notices and demands shall be
deemed given (i) at the time they are delivered personally, or (ii) three days
after they are deposited in the United States mail, as certified mail or
registered maii, return receipt requested, postage prepaid, provided that such
delivery occurs personally or at the following address: in the case of Employer:
000 Xxxxx Xxxxxx Xxxxxx, Xxxxxx, Xxx Xxxx 00000, with a copy to Xx. Xxxxxxx X.
Xxxxxxx (for so long as he is director of the Employer), c/o Stanwich Partners,
Inc., One Stamford Landing, 00 Xxxxxxxxxx Xxxxxx, Xxxxxxxx, XX 00000; In the
case of the Employee: 000 Xxxx Xxxxxx Xxxx, Xxxxxx, Xxx Xxxx 00000. Either party
may change address by giving the other party notice of such change in the
aforementioned manner, except that notice of change of address shall only be
effective upon receipt. A delivery shall be deemed to occur personally and
follows: In the case of the Employee, when handed to the Employee, and in the
case of the Employer, when handed to a member of the Board of Directors of
Employer.
13. Board of Directors Position: The Board of Directors of Employer will
undertake its best efforts to cause Employee to be elected and remain as a
director of the Employer and of all direct and indirect subsidiaries of the
Employer. The Employee shall not be entitled to any additional compensation for
serving as a director of the Employer or its subsidiaries.
14. Miscellaneous:
14.1 No provision of this Agreement may be modified, waived or discharged
unless such modification, waiver or discharge is agreed to in writing signed by
Employee and on behalf of Employer by an officer other than Employee
specifically designated by the Board of Directors of Employer.
14.2 No waiver by either party hereto at any time of any breach by the
other party or of compliance of any condition or provision of this Agreement to
be performed by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or at any prior or subsequent
time.
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14.3 The validity, interpretation and construction of this Agreement shall
be governed by the laws of the State of New York.
14.4 The headings for the paragraphs of this agreement are inserted for
convenience only, and shall not constitute a part hereof.
14.5 The terms and conditions of this Agreement shall insure solely to the
benefit of and be binding upon the heirs and the respective successors and
assigns of the parties hereto. There are no third party beneficiaries of this
Agreement.
14.6 This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, and all of which taken together shall
constitute one and the same instrument.
14.7 This Agreement (i) constitutes the entire understanding of the parties
with respect to the subject matter hereof and (ii) supersedes and replaces all
prior agreements, whether oral or in writing, with respect to such subject
matter.
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EMPLOYER:
ONEIDA MOLDED PLASTICS CORPORATION
A New York Corporation
By: /s/ XXXXXXX X. XXXXXXX
------------------------------
Name: Xxxxxxx X. Xxxxxxx
-----------------------------
Title: Director
----------------------------
EMPLOYEE:
/s/ XXXXX X. XXXXXXXXXX
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Xxxxx X. Xxxxxxxxxx
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EXHIBIT A
(Attached to and Made a Part of The Employment Agreement Dated as of April
1995 Between Oneida Molded Plastics Corporation and Xxxxx X. Xxxxxxxxxx)
For purposes of paragraph 3.2 of the Employment Agreement, the following
definitions shall apply.
1. "EBIT" means, with regards to any fiscal year, the consolidated earnings of
the Company and Rostone Corporation before interest and taxes for such fiscal
year determined in accordance with GAAP as set forth in the audited financial
statements of the Company and Rostone Corporation.
2. "Company" means Oneida Molded Plastics Corporation ("OMPC") and each direct
and indirect Subsidiary of OMPC.
3. "Subsidiary" means a corporation 80% or more of whose voting stock is owned
by OMPC.
4. "Budgeted EBIT" means (i) $2,181,400 (OMP) and $2,719,000 (Rostone) for the
fiscal year ended December 31, 1995 and (ii) such amounts as are specified as
such by OMPC's Board of Directors for the fiscal year ending December 31,
1996 and 1997.
5. "GAAP" means generally accepted accounting principals as in effect from time
to time.
EXHIBIT B
(Attached to and Made a Part of The Employment Agreement Dated as of April 1995
Between Oneida Molded Plastics Corporation and Xxxxx X. Xxxxxxxxxx)
Texon Energy Corporation
Sanitas, Inc.
XxXxxxx-Xxxxxxx, Inc.
Stanwich Partners, Inc.
Rostone Corporation
Consumer Portfolio Services, Inc.
Xxxxxxx X. Xxxxxxx
Xxxx X. Xxxxx
Reunion Resource Company
