Exhibit (10)(a)
EXECUTION COPY
AMENDMENT TO
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
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THIS IS AN AMENDMENT TO AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the
"Amendment Agreement"), dated as of April 30, 2002 (the "Effective Date"),
between West Pharmaceutical Services, Inc., a Pennsylvania corporation, (the
"Company") and Xxxxxxx X. Xxxxxx (the "Employee").
Background
The Company and the Employee are parties to an Amended and Restated
Employment Agreement, dated as of March 25, 2000 (the "Employment Agreement"),
which provides, among other things, for the employment of the Employee as the
Company's Chief Executive Officer and compensation and benefits to be paid to
him.
The Employee has informed the Board of Directors of the Company of his
intention to retire from the Company and has agreed to step down as Chief
Executive Officer as of the Effective Date. In light of these actions, the Board
of Directors and its Compensation Committee and the Employee have agreed to
modify certain terms and conditions of the Employment Agreement, all as set
forth in this Amendment Agreement.
Agreement
Intending to be legally bound, the parties agree as follows:
1. Term of Employment. The Employee's employment with the Company, and
the Company's obligations under the Employment Agreement, shall
terminate on March 31, 2003 (the "Termination Date"), unless sooner
terminated as provided in Sections 6 or 7 of the Employment Agreement.
For purposes of the Employment Agreement, this Amendment Agreement,
the West Pharmaceutical Services, Inc. Employees' Retirement Plan, as
amended and restated effective January 1, 2001, and any successor plan
thereto (the "Retirement Plan") and the Supplemental Executive
Retirement Plan and any successor plan thereto (the "SERP") shall be
deemed to have retired under the Retirement Plan on and as of the
Termination Date.
2. Position and Site of Employment.
(a) From the Effective Date through the Termination Date, the
Employee will serve as Chairman of the Board of the Company. The
Employee will have the duties and responsibilities outlined in
Exhibit "A" to this Amendment Agreement, which is attached hereto
and made a part hereof. The Employee consents to the duties and
other terms of employment outlined in this Amendment Agreement
and agrees that such duties and responsibilities do not
constitute a "Constructive Termination" of his employment as such
term is defined in the Employment Agreement.
(b) During the period from the Effective Date through the Termination
Date, the Company shall pay for an offsite office with shared
administrative support, that is reasonably acceptable to the
Employee, and the Employee shall continue his duties and
responsibilities under this Amendment Agreement from that office.
3. Compensation and Benefits. The Employee's shall receive a base salary
at the rate of $575,000 per annum through the Termination Date and
remain eligible to receive a bonus for 2002 under the Management
Annual Incentive Bonus Program, as and to the extent paid under that
plan in accordance with the plan terms. His target bonus level shall
be at 75% of base salary.
4. Golf Club Membership. The Company will permit the Employee to retain
his equity interest in Metedeconk National Golf Club, Inc. and related
membership privileges until the Termination Date. The Executive may be
permitted to continue to retain such membership following the
Termination Date at the discretion of the Company's Chairman,
Independent Directors.
5. Other Amendments to the Employment Agreement.
(a) The reference to "Section 11" in Section 16.6 of the Employment
Agreement is hereby amended to read "Section 13".
(b) Section 10 of the Employment Agreement is hereby deleted in its
entirety and Sections 11 through 16 (and any references thereto)
are re-numbered accordingly.
(c) Clause (vi) of Section 6.1 is deleted in its entirety and
replaced with the following:
"(vi) the Employee's breach of his undertakings under
Section 9 hereof or that certain Non-Competition Agreement
dated as of April 30, 2002 between him and the Company."
(d) Section 11 of the Employment Agreement is amended in the
following respects:
i. In the first sentence is amended by deleting the "s" from
the word Section and by deleting the words "and 10.2"
therefrom;
ii. The second sentence is amended by deleting the words "and
10" therefrom; and
iii. The last sentence thereof is deleted in its entirety
6. General.
(a) Governing Law. This Amendment Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the
Commonwealth of Pennsylvania, without giving effect to conflicts
of laws principles thereof which might refer such interpretations
to the laws of a different state or jurisdiction.
(b) Captions. The section headings contained herein are for reference
purposes only and shall not in any way affect the meaning or
interpretation of this Amendment Agreement.
(c) Effect of Agreement. Except as otherwise set forth in this
Amendment Agreement, the Employment Agreement shall remain in
full force and effect in accordance with its terms.
(d) Entire Agreement. This Amendment Agreement and Exhibit "A" hereto
set forth the entire agreement and understanding of the parties
relating to the subject matter hereof, and supersede all prior
agreements, arrangements and understandings, written or oral,
between the parties.
(e) No Other Representations. No representation, promise or
inducement has been made by either party hereto that is not set
forth in this Amendment Agreement, and no party shall be bound by
or liable for any alleged representation, promise or inducement
not so set forth.
(f) Successors and Assigns. This Amendment Agreement shall inure to
the benefit of and shall be binding upon the Company and the
Employee and, subject to the provisions of Section 13 of the
Employment Agreement, their respective heirs, executors, personal
representatives, successors and assigns.
(g) Amendments; Waivers.
i. This Amendment Agreement may not be amended, modified,
superseded, canceled, renewed or extended, and the terms or
covenants hereof may not be waived, except by a written
instrument executed by the parties to this Amendment
Agreement or in the case of a waiver, by the party waiving
compliance.
ii. The failure of any party to require performance of any
provision of, or to exercise any right under, this Amendment
Agreement shall not affect the right of that party at a
later time to enforce that provision or exercise that right.
iii. No waiver of any term of this Amendment Agreement, whether
by conduct or otherwise, will be deemed to be, or construed
as, a further or continuing waiver of that or any other
breach.
(h Counterparts. This Amendment Agreement may be executed in one or
more counterparts, which together shall constitute a single
agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment
Agreement as of the date first set forth above.
WEST PHARMACEUTICAL SERVICES, INC.
By: /s/ J. R. Xxxxxx
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Xxxx X. Xxxxxx III, Vice President
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
Exhibit A
CHAIRMAN'S RESPONSIBILITIES
May 2002 to March 2003
A. To be responsible for the management of West's Board of Directors
B. To use his best efforts to transition his prior responsibilities to the new
CEO, giving particular emphasis to the following:
1. Developing a new investor relations program
2. Developing a new three-year business plan
3. Reviewing major capital spending
4. Reviewing initiatives to improve cash flow and to strengthen the
Company's balance sheet
5. Facilitating a transfer of relationships between West and Daikyo
(Japanese joint venture partner)
6. Developing major presentations
7. Identifying future merchant banking relationships
8. Assisting as needed with divestitures, acquisitions and customer visits
9. Being available to accept ad hoc assignments from the Board
10. Identifying two new candidates for West's Board of Directors
11. Developing new succession plan
It is clearly understood that all items listed under "B" are now the
responsibility of management and that the Chairman's role is to
provide guidance.
