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EXHIBIT 10.11
CONSULTING AGREEMENT
THIS AGREEMENT ("Agreement"), made and entered into this ___ day
of January, 1997, by and between XXXXXX X. XXXX, an individual resident of the
State of Florida ("Consultant"); and ROCK-TENN COMPANY, a Georgia corporation
("Company");
W I T N E S S E T H:
WHEREAS, Consultant has significant experience in the paper and
packaging business in the United States and Canada;
WHEREAS, Company acknowledges that Consultant is engaged in other
business and personal activities that comprise his primary business activities;
and
WHEREAS, Company desires to engage Consultant as a consultant on
behalf of Company and its subsidiaries, including Waldorf Corporation
(collectively, the "Rock-Tenn Group"), and Consultant desires to be engaged by
Company on the terms and conditions set forth in this Agreement; and
NOW, THEREFORE, in consideration of the premises and the mutual
promises and agreements contained herein, the parties hereto, intending to be
legally bound, hereby agree as follows:
Section 1. Engagement.
Subject to the terms hereof, Company hereby engages Consultant as
a consultant, and Consultant hereby accepts such engagement. Throughout the term
hereof, Consultant shall provide consulting and advisory services to the
Rock-Tenn Group as Company shall reasonably request. The consulting and advisory
services provided by Consultant shall be rendered at such times and from such
locations as are mutually agreeable to Company and Consultant.
Section 2. Term of Engagement.
The engagement of Consultant hereunder shall commence as of the
date hereof and continue until the third anniversary of the date hereof. During
the Term of Engagement, Consultant will not be required by Company to provide
consulting services for more than 20 hours per month, or for more than such
hours per month as are mutually agreeable to Company and Consultant.
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Section 3. Consulting Fees; Expenses.
In consideration of the consulting services to be rendered by
Consultant under this Agreement, Consultant shall be paid a consulting fee of
Two Hundred Sixty-Four Thousand Dollars ($264,000) per year, which fee shall be
payable in equal monthly installments on or before the 15th day of each month
during the term hereof. Consultant shall also be reimbursed for any reasonable
business expenses incurred by him on behalf of, and at the request of, Company,
subject to Company's expense reimbursement policies and procedures in effect
from time to time.
Section 4. Consulting Payments.
Company and Consultant hereby acknowledge that the compensation
payable to Consultant hereunder has been fully negotiated and represents fair
consideration for the consulting services to be rendered by Consultant.
Consultant further acknowledges that he is aware of the federal and state income
tax consequences which are applicable to income received for consulting
services. Neither Consultant nor Company shall report the compensation received
by Consultant hereunder on any federal or state income tax return in any manner
other than as payment for consulting services, and neither Consultant nor
Company shall assert in connection with any claim for a refund for income taxes
paid, in connection with any administrative or judicial proceeding, or in
connection with any proposed or actual assessments of additional income taxes
that the compensation received by Consultant hereunder was paid by Company other
than in consideration for the consulting services which Consultant is to render
hereunder.
Section 5. Independent Contractor.
In rendering services hereunder, Consultant shall be acting as an
independent contractor. This Agreement is not an employment agreement and
Consultant is not and will not become by performance of services hereunder an
employee of Company. Contractor acknowledges that, as a consultant, he shall not
be entitled to any employee benefits, retirement benefits, stock option
benefits, health benefits, or other benefits which are customarily made
available to employees of Company.
Section 6. Partial Restrictive Covenants.
6.1 Definitions. For the purposes of this Agreement:
(a) "Company Activities" means the manufacture, distribution
and sale of paper and packaging products and other activities engaged in by the
Rock-Tenn Group for which Consultant provides consulting services hereunder;
(b) "Confidential Information" means any data or information of
the Rock- Tenn Group other than Trade Secrets, which is valuable to the
Rock-Tenn Group and not generally known to competitors, including, without
limitation, general business information,
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industry information, analysis and other information of a proprietary nature
that relates to the Rock-Tenn Group or was developed or compiled by the
Rock-Tenn Group;
(c) "Noncompetition Period" or "Nonsolicitation Period" means
the period beginning the date hereof and ending on the second anniversary of the
end of the term of engagement of Consultant under this Agreement;
(d) "Territory" means the United States of America (excluding
the states of Alaska and Hawaii) and the province of Ontario, Canada and all
provinces in Canada east of Ontario, such area being where customers and
actively sought prospective customers of the Rock-Tenn Group are located; and
(e) "Trade Secrets" means information of the Rock-Tenn Group,
without regard to form, including, but not limited to, technical or nontechnical
data, a formula, a pattern, a compilation, a program, a device, a method, a
technique, a drawing, a process, financial data, financial plans, product plans,
or a list of actual or potential customers or suppliers which is not commonly
known by or available to the public and which information: (1) derives economic
value, actual or potential, from not being generally known to, and not being
readily ascertainable by proper means by, other persons who can obtain economic
value from its disclosure or use; and (2) is the subject of efforts that are
reasonable under the circumstances to maintain its secrecy.
6.2 Trade Secrets and Confidential Information.
(a) Trade Secrets. Except in the course of providing consulting
services hereunder, Consultant will not use or disclose any Trade Secrets for so
long as the pertinent information remains Trade Secret information, regardless
of whether the Trade Secrets are in written or tangible form. Nothing in this
Agreement shall diminish the rights of Company or the Rock-Tenn Group regarding
the protection of Trade Secrets and other intellectual property pursuant to
applicable law.
(b) Confidential Information. Consultant agrees that during the
Noncompetition Period, Consultant will hold in confidence all Confidential
Information and will not will disclose, publish or make use of Confidential
Information except in the course of providing consulting services hereunder.
6.3 Noncompetition.
(a) Acknowledgment. Consultant acknowledges that the Rock-Tenn
Group conducts Company Activities throughout the Territory and that to
adequately protect the interests of Company in the business and goodwill of the
Rock-Tenn Group, it is essential that any noncompetition covenant with respect
thereto cover all Company Activities and the entire Territory for the duration
of the Noncompetition Period.
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(b) Trade Name. Consultant agrees that during the
Noncompetition Period, Consultant will not, directly or by assisting others,
own, manage, operate, join, control or participate in the ownership, management,
operation or control of any business conducted under any corporate, product or
trade name or trademark of, the Rock-Tenn Group, or name or xxxx similar
thereto, without the prior written consent of Company. Notwithstanding anything
in this Agreement to the contrary, Consultant may use the trade name "Wabash" in
any business or venture not engaged in Company Activities.
(c) Noncompetition Covenant. Consultant agrees that Consultant
will not, during the Noncompetition Period, directly or by assisting others,
conduct Company Activities in the Territory or otherwise engage in, have an
equity or profit interest in, or render services (of an executive, marketing,
manufacturing, research and development, administrative, financial or consulting
nature) to any business that conducts any of the Company Activities in the
Territory.
Notwithstanding anything in this Agreement to the contrary,
Consultant may acquire, collectively (directly or indirectly, through trusts or
otherwise), up to two percent (2%) of any company whose common stock is publicly
traded on a national securities exchange or in the over-the-counter market.
(d) Nonsolicitation. Consultant will not, during the
Nonsolicitation Period, directly or by assisting others, except in the course of
providing consulting services hereunder:
(i) solicit or attempt to solicit, any business from any of the
Rock-Tenn Group's customers, including actively sought prospective
customers, for purposes of providing products or services that are
competitive with those provided by the Rock-Tenn Group, or
(ii) recruit or solicit or attempt to recruit or solicit, on
Consultant's behalf or on behalf of any other person, firm or
corporation, any employee of the Rock-Tenn Group.
6.4 Severability. If a judicial or arbitral determination is
made that any of the provisions of this Agreement constitutes an unreasonable or
otherwise unenforceable restriction against Consultant, the provisions of this
Agreement shall be rendered void only to the extent that such judicial or
arbitral determination finds such provisions to be unreasonable or otherwise
unenforceable with respect to Consultant. In this regard, Consultant hereby
agrees that any judicial authority construing this Agreement shall be empowered
to sever any portion of the Territory, any prohibited business activity or any
time period from the coverage of this Agreement and to apply the provisions of
this Agreement to the remaining portion of the Territory, the remaining business
activities and the remaining time period not so severed by such judicial or
arbitral authority. Moreover, notwithstanding the fact that any provision of
this Agreement is determined not to be specifically enforceable, Company shall
nevertheless be entitled to recover monetary damages as a result of the breach
of such provision by Consultant.
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6.5 Injunctive Relief. Consultant hereby agrees that any remedy at law
for any breach of the provisions contained this Agreement shall be inadequate
and that Company shall be entitled to injunctive relief in addition to any other
remedy Company might have under this Agreement. Consultant agrees that any court
of competent jurisdiction should immediately enjoin any breach of this Agreement
upon the request of Company, and Consultant specifically releases Company from
the requirement of posting bond in connection with temporary or interlocutory
injunctive relief, to the extent permitted by law.
Section 7. Miscellaneous.
7.1 Binding Effect. This Agreement shall inure to the benefit
of and shall be binding upon Consultant and his executor, administrator, heirs,
personal representative and assigns, and Company and its successors and assigns;
provided, however, that Consultant shall not be entitled to assign or delegate
any of his rights or obligations hereunder without the prior written consent of
Company.
7.2 No Conflict or Breach. Consultant represents and warrants
that neither this Agreement nor the performance by Consultant of the consulting
services hereunder breaches any agreement to which Consultant is bound or
infringes upon the intellectual property rights, including trade secrets, of any
person.
7.3 Governing Law. This Agreement shall be deemed to be made
in, and in all respects shall be interpreted, construed and governed by and in
accordance with, the laws of the State of Minnesota.
7.4 Headings. The section and paragraph headings contained in
this Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement.
7.5 Notices. Unless otherwise agreed to in writing by the
parties hereto, all communications provided for hereunder shall be in writing
and shall be deemed to be given when delivered if delivered in person, on the
next business day if delivered by telecopy, or five business days after being
sent by first-class mail, registered or certified, return receipt requested,
with proper postage prepaid, and
(a) If to Consultant, addressed to:
Xx. Xxxxxx X. Xxxx
0000 Xxxx Xxxxx Xxxxxxxxx Xxxxx
Xxxx Xx. 0, Xxxxx
Xxxxxx, Xxxxxxx 00000
Telecopy No.: (000) 000-0000
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with a copy to:
Xx. Xxxxxx X. Xxxxxxx
Xxxxxxx, Street and Deinard
Suite 2300
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Telecopy No.: (000) 000-0000
(b) If to Company, addressed to:
Rock-Tenn Company
000 Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Chief Financial Officer
Telecopy No.: (000) 000-0000
with a copy to:
Rock-Tenn Company
000 Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: General Counsel
Telecopy No.: (000) 000-0000
or to such other person or address as shall be furnished in writing by any party
to the other prior to the giving of the applicable notice or communication.
7.7 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
7.8 Entire Agreement. This Agreement is intended by the parties
hereto to be the final expression of their agreement with respect to the subject
matter hereof and is the complete and exclusive statement of the terms thereof,
notwithstanding any representations, statements or agreements to the contrary
heretofore made. This Agreement may be modified only by a written instrument
signed by each of the parties hereto.
7.9 Dispute Resolution. Any dispute arising in connection with
this Agreement shall be resolved in the manner set forth in Section 13.12 of the
Stock Purchase Agreement dated the date hereof, by and among the Company,
Consultant and the other shareholders of Wabash Corporation, a Delaware
corporation, relating to the sale of the capital stock of Wabash Corporation.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
ROCK-TENN COMPANY
By: /s/ Xxxxxxx Xxxxxx, Xx.
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Xxxxxxx Xxxxxx, Xx.
Chief Executive Officer
CONSULTANT
/s/ Xxxxxx X. Xxxx
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Xxxxxx X. Xxxx
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