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Exhibit 10.1
EMPLOYMENT AGREEMENT
THIS AGREEMENT, is made as of this 15th day of March, 1999, by and
between BOWATER INCORPORATED, a Delaware corporation having a mailing address of
00 Xxxx Xxxxxxxxxx Xxx, Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000 (the "Corporation"),
and Xxxxx X. Xxxxxx, 000 XxXxxx Xxxxxx, Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000 (the
"Executive").
WHEREAS, the Corporation desires to employ the Executive as Vice
President - Human Resources; and
WHEREAS, the Executive is desirous of serving the Corporation in such
capacity;
NOW, THEREFORE, the parties hereto agree as follows:
1. Employment. During the term of this Agreement the Corporation agrees
to continue to employ the Executive, and the Executive agrees to continue in the
employ of the Corporation, in accordance with and subject to the provisions of
this Agreement.
2. Term.
(a) Subject to the provisions of subparagraphs (b) and
(c) of this Section 2, the term of this Agreement
shall begin on the Date hereof and shall continue
thereafter until terminated by either party by
written notice given to the other party at least
thirty (30) days prior to the effective date of any
such termination. The effective date of the
termination shall be the date stated in such notice,
provided that if the Corporation specifies an
effective date that is more than thirty (30) days
following the date of such notice, the Executive may,
upon thirty (30) days' written notice to the
Corporation, accelerate the effective date of such
termination.
(b) Notwithstanding Section 2(a), upon the occurrence of
a Change in Control as defined in the Change in
Control Agreement of even date herewith between the
Corporation and the Executive (the "Change in Control
Agreement"), the term of this Agreement shall be
deemed to continue until terminated, but in any
event, for a period of not less than three (3) years
following the date of the Change in Control, unless
such termination shall be at the Executive's election
for other than "Good Reason" as that term is defined
in the Change in Control Agreement.
(c) Notwithstanding Section 2(a), the term of this
Agreement shall end upon:
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(i) the death of the Executive;
(ii) the inability of the Executive to perform
his duties properly, whether by reason of
ill-health, accident or other cause, for a
period of one hundred and eighty (180)
consecutive days or for periods totaling one
hundred and eighty (180) days occurring
within any twelve (12) consecutive calendar
months; or
(iii) the Executive's retirement on his early or
normal retirement date.
3. Position and Duties. Throughout the term hereof, the Executive shall
be employed as Vice President - Human Resources of Bowater Incorporated (Salary
Grade 34), with the duties and responsibilities customarily attendant to that
office, provided that the Executive shall undertake such other and further
assignments and responsibilities of at least comparable status as the Board of
Directors may direct. The Executive shall diligently and faithfully devote his
full working time and best efforts to the performance of the services under this
Agreement and to the furtherance of the best interests of the Corporation.
4. Place of Employment. The Executive will be employed at the
Corporation's offices in the City of Greenville, South Carolina or at such other
place as the Corporation shall designate from time to time, provided, however,
that if the Executive is transferred to another place of employment,
necessitating a change in his residence, the Executive shall be entitled to
financial assistance in accordance with the terms of the Corporation's
relocation policy then in effect.
5. Compensation and Benefits.
(a) Base Salary. The Corporation shall pay to the
Executive a base salary of $235,000 payable in
substantially equal periodic installments on the
Corporation's regular payroll dates. The Executive's
base salary shall be reviewed at least annually and
from time to time may be increased (or reduced, if
such reduction is effected pursuant to
across-the-board salary reductions similarly
affecting all management personnel of the
Corporation).
(b) Bonus Plan. In addition to his base salary, the
Executive shall be entitled to receive an annual
bonus under the Corporation's bonus plan in effect
from time to time determined in the manner, at the
time, and in the amounts set forth under such plan.
For 1999, the Executive will be entitled to a 45%
target bonus formula. Any bonus for such year will be
prorated to the nearest full month of active
employment.
(c) Benefit Plans. The Corporation shall make
contributions on the Executive's behalf to the
various benefit plans and programs of the
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Corporation in which the Executive is eligible to
participate in accordance with the provisions thereof
as in effect from time to time.
(d) Vacations. The Executive shall be entitled to five
weeks of annual paid vacation, in keeping with the
Corporate policy as in effect from time to time, to
be taken at such time or times as may be approved by
the Corporation.
(e) Expenses. The Corporation shall reimburse the
Executive for all reasonable expenses properly
incurred, and appropriately documented, by the
Executive in connection with the business of the
Corporation.
(f) Perquisites. The Corporation shall make available to
the Executive all perquisites to which he is entitled
by virtue of his position.
6. Nondisclosure. During and after the term of this Agreement, the
Executive shall not, without the written consent of the Board of Directors of
the Corporation, disclose or use directly or indirectly, (except in the course
of employment hereunder and in furtherance of the business of the Corporation or
any of its subsidiaries and affiliates) any of the trade secrets or other
confidential information or proprietary data of the Corporation or its
subsidiaries or affiliates; provided, however, that confidential information
shall not include any information known generally to the public (other than as a
result of unauthorized disclosure by the Executive) or any information of a type
not otherwise considered confidential by persons engaged in the same or similar
businesses.
7. Noncompetition. During the term of this Agreement, and for a period
of one (1) year after the date the Executive's employment terminates, the
Executive shall not, without the prior approval of the Board of Directors of the
Corporation in the same or a similar capacity engage in or invest in, or aid or
assist anyone else in the conduct of any business (other than the businesses of
the Corporation and its subsidiaries and affiliates) which directly competes
with the business of the Corporation and its subsidiaries and affiliates as
conducted during the term hereof. If any court of competent jurisdiction shall
determine that any of the provisions of this Section 7 shall not be enforceable
because of the duration or scope thereof, the parties hereto agree that said
court shall have the power to reduce the duration and scope of such provision to
the extent necessary to make it enforceable and this Agreement in its reduced
form shall be valid and enforceable to the extent permitted by law. The
Executive acknowledges that the Corporation's remedy at law for a breach by the
Executive of the provisions of this Section 7 will be inadequate. Accordingly,
in the event of the breach or threatened breach by the Executive of this Section
7, the Corporation shall be entitled to injunctive relief in addition to any
other remedy it may have.
8. Severance Pay. If the Executive's employment hereunder is
involuntarily terminated for any reason other than those set forth in Section
2(c) hereof, then unless the Corporation shall have terminated the Executive for
"Cause", the Corporation shall pay the Executive severance pay in an amount
equal to twenty-four (24) months of the Executive's base
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salary on the effective date of the termination, plus 1/12 of the amount of the
last annual bonus paid to the Executive under the Corporation's bonus plan
applicable to the Executive for each month in the period beginning on January 1
of the year in which the date of the termination occurs and ending on the date
of the termination and for each months' base salary to which the Executive is
entitled under this Section 8, provided, however, that any amount paid to the
Executive by the Corporation for services rendered subsequent to the thirtieth
(30th) day following the communication to the Executive of notice of termination
shall be deducted from the severance pay otherwise due hereunder. Such payment
shall be made in a lump sum within ten (10) business days following the
effective date of the termination. The severance pay shall be in lieu of all
other compensation or payments of any kind relating to the termination of the
Executive's employment hereunder; provided that the Executive's entitlement to
compensation or payments under the Corporation's retirement plans, stock option
or incentive plans, savings plans or bonus plans attributable to service
rendered prior to the effective date of the termination shall not be affected by
this clause and shall continue to be governed by the applicable provisions of
such plans; and further provided that in lieu hereof, at his election, the
Executive shall be entitled to the benefits of the Change in Control Agreement
of even date hereof between the Corporation and the Executive, if termination
occurs in a manner and at a time when such Change in Control Agreement is
applicable. For purposes of this Agreement, the term for "Cause" shall mean
because of gross negligence or willful misconduct by the Executive either in the
course of his employment hereunder or which has a material adverse effect on the
Corporation or the Executive's ability to perform adequately and effectively his
duties hereunder.
9. Notices. Any notices required or permitted to be given under this
Agreement shall be in writing and shall be deemed to have been given when
delivered or mailed, by registered or certified mail, return receipt requested
to the respective addresses of the parties set forth above, or to such other
address as any party hereto shall designate to the other party in writing
pursuant to the terms of this Section 9.
10. Severability. The provisions of this Agreement are severable, and
the invalidity or unenforceability of any provision shall not affect the
validity or enforceability of any other provision.
11. Governing Law. This Agreement shall be governed by and interpreted
in accordance with the substantive laws of the State of Delaware.
12. Supersedure. This Agreement shall cancel and supersede all prior
agreements relating to employment between the Executive and the Corporation,
except the Change in Control Agreement.
13. Waiver of Breach. The waiver by a party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
prior or subsequent breach by any of the parties hereto.
14. Binding Effect. The terms of this Agreement shall be binding upon
and inure to the benefit of the successors and assigns of the Corporation and
the heirs, executors,
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administrators and successors of the Executive, but this Agreement may not be
assigned by the Executive.
IN WITNESS WHEREOF, the Corporation and the Executive have executed
this Agreement as of the day and year first above written.
BOWATER INCORPORATED
By /s/ Xxxxxx X. Xxxxxxx /s/ Xxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxxx Xxxxx X. Xxxxxx
Chairman, Chief Executive Officer
and President
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