EXHIBIT 10.38
OMNIBUS AMENDMENT TO
XXXXXX XXXXXXX'X
EMPLOYMENT AGREEMENT
AND
OPTION AGREEMENTS
This OMNIBUS AMENDMENT TO XXXXXX XXXXXXX'X EMPLOYMENT AGREEMENT AND OPTION
AGREEMENTS, dated as of November 23, 1999 (this "Amendment"), is entered into by
and between Xxxxxx X. Xxxxxxx (the "Executive") and BWAY Corporation, a Delaware
corporation (the "Company"). The Company and the Executive are referred to
collectively herein as the "Parties" and individually as a "Party."
WHEREAS, the Executive and the Company are parties to an Employment
Agreement, dated as of June 1, 1995 (the "Employment Agreement");
WHEREAS, the Company granted to the Executive as of May 17, 1997, pursuant
to the Company's Amended and Restated 1995 Long-Term Incentive Plan (as further
amended and restated, the "Plan"), options to acquire 37,500 shares (as adjusted
to reflect a 3-for-2 stock split) of the common stock of the Company (the "May
1997 Options");
WHEREAS, the Company granted to the Executive as of August 19, 1997,
pursuant to the Plan, options to acquire 37,500 shares (as adjusted to reflect a
3-for-2 stock split) of the common stock of the Company (the "August 1997
Options");
WHEREAS, the Company granted to the Executive as of November 16, 1998,
pursuant to the Plan, options to acquire 36,667 shares of the common stock of
the Company (the "November 1998 Options" and, together with the May 1997 Options
and the August 1997 Options, the "Options"); and
WHEREAS, the Company and the Executive desire to amend the Employment
Agreement and the Options, effective as of the date hereof, in anticipation of
the Executive's planned retirement as Chief Executive Officer of the Company on
December 31, 1999.
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Parties hereto agree as follows:
1. Position, Duties and Place of Employment. Paragraph 2 of the
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Employment Agreement is hereby amended by adding the following:
"Upon Executive's December 31, 1999 retirement as Chief Executive Officer
and an employee of the Company and continuing for so long as Executive is a
member of the Board, Executive shall have the title of Vice-Chairman of the
Board."
2. Base Salary, Bonus and Benefits. Paragraph 3(a) of the Employment
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Agreement is hereby amended by adding the following:
"Notwithstanding the immediately preceding sentence, and in light of
Executive's December 31, 1999 retirement as Chief Executive Officer and an
employee, the Board may, following the end of the Company's fiscal year
2000, award Executive a bonus equal to 25% of the bonus Executive would
otherwise have received pursuant to the immediately preceding sentence had
Executive served as Chief Executive Officer of the Company for the entire
fiscal year 2000 if, as determined by the board in its sole judgment,
Executive has met the goals and objectives approved by the Board for such
year."
3. Term. Paragraphs 4(a) through 4(e) of the Employment Agreement are
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hereby replaced by the following:
"(a) The Employment Period shall end on December 31, 1999.
(b) Executive shall be entitled to receive his Base Salary through
December 31, 1999. Except as provided in paragraph 3(a) and paragraph 5,
all of Executive's rights to participate in any of the Company's employee
benefit programs or receive bonuses hereunder shall cease on December 31,
1999, except for benefits required by law."
4. Supplemental Retirement Benefit. Paragraphs 5(a) through 5(d) of the
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Employment Agreement are hereby replaced by the following:
"(a) Eligibility. The Executive shall be entitled to receive a monthly
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supplemental retirement benefit for services rendered to the Company, the
amount of which shall be determined in accordance with this paragraph 5.
(b) Amount. The amount of the monthly supplemental retirement benefit
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payable to the Executive shall be equal to $13,125, which is an amount
equal to 1/12th of 35% of Executive's Base Salary of $450,000 in effect on
December 31, 1999, and the Executive's "Retirement Date" shall be
December 31, 1999.
(c) Commencement and Duration. Payment of the Executive's monthly
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supplemental retirement benefit shall commence as of the first day of the
calendar month that begins coincident with or immediately after the date on
which the Executive attains age 74. Monthly payments shall continue to be
made to the Executive as of the first day of each subsequent month, with
the last payment to be made for the month during which Executive's death
occurs."
5. Executive Representations. Executive hereby remakes the
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representations set forth in paragraph 11 of the Employment Agreement, except
that all references to "the Agreement" therein shall be deemed to be references
to the Agreement as amended hereby.
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6. Option Vesting After Termination of Employment. Paragraph 2(b)(ii)
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of each of the Options is hereby replaced by the following:
"(ii) If the Optionee retires from employment with the Company and does
not continue to serve as a director of the Company after such retirement,
the Optionee's NQOs shall be vested and fully exercisable with respect to
that portion of the Optionee's NQOs that were exercisable on the date of
the Optionee's retirement (subject to the terms of the Plan) for a period
of up to five years after the date of such retirement but in no event after
the expiration of the NQO; provided the Optionee does not engage in
Competition (as defined in the Plan) during such five year period unless he
or she receives written consent to do so from the board of directors of the
Company or the Committee. Any portion of the Optionee's NQOs that were not
exercisable on the date of such retirement shall expire and be forfeited."
Paragraph 2(b) of each of the Options is hereby further amended by adding the
following new subparagraph (iv) thereto:
"(iv) If the Optionee retires from employment with the Company and
continues to serve as a director of the Company after such retirement, the
Optionee's NQOs shall continue to vest as set forth in the second sentence
of this option grant; provided the Optionee does not engage in Competition
(as defined in the Plan) during such vesting period unless he or she
receives written consent to do so from the board of directors of the
Company or the Committee. If, after the Optionee's retirement from
employment with the Company, the Optionee ceases, at any time, to serve as
a director of the Company, the Optionee's NQOs shall be vested and fully
exercisable with respect to that portion of the Optionee's NQOs that were
exercisable on the date the Optionee first ceased to serve as a director
(subject to the terms of the Plan) for a period of up to five years after
the date of such cessation but in no event after the expiration of the NQO;
provided the Optionee does not engage in Competition (as defined in the
Plan) during such five year period unless he or she receives written
consent to do so from the board of directors of the Company or the
Committee. Any portion of the Optionee's NQOs that were not exercisable on
the date the Optionee first ceased to serve as a director shall expire and
be forfeited."
7. Effect; Entire Agreement. Except as amended by this Amendment, the
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Employment Agreement and each of the Options remain in full force and effect.
The Employment Agreement, each of the Options, and this Amendment constitute the
entire agreements between the Parties and supersede any prior understandings,
agreements or representations by or between the Parties, written or oral, that
may have related in any way to the subject matter hereof.
* * * * *
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IN WITNESS WHEREOF, the Parties have executed this Omnibus Amendment to
Xxxxxx Xxxxxxx'x Employment Agreement and Option Agreements as of the date first
written above.
BWAY CORPORATION
By: /s/ Xxxxx Xxxxxxxxxxx
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Its: VP & General Counsel
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EXECUTIVE
/s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
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