Long Term Performance Compensation from Employment Agreement
This Employment Agreement (this Agreement) is made and entered into as of January 4, 2005 (the Effective Date), by and between Werner Co., a Pennsylvania corporation (the Company), and Steven P. Richman (Executive).
Long Term Performance Compensation. Executive will have the potential to earn up to $5 Million over 5 years to be vested as follows: a) $1 million time vesting pro-rata equally over 5 years ($200,000/yr with acceleration of any unpaid amounts if there is an exit/sale for a majority of equity or termination without cause), b) $3 million vesting pro-rata equally over 5 years ($600,000/yr with the opportunity to be considered for acceleration of any unpaid amounts if there is an exit/sale for a majority of equity, performance significantly above agreed upon targets or termination without cause) upon achievement of annual performance based targets (i.e. EBITDA), and c) $1 million vesting upon closing of successful exit/sale for majority of equity. Two-thirds of the vested amount of items (a) and (b) above would be paid in cash after 5 years and the remainder upon the closing of a successful exit/sale for a majority of the equity. All vested amounts would be paid upon death or permanent disability. Additionally, the Company will use its reasonable best efforts to develop a plan by June 2005 such that Executive would be eligible for consideration of additional equity, depending on the time frame, if there is outstanding business performance (equity value) and personal performance.