Exhibit 10.31
Employment Agreement of Xxxxxxx X. Xxxxxxxxxx
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This Employment Agreement (the "Agreement") is effective as of October 1,
2000 (the "Effective Date"), by and between Smurfit-Stone Container Corporation
(the "Company") and Xxxxxxx X. Xxxxxxxxxx (the "Executive").
WHEREAS, the Company desires to employ the Executive as the Vice President
and General Manager of its Containerboard Mill Division; and
WHEREAS, the Company and the Executive have reached agreement concerning
the terms and conditions of his employment and wish to formalize that agreement;
NOW, THEREFORE, in consideration of the mutual terms, covenants and
conditions stated in this Agreement, the Company and the Executive hereby agree
as follows:
1. Employment. The Company hereby employs the Executive and the Executive
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hereby accepts employment with the Company as Vice President and General Manager
of the Company's Containerboard Mill Division. During the Employment Term (as
hereinafter defined), Executive will have the title, status and duties of Vice
President and General Manager of the Company's Containerboard Mill Division and
will report directly to the Company's President and Chief Executive Officer.
2. Term of Employment. The term of employment ("Employment Term") will
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commence on the Effective Date, and will continue thereafter until two years
from the Effective Date and will be automatically extended for subsequent one
(1) day periods for each day of the Employment Term that passes after the
Effective Date, unless sooner terminated by either party in accordance with the
provisions of this Agreement. The intent of the foregoing provision is that the
Agreement becomes "evergreen" on the Effective Date so that on each passing day
after the Effective Date the Employment Term automatically extends to a full
two-year period.
3. Duties. During the Employment Term:
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(a) The Executive will perform duties assigned by the Company's
President and Chief Executive Officer, Chief Operating Officer or Chief
Financial Officer, or the Company's Board of Directors (the "Board"), from
time to time; provided that the Executive shall not be assigned tasks
inconsistent with those of Vice President and General Manager of the
Company's Containerboard Mill Division.
(b) The Executive will devote his full time and best efforts,
talents, knowledge and experience to serving as the Company's Vice
President and General Manager of its Containerboard Mill Division. However,
the Executive may devote reasonable time to activities such as supervision
of personal investments and activities involving professional, charitable,
educational, religious and similar types of activities, speaking
engagements and membership on other boards of directors, provided such
activities do not interfere in any material way with the business of the
Company; provided that, the Executive cannot serve on the board of
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directors of more than one publicly-traded company without the Board's
written consent. The time involved in such activities shall not be treated
as vacation time. The Executive shall be entitled to keep any amounts paid
to him in connection with such activities (e.g., director fees and
honoraria).
(c) The Executive will perform his duties diligently and competently
and shall act in conformity with Company's written and oral policies and
within the limits, budgets and business plans set by the Company. The
Executive will at all times during the Employment Term strictly adhere to
and obey all of the rules and regulations in effect from time to time
relating to the conduct of executives of the Company. Except as provided
in (b) above, the Executive shall not engage in consulting work or any
trade or business for his own account or for or on behalf of any other
person, firm or company that competes, conflicts or interferes with the
performance of his duties hereunder in any material way.
4. Compensation and Benefits. During Executive's employment hereunder,
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Company shall provide to Executive, and Executive shall accept from Company as
full compensation for Executive's services hereunder, compensation and benefits
as follows:
(a) Base Salary. The Company shall pay the Executive at an annual
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base salary ("Base Salary") of four hundred fifty thousand dollars
($450,000). The Board, or such committee of the Board as is responsible
for setting the compensation of senior executive officers, shall review the
Executive's performance and Base Salary annually in April of each year, and
determine whether to adjust the Executive's Base Salary on a prospective
basis. The first review shall be in April 2001. Such adjusted annual
salary then shall become the Executive's "Base Salary" for purposes of this
Agreement. The Executive's annual Base Salary shall not be reduced after
any increase, without the Executive's consent. The Company shall pay the
Executive's Base Salary according to payroll practices in effect for all
senior executive officers of the Company.
(b) Incentive Compensation. The Executive shall be eligible to
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participate in any annual performance bonus plans, long-term incentive
plans, and/or equity-based compensation plans established or maintained by
the Company for its senior executive officers, including, but not limited
to, the Management Incentive Plan and the Smurfit-Stone Container
Corporation 1998 Long-Term Incentive Plan. The Board (or appropriate Board
committee) will determine and communicate to the Executive his annual
incentive plan participation for subsequent fiscal years, no later than May
31 of such fiscal year.
(c) Executive Benefit Plans. The Executive will be eligible to
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participate on substantially the same basis as the Company's other senior
executive officers in any executive benefit plans offered by the Company
including, without limitation, medical, dental, short-term and long-term
disability, life, pension, profit sharing and nonqualified deferred
compensation arrangements. The Company reserves the right to modify,
suspend or discontinue any and all of the plans, practices, policies and
programs at any
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time without recourse by the Executive, so long as Company takes such
action generally with respect to other similarly situated senior executive
officers.
(d) Perquisites. The Company shall continue to provide to the
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Executive such perquisites as are provided to him on the effective date of
this Agreement.
(e) Business Expenses. The Company shall reimburse the Executive for
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all reasonable and necessary business expenses incurred in the performance
of services with the Company, according to Company's policies and upon
Executive's presentation of an itemized written statement and such
verification as the Company may require.
5. Payments on Termination of Employment.
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(a) Termination of Employment for any Reason. The following payments
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will be made upon the Executive's termination of employment for any reason:
(i) Earned but unpaid Base Salary through the date of
termination;
(ii) Any annual incentive plan bonus, or other form of incentive
compensation, for which the performance measurement period has ended,
but which is unpaid at the time of termination;
(iii) Any accrued but unpaid vacation;
(iv) Any amounts payable under any of the Company's executive
benefit plans in accordance with the terms of those plans, except as
may be required under Code Section 401(a)(13); and
(v) Unreimbursed business expenses incurred by the Executive on
the Company's behalf.
(b) Voluntary Termination of Employment for Other Than Good Reason.
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In addition to the amounts determined under (a) above, if the Executive
voluntarily terminates employment for other than Good Reason, then in
addition to the amounts determined under (a) above, the Executive shall be
entitled to a pro rata portion of the target bonus under the Company's
annual incentive plan for the year in which such termination occurs.
(c) Termination of Employment for Death or Disability. In addition to
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the amounts determined under (a) above, if the Executive's termination of
employment occurs by reason of death or Disability, the Executive (or his
estate) will receive a pro rata portion of any bonus payable under the
Company's annual incentive plan for the year in which such termination
occurs determined based on the highest of (i) the actual annual bonus paid
for the fiscal year immediately preceding such termination, (ii) the target
bonus for the fiscal year in which such termination occurs, or (iii) the
actual bonus attained for the fiscal year in which such termination occurs.
For purposes of this Agreement, "Disability" means the Executive's long-
term disability as defined under the Company's long-term disability plan,
or (iii) if the Executive is not covered by a long-
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term disability plan sponsored by the Company, the Executive's inability to
engage in any substantial gainful activity by reason of any medically-
determined physical or mental impairment that can be expected to result in
death or to be of long-continued and indefinite duration.
(d) Termination by the Company Without Cause, or Voluntary Termination
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by the Executive for Good Reason. If the Company terminates the
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Executive's employment other than for Cause, or the Executive voluntarily
terminates his employment for Good Reason, in addition to the benefits
payable under (a), the Company will pay the following amounts and provide
the following benefits:
(i) The Base Salary and annual bonus that the Company would have
paid under the Agreement had the Executive's employment continued to
the end of the Employment Term. For this purpose, annual bonus will
be determined as the highest of (i) the actual bonus paid for the
fiscal year immediately preceding such termination, (ii) the target
bonus for the fiscal year in which such termination occurs, or (iii)
the actual bonus attained for the fiscal year in which such
termination occurs.
(ii) Continued coverage under the Company's medical, dental,
life, disability, pension, profit sharing and other executive benefit
plans through the end of the Employment Term, at the same cost to the
Executive as in effect on the date of the Executive's termination. If
the Company determines that the Executive cannot participate in any
benefit plan because he is not actively performing services for the
Company, the Company may provide such benefits under an alternate
arrangement, such as through the purchase of an individual insurance
policy that provides similar benefits or, if applicable, through a
nonqualified pension or profit sharing plan. To the extent that the
Executive's compensation is necessary for determining the amount of
any such continued coverage or benefits, such compensation (Base
Salary and annual bonus) through the end of the Employment Term shall
be at the highest rate in effect during the 12-month period
immediately preceding the Executive's termination of employment.
(iii) The Company will provide the Executive with reimbursement
for club dues on the same basis on which the Executive was receiving
such reimbursement prior to his employment termination through the end
of the Employment Term; and the Company will bear the cost of such
reimbursement, at the same level in effect immediately prior to the
Executive's employment termination. Reimbursement otherwise receivable
by the Executive pursuant to this paragraph shall be reduced to the
extent comparable benefits are actually received by or made available
to the Executive without cost during the 24 month period following the
Executive's employment termination. The Executive shall report to the
Company any such benefits actually received by or made available to
the Executive.
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(iv) The period through the end of the Employment Term shall
continue to count for purposes of determining the Executive's age and
service with the Company with respect to (i) eligibility, vesting and
the amount of benefits under the Company's executive benefit plans,
and (ii) the vesting of any outstanding stock options, restricted
stock or other equity-based compensation awards.
(v) The Company will provide the Executive with reimbursement
for such outplacement services as may be selected by the Executive,
not to exceed the amount of reimbursement as is customary for
similarly situated executives of the Company.
(e) Good Reason. For purposes of this Agreement, "Good Reason" shall
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mean the occurrence of any of the following without the Executive's
consent: (i) assigning duties to the Executive that are inconsistent with
those of the position of Vice President and General Manager for similar
companies in similar industries (except to the extent the Company promotes
the Executive to a higher executive position); (ii) requiring the Executive
to report to other than the Company's President and Chief Executive
Officer, or the Company's Board; (iii) the failure of the Company to pay
any portion of the Executive's compensation within 10 days of the date such
compensation is due; (iv) the Company requires the Executive to relocate
his principal business office to a location not within 50 miles of either
the Company's principal business office located in the St. Louis, Missouri
metropolitan area, or the Company's principal business office located in
the Chicago, Illinois metropolitan area (provided, that, the Company's
requiring the Executive to relocate his principal office from Chicago to
St. Louis, or from St. Louis to Chicago, will not constitute Good Reason);
or (v) the Company's failure to continue in effect any cash or stock-based
incentive or bonus plan, pension plan, welfare benefit plan or other
benefit plan, program or arrangement, unless the aggregate value of all
such arrangements provided to the Executive after such discontinuance is
not materially less than the aggregate value as of the Effective Date. For
purposes of this paragraph, "Company" shall mean the Company and, following
any Change in Control, the Surviving Corporation or, if applicable, the
Parent Corporation (as those terms are defined in Section 6(d)).
(f) Cause. For purposes of this Agreement, "Cause" shall mean: (i)
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the Executive's willful and continued failure to substantially perform his
duties as an executive of the Company (other than any such failure
resulting from incapacity due to physical or mental illness) after a
written demand for substantial performance is delivered to the Executive by
the Board, which demand specifically identifies the manner in which the
Board believes that the Executive has not substantially performed his
duties, and which gives the Executive at least 30 days to cure such alleged
deficiencies, (ii) the Executive's willful misconduct, which is
demonstrably and materially injurious to the Company, monetarily or
otherwise, or (iii) the Executive's engaging in egregious misconduct
involving serious moral turpitude to the extent that his creditability and
reputation no longer conforms to the standard of senior executive officers
of the Company.
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(g) Timing of Payments. All payments described above shall be made in
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a lump sum cash payment as soon as practicable (but in no event more than
10 days) following the Executive's termination of employment. If the total
amount of annual bonus is not determinable on that date, the Company shall
pay the amount of bonus that is determinable and the remainder shall be
paid in a lump sum cash payment within 10 days of the date that annual
performance results are finalized.
6. Change in Control.
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(a) Payments and Benefits Upon Employment Termination After a Change
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in Control. If within two years after a Change in Control (as defined
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below), the Company terminates the Executive's employment other than for
Cause, or the Executive voluntarily terminates his employment for Good
Reason, the Company will provide the following payments and benefits to the
Executive, in lieu of those payments and benefits provided under Sections
5(c) or (d) above, but in addition to the amounts payable under Section
5(a) above:
(i) Two times the Executive's Base Salary as in effect on the
date of the Executive's termination of employment.
(ii) Two times the highest of (i) the average annual bonus paid
for the two fiscal years immediately preceding the Executive's
employment termination, (ii) the target bonus for the fiscal year in
which such termination of employment occurs, or (iii) the actual bonus
attained for the fiscal year in which such termination occurs.
(iii) Continued coverage for a period of 24 months from the
Executive's termination under the Company's medical, dental, life,
disability and other welfare benefit plans, at the same cost to the
Executive as in effect on the date of the Change in Control (or, if
lower, as in effect at any time thereafter). If the Company determines
that the Executive cannot participate in any benefit plan because he
is not actively performing services for the Company, the Company may
provide such benefits under an alternate arrangement, such as through
the purchase of an individual insurance policy that provides similar
benefits. The amount of such continued coverage shall be determined,
if applicable, by adding 24 additional months of age and service to
the Executive's actual age and service as of the Executive's
termination date and as if the Executive earned compensation during
such 24-month period at the rate in effect during the 12-month period
immediately preceding his termination date. The Executive's
eligibility for any retiree medical or life coverage following such
termination date shall also be determined by adding 24 additional
months of age and service to the Executive's actual age and service as
of the termination date.
(iv) The value of continued coverage for a period of 24 months
under any pension, profit sharing or other retirement plan maintained
by the Company. The value of such coverage under a tax qualified plan
may be provided through a nonqualified pension or profit sharing plan
and shall be determined by adding 24
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additional months of age and service to the Executive's actual age and
service at the date of the Executive's termination of employment and
as if the Executive earned compensation during such 24-month period at
the rate in effect during the 12-month period immediately preceding
his termination date. In the case of a defined benefit pension plan,
such value shall include any early retirement subsidies to which the
Executive would have become entitled under the plan and shall be
determined using the actuarial factors set forth in such plan.
(v) The Company will provide the Executive with reimbursement
for club dues on the same basis on which the Executive was receiving
such reimbursement prior to the Change in Control for 24 months
following the Executive's employment termination. The Company will
bear the cost of such reimbursement, at the same level in effect
immediately prior to the Change in Control. Reimbursement otherwise
receivable by the Executive pursuant to this paragraph shall be
reduced to the extent comparable benefits are actually received by or
made available to the Executive without cost during the 24 month
period following the Executive's employment termination. The Executive
shall report to the Company any such benefits actually received by or
made available to the Executive.
(vi) Immediate vesting of all stock options, restricted stock
and other equity-based awards.
(vii) The Company will provide the Executive with reimbursement
for such outplacement services as may be selected by the Executive,
not to exceed the amount of reimbursement as is customary for
similarly situated executives of the Company.
(b) Timing of Payment. All payments under paragraphs (a)(i), (ii) and
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(iv) above, and paragraph (c) below, shall be made in a lump sum cash
payment as soon as practicable, but in no event more than 10 days after the
Executive's termination of employment (or the date of the Change in
Control, if applicable). If the total amount of bonus is not determinable
on that date, the Company shall pay the amount of bonus that is
determinable, and shall pay the remainder in a lump sum cash payment within
10 days of the date that annual performance results are finalized.
(c) Definition of Change in Control. For purposes of the Agreement, a
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"Change in Control" of the Company will be deemed to occur as of the first
day that any one or more of the following condition is satisfied:
(i) The "beneficial ownership" (as defined in Rule 13d-3 under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"))
of securities representing more than 20 percent (20%) of the combined
voting power of the then outstanding voting securities of the Company
entitled to vote generally in the election of directors (the "Company
Voting Securities") is accumulated, held or acquired by a Person (as
defined in Section 3(a)(9) of the Exchange Act, as modified, and used
in Sections 13(d) and 14(d) thereof) (other than the Company,
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any trustee or other fiduciary holding securities under an employee
benefit plan of the Company or an affiliate thereof, any corporation
owned, directly or indirectly, by the Company's stockholders in
substantially the same proportions as their ownership of stock of the
Company); provided, however that any acquisition from the Company or
any acquisition pursuant to a transaction that complies with clauses
(A), (B) and (C) of subparagraph (iii) of this paragraph will not be a
Change in Control under this subparagraph (i), and provided further,
that immediately prior to such accumulation, holding or acquisition,
such Person was not a direct or indirect beneficial owner of 20
percent or more of the Company Voting Securities; or
(ii) Individuals who, as of the date of the Agreement,
constitute the Board of Directors (the "Incumbent Board") cease for
any reason to constitute at least a majority of the Board of
Directors; provided, however, that any individual becoming a director
subsequent to the date hereof whose election, or nomination for
election by the Company's stockholders, was approved by a vote of at
least a majority of the directors then comprising the Incumbent Board
will be considered as though such individual were a member of the
Incumbent Board, but excluding, for this purpose, any such individual
whose initial assumption of office occurs as a result of an actual or
threatened election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board of
Directors; or
(iii) Consummation by the Company of a reorganization, merger or
consolidation, or sale or other disposition of all or substantially
all of the assets of the Company or the acquisition of assets or stock
of another entity (a "Business Combination"), in each case, unless
immediately following such Business Combination: (A) more than 60% of
the combined voting power of then outstanding voting securities
entitled to vote generally in the election of directors of (x) the
corporation resulting from such Business Combination (the "Surviving
Corporation"), or (y) if applicable, a corporation that as a result of
such transaction owns the Company or all or substantially all of the
Company's assets either directly or through one or more subsidiaries
(the "Parent Corporation"), is represented, directly or indirectly by
Company Voting Securities outstanding immediately prior to such
Business Combination (or, if applicable, is represented by shares into
which such Company Voting Securities were converted pursuant to such
Business Combination), and such voting power among the holders thereof
is in substantially the same proportions as their ownership,
immediately prior to such Business Combination, of the Company Voting
Securities, (B) no Person (excluding any employee benefit plan (or
related trust) of the Company or such corporation resulting from such
Business Combination) beneficially owns, directly or indirectly, 20%
or more of the combined voting power of the then outstanding voting
securities eligible to elect directors of the Parent Corporation (or,
if there is no Parent Corporation, the Surviving Corporation) except
to the extent that such ownership of the Company existed prior to the
Business Combination and (C) at least a majority of the members of the
board of directors of the Parent Corporation (or, if there is no
Parent Corporation, the Surviving
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Corporation) were members of the Incumbent Board at the time of the
execution of the initial agreement, or of the action of the Board,
providing for such Business Combination; or
(iv) Approval by the Company's stockholders of a complete
liquidation or dissolution of the Company.
However, in no event will a Change in Control be deemed to have
occurred, with respect to the Executive, if the Executive is part of a
purchasing group that consummates the Change in Control transaction. The
Executive will be deemed "part of a purchasing group" for purposes of the
preceding sentence if the Executive is an equity participant in the
purchasing company or group (except: (i) passive ownership of less than
two percent (2%) of the stock of the purchasing company; or (ii) ownership
of equity participation in the purchasing company or group that is
otherwise not significant, as determined prior to the Change in Control by
a majority of the nonemployee continuing Directors).
7. Restrictive Covenants.
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(a) Definitions. For purposes of this Agreement, the following terms
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will be defined as follows:
(i) "Confidential Information" shall mean the Company's trade
secrets and all other information unique to the Company and not
readily available to the public, including developments, designs,
improvements, inventions, formulas, compilations, methods, strategies,
forecasts, software programs, processes, know-how, data, research,
operating methods and techniques, and all business plans, strategies,
costs, profits, customers, vendors, markets, sales, products, key
personnel, pricing policies, marketing, sales or other financial or
business information, and any modifications or enhancements of any of
the foregoing.
(ii) The term "Business Conducted by the Company or any of its
Affiliates" shall mean all businesses conducted by the Company or any
of its Affiliates as of the Effective Date, of whatever kind, within
or outside of the United States.
(iii) The term "Affiliates" shall mean (i) any entity that
directly or indirectly, is controlled by the Company, and (ii) any
entity in which the Company has a significant equity interest.
(b) Inventions or Developments. The Executive agrees that he will
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promptly and fully disclose to the Company all discoveries, improvements,
inventions, formulas, ideas, processes, designs, techniques, know-how, data
and computer programs (whether or not patentable, copyrightable or
susceptible to any other form of protection), made, conceived, reduced to
practice or developed by the Executive, either alone or jointly with
others, during his employment with the Company (collectively, the
"Inventions or Developments"). All Inventions and Developments shall be
the sole property of the Company, including all patents, copyrights,
intellectual property or other rights related
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thereto and Executive assigns to the Company all rights (if any) that the
Executive may have or acquire in such Inventions or Developments.
Notwithstanding the foregoing, any right of the Company or assignment
by the Executive as provided in this paragraph shall not apply to any
Inventions or Developments for which no equipment, supplies, facility or
trade secret information of the Company or its Affiliates were used and
which were developed entirely on the Executive's own time, unless: (i) the
Inventions or Developments relate to the Business Conducted by the Company
or any of its Affiliates or the actual or demonstrably anticipated research
or development of the Company or any of its Affiliates; or (ii) the
Inventions or Developments result from any work performed by the Executive
for the Company or any of its Affiliates.
(c) Non-Disclosure of Confidential Information or Inventions or
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Developments. The Executive acknowledges that he has had and will have
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access to Confidential Information or Inventions or Developments of the
Company and/or its Affiliates and agrees that he shall not, at any time,
directly or indirectly use, divulge, furnish or make accessible to any
person any Confidential Information or Inventions or Developments, but
instead shall keep all such matters strictly and absolutely confidential.
(d) No Diversion of Business Opportunities and Prospects. The
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Executive agrees that during his employment with the Company: (i) the
Executive shall not directly or indirectly engage in any employment,
consulting or other business activity that is competitive with the Business
Conducted by the Company or any of its Affiliates; (ii) the Executive shall
promptly disclose to the Company all business opportunities that are
presented to the Executive in his capacity as an employee of the Company or
which is of a similar nature to the Business Conducted by the Company or
any of its Affiliates or which the Company or its Affiliates have expressed
an interest in engaging in the future; and (iii) the Executive shall not
usurp or take advantage of any such business opportunity without first
offering such opportunity to the Company.
(e) Actions Upon Termination. Upon the Executive's employment
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termination for whatever reason, the Executive shall neither take or copy
nor allow a third party to take or copy, and shall deliver to the Company
all property of the Company, including, but not limited to, all
Confidential Information or Inventions or Developments, regardless of the
medium (i.e., hard copy, computer disk, CD ROM) on which the information is
contained.
(f) Non-Competition. The Executive agrees that so long as he is
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employed by the Company and for a period of two (2) years thereafter (the
"Period"), he shall not, without the prior written consent of the Company,
participate or engage in, directly or indirectly (as an owner, partner,
employee, officer, director, independent contractor, consultant, advisor or
in any other capacity calling for the rendition of services, advice, or
acts of management, operation or control), any business that, during the
Period, is competitive with the Business Conducted by the Company or any of
its Affiliates within the United States (hereinafter, the "Geographic
Area").
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(g) Non-Solicitation of Employees. The Executive agrees that, during
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the Period, he shall not, without the prior written consent of the Company,
directly or indirectly solicit any current employee of the Company or any
of its Affiliates, or any individual who becomes an employee during the
Period, to leave such employment and join or become affiliated with any
business that is, during the Period, competitive with the Business
Conducted by the Company or any of its Affiliates within the Geographic
Area.
(h) Non-Solicitation of Suppliers or Customers. The Executive agrees
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that, during the Period, he shall not, without the prior written consent of
the Company, directly or indirectly solicit, seek to divert or dissuade
from continuing to do business with or entering into business with the
Company or any of its Affiliates, any supplier, customer, or other person
or entity that had a business relationship with or with which the Company
was actively planning or pursuing a business relationship at or before the
date of termination of his employment.
(j) Irreparable Harm. The Executive acknowledges that: (i) the
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Executive's compliance with this Section is necessary to preserve and
protect the Confidential Information, Inventions or Developments and the
goodwill of the Company and its Affiliates as going concerns; (ii) any
failure by the Executive to comply with the provisions of this Section will
result in irreparable and continuing injury for which there will be no
adequate remedy at law; and (iii) in the event that the Executive should
fail to comply with the terms and conditions of this Section, the Company
shall be entitled, in addition to such other relief as may be proper, to
all types of equitable relief (including, but not limited to, the issuance
of an injunction and/or temporary restraining order) as may be necessary to
cause the Executive to comply with this Section, to restore to the Company
its property, and to make the Company whole.
(j) Survival. The provisions set forth in this Section shall, as
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noted, survive termination of this Agreement.
(k) Forfeiture. If the Executive violates any provision of this
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Section, the Executive will forfeit his right to all payments and benefits
under Section 5(d) and Section 6, except to the extent otherwise provided
by law.
(l) Unenforceability. If any provision(s) of this Section shall be
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found invalid or unenforceable, in whole or in part, then such provision(s)
shall be deemed to be modified or restricted to the extent and in the
manner necessary to render the same valid and enforceable, or shall be
deemed excised from this Agreement, as the case may require, and this
Agreement shall be construed and enforced to the maximum extent permitted
by law, as if such provision(s) had been originally incorporated herein as
so modified or restricted, or as if such provision(s) had not been
originally incorporated herein, as the case may be.
8. Assignment; Successors. This Agreement shall inure to the benefit of
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and be binding upon the Company and its successors. The Company may not assign
this Agreement without the Executive's written consent, except that the
Company's obligations under this
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Agreement shall be the binding legal obligations of any successor to the Company
by sale, and in the event of any transaction that results in the transfer of
substantially all of the assets or business of the Company, the Company will use
its best efforts to cause the transferee to assume the obligations of the
Company under this Agreement. The Executive may not assign this Agreement during
his life. Upon the Executive's death this Agreement will inure to the benefit of
Executive's heirs, legatees and legal representatives of the Executive's estate.
9. Interpretation. The laws of the State of Illinois shall govern the
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validity, interpretation, construction and performance of this Agreement,
without regard to the conflict of laws principles thereof.
10. Withholding. The Company may withhold from any payment that it is
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required to make under this Agreement amounts sufficient to satisfy applicable
withholding requirements under any federal, state or local law.
11. Amendment or Termination. This Agreement may be amended at any time
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by written agreement between the Company and the Executive.
12. Notices. Notices given pursuant to this Agreement shall be in writing
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and shall be deemed received when personally delivered, or on the date of
written confirmation of receipt by (i) overnight carrier, (ii) telecopy, (iii)
registered or certified mail, return receipt requested, addressee only, postage
prepaid, or (iv) such other method of delivery that provides a written
confirmation of delivery. Notice to the Company shall be directed to:
Smurfit-Stone Container Corporation
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
The Company may change the person and/or address to whom the Executive must give
notice under this Section by giving the Executive written notice of such change,
in accordance with the procedures described above. Notices to or with respect
to the Executive will be directed to the Executive, or to the Executive's
executors, personal representatives or distributees, if the Executive is
deceased, or the assignees of the Executive, at the Executive's home address on
the records of the Company.
13. Severability. If any provisions(s) of this Agreement shall be found
------------
invalid or unenforceable by a court of competent jurisdiction, in whole or in
part, then it is the parties' mutual desire that such court modify such
provision(s) to the extent and in the manner necessary to render the same valid
and enforceable, and this Agreement shall be construed and enforced to the
maximum extent permitted by law, as if such provision(s) had been originally
incorporated herein as so modified or restricted, or as if such provision(s) had
not been originally incorporated herein, as the case may be.
14. Entire Agreement. This Agreement sets forth the entire agreement and
----------------
understanding between the Company and the Executive and supersedes all prior
agreements and understandings, written or oral, relating to the subject matter
hereof, including, without
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limitation, the Change in Control Agreement between the Company and Executive
dated July 21, 1998.
15. Consultation With Counsel. Executive acknowledges that he has had a
-------------------------
full and complete opportunity to consult with counsel of Executive's own
choosing concerning the terms, enforceability and implications of this
Agreement, and the Company has made no representations or warranties to
Executive concerning the terms, enforceability or implications of this Agreement
other than as are reflected in this Agreement.
16. No Waiver. No failure or delay by the Company or the Executive in
---------
enforcing or exercising any right or remedy hereunder shall operate as a waiver
thereof. No modification, amendment or waiver of this Agreement nor consent to
any departure by the Executive from any of the terms or conditions thereof,
shall be effective unless in writing and signed by the Chairman of the Company's
Board. Any such waiver or consent shall be effective only in the specific
instance and for the purpose for which given.
17. Effect on Other Obligations. Payments and benefits herein provided to
---------------------------
be paid to the Executive by the Company shall be made without regard to and in
addition to any other payments or benefits required to be paid the Executive at
any time hereafter under the terms of any other agreement between the Executive
and the Company or under any other policy of the Company relating to
compensation, or retirement or other benefits. No payments or benefits provided
the Executive hereunder shall be reduced by any amount the Executive may earn or
receive from employment with another employer or from any other source.
18. Survival. All Sections of this Agreement survive beyond the
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Employment Term except as otherwise specifically stated.
19. Headings. The headings in this Agreement are for convenience of
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reference only and shall not limit or otherwise affect the meaning thereof.
20. Counterparts. The parties may execute this Agreement in one or more
------------
counterparts, all of which together shall constitute but one Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement effective
as of the date first above written.
Smurfit-Stone Container Corporation
/s/ Xxxxxxx X. Xxxxxxxxxx
------------------------------
Xxxxxxx X. Xxxxxxxxxx By: /s/ Xxx X. Xxxxxx
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Xxx X. Xxxxxx
Its: President
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