SIXTH AMENDMENT TO
EMPLOYMENT AGREEMENT
This SIXTH AMENDMENT TO EMPLOYMENT AGREEMENT is made as of
the 3rd day of June, 2002 by and between CHECKPOINT SYSTEMS, INC.
("CSI") and MICHAEL E. SMITH ("Executive").
WHEREAS, CSI and Executive are parties to an Employment
Agreement dated July 1, 1995, as amended as of July 1, 1997, March 25, 1999,
July 17, 2001, January 1, 2002 and March 6, 2002 ("Agreement"); and
WHEREAS, CSI has determined it is in its best interests to
modify the Agreement by providing various incentives as described herein in
order to encourage the Executive to continue with his employment as indicated
herein;
NOW, THEREFORE, in consideration of the premises and mutual
promises and covenants contained herein, and intending to be bound hereby, the
parties agree as follows:
1. Paragraph 3 of the Fifth Amendment to Employment Agreement
dated as of March 6, 2002 ("Fifth Amendment") shall be deleted in its entirety,
and the following provision shall apply:
"The extension of the Term as provided in Section 1 of the
Fifth Amendment, shall not be considered as an "extension or new
agreement" for purposes of determining Executive's entitlement to
severance benefits as provided in Section 6.E. Therefore, should
Executive's employment be terminated for any reason, prior to July 15,
2002 with or without cause (excluding a voluntary termination by
Executive prior to July 15, 2002)[1], in addition to his Base Salary
paid through July 15, 2002, Executive shall be entitled to receive: (i)
severance pay for a period of thirty (30) months consisting of the
payment of one hundred percent (100%) of Executive's monthly Base
Salary as of March 1, 2002; (ii) continuation of health insurance
benefits, life and disability insurance benefits for the thirty (30)
month period; (iii) the cash equivalent of vacation previously earned
and not taken to which Executive is entitled under CIS policy; the
approximate cost of outplacement services, i.e., Seventy-Five Thousand
Dollars ($75,000.00), 401K benefits for the thirty (30) month period;
and (iv) an incentive plan bonus of One Hundred Fifty Three Thousand
Dollars ($153,000.00). The benefits described in (i), (iii) and (iv)
shall be paid in a lump sum on July 15, 2002. If Executive voluntarily
terminates his employment prior to July 15, 2002, and does not offer to
continue to remain in his position through July 15, 2002, Executive
shall be entitled to receive severance pay for a period of thirty (30)
months consisting of the payment of one hundred percent (100%) of
Executive's monthly Base Salary as of February 28, 2002 payable on the
date of termination, and continuation of health insurance benefits,
life and disability insurance benefits and 401(K) benefits for the
thirty (30) month period.
2. The Agreement constitutes the entire agreement between the
parties with respect to the subject matter hereof, and cannot be changed or
terminated orally. To the extent not inconsistent with this Sixth Amendment, the
Employment Agreement of July 1, 1995, as amended prior to the date hereof, is
hereby ratified and confirmed. No modification or waiver of any of the
provisions hereof shall be effective unless in writing and signed by the party
against whom it is sought to be enforced.
IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed on the date first above written.
ATTEST: CHECKPOINT SYSTEMS, INC.
By: /s/ R. Keith Elliott
-----------------------------
Chairman of the Board
WITNESS:
/s/ Michael E. Smith
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[1] If Executive, prior to July 15, 2002, notifies CSI of his intention to
terminate his employment but offers to remain in his position through
July 15, 2002, such early termination shall not be considered a voluntary
termination by Executive, even if CSI releases him or consents to his
departure prior to July 15, 2002.