EXHIBIT 10(q)
EMPLOYMENT AGREEMENT
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AGREEMENT made this 16th day of March, 1995, by and between
UNITED INDUSTRIAL CORPORATION, a Delaware corporation having an
address at 18 East 48th Street, New York, New York 10017 (hereinafter
called "Employer"), and P. DAVID BOCKSCH, having an address at 90
Ardmore Road, Ho-Ho-Kus, New Jersey 07423 (hereinafter called
"Employee").
W I T N E S S E T H :
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In consideration of the mutual covenants hereinafter
contained, the parties hereto agree as follows:
1. Employment. Employer agrees to employ Employee and
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Employee agrees to serve Employer upon the terms and conditions
hereinafter set forth.
2. Term. The employment of Employee hereunder shall be
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effective and shall commence on March 27, 1995 (the "Effective Date")
and shall terminate as of the close of business on the date three (3)
years after the Effective Date (the "Termination Date"). The period
from the Effective Date through the Termination Date is referred to as
the term of this Agreement.
3. Duties and Extent of Services. Employee agrees to serve
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Employer and its subsidiary companies faithfully and to the best of
his ability under the direction of the Board of Directors of Employer,
devoting his entire business time, energy and skill
to his duties hereunder. The principal place of employment of
Employee shall be at the offices of Employer located in New York, New
York. Employee understands and agrees, however, that in connection
with his employment hereunder, he may be required from time to time to
travel on behalf of Employer.
The principal duties of Employee shall be to serve as
President and Chief Executive Officer of Employer and, in such
capacity, to render such managerial, administrative and other services
to Employer and its subsidiaries as normally are associated with and
incident to such position as Employer from time to time may require of
him. If, during the term of this Agreement, the Board of Directors of
Employer so determines, in its absolute discretion, to elect Employee
to any additional office of Employer or its subsidiary companies
consistent with his position, or a director of Employer or its
subsidiary companies, Employee agrees to accept and serve in such
office or capacity for no additional compensation or remuneration. It
is the intention of the parties that Employee shall be elected a
director of Employer.
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4. Compensation.
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(a) Salary. Employer agrees to pay to Employee, as
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compensation for all of the services to be rendered by Employee under
or pursuant to this Agreement, a salary at the rate of three hundred
thousand dollars ($300,000) per annum, commencing as of the Effective
Date, payable in accordance with Employer's normal payroll practices.
Such salary shall be subject to annual review by Employer's Board of
Directors and, at the discretion of the Board, may be increased, but
not decreased below such amount. Employee shall also be eligible to
receive annual discretionary bonuses as may be granted by Employer's
Board of Directors, not to exceed fifty percent (50%) of his then
annual base salary. Employee shall receive a guaranteed minimum bonus
of fifty thousand dollars ($50,000) for 1995, payable no later than
April 1, 1996.
(b) Employee Benefit Plans. During the term of this
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Agreement, Employee shall be eligible to participate in any life
insurance, medical, retirement, pension or profit-sharing, disability
or other benefit plans or arrangements now or hereafter generally made
available by Employer to executive employees of Employer to the extent
Employee qualifies under the provisions of any such plans. Subject to
the foregoing, Employer shall have the right to change insurance
companies and modify insurance policies covering employees of
Employer. For purposes
of Employee's participation in the AAI Pension Plan (the "Plan"),
Employee shall be deemed vested in the Plan as of the Effective Date,
provided, however, if he is not vested under the terms of the Plan,
Employer shall make the payments to him that he otherwise would have
received under the Plan had he been vested under the terms of the
Plan. This provision shall have no impact, however, on the Plan and
shall not be deemed an amendment of the Plan. This provision shall
not apply, however, if Employee's employment by Employer is terminated
prior to the third anniversary of the Effective Date either
voluntarily by him or by Employer for cause as provided in Section 12
hereof.
(c) Automobile Allowance. Employer shall pay to
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Employee an automobile allowance of fifteen thousand dollars ($15,000)
per annum, commencing as of the Effective Date, payable in accordance
with Employer's normal payroll practices.
(d) Stock Options. Employer shall grant to Employee
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on the Effective Date options to acquire 100,000 shares of common
stock of Employer pursuant to the terms of Employer's 1994 Stock
Option Plan and the grant letter in the form annexed hereto as Exhibit
A. The exercise price of such options shall be equal to the fair
market value of such common stock as of the grant date.
(e) Vacation. Employee shall be entitled to three (3)
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weeks vacation with pay per year.
(f) Taxes. Employee understands that any and all
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payments described in this Agreement will be subject to such tax
treatment as applies thereto, and to such withholding as may be
required under applicable tax laws.
(g) Attorney's Fees. Employer shall reimburse
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Employee for his reasonable attorney's fees incurred in connection
with his entering into this Agreement, up to a maximum amount of
$2,500, to be paid following the submission to Employer of an
appropriate statement or invoice therefor.
5. No Competition. Employee agrees that during the term of
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this Agreement he will not, within the continental United States,
directly or indirectly, engage or participate or make any financial
investments in or become employed by or render advisory or other
services to or for any person, firm or corporation, or in connection
with any business activity, other than that of Employer and its
subsidiary companies, directly or indirectly in competition with any
of the business operations or activities of Employer and its
subsidiary companies. Nothing herein contained, however, shall
restrict Employee from making any investments in any company whose
stock is listed on a national securities exchange or actively traded
in the over-the-counter market, so long as such investment does not
give him the right to control or influence the policy decisions of any
such business or enterprise which is or might be directly or
indirectly in competition with
any of such business operations or activities of Employer or any of
its subsidiary companies.
6. Confidentiality; etc.
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(a) Employee will not divulge, furnish or make
accessible to anyone (other than in the regular course of business of
Employer or any of its subsidiary companies) any knowledge or
information with respect to confidential or secret methods, processes,
plans or materials of Employer or any of its subsidiary companies, or
with respect to any other confidential or secret aspects of the
business of Employer or any of its subsidiary companies.
(b) Employee agrees to communicate and to make known
to Employer all knowledge possessed by him relating to any methods,
developments, inventions and/or improvements, whether patented,
patentable or unpatentable which concerns in any way the business of
Employer or any of its subsidiary companies or the general industry of
which they are a part, from the time of entering upon employment until
the termination thereof, and whether acquired by Employee before or
during the term of his employment; provided, however, that nothing
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herein shall be construed as requiring any such communication where
the method, development, invention and/or improvement is lawfully
protected from disclosure as the trade secret of a third party,
including,
without limitation, any former employer of Employee or by any other
lawful bar to such communication.
(c) Any methods, developments, inventions and/or
improvements, whether patentable or unpatentable, along the lines of
the business of Employer or any of its subsidiary companies, which
Employee may conceive of or make while in the employ of Employer,
shall be and remain the property of Employer. Employee agrees
promptly to communicate and disclose all such methods, developments,
inventions and/or improvements to Employer and to execute and deliver
to Employer any instruments deemed necessary by Employer to effect
disclosure and assignment thereof to it. Employee further agrees, on
request of Employer, to execute patent applications based on such
methods, developments, inventions and/or improvements, including any
other instruments deemed necessary by Employer for the prosecution of
such patent applications or the acquisition of Letters Patent in the
United States and/or any foreign countries.
(d) Employee agrees that for a period of three (3)
years from and after the termination or expiration of his employment
by Employer, whether pursuant to the terms of this Agreement or
otherwise, he will not:
(i) directly or indirectly solicit, raid, entice
or induce any employee of Employer or of any of its subsidiary
companies to be employed by any person, firm or
corporation which is, directly or indirectly, in competition with the
business or activities of Employer or any of its subsidiary companies;
or
(ii) directly or indirectly approach any such
employee for these purposes; or
(iii) authorize or knowingly approve the taking of
such actions by other persons on behalf of any such person, firm or
corporation, or assist any such person, firm or corporation in taking
such action; or
(iv) directly or indirectly solicit, raid, entice
or induce any person, firm or corporation (other than the U.S.
Government or its agencies) who or which on the date hereof is, or at
any time during the period of employment hereunder shall be, a
customer of Employer or of any of its subsidiary companies to become a
customer for the same or similar products which it purchased from
Employer or any of its subsidiary companies, of any other person, firm
or corporation, and Employee shall not approach any such customer for
such purpose or authorize or knowingly approve the taking of such
actions by any other person.
(e) Employee agrees that during the term of his
employment by Employer, whether under this Agreement or otherwise, he
will not at any time enter into, on behalf of Employer or any of its
subsidiary companies, or cause Employer or
any of its subsidiary companies to enter into, directly or indirectly,
any transactions with any business organization in which he or any
member of his immediate family may be interested as a partner,
trustee, director, officer, employee, shareholder, lender of money or
guarantor.
7. Injunctive Relief. Employee acknowledges that the
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services to be rendered by him hereunder are of a special, unique and
extraordinary character and that it would be very difficult or
impossible to replace such services and further that irreparable
injury would be sustained by Employer and its subsidiary companies in
the event of a violation by Employee of any of the provisions of this
Agreement, and by reason thereof Employee consents and agrees that if
he violates any of the provisions of this Agreement, Employer shall be
entitled to an injunction to be issued by any court of competent
jurisdiction restraining him from committing or continuing any
violation of this Agreement.
8. Survival of Provisions. The provisions of Sections 5, 6
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and 7 hereof shall survive the termination or expiration of this
Agreement, irrespective of the reason therefor.
9. Expenses. Employer shall reimburse Employee for all
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reasonable expenses properly incurred by him on behalf of Employer in
the performance of his duties hereunder, provided that proper vouchers
are submitted to Employer by Employee
evidencing such expenses and the purposes for which the same were
incurred.
10. Disability. If Employee shall be incapacitated by
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reason of mental or physical disability or otherwise during the term
of this Agreement so that he is prevented from performing his
principal duties and services hereunder for a period of three (3)
consecutive months or one or more periods aggregating three (3) months
during any twelve (12) month period, Employer shall have the right to
terminate this Agreement by sending written notice of termination to
Employee, and thereupon his employment pursuant to this Agreement
shall terminate and Employee shall be entitled to no further payments
hereunder, other than (i) for any compensation due pursuant to Section
4 hereof through the date of such termination, (ii) the reimbursement,
pursuant to Section 9 hereof, of any expenses incurred prior to the
date of such termination, and (iii) the continuation of Employee's
base salary pursuant to Section 4(a) hereof for a period of six (6)
months from the date of such termination, but not beyond the
Termination Date or the date on which Employee shall commence to
receive benefits pursuant to Employer's long term disability plan, as
then in effect.
11. Death. In the event of the death of Employee during
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the term hereof, this Agreement shall automatically terminate and
Employer shall have no further obligations
hereunder, other than to pay to Employee's estate any compensation due
pursuant to Section 4 hereof through the date of such termination and
to reimburse, pursuant to Section 9 hereof, any expenses incurred by
Employee through the date of such termination.
12. Termination by Employer for Cause. Employer shall have
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the right to terminate the employment of Employee under this Agreement
as well as any and all payments to be made hereunder, other than for
any compensation due pursuant to Section 4 hereof through the date of
such termination and any reimbursement, pursuant to Section 9 hereof,
of expenses incurred by Employee through the date of such termination,
if Employee shall commit any of the following acts of default:
(i) Employee shall have committed any material
breach of any of the provisions or covenants set forth herein; or
(ii) Employee shall have committed any act of
gross negligence in the performance of his duties or obligations
hereunder; or
(iii) Employee shall have committed any material
act of dishonesty or breach of trust against Employer or any of its
subsidiary companies; or
(iv) Employee's conviction of, or plea of nolo
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contendere to, a felony.
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If Employer elects to terminate this Agreement as set forth
above, Employer shall send written notice to Employee terminating this
Agreement and describing the action of Employee constituting the act
of default, and thereupon no further payments of any type shall be
made or shall be payable to Employee hereunder notwithstanding any
other provisions of this Agreement, except as set forth in the first
sentence of this Section 12.
13. No Conflicting Agreements. Employee represents and
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warrants that he is not a party to any agreement, contract or
understanding, whether employment or otherwise, which would in any way
restrict or prohibit him from undertaking or performing employment in
accordance with the terms and conditions of this Agreement.
14. Entire Agreement. This Agreement sets forth the entire
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understanding of the parties with respect to the subject matter
hereof, and no statement, representation, warranty or covenant has
been made by either party except as expressly set forth herein. This
Agreement shall not be changed or terminated orally. This Agreement
supersedes and cancels all prior agreements between the parties,
whether written or oral, relating to the employment of Employee.
15. Applicable Law. This Agreement shall be governed by,
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construed and enforced in accordance with the laws of the
State of New York, without regard to its conflict of laws principles.
16. Notices. All notices, requests, demands and other
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communications hereunder shall be in writing and shall be deemed to
have been duly given if personally delivered, telecopied or mailed,
first class, postage prepaid, certified mail, return receipt
requested, to each of the parties at its or his address above written
or as set forth beneath their signatures below or at such other
address or telecopy number as either of the parties may designate in
conformity with the foregoing.
17. Section Headings. The section headings set forth in
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this Agreement are for convenience only and shall not be considered as
part of this Agreement in any respect nor shall they in any way affect
the substance of any provisions contained in this Agreement.
18. Successors and Assigns. This Agreement shall not be
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assignable by Employee. All of the terms and provisions of this
Agreement shall be binding upon and inure to the benefit of and be
enforceable by the respective heirs and personal representatives of
Employee and the successors and assigns of Employer.
19. Severability. If, at any time subsequent to the date
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hereof, any provision of this Agreement shall be held by any court of
competent jurisdiction to be illegal, void or
unenforceable, such provision shall be of no force and effect, but the
illegality or unenforceability of such provision shall have no effect
upon and shall not impair the enforceability of any other provisions
of this Agreement.
IN WITNESS WHEREOF, the parties hereto have duly executed
this Agreement as of the day and year first above written.
UNITED INDUSTRIAL CORPORATION
By:
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Name: Howard M. Bloch
Title: Vice President
Telecopy No: (212) 838-4629
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P. DAVID BOCKSCH
Telecopy No: (201) 444-6355
EXHIBIT A
United Industrial Corporation
18 East 48th Street
New York, New York 10017
(212) 752-8787
Fax: (212) 838-4629
March 27, 1995
Mr. P. David Bocksch
90 Ardmore Road
Ho-Ho-Kus, New Jersey 07423
Re: Grant of Incentive Stock Option
Dear Mr. Bocksch:
On May 10, 1994, the Stockholders of United Industrial
Corporation (the "Company") authorized and approved the 1994 Stock
Option Plan, which was previously adopted by the Board of Directors.
The 1994 Stock Option Plan (the "Plan") provides for the grant of
options to certain key employees of the Company and its subsidiaries.
A copy of the Plan is annexed hereto and shall be deemed a part hereof
as if fully set forth herein. Unless the context otherwise requires,
all terms defined in the Plan shall have the same meaning when used
herein.
The Company hereby grants to you, as a matter of separate
inducement and not in lieu of any salary or other compensation for
your services, the option (the "Option") to purchase, in accordance
with the terms and conditions set forth in the Plan, but subject to
the limitations set forth herein and in the Plan, an aggregate of
100,000 Shares of Common Stock, $1.00 par value per share, of the
Company at a price of $ per share, such option price being, in the
judgment of the Option Committee, not less than one hundred percent
(100%) of the fair market value of such share at the date hereof. The
Option is intended to qualify as an "incentive stock option" within
the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended, but it is specifically understood that no warranty is made to
you as to such qualification.
Subject to the provisions and limitations of Sections 6 and 7 of
the Plan, this Option may be exercised by you, on a cumulative basis,
during a period often (10) years commencing on the date of grant of
this Option and terminating at the close of business on March 27,
2005, as follows:
(a) up to one third (1/3) of the total number of shares subject
to this Option may be purchased by you commencing one year after the
date hereof;
(b) up to an additional one third (1/3) of the total number of
shares subject to this Option may be purchased by you commencing two
years after the date hereof; and
(c) the balance of the total number of shares subject to this
Option may be purchased by you commencing three years after the date
hereof.
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The unexercised portion of the Option granted herein will
automatically and without notice terminate and become null and void
upon the expiration of ten (10) years from the date of the grant of
this Option. If, however, prior to the expiration of ten (10) years
from the date of grant of this Option, your employment with the
Company and any parent or subsidiary corporation terminates this
Option will terminate on the applicable date as described below;
provided, however, that none of the events described below shall
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extend the period of exercisability of this option beyond ten (10)
years from the date of grant of this Option;
(a) the date of termination, if your employment is terminated
other than by reason of death, disability, retirement, good reason or
dismissal other than for cause (as such terms are defined in the
Plan);
(b) the expiration of one (1) year after your death if your
death occurs either during your employment or within the one-year or
three-month period after the termination of your employment specified
in clauses (c) and (d) below, except that your Option will be
exercisable during such one-year period only to the extent that it
would have been exercisable on the date of your death;
(c) the expiration of one (1) year after the termination of your
employment by reason of your disability (as defIned in the Plan),
except that your Option will be exercisable during such one-year
period only to the extent that it would have been exercisable
immediately prior to the termination of your employment; and
(d) the expiration of three (3) months from the date of
termination of your employment by reason of your retirement, good
reason (as defined in the Plan) or dismissal other than for cause (as
defined in the Plan), except that your Option will be exercisable
during such three-month period only to the extent that it would have
been exercisable immediately prior to the termination of your
employment.
In no event shall you exercise this Option for a fraction of a
share or for less than one hundred (100) shares (unless the number
purchased is the total balance for which the Option is then
exercisable).
This Option is not transferable by you otherwise than by will or
the laws of descent and distribution, and is exercisable, during your
lifetime, only by you. This Option may not be assigned, transferred
(except by will or the laws of descent and distribution), pledged or
hypothecated in any way (whether by operation of law or otherwise) and
shall not be subject to execution, attachment or similar proceeding.
Any attempted assignment, transfer, pledge, hypothecation or other
disposition of this Option contrary to the provisions hereof, and the
levy of any attachment or similar proceeding upon the Option, shall be
null and void and without effect.
Any exercise of this Option shall be in writing addressed to the
Corporate Secretary of the Company at the principal place of business
of the Company, shall be substantially in the form attached hereto and
shall be accompanied by a certified or bank cashier's check to the
order of the Company in the full amount of the purchase price of the
shares so purchased.
If the Company, in its sole discretion, shall determine that it
is necessary, to comply with applicable securities laws, the
certificate or certificates representing the shares purchased pursuant
to the exercise of this Option shall bear an appropriate legend in
form and substance, as determined by the Company, giving notice of
applicable restrictions on transfer under or in respect of such laws.
You hereby covenant and agree with the Company that if, at the
time of exercise of this Option, there does not exist a Registration
Statement on an appropriate form under the Securities Act of 1933, as
amended (the "Act"), which Registration Statement shall have become
effective and shall include a prospectus which is current with respect
to the shares subject to this Option (i) that you are purchasing the
shares for your own
account and not with a view to the resale or distribution thereof and
(ii) that any subsequent offer for sale or sale of any such shares
shall be made either pursuant to (x) a Registration Statement on an
appropriate form under the Act, which Registration Statement shall
have become effective and shall be current with respect to the shares
being offered and sold, or (y) a specific exemption from the
registration requirements of the Act, but in claiming such exemption,
you shall, prior to any offer for sale or sale of such shares, obtain
a favorable written opinion from counsel for or approved by the
Company as to the applicability of such exemption.
As provided in the Plan, the Company may withhold from sums due
or to become due to you from the Company an amount necessary to
satisfy its obligation to withhold taxes incurred by reason of the
disposition of the shares acquired by exercise of this Option in a
disqualifying disposition (within the meaning of Section 421(b) of the
Code), or may require you to reimburse the Company in such amount.
The Company may hold the stock certificate to which you are entitled
upon the exercise of this Option as security for the payment of
withholding tax liability, until cash sufficient to pay such liability
has been accumulated.
You agree that for a period of three (3) years from and after the
termination or expiration of your employment by the Company, you will
not:
(i) directly or indirectly solicit, entice or induce any
employee of the Company or of any of its subsidiary or affiliated
companies to be employed by any person, firm or corporation which is,
directly or indirectly, in competition with the business or activities
of the Company or any of its subsidiary or affiliated companies; or
(ii) directly or indirectly approach any such employee for these
purposes; or
(iii) authorize or knowingly approve the taking of such
actions by other persons on behalf of any such person, firm or
corporation, or assist any such person, firm or corporation in taking
such action; or
(iv) directly or indirectly solicit, raid, entice or induce any
person, firm or corporation (other than the US Government or its
agencies) who or which on the date hereof is, or at any time during
the period hereunder shall be, a customer of the Company or of any of
its subsidiary or affiliated companies to become a customer for the
same or similar products which it purchased from the Company or any of
its subsidiary or affiliated companies, of any other person, firm or
corporation, and you shall not approach any such customer for such
purpose or authorize or knowingly approve the taking of such actions
by any other person.
You further agree that you will not divulge, furnish or make
available to anyone at anytime, except as part of your employment by
the Company or any of its subsidiary or affiliated Companies either
during or subsequent to much employment, any knowledge or information
with respect to confidential or proprietary information, methods,
processes, plans or materials of the Company or any of its subsidiary
or affiliated companies, or with respect to any other confidential or
proprietary aspects of the business of the Company or any of its
subsidiary or affiliated companies.
This agreement is subject to all terms, conditions, limitations
and restrictions contained in the Plan, which shall be controlling in
the event of any conflicting or inconsistent provisions.
Please indicate your acceptance of all the terms and conditions
of this Option and the Plan by signing and returning a copy of this
letter.
Very truly yours,
UNITED INDUSTRIAL CORPORATION
By:
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Howard M. Bloch, Vice President
ACCEPTED:
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Signature of Employee
P David Bocksch
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Name of Employee
Date: March 27, 1995
HMB/dc