EMPLOYMENT AGREEMENT
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Vito W. Lenoci
EMPLOYMENT AGREEMENT dated as of November 1, 1991, between REEVES BROTHERS,
INC., a Delaware corporation having its principal place of business at Highway
29 South, Post Office Box 1898, Spartanburg, S.C. 29304 (the "Employer") and
Vito W. Lenoci residing at 99 Stratford Road, Asheville, N.C. 28804 (the
"Employee").
WHEREAS, the Employer desires to obtain the services of the Employee on the
terms and conditions hereinafter stated, and the Employee is willing to furnish
his services on such terms and conditions;
NOW, THEREFORE, the parties agree as follows:
1. EMPLOYMENT. The Employer hereby employs the Employee in the position
designated in Paragraph 6, and the Employee hereby accepts such employment on
the terms and conditions hereinafter set forth.
2. TERM. Subject to the provisions for earlier termination as
hereinafter provided in Paragraph 7 of this Agreement, the term of this
Agreement shall be five (5) years, unless extended as set forth below,
commencing on November 1, 1991 and ending October 31, 1996. The Term of this
Agreement shall be automatically extended for two one-year periods unless on or
before a date 120 days prior to the end of the original termination date, or any
subsequent termination date, the Employer or Employee provides written notice to
the other party that they do not intend to extend the Agreement.
3. COMPENSATION. For all services rendered by the Employee under this
Agreement and for the agreements of the Employee contained in Paragraphs 8 and
9, the Employer shall during the Employment Term compensate the Employee as
follows:
(a) BASE SALARY. The Employer shall during the Employment Term pay
the Employee a base salary of $229,000 per year, payable in equal semi-monthly
installments on the fifteenth and last days of each month. Such Base Salary
shall be subject to adjustments pursuant to the Employer's salary administration
program.
(b) INCENTIVE COMPENSATION. In addition to the foregoing base
salary, the Employee shall receive additional compensation as provided under the
Employer's Management Incentive Bonus Plan of the Employer for its Corporate and
Divisional Officers, as in effect from time to time pursuant to
resolutions adopted by the Board of Directors of the Employer, or any successor
thereto.
4. EXPENSES. The Employee shall be entitled to receive reimbursement for
reasonable out-of-pocket expenses incurred in connection with the performance of
the Employee's duties hereunder upon presentation from time to time of itemized
accounts of, and customary receipts for, such expenses.
5. BENEFITS. During the Employment Term, the Employee shall receive
benefits as described in Exhibit A hereto and such other general and specific
benefits which shall not be less than those generally provided to Employees in
the position and status of Employee by the Employer on November 1, 1991. The
Employee shall be furnished office space, working facilities, secretarial and
other services and facilities suitable to his position and adequate for the
performance of his duties. The Employee shall be entitled each year during the
Employment Term to a vacation of four weeks, during which time his compensation
will be paid in full.
6. DUTIES. The Employee shall be employed as President and Chief
Executive Officer of the Industrial Coated Fabrics Division of the Employer and
in such capacity as may be determined by the Board of Directors of Employer, and
shall have the authority and powers to perform all duties as are customary to
such offices, subject to the control and direction of the Board of Directors of
the Employer. The Employee shall also serve as a director of the Employer,
Reeves Industries, Inc. ("Reeves Industries") and any of their respective
subsidiaries, if elected by the shareholders or appointed by the Board of
Directors of the particular corporation. The Employee agrees to use his best
efforts, skill and experience in connection with his employment, shall devote
faithful service, including substantially all of his business time and
attention, to such employment and shall not engage in any activity of any nature
whatsoever which would in any way materially interfere with his so devoting his
service, business time and attention to his duties hereunder.
7. TERMINATION OF EMPLOYMENT PRIOR TO EXPIRATION OF THE EMPLOYMENT TERM.
This Agreement may be terminated prior to the end of the Employment Term, as set
forth below.
(a) DEATH. In the event of the Employee's death during the Employment
Term, all of the obligations of the Employer hereunder shall be terminated as of
the last day of the month in which death occurs, except that Employer shall pay
to the Employee's estate for one year from the date of death, the Base Salary
payable to the Employee pursuant to Paragraph 3(a) hereof (as the same may have
been adjusted from time to time).
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(b) DISABILITY. In the event that the Employee shall be unable to perform
his duties during the Employment Term by reason of any adjudicated incompetency
or permanent disability, the Employer may, on thirty (30) days' written notice,
terminate this Agreement. Permanent disability shall have the meaning set forth
in the definition of total permanent disability (or such term having similar
import) contained in any disability insurance policy purchased by the Employer
to cover the Employee and an Employee shall be considered permanently disabled
for purposes of this Agreement when so considered by the insurance company
obligated under such policy. In addition, regardless of whether any such policy
is in force at the applicable time, permanent disability shall mean the
inability of an Employee due to accident or illness to perform full time active
services on behalf of the Employer (x) for a continuous one-year period or (y)
if a medical doctor shall certify to the satisfaction of the Board of Directors
of the Employer that such inability shall continue for at least one year after
the date of such accident or illness. In the event of such termination by
reason of the Employee's illness or incapacity, the Employer shall pay to the
Employee or the Employee's estate for the shorter of (i) 215 days from the date
of termination or (ii) the remainder of the Employment Term, the Base Salary
payable to the Employee pursuant to Paragraph 3(a) hereof (as the same may have
been adjusted from time to time). Any payment hereunder may be funded by the
Employer through disability insurance paid for by the Employer.
(c) ACTS NOT IN THE BEST INTERESTS OF THE EMPLOYER. The Employer shall
have the right to terminate this Agreement upon a finding by the Employer's
Board of Directors that the Employee has acted in a manner which is not in the
best interests of the Employer. In the event of such termination by reason of
the Employee's acting in a manner which is not in the best interests of the
Employer, the Employee shall receive no compensation or benefits (except as
required by law) after the date of termination.
(d) RIGHT OF THE EMPLOYER TO TERMINATE FOR OTHER REASONS. The Employer
shall have the right to terminate this Agreement for any other reason in
addition to those specified in subparagraphs (a), (b) and (c) of this Paragraph
7 upon the giving of sixty (60) days' written notice to the Employee. In the
event of such termination by the Employer other than pursuant to subparagraphs
(a), (b) and (c) of this Paragraph 7, the Employer shall pay to the Employee or
the Employee's estate for the remainder of the Employment Term, the Base Salary
payable to the Employee pursuant to Paragraph 3(a) hereof (as the same may have
been adjusted from time to time), reduced by an amount equal to any compensation
received during such remainder of the Employment Term, as the case may be, by
the Employee in connection with any new employment.
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(e) RIGHT OF THE EMPLOYEE TO TERMINATE THIS AGREEMENT. Subject to the
provisions of paragraph 8 hereof, the Employee shall have the right to terminate
this Agreement for any reason upon the giving of sixty (60) days' written notice
to the Employer. In the event of such termination by the Employee, the Employee
shall be entitled to no further compensation or benefits (except as required by
law) under this Agreement after the date of termination.
8. RESTRICTIVE COVENANTS. During the Employment Term the Employee shall
not directly or indirectly own, manage, operate, control, be employed by,
participate in, or be connected in any manner with the ownership, management,
operation or control of any business other than the Employer or Reeves
Industries and their respective subsidiaries. The Employee may, without being
deemed to violate any provision hereof, serve during the Employment Term on the
boards of banks, charitable, civic or social organizations and acquire not more
than five percent (5%) of the outstanding shares of publicly-held corporations.
Notwithstanding anything to the contrary herein contained, the ownership,
management, control or operation of, employment by, participation in, or any
other connection with the ownership, management, operation or control of any
business by any member of the Employee's family shall not be deemed to cause
Employee to be in violation of any provision hereof. During a period of one
year following termination of Employee's employment under this Agreement, the
Employee shall not (i) directly or indirectly, as employee, officer, director,
stockholder, partner or otherwise, own, manage, operate, control, be employed
by, participate in, or be connected in any manner with, the ownership,
management, operation or control of any business or enterprise which is in
competition with any business carried on, or in active contemplation of being
carried on, by the Employer, Reeves Industries or any of their subsidiaries or
affiliates at such time; provided, however, that ownership of not more than five
percent (5%) of the outstanding shares of a publicly-held corporation shall not
be deemed to violate any provision hereof; (ii) directly or indirectly employ,
retain or negotiate with respect to employment or retention of any person whom
the Employer, Reeves Industries, or any of their subsidiaries or affiliates has
employed or retained; or (iii) directly or indirectly sell, offer to sell, or
negotiate with respect to orders or contracts for, any product or service
similar to a product or service now sold or offered by the Employer, Reeves
Industries, or any of their subsidiaries or affiliates to or with anyone with
whom the Employer, Reeves Industries, or any of their subsidiaries or affiliates
has so dealt. In connection with the foregoing restrictive covenant, Employer
shall continue to pay Employee the Base Salary payable to Employee pursuant to
paragraph 3(a) (as the same may have been adjusted from time to time).
Notwithstanding anything in the foregoing to the contrary, the aforesaid
restrictions on the Employee shall not apply for periods after termination of
employment if the
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Employee's termination resulted from wrongful discharge by the Employer or from
the Employee's resignation by reason of the Employer's material wrongful act or
material violation of this Agreement, provided that the Employer has not cured
such wrongful discharge, wrongful act or wrongful violation within thirty (30)
days after notice thereof by the Employee. The restrictive covenants of this
paragraph shall apply for one year after termination of employment without
payment of any compensation if Employee terminates his employment pursuant to
paragraph 7(e) or if Employee is terminated pursuant to paragraph 7(c). In the
event of an actual or threatened breach by the Employee of the provisions of
this paragraph, the Employer shall be entitled to an injunction restraining the
Employee from owning, managing, operating, controlling, being employed by,
participating in, or being in any way so connected with any such business or
from soliciting employees or customers of the Employer as herein provided.
Nothing herein stated shall be construed as prohibiting the Employer from
pursuing any other remedies available to the Employer for such breach or
threatened breach, including the recovery of damages from the Employee.
9. DISCLOSURE OF INFORMATION. The Employee recognizes and acknowledges
that the lists of the Employer's customers, suppliers, formulas, processes and
other confidential information (collectively "Confidential Information") as they
may exist from time to time, are valuable, special, and unique assets of the
Employer's business. The Employee agrees that he will not, during or at any
time after the Employment Term, intentionally disclose any Confidential
Information, to any person, firm, corporation, association or other entity for
any reason or purpose whatsoever, except as may be authorized by the Employer's
Board of Directors. In the event of a breach or threatened breach by the
Employee of the provisions of this paragraph, the Employer shall be entitled to
an injunction restraining the Employee from disclosing, in whole or in part, any
Confidential Information, or from rendering any services to any person, firm,
corporation, association or other entity to whom such Confidential Information,
in whole or in part, has been disclosed or is threatened to be disclosed.
Nothing herein shall be construed as prohibiting the Employer from pursuing any
other remedies available to the Employer for such breach or threatened breach,
including the recovery of damages from the Employee.
10. NOTICES. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and if sent by registered mail to
the addresses of the parties set forth above or to such other addresses as may
subsequently be furnished in writing by one party to the other.
11. WAIVERS. The waiver by either party hereto of any breach or
requirement of any provision of this Agreement by the other party shall not
operate or be construed as a waiver of any
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subsequent breach or requirement by such party, whether similar or different.
12. ASSIGNMENT. The rights and obligations of the Employer under this
Agreement shall inure to the benefit of and shall be binding upon the successors
and assigns of the Employer. In the event of merger, consolidation or
liquidation of the Employer, or in the event of a sale or transfer of
substantially all the operating assets of the Employer to any other person,
firm, corporation, association or other entity, the provisions hereof shall
inure to the benefit of, and be binding upon, the surviving corporation or such
purchaser or transferee, as the case may be. Any assignment of this Agreement
by the Employer shall not relieve or release the Employer from any of its
obligations set forth herein.
13. ENTIRE AGREEMENT. This Agreement contains the entire agreement of the
parties with respect to the subject matter hereof, and all prior and other
agreements between them, oral or written, concerning the same subject matter are
merged into this Agreement. Any prior agreement relating to the employment of
Employee by Employer is terminated as of the effective date hereof.
14. AMENDMENTS. This Agreement may not be amended or modified except by a
writing executed by the Employer and the Employee.
15. GOVERNING LAW. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of North Carolina.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
day and year first above written.
REEVES BROTHERS, INC.
By:_______________________________
__________________________________
Employee: Vito W. Lenoci
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Exhibit A to
Employment Agreement
of Vito W. Lenoci
ADDITIONAL FRINGE BENEFITS
1. Supplemental Executive Retirement Plan (SERP for 401(A)(17))
2. Annual Physical
3. Medical Reimbursements
4. Spouse Travel on Selected Business Trips
5. Financial and Tax Planning Costs up to $5,000, including taxes
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