Exhibit 10(p)
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, made and entered into as of the 17th_day of
July 1996, by and between QUAKER CHEMICAL CORPORATION, a Pennsylvania
corporation (hereinafter referred to as "QUAKER"), and JOSEPH F. VIRDONE
(hereinafter referred to as "VIRDONE").
W I T N E S S E T H:
WHEREAS, QUAKER wishes to employ VIRDONE, and VIRDONE wishes to be
employed by QUAKER.
NOW, THEREFORE, in consideration of the mutual promises and covenants
herein contained, and intending to be legally bound hereby, the parties hereto
agree as follows:
1. QUAKER agrees to employ VIRDONE, and VIRDONE agrees to serve as Vice
President, U.S. Commercial Operations of QUAKER. He shall perform all duties
consistent with such position as well as any other duties which are assigned
to him from time to time by the Board of Directors or President of QUAKER.
VIRDONE covenants and agrees that he will, during the term of this Employment
Agreement or any extension or renewal thereof, devote his knowledge, skill,
and working time solely and exclusively to the business and interests of
QUAKER.
2. The term of VIRDONE's employment shall continue until December 31,
1996 and continuing thereafter until either party hereto shall have given the
other at least ninety (90) days' written notice of a desire to terminate.
3. QUAKER shall pay to VIRDONE and VIRDONE shall accept an annual rate
of salary as set forth in Exhibit A attached hereto, payable semi-monthly,
during the term of this Employment Agreement or any extension or renewal
thereof.
4. VIRDONE shall participate in such QUAKER Incentive Programs as
described and set forth in Exhibit A. As an Officer of QUAKER, the
particulars of Exhibit A may be amended by the Board of Directors at any time
as to any matter set forth therein including rate of annual salary,
eligibility to participate in any given QUAKER incentive plan, the level of
participation in any QUAKER incentive plan, and the terms and conditions of
any QUAKER incentive plan. Any changes to Exhibit A shall not affect any of
the other terms and conditions hereof including, without limitation, the
provisions of Paragraphs 7 through 9. For the purposes of this Agreement, the
term "QUAKER Incentive Program" shall refer to each individual as well as the
combined incentive programs approved by the Board of Directors. Revisions to
Exhibit A shall become effective upon notification in writing by QUAKER and
VIRDONE's acceptance by his signature on the notification.
5. (a) With respect to Quaker's Long-Term Performance Incentive Plan
(the "Incentive Plan"), VIRDONE shall be eligible to participate in the
1995-1998 performance award period under the terms and conditions of the
Incentive Plan. In connection therewith, he has been granted Stock Options
to purchase 5,000 shares (to be priced as of the close of business July 17,
1996). He is also eligible for an award of 7,000 performance units.
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(b) VIRDONE shall be entitled to his current vacation eligibility,
paid holidays, and such other employee benefits, including insurance, medical
benefits, profit sharing, and retirement benefits as are made generally
available to all QUAKER employees. In addition, VIRDONE shall be eligible to
participate in Quaker's Supplemental Retirement Income Program.
(c) QUAKER shall reimburse VIRDONE for all reasonable expenses
incurred by VIRDONE on behalf of QUAKER in the course of VIRDONE's employment
under this Employment Agreement, provided that such expenses shall have been
approved by QUAKER in accordance with such expense reimbursement procedures as
shall be adopted by QUAKER.
6. In the event of the death of VIRDONE while this Employment Agreement
is in effect and as to which no notice of termination has been given by either
party, QUAKER shall (i) continue to pay a sum of money equal to the salary
that would have been paid to him for four months following his death just as
if he were living, and (ii) QUAKER shall pay a death benefit equal to his then
current annual salary plus $30,000 to be paid in three equal payments, without
interest, on the 16, 28, and 40 month anniversary of the date of his death.
Payments made pursuant to this Paragraph 6 shall be made to the person or
persons who may be designated by VIRDONE, in writing, and, in the event he
fails to so designate to whom payments shall be made, payments shall be made
to VIRDONE's personal representatives.
7. VIRDONE acknowledges that information concerning the method and
conduct of QUAKER's (and any affiliates') business, including, without
limitation, strategic and marketing plans, budgets, corporate practices and
procedures, financial statements, customer and supplier information, formulae,
formulation information, application technology, manufacturing information,
and laboratory test methods and all of QUAKER's (and any affiliates') manuals,
documents, notes, letters, records, and computer programs are QUAKER's (and/or
QUAKER's affiliates', as the case may be) trade secrets ("Trade Secrets") and
are the sole and exclusive property of QUAKER (and/or QUAKER's affiliates, as
the case may be). VIRDONE agrees that at no time during or following his
employment with QUAKER will he use, divulge, or pass on, directly or through
any other individual or entity, any Trade Secrets. Upon termination of
VIRDONE'S employment with QUAKER, or at any other time upon QUAKER's request,
VIRDONE agrees to forthwith surrender to QUAKER any and all materials in his
possession or control which include or contain any such Trade Secrets. The
words "Trade Secrets" do not include information already known to the public
through no act or failure to act on the part of VIRDONE, required by law to be
disclosed, or which can be clearly shown to have been known by VIRDONE prior
to the commencement of his employment with QUAKER.
8. VIRDONE agrees that during his employment and for a period of one
(1) year thereafter, regardless of the reason for the termination of VIRDONE's
employment hereunder, he will not:
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(a) directly or indirectly, together or separately or with any
third party, whether as an individual proprietor, partner, stockholder,
officer, director, joint venturer, investor, or in any other capacity
whatsoever engage in business or assist anyone or any firm in business as a
manufacturer, seller, or distributor of specialty chemical products or
chemical management services which are the same, like, similar to, or which
compete with the products and services offered by QUAKER (or any of its
affiliates);
(b) recruit or solicit any employee of QUAKER or otherwise induce
such employee to leave the employ of QUAKER or to become an employee or
otherwise be associated with his or any firm, corporation, business or other
entity with which he is or may become associated; and
(c) solicit, directly or indirectly, for himself or as agent or
employee of any person, partnership, corporation, or other
entity (other than for QUAKER) any then or former customer,
supplier, or client of QUAKER.
VIRDONE acknowledges and agrees that all of the foregoing
restrictions are reasonable as to the period of time and scope. However, if
any paragraph, sentence, clause, or other provision is held invalid or
unenforceable by a court of competent and relevant jurisdiction, such
provision shall be deemed to be modified in a manner consistent with the
intent of such original provision so as to make it valid and enforceable, and
this Agreement and the application of such provision to persons and
circumstances other than those with respect to which it would be invalid or
unenforceable shall not be affected thereby. VIRDONE agrees and recognizes
that in the event of a breach or threatened breach of the provisions of the
restrictive covenants contained in Paragraph 7 or in this Paragraph 8, QUAKER
may suffer irreparable harm, and monetary damages may not be an adequate
remedy. Therefore, if any breach occurs or is threatened, in addition to all
other remedies available to QUAKER at law or in equity, Quaker shall be
entitled as a matter of right to specific performance of the covenants of
Quaker contained herein by way of temporary or permanent injunctive relief.
In the event of any breach of the restrictive covenant contained in this
Paragraph 8, the term of the restrictive covenant specified herein shall be
extended by a period of time equal to that period beginning on the date such
violation commenced and ending when the activities constituting such violation
cease.
9. (a) Definitions. For the purposes of this agreement, the following
definitions shall apply and will be used:
(i) "Act" means the Securities Exchange Act of 1934, as
amended;
(ii) "QUAKER's Common Stock" means shares of Common Stock,
$1.00 par value, of QUAKER;
(iii) "Termination for Cause" means VIRDONE's employment
with QUAKER shall have been terminated by QUAKER by reason of either:
(1) The willful and continued failure by VIRDONE to
execute his duties under this Employment Agreement; or
(2) The willful engaging by VIRDONE in a continued
course of misconduct which is materially injurious to QUAKER, monetarily or
otherwise.
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VIRDONE shall have been given notice thereof from QUAKER's
Board of Directors and an opportunity (with counsel) to be heard by said Board
of Directors, and the Board of Directors shall have made a reasonable and good
faith finding that VIRDONE was guilty of the conduct set forth in clause (1)
or (2) hereof.
(iv) "Termination for Good Reason" means VIRDONE's employment
with QUAKER shall have been terminated by VIRDONE by reason of a material
change announced or promulgated by QUAKER in the terms, conditions, duties,
compensation, or benefits of VIRDONE's employment with QUAKER and not agreed
to by VIRDONE.
(b) The purpose of this Paragraph 9 is to reinforce and encourage
the continued dedication and attention of VIRDONE to VIRDONE's assigned duties
under this Employment Agreement without distraction as a result of
circumstances which may arise from the possibility of a change of control or
an attempt to change the control of QUAKER.
(i) Upon the occurrence of a "First Event," QUAKER will
deposit in an escrow account at CoreStates Bank, N.A. (or such other bank as
QUAKER may hereafter designate) (the "Bank") an amount equal to VIRDONE's then
current annual salary for an eighteen (18) month period ("Termination Pay").
A First Event for the purposes of this Agreement shall mean any one of the
following events.
(1) Shares of QUAKER's Common Stock are acquired (other
than directly from QUAKER in exchange for cash or property) by any person (as
used in Sections 13 and 14 of the Act) other than a person who is a present
Officer or Director of QUAKER, who thereby becomes the beneficial owner (as
defined in Rule 13d-3 under the Act) of more than 10% of the issued and
outstanding shares of QUAKER's Common Stock.
(2) Any person, firm, or corporation (including a
shareholder of QUAKER) makes a tender offer or exchange offer for, or a
request or invitation for tenders or exchanges of, shares of QUAKER's Common
Stock.
(ii) If a "Second Event" shall occur and thereafter (but within
three (3) years after date of the occurrence of the First Event) VIRDONE's
employment with QUAKER shall terminate for a reason other than (1) VIRDONE's
death, (2) VIRDONE's normal retirement for age, (3) VIRDONE's physical or
mental disability in accordance with prevailing QUAKER policy, (4) by QUAKER
as a Termination for Cause, or (5) by VIRDONE other than as a Termination for
Good Reason, VIRDONE may demand that the Bank pay VIRDONE the Termination Pay
(the "Demand").
A "Second Event" for the purposes of this Agreement shall
mean any of the following events occurring after a First Event:
(1) A new Director of QUAKER is elected in an
election in which the acquirer of the shares or the offeror or the requester
voted, in person or by proxy, and such new Director was not nominated as a
candidate in a proxy statement forwarded to shareholders by QUAKER's
management prior to the occurrence of the First Event.
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(2) More than 20% of the issued and outstanding shares of
QUAKER's Common Stock are owned by one person (as used in Sections 13 and 14
of the Act) other than a person who is a present Officer or Director of
QUAKER.
(3) During any period of two (2) consecutive calendar
years, individuals who at the beginning of such period constitute QUAKER's
Board of Directors cease for any reason to constitute at least a majority
thereof, unless the election or the nomination for election by QUAKER's
shareholders of each new Director was approved by a vote of at least
two-thirds (2/3) of the Directors then still in office who were Directors at
the beginning of the two (2) year period.
(iii) After the receipt of the Demand, the Bank will pay
VIRDONE the Termination Pay in eighteen (18) equal consecutive monthly
installments, the first such installment to be paid within thirty (30) days
from the date of the demand. VIRDONE shall not be required to diminish the
amount of any payment to which he is entitled under this subparagraph (c) by
seeking other employment or otherwise, nor shall the amount of any payment
provided for in this subparagraph (c) be reduced by any compensation earned by
VIRDONE as the result of employment by another employer after the date of
termination.
(iv) QUAKER may withdraw the deposited Termination Pay if three
(3) years elapse from the date of deposit thereof and if no demand has been
made. If, prior to the expiration of said three (3) year period, there shall
occur another First Event, QUAKER will not be required to make an additional
deposit of Termination Pay, but the three (3) year period described herein
shall be deemed to commence on the date of the occurrence of the last such
First Event.
(v) QUAKER shall pay the usual and customary charges of the
Bank for acting as escrow agent. QUAKER will be entitled to the payment of
any and all interest and other income earned by the Bank through the
investment of the deposited Termination Pay. Said interest shall be paid to
QUAKER as earned. The escrow arrangement may be subject to the Bank's usual
rules and procedures, and QUAKER will indemnify the Bank against any loss or
liability for any action taken by it in good faith as escrow agent.
10. In the event that QUAKER, in its sole discretion and at any time
terminates this Agreement with VIRDONE (other than for Termination for Cause),
QUAKER agrees to provide VIRDONE with reasonable out-placement assistance and
a severance payment (contingent upon VIRDONE executing a form of release
satisfactory to Quaker) in an amount equal to three (3) months' salary
calculated at VIRDONE'S then current rate plus an additional one (1) month for
each additional year of employment up to a maximum of twelve (12) months'
compensation
11. Termination. This Employment Agreement also can be terminated at
any time by "Termination for Cause" or "Termination for Good Reason" as
defined in Paragraph 9.
12. VIRDONE represents and warrants to QUAKER that:
(a) there are no restrictions, agreements, or understandings
whatsoever to which VIRDONE is a party which would prevent or make unlawful
his execution of this Employment Agreement or his employment hereunder; and
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(b) his execution of this Employment Agreement and his employment
hereunder shall not constitute a breach of any contract, agreement, or
understanding, oral or written, to which he is a party or by which he is
bound.
13. This Employment Agreement contains all the agreements and
understandings between the parties hereto with respect to VIRDONE's employment
by QUAKER and supersedes all prior or contemporaneous agreements with respect
thereto and shall be binding upon and for the benefit of the parties hereto
and their respective personal representatives, successors, and assigns. This
Employment Agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Pennsylvania without regard to any conflict of
laws.
IN WITNESS WHEREOF, QUAKER has caused this Employment Agreement to be
signed by its President, thereunto duly authorized, and its corporate seal to
be hereunto affixed and attested by its Corporate Secretary, and VIRDONE has
hereunto set his hand and seal all as of the day and year first above written.
ATTEST: QUAKER CHEMICAL CORPORATION
[SEAL]
By:______________________________ ______________________________
Karl H. Spaeth Ronald J. Naples
Corporate Secretary President and Chief Executive Officer
WITNESS:
_________________________________ ______________________________
Joseph F. Virdone
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EMPLOYMENT AGREEMENT
EXHIBIT A
Effective: July 17, 1996
Name of Employee: Joseph F. Virdone
Address: 654 Creighton Road
Villanova, Pennsylvania 19085
Title: Vice President, U.S. Commercial Operations
Term of Employment: To December 31, 1996 and continuing thereafter until
either party gives ninety (90) days' written notice of
termination
Annual Rate of
Salary at
Starting Date: $140,000
Participation in Quaker Incentive Programs for 1996 Only:
Incentive Bonus Plan
Bonus will be based on the newly-adopted Incentive Bonus Plan
Business Unit - Corporation -- 41% of mid-point
Discretionary - 9% of mid-point
Incentive Award Amount - 50% of mid-point - $136,980
Long-Term Performance Incentive Plan 1995-1998
Type of stock options offered - Qualified and Non-Qualified Stock Options
Number of shares subject to option - 5,000
Performance Units - 7,000
Option price per share - Closing price on July 17, 1996
Participation under and subject to the terms of a Stock Option Agreement
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