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Exhibit 10.5
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, dated as of July 1, 1994 (the
"Agreement"), is by and between United States Can Company, a Delaware
corporation having its principal offices at 900 Commerce Drive, Oak Brook,
Illinois 60521 ("U.S. Can"), and Tony Bonadonna, an employee of U.S. Can (the
"Employee").
WHEREAS, the Employee has been or is being hired to serve as
the Vice President - Human Resources of U.S. Can; and
WHEREAS, U.S. Can desires to retain the Employee's services,
and the Employee is willing to enter into and/or continue his employment as an
employee of U.S. Can on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing, the mutual
covenants and conditions contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:
1. EMPLOYMENT. The Employee shall be employed by U.S.
Can as Vice President - Human Resources for the Term of Employment (as defined
in Section 5 hereof), and on the terms and conditions set forth herein.
2. DUTIES. The Employee shall perform those duties
normally associated with the position of Vice President - Human Resources, as
well as any other duties and tasks as may be assigned from time to time to the
Employee by the Chief Executive Officer of U.S. Can. During the Term of
Employment, the Employee shall work exclusively for U.S. Can and its
Affiliates (as hereinafter defined) and devote substantially all his business
efforts and time to fulfill the duties of his employment.
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For purposes of this Agreement, the term "Affiliate" shall
mean U.S. Can, any other corporation owned or controlled by U.S. Can, directly
or indirectly, and any parent or subsidiary of U.S. Can, including, without
limitation, U.S. Can Corporation, a Delaware corporation.
3. SITE OF EMPLOYMENT. During the Term of Employment,
Employee's regular place of employment shall be U.S. Can's principal offices
located at 900 Commerce Drive, Oak Brook, Illinois 60521, or such other place
as the Chief Executive Officer may direct.
4. COMPENSATION AND BENEFITS.
A. SALARY. In full consideration for the
aforementioned services and subject to the due
performance thereof, the Employee shall receive an
annual base salary of $155,000 (payable bi-monthly in
arrears) during the Term of Employment; provided,
however, that the Employee shall receive only a pro
rata share of such salary through the date of
termination or resignation in the event the Employee
is terminated for cause by U.S. Can pursuant to
Section 6(i) or in the event the Employee voluntarily
resigns pursuant to Section 6(iii) hereof. U.S. Can
shall calculate any pro rata share of the Employee's
salary earned through the date of termination or
resignation, including accrued but unused vacation
time. In the event the Employee is terminated by
U.S. Can without cause pursuant to Section 6(ii)
below, the Employee shall be entitled to receive his
Severance Payments pursuant to Section 7 hereof;
provided, however, that in the event the Employee is
terminated without cause due to a disability in
accordance with Section 8 hereof, U.S. Can shall
only be obligated to the Employee for the difference
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between the Severance Payments and any other amounts
received by the Employee as a result of such
disability, including but not limited to amounts
received pursuant to any disability insurance plan
provided by U.S. Can, worker's compensation payments
and any compensatory or punitive damage awards
received in any personal injury action. Any increase
in base salary, or the award of any bonus, shall be
made in the sole discretion of the Board of Directors
of U.S. Can, taking into account, in their sole
discretion, whether the Employee has attained the
performance goals, financial and otherwise,
established for the Employee by the Board of
Directors for the preceding year. Notwithstanding
the foregoing, the Employee shall receive a bonus of
$25,000 for 1994 (payable in 1995 after U.S. Can's
financial statements for fiscal year 1994 have been
approved).
B. BENEFITS. The Employee shall be entitled to
receive a car or an allowance not in excess of $9,600
per year and the other fringe benefits received by
other officers of U.S. Can and its Affiliates,
including but not limited to, being covered under any
incentive compensation plans, group insurance plans,
stock option and/or stock purchase plans and any
retirement accumulation plan, including but not
limited to the Nonqualified Excess Benefit
Replacement Plan pursuant to Section 401(a)(17) and
Section (15) of the Internal Revenue Code of 1986, as
amended, offered by U.S. Can and/or its Affiliates;
provided, however, that nothing herein shall
require U.S. Can or its Affiliates to maintain the
fringe benefits currently provided to officers of
U.S. Can and/or its Affiliates.
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C. REASONABLE AND NECESSARY BUSINESS EXPENSES. The
Employee shall be entitled to reimbursement from U.S.
Can of reasonable and necessary business expenses
incurred by the Employee in the course of his
employment.
D. VACATION/HOLIDAYS. During each year of the Term
of Employment, the Employee shall be entitled to
four (4) weeks of paid vacation plus the paid
holidays observed by U.S. Can and its Affiliates.
E. 1995 REVIEW. The Employee's yearly base salary
will be reviewed by U.S. Can Corporation's
Compensation Committee of the Board of Directors and
the Chief Executive Officer at the first board
meeting in 1995 for any salary action in 1995.
5. TERM OF EMPLOYMENT. The Employee's term of
employment by U.S. Canshall commence on the date hereof and shall continue
until termination thereof by the Employee or U.S. Can pursuant to the terms
hereof (the "Term Of Employment"), subject to the provisions of Section 10
hereof.
6. TERMINATION. The Term of Employment may be
terminated (i) by U.S. Can with cause (as set forth below), effective
immediately; (ii) by U.S. Can without cause (as set forth below), effective 30
days after written notice to Employee; (iii) by Employee unilaterally,
effective 30 days after written notice to U.S. Can; or (iv) on death of the
Employee, effective immediately.
Termination with cause is permitted in the following
circumstances:
(a) material breach or non-performance of any of
the terms and conditions of this Agreement by
Employee without proper cause, after a
written demand for performance has been
delivered to
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Employee by U.S. Can, which notice specifies
the nature of the default and Employee has
failed to cure such default within five (5)
days thereafter;
(b) commission of any crime involving assault,
moral turpitude or any felony in connection
with the performance of his duties hereunder;
or
(c) other intentional or negligent conduct having
a material adverse effect on the condition,
financial or otherwise, of U.S. Can, or any
of its Affiliates.
In every other case of termination by U.S. Can, the termination shall be deemed
to be without cause.
7. SEVERANCE PAYMENTS. Should U.S. Can or its
successor/assignee terminate the Term of Employment without cause pursuant to
Section 6(ii) above, the Employee shall receive eighteen (18) months of base
salary and the insurance benefits which exist during the pay period immediately
preceding the termination of the Term of Employment (the "Severance Payments").
The Severance Payments shall be payable in the same manner as base salary
payments are made during the Term of Employment in accordance with Section 4
hereof.
8. DISABILITY OF THE EMPLOYEE. In the event that the
Employee suffers total and permanent disability during the Term of Employment
hereunder, then, effective on the date thereof, the Term of Employment shall
conclude; provided, however, that the termination of the Term of Employment
resulting from the total and permanent disability shall be deemed to be
termination without cause, and the Employee shall be entitled to receive the
Severance Payments pursuant to Section 7 hereof, less any other amount received
by the Employee as a result of such disability as provided for in Section 4(a)
hereof. Total and permanent disability shall mean a disability because of
which the Employee is physically or mentally unable to substantially
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perform the duties required of him under this Agreement for a period of six (6)
consecutive months or more.
9. DEATH OF THE EMPLOYEE. If the Employee dies during
his Term of Employment hereunder, the Term of Employment shall conclude on the
date thereof, and the Employee's designated beneficiary, or in the event no
beneficiary has been designated or survives the Employee, the estate of the
Employee shall be entitled to receive a death benefit from U.S. Can equal to
one and one-half times the Employee's base salary existing on the date of his
death. Any amounts payable by U.S. Can in respect of the death benefit provided
herein may be paid in eighteen (18) equal installments at U.S. Can's option.
10. EFFECT OF EXPIRATION OR TERMINATION. If the Term of
Employment comes to an end for any reason whatsoever, the obligations of the
parties under Sections 11 and 12 shall continue in accordance with the terms
and conditions of each respective Section. Further, Sections 4 and 7 will
remain in full force and effect until the Employee's account is settled.
11. NON-COMPETITION. The Employee hereby agrees that,
during the Term of Employment, and during the Agreed Period (as hereinafter
defined), the Employee shall not (a) engage, directly or indirectly, in any
Prohibited Activities (as hereinafter defined) in any Prohibited Territory (as
hereinafter defined) as an owner, officer, director, employee, stockholder,
principal, consultant, agent lender, guarantor, cosigner, investor or trustee
of any corporation, partnership, proprietorship, joint venture, association or
any other entity or business of any nature or (b) solicit any customers or
clients of U.S. Can or its Affiliates in connection with any transactions which
are in direct competition with the business of U.S. Can. Notwithstanding the
foregoing, the Employee may be the owner of not more than 5% of the outstanding
capital stock of any corporation engaged in Prohibited Activities (as defined
herein). For purposes of this
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Section 11, (i) "Prohibited Activities" shall mean any manufacturing,
development, sales, marketing, licensing and/or distribution of any container
which is directly competitive with any product supplied by U.S. Can or any of
its Affiliates and the provision of any services directly competitive with
services offered by U.S. Can or its Affiliates and (ii) "Prohibited Territory"
means the United States and any other country or applicable geographic area
where the products and/or services of U.S. Can or its Affiliates are sold. The
term "Agreed Period" shall mean the Term of Employment and the one and one-half
year period following the date on which the Term of Employment is terminated.
12. CONFIDENTIALITY.
(a) For purposes of this Section 12, "U.S. Can
Confidential Information" means all Trade Secrets and Other Confidential
Technical and Business Information (as defined below) (whether or not reduced
to writing and whether or not patentable or protectable by copyright) which
U.S. Can now owns or is licensed to use, or may in the future own or be
licensed to use during the entire term of your employment at U.S. Can,
including the Term of Employment hereunder. "Trade Secrets and Other
Confidential Technical and Business Information" means all confidential or
proprietary product development and design information and all confidential or
proprietary procedures, techniques, manuals, customer information,
specifications, data bases, test results, information concerning business or
product acquisitions, strategic plans, customer lists, pricing data, and
discoveries, inventions and innovations made, created, acquired or developed by
or on behalf of U.S. Can and/or its Affiliates but excluding in each case any
information which as a whole (a) is contained at the time of disclosure or
thereafter in a patent or a printed publication available to the general
public, (b) is obtained from a third party lawfully in possession of such
information and who is not subject to a contractual or a fiduciary duty not
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to disclose such information, or (c) any other information which is known
generally by the public.
(b) The Employee agrees to take the following steps to
preserve the confidential and proprietary nature of U.S. Can Confidential
Information:
(i) During or after the Employee's employment by U.S.
Can, the Employee will not disclose or transfer any
of the U.S. Can Confidential Information other than
as authorized by U.S. Can within the scope of the
Employee's duties with U.S. Can. Except to the
extent the Employee is authorized to do so in his
capacity as an employee or officer of U.S. Can, the
Employee understands that he is not allowed to sell,
license or otherwise exploit any products or services
which embody or utilize in whole or in part any U.S.
Can Confidential Information.
(ii) The Employee will take all reasonable precautions to
prevent the unauthorized disclosure (whether
inadvertent or deliberate) of U.S. Can Confidential
Information to unauthorized persons or entities, and
will report promptly to appropriate U.S. Can
management any such activities by others.
(iii) While the Employee is permitted to retain all
personal information which is not comprised of or
derived from U.S. Can Confidential Information (in
whole or in part), all notes, files, data, tapes,
reference materials, reports, sketches, drawings,
price lists, customer lists, plans, memoranda,
records and any other document or matter comprised
of, or derived from, U.S. Can Confidential
Information (in whole or in part) shall belong
exclusively to U.S. Can. At the request of U.S. Can
or upon termination of the Employee's employment with
U.S. Can, the Employee will deliver to U.S. Can all
tangible materials embodying U.S. Can Confidential
Information in his possession or control.
(c) Except as otherwise provided herein, this Section 11
shall survive for a period of ten (10) years following termination of this
Agreement.
13. EQUITABLE RELIEF. The Employee understands that a
breach by him of any provision of this Agreement may cause substantial injury
to U.S. Can and/or its Affiliates which may be irreparable and/or in amounts
difficult or impossible to ascertain, and that in the event the Employee
breaches any provision of this Agreement, U.S. Can shall have, in addition
to all
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other remedies available in the event of a breach of this Agreement, the right
to injunctive or other equitable relief. Further, the Employee acknowledges
and agrees that the restrictions and commitments set forth in this Agreement
are necessary to protect U.S. Can's legitimate interests and are reasonable in
scope, area and time, and that if, despite this acknowledgment and agreement,
at the time of the enforcement of any provision of this Agreement a court of
competent jurisdiction shall hold that the period or scope of such provision is
unreasonable under the circumstances then existing, the maximum reasonable
period or scope under such circumstances shall be substituted for the period or
scope stated in such provision.
14. NON-WAIVER OF RIGHTS. The failure to enforce at any
time any of the provisions of this Agreement or to require at any time
performance by the other party of any of the provisions hereof shall in no way
be construed to be a waiver of such provisions or to affect either the validity
of this Agreement, or any part hereof, or the right of either party thereafter
to enforce each and every provision in accordance with the terms of this
Agreement.
15. ARBITRATION. Any dispute as to any claim under this
Agreement shall be settled by arbitration in Chicago, Illinois by an
arbitrator, who shall be appointed pursuant to the rules of the American
Arbitration Association. The arbitration shall be conducted promptly and
expeditiously in accordance with the applicable arbitration rules of the
American Arbitration Association. Any award issued as a result of such
arbitration shall be final and binding on the parties, and judgment upon the
award rendered by the arbitrators may be entered in any court having
jurisdiction thereof.
16. SEVERABILITY. Whenever there may be a conflict
between the provisions of this Agreement and any statute, prevailing law,
judicial decision, ordinance or regulation, the latter shall prevail, but in
such event the provisions of this Agreement so affected shall be
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construed and limited only to the extent necessary to bring it within the
requirements of such law and in no event shall such illegality or
unenforceability affect the remaining provisions or remaining portions of a
provision of this Agreement.
17. NOTICES. Any notice given by either party hereunder
shall be in writing and shall be personally delivered or shall be mailed,
certified or registered mail, postage prepaid, as follows:
To U.S. Can: United States Can Company
900 Commerce Drive
Oak Brook, Illinois 60521
Attention: Chief Executive Officer
with a copy to: Lawrence R. Samuels
Ross & Hardies
150 North Michigan
Chicago, Illinois 60601
To Employee: At the address of the Employee as
set forth on the payroll records of
U.S. Can
or to such other address as may have been furnished to the other party by
written notice in accordance with this Section 17.
18. ASSIGNMENT. The rights and obligations of U.S. Can
under this Agreement shall inure to the benefit of and shall be binding upon
the successors and assigns of U.S. Can.
19. ENTIRE AGREEMENT. This Agreement (together with any
applicable stock option agreement or stock purchase agreement) contains the
entire agreement between the parties and supersedes all prior or contemporaneous
agreements and representations, written or oral with respect to the subject
matter described herein. No representations or agreements, written or oral,
other than the representations and agreements contained in this Agreement, or
any applicable stock option agreement or stock purchase agreement, have been
made to or in favor of the
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Employee with respect to the subject matter described herein. This Agreement
may not be changed orally, but only by an agreement in writing signed by both
parties.
20. APPLICABLE LAW. This Agreement shall be interpreted
and enforced in accordance with the laws of the State of Illinois, without
regard to its conflicts of law doctrine, and the Employee hereby consents to
personal jurisdiction in Illinois for such purpose.
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IN WITNESS WHEREOF, the parties have executed this Agreement,
in triplicate, on the date first written above.
UNITED STATES CAN COMPANY
/s/ Tony Bonadonna By /s/ William J. Smith
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Tony Bonadonna William J. Smith
President and Chief
Executive Officer
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