Employment Agreement - American Seafoods LP, American Seafoods Co. LLC and Inge Andreassen
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (this "Agreement") made and entered into as of the
28th day of January 2000, among AMERICAN SEAFOODS, L.P. ("Parent") and AMERICAN
SEAFOODS COMPANY LLC ("Employer" or the "Company") and INGE ANDREASSEN who
resides at 22018 94/th/ Pl. W., Edmonds, Washington 98020("Executive").
W I T N E S S E T H:
WHEREAS, Employer desires to employ Executive and Executive desires to
accept employment with Employer upon the terms and conditions hereinafter set
forth;
NOW THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth, and intending to be legally bound hereby, it is hereby
agreed as follows:
1. Employment Term. Employer agrees to employ Executive, and Executive
agrees to be so employed, in the capacity of Vice President of Operations, for a
term commencing on the date hereof and ending on the fifth anniversary of the
date hereof (the "Initial Term"); provided, however, that, notwithstanding
anything to the contrary set forth in this Agreement, this Agreement may be
earlier terminated pursuant to the terms hereof. The term of this Agreement will
automatically extend past the Initial Term for succeeding periods of one year
each unless either party terminates this Agreement as of the end of the Initial
Term, or as of the end of any subsequent one-year period (in either case, the
"Termination Date"), by delivering notice to the other party specifying the
applicable Termination Date not earlier than 180 days and not later than 120
days prior to the date so specified. "Employment Term" as used herein shall mean
the term of this Agreement including any automatic extensions pursuant to the
preceding sentence.
2. Position and Duties. Executive shall (in accordance with Section 11
hereof) diligently and conscientiously devote his full business time, attention,
energy, skill and best efforts to the business of Employer and the discharge of
his duties hereunder. Executive's duties under this Agreement shall be to serve
as Vice President of Operations of Employer, with the responsibilities, rights,
authority and duties customarily pertaining to such office and as may be
established from time to time by or under the direction of the Board of
Directors or similar governing body of Employer (the "Board") or its designees,
and Executive shall report to the President of American Seafoods Company LLC.
Executive shall also act as an officer and/or director and/or manager of such
subsidiaries of Employer as may be designated by the Board, commensurate with
Executive's office, all without further compensation, other than as provided in
this Agreement.
3. Compensation.
(a) Base Salary. Employer shall pay to Executive base salary
compensation at an annual rate of $175,000. In January 2001 and annually
thereafter, the Board shall review Executive's base salary in light of the
performance of Executive and the Company, and may, in its sole discretion,
increase or decrease (but not decrease below $175,000) such base
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salary by an amount it determines to be appropriate. Executive's annual base
salary payable hereunder, as it may be increased or decreased from time to time,
is referred to herein as "Base Salary." Base Salary shall be paid in equal
installments in accordance with Employer's payroll practices in effect from time
to time for executive officers, but in no event less frequently than monthly.
(b) Bonus. In addition to Base Salary, Executive may receive an
annual bonus of an amount to be determined by the Board in its sole discretion,
taking into consideration individual and corporate performance. Further,
Executive shall be entitled to receive with respect to each fiscal year during
the Employment Term a nondiscretionary bonus if the EBITDA (as defined on
Schedule I hereto) of Parent and its subsidiaries in such fiscal year exceeds
certain targets. The amount and calculation of such bonus are described with
particularity on Schedule I hereto. In no event will (i) the nondiscretionary
bonus be payable if at the time of payment or at any time during the year of
measurement the Company was in default under any credit agreement relating to
indebtedness for borrowed money or (ii) the annual bonus (including
discretionary and nondiscretionary portions thereof) in any year exceed 150% of
Executive's Base Salary. The annual bonus with respect to any year, if any,
shall be paid within 30 days after the receipt by the Board of audited financial
statements for Parent and its subsidiaries for the pertinent year.
(c) Equity Investment by Executive. Concurrently with the
signing of this Agreement, Executive is purchasing, pursuant to a subscription
agreement, dated as of the date hereof, between Executive and Parent, 3,000
Regular Units in Parent for an aggregate purchase price of $300,000. Executive's
purchase of such partnership units is being funded by a loan in the amount of
$300,000 from Parent to Executive pursuant to the terms and conditions of the
loan documentation attached as Exhibit A hereto.
(d) Option Grants.
(i) Concurrently with the signing of this Agreement, Company
shall grant Executive non-qualified options to purchase 5,550 Regular
Units in Parent, at a per unit price equal to $100.
(ii) The grant of 5,550 options pursuant to this Paragraph 3(d)
shall be Comprised of 1,850 Series A Options, 1,850 Series B Options and
1,850 Series C Options. All such options shall be subject to the terms
and conditions set forth in the Option Agreements applicable to such
Series, forms of which are attached hereto as Exhibits B-l, B-2 and B-3
and the American Seafoods L.P. Year 2000 Unit Option Plan referred to
therein.
4. Benefits. Executive shall be eligible to participate in all
employee benefit programs of Employer offered from time to time during the term
of Executive's employment hereunder by Employer to employees or executives of
Executive's rank, to the extent that Executive qualifies under the eligibility
provisions of the applicable plan or plans, in each case consistent with
Employer's then-current practice as approved by the Board from time to time. The
foregoing shall not be construed to require Employer to establish such plans or
to prevent the modification or termination of such plans once established, and
no such action or failure
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thereof shall affect this Agreement. Executive recognizes that Employer and its
affiliates have the right, in their sole discretion, to amend, modify or
terminate their benefit plans without creating any rights in Executive.
5. Vacation. Executive shall be entitled to up to four weeks
of paid vacation per calendar year. A maximum of one week of vacation time may
be carried over from one calendar year and into the following calendar year;
provided however, that the vacation time be exercised prior to the end of the
subsequent calendar year.
6. Business Expenses. To the extent that Executive's
reasonable and necessary expenditures for travel, entertainment and similar
items made in furtherance of Executive's duties under this Agreement comply
with Employer's expense reimbursement policy, are wholly or partially
deductible by Employer for federal income tax purposes pursuant to the Internal
Revenue Code of 1986, as amended and are documented and substantiated by
Executive as required by the Internal Revenue Service and the policies of
Employer, Employer shall reimburse the Executive for such expenditures;
provided documentation therefor is submitted not later than 45 days after such
expense is incurred.
7. Termination by the Company.
(a) Employer shall have the right to terminate the
Employment Term under the following circumstances (and also as contemplated by
Section 8(b)):
(i) upon the death of Executive;
(ii) in the event of a disability which prevents or
seriously inhibits Executive from performing his duties for 60
consecutive days as determined in good faith by the Board, upon 30
days written notice from Employer to Executive; or
(iii) for Cause (as defined below).
"Cause" as used in this Agreement shall mean (i) Executive's commission of a
felony or any other crime involving moral turpitude, fraud, misrepresentation,
embezzlement or theft, (ii) Executive's engaging in any activity that is harmful
(including, without limitation, alcoholic or other self-induced affliction), in
a material respect, to the Company or any of its subsidiaries, monetarily or
otherwise, as determined by a majority of the Board; (iii) Executive's material
malfeasance (including without limitation, any intentional act of fraud or
theft), misconduct, or gross negligence in connection with the performance of
his duties hereunder; (iv) Executive's significant violation of any statutory or
common law duty of loyalty to the Company or any of its subsidiaries; (v)
Executive's material breach of this Agreement or of a material Company policy
(including without limitation, disclosure or misuse of any confidential or
competitively sensitive information or trade secrets of the Company or a
subsidiary); or (vi) Executive's refusal or failure to carry out directives or
instructions of the Board that are consistent with the scope and nature of
Executive's duties and responsibilities set forth herein, in the case of clause
(v) or (vi) above, only if such breach or failure continues for more than 10
days following written notice from Employer describing such breach or failure.
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(b) If this Agreement is terminated pursuant to Paragraph 7(a), or
for any other reason (except by Executive pursuant to Paragraph 8 or by Employer
other than pursuant to Paragraph 7(a)), Executive's rights and Employer's
obligations hereunder shall forthwith terminate except that Employer shall pay
Executive his Base Salary earned but not yet paid through the date of
termination. In addition, if the Executive is terminated pursuant to Paragraph
7(a)(i) or 7(a)(ii), Employer shall also pay Executive within 30 days following
receipt of audited financial statements for the year during which such
termination occurred, a prorated annual bonus in respect of the partial year
during which such termination occurred, the amount to be equal to the full
amount of the nondiscretionary bonus, if any, that would be due under Section
3(b) multiplied by a fraction, the numerator of which is the number of days in
such fiscal year prior to such termination and the denominator of which is 365.
8. Termination by Executive.
(a) Executive shall have the right to terminate the Employment Term
for Good Reason (as defined below), upon 60 days' written notice to the Board
given within 60 days following the occurrence of an event constituting Good
Reason; provided that Employer shall have 10 days after the date such notice has
been given to the Board in which to cure the conduct specified in such notice.
For purposes of this Agreement "Good Reason" shall mean:
(i) the Company's failure to pay or provide when due Executive's
Base Salary, which failure is not cured within 10 days after the receipt by
the Board from Executive of a written notice referring to this provision
and describing such failure; or
(ii) the failure to continue Executive in his position as provided in
Paragraph 1 or removal of him from such position; or
(iii) a material diminution of Executive's responsibilities, duties or
status, which diminution is not rescinded within 30 days after the date of
receipt by the Board from Executive of a written notice referring to this
provision and describing such diminution.
(b) If this Agreement is terminated pursuant to Paragraph 8(a), or
if Employer shall terminate Executive's employment under this Agreement other
than pursuant to Paragraph 7(a), Executive shall be entitled to the following,
which he acknowledges to be fair and reasonable, as his sole and exclusive
remedy, in lieu of all other remedies at law or in equity, for any such
termination:
(i) Base Salary earned but not yet paid through the date of
termination;
(ii) a prorated annual bonus in respect of the partial year during
which such termination occurred, the amount to be equal to the full amount
of the nondiscretionary bonus, if any, that would be due under Section 3(b)
multiplied by a fraction, the numerator of which is the number of days in
such fiscal year prior to such termination and the denominator of which is
365; and
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(iii) an amount equal to Executive's actual Base Salary (not including
any bonus paid or payable) for the l2-month period immediately prior to
such termination (or the period during which Executive was employed by
Employer if less than 12 months), payable in 24 equal installments during
the 24-month period following such termination (the "Severance Pay
Period").
In the event of any such termination, Executive shall use commercially
reasonable efforts to secure alternative employment. During the last six months
of the Severance Pay Period, any compensation, income or benefits earned by or
paid to (in cash or otherwise) the Executive as an employee of or consultant to
a company other than the Company shall reduce the amount of severance payments
payable during such six-month period pursuant to Paragraph 8(b)(iii).
(c) If Executive terminates his employment at any time during the
term of this Agreement other than pursuant to Section 8(a), without limiting or
prejudicing any other legal or equitable rights or remedies which Employer may
have upon such breach by Executive, Executive will receive his Base Salary
earned but not yet paid though the date of termination.
9. Services Unique. Executive recognizes that Executive's services
hereunder are of a special, unique, unusual, extraordinary and intellectual
character giving them a peculiar value, the loss of which cannot be reasonably
or adequately compensated for in damages, and in the event of a breach of this
Agreement by Executive (particularly, but without limitation, with respect to
the provisions hereof relating to the exclusivity of Executive's services and
the provisions of Paragraph 11), the Company shall, in addition to all other
remedies available to it, be entitled to equitable relief by way of an
injunction and any other legal or equitable remedies. Anything to the contrary
herein not withstanding, the Company may seek such equitable relief in a federal
or state court in New York, and the Executive hereby submits to jurisdiction in
those courts.
10. Protection of the Company's Interests. To the fullest extent permitted
by law, all rights worldwide with respect to any intellectual or other property
of any nature conceived, developed, produced, created, suggested or acquired by
Executive during the period commencing on the date hereof and ending six months
following the termination of Executive's employment hereunder shall be deemed to
be a work made for hire and shall be the sole and exclusive property of
Employer. Executive agrees to execute, acknowledge and deliver to Employer at
Employer's request, such further documents as the Employer finds appropriate to
evidence the Employer's rights in such property. Executive further acknowledges
that in performing his duties hereunder, he will have access to proprietary and
confidential information and to trade secrets of Employer and its affiliates.
Any confidential and/or proprietary information of Employer or its affiliates
shall not be used by Executive or disclosed or made available by Executive to
any person except (i) as required in the course of Executive's employment or
(ii) when required to do so by a court of law, by any governmental agency having
supervisory authority over the business of Employer or by any administrative or
legislative body (including a committee thereof) with apparent jurisdiction to
order him to divulge, disclose or make accessible such information, it being
understood that Executive will promptly notify Employer of such requirement so
that Employer may seek to obtain a protective order. Upon expiration or earlier
termination of the term of Executive's employment, Executive shall return
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to Employer all such information that exists in written or other physical form
(and all copies thereof) under Executive's control.
11. Non-Competition.
(a) Exclusivity of Employment. Executive agrees that his employment
hereunder is on an exclusive basis, and that during the Employment Term, he
will not engage in any other business activity. Notwithstanding the
foregoing, nothing in this Agreement shall preclude Executive from serving on
the Boards of Directors of other corporations (subject to the approval of the
Board which shall not be unreasonably withheld), from engaging in charitable and
public service activities, or engaging in speaking and writing activities, or
from managing his personal investments, provided that such activities are
disclosed in writing to the Board in a notice that references this provision and
do not interfere with Executive's availability or ability to perform his duties
and responsibilities hereunder.
(b) Noncompete. Executive agrees that during the Employment Term,
and the Severance Pay Period (if applicable), and the 12-month period
thereafter, he shall not, directly or indirectly, engage in, or participate as
an investor in, an officer, employee, director or agent of, or consultant for,
any entity engaging in any line of business competitive with that of Employer or
any of its subsidiaries, or any line of business which Employer or any of its
subsidiaries is contemplating; provided however that, nothing herein shall
prevent him from investing as less than a 5% shareholder in the securities of
any company listed on a national securities exchange or quoted on an automated
quotation system. Executive's participation in an entity in any of the foregoing
capacities, other than participation described in the foregoing proviso, being
sometimes referred to herein as being a "Participant."
(c) Nonsolicitation of Employees. Executive agrees that during the
Employment Term and the Severance Pay Period (if applicable), and the 36-month
period thereafter (the "Nonsolicitation Period"), he will not directly or
indirectly, employ, or be a Participant in any entity that employs, any person
previously employed by the Company or any of its subsidiaries or in any way
induce or attempt to induce any person to leave the employment of the Company or
any of its subsidiaries.
(d) Nonsolicitation of Customers. Executive agrees that during the
Nonsolicitation Period, he will not directly or indirectly, solicit or do
business with, or be a Participant in any entity that solicits or does business
with, any customer of Employer or any of its subsidiaries, nor shall Executive
in any way induce or attempt to induce any customer of Employer to do business
with any person or entity other than Employer; provided that, the foregoing
shall not restrict Executive or any entity in which he is a Participant from
soliciting or doing business with any customer of Employer or any of its
subsidiaries with respect to a business that is not competitive with the
business of Employer or any of its subsidiaries or any line of business that
Employer or any of its subsidiaries is contemplating. Notwithstanding the
foregoing, after the expiration of the noncompetition period set forth in
Paragraph 11(b), Executive may participate as an investor in, an officer,
employee, director or agent of or consultant for an entity that does business
with one or more customers of Employer so long as Executive has no contact with
such customer and has no direct or indirect involvement in the solicitation of
business from any such customer.
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(e) Standstill. Executive agrees that during the
Nonsolicitation Period. Executive shall not, except at the specific written
request of the Board:
(i) engage in or propose, or be a Participant in any entity
that engages in or proposes, a Rule 13e-3 Transaction (as defined in Rule
13e-3 under the Securities Exchange Act of 1934) or any other material
transaction, between Parent, Employer or any of its subsidiaries, on the
one hand, and Executive or any entity in which Executive is a Participant,
on the other hand;
(ii) acquire any equity securities of Parent, Employer or any of
its subsidiaries (other than partnership units issued to Executive by
Parent or issued to Executive by Parent upon exercise of options issued to
Executive by Parent), or be a participant in any entity that acquires any
equity securities of Parent, Employer or any of its subsidiaries;
(iii) solicit proxies, or be a Participant in any entity that
solicits proxies, or become a participant in any solicitation of proxies,
with respect to the election of directors of Parent, Employer or any of its
subsidiaries in opposition to the nominees recommended by the Board of any
such entity; or
(iv) directly or indirectly, engage in or participate in any
other activity that would be reasonably expected to result in a change of
control of Parent, Employer or any of its subsidiaries.
The foregoing provisions of this Paragraph shall not be construed to prohibit or
restrict the manner in which Executives exercises his voting rights in respect
of partnership units in Parent acquired in a manner that is not a violation of
the terms of this Paragraph 11.
12. Nondisparagement. Executive will not at any time during or after
this Agreement directly (or through any other person or entity) make any public
or private statements (whether oral or in writing) which are derogatory or
damaging to the Company, its business, activities, operations, affairs,
reputation or prospects or any of its officers, employees, directors or
shareholders. Employer will not at any time during or after the term of this
Agreement directly (or through any other person or entity) make any defamatory
public or private statements (whether oral or in writing) concerning the
Executive.
13. Representation of the Parties. Executive represents and warrants
to Employer and Parent that Executive has the capacity to enter into this
Agreement and the other agreements referred to herein, and that the execution,
delivery and performance of this Agreement and such other agreements by
Executive will not violate any agreement, undertaking or covenant to which
Executive is party or is otherwise bound. Each of Employer and Parent represents
to Executive that it is a limited liability company or limited partnership, as
applicable, and is duly organized and validly existing under the laws of the
State of Delaware, that it is fully authorized and empowered by action of its
Board or general partner, as applicable, to enter into this Agreement and the
other agreements referred to herein, and that performance of its obligations
under this Agreement and such other agreements will not violate any agreement
between it and any other person, firm or other entity.
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14. Key Man Insurance. Each of Employer and Centre Partners
Management LLC or its affiliates (collectively, "Centre Partners") will have the
right throughout the term of this Agreement, to obtain or increase insurance on
Executive's life in such amount as the Board or Centre Partners (as applicable)
determines, in the name of Employer or Centre Partners, as the case may be, and
for its sole benefit or otherwise, in the discretion of the Board or Centre
Partners (as applicable). Executive will cooperate in any and all necessary
physical examinations without expense to Executive, supply information, and sign
documents, and otherwise cooperate fully with each of Employer and Centre
Partners as Employer or Centre Partners (as applicable) may request in
connection with any such insurance. Executive warrants and represents that, to
his best knowledge, he is in good health and does not suffer from any medical
condition which might interfere with the timely performance of his obligations
under this Agreement.
15. Notices. All notices given under this Agreement shall be in
writing and shall be deemed to have been duly given (a) when delivered
personally, (b) three business days after being mailed by first class certified
mail, return receipt requested, postage prepaid, (c) one business day after
being sent by a reputable overnight delivery service, postage or delivery
charges prepaid, or (d) on the date on which a facsimile is transmitted to the
parties at their respective addresses stated below. Any party may change its
address for notice and the address to which copies must be sent by giving notice
of the new addresses to the other parties in accordance with this Paragraph 15,
except that any such change of address notice shall not be effective unless and
until received.
If to the Employer or Parent:
c/o Centre Partners Management LLC
30 Rockefeller Plaza
Suite 5050
New York, New York 10020
Facsimile: 212-332-5801
Attention: Scott Perekslis
with a copy to:
O'Melveny & Myers LLP
153 East 53/rd/ Street
New York, New York 10022
Facsimile: 212-326-2061
Attention: Jeffrey J. Rosen, Esq.
If to the Executive, to his address set forth above.
16. Entire Agreement, Amendments, Waivers, Etc.
(a) No amendment or modification of this Agreement shall be
effective unless set forth in a writing signed by the Company and Executive. No
waiver by either party of any breach by the other party of any provision or
condition of this Agreement
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shall be deemed a waiver of any similar or dissimilar provision or condition at
the same or any prior or subsequent time. Any waiver must be in writing and
signed by the waiving party.
(b) This Agreement, together with the Exhibits and Schedules hereto
and the documents referred to herein and therein, sets forth the entire
understanding and agreement of the parties with respect to the subject matter
hereof and supersedes all prior oral and written understandings and agreements.
There are no representations, agreements, arrangements or understandings, oral
or written, among the parties relating to the subject matter hereof which are
not expressly set forth herein, and no party hereto has been induced to enter
into this Agreement, except by the agreements expressly contained herein.
(c) Nothing herein contained shall be construed so as to require the
commission of any act contrary to law, and wherever there is a conflict between
any provision of this Agreement and any present or future statute, law,
ordinance or regulation, the latter shall prevail, but in such event the
provision of this Agreement affected shall be curtailed and limited only to the
extent necessary to bring it within legal requirements.
(d) This Agreement shall inure to the benefit of and be enforceable
by Executive and his heirs, executors, administrators and legal representatives,
by the Company and its successors and assigns, by Parent and its successors and
assigns and, with respect to Paragraph 14, Centre Partners and its successors
and assigns. This Agreement and all rights hereunder are personal to Executive
and shall not be assignable. Each of the Company and Parent may assign its
rights under this Agreement to any successor by merger, consolidation, purchase
of all or substantially all of its and its subsidiaries' assets, or otherwise;
provided that such successor assumes all of the liabilities, obligations and
duties of the Company under this Agreement, either contractually or as a matter
of law.
(e) If any provision of this Agreement or the application thereof is
held invalid, the invalidity shall not affect the other provisions or
application of this Agreement that can be given effect without the invalid
provisions or application, and to this end the provisions of this Agreement are
declared to be severable.
17. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without reference to
principles of conflict of laws.
18. Right to Equitable Relief. Executive recognizes that Employer will
have no adequate remedy at law for his breach of any provision of Paragraph 10,
11 or 12 and in the event of any such breach or threatened breach he agrees that
Employer shall be entitled to obtain equitable relief in addition to other
remedies available at law and/or hereunder.
19. Taxes. All payments required to be made to Executive hereunder,
whether during the term of his employment hereunder or otherwise shall be
subject to all applicable federal, state and local tax withholding laws.
20. Headings Etc. The headings set forth herein are included solely for
the purpose of identification and shall not be used for the purpose of
construing the meaning of the
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provisions of this Agreement. Unless otherwise provided, references herein to
Exhibits, Schedules and Paragraphs refer to Exhibits and Schedules to and
Paragraphs of this Agreement.
21. Arbitration. Any dispute or controversy between Employer and
Executive, arising out of or relating to this Agreement, the breach of this
Agreement, or otherwise, shall be settled by arbitration in New York, New York,
administered by the American Arbitration Association in accordance with its
Commercial Rules then in effect and judgment on the award rendered by the
arbitrator may be entered in any court having jurisdiction thereof. The
arbitrator shall have the authority to award any remedy or relief that a court
of competent jurisdiction could order or grant, including, without limitation,
the issuance of an injunction. However, either party may, without inconsistency
with this arbitration provision, apply to any court having jurisdiction over
such dispute or controversy and seek interim provisional, injunctive or other
equitable relief until the arbitration award is rendered or the controversy is
otherwise resolved. Except as necessary in court proceedings to enforce this
arbitration provision or an award rendered hereunder, or to obtain interim
relief, neither a party nor an arbitrator may disclose the existence, content or
results of any arbitration hereunder without the prior written consent of
Employer and Executive.
22. Survival. Executive's obligations under the provisions of Paragraphs
10, 11 and 12, as well as the provisions of Paragraphs 6, 7(b), 8(b) and 15
through and including 19 and Paragraphs 21 and 22, shall survive the termination
or expiration of this Agreement.
23. Construction. Each party has cooperated in the drafting and
preparation of this Agreement. Therefore, in any construction to be made of this
Agreement, the same shall not be construed against any party on the basis that
the party was the drafter.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
EMPLOYER:
AMERICAN SEAFOODS GROUP LLC
By /s/ Bernt O. Bodal
----------------------------------------
Name: Bernt O. Bodal
Title: Managing Director
EXECUTIVE:
/s/ Inge Andreassen
------------------------------------------
Inge Andreassen
AMERICAN SEAFOODS:
AMERICAN SEAFOODS, L.P.
By: ASC Management, Inc., its General Partner
By /s/ Bernt O. Bodal
----------------------------------------
Bernt O. Bodal
President
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SCHEDULE I
BONUS CALCULATION
Subject to the terms and conditions of Section 3(b) (including the
requirement that there shall have occurred no default under credit agreements
applicable to Employer or its affiliates), the nondiscretionary bonus described
in Section 3(b) for any fiscal year shall be equal to (i) if EBITDA for such
fiscal year is less than 80% of Target EBITDA for such fiscal year, zero
dollars; (ii) if EBITDA for such fiscal year exceeds 120% of Target EBITDA for
such fiscal year, 150% of Executive's Base Salary for such fiscal year; and
(iii) if neither (i) nor (ii) applies, the product of 150% of Executive's Base
Salary during such fiscal year multiplied by a fraction, the numerator of which
is the amount by which EBITDA for such fiscal year exceeds 80% of Target EBITDA
for such fiscal year, and the denominator of which is 40% of Target EBITDA for
such fiscal year. Such bonus shall be determined by the Board in good faith on
the basis of the audited financial statement of Parent and its subsidiaries.
For these purposes:
"EBITDA" means, for any period, the sum of the amounts for such period
of (i) net income (or loss) (excluding (I) interest income, (II) noncash income
items (other than ordinary accruals) and (III) extraordinary items), plus (ii)
to the extent deducted in determining consolidated net income, (x) interest
expense, (y) provisions for taxes based on net income and (z) depreciation and
amortization expense, each as determined for the Partnership and its
subsidiaries on a consolidated basis in accordance with generally accepted
accounting principals, consistently applied, except that no effect shall be
given to noncash gains and losses on foreign exchange contracts. EBITDA for any
period shall be determined by the Board acting in good faith following receipt
of audited financial statements for the relevant period and shall reflect as
expenses (determined on an iteractive basis if necessary) any bonuses payable in
respect of such year.
"Target EBITDA" means, for any fiscal year, the amount set forth in the
table below opposite such fiscal year.
ANNUAL EBITDA TARGET
FISCAL YEAR EBITDA
(in millions)
2000 s 88.6
2001 $ 106.8
2002 $ 109.9
2003 $ 111.4
2004 $ 116.4
I-1