Employment Agreement - American Seafoods LP, American Seafoods Group LLC and Michael J. Hyde
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (this "Agreement") made and entered into as of the 1st
day of April 2000, among AMERICAN SEAFOODS, L.P. ("Parent") and American
Seafoods Group LLC ("Employer" or the "Company") and Michael J. Hyde who resides
at 1712 Bigelow Avenue North, Seattle, WA 98109 ("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 President and Chief Executive
Officer of American Seafoods Company LLC and Managing Director and General
Counsel of the Company, 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 Employment and the discharge
of his duties hereunder. Executive's duties under this Agreement shall be to
serve as President and Chief Executive Officer of American Seafoods Company LLC
and Managing Director and General Counsel of the Company, 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 Chairman of the Board of
American Seafoods Group 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.
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3. Compensation.
(a) Base Salary. Employer shall pay to Executive base salary
compensation at an annual rate of $325.000. 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 $325,000) such base 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 the Company is in material default
under any credit agreement relating to indebtedness for borrowed money or if at
any time during the year of measurement the Company incurred any default under
any credit agreement relating to indebtedness for borrowed money that resulted
in any charge or cost to the Company or any of its affiliates (whether or not
accrued or paid during the year of measurement and whether accounted for above
or below the EBITDA line) 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, 5,000 Regular Units
in Parent for a purchase price of $500,000. Executive's purchase of such
partnership units is being funded in part by a loan in the amount of $100,000
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 10,000 Regular Units in
Parent, at a per unit price equal to $100.
(ii) The grant of 10,000 options pursuant to this Paragraph 3(d) shall
be comprised of 3,334 Series A Options, 3,333 Series B Options and 3,333
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
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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 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 five weeks of paid
vacation per calendar year. A maximum of three weeks 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. Executive shall secure approval of the Chairman before
scheduling any vacation in excess of two consecutive weeks.
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,
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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.
(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
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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
(iii) an amount equal to Executive's actual Base Salary (not
including any bonus paid or payable) for the 12-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
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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 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, the Severance Pay Period (if applicable), and the 12-month period
thereafter (except if Executive's employment is terminated for Cause or
Executive terminates his employment without Good Reason, in which case such
12-month period shall be extended to a 24-month period), 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 whose primary
business involves the catching, processing or selling of pollock; 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." Nothing in this Agreement shall prevent Executive from
providing independent legal services after the termination of Executive's
employment hereunder, except that Executive shall not devote more than 10% of a
full time position to any single entity whose primary business involves the
catching, processing or selling of pollock.
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(c) Non-Interference. Executive agrees that during the
Employment Term, the Severance Pay Period (if applicable), and the 12-month
period thereafter (except if Executive's employment is terminated for Cause or
Executive terminates his employment without Good Reason, in which case such
12-month period shall be extended to a 36-month period) (the "Nonsolicitation
Period"), Executive shall not directly or indirectly: (i) induce, attempt to
induce or assist in inducing any executive, senior management employee or key
vessel crew member of the Company to leave the Company's employ, or in any way
interfere with the relationship between the Company and any of the Company's
executives, senior management or key vessel crew members; (ii) induce, attempt
to induce or assist in inducing any client, customer, supplier, licensee, or any
other business relation of the Company to cease or reduce its business dealings
with the Company, or in any way interfere with the relationship between any such
business relation and the Company; (iii) induce, attempt to induce or assist in
inducing any customer of Employer to do business with any person or entity other
than Employer; or (iv) take any other action which causes, or is intended to
cause, harm to the business or reputation of the Company.
(d) Investment Activities. The Company and Executive acknowledge
that Executive is an investor in the BEAGLE, UNIMAK, REBECCA IRENE and CAPE HORN
that operate in fisheries under the jurisdiction of the North Pacific Fishery
Management Council. The parties further acknowledge that under certain
circumstances a conflict could arise between the best interests of the Company
and the best interests of Executive's investments. The parties agree that
Executive may maintain but not increase his investments in the above-named
vessels without the prior written approval of the Board of Directors (which
approval shall not be unreasonably withheld), and that, in the event of a
conflict, Executive shall owe his undivided loyalty to furthering the best
interests of the Company.
(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 l3e-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
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(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.
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
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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:
American Seafoods Group LLC
2025 First Avenue
Suite 1200
Seattle, WA 98121
Facsimile: 206 374-l516
Attention: Bernt O. Bodal
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:
Michael J. Hyde
1712 Bigelow Avenue North
Seattle, WA 98109
If to the Board:
American Seafoods L.P.
c/o Centre Partners Management LLC
30 Rockefeller Plaza
Suite 5050
New York, New York 10020
Facsimile: 212-332-5801
Attention: Scott Perekslis
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 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.
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(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 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.
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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 Seattle, Washington,
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.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
AMERICAN SEAFOODS GROUP LLC:
By: /s/ Bernt O. Bodal
-------------------------------------
Name: Bernt O. Bodal
Title: Chairman and Sr. Managing Director
EXECUTIVE:
/s/ Michael J. Hyde
--------------------------------
Michael J. Hyde
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AMERICAN SEAFOODS:
AMERICAN SEAFOODS, L.P.
By: ASC Management, Inc.
By: /s/ Bernt O. Bodal
---------------------------
Name: Bernt O. Bodal
Title:
Hyde Employment Agrrement EXECUTION
AEmployHyde3 12
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SCHEDULE I
BONUS CALCULATION
Subject to the terms and conditions of Section 3(b) (including the
requirement that there shall exist no material default under credit agreements
applicable to Employer or its affiliates and that the Company (or any of its
affiliates) shall not have incurred any costs as a result of a default under any
such credit agreement at any time during the year of measurement), 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 iterative 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 $ 88.6
-------------------------------------------------------
2001 $106.8
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2002 $109.9
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2003 $111.4
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2004 $116.4
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I-1