Exhibit 10.16
EXECUTION COPY
AMENDED AND RESTATED EMPLOYMENT
AGREEMENT
Marc Reisch
This AMENDED AND RESTATED EMPLOYMENT
AGREEMENT (the “ Agreement ”) is dated as of
December 19, 2008 by and between Visant Holding Corp. (fka
Jostens Holding Corp.) (the “Company”) and Marc Reisch,
and amends and restates the Employment Agreement entered into as of
October 4, 2004 (the “ Effective Date ”) by
and between the Company and Marc Reisch (the “
Executive ”).
WHEREAS, as of the Effective Date,
the Company desires to employ Executive and to enter into an
agreement embodying the terms of such employment and Executive
desires to accept such employment and enter into such an
agreement.
NOW, THEREFORE, in consideration of
the premises and mutual covenants herein and for other good and
valuable consideration, the parties agree as follows:
1. Term of Employment .
Subject to the provisions of Section 8 of this Agreement,
Executive shall be employed by the Company, and any of its
subsidiaries that the Board of Directors of the Company (the
“ Board ”) shall designate (collectively, the
“ Employer ”) for a period commencing on the
Effective Date and ending on December 31, 2009 (the “
Initial Term ”), on the terms and subject to the
conditions set forth in this Agreement. Following the Initial Term,
the term of Executive’s employment hereunder shall
automatically be renewed on the terms and conditions hereunder for
additional one year periods commencing on each anniversary of the
last day of the Initial Term (the Initial Term and any annual
extensions of the term of this Agreement, subject to the provisions
of Section 8 hereof, together, the “ Employment
Term ”), unless either party gives written notice of
non-renewal at least sixty (60) days prior to such
anniversary. Any such written notice by the Company of non-renewal
shall be deemed to constitute a termination by the Employer Without
Cause under Section 8(c) of this Agreement.
2. Position .
a. During the Employment Term,
Executive shall serve as the Chief Executive Officer of the Company
and its subsidiaries. In such position, Executive shall have such
duties and authority as determined by the Board and commensurate
with the position of chief executive officer of a company of
similar size and nature to that of the Employer. During the
Employment Term, the Executive shall report solely to the Board and
shall serve as the Chairman of the Board; provided ,
however , that upon the completion of a Public Offering (as
such term is defined in that certain Management Stockholder’s
Agreement entered into by and between the Company and Executive as
of the Effective Date (the “ Management Stockholders
Agreement ”)), the Company may appoint another individual
as the non-executive Chairman of the Board.
b. During the Employment Term,
Executive will devote Executive’s full business time and
reasonable best efforts to the performance of Executive’s
duties hereunder and will not engage in any other business,
profession or occupation for compensation or otherwise
which would conflict or interfere in any
material respect with the rendition of such services either
directly or indirectly, without the prior written consent of the
Board; provided that nothing herein shall preclude
Executive, subject to the prior approval of the Board, from
accepting appointment to or continuing to serve on any board of
directors or trustees of any business corporation or any charitable
organization; provided in each case in the aggregate, that
such activities do not conflict or interfere with the performance
of Executive’s duties hereunder or conflict with
Section 10 and provided , further , that in any
event Executive shall be permitted to continue to serve on the
boards of directors of the business corporations set forth on
Schedule I attached hereto.
3. Base Salary . During the
Employment Term, the Company shall pay Executive a base salary at
the annual rate of $850,000, payable in substantially equal
periodic payments in accordance with the Company’s practices
for other executive employees, as such practices may be determined
from time to time. Executive shall be entitled to such increases in
Executive’s base salary, if any, as may be determined from
time to time in the sole discretion of the Board, which shall at
least annually review Executive’s rate of base salary to
determine if any such increase shall be made. Executive’s
annual base salary, as in effect from time to time hereunder, is
hereinafter referred to as the “ Base Salary
.”
4. Annual
Bonus . During the Employment Term, Executive shall be eligible
to earn an annual bonus award in respect of each fiscal year of the
Company (an “ Annual Bonus ”), in a target
amount equal to 100% of Executive’s Base Salary (the “
Target Bonus ”) (with a maximum opportunity equal to
150% (increasing in a linear progression for performance above 100%
and up to 150%) of Executive’s Base Salary, based upon
achievement of certain “stretch” targets to be
established by the Board annually in consultation with the
Executive), payable upon the Company’s achievement of certain
performance targets (of which no less than 67% shall be weighted
based on EBITDA (as such term is defined in the Equity Documents)
targets for each fiscal year of the Company (each, a “
Fiscal Year ”), with the balance of such targets to be
based on other metrics (which may include EBITDA-Cap Ex targets)
established by the Board after consultation with Executive,
pursuant to the terms of an incentive compensation plan to be
established by the Board promptly after the Effective Date (the
“ Incentive Plan ”). Notwithstanding the
foregoing, for fiscal year 2004, Executive’s Annual Bonus
shall be equal to 50% of Executive’s Base Salary, payable in
the first quarter of fiscal year 2005, upon the achievement of the
2004 EBITDA target set forth in the KKR/Reisch Financial Plan
(adjusted for certain non-recurring, non-operating or other
transaction-related items) attached hereto as Exhibit A .
All other Annual Bonuses shall be payable under the Incentive Plan
at such time(s) as annual bonuses are otherwise payable thereunder
and, in any event, within 2 1 / 2 months following the end of the
fiscal year in respect of which such bonus is earned.
5. Signing Bonus . On the
Effective Date, the Company paid to the Executive a cash signing
bonus of $600,000, which bonus Executive (net after the payment or
provision for applicable taxes and other amounts required by law to
be withheld) reinvested in Class A Common Stock as part of the
Executive’s Equity Participation as set forth in
Section 7 below.
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6. Employee Benefits; Business
Expenses .
a. Employee Benefits . During
the Employment Term, Executive and his dependents shall be entitled
to participate in the Company’s welfare benefit plans, fringe
benefit plans and qualified and nonqualified retirement plans (the
“ Company Plans ”) as in effect from time to
time as determined by the Board (collectively, the “
Employee Benefits ”), on the same basis as those
benefits are made available to the other senior executives of the
Company, at the level made available to the chief executive officer
position of the Company in accordance with the Company’s
policies as in effect from time to time.
b. Perquisites . During the
Employment Term, Executive shall be entitled to receive such
perquisites as are made available to the chief executive officer
position of the Company in accordance with the Company’s
policies in effect as of the date hereof. Executive shall be
entitled to not less than four weeks of paid vacation per annum,
which shall be subject to the Company’s vacation policy
applicable to the other senior executives of the Company, at the
level made available to the chief executive officer position of the
Company in accordance with the Company’s policies as in
effect from time to time.
c. Life Insurance . The
Company shall pay all premiums on a life insurance policy having a
death benefit equal to $10 million that will be payable to such
beneficiaries as may be designated by Executive, which life
insurance policy shall, to the extent attainable by the Company
using its commercially reasonable efforts, contain a provision
allowing for Executive, upon any termination of his employment, to
assume such policy at the same premium costs paid by the Company
prior to such termination (subject to such increases as may be made
in the ordinary course by the insurance company providing the
policy), such that the Executive may continue to receive coverage
under such life insurance policy thereafter at his own expense
(such policy, the “ Life Insurance Policy
”).
d. Business Expenses . During
the Employment Term, reasonable business expenses incurred by
Executive in the performance of Executive’s duties hereunder
shall be reimbursed by the Company in accordance with the
Company’s policies applicable to senior executive officers of
the Company.
7. Equity Participation
.
a. Executive (i) invested
$3,500,000 in cash to purchase shares of Class A Common Stock
and (ii) was granted an option to purchase 3.5 shares of
Class A Common Stock for every one share of the first
$3,500,000 of Class A Common stock the Executive initially
purchases, pursuant to the terms of the Equity Documents (as such
term is defined in Section 7(c) below). In each case described
in clauses (i) and (ii) above, the per share purchase
price was equal to, effectively (after taking into account any
recapitalization or other corporate restructuring that results in
or effects the per share price), the same price per share paid by
Fusion Acquisition LLC (the “ KKR Investor ”)
for its shares of Class A Common Stock purchased as of the
Effective Date.
b. In addition to the foregoing and
pursuant to the Equity Documents, upon the Effective Date,
Executive received a one-time grant of Class A Common Stock
having
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an aggregate value, as of the Effective Date,
equal to $1,000,000 (the “ Grant Shares ”),
which Class A Common Stock is 100% vested and nonforfeitable
by the Executive, but subject to the restrictions set forth in the
Equity Documents. Executive paid the Company the par value in
respect of the Grant Shares.
c. Executive’s equity
participation in the Company has been documented pursuant to the
2004 Stock Purchase and Option Plan for Key Employees of the
Company and its Subsidiaries (the “ Stock Option Plan
”) and in a Management Stockholders’ Agreement, Stock
Option Agreement, Restricted Stock Award Agreement and Sale
Participation Agreement, each as executed by the Executive, the
Company, and its shareholders, as applicable in such forms as are
attached hereto (such documents, collectively, the “
Equity Documents ”). The Company and Executive each
acknowledges that the terms and conditions of the aforementioned
documents govern Executive’s acquisition, holding, sale or
other disposition of Executive’s equity in the Company, and
all of Executive’s and the Company’s rights with
respect thereto.
8. Termination .
Executive’s employment hereunder may be terminated by either
party at any time and for any reason; provided that
Executive will be required to give the Employer at least 60 days
advance written notice of any resignation of Executive’s
employment without Good Reason (other than due to Executive’s
death or Disability). In the event that the Company terminates
Executive’s employment in accordance with the foregoing
sentence the Company may, in its sole discretion, prohibit
Executive from entering the premises of the Company for all or any
portion of the period after giving him notice of such termination.
Notwithstanding any other provision of this Agreement, the
provisions of this Section 8 shall exclusively govern
Executive’s rights upon termination of employment with the
Employer; provided , however, that nothing contained in this
Section 8 shall diminish Executive’s rights with respect
to the Equity Documents, which shall continue to govern
Executive’s equity holdings following any termination in
accordance therewith.
a. By the Employer For Cause or
By Executive Without Good Reason .
(i) The Employment Term and
Executive’s employment hereunder may be terminated by the
Employer for Cause (as defined below) and shall terminate
automatically upon Executive’s resignation without Good
Reason (other than due to Executive’s death or Disability);
provided that Executive will be required to give the
Employer at least 60 days advance written notice of such
resignation.
(ii) For purposes of this Agreement,
“ Cause ” shall mean (A) Executive’s
willful and continued failure to perform his material duties with
respect to the Employer or its subsidiaries as provided hereunder
which continues beyond 10 days after a written demand for
substantial performance is delivered to Executive by the Company;
(B) the willful or intentional engaging by Executive in
conduct that causes material and demonstrable injury, monetarily or
otherwise, to the Company or the Investors (as defined in the
Management Stockholders’ Agreement) or their respective
Affiliates (as defined in the Option Plan) ; (C) the
commission of a crime constituting (x) a felony under the laws
of the United States or any state thereof or (y) a misdemeanor
involving moral turpitude; or (D) a material breach of this
Agreement or any of the Equity Documents by Executive, including,
without limitation, engaging in any action in breach of the
restrictive covenants set forth in Section 10 and 11 of this
Agreement, which continues
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beyond 10 days after a written demand to cure
such breach is delivered to Executive by the Company (to the extent
that, in the Board’s reasonable judgment, such breach can be
cured); provided that any termination under clauses
(A) through (D) above for Cause shall require the
affirmative vote of two-thirds of the members of the Board (or such
higher percentage or procedures required under the Stockholders
Agreement, dated the Effective Date, among the Company and the
Investors (the “ Stockholders Agreement
”)).
(iii) If Executive’s
employment is terminated by the Employer for Cause, or if Executive
resigns without Good Reason (as defined in Section 8(c)),
Executive shall be entitled to receive:
(A) a lump sum payment of the Base
Salary that is earned by Executive but unpaid as of the Date of
Termination (as such term is defined in Section 8(d) below),
paid within ten (10) business days after the Date of
Termination;
(B) a lump sum payment of any Annual
Bonus that is earned by Executive but unpaid as of the Date of
Termination for any previously completed Fiscal Year, paid within
ten (10) business days after the Date of
Termination;
(C) a lump sum payment equal to all
vacation pay that is accrued in respect of Executive’s unused
vacation days as of the Date of Termination, paid within ten
(10) business days after the Date of Termination;
(D) reimbursement for any
unreimbursed business expenses incurred by Executive in accordance
with Company policy referenced in Section 6(d) above prior to
the Date of Termination (with such reimbursements to be paid
promptly after Executive provides the Company with the necessary
documentation of such expenses to the extent required by such
policy);
(E) if applicable, payment of the
Retirement Benefit (as such term is defined in Section 9
below) in accordance with the provisions of Section 9
below;
(F) if applicable, the transfer of
the Life Insurance Policy pursuant to Section 6(c) above;
and
(G) such Employee Benefits, if any,
as to which Executive may be entitled under the applicable Company
Plans upon termination of employment hereunder, (the payments and
benefits described clauses (A) through (G) hereof being
referred to, collectively, as the “ Accrued Rights
).
Following such termination of
Executive’s employment by the Employer for Cause or
resignation by Executive, except as set forth in this
Section 8(a)(iii), Executive shall have no further rights to
any compensation or any other benefits under this
Agreement.
b. Disability or Death
.
(i) Executive’s employment
hereunder shall terminate upon Executive’s death and may be
terminated by the Employer if Executive becomes physically or
mentally
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incapacitated and is therefore unable for a
period of six (6) consecutive months or for an aggregate of
nine (9) months in any eighteen (18) consecutive month
period to perform Executive’s duties (such incapacity is
hereinafter referred to as “ Disability ”). Any
question as to the existence of the Disability of Executive as to
which Executive and the Employer cannot agree shall be determined
in writing by a qualified independent physician mutually acceptable
to Executive and the Employer. If Executive and the Employer cannot
agree as to a qualified independent physician, each shall appoint
such a physician and those two physicians shall select a third who
shall make such determination in writing. The determination of
Disability hereunder shall be made in a writing that is promptly
provided to the Employer and Executive shall be final and
conclusive for all purposes of the Agreement.
(ii) Upon termination of
Executive’s employment hereunder for either Disability or
death, Executive or Executive’s estate (as the case may be)
shall be entitled to receive:
(A) the Accrued Rights;
and
(B) a lump sum payment of the pro
rata portion (based upon the number of days in the applicable
Fiscal Year during which Executive was employed with the Company
through the Date of Termination, relative to the number of days in
the applicable Fiscal Year) of the Annual Bonus, if any, that
Executive would have been entitled to receive pursuant to the
Incentive Plan in respect of the Fiscal Year in which the Date of
Termination occurs, paid within fifteen (15) days after the
Date of Termination.
Following Executive’s
termination of employment due to Executive’s death or
Disability, except as set forth in this Section 8(b)(ii),
Executive shall have no further rights to any compensation or any
other benefits under this Agreement.
c. By the Employer Without Cause
or by Executive for Good Reason .
(i) Executive’s employment
hereunder may be terminated (A) by the Employer without Cause
(which shall not include Executive’s termination of
employment due to his death or Disability) or (B) by Executive
for Good Reason (as defined below).
(ii) For purposes of this Agreement,
“ Good Reason ” shall mean (A) a reduction
in Executive’s rate of Base Salary or annual incentive
compensation opportunity (other than a general reduction in base
salary or annual incentive compensation opportunities that affects
all members of senior management of the Company equally, which
general reduction shall only be implemented by the Board after
consultation with Executive); (B) a material reduction in
Executive’s duties and responsibilities as set forth in
Section 2 above, an adverse change in Executive’s titles
as set forth in Section 2 above or the assignment to Executive
of duties or responsibilities materially inconsistent with such
titles; provided , however, in no event shall any of the
foregoing be deemed to occur by virtue of the removal of Executive
from the position of Chairman of the Board following the completion
of a Public Offering; or (C) a transfer of the
Executive’s primary workplace by more than fifty miles
outside of Armonk, New York; provided, however, that “Good
Reason” shall not be deemed to exist unless
Executive
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provides the Company with written notice setting
forth the event or circumstance giving rise to “Good
Reason” and the Company fails to cure such event or
circumstance within 30 days following the date of such
notice.
(iii) If Executive’s
employment is terminated by the Employer without Cause (including
by virtue of the Company’s failure to renew the Employment
Term at any time, but excluding by reason of Executive’s
death or Disability) or by Executive for Good Reason, Executive
shall be entitled to receive:
(A) the Accrued Rights;
(B) subject to Executive’s
continued compliance with the provisions of Sections 10 and 11,
(1) a lump sum payment equal to the pro-rated portion (based
upon the number of days in the applicable Fiscal Year during which
Executive was employed with the Company through the Date of
Termination, relative to the number of days in the applicable
Fiscal Year) of the Annual Bonus that Executive would otherwise
have been entitled to receive if he had remained employed through
the end of the Fiscal Year in which the Date of Termination occurs,
paid at such time as such Annual Bonus would otherwise have been
paid and (2) two times the sum of (x) the Base Salary at
the rate in effect immediately prior to the Date of Termination and
(y) the Target Bonus for the year in which the Date of
Termination occurs, payable in equal monthly installments over the
twenty-four (24) month period commencing on the Date of
Termination (the “ Severance Period ”);
provided , however , that the aggregate amount
described in this subsection (B) shall be reduced by any
amounts owed by Executive to the Company and any amounts for any
loans, or funds advanced, to, Executive in a manner consistent with
Section 17; and
(C) (1) continuation of welfare
benefits (pursuant to the same benefit plans as in effect for
active employees of the Company) until the earlier to occur of the
end of the Severance Period and the date on which Executive
commences to be eligible for coverage under comparable welfare
benefit plans from any subsequent employer, or (2) cash in an
amount that allows Executive to purchase equivalent welfare benefit
plan coverage for the Severance Period.
Following Executive’s
termination of employment by the Employer without Cause (including
by virtue of the Company’s failure to renew the Employment
Term at any time, but excluding by reason of Executive’s
death or Disability) or Executive for Good Reason, except as set
forth in this Section 8(c)(iii), Executive shall have no
further rights to any compensation or any other benefits under this
Agreement or under any other severance or termination benefit plan
maintained by the Company or its Affiliates.
d. Notice of Termination .
Any purported termination of employment by the Employer or by
Executive (other than due to Executive’s death) shall be
communicated by written Notice of Termination to the other party
hereto in accordance with Section 15(h)) hereof. For purposes
of this Agreement, a “ Notice of Termination ”
shall mean a notice which shall indicate the specific termination
provision in this Agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a
basis for termination of
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employment under the provision so indicated. For
purposes of this Agreement, the “ Date of Termination
” shall mean the date the Notice of Termination is given to
the respective party; provided, however, that (i) with respect
to a termination for Cause by the Company, the Date of Termination
shall not occur prior to the expiration of any applicable Cure
Period and (ii) upon a nonrenewal of the Employment Term by
either party, the date the Employment Term expires, and not the
date of the notice itself, shall constitute the applicable Date of
Termination.
e. Board/Committee
Resignation . Upon termination of Executive’s employment
for any reason, Executive agrees to resign, as of the date of such
termination and to the extent applicable, from the Board (and any
committees thereof) and the board of directors (and any committees
thereof) of any of the Company’s Affiliates.
9. Retirement Benefit
.
a. If Executive’s employment
with the Employer terminates for any reason after December 31,
2009 (such period of employment, the “ Service Period
”), Executive shall be eligible to receive payment of an
annual retirement benefit from the Company, payable to Executive
for his lifetime and commencing on the later to occur of
(i) the date on which Executive achieves age 60 or
(ii) such later date as Executive’s employment with the
Employer terminates for any reason (the “ Retirement
Benefit ”). The Retirement Benefit shall equal:
(x) 10% of the average of the sums of each of
Executive’s Base Salary plus cash Annual Bonus (excluding any
transaction, signing or other non-recurring special bonuses) paid
or payable to Executive in respect of the last five full fiscal
years ended prior to the Date o
