EMPLOYMENT AGREEMENT

 

 

                                                                   Exhibit 10.28

 

                              EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT is made and entered into on this 7th day of January,

2004, BETWEEN:

 

      (1)   Crompton Corporation, a Delaware corporation with offices located at

            199 Benson Road, Middlebury, Connecticut 06749 (the "Company"); and,

 

      (2)   Robert L. Wood, residing at _____________________ ("the Employee").

 

THE COMPANY AND THE EMPLOYEE HEREBY AGREE, in consideration of the mutual

obligations and covenants set forth below, to the following terms and conditions

(all of which are subject to and not effective until ratification by the

Company's Board of Directors):

 

1.    Employment

 

The Company shall employ the Employee as its President and Chief Executive

Officer, effective January 12, 2004, subject to approval by its Board of

Directors and subject to the terms and conditions specified in this Employment

Agreement ("the Employment"). In addition, Company shall nominate Employee as a

member of its Board of Directors effective January 12, 2004, subject to approval

by its Board of Directors and subject to the terms and conditions specified in

this Employment Agreement ("the Employment").

 

2.    Place Of Employment

 

The Employment shall be based in Company's headquarters offices, currently

located at 199 Benson Road, Middlebury, Connecticut 06749.

 

3.    Duties

 

      3.1   The Employee shall devote all of his time, attention, and best

            efforts to the Company's business. The Employee shall faithfully and

            diligently perform the duties and responsibilities assigned to him

            by the Company. The Employee shall use his best efforts, judgment,

            and energy to improve and advance the business and interests of the

            Company in a manner consistent with the duties of the Employee's

            position.

 

      3.2   The Employee agrees to comply with all federal, state, and local

            laws applicable to his Employment. The Employee also agrees to

            comply with all of the Company's rules, regulations, and policies in

            force during the Employment.

 

4.    Exclusivity of Service

 

While employed by the Company, the Employee shall devote his entire working

time, attention, and energies to the Company's business.

 

5.    Compensation and Benefits

 

      5.1   The Company shall pay the Employee a base gross salary ("Salary") of

            seven-hundred and eighty

 

 

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            thousand dollars ($780,000) per year, payable in equal gross monthly

            installments of sixty-five thousand dollars ($65,000). The Company

            may make deductions or withholdings as required by applicable laws

            and policies, or as may be or has been consented to by the Employee.

            The Company shall review and, in its sole discretion, adjust

            Employee's Salary on an annual basis, provided that the Salary shall

            not be reduced below the initial level set forth in this Employment

            Agreement.

 

      5.2   The Employee shall also be entitled to earn an annual incentive

            bonus of up to 160% of base salary, with a target of 100% of Salary.

            The performance goals required to earn the annual incentive bonus

            shall be approved by the Board of Directors and communicated to the

            Employee, and shall be consistent with the Company's existing

            policies for similarly-situated key executives.

 

      5.3   The Employee shall also be granted stock options to acquire five

            hundred thousand (500,000) shares of the Company's common stock on

            January 19, 2004 (in lieu of any grants in October of 2004 which

            would pertain to 2005), fifty percent of which will vest and become

            exercisable on January 19, 2005 and the remaining fifty percent will

            vest and become exercisable on January 19, 2006. The foregoing stock

            options shall otherwise have the normal terms and conditions

            applicable to the stock options granted to other key executives of

            the Company under the Company's 1998 Long Term Incentive Plan in its

            present or subsequently amended form.

 

      5.4   The Employee shall also be granted a total of two hundred thousand

            (200,000) shares of restricted stock on January 19, 2004, one-third

            of which will vest each successive year following the grant until

            said shares are fully vested (subject to Board of Directors approval

            and Employee still being employed by the Company). Any and all

            dividends will accrue to the benefit of the Employee, and Employee

            shall be solely responsible for all taxes related to the stock

            grants or exercises thereof under Sections 5.3 and 5.4 of this

            Agreement. The foregoing restricted stock grant shall otherwise have

            the normal terms and conditions applicable to the restricted stock

            granted to other key executives of the Company under the Company's

            1998 Long Term Incentive Plan in its present or subsequently amended

            form.

 

      5.5   The Company shall also provide Employee with reimbursement for

            reasonable temporary living expenses in Connecticut during and up to

            the conclusion of the first six months of this Employment Agreement,

            provided that in no event shall Company's obligation in this regard

            exceed six months of temporary living expenses. The provision of

            this reimbursement, as well as the types of expenses which shall

            qualify, shall at all times be governed by Company's policies

            regarding temporary living or as the Board of Directors may

            determine.

 

      5.6   The Employee shall also be eligible to participate in any vacation,

            life, disability or other similar insurance plans, medical and

            dental plans or other employee welfare benefit plans that may be

            provided by the Company for its key executives, in accordance with

            the provisions of any such plans.

 

      5.7   The Company shall, in accordance with and to the extent of its

            policies, pay ordinary and necessary business expenses incurred by

            the Employee in performing his duties as a key executive, as well as

            reasonable membership fees and reasonable business use charges at a

            minimum of one (1) club of the Employee's choosing (and a maximum

            number and type as otherwise determined by the Company's Board of

            Directors). The Employee shall account promptly for all such

            business expenses in the manner prescribed by the Company and shall

            submit, on request, all records necessary to confirm that the

            Employee's business use of any club is more than fifty percent (50%)

            of the Employee's total use of such club.

 

      5.8   During the Term (as defined herein below in Section 10.1 of this

            Agreement), the Employee shall

 

 

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            be entitled to use of an automobile of his choice, the gross value

            of which is not to exceed sixty-thousand dollars ($60,000), which

            shall be leased by the Company.

 

      5.9   The Employee shall be entitled to certain financial assistance

            (brokerage fees, etc.) in connection with the sale of his current

            residence outside of Connecticut, consistent with the terms of

            Company's relocation policies. By way of clarification, Employee

            understands that Company shall have no obligation to purchase

            Employee's current home or loan Employee money to purchase a new

            home.

 

      5.10  The Company intends to take such actions as may be reasonably

            practicable so that its ability to take federal income tax

            deductions with respect to the exercise of the options provided for

            above is not limited by the application of Section 162(m) of the

            Internal Revenue Code of 1986, as amended. However, Employee

            acknowledges that it may not be feasible for the Company to preserve

            full deductibility, and he therefore agrees to cooperate with the

            Company in arranging to defer, under a mutually agreeable plan of

            deferred compensation, receipt of shares of the Company's common

            stock otherwise deliverable in connection with his exercise of such

            options if and to the extent necessary to preserve such

            deductibility.

 

      5.11  Employee agrees to buy the Company's common stock with his own funds

            from the Company at a timing and in an amount determined by the

            Company's Board of Directors consistent with the Company's policies

            and practices in such regard for similarly-situated key executives.

            Employee also agrees to hold such stock for a minimum period of time

            as established by the Company's Board of Directors consistent with

            the Company's policies and practices in such regard for

            similarly-situated key executives.

 

6.    Reasonableness of Restrictions

 

The Employee acknowledges that, during the term of Employment, the Company will

provide the Employee with the use of and access to trade secrets and

confidential information. In turn, the Employee recognizes that, while

performing his duties hereunder he will have access to and come into contact

with trade secrets and confidential information belonging to the Company and

will obtain personal knowledge of and influence over its customers and/or

employees. The Employee therefore agrees that the restrictions contained in

Sections 7, 8, and 9 are reasonable and necessary to protect the legitimate

business interests of the Company both during and after the termination of the

Employment.

 

7.    Confidentiality

 

      7.1   The Employee shall neither during the Employment (except in the

            proper performance of his duties) nor at any time (without limit)

            after the termination thereof, howsoever arising, directly or

            indirectly:

 

            7.1.1       use for his own purposes or those of any other person,

                        company, business entity, or other organization

                        whatsoever, or,

 

            7.1.2       disclose to any person, company, business entity, or

                        other organization whatsoever,

 

            any trade secrets or confidential information relating or belonging

            to the Company, including but not limited to any such information

            relating to clients or customers, client or customer lists or

            requirements, market information, business plans or dealings,

            financial information and plans, trading models, market access

            information, research activities, any document marked Confidential,

            or any information which the Employee has been told is Confidential

            or which he might reasonably expect the Company would regard as

            Confidential, or any information which has been given the Company in

            confidence by customers, suppliers, or other persons. Even if a

            document has not been marked "Confidential," the Employee shall

            treat the document and its contents as confidential information if

 

 

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            the Employee has been told or otherwise knows or reasonably should