Exhibit 10.17
APPLETON PAPERS
INC.
TERMINATION PROTECTION
AGREEMENT
AGREEMENT dated as of
, between Appleton Papers Inc. (the “Corporation”) and
(the “Executive”). Unless otherwise indicated, terms
used herein and defined in Schedule A shall have the meanings
assigned to them in Schedule A.
WHEREAS , the Corporation desires to continue to attract
and retain skilled and dedicated management employees, by providing
post-employment benefits in the event of certain terminations of
employment; and
WHEREAS , the Corporation has employed the Executive in
the capacity of
at Appleton, Wisconsin upon the terms and conditions currently
reflected in Executive’s personnel file or in various minutes
of the Board of Directors; and
WHEREAS , Executive has specific duties and unique
talents which are of benefit to the Corporation;
NOW, THEREFORE
, it is agreed as
follows:
This Agreement shall become
effective as of
(the “Effective Date”) and shall remain in effect from
time to time thereafter. The Corporation may terminate this
Agreement by giving the Executive at least eighteen
(18) months advance written notice of termination of the
Agreement. Notwithstanding the foregoing, this Agreement shall, if
in effect on the date of a Change of Control, remain in effect for
at least two (2) years following such Change of
Control.
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2.
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Notice of
Termination of Employment .
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The Executive agrees to give the
Corporation at least two (2) months’ written advance
notice of Executive’s voluntary termination of employment,
other than for Good Reason, if such termination occurs prior to a
Change of Control.
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3.
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Benefits
Payable Upon Termination of Employment .
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(a)
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General Rule.
In the event that, at any time other than within two (2) years
after a Change of Control, the Corporation terminates the
employment of the Executive with the Corporation other than for
misconduct or Permanent Disability, or the Executive terminates
employment for Good Reason, the Executive shall receive from the
Corporation, provided the Executive executes the release described
in Paragraph 3(d) below:
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(i)
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an annual
amount, equal to the Executive’s Base Salary, payable for
each of the eighteen (18) months following termination of
employment in equal installments at the times set forth in the
Corporation’s payroll policy, as in effect at the time of
payment;
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(ii)
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reimbursement
of reasonable expenses incurred by the Executive for professional
outplacement services by qualified consultants after termination of
employment; and
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(iii)
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until the
earlier of (A) eighteen (18) months following the date of
termination of employment; or (B) the date on which the
Executive is employed by a new employer, medical and dental
benefits at the level provided immediately prior to the termination
of employment date. Any statutory rights of the Executive to
continued health coverage shall be governed by the
Executive’s actual date of termination and not by the
expiration of the salary continuation period.
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(b)
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Termination
Within Two (2) Years After a Change of Control
. In the event that within two
(2) years after a Change of Control, the Corporation
terminates the employment of the Executive, other than for
misconduct or Permanent Disability, or the Executive terminates
employment for Good Reason, the Executive shall receive from the
Corporation, within two (2) business days after such
termination:
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(i)
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an amount in
cash equal to the product of two (2), multiplied by the sum of the
Executive’s Base Salary and Target Bonus;
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(ii)
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an amount in
cash equal to the product of (A) Executive’s Target
Bonus and (B) a fraction, the numerator of which is the number
of days in the Corporation’s fiscal year that occurred prior
to the Executive’s termination of employment and the
denominator of which is 365 representing a partial bonus for the
year of termination, less any partial bonus related to the same
fiscal year previously paid to the Executive;
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(iii)
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if the bonus
amounts for the Corporation’s fiscal year ending prior to the
Executive’s termination date have not, prior to such
termination, been paid to Corporation executives generally, an
amount in cash equal to the unpaid bonuses under the
Corporation’s annual executive bonus program, based on actual
Corporation performance during such fiscal year;
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(iv)
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reimbursement
of reasonable expenses incurred by the Executive for professional
outplacement services by qualified consultants after termination of
employment; and
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(v)
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until the earlier of twenty-four
(24) months following the date of termination of employment or
the date on which the Executive is employed by a new employer,
medical and dental benefits at the level provided immediately prior
to the Change of Control. After Executive is employed by a new
employer these benefits shall remain
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in effect for the term established
above, but shall become secondary to any such benefits offered by
the new employer (i.e. they will be offset by such new
employer’s benefits).
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(c)
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Termination
for Misconduct .
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Nothing in this Agreement shall be
construed to prevent the Corporation from terminating
Executive’s employment under this Agreement for misconduct.
Such termination shall relieve the Corporation of its obligation to
make any other payments under this Agreement, except those that may
be otherwise payable under then existing employee benefit plans,
programs and arrangements of the Corporation.
To be eligible for and receive the
benefits described in subparagraphs (a) or (b) of this
Paragraph 3, Executive must, at the time of termination of
employment, irrevocably execute a Release form prescribed by the
Corporation, file it with the person, and within the time period,
the Corporation prescribes, and the Release must be enforceable in
all respects. The purpose of the Release is to release the
Corporation from all claims and liability arising out of the
employment relationship with the Corporation, including without
limitation, claims arising under the Age Discrimination in
Employment Act (“ADEA”), Title VII of the Civil Rights
Act of 1964, and all other federal, state, local or other laws,
regulations or rules, whether arising from statute or the common
law, or in law or equity. The Release shall be in a form that
complies with regulations promulgated by the Equal Employment
Opportunity Commission (“EEOC”).
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4.
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Mitigation;
Non-Compete .
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(a)
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If the
Executive’s termination of employment occurs at any time
other than within two (2) years after a Change of
Control:
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(i)
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the amount of
the payments under Paragraph 3(a)(i) will be reduced by the amount
of any gross compensation the Executive is entitled to receive,
whether or not deferred, during the eighteen (18) month period
following the termination, from any other source of employment,
which term, for purposes of this Agreement, includes
self-employment. Provided the Executive is not in violation of the
requirements of Paragraph 5 or this Paragraph 4, the reduction
described in the preceding sentence will not apply during the
twelve (12) month period beginning on the day following the
Executive’s termination of employment hereunder. As a
condition to receiving the payments under Paragraph 3(a)(i), the
Corporation may require certification of the Executive’s
employment status and the Corporation may require, in the event of
the Executive’s other employment, proof, in a form acceptable
to the Corporation, of the Executive’s rate of gross
compensation from the Executive’s new employer.
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(ii)
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the
Corporation’s obligation to make payments under Paragraph
3(a) shall cease completely and immediately if, without its prior
written consent, at any time before all such payments have been
made as scheduled, the Executive shall directly or indirectly
(whether as a shareholder, owner, partner, consultant, employee, or
otherwise), engage in any of the “major businesses” in
which the Corporation or its subsidiaries are engaged. A
“major business” for this purpose is any business
segment of the Corporation (e.g. carbonless copy paper, thermal
paper, or other business segments) on the date of termination of
employment that produced in the last fiscal year of the Corporation
which ended before the termination occurred, or is projected to
produce in the fiscal year in which the termination occurs or in
either of the two succeeding fiscal years after the date of
termination, more than 5% of the revenues of the Corporation. For
this purpose, the Executive shall be deemed not a
shareho
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