Exhibit 10.3
AMENDED AND RESTATED
EARNINGS SHARE UNITS AGREEMENT
     This amended and restated earnings share units agreement is dated
February 27, 2006, and is between SOUTHERN CONTAINER CORP., a Delaware
corporation with offices at 115 Engineers Road, Hauppauge, New York 11788
(“Company”) and JAMES B. PORTER III, residing at 4 Seashell Lane, Northport, New
York 11768-1415 (“Executive”).
RECITALS
     Company and Executive are parties to an Earnings Share Units Agreement,
dated as of January 1, 2001 (as amended, the “Prior Agreement”), pursuant to
which Company granted to Executive Earnings Share Units (as defined in the Prior
Agreement) to furnish additional incentive for Executive to perform exceptional
services, devote maximum ability and industry to the success of Company’s
business and equate his interests with those of the shareholders of Company.
     Company and Executive desire to amend and restate the Prior Agreement in
its entirety, as hereinafter set forth.
     The parties hereto agree as follows:
     1. Definitions.
          1.1 Except as set forth herein, each accounting term not defined in
this Agreement has the meaning given such term under generally accepted
accounting principles applied on a consistent basis.
          1.2 “Accumulated Earnings Share” means the aggregate, cumulative
amount standing to Executive’s credit in Executive’s ESU Account, as of the date
upon which the Accumulated Earnings Share is determined, plus the amount, if
any, to be credited to Executive’s ESU Account pursuant to Section 1.9 but
which, as of such date, has not been determined and/or recorded therein.
          1.3 “Change of Control” means if Grossman Family Members do not own or
otherwise control, directly or indirectly, at least 50% of the ownership
interests in Company or in any entity that succeeds to all or substantially all
of the assets of Company.
          1.4 “Employment Agreement” means the Amended and Restated Employment
Agreement, dated as of January 1, 2006, between Company and Executive, as
amended.
          1.5 “Escrow Agent” means the administrative agent designated pursuant
to Company’s principal credit facility (or, if there is no administrative agent,
the financial institution extending the largest loan commitment to Company) or
such other financial institution, law firm or other entity as Company and
Executive agree.
          1.6 “Escrow Agreement” means an escrow agreement substantially in the
form attached hereto as Exhibit “A”.
          1.7 “ESU Cessation Date” means December 31, 2011.
          1.8 “Executive’s Earnings Base” means the Net Income (whether positive
or negative) with respect to each complete fiscal year of Company (commencing
with the fiscal year ending December 2000) and continuing up to, but not
including, the fiscal year in which a Termination Event or Change of Control
occurs, divided by 1,000,000, and multiplied by the number of Units granted as
of the end of such complete fiscal year.

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          1.9 “Executive’s ESU Account” means the record to be maintained by
Company in which, promptly after the Independent Auditors determine the Net
Income for a fiscal year, Company will record Executive’s Earnings Base for said
fiscal year (i.e. a credit if the Net Income was positive, or a debit if the Net
Income was negative).
          1.10 “Gross Cause” means Executive’s fraud, gross misconduct, gross
negligence, disloyalty, gross insubordination, breach of trust, breach of any
material provision of the Employment Agreement or of the Letter Agreement and
any other similar causes; provided that after a Change in Control, none of such
acts, other than fraud and material breach of the Letter Agreement, will
constitute Gross Cause unless the act is material and Executive has been
informed, in writing, of such act and provided with a reasonable opportunity for
cure, if the act is subject to cure, consisting of at least 10 days.
          1.11 “Grossman Family Members” means Steven and Robert Grossman,
members of their immediate families, Trustees under Trust(s) for the benefit of
any of them, and the personal representatives of any of the foregoing.
          1.12 “Independent Auditors” means the certified public accountants
authorized by the Board of Directors of Company to audit its books.
          1.13 “Letter Agreement” has the meaning given such term in Article 4.
          1.14 “Net Income” means the annual consolidated net pre-tax operating
income of Company, as determined by the Independent Auditors. Such determination
will be made in accordance with generally accepted accounting principles and
practices, and will, in all respects, be binding and conclusive on the parties
hereto. Without limiting the generality of the foregoing sentence, in computing
Net Income, all non-operating profits and losses (including, without limiting
the generality of the foregoing, LIFO inventory adjustments and gains or losses
on the sale or other disposition of capital assets or other Extraordinary Gains
or Losses) will be disregarded.
          1.15 “Outstanding Indebtedness” means, at a given date, the then
outstanding indebtedness (including principal, interest and other sums) owed to
Company on account of any loans made by Company to Executive or Executive and
Pamela S. Porter.
          1.16 “Solvay” means Solvay Paperboard LLC, a Delaware limited
liability company.
          1.17 “Solvay Accumulated Earnings Share” has the meaning given such
term in Section 2.2.
          1.18 “Successor” means if the Change of Control occurs due to
(i) Company transferring all or substantially all of its assets, the entity
acquiring such assets, (ii) Company merging (where it is not the surviving
entity) or consolidating with another entity, such other entity, and (iii) a
transfer of ownership interests by Grossman Family Members, Company.
          1.19 “Termination Event” means the earlier of (a) the termination of
Executive’s employment with Company; or (b) the occurrence of the ESU Cessation
Date.
          1.20 “Units” and “Earnings Share Units” mean the Earnings Share Units
granted to Executive by Company as described in Article 2.
     2. Grant of Earnings Share Units; Credit for Prior Accumulated Earnings
Share; Annual Statement.

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          2.1 Grant of Units. Company granted to Executive 6,000 Units on
December 30, 2000 and 2,000 Units on the last day of each of fiscal year 2001
and 2002, for a total of 10,000 Units in the aggregate. Such Units will be
payable at the times and in the manner provided in Articles 3 and 5.
Notwithstanding anything to the contrary contained in this Agreement,
(x) Executive’s ESU Account will not be credited or debited for periods after a
Termination Event; and (y) if a Change of Control occurs prior to the ESU
Cessation Date, Executive’s ESU Account will be credited (but not debited) for
the Continuation Period (as defined in Section 5.1(b)), if any, during which
Executive renders services for the Successor, which credit, if any, will be paid
by Company if and when the balance of the Escrow Fund (as defined in the Escrow
Agreement) is released by the Escrow Agent to Executive or will be retained
Company if and when the balance of the Escrow Fund is released by the Escrow
Agent to Company. If the Change of Control is due to an asset sale, or Company
does not continue to conduct its business as a separate legal entity during the
Continuation Period, a good faith estimate will be made by Company as to what
the Net Income would have been during the Continuation Period as if Company
continued to be operated under the same organizational structure as existed
immediately prior the Change of Control.
          2.2 Credit for Prior Accumulated Earnings Share. Executive and Solvay
were parties to a certain Amended and Restated Earnings Share Units Agreement
dated as of April 1, 1999 (the “Solvay ESU Agreement”). As of January 1, 2000,
Executive’s Accumulated Earnings Share, as defined in the Solvay ESU Agreement,
was $173,082 (the “Solvay Accumulated Earnings Share Amount”). Pursuant to
Article 3 of the Prior Agreement, Company agreed, as of January 1, 2000, to
credit Executive’s ESU Account with an amount equal to the Solvay Accumulated
Earnings Share Amount, in consideration of which Executive agreed that the
Solvay ESU Agreement was terminated and of no force or effect, and that Solvay
has no further obligation or liability to Executive thereunder.
          2.3 Annual Statement. No later than 120 days after the end of each
fiscal year, Company will furnish to Executive a statement setting forth in
reasonable detail Executive’s Earnings Base for such fiscal year and the
Accumulated Earnings Share as of the end of such fiscal year.
     3. Payment of Accumulated Earnings Share upon Termination of Employment or
ESU Cessation Date.
          3.1 Occurrence of Death or Disability; ESU Cessation Date; Termination
without Gross Cause.
               3.1.1 If, prior to a Change of Control, Executive’s employment by
Company is terminated by reason of Executive’s death, Company will pay the
Accumulated Earnings Share as of Executive’s death (net of applicable income and
employment taxes and subject to Section 3.3) to such beneficiary or
beneficiaries as Executive designated in a written notice filed with the
Secretary of Company (the last such notice to govern) or, if no such designation
was so filed, to Executive’s estate. Such amount will be paid in full within
30 days after Executive’s death (provided that if payment is made to Executive’s
estate, it will be paid in full within 30 days after Company is presented with
evidence of the appointment and qualification of the representative’s of
Executive’s estate), and in all other respects this Agreement and all rights of
Executive hereunder will automatically be deemed terminated and of no force or
effect and Company will have no further obligation or liability to Executive or
his estate hereunder.
               3.1.2 If, prior to a Change of Control and while Executive is
employed by Company, (i) the ESU Cessation Date occurs; (ii) Executive’s
employment by Company is terminated by reason of Executive’s permanent
disability; or (iii) Executive’s employment by Company is terminated by Company
without Gross Cause, Company will pay to Executive the Accumulated Earnings
Share as of such event (net of applicable income and employment taxes and
subject to Section 3.3). Such amount will be paid in full within 30 days after
such event, and in all other respects this Agreement (other than Article 4) and
all

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rights of Executive hereunder will automatically be deemed terminated and of no
force or effect and Company will have no further obligation or liability to
Executive hereunder.
               3.1.3 If the parties disagree as to whether Executive suffered a
permanent disability, the dispute will be resolved by a panel of three medical
doctors, one selected by Company, the second by Executive and the third by the
two medical doctors so selected. Such arbitration will be conducted in Suffolk
County, New York in accordance with the Commercial Arbitration Rules of the
American Arbitration Association then obtaining and the award rendered will be
binding and conclusive upon Company and Executive.
          3.2 Termination by Executive Prior to ESU Cessation Date or by Company
for Gross Cause. If prior to a Change of Control, Executive’s employment by
Company is terminated by Company for Gross Cause or by Executive for any reason
other than due to his death or permanent disability, then all Units granted as
of such termination will lapse and be forfeited and canceled and Executive will
thereafter have no right to receive any payment with respect thereto or to be
granted Units thereafter, and this Agreement (other than Article 4) and all
rights of Executive hereunder will automatically be deemed terminated and of no
further force or effect and Company will have no further obligation or liability
to Executive hereunder. Notwithstanding the foregoing, within 30 days after such
termination, Company will pay to Executive the Solvay Accumulated Earnings Share
in full.
          3.3 Adjustment to Accumulated Earnings Share. Notwithstanding anything
contained in this Agreement to the contrary, within 45 days after Company
receives the determination of the Net Income for the fiscal year during which a
Termination Event occurs, the amount payable to Executive hereunder, if any,
will be adjusted by multiplying (i) the amount that would have been Executive’s
Earnings Base, with respect to such fiscal year, had the Termination Event not
occurred until the first day of the next succeeding fiscal year, by (ii) a
fraction, the numerator of which will be the total number of days that elapsed
between the commencement of the calendar year in which the Termination Event
occurs and the date of such Termination Event, and the denominator of which will
be 365. The amount so computed will then be added or subtracted (depending upon
whether a credit or a debit) to or from the amount to be paid by Company under
Subsection 3.1.1 or 3.1.2, as the case may be. If the Accumulated Earnings Share
has been paid in full at the time of such adjustment, Company will pay Executive
(or if applicable, Executive’s estate) such amount (if a credit) within 30 days
after such adjustment, or Executive (or his estate) will repay such amount to
Company (if a debit) within 30 days after Company’s demand therefore, as the
case may be.
          3.4 Example. Exhibit “B” sets forth an example of the operation of
Sections 1.2, 1.8, 1.9 and 3.1.
     4. Non-Competition, Non-Solicitation and Confidentiality. Executive has
executed and delivered to Company and Solvay a letter agreement, dated as of the
date hereof, containing certain provisions with respect to his competing with
Company’s and Solvay’s businesses, his solicitation of Company’s and Solvay’s
customers and employees and his obligation not to disclose confidential matters
(the “Letter Agreement”). Executive hereby ratifies and confirms his obligations
under the Letter Agreement. As a condition to the receipt of payments hereunder,
Executive agrees that, in addition to and without limiting the continuing
effectiveness of the Letter Agreement so long as he is bound thereby, the
provisions of the Letter Agreement are deemed incorporated in this Agreement by
reference as though fully set forth herein and he will comply therewith
throughout the term of his employment by Company and after termination thereof
so long as the Letter Agreement remains in effect. In the event of any breach of
the foregoing by Executive, then, in addition to and without limiting any other
remedies that Company and Solvay may have, all Units granted as of such
termination will lapse and be forfeited and canceled and Executive will
thereafter have no right to receive (or to continue to receive) any payment with
respect thereto and this Agreement and all rights of Executive hereunder will
automatically be deemed terminated and of no further force or effect and Company
will have no further obligation or liability to Executive hereunder.

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     5. Change of Control.
          5.1 If a Change of Control occurs while Executive is employed by
Company and:
               (a) the Successor does not request prior to the Change of Control
that Executive remain in the Successor’s employ under terms described in
Section 5.1(b), or the Change of Control occurs after the ESU Cessation Date,
then Company will pay to Executive the Accumulated Earnings Share as of the
Change of Control (net of applicable income and employment taxes and subject to
Section 5.2). Such amount will be paid in full within 30 days after the Change
of Control and in all other respects this Agreement (other than Article 4) and
all rights of Executive hereunder will automatically be deemed terminated and of
no force or effect and Company will have no further obligation or liability to
Executive hereunder; or
               (b) the Successor requests prior to the Change of Control that
Executive remain in the Successor’s employ for a period of up to 12 months after
the Change of Control, as determined by the Successor, but in no event beyond
the ESU Cessation Date (such period selected by the Successor being called the
“Continuation Period”), in the county of Kings, Queens, Nassau, New York or
Suffolk, New York, and in a position, and with compensation, duties and other
terms of employment substantially comparable to those in effect immediately
prior to the Change of Control, and Executive agrees to accept such employment,
then (x) Company, Executive and Escrow Agent will execute and deliver to each
other the Escrow Agreement, and (y) Company will deposit with Escrow Agent an
amount equal to the Accumulated Earnings Share as of the date of the Change of
Control (net of applicable income and employment taxes and subject to
Section 5.2), to be held and disbursed by Escrow Agent in accordance with the
terms of the Escrow Agreement, and in all other respects this Agreement (other
than Article 4) and all rights of Executive hereunder will automatically be
deemed terminated and of no force or effect and Company will have no further
obligation or liability to Executive hereunder; or
               (c) the Successor requests prior to the Change of Control that
Executive remain in the Successor’s employ under the terms described in
Section 5.1(b) and Executive fails or refuses to accept such employment, for any
reason whatsoever, then all Units will lapse and be forfeited and canceled and
Executive will thereafter have no right to receive any payment (or further
payment) with respect thereto, and this Agreement (other than Article 4) and all
rights of Executive hereunder will automatically be deemed terminated and of no
further force or effect and Company will have no further obligation or liability
to Executive hereunder.
          5.2 Within 45 days after Company receives the determination of the Net
Income for the period commencing with the first day of the fiscal year during
which the Change of Control occurs and terminating on the date of the Change of
Control (the “Applicable Net Income”), the Accumulated Earnings Share as of the
Change of Control will be increased or decreased (depending upon whether a
credit or a debit) by an amount equal to the Applicable Net Income divided by
1,000,000, and multiplied by the number of Units granted as of the Change in
Control. If such amount is a credit, and (x) Escrow Agent has disbursed all
funds under the Escrow Agreement at the time Company receives such
determination, Company will pay such credit to Executive within 30 days
thereafter, or (y) Escrow Agent has not disbursed all funds under the Escrow
Agreement at the time Company receives such determination, within 30 days
thereafter Company will pay such credit to Escrow Agent to be held and disbursed
by it pursuant to the Escrow Agreement. If such amount is a debit, and
(x) Escrow Agent is holding an amount equal to or less than the amount of the
debit, Company will be entitled to be paid the entire balance held by the Escrow
Agent and Executive will repay the amount of the debit in excess of the funds
being held by Escrow Agent within 30 days after Company’s demand therefore, or
(y) Escrow Agent is holding more than the amount of the debit, Company will be
entitled to be paid the amount of the debit by the Escrow Agent within 30 days
after Company’s demand therefore.
     6. No Right of Employment. Nothing in this Agreement will: (a) confer upon
Executive any right to continue in the employ of Company or a Successor or
obligate Company or a Successor or Executive

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to continue Executive’s employment; or (b) subject to the terms of the
Employment Agreement, interfere with the right of Company, a Successor or
Executive to terminate Executive’s employment at any time or for any reason.
     7. General Provisions.
          7.1 Notices. All notices given hereunder must be in writing and sent
by certified mail, return receipt requested, or by nationally recognized
overnight courier, addressed to the party intended to receive the same at its or
his address set forth above, or at such other address or to such designee as
such party designates by a notice given in the manner herein provided. Each such
notice will be deemed given on the date it is delivered or its delivery is
refused if given in accordance with this Section 7.1.
          7.2 Invalid Provisions. The invalidity or unenforceability of any
provision of this Agreement will not affect the validity or enforceability of
any one or more of the other provisions of this Agreement.
          7.3 Assignment; Binding Effect; Survival. Executive may not assign
this Agreement or any of his rights or obligations hereunder. This Agreement is
binding upon and will inure to the benefit of Executive and his heirs,
distributees and legal representatives. This Article 7 will survive termination
of this Agreement.
          7.4 Entire Agreement; Waiver; Remedies; Governing Law; Etc. This
agreement (with the Employment Agreement and the Letter Agreement) constitutes
the entire agreement between the parties concerning the subject matter hereof
and there are no agreements or representations with respect hereto except as
contained herein. This Agreement supersedes any other or prior employment or
compensation agreement between the parties with respect to the subject matter
hereof, including the Prior Agreement. This Agreement may not be amended nor any
of its provisions waived, except by a writing signed by the parties hereto. A
waiver of any of the terms or conditions of this Agreement, or any breach
thereof, will not be deemed a waiver of such term or condition for the future,
or of any other term or condition, or of any subsequent breach thereof. This
Agreement (and any claims or controversies arising out of or relating to this
Agreement) will be governed by the law of the State of New York. Wherever
reference is made to the acknowledgment, agreement, approval, consent, demand,
determination, election or request by a party or parties hereto, the same must
be in writing.
          7.5 Descriptive Headings; References. Descriptive headings herein are
for convenience only and will in no way define, limit or affect this Agreement.
References to Articles and Sections refer to the Articles and Sections of this
Agreement unless otherwise indicated.
          7.6 Legal Fees. If any litigation is commenced by either party against
the other to enforce any provision of this Agreement or the Escrow Agreement, or
by Company against Executive to enforce any provision of the Letter Agreement,
the prevailing party will be entitled, in addition to such other relief as may
be granted, to a reasonable sum as and for his or its attorneys’ fees and costs
and court costs in such litigation which will be determined by the court in such
litigation or in a separate action brought for that purpose.
          7.7 Amendment and Restatement. Company and Executive hereby agree that
upon execution of this Agreement, the terms and provisions of the Prior
Agreement will be and hereby are amended and restated in their entirety by the
terms and conditions of this Agreement, and the terms and provisions of the
Prior Agreement will be and hereby are superseded by this Agreement.

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     The parties are signing this Agreement as of the date stated in the
introductory clause.
SOUTHERN CONTAINER CORP.
By: /s/ Steven Grossman
Name: /s/ Steven Grossman
Title: /s/ Chief Executive Officer
/s/ James B. Porter III
JAMES B. PORTER III

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EXHIBIT “A”
ESCROW AGREEMENT
     This escrow agreement (“Agreement”) is dated as of ___, and is between
SOUTHERN CONTAINER CORP., a Delaware corporation with offices at 115 Engineers
Road, Hauppauge, New York 11788 (“Company”), JAMES B. PORTER III, residing at 4
Seashell Lane, Northport, New York 11768-1415 (“Executive”), and ___, a [New
York][limited liability partnership] (the “Escrow Agent”).
RECITAL
     Pursuant to an Amended and Restated Earnings Share Unit Agreement dated as
of February ___, 2006 (the “ESU Agreement”), Company has deposited $___with
Escrow Agent, to be held and disbursed in accordance with this Agreement.
     The parties hereto hereby agree as follows:
     1. Definitions. Capitalized terms used but not defined in this Agreement
have the meanings assigned to such terms in the ESU Agreement.
     2. Establishment of Escrow; Deposit and Investment of Escrow Fund.
          (a) Company is depositing with Escrow Agent the sum of $___in
immediately available funds (as increased by any earnings thereon, and as
reduced by any disbursements provided for herein, the “Escrow Fund”). Escrow
Agent acknowledges receipt thereof. The Escrow Fund will be held in [Escrow
Agent’s interest bearing attorney trust funds account][by Escrow Agent], until
disbursement of the entire Escrow Fund. The Escrow Fund will be kept in a
segregated account and invested [, to the extent available in connection with
the escrow agent’s attorney trust funds account,] in (with Company’s consent,
not to be unreasonably withheld) investments selected by Executive that Company
is specifically permitted to make pursuant to its lending agreements (i.e. other
than investments permitted only pursuant to a “basket clause”). If at any time
Company is not restricted in its investments, the most recent investment
restrictions that applied to Company will apply to this Section 2(a). The
maturities of such investments will be such as to permit Escrow Agent to make
prompt payment of the Escrow Fund to the party entitled thereto.
          (b) Escrow Agent hereby agrees to act as escrow agent and to hold,
safeguard and disburse the Escrow Fund pursuant to the terms and conditions
hereof.
          (c) Any interest earned on the Escrow Fund will be retained by the
Escrow Agent and be deemed part of the Escrow Fund.
     3. Disbursement of Escrow Fund.
          (a) Escrow Agent will pay to Executive to the extent available out of
the Escrow Fund the sum of $50,000 per month (the “Installment Payments”)
commencing on                    [the first day of the first month after
execution of this Escrow Agreement] and on each of first day of each month
thereafter until such time as it has disbursed the entire balance of the Escrow
Fund. Notwithstanding the foregoing, if there is an unresolved Company Release
Notice or Escrow Release Notice (each as defined below) pending on the day a
payment is due under this paragraph (a), Escrow Agent will not disburse any
portion of the Escrow Fund to Company or Executive until such Release Notice has
been resolved as provided in this Agreement.
INITIAL_____

A-1

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          (b) If Company believes that (i) Executive has terminated his
employment (other than due to his death or permanent disability) prior to the
completion of the Continuation Period or that Executive’s employment has been
terminated by the Successor during the Continuation Period for grounds that
would constitute Gross Cause under the ESU Agreement, and that it is therefore
entitled to the Escrow Fund, or (ii) it is entitled to a disbursement of the
Escrow Fund pursuant to Section 5.2 of the ESU Agreement, Company may give
notice to Escrow Agent describing such event in reasonable detail and directing
Escrow Agent to release the Escrow Fund or the excess amount of the Escrow Fund,
as the case may be, to Company (the “Company Release Notice”). Escrow Agent will
promptly notify Executive of its receipt of the Company Release Notice, which
notice will include a copy thereof. Escrow Agent will release the Escrow Fund
(or the requested portion thereof) to Company unless within 30 days after the
giving of such notice by Escrow Agent, Escrow Agent receives a notice from
Executive (which will concurrently be sent by Executive to Company) objecting to
such release (an “Executive Objection Notice”) within 30 days after the giving
of such notice by Escrow Agent, Escrow Agent shall release the Escrow Fund (or
the applicable portion thereof) to Company. Notwithstanding anything to the
contrary contained herein, a Company Release Notice may be given by fax to
Escrow Agent at (___) ___-___, attention ___.
          (c) If (x) Executive believes that (i) he has completed his services
for the Successor for the entire Continuation Period; or (ii) his employment by
the Successor has terminated prior to the completion of the entire Continuation
Period due to his permanent disability or as a result of termination by the
Successor for grounds that would not constitute Gross Cause under the ESU
Agreement and that he is therefore entitled to the Escrow Fund, or (y) Executive
dies during the Continuation Period, Executive or the representatives of his
estate (the “Representatives”), as the case may be, may give notice to Escrow
Agent describing such event in reasonable detail and directing Escrow Agent to
release the Escrow Fund to Executive or the Representatives, as the case may be
(the “Executive Release Notice”). Escrow Agent will promptly notify Company of
its receipt of the Executive Release Notice, which notice will include a copy
thereof. Escrow Agent will release the Escrow Fund to Executive or the
Representatives, as the case may be, unless within 30 days after the giving of
such notice by Escrow Agent, Escrow Agent receives a notice from Company (which
will concurrently be sent by Company to Executive or the Representatives, as the
case may be) objecting to such release (a “Company Objection Notice”).
Notwithstanding anything to the contrary contained herein, the Executive Release
Notice may be given by fax to Escrow Agent at (___) ___-___, attention ___.
          (d) If, following the giving of an Objection Notice, Executive or the
Representatives, as the case may be, and Company resolve the dispute between
them, they will jointly notify Escrow Agent of such determination (the “Joint
Notice”) and Escrow Agent will follow the directions set forth in the Joint
Notice. If Executive or the Representatives, as the case may be, and Company do
not resolve the dispute within 20 days after the giving of the Objection Notice,
the dispute will be resolved by arbitration, in Nassau County, New York, before
a panel of three arbitrators in accordance with the Commercial Rules of the
American Arbitration Association then obtaining. The determination by the
arbitrators will be binding upon the parties and will establish whether the
Objection Notice should be honored, as well as the manner in which the parties
will pay the fees and expenses of such arbitration (including the reasonable
fees of counsel to the parties). The arbitrators will promptly deliver to
Executive or the Representatives, as the case may be, Company, and Escrow Agent
an award (the “Award”) setting forth their determination.
          (e) As promptly as may be practical after either (i) the 10th day
following the giving of a Release Notice as to which no timely Objection Notice
has been given pursuant to Section 3(a) or 3(b) hereof, as the case may be, or
(ii) receipt by Escrow Agent of a Joint Notice or Award pursuant to
Section 3(d), Escrow Agent will deliver the Escrow Fund or the applicable
portion thereof in accordance with the directions set forth in said undisputed
Release Notice, Joint Notice or Award.
INITIAL_____

A-2

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     4. Duties of Escrow Agent
          (a) Escrow Agent will not be under any duty to give the Escrow Fund
any greater degree of care than it gives its own similar property; however,
Escrow Agent will be required to invest any funds held hereunder in accordance
with the terms hereof.
          (b) Escrow Agent will not be liable for actions or omissions
hereunder, including any diminution in the amount of the Escrow Fund in
connection with any investment made by Escrow Agent as provided in Section 2(a),
except for its own gross negligence or willful misconduct and, except with
respect to claims based upon such gross negligence or willful misconduct that
are successfully asserted against Escrow Agent, Executive and Company will
jointly and severally indemnify and hold harmless Escrow Agent (and any
successor Escrow Agent) from and against any and all losses, liabilities,
claims, actions, damages and expenses, including reasonable attorneys’ fees and
disbursements, arising out of or in connection with this Agreement.
          (c) Escrow Agent will be entitled to rely upon any order, judgment,
certification, demand, notice, instrument or other writing delivered to it
hereunder without being required to determine the authenticity or the
correctness of any fact stated therein or the propriety or validity of the
service thereof. Escrow Agent may act in reliance upon any instrument or
signature believed by it to be genuine and may assume that the person purporting
to give receipt or advice or make any statement or execute any document in
connection with the provisions hereof has been duly authorized to do so. Escrow
Agent may conclusively presume that the undersigned representative of any party
hereto that is an entity has full power and authority to instruct Escrow Agent
on behalf of that party unless written notice to the contrary is given to Escrow
Agent.
          (d) Escrow Agent may act pursuant to the advice of counsel with
respect to any matter relating to this Agreement and will not be liable for any
action taken or omitted by it in good faith in accordance with such advice.
          (e) Escrow Agent does not have any interest in the Escrow Fund but is
serving as escrow holder only and has only possession thereof. Any payments of
income from the Escrow Fund will be subject to withholding regulations then in
force with respect to United States taxes. The parties hereto will provide
Escrow Agent with appropriate Internal Revenue Service Forms W-9 for tax
identification number certification, or nonresident alien certifications. This
Section 4(e) and Section 4(b) will survive notwithstanding any termination of
this Agreement or the resignation of Escrow Agent.
          (f) Escrow Agent makes no representation as to the validity, value,
genuineness or collectability of any security or other document or instrument
held by or delivered to it.
          (g) Escrow Agent (and any successor Escrow Agent) may at any time
resign as such by delivering the Escrow Fund to any successor Escrow Agent
jointly designated by Executive and Company in writing, or to any court of
competent jurisdiction, whereupon Escrow Agent will be discharged of and from
any and all further obligations arising in connection with this Agreement. The
resignation of Escrow Agent will take effect on the earlier of (i) the
appointment of a successor (including a court of competent jurisdiction) or
(ii) the day that is 30 days after the date of giving notice of resignation to
Executive and Company. If, at that time, Escrow Agent has not received a
designation of a successor Escrow Agent, Escrow Agent’s sole responsibility
after that time will be to retain and safeguard the Escrow Fund until receipt of
a designation of successor Escrow Agent or a joint written disposition
instruction by Executive and Company or a final, non-appealable order of a court
of competent jurisdiction.
INITIAL_____

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          (h) Executive and Company will jointly and severally reimburse Escrow
Agent for all reasonable expenses, disbursements and advances incurred or made
by Escrow Agent in performance of its duties hereunder (including reasonable
fees, expenses and disbursements of its counsel).
          (i) No printed or other matter in any language (including, without
limitation, prospectuses, notices, reports and promotional material) that
mentions Escrow Agent’s name or the rights, powers or duties of Escrow Agent
will be issued by the other parties hereto or on such parties’ behalf unless
Escrow Agent first gives its specific written consent thereto.
          [(j) The parties acknowledge that Escrow Agent is acting as attorney
for Company. The parties agree that in the event of a dispute involving the ESU
Agreement or this Agreement, Escrow Agent may continue to serve as the attorney
for Company in connection with said dispute.]
     5. Limited Responsibility. This Agreement expressly sets forth all the
duties of Escrow Agent with respect to any and all matters pertinent hereto. No
implied duties or obligations will be read into this Agreement against Escrow
Agent. Escrow Agent will not be bound by the provisions of any agreement among
the other parties hereto except this Agreement.
     6. Tax Matters.
          (a) The parties agree that, for purposes of federal and other taxes
based on income, Executive will be treated as the owner of the Escrow Fund and
that Executive will report all income, if any, that is earned on, or derived
from, the Escrow Fund as its income in the taxable year or years in which such
income is properly includible and pay any taxes attributable thereto.
          (b) Executive acknowledges that if he terminates his employment (other
than due to his death or permanent disability) prior to the completion of the
Continuation Period or his employment is terminated by the Successor during the
Continuation Period for grounds that would constitute Gross Cause under the ESU
Agreement, then Company would have withheld and paid over on Executive’s behalf
taxes on sums that Executive was not entitled to pursuant to this Agreement. As
a result, Executive would be entitled to a refund of such taxes. Accordingly,
Executive agrees that (i) in such event, he will amend his income tax returns so
as to seek a refund of any income taxes paid by him or on his behalf with
respect to any income that he did not ultimately receive hereunder; and (ii) he
will pay any such refund to Company within 15 days after receiving the same from
the applicable taxing authorities.
     7. Amendments and Waivers; Delay Not a Waiver; Remedies. This Agreement may
be amended or modified only by an instrument in writing signed by Executive,
Company and Escrow Agent, and any provision of this Agreement may be waived by
Executive, Company and Escrow Agent. No waiver by any party hereto will be
effective unless it is in writing and is signed by such party. No failure on the
part of any party hereto to exercise, and no delay in exercising, any right
hereunder will operate as a waiver thereof or preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
     8. Binding Effect. This Agreement will be binding upon, and will inure to
the benefit of, the parties hereto and their respective heirs, distributees,
legal representatives, successors and assigns, except that Executive may not
transfer his rights or obligations hereunder.
     9. Notices. All notices given hereunder must be in writing and sent by
certified mail, return receipt requested, or by nationally recognized overnight
courier, addressed to the respective party at its or his address set forth
above, or at such other address or to such designee as such party designates by
a notice given
INITIAL_____

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in the manner herein provided. Each such notice will be deemed given on the date
it is delivered or its delivery is refused if given in accordance with this
Article 9 and upon confirmed receipt if given by fax as provided in Section 3(b)
and 3(c).
     10. Headings. The headings and captions hereunder are for convenience only
and will not affect the interpretation or construction of this Agreement.
     11. Severability. The provisions of this Agreement are intended to be
severable. If any provision of this Agreement is held invalid or unenforceable
in whole or in part in any jurisdiction, such provision will, as to such
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without in any manner affecting the validity or enforceability
thereof in any other jurisdiction or the remaining provisions hereof in any
jurisdiction.
     12. Counterparts. To facilitate execution, this Agreement may be executed
in as many counterparts as may be convenient or required. It will not be
necessary that the signature of, or on behalf of, each party, or that the
signature of all persons required to bind any party, appear on each counterpart.
All counterparts will collectively constitute a single document. It will not be
necessary in making proof of this Agreement to produce or account for more than
a single counterpart containing the respective signatures of, or on behalf of,
each of the parties hereto. Any signature page to any counterpart may be
detached from such counterpart without impairing the legal effect of the
signatures thereon and thereafter attached to another counterpart.
     13. Facsimile and Photocopy. Any facsimile or photocopy signature on any
notice, document or other certificate delivered pursuant to this Agreement will
be deemed to have the same force and effect as an original signature, and to the
fullest extent permitted by law may be used in lieu of an original signature to
evidence the execution and delivery of the document, certificate or instrument
to which such facsimile or photocopy signature is attached.
     14. Integration. This Agreement set forth the entire agreement among the
parties hereto relating to the subject matter hereof and supersedes any prior
oral or written statements or agreements with respect to such subject matter.
     15. Governing Law. This Agreement (and any claims or controversies arising
out of or relating to this Agreement) will be governed by the law of the State
of New York.
INITIAL_____

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     The parties are signing this Agreement as of the date stated in the
introductory clause.

              SOUTHERN CONTAINER CORP.
 
       
 
  By:    
 
       
 
  Name:    
 
       
 
  Title:    
 
       
 
                  JAMES B. PORTER III
 
            [ESCROW AGENT]  
 
  By:    
 
       
 
  Name:    
 
       
 
  Title:    
 
       

INITIAL_____

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EXHIBIT “B”
By way of example only:

                                      Total                     Units          
Executive’s   Accumulated Date   Granted   Net Income   Earnings Base   Earnings
Share*
1/1/02
    10,000     $ 45,121,000     $ 360,968     $ 784,700  
1/1/03
    10,000     $ 33,592,000     $ 335,920     $ 1,120,620  
1/1/04
    10,000     $ 34,925,000     $ 349,250     $ 1,469,870  
1/1/05
    10,000     $ 40,628,000     $ 406,280     $ 1,876,150  
1/1/06
    10,000     $ 30,465,000     $ 304,650     $ 2,180,800  

 

         
Date
  =   date of Termination Event
Net Income
  =   Net Income for the year preceding the year in which the Termination Event
occurred
Earnings Base
  =   (Net Income/1,000,000) x Units Granted

* — including Solvay Accumulated Earnings Share
Figures in italics are estimates.
Unless Section 3.2 or 5.1(c) is applicable, if Executive’s employment is
terminated on any of the dates set forth above, he would be entitled to receive
the amount set forth under “Accumulated Earnings Share” above applicable to the
date of termination.
INITIAL_____

B-1