Exhibit 10.33
SEPARATION AGREEMENT AND RELEASE
     This Separation Agreement and Release (this “Agreement”) is entered into as
of January 9, 2008, by and among Andy J. Brewer (the “Executive”) and Pregis
Holding I Corporation, a Delaware corporation (“Pregis I”), and its wholly owned
subsidiaries Pregis Holding II Corporation, a Delaware corporation (“Pregis
II”), and Pregis Corporation, a Delaware corporation (“Pregis III”) (Pregis I,
Pregis II and Pregis III, collectively the “Companies”) (each of the Executive
and the Companies, a “Party” and, collectively, the “Parties”). The Parties
acknowledge that the terms and conditions of this Agreement have been
voluntarily agreed to and are intended to be final and binding.
RECITALS
     WHEREAS, the Parties have previously entered into an Employment Agreement,
dated as of October 12, 2005 (the “Employment Agreement”);
     WHEREAS, the Executive and the Companies are parties to a Noncompetition
Agreement, dated as of October 12, 2005 (the “Noncompetition Agreement”);
     WHEREAS, on October 12, 2005, April 7, 2006 and February 27, 2007, Pregis I
granted to the Executive options (the “Options”) to purchase an aggregate of
173.33 shares of common stock, par value $0.01 per share, of Pregis I (the
“Common Stock”) pursuant to and in accordance with the terms of Nonqualified
Stock Option Agreements between the Executive and Pregis I entered into on such
dates (the “Option Agreements”);
     WHEREAS, pursuant to and in accordance with the terms of the Subscription
Agreement between Pregis I and the Executive, the Executive purchased twenty
(20) shares of Common Stock (the “Subscription Agreement”);
     WHEREAS, the Executive separated from employment in all capacities with the
Companies on November 19, 2007 (the “Separation Date”); and
     WHEREAS, as a condition precedent and a material inducement for the
Companies to provide to the Executive the Separation Benefits (as defined in
Section 1 hereof) and for Pregis I to agree to the provisions of Section 3
hereof, the Executive has agreed to execute this Agreement and be bound by the
provisions herein.
     NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, and for the monetary and other consideration set forth below,
the receipt and sufficiency of which are hereby acknowledged, the Parties agree
as follows:
     1. Separation from Employment. The Executive and Companies agree that on
the Separation Date, the Executive resigned from any position or office with or
in the Companies or their subsidiaries or affiliates, which resignations have
been accepted as of the Separation Date by the Companies or their respective
subsidiaries or affiliates. The Executive and Companies understand and agree
that from and after the Separation Date the Executive was no longer authorized
to incur any expenses, obligations or liabilities on behalf of the Companies or
any of

 

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their subsidiaries or affiliates. In consideration for acceptance of the terms
contained in this Agreement, the Companies shall (a) pay the Executive his Base
Compensation, set at $300,000 as of the Separation Date, for the period
commencing on the Separation Date through March 19, 2008, at such times and in
such amounts as would have been paid in accordance with the Companies’ normal
payroll procedures had the Executive’s employment continued after the Separation
Date through March 19, 2008; (b) pay the Executive a prorated amount in respect
of the Executive’s 2007 Incentive Bonus (as defined in the Employment Agreement)
based on the actual performance of the Companies through December 31, 2007 and
the number of days in 2007 through the Separation Date, which the Companies
currently expect will be approximately $116,000 (the “2007 Bonus”), payable in
equal monthly installments over a twelve-month period beginning with the first
payroll period ending after April 1, 2008; and (c) continue to provide the
Executive with the same medical and dental benefits provided immediately prior
to the Separation Date until March 19, 2008 (the payments and benefits described
in clauses (a), (b) and (c) hereof, the “Separation Benefits”); provided,
however, that the Companies’ obligation to provide the Separation Benefits shall
be conditioned upon (x) the Executive’s continued compliance with his
obligations under the Noncompetition Agreement (as amended hereby) and (y) the
Executive’s continued compliance with his obligations under this Agreement,
subject to the provisions of Paragraph 1(c) of the Noncompetition Agreement.
     2. Noncompetition Agreement.
          (a) The Parties hereby agree that Section 1(a) of the Noncompetition
Agreement is amended as follows: the restrictions described in clause (iii) of
Section 1(a) of the Noncompetition Agreement shall continue until the second
anniversary of the Separation Date. The restrictions set forth in
Sections 1(a)(i), (ii) and (iv) of the Noncompetition Agreement shall continue
until November 19, 2008.
          (b) The Noncompetition Agreement shall otherwise remain unchanged and
in full force and effect.
     3. Repurchase of Common Stock.
          (a) Pregis I and the Executive agree that Pregis I is hereby
purchasing from the Executive for cash twenty (20) shares of Common Stock for an
aggregate purchase price of $400,000, representing full and adequate
consideration for such shares (the “Repurchase Payment”), payable as follows:
               (i) 50% of the Repurchase Payment shall be paid within thirty
(30) days from the date that the Executive submits the share certificate(s)
representing the twenty (20) shares of Common Stock to the Company; and
               (ii) 50% of the Repurchase Payment shall be paid within thirty
(30) days following the second anniversary of the Separation Date; provided,
however, that the payment described in this clause (ii) is conditioned on
(x) the Executive’s continued compliance with his obligations under the
Noncompetition Agreement (as amended hereby) and (y) the Executive’s continued
compliance with his obligations under this Agreement, subject to the provisions
of Paragraph 1(c) of the Noncompetition Agreement.

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          (b) In the event of any conflict between or among the provisions of
this Agreement and the Subscription Agreement, such conflict shall be resolved
in each and every instance in favor of the provisions of this Agreement.
     4. Options. Pregis I and the Executive agree that all of the Options
granted to the Executive pursuant to the Option Agreements are hereby canceled
in their entirety. In the event of any conflict between or among the provisions
of this Agreement and the Option Agreements, such conflict shall be resolved in
each and every instance in favor of the provisions of this Agreement.
     5. Release of Claims by the Executive.
          (a) In consideration of the Companies entering into this Agreement,
the sufficiency of which the Executive acknowledges, the Executive, with the
intention of binding himself and his heirs, executors, administrators and
assigns, does hereby release, remise, acquit and forever discharge the Companies
and their subsidiaries and affiliates (the “Company Affiliated Group”), their
present and former officers, directors, executives, shareholders, agents,
attorneys, employees and employee benefit plans (and the fiduciaries thereof)
and the successors, predecessors and assigns of each of the foregoing
(collectively, the “Company Released Parties”) of and from any and all claims,
actions, causes of action, complaints, charges, demands, rights, damages, debts,
sums of money, accounts, financial obligations, suits, expenses, attorneys’ fees
and liabilities of whatever kind or nature in law, equity or otherwise, whether
accrued, absolute, contingent, unliquidated or otherwise and whether now known
or unknown, suspected or unsuspected, which the Executive, individually or as a
member of a class, now has, owns or holds, or has at any time heretofore had,
owned or held, arising on or prior to the date hereof, against any Company
Released Party in any capacity, including, without limitation, any and all
claims (i) in respect of the shares of Common Stock repurchased by Pregis I
pursuant to Section 3 hereof, (ii) in respect of the Options canceled pursuant
to Section 4 hereof, (iii) arising out of or in any way connected with the
Executive’s service to any member of the Company Affiliated Group (or the
predecessors thereof) in any capacity, or the termination of such service in any
such capacity, (iv) for severance or vacation benefits, unpaid wages, salary or
incentive payments, (v) for breach of contract, wrongful discharge, impairment
of economic opportunity, defamation, intentional infliction of emotional harm or
other tort, (vi) for any violation of applicable state and local labor and
employment laws (including, without limitation, all laws concerning unlawful and
unfair labor and employment practices) and (vii) for employment discrimination
under any applicable federal, state or local statute, provision, order or
regulation, and including, without limitation, any claim under Title VII of the
Civil Rights Act of 1964 (“Title VII”), the Civil Rights Act of 1988, the Fair
Labor Standards Act, the Americans with Disabilities Act (the “ADA”), the
Employee Retirement Income Security Act of 1974, as amended (“ERISA”), the Age
Discrimination in Employment Act (the “ADEA”) and any similar or analogous state
statute (including the Illinois Human Rights Act), excepting only:
               (i) rights of the Executive under this Agreement;
               (ii) the right of the Executive to receive COBRA continuation
coverage in accordance with applicable law;

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               (iii) claims for accrued and unpaid benefits under any health,
disability, retirement or other similar employee benefit plan (within the
meaning of Section 3(3) of ERISA) of the Company Affiliated Group; and
               (iv) rights to indemnification the Executive has under the
by-laws or certificate of incorporation of any member of the Company Affiliated
Group or otherwise through or from the Companies, including under any policy of
insurance providing indemnification or coverage.
          (b) The Executive acknowledges and agrees that the release of claims
set forth in this Section 5 is not to be construed in any way as an admission of
any liability whatsoever by any Company Released Party, any such liability being
expressly denied.
          (c) The release of claims set forth in this Section 5 applies to any
relief no matter how called, including, without limitation, wages, back pay,
front pay, compensatory damages, liquidated damages, punitive damages, damages
for pain or suffering, costs and attorneys’ fees and expenses, but shall
expressly exclude claims based on this Agreement.
          (d) The Executive specifically acknowledges that his acceptance of the
terms of the release of claims set forth in this Section 5 is, among other
things, a specific waiver of his rights, claims and causes of action under Title
VII, the ADEA, the ADA and any state or local law or regulation in respect of
discrimination of any kind; provided, however, that nothing herein shall be
deemed, nor does anything contained herein purport, to be a waiver of any right
or claim or cause of action which by law the Executive is not permitted to
waive.
          (e) As to rights, claims and causes of action arising under the ADEA,
the Executive acknowledges that he has been given but not utilized a period of
twenty-one (21) days to consider whether to execute this Agreement. If the
Executive accepts the terms hereof and executes this Agreement, he may
thereafter, for a period of seven (7) days following (and not including) the
date of execution, revoke this Agreement as it relates to the release of claims
arising under the ADEA. If no such revocation occurs, this Agreement shall
become irrevocable in its entirety, and binding and enforceable against the
Executive, on the day next following the day on which the foregoing seven-day
period has elapsed. If such a revocation occurs, this Agreement shall be of no
force or effect.
          (f) The Executive acknowledges and agrees that he has not, with
respect to any transaction or state of facts existing prior to the date hereof,
filed any complaints, charges or lawsuits against any Company Released Party
with any governmental agency, court or tribunal.
          (g) The Executive acknowledges that he has been advised to seek, and
has had the opportunity to seek, the advice and assistance of an attorney with
regard to the release of claims set forth in this Section 5 and has been given a
sufficient period within which to consider the release of claims set forth in
this Section 5.
          (h) The Executive acknowledges that the release of claims set forth in
this Section 5 relates only to claims which exist as of the date of this
Agreement.

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          (i) The Executive acknowledges that the Separation Benefits he is
receiving in connection with the release of claims set forth in this Section 5
are in addition to anything of value to which the Executive is entitled from the
Companies and their affiliates.
          (j) The directors and officers of the Companies acknowledge that, as
of the date of this Agreement, they are not aware of any actual or threatened
claim or cause of action arising from or in any respect relating to the
Employment Agreement or the Executive’s employment by the Companies, or the
conclusion thereof. The Companies acknowledge that on the date of this Agreement
they are not aware of any actual or threatened claim or course of action from or
in any respect relating to the Executive’s actions prior to the Separation Date.
Nothing contained in this Section 5(j) shall be deemed to constitute a waiver of
any legal rights of the Company Released Parties.
     6. Non-disparagement. From and after the Separation Date, the Executive
shall not make or publish any disparaging statements (whether written or oral)
regarding any member of the Company Affiliated Group or the affiliates,
directors, officers or executives of any of them.
     7. Acknowledgement. The Companies acknowledge and agree that the
Executive’s employment was not terminated for Cause (as defined in the
Employment Agreement) and that, from and after the Separation Date, the
Companies shall not make any statement or take any position that the Executive
was terminated for Cause.
     8. 409A. The Companies hereby represent to the Executive that the
Separation Benefits and the Repurchase Payment will not subject the Executive to
the tax imposed under Section 409A of the Internal Revenue Code of 1986, as
amended, and the regulations and guidance issued thereunder, and the Companies
agree to indemnify the Executive in connection therewith. The Company will
defend, hold harmless and indemnify the Executive on a fully grossed-up after
tax basis from and against any and all claims, losses, liabilities, obligations,
damages, interest, penalties, impositions, assessments, demands, judgments,
settlements, costs and expenses (including reasonable attorneys’, accountants’
and experts’ fees and expenses) (collectively, “Damages”) with respect to any
tax liability of the Executive resulting from any damages that would be imposed
under Section 409A, and will promptly, but in no event later than five business
days after receipt of any reasonable notice from the Executive to the Company of
any claim for damages, pay to the Executive in cash the amount of damages set
forth in such notice.
     9. Good Reference. No officer or director of the Company will make any
disparaging statements about Executive. The Company shall provide a telephonic
reference in accordance with the attached Exhibit A.
     10. Return of Company Property. The Executive shall return to the Companies
any and all documents, files, credit cards and other property of any kind
belonging to the Companies not later than the date hereof.
     11. Notices. Any notice required or desired to be delivered hereunder shall
be in writing and shall be delivered personally, by courier service, or by
certified mail, return receipt requested, and shall be effective when actually
delivered to the Party to whom such notice shall

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be directed and shall be addressed as follows (or to such other address as the
Party entitled to notice shall hereafter designate in accordance with the terms
hereof):

         
 
  If to the Companies:   With a copy to:
 
       
 
  c/o AEA Investors LLC   Fried, Frank, Harris, Shriver & Jacobson LLP
 
  Park Avenue Tower   One New York Plaza
 
  65 East 55th Street   New York, NY 10004
 
  New York, NY 10022   Attn: Howard Adler, Esq.
 
  Attn: Sanford Krieger    
 
       
 
  If to the Executive:   With a copy to:
 
       
 
  Andy J. Brewer   Bellows and Bellows, P.C.
 
  1405 Scott Avenue   209 S. LaSalle Street, Suite 800
 
  Winnetka, IL 60093   Chicago, Illinois 60604
 
      Attn: Laurel Bellows

     12. Withholding. Notwithstanding anything in this agreement to the
contrary, the Companies shall have the right to deduct from any amount payable
under this Agreement any taxes or other amounts required by applicable law to be
withheld.
     13. Complete Agreement. This Agreement and the Noncompetition Agreement (as
modified hereby) constitute the complete agreement of the Parties with respect
to the subject matter hereof and shall supersede all agreements between the
Parties to the extent they relate in any way to the employment, termination of
employment, compensation and executive benefits of the Executive.
     14. Severability. Each provision hereof and portion thereof is severable,
and if one or more provisions hereof or portions thereof are declared invalid,
the remaining provisions and portions thereof shall nevertheless remain in full
force and effect. If any provision of this Agreement or portion thereof is so
broad, in scope or duration or otherwise, as to be unenforceable, such provision
shall be interpreted to be only so broad as is enforceable.
     15. No Waiver. The failure to enforce at any time any of the provisions of
this Agreement or to require at any time performance by another party of any of
the provisions hereof shall in no way be construed to be a waiver of such
provisions or to affect the validity of this Agreement, or any part hereof, or
the right of any Party thereafter to enforce each and every such provision in
accordance with the terms of this Agreement.
     16. Counterparts. This Agreement may be executed in several counterparts,
each of which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument. The Parties represent that each
signatory to this Agreement on his, its or their behalf is authorized to make
the promises and commitments herein.

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     17. Successors. This Agreement shall be binding upon any and all successors
and assigns of the Executive and the Companies, including their present, former
and future parents, subsidiaries, affiliates, divisions, predecessors,
successors and assigns and their respective present, former and future officers,
directors, shareholder, partners, joint venturers, insurers, benefit plans, plan
fiduciaries and plan administrators, employees, agents and representatives.. The
Company will require any successor to, or purchaser or acquirer of (in each
case, whether direct or indirect, by purchase, merger, consolidation,
reorganization or otherwise), all or substantially all of the business and/or
assets of the Company to assume expressly and agree to perform this Agreement in
the same manner and to the same extent that the Company would be required to
perform it if no such succession, purchase or acquisition had taken place.
     18. Third-Party Beneficiary. Each of the Company Released Parties shall be
a third-party beneficiary with respect to Section 5 and shall be entitled to
enforce the provisions thereof.
     19. Governing Law. Except for issues or matters as to which federal law is
applicable, this Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of New York without giving effect to the
conflicts of law principles thereof.
     20. Headings. The captions and headings contained in this Agreement are for
convenience only and shall not be construed as a part of the Agreement.

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     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
and year first above written.

            COMPANIES:

PREGIS HOLDING I CORPORATION
      By:   /s/ D. Keith LaVanway         Name:   D. Keith LaVanway       
Title:   CFO        PREGIS HOLDING II CORPORATION
      By:   /s/ D. Keith LaVanway         Name:   D. Keith LaVanway       
Title:   CFO        PREGIS CORPORATION
      By:   /s/ D. Keith LaVanway         Name:   D. Keith LaVanway       
Title:   CFO        EXECUTIVE:
      /s/ Andy J. Brewer       Andy J. Brewer