EMPLOYMENT AGREEMENT

BETWEEN

MYERS INDUSTRIES, INC.

AAND

KEVIN C. O'NEIL

 

 

 

 

Effective Date: August 21, 2005

Table of
Contents                                                             Page

DEFINITIONS                                                                   *

AMENDMENT AND RESTATEMENT OF PRIOR AGREEMENT          4

EMPLOYMENT TERM                                                         5

POSITION, DUTIES, AND RESPONSIBILITIES                             *

SALARY, BONUS AND BENEFITS                                          *

TERMINATION OF EMPLOYMENT                                         *

SEVERANCE COMPENSATION                                             *

CHANGE OF CONTROL                                                      *

SEVERANCE PLAN                                                          15

PLAN AMENDMENTS                                                       *

CONFIDENTIAL INFORMATION                                           16

ARBITRATION                                                                *

NOTICES                                                                       *

ASSIGNMENT; BINDING EFFECT                                          *

INVALID PROVISIONS                                                       *

ALTERNATIVE SATISFACTION OF COMPANY'S OBLIGATIONS      *

ENTIRE AGREEMENT, MODIFICATION                                   *

NON-EXCLUSIVITY OF RIGHTS                                            *

WAIVER OF BREACH                                                         *

GOVERNING LAW                                                            *

TAX WITHHOLDING                                                         *

EXPENSES OF ENFORCEMENT                                             *

REPRESENTATION                                                           *

SUBSIDIARIES AND AFFILIATES                                          *

NO MITIGATION OR OFFSET                                               *

SOLE REMEDY                                                                *

 

EMPLOYMENT AGREEMENT

   

        THIS EMPLOYMENT AGREEMENT is entered into as of the 21st day of August,
2005, by and between MYERS INDUSTRIES, INC., an Ohio corporation (the
"Company"), and KEVIN C. O'NEIL (the "Executive").

W I T N E S S E T H:

        WHEREAS, the Company and the Executive (collectively "the Parties")
desire to enter into this Employment Agreement (the "Agreement") as hereinafter
set forth;

        NOW, THEREFORE, the Company and the Executive agree as follows:

        1.     DEFINITIONS. For purposes of this Agreement, the following terms
shall have the meanings set forth in this Section 1 when used in this Agreement.
Certain other terms are defined in the body of this Agreement.

             (a) Agreement.     The term "Agreement" shall mean this Employment
Agreement, as it may be amended from time to time.

             (b)  Annual Bonus.     The term "Annual Bonus" shall mean the bonus
paid to executives or other employees of the Company pursuant to a formal or
informal bonus plan or individual annual bonus arrangement.

             (c) Base Salary.     The term "Base Salary" shall mean the salary
provided for in Section 5 or any increased salary granted to the Executive in
accordance with Section 5.

             (d)  Board.     The term "Board" shall mean the Board of Directors
of the Company.

             (e) Cause.     The term "Cause" shall mean:

                        (i)      Commission by the Executive (evidenced by a
conviction or written, voluntary and freely given confession) of a criminal act
constituting a felony involving fraud or moral turpitude;

                        (ii)      Commission by the Executive of a material
breach or material default of any of the Executive's agreements or obligations
under any provision of this Agreement, including, without limitation, the
Executive's agreements and obligations under Subsections 4(a) through 4(e),
Section 11 or Section 12 of this Agreement, which is not substantially cured in
all material respects within thirty (30) days after the Board gives written
notice thereof to the Executive; or

                        (iii)      Commission by the Executive, when carrying
out the Executive's duties under this Agreement, of acts or the omission of any
act, which both (A) constitutes gross negligence or willful misconduct and (B)
results in material economic harm to the Company or has a materially adverse
effect on the Company's operations, properties or business relationships.

             (f) Change in Control.     The term "Change in Control" shall mean
a change in control of the Company of a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A of Regulation 14A promulgated
under the Securities Exchange Act of 1934, as amended, as in effect on the date
of this Agreement (the "Exchange Act"), whether or not the Company is then
subject to such reporting requirement; provided that, without limitation, a
Change in Control shall be deemed to have occurred if:

                       

(i)      Any "person" (as defined in Sections 13(d) and 14(d) of the Exchange
Act), other than Stephen E. Myers or Mary Myers, becomes the "beneficial owner"
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing twenty percent (20%) or more of the
combined voting power of the Company's then outstanding securities; provided
that a Change in Control shall not be deemed to occur under this clause (i) by
reason of the acquisition of securities by the Company or an employee benefit
plan (or any trust funding such a plan) maintained by the Company;

                       

(ii)      During any period of one (1) year there shall cease to be a majority
of the Board comprised of "Continuing Directors" as hereinafter defined; or

                       

(iii)      There occurs (A) a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would result in
the voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) more than eighty percent (80%)
of the combined voting power of the voting securities of the Company or such
surviving entity outstanding immediately after such merger or consolidation, or
(B) the approval by the stockholders of the Company of a plan of complete
liquidation of the Company, or (C) the sale or disposition by the Company of
more than fifty percent (50%) of the Company's assets. For purposes of this
Subsection 1(f)(iii), a sale of more than fifty percent (50%) of the Company's
assets includes a sale of more than fifty percent (50%) of the aggregate value
of the assets of the Company and its subsidiaries or the sale of stock of one or
more of the Company's subsidiaries with an aggregate value in excess of fifty
percent (50%) of the aggregate value of the Company and its subsidiaries or any
combination of methods by which more than fifty percent (50%) of the aggregate
value of the Company and its subsidiaries is sold.

                       

(iv)      For purposes of this Agreement, a "Change of Control" will be deemed
to occur:

             (A)     on the day on which a twenty percent (20%) or greater
ownership interest described in Subsection 1(f)(i) is acquired, provided that a
subsequent increase in such ownership interest after it first equals or exceeds
twenty percent (20%) shall not be deemed a separate Change of Control;

             (B)     on the day on which "Continuing Directors," as hereinafter
defined, cease to be a majority of the Board as described in
Subsection 1(f)(ii);

             (C)     on the day of a merger, consolidation or sale of assets as
described in Subsection 1(f)(iii); or

             (D)     on the day of the approval of a plan of complete
liquidation as described in Subsection 1(f)(iii).

                        (v)      For purposes of this Subsection 1(f), the words
"Continuing Directors" mean individuals who at the beginning of any period (not
including any period prior to the date of this Agreement) of one (1) year
constitute the Board and any new Director(s) whose election by the Board or
nomination for election by the Company's stockholders was approved by a vote of
at least a majority of the Directors then still in office who either were
Directors at the beginning of the period or whose election or nomination for
election was previously so approved.

             (g)      Company. The term "Company" shall mean Myers Industries,
Inc., an Ohio corporation, and its successors and assigns to the extent
permitted under this Agreement.

             (h)      Compensation Committee. The term "Compensation Committee"
shall mean the Compensation Committee of the Board or its successor.

             (i)     Director. The term "Director" shall mean a member of the
Board.

             (j)      Disability. The term "Disability" shall mean a physical or
mental incapacity that prevents the Executive from performing his duties
hereunder for a period of one hundred eighty (180) consecutive days in any
period of two consecutive fiscal years of the Company.

             (k)     Effective Date. The term "Effective Date" shall mean the
effective date of this Agreement, which shall be August 21, 2005.

             (l)     Employment Term. The term "Employment Term" shall have the
meaning set forth in Subsection 3(b) of this Agreement.

             (m)     Good Reason. The term "Good Reason" shall mean the
occurrence of (i) any reduction in the annual base salary of the Executive of
less than Two Hundred and Sixty-Five Thousand Dollars ($265,000) per year, (ii)
any reduction in the position, authority or office of the Executive, (iii) any
material reduction in the Executive's responsibilities or duties for the
Company, (iv) any material adverse change or reduction in the aggregate "Minimum
Benefits," as hereinafter defined, provided to the Executive as of the Effective
Date (provided that any material reduction in such aggregate Minimum Benefits
that is required by law or applies generally to all employees of the Company
shall not constitute "Good Reason" as defined hereunder), (v) any change in the
Executive's reporting relationship, (vi) any relocation of the Executive's
principal place of work with the Company to a place more than twenty-five (25)
miles from the geographical center of Akron, Ohio, or (vii) the material breach
or material default by the Company of any of its agreements or obligations under
any provision of this Agreement. As used in this Subsection 1(m), an "adverse
change or material reduction" in the aggregate Minimum Benefits shall be deemed
to result from any reduction or any series of reductions which, in the
aggregate, exceeds five percent (5%) of the value of such aggregate Minimum
Benefits determined as of the Effective Date. As used in this Subsection 1(m),
Minimum Benefits are life insurance, accidental death, long term disability,
short term disability, medical, dental, and vision benefits and the Company's
expense reimbursement policy. The Executive shall give written notice to the
Company on or before the date of termination of employment for Good Reason
stating that the Executive is terminating employment with the Company and
specifying in detail the reasons for such termination. If the Company does not
object to such notice by notifying the Executive in writing within five (5) days
following the date of the Company's receipt of the Executive's notice of
termination, the Company shall be deemed to have agreed that such termination
was for Good Reason. The parties agree that "Good Reason" will not be deemed to
have occurred merely because the Company becomes a subsidiary or division of
another entity following a "Change in Control," as defined herein, provided the
Executive continues to serve as the Vice President and General Counsel of the
new parent company and its subsidiaries. The parties further agree that "Good
Reason" will be deemed to have occurred if the purchaser, in a Change in Control
transaction, does not assume this Agreement in accordance with Section 15
hereof.

             (n)     Parties. The term "Parties" shall mean the Company and the
Executive.

             (o)     Retirement. The term "Retirement" shall have the definition
ascribed to such term in the Company's Executive Supplemental Retirement Plan as
in effect on the Effective Date.

             (p)     Severance Benefit Plan. The term "Severance Benefit Plan"
shall mean any plan, policy or arrangement providing severance benefits for
executive officers (and any other employees) of the Company.

        2.     PRIOR AGREEMENT. This Agreement shall not supercede and shall
have no effect on that certain Indemnification Agreement between the Parties
dated as of May 3, 1999 which agreement shall remain in effect until they shall
expire in accordance with its and their terms.

        3.     EMPLOYMENT TERM.

             (a)     During the Employment Term, the Company shall employ the
Executive, and the Executive shall serve the Company, as its Vice President,
General Counsel and Secretary, which at the time of this Agreement is Vice
President, General Counsel and Secretary, based on the terms and subject to the
conditions set forth herein.

             (b)     The Employment Term shall commence on the Effective Date
and shall continue indefinitely, provided that the Employment Term may terminate
as provided in Section 6 hereof.

        4.     POSITION, DUTIES, AND RESPONSIBILITIES. At all times during the
Employment Term, the Executive shall:

             (a)     Hold the position of the Company's Vice President, General
Counsel and Secretary, an executive officer, reporting to the Chief Executive
Officer and the Board, as applicable;

             (b)     Have those duties and responsibilities, and the authority,
customarily possessed by a Vice President, General Counsel and Secretary of a
major corporation and such additional duties as may be assigned to the Executive
from time to time by the Chief Executive Officer or Board, as applicable, which
are consistent with the position of Vice President, General Counsel and
Secretary of a major corporation;

             (c)     [Reserved]

             (d)     Adhere to such reasonable written policies and such
reasonable unwritten policies and directives as are of common knowledge to
executive officers of the Company, as may be promulgated from time to time by
the Board and which are applicable to executive officers of the Company; and

             (e)     Devote the Executive's entire business time, energy, and
talent (subject to vacation time in accordance with the Company's policy
applicable to executive officers, illness or injury) to the business, and to the
furtherance of the purposes and objectives, of the Company, and neither directly
nor indirectly act as an executive of or render any business, commercial, or
professional services to any other person, firm or organization for
compensation, without the prior written approval of the Board.

Nothing in this Agreement shall preclude the Executive from devoting reasonable
periods of time to charitable and community activities or the management of the
Executive's investment assets, provided such activities do not unreasonably
interfere with the performance by the Executive of the Executive's duties
hereunder. Furthermore, service by the Executive on the boards of directors of
up to two (2) noncompeting companies (in addition to affiliates of the Company)
shall not be deemed to be a violation of this Agreement, provided such service
does not unreasonably interfere with the performance of the Executive's duties
hereunder.

        5.     SALARY, BONUS AND BENEFITS. For services rendered by the
Executive on behalf of the Company during the Employment Term, the following
salary, bonus and benefits shall be provided to the Executive by the Company:

             (a)     The Company shall pay to the Executive, in equal
installments, according to the Company's then current practice for paying its
executive officers in effect from time to time during the Employment Term, an
annual Base Salary at the initial rate of Two Hundred Sixty-Five Thousand
Dollars ($265,000.00). This salary may be increased, but not decreased, to the
extent, if any, that the Compensation Committee may determine.

             (b)     At the discretion of the Compensation Committee, the
Executive shall receive an Annual Bonus. Such Annual Bonus shall be paid at such
time as Annual Bonuses are paid to executive officers of the Company as
determined by the Compensation Committee. If any portion of an Annual Bonus
shall be payable in a year after the year in which it is earned, and in the
event the Executive's employment is terminated prior to payment of the full
Annual Bonus amount to which he is entitled for any prior year, any remaining
payments shall be made within thirty (30) days of his termination date.

             (c)     The Executive shall be eligible for participation in such
other benefit plans, including, but not limited to, the Company's profit sharing
plan, Executive Supplemental Retirement Plan, short-term and long term
disability plans, group term life insurance plan, medical plan or PPO, dental
plan, and the 1999 Incentive Stock Plan, as the Company may adopt from time to
time and in which the Company's executive officers, or employees in general, are
eligible to participate. This Subsection 5(c) shall not be deemed to prevent
participation in any special plan or arrangement providing special benefits to
the Executive which are not available to other employees. Such participation
shall be subject to the terms and conditions set forth in the applicable plan
documents. As is more fully set forth in Section 9 hereof, the Executive shall
not be entitled to duplicative payments under this Agreement and any Severance
Benefit Plan.

             (d)     Without limiting the generality of Subsection 5(c) above,
with respect to life insurance, the Executive shall:

(i)     be entitled to participate in the Company's group term life insurance
plan with a death benefit to be provided at a level of not less than one (1)
times annual Base Salary at the Company's expense.

(ii)     [Reserved]

             (e)     Without limiting the generality of Subsection 5(c) above,
the Executive shall be entitled to an automobile of the Executive's choice but
subject to the approval of the Chief Executive Officer, and reimbursement for
all expenses in connection therewith, including, but not limited to, the cost of
acquisition, maintenance, fuel and liability insurance.

             (f)     The Executive shall be entitled to take, during each
one-year period commencing with January 1, 2005, during the Employment Term,
vacation time equal to not fewer than four (4) weeks.

             (g)     [Reserved]

             (h)     [Reserved]

             (i)     [Reserved]

             (j)     The Company shall pay the reasonable legal fees incurred by
the Executive in connection with negotiation of this Agreement and the
maintenance, review and renegotiation thereof.[Reserved]

             (k)     Notwithstanding any contrary provision of this Agreement,
the Executive will at all times be entitled to benefits which are at least as
favorable to the Executive and his family as are generally provided to all
executives of the Company or the family thereof, with the exception of Mary
Myers and Stephen E. Myers.

             (l)     [Reserved]
.

             (m)     At the customary time for granting stock options under the
Company's 1999 Incentive Stock Plan or its successor, the Executive will be
granted the option to purchase an amount of the Company's common stock
commensurate and in recognition of his position as the Vice President, General
Counsel and Secretary of the Company, with terms and provisions similar to those
in effect under such plan as of the Effective Date, or the Company will granted
another award acceptable to the Executive.

             (n)     The Executive shall receive years of service credit on a
pro rata basis so that he will be fully vested and entitled to receive a
supplemental retirement benefit in the amount of at least Fifty Thousand Dollars
($50,000.00) per annum for a period of ten (10) years, commencing the first day
of the month following the later of his Retirement or his attainment of age
sixty-five (65). This benefit shall be provided under the Company's Executive
Supplemental Retirement Plan or otherwise as the Parties shall agree. In the
event that the Executive shall die before all ten (10) years of payments shall
have been received, the Executive's spouse shall be entitled to the remainder of
such payments.

             (o)     During the Employment Term, the Company shall reimburse the
Executive not less than One Thousand Five Hundred Dollars ($1,500.00) per year
toward the cost of an annual executive physical examination at The Cleveland
Clinic Foundation or other acceptable facility.

             (p)     The Executive shall be provided, at the Company's expense,
with director's and officer's liability insurance coverage with respect to
claims against the Executive arising in connection with his activities performed
on behalf of or in connection with his service as an officer or Director of the
Company or any affiliate.

             (q)     [Reserved]

        6.      TERMINATION OF EMPLOYMENT. As indicated in Subsection 3(b), the
Employment Term may terminate prior to the date specified therein as follows:

             (a)     The Executive's employment hereunder will terminate without
further notice upon the death of the Executive.

             (b)     The Company may terminate the Executive's employment
hereunder upon the Executive's Disability, if the Executive is prevented from
performing his duties hereunder by reason of physical or mental incapacity for a
period of one hundred eighty (180) consecutive days in any period of two
consecutive fiscal years of the Company, but in any such event the Executive
shall be entitled to full compensation and benefits hereunder until the close of
such one hundred and eighty (180) day period.

             (c)     The Executive may terminate his employment due to his
Retirement.

             (d)     The Company may terminate the Executive's employment
hereunder effective immediately upon giving written notice of such termination
for "Cause."

             (e)     The Company may terminate the Executive's employment
hereunder without Cause at any time upon thirty (30) days written notice.

             (f)     The Executive may terminate his employment hereunder
effective immediately upon giving written notice of such termination for "Good
Reason."

 

             (g)     The Executive may terminate his employment hereunder
without Good Reason at any time upon thirty (30) days written notice.

        7.     SEVERANCE COMPENSATION. If the Executive's employment terminates,
the following severance provisions will apply:

             (a)     If the Executive's employment is terminated by the Company
other than for Cause or is terminated by the Executive for Good Reason, then for
a period of one (1) year commencing on the Executive's termination date
("Payment Term"), the Company shall:

                       

(i)     pay to the Executive within thirty (30) days following his termination
of employment a single sum payment equal to one (1) times his annual Base Salary
in effect on the date of such termination of employment (or if such annual Base
Salary has decreased during the one year period ending on the date of the
Executive's termination of employment, at the highest rate in effect during such
period);

                       

(ii)     pay to the Executive within thirty (30) days following his termination
of employment a single sum payment equal to one (1) times his Annual Bonus at
the highest rate in effect during the prior three year period, , plus the sum of
any Annual Bonus earned but unpaid at the date of such termination of
employment;

                       

(iii)     continue in effect the medical and dental coverage, long and
short-term disability protection, and any life insurance protection (including
life and long-term disability insurance protection under policies obtained by
the Executive), being provided to the Executive immediately prior to the
Executive's termination of employment, or if any of such benefits have decreased
during the one year period ending on the Executive's termination of employment,
at the highest level in effect during such one year period;

                       

(iv)     continue to pay the automobile allowances as provided in
Subsections 5(e) hereof; and

                       

(v)     pay for executive outplacement services for the Executive from a
nationally recognized executive outplacement firm at the level provided for the
most senior executives, provided that such outplacement services will be
provided for a one year period commencing on the date of termination of
employment regardless of the Payment Term.  

             (b)      If the Executive's employment with the Company is
terminated by reason of the Executive's death or Disability during the
Employment Term, the Executive or his surviving spouse shall be entitled to
receive (i) the Base Salary and Annual Bonus accrued and unpaid to the date of
death or Disability, (ii) any amounts payable under any employee benefit plan of
the Company in accordance with the terms of such plan, and (iii) if the
Executive and/or his surviving spouse and dependents properly elect continued
medical coverage in accordance with Code Section 4980B ("COBRA"), the Company
shall pay the entire cost of the premiums for such continued medical coverage
for the longer of (A) the maximum required period of coverage under Code Section
4980B(f) or (B) thirty-six (36) months.

             (c)     If the Executive's employment hereunder is terminated by
the Company for Cause or terminated by the Executive other than for Good Reason,
then no further compensation or benefits will be provided to the Executive by
the Company under this Agreement following the date of such termination of
employment other than payment of compensation earned to the date of termination
of employment but not yet paid. As more fully and generally provided in
Section 19 hereof, this Subsection 7(c) shall not be interpreted to deny the
Executive any benefits to which he may be entitled under any plan or arrangement
of the Company applicable to the Executive.

             (d)     The Company's payments pursuant to this Section 7 that
result in additional taxable income to the Executive shall be increased by a
forty percent (40%) tax gross-up payment to the Executive for the purposes of
covering federal, state and local income taxes on the amount of such payments.

             (e)     Notwithstanding anything contained in this Agreement to the
contrary, other than Section 19 hereof, if the Executive breaches any of the
Executive's obligations under Section 11 or 12 hereof, and such breach is not
substantially cured in all material respects within thirty (30) days after the
Board gives written notice thereof to the Executive, no further severance
payments or other benefits will be payable to the Executive under this
Section 7.

        8.     CHANGE IN CONTROL.

             (a)    In General. In the event of a Change in Control, the
Executive shall have certain special protections so that he may more fully focus
on the issues related to such a Change in Control, and to reward the Executive
for the substantial additional effort involved in a Change in Control. The
protections and rights are set forth in this Section 8.

                       

(i)     In the event of a Change in Control, the Executive may terminate his
employment with the Company at any time within the following eighteen (18)
months and it will be considered a termination for Good Reason under this
Agreement.

                       

(ii)    In the event of a Change in Control, the Executive may elect to extend
this Agreement for a period of eighteen (18) months.

                       

(iii)    In the event of a Change in Control, the Company will pay the
Executive, within thirty (30) days following the date of such Change in Control,
the amount of any Annual Bonus earned but unpaid as of that date.

                       

(iv)    In the event of a Change in Control, the Executive will become fully
vested in all outstanding stock options, restricted stock or similar awards and
any option shall become fully exercisable. The Executive shall have at least
ninety (90) days following the date of the Change in Control to exercise any
option or right with respect to any such award.

                       

(v)     In the event of a Change in Control, the Executive will have available
the expenses of enforcement provided in Section 23 hereof.

             (b)     Section 280G Protection. The Executive shall be entitled to
a cash payment (the "Excise Tax Gross-Up Payment") equal to the amount of excise
taxes which the Executive is required to pay pursuant to Section 4999 of the
Internal Revenue Code of 1986, as amended ("Code"), as a result of any
"parachute payments" as defined in Section 280G(b)(2) of the Code made by or on
behalf of the Company or any successor thereto, under this Agreement or
otherwise, resulting in an "excess parachute payment" as defined in Section
280G(b)(1) of the Code. In addition to the foregoing, the Excise Tax Gross-Up
Payment due to the Executive under this Section 8 shall be increased by the
aggregate of the amount of federal, state and local income, excise and penalty
taxes, and any interest on any of the foregoing, for which the Executive will be
liable on account of the Excise Tax Gross-Up Payment to be made under this
Section 8, such that the Executive will receive the Excise Tax Gross-Up Payment
net of all income, excise and penalty taxes, and any interest on any of the
foregoing, imposed on the Executive on account of the receipt of the Excise Tax
Gross-Up Payment. The computation of the Excise Tax Gross-Up Payment shall be
determined, at the expense of the Company or its successor, by an independent
accounting, actuarial or consulting firm selected by the Company or its
successor. Such Excise Tax Gross-Up Payment shall be made by the Company or its
successor at such time as the Company or its successor shall determine, in its
sole discretion, but in no event later than the date five (5) business days
before the due date, without regard to any extension, for filing the Executive's
federal income tax return for the calendar year for which it is determined that
excise taxes are payable under Section 4999 of the Code. Notwithstanding the
foregoing, there shall be no duplication of payments by the Company or its
successor under this Section 8 in respect of excise taxes under Section 4999 of
the Code to the extent the Company or its successor is making payments in
respect of such excise taxes under any other arrangement with the Executive. In
the event that the Executive is ultimately assessed with excise taxes under
Section 4999 of the Code which exceed the amount of excise taxes used in
computing the Executive's payment under this Section 8, the Company or its
successor shall indemnify the Executive for such additional excise taxes plus
any additional excise taxes, income taxes, interest and penalties resulting from
the additional excise taxes and the indemnity hereunder.

        9.     SEVERANCE PLAN. It is the intention of the Parties that this
Agreement provide special benefits to the Executive. If at any time the Company
maintains a Severance Benefit Plan that would provide better cash severance
benefits to the Executive than this Agreement, the Executive may elect to
receive such better cash severance benefits in lieu of the cash severance
benefits provided under Subsections 7(a)(i) and 7(a)(ii) of this Agreement while
continuing to receive any other benefits or coverages available under this
Agreement. If this Agreement would provide better cash severance benefits to the
Executive than a Severance Benefit Plan maintained by the Company, the Executive
shall receive the cash severance benefits under this Agreement, as well as any
other benefits or coverages available under this Agreement. In such case, the
cash severance benefits under this Agreement shall be in lieu of the cash
severance benefits payable under a Severance Benefit Plan.

        10.     PLAN AMENDMENTS. To the extent any provisions of this Agreement
modify the terms of any existing plan, policy or arrangement affecting the
compensation or benefits of the Executive, as appropriate, (a) such modification
as set forth herein shall be deemed an amendment to such plan, policy or
arrangement as to the Executive, and both the Company and the Executive hereby
consent to such amendment, (b) the Company will appropriately modify such plan,
policy or arrangement to correspond to this Agreement with respect to the
Executive, or (c) the Company will provide an "Alternative Benefit," as defined
in Section 17 hereof, to or on behalf of the Executive in accordance with the
provisions of such Section 17.

        11.     CONFIDENTIAL INFORMATION. The Executive agrees that the
Executive will not, during the Employment Term or at any time thereafter, either
directly or indirectly, disclose or make known to any other person, firm, or
corporation any confidential information, trade secret or proprietary
information of the Company in violation of the Company's policies and
procedures.

        12.     [ReservedESERVED]

        13.     ARBITRATION. The following arbitration rules shall apply to this
Agreement:

              (a)     In the event that the Executive's employment shall be
terminated by the Company during the Employment Term or the Company shall
withhold payments or provision of benefits because the Executive is alleged to
be engaged in activities prohibited by Section 11 or 12 hereof or for any other
reason, the Executive shall have the right, in addition to all other rights and
remedies provided by law, at his election either to seek arbitration in the
metropolitan area of Akron, Ohio, under the Commercial Arbitration Rules of the
American Arbitration Association by serving a notice to arbitrate upon the
Company or to institute a judicial proceeding, in either case within one hundred
and twenty (120) days after having received notice of termination of his
employment.

              (b)     Without limiting the generality of Subsection 13(a), this
Subsection 13(b) shall apply to termination asserted to be for "Cause" or for
"Good Reason." In the event that (i) the Company terminates the Executive's
employment for Cause, or (ii) the Executive resigns his employment for Good
Reason, the Company and the Executive each shall have thirty (30) days to demand
of the American Arbitration Association in writing (with a copy to the other
Party) that arbitration be commenced to determine whether Cause or Good Reason,
as the case may be, existed with respect to such termination or resignation. The
Parties shall have thirty (30) days from the date of such written request to
select such third party arbitrator. Upon the expiration of such thirty (30) day
period, the Parties shall have an additional thirty (30) days in which to
present to such third party arbitrator such arguments, evidence or other
material (oral or written) as may be permitted and in accordance with such
procedures as may be established by such third party arbitrator. The third party
arbitrator shall furnish a written summary of his findings to the Parties not
later than thirty (30) days following the last day on which the parties were
entitled to present arguments, evidence or other material to the third party
arbitrator.

During the period of resolution of a dispute under this Subsection 13(b), the
Executive shall receive no compensation by the Company (other than payment by
the Company of premiums due before or during such period on any insurance
coverage applicable to the Executive hereunder) and the Executive shall have no
duties for the Company. If the arbitrator determines that the Company did not
have Cause to terminate the Executive's employment or that the Executive had
Good Reason to resign his employment, as the case may be, the Company shall
promptly pay the Executive in a lump sum any compensation to which the Executive
would have been entitled, for the period commencing with the date of the
Executive's termination or resignation and ending on the date of such
determination, had his employment not been terminated or had he not resigned.

        14.     NOTICES. For purposes of this Agreement, all communications
provided for herein shall be in writing and shall be deemed to have been duly
given when hand delivered or mailed by United States registered or certified
mail, return receipt requested, postage prepaid, addressed as follows:

(a)     If the notice is to the Company:

 

        Myers Industries, Inc.
        1293 South Main Street
        Akron, OH 44301

        Attn: President

 

(b)     If the notice is to the Executive:

 

Mr. Kevin C. O'Neil
711 Kensington Way
Copley, OH 44321

 

or to such other address as either Party may have furnished to the other in
writing and in accordance herewith; except that notices of change of address
shall be effective only upon receipt.

        15.     ASSIGNMENT; BINDING EFFECT. This Agreement shall be binding upon
and inure to the benefit of the parties to this Agreement and their respective
successors, heirs (in the case of the Executive) and permitted assigns. No
rights or obligations of the Company under this Agreement may be assigned or
transferred by the Company except that such rights or obligations may be
assigned or transferred in connection with the sale or transfer of all or
substantially all of the assets of the Company, provided that the assignee or
transferee is the successor to all or substantially all of the assets of the
Company and such assignee or transferee expressly assumes the liabilities,
obligations and duties of the Company, as contained in this Agreement, either
contractually or as a matter of law. The Company further agrees that, in the
event of a sale or transfer of assets as described in the preceding sentence, it
shall be a condition precedent to the consummation of any such transaction that
the assignee or transferee expressly assumes the liabilities, obligations and
duties of the Company hereunder. No rights or obligations of the Executive under
this Agreement may be assigned or transferred by the Executive other than the
Executive's rights to compensation and benefits, which may be transferred only
by will or operation of law, except as provided in this Section 15.

        The Executive shall be entitled, to the extent permitted under any
applicable law, to select and change a beneficiary or beneficiaries to receive
any compensation or benefits payable hereunder following the Executive's death
by giving the Company written notice thereof. In the absence of such a
selection, any compensation or benefit payable under this Agreement following
the death of the Executive shall be payable to the Executive's spouse, or if
such spouse shall not survive the Executive, to the Executive's estate. In the
event of the Executive's death or a judicial determination of the Executive's
incompetence, reference in this Agreement to the Executive shall be deemed,
where appropriate, to refer to the Executive's beneficiary, estate or other
legal representative.

        16.     INVALID PROVISIONS. Any provision of this Agreement that is
prohibited or unenforceable shall be ineffective to the extent, but only to the
extent, of such prohibition or unenforceability without invalidating the
remaining portions hereof and such remaining portions of this Agreement shall
continue to be in full force and effect. In the event that any provision of this
Agreement shall be determined to be invalid or unenforceable, the Parties will
negotiate in good faith to replace such provision with another provision that
will be valid or enforceable and that is as close as practicable to the
provisions held invalid or unenforceable.

        17.     ALTERNATIVE SATISFACTION OF COMPANY'S OBLIGATIONS. In the event
this Agreement provides for payments or benefits to or on behalf of the
Executive which cannot be provided under the Company's benefit plans, policies
or arrangements either because such plans, policies or arrangements no longer
exist or no longer provide such benefits or because provision of such benefits
to the Executive would adversely affect the tax qualified or tax advantaged
status of such plans, policies or arrangements for the Executive or other
participants therein, the Company may provide the Executive with an "Alternative
Benefit," as defined in this Section 17, in lieu thereof. The Alternative
Benefit is a benefit or payment which places the Executive and the Executive's
dependents or beneficiaries, as the case may be, in at least as good of an
economic position as if the benefit promised by this Agreement (a) were provided
exactly as called for by this Agreement, and (b) had the favorable economic, tax
and legal characteristics customary for plans, policies or arrangements of that
type. Furthermore, if such adverse consequence would affect the Executive or the
Executive's dependents, the Executive shall have the right to require that the
Company provide such an Alternative Benefit.

        18.     ENTIRE AGREEMENT, MODIFICATION. Subject to the provisions of
Section 19 hereof, this Agreement contains the entire agreement between the
Parties with respect to the employment of the Executive by the Company and
supersedes all prior and contemporaneous agreements, representations, and
understandings of the Parties, whether oral or written. No modification,
amendment, or waiver of any of the provisions of this Agreement shall be
effective unless in writing, specifically referring hereto, and signed by both
Parties.

        19.     NON-EXCLUSIVITY OF RIGHTS. Notwithstanding the foregoing
provisions of Section 18, nothing in this Agreement shall prevent or limit the
Executive's continuing or future participation in any benefit, bonus, incentive
or other plan, program, policy or practice provided by the Company for its
executive officers, nor shall anything herein limit or otherwise affect such
rights as the Executive has or may have under any stock option, restricted stock
or other agreements with the Company or any of its subsidiaries. Amounts which
the Executive or the Executive's dependents or beneficiaries, as the case may
be, are otherwise entitled to receive under any such plan, policy, practice or
program shall not be reduced by this Agreement except as provided in Section 9
hereof with respect to payments under a Company sponsored Severance Benefit Plan
if cash payments are made hereunder.

        20.     WAIVER OF BREACH. The failure at any time to enforce any of the
provisions of this Agreement or to require performance by the other Party of any
of the provisions of this Agreement shall in no way be construed to be a waiver
of such provisions or to affect either the validity of this Agreement or any
part of this Agreement or the right of either Party thereafter to enforce each
and every provision of this Agreement in accordance with the terms of this
Agreement.

        21.     GOVERNING LAW. This Agreement has been made in, and shall be
governed and construed in accordance with the laws of, the State of Ohio. The
Parties agree that this Agreement is not an "employee benefit plan" or part of
an "employee benefit plan" which is subject to the provisions of the Employee
Retirement Income Security Act of 1974, as amended.

        22.     TAX WITHHOLDING. The Company may withhold from any amounts
payable under this Agreement such federal, state or local taxes or other amounts
as shall be required to be withheld pursuant to any applicable law or
regulation. Where withholding applies to shares of the Company's common stock,
the Company shall make cashless withholding available to the Executive if
permissible by law.

        23.     EXPENSES OF ENFORCEMENT.

              (a)    Following a Change in Control. The Company is aware that
upon the occurrence of a Change in Control the Board or a shareholder of the
Company may then cause or attempt to cause the Company to refuse to comply with
its obligations under this Agreement, or may cause or attempt to cause the
Company to institute, or may institute, litigation seeking to have this
Agreement declared unenforceable, or may take, or attempt to take, other action
to deny the Executive the benefits intended under this Agreement. In these
circumstances, the purpose of this Agreement could be frustrated. It is the
intent of the Company that the Executive not be required to incur the expenses
associated with the enforcement of his rights under this Agreement by litigation
or other legal action because the cost and expense thereof would substantially
detract from the benefits intended to be extended to the Executive hereunder,
nor be bound to negotiate any settlement of his rights hereunder under threat of
incurring such expenses. Accordingly, if following a Change in Control it should
appear to the Executive that the Company has failed to comply with any of its
obligations under this Agreement or in the event that the Company or any other
person takes any action to declare this Agreement void or unenforceable, or
institutes any litigation or other legal action designed to deny, diminish or to
recover from, the Executive, the benefits intended to be provided to the
Executive hereunder, and that the Executive has complied with all of his
obligations under this Agreement, the Company irrevocably authorizes the
Executive from time to time to retain counsel of his choice at the expense of
the Company as provided in this Section 23, to represent the Executive in
connection with the initiation or defense of any litigation or other legal
action, whether by or against the Company or any Director, officer, shareholder
or other person affiliated with the Company, in any jurisdiction.
Notwithstanding any existing or prior attorney-client relationship between the
Company and such counsel, the Company irrevocably consents to the Executive
entering into an attorney-client relationship with such counsel, and in that
connection the Company and the Executive agree that a confidential relationship
shall exist between the Executive and such counsel. The reasonable fees and
expenses of counsel selected from time to time by the Executive as herein
provided shall be paid or reimbursed to the Executive by the Company on a
regular, periodic basis upon presentation by the Executive of a statement or
statements prepared by such counsel in accordance with its customary practices,
up to a maximum aggregate amount of Five Hundred Thousand Dollars ($500,000.00).

              (b)    In General. The Company shall reimburse reasonable attorney
fees and expenses incurred by the Executive to enforce the provisions of this
Agreement, even if his claims are not successful, provided they are not
ultimately determined by the court or arbitrator, as the case may be, to be
frivolous.

 

        24.     REPRESENTATION. The Company represents and warrants that it is
fully authorized and empowered to enter into this Agreement and that the
performance of its obligations under this Agreement will not violate any
agreement between it and any other person, firm or organization.

        25.     SUBSIDIARIES AND AFFILIATES. Notwithstanding any contrary
provision of this Agreement, to the extent it does not adversely affect the
Executive, the Company may provide the compensation and benefits to which the
Executive is entitled hereunder through one or more subsidiaries or affiliates.

 

        26.     NO MITIGATION OR OFFSET. In the event of any termination of
employment, the Executive shall be under no obligation to seek other employment.
Amounts due the Executive under this Agreement shall not be offset by any
remuneration attributable to any subsequent employment he may obtain.

         27.      SOLE REMEDY. The Parties agree that the remedies of each
against the other for breach of this Agreement shall be limited to enforcement
of this Agreement and recovery of the amounts and remedies provided for herein.
The Parties, however, further agree that such limitation shall not prevent
either Party from proceeding against the other to recover for a claim other than
under this Agreement.

         IN WITNESS WHEREOF, the Company and the Executive have executed this
Agreement as of the day and year first above written.

MYERS INDUSTRIES, INC.

(the "Company")

   

By: /s/ John C. Orr

JOHN C. ORR, President and

Chief Executive Officer

   

EXECUTIVE

 

 

/s/ Kevin C. O'Neil

KEVIN C. O'NEIL