exv10w2



 








Exhibit 10.2




EMPLOYMENT AGREEMENT




     This Employment Agreement (“Agreement”) is entered into by and between
ICO, Inc. (the “Company”) and Paul Giddens (“Employee”), to be effective as of
May 24, 2004 (the “Effective Date”).



WITNESSETH:




     WHEREAS, Employee will become employed by Company on the Effective Date;
and



     WHEREAS, the Company desires to employ Employee from and after the
Effective Date pursuant to the terms and conditions and for the consideration
set forth in this Agreement, and Employee desires to be employed by Company
pursuant to such terms and conditions and for such consideration.



     NOW, THEREFORE, for and in consideration of the mutual promises,
covenants, and obligations contained herein, the Company and Employee agree as
follows:



ARTICLE 1: EMPLOYMENT AND DUTIES:




     1.1 The Company agrees to employ Employee, and Employee agrees to be
employed by the Company, beginning as of the Effective Date and continuing
until the date of termination of Employee’s employment (“Termination Date”),
subject to the terms and conditions of this Agreement. The “Employment
Period,” as used herein, shall mean the period commencing on the Effective
Date, and ending on the Termination Date. The “Term,” as used herein, shall
mean the two year period commencing on the Effective Date, and expiring at
midnight of the day before the second anniversary of the Effective Date.




	(a)	 	At least six (6) weeks prior to the expiration of the Term
(and each mutually agreed to extension thereof), the board of
directors (“Board”) of the Company shall notify the Employee, in
writing pursuant to Section 5.1, of the Board’s desire to continue
Employee’s employment beyond the end of the Term (or any mutually
agreed to extension thereof). If the Board desires to retain the
Employee, then the parties shall amend this agreement to extend the
Employment Period for an additional two-year period (“Extension
Period”), and the Term (or any mutually agreed to extension thereof)
shall be extended for an additional two years, or a new employment
agreement (on substantially the same terms as this Agreement) shall
be negotiated, prepared, and put into effect prior to the end of the
Term (or any mutually agreed to extension thereof); however if the
parties cannot agree to the terms of a new agreement by the
expiration of the Term (or




Page 1 of 17











 






	 	 	any mutually agreed to extension thereof), then Employee’s
employment shall terminate at the end of the Term (or any mutually
agreed to extension thereof), and shall be subject to 3.1(d).
	 
	(b)	 	For the avoidance of doubt it is the parties’ understanding
that if this Agreement is extended for an Extension Period or any
subsequent Extension Period, at the end of any such Extension
Period, the provisions of Section 1.1(a) shall apply, and any
reference in this Agreement to the Term shall include any mutually
agreed extension thereof, whether or not expressly noted.





     1.2 Beginning as of the Effective Date and throughout the Term (and
mutually agreed to extension thereof), Employee shall be employed as Vice
President of Human Resources & Administration of the Company. Employee may
also serve as an officer and/or director of the Company’s domestic and foreign
affiliated subsidiaries, and in such other key contributor capacities as may be
requested by the Employer. Employee agrees to serve in such positions, and to
perform diligently and to the best of Employee’s abilities the duties and
services pertaining to such positions as reasonably determined by Company, as
well as such additional or different duties and services appropriate to such
positions which the Employee from time to time may be directed to perform by
the Company. Employee shall report to the Chief Executive Officer (the “CEO”).



     1.3 Employee shall at all times comply with and be subject to such
policies and procedures as the Company may establish from time to time,
including, without limitation, the Company’s Employee Handbook and Code of
Business Ethics.



     1.4 Employee shall, during the Employment Period, devote Employee’s full
business time, energy, and best efforts to the business and affairs of the
Company. Employee may not engage, directly or indirectly, in any other
business, investment, or activity that interferes with Employee’s performance
of Employee’s duties hereunder, is contrary to the interest of the Company or
any of its affiliated subsidiaries and divisions (collectively, the “ICO
Entities” or, individually, an “ICO Entity”), or requires any significant
portion of Employee’s business time. The ICO Entities as of the Effective Date
are listed on Exhibit A attached hereto and incorporated herein. In the event
that, during the Employment Period, any of the ICO Entities establish or
purchase a 10% or more direct or indirect equity interest in any entity not
listed on Exhibit A, such entity shall be deemed to be an ICO Entity for the
purposes of this Agreement. The foregoing notwithstanding, the parties
recognize and agree that Employee may engage in passive personal investments
and other business activities which do not conflict with the business and
affairs of the Company or the ICO Entities or interfere with Employee’s
performance of his duties hereunder. Employee shall be eligible to serve on
the board of directors or committees thereof of entities that are not ICO
Entities during Employee’s employment by the Company, subject to the Board’s
advance consideration and approval thereof. Employee shall be permitted to
retain any compensation received for approved service on any unaffiliated
corporation’s board of directors or committees thereof.



Page 2 of 17











 





     1.5 Employee acknowledges and agrees that Employee owes a fiduciary duty
of loyalty, fidelity, and allegiance to act at all times in the best interests
of the Company and other ICO Entities and to do no act which would, directly or
indirectly, injure any such entity’s business, interests, or reputation. It is
agreed that any direct or indirect interest in, connection with, or benefit
from any outside activities, particularly commercial activities, which interest
might in any way adversely affect the Company, or any ICO Entity, involves a
possible conflict of interest. In keeping with Employee’s fiduciary duties to
the Company, Employee agrees that during the Employment Period Employee shall
not knowingly become involved in a conflict of interest with the Company or the
ICO Entities, or upon discovery thereof, allow such a conflict to continue.
Moreover, during the Employment Period Employee shall not engage in any
activity which might involve a possible conflict of interest without first
obtaining approval in accordance with this Agreement and the Company’s policies
and procedures.



ARTICLE 2: COMPENSATION AND BENEFITS:




     2.1 During the Employment Period, the Employee shall receive a base salary
(“Base Salary”) of One Hundred and Fifty Thousand Dollars ($150,000) per annum,
less all required deductions, including but not limited federal withholding,
social security and other taxes, and payable bi-weekly on the Company’s regular
payroll schedule. During the Employment Period, the Base Salary may be
reviewed periodically by the Compensation Committee of the Board (the
“Compensation Committee”). The Compensation Committee may make recommendations
to the Board to revise the Employee’s Base Salary, which may only be revised
upon approval by the Board. Any increase in the Base Salary shall not serve to
limit or reduce any other obligation to the Employee under this Agreement.
During the Term (and each mutual extension thereof), the Base Salary shall not
be reduced.



     2.2 In addition to the Base Salary, the Employee shall be eligible, to
receive the following bonus payments:




(a) “Guaranteed” bonus payments, payable as follows: (i) a one-time bonus
of Five Thousand Dollars ($5,000), to be paid on December 31, 2004, and
(ii) a one-time bonus of Seven Thousand, Five Hundred Dollars ($7,500),
to be paid on December 31, 2005. In the event that Employee’s employment
terminates for any reason prior to the date when a bonus payment referred
to in this paragraph is due, Employee shall not be entitled to receive
such bonus payment.




(b) An “incentive” bonus payment for the Company’s fiscal year 2004 of up
to Five Thousand Dollars ($5,000), which shall only be payable if: (i)
the Company meets its $9.8 million EBIDTA target (the accomplishment of
which shall be determined solely by the Board); and (ii) Employee
satisfies all individual performance targets established by the CEO (the
accomplishment of which shall be determined solely by the CEO). In the
event that the referenced $9.8 million EBIDTA target is achieved and
Employee only



Page 3 of 17











 






satisfies a portion of the individual performance targets referenced in
(ii), the CEO shall may, at the CEO’s sole discretion, award an
“incentive” bonus for the Company’s fiscal year 2004 that is less than
$5,000.



     2.3. In addition to the Base Salary and other benefits afforded to
Employee under this Agreement, on the Effective Date Employee shall receive
options (“Options”) to purchase 25,000 shares of the Common Stock of the
Company (“Shares”).



     The Options shall vest as follows:




	(a)	 	Options to purchase 8,334 Shares shall be 100%
fully vested on the first anniversary of the Effective Date.
	 
	(b)	 	Options to purchase 8,333 Shares shall be 100%
fully vested on the second anniversary of the Effective Date.
	 
	(c)	 	Options to purchase 8,333 Shares shall be 100%
fully vested on the third anniversary of the Effective Date.






All of the 25,000 Options shall be granted at an exercise price equal to
the greater of $2.00 per share or the Fair Market Value (as defined in
the applicable stock option plan under which the options are granted) of
the Common Stock on the Effective Date, and to the extent permitted under
the Internal Revenue Code, shall be Incentive Stock Options (“ISOs”).
The Options shall expire on the seventh anniversary of the Effective
Date. Notwithstanding the foregoing, upon termination of Employee’s
employment for any reason then the options shall expire upon the first
business day following the expiration of the three (3) month period after
Employee’s Termination Date. The Options shall be granted under the
terms of the Company’s 1994, 1995, 1996, and/or 1998 Employee Stock
Option Plans, at the Company’s discretion, or on terms substantially
identical to the terms in such plans, and subject to the Employee’s
execution of option agreements in compliance with all terms and
conditions of the applicable plans.



     2.4 During the Employment Period, the Employee shall be entitled to
participate in incentive, savings, and retirement plans, and other standard
benefit plans afforded to executive-level employees of the Company, including,
without limitation, all medical, dental, disability, group life, accidental
death, D&O indemnity, and travel accident insurance plans and programs of the
Company, to the extent Employee is otherwise eligible under the terms and
conditions of the applicable plan or policy, and as such plans or policies may
be from time to time be amended, modified or terminated by the Company without
prior notice. Dependents of Employee may participate in such plans to the
extent allowed for other dependants of executive level Employees of the Company
as allowed by the applicable plan. This Agreement shall not be construed to limit in any respect the Company’s right to establish, amend,
modify, or terminate





Page 4 of 17











 






any benefit plan or policy. Furthermore, the Company
shall not by reason of this Article 2 be obligated to institute, maintain, or
refrain from changing, amending, or discontinuing, any incentive compensation,
employee benefit, or stock or stock option program or plan, so long as such
actions are similarly applicable to covered employees generally.



     2.5 During the Employment Period, the Company shall pay or reimburse
Employee for all actual, reasonable, and customary expenses incurred by
Employee in the course of his employment, including business-related travel
expenses and the costs associated with a Company issued mobile phone, subject
to the terms of and Employee’s compliance with the Company’s Global Employee
Business Expense Policy, as amended from time to time, and any other applicable
Company policies related to business expenses. Furthermore, in lieu of use of
a Company vehicle, and maintenance, repair, and insurance expenses associated
therewith, the Employee shall receive a monthly vehicle allowance in the sum of
$700.00 (“Vehicle Allowance”), paid on the first payday of each month.



     2.6 During the Employment Period, the Employee shall be entitled to two
weeks of vacation, fully paid, per calendar year.



     2.7 The Company may withhold from any compensation, benefits, or amounts
payable under this Agreement all federal, state, city, or other taxes as may be
required pursuant to any law or governmental regulation or ruling.



     2.8 No amendment, modification, or repeal of Article Eleven of the
Articles of Incorporation of the Company (as amended on or before the date
hereof) or Article 7 of the Amended and Restated Bylaws of ICO, Inc., as
amended October 5, 2001, shall have the effect of limiting or denying any
indemnification rights with respect to actions of Employee occurring, or
proceedings arising, prior to such amendment, modification, or repeal, which
indemnification rights Employee would otherwise have been entitled to if such
amendment, modification, or repeal had not been effectuated, and the
provisions of Article 7 of the Amended and Restated Bylaws of ICO, Inc., as
amended October 5, 2001, shall continue to apply to Employee with respect to
actions taken or proceedings arising prior to such amendment, modification, or
repeal, as if such amendment, modification or repeal had not been effectuated.
Notwithstanding the foregoing, nothing in this Section 2.9 shall entitle
Employee to indemnification (i) to any extent not permitted by the Texas
Business Corporation Act, as amended from time to time, and (ii) with respect
to actions occurring at or after (but not as to actions of Employee occurring
prior to) the time of such amendment, modification, or repeal that are the
basis for Employee’s claim for indemnity to any extent that indemnity for such
later actions of Employee is not permitted by such Articles of Incorporation or
Bylaws as so amended, modified, or repealed. Employee’s rights to
indemnification shall continue in effect after the termination of this
Agreement, regardless of the cause of termination, for a period of five (5)
years thereafter, and as to any claim for indemnification raised or in
existence during that five-year period, Employee’s rights and the
Company’s obligations under this Section 2.9 shall continue until such
claim is resolved without further right of appeal.



Page 5 of 17











 





ARTICLE 3: TERMINATION OF EMPLOYMENT AND EFFECTS OF SUCH TERMINATION:




     3.1 (a) Employee’s employment shall be terminated during the Employment
Period by reason of the following circumstances:




	(i)	 	Death of Employee.
	 
	(ii)	 	Permanent Disability. “Permanent Disability” shall
mean Employee’s physical or mental incapacity to perform his
usual duties, with such condition likely to remain continuously
and permanently as determined by the Board of Directors. The
decisions as to whether and as of what date Employee has become
permanently disabled are delegated to the Board of Directors for
determination, and any dispute of Employee with any such
decision shall be limited to whether the Board of Directors
reached such decision in good faith.
	 
	(iii)	 	Voluntary Termination. “Voluntary Termination”
shall mean a termination of employment at the election of
Employee (other than for Good Reason, as defined in Section
3.2(b) below), including termination upon the expiration of the
Term because Employee does not desire to continue his employment
beyond the end of the Term (as described in Section 3.1(d)(i)
below). Employee will provide the Company with six (6) weeks
advance notice of his intent to terminate his employment
voluntarily. Employee shall continue to remain an employee of
the Company through the six week notice period and will perform
such duties, if any, assigned to him by the Company during the
notice period. Notwithstanding the foregoing, the Company may,
at its option, waive the Employee’s obligation to remain an
employee during all or any portion of the six week notice
period, in which case Employee’s employment shall cease
immediately.
	 
	(iv)	 	Termination by Company for Cause. “Termination for
Cause” shall mean a termination of employment immediately upon
notice to the Employee from the Company that an event
constituting “Cause” has occurred. For purposes of this
Agreement, the term “Cause” shall be defined as: (a) an act of
dishonesty or fraud; (b) a knowing and material violation of any
written policy of the Company or applicable to the Company’s
operations; (c) a knowing and material violation of an
applicable law, rule, or regulation that exposes the Company to
damages or liability; (d) a material breach of
fiduciary duty; or (e) conviction of a felony. In the event
that Employee is terminated for Cause, Employee shall be
provided with notice of such termination in accordance with
Section 5.1 below.




Page 6 of 17










 











     (b) In the event Employee’s employment terminates as a result of any of
the circumstances described in 3.1(a)(i) through (iv) above, all future
compensation to which Employee would otherwise be entitled and all future
benefits for which Employee is eligible shall cease and terminate as of the
Termination Date, except as specifically provided in this Section 3.1 or the
terms of any of the Company’s health or welfare plans, and Employee shall
receive payment, if any, for accrued and unused vacation days according to the
Company’s current policy applicable to payment for unused vacation. In the
event of termination for any of the reasons set forth in 3.1(a)(i) through (iv)
above, Employee shall not be entitled to receive an Annual Incentive Bonus for
the fiscal year in which the termination occurs, but shall be entitled to
receive an Annual Incentive Bonus, if any, that has been earned but not yet
paid to Employee for the fiscal year prior to the fiscal year in which the
termination occurs.



     (c) Notwithstanding anything contained in 3.1(b), in the event that
Employee’s employment terminates as a result of death or permanent disability
resulting from any accident or incident beyond Employee’s control that occurs
while Employee is traveling on Company business or is in the course and scope
of employment (excluding any accident or incident occurring when Employee is
traveling within Houston and to or from his normal place of business or his
residence), the preceding paragraph shall not apply, and instead Employee (or
his Estate, as the case may be) shall be entitled to receive payment subject to
and calculated in accordance with the provisions of Sections 3.2(a) and
3.2(a)(i) through (iv) below.



     (d) In the event that Employee’s employment terminates upon the expiration
of the Term because the parties are unable to agree to the terms of a new
agreement by the expiration of the Term (or any mutual extension thereof), then
the Termination Date shall be the last day of the Term (or any mutual extension
thereof), and:




	(i)	 	if the Company has offered to extend the Term of
this Agreement (or any mutual extension thereof) (without
amending the terms of this Agreement, other than by increasing
Employee’s salary, bonus, and/or other remuneration or
benefits hereunder), or to enter into a new agreement on terms
that are substantially the same as the terms of this Agreement
(other than by increasing Employee’s salary, bonus, and/or
other remuneration or benefits hereunder), then if Employee
declines to accept the Company’s offer, Employee’s termination
shall be treated as a Voluntary Termination, and the
provisions of Section 3.1(b) shall apply; or
	 
	(ii)	 	if the Company has not offered (x) to extend the
Term of this Agreement (or any mutual extension thereof)
(without amending the terms of this Agreement, other than by
increasing Employee’s salary, bonus, and/or
other remuneration or benefits hereunder), or (y) to enter
into a new agreement on terms that are substantially the same
as the terms of this Agreement (other than by increasing
Employee’s salary, bonus, and/or other remuneration or
benefits hereunder), then Employee shall be entitled




Page 7 of 17










 






	 	 	to a
“Termination Payment” subject to and calculated in accordance
with the provisions of Sections 3.2(a) and 3.2(a)(i) through
(iv) below.





     3.2 The Company reserves the right to terminate Employee’s employment for
any reason other than the circumstances described in Sections 3.1(a)(i) through
3.1(a)(iv) above, or to terminate Employee’s employment upon the expiration of
the Term, in which case it shall provide him with written notice of termination
(“Notice of Termination”). The Notice of Termination shall specify the
Termination Date.




	(a)	 	If the Termination Date occurs during the Term (or any mutual
extension thereof), or on the last day of the Term (or any mutual
extension thereof) because the Board does not desire to continue
Employee’s employment beyond the Term (or any mutual extension
thereof), Company shall pay Employee, within thirty (30) days after
the Termination Date, and after Employee’s execution of a full
release of all claims against the Company (excluding only claims for
benefits and payments to be payable after Termination Date under any
of the Company’s health or welfare plans, and claims for
indemnification against third parties pursuant to Article 7 of the
Amended and Restated Bylaws of ICO, Inc., as amended October 5,
2001), a “Termination Payment,” in lump sum cash (subject to
required taxes and withholdings) consisting of the following:






	(i)	 	pro rata Base Salary through the Termination
Date, and in the event that the prior fiscal year’s Annual
Incentive Bonus, if any, has been earned but not yet paid,
such Annual Incentive Bonus for the prior fiscal year; and
	 
	(ii)	 	payment, if any, for accrued and unused vacation
days according to the Company’s current policy applicable to
payment for unused vacation; and
	 
	(iii)	 	a sum equal to 100% of the Employee’s current
annual Base Salary.






	(b)	 	“Good Reason” shall mean a termination of employment by
Employee under any one of the following circumstances:






	(i)	 	In the event of a material breach by Company of
any material provision of this Agreement which remains
uncorrected for thirty (30) days following written notice
(“Material Breach Notice Period”) of such breach by Employee
to the Board, Employee may terminate this Agreement provided
that Employee provides the Board with written notice of such
termination, specifying a Termination Date that is on or after
the date of such written
notice but within sixty (60) days after the expiration of the
Material Breach Notice Period.
	 
	(ii)	 	In the event that there is any material
diminution of Employee’s job description, job role,
responsibilities, and/or scope of position during the Term,
Employee may terminate this Agreement upon written notice to
the




Page 8 of 17










 






	 	 	Board of Directors specifying a Termination Date that is
on or after the date of such written notice.
	 
	(iii)	 	If there is any amendment, modification, or
repeal of Article Eleven of the Articles of Incorporation of
the Company (as amended on or before the date hereof) and/or
Article 7 of the Amended and Restated Bylaws of ICO, Inc. (as
amended October 5, 2001) by the shareholders or the Board,
which amendment, modification, or repeal shall have the effect
of limiting or denying, except in any immaterial respect, any
indemnification rights that Employee would otherwise be
entitled to if such amendment, modification, or repeal had not
been effectuated, then Employee may terminate this Agreement
within thirty (30) days of the taking effect of such
amendment, modification, or repeal, upon written notice to the
Board.






In the event of such termination by Employee for Good Reason,
Employee shall be entitled to a Termination Payment subject to and
calculated in accordance with the provisions of Sections 3.2(a) and
3.2(a)(i) through (iv) above.



     3.3. Termination following a Change of Control



     (a) For the purposes of this Agreement, “Change of Control” means any of
the following events: (i) a merger, share exchange or consolidation in which
the Company will not be the surviving entity (or survives only as a subsidiary
of an entity), (ii) the sale or exchange by the Company all or substantially
all of its assets to any other person or entity, (iii) the acquisition of
ownership or control (including, without limitation, power to vote) by any
person or entity, including a “group” as contemplated by Section 13(d)(3) of
the 1934 Act, of more than 50% of the outstanding shares of the Company’s
voting stock (based upon voting power); provided, however, that a Change of
Control will not include (A) any reorganization, merger, consolidation, sale,
exchange, or similar transaction, which involves solely the Company and one or
more entities wholly-owned, directly or indirectly, by the Company immediately
prior to such event; or (B) the consummation of any transaction or series of
integrated transactions immediately following which the record holders of the
voting stock of the Company immediately prior to such transaction or series of
transactions continue to hold 50% or more of the voting stock (based upon
voting power) of (1) any entity that owns, directly or indirectly, the stock of
the Company, (2) any entity with which the Company has merged, or (3) any
entity that owns an entity with which the Company has merged.



     (b) A “COC Termination” shall be deemed to have occurred if (i) there is a
Change of Control during the Term (or any mutual extension thereof), and (ii)
within the twelve (12) month period immediately following the Change of Control
(but still within the Term (or any mutual extension thereof) (A) the Employee’s
employment terminates for any reason other than the circumstances described in
Sections 3.1(a)(i) through 3.1(a)(iii) above, (B) Employee is



Page 9 of 17










 





required to
relocate over 100 miles from Houston, Texas; (C) Employee is required to
commute to a location over 100 miles from the Company’s current corporate
offices; (D) Employee’s Base Salary is materially reduced or any other material
benefit of the Employee’s employment is materially reduced; or (E) there is any
material diminution of Employee’s job description, job role, responsibilities,
and/or scope of position. In the event of a COC Termination, the Company or
successor in interest shall be obligated to pay Employee, within thirty (30)
days after the Termination Date, and after Employee’s execution of a full
release of all claims against the Company (excluding only claims for benefits
and payments to be payable after Termination Date under any of the Company’s
health or welfare plans, and claims for indemnification against third parties
pursuant to Article 7 of the Amended and Restated Bylaws of ICO, Inc., as
amended October 5, 2001), a Termination Payment subject to and calculated in
accordance with the provisions of Sections 3.2(a) and 3.2(a)(i) through (iv)
above



     3.4 Any Termination Payment paid to Employee pursuant to Section 3.2 or
3.3 shall be in consideration of Employee’s continuing obligations under
Article 4. Nothing contained in this Article 3 shall be construed to be a
waiver by Employee of any benefits accrued for or due Employee under any
employee benefit plan (as such term is defined in the Employee Retirement
Income Security Act of 1974, as amended), maintained by the Company except that
Employee shall not be entitled to any severance benefits pursuant to any
severance plan or program of the Company.



     3.5 Termination of the employment relationship does not terminate those
obligations imposed by this Agreement which are continuing obligations,
including Employee’s obligations under Article 4.



ARTICLE 4:

OWNERSHIP AND PROTECTION OF INTELLECTUAL PROPERTY

AND CONFIDENTIAL INFORMATION;

NON-COMPETITION AGREEMENT:




     4.1 All information, ideas, concepts, improvements, discoveries, and
inventions, whether patentable or not, which are conceived, made, developed or
acquired by Employee, individually or in conjunction with others, during
Employee’s employment by the Company (whether during business hours or
otherwise and whether on the Company’s premises or otherwise) which relate to
the business, products or services of the Company or any of the ICO Entities
(including, without limitation, all such information relating to corporate
opportunities, confidential financial information, research and development
activities, sales data, pricing and trading terms, evaluations, opinions, interpretations, acquisition
prospects, the identity of customers or potential customers and their
requirements, the identity of key contacts within the customers’ organizations
or within the organizations of acquisition prospects, marketing and
merchandising techniques, prospective names, and marks), and all writings or
material of any



Page 10 of 17










 





type embodying any of such items, shall be the sole and
exclusive property of ICO or the ICO Entities, as the case may be.



     4.2 Employee acknowledges that the businesses of the Company and the ICO
Entities are highly competitive and that their strategies, methods, books,
records, and documents, their technical information concerning their products,
equipment, services, and processes, procurement procedures and pricing
techniques, the names of and other information (such as credit and financial
data) concerning their customers and business affiliates (including but not
limited to the products and/or services marketed, advertised, and/or sold to
customers and prospective customers, and the prices charged or quoted to them
for such products and/or services, and the business activities, needs, and
requirements for products and/or services of such customers or prospective
customers) all comprise confidential business information and trade secrets
which are valuable, special, and unique assets which the Company or the ICO
Entities use in their business to obtain a competitive advantage over their
competitors. Employee further acknowledges that protection of such
confidential business information and trade secrets against unauthorized
disclosure and use is of critical importance to the Company and the ICO
Entities in maintaining their competitive position. Employee hereby agrees
that Employee will not, at any time during or after the Employment Period, make
any unauthorized disclosure of any confidential business information or trade
secrets of the Company or any other ICO Entity, or make any use thereof, except
in the carrying out of his employment responsibilities hereunder. Confidential
business information shall not include information in the public domain (but
only if the same becomes part of the public domain through a means other than a
disclosure prohibited hereunder). The above notwithstanding a disclosure shall
not be unauthorized if (i) it is required by law or by a court of competent
jurisdiction or (ii) it is in connection with any judicial arbitration, dispute
resolution or other legal proceeding in which Employee’s legal rights and
obligations as an Employee or under this Agreement are at issue; provided,
however, that Employee shall, to the extent practicable and lawful in any such
events, give prior notice to the Company of his intent to disclose any such
confidential business information in such context so as to allow the Company or
the applicable ICO Entity an opportunity (which Employee will cooperate with
and will not oppose) to obtain such protective orders or similar relief with
respect thereto as may be deemed appropriate.



     4.3 All written materials, records, and other documents made by, or coming
into the possession of, Employee during the Employment Period which contain or
disclose confidential business information or trade secrets of the Company or
the ICO Entities shall be and remain the property of the Company or the ICO
Entities, as the case may be. Upon termination of Employee’s employment with
the Company, for any reason, Employee promptly shall deliver the same and all
copies thereof to the Company.



     4.4 To enable Employee to perform the duties contemplated by this
Agreement, the Company promises that it will disclose confidential information,
including confidential business information and trade secrets of the nature
described or referenced in Sections 4.1 – 4.3 above,



Page 11 of 17










 





during the Employment
Period and before termination of the employment relationship established by
this Agreement. In return for and ancillary to the promise made by the Company
to make such disclosure, Employee hereby makes a reciprocal promise designed to
enforce the Company’s interest in protecting its confidential information and
its goodwill. Accordingly, Employee promises to comply with the obligations
set forth in Sections 4.1 through 4.3 above, and furthermore, Employee agrees
that, during Employee’s employment with the Company and/or any other ICO
Entity, and for fifteen (15) months following the end of employment with the
Company or any other ICO Entity for any reason, Employee will not, directly or
through any other person, firm, or corporation, in any country in which the
Company or any ICO Entity does business:




	(a)	 	perform services as an employee, officer, director or
independent contractor for any Competing Enterprise (as defined
below);
	 
	(b)	 	be an owner, shareholder (except for the ownership by
Employee of less than Five Percent (5%) of the equity securities
of any publicly-traded company), agent, or partner of, or serve
in an executive position with, any Competing Enterprise;
	 
	(c)	 	call on or otherwise communicate with any customer or
prior customer of the Company and/or any ICO Entity, including
any respective successors and assigns, for the purpose of
soliciting business for a Competing Enterprise or for someone
other than the Company and/or other ICO Entities; or
	 
	(d)	 	do anything to interfere with the normal operation of
the businesses of the Company or any other ICO Entity, including,
without limitation, make any effort personally or through others
to recruit, hire, or solicit any employee or independent
contractor of the Company or another ICO Entity to leave the
Company or such ICO Entity, or to interfere in any way with any
ICO Entity’s relationships with its customers or suppliers.





For purposes of this Section, the term “Competing Enterprise” shall mean: any
person or any business organization of whatever form, excluding the Company
and/or any other ICO Entity, engaged directly or indirectly in any business or
enterprise whose business activities specifically relate to or involve: (i)
grinding, processing, blending, and/or compounding of polymer products for (a)
the rotational molding industry, or (b) any other industry that ICO Polymers
North America, Inc. or any other ICO Entity specifically services or sells to;
or (ii) the production of concentrates or compounds or other processing
services related to polymer products as conducted by Bayshore Industrial, Inc.
or any other ICO Entities.



ARTICLE 5: MISCELLANEOUS:




     5.1 For purposes of this Agreement, notices and all other communications
provided for herein shall be in writing and shall be deemed to have been duly
given when received by or



Page 12 of 17









 





tendered to Employee or the Company, as applicable,
by pre-paid courier or by United States registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:




	 	 	If to the Company, to
	 
	 	 	ICO, Inc., To the attention of the Chairman of the Board of Directors

5333 Westheimer Road, Suite 600

Houston, Texas 77056





or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.



     If to Employee, to his last known personal residence.



Notwithstanding the foregoing, any Notice of Termination pursuant to Article 3
may be delivered to the Employee in accordance with the above sentences in this
Section 5.1, or by email to the Employee’s Company email address, and in the
event of such delivery by email, the Delivery Date shall be conclusively
determined to be the date when such email was received on the Company’s server
regardless of the date when such email was opened by the Employee.



     5.2 This Agreement shall be governed by and construed and enforced, in all
respects in accordance with the law of the State of Texas, without regard to
principles of conflicts of law, unless preempted by federal law, in which case
federal law shall govern; provided, however, that the dispute resolution
process in Section 5.5 shall govern in all respects with regard to the
resolution of disputes hereunder.



     5.3 No failure by either party hereto at any time to give notice of any
breach by the other party of, or to require compliance with, any condition or
provision of this Agreement shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time.



     5.4 It is a desire and intent of the parties that the terms, provisions,
covenants, and remedies contained in this Agreement shall be enforceable to the
fullest extent permitted by law. If any such term, provision, covenant, or
remedy of this Agreement or the application thereof to any person, association,
or entity or circumstances shall, to any extent, be construed to be invalid or
unenforceable in whole or in part, then such term, provision, covenant, or
remedy shall be construed in a manner so as to permit its enforceability under
the applicable law to the fullest extent permitted by law. In any case, the
remaining provisions of this Agreement or the application thereof to any person, association, or entity or circumstances
other than those to which they have been held invalid or unenforceable, shall
remain in full force and effect.



     5.5 It is the mutual intention of the parties to have any dispute
concerning this Agreement resolved out of court. Accordingly, the parties
agree that any claim or controversy of



Page 13 of 17










 





whatever nature arising from or relating
in any way to this Agreement or the employment of the Employee by the Company,
and any continuing obligations under this Agreement, including disputes arising
under the common law or federal or state statutes, laws or regulations and
disputes with respect to the arbitrability of any claim or controversy, shall
be resolved exclusively by final and binding arbitration before a single
experienced employment arbitrator selected by the parties and conducted in
accordance with the agreement of the parties or as determined by the
arbitrator. If the parties are unable to agree to an arbitrator, an arbitrator
will be selected in accordance with the Employment Dispute Resolution (“EDR”)
Rules of the American Arbitration Association (“AAA”). The arbitration will be
conducted in Houston, Texas, pursuant to the EDR Rules of the AAA, and the
arbitrator shall have full authority to award or grant all remedies provided by
law. The judgment upon the award may be enforced by any court having
jurisdiction thereof. Each party shall pay the fees of their respective
attorneys, the expenses of their witnesses, and any other expenses incurred by
such party in connection with the arbitration; provided, however, that the
Company shall pay for the fees of the arbitrator or the administrative and
filing fees charged by the AAA. However, either party, on its own behalf and
on behalf of any other ICO Entities, shall be entitled to seek a restraining
order or injunction in any court of competent jurisdiction to prevent any
breach or the continuation of any breach of the provisions of herein.



     5.6 This Agreement shall be binding upon and inure to the benefit of the
Company, and any other person, association, or entity which may hereafter
acquire or succeed to all or substantially all of the business or assets of the
Company by any means whether direct or indirect, by purchase, merger,
consolidation, or otherwise. Employee’s rights and obligations under this
Agreement are personal and such rights, benefits, and obligations of Employee
shall not be voluntarily or involuntarily assigned, alienated, or transferred,
whether by operation of law or otherwise, without the prior written consent of
the Company.



     5.7 This Agreement replaces and extinguishes any previous agreements and
discussions pertaining to the subject matter covered herein. This Agreement
constitutes the entire agreement of the parties with regard to the terms of
Employee’s employment, termination of employment and severance benefits, and
contains all of the covenants, promises, representations, warranties, and
agreements between the parties with respect to such matters. Each party to
this Agreement acknowledges that no representation, inducement, promise, or
agreement, oral or written, has been made by either party with respect to the
foregoing matters which is not embodied herein, and that no agreement,
statement, or promise relating to the employment of Employee by the Company
that is not contained in this Agreement shall be valid or binding, except as
set forth in any applicable Employee benefit plan. It is understood that, by
signing below, Employee acknowledges that this Agreement supercedes any
agreements or understandings regarding the subject matter covered herein made
prior to the Employee signing this document. Any modification of this
Agreement will be effective only if it is in writing and signed by each party
whose rights hereunder are affected thereby, provided that any such



Page 14 of 17










 





modification must be authorized or approved by the Board of Directors or its
delegate, as appropriate.



Page 15 of 17










 





     IN WITNESS WHEREOF, the Company and Employee have duly executed this
Agreement in multiple originals to be effective on the Effective Date.




	 	 	ICO, Inc.
	 
	 	 	/s/ W. Robert Parkey, Jr.


By: W. Robert Parkey, Jr.

Title: President and C.E.O.
	 
	 	 	Date: May 11, 2004
	 
	 	 	Employee
	 
	 	 	/s/ Paul Giddens


Paul Giddens
	 
	 	 	Date: May 11, 2004




Page 16 of 17










 











EXHIBIT A




The ICO Entities (as defined in Section 1.4) are listed below, with country of
incorporation and state (if U.S.) indicated.



	 
	Bayshore Industrial, Inc. – USA, TX

	Courtenay Polymers Pty Ltd. - Australia

	Fabri-Moulds Ltd. - UK

	ICO Europe BV – The Netherlands

	ICO Global Services, Inc. – USA, DE

	ICO Holdings Australia Pty Ltd. - Australia

	ICO Holdings New Zealand Ltd. – New Zealand

	ICO Holland BV – The Netherlands

	ICO Italia Srl - Italy

	ICO Minerals, Inc. – USA, DE

	ICO Offshore – Cayman Islands

	ICO P&O, Inc. – USA, DE

	ICO Petrochemical Cayman Islands – Cayman Islands

	ICO Polymers do Brasil Ltda. - Brazil

	ICO Polymers France SAS - France

	ICO Polymers Hellas Ltd. - Greece

	ICO Polymers North America, Inc. – USA, NJ

	ICO Polymers UK Ltd. - UK

	ICO Polymers, Inc. – USA, DE

	ICO Scandinavia AB - Sweden

	ICO Technology, Inc. – USA, DE

	ICO UK Ltd. - UK

	ICO Worldwide, LP – USA, TX

	ICO Worldwide (UK), Ltd. - UK

	ICO Worldwide Tubular Services PTE Ltd. - Singapore

	Innovation Company, S.A. de C.V. - Mexico

	J.R. Courtenay (N.Z.) Ltd. – New Zealand

	J.R. Courtenay Sdn Bhd - Malaysia

	Rotec Chemicals, Ltd. - UK

	Lomic SCI - France

	Soreco SAS - France

	Swavasey Colours Ltd. - UK

	Tecron Industries Ltd. - UK

	Verplast Srl - Italy

	Wedco Minerais Ltda. - Brazil

	Wedco Petrochemical, Inc. – USA, DE

	Wedco Technology U.K. Ltd. - UK

	Wedco Technology, Inc. – USA, NJ

	Worldwide GP, LLC – USA, DE

	Worldwide LP, LLC – USA, DE









Page 17 of 17