Document:

Employment Agreement - George Gregory

 Exhibit 10.5 
  
 EMPLOYMENT AGREEMENT 
 GEORGE GREGORY 
  
 EMPLOYMENT AGREEMENT (the “Agreement”) dated as of November 1, 2004 by and between KRATON Polymers LLC, (“KRATON”), a Delaware limited liability company, which is a wholly owned subsidiary of Polymer Holdings LLC
(“Parent”), a Delaware limited liability company and George Gregory (the “Executive”), 
  
 In consideration of the premises and mutual covenants herein and for other good and valuable consideration, the parties agree as follows: 
  
 1. Term of Employment. Subject to the provisions of Section 7 of this
Agreement, Executive shall continue to be employed by the Company for a period commencing on July 1, 2004 (the “Effective Date”) and ending on the day before the third anniversary of the Effective Date (the “Employment Term”) on
the terms and subject to the conditions set forth in this Agreement; provided, however, that commencing with the third anniversary of the Effective Date and on each anniversary thereafter (each an “Extension Date”), the Employment Term
shall be automatically extended for an additional one year period, unless KRATON or Executive provides the other party hereto 30 days prior written notice before the next Extension Date that the Employment Term shall not be so extended. 

 
 2. Position. 
  
 a. During the Employment Term, Executive shall serve as President and Chief
Executive Officer of KRATON and will report to the Board of Directors of KRATON (the “Board”), In such position, Executive shall have the duties and authority commensurate with the position as shall be determined from time to time by the
Board. In addition, Executive shall serve as a member of the Board without additional compensation. 
  
 b. During the Employment Term, Executive will devote Executive’s full business time and best efforts to the performance of Executive’s duties
hereunder and will not engage in any other business, profession or occupation for compensation or otherwise which would conflict or interfere with the rendition of such services either directly or indirectly, without the prior written consent of the
Board; provided that nothing herein shall preclude Executive, subject to the prior approval of the Board, from accepting appointment to or continue to serve on any board of directors or trustees of any business corporation or any charitable
organization; provided in each case, and in the aggregate, that such activities do not conflict or interfere with the performance of Executive’s duties hereunder or conflict with Section 8. 
  
 3. Base Salary. During the Employment Term, the Company shall pay
Executive a base salary (the “Base Salary”) at the annual rate of $450,000, payable in regular installments in accordance with the Company’s usual payment practices. Executive shall be entitled to annual reviews and increases in
Executive’s Base Salary, if any, as may be determined in the sole discretion of the Board. 

 4. Incentive Compensation. 
  
 a. Annual Bonus. With respect to the first partial fiscal year and each full fiscal year during the Employment Term,
Executive shall be eligible to earn an annual bonus award (an “Annual Bonus”) equal to (i) up to seventy-five percent (75%) of Executive’s Base Salary (the “Target”) based upon the achievement of performance objectives
established by the Board, and (ii) up to 150% of the Target if such performance objectives are exceeded due to extraordinary performance, as determined by the Board, provided that, with respect to fiscal year 2004, Executive’s Annual Bonus will
not be less than $168,750. The Company intends to establish a deferred compensation plan, under which Executive may elect to defer, no later than July 1st (or such later date as is provided in the plan) of the year in which the affected Annual Bonus
is earned, up to 50% of such Annual Bonus which may be paid at a later date in shares or units through KRATON Management LLC. The terms and conditions of the deferred compensation plan shall be provided in a separate plan document, which will
provide, among other things, that the Board shall determine the value of the shares or units as applicable for purposes of the deferred compensation plan. 
  
 b. Restricted Unit Award. As soon as practicable after the date hereof, the Company shall grant Executive a restricted unit award with a current
notional value of $875,000 based on the value of membership units of TJ Chemical Holdings LLC, as determined by the Board. Each “Restricted Unit” will be the equivalent of one notional membership unit of TJ Chemical Holdings LLC. Executive
shall not have any beneficial ownership in the notional membership units underlying the Restricted Units and the grant of Restricted Units shall represent an unsecured promise to deliver membership units of TJ Chemical Holdings LLC (either directly
or through membership units of KRATON Management LLC) on a future date. Twenty percent of the Restricted Units shall vest on each anniversary of the grant date, provided that Executive remains employed with the Company through the applicable vesting
date. Except as provided in the next succeeding sentence, upon termination of employment for any reason all unvested Restricted Units shall immediately and automatically be forfeited. In the event of a Change in Control, if the Executive’s
employment is terminated without Cause or for Good Reason during the two year period immediately following the date of the Change in Control, all unvested Restricted Units shall become immediately vested. Distribution of membership units
representing the portion of vested Restricted Units shall occur as soon as practicable after the earlier of a Change in Control or termination of Executive’s employment, provided that following a Change in Control, unvested Restricted Units
shall remain outstanding and continue to vest as provided above until the Executive’s employment terminates. 
  
 5. Employee Benefits. 
  
 a. General. During the Employment Term, Executive shall be entitled to participate in the Company’s employee benefit plans, as amended from
time to time, (other than bonus, incentive or severance plans) as in effect from time to time (collectively “Employee Benefits”), on the same basis as those benefits are generally made available to other senior executives of the Company.

  
 b. Other. During the Employment Term, Executive shall
be eligible to participate in the equity incentive plans of the Company, its Parent and TJ Chemical Holdings LLC. 
  

 2 

 6. Business Expenses. During the Employment Term, reasonable business expenses incurred by
Executive in the performance of Executive’s duties hereunder shall be reimbursed by the Company in accordance with Company policies. 
  
 7. Termination. The Employment Term and Executive’s employment hereunder may be terminated by either party at any time and for any reason;
provided that Executive will be required to give KRATON at least 60 days advance written notice of any resignation of Executive’s employment. Notwithstanding any other provision of this Agreement, the provisions of this Section 7 shall
exclusively govern Executive’s rights upon termination of employment with the Company and its affiliates. 
  
 a. By KRATON For Cause or By Executive Resignation without Good Reason. 
  
 (i) The Employment Term and Executive’s employment hereunder may be terminated by KRATON for Cause (as
defined below) and shall terminate automatically upon Executive’s resignation without Good Reason (as defined below), provided that Executive will be required to give KRATON at least 60 days advance written notice of any such resignation, and
provided further that KRATON may elect to waive such notice period and to pay Executive in lieu of such notice. 
  
 (ii) For purposes of this Agreement “Cause” shall mean (A) Executive’s continued failure substantially to perform
Executive’s duties hereunder (other than as a result of total or partial incapacity due to physical or mental illness) for a period of 30 days following written notice by KRATON to Executive of such failure; provided that it is understood that
this clause (A) shall not permit KRATON to terminate Executive’s employment for Cause because of dissatisfaction with the quality of services provided by or disagreement with the actions taken by Executive in the good faith performance of
Executive’s duties to KRATON, (B) failure of Executive to maintain his principal residence in the same metropolitan area as KRATON’s principal headquarters, which is currently located in Houston, Texas, or elsewhere as mutually agreed to
by Executive and Company, (C) theft or embezzlement of Company property, (D) Executive’s conviction of or plea of guilty or no contest to (x) a felony or (y) a crime involving moral turpitude, (E) Executive’s willful malfeasance or willful
misconduct in connection with Executive’s duties hereunder or any act or omission which is materially injurious to the financial condition or business reputation of the Company or any of its subsidiaries or affiliates, or (F) Executive’s
breach of the provisions of Sections 9 or 10 of this Agreement. 
  
 (iii) If Executive’s employment is terminated by KRATON for Cause, or if Executive resigns without Good Reason, Executive shall be entitled to receive, within 30 days following such termination with respect to
(A)-(C) below and at such time, if any, as the Employee Benefits under (D) below become due in accordance with the applicable terms thereof: 
  
 (A) the Base Salary through the date of termination, to the extent not already paid; 
  

 3 

 (B) any Annual Bonus earned but unpaid as of the date of termination for any previously
completed fiscal year; 
  
 (C) reimbursement for
any unreimbursed business expenses properly incurred by Executive in accordance with KRATON policy prior to the date of Executive’s termination; and 
  
 (D) such vested Employee Benefits, if any, as to which Executive may be entitled under the employee benefit plans of the Company as
described in Section 5(a) (including, without limitation, any retirement benefits, medical, life insurance or disability benefits, accrued but unpaid vacation or other benefits Executive is entitled to pursuant to the terms of the applicable plans
then in effect (the amounts described in clauses (A) through (D) hereof being referred to as the “Accrued Obligations”). 
  
 Following such termination of Executive’s employment by KRATON for Cause or resignation by Executive without Good Reason, except as set forth in this
Section 7(a)(iii), Executive shall have no further rights to any compensation or any other benefits in the nature of severance or termination pay or in connection with the termination of his employment. 
  
 b. Disability or Death. 
  
 (i) The Employment Term and Executive’s employment
hereunder shall terminate upon Executive’s death and may be terminated by KRATON if Executive becomes physically or mentally incapacitated and is therefore unable for a period of six (6) consecutive months or for an aggregate of nine (9) months
in any twenty-four (24) consecutive month period to perform Executive’s duties (such incapacity is hereinafter referred to as “Disability”); provided that a termination on the basis of a Disability must occur within 90 days of the
date when Executive is subject to termination due to Disability. Any question as to the existence of the Disability of Executive as to which Executive and KRATON cannot agree shall be determined in writing by a qualified independent physician
mutually acceptable to Executive and KRATON. If Executive and KRATON cannot agree as to a qualified independent physician, each shall appoint such a physician and those two physicians shall select a third who shall make such determination in
writing. The determination of Disability made in writing to the Company and Executive shall be final and conclusive for all purposes of the Agreement. 
  
 (ii) Upon termination of Executive’s employment hereunder for either Disability or death, Executive or Executive’s estate (as
the case may be) shall be entitled to receive: 
  
 (A) at the times set forth in Section 7(a)(iii) hereof, the Accrued Obligations; 
  

 4 

 (B) a pro rata portion of any Annual Bonus that Executive would have been entitled to
receive pursuant to Section 4 hereof in such year based upon the percentage of the fiscal year that shall have elapsed through the date of Executive’s termination of employment, payable when such Annual Bonus would have otherwise been payable
had Executive’s employment not terminated. 
  
 Following
Executive’s termination of employment due to death or Disability, except as set forth in this Section 7(b)(ii), Executive shall have no further rights to any compensation or any other benefits in the nature of severance or termination pay or in
connection with the termination of his employment. 
  
 c. By
KRATON Without Cause or Resignation by Executive for Good Reason. 
  
 (i) The Employment Term and Executive’s employment hereunder may be terminated by KRATON without Cause or by Executive’s resignation for Good Reason. 
  
 (ii) If Executive’s employment is terminated by KRATON
without Cause (other than by reason of death or Disability) or by Executive’s resignation for Good Reason, Executive shall be entitled to receive: 
  
 (A) at the times set forth in Section 7(a)(iii) hereof, the Accrued Obligations; 
  
 (B) continuation of Executive’s annual Base Salary for
a period of 18 months following such termination (the “Severance Continuation Period”) which shall be paid at the same time and in the same manner as if Executive had remained employed by KRATON during such period; and 
  
 (C) medical benefits for Executive and his eligible
dependents comparable to those medical benefits Executive participated in on the date of termination during the Severance Continuation Period, provided in any case such medical benefits shall cease if Executive becomes entitled to medical benefits
from a new employer. KRATON may provide such medical benefits by paying the Executive’s COBRA continuation coverage through such Severance Continuation Period. 
  
 (iii) For purposes of this Agreement, “Good Reason” shall mean (A) the failure of the Company to
pay or cause to be paid Executive’s Base Salary or Annual Bonus (if any) when due, (B) a reduction in Executive’s Base Salary, the Target Annual Bonus opportunity described in Section 4 herein, or Employee Benefits other than an
across-the-board reduction in salary or bonus opportunity for all of the members of the Company’s management team and other than a 

  

 5 

 
decrease in Employee Benefits that applies to all employees otherwise eligible to participate in the affected plan, (C) a relocation of Executive’s
primary work location more than 50 miles from the work location on the date hereof, without written consent, or (D) a material reduction in Executive’s duties and responsibilities as described in Section 2(a) of this Agreement; provided that
none of these events shall constitute Good Reason unless the Company fails to cure such event within 30 days after receipt from Executive of written notice specifying in reasonable detail the event which constitutes Good Reason; provided, further,
that “Good Reason” shall cease to exist for an event on the 60th day following the later of its occurrence
or Executive’s knowledge thereof, unless Executive has given KRATON written notice thereof prior to such date. 
  
 The payments and benefits described in subparagraphs (B) - (C) above shall be subject to and conditioned upon the Executive’s execution and delivery
of a valid and effective general release and waiver, in a form satisfactory to the Company, waiving all claims the Executive may have against the Company, its affiliates and their respective executives, directors, partners, members, shareholders,
successors and assigns. Following Executive’s termination of employment by the Company without Cause (other than by reason of Executive’s death or Disability) or by Executive’s resignation for Good Reason, except as set forth in
Section 7(c)(ii), Executive shall have no further rights to any compensation or any other benefits in the nature of severance or termination pay or in connection with the termination of his employment. 
  
 d. Expiration of Employment Term. 
  
 (i) Election Not to Extend the Employment Term. In
the event either party elects not to extend the Employment Term pursuant to Section 1, unless Executive’s employment is earlier terminated pursuant to paragraphs (a), (b) or (c) of this Section 7, Executive’s termination of employment
hereunder (whether or not Executive continues as an employee of the Company thereafter) shall be deemed to occur on the close of business on the day immediately preceding the next scheduled Extension Date. If Executive’s employment is
terminated due to Executive’s election not to extend the Employment Term, Executive shall be entitled to receive the Accrued Obligations. If Executive’s employment is terminated by KRATON other than for Cause following KRATON’s
election not to extend the Employment Term, Executive shall be entitled to receive (1) at the times set forth in Section 7(a)(iii) hereof, the Accrued Obligations, (2) continuation of Executive’s annual Base Salary during the Severance
Continuation Period at the same time and in the same manner as if Executive had remained employed by KRATON during such period, and (3) medical benefits for Executive and his eligible dependents comparable to those medical benefits Executive
participated in on the date of termination during the Severance Continuation Period, provided in any case such medical benefits shall cease if Executive becomes entitled to medical benefits from a new employer. KRATON may provide such medical
benefits by paying the Executive’s COBRA continuation coverage through such Severance Continuation Period. 
  

 6 

 The payments and benefits described in this subparagraph (i) shall be subject to and
conditioned upon the Executive’s execution and delivery of a valid and effective general release and waiver, in a form satisfactory to the Company, waiving all claims the Executive may have against the Company, its affiliates and their
respective executives, directors, partners, members, shareholders, successors and assigns. Following such termination of Executive’s employment hereunder as a result either party’s election not to extend the Employment Term, except as set
forth in this Section 7(d)(i), Executive shall have no further rights to any compensation or any other benefits in the nature of severance or termination pay or in connection with the termination of his employment. 
  
 (ii) Continued Employment Beyond the Expiration of the
Employment Term. Unless the parties otherwise agree in writing, continuation of Executive’s employment with the Company beyond the expiration of the Employment Term shall be deemed an employment at-will and shall not be deemed to extend any
of the provisions of this Agreement and Executive’s employment may thereafter be terminated at will by either Executive or the Company; provided that the provisions of Sections 8, 9 and 10 of this Agreement (and the Company’s potential
severance obligation under Section 7(d)(i) if applicable) shall survive any termination of this Agreement or Executive’s termination of employment hereunder. 
  
 e. Notice of Termination. Any purported termination of employment by the Company or by Executive (other than due to
Executive’s death) shall be communicated by written Notice of Termination to the other party hereto in accordance with Section 1 l(h) hereof. For purposes of this Agreement, a “Notice of Termination” shall mean a notice which shall
indicate the specific termination provision in this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of employment under the provision so indicated. 
  
 f. Equity Investment. Notwithstanding anything herein to the
contrary, upon a termination of employment, the Executive shall have such rights and obligations with respect to any options to purchase membership units of TJ Chemical Holdings LLC (“TJ Chemical”) then held by the Executive and with
respect to Executive’s investment in TJ Chemical and/or KRATON Management LLC (including with respect to profits units and/or membership units, as applicable) in accordance with the applicable governing documents thereof. 
  
 8. Non-Competition. 
  
 a. Executive acknowledges and recognizes the highly competitive nature of
the businesses of the Company and accordingly agrees as follows: 
  
 (i) During the Employment Term and, for a period of one year following the date Executive ceases to be employed by the Company (the “Restricted Period”), Executive will not, whether on Executive’s own
behalf or on behalf of or in conjunction with any person, company, business entity or other 

  

 7 

 
organization engaged in a Competitive Business (as defined below), directly or indirectly solicit or assist in soliciting on behalf of any entity engaged in
a Competitive Business, the business of any client or prospective client: 
  
 (A) with whom Executive had personal contact or dealings on behalf of the Company during the one year period preceding Executive’s termination of employment; 
  
 (B) with whom employees reporting to Executive have had
personal contact or dealings on behalf of the Company during the one year period immediately preceding the Executive’s termination of employment; or 
  
 (C) for whom Executive had direct or indirect responsibility during the one year period immediately preceding Executive’s
termination of employment. 
  
 (ii) During the Restricted
Period, Executive will not directly or indirectly: 
  
 (A) engage in a Competitive Business; 
  
 (B) enter the employ of, or render any services to, any person or entity (or any division of any person or entity) who or which engages in a Competitive Business; provided that Executive shall not be prohibited from rendering any services
to any company that derives less than 10% of its revenues from a Competitive Business (a “Permitted Company”), if such services or employment relate solely to a business of the Company that is not in competition with a Competitive
Business; 
  
 (C) acquire a financial interest
in, or otherwise become actively involved with, any Competitive Business, directly or indirectly, as an individual, partner, shareholder, officer, director, principal, agent, trustee or consultant; provided, however, a Competitive Business shall not
include a Permitted Company; or 
  
 (D)
interfere with, or attempt to interfere with, business relationships (whether formed before, on or after the date of this Agreement) between the Company and customers, clients, suppliers partners, members or investors of the Company of which it is
reasonable to expect that Executive is aware. 
  
 (iii) For purposes of this Agreement, “Competitive Business” means the development, manufacture, license, sale or provision of products or services that the Company currently, or at any time during the Employment Term, sells,
manufactures, licenses or provides, or has specific plans to do so, including without limitation styrenic block copolymers made by anionic polymerization. 
  

 8 

 (iv) Notwithstanding anything to the contrary in this Agreement, Executive may, directly
or indirectly own, solely as an investment, securities of any person engaged in a Competitive Business which is publicly traded on a national or regional stock exchange or on the over-the-counter market if Executive (i) is not a controlling person
of, or a member of a group which controls, such person and (ii) does not, directly or indirectly, own 5% or more of any class of securities of such person. 
  
 (v) During the Restricted Period, Executive will not, whether on Executive’s own behalf or on behalf of or in conjunction with any
person, company, business entity or other organization whatsoever, directly or indirectly: 
  
 (A) solicit or encourage any employee of the Company to leave the employment of the Company; or 
  
 (B) hire any such employee who was employed by the Company
as of the date of Executive’s termination of employment with the Company or who left the employment of the Company coincident with, or within six months prior to or after, the termination of Executive’s employment with the Company.
Notwithstanding the foregoing, following a Change in Control, Executive will not be restricted from hiring any employee who is terminated without Cause following such Change in Control. 
  
 (vi) During the Restricted Period, Executive will not, directly or indirectly, solicit or encourage to cease
to work with the Company any individual consultant then under contract with the Company. 
  
 b. It is expressly understood and agreed that although Executive and the Company consider the restrictions contained in this Section 8 to be reasonable, if a final judicial determination is made by a court of
competent jurisdiction that the time or territory or any other restriction contained in this Agreement is an unenforceable restriction against Executive, the provisions of this Agreement shall not be rendered void but shall be deemed amended to
apply as to such maximum time and territory and to such maximum extent as such court may judicially determine or indicate to be enforceable. Alternatively, if any court of competent jurisdiction finds that any restriction contained in this Agreement
is unenforceable, and such restriction cannot be amended so as to make it enforceable, such finding shall not affect the enforceability of any of the other restrictions contained herein. 
  
 9. Confidentiality; Inventions. 
  
 a. Confidentiality. During the Employment Term and thereafter, Executive will not disclose or use for
Executive’s own benefit or purposes or the benefit or purposes of any other person, firm, partnership, joint venture, association, corporation or other business organization, entity or enterprise other than the Company, any trade secrets, or
other confidential information or data of the Company relating to the Company’s customers, development programs, costs, marketing, trading, investment, sales activities, promotion, credit 

  

 9 

 
and financial data, manufacturing processes, financing methods, plans, or the business and affairs of the Company generally; provided that the foregoing
shall not apply to information which is not unique to the Company or which is generally known to the industry or the public other than as a result of Executive’s breach of this covenant. Except as required by law, Executive will not disclose to
anyone, other than his immediate family, legal or financial advisors or any subsequent employer, the contents of this Agreement. Executive agrees that upon termination of Executive’s employment with the Company for any reason, he will return to
the Company immediately all memoranda, books, papers, plans, information, letters and other data, and all copies thereof or therefrom, in any way relating to the business of the Company, except that he may retain personal notes, notebooks and
diaries and personally owned books, reference material or information of a similar nature, that do not contain confidential information of the type described in the preceding sentence of this section. Executive further agrees that he will not retain
or use for Executive’s account at any time any trade names, trademark or other proprietary business designation used or owned in connection with the business of the Company. 
  
 b. Prior Inventions. Executive has attached hereto, as Exhibit A, a list describing all material creations,
inventions, and developments which were created or contributed to by Executive either solely or jointly with others prior to Executive’s employment with the Company which relate to the Company’ proposed or current business, services,
products or research and development (collectively referred to as “Prior Inventions”). If no such list is attached, Executive either will advise the Company that Prior Inventions exist but cannot be disclosed because of prior existing
confidentiality obligations or, absent such advice, will be understood to represent that there are no such Prior Inventions. If in the course of Executive’s employment with the Company, Executive uses or relies upon a Prior Invention, or any
works of authorship (including software, related items, data bases, documentation, site content, text or graphics), developments, improvements or trade secrets which were created or contributed to by Executive either solely or jointly with others
prior to Executive’s employment with the Company (“Prior Intellectual Property”) in Executive’s creation or contribution to any work of authorship, invention, product, service, process, machine or other property of the Company,
Executive will inform the Company promptly and, upon request, use Executive’s best efforts to procure any consents of third parties necessary for the Company’s use of such Prior Intellectual Property. To the fullest extent permissible by
law, and to the extent not in contravention of any prior legal obligation of Executive to others all of which are disclosed to KRATON on Exhibit B, attached hereto, Executive hereby grants the Company a non-exclusive royalty-free, irrevocable,
perpetual, worldwide license under all of Executive’s Prior Inventions to make, have made, copy, modify, distribute, use and sell works of authorship, products, services, processes and machines and to otherwise operate the Company’s
current and future business. 
  
 c. Ownership of
Inventions. Executive agrees that Executive will promptly make full written disclosure to the Company, and hereby assigns to the Company, or its designee, all of Executive’s right, title, and interest in and to any and all creations,
inventions or developments, whether or not patentable, which Executive may solely or jointly conceive or develop or reduce to practice, during the period of time Executive is in the employ of the Company (collectively referred to as “the
Company Inventions”), other than (and the Company Inventions shall not include) any such creations, inventions or developments which demonstrably bear no relationship whatsoever to the business of the Company, the chemical industry, or the
application of technologies, ideas, or processes directly or indirectly related to the business of the 
  

 10 

 
Company or the chemical industry to any other industries or disciplines. For the avoidance of doubt, the Company Inventions shall include any creations,
inventions or developments that relate directly or indirectly to a Competitive Business. Executive further acknowledges that all original works of authorship which are created or contributed to by Executive (solely or jointly with others) within the
scope of and during the period of Executive’s employment with the Company (“the Company Copyrights”) are to be deemed “works made for hire,” as that term is defined in the United States Copyright Act, and the copyright and
all intellectual property rights therein shall be the sole property of the Company. To the extent any of such works are deemed not to be “works made for hire,” Executive hereby assigns the copyright and all other intellectual property
rights in such works to the Company. 
  
 d. Contracts with the
United States. Executive agrees to execute any licenses or assignments of the Company Inventions or the Company Copyrights as required by any contract between the Company and the United States or any of its agencies. 
  
 e. Maintenance of Records. Executive agrees to keep and maintain
adequate and current written records of all the Company Inventions made by Executive (solely or jointly with others) during the term and within the scope of Executive’s employment with the Company. The records wilt be in the form of notes,
sketches, drawings, and any other format that may be specified to Executive or within the Company’s policies, manuals or procedures by the Company. The records will be available to and remain the sole property and intellectual property of the
Company at all times. 
  
 f. Further Assurances. Executive
covenants to take all requested actions and execute all requested documents to assist the Company, or its designee, at the Company’s expense, in every way; consistent with applicable law, (1) to secure the Company’s above rights in the
Prior Intellectual Property and Company Inventions and any of the Company’s Copyrights, patents, mask work rights or other intellectual property rights relating thereto in any and all countries, and (2) to pursue any patents or registrations
with respect thereto. This covenant shall survive the termination of this Agreement. If the Company is unable for any reason, after reasonable efforts, to secure Executive’s signature on any document for this purpose, then Executive hereby
irrevocably designates and appoints the Company and its duly authorized officers and agents as Executive’s agent and attorney in fact, for the limited purpose of acting for and in Executive’s behalf and stead to execute such documents and
to do all other lawfully permitted acts in connection with the execution of such documents. 
  
 10. Specific Performance. Executive acknowledges and agrees that the Company’s remedies at law for a breach or threatened breach of any of the provisions of Sections 8 through 10 would be inadequate and,
in recognition of this fact, Executive agrees that, in the event of such a breach or threatened breach, in addition to any remedies at law, the Company, without posting any bond, shall be entitled to obtain equitable relief in the form of specific
performance, temporary restraining order, temporary or permanent injunction or any other equitable remedy which may then be available and in the event of a breach of Sections 8 through 10, shall be entitled to cease making any payments or providing
any benefit otherwise required by this Agreement. 
  

 11 

 11. Miscellaneous. 
  
 a. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of
Delaware, without regard to conflicts of laws principles thereof. 
  
 b. Entire Agreement/Amendments. Except for the documents related to the Company and its affiliates’ equity incentive plans, this Agreement contains the entire understanding of the parties with respect to the employment of
Executive by the Company, there are no restrictions, agreements, promises, warranties, covenants or undertakings between the parties with respect to the subject matter herein other than those expressly set forth herein. This Agreement may not be
altered, modified, or amended except by written instrument signed by the parties hereto. 
  
 c. No Waiver. The failure of a party to insist upon strict adherence to any term of this Agreement on any occasion shall not be considered a waiver of such party’s rights or deprive such party of the right
thereafter to insist upon strict adherence to that term or any other term of this Agreement. 
  
 d. Severability. In the event that any one or more of the provisions of this Agreement shall be or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions of this Agreement shall not be affected thereby. 
  
 e. Assignment. This Agreement shall not be assignable by Executive. This Agreement may be assigned by the Company to a person or entity which is an affiliate or a successor in interest to substantially all of the business operations
of the Company. Upon such assignment, the rights and obligations of the Company hereunder shall become the rights and obligations of such affiliate or successor person or entity. 
  
 f. Set Off. The Company’s obligation to pay Executive the amounts provided and to make the arrangements
provided hereunder shall be subject to set-off, counterclaim or recoupment of amounts owed by Executive to the Company or its affiliates. 
  
 g. Successors; Binding Agreement. This Agreement shall inure to the benefit of and be binding upon personal or legal representatives, executors,
administrators, successors, heirs, distributes, devises and legatees. 
  
 h. Notice. For the purpose of this Agreement, notices and all other communications provided for in the Agreement shall be in writing and shall be deemed to have been duly given when delivered by hand or overnight courier or three
days after it has been mailed by United States registered mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth below Agreement, or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notice of change of address shall be effective only upon receipt. 
  

 12 

 If to the Company: 
  
 KRATON Polymers LLC 
 c/o Texas Pacific Group 
 301 Commerce Street, suite 3300 
 Fort Worth, Texas 76102 
  
 If to executive: 
  
 To the most recent address of Executive set forth in the personnel records of the Company. 
  
 i. Executive Representation. Executive hereby represents to the Company that the execution and delivery of this
Agreement by Executive and the Company and the performance by Executive of Executive’s duties hereunder shall not constitute a breach of, or otherwise contravene, the terms of any employment agreement or other agreement or policy to which
Executive is a party or otherwise bound. 
  
 j.
Cooperation. Executive shall at the Company’s expense provide his reasonable cooperation in connection with any action or proceeding (or any appeal from any action or proceeding) which relates to events occurring during Executive’s
employment hereunder. This provision shall survive any termination of this Agreement. 
  
 k. Withholding Taxes. The Company may withhold from any amounts payable under this Agreement such Federal, state and local taxes as may be required to be withheld pursuant to any applicable law or regulation.

  
 1. Counterparts. This Agreement may be signed in
counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. 
  
 m. Insurance. Notwithstanding anything to the contrary herein: 
  
 (i) All rights the Executive has to indemnification as a director, officer or fiduciary pursuant to any
agreement, applicable statue. Company by-laws or articles of organization as in effect from time to time shall not be impacted by the provisions of this Agreement and all such rights, if any, shall survive the termination and/or expiration of this
Agreement and/or the termination of the Executive’s employment with the Company; and 
  
 (ii) So long as the Executive is employed by the Company and for a period of six (6) years following the Executive’s termination of
employment, the Company agrees to purchase and maintain insurance for the Executive’s benefit, covering director, officer and fiduciary liability on the same basis as active directors, officers and/or fiduciaries, as applicable, of the Company.

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

 13 

					
	KRATON POLYMERS LLC	 	GEORGE GREGORY
			
	 	 	 /s/ Joseph J. Waiter

	 	 /s/ George Gregory

	By:	 	Joseph J. Waiter	 	 
	Title:	 	Vice President & General Counsel	 	 

  

 14Notional Unit Award Grant Agreement

 Exhibit 10.6 
  
 NOTIONAL UNIT AWARD GRANT AGREEMENT 
  
 THIS NOTIONAL UNIT AWARD GRANT AGREEMENT (this “Agreement”), made as of the 10th day of September, 2004 between KRATON Polymers LLC (the “Company”) and George Gregory (the
“Participant”). 
  
 WHEREAS, pursuant to Section
4.02 of the Second Amended and Restated Limited Liability Company Operating Agreement of TJ Chemical Holdings LLC (the “TJ Chemical Operating Agreement”), each of the Voting Members of TJ Chemical Holdings LLC (“TJ
Chemical”) has approved the grant of a Notional Unit award with a current notional value of $875,000 to the Participant pursuant to his employment agreement with the Company, dated July 1, 2004 (the “Employment Agreement”);

  
 NOW, THEREFORE, in consideration of the premises and the
mutual covenants hereinafter set forth, the parties hereto hereby agree as follows: 
  
 1. Grant of a Notional Unit Award. Pursuant to, and subject to, the terms and conditions set forth herein, the Company hereby grants to the Participant an award (the “Award”) of Notional Units
(“Notional Units”) with a current notional value of $875,000 based on the value of membership unit(s) of TJ Chemical. Each Notional Unit will be the equivalent of one notional membership unit of TJ Chemical. 
  
 2. Grant Date. The Grant Date of the Award hereby granted is September
10th, 2004. 
  
 3. No Beneficial Ownership. The Participant shall not have any beneficial ownership in the notional membership units underlying the Notional Units and the
grant of Notional Units shall represent an unsecured promise to deliver membership units of TJ Chemical (either directly or through membership units of KRATON Management LLC (“Management LLC”)) on a future date. 
  
 4. Vesting Date. The Award shall vest as follows: Twenty percent of the
Notional Units shall vest on each of the first five anniversaries of the Effective Date (as defined in the Employment Agreement), provided that the Participant remains employed with the Company through the applicable vesting date. Except as provided
in the next succeeding sentence, upon termination of employment for any reason all unvested Notional Units shall immediately and automatically be forfeited. In the event of a Change in Control (as defined in the TJ Chemical 2004 Option Plan), if the
Participant’s employment is terminated without Cause or for Good Reason (as those terms are defined in the Employment Agreement) during the two-year period immediately following the date of the Change in Control, all unvested Notional Units
shall become immediately vested. 
  
 5. Distribution of Membership
Units. Distribution of membership units representing the portion of vested Notional Units shall occur as soon as practicable after the earlier of a Change in Control or termination of the Participant’s employment, provided that
following a Change in 

  

 
Control, unvested Notional Units shall remain outstanding and continue to vest as provided above until the Participant’s employment terminates.

  
 6. Limitations on Transfer of Membership Units; Termination of
Employment. The Participant acknowledges that upon becoming a member of TJ Chemical or Management LLC, as applicable, the Participant will be subject to all the terms and conditions provided in the TJ Chemical Operating Agreement or the
Limited Liability Company Operating Agreement of KRATON Management LLC, as amended from time to time (the “Management LLC Operating Agreement”), (collectively, the “Operating Agreements” and each an
“Operating Agreement”), as applicable, including all transfer restrictions, tag-along and drag-along rights and call rights provided therein. 
  

7. Delays or Omissions. No delay or omission to exercise any right, power or remedy accruing to any party hereto upon any breach or default of any party
under this Agreement, shall impair any such right, power or remedy of such party nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of or in any similar breach or default thereafter occurring nor
shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of any party of any breach or
default under this Agreement, or any waiver on the part of any party or any provisions or conditions of this Agreement, shall be in writing and shall be effective only to the extent specifically set forth in such writing. 
  
 8. Limitation on Transfer of Notional Units. Except as set forth in this
Section 8, the Award shall be distributable only to the Participant. The Award shall not be assignable or transferable other than by will or by the laws of descent and distribution. Notwithstanding the foregoing, the Participant may request
authorization from the Company to assign his Award granted herein to a trust or custodianship, the beneficiaries of which may include only the Participant, the Participant’s spouse or the Participant’s lineal descendants (by blood or
adoption), and, if the Company grants such authorization, the Participant may assign his rights accordingly. In the event of any such assignment, such trust or custodianship shall be subject to all the restrictions, obligations, and responsibilities
as apply to the Participant under this Agreement and shall be entitled to all the rights of the Participant under this Agreement; provided that upon such assignment in accordance with this Section 8, all references in this Agreement shall be
deemed to be replaced by a reference to the transferee of the Award, except references to employment obligations or the termination thereof, which shall continue to be references to the Participant, including Sections 4 and 5. 
  
 9. Indemnification. The Participant agrees, to the fullest extent permitted by
law, to indemnify and hold harmless the Company, Management LLC and TJ Chemical and any member, director, officer, or employee thereof against any and all losses, liabilities, claims, damages, and expenses of any nature whatsoever (including
attorneys’ fees and disbursements, judgments, fines and amounts paid in settlement) (collectively, “Losses”) arising out of or based upon any breach or failure by the Participant to comply with his obligations made herein. This
Section 9 shall survive any termination or execution of this Agreement. 
  

 2 

 10. Representations. 
  
 10.1 Participant Representations. In addition to any representations made by the Participant in the applicable
Operating Agreement, the Participant hereby represents and warrants to the Company, Management LLC and TJ Chemical that: (a) the Participant is aware that the applicable Operating Agreements provide significant restrictions on the ability of a
Participant to sell, transfer, assign, mortgage, hypothecate, or otherwise encumber the membership units; (b) the Participant has duly executed and delivered this Agreement; and (c) the Participant’s authorization, execution, delivery, and
performance of this Agreement do not conflict with any other agreement or arrangement to which the Participant is a party or by which it is bound. 
  
 10.2 Truth of Representations and Warranties. The Participant represents and warrants that all of his representations set forth in Section
10.1 of this Agreement are true and correct as of the date hereof. 
  
 11.
Integration. This Agreement, and the other documents referred to herein or delivered pursuant hereto (including, without limitation, the Operating Agreements) which form a part hereof contain the entire understanding of the parties with
respect to its subject matter and there are no restrictions, agreements, promises, representations, warranties, covenants or undertakings with respect to the subject matter hereof other than those expressly set forth in such documents. This
Agreement and the Operating Agreements supersede all prior agreements and understandings between the parties with respect to its subject matter. 
  
 12. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute
one and the same instrument. 
  
 13. Governing Law. This Agreement
shall be governed by and construed and enforced in accordance with the laws of the State of Delaware without regard to the provisions thereof governing conflict of laws. 
  
 14. Participant Acknowledgment. The Participant hereby acknowledges receipt of a copy of the Operating Agreements. The
Participant hereby acknowledges that all decisions, determinations and interpretations of the Board of Directors of the Company in respect of this Agreement shall be final and conclusive. 
  
 [Remainder of page intentionally left blank.] 
  

 3 

 IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by its duly authorized
officer and said Participant has hereunto signed this Grant Agreement on his own behalf, thereby representing that he has carefully read and understands this Agreement and the Operating Agreements as of the day and year first written above.

  

			
	KRATON POLYMERS LLC
	
	/s/    JOSEPH J.
WAITER        
	By:	 	 
	 Title:
	 	 

  

			
	GEORGE GREGORY
	
	/s/    GEORGE
GREGORY        
		
	Address:	 	 238 N. Ranquil Path

	 	 	 The Woodlands, TX 77380

  

 4

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00082-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00082-of-00352.parquet"}]]