Document:

Exhibit 10.3

 

Exhibit 10.3

TRIANGLE CAPITAL CORPORATION

EXECUTIVE OFFICER

RESTRICTED SHARE AWARD AGREEMENT

     THIS RESTRICTED SHARE AWARD AGREEMENT (this “Agreement”) is made and entered into as of the
___day of                     , 20___(the “Grant Date”), between Triangle Capital Corporation, a Maryland
corporation (the “Company”), and                      (the “Employee”). Capitalized terms not otherwise
defined herein shall have the meaning ascribed to such terms in the Triangle Capital Corporation
Amended and Restated 2007 Equity Incentive Plan.

     WHEREAS, in accordance with an order of the Securities and Exchange Commission (“SEC”) dated
March 18, 2008 (Release No. 28196) granting certain exemptive relief to the Company regarding the
issuance of restricted stock under and in accordance with the Investment Company Act of 1940, as
amended (the “1940 Act”), as well as the approval of the Company’s Board of Directors (the “Board”)
on February 6, 2008 and the approval of Company’s stockholders on May 7, 2008, the Company has
adopted the Triangle Capital Corporation Amended and Restated 2007 Equity Incentive Plan (the
“Plan”), which permits the issuance of restricted shares of the Company’s common stock, par value
$0.001 per share (the “Common Stock”);

     WHEREAS, the Company and Employee entered into that certain employment agreement dated
                     (as may be amended from time to time, the “Employment Agreement”);

     WHEREAS, subject to and in accordance with the terms and conditions of this Agreement and the
Plan, the Company desires to grant to Employee, shares of Common Stock in connection with and as
consideration for Employee’s various services to and for the benefit of the Company.

     NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth and for other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound hereby, agree as follows:

1. Grant of Restricted Shares.

     (a) The Company hereby grants to the Employee an award (the “Award”) of ___ shares of
Common Stock of the Company (the “Shares” or the
“Restricted Shares”) on the terms and conditions
set forth in this Agreement and as otherwise provided in the Plan.

     (b) The Employee’s rights with respect to the Award shall remain forfeitable at all times
prior to the dates on which the restrictions shall lapse in accordance with the terms hereof.

2. Terms and Rights as a Stockholder.

     (a) Except as provided herein and subject to such other exceptions as may be determined by the
Board (or a committee thereof, composed solely of independent directors,

 

 

appointed by the Board to administer the Plan, the “Committee”) in its discretion, the
Restricted Shares granted herein shall vest in four (4) equal, annual installments commencing on
the first anniversary of the Grant Date (each such anniversary a “Vesting Date” and the period
between the Grant Date and the applicable Vesting Date is the “Restricted Period”).

     (b) The Employee shall have all rights of a stockholder with respect to the Restricted Shares,
including the right to receive dividends and the right to vote such Shares, subject to the
following restrictions:

	 	(i)	 	the Employee shall not be entitled to delivery of the stock
certificate for any Shares until the Vesting Date as to such Shares;
	 
	 	(ii)	 	none of the Restricted Shares may be sold, assigned,
transferred, pledged, hypothecated or otherwise encumbered or disposed of prior
to the applicable Vesting Date; and
	 
	 	(iii)	 	except as otherwise determined by the Board or the Committee
at or after the grant of the Award hereunder, any of the Restricted Shares as
to which the Restricted Period has not expired shall be forfeited, and all
rights of the Employee to such Shares shall terminate, without further
obligation on the part of the Company, unless the Employee remains in the
continuous employment of the Company or a Subsidiary for the entire Restricted
Period relating to such Restricted Shares, as the case may be.

     Any Shares, any other securities of the Company and any other property (except for cash
dividends) distributed with respect to the Restricted Shares shall be subject to the same
restrictions, terms and conditions as such Restricted Shares.

     (c) Notwithstanding the foregoing, the Restricted Period shall automatically terminate as to
all Restricted Shares awarded hereunder (as to which such Restricted Period has not previously
terminated) upon the occurrence of the following events:

	 	(i)	 	termination of the Employee’s employment with the Company or
any Subsidiary which results from the Employee’s death or Disability (as
defined in the Plan);
	 
	 	(ii)	 	the occurrence of a Change in Control (as defined in the Plan);
	 
	 	(iii)	 	termination of the Employee’s employment with the Company or
any Subsidiary for Good Reason (as such term is defined in the Employment
Agreement); or
	 
	 	(iv)	 	termination of the Employee’s employment with the Company or
any Subsidiary for any reason other than for “cause” (as such term is defined
in the Employment Agreement).

3. Termination of Restrictions. Upon the expiration or termination of the Restricted
Period as to any portion of the Restricted Shares, or at such earlier time as may be determined by
the

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Board or the Committee, all restrictions set forth in this Agreement or in the Plan relating to
such portion of the Restricted Shares shall lapse as to such portion of the Restricted Shares, and
a stock certificate for the appropriate number of Shares shall be delivered to the Employee or the
Employee’s beneficiary or estate, as the case may be, pursuant to the terms of this Agreement.

4. Delivery of Shares.

     (a) As of the date hereof, certificates representing the Restricted Shares shall be registered
in the name of the Employee and held by the Company or transferred to a custodian appointed by the
Company for the account of the Employee subject to the terms and conditions of the Plan and shall
remain in the custody of the Company or such custodian until their delivery to the Employee or
Employee’s beneficiary or estate as set forth in Section 4(b) and Section 4(c)
hereof or their reversion to the Company as set forth in Section 2(b) hereof.

     (b) Certificates representing Restricted Shares in respect of which the Restricted Period has
lapsed pursuant to this Agreement shall be delivered to the Employee as soon as practicable
following the date on which the restrictions on such Restricted Shares lapse.

     (c) Certificates representing Restricted Shares in respect of which the Restricted Period
lapsed upon the Employee’s death shall be delivered to the executors or administrators of the
Employee’s estate as soon as practicable following the receipt of proof of the Employee’s death
satisfactory to the Company.

     (d) Each certificate representing Restricted Shares shall bear a legend in substantially the
following form:

THIS CERTIFICATE AND THE SHARES OF STOCK REPRESENTED HEREBY ARE SUBJECT TO
THE TERMS AND CONDITIONS (INCLUDING FORFEITURE AND RESTRICTIONS AGAINST
TRANSFER) CONTAINED IN THE TRIANGLE CAPITAL CORPORATION AMENDED AND RESTATED
2007 EQUITY INCENTIVE PLAN (THE “PLAN”) AND THE RESTRICTED SHARE AWARD
AGREEMENT (THE “AGREEMENT”) BETWEEN THE OWNER OF THE RESTRICTED SHARES
REPRESENTED HEREBY AND TRIANGLE CAPITAL CORPORATION (THE “COMPANY”). THE
RELEASE OF SUCH SHARES FROM SUCH TERMS AND CONDITIONS SHALL BE MADE ONLY IN
ACCORDANCE WITH THE PROVISIONS OF THE PLAN AND THE AGREEMENT, COPIES OF
WHICH ARE ON FILE AT THE COMPANY.

5. Effect of Lapse of Restrictions. To the extent that the Restricted Period applicable to
any Restricted Shares shall have lapsed, the Employee may receive, hold, sell or otherwise dispose
of such Shares free and clear of the restrictions imposed under the Plan and this Agreement.

6. Adjustments. The Board (or the Committee) shall make equitable and proportionate
adjustments in the terms and conditions of, and the criteria included in, this Award in recognition
of unusual or nonrecurring events (including, without limitation, the events described in Section
4.5 of the Plan) affecting the Company, any Subsidiary or Affiliate, or the financial statements of

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the Company or any Subsidiary or Affiliate, or of changes in applicable laws, regulations, or
accounting principles, in order to prevent dilution or enlargement of the benefits or potential
benefits intended to be made available under the Plan.

7. Amendment to Award. Subject to the restrictions contained in the Plan, the Board or the
Committee may waive any conditions or rights under, amend any terms of, or alter, suspend,
discontinue, cancel or terminate, the Award, prospectively or retroactively; provided that any such
waiver, amendment, alteration, suspension, discontinuance, cancellation or termination which would
adversely affect the rights of the Employee or any holder or beneficiary of the Award shall not to
that extent be effective without the consent of the Employee, holder or beneficiary affected.

8. Taxes; Section 83(b) Election; Tax Consequences.

     (a) Employee shall be responsible for the timely payment of all taxes imposed upon Employee as
a result of the Award and vesting of the Restricted Shares, whether federal or state.

     (b) The Employee may, but is not required to, elect to apply the tax rules of Section 83(b) of
the Internal Revenue Code of 1986, as amended (the “Code”), to the issuance of the Restricted
Shares. If the Employee makes an affirmative election under Section 83(b) of the Code, the
Employee must notify the Company in writing within 30 days after making such election.

     (c) Neither the Company nor any Subsidiary makes any commitment or guarantee that any federal
or state tax treatment will apply or be available to the Employee under this Agreement.

9. Withholding of Taxes. Company shall have the right to (i) make deductions from the
number of Shares otherwise deliverable upon satisfaction of the conditions precedent under this
Restricted Share Agreement (and other amounts payable under this Restricted Share Agreement) in an
amount sufficient to satisfy withholding of any federal, state or local taxes required by law, or
(ii) take such other action as may be necessary or appropriate to satisfy any such tax withholding
obligations.

10. No Employment or Service Contract. Nothing in this Agreement shall confer upon
Employee any right to continue in the service of the Company (or any Subsidiary employing or
retaining Employee) for any period of time or interfere with or restrict in any way the rights of
the Company (or any Subsidiary employing or retaining Employee) or Employee, which rights are
hereby expressly reserved by each, to terminate the employee status of Employee at any time for any
reason whatsoever, with or without cause, subject to the provisions of any employment agreement
between the Company and Employee.

11. Plan Governs. The Employee hereby acknowledges receipt of a copy of the Plan and
agrees to be bound by all of the terms and provisions thereof. The terms of this Agreement are
governed by the terms of the Plan, and in the case of any inconsistency between the terms of this
Agreement and the terms of the Plan, the terms of the Plan shall govern.

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12. Severability. If any provision of this Agreement is, or becomes, or is deemed to be
invalid, illegal, or unenforceable in any jurisdiction or as to any Person or the Award, or would
disqualify the Plan or Award under any laws deemed applicable by the Board or the Committee, such
provision shall be construed or deemed amended to conform to the applicable laws, or, if it cannot
be construed or deemed amended without, in the determination of the Board or the Committee,
materially altering the intent of the Plan or the Award, such provision shall be stricken as to
such jurisdiction, Person or Award, and the remainder of the Plan and Award shall remain in full
force and effect.

13. Notices. Any notice required in connection with this Agreement shall be given in
writing and shall be deemed to have been given when delivered personally to the recipient, sent to
the recipient by reputable overnight courier service (charges prepaid) or telecopied to the
recipient at the following addresses or to such other address as either party may provide in
writing from time to time.

	 	 	 	 	 
	 

	 	To the Company:
	 	Triangle Capital Corporation
	 

	 	 	 	3600 Glenwood Avenue, Suite 104
	 

	 	 	 	Raleigh, North Carolina 27612
	 

	 	 	 	Attn: Garland S. Tucker III
	 
	 	 	 	 
	 

	 	To the Employee:
	 	The address then maintained with respect

 to the Employee in the Company’s records.

14. Governing Law. The validity, construction and effect of this Agreement shall be
determined in accordance with the laws of the State of Maryland without giving effect to conflicts
of laws principles.

15. Employee Undertaking. Employee hereby agrees to take whatever additional action and
execute whatever additional documents the Company may, in its judgment, deem necessary or advisable
in order to carry out or effect one or more of the obligations or restrictions imposed on either
Employee or the Shares pursuant to the express provisions of this Agreement.

16. Successors in Interest. This Agreement shall inure to the benefit of and be binding
upon any successor to the Company. This Agreement shall inure to the benefit of the Employee’s
legal representatives. All obligations imposed upon the Employee and all rights granted to the
Company under this Agreement shall be binding upon the Employee’s heirs, executors, administrators
and successors.

17. Resolution of Disputes. Any dispute or disagreement which may arise under, or as a
result of, or in any way related to, the interpretation, construction or application of this
Agreement shall be determined by the Board or the Committee. Any determination made hereunder
shall be final, binding and conclusive on the Employee and the Company for all purposes.

18. Counterparts. This Agreement may be executed in counterparts, each of which shall be
deemed to be an original, but all of which, when taken together, shall constitute one and the same
instrument.

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***Balance of Page Intentionally Blank — Signatures on Next Page***

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     IN WITNESS WHEREOF, the parties have caused this Restricted Share Award Agreement to be duly
executed effective as of the day and year first above written.

	 	 	 	 	 	 	 
	 	 	TRIANGLE CAPITAL CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Garland S. Tucker III	 	 
	 

	 	Title:
	 	Chief Executive Officer and President	 	 
	 
	 	 	 	 	 	 
	 	 	EMPLOYEE:	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Please Print	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Signature	 	 

7EX-10.2 EMPLOYMENT AGREEMENT DATED JAN. 1, 2006

 

Exhibit 10.2

EMPLOYMENT AGREEMENT

     EMPLOYMENT AGREEMENT made as of January 1, 2006, between SOUTHERN CONTAINER CORP., a Delaware
corporation having its principal place of business at 115 Engineers Road, Hauppauge, New York 11788
(“Southern” or “Employer”) and JAMES B. PORTER III, residing at 4 Seashell Lane,
Northport, New York 11768-1415 (“Executive”).

RECITALS

     1. Employer is the majority owner of Solvay Paperboard LLC, a Delaware limited liability
company (“Solvay”). Executive has been employed by Employer and Solvay for several years.

     2. Employer desires to continue to employ Executive in accordance with the terms and
conditions hereof, and Executive desires to continue to be so employed.

     ACCORDINGLY, intending to be legally bound, the parties hereto hereby agree as follows:

     1. Employment. Employer hereby employs Executive, and Executive agrees to serve, as
President of Employer, subject to the supervision and direction of the Board of Directors and
senior executive officers of Employer. Executive further agrees to serve as President of Solvay,
provided that Executive agrees that Article 4 hereof sets forth all of the compensation to be paid
to Executive for any services rendered in any capacity hereunder.

     2. Extent of Services. During the term hereof, Executive shall devote his best
efforts, and his full time, attention and energies to the performance of his duties hereunder and
to the performance of such other duties as may from time to time reasonably be assigned to him by
the Board of Directors and senior executive officers of Employer, and the Members of Solvay, and
shall not take part in any activity detrimental to Employer’s or Solvay’s interest. Except with the
prior written consent of Employer, Executive will not undertake or engage in any other employment,
occupation or business enterprise other than a business enterprise in which Executive does not
actively participate.

     3. Term. The term of Executive’s employment hereunder shall commence as of the date
hereof and continue until December 31, 2011, unless sooner terminated due to a Voluntary
Termination or by Employer with or without Gross Cause (the “Employment Period”). As used
in this Agreement, (x) “Voluntary Termination” means termination of Executive’s employment
hereunder due to Executive’s death, permanent disability, resignation (including a deemed
resignation under Section 3(a) hereof) or retirement; (y) “Gross Cause” means Executive’s
fraud, gross misconduct, gross negligence, disloyalty, gross insubordination, breach of trust,
breach of any material provision of this Agreement or of the Letter Agreement (as defined in
Article 7 below), and any other similar causes; and (z) “Cause” means that the Board of
Directors of Southern, by majority vote of its members, has determined that grounds exist to
terminate Executive’s employment due to his acts or omissions, but that such grounds do not
constitute Gross Cause as defined above. Executive acknowledges that the term of this Agreement is
not renewable and that his employment hereunder will not continue beyond December 31, 2011 (subject
to earlier termination as provided above).

     4. Compensation and Benefits.

          4.1 As used in this Article 4, (a) “Borrower”, “Term Loan A” and “Term
Loan B” have the meaning given such terms in the Amended and Restated Loan Agreement, dated as
of December 16, 2002, among Employer, Executive and Pamela S. Porter (as amended and restated from
time to time,

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the “Loan Agreement”); and (b) “South Carolina Loan” means that certain
$200,000 loan made by Employer to Executive and Pamela S. Porter on April 28, 2000.

          4.2 During the term of Executive’s employment hereunder, for all services to be rendered by
him in any capacity hereunder, Employer agrees to pay to Executive, and Executive agrees to accept,
the following:

               (a) a base salary at the following rates per calendar year, payable in accordance with
Employer’s customary payroll practices (the “Base Salary”):

	 	 	 	 	 
	Year	 	Salary
	2006
	 	$	468,000.00	 
	2007
	 	$	486,720.00	 
	2008
	 	$	506,189.00	 
	2009
	 	$	526,436.00	 
	2010
	 	$	547,494.00	 
	2011
	 	$	569,394.00;	 

               (b) provided Executive is employed by Employer for the entire fiscal year (except as otherwise
provided in Sections 4.7 and 4.8), a bonus (the “Bonus”) equal to one-half of one percent
(.5%) of the Net Income for such fiscal year. Subject to the provisions of Section 4.3, the Bonus
will be paid within the time bonus payments are made to Employer’s other senior management, if
practicable, but in no event later than one hundred twenty (120) days after the end of each fiscal
year, commencing with the fiscal year ended December 30, 2006; and

               (c) an additional bonus in an amount equal to any interest owed by Executive to Employer on
account of Term Loan A and the South Carolina Loan, payable at the time such interest is payable by
Executive to Employer; provided, however, that Employer will not be required to pay such bonus with
respect to any interest that becomes due after the principal of Term Loan A or the South Carolina
Loan, as the case may be, has become due, whether at maturity, by acceleration or otherwise.
Executive agrees to use such bonus to repay the interest on Term Loan A or the South Carolina Loan,
as the case may be, then due.

               (d) As used in this Agreement, “Net Income” means Employer’s consolidated annual net pre-tax
operating income. The Net Income shall be determined by the certified public accountants authorized
by the Board of Directors of Employer to audit its books. Such determination shall be made in
accordance with generally accepted accounting principles and practices, and shall, in all respects,
be binding and conclusive on the parties hereto. Without limiting the generality of the foregoing
sentence, in computing Net Income, all non-operating profits and losses (including, without
limiting the generality of the foregoing, LIFO inventory adjustments and gains or losses on the
sale or other disposition of capital assets or other Extraordinary Gains or Losses) shall be
disregarded.

          4.3 Notwithstanding anything to the contrary contained in this Agreement, commencing with the
first Bonus payable to Executive after Term Loan B has been paid in full, $100,000 of each Bonus
will be deferred until Term Loan A becomes due and payable under the Loan Agreement. When Term Loan
A becomes so due and payable, the deferred Bonus (net of any applicable withholding) will be paid
to Executive, and Borrowers will be obligated to repay Term Loan A, and all accrued interest
thereon, in full, regardless of whether the net amount of the deferred Bonus is sufficient to repay
such amount.

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               4.3.1 Employer and Executive acknowledge that $100,000 of the annual Bonuses payable to
Executive with respect to each of fiscal year 2000 and fiscal year 2001 have been deferred. When
the South Carolina Loan becomes due and payable, such deferred Bonus (net of any applicable
withholding) will be paid to Executive, and Borrower will be obligated to repay the South Carolina
Loan, and all accrued interest thereon, in full, regardless of whether the net amount of the
deferred Bonus is sufficient to repay such amount.

               4.3.2 Exhibit “C” hereto sets forth a summary of the outstanding balance of, and the payment
terms of, Term Loan A, Term Loan B and the South Carolina Loan.

          4.4 During the term of Executive’s employment hereunder, Executive shall be entitled to such
fringe benefits as shall be in effect from time to time with respect generally to Employer’s
full-time senior management.

          4.5 During each calendar year of his employment, Executive will be entitled to three (3) weeks
vacation (including personal days), or such longer period as Employer establishes, from time to
time, as its standard vacation period for its senior management, provided that such vacation does
not, in Southern’s reasonable discretion, unreasonably interfere with the operations of Southern or
Solvay.

          4.6 During the term of Executive’s employment hereunder, Employer will provide, for business
purposes, a country club membership for Executive of a category and in a club mutually approved by
Southern and Executive and located in the area of Employer, such approval not to be unreasonably
withheld by Southern; provided, however, that, in connection therewith, Employer shall not
be required to pay in any calendar year fees or other expenses in excess of the amount paid by
Employer during 2005. Executive acknowledges and understands that, under current law, if and to the
extent the club is used by Executive for non-business purposes, a proportionate amount of the
annual sum paid by Employer pursuant to this Section 4.6 will be includable by Executive in his
gross income for the year in which such sum was paid. Executive represents and warrants to
Employer that he uses the country club solely for business purposes, and agrees to indemnify
Employer for any tax liability incurred by Employer on account of providing such membership to
Executive.

          4.7 (a) If Executive’s employment hereunder is terminated due to Executive’s death or
permanent disability, or by Employer without Gross Cause, a pro-rated portion of the Bonus shall be
paid by Employer to Executive (or, in the event of Executive’s death prior to such payment, to such
beneficiary or beneficiaries as Executive shall have designated in a written notice filed with
Employer’s Secretary [the last such notice to govern] or, in the event no such designation shall
have been so filed, to Executive’s estate) at the time the Bonus would have been paid had
Executive’s employment continued for the full fiscal year in which it was terminated. The amount so
payable shall be determined by multiplying (i) the amount that would have been the Bonus had
Executive’s employment continued for the balance of the fiscal year in which it was terminated,
calculated as set forth above, by (ii) a fraction, the numerator of which shall be the total number
of days that elapsed in the calendar year prior to the date Executive’s employment terminated, and
the denominator of which shall be 365.

               (b) If the parties disagree as to whether Executive shall have suffered a permanent
disability, the dispute shall be resolved by a panel of three (3) medical doctors, one selected by
Employer, the second by Executive and the third by the two (2) medical doctors so selected. Such
arbitration shall be held in a location selected by Employer in Onondaga County or Suffolk County,
New York (as determined by where Executive is based at the time of the dispute), and conducted in
accordance with the Commercial Arbitration Rules of the American Arbitration Association then in
effect. The determination of the medical doctors shall be binding and conclusive upon Employer and
Executive, and the costs and expenses of such arbitration shall be borne equally by Executive and
Employer.

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          4.8 Notwithstanding anything to the contrary contained in this Agreement, Southern may
terminate Executive’s employment hereunder with or without Gross Cause. If Executive’s employment
hereunder is terminated by Employer other than for Gross Cause, or if, upon a Sale, the Successor
does not offer employment to Executive for a term of at least one year in a position, and with
compensation, benefits and duties substantially comparable to those in effect immediately prior to
the Sale, Employer shall pay to Executive, and Executive shall accept, as liquidated damages and
not as a penalty, an amount equal to twelve (12) months of Executive’s Base Salary, at the rate in
effect on the date of termination, payable at the times Executive’s salary would have been paid had
his employment continued for such twelve (12) month period (the “Severance Period”). In
addition, if Executive’s employment is terminated by Employer arbitrarily (i.e. other than for
Cause or Gross Cause), (i) Employer shall pay to Executive the Bonus Executive would have been
entitled to with respect to the Severance Period, payable at the times such Bonus would have been
paid had his employment continued for the Severance Period, and (ii) the ESU Agreement will remain
in place as if Executive was employed throughout the entire Severance Period, and payment
thereunder will be made as if Executive’s employment was terminated by Employer without Gross Cause
on the last day of the Severance Period. Such severance payment shall be in addition to any sums
due Executive in accordance with Subsection 4.2.2 of the ESU Agreement. Payments to Executive
pursuant to this Section 4.8 will be subject to the law of the State of New York (whether statutory
or otherwise) with respect to mitigation of damages by an employee upon the breach of his
employment agreement by his employer, as the same may exist as of the date hereof. Capitalized
terms used in this Section 4.8 and not otherwise defined in this Agreement are used as defined in
Exhibit “A” hereto.

     5. Expenses. Employer shall reimburse Executive for all out-of-pocket business
expenses (including, without limitation, gasoline, tolls and parking), incurred by him in the
performance of his duties hereunder (and deemed, by Employer, in its sole discretion, to be
reasonable arid necessary); provided that each such expenditure: (i) is of a nature qualifying it
as a proper deduction on Employer’s Federal and State income tax returns and (ii) is supported by
such records and other documentary evidence as Employer shall require.

     6. Automobile. During the term of Executive’s employment hereunder, Employer will give
Executive an automobile allowance of $1,000.00 per month, to compensate Executive for the business
use of his own car, such allowance to be in addition to reimbursement of gasoline, toll and parking
expenses as provided in Article 5, above. Executive will obtain and maintain during the term
hereof, automobile liability insurance for injury to person and property in the following amounts:
(a) $100,000 per person; and (b) $300,000 per incident, or such higher amounts as may be required
by law. Executive will include each of Southern and Solvay as an insured under such policy and will
deliver to Southern a certificate of such policy upon request.

     7. Restrictive Covenant, Non-Solicitation and Confidentiality. Concurrently herewith,
Executive is executing an agreement containing certain provisions with respect to competition by
Executive, his solicitation of Employer’s and Solvay’s customers and employees, arid his obligation
not to disclose confidential matters (the “Letter Agreement”). As a condition to the
receipt of payments hereunder, Executive agrees that, in addition to and without limiting the
continuing effectiveness of the Letter Agreement so long as he shall be bound thereby, the
provisions of the Letter Agreement shall be deemed incorporated in this Agreement by reference as
though fully set forth herein and he shall comply therewith throughout the term of his employment
hereunder and after termination thereof so long as the Letter Agreement remains in effect.

     8. Executive Not to Bind Employer. Executive does not have and will not hold himself
out as having any right, power or authority to create any contract or obligation (other than
purchases and sales

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in the ordinary course of business and consistent with Employer’s policies as in effect from
time to time or otherwise consistent with Employer’s past practice), express or implied, on behalf
of, in the name of, or binding upon, Southern or Solvay, to pledge either of its credit, or to
extend credit in either of its names (other than in connection with such permitted purchases and
sales), without such party’s specific, prior consent in writing.

     9. Sale of Southern. Capitalized terms used in this Article 9 and not otherwise
defined in this Agreement are used as defined in Exhibit “A” hereto. If there is a Sale during the
term of Executive’s employment hereunder, Southern will pay to Executive Executive’s Share within
thirty (30) days thereafter, provided that, if, as a condition to such Sale, the Successor requires
that Executive remain in the Successor’s employ for a period of up to twelve (12) months (the
“Continuation Period”), in the county of Kings, Queens, Nassau, New York or Suffolk, New
York, and in a position, and with compensation, duties and other terms of employment substantially
comparable to those in effect immediately prior to the Sale, and (x) Executive fails or refuses to
accept such employment, for any reason whatsoever, or (y) Executive accepts such employment but
during the Continuation Period terminates his employment (other than due to his death or permanent
disability) or is terminated by the Successor for Gross Cause, then Southern will not be obligated
to pay Executive’s Share to Executive and he will forfeit his right thereto. If the Successor so
requires that Executive remain in its employ and Executive accepts such employment, Southern will
pay Executive’s Share to Executive within 30 days after the earlier of (i) Executive’s death,
permanent disability or termination by the Successor without Gross Cause, and (ii) the completion
of the Continuation Period. All computations required to be made pursuant to Exhibit “A” will be
made by Southern’s Chief Financial Officer in accordance with generally accepted accounting
principles, consistently applied. Exhibit “B” hereto will set forth an example of the computation
of the Executive’s Share.

     10. Executive’s Warranty and Representation. Executive warrants and represents that he
has the full right and power to enter into and perform this Agreement and that the same does not
conflict with any contract, commitment or arrangement to which he is or was a party or by which he
is or was bound.

     11. Indemnity. Each of the parties hereby agrees to indemnify and hold each other
harmless from and against any and all claims, liabilities, losses, costs, and expenses (including
reasonable fees of counsel) resulting from or arising out of the breach of any of the
representations, warranties, covenants or agreements made by the indemnifying party hereunder.

     12. Consents, etc. to be in Writing. Wherever, in this Agreement, reference is made to
the acknowledgment, agreement, approval, consent, determination, election or request by a party or
parties hereto, the same must be in writing.

     13. General Provisions.

          13.1 Notices. All notices given hereunder shall be in writing and shall be sent by
certified mail, return receipt requested, or by recognized overnight courier, addressed to the
respective party at its or his address set forth above or at such other address or to such designee
as such party shall designate by a notice given in the manner herein provided. Each such notice
shall be deemed to be given on the date mailed or so deposited with the courier.

          13.2 Assignment. Executive may not assign this Agreement or any of his rights or
obligations hereunder.

          13.3 Invalid Provisions. If any provision of this Agreement or the application thereof
to any party or circumstance shall be held invalid or unenforceable to any extent, the remainder of
this

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Agreement and the application of such provision to such party or circumstance shall not be
affected thereby and shall be enforced to the greatest extent permitted by applicable law.

          13.4 Entire Agreement; Waiver; Remedies; Etc. This Agreement (with the ESU Agreement
and the Letter Agreement) constitutes the entire agreement between the parties concerning the
subject matter hereof and there are no agreements or representations with respect thereto except as
contained herein; supersedes any other or prior employment or compensatory agreement between the
parties (other than the ESU Agreement and the Letter Agreement); and may not be amended, modified
or renewed, nor may any of the provisions hereof be waived, except by a writing signed by the
parties hereto. A waiver by any party of any of the terms or conditions of this Agreement, or any
breach thereof, will not be deemed a waiver of such term or condition for the future, or of any
other term or condition, or of any subsequent breach thereof. All rights and remedies by this
Agreement reserved to Southern and Solvay shall be cumulative and shall not be in limitation of any
other right or remedy that such parties may have at law, in equity or otherwise.

          13.5 Binding Effect. This Agreement will be binding upon the parties hereto and their
respective personal representatives, successors and permitted assigns. In the event of (a) a merger
where Employer is not the surviving entity; (b) a consolidation of Employer with another entity; or
(c) a transfer of all or substantially all of the assets of Employer, the surviving or consolidated
entity, or in the event of a transfer of Employer’s assets, the transferee of Employer’s assets,
will have the benefit of and be bound by the provisions of this Agreement.

          13.6 Governing Law; Jurisdiction. This Agreement shall be governed by the laws of the
State of New York, without giving effect to the principles of conflicts of laws thereof, as to all
matters, including, but not limited to, matters of validity, construction, effect, performance and
remedies. Any action or proceeding seeking to enforce any provision of, or based on any right
arising out of, this Agreement may be brought against any of the parties in the courts of the State
of New York, or, if it has or can acquire jurisdiction, in the United States District Court for the
Eastern District of New York, and each of the parties consents to the jurisdiction of such courts
(and of the appropriate appellate courts) in any such action or proceeding and waives any objection
to venue laid therein. Process in any action or proceeding referred to in the preceding sentence
may be served on any party anywhere in the world.

          13.7 Descriptive Headings. The Article and Section headings contained in this
Agreement are solely for the purpose of reference, are not part of the agreement of the parties and
shall not affect in any way the meaning or interpretation of this Agreement.

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

	 	 	 	 	 	 	 
	 	 	SOUTHERN CONTAINER CORP.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Steven Grossman	 	 
	 

	 	Title:
	 	Chief Executive Officer	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ James B. Porter III	 	 
	 	 	James B. Porter III	 	 

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EXHIBIT “A”

     “Accumulated Earnings Share” has the meaning given such term in the ESU Agreement,
provided that, for the purposes of this Exhibit: (a) the reference in the definition of such term
to “as of a Termination Event” shall be a reference to “as of the closing of a Sale”; and (b) the
Solvay Accumulated Earnings Share Amount (as defined in the ESU Agreement) shall be subtracted from
the Accumulated Earnings Share.

     “Adjusted Purchase Price” means an amount determined by applying the following
formula: the Purchase Price + (Solvay’s Funded Debt for the fiscal year preceding the fiscal year
in which the Sale occurred x the Applicable Percentage) + Southern’s Funded Debt for the fiscal
year preceding the fiscal year in which the Sale occurred.

     “Applicable Percentage” means, on a given date, the percentage of Solvay’s membership
interests that are owned, directly or indirectly, by Southern.

     “Beginning Value” means an amount determined by applying the following formula:
([(Solvay’s 2000 EBITDA x the Applicable Percentage) + the average of Southern’s 1999 and 2000
EBITDA] x the Ratio) — [(Solvay’s 2000 Funded Debt x the Applicable Percentage) + the average of
Southern’s 1999 and 2000 Funded Debt].

     “EBITDA” means, for the fiscal year in question, Southern’s or Solvay’s, as the case
may be, earnings before interest, taxes, depreciation and amortization.

     “ESU Agreement” means the Earnings Share Units Agreement, dated as of January 1, 2001,
between Southern and Executive, as the same may be amended, modified and restated from time to
time.

     “Executive’s Share” means an amount determined by applying the following formula:
[(Net Purchase Price — Beginning Value) x 1%] — Accumulated Earnings Share.

     “Funded Debt” means, with respect to any fiscal year, all indebtedness having a
maturity of more than one year, computed as of the end of such fiscal year.

     “Grossman Family Members” means Steven and Robert Grossman, members of their immediate
families, Trustees under Trust(s) for the benefit of any of them, and the personal representatives
of any of the foregoing.

     “Net Purchase Price” means the net price payable to Southern (if the Sale is an asset
sale) or to the shareholders of Southern (if the Sale is a stock sale) in connection with a Sale
after deducting all costs and expenses of the Sale, including legal, accounting, and brokerage
fees. If and to the extent the consideration therefor is payable other than in cash, the purchase
price will be the fair market value of such non-cash consideration.

     “Ratio” means an amount (rounded to four decimal places) determined by applying the
following formula: the Adjusted Purchase Price / [(the average of Solvay’s EBITDA for the two
fiscal years preceding the fiscal year in which the Sale occurred x the Applicable Percentage) +
the average of Southern’s EBITDA for the two fiscal years preceding the fiscal year in which the
Sale occurred].

     “Sale” means any event as a result of which Grossman Family Members do not own or
otherwise control, directly or indirectly, at least 50% of the ownership interests in Southern or
in any entity that succeeds to all or substantially all of the assets of Southern.

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     “Successor” means (i) if Southern transfers all or substantially all of its assets,
the entity acquiring such assets, (ii) if Southern mergers (and is not the surviving entity) or
consolidates with another entity, such other entity, and (iii) if the Change of Control occurs due
to a transfer of ownership interests by Grossman Family Members, Southern.

     Note: All years referred to in this Exhibit “A” are fiscal years; Southern’s EBITDA and Funded
Debt shall be determined without regard to Solvay; and in computing Southern’s EBITDA and Funded
Debt, Southern’s investment in and all debt attributable to its Devens, Massachusetts facility
prior to start-up of such facility is to be disregarded until such time as that facility has been
in commercial operation for a period of at least ten months.

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EXHIBIT “B”

EXAMPLE OF COMPUTATION OF EXECUTIVE’S SHARE

	 	 	 	 	 	 	 	 	 	 	 	 	 
	Company	 	Year	 	EBITDA	 	Funded Debt
	SCC (without Solvay)
	 	 	1999	 	 	 	22,000	 	 	 	50,000	 
	 
	 	 	2000	 	 	 	16,000	 	 	 	60,000	 
	 
	 	 	2001	 	 	 	22,000	 	 	 	75,000	 
	 
	 	 	2002	 	 	 	28,000	 	 	 	72,000	 
	 
	 	 	2003	 	 	 	25,000	 	 	 	20,000	 
	 
	 	 	2004	 	 	 	30,000	 	 	 	17,000	 
	 
	 	 	2005	 	 	 	16,000	 	 	 	0	 
	* Note: Devens debt does not count until it is in
operation.
	 	 	 	 	 	 	 	 	 	 	 	 
	12/31/2000 adjustment (85,000 less: Devens
25,000)
	 	 	 	 	 	 	 	 	 	 	 	 
	Solvay
	 	 	2000	 	 	 	75,000	 	 	 	125,000	 
	 
	 	 	2001	 	 	 	50,000	 	 	 	125,000	 
	 
	 	 	2002	 	 	 	60,000	 	 	 	200,000	 
	 
	 	 	2003	 	 	 	65,000	 	 	 	206,000	 
	 
	 	 	2004	 	 	 	69,000	 	 	 	207,000	 
	 
	 	 	2005	 	 	 	71,000	 	 	 	193,000	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Consolidated: (100% SCC + 75% Solvay)
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	2000	 	 	 	72,250	 	 	 	153,750	 
	 
	 	 	2001	 	 	 	59,500	 	 	 	168,750	 
	 
	 	 	2002	 	 	 	73,000	 	 	 	222,000	 
	 
	 	 	2003	 	 	 	73,750	 	 	 	174,500	 
	 
	 	 	2004	 	 	 	81,750	 	 	 	172,250	 
	 
	 	 	2005	 	 	 	69,250	 	 	 	144,750	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Last 2 yr average:
	 	 	 	 	 	 	75,500	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Net Purchase Price
	 	 	 	 	 	 	500,000	 	 	 	 	 
	Funded Debt
	 	 	 	 	 	 	147,750	 	 	 	 	 
	Adjusted Sales Price
	 	 	 	 	 	 	644,750	 	 	 	 	 
	Divided by 2 yr avg EBITDA
	 	 	 	 	 	 	8.54	 	 	the “RATIO”
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Beginning Measurement
	 	 	 	 	 	 	 	 	 	 	 	 
	SCC Average EBITDA 1999/2000
	 	 	 	 	 	 	19,000	 	 	 	 	 
	SCC Average Funded Debt 1999/2000
	 	 	 	 	 	 	55,000	 	 	 	 	 
	SCC (avg 99/2000) + 75% Solvay 2000
	 	EBITDA	 	 	75,250	 	 	 	 	 
	SCC (avg 99/2000) + 75% Solvay Debt
	 	Funded Debt	 	148,750	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	EBITDA times the RATIO
	 	 	 	 	 	 	642,615	 	 	 	 	 
	less: Funded Debt
	 	 	 	 	 	 	148,750	 	 	 	 	 
	Beginning Value
	 	 	 	 	 	 	493,865	 	 	 	 	 

	 	 	 	 	 
	Executive’s Share of Sales Proceeds:
	 	 	 	 
	Net Purchase Price
	 	$	500,000	 
	Less: Beginning Value
	 	$	493,865	 
	Net Increase
	 	$	6,135	 
	Times
	 	 	1	%
	Executive’s Share
	 	$	61	 
	Less: Growth in ESU Account 2000-2005
	 	$	2,181	 
	 
	 	 	 	 
	Executive’s Share of Sales Proceeds:
	 	$	0	 

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EXHIBIT “C”

LOAN DETAILS

South Carolina Loan:

	 	 	 	 	 
	Balance Outstanding at 12/31/2005:
	 	$	200,000	 
	 
	 	 	 

Notes:

	 	1.	 	$200,000 already deferred from prior bonuses.
	 
	 	2.	 	Is charged imputed interest, which is also added to his bonus,
resulting in a wash (no cost) to both SCC and JP.
	 
	 	3.	 	Loan comes due at earliest of 2014, or certain events, such
as one year after termination, at which time the $200,000 deferred bonus will be paid, net of
taxes.

Term Loan “A”

	 	 	 	 	 
	Balance Outstanding at 12/31/05:
	 	$	300,000	 
	 
	 	 	 

Notes:

	 	1.	 	$100,000 per year (anticipated to begin in 2011) will be deferred
from bonus payments.
	 
	 	2.	 	Is charged imputed interest, which is also added to his bonus,
resulting in a wash (no cost) to both SCC and JP.
	 
	 	3.	 	Loan comes due at earliest of 2014, or certain events, such
as one year after termination.

Term Loan “B”

	 	 	 	 	 	 	 	 	 
	Original Balance:
	 	 	 	 	 	$	500,000	 
	Payment — deduction from 2002 Bonus
	 	$	(65,000	)	 	 	 	 
	Payment — deduction from 2003 Bonus
	 	$	(65,000	)	 	 	 	 
	Payment — deduction from 2004 Bonus
	 	$	(65,000	)	 	$	(195,000	)
	 
	 	 	 	 	 	 
	Balance Outstanding at 12/31/05:
	 	 	 	 	 	$	305,000	 
	 
	 	 	 	 	 	 	 

Notes:

	 	1.	 	Loan effective date: 8/12/02.
	 
	 	2.	 	$500,000 loan payable in seven annual installments of $65,000 and a final $45,000 installment.
	 
	 	3.	 	Per above, $195,000 has been deducted from annual bonuses as
installment payments.
	 
	 	4.	 	Interest is charged annually on the outstanding balance, based SCC’s
average cost of funds for the year.
	 
	 	5.	 	The unpaid balance of the loan comes due at the earliest of certain events such as one year
after termination, except if for gross cause or voluntary termination (comes due 90 days
after termination).

See Amended and Restated Loan Agreement, dated as of December 16, 2002, among Employer, Executive
and Pamela S. Porter and promissory notes evidencing the above loans for a complete description of
the terms thereof.

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