<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM 8-K/A
AMENDMENT TO
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of
earliest event reported): March 31, 1996
THE FRESH JUICE COMPANY, INC.
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(Exact name of registrant as specified in charter)
Delaware 0-15320 11-2771046
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(State or other (Commission file (IRS employer
jurisdiction of number) identification no.)
incorporation)
35 Walnut Avenue, Suite 4, Clark, New Jersey 07066
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (732) 396-1112
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Item 5. Other Events.
This Form 8-K/A is being filed as an amendment to a Current
Report on Form 8-K previously filed by The Fresh Juice Company, Inc. (the
"Company") on April 11, 1996 which reported on, among other items, the merger
of the Company and The Ultimate Juice Company, Inc. on March 31, 1996 (the
"April 1996 Form 8-K). This amendment is being filed for the sole purpose of
correcting an exhibit filed with the April 1996 Form 8-K. Through
inadvertance, the April 1996 Form 8-K filed by the Company included as Exhibit
10(d) a draft of the Company's employment agreement with Steven Smith. The
final version of that employment agreement was not filed as an exhibit to the
April 1996 Form 8-K.
This amendment is intended to correct that error and file the final
employment agreement between the Company and Steven Smith, as executed, as
Exhibit 10(d).
Item 7. Financial Statements and Exhibits.
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
<S> <C>
10(d) Employment Agreement dated March 31, 1996
with Steven Smith
</TABLE>
2
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SIGNATURE
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF
1934, THE REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY
THE UNDERSIGNED THEREUNTO DULY AUTHORIZED.
THE FRESH JUICE COMPANY, INC.
By: /s/ Steven M. Bogen
-------------------------------------------------
Steven M. Bogen, Chief Executive Officer
Dated: January 6, 1998
3
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
<S> <C>
10(d) Employment Agreement dated March 31, 1996
with Steven Smith
</TABLE>
4
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EMPLOYMENT AGREEMENT
AGREEMENT made this 31st day of March, 1996 by and between
Steven Smith residing at Five Lawson Lane, Great Neck, New York 11023 (the
"Employee") and The Fresh Juice Company, Inc., a Delaware corporation whose
address is 350 Northern Boulevard, Great Neck, NY 11021 (the "Employer").
WITNESSETH:
WHEREAS, Smith is presently employed as the President, Chief
Executive Officer and general manager of the Employer, pursuant to that certain
Employment Agreement dated October 5, 1986 between the Employee and the
Employer as amended by Employment Agreement between the Employee and Employer
dated August 17, 1994 (together, the "Old Employment Agreement"); and
WHEREAS, it has been agreed between the Employee and Employer
that they desire to amend and supersede the terms and conditions of the
Employee's employment with the Employer as set forth in the Old Employment
Agreement and enter into this new employment agreement pursuant to which, among
other things, the Employee will no longer serve as the Employer's Chief
Executive Officer and general manager, but shall continue to be employed as the
Employer's President, Assistant Secretary and Co-Chairman of the Board upon the
terms and conditions set forth herein.
NOW, THEREFORE AND in consideration of the premises and mutual
covenants herein contained, it is agreed between the Employee and the Employer
as follows:
1. Employment. (a) The Employer hereby agrees to
employ the Employee for the term of this Agreement, commencing as of the date
hereof, as the President, Assistant
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Secretary and Co-Chairman of the Board. The Employee also agrees to serve as a
director of the Employer and any direct or indirect Subsidiary thereof, if
elected.
2. Duties. (a) The Employee shall perform the duties
and functions customarily incident to the position of President, Assistant
Secretary and Co-Chairman of the Board of a corporation, and such other duties
incidental thereto and consistent therewith as may, from time to time be
assigned to him by the Board of Directors. As the President of the Employer
the Employee shall, subject to the directives of the Board of Directors, have
such powers and duties as the Board of Directors of the Company shall assign or
vest in him at any time and from time to time; it being understood that the
Employee shall exercise such powers and perform such duties commensurate with
such position and consistent with the powers and duties normally associated
with such position and title at comparable publicly-held companies, including,
but not limited to, the power to execute checks on behalf of the Employer and
its Subsidiaries provided, however, that the powers and duties of the Employee
hereunder or otherwise in connection with the operations of the Employer shall
be subordinate to and shall not be in contravention of the powers, duties and
directives of the Employer's Chief Executive Officer.
(b) The Employee's services hereunder may be rendered at
the Employer's principal executive offices in New Jersey, the offices of the
Employer's Subsidiaries in Florida or such other place as the parties may agree
to at any time and from time to time or such other location as the Employee
shall be fully capable of performing his duties and obligations hereunder. It
is understood and agreed, however, that during the term the Employee's duties
may require reasonable periods of travel from time to time as the Employer may
reasonably request.
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3. Other Business Interests. The Employee agrees,
during the term of this Agreement, to use his best efforts to promote the
interests and welfare of the Employer and to devote such time to his employment
as shall be necessary to enable him properly to perform his duties hereunder.
The Employee further agrees that unless otherwise approved by the Board of
Directors of the Company, the Employee shall work a minimum of 1,000 hours per
year. Notwithstanding the foregoing, however, the Employer acknowledges and
understands that the Employee has or may have other business interests and is
or may become an officer and director of other corporations and that the
Employee will be required to devote some portion of his time to his other
business interests. The Employer agrees that the Employee may so do, and that
he may be an officer and director of the corporations in which the Employee has
or may in the future obtain an interest. The Employer acknowledges that any
services performed by the Employee for such other business entities in which he
has or may obtain an interest, may occupy a significant portion of the
Employee's business time and will be rendered at such times and in such manner
as the Employee shall deem appropriate so long as same does not unreasonably
interfere with the performance of his duties and obligations to the Employer.
Under no circumstances shall the rendering of any services to such other
business entities form the basis for any breach by the Employee of his duties
and obligations hereunder or a basis for the termination by the Employer of the
Employee's employment hereunder so long as the Employee is in compliance with
his obligations to the Employer hereunder.
4. Salary. The Employee shall be paid, as base
compensation for the services rendered by him to the Employer, a salary in the
amount of $360,000 per annum (the "annual base compensation"), payable weekly
or in such other manner as shall be determined by the
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Employer, plus an annual bonus, which bonus, if any, shall be determined by the
Board of Directors.
The annual base compensation of the Employee, as adjusted each
year in accordance with the further provisions of this paragraph, shall be
increased each year, commencing with the year beginning April 1, 1997, by an
amount equal to, the percentage increase in the Consumer Price Index for Urban
Wage Earners and Clerical Workers (New York, N.Y.--Northern N.J. -- all items
in 1967=100) as periodically published by the Board of Labor Statistics of the
U.S. Department of Labor, in March of each year that this Agreement continues
in force and effect, over the said Index for the month of March in the
preceding year, times the base compensation. For example, if the said Index
for the month of March, 1997 has increased by 5% over the said Index for the
month of March 1996, the Employee's annual base compensation for the year
commending April 1, 1997, shall be increased by $18,000 (i.e., 5% of $360,000)
to the amount of $378,000. If the said Index for the month of March 1998 has
increased by 5% over the said Index for the month of March 1997, the Employee's
base compensation for the year commencing April 1, 1998 shall be increased by
$18,900 (i.e., 5% of $378,000, to the amount of $396,900). If the said Index
or its publication shall be discontinued and no comparable Index shall be
published in place thereof, the Employer and Employee shall endeavor to agree
upon a substitute Index or formula which then reflects the relative comparable
value of the dollar; and if they do not agree upon such substitution, then the
question of a substituted Index or formula shall be submitted to arbitration in
accordance with the arbitration provisions of this Agreement.
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5. Salary Increases; Bonuses. It is understood and
agreed that the Employee's agreement to accept the foregoing base compensation
for his services to the Employer during the term of this Agreement shall not
prohibit, limit or restrict the Board of Directors of the Employer, from
increasing the Employee's compensation or from paying the Employee any bonuses
during the term of this Agreement, if the directors deem same appropriate in
light of the services rendered by the Employee, the business done by the
Employer, the results of operations of the Employer, and such other factors as
the Board of Directors, in their discretion, may deem relevant.
Notwithstanding anything herein to the contrary, the aggregate amount of salary
and bonuses paid to the Employee by the Employer shall not be lower than the
aggregate amount of salary and bonuses paid to the Employer's most highly
compensated executive officer (other than the Employee), inclusive of any
amount paid to such executive officer's family members.
6. Lump Sum Payment. (a) If, in the absence of a
"Change in Control" (as defined in Section 15 hereof), the Employer terminates
this Agreement for reasons other than those specified in Section 16 hereof or
the Employer determines not to renew the Employee's employment under the same
or similar terms as this Agreement (the "Nonrenewal of this Agreement") and the
termination or nonrenewal occurs neither after a Change in Control nor in
connection with a Change in Control, then the Employee shall be entitled to
receive, in addition to any compensation to which he is entitled pursuant to
Sections 4 and 5 hereof through the date of termination, a lump sum payment
(the "Lump Sum Payment") in an amount equal to (i) the highest sum of the
Employee's annual salary and bonus during any one year period of the term of
this Agreement or any one year during any renewal period, as the case may be,
plus
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(ii) his full base salary (as specified in Section 4 hereof) for the remainder
of the term of this Agreement or any renewal period, as the case may be, at the
rate in effect on the date of termination, plus all other amounts to which he
is entitled under any compensation plan of the Employer on the date of
termination. The Employee shall be entitled to receive the Lump Sum Payment
within ten (10) days following (i) the termination date, or (ii) the end of the
term of this Agreement or any renewal period, as the case may be, in the event
of such Nonrenewal of this Agreement by the Employer. Any amounts which the
Employee may earn should he seek other employment shall not be offset against
the amount of the continuing salary or Lump Sum Payment to which he is entitled
to otherwise receive hereunder. In addition, the Employee shall not be
obligated to seek any such other employment to mitigate any payments he is
entitled to receive pursuant to this Agreement. Subject to Section 15 hereof,
the Employee shall not be entitled to receive continuing salary payments or the
Lump Sum Payment in the event that he, not the Employer, determines not to
renew this Agreement at the end of the term hereof, or any renewal period, as
the case may be.
(b) Further, the termination, as described in Section
6(a) above, or the Nonrenewal of this Agreement will entitle the Employee to
continued benefits coverage provided for hereunder for twelve (12) months from
the date of termination or the end of the term of this Agreement or any renewal
period, as the case may be. In addition, the Employer will provide the
Employee, at the Employer's expense, with counseling services of a mutually
acceptable outplacement firm for twelve (12) months from the date of
termination or the end of the term of this Agreement or any renewal period, as
the case may be, subject to the next to last sentence in this paragraph. The
Employee will be permitted to use the same Employer's vehicle provided
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to him pursuant to Section 7 below, for a period of twelve (12) months from the
date of termination or the end of the term of this Agreement or any renewal
period, as the case may be, subject to the following sentence. The Employee
agrees that he will notify the Employer immediately upon obtaining other
employment and that his use of the outplacement services will cease immediately
and use of the Employer vehicle will cease on the first day of the following
month. The Employee shall return the Employer's vehicle to the Employer, at
the Employee's expense (or assume the monthly costs thereof in the case of a
leased vehicle), on or before the first day of such following month.
7. Automobile. The Employer shall provide the Employee
with the use of an automobile while he is employed by the Employer, of such
make and model as the Employee shall reasonably determine. The Employer agrees
to pay all costs of operating, maintaining, servicing, repairing, insuring and
garaging said automobile along with the costs of any car phone which the
Employee has or elects to have installed in such automobile. In the event this
Agreement continues beyond the initial three-year term, the Employer shall
provide the Employee with a new automobile every three years while he is
employed by the Employer.
8. Benefits. (a) Commencing on the date hereof, during
the term hereof and any extension thereof, the Employee shall be entitled to
participate in and enjoy the benefits of any profit sharing, health or other
group insurance, retirement, pension or other similar plan or plans which are
in effect or may be instituted by the Employer for the benefit of its executive
officers or employees generally, upon such term as may be therein provided.
9. Vacation, Holidays and Personal Days. (a) The
Employee shall receive a paid vacation of five weeks a year during the term of
this Agreement. In the event there is
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any unused vacation time due to the Employee upon termination of his employment
with the Employer, he shall be paid for such unused vacation time. Unused
vacation time shall not accrue from year to year.
(b) The Employee shall be entitled to as many holidays
and personal days as are in accordance with the Employer's policy then in
effect for its executive officers generally (but no less favorable than the
Employer's policy existing on the date hereof), upon such terms as may be
provided to all executive officers of the Employer generally.
10. Expenses. The Employer recognizes that the Employee
will incur expenses in connection with his duties hereunder and the business of
the Employer for items such as entertaining, travel, hotels, gifts and similar
items. The Employer agrees to provide the Employee with a corporate American
Express Card in order to pay such expenses and to otherwise reimburse the
Employee for, all such expenses paid or incurred by him (and/or, if requested
by the Employee, to advance the Employee amounts required to cover such
expenses).
Notwithstanding the foregoing, the Employer further recognizes
that the Employee's local expenses and various miscellaneous expenses paid by
the Employee in connection with his duties hereunder and the business of the
Employer may be difficult to account for by the Employee. Accordingly, it is
agreed that the Employee shall be entitled to receive an appropriate amount
from the Employer, as determined by the Employer from time to time, as
reimbursement for local and miscellaneous expenses for which the Employee shall
not be required to account, not to be less than $500 or more than $1,000 per
month. This shall be in addition to reimbursement for travelling,
entertainment, gifts and other items, for which the Employee is able to
account.
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11. Disability. In the event the Employee becomes ill or
disabled during the duration of this Agreement, so that he is unable to perform
his duties to the Employer hereunder, this Agreement shall continue in full
force and effect and the Employee's compensation and other benefits required to
be paid or maintained for the Employee by the Employer shall continue to be
paid and maintained by the Employer during the duration of such illness or
disability; provided, however, that in the event the Employee is ill or
disabled for a continuous period of more than one year during which time he is
unable to perform his duties to the Employer hereunder, the Employer shall have
the right, at its option, at any time during the continuance of said illness or
disability after the said one-year period to terminate this Agreement upon 60
days written notice to the Employee. In such event, the Employer shall
continue to pay the Employee one-half of his annual base compensation and shall
continue to provide the other benefits required to be maintained for the
Employee hereunder for the shorter of (i) a period of three years following the
date of such termination of this Agreement or (ii) March 31, 2005.
12. Other Benefits. This Agreement shall not be deemed
to be in lieu of any rights, benefits or privileges to which the Employee may
be entitled as an employee of the Employer under any retirement, pension,
profit sharing, stock option, incentive or other bonus, life insurance,
disability insurance or other plan or plans which may be adopted by the
Employer, it being understood that the Employee shall have the same rights and
privileges to participate in such plans and benefits as any other employee of
the Employer during the duration of his employment.
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13. Term. Subject to extensions and renewals pursuant to
Section 23 hereof, this Agreement shall continue in force and effect for a
period of three years from the date hereof.
14. Change in Control; Potential Change in Control. (a)
No benefits shall be payable pursuant to this Section 14 unless the Employee is
terminated following a change in control of the Employer (a "Change in
Control") or in connection with a Change in Control. For purpose of this
Agreement, a Change in Control of the Employer shall be deemed to have occurred
if (i) any "person" (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")), other than a
trustee or other fiduciary holding securities under an executive benefit plan
of the Employer or a corporation owned, directly or indirectly, by the
stockholders of the Employer in substantially the same proportions as their
ownership of stock of the Employer, becomes the "beneficial owner" (as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of
the Employer representing 25% or more of the combined voting power of the
Employer's then outstanding securities; provided, however, that a "Friendly
Change in Control" as defined below shall not be deemed a Change in Control; or
(ii) during any period of two consecutive years (not including any period prior
to the execution of this Agreement), individuals who at the beginning of such
period constitute the Board of Directors of the Employer and any new director
(other than a director designated by a person who has entered into an agreement
with the Employer to effect a transaction described in clauses (i) or (iii) of
this subsection) whose election by the Board of Directors of the Employer or
nomination for election by the Employer's stockholders was approved by a vote
of at least two-thirds (2/3) of the directors then still in office who either
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were directors at the beginning of the period or whose election or nomination
for election was previously so approved, cease for any reason to constitute a
majority thereof; or (iii) the shareholders of the Employer approve a merger or
consolidation of the Employer with any other corporation, other than a merger
or consolidation which would result in the voting securities of the Employer
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) at least 80% of the combined voting power of the voting
securities of the Employer or such surviving entity outstanding immediately
after such merger or consolidation, or the shareholders of the Employer approve
an agreement for the sale or disposition by the Employer of all or
substantially all of the Employer's assets.
A "Friendly Change in Control" shall be deemed to occur when
(a) a Change in Control occurs and the Employee acts in conjunction with other
persons or entities and constitutes part of the "person" (as defined above)
which becomes the beneficial owner, directly or indirectly, of the securities
described in Section 15(a)(i), or acts in furtherance of the objectives of such
"person" or (b) the transactions contemplated in that certain Merger Agreement
among the Employer, The Fresh Juice Company of Florida, Inc., Clear Springs
Citrus, Inc., Brian Duffy and The Bogen Group, L.L.C. are consummated.
(b) For purposes of this Agreement, a "potential change
in control" of the Employer shall be deemed to have occurred if (i) the
Employer enters into an agreement, the consummation of which would result in
the occurrence of a Change in Control of the Employer; (ii) any person
(including the Employer) publicly announces an intention to take or to consider
taking actions which if consummated would constitute a Change in Control of the
Employer; (iii)
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any person, other than a trustee or other fiduciary holder securities under an
executive benefit plan of the Employer or a corporation owned directly or
indirectly, by the stockholders of the Employer in substantially the same
proportions as their ownership of stock of the company, who is or becomes the
beneficial owner, directly or indirectly, of securities of the Employer
representing 9.5% or more of the combined voting power of the Employer's then
outstanding securities, increases his beneficial ownership of such securities
by 5% or more over the percentage so owned by such person on the date hereof;
or (iv) the Board adopts a resolution to the effect that, for purposes of this
Agreement, a potential change in control of the Employer has occurred. The
Employee agrees that, subject to the terms and conditions of this Agreement, in
the event of a potential change in control of the Employer, he will remain in
the employ of the Employer until the earliest of (i) the date which is six (6)
months from the occurrence of such potential change in control of the Employer,
(ii) the termination by the Employee of the Employee's employment by reason of
disability (as discussed in Section 11) or retirement (as discussed in Section
17(b)), or (iii) the occurrence of a Change in Control of the Employer.
15. Termination Following Change in Control. If a Change
in Control of the Employer shall have occurred prior to the termination of the
Employee's employment or the termination of the Employee's employment is
occurring in connection with a Change in Control of the Employer, the Employee
shall be entitled to the benefits provided in Section 16 hereof upon the
subsequent termination of his employment during the term of this Agreement or
any renewal period, as the case may be, unless such termination is (i) because
of the Employee's death or retirement (as described in Sections 17(a) and
17(b)), (ii) by the Employer for Cause
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(as defined in Section 17.4(c) or disability (as discussed in Section 11(b), or
(iii) by the Employee other than for Good Reason (as defined below).
(a) Good Reason. In connection with a Change in Control,
the Employee shall be entitled to terminate his employment for Good Reason and
such termination by the Employee shall be deemed to be termination of the
Employee by the Employer. For purposes of this Agreement, "Good Reason" shall
mean without the Employee's express written consent, the occurrence, after a
Change in Control of the Employer, of any of the following circumstances,
unless in the case of clauses (i), (v), (vi) or (vii) below, such circumstances
are fully corrected prior to the date of termination as specified in the
"Notice of Termination" required by subsection 15(b) hereto:
(i) the assignment to the Employee of any duties
inconsistent with the Employee's status as a senior executive officer
of the Employer or a substantial alteration in the nature or status of
the Employee's responsibilities from those in effect immediately prior
to a Change in Control of the Employer;
(ii) a reduction by the Employer in the Employee's annual
base salary as in effect on the date hereof or as the same may be
increased from time to time;
(iii) a new Employer requirement is instituted which
requires the Employee to change his work location to a location
different from that before the Change in Control but not including a
requirement that the Employee travel on the Employer's business to an
extent substantially consistent with his present business travel
obligations;
(iv) the failure by the Employer, without the Employee's
consent, to pay the Employee any portion of his current compensation,
or to pay to the Employee any
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portion of an installment of deferred compensation under any deferred
compensation program of the Employer within seven (7) days of the date
such compensation is due;
(v) the failure by the Employer to continue in effect any
compensation plan in which the Employee participates immediately prior
to the Change in Control of the Company which is material to the
Employee's total compensation, or any substitute plans adopted prior
to the Change in Control, unless an equitable arrangement (embodied in
an on-going substitute or alternative plan) has been made with respect
to such plan in connection with the Change in Control of the Employer,
or the failure by the Employer to continue the Employee's
participation therein;
(vi) the failure by the Employer to continue to provide
the Employee with benefits substantially similar to those enjoyed by
the Employee under any of the Employer's pension, life insurance,
medical, health and accident, or disability plans in which the
Employee was participating at the time of a Change in Control of the
Employer, the taking of any action by the Employer which would
directly or indirectly materially reduce any of such benefits or
deprive the Employee of any such benefits or deprive the Employee of
any material fringe benefit enjoyed by the Employee at the time of the
Change in Control of the Employer, or the failure by the Employer to
provide the Employee with the number of paid vacation days to which
the Employee is entitled on the basis of years of service with the
Employer in accordance with the Employer's normal vacation policy in
effect at the time of the Change in Control; or
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(vii) the failure of the Employer to obtain a satisfactory
agreement from any successor to assume and agree to perform this
Agreement, as contemplated in Section 18 hereof.
The Employee's right to terminate his employment pursuant to
this Subsection 15(a) shall not be affected by his incapacity due to physical
or mental illness. The Employee's continued employment shall not constitute
consent to, or a waiver of rights with respect to, any circumstances
constituting Good Reason hereunder.
(b) Notice of Termination. Any purported termination by
the Employer or by the Employee shall be communicated by written notice of
termination ("Notice of Termination") to the other party hereto in accordance
with Section 20 hereof and shall state the grounds for termination and the
effective date thereof. Any purported termination of the Employee's employment
which is not effected pursuant to a Notice of Termination shall not be
effective in discharging the Employee.
16. Compensation upon Termination. (a) If the
Employee's employment by the Employer shall be terminated following a Change in
Control of the Employer in connection with a Change in Control and such
termination is for reasons other than for Cause (as hereinafter defined),
retirement, death or disability or if the Employee is deemed terminated
pursuant to Section 15(a), then the Employee shall be entitled, at his
election, to the benefits provided below:
1. The Employer shall continue to pay the Employee,
except as otherwise provided below, either (i) his full base salary
(as specified in Section 4 hereof) for the remainder of the term of
this Agreement or any renewal period, as the case may be, at
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the rate in effect on the date of termination, plus all other amounts
to which he is entitled under any compensation plan of the Employer on
the date of termination or (ii) a lump sum severance payment (the
"Severance Payment") equal to 2.99 times his "base amount", as defined
in Section 280G of the Internal Revenue Code of 1986, as amended (the
"Code") and reduced as discussed below. Such base amount shall be
determined in accordance with temporary or final regulations, if any,
promulgated under Section 280G of the code and based upon the advice
of the tax counsel referred to in clause (2), below. The Employee
shall make his election by written notice to the Employer within ten
(10) business days after he receives a Notice of Termination or, if
the Employee is terminating this Agreement for Good Reason, such
election shall be stated in his Notice of Termination to the Employer.
2. The Severance Payment shall be reduced by the amount
of any other payment or the value of any benefit received or to be
received by the Employee in connection with a Change in Control of the
Employer or the Employee's termination of employment (whether pursuant
to the terms of this Agreement, any other plan, agreement or
arrangement with the Employer, any person whose actions result in
control, or any person affiliated with the Employer or such person)
unless (i) the Employee shall have effectively waived his receipt or
enjoyment of such payment or benefit prior to the date of payment of
the Severance Payment, (ii) in the opinion of tax counsel selected by
the Employer's independent auditors and acceptable to the Employee,
such other payment or benefit does not constitute a "parachute
payment" within the meaning of Section 280G(b)(2) of the Code, or
(iii) in the opinion of such tax counsel, the Severance
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Payment (in its full amount or as partially reduced under this clause
2, as the case may be) plus all other payments or benefits which
constitute "parachute payments" within the meaning of Section
280G(b)(2) of the Code are reasonable compensation for services
actually rendered, within the meaning of Section 280G(b)(4) of the
Code or are otherwise not subject to disallowance as a deduction by
reason of Section 280G of the Code. The value of any non-cash benefit
or any deferred cash payment shall be determined by the Employer's
independent auditors in accordance with the principles of Sections
280G(d)(3) and (4) of the Code.
3. Except to the extent that such payments would result
(or, if paid after the Severance Payment, would have resulted) under
clause 2 above, in a reduction in the Severance Payment,
notwithstanding any provision of an incentive plan, if any, the
Employer shall pay to the Employee a lump sum amount equal to the sum
of (x) any incentive compensation which has been allocated or awarded
to him for a fiscal year or other measuring period preceding the date
of termination but which has not yet been paid, and (y) all legal fees
and expenses incurred by the Employee as a result of such termination
(including all such fees and expenses, if any, incurred in contesting
or disputing any such termination or in seeking to obtain or enforce
any right or benefit provided by this Agreement or in connection with
any tax audit or proceeding to the extent attributable to the
application of Section 4999 of the Code to any payment or benefit
provided hereunder), such payment to be made at the later of the times
provided in clause 4, below, or within five (5) days after the
Employee's request for payment
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accompanied with such evidence of fees and expenses incurred as the
Employer reasonably may require.
4. The payments provided for in clauses 16(a)(1) and
16(a)(3) above, shall (except as otherwise provided therein) be made
not later than the fifth day following the date of termination;
provided, however, that if the amounts of such payments, and the
limitation on such payments set forth in clause 16(a)(2) above, cannot
be finally determined on or before such day, the Employer shall pay to
the Employee on such day an estimate, as determined in good faith by
the Employer, of the minimum amount of such payments and shall pay the
remainder of such payments (together with interest at the rate
provided in Section 1247(b)(2)(B) of the Code) as soon as the amount
thereof can be determined but in no event later than the thirtieth
day after the date of termination. In the event that the amount of
the estimated payments exceeds the amount subsequently determined to
have been due, such excess shall constitute a loan by the Employer to
the Employee, payable on the fifth day after demand by the Employer
(together with interest at the rate provided in Section 1247(b)(2)(B)
of the Code).
5. The Employee shall not be required to mitigate the
amount of any payment provided for in this Section 16 by seeking other
employment or otherwise, nor shall the amount of any payment or
benefit provided for in this Section 16 be reduced by any compensation
earned by the Employee as the result of employment by another
employer, by retirement benefits, by offset against any amount claimed
to be owed by the Employee to the Employer or otherwise.
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<PAGE> 19
17. Termination. This Agreement shall terminate earlier
than the stated term in the following circumstances:
(a) Death. In the event of the Employee's death
during the term of this Agreement or any renewal period, as the case may be,
this Agreement shall terminate on the date of death.
(b) Retirement. The Employee retires voluntarily
under the Employer's retirement plan.
(c) Cause. The Employer may terminate the
Employee for Cause. "Cause" shall mean termination upon (i) the willful and
continued failure by the Employee to perform substantially his duties with the
Employer (other than any such failure resulting from the Employee's incapacity
due to physical or mental illness or any such actual or anticipated failure
after the issuance of a Notice of Termination by the Employee for Good Reason),
30 days after a written demand for substantial performance is delivered to the
Employee by the Board of Directors which specifically identifies the manner in
which the Board of Directors believes that the Employee has not substantially
performed his duties, or (ii) the conviction of the Employee of any felony or a
crime involving larceny. For purposes of this Section 17(c), no act, or
failure to act, on the Employee's part shall be considered "willful" unless
done, or omitted to be done, by the Employee not in good faith and without
reasonable belief that the Employee's action or omission was in the best
interest of the Employer. Notwithstanding the foregoing, the Employee shall
not be deemed to have been terminated for Cause unless and until there shall
have been delivered to the Employee a resolution duly adopted by the unanimous
vote of the entire membership of the Board of Directors, exclusive of the
Employee, at a meeting of
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<PAGE> 20
the Board of Directors called and held for such purpose (after reasonable
notice to and an opportunity for the Employee, together with the Employee's
counsel, to be heard before the Board of Directors), finding that in the good
faith opinion of the Board of Directors, the Employee was guilty of conduct set
forth above in clauses (i) or (ii) of the second sentence of this Section 17(c)
and specifying the particulars thereof in detail; provided, however, that no
such meeting may be called or held by the Board of Directors of the Employer
for such purpose prior to April 1, 1999, unless the Employee has been first
convicted of a crime in which the Employee appropriated, for his benefit, any
assets of the Employer. Notwithstanding anything herein to the contrary, if
the Employee is terminated during the first three (3) years of the term for any
reason other than for a conviction of a crime in which the Employee
appropriated, for his benefit, any assets of the Employer, the Employee shall
continue to be paid his salary and bonus (and his benefits and entitlement to
use of an automobile as described in Section 7 hereof shall also continue) for
the remainder of the first three (3) years of the term; and further provided
that if the Employee is terminated for alleged "Cause" at any time during the
term or any renewal thereof and it is later determined by a court of competent
jurisdiction that no "Cause" existed for the termination, the Employer shall be
liable for all salary, bonuses, benefits and automobile entitlement due and not
yet paid under the term or any renewal thereof and such sum shall be paid in a
lump sum to the Executive with pre-judgment and post-judgment interest thereon.
Notwithstanding anything herein to the contrary, Cause shall
not include a failure by the Employee to render services at the Employer's
executive/administrative offices in New
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<PAGE> 21
Jersey so long as the Employee continues to perform his duties and obligations
hereunder from other reasonable locations.
18. Successors and Assigns. This Agreement shall inure
to the benefit of and be binding upon the Employer, its successors and assigns,
including without limitation, any company which may acquire all or
substantially all of the Employer's assets and business or into which the
Employer may be merged, and upon the Employee, his heirs, legal
representatives, successors and assigns. The Employee may assign his right to
benefits under this Agreement but not his obligations under this Agreement.
19. Waiver. The failure of the Employer or the Employee
to insist, in any one or more instances, on performance of any term or
condition of this Agreement, shall not be construed as a waiver of any such
term, or condition, or any other term or condition, and the obligations of the
parties with respect thereto shall continue in full force and effect.
20. Notices. Any notice required to or which may be sent
hereunder shall be sent in writing, by registered or certified mail, return
receipt requested, addressed to the party for whom it is intended at the
address set forth on page 1 of this Agreement for such party. Either party
hereto may, at any time or from time to time, change the address to which
notices shall be sent in accordance with the provisions of this Section.
21. Governing Law. This Agreement has been made and
shall be construed in accordance with the laws of the State of New Jersey.
This Agreement, when effective, supersedes all previous agreements between the
Employee and Employer regarding employment.
22. Renewal. The Employee shall have the right and
option to extend and renew this Agreement for two additional periods of three
(3) years each (for a total of six (6)
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<PAGE> 22
additional years). The Employee shall automatically be deemed to have
exercised such right and option to extend and renew this Agreement at the
expiration of the initial and each renewal term unless he shall send written
notice to the Employer or his intention not to renew at least 60 days prior to
the expiration of the initial or any renewal term.
23. Arbitration. Any controversy between the Employee
and Employer relating to this Agreement, or to the meaning or performance
thereof, shall be settled by arbitration in accordance with the rules and
regulations of the American Arbitration Association then in force and effect.
Judgment on any award rendered in such arbitration may be entered in any court
having jurisdiction.
24. Protection of Confidential Information.
24.1. Confidentiality. In view of the fact that the
Employee's work as an Executive of the Employer and its Subsidiaries and their
respective affiliates will bring him into close contact with many confidential
affairs of the Employer and its Subsidiaries and their respective affiliates,
including the names of the Employer's and its Subsidiaries' customers and
suppliers, matters of a business nature such as information about costs,
profits, markets, sales, other information not readily available to the public,
and plans for future developments (hereinafter collectively "Confidential
Matters"), the Employee agrees: (i) to keep secret all Confidential Matters of
the Employer and its Subsidiaries and their respective affiliates, and not to
disclose such Confidential Matters to anyone outside of the Employer and its
Subsidiaries (other than the Employer's customers or potential customers and
the Employer's vendors or suppliers or potential vendors or suppliers), either
during or after his employment with the Employer, except with the Employer's
written consent at each time as to any Confidential Matter
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<PAGE> 23
which is to be disclosed, and (ii) to deliver promptly to the Employer on
termination of his employment, or at any time the Employer may so request, all
memoranda, notes, records, reports, lists and other documents (and all copies
thereof) and materials relating to the Employer's and its Subsidiaries' and
their respective affiliates business which he may then possess or have under
this control.
24.2. Agreement Not To Compete. During the period from the
date hereof until one (1) year after the termination or nonrenewal of the
Employee's employment with the Employer and/or its Subsidiaries for any reason
set forth in Section 17 hereof, the Employee shall not (i) purchase an
ownership interest of greater than 5% of a company or other entity which is at
such time engaged in the citrus juice beverage industry and active in the same
geographic area as the Employer or any of its Subsidiaries or their respective
affiliates, is otherwise competitive with the Employer or any of its
Subsidiaries or their respective affiliates, or is attempting to enter such
industry in such geographic area or to become otherwise competitive; (ii) act
as a consultant, officer, director or in any other capacity, whose
responsibilities are related to the citrus juice beverage industry in the same
geographic area as the Employer or any of its Subsidiaries operates; or (iii)
solicit in any way or entice away from the Employer or its Subsidiaries or
their respective affiliates (a) any clients or account of the Employer or its
Subsidiaries or their respective affiliates which were active clients or
accounts of the Employer or its Subsidiaries or their respective affiliates
during the Employee's employment with the Employer, (b) any prospective client
or account of the Employer or its Subsidiaries or their respective affiliates
which the Employer or its Subsidiaries or their respective affiliates was
actively engaged in soliciting during the Employee's employment with
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<PAGE> 24
the Employer, (c) any employee of the Employer or its Subsidiaries or their
respective affiliates (unless such employee shall have either been discharged
by such entity or shall have otherwise ceased to be employed by such entity for
a period of 365 days) or (d) any manufacturers or suppliers of the Employer's
or its Subsidiaries or their respective affiliates, which were manufacturers or
suppliers of the Employer or its Subsidiaries or their respective affiliates
during the Employee's employment with the Employer. Notwithstanding the
foregoing, however, if the Employer fails to make any payments due hereunder to
the Employee when due, the provisions of this Section 24.2 shall not apply.
24.3. Remedies. The Employee recognizes that any breach of
the covenants contained in Sections 24.1 or 24.2 hereof would irreparably
injure the Employer. Accordingly, the Employee agrees that any breach of the
covenants contained in Sections 24.1 or 24.2 hereof will result in forfeiture
to the Employer as liquidated damages of any and all amounts otherwise payable
to the Employee under this Agreement as of and from the date of such breach.
Furthermore, the Employer may, in addition to pursuing its other remedies,
obtain an injunction against the Employee from any court having jurisdiction
over the matter, restraining any further violation of this Agreement by the
Employee and no bond or other security shall be required in connection with
such injunction.
(b) In the event the Employee prevails in any judicial
proceeding relating to a breach by the Employer hereunder, (i) all sums
determined to be due hereunder in such judicial proceeding shall be due and
payable in a lump sum (unless otherwise ordered by the court in which such
judicial proceeding is brought) and (ii) the Employer shall be liable for all
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<PAGE> 25
fees and expenses, including attorneys' fees, incurred by the Employee in
connection with any action taken to enforce this Agreement or obtain judgment
for a breach hereof.
24.4. Reformation. If any of the covenants contained in
Sections 24.1 or 24.2 hereof, or any part thereof, are held to be unenforceable
because of the scope or duration of any such provision, the parties agree that
the body making such determination shall have the power to reduce the scope or
duration of such provision and, in its reduced form, said provision shall be
enforceable. If any of the covenants in Sections 24.1 or 24.2 hereof, or any
part thereof, is hereafter construed to be invalid or unenforceable, the same
shall not affect the remainder of the covenants, which shall be given full
force and effect without regard to the invalid provisions.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement the day and year first written.
THE FRESH JUICE COMPANY, INC.
By:/s/ Steven M. Bogen
-------------------------------------------
Name: Steven M. Bogen
Title: Chief Executive Officer
/s/ Steven Smith
----------------------------------------------
Steven Smith
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