1
Exhibit 10.32
Carlyle Industries, Inc.
c/o Noel Group, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
February 25, 1998
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ Industries, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear ▇▇. ▇▇▇▇▇▇▇:
This letter sets forth and confirms the agreement between Carlyle
Industries, Inc. (the "Company") and you regarding the terms of your continued
employment with the Company, which terms were approved by the Company's Board
of Directors at a meeting held on December 18, 1997. The agreement between you
and the Company is as follows:
1. Employment. The Company hereby agrees to continue your employment as
Chairman, President and Chief Executive Officer of the Company. You will report
to and be responsible to the Board of Directors of the Company.
2. Salary. The Company agrees to pay you an annual salary at the rate of
$250,000 per annum payable in accordance with the payroll practices of the
Company, plus any accrued and unpaid bonus. Your annual salary shall be
reviewed annually and may be increased in the discretion of the Board or the
Compensation Committee thereof. You shall also be entitled to participate in
the Company's Management Incentive Plan and all health insurance, profit
sharing, employee stock option and similar plans and benefits afforded by the
Company to its management employees generally, if and to the extent that you
are eligible to participate in such plans and benefits in accordance with their
terms.
3. Severance.
a. In the event of a Change in Control (as defined below) of the Company,
the Company shall pay you, in a single lump sum payment, within 30 days after
such occurrence, an amount equal to your entire annual base salary then in
effect (i.e., $250,000 at the compensation rate in effect on the date hereof or
such larger amount as may reflect the compensation rate in effect at a later
date due to annual salary increases). For purposes hereof, a
2
"Change of Control" of the Company shall be deemed to have occurred upon the
occurrence of any of the following events:
(i) A change in control of the direction and administration of the
Company's business of a nature that if any securities of the Company were
registered under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), would be required to be reported in response to (a) Item
6(e) of Schedule 14A of Regulation 14A promulgated under the Exchange Act,
or (b) Item 1(a) of Form 8-K under the Exchange Act as each is in effect on
the date hereof and any successor provision of such regulations under the
Exchange Act, whether or not the Company is then subject to such reporting
requirements; or
(ii) Any "person" or "group" (as such term is used in connection with
Section 13(d) and 14(d)(2) of the Exchange Act) but excluding any employee
benefit plan of the Company or any "affiliate" or "associate" of the
Company (as defined in Regulation 12b-2 under the Exchange Act) (a) is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company representing
fifty percent (50%) or more of the combined voting power of the Company's
outstanding securities then entitled ordinarily (and apart from rights
accruing under special circumstances) to vote for the election of directors
or (b) acquires by proxy or otherwise 50% or more of the combined voting
securities of the Company having the right to vote for the election of
directors of the Company, for any merger or consolidation of the Company,
for the election of Directors, or for any other matter; or
(iii) During any period of twenty-four (24) consecutive months, the
individuals who at the beginning of such period constitute the Board of
Directors of the Company or any individuals who would be "Continuing
Directors" (as hereinafter defined) cease for any reason to constitute at
least a majority thereof. For purposes of this Agreement, "Continuing
Directors" shall mean the directors of the Company in office on the date
hereof and any successor to any such director and any additional director
who after the date hereof (i) was nominated or selected by a majority of
the Continuing Directors in office at the time of his nomination or
selection and (ii) who is not an "affiliate" or "associate" (as defined in
Regulation 12b-2 under the Exchange Act) of any person who is the
beneficial owner, directly or indirectly, of securities representing ten
percent (10%) or more of the combined voting power of the Company's
outstanding securities then entitled ordinarily to vote for the election of
directors; or
(iv) The Company shall cease to meet the basic conditions of listing
on the New York Stock Exchange in respect of the number of the Company's
Common Stock (as hereinafter defined) held by the public; or
(v) There shall be consummated (A) any consolidation, merger or
recapitalization of the Company or any similar transaction involving the
2
3
Company, whether or not the Company is the continuing or surviving
corporation, pursuant to which shares of the Company's common stock, par
value $.01 per share ("Common Stock"), would be converted into cash,
securities or other property, other than a merger of the Company in which
the holders of Common Stock immediately prior to the merger have the same
proportion and ownership of common stock of the surviving corporation
immediately after the merger, (B) any sale, lease, exchange or other
transfer (in one transaction or a series of related transactions) of all,
or substantially all, of the assets of the Company or (C) the adoption of a
plan of complete liquidation of the Company (whether or not in connection
with the sale of all or substantially all of the Company's assets) or a
series of partial liquidations of the Company that is de jure or de facto
part of a plan of complete liquidation of the Company; provided, that the
divestiture of less than substantially all of the assets of the Company in
one transaction or a series of related transactions, whether effected by
sale, lease, exchange, spin-off, sale of the stock or merger of a
subsidiary of the Company or otherwise, or a transaction solely for the
purpose of reincorporating the Company in another jurisdiction, shall not
constitute a "Change in Control"; or
(vi) The Board of Directors of the Company shall approve any
merger, consolidation or like business combination or reorganization of
the Company, the consummation of which would result in the occurrence of
any event described (i), (ii) or (v) above.
The Company hereby reaffirms that, as set forth in the minutes of the
Compensation Committee meeting dated May 16, 1997, you shall also be entitled
to receive a "transaction bonus" in the amount of $100,000 in the event of a
sale of all, or substantially all, of the capital stock or assets of the
Company.
b. In the event that the Company terminates your employment for any
reason whatsoever, whether with or without cause, other than in connection with
a Change in Control of the Company, the Company shall pay you, in a single lump
sum payment, within 30 days after such termination, an amount equal to six
months of your annual base salary in effect on the date of such termination
(i.e., $125,000 at the compensation rate in effect on the date hereof or such
larger amount as may reflect the compensation rate in effect at a later date
due to annual salary increases). The Company agrees to present the foregoing
provision to the Board at the first full Board meeting after February 1, 1998
for consideration of increasing the sum payable in event of such termination to
an amount equal to your entire annual base salary then in effect (i.e.,
$250,000 at the compensation rate in effect on the date hereof or such larger
amount as may reflect the compensation rate in effect at a later date due to
annual salary increases).
4. General. This Agreement may not be modified except by a written
instrument duly executed by both parties. This Agreement and the performance
hereunder shall be governed by and construed in accordance with the laws of the
State of New York. The failure of either party to exercise in any respect any
right provided for herein shall not be deemed a waiver of any right hereunder.
This Agreement and the rights and duties hereunder shall not be assignable by
either party hereto except upon the written consent of the other party. This
3
4
Agreement may be executed in counterparts, each of which shall be deemed one
and the same instrument.
Please confirm that the foregoing accurately sets forth our
understanding by executing the enclosed copy of this letter and returning it to
us.
CARLYLE INDUSTRIES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------
AGREED TO AND ACCEPTED
as of the date of the signature below.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇
Dated: Feb. 25, 1998
----------------
4