-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OPsNeKRjy3cu2tqjlbP0718fIjBBIA1PTzuTQTcTTDaz+Wh+deOf33PGz4Ayntc1 uz91ckidfGl0DxgbjHQwsw== 0000899243-01-500796.txt : 20010620 0000899243-01-500796.hdr.sgml : 20010620 ACCESSION NUMBER: 0000899243-01-500796 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 8 FILED AS OF DATE: 20010619 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: ICO INC CENTRAL INDEX KEY: 0000353567 STANDARD INDUSTRIAL CLASSIFICATION: OIL, GAS FIELD SERVICES, NBC [1389] IRS NUMBER: 760566682 STATE OF INCORPORATION: TX FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-34170 FILM NUMBER: 1663475 BUSINESS ADDRESS: STREET 1: 11490 WESTHEIMER RD STREET 2: STE 100 CITY: HOUSTON STATE: TX ZIP: 77067 BUSINESS PHONE: 2817214200 MAIL ADDRESS: STREET 1: 11490 WESTHEIMER STREET 2: STE 1000 CITY: HOUSTON STATE: TX ZIP: 77077 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: PBG ACQUISITION CORP CENTRAL INDEX KEY: 0001140099 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 760677665 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 725 CAMELOT LANE CITY: HOUSTON STATE: TX ZIP: 77024 MAIL ADDRESS: STREET 1: 725 CAMELOT LANE CITY: HOUSTON STATE: TX ZIP: 77024 SC 13D/A 1 dsc13da.txt AMENDMENT #1 TO SC 13D UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 13D UNDER THE SECURITIES EXCHANGE ACT OF 1934* AMENDMENT NO.1 ICO, INC. -------------------------------------------------------- (NAME OF ISSUER) COMMON STOCK, NO PAR VALUE PER SHARE -------------------------------------------------------- (TITLE OF CLASS OF SECURITIES) 449293109 -------------------------------------------------------- (CUSIP NUMBER) DAVID M. GERST 725 CAMELOT LANE HOUSTON, TEXAS 77024 (281) 365-0923 -------------------------------------------------------- (NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICES AND COMMUNICATIONS) JUNE 7, 2001 -------------------------------------------------------- (DATE OF EVENT WHICH REQUIRES FILING OF THIS STATEMENT) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Sections 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. [ ] Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Section 240.13d-7 for other parties to whom copies are to be sent. * The remainder of this cover page should be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required in the remainder of this cover page shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). CUSIP NO. 449293109 (1) Names of Reporting Person. I.R.S. Identification Nos. of above persons (entities only) Dr. Al O. Pacholder -------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [X] (b) [ ] --------------------------------------------------------------- (3) SEC Use Only -------------------------------------------------------------------- (4) Source of Funds PF, OO -------------------------------------------------------------------- (5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] -------------------------------------------------------------------- (6) Citizenship or Place of Organization United States citizen -------------------------------------------------------------------- Number of Shares Beneficially owned by each reporting person with - -------------------------------------------------------------------- (7) Sole Voting Power 252,955 - -------------------------------------------------------------------- (8) Shared Voting Power 807,270 - -------------------------------------------------------------------- (9) Sole Dispositive Power 252,955 - -------------------------------------------------------------------- (10) Shared Dispositive Power 807,270 - -------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by Each Reporting Person 1,060,225 -------------------------------------------------------------------- (12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares [X] -------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 4.7% -------------------------------------------------------------------- (14) Type of Reporting Person IN -------------------------------------------------------------------- 2 CUSIP NO. 449293109 (1) Names of Reporting Person. I.R.S. Identification Nos. of above persons (entities only) David M. Gerst -------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [X] (b) [ ] --------------------------------------------------------------- (3) SEC Use Only -------------------------------------------------------------------- (4) Source of Funds 00 -------------------------------------------------------------------- (5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] -------------------------------------------------------------------- (6) Citizenship or Place of Organization United States citizen -------------------------------------------------------------------- Number of Shares Beneficially owned by each reporting person with - -------------------------------------------------------------------- (7) Sole Voting Power 53,350 - -------------------------------------------------------------------- (8) Shared Voting Power 0 - -------------------------------------------------------------------- (9) Sole Dispositive Power 53,350 - -------------------------------------------------------------------- (10) Shared Dispositive Power 0 - -------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by Each Reporting Person 53,350 -------------------------------------------------------------------- (12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares [X] -------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) Less Than 1% -------------------------------------------------------------------- (14) Type of Reporting Person IN -------------------------------------------------------------------- 3 CUSIP NO. 449293109 (1) Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) Jon C. Biro -------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [X] --------------------------------------------------------------- (b) [ ] --------------------------------------------------------------- (3) SEC Use Only -------------------------------------------------------------------- (4) Source of Funds PF, OO -------------------------------------------------------------------- (5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] -------------------------------------------------------------------- (6) Citizenship or Place of Organization United States citizen -------------------------------------------------------------------- Number of Shares Beneficially owned by each reporting person with - -------------------------------------------------------------------- (7) Sole Voting Power 53,844 - -------------------------------------------------------------------- (8) Shared Voting Power 12,000 - -------------------------------------------------------------------- (9) Sole Dispositive Power 53,844 - -------------------------------------------------------------------- (10) Shared Dispositive Power 12,000 - -------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by Each Reporting Person 65,844 -------------------------------------------------------------------- (12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares [ ] -------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) Less than 1% -------------------------------------------------------------------- (14) Type of Reporting Person IN -------------------------------------------------------------------- 4 INTRODUCTORY NOTE This Amendment No. 1 to Schedule 13D (the "Amendment") is being filed on behalf of the individuals listed on the cover page to supplement and amend certain information set forth in Schedule 13D relating to securities of ICO, Inc. (the "Company"), originally filed on May 17, 2001 (the "Original Statement"), with respect to no par value common stock ("Common Stock") of the Company. Unless otherwise indicated, each capitalized term used but not defined shall have the meaning assigned to such term in the Original Statement. Unless amended or restated, the Original Statement remains in effect. 5 ITEM 4. PURPOSE OF TRANSACTION. Item 4 is supplemented as follows: On June 5, 2001, a Standstill Agreement (attached hereto as Exhibit 1 and incorporated herein by reference) was entered into between Dr. Asher O. Pacholder ("Pacholder"), Sylvia A. Pacholder, Robin E. Pacholder, Tom D. Pacholder, David M. Gerst (each a member of, and collectively, the "Pacholder Group"), Pacholder Associates, Inc. and Travis Street Partners, LLC. Under the terms of the Standstill Agreement, no member of the Pacholder Group, among other things, (i) will or will permit any entity under the control of such member to directly or indirectly solicit proxies with respect to any of the Company's securities entitled to vote for directors ("Voting Securities"); (ii) acquire directly or indirectly ownership of Voting Securities, except upon the exercise of vested stock options held by members of the Pacholder Group as of June 5, 2001, or the Company's 10-3/8% Senior Notes dues 2007; (iii) join any group for the purpose of acquiring, holding, voting or disposing of Voting Securities; or (iv) initiate or induce any other party to initiate any proposal or tender offer to acquire any Voting Securities. On June 7, 2001, the Company entered into termination agreements (collectively, the "Termination Agreements") (attached hereto as Exhibits 2-6 and incorporated herein by reference) with each member of the Pacholder Group. Under the terms of the Termination Agreement, the Company terminated each member of the Pacholder Group from all of their respective positions with the Company and its affiliates or subsidiaries (except any positions held in Pacholder Associates, Inc. or the Pacholder High Yield Fund). In addition, the Company accepted the resignations of Pacholder and Sylvia A Pacholder as directors of the Company. The Company then elected the following individuals to the offices set forth next to their name: John Williamson, Chairman of the Board of Directors; Timothy J. Gollin, President and Chief Executive Officer, and Christopher N. O'Sullivan, Vice Chairman and Chief Financial Officer. Messrs. Gollin and O'Sullivan have also been appointed to the Company's Board of Directors. Additionally, as disclosed in the Original Statement, Pacholder is also a member of a group in connection with a voting agreement (the "Agreement") to which he is a party. The Company's Board of Directors adopted a resolution providing that the agreement be terminated (attached hereto as Exhibit 7 and incorporated herein by reference). The number of shares beneficially owned by Pacholder covered by this Amendment do not include those shares which were previously subject to the Agreement. Additionally, subsequent to the termination of the Agreement, each member of the Pacholder Group has a beneficial ownership of less than 5% of the Company's outstanding capital stock. 6 ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. 1. Standstill Agreement 2. Termination Agreement by and between Asher O. Pacholder and ICO, Inc., effective as of June 7, 2001. 3. Termination Agreement by and between Sylvia A. Pacholder and ICO, Inc., effective as of June 7, 2001. 4. Termination Agreement by and between Robin E. Pacholder and ICO, Inc., effective as of June 7, 2001. 5. Termination Agreement by and between David M. Gerst and ICO, Inc., effective as of June 7, 2001 6. Termination Agreement by and between Tom D. Pacholder, ICO, Inc. and Wedco, Inc., a New Jersey corporation and wholly-owned subsidiary of ICO, Inc., effective as of June 7, 2001. 7. Board Resolution Terminating the Agreement. 7 After reasonable inquiry and to the best knowledge and belief of the undersigned, it is hereby certified that the information set forth in this statement is true, complete and correct. Dated: June 19, 2001 /s/ Dr. Al O. Pacholder -------------------------------------- Dr. Al O. Pacholder /s/ Jon C. Biro -------------------------------------- Jon C. Biro /s/ David M. Gerst -------------------------------------- David M. Gerst 8 EXHIBIT INDEX EXHIBIT NO. DESCRIPTION - --------- ----------- 1. Standstill Agreement 2. Termination Agreement by and between Asher O. Pacholder and ICO, Inc., effective as of June 7, 2001. 3. Termination Agreement by and between Sylvia A. Pacholder and ICO, Inc., effective as of June 7, 2001. 4. Termination Agreement by and between Robin E. Pacholder and ICO, Inc., effective as of June 7, 2001. 5. Termination Agreement by and between David M. Gerst and ICO, Inc., effective as of June 7, 2001. 6. Termination Agreement by and between Tom D. Pacholder, ICO, Inc. and Wedco, Inc., a New Jersey corporation and wholly-owned subsidiary of ICO, Inc., effective as of June 7, 2001. 7. Board Resolution Terminating the Agreement 9 EX-99.1 2 dex991.txt STANDSTILL AGREEMENT EXHIBIT 1 STANDSTILL AGREEMENT This STANDSTILL AGREEMENT, dated as of June 5, 2001 and effective as of the Effective Date (as defined below) (this "Agreement"), is among Travis Street Partners, LLC ("TSP") and Asher O. Pacholder, Sylvia A. Pacholder, Robin E. Pacholder, Tom D. Pacholder, David M. Gerst and Pacholder Associates, Inc. ("PAI") (each, a member of, and collectively, the "Pacholder Group"). WHEREAS, it is contemplated by the parties that Asher O. Pacholder and Sylvia A. Pacholder may cease to be members of the Board of Directors of ICO, Inc. (the "Company") and all committees thereof and the Boards of Directors of all subsidiaries of the Company and all committees thereof; and WHEREAS, it is contemplated by the parties that each member of the Pacholder Group, other the PAI, may cease to be an employee of the Company pursuant to the terms of those certain respective proposed draft termination agreements; NOW, THEREFORE, in consideration of the mutual covenants contained herein, and intending to be legally bound hereby, the parties hereto agree as follows: 1. Effectiveness. The terms and provisions of this Agreement shall become effective upon each of Asher O. and Sylvia A. Pacholder ceasing to be an employee and a director of the Company, pursuant to the terms of those certain termination agreements expected to be entered into between the Company and such individuals (the "Termination Agreements"). (The time at which all of the foregoing shall have occurred is hereinafter referred to as the "Effective Time"). Notwithstanding anything herein to the contrary, no term or provision of this Agreement shall be binding on any party hereto until such time, if ever, as the Effective Time has occurred. 2. Term of this Agreement. The respective covenants and agreements of the Pacholder Group contained in Sections 3 and 4(b) of this Agreement (the "Standstill Agreements") shall remain in full force and effect during the period from the Effective Date through and including the third anniversary of the Effective Date (the "Standstill Period"). Except as otherwise expressly provided herein, at the end of the Standstill Period, the Standstill Agreements shall expire, but all other covenants and agreements of the parties contained in this Agreement shall survive and remain in full force and effect. 3. Certain Agreements of the Pacholder Group. No member of the Pacholder Group will, or will permit any entity under the control (including but not limited to funds or trusts under investment management control) of such member (whether alone or together with other Pacholder Group members) to, directly or indirectly: (a) solicit proxies with respect to any common stock or any other securities of the Company entitled to vote generally for the election of directors or any security convertible into or exchangeable for or exercisable for the purchase of common stock or other E-9-1 securities of the Company entitled to vote generally for the election of directors (collectively, "Voting Securities"), or become a "participant" in a "solicitation" (as such terms are defined in Regulation 14A under the Exchange Act of 1934, as amended) in opposition to the recommendation of the Board of Directors of the Company; or (b) deposit any Voting Securities in a voting trust or subject them to a voting agreement or other arrangement of similar effect; or (c) acquire or offer to acquire or agree to acquire, directly or indirectly, by purchase or otherwise any record or beneficial ownership of (a) Voting Securities, except (i) through stock splits, stock dividends or other pro rata distributions or offerings made by the Company to holders of any class of Voting Securities generally, (ii) if such acquisition is as a result of the issuance by the Company of Voting Securities pursuant to the terms of any merger or other means of acquisition in exchange for securities of a corporation or other entity acquired in whole or in part by the Company or any of its subsidiaries which securities were owned by any member of the Pacholder Group prior to the time of the first public announcement of the acquisition or, if sooner, the time any member of the Pacholder Group learned of the acquisition or (iii) upon the exercise of stock options to purchase shares of the Company's common stock vested in and held by members of the Pacholder Group as of the Effective Date or (b) the Company's 10-3/8% Senior Notes due 2007; or (d) join a partnership, limited partnership, syndicate, or other group or 13D Group (as hereinafter defined) (other than the Pacholder Group) for the purpose of acquiring, holding or disposing of Voting Securities within the meaning of Section 13(d) of the Securities Exchange Act of 1934. As used herein, the term "13D Group" shall mean any group of persons formed for the purpose of acquiring, holding, voting or disposing of Voting Securities which would be required under Section 13(d) of the Exchange Act and the rules and regulations thereunder (as now in effect and based on present legal interpretations thereof) to file a statement on Schedule 13D with the Securities and Exchange Commission as a "person" within the meaning of Section 13(d)(3) of the Exchange Act if such group beneficially owned more than 5% of any class of equity securities of the Company then outstanding; or (e) initiate, induce or attempt to induce or give encouragement to any other party or parties to initiate any proposal or tender or exchange offer for Voting Securities or to otherwise acquire any Voting Securities, or any change of control of the Company; or (f) make any proposal (or fail to withdraw on or promptly after the Effective Date any existing proposal) regarding a business combination or transaction involving the Company or solicit or invite proposals from, or otherwise induce or give encouragement to any other party or parties to make any proposal regarding a merger, consolidation, business combination or similar transaction involving the Company; or E-9-2 (g) acquire or permit any entity under his or her control (including but not limited to subsidiaries and employee pension, profit sharing or other trusts under investment management control of any member of the Pacholder Group) to acquire, by purchase or otherwise, more than 5% of any class of equity securities of any entity which, prior to the time the Pacholder Group acquires more than 5% of such class, is publicly disclosed (by filing with the Securities and Exchange Commission or otherwise) to be the beneficial owner of more than 5% of any class of Voting Securities; or (h) execute any written consent or demand in lieu of a meeting with respect to Voting Securities (other than written consents or demands in lieu of a meeting which are solicited by the Company) or otherwise take any action in the nature of a vote with respect to Voting Securities except at a meeting of the shareholders of the Company; or (i) call, or join with others in calling, any special meeting of the Company's shareholders. 4. Covenants of the Pacholder Group. Each member of the Pacholder Group hereby covenants and agrees that: (a) no member of the Pacholder Group will, directly or indirectly, bring or maintain or request or cause to be brought or maintained, or encourage, solicit or assist any third party to bring or maintain, or provide to or discuss with any third party any information respecting any basis for, any claim, action, cause of action, proceeding, or suit against any of the Released TSP Parties (as defined below) arising out of or in connection with the actions of TSP in its capacity as a shareholder of the Company or the actions or omissions of any member of TSP as an officer, director, employee or shareholder of the Company or its subsidiaries (the "TSP Actions") (other than arising out of a breach of this Agreement or the transactions contemplated herein) except as may be otherwise required by applicable law; and (b) each member of the Pacholder Group, on all matters for which Voting Securities are entitled to vote, either will vote or cause to be voted all of such member's respective Voting Securities as recommended by the Board of Directors of the Company or will abstain from voting, and cause not to be voted, such securities; provided, however, that no provision of this Section 4(b) will apply to PAI. 5. Representation, Warranty and Covenant of TSP. (a) TSP hereby represents and warrants that as of the Effective Date no member of TSP, other than Global Undervalued Securities Master Fund, L.P., beneficially owns shares of common stock of the Company. (b) TSP hereby covenants and agrees that it will not, directly or indirectly, bring or maintain or request or cause to be brought or maintained, or encourage, solicit or assist any third party to bring or maintain, or provide to or discuss with any third party any information respecting any basis for, any claim, action, cause of action, proceeding, or suit against any of the Released Pacholder E-9-3 Parties (as defined below) arising out of or in connection with any actions or omissions of any member of the Pacholder Group in its capacity as an officer, director, employee or shareholder of the Company or its subsidiaries (the "Pacholder Actions") (other than arising out of a breach of this Agreement or the transactions contemplated herein) except as may be otherwise required by applicable law. 6. Release. (a) In consideration of the covenants and agreements of the members of the Pacholder Group herein, TSP, for itself, in its capacity as a shareholder of the Company, and for its respective members, officers, employees, affiliates, agents, legal representatives, successors and assigns (with TSP, the "TSP Parties"), hereby releases and forever discharges each member of the Pacholder Group and each of his or her respective affiliates, heirs, agents, legal representatives, successors and assigns (with each member of the Pacholder Group, the "Released Pacholder Parties"), of and from any and all debts, demands, actions, causes of action, suits, proceedings, agreements, contracts, judgments, damages, accounts, reckonings, executions, claims and liabilities whatsoever of every name and nature, whether known or unknown, whether or not founded in fact or in law, and whether in law or equity or otherwise, which any of the TSP Parties ever had, now has, or can, shall or may have for or by reason of any matter, cause or anything whatsoever related to any Pacholder Actions on or prior to the Effective Date (other than arising out of a breach of this Agreement or the transactions contemplated thereby). (b) In consideration of the covenants and agreements of TSP herein, each member of the Pacholder Group, for himself or herself or itself and for his or her or its shareholders, officers, employees, respective affiliates, heirs, agents, legal representatives, successors and assigns (the "Pacholder Parties"), hereby releases and forever discharges TSP and each of its respective affiliates, members, managers, officers, employees, agents, legal representatives, successors and assigns (with TSP, the "Released TSP Parties"), of and from any and all debts, demands, actions, causes of action, suits, proceedings, agreements, contracts, judgments, damages, accounts, reckonings, executions, claims and liabilities whatsoever of every name and nature, whether known or unknown, whether or not founded in fact or in law, and whether in law or equity or otherwise, which any of the Pacholder Parties ever had, now has or can, shall or may have for or by reason of any matter, cause or anything whatsoever related to any TSP Actions on or prior to the Effective Date (other than arising out of a breach of this Agreement or the transactions contemplated thereby). 7. Reservation of Rights. Notwithstanding the foregoing, each of the parties hereto agrees that nothing in this Agreement shall in any way release any party from its obligations and requirements, nor waive any party's rights, pursuant to this Agreement. 8. Specific Enforcement; Other Remedies. Notwithstanding the foregoing, each of the parties hereto acknowledges and agrees that the other would be irreparably damaged in the event any of the provisions of this Agreement were not performed in accordance with its specific terms or were otherwise breached. It is accordingly agreed that the non-breaching party shall be entitled to an injunction or injunctions to prevent breaches of the provisions of this Agreement and to enforce specifically the terms and E-9-4 provisions hereof in any court of the United States or any state thereof having jurisdiction, in addition to any other remedy to which such non-breaching party may be entitled at law or equity. 9. Notices. All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be given by personal delivery, facsimile or by mail (registered or certified mail, postage prepaid, return receipt requested) to the respective parties as follows: If to any member of the Pacholder Group other than to PAI, to such member as follows: Robin E. Pacholder or David M. Gerst 11455 Clover Avenue Los Angeles, California 90066 Dr. Asher O. and Sylvia A. Pacholder 3435 Westheimer, No. 1414 Houston, Texas 77027 Tom D. Pacholder 2022 Augusta Houston, Texas 77057 in each case with a copy to: Mayor, Day, Caldwell & Keeton, L.L.P. 700 Louisiana, Suite 1900 Houston, Texas 77002 Telecopy No.: (713) 225-7047 Attention: Diana Hudson If to PAI: Pacholder Associates, Inc. 8044 Montgomery Road, Suite 480 Cincinnati, Ohio 45236 Facsimile No.: (513) 985-3217 Attention: James P. Shanahan, Jr. If to TSP: Travis Street Partners, LLC 910 Travis Street, Suite 2150 Houston, Texas 77002 Facsimile No.: (713) 759-2040 Attention: Christopher N. O'Sullivan E-9-5 with a copy to: Weil, Gotshal & Manges LLP 700 Louisiana, Suite 1600 Houston, Texas 77002 Facsimile No.: (713) 224-9511 Attention: Steven D. Rubin, Esq. or to such other address as any party to this Agreement shall specify by notice to the other party, and shall be deemed to have been given when received. 10. Severability. In case any provision in this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. 11. Descriptive Headings. Descriptive headings are for convenience only and shall not control or affect the meaning or construction of any provision of this Agreement. 12. Counterparts. For the convenience of the parties, any number of counterparts of this Agreement may be executed by either party hereto and each such executed counterpart shall be deemed to be, and shall be, an original instrument. 13. Successors and Assigns. Except as provided herein, this Agreement shall be binding upon and inure to the benefit of and be enforceable by the heirs, personal representatives, successors and assigns of the parties hereto. 14. Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Texas. 15. Amendment, Etc. This Agreement may not be amended, modified or supplemented except upon the execution and delivery of a written agreement executed by TSP and each member of the Pacholder Group. 16. Entire Agreement. This Agreement contains the entire understanding of the parties hereto with respect to the subject matter hereof and supersedes all prior or contemporaneous understandings, oral or written, between the parties hereto with respect to the subject matter hereof. E-9-6 IN WITNESS WHEREOF, the undersigned have caused this Agreement to be duly executed on the day and year first above written. TRAVIS STREET PARTNERS, LLC By: /s/ Christopher N. O'Sullivan --------------------------------------- Name: Christopher N. O'Sullivan Title: Manager By: /s/ Timothy J. Gollin --------------------------------------- Name: Timothy J. Gollin Title: Manager /s/ Asher O. Pacholder ------------------------------------------- Asher O. Pacholder /s/ Sylvia A. Pacholder ------------------------------------------- Sylvia A. Pacholder /s/ Robin E. Pacholder ------------------------------------------- Robin E. Pacholder /s/ Tom D. Pacholder ------------------------------------------- Tom D. Pacholder /s/ David M. Gerst ------------------------------------------- David M. Gerst E-9-7 PACHOLDER ASSOCIATES, INC. By: /s/ Asher O. Pacholder -------------------------------------- Name: Asher O. Pacholder Title: President E-9-8 EX-99.2 3 dex992.txt ASHER PACHOLDER TERMINATION AGREEMENT EXHIBIT 2 TERMINATION AGREEMENT THIS TERMINATION AGREEMENT is made and entered into by and between Asher O. Pacholder (hereinafter referred to as "Employee") and ICO, Inc. (hereinafter referred to as the "Company"). WITNESSETH: WHEREAS, the Company and Employee are parties to an employment agreement dated April 1, 1995 and amended by amendments dated June 14, 1996, February 7, 1997 and September 4, 1998 (as amended, the "Employment Agreement"); and WHEREAS, the Company desires to terminate Employee's employment by and position as an officer of the Company and Employee has consented to such termination; and WHEREAS, the termination of Employee's employment is being effected by mutual agreement of Employee and the Company and is not intended to constitute termination for "Cause" as defined in the Employment Agreement; and WHEREAS, Employee is willing to resign as a director of the Company and as a member of any committees of the Board of Directors of the Company and from all other positions with the Company's subsidiaries and affiliates and the Company is willing to accept such resignation; and WHEREAS, Employee and the Company desire to modify certain of their obligations in connection with such termination of employment from those set forth in the Employment Agreement; and WHEREAS, Employee and the Company mutually desire to avoid and resolve any and all actual and potential differences between them; NOW, THEREFORE, in consideration of the premises and mutual promises herein contained, it is mutually agreed as follows: FIRST: The Company hereby terminates Employee as an employee (including as Chairman of the Board and Chief Financial Officer of the Company) effective immediately, and Employee hereby consents to such termination. In addition, Employee hereby tenders, and the Company hereby accepts, Employee's immediate resignation as a director of the Company and from membership on all committees thereof and from all offices, directorships and committee memberships of any and all subsidiaries and affiliates of the Company and all committees thereof; provided, however, that nothing herein will require resignation from any office, directorship or other position, if any, held in Pacholder Associates, Inc. or the Pacholder High Yield Fund. SECOND: In any and all press releases and other public communications made by either party, the stated reason for Employee's termination as an employee and officer and resignation as a director shall be the desire of Employee and the Company to avoid conflict among the members of the Company's board of directors; provided, however, that neither the making of such statements nor Employee's termination are to be construed as meaning or suggesting that Employee has been terminated for reason of his age. Employee shall be afforded the opportunity to review and comment on any press release with respect to this Termination Agreement or his termination of employment at least one day in advance of the actual release thereof. The Company and Employee hereby agree not to make any disparaging or intentionally false or misleading statements (or encourage others to make any such statements) regarding the other. The preceding sentence shall not apply to any statements required to be made by applicable law or to avoid perjury. -2- THIRD: The Company acknowledges and agrees that Employee's termination of employment is not as a result of Disability and is not intended to be as a result of any action that would constitute Cause (as such terms are defined in the Employment Agreement). Notwithstanding the terms of Section 6(d)(i) of the Employment Agreement (which if applied would result in a substantially higher payment), as consideration for Employee's termination the Company shall pay Employee at the time of execution of this Termination Agreement by Employee the Termination Amounts set forth on Annex A attached hereto (subject to applicable withholding) by wire transfer of immediately available funds. Employee also shall be entitled to the other rights and benefits under the Employment Agreement arising or due as a result of the termination of his employment other than for Cause or Disability (as defined in the Employment Agreement) and shall be subject to his continuing obligations thereunder. For purposes of the application of Section 9 of the Employment Agreement and calculation of the Gross-Up Payment, Employee hereby represents and warrants that his "base amount," within the meaning of Section 280G(b)(3) as calculated in accordance with Section 280(G) of the Internal Revenue Code of 1986, as amended, is the amount reflected as the "base amount" on Annex A attached hereto. The Company and Employee have agreed that the value of any "parachute payments," within the meaning of Section 280G(b)(2) paid or payable to Employee pursuant to this Termination Agreement, the Employment Agreement (as modified hereby) or otherwise, excluding the Principal Severance Payment (as reflected on Annex A) and the Gross-Up Payment will be the "Parachute Payment Value" as set forth on Annex A. Employee has agreed to such value for purposes of the determination of the Gross-Up Payment under Section 9 of the Employment Agreement. Employee agrees that, for purposes of such calculation, in addition to the tax imposed under Section 280G, the parties shall assume that -3- Employee pays and will pay a combined federal, state and local tax rate of 39%. The Company and Employee have agreed in a separate Escrow Agreement entered into in connection with this Agreement to escrow certain monies to be available to Employee if the Gross-Up Payment is hereafter required to be paid. In addition to the lump sum payment provided for above, the Company shall transfer to Employee ownership of the Company car he is currently using, his office computer, telecopy machine, printer and mobile phone and the professional books acquired by the Company for Employee's use all as more particularly described on Annex B attached hereto, in each case free and clear of any liens or other encumbrances. Employee and his spouse shall also be entitled, at no cost to them, to reasonable access and use of the Company's leased apartment in London, England for a period of six months after the date hereof in order to permit Employee to arrange for and move his personal possessions therefrom and wind-up his personal affairs in that area. The Company may withhold from any amounts payable under this Termination Agreement such federal, state and local taxes as shall be required to be withheld pursuant to any applicable law or regulation. FOURTH: The Company acknowledges and agrees that Employee is and will continue to be entitled to indemnification as provided in the Company's bylaws and that no amendment of such bylaws after the date hereof will be effective as applied to Employee if it would adversely affect his rights to indemnification. The Company also acknowledges and agrees that it is not aware of any fact or circumstance that would disqualify Employee from satisfying the requirements necessary to permit the Company's indemnification of Employee as set forth in the Texas Business Corporation Act. The Company also agrees, for a period of five years following the date hereof, to use commercially reasonable best efforts to maintain directors and officers -4- liability insurance providing coverage substantially the same as or better than that currently maintained by the Company; provided that if the cost of maintaining such insurance would exceed twice the cost currently being incurred by the Company therefor, the Company shall only be required to maintain directors and officers liability insurance providing the maximum coverage that can be obtained for a cost that is twice the amount currently being incurred. FIFTH: In consideration of the payments and agreements contained in this Termination Agreement, and with the exception of rights created by or pursuant to this Termination Agreement or the Employment Agreement (as modified hereby), Employee, on his own behalf and on behalf of his affiliates, agents, legal representatives, heirs, successors and assigns (the "Employee Parties"), does hereby fully and forever release, acquit, forgive and forever discharge the Company and its subsidiaries, affiliates, directors, officers, agents, legal representatives, successors and assigns (the "Company Parties") from any and all claims, demands and causes of action whatsoever, of every name, nature of description, whether arising out of contract, tort or otherwise and whether based on common law, statute or administrative regulation, and whether known or unknown, which Employee now has or might have, in any way relating to Employee's service or capacity as a director or officer of, or his employment by, the Company or any subsidiary or affiliate of the Company. Without in any way limiting the foregoing, Employee waives and releases the Company and its subsidiaries and affiliates from any claims that Employee could assert, known or unknown, in connection with Section 6(d)(i) of the Employment Agreement, and acknowledges that this Termination Agreement extinguishes and replaces Section 6(d)(i) of the Employment Agreement with the provisions of this Termination Agreement. In addition, the Employee hereby renounces, effective as of the date hereof, all of the Employee's respective rights, in whatever capacity (whether personal or as an officer or -5- director of the Company or its subsidiaries or affiliates), granted under any proxy or agreement (including, without limitation, under the proxies granted by Messrs. Jack Cave, Raymond J. Dixon, Jr., Joe L. Moore, Eddie R. Johnson, Max W. Kloesel and Carol C. Munn) to vote any shares of common stock of the Company held by other persons, and shall take all such further actions as the Company may reasonably request from time to time to evidence such renunciation of, or to cause such voting rights to be revested in the persons of the grantors under, such proxies or agreements. SIXTH: In consideration of the mutual promises and agreements contained in this Termination Agreement, and with the exception of rights created by or pursuant to this Termination Agreement and the Employment Agreement (as modified hereby), the Company, on its own behalf and on behalf of the other Company Parties, does hereby fully and forever release, acquit, forgive and discharge Employee and the other Employee Parties from any and all claims, demands and causes of action whatsoever, of every name, nature of description, whether arising out of contract, tort or otherwise and whether based on common law, statute or administrative regulation, and, whether known or unknown, which the Company or any Company Party now has or might have, in any way relating to Employee's service or capacity as a director or officer of, or his employment by, the Company or any of its subsidiaries or affiliates or the termination of any such service or employment. SEVENTH: (a) Each party hereto agrees that, following execution of this Termination Agreement, such party will not disclose the terms hereof, to any other person, except in the case where, and only to the extent that, there is a bona fide need for such disclosure to a third party, such as in connection with obtaining advice or furnishing personal financial information, and, in -6- each such case, only on the condition that such other person keeps such information strictly confidential. The foregoing obligations of confidentiality shall not apply to information that is required to be disclosed as a result of any applicable law, rule or regulation of any governmental authority or any court. (b) Employee agrees that he will keep confidential and will not, directly or indirectly, use for himself or use for, or disclose to, any person, any confidential or proprietary information, data or technology regarding the business or operations of the Company, or any subsidiary or affiliate of the Company including, without limitation, any strategy, information, data or technology regarding costs, uses, methods, applications, customers, accounts, suppliers, apparatus, process, system, or other method at any time used, developed or investigated by or for the Company, or any subsidiary or affiliate of the Company, whether or not invented, developed, acquired, discovered or investigated by Employee. The foregoing disclosure restrictions shall not apply when disclosure is required of Employee pursuant to a subpoena or order issued by a court or governmental agency of competent jurisdiction, provided that detailed notice of such subpoena or order is first given to the Company so to provide the Company a reasonable opportunity to challenge or object to such subpoena or order and in no event will Employee be permitted to provide copies of written documentation pertaining to the Company to any third party. Furthermore, Employee agrees to utilize and assert any and all applicable privileges regarding any requested disclosure respecting the Company. The provisions of this subsection (b) supercede the confidentiality covenant contained in Article 10 of the Employment Agreement. (c) Employee shall immediately deliver and return to the Company all books, records, memoranda, plans, computer discs (and transcripts or copies thereof), correspondence, -7- studies and reports, operating projections, trade secrets, customer lists and other documents of any kind and character relating to the Company, its subsidiaries or its affiliates or their respective business operations made or compiled by, delivered to, or otherwise acquired by Employee. (d) Except with the express prior written consent of the Company which may be withheld in the Company's sole discretion, Employee will not retain any copies of all or any portion of the information or data referenced in subsections (b) and (c) above. (e) Except as otherwise provided in the third paragraph of Section THIRD above, Employee agrees to immediately return all other Company property under his possession or control, including, without limitation, all Company identification, parking cards, access cards, travel authority cards, keys and credit cards to the Company. EIGHTH: Employee will not, directly or indirectly, whether for his own account or for the account of any other person: (a) for a period of two years following the date hereof, do anything which would interfere with or divert from the Company any trade, business or business opportunity with (i) any individual or entity with whom Employee has had any contact or association during his tenure with the Company or its subsidiaries or affiliates or (ii) any individual or entity whose identity was confidential and learned by Employee while an employee or officer or director of the Company or its subsidiaries or affiliates providing nothing herein shall limit the application of Section SEVENTH above; (b) for a period of two years following the date hereof, either for himself or as an investor, director, officer, principal, agent, employee, advisor, partner, or in any corporate, individual or representative capacity, solicit, induce or attempt to induce any individual -8- employed by the Company or one of its subsidiaries or affiliates to leave the employment of the Company or such subsidiary or affiliate; (c) for a period of two years following the date hereof, engage in or carry on, directly or indirectly, either for himself or as a member of a partnership or as a stockholder or a equity holder (except as a stockholder of less than one percent (1%) of the issued and outstanding stock of a publicly-held corporation), investor, officer, or director of a corporation or other entity or as an employee, agent, associate or consultant of any person, partnership, corporation or other entity, any business which is in competition with the business of the Company or its subsidiaries or affiliates as conducted on or contemplated as of the date hereof; or (d) do anything that could reasonably be expected to harm the relationship enjoyed by the Company or its affiliates with any individual (including any employee or officer of the Company or its affiliates) or entity who or which has provided financing, equipment, materials, supplies and/or services to the Company or its subsidiaries or affiliates prior to the date hereof. NINTH: Employee shall on or prior to the effective date of this Agreement, submit all actual, reasonable and customary expenses theretofore incurred by Employee in the course of Employee's employment with proper documentation, which, upon verification, the Company shall reimburse promptly in accordance with the Company's reimbursement policy. Employee acknowledges and agrees that Employee has not and has no authority to incur any expenses after the date Employee executes this Agreement, and further agrees that, notwithstanding the provisions of the Employment Agreement, the Company shall have no obligation to reimburse expenses not submitted within the time set forth above or incurred after the date hereof. TENTH: Employee understands and acknowledges that he: -9- (i) has received and has read this Termination Agreement; (ii) is fully informed of and fully understands the terms and meaning of the terms, conditions and effect of signing this Termination Agreement; (iii) has had ample opportunity to ask questions of Company personnel and that the Company advised him and hereby advises him in writing to consult with an attorney of his choice prior to executing this Termination Agreement; (iv) has relied solely on his own judgment and on the advice of such counselors and advisors with whom he has considered it appropriate, desirable, or necessary to consult in making the decision to sign this Termination Agreement, and Employee represents and acknowledges that in executing this Termination Agreement he does not rely and has not relied upon any representation or statement made by the Company, or by any of the Company's agents, shareholders, directors, attorneys, or representatives with regard to the subject matter, basis, or effect of this Termination Agreement or otherwise, other than those specifically stated in this written Termination Agreement; (v) has made his decision voluntarily without any pressure from the Company or its employees either to accept or reject this Termination Agreement; (vi) had twenty-one days to consider this Termination Agreement if he chose to do so, and that no one hurried him into executing this Termination Agreement during that 21-day period, or otherwise coerced him into executing this Termination Agreement; (vii) has seven days following his execution of this Termination Agreement to revoke such acceptance; (viii) must make any such revocation of his prior acceptance of this Termination Agreement in writing and cause such revocation, together with a cashier's check in the amount of the lump sum payment received by him pursuant to Section THIRD, to be delivered to the Company at 11490 Westheimer, Suite 1000, Houston, Texas 77077; (ix) he fully understands that he is, through this Termination Agreement, releasing the Company from any and all claims he may have against the Company and the other parties specified in Section FIFTH, and that this Termination Agreement constitutes a release and discharge of claims arising under the 29 U.S.C. Sections 621-634, including the Older Workers' Benefit Protection Act, 29 U.S.C. Sections 626(f); and (x) he acknowledges that, because he has waived his rights under Sections 6(d)(i) of the Employment Agreement, the payments and other benefits that he will receive in accordance with Section THIRD of this Termination -10- Agreement constitutes something of value to which Employee would not be entitled to receive if he did not agree to give the Company a release of claims. ELEVENTH: If within seven days following Employee's acceptance of this Termination Agreement, Employee revokes such acceptance in accordance with clauses (vii) and (viii) of Section TENTH, then all of the rights and obligations of the parties hereunder shall be deemed rescinded and the parties shall be restored to their respective positions, offices, rights and obligations as they existed immediately prior to execution of this Termination Agreement. TWELFTH: This Termination Agreement is made and entered into in the State of Texas, and, except to the extent that federal law controls the interpretation or enforceability of any provision in this Termination Agreement in which case any such provision shall be construed and enforced in accordance with federal law, shall in all respects be interpreted, enforced and governed under the laws of the State of Texas. The language of all parts of this Termination Agreement shall in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any of the parties. Any claim or controversy of whatever nature arising from or relating in any way to this Termination Agreement, the Employment Agreement, the employment relationship between the Company and Employee or the cessation of such relationship, including disputes arising under the common law or federal or state statutes, laws or regulations and disputes with respect to the arbitrability of any claim or controversy, shall be resolved exclusively by final and binding arbitration before a single experienced employment arbitrator selected in accordance with the Employment Dispute Resolution ("EDR") Rules of the American Arbitration Association ("AAA") unless the parties hereto shall agree otherwise in writing. The arbitration will be conducted in Houston, Texas (or in such other place as may be mutually agreed by the parties) pursuant to the EDR Rules of the AAA, and the arbitrator shall -11- have full authority to award or grant all remedies provided by law. The judgment upon the award may be enforced by any court having jurisdiction thereof. Each party shall pay the fees of their respective attorneys, the expenses of their witnesses, and any other expenses incurred by such party in connection with the arbitration; provided, however, that the Company shall pay for the fees of the arbitrator and the administrative and filing fees charged by the AAA. THIRTEENTH: Should any provision of this Termination Agreement be declared or be determined by any court to be unenforceable or invalid as drafted, it may and shall be reformed or modified by a court of competent jurisdiction to the form of an enforceable and valid provision that achieves, to the greatest extent possible, the result intended by the parties in drafting and agreeing to the unenforceable and invalid provision. Should a court of competent jurisdiction decline to so reform or modify such a provision or determine that no enforceable and valid provision can be created to achieve the intended result, the unenforceability and invalidity of the remaining parts, terms or provisions of this Termination Agreement shall not be affected thereby and said unenforceable or invalid part, term, or provision shall be deemed not to be a part of this Termination Agreement. FOURTEENTH: This Termination Agreement, together with the Employment Agreement (as modified hereby) and the Escrow Agreement, set forth the entire agreement between the parties hereto, and supersede any and all other prior agreements or understanding between the parties hereto pertaining to the subject matter hereof. This Termination Agreement shall be binding on and inure to the benefit of the Company and its successors and assigns, and, in the event of Employee's death or incapacity, shall inure to the benefit of Employee's estate or other legal representatives. -12- FIFTEENTH: Employee and the Company acknowledge and agree that it was not the intention of the Company or Employee that the terms of that certain Willoughby Incentive Stockholders Agreement, dated effective as of April 30, 1996, as amended (the "ICO/Willoughby Agreement") would trigger the provisions of the Rights Agreement between ICO, Inc. and Harris Trust & Savings Bank dated April 1, 1998 or any prior rights agreements of the Company (collectively the "Rights Plans"). Accordingly, the Company and Employee agree, from and after the date hereof, not to maintain or assert any position that the Rights Plan was triggered as a result of the execution of the ICO/Willoughby Agreement. Furthermore, Employee agrees if requested by the Company to enter into such reasonable documentation as may be required, if any, to reflect the prior intent of the parties that the Rights Plan was not to be triggered as a result of the ICO/Willoughby Agreement. -13- EXECUTED on the 6th day of June, 2001, but effective as of 12:01 a.m. (central time) on the 7th day of June, 2001. ICO, INC. By: /s/ JON C. BIRO ----------------------------------------- Name: Jon C. Biro --------------------------------------- Title: Senior Vice President, -------------------------------------- Chief Accounting and Treasurer -------------------------------------- /s/ ASHER O. PACHOLDER --------------------------------------- ASHER O. PACHOLDER -14- ANNEX A TO TERMINATION AGREEMENT (A. Pacholder) I. TERMINATION PAYMENTS: Principal Severance Payment: $ 2,402,877 Legal Fees and Related Expenses: $ 45,077 Accrued Unpaid Vacation $ 26,154 II. GROSS-UP PAYMENT COMPONENTS: Base Amount: $ 386,344 Parachute Payment Value: $ 86,378 III. POTENTIAL GROSS-UP PAYMENT: $ 1,079,800 ANNEX B TO TERMINATION AGREEMENT (A. Pacholder) Car: 1996 Jaguar XJ-S Office computer: Dell laptop Telecopy machine: Hewlett Packard Printer: Hewlett Packard inkjet Mobile Phone: Nokia digital Professional Books: Various financial publications as agreed between the Company and A. Pacholder EX-99.3 4 dex993.txt SYLVIA PACHOLDER TERMINATION AGREEMENT EXHIBIT 3 TERMINATION AGREEMENT THIS TERMINATION AGREEMENT is made and entered into by and between Sylvia A. Pacholder (hereinafter referred to as "Employee") and ICO, Inc. (hereinafter referred to as the "Company"). WITNESSETH: WHEREAS, the Company and Employee are parties to an employment agreement dated April 1, 1995 and amended by amendments dated June 14, 1996, February 7, 1997 and September 4, 1998 (as amended, the "Employment Agreement"); and WHEREAS, the Company desires to terminate Employee's employment by and position as an officer of the Company and Employee has consented to such termination; and WHEREAS, the termination of Employee's employment is being effected by mutual agreement of Employee and the Company and is not intended to constitute termination for "Cause" as defined in the Employment Agreement; and WHEREAS, Employee is willing to resign as a director of the Company and as a member of any committees of the Board of Directors of the Company and from all other positions with the Company's subsidiaries and affiliates and the Company is willing to accept such resignation; and WHEREAS, Employee and the Company desire to modify certain of their obligations in connection with such termination of employment from those set forth in the Employment Agreement; and WHEREAS, Employee and the Company mutually desire to avoid and resolve any and all actual and potential differences between them; NOW, THEREFORE, in consideration of the premises and mutual promises herein contained, it is mutually agreed as follows: FIRST: The Company hereby terminates Employee as an employee (including as President and Chief Executive Officer) of the Company, effective immediately, and Employee hereby consents to such termination. In addition, Employee hereby tenders, and the Company hereby accepts, Employee's immediate resignation as a director of the Company and from membership on all committees thereof and from all offices, directorships and committee memberships of any and all subsidiaries and affiliates of the Company and all committees thereof; provided, however, that nothing herein will require resignation from any office, directorship or positions, if any, held in Pacholder Associates, Inc. or the Pacholder High Yield Fund. SECOND: In any and all press releases and other public communications made by either party, the stated reason for Employee's termination as an employee and officer and resignation as a director shall be the desire of Employee and the Company to avoid conflict among the members of the Company's board of directors; provided, however, that neither the making of such statements nor Employee's termination are to be construed as meaning or suggesting that Employee has been terminated for reason of her age. Employee shall be afforded the opportunity to review and comment on any press release with respect to this Termination Agreement or her termination of employment at least one day in advance of the actual release thereof. The Company and Employee hereby agree not to make any disparaging or intentionally false or misleading statements (or encourage others to make any such statements) regarding the other. The preceding sentence shall not apply to any statements required to be made by applicable law or to avoid perjury. -2- THIRD: The Company acknowledges and agrees that Employee's termination of employment is not as a result of Disability and is not intended to be as a result of any action that would constitute Cause (as such terms are defined in the Employment Agreement). Notwithstanding the terms of Section 6(d)(i) of the Employment Agreement (which if applied would result in a substantially higher payment), as consideration for Employee's termination the Company shall pay Employee at the time of execution of this Termination Agreement by Employee the Termination Amounts set forth on Annex A attached hereto (subject to applicable withholding) by wire transfer of immediately available funds. Employee also shall be entitled to the other rights and benefits under the Employment Agreement (including but not limited to those set forth in Section 9) arising or due as a result of the termination of her employment other than for Cause or Disability (as defined in the Employment Agreement) and shall be subject to her continuing obligations thereunder. For purposes of the application of Section 9 of the Employment Agreement and calculation of the Gross-Up Payment, Employee hereby represents and warrants that her "base amount," within the meaning of Section 280G(b)(3) as calculated in accordance with Section 280(G) of the Internal Revenue Code of 1986, as amended, is the amount reflected as the "base amount" on Annex A attached hereto. The Company and Employee have agreed that the value of any "parachute payments," within the meaning of Section 280G(b)(2) paid or payable to Employee pursuant to this Termination Agreement, the Employment Agreement (as modified hereby) or otherwise, excluding the Principal Severance Payment (as reflected on Annex A) and the Gross-Up Payment will be the "Parachute Payment Value" set forth on Annex A. Employee has agreed to such value for purposes of the initial determination of the Gross-Up Payment under Section 9 of the Employment Agreement. Employee agrees that, for purposes of such calculation, in addition -3- to the tax imposed under Section 280G, the parties shall assume that Employee pays and will pay a combined federal, state and local tax rate of 39%. The Company and Employee have agreed in a separate Escrow Agreement entered into in connection with this Agreement to escrow certain monies to be available to Employee if the Gross-Up Payment is hereafter required to be paid. In addition to the lump sum payment provided for above, the Company shall transfer to Employee ownership of the Company car she is currently using, her office computer, telecopy machine, printer and mobile phone and the professional books acquired by the Company for Employee's use all as more particularly described on Annex b attached hereto, in each case free and clear of any liens or other encumbrances. Employee and her spouse shall also be entitled, at no cost to them, to reasonable access and use of the Company's leased apartment in London, England for a period of six months after the date hereof in order to permit Employee to arrange for and move her personal possessions therefrom and wind-up her personal affairs in that area. The Company may withhold from any amounts payable under this Termination Agreement such federal, state and local taxes as shall be required to be withheld pursuant to any applicable law or regulation. FOURTH: The Company acknowledges and agrees that Employee is and will continue to be entitled to indemnification as provided in the Company's bylaws and that no amendment of such bylaws after the date hereof will be effective as applied to Employee if it would adversely affect her rights to indemnification. The Company also acknowledges and agrees that it is not aware of any fact or circumstance that would disqualify Employee from satisfying the requirements necessary to permit the Company's indemnification of Employee as set forth in the Texas Business Corporation Act. The Company also agrees, for a period of five years following the date hereof, to use commercially reasonable best efforts to maintain directors and officers -4- liability insurance providing coverage substantially the same as or better than that currently maintained by the Company; provided that if the cost of maintaining such insurance would exceed twice the cost currently being incurred by the Company therefor, the Company shall only be required to maintain directors and officers liability insurance providing the maximum coverage that can be obtained for a cost that is twice the amount currently being incurred. FIFTH: In consideration of the payments and agreements contained in this Termination Agreement, and with the exception of rights created by or pursuant to this Termination Agreement or the Employment Agreement (as modified hereby), Employee, on her own behalf and on behalf of her affiliates, agents, legal representatives, heirs, successors and assigns (the "Employee Parties"), does hereby fully and forever release, acquit, forgive and forever discharge the Company and its subsidiaries, affiliates, directors, officers, agents, legal representatives, successors and assigns (the "Company Parties") from any and all claims, demands and causes of action whatsoever, of every name, nature of description, whether arising out of contract, tort or otherwise and whether based on common law, statute or administrative regulation, and whether known or unknown, which Employee now has or might have, in any way relating to Employee's service or capacity as a director or officer of, or her employment by, the Company or any subsidiary or affiliate of the Company. Without in any way limiting the foregoing, Employee waives and releases the Company and its subsidiaries and affiliates from any claims that Employee could assert, known or unknown, in connection with Section 6(d)(i) of the Employment Agreement, and acknowledges that this Termination Agreement extinguishes and replaces Section 6(d)(i) of the Employment Agreement with the provisions of this Termination Agreement. In addition, the Employee hereby renounces, effective as of the date hereof, all of the Employee's respective rights, in whatever capacity (whether personal or as an officer or -5- director of the Company or its subsidiaries or affiliates), granted under any proxy or agreement (including, without limitation, under the proxies granted by Messrs. Jack Cave, Raymond J. Dixon, Jr., Joe L. Moore, Eddie R. Johnson, Max W. Kloesel and Carol C. Munn) to vote any shares of common stock of the Company held by other persons, and shall take all such further actions as the Company may reasonably request from time to time to evidence such renunciation of, or to cause such voting rights to be revested in the persons of the grantors under, such proxies or agreements. SIXTH: In consideration of the mutual promises and agreements contained in this Termination Agreement, and with the exception of rights created by or pursuant to this Termination Agreement and the Employment Agreement (as modified hereby), the Company, on its own behalf and on behalf of the other Company Parties, does hereby fully and forever release, acquit, forgive and discharge Employee and the other Employee Parties from any and all claims, demands and causes of action whatsoever, of every name, nature of description, whether arising out of contract, tort or otherwise and whether based on common law, statute or administrative regulation, and, whether known or unknown, which the Company or any Company Party now has or might have, in any way relating to Employee's service or capacity as a director or officer of, or her employment by, the Company or any of its subsidiaries or affiliates or the termination of any such service or employment. SEVENTH: (a) Each party hereto agrees that, following execution of this Termination Agreement, such party will not disclose the terms hereof, to any other person, except in the case where, and only to the extent that, there is a bona fide need for such disclosure to a third party, such as in connection with obtaining advice or furnishing personal financial information, and, in -6- each such case, only on the condition that such other person keeps such information strictly confidential. The foregoing obligations of confidentiality shall not apply to information that is required to be disclosed as a result of any applicable law, rule or regulation of any governmental authority or any court. (b) Employee agrees that she will keep confidential and will not, directly or indirectly, use for herself or use for, or disclose to, any person, any information, data or technology regarding the business or operations of the Company, or any subsidiary or affiliate of the Company including, without limitation, any strategy, information, data or technology regarding costs, uses, methods, applications, customers, accounts, suppliers, apparatus, process, system, or other method at any time used, developed or investigated by or for the Company, or any subsidiary or affiliate of the Company, whether or not invented, developed, acquired, discovered or investigated by Employee. The foregoing disclosure restrictions shall not apply when disclosure is required of Employee pursuant to a subpoena or order issued by a court or governmental agency of competent jurisdiction, provided that detailed notice of such subpoena or order is first given to the Company so to provide the Company a reasonable opportunity to challenge or object to such subpoena or order and in no event will Employee be permitted to provide copies of written documentation pertaining to the Company to any third party. Furthermore, Employee agrees to utilize and assert any and all applicable privileges regarding any requested disclosure respecting the Company. The provisions of this subsection (b) supercede the confidentiality covenant contained in Article 10 of the Employment Agreement. (c) Employee shall immediately deliver and return to the Company all books, records, memoranda, plans, computer discs (and transcripts or copies thereof), correspondence, studies and reports, operating projections, trade secrets, customer lists and other documents of -7- any kind and character relating to the Company, its subsidiaries or its affiliates or their respective business operations made or compiled by, delivered to, or otherwise acquired by Employee. (d) Except with the express prior written consent of the Company which may be withheld in the Company's sole discretion, Employee will not retain any copies of all or any portion of the information or data referenced in subsections (b) and (c) above. (e) Except as otherwise provided in the third paragraph of Section Third above, Employee agrees to immediately return all other Company property under her possession or control, including, without limitation, all Company identification, parking cards, access cards, travel authority cards, keys and credit cards to the Company. EIGHTH: Employee will not, directly or indirectly, whether for her own account or for the account of any other person: (a) for a period of two years following the date hereof, do anything which would interfere with or divert from the Company any trade, business or business opportunity with (i) any individual or entity with whom Employee has had any contact or association during her tenure with the Company or its subsidiaries or affiliates or (ii) any individual or entity whose identity was confidential and learned by Employee while an employee or officer or director of the Company or its subsidiaries or affiliates provided nothing herein shall limit the application of Section SEVENTH above; (b) for a period of two years following the date hereof, either for herself or as an investor, director, officer, principal, agent, employee, advisor, partner, or in any corporate, individual or representative capacity, solicit, induce or attempt to induce any individual -8- employed by the Company or one of its subsidiaries or affiliates to leave the employment of the Company or such subsidiary or affiliate; (c) for a period of two years following the date hereof, engage in or carry on, directly or indirectly, either for herself or as a member of a partnership or as a stockholder or a equity holder (except as a stockholder of less than one percent (1%) of the issued and outstanding stock of a publicly held corporation), investor, officer, or director of a corporation or other entity or as an employee, agent, associate or consultant of any person, partnership, corporation or other entity, any business which is in competition with the business of the Company or its subsidiaries or affiliates as conducted on or contemplated as of the date hereof; or (d) do anything that could reasonably be expected to harm the relationship enjoyed by the Company or its subsidiaries or affiliates with any individual (including any employee or officer of the Company or its subsidiaries or affiliates) or entity who or which has provided financing, equipment, materials, supplies and/or services to the Company or its subsidiaries or affiliates prior to the date hereof. NINTH: Employee shall on or prior to the effective date of this Agreement, submit all actual, reasonable and customary expenses theretofore incurred by Employee in the course of Employee's employment with proper documentation, which, upon verification, the Company shall reimburse promptly in accordance with the Company's reimbursement policy. Employee acknowledges and agrees that Employee has not and has no authority to incur any expenses after the date Employee executes this Agreement, and further agrees that, notwithstanding any provision of the Employment Agreement, the Company shall have no obligation to reimburse expenses not submitted within the time set forth above or incurred after the date hereof. -9- TENTH: Employee understands and acknowledges that she: (i) has received and has read this Termination Agreement; (ii) is fully informed of and fully understands the terms and meaning of the terms, conditions and effect of signing this Termination Agreement; (iii) has had ample opportunity to ask questions of Company personnel and that the Company advised her and hereby advises her in writing to consult with an attorney of her choice prior to executing this Termination Agreement; (iv) has relied solely on her own judgment and on the advice of such counselors and advisors with whom she has considered it appropriate, desirable, or necessary to consult in making the decision to sign this Termination Agreement, and Employee represents and acknowledges that in executing this Termination Agreement she does not rely and has not relied upon any representation or statement made by the Company, or by any of the Company's agents, shareholders, directors, attorneys, or representatives with regard to the subject matter, basis, or effect of this Termination Agreement or otherwise, other than those specifically stated in this written Termination Agreement; (v) has made her decision voluntarily without any pressure from the Company or its employees either to accept or reject this Termination Agreement; (vi) had twenty-one days to consider this Termination Agreement if she chose to do so, and that no one hurried her into executing this Termination Agreement during that 21-day period, or otherwise coerced her into executing this Termination Agreement; (vii) has seven days following her execution of this Termination Agreement to revoke such acceptance; (viii) must make any such revocation of her prior acceptance of this Termination Agreement in writing and cause such revocation, together with a cashier's check in the amount of the lump sum payment received by her pursuant to Section THIRD, to be delivered to the Company at 11490 Westheimer, Suite 1000, Houston, Texas 77077; (ix) she fully understands that she is, through this Termination Agreement, releasing the Company from any and all claims she may have against the Company and the other parties specified in Section FIFTH, and that this Termination Agreement constitutes a release and discharge of claims arising under the 29 U.S.C. Sections 621-634, including the Older Workers' Benefit Protection Act, 29 U.S.C. Sections 626(f); and -10- (x) she acknowledges that, because she has waived her rights under Sections 6(d)(i) of the Employment Agreement, the payments and other benefits that she will receive in accordance with Section THIRD of this Termination Agreement constitutes something of value to which Employee would not be entitled to receive if she did not agree to give the Company a release of claims. ELEVENTH: If within seven days following Employee's acceptance of this Termination Agreement, Employee revokes such acceptance in accordance with clauses (vii) and (viii) of Section TENTH, then all of the rights and obligations of the parties hereunder shall be deemed rescinded and the parties shall be restored to their respective positions, offices, rights and obligations as they existed immediately prior to execution of this Termination Agreement. TWELFTH: This Termination Agreement is made and entered into in the State of Texas, and, except to the extent that federal law controls the interpretation or enforceability of any provision in this Termination Agreement in which case any such provision shall be construed and enforced in accordance with federal law, shall in all respects be interpreted, enforced and governed under the laws of the State of Texas. The language of all parts of this Termination Agreement shall in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any of the parties. Any claim or controversy of whatever nature arising from or relating in any way to this Termination Agreement, the Employment Agreement, the employment relationship between the Company or any subsidiary or affiliate and Employee or the cessation of such relationship, including disputes arising under the common law or federal or state statutes, laws or regulations and disputes with respect to the arbitrability of any claim or controversy, shall be resolved exclusively by final and binding arbitration before a single experienced employment arbitrator selected in accordance with the Employment Dispute Resolution ("EDR") Rules of the American Arbitration Association ("AAA") unless the parties hereto shall agree otherwise in writing. The arbitration will be conducted in Houston, Texas (or -11- in such other place as may be mutually agreed by the parties) pursuant to the EDR Rules of the AAA, and the arbitrator shall have full authority to award or grant all remedies provided by law. The judgment upon the award may be enforced by any court having jurisdiction thereof. Each party shall pay the fees of their respective attorneys, the expenses of their witnesses, and any other expenses incurred by such party in connection with the arbitration; provided, however, that the Company shall pay for the fees of the arbitrator and the administrative and filing fees charged by the AAA. THIRTEENTH: Should any provision of this Termination Agreement be declared or be determined by any court to be unenforceable or invalid as drafted, it may and shall be reformed or modified by a court of competent jurisdiction to the form of an enforceable and valid provision that achieves, to the greatest extent possible, the result intended by the parties in drafting and agreeing to the unenforceable and invalid provision. Should a court of competent jurisdiction decline to so reform or modify such a provision or determine that no enforceable and valid provision can be created to achieve the intended result, the unenforceability and invalidity of the remaining parts, terms or provisions of this Termination Agreement shall not be affected thereby and said unenforceable or invalid part, term, or provision shall be deemed not to be a part of this Termination Agreement. FOURTEENTH: This Termination Agreement, together with the Employment Agreement (as modified hereby) and the Escrow Agreement, set forth the entire agreement between the parties hereto, and supersede any and all other prior agreements or understanding between the parties hereto pertaining to the subject matter hereof. This Termination Agreement shall be binding on and inure to the benefit of the Company and its successors and assigns, and, -12- in the event of Employee's death or incapacity, shall inure to the benefit of Employee's estate or other legal representatives. FIFTEENTH: Employee and the Company acknowledge and agree that it was not the intention of the Company or Employee that the terms of that certain Willoughby Incentive Stockholders Agreement, dated effective as of April 30, 1996, as amended (the "ICO/Willoughby Agreement") would trigger the provisions of the Rights Agreement between ICO, Inc. and Harris Trust & Savings Bank dated April 1, 1998 or any prior rights agreements of the Company (collectively the "Rights Plans"). Accordingly, the Company and Employee agree, from and after the date hereof, not to maintain or assert any position that the Rights Plan was triggered as a result of the execution of the ICO/Willoughby Agreement. Furthermore, Employee agrees if requested by the Company to enter into such reasonable documentation as may be required, if any, to reflect the prior intent of the parties that the Rights Plan was not to be triggered as a result of the ICO/Willoughby Agreement. -13- EXECUTED on the 6th day of June, 2001, but effective as of 12:01 a.m. (central time) on the 7th day of June, 2001. ICO, INC. By: /s/ JON C. BIRO -------------------------------------- Name: Jon C. Biro ------------------------------------ Title: Senior Vice President, ----------------------------------- Chief Accounting and Treasurer ----------------------------------- /s/ SYLVIA A. PACHOLDER ----------------------------------- SYLVIA A. PACHOLDER -14- ANNEX A TO TERMINATION AGREEMENT (S. Pacholder) I. TERMINATION PAYMENTS: Principal Severance Payment: $ 2,615,068 Legal Fees and Related Expenses: $ 45,077 Accrued Unpaid Vacation $ 29,231 II. GROSS-UP PAYMENT COMPONENTS: Base Amount: $ 418,950 Parachute Payment Value: $ 82,378 III. POTENTIAL GROSS-UP PAYMENT: $ 1,169,960 ANNEX B TO TERMINATION AGREEMENT (S. Pacholder) Car: 1999 Acura 3.2 TL Office computer: Dell laptop Telecopy machine: Hewlett Packard Printer: Hewlett Packard inkjet Mobile Phone: Motorola analog Professional Books: None EX-99.4 5 dex994.txt ROBIN PACHOLDER TERMINATION AGREEMENT EXHIBIT 4 TERMINATION AGREEMENT THIS TERMINATION AGREEMENT is made and entered into by and between Robin E. Pacholder (hereinafter referred to as "Employee") and ICO, Inc. (hereinafter referred to as the "Company"). WITNESSETH: WHEREAS, the Company and Employee are parties to an Amended and Restated Employment Agreement dated September 4, 1998 (as amended, the "Employment Agreement"); and WHEREAS, the Company desires to terminate Employee's employment by and position as an officer of the Company and Employee has consented to such termination; and WHEREAS, the termination of Employee's employment is being effected by mutual agreement of Employee and the Company and is not intended to constitute termination for "Cause" as defined in the Employment Agreement; and WHEREAS, Employee is willing to resign from all other positions with the Company and its subsidiaries (other than those from which she is being terminated) and the Company is willing to accept such resignation; and WHEREAS, Employee and the Company desire to modify certain of their obligations in connection with such termination of employment from those set forth in the Employment Agreement; and WHEREAS, Employee and the Company mutually desire to avoid and resolve any and all actual and potential differences between them; NOW, THEREFORE, in consideration of the premises and mutual promises herein contained, it is mutually agreed as follows: FIRST: The Company hereby terminates Employee as an employee (including as Senior Vice President) of the Company and as an employee (including as President) of Wedco, North America, effective immediately, and Employee hereby consents to such termination. In addition, Employee hereby tenders, and the Company hereby accepts, Employee's immediate resignation from all other offices, directorships and committee memberships of any and all subsidiaries and affiliates of the Company and all committees thereof; provided, however, that nothing herein will require resignation from any office, directorship or positions, if any, held in Pacholder Associates, Inc. or the Pacholder High Yield Fund. SECOND: In any and all press releases and other public communications made by either party, the stated reason for Employee's termination as an employee and officer shall be the desire of Employee and the Company to avoid conflict among the members of the Company's board of directors; provided, however, that neither the making of such statements nor Employee's termination are to be construed as meaning or suggesting that Employee has been terminated for reason of her age. Employee shall be afforded the opportunity to review and comment on any press release with respect to this Termination Agreement or her termination of employment at least one day in advance of the actual release thereof. The Company and Employee hereby agree not to make any disparaging or intentionally false or misleading statements (or encourage others to make any such statements) regarding the other. The preceding sentence shall not apply to any statements required to be made by applicable law or to avoid perjury. THIRD: The Company acknowledges and agrees that Employee's termination of employment is not as a result of Disability and is not intended to be as a result of any action that -2- would constitute Cause (as such terms are defined in the Employment Agreement). Notwithstanding the terms of Section 6(d)(i) of the Employment Agreement (which if applied would result in a substantially higher payment), as consideration for Employee's termination the Company shall pay Employee at the time of execution of this Termination Agreement by Employee the Termination Amounts set forth on Annex A attached hereto (subject to applicable withholding) by wire transfer of immediately available funds. Employee also shall be entitled to the other rights and benefits under the Employment Agreement (including but not limited to those set forth in Section 9) arising or due as a result of the termination of her employment other than for Cause or Disability (as defined in the Employment Agreement) and shall be subject to her continuing obligations thereunder. For purposes of the application of Section 9 of the Employment Agreement and calculation of the Gross-Up Payment, Employee hereby represents and warrants that her "base amount," within the meaning of Section 280G(b)(3) as calculated in accordance with Section 280(G) of the Internal Revenue Code of 1986, as amended, is the amount reflected as the "base amount" on Annex A attached hereto. The Company and Employee have agreed that the value of any "parachute payments," within the meaning of Section 280G(b)(2) paid or payable to Employee pursuant to this Termination Agreement, the Employment Agreement (as modified hereby) or otherwise, excluding the Principal Severance Payment (as reflected on Annex A) and the Gross-Up Payment will be the "Parachute Payment Value" as set forth on Annex A and Employee has agreed to such value for purposes of the initial determination of the Gross-Up Payment under Section 9 of the Employment Agreement. Employee agrees that, for purposes of such calculation, in addition to the tax imposed under Section 280G, the parties shall assume that Employee pays and will pay a combined federal, state and local tax rate of 39%. The Company -3- and Employee have agreed in a separate Escrow Agreement entered into in connection with this Agreement to escrow certain monies to be available to Employee if the Gross-Up Payment is hereafter required to be paid. In addition to the lump sum payment provided for above, the Company shall transfer to Employee ownership of the Company car she is currently using, her office computer, telecopy machine, printer and mobile phone and the professional books acquired by the Company for Employee's use all as more particularly described on Annex B attached hereto, in each case free and clear of any liens or other encumbrances. The Company shall also provide Employee, at the Company's expense, with the services of an out-placement consulting firm for a period of one year provided the costs to the Company in this regard will not exceed $9,000. The Company may withhold from any amounts payable under this Termination Agreement such federal, state and local taxes as shall be required to be withheld pursuant to any applicable law or regulation. FOURTH: The Company acknowledges and agrees that Employee is and will continue to be entitled to indemnification as provided in the Company's bylaws and that no amendment of such bylaws after the date hereof will be effective as applied to Employee if it would adversely affect her rights to indemnification. The Company also acknowledges and agrees that it is not aware of any fact or circumstance that would disqualify Employee from satisfying the requirements necessary to permit the Company's indemnification of Employee as set forth in the Texas Business Corporation Act. The Company also agrees, for a period of five years following the date hereof, to use commercially reasonable best efforts to maintain directors and officers liability insurance providing coverage substantially the same or better as that currently maintained by the Company; provided that if the cost of maintaining such insurance would -4- exceed twice the cost currently being incurred by the Company therefor, the Company shall only be required to maintain directors and officers liability insurance providing the maximum coverage that can be obtained for a cost that is twice the amount currently being incurred. FIFTH: In consideration of the payments and agreements contained in this Termination Agreement, and with the exception of rights created by or pursuant to this Termination Agreement or the Employment Agreement (as modified hereby), Employee, on her own behalf and on behalf of her affiliates, agents, legal representatives, heirs, successors and assigns (the "Employee Parties"), does hereby fully and forever release, acquit, forgive and forever discharge the Company and its subsidiaries, affiliates, directors, officers, agents, legal representatives, successors and assigns (the "Company Parties") from any and all claims, demands and causes of action whatsoever, of every name, nature of description, whether arising out of contract, tort or otherwise and whether based on common law, statute or administrative regulation, and whether known or unknown, which Employee now has or might have, in any way relating to Employee's service or capacity as a director or officer of, or her employment by, the Company or any subsidiary or affiliate of the Company. Without in any way limiting the foregoing, Employee waives and releases the Company and its subsidiaries and affiliates from any claims that Employee could assert, known or unknown, in connection with Section 6(d)(i) of the Employment Agreement, and acknowledges that this Termination Agreement extinguishes and replaces Section 6(d)(i) of the Employment Agreement with the provisions of this Termination Agreement. In addition, the Employee hereby renounces, effective as of the date hereof, all of the Employee's respective rights, in whatever capacity (whether personal or as an officer or director of the Company or any subsidiary or affiliate), granted under any proxy or agreement to vote any shares of common stock of the Company held by other persons, and shall take all such -5- further actions as the Company may reasonably request from time to time to evidence such renunciation of, or to cause such voting rights to be revested in the persons of the grantors under, such proxies or agreements. SIXTH: In consideration of the mutual promises and agreements contained in this Termination Agreement, and with the exception of rights created by or pursuant to this Termination Agreement and the Employment Agreement (as modified hereby), the Company, on its own behalf and on behalf of the other Company Parties, does hereby fully and forever release, acquit, forgive and discharge Employee and the other Employee Parties from any and all claims, demands and causes of action whatsoever, of every name, nature of description, whether arising out of contract, tort or otherwise and whether based on common law, statute or administrative regulation, and, whether known or unknown, which the Company or any Company Party now has or might have, in any way relating to Employee's service or capacity as a director or officer of, or her employment by, the Company or any of its subsidiaries or affiliates or the termination of any such service or employment. SEVENTH: (a) Each party hereto agrees that, following execution of this Termination Agreement, such party will not disclose the terms hereof, to any other person, except in the case where, and only to the extent that, there is a bona fide need for such disclosure to a third party, such as in connection with obtaining advice or furnishing personal financial information, and, in each such case, only on the condition that such other person keeps such information strictly confidential. The foregoing obligations of confidentiality shall not apply to information that is required to be disclosed as a result of any applicable law, rule or regulation of any governmental authority or any court. -6- (b) Employee agrees that she will keep confidential and will not, directly or indirectly, use for himself or use for, or disclose to, any person, any information, data or technology regarding the business or operations of the Company, or any subsidiary or affiliate of the Company including, without limitation, any strategy, information, data or technology regarding costs, uses, methods, applications, customers, accounts, suppliers, apparatus, process, system, or other method at any time used, developed or investigated by or for the Company, or any subsidiary or affiliate of the Company, whether or not invented, developed, acquired, discovered or investigated by Employee. The foregoing disclosure restrictions shall not apply when disclosure is required of Employee pursuant to a subpoena or order issued by a court or governmental agency of competent jurisdiction, provided that detailed notice of such subpoena or order is first given to the Company so to provide the Company a reasonable opportunity to challenge or object to such subpoena or order and in no event will Employee be permitted to provide copies of written documentation pertaining to the Company to any third party. Furthermore, Employee agrees to utilize and assert any and all applicable privileges regarding any requested disclosure respecting the Company. The provisions of this subsection (b) supercede the confidentiality covenant contained in Article 10 of the Employment Agreement. (c) Employee shall immediately deliver and return to the Company all books, records, memoranda, plans, computer discs (and transcripts or copies thereof), correspondence, studies and reports, operating projections, trade secrets, customer lists and other documents of any kind and character relating to the Company, its subsidiaries or its affiliates or their respective business operations made or compiled by, delivered to, or otherwise acquired by Employee. -7- (d) Except with the express prior written consent of the Company which may be withheld in the Company's sole discretion, Employee will not retain any copies of all or any portion of the information or data referenced in subsections (b) and (c) above. (e) Except as otherwise provided in the third paragraph of Section Third above, Employee agrees to immediately return all other Company property under her possession or control, including, without limitation, all Company identification, parking cards, access cards, travel authority cards, keys and credit cards to the Company. EIGHTH: Employee will not, directly or indirectly, whether for her own account or for the account of any other person: (a) for a period of six months following the date hereof, do anything which would interfere with or divert from the Company any trade, business or business opportunity with (i) any individual or entity with whom Employee has had any contact or association during her tenure with the Company or its affiliates or (ii) any individual or entity whose identity was confidential and learned by Employee while an employee or officer of the Company or its subsidiaries or affiliates provided nothing herein shall limit the application of Section SEVENTH above; (b) for a period of two years following the date hereof, either for herself or as an investor, director, officer, principal, agent, employee, advisor, partner, or in any corporate, individual or representative capacity, solicit, induce or attempt to induce any individual employed by the Company or one of its subsidiaries or affiliates to leave the employment of the Company or such subsidiary or affiliate; -8- (c) for a period of six months following the date hereof, engage in or carry on, directly or indirectly, either for herself or as a member of a partnership or as a stockholder or a equity holder (except as a stockholder of less than one percent (1%) of the issued and outstanding stock of a publicly held corporation), investor, officer, or director of a corporation or other entity or as an employee, agent, associate or consultant of any person, partnership, corporation or other entity, any business which is within 150 miles of any office of the Company or its subsidiaries or affiliates and which is in competition with the business of the Wedco segment/division of the Company as conducted on or contemplated as of the date hereof; or (d) do anything that could reasonably be expected to harm the relationship enjoyed by the Company or its affiliates with any individual (including any employee or officer of the Company or its affiliates) or entity who or which has provided financing, equipment, materials, supplies and/or services to the Company or its affiliates prior to the date hereof. NINTH: Employee shall on or prior to the effective date of this Agreement, submit all actual, reasonable and customary expenses theretofore incurred by Employee in the course of Employee's employment with proper documentation, which, upon verification, the Company shall reimburse promptly in accordance with the Company's reimbursement policy. Employee acknowledges and agrees that Employee has not and has no authority to incur any expenses after the date Employee executes this Agreement, and further agrees that, notwithstanding the provisions of the Employment Agreement, the Company shall have no obligation to reimburse expenses not submitted within the time set forth above or incurred after the date hereof. TENTH: Employee understands and acknowledges that she: (i) has received and has read this Termination Agreement; (ii) is fully informed of and fully understands the terms and meaning of the -9- terms, conditions and effect of signing this Termination Agreement; (iii) has had ample opportunity to ask questions of Company personnel and that the Company advised her and hereby advises her in writing to consult with an attorney of her choice prior to executing this Termination Agreement; (iv) has relied solely on her own judgment and on the advice of such counselors and advisors with whom she has considered it appropriate, desirable, or necessary to consult in making the decision to sign this Termination Agreement, and Employee represents and acknowledges that in executing this Termination Agreement she does not rely and has not relied upon any representation or statement made by the Company, or by any of the Company's agents, shareholders, directors, attorneys, or representatives with regard to the subject matter, basis, or effect of this Termination Agreement or otherwise, other than those specifically stated in this written Termination Agreement; (v) has made her decision voluntarily without any pressure from the Company or its employees either to accept or reject this Termination Agreement; (vi) had twenty-one days to consider this Termination Agreement if she chose to do so, and that no one hurried her into executing this Termination Agreement during that 21-day period, or otherwise coerced her into executing this Termination Agreement; (vii) has seven days following her execution of this Termination Agreement to revoke such acceptance; (viii) must make any such revocation of her prior acceptance of this Termination Agreement in writing and cause such revocation, together with a cashier's check in the amount of the lump sum payment received by her pursuant to Section THIRD, to be delivered to the Company at 11490 Westheimer, Suite 1000, Houston, Texas 77077; (ix) she fully understands that she is, through this Termination Agreement, releasing the Company from any and all claims she may have against the Company and the other parties specified in Section FIFTH, and that this Termination Agreement constitutes a release and discharge of claims arising under the 29 U.S.C. Sections 621-634, including the Older Workers' Benefit Protection Act, 29 U.S.C. Sections 626(f); and (x) she acknowledges that, because she has waived her rights under Sections 6(d)(i) of the Employment Agreement, the payments and other benefits that she will receive in accordance with Section THIRD of this Termination Agreement constitutes something of value to which Employee would not be entitled to receive if she did not agree to give the Company a release of claims. -10- ELEVENTH: If within seven days following Employee's acceptance of this Termination Agreement, Employee revokes such acceptance in accordance with clauses (vii) and (viii) of Section TENTH, then all of the rights and obligations of the parties hereunder shall be deemed rescinded and the parties shall be restored to their respective positions, offices, rights and obligations as they existed immediately prior to execution of this Termination Agreement. TWELFTH: This Termination Agreement is made and entered into in the State of Texas, and, except to the extent that federal law controls the interpretation or enforceability of any provision in this Termination Agreement in which case any such provision shall be construed and enforced in accordance with federal law, shall in all respects be interpreted, enforced and governed under the laws of the State of Texas. The language of all parts of this Termination Agreement shall in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any of the parties. Any claim or controversy of whatever nature arising from or relating in any way to this Termination Agreement, the Employment Agreement, the employment relationship between the Company and Employee or the cessation of such relationship, including disputes arising under the common law or federal or state statutes, laws or regulations and disputes with respect to the arbitrability of any claim or controversy, shall be resolved exclusively by final and binding arbitration before a single experienced employment arbitrator selected in accordance with the Employment Dispute Resolution ("EDR") Rules of the American Arbitration Association ("AAA") unless the parties hereto shall agree otherwise in writing. The arbitration will be conducted in Houston, Texas (or in such other place as may be mutually agreed by the parties) pursuant to the EDR Rules of the AAA, and the arbitrator shall have full authority to award or grant all remedies provided by law. The judgment upon the award may be enforced by any court having jurisdiction thereof. Each party shall pay the fees of -11- their respective attorneys, the expenses of their witnesses, and any other expenses incurred by such party in connection with the arbitration; provided, however, that the Company shall pay for the fees of the arbitrator and the administrative and filing fees charged by the AAA. THIRTEENTH: Should any provision of this Termination Agreement be declared or be determined by any court to be unenforceable or invalid as drafted, it may and shall be reformed or modified by a court of competent jurisdiction to the form of an enforceable and valid provision that achieves, to the greatest extent possible, the result intended by the parties in drafting and agreeing to the unenforceable and invalid provision. Should a court of competent jurisdiction decline to so reform or modify such a provision or determine that no enforceable and valid provision can be created to achieve the intended result, the unenforceability and invalidity of the remaining parts, terms or provisions of this Termination Agreement shall not be affected thereby and said unenforceable or invalid part, term, or provision shall be deemed not to be a part of this Termination Agreement. FOURTEENTH: This Termination Agreement, together with the Employment Agreement (as modified hereby) and the Escrow Agreement, set forth the entire agreement between the parties hereto, and supersede any and all other prior agreements or understanding between the parties hereto pertaining to the subject matter hereof. This Termination Agreement shall be binding on and inure to the benefit of the Company and its successors and assigns, and, in the event of Employee's death or incapacity, shall inure to the benefit of Employee's estate or other legal representatives. -12- EXECUTED on the 6th day of June, 2001, but effective as of 12:01 a.m. (central time) on the 7th day of June, 2001. ICO, INC. By: /s/ JON C. BIRO --------------------------------------------- Name: Jon C. Biro ------------------------------------------- Title: Senior Vice President, ------------------------------------------ Chief Accounting and Treasurer ------------------------------------------ /s/ ROBIN E. PACHOLDER ------------------------------------------ ROBIN E. PACHOLDER -13- ANNEX A TO TERMINATION AGREEMENT (R. Pacholder) I. TERMINATION PAYMENTS: Principal Severance Payment: $ 702,205 Legal Fees and Related Expenses: $ 23,213 Accrued Unpaid Vacation $ 16,154 II. GROSS-UP PAYMENT COMPONENTS: Base Amount: $ 154,424 Parachute Payment Value: $ 68,177 III. POTENTIAL GROSS-UP PAYMENT: $ 316,282
ANNEX B TO TERMINATION AGREEMENT (R. Pacholder) Car: 1997 BMW 528i Office computer: Dell laptop Telecopy machine: Brother MSC 4500 ML Printer: Hewlett Packard ink jet Mobile Phone: Nokia digital Professional Books: None EX-99.5 6 dex995.txt DAVID GERST TERMINATION AGREEMENT EXHIBIT 5 TERMINATION AGREEMENT THIS TERMINATION AGREEMENT is made and entered into by and between David M. Gerst (hereinafter referred to as "Employee") and ICO, Inc. (hereinafter referred to as the "Company"). WITNESSETH: WHEREAS, the Company and Employee are parties to an Amended and Restated Employment Agreement dated August 5, 1999 (as amended, the "Employment Agreement"); and WHEREAS, the Company desires to terminate Employee's employment by and position as an officer of the Company and Employee has consented to such termination; and WHEREAS, the termination of Employee's employment is being effected by mutual agreement of Employee and the Company and is not intended to constitute termination for "Cause" as defined in the Employment Agreement; and WHEREAS, Employee is willing to resign from all other positions with the Company and its subsidiaries (other than those from which he is being terminated) and the Company is willing to accept such resignation; and WHEREAS, Employee and the Company desire to modify certain of their obligations in connection with such termination of employment from those set forth in the Employment Agreement; and WHEREAS, Employee and the Company mutually desire to avoid and resolve any and all actual and potential differences between them; NOW, THEREFORE, in consideration of the premises and mutual promises herein contained, it is mutually agreed as follows: FIRST: The Company hereby terminates Employee as an employee (including as Senior Vice President and General Counsel) of the Company, effective immediately, and Employee hereby consents to such termination. In addition, Employee hereby tenders, and the Company hereby accepts, Employee's immediate resignation from all other offices, directorships and committee memberships of any and all subsidiaries and affiliates of the Company and all committees thereof; provided, however, that nothing herein will require resignation from any officer, directorships or positions, if any, held in Pacholder Associates, Inc. or the Pacholder High Yield Fund. SECOND: In any and all press releases and other public communications made by either party, the stated reason for Employee's termination as an employee and officer shall be the desire of Employee and the Company to avoid conflict among the members of the Company's board of directors; provided, however, that neither the making of such statements nor Employee's termination are to be construed as meaning or suggesting that Employee has been terminated for reason of his age. Employee shall be afforded the opportunity to review and comment on any press release with respect to this Termination Agreement or his termination of employment at least one day in advance of the actual release thereof. The Company and Employee hereby agree not to make any disparaging or intentionally false or misleading statements (or encourage others to make any such statements) regarding the other. The preceding sentence shall not apply to any statements required to be made by applicable law or to avoid perjury. THIRD: The Company acknowledges and agrees that Employee's termination of employment is not as a result of Disability and is not intended to be as a result of any action that -2- would constitute Cause (as such terms are defined in the Employment Agreement). Notwithstanding the terms of Section 6(d)(i) of the Employment Agreement (which if applied would result in a substantially higher payment), as consideration for Employee's termination the Company shall pay Employee at the time of execution of this Termination Agreement by Employee the Termination Amounts set forth on Annex A attached hereto (subject to applicable withholding) by wire transfer of immediately available funds. Employee also shall be entitled to the other rights and benefits under the Employment Agreement (including but not limited to those set forth in Section 9) arising or due as a result of the termination of his employment other than for Cause or Disability (as defined in the Employment Agreement) and shall be subject to his continuing obligations thereunder. For purposes of the application of Section 9 of the Employment Agreement and calculation of the Gross-Up Payment, Employee hereby represents and warrants that his "base amount," within the meaning of Section 280G(b)(3) as calculated in accordance with Section 280(G) of the Internal Revenue Code of 1986, as amended, is the amount reflected as the "base amount" on Annex A attached hereto. The Company and Employee have agreed that the value of any "parachute payments," within the meaning of Section 280G(b)(2) paid or payable to Employee pursuant to this Termination Agreement, the Employment Agreement (as modified hereby) or otherwise, excluding the Principal Severance Payment (as reflected on Annex A) and the Gross-Up Payment will be the "Parachute Payment Value" set forth on Annex A. Employee has agreed to such value for purposes of the initial determination of the Gross-Up Payment under Section 9 of the Employment Agreement. Employee agrees that, for purposes of such calculation, in addition to the tax imposed under Section 280G, the parties shall assume that Employee pays and will pay a combined federal, state and local tax rate of 39%. The Company and Employee have agreed in -3- a separate Escrow Agreement entered into in connection with this Agreement to escrow certain monies to be available to Employee if the Gross-Up Payment is hereafter required to be paid. In addition to the lump sum payment provided for above, the Company shall transfer to Employee ownership of the Company car he is currently using, his office computer, telecopy machine, printer and mobile phone and the professional books acquired by the Company for Employee's use all as more particularly described on Annex B attached hereto, in each case free and clear of any liens or other encumbrances. The Company shall also provide Employee, at the Company's expense, with the services of an out-placement consulting firm for a period of one year provided the costs to the Company in this regard will not exceed $9,000. The Company may withhold from any amounts payable under this Termination Agreement such federal, state and local taxes as shall be required to be withheld pursuant to any applicable law or regulation. FOURTH: The Company acknowledges and agrees that Employee is and will continue to be entitled to indemnification as provided in the Company's bylaws and that no amendment of such bylaws after the date hereof will be effective as applied to Employee if it would adversely affect his rights to indemnification. The Company also acknowledges and agrees that it is not aware of any fact or circumstance that would disqualify Employee from satisfying the requirements necessary to permit the Company's indemnification of Employee as set forth in the Texas Business Corporation Act. The Company also agrees, for a period of five years following the date hereof, to use commercially reasonable best efforts to maintain directors and officers liability insurance providing coverage substantially the same or better as that currently maintained by the Company; provided that if the cost of maintaining such insurance would exceed twice the cost currently being incurred by the Company therefor, the Company shall only -4- be required to maintain directors and officers liability insurance providing the maximum coverage that can be obtained for a cost that is twice the amount currently being incurred. FIFTH: In consideration of the payments and agreements contained in this Termination Agreement, and with the exception of rights created by or pursuant to this Termination Agreement or the Employment Agreement (as modified hereby), Employee, on his own behalf and on behalf of his affiliates, agents, legal representatives, heirs, successors and assigns (the "Employee Parties"), does hereby fully and forever release, acquit, forgive and forever discharge the Company and its subsidiaries, affiliates, directors, officers, agents, legal representatives, successors and assigns (the "Company Parties") from any and all claims, demands and causes of action whatsoever, of every name, nature of description, whether arising out of contract, tort or otherwise and whether based on common law, statute or administrative regulation, and whether known or unknown, which Employee now has or might have, in any way relating to Employee's service or capacity as a director or officer of, or his employment by, the Company or any subsidiary or affiliate of the Company. Without in any way limiting the foregoing, Employee waives and releases the Company and its subsidiaries and affiliates from any claims that Employee could assert, known or unknown, in connection with Section 6(d)(i) of the Employment Agreement, and acknowledges that this Termination Agreement extinguishes and replaces Section 6(d)(i) of the Employment Agreement with the provisions of this Termination Agreement. In addition, the Employee hereby renounces, effective as of the date hereof, all of the Employee's respective rights, in whatever capacity (whether personal or as an officer or director of the Company or any subsidiary or affiliate), granted under any proxy or agreement to vote any shares of common stock of the Company held by other persons, and shall take all such further actions as the Company may reasonably request from time to time to evidence such -5- renunciation of, or to cause such voting rights to be revested in the persons of the grantors under, such proxies or agreements. SIXTH: In consideration of the mutual promises and agreements contained in this Termination Agreement, and with the exception of rights created by or pursuant to this Termination Agreement and the Employment Agreement (as modified hereby), the Company, on its own behalf and on behalf of the other Company Parties, does hereby fully and forever release, acquit, forgive and discharge Employee and the other Employee Parties from any and all claims, demands and causes of action whatsoever, of every name, nature of description, whether arising out of contract, tort or otherwise and whether based on common law, statute or administrative regulation, and, whether known or unknown, which the Company or any Company Party now has or might have, in any way relating to Employee's service or capacity as a director or officer of, or his employment by, the Company or any of its subsidiaries or affiliates or the termination of any such service or employment. -6- SEVENTH: (a) Each party hereto agrees that, following execution of this Termination Agreement, such party will not disclose the terms hereof, to any other person, except in the case where, and only to the extent that, there is a bona fide need for such disclosure to a third party, such as in connection with obtaining advice or furnishing personal financial information, and, in each such case, only on the condition that such other person keeps such information strictly confidential. The foregoing obligations of confidentiality shall not apply to information that is required to be disclosed as a result of any applicable law, rule or regulation of any governmental authority or any court. (b) Employee agrees that he will keep confidential and will not, directly or indirectly, use for himself or use for, or disclose to, any person, any information, data or technology regarding the business or operations of the Company, or any subsidiary or affiliate of the Company including, without limitation, any strategy, information, data or technology regarding costs, uses, methods, applications, customers, accounts, suppliers, apparatus, process, system, or other method at any time used, developed or investigated by or for the Company, or any subsidiary or affiliate of the Company, whether or not invented, developed, acquired, discovered or investigated by Employee. The foregoing disclosure restrictions shall not apply when disclosure is required of Employee pursuant to a subpoena or order issued by a court or governmental agency of competent jurisdiction, provided that detailed notice of such subpoena or order is first given to the Company so to provide the Company a reasonable opportunity to challenge or object to such subpoena or order and in no event will Employee be permitted to provide copies of written documentation pertaining to the Company to any third party. Furthermore, Employee agrees to utilize and assert any and all applicable privileges regarding -7- any requested disclosure respecting the Company. The provisions of this subsection (b) supercede the confidentiality covenant contained in Article 10 of the Employment Agreement. (c) Employee shall immediately deliver and return to the Company all books, records, memoranda, plans, computer discs (and transcripts or copies thereof), correspondence, studies and reports, operating projections, trade secrets, customer lists and other documents of any kind and character relating to the Company or its subsidiaries or affiliates or their respective business operations made or compiled by, delivered to, or otherwise acquired by Employee. (d) Except with the express prior written consent of the Company which may be withheld in the Company's sole discretion, Employee will not retain any copies of all or any portion of the information or data referenced in subsections (b) and (c) above. (e) Except as otherwise provided in the third paragraph of Section Third above, Employee agrees to immediately return all other Company property under his possession or control, including, without limitation, all Company identification, parking cards, access cards, travel authority cards, keys and credit cards to the Company. EIGHTH: Employee will not, directly or indirectly, whether for his own account or for the account of any other person: (a) for a period of six months following the date hereof, do anything which would interfere with or divert from the Company any trade, business or business opportunity with (i) any individual or entity with whom Employee has had any contact or association during his tenure with the Company or its subsidiaries or affiliates or (ii) any individual or entity whose identity was confidential and learned by Employee while an employee or officer of the Company -8- or its subsidiaries or affiliates, provided nothing herein shall limit the application of Section SEVENTH above; (b) for a period of two years following the date hereof, either for himself or as an investor, director, officer, principal, agent, employee, advisor, partner, or in any corporate, individual or representative capacity, solicit, induce or attempt to induce any individual employed by the Company or one of its subsidiaries or affiliates to leave the employment of the Company or such subsidiary or affiliate; (c) for a period of six months following the date hereof, engage in or carry on, directly or indirectly, either for himself or as a member of a partnership or as a stockholder or a equity holder (except as a stockholder of less than one percent (1%) of the issued and outstanding stock of a publicly held corporation), investor, officer, or director of a corporation or other entity or as an employee, agent, associate or consultant of any person, partnership, corporation or other entity, any business which is within 150 miles of any office of the Company or its subsidiaries or affiliates and which is in competition with the business of the Company or its subsidiaries or affiliates as conducted on or contemplated as of the date hereof; or (d) do anything that could reasonably be expected to harm the relationship enjoyed by the Company or its subsidiaries or affiliates with any individual (including any employee or officer of the Company or its subsidiaries or affiliates) or entity who or which has provided financing, equipment, materials, supplies and/or services to the Company or its subsidiaries or affiliates prior to the date hereof. NINTH: Employee shall on or prior to the effective date of this Agreement, submit all actual, reasonable and customary expenses theretofore incurred by Employee in the course of Employee's employment with proper documentation, which, upon verification, the Company -9- shall reimburse promptly in accordance with the Company's reimbursement policy. Employee acknowledges and agrees that Employee has not and has no authority to incur any expenses after the date Employee executes this Agreement, and further agrees that, notwithstanding the provisions of the Employment Agreement, the Company shall have no obligation to reimburse expenses not submitted within the time set forth above or incurred after the date hereof. TENTH: Employee understands and acknowledges that he: (i) has received and has read this Termination Agreement; (ii) is fully informed of and fully understands the terms and meaning of the terms, conditions and effect of signing this Termination Agreement; (iii) has had ample opportunity to ask questions of Company personnel and that the Company advised him and hereby advises him in writing to consult with an attorney of his choice prior to executing this Termination Agreement; (iv) has relied solely on his own judgment and on the advice of such counselors and advisors with whom he has considered it appropriate, desirable, or necessary to consult in making the decision to sign this Termination Agreement, and Employee represents and acknowledges that in executing this Termination Agreement he does not rely and has not relied upon any representation or statement made by the Company, or by any of the Company's agents, shareholders, directors, attorneys, or representatives with regard to the subject matter, basis, or effect of this Termination Agreement or otherwise, other than those specifically stated in this written Termination Agreement; (v) has made his decision voluntarily without any pressure from the Company or its employees either to accept or reject this Termination Agreement; (vi) had twenty-one days to consider this Termination Agreement if he chose to do so, and that no one hurried him into executing this Termination Agreement during that 21-day period, or otherwise coerced him into executing this Termination Agreement; (vii) has seven days following his execution of this Termination Agreement to revoke such acceptance; (viii) must make any such revocation of his prior acceptance of this Termination Agreement in writing and cause such revocation, together with a cashier's check in the amount of the lump sum payment received by him pursuant to -10- Section THIRD, to be delivered to the Company at 11490 Westheimer, Suite 1000, Houston, Texas 77077; (ix) he fully understands that he is, through this Termination Agreement, releasing the Company from any and all claims he may have against the Company and the other parties specified in Section FIFTH, and that this Termination Agreement constitutes a release and discharge of claims arising under the 29 U.S.C.Section 621-634, including the Older Workers' Benefit Protection Act, 29 U.S.C.Section 626(f); and (x) he acknowledges that, because he has waived his rights under Sections 6(d)(i) of the Employment Agreement, the payments and other benefits that he will receive in accordance with Section THIRD of this Termination Agreement constitutes something of value to which Employee would not be entitled to receive if he did not agree to give the Company a release of claims. ELEVENTH: If within seven days following Employee's acceptance of this Termination Agreement, Employee revokes such acceptance in accordance with clauses (vii) and (viii) of Section TENTH, then all of the rights and obligations of the parties hereunder shall be deemed rescinded and the parties shall be restored to their respective positions, offices, rights and obligations as they existed immediately prior to execution of this Termination Agreement. TWELFTH: This Termination Agreement is made and entered into in the State of Texas, and, except to the extent that federal law controls the interpretation or enforceability of any provision in this Termination Agreement in which case any such provision shall be construed and enforced in accordance with federal law, shall in all respects be interpreted, enforced and governed under the laws of the State of Texas. The language of all parts of this Termination Agreement shall in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any of the parties. Any claim or controversy of whatever nature arising from or relating in any way to this Termination Agreement, the Employment Agreement, the employment relationship between the Company and Employee or the cessation of such relationship, including disputes arising under the common law or federal or state statutes, laws or -11- regulations and disputes with respect to the arbitrability of any claim or controversy, shall be resolved exclusively by final and binding arbitration before a single experienced employment arbitrator selected in accordance with the Employment Dispute Resolution ("EDR") Rules of the American Arbitration Association ("AAA") unless the parties hereto shall agree otherwise in writing. The arbitration will be conducted in Houston, Texas (or in such other place as may be mutually agreed by the parties) pursuant to the EDR Rules of the AAA, and the arbitrator shall have full authority to award or grant all remedies provided by law. The judgment upon the award may be enforced by any court having jurisdiction thereof. Each party shall pay the fees of their respective attorneys, the expenses of their witnesses, and any other expenses incurred by such party in connection with the arbitration; provided, however, that the Company shall pay for the fees of the arbitrator and the administrative and filing fees charged by the AAA. THIRTEENTH: Should any provision of this Termination Agreement be declared or be determined by any court to be unenforceable or invalid as drafted, it may and shall be reformed or modified by a court of competent jurisdiction to the form of an enforceable and valid provision that achieves, to the greatest extent possible, the result intended by the parties in drafting and agreeing to the unenforceable and invalid provision. Should a court of competent jurisdiction decline to so reform or modify such a provision or determine that no enforceable and valid provision can be created to achieve the intended result, the unenforceability and invalidity of the remaining parts, terms or provisions of this Termination Agreement shall not be affected thereby and said unenforceable or invalid part, term, or provision shall be deemed not to be a part of this Termination Agreement. FOURTEENTH: This Termination Agreement, together with the Employment Agreement (as modified hereby) and the Escrow Agreement, set forth the entire agreement -12- between the parties hereto, and supersede any and all other prior agreements or understanding between the parties hereto pertaining to the subject matter hereof. This Termination Agreement shall be binding on and inure to the benefit of the Company and its successors and assigns, and, in the event of Employee's death or incapacity, shall inure to the benefit of Employee's estate or other legal representatives. -13- EXECUTED on the 6th day of June, 2001, but effective as of 12:01 a.m. (central time) on the 7th day of June, 2001. ICO, INC. By: /s/ JON C. BIRO --------------------------------------- Name: Jon C. Biro ------------------------------------- Title: Senior Vice President, ------------------------------------ Chief Accounting and Treasurer ------------------------------------ /s/ DAVID M. GERST ------------------------------------------ DAVID M. GERST -14- ANNEX A TO TERMINATION AGREEMENT (D. Gerst) I. TERMINATION PAYMENTS: Principal Severance Payment: $ 702,205 Legal Fees and Related Expenses: $ 23,213 Accrued Unpaid Vacation $ 16,154 II. GROSS-UP PAYMENT COMPONENTS: Base Amount: $ 99,124 Parachute Payment Value: $ 82,337 III. POTENTIAL GROSS-UP PAYMENT: $ 351,948
ANNEX B TO TERMINATION AGREEMENT (D. Gerst) Car: 2000 Mercedes-Benz 320 CLK Office computer: Dell desktop and Dell laptop Printer: Hewlett Packard laser printer Mobile Phone: Nokia digital Professional Books: Various legal publications as agreed between the Company and D. Gerst EX-99.6 7 dex996.txt TOM PACHOLDER TERMINATION AGREEMENT EXHIBIT 6 TERMINATION AGREEMENT THIS TERMINATION AGREEMENT is made and entered into by and between Tom D. Pacholder (hereinafter referred to as "Employee"), Wedco, Inc., a New Jersey corporation and wholly-owned subsidiary of ICO, Inc. ("Wedco") and ICO, Inc. (hereinafter referred to as the "Company"). WITNESSETH: WHEREAS, Wedco and Employee are parties to an Amended and Restated Employment Agreement dated August 11, 1999 (as amended, the "Employment Agreement"); and WHEREAS, the Company and Wedco desire to terminate Employee's employment by and position as an officer of Wedco and any and all other subsidiaries and affiliates of the Company and Employee has consented to such termination; and WHEREAS, the termination of Employee's employment is being effected by mutual agreement of Employee, Wedco and the Company and is not intended to constitute termination for "Cause" as defined in the Employment Agreement; and WHEREAS, Employee is willing to resign from all other positions with the Company, Wedco and their respective subsidiaries and affiliates (other than those from which he is being terminated) and the Company and Wedco are willing to accept such resignation; and WHEREAS, Employee, Wedco and the Company desire to modify certain of their obligations in connection with such termination of employment from those set forth in the Employment Agreement; and WHEREAS, Employee, Wedco and the Company mutually desire to avoid and resolve any and all actual and potential differences between them; NOW, THEREFORE, in consideration of the premises and mutual promises herein contained, it is mutually agreed as follows: FIRST: The Company and Wedco hereby terminate Employee as an employee (including as Senior Vice President - Corporate Administration) of Wedco, effective immediately, and Employee hereby consents to such termination. In addition, Employee hereby tenders, and the Company and Wedco hereby accept, Employee's immediate resignation from all other offices, directorships and committee memberships of any and all subsidiaries and affiliates of the Company and all committees thereof; provided, however, that nothing herein will require resignation from any officer, directorships or positions, if any, held in Pacholder Associates, Inc. or the Pacholder High Yield Fund. SECOND: In any and all press releases and other public communications made by any party, the stated reason for Employee's termination as an employee and officer shall be the desire of Employee, the Company and Wedco to avoid conflict among the members of the Company's board of directors; provided, however, that neither the making of such statements nor Employee's termination are to be construed as meaning or suggesting that Employee has been terminated for reason of his age. Employee shall be afforded the opportunity to review and comment on any press release with respect to this Termination Agreement or his termination of employment at least one day in advance of the actual release thereof. The Company, Wedco and Employee hereby agree not to make any disparaging or intentionally false or misleading statements (or encourage others to make any such statements) regarding the other. The preceding sentence shall not apply to any statements required to be made by applicable law or to avoid perjury. -2- THIRD: The Company and Wedco acknowledge and agree that Employee's termination of employment is not as a result of Disability and is not intended to be as a result of any action that would constitute Cause (as such terms are defined in the Employment Agreement). Notwithstanding the terms of Section 6(d)(i) of the Employment Agreement (which if applied would result in a substantially higher payment), as consideration for Employee's termination the Company shall pay Employee at the time of execution of this Termination Agreement by Employee the Termination Amounts set forth on Annex A attached hereto (subject to applicable withholding) by wire transfer of immediately available funds. Employee also shall be entitled to the other rights and benefits under the Employment Agreement (including but not limited to those set forth in Section 9) arising or due as a result of the termination of his employment other than for Cause or Disability (as defined in the Employment Agreement) and shall be subject to his continuing obligations thereunder. For purposes of the application of Section 9 of the Employment Agreement and calculation of the Gross-Up Payment, Employee hereby represents and warrants that his "base amount," within the meaning of Section 280G(b)(3) as calculated in accordance with Section 280(G) of the Internal Revenue Code of 1986, as amended, is the amount reflected as the "base amount" on Annex A attached hereto. The Company and Employee have agreed that the value of any "parachute payments," within the meaning of Section 280G(b)(2) paid or payable to Employee pursuant to this Termination Agreement, the Employment Agreement (as modified hereby) or otherwise, excluding the Principal Severance Payment (as reflected on Annex A) and the Gross-Up Payment will be the "Parachute Payment Value" set forth on Annex A. Employee has agreed to such value for purposes of the initial determination of the Gross-Up Payment under Section 9 of the Employment Agreement. Employee agrees that, for purposes of such calculation, in addition -3- to the tax imposed under Section 280G, the parties shall assume that Employee pays and will pay a combined federal, state and local tax rate of 39%. The Company and Employee have agreed in a separate Escrow Agreement entered into in connection with this Agreement to escrow certain monies to be available to Employee if the Gross-Up Payment is hereafter required to be paid. In addition to the monetary payments provided for above, the Company or Wedco, as the case may be, shall transfer to Employee ownership of the Company car he is currently using, his office computer, telecopy machine, printer and mobile phone and the professional books acquired by the Company for Employee's use all as more particularly described on Annex B attached hereto, in each case free and clear of any liens or other encumbrances. The Company shall also provide Employee, at the Company's expense, with the services of an out- placement consulting firm for a period of one year provided the costs to the Company in this regard will not exceed $9,000. The Company and Wedco, as the case may be, may withhold from any amounts payable under this Termination Agreement such federal, state and local taxes as shall be required to be withheld pursuant to any applicable law or regulation. FOURTH: The Company acknowledges and agrees that Employee is and will continue to be entitled to indemnification as provided in the Company's bylaws and that no amendment of such bylaws after the date hereof will be effective as applied to Employee if it would adversely affect his rights to indemnification. The Company also acknowledges and agrees that it is not aware of any fact or circumstance that would disqualify Employee from satisfying the requirements necessary to permit the Company's indemnification of Employee as set forth in the Texas Business Corporation Act. The Company also agrees, for a period of five years following the date hereof, to use commercially reasonable best efforts to maintain directors and officers -4- liability insurance providing coverage substantially the same as or better than that currently maintained by the Company; provided that if the cost of maintaining such insurance would exceed twice the cost currently being incurred by the Company therefor, the Company shall only be required to maintain directors and officers liability insurance providing the maximum coverage that can be obtained for a cost that is twice the amount currently being incurred. FIFTH: In consideration of the payments and agreements contained in this Termination Agreement, and with the exception of rights created by or pursuant to this Termination Agreement or the Employment Agreement (as modified hereby), Employee, on his own behalf and on behalf of his affiliates, agents, legal representatives, heirs, successors and assigns (the "Employee Parties"), does hereby fully and forever release, acquit, forgive and forever discharge the Company, Wedco and their respective subsidiaries, affiliates, directors, officers, agents, legal representatives, successors and assigns (the "Company Parties") from any and all claims, demands and causes of action whatsoever, of every name, nature of description, whether arising out of contract, tort or otherwise and whether based on common law, statute or administrative regulation, and whether known or unknown, which Employee now has or might have, in any way relating to Employee's service or capacity as a director or officer of, or his employment by, Wedco, the Company or any subsidiary or affiliate of the Company. Without in any way limiting the foregoing, Employee waives and releases Wedco, the Company and its subsidiaries and affiliates from any claims that Employee could assert, known or unknown, in connection with Section 6(d)(i) of the Employment Agreement, and acknowledges that this Termination Agreement extinguishes and replaces Section 6(d)(i) of the Employment Agreement with the provisions of this Termination Agreement. In addition, the Employee hereby renounces, effective as of the date hereof, all of the Employee's respective rights, in whatever capacity -5- (whether personal or as an officer or director of the Company or any subsidiary or affiliate), granted under any proxy or agreement to vote any shares of common stock of the Company or any subsidiary or affiliate held by other persons, and shall take all such further actions as the Company may reasonably request from time to time to evidence such renunciation of, or to cause such voting rights to be revested in the persons of the grantors under, such proxies or agreements. SIXTH: In consideration of the mutual promises and agreements contained in this Termination Agreement, and with the exception of rights created by or pursuant to this Termination Agreement and the Employment Agreement (as modified hereby), the Company, on its own behalf and on behalf of the other Company Parties, does hereby fully and forever release, acquit, forgive and discharge Employee and the other Employee Parties from any and all claims, demands and causes of action whatsoever, of every name, nature of description, whether arising out of contract, tort or otherwise and whether based on common law, statute or administrative regulation, and, whether known or unknown, which the Company or any Company Party now has or might have, in any way relating to Employee's service or capacity as a director or officer of, or his employment by, Wedco, the Company or any of its subsidiaries or affiliates or the termination of any such service or employment. SEVENTH: (a) Each party hereto agrees that, following execution of this Termination Agreement, such party will not disclose the terms hereof, to any other person, except in the case where, and only to the extent that, there is a bona fide need for such disclosure to a third party, such as in connection with obtaining advice or furnishing personal financial information, and, in each such case, only on the condition that such other person keeps such information strictly -6- confidential. The foregoing obligations of confidentiality shall not apply to information that is required to be disclosed as a result of any applicable law, rule or regulation of any governmental authority or any court. (b) Employee agrees that he will keep confidential and will not, directly or indirectly, use for himself or use for, or disclose to, any person, any information, data or technology regarding the business or operations of the Company, or any subsidiary or affiliate of the Company including, without limitation, any strategy, information, data or technology regarding costs, uses, methods, applications, customers, accounts, suppliers, apparatus, process, system, or other method at any time used, developed or investigated by or for the Company, or any subsidiary or affiliate of the Company, whether or not invented, developed, acquired, discovered or investigated by Employee. The foregoing disclosure restrictions shall not apply when disclosure is required of Employee pursuant to a subpoena or order issued by a court or governmental agency of competent jurisdiction, provided that detailed notice of such subpoena or order is first given to the Company so to provide the Company a reasonable opportunity to challenge or object to such subpoena or order and in no event will Employee be permitted to provide copies of written documentation pertaining to the Company to any third party. Furthermore, Employee agrees to utilize and assert any and all applicable privileges regarding any requested disclosure respecting the Company. The provisions of this subsection (b) supercede the confidentiality covenant contained in Article 10 of the Employment Agreement. (c) Employee shall immediately deliver and return to the Company all books, records, memoranda, plans, computer discs (and transcripts or copies thereof), correspondence, studies and reports, operating projections, trade secrets, customer lists and other documents of -7- any kind and character relating to the Company or its subsidiaries or affiliates or their respective business operations made or compiled by, delivered to, or otherwise acquired by Employee. (d) Except with the express prior written consent of the Company which may be withheld in the Company's sole discretion, Employee will not retain any copies of all or any portion of the information or data referenced in subsections (b) and (c) above. (e) Except as otherwise provided in the third paragraph of Section THIRD above, Employee agrees to immediately return all other Company property under his possession or control, including, without limitation, all Company identification, parking cards, access cards, travel authority cards, keys and credit cards to the Company. EIGHTH: Employee will not, directly or indirectly, whether for his own account or for the account of any other person: (a) for a period of six months following the date hereof, do anything which would interfere with or divert from the Company any trade, business or business opportunity with (i) any individual or entity with whom Employee has had any contact or association during his tenure with the Company or its subsidiaries or affiliates or (ii) any individual or entity whose identity was confidential and learned by Employee while an employee or officer of the Company or its subsidiaries or affiliates provided nothing herein limits the application of Section SEVENTH above; (b) for a period of two years following the date hereof, either for himself or as an investor, director, officer, principal, agent, employee, advisor, partner, or in any corporate, individual or representative capacity, solicit, induce or attempt to induce any individual -8- employed by the Company or one of its subsidiaries or affiliates to leave the employment of the Company or such subsidiary or affiliate; (c) for a period of six months following the date hereof, engage in or carry on, directly or indirectly, either for himself or as a member of a partnership or as a stockholder or a equity holder (except as a stockholder of less than one percent (1%) of the issued and outstanding stock of a publicly held corporation), investor, officer, or director of a corporation or other entity or as an employee, agent, associate or consultant of any person, partnership, corporation or other entity, any business within 150 miles of any office of the Company or its subsidiaries or affiliates and which is in competition with the business of the Wedco segment/division of the Company as conducted on or contemplated as of the date hereof; or (d) do anything that could reasonably be expected to harm the relationship enjoyed by the Company or its affiliates with any individual (including any employee or officer of the Company or its subsidiaries or affiliates) or entity who or which has provided financing, equipment, materials, supplies and/or services to the Company or its subsidiaries or affiliates prior to the date hereof. NINTH: Employee shall on or prior to the effective date of this Agreement, submit all actual, reasonable and customary expenses theretofore incurred by Employee in the course of Employee's employment with proper documentation, which, upon verification, the Company shall reimburse promptly in accordance with the Company's reimbursement policy. Employee acknowledges and agrees that Employee has not and has no authority to incur any expenses after the date Employee executes this Agreement, and further agrees that, notwithstanding the provisions of the Employment Agreement, the Company shall have no obligation to reimburse expenses not submitted within the time set forth above or incurred after the date hereof. -9- TENTH: Employee understands and acknowledges that he: (i) has received and has read this Termination Agreement; (ii) is fully informed of and fully understands the terms and meaning of the terms, conditions and effect of signing this Termination Agreement; (iii) has had ample opportunity to ask questions of Company personnel and that the Company advised him and hereby advises him in writing to consult with an attorney of his choice prior to executing this Termination Agreement; (iv) has relied solely on his own judgment and on the advice of such counselors and advisors with whom he has considered it appropriate, desirable, or necessary to consult in making the decision to sign this Termination Agreement, and Employee represents and acknowledges that in executing this Termination Agreement he does not rely and has not relied upon any representation or statement made by the Company, or by any of the Company's agents, shareholders, directors, attorneys, or representatives with regard to the subject matter, basis, or effect of this Termination Agreement or otherwise, other than those specifically stated in this written Termination Agreement; (v) has made his decision voluntarily without any pressure from the Company or its employees either to accept or reject this Termination Agreement; (vi) had twenty-one days to consider this Termination Agreement if he chose to do so, and that no one hurried him into executing this Termination Agreement during that 21-day period, or otherwise coerced him into executing this Termination Agreement; (vii) has seven days following his execution of this Termination Agreement to revoke such acceptance; (viii) must make any such revocation of his prior acceptance of this Termination Agreement in writing and cause such revocation, together with a cashier's check in the amount of the lump sum payment received by him pursuant to Section THIRD, to be delivered to the Company at 11490 Westheimer, Suite 1000, Houston, Texas 77077; (ix) he fully understands that he is, through this Termination Agreement, releasing the Company from any and all claims he may have against the Company and the other parties specified in Section FIFTH, and that this Termination Agreement constitutes a release and discharge of claims arising under the 29 U.S.C. Sections 621-634, including the Older Workers' Benefit Protection Act, 29 U.S.C. Sections 626(f); and -10- (x) he acknowledges that, because he has waived his rights under Sections 6(d)(i) of the Employment Agreement, the payments and other benefits that he will receive in accordance with Section THIRD of this Termination Agreement constitutes something of value to which Employee would not be entitled to receive if he did not agree to give the Company a release of claims. ELEVENTH: If within seven days following Employee's acceptance of this Termination Agreement, Employee revokes such acceptance in accordance with clauses (vii) and (viii) of Section TENTH, then all of the rights and obligations of the parties hereunder shall be deemed rescinded and the parties shall be restored to their respective positions, offices, rights and obligations as they existed immediately prior to execution of this Termination Agreement. TWELFTH: This Termination Agreement is made and entered into in the State of Texas, and, except to the extent that federal law controls the interpretation or enforceability of any provision in this Termination Agreement in which case any such provision shall be construed and enforced in accordance with federal law, shall in all respects be interpreted, enforced and governed under the laws of the State of Texas. The language of all parts of this Termination Agreement shall in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any of the parties. Any claim or controversy of whatever nature arising from or relating in any way to this Termination Agreement, the Employment Agreement, the employment relationship between the Company and Employee or the cessation of such relationship, including disputes arising under the common law or federal or state statutes, laws or regulations and disputes with respect to the arbitrability of any claim or controversy, shall be resolved exclusively by final and binding arbitration before a single experienced employment arbitrator selected in accordance with the Employment Dispute Resolution ("EDR") Rules of the American Arbitration Association ("AAA") unless the parties hereto shall agree otherwise in writing. The arbitration will be conducted in Houston, Texas (or in such other place as may be -11- mutually agreed by the parties) pursuant to the EDR Rules of the AAA, and the arbitrator shall have full authority to award or grant all remedies provided by law. The judgment upon the award may be enforced by any court having jurisdiction thereof. Each party shall pay the fees of their respective attorneys, the expenses of their witnesses, and any other expenses incurred by such party in connection with the arbitration; provided, however, that the Company shall pay for the fees of the arbitrator and the administrative and filing fees charged by the AAA. THIRTEENTH: Should any provision of this Termination Agreement be declared or be determined by any court to be unenforceable or invalid as drafted, it may and shall be reformed or modified by a court of competent jurisdiction to the form of an enforceable and valid provision that achieves, to the greatest extent possible, the result intended by the parties in drafting and agreeing to the unenforceable and invalid provision. Should a court of competent jurisdiction decline to so reform or modify such a provision or determine that no enforceable and valid provision can be created to achieve the intended result, the unenforceability and invalidity of the remaining parts, terms or provisions of this Termination Agreement shall not be affected thereby and said unenforceable or invalid part, term, or provision shall be deemed not to be a part of this Termination Agreement. FOURTEENTH: This Termination Agreement, together with the Employment Agreement (as modified hereby) and the Escrow Agreement, set forth the entire agreement between the parties hereto, and supersede any and all other prior agreements or understanding between the parties hereto pertaining to the subject matter hereof. This Termination Agreement shall be binding on and inure to the benefit of Wedco, the Company and their respective successors and assigns, and, in the event of Employee's death or incapacity, shall inure to the benefit of Employee's estate or other legal representatives. -12- EXECUTED on the 6th day of June, 2001, but effective as of 12:01 a.m. (central time) on the 7th day of June, 2001. ICO, INC. By: /s/ JON C. BIRO --------------------------------------- Name: Jon C. Biro ------------------------------------- Title: Senior Vice President, ------------------------------------ Chief Accounting and Treasurer ------------------------------------ /s/ TOM D. PACHOLDER ------------------------------------------ TOM D. PACHOLDER WEDCO, INC. By: /s/ JON C. BIRO --------------------------------------- Name: Jon C. Biro ------------------------------------- Title: Treasurer ------------------------------------ -13- ANNEX A TO TERMINATION AGREEMENT (T. Pacholder) I. TERMINATION PAYMENTS: Principal Severance Payment: $ 384,541 Legal Fees and Related Expenses: $ 9,000 Accrued Unpaid Vacation $ 9,231 II. GROSS-UP PAYMENT COMPONENTS: Base Amount: $ 80,629 Parachute Payment Value: $ 65,140 III. POTENTIAL GROSS-UP PAYMENT: $ 189,500 ANNEX B TO TERMINATION AGREEMENT (T. Pacholder) Car: 2000 Audi A6 2.7 Office computer: Dell laptop Printer: Hewlett Packard inkjet Mobile Phone: Motorola StarTac Professional Books: None EX-99.7 8 dex997.txt RESOLUTION EXHIBIT 7 BOARD RESOLUTION NOW, THEREFORE, the following resolutions are adopted by the Board of Directors of the Company (consisting of 12 directors including A. Pacholder, S. Pacholder, W. Willoughby. W. Morgan, J. Gibson, J. Williamson, W. Leib, J. Calaway, J. Knapp, C. McCord, T. Gollin and C. O'Sullivan): Termination of Willoughby International Stockholders Agreement - -------------------------------------------------------------- RESOLVED FURTHER, that the execution and delivery by the Company of the Consent to Termination Agreement with respect to that certain Willoughby International Stockholders Agreement, dated effective as of April 30, 1996, by and among the Company and the shareholders of the Company party thereto, in the form presented at this meeting, is hereby approved; and the Treasurer of the Company is hereby authorized to execute and deliver such agreement on behalf of the Company; and -----END PRIVACY-ENHANCED MESSAGE-----