Exhibit 10.1
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as
of the 15th day of November, 2006 by and between CHROMCRAFT REVINGTON, INC. (the
"Company"), a Delaware corporation, and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ (the "Executive"),
currently a resident of the State of Tennessee,
W I T N E S S E T H:
WHEREAS, the Company desires to employ the Executive as its Senior Vice
President and the President of CRI Residential Sales, and the Executive desires
to be employed by the Company as such, in accordance with the provisions of this
Agreement; and
WHEREAS, in addition to the employment provisions contained herein, the
Company and the Executive have agreed to certain restrictions, covenants,
agreements and severance payments, as set forth in this Agreement;
NOW, THEREFORE, in consideration of the foregoing premises, the
respective covenants, agreements and obligations contained herein, the
employment of the Executive by the Company pursuant to this Agreement and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company and the Executive hereby agree as follows:
Section 1. Employment; Term.
(a) Employment. Unless the Executive's employment with the Company is
terminated earlier as provided in this Agreement, the Company hereby agrees to
employ the Executive, and the Executive hereby agrees to be employed by the
Company, during the Term (as hereinafter defined), on a full-time basis in
accordance with the provisions of this Agreement.
(b) Term. (i) Subject to Section 1(b)(ii), unless the Executive's
employment with the Company is terminated earlier in accordance with Section 4
hereof, the initial term of the Executive's employment with the Company under
this Agreement shall begin on December 1, 2006 (or on such later date as may be
mutually agreed upon by the Company and the Executive) and shall end on the
one-year anniversary of the Executive's first day of employment with the Company
(the "Initial Term"); provided, however that upon the expiration of the Initial
Term, the Executive's employment under this Agreement shall thereafter be
automatically extended upon the same terms and conditions as set forth herein
for successive one year terms (each, a "Renewal Term"), unless the Company or
the Executive shall have delivered to the other a written notice not less than
ninety (90) days prior to the expiration of the Initial Term or any Renewal Term
stating that the term of this Agreement shall not be so extended, in which case
the Executive's employment hereunder shall terminate at the end of the Initial
Term or a Renewal Term, as the case may be. The Initial Term and a Renewal Term
may be referred to in this Agreement individually or collectively as the "Term."
(ii) Notwithstanding anything in this Agreement to the contrary, in
the event that the Executive does not commence his employment with the Company
by December 15, 2006, then either the Company or the Executive may terminate
this Agreement without any obligation to the other under this Agreement or
otherwise. Without limiting the foregoing in any manner, in the event of any
such termination, (A) the Company shall not be obligated to pay or provide to
the Executive any salary, incentive compensation, employee benefits, housing or
automobile allowances, severance payments or any other amounts or benefits (or
to issue any shares of restricted common stock to the Executive) under this
Agreement or otherwise, and (B) the Executive shall not be bound by the
covenants and agreements set forth in Section 6, Section 7 or Section 8 of this
Agreement.
Section 2. Position; Duties; Responsibilities. During the Term, the
Executive:
(a) shall serve as a Senior Vice President and the President of CRI
Residential Sales of the Company;
(b) shall have general responsibility over the sales function of the
Company and its subsidiaries and affiliates, subject to the direction and
oversight of the Board of Directors and the Chairman of the Company;
(c) shall have such other executive level authority, duties and
responsibilities at the Company as may from time to time be reasonably
prescribed by the Board of Directors or the Chairman of the Company or by the
By-Laws of the Company;
(d) shall perform diligently and faithfully, and use his reasonable
best efforts in the performance of, his duties and responsibilities under this
Agreement;
(e) shall devote all of his working time, attention, energies and
skills to his duties and responsibilities under this Agreement and to the
furtherance of the business and interests of the Company; and
(f) shall maintain his office at which he performs his duties and
responsibilities under this Agreement at the Company's facilities located in
Lincolnton, North Carolina and shall maintain his presence during normal
business hours at such office, other than for travel on Company business.
Section 3. Compensation and Employee Benefits.
(a) Base Salary. During the Term, for all services rendered in all
capacities by the Executive to or on behalf of the Company or any of the
Company's subsidiaries or affiliates, the Company shall pay to the Executive an
annual base salary equal to $270,000 per calendar year, as may be increased from
time to time by the Board of Directors (or a committee thereof) or the Chairman
of the Company (the "Base Salary"). If an increase in the Executive's Base
Salary is approved by the Board of Directors (or a committee thereof) or the
Chairman of the Company, the new salary shall become the applicable Base Salary
under this Agreement. The Base Salary shall be paid to the Executive in
accordance with the Company's usual and customary payroll practices applicable
to its employees generally (including, but not limited to, withholdings for
taxes and other amounts) and shall be pro-rated for any partial year of
employment.
(b) Incentive Compensation. During the Term, the Executive shall be
entitled to participate in all incentive compensation plans and programs
generally available to executive officers of the Company other than its Chief
Executive Officer (as currently are in effect or as may hereafter be
established, amended or in effect), subject to the terms and conditions of such
plans and programs. During the Term, the "target" award level of any short term
incentive compensation award granted to the Executive shall not be less than 40%
of his Base Salary.
In addition, the Company shall, prior to December 31, 2006, grant to
the Executive an award of Seven Thousand Five Hundred (7,500) shares of
restricted common stock of the Company. Such shares shall vest and be payable
incrementally to the Executive, with 2,500 shares to become vested on December
31, 2007, 2008 and 2009 on the condition that the Executive is employed by the
Company on the appropriate vesting date. As a condition to the issuance of any
shares of restricted common stock, the Executive shall execute a restricted
stock award agreement relating to such shares.
2
On the first anniversary of the Executive's employment with the
Company, the Company shall pay to the Executive a one-time cash hiring bonus in
the amount of $21,000; provided, however, that $21,000 shall be deducted from
any short term incentive compensation earned by the Executive for the 2007
performance period if the short term incentive compensation earned by the
Executive for the 2007 performance period exceeds $21,000.
(c) Employee Benefits. During the Term, the Executive shall be entitled
to participate in all employee benefit plans and programs generally available to
executive officers of the Company other than its Chief Executive Officer (as
currently in effect or as may hereafter be established, amended or in effect),
subject to the terms, conditions and eligibility requirements of such plans and
programs. The employee's cost of participation in such plans and programs shall
be as determined by the Chairman of the Company or the Board of Directors (or a
committee thereof) of the Company, if not set forth in the plans and programs.
In addition, the Executive shall be eligible to participate in the Company's
executive health insurance program (currently provided through the ExecuCare
program), and the Company shall pay $5,000 per calendar year (pro-rated for any
partial years) towards the cost of the benefit for the Executive under such
program.
(d) Other Policies. All other matters relating to the employment of the
Executive by the Company not specifically addressed in this Agreement or in the
plans and programs referenced in this Section (including, but not limited to,
vacation, sick and other paid time off) shall be subject to the employee
handbooks, rules, policies, procedures, corporate governance guidelines and
codes of conduct and ethics of the Company, as are currently in effect or as may
hereafter be in effect from time to time and as may be applicable to executive
officers of the Company other than its Chief Executive Officer. The Executive
shall be entitled to paid vacation in accordance with Company policy, but in no
event shall he be entitled to fewer than four (4) weeks of paid vacation per
calendar year (pro-rated for any partial years).
(e) Acknowledgment by the Executive. Notwithstanding anything in this
Agreement to the contrary, the Executive understands, acknowledges and agrees
that the Company may, in its sole discretion, amend, modify, replace, freeze,
suspend or terminate any or all of the incentive compensation, employee benefit,
retirement and other plans and programs available, as well as any other rules,
policies or procedures applicable, to the Executive from time to time, but only
so long as any such actions are not designed to affect solely the Executive.
(f) Automobile Allowance. During the Term, the Company shall provide to
the Executive an automobile allowance of One Thousand Dollars ($1,000) per
month. The Executive shall pay for the insurance, maintenance, fuel, license
plates and other costs relating to this automobile and shall not be entitled to
any reimbursement for mileage relating to the use of such automobile, other than
as set forth in Section 3(h) and other than for Company business trips that are
within 200 miles of Lincolnton, North Carolina. The Executive shall not be
reimbursed for mileage between the Company's facilities in Lincolnton, North
Carolina and the Executive's temporary or permanent residence in North Carolina.
(g) Licenses. During the Term, the Company shall reimburse the
Executive for the reasonable and customary (i) fees incurred by him payable to
the appropriate state authorities to maintain his licenses to practice law in
Michigan, Tennessee and Wisconsin, and (ii) costs incurred by him for required
annual continuing legal education. The aggregate amount of reimbursement shall
not exceed $3,000 per calendar year.
(h) Relocation Expenses. In connection with the relocation of the
Executive and his spouse from Tennessee to North Carolina, the Company shall pay
upon commencement of the Term:
3
(i) Reasonable temporary housing expenses of the Executive for a
temporary residence in or within 60 miles of Lincolnton,
North Carolina until the earlier of the Executive's purchase
of a home in such location or August 31, 2007;
(ii) Reasonable travel expenses of the Executive between his
current home in Morristown, Tennessee and Lincolnton, North
Carolina until the earlier of the Executive's purchase of a
home in or within 60 miles of Lincolnton, North Carolina or
August 31, 2007, provided, however, that until the earlier
of such events occurs, the Company shall pay the mileage (at
the then applicable IRS rate) of the Executive for only up
to two (2) roundtrips per month between Morristown,
Tennessee and Lincolnton, North Carolina if the closing on
the sale of the Executive's home in Morristown, Tennessee
has not occurred by August 31, 2007;
(iii) Reasonable moving expenses of the Executive in connection
with the relocation of the Executive and his spouse to or
within 60 miles of Lincolnton, North Carolina;
(iv) Reasonable real estate brokerage commission and reasonable
attorneys' fees incurred by the Executive relating to the
sale of his existing home in Morristown, Tennessee; and
(v) Reasonable closing costs (but not any points) and reasonable
attorneys' fees incurred by the Executive relating to the
purchase of his home in or within 60 miles of Lincolnton,
North Carolina.
(i) Expense Reimbursements. The Company shall reimburse the Executive
for all reasonable and customary out-of-pocket expenses incurred by the
Executive related to the performance of his duties and responsibilities for the
Company. The Executive shall comply with the Company's standard expense
reimbursement policies and procedures in effect from time to time.
(j) Taxes. All taxes (other than the Company's portion of any
employment taxes) on the salary and other amounts payable to the Executive under
this Agreement shall be paid by the Executive. The Company shall be entitled to
withhold from the Executive's Base Salary and all other amounts payable to him
under this Agreement or any plan or program (i) applicable income, employment
and other taxes, (ii) such amounts authorized by the Executive, and (iii) other
appropriate and customary amounts.
Section 4. Termination of Employment.
In addition to a termination of the Executive's employment upon a
determination by the Company or the Executive not to extend the Term (as
provided in Section 1(b) hereof), the Executive's employment with the Company
may be terminated during the Term in any of the following ways:
(a) Termination by the Company for Cause. The Company, upon written
notice to the Executive, may terminate the Executive's employment with the
Company immediately for Cause. For purposes of this Agreement, "Cause" is
defined as any of the following:
4
(i) any refusal by the Executive to follow the lawful directions of
the Board of Directors or the Chairman of the Company consistent with the
Executive's duties and responsibilities under this Agreement; or
(ii) any gross negligence by the Executive in managing the business
or affairs of the Company or in carrying out his duties and responsibilities
under this Agreement (or any negligence by any employee of the Company who
reports to the Executive in managing the business or affairs of the Company or
in performing such employee's duties at the Company with the knowledge of the
Executive and where the Executive allows or fails to prevent such negligent acts
or omissions); or
(iii) any dishonesty, fraud, theft or embezzlement by the Executive
(or by any employee of the Company who reports to the Executive with the
knowledge of the Executive and where the Executive allows or fails to prevent
such dishonesty, fraud, theft or embezzlement by such employee) upon or against
the Company or any of the Company's subsidiaries or affiliates or any customer
of the Company or any of the Company's subsidiaries or affiliates; or
(iv) any conviction of, or the entering of any plea of guilty or
nolo contendere by, the Executive for any felony; or
(v) any intentional or negligent violation by the Executive (or by
any employee of the Company who reports to the Executive with the knowledge of
the Executive and where the Executive allows or fails to prevent such violation
by such employee) of any law, statute, rule, regulation or governmental
requirement that has or will have a material adverse effect on the Company or
any of the Company's subsidiaries or affiliates; or
(vi) any material noncompliance by the Executive (or by any
employee of the Company who reports to the Executive with the knowledge of the
Executive and where the Executive allows or fails to prevent such noncompliance
by such employee) with any provision of any employee handbook, code of business
conduct and ethics or corporate governance guidelines, or any rule, policy or
procedure, of the Company or any of the Company's subsidiaries or affiliates as
are applicable to the Executive and currently in effect or as may hereafter be
in effect from time to time; or
(vii) any breach by the Executive of any provision of this
Agreement; or
(viii) any inaccuracy in or breach of the Executive's
representation and warranty contained in Section 13(r) hereof.
(b) Termination by the Company without Cause. The Company, upon not
less than ninety (90) days' prior written notice to the Executive, may terminate
the Executive's employment with the Company without Cause.
(c) Termination by the Executive for Good Reason. The Executive, upon
not less than ninety (90) days' prior written notice to the Company, may
terminate his employment with the Company for Good Reason. For purposes of this
Agreement, "Good Reason" is defined as any material breach by the Company of any
provision of this Agreement.
(d) Termination by the Executive without Good Reason. The Executive,
upon not less than ninety (90) days' prior written notice to the Company, may
terminate his employment with the Company without Good Reason.
5
(e) Termination in the Event of Death or Disability. The Executive's
employment with the Company shall terminate immediately upon the death of the
Executive. The Executive's employment with the Company may be terminated
immediately by the Company in the event of the occurrence of a Disability of the
Executive. For purposes of this Agreement, a "Disability" shall be defined as an
illness or a physical or mental disability or incapacity of the Executive such
that the Executive has not been able to perform the essential functions of his
position under this Agreement (as reasonably determined by the Company), with or
without reasonable accommodation, for at least sixty (60) days during any one
(1) year period, including, but not limited to, any reasonable determination by
the Company of alcoholism or drug, chemical or substance abuse or addiction by
the Executive. A Disability may, but is not required to, be evidenced by a
signed, written opinion of an independent, qualified medical doctor selected by
the Board of Directors or the Chairman of the Company and paid for by the
Company. The Executive hereby agrees to make himself promptly available for
examination by such medical doctor upon reasonable request by the Board of
Directors or the Chairman and consents to provide promptly the results of such
examination and any diagnosis to the Company. Nothing in this Section is
intended to be in violation of the Americans with Disabilities Act.
(f) Termination by the Executive in the Event of a Change in Control.
Following a Change in Control (as hereinafter defined), the Executive, upon not
less than thirty (30) days' prior written notice to the Company, may terminate
his employment with the Company upon the occurrence of any of the following
events during the six (6) month period immediately following a Change in
Control:
(i) a material reduction in the Executive's duties or
responsibilities from those in effect on the day before the Change in Control,
or
(ii) a material breach of any provision of this Agreement by the
Company.
For purposes of this Agreement, a "Change in Control" shall mean a
transaction or series of related transactions pursuant to which (i) at least
fifty-one percent (51%) of the outstanding shares of common stock of the
Company, on a fully diluted basis, shall subsequent to the date of this
Agreement be owned by any Person (as hereinafter defined) unrelated to or
unaffiliated with the Company, (ii) the Company merges into, consolidates with
or effects any plan of share exchange or other combination with any Person
unrelated to or unaffiliated with the Company in a transaction where the holders
of voting shares of the Company immediately prior to the transaction do not hold
a majority of the voting shares of the surviving entity immediately following
such transaction, or (iii) the Company disposes of all or substantially all of
its assets other than in the ordinary course of business.
Notwithstanding the foregoing, for purposes of the definition of
"Change in Control," (x) a Person shall not include the Chromcraft Revington,
Inc. Employee Stock Ownership Plan Trust which forms a part of the Chromcraft
Revington, Inc. Employee Stock Ownership Plan (collectively, the "ESOP"), or any
other employee benefit plan sponsored by the Company, or any subsidiary or
affiliate of the Company, (y) the outstanding shares of common stock of the
Company, on a fully diluted basis, shall include all shares owned by the ESOP,
whether allocated or unallocated to the accounts of participants, and (z) a
transaction or a series of transactions pursuant to which the Company is taken
private or no longer has shares of stock that are listed for trading on any
securities exchange or market.
(g) Limited Right to Cure. In the event that the Company desires to
terminate the Executive's employment for Cause pursuant to Sections 4(a)(i),
4(a)(vi) or 4(a)(vii) hereof, the Company shall first deliver to the Executive a
written notice which shall (A) indicate the specific provisions of this
Agreement relied upon for such termination, (B) set forth in reasonable detail
the facts and circumstances claimed to provide the grounds for such termination,
and (C) describe the steps, actions, events or other items that must be taken,
completed or followed by the Executive to correct or cure the grounds for such
6
termination. The Executive shall then have thirty (30) days following the
effective date of such notice to fully correct and cure the grounds for the
termination of his employment to the reasonable satisfaction of the Board of
Directors. If the Executive does not fully correct and cure such grounds within
such thirty (30) day period, then the Company shall have the right to terminate
the Executive's employment with the Company immediately for Cause upon
delivering to the Executive written notice of such fact, and the Executive shall
have no further cure period with respect thereto. Notwithstanding the foregoing
and regardless of the grounds for the termination, the Executive shall be
entitled to so correct and cure only one (1) time during the Term, unless the
Board of Directors of the Company has reasonably determined that the grounds for
termination were incorrect or inapplicable, in which case the Executive shall
still have the ability to correct and cure one (1) time during the Term.
In the event that the Executive desires to terminate his employment
with the Company for Good Reason pursuant to Section 4(c) hereof, the Executive
shall first deliver to the Company a written notice which shall (A) indicate the
specific provisions of this Agreement relied upon for such termination, (B) set
forth in reasonable detail the facts and circumstances claimed to provide the
grounds for such termination, and (C) describe the steps, actions, events or
other items that must be taken, completed or followed by the Company to correct
or cure the grounds for such termination. The Company shall then have thirty
(30) days following the effective date of such notice to fully correct and cure
the grounds for the Executive's termination of his employment to the reasonable
satisfaction of the Executive. If the Company does not fully correct and cure
such grounds within such thirty (30) day period, then the Executive shall have
the right to terminate his employment with the Company immediately for Good
Reason upon delivering to the Company written notice of such fact, and the
Company shall have no further cure period with respect thereto. Notwithstanding
the foregoing and regardless of the grounds for the termination, the Company
shall be entitled to so correct and cure only one (1) time during the Term,
unless the Board of Directors of the Company has reasonably determined that the
grounds for termination were incorrect or inapplicable, in which case the
Company shall still have the ability to correct and cure one (1) time during the
Term.
(h) Continuing Obligations. Any termination of the Executive's
employment with the Company in accordance with Section 1(b) hereof or this
Section 4 shall not affect either the Company's obligation to make the payments
required under Section 5 of this Agreement (except as expressly provided herein)
or the Executive's covenants and agreements under Sections 6, 7, 8 or 9 of this
Agreement.
Section 5. Payment Upon Termination of Employment. Upon the termination
of the Executive's employment with the Company pursuant to Section 1(b) or
Section 4 hereof, the Executive shall receive, subject to Sections 5(g) and
5(h), the following in accordance with the appropriate subsection below:
(a) Termination by the Company for Cause or by the Executive without
Good Reason. Upon the termination of the Executive's employment by the Company
for Cause pursuant to Section 4(a) hereof or by the Executive without Good
Reason pursuant to Section 4(d) hereof, the Company shall pay to the Executive
(i) that portion of his Base Salary earned through his last day of employment
with the Company on its next regularly scheduled payroll date, (ii) a severance
payment in a single lump sum equal to the Executive's monthly Base Salary for
three (3) months (provided, however, that if the Executive terminates his
employment with the Company without Good Reason prior to the second anniversary
of the date of this Agreement as set forth in Sections 7(b) and 8(b) hereof or
if the Company terminates the Executive's employment for Cause pursuant to
Section 4(a)(viii), then the Company shall not be required to make any severance
payment to the Executive), (iii) all amounts that are fully vested and properly
payable on or before his last day of employment with the Company under all
retirement plans sponsored by the Company in accordance with the provisions of
such plans, and (iv) all other
7
amounts that are properly payable to the Executive by the Company that have not
been paid to him on or before his last day of employment. The foregoing amounts
shall be paid to the Executive within sixty (60) days following his last day of
employment with the Company, unless provided otherwise by the ESOP or by a
retirement, incentive compensation or other plan of the Company.
In addition, all outstanding awards of cash bonuses, stock options,
restricted stock and other incentive compensation (whether cash or equity based)
shall vest and be paid or distributed to, or be exercisable by, as the case may
be, the Executive in accordance with (I) the incentive compensation plan
applicable to the such award (an "Incentive Plan"), (II) the applicable written
agreement between the Company and the Executive relating to an incentive
compensation award (an "Award Agreement"), or (III) in the absence of an
Incentive Plan or an Award Agreement relating to a particular award, as
determined by the Board of Directors (or a committee thereof) or the Chairman of
the Company.
(b) Termination by the Company Without Cause or by the Executive for
Good Reason. Upon the termination of the Executive's employment by the Company
without Cause pursuant to Section 4(b) hereof or by the Executive for Good
Reason pursuant to Section 4(c) hereof, the Company shall pay to the Executive
(i) that portion of his Base Salary earned through the last day of employment
with the Company on its next regularly scheduled payroll date, (ii) a severance
payment equal to the Executive's monthly Base Salary for a period of the earlier
of twelve (12) months following the Executive's last day of employment with the
Company or the Executive's first day of employment by a new employer (but in the
case of the latter event only so long as such employment by a new employer does
not violate the Executive's non-competition covenants set forth in Section 7 of
this Agreement), (iii) all amounts that are fully vested and properly payable on
or before his last day of employment under all retirement plans sponsored by the
Company in accordance with the provisions of such plans, and (iv) all other
amounts that are properly payable to the Executive by the Company that have not
been paid to him on or before his last day of employment. The foregoing monthly
severance payment shall begin within thirty (30) days following the Executive's
last day of employment with the Company and all other amounts shall be paid to
the Executive within sixty (60) days of his last day of employment, unless
provided otherwise by the ESOP or by a retirement, incentive compensation or
other plan of the Company.
In addition, all outstanding awards of cash bonuses, stock options,
restricted stock and other incentive compensation (whether cash or equity based)
shall vest and be paid or distributed to, or be exercisable by, as the case may
be, the Executive in accordance with (I) the applicable Incentive Plan, (II) the
applicable Award Agreement, or (III) in the absence of an Incentive Plan or an
Award Agreement relating to a particular award, as determined by the Board of
Directors (or a committee thereof) or the Chairman of the Company.
(c) Termination Upon Death of the Executive. Upon the death of the
Executive, the Company shall pay to the Executive's estate (i) that portion of
the Executive's Base Salary earned through the date of his death on its next
regularly scheduled payroll date, (ii) all amounts that are fully vested and
properly payable on or before his date of death under all retirement plans of
the Company in accordance with the provisions of such plans, and (iii) all other
amounts that are properly payable to the Executive by the Company that have not
been paid to him on or before his date of death. The foregoing amounts shall be
paid to the Executive's estate or authorized representative within sixty (60)
days following his death, unless provided otherwise by the ESOP or by a
retirement, incentive compensation or other plan of the Company.
In addition, all outstanding awards of cash bonuses, stock options,
restricted stock and other incentive compensation (whether cash or equity based)
shall vest and be paid or distributed to, or be exercisable by, as the case may
be, the Executive's estate or authorized representative in accordance with (I)
the applicable Incentive Plan, (II) the applicable Award Agreement, or (III) in
the absence of an
8
Incentive Plan or an Award Agreement relating to a particular award, as
determined by the Board of Directors (or a committee thereof) or the Chairman of
the Company.
(d) Termination Upon a Disability. Upon the termination of the
Executive's employment by the Company upon the occurrence of a Disability
pursuant to Section 4(e) hereof, the Company shall pay to the Executive (i) that
portion of the Executive's Base Salary earned through the date of his last day
of employment with the Company on its next regularly scheduled payroll date,
(ii) a severance payment, payable in a lump sum, equal to the Executive's
monthly Base Salary for three (3) months, (iii) all amounts that are fully
vested and properly payable on or before his last day of employment under all
retirement plans of the Company in accordance with the provisions of such plans,
and (iv) all other amounts that are properly payable to the Executive by the
Company that have not been paid to him on or before his last day of employment.
The foregoing amounts shall be paid to the Executive within sixty (60) days
following his last day of employment with the Company, unless provided otherwise
by the ESOP or by a retirement, incentive compensation or other plan of the
Company.
In addition, all outstanding awards of cash bonuses, stock options,
restricted stock and other incentive compensation (whether cash or equity based)
shall vest and be paid or distributed to, or be exercisable by, as the case may
be, the Executive in accordance with (I) the applicable Incentive Plan, (II) the
applicable Award Agreement, or (III) in the absence of an Incentive Plan or an
Award Agreement relating to a particular award, as determined by the Board of
Directors (or a committee thereof) or the Chairman of the Company.
(e) Termination Upon No Extension of Term. Upon the termination of the
Executive's employment upon either the Company or the Executive providing the
notice contemplated by Section 1(b) hereof that the Term of the Executive's
employment shall not be extended, the Company shall pay to the Executive (i)
that portion of his Base Salary earned through the last day of employment with
the Company on its next regularly scheduled payroll date, (ii) in the event the
Company elects not to extend the Term of the Executive's employment, a severance
payment equal to the Executive's monthly Base Salary for a period of the earlier
of twelve (12) months following the Executive's last day of employment with the
Company or the Executive's first day of employment by a new employer (but in the
case of the latter event only so long as such employment by a new employer does
not violate the Executive's non-competition covenants set forth in Section 7 of
this Agreement), or in the event the Executive elects not to extend the Term of
the Executive's employment, a severance payment in a single lump sum equal to
the Executive's monthly Base Salary for three (3) months, (iii) all amounts that
are fully vested and properly payable on or before his last day of employment
under all retirement plans sponsored by the Company in accordance with the
provisions of such plans, and (iv) all other amounts that are properly payable
to the Executive by the Company that have not been paid to him on or before his
last day of employment. The foregoing monthly severance payment shall begin
within thirty (30) days following the Executive's last day of employment with
the Company and other amounts shall be paid to the Executive within sixty (60)
days of his last day of employment, unless provided otherwise by the ESOP or by
a retirement, incentive compensation or other plan of the Company.
In addition, all outstanding awards of cash bonuses, stock options,
restricted stock and other incentive compensation (whether cash or equity based)
shall vest and be paid or distributed to, or be exercisable by, as the case may
be, the Executive in accordance with (I) the applicable Incentive Plan, (II) the
applicable Award Agreement, or (III) in the absence of an Incentive Plan or an
Award Agreement relating to a particular award, as determined by the Board of
Directors (or a committee thereof) or the Chairman of the Company.
(f) Termination by the Executive following a Change in Control. Upon
the termination of the Executive's employment by the Executive following a
Change in Control pursuant to Section 4(f)
9
hereof, the Company shall pay to the Executive (i) that portion of his Base
Salary earned through the last day of employment with the Company, (ii) a
severance payment equal to the Executive's monthly Base Salary for a period of
the earlier of twelve (12) months following the Executive's last day of
employment with the Company or the Executive's first day of employment by a new
employer (but in the case of the latter event only so long as such employment by
a new employer does not violate the Executive's non-competition covenants set
forth in Section 7 of this Agreement), (iii) all amounts that are fully vested
and properly payable on or before his last day of employment under all
retirement plans sponsored by the Company in accordance with the provisions of
such plans, and (iv) all other amounts that are properly payable to the
Executive by the Company that have not been paid to him on or before his last
day of employment. The foregoing monthly severance payment shall begin within
thirty (30) days following the Executive's last day of employment with the
Company and other amounts shall be paid to the Executive within sixty (60) days
of his last day of employment with the Company, unless provided otherwise by the
ESOP or by a retirement, incentive compensation or other plan of the Company.
In addition, all outstanding awards of cash bonuses, stock options,
restricted stock and other incentive compensation (whether cash or equity based)
shall vest and be paid or distributed to, or be exercisable by, as the case may
be, the Executive simultaneously with a Change in Control unless expressly
provided otherwise in (I) the applicable Incentive Plan, or (II) the applicable
Award Agreement.
(g) COBRA Coverage. If the Executive is participating in the Company's
group health plan at the time of his termination of employment and he elects to
continue such coverage for himself and/or his spouse and legal dependents under
the Consolidated Omnibus Budget Reconciliation Act of 1986, as amended
("COBRA"), the Executive shall pay the premiums associated with such continued
coverage and the Company shall reimburse the Executive only for the premiums
actually paid by him associated with such continued coverage until the earlier
of (i) the expiration of the period of time that the Executive has elected to
receive continued coverage under the Company's group health plan pursuant to
COBRA (but, in any event, not to exceed twelve (12) months following his last
day of employment with the Company), or (ii) the date on which the Executive
becomes eligible to receive health insurance benefits from a new employer (but
only so long as such employment by a new employer is not in violation of the
Executive's non-competition covenants set forth in Section 7 of this Agreement).
The foregoing reimbursement of premiums shall be paid to the Executive only if
his employment with the Company is terminated by the Company without Cause, by
the Executive for Good Reason, by the Company in the event of a Disability of
the Executive, by the Company in the event the Company elects not to extend the
Term of the Executive's employment or by the Executive following a Change in
Control, and upon the condition that the Executive makes an appropriate election
under COBRA.
(h) Certain Other Matters. Notwithstanding the foregoing provisions of
this Section 5, the following shall apply:
(i) The Executive understands and agrees that the severance
payments and the reimbursement for the premiums associated with the COBRA
continuation coverage under this Section 5 shall constitute adequate
consideration for his covenants and agreements set forth in Section 6
(Non-Disclosure, etc.), Section 7 (Non-Competition), Section 8
(Non-Solicitation) and Section 9 (Intellectual Property) of this Agreement.
(ii) Upon any termination of the Executive's employment, the
Executive shall execute (and not subsequently rescind or revoke) a release
substantially similar to the release attached to this Agreement as Exhibit A.
(iii) The Company's obligation to make any severance payment or to
make any reimbursement for the premiums associated with the COBRA continuation
coverage to the Executive
10
under this Section 5 shall terminate immediately without reinstatement of any
obligation of the Company to resume paying or reimbursing the Executive
hereunder if the Executive breaches any of the provisions of this Agreement
(including, but not limited to, any of the provisions of Sections 6, 7, 8 or 9)
or refuses to execute (or rescinds or revokes) the release attached to this
Agreement as Exhibit A. Notwithstanding any such termination of the Company's
obligation to pay or reimburse, (a) the covenants of the Executive set forth in
Sections 6, 7, 8 and 9 hereof shall continue in full force and effect and be
binding upon the Executive, and (b) the Company shall be entitled to the
remedies specified in Section 12 hereof, among others.
(iv) In the event of any termination of the Executive's employment
that requires prior written notice from either party, the Company shall during
such thirty (30) or ninety (90) day notice period, as applicable, continue to
pay the Executive his Base Salary but may, in its discretion, elect to direct
the Executive not to report to work.
(v) In the event the Company gives notice to the Executive of its
intent to terminate the Executive's employment because the Company (or the
division to which he has been assigned) will cease operations, then the
Executive shall be entitled to receive the severance payments provided by this
Section 5 only if the Executive remains as an employee of the Company (or the
division to which he has been assigned) until such time as the Company (or the
division) has actually ceased operations.
(vi) If the Company becomes obligated to make monthly severance
payments to the Executive pursuant to this Section 5 (the "Monthly Severance
Payments") and the Executive obtains an employee, consulting or similar position
with another entity without breaching his non-competition covenants provided in
Section 7 hereof, then the Monthly Severance Payments shall terminate or be
reduced as set forth in this paragraph. For purposes of this paragraph, the "New
Monthly Compensation" shall mean the monthly base salary, consulting fee or
other compensation associated with the Executive's new position with another
entity. In the event that the Executive's New Monthly Compensation is equal to
or greater than the Executive's monthly Base Salary on his last day of
employment with the Company, then the Company's obligation to pay additional
Monthly Severance Payments shall immediately terminate. In the event that the
Executive's New Monthly Compensation is less than the Executive's monthly Base
Salary on his last day of employment, then the Monthly Severance Payments shall
be reduced for the period that the Company is obligated to make any severance
payments such that the Monthly Severance Payments shall equal solely the amount
by which the Executive's monthly Base Salary on his last day of employment
exceeds the New Monthly Compensation.
If the Company's obligation to pay Monthly Severance Payments has been
terminated or reduced as provided in the foregoing paragraph, such obligation
shall not thereafter be reinstated or increased, in whole or in part, and shall
not affect the Executive's covenants under Sections 6, 7, 8 or 9 of this
Agreement. The Executive shall promptly provide written notice to the Company of
his new position with another entity, which shall include an adequate
confirmation of his New Monthly Compensation. If the Executive's employment with
the Company is terminated for any reason (whether by the Company or the
Executive), he shall use his best efforts to obtain a new position (but without
breaching his non-competition covenants set forth in Section 7 hereof) with
another employer or entity. In addition, the Executive shall not do any act or
thing relating to any new position or his New Monthly Compensation to circumvent
the operation of the foregoing paragraph.
Section 6. Non-Disclosure; Return of Confidential Information and Other
Property; Compliance with Laws.
(a) Confidential Information; Non-Disclosure. At all times while the
Executive is employed by the Company or any of the Company's subsidiaries or
affiliates and at all times thereafter, the
11
Executive shall not (i) directly or indirectly disclose, provide or discuss any
Confidential Information with or to any Person other than those directors,
officers, employees, representatives and agents of the Company or any of the
Company's subsidiaries or affiliates who need to know such Confidential
Information for a proper corporate purpose, and/or (ii) directly or indirectly
use any Confidential Information (A) to compete against the Company or any of
the Company's subsidiaries or affiliates, (B) to the detriment of the Company or
any of the Company's subsidiaries or affiliates, or (C) for the Executive's own
benefit or for the benefit of any Person other than the Company or any of the
Company's subsidiaries or affiliates. The Executive agrees that all Confidential
Information is and at all times shall remain the property of the Company or any
of the Company's subsidiaries or affiliates, as applicable.
For purposes of this Agreement, the term "Confidential Information"
means any and all of the following, whether provided or disclosed to the
Executive, prepared by the Executive or to which the Executive has been provided
access by the Company or any of its representatives or agents, regardless of
whether on, before or after the date of this Agreement:
(i) any and all materials, records, data, documents, lists and
information (whether in writing, printed, verbal, electronic, computerized, on
disk, CD, DVD or otherwise) (A) relating or referring in any manner to the
business, operations, affairs, financial condition, results of operation,
assets, liabilities, sales, revenues, income, estimates, projections, budgets,
policies, strategies, techniques, methods, products, developments, suppliers,
vendors, relationships and/or customers of the Company or any of the Company's
subsidiaries or affiliates that are confidential, proprietary or not otherwise
publicly available (other than through a breach of this Agreement by the
Employee or any other impermissible disclosure), or (B) that the Company or any
of the Company's subsidiaries or affiliates has deemed confidential, proprietary
or nonpublic; and
(ii) without limiting the foregoing, any and all material nonpublic
information of the Company within the meaning and intent of the federal
securities laws; and
(iii) without limiting the foregoing, any and all trade secrets of
the Company or any of the Company's subsidiaries or affiliates; and
(iv) any and all copies, summaries, analyses, extracts, documents
or information (whether prepared by the Company, the Employee or otherwise)
which relate or refer to or reflect any of the items set forth in (i), (ii) or
(iii) above.
(b) Return of Confidential Information and Other Property. The
Executive covenants and agrees (i) to return promptly to the Company all
Confidential Information that is still in the Executive's possession or control
on his last day of employment with the Company or the location of which the
Employee knows (including, but not limited to, any Confidential Information
contained on the Executive's personal or home computer), and (ii) to return
promptly to the Company, at the Company's headquarters, all vehicles, equipment,
computers, credit cards, keys, access cards, passwords and other property of the
Company that are still in the Executive's possession or control on his last day
of employment or the location of which the Employee knows, and to cease using
any of the foregoing on and after his last day of employment.
(c) Compliance with Laws. The Executive agrees, and shall ensure, that
his performance of his duties and responsibilities under this Agreement shall be
in compliance with all laws, rules, regulations and other legal requirements.
The Executive also agrees to comply with the Company's code of business conduct
and ethics as currently in effect or as may hereafter be in effect from time to
time. In addition, the Executive acknowledges and understands that, in the
course of his performance of duties and responsibilities under this Agreement,
he may be provided or have access to Confidential Information.
12
Accordingly, the Executive shall not use such information as a basis to
purchase, sell, hold or otherwise deal in any securities of the Company or to
otherwise violate any federal or state securities laws.
Section 7. Non-Competition.
(a) The Executive hereby understands, acknowledges and agrees that, by
virtue of his position at the Company, he has or will have advantageous
familiarity and personal contacts with the suppliers, vendors, employees and
customers (wherever located) of the Company and its subsidiaries or affiliates
and has and will have advantageous familiarity with the Confidential Information
and the business, operations, affairs and strategies of the Company and its
subsidiaries or affiliates. Accordingly, at all times while the Executive is
employed by the Company and for a period of one (1) year following his last day
of employment with the Company in the manner described in Section 7(b), the
Executive shall not, in any location within the United States of America,
directly or indirectly, or individually or together with any other Person, as
owner, shareholder, investor, member, partner, proprietor, principal, director,
officer, employee, manager, agent, representative, independent contractor,
consultant or otherwise:
(i) engage in, or assist another Person in engaging in, any
business, operation or activity which competes with any business, operation or
activity that is conducted or actively being developed or pursued by the Company
or any of its subsidiaries or affiliates (or which is in the same or a similar
line of business as the Company or any of its subsidiaries or affiliates) on his
last day of employment with the Company or that was conducted or actively being
developed or pursued by the Company or any of its subsidiaries or affiliates at
any time during the one (1) year period preceding his last day of employment
with the Company; or
(ii) finance, operate or control any business, operation or
activity which competes with any business, operation or activity that is
conducted or actively being developed or pursued by the Company or any of its
subsidiaries or affiliates (or which is in the same or a similar line of
business as the Company or any of its subsidiaries or affiliates) on his last
day of employment with the Company or that was conducted or actively being
developed or pursued by the Company or any of its subsidiaries or affiliates at
any time during the one (1) year period preceding his last day of employment
with the Company; or
(iii) offer or provide employment, hire or engage (whether on a
full-time, part-time or consulting basis or otherwise) any individual who is an
employee of the Company or any of its subsidiaries or affiliates on the last day
of the Executive's employment with the Company or who was such an employee at
any time during the one (1) year period preceding the Executive's last day of
employment with the Company.
(b) The covenants and agreements of the Executive set forth in Section
7(a) shall apply as follows:
(i) If the Executive terminates his employment with the Company
without Good Reason prior to the second anniversary of the date of this
Agreement and if upholstered products constitute less than 20% of the Company's
consolidated sales on the Executive's last day of employment, then during the
one (1) year period following his last day of employment with the Company, the
covenants and agreements of the Executive set forth in Section 7(a) shall not
apply to any subsequent employment, position or activities of the Executive
relating to the sale of upholstered furniture for or on behalf of a Person
(other than the Company or one of its subsidiaries or affiliates) whose sales of
upholstered furniture constitute at least 80% of such Person's total sales or
revenues (with the covenants and agreements in Section 7(a) being applicable to
and binding upon the Executive in all other respects);
13
provided, however, that during such one (1) year period following the
Executive's last day of employment with the Company, the Executive shall not
directly solicit or encourage any Person to whom CRI or any of its subsidiaries
or affiliates sells upholstered furniture for the specific purpose of having
such Person remove placement of any furniture sold by CRI or any of its
subsidiaries or affiliates and replace such furniture with another product.
(ii) In the event of any other termination of the Executive's
employment with the Company (including, but not limited to, a termination by the
Executive of his employment with the Company without Good Reason prior to the
second anniversary of the date of this Agreement and if upholstered products
constitute more than 20% of the Company's consolidated sales on his last day of
employment or a termination by the Executive of his employment with the Company
without Good Reason following the second anniversary of the date of this
Agreement), then the covenants and agreements of the Executive set forth in
Section 7(a) shall apply to and be binding upon the Executive as provided
therein for a period of one (1) year following the Executive's last of
employment with the Company.
(c) The Executive acknowledges the nationwide scope of the business of
the Company and its subsidiaries or affiliates. Nevertheless, in the event that
any provision of this Section 7 is found by a court of competent jurisdiction to
exceed the geographic or other restrictions permitted by applicable law, then
the court shall have the power to reduce, limit or reform (but not to increase
or make greater) such provision to make it enforceable to the maximum extent
permitted by law, and such provision shall then be enforceable against the
Executive in its reduced, limited or reformed manner. By way of example and not
in limitation of the foregoing, the covenants of the Executive set forth in this
Section may be limited to the geographic areas consisting of one hundred (100)
miles from each city, town, village, municipality or other location in the
United States of America in which the Company or any of its subsidiaries or
affiliates maintains an office, manufacturing facility, warehouse or showroom on
the Executive's last day of employment with the Company.
In addition, the Company and the Executive agree that the provisions of
this Section 7 shall be severable in accordance with Section 13(e) hereof.
Section 8. Non-Solicitation.
(a) The Executive hereby understands, acknowledges and agrees that, by
virtue of his position at the Company, he has and will have advantageous
familiarity and personal contacts with the suppliers, vendors, employees and
customers (wherever located) of the Company and its subsidiaries or affiliates
and has and will have advantageous familiarity with the Confidential Information
and the business, operations, affairs and strategies of the Company and its
subsidiaries or affiliates. Accordingly, at all times while the Executive is
employed by the Company and for a period of one (1) year following his last day
of employment with the Company in the manner described in Section 8(b), the
Executive shall not, directly or indirectly, or individually or together with
any other Person, as owner, shareholder, investor, member, partner, proprietor,
principal, director, officer, employee, manager, agent, representative,
independent contractor, consultant or otherwise:
(i) solicit in any manner, seek to obtain, service or accept any
business of any Person who is a customer of the Company or any of its
subsidiaries or affiliates on the Executive's last day of employment with the
Company or who was an existing or prospective customer of the Company or any of
its subsidiaries or affiliates at any time during the one (1) year period
preceding the Executive's last day of employment; or
(ii) request or advise any Person who is a customer, supplier,
vendor or otherwise
14
doing business with the Company or any of its subsidiaries or affiliates on the
Executive's last day of employment with the Company, or who was an existing or
prospective customer of the Company or any of its subsidiaries or affiliates at
any time during the one (1) year period preceding the Executive's last day of
employment, to terminate, reduce, limit or change their business or relationship
with the Company or any of its subsidiaries or affiliates; or
(iii) induce, request or attempt to influence any Person who is
employed by the Company or any of its subsidiaries or affiliates on the
Executive's last day of employment with the Company to terminate the employee's
employment with the Company or any of its subsidiaries or affiliates.
(b) The covenants and agreements of the Executive set forth in Section
8(a) shall apply as follows:
(i) If the Executive terminates his employment with the Company
without Good Reason prior to the second anniversary of the date of this
Agreement and if upholstered products constitute less than 20% of the Company's
consolidated sales on the Executive's last day of employment, then during the
one (1) year period following his last day of employment with the Company, the
covenants and agreements of the Executive set forth in Section 8(a) shall not
apply to any subsequent employment, position or activities of the Executive
relating to the sale of upholstered furniture for or on behalf of a Person
(other than the Company or one of its subsidiaries or affiliates) whose sales of
upholstered furniture constitute at least 80% of such Person's total sales or
revenues (with the covenants and agreements in Section 8(a) being applicable to
and binding upon the Executive in all other respects); provided, however, that
during such one (1) year period following the Executive's last day of employment
with the Company, the Executive shall not directly solicit or encourage any
Person to whom CRI or any of its subsidiaries or affiliates sells upholstered
furniture for the specific purpose of having such Person remove placement of any
furniture sold by CRI or any of its subsidiaries or affiliates and replace such
furniture with another product.
(ii) In the event of any other termination of the Executive's
employment with the Company (including, but not limited to, a termination by the
Executive of his employment with the Company without Good Reason prior to the
second anniversary of the date of this Agreement and if upholstered products
constitute more than 20% of the Company's consolidated sales on his last day of
employment or a termination by the Executive of his employment with the Company
without Good Reason following the second anniversary of the date of this
Agreement), then the covenants and agreements of the Executive set forth in
Section 8(a) shall apply to and be binding upon the Executive as provided
therein for a period of one (1) year following the Executive's last of
employment with the Company.
(c) The Executive acknowledges the nationwide scope of the business of
the Company and its subsidiaries or affiliates. Nevertheless, in the event that
any provision of this Section 8 is found by a court of competent jurisdiction to
exceed the time, geographic or other restrictions permitted by applicable law,
then the court shall have the power to reduce, limit or reform (but not to
increase or make greater) such provision to make it enforceable to the maximum
extent permitted by law, and such provision shall then be enforceable against
the Executive in its reduced, limited or reformed manner.
In addition, the Company and the Executive agree that the provisions of
this Section 8 shall be severable in accordance with Section 13(e) hereof.
Section 9. Intellectual Property. The Executive understands,
acknowledges and agrees that each and every invention, discovery, improvement,
device, design, apparatus, practice, process, method,
15
technique or product (whether or not patentable or copyrightable) made, created,
developed, perfected, devised, conceived, worked on or first reduced to practice
by the Executive, either solely or in collaboration with others, during the
period of the Executive's employment with the Company (whether or not during
regular working hours) relating, directly or indirectly, to the business,
operations, affairs, products, practices, techniques or methods of the Company
or any of its subsidiaries or affiliates (the "Developments") is and shall be
the exclusive property of the Company or its subsidiaries or affiliates, as
applicable. The Executive hereby assigns and agrees to assign to the Company or
any of its subsidiaries or affiliates, as applicable, any and all of the
Executive's right, title and interest in and to any and all Developments and
hereby forever and unconditionally releases and relinquishes any and all rights
that he may have with respect to any and all of the Developments.
Section 10. Periods of Noncompliance and Reasonableness of Periods. The
restrictions and covenants contained in Sections 7 and 8 of this Agreement shall
be deemed not to run during all periods of noncompliance, the intention of the
parties hereto being to have such restrictions and covenants apply during the
full periods specified in Sections 7 and 8 of this Agreement. The Company and
the Executive understand, acknowledge and agree that the restrictions and
covenants contained in Section 7 and Section 8 of this Agreement are reasonable
in view of the Executive's position at the Company, the competitive and
confidential nature of the information of which the Executive has or will have
knowledge and the competitive and the nature of the business in which the
Company and its subsidiaries and affiliates are or may be engaged.
Section 11. Survival of Certain Provisions. Upon any termination of the
Executive's employment with the Company, both the Company and the Executive
hereby agree that Sections 1, 2, 3 and 4 of this Agreement shall terminate and
be of no force or effect (except for the definitions of capitalized terms
specified in such sections) and that Sections 5, 6, 7, 8, 9, 10, 11, 12 and 13
hereof shall continue to be in full force and effect and binding upon the
Company or the Executive, as the case may be, in accordance with the respective
provisions of such Sections.
Section 12. Certain Remedies. The Executive agrees that the Company
will suffer irreparable damage and injury and will not have an adequate remedy
at law in the event of any actual, threatened or attempted breach by the
Executive of any provision of Sections 6, 7, 8 or 9. Accordingly, in the event
of a breach or a threatened or attempted breach by the Executive of any
provision of Sections 6, 7, 8 or 9, in addition to all other remedies to which
the Company is entitled at law, in equity or otherwise, the Company shall be
entitled to a temporary restraining order, a permanent injunction and/or a
decree of specific performance of any provision of Sections 6, 7, 8 or 9. In
addition, in the event of any breach by the Executive of any provision of
Sections 6, 7, 8, or 9, the Executive shall immediately repay to the Company all
severance payments paid to him under Section 5 hereof and all incentive
compensation vested or paid to him following the Executive's last day of
employment. The parties agree that a bond posted by the Company in the amount of
One Thousand Dollars ($1,000) shall be adequate and appropriate in connection
with such restraining order or injunction and that actual damages need not be
proved by the Company prior to it being entitled to obtain such restraining
order, injunction or specific performance. The foregoing remedies shall not be
deemed to be the exclusive rights or remedies of the Company for any breach of
or noncompliance with this Agreement by the Executive but shall be in addition
to all other rights and remedies available to the Company at law, in equity or
otherwise.
Section 13. Miscellaneous.
(a) Binding Effect; Assignment. This Agreement shall be binding upon
and inure to the benefit of the Company and the Executive and their respective
heirs, executors, representatives, successors and assigns; provided, however
that neither party may assign this Agreement without the prior written consent
of the other party hereto except that the Company may, without the consent of
the
16
Executive, assign this Agreement in connection with any merger, consolidation,
share exchange, combination, sale of stock or assets, dissolution or similar
transaction involving the Company. In the event of any such permitted assignment
of this Agreement, all references to the "Company" shall thereafter mean and
refer to the assignee of the Company.
(b) Waiver. Either party hereto may, by a writing signed by the waiving
party, waive the performance by the other party of any of the covenants or
agreements to be performed by such other party under this Agreement. The waiver
by either party hereto of a breach of or noncompliance with any provision of
this Agreement shall not operate or be construed as a continuing waiver or a
waiver of any other or subsequent breach or noncompliance hereunder. The failure
or delay of either party at any time to insist upon the strict performance of
any provision of this Agreement or to enforce its rights or remedies under this
Agreement shall not be construed as a waiver or relinquishment of the right to
insist upon strict performance of such provision, or to pursue any of its rights
or remedies for any breach hereof, at a future time.
(c) Amendment. This Agreement may be amended, modified or supplemented
only by a written agreement executed by all of the parties hereto.
(d) Headings. The headings in this Agreement have been inserted solely
for ease of reference and shall not be considered in the interpretation or
construction of this Agreement.
(e) Severability. In case any one or more of the provisions (or any
portion thereof) contained herein shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement, but
this Agreement shall be construed as if such invalid, illegal or unenforceable
provision or provisions (or portion thereof) had never been contained herein;
provided, however, if any provision of Section 7 or 8 of this Agreement shall be
determined by a court of competent jurisdiction to be unenforceable because of
the provision's scope, duration, geographic restriction or other factor, then
such provision shall be considered divisible and the court making such
determination shall have the power to reduce or limit (but not increase or make
greater) such scope, duration, geographic restriction or other factor or to
reform (but not increase or make greater) such provision to make it enforceable
to the maximum extent permitted by law, and such provision shall then be
enforceable against the appropriate party hereto in its reformed, reduced or
limited form.
(f) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but such counterparts shall
together constitute one and the same agreement.
(g) Construction. This Agreement shall be deemed to have been drafted
by both parties hereto. This Agreement shall be construed in accordance with the
fair meaning of its provisions and its language shall not be strictly construed
against, nor shall ambiguities be resolved against, any party.
(h) Voluntary Execution. The Executive hereby understands and agrees
that he has executed this Agreement voluntarily.
(i) Entire Agreement. This Agreement, and the plans, programs,
policies, procedures, rules and agreements referenced herein, as well as the
Release attached hereto, constitute the entire understanding and agreement
between the parties hereto relating to the subject matter hereof and thereof and
supersede all other prior understandings, commitments, representations,
negotiations, contracts and agreements, whether oral or written, between the
parties hereto relating to the matters contemplated hereby and thereby.
17
(j) Certain References. Whenever in this Agreement a singular word is
used, it also shall include the plural wherever required by the context and
vice-versa. All references to the masculine, feminine or neuter genders herein
shall include any other gender, as the context requires. Unless expressly
provided otherwise, all references in this Agreement to days shall mean
calendar, not business, days.
(k) Governing Law. Because the Company maintains its principal place of
business in the State of Indiana, this Agreement shall be governed by and
construed in accordance with the laws of the State of Indiana, without reference
to any choice of law provisions, principles or rules thereof (whether of the
State of Indiana or any other jurisdiction) that would cause the application of
any laws of any jurisdiction other than the State of Indiana. Any action to
enforce this Agreement shall be brought only in a court of competent
jurisdiction in the State of Indiana.
(l) Notices. All notices, requests and other communications hereunder
shall be in writing (which shall include facsimile communication) and shall be
deemed to have been duly given if (i) delivered by hand; (ii) sent by certified
United States Mail, return receipt requested, first class postage pre-paid;
(iii) sent by overnight delivery service; or (iv) sent by facsimile transmission
if such fax is confirmed immediately thereafter by also mailing a copy of such
notice, request or other communication by regular (not certified or registered)
United States Mail, first class postage pre-paid, as follows:
If to the Company: Chromcraft Revington, Inc.
Attention: Chairman
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Executive: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------
---------------------------
Telephone: (___) __________
Facsimile: (___) __________
or to such other address or facsimile number as either party hereto may have
furnished to the other in writing in accordance herewith. The Executive shall
promptly provide any changes to his address, telephone number and facsimile
number to the Company.
All such notices, requests and other communications shall be effective
(i) if delivered by hand, when delivered; (ii) if sent by mail in the manner
provided herein, two (2) business days after deposit with the United States
Postal Service; (iii) if sent by overnight delivery service, on the next
business day after deposit with such service; or (iv) if sent by facsimile
transmission, on the date indicated on the fax confirmation page of the sender
if such fax also is confirmed by mail in the manner provided herein.
(m) Attorneys' Fees. The prevailing party in any claim or action (or
any settlement thereof) under this Agreement shall, in addition to such other
relief that a court may award, be entitled to recover its or his, as the case
may be, reasonable attorneys' fees, costs and expenses from the non-prevailing
party.
(n) Recitals. The recitals, premises and "Whereas" clauses contained on
page 1 of this Agreement are expressly incorporated into and made a part of this
Agreement.
18
(o) Definition of Person. For purposes of this Agreement, the term
"Person" shall mean any natural person, proprietorship, partnership,
corporation, limited liability company, organization, firm, business, joint
venture, association, trust or other entity.
(p) Non-disparagement. Following any termination of the Executive's
employment with the Company, the Executive shall not publicly disparage or make
or publish any negative statements or comments about the Company, any of the
Company's subsidiaries or affiliates or any of their respective products,
directors or employees. Following any termination of the Executive's employment
with the Company, and subject to applicable law, no executive officer of the
Company or member of the Company's Board of Directors shall publicly disparage
or make or publish any negative statements or comments about the Executive.
(q) Cooperation. For a period of five (5) years following any
termination of the Executive's employment with the Company and upon the request
of the Company or any of its subsidiaries or affiliates, the Executive shall
reasonably cooperate, assist and make himself available (for testimony or
otherwise) at appropriate times and places as reasonably determined by the
Company or any of its subsidiaries or affiliates in connection with any claim,
demand, action, suit, proceeding, examination, investigation or litigation by,
against or affecting the Company or any of its subsidiaries or affiliates. In
connection with the foregoing, if the Executive has obtained employment
elsewhere and has to take time away from his new employment, then the Company
shall pay the Executive a fee of $1,000 for each day that the Company or any
subsidiary or affiliate of the Company requests the Executive to cooperate,
assist or make himself available, and shall also reimburse the Executive for his
reasonable out-of-pocket travel expenses that are approved in advance by the
Chairman of the Company.
(r) No Other Agreements. The Executive hereby represents and warrants
to the Company that he is not a party to or bound by any other employment
agreement, noncompetition agreement or covenant, nonsolicitation agreement or
covenant or any other agreement or covenant that would restrict, limit or
prevent him from performing his duties and responsibilities for the Company
under this Agreement. In the event the foregoing representation and warranty is
inaccurate or breached in any respect, the Company may, in its discretion,
terminate the Executive's employment with the Company in accordance with Section
4(a)(viii) hereof. In addition, the Executive shall indemnify and reimburse the
Company for any and all claims, demands, damages, liabilities, costs and
expenses (including, but not limited to, its reasonable attorneys fees) incurred
by the Company arising out of or relating to such inaccuracy or breach in the
event that any liability is imposed on the Company by virtue of the Executive
being a party to or bound by any other employment, noncompetition,
nonsolicitation or other agreement or covenant.
* * *
19
IN WITNESS WHEREOF, the Company and the Executive have made, entered
into, executed and delivered this Agreement as of the day and year first above
written.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
CHROMCRAFT REVINGTON, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇-▇▇▇
--------------------------------------
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇-▇▇▇
Chairman
20