Exhibit 10.13
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "AGREEMENT") is
made February 17, 2000 by and between Arkon Safety Equipment, Inc. (the
"COMPANY") and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ("EXECUTIVE").
The Company and the Executive desire to enter into an agreement (i)
defining the relative rights of the Company and the Executive, (ii) setting
forth the obligation of Executive to refrain from competing with the Company
during his employment with the Company and for a period of time thereafter as
provided herein and (iii) setting forth certain terms of Executive's employment
with the Company. This Agreement amends and restates in its entirety the
existing Employment Agreement, by and between the Company and Executive.
The Company is party to a Stock Purchase Agreement, dated February 17,
2000, pursuant to which North Safety Products Ltd. (the "BUYER") is acquiring
all of the outstanding capital stock of the Company (the "STOCK PURCHASE
AGREEMENT"). In consideration of the mutual covenants contained herein and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. EMPLOYMENT. The Company shall employ Executive, and Executive
hereby accepts employment with the Company, upon the terms and conditions set
forth in this Agreement for the period beginning on the date hereof and ending
as provided in paragraph 4 hereof.
2. POSITION AND DUTIES.
(a) During his employment, Executive shall serve as President
and Chief Executive Officer and shall render such administrative, sales,
marketing and other executive and managerial services to the Company and its
Affiliates as the Company's board of directors (the "BOARD") may from time to
time direct.
(b) Executive shall report to the Board, and Executive shall
devote his best efforts and his full business time and attention (except for
permitted vacation periods and reasonable periods of illness or other
incapacity) to the business and affairs of the Company and its Affiliates.
Executive shall perform his duties and responsibilities to the best of his
abilities in a diligent, trustworthy, businesslike and efficient manner.
(c) For purposes of this Agreement, "AFFILIATE" of the
Company means the Buyer and any entity, which is controlled, directly or
indirectly by the Buyer, where "CONTROL" means the possession, directly or
indirectly, of the power to direct the management and policies of such entity.
3. BASE SALARY AND BENEFITS.
(a) During his employment, Executive's base salary shall not
be less than CDN$332,000 per annum or such other rates as the Board may
designate from time to time (the "BASE SALARY"), which salary shall be payable
in regular installments in accordance with the Company's general payroll
practices and shall be subject to customary withholding. In addition, during his
employment, Executive shall be entitled to participate in the Company's employee
benefit programs and Executive shall be entitled to four weeks of paid vacation
each year in accordance with the Company's vacation policy, which if not taken
may not be carried forward to any subsequent year.
(b) The Company shall reimburse Executive for all reasonable
expenses incurred by him in the course of performing his duties under this
Agreement which are consistent with the Company's policies in effect from time
to time with respect to travel, entertainment and other business expenses,
subject to the Company's requirements with respect to reporting and
documentation of such expenses.
(c) In addition to the Base Salary, the Board may, in its
sole discretion, award an incentive bonus to Executive following the end of each
fiscal year during the Executive's employment, which provides for a target bonus
equal to up to 30% of Base Salary based upon Executive's performance and the
Company's operating results during such year if (but only if) Executive remains
employed by the Company at the end of such fiscal year; PROVIDED that not later
than March 31 of each year, the Board shall deliver to Executive the performance
and operating results upon which Executive's target bonus are to be based for
that particular year.
4. TERM.
(a) Unless renewed by the mutual agreement of the Company and
the Executive, the Executive shall be employed for a period beginning on the
date hereof and ending on the fourth anniversary of the date hereof (the
"TERM"); provided that (i) the Executive's employment shall terminate prior to
such date upon Executive's resignation, death or Disability and (ii) the
Executive's employment may be terminated by the Company at any time prior to
such date for Cause (as defined below) or without Cause. The date on which
Executive's employment is terminated is referred to herein as the "TERMINATION
DATE".
(b) If the Executive's employment is terminated by the
Company without Cause or Executive resigns from the Company for Good Reason
prior to the end of the Term, Executive shall be entitled to receive his Base
Salary as of the Termination Date for the 18-month period following the
Termination Date, and if Executive's employment is terminated for a Disability,
Executive shall be entitled to receive his Base Salary as of the Termination
Date for the nine-month period following the Termination Date, in each case if
and only if Executive has not breached the provisions of paragraphs 5, 6 or 7
hereof. As a condition to the Company's obligations to make severance payments
pursuant to this paragraph 4(b), Executive will execute and deliver a general
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release in form and substance set forth as Exhibit A hereto. All payments of
Base Salary pursuant to this paragraph 4(b) shall be payable in regular
installments in accordance with the Company's general payroll practices and
shall be subject to customary withholding.
(c) If the Executive's employment is terminated by the
Company for Cause or is terminated pursuant to paragraph 4(a)(i) above,
Executive shall be entitled to receive his Base Salary through the Termination
Date. As a condition to the Company's obligations (if any) to make severance
payments pursuant to this paragraph 4(c), Executive will execute and deliver a
general release in form and substance set forth as Exhibit A hereto.
(d) All of Executive's rights to fringe benefits and
incentive bonuses hereunder (if any) which accrue or become payable after the
Termination Date shall cease upon such termination; PROVIDED that, unless
otherwise prohibited by the Company's insurance program in place on the
Termination Date, Executive shall be entitled to be insured under the Company's
health insurance program until the end of the calendar year in which Executive
was terminated or, if earlier, the date on which Executive receives comparable
health insurance benefits from another employer.
(e) Executive recognizes and accepts that the Company or the
Affiliates shall not, in any case, be responsible for any additional amount,
indemnity in lieu of notice, severance pay or other damages arising from the
termination of his employment, above and beyond those specifically provided for
herein. The Company may offset any amounts Executive owes it or its Affiliates
against any amounts (other than Base Salary) it owes Executive hereunder.
(f) For purposes of this Agreement, "CAUSE" shall include any
of the following:
(i) a finding by the Board, after notice to Executive and an
opportunity for him to respond, that Executive has committed (A) a
felony, (B) to the extent it could reasonably be considered to
compromise the best interests of the Company or any of its Affiliates
or render Executive unfit or unable to perform his services and duties
hereunder, a misdemeanor (excluding traffic violations), or (C) any
other act or omission involving dishonesty, disloyalty or fraud with
respect to the Company or any of its Affiliates or any of their
customers or suppliers;
(ii) the continued failure by Executive to perform his duties
in all material respects for the Company or any of its Affiliates
continuing for a period of 15 days following a demand for such
performance by the Board, a breach of any representation or warranty
made by Executive in this Agreement or a material breach by Executive
of his obligations under this Agreement continuing uncured (if
curable) for a period of 15 days following notice from the Board,
which demand or notice shall identify in reasonable detail the manner
that Executive has not performed his duties or has breached his
obligations (as applicable) and given Executive an opportunity to
respond;
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(iii) a finding by the Board, after notice to Executive and an
opportunity for him to respond, that Executive engaged in (i)
misconduct materially injurious to the Company or any of its
Affiliates or their reputation or (ii) gross negligence or willful
misconduct with respect to the Company or any of its Affiliates; or
(iv) any other event or circumstance which pursuant to
applicable law, constitutes dismissal for "cause".
(g) For purposes of this Agreement, "DISABILITY" shall mean
the inability, due to illness, accident, injury, physical or mental incapacity
or other disability, of Executive, whether or not arising out of a medical
condition existing prior to the date hereof, to carry out effectively his duties
and obligations to the Company or to participate effectively and actively in the
management of the Company for a period of at least 90 consecutive days or for
shorter periods aggregating at least 120 days (whether or not consecutive)
during any twelve-month period, as determined in the good faith judgment of the
Board.
(h) For purposes of this Agreement, "GOOD REASON" shall mean,
without Executive's consent, (i) a material reduction in Executive's status,
title, position, scope of duties, authority or responsibilities or material and
permanent assignment of duties and responsibilities to Executive which are
inconsistent with or additional to the duties and responsibilities generally
assigned to him, (ii) a reduction (other than a reduction applicable to
executive employees of the Company generally) in Executive's Base Salary or
maximum annual target bonus percentage set forth in Section 3(c), (iii) the
failure to pay to Executive when due his Base Salary or target bonus within 15
days after written demand therefor by Executive, (iv) relocation or transfer of
Executive to a principal place of business which is located more than 25 miles
from the Montreal Urban Community; or (v) the failure of the Company to obtain
an agreement from any successor or assign of the Company to assume and agree to
perform this Agreement.
5. CONFIDENTIAL INFORMATION.
(a) Executive acknowledges that the information, observations
and data obtained by him while employed by the Company (whether prior to or
after the date of the Agreement) concerning the business or affairs of the
Company or any other Affiliate ("CONFIDENTIAL INFORMATION") are the property of
the Company. Therefore, Executive agrees that he shall not disclose to any
unauthorized person or use for his own purposes any Confidential Information
without the prior written consent of the Board, unless and to the extent that
the aforementioned matters become generally known to and available for use by
the public other than as a result of Executive's acts or omissions. Executive
shall deliver to the Company at the Termination Date, or at any other time the
Company may request, all memoranda, notes, plans, records, reports, computer
tapes, printouts and software and other documents and data (and copies thereof)
relating to the Confidential Information, Work Product (as defined below) or the
business of the Company or any Affiliate which he may then possess or have under
his control.
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(b) Executive understands that the Company and its Affiliates
will receive from third parties confidential or proprietary information ("THIRD
PARTY INFORMATION") subject to a duty on the Company's and its Affiliates' part
to maintain the confidentiality of such information and to use it only for
certain limited purposes. During the Employment Period and thereafter, and
without in anyway limiting the provisions of paragraph 5(a) above, Executive
will hold Third Party Information in the strictest confidence and will not
disclose to anyone (other than personnel of the Company or its Affiliates who
need to know such information in connection with their work for the Company or
its Affiliates) or use, except in connection with his work for the Company or
its Affiliates, Third Party Information unless expressly authorized by the Board
in writing.
(c) During the Employment Period, the Executive will not
improperly use or disclose any confidential information or trade secrets, if
any, of any former employers or any other person to whom the Executive has an
obligation of confidentiality, and will not bring onto the premises of the
Company or any of the Company's Affiliates any unpublished documents or any
property belonging to any former employer or any other person to whom the
Executive has an obligation of confidentiality unless consented to in writing by
the former employer or person. The Executive will use in the performance of his
duties only information which is (i) generally known and used by persons with
training and experience comparable to the Executive's and which is (x) common
knowledge in the industry or (y) is otherwise legally in the public domain, (ii)
is otherwise provided or developed by the Company or any of its Subsidiaries or
(iii) in the case of materials, property or information belonging to any former
employer or other person to whom the Executive has an obligation of
confidentiality, approved for such use in writing by such former employer or
person.
6. INVENTIONS AND PATENTS. Executive acknowledges that all
inventions, innovations, improvements, developments, methods, designs, analyses,
drawings, reports and all similar or related information (whether or not
patentable) which relate to the Company's or any of its Affiliates' actual or
anticipated business, research and development or existing or future products or
services and which are conceived, developed or made by Executive while employed
by the Company and its Affiliates (whether prior to or after the date of this
Agreement) ("WORK PRODUCT") belong to the Company or such Affiliates. Executive
shall promptly disclose such Work Product to the Board and perform all actions
reasonably requested by the Board (whether during or after the termination of
his employment) to establish and confirm such ownership (including, without
limitation in assignments, consents, powers of attorney and other instruments)
and shall, on the Termination Date or at any time that the may request in
writing, deliver to the Company all memoranda, notes, records, plans, reports
and other documents (and copies thereof) relating to the business of the Company
and its Affiliates which he may then possess or have under his control.
7. NON-COMPETE, NON-SOLICITATION.
(a) In further consideration of the compensation to be paid
to Executive hereunder, Executive acknowledges that in the course of his
employment with the Company or any of its Affiliates, he shall become familiar
with the Company's and Affiliates' trade secrets and with
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other Confidential Information concerning the Company and its Affiliates and
that his services have been and shall be of special, unique and extraordinary
value to the Company and its Affiliates. Therefore, Executive agrees that,
during his employment with the Company and for five years thereafter (the
"NON-COMPETE PERIOD"), he shall not directly or indirectly own any interest in,
manage, control, participate in, consult with, render services for, or in any
manner engage in any business competing with the business of the Company and its
Affiliates, within the United States or Canada. Nothing herein shall prohibit
Executive from being a passive owner of not more than 5% of the outstanding
stock of any class of a corporation which is publicly traded, so long as
Executive has no active participation in the business of such corporation.
(b) During the Non-compete Period, Executive shall not
directly or indirectly through another entity (i) induce or attempt to induce
any employee of the Company or any Affiliate to leave the employ of the Company
or such Affiliate, or in any way interfere with the relationship between the
Company or any Affiliate and any employee therefore, (ii) unless such person has
been involuntarily terminated by the Company or such Affiliate without Cause,
hire any person who was an employee of the Company or any Affiliate at the time
of the termination of the Executive's employment or during the six months prior
to the termination of the Executive's employment or (iii) induce or attempt to
induce any customer, supplier, licensee, licensor, franchisee or other business
relation of the Company or any Affiliate to do business with Executive (or any
person or entity to whom Executive is rendering services for or acting on its
behalf) or to cease doing business with the Company or such Affiliate, or in any
way interfere with the relationship between any such customer, supplier,
licensee or business relation and the Company or any Affiliate (including,
without limitation, making any negative statements or communications about the
Company or its Affiliates).
(c) If, at the time of enforcement of this paragraph 7, a
court shall hold that the duration, scope or area restrictions stated herein are
unreasonable under circumstances then existing, the parties agree that the
maximum duration, scope or area reasonable under such circumstances shall be
substituted for the stated duration, scope or area and that the court shall be
allowed to revise the restrictions contained herein to cover the maximum period,
scope and area permitted by law. Executive agrees that the restrictions
contained in this paragraph 7 are reasonable under the circumstances existing on
the date hereof.
(d) In the event of the breach or a threatened breach by
Executive of any of the provisions of this paragraph 7, the Company, in addition
and supplementary to other rights and remedies existing in its favor, may apply
to any court of law or equity of competent jurisdiction for specific performance
and/or injunctive or other relief in order to enforce or prevent any violations
of the provisions hereof (without posting abound or other security). In
addition, in the event of an alleged breach or violation by Executive of this
paragraph 7, the Non-compete Period shall be extended for a period of time equal
to the length of such breach or violation.
(e) Executive acknowledges that the provisions of this
paragraph 7 are in consideration of employment with the Company and additional
good and valuable consideration as
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set forth in this Agreement. In addition, Executive agrees and acknowledges that
the restrictions contained in paragraph 7 do not preclude Executive from earning
a livelihood, nor do they unreasonably impose limitations on Executive's ability
to earn a living. In addition, Executive agrees and acknowledges that the
potential harm to the Company of the non-enforcement of paragraph 7 outweighs
any potential harm to Executive of their enforcement by injunction or otherwise.
Executive acknowledges that he has carefully read this Agreement and has given
careful consideration to the restraints imposed upon Executive by this
Agreement, and is in full accord as to their necessity for the reasonable and
proper protection of Confidential Information of the Company now existing or to
be developed in the future. Executive expressly acknowledges and agrees that
each and every restraint imposed by this Agreement is reasonable with respect to
subject matter, time period and geographical area. Executive further
acknowledges that the provisions of this paragraph 7 are separate and
independent of the other paragraphs of this Agreement.
8. EXECUTIVE'S REPRESENTATIONS. Executive hereby represents and
warrants to the Company that (i) the execution, delivery and performance of this
Agreement by Executive do not and shall not conflict with, breach, violate or
cause a default under any contract, agreement, instrument, order, judgment or
decree to which Executive is a party or by which he is bound, (ii) Executive is
not a party to or bound by any employment agreement, non-compete agreement or
confidentiality agreement with any other person or entity and (iii) upon the
execution and delivery of this Agreement by the Company, this Agreement shall be
the valid and binding obligation of Executive, enforceable in accordance with
its terms. Executive hereby acknowledges and represents that he has consulted
with independent legal counsel regarding his rights and obligations under this
Agreement and that he fully understands the terms and conditions contained
herein.
9. SURVIVAL. Paragraphs 5, 6 and 7 and paragraphs 9 through 19 shall
survive and continue in full force in accordance with their terms
notwithstanding any termination of the Executive's employment.
10. NOTICES. Any notice provided for in this Agreement shall be in
writing and shall be either personally delivered, or mailed by first class mail,
return receipt requested, to the recipient at the address below indicated.
NOTICES TO EXECUTIVE:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
c/o 3653048 Canada Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ (▇▇▇▇▇▇)
▇▇▇ ▇▇▇
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NOTICES TO THE COMPANY:
c/o Norcross Safety Products, L.L.C.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇, ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Fax: (▇▇▇)-▇▇▇-▇▇▇▇
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement shall be deemed to have been given when so delivered
or mailed.
11. SEVERABILITY. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if the final determination of a court of competent
jurisdiction decides that any term or provision hereof is invalid or
unenforceable, the term or provision determined to be invalid or unenforceable
shall be severed from this Agreement and the remaining terms and provisions
shall be unimpaired.
12. COMPLETE AGREEMENT. This Agreement embodies the complete
agreement and understanding among the parties and supersedes and preempts any
prior understandings, agreements or representations by or among the parties,
written or oral, which may have related to the subject matter hereof in any way.
13. NO CONTRADICTION. The restrictive covenants which are part of
this Agreement, such as the obligation of non-competition which is set forth at
paragraph 7, shall not be deemed to be in contradiction with the restrictive
covenants which are included in the Stock Purchase Agreement, but shall be in
addition one to another.
14. NO STRICT CONSTRUCTION. The language used in this Agreement shall
be deemed to be the language chosen by the parties hereto to express their
mutual intent, and no rule of strict construction shall be applied against any
party.
15. COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.
16. SUCCESSORS AND ASSIGNS. This Agreement is intended to bind and
inure to the benefit of and be enforceable by Executive, the Company and their
respective heirs, successors and assigns, except that Executive may not assign
his rights or delegate his obligations hereunder without the prior written
consent of the Company.
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17. CHOICE OF LAW. All issues and questions concerning the
construction, validity, enforcement and interpretation of this Agreement and the
exhibits and schedules hereto shall be governed by, and construed in accordance
with, the laws of the Province of Quebec.
18. AMENDMENT AND WAIVER. The provisions of this Agreement may be
amended or waived only with the prior written consent of the Company and
Executive, and no course of conduct or failure or delay in enforcing the
provisions of this Agreement shall affect the validity, binding effect or
enforceability of this Agreement.
19. LANGUAGE. The parties have expressly requested that the present
agreement be drafted in English. LES PARTIES ONT EXPRESSEMENT DEMANDE A CE QUE
LE PRESENT DOCUMENT SOIT REDIGE EN LANGUE ANGLAISE.
20. DISPUTE RESOLUTION. Other than with respect to suits for
injunctive or other equitable relief, any dispute under this Agreement shall be
resolved by instituting, after thirty(30) days written notice to the other
party, an arbitration to be conducted in ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ in accordance
with the arbitration rules (except as modified below) of the Code of Civil
Procedure of Quebec (collectively, the "RULES"). Each of the parties hereto
agrees that such arbitration shall be conducted by a panel of three arbitrators,
one of whom is selected by the Company, one of whom is selected by the Executive
and one of whom is mutually agreeable to both parties; provided that such
arbitrators shall each be a retired judge or other qualified person who is
experienced in deciding cases concerning the matter which is the subject of the
dispute. Each of the parties agrees that in any such arbitration that
pre-arbitration discovery shall be limited to the greatest extent provided by
the Rules, that the award shall be made in writing no more than 30 days
following the end of the proceeding, that the arbitration shall not be conducted
as a class action, that the arbitration award shall not include factual findings
or conclusions of law, that no punitive damages shall be awarded, and that all
facts and circumstances relating to such arbitration, including without
limitation the existence of the dispute and the ultimate resolution, shall be
kept confidential. Any award rendered by the arbitrators shall be final, binding
and sole and exclusive with respect to the subject matter thereof and judgment
may be entered on it in any court of competent jurisdiction. The losing party
shall pay the fees and expenses of both parties and the arbitrators.
Notwithstanding the provisions of this paragraph 20, nothing herein shall be
construed in such a manner as to prevent the Company from terminating Executive
in accordance with the terms of this Agreement; PROVIDED that the basis for such
termination may be the subject of an arbitration proceeding pursuant to this
paragraph 20.
* * * * *
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IN WITNESS WHEREOF, the parties hereto have executed this Employment
Agreement as of this date first written above.
ARKON SAFETY EQUIPMENT, INC.
By: /s/ [ILLEGIBLE]
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Its: Chairman of the Board
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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EXHIBIT A
RELEASE AND DISCHARGE
I, the undersigned, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, domiciled and residing at
_____________________ _____________________________, province of Quebec, in
consideration of the payment by Arkon Safety Equipment Inc. (hereinafter,
"COMPANY") of a gross amount of _________________________________ dollars
($_________), less all applicable deductions, hereby release and forever
discharge the Company, its related entities (including Norcross Safety Products
LLC), their directors, successors, insurers, employees, agents, representatives
and assigns of any and all claims, actions, or causes of action of any nature
whatsoever, past, present or future, including but not limited to those being
directly or indirectly related to my employment with the Company or the
termination thereof.
Without limiting the generality of the foregoing, I recognize that the
said gross amount of ______________________________________ dollars
($___________), to be remitted to me includes all amounts for salary, vacation
pay, payment in lieu of notice, severance pay and any other amounts related to
my employment or the termination thereof to which I may be entitled pursuant to
the LABOUR STANDARDS ACT, the CHARTER OF HUMAN RIGHTS AND FREEDOMS, the CIVIL
CODE OF QUEBEC, or any other applicable law or contract.
The above-mentioned payment will be made without prejudice and in no
way constitutes an admission of liability on the part of the Company. Moreover,
I hereby acknowledge having had the opportunity to seek and obtain counsel and
recognize that the amounts to be remitted to me herein are sufficient and
reasonable.
The present Release and Discharge constitutes a transaction within the
meaning of Article 2631 and following of the CIVIL CODE OF QUEBEC.
I have expressly requested that the present document be drafted in
English. J'AI EXPRESSEMENT DEMANDE QUE LE PRESENT DOCUMENT SOIT REDIGE EN
ANGLAIS.
AND I HAVE SIGNED,
At____________________________, this ______ day of ____________, 200_.
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Name
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Witness
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