Exhibit 10w - Employment Agreement with ▇▇▇▇ ▇▇▇▇▇▇▇▇
BROWNSTONE HOLDINGS, INC.
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT is effective as of the 30th day of
October, 1997 by and between BROWNSTONE HOLDINGS, INC., a Delaware corporation
(hereinafter referred to as "Employer"), a wholly-owned subsidiary of Diplomat
Corporation, a Delaware corporation ("Diplomat") and ▇▇▇▇ ▇▇▇▇▇▇▇▇, (hereinafter
referred to as "Employee");
W I T N E S S E T H:
WHEREAS, Employer desires to employ Employee as Director of
Product Development of the Employer; and
WHEREAS, Employee is willing to be employed as Director of
Product Development of the Employer in the manner provided for herein, and to
perform the duties of Director of Product Development of Employer upon the terms
and conditions herein set forth;
NOW, THEREFORE, in consideration of the promises and mutual
covenants herein set forth it is agreed as follows:
1. Employment of Employee. Employer hereby employs Employee
as Director of Product Development of the Employer.
2. Term. The term of this Agreement shall commence as of the
30th day of October, 1997 (the "Commencement Date") and expire five (5) years
from such date. Each 12 month period from the Commencement Date forward during
the term hereof shall be referred to as an "Annual Period." During the term
hereof, Employee shall devote substantially all of her business time and efforts
to Employer and its subsidiaries and affiliates.
3. Duties. Employee hereby agrees that, throughout the period
of her employment hereunder, she shall devote substantially all of her business
time, attention, knowledge and skills, faithfully, diligently and to the best of
her ability, in furtherance of the business of Employer, shall perform the
duties assigned to her by the officers of Diplomat consistent with her position,
and shall observe and carry out such rules and regulations, policies and
directions as Employer may from time to time establish and consistent with her
position. During the term of this Agreement, Employee shall do such traveling as
may be reasonably required of her in the performance of her duties on behalf of
Employer. Employee shall be available to confer and consult with and advise the
officers and directors of Employer and Diplomat at such times that may be
reasonably required by Employer and Diplomat. Employee shall report directly and
solely to the Chief Executive Officer and Chief Operating Officer of Employer.
4. Compensation.
(a) Employee shall be paid a minimum of $172,500
for each Annual Period. Employee shall be paid periodically in accordance with
the policies of the Employer during the term of this Agreement, but not less
frequently than bi-weekly. Employee is eligible for an annual bonus, if any,
which will be determined and paid in accordance with policies set from time to
time by the Board of Diplomat.
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(b) Employee shall be entitled to participate
in and receive the benefits of all pension, profit-sharing, deferred
compensation, retirement, hospitalization, insurance, medical or dental or other
benefit plan or arrangement generally available to executive employees of
Employer as may now or hereafter exist. Employee shall also be entitled to
participate in or receive all other benefits and perquisites generally available
to senior executives of Employer that may be in effect from time to time during
the Employee's employment hereunder. Employer shall be under no obligation to
institute or continue the existence of any such employee plan, benefit or
perquisite.
5. Expenses. Employer shall reimburse Employee, promptly upon
presentation of receipts or vouchers thereof, for all expenses reasonably
incurred by her, including parking expenses, in connection with the performance
of her duties hereunder and the business of Employer, all in accordance with
policies of Employer from time to time in effect. Employer shall continue
automobile lease payments and shall continue to pay the cost of maintenance fuel
and insurance for the automobile through the lease term on the automobile lease
currently in place for the benefit of Employee. Thereafter, Employer shall
furnish Employee an automobile in accordance with Employer's benefit plan, if
any, for senior executives. Employee shall be provided a corporate credit card
in accordance with Employer's policy, if any.
6. Vacation. Employee shall be entitled to receive three (3)
weeks paid vacation time after each year of employment upon dates agreed upon by
Employer. Upon separation of employment, for any reason, vacation time accrued
and not used shall be paid at the salary rate of Employee in effect at the time
of employment separation.
7. Employee's Representations. Employee is free to enter into
this Employment Agreement and to perform each of the provisions contained
herein. Employee represents and warrants that Employee is not restricted or
prohibited, contractually or otherwise, from entering into and performing this
Employment Agreement, and that Employee's execution and performance of this
Employment Agreement is not a violation or breach of any agreement between
Employee and any other person or entity.
8. Nondisclosure of Confidential Information; Ownership of
Intellectual Property Rights; Non Competition; Covenant Not to Compete.
(a) Nondisclosure of Confidential Information.
During the term of this Employment Agreement and at all times thereafter,
Employee will keep confidential and will not directly or indirectly divulge to
anyone nor use or otherwise appropriate for Employee's own benefit, or on behalf
of any other person, firm, partnership or corporation by whom Employee might
subsequently be employed or otherwise associated or affiliated with, any
Confidential Information (as defined herein). For this purpose, "Confidential
Information" means any and all trade secrets or other confidential information
of any kind, nature or description concerning any matters affecting or relating
to the business of Employer or any affiliate of Employer which derives economic
value, actual or potential, from not being generally known to the public or the
trade or to other persons who can obtain economic value from its disclosure or
use and which is subject to efforts by Employer that are reasonable under the
circumstances to maintain its secrecy. Confidential Information does not include
information which (a) is or becomes generally available to the public or the
trade other than as a result of a disclosure by Employee or any of her agent or
representatives, or (b) was within Employee's possession prior to its being
furnished to Employee by Employer, ▇▇▇▇ ▇▇▇▇▇▇▇'▇ Brownstone Studio, Inc., or
▇▇▇▇▇▇, Inc.; provided that the source of such information in the case of either
clause (a) or (b) was not bound by a confidentiality agreement or other
contractual obligation of confidentiality with respect to such information or
did not otherwise acquire or disclose such information wrongfully.
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(b) Employer Intellectual Property Rights.
All intellectual property rights, whether or not patentable or copyrightable,
which (i) are made or developed with the equipment, supplies, facilities,
product formulations, trade secrets, time or other assets of Employer; (ii)
relate to the business, including anticipated research or development, of
Employer that are developed during the term of this Employment Agreement or
previously with ▇▇▇▇ ▇▇▇▇▇▇▇'▇ Brownstone Studio, Inc. or ▇▇▇▇▇▇, Inc., or (iii)
result from work performed by Employee for Employer, are and shall remain the
sole property of Employer, and upon request made by Employer, Employee shall
assign any and all rights, including copyrights, patents and patent rights,
trade ▇▇▇▇ and trade dress rights, Employee may have therein to Employer.
(c) Employer Materials. All reports and
analysis, designs, drawings, contracts, contractual arrangements,
specifications, computer software, computer hardware and other equipment,
computer printouts, computer disks, documents, memoranda, notebooks,
correspondence, files, lists and other records, and the like, and all
photocopies or other reproductions thereof, affecting or relating to the
business of Employer which Employee shall prepare, use, construct, observe,
possess or control ("Employee Materials"), shall be and remain the sole property
of Employer. Upon termination of this Employment Agreement, Employee shall
deliver promptly to Employer all such Employer Materials.
(d) Certain Restrictions on Business
Activities. During the term of this Employment Agreement, Employee agrees that:
(i) Business Activities. She will not,
directly or indirectly, own an interest in, operate, join, control or
participate in, or be connected as an officer, employee, agent, independent
contractor, partner, shareholder or principal of any corporation, partnership,
proprietorship, firm, association, person or other entity providing services
and/or products or a combination thereof which directly or indirectly compete
with Employer's business, and she will not undertake planning for or
organization of any business activity competitive with Employer's business or
combine or conspire with other employees or representatives of Employer's
business for the purpose of organizing any such competitive business activity,
except the purchase of less than four percent (4%) of the stock of a publicly
traded company which is not affiliated with Employer.
(ii) Solicitation of Customers, Etc. She
will not, directly or indirectly, either for herself or for any other person,
firm or corporation, divert or take away or attempt to divert or take away and,
if the Employee's termination of employment results for Cause (as defined
herein) or the Employee's voluntary termination of employment, for six (6)
months after the term of this Employment Agreement call on or solicit or attempt
to call on or solicit in an attempt to so divert or take away any of Employer's
customers or distributors, including but not limited to, those upon whom
Employee called or whom Employee solicited or serviced or with whom Employee
became acquainted while engaged as an employee in Employer's, ▇▇▇▇ ▇▇▇▇▇▇▇'▇
Brownstone Studio, Inc.'s, or ▇▇▇▇▇▇, Inc.'s business.
(iii) Solicitation of Employees, Etc.
She will not, directly or indirectly or by action in concert with others, induce
or influence (or seek to induce or influence) any person who is engaged (as an
employee, agent, independent contractor or otherwise) by Employer to terminate
his or her employment or engagement.
(e) Covenant Not to Compete.
(i) Obligations of Employee. Employee
acknowledges that, as a key management employee, Employee will be involved, on a
high level, in the development, implementation and management of the business
strategies and plans of Employer, which shall also consist of such other
business, units, divisions, subsidiaries or other entities of Employer as
Employer shall determine in its sole discretion from time to time (the
"Business"). By virtue of Employee's unique and sensitive position and special
background, employment
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of Employee by a competitor of Employer represents a serious competitive danger
to Employer and the Business, and the use of Employee's talent and knowledge and
information about Employer or the Business can and would constitute a valuable
competitive advantage over Employer and the Business. In view of the foregoing,
Employee covenants and agrees that, if Employee's employment with Employer is
terminated other than by Employer without Cause (as defined herein) at any time,
for a period of eighteen (18) months after the date of such termination,
Employee will not engage or be engaged, in any capacity, directly or indirectly,
including but not limited as employee, agent, consultant, manager, executive,
owner or stockholder (except as a passive investor holding less than a four
percent (4%) equity interest in any enterprise the securities of which are
publicly traded) in any business entity doing business in the United States
engaged in competition with any business conducted by Employer on the date of
termination. This Covenant Not to Compete shall survive the termination or
expiration of the other provisions of this Employment Agreement. If any court
determines that this Covenant Not to Compete, or any part thereof, is
unenforceable because of the duration or geographic scope of such provision,
such court shall have the power to reduce the duration or scope of such
provision, as the case may be, and, in its reduced form, such provision shall
then be enforceable.
(ii) Injunctive Relief. Employee
acknowledges that the violation of the covenants contained in this Section 8(e)
would be detrimental and cause irreparable injury to Employer and its affiliates
which could not be compensated by money damages. Employee agrees that an
injunction from a court of competent jurisdiction is the appropriate remedy for
these provisions, and consents to the entry of an appropriate judgment enjoining
Employee from violating these provisions in the event there is a finding of
their breach.
(f) Severability. Employee agrees, in the event
that any provision of this Section 8 or any word, phrase, clause, sentence or
other portion thereof shall be held to be unenforceable or invalid for any
reason, such provision or portion thereof shall be modified or deleted in such a
manner so as to make this Section 8 as modified legal and enforceable to the
fullest extent permitted under applicable laws. The validity and enforceability
of the remaining provisions or portions thereof shall not be affected thereby
and shall remain valid and enforceable to the fullest extent permitted under
applicable laws. A waiver of any breach of the provisions of this Section 8
shall not be construed as a waiver of any subsequent breach of the same or any
other provision.
10. Termination.
(a) Termination by Employer.
(i) Employer may terminate this
Agreement upon written notice for Cause. For purposes hereof, "Cause" shall mean
only (A) action wilfully taken with the intention of being to the material
detriment of Employer or Diplomat including engaging by the Employee in conduct
that constitutes activity in competition with Employer or Diplomat; (B) the
conviction of Employee for the commission of a felony; (C) the habitual abuse of
alcohol or controlled substances; and/or (D) material breach of this Agreement,
including, but not limited to, Employee's duties under Section 3 hereof.
Notwithstanding anything to the contrary in this Section 9(a)(i), Employer may
not terminate Employee's employment under this Agreement for Cause unless
Employee shall have first received notice from the Board advising Employee of
the specific acts or omissions alleged to constitute Cause, and such acts or
omissions continue after Employee shall have had a reasonable opportunity (at
least 20 days from the date Employee receives the notice from the Board) to
correct the acts or omissions so complained of.
(ii) In the event that during the term of
her employment with Employer, Employee shall become Disabled (as that term is
defined herein), Employer may terminate this Agreement and Employee's employment
hereunder at any time upon 10 days' written notice to Employee and Employee
shall be entitled to receive disability payments during the succeeding 12-month
period at a rate equal to one-half of the rate of the base salary as provided in
Section 4(a) to which she was theretofore entitled, payable in equal
installments no
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less frequently than monthly plus all employee benefits under Section 4(b). For
the purposes of this Agreement, Employee shall be deemed to have become Disabled
when by reason of his physical or mental incapacity, Employee shall not be able
to perform his duties hereunder for a period of six consecutive months or for an
aggregate of 180 days in any consecutive period of twelve months. Any proceeds
of disability insurance policies or plans maintained by Employer for the benefit
of Employee shall be paid to Employee up to an amount equal to the amount paid
under the first sentence of this Section 9(a)(ii).
(iii) This Employment Agreement and
Employer's obligations hereunder shall terminate upon Employee's death. Upon
termination for death, Employer shall continue to pay the compensation payments
pursuant to Section 4(a) to the surviving spouse of Employee (or if there is
none to Employee's estate) for the succeeding three (3) months.
(b) Termination by Employee. Employee shall
have the right to terminate her employment under this Agreement upon 20 days'
notice to Employer given within 90 days following the occurrence of any of the
following events:
(A) Employer acts to
materially reduce Employee's duties and responsibilities hereunder. Employee's
duties and responsibilities shall not be deemed materially reduced for purposes
hereof solely by virtue of the fact that Employer is (or substantially all of
its assets are) sold to, or is combined with, another entity, provided that
Employee shall continue to have the same duties and responsibilities with
respect to Employer's business, and Employee shall report directly to the
corporate designee of the entity (or individual) that acquires Employer or its
assets;
(B) Any reduction in Employee's rate
of base compensation, or a material reduction in Employee's other benefits;
(C) A failure by Employer to obtain
the assumption of this Agreement by any successor; or
(D) A material breach of this
Agreement by Employer, which is not cured within twenty (20) days of written
notice of such breach by Employer.
If Employer shall terminate Employee's employment other than due to her death or
disability or for Cause (as defined in Section 9(a)(i) of this Agreement), or if
Employee shall terminate this Agreement under Section 9(b), Employee shall
receive solely, as liquidated damages, all amounts provided for by Section 4 and
all additional employee benefits under Sections 4 and 5 throughout the remaining
term of this Agreement regardless of the amount of compensation she may earn
with respect to any other employment she may obtain. In the event of Employee's
death or disability, Employee shall be entitled to be reimbursed expenses under
Section 5 incurred prior to the date of death or disability.
10. [Reserved]
11. Excise Tax. In the event that any payment or benefit
received or to be received by Employee in connection with a termination of his
employment with Employer would constitute a "parachute payment" within the
meaning of Code Section 280G or any similar or successor provision to 280G
and/or would be subject to any excise tax imposed by Code Section 4999 or any
similar or successor provision then Employer shall assume all liability for the
payment of any such tax and Employer shall immediately reimburse Employee on a
"grossed-up" basis for any income taxes attributable to Employee by reason of
such Employer payment and reimbursements.
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12. Arbitration. Any controversies between Employer and
Employee involving the construction or application of any of the terms,
provisions or conditions of this Agreement, save and except for any breaches
arising out of Sections 8 hereof, shall on the written request of either party
served on the other be submitted to arbitration. Such arbitration shall comply
with and be governed by the rules of the American Arbitration Association. An
arbitration demand must be made within one (1) year of the date on which the
party demanding arbitration first had notice of the existence of the claim to be
arbitrated, or the right to arbitration along with such claim shall be
considered to have been waived. An arbitrator shall be selected according to the
procedures of the American Arbitration Association. The cost of arbitration
shall be born by the losing party or in such proportions as the arbitrator shall
decide. The arbitrator shall have no authority to add to, subtract from or
otherwise modify the provisions of this Agreement, or to award punitive damages
to either party.
13. Attorneys' Fees and Costs. If any action at law or in
equity is necessary to enforce or interpret the terms of this Agreement, the
prevailing party shall be entitled to reasonable attorney's fees, costs and
necessary disbursements in addition to any other relief to which he may be
entitled.
14. Entire Agreement. This Agreement contains the entire
agreement between the parties with respect to the transactions contemplated
herein and supersedes, effective as of the date hereof any prior agreement or
understanding between Employer and Employee with respect to Employee's
employment by Employer. The unenforceability of any provision of this Agreement
shall not affect the enforceability of any other provision. This Agreement may
not be amended except by an agreement in writing signed by the Employee and the
Employer, or any waiver, change, discharge or modification as sought. Waiver of
or failure to exercise any rights provided by this Agreement and in any respect
shall not be deemed a waiver of any further or future rights.
15. Assignment. This Agreement shall not be assigned to other
parties, provided, however, this Agreement may be assigned by Employer to an
entity that acquires substantially all of the assets of the Employer.
16. Governing Law. This Agreement and all the amendments
hereof, and waivers and consents with respect thereto shall be governed by the
internal laws of the State of New York.
17. Notices. All notices, responses, demands or other
communications under this Agreement shall be in writing and shall be deemed to
have been given when (a) delivered by hand; (b) sent by telefax, (with receipt
confirmed), provided that a copy is mailed by registered or certified mail,
return receipt requested, on such date; or (c) received by the addressee as sent
by express delivery service (receipt requested) in each case to the appropriate
addresses and telefax numbers as the party may designate to itself by notice to
the other parties:
(i) if to the Employer:
Diplomat Corporation
▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
Gersten, Savage, ▇▇▇▇▇▇▇▇▇
&Fredericks, LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
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Attention: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) if to the Employee:
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
& Kuh, LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
▇▇., Esq.
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
18. Severability of Agreement. Should any part of this
Agreement for any reason be declared invalid by a court of competent
jurisdiction, such decision shall not affect the validity of any remaining
portion, which remaining provisions shall remain in full force and effect as if
this Agreement had been executed with the invalid portion thereof eliminated,
and it is hereby declared the intention of the parties that they would have
executed the remaining portions of this Agreement without including any such
part, parts or portions which may, for any reason, be hereafter declared
invalid.
19. Guarantee. Diplomat guarantees the obligations of Employer
under this Agreement.
[Signatures on following page]
IN WITNESS WHEREOF, the undersigned have executed this
agreement as of the day and year first above written.
BROWNSTONE HOLDINGS, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, President
/S/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇
As to Section 19
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DIPLOMAT CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, President
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