EXHIBIT 10.3
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "Agreement") is
entered into as of April 9, 2003 by and between Woodcraft Industries, Inc., a
Minnesota corporation (the "Company"), and Xxxx Xxxxxxxxxxx ("Executive").
A. Executive and the Company are parties to an Employment
Agreement dated July 10, 2000 (the "Original Agreement").
B. The Company and Executive desire to amend and restate the
Original Agreement in its entirety on the terms and conditions set forth in this
Agreement.
NOW, THEREFORE, in consideration of the foregoing premises and the
respective agreements of the Company and Executive set forth below, the Company
and Executive, intending to be legally bound, agree as follows:
1. EMPLOYMENT. Effective as of the date hereof, the Company shall
employ Executive, and Executive shall accept such employment and perform
services for the Company, upon the terms and conditions set forth in this
Agreement.
2. TERM OF EMPLOYMENT. Unless terminated at an earlier date in
accordance with Section 9 hereof, the term of Executive's employment with the
Company shall be for a period of two years commencing on the date hereof and
ending on the second anniversary of the date hereof. Thereafter, unless
terminated at an earlier date in accordance with Section 9 hereof, the term of
Executive's employment with the Company shall be automatically extended for
successive one-year periods, unless either party gives written notice to the
other party at least 60 days prior to the expiration of such term that such
party elects not to extend the term of this Agreement.
3. Position and Duties.
(a) EMPLOYMENT WITH THE COMPANY. During the term of Executive's
employment with the Company, Executive shall perform such duties and
responsibilities for the Company and any other subsidiary of the Company (the
"Subsidiaries") as the Board of Directors of the Company (the "Board") shall
assign to him from time to time consistent with his position. Executive shall be
an executive officer of the Company and Executive's title shall be President and
Chief Executive Officer.
(b) PERFORMANCE OF DUTIES AND RESPONSIBILITIES. Executive shall
serve the Company and the Subsidiaries faithfully and to the best of his ability
and shall devote his full working time, attention and efforts to the business of
the Company and the Subsidiaries during his employment with the Company.
Executive hereby represents and confirms that he is under no contractual or
legal commitments that would prevent him from fulfilling his duties and
responsibilities as set forth in this Agreement. During his employment with the
Company,
Executive may participate in charitable activities and personal investment
activities to a reasonable extent, and he may serve as a director of business
organizations in which he has personally invested, so long as such activities
and directorships do not interfere with the performance of his duties and
responsibilities hereunder.
4. COMPENSATION.
(a) BASE SALARY. While Executive is employed by the Company
hereunder, the Company shall pay to Executive an annual base salary of $280,000,
less deductions and withholdings, which base salary shall be paid in accordance
with the Company's normal payroll policies and procedures. As soon as
practicable after the end of each fiscal year, the Board shall conduct an annual
performance review of Executive and thereafter establish Executive's base salary
in an amount not less than the base salary in effect for the prior year.
(b) INCENTIVE COMPENSATION. While Executive is employed by the
Company hereunder, Executive shall be entitled to participate in the incentive
compensation plan attached hereto as Exhibit A.
(c) EMPLOYEE BENEFITS. While Executive is employed by the Company
hereunder, Executive shall be entitled to participate in all employee benefit
plans and programs of the Company to the extent that Executive meets the
eligibility requirements for each individual plan or program. The Company
provides no assurance as to the adoption or continuance of any particular
employee benefit plan or program, and Executive's participation in any such plan
or program shall be subject to the provisions, rules and regulations applicable
thereto.
(d) EXPENSES. While Executive is employed by the Company hereunder,
the Company shall reimburse Executive for all reasonable and necessary
out-of-pocket business, travel and entertainment expenses incurred by him in the
performance of his duties and responsibilities hereunder, subject to the
Company's normal policies and procedures for expense verification and
documentation.
(e) OPTIONS. As soon as practicable after the date hereof, the
Company shall make a stock option grant to the Executive under the WII Holdings,
Inc.'s 2003 Stock Option and Grant Plan.
5. CONFIDENTIAL INFORMATION. Except as permitted by the Board,
during the term of Executive's employment with the Company and at the all times
thereafter, Executive shall not divulge, furnish or make accessible to anyone or
use in any way other than in the ordinary course of the business of the Company
and the Subsidiaries, any confidential, proprietary or secret knowledge or
information of the Company or any of the Subsidiaries that Executive has
acquired or shall acquire during the term of his work for the Company or any of
the Subsidiaries as an employee, whether developed by himself or by others,
concerning (i) any trade secrets, (ii) any confidential, proprietary or secret
designs, processes, formulae, plans, devices or material (whether or not
patented or patentable) directly or indirectly useful in any aspect of the
business of the Company or any of the Subsidiaries, (iii) any customer or
supplier
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lists of the Company or any of the Subsidiaries, (iv) any confidential,
proprietary or secret development or research work of the Company or any of the
Subsidiaries, (v) any strategic or other business, marketing or sales plans of
the Company or any of the Subsidiaries, (vi) any financial data or plans
respecting the Company or any of the Subsidiaries, or (vii) any other
confidential or proprietary information or secret aspects of the business of the
Company or any of the Subsidiaries. Executive acknowledges that the
above-described knowledge and information constitutes a unique and valuable
asset of the Company and represents a substantial investment of time and expense
by the Company or one or more of the Subsidiaries, and that any disclosure or
other use of such knowledge or information other than for the sole benefit of
the Company or any of the Subsidiaries would be wrongful and would cause
irreparable harm to the Company. During the term of Executive's employment with
the Company, Executive shall refrain from any acts or omissions that would
reduce the value of such knowledge or information to the Company. The foregoing
obligations of confidentiality shall not apply to any knowledge or information
that (i) is now or subsequently becomes generally publicly known in the form in
which it was obtained from the Company or any of the Subsidiaries, (ii) is
independently made available to Executive in good faith by a third party who has
not violated a confidential relationship with the Company or any of the
Subsidiaries, or (iii) is required to be disclosed by legal process, other than
as a direct or indirect result of the breach of this Agreement by Executive.
6. VENTURES. If, during the term of Executive's employment with
the Company, Executive is engaged in or associated with the planning or
implementing of any project, program or venture involving the Company or any of
the Subsidiaries and a third party or parties, all rights in such project,
program or venture shall belong to the Company. Except as approved in writing by
the Board, Executive shall not be entitled to any interest in any such project,
program or venture or to any commission, finder's fee or other compensation in
connection therewith, other than the compensation to be paid to Executive by the
Company as provided herein. Executive shall have no interest, direct or
indirect, in any customer or supplier that conducts business with the Company or
any of the Subsidiaries, unless such interest has been disclosed in writing to
and approved by the Board before such customer or supplier seeks to do business
with the Company or any of the Subsidiaries; ownership by Executive, as a
passive investment, of less than 2.5% of the outstanding shares of capital stock
of any corporation listed on a national securities exchange or publicly traded
in the over-the-counter market shall not constitute a breach of this Section 6.
7. NONCOMPETITION COVENANT.
(a) AGREEMENT NOT TO COMPETE. During the term of Executive's
employment with the Company and for a period of 12 consecutive months from the
date of the termination of such employment, whether such termination is with or
without Cause (as defined below), or whether such termination is at the instance
of Executive or the Company, Executive shall not, directly or indirectly,
throughout North America, engage in any business that the Company or any of the
Subsidiaries has engaged in during the term of Executive's work for the Company
or any of the Subsidiaries as an employee, or any part of such business,
including without limitation the design, development, manufacture, distribution,
marketing, leasing or selling of wood cabinetry components or products, in any
manner or capacity, including without limitation as a proprietor, principal,
agent, partner, officer, director, stockholder, employee, member of any
association,
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consultant or otherwise. Ownership by Executive, as a passive investment, of
less than 2.5% of the outstanding shares of capital stock of any corporation
listed on a national securities exchange or publicly traded in the
over-the-counter market shall not constitute a breach of this Section 7(a).
(b) AGREEMENT NOT TO HIRE. During the term of Executive's
employment with the Company and for a period of 24 consecutive months from the
date of the termination of such employment, whether such termination is with or
without Cause (as defined below), or whether such termination is at the instance
of Executive or the Company, Executive shall not, directly or indirectly, hire,
engage or solicit any person who is then an employee of the Company or any of
the Subsidiaries or who was an employee of the Company or any of the
Subsidiaries at the time of Executive's termination of employment, in any manner
or capacity, including without limitation as a proprietor, principal, agent,
partner, officer, director, stockholder, employee, member of any association,
consultant or otherwise.
(c) AGREEMENT NOT TO SOLICIT. During the term of Executive's
employment with the Company and for a period of 24 consecutive months from the
date of the termination of such employment, whether such termination is with or
without Cause (as defined below), or whether such termination is at the instance
of Executive or the Company, Executive shall not, directly or indirectly,
solicit, request, advise or induce any then current or potential customer,
supplier or other business contact of the Company or any of the Subsidiaries to
cancel, curtail or otherwise change its relationship with the Company or any of
the Subsidiaries, in any manner or capacity, including without limitation as a
proprietor, principal, agent, partner, officer, director, stockholder, employee,
member of any association, consultant or otherwise.
(d) ACKNOWLEDGMENT. Executive hereby acknowledges that the
provisions of this Section 7 are reasonable and necessary to protect the
legitimate interests of the Company and that any violation of this Section 7 by
Executive shall cause substantial and irreparable harm to the Company to such an
extent that monetary damages alone would be an inadequate remedy therefor.
Therefore, in the event that Executive violates any provision of this Section 7,
the Company shall be entitled to an injunction, in addition to all the other
remedies it may have, restraining Executive from violating or continuing to
violate such provision.
(e) BLUE PENCIL DOCTRINE. If the duration of, the scope of or any
business activity covered by any provision of this Section 7 is in excess of
what is valid and enforceable under applicable law, such provision shall be
construed to cover only that duration, scope or activity that is valid and
enforceable. Executive hereby acknowledges that this Section 7 shall be given
the construction which renders its provisions valid and enforceable to the
maximum extent, not exceeding its express terms, possible under applicable law.
8. PATENTS, COPYRIGHTS AND RELATED MATTERS.
(a) DISCLOSURE AND ASSIGNMENT. Executive shall immediately disclose
to the Company any and all improvements and inventions that Executive may
conceive and/or reduce to practice individually or jointly or commonly with
others while he is employed with the Company with respect to (i) any methods,
processes or apparatus concerned with the development, use or
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production of any type of products, goods or services sold or used by the
Company or any of the Subsidiaries, and (ii) any type of products, goods or
services sold or used by the Company or any of the Subsidiaries. Executive also
shall immediately assign, transfer and set over to the Company his entire right,
title and interest in and to any and all of such inventions as are specified in
this Section 8(a), and in and to any and all applications for letters patent
that may be filed on such inventions, and in and to any and all letters patent
that may issue, or be issued, upon such applications. In connection therewith
and for no additional compensation therefor, but at no expense to Executive,
Executive shall sign any and all instruments deemed necessary by the Company or
any of the Subsidiaries for:
(i) the filing and prosecution of any applications for
letters patent of the United States or of any foreign
country that the Company may desire to file upon such
inventions as are specified in this Section 8(a);
(ii) the filing and prosecution of any divisional,
continuation, continuation-in-part or reissue
applications that the Company may desire to file upon
such applications for letters patent; and
(iii) the reviving, re-examining or renewing of any of such
applications for letters patent.
Minnesota Statutes Section 181.78 provides that the agreement of Executive
contained in this Section 8(a) does not apply, and written notification is
hereby given to Executive that this Section 8(a) shall not apply, to any
invention for which no equipment, supplies, facilities, confidential,
proprietary or secret knowledge or information, or other trade secret
information of the Company or any of the Subsidiaries was used and that was
developed entirely on Executive's own time, and (i) that does not relate (A)
directly to the business of the Company or any of the Subsidiaries, or (B) to
the actual or demonstrably anticipated research or development of the Company or
any of the Subsidiaries, or (ii) that does not result from any work performed by
Executive for the Company or any of the Subsidiaries.
(b) COPYRIGHTABLE MATERIAL. All right, title and interest in all
copyrightable material that Executive shall conceive or originate individually
or jointly or commonly with others, and that arise during the term of his
employment with the Company and out of the performance of his duties and
responsibilities under this Agreement, shall be the property of the Company and
are hereby assigned by Executive to the Company, along with ownership of any and
all copyrights in the copyrightable material. Upon request and without further
compensation therefor, but at no expense to Executive, Executive shall execute
any and all papers and perform all other acts necessary to assist the Company to
obtain and register copyrights on such materials in any and all countries. Where
applicable, works of authorship created by Executive for the Company or any of
the Subsidiaries in performing his duties and responsibilities hereunder shall
be considered "works made for hire," as defined in the U.S. Copyright Act.
(c) KNOW-HOW AND TRADE SECRETS. All know-how and trade secret
information conceived or originated by Executive that arises during the term of
his employment
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with the Company and out of the performance of his duties and responsibilities
hereunder or any related material or information shall be the property of the
Company, and all rights therein are hereby assigned by Executive to the Company.
9. TERMINATION OF EMPLOYMENT.
(a) The Executive's employment with the Company shall terminate
immediately upon:
(i) Executive's receipt of written notice from the Company
of the termination of his employment, other than notice
that the Company elects not to extend the term of this
Agreement;
(ii) the Company's receipt of Executive's written resignation
from the Company;
(iii) Executive's Disability (as defined below);
(iv) Executive's death; or
(v) the expiration of the term of Executive's employment
with the Company as specified in Section 2 hereof.
(b) The date upon which Executive's termination of employment with
the Company occurs shall be the "Termination Date."
10. PAYMENTS UPON TERMINATION OF EMPLOYMENT.
(a) If Executive's employment with the Company is terminated:
(i) by the Company (A) for any reason other than for Cause
(as defined below), or (B) by the delivery of a written
notice to Executive that the Company elects not to
extend the term of this Agreement, or
(ii) by Executive as a result of his resignation for Good
Reason (as defined below), or
(iii) by reason of Executive's Disability (as defined below),
the Company shall:
(x) pay to Executive as severance pay an amount equal to two
times his then current base salary;
(y) if Executive elects to continue his group health
insurance coverage with the Company following the
termination of his employment with the Company,
reimburse him for the full cost of the premiums
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he is required to pay to maintain such coverage at the
same level of coverage that was in effect as of the
Termination Date for a period of 24 consecutive months
after the Termination Date; and
(z) if Executive was employed by the Company hereunder for
six months or more of any fiscal year as of the
Termination Date, pay to Executive a pro rata portion
(based on the number of calendar days of employment
during that fiscal year) of any incentive compensation
that would have been payable to him for such fiscal year
pursuant to Section 4(b) hereof as if Executive had been
in the employ of the Company for the full fiscal year.
No incentive compensation shall be payable to Executive
with respect to any fiscal year in which Executive was
employed by the Company hereunder for less than six
months.
Any amount payable to Executive as severance pay or reimbursement for the cost
of the continuation of his group health insurance coverage hereunder shall be
subject to deductions and withholdings and shall be paid to Executive by the
Company in 24 approximately equal monthly installments commencing on the first
normal payroll date of the Company following the expiration of all applicable
rescission provided by law and continuing monthly thereafter. Any amount payable
to Executive as incentive compensation hereunder shall be paid to Executive by
the Company in the same manner and at the same time that incentive compensation
payments are made to current employees of the Company, but no earlier than the
first normal payroll date of the Company following the expiration of all
applicable rescission periods provided by law.
The Company shall be entitled to deduct from any severance pay otherwise payable
to Executive hereunder: (i) any amount earned as income by Executive after the
Termination Date as a result of self-employment or employment with any other
employer, and (ii) any amount received by Executive after the Termination Date
under any short-term or long-term disability insurance plan or program provided
to him by the Company. In addition, the Company shall be entitled to cease
making reimbursement payments to Executive for the cost of the continuation of
his group health insurance coverage with the Company after the Termination Date
if Executive becomes eligible for comparable group health insurance coverage
from any other employer. For purposes of reduction of the Company's financial
obligations to Executive under this Section 10(a), Executive shall promptly and
fully disclose to the Company in writing: (i) the nature and amount of any such
earned income from self-employment or employment with any other employer, (ii)
the amount of any such disability insurance payments, or (iii) the fact that he
has become eligible for comparable group health insurance coverage from any
other employer, and Executive shall be liable to repay any amounts to the
Company that should have been so mitigated or reduced but for Executive's
failure or unwillingness to make such disclosures.
(b) If Executive's employment with the Company is terminated by
reason of:
(i) Executive's abandonment of his employment or Executive's
resignation for any reason other than Good Reason,
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(ii) termination of Executive's employment by the Company for
Cause,
(iii) Executive's death, or
(iv) the expiration of the term of Executive's employment
with the Company as specified in Section 2 hereof on
account of delivery of a written notice to the Company
that Executive elects not to extend the term of this
Agreement,
the Company shall pay to Executive or his beneficiary or his estate, as the case
may be, his base salary through the Termination Date; provided, however, that in
the event of a termination by reason of Executive's death, if Executive was
employed by the Company hereunder for six months or more of any fiscal year as
of the Termination Date, pay to Executive a pro rata portion (based on the
number of calendar days of employment during that fiscal year) of any incentive
compensation that would have been payable to him for such fiscal year pursuant
to Section 4(b) hereof as if Executive had been in the employ of the Company for
the full fiscal year. No incentive compensation shall be payable to Executive
with respect to any fiscal year in which Executive was employed by the Company
hereunder for less than six months.
(c) "Cause" hereunder shall mean:
(i) an act or acts of dishonesty undertaken by Executive and
intended to result in substantial gain or personal
enrichment of Executive at the expense of the Company or
any of the Subsidiaries;
(ii) unlawful conduct or gross misconduct that is willful and
deliberate on Executive's part and that, in either
event, is materially injurious to the Company or any of
the Subsidiaries;
(iii) the conviction of Executive of a felony;
(iv) failure of Executive to perform his duties and
responsibilities hereunder or to satisfy his obligations
as an officer or employee of the Company, which failure
has not seen cured by Executive within 15 days after
written notice thereof to Executive from the Company; or
(v) material breach of any terms and conditions of this
Agreement by Executive not caused by the Company, which
breach has not been cured by Executive within ten days
after written notice thereof to Executive from the
Company.
(d) "Good Reason" hereunder shall mean:
(i) material breach of any terms and conditions of this
Agreement by the Company not caused by Executive, which
breach has not been
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cured by the Company within ten days after written
notice thereof to the Company from Executive; provided,
however that under no circumstances shall any reduction
or modification which is allowed under Section
10(d)(iii) be considered a material breach by the
Company of any of the terms and conditions of this
Agreement;
(ii) the relocation of Executive's office by more than 50
miles from the St. Cloud, Minnesota metropolitan areas
without Executive's prior written consent; or
(iii) a reduction of Executive's base salary or a material
modification to the incentive compensation plan attached
hereto as Exhibit A that decreases by a substantial
amount Executive's opportunity to earn incentive
compensation, unless such reduction is part of a general
reduction in the base salaries and/or incentive
compensation plans for all executive officers of the
Company.
(e) "Disability" hereunder shall mean the inability of Executive to
perform on a full-time basis the duties and responsibilities of his employment
with the Company by reason of his illness or other physical or mental impairment
or condition, if such inability continues for an uninterrupted period of 180
days or more during any 360-day period. A period of inability shall be
"uninterrupted" unless and until Executive returns to full-time work for a
continuous period of at least 30 days.
(f) In the event of termination of Executive's employment, the sole
obligation of the Company shall be its obligation to make the payments called
for by Sections 10(a) or 10(b) hereof, as the case may be, and the payment for
the value of any accrued, but unpaid vacation time and the Company shall have no
other obligation to Executive or to his beneficiary or his estate, except as
otherwise provided by law, under the terms of any other applicable agreement
between Executive and the Company or under the terms of any employee benefit
plans or programs then maintained by the Company in which Executive
participates.
(g) Notwithstanding the foregoing provisions of this Section 10,
the Company shall not be obligated to make any payments to Executive under
Section 10(a) hereof unless Executive shall have signed a release of claims in
favor of the Company in a form to be prescribed by the Board, all applicable
consideration periods and rescission periods provided by law shall have expired
and Executive is in strict compliance with the terms of Sections 5, 7(a), 7(b),
7(c), 8(a), and 8(b) hereof as of the dates of the payments.
11. RETURN OF RECORDS AND PROPERTY. Upon termination of his
employment with the Company, Executive shall promptly deliver to the Company any
and all records and any and all property of the Company or any of the
Subsidiaries in his possession or under his control, including without
limitation manuals, books, blank forms, documents, letters, memoranda, notes,
notebooks, reports, printouts, computer disks, computer tapes, source codes,
data, tables or calculations and all copies thereof, documents that in whole or
in part contain any trade secrets or confidential, proprietary or other secret
information of the Company or any of the Subsidiaries
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and all copies thereof, and keys, access cards, access codes, passwords, credit
cards, personal computers, telephones and other electronic equipment belonging
to the Company or any of the Subsidiaries.
12. LITIGATION AND REGULATORY COOPERATION. During and after the
Executive's employment, the Executive shall cooperate fully with the Company in
the defense or prosecution of any claims or actions now in existence or which
may be brought in the future against or on behalf of the Company which relate to
events or occurrences that transpired while the Executive was employed by the
Company. The Executive's full cooperation in connection with such claims or
actions shall include, but not be limited to, being available to meet with
counsel to prepare for discovery or trial and to act as a witness on behalf of
the Company at mutually convenient times. During and after the Executive's
employment, the Executive also shall cooperate fully with the Company in
connection with any investigation or review of any federal, state or local
regulatory authority as any such investigation or review relates to events or
occurrences that transpired while the Executive was employed by the Company. The
Company shall reimburse the Executive for any reasonable out-of-pocket expenses
incurred in connection with the Executive's performance of obligations pursuant
to this Section 12. If the Company seeks the Executive's cooperation pursuant to
this Section 12 more than three (3) years following his or her termination from
employment with the Company, the Company and the Executive shall mutually agree
upon a pier diem for time spent by the Executive fulfilling his or her
obligation under this subsection. No pier diem shall be payable to the
Executive, however, for any time spent providing testimony under oath.
Executive's cooperation with the Company shall be limited to reasonable amounts
of time which do not unreasonably hamper his abilities to be gainfully employed,
provided that such employment is not in breach of this Agreement.
13. REMEDIES.
(a) REMEDIES. Executive acknowledges that it would be difficult to
fully compensate the Company for monetary damages resulting from any breach by
him of the provisions of Sections 5, 7 and 8 hereof. Accordingly, in the event
of any actual or threatened breach of any such provisions, the Company shall, in
addition to any other remedies it may have, be entitled to injunctive and other
equitable relief to enforce such provisions, and such relief may be granted
without the necessity of proving actual monetary damages.
(b) ARBITRATION. Except for disputes arising under Sections 5, 7 or
8 hereof, all disputes involving the interpretation, construction, application
or alleged breach of this Agreement and all disputes relating to the termination
of Executive's employment with the Company shall be submitted to final and
binding arbitration in Minneapolis, Minnesota. The arbitrator shall be selected
and the arbitration shall be conducted pursuant to the then most recent
Employment Dispute Resolution Rules of the American Arbitration Association. The
decision of the arbitrator shall be final and binding, and any court of
competent jurisdiction may enter judgment upon the award. All fees and expenses
of the arbitrator shall be shared equally by Executive and the Company. The
arbitrator shall have jurisdiction and authority to interpret and apply the
provisions of this Agreement and relevant federal, state and local laws, rules
and regulations insofar as necessary to the determination of the dispute and to
remedy any breaches of the Agreement and/or violations of applicable laws, but
shall not have jurisdiction or authority
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to award punitive damages or alter in any way the provisions of this Agreement.
The arbitrator shall have the authority to award attorneys' fees and costs to
the prevailing party. The parties hereby agree that this arbitration provision
shall be in lieu of any requirement that either party exhaust such party's
administrative remedies under federal, state or local law.
14. MISCELLANEOUS.
(a) GOVERNING LAW. All matters relating to the interpretation,
construction, application, validity and enforcement of this Agreement shall be
governed by the laws of the State of Minnesota without giving effect to any
choice or conflict of law provision or rule, whether of the State of Minnesota
or any other jurisdiction, that would cause the application of laws of any
jurisdiction other than the State of Minnesota.
(b) AMENDMENT OF ORIGINAL AGREEMENT; ENTIRE AGREEMENT. The Company
and the Executive hereby agree that the Original Agreement is hereby amended and
restated in its entirety on the terms and conditions set forth herein. This
Agreement contains the entire agreement of the parties relating to the subject
matter of this Agreement and supersedes all prior agreements and understandings
with respect to such subject matter, and the parties hereto have made no
agreements, representations or warranties relating to the subject matter of this
Agreement that are not set forth herein.
(c) AMENDMENTS. No amendment or modification of this Agreement
shall be deemed effective unless made in writing and signed by the parties
hereto.
(d) NO WAIVER. No term or condition of this Agreement shall be
deemed to have been waived, except by a statement in writing signed by the party
against whom enforcement of the waiver is sought. Any written waiver shall not
be deemed a continuing waiver unless specifically stated, shall operate only as
to the specific term or condition waived and shall not constitute a waiver of
such term or condition for the future or as to any act other than that
specifically waived.
(e) ASSIGNMENT. This Agreement shall not be assignable, in whole or
in party, by either party without the written consent of the other party, except
that the Company may, without the consent of Executive, assign its rights and
obligations under this Agreement to any corporation or other business entity (i)
with which the Company may merge or consolidate, (ii) to which the Company may
sell or transfer all or substantially all of its assets or capital stock, or
(iii) of which 50% or more of the capital stock or the voting control is owned,
directly or indirectly, by the Company. After any such assignment by the
Company, the Company shall be discharged from all further liability hereunder
and such assignee shall thereafter be deemed to be the "Company" for purposes of
all terms and conditions of this Agreement, including this Section 14.
(f) COUNTERPARTS. This Agreement may be executed in any number of
counterparts, and such counterparts executed and delivered, each as an original,
shall constitute but one and the same instrument.
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(g) SEVERABILITY. Subject to Section 7(e) hereof, to the extent
that any portion of any provision of this Agreement shall be invalid or
unenforceable, it shall be considered deleted herefrom and the remainder of such
provision and of this Agreement shall be unaffected and shall continue in full
force and effect.
(h) CAPTIONS AND HEADINGS. The captions and paragraph headings used
in this Agreement are for convenience of reference only and shall not affect the
construction or interpretation of this Agreement or any of the provisions
hereof.
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IN WITNESS WHEREOF, Executive and the Company have executed this
Agreement as of the date set forth in the first paragraph.
WOODCRAFT INDUSTRIES, INC.
By: /s/ Xxxx Xxxxxxxxxxx
------------------------------
Name: Xxxx Xxxxxxxxxxx
Title: President
By: /s/ Xxxx Xxxxxxxxxxx
------------------------------
Name: Xxxx Xxxxxxxxxxx
EXHIBIT A
INCENTIVE COMPENSATION
For each fiscal year of the Company beginning after December 31, 2002,
Executive shall earn, as incentive compensation, a percentage of his base
salary, up to a maximum of 100%. The incentive compensation will be determined
on the basis of EBITDA of the Company. Incentive compensation shall be
determined as follows:
A. For each percentage point (rounded up or down to the nearest whole
number) that the Company's EBITDA is greater than 85% of the
Company's projected aggregate EBITDA, up to and including 100%,
Executive shall earn the product of 3.333% of his base salary not
to exceed 50%; and
B. For each percentage point (rounded up or down to the nearest whole
number) that the Company's EBITDA is greater than 100% of the
Company's projected aggregate EBITDA, up to and including 125%,
Executive shall earn 2.0% of his base salary not to exceed 50%.
All calculations that are required to determine the amount of Executive's
incentive compensation for a fiscal year shall be calculated as of December 31.
The Company shall pay Executive the amount of incentive compensation that he has
earned for a fiscal year, if any, within 75 days after the end of the year.
For purposes of determining Executive's incentive compensation, the terms
used in the Exhibit A have the following meanings:
"Base Salary" shall mean the total base salary paid to Executive in
accordance with Section 4.a of this Agreement during the applicable full fiscal
year.
"Projected Aggregate EBITDA" shall mean, for any year, the amount proposed
by management and approved by the Company's Board of Directors in the Company's
annual plan for a fiscal year as the Company's projected EBITDA.
