EXHIBIT 10.21
CONSULTING, NONCOMPETITION
AND NONSOLICITATION AGREEMENT
CONSULTING, NONCOMPETITION and NONSOLICITATION AGREEMENT (this
"Agreement"), made and entered into as of October 25, 2000, by and between
Atrium Companies, Inc., a Delaware corporation ("Atrium"), and Xxxx Xxxxxxx, Jr.
(the "Consultant"). Capitalized terms used herein and not otherwise defined have
the meanings assigned to them in the Purchase Agreement (defined below).
WITNESSETH:
WHEREAS, Atrium is acquiring from The Xxxxxxx Company, Inc., a North
Carolina corporation ("Xxxxxxx Company"), substantially all of the operating
assets of the Xxxxxxx Windows and Doors Division ("EWD") and all of the
outstanding stock of VES, Inc., a Delaware corporation doing business as Xxxxxxx
Extrusion Systems ("EES"), pursuant to a Second Amended and Restated Purchase
Agreement, dated October 17, 2000 (the "Purchase Agreement"), by and among
Xxxxxxx Company, Atrium and D and W Holdings, Inc., a Delaware corporation
("Holdings"); and
WHEREAS, the Consultant has been the President and Chief Executive Officer
of Xxxxxxx Company and, therefore, has substantial knowledge and experience
relating to the business of EWD and EES; and
WHEREAS, the Consultant desires to aid and assist Atrium as a consultant by
providing certain advisory services to Atrium on a standby basis; and
WHEREAS, Atrium desires to engage the Consultant as a consultant to render
certain advisory services to Atrium on a standby basis; and
WHEREAS, as an inducement for Atrium to enter into the Purchase Agreement,
the Consultant has agreed to the noncompetition and nonsolicitation provisions
set forth in this Agreement; and
WHEREAS, Atrium and the Consultant desire to set forth herein their
understandings and agreements.
NOW, THEREFORE, in consideration of the foregoing, of the mutual promises
herein set forth, and of other good and valuable consideration the receipt and
sufficiency of which are hereby acknowledged, Atrium and the Consultant,
intending to be legally bound, hereby agree as follows:
1. ENGAGEMENT OF CONSULTANT. Atrium hereby engages the Consultant as
consultant and adviser to Atrium with respect to the matters specified in
Section 2 hereof for the compensation specified in Section 3 hereof, and the
Consultant hereby accepts the engagement.
2. ACTIVITIES OF CONSULTANT. Subject to his reasonable availability and the
other limitations set forth herein, during the period beginning on the date
hereof and continuing through October 15, 2007 (the "Term"), the Consultant will
undertake for and on behalf of, and to the extent specifically requested by,
Atrium, to advise Atrium by telephone or, at the Consultant's sole discretion,
in person with respect to (a) past matters or transactions of EWD and EES of
which he has actual knowledge and (b) strategies for expanding Atrium's customer
base and increasing its sales. The Consultant shall not be required to render
any written reports to Atrium with respect to the foregoing services unless, in
his sole discretion, the Consultant deems written reports to be necessary.
3. INDEPENDENT CONTRACTOR. The Consultant shall at all times be an
independent contractor and not an agent, employee or representative of Atrium.
Atrium hereby acknowledges and agrees that, except as otherwise agreed in
writing, the Consultant may engage, directly or indirectly, in other businesses
and ventures and shall not be required to perform any services under this
Agreement when, or for such periods in which, the rendering of services shall
unduly interfere with the Consultant's other businesses and ventures, provided
that any determination of undue interference shall be made by Consultant
reasonably and in good faith.
4. NONCOMPETITION AND NONSOLICITATION.
(a) ACKNOWLEDGMENTS. The Consultant acknowledges that (i) EWD has
been, and during the Term of this Agreement Atrium will be, engaged in the
business of making vinyl windows and doors ("EWD Products") for sale
throughout the United States; (ii) EES has been, and during the Term of this
Agreement Atrium will be, engaged in the business of vinyl lineal extrusion
(the "EES Products") for use in commerce throughout the United States; (iii)
the agreements and covenants contained in this Section 4 are essential to
protect the confidential information and goodwill associated with the EWD
Products and the EES Products being acquired by Atrium; and (iv) Atrium would
not enter into this Agreement or the Purchase Agreement but for the
agreements and covenants contained in this Section 4.
(b) COVENANT AGAINST COMPETITION. The Consultant covenants and agrees
that, during the Term of this Agreement, without the consent of Buyer, he
shall not, directly or indirectly, engage in any manner in the business of
making, assembling, selling, distributing or marketing EWD Products, EES
Products or any other windows or doors for sale in the United States, either
for his own account or in association with any other person, firm,
corporation, or entity in any capacity, including without limitation, as a
partner, shareholder, investor, member, principal, agent, lender or
consultant; provided, however, that this restriction shall not prevent the
Consultant from owning securities of Holdings or owning, directly or
indirectly, solely as an investment, securities of any entity traded on any
national securities exchange or market if he is not a controlling person of,
or a member of a group which controls, such entity and does not, directly or
indirectly, own 1% or more of any class of securities of such entity.
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(c) NONSOLICITATION. During the Term of this Agreement, the
Consultant shall not, within the United States or elsewhere (a) directly or
indirectly solicit or attempt in any manner to persuade or influence any
employees of Atrium, EWD or EES or any of their respective Affiliates to work
for any other person or (b) directly or indirectly solicit or attempt in any
manner to persuade or influence any present or future customer of Atrium, EWD
or EES or any of their respective Affiliates to divert its purchases of EWD
Products, EES Products or any other windows or doors from Atrium or its
Affiliates to any person then in competition with Atrium or its Affiliates or
to cease purchasing from Atrium, EWD or EES or any of their respective
Affiliates.
(d) RIGHTS AND REMEDIES UPON BREACH. If the Consultant breaches, or
threatens to breach, any of the provisions of this Section 4, in addition to
any other rights Atrium may have, including a claim for damages, Atrium shall
have the right to have this Section 4 specifically enforced by any court of
competent jurisdiction, it being agreed that any breach or threatened breach
of this Section 4 would cause irreparable harm to Atrium in that money
damages would not provide an adequate remedy to Atrium.
(e) FURTHER ASSURANCES.
(i) The Consultant acknowledges and agrees that the restrictions
contained in this Section 4 are reasonable and valid in geographical and
temporal scope and in all other respects. If any provision of this Section 4
or the application hereof to any party or circumstance shall be invalid or
unenforceable to any extent, the remainder of this Section 4 and the
application of such provision to other parties or circumstances shall not be
affected thereby and shall be enforced to the maximum extent permitted under
applicable law.
(ii) Without limiting the generality of the foregoing, if any court
of competent jurisdiction determines that any part of this Section 4 is
unenforceable because of the duration or geographic scope of such provision,
or both, the parties agree that such duration or scope shall be reduced to
the extent determined to be reasonable by such court of competent
jurisdiction and, in its reduced form, such provision shall then be valid,
binding and enforceable.
(iii) The Consultant and Atrium intend to and hereby confer
jurisdiction to enforce this Section 4 upon the courts of any jurisdiction
within the United States. If the courts of any one or more of such
jurisdictions hold that all or any part of this Section 4 is unenforceable
for any reason, it is the intention of the Consultant and Atrium that such
determination shall not bar or in any way affect Atrium's right to relief in
the courts of any other jurisdiction within the United States as to breaches
of this Section 4 in such other jurisdiction, the provisions of this Section
4 as they relate to each jurisdiction being, for this purpose, separate and
independent covenants.
5. COMPENSATION OF CONSULTANT. In consideration of the Consultant's
agreement to act as consultant and adviser to Atrium with respect to the
matters specified in Section 2 hereof, and the noncompetition and
nonsolicitation agreements set forth in Section 4 hereof, Atrium will make
payments to the Consultant in the aggregate amount of $2,100,000, payable in
168 equal installments of $12,500 each on the fifteenth and last days of each
month beginning October 31,
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2000 and continuing thereafter to and including October 15, 2007. In
addition to the payments provided for in this Section 5, the Consultant shall be
entitled to receive such payments to which he may be entitled from time to time
for his services as a member of Atrium's Board of Directors.
6. BINDING EFFECT. This Agreement shall inure to the benefit of and be
binding upon Atrium, the Consultant and their respective heirs, personal
representatives, successors and assigns.
7. NOTICES. Any notices, requests, demands or other communications in
connection with this Agreement shall be in writing and shall be deemed to have
been duly given if delivered personally or by a nationally recognized overnight
delivery service, as follows:
(a) If to Consultant:
Xxxx Xxxxxxx, Jr.
The Xxxxxxx Company, Inc.
Xxxxx 000
000 Xxxxx Xxxxxx Xxxx
Xxxxxxxxxx, XX 00000
(b) If to Atrium:
Atrium Companies, Inc.
0000 X. Xxxxxxxxxxx Xxxx, Xxxxx 0000X
Xxxxxx, Xxxxx 00000
Attention: Xxxx X. Xxxx
8. ENTIRE AGREEMENT. This Agreement contains the entire agreement with
respect to Atrium's engagement of the Consultant as consultant and adviser and
supersedes any prior agreements, understandings or negotiations (written or
oral) with respect thereto.
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IN WITNESS WHEREOF, this Agreement has been duly executed as of the day and
year first above written.
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Xxxx Xxxxxxx, Jr., Consultant
ATRIUM COMPANIES, INC.
By:
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Xxxx X. Xxxx, President
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