EMPLOYMENT AGREEMENT
THIS
AGREEMENT is
entered into on Aug
14th ,
2006
(the “Execution
Date”),
by
and between PLY
GEM INDUSTRIES, INC.,
a
Delaware corporation (“Employer”)
and
XXXX
X. XXXXXXXXX
(“Employee”).
For
purposes of this Agreement, the “Companies”
shall
mean, collectively, Employer and any affiliates of Employer with whom Employee
is employed during the Term (as defined below).
WHEREAS,
the
Companies desire to employ Employee and to enter into an agreement embodying
the
terms of such employment and considers it essential to their best interests
and
the best interests of their stockholders to xxxxxx the employment of Employee
by
the Companies during the term of this Agreement;
WHEREAS,
Employee desires to accept such employment with and participation in the
ownership of the Companies and to enter into this Agreement;
WHEREAS,
Employee is willing to accept employment on the terms hereinafter set forth
in
this Agreement;
WHEREAS,
the
parties desire that Employee commence his employment with the Companies as
of a
date (the “Effective
Date”)
not
later than October 6, 2006, to be designated by Employee by advance written
notice to the Companies of at least ten (10) days; and
WHEREAS,
except
as specifically provided herein, this Agreement shall become effective, and
Employee’s employment with the Companies shall commence, as of the Effective
Date.
NOW
THEREFORE,
in
consideration of the premises and mutual covenants herein and for other good
and
valuable consideration, the parties agree as follows:
1. Employment.
The
Companies agree to employ Employee, and Employee accepts employment with the
Companies pursuant to the terms and conditions set forth in this Agreement.
Employee will devote his full business time, attention and best effort to the
performance of his duties and responsibilities as an Employee of the Companies
for the benefit of the Companies and will not engage in any other business,
profession or occupation for compensation or otherwise which would conflict
or
interfere with the rendition of such services either directly or indirectly,
without the prior written consent of the Board of Directors of Employer (the
“Board”).
Without limiting the foregoing, Employee may continue to serve as a member
of
the Boards of Directors of the organizations listed on Exhibit A and may serve
as a member of the Boards of Directors of such other organizations as approved
by the Board at its discretion, so long as Employee’s service on such Boards
does not conflict or interfere, either directly or indirectly, with the
rendition of his services to the Companies. Employee shall serve as President
and Chief Executive Officer of Employer and as a member of the Board and shall
have such duties and responsibilities as are consistent with the duties and
responsibilities of a President and Chief Executive Officer. Employee shall
also
serve as President and Chief Executive Officer and/or a member of the Board
of
Directors of any of the other Companies as the Board may determine from time
to
time.
2. Term
and Termination.
(a) Subject
to Section 2(b) below, the term of this Agreement will commence as of the
Effective Date and continue until the second anniversary of the Effective Date;
provided, however, that, commencing with such second anniversary date and on
each anniversary of such date thereafter (each an “Extension
Date”),
this
Agreement will automatically renew for an additional one (1) year term, unless
the Companies or Employee provides the other party hereto 60 days’ prior written
notice before the Extension Date that the term shall not be extended. The
initial two-year term of this Agreement (the “Initial
Term”)
and
any renewal thereof shall be referred to herein as the Term.
(b) This
Agreement and Employee’s employment hereunder may be terminated by the Companies
with or without “Cause” or by Employee whether or not following a “Material
Adverse Change” (as such terms are defined below). In the case of a termination
by the Companies without Cause or by Employee whether or not following a
Material Adverse Change, such termination shall be effective upon 60 days’
advance written notice to the other party. During the Term, if Employee’s
employment is terminated by the Companies without Cause or by Employee following
a Material Adverse Change, subject to Employee’s execution of a release of all
claims against the Companies in a form provided by the Companies, which shall
be
substantially in the form attached hereto as Exhibit B, and to his continued
compliance with the provisions of Sections 4, 5, 6 and 7 of this Agreement,
Employee shall be entitled to receive (i) continued payment of the “Salary” (as
defined below) for two years following the date of such termination (such
two-year period, the “Severance
Period”),
payable in accordance with the normal payroll practices of the Companies, (ii)
continuation of medical and dental benefits at the cost of the Companies,
pursuant to the same benefit plans as in effect for active employees of the
Companies, until the earlier to occur of the end of the Severance Period and
the
date on which Employee becomes eligible to receive comparable health benefits
from any subsequent employer; provided, that if continuation of such benefits
would be inconsistent with the terms of such benefit plans, the Companies will
reimburse Employee for amounts incurred in maintaining substantially similar
coverage under an individual policy in an amount not to exceed $20,000 per
year
and (iii) payment of the “Bonus” (as defined below) in respect of the fiscal
year of termination (the “Year
One Bonus”),
the
Bonus for the fiscal year following the year of termination (the “Year
Two Bonus”)
and a
pro-rated portion of the Bonus for the fiscal year ending two years after the
year of termination (the “Pro-Rated
Year Three Bonus”),
in
each case, based on actual achievement for the full year of termination. The
Year One Bonus will be an amount equal to the Bonus that Employee would have
received with respect to the fiscal year of termination had his employment
continued through the end of such year, and will be paid when the Bonus for
such
year would otherwise have been paid to Employee had his employment continued
through the end of such year. The Year Two Bonus will be an amount equal to
the
Year One Bonus, and will be paid when the Bonus for the fiscal year following
the year of termination would otherwise have been paid to Employee had his
employment continued through the end of such year. The
Pro-Rated
Year Three Bonus will be an amount equal to (x) the Year One Bonus multiplied
by
(y) a fraction, the denominator of which is 365 and the numerator of which
is
the number of days that Employee was employed by the Companies in the year
of
termination, and will be paid when the Bonus for the fiscal year ending two
years after the year of termination would otherwise have been paid to Employee
had his employment continued through the end of such year. The severance
payments and benefits described in (i) through (iii) of this paragraph shall
be
referred to herein, collectively, as the “Severance”.
Employee shall have no further rights to any compensation or any other benefits
under this Agreement or under any severance policy or program of the Companies.
In the event that either party elects not to extend the Term pursuant to Section
2(a) above, unless Employee’s employment is earlier terminated pursuant to this
Section 2(b), Employee’s termination of employment hereunder (whether or not
Employee continues as an employee of the Companies thereafter) shall be deemed
to occur upon expiration of the Term, and Employee shall not be entitled to
the
payments described in this Section 2(b). Employee may terminate his employment
with the Companies for any reason; provided, that Employee will be required
to
give the Companies at least 60 days’ advanced notice of such resignation. If
Employee’s employment by the Companies continues beyond the end of the Term
without extension pursuant to Section 2(a) above, Employee shall be an employee
at will and upon termination from such employment at will, he will be entitled
to severance only under the Companies’ plan or policy applicable to similarly
situated senior executives.
2
(c) For
purposes of the Agreement, “Cause”
shall
mean the following actions of Employee: (i) Employee’s willful and continued
failure to perform substantially his material duties (other than any such
failures resulting from, or contributed to by, incapacity due to physical or
mental illness), after a written demand for substantial performance is delivered
to him by the Board, which notice specifically identifies the manner in which
he
has not substantially performed his material duties, and his neglect to cure
such failure within 30 days; (ii) Employee’s willful failure to follow the
lawful direction of the Board; (iii) Employee’s material act of dishonesty or
breach of trust in connection with the performance of his duties to the
Companies; (iv) Employee’s conviction of, or plea of guilty or no contest to,
(x) any felony or (y) any misdemeanor having as its predicate element fraud,
dishonesty or misappropriation; or (v) a civil judgment in which any of the
Companies is awarded damages from Employee in respect of a claim of loss of
funds through fraud or misappropriation by Employee, any of which has become
final and is not subject to further appeal.
(d) For
purposes of this Agreement, “Material
Adverse Change”
shall
mean any of the following, without Employee’s express written consent: (i)
assignment to Employee of any duties that are inconsistent with his position,
duties and responsibilities and status with the Companies as President and
Chief
Executive Officer; (ii) reduction of the Salary or “Target Bonus” (as defined
below); or (iii) any action by the Companies that would reduce or deprive
Employee of any material employee benefit enjoyed by Employee, except where
such
change is applicable to all employees participating in such benefit plan;
provided, that a Material Adverse Change shall cease to exist for an event
on
the 60th day following the later of its occurrence or Employee’s actual
knowledge thereof, unless Employee has given the Companies written notice
thereof prior to such date.
(e) If
the
payment of the Severance pursuant to this Section 2 causes Employee to become
subject to the golden parachute excise tax rules of Internal Revenue Code
Section 4999, then the Companies will pay Employee a gross-up amount calculated
so that after all taxes are paid on the gross-up, Employee will have sufficient
funds remaining to pay the Section 4999 tax imposed on the Severance. This
gross-up will be calculated and administered by the Companies under procedures
developed by them with their auditors, and Employee agrees to cooperate as
reasonably requested by the Companies (including, without limitation, by
claiming any available tax refunds) with a view to achieving the purpose of
this
Section 2(e), which is to keep Employee whole with respect to the Severance
(that is, as if the parachute tax had not applied to the Severance) rather
than
to confer any additional compensatory benefit.
3
3. Salary
and Benefits.
(a) Salary.
During
the Term, Employee shall be entitled to an annual base salary, payable in
accordance with the normal payroll practices of the Companies (the “Salary”).
The
Salary shall be paid at the annual rate of $530,000 with respect to the period
commencing on the Effective Date and ending on the last day of fiscal year
2006.
With respect to any fiscal year during the Term following 2006, the Salary
shall
be determined by the Compensation Committee of the Board (the “Compensation
Committee”),
and
shall in no event be paid at an annual rate less than $530,000 per fiscal
year.
(b) Benefits.
During
the Term, Employee will have the right to participate in and receive benefits
under the Companies’ employee benefit plans (other than any severance plan) at
the same level as other senior executives of the Companies, subject to
compliance with each plan’s requirements for participation, including 401K,
medical insurance, life insurance, disability insurance, expense reimbursement,
car allowance and holidays. The benefits identified herein are not intended
to
be exclusive, but are not intended to include any severance plan.
(c) Vacation.
During
the Term, Employee shall be entitled to approximately four weeks of paid
vacation each fiscal year, with the exact amount of such vacation determined
at
Employee’s reasonable discretion.
(d) Temporary
Living and Relocation Expenses.
During
the period of time commencing on the Effective Date and ending on the date
that
Employee relocates his principal residence from Raleigh, North Carolina to
Employer’s headquarters in Kearney, Missouri or a subsequent headquarters of
Employer (the “Headquarters”),
the
Companies will reimburse Employee for reasonable expenses incurred in connection
with (i) locating and maintaining temporary housing and an automobile in the
Headquarters area and (ii) air travel between Raleigh and the Headquarters.
In
addition, if Employee relocates his principal residence from Raleigh to the
Headquarters area, the Companies will reimburse him for reasonable moving
expenses incurred in connection with such relocation.
(e) Bonus.
With
respect to each fiscal year during the Term, commencing with the 2006 fiscal
year, Employee will be entitled to receive a bonus (the “Bonus”)
upon
the achievement of the “Executive
Compensation Goals”,
which
shall be set by the Compensation Committee. The target Bonus (the “Target
Bonus”)
with
respect to any fiscal year during the Term will be an amount equal to 100%
of
the Salary; provided, that for fiscal year 2006, Employee will be guaranteed
a
minimum Bonus equal to the Target Bonus multiplied by a fraction, the
denominator of which is 365 and the numerator of which is the number of days
that Employee was employed by the Companies in such fiscal year. The Bonus
shall
be paid as soon as reasonably practicable following the end of the fiscal year
to which such Bonus relates, but in no event later than the date that is 2
½
months after the end of such fiscal year.
4
(f) Equity.
(i) Incentive
Stock.
Employee will have the right to purchase 110,000 shares of common stock of
Ply
Gem Prime Holdings, Inc. (the “Incentive
Stock”)
at the
fair market value price of $10 per share.
(ii) Strip
Equity.
Employee will also have the right to purchase shares of preferred stock and
additional shares of common stock of Ply Gem Prime Holdings, Inc. (the
“Strip
Equity”)
on the
same terms and conditions pursuant to which Xxxxxx-Xxxxxx Capital, Inc. acquired
its Strip Equity.
(iii) Stockholders’
and Subscription Agreements.
As a
condition precedent to the purchase and receipt of the Incentive Stock and/or
the Strip Equity, Employee agrees to execute and be bound by the Ply Gem Prime
Holdings, Inc. Stockholders’ Agreement, dated as of February 24, 2006 (the
“Stockholders’
Agreement”),
substantially in the form attached hereto as Exhibit C, and to enter into a
Subscription Agreement with Ply Gem Prime Holdings, Inc., substantially in
the
form attached hereto as Exhibit D.
(g) D&O
Insurance.
The
Companies shall at all times during Employee’s employment maintain directors’
and officers’ liability insurance coverage for the benefit of Employee and his
estate in an amount of at least Three Million Dollars $(3,000,000.00).
4. Developments.
All
discoveries, inventions, ideas, technology, formulas, designs, software,
programs, algorithms, products, systems, applications, processes, procedures,
methods and improvements and enhancements conceived, developed or otherwise
made
or created or produced by Employee, alone or with others, and in any way
relating to the business or any proposed business of the Companies of which
Employee has been made aware, or the products or services of the Companies
of
which Employee has been made aware, whether or not subject to patent, copyright
or other protection and whether or not reduced to tangible form, at any time
during Employee’s employment with the Companies (“Developments”),
shall
be the sole and exclusive property of the Companies. Employee agrees to, and
hereby does, assign to the Companies, without any further consideration, all
of
Employee’s right, title and interest throughout the world in and to all
Developments. Employee agrees that all such Developments that are copyrightable
may constitute works made for hire under the copyright laws of the United States
and, as such, acknowledges that the Companies are the authors of such
Developments and own all of the rights comprised in the copyright of such
Developments, and Employee hereby assigns to the Companies, without any further
consideration, all of the rights comprised in the copyright and other
proprietary rights Employee may have in any such Development to the extent
that
it might not be considered a work made for hire. Employee shall make and
maintain adequate and current written records of all Developments and shall
disclose all Developments promptly, fully and in writing to the Companies
promptly after development of the same, and at any time upon
request.
5
5. Confidentiality/
Property of the Companies. Employee
shall not, without the prior written consent of the Companies, use, divulge,
disclose or make accessible to any other person, firm, partnership, corporation
or other entity, any “Confidential Information” (as defined below) except while
employed by the Companies, in furtherance of the business of and for the benefit
of the Companies, or any “Personal Information” (as defined below); provided,
that Employee may disclose such information when required to do so by a court
of
competent jurisdiction, by any governmental agency having supervisory authority
over the business of any of the Companies or by any administrative body or
legislative body (including a committee thereof) with jurisdiction to order
Employee to divulge, disclose or make accessible such information; provided,
further, that in the event that Employee is ordered by a court or other
government agency to disclose any Confidential Information or Personal
Information, Employee shall (i) promptly notify the Companies of such order,
(ii) at the written request of the Companies, diligently contest such order
at
the sole expense of the Companies as expenses occur, and (iii) at the written
request of the Companies, seek to obtain, at the sole expense of the Companies,
such confidential treatment as may be available under applicable laws for any
information disclosed under such order. For purposes of this Section 5, (i)
“Confidential
Information”
shall
mean non public information concerning the financial data, strategic business
plans, product development (or other proprietary product data), customer lists,
marketing plans and other non public, proprietary and confidential information
relating to the business of the Companies or their customers, that, in any
case,
is not otherwise available to the public (other than by Employee’s breach of the
terms hereof) and (ii) “Personal
Information”
shall
mean any information concerning the personal, social or business activities
of
the shareholders, officers or directors of the Companies. Upon termination
of
Employee’s employment with the Companies, Employee shall return all property of
the Companies, including, without limitation, files, records, disks and any
media containing Confidential Information or Personal Information.
6. Non-Competition/Non-Solicitation.
Employee
acknowledges and recognizes the highly competitive nature of the businesses
of
the Companies and accordingly agrees as follows:
(i) During
the two-year period commencing on the date of Employee’s termination of
employment (the “Restricted
Period”),
or
such longer period as described in the last sentence of Section 9 of this
Agreement, Employee will not, directly or indirectly, (w) engage in any
“Competitive Business” (as defined below) for Employee’s own account, (x) enter
the employ of, or render any services to, any person engaged in any Competitive
Business, (y) acquire a financial interest in, or otherwise become actively
involved with, any person engaged in any Competitive Business, directly or
indirectly, as an individual, partner, shareholder, officer, director,
principal, agent, trustee or consultant, or (z) interfere with business
relationships between the Companies and customers or suppliers of, or
consultants to, the Companies.
(ii) For
purposes of this Section 6, a “Competitive
Business”
means
as of any date, including during the Restricted Period, any person or entity
(including any joint venture, partnership, firm, corporation or limited
liability company) that engages in or proposes to engage in the following
activities in any geographical area in which Employee works: (x) the manufacture
and sale of windows; vinyl and composite siding, fencing, decking and railing;
and entry and patio doors
and (y)
any new product lines and businesses entered into by the Companies during the
Term.
6
(iii) Notwithstanding
anything to the contrary in this Agreement, Employee may, directly or
indirectly, own, solely as an investment, securities of any person engaged
in
the business of the Companies which are publicly traded on a national or
regional stock exchange or on the over-the-counter market if Employee (A) is
not
a controlling person of, or a member of a group which controls, such person
and
(B) does not, directly or indirectly, own one percent (1%) or more of any class
of securities of such person.
(iv) During
the Restricted Period, Employee will not, directly or indirectly, without the
Companies’ written consent, solicit or encourage to cease to work with the
Companies any employee or any consultant of the Companies or any person who
was
an employee of or consultant then under contract with the Companies within
the
six-month period preceding such activity. In addition, during the Restricted
Period, Employee will not, without the Companies’ written consent, directly or
indirectly hire any person who is or who was, within the six-month period
preceding such activity, an employee of any of the Companies.
(v) Employee
understands that the provisions of this Section 6 may limit Employee’s ability
to earn a livelihood in a business similar to the business of the Companies,
but
Employee nevertheless agrees and hereby acknowledges that (A) such provisions
do
not impose a greater restraint than is necessary to protect the goodwill or
other business interests of the Companies, (B) such provisions contain
reasonable limitations as to time and scope of activity to be restrained, (C)
such provisions are not harmful to the general public and (D) such provisions
are not unduly burdensome to Employee. In consideration of the foregoing and
in
light of Employee’s education, skills and abilities, Employee agrees that he
shall not assert that, and it should not be considered that, any provisions
of
Section 6 otherwise are void, voidable or unenforceable or should be voided
or
held unenforceable.
(vi) It
is
expressly understood and agreed that, although Employee and the Companies
consider the restrictions contained in this Section 6 to be reasonable, if
a
judicial determination is made by a court of competent jurisdiction that the
time or territory or any other restriction contained in this Section 6 or
elsewhere in this Agreement is an unenforceable restriction against Employee,
the provisions of the Agreement shall not be rendered void but shall be deemed
amended to apply as to such maximum time and territory and to such maximum
extent as such court may judicially determine or indicate to be enforceable.
Alternatively, if any court of competent jurisdiction finds that any restriction
contained in this Agreement is unenforceable, and such restriction cannot be
amended so as to make it enforceable, such finding shall not affect the
enforceability of any of the other restrictions contained herein.
(vii) Employee
shall be required to comply with the requirements of this Section 6 during
the
Restricted Period only for so long as the Companies provide him with the
Severance.
(viii) The
provisions of this Section 6 shall not limit, or be limited by, the
Stockholders’ Agreement, including the non-competition and non-solicitation
provisions thereof.
7
7. Nondisparagement.
At any
time following termination of this Agreement and Employee’s employment
hereunder, (i) Employee agrees not to issue, circulate, publish or utter any
false or disparaging statements, remarks or rumors about the Companies or the
shareholders, officers, directors or managers of the Companies and (ii) the
Companies agree to instruct their executives, and the members of their
respective Boards of Directors, not to issue, circulate, publish or utter any
false or disparaging statements, remarks or rumors about Employee, in each
case,
other than to the extent reasonably necessary in order to (x) assert a bona
fide
claim against Employee or the Companies, as applicable, arising out of
Employee’s employment with the Companies or (y) respond in a truthful and
appropriate manner to any legal process or give truthful and appropriate
testimony in a legal or regulatory proceeding.
8. Policies
of the Companies.
Employee agrees to abide by the terms of any employment policies or codes of
conduct of the Companies that apply to Employee after termination of employment.
9. Enforcement.
Employee acknowledges and agrees that the Companies’ remedies at law for a
breach or threatened breach of any of the provisions of Sections 4, 5, 6 and
7
of this Agreement would be inadequate, and, in recognition of this fact,
Employee agrees that, in the event of such a breach or threatened breach, in
addition to any remedies at law, the Companies shall be entitled to obtain
equitable relief in the form of specific performance, temporary restraining
order, temporary or permanent injunction or any other equitable remedy which
may
then be available. In addition, the Companies shall, (a) upon the Board’s
determination that Employee has violated any provision of Section 4, 5, 6 or
7,
be entitled to immediately cease paying any amounts remaining due or providing
any benefits to Employee pursuant to Section 2 and (b) upon a final,
non-appealable judicial determination made by a court of competent jurisdiction
that Employee has violated any provision of Section 4, 5, 6 or 7 and subject
to
applicable state law, to reclaim any amounts already paid under Section 2.
If
Employee breaches any of the covenants contained in Section 4, 5, 6 or 7 of
this
Agreement, and the Companies obtain injunctive relief with respect thereto,
the
period during which Employee is required to comply with that particular covenant
shall be extended by the same period that Employee was in breach of such
covenant prior to the effective date of such injunctive relief.
10. Assignment
and Survival.
This
Agreement, and all of Employee’s rights and duties hereunder, shall not be
assignable or delegable by Employee. This Agreement may be assigned by the
Companies to any of their affiliates, provided that the Companies will remain
jointly and severally liable for all obligations hereunder. The obligations
under Sections 2(b), 4, 5, 6, 7, 8, 9 and 10 of this Agreement will survive
termination of this Agreement in accordance with their terms.
11. Severability.
If any
provision of this Agreement is held to be invalid or unenforceable, the
remainder of the provision and any other provisions of this Agreement will
remain in full force and effect.
8
12. Governing
Law.
THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE
STATE OF DELAWARE APPLICABLE TO AGREEMENTS MADE AND TO BE WHOLLY PERFORMED
WITHIN THAT STATE, WITHOUT REGARD TO ITS CONFLICT OF LAWS PROVISIONS OR THE
CONFLICT OF LAWS PROVISIONS OF ANY OTHER JURISDICTION WHICH WOULD CAUSE THE
APPLICATION OF ANY LAW OTHER THAN THAT OF THE STATE OF DELAWARE.
Each
party to this Agreement irrevocably agrees for the exclusive benefit of the
other that any and all suits, actions or proceedings relating to Section 4,
5,
6, 7 or 8 of this Agreement (collectively, “Proceedings”
and,
individually, a “Proceeding”)
shall
be maintained in either the courts of the State of Delaware or the federal
District Courts sitting in Wilmington, Delaware (collectively, the “Chosen
Courts”)
and
that the Chosen Courts shall have exclusive jurisdiction to hear and determine
or settle any such Proceeding and that any such Proceedings shall only be
brought in the Chosen Courts. Each party irrevocably waives any objection that
it may have now or hereafter to the laying of the venue of any Proceedings
in
the Chosen Courts and any claim that any Proceedings have been brought in an
inconvenient forum and further irrevocably agrees that a judgment in any
Proceeding brought in the Chosen Courts shall be conclusive and binding upon
it
and may be enforced in the courts of any other jurisdiction.
Each
of
the parties hereto agrees that this Agreement involves at least $100,000 and
that this Agreement has been entered into in express reliance on Section 2708
of
Title 6 of the Delaware Code. Each of the parties hereto irrevocably and
unconditionally agrees that (i) service of process may be made on such party
by
pre-paid certified mail with a validated proof of mailing receipt constituting
evidence of valid service sent to such party at the address set forth in this
Agreement, as such address may be changed from time to time pursuant hereto,
and
(ii) service made pursuant to clause (i) above shall, to the fullest extent
permitted by applicable law, have the same legal force and effect as if served
upon such party personally within the State of Delaware.
13. Counterparts.
This
Agreement may be executed in any number of counterparts, each of which will
be
deemed an original and all of which taken together will constitute but one
and
the same instrument.
14. Notice.
Any
notice intended to be given hereunder will be sufficiently given if sent by
national overnight carrier, shipping charges prepaid, addressed to the party
at
the address listed below or any subsequent address of which the parties have
been given written notice. Any such notice will be effective within three (3)
days of being deposited with the national overnight carrier.
If
to the
Companies:
Ply
Gem
Industries, Inc.
000
Xxxx
Xxxxx Xxxxxx
Xxxxxxx,
Xxxxxxxx 00000
Attention:
_______________
9
Xxxx,
Weiss, Rifkind, Xxxxxxx & Xxxxxxxx LLP
0000
Xxxxxx xx xxx Xxxxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000-0000
Attention:
Xxxx Xxxxxxx, Esq.
If
to
Employee:
0000
Xxxxxxxx Xxxxxx Xxxx, Xxxx 000
Xxxxxxx,
Xxxxx Xxxxxxxx 00000
15. Entire
Agreement/Amendment.
This
Agreement contains the entire agreement between the parties and supersedes
all
prior agreements and understandings (including verbal agreements) between
Employee and the Companies regarding the terms and conditions of Employee’s
employment with the Companies. This Agreement may not be amended or modified
except in writing, signed by both parties and will be binding upon the parties,
their heirs, successors, legal representatives and assigns.
16. Withholding
Taxes.
The
Companies may withhold from any amounts payable under this Agreement such
Federal, state and local taxes as may be required to be withheld pursuant to
any
applicable law or regulation.
17. No
Waiver.
The
failure of a party to insist upon strict adherence to any term of this Agreement
on any occasion shall not be considered a waiver of such party’s rights or
deprive such party of the right thereafter to insist upon strict adherence
to
that term or any other term of this Agreement.
18. Successor;
Binding Agreement.
This
Agreement shall inure to the benefit of and be binding upon personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees.
19. Employee
Representation.
Employee hereby represents to the Companies that the execution and delivery
of
this Agreement by Employee and the Companies and/or the performance by Employee
of Employee’s duties hereunder shall not constitute a breach of, or otherwise
contravene, the terms of any employment agreement or other agreement or policy
to which Employee is a party or otherwise bound, and such
execution, delivery and/or performance shall not result in any breach or
violation of, or a material default under, any law, order, judgment, decree,
rule or regulation applicable to him, or subject the Companies to any liability
in respect thereof.
20. No
Third Party Beneficiaries.
Subject
to Section 10 of this Agreement, nothing herein shall confer upon any person
not
a party to this Agreement any rights or remedies of any nature or kind
whatsoever, directly or indirectly, under or by reason of the
Agreement.
21. Expenses.
The
Companies agree to reimburse Employee for actual and reasonable legal expenses
incurred in relation to the negotiation and execution of this Agreement, his
employment and the other transactions contemplated hereby in an amount up to
$10,000.
10
22. Initial
Effectiveness.
This
Section 22 and the following provisions of this Agreement shall be effective
as
of the Execution Date: all Recitals to this Agreement; Section 3(f) (generally
relating to Employee’s opportunity to purchase equity in Ply Gem Prime Holdings,
Inc.); Section 19 (generally, Employee’s representation regarding the right to
enter into and perform in all respects this Agreement); and Sections 12 through
18 (generally relating to choice of law and various other matters). All other
provisions of this Agreement shall become effective as of the Effective
Date.
[Remainder
of Page Intentionally Left Blank]
11
IN
WITNESS WHEREOF,
the
parties have executed this Agreement as of the date first written
above.
XXXX
X. XXXXXXXXX
Name:
Date:
PLY
GEM INDUSTRIES, INC.
By:
Title:
Date:
Doc
#:NY7:198344.18
12
EXHIBIT
A
[List
of
company boards on which Employee serves.]
EXHIBIT
B
RELEASE
OF CLAIMS
I. Release.
In
consideration for the payments and benefits received by Employee (as defined
below) pursuant to that certain employment agreement dated _______ __, 2006
(the
“Employment
Agreement”),
by
and between Ply Gem Industries, Inc., a Delaware corporation (“Employer”)
and
Xxxx X. Xxxxxxxxx (“Employee”),
to
which Employee agrees Employee is not otherwise entitled, Employee, for and
on
behalf of himself and his heirs and assigns, subject to the following sentence
hereof, hereby waives and releases any common law, statutory or other
complaints, claims, charges or causes of action arising out of or relating
to
Employee’s employment or termination of employment with, his serving in any
capacity in respect of, or his status as a shareholder of, Employer and its
affiliates (collectively, the “Companies”),
both
known and unknown, in law or in equity, which Employee ever had, now has or
may
have against the Companies and their shareholders and any of their respective
subsidiaries, affiliates, predecessors, successors, assigns and any of their
respective directors, officers, partners, members, employees or agents
(collectively, the “Releasees”)
by
reason of facts or omissions which have occurred on or prior to the date that
Employee signs this Agreement, including, without limitation, any complaint,
charge or cause of action arising under federal, state or local laws pertaining
to employment, including the Age Discrimination in Employment Act of 1967
(“ADEA,”
a
law
which prohibits discrimination on the basis of age), the National Labor
Relations Act, the Civil Rights Act of 1991, the Americans With Disabilities
Act
of 1990, Title VII of the Civil Rights Act of 1964, all as amended; and all
other federal, state and local laws and regulations. By signing this release,
Employee acknowledges that he intends to waive and release any rights known
or
unknown he may have against the Releasees under these and any other laws;
provided, that Employee does not waive or release claims with respect to the
right to enforce the release, his right to receive severance payments on the
terms set forth in the Employment Agreement, his rights under Sections 3(e)
and
7 of the Employment Agreement, his rights under the Ply Gem Prime Holdings,
Inc.
Stockholders’ Agreement between Employee and Ply Gem Prime Holdings, Inc., a
Delaware corporation, dated as of February 24, 2006, or his right to
indemnification as an officer of the Companies as provided in the Companies’
by-laws and other constituent documents, as the same shall exist from time
to
time.
II. Proceedings.
Employee
acknowledges that he has not filed any complaint, charge, claim or proceeding,
against any of the Releasees before any local, state or federal agency, court
or
other body (each individually a “Proceeding”).
Employee represents that he is not aware of any basis on which such a Proceeding
could reasonably be instituted. Employee (i) acknowledges that he will not
initiate or cause to be initiated on his behalf any Proceeding and will not
participate in any Proceeding, in each case, except as required by law; and
(ii)
waives any right he may have to benefit in any manner from any relief (whether
monetary or otherwise) arising out of any Proceeding, including any Proceeding
conducted by the Equal Employment Opportunity Commission (“EEOC”).
Further, Employee understands that by signing the release, he will be limiting
the availability of certain remedies that he may have against the Companies
and
limiting also his ability to pursue certain claims against the Releasees.
Notwithstanding the above, nothing in Section I of this release shall prevent
Employee from (i) initiating or causing to be initiated on his behalf any
complaint, charge, claim or proceeding against the Companies before any local,
state or federal agency, court or other body challenging the validity of the
waiver of his claims under ADEA contained in Section I of the Agreement (but
no
other portion of such waiver); or (ii) initiating or participating in an
investigation or proceeding conducted by the EEOC.
III. Time
to Consider.
Employee
acknowledges that he has been advised that he has twenty-one (21) days from
the
date of receipt of this release to consider all the provisions of the release,
and he does hereby knowingly and voluntarily waive said given twenty-one (21)
day period. EMPLOYEE FURTHER ACKNOWLEDGES THAT HE HAS READ THIS AGREEMENT
CAREFULLY, HAS BEEN ADVISED BY THE COMPANIES TO, AND HAS IN FACT, CONSULTED
AN
ATTORNEY, AND FULLY UNDERSTANDS THAT BY SIGNING BELOW HE IS GIVING UP CERTAIN
RIGHTS WHICH HE MAY HAVE TO ASSERT A CLAIM AGAINST ANY OF THE RELEASEES, AS
DESCRIBED IN SECTION I OF THIS AGREEMENT AND THE OTHER PROVISIONS HEREOF.
EMPLOYEE ACKNOWLEDGES THAT HE HAS NOT BEEN FORCED OR PRESSURED IN ANY MANNER
WHATSOEVER TO SIGN THE AGREEMENT, AND EMPLOYEE AGREES TO ALL OF ITS TERMS
VOLUNTARILY.
IV. Revocation.
Employee
hereby acknowledges and understands that Employee shall have seven (7) days
from
the date of his execution of this release to revoke the releases contained
herein (including, without limitation, any and all claims arising under ADEA)
and that neither the Companies nor any other person is obligated to provide
any
benefits to Employee pursuant to the Employment Agreement until eight (8) days
have passed since Employee’s signing of this release without Employee’s
signature having been revoked. If Employee revokes the releases set forth in
this release, Employee will be deemed not to have accepted the terms of the
release, the release shall be void and no action will be required of the
Companies under any section of the release.
V. Non-Admission.
Nothing
contained in this release shall be deemed or construed as an admission of
wrongdoing or liability on the part of the Companies or Employee.
Date:___________
__________________________
Xxxx
X.
Xxxxxxxxx
EXHIBIT
C
[Stockholders’
Agreement]
EXHIBIT
D
[Subscription
Agreement]
