EXHIBIT 10.20
EMPLOYMENT AGREEMENT
Leslie's Poolmart, Inc.
Xxxxxxxx X. Xxxxxxx
This Employment Agreement ("Agreement") is made as of January 1, 2000 by
and between LESLIE'S POOLMART, INC., a Delaware corporation ("LPM"), and
XXXXXXXX X. XXXXXXX ("Xx. Xxxxxxx").
Recitals
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A. LPM is a corporation organized under the laws of Delaware. It is
engaged in the business of marketing pool supplies and related pool equipment
and products.
B. LPM desires to employ Xx. Xxxxxxx as President and Chief Executive
Officer of LPM to manage the business and affairs of LPM. Xx. Xxxxxxx desires
to be so employed and act in such capacities.
Accordingly, the parties agree as follows:
1. Employment. LPM will employ Xx. Xxxxxxx, and Xx. Xxxxxxx will be employed
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by LPM, as the President and Chief Executive Officer of LPM and will be
nominated as a member of its Board of Directors. Xx. Xxxxxxx shall assume these
positions on January 1, 2000. Xx. Xxxxxxx shall serve at the will of the Board
of Directors. Xx. Xxxxxxx shall be accorded the authority by the Board of
Directors commensurate with his position as Chief Executive Officer of LPM, and
he shall make a good faith effort to act in the best interests of LPM and
perform those duties reasonably assigned to him by the Board of Directors. Xx.
Xxxxxxx will devote himself full-time to the interests of LPM and shall not
accept other employment except with the consent of the Board of Directors of
LPM.
2. Location of Employment. Xx. Xxxxxxx'x principal place of employment shall
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be at the executive offices of LPM or at such other location as mutually agreed
upon by the parties.
3. Compensation.
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a. Salary. LPM shall pay Xx. Xxxxxxx a salary at the annual rate of
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$400,000.00, less normal withholdings, for each calendar year, prorated for any
portion thereof, payable in substantially equal installments in accordance with
LPM's usual payroll practice, but in no event less frequently than monthly.
b. Bonus. Xx. Xxxxxxx shall participate in the Bonus Plan for the most
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senior executives of LPM. Xx. Xxxxxxx shall be eligible for an annual bonus of
$150,000.00, depending upon the financial performance of LPM. Notwithstanding
the foregoing, Xx. Xxxxxxx shall be guaranteed a bonus for fiscal year 2000 of
not less than $150,000.00 irrespective of the financial performance of LPM
during that year or the termination of his employment during that year.
c. Stock Options. Effective this date, LPM hereby grants Xx. Xxxxxxx an
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irrevocable option to purchase up to 50,000 shares of LPM non-voting common
stock at the
purchase price of $20.00 per share. This option shall vest immediately. A more
detailed option agreement shall be separately executed by the parties hereto.
d. Other Benefits. Xx. Xxxxxxx shall receive other benefits such as four
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(4) weeks of vacation each year, personal and sick leave, insurance and other
benefits consistent with the then-current policies of LPM and equal to those
benefits extended to the most senior executives of LPM. Xx. Xxxxxxx will be
provided with office facilities, secretarial support, and business expense
reimbursement consistent with the policies of LPM with respect to its most
senior executives.
x. Xxxxxxxxx. If Xx. Xxxxxxx'x employment is terminated by LPM for any
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reason other than Just Cause, LPM shall continue to pay him an amount equal to
his then-current salary, less normal withholdings, at intervals equal to the
salary payments being received by the other most senior executives of LPM and
continue to provide Xx. Xxxxxxx with the benefits he received prior to
termination. Such payments and benefits shall continue through December 31, 2001
or the twelve-month period following termination, whichever is longer; provided,
however, that if Xx. Xxxxxxx becomes an employee, consultant, or partner of a
company or business entity, that directly competes with LPM, any severance
payments and benefits will end as of the date such relationship between Xx.
Xxxxxxx and the competing entity effectively commences. For the purpose of this
section, a termination for "Just Cause" shall mean a termination of employment
for any of the following reasons: (i) Xx. Xxxxxxx'x conviction of a felony,
without the right of further appeal, which has an adverse impact on the Company
or which involves the material misappropriation of LPM's assets; (ii) an
intentional or grossly negligent violation by Xx. Xxxxxxx of any reasonable
policy of the Board of Directors of LPM that results in material damage to the
Company and which, after notice to do so, Xx. Xxxxxxx fails to correct within a
reasonable time; or (iii) the performance of services by Xx. Xxxxxxx for any
other company, entity, or person which directly competes with LPM during the
time Xx. Xxxxxxx is employed by LPM, without the written approval of the Board
of Directors of LPM. In the event Xx. Xxxxxxx is required by LPM to relocate
from his existing home, such requirement shall at Xx. Xxxxxxx'x sole
determination be deemed a termination of his employment under this Section 3(e),
and Xx. Xxxxxxx shall be entitled to all of the severance set forth herein.
Further, in the event LPM or substantially all of its business or assets is
sold, consolidated, merged or there is a change in the control in the ownership
of LPM, such sale, consolidation, merger or change in control shall, at Xx.
Xxxxxxx'x sole determination, be deemed a termination of his employment under
this Section 3(e), and Xx. Xxxxxxx shall be entitled to all of the severance set
forth herein.
4. Reimbursement for Expenses. During the term of this Agreement, in addition
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to the reimbursement of those business expenses set forth in 3(d) above, LPM
shall reimburse Xx. Xxxxxxx for his travel, housing and living expenses as long
as Xx. Xxxxxxx is required to travel more than twenty-five (25) miles from his
home to his principal place of employment.
5. Representation of Xx. Xxxxxxx. Xx. Xxxxxxx represents and warrants that
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execution or delivery of this Agreement, or his performance hereunder will
conflict with, or result in a breach of, any obligation, contract, agreement,
covenant or instrument to which he is a party.
6. Dispute Resolution. This Agreement shall be governed and construed in
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accordance with the laws of the state of Xx. Xxxxxxx'x principal place of
employment. Xx. Xxxxxxx and LPM agree that any and all disputes, controversies
or claims of any nature between them including,
without limitation, any disputes arising out of or concerning this Agreement,
Xx. Xxxxxxx'x employment or his termination shall be determined exclusively by
final and binding arbitration before a single arbitrator located in the same
county as Xx. Xxxxxxx'x principal place of employment, administered by the
American Arbitration Association ("AAA") under the National Rules For Resolution
Of Employment Disputes of the AAA, and that judgment upon the award of the
arbitrator may be rendered in any court of competent jurisdiction. This includes
any claims Xx. Xxxxxxx may have against LPM or against LPM's officers,
directors, employees or agents in their capacity as such or otherwise. The
arbitrator shall be a former jurist or an attorney with substantial experience
in employment matters and mutually agreed to by the parties in their reasonable
discretion. This agreement to arbitrate does not include claims covered by
unemployment insurance and workers' compensation statutes.
The arbitrator's authority and jurisdiction shall be limited to determining the
dispute in arbitration in conformity with law to the same extent as if such
dispute were determined as to liability and remedy by a court without a jury.
The arbitrator shall render an award which shall include a written statement of
opinion setting forth the arbitrator's findings of fact and conclusions of law.
XX. XXXXXXX AND LPM EXPRESSLY WAIVE ALL RIGHTS TO A JURY TRIAL IN COURT ON ALL
STATUTORY OR OTHER CLAIMS.
7. Entire Agreement/Modifications. This Agreement constitutes the entire
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agreement of the parties with respect to Xx. Xxxxxxx'x employment with LPM. It
supersedes any prior agreement, statement or representation. It may be modified
only by written instrument executed by the party against which the modification
is asserted. Failure to require performance of any provision shall not affect
the right at a later time to enforce the same. No waiver by either party of a
breach, whether by conduct or otherwise, shall be construed as a further or
continuing waiver of any such breach.
8. Severability. Any provision of this Agreement that is prohibited or
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unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
9. Survivability. The rights and obligations of the parties to this Agreement
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under Sections 3.b., 3.e., 6, 7, 8 and 11 shall survive the termination of this
Agreement.
10. Assignability.
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a. Subject to the provisions of Section 3(e) above, in the event LPM shall
merge or consolidate with any other partnership, limited liability company,
corporation, or business entity or all or substantially all LPM's business or
assets shall be transferred in any manner to any other partnership, limited
liability company, corporation or business entity, such successor shall
thereupon succeed to, and be subject to, all rights, interests, duties,
obligations of, and shall thereafter be deemed for all purposes hereof to be,
LPM hereunder.
b. This Agreement is personal in nature and none of the parties hereto
shall, without the written consent of the other, assign or transfer this
Agreement or any rights or obligations hereunder, except by operation of law or
pursuant to the terms of Section 10(a) above.
c. Nothing expressed or implied herein is intended or shall be construed
to confer upon or give to any person, other than the parties hereto, any right,
remedy or claim under or by reason of this Agreement or of any term, covenant or
condition hereof.
11. Confidentiality and Non-Solicitation. The parties recognize that Mr.
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Hayward will have access to trade secrets and proprietary information of LPM,
and they recognize that should such information be revealed to a competitor, LPM
would be materially damaged in an amount difficult to calculate. During the
term of this Agreement and thereafter, Xx. Xxxxxxx promises not to disclose or
use or induce or assist in the disclosure or use any of the above information
except for the benefit of LPM. Accordingly, Xx. Xxxxxxx agrees that for one (1)
year after termination of his employment with LPM, regardless of the reason for
such termination, he shall not, directly or indirectly, on his behalf or the
behalf of any other person or entity, solicit any customers of LPM to cease to
do business or to reduce the amount of business with LPM or to do business with
another company that is a competitor of LPM or solicit any person who is an
employee of LPM to terminate such employment.
The parties hereto have executed this Agreement as of this 31st day of December,
1999.
LESLIE'S POOLMART, INC. XXXXXXXX X. XXXXXXX
By: Xxxxx X. XxXxxxxxx /s/ Xxxxxxxx X. Xxxxxxx
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Its: Chairman of the Board
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