Exhibit 10.43
Employment Agreement
This Agreement is between AMF Bowling Products, Inc. (the "Company") and
Xxxx Xxxxxxxx ("Executive") and is effective March 15, 2001. The Company and
Executive agree as follows:
RECITAL
The Company is in the business of manufacturing, distributing and selling
bowling equipment. The Company has experienced difficulties in its operations in
recent years and its parent corporation, AMF Bowling Worldwide, Inc. ("WINC"),
has publicly announced that it is considering options to restructure the
outstanding debt of WINC and its subsidiaries (the "Restructuring"). Executive
has represented to the Company that he has knowledge and skills that are
critical to the success of the Company hand the Restructuring. Accordingly, the
Company desires to retain Executive as its chief operating officer and has
offered Executive the benefits in this Agreement in consideration of Executive's
promises herein. As used herein, the Company, together with WINC and its
subsidiaries, is referred to as "AMF".
1. Duties.
(a) Position. Executive will serve the Company as Chief Operating Officer
of the Company and a Senior Vice President of WINC. Executive will perform the
duties and responsibilities assigned to him by the President and Chief Executive
Officer of WINC (the "CEO"). The duties may include serving as a director or
officer of any affiliate of the Company. Executive will perform his duties
primarily at the Company's headquarters, wherever the CEO may from time to time
designate the headquarters to be (but in any case within a 30 mile radius of the
Company's current headquarters in Richmond, Virginia), and such other temporary
locations as the CEO may request.
(b) Executive's Obligations. Executive will devote his full attention and
time to the business and affairs of the Company and use his best efforts to
carry out his responsibilities with the highest degree of fidelity and
professionalism. Executive will abide by all guidelines and policies pertaining
to the business and affairs of the Company as may be approved from time to time
by the CEO (the "Guidelines"). Executive has read and understands the Guidelines
in effect as of this date.
(c) Employment at Will. Executive's employment is "at will". The Company
may terminate Executive's employment at any time with or without Cause (herein
defined). Executive may terminate his employment at any time with or without
cause.
(d) Personal Activity. Without violating his duties to the Company,
Executive may manage his personal investments, so long as his activities do not
compete with and are not provided to or for any entity that competes with AMF
and do not interfere with his responsibilities as an officer and executive of
AMF.
2. Compensation
(a) Base Salary. Executive's base compensation will be $240,000 annually
("Base Salary"). The Company will pay the Base Salary monthly or at such other
intervals, not less frequently than monthly, as it pays the base salaries of
other senior executives. The CEO may increase the Base Salary annually. The Base
Salary may not be decreased. Based salary will refer to the Base Salary as
increased.
(b) Annual Bonus.
(i) Executive will also be entitled to Incentive Compensation
("Bonus") under the Company's Incentive Compensation Plan ("the Plan") as
adopted by the CEO, in his sole discretion. Executive will be entitled to a
Bonus each year in an amount up to 50% of Base Salary. The Bonus will be based
on performance against ("Targets") set forth in the Annual Operating Plan
approved by the Board of Directors of the Company and WINC (the "Board").
(ii) With respect to the 2001 Plan, (a) eighty percent (80%) of the
Bonus will be based on the Company achieving an EBITDA Target for the Company of
$15.5 million (the "2001 EBITDA Target") and (b) twenty percent 20% will be
based on the Company reducing inventory by $5.2 million and accounts receivable
by $5.9 million, or a total of $11.1 million by any combination thereof (the
"2001 Working Capital Target"). For the 2001 EBITDA Target, Executive will be
eligible for twenty five percent (25%) of the portion of the Bonus allocable to
the EBITDA Target if the Company achieves ninety five percent (95%) of the
EBITDA Target. The balance will be earned as set forth in Exhibit B. For the
2001 Working Capital Target, Executive will be eligible for twenty five percent
(25%) of the portion of the Bonus allocable to the Working Capital Target, if
the Company achieves ninety five percent (95%) of the Working Capital Target.
The balance will be earned as set forth in Exhibit B.
(iii) The 2001 Plan provides that additional Bonus will be paid for
over achievement of the 2001 EBITDA Target and 2001 Working Capital Target. See
Exhibit B. The maximum amount of Bonus paid for over achievement will be twenty
five percent (25%) of Base Salary and will be achieved only if the Company
exceeds both the EBITDA Target and Working Capital Target by more than twenty
percent (20%). Plans for years after 2001 may or may not include a provision for
the payment of additional Bonus for exceeding Targets.
(c) Special Bonus.
(i) In addition to the Bonus, for 2001, 2002 and 2003 (the "Incentive
Period"), Executive will be eligible to earn a special bonus equal to five
percent (5%) of the EBITDA of the Company during the Incentive Period in excess
of $45 million (the "Special Bonus").
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(ii) The Special Bonus will be paid at the same time as the Bonus for
2003.
(d) Terms of Incentive Compensation. The Company and Executive agree that
the Bonus and Special Bonus are subject to the AMF Bowling Worldwide, Inc.
Incentive Compensation Policy, a copy of which is annexed hereto as Exhibit A
(the "Incentive Compensation Policy"). Unless otherwise defined herein, the
defined terms in the Incentive Compensation Policy have the same meaning in this
Agreement. For the purposes of this Agreement, (A) the fourth sentence of
Section 9 of the Incentive Compensation Policy is modified to provide that
EBITDA as used in a Plan will be as reported in the annual Form 10-K filed by
WINC with the Securities and Exchange Commission and (B) the last sentence of
Section 9 is modified to provide that Executive may appeal any decision of the
CEO in administering a Plan to the Board. In the event of a conflict between the
provisions of the Incentive Compensation Policy and the provisions of this
Agreement, the provisions of this Agreement will control.
(e) Severance. For the purpose of calculating EBITDA for the 2001 Plan and
the Special Bonus, severance expenses in 2001 for employees of the Company
terminated during 2001 will not be included in EBITDA for bonus calculation
purposes.
(f) EBITDA Targets. Executive acknowledges that the Plans for 2002 and
2003, including the EBITDA Targets therein, will be fixed by the CEO in
accordance with the Incentive Compensation Policy and that the sum of the EBITDA
Targets for 2001, 2002 and 2003 may exceed, in the CEO's sole discretion, $45
million. Subject to the Incentive Compensation Policy, the Bonus for years after
2001 will be based at least eighty percent (80%) on EBITDA with the balance
based on such other criteria as the CEO may, in his sole discretion, elect.
(g) Award Date. Except as specifically provided in this Agreement,
Executive will have no vested interest in a Bonus or the Special Bonus and
except as provided in Section 5(a), Executive will be entitled to the Bonus and
Special Bonus only if he is an employee in good standing on the Award Date.
3. Benefits.
(a) Vacation. Executive will be entitled to three (3) weeks annual vacation
during his employment. Vacation will be subject to the Guidelines.
(b) Other Benefits. Executive will be entitled to benefits, in accordance
with the Guidelines, applicable to senior executives generally.
(c) Retirement Plan. Highly compensated employees of AMF, such as
Executive, do not currently participate in the AMF's 401k retirement plan and
neither the Company not AMF presently offers a retirement, deferred compensation
or similar savings plan to those employees. The CEO intends, following the
Restructuring, to seek approval of the Board and the shareholders, if necessary,
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of an executive retirement and benefits program that the Company or AMF would
offer to highly compensated employees (the "Program"). The CEO has made no
decision concerning the terms, conditions or benefits that would be included in
the Program. The CEO also intends that the Program would provide special
benefits for senior executives. Executive acknowledges that he is not relying on
the CEO's current intention concerning the Program in accepting this position.
If the Company adopts the Program, the Company agrees that Executive will
participate in the Program and be entitled to those benefits offered executives
generally. Such participation will take into account Executive's additional
contributions, in the sole opinion of the CEO, to the overall success of WINC.
(d) Stock Options. Executive acknowledges that, for all practical purposes,
neither the Company nor AMF now offers a stock incentive plan to its executives
or other key employees. The CEO intends, following the Restructuring, to seek
approval of the Board and the shareholders, if necessary, of a new stock
incentive plan, which may include the award of stock options, to executives and
other key employees (the "Stock Incentive Plan"). The CEO has made no decision
concerning the terms, conditions or other provisions of the Stock Incentive
Plan. Executive acknowledges that he is not relying on the CEO's current
intention concerning the Stock Incentive Plan in accepting this position. If the
Company adopts the Stock Incentive Plan, the Company agrees that Executive will
partcipate in the Stock Incentive Plan and that such participation will take
into account Executive's additional contributions, in the sole opinion of the
CEO, to the overall success of WINC.
4. Termination of Employment
(a) Death or Disability. Executive's employment will terminate
automatically upon his death. The Company may terminate Executive's employment
because of Executive's disability. "Disability" means that the Executive has
been unable for a period of (i) 90 consecutive days or (ii) an aggregate of 180
days in a period of 365 consecutive days to perform fully his duties as a result
of physical or mental illness or injury. The Company may terminate Executive's
employment for Disability by written notice to Executive. The termination will
be effective on the 30th day after receipt of notice by Executive (the
"Disability Date"), unless Executive returns to full-time performance of his
duties before the Disability Date. In the event of a dispute as to whether
Executive has suffered a Disability, the final determination will be made by a
licensed physician selected by the CEO.
(b) Termination Date. "Termination Date" means the date of Executive's
death, the Disability Date or the date on which the termination of Executive's
employment by the Company or Executive is effective, as the case may be.
5. Company's Obligation Upon Termination.
(a) Termination Without Cause or with Good Reason. If Executive terminates
his employment for Good Reason (herein defined) or the Company terminates
Executive's
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employment (other than due to Executive's death or Disability or with Cause),
the Company will pay Executive:
(i) in one lump sum Executive's accrued but unpaid Base Salary (the
"Accrued Salary"), which will equal the sum of (1) any portion of Base Salary
through the Termination Date that has not yet been paid and (2) any accrued but
unpaid vacation pay under the Guidelines;
(ii) subject to Executive satisfying the condition precedent set forth
in Section 6, severance pay in the amount of his Base Salary on the Termination
Date payable, less applicable withholding and deductions, in twelve (12) equal
monthly installments beginning one month after the Termination Date
("Severance");
(iii) subject to Executive satisfying the condition precedent set
forth in Section 6, an "Allocable Bonus Amount" for the year in which
Executive's employment is terminated equal to the amount of the Bonus, if any,
to which Executive may have become entitled (if he was employed to the Award
Date) based on the Company's then current Plan for Executive multiplied by a
fraction, (x) the numerator of which is the number of days in year which
Executive was employed and (y) the denominator of which is 365. The Allocable
Bonus Amount will be calculated and paid only on the Award Date and subject to
the terms and conditions of the Plan (other than the requirement that Executive
be an employee on the Award Date), and
(iv) subject to Executive satisfying the condition precedent set forth
in Section 6, only if the Termination Date is during 2003, an "Allocable Special
Bonus Amount" equal to the amount of the Special Bonus, if any, to which
Executive may have been entitled (if he had been employed for the entire
Incentive Period and on the Award Date) multiplied by a fraction, (x) the
numerator of which is the number of days in Incentive Period for which Executive
was employed and (y) the denominator of which is 1,095. The Allocable Special
Bonus Amount will be calculated and paid only on the Award Date for the 2003
Bonus and subject to the terms and conditions of this Agreement (other than the
requirement that Executive be an employee on the Award Date).
AMF agrees to use its best efforts to secure its obligation to pay Severance by
a letter of credit in favor of Executive in the amount of $240,000. The letter
of credit will terminate upon the Consummation of the Restructuring. For the
purposes of this Agreement, the term "Consummation of the Restructuring" will
mean: (i) the date a Plan of Reorganization of, or involving, WINC, in
accordance with Title 11 of the U.S. Code ss. 101 et. seq., that has been
confirmed by an order of a court of competent jurisdiction, becomes effective in
accordance with its terms, or (ii) the effective date specified in any
restructuring agreement involving WINC that is not subject to judicial approval.
For purposes of this definition, "WINC" shall mean WINC and all of its direct
and indirect subsidiary corporations that file petitions for relief under the
U.S. Bankruptcy Code.
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(b) Good Reason. Good Reason means, without Executive's written consent:
(i) any material and permanent diminution in Executive's title, duties or
responsibilities inconsistent with his position as the chief operating officer
of the Company (other than as a a result of Executive's physical or mental
disability or other incapacity or refusal to perform such duties or
responsibilities); (ii) any reduction in Base Salary; (iii) the Company's
requiring Executive to be based permanently at any office or location other
than as provided in Section 1; or (iv) the Company's failure to comply with its
material obligations under this Agreement. Executive will provide the Company
with written notice of any of the events set forth in subsections (i) through
(iv) above and the Company will have 30 days to cure. Such notice will
specifically describe the reason or reasons that provide Executive with Good
Reason to terminate employment. Executive may not terminate employment for Good
Reason as a result of any reason specified in subsections (i) through (iv) if
the Company reasonably cures the reason or reasons within the thirty (30)-day
period following receipt of Executive's written notice.
(c) Termination Due to Death or Disability. Upon Executive's death during
his employment or if the Company terminates Executive's employment due to
Disability, the Company will pay Executive only his (i) Accrued Salary in one
lump sum and (ii) Allocable Bonus Amount, if any, at such time and under such
terms and conditions as may then be applicable. Executive will not be entitled
to Severance, any Bonus, an Allocable Bonus Amount, the Special Bonus or the
Allocable Special Bonus Amount (together, the "Enhanced Severance").
(d) Voluntary Resignation. If Executive resigns his employment for other
than Good Reason, the Company will pay Executive only his Accrued Salary in one
lump sum. Executive will not be entitled to the Enhanced Severance.
(e) Termination for Cause. The Company may terminate Executive's employment
at any time for cause if the CEO determines that Executive has (i) committed any
act of fraud or gross negligence in the course of his employment, which in the
case of gross negligence, has a material adverse effect on the business or
financial condition of the Company, (ii) willfully or deliberately failed to
perform the duties of his position, other than on account of his Disability,
(iii) intentionally refused to cause the Company to adhere to any material
provision of the operating budget or business plan adopted by the CEO or to any
lawful and material direction or instruction of the CEO, (iv) been convicted or
plead guilty (or nolo contendere) to any felony under the laws of the United
States or any state thereof or any foreign country to which Executive may be
subject, (v) engaged in gross misconduct, such as theft or embezzlement, or a
crime involving moral turpitude, which crime reflects poorly on the image or
reputation of the Company, (vi) made a material misrepresentation at any time to
the Company, or (vii) breached any of his obligations hereunder or failed to
comply with a reasonable and lawful instruction of the CEO, which continues for
a period of five (5) days after Executive's receipt of written notice from the
CEO identifying the objectionable action or infraction by Executive. If there is
a termination for cause, the Company will deliver to Executive a written notice
specifying the cause and the effective Termination Date. Upon termination for
cause, Executive will not be entitled to the Enhanced Severance.
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6. Executive's Obligation Upon Termination.
(a) Release. As a condition precedent to Executive's entitlement to receive
Severance, an Allocable Bonus Amount and/or an Allocable Special Bonus Amount,
Executive will release AMF and its officers, directors and Executives of and
from any "Claims" (as defined in such release). The release will be in the form
attached hereto as Exhibit "C". The release will not release the Company from
its obligations under this Agreement or AMF from any obligation under its
Charter or By Laws to indemnify Executive as an officer or director of the
Company.
(b) Confidentiality. During employment and following the Termination Date,
expect as required by law, Executive will not divulge any secret or confidential
information, knowledge or data relating to AMF that is not public knowledge
("Confidential Information").
(c) Disparaging Remarks. During employment and for a period of two (2)
years after the Termination Date, except as required by law, Executive will not
at any time make any disparaging, derogatory, negative or similar remarks,
comments or statements, in writing or otherwise, about or in any way in
reference to AMF, its products or services or its officers, directors,
employees or affiliates.
(d) Competition. During his and the one year period following any
termination of employment with the Company (the "Restricted Period"), Executive
will not directly or indirectly participate in or permit his name directly or
indirectly to be used by or become associated with (including as an advisor,
representative, agent, independent contractor, provider or personal services or
otherwise) any person, corporation, partnership, association or entity that is,
or intends to be, engaged in any business which is in competition with the
Business (herein defined) in any country in which AMF operates, competes or is
engaged in the Business or at such time intends so to operate, compete or
become engaged in such business ("Competitor").
(i) During the Restricted Period, Executive will not directly or
indirectly encourage (or solicit or assist any other person in firm in
encouraging or soliciting) any person, who was engaged in a business
relationship with AMF during the one year period preceding his termination of
employment with the Company, to engage in a business relationship with a
Competitor.
(ii) During the Restricted Period, Executive will not directly or
indirectly induce any employee to AMF to terminate his employment and will not
directly or indirectly either individually or as owner, agent, executive,
consultant or otherwise, employ, offer employment or cause employment to be
offered to any person (including employment as an independent contractor) who
is or was employed by AMF unless such person will have ceased to be so employed
for a period of at least twelve (12) months.
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(iii) Promptly following his termination of employment, Executive will
return to the Company all property of AMF in Executive's possession or under his
control, including all Confidential Information in whatever media it is
maintained.
(iv) The term "Business" means the business of owning or operating
bowling centers and/or manufacturing, distributing or selling bowling equipment,
products and accessories.
(v) Executive agrees that the Restricted Period and the covenants
and obligations of Executive with respect to non-competition, non-solicitation,
confidentiality, the property of AMF and the restricted territories (1) are
fair and reasonable and the result of negotiation and (2) relate to special,
unique and extraordinary matters and that a violation of any of their terms will
cause AMF irreparable injury for which adequate remedies are not available at
law. Therefore, Executive agrees that AMF will be entitled to an injunction,
restraining order or such other equitable relief as a court of competent
jurisdiction may deem necessary or appropriate to restrain Executive from
committing any violation of the covenants and obligations. These remedies are
cumulative and are in addition to any other rights and remedies the Company or
AMF may have at law or in equity. If at the time of enforcement, a court holds
that any restrictions are unreasonable under circumstances then existing, the
parties agree that the maximum period, scope, or geographical area legally
permissible under such circumstances will be substituted for the period, scope
or area stated herein.
7. No Personal Liability. No member of the Boards of Directors of officer
or executive of the Company or AMF shall be personally liable in the event the
Company is unable to make any payments under this Agreement due to a lack of
funding or financing, legal prohibition (including statutory or judicial
limitations) or failure to obtain any required consent.
8. Entire Agreement. This Agreement constitutes the entire understanding
and agreement of the parties hereto regarding the subject matter hereof. This
Agreement supersedes all prior negotiations, discussions, correspondence,
understandings and agreements relating to the subject matter of this Agreement.
9. Miscellaneous. This Agreement is personal to Executive and may not be
assigned by Executive otherwise than by will or the laws of descent and
distribution. The Agreement will be construed in accordance with the laws of the
Commonwealth of Virginia (without regard to the conflict of laws provisions of
any jurisdiction). The invalidity or unenforceability of any provision of this
Agreement will not affect the validity or enforceability of any other provision
of this Agreement. All amounts payable under this Agreement will be paid in
cash, subject to required income and payroll tax withholdings. All notices and
other communications will be in writing and will be given by hand delivery to
the other party or by registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:
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If to the Executive:
Xxxx Xxxxxxxx
00000 Xxxxxxx Xxx Xxxx
Xxxxxxxxxxxxxx, Xxxxxxxx 00000
If to the Company:
AMF Bowling Products, Inc.
0000 XXX Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxx
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date set forth above.
By: /s/Xxxx Xxxxxxxx
-----------------
Xxxx Xxxxxxxx
AMF Bowling Products, Inc.
By: /s/ XX Xxxxx
--------------
Xxxxxx Xxxxx
Title: President
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EXHIBIT "A"
XXXX XXXXXXXX
EMPLOYMENT AGREEMENT
AMF BOWLING WORLDWIDE, INC.
INCENTIVE COMPENSATION POLICY
These terms and conditions ("Terms") govern each incentive Compensation
Plan or Bonus Program ("Plan") offered by AMF Bowling Worldwide, Inc. or any of
its subsidiaries ("AMF" or the "Company"):
1. Summary. AMF may establish, amend, continue or terminate one or more
Plans to assist the Chief Executive Officer of AMF ("CEO") and senior
management in achieving the goals and objectives established by either the
Board of Directors of AMF Bowling Worldwide, Inc. ("Board") or the CEO. Each
Plan is established based on the Annual Operating Plan, business environment,
personnel, organization and structure in place at the time and is subject to
change, including termination, as necessary to serve the best interests of AMF.
The CEO has the sole discretion to make all decisions about a Plan. In his
discretion, the CEO may amend or terminate a Plan, limit the participation of
one or more participants, or deny, suspend or delay the award of Bonuses, for
any reason that the CEO deems to be in AMF's best interest. A Plan is intended
to offer to an employee of AMF Bowling Worldwide, Inc. or any subsidiary
("Employee"), who is eligible to participate in a Plan ("Participant"),
compensation ("Bonus") above the Participant's annual base salary.
2. Plan. The amount of a Bonus, its terms and conditions and the
eligibility requirements will be stated in a written summary of the Plan
("Summary") that will be delivered to each Participant. These Terms will be
incorporated automatically into each Summary. The Summary and these Terms will
constitute the Plan. The provisions of these Terms will control in the event of
a conflict between the Summary and these Terms.
3. Authority To Adopt Plans. A Plan will not be effective and legally
binding on AMF unless it is approved in writing by the CEO or, in the case of
an Employee whose annual Base Salary is less than US$70,000, by either AMF's
Vice President of Human Resources ("VPHR") or the president or manager of the
Primary Business Unit ("Unit Manager") in whose Primary Business Unit the
Employee serves. In the case of an Employee whose annual Base Salary is more
than US$70,000, a Plan will not be effective and binding on AMF unless it is
approved in writing by both the VPHR and the Unit Manager in whose the Primary
Business Unit the Employee serves. Unless changed by the CEO, the Primary
Business Units are Bowling Products, US Bowling Center Operations and
International Bowling Center Operations. No Plan will automatically continue
into the next year and must be approved in writing annually to be effective
and binding on AMF in a subsequent year. Except as provided in these Terms,
no officer or manager of AMF or any Business Unit has the authority to make any
commitment that obligates AMF to pay a Bonus on terms different than the Plan.
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4. Participants. Participation in a Plan is limited to those Employees who
are eligible to become "Participants" as stated in the Summary. In addition, to
participate in a Plan, a Participant must be an employee of AMF in good standing
and must be in the same position through the Award Date (defined below). The CEO
may remove the designation of "Participant" at any time, in his sole
discretion, by written notice sent to the Employee prior to the Award Date. If a
Participant is assigned to another position, he or she will automatically cease
being a "Participant", unless the CEO (or the VPHR or Unit Manager, subject to
the Base Salary limitations set forth in 3 above) informs the Employee in
writing prior to the Award Date that he or she will continue as a "Participant"
in the new position. An Employee, who was designated a "Participant" and who is
in a notice period with respect to a pending termination of employment for any
reason on the Award Date, will cease to be a "Participant" and will not be
entitled to a Bonus. An Employee, who was designated a "Participant" and who
dies or whose employment is terminated for any reason prior to the Award Date,
will cease to be a "Participant" and will not be entitled to a Bonus. Assuming a
Participant satisfies all other requirements, a Participant, who was disabled
for more than 30 days during the year (or applicable period for a Bonus), will
receive a prorated Bonus to reflect the length of disability.
5. Base Salary. Whenever base salary ("Base Salary") is used as a
measurement of a Bonus, Base Salary will exclude all benefits, such as housing
or automobile allowance, social charges, holiday pay and any other benefit or
forms of compensation. Base Salary will mean the Base Salary actually paid to
the Participant during the applicable period for which the Bonus will be paid. A
Bonus will not be part of the Base Salary or other compensation for the purpose
of calculating any other benefit or entitlement under an employment contract or
law.
6. No Contract. No Plan will create a contract of employment (or an
employment offer) or a contract to pay a Bonus between AMF and a Participant.
The Plan will not become a provision of or amend any written contract (or
implied contract under the law of any jurisdiction) between an Employee and AMF.
Each Plan will be governed and construed by the laws of the Commonwealth of
Virginia. Each Participant agrees that the United States District Court for the
Eastern District of Virginia or the Circuit Court of the County of Hanover,
Virginia will have exclusive jurisdiction to resolve any dispute between AMF and
a Participant involving a Plan or Bonus. To the extent a Plan may be affected or
altered in any manner by the law of any jurisdiction or any written or implied
contract between AMF and the Employee, the Plan (and the participation of the
Employee in the Plan) will not become effective and the Plan will be void as to
the Employee.
7. Award Date. Unless otherwise provided in a Plan, Bonuses will be paid to
Participants on the Award Date, which will be a date, designated by the CEO,
within 30 days of the completion of the annual audit of the Company ("Audit").
In the past, Bonuses have been paid on or before March 31.
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8. Measurements. A Plan may use any number of measurements, such as
"Net Revenue", "Revenue" or "EBITDA", to determine the amount of a Bonus. Each
Participant agrees that monthly and other periodic financial and management
reports that reflect measurements are tentative and will not be final until
the Audit. While AMF will strive to produce accurate periodic reports upon
which Bonuses may be anticipated during a year, each Employee should anticipate
that there may be adjustments that could affect the Bonus as part of the Audit.
All amounts paid towards or on account of Bonuses prior to the Audit wil be
advances and subject to adjustment based on the Audit. Once the Audit is
complete and the CEO exercises his discretion regarding the award of Bonuses,
the issue is closed and final.
9. EBITDA. EBITDA is a typical measurement for Bonuses. In summary, EBITDA
means the consolidated earnings of AMF before net interest expense, income
taxes, depreciation and amortization, other income and expenses, as determined
by the CEO, following the Board's approval of the Audit. The definition of
EBITDA may be altered by the CEO, in his discretion, to reflect changes in
accounting rules, the objectives of the Board and any requirements in bank or
credit agreements. The CEO may adjust, by increase or decrease, any EBITDA or
other measurement prior to the Award Date for any reason that the CEO deems to
be, in his sole discretion, in the best interest of the Company. The CEO may
make adjustments to take into account acquisitions, divestitures and revenue
producing capital expenditures that were not specially included in writing as
part and a condition of the Annual Operating Plan approved for the Primary
Business Unit. In the event of an adjustment of EBITDA or any other measurement,
the CEO may adjust, as he deems appropriate in his sole discretion, any
applicable measurement thresholds.
10. Amendment or Termination. Each Plan is a guideline that the CEO may use
to determine and award Bonuses in a manner that he deems, in his sole
discretion, to be in the best interest of the Company. No Plan can explain its
full details or implementation. In his discretion, the CEO may amend or
terminate a Plan, limit the participation of one or more Participants, for any
reason that the CEO deems to be in the best interest of AMF. The basis of the
CEO's decision may be any thing, event or circumstance that the CEO deems to
require the action in the best interest of AMF. The thing, event or circumstance
may include, but is not limited to, any matter that, in the sole discretion of
the CEO, may affect the Company's or any Primary Business Unit's performance
or warrant a change in the Company's or any Primary Business Unit's the Annual
Operation Plan, cash reserves or capital structure, personnel, organization or
structure. There is no commitment to fairness under a Plan other than to serve
the best interest of AMF as determined by the CEO. There is no appeal of any
decision of the CEO in administering the Plan. There is no requirement of
advance notice or explanation of any reason for the decision of the CEO so long
as the CEO's decision is communicated orally or in writing prior to the Award
Date.
11. Right of Offset. At its election, AMF nay offset against a Bonus any
claims or debts due by the Participant to AMF.
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12. Confidentiality. Each Participant acknowledges that the communication
of the existence and terms of a Plan may impact employees who are not included
in a Plan. Each Participant agrees to keep the terms and existence of a Plan
confidential and not to disclose the Plan or its terms.
13. Compliance with AMF's Policies. Through the Award Date, each
Participant will comply with the Company's policies and guidelines and will
exhibit enthusiasm, leadership and fidelity to the Company, its goals and its
employees.
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EXHIBIT "B"
XXXX XXXXXXXX
EMPLOYMENT AGREEMENT
2001 BONUS PLAN
Percent of Target Achieved Percent of Target Bonus Earned
Under 95.0% 0%
95.0%-95.9% 25%
96.0%-96.9% 40%
97.0%-97.9% 55%
98.0%-98.9% 70%
99.0%-99.9% 85%
100% 100%
Provisions:
. The COO is eligible to earn a full 2001 Bonus if employed by March 15, 2001.
If the COO begins his employment after such date, the 2001 Bonus will be
pro rated for the period of 2001 during which the COO was an employee.
. The 2001 Bonus is subject to the AMF Incentive Compensation Policy.
. The COO is eligible for an Over Achievement Bonus only if Products achieves
100% of both the EBITDA and the Working Capital Targets.
. The Over Achievement Bonus will be in an amount up to a maximum of 25% of
Base Salary and will be measured solely on EBITDA in excess of the EBITDA
Target as follows:
Percent of EBITDA Target Percent of Base Salary
100% to 105% 5% of Base Salary
105% to 110% 10% of Base Salary
110% to 115% 15% of Base Salary
115% to 120% 25% of Base Salary
EXHIBIT "C"
XXXX XXXXXXXX
EMPLOYMENT AGREEMENT
RELEASE OF ALL CLAIMS
This Release of All Claims (the "Release") is entered into by Xxxx
Xxxxxxxx ("Employee") and AMF Bowling Products, Inc. ("AMF"), effective as of
date set forth on the signature page hereto.
In consideration of the payments required to be made to Employee pursuant
to a certain the Employment Agreement effective March __, 2001 between Employee
and AMF (the "Agreement") in the event of termination of his employment with
AMF under specific circumstances described in the Agreement, Employee and AMF
agree as follows:
1. Release and Waiver of Claims.
(a) Employee, on behalf of himself or herself and his or her family, heirs,
executors, administrators, legal representatives and assigns (collectively
referred to in this Release as "Employee"), hereby unconditionally and forever
releases, discharges and waives any and all claims of any nature whatsoever,
whether legal, equitable or otherwise, which employee may have against AMF and
its affiliates (collectively, the "the Companies") and their employees,
officers, directors, stockholders, representatives and agents, and any person
or entity which may succeed to the rights and liabilities of any such entities
or persons by assignment or otherwise (collectively referred to in this Release
as the "Companies"), arising as a result of events occurring at any time on or
before the date of termination of Employee's employment with the Companies (the
"Termination Date"), other than claims made with respect to any payments due to
Employee pursuant to the Agreement. This Release is a release of all claims of
any nature whatsoever by Employee against the Companies, other than with
respect to any payments due to Employee pursuant to the Agreement or any other
severance plan or policy in which the Employee participates, and includes,
other than as herein provided, any and all claims, causes of action,
obligations, damages, losses or liabilities, whether known or unknown, both at
law and in equity, including those caused by arising from or related to
Employee's employment relationship with the Companies, or separation or
severance from employment, including, without limitation, any and all alleged
discrimination or acts of discrimination which occurred or may have occurred
on or before the Termination Date based upon race, color, sex, creed, national
origin, age, disability or any other violation of any Equal Opportunity Law,
ordinance, rule, regulation or order, including, but no limited to, Title VII of
the Civil Rights Act of 1964, as amended; the Civil Rights Act of 1991; the Age
Discrimination in Employment Act, as amended (as further described in Section 2
below); the Americans with Disabilities Act; claims under the Employee
Retirement Income Security Act of 1974, as
amended ("ERISA"); the Family and Medical Leave Act of 1933 ("FMLA"); state
workers' compensation laws; or any other federal, state or local or regulations
regarding employment discrimination, employment or termination of employment.
This includes claims for wrongful discharge, fraud, or misrepresentation under
any statute, rule, regulation or under the common law.
Employee understands and knowingly agrees to this Release because it is his
or her intent in executing this Release to forever discharge the Companies from
any and all causes of action, foreseen or unforeseen, that may have existed on
or prior to the Termination Date, except for any payments due to Employee
pursuant to the Agreement.
(b) Notwithstanding anything in this Release to the contrary, Employee will
retain the right, after the Termination Date, to be indemnified from liability
to the extent required by the Companies' Charter and By-Laws and applicable law
for authorized actions taken in good faith as an employee, officer and/or
director, of the Companies, as the case may be. Notwithstanding the foregoing,
Employee does not release, discharge or waive any rights to receive any wages
due and owing, any benefits in accordance with the provisions of any Company
employee benefit plan in which Employee participates, reimbursement for
Company-related business expenses incurred by Employee on or prior to the
Termination Date and any conversion rights under a Company-sponsored group
term life insurance plan in which Employee participates.
2. Release and Waiver of Claims Under the Age Discrimination in Employment
Act.
Employee acknowledges that the Companies have encouraged him to consult
with an attorney of his choosing, and through this Release encourages him to
consult with his attorney with respect to possible claims under the Age
Discrimination in Employment Act of 1967, as amended ("ADEA"), as well as under
the other federal, state and local laws within the scope of Section 1 above, and
that Employee acknowledged that he understands that the ADEA is a federal
statute that prohibits discrimination on the basis of age, in employment,
benefits, and benefit plans. Employee wishes to waive any and all claims under
the ADEA, as well as under all other federal, state and local laws within the
scope of Section 1 above, that he may have, as of the Termination Date, against
the Companies and hereby waives such claims. Employee further understands that
by signing this Release he is in fact waiving, releasing and forever giving up
any claim under the ADEA, as well as all other federal, state and local laws
within the scope of Section 1 above, that may have existed on or prior to the
Termination Date. Employee acknowledges that the consideration provided to him
under the Agreement is in addition to anything of value to which Employee is
already entitled. Employee acknowledges that the Companies have informed him
that he has at his option, twenty-one (21) days in which to sign this Release,
and that by execution hereof he hereby knowingly and voluntarily waives said
twenty-one (21) day period. Employee also understands that he has seven (7) days
following the date on which he executes this Release within which to revoke it
by providing a written notice of
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his revocation of the Release to the Companies at _______________________;
Attention:______________________.
3. Proceedings.
Employee has not filed, and agrees not to initiate or cause to be initiated
on his behalf, any complaint, charge, claim or processing against the Companies
before any local, state or federal agency, court or other body relating to his
employment or the termination of his employment, other than with respect to the
obligations of the Companies to Employee under the Agreement (each individually,
a "Proceeding"), and agrees not to voluntarily participate in any Proceeding.
Employee waives any right he may have to benefit in any manner from any relief
(whether monetary or otherwise) arising out of any Proceeding.
4. Remedies.
In the event Employee Initiates or voluntarily participates in any
Proceeding (other than any Proceeding in which Employee seeks indemnity from
liability to the extent provided in the Companies' Charter and By-Laws and
applicable law for authorized actions taken in good faith as an employee,
officer and/or director of the Companies), or if he fails to abide by any of the
terms of this Release, the Companies may, in addition to any other remedies
they may have, reclaim any amounts paid to him under the Employment Agreement
or terminate any payments that are subsequently due under the Agreement, without
waiving the Release granted herein. Employee acknowledges and agrees that the
remedy at law available to the Companies for breach of any of his obligations
under this Release would be inadequate and that damages flowing from such a
breach may not readily be susceptible to being measured in monetary terms.
Accordingly, Employee acknowledges, consents and agrees that, in addition to
any other rights or remedies which the Companies may have at law, in equity or
under this Release, upon adequate proof of his or her violation of any such
provision of this Release, the Companies will be entitled to immediate
injunctive relief and may obtain a temporary order restraining any threatened
or further breach, without the necessity of proof of actual damage.
Employee understands that by entering into this Release he will be limiting
the availability of certain remedies that he may have against the Companies and
limiting also his or her ability to pursue certain claims against the Companies.
5. Severability Clause.
In the event any provision or part of this Release is found to be invalid
or unenforceable, only that particular provision of part so found, and not the
entire Release, will be inoperative.
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6. Non-Admission.
Nothing contained in this Release will be deemed or construed as an
admission of wrongdoing or liability on the part of the Companies.
7. Governing Law.
This Release shall be governed by and construed in accordance with federal
law and the laws of the state in which Employee was principally employed by the
Companies as of the Termination Date applicable to releases made and to be
performed in that state.
8. Acknowledgement.
Employee expressly acknowledges, represents and warrants that he has read
this release carefully; that he fully understands the terms, conditions and
significance of this release; that the companies have advised and urged him to
consult with his attorney concerning this release; that he has been represented
by counsel and has had a full opportunity to review this release with his
attorney and has done so; that he has had ample opportunity to negotiate through
his attorney; and that he has executed this release voluntarily, knowingly and
with such advice from his attorney as he has deemed appropriate.
IN WITNESS WHEREOF, the parties have executed this RELEASE as of the date
set forth above.
EMPLOYEE
________________________________________
Name: Xxxx Xxxxxxxx
AMF BOWLING PRODUCTS, INC.
By: _________________________________
Name: _________________________________
Title: _________________________________
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