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EXHIBIT 10.6
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EKCO GROUP, INC.
00 Xxxx Xxxxx Xxxx
Xxxxxx, XX 00000
Xxxxxxxx 0, 0000
Xx. Xxxxxxx X. Xxxxxxx
00 Xxxxxx Xxxx
Xxxxxxxxx, XX 00000
Re: Employment Agreement
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Dear Mal:
This letter is to confirm our understanding with respect to (i) your future
employment by Ekco Group, Inc. (the "Company"), (ii) your agreement to protect
and preserve information and property which is confidential and proprietary to
the Company, and (iii) your agreement not to compete with the Company (the terms
and conditions agreed to in this letter shall hereinafter be referred to as the
"Agreement"). In consideration of the mutual promises and covenants contained in
this Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby mutually acknowledged, we have agreed as
follows:
1. EMPLOYMENT. The Company will employ you, and you agree to be employed by
the Company, as the Company's Chief Executive Officer and Chairman of the Board
and you agree to perform such services and discharge such duties and
responsibilities, consistent with that office, as may be prescribed by the Board
of Directors of the Company from time to time. You shall devote your full time
and best efforts in the performance of the foregoing services, provided,
however, that you shall not be prevented or limited from continuing to serve as
a member of the Board of Directors or Board of Trustees of those corporations or
entities which you currently serve and such other positions as to which the
Board of Directors may consent, from time to time, which consent will not be
unreasonably withheld.
2. Term of Employment.
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(a) TERM; TERMINATION. Your employment hereunder shall commence on December
4, 1996 and shall continue thereafter on an "at-will" basis until terminated
either by you or by the Company for any reason upon written notice to the other.
The right of the Company to terminate your employment hereunder, to which you
hereby agree, shall be exercisable by written notice sent to you by the Company
and shall be effective as of the date of such notice.
3. Compensation.
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(a) SALARY AND BONUS. The Company shall pay you as compensation for your
services and agreements hereunder during the term hereof (i) salary at the rate
of $250,000 per year,
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payable in accordance with the Company's salary payment policy for executive
employees generally, less any amounts required to be withheld under applicable
law, and (ii) a bonus in such amount, if any, as may be determined annually by
the Board of Directors or the Compensation Committee in its sole discretion.
(b) TERMINATION. Upon termination of your employment hereunder, no further
compensation or benefits of any kind shall be payable to you hereunder, except
as provided in Section 5(c) and 5(d) below; provided, however, that you shall
continue to be bound by the terms and conditions of this Agreement (other than
Section 1 hereof).
4. Stock Option.
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The Company shall, upon the date of your acceptance of this Agreement,
grant to you a stock option to purchase an aggregate of 900,000 shares of the
common stock, $.01 par value, of the Company, with an exercise price per share
equal to the fair market value of the Common Stock on the date of grant and
subject to the terms and conditions set forth in the Nonqualified Stock Option
Agreement (the "Option Agreement") attached hereto as EXHIBIT A.
5. Benefits and Reimbursement of Expenses.
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(a) VACATION. You shall be entitled to four weeks of vacation leave for
each 12 months of service performed by you at a time or times (either
consecutively or not consecutively) mutually agreeable to the Company and you.
The Company will not pay you any additional compensation for any vacation time
which is not used.
(b) EMPLOYEE BENEFIT PLANS. You shall also be entitled to participate in
such employee benefit plans and fringe benefits which the Company provides or
may establish for the benefit of its executive employees generally (including,
without limitation, group life, medical, dental and other insurance plans), but
only if and to the extent provided in such employee benefit plans.
(c) REIMBURSEMENT OF EXPENSES. You shall be entitled to reimbursement for
all ordinary and reasonable out-of-pocket business expenses (including first
class air travel and hotel accommodations) which are reasonably incurred by you
in furtherance of the Company's business in accordance with reasonable policies
adopted from time to time by the Company.
(d) EXCISE TAX. In the event you become subject to tax under Section 4999
of the Internal Revenue Code (the "IRC"), or any similar tax ("Excise Tax"), as
a result of any payment (within the meaning of Section 280G of the IRC or other
applicable provision) by the Company or any affiliate of the Company, the
Company agrees that it will then "gross up" your compensation by making an
additional payment to you in an amount which, after reduction for any income or
excise taxes payable as a result of receiving such additional payment, is equal
to the Excise Tax.
6. Confidentiality, Inventions, and Non-Competition Acknowledgements and
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Agreements.
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(a) Your agreements set forth in this Section 6 shall survive the
expiration or termination of this Agreement and the termination of
your employment with the Company for any reason.
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(b) You acknowledge that irreparable injury would be caused to the Company
by your breach of any of the provisions of this Section 6, and agree
that in the event of any such breach, the Company and any of its
affiliates, in addition to such other rights and remedies as may exist
in its favor, may apply to any court of law or equity having
jurisdiction to enforce the specific performance of the provisions of
this Section 6 and may apply for injunctive relief against any act
which would violate any such provisions.
(c) You recognize that you now have knowledge of and/or may hereafter gain
knowledge of, confidential information, trade secrets, confidential
processes, confidential patentable or unpatentable inventions or
confidential "know how", including, without limitation, techniques,
formulae, designs, developments, projects, technical information and
manufacturing process and distribution methods, relating to, or
concerned with the business of the Company and its affiliates prior to
the termination of this Agreement and their respective suppliers,
customers, stockholders, licensors, licensees, and other persons or
entities with which the Company or its affiliates has, has had, or may
in the future have any commercial, scientific or technical
relationship. During the term of this Agreement and at all times
following the termination of your employment for any reason, you will
not, directly or indirectly, divulge, furnish or make accessible to
anyone (other than as required in the regular course of your
employment by the Company or with the consent of the Board of
Directors) such information. The prohibitions contained in this
Section 6(c) shall not apply to information which is (a) within the
domain of the general public; (b) generally known within the industry
or industries in which the Company or its affiliates is involved; or
(c) independently developed by you without utilization of confidential
information gained while in the employ of the Company; provided that
you shall not have disclosed such information in violation of this
Agreement. All documents, records, apparatus, equipment and other
physical property furnished to you by the Company or any affiliates of
the Company or produced by you or others in connection with your
services to the Company or any such affiliate shall be and remain the
sole property of the Company. You will return and deliver such
property to the Company as and when requested by the Company. Copies
of documents and records may be kept, but shall be kept completely
confidential to the same extent as other confidential information of
the Company. You shall return and deliver all such property upon
termination of your employment for any reason, and you will not take
with you any such property or any reproduction of such property upon
such termination.
(d) Any work or research or the results thereof, made or developed by you,
alone or in conjunction with others during the term of your
employment, including but without limitation, any designs, patents,
inventions, processes, know-how or formulae created, invented or
conceived during the period of your employment by
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the Company, whether during or out of the usual hours of work, which
arise out of or are related to the business, research, or
development work or field of operation of the Company, or any of its
affiliates, shall to the extent of your interest therein be the sole
and exclusive property of the Company, shall be disclosed in writing
to the Company and to no other person, unless so directed in writing
by the Board of Directors, and you hereby assign to the Company all
and any right which you have or may acquire in the same. To this
end, both during the period of your employment and at all times
thereafter, you agree to execute all necessary papers, instruments
and documents properly required to effect such assignment to the
Company or its nominee, to make application through the Company's
patent attorney or general counsel at the expense of the Company,
for such United States and foreign patents as may be specified from
time to time by the Company on inventions, processes, or formulae
which are or become the property of the Company hereunder, and to
execute assignments upon the Company's request, for your entire
interest in all such applications to the Company or to its nominee
without compensation (other than your usual compensation as an
employee of the Company) and you agree to give the Company and its
patent attorney or general counsel all reasonable assistance in
preparing such applications, descriptions, and illustrations of each
such invention, process, or formula and in connection with
proceedings relating thereto or to such other applications or
patents resulting therefrom; and further agree to execute all lawful
papers considered necessary by the Company and do all that the
Company reasonably requests in order to protect the Company's rights
in said inventions, processes, and formulae or to obtain patents
thereon, including, without limitation, continuations, reissues,
renewals, and extensions. It is further agreed that your obligations
specified hereunder shall not expire with the termination of this
Agreement or your employment, but the Company agrees to pay you a
reasonable amount for any time that you spend in such work at the
Company's request after the termination of this Agreement or your
employment hereunder and agrees to reimburse you for expenses
reasonably or necessarily incurred in connection with such work.
(e) In consideration of your continued employment by the Company, and the
other benefits accruing to you hereunder, and subject to the
fulfillment by the Company of its obligations to you hereunder, you
agree that during the term of this Agreement and for a period of
thirty-six (36) months following the date of termination of your
employment pursuant to Section 2 hereof (such period of employment and
thirty-six (36) month period being referred to in this Agreement as
the "Non-Competition Period"), you will not engage or participate,
directly or indirectly, within the United States of America or Canada
either as principal, agent, employee, employer, consultant,
stockholder, partner or in any other individual or representative
capacity whatever, in the conduct or management of, or own any stock
or other proprietary interest in, or debt of, any business which
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shall be competitive with any business which is or was conducted by
the Company or any affiliate of the Company, while you were an
employee of the Company, unless you shall have obtained the prior
written consent of the Board of Directors, and which consent shall
make express reference to this Agreement. Notwithstanding any other
provision in this Section 6, you shall be free without such consent to
make investments, directly or indirectly, in the securities of any
publicly-owned entity if your ownership thereof is limited to not more
than three percent (3%) of the issued and outstanding securities of
any class of securities of such entity. You acknowledge that your
skills and your experience are such that you can anticipate finding
employment at an executive level in a wide variety of industries and
represent and agree that the restrictions imposed by this Section 6 on
employment are necessary for the protection of the legitimate
interests and competitive position of the Company and do not impose
undue hardships on you.
(f) During the Non-Competition Period, you shall not, directly or
indirectly, solicit any officer, director, executive, employee or
consultant of the Company or any affiliate of the Company to leave
such employment or terminate such position.
7. NO CONFLICTING AGREEMENTS. You hereby represent and warrant that you
have no commitments or obligations inconsistent with this Agreement and you
hereby agree to indemnify and hold the Company harmless against loss, damage,
liability or expense arising from any claim based upon circumstances alleged to
be inconsistent with such representation and warranty.
8. General.
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(a) NOTICES. All notices, requests, consents and other communications
hereunder shall be in writing, shall be addressed to the receiving party's
address set forth below or to such other address as a party may designate by
notice hereunder, and shall be either (i) delivered by hand, (ii) made by telex,
telecopy or facsimile transmission, (iii) sent by overnight courier, or (iv)
sent by registered or certified mail, return receipt requested, postage prepaid.
If to Xxxxxxx X. Xxxxxxx: Xxxxxxx X. Xxxxxxx
00 Xxxxxx Xxxx
Xxxxxxxxx, XX 00000
If to the Company: Ekco Group, Inc.
00 Xxxx Xxxxx Xxxx
Xxxxxx, XX 00000
Attn: Executive Vice President
and General Counsel
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All notices, requests, consents and other communications hereunder shall be
deemed to have been given either (i) if by hand, at the time of the delivery
thereof to the receiving party at the address of such party set forth above,
(ii) if made by telex, telecopy or facsimile transmission, at the time that
receipt thereof has been acknowledged by electronic confirmation or otherwise,
(iii) if sent by overnight courier, on the next business day following the day
such notice is delivered to the courier service, or (iv) if sent by registered
or certified mail, on the fifth (5th) business day following the day such
mailing is made.
(b) ENTIRE AGREEMENT. This Agreement and the Option Agreement embody the
entire agreement and understanding between the parties hereto with respect to
the subject matter hereof and supersede all prior oral or written agreements and
understandings relating to the subject matter hereof. No statement,
representation, warranty, covenant or agreement of any kind not expressly set
forth in this Agreement shall affect, or be used to interpret, change or
restrict, the express terms and provisions of this Agreement.
(c) MODIFICATIONS AND AMENDMENTS. The terms and provisions of this
Agreement may be modified or amended only by written agreement executed by the
parties hereto.
(d) WAIVERS AND CONSENTS. The terms and provisions of this Agreement may be
waived, or consent for the departure therefrom granted, only by written document
executed by the party entitled to the benefits of such terms or provisions. No
such waiver or consent shall be deemed to be or shall constitute a waiver or
consent with respect to any other terms or provisions of this Agreement, whether
or not similar. Each such waiver or consent shall be effective only in the
specific instance and for the purpose for which it was given, and shall not
constitute a continuing waiver or consent.
(e) ASSIGNMENT. The Company may assign its rights and obligations hereunder
to any person or entity who succeeds to all or substantially all of the
Company's business or that aspect of the Company's business in which you are
principally involved. Your rights and obligations under this Agreement may not
be assigned by you without the prior written consent of the Company.
(f) BENEFIT. All statements, representations, warranties, covenants and
agreements in this Agreement shall be binding on the parties hereto and shall
inure to the benefit of the respective successors and permitted assigns of each
party hereto. Nothing in this Agreement shall be construed to create any rights
or obligations except among the parties hereto, and no person or entity shall be
regarded as a third-party beneficiary of this Agreement.
(g) GOVERNING LAW. This Agreement and the rights and obligations of the
parties hereunder shall be construed in accordance with and governed by the law
of the State of New Hampshire without giving effect to the conflict of law
principles thereof.
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(h) ARBITRATION. Except with respect to the provisions of Section 6 hereof,
any controversy, dispute or claim arising out of or in connection with this
Agreement, or the breach, termination or validity hereof, shall be settled by
final and binding arbitration to be conducted by an arbitration tribunal in
Boston, MA, pursuant to the rules of the American Arbitration Association. The
arbitration tribunal shall consist of three arbitrators. The party initiating
arbitration shall nominate one arbitrator in the request for arbitration and the
other party shall nominate a second in the answer thereto within thirty (30)
days of receipt of the request. The two arbitrators so named will then jointly
appoint the third arbitrator. If the answering party fails to nominate its
arbitrator within the thirty (30) day period, or if the arbitrators named by the
parties fail to agree on the third arbitrator with sixty (60) days, the office
of the American Arbitration Association in Boston, MA shall make the necessary
appointments of such arbitrator(s). The decision or award of the arbitration
tribunal (by a majority determination, or if there is no majority, then by the
determination of the third arbitrator, if any) shall be final, and judgment upon
such decision or award may be entered in any competent court or application may
be made to any competent court for judicial acceptance of such decision or award
and an order of enforcement. In the event of any procedural matter not covered
by the aforesaid rules, the procedural law of the State of New Hampshire shall
govern.
(i) JURISDICTION AND SERVICE OF PROCESS. Any legal action or proceeding
with respect to this Agreement may be brought in the courts of the State of New
Hampshire or of the United States of America for the District of New Hampshire.
By execution and delivery of this Agreement, each of the parties hereto accepts
for itself and in respect of its property, generally and unconditionally, the
jurisdiction of the aforesaid courts. Each of the parties hereto irrevocably
consents to the service of process of any of the aforementioned courts in any
such action or proceeding by the mailing of copies thereof by certified mail,
postage prepaid, to the party at its address set forth in Section 8(a) hereof.
(j) SEVERABILITY. The parties intend this Agreement to be enforced as
written. However, (i) if any portion or provision of this Agreement shall to any
extent be declared illegal or unenforceable by a duly authorized court having
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law; and (ii) if any provision, or part thereof, is
held to be unenforceable because of the duration of such provision or the
geographic area covered thereby, the Company and you agree that the court making
such determination shall have the power to reduce the duration and/or geographic
area of such provision, and/or to delete specific words and phrases
("blue-pencilling"), and in its reduced or blue-pencilled form such provision
shall then be enforceable and shall be enforced.
(k) HEADINGS AND CAPTIONS. The headings and captions of the various
subdivisions of this Agreement are for convenience of reference only and shall
in no way modify, or affect the meaning or construction of any of the terms or
provisions hereof.
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(l) NO WAIVER OF RIGHTS, POWERS AND REMEDIES. No failure or delay by a
party hereto in exercising any right, power or remedy under this Agreement, and
no course of dealing between the parties hereto, shall operate as a waiver of
any such right, power or remedy of the party. No single or partial exercise of
any right, power or remedy under this Agreement by a party hereto, nor any
abandonment or discontinuance of steps to enforce any such right, power or
remedy, shall preclude such party from any other or further exercise thereof or
the exercise of any other right, power or remedy hereunder. The election of any
remedy by a party hereto shall not constitute a waiver of the right of such
party to pursue other available remedies. No notice to or demand on a party not
expressly required under this Agreement shall entitle the party receiving such
notice or demand to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the party giving such
notice or demand to any other or further action in any circumstances without
such notice or demand.
(m) EXPENSES. Should any party breach this Agreement, in addition to all
other remedies available at law or in equity, such party shall pay all of any
other party's costs and expenses resulting therefrom and/or incurred in
enforcing this Agreement, including legal fees and expenses.
(n) COUNTERPARTS. This Agreement may be executed in one or more
counterparts, and by different parties hereto on separate counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
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If the foregoing accurately sets forth our agreement, please so indicate by
signing and returning to us the enclosed copy of this letter.
Very truly yours,
EKCO GROUP, INC.
By: /s/ XXXXXX X. XxXXXXXXXX
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Name: Xxxxxx X. XxXxxxxxxx
Title: EVP/CFO
Accepted and Approved
/s/ XXXXXXX X. XXXXXXX
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Xxxxxxx X. Xxxxxxx
Dated: 12/4/96
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