TRANSACTION BONUS AGREEMENT
Exhibit 10.1
EXECUTION VERSION
This TRANSACTION BONUS AGREEMENT (this “Agreement”) is made as of September 7, 2010,
between Associated Materials, LLC, a Delaware limited liability company (the “Company”),
and Xxxxxx Xxxxxxx (“Executive”).
R E C I T A L S
WHEREAS, Executive is the Chief Executive Officer of the Company; and
WHEREAS, the Company desires to encourage Executive’s contribution to the success and progress
of the Company and assist with causing the Company to enter into an Approved Sale (as defined
below).
NOW THEREFORE, in consideration of the mutual covenants set forth herein, and for other good
and valuable consideration, receipt of which is hereby acknowledged, the parties, intending to be
legally bound, do hereby agree as follows:
AGREEMENTS
1. Definitions.
“Approved Sale” means a transaction that results in a bona fide,
unaffiliated direct or indirect change of economic beneficial ownership of the Company, Parent or
their businesses of greater than 50%, whether pursuant to the sale of the stock of the Company or
Parent, the sale of the assets of the Company and its subsidiaries (if combined with a distribution
of net proceeds to stockholders), or a merger, consolidation or other reorganization (other than a
sale of stock by a Current Investor to another Current Investor or in connection with a
Consolidation Transaction).
“Consolidation Transaction” means a transaction or series of related transactions
(including mergers, reorganizations, liquidations, share exchanges and/or consolidations involving
the Company and one or more of its subsidiaries) effected to implement a reorganization of the
Company and one or more of its subsidiaries (or similar transactions) that does not result in a
material change in beneficial ownership of the voting securities of the Company or its successor.
“Current Investors” means the stockholders of Parent as of the date hereof.
“Parent” means AMH Holdings II, Inc., the indirect parent of the Company.
2. Transaction Bonus. Subject to Executive’s continued employment with the Company
through the closing date of the Approved Sale, within five days following an Approved Sale that
closes no later than December 31, 2010, the Company shall pay or cause to be paid to the Executive,
in cash, an amount equal to $1,416,000 (the “Transaction Bonus”). The Transaction Bonus
shall be subject to all applicable tax and other legally-required withholdings.
3. Stockholder Approval. Payment of the Transaction Bonus is subject to stockholder
approval meeting the requirements of Section 280G(b)(5) of the Code, and the regulations
promulgated thereunder, being obtained.
4. Not an Employment Contract. Nothing in this Agreement or any other instrument
executed pursuant hereto shall confer upon Executive any right to continue in the employ of the
Company or any of its subsidiaries or shall affect the right of the Company or any of its
subsidiaries to terminate the employment of Executive with or without cause.
5. Governing Law. All terms of and rights under this Agreement shall be governed by
and construed in accordance with the internal laws of the State of Delaware, without giving effect
to principles of conflicts of law.
6. Amendments and Waivers. This Agreement may be amended, and any provision hereof
may be waived, only by a writing signed by each party hereto.
7. Entire Agreement. This Agreement sets forth the entire agreement and understanding
between the parties as to the subject matter hereof and supersedes all prior oral and written and
all contemporaneous oral discussions, agreements and understandings of any kind or nature.
8. Separability. If any term or other provision of this Agreement is invalid, illegal
or incapable of being enforced by any rule of law, or public policy, all other conditions and
provisions of this Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated hereby is not affected in any manner
adverse to any party. Upon such determination that any term or other provision is invalid, illegal
or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as possible in an
acceptable manner to the end that transactions contemplated hereby are fulfilled to the maximum
extent possible.
9. Headings. The headings preceding the text of the sections hereof are inserted
solely for convenience of reference, and shall not constitute a part of this Agreement, nor shall
they affect its meaning, construction or effect.
10. Counterparts. This Agreement may be executed in two counterparts, each of which
shall be deemed an original, but which together shall constitute one and the same instrument.
11. Assignment; Binding Effect. This Agreement may not be assigned by Executive
without the prior written consent of the Company. This Agreement shall inure to the benefit of and
be binding upon the parties hereto and their respective permitted successors and assigns.
12. Termination. This Agreement shall terminate upon the earlier of (i) the failure
to consummate an Approved Sale on or before December 31, 2010 or (ii) the agreement in writing of
Parent and Executive to terminate this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written
above.
| ASSOCIATED MATERIALS, LLC |
||||
| By: | /s/ Xxxxxxx X. Xxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxx | |||
| Title: | Chief Financial Officer | |||
| /s/ Xxxxxx Xxxxxxx | ||||
| Xxxxxx Xxxxxxx | ||||
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