Contract
Exhibit
10.3
1. Employment.
Employer agrees
to
employ Executive and Executive accepts such employment for the period beginning
as of October 1st
2007 and ending upon his separation pursuant to Section
1(c) hereof (the “Employment
Period”).
(a)
Position
and Duties.
(i)
During the Employment Period, Executive shall serve as the Senior Vice
President, International of Employer and shall have the normal duties,
responsibilities and authority implied by such position, subject to the power
of
the Chief Executive Officer of Employer and the Board to expand or limit
such
duties, responsibilities and authority and to override such
actions.
(ii)
Executive shall report to the Chief Executive Officer of Employer, and Executive
shall devote his best efforts and his full business time and attention to
the
business and affairs of the Company, Employer and their Subsidiaries.
(b)
Salary,
Bonus and Benefits. During the Employment Period, Employer
will pay Executive a base salary of $213,000 per annum (the “Annual
Base Salary”). In addition, the Executive shall be eligible for and
participate in the Annual Incentive Compensation Plan (the “Annual Bonus”) under
which the Executive shall be eligible for an annual Target Bonus payment
of 45%
of Annual Base Salary. Executive is eligible for the Long Term Incentive
Plan of
the company. During the Employment Period, Executive will be entitled to
such
other benefits approved by the Board and made available to the senior management
of the Company, Employer and their Subsidiaries, which shall include vacation
time (four weeks per year) and medical, dental, life and disability
insurance. The Board, on a basis consistent with past practice, shall
review the Annual Base Salary of Executive and may increase the Annual Base
Salary by such amount as the Board, in its sole discretion, shall deem
appropriate. The term “Annual Base Salary” as used in this Agreement
shall refer to the Annual Base Salary as it may be so increased.
(c)
Separation. The
Employment Period will continue until (i) Executive’s death, disability or
resignation from employment with the Company, Employer and their respective
Subsidiaries or (ii) the Company, Employer and their respective Subsidiaries
decide to terminate Executive’s employment with or without Cause. If
(A) Executive’s employment is terminated without Cause pursuant to clause (ii)
above or (B) Executive resigns from employment with the Company, Employer
or any
of their respective Subsidiaries for Good Reason, then during the period
commencing on the date of termination of the Employment Period and ending
on the
first anniversary of the date of termination (the “Severance
Period”), Employer shall pay to Executive, in equal installments on the
Employer’s regular salary payment dates, an aggregate amount equal to (I) his
Annual Base Salary, plus (II) an amount equal to the Annual Bonus, if any,
paid
Annual
Bonus, if any, paid or payable to Executive by Employer for the last fiscal
year
ended prior to the date of termination. In addition, if Executive is entitled
on
the date of termination to coverage under the medical and prescription portions
of the Welfare Plans, such coverage shall continue for Executive and Executive’s
covered dependents for a period ending on the first anniversary of the date
of
termination at the active employee cost payable by Executive with respect
to
those costs paid by Executive prior to the date of termination; provided,
that this coverage will count towards the depletion of any continued health
care
coverage rights that Executive and Executive’s dependents may have pursuant to
the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”);
provided
further, that Executive’s or Executive’s covered dependents’ rights to continued
health care coverage pursuant to this Section
1(c) shall terminate at the time Executive or Executive’s covered
dependents become covered, as described in COBRA, under another group health
plan, and shall also terminate as of the date Employer ceases to provide
coverage to its senior executives generally under any such Welfare
Plan. Notwithstanding the foregoing, (I) Executive shall not be
entitled to receive any payments or benefits pursuant to this Section
1(c) unless Executive has executed and delivered to Employer a general
release in form and substance satisfactory to Employer and (II) Executive
shall
be entitled to receive such payments and benefits only so long as Executive
has
not breached the provisions of Section
2 or Section
3 hereof. The release described in the foregoing sentence
shall not require Executive to release any claims for any vested employee
benefits, workers compensation benefits covered by insurance or self-insurance,
claims to indemnification to which Executive may be entitled under Employer’s or
its Subsidiaries’ certificate(s) of incorporation, by-laws or under any of
Employer’s or its Subsidiaries’ directors or officers insurance policy(ies) or
applicable law, or equity claims to contribution from Employer or its
Subsidiaries or any other Person to which Executive is entitled as a matter
of
law in respect of any claim made against Executive for an alleged act or
omission in Executive’s official capacity and within the scope of Executive’s
duties as an officer, director or employee of Employer or its Subsidiaries.
Not
later than eighteen (18) months following the termination of Executive’s
employment, Employer and its Subsidiaries for which the Executive has acted
in
the capacity of a senior manager, shall sign and deliver to Executive a release
of claims that Employer and its Subsidiaries have against Executive;
provided
that, such release shall not release any claims that Employer and/or its
Subsidiaries commenced prior to the date of the release(s), any claims relating
to matters actively concealed by Executive, any claims to contribution from
Executive to which Employer or its Subsidiaries are entitled as a matter
of law
or any claims arising out of mistaken indemnification by Employer and/or
any of
its Subsidiaries. Except as otherwise provided in this Section
1(c) or in the Employer’s employee benefit plans or as otherwise required
by applicable law, Executive shall not be entitled to any other salary,
compensation or benefits after termination of Executive’s employment with
Employer.
2. Confidential
Information.
(a)
Obligation
to Maintain Confidentiality. Executive acknowledges that the
information, observations and data (including trade secrets) obtained by him
during the course of his performance under this Agreement concerning the
business or affairs of Employer, its Subsidiaries and Affiliates (“Confidential
Information”) are the property of Employer, its Subsidiaries and
Affiliates, as applicable, including information concerning acquisition
opportunities in or reasonably related to Employer’s, its Subsidiaries’ and/or
Affiliates’ business or industry of which Executive becomes aware during the
Employment Period. Therefore, Executive agrees that he will not disclose to
any
unauthorized Person or use for his own account (for his commercial advantage
or
otherwise) any Confidential Information without the Board’s written consent,
unless and to the extent that the Confidential Information, (i) becomes
generally known to and available for use by the public other than as a result
of
Executive’s acts or omissions to act, (ii) was known to Executive prior to
Executive’s employment with Employer or any of its Subsidiaries or Affiliates or
(iii) is required to be disclosed pursuant to any applicable law, court order
or
other governmental decree. Executive shall deliver to Employer at a
Separation, or at any other time Employer may request, all memoranda, notes,
plans, records, reports, computer tapes, printouts and software and other
documents and data (and copies thereof) relating to the Confidential
Information, Work Product (as defined below) or the business of the Employer,
its Subsidiaries and Affiliates (including, without limitation, all acquisition
prospects, lists and contact information) which he may then possess or have
under his control.
(b)
Ownership
of Property. Executive acknowledges that all discoveries,
concepts, ideas, inventions, innovations, improvements, developments, methods,
processes, programs, designs, analyses, drawings, reports, patent applications,
copyrightable work and mask work (whether or not including any Confidential
Information) and all registrations or applications related thereto, all other
proprietary information and all similar or related information (whether or
not
patentable) that relate to Employer’s, its Subsidiaries’ and/or Affiliates’
actual or anticipated business, research and development, or existing or future
products or services and that are conceived, developed, contributed to, made,
or
reduced to practice by Executive (either solely or jointly with others) while
employed by the Employer, its Subsidiaries and/or Affiliates (including any
of
the foregoing that constitutes any proprietary information or records) (“Work
Product”) belong to the Employer or such Subsidiary or Affiliate and
Executive hereby assigns, and agrees to assign, all of the above Work Product
to
Employer or to such Subsidiary or Affiliate. Any copyrightable work
prepared in whole or in part by Executive in the course of his work for any
of
the foregoing entities shall be deemed a “work made for hire” under the
copyright laws, and Employer or such Subsidiary or Affiliate shall own all
rights therein. To the extent that any such copyrightable work is not
a “work made for hire,” Executive hereby assigns and agrees to assign to
Employer or such Subsidiary or Affiliate all right, title, and interest,
including without limitation, copyright in and to such copyrightable
work. Executive shall
promptly
disclose such
Work Product and copyrightable work to the Board and perform all actions
reasonably requested by the Board (whether during or after the Employment
Period) to establish and confirm the Employer’s or such Subsidiary’s or
Affiliate’s ownership (including, without limitation, assignments, consents,
powers of attorney, and other instruments).
(c)
Third
Party Information. Executive understands that Employer, its Subsidiaries
and Affiliates will receive from third parties confidential or proprietary
information (“Third
Party Information”), subject to a duty on Employer’s, its Subsidiaries’
and Affiliates’ part to maintain the confidentiality of such information and to
use it only for certain limited purposes. During the Employment
Period and thereafter, and without in any way limiting the provisions of Section
2(a) above, Executive will hold Third Party Information in the strictest
confidence and will not disclose to anyone (other than personnel and consultants
of Employer, its Subsidiaries and Affiliates who need to know such information
in connection with their work for Employer or any of its Subsidiaries and
Affiliates) or use, except in connection with his work for Employer or any
of
its Subsidiaries and Affiliates, Third Party Information unless expressly
authorized by a member of the Board (other than himself if Executive is on
the
Board) in writing.
(d)
Use
of Information of Prior Employers. During the Employment
Period and thereafter, Executive will not improperly use or disclose any
confidential information or trade secrets, if any, of any former employers
or
any other Person to whom Executive has an obligation of confidentiality, and
will not bring onto the premises of Employer or any of its Subsidiaries or
Affiliates any unpublished documents or any property belonging to any former
employer or any other Person to whom Executive has an obligation of
confidentiality unless consented to in writing by the former employer or
Person. Executive will use in the performance of his duties only
information which is (i) generally known and used by persons with training
and
experience comparable to Executive’s and which is (x) common knowledge in the
industry or (y) otherwise legally in the public domain, (ii) otherwise provided
or developed by Employer or any of its Subsidiaries or Affiliates or (iii)
in
the case of materials, property or information belonging to any former employer
or other Person to whom Executive has an obligation of confidentiality, approved
for such use in writing by such former employer or Person.
3.
Non-competition
and No Solicitation. Executive
acknowledges that (i) the course of his employment with Employer he will become
familiar with Employer's, its Subsidiaries’ and Affiliates’ trade secrets and
with other confidential information concerning the Employer, its Subsidiaries
and Affiliates; and (ii) his services will be of special, unique and
extraordinary value to Employer and such Subsidiaries. Therefore,
Executive agrees that:
(a)
Non-competition. During
the Employment Period and also during the period commencing on the date of
termination of the Employment Period and
ending
on the first anniversary of the date of termination, he shall not without the
express written consent of Employer, anywhere in the world, directly or
indirectly, own, manage, control, participate in, consult with, render services
for, or in any manner engage in any business (i) which competes with (a) OTC
wart treatment products (including, without limitation, cryogen-based products),
(b) devices for treatment or management of bruxism, (c) OTC sore throat
treatment products (including, without limitation, liquids, lozenges and
strips), (d) inter-proximal devices, (e) copper scrubbers, (f) powdered and
liquid cleansers, (g) pediatric OTC medicinal products, or (h) any other
business acquired by Employer and its Subsidiaries after the date hereof which
represents 5% or more of the consolidated revenues or EBITDA of Employer and
its
Subsidiaries for the trailing 12 months ending on the last day of the last
completed calendar month immediately preceding the date of termination of the
Employment Period, or (ii) in which Employer and/or its Subsidiaries have
conducted discussions or have requested and received information relating to
the
acquisition of such business by such Person (x) within one year prior to the
Separation and (y) during the Severance Period, if any. Nothing
herein shall prohibit Executive from being a passive owner of not more than
2%
of the outstanding stock of any class of a corporation that is publicly traded,
so long as Executive has no active participation in the business of such
corporation
(b)
No
solicitation. During the Employment Period and also during the
period commencing on the date of termination of the Employment Period and ending
on the first anniversary of the date of termination, Executive shall not
directly or indirectly through another entity (i) induce or attempt to induce
any employee of Employer or its Subsidiaries to leave the employ of Employer
or
its Subsidiaries, or in any way interfere with the relationship between Employer
or its Subsidiaries and any employee thereof, (ii) hire any person who was
an
employee of Employer or its Subsidiaries within 180 days after such person
ceased to be an employee of Employer or its Subsidiaries (provided,
however,
that
such restriction shall not apply for a particular employee if Employer or its
Subsidiaries have provided written consent to such hire, which consent, in
the
case of any person who was not a key employee of Employer or its
Subsidiaries shall not be unreasonably withheld), (iii) induce or
attempt to induce any customer, supplier, licensee or other business relation
of
Employer or its Subsidiaries to cease doing business with Employer or its
Subsidiaries or in any way interfere with the relationship between any such
customer, supplier, licensee or business relation and Employer or its
Subsidiaries or (iv) directly or indirectly acquire or attempt to acquire an
interest in any business relating to the business of Employer or its
Subsidiaries and with which Employer or its Subsidiaries have conducted
discussions or have requested and received information relating to the
acquisition of such business by Employer or its Subsidiaries in the two year
period immediately preceding a Separation.
(c)
Enforcement. If,
at the time of enforcement of Section
2 or this Section
3, a court holds that the restrictions stated herein are unreasonable
under circumstances then existing, the parties hereto agree that the maximum
duration,
scope
or geographical area reasonable under such circumstances shall be substituted
for the stated period, scope or area and that the court shall be allowed to
revise the restrictions contained herein to cover the maximum duration, scope
and area permitted by law. Because Executive’s services are unique
and because Executive has access to Confidential Information, the parties hereto
agree that money damages would be an inadequate remedy for any breach of this
Agreement. Therefore, in the event of a breach or threatened breach
of this Agreement, Employer, its Subsidiaries or their successors or assigns
may, in addition to other rights and remedies existing in their favor, apply
to
any court of competent jurisdiction for specific performance and/or injunctive
or other relief in order to enforce, or prevent any violations of, the
provisions hereof (without posting a bond or other security).
(d)
Additional
Acknowledgments. Executive acknowledges that the provisions of
this Section
3 are in consideration of: (i) employment with the Employer,
(ii) the prospective issuance of securities by Employer pursuant to the
Long-Term Equity Incentive Plan and (iii) additional good and valuable
consideration as set forth in this Agreement. In addition, Executive
agrees and acknowledges that the restrictions contained in Section
2 and this Section
3 do not preclude Executive from earning a livelihood, nor do they
unreasonably impose limitations on Executive’s ability to earn a
living. In addition, Executive acknowledges (i) that the business of
Employer and its Subsidiaries will be conducted throughout the world, (ii)
notwithstanding the state of incorporation or principal office of Employer
or
any of its Subsidiaries, or any of their respective executives or employees
(including the Executive), it is expected that Employer and its Subsidiaries
will have business activities and have valuable business relationships within
its industry throughout the world and (iii) as part of his responsibilities,
Executive will be traveling throughout the world in furtherance of Employer’s
and/or its Subsidiaries’ business and their relationships. Executive
agrees and acknowledges that the potential harm to Employer and its Subsidiaries
of the non-enforcement of Section
2 and this Section
3 outweighs any potential harm to Executive of their enforcement by
injunction or otherwise. Executive acknowledges that he has carefully
read this Agreement and has given careful consideration to the restraints
imposed upon Executive by this Agreement, and is in full accord as to their
necessity for the reasonable and proper protection of confidential and
proprietary information of Employer and its Subsidiaries now existing or to
be
developed in the future. Executive expressly acknowledges and agrees
that each and every restraint imposed by this Agreement is reasonable with
respect to subject matter, time period and geographical area.
4.
Miscellaneous.
(a)
Survival. The
provisions of Sections 1(c), 2, 3 and 4 shall survive the termination of this
Agreement.
(b)
Entire
Agreement. This Agreement sets forth the entire understanding
of the parties and merges and supersedes any prior or
contemporaneous
agreements, whether written or oral, between the parties pertaining to the
subject matter hereof.
(c)
Modification. This
Agreement may not be modified or terminated orally, and no modification or
waiver of any of the provisions hereof shall be binding unless in writing and
signed by the party against whom the same is sought to be enforced.
(d)
Waiver. Failure
of a party to enforce one or more of the provisions of this Agreement or to
require at any time performance of any of the obligations hereof shall not
be
construed to be a waiver of such provisions by such party nor to in any way
affect the validity of this Agreement or such party's right thereafter to
enforce any provision of this Agreement, nor to preclude such party from taking
any other action at any time which it would legally be entitled to
take.
(e)
Successors
and Assigns. Neither party shall have the right to assign this
Agreement, or any rights or obligations hereunder, without the consent of the
other party; provided, however, that upon the sale of all or substantially
all
of the assets, business and goodwill of Employer to another company, or upon
the
merger or consolidation of Employer with another company, this Agreement shall
inure to the benefit of, and be binding upon, both Executive and the company
purchasing such assets, business and goodwill, or surviving such merger or
consolidation, as the case may be, in the same manner and to the same extent
as
though such other company were Employer; and provided, further, that Employer
shall have the right to assign this Agreement to any Affiliate or Subsidiary
of
Employer. Subject to the foregoing, this Agreement shall inure to the
benefit of, and be binding upon, the parties hereto and their legal
representatives, heirs, successors and permitted assigns.
(f)
Communications. All
notices or other communications required or permitted hereunder will be in
writing and will be deemed given or delivered when delivered personally, by
registered or certified mail or by overnight courier (fare prepaid) addressed
as
follows:
| (i) | To Employer: | Prestige Brands Holdings, Inc. |
| 00 Xxxxx Xxxxxxxx | ||
| Xxxxxxxxx, Xxx Xxxx 00000 | ||
| Attention: Chief Executive Officer |
| (ii) | With a copy to: | Prestige Brands Holdings, Inc. |
| 00 Xxxxx Xxxxxxxx | ||
| Xxxxxxxxx, Xxx Xxxx 00000 | ||
| Attention: Legal Department |
| (iii) | To the Employee: | Xxxx Xxxxxxxxx |
| 000 X. 00xx Xxxxxx, Xxx. 0X | ||
| Xxx Xxxx, Xxx Xxxx 00000 |
or
to
such address as a party hereto may indicate by a notice delivered to the other
party. Notice will be deemed received the same day when delivered
personally, five (5) days after mailing when sent by registered or certified
mail, and the next business day when delivered by overnight
courier. Any party hereto may change its address to which all
communications and notices may be sent by addressing notices of such change
in
the manner provided.
(g)
Severability. If
any provision of this Agreement is held to be invalid or unenforceable by a
court of competent jurisdiction, such invalidity or unenforceability shall
not
affect the validity and enforceability of the other provisions of this Agreement
and the provision held to be invalid or unenforceable shall be enforced as
nearly as possible according to its original terms and intent to eliminate
such
invalidity or unenforceability.
(h)
Governing
Law. This Agreement will be governed by, construed and
enforced in accordance with the laws of the State of New York, without giving
effect to its conflicts of law provisions.
(i)
Jurisdiction;
Venue. THIS AGREEMENT SHALL BE SUBJECT TO THE EXCLUSIVE
JURISDICTION OF THE STATE OR FEDERAL COURTS SITTING IN WESTCHESTER COUNTY,
NEW
YORK. THE PARTIES TO THIS AGREEMENT IRREVOCABLY AND EXPRESSLY AGREE
TO SUBMIT TO THE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK OR COURTS OF THE STATE OF NEW YORK IN WESTCHESTER
COUNTY, NEW YORK FOR THE PURPOSE OF RESOLVING ANY DISPUTES AMONG THE PARTIES
RELATING TO THIS AGREEMENT. THE PARTIES IRREVOCABLY WAIVE, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH THEY MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF
OR
RELATING TO THIS AGREEMENT, OR ANY JUDGMENT ENTERED BY ANY COURT IN RESPECT
HEREOF, BROUGHT IN WESTCHESTER COUNTY, NEW YORK, AND FURTHER IRREVOCABLY WAIVE
ANY CLAIM THAT ANY SUIT, ACTION OR PROCEEDING BROUGHT IN WESTCHESTER COUNTY,
NEW
YORK HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. THE PARTIES HERETO
AGREE TO SERVICE OF PROCESS BY CERTIFIED OR REGISTERED UNITED STATES MAIL,
POSTAGE PREPAID, ADDRESSED TO THE PARTY IN QUESTION.
(j)
Waiver
of Jury Trial. EACH PARTY TO THIS AGREEMENT WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
BY
JURY IN RESPECT OF ANY ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING
TO
THIS AGREEMENT.
(k)
No
Third-Party Beneficiaries. Each of the provisions of this
Agreement is for the sole and exclusive benefit of the parties hereto and shall
not be deemed for the benefit of any other person or entity.
(l)
Code
Section 409A. The parties to this Agreement intend that the
Agreement complies with Section 409A of the Internal Revenue Code, where
applicable, and this Agreement shall be interpreted in a manner consistent
with
that intention. To the extent not otherwise provided by this Agreement,
and solely to the extent required by Section 409A of the Code, no payment or
other distribution required to be made to the Executive hereunder (including
any
payment of cash, any transfer of property and any provision of taxable benefits)
as a result of his termination of employment with Employer shall be made earlier
than the date that is six (6) months and one day following the date on which
the
Executive separates from service with Employer any and its affiliates (within
the meaning of Section 409A of the Code).
(m)
Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall
be
deemed an original but all of which together will constitute one and the same
instrument.
[Remainder
of page
intentionally left blank]
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
first written above.
| PRESTIGE BRANDS HOLDINGS, INC. | |||
| By: | /s/ Xxxx Xxxxxx | ||
| Name: | Xxxx Xxxxxx | ||
| Title: | Chairman and Chief Executive | ||
| Officer | |||
| /s/ Xxxx Xxxxxxxxx | |||
| Xxxx Xxxxxxxxx | |||
DEFINITIONS
“Affiliate”
means,
with
respect to any Person, any other Person who directly or indirectly, through
one
or more intermediaries, controls, is controlled by, or is under common control
with, such Person. The term “control” means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting securities,
by
contract or otherwise, and the terms “controlled” and “controlling” have
meanings correlative thereto.
“Cause”
is
defined as (i)
your willful and continued failure to substantially perform your
duties with Employer (other than any such failure resulting from your incapacity
due to physical or mental illness) that has not been cured within 10
days after a written demand for substantial performance is delivered to you
by
the Board, which demand specifically identifies the manner in which the Board
believes that you have not substantially performed your duties, (ii) the willful
engaging by you in conduct which is demonstrably and materially injurious to
Employer or its Affiliates, monetarily or otherwise, (iii) your conviction
(or
plea of nolo contendere) for any felony or any other crime involving dishonesty,
fraud or moral turpitude, (iv) your breach of fiduciary duty to Employer or
its
Affiliates, (v) any violation of Employer's policies relating to compliance
with
applicable laws which have a material adverse effect on Employer or its
Affiliates or (vi) your breach of any restrictive covenant. For
purposes of clauses (i) and (ii) of this definition, no act, or failure to
act,
on your part shall be deemed "willful" unless done, or omitted to be done,
by
you not in good faith and without reasonable belief that your act, or failure
to
act, was in the best interest of Employer.
“Good
Reason” is defined as, without your consent, (i) the assignment to you of any
duties inconsistent with your status as the Senior Vice President, International
or a substantial adverse alteration in the nature or status of the your
responsibilities, unless Employer has cured such events within 10 business
days
after the receipt of written notice thereof from you, (ii) a reduction in your
annual base salary or target annual bonus percentage, except for
across-the-board salary reductions similarly affecting all senior executives
of
Employer, or (iii) the relocation of Employer's headquarters by more than 30
miles.
“Person”
means
any person
or entity, whether an individual, trustee, corporation, limited liability
company, partnership, trust, unincorporated organization, business association,
firm, joint venture, governmental authority or similar entity.
“Subsidiary”
of
any
specified Person shall mean any corporation fifty percent (50%) or more of
the
outstanding capital stock of which, or any partnership, joint venture, limited
liability company or other entity fifty percent (50%) or more of the ownership
interests of which, is directly or indirectly owned or controlled by such
