EXHIBIT 10
September 6, 1995
Mr. Raymond J. Kulla
130 Michaux
Riverside, IL 60546
Dear Ray:
After what has been a very professionally handled interview process through
Tucker Olson, I feel very positive and I am very enthused about the chemistry
between you and me, between you and the board members you have spoken to
and
between you and the other officers of the company. It is very clear to me
that your background, experience, cultural outlook, character, and style
provide for an almost ideal fit into the situation described by the employment
package below. And based on all of the above, I believe you have a
longer-term opportunity here, if all goes as I think it will, to move into
areas of management that go beyond the parameters of the position outlined
below, at some point in the future.
The immediate opportunity, however, is, in my opinion, exciting in and of
itself. The company is growing, of course, but that growth is not without
challenges that we encounter continually. We are in a relatively stable
industry, -- certainly in terms of technology -- but also regarding the key
marketing elements: product, price, promotion. But the challenges in a
business such as ours center around intellectual property, acquisition of
new businesses, techno-legal relationships with large customers, governmental
intervention and regulation of various kinds, human resource issues -- in
particular those related to acquired business --contract creation, and
SEC/NYSE relationships. These demands have increased in volume and intensity
over the past few years, and the importance of the legal function in our
business has increased accordingly.
As you evaluate the offer below, I know you will be cognizant of your
experience at GHC, brief as it has been, and the opportunities, the fit, and
the chemistry. I am personally delighted to send you this letter and will be
even more so when you join GHC.
TITLE: Corporate Vice President, General Counsel, and Secretary
REPORTING
RELATIONSHIP: Reports to the President and Chief Executive Officer of
General Housewares Corp.
SCOPE OF
RESPONSIBILITY: Management responsibility for legal affairs of the
Company.
BASE SALARY: $160,000 per year.
INCENTIVE
COMPENSATION: Participate in corporate-wide incentive compensation plan
with top-end awards of 68% of base salary assuming
corporate goals are met.*
For 1995, you will be included in the incentive
compensation plan now in effect on a pro-rated basis.
Assuming your start date is October 1, 1995, and the
maximum goals were achieved, you would receive 68% of your
salary earned from October 1, until December 31, 1995.
STOCK OPTIONS: An option of 10,000 shares at the market value on your
date of employment will be granted by the Compensation
Committee of the Board of Directors.
RESTRICTED STOCK: 3,000 shares of restricted stock at no cost to you which
will vest 2/3 twelve months from your date of employment
and 1/3 twelve months later will be granted by the
Compensation Committee of the Board of Directors.
LIFE INSURANCE: Group Life and Accidental Death and Dismemberment
insurance coverage, both at 3 1/2 times your base salary
up to $500,000 maximum, plus an additional $500,000 death
benefit for Travel Accident Coverage and a scheduled
portion thereof for dismemberment.
* 1995 Plan attached.
LONG-TERM
DISABILITY: Insured coverage for 60% of base salary up to a maximum of
$5,000 per month to age 65, effective six months after
disability occurs. Yearly premiums to be paid by you.**
MEDICAL PLAN/
DENTAL PLAN: Between regular group and supplemental key management
plans, we pay 100% of medical and dental expenses for you
and your eligible dependents. In your case, we will waive
all prior condition restrictions regarding medical
insurance for you and your dependents. If your present
medical plan, or your spouse's, cannot be extended either
through COBRA or some other means, the Company will
reimburse for private short-term health coverage until you
are eligible for coverage under the Company Plan.
401(K) SAVINGS
PLAN: After one year of employment, you are eligible to join our
401(K) plan at the beginning of the first quarter
following your one year anniversary. Company matches 50%
of contribution up to 6% of salary, subject to government
cap.
PENSION PLAN: Per Plan. Retirement income after 25 years of service
approximates 50% of five highest consecutive years of
salary out of the last ten years of employment, including
social security benefits. The GHC pension plan vests in
five years. For purposes of your pension calculation,
each year of service will be credited to your pension
at 1.5 years for both the vesting period and credited
service with a portion of your benefit being provided for
through a Company sponsored Supplemental Executive
Retirement Plan (SERP).
MOVING EXPENSES: The Company will pay 100% of all moving costs and up to
three months of interim personal living expenses
associated with your move to Terre Haute. This includes
personal commuting costs as well as housing in Terre Haute
prior to your move.
** At the present time, this program is under review and will be
improved.
AUTOMOBILE: You are entitled to a car lease allowance of $575.00 per
month, to be applied in full or in part to a car of your
choice. All maintenance expenses, replacement parts
(tires, etc.), gasoline and oil, and automobile insurance,
are paid for by GHC.
CLUB MEMBERSHIPS: You are entitled to initiation fees and dues to the
Country Club of Terre Haute and to the MVP Club in the
Boston Connection.
SEVERANCE: If the Company terminates your employment at any
time during the first six months of your employment at
GHC, you will be eligible for six months of severance as
well as any portion of management bonus accruing to
officers of the Company. In the event that the Company
decides to terminate your employment after six months, you
would receive severance payments (as defined below)
equalling your tenure at GHC, up to one full year. For
example if we part company after seven months, you would
receive seven months of severance; eight months, eight
months, etc., up to a full year. After one full year, the
severance is capped at one year of salary and whatever
portion of the management bonus is applicable.
Acceptance of this arrangement constitutes an agreement by
you not to pursue further remedies against GHC in the
event of your termination by the Company. You are also
covered under our severance compensation plan which
provides longer term severance in the event of certain
circumstances related to a takeover of the Company. A
copy of the present plan is attached.
EFFECTIVE DATE: __________ 1, 1995. GHC would be delighted to have you
join the Company as soon as you can. Personally, I will
be out of the country until October 7, returning to the
office on Monday, October 9. If you began on October 1,
you could begin working with Gordon Erickson, but, we
really want you to begin at your convenience.
The trip I am taking does have another significance however, and that is that
we'd like to get our answer from you by September 15, if possible. If you
agree to join GHC, obviously we can wind down our search. But if you do not,
we need to know as soon as possible so we can rekindle our efforts to find a
General Counsel.
Ray, since you have been interviewed and approved by five out of eight Board
Members, the following is almost moot, but this offer is conditioned upon the
final approval of the GHC Board of Directors, which, were you to accept, would
be granted expeditiously.
If there are any questions about this letter, or any suggestions, I would be
delighted to respond to them.
Sincerely,
/s/ Paul A. Saxton
ACCEPTED:
/s/ Raymond J. Kulla
Date