10.2-1
EMPLOYMENT AGREEMENT
This Agreement is made as of this 23rd day of July, 1996 by and
between CMC KALAMAZOO INC., a Delaware corporation with a mailing address at
2016 No. Pitcher St., Kalamazoo, Michigan 49007 (the "Company"), and Larry D.
Temple ("Employee"), residing at 395 Midlakes Boulevard, Plainwell, MI 49080.
In consideration of the mutual covenants contained in this Agreement, the
Company and the Employee hereby agree as follows:
ARTICLE 1
TERM OF EMPLOYMENT
1.1. TERM. The Company hereby employs the Employee and the
Employee accepts employment with the Company, on the terms and conditions of
this Agreement, for a period of three years commencing as of August 1, 1996,
and ending on July 31, 1999, unless otherwise terminated as provided herein.
The period during which Employee is employed hereunder is hereinafter
referred to as the "Term."
ARTICLE 2
DUTIES OF EMPLOYEE
2.1. DUTIES. During the Term, the Employee shall serve as Vice
President and Chief Operating Officer of the Company, shall perform such
services in a responsible executive or managerial capacity for such of the
Company's subsidiaries as may be requested by the President of the Company
and will devote his full time to the faithful and diligent performance of the
duties inherent in, and implied by, this executive position, subject to the
direction of the Board of Directors (the "Board"). Employee shall be
available to travel as the needs of the business require.
ARTICLE 3
COMPENSATION OF EMPLOYEE
3.1. BASE SALARY. As compensation for services rendered under
this Agreement, Employee shall be entitled to receive from the Company a
salary of $150,000 per year, as may be increased from time to time at the
sole discretion of the Board (the "Base Salary") payable in equal
installments in accordance with the Company's regular policy.
3.2. ADDITIONAL COMPENSATION. Employee shall be paid annually
such bonus for his services as may be determined, from time to time, in the
sole discretion of the Board.
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ARTICLE 4
EMPLOYEE BENEFITS
4.1. EMPLOYEE BENEFITS. Employee shall be entitled to benefits
in accordance with the Company's policy for executive officers and other
benefits provided to all salaried employees of the Company, with a vacation
period at the maximum allowable by the Company's policy. Employee
acknowledges that the foregoing does not require the Company to continue any
benefit or policy currently in effect or adopted hereafter.
ARTICLE 5
CONFIDENTIALITY AND NONCOMPETITION
5.1. NONDISCLOSURE OF CONFIDENTIAL INFORMATION
5.1.1. Employee shall not disclose to anyone, or use or
otherwise exploit during the Term and for a period of eighteen months
thereafter (or such longer period, if any, as Employee shall be receiving any
Termination Payment or Change in Control Payment (as each is hereinafter
defined)), for the benefit of anyone other than the Company, any confidential
business information, which shall be defined as data and information relating
to the business of the Company (whether constituting a trade secret or not)
which is or has been disclosed to Employee or of which Employee became aware
as a consequence of or through his relationship to the Company and which has
value to the Company and is not generally known to its competitors (the
"Confidential Information"). The Confidential Information shall include the
following (to the extent not generally known to competitors), (i) any trade
secrets, customer lists, details of client or consultant contracts, marketing
plans, product or service development plans, business acquisition plans of
the Company, or (ii) any portion or phase of any technical information,
ideas, "know-how", discoveries, product designs, computer programs (including
source or object codes), processes, procedures, formulae or improvements of
the Company, and whether or not in written or tangible form, and including
all memoranda, notes, plans, reports, records, documents and other evidence
thereof.
5.1.2. The foregoing notwithstanding, the term
"Confidential Information" does not include, and there shall be no obligation
hereunder with respect to, (i) information that becomes generally available
to the public other than as a result of a disclosure by Employee, and (ii)
business methods applicable to businesses generally. Employee shall not have
any obligation hereunder to keep confidential any Confidential Information if
and to the extent disclosure of any thereof is required by law. Employee
shall provide the Company with prompt notice of such requirement, prior to
making any disclosure, so that the Company may seek an appropriate protective
or restrictive order.
5.1.3. At the request of the Company, Employee agrees to
deliver to the Company, at any time during the Term or upon or after the
termination thereof, all Confidential Information which he may possess or
control. Employee agrees that all Confidential Information of the Company
discovered or made by him during the term of employment hereunder belongs to
the Company, and Employee hereby assigns and transfers to the Company all
such Confidential Information.
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5.2 NONCOMPETITION. Employee acknowledges that, as a result of
his executive position with the Company and his involvement daily in all of
the financial aspects of its business, it would be impossible for him to work
for a competitor of the Company without making use of Confidential
Information in a manner which would be damaging to the Company. Therefore,
for a period of twelve months after the termination of his employment with
the Company (or such longer period, if any, as Employee shall be receiving
any Termination Payment or Change in Control Payment), and so long as the
Company is not in default of any Termination Payments or Change in Control
Payments during such period, Employee shall not, directly or indirectly, be
employed by, or act as consultant or lender to, or be a director, officer,
employer, owner, or partner of, any business or organization which develops,
designs, engineers or manufactures sheet metal automotive components and
subassemblies, including tailgates, fenders, doors, roofs and hoods
(collectively, the "Products"). Employee shall not be restricted from
serving in any capacity of any company that does not manufacture, distribute
or sell Products. The provisions of this Section 5.2 will not be deemed
breached merely because Employee owns not more than 1% of the outstanding
common stock of a corporation, if, at the time of its acquisition by
Employee, such stock is listed on a national securities exchange, is reported
on NASDAQ, or is regularly traded in the over-the-counter market by a member
of a national securities exchange.
5.3 NONSOLICITATION OF EMPLOYEES. For a period of eighteen
months after the termination of his employment with the Company (or such
longer period, if any, as Employee in receiving any Termination Payment or
Change in Control Payment), Employee shall not, directly or indirectly, on
Employee's own behalf or on behalf of any other person, entity or enterprise,
employ, attempt to employ or assist anyone else in employing in as a manager,
executive, engineer, designer or salesperson in any competing business, any
of the Company's managerial, executive, engineering, design or sales
personnel.
5.4 NONSOLICITATION OF CUSTOMERS. For a period of eighteen
months after the termination of this Agreement (or such longer period, if
any, as Employee in receiving any Termination Payment or Change in Control
Payment), Employee shall not, directly or indirectly, on Employee's own
behalf or on behalf of any other person, entity or enterprise, solicit,
contact, call upon, communicate with or attempt to communicate with any
customer or prospect of Employer with a view to the sale or provision of any
product or service competitive or potentially competitive with the Products
or any other products or services manufactured, sold or provided by the
Company during the period of two years immediately preceding the cessation of
Employee's employment with the Company, provided that the restrictions set
forth in this Section shall apply only to customers or prospects of the
Company, or representatives of customers or prospects of the Company, with
which Employee had any contact during such two-year period prior to the
termination of this Agreement. The actions prohibited by this Section 5.4
shall not be engaged in by Employee directly or indirectly, whether as an
executive, financial officer, manager, salesman, agent, consultant, sales or
service representative, or otherwise. Nothing in this provision shall
prohibit employment of Employee by a customer or supplier of the Company.
5.5 RETURN OF PAYMENTS. In the event that Employee breaches any
provision of this Article 5, Employee agrees to return, within five business
days of the date on which such provision was breached, all Payments made by
the Company and further agrees to forfeit any future Payments he may have
been entitled to receive. The foregoing shall be in addition to, and not in
10.2-4
substitution for, any other remedies available to the Company at law or in
equity. The term "Payments" as used herein shall mean any Termination
Payment or any Change in Control Payment.
ARTICLE 6
TERMINATION OF EMPLOYMENT
6.1. WITH OR WITHOUT CAUSE. The Company may, at the Company's
sole option, terminate this Agreement with or without Cause by giving written
notice of the termination to Employee. "Cause" for purposes hereof means (i)
fraud, misappropriation or embezzlement involving property of the Company and
its affiliated companies or other intentional wrongful acts or any
intentional wrongful failures to act that may materially impair the goodwill
or business of the Company and its affiliated companies or that may cause
material damage to their property, goodwill or business, (ii) commission by
Employee of a felony, (iii) gross negligence, or (iv) refusal or inability to
perform or neglect of duty or duties.
6.2. COMPENSATION ON TERMINATION. In the event of the
termination of this Agreement by the Company for Cause, or, in the event of
the death or disability of Employee, Employee or his Estate shall receive
solely his Base Salary and benefits through the date of termination. In the
event of the termination of this Agreement by the Company without Cause prior
to the completion of the Term, or if upon expiration of this Agreement, the
Company does not offer to renew this Agreement on terms that are at least
equal to those then in effect, then Employee shall be entitled to the
compensation (Article 3) and benefits (Article 4) earned by him prior to the
date of termination as provided for in this Agreement, plus the greater of
(a) his Base Salary for the balance of the Term or (b) an amount equal to one
year of Base Salary (the "Termination Payment"). The Termination Payment
shall be made in equal installments in the same amount and at the same
periodic intervals as if Employee had remained employed by the Company. In
addition to the Termination Payment or the Change in Control Payment,
Employee's medical, life and disability insurance payments shall continue to
be made by the Company for a period of twelve months from the date of
termination; PROVIDED, HOWEVER, that if Employee commences employment with
another employer prior to the end of such twelve-month period, then the
Company shall not pay for such benefits from and after the date that such
benefits are paid for by Employee's new employer.
6.3. CHANGE IN CONTROL. In the event of a change in control (as
defined below), Employee shall have the option at any time after the date
that the change in control occurs to terminate his employment. Under such a
change in control termination, the Employee will receive from the Company
compensation in an amount equal to 2.99 times the Base Salary, less any Base
Salary paid to him from the date of the change in control to the date of
termination (the "CHANGE IN CONTROL PAYMENT"). Employee shall have the
option to receive the Change in Control Payment in (i) equal installments in
the same amount and at the same periodic intervals as if Employee had
remained employed by the Company or (ii) in a single lump sum payment. If
Employee elects to receive the Change in Control Payment in installments,
Employee may at any time within one year after termination elect to receive
the balance of the Change in Control Payment in a lump sum. A change in
control shall mean (i) the occurrence of any event resulting in Great Dane
Holdings Inc. ("GDHI") owning less than 51% of the outstanding shares of
common stock of the Company, or (ii) a change in control of GDHI whereby the
10.2-5
current five owners of GDHI (or their estates, heirs or family members)
individually or collectively beneficially own less than 50% of the
outstanding shares of GDHI.
ARTICLE 7
GENERAL PROVISIONS
7.1. REMEDIES. Employee acknowledges that the covenants to be
provided under Article 5 are unique and that their loss would cause
irreparable injury to the Company. Employee covenants and agrees with the
Company that money damages for any breach thereof will be an inadequate
remedy and that, therefore, the Company shall be entitled to specific
performance, injunctive and/or any other mode of equitable relief to enforce
its rights thereunder and, in any such case, no bond or other security shall
be required in connection therewith. If any restriction contained in Article
5 shall be deemed invalid, illegal, or unenforceable by reason of extent,
duration, or geographical scope or other provisions thereof, then the court
making such determination shall have the right to reduce such extent,
duration, or geographical scope thereof, or otherwise, and in its reduced
form such restriction shall then be unenforceable in the manner contemplated
hereby.
7.2. NOTICES. Any notices to be given under this Agreement by
either party to the other may be effected in writing either by personal
delivery or by certified mail. Mailed notices shall be addressed to the
parties at the addresses appearing in the introductory paragraph of this
Agreement (in the case of the Company c/o President, with a copy to Great
Dane Holdings Inc., 2016 North Pitcher Street, Kalamazoo, Michigan 49007,
Attn: President), but each party may change the address by written notice in
accordance with this paragraph. Notices delivered personally shall be
communicated as of actual receipt; mailed notices shall be deemed
communicated as of two days after mailing.
7.3. ENTIRE AGREEMENT. This Agreement supersedes any and all
other agreements, whether oral or in writing, between the parties with
respect to the employment of Employee by the Company, and this Agreement
contains all of the covenants and agreements between the parties with respect
to the employment in any manner whatsoever. Each party to this Agreement
acknowledges that no representations inducements, promises or agreement,
orally or otherwise, have been made by any party, or anyone acting on behalf
of any party, that are not embodied in this Agreement, and that no other
agreement, statement, or promise not contained in this Agreement shall be
valid or binding. Any modification of this Agreement will be effective only
if it is in writing signed by the party to be charged.
7.4. SURVIVAL. The covenants, agreements, representations, and
warranties contained in or made pursuant to this Agreement shall survive
Employee's termination of employment, irrespective of any investigation made
by or on behalf of any party.
7.5. WAIVER. Any waiver by either party of a breach of any
provision of this Agreement shall not operate as or be construed to be a
waiver of any other breach of such provision or of any breach of any other
provision of this Agreement. The failure of a party to insist upon strict
adherence to any term of this Agreement on one or more occasions shall not be
considered a waiver or deprive that party of the right thereafter to insist
10.2-6
upon strict adherence to that term or any other term of this Agreement. Any
waiver must be in writing.
7.6. BINDING EFFECT. Employee's rights and obligations under
this Agreement shall not be transferable by assignment or otherwise, such
rights shall not be subject to commutation, encumbrance, or the claims of
Employee's creditors, and any attempt to do any of the foregoing shall be
void. The provisions of this Agreement shall be binding upon and inure to
the benefit of Employee and his heirs and personal representatives, and shall
be binding upon and inure to the benefit of the Company and its successors
and assigns.
7.7. NO THIRD PARTY BENEFICIARIES.
This Agreement does not create, and shall not be construed as
creating, any rights enforceable by any person not a party to this Agreement
(except as provided in Section 7.6).
7.8. COUNTERPARTS; GOVERNING LAW. This Agreement may be executed
in any number of counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument. It shall
be governed by and construed in accordance with the laws of the State of New
York, without giving effect to conflict of laws.
7.9. SEPARABILITY. If any provision of this Agreement is
invalid, illegal, or unenforceable, the balance of this Agreement shall
remain in effect, and if any provision is inapplicable to any person or
circumstance, it shall nevertheless remain applicable to all other persons
and circumstances.
7.10. HEADINGS. The headings in this Agreement are solely for the
convenience of reference and shall be given no effect in the construction or
interpretation of this Agreement.
CMC KALAMAZOO INC.
By: /s/ David R. Markin
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Name: David R. Markin
Title: President and Chief Executive
Officer
/s/ Larry D. Temple
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Larry D. Temple