Agreement
Effective as of the first day of January, 1996
by and between
The Coleman Company, Inc.
a Delaware corporation
with its principal place of business at
1526 Cole Boulevard - Suite 300
Golden, Colorado
(the "Corporation")
and
Patrick McEvoy
(the "Executive")
WITNESSETH
Whereas, the Corporation and the Executive
mutually desire to enter into this Agreement
with respect to the Executive's employment
with the Corporation.
Now, therefore, in consideration of the mutual
covenants herein contained, the Corporation
and the Executive agree as follows:
1. EMPLOYMENT AND TERM. The Corporation agrees to employ the Executive
and the Executive agrees to serve the Corporation as a senior executive officer
for a term beginning on January 1, 1996 and ending on December 31, 1997, unless
sooner terminated in accordance with Section 5 hereof; PROVIDED, that commencing
on January 1, 1997 and each January 1 thereafter, the term of this Agreement
will automatically be extended for one additional year unless, not later than
June 30 of the preceding year, the Corporation or the Executive will have given
written notice to the other party not to extend this Agreement (such notice of
nonrenewal given by the Corporation to the Executive being hereinafter referred
to as a "Nonrenewal"); and FURTHER, PROVIDED, that if a Change in Control (as
defined in Section 8 hereof) occurs
during the term of this Agreement (including any extensions thereto), this
Agreement will continue in effect for a period of not less than two (2) years
beyond the month in which such Change in Control occurs.
2. DUTIES. The Executive agrees to serve the Corporation faithfully and
to the best of his ability; to devote his entire time, energy and skill during
regular business hours to such employment; and to use his best efforts, skill
and ability to promote its interest.
3. RESPONSIBILITIES; PLACE OF PERFORMANCE.
(a) During the term of this Agreement, the Executive shall have such
title and perform such duties as from time to time may be assigned to him by
the Board of Directors of the Corporation (the "Board") or any superior officer
of the Corporation; PROVIDED, that the title and the duties assigned to the
Executive shall not be inconsistent with his status as a senior executive
officer of the Corporation. The Executive shall at all times have executive
powers and authority as shall reasonably be required to enable him to discharge
his duties in an efficient manner, together with such facilities and services as
are suitable or customary to his position.
(b) Except for occasional travel on the Corporation's business, the
Executive will be required to perform his duties under this Agreement in the
Chicago, Illinois metropolitan area or in such other geographic location (within
the contiguous United States of America) as the Corporation may determine, so
long as the Corporation provides the Executive with relocation benefits no less
favorable than the relocation benefits available under the Corporation's
executive relocation policy as in effect for the 1995 relocation of the
Corporation's executive offices to the Denver, Colorado metropolitan area.
4. COMPENSATION AND RELATED MATTERS.
(a) SALARY. During the term of the Executive's employment hereunder,
the Corporation will pay to the Executive a salary at the rate of $200,000 per
annum, in substantially equal installments in accordance with normal payroll
practices of the Corporation, but not less frequently than monthly. The base
salary may
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be increased by the Board from time to time, in its discretion, but in no event
shall such base salary be reduced from the rate previously in effect. The base
salary in effect from time to time hereunder is referred to as the "Base
Salary."
(b) EXPENSES. The Executive will be entitled to receive prompt
reimbursement from the Corporation of all reasonable expenses incurred by the
Executive in performing services hereunder during the term of the Executive's
employment hereunder, including all expenses of travel and living expenses while
away from home on business or at the request of the Corporation, consistent with
expense policies applicable to other senior executive officers. The Executive
will furnish the Corporation with evidence that such expenses were incurred as
the Corporation may from time to time reasonably request.
(c) INCENTIVE BONUS. With respect to each calendar year during the
Term, the Executive will be granted an annual target incentive bonus opportunity
(the "Target Bonus") equal to no less than 70% of Base Salary. Payments of the
Executive's annual incentive bonus shall be made in accordance with the terms
and conditions set forth in the then current incentive bonus plan or arrangement
maintained by the Corporation (the "Incentive Plan"). The Target Bonus may be
increased from time to time, but may not be decreased below the percentage of
Base Salary previously in effect unless an adjustment is made in the Executive's
Base Salary such that the aggregate dollar amount of the Executive's Base Salary
and Target Bonus (after giving effect to the foregoing adjustments) is no less
than the aggregate dollar amount of such Base Salary and Target Bonus
(immediately prior to such adjustments).
(d) EMPLOYEE BENEFITS. The Executive will be entitled to participate
in all of the other employee benefit plans, programs and arrangements which are
presently or may hereafter be provided by the Corporation to its senior
executive officers including, without limitation, all retirement, health
insurance and life insurance plans, programs and arrangements (the "Benefit
Plans"), on a basis no less favorable than that of other senior executive
officers of the Corporation. In addition, the Executive will be entitled to
participate in all nonqualified employee pension plans or arrangements of the
Corporation in which he is currently or subsequently designated as a participant
(the "Pen-
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sion Plans"). The Corporation agrees that it will not terminate Executive's
participation in any of the Pension Plans or amend any of the Pension Plans in
any manner adverse to the Executive without the Executive's prior written
consent.
(e) VACATIONS. The Executive will be entitled to four (4) weeks of
vacation each calendar year, in accordance with the Corporation's vacation
policy as in effect from time to time. Vacation time which has not been used by
the end of each calendar year will be forfeited.
(f) CORPORATION AUTOMOBILE. The Corporation will provide the
Executive with an automobile during the term of this Agreement. The Corporation
will pay all reasonable expenses associated with the operation of such
automobile in the same manner as is in effect from time to time with respect to
other senior executive officers of the Corporation, including, without
limitation, all reasonable maintenance and insurance expenses. The automobile
furnished by the Corporation will be a late model top-of-the-line Oldsmobile or
like vehicle to be selected by the Executive. At the expiration of the term of
this Agreement, the Executive will promptly return the automobile to the
Corporation.
(g) OTHER. The Corporation will pay or promptly reimburse the
Executive for reasonable costs incurred by him in connection with his engagement
of professional estate planning and income tax assistance; PROVIDED, that such
amounts will not exceed $3,000 with respect to any calendar year.
5. TERMINATION.
(a) DEATH. The Executive's employment hereunder will terminate upon
his death.
(b) DISABILITY. The Executive's employment hereunder will terminate
upon his Disability. For purposes of this Agreement, the Executive will be
considered "Disabled" when eligible for benefits under the Corporation's long-
term disability plan as in effect from time to time (the "Disability Plan").
(c) CAUSE. The Executive's employment hereunder may be terminated for
Cause, as provided below. "Cause" means (i) the willful and continued failure
by the Executive to substantially
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perform the Executive's duties with the Corporation (other than any such failure
resulting from the Executive's incapacity due to physical or mental illness) or
(ii) the willful engaging by the Executive in conduct which is demonstrably and
materially injurious to the Corporation, monetarily or otherwise. For purposes
of the preceding sentence, no act, or failure to act, on the Executive's part
will be deemed "willful" unless done, or omitted to be done, by the Executive
not in good faith and without reasonable belief that the Executive's act, or
failure to act, was in the best interest of the Corporation. Upon the
Corporation's determination that Cause for the Executive's termination exists,
the Corporation may elect to terminate this Agreement upon sixty (60) days'
prior written notice to the Executive.
(d) GOOD REASON. The Executive may voluntarily terminate his
employment with the Corporation for Good Reason. Good Reason will exist upon
(i) the occurrence of any material breach of this Agreement on the part of the
Corporation (including, but not limited to, any breach of Section 3 or 4
hereof), (ii) the delivery to the Executive of a notice of Nonrenewal by the
Corporation; PROVIDED, that the Executive delivers a Notice of Termination
within sixty (60) days of the delivery of such notice of Nonrenewal, or (iii)
after the occurrence of a Change in Control, (1) a substantial adverse
alteration in the Executive's title or in the nature or status of the
Executive's responsibilities from those in effect immediately prior to such
Change in Control or (2) any change to the manner in which the Incentive Plan is
administered (including, but not limited to, the process utilized in setting
performance goals and the relative difficulty of achieving such goals), compared
to the manner in which the Incentive Plan was administered immediately prior to
the Change in Control, which change results in a significantly greater
likelihood that the Executive will be unable to earn the Target Bonus.
The Executive's right to terminate the Executive's employment for
Good Reason will not be affected by the Executive's incapacity due to physical
or mental illness. Except as provided above, the Executive's continued
employment will not constitute consent to, or a waiver of rights with respect
to, any act or failure to act constituting Good Reason hereunder.
(e) RESIGNATION. The Executive may voluntarily terminate his
employment hereunder at any time.
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(f) TERMINATION BY THE CORPORATION WITHOUT CAUSE. The Corporation
may terminate the Executive's employment hereunder without Cause at any time.
(g) NOTICE OF TERMINATION. Any termination of the Executive's
employment by the Corporation or by the Executive (other than termination
pursuant to Section 5(a) hereof) must be communicated by written Notice of
Termination to other party hereto. For purposes of this Agreement, a "Notice of
Termination" will mean a notice that indicates the specific termination
provision in this Agreement relied upon and sets forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of the
Executive's employment under the provision so indicated.
(h) DATE OF TERMINATION. "Date of Termination" will mean (i) if the
Executive's employment is terminated by his death, the date of his death, (ii)
if the Executive delivers a Notice of Termination within sixty (60) days of
delivery to the Executive of a notice of Nonrenewal from the Corporation, the
date of delivery of such Notice of Termination, and (iii) if the Executive's
employment is terminated for any other reason, the date specified in the Notice
of Termination.
6. COMPENSATION UPON TERMINATION
(a) FOR CAUSE; OTHER THAN FOR GOOD REASON. In the event that the
Executive's employment is terminated by the Corporation for Cause or by the
Executive other than for Good Reason, the Corporation will pay the Executive his
Base Salary through the Date of Termination. In addition, the Executive will be
entitled to receive all accrued benefits to which the Executive is entitled
under the Benefit Plans, in accordance with the terms of such Benefit Plans.
The Executive will not be entitled to any portion of the incentive bonus in
respect of the calendar year in which occurs the Date of Termination; PROVIDED,
that if the Date of Termination occurs after the end of a calendar year and
prior to the determination of whether the Executive is entitled to an incentive
bonus for such year, such incentive bonus will be paid, if and to the extent so
determined.
(b) DEATH; DISABILITY. In the event that the Executive's employment
is terminated by reason of the Executive's death
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or Disability, the Corporation will pay the Executive (or his estate or
beneficiary if applicable) his Base Salary through the Date of Termination. The
Executive (or his estate or beneficiary, if applicable) will be entitled to
receive all accrued benefits to which the Executive is entitled under the
Benefit Plans, in accordance with the terms of such Benefit Plans. The
Executive (or his estate or beneficiary, if applicable) will be entitled to
receive (i) in a lump sum as soon as practicable after the Date of Termination,
any incentive bonus accrued but not yet paid to the Executive, including for
this purpose any accumulated but unpaid excess amounts under the Incentive Plan
in respect of all calendar years ending prior to the Date of Termination, plus
(ii) a pro rata portion of the incentive bonus for the year in which occurs the
Date of Termination, such incentive bonus (A) to be calculated in accordance
with the terms of the Incentive Plan based on the actual results of the
Corporation for such year and then multiplied by a fraction the numerator of
which is the number of full and partial months worked by the Executive in such
calendar year and the denominator of which is twelve (12) and (B) to be payable
at the same time as incentive bonuses are paid to other participants in the
Incentive Plan for such year. If the Date of Termination occurs after the end
of a calendar year and prior to the determination of whether the Executive is
entitled to an incentive bonus for such year, such incentive bonus will be paid,
if and to the extent so determined, at the same time as incentive bonuses are
paid to other participants in the Incentive Plan for such year. If such
termination of employment is for reason of Disability, the Executive will also
be entitled to receive disability benefits, whether or not then covered by the
Disability Plan, comprised of monthly salary continuation payments, in an amount
calculated at two-thirds of Base Salary, for a period of time ending no sooner
than the earlier of the Executive's attaining age 65 or his death; PROVIDED,
that any such payments will be offset by (i) any payments made to the Executive
under the Disability Plan and (ii) any disability benefits payable under Social
Security.
(c) WITHOUT CAUSE OR DISABILITY; GOOD REASON. In the event that the
Executive's employment is terminated by the Corporation for any reason other
than for Cause or for Disability, or is terminated by the Executive for Good
Reason, then:
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(1) The Corporation will pay to the Executive, in a lump sum on
the fifth day following the Date of Termination (i) any Base
Salary due the Executive through the Date of Termination, plus
(ii) any incentive bonus accrued but not yet paid to the
Executive under the Incentive Plan for all calendar years ending
prior to the Date of Termination, including for this purpose any
accumulated but unpaid excess amounts under the Incentive Plan;
PROVIDED, that if the Date of Termination occurs prior to the
determination of whether the Executive is entitled to an
incentive bonus for any such year, such incentive bonus will be
paid, if and to the extent so determined, at the same time as
incentive bonuses are paid to other participants in the Incentive
Plan for such year.
(2) The Corporation will pay to the Executive an amount equal to
a pro rata portion of the incentive bonus for the year in which
occurs the Date of Termination, such incentive bonus (A) to be
calculated in accordance with the terms of the Incentive Plan
based on the actual results of the Corporation and then
multiplied by a fraction the numerator of which is the number of
full and partial months worked by the Executive in such calendar
year and the denominator of which is twelve (12) and (B) to be
payable at the same time as incentive bonuses are paid to other
participants in the Incentive Plan for such year.
(3) The Corporation will pay to the Executive compensation
continuation payments, payable on a monthly basis for a period of
two years immediately following the Date of Termination, equal to
one-twelfth (1/12) of the sum of the Executive's Base Salary and
Target Bonus (each as in effect immediately prior to the Date of
Termination, without regard to any reductions thereto giving rise
to Good Reason); PROVIDED, that during the second year of such
compensation continuation, payments will be offset by any and all
salary and bonus amounts paid to or accrued in respect of the
Executive for ser-
8
vices rendered to any other employer. The Executive will
promptly notify the Corporation of the receipt or accrual of any
such salary or bonus. The Corporation and the Executive agree
that the Executive is expected to seek employment in order to
attempt to offset payments provided under this Section 6(c)(3)
during the second year of compensation continuation but that the
Executive will not be required to accept any particular position
of employment.
(4) The Corporation will allow the Executive to continue to
participate, for two (2) years beginning as of the Date of
Termination, in any and all of the welfare benefit plans
maintained by the Corporation in which the Executive was entitled
to participate immediately prior to such Date of Termination, to
the same extent and upon the same terms as the Executive
participated in such plans prior to the Date of Termination;
PROVIDED, that the Executive's continued participation is
permissible or otherwise practicable under the general terms and
provisions of such plans. To the extent that continued
participation is neither permissible nor practicable, the
Corporation shall take such action as may be necessary to provide
the Executive with substantially comparable benefits (without
additional cost to the Executive) outside the scope of such plan.
If the Executive engages in regular employment after his
termination of employment (whether as an executive or as a
self-employed person), any employee welfare benefits received by
the Executive in consideration of such employment which are
similar in nature to the employee welfare benefits provided by the
Corporation will relieve the Corporation of its obligation under
this Section 6(c)(4) to provide comparable benefits to the extent
of the benefits so received. The Executive will promptly notify
the Corporation of his receipt of any such benefits.
(5) The Corporation will pay or promptly reimburse the Executive
for all reasonable expenses incurred
9
by him for professional outplacement services for a period of one
year (the "Outplacement Payment"); PROVIDED, that the
Outplacement Payment does not exceed in the aggregate $25,000,
and will pay an additional amount to reimburse the Executive for
any federal, state and local income taxes imposed on the
Executive by virtue of the Outplacement Payment and the
additional payment hereunder, such that the net amount retained
by the Executive, after deduction of any such taxes on the
Outplacement Payment and any such taxes on any additional payment
provided by this Section 6(c)(5), shall be equal to the
Outplacement Payment.
(6) Any and all stock options granted to the Executive under the
stock option plans of the Corporation (the "Option Plans") will
be treated as follows: (i) each stock option originally granted
with a term of five and one-half years or less under any Option
Plan will become immediately and fully vested as of the Date of
Termination, and (ii) each stock option originally granted with a
term of more than five and one-half years under any Option Plan
will become vested as of the Date of Termination on the basis of
the following vesting schedule, if more favorable than the
vesting schedule otherwise applicable to such stock option: the
number of shares of Corporation common stock subject to each such
stock option multiplied by the percentage obtained by multiplying
1.67% by the number of full and partial months of the Executive's
service during the term of such stock option through and
including the Date of Termination. The vested portion of stock
options under this Section 6(c)(6) shall remain exercisable for a
period of ninety (90) days after the Date of Termination (but not
beyond its normal expiration date). Any portion of any stock
option which does not vest under this Section 6(c)(6) (or under
the vesting schedule otherwise applicable to such stock option)
shall be forfeited as of the Date of Termination.
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(7) All accrued benefits of the Executive under the Pension
Plans will immediately vest as of the Date of Termination.
7. EXCISE TAX.
(a) In the event that any payment or benefit received or to be
received by the Executive in connection with a Change in Control or the
termination of the Executive's employment (whether pursuant to the terms of this
Agreement or any other plan, arrangement or agreement with the Corporation, any
person whose actions result in a Change in Control or any person affiliated with
the Corporation or such person) (all such payments and benefits being
hereinafter called "Total Payments") will be subject (in whole or part) to the
excise tax (the "Excise Tax") imposed under Section 4999 of the Internal Revenue
Code of 1986, as amended (the "Code"), then, subject to the provisions of
Section (7)(b) hereof, the Corporation will pay to the Executive an additional
amount (the "Gross-Up Payment") such that the net amount retained by the
Executive, after deduction of any Excise Tax on the Total Payments and any
federal, state and local income tax and Excise Tax upon the payment provided for
by this Section 7, will be equal to the Total Payments. For purposes of
determining the amount of the Gross-Up Payment, the Executive will be deemed to
pay federal income taxes at the highest marginal rate of federal income taxation
in the calendar year in which the Gross-Up Payment is to be made and state and
local income taxes at the highest marginal rate of taxation in the state and
locality of the Executive's residence on such date, net of the maximum reduction
in federal income taxes which could be obtained from deduction of such state and
local taxes.
(b) In the event that, after giving effect to any redeterminations
described in Section 7(d) hereof, a reduction in the Total Payments to the
largest amount that would result in no portion of the Total Payments being
subject to the Excise Tax (after taking into account any reduction in the Total
Payments provided by reason of Section 280G of the Code in such other plan,
arrangement or agreement) would produce a net amount (after deduction of the net
amount of federal, state and local income tax on such reduced Total Payments)
that would be greater than the net amount of unreduced Total Payments (after
deduction of the net amount of federal, state and local income tax and the
amount of
11
Excise Tax to which the Executive would be subject in respect of such Total
Payments), then Section 7(a) hereof will not apply and the Total Payments will
be so reduced.
(c) For purposes of determining whether any of the Total Payments
will be subject to the Excise Tax and the amount of such Excise Tax, (i) all of
the Total Payments will be treated as "parachute payments" within the meaning of
Section 280G(b)(2) of the Code, unless in the opinion of tax counsel selected by
the Corporation's independent auditors and reasonably acceptable to the
Executive ("Tax Counsel"), such other payments or benefits (in whole or in part)
do not constitute parachute payments, including by reason of Section
280G(b)(4)(A) of the Code, (ii) all "excess parachute payments" within the
meaning of Section 280G(b)(l) of the Code will be treated as subject to the
Excise Tax, unless in the opinion of Tax Counsel such excess parachute payments
(in whole or in part) represent reasonable compensation for services actually
rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in excess of
the base amount (as defined in Section 280G(b)(3) of the Code) allocable to such
reasonable compensation, or are otherwise not subject to the Excise Tax, and
(iii) the value of any noncash benefits or any deferred payment or benefit will
be determined by the Corporation's independent auditors in accordance with the
principles of Sections 280G(d)(3) and (4) of the Code. The Corporation will
provide the Executive with its calculation of the amounts referred to in this
Section 7 and such supporting materials as are reasonably necessary for the
Executive to evaluate the Corporation's calculations. If the Executive disputes
the Corporation's calculations (in whole or in part), the reasonable opinion of
Tax Counsel with respect to the matter in dispute will prevail.
(d) In the event that (i) the Excise Tax is subsequently determined
to be less than the amount taken into account hereunder at the time of payment
of the Total Payments and (ii) after giving effect to such redetermination, the
Total Payments are reduced pursuant to Section 7(b) hereof, the Executive will
repay to the Corporation, at the time that the amount of such reduction in
Excise Tax is finally determined, the portion of the Gross-Up Payment
attributable to such reduction (plus that portion of the Gross-Up Payment
attributable to the Excise Tax and federal, state and local income tax imposed
on the Gross-Up Payment being repaid by the Executive to the extent that such
repayment
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results in a reduction in the Excise Tax and/or a federal, state or local income
tax deduction) plus interest on the amount of such repayment at the rate
provided in Section 1274(b)(2)(B) of the Code. In the event that (x) the Excise
Tax is determined to exceed the amount taken into account hereunder at the time
of the termination of the Executive's employment (including by reason of any
payment the existence or amount of which cannot be determined at the time of the
Gross-Up Payment) and (y) after giving effect to such redetermination, the Total
Payments are not reduced pursuant to Section 7(b) hereof, the Corporation will
make an additional Gross-Up Payment in respect of such excess and in respect of
any portion of the Excise Tax with respect to which the Corporation had not
previously made a Gross-Up Payment (plus any interest, penalties or additions
payable by the Executive with respect to such excess and such portion) at the
time that the amount of such excess is finally determined.
8. CHANGE IN CONTROL. (a) For purposes of this Agreement, a Change
in Control will be deemed to have taken place upon the occurrence of any of the
following events:
(i) any "person" (as defined in Section 3(a)(9) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and as
modified in Sections 13(d) and 14(d) of the Exchange Act) other than (A)
the Corporation or any of its subsidiaries, (B) any employee benefit plan
of the Corporation or one of its subsidiaries, (C) MacAndrews & Forbes
Holdings Inc. or any affiliate thereof (collectively, "MAFCO"), (D) a
corporation owned, directly or indirectly, by stockholders of the
Corporation in substantially the same proportions as their ownership of the
Corporation, or (E) an underwriter temporarily holding securities pursuant
to an offering of such securities (a "Person"), becomes the "beneficial
owner" (as defined in Rule 13d-3 of the Exchange Act), directly or
indirectly, of securities of the Corporation representing 20% or more of
the shares of common stock of the Corporation then outstanding, and such
Person's beneficial ownership level then exceeds the percentage of the
Corporation's outstanding shares beneficially owned by MAFCO;
(ii) the consummation of any merger or consolidation of the
Corporation or one of its subsidiaries with or into any other corporation,
other than a merger or consolida-
13
tion which would result in the holders of the voting securities of the
Corporation outstanding immediately prior thereto holding securities which
represent immediately after such merger or consolidation more than 80% of
the combined voting power of the voting securities of the Corporation or
the surviving corporation or the parent of such surviving corporation;
(iii) the stockholders of the Corporation approve a plan of
complete liquidation of the Corporation or an agreement for the sale or
disposition by the Corporation of all or substantially all of the
Corporation's assets; or
(iv) a majority of the Board votes in favor of a decision that a
Change in Control has occurred.
(b) Notwithstanding anything in Section 8(a) hereof to the contrary,
any event or transaction which would otherwise constitute a Change in Control (a
"Transaction") shall not constitute a Change in Control for purposes of this
Agreement if, in connection with the Transaction, the Executive participates as
an equity investor in the acquiring entity or any of its affiliates (the
"Acquiror"). For purposes of the preceding sentence, the Executive shall not be
deemed to have participated as an equity investor in the Acquiror by virtue of
(i) obtaining beneficial ownership of any equity interest in Acquiror as a
result of the grant to the Executive of incentive compensation awards under one
or more incentive plans of Acquiror, on terms and conditions substantially
equivalent to those applicable to other executives of the Corporation
immediately prior to the Transaction, after taking into account normal
differences attributable to job responsibilities, title and the like, or (ii)
obtaining beneficial ownership of any equity interest in Acquiror on terms and
conditions substantially equivalent to those obtained in the Transaction by all
other stockholders of the Corporation.
(c) Upon the occurrence of a Change in Control during the term of
this Agreement, whether or not the Executive's employment within the Corporation
is terminated in connection with such event, any and all stock options granted
to the Executive under the Option Plans will become immediately vested.
9. INVENTIONS; CONFIDENTIAL INFORMATION; COMPETITORS.
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(a) All inventions, whether or not patentable, conceived or developed
by Executive, alone or with others, during his employment by the Corporation
will be the property of the Corporation and will be promptly and fully disclosed
by Executive to the Corporation. Executive will perform all necessary acts to
vest title fully to any such invention in the Corporation and to enable the
Corporation, at its expense, to secure and maintain domestic and/or foreign
patents or any other rights for such inventions.
(b) Without the express prior written consent of the Corporation,
Executive will not disclose or make available to anyone outside the Corporation,
its subsidiaries, or affiliated corporations or entities any confidential or
proprietary information of, or concerning, the Corporation, including, without
limitation, trade secrets, know how, customer lists, inventions or other
information not generally known to any competitor of the Corporation, its
subsidiaries or affiliated corporations or entities. Upon termination of his
employment, Executive will promptly deliver to the Corporation all documents
containing any such confidential or proprietary information without retaining
any copies or extracts thereof.
(c) During the time he is employed by the Corporation or serves the
Corporation as a consultant, Executive will not serve as officer, director or
employee or be associated in any other capacity with any corporation,
partnership or other entity or person which is a competitor of the Corporation,
its subsidiaries, or affiliated corporations or entities. During such period
Executive will have no financial interest in any corporation, partnership or
other entity which is a competitor of the Corporation, its subsidiaries, or
affiliated corporations or entities, except participation solely as a
stockholder owning not more than 5% of the outstanding shares of a publicly
owned business.
(d) Executive acknowledges that his services are special, unique,
unusual and extraordinary, giving them peculiar value, the loss of which cannot
be reasonably or adequately compensated for by damages and, in the event of
Executive's breach of this Section 9, the Corporation will be entitled to
equitable relief by way of injunction or otherwise.
15
10. TERMINATION OF PRIOR AGREEMENTS. This Agreement expressly supersedes
all agreements and understandings between the parties with respect to
Executive's employment and any such agreement is hereby terminated as of the
date first above written.
11. BINDING EFFECT. This Agreement will be binding upon and inure to the
benefit of the parties hereto, their respective legal representatives and to any
successor of the Corporation, which successor will be deemed substituted for the
Corporation under the terms of this Agreement. As used in this Agreement, the
term "successor" will include any person, firm, corporation, or other business
entity which at any time, whether by merger, purchase or otherwise, acquires all
or substantially all of the assets or business of the Corporation.
12. WAIVER OF BREACH. The waiver by the Corporation of a breach of any
provision of this Agreement by the Executive will not operate or be construed as
a waiver of any subsequent breach.
13. NOTICES. Any notice required or permitted to be given will be
sufficient, if in writing, and if sent by registered or certified mail to the
Executive at his residence or to the Corporation at its principal place of
business.
14. ENTIRE AGREEMENT. This document contains the entire agreement of the
parties and may not be changed except in a written modification signed by both
parties.
15. INDEMNIFICATION. The Corporation will indemnify the Executive, to the
maximum extent permitted by applicable law, against all costs, charges and
expenses incurred or sustained by the Executive in connection with any action,
suit or proceeding to which the Executive may be made a party by reason of the
Executive being an officer, director or employee of the Corporation or of any
subsidiary or affiliate of the Corporation.
16. LEGAL FEES. The Corporation will pay or promptly reimburse the
Executive for the reasonable legal fees and expenses incurred by the Executive,
in good faith, in connection with enforcing or defending any right of the
Executive pursuant to this Agreement.
16
17. GOVERNING LAW. This Agreement will be governed by and construed in
accordance with the laws of the State of Colorado, as applied to contracts
executed and performed wholly within the State of Colorado.
18. SURVIVORSHIP. Any rights and obligations of the parties set forth in
Sections 4(d), 6, 7 and 9 of this Agreement will survive any termination of this
Agreement.
19. ARBITRATION. All disputes or controversies arising under or in
connection with this Agreement, including for this purpose any claims by the
Executive relating to any Pension Plan, will be settled exclusively by
arbitration, in Denver, Colorado in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered on the
arbitrator's award in any court having jurisdiction; PROVIDED, that the
Executive will be entitled to seek specific performance of the Executive's right
to be paid until the Date of Termination during the pendency of any dispute or
controversy arising under or in connection with this Agreement.
17
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
below.
THE COLEMAN COMPANY, INC.
By:/s/D K Stearns
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Date: 4/15/96
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/s/ Patrick McEvoy
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EXECUTIVE
Date: 4/15/96
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