Exhibit 10.38
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, dated as of the ______ day of ________,
1999, between REMINGTON ARMS COMPANY, INC., a Delaware corporation ("Employer"),
and _____________ ("Executive").
W I T N E S S E T H:
WHEREAS, Employer desires to secure the continued services of Executive
and Executive desires to continue to work for Employer, and, in connection
therewith, Employer and Executive desire to establish the terms and provisions
of the employment relationship through a written agreement ("Agreement").
NOW, THEREFORE, in consideration of the promises and mutual covenants
contained herein and for other good and valuable consideration, Employer and
Executive hereby agree as follows:
1. Agreement to Employ. Upon the terms and subject to the conditions of
this Agreement, Employer hereby employs Executive and Executive hereby accepts
employment by Employer.
2. Term; Position and Responsibilities. (a) Term of Employment.
Pursuant to the terms of this Agreement, Employer shall continue to employ
Executive for the term commencing on the date hereof and terminating as provided
in Section 7. The period during which Executive is employed pursuant to this
Agreement shall be referred to as the "Employment Period".
(b) Position and Responsibilities. During the Employment Period,
Executive will serve in the executive position specified in Section 1 of
Attachment A or in such other executive position as the Board may determine from
time to time. Executive shall have such duties and responsibilities as are
customarily assigned to individuals serving in the position to which he is
assigned, and such other duties consistent with Executive's position as the
Board of Directors of Employer ("Employer's Board"), Chairman, or President may
specify from time to time. Executive will devote all of his skill, knowledge and
working time to the conscientious performance of the duties of such position or
positions (except for (i) vacation time as set forth in Section 6(c) hereof and
absence for sickness or similar disability and (ii) to the extent that it does
not interfere with the performance of Executive's duties hereunder, (A) such
reasonable time as may be devoted to service on outside charitable boards of
directors and the fulfillment of civic responsibilities or to service on the
boards of such corporations as Executive is serving on the date hereof or which
he may hereafter join with the consent of Employer and (B) such reasonable time
as may be necessary from time to time for personal financial matters).
3. Base Salary. As compensation for the services to be performed by
Executive during the Employment Period, Employer will pay Executive the annual
base salary specified in Section 2 of Attachment A. Employer's Board will review
Executive's base
salary annually during the period of his employment hereunder and, in the
discretion of Employer's Board, may increase (but may not decrease) such base
salary from time to time based upon the performance of Executive, the financial
condition of Employer, prevailing industry salary levels and such other factors
as Employer's Board shall consider relevant. The annual base salary payable to
Executive under this Section 3, as the same may be increased from time to time
and without regard to any reduction therefrom in accordance with the next
sentence, shall hereinafter be referred to as the "Base Salary". The Base Salary
payable under this Section 3 shall be reduced to the extent that Executive
elects to defer such Base Salary under the terms of any deferred compensation,
savings plan or other voluntary deferral arrangement maintained or established
by Employer. The pay period under this agreement shall equal one month and
Employer shall pay Executive the Base Salary for each pay period in semi-monthly
installments or in such other installments as are paid to other executives of
Employer.
4. Annual Incentive Compensation. During the Employment Period,
Executive shall participate in Employer's incentive compensation programs for
its executive officers existing from time to time (the "Management Incentive
Compensation Plan"), at a targeted level specified in Section 3 of Attachment A
(the "Target Amount"), and commensurate with his position and duties with
Employer based on reasonable performance targets established from time to time
by Employer's Board of Directors or a committee thereof.
5. Employee Benefits. During the Employment Period, Executive shall be
eligible to participate in the employee benefit plans and programs generally
made available to similarly situated employees or executives of Employer, in a
manner consistent with the terms and conditions of each such plan or program and
on a basis that is commensurate with Executive's position and duties with
Employer hereunder.
6. Expenses. (a) Business Travel, Lodging, etc. Employer shall
reimburse Executive for reasonable travel, lodging, meal and other reasonable
expenses incurred by him in connection with his performance of services
hereunder upon submission of evidence, satisfactory to Employer, to support the
existence and purpose of the incurred expense and otherwise in accordance with
Employer's business travel reimbursement policy applicable to senior executives
as in effect from time to time.
(b) Vacation. Executive shall be entitled to vacation as determined in
accordance with the prevailing policies of Employer applicable to senior
executives.
7. Termination of Employment. (a) Termination Due to Death or
Disability. In the event that Executive's employment hereunder terminates due to
death or is terminated by Employer due to Executive's Disability (as defined
below), no termination benefits shall be payable to or in respect of Executive
except as provided in Section 7(f)(ii). For purposes of this Agreement,
"Disability" shall mean a physical or mental disability that prevents the
performance by Executive of his duties hereunder lasting for a continuous period
of six months or longer. The determination of Executive's Disability shall be
made by an independent physician selected by Employer and reasonably acceptable
to Executive and shall be final and binding.
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(b) Termination by Employer for Cause. Employer may terminate Executive
for "Cause". "Cause" shall mean (i) the willful failure of Executive
substantially to perform his duties hereunder (other than any such failure due
to physical or mental illness) or other material breach by Executive of any of
his obligations hereunder, after a demand for substantial performance or cure of
such breach is delivered, and a reasonable opportunity to cure is given, to
Executive by Employer, which demand identifies the manner in which Employer
believes that Executive has not substantially performed his duties or breached
his obligations, (ii) Executive's engaging in willful and serious misconduct
that has caused or would reasonably be expected to result in material injury to
Employer or any of its affiliates, (iii) Executive's conviction of, or entering
a plea of nolo contendere to, a crime that constitutes a felony, or (iv)
violation of any provision of Employer's business ethics policy.
(c) Termination Without Cause. A termination "Without Cause" shall mean
a termination of employment by Employer other than due to Disability as
described in Section 7(a) or for Cause as defined in Section 7(b). Upon delivery
of Notice of Termination, Employer may immediately remove Executive from his
executive position and Executive shall immediately resign from his executive
position.
(d) Termination by Executive. Executive may terminate his employment
for "Good Reason". Good Reason shall mean a termination of employment by
Executive within 30 days following the occurrence of any of the following events
without Executive's consent: (i) the assignment of Executive to a position the
duties of which are a material diminution of the duties contemplated by Section
2(b) hereof, (ii) a reduction of Executive's Base Salary or the percentage of
such Base Salary made available as an incentive compensation opportunity
pursuant to Section 4, (iii) the assignment of Executive to a principal office
located beyond a 50-mile radius of Executive's current work place, or (iv) a
material breach by Employer of any of its obligations hereunder. To effect a
termination for Good Reason, Executive must deliver a written Notice of
Termination stating his intention to terminate his employment for "Good Reason"
and specifying the specific provisions hereof on which Executive is relying.
Notwithstanding the foregoing, Executive may not terminate his employment for
Good Reason if Employer has, within 15 days of the receipt of Executive's
written Notice of Termination, cured the conduct alleged to give rise to the
basis for the Good Reason termination.
(e) Notice of Termination. Any termination by Employer pursuant to
Section 7(a), 7(b) or 7(c), or by Executive pursuant to Section 7(d), shall be
communicated by a written "Notice of Termination" addressed to the other parties
to this Agreement. A "Notice of Termination" shall mean a notice stating that
Executive's employment hereunder has been or will be terminated.
(f) Payments Upon Certain Terminations. (i) If Employer has provided
Executive Notice of Termination without Cause or Executive terminates his
employment for Good Reason, Employer shall pay to Executive as severance:
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(1) his Base Salary, for the period from such date of termination
through the expiration of the severance term specified in
Section 4 of Attachment A to this Agreement, and
(2) the product of
(i) the amount of incentive compensation that would have
been payable to Executive for the calendar year in
which his employment terminates if he had remained
employed for the entire calendar year and assuming
that all applicable performance objectives had been
achieved at target, multiplied by
(ii) a fraction, the numerator of which is equal to the
number of days in such calendar year that precede (x)
if a termination Without Cause, the date of the
Notice of Termination, or (y) if a termination by
Executive for Good Reason, the Date of Termination,
and the denominator of which is 365.
In consideration of such severance benefits, Employee agrees to (i) waive all
rights to post termination benefits, other than vested equity awards and
pension, if any, after the termination date, (ii) waive any claims to other
severance or termination benefits and (iii) execute a reasonable release
releasing Employer from all claims including but not limited to claims under the
Americans with Disabilities Act or for wrongful discrimination or wrongful
discharge from Employer. Employer may pay to Executive at any time a single lump
sum equal to the present value (calculated using a discount rate equal to the
short-term Applicable Federal Rate as defined in Section 1274(d) of the Internal
Revenue Code) of the remaining amount payable as Base Salary hereunder in full
and complete satisfaction of Employer's obligations under Section 7(f)(i).
Employer shall continue to provide to Executive the life, medical, dental,
accidental death and dismemberment and prescription drug benefits made available
to Executive pursuant to Section 5 (the "Continued Benefits") during the period
over which Employer continues to pay Executive his Base Salary pursuant to this
Section 7(f)(i). Executive shall generally not have a duty to mitigate the costs
to Employer under this Section 7(f)(i), except that (i) if the period over which
Employer continues to pay Executive his Base Salary pursuant to this Section
7(f)(i) extends beyond one year from the Date of Termination, the amount payable
pursuant to this Section 7(f)(i) as Base Salary for any period after the
expiration of such one year shall be reduced (but not below zero) by the amount
of compensation received by Executive for services performed in any capacity,
including self-employment, and (ii) Continued Benefits for such period shall be
reduced or canceled to the extent of any comparable benefit coverage offered to
Executive by a subsequent employer during the period the Continued Benefits are
to be provided.
(ii) Upon his death or Disability or if Employer shall terminate
Executive's employment for Cause, Employer shall pay Executive his full Base
Salary through the Date of Termination, plus, in the case of termination upon
Executive's death or Disability, the pro rata amount of incentive compensation
for the portion of the calendar year preceding Executive's Date of Termination
(exclusive of any time between the onset
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of a physical or mental disability that prevents the performance by Executive of
his duties hereunder and the resulting Date of Termination) that would have been
payable to Executive if he had remained employed for the entire calendar year
and assuming that all applicable performance targets had been achieved at target
levels of performance. Executive shall not be entitled to severance compensation
under any severance compensation plan of Employer when Executive receives
compensation under this Section 7(f)(ii). Other than severance compensation, any
benefits payable to or in respect of Executive under any otherwise applicable
plans, policies and practices of Employer shall not be limited by this
provision.
[(g) Pension Credited Service. If Employer has provided Executive
Notice of Termination without Cause or Executive terminates his employment for
Good Reason, Employer shall provide Executive with service credit for
determining the amount of any pension benefit payable to Executive under
Employer's applicable defined benefit pension plans as though Executive had
continued in the employ of Employer through the end of the Severance Term
specified in Section 4 of Attachment A hereto. To the extent that any benefit
which would be payable under any such plan in respect of such deemed service can
not be paid under the terms of such plan (the "Precluded Plan"), Employer shall
cause such benefit to be paid under another plan or shall pay any amounts
otherwise owing from its general assets, at the same time and under the same
circumstances and conditions as such amounts would have been payable under the
Precluded Plan. Additionally, average final pay for determining the amount of
any pension benefit payable to Executive under Employer's applicable defined
benefit pension plans shall not be affected by any payments made to Executive
during such Severance Term.] [For Messrs. Little and Millner only]
(h) Date of Termination. As used in this Agreement, the term "Date of
Termination" shall mean (i) if Executive's employment is terminated by his
death, the date of his death, (ii) if Executive's employment is terminated by
Employer for Cause, the date on which Notice of Termination is given or, if
later, the date of termination specified in such Notice, as contemplated by
Section 7(e), and (iii) if Executive's employment is terminated by Employer
Without Cause, due to Executive's Disability or by Executive for Good Reason, 30
days after the date on which Notice of Termination is given as contemplated by
Section 7(e) or, if no such Notice is given, the actual date of termination of
Executive's employment.
8. Unauthorized Disclosure. Without the prior written consent of
Employer's Board or its authorized representative, except to the extent required
by an order of a court having competent jurisdiction or under subpoena from an
appropriate government agency, in which event, Executive will use his best
efforts to consult with Employer's Chairman or President prior to responding to
any such order or subpoena, and except as required in the performance of his
duties hereunder, Executive shall not disclose any confidential or proprietary
trade secrets, customer lists, drawings, designs, information regarding product
development, marketing plans, sales plans, manufacturing plans, management
organization information (including data and other information relating to
members of Employer's Board, the Board of Directors of RACI Holding, Inc.
("Holding") and management of Employer or Holding), operating policies or
manuals,
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business plans, financial records, packaging design or other financial,
commercial, business or technical information relating to Holding, Employer or
any of their respective subsidiaries or affiliates or that Holding, Employer or
any of their respective subsidiaries or affiliates may receive belonging to
suppliers, customers or others who do business with Holding, Employer or any of
their respective subsidiaries or affiliates (collectively, "Confidential
Information") to any third person unless such Confidential Information has been
previously disclosed to the public or is in the public domain (other than by
reason of Executive's breach of this Section 8).
9. Non-Competition. During the period of Executive's employment and the
one year period following Executive's voluntary termination of employment other
than for Good Reason (such periods referred to collectively as the "Restriction
Period"), Executive shall not, directly or indirectly, engage in, become
employed by, serve as an agent or consultant to, or become a partner, principal
or stockholder (other than a holder of less than 1% of the outstanding voting
shares of any publicly held company) of any business or entity which is engaged
in the manufacture, sale, distribution or production of products related to
hunting and fishing which are competitive in any geographic area with any
products manufactured, sold, distributed or produced by Employer or any of its
subsidiaries. Executive agrees and acknowledges that Employer and its
subsidiaries are engaged in business and sell and distribute their products
throughout the United States and other jurisdictions throughout the world, and
that it would not be reasonable to limit the geographic scope of this covenant
to any particular geographic location.
10. Non-Solicitation of Employees. During the Restriction Period,
Executive shall not, directly or indirectly, for his own account or for the
account of any other person or entity with which he is or shall become
associated in any capacity, (a) solicit for employment, employ or otherwise
interfere with the relationship of Employer with any person who at any time
during the six months preceding such solicitation, employment or interference is
or was employed by or otherwise engaged to perform services for Employer other
than any such solicitation or employment during Executive's employment with
Employer on behalf of Employer, or (b) induce any employee of Employer who is a
member of management to engage in any activity which Executive is prohibited
from engaging in under any of Sections 8, 9, 10 or 11 hereof or to terminate his
employment with Employer.
11. Non-Solicitation of Customers. During the Restriction Period,
Executive shall not, directly or indirectly, solicit or otherwise attempt to
establish for himself or any other person, firm or entity (other than Employer
or its subsidiaries or affiliates) any business relationship of a nature that is
competitive with the business or relationship of Employer with any person, firm
or corporation which during the twelve-month period preceding the date his
employment with Employer terminated was a customer, client or distributor of
Employer or any of their respective subsidiaries.
12. Return of Documents. In the event of the termination of Executive's
employment for any reason, Executive will deliver to Employer all of Employer's
property and Employer's non-personal documents and data of any nature and in
whatever medium pertaining to Executive's employment with Employer, and he will
not take with
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him any such property, documents or data of any description or any reproduction
thereof, or any documents containing or pertaining to any Confidential
Information.
13. Injunctive Relief with Respect to Covenants. Executive acknowledges
and agrees that the covenants and obligations of Executive with respect to
non-competition, non-solicitation, confidentiality and Employer property relate
to special, unique and extraordinary matters and that a violation of any of the
terms of such covenants and obligations will cause Employer irreparable injury
for which adequate remedies are not available at law. Therefore, Executive
agrees that Employer shall be entitled to an injunction, restraining order or
such other equitable relief (without the requirement to post bond) as a court of
competent jurisdiction may deem necessary or appropriate to restrain Executive
from committing any violation of the covenants and obligations referred to in
this Section 13. These injunctive remedies are cumulative and in addition to any
other rights and remedies Employer may have at law or in equity. If Employer
does not prevail in obtaining any such injunctive relief, Employer shall
reimburse Executive for any legal expenses incurred by him in defending the
imposition of such injunctive relief.
14. Intellectual Property. During the term of this agreement, Executive
will disclose to Employer all ideas, inventions and business plans developed by
him during such period which relate directly or indirectly to the business of
Employer or any of its subsidiaries or affiliates, including without limitation,
any process, operation, product, or improvement which may be proprietary,
patentable or copyrightable. Executive agrees that such will be the property of
Employer and that he will at Employer's request and cost do whatever is
necessary to secure the rights thereto by patent, copyright or otherwise for
Employer.
15. Assumption of Agreement. Employer will require any successor (by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of Employer, by agreement in form and substance
reasonably satisfactory to Executive, to expressly assume and agree to perform
this Agreement in the same manner and to the same extent that Employer would be
required to perform it if no such succession had taken place. Failure of
Employer to obtain such agreement prior to the effectiveness of any such
succession shall be a breach of this Agreement and shall entitle Executive to
compensation from Employer in the same amount and on the same terms as Executive
would be entitled hereunder if Employer terminated his employment Without Cause
as contemplated by Section 7(c), except that for purposes of implementing the
foregoing, the date on which any such succession becomes effective shall be
deemed both the date of the Notice of Termination and the Date of Termination.
This Agreement shall bind Employer and any subsidiary, holding company, or
successor in interest of Employer.
16. Waiver of Certain Rights. Employer and Executive hereby acknowledge
and agree that any prior employment agreement or arrangement is superseded in
its entirety by the terms of this Agreement and the terms of any prior
employment agreement or arrangement shall, from and after the Effective Time, be
of no further force or effect.
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17. Entire Agreement. Except as otherwise expressly provided herein,
this Agreement (including the Attachment hereto) constitutes the entire
agreement among the parties hereto with respect to the subject matter hereof,
and all promises, representations, understandings, arrangements and prior
agreements relating to such subject matter (including, without limitation, those
made to or with Executive by any other person or entity and any prior agreement)
are merged herein and superseded hereby.
18. Indemnification. Employer agrees that it shall indemnify, defend,
and hold harmless Executive to the fullest extent permitted by Delaware law from
and against any and all liabilities, costs, claims and expenses including
without limitation all costs and expenses incurred in defense of litigation,
including attorneys' fees, arising out of the employment of Executive hereunder,
except to the extent arising out of or based upon the gross negligence or
willful misconduct of Executive. Costs and expenses incurred by Executive in
defense of litigation, including attorneys' fees, shall be paid by Employer in
advance of the final disposition of such litigation upon receipt of an
undertaking by or on behalf of Executive to repay such amount if it shall
ultimately be determined that Executive is not entitled to be indemnified by
Employer under this Agreement.
19. Miscellaneous. (a) Binding Effect. This Agreement shall be binding
on and inure to the benefit of Employer and its successors and permitted
assigns. This Agreement shall also be binding on and inure to the benefit of
Executive and his heirs, executors, administrators and legal representatives.
(b) Arbitration. Any dispute or controversy arising under or in
connection with this Agreement (except in connection with any request for
injunctive relief contemplated by Section 13) shall be resolved by binding
arbitration. The arbitration shall be held in the city of Greensboro, North
Carolina and except to the extent inconsistent with this Agreement, shall be
conducted in accordance with the Voluntary Labor Arbitration Rules of the
American Arbitration Association then in effect at the time of the arbitration,
and otherwise in accordance with principles which would be applied by a court of
law or equity. The arbitrator shall be acceptable to both Employer and
Executive. If the parties cannot agree on an acceptable arbitrator, the dispute
shall be heard by a panel of three arbitrators, one appointed by each of the
parties and the third appointed by the other two arbitrators. All expenses of
arbitration shall be borne by the party who incurs the expense, or, in the case
of joint expenses, by both parties in equal portions, except that, in the event
Executive prevails on the principal issues of such dispute or controversy, all
such expenses shall be borne by Employer.
(c) Governing Law. This Agreement shall be governed by and constructed
in accordance with the laws of the State of Delaware without reference to
principles of conflict of laws.
(d) Taxes. Employer may withhold from any payments made under the
Agreement all federal, state, city or other applicable taxes as shall be
required by law.
(e) Amendments. No provision of this Agreement may be modified, waived
or discharged unless such modification, waiver or discharge is approved by
Employer's
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Board or a duly authorized committee thereof. No waiver by any party hereto at
any time of any breach by any other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No waiver of any provision of this
Agreement shall be implied from any course of dealing between or among the
parties hereto or from any failure by any party hereto to assert its rights
hereunder on any occasion or series of occasions.
(f) Severability. In the event that any one or more of the provisions
of this Agreement shall be or become invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
contained herein shall not be affected thereby.
(g) Notices. Any notice or other communication required or permitted to
be delivered under this Agreement shall be (i) in writing, (ii) delivered
personally, by courier service or by certified or registered mail, first-class
postage prepaid and return receipt requested, (iii) deemed to have been received
on the date of delivery or on the third business day after the mailing thereof,
and (iv) addressed as follows (or to such other address as the party entitled to
notice shall hereafter designate in accordance with the terms hereof):
(i) If to Employer, to it at:
Remington Arms Company, Inc.
Post Office Box 700
Madison, North Carolina 27025
Attention: Secretary
(ii) If to Executive, to him at the address listed in
Section 5 of Attachment A.
(h) Survival. Sections 8, 9, 10, 11, 12, 13, 14, 17, 18, 19(b), (c) and
(f) and, if Executive's employment terminates in a manner giving rise to a
payment under Section 7(f), Section 7(f) shall survive the termination of the
employment of Executive hereunder.
(i) No Conflicts. Executive and Employer each represent that they are
entering into this Agreement voluntarily and that Executive's employment
hereunder and each party's compliance with the terms and conditions of this
Agreement will not conflict with or result in the breach by such party of any
agreement to which it is a party or by which it may be bound.
(j) Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original and all of which together shall constitute
one and the same instrument.
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(k) Headings. The section and other headings contained in this
Agreement are for the convenience of the parties only and are not intended to be
a part hereof or to affect the meaning or interpretation hereof.
IN WITNESS WHEREOF, Employer has duly executed this Agreement
by its authorized representative and Executive has hereunto set his hand, in
each case effective as of the date first above written.
REMINGTON ARMS COMPANY, INC.
By:
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Name:
Title:
EXECUTIVE:
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Signature
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ATTACHMENT A
1. POSITION:
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2. ANNUAL BASE SALARY: $
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3. INCENTIVE COMPENSATION TARGET OPPORTUNITY: %
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4. SEVERANCE TERM:
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5. EXECUTIVE'S ADDRESS:
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