EXHIBIT 10.3
CONSULTING AGREEMENT
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AGREEMENT entered into as of September 12, 1996, by and between Rayovac
Corporation, a Wisconsin corporation ("Rayovac"), and Thomas F. Pyle, Jr. (the
"Consultant").
WHEREAS, as of the date hereof, Rayovac has completed its
recapitalization pursuant to the Stock Purchase and Redemption Agreement dated
this date by and among Rayovac, certain affiliates of Thomas H. Lee Company
("THL") and all of the shareholders of Rayovac, together with the consummation
of senior credit facilities and bridge mezzanine debt financing; and
WHEREAS, immediately prior to the Recapitalization, the Consultant
resigned as Chairman of the Board of Directors, Chief Executive Officer and
President of Rayovac; and
WHEREAS, Rayovac may require the Consultant's special skills and
services in connection with its business operations; and
WHEREAS, the Consultant is willing to provide such skills and services
to Rayovac.
NOW, THEREFORE, in consideration of the mutual promises contained
herein, the parties hereto, intending to be legally bound, do hereby agree as
follows:
1. Engagement. Rayovac hereby engages the Consultant for the Term (as
defined below) and upon the terms and conditions herein set forth to provide
consulting services to Rayovac, as reasonably requested by Rayovac. In
consideration of the remuneration herein specified, the Consultant accepts such
engagement and agrees to perform the services specified herein.
2. Term. The engagement hereunder shall be for a term commencing on the
date hereof and expiring at such time as the Consultant is no longer entitled to
a Consulting Fee (as defined below) pursuant to Section 4.1 (the "Term"). Upon
expiration of the Term, all obligations as b the parties (except for outstanding
reimbursements under Section 4.2) shall be without recourse to one another under
this Agreement.
3. Services to be Performed. So long as Rayovac provides the Consultant
with reasonable notice, the Consultant shall make himself available for brief
consultations or brief assignments by telephone or in Madison, Wisconsin or in
the general area where he is at that time locate However, no precise number of
hours is to be devoted by the Consultant on a monthly basis for such services.
4. Compensation; Expense Reimbursement.
4.1 In consideration of the consulting services hereunder, Rayovac
shall pay the Consultant an annual fee (hereinafter, the "Consulting Fee") equal
to $200,000, which Consulting Fee shall be paid in equal monthly installments
each year, to be paid monthly in arrears; provided, however, that Rayovac's
obligation to pay the Consulting Fee pursuant to this Section 4.1 shall exist
only so long as (i) THL or an affiliate of THL is also receiving a Consulting
Fee from Rayovac (the "THL Consulting Fee") and (ii) the Consultant (a) is
subject to the non-competition provisions set forth in the Confidentiality,
Non-Competition, No-Solicitation and No-Hire Agreement between the parties dated
this date or (b) retains at least 5% of the outstanding capital stock of Rayovac
(on a fully diluted basis); and provided further, that if the THL Consulting Fee
is reduced and such reduction is not otherwise provided to THL through other
means or increased, the Consulting Fee shall be reduced or increased on a
pro-rata basis.
4.2 Rayovac shall reimburse the Consultant for all reasonable
out-of-pocket expenses incurred in connection with services to be provided by
the Consultant hereunder, including, without limitation, reasonable travel,
lodging and similar out-of-pocket costs reasonably incurred by him connection
with or on account of his performance of services for Rayovac hereunder.
Reimbursement shall be made only upon presentation to Rayovac by the Consultant
of reasonably itemized documentation therefor. Rayovac shall pay the Consultant
$1,000 per hour for any services which require travel other than within the
general area where Consultant is at that time located or to Madison, Wisconsin.
Notwithstanding the
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foregoing, the Consultant shall not be required to return to Madison to perform
any such services.
5. Indemnification. In addition to its agreements and obligations under
this Agreement, Rayovac agrees to indemnify and hold harmless the Consultant
from and against any and all claims, liabilities, losses and damages (or actions
in respect thereof), in any way related to or a out of the performance by the
Consultant of services hereunder, and to reimburse the Consultant and any other
such indemnified person for reasonable out-of-pocket legal and other expenses
incurred by it in connection with or relating to investigating, preparing to
defend, or defending any actions, claims or other proceedings (including any
investigation or inquiry) arising in any manner out of or in connection with the
Consultant's performance under this Agreement (whether or not such indemnified
person is a named party in such proceeding); provided, however, that Rayovac
shall not be responsible under this Section 5 for any claims, liabilities,
losses, damages or expenses to the extent that they are finally judicially
determined to result from actions taken by the Consultant (or such other
indemnified person) due primarily to the Consultant's (or such other indemnified
person's) gross negligence or willful misconduct.
6. Notice. All notices hereunder, to be effective, shall be in writing
and shall be mailed by certified mail, postage prepaid as follows:
(i) If to Rayovac:
601 Rayovac Drive
Madison, WI 53711-2497
Attention: President
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(ii) If to the Consultant:
415 Farwell Drive
Madison, WI 53704
7. Modifications. This Agreement constitutes the entire agreement
between the parties hereto with regard to the subject matter hereof, superseding
all prior understandings and agreements whether written or oral. This Agreement
may not be amended or revised except by a writing by the parties.
8. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and assigns
but may not be assigned by either party without the prior written consent of the
other.
9. Captions. Captions have been inserted solely for the convenience of
reference and in no way define, limit or describe the scope or substance of any
provision and shall not affect the validity of any other provision.
10. Governing Law. This Agreement shall be construed under and governed
by the laws of the State of Wisconsin, without reference to its conflicts of law
principles.
11. Counterparts. This Agreement may be signed in two counterparts,
each of which shall be deemed an original but which together shall constitute
one and the same instrument.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the date first above written.
RAYOVAC CORPORATION
By /s/ Warren C. Smith, Jr.
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Name: Warren C. Smith, Jr.
Title: Director
CONSULTANT:
/s/ Thomas F. Pyle, Jr.
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Thomas F. Pyle, Jr.
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