EX-10.11 3 d55007exv10w11.htm EMPLOYMENT AGREEMENT WITH JACKELYN E. WERBLO exv10w11
 

Exhibit 10.11
Easton-Bell Sports, Inc.
6225 N. State Highway 161
Irving Texas, 75038
February 11, 2008
By hand delivery
Ms. Jackelyn E. Werblo
c/o Easton-Bell Sports, Inc.
6225 N. State Highway 161
Irving Texas, 75038
Dear Jackie:
     Easton-Bell Sports, Inc. (the “Company”) has determined that, given the nature of your position, the interests of the Company will be best served by providing you the assurance of severance benefits, as described below, in the event that your employment is terminated by the Company other than for cause. Therefore, the purpose of this letter is to confirm the agreement between you and the Company concerning termination of your employment and certain ancillary matters, as follows:
     1. Severance Benefits. If your employment is terminated by the Company other than for Cause, as defined below, the Company will provide you the following severance payments and other benefits (in the aggregate, the “Severance Benefits”), provided that you satisfy the conditions set forth in this Agreement:
          (a) The Company will provide you severance pay, at the same rate as that of your base salary on the date your employment terminates (the “Termination Date”), for the period of twelve (12) months following the Termination Date (the “Severance Pay Period). Severance pay will be provided you in the form of salary continuation in accordance with the Company’s normal payroll practices. The first payment will be due and payable on the Company’s next regular payday for executives that follows the expiration of thirty (30) calendar days from the Termination Date, but shall be retroactive to the day immediately following the Termination Date.
          (b) Provided that you and your eligible dependents, if any, exercise your rights to continue participation in the Company’s group health and dental plans in a timely manner under the federal law known as “COBRA,” the Company will pay the premium cost of your participation and that of your eligible dependents in those plans from the Termination Date until the earliest to occur of (i) the last day of the Severance Pay Period, (ii) the date you become

 


 

eligible to enroll in the health and/or dental plan of another employer or (iii) the date you or any of your dependents otherwise ceases to be eligible to continue participation in these Company plans under COBRA. You agree to notify the Company promptly if you become eligible to enroll in the health or dental plan of another employer or if you or any of your dependents otherwise ceases to be eligible for continued coverage under COBRA. After the Company’s contributions end, you may continue coverage for the remainder of the COBRA period, if any, by paying the full premium cost plus a small administrative fee.
          (c) The Company will pay you a pro-rated annual bonus for the final year in which the Termination Date occurs. The bonus will be determined by multiplying the annual bonus you would have received had you continued employment through the last day of that fiscal year by a fraction, the numerator of which is the number of days you were employed during the fiscal year, through the Termination Date, and the denominator of which is 365. The pro-rated bonus will be payable at the time annual bonuses are paid to Company executives generally under its bonus plan.
          (d) In addition to the pro-rated annual bonus to be provided under Section 1(c) immediately above, in the event that the Termination Date occurs prior to the date on which payment is made of annual bonuses for the immediately preceding fiscal year, you will be paid that annual bonus on the later of the date annual bonuses for that preceding fiscal year are paid to Company executives generally and the payday on which the first payment is made under Section 1(a) of this Agreement.
     2. Other Separation Provisions.
          (a) It is agreed that, (i) in the event of termination of your employment by the Company other than for Cause you will be entitled to receive, in addition to the severance benefits set forth in Section 1, and (ii) in the event of any other termination of your employment, however occurring, you shall be entitled to receive only: (A) your base salary for the final payroll period of your employment through the Termination Date, (B) pay, at your final base salary rate, for any vacation you have earned but not used as of the Termination Date and (C) reimbursement of any business expenses incurred on or before the Termination Date which are eligible for reimbursement under Company policies then in effect and are submitted by you with required documentation and substantiation no later than sixty (60) days following the Termination Date.
          (b) Except for any right you and your eligible dependents, if any, have to continue participation in the Company’s group health and dental plans under COBRA following termination of your employment, your participation in Company benefit plans will terminate on the Termination Date in accordance with the terms thereof.
          (c) Any equity in Easton-Bell Sports, LLC that you hold on the Termination Date shall be governed by the terms of the Unit Certificate, the Plan and the LLC Agreement, as applicable.

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     3. Conditions to Severance Benefit Eligibility. In order to be eligible to receive the Severance Benefits, you must meet all of the following conditions: (a) Your employment must be terminated by the Company other than for Cause. A termination of employment by the Company for Cause or such a termination resulting from death or from disability (meaning termination as a result of your being unable to perform the essential functions of your job with or without accommodation after exhaustion of any leave to which you are entitled or which is otherwise granted you by the Company voluntarily) or any termination by you of your employment shall not qualify you for Severance Benefits. (b) Following the Termination Date, you must sign and return in a timely and effective release of claims in the form that is attached to this Agreement as Exhibit A (the “Release”). The Release creates legally binding obligations and the Company advises you to seek the advice of an attorney before signing it. (c) You must comply meet in full your obligations under this Agreement during your employment and thereafter, in accordance with its terms.
          (d) The Executive may terminate his employment hereunder for Good Reason upon notice to the Company setting forth in reasonable detail the nature of such Good Reason. For purposes of this Agreement, “Good Reason” shall mean, without the Executive’s consent, the occurrence of any one or more of the following events: (i) the material breach of this Agreement by the Company which is not cured, if curable, within twenty (20) days after written notice to the Company specifying in reasonable detail the nature of such breach; (ii) a material diminution of any of the Executive’s significant duties or the assignment to the Executive of material duties inconsistent with his position (iii) any reduction in or failure to pay the Base Salary or any failure to pay any Annual Bonus to which the Executive is entitled hereunder or any failure to provide benefits in accordance with this Agreement or any material failure to provide Executive Perquisites in accordance with this Agreement, in each case only after the Company has been given an opportunity, and has failed, to cure any such event within twenty (20) days following the Executive’s written notice to the Company specifying in reasonable detail the nature of the reduction or failure; (iv) any relocation of the Executive’s primary worksite to a site that is more than thirty-five (35) miles from the Executive’s current office location (Irving, TX) without the provision of relocation benefits consistent with those provided to other Executives; such relocation benefits to include geographic subsidy, if moving to a location which the Economic Research Institute (ERI) deems to have a cost of living which is more than 10% higher than the current office location, when considering housing, taxes and transportation costs, temporary living and household goods move; (v) subjection of the Executive to a working environment sufficiently hostile or otherwise adverse as to satisfy the general legal standard for a constructive discharge, provided that the Executive provides the Company written notice specifying in reasonable detail the circumstances rendering the working environment hostile or otherwise adverse and the Company fails within twenty (20) days of that notice to take remedial action to mitigate those circumstances.
     4. Employee’s Ancillary Covenants. It is acknowledged and agreed that the following covenants, which shall apply throughout your employment and following its termination (regardless of how it occurs) are ancillary to this Agreement between you and the Company with respect to your severance benefits:

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          (a) Confidential Information. You agree that the Company and its Affiliates (as defined below) continually develop Confidential Information (as defined below); that you have developed and may hereafter develop Confidential Information for the Company and its Affiliates; and that you have learned and may learn hereafter of Confidential Information during the course of employment. You agree to comply with the policies and procedures of the Company and its Affiliates for protecting Confidential Information and agree not to disclose to any Person or use any Confidential Information that you have obtained or obtain hereafter incident to your employment or any other associations with the Company or any of its Affiliates, other than as required for the proper performance of your regular duties and responsibilities to the Company and its Immediate Affiliates or as required by applicable law or legal process after notice to the Company and a reasonable opportunity for the Company to see protection of the Confidential Information prior to its disclosure. You agree that these restrictions shall continue to apply after your employment terminates, regardless of the reason for termination. The confidentiality obligation under this Section 4(a) does not apply, however, to information that is generally known or readily available to the public at the time of disclosure or becomes generally known through no wrongful act on your part or that of any other Person having an obligation of confidentiality to the Company or any of its Affiliates.
          (b) Protection of Documents. All documents, records and files, in any media of whatever kind and description, relating to the business, present or otherwise, of the Company or any of its Affiliates, and any copies, in whole or in part, thereof (the “Documents”), whether or not prepared by you, shall be the sole and exclusive property of the Company. You agree to safeguard all Documents and to surrender to the Company, at the time your employment terminates (without regard to the reason for termination) or at such earlier time or times as the Company may specify, all Documents and other property of the Company and its Affiliates then in your possession or control.
          (c) Restricted Activities. You acknowledge the importance to the Company and its Immediate Affiliates of protecting their trade secrets, other Confidential Information and goodwill that they have developed or acquired and which they shall continue to develop and acquire while your employment continues. Further, in addition to assurances of Separation Benefits in accordance with this Agreement, the Company agrees, in consideration of your acceptance of the restrictions set forth below, to grant you access to trade secrets and other Confidential Information of the Company and its Immediate Affiliates as well as to their valuable relationships with employees and others. You in turn acknowledge and agree that the restrictions on your activities during and after your employment set forth below are necessary to protect the goodwill, Confidential Information and other legitimate interests of the Company and its Immediate Affiliates:
               (i) You agree that, during your employment with the Company and for the period of twelve (12) months immediately following the Termination Date, however it occurs, you will not, directly or indirectly, alone or in association with others, anywhere in the United States where the Company or any of its Immediate Affiliates is doing or actively planning to do business, own, manage, operate, control or participate in the ownership, management, operation or control of, or be connected as an officer,

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employee, investor, principal, joint venturer, shareholder, partner, director, consultant, agent or otherwise with, or have any financial interest (through equity ownership or otherwise) in, any business, venture or activity that directly or indirectly competes, or is in planning, or has undertaken any preparation, to compete, with the business of the Company or any of its Immediate Affiliates (a “Competitor”), except that nothing contained in this Agreement shall prevent your wholly passive ownership of five percent (5%) or less of the equity securities of any Competitor that is a publicly-traded company.
               (ii) You agree that, during your employment with the Company and for the period of twelve (12) months immediately following the Termination Date, however it occurs, you will not, directly or indirectly, hire or otherwise engage to provide services or attempt to hire or so engage, any employee or independent contractor providing services to the Company or any of its Immediate Affiliates; assist in such hiring or engagement by any other person or entity; or encourage any employee or independent contractor providing services to the Company or any of its Immediate Affiliates to terminate or diminish his or her relationship with the Company or such Immediate Affiliate. For purposes of this Agreement, an “employee” means any person who was employed by, or had an offer of employment from, the Company or any of its Immediate Affiliates on the Termination Date or at any time during the preceding six months and an “independent contractor” means any person otherwise providing services to the Company or any of its Immediate Affiliates on the Termination Date or at any time during the preceding six months.
               (iii) You agree that, during your employment with the Company and for the period of twelve (12) months immediately following the Termination Date, however it occurs, you will not, directly or indirectly, solicit or encourage any customer or other Person doing business with the Company or any of its Immediate Affiliates to terminate or diminish its relationship with the Company or any of its Immediate Affiliates; provided, however, that, after termination of your employment with the Company, these restrictions shall apply only with respect to those customers and other Persons doing business with the Company or any of its Immediate Affiliates on the Termination Date or at any time during the preceding six (6) months whom you know or reasonably should know is a customer or otherwise doing business with the Company or any of its Immediate Affiliates.
          (d) Enforcement of Covenants. You acknowledge that you have carefully read and considered all the terms and conditions of this Agreement, including the restraints imposed on you under this Section 4. You agree without reservation that each of the restraints contained here is necessary for the reasonable and proper protection of the goodwill, Confidential Information and other legitimate interests of the Company and its Immediate Affiliates; that each and every one of those restraints is reasonable in respect to subject matter, length of time and geographic area; and that these restraints, individually or in the aggregate, will not prevent you from obtaining other suitable employment during the period in which you are bound by these restraints. You also acknowledge that if you were to breach any of the covenants contained in this Section 4, the damage to the Company and its Immediate Affiliates would be

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irreparable. You therefore agree that the Company, in addition to any other remedies available to it, shall be entitled to preliminary and permanent injunctive relief against any breach or threatened breach by you of any of these covenants. You and the Company also agree that, in the event any provision of this Section 4 shall be determined by any court of competent jurisdiction to be unenforceable by reason of its being extended over too great a time, too large a geographic area or too great a range of activities, that provision shall be deemed to be modified to permit its enforcement to the maximum extent permitted by law.
     5. Withholding. All payments made by the Company under this Agreement shall be reduced by any tax or other amounts required to be withheld by the Company under applicable law.
     6. Definitions. For purposes of this Agreement, the following definitions apply:
          (a) “Affiliates” means all persons and entities directly or indirectly controlling, controlled by or under common control with the Company, where control may be by management authority, contract or equity interest.
          (b) Termination by the Company for “Cause” shall mean only (i) your refusal or willful failure to perform, or serious negligence in the performance of, your duties and responsibilities for the Company which remains uncured, continues or recurs after ten (10) business days’ notice from the Company describing in reasonable detail the nature of the refusal, failure or neglect; (ii) your material breach of breach of this Agreement or of any fiduciary duty or duty of loyalty owed to the Company or any of its Immediate Affiliates; (iii) fraud or other material dishonesty with respect to the Company or any of its Immediate Affiliates (meaning its direct and indirect parents and subsidiaries and its parents other direct and indirect subsidiaries); or (iv) other conduct that is, or could reasonably be expected to be, materially harmful to the business interests or reputation of the Company or any of its Immediate Affiliates.
          (c) “Confidential Information” means any and all information of the Company and its Immediate Affiliates that is not generally known by those with whom the Company or any of its Immediate Affiliates competes or does business, or with whom the Company or any of its Immediate Affiliates plans to compete or do business, including without limitation (i) information related to the Products, technical data, methods, processes, know-how and inventions of the Company and its Immediate Affiliates, (ii) the development, research, testing, marketing and financial activities and strategic plans of the Company and its Immediate Affiliates, (iii) their costs and sources of supply, (iv) the identity and special needs of the customers and prospective customers of the Company and its Immediate Affiliates and (v) the employees and other Persons with whom the Company and its Immediate Affiliates have business relationships and the nature and substance of those relationships. Confidential Information also includes any information that the Company or any of its Affiliates may receive or has received from customers, employees or others with any understanding, express or implied, that the information would not be disclosed.

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          (d) “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate, a trust and any other entity or organization, other than the Company or any of its Immediate Affiliates.
          (e) “Products” means all products planned, researched, developed, tested, manufactured, sold, licensed, leased or otherwise distributed or put into use by the Company or any of its Immediate Affiliates, together with all services provided or planned by the Company or any of its Immediate Affiliates, during your employment.
     7. Miscellaneous. This is the entire agreement between you and the Company, and supersedes all prior and contemporaneous communications, agreements and understandings, written or oral, with respect to the subject matter hereof. This Agreement may not be modified or amended, and no breach shall be treated as being waived, unless in writing and signed by you and an expressly authorized representative of the Company. Provisions of this Agreement shall survive any termination if so provided here or if necessary or desirable to accomplish the purposes of other surviving provisions, including without limitation the obligations of the Company under Section 1 in the event of a termination of your employment by the Company other than for Cause and your obligations under Section 4. The headings of this Agreement are only for convenience and are not part of this Agreement. This Agreement is a contract for the provision of severance benefits in accordance with its terms and is not intended, and shall not be interpreted, to restrict your right or that of the Company to terminate your employment relationship with the Company. Nor does this Agreement in any way restrict the Company’s alteration of any of the terms or conditions of your employment, other than as expressly provided herein. This is a Texas contract and shall be governed and construed in accordance with the laws of the State of Texas, without regard to its conflict-of-laws principles.
     If the terms of this Agreement are acceptable to you, please so indicate by signing and returning the original of this letter to me within ten (10) business days of its date. The second copy is for your records.
Sincerely,
EASTON-BELL SPORTS, INC.
/s/ ANTHONY M. PALMA
Anthony M. Palma
CEO
Accepted and agreed:
         
Signature:
  /s/ JACKELYN E. WERBLO    
 
 
 
Jackelyn E. Werblo
   
Date signed: February 20, 2008

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Exhibit A
RELEASE OF CLAIMS
     FOR AND IN CONSIDERATION OF the benefits to be provided me in connection with the termination of my employment, as set forth in the agreement between me and Easton-Bell Sports, Inc. (the “Company”) dated on or about February 11, 2008 (the “Agreement”), which are conditioned on my signing this Release of Claims and to which I am not otherwise entitled, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, I, Jackelyn E. Werblo, on my own behalf and on behalf of my heirs, executors, administrators, beneficiaries, representatives and assigns, and all others connected with me, hereby release and forever discharge the Company and its Affiliates (as defined in the Agreement) and all of their respective past, present and future officers, directors, shareholders, employees, agents, general and limited partners, members, managers, joint venturers, representatives, successors and assigns, and all others connected with any of them, both individually and in their official capacities, from any and all causes of action, rights and claims of any type or description, known or unknown, which I have had in the past, now have, or might now have, through the date of my signing of this Release of Claims, including without limitation any causes of action, rights or claims in any way resulting from, arising out of or connected with my employment by the Company or any of its Affiliates or the termination of that employment or pursuant to any federal, state or local law, regulation or other requirement (including without limitation Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with Disabilities Act and the fair employment practices laws of the state or states in which I have been employed by the Company or any of its Affiliates, each as amended from time to time).
Excluded from the scope of this Release of Claims is (i) any claim arising under the terms of the Agreement after the effective date of this Release of Claim and (ii) any right of indemnification or contribution that I have pursuant to the Articles of Incorporation or By-Laws of the Company or any of the governing documents of its Immediate Affiliates (as defined in the Agreement).
In signing this Release of Claims, I acknowledge my understanding that I may not sign it prior to the termination of my employment, but that I may consider the terms of this Release of Claims for up to twenty-one (21) days (or such longer period as the Company may specify) from the date my employment with the Company terminates. I also acknowledge that I have been advised by the Company in the Agreement to seek the advice of an attorney prior to signing this Release of Claims; that I have had sufficient time to consider this Release of Claims and to consult with an attorney, if I wished to do so, or to consult with any other person of my choosing before signing; and that I am signing this Release of Claims voluntarily and with a full understanding of its terms.
I further acknowledge that, in signing this Release of Claims, I have not relied on any promises or representations, express or implied, that are not set forth expressly in the Agreement. I understand that I may revoke this Release of Claims at any time within seven (7) days of the date of my signing by written notice to the Company c/o Timothy Mayhew, Fenway Partners, Inc., ,

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with a copy to Aron Schwartz, Fenway Partners, Inc., 152 W. 57th St., 59th Floor, New York, NY 10019, or to such other address as the Company party may specify and that this Release of Claims will take effect only upon the expiration of such seven-day revocation period and only if I have not timely revoked it.
Intending to be legally bound, I have signed this Release of Claims as of the date written below.
         
Signature:
       
 
 
 
Jackelyn E. Werblo
   
Date Signed:
       
 
 
 
   

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