Exhibit 10.1

 

Employment Agreement

 

This Employment Agreement (the “Agreement”), effective as of July 1, 2018 (the
“Effective Date”), is made and entered into by and between Terry D. McNew (the
“Executive”) and MasterCraft Boat Company, LLC, a Delaware limited liability
company whose principal place of business is located at 100 Cherokee Cove Drive,
Vonore, Tennessee 37885 (“MasterCraft”), together with all of its subsidiaries
and affiliates as may employ the Executive from time to time, and any
successor(s) thereto, (collectively, the “Company”).

 

RECITALS

 

A.                               The Company desires to assure itself of the
services of the Executive by engaging the Executive to perform services under
the terms hereof.

 

B.                               The Executive desires to provide services to
the Company on the terms herein provided.

 

C.                               The Company and the Executive entered into an
Employment Agreement, effective as of July 26, 2012, and a further Employment
Agreement dated July 1, 2015, and both parties now desire to enter into this
Agreement which supersedes such prior Employment Agreements in their entirety.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing and of the respective
covenants and agreements set forth in this Agreement, the parties hereto agree
as follows:

 

1.                                      Certain Definitions.

 

(a)                                 “Affiliate” shall mean, with respect to any
Person, any other Person directly or indirectly controlling, controlled by, or
under common control with, such Person.

 

(b)                                 “Agreement” shall have the meaning set forth
in the preamble hereto.

 

(c)                                  “Annual Base Salary” shall have the meaning
set forth in Section 3(a).

 

(d)                                 “Annual Bonus” shall have the meaning set
forth in Section 3(b).

 

(e)                                  “Board” shall refer to the Board of
Directors of MCBC Holdings, Inc. (“Holdings”), the parent corporation of
MasterCraft and of other MasterCraft affiliates.

 

(f)                                   “Cause” shall mean: (i) the Executive’s
material failure to substantially perform the duties set forth herein (other
than any such failure resulting from the Executive’s Disability); (ii) the
Executive’s material failure to carry out, or comply with, in any material
respect any lawful directive of the Board; (iii) the Executive’s commission at
any time of any act or omission that results in, or may reasonably be expected
to result in a conviction, plea of no contest, plea of nolo contendere, or
imposition of unadjudicated probation for any felony or crime involving moral
turpitude; (iv) the Executive’s unlawful use (including being under the
influence) or possession of illegal drugs on the Company’s premises or while
performing the Executive’s duties and responsibilities hereunder; (v) the
Executive’s commission at any time of

 

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any act of fraud, embezzlement, misappropriation, misconduct, conversion of
assets of the Company, or breach of fiduciary duty against the Company (or any
predecessor thereto or successor thereof); or (vi) the Executive’s material
breach of this Agreement or other agreements with the Company (including,
without limitation, any breach of the restrictive covenants of any such
agreement); and which, in the case of clauses (i), (ii) and (vi), continues
beyond fifteen (15) days after the Company has provided the Executive written
notice of such failure or breach (to the extent that, in the reasonable judgment
of the Board, such failure or breach can be cured by the Executive). Whether or
not an event giving rise to “Cause” occurs will be determined by the Board in
its sole discretion.

 

(g)                                 “Code” shall mean the Internal Revenue Code
of 1986, as amended.

 

(h)                                 “Company” shall, except as otherwise
provided in Section 6(k), have the meaning set forth in the preamble hereto.

 

(i)                                    “Company Employee” shall have the meaning
set forth in Section 6(b).

 

(j)                                    “Competitive Product” shall have the
meaning set forth in Section 6(a).

 

(k)                                 “Date of Termination” shall mean (1) if the
Executive’s employment is terminated due to the Executive’s death, the date of
the Executive’s death; (2) if the Executive’s employment is terminated due to
the Executive’s Disability, the date determined pursuant to Section 4(a)(ii);
(3) if the Executive’s employment is terminated pursuant to Section 4(a)(iii)-
(iv), the date indicated in the Notice of Termination; and (4) if the
Executive’s employment is terminated pursuant to Section 4(a)(v), the date
indicated in the Notice of Termination or the date specified by the Company
pursuant to Section 4(b), whichever is earlier.

 

(l)                                    “Disability” shall mean the Executive’s
inability to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment that can be expected to
result in death or that can be expected to last for a continuous period of not
less than six (6) months.

 

(m)                             “Effective Date” shall have the meaning set
forth in the preamble hereto.

 

(n)                                 “Executive” shall have the meaning set forth
in the preamble hereto.

 

(o)                                 “Installment Payments” shall have the
meaning set forth in Section 5(b)(i).

 

(p)                                 “LTIP” shall mean any Long-Term Incentive
Plan as may be adopted by the Directors from time to time to provide appropriate
incentive compensation to the Company’s executives based upon performance
targets established by the Board (or the Compensation Committee thereof), in
consultation with the Executive, as referenced in Section 3(c).

 

(q)                                 “Notice of Termination” shall have the
meaning set forth in Section 4(b).

 

(r)                                  “Person” shall mean any individual, natural
person, corporation (including any non-profit corporation), general partnership,
limited partnership, limited liability partnership, joint venture, estate,
trust, company (including any company limited by shares, limited liability

 

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company or joint stock company), incorporated or unincorporated association,
governmental authority, firm, society or other enterprise, organization or other
entity of any nature.

 

(s)                                   “Proprietary Information” shall have the
meaning set forth in Section 6(e).

 

(t)                                    “Restricted Period” shall mean the
eighteen (18) month period immediately following the Date of Termination;
provided, however, that if the Executive continues to be employed by the Company
subsequent to the termination of this Agreement, the “Restricted Period” shall
include such continued period of employment after termination of this Agreement
and the eighteen (18) month period immediately following the day upon which the
Executive is no longer employed by the Company.

 

(u)                                 “Section 409A” shall mean Section 409A of
the Code and the Department of Treasury regulations and other interpretive
guidance issued thereunder, including without limitation any such regulations or
other guidance that may be issued after the Effective Date.

 

(v)                                 “Severance Payment” shall have the meaning
set forth in Section 5(b).

 

(w)                               “Severance Period” shall have the meaning set
forth in Section 5(b).

 

(x)                                 “Solicit” shall have the meaning set forth
in Section 6(b).

 

(y)                                 “STIP” shall mean any Short-Term Incentive
Plan as may be adopted by the Directors from time to time to provide appropriate
incentive compensation to the Company’s executives based upon annual performance
targets established by the Board (or the Compensation Committee thereof), in
consultation with the Executive, as referenced in Section 3(b).

 

(z)                                  “Term” shall have the meaning set forth in
Section 2(b).

 

2.                                      Employment.

 

(a)                                 In General. The Company shall employ the
Executive and the Executive shall enter the employ of the Company, for the
period set forth in Section 2(b), in the position set forth in Section 2(c), and
upon the other terms and conditions herein provided.

 

(b)                                 Term of Employment. The term of employment
under this Agreement (the “Initial Term”) shall commence on the Effective Date
and terminate on fourth anniversary thereof, unless earlier terminated as
provided in Section 4 of this Agreement. The Initial Term may be extended by the
Board, in its discretion, for successive one (1) year periods (each, an
“Extension Term” and, collectively with the Initial Term, the “Term”), by
delivery of a written notice to Executive prior to the expiration of the
then-applicable Term.

 

(c)                                  Position and Duties. During the Term, the
Executive: (i) shall serve as the President and Chief Executive Officer of MCBC
Holdings, Inc., President and Chief Executive Officer of MasterCraft, Chief
Executive Officer of Nautic Star, LLC, Chief Executive Officer of NS Transport,
LLC, Chief Executive Officer of Navigator Marine, LLC, President of MasterCraft
International Sales Administration, Inc., President of MCBC Hydra Boats, LLC,
President of MasterCraft Services, Inc., and as a Director of MasterCraft Parts
Limited, with

 

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responsibilities, duties and authority customary for such position, subject to
direction by the Board; (ii) shall report directly to the Board; (iii) shall
devote substantially all the Executive’s working time and efforts to the
business and affairs of the Company and its subsidiaries and affiliates;
(iv) agrees to observe and comply with the Company’s rules and policies as
adopted by the Company from time to time; and (v) agrees that his duties,
responsibilities and authorities may include services for one or more
subsidiaries and affiliates of MasterCraft. In addition, the Executive is
serving as a Director of Holdings, and the Board shall propose the Executive for
reelection to the Board for so long as Executive serves in the offices described
in this Section 2(c).

 

(d)                                 Work Location. During the Term, the primary
place for performance of the Executive’s duties and responsibilities shall be
the Company’s headquarters in Vonore, Tennessee. The Executive further
acknowledges that his position may require business travel from time to time.

 

3.                                      Compensation and Related Matters.

 

(a)                                 Annual Base Salary. During the Term, the
Executive shall receive a base salary in the amount of Five Hundred Thousand and
No/100 Dollars ($500,000.00) per annum (the “Annual Base Salary”). The Annual
Base Salary shall be paid in accordance with the customary payroll practices of
the Company, subject to review by the Board (or the applicable committee
thereof) in its sole discretion.

 

(b)                                 Annual Bonus — Short-Term Incentive Plan.
With respect to each fiscal year that ends during the Term, commencing with
fiscal year ending on June 30, 2019, the Executive shall be eligible to receive
an annual cash bonus (the “Annual Bonus”) in accordance with the terms of the
STIP adopted by the Board, from time to time, based upon annual performance
targets established by the Board (or the Compensation Committee thereof) in
connection with the STIP, in consultation with the Executive. Each such Annual
Bonus shall be payable on such date as is determined by the Board (or the
Compensation Committee thereof) in its sole discretion. The Board shall have the
authority to adopt, modify or change the terms of any STIP from time to time, in
the Board’s sole discretion.

 

(c)                                  Long-Term Incentive Plan. During the Term,
the Executive shall be eligible to participate in any LTIP as may be adopted by
the Board, from time to time, based upon performance targets established by the
Board (or the Compensation Committee thereof) in connection with the LTIP, in
consultation with the Executive. The vesting and granting of any form of equity
(including, without limitation, shares of stock, performance shares, restricted
shares, and/or options to acquire shares of stock) shall be in accordance with
the terms of the LTIP as determined by the Board (or the Compensation Committee
thereof) in its sole discretion. The Board shall have the authority to adopt,
modify or change the terms of any LTIP from time to time, in the Board’s sole
discretion.

 

(d)                                 Benefits. During the Term, the Executive
shall be eligible to participate in employee benefit plans, programs and
arrangements of the Company, as in effect from time to time. Such plans may
include, without limitation, health care, dental, vision, prescription, flexible
spending, short-term and long-term disability, life insurance and 401(k) plans,
programs and arrangements.

 

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(e)                                  Vacation. During the Term, the Executive
shall be eligible to take four (4) weeks of paid vacation per year. Unused and
accrued vacation does not roll over to the next calendar year. That is, if the
Executive does not use all four (4) weeks of vacation in any given year, he may
not use any of that unused vacation time the following or any other year.

 

(f)                                   Business Expenses. During the Term, the
Company shall reimburse the Executive for all reasonable travel and other
business expenses incurred by the Executive in the performance of the
Executive’s duties to the Company in accordance with the Company’s applicable
expense reimbursement policies and procedures.

 

4.                                      Termination of Employment. The
Executive’s employment hereunder may be terminated by the Company or the
Executive, as applicable, under the circumstances described in Section 4(a) in
accordance with the provisions of Section 4(b).

 

(a)                                 Circumstances.

 

(i)                               Death. The Executive’s employment hereunder
shall terminate
upon the Executive’s death.

 

(ii)                           Disability. If the Executive incurs a Disability,
the Company may give the Executive written notice of its intention to terminate
the Executive’s employment. In that event, the Executive’s employment with the
Company shall terminate, effective on the later of the thirtieth (30th) day
after receipt of such notice by the Executive or the date specified in such
notice; provided that within the thirty (30)-day period following receipt of
such notice, the Executive shall not have returned to full-time performance of
the Executive’s duties hereunder.

 

(iii)                       Termination for Cause. The Company may terminate the
Executive’s employment for Cause.

 

(iv)                        Termination Without Cause. The Company may terminate
the Executive’s employment Without Cause.

 

(v)                            Resignation. The Executive may resign from the
Executive’s employment for any reason or no reason.

 

(vi)                        Non-Extension of the Term. The Company may elect not
to extend the Term for an Extension Term in accordance with Section 2(b).
Non-extension of the Term shall not constitute termination by the Company
Without Cause or a resignation of employment by the Executive.

 

(b)                                 Notice of Termination. Any termination of
the Executive’s employment hereunder by the Company or by the Executive under
this Section 4 (other than a termination pursuant to Section 4(a)(i) or
4(a)(vi)) shall be communicated by a written notice to the other party hereto (a
“Notice of Termination”). The Notice of Termination shall: (i) indicate the
specific termination provision in this Agreement relied upon, (ii) in the case
of a termination pursuant to Sections 4(a)(ii) or 4(a)(iii), set 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, and
(iii) specify a Date of Termination (which, if submitted by the Executive, shall
be at least ninety (90) days following the date of such notice); provided,
however, that a Notice of

 

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Termination delivered by the Company pursuant to Section 4(a)(ii) shall not be
required to specify a Date of Termination, in which case the Date of Termination
shall be determined pursuant to Section 4(a)(ii); and provided, further, that in
the event that the Executive delivers a Notice of Termination to the Company,
the Company may, in its sole discretion, accelerate the Date of Termination to
any date that occurs following the date of the Company’s receipt of such Notice
of Termination (even if such date is prior to the date specified in such Notice
of Termination).

 

A Notice of Termination submitted by the Company (other than a Notice of
Termination under Section 4(a)(ii)) may provide for a Date of Termination on the
date the Executive receives the Notice of Termination, or any date thereafter
elected by the Company in its sole discretion. The failure by the Company to set
forth in the Notice of Termination any fact or circumstance which contributes to
a showing of Cause shall not waive any right of the Company hereunder or
preclude the Company from asserting such fact or circumstance in enforcing the
Company’s rights hereunder.

 

5.                                      Company Obligations Upon Termination of
Employment. During the Term of this Agreement, the Company shall have the
following obligations upon the termination of the Executive’s employment with
the Company as described in this Section 5:

 

(a)                                 In General. Upon termination of the
Executive’s employment for any reason, the Executive (or the Executive’s estate)
shall be entitled to receive: (i) any portion of the Executive’s Annual Base
Salary through the Date of Termination not theretofore paid, (ii) any expenses
owed to the Executive under Section 3(e), and (iii) any amount arising from the
Executive’s participation in, or benefits under, any employee benefit plans,
programs or arrangements under Section 3(c), which amounts shall be payable in
accordance with the terms and conditions of such employee benefit plans,
programs or arrangements. Except as otherwise set forth in Section 5(b) hereof,
the payments and benefits described in this Section 5(a) shall be the only
payments and benefits payable in the event of the Executive’s termination of
employment for any reason.

 

(b)                                 Severance Payment. In the event of the
Executive’s termination of employment under the circumstances described below,
then, in addition to the payments and benefits described in Section 5(a) above,
the Company shall, during the twelve (12) month period immediately following the
Date of Termination (the “Severance Period”), pay to the Executive an amount
(the “Severance Payment”) calculated and paid as described below:

 

(i)                                    Base Severance Amount. If the Executive’s
employment shall be terminated by the Company without Cause pursuant to
Section 4(a)(iv), then the base severance amount shall be an amount equal to the
Executive’s Annual Base Salary (the “Base Severance Amount”). Subject to the
provisions of Section 8, the Base Severance Amount shall be paid in equal
installments during the Severance Period, at the same time and in the same
manner as the Annual Base Salary would have been paid had the Executive remained
in active employment during the Severance Period, in accordance with the
Company’s normal payroll practices in effect on the Date of Termination. For
purposes of Section 409A (including, without limitation, for purposes of
Section 1.409A-2(b)(2)(iii) of the Department of Treasury Regulations), the
Executive’s right to receive the Base Severance Amount in the form of
installment payments (the “Installment Payments”) shall be treated as a right to
receive a series of separate payments and, accordingly, each Installment Payment
shall at all times be considered a separate and distinct

 

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payment. In addition, to the extent the Executive shall earn compensation during
the Severance Period (without regard to when such compensation is paid), the
Base Severance Amount to be made by the Company pursuant to this
Section 5(b)(i) shall be correspondingly reduced in compliance with
Section 409A. In order to implement the provisions of this Section 5(b)(i), the
Executive shall promptly notify the Company of any subsequent employment during
the Severance Period and provide the Company with information regarding the
Executive’s compensation.

 

(ii)                           Continuation of Employee Benefits or Equivalent.
In addition, if the Executive’s employment shall be terminated by the Company
without Cause pursuant to Section 4(a)(iv), then to the extent the Executive or
any of the Executive’s dependents may be covered under the terms of any medical
or dental plans of the Company for active employees immediately prior to the
Date of Termination, provided the Executive is eligible for and elects coverage
under the health care continuation rules of COBRA, the Company shall provide the
Executive and those dependents with coverage for the duration of the Severance
Period, and such coverage shall be equivalent to the coverage received while the
Executive was employed with the Company, with Executive required to pay the same
amount as the Executive would pay if the Executive continued in employment with
the Company during such period; provided, however, that such coverage shall be
provided only to the extent that it does not result in any additional tax or
other penalty being imposed on the Company or violate any nondiscrimination
requirements then applicable with respect to the Company’s plans.

 

The coverages under this Section 5(b)(ii) may be procured directly by the
Company apart from, and outside of the terms of the respective plans, provided
that the Executive and the Executive’s dependents comply with all of the terms
of the substitute medical or dental plans, and provided, further, that the cost
to the Company shall not exceed the cost for continued COBRA coverage based on
the cost sharing set forth above in this Section 5(b)(ii). Notwithstanding
anything to the contrary contained herein, in the event the Executive or any of
the Executive’s dependents become eligible for coverage under the terms of any
other medical and/or dental plan of a subsequent employer, the Company’s
obligations under this Section 5(b)(ii) shall cease with respect to the eligible
Executive and/or dependent. In order to implement the provision of this
Section 5(b)(ii), the Executive shall promptly notify the Company of any
subsequent employment during the Severance Period and provide the Company with
information regarding medical and/or dental coverage available.

 

(iii)                       STIP and LTIP Payments. As described in Sections
3(b) and (c) hereof, if the Executive’s employment shall be terminated by the
Company without Cause pursuant to Section 4(a)(iv), then Executive shall remain
eligible for, and shall receive, the compensation under the terms of the STIP in
accordance with the Company’s actual financial performance compared to the
applicable targets, on a pro rata basis for that fiscal year, based upon the
relative percentage of the total number of days of Executive’s employment from
the beginning of the fiscal year through the Date of Termination in comparison
to the total number of days in the fiscal year. Likewise, Executive shall remain
eligible for, and shall receive, the compensation under the terms of the LTIP.
With regard to any performance or restricted shares to be granted under the
terms of the LTIP, such shares shall be granted in accordance with the Company’s
actual financial performance compared to the applicable targets, on a pro rata
basis for the fiscal years covered by each unvested LTIP award. The pro rata
calculation shall take the number of days since the start of the first fiscal
year for each specific award under the LTIP to

 

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the date of termination divided by the total number of days for the entire plan
horizon for each specific award under the LTIP. The Board shall have the
authority to adopt, modify or change the terms of any LTIP from time to time, in
the Board’s sole discretion.

 

(iv)                        Execution of Waiver & Release by Executive a
Pre-Requisite. The payments and benefits described in this Section 5(b) shall be
in lieu of notice or any other severance payments or benefits to which the
Executive might otherwise be entitled. Notwithstanding anything herein to the
contrary, (A) no portion of the payments or benefits described in clauses (i),
(ii) and (iii) shall be paid or provided unless, as of the thirtieth (30th) day
following the Date of Termination, the Executive has timely executed a general
waiver and release of claims agreement in the Company’s customary form (which
release shall be delivered by the Company to the Executive within seven (7) days
after the Date of Termination) and such release has not been revoked by the
Executive prior to the expiration of the period (if any) during which any
portion of such release is revocable under applicable law (and such revocation
period has expired), and (B) as of the first date on which the Executive
violates any covenant contained in Section 6, any remaining portion of the
payments or benefits described in clauses (i), (ii) and (iii) shall thereupon be
forfeited.

 

(v)                            Severance Provisions of this Agreement
Control.              The provisions of this Section 5 shall supersede in their
entirety any severance payment provisions in any severance plan, policy, program
or other arrangement maintained by the Company.

 

6.                                      Restrictive Covenants.

 

(a)                                 Non-Competition. The Executive hereby agrees
that, during the Term and the Restricted Period, the Executive shall not,
directly or indirectly engage in, have any interest in (including, without
limitation, through the investment of capital or lending of money or property),
or manage, operate or otherwise render any services to, any Person, whether on
his own or in association with others, as a principal, director, officer,
employee, agent, representative, partner, member, security holder, consultant,
advisor, independent contractor, owner, investor, participant or in any other
capacity, that engages in (either directly or through any subsidiary or
affiliate thereof) any business or activity: (i) relating to the design,
development, manufacture, engineering, building, assembly, marketing, supply,
sale or provision of a Competitive Product (as defined below) anywhere in the
world; or (ii) which the Company engages in or has taken active steps to engage
in or acquire. For purposes of this Agreement, the term “Competitive Product”
shall mean any product or component thereof, product line or service that has
been, is being, or during the Executive’s term of employment may be, designed,
developed, manufactured, engineered, built, assembled, marketed, supplied, sold
or provided by any Person other than the Company and that is of the same general
type, performs a similar function, or is used for the same general purpose as a
Company product, product line, component thereof, or service, including, without
limitation, boats primarily used for towed watersports (such as waterskiing,
wakeboarding, wakesurfing, etc.), bay boats, deck boats or offshore center
console boats. Notwithstanding the foregoing, the Executive shall be permitted
to acquire a passive stock or equity interest in such a business; provided that
such stock or other equity interest acquired is not more than five percent (5%)
of the outstanding interest in such business.

 

(b)                                 Non-Solicitation of Company Employees. The
Executive hereby agrees that, during the Term and the Restricted Period, the
Executive shall not, directly or indirectly, either for himself or on behalf of
any other Person: (i) Solicit (as defined below) any Person who

 

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was employed by the Company at any time during the twenty-four (24) month period
immediately prior to the date of termination of employment or who thereafter
becomes employed by the Company (a “Company Employee”); or (ii) participate in
any way in a decision to hire a Company Employee. For purposes of this
Agreement, the term “Solicit” shall mean to recruit, offer, induce, or otherwise
persuade (or to assist or encourage any other Person to do so), directly or
indirectly, a Company Employee to terminate his or her employment with the
Company and/or to perform services for the Executive or for any other Person,
whether as a principal, director, officer, employee, agent, representative,
partner, member, security holder, consultant, advisor, independent contractor,
owner, investor, participant or in any other capacity.

 

(c)                                  Non-Solicitation of Company Customers,
Vendors, Etc. The Executive hereby agrees that, during the Term and the
Restricted Period, the Executive shall not, directly or indirectly, either for
himself or on behalf of any other Person: (i) call upon, accept business from,
or solicit the business of any Person who is or who had been at any time during
the twenty- four (24) month period immediately prior to the date of termination
of employment, a customer, supplier or vendor of the Company; provided, however,
that the Executive may contact any such supplier or vendor where such contact
does not relate to the design, development, manufacture, engineering, building,
assembly, marketing, supply, sale or provision of a Competitive Product; or
(ii) divert business, supplies, services or materials from, or otherwise
interfere with, the Company’s business relationship with any of the Company’s
customers, suppliers or vendors. The Executive further agrees that if any such
customer, supplier or vendor contacts the Executive during the Term or the
Restricted Period in respect of doing business with the Executive, the Executive
will advise such customer, supplier or vendor of the restrictions on his ability
to do business with such customer, supplier or vendor contained herein.

 

(d)                                 Company Marks. The Executive shall not at
any time, directly or indirectly, use or purport to authorize any Person to use
any name, mark, logo, trade dress or identifying words or images which are the
same as or similar to those used at any time by the Company in connection with
any product or service, whether or not such use would relate to a Competitive
Product.

 

(e)                                  Confidentiality of the Company’s
Proprietary Information. Except as the Executive reasonably and in good faith
determines to be required in the faithful performance of the Executive’s duties
hereunder or in accordance with Section 6(g), the Executive shall, during his
term of employment and thereafter, maintain in confidence and shall not directly
or indirectly, use, disseminate, disclose or publish, or use for the Executive’s
own benefit or the benefit of any other Person, any confidential or proprietary
information or trade secrets of or relating to the Company, including, without
limitation, information with respect to the Company’s operations, processes,
protocols, products, inventions, business practices, finances, principals,
vendors, suppliers, customers, potential customers, marketing methods, costs,
prices, contractual relationships, regulatory status, compensation paid to
employees or other terms of employment (“Proprietary Information”), or deliver
to any other Person, any document, record, notebook, computer program or similar
repository of or containing any such Proprietary Information. The Executive’s
obligation to maintain and not use, disseminate, disclose or publish, or use for
the Executive’s benefit or the benefit of any other Person, any Proprietary
Information after the date of termination of employment will continue so long as
such Proprietary Information is not, or has not by legitimate means become,
generally known and in the public domain (other than by means of the Executive’s
direct or indirect disclosure of such

 

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Proprietary Information) and continues to be maintained as Proprietary
Information by the Company. The parties hereby stipulate and agree that as
between them, the Proprietary Information identified herein is important,
material and affects the successful conduct of the businesses of the Company
(and any successor or assignee of the Company).

 

(f)                                   Return of Proprietary Information &
Company Property. Upon termination of the Executive’s employment with the
Company for any reason, the Executive will promptly deliver to the Company
(i) all correspondence, drawings, manuals, letters, notes, notebooks, reports,
programs, plans, proposals, financial documents, or any other documents that are
Proprietary Information, including all physical and digital copies thereof, and
(ii) all other Company property (including, without limitation, any personal
computer or wireless device and related accessories, keys, credit cards and
other similar items) which is in his possession, custody or control.

 

(g)                                 Response to Legal Document Requests. The
Executive may respond to a lawful and valid subpoena or other legal process but
shall give the Company the earliest possible notice thereof, and shall, as much
in advance of the return date as possible, make available to the Company and its
counsel the documents and other information sought, and shall assist such
counsel in resisting or otherwise responding to such process.

 

(h)                                 Non-Disparagement. The Executive agrees not
to disparage the Company, any of its products or practices, or any of its
directors, officers, agents, representatives, equity holders or affiliates,
either orally or in writing, at any time; provided that the Executive may confer
in confidence with the Executive’s legal representatives and make truthful
statements as required by law.

 

(i)                                    Delivery of Covenants to Potential Future
Employers. Prior to accepting other employment or any other service relationship
during the Restricted Period, the Executive shall provide a copy of this
Section 6 to any recruiter who assists the Executive in obtaining other
employment or any other service relationship and to any employer or other Person
with which the Executive discusses potential employment or any other service
relationship.

 

(j)                                    Judicial Modification & Interpretation;
Tolling of Time Periods Due  to Breach by Executive. In the event the terms of
this Section 6 shall be determined by any court of competent jurisdiction to be
unenforceable by reason of its extending for too great a period of time or over
too great a geographical area or by reason of its being too extensive in any
other respect, it will be interpreted to extend only over the maximum period of
time for which it may be enforceable, over the maximum geographical area as to
which it may be enforceable, or to the maximum extent in all other respects as
to which it may be enforceable, all as determined by such court in such action.
Any breach or violation by the Executive of the provisions of this Section 6
shall toll the running of any time periods set forth in this Section 6 for the
duration of any such breach or violation.

 

(k)                                 Company. As used in this Section 6, the term
“Company” shall include MasterCraft, NauticStar, their parent and related
entities, and any of their direct or indirect subsidiaries.

 

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7.                                 Injunctive Relief. The Executive recognizes
and acknowledges that a breach of the covenants contained in Section 6 will
cause irreparable damage to the Company and its goodwill, the exact amount of
which will be difficult or impossible to ascertain, and that the remedies at law
for any such breach will be inadequate. Accordingly, the Executive agrees that
in the event of a breach of any of the covenants contained in Section 6, in
addition to any other remedy which may be available at law or in equity, the
Company will be entitled to specific performance and injunctive relief (without
any requirement to post a bond or other security). In the event action is
brought by the Company to enforce the provisions of Section 6, if the Company
prevails in such action or if there is no prevailing party in such action, then
the Executive shall pay, or shall promptly reimburse the Company for, the costs
incurred by the Company in such action (including reasonable attorneys’ fees and
expenses). The provisions of Section 6 and Section 7 of this Agreement shall
survive any expiration or termination of this Agreement.

 

8.                                 Section 409A.

 

(a)                                 General. The parties hereto acknowledge and
agree that, to the extent applicable, this Agreement shall be interpreted in
accordance with, and incorporate the terms and conditions required by,
Section 409A. Notwithstanding any provision of this Agreement to the contrary,
in the event that the Company determines that any amounts payable hereunder will
be immediately taxable to the Executive under Section 409A, the Company reserves
the right to (without any obligation to do so or to indemnify the Executive for
failure to do so) (i) adopt such amendments to this Agreement or adopt such
other policies and procedures (including amendments, policies and procedures
with retroactive effect) that it determines to be necessary or appropriate to
preserve the intended tax treatment of the benefits provided by this Agreement,
to preserve the economic benefits of this Agreement and to avoid less favorable
accounting or tax consequences for the Company and/or (ii) take such other
actions it determines to be necessary or appropriate to exempt the amounts
payable hereunder from Section 409A or to comply with the requirements of
Section 409A and thereby avoid the application of penalty taxes thereunder.
Notwithstanding anything herein to the contrary, no provision of this Agreement
shall be interpreted or construed to transfer any liability for failure to
comply with the requirements of Section 409A from the Executive or any other
individual to the Company or any of its affiliates, employees or agents.

 

(b)                                 Separation from Service under Section 409A.
Notwithstanding anything herein to the contrary: (i) no termination or other
similar payments and benefits hereunder that are considered “nonqualified
deferred compensation” within the meaning of Section 409A shall be payable upon
the Executive’s termination of employment hereunder unless such termination
constitutes a “separation from service” within the meaning of
Section 1.409A-1(h) of the Department of Treasury Regulations; (ii) if the
Executive is deemed at the time of the Executive’s separation from service to be
a “specified employee” for purposes of Section 409A(a)(2)(B)(i) of the Code, to
the extent delayed commencement of any portion of any, termination or other
similar payments and benefits to which the Executive may be entitled hereunder
(after taking into account all exclusions applicable to such payments or
benefits under Section 409A) is required in order to avoid a prohibited
distribution under Section 409A(a)(2)(B)(i) of the Code, such portion of such
payments and benefits shall not be provided to the Executive prior to the
earlier of (x) the expiration of the six (6) month period measured from the date
of the Executive’s “separation from service” with the Company (as such term is

 

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defined in the Department of Treasury Regulations issued under Section 409A) or
(y) the date of the Executive’s death; provided that upon the earlier of such
dates, all payments and benefits deferred pursuant to this
Section 8(b)(ii) shall be paid in a lump sum to the Executive, and any remaining
payments and benefits due hereunder shall be provided as otherwise specified
herein; (iii) the determination of whether the Executive is a “specified
employee” for purposes of Section 409A(a)(2)(B)(i) of the Code as of the time of
the Executive’s separation from service shall be made by the Company in
accordance with the terms of Section 409A (including, without limitation,
Section 1.409A-1(i) of the Department of Treasury Regulations and any successor
provision thereto); (iv) to the extent that any installment payments under this
Agreement are deemed to constitute “nonqualified deferred compensation” within
the meaning of Section 409A, for purposes of Section 409A (including, without
limitation, for purposes of Section 1.409A-2(b)(2)(iii) of the Department of
Treasury Regulations), each such payment that the Executive may be eligible to
receive under this Agreement shall be treated as a separate and distinct
payment; (v) to the extent that any reimbursements or corresponding in-kind
benefits provided to the Executive under this Agreement are deemed to constitute
“deferred compensation” under Section 409A, such reimbursements or benefits
shall be provided reasonably promptly, but in no event later than December 31 of
the year following the year in which the expense was incurred, and in any event
in accordance with Section 1.409A-3(i)(1)(iv) of the Department of Treasury
Regulations; and (vi) the amount of any such payments or expense reimbursements
in one calendar year shall not affect the expenses or in-kind benefits eligible
for payment or reimbursement in any other calendar year, other than an
arrangement providing for the reimbursement of medical expenses referred to in
Section 105(b) of the Code, and the Executive’s right to such payments or
reimbursement of any such expenses shall not be subject to liquidation or
exchange for any other benefit.

 

9.                                 Assignment & Successors; Binding Effect. The
Company may assign its rights and obligations under this Agreement to any
entity, including any successor to all or substantially all the assets of the
Company, by merger or otherwise, and may assign or encumber this Agreement and
its rights hereunder as security for indebtedness of the Company and its
affiliates. The Executive may not assign the Executive’s rights or obligations
under this Agreement to any individual or entity. This Agreement shall be
binding upon and inure to the benefit of the Company, the Executive and their
respective successors, assigns, personnel and legal representatives, executors,
administrators, heirs, devisees, and legatees, as applicable.

 

10.                          Governing Law; Forum. This Agreement shall be
governed, construed, interpreted and enforced in accordance with the substantive
laws of the State of Tennessee, without reference to the principles of conflicts
of law of Tennessee or any other jurisdiction, and where applicable, the laws of
the United States. The parties further expressly agree that jurisdiction and
venue for any actions concerning the enforcement, construction or interpretation
of this Agreement shall be in the Chancery Court for Knox County, Tennessee, or
the Federal District Court for the Eastern District of Tennessee, Northern
Division, sitting in Knoxville, Tennessee.

 

11.                          Severability. If any provision of this Agreement
shall be held invalid, illegal or unenforceable, the validity, legality or
enforceability of the other provisions shall not be affected thereby, and if at
any time any one or more of the provisions of this Agreement (or any Section,
sub-section or any part thereof) is held to be or becomes void or otherwise
unenforceable for any reason, the parties hereto shall use their best efforts to
agree upon a replacement for such invalid

 

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or unenforceable provision in terms which correspond as closely as possible to
the original provision. However, if such replacement is unable to be
accomplished then the same will be deemed omitted, and the validity and/or
enforceability of the remaining provisions of this Agreement will not in any way
be affected or impaired thereby.

 

12.                          Notices. Any notice, request, claim, demand,
document and other communication hereunder to any party hereto shall be
effective upon receipt (or refusal of receipt) and shall be in writing and
delivery may be in person, by mail, by electronic mail, by facsimile
transmission, or by nationally-recognized courier service. Notice by mail shall
be properly addressed with proper postage affixed and (i) if sent first class,
with delivery deemed to occur five (5) days after mailing or, (ii) if sent
registered, certified or express return receipt requested, with delivery deemed
to have occurred on the date shown on the return receipt. Notice sent by any of
the other methods of delivery shall be deemed effective (i) when delivered, if
delivered personally; (ii) when sent (with confirmation received), if sent by
electronic mail or facsimile transmission on a business day; (iii) on the first
business day after dispatch (with confirmation received), if sent by electronic
mail or facsimile transmission on a day other than a business day; and (iv) on
the first business day after dispatch, if sent by overnight air courier. Notices
shall be sent to the following address (or at any other address as any party
hereto shall have specified by notice in writing to the other party hereto):

 

If to the Company:

 

MCBC Holdings, Inc.

100 Cherokee Cove Drive

Vonore, Tennessee 37885

Attn: Vice President of Human Resources

Facsimile: (423) 884-2222

E-Mail: charlene.hampton@mastercraft.com

 

with a copy to:

 

Egerton, McAfee, Armistead & Davis, P.C.

900 S. Gay Street, 14th Floor

Knoxville, Tennessee 37902

Attn: Norman G. Templeton, Esq.

Facsimile: (865) 525-5293

E-Mail: ntempleton@emlaw.com

 

If to the Executive:

 

At the then-current address in the Company’s records.

 

13.                          Counterparts; Electronic Delivery. This Agreement
may be executed in two (2) or more counterparts, each of which shall constitute
an original, but all of which together shall constitute one and the same
instrument. It shall be permissible for any party, after execution of this
Agreement, to transmit and deliver a copy of the Agreement as executed by that
party, to the other party hereto (or their respective counsel) by facsimile,
electronic mail or any other electronic means, and delivery by any such
electronic means shall constitute delivery of the executed Agreement for all
purposes and shall be legally binding on the party transmitting the Agreement by
any such means.

 

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14.                          Entire Agreement. The terms of this Agreement
(together with any other agreements and instruments contemplated hereby or
referred to herein) are intended by the parties hereto to be the final
expression of their agreement with respect to the subject matter hereof and may
not be contradicted by evidence of (and supersede) any prior or contemporaneous
agreement with respect to the subject matter hereof (including, without
limitation, those certain prior Employment Agreements between the Company and
the Executive dated July 26, 2012 and July 1, 2015). The parties hereto further
intend that this Agreement shall constitute the complete and exclusive statement
of its terms and that no extrinsic evidence whatsoever may be introduced in any
judicial, administrative, or other legal proceeding to vary the terms of this
Agreement.

 

15.                          Amendments; Waivers. This Agreement may not be
modified, amended, or terminated except by an instrument in writing, signed by
the Executive and a duly authorized officer of the Company and approved by the
Board, which expressly identifies the amended provision of this Agreement. By an
instrument in writing similarly executed and approved by the Board, the
Executive or a duly authorized officer of the Company may waive compliance by
the other party or parties hereto with any provision of this Agreement that such
other party was or is obligated to comply with or perform; provided, however,
that such waiver shall not operate as a waiver of or estoppel with respect to,
any other or subsequent failure to comply or perform. No failure to exercise and
no delay in exercising any right, remedy, or power hereunder shall preclude any
other or further exercise of any other right, remedy, or power provided herein
or by law or in equity.

 

16.                          No Inconsistent Actions. The parties hereto shall
not voluntarily undertake or fail to undertake any action or course of action
inconsistent with the provisions or essential intent of this Agreement.
Furthermore, it is the intent of the parties hereto to act in a fair and
reasonable manner with respect to the interpretation and application of the
provisions of this Agreement.

 

17.                          Construction. This Agreement shall be deemed
drafted equally by both of the parties hereto. Its language shall be construed
as a whole and according to its fair meaning. Any presumption or principle that
the language is to be construed against any party hereto shall not apply. The
headings in this Agreement are only for convenience and are not intended to
affect construction or interpretation. Any references to paragraphs,
subparagraphs, sections or subsections are to those parts of this Agreement,
unless the context clearly indicates to the contrary. Also, unless the context
clearly indicates to the contrary, (a) the plural includes the singular and the
singular includes the plural; (b) “and” and “or” are each used both
conjunctively and disjunctively; (c) “any,” “all,” “each,” or “every” means “any
and all,” and “each and every”; (d) “includes” and “including” are each “without
limitation”; (e) “herein,” “hereof,” “hereunder” and other similar compounds of
the word “here” refer to the entire Agreement and not to any particular
paragraph, subparagraph, section or subsection; and (f) all pronouns and any
variations thereof shall be deemed to refer to the masculine, feminine, neuter,
singular or plural as the identity of the entities or persons referred to may
require.

 

18.                          Withholding. The Company shall be entitled to
withhold from any amounts payable under this Agreement, any federal, state,
local or foreign withholding or other taxes or

 

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charges which the Company is required to withhold. The Company shall be entitled
to rely on an opinion of counsel if any questions as to the amount or
requirement of withholding shall arise.

 

19.                          Absence of Conflicts. The Executive hereby
represents (i) that from and after the Effective Date the performance of the
Executive’s duties contemplated hereunder will not breach any other agreement to
which the Executive is a party and (ii) that Executive has provided the Company
with true and correct copies of any agreements to which Executive is a party
that could reasonably be construed so as to limit the performance of the
Executive’s duties hereunder. To the extent requested by the Company, the
Executive shall provide evidence reasonably satisfactory to the Company that
demonstrates the Executive’s ability to perform his duties hereunder without
breaching any other agreement to which the Executive may be a party.

 

20.                          Executive Acknowledgement. The Executive
acknowledges that the Executive has read and understands this Agreement, is
fully aware of its legal effect, has not acted in reliance upon any
representations or promises made by the Company other than those contained in
writing herein, and has entered into this Agreement freely based on the
Executive’s own judgment.

 

21.                          Survival. Neither the expiration or termination of
the Term nor the termination of the Executive’s employment with the Company
shall impair the rights or obligations of any party hereto which shall have
accrued prior to such expiration or termination (including, without limitation,
the Company’s right to enforce the restrictive covenants contained in Section 6
of this Agreement).

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective as
of the date and year first above written.

 

 

 

MCBC HOLDINGS, INC.:

 

 

 

 

 

 

 

By:

/s/ Timothy M. Oxley

 

 

Timothy M. Oxley

 

 

CFO, Secretary & Treasurer

 

 

 

 

 

 

EXECUTIVE:

 

 

 

 

 

/s/ Terry D. McNew

 

Terry D. McNew, individually

 

Signature Page to Employment Agreement for Terry D. McNew

 

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