Exhibit - 10.2
SENIOR EXECUTIVE AGREEMENT
          WHEREAS, Gary Rada (the “Executive”) is the President and Chief
Executive Officer of Factory Card & Party Outlet Corp., a Delaware corporation
(the “Company”);
          WHEREAS, the Executive entered into an employment agreement with
Factory Card Outlet of America, Ltd., which is a wholly-owned subsidiary of the
Company, dated as of December 23, 2004, as amended on December 9, 2005, which
remains in effect on the date hereof (the “Employment Agreement”);
          WHEREAS, the Executive may, under certain circumstances, become a
participant in the Company’s Amended and Restated Executive Severance Plan (the
“Executive Severance Plan”) (it being understood that, in no event will the
Executive become such a participant for as long as the Executive is also a party
to the Employment Agreement);
          WHEREAS, in connection with the proposed acquisition (the “Merger”) of
the Company pursuant to an Agreement and Plan of Merger (the “Merger Agreement”)
dated as of September 17, 2007, by and among Amscan Holdings, Inc., a Delaware
corporation (“Parent”), Amscan Acquisition, Inc., a Delaware corporation and a
direct wholly owned subsidiary of Parent (“Newco”) and the Company, the Company
shall become a wholly owned subsidiary of Parent; and
          WHEREAS, the Employment Agreement and the Executive Severance Plan
shall remain in effect on and after the consummation of the transactions
contemplated by the Merger Agreement, with such changes as may be effected by
this Agreement, and, in connection therewith, the Executive shall continue to
serve as President and Chief Executive Officer of the Company and as a member of
its Board of Directors.
          NOW THEREFORE, in consideration of the mutual promises contained
herein, the Executive, Parent and the Company agree as follows:
          1. The Executive shall continue employment with the Company in
accordance with the terms and conditions of the Employment Agreement following
the closing of the Merger (the “Closing”), it being understood that the Company
shall thereupon be a direct or indirect subsidiary of Parent and/or AAH Holdings
Corporation (“Holdings”). The Executive shall report to the President and Chief
Executive Officer of Holdings (“Holdings’ CEO”). During the term of this
Agreement, the Executive shall serve as a member of the Board of Directors of
the Company. The Executive hereby agrees that changes to his duties,
responsibilities and authorities caused solely and as a direct and proximate
result of the Company becoming a privately held subsidiary of Parent and/or
Holdings will not in and of itself constitute “Good Reason” within the meaning
of Section 10(b) of the Employment Agreement or within the meaning of
Section 1.2 of the Executive Severance Plan. The Executive will have such
duties, responsibilities and authorities which are customary and normally
associated with those of chief executive officers of retail businesses of
similar size in the United States. For the avoidance of doubt, Executive’s
duties, responsibilities and authority will include, but not be limited to: (i)

 

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preparation, development and recommendation to Holdings’ CEO of budgets of the
Company, (ii) preparation, development and recommendation to Holdings’ CEO of
business and staffing plans of the Company, (iii) implementation of budgets,
business plans and staffing plans, (iv) selection, retention and termination of
Company employees, including officers following consultation with Holdings’ CEO,
and (v) selection, retention and termination of outside consultants,
contractors, professionals and service providers to the Company. The Executive
agrees that the material employee benefit plans, programs and arrangements
listed on Exhibit A to be provided by the Company, Parent or Holdings to the
Executive are reasonably acceptable to the Executive; provided, however,
amendments or modifications to the material employee benefit plans, programs and
arrangements listed on Exhibit A that apply to senior executives of the Company,
Parent and Holdings generally (whether or not they also apply to other
participants) shall not result in a breach of this Agreement or constitute “Good
Reason” under the Employment Agreement.
          2. On the date of the Closing, Parent shall cause to be granted to the
Executive nonqualified stock options to purchase 30 shares of common stock of
Holdings (such options, the “New Options”), at an exercise price equal to the
fair market value of a share of common stock at the date of grant, which is
expected to be $17,500 per share. One-half (50%) of the New Options shall be
subject to vesting in equal annual installments over a period of 5 years
following the date of grant, and the remaining one-half (50%) of the New Options
shall be subject to performance vesting, in each case on the terms set forth in
the attached form of Option Agreements (attached as Exhibit B-1 and
Exhibit B-2). Such Option Agreements shall be granted under and pursuant to the
terms of the AAH Holdings Corporation 2004 Equity Incentive Plan (the “AAH
Option Plan”), in or substantially in the form of the attached options
certificates. Notwithstanding anything else in the Executive Severance Plan
(including Section 3.5 thereof) or in any other agreement, the New Options shall
vest on such terms as provided in such Option Agreements.
          3. The Executive’s Employment Agreement is hereby amended as follows:
          (i) Section 2 of the Employment Agreement is hereby amended by
substituting “April 7, 2010” for “April 7, 2009”;
          (ii) Section 10(a) of the Employment Agreement is hereby amended by
replacing the parenthetical:
          “(the ‘Severance Period’; provided that if the Executive’s employment
hereunder is terminated during the Term (i) by the Corporation other than for
Cause, or (ii) by the Executive for Good Reason pursuant to a Notice of
Termination and, in the case of clause (i) or (ii), such termination occurs
after a Change of Control, then the ‘Severance Period’ shall be thirty-six
(36) months)”
          with the following parenthetical:
          “(the ‘Severance Period’; provided that if the Executive’s employment
hereunder is terminated during the Term but prior to April 8, 2009 (i) by the
Corporation other than for

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Cause, or (ii) by the Executive for Good Reason pursuant to a Notice of
Termination and, in the case of clause (i) or (ii), such termination occurs
after a Change of Control, then the ‘Severance Period’ shall be thirty-six
(36) months)”;
          and
          (iii) The characters “(a)” in Section 7(a) of the Employment Agreement
are hereby deleted and Section 7(b) of the Employment Agreement is hereby
deleted in its entirety.
          4. Contemporaneous with the execution of this Agreement, the Company
shall amend the Amended and Restated Executive Severance Plan to be in the form
attached hereto as Exhibit C (subject to the terms of this Agreement, including
the last sentence of Section 2).
          5. The parties hereto acknowledge and agree that in the event the
Executive is given a Notice of Non-Renewal (as defined in the Employment
Agreement), then, on and after expiration of the Term (as defined in the
Employment Agreement), the Executive shall participate in the Executive
Severance Plan as in effect on the date hereof in accordance with the terms
thereof (subject to the terms of this Agreement, including the last sentence of
Section 2) and shall not be entitled to benefits pursuant to the Employment
Agreement. For the avoidance of doubt, the giving of a Notice of Non-Renewal is
neither (i) a no Cause termination or (ii) a termination for Good Reason for
purposes of the Employment Agreement; provided, however, the Executive shall be
entitled to severance pay and benefits under the Executive Severance Plan in the
event of the Company’s decision not to continue Executive’s employment upon the
expiration of the Term.
          6. This Agreement shall become effective on the Closing (as defined in
the Merger Agreement) and shall be of no force or effective if the Merger
Agreement is terminated in accordance with its terms.
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          IN WITNESS WHEREOF, the parties have executed this Agreement,
effective as of this 17th day of September, 2007.

            Amscan Holdings, Inc.
      By:   /s/ Robert J. Small         Name:   Robert J. Small         Title:  
Chairman of the Board        Factory Card and Party Outlet Corp.
      By:   /s/ Timothy J. Benson         Name:   Timothy J. Benson       
Title:   Chief Financial Officer        Factory Card Outlet of America, Ltd.
      By:   /s/ Timothy J. Benson         Name:   Timothy J. Benson       
Title:   Chief Financial Officer        Executive
             /s/ Gary Rada                  

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