Exhibit 10

 

Employment Agreement

 

1. Recitals.

(a) Cedar Fair, L.P., a publicly traded Delaware limited partnership, is
affiliated with several corporations and partnerships including, without
limitation, Cedar Fair Management Company, Magnum Management Corp., Cedar Point
of Michigan, Michigan's Adventure, Inc., Knott's Berry Farm, Cedar Fair and
Boeckling, L.P. (hereinafter collectively referred to as "Cedar Fair" or the
"Company").

(b) Cedar Fair Management Company, an Ohio corporation, manages the day-to-day
activities of, and establishes the long-term objectives for, Cedar Fair. The
Board of Directors of Cedar Fair Management Company (the "Board") wishes to
enter into an employment agreement with, or to cause another affiliate to enter
into an employment agreement with, Richard L. Kinzel (the "Executive") to be
effective as of June 1, 2003 (the "Agreement").

(c) The Executive has held the position of President and Chief Executive Officer
of Cedar Fair since 1986. During his tenure, Executive has consistently met or
surpassed performance goals established by the Board. As the President and Chief
Executive Officer, Executive has consistently improved the operating results of
Cedar Fair.

 a. The Board desires to retain the employment of Executive in his present
    capacity and to assure Cedar Fair of his continued services in this
    capacity. The Board also desires Executive to remain active with Cedar Fair
    after the completion of Executive's employment with Cedar Fair.
 b. Executive desires to remain in the employment of Cedar Fair in his present
    capacity, and to remain active with Cedar Fair, and Executive is committed
    to serve and assist Cedar Fair on the terms provided in this Agreement.

(f) In consideration of the mutual promises contained herein and other good and
valuable consideration, the Executive and Cedar Fair have entered into this
Agreement.

2. Term of Employment.

Except as otherwise provided in this Agreement, Cedar Fair and the Executive
agree that the Executive will remain in the employ of Cedar Fair until January
2, 2008. The "Term of Employment" shall refer to the period commencing on June
1, 2003 and ending on January 2, 2008.

 

3. Nature of Duties.

(a) The Executive agrees to devote his full-time to the business and affairs of
Cedar Fair so as to achieve the goals and objectives set by the Board, and to
use his best efforts to promote the interests of Cedar Fair and to perform
faithfully and efficiently the responsibilities assigned to him in accordance
with the terms of this Agreement. Executive further understands that he is
governed by a duty of loyalty and fidelity to Cedar Fair by virtue of his
position.

(b) Except as otherwise provided herein, Cedar Fair agrees that it will not,
without the Executive's express written consent, (i) assign to the Executive
duties inconsistent with his current position, duties, responsibilities and
status with Cedar Fair, (ii) change his titles or offices as currently in
effect. As part of a succession planning program at Cedar Fair, effective
January 1, 2005, Executive, subject to Board approval, shall appoint a Chief
Operating Officer.

4. Board Membership.

Executive is currently Chairman of the Board of Directors. As part of a
succession planning program at Cedar Fair, Executive shall continue to be
appointed to Chairman of the Board until December 30, 2008 provided he is
elected a member of the Board. Thereafter, Executive will serve as member of the
Board for a period of at least two more years provided he is elected to the
Board.

5. Compensation.

(a) Base Salary. As compensation for Executive's services, Cedar Fair shall pay
to the Executive during the term of this Agreement an annual salary ("Base
Salary"). The Executive's Base Salary shall be no less than $875,000 per year
and may be adjusted upwards each year in an amount determined by the Board.

(b) Incentive Compensation. During the Term of Employment, Cedar Fair agrees
that Executive will be eligible to participate in the Corporate Officers
Incentive Compensation Plan, the Senior Management Long-Term Incentive
Compensation Plan and Equity Incentive Plans and any amendments thereto and any
new Plan established subsequent to the effective date of this Agreement. Cedar
Fair agrees that during the Terms of Employment, Executive shall participate in
the various incentive plans on terms no less favorable then provided other
senior managers and/or officers of Cedar Fair.

6. Fringe Benefits.

The fringe benefit plans currently maintained and provided by Cedar Fair in
which the Executive will be eligible to participate upon the execution of this
Agreement are listed in Schedule A hereto. Cedar Fair agrees that Executive
shall be eligible to participate in the fringe benefit plans and other benefit
programs on terms no less favorable than provided other senior managers and/or
officers of Cedar Fair.

7. Business Expenses and Perquisites.

Reasonable travel, entertainment and other business expenses incurred by
Executive in the performance of his duties hereunder shall be reimbursed by
Cedar Fair in accordance with Cedar Fair's policies as in effect from time to
time.

8. Termination by Cedar Fair Other Than for Cause.

(a) If Cedar Fair shall terminate the Executive's employment prior to January 2,
2008, other than pursuant to Section 11 hereof, then Cedar Fair shall pay to the
Executive in a lump sum on the twentieth business day following the Date of
Termination, the following amounts:

(i) The Executive's Base Compensation Salary through the Date of Termination;
and

(ii) In lieu of any further Base Salary payments for periods subsequent to the
Date of Termination, an amount equal to the present value of Executive's Base
Salary that Executive would have received had he remained employed with Cedar
Fair through the Term of Employment; and

(iii) In lieu of any further Incentive Compensation, an amount equal to the
present value of Incentive Compensation that Executive would have received had
he remained employed through the Term of Employment. For purposes of this
provision, in calculating the amount of Incentive Compensation Executive would
have received, the weighted average Incentive Compensation received by Executive
over the prior three years shall be multiplied by the number of years (or
prorations thereof) remaining from the Date of Termination through January 2,
2008; and

(iv) Executive shall become immediately vested in any Award, Option, Unit
Appreciation Right, Restricted Unit Award, Performance Unit, Distribution
Equivalent, Other Unit Award, or any other right, interest or option relating to
Units or other securities of Cedar Fair issued to Executive, pursuant to the
2000 Equity Incentive Plan, the 2002 Long Term Plan or any amendment thereto, or
any new Plan established subsequent to the effective date of this Agreement, and
shall be entitled to exercise any Award, Option, Unit Appreciation Right,
Restricted Unit Award, Performance Unit, Distribution Equivalent, Other Unit
Award, or any other right, interest or option relating to Units or other
securities, at any time on or before March 1, 2010.

 

9. Termination Upon Executive's Death.

In the event of Executive's death, this Agreement shall terminate and Cedar Fair
shall pay to Executive's estate any compensation and benefits earned but not so
yet paid as of the date of Executive's death. Cedar Fair, at its expense, shall
in addition to any other life insurance currently provided to Executive, shall
purchase a two million dollar term life insurance policy on the life of the
Executive and permit him to designate the beneficiary. The term life insurance
shall remain in effect for a period of twelve years. For purposes of this
Agreement, upon his death, Executive's employment shall be deemed to have
terminated by Cedar Fair other than for cause as set forth in Paragraph 8 and
Executive and/or his estate shall be entitled to the compensation and benefits
provided in Paragraph 8(a)(iv).

10. Termination for Disability.

Cedar Fair may terminate this Agreement for "Disability" if the Executive is
"Disabled." For purposes of this Agreement, the Executive shall be considered
Disabled only if, as a result of his incapacity due to physical or mental
illness, he shall have been absent from his duties with Cedar Fair on a
full-time basis for a period of six (6) consecutive months and a physician
selected by Cedar Fair with the consent of the Executive is of the opinion that
the Executive is suffering from "Total Disability" as defined in any disability
insurance program maintained by Cedar Fair. Any termination of employment
pursuant to the provision shall be deemed a termination by Cedar Fair other than
for cause as set forth in Paragraph 8 and Executive shall be entitled to
compensation and benefits as provided therein. Monetary payments received by
Executive from any long term or short term disability plan maintained by Cedar
Point shall be used to reduce any salary payments made by Cedar Fair pursuant to
this Agreement.

11. Termination for Cause.

(a) Cedar Fair may terminate the Executive's employment for Cause. For the
purposes of this Agreement, "Cause" shall mean (i) Executive's conviction of, or
plea of guilty or nolo contendere to a felony or a crime of moral turpitude;
(ii) upon the willful and continued failure by the Executive to substantially
perform his duties with Cedar Fair which failure results in material injury or
damage, including damage to the reputation of Cedar Fair; (iii) the failure of
Executive to comply with the provisions of Paragraph 14 and 15 hereof; (iv)
intentional theft or embezzlement from Cedar Fair; (v) the commission of a
fraudulent act or practice by the Executive affecting Cedar Fair; or (vi) an act
of gross negligence or gross misconduct that relates to the affairs of Cedar
Point. Notwithstanding the foregoing, the Executive's employment shall not be
deemed to have been terminated for cause if this termination took place as a
result of (i) any act or omission the Executive reasonably and in good faith
believed to have been in or not opposed to the best interests of Cedar Fair; or
(ii) any act or omission in respect of which a determination be made that the
Executive met the applicable standard of conduct prescribed for indemnification
or reimbursement or payment of expenses under the Regulation Laws of Cedar Fair
or the laws of the State of Ohio, in each case as in effect at the time of such
act or omission. Further, Executive shall not be deemed to have been terminated
for cause without (1) reasonable written notice ("Cause Notice") to the
Executive and (ii) an opportunity for the Executive, together with his counsel,
to be heard before the Board provided, that such meeting shall occur within
fifteen (15) calendar days of delivery of the Cause Notice.

 a. Cedar Fair shall give the Executive 30 days' written notice of its intention
    to terminate the Executive's employment for Cause and the grounds for its
    decision.
 b. If the Executive's employment shall be terminated for Cause, Cedar Fair
    shall pay the Executive his Base Compensation through the Date of
    Termination and all Incentive Compensation earned but not as yet paid as of
    the Date of Termination. Cedar Fair shall have no further obligations to the
    Executive under this Agreement.
 c. Should a dispute arise between the parties to this Agreement regarding
    whether Executive's employment was terminated for "Cause", and if the
    parties cannot resolve the matter, the parties agree to submit the dispute
    to final and binding arbitration.

    Arbitration shall be conducted by a panel of three (3) arbitrators in
    accordance with the rules of the American Arbitration Association. Within
    twenty (20) days after notice from one party to the other of the notifying
    party's election to arbitrate, each party shall select one (1) arbitrator.
    Within twenty (20) days after the selection of the two (2) arbitrators by
    the parties, said arbitrators shall in turn select a third arbitrator. If
    the two arbitrators cannot agree upon the selection of a third arbitrator,
    the parties agree that the third arbitrator shall be appointed by the
    American Arbitration Association. The three (3) arbitrators shall deliver
    their decision to the parties in writing within ninety (90) days after the
    selection of the third arbitrator. Judgment on such decision may be rendered
    in a court of competent jurisdiction. The costs of the arbitrators shall be
    paid by Cedar Fair. Should the Executive prevail in arbitration, Cedar Fair
    shall reimburse Executive for reasonable costs, expenses and attorney's fees
    incurred by Executive. Should the arbitrators decide that Executive's
    employment was terminated without cause, Executive understands and agrees
    that the arbitrators may only award Executive compensation and benefits
    provided for in Paragraph 8 of this Agreement. Executive expressly waives
    any claims for pain and suffering damages and punitive damages.

    12. Other Benefits Upon Termination.

    Unless the Executive is terminated for Cause, Executive shall receive and be
    eligible to participate, until January 2, 2008, in the Plans, fringe
    benefits and other benefit programs on terms no less favorable than provided
    to other senior managers and officers of Cedar Fair. In the event that
    participation in any such Plan, fringe benefits or other benefit programs is
    barred, Cedar Fair shall arrange to provide the Executive with benefits
    substantially similar to those which he otherwise would have received had he
    remained employed though the Term of Employment.

    13. Retirement.

    As an inducement for Executive to remain employed through the Term of
    Employment, Executive shall receive, in addition to severance and his normal
    and supplemental retirement benefits, lifetime health coverage benefits for
    himself and his spouse. The terms of the coverage shall be the same or
    substantially similar to coverage provided to active employees of Cedar
    Fair. Upon Executive's retirement, regardless of whether Executive has
    remained employed through the Term of Employment, Executive shall become
    immediately vested in any Award, Option, Unit Appreciation Right, Restricted
    Unit Award, Performance Unit, Distribution Equivalent, Other Unit Award, or
    any other right, interest or option relating to Units or other securities
    issued pursuant to the 2000 Equity Incentive Plan, the 2002 Long Term Plan
    or any amendment thereto or any new Plan established subsequent to the
    effective date of this Agreement and shall further be entitled to exercise
    any Award Option, Unit Appreciation Right, Restricted Unit, Award,
    Performance Unit, Distribution Equivalent, Other Unit Award or any other
    right, interest or option relating to Units or other securities, at any time
    on or before March 1, 2010.

    14. Disclosure of Information.

    (a) The Executive acknowledges that it is the policy of Company to maintain
    as secret and confidential all Confidential Information (as defined herein).
    The parties hereto recognize that the services to be performed by the
    Execute pursuant to this Agreement are special and unique, and that by
    reason of his employment by the Company after the effective date, the
    Executive will acquire, or may have acquired, Confidential Information. The
    Executive recognizes that all such Confidential Information is and shall
    remain the sole property of the Company, free of any rights of the
    Executive, and acknowledges that the Company has a vested interest in
    assuring that all such Confidential Information remains secret and
    confidential. Therefore, in consideration of the Executive's employment with
    the Company pursuant to this Agreement, the Executive agrees that at all
    times from after the effective date, he will not, directly or indirectly,
    disclose to any person, firm, company or other entity (other than the
    Company) any Confidential Information, except as specifically required in
    the performance of his duties hereunder, without the prior written consent
    of the Company, except to the extent that (i) any such Confidential
    Information becomes generally available to the public, other than as a
    result of a breach by the Executive of this Section 14 or by any other
    executive officer of the Company subject to confidentiality obligations, or
    (ii) any such Confidential Information becomes available to the Executive on
    a non-confidential basis from a source other than the Company, or its
    executive officers or advisors; provided, that such source is not known by
    the Executive to be bound by a confidentiality agreement with, or other
    obligation of secrecy to, the Company or another party. In addition, it
    shall not be a breach of the confidentiality obligations hereof if the
    Executive is required by law to disclose any Confidential Information;
    provided, that in such case, the Executive shall (a) give the Company the
    earliest notice possible that such disclosure is or may be required and (b)
    cooperate with the Company, at the Company's expense, in protecting to the
    maximum extent legally permitted, the confidential or proprietary nature of
    the Confidential Information which must be so disclosed. The obligations of
    the Executive under this Section 14 shall survive any termination of this
    Agreement. During the Term of Employment the Executive shall exercise all
    due and diligent precautions to protect the integrity of the business plans,
    customer lists, statistical data and compilation, agreements, contracts,
    manuals or other documents of the Company which embody the Confidential
    Information, and upon the expiration or the termination of the Employment
    Term, the Executive agrees that all Confidential Information in his
    possession, directly or indirectly, that is in writing or other tangible
    form (together with all duplicates thereof) will forthwith be returned to
    the Company and will not be retained by the Executive or furnished to any
    person, either by sample, facsimile film, audio or video cassette,
    electronic data, verbal communication or any other means of communication.
    The Executive agrees that the provisions of this Section 14 are reasonably
    necessary to protect the proprietary rights of the Company in the
    Confidential Information and its trade secrets, goodwill and reputation.

    (b) For purposes hereof, the term "Confidential Information" means all
    information developed or used by the Company relating to the Business (as
    herein defined), operations, employees, customers, suppliers and
    distributors of the Company, including, but not limited to, customer lists,
    purchase orders, financial data, pricing information and price lists,
    business plans and market strategies and arrangements and any Strategic Plan
    (as defined herein), all books, records, manuals, advertising materials,
    catalogues, correspondence, mailing lists, production data, sales materials
    and records, purchasing materials and records, personnel records, quality
    control records and procedures included in or relating to the Business or
    any of the assets of the Company and all trademarks, copyrights and patents,
    and applications therefore, all trade secrets, inventions, processes,
    procedures, research records, market surveys and marketing know-how and
    other technical papers. The term "Confidential Information" also includes
    any other information heretofore or hereafter acquired by the Company and
    deemed by it to be confidential. For purposes hereof, the term "Business"
    shall mean (a) the business of amusement and water parks, (b) any other
    business engaged in or being developed (including production of materials
    used in the Company's businesses) by the Company, or being considered by the
    Company, at the time of the Executive's termination, and (c) any joint
    venture, partnership or agency arrangements relating to the businesses
    described in (a) and (b) above.

    (c) Return of Company Property. The Executive agrees that following the
    termination of his employment for any reason, he shall return all property
    of the Company, its subsidiaries, affiliates and any divisions thereof he
    may have managed which is then in or thereafter comes into his possession,
    including, but not limited to, documents, contracts, agreements, plans,
    photographs, books, notes, electronically stored data and all copies of the
    foregoing as well as any automobile or other materials or equipment supplied
    by the Company to the Executive.

    (d) Inventions. Any and all inventions made, developed or created by the
    Executive (whether at the request or suggestion of the Company or otherwise,
    whether alone or in conjunction with others, and whether during regular
    working hours or otherwise) during the period of his employment with the
    Company, which may be directly or indirectly useful in, or relate to, the
    Business of the Company, shall be promptly and fully disclosed by the
    Executive to the Board of Directors of the Company, and shall be the
    Company's exclusive property as opposed to the Executive. The Executive
    shall promptly deliver to the Board of Directors of the Company all papers,
    drawings, models, data and other material relating to any invention made,
    developed or created by him as aforesaid. The Executive hereby assigns any
    and all such inventions to the Company and hereby agrees to execute and
    deliver such agreements, certificates, assignments or other documents as may
    be necessary to effect the assignment to the Company of any and all such
    inventions as contemplated by this Section 14. The Executive shall, upon the
    Company's request and without any payment therefore, execute any documents
    necessary or advisable in the opinion of the Company's counsel to direct
    issuance of patents or copyrights of the Company with respect to such
    inventions as are to be in the Company's exclusive property as against the
    Executive under this Section 14 or to vest in the Company title to such
    inventions as against the Executive, the expense of securing any such patent
    or copyright, to be borne by the Company.

    15. Non-Competition.

    (a) The Executive agrees that, during the Employment Term and during any
    period in which the Executive is receiving benefits from Cedar Fair or if
    longer, for a period of 24 months following the date of termination by the
    Executive of his employment with the Company for any reason (the
    "Noncompetition Period") the Executive will not (A) directly or indirectly,
    own, manage, operate, control or participate in the ownership, management or
    control of, or be connected as an officer, employee, partner, director, or
    otherwise with, or have any financial interest in, or aid or assist anyone
    else in the conduct of, any entity or business (i) in which 10% or more of
    whose annual revenues are derived from a Business as defined above and (ii)
    which conducts business in any locality or region of the United States,
    Canada or Mexico (whether or not such competing entity or business is
    physically located in the United States, Canada or Mexico), where Business
    is being conducted by the Company on the date the Executive's employment is
    terminated hereunder and in each and every area where the Company intends to
    conduct such Business as it expresses such intent in the written strategic
    plan (the "Strategic Plan") developed by the Company as of the date the
    Executive's employment is terminated hereunder (such business, a "Prohibited
    Business") and (B) either personally or by his agent or by letters,
    circulars or advertisements, and whether for himself or on behalf of any
    other person, company, firm or other entity, except in his capacity as an
    Executive of the Company, canvass or solicit, or enter into or effect (or
    cause or authorize to be solicited, entered into or effected), directly or
    indirectly, for or on behalf of himself or any other person, any business
    relating to the services of the type provided by, or orders for business or
    services similar to those provided by, the Company from any person, company,
    firm or other entity who is, or has at any time within two years prior to
    the date of such action been, a customer or supplier of the Company;
    provided, that the restrictions of clause (ii) of this sentence shall also
    apply to any person, company, firm or other entity with whom the Company is
    specifically seeking to develop a relationship as a customer or supplier of
    the Company at the date of such action. Notwithstanding the forgoing, the
    Executive's ownership of securities of a public company engaged in
    competition with the Company not in excess of 5% of any class of such
    securities shall not be considered a breach of the covenants set forth in
    this Section 15 (a) above.

    (b) The Executive agrees that, at all times from after the Effective Date,
    the Executive will not, either personally or by his agent or by letters,
    circulars or advertisements, and whether for himself or on behalf of any
    other person, company, firm or other entity, except in his capacity as an
    Executive of the Company (i) seek to persuade any employee of the Company to
    discontinue his or her status or employment therewith or to become employed
    in a business or activities likely to be competitive with the Business; or
    (ii) solicit or employ any such person at any time within 12 months
    following the date of cessation of employment of such person with the
    Company, in any locality or region of the United States, Canada or Mexico
    and in each and every other area where the Company conducts its Business.

    (c) The Executive expressly agrees and understands that the remedy at law
    for any breach by him of paragraphs 14 and 15 will be inadequate and that
    the damages flowing from such breach are not readily susceptible to being
    measured in monetary terms. Accordingly, it is acknowledged that upon
    adequate proof of a violation by the Executive of any provision of
    paragraphs 14 and 15, the Company shall be entitled to immediate injunctive
    relief and may obtain a temporary order restraining any threatened or
    further bread. Nothing in this paragraphs 14 and 15 shall be deemed to limit
    the Company's remedies at law or in equity for any breach by the Executive
    of any of the provisions of paragraphs 14 and 15 which may be pursued or
    availed of by the Company.

 d. The Executive has carefully considered the nature and extent of the
    restrictions upon the Executive and the rights and remedies conferred upon
    the Company under paragraphs 14 and 15, and hereby acknowledges and agrees
    that the same are reasonable in time and territory, are intended to
    eliminate competition which otherwise would be unfair to the Company, do not
    stifle the inherent skill and experience of the Executive, would not operate
    as a bar to the Executive's sole means of support, are fully required to
    protect the business interests of the Company and do not confer a benefit
    upon the Company disproportionate to the detriment to the Executive.

16. Termination by Executive.

Except for Paragraphs 13, 14, and 15, in the event Executive voluntary resigns
his employment prior to the end of Term of Employment, this Agreement shall
become null and void.

17. Successors, Binding Agreement.

Cedar Fair will require any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the business
and/or assets of Cedar Fair, by agreement in form and substance satisfactory to
the Executive, to expressly assume and agree to perform this Agreement in the
same manner and to the same extent that Cedar Fair would be required to perform
it if no such succession had taken place. Failure of Cedar Fair to obtain such
agreement prior to the effectiveness of any such succession shall be a breach of
this Agreement and shall entitle the Executive to compensation and benefits from
Cedar Fair in the same amount and on the same terms as would apply if the
Executive was terminated other than for cause.

18. Amendment or Modification; Conflicts.

No provisions of this Agreement may be amended modified, waived or discharged
unless such modification, waiver or discharge is agreed to in writing signed by
the Executive and such officer as may be specifically designated by the Board.
In the event there is any conflict or ambiguity between any term or condition
set forth in this Agreement and any term or condition set forth in any Plan,
Incentive Compensation Plan or Program, Equity Incentive Plan or Award,
Retirement Plan, Supplemental Retirement Plan, Severance Plan, Award Agreement,
Fringe Benefit Plan or any other written document, the terms and conditions of
this Agreement shall supersede and control.

 

19. Validity.

The invalidity or unenforceability of any one or more provisions of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, which shall remain in full force and effect. The validity,
interpretation, construction and performance of this Agreement shall be governed
by the laws of the State of Ohio.

20. Counterparts.

This Agreement may be executed in one or more counterparts, each of which shall
be deemed to be an original but all of which together will constitute one and
the same instrument.

CEDAR FAIR L.P.

By: /s/ M. D. Kwiatkowski
Michael D. Kwiatkowski,
Chairman, Compensation Committee

Date: 06/03/03

CEDAR FAIR MANAGEMENT COMPANY

By: /s/ M. D. Kwiatkowski
Michael D. Kwiatkowski,
Chairman, Compensation Committee

Date: 06/03/03

MAGNUM MANAGEMENT CORP.

By: /s/ M. D. Kwiatkowski
Michael D. Kwiatkowski,
Chairman, Compensation Committee

Date: 06/03/03

CEDAR POINT OF MICHIGAN

By: /s/ M. D. Kwiatkowski
Michael D. Kwiatkowski,
Chairman, Compensation Committee

Date: 06/03/03

MICHIGAN'S ADVENTURE, INC.

By: /s/ M. D. Kwiatkowski
Michael D. Kwiatkowski,
Chairman, Compensation Committee

Date: 06/03/03

KNOTT'S BERRY FARM

By: /s/ M. D. Kwiatkowski
Michael D. Kwiatkowski,
Chairman, Compensation Committee

Date: 06/03/03

 

/s/ Richard L. Kinzel

Richard L. Kinzel

 

Date: 06/04/03