EXHIBIT 10.2

 

EMPLOYMENT AGREEMENT

 

This Employment Agreement (this “Agreement”) is effective as of October   , 2007
(the “Effective Date”), and is entered into by and between XXXXXX, an individual
(“Executive”), and Fleetwood Enterprises, Inc., a Delaware corporation (the
“Company”).

 

R E C I T A L S

 

WHEREAS, by entering into this Agreement, the terms of Executive’s employment
with the Company shall be governed by the terms and conditions of this Agreement
and any prior agreement between Executive and the Company or any of the
Company’s affiliated entities relating to Executive’s employment with the
Company or any of its affiliated entities shall be superseded by the terms of
this Agreement except to the extent set forth herein.

 

NOW, THEREFORE, in consideration of the foregoing, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the parties hereto, the parties hereto agree as follows:

 

A G R E E M E N T

 

1.                                      Employment.  As of the Effective Date,
the Company hereby employs Executive to serve in the capacity of
[Title                     ]. The Company’s Board of Directors (the “Board”)
and/or the Company’s Chief Executive Officer (the “CEO”) may provide other
designations of title to Executive as the Board and/or CEO, in their discretion,
may deem appropriate.

 

Executive agrees to perform the duties and functions as assigned by the CEO
and/or by the Board of Directors. Except for legal holidays, vacations and
absences due to temporary illness, Executive shall devote his time, attention
and energies to the business of the Company on a full-time basis. Executive
represents and warrants to the Company that he is under no restriction,
limitation or other prohibition to perform his duties as described herein.

 

2.                                      Employment Compensation And Benefits.

 

(a)                                  Base Salary. Executive’s initial base
salary shall be at the annual rate of XXXXXXXXX (Dollars) ($XXXXXXX) (the “Base
Salary”), which shall be payable at least as frequently as monthly and subject
to deductions and withholdings required by applicable law and as customary in
respect of the Company’s salaried employees. The Company, on the basis of
Executive’s performance and the Company’s financial success and progress, shall
review this salary level at least annually.

 

(b)                                 Incentive Compensation. As additional
compensation to provide incentives for Executive to extend efforts which will
assist in increasing the profits of the Company, Executive shall be eligible to
receive incentive compensation based on achieving individual and organizational
performance objectives in accordance with the terms and conditions of the
Company’s management compensation plan as in effect from time to time.

 

--------------------------------------------------------------------------------

 

(c)                                  Vacation. Executive shall be entitled to
annual vacations in accordance with the Company’s vacation policies in effect
from time to time during the term of this Agreement.

 

(d)                                 Expense Reimbursement. The Company shall
reimburse Executive for all reasonable amounts actually expended by Executive in
the course of performing his duties for the Company and in accordance with any
Company-established guidelines as in effect from time to time where Executive
tenders receipts or other documentation reasonably substantiating the amounts as
required by the Company.

 

(e)                                  Other Benefits. Except as otherwise
provided in this Agreement, Executive shall be entitled to receive all of the
rights, benefits and privileges under any retirement, pension, profit-sharing,
group medical insurance, group dental insurance, group-term life insurance,
disability insurance and other employee benefit plan or program of the Company
which may be now in effect or hereafter adopted, to the extent that Executive is
eligible under and subject to the provisions thereof as in effect from time to
time.

 

3.                                      Termination.

 

(a)                                  At Will. The Company shall employ Executive
at will, and either Executive or the Company may terminate Executive’s
employment with the Company at any time and for any reason, with or without
cause, with or without notice.

 

(b)                                 Qualifying Termination. Executive’s
termination shall be considered a “Qualifying Termination” unless:

 

(i)                                     Executive voluntarily terminates his
employment with the Company and its affiliated companies. Executive, however,
shall not be considered to have voluntarily terminated his employment with the
Company and its affiliated companies if his overall targeted total cash
compensation (base salary plus targeted short term bonus), (TCC), is reduced or
adversely modified in any material respect (unless the reduction or modification
applies generally to similarly situated executives in the Company) or his
position is modified or changed so that he is no longer an officer of the
Company and he elects to terminate his employment within sixty (60) days
following such reduction, modification or change after having given the Company
at least 30 days notice of the same and a reasonable opportunity to cure during
such 30-day notice period.

 

(ii)                                  The termination is on account of
Executive’s death or Disability. “Disability” shall mean a physical or mental
incapacity as a result of which Executive becomes unable to continue the
performance of his responsibilities for the Company and its affiliated companies
and which, at least three (3) months after its commencement, is determined to be
total and permanent by a physician agreed to by the Company and Executive, or in
the event of Executive’s inability to designate a physician, his legal
representative. In the absence of agreement between the Company and Executive,
each party shall nominate a qualified physician and the two physicians so
nominated shall select a third physician who shall make the determination as to
Disability.

 

2

--------------------------------------------------------------------------------

 

(iii)                               Executive is involuntarily terminated for
“Cause.”  For this purpose, “Cause” shall include but not be limited to:

 

(a)                                  Executive’s refusal to comply with a lawful
instruction of the Board or Executive’s immediate supervisor, which refusal is
not remedied by Executive within a reasonable period of time after his receipt
of written notice from the Company identifying the refusal;

 

(b)                                 Executive’s engaging in gross misconduct;

 

(c)                                  Executive’s act or acts of personal
dishonesty which result in Executive’s personal enrichment at the expense of the
Company or any of its affiliated companies; or

 

(d)                                 Executive’s conviction of any misdemeanor
involving an act of moral turpitude or any felony; or

 

(e)                                  Executive’s failure to perform his duties
in a satisfactory manner. Executive must be provided written notice of the
unsatisfactory performance and provided at least ninety (90) days to improve his
performance.

 

(iv)                              Executive ceases to be employed by the Company
due to the sale or acquisition of all of the equity interests in, or
substantially all of the assets of, a subsidiary or division of the Company with
which Executive is affiliated, or in connection with the merger of such a
subsidiary or division, and this Agreement is assumed in writing or by operation
of law by such acquiring or surviving person or entity or an affiliate thereof.

 

(c)                                  Return of Materials. In the event of any
termination of Executive’s employment for any reason whatsoever, Executive shall
promptly deliver to the Company all Company property, including, but not limited
to, documents, data, and other information pertaining to Confidential
Information, as defined below. Executive shall not take with him any documents
or other information, or any reproduction, summary or excerpt thereof,
containing or pertaining to any Confidential Information.

 

4.                                      Change in Control. Concurrently with the
execution of this Agreement, the Company and Executive have also entered into a
Change in Control Agreement of even date herewith (the “Change in Control
Agreement”). The Change in Control Agreement provides for certain rights and
benefits in the event of a “change in control” of the Company (as defined
therein) or termination of employment in connection with a change in control.

 

5.                                      Severance Payment and Benefits.

 

If Executive’s employment is terminated as a result of a Qualifying Termination
as defined in Section 3(b), and if Executive delivers a fully-executed release
and waiver of all claims against the Company in a form reasonably acceptable to
the Company, then, upon expiration of any applicable revocation period contained
in the release and waiver, the Company shall pay or provide Executive the
following Severance Payment and benefits based on Executive’s eligibility as
described below:

 

3

--------------------------------------------------------------------------------

 

(i)                                     As eligible, Executive shall receive the
Severance Payment, as defined below, which shall be payable in equal monthly
installments beginning on the first day of the first full month and continuing
on the first day of each month thereafter during the Severance Period. The
Severance Payment is in lieu of any severance payment benefits which otherwise
may at that time be available under the Company’s applicable policies, other
than the Change in Control Agreement. In the event that Executive shall be
entitled to receive severance compensation under the Change in Control
Agreement, such severance compensation shall be in lieu of and not in addition
to the benefits provided in this Section 5(a).

 

As used herein, “Monthly Severance Payment” shall mean the monthly installment
amount of the Base Salary of Executive at the time of Executive’s termination
plus the monthly average of the short-term incentive payments (quarterly bonus)
actually paid to Executive during the twelve (12) months immediately preceding
Executive’s termination.

 

Executive will be eligible for a number of Monthly Severance Payments based on
the schedule below:

 

Length of Service

 

Monthly Severance Payments

 

 

 

 

 

New hire up to six months

 

0

 

 

 

 

 

Six months up to 12 months

 

3

 

 

 

 

 

12 months up to 18 months

 

6

 

 

 

 

 

18 months up to 24 months

 

9

 

 

 

 

 

24 months or more

 

12

 

 

Length of Service is the number of full months immediately before the date of
Executive’s Qualifying Termination during which Executive has been continuously
employed by the Company or any of its affiliated companies. Each Monthly
Severance Payment shall be subject to deductions and withholdings required by
applicable law. As used herein, “Severance Period” shall mean that period
beginning upon Executive’s Qualifying Termination and ending upon the lapse
thereafter of the number of months equal to the number of Monthly Severance
Payments.

 

(ii)                                  During the Severance Period and to the
extent reasonably practicable, Executive shall be entitled to receive benefits
comparable to those which had been made available to him (including his family)
under the Associate Healthcare Management Plan before the Qualifying
Termination. To the extent reasonably practicable, these benefits shall be
continued to Executive in a comparable manner, at a comparable cost and at a
comparable level as provided to Executive (including his family) immediately
prior to the Qualifying Termination. In some cases, benefits may be converted to
a reasonably similar private plan – provided that the Company pays all
additional costs associated with conversion. The provision of these benefits
shall be earlier terminated or reduced, as applicable, if and to the extent
Executive receives comparable benefits as a result of concurrent coverage
through another program. Participation in all other benefits plans

 

4

--------------------------------------------------------------------------------

 

including group life insurance, personal accident insurance, and disability
insurance, etc., will cease as of the date of termination.

 

(iii)                               Any and all of Executive’s unvested stock
options[, restricted stock or other equity-based awards] shall immediately
become fully vested and exercisable according to the terms and conditions
contained in the equity incentive plan(s) and award agreement(s) pursuant to
which such awards were granted.

 

6.                                      Compliance with Section 409A.
Notwithstanding any provision of this Agreement to the contrary, if, at the time
of Executive’s termination of employment with the Company, Executive is a
“specified employee” as defined in Section 409A of the Code, and one or more of
the payments or benefits received or to be received by Executive pursuant to
this Agreement would become subject to the additional tax under Section
409A(a)(1)(B) of the Code or any other taxes or penalties imposed under Section
409A of the Code (the “Section 409A Taxes”) if provided at the time otherwise
required under this Agreement, no such payment or benefit will be provided under
this Agreement until the earliest of (a) the date which is six (6) months after
Executive’s “separation from service” for any reason, other than death or
“disability” (as such terms are used in Section 409A(a)(2) of the Code) or (b)
the date of Executive’s death, or such shorter period that, as determined by the
Company, is sufficient to avoid the imposition of Section 409A Taxes. The
provisions of this Section 6 shall only apply to the minimum extent required to
avoid Executive’s incurrence of any Section 409A Taxes. In addition, if any
provision of this Agreement would cause Executive to incur any penalty tax or
interest under Section 409A of the Code or any regulations or Treasury guidance
promulgated thereunder, the Company may reform such provision to maintain to the
maximum extent practicable the original intent of the applicable provision
without violating the provisions of Section 409A of the Code.

 

7.                                      Nondisclosure of Confidential
Information. Executive acknowledges that during the term of his employment with
the Company, he will have access to and become acquainted with information of a
confidential, proprietary or secret nature which is or may be either applicable
to, or related in any way to, the present or future business of the Company, the
research and development or investigation of the Company, or the business of any
customer of the Company (“Confidential Information”). For example, Confidential
Information includes, but is not limited to, devices, secret inventions,
processes and compilations of information, records, specifications, designs,
plans, proposals, software, codes, marketing and sales programs, financial
projections, cost summaries, pricing formula, and all concepts or ideas,
materials or information related to the business, products or sales of the
Company and its customers and vendors. Executive shall not disclose any
Confidential Information, directly or indirectly, or use such information in any
way, either during the term of this Agreement or at any time thereafter, except
as required in the course of employment with the Company. Executive also agrees
to comply with the Company’s policies and regulations, as established from time
to time for the protection of its Confidential Information, including, for
example, executing the Company’s standard confidentiality agreements. This
section shall survive termination of this Agreement.

 

8.                                      Non-Solicitation. Executive agrees that
so long as he is employed by the Company and for a period of twenty-four (24)
months after termination of his employment for any reason, he shall not
(a) directly or indirectly solicit, induce or attempt to solicit or induce any
employee of the Company or any of its affiliated companies to discontinue his
employment with the Company; (b) usurp any opportunity of the Company or any of
its affiliated companies of which Executive

 

5

--------------------------------------------------------------------------------

 

became aware during his tenure at the Company or which is made available to him
on the basis of the belief that Executive is still employed by the Company; or
(c) directly or indirectly solicit or induce or attempt to influence any person
or business that is an account, customer or client of the Company or any of its
affiliated companies to restrict or cancel the business of any such account,
customer or client with the Company or any of its affiliated companies. This
section shall survive termination of this Agreement.

 

9.                                      Successors.

 

(a)                                  This Agreement is personal to Executive,
and without the prior written consent of the Company shall not be assignable by
Executive other than by will or the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by Executive’s legal
representatives.

 

(b)                                 The rights and obligations of the Company
under this Agreement shall inure to the benefit of and shall be binding upon the
successors and assigns of the Company.

 

10.                               Governing Law. This Agreement is made and
entered into in the State of California, and the internal laws of California
shall govern its validity and interpretation in the performance by the parties
hereto of their respective duties and obligations hereunder.

 

11.                               Modifications. This Agreement may be amended
or modified only by an instrument in writing executed by all of the parties
hereto.

 

12.                               Entire Agreement. Except as otherwise set
forth herein, this Agreement, along with the Change in Control Agreement,
supersedes any and all prior written or oral agreements between Executive and
the Company, including but not limited to any and all employment agreements and
change in control agreements. This Agreement, along with the Change in Control
Agreement, contains the entire understanding of the parties hereto with respect
to the terms and conditions of Executive’s employment with the Company;
provided, however, that this Agreement is not intended to supersede any
agreements that Executive may previously have entered into regarding the
protection of trade secrets and confidential information.

 

13.                               Dispute Resolution

 

(a)                                  Any controversy or dispute between the
parties involving the construction, interpretation, application or performance
of the terms, covenants, or conditions of this Agreement, the employment of
Executive or in any way arising under this Agreement (a “Covered Dispute”)
shall, on demand by either of the parties be referenced pursuant to the
procedures described in California Code of Civil Procedure (“CCP”) Sections 638,
et seq., as they may be amended from time to time (or such procedures as nearly
the same as may be available under the laws of California, the “Reference
Procedures”), to a retired Judge from the superior court of California for the
County of Riverside (the “Venue County”) for a decision.

 

(b)                                 The Reference Procedures shall be commenced
by a joint stipulation filed in the Venue County Court or by either party filing
in the superior court of Venue County a motion pursuant to CCP Section 638 (or
such procedures as nearly the same as may be available under the laws of
California, a “Motion”). The referee shall be a Judge from the list of retired

 

6

--------------------------------------------------------------------------------

 

superior court Judges from the Venue County who have made themselves available
for trial or settlement of civil litigation under said Reference Procedures. If
the parties hereto are unable to agree on the designation of a particular
retired superior court Judge of the Venue County, or the designated Judge is
unavailable or unable to serve in such capacity, request shall be made that the
Presiding or Assistant Presiding Judge of the superior court of the Venue County
appoint as referee a retired superior court Judge from the aforementioned list.

 

(c)                                  Except as hereafter agreed by the parties,
the referee shall apply the internal law of the State of California in deciding
the issues submitted hereunder. Each of the parties reserves its respective
rights to allege and assert in such pleadings all claims, causes of action,
contentions and defenses which it may have arising out of or relating to the
general subject matter of the Covered Dispute that is being determined pursuant
to the Reference Procedures. Reasonable notice of any motions before the referee
shall be given, and all matters shall be set at the convenience of the referee.
Discovery shall be conducted as the parties agree or as allowed by the referee.
Unless waived by each of the parties, a reporter shall be present at all
proceedings before the referee. By agreeing to this procedure, the parties
expressly waive their right to a jury trial.

 

(d)                                 It is the parties’ intention by this Section
13 that all issues of fact and law and all matters of a legal and equitable
nature related to any Covered Dispute will be submitted for determination by a
referee designated as provided herein. Accordingly, the parties hereby stipulate
that a referee designated as provided herein shall have all powers of a Judge of
the superior court including, without limitation, the power to grant equitable
and interlocutory and permanent injunctive relief.

 

(e)                                  Each of the parties specifically consents
and agrees to (i) the exercise of jurisdiction over his person by a referee
designated as provided herein with respect to any and all Covered Disputes; (ii)
the personal jurisdiction of the California courts with respect to any appeal or
review of the decision of any such referee, and (iii) venue for any dispute
subject to this Section 13 shall be in the County of Riverside.

 

(f)                                    Each of the parties acknowledges that the
decision by a referee designated as provided herein shall be a basis for a
judgment as provided in CCP Section 644 and shall be subject to exception and
review as provided in CCP Section 645, or such procedures as nearly the same as
may be available under the laws of California.

 

(g)                                 The Company shall pay all fees and costs
incurred by Executive in connection with the Reference Procedures for a Covered
Dispute other than attorneys’ fees incurred by Executive.

 

14.                               Notices. Any notice or communications required
or permitted to be given to the parties hereto shall be delivered personally or
be sent by United States registered or certified mail, postage prepaid and
return receipt requested, and addressed or delivered as follows, or at such
other addresses the party addressed may have substituted by notice pursuant to
this Section:

 

7

--------------------------------------------------------------------------------

 

To the Company:

To Executive:

 

 

Fleetwood Enterprises, Inc.

(Name)

3125 Myers Street

(Home Address)

Riverside, California 92503-5527

(City, State, Zip)

Attn: General Counsel

 

 

15.                               Captions. The captions of this Agreement are
inserted for convenience and do not constitute a part hereof.

 

16.                               Severability. In case any one or more of the
provisions contained in this Agreement shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement, but
this Agreement shall be construed as if such invalid, illegal or unenforceable
provision had never been contained herein and there shall be deemed substituted
for such invalid, illegal or unenforceable provision such other provision as
will most nearly accomplish the intent of the parties to the extent permitted by
the applicable law. In case this Agreement, or any one or more of the provisions
hereof, shall be held to be invalid, illegal or unenforceable within any
governmental jurisdiction or subdivision thereof, this Agreement or any such
provision thereof shall not as a consequence thereof be deemed to be invalid,
illegal or unenforceable in any other governmental jurisdiction or subdivision
thereof.

 

17.                               Counterparts. This Agreement may be executed
in two or more counterparts, each of which shall be deemed an original, but all
of which shall together constitute one in the same Agreement.

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered effective as of the day and year first written above.

 

 

 

 

 

(Name)

 

 

 

 

 

FLEETWOOD ENTERPRISES, INC.,

 

a Delaware corporation

 

 

 

 

 

By:

 

 

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

8

--------------------------------------------------------------------------------