**Exhibit 10.1**

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

EMPLOYMENT AGREEMENT (“Agreement”) dated as of March 12, 2004between CHAAS Holdings, LLC, a Delaware limited liability company (the“Company”) and Ronald J. Gardhouse (the “Executive”).

 

WHEREAS, the parties wish to establish the terms of Executive’s futureemployment with the Company; and

 

WHEREAS, for purposes of this Agreement, the term “Company” shallinclude direct and indirect subsidiaries of the Company and the Company maydirect that one or more of such subsidiaries fulfill the Company’s obligationsunder this Agreement, including, but not limited to, any applicable obligationsunder Section 3 or 4 hereof.

 

Accordingly, the parties agree as follows:

 

# 1.                                       Employment,Duties and Acceptance.

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## 1.1                                 Employmentby the Company.  The Company shallemploy the Executive effective as of March 15, 2004 (the “Effective Date”)to render exclusive, subject to the last sentence of this Section 1.1, andfull-time services to the Company.  TheExecutive will serve in the capacity of Executive Vice President and, effectiveas of April 1, 2004, Chief Financial Officer, and such other positions ofthe Company or its subsidiaries as designated by the Company and shall reportto the President and/or Chief Executive Officer of the Company.  The Executive will perform such lawfulduties related to the business of the Company as are imposed on the holder ofthat office by the By-laws and other constituent documents of the Company andsuch other lawful duties related to the business of the Company as arecustomarily performed by one holding such positions in the same or similarbusinesses or enterprises as those of the Company.  The Executive will perform such other lawful duties related tothe business of the Company as may be assigned to him from time to time by thePresident and/or Chief Executive Officer of the Company or the Board ofManagers of the Company, either directly or indirectly through itsChairman.  The Executive will devote allhis full working-time and attention to the performance of such duties and tothe promotion of the business and interests of the Company.  This provision, however, will not preventthe Executive from investing his funds or assets in any form or manner, or fromacting as an advisor to or a member of, the board of directors of anycompanies, businesses, or charitable organizations, so long as such actions donot violate the provisions of Section 5 of this Agreement or interferewith the Executive’s performance of his duties hereunder.

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## 1.2                                 Acceptanceof Employment by the Executive.  TheExecutive accepts such employment and shall render the services describedabove.

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# 2.                                       Durationof Employment.

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Subject to Section 4 of this Agreement, this Agreement and theemployment relationship hereunder will continue in effect for one (1) year fromthe Effective Date****(the “Initial Term”), and the terms ofthis Agreement shall continue beyond the Initial Term in the following manner:the Initial Term shall be automatically extended by one (1) day to always be

 

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not less than one (1) year (the “Extended Term”); provided, however,that this extension shall cease upon the earlier of (i) the date of terminationof employment or (ii) notice of termination of employment in the case of anytermination under Section 4 hereof. The Initial Term and the Extended Term are sometimes referred to in thisAgreement as the “Term.”  In the eventof the Executive’s termination of employment during the Term, the Company’sobligation to continue to pay all base salary, as adjusted, bonus and otherbenefits then accrued shall terminate except as may be provided for inSection 4 of this Agreement.

 

# 3.                                       Compensationby the Company.

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## 3.1                                 BaseSalary.  As compensation for allservices rendered pursuant to this Agreement, the Company will pay to theExecutive an annual base salary of Two Hundred Twenty Five Thousand Dollars($225,000), subject to an upward adjustment by the Board of Managers of theCompany, in its sole discretion, and payable in accordance with the payrollpractices of the Company (“Base Salary”).

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## 3.2                                 Bonuses.  The Executive shall be eligible to receivefrom the Company an annual cash bonus in a range of thirty percent (30%) tosixty percent (60%) of Base Salary, subject, in any event, to the achievementby the Company of performance goals established by the Board of Managers of theCompany, in its sole discretion.  For2004, this bonus shall be prorated based on the period from the Effective Dateto December 31, 2004.

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## 3.3                                 Participationin Employee Benefit Plans.  TheExecutive shall be permitted, during the Term, if and to the extent eligible,to participate in any group life, hospitalization or disability insurance plan(the “Disability Policy”), health program, pension plan or similar benefit planof the Company, which may be available to other executives of the Companygenerally, on the same terms as such other executives; provided, however, theExecutive has informed the Company that he shall not elect coverage under thehospitalization plan and health program..

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## 3.4                                 CarAllowance.  The Executive shall beentitled to a monthly car allowance equal to One Thousand Two Hundred FiftyDollars ($1,250), subject to quarterly review and reduction by the Company;provided that such reduction shall not result in an amount less than Six HundredDollars ($600).

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## 3.5                                 Vacation.  The Executive shall be entitled to twenty(20) days of vacation per year.

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## 3.6                                 ExpenseReimbursement.  During the Term, theExecutive shall be entitled to receive prompt reimbursement of all reasonable out-of-pocket expenses properly incurredby him in connection with his duties under this Agreement, including reasonableexpenses of entertainment and travel, provided that such expenses aredocumented and reported in accordance with the policies and procedures of the Companyor the Board of Managers, as applicable, at the time the expenses are incurred.

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## 3.7                                 VestingUnits.  As of the Effective Date,the Executive shall be allowed, for a period of thirty (30) days from theEffective Date, to purchase up to two hundred and forty (240) of the Company’scommon units (“Restricted Units”) at a price to be mutually

 

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agreed upon by the Company and the Executive.  Restrictions applicable to the Restricted Units shall lapse (shallvest) as follows:  Forty (40) of theRestricted Units shall vest upon each of December 31, 2004, 2005 and 2006;provided the Executive is employed with the Company on each applicable vestingdate.  Another forty (40) of theRestricted Units shall vest upon receipt of the audited financial statements ofthe Company for the years ending December 31, 2004, 2005 and 2006;provided that the applicable IRR Targets for each such year are achieved andthe Executive is employed with the Company on each applicable vestingdate.  The purchase of the RestrictedUnits shall be subject to a Vesting Unit Repurchase Agreement, the Company’sOperating Agreement and Management Subscription Agreement.  Capitalized terms not defined herein shallhave the meanings ascribed to such terms under the Vesting Unit RepurchaseAgreement.

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## 3.8                                 Purchaseof Strips.  For a period of thirty(30) days from the Effective Date, the Executive shall be provided theopportunity to purchase additional equity in the Company in an amount and a priceto be agreed upon by the Company and the Executive (“Strips”).  The Company and Executive may agree to havethe Company finance, with full recourse, up to fifty percent (50%) of thepurchase price of such Strips.  Thepurchase of the Strips shall be subject to the Management SubscriptionAgreement, Unit Repurchase Agreement and Operating Agreement.

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# 4.                                       Termination.

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## 4.1                                 TerminationUpon Death.  If the Executive diesduring the Term, the Executive’s legal representatives shall be entitled toreceive the Executive’s Base Salary and accrued bonus for the period ending onthe last day of the month in which the death of the Executive occurs.

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## 4.2                                 TerminationUpon Disability.  If during the Termthe Executive’s employment with the Company is terminated as a result of a“Disability” (as defined in the Disability Policy), the Executive (or his legalrepresentatives) shall be entitled to receive the benefits set forth inSection 3.3 hereof applicable to a Disability.

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## 4.3                                 Terminationfor Cause.  The Executive’s employmenthereunder may be terminated by the Board of Managers of the Company for “Cause”(as herein defined) at any time. “Cause” shall mean with respect to the Executive, (a) the Executive’scontinued failure to substantially perform the Executive’s duties, (b) failureto follow the lawful directions of the President and Chief Executive Officer ofthe Company or the Board of Managers of the Company, either directly orindirectly through its Chairman, (c) material, willful acts of dishonesty,theft or fraud resulting or intending to result in personal gain or enrichmentat the expense of the Company, (d) commission of a felony, (e) a violation ofany written policy of the Company including, but not limited to, the Company’semployment manuals, rules and regulations which materially and adverselyaffects the Company or could reasonably be expected to materially and adverselyaffect the Company, or (f) the Executive engaging in any act that is intended,or may reasonably be expected to materially harm the reputation, business oroperations of the Company or any member of its Board of Managers or (g) anyother material breach of this Agreement or any other agreement with the Companythat the Executive signs in his personal capacity, including, but not limited to,any non-competition and confidentiality agreement.  Prior to a termination for Cause,

 

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the Executive shall be entitled to written notice from the Company andten (10) business days to cure the deficiency leading to the Causedetermination, if such deficiency is curable. Notwithstanding the foregoing and without limiting the foregoing in anyway, for the avoidance of doubt, the Executive shall receive written notice andten (10) business days to cure a deficiency under Section 4.3(a) or (b)hereof.

##  

Upon termination for Cause hereunder, the Executive shall be entitledto receive the Executive’s Base Salary through the date of termination.

 

## 4.4                                 VoluntaryTermination without Employee Good Reason. The Executive may upon at least sixty (60) but not more than ninety (90)days prior written notice to the Company terminate employment hereunder withoutEmployee Good Reason, as defined in Section 4.6.  Upon a voluntary termination without Employee Good Reason, theExecutive shall be entitled to receive the Executive’s Base Salary through thedate of termination; provided, however, that if the Company shall waive part orall of such sixty (60) but not more than ninety (90) day notice period, theExecutive shall only receive Base Salary to the date of termination specifiedin such waiver.

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## 4.5                                 Terminationby the Company Other Than For Cause.

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### (a)                                  TheCompany may terminate the Executive’s employment at any time other than forCause.  If, prior to the expiration ofthis Agreement, the Company terminates the Executive’s employment for anyreason other than Cause, then in lieu of additional salary payments to theExecutive for periods subsequent to the date of such termination, the Companyshall pay to the Executive (i) (A) if termination occurs prior to the firstanniversary of the Effective Date, his Base Salary for 6 months aftertermination, (B) if termination occurs on or after the first anniversary butprior to the second anniversary of the Effective Date, his Base Salary for 9months after termination and (C) if termination occurs on or after the secondanniversary of the Effective Date, his Base Salary for 12 months aftertermination, plus (ii) a pro rata portion of the bonus that is determined underthe terms of Section 3.2, if any, such bonus to be determined at year end,based on the period of months from January 1 of the year of termination ofemployment to the date of termination of employment multiplied by (A) 50% iftermination occurs prior to the first anniversary of the Effective Date, (B)75% if termination occurs on or after the first anniversary but prior to thesecond anniversary of the Effective Date and (C) 100% if termination occurs onor after the second anniversary of the Effective Date and (iii) the Companyshall reimburse the Executive for the applicable premiums under COBRA toreceive insurance coverage from the Company commencing on the date oftermination through the date which is the earlier to occur of (1) expiration ofthe applicable Term and (2) the day on which the Executive shall be included inany insurance program provided by any other employer.

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### (b)                                 Nothingcontained in this Section 4.5 shall prevent the Executive from receivingany and all benefits payable under any severance benefit plan or programmaintained by the Company to which the Executive is entitled.

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## 4.6                                 VoluntaryTermination with Employee Good Reason. (a)  The Executive may upon atleast sixty (60) days prior written notice to the Company terminate employmenthereunder with Employee Good Reason (as herein defined).  Upon a termination

 

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with Employee Good Reason, in lieu of additional salary payments to theExecutive for periods subsequent to the date of such termination, the Companyshall pay to the Executive (i) his Base Salary for a period of twelve (12)months after such termination plus (ii) a pro rata portion of the bonus that isdetermined under the terms of Section 3.2, if any, such bonus to bedetermined at year end, based on the period of months from January 1 ofthe year of termination of employment to the date of termination of employmentand (iii) the Company shall reimburse the Executive for the applicable premiumsunder COBRA to receive insurance coverage from the Company commencing on thedate of termination through the date which is the earlier to occur of (1) theexpiration of twelve (12) months after termination of employment and (2) theday on which the Executive shall be included in any insurance program providedby any other employer; provided, however, that if the Company shall waive partor all of such sixty (60) day notice period, the items listed in (i), (ii) and(iii) shall run from the date of termination contained in such waiver.

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### (b)                                 Theterm “Employee Good Reason” shall mean, without the consent of the Executive(i) a reduction in Base Salary or any agreed upon benefit under this Agreement;provided that the Company may at any time or from time to time amend, modify,suspend or terminate any bonus, incentive compensation or other benefit plan orprogram (in each case, other than Base Salary) provided to the Executive forany reason and without the Executive’s consent if such modification, suspensionor termination is consistent with modifications, suspensions or terminationsfor other senior executive employees of the Company, (ii) a material reductionin the Executive’s responsibilities or duties (other than a change in thenumber or identity of persons reporting to the Executive) or the title of ExecutiveVice President and (after April 1, 2004) Chief Financial Officer or (iii)the requirement by the Board of Managers of the Company that the Executiverelocate his residence from the Detroit, Michigan area; provided, that,the Company shall have thirty (30) days after receipt of notice from theExecutive pursuant to this Section 4.6 to cure the deficiency resulting inthe termination with Employee Good Reason.

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## 4.7                                 Removalfrom any Boards and Positions.  Ifthe Executive’s employment is terminated for any reason under this Agreement,he shall be deemed to resign (i) if a member, from the Board of Managers of theCompany or board of managers or board of directors of any subsidiary of theCompany or any other board to which he has been appointed or nominated by or onbehalf of the Company and (ii) from any position with the Company or anysubsidiary of the Company, including, but not limited to, as an officer of theCompany or any of its subsidiaries.

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# 5.                                       Restrictionsand Obligations of the Executive.

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## 5.1                                 Confidentiality.  (a) During the course of the Executive’s employment by the Company, theExecutive will****have access to certain trade secrets and confidentialinformation relating to the Company which is not readily available from sourcesoutside the Company.  The confidentialand proprietary information and, in any material respect, trade secrets of theCompany are among its most valuable assets, including but not limited to, itscustomer and vendor lists, database, engineering, computer programs, frameworks,models, its marketing programs, its sales, financial, marketing, training andtechnical information, and any other information, whether communicated orally,electronically, in writing or in other tangible

 

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forms concerning how the Company creates, develops, acquires ormaintains its products and marketing plans, targets its potential customers andoperates its retail and other businesses. The Company invested, and continues to invest, considerable amounts oftime and money in its process, technology, know-how, obtaining and developingthe goodwill of its customers, its other external relationships, its datasystems and data bases, and all the information described above (hereinaftercollectively referred to as “Confidential Information”), and anymisappropriation or unauthorized disclosure of Confidential Information in anyform would irreparably harm the Company. The Executive acknowledges that such Confidential Informationconstitutes valuable, highly confidential, special and unique property of theCompany.  The Executive shall hold in afiduciary capacity for the benefit of the Company all Confidential Informationrelating to the Company and its business, which shall have been obtained by theExecutive during the Executive’s employment by the Company or predecessor ofthe Company and which shall not be or become public knowledge (other than byacts by the Executive or representatives of the Executive in violation of thisAgreement).  Except as required by lawor an order of a court or governmental agency with jurisdiction, the Executiveshall not, during the period the Executive is employed by the Company or at anytime thereafter, disclose any Confidential Information, directly or indirectly,to any person or entity for any reason or purpose whatsoever, nor shall theExecutive use it in any way, except in the course of the Executive’s employmentwith, and for the benefit of, the Company or to enforce any rights or defendany claims hereunder or under any other agreement to which the Executive is aparty, provided that such disclosure is relevant to the enforcement of suchrights or defense of such claims and is only disclosed in the formalproceedings related thereto.  TheExecutive shall take all reasonable steps to safeguard the ConfidentialInformation and to protect it against disclosure, misuse, espionage, loss andtheft.  The Executive understands andagrees that the Executive shall acquire no rights to any such ConfidentialInformation.

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### (b)                                 Allfiles, records, documents, drawings, specifications, data, computer programs,evaluation mechanisms and analytics and similar items relating thereto or tothe Business (for the purposes of this Agreement, “Business” shall be asdefined in Section 5.3 hereof), as well as all customer lists, specificcustomer information, compilations of product research and marketing techniquesof the Company, whether prepared by the Executive or otherwise coming into theExecutive’s possession, shall remain the exclusive property of the Company, andthe Executive shall not remove any such items from the premises of the Company,except in furtherance of the Executive’s duties under any employment agreement.

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### (c)                                  Itis understood that while employed by the Company the Executive will promptlydisclose to it, and assign to it the Executive’s interest in any invention,improvement or discovery made or conceived by the Executive, either alone orjointly with others, which arises out of the Executive’s employment.  At the Company’s request and expense, theExecutive will assist the Company during the period of the Executive’semployment by the Company and thereafter in connection with any controversy orlegal proceeding relating to such invention, improvement or discovery and in obtainingdomestic and foreign patent or other protection covering the same.

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### (d)                                 Asrequested by the Company and at the Company’s expense, from time to time andupon the termination of the Executive’s employment with the Company for anyreason, the Executive will promptly deliver to the Company all copies and

 

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embodiments, in whatever form, of all Confidential Information in theExecutive’s possession or within his control (including, but not limited to,memoranda, records, notes, plans, photographs, manuals, notebooks,documentation, program listings, flow charts, magnetic media, disks, diskettes,tapes and all other materials containing any Confidential Information)irrespective of the location or form of such material.  If requested by the Company, the Executivewill provide the Company with written confirmation that all such materials havebeen delivered to the Company as provided herein.

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## 5.2                                 Non-Solicitationor Hire.  During the Term and (i)for a three (3) year period following a termination of the Executive’semployment by the Company for Cause or a voluntary termination by the Executivewithout Employee Good Reason or (ii) for eighteen (18) months following thetermination of the Executive’s employment by the Executive with Employee GoodReason or by the Company without Cause, the Executive shall not, (a) solicit,directly or indirectly, any party who is a customer of the Company or itssubsidiaries, or who was a customer of the Company or its subsidiaries at anytime during the twelve (12) month period immediately prior to the relevantdate, for the purpose of marketing, selling or providing to any such party anyservices or products offered by or available from the Company or itssubsidiaries and relating to the Business (provided that if the Executiveintends to solicit any such party for any other purpose, he shall notify theCompany of such intention) or (b) employ or solicit, directly or indirectly,for employment any person who is an employee of the Company or any of itssubsidiaries at the time of termination or who was an employee of the Companyor any of its subsidiaries at any time during the six (6) month periodimmediately prior to any such solicitation or employment.

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## 5.3                                 Non-Competition.  During the Term and (i) for a three (3) yearperiod  following a termination of theExecutive’s employment by the Company for Cause or a voluntary termination bythe Executive without Employee Good Reason or (ii) for eighteen (18) monthsfollowing the termination of the Executive’s employment by the Executive withEmployee Good Reason or by the Company without Cause, the Executive shall notdirectly or indirectly, whether individually, as a director, manager, member,stockholder, partner, owner, employee, consultant or agent of any business, orin any other capacity, other than on behalf of the Company or an affiliate orsuccessor of the Company, organize, establish, own, operate, manage, control,engage in, participate in, invest in, permit his name to be used by, act as aconsultant or advisor to, render services for (alone or in association with anyperson, firm, corporation or business organization), or otherwise assist anyperson or entity that engages in or owns, invests in, operates, manages orcontrols any venture or enterprise which directly or indirectly, engages orproposes to engage in (A) designing, engineering, manufacturing, selling ordistributing (x) towing systems and roof rack systems and related accessoriesor (y) any other product which the Company designs, engineers, manufactures,sells or distributes on or prior to the termination of the Executive’semployment (the “Business”) or (B) in providing services that are similar to,may be used as substitutes for or are in competition with the Business,anywhere in the world in which the Company or any of its subsidiaries engagesor proposes to engage in such Business. Notwithstanding the foregoing, nothing in this Agreement shall preventthe Executive from owning for passive investment purposes not intended tocircumvent this Agreement, less than five percent (5%) of the publicly tradedequity securities of any competing enterprise (so long as the Executive has nopower to manage, operate, advise, consult with or control the competingenterprise and no power, alone or in conjunction with other affiliated

 

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parties, to select a director, manager, general partner, or similargoverning official of the competing enterprise other than in connection with thenormal and customary voting powers afforded the Executive in connection withany permissible equity ownership).

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## 5.4                                 Reputation.  The Executive agrees not to engage in anyact that is intended, or may reasonably be expected to materially harm thereputation, business, prospects or operations of the Company, any member of itsBoard of Managers, Castle Harlan, Inc. or Castle Harlan, Partners IV, L.P., ineither case, unless as required by law or an order of a court or governmentalagency with jurisdiction

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## 5.5                                 Property.  The Executive acknowledges that alloriginals and copies of materials, records and documents generated by him orcoming into his possession during his employment by the Company are the soleproperty of the Company (“Company Property”). During the Term, and at all times thereafter, the Executive shall notremove, or cause to be removed, from the premises of the Company, copies of anyrecord, file, memorandum, document, computer related information or equipment,or any other item relating to the business of the Company, or any affiliate,except in furtherance of his duties under the Agreement.  When the Executive terminates his employmentwith the Company, or upon request of the Company at any time, the Executiveshall promptly deliver to the Company all copies of Company Property in hispossession or control.

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## 5.6                                 WorkProduct.  The Executive agrees thatall inventions, discoveries, systems, interfaces, protocols, concepts, formats,creations, developments, designs, programs, products, processes, investmentstrategies, materials, computer programs or software, data bases, improvements,or other properties related to the business of the Company or any of itsaffiliates, conceived, made or developed during the term of his employment withthe Company, whether conceived by the Executive alone or working with others,and whether patentable or not (the “Work Product”), shall be owned by andbelong exclusively to the Company.  TheExecutive hereby assigns to the Company his entire rights to the Work Productand agrees to execute any documents and take any action reasonably requested bythe Company (at the Company’s sole cost and expense) to protect the rights ofthe Company in any Work Product.  TheExecutive acknowledges that any copyrightable subject matter created by theExecutive within the scope of his employment, whether containing or involvingConfidential Information or not, is deemed a work-made-for-hire under Chapter17 of the United States Code, entitled “Copyrights,” as amended, and the Companyshall be deemed the sole author and owner thereof for any purposeswhatsoever.  In the event of anyunauthorized publication of any Confidential Information, the Company shallautomatically own the copyright in such publication.  Further, the Company shall automatically hold all patents and/ortrademarks, if any, with respect to any Work Product.

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# 6.                                       OtherProvisions.

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## 6.1                                 Notices.  Any notice or other communication requiredor which may be given hereunder shall be in writing and shall be delivered personally,telegraphed, telexed, sent by facsimile transmission or sent by certified,registered or express mail, postage prepaid, and shall be deemed given when sodelivered personally, telegraphed, telexed, or sent by facsimile transmissionor, if mailed, four (4) days after the date of mailing, as follows:

 

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| (a)    | If the  Company, to:                                                            |
|--------|---------------------------------------------------------------------------------|
|   |                                                                            |
|   | CHAAS Holdings, LLC                                                             |
|   | 12900 Hall Road                                                                 |
|   | Suite 200                                                                       |
|   | Sterling Heights, MI  48313                                                |
|   |                                                                            |
|   | Attention:   Chief Executive Officer                                       |
|   | Telephone:   586-997-2900                                                  |
|   | Fax:   586-997-6839                                                        |
|   |                                                                            |
|   | With a copy to:                                                                 |
|   |                                                                            |
|   | Castle Harlan Partners IV, L.P.                                                 |
|   | 150 E. 58th Street                                                              |
|   | New York, NY  10155                                                        |
|   |                                                                            |
|   | Attention:                                                                      | Marcel Fournier |
|   | Telephone:                                                                      | (212) 644-8600 |
|   | Fax:                                                                            | (212) 207-8042 |
|   |                                                                            |
|   | and                                                                             |
|   |                                                                            |
|   | Attention:                                                                      | Howard Weiss |
|   | Telephone:                                                                      | (212) 644-8600 |
|   | Fax:                                                                            | (212) 759-0486 |
|   |                                                                            |
|   | And a copy to:                                                                  |
|   |                                                                            |
|   | Schulte Roth & Zabel LLP                                                    |
|   | 919 Third Avenue                                                                |
|   | New York, NY  10022                                                        |
|   |                                                                            |
|   | Attention:                                                                      | André Weiss, Esq. |
|   | Telephone:                                                                      | (212) 756-2000 |
|   | Fax:                                                                            | (212) 593-5955 |
|   |                                                                            |   |
| (b)    | If the Executive,  to his home address set forth in the records of the Company. |
|        |                                                                                 |  |  |

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## 6.2                                 EntireAgreement.  This Agreement containsthe entire agreement between the parties with respect to the subject matterhereof and supersedes all prior agreements, written or oral, with respectthereto.

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## 6.3                                 Representationsand Warranties by Executive.  TheExecutive represents and warrants that he is not a party to or subject to anyrestrictive covenants, legal restrictions or other agreements in favor of anyentity or person which would in any way

 

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preclude, inhibit, impair or limit the Executive’s ability to performhis obligations under this Agreement, including, but not limited to,non-competition agreements, non-solicitation agreements or confidentialityagreements.

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## 6.4                                 Waiverand Amendments.  This Agreement maybe amended, modified, superseded, canceled, renewed or extended, and the termsand conditions hereof may be waived, only by a written instrument signed by theparties or, in the case of a waiver, by the party waiving compliance.  No delay on the part of any party inexercising any right, power or privilege hereunder shall operate as a waiverthereof, nor shall any waiver on the part of any right, power or privilegehereunder, nor any single or partial exercise of any right, power or privilegehereunder, preclude any other or further exercise thereof or the exercise ofany other right, power or privilege hereunder.

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## 6.5                                 GoverningLaw.  This Agreement shall begoverned and construed in accordance with the laws of the State of New Yorkapplicable to agreements made and to be performed entirely within such state,without regard to conflicts of laws principles.

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## 6.6                                 Assignability.  This Agreement, and the Executive’s rightsand obligations hereunder, may not be assigned by the Executive.  The Company may assign this Agreement andits rights, together with its obligations, to any other entity which willsubstantially carry on the business of the Company.

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## 6.7                                 Counterparts.  This Agreement may be executed incounterparts, each of which shall be deemed an original but all of which shallconstitute one and the same instrument.

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## 6.8                                 Headings.  The headings in this Agreement are forconvenience of reference only and shall not limit or otherwise affect themeaning of terms contained herein.

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## 6.9                                 Remedies;Specific Performance.  The partieshereto hereby acknowledge that the provisions of Section 5 are reasonableand necessary for the protection of the Company.  In addition, the Executive further acknowledges that the Companywill be irrevocably damaged if such covenants are not specificallyenforced.  Accordingly, the Executiveagrees that, in addition to any other relief to which the Company may beentitled, the Company will be entitled to seek and obtain injunctive relief(without the requirement of any bond) from a court of competent jurisdictionfor the purposes of restraining the Executive from any actual or threatenedbreach of such covenants.  In addition,without limiting the Company’s remedies for any breach of any restriction onthe Executive set forth in Section 5, in the event of such breach, theCompany will have no obligation to pay any of the amounts that remain payableby the Company under Section 4.

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## 6.10                           Severability.  If any term, provision, covenant orrestriction of this Agreement, or any part thereof, is held by a court ofcompetent jurisdiction of any foreign, federal, state, county or localgovernment or any other governmental, regulatory or administrative agency or authorityto be invalid, void, unenforceable or against public policy for any reason, theremainder of the terms, provisions, covenants and restrictions of thisAgreement shall remain in full force and effect and shall in no way be affectedor impaired or invalidated.

 

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The Executive acknowledges that the restrictive covenants contained inSection 5 are a condition of this Agreement and are reasonable and validin geographical and temporal scope and in all other respects.

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## 6.11                           JudicialModification.  If any court orarbitrator determines that any of the covenants in Section 5, or any partof any of them, is invalid or unenforceable, the remainder of such covenantsand parts thereof shall not thereby be affected and shall be given full effect,without regard to the invalid portion. If any court or arbitrator determines that any of such covenants, or anypart thereof, is invalid or unenforceable because of the geographic or temporalscope of such provision, such court or arbitrator shall reduce such scope tothe minimum extent necessary to make such covenants valid and enforceable.

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## 6.12                           TaxWithholding.  The Company or otherpayor is authorized to withhold, from any benefit provided or payment duehereunder, the amount of withholding taxes due any federal, state or localauthority in respect of such benefit or payment and to take such other actionas may be necessary in the opinion of the Board of Managers of the Company tosatisfy all obligations for the payment of such withholding taxes.

 

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IN WITNESS WHEREOF, the parties hereto, intending to be legally boundhereby, have executed this Agreement as of the day and year first abovementioned.

 
|   | EXECUTIVE                                                  |
|--------|------------------------------------------------------------|
|   |                                                       |
|   |                                                       |
|   |       /s/ Ronald J Gardhouse |
|   | Ronald J. Gardhouse                                        |
|   |                                                       |
|   |                                                       |
|   | CHAAS HOLDINGS, LLC                                        |
|   |                                                       |
|   |                                                       |
|   | By:                                                        | /s/ Terence C. Seikel |   |
|   |                                                       | Name:     Terence C. Seikel |
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