Exhibit 10.20 to RC2 2005 Form 10-K


    Exhibit
      10.20

     

    EMPLOYMENT
      AGREEMENT

    


    


    THIS
      EMPLOYMENT AGREEMENT (this "Agreement") is made as of April 26, 2004, by and
      between RC2 Brands, Inc., a Delaware corporation (the "Company"), and Gregory
      J.
      Kilrea (the "Employee"). RC2 Brands, Inc. is a wholly owned subsidiary of RC2
      Corporation, a Delaware corporation (the "Parent Company").

    


    RECITAL

    


    The
      Company desires to employ the Employee and the Employee is willing to make
      his/her services available to the Company on the terms and conditions set forth
      below. Certain capitalized terms used herein are defined in Section 10
      below.

    


    AGREEMENTS

     

    In
      consideration of the promises and the mutual agreements which follow, the
      parties agree as follows:

    


    1.    Employment.
      The
      Company hereby employs the Employee and the Employee hereby accepts employment
      with the Company on the terms and subject to the conditions set forth in this
      Agreement.

    


    2.    Term.
      This
      Agreement is effective as of the date referred to above. The Agreement is not
      intended to create a promise or contract of employment for a specific term.
      Employee's employment shall be at will, and it expressly understood that either
      the Company or Employee may terminate the employment relationship at any time
      for any reason. It is also expressly understood that during the course of
      Employee's employment, the job title, duties, responsibilities and all other
      terms and conditions of his/her employment may be modified at any time for
      any
      reason and that such modification shall not alter his/her obligations under
      this
      Agreement.

    


    3.    Duties.
      The
      Employee shall serve as the Senior Vice President of Planning and Corporate
      Development of the Company and will, under the direction of the Parent Company's
      Chief Executive Officer and President ("Top Management"), faithfully and to
      the
      best of his/her ability, perform the duties of such position. The Employee
      shall
      also perform such additional duties and responsibilities which may from time
      to
      time be reasonably assigned or delegated by Top Management. The Employee agrees
      to devote his/her entire business time, effort skill and attention to the proper
      discharge of such duties while employed by the Company.

    


    4.    Compensation.
      The
      Employee shall receive a base salary of $160,000 per year, payable in regular
      and equal monthly installments (the "Base
      Salary").
      The
      Employee's Base Salary shall be reviewed annually by Top Management of the
      Company to determine appropriate increases, if any, in such Base
      Salary.

    


    5.    Fringe
      Benefits.

    


    (a)     Vacation.
      The
      Employee shall be entitled to four weeks of paid vacation annually, under the
      terms of the Company's stated vacation policy. The Employee and the Company
      shall mutually determine the time and intervals of such
      vacation.


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    (b)    Medical,
      Health, Dental, Disability and Life Coverage.
      The
      Employee shall be eligible to participate in any medical, health, dental,
      disability and life insurance policy in effect for management of the Company
      on
      a basis consistent with his/her position and level of compensation and
      contribution within the Company as determined solely by Top Management, as
      long
      as such coverages can be obtained by the Company at a cost that is consistent
      with rest of the management group.

    


    (c)    Incentive
      Bonus and Stock Ownership Plans.
      The
      Employee shall be entitled to participate in any incentive bonus or other
      incentive compensation plan developed generally for the management of the
      Company on a basis consistent with his/her position and level of compensation
      and contribution within the Company, as determined solely by Top Management.
      The
      Employee shall also be entitled to participate in any incentive stock option
      plan or other stock ownership plan developed generally for the management of
      the
      Company on a basis consistent with his/her position and level of compensation
      and contribution within the Company, as determined solely by Top
      Management.

    


    (d)    Automobile.
      The
      Company agrees to reimburse the Employee up to $600 per month, as such amount
      may be increased from time to time consistent with the Company's reimbursement
      policy for management of the Company to cover Employee's expenses in connection
      with his/her leasing or owning an automobile. Additionally, the Company will
      pay
      for the gas used for business purposes. All maintenance and insurance expense
      for the automobile is the responsibility of the Employee.

    


    (e)    Reimbursement
      for Reasonable Business Expenses.
      The
      Company shall pay or reimburse the Employee for reasonable expenses incurred
      by
      him/her in connection with the performance of his/her duties pursuant to this
      Agreement including, but not limited to, travel expenses, expenses in connection
      with seminars, professional conventions or similar professional functions and
      other reasonable business expenses.

    


    (f)    Key
      Man Insurance.
      The
      parties agree that the Company has the option to purchase one or more key man
      life insurance policies upon the life of the Employee. The Company shall own
      and
      shall have the absolute right to name the beneficiary or beneficiaries of said
      policy. The Employee agrees to cooperate fully with the Company in securing
      said
      policy, including, but not limited to, submitting himself to any physical
      examination which may be required at such reasonable times and places as Company
      shall specify.

    


    6.    Termination.

    


    (a)    Termination
      of the Employment Period.
      The
      employment period (the "Employment Period") shall continue until the earliest
      of
      (i) the Employee's death or Disability,
      (ii) the Employee resigns or (iii) the Top Management determines that
      termination of Employee's employment is in the best interests of the Company
      (the date of the earliest of these events shall be referred to herein as the
      "Termination Date").

    


    (b)     Definitions.

    


    (i)    For
      purposes of this Agreement, "Disability" shall mean a physical or mental
      sickness or any injury which renders the Employee incapable of performing the
      services required of him/her as an employee of the Company and which does or
      may
      be expected to continue for more than six (6) months during any 12-month period.
      In the event Employee shall be able to perform his/her usual and customary
      duties on behalf of the Company following a period of disability, and does
      so
      perform such duties, or such other duties as are prescribed by the Board of
      Directors or the President of the Company, for a period of three continuous
      months, any subsequent period of disability shall be


    
      
        
        

      

      
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    regarded
      as a new period of disability for purposes of this Agreement. The Company and
      the Employee shall determine the existence of a Disability and the date upon
      which it occurred. In the event of a dispute regarding whether or when a
      Disability occurred, the matter shall be referred to a medical doctor selected
      by the Company and the Employee. In the event of their failure to agree upon
      such a medical doctor, the Company and the Employee shall each select a medical
      doctor who together shall select a third medical doctor who shall make the
      determination. Such determination shall be conclusive and binding upon the
      parties hereto.

    


    (ii)    For
      purposes of this Agreement, "Cause" shall be deemed to exist if the Employee
      shall have (1) violated the terms of sections 7 or 8 of this Agreement; (2)
      failed to substantially perform his/her duties to the reasonable satisfaction
      of
      Top Management; (3) committed a felony or a crime involving moral turpitude;
      (4)
      engaged in serious misconduct which is demonstrably injurious to the Company,
      or
      the Parent Company or any of its Subsidiaries; (5) engaged in fraud or
      dishonesty with respect to the Company, or the Parent Company or any of its
      Subsidiaries or made a material misrepresentation to the stockholders or
      directors of the Company or the Parent Company; or (6) committed acts of
      negligence in the performance of his/her duties which are substantially
      injurious to the Company, or the Parent Company or any of its
      subsidiaries.

    


    (c)    Termination
      for Disability or Death.
      In the
      event of termination for Disability or death, payments of the Employee's Base
      Salary shall be made to the Employee, for a period of three (3) months after
      the
      Termination Date in accordance with the normal payroll practices of the Company.
      During this period, the Company shall also reimburse the Employee or Employee's
      estate for amounts paid, if any, to continue medical, dental and health coverage
      pursuant to the provisions of the Consolidated Omnibus Budget Reconciliation
      Act
      and will pay to the Employee or Employee's estate the fringe benefits pursuant
      to section 5 which have accrued prior to the Termination Date. Incentive bonus,
      in any, for the year of termination will be prorated based on the Termination
      Date and paid in accordance with the annual bonus payment schedule.

    


    (d)    Termination
      by the Company without Cause.
      If (i)
      the Employee is terminated by the Company for any reason other than for Cause,
      Disability or death, (ii) if the Employee is terminated by the Company for
      what
      the Company believes is Cause or Disability, and it is ultimately determined
      that the Employee was terminated without Cause or Disability, the Employee
      shall
      be entitled to receive, as severance, his/her Base Salary for a period of three
      (3) months following the Termination Date; provided, however, that if such
      termination occurs at any time within one year after the occurrence of, or
      in
      contemplation of, a Change of Control then Employee shall be entitled to receive
      his/her Base Salary for a period of one year following the Termination Date.
      Such payment of Base Salary shall be made in accordance with the normal payroll
      practices of the Company, net of applicable taxes, tax withholdings and employee
      portions of medical and dental insurance premiums, if any. During this period,
      the Company shall also continue to pay the Company portion of premiums, if
      any,
      to continue medical and dental coverage pursuant to the provisions of the
      existing plan or of the Consolidated Omnibus Budget Reconciliation Act. During
      this period, the Company will also continue Employee's life insurance and
      disability coverage, to the extent permitted under applicable policies, and
      will
      pay to the Employee the fringe benefits pursuant to section 5 which have accrued
      prior to the Termination Date. Incentive bonus, in any, for the year of
      termination will be prorated based on the Termination Date and paid in
      accordance with the annual bonus payment schedule. Notwithstanding the forgoing,
      the Company shall not be obligated to make any of the payments or provide the
      other benefits called for by this section 6(d) unless (i) Employee signs a
      waiver and release of all claims against the Company, the Parent Company and
      its
      subsidiaries in a form acceptable to the Company, and (ii) Employee is not
      in
      breach of this Agreement, including sections 7 and 8.

    



    
      
        
        

      

      
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    (e)    Termination
      by the Company for Cause or by Resignation by the Employee.
      If the
      Employee's employment is terminated by the Company with Cause or as a result
      of
      the Employee's resignation, the Employee shall not be entitled to receive any
      future Base Salary, fringe benefits or incentive bonus payments or any other
      payments or benefits for periods after the Termination Date. Bonuses will not
      be
      prorated based on the Termination Date; Bonuses will be paid only if the
      employee is employed at the time of the annual bonus payments.

    


    (f)    Effect
      of Termination.
      The
      termination of the Employment Period pursuant to section 6 shall not affect
      the
      Employee's obligations as described in sections 7 and 8.

    


    7.    Noncompetition
      and Nonsolicitation.
      The
      Employee acknowledges and agrees that the contacts and relationships of the
      Company and its Subsidiaries with its customers, suppliers, licensors and other
      business relations are, and have been, established and maintained at great
      expense and provide the Company and its Subsidiaries with a substantial
      competitive advantage in conducting their business. The Employee acknowledges
      and agrees that by virtue of the Employee's employment with the Company, the
      Employee will have unique and extensive exposure to and personal contact with
      the Company's customers and licensors, and that he will be able to establish
      a
      unique relationship with those Persons that will enable him/her, both during
      and
      after employment, to unfairly compete with the Company and its Subsidiaries.
      Furthermore, the parties agree that the terms and conditions of the following
      restrictive covenants are reasonable and necessary for the protection of the
      business, trade secrets and Confidential Information (as defined in section
      8
      below) of the Company and its Subsidiaries and to prevent great damage or loss
      to the Company and its Subsidiaries as a result of action taken by the Employee.
      The Employee acknowledges and agrees that the noncompete restrictions and
      nondisclosure of Confidential Information restrictions contained in this
      Agreement are reasonable and the consideration provided for herein is sufficient
      to fully and adequately compensate the Employee for agreeing to such
      restrictions. The Employee acknowledges that he could continue to actively
      pursue his/her career and earn sufficient compensation in the same or similar
      business without breaching any of the restrictions contained in this Agreement.
      The Employee acknowledges that one business of the Company and its Subsidiaries
      is the design, production (including, without limitation, the obtaining of
      the
      licenses necessary therefor), marketing and sale of collectibles, toys, apparel,
      souvenirs and trading cards.

    


    (a)    Noncompetition.
      The
      Employee hereby covenants and agrees that during the Employment Period he/she
      shall not, directly or indirectly, either individually or as an employee,
      principal, agent, partner, shareholder, owner, trustee, beneficiary,
      co-venturer,
      distributor, consultant, representative or in any other capacity, participate
      in, become associated with, provide assistance to, engage in or have a financial
      or other interest in any business, activity or enterprise which is competitive
      with the Company or any of its Subsidiaries or any successor or assign of the
      Company or any of its Subsidiaries. The ownership of less than a one percent
      interest in a corporation whose shares are traded in a recognized stock exchange
      or traded in the over-the-counter market, even though that corporation may
      be a
      competitor of the Company, shall not be deemed financial participation in a
      competitor. The term "indirectly" as used in this section and section 8 below
      is
      intended to include any acts authorized or directed by or on behalf of the
      Employee or any Affiliate of the Employee.

    


    (b)    Nonsolicitation.
      The
      Employee hereby covenants and agrees that during the Employment Period and
      for a
      period of 18 months thereafter (the "Noncompete Period"), he/she shall not,
      directly or indirectly, either individually or as an employee, agent, partner,
      shareholder, owner, trustee, beneficiary, co-venturer, distributor, consultant
      or in any other capacity;

    



    
      
        
        

      

      
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    (i)    canvass,
      solicit or accept from any Person who is a customer or licensor of the Company
      or any of its Subsidiaries (any such Person is hereinafter referred to
      individually as a "Customer," and collectively as the "Customers") any business
      which in competition with the business of the Company or any of its Subsidiaries
      or the successors or assigns of the Company or any of its Subsidiaries,
      including, without limitation, the canvassing, soliciting or accepting of
      business from any Person which is or was a Customer of the Company within two
      years preceding the date hereof or with the Company or any of its Subsidiaries
      during the Noncompete Period;

    


    (ii)    advise,
      request, induce or attempt to induce any of the Customers, suppliers, or other
      business contacts of the Company or any of its Subsidiaries who currently have
      or have had business relationships with the Company within two years preceding
      the date hereof or with the Company or any of its Subsidiaries during the
      Noncompete Period, to withdraw, curtail or cancel any of its business or
      relations with the Company or any of its Subsidiaries;

    


    (iii)    induce
      or
      attempt to induce any employee, sales representative, consultant or other agent
      of the Company or any of its Subsidiaries to terminate her relationship or
      breach any agreement with the Company or any of its Subsidiaries;
      or

    


    (iv)    hire
      any
      person who was an employee, sales representative, consultant or other agent
      of
      the Company or any of its Subsidiaries at any time during the Noncompete
      Period.

    


    If
      the
      final judgment of a court of competent jurisdiction declares that any term
      or
      provision of this section is invalid or unenforceable, the parties agree that
      the court making the determination of invalidity or unenforceability shall
      have
      the power to reduce the scope, duration, or area of the term or provision,
      to
      delete specific words or phrases, or to replace any invalid or unenforceable
      term or provision with a term or provision that is valid and enforceable and
      that comes closest to expressing the intention of the invalid or unenforceable
      term or provision, and this Agreement shall be enforceable as so
      modified.

    


    8.    Confidential
      Information.
      The
      Employee acknowledges and agrees that the customers, business connections,
      customer lists, procedures, operations, techniques, and other aspects of and
      information about the business of the Company and its Subsidiaries (the
      "Confidential Information") are established at great expense and protected
      as
      confidential information and provide the Company and its Subsidiaries with
      a
      substantial competitive advantage in conducting their business. The Employee
      further acknowledges and agrees that by virtue of her past employment with
      the
      Company, and by virtue of her employment with the Company, she has had access
      to
      and will have access to, and has been entrusted with and will be entrusted
      with,
      Confidential Information, and that the Company would suffer great loss and
      injury if the Employee would disclose this information or use in a manner not
      specifically authorized by the Company. Therefore, the Employee agrees that
      during the Employment Period and for five (5) years thereafter, she will not,
      directly or indirectly, either individually or as an employee, agent, partner,
      shareholder, owner, trustee, beneficiary, co-venturer, distributor, consultant
      or in any other capacity, use or disclose, or cause to be used or disclosed,
      any
      Confidential Information, unless and to the extent that any such information
      become generally known to and available for use by the public other than as
      a
      result of the Employee's acts or omissions. The Employee shall deliver to the
      Company at the termination of the Employment Period, or at any other time the
      


    
      
        
        

      

      
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    Company
      may request, all memoranda, notes, plans, records, reports, computer tapes,
      printouts and software and other documents and data (and copies thereof relating
      to the Confidential Information, Work Product (as defined below) or the business
      of the Company or any Subsidiary which he may then possess or have under her
      control. The Employee acknowledges and agrees that all inventions, innovations,
      improvements, developments, methods, designs, analyses, drawings, reports and
      all similar or related information (whether or not patentable) which relate
      to
      the Company's or any of its Subsidiaries' actual or anticipated business,
      research and development or existing or future products or services and which
      are conceived, developed or made by the Employee while employed by the Company
      and its Subsidiaries ("Work Product") belong to the Company or such Subsidiary,
      as the case may be.

    


    9.    Common
      Law of Torts and Trade Secrets.
      The
      parties agree that nothing in this Agreement shall be construed to limit or
      negate the common law of torts or trade secrets where it provides the Company
      and its Subsidiaries with broader protection than that provided
      herein.

    


    10.    Definitions.

    


    "Affiliate"
      means
      with respect to any Person, any other Person controlling, controlled by or
      under
      common control with such Person and any partner of a Person which is a
      partnership.

    


    "Change
      of Control"
      means:

    


    (a)    The
      acquisition by any individual, entity or group (within the meaning of Section
      13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the
      "Exchange Act")) (a "Person") of beneficial ownership (within the meaning of
      Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (i)
      the
      then outstanding shares of common stock of Parent Company (the "Outstanding
      Common Stock") or (ii) the combined voting power of the then outstanding voting
      securities of Parent Company entitled to vote generally in the election of
      directors (the "Outstanding Voting Securities"); provided, however, that the
      following acquisitions shall not constitute a Change of Control: (i) any
      acquisition directly from Parent Company, (ii) any acquisition by Parent
      Company, (iii) any acquisition by any employee benefit plan (or related trust)
      sponsored or maintained by Parent Company or any corporation controlled by
      Parent Company or (iv) any acquisition by any corporation pursuant to a
      transaction which complies with clauses (i), (ii) and (iii) of subsection (c)
      of
      this definition; or

    


    (b)    Individuals
      who, as of the date hereof, constitute the Board of Directors of Parent Company
      (the "Incumbent Board") cease for any reason to constitute at least a majority
      of the Board of Directors of Parent Company; provided, however, that any
      individual becoming a director subsequent to the date hereof whose election,
      or
      nomination for election by Parent Company's stockholders, was approved by a
      vote
      of at least a majority of the directors then comprising the Incumbent Board
      shall. be considered as though such individual were a member of the Incumbent
      Board, but excluding, for this purpose, any such individual whose initial
      assumption of office occurs as a result of an actual or threatened election
      contest with respect to the election or removal of directors or other actual
      or
      threatened solicitation of proxies or consents by or on behalf of a Person
      other
      than the Board of Directors of Parent Company; or

    



    
      
        
        

      

      
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    (c)    Approval
      by the stockholders of Parent Company of a reorganization, merger or
      consolidation (a "Business Combination"), in each case, unless, following such
      Business Combination, (i) all or substantially all of the individuals and
      entities who were the beneficial owners, respectively, of the Outstanding Common
      Stock and Outstanding Voting Securities immediately prior to such Business
      Combination beneficially own, directly or indirectly, more than 60% of,
      respectively, the then outstanding shares of common stock and the combined
      voting power of the then outstanding voting securities entitled to vote
      generally in the election of directors, as the case may be, of the corporation
      resulting from such Business Combination (including, without limitation, a
      corporation which as a result of such transaction owns Parent through one or
      more subsidiaries) in substantially the same proportions as their ownership,
      immediately prior to such Business Combination of the Outstanding Common Stock
      and Outstanding Voting Securities, as the case may be, (ii) no Person (excluding
      any employee benefit plan (or related trust) of Parent or such corporation
      resulting from such Business Combination) beneficially owns, directly or
      indirectly, 20% or more of, respectively, the then outstanding shares of common
      stock of the corporation resulting from such Business Combination or the
      combined voting power of the then outstanding voting securities of such
      corporation except to the extent that such ownership existed prior to the
      Business Combination and (iii) at least a majority of the members of the board
      of directors of the corporation resulting from such Business Combination were
      members of the Incumbent Board at the time of the execution of the initial
      agreement, or of the action of the Board of Directors of Parent Company,
      providing for such Business Combination; or

    


    (d)    Approval
      by the stockholders of Parent Company of (i) a complete liquidation or
      dissolution of Parent Company or (ii) the sale or other disposition of all
      or
      substantially all of the assets of Parent Company, other than to a corporation,
      with respect to which following such sale or other disposition, [a] more than
      60% of, respectively, the then outstanding shares of common stock of such
      corporation and the combined voting power of the then outstanding voting
      securities of such corporation entitled to vote generally in the election of
      directors is then beneficially owned, directly or indirectly, by all or
      substantially all of the individuals and entities who were the beneficial
      owners, respectively, of the Outstanding Common Stock and Outstanding Voting
      Securities immediately prior to such sale or other disposition in substantially
      the same proportion as their ownership, immediately prior to such sale or other
      disposition, of the Outstanding Common Stock and Outstanding Voting Securities,
      as the case may be, [b] less than 20% of, respectively, the then outstanding
      shares of common stock of such corporation and the combined voting power of
      the
      then outstanding voting securities of such corporation entitled to vote
      generally in the election of directors is then beneficially owned, directly
      or
      indirectly, by any Person (excluding any employee benefit plan (or related
      trust) of Parent Company or such corporation), except to the extent that such
      Person owned 20% or more of the Outstanding Common Stock or Outstanding Voting
      Securities prior to the sale or disposition, and [c] at least a majority of
      the
      members of the board of directors of such corporation were members of the
      Incumbent Board at the time of the execution of the initial agreement, or of
      the
      action of the Board of Directors of Parent Company, providing for such sale
      or
      other disposition of assets of Parent Company or were elected, appointed or
      nominated by the Board of Directors of Parent Company.

    


    "Person"
      means
      any individual, partnership, corporation, limited liability company,
      association, joint stock company, trust, joint venture, unincorporated
      organization and any governmental entity or any department, agency or political
      subdivision thereof.

    



    
      
        
        

      

      
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    "Subsidiary
      " means,
      with respect to any Person, any corporation, partnership, association or other
      business entity of which (i) if a corporation, a majority of the total voting
      power of shares of stock entitled (without regard to the occurrence of any
      contingency) to vote in the election of directors, managers or trustees thereof
      is at the time owned or controlled, directly or indirectly, by that Person
      or
      one or more of the other Subsidiaries of that Person or a combination thereof,
      or (ii) if a partnership, association or other business entity, a majority
      of
      the partnership or other similar ownership interest thereof is at the time
      owned
      or controlled, directly or indirectly, by any Person or one or more Subsidiaries
      of that Person or a combination thereof. For purposes hereof, a Person or
      Persons shall be deemed to have a majority ownership interest in a partnership,
      association or other business entity if such Person or Persons shall be
      allocated a majority of partnership, association or other business entity gains
      or losses or shall be or control any managing director or general partner of
      such partnership, association or other business entity.

    


    11.    Specific
      Performance.
      The
      Employee acknowledges and agrees that irreparable injury to the Company may
      result in the event the Employee breaches any covenant or agreement contained
      in
      sections 7 and 8 and that the remedy at law for the breach of any such covenant
      will be inadequate. Therefore, if the Employee engages in any act in violation
      of the provisions of sections 7 and 8, the Employee agrees that the Company
      shall be entitled, in addition to such other remedies and damages as may be
      available to it by law or under this Agreement, to injunctive relief to enforce
      the provisions of sections 7 and 8.

    


    12.    Waiver.
      The
      failure of either party to insist in any one or more instances, upon performance
      of the terms or conditions of this Agreement shall not be construed as a waiver
      or a relinquishment of any right granted hereunder or of the future performance
      of any such term, covenant or condition.

    


    13.    Notices.
      Any
      notice to be given hereunder shall be deemed sufficient if addressed in writing,
      and delivered by registered or certified mail or delivered personally, in the
      case of the Company, to its principal business office, and in the case of the
      Employee, to her address appearing on the records of the Company, or to such
      other address as she may designate in writing to the Company.

    


    14.    Severability.
      In the
      event that any provision shall be held to be invalid or unenforceable for any
      reason whatsoever, it is agreed such invalidity or unenforceability shall not
      affect any other provision of this Agreement and the remaining covenants,
      restrictions and provisions hereof shall remain in full force and effect and
      any
      court of competent jurisdiction may so modify the objectionable provision as
      to
      make it valid, reasonable and enforceable. Furthermore, the parties specifically
      acknowledge the above covenant not to compete and covenant not to disclose
      confidential information are separate and independent agreements.

    


    15.    Complete
      Agreement.
      Except
      as other-wise expressly set forth herein, this document embodies the complete
      agreement and understanding among the parties hereto with respect to the subject
      matter hereof and supersedes and preempts any prior understandings, agreements
      or representations by or among the parties, written or oral, which may have
      related to the subject matter hereof in any way.

    


    16.    Amendment.
      This
      Agreement may only be amended by an agreement in writing signed by each of
      the
      parties hereto.

    



    
      
        
        

      

      
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    17.    Governing
      Law; Arbitration.
      This
      Agreement shall be governed by and construed exclusively in accordance with
      the
      laws of the State of Illinois, regardless of choice of law requirements. The
      parties hereby consent to the jurisdiction of the state courts located in DuPage
      County of the State of Illinois and of any federal court in the venue of the
      Northern District of Illinois for the purpose of any suit, action or proceeding
      arising out of or related to this Agreement, and expressly waive any and all
      objections they may have as to venue in any of such courts. Any controversy
      or
      claim arising out of or relating to this Agreement, other than a claim that
      would entitle the Employee or the Company to injunctive relief, shall be settled
      by expedited arbitration (i.e., 15 day presentation of evidence; 15 day decision
      by arbitrator) in accordance with the rules of the American Arbitration
      Association in such place as the Company's headquarters are then
      located.

    


    18.    Benefit.
      This
      Agreement shall be binding upon and inure to the benefit of and shall be
      enforceable by and against the Company, its successors and assigns and the
      Employee, her heirs, beneficiaries and legal representatives. It is agreed
      that
      the rights and obligations of the Employee may not be delegated or
      assigned.

    


    IN
      WITNESS HEREOF, the parties hereto have executed this Employment Agreement
      on
      the day and year first above written.

    


    


    RC2
      BRANDS, INC.

    


    


    By: 
      /s/ Curtis
      W.
      Stoelting                       
 

    Its:
       Chief Executive Officer

    


    


    /s/
      Gregory J.
      Kilrea                                       

    Gregory
      J. Kilrea

     

     

     

    
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