EXHIBIT 10.27


 


INTERLINE BRANDS, INC.


EMPLOYMENT AGREEMENT


 


AGREEMENT entered into as of the 30th day of April,
2007 (the “Effective Date”) by and between INTERLINE BRANDS, INC., a New
Jersey corporation (the “Company”), and Ken Sweder (“Executive”).


 


WHEREAS the Company desires
to employ Executive as Chief Merchandising Officer and Executive is willing to
serve the Company in such capacity for the period and upon such other terms and
conditions of this Agreement.


 


NOW, THEREFORE, in consideration of the premises and
mutual covenants herein and for other good and valuable consideration and
intending to be legally bound hereby, the parties agree as follows:


 


1.                                     Term
of Employment.  Executive’s term of
employment with the Company under this Agreement shall begin on April 30,
2007, and unless sooner terminated as hereafter provided, shall continue for
one (1) year (the “Employment Term”); provided that the Employment
Term shall automatically be extended for successive one-year periods; provided
further that the Agreement may be terminable by either party upon sixty (60)
days written notice of such party’s intention to terminate.


 


2.                                     Position.


 


(a)           Executive
shall serve as Chief Merchandising Officer of the Company.  In such position, Executive shall have such
duties and authority as are customarily associated with such position and
agrees to perform such duties and functions as shall from time to time be
assigned or delegated to Executive by the President of the Company or his
designee.


 


(b)           During
the Employment Term, Executive will devote substantially all of Executive’s
business time and best efforts to the performance of Executive’s duties
hereunder and will not engage in any other business, profession or occupation
for compensation or otherwise which would conflict with the rendition of such
services, either directly or indirectly, without the prior written consent of
the President of the Company.


 


3.                                     Base
Salary.  During the Employment Term,
the Company shall pay Executive an annual base salary (the “Base Salary”)
at the annual rate of $260,000, payable in regular installments in accordance
with the Company’s usual payroll practices. 
Such base salary may, at the sole discretion of the President of the
Company, be upwardly adjusted.


 


4.                                     Bonus.  With respect to each calendar year during the
Employment Term, Executive shall be eligible to earn an annual bonus award with
a target of 50% percent of the Base Salary (the “Target Bonus”), based
upon bonus plans to be 


 


i

















 


established and determined
by the Board of Directors of the Company (the “Board”) from time to time.
The actual amount of the annual bonus award may be more or less than the Target
Bonus and will determined on the same basis as bonus payments made to other
executives of the Company. For 2007, Executive’s annual bonus award will be
prorated to reflect the portion of the calendar year for which Executive was
employed by the Company.


 


5.                                     Employee
Benefits And Perquisites.


 


(a)           Benefits.  During the Employment Term, Executive shall
be eligible to participate in the Company’s employee benefit plans (including,
without limitation, its health insurance and short term and long term
disability insurance plans) on the same basis as those benefits are generally
made available to other executives of the Company.  All of the benefits and perquisites described
in this Section 5(a) shall hereafter be referred to collectively as
the “Benefits.”


 


(b)           Car
Allowance.  During the Employment Term,
the Company shall pay Executive an amount of $1,000 per month as an automobile
allowance.


 


6.                                     Relocation.


 


(a)           Relocation
Expenses.  Executive shall be
reimbursed for reasonable relocation expenses (the “Relocation Expenses”)
incurred by Executive in connection with Executive’s relocation to
Jacksonville, Florida, subject to such substantiation and documentation as the
Company may reasonably require; provided  however, that the
Relocation Expenses shall not exceed a maximum amount of $110,000.


 


(b)           Relocation
Payment.  Executive shall be entitled
to receive a one-time relocation payment in an amount of $25,000 on the date
that is the later of (i) thirty (30) days following Executive’s relocation
to Jacksonville, Florida, or (ii) 120 days after the first day of the
Employment Term.


 


7.                                     Business
Expenses.  During the Employment
Term, reasonable business expenses incurred by Executive in the performance of
Executive’s duties hereunder shall be reimbursed by the Company in accordance
with the Company’s policies on expense reimbursement, in effect from time to
time.


 


8.                                     Performance-Based
Restricted Share Units.  Executive
shall receive on the first day of the Employment Term 8,577 Restricted Share Units
(the “Award”), with a target awards equal to two-thirds of the Award, or
5,718 Restricted Share Units (the”Target Award”)


 


with respect to the Company’s Common Stock that will
be subject to forfeiture provisions and such other terms and conditions as are
set forth in the restricted share unit agreement (the “Performance Based Restricted
Share Unit Agreement”) being 


 

















 


entered into concurrently herewith by the Company and
Executive, which agreement is attached hereto as Exhibit A.


 


9.                                     Time-Based
Restricted Share Units.  Executive
shall receive on the first day of the Employment Term 18,298 restricted share
units with respect to the Company’s Common Stock that will be subject to
forfeiture provisions and such other terms and conditions as are set forth in
the restricted share unit agreement (the “Time-Based Restricted Share Unit
Agreement”) being entered into concurrently herewith by the Company and
Executive, which agreement is attached hereto as Exhibit B.


 


11.                               Stock
Options  Executive shall receive on
the first day of the Employment Term non-qualified stock options to purchase 30,000
shares of the Company’s Common Stock that will be subject to the terms and
conditions as are set forth in the non-qualified stock option agreement (the “Stock
Option Agreement”) being entered into concurrently herewith by the Company
and Executive, which agreement is attached hereto as Exhibit C.


 


12.                               Termination.  Notwithstanding any other provision of this Agreement:


 


(a)           For Cause By the Company.  The Employment Term and Executive’s
employment hereunder may be terminated by the Company for “Cause.”  For purposes of this Agreement, “Cause” shall
mean (i) Executive’s gross neglect of, or willful and continued failure to
substantially perform, Executive’s duties hereunder (other than as a result of
total or partial incapacity due to physical or mental illness); (ii) a willful
act by Executive against the interests of the Company or which causes or is
intended to cause harm to the Company or its stockholders; (iii) Executive’s
conviction, or plea of no contest or guilty, to a felony under the laws of the
United States or any state thereof or of a lesser offense involving dishonesty,
the theft of Company property or moral turpitude; or (iv) a material
breach of the Agreement by Executive which is not cured by Executive within
twenty (20) days (where the breach is curable) following written notice to Executive
by the Company of the nature of the breach. 
Upon termination of Executive’s employment for Cause pursuant to this Section 12(a),
Executive shall be paid any accrued and unpaid Base Salary and Benefits through
the date of termination and shall have no additional rights to any compensation
or any other benefits under the Agreement or otherwise.


 


(b)           Disability or Death.  The Employment Term and Executive’s
employment hereunder shall terminate upon Executive’s death or if Executive is
unable for an aggregate of six (6) months in any twelve (12) consecutive
month period to perform Executive’s duties due to Executive’s physical or
mental incapacity, as reasonably determined by the Board (such incapacity is hereinafter
referred to as “Disability”).  Upon
termination of Executive’s employment hereunder for either Disability or death,
Executive or Executive’s estate (as the case may be) shall be entitled to
receive (i) any accrued and unpaid Base Salary and Benefits and (ii) a
bonus for the calendar year in which termination occurs, equal to the bonus
which Executive would have been entitled to if he had remained employed by the
Company at the end of such 


 

















 


calendar year, multiplied
by a fraction, the numerator of which is the number of days in such calendar
year preceding the date of death or termination of employment and the
denominator of which is 365 (a “Pro Rata Bonus”).  Upon termination of Executive’s employment
due to Disability or death pursuant to this Section 12(b), Executive shall
have no additional rights to any compensation or any other benefits under this
Agreement.  All other benefits, if any,
due Executive following Executive’s termination for Disability or death shall
be determined in accordance with the plans, policies and practices of the Company.


 


(c)           Without Cause By the Company.  The Employment Term and Executive’s
employment hereunder may be terminated by the Company without “Cause.”  If Executive’s employment is terminated by the
Company without “Cause” (other than by reason of Disability or death), Executive
shall be entitled to receive (i) any accrued and unpaid Base Salary and
Benefits, (ii) continuation of Executive’s Base Salary for a period of
twelve (12) months from the date of termination (the “Severance Payment”),
(iii) continuation of Executive’s health and dental insurance coverage on
the same basis as those benefits are generally made available to other
executives of the Company for a period of twelve (12) months from the date of
termination and (iv) a Pro Rata Bonus. 
Upon termination of Executive’s employment by the Company without Cause
pursuant to this Section 12(c), Executive shall have no additional rights
to any compensation or any other benefits under this Agreement.  All other benefits, if any, due Executive
following Executive’s termination of employment by the Company without Cause
shall be determined in accordance with the plans, policies and practices of the
Company.


 


(d)           Voluntary Termination By Executive.  Executive shall provide the Company thirty
(30) days’ advance written notice in the event Executive terminates Executive’s
employment, other than for Good Reason (as hereinafter defined); provided
that the President may, in his sole discretion, terminate Executive’s
employment with the Company prior to the expiration of the thirty-day notice
period.  In such event and upon the
expiration of such thirty-day period (or such shorter time as the President in his
sole discretion may determine), Executive’s employment under this Agreement shall
immediately and automatically terminate, and Executive shall be limited to receiving
any Base Salary earned and unpaid as of Executive’s termination date.


 


(e)           Termination For Good Reason.  Executive may terminate Executive’s
employment hereunder for “Good Reason” at any time during the Employment Term.  For purposes of the Agreement, “Good Reason”
shall mean (i) a material breach of the terms of this Agreement by the
Company, (ii) the Company requiring Executive to move Executive’s primary
place of employment more than thirty-five (35) miles from the then current
place of employment, if such move materially increases Executive’s commute, or (iii) a
material diminution of Executive’s responsibilities, provided that any
of the foregoing is not cured by the Company within twenty (20) days following
receipt of written notice by Executive to the Company of the specific nature of
the breach.  No termination for Good
Reason shall be permitted unless the Company shall have first received written
notice from Executive describing the basis 


 

















 


of such termination for Good
Reason.  A termination of Executive’s
employment for Good Reason pursuant to this Section 12(e) shall be
treated for purposes of this Agreement as a termination by the Company without
Cause and the provisions of Section 12(c) relating to the payment of
compensation and benefits shall apply.


 


(f)            Benefits/Release.  In addition to any amounts which may be
payable following a termination of employment pursuant to one of the paragraphs
of this Section 12, Executive or Executive’s beneficiaries shall be entitled
to receive any benefits that may be provided for under the terms of an employee
benefit plan in which Executive is participating at the time of termination.  Notwithstanding any other provision of this
Agreement to the contrary, Executive acknowledges and agrees that any and all
payments, other than the payment of any accrued and unpaid Base Salary and
Benefits, to which Executive is entitled under this Section 12 are conditioned
upon and subject to Executive’s execution of a general waiver and release, in
such form as may be prepared by the Company’s attorneys, of all claims and
issues arising under the Employment Agreement, except for such matters covered
by provisions of this Agreement which expressly survive the termination of this
Agreement.


 


(g)           Except
as provided in this Section 12, the Company shall have no further
obligation or liability under this Agreement following a termination of
employment by Executive.


 


(h)           Notice of Termination.  Any purported termination of employment by
the Company or by Executive shall be communicated by written notice of
termination to the other party hereto in accordance with Section 17(h) hereof.


 


13.                               Non-Competition.


 


(a)           Executive
acknowledges and recognizes the highly competitive nature of the businesses of
the Company and its affiliates, the valuable confidential business information
in such Executive’s possession and the customer goodwill associated with the
ongoing business practice of the Company, and accordingly agrees as follows:


 


(i)            During
the Employment Term and, for a period ending on the expiration of one year
following the termination of Executive’s employment (the “Restricted Period”),
Executive will not directly or indirectly, (i) engage in any business for Executive’s
own account that competes with the business of the Company, (ii) enter the
employ of, or render any services to, any person engaged in any business that
competes with the business of the Company, (iii) acquire a financial
interest in, or otherwise become actively involved with, any person engaged in
any business that competes with the business of the Company, directly or
indirectly, as an individual, partner, shareholder, officer, director,
principal, agent, trustee or consultant, or (iv) interfere with business
relationships (whether formed before or after the date of this Agreement)
between the Company or any of its affiliates that are engaged in a business
similar to the business of the Company (the “Company Affiliates”) and
customers or suppliers of the Company or the Company Affiliates.


 

















 


(ii)           Notwithstanding
anything to the contrary in this Agreement, Executive may directly or
indirectly own, solely as a passive investment, securities of any person
engaged in the business of the Company which are publicly traded on a national
or regional stock exchange or on the over-the-counter market if Executive (i) is
not a controlling person of, or a member of a group which controls, such person
and (ii) does not, directly or indirectly, own one percent (1%) or more of
any class of securities of such person.


 


(iii)          During
the Restricted Period, and for an additional one year after the end of the
Restricted Period, Executive will not, directly or indirectly, (i) without
the written consent of the Company, solicit or encourage any employee of the
Company or the Company Affiliates to leave the employment of the Company or the
Company Affiliates, or (ii) without the written consent of the Company
(which shall not be unreasonably withheld), hire any such employee who has left
the employment of the Company or the Company Affiliates (other than as a result
of the termination of such employment by the Company or the Company Affiliates)
within one year after the termination of such employee’s employment with the Company
or the Company Affiliates.


 


(iv)          During
the Restricted Period, Executive will not, directly or indirectly, solicit or
encourage to cease to work with the Company or the Company Affiliates any
consultant then under contract with the Company or the Company Affiliates.


 


(b)           It
is expressly understood and agreed that although Executive and the Company
consider the restrictions contained in this Section 13 to be reasonable,
if a final judicial determination is made by a court of competent jurisdiction
that the time or territory or any other restriction contained in this Agreement
is an unenforceable restriction against Executive, the provisions of this
Agreement shall not be rendered void but shall be deemed amended to apply as to
such maximum time and territory and to such maximum extent as such court may
judicially determine or indicate to be enforceable.  Alternatively, if any court of competent
jurisdiction finds that any restriction contained in this Agreement is
unenforceable, and such restriction cannot be amended so as to make it
enforceable, such finding shall not affect the enforceability of any of the
other restrictions contained herein.


 


14.                               Confidentiality.  Executive will not at any time (whether during
or after Executive’s employment with the company) disclose or use for Executive’s
own benefit or purposes or the benefit or purposes of any other person, firm, partnership,
joint venture, association, corporation or other business organization, entity
or enterprise other than the Company and any of its subsidiaries or affiliates,
any trade secrets, information, data, or other confidential information
relating to customers, development programs, costs, marketing, trading,
investment, sales activities, promotion, credit and financial data,
manufacturing processes, financing methods, plans, or the business and affairs
of the Company generally, or of any subsidiary or affiliate of the Company, provided
that the foregoing shall not apply to information which is generally known to
the industry or the public other than as a result of Executive’s breach of this
covenant.  Executive agrees 


 

















 


that upon termination of
Executive’s employment with the Company for any reason, he will return to the
Company immediately all memoranda, books, papers, plans, information, letters
and other data, and all copies thereof or therefrom, in any way relating to the
business of the Company and its affiliates, except that he may retain personal
notes, notebooks and diaries.  Executive
further agrees that he will not retain or use for Executive’s account at any
time any trade names, trademark or other proprietary business designation used
or owned in connection with the business of the Company or its affiliates.


 


15.                               Specific
Performance.  Executive acknowledges
and agrees that the Company’s remedies at law for a breach or threatened breach
of any of the provisions of Section 13 or Section 14 would be
inadequate and, in recognition of this fact, Executive agrees that, in the
event of such a breach or threatened breach, in addition to any remedies at
law, the Company, without posting any bond, shall be entitled to obtain
equitable relief in the form of specific performance, temporary restraining
order, temporary or permanent injunction or any other equitable remedy which
may then be available.


 


16.                               Independence,
Severability and Non-Exclusivity.  Each
of the rights and remedies set forth in this Agreement shall be independent of
the others and shall be severally enforceable and all of such rights and
remedies shall be in addition to and not in lieu of any other rights and
remedies available to the Company or its affiliates under the law or in equity.  If any of the provisions contained in this
Agreement, including without limitation, the rights and remedies enumerated herein,
is hereafter construed to be invalid or unenforceable, the same shall not
affect the remainder of the covenant or covenants, or rights or remedies, which
shall be given full effect without regard to the invalid portions.


 


17.                               Miscellaneous.


 


(a)           Governing Law.  This Agreement shall be governed by and
construed in accordance with the laws of the State of Florida without regard to
its conflicts of law doctrine.


 


(b)           Entire Agreement/Amendments.  This Agreement contains the entire
understanding of the parties with respect to the employment of Executive by the
Company.  There are no restrictions,
agreements, promises, warranties, covenants or undertakings between the parties
with respect to the subject matter herein other than those expressly set forth
herein.  This Agreement may not be
altered, modified, or amended except by written instrument signed by the
parties hereto.


 


(c)           No Waiver.  The failure of a party to insist upon strict
adherence to any term of this Agreement on any occasion shall not be considered
a waiver of such party’s rights or deprive such party of the right thereafter
to insist upon strict adherence to that term or any other term of this
Agreement.


 

















 


(d)           Severability.  In the event that any one or more of the
provisions of this Agreement shall be or become invalid, illegal or unenforceable
in any respect, the validity, legality and enforceability of the remaining
provisions of this Agreement shall not be affected thereby.


 


(e)           Assignment.  This Agreement shall not be assignable by Executive.  This Agreement may be assigned by the Company
to a company which is a successor in interest to substantially all of the
business operations of the Company or to the financial institution(s) providing
the Company’s senior credit facility.  Such
assignment shall become effective when the Company notifies Executive of such
assignment or at such later date as may be specified in such notice.  Upon such assignment, the rights and
obligations of the Company hereunder shall become the rights and obligations of
such successor company, provided that any assignee expressly assumes the
obligations, rights and privileges of this Agreement.


 


(f)            No Mitigation.  Executive shall not be required to mitigate
the amount of any payment provided for pursuant to this Agreement by seeking
other employment and, to the extent that Executive obtains or undertakes other
employment, the payment will not be reduced by the earnings of Executive from
the other employment.


 


(g)           Successors; Binding Agreement.  This Agreement shall inure to the benefit of
and be binding upon personal or legal representatives, executors,
administrators, successors, heirs, distributes, devises and legatees.


 


(h)           Notice.  For the purpose of this Agreement, notices and
all other communications provided for in the Agreement shall be in writing and
shall be deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, addressed, in the
case of Executive, to Executive’s address on file with the Company; all notices
to the Company shall be directed to the attention of the President or to such
other address as either party may have furnished to the other in writing in
accordance herewith, except that notice of change of address shall be effective
only upon receipt.


 


(i)            Withholding Taxes.  The Company may withhold from any amounts
payable under this Agreement such Federal, state and local taxes as may be
required to be withheld pursuant to any applicable law or regulation.


 


(j)            Counterparts.  This Agreement may be signed in counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.


 

















 


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


 


	
   

  	
  INTERLINE
  BRANDS, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   /s/
  Michael J. Grebe

  
	
   

  	
   

  	
  Name:
  Michael J. Grebe

  
	
   

  	
   

  	
  Title:    Chairman and CEO

  
	
   

  	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/
  Kenneth D. Sweder