Document:

Exhibit 10.1

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

EMPLOYMENT AGREEMENT (“Agreement”) dated as of March 12, 2004
between 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 future
employment with the Company; and

 

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

 

Accordingly, the parties agree as follows:

 

1.                                       Employment,
Duties and Acceptance.

 

1.1                                 Employment
by the Company.  The Company shall
employ the Executive effective as of March 15, 2004 (the “Effective Date”)
to render exclusive, subject to the last sentence of this Section 1.1, and
full-time services to the Company.  The
Executive will serve in the capacity of Executive Vice President and, effective
as of April 1, 2004, Chief Financial Officer, and such other positions of
the Company or its subsidiaries as designated by the Company and shall report
to the President and/or Chief Executive Officer of the Company.  The Executive will perform such lawful
duties related to the business of the Company as are imposed on the holder of
that office by the By-laws and other constituent documents of the Company and
such other lawful duties related to the business of the Company as are
customarily performed by one holding such positions in the same or similar
businesses or enterprises as those of the Company.  The Executive will perform such other lawful duties related to
the business of the Company as may be assigned to him from time to time by the
President and/or Chief Executive Officer of the Company or the Board of
Managers of the Company, either directly or indirectly through its
Chairman.  The Executive will devote all
his full working-time and attention to the performance of such duties and to
the promotion of the business and interests of the Company.  This provision, however, will not prevent
the Executive from investing his funds or assets in any form or manner, or from
acting as an advisor to or a member of, the board of directors of any
companies, businesses, or charitable organizations, so long as such actions do
not violate the provisions of Section 5 of this Agreement or interfere
with the Executive’s performance of his duties hereunder.

 

1.2                                 Acceptance
of Employment by the Executive.  The
Executive accepts such employment and shall render the services described
above.

 

2.                                       Duration
of Employment.

 

Subject to Section 4 of this Agreement, this Agreement and the
employment relationship hereunder will continue in effect for one (1) year from
the Effective Date  (the “Initial Term”), and the terms of
this 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

 

 

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

 

3.                                       Compensation
by the Company.

 

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

 

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

 

3.3                                 Participation
in Employee Benefit Plans.  The
Executive 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 plan
of the Company, which may be available to other executives of the Company
generally, on the same terms as such other executives; provided, however, the
Executive has informed the Company that he shall not elect coverage under the
hospitalization plan and health program..

 

3.4                                 Car
Allowance.  The Executive shall be
entitled to a monthly car allowance equal to One Thousand Two Hundred Fifty
Dollars ($1,250), subject to quarterly review and reduction by the Company;
provided that such reduction shall not result in an amount less than Six Hundred
Dollars ($600).

 

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

 

3.6                                 Expense
Reimbursement.  During the Term, the
Executive shall be entitled to receive prompt 
reimbursement of all reasonable out-of-pocket expenses properly incurred
by him in connection with his duties under this Agreement, including reasonable
expenses of entertainment and travel, provided that such expenses are
documented and reported in accordance with the policies and procedures of the Company
or the Board of Managers, as applicable, at the time the expenses are incurred.

 

3.7                                 Vesting
Units.  As of the Effective Date,
the Executive shall be allowed, for a period of thirty (30) days from the
Effective Date, to purchase up to two hundred and forty (240) of the Company’s
common 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 (shall
vest) as follows:  Forty (40) of the
Restricted Units shall vest upon each of December 31, 2004, 2005 and 2006;
provided the Executive is employed with the Company on each applicable vesting
date.  Another forty (40) of the
Restricted Units shall vest upon receipt of the audited financial statements of
the Company for the years ending December 31, 2004, 2005 and 2006;
provided that the applicable IRR Targets for each such year are achieved and
the Executive is employed with the Company on each applicable vesting
date.  The purchase of the Restricted
Units shall be subject to a Vesting Unit Repurchase Agreement, the Company’s
Operating Agreement and Management Subscription Agreement.  Capitalized terms not defined herein shall
have the meanings ascribed to such terms under the Vesting Unit Repurchase
Agreement.

 

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

 

4.                                       Termination.

 

4.1                                 Termination
Upon Death.  If the Executive dies
during the Term, the Executive’s legal representatives shall be entitled to
receive the Executive’s Base Salary and accrued bonus for the period ending on
the last day of the month in which the death of the Executive occurs.

 

4.2                                 Termination
Upon Disability.  If during the Term
the Executive’s employment with the Company is terminated as a result of a
“Disability” (as defined in the Disability Policy), the Executive (or his legal
representatives) shall be entitled to receive the benefits set forth in
Section 3.3 hereof applicable to a Disability.

 

4.3                                 Termination
for Cause.  The Executive’s employment
hereunder 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’s
continued failure to substantially perform the Executive’s duties, (b) failure
to follow the lawful directions of the President and Chief Executive Officer of
the Company or the Board of Managers of the Company, either directly or
indirectly through its Chairman, (c) material, willful acts of dishonesty,
theft or fraud resulting or intending to result in personal gain or enrichment
at the expense of the Company, (d) commission of a felony, (e) a violation of
any written policy of the Company including, but not limited to, the Company’s
employment manuals, rules and regulations which materially and adversely
affects the Company or could reasonably be expected to materially and adversely
affect the Company, or (f) the Executive engaging in any act that is intended,
or may reasonably be expected to materially harm the reputation, business or
operations of the Company or any member of its Board of Managers or (g) any
other material breach of this Agreement or any other agreement with the Company
that 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 and
ten (10) business days to cure the deficiency leading to the Cause
determination, if such deficiency is curable. 
Notwithstanding the foregoing and without limiting the foregoing in any
way, for the avoidance of doubt, the Executive shall receive written notice and
ten (10) business days to cure a deficiency under Section 4.3(a) or (b)
hereof.

 

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

 

4.4                                 Voluntary
Termination 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 without
Employee Good Reason, as defined in Section 4.6.  Upon a voluntary termination without Employee Good Reason, the
Executive shall be entitled to receive the Executive’s Base Salary through the
date of termination; provided, however, that if the Company shall waive part or
all of such sixty (60) but not more than ninety (90) day notice period, the
Executive shall only receive Base Salary to the date of termination specified
in such waiver.

 

4.5                                 Termination
by the Company Other Than For Cause.

 

(a)                                  The
Company may terminate the Executive’s employment at any time other than for
Cause.  If, prior to the expiration of
this Agreement, the Company terminates the Executive’s employment for any
reason other than Cause, then in lieu of additional salary payments to the
Executive for periods subsequent to the date of such termination, the Company
shall pay to the Executive (i) (A) if termination occurs prior to the first
anniversary of the Effective Date, his Base Salary for 6 months after
termination, (B) if termination occurs on or after the first anniversary but
prior to the second anniversary of the Effective Date, his Base Salary for 9
months after termination and (C) if termination occurs on or after the second
anniversary of the Effective Date, his Base Salary for 12 months after
termination, plus (ii) a pro rata portion of the bonus that is determined under
the 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 of
employment to the date of termination of employment multiplied by (A) 50% if
termination occurs prior to the first anniversary of the Effective Date, (B)
75% if termination occurs on or after the first anniversary but prior to the
second anniversary of the Effective Date and (C) 100% if termination occurs on
or after the second anniversary of the Effective Date and (iii) the Company
shall reimburse the Executive for the applicable premiums under COBRA to
receive insurance coverage from the Company commencing on the date of
termination through the date which is the earlier to occur of (1) expiration of
the applicable Term and (2) the day on which the Executive shall be included in
any insurance program provided by any other employer.

 

(b)                                 Nothing
contained in this Section 4.5 shall prevent the Executive from receiving
any and all benefits payable under any severance benefit plan or program
maintained by the Company to which the Executive is entitled.

 

4.6                                 Voluntary
Termination with Employee Good Reason. 
(a)  The Executive may upon at
least sixty (60) days prior written notice to the Company terminate employment
hereunder 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 the
Executive for periods subsequent to the date of such termination, the Company
shall 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 is
determined under the 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 of employment to the date of termination of employment
and (iii) the Company shall reimburse the Executive for the applicable premiums
under COBRA to receive insurance coverage from the Company commencing on the
date of termination through the date which is the earlier to occur of (1) the
expiration of twelve (12) months after termination of employment and (2) the
day on which the Executive shall be included in any insurance program provided
by any other employer; provided, however, that if the Company shall waive part
or 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.

 

(b)                                 The
term “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 or
program (in each case, other than Base Salary) provided to the Executive for
any reason and without the Executive’s consent if such modification, suspension
or termination is consistent with modifications, suspensions or terminations
for other senior executive employees of the Company, (ii) a material reduction
in the Executive’s responsibilities or duties (other than a change in the
number or identity of persons reporting to the Executive) or the title of Executive
Vice President and (after April 1, 2004) Chief Financial Officer or (iii)
the requirement by the Board of Managers of the Company that the Executive
relocate his residence from the Detroit, Michigan area; provided, that,
the Company shall have thirty (30) days after receipt of notice from the
Executive pursuant to this Section 4.6 to cure the deficiency resulting in
the termination with Employee Good Reason.

 

4.7                                 Removal
from any Boards and Positions.  If
the 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 the
Company or board of managers or board of directors of any subsidiary of the
Company or any other board to which he has been appointed or nominated by or on
behalf of the Company and (ii) from any position with the Company or any
subsidiary of the Company, including, but not limited to, as an officer of the
Company or any of its subsidiaries.

 

5.                                       Restrictions
and Obligations of the Executive.

 

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

 

5

 

forms concerning how the Company creates, develops, acquires or
maintains its products and marketing plans, targets its potential customers and
operates its retail and other businesses. 
The Company invested, and continues to invest, considerable amounts of
time and money in its process, technology, know-how, obtaining and developing
the goodwill of its customers, its other external relationships, its data
systems and data bases, and all the information described above (hereinafter
collectively referred to as “Confidential Information”), and any
misappropriation or unauthorized disclosure of Confidential Information in any
form would irreparably harm the Company. 
The Executive acknowledges that such Confidential Information
constitutes valuable, highly confidential, special and unique property of the
Company.  The Executive shall hold in a
fiduciary capacity for the benefit of the Company all Confidential Information
relating to the Company and its business, which shall have been obtained by the
Executive during the Executive’s employment by the Company or predecessor of
the Company and which shall not be or become public knowledge (other than by
acts by the Executive or representatives of the Executive in violation of this
Agreement).  Except as required by law
or an order of a court or governmental agency with jurisdiction, the Executive
shall not, during the period the Executive is employed by the Company or at any
time thereafter, disclose any Confidential Information, directly or indirectly,
to any person or entity for any reason or purpose whatsoever, nor shall the
Executive use it in any way, except in the course of the Executive’s employment
with, and for the benefit of, the Company or to enforce any rights or defend
any claims hereunder or under any other agreement to which the Executive is a
party, provided that such disclosure is relevant to the enforcement of such
rights or defense of such claims and is only disclosed in the formal
proceedings related thereto.  The
Executive shall take all reasonable steps to safeguard the Confidential
Information and to protect it against disclosure, misuse, espionage, loss and
theft.  The Executive understands and
agrees that the Executive shall acquire no rights to any such Confidential
Information.

 

(b)                                 All
files, records, documents, drawings, specifications, data, computer programs,
evaluation mechanisms and analytics and similar items relating thereto or to
the Business (for the purposes of this Agreement, “Business” shall be as
defined in Section 5.3 hereof), as well as all customer lists, specific
customer information, compilations of product research and marketing techniques
of the Company, whether prepared by the Executive or otherwise coming into the
Executive’s possession, shall remain the exclusive property of the Company, and
the 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.

 

(c)                                  It
is understood that while employed by the Company the Executive will promptly
disclose to it, and assign to it the Executive’s interest in any invention,
improvement or discovery made or conceived by the Executive, either alone or
jointly with others, which arises out of the Executive’s employment.  At the Company’s request and expense, the
Executive will assist the Company during the period of the Executive’s
employment by the Company and thereafter in connection with any controversy or
legal proceeding relating to such invention, improvement or discovery and in obtaining
domestic and foreign patent or other protection covering the same.

 

(d)                                 As
requested by the Company and at the Company’s expense, from time to time and
upon the termination of the Executive’s employment with the Company for any
reason, the Executive will promptly deliver to the Company all copies and

 

6

 

embodiments, in whatever form, of all Confidential Information in the
Executive’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 Executive
will provide the Company with written confirmation that all such materials have
been delivered to the Company as provided herein.

 

5.2                                 Non-Solicitation
or Hire.  During the Term and (i)
for a three (3) year period following a termination of the Executive’s
employment by the Company for Cause or a voluntary termination by the Executive
without Employee Good Reason or (ii) for eighteen (18) months following the
termination of the Executive’s employment by the Executive with Employee Good
Reason 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 its
subsidiaries, or who was a customer of the Company or its subsidiaries at any
time during the twelve (12) month period immediately prior to the relevant
date, for the purpose of marketing, selling or providing to any such party any
services or products offered by or available from the Company or its
subsidiaries and relating to the Business (provided that if the Executive
intends to solicit any such party for any other purpose, he shall notify the
Company 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 its
subsidiaries at the time of termination or who was an employee of the Company
or any of its subsidiaries at any time during the six (6) month period
immediately prior to any such solicitation or employment.

 

5.3                                 Non-Competition.  During the Term and (i) for a three (3) year
period  following a termination of the
Executive’s employment by the Company for Cause or a voluntary termination by
the Executive without Employee Good Reason or (ii) for eighteen (18) months
following the termination of the Executive’s employment by the Executive with
Employee Good Reason or by the Company without Cause, the Executive shall not
directly or indirectly, whether individually, as a director, manager, member,
stockholder, partner, owner, employee, consultant or agent of any business, or
in any other capacity, other than on behalf of the Company or an affiliate or
successor of the Company, organize, establish, own, operate, manage, control,
engage in, participate in, invest in, permit his name to be used by, act as a
consultant or advisor to, render services for (alone or in association with any
person, firm, corporation or business organization), or otherwise assist any
person or entity that engages in or owns, invests in, operates, manages or
controls any venture or enterprise which directly or indirectly, engages or
proposes to engage in (A) designing, engineering, manufacturing, selling or
distributing (x) towing systems and roof rack systems and related accessories
or (y) any other product which the Company designs, engineers, manufactures,
sells or distributes on or prior to the termination of the Executive’s
employment (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 engages
or proposes to engage in such Business. 
Notwithstanding the foregoing, nothing in this Agreement shall prevent
the Executive from owning for passive investment purposes not intended to
circumvent this Agreement, less than five percent (5%) of the publicly traded
equity securities of any competing enterprise (so long as the Executive has no
power to manage, operate, advise, consult with or control the competing
enterprise and no power, alone or in conjunction with other affiliated

 

7

 

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

 

5.4                                 Reputation.  The Executive agrees not to engage in any
act that is intended, or may reasonably be expected to materially harm the
reputation, business, prospects or operations of the Company, any member of its
Board of Managers, Castle Harlan, Inc. or Castle Harlan, Partners IV, L.P., in
either case, unless as required by law or an order of a court or governmental
agency with jurisdiction

 

5.5                                 Property.  The Executive acknowledges that all
originals and copies of materials, records and documents generated by him or
coming into his possession during his employment by the Company are the sole
property of the Company (“Company Property”). 
During the Term, and at all times thereafter, the Executive shall not
remove, or cause to be removed, from the premises of the Company, copies of any
record, 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 employment
with the Company, or upon request of the Company at any time, the Executive
shall promptly deliver to the Company all copies of Company Property in his
possession or control.

 

5.6                                 Work
Product.  The Executive agrees that
all inventions, discoveries, systems, interfaces, protocols, concepts, formats,
creations, developments, designs, programs, products, processes, investment
strategies, materials, computer programs or software, data bases, improvements,
or other properties related to the business of the Company or any of its
affiliates, conceived, made or developed during the term of his employment with
the Company, whether conceived by the Executive alone or working with others,
and whether patentable or not (the “Work Product”), shall be owned by and
belong exclusively to the Company.  The
Executive hereby assigns to the Company his entire rights to the Work Product
and agrees to execute any documents and take any action reasonably requested by
the Company (at the Company’s sole cost and expense) to protect the rights of
the Company in any Work Product.  The
Executive acknowledges that any copyrightable subject matter created by the
Executive within the scope of his employment, whether containing or involving
Confidential Information or not, is deemed a work-made-for-hire under Chapter
17 of the United States Code, entitled “Copyrights,” as amended, and the Company
shall be deemed the sole author and owner thereof for any purposes
whatsoever.  In the event of any
unauthorized publication of any Confidential Information, the Company shall
automatically own the copyright in such publication.  Further, the Company shall automatically hold all patents and/or
trademarks, if any, with respect to any Work Product.

 

6.                                       Other
Provisions.

 

6.1                                 Notices.  Any notice or other communication required
or 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 so
delivered personally, telegraphed, telexed, or sent by facsimile transmission
or, if mailed, four (4) days after the date of mailing, as follows:

 

8

 

	
  (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.

  
				

 

6.2                                 Entire
Agreement.  This Agreement contains
the entire agreement between the parties with respect to the subject matter
hereof and supersedes all prior agreements, written or oral, with respect
thereto.

 

6.3                                 Representations
and Warranties by Executive.  The
Executive represents and warrants that he is not a party to or subject to any
restrictive covenants, legal restrictions or other agreements in favor of any
entity or person which would in any way

 

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

 

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

 

6.5                                 Governing
Law.  This Agreement shall be
governed and construed in accordance with the laws of the State of New York
applicable to agreements made and to be performed entirely within such state,
without regard to conflicts of laws principles.

 

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

 

6.7                                 Counterparts.  This Agreement may be executed in
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument.

 

6.8                                 Headings.  The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning of terms contained herein.

 

6.9                                 Remedies;
Specific Performance.  The parties
hereto hereby acknowledge that the provisions of Section 5 are reasonable
and necessary for the protection of the Company.  In addition, the Executive further acknowledges that the Company
will be irrevocably damaged if such covenants are not specifically
enforced.  Accordingly, the Executive
agrees that, in addition to any other relief to which the Company may be
entitled, the Company will be entitled to seek and obtain injunctive relief
(without the requirement of any bond) from a court of competent jurisdiction
for the purposes of restraining the Executive from any actual or threatened
breach of such covenants.  In addition,
without limiting the Company’s remedies for any breach of any restriction on
the Executive set forth in Section 5, in the event of such breach, the
Company will have no obligation to pay any of the amounts that remain payable
by the Company under Section 4.

 

6.10                           Severability.  If any term, provision, covenant or
restriction of this Agreement, or any part thereof, is held by a court of
competent jurisdiction of any foreign, federal, state, county or local
government or any other governmental, regulatory or administrative agency or authority
to be invalid, void, unenforceable or against public policy for any reason, the
remainder of the terms, provisions, covenants and restrictions of this
Agreement shall remain in full force and effect and shall in no way be affected
or impaired or invalidated.

 

10

 

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

 

6.11                           Judicial
Modification.  If any court or
arbitrator determines that any of the covenants in Section 5, or any part
of any of them, is invalid or unenforceable, the remainder of such covenants
and 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 any
part thereof, is invalid or unenforceable because of the geographic or temporal
scope of such provision, such court or arbitrator shall reduce such scope to
the minimum extent necessary to make such covenants valid and enforceable.

 

6.12                           Tax
Withholding.  The Company or other
payor is authorized to withhold, from any benefit provided or payment due
hereunder, the amount of withholding taxes due any federal, state or local
authority in respect of such benefit or payment and to take such other action
as may be necessary in the opinion of the Board of Managers of the Company to
satisfy all obligations for the payment of such withholding taxes.

 

11

 

IN WITNESS WHEREOF, the parties hereto, intending to be legally bound
hereby, have executed this Agreement as of the day and year first above
mentioned.

 

	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
        /s/ Ronald J Gardhouse

  
	
   

  	
  Ronald J. Gardhouse

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CHAAS HOLDINGS, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Terence C. Seikel

  	
   

  
	
   

  	
   

  	
  Name:     Terence C. Seikel

  
	
   

  	
   

  	
  Title:

  

 

12Exhibit
10.20

 

AGREEMENT

 

AGREEMENT (“Agreement”)
dated as of the 27th day of February, 2004, between BED BATH & BEYOND, INC.
(the “Employer”) and WARREN EISENBERG, individually (the “Executive”).

 

W I T N E S S E T H

 

WHEREAS:

 

A.                                   The Employer and the Executive are parties to
an Agreement to Terminate Split-Dollar Agreements, dated November 30,
2003, pursuant to which certain split-dollar life insurance agreements and
related collateral assignments which provided for $30 million of life insurance
coverage were terminated (the “Split-Dollar Arrangements”);

 

B.                                     In connection with such termination the
Executive caused the Company to be paid $2,996,941, being the total amount of
premiums paid by the Employer under the Split-Dollar Arrangements.  In addition, in connection with such
termination, the Company was released from its contractual obligation to make
future premium payments. The payment and release constitutes a substantial cost
saving to the Employer; and

 

C.                                     The Employer wishes to confer a benefit upon
the Executive in substitution for the benefit previously conferred on the
Executive pursuant to the Split-Dollar Arrangements.

 

NOW,
THEREFORE, in consideration of the mutual promises made by
each party to the other, and of the mutual agreements contained herein, the
parties hereto agree as follows:

 

1.                                       Recitals.  The above recitals are incorporated herein
by reference as though fully set forth at length herein.

 

2.                                       Substitute Benefit Payment .

 

(a)                                  The Employer hereby
irrevocably agrees to pay Two Million One Hundred Twenty-Five Thousand Dollars
($2,125,000) to the Executive on the last day of the first full fiscal year of
the Employer in which the total compensation of the Executive will not result
in the loss of a deduction for federal income tax purposes for the Employer
pursuant to the provisions of Section 162(m) of the Internal Revenue Code
of 1986, as amended, or any similar or successor provision (the “Provisions”),
provided that, in the event the Provisions are changed in a manner that would
result in the payments in materially all events being nondeductible then such
amount shall be paid at such time as it would have been paid if such change in
law had not been made.

 

(b)                                 Employer shall be obligated
to make the payment referred to in this Section 2 whether or not the
Executive is then in the employ of the Employer, and if not, regardless of the
reason for termination of the Executive’s employment including, without
limitation, voluntary termination, termination by the Employer for cause, and
death of the Executive.

 

3.                                       Choice of Law.  This Agreement shall be governed by the
internal law of the State of New York, without reference to principles of
conflict of laws, except to the extent preempted by the Employee Retirement
Income Security Act of 1974, as amended.

 

4.                                       Unfunded Arrangement.  The payment to the Executive under this Agreement shall be made
from the general assets of the Employer. 
No person shall have any interest in any such assets by virtue of the
provisions of Section 2.  The
Employer’s obligation under Section 2 shall be an unfunded and unsecured
promise to pay money in the future, and no provision shall at any time be made
with respect to segregating any assets of the Employer for payment of any
benefits due hereunder.  The Executive’s
right to

 

 

receive
the payment from the Employer pursuant to 
Section 2 shall be no greater than the right of any unsecured
general creditor of the Employer, and the Executive shall not have nor acquire
any legal or equitable right, interest or claim in or to any property or assets
of the Employer.  The Executive shall
not have any power or right to transfer, assign or otherwise encumber any part
or all of the amount payable hereunder, and any attempt to do so shall be null
and void.  The amount payable hereunder
shall not be subject to attachment, garnishment, levy, execution or other legal
or equitable process.

 

5.                                       Entire Agreement.  This Agreement sets forth the entire
understanding of the parties with respect to the transaction contemplated
hereby and supersedes all prior agreements, arrangements and understandings
relating to the subject matter hereof. 
This Agreement may be amended only by a written instrument executed by
the parties hereto.

 

6.                                       Miscellaneous.

 

(a)                                  All payments made hereunder shall be subject
to all taxes and withholding required by law.

 

(b)                                 This Agreement shall be binding upon, and
inure to the benefit of, the successors and permitted assigns of the parties
hereto.  This Agreement shall not be
assignable by the Executive, and shall be assignable by the Employer only to an
acquirer of all or substantially all of the assets of the Employer, provided
such acquirer promptly assumes all of the obligations hereunder in a writing
delivered to the Executive.

 

(c)                                  In the event of the Executive’s death, any
amounts payable hereunder shall be paid to the Executive’s estate.

 

7.                                       Headings.  The headings of the sections are for
convenience only and shall not control or affect the meaning or construction or
limit the scope or intent of any of the provisions of this Agreement.

 

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

 

	
  ATTEST:

  	
  EMPLOYER:

  
	
   

  	
   

  
	
   

  	
  BED BATH & BEYOND, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Steven H. Temares

  	
   

  
	
   

  	
   

  	
  Steven H. Temares, President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  EXECUTIVE:

  
	
   

  	
   

  
	
   

  	
  /s/ Warren Eisenberg

  	
   

  
	
   

  	
  WARREN EISENBERG, Individually

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