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EXHIBIT 10.3

EXECUTIVE EMPLOYMENT AGREEMENT

     THIS AGREEMENT is made and entered into as of the 1st day of March 2007 (the
“Effective Date”) by and between G&K SERVICES, INC., a Minnesota corporation with its principal
business office in the State of Minnesota (“Employer”, as further defined in Section 1.10 below);
and David M. Miller, a resident of the State of Minnesota (“Executive”).

INTRODUCTION

     A. Employment. Employer has employed Executive as an executive under that Executive
Employment Agreement effective as of December 19, 2005, and now wishes to make available to
Executive certain new benefits and rights under this Executive Employment Agreement (the
“Agreement”). This Agreement is intended to fully supersede all previous agreements between them,
including without limitation that Executive Employment Agreement effective as of December 19, 2005,
except as otherwise specifically set forth herein. As such, Executive is subject to the same
polices, terms and conditions as those described in the Employer’s employee handbook, its Code of
Ethics, policies, and employee benefit plans (as modified from time to time by Employer), except as
otherwise specifically provided in this Agreement.

     B. Protection of Employer. Employer further wishes to obtain Executive’s promises
related to Notice of Termination as set forth in this Agreement, as well as Executive’s promises
not to harm Employer following execution of this Agreement, particularly with respect to Employer’s
Confidential Information, as more fully described in Article 7. In Executive’s position with
Employer, Executive is a valued employee of Employer and Employer will benefit from Executive’s
continued employment as an executive, and further Executive will have access to and control over
Employer’s Confidential Information, which Employer has developed at great expense, time and
effort. As a result, voluntary termination by Executive without adequate notice, or Executive’s
disclosure of any Confidential Information, could cause irreparable harm to Employer, and Employer
is not willing to extend to Executive the additional benefits, rights and responsibilities under
this Agreement unless Executive agrees, as set forth in this Agreement, to provide Employer with
reasonable notice of voluntary termination of him employment, reasonable protection for its
Confidential Information, and assurances to protect Employer in other ways set forth in Article 7.

     C. Employment and Benefits. For these purposes, Employer is willing to continue
retaining Executive as an executive and to grant to Executive benefits to which Executive is not
otherwise entitled, consisting of the right to receive certain separation pay, continued health and
dental care coverage, perquisites, and outplacement benefits [as described in Articles 5 and 6], if
Executive’s employment with Employer terminates under certain circumstances, including without
limitation in connection with a Change in Control [as defined at Section 6.1(c)].

     D. Other Intentions. Executive wishes to accept Employer’s offer to be retained as an
executive and of additional benefits set forth in this Agreement, to which Executive is not
otherwise entitled.

     Executive agrees, as a condition of Employer’s offer of additional benefits set forth in this
Agreement, to sign this Agreement in order that Employer may have reasonable protections against
the disclosure of its Confidential Information, assurance of Executive’s adherence to him other
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under Article 7 of this Agreement, and certain protections related to Notice of Termination as set
forth in this Agreement.

AGREEMENT

     In consideration of the facts recited above, which are a part of this Agreement, and the
parties’ mutual undertakings in this Agreement, Employer and Executive agree to the following:

ARTICLE 1

DEFINITIONS

     Capitalized terms used generally in this Agreement will be consistently defined throughout the
Agreement. The following terms will have the meanings set forth below, unless the context clearly
requires otherwise.

     1.1 “Agreement” means this Agreement, as it may be amended from time to time.

     1.2 “Base Salary” means the total annual cash compensation payable to Executive on a regular
periodic basis under this Agreement, other than under Employer’s annual management incentive Plan,
without regard to any voluntary salary deferrals or reductions to fund employee benefits.

     1.3 “Board” means the Board of Directors of Employer.

     1.4 “Cause” has the meaning set forth in Section 4.3.

     1.5 “Change in Control” has the meaning set forth in Section 7.1(c).

     1.6 “Confidential Information” has the meaning set forth in Section 7.1.

     1.7 “Date of Termination” has the meaning set forth in Section 4.2(a).

     1.8 “Disability” means the unwillingness or inability of Executive to perform the essential
functions of Executive’s position (with or without reasonable accommodation) under this Agreement
for a period of ninety (90) days (consecutive or otherwise) within any period of six (6)
consecutive months because of Executive’s incapacity due to physical or mental illness, bodily
injury or disease, if Executive has not returned to the full-time performance of the Executive’s
duties within thirty (30) days after a Notice of Termination is issued by Employer, the Executive
will on such thirtieth day incur him Date of Termination; provided, however, that if Executive (or
Executive’s legal representative) does not agree with a determination of the existence of a
Disability (or the existence of a physical or mental illness or bodily injury or disease), this
determination will be subject to the certification of a qualified medical doctor mutually agreed to
by Employer and Executive. In the absence of agreement, each party will nominate a qualified
medical doctor and the two doctors will select a third doctor, who will make the determination as
to Disability. The decision of the designated physician will be binding upon the parties.

     1.9 “Effective Date” has the meaning referred to in the first paragraph of this Agreement.

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     1.10 “Employer” means all of the following, jointly and severally: (a) G&K Services, Inc., (b)
any Subsidiary of G&K Services, Inc. and (c) any Successor of G&K Services, Inc.

     1.11 “Executive” means the individual named in the first paragraph of this Agreement.

     1.12 “Good Reason,” with respect to Executive’s termination of employment after a Change in
Control, has the meaning set forth in Section 7.1(f)

     1.13 “Notice of Termination” has the meaning set forth in Section 4.2(b).

     1.14 “Plan” means any bonus or incentive compensation agreement, plan, program, policy or
arrangement sponsored, maintained or contributed to by Employer in which executive employees of
Employer generally are covered, including, without limitation, (a) any stock option or any other
equity-based compensation plan, and specifically the G&K Services, Inc. 2006 Equity Incentive Plan,
and any predecessor or successor Plan thereto [hereinafter the “Equity Incentive Plan"] (b) any
annual or long-term incentive bonus plan; (c) any employee benefit plan, such as a thrift, profit
sharing, deferred compensation, medical, dental, disability income, accident, life insurance,
automobile allowance, perquisite, fringe benefit, vacation, sick or parental leave, separation or
relocation plan or policy and (d) any other agreement, plan, program, policy or arrangement
intended to benefit executive employees of Employer.

     1.15 “Subsidiary” means any corporation or other business entity controlled by Employer.

     1.16 “Successor” means any corporation, individual, group, association, partnership, limited
liability company, firm, venture or other entity or person that, subsequent to the Effective Date,
succeeds to the actual or practical ability to control (either immediately or with the passage of
time) substantially all of Employer and/or Employer’s business and/or assets, directly or
indirectly, by merger, consolidation, recapitalization, purchase, liquidation, redemption,
assignment, similar corporate transaction, operation of law or otherwise.

ARTICLE 2

EMPLOYMENT AND DUTIES

     2.1 Employment. Upon the terms and conditions set forth in this Agreement, Employer
hereby employs and Executive accepts employment for an indefinite term. Executive will serve in the
capacity of President, U.S. Field Operations, or such other comparable senior leadership positions
as determined by Employer. This Agreement and Executive’s employment by Employer may be terminated
at any time and for any reason, with or without cause

     2.2 Duties. While Executive is employed under this Agreement, and excluding any
periods of vacation, sick, disability, or other leave to which Executive is entitled or is
authorized to take, Executive agrees to devote substantially all of Executive’s attention and time
during normal business hours to the business and affairs of Employer and to use Executive’s
reasonable best efforts to perform faithfully and efficiently such responsibilities assigned to
Executive from time to time. Executive will comply with each of Employer’s policies and
procedures, including those described in Employer’s employee handbook, Code of Ethics, policies,
and employee benefit plans, as modified from time to time by Employer; provided, however, that to
the extent these policies and procedures are inconsistent with this Agreement, the provisions of
this Agreement will control.

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     2.3 Relationship of Parties. The relationship between Employer and Executive will be
that of employer and employee. Except as otherwise specifically provided in this Agreement,
nothing in this Agreement will be construed to give Executive any interest in the assets of
Employer. All of the records and files pertaining to Employer’s suppliers, licensors, licensees
and customers, and any Confidential Information, are specifically acknowledged to be the property
of Employer and not that of Executive.

ARTICLE 3

COMPENSATION AND BENEFITS

     3.1 Base Salary. Employer shall pay Executive a Base Salary at an annual rate as
approved from time to time by the Board or the Compensation Committee of the Board, such Base
Salary to be paid in substantially equal regular periodic payments in accordance with Employer’s
regular payroll practices. If Executive’s Base Salary is changed at any time during Executive’s
employment by Employer, the changed amount shall become the Base Salary under this Agreement,
subject to any subsequent changes.

     3.2 Other Compensation and Benefits. While Executive is employed by Employer under
this Agreement:

     (a) Executive will be permitted to participate in all Plans for which Executive is or
becomes eligible under their respective terms.

     (b) Executive will be entitled to a target incentive opportunity under the annual
management incentive Plan in effect at Employer from time to time, including Executive’s
target incentive for fiscal year 2007 established by the Board of Directors.

     (c) Executive will also be entitled to participate in or receive benefits under any
Plan made available by Employer in the future to its executives, subject to and on a basis
consistent with the terms, conditions and overall administration of the Plans and the
provisions of this Section 3.2.

     (d) Executive will be entitled to any other fringe benefit or perquisite that the
Compensation Committee of the Board approves with respect to Executive.

     (e) Employer may, in its sole discretion, amend or terminate any Plan that provides
benefits generally to its employees, key management employees, or executive team members.

     3.3 Limitation on Right to Deferred Compensation. The rights of Executive, or
Executive’s beneficiaries or estate, to any deferred compensation under this Agreement will be
solely those of an unsecured creditor of Employer. Nothing in this Agreement confers any right on
Executive, any of Executive’s beneficiaries, or Executive’s estate to receive, assign rights under,
or transfer any compensation including any deferred compensation other than as provided for under
the applicable Plan.

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ARTICLE 4

TERMINATION

     Executive’s employment with the Employer may be terminated at any time as of the applicable
Date of Termination as follows; provided, however, that provisions contained in this Agreement
which by their terms are to remain enforceable after a Date of Termination shall remain enforceable
to the full extent necessary to give them effect:

     4.1 Termination. Except as specifically provided otherwise in this Agreement, this
Agreement and Executive’s employment with the Employer may be terminated by Employer or by
Executive, upon thirty (30) days advance written notice, or by Executive for any reason or no
reason, or at any time by mutual written agreement of the parties. During the period after notice
is given, at Employer’s request and sole discretion, Executive will continue to render Executive’s
normal service to Employer to the best of Executive’s ability, and Employer will continue to
compensate the Executive through the Date of Termination as set forth in Section 5.2. In addition,
this Agreement and Executive’s employment under this Agreement will terminate in the event of
Executive’s death or Disability, as of the applicable Date of Termination.

     4.2 Date of Termination and Notice of Termination.

     (a) For purposes of this Agreement, “Date of Termination” will mean: (i) if Executive’s
employment is terminated due to death, the date of Executive’s death; (ii) if Executive’s
employment is terminated for Disability, thirty (30) calendar days after the Notice of
Termination is provided; (iii) if Executive’s employment is terminated by Employer for
Cause, the date stated in the Notice of Termination; (iv) if Executive’s employment is
terminated by mutual agreement of the parties, the termination date provided for under the
agreement; (v) if Executive’s employment is terminated for any other reason, and subject to
the terms of Section 4.1 above, the date stated in the Notice of Termination, unless an
earlier date has been expressly agreed to by Executive in writing either before or after
receiving the Notice of Termination.

     (b) For purposes of this Agreement, a “Notice of Termination” will mean a notice that
indicates the date on which termination of Executive’s employment is effective. Any
termination by Employer or by Executive under to this Agreement [other than Executive’s
death, or a termination by mutual agreement] will be communicated to the other party by
submission of a written Notice of Termination. If termination is by Employer for Cause or
by Executive for Good Reason, the Notice of Termination will set forth in reasonable detail
the facts and circumstances claimed to provide the basis for the termination, consistent
with the terms of this Agreement.

     4.3 Termination by Employer for Cause. Employer may terminate Executive’s at will
employment at any time for Cause, with or without advance notice [except as otherwise provided in
this Section 4.3]. For purposes of this Agreement, “Cause” means any of the following, with respect
to Executive’s position of employment with Employer:

     (a) Executive’s failure or refusal to perform the duties and responsibilities as set
forth in Section 2.2, if the failure or refusal (i) is not due to a Disability or a physical
or mental

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illness or bodily injury or disease; or (ii) is not due to Executive’s reasonable best
efforts to perform faithfully and efficiently the responsibilities of him position with
Employer, acting in good faith in the interests of Employer, its shareholders and employees;

     (b) any drunkenness or use of drugs that interferes with the performance of Executive’s
obligations under this Agreement;

     (c) Executive’s indictment for or conviction of (including entering a guilty plea or
plea of no contest to) a felony or of any crime involving moral turpitude, fraud, dishonesty
or theft;

     (d) any material dishonesty of Executive involving or affecting Employer;

     (e) any gross negligence, or any willful or intentional act or omission of Executive
having the effect or reasonably likely to have the effect of injuring the reputation,
business or business relationships of Employer in a material way;

     (f) any willful or intentional breach by Executive of a fiduciary duty to Employer;

     (g) except as otherwise specifically provided in this Section 4.3, Executive’s material
violation or breach of Employer’s standard business practices and policies;

     (h) any court order or settlement agreement prohibits Executive’s continued employment
with Employer; or

     (i) any material breach by Executive [not covered by any of the above clauses (a)
through (h)] of any material term, provision or condition of this Agreement.

     Notwithstanding any of the foregoing, “Cause” shall not be deemed to exist unless and until
Employer provides Executive with (A) at least ten (10) days prior written notice of its intention
to terminate employment for Cause, together with a written statement describing the nature of the
Cause, including the clause or clauses of this definition that Employer deems applicable, and (B)
if the item constituting Employer’s “Cause” for termination of Executive is within the scope of
clauses (a), (b) (g) or (i) above, thirty (30) days to cure any acts or omissions on which the
finding of Cause is based. If the Executive cures, in accordance with the terms of the written
notice, the acts or omissions on which the finding of Cause is based, Employer shall not have Cause
to terminate the Executive’s employment under this Agreement.

     For purposes of this Section 4.3, no act, or failure to act, on Executive’s part will be
considered “dishonest,” “willful” or “intentional” unless done, or omitted to be done, by Executive
in bad faith and without reasonable belief that Executive’s action or omission was in or
not opposed to, the best interest of Employer. Any act, or failure to act, based upon authority
given pursuant to a resolution duly adopted by the Board or based upon the advice of counsel for
Employer will be conclusively presumed to be done, or omitted to be done, by Executive in good
faith and in the best interests of Employer. Furthermore, the term “Cause” will not include
ordinary negligence or failure to act, whether due to an error in judgment or otherwise, if
Executive has exercised substantial efforts in good faith to perform the duties reasonably assigned
or appropriate to the position.

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ARTICLE 5

PAYMENTS UPON TERMINATION

     5.1 Compensation during Disability. During any period in which Executive fails to
perform Executive’s duties under this Agreement as a result of Executive’s incapacity due to
physical or mental illness or bodily injury or disease, Executive will continue to receive all Base
Salary and other compensation and benefits to which Executive is otherwise entitled under this
Agreement and any Plan through Executive’s Date of Termination, but only to the extent that
Executive is not receiving substantially equivalent benefits under any Plan maintained by Employer.

     5.2 Compensation Until Date of Termination of Employment. If Executive’s employment
under this Agreement is terminated, then Employer will pay Executive the Base Salary through the
Date of Termination, plus any other amounts which Executive has earned, and to which Executive
therefore is entitled, prior to the Date of Termination under this Agreement and under any Plan as
provided under the Plan; provided that Executive continues to perform duties in accordance with
Article 2.

     5.3 Compensation Following Termination of Employment by Employer Without Cause. In
the event Executive’s employment under this Agreement is terminated by Employer without Cause, and
provided Executive shall first execute a written release substantially in the form attached to this
Agreement as Exhibit A consistent with this Section 5.3 (the “Release Agreement”), and provided
further that Executive has not exercised rights to revoke or rescind the release of claims under to
the Release Agreement, then Employer shall provide to Executive the following benefits:

     (a) Employer will pay to Executive, as Separation Pay, which Executive has not earned
and to which Executive is not otherwise entitled, an amount equal to eleven (11) months of
Executive’s monthly Base Salary in effect as of the Date of Termination [in addition to the
thirty (30) day notice of termination set forth in Section 4.1]. Separation Pay will be made
to the Executive in weekly payments beginning at least sixteen (16) days after Executive’s
execution of the Release Agreement, provided that Executive has not exercised rights to
revoke or rescind the release of claims as provided in the Release Agreement.

     (b) If Executive (or any individual receiving group health Plan benefits through
Executive) is eligible under applicable law to continue participation in Employer’s group
health Plan following the Date of Termination and elects to continue these benefits,
Employer will, for a period of up to seventeen (17) months commencing as of the Date of
Termination, continue to pay Employer’s share of the cost of these benefits as if Executive
remained continuously employed with Employer throughout such period but only while Executive
or such other individual continues to pay the balance of such cost and the Executive or the
person who elected continuation coverage is not eligible for coverage under any other
employer’s group health plan. In the alternative, Employer may elect, in its discretion, to
pay to Executive on or about the Date of Termination a lump sum calculated to represent
Employer’s share of the cost of these benefits.

     (c) Employer will pay, for a period of at least six (6) months commencing as of the
Date of Termination, by direct payment to providers or by reimbursement to Executive, all

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reasonable expenses of a reputable outplacement organization selected by Executive, but
not to exceed Twelve Thousand Dollars [$12,000.00] in the aggregate.

     (d) Employer will pay to Executive any unpaid management incentive bonus which
Executive earned, and to which Executive therefore is entitled, as of the last day of the
fiscal year prior to the Date of Termination and payment shall be made in accordance with
the terms of the Plan.

     5.4 No Additional Pay/Benefits. Except as specifically set forth above and except as
provided in Article 7, no post-termination payments or benefits will be provided to Executive
following the Date of Termination of Executive’s employment, except as otherwise provided under any
Plan in which Executive is a participant. No 401(k) contributions or contributions to any other
Plan will be paid by Employer based on post-termination Separation Pay. Further, Executive will
not be entitled to an incentive award under the Employer’s incentive Plans or any other bonus for
any fiscal year, or part thereof, during which post-termination Separation Pay is paid.

     5.5 No Mitigation. Executive will not be required to mitigate Employer’s payment
obligations under this Article 5 by making any efforts to secure other employment, and Executive’s
commencement of employment with another employer will not reduce the obligations of Employer under
this Article 5.

ARTICLE 6

CHANGE IN CONTROL

     6.1 Definitions Relating to a Change in Control. The following terms will have the
meanings set forth below; unless the context clearly requires otherwise:

     (a) “1934 Act” will mean the Securities Exchange Act of 1934, as amended (or any
successor provision), and applicable regulations.

     (b) “Beneficial Ownership” by a person or group of persons will be determined in
accordance with Regulation 13D (or any similar successor regulation) promulgated by the
Securities and Exchange Commission pursuant to the 1934 Act. Beneficial Ownership of an
equity security may be established by any reasonable method, but will be presumed
conclusively as to any person who files a Schedule 13D report with the Securities and
Exchange Commission reporting the ownership.

     (c) “Change in Control” means the occurrence of any of the following events:

     (i) Any person or group of persons attains Beneficial Ownership of thirty per
cent (30%) or more of any equity security of Employer entitled to vote for the
election of directors;

     (ii) a majority of the members of the Board is replaced within a period of less
than two (2) years by directors not nominated and approved by the Board; or

     (iii) the stockholders of Employer approve a plan of liquidation of Employer, or
an agreement to merge or consolidate with or into, or to sell or otherwise dispose of

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all or substantially all of Employer’s assets to, another corporation, entity or
person in which less than 50% of the total voting power is owned, directly or
indirectly, by Employer; provided, however, that this provision 7.1(c)(iii) shall not
be deemed to apply, and no Change in Control shall be deemed to occur, in the event
of a conversion of Employer from being a publicly-traded company to a private company
through efforts led by or coordinated with a management group of Employer in which
Executive actively and voluntarily participates other than at the request or behest
of Employer’s Board of Directors.

     (d) “Continuing Directors” are (i) directors who were in office prior to the time any
events described in paragraphs (c)(i), (c)(ii) or (c)(iii) of this Section 7.1 have
occurred; or (ii) directors in office for a period of more than two (2) years; or (iii)
directors nominated and approved by a majority of the Continuing Directors.

     (e) “Change in Control Termination” will mean a Change in Control of Employer has
occurred and the Executive’s employment is terminated by Executive for Good Reason, or by
Employer for any reason other than for Cause or for no reason, prior to the one (1) year
anniversary of the Change in Control.

     (f) “Good Reason” will mean, with respect to a voluntary termination of employment by
Executive after a Change in Control, any of the following:

     (i) a substantial adverse involuntary change in Executive’s status or position
as an executive with Employer, including, without limitation, (A) any material
adverse change in Executive’s status or position as a result of a material diminution
in Executive’s duties, responsibilities or authority as they existed as of the day
before the Change in Control; (B) the assignment to Executive of any duties or
responsibilities that are significantly inconsistent with Executive’s existing
duties, responsibilities or authority as of the day before the Change in Control; or
(C) any removal of Executive from, or any failure to reappoint or reelect Executive
to, a position with duties, responsibilities or authority substantially similar to
those Executive had as of the day before the Change in Control (except in connection
with a termination of Executive’s employment for Cause in accordance with Article 5,
or as a result of Executive’s Disability or death); provided, however, a change
resulting in Executive’s reporting in to an operating or corporate division of a
successor organization shall not be deemed a Good Reason under this Agreement;

     (ii) a material reduction by Employer in Executive’s Base Salary as in effect on
the day before the Change in Control;

     (iii) the taking of any action by Employer that would materially and adversely
affect the physical conditions existing as of the day before the Change in Control
that result in Executive being unable to perform Executive’s employment duties for
Employer, or under which Executive regularly performs employment duties for Employer;

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     (iv) any requirement that Executive relocate (other than on a sporadic or
intermittent basis) to a location which is more than thirty-five (35) miles from
Employer’s corporate headquarters as of the day before the Change in Control as a
necessary condition for Executive to perform him employment duties for Employer;

     (v) any failure by Employer to obtain from any Successor an assumption of this
Agreement; or

     (vi) any purported termination by Employer or by any Successor to the Employer
either of this Agreement or of the employment of the Executive that is not expressly
authorized by this Agreement; or any breach of this Agreement by Employer at any time
after a Change in Control, other than an isolated, insubstantial and inadvertent
failure that does not occur in bad faith and is remedied by Employer within a
reasonable period after Employer’s receipt of notice of the failure from Executive.

     6.2 Benefits Upon a Change in Control Termination. If a Change in Control Termination
occurs with respect to Executive, Employer shall provide Executive advance written notice of the
Date of Termination as provided in Section 4.1, and Section 5.2 shall apply until the date of the
Change in Control Termination. Upon the Change in Control Termination, Executive will be entitled
to the benefits described below; provided, however, that to the extent Executive has already
received the same type of benefits under this Agreement or otherwise, Executive’s benefits under
this Section 6.2 will be offset by these other benefits to the extent necessary to prevent
duplication of benefits under this Agreement; and provided further, that Executive executes the
Release Agreement in substantially the form attached as Exhibit B to this Agreement and consistent
with this Section 6.2.

     (a) an amount equal to seventeen (17) months of Executive’s Base Salary in effect as of
the Date of Termination [in addition to a thirty (30) day notice of termination as set forth
in Section 4.1] as separation pay, which separation pay will be made to the Executive in
weekly payments equal to the amount of the Executive’s weekly base salary for a period of
seventeen months; the first payment will commence beginning at least sixteen (16) days after
Executive’s execution of the Release Agreement, provided that Executive has not exercised
rights to revoke or rescind the release of claims as provided in the Release Agreement; or,
if required for purposes of avoiding excise tax or other penalties under Section 409A of the
Internal Revenue Code, payment will commence one week following the sixth month anniversary
of the Executive’s Date of Termination and shall include a lump sum equal to the amount that
Executive would have received had payment commenced upon the Date of Termination;

     (b) If Executive (or any individual receiving group health plan benefits through
Executive) is eligible under applicable law to continue participation in Employer’s group
health plan following the Date of Termination elects to continue these benefits, Employer
will, for a period of up to seventeen (17) months commencing as of the Date of Termination,
continue to pay Employer’s share of the cost of these benefits as if Executive remained
continuously employed with Employer throughout such period but only while Executive or such
other individual continues to pay the balance of such cost and the Executive or the person
who elected continuation coverage is not eligible for coverage under any other employer’s
group health plan; or in the alternative, Employer may elect, in its discretion, to pay to
Executive on

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or about the Date of Termination a lump sum calculated to represent Employer’s share of
the cost of these benefits;

     (c) for a period of at least six (6) months commencing as of the Date of Termination,
by direct payment to providers or by reimbursement to Executive, all reasonable expenses of
a reputable outplacement organization selected by Executive, but not to exceed Twelve
Thousand Dollars [$12,000.00] in the aggregate;

     (d) a lump sum payment on the date the Release becomes irrevocable, that is necessary
to acquire for, and obtain full title issued in the name of, Executive the personal
automobile leased by Employer for Executive under its Executive Automobile Program;

     (e) financial planning and tax preparation expenses, not to exceed Two Thousand Five
Hundred Dollars ($2,500.00) per annum, or such greater amount as determined from time to
time by the Employer’s Board, from the Date of Termination payable for the seventeen (17)
months following the Date of Termination; and

     (f) in accordance with the terms of the applicable Plan, any management incentive bonus
which Executive earned, and to which Executive therefore is entitled, as of the last day of
the fiscal year prior to the Date of Termination.

     6.3 No Mitigation. Executive will not be required to mitigate Employer’s payment
obligations under this Article 7 by making any efforts to secure other employment, and Executive’s
commencement of employment with another employer will not reduce the obligations of Employer
pursuant to this Article 7.

     6.4 Acceleration of Incentives. Upon the occurrence of a Change in Control, and
without regard to the Executive’s employment status, the following shall occur, without regard to
any contrary determination by Employer’s Board of Directors or a majority of the Continuing
Directors upon occurrence of a Change in Control, with respect to any and all economic incentives,
including without limitation stock options and awards of restricted stock, (the “Incentives”)
granted under the Equity Incentive Plan that are owned by Executive as of the date of the Change in
Control:

     (a) The restrictions set forth in the Equity Incentive Plan on all shares of restricted
stock awards will lapse immediately as of the date of the Change in Control;

     (b) All outstanding options and stock appreciation rights will become exercisable
immediately as of the date of the Change in Control; and

     (c) All performance shares will be deemed to be met and payment made immediately as of
the date of the Change in Control.

     6.5 Limitation on Change in Control Payments.

     (a) Notwithstanding any provision contained in this Agreement to the contrary, if any
amount or benefit to be paid or provided under this Article 7, or any other plan or
agreement between Executive and Employer would be an “Excess Parachute Payment,” within the
meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”),

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or any successor provision thereto, but for the application of this sentence, then the
payments and benefits to be paid or provided under this Article 7 will be reduced to the
minimum extent necessary (but in no event to less than zero) so that no portion of any such
payment or benefit, as so reduced, constitutes an Excess Parachute Payment; provided,
however, that the foregoing reduction will be made only if and to the extent that such
reduction would result in an increase in the aggregate payment and benefits to be provided
to Executive, determined on an after-tax basis (taking into account the excise tax imposed
pursuant to Section 4999 of the Code, or any successor provision thereto, any tax imposed by
any comparable provision of state law, and any applicable federal, state and local income
taxes). Executive agrees to take such action as Employer reasonably requests to mitigate or
challenge the application of such tax, provided that Employer shall supply such counsel and
expert advice, including legal counsel and accounting advice, as may reasonably be required,
and shall be responsible for the payment of such experts’ fees.

     (b) If requested by Executive or Employer, the determination of whether any reduction
in such payments or benefits to be provided under this Article 7 or otherwise is required
pursuant to the preceding sentence will be made by an independent accounting firm that is a
“Big-4 Accounting Firm” (or other accounting firm mutually acceptable to Executive and
Employer) not then-engaged as Employer’s independent public auditor, at the expense of
Employer, and the determination such independent accounting firm will be final and binding
on all parties. In making its determination, the independent accountant will allocate a
reasonable portion of the Change in Control Separation Pay to the value of any personal
services rendered following the Change in Control and the value of any non-competition
agreement or similar agreements to the extent that such items reduce the amount of the
parachute payment. In the event that any payment or benefit intended to be provided under
this Article 7 or otherwise is required to be reduced pursuant to this Section 7.4,
Executive (in Executive’s sole discretion) will be entitled to designate the payments and/or
benefits to be so reduced in order to give effect to this Section. Employer will provide
Executive with all information reasonably requested by Executive to permit Executive to make
such designation. In the event that Executive fails to make such designation within ten
(10) business days of receiving such information, Employer may effect such reduction in any
manner it deems appropriate.

     6.6 No Additional Pay/Benefits. Except as specifically set forth in this Article 6,
no post-termination payments or benefits will be provided to Executive with respect to a Change in
Control Termination following the Date of Termination of Executive’s employment, except as
otherwise provided under any Plan in which Executive is a participant. No 401(k) contributions or
contributions to any other Plan will be paid by Employer based on post-termination Change in
Control Separation Pay. Further, except as otherwise specifically provided under Agreement,
Executive will not be entitled to an incentive award under the Employer’s incentive Plans or any
other bonus for any fiscal year, or part thereof, during which post-termination Change in Control
Separation Pay is paid.

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ARTICLE 7

PROTECTION OF EMPLOYER

     7.1 Confidential Information.

     (a) “Confidential Information” means information that is proprietary to Employer or
proprietary to others and entrusted to Employer; whether or not such information includes
trade secrets. Confidential Information includes, but is not limited to, information
relating to Employer’s business plans and to its business as conducted or anticipated to be
conducted, and to its past or current or anticipated products and services. Confidential
Information also includes, without limitation, information concerning Employer’s customer
lists or routes, pricing, purchasing, inventory, business methods, training manuals or other
materials developed for Employer’s employee training, employee compensation, research,
development, accounting, marketing and selling. All information that Employer has a
reasonable basis to consider as confidential will be Confidential Information, whether or
not marked as such, whether or not originated by Executive and without regard to the manner
in which Executive obtains access to this and any other proprietary information of Employer.

     (b) Executive will not, during or after any termination of Executive’s employment under
this Agreement, (i) directly or indirectly use Confidential Information for Executive’s own
benefit; or (ii) disclose any Confidential Information to, or otherwise permit access to
Confidential Information by, any person or entity not employed by Employer or not authorized
by Employer to receive such Confidential Information, without the properly authorized prior
written consent of Employer. Executive will use reasonable and prudent care to safeguard
and protect and prevent the unauthorized use and disclosure of Confidential Information.
Furthermore, except in the usual course of Executive’s duties for Employer, Executive will
not at any time remove any Confidential Information from the offices of Employer, record or
copy any Confidential Information, use for Executive’s own benefit, or disclose to any
person or entity directly or indirectly competing with Employer, any information, data or
materials obtained from the files or customers of Employer, whether or not such information,
data or materials are Confidential Information.

     (c) Upon any termination of Executive’s employment, Executive will collect and return
to Employer (or its authorized representative) all original copies and all other copies of
any Confidential Information acquired by Executive while employed by Employer.

     (d) The obligations contained in this Section 7.1 will survive for as long as Employer
in its sole judgment considers the information to be Confidential Information. The
obligations under this Section 7.1 will not apply to any Confidential Information that is
now or becomes generally available to the public through no fault of Executive or to
Executive’s disclosure of any Confidential Information required by law or judicial or
administrative process.

     7.2 Non-Competition, Non-Solicitation. While employed by Employer and for a period of
eighteen (18) months following any Date of Termination under this Agreement, Executive will not,
directly or indirectly, alone or as an officer, director, shareholder, partner, member, employee,

13

 

independent contractor, or consultant of any other corporation or any partnership, limited
liability company, firm or other business entity:

     (a) engage in, have any ownership interest in, financial participation in, or become
employed by, any business or commercial activity in competition (i) with any part of
Employer’s business, as conducted anywhere within the geographic area in which Employer is
then conducting its business; Executive acknowledges that Employer presently conducts its
business generally throughout the United States or Canada; or (ii) with any part of
Employer’s contemplated business with respect to which Executive has had access to
Confidential Information governed by Section 7.1 [for purposes of this paragraph, “ownership
interest” will not include beneficial ownership of less than one percent (1%) of the
combined voting power of all issued and outstanding voting securities of a publicly held
corporation whose stock is traded on a major stock exchange or quoted on NASDAQ];

     (b) for the purpose of taking business away from Employer, call upon, solicit or
attempt to take away any customers, accounts or prospective customers of Employer;

     (c) solicit, induce or encourage any supplier of goods or services to Employer to cease
its business relationship with Employer, or violate any term of any contract with Employer;
or

     (d) solicit, induce or encourage any employee of Employer to violate any term of his or
her employment contract with Employer, or to directly or indirectly hire or solicit, induce,
recruit or encourage any of Employer’s employees for the purpose of hiring them or inducing
them to leave their employment with Employer.

     The restrictions set forth in this Section 7.2 will survive any termination of this
Agreement or other termination of Executive’s employment with Employer, for whatever reason,
and will remain effective and enforceable for the full eighteen (18) month period; provided,
however, that such period will be automatically extended and will remain in full force for
an additional period equal to any period in which Executive is proven to have violated any
such restriction.

     7.3 Stipulated Reasonableness. Executive acknowledges and agrees that the nature of
Executive’s position, the period of time necessary to fill Executive’s position in the event
Executive’s employment is terminated, the period of time necessary to allow customers of Employer’s
business to become familiar with Executive’s replacement, and the period of time necessary to cause
an end to the identification between Executive and Employer in the minds of Employer’s customers
and vendors, requires that the eighteen (18) month noncompetition and nonsolicitation period be
imposed for the protection of Employer’s investment in its business, and that the period is
reasonable and justified.

     7.4 Protection of Reputation. Executive will, both during and after any termination of
Executive’s employment under this Agreement, refrain from communicating to any person, including
without limitation any employee of Employer, any statements or opinions that are negative in any
way about Employer or any of its past, present or future officials. In return, whenever Employer
sends or receives any Notice of Termination of Executive’s employment under this Agreement,
Employer will

14

 

advise the members of its operating committee and executive committee (or any successors to
such committees), to refrain from negative communications about Executive to third parties.

     7.5 Remedies. The parties declare and agree that it is impossible to accurately
measure in money the damages that will accrue to Employer by reason of Executive’s failure to
perform any of Executive’s obligations under this Article 7, and that any such breach will result
in irreparable harm to Employer, for which any remedy at law would be inadequate. Therefore, if
Employer institutes any action or proceeding to enforce the provisions of this Article 7, Executive
waives the claim or defense that Employer has an adequate remedy at law and Executive will not
assert in any such action or proceeding the claim or defense that Employer has an adequate remedy
at law. Employer will be entitled, in addition to all other remedies or damages at law or in
equity, to temporary and permanent injunctions and orders to restrain any violations of this
Article 7 by Executive and all persons or entities acting for or with Executive.

     7.6 Survival. The provisions of Article 7 of this Agreement will survive the
termination of this Agreement or the termination of Executive’s employment with Employer, and will
remain in full force and affect following termination.

     7.7 Continuation. Executive and Employer acknowledge that certain terms and
conditions of this Article 7 restate and reassert terms and conditions previously agreed to between
them as a condition for Executive’s initial and continuing employment with Employer. To the extent
that any portion of this Article 7 may be deemed invalid for a failure of Employer to provide new
consideration to Executive, then that portion of this Article 7 will be deemed to have been
supported by those agreements between Executive and Employer heretofore entered into as a condition
for him initial and continuing employment with Employer.

     7.8 Forfeiture of Benefits for Violations of Article 7. Executive acknowledges and
agrees that him violation of any provisions of Sections 7.1(b), 7.1(c), 7.2, 7.4, or 7.7 above
shall result in the immediate forfeiture of any unpaid benefit under this Agreement. In addition,
Executive acknowledges that if he violates Sections 7.1(b), 7.1(c), 7.2, 7.4 or 7.7, he shall repay
to the Company any amounts paid following the Date of Termination under this Agreement.

     7.9 Severability and Blue Penciling. To the extent any provision of this Article 7
shall be determined to be invalid or unenforceable as written in any jurisdiction, the validity and
enforceability of the remainder of such provision and of this Agreement shall be unaffected. In
furtherance of and not in limitation of the foregoing, Executive expressly agrees that should the
duration of, geographical extent of, or business activities covered by, any provision of this
Article 7 be in excess of that which is valid or enforceable under applicable law in a given
jurisdiction, then such provision, as to such jurisdiction only, shall be construed to cover only
that duration, extent or activities that may validly or enforceably be covered. Executive
acknowledges the uncertainty of the law in this respect and expressly stipulates that this Article
7 shall be construed in a manner that renders its provisions valid and enforceable to the maximum
extent (not exceeding its express terms) possible under applicable law in each applicable
jurisdiction.

     7.10 Assignment of Invention. Executive hereby assigns to Employer all rights,
including copyrights and mask work rights, in and to all technical and intellectual property and
works produced by Executive, at Employer’s expense or based on Employer’s confidential information,
in carrying out

15

 

responsibilities of Executive’s position with Employer, including, but not limited to,
documents, drawings, manuscripts, text, artwork, photographs, motion pictures, video recordings,
computer software, sound recordings and similar property and works.

ARTICLE 8

GENERAL PROVISIONS

     8.1 Successors and Assigns; Beneficiary.

     (a) This Agreement will be binding upon and inure to the benefit of any Successor of
Employer, and any Successor will absolutely and unconditionally assume all of Employer’s
obligations hereunder this Agreement. Employer will use its best efforts to seek to have
any Successor, by agreement in form and substance satisfactory to Executive, assent to the
fulfillment by Employer of its obligations under this Agreement. Failure to obtain such
assent prior to the time a person or entity becomes a Successor (or where Employer does not
have advance notice that a person or, entity may become a Successor, within one (1) business
day after having notice that such person or entity may become or has become a Successor)
will constitute Good Reason for termination of employment by Executive with respect to
Executive.

     (b) This Agreement and all rights of Executive under this Agreement will inure to the
benefit of and be enforceable by Executive’s personal or legal representatives, executors,
administrators, successors, heirs, distributes, devisees and legatees and any assignees
permitted under this Agreement. If Executive dies while any amounts would still be payable
to Executive under this Agreement if Executive had continued to live, all such amounts,
unless otherwise provided herein, will be paid in accordance with the terms of this
Agreement to Executive’s Beneficiary. Executive may not assign this Agreement, in whole or
in any part, without the prior written consent of Employer.

     (c) For purposes of this Section 8.1, “Beneficiary” means the person or persons
designated by Executive (in writing to Employer) to receive benefits payable after
Executive’s death pursuant to Section 7.1(c). In the absence of any such designation or in
the event that all of the persons so designated predecease Executive, Beneficiary means the
executor, administrator or personal representative of Executive’s estate.

     8.2 Litigation Expense. If any party is made or will become a party to any litigation
(including arbitration) commenced by or against the other party involving the enforcement of any of
the rights or remedies of such party under this Agreement, or arising on account of a default of
the other party in its performance of any of the other party’s obligations under this Agreement,
then the parties will bear their own expenses and attorneys fees.

     8.3 Notices. All notices, requests and demands given to or made pursuant hereto will,
except as otherwise specified herein, be in writing and be personally delivered or mailed postage
prepaid, registered or certified U. S. mail, to any party as its address set forth on the last page
of this Agreement. Either party may, by notice hereunder this Agreement, designate a changed
address. Any notice hereunder this Agreement will be deemed effectively given and received: (a) if
personally

16

 

delivered, upon delivery; or (b) if mailed, on the registered date or the date stamped on the
certified mail receipt.

     8.4 Captions. The various headings or captions in this Agreement are for convenience
only and will not affect the meaning or interpretation of this Agreement. When used herein, the
terms “Article” and “Section” mean an Article or Section of this Agreement, except as otherwise
stated.

     8.5 Governing Law. The validity, interpretation, construction, performance,
enforcement and remedies of or relating to this Agreement, and the rights and obligations of the
parties under this Agreement, will be governed by the substantive laws of the State of Minnesota
(without regard to the conflict of laws rules or statutes of any jurisdiction), and any and every
legal proceeding arising out of or in connection with this Agreement will be brought in the
appropriate courts of the State of Minnesota, each of the parties hereby consenting to the
exclusive jurisdiction of said courts for this purpose.

     8.6 Construction. Wherever possible, each provision of this Agreement will be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Agreement will be prohibited by or invalid under applicable law, such provision is
ineffective only to the extent of such prohibition or invalidity without invalidating the remainder
of such provision or the remaining provisions of this Agreement. To the extent that any provision
of this Agreement shall be determined to be invalid or unenforceable, the validity and
enforceability of the remainder of such provision and of this Agreement shall be unaffected.

     8.7 Waiver. No failure on the part of either party to exercise, and no delay in
exercising, any right or remedy hereunder this Agreement will operate as a waiver thereof, nor will
any single or partial exercise of any right or remedy under this Agreement preclude any other or
further exercise thereof or the exercise of any other right or remedy granted hereby or by any
related document or by law.

     8.8 Modification. This Agreement may not be modified or amended except by written
instrument signed by the parties hereto; provided, however, that t            his Agreement shall be
amended or modified by the parties when and as necessary to assure compliance with laws and
regulations related to executive compensation. It further is a matter of corporate governance that
executive employment agreements, including this Agreement, should be reviewed periodically, and no
less than once every three years while in effect, for the purpose of evaluating consistency with
company goals and objectives and alignment with interests of shareholders.

     8.9 Entire Agreement. Except as otherwise specifically provided herein, this
Agreement constitutes the entire agreement and understanding between the parties in reference to
all the matters agreed upon herein, and replaces in full all prior employment agreements,
understandings or undertakings of the parties related to the employment relationship, and any and
all such prior agreements or under this understandings are hereby rescinded and voided by mutual
agreement including, without limitation, that Executive Employment Agreement effective as of
December 19, 2005.

     8.10 Survival. The provisions of this Agreement which by their express or implied
terms extend (a) beyond the termination of Executive’s employment hereunder (including, without
limitation, the provisions relating to separation compensation and effects of a Change in Control);
or (b) beyond

17

 

the termination of this Agreement (including, without limitation the provisions in Article 7
relating to confidential information, non-competition and non-solicitation), will continue in full
force and effect notwithstanding Executive’s termination of employment under this Agreement or the
termination of this Agreement, respectively.

     8.11 Section 409A. The Company shall, with the consent of Executive, timely amend
this Agreement as many times as may be required so that adverse tax consequences to the Executive
under Section 409A, including the imposition of any excise tax and interest penalties are avoided.
For purposes of this Section 8.1l, it is the intent of the Parties that the Agreement is amended
only to the extent required to comply with 409A and that the intended benefits to Executive,
including the amount, form and timing of such benefits as specified in this Agreement, will be
preserved to the greatest extent possible.

     8.12 Voluntary Agreement. Executive has entered into this Agreement voluntarily,
after having the opportunity to consult with an advisor chosen freely by Executive.

     8.13 Remedies. No civil action may be commenced for any claim or dispute relating to
this Agreement or arising out of Executive’s employment with Employer unless the parties, within
thirty (30) days after the date of either party’s written request, attempt in good faith to
promptly resolve the claim or dispute by negotiation at agreed time(s) and location(s). All
negotiations are confidential and will be treated as settlement negotiations. Notwithstanding the
foregoing, either party may seek equitable relief prior to such good faith efforts to preserve the
status quo pending the completion of such efforts.

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

18

 

     IN WITNESS WHEREOF, the parties have caused this Executive Employment Agreement to be executed
and delivered as of the Effective Date.

EMPLOYER:

	 	 	 	 	 
	 	G&K SERVICES, INC.

 	 
	 	By  /s/ Richard L. Marcantonio
 	 
	 	Richard L. Marcantonio 	 
	Employer's Address: 	Chairman and Chief Executive Officer

5995 Opus Parkway

Suite 500

Minnetonka, MN 55343 	 
	 

	 	 	 	 	 
	 	 	 
	EXECUTIVE: 	/s/ David M. Miller
 	 
	 	David M. Miller 	 
	 	 	 
	 

19

 

Exhibit List

Exhibit A — Release Agreement

Exhibit B — Release Agreementexv10w4

 

EXHIBIT 10.4

EXECUTIVE EMPLOYMENT AGREEMENT

     THIS AGREEMENT is made and entered into as of the 1st day of March 2007 (the
“Effective Date”) by and between G&K SERVICES, INC., a Minnesota corporation with its principal
business office in the State of Minnesota (“Employer”, as further defined in Section 1.10 below);
and Robert G. Wood, a resident of Canada reporting to Employer’s Corporate Office located in the
State of Minnesota, U.S.A. (“Executive”).

INTRODUCTION

     A. Employment. Employer has employed Executive as an executive under that Executive
Employment Agreement effective as of March 5, 2001, and now wishes to make available to Executive
certain new benefits and rights under this Executive Employment Agreement (the “Agreement”). This
Agreement is intended to fully supersede all previous agreements between them, including without
limitation that Executive Employment Agreement effective as of March 5, 2001, as well as that
Change in Control Agreement dated as of February 24, 1999, except as otherwise specifically set
forth herein. As such, Executive is subject to the same polices, terms and conditions as those
described in the Employer’s employee handbook, its Code of Ethics, policies, and employee benefit
plans (as modified from time to time by Employer), except as otherwise specifically provided in
this Agreement.

     B. Protection of Employer. Employer further wishes to obtain Executive’s promises
related to Notice of Termination as set forth in this Agreement, as well as Executive’s promises
not to harm Employer following execution of this Agreement, particularly with respect to Employer’s
Confidential Information, as more fully described in Article 8. In Executive’s position with
Employer, Executive is a valued employee of Employer and Employer will benefit from Executive’s
continued employment as an executive, and further Executive will have access to and control over
Employer’s Confidential Information, which Employer has developed at great expense, time and
effort. As a result, voluntary termination by Executive without adequate notice, or Executive’s
disclosure of any Confidential Information, could cause irreparable harm to Employer, and Employer
is not willing to extend to Executive the additional benefits, rights and responsibilities under
this Agreement unless Executive agrees, as set forth in this Agreement, to provide Employer with
reasonable notice of voluntary termination of his employment, reasonable protection for its
Confidential Information, and assurances to protect Employer in other ways set forth in Article 8.

     C. Employment and Benefits. For these purposes, Employer is willing to continue
retaining Executive as an executive and to grant to Executive benefits to which Executive is not
otherwise entitled, consisting of the right to receive certain separation pay, continued health and
dental care coverage, perquisites, and outplacement benefits [as described in Articles 6 and 7], if
Executive’s employment with Employer terminates under certain circumstances, including without
limitation in connection with a Change in Control [as defined at Section 7.1(c)].

     D. Other Intentions. Executive wishes to accept Employer’s offer to be retained as an
executive and of additional benefits set forth in this Agreement, to which Executive is not
otherwise entitled.

     Executive agrees, as a condition of Employer’s offer of additional benefits set forth in this
Agreement, to sign this Agreement in order that Employer may have reasonable protections against
the

 

 

disclosure of its Confidential Information, assurance of Executive’s adherence to his other
agreements under Article 8 of this Agreement, and certain protections related to Notice of
Termination as set forth in this Agreement.

AGREEMENT

     In consideration of the facts recited above, which are a part of this Agreement, and the
parties’ mutual undertakings in this Agreement, Employer and Executive agree to the following:

ARTICLE 1

DEFINITIONS

     Capitalized terms used generally in this Agreement will be consistently defined throughout the
Agreement. The following terms will have the meanings set forth below, unless the context clearly
requires otherwise.

     1.1 “Agreement” means this Agreement, as it may be amended from time to time.

     1.2 “Base Salary” means the total annual cash compensation payable to Executive on a regular
periodic basis under this Agreement, other than under Employer’s annual management incentive Plan,
without regard to any voluntary salary deferrals or reductions to fund employee benefits.

     1.3 “Board” means the Board of Directors of Employer.

     1.4 “Cause” has the meaning set forth in Section 5.3.

     1.5 “Change in Control” has the meaning set forth in Section 7.1(c).

     1.6 “Confidential Information” has the meaning set forth in Section 8.1.

     1.7 “Date of Termination” has the meaning set forth in Section 5.2(a).

     1.8 “Disability” means the unwillingness or inability of Executive to perform the essential
functions of Executive’s position (with or without reasonable accommodation) under this Agreement
for a period of ninety (90) days (consecutive or otherwise) within any period of six (6)
consecutive months because of Executive’s incapacity due to physical or mental illness, bodily
injury or disease, if Executive has not returned to the full-time performance of the Executive’s
duties within thirty (30) days after a Notice of Termination is issued by Employer, the Executive
will on such thirtieth day incur his Date of Termination; provided, however, that if Executive (or
Executive’s legal representative) does not agree with a determination of the existence of a
Disability (or the existence of a physical or mental illness or bodily injury or disease), this
determination will be subject to the certification of a qualified medical doctor mutually agreed to
by Employer and Executive. In the absence of agreement, each party will nominate a qualified
medical doctor and the two doctors will select a third doctor, who will make the determination as
to Disability. The decision of the designated physician will be binding upon the parties.

     1.9 “Effective Date” has the meaning referred to in the first paragraph of this Agreement.

2

 

     1.10 “Employer” means all of the following, jointly and severally: (a) G&K Services, Inc., (b)
any Subsidiary of G&K Services, Inc. and (c) any Successor of G&K Services, Inc.

     1.11 “Executive” means the individual named in the first paragraph of this Agreement.

     1.12 “Good Reason,” with respect to Executive’s termination of employment after a Change in
Control, has the meaning set forth in Section 7.1(f)

     1.13 “Notice of Termination” has the meaning set forth in Section 5.2(b).

     1.14 “Plan” means any bonus or incentive compensation agreement, plan, program, policy or
arrangement sponsored, maintained or contributed to by Employer in which executive employees of
Employer generally are covered, including, without limitation, (a) any stock option or any other
equity-based compensation plan, and specifically the G&K Services, Inc. 2006 Equity Incentive Plan,
and any predecessor or successor Plan thereto [hereinafter the “Equity Incentive Plan"] (b) any
annual or long-term incentive bonus plan; (c) any employee benefit plan, such as a thrift, profit
sharing, deferred compensation, medical, dental, disability income, accident, life insurance,
automobile allowance, perquisite, fringe benefit, vacation, sick or parental leave, separation or
relocation plan or policy and (d) any other agreement, plan, program, policy or arrangement
intended to benefit executive employees of Employer.

     1.15 “Subsidiary” means any corporation or other business entity controlled by Employer.

     1.16 “Successor” means any corporation, individual, group, association, partnership, limited
liability company, firm, venture or other entity or person that, subsequent to the Effective Date,
succeeds to the actual or practical ability to control (either immediately or with the passage of
time) substantially all of Employer and/or Employer’s business and/or assets, directly or
indirectly, by merger, consolidation, recapitalization, purchase, liquidation, redemption,
assignment, similar corporate transaction, operation of law or otherwise.

ARTICLE 2

EMPLOYMENT AND DUTIES

     2.1 Employment. Upon the terms and conditions set forth in this Agreement, Employer
hereby employs and Executive accepts employment for an indefinite term. Executive will serve in the
capacity of President, G&K Services Canada, or such other comparable senior leadership positions as
determined by Employer. This Agreement and Executive’s employment by Employer may be terminated at
any time and for any reason, with or without cause

     2.2 Duties. While Executive is employed under this Agreement, and excluding any
periods of vacation, sick, disability, or other leave to which Executive is entitled or is
authorized to take, Executive agrees to devote substantially all of Executive’s attention and time
during normal business hours to the business and affairs of Employer and to use Executive’s
reasonable best efforts to perform faithfully and efficiently such responsibilities assigned to
Executive from time to time. Executive will comply with each of Employer’s policies and
procedures, including those described in Employer’s employee handbook, Code of Ethics, policies,
and employee benefit plans, as modified from time to time by Employer; provided, however, that to
the extent these policies and procedures are inconsistent with this Agreement, the provisions of
this Agreement will control.

3

 

     2.3 Relationship of Parties. The relationship between Employer and Executive will be
that of employer and employee. Except as otherwise specifically provided in this Agreement,
nothing in this Agreement will be construed to give Executive any interest in the assets of
Employer. All of the records and files pertaining to Employer’s suppliers, licensors, licensees
and customers, and any Confidential Information, are specifically acknowledged to be the property
of Employer and not that of Executive.

ARTICLE 3

COMPENSATION AND BENEFITS

     3.1 Base Salary. Employer shall pay Executive a Base Salary at an annual rate as
approved from time to time by the Board or the Compensation Committee of the Board, such Base
Salary to be paid in substantially equal regular periodic payments in accordance with Employer’s
regular payroll practices. If Executive’s Base Salary is changed at any time during Executive’s
employment by Employer, the changed amount shall become the Base Salary under this Agreement,
subject to any subsequent changes.

     3.2 Other Compensation and Benefits. While Executive is employed by Employer under
this Agreement:

     (a) Executive will be permitted to participate in all Plans for which Executive is or
becomes eligible under their respective terms.

     (b) Executive will be entitled to a target incentive opportunity under the annual
management incentive Plan in effect at Employer from time to time, including Executive’s
target incentive for fiscal year 2007 established by the Board of Directors.

     (c) Executive will also be entitled to participate in or receive benefits under any
Plan made available by Employer in the future to its executives, subject to and on a basis
consistent with the terms, conditions and overall administration of the Plans and the
provisions of this Section 3.2.

     (d) Executive will be entitled to any other fringe benefit or perquisite that the
Compensation Committee of the Board approves with respect to Executive.

     (e) Employer may, in its sole discretion, amend or terminate any Plan that provides
benefits generally to its employees, key management employees, or executive team members.

     3.3 Limitation on Right to Deferred Compensation. The rights of Executive, or
Executive’s beneficiaries or estate, to any deferred compensation under this Agreement will be
solely those of an unsecured creditor of Employer. Nothing in this Agreement confers any right on
Executive, any of Executive’s beneficiaries, or Executive’s estate to receive, assign rights under,
or transfer any compensation including any deferred compensation other than as provided for under
the applicable Plan.

4

 

ARTICLE 4

RESTRICTED STOCK GRANT

     4.1 Restricted Stock Agreement. Employer and Executive previously entered into a
Restricted Stock Agreement dated as of January 2, 2001, an unexecuted copy of which is attached to
this Agreement as Exhibit C. This Agreement continues in full force and effect, and is
incorporated into this Agreement, granting Executive the right to purchase Employer Stock (as
defined below) in the amount, at the price and on the terms set forth in the Restricted Stock
Agreement.

     4.2 Employer Stock. “Employer Stock” means the voting common stock of Employer
described in the Restricted Stock Agreement attached as Exhibit C.

ARTICLE 5

TERMINATION

     Executive’s employment with the Employer may be terminated at any time as of the applicable
Date of Termination as follows; provided, however, that provisions contained in this Agreement
which by their terms are to remain enforceable after a Date of Termination shall remain enforceable
to the full extent necessary to give them effect:

     5.1 Termination. Except as specifically provided otherwise in this Agreement, this
Agreement and Executive’s employment with the Employer may be terminated by Employer or by
Executive upon thirty (30) days advance written notice, for any reason or no reason, or at any time
by mutual written agreement of the parties. During the period after notice is given, at Employer’s
request and sole discretion, Executive will continue to render Executive’s normal service to
Employer to the best of Executive’s ability, and Employer will continue to compensate the Executive
through the Date of Termination as set forth in Section 6.2. In addition, this Agreement and
Executive’s employment under this Agreement will terminate in the event of Executive’s death or
Disability, as of the applicable Date of Termination.

     5.2 Date of Termination and Notice of Termination.

     (a) For purposes of this Agreement, “Date of Termination” will mean: (i) if Executive’s
employment is terminated due to death, the date of Executive’s death; (ii) if Executive’s
employment is terminated for Disability, thirty (30) calendar days after the Notice of
Termination is provided; (iii) if Executive’s employment is terminated by Employer for
Cause, the date stated in the Notice of Termination; (iv) if Executive’s employment is
terminated by mutual agreement of the parties, the termination date provided for under the
agreement; (v) if Executive’s employment is terminated for any other reason, and subject to
the terms of Section 5.1 above, the date stated in the Notice of Termination, unless an
earlier date has been expressly agreed to by Executive in writing either before or after
receiving the Notice of Termination.

     (b) For purposes of this Agreement, a “Notice of Termination” will mean a notice that
indicates the date on which termination of Executive’s employment is effective. Any
termination by Employer or by Executive under to this Agreement [other than Executive’s
death, or a termination by mutual agreement] will be communicated to the other party by
submission of a written Notice of Termination. If termination is by Employer for Cause or
by

5

 

Executive for Good Reason, the Notice of Termination will set forth in reasonable
detail the facts and circumstances claimed to provide the basis for the termination,
consistent with the terms of this Agreement.

     5.3 Termination by Employer for Cause. Employer may terminate Executive’s at will
employment at any time for Cause, with or without advance notice [except as otherwise provided in
this Section 5.3]. For purposes of this Agreement, “Cause” means any of the following, with respect
to Executive’s position of employment with Employer:

     (a) Executive’s failure or refusal to perform the duties and responsibilities as set
forth in Section 2.2, if the failure or refusal (i) is not due to a Disability or a physical
or mental illness or bodily injury or disease; or (ii) is not due to Executive’s reasonable
best efforts to perform faithfully and efficiently the responsibilities of his position with
Employer, acting in good faith in the interests of Employer, its shareholders and employees;

     (b) any drunkenness or use of drugs that interferes with the performance of Executive’s
obligations under this Agreement;

     (c) Executive’s indictment for or conviction of (including entering a guilty plea or
plea of no contest to) a felony or of any crime involving moral turpitude, fraud, dishonesty
or theft;

     (d) any material dishonesty of Executive involving or affecting Employer;

     (e) any gross negligence, or any willful or intentional act or omission of Executive
having the effect or reasonably likely to have the effect of injuring the reputation,
business or business relationships of Employer in a material way;

     (f) any willful or intentional breach by Executive of a fiduciary duty to Employer;

     (g) except as otherwise specifically provided in this Section 5.3, Executive’s material
violation or breach of Employer’s standard business practices and policies;

     (h) any court order or settlement agreement prohibits Executive’s continued employment
with Employer; or

     (i) any material breach by Executive [not covered by any of the above clauses (a)
through (h)] of any material term, provision or condition of this Agreement.

     Notwithstanding any of the foregoing, “Cause” shall not be deemed to exist unless and until
Employer provides Executive with (A) at least ten (10) days prior written notice of its intention
to terminate employment for Cause, together with a written statement describing the nature of the
Cause, including the clause or clauses of this definition that Employer deems applicable, and (B)
if the item constituting Employer’s “Cause” for termination of Executive is within the scope of
clauses (a), (b) (g) or (i) above, thirty (30) days to cure any acts or omissions on which the
finding of Cause is based. If the Executive cures, in accordance with the terms of the written
notice, the acts or omissions on which the finding of Cause is based, Employer shall not have Cause
to terminate the Executive’s employment under this Agreement.

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     For purposes of this Section 5.3, no act, or failure to act, on Executive’s part will be
considered “dishonest,” “willful” or “intentional” unless done, or omitted to be done, by Executive
in bad faith and without reasonable belief that Executive’s action or omission was in or
not opposed to, the best interest of Employer. Any act, or failure to act, based upon authority
given pursuant to a resolution duly adopted by the Board or based upon the advice of counsel for
Employer will be conclusively presumed to be done, or omitted to be done, by Executive in good
faith and in the best interests of Employer. Furthermore, the term “Cause” will not include
ordinary negligence or failure to act, whether due to an error in judgment or otherwise, if
Executive has exercised substantial efforts in good faith to perform the duties reasonably assigned
or appropriate to the position.

ARTICLE 6

PAYMENTS UPON TERMINATION

     6.1 Compensation during Disability. During any period in which Executive fails to
perform Executive’s duties under this Agreement as a result of Executive’s incapacity due to
physical or mental illness or bodily injury or disease, Executive will continue to receive all Base
Salary and other compensation and benefits to which Executive is otherwise entitled under this
Agreement and any Plan through Executive’s Date of Termination, but only to the extent that
Executive is not receiving substantially equivalent benefits under any Plan maintained by Employer.

     6.2 Compensation Until Date of Termination of Employment. If Executive’s employment
under this Agreement is terminated, then Employer will pay Executive the Base Salary through the
Date of Termination, plus any other amounts which Executive has earned, and to which Executive
therefore is entitled, prior to the Date of Termination under this Agreement and under any Plan as
provided under the Plan; provided that Executive continues to perform duties in accordance with
Article 2.

     6.3 Compensation Following Termination of Employment by Employer Without Cause. In
the event Executive’s employment under this Agreement is terminated by Employer without Cause, and
provided Executive shall first execute a written release substantially in the form attached to this
Agreement as Exhibit A consistent with this Section 6.3 (the “Release Agreement”), and provided
further that Executive has not exercised rights to revoke or rescind the release of claims under to
the Release Agreement, then Employer shall provide to Executive the following benefits:

     (a) Employer will pay to Executive, as Separation Pay, which Executive has not earned
and to which Executive is not otherwise entitled, an amount equal to eleven (11) months of
Executive’s monthly Base Salary in effect as of the Date of Termination [in addition to the
thirty (30) day notice of termination set forth in Section 5.1]. Separation Pay will be made
to the Executive in weekly payments beginning at least sixteen (16) days after Executive’s
execution of the Release Agreement, provided that Executive has not exercised rights to
revoke or rescind the release of claims as provided in the Release Agreement.

     (b) If Executive (or any individual receiving group health Plan benefits through
Executive) is eligible under applicable law to continue participation in Employer’s group
health Plan following the Date of Termination and elects to continue these benefits,
Employer will, for a period of up to seventeen (17) months commencing as of the Date of
Termination, continue to pay Employer’s share of the cost of these benefits as if Executive
remained continuously

7

 

employed with Employer throughout such period but only while Executive or such other
individual continues to pay the balance of such cost and the Executive or the person who
elected continuation coverage is not eligible for coverage under any other employer’s group
health plan. In the alternative, Employer may elect, in its discretion, to pay to Executive
on or about the Date of Termination a lump sum calculated to represent Employer’s share of
the cost of these benefits.

     (c) Employer will pay, for a period of at least six (6) months commencing as of the
Date of Termination, by direct payment to providers or by reimbursement to Executive, all
reasonable expenses of a reputable outplacement organization selected by Executive, but not
to exceed Twelve Thousand Dollars [$12,000.00] in the aggregate.

     (d) Employer will pay to Executive any unpaid management incentive bonus which
Executive earned, and to which Executive therefore is entitled, as of the last day of the
fiscal year prior to the Date of Termination and payment shall be made in accordance with
the terms of the Plan.

     6.4 No Additional Pay/Benefits. Except as specifically set forth above and except as
provided in Article 7, no post-termination payments or benefits will be provided to Executive
following the Date of Termination of Executive’s employment, except as otherwise provided under any
Plan in which Executive is a participant. No 401(k) contributions or contributions to any other
Plan will be paid by Employer based on post-termination Separation Pay. Further, Executive will
not be entitled to an incentive award under the Employer’s incentive Plans or any other bonus for
any fiscal year, or part thereof, during which post-termination Separation Pay is paid.

     6.5 No Mitigation. Executive will not be required to mitigate Employer’s payment
obligations under this Article 6 by making any efforts to secure other employment, and Executive’s
commencement of employment with another employer will not reduce the obligations of Employer under
this Article 6.

ARTICLE 7

CHANGE IN CONTROL

     7.1 Definitions Relating to a Change in Control. The following terms will have the
meanings set forth below; unless the context clearly requires otherwise:

     (a) “1934 Act” will mean the Securities Exchange Act of 1934, as amended (or any
successor provision), and applicable regulations.

     (b) “Beneficial Ownership” by a person or group of persons will be determined in
accordance with Regulation 13D (or any similar successor regulation) promulgated by the
Securities and Exchange Commission pursuant to the 1934 Act. Beneficial Ownership of an
equity security may be established by any reasonable method, but will be presumed
conclusively as to any person who files a Schedule 13D report with the Securities and
Exchange Commission reporting the ownership.

     (c) “Change in Control” means the occurrence of any of the following events:

8

 

     (i) Any person or group of persons attains Beneficial Ownership of thirty per
cent (30%) or more of any equity security of Employer entitled to vote for the
election of directors;

     (ii) a majority of the members of the Board is replaced within a period of less
than two (2) years by directors not nominated and approved by the Board; or

     (iii) the stockholders of Employer approve a plan of liquidation of Employer, or
an agreement to merge or consolidate with or into, or to sell or otherwise dispose of
all or substantially all of Employer’s assets to, another corporation, entity or
person in which less than 50% of the total voting power is owned, directly or
indirectly, by Employer; provided, however, that this provision 7.1(c)(iii) shall not
be deemed to apply, and no Change in Control shall be deemed to occur, in the event
of a conversion of Employer from being a publicly-traded company to a private company
through efforts led by or coordinated with a management group of Employer in which
Executive actively and voluntarily participates other than at the request or behest
of Employer’s Board of Directors.

     (d) “Continuing Directors” are (i) directors who were in office prior to the time any
events described in paragraphs (c)(i), (c)(ii) or (c)(iii) of this Section 7.1 have
occurred; or (ii) directors in office for a period of more than two (2) years; or (iii)
directors nominated and approved by a majority of the Continuing Directors.

     (e) “Change in Control Termination” will mean a Change in Control of Employer has
occurred and the Executive’s employment is terminated by Executive for Good Reason, or by
Employer for any reason other than for Cause or for no reason, prior to the one (1) year
anniversary of the Change in Control.

     (f) “Good Reason” will mean, with respect to a voluntary termination of employment by
Executive after a Change in Control, any of the following:

     (i) a substantial adverse involuntary change in Executive’s status or position
as an executive with Employer, including, without limitation, (A) any material
adverse change in Executive’s status or position as a result of a material diminution
in Executive’s duties, responsibilities or authority as they existed as of the day
before the Change in Control; (B) the assignment to Executive of any duties or
responsibilities that are significantly inconsistent with Executive’s existing
duties, responsibilities or authority as of the day before the Change in Control; or
(C) any removal of Executive from, or any failure to reappoint or reelect Executive
to, a position with duties, responsibilities or authority substantially similar to
those Executive had as of the day before the Change in Control (except in connection
with a termination of Executive’s employment for Cause in accordance with Article 5,
or as a result of Executive’s Disability or death); provided, however, a change
resulting in Executive’s reporting in to an operating or corporate division of a
successor organization shall not be deemed a Good Reason under this Agreement;

9

 

     (ii) a material reduction by Employer in Executive’s Base Salary as in effect on
the day before the Change in Control;

     (iii) the taking of any action by Employer that would materially and adversely
affect the physical conditions existing as of the day before the Change in Control
that result in Executive being unable to perform Executive’s employment duties for
Employer, or under which Executive regularly performs employment duties for Employer;

     (iv) any requirement that Executive relocate (other than on a sporadic or
intermittent basis) to a location which is more than thirty-five (35) miles from
Employer’s corporate headquarters as of the day before the Change in Control as a
necessary condition for Executive to perform his employment duties for Employer;

     (v) any failure by Employer to obtain from any Successor an assumption of this
Agreement; or

     (vi) any purported termination by Employer or by any Successor to the Employer
either of this Agreement or of the employment of the Executive that is not expressly
authorized by this Agreement; or any breach of this Agreement by Employer at any time
after a Change in Control, other than an isolated, insubstantial and inadvertent
failure that does not occur in bad faith and is remedied by Employer within a
reasonable period after Employer’s receipt of notice of the failure from Executive.

     7.2 Benefits Upon a Change in Control Termination. If a Change in Control Termination
occurs with respect to Executive, Employer shall provide Executive advance written notice of the
Date of Termination as provided in Section 5.1, and Section 6.2 shall apply until the date of the
Change in Control Termination. Upon the Change in Control Termination, Executive will be entitled
to the benefits described below; provided, however, that to the extent Executive has already
received the same type of benefits under this Agreement or otherwise, Executive’s benefits under
this Section 7.2 will be offset by these other benefits to the extent necessary to prevent
duplication of benefits under this Agreement; and provided further, that Executive executes the
Release Agreement in substantially the form attached as Exhibit B to this Agreement and consistent
with this Section 7.2.

     (a) an amount equal to seventeen (17) months of Executive’s Base Salary in effect as of
the Date of Termination [in addition to a thirty (30) day notice of termination as set forth
in Section 5.1] as separation pay, which separation pay will be made to the Executive in
weekly payments equal to the amount of the Executive’s weekly base salary for a period of
seventeen months; the first payment will commence beginning at least sixteen (16) days after
Executive’s execution of the Release Agreement, provided that Executive has not exercised
rights to revoke or rescind the release of claims as provided in the Release Agreement; or,
if required for purposes of avoiding excise tax or other penalties under Section 409A of the
Internal Revenue Code, payment will commence one week following the sixth month anniversary
of the Executive’s Date of Termination and shall include a lump sum equal to the amount that
Executive would have received had payment commenced upon the Date of Termination;

10

 

     (b) If Executive (or any individual receiving group health plan benefits through
Executive) is eligible under applicable law to continue participation in Employer’s group
health plan following the Date of Termination elects to continue these benefits, Employer
will, for a period of up to seventeen (17) months commencing as of the Date of Termination,
continue to pay Employer’s share of the cost of these benefits as if Executive remained
continuously employed with Employer throughout such period but only while Executive or such
other individual continues to pay the balance of such cost and the Executive or the person
who elected continuation coverage is not eligible for coverage under any other employer’s
group health plan; or in the alternative, Employer may elect, in its discretion, to pay to
Executive on or about the Date of Termination a lump sum calculated to represent Employer’s
share of the cost of these benefits;

     (c) for a period of at least six (6) months commencing as of the Date of Termination,
by direct payment to providers or by reimbursement to Executive, all reasonable expenses of
a reputable outplacement organization selected by Executive, but not to exceed Twelve
Thousand Dollars [$12,000.00] in the aggregate;

     (d) a lump sum payment on the date the Release becomes irrevocable, that is necessary
to acquire for, and obtain full title issued in the name of, Executive the personal
automobile leased by Employer for Executive under its Executive Automobile Program;

     (e) financial planning and tax preparation expenses, not to exceed Two Thousand Five
Hundred Dollars ($2,500.00) per annum, or such greater amount as determined from time to
time by the Employer’s Board, from the Date of Termination payable for the seventeen (17)
months following the Date of Termination; and

     (f) in accordance with the terms of the applicable Plan, any management incentive bonus
which Executive earned, and to which Executive therefore is entitled, as of the last day of
the fiscal year prior to the Date of Termination.

     7.3 No Mitigation. Executive will not be required to mitigate Employer’s payment
obligations under this Article 7 by making any efforts to secure other employment, and Executive’s
commencement of employment with another employer will not reduce the obligations of Employer
pursuant to this Article 7.

     7.4 Acceleration of Incentives. Upon the occurrence of a Change in Control, and
without regard to the Executive’s employment status, the following shall occur, without regard to
any contrary determination by Employer’s Board of Directors or a majority of the Continuing
Directors upon occurrence of a Change in Control, with respect to any and all economic incentives,
including without limitation stock options and awards of restricted stock, (the “Incentives”)
granted under the Equity Incentive Plan that are owned by Executive as of the date of the Change in
Control:

     (a) The restrictions set forth in the Equity Incentive Plan on all shares of restricted
stock awards will lapse immediately as of the date of the Change in Control;

     (b) All outstanding options and stock appreciation rights will become exercisable
immediately as of the date of the Change in Control; and

11

 

     (c) All performance shares will be deemed to be met and payment made immediately as of
the date of the Change in Control.

     7.5 Limitation on Change in Control Payments.

     (a) Notwithstanding any provision contained in this Agreement to the contrary, if any
amount or benefit to be paid or provided under this Article 7, or any other plan or
agreement between Executive and Employer would be an “Excess Parachute Payment,” within the
meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), or
any successor provision thereto, but for the application of this sentence, then the payments
and benefits to be paid or provided under this Article 7 will be reduced to the minimum
extent necessary (but in no event to less than zero) so that no portion of any such payment
or benefit, as so reduced, constitutes an Excess Parachute Payment; provided, however, that
the foregoing reduction will be made only if and to the extent that such reduction would
result in an increase in the aggregate payment and benefits to be provided to Executive,
determined on an after-tax basis (taking into account the excise tax imposed pursuant to
Section 4999 of the Code, or any successor provision thereto, any tax imposed by any
comparable provision of state law, and any applicable federal, state and local income
taxes). Executive agrees to take such action as Employer reasonably requests to mitigate or
challenge the application of such tax, provided that Employer shall supply such counsel and
expert advice, including legal counsel and accounting advice, as may reasonably be required,
and shall be responsible for the payment of such experts’ fees.

     (b) If requested by Executive or Employer, the determination of whether any reduction
in such payments or benefits to be provided under this Article 7 or otherwise is required
pursuant to the preceding sentence will be made by an independent accounting firm that is a
“Big-4 Accounting Firm” (or other accounting firm mutually acceptable to Executive and
Employer) not then-engaged as Employer’s independent public auditor, at the expense of
Employer, and the determination such independent accounting firm will be final and binding
on all parties. In making its determination, the independent accountant will allocate a
reasonable portion of the Change in Control Separation Pay to the value of any personal
services rendered following the Change in Control and the value of any non-competition
agreement or similar agreements to the extent that such items reduce the amount of the
parachute payment. In the event that any payment or benefit intended to be provided under
this Article 7 or otherwise is required to be reduced pursuant to this Section 7.4,
Executive (in Executive’s sole discretion) will be entitled to designate the payments and/or
benefits to be so reduced in order to give effect to this Section. Employer will provide
Executive with all information reasonably requested by Executive to permit Executive to make
such designation. In the event that Executive fails to make such designation within ten
(10) business days of receiving such information, Employer may effect such reduction in any
manner it deems appropriate.

     7.6 No Additional Pay/Benefits. Except as specifically set forth in this Article 7,
no post-termination payments or benefits will be provided to Executive with respect to a Change in
Control Termination following the Date of Termination of Executive’s employment, except as
otherwise provided under any Plan in which Executive is a participant. No 401(k) contributions or
contributions to any other Plan will be paid by Employer based on post-termination Change in
Control Separation Pay. Further, except as otherwise specifically provided under Agreement,
Executive will not be

12

 

entitled to an incentive award under the Employer’s incentive Plans or any other bonus for any
fiscal year, or part thereof, during which post-termination Change in Control Separation Pay is
paid.

ARTICLE 8

PROTECTION OF EMPLOYER

     8.1 Confidential Information.

     (a) “Confidential Information” means information that is proprietary to Employer or
proprietary to others and entrusted to Employer; whether or not such information includes
trade secrets. Confidential Information includes, but is not limited to, information
relating to Employer’s business plans and to its business as conducted or anticipated to be
conducted, and to its past or current or anticipated products and services. Confidential
Information also includes, without limitation, information concerning Employer’s customer
lists or routes, pricing, purchasing, inventory, business methods, training manuals or other
materials developed for Employer’s employee training, employee compensation, research,
development, accounting, marketing and selling. All information that Employer has a
reasonable basis to consider as confidential will be Confidential Information, whether or
not marked as such, whether or not originated by Executive and without regard to the manner
in which Executive obtains access to this and any other proprietary information of Employer.

     (b) Executive will not, during or after any termination of Executive’s employment under
this Agreement, (i) directly or indirectly use Confidential Information for Executive’s own
benefit; or (ii) disclose any Confidential Information to, or otherwise permit access to
Confidential Information by, any person or entity not employed by Employer or not authorized
by Employer to receive such Confidential Information, without the properly authorized prior
written consent of Employer. Executive will use reasonable and prudent care to safeguard
and protect and prevent the unauthorized use and disclosure of Confidential Information.
Furthermore, except in the usual course of Executive’s duties for Employer, Executive will
not at any time remove any Confidential Information from the offices of Employer, record or
copy any Confidential Information, use for Executive’s own benefit, or disclose to any
person or entity directly or indirectly competing with Employer, any information, data or
materials obtained from the files or customers of Employer, whether or not such information,
data or materials are Confidential Information.

     (c) Upon any termination of Executive’s employment, Executive will collect and return
to Employer (or its authorized representative) all original copies and all other copies of
any Confidential Information acquired by Executive while employed by Employer.

     (d) The obligations contained in this Section 8.1 will survive for as long as Employer
in its sole judgment considers the information to be Confidential Information. The
obligations under this Section 8.1 will not apply to any Confidential Information that is
now or becomes generally available to the public through no fault of Executive or to
Executive’s disclosure of any Confidential Information required by law or judicial or
administrative process.

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     8.2 Non-Competition, Non-Solicitation. While employed by Employer and for a period of
eighteen (18) months following any Date of Termination under this Agreement, Executive will not,
directly or indirectly, alone or as an officer, director, shareholder, partner, member, employee,
independent contractor, or consultant of any other corporation or any partnership, limited
liability company, firm or other business entity:

     (a) engage in, have any ownership interest in, financial participation in, or become
employed by, any business or commercial activity in competition (i) with any part of
Employer’s business, as conducted anywhere within the geographic area in which Employer is
then conducting its business; Executive acknowledges that Employer presently conducts its
business generally throughout the United States or Canada; or (ii) with any part of
Employer’s contemplated business with respect to which Executive has had access to
Confidential Information governed by Section 8.1 [for purposes of this paragraph, “ownership
interest” will not include beneficial ownership of less than one percent (1%) of the
combined voting power of all issued and outstanding voting securities of a publicly held
corporation whose stock is traded on a major stock exchange or quoted on NASDAQ];

     (b) for the purpose of taking business away from Employer, call upon, solicit or
attempt to take away any customers, accounts or prospective customers of Employer;

     (c) solicit, induce or encourage any supplier of goods or services to Employer to cease
its business relationship with Employer, or violate any term of any contract with Employer;
or

     (d) solicit, induce or encourage any employee of Employer to violate any term of his or
her employment contract with Employer, or to directly or indirectly hire or solicit, induce,
recruit or encourage any of Employer’s employees for the purpose of hiring them or inducing
them to leave their employment with Employer.

     The restrictions set forth in this Section 8.2 will survive any termination of this
Agreement or other termination of Executive’s employment with Employer, for whatever reason,
and will remain effective and enforceable for the full eighteen (18) month period; provided,
however, that such period will be automatically extended and will remain in full force for
an additional period equal to any period in which Executive is proven to have violated any
such restriction.

     8.3 Stipulated Reasonableness. Executive acknowledges and agrees that the nature of
Executive’s position, the period of time necessary to fill Executive’s position in the event
Executive’s employment is terminated, the period of time necessary to allow customers of Employer’s
business to become familiar with Executive’s replacement, and the period of time necessary to cause
an end to the identification between Executive and Employer in the minds of Employer’s customers
and vendors, requires that the eighteen (18) month noncompetition and nonsolicitation period be
imposed for the protection of Employer’s investment in its business, and that the period is
reasonable and justified.

     8.4 Protection of Reputation. Executive will, both during and after any termination of
Executive’s employment under this Agreement, refrain from communicating to any person, including
without limitation any employee of Employer, any statements or opinions that are negative in any
way

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about Employer or any of its past, present or future officials. In return, whenever Employer
sends or receives any Notice of Termination of Executive’s employment under this Agreement,
Employer will advise the members of its operating committee and executive committee (or any
successors to such committees), to refrain from negative communications about Executive to third
parties.

     8.5 Remedies. The parties declare and agree that it is impossible to accurately
measure in money the damages that will accrue to Employer by reason of Executive’s failure to
perform any of Executive’s obligations under this Article 8, and that any such breach will result
in irreparable harm to Employer, for which any remedy at law would be inadequate. Therefore, if
Employer institutes any action or proceeding to enforce the provisions of this Article 8, Executive
waives the claim or defense that Employer has an adequate remedy at law and Executive will not
assert in any such action or proceeding the claim or defense that Employer has an adequate remedy
at law. Employer will be entitled, in addition to all other remedies or damages at law or in
equity, to temporary and permanent injunctions and orders to restrain any violations of this
Article 8 by Executive and all persons or entities acting for or with Executive.

     8.6 Survival. The provisions of Article 8 of this Agreement will survive the
termination of this Agreement or the termination of Executive’s employment with Employer, and will
remain in full force and affect following termination.

     8.7 Continuation. Executive and Employer acknowledge that certain terms and
conditions of this Article 8 restate and reassert terms and conditions previously agreed to between
them as a condition for Executive’s initial and continuing employment with Employer. To the extent
that any portion of this Article 8 may be deemed invalid for a failure of Employer to provide new
consideration to Executive, then that portion of this Article 8 will be deemed to have been
supported by those agreements between Executive and Employer heretofore entered into as a condition
for his initial and continuing employment with Employer.

     8.8 Forfeiture of Benefits for Violations of Article 8. Executive acknowledges and
agrees that his violation of any provisions of Sections 8.1(b), 8.1(c), 8.2, 8.4, or 8.7 above
shall result in the immediate forfeiture of any unpaid benefit under this Agreement. In addition,
Executive acknowledges that if he violates Sections 8.1(b), 8.1(c), 8.2, 8.4 or 8.7, he shall repay
to the Company any amounts paid following the Date of Termination under this Agreement.

     8.9 Severability and Blue Penciling. To the extent any provision of this Article 8
shall be determined to be invalid or unenforceable as written in any jurisdiction, the validity and
enforceability of the remainder of such provision and of this Agreement shall be unaffected. In
furtherance of and not in limitation of the foregoing, Executive expressly agrees that should the
duration of, geographical extent of, or business activities covered by, any provision of this
Article 8 be in excess of that which is valid or enforceable under applicable law in a given
jurisdiction, then such provision, as to such jurisdiction only, shall be construed to cover only
that duration, extent or activities that may validly or enforceably be covered. Executive
acknowledges the uncertainty of the law in this respect and expressly stipulates that this Article
8 shall be construed in a manner that renders its provisions valid and enforceable to the maximum
extent (not exceeding its express terms) possible under applicable law in each applicable
jurisdiction.

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     8.10 Assignment of Invention. Executive hereby assigns to Employer all rights,
including copyrights and mask work rights, in and to all technical and intellectual property and
works produced by Executive, at Employer’s expense or based on Employer’s confidential information,
in carrying out responsibilities of Executive’s position with Employer, including, but not limited
to, documents, drawings, manuscripts, text, artwork, photographs, motion pictures, video
recordings, computer software, sound recordings and similar property and works.

ARTICLE 9

GENERAL PROVISIONS

     9.1 Successors and Assigns; Beneficiary.

     (a) This Agreement will be binding upon and inure to the benefit of any Successor of
Employer, and any Successor will absolutely and unconditionally assume all of Employer’s
obligations hereunder this Agreement. Employer will use its best efforts to seek to have
any Successor, by agreement in form and substance satisfactory to Executive, assent to the
fulfillment by Employer of its obligations under this Agreement. Failure to obtain such
assent prior to the time a person or entity becomes a Successor (or where Employer does not
have advance notice that a person or, entity may become a Successor, within one (1) business
day after having notice that such person or entity may become or has become a Successor)
will constitute Good Reason for termination of employment by Executive with respect to
Executive.

     (b) This Agreement and all rights of Executive under this Agreement will inure to the
benefit of and be enforceable by Executive’s personal or legal representatives, executors,
administrators, successors, heirs, distributes, devisees and legatees and any assignees
permitted under this Agreement. If Executive dies while any amounts would still be payable
to Executive under this Agreement if Executive had continued to live, all such amounts,
unless otherwise provided herein, will be paid in accordance with the terms of this
Agreement to Executive’s Beneficiary. Executive may not assign this Agreement, in whole or
in any part, without the prior written consent of Employer.

     (c) For purposes of this Section 9.1, “Beneficiary” means the person or persons
designated by Executive (in writing to Employer) to receive benefits payable after
Executive’s death pursuant to Section 7.1(c). In the absence of any such designation or in
the event that all of the persons so designated predecease Executive, Beneficiary means the
executor, administrator or personal representative of Executive’s estate.

     9.2 Litigation Expense. If any party is made or will become a party to any litigation
(including arbitration) commenced by or against the other party involving the enforcement of any of
the rights or remedies of such party under this Agreement, or arising on account of a default of
the other party in its performance of any of the other party’s obligations under this Agreement,
then the parties will bear their own expenses and attorneys fees.

     9.3 Notices. All notices, requests and demands given to or made pursuant hereto will,
except as otherwise specified herein, be in writing and be personally delivered or mailed postage
prepaid, registered or certified U. S. mail, to any party as its address set forth on the last page
of this Agreement. Either party may, by notice hereunder this Agreement, designate a changed
address. Any

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notice hereunder this Agreement will be deemed effectively given and received: (a) if
personally delivered, upon delivery; or (b) if mailed, on the registered date or the date stamped
on the certified mail receipt.

     9.4 Captions. The various headings or captions in this Agreement are for convenience
only and will not affect the meaning or interpretation of this Agreement. When used herein, the
terms “Article” and “Section” mean an Article or Section of this Agreement, except as otherwise
stated.

     9.5 Governing Law. The validity, interpretation, construction, performance,
enforcement and remedies of or relating to this Agreement, and the rights and obligations of the
parties under this Agreement, will be governed by the substantive laws of the State of Minnesota
(without regard to the conflict of laws rules or statutes of any jurisdiction), and any and every
legal proceeding arising out of or in connection with this Agreement will be brought in the
appropriate courts of the State of Minnesota, each of the parties hereby consenting to the
exclusive jurisdiction of said courts for this purpose.

     9.6 Construction. Wherever possible, each provision of this Agreement will be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Agreement will be prohibited by or invalid under applicable law, such provision is
ineffective only to the extent of such prohibition or invalidity without invalidating the remainder
of such provision or the remaining provisions of this Agreement. To the extent that any provision
of this Agreement shall be determined to be invalid or unenforceable, the validity and
enforceability of the remainder of such provision and of this Agreement shall be unaffected.

     9.7 Waiver. No failure on the part of either party to exercise, and no delay in
exercising, any right or remedy hereunder this Agreement will operate as a waiver thereof, nor will
any single or partial exercise of any right or remedy under this Agreement preclude any other or
further exercise thereof or the exercise of any other right or remedy granted hereby or by any
related document or by law.

     9.8 Modification. This Agreement may not be modified or amended except by written
instrument signed by the parties hereto; provided, however, that t            his Agreement shall be
amended or modified by the parties when and as necessary to assure compliance with laws and
regulations related to executive compensation. It further is a matter of corporate governance that
executive employment agreements, including this Agreement, should be reviewed periodically, and no
less than once every three years while in effect, for the purpose of evaluating consistency with
company goals and objectives and alignment with interests of shareholders.

     9.9 Entire Agreement. Except as otherwise specifically provided herein, this
Agreement constitutes the entire agreement and understanding between the parties in reference to
all the matters agreed upon herein, and replaces in full all prior employment agreements,
understandings or undertakings of the parties related to the employment relationship, and any and
all such prior agreements or under this understandings are hereby rescinded and voided by mutual
agreement including, without limitation, that Executive Employment Agreement effective as of March
5, 2001, and that Change in Control Agreement dated as of February 24, 1999, provided, however,
that the Restricted Stock Agreement referred to in Article 4, dated January 2, 2001, [and all other
Plans] is and shall remain in full force and effect.

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     9.10 Survival. The provisions of this Agreement which by their express or implied
terms extend (a) beyond the termination of Executive’s employment hereunder (including, without
limitation, the provisions relating to separation compensation and effects of a Change in Control);
or (b) beyond the termination of this Agreement (including, without limitation the provisions in
Article 8 relating to confidential information, non-competition and non-solicitation), will
continue in full force and effect notwithstanding Executive’s termination of employment under this
Agreement or the termination of this Agreement, respectively.

     9.11 Section 409A. The Company shall, with the consent of Executive, timely amend
this Agreement as many times as may be required so that adverse tax consequences to the Executive
under Section 409A, including the imposition of any excise tax and interest penalties are avoided.
For purposes of this Section 9.1l, it is the intent of the Parties that the Agreement is amended
only to the extent required to comply with 409A and that the intended benefits to Executive,
including the amount, form and timing of such benefits as specified in this Agreement, will be
preserved to the greatest extent possible.

     9.12 Voluntary Agreement. Executive has entered into this Agreement voluntarily,
after having the opportunity to consult with an advisor chosen freely by Executive.

     9.13 Remedies. No civil action may be commenced for any claim or dispute relating to
this Agreement or arising out of Executive’s employment with Employer unless the parties, within
thirty (30) days after the date of either party’s written request, attempt in good faith to
promptly resolve the claim or dispute by negotiation at agreed time(s) and location(s). All
negotiations are confidential and will be treated as settlement negotiations. Notwithstanding the
foregoing, either party may seek equitable relief prior to such good faith efforts to preserve the
status quo pending the completion of such efforts.

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

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     IN WITNESS WHEREOF, the parties have caused this Executive Employment Agreement to be executed
and delivered as of the Effective Date.

EMPLOYER:

	 	 	 	 	 
	 	G&K SERVICES, INC.

 	 
	 	By   /s/ Richard L. Marcantonio
 	 
	 	Richard L. Marcantonio 	 
	Employer's Address: 	Chairman and Chief Executive Officer

5995 Opus Parkway

Suite 500

Minnetonka, MN 55343 	 
	 

	 	 	 	 	 
	 	 	 
	EXECUTIVE:  	/s/ Robert G. Wood
 	 
	 	Robert G. Wood 	 
	 	 	 
	 

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Exhibit List

Exhibit A — Release Agreement

Exhibit B — Release Agreement

Exhibit C — Restricted Stock Agreement

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