Document:

<PAGE>

                                                                   Exhibit 10(g)

February 11, 2002
T. Keith Moone
9054 E. Washington
Chagrin Falls, Ohio  4402
                                                       Revised February 21, 2002

Dear Keith:

This letter will serve as a Separation Agreement between Royal Appliance Mfg.
Co., its subsidiaries and affiliated companies collectively referred to as the
Company and you, which is being offered to you, due to the elimination of your
position.

1.     SEPARATION PAY
       --------------

       You will receive separation pay at a semi-monthly rate of $7708.34, plus
       $387.50 for car and phone allowance, starting February 15, 2002 through
       February 15, 2003. Payments will be made on a regular basis for the gross
       amount of your salary with appropriate deductions for federal, state and
       local taxes, social security contribution, health care contributions, and
       other deductions required by federal, state, or local law. If you obtain
       employment elsewhere during this period you will be eligible to receive
       the remaining amount of this separation pay in a lump sum less all
       applicable taxes and deductions within 30 days of notifying me and
       starting employment elsewhere. If you have not obtained employment
       elsewhere ( to include, but not limited to; direct employee, independent
       sales rep, consulting arrangements over 80 hours per month and business
       ventures) by February 15, 2003, your semi-monthly rate of $7708.34 will
       be continued, until the earlier of starting employment elsewhere or
       February 15, 2004.

2.     OTHER PAY
       ---------

       You will receive a lump sum payment of $89,500, subject to applicable
       federal, state and local deductions, as consideration for 2001 and 2002
       incentives and awards and forfeiture of all outstanding stock options and
       phantom stock rights, within 30 days of signing this agreement. The
       Company will reimburse you for legal fees incurred as a result of
       reviewing this agreement of up to $2,000.

3.     GROUP MEDICAL BENEFITS
       ----------------------

       You will continue to receive coverage under the provisions of the Royal
       Appliance Group Medical Coverage Plan through Royal paying the COBRA
       through August 15, 2003, or until benefits become effective at another
       employer, whichever comes first, on the same terms and conditions as
       presently provided by Royal Appliance. At that time, you will be entitled
       under COBRA to continue coverage for up to an additional 6 months
       provided that you pay the cost of the premium at the time that you elect
       to continue coverage. Further information regarding your COBRA rights
       will be sent to you at a later date.

<PAGE>

Page 2 of 4

4.     SAVINGS  PLANS
       --------------

       You are fully vested in the Royal Appliance 401(k) Savings Plan and
       401(k) Plus Plan. You will be entitled to keep your investments in the
       Plans or withdraw them according to the provisions of the Plans. Please
       understand that separation payments are not eligible for continued
       contributions to these Plans.

5.     LIFE, STD, LTD INSURANCE
       ------------------------

       Your life insurance coverage will continue through August 15, 2002, or
       when benefits become effective at another employer, whichever comes
       first. You may convert your life insurance to an individual policy within
       30 days of the expiration of your life insurance coverage. Short Term
       Disability and Long Term Disability insurances will discontinue after
       February 15, 2002.

6.     UNEMPLOYMENT COMPENSATION
       -------------------------

       You may be eligible for Unemployment Compensation and application should
       be made with your local unemployment insurance office.

7.     DATE OF TERMINATION
       -------------------

       Your employment with Royal Appliance Mfg. Co. will be terminated
       effective February 15, 2002.

8.     VACATION
       --------

       You will be paid for 132 hours vacation pay based on 96 hours of unused
       vacation pay for the current vacation year and 36 hours of banked
       vacation. This payment will be made within 30 days of signing this
       agreement.

9.     PROFESSIONAL OUTPLACEMENT
       -------------------------

       You are eligible to receive professional outplacement assistance through
       a professional firm contracted by the Company. This will be guaranteed
       for 6 months and will be extended on a monthly basis if needed.

10.    NON-COMPETE AND CONFIDENTIALITY
       -------------------------------

       By accepting these payments and in consideration of all other benefits
       offered to you, you agree that you will not compete with Royal Appliance
       Mfg. Co., it's parent company, it's affiliated companies and it's
       subsidiaries without the express written consent of the Company. This
       includes but is not limited to employment with or consulting with any
       company, firm, person or entities which competes directly or indirectly
       with Royal Appliance Mfg. Co. or entering into business as an owner, sole
       proprietor or representative which competes directly or indirectly with
       Royal Appliance Mfg. Co. This agreement not to compete will be in effect
       until February 15, 2003.

       By signing this agreement and accepting these payments, you agree not to
       disclose the terms of the separation agreement, except to members of your
       immediate family, accountant, attorney, or as otherwise required by law.
       You also agree that you will not make or publish any negative comments or
       disparaging remarks concerning Royal Appliance Mfg. Co., its employees,
       officers, suppliers and customers.

11.    TRADE SECRETS
       -------------

       You acknowledge that as an employee of Royal you executed a Technical
       Information and Non-Competition Agreement and you hereby reaffirm the
       validity of and continue to abide by. Said Agreement is expressly
       incorporated herein by reference. You are obligated not to reveal,
       disclose, sell, provide, submit or otherwise make known the trade secrets
       of Royal Appliance Mfg. Co. Trade secrets include but are not limited to
       designs, discoveries, improvements, innovations and ideas, whether or not
       patented or patentable, relating to any part of the business or
       activities of the Company including, without limitation, present, novel
       or improved products, processes, machines, methods of manufacturing,
       promotional and advertising materials or schemes and other manufacturing
       and sales techniques.

<PAGE>

Page 3 of 4

       TRADE SECRETS (CONTINUED)
       -------------------------

       Trade secrets also include the confidential information of the Company
       which includes but is not limited to the Company's products, sales
       methods, customer terms, co-op agreements, customer lists, customer
       pricing, supplier pricing, customer usages, manufacturing procedures,
       manufacturing distribution processes, policies and practices of the
       Company, equipment, costs of production and overhead, compositions,
       technology, formulas, know-how, research and development programs,
       financial information, blueprints, drawings, drafts or other written and
       electronic material of the Company.

12.    RELEASE OF ALL CLAIMS
       ---------------------

       By signing this Agreement, and by accepting the payments set forth above,
       you agree to release and discharge and forever forego any claims,
       demands, suits, causes of action or other legal rights which you have or
       may have against Royal Appliance Mfg. Co., its employees, agents, owners,
       directors, officers or other representatives which presently exist as a
       result of your employment with the Company or as the result of your
       termination from your employment with the Company. These claims include,
       but are not limited to, claims under the Civil Rights Act of 1964, the
       Civil Rights Act of 1991, the Age Discrimination in Employment Act, the
       Older Workers Benefits Protection Act, the Americans with Disabilities
       Act, the Ohio Anti-Discrimination Statutes and any other claim for breach
       of contract, express or implied and any claim under any state or federal
       statute or regulation. By signing this agreement, you also acknowledge
       that you have received additional monetary consideration for waiver of
       any claims that you may have under the Older Workers Benefits Protection
       Act and the Age Discrimination in Employment Act. Under these acts you
       are advised of your right to consult with an attorney prior to the
       execution of this agreement and have at least twenty one (21) days from
       the date of this letter to consider the separation agreement. You further
       are advised that you have seven (7) days following the execution of the
       separation agreement to revoke the agreement and the separation agreement
       shall not become effective and enforceable until the revocation period
       has expired. Your acceptance of this letter will serve as your
       acknowledgment of the receipt of and the acceptance of the consideration
       described in paragraphs one through ten above in complete and final
       settlement as full compensation for any claims or damages of whatever
       nature suffered by you in connection with your employment with and
       termination by Royal Appliance Mfg. Co. You understand and agree that
       this release will be considered to be final and shall be a complete bar
       to any legal or equitable action which might be brought by you in
       connection with your employment with the Company and your termination
       from the Company.

Any breach by you of any term or condition of this letter or any contract that
you may have with the Company will release the Company from any further
liability to make the payments referred above, or provide benefits described
above except as required by law but will not otherwise release you from your
obligations under this agreement. Furthermore, you agree that a breach of any of
the conditions of this agreement will result in irreparable and continuing
damage to Royal for which there will be no adequate remedy at law. If you breach
any of the provisions of this agreement, Royal shall be entitled to injunctive
relief in addition to all other remedies available at law or in equity.

You are advised of your right to consult with an attorney prior to the execution
of this agreement. This offer will remain open until 5:00 p.m., March 5, 2002.

This letter is presented to you in duplicate. After a full review of the letter,
if you are in full agreement with the terms of the letter, sign the letter and
return one (1) copy of the letter to me to indicate that you have read and
understood the agreement, that you are in full agreement with the terms of the
separation agreement and that your signature is voluntary and given in return
for the payments outlined above.

<PAGE>

Page 4 of 4

Please call me at (440) 996-2000 or Tim Araps at (440) 996-2000, if you have any
questions. Thank you.

                                                    Date:
--------------------------------                          ----------------------
       Michael J. Merriman

I have received, read and understood the terms of the above agreement. I fully
agree with the terms of the agreement and my signature is voluntary given.

                                                    Date:
--------------------------------                          ----------------------
        T. Keith Moone<PAGE>
                                                                   Exhibit 10(i)

                              EMPLOYMENT AGREEMENT

     THIS AGREEMENT ("Agreement"), dated as of March 14, 2002 is between MICHAEL
J. MERRIMAN ("Merriman") and ROYAL APPLIANCE MFG. CO., an Ohio corporation
("Royal").

     WHEREAS, Merriman has been President and Chief Executive Officer of Royal
pursuant to an employment agreement dated September 15, 1995;

     WHEREAS, Royal desires to continue to employ Merriman pursuant to the terms
of this Agreement;

     WHEREAS, Royal and Merriman desire to replace the Severance and Employment
Agreement between them originally executed in 1995; and

     WHEREAS, Merriman desires to accept such continuing employment on the terms
set forth in this Agreement.

     NOW THEREFORE, in consideration of the premises and mutual covenants set
forth herein and for other good and valuable consideration the parties agree as
follows:

     1. DEFINITION OF CERTAIN TERMS. For the purposes of this Agreement, the
terms listed below shall be defined as follows:

         "Affiliate" shall mean any corporation or other business entity that
directly or indirectly is controlled by the Company and any joint venture,
partnership or other legal entity in which the Company has a significant
ownership interest.

         "Board" shall mean the Company's Board of Directors.

         "Cause" shall have the meaning set forth in Section 6.C.

         "Company" shall mean Royal and its successors and assigns.

         "Change in Control" shall mean a change in control of a nature that
would be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A or Item 1 of Form 8-K (or any similar item or successor schedule,
form, or report) promulgated under the Securities Exchange Act of 1934 as
amended ("Exchange Act"); provided that, without limitation, such a change in
control shall be deemed to have occurred if and at such times as (i) any
"person" (as such term is used in Sections 13(d)(3) and 14(d)(2) of the Exchange
Act) becomes the beneficial owner, directly or indirectly, of securities of the
Company representing 30% or more of the combined voting power of the Company's
then outstanding securities, or (ii) during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board cease for
any reason to constitute at least a majority (i.e., more than one-

<PAGE>

half) thereof unless the election, or the nomination for election by the
Company's shareholders, of each new director during such two-year period was
approved by an affirmative vote of at least two-thirds of the directors then
still in office who were directors at the beginning of said two-year period. In
addition, a change of control shall be deemed to have occurred if there is (a)
the sale, lease or other transfer in one or more transactions not in the
ordinary course of business of a total of seventy percent (70%) or more of the
Company's assets, or (b) any merger or consolidation between the Company and
another corporation or other legal entity immediately after which the Company's
stockholders immediately prior to the transaction hold, directly or indirectly,
less than fifty percent (50%) of the combined voting power of the Company or its
successor.

         "Disability" shall mean Merriman's inability to perform all of his
duties for an aggregate of 90 days in any 12 consecutive month period due to a
physical or mental incapacity based upon evidence of a licensed physician who
has been mutually agreed to by Merriman (or his primary care giver if Merriman
is physically unable to agree) and Royal.

         "Effective Date" shall mean the date of this Agreement as set forth in
the first line above.

         "Executive" shall mean Merriman.

         "Good Reason" shall have the meaning set forth in Section 6.C.

         "Noncompete Period" shall have the meaning set forth in Section 7.

         "Term" shall have the meaning set forth in Section 2.

     2. TERM OF EMPLOYMENT. The initial term of this Agreement shall commence on
the Effective Date of this Agreement and shall expire on the first anniversary
thereof ("Term"); PROVIDED, HOWEVER, that the Term shall be automatically
extended for successive one-year periods, unless not later than 60 days prior to
the end of the initial term or any automatic extension thereof, the Company or
Merriman shall have given the other party written notice to the contrary. If the
Company gives notice of its intention not to renew this Agreement, Merriman will
be entitled to the severance benefits set forth in Section 6.A hereof.

     3. POSITION.

         A. During the Term, Merriman will be employed as President and Chief
Executive Officer of the Company. Merriman will devote substantially all his
business time to the performance of his duties hereunder, will engage in no
other business activities without permission of the Board and will perform his
duties hereunder to the best of his abilities; PROVIDED, HOWEVER, that Merriman
may serve as an outside director for any three (3) companies that do not compete
with the Company or any of its Affiliates; and PROVIDED, FURTHER, that such
services do not adversely affect the performance of his duties hereunder.
Merriman will report to the Board. In addition, Merriman will serve on the Board
without additional compensation.

                                       2
<PAGE>

         B. In his capacity as President and Chief Executive Officer of the
Company, Merriman shall have the executive authority, responsibilities and
duties typically held and executed by a chief executive officer of a nationally
recognized manufacturing and sales corporation. Without limiting the foregoing,
Merriman shall (i) attend all meetings of the Board; and (ii) assist the Board
and its committees in the exercise of the Board's duties and responsibilities,
in each case as requested by, and pursuant to the direction of, the Board.

         C. Additionally, Merriman may make and manage personal business
investments of his choice and serve in any capacity with any civic, educational
or charitable organization, or trade association, without seeking or obtaining
written approval of the Board, if such investments, activities and services do
not significantly interfere or conflict with the performance of his duties
hereunder or the interests of the Company. Written approval is required from the
Board with respect to Merriman serving in any capacity with any federal, state
or local governmental entity.

         D. PRINCIPAL OFFICE. Merriman's principal office and normal place of
work shall be at the Company's principal executive offices in Glenwillow, Ohio.

     4. COMPENSATION. During the Term, Merriman shall be entitled to annual
compensation from the Company consisting of (i) a Salary, (ii) a Cash Bonus (if
earned), and (iii) Stock Options and Phantom Stock Rights granted by the Board
in its discretion, subject to the terms and conditions set forth in A., B., and
C. as follows:

         A. SALARY. The Company shall pay Merriman an annual base salary ("Base
Salary") of Four Hundred Thousand Dollars ($400,000) payable in 24 equal
semi-monthly installments. State, local and federal income tax withholdings and
other normal employee deductions will be deducted from the gross salary prior to
payment to Merriman. Merriman's Base Salary shall be reviewed annually by the
Board and increases, if any, will be made at the discretion of the Board.
Merriman's Base Salary may not be reduced without his consent.

         B. CASH BONUS PROGRAM. At the end of each fiscal year during the Term,
Merriman may earn a cash bonus pursuant to the Company's annual management
incentive plan ("MIP"). The annual MIP payment to Merriman will be calculated as
a percentage of Merriman's annual Base Salary, the percentage based upon the
Company's actual performance compared to the various targeted levels set forth
by the Board at the beginning of each fiscal year. The annual MIP payment will
be paid to Merriman by February 15th following each annual calendar period.

         C. STOCK OPTIONS AND PHANTOM STOCK RIGHTS. Merriman may receive, from
time to time, during the Term, such stock options and phantom stock rights as
are awarded by the Board or a Committee of the Board under plans authorized by
the Board.

     5.  BENEFITS AND EXPENSES.

         A. During the Term, the Company will provide benefits to Merriman no
less favorable than those benefits made available to other Company senior
management members,

                                       3
<PAGE>

including participation in group term life insurance, group health,
hospitalization, dental and vision coverage, disability coverage, the 401(k)
retirement plan, and maintenance of the current vacation plan providing for six
(6) weeks of paid vacation per year which will accrue year to year if unused.

         B. Reasonable travel, entertainment and other business expenses
incurred by Merriman in the performance of his duties hereunder shall be
reimbursed by the Company in accordance with Company policies in effect from
time to time.

         C. During the Term, the Company shall provide Merriman with a monthly
car allowance for the sole purpose of defraying lease expenses, such allowance
not to exceed $700 per month. The Company shall also reimburse Merriman for
monthly country club dues not to exceed $700 per month. The Company shall also
continue to pay all professional dues currently paid for Merriman, including
those to the Young Presidents Organization.

         D. Merriman shall be indemnified by the Company against claims arising
in connection with his status as an employee, officer, director or agent of the
Company in accordance with the Company's policies in effect from time to time,
subject to applicable law.

      6. BENEFITS UPON TERMINATION.

         A. In the event of Merriman's termination without Cause, termination
due to death or Disability, if Merriman terminates his employment for Good
Reason or if the Company gives notice of its intention not to renew this
Agreement (collectively, "Triggering Termination"), Merriman, or his estate,
shall be entitled to the following severance benefits:

          (i) Basic severance equal to three times the sum of Merriman's current
     annual Base Salary and Merriman's average annual MIP earned over the three
     (3) most recent completed fiscal years of the Company, with such basic
     severance payable in six (6) equal semi-annual installments beginning
     within thirty (30) days after the effective date of the Triggering
     Termination. Notwithstanding the foregoing, if there is a Change in Control
     after the Effective Date but before the Triggering Termination, the basic
     severance shall be accelerated and paid in full as a lump sum (without any
     discount) within thirty (30) days after the Triggering Termination. The
     balance of any unpaid basic severance shall be accelerated and paid in full
     (without any discount), in a lump sum, upon any Change in Control that
     occurs after a Triggering Termination;

          (ii) An additional lump sum severance, payable within 30 days of the
     Triggering Termination. This amount will be determined and set annually
     each February by the Board and the amount so set shall govern until the
     next determination by the Board. Such additional lump sum severance amount
     will not be adjusted up or down by more than 33% from the previous year's
     amount. The additional lump sum severance amount for 2002 through February
     2003 will be $1,500,000;

                                       4
<PAGE>

          (iii) The Company shall forgive any amount remaining due from Merriman
     on the note payable to the Company in the original principal amount of
     $542,750 that Merriman signed on April 2, 2001; and

          (iv) Payment of Executive's Base Salary through the date of
     termination.

         These severance benefits are in addition to any benefits to which
Merriman shall be entitled to under the Company's benefit plans, including a pro
rata MIP payment (based on the period of time served during the year in which
the Triggering Termination occurs), if any, for the year in which the Triggering
Termination occurs to be paid to Merriman by the next February 15 and any unpaid
MIP payment for a prior year, group health, hospitalization, dental and vision
coverage for him and his family on the same basis as active senior management of
the Company for the 36 months subsequent to the Triggering Termination, and
accrued vacation. As a result of any Triggering Termination or immediately after
a Change in Control, the Company agrees to continue in effect any perquisite,
benefit or compensation plan (including its annual bonus plan, long-term
incentive plan, section 401(k) plan, dental plan, life insurance plan, health
and accident plan, disability plan, 401(k) Plus Plan, or deferred compensation
plan) in which the Executive is currently participating (collectively referred
to as the "Benefit Plans"), or to maintain plans providing substantially similar
benefits, unless the continuation of any such plan (or similar plan) would, in
the good faith determination of the Board, have a material adverse economic
effect on the Company taking into account all facts and circumstances. Other
than as provided in the preceding sentence, the Company agrees after a Change in
Control and/or for the period 36 months subsequent to the Triggering Termination
not to take any action that would adversely affect the Executive's participation
in, or materially reduce the benefits under, any of the Benefit Plans or deprive
the Executive of any material fringe benefit currently enjoyed.

         B. If Merriman's employment (i) is terminated by the Company for Cause,
or (ii) is voluntarily terminated by Merriman for other than Good Reason,
Merriman's employment hereunder shall terminate. In addition to any benefits to
which Merriman shall be entitled under the Company's benefit plans, including
the MIP payment for the year in which the termination occurred (and any such
unpaid amount for a prior year) and accrued vacation, the Company shall pay his
unpaid Base Salary to the date of that termination to Merriman.

         C. The following terms shall have the meanings specified below:

          (i) "Cause" shall mean the following: (1) an act or acts of dishonesty
     by the Executive constituting a felony and resulting or intended to result
     directly or indirectly in substantial gain or personal enrichment at the
     expense of the Company; or (2) the willful and continued failure by the
     Executive substantially to perform his duties with the Company (other than
     any such failure resulting from incapacity due to mental or physical
     illness) after a demand in writing for substantial performance is delivered
     by the Board, which demand specifically identifies the manner in which the
     Board believes that the Executive has not substantially performed his
     duties, and such failure results in demonstrable material injury to the
     Company. The Executive's employment shall in no event be considered to have
     been terminated by the Company for Cause if such

                                       5
<PAGE>

     termination took place as the result of (1) bad judgment or negligence, or
     (2) any act or omission without intent of gaining therefrom directly or
     indirectly a profit to which the Executive was not legally entitled, or (3)
     any act or omission believed in good faith to have been in or not opposed
     to the interest of the Company, or (4) any act or omission in respect of
     which a determination be made that the Executive met the applicable
     standard of conduct prescribed for indemnification or reimbursement or
     payment of expenses under the Regulations of the Company or the laws of the
     State of Ohio, in each case as in effect at the time of such act or
     omission. The Executive shall not be deemed to have been terminated for
     Cause unless and until there shall have been delivered to him a copy of a
     resolution duly adopted by the affirmative vote of not less than
     three-quarters of the entire membership of the Board (other than Executive)
     at a meeting of the Board called and held for that purpose (after
     reasonable notice to the Executive and an opportunity for him, together
     with his counsel, to be heard before the Board), finding that in the good
     faith opinion of the Board the Executive was guilty of conduct set forth
     above in clauses (1) or (2) of the first sentence of this paragraph and
     specifying the particulars thereof in detail.

          (ii) "Good Reason" will exist if any one or more of the following
     occur:

               (1) failure by the Company or its Affiliates to honor any of its
          obligations under Sections 4.A., 4.B., 4.C., 5.A., 5.B., 5.C., 5.D. or
          14., or

               (2) an adverse change in nature or scope of the authority,
          powers, functions, responsibilities or duties attached to the position
          of President and Chief Executive Officer with the Company (as such
          position existed on the Effective Date) (including but not limited to
          assignment by the Company to Merriman of duties inconsistent with his
          current position, duties, responsibilities, and status with the
          Company or a change of his reporting responsibilities or titles
          currently in effect) without the prior written consent of Merriman,
          which is not remedied within ten (10) calendar days after receipt by
          the Company of written notice from Merriman of such change; or

               (3) if a change in circumstances significantly affecting
          Merriman's position has occurred (including, without limitation, a
          change in the scope of the business or other activities for which he
          is responsible), and as a result thereof Merriman has been rendered
          substantially unable to carry out, has been substantially hindered in
          the performance of, or has suffered a substantial reduction in, any of
          the authorities, powers, functions, responsibilities or duties
          attached to the position of President and Chief Executive Officer (as
          such position existed on the Effective Date), which situation is not
          remedied within ten (10) calendar days after written notice to the
          Company from Merriman; or

               (4) the Company shall, without Merriman's prior written consent,
          relocate its principal executive offices, or require Merriman to have
          his principal location of work changed, to any location which is in
          excess of thirty

                                       6
<PAGE>

          (30) miles from the current location thereof or cause Merriman to
          travel away from his office in the course of discharging his
          responsibilities or duties significantly more (in terms of consecutive
          days or aggregate days in any calendar year) than was required of him
          previously; or

               (5) failure to elect or reelect or maintain Merriman as President
          and Chief Executive Officer or the removal of Merriman as a director
          of the Company.

               (6) After a Change in Control, any purported termination by the
          Company of Executive's employment that is not effected pursuant to a
          Notice of Termination satisfying the requirements of Section 6.D. and,
          for purposes of this Agreement, no such purported termination shall be
          effective, provided, if the failure to comply with Section 6.D. occurs
          despite the Company's good faith efforts to comply, no Good Reason
          shall exist and the provisions of Section 6.D. shall govern.

          D. Any purported termination of employment by the Company for Cause
shall be communicated by written Notice of Termination to Merriman in accordance
with Section 15 hereof. For purposes of this Agreement, a "Notice of
Termination" shall mean a notice which shall indicate the specific termination
provision in this Agreement relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for termination of
employment under the provision so indicated. Any good faith failure to comply
with the provisions of this Section D. or Section 15 shall require that the
process set forth in this Section 6D. be repeated to comply with such
provisions.

       7. CONFIDENTIALITY; NONDISPARAGEMENT; NONSOLICIATION; NONCOMPETITION.

          A. Merriman acknowledges the time and expense incurred by the Company
and its subsidiaries in connection with developing proprietary and confidential
information in connection with its businesses and operations. Merriman agrees
that he will not at any time during the Term, and for 36 months after
termination of his employment ("Noncompete Period"), divulge, communicate, use
to the detriment of the Company or any of its subsidiaries or Affiliates
(collectively, the "Group") or for the benefit of an other person, firm or
entity, or misappropriate in any way, any confidential information or trade
secrets relating to the Group, including without limitation, business
strategies, operating plans, acquisition strategies (including the identities of
(and any other information concerning) possible acquisition candidates), pro
forma financial information, marketing analyses, acquisition terms and
conditions, personnel information, trade processes, manufacturing methods,
know-how, customer lists and relationships, supplier lists, or other non-public
proprietary and confidential information relating to the Group, except to the
extent such information is lawfully obtainable from public sources or such use
or disclosure is (i) necessary to the performance of Merriman's duties under
this Agreement, (ii) required by applicable laws, regulations, or by the rules
of a self regulatory organization, or (iii) authorized by the Company.
Additionally, during the Noncompete Period, Merriman will not make disparaging
remarks about the Company or any of its Subsidiaries, employees, directors,
suppliers or customers.

                                       7
<PAGE>

          B. During the Noncompete Period, Merriman shall not, directly or
indirectly, for himself or on behalf of any other person, firm or entity,
employ, engage or retain any person who at any time during the preceding
12-month period was an employee or consultant of any member of the Group or
contact any supplier, customer, employee or consultant from the Group for the
purpose of soliciting or diverting any such supplier, customer, employee or
consultant from any member of the Group or otherwise interfering with the
business relationship of any member of the Group with any of the foregoing,
without prior written authorization from the Company.

          C. During the Noncompete Period, Merriman shall not, directly or
indirectly, engage in, or serve as a principal, partner, joint venturer, member,
manager, trustee, agent, stockholder, director, officer, or employee of, or
consultant or advisor to, or in any other capacity, or in any manner, own,
control, manage, operate, or otherwise participate, invest, or have any interest
in, any person, firm or entity that engages in North America in the floor care
business or in any business that is competitive with any product code or any
other business that generated 10% of the revenues of the Group within the
preceding 24-month period, without prior written authorization from the Company;
provided, however, that the ownership of less than 5% of the outstanding equity
securities of a publicly traded corporation or other publicly traded legal
entity shall not in and of itself be a violation of this Section 7.C.

          D. Merriman acknowledges that his employment by the Company and
agreements herein (including the agreements of this Section 7) are reasonable
and necessary for the protection of the Company and are essential inducements to
the Company entering into this Agreement. Accordingly, Merriman shall be bound
by the provisions hereof (including the provisions of this Section 7) to the
maximum extent permitted by law, it being the intent and spirit of the parties
that the foregoing shall be fully enforceable. However, the parties further
agree that, if any of the provisions of this Section 7 shall for any reason be
held to be excessively broad as to duration, geographical scope, or subject
matter, such provision shall be construed by limiting and reducing it so as to
be enforceable to the extent compatible with the applicable law as it shall
herein pertain.

          E. Merriman acknowledges that the services to be rendered under the
provisions of this Agreement are of a unique nature and that it would be
difficult or impossible to replace such services and that by reason thereof,
Merriman agrees and consents that if he violates the provisions of this Section
7, the Company, in addition to any other rights and remedies available under
this Agreement or otherwise, shall be entitled to an injunction to be issued or
specific performance to be required restricting Merriman from committing or
continuing any violation of the provisions of this Section 7.

          F. Notwithstanding any other provision of Section 7, if a Change in
Control occurs subsequent to a Triggering Termination, the Noncompete Period
shall end one year after any Change in Control unless it would otherwise
terminate earlier. If there is a Change in Control after the Effective Date but
on or before the date of a Triggering Termination, the Noncompete Period shall
end one year after such termination.

                                       8
<PAGE>

          8. GOVERNING LAW; JURISDICTION AND VENUE. This Agreement shall be
governed by and construed in accordance with the laws of the State of Ohio,
without giving effect to the conflict of law provisions thereof. Any claim or
action arising hereunder shall be litigated exclusively in the Court of Common
Pleas, Cuyahoga County, Ohio or federal courts situated in the Northern District
of Ohio, Eastern Division, and each party irrevocably consents and submits to
the personal and subject matter jurisdiction of said courts.

          9. ENTIRE AGREEMENT. This Agreement sets forth the entire agreement
and understanding between the parties with respect to the subject matter hereof
and supersedes and cancels any and all prior discussions, correspondence,
agreements or understandings (whether oral or written) between the parties
hereto with respect to such matters, excluding any agreements relating to stock
option and phantom stock grants or indemnity as an employee, officer, director
or agent. Any representation, premise or condition, whether written or oral, not
specifically incorporated herein, shall be of no binding effect upon the
parties.

          10. SEVERABILITY; ASSIGNMENT.

            A. Except for Section 7 hereof, if any portion of this Agreement is
held invalid or unenforceable by a court of competent jurisdiction, such portion
shall be deemed deleted as though it had never been included herein, but the
remainder of this Agreement shall remain in full force and effect.

            B. This Agreement shall not be assignable by Merriman except
pursuant to the laws of decent and distribution and then only for purposes of
enforcing Merriman's rights hereunder and shall be assignable by the Company
only with the consent of Merriman, PROVIDED, HOWEVER, that the Company may
assign its rights and obligations under this Agreement without consent of
Merriman in the event that the Company shall effect a Sale of the Company that
would constitute a Change in Control.

          11. COOPERATION WITH REGARD TO LITIGATION. Merriman agrees to
cooperate with the Company during the Noncompete Period by making himself
reasonably available to testify on behalf of the Company or its Affiliates, in
any action, suit or proceeding, whether civil, criminal, administrative, or
investigative and to assist the Company or any of its Affiliates in any such
action, suit, or proceeding by providing information and meeting and consulting
with its counsel and representatives. Merriman shall be reimbursed promptly for
all out of pocket expenses incurred in satisfying his obligations under this
Section 11.

          12. WAIVER; AMENDMENT. No provision hereof may be waived except by a
written agreement signed by all parties hereto. The waiver of any term or of any
condition of this Agreement shall not be deemed to constitute a waiver of any
other term or condition. This Agreement may be amended only by a written
agreement signed by all parties hereto.

                                       9
<PAGE>

          13. SURVIVAL OF PAYMENT PROVISIONS. The payment provisions of Sections
5, 6, 11, 14, 18, 19 and 20 hereof shall survive the expiration, suspension or
termination, for any reason, of this Agreement.

          14. SUCCESSORS; BINDING AGREEMENT. This Agreement shall inure to the
benefit of, and be binding upon, the Company, its successors and permitted
assigns. The Company will require any successor or assignee (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company, by agreement in
form and substance satisfactory to the Executive, to expressly assume and agree
to perform this Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession had taken place.
Failure of the Company to obtain such agreement prior to the effectiveness of
any such succession shall be a breach of this Agreement and shall entitle the
Executive to compensation from the Company in the same amount and on the same
terms as would apply if the Executive terminated his employment for Good Reason.
This Agreement shall also inure to the benefit of and be binding upon Merriman,
his personal or legal representatives, his executors, administrators, heirs,
distributees, devisees and legatees. If Merriman should die while any amount
would still be payable hereunder had Merriman continued to live, all such
amounts, unless otherwise provided herein, shall be paid in accordance with the
terms of this Agreement to his devisee, legatee, or other designee or, if there
be no such designee, to his estate.

          15. NOTICE. For the purpose of this Agreement, notices and all other
communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when personally delivered or delivered by
recognized overnight courier or mailed by United States registered mail, return
receipt requested, postage prepaid, addressed to the Secretary of the Company,
7005 Cochran Road, Glenwillow, Ohio 44139, and addressed to Merriman (currently,
16361 Misty Lake Glen, Chagrin Falls, Ohio 44023) at his last known address
contained in the personnel records of the Company, or to such other address as
either party may have furnished to the other in writing in accordance herewith,
except that notice of change of address shall be effective only upon receipt.

          16. WITHHOLDING TAXES. The Company may withhold from any amounts
payable under this Agreement such federal, state and local taxes as may be
required to be withheld pursuant to any applicable law or regulation.

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

          18. SET-OFF; INTEREST ON OVERDUE PAYMENTS. There shall be no right of
set-off or counterclaim against, or delay in, any payment by the Company to
Merriman hereunder in respect of any claim against or debt or obligation of
Merriman, whether arising hereunder or otherwise. Without limiting the rights of
Merriman at law or in equity, if the Company fails to make any payments
hereunder on a timely basis, the Company shall pay interest on the amount

                                       10
<PAGE>

thereof at an annualized rate equal to the rate in effect, at the time such
payment should have been made, under the Company's 401(k) plan for loans to
participants in such plan.

      19. PARACHUTE PAYMENTS.

          A. If it shall be determined that any payment, distribution or benefit
received or to be received by Merriman from the Company or any of its
Affiliates, whether paid or payable or distributed or distributable pursuant to
the terms of this Agreement or otherwise pursuant to or by reason of any other
agreement, policy, plan, program or arrangement, including without limitation
any stock option, phantom stock, performance share, performance unit, restricted
stock, stock appreciation right or similar right, or the lapse or termination of
any restriction on, or the vesting or exercisability of, any of the foregoing
(individually and collectively, "Payments") would be subject to the excise tax
imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the
"Code") or to any similar tax imposed by state or local law, or to any interest
or penalties with respect to such taxes (such tax or taxes, together with any
such interest and penalties, being hereafter collectively referred to as the
"Excise Tax"), then Merriman shall be entitled to receive an additional payment
from the Company (the "Excise Tax Gross-Up Payment") in an amount such that the
net amount retained by Merriman, after the calculation and deduction of any
Excise Tax on the Payments (together with any penalties and interest that have
been or will be imposed on Merriman in connection therewith) and any federal,
state and local income taxes, Excise Taxes and payroll taxes (including the tax
imposed by Section 3101(b) of the Code) on the Excise Tax Gross-Up Payment
provided for in this Section 19, shall be equal to the Payments. In computing
the amount of this payment, it shall be assumed that Merriman is subject to tax
by each taxing jurisdiction at the highest marginal tax rate in the respective
taxing jurisdiction of Merriman, taking into account the city and state in which
Merriman resides, but giving effect to the tax benefit, if any, which Merriman
may enjoy to the extent that any such tax is deductible in determining the tax
liability of any other taxing jurisdiction (provided that the highest marginal
tax rate for federal income tax purposes shall be determined under Section 1 of
the Code).

          B. All determinations required to be made under this Section 19,
including whether and when an Excise Tax Gross-Up Payment is required and the
amount of such Excise Tax Gross-Up Payment and the assumptions to be utilized in
arriving at such determination, except as specified in Section 19.A., shall be
made by the Company's independent auditors (the "Accounting Firm"), which shall
provide detailed supporting calculations both to the Company and Merriman within
15 business days after the Company makes any Payments to Merriman. The
determination of tax liability and the assumptions made by the Accounting Firm
shall be subject to review by Merriman's tax advisor, and, if Merriman's tax
advisor does not agree with the determination reached by the Accounting Firm,
then the Accounting Firm and Merriman's tax advisor shall jointly designate a
nationally-recognized public accounting firm within five (5) business days after
notice has been given to the Company of Merriman's disagreement with the
Accounting Firm's calculation, which shall make the determination within 15
business days after its appointment. If the parties cannot agree on a nationally
recognized public accounting firm, then both parties shall select a nationally
recognized public accounting firm who shall then jointly select a third
nationally recognized public accounting firm which shall make the determination
within 15 business days after its appointment. All fees and expenses of the

                                       11
<PAGE>

accountants and tax advisors retained by either Merriman or the Company shall be
borne by the Company. Any Excise Tax Gross-Up Payment, as determined pursuant to
this Section 19, shall be paid by the Company to Merriman within five (5) days
after the receipt of the determination, subject to applicable federal, state,
local and Excise Tax withholding requirements. Any determination by a jointly
designated public accounting firm shall be binding upon the Company and
Merriman. If an accounting firm determines that no Excise Tax is payable by
Merriman, it shall, at the same time as it makes such determination, furnish the
Company and Merriman an opinion that Merriman has substantial authority not to
report any Excise Tax on his federal, state or local income or other tax return.

          C. As a result of the uncertainty in the application of Section 4999
of the Code at the time of the initial determination hereunder, it is possible
that Excise Tax Gross-Up Payments will not have been made by the Company that
should have been made consistent with the calculations required to be made
hereunder ("Underpayment"). In the event that the Internal Revenue Service
("IRS"), on audit, asserts that Merriman has made an underpayment and Merriman
is required (by reason of settlement or otherwise) to make a payment of any
Excise Tax, or if Merriman is required to make one or more payments of Excise
Tax to the IRS (and/or interest or penalties thereon) upon the filing of his
original or amended tax returns which exceed the amounts taken into account in
determining the initial Excise Tax Gross-Up Payment made pursuant to Sections
19A. and B., then in either of such events, any such Underpayment calculated in
accordance with and in the same manner as the Excise Tax Gross-Up Payment in
Section 19.A. shall be promptly paid by the Company to or for the benefit of
Merriman. In addition, the Company will pay Merriman an amount equal to any
penalties, interest or additions to be assessed against him as a result of the
Underpayment, which amounts shall be grossed up for any federal, state, local or
Excise Taxes payable with respect to such penalties, interest or additions to
tax such that Merriman receives a net amount equal to the penalties, interest
and additions to tax assessed against him (determined in the same manner as
described in Section 19.A.). Merriman shall not be obligated to contest any
proposed assessment of any Underpayment and may settle any such audit action or
proceeding involving an Underpayment at his discretion; provided, however, that
Merriman shall, upon notice of examination by the IRS, give notice thereof to
the Company and the Company, at its sole cost and in its sole discretion, may,
on behalf of Merriman, defend and contest against any proposed IRS deficiency.
In the event that the Company assumes the defense of the proposed deficiency,
the Company shall immediately, upon written request of Merriman, secure all of
its possible obligations to Merriman as provided for in this Section 19.C. by
either posting cash collateral in escrow or providing Merriman with a "clean
irrevocable letter of credit" in the amount of all of the Company's possible
obligations to Merriman pursuant to this Section 19.C. The terms of such escrow
or clean irrevocable letter of credit shall be negotiated by Company and
Merriman at such time. Merriman agrees to execute any documents, including
Powers of Attorney, that may be necessary to facilitate Company's defense and/or
contesting the IRS' assertions. In the event that the Excise Tax Gross-Up
Payment exceeds the amount subsequently determined to be due, such excess shall
constitute a loan from the Company to Merriman payable on the fifth day after
demand by the Company (together with interest at the rate provided in Section
1274(b)(2)(B) of the Code).

                                       12
<PAGE>

          20. LEGAL FEES AND EXPENSES. It is the intent of the Company that the
Executive not be required to incur the legal expenses associated with (i)
negotiation or interpretation of any provision in, or obtaining of any right or
benefit under, this Agreement or (ii) the enforcement of his rights under this
Agreement by litigation or other legal action, because the cost and expense
thereof would substantially detract from the benefits intended to be extended to
the Executive hereunder. Accordingly, the Company irrevocably authorizes the
Executive from time to time to retain counsel of his choice, at the expense of
the Company as hereafter provided, to represent the Executive in connection with
the negotiation and interpretation or enforcement of this Agreement, including
the initiation or defense of any litigation or other legal action, whether by or
against the Company or any Director, officer, stockholder or other person
affiliated with the Company, in any jurisdiction. Notwithstanding any existing
or prior attorney-client relationship between the Company and such counsel, the
Company irrevocably consents to the Executive's entering into an attorney-client
relationship with such counsel, and in that connection the Company and the
Executive agree that a confidential relationship shall exist between the
Executive and such counsel. The Company shall pay or cause to be paid and shall
be solely responsible for any and all reasonable attorneys' and related fees and
expenses incurred by the Executive under this Section 20.

         Executed in Glenwillow, Ohio this 14th day of March, 2002.

ROYAL APPLIANCE MFG. CO.

By:
         ------------------------------     ---------------------------------
         R. Louis Schneeberger              Michael J. Merriman
         Chairman of the Board

                                       13

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00035-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00035-of-00352.parquet"}]]