Document:

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                                                                  EXECUTION COPY

                                  Nortek, Inc.
                              Nortek Holdings, Inc.
                                50 Kennedy Plaza
                              Providence, RI 02903

As of August 27, 2004

Mr. David B. Hiley
845 RioMar Drive
Vero Beach Fla. 32963

Dear David:

      This agreement is made and entered into by Nortek, Inc. and Nortek
Holdings, Inc. (together, the "Company") and you to confirm your consulting
arrangements following the Acquisition (defined below), as follows:

      1. You will provide consulting services to the Company hereunder as an
independent contractor in accordance with your arrangements in effect
immediately prior to the Acquisition, at the same compensation and bonus level,
from the effective time of this Agreement (as set forth in its final paragraph)
through December 31, 2004.

      2. The period of consulting services under paragraph 1, immediately above,
shall expire on December 31, 2004; however, if you and a duly authorized
representative of the Company mutually agree, you may be engaged to provide
consulting services thereafter, subject to written agreement as to the terms and
conditions of such engagement.

      3. Following the conclusion of your consulting services to the Company,
and continuing for so long thereafter as you remain a member of the board of
directors of the Company, you will be entitled to receive such compensation
(cash and/or equity) as is provided by the Company to its non-management
directors.

      4. At the Closing (as defined in the Stock Purchase Agreement, itself
defined below), you agree to roll over twenty-five percent of the value of the
equity you hold in Prior Holdings (defined below) into equity of THL-Nortek
Investors, LLC and into deferred compensation rights on the same terms and
conditions as other members of management of Prior Holdings.

      . 5. The Company will provide you a service bonus in the amount of One
Million Dollars following your completion of consulting services under paragraph
1 hereof, payable on January 3, 2005. Following your completion of such
consulting

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services hereunder, the Company also will transfer ownership to you of the
automobile currently provided by the Company for your business use, which
transfer shall take effect on January 3, 2005 or as soon as reasonably
achievable thereafter. You will be responsible for all operating costs and
expenses of that automobile, effective as of the date of transfer, unless
otherwise agreed in writing at the time of transfer.

      6. You waive any and all participation in and benefits under the Nortek,
Inc. Change in Control Severance Benefit Plan for Key Employees, As Amended and
Restated June 12, 1997, (the "Plan of 2001") and its successor, the Nortek, Inc.
Second Amended and Restated Change in Control Severance Benefit Plan for Key
Employees, subject to your receiving payment in accordance with Section 4 of the
Plan of 2001 as a result of the Acquisition and subject further to your
engagement hereunder through December 31, 2004 and your receiving payment under
the first sentence of paragraph 5 of this Agreement, immediately above.

      7. For purposes of this letter agreement, "Acquisition" means the purchase
by THL Buildco Holdings, Inc. and THL Buildco, Inc. of all the outstanding
capital stock of the then-existing Nortek Holdings Inc. ("Prior Holdings")
pursuant to that certain stock purchase agreement entered into on July 15, 2004,
as amended, (the "Stock Purchase Agreement") with affiliates of Kelso & Company,
L.P. and certain other parties and the subsequent merger of THL Buildco, Inc.
with and into Prior Holdings, the merger of Prior Holdings with and into Nortek
(with Nortek continuing as the surviving corporation) and with THL Buildco
Holdings, Inc. becoming the new parent company of Nortek and being renamed
Nortek Holdings, Inc.

      If the terms of this letter accurately reflect your agreement with the
Company, please sign and return it to me immediately following the Acquisition.
If you sign and return this Agreement in a timely manner, it will take effect as
a legally-binding agreement between you and the Company on the basis set forth
above on the date of, and immediately following, the Acquisition. The enclosed
copy, which you should also sign and date, is for your records.

Sincerely,
NORTEK, INC.
NORTEK HOLDINGS, INC.

By: ___________________________
    Kevin W. Donnelly
    Vice President

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Accepted and agreed:

Signature: _______________________
           David B. Hiley

Date:___________________________<PAGE>
                                 August 25, 2004

BY HAND DELIVERY

Robert E. G. Ractliffe

Dear Bob:

      As we discussed, your employment with Nortek, Inc. and Nortek Holdings,
Inc. (together, the "Company") will end, effective as of August 26, 2004 (the
"Separation Date"). The purpose of this letter is to confirm the agreement
between you and the Company concerning your severance arrangements, as follows:

      1.    SEPARATION BENEFITS. In consideration of your acceptance of this
Agreement and subject to your meeting in full your obligations under it, the
Company will provide you the following:

            (a)   The Company shall cause those of your Class A and Class B
stock options which remain unvested on the Separation Date to vest. Further, you
agree to the cancellation of all of your Class A and Class B stock options in
return for an amount of cash equal to (i) the product of (A) the Per Share Deal
Price multiplied by (B) the number of shares of Class A Common Stock of Nortek
Holdings, Inc. subject to the cancelled options minus (ii) the aggregate
exercise prices with respect to all such options. Provided this Agreement is in
effect, payment will be made by wire transfer on August 27, 2004.

            (b)   You will remain a Participant in the Nortek, Inc. Supplemental
Executive Retirement Plan C ("SERP-C"), subject to its current terms. The
Company, however, shall cause SERP-C to be amended such that you may elect to
begin receiving benefits under SERP-C as of September 1, 2006 with no reduction
in benefits for early retirement. The terms of your participation in SERP-C
shall otherwise remain unchanged, other than as stated in Paragraph 5(e). Also,
it is understood and agreed that none of the payments to be made to you under
this Agreement or the Change of Control Plan, addressed below, shall be included
in the calculation of your benefits under SERP-C.

            (c)   The Company will pay your membership dues in the Wannamoisett
Country Club through December 31, 2004 and you may continue to use that
membership through that date. You will be responsible for all personal expenses
incurred.

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            (d)   Although you will cease to be a member in the TPC Club of
Norton, Massachusetts as of the Separation Date, the Company will designate you
as eligible to use the Company's membership for the period of one year from the
Separation Date, through August 25, 2005. You will be responsible for all
personal expenses incurred.

            (e)   The Company will provide you tax consulting services for
calendar 2004 in accordance with its policy for active executive employees.

            (f)   The Company will provide you six months of executive
outplacement services, at the Company's cost, through Right Management
Associates.

            (g)   On the Separation Date, the Company will transfer ownership to
you of the two cell phones and the computer hardware at your home which were
previously provided for your business use. You will be responsible for all costs
related to use of those phones and that equipment after the Separation Date.

      2.    FINAL PAY, EXPENSES AND CHANGE OF CONTROL PLAN PARTICIPATION. In
addition to the foregoing,

            (a)   You have received your salary for the month of August. The
Company will provide you any terminal vacation pay to which you are entitled.

            (b)   The Company will reimburse any business expenses which you
incurred on or before the Separation Date and which are subject to reimbursement
under current Company policies, provided that you submit those expenses and any
supporting documentation and substantiation required within 90 days of the
Separation Date.

            (c)   You will be entitled to the following benefits under the
Nortek, Inc. Change of Control Severance Benefit Plan for Key Employees (as
amended June 12, 1997 and November 19, 2002) (the "Change of Control Plan"), in
accordance with its terms: (i) a payment of $120,000, which is 20% of your
current salary, (ii) 24 months of payments in the amount of $122,917 per month
(based on your current base salary of $600,000 and a high bonus of $875,000) and
(iii) 24 months of continued coverage under certain designated benefit plans or,
if elected within 15 days of the Separation Date, a payment in lieu thereof, all
as specified in the Change of Control Plan.

      3.    WITHHOLDING. All payments by the Company under this Agreement will
be reduced by all taxes and other amounts that the Company is required to
withhold under applicable law.

      4.    STATUS OF BENEFITS AND ACKNOWLEDGEMENT OF FULL PAYMENT. Except as
provided in the second paragraph of Section 5 of the Change of Control Plan and
referenced in Paragraph 2(c) above, your participation in all benefit plans and
perquisites of the Company will end as of the Separation Date, in accordance
with the terms of those

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plans and perquisites. You agree that, except as expressly provided under this
Agreement, no further compensation of any kind is owed to you.

      5.    CONTINUING EMPLOYEE OBLIGATIONS.

            (a)   You agree that you will continue to protect Confidential
Information, as defined below, and will not, directly or indirectly, use or
disclose it.

            (b)   You also agree that you will not disclose this Agreement or
any of its terms or provisions, directly or by implication, except to members of
your immediate family and to your legal and tax advisors, and then only on
condition that they agree not to further disclose this Agreement or any of its
terms or provisions to others.

            (c)   In signing this Agreement, you give the Company assurance that
you will return to it, no later than September 15, 2004, any and all documents,
materials and information (whether in hardcopy, on electronic media or
otherwise) related to the business (whether present or otherwise) of the Company
and its Affiliates, and all copies, and all keys, credit cards and all other
property of the Company in your possession or control, excluding only that
equipment transferred to you under Paragraph 1(g).

            (d)   You agree to cooperate with the Company hereafter with respect
to all matters arising during or related to your employment, including but not
limited to all matters in connection with any governmental investigation,
litigation or regulatory or other proceeding which may have arisen or which may
arise following the signing of this Agreement. The Company will reimburse all
reasonable and necessary out-of-pocket expenses incurred in complying with
Company requests hereunder. Following the conclusion of the 24 months of
payments to be provided you under the Change in Control Plan, the Company will
reimburse, on a per diem basis, any salary, in excess of ten days' salary in any
calendar year, which you must forego in order to comply with Company requests
thereafter, provided that the Company has approved the time expenditure in
advance.

            (e)   You acknowledge that during your employment you have had
access to Confidential Information which, if disclosed, would assist in
competition against the Company and its Affiliates and that you have also
generated goodwill for the Company and its Affiliates in the course of your
employment. Therefore, you agree that the following restrictions on your
activities after your employment are necessary to protect the goodwill,
Confidential Information and other legitimate interests of the Company and its
Affiliates and the Company agrees that your meeting the following obligations
will satisfy as well your obligations with respect to non-competition under
SERP-C:

                  (i)   You agree that, during the four-year period immediately
following termination of your employment (the "Non-Competition Period"), you
will not, directly or indirectly, whether as owner, partner, investor,
consultant, agent, employee, co-venturer or otherwise, compete in North America
with the Company or any of its Affiliates

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in any business in which any of them was engaged or actively planning to engage
on the Separation Date. Specifically, but without limiting the foregoing, you
agree not to work or provide services, in any capacity, whether as an employee,
independent contractor or otherwise, whether with or without compensation, to
any Person that is engaged in North America in any business that is competitive
with the business of the Company or its Affiliates, as conducted or in planning
during your employment with the Company or any of its Affiliates.

                  (ii)  You agree that, during the Non-Competition Period, you
will not, and will not assist any other Person knowingly to, (A) hire any
employee of the Company or any of its Affiliates or seek to persuade any
employee of the Company or any of its Affiliates to discontinue employment, (B)
solicit or encourage any customer of the Company or any of its Affiliates or
independent contractor providing services to the Company or any of its
Affiliates to terminate or diminish its relationship with them or (C) seek to
persuade any customer or prospective customer of the Company or any of its
Affiliates to conduct with anyone else any business or activity that such
customer or prospective customer conducts or could conduct with the Company or
any of its Affiliates.

            (f)   In signing this Agreement, you give the Company assurance that
you have carefully read and considered all the terms and conditions of this
Agreement, including the restraints imposed on you under Paragraph 5(a) and
Paragraph 5(e) hereof. You agree without reservation that these restraints are
necessary for the reasonable and proper protection of the Company and its
Affiliates and that each and every one of the restraints is reasonable in
respect to subject matter, length of time and geographic area. You further agree
that, were you to breach any of the covenants contained in Paragraph 5(a) or
Paragraph 5(e), the damage to the Company and its Affiliates would be
irreparable. You therefore agree that the Company, in addition to any other
remedies available to it, shall be entitled to preliminary and permanent
injunctive relief against any breach or threatened breach by you of any of those
covenants, without having to post bond. You and the Company further agree that,
in the event that any provision of Paragraph 5(a) or Paragraph 5(e) is
determined by any court of competent jurisdiction to be unenforceable by reason
of its being extended over too great a time, too large a geographic area or too
great a range of activities, that provision shall be deemed to be modified to
permit its enforcement to the maximum extent permitted by law.

      6.    DEFINITIONS. As used in this Agreement,

            (a)   "Affiliates" means all persons and entities directly or
indirectly controlling, controlled by or under common control with either or
both of Nortek, Inc. and Nortek Holdings, Inc., where control may be by
management authority or equity interest.

            (b)   "Confidential Information" means any and all information of
the Company and its Affiliates, that is not generally known to others with whom
any of them competes or does business or with whom any of them plans to compete
or do business. Confidential Information includes without limitation such
information relating to (i) the

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development, research, testing, manufacturing, marketing and financial
activities of the Company and its Affiliates, (ii) their products and services,
(iii) the costs, sources of supply, financial performance and strategic plans of
the Company and its Affiliates, (iv) the identity and special needs of the
customers and prospective customers of the Company and its Affiliates and (v)
the people and organizations with whom the Company and its Affiliates have
business relationships and those relationships. Confidential Information also
includes any information that the Company or any of its Affiliates has received,
or may receive hereafter, belonging to customers or others with any
understanding, express or implied, that the information would not be disclosed.
Confidential Information does not include information that enters the public
domain, other than through a breach by you or another Person of an obligation of
confidentiality to the Company or any of its Affiliates.

            (c)   Per Share Deal Price has the meaning ascribed to that term in
the Stock Purchase Agreement (the "Stock Purchase Agreement") by and among Kelso
Investment Associates VI, L.P. (among other sellers named therein), THL Buildco
Holdings, Inc., and THL Buildco, Inc., dated as of July 15, 2004, as expected to
be amended in connection with the closing of the Sale (as defined in the Stock
Purchase Agreement).

            (d)   "Person" means an individual, a corporation, a limited
liability company, an association, a partnership, an estate, a trust or any
other entity or organization, other than the Company or any of its Affiliates.

      7.    RELEASE OF CLAIMS. In exchange for the benefits provided you under
Paragraph 1 of this Agreement, to which, you acknowledge, you would not
otherwise be entitled, you agree that this Agreement shall be in complete and
final settlement of any and all causes of action, rights or claims that you have
had in the past, now have, or might now have, in any way related to, connected
with or arising out of your employment or its termination or pursuant to any
federal, state or local law, regulation or other requirement and you hereby
release and forever discharge the Company and its Affiliates and all of their
respective past and present directors, shareholders, officers, members,
managers, general and limited partners, employees, agents and representatives,
their successors and assigns, and all others connected with any of the
foregoing, both individually and in their official capacities, from any and all
such causes of action, rights or claims and you represent and warrant that, as
of the date of your signing of this Agreement, you have no knowledge of any
facts or circumstances that could give rise to a cause of action, right or claim
by you against the Company or any of its Affiliates. Excluded from the scope of
this release of claims are any rights of indemnification or contribution that
you have under the articles of incorporation, by-laws or LLC agreement of the
Company or any of its Affiliates. Also excluded from the scope of this release
of claims are your vested benefits, if any, under all benefit plans of the
Company qualified under Section 401(a) of the Internal Code of 1986, as amended,
in accordance with the terms of those plans; provided however, that none of the
payments to be made to you under this Agreement or the Change of Control Plan
shall be included in the calculation of your benefits under those plans.

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      8.    MISCELLANEOUS. This letter contains the entire agreement between you
and the Company and replaces all prior and contemporaneous agreements,
communications and understandings, whether written or oral, with respect to your
employment and its termination and all related matters, excluding only the
Change in Control Plan and SERP-C, as amended hereby, and any loan to you from
the Company or any benefit plan outstanding on the Separation Date. This
Agreement may not be modified or amended, and no breach shall be deemed to be
waived, unless agreed to in writing by you and the Chairman and CEO of the
Company or his expressly authorized designee. The captions and headings in this
Agreement are for convenience only and in no way define or describe the scope or
content of any provision of this Agreement. The obligation of the Company to
provide you the benefits set forth in this Agreement is expressly conditioned
upon your continued full performance of your obligations under this Agreement
and SERP-C, as amended hereby. It is agreed that you may not assign your rights
or obligations hereunder, but that Nortek and Nortek Holdings, in the event that
either shall hereafter reorganize, consolidate with, or merge into, any other
entity or transfer all or substantially all of its properties or assets to
another entity, may assign its rights and obligations under this Agreement to
such entity without your consent.

      9.    EMPLOYEE ASSURANCES. In signing this Agreement, you give the Company
assurance that you have signed it voluntarily and with a full understanding of
its terms; that you have had a full and sufficient opportunity to consider this
Agreement and to consult with any of those listed in Paragraph 5(b) above before
signing it; and that, in signing this Agreement, you have not relied on any
promises or representations, express or implied, that are not set forth
expressly in this Agreement.

      If the terms of this Agreement are acceptable to you, please sign, date
and return it to me. At the time you sign and return this letter, it will take
effect as a legally-binding agreement between you and the Company on the basis
set forth above. The enclosed copy of this letter, which you should also sign
and date, is for your records.

                                        Sincerely,

                                        Richard L. Bready
                                        Chairman and CEO

Accepted and agreed:

Signature:  ____________________________
                  Robert E. G. Ractliffe

Date:  ________________________________

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