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EMPLOYMENT AGREEMENT

Employment Agreement

EMPLOYMENT AGREEMENT | Document Parties: Central Garden & Pet Company You are currently viewing:
This Employment Agreement involves

Central Garden & Pet Company

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Title: EMPLOYMENT AGREEMENT
Date: 5/7/2009
Industry: Chemical Manufacturing     Law Firm: Paul Hastings     Sector: Basic Materials

EMPLOYMENT AGREEMENT, Parties: central garden & pet company
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Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the “Agreement”), made this 14 th day of January, 2009 is entered into by Central Garden & Pet Company and/or any of its wholly owned subsidiaries, successors and assigns (collectively called “the Company”) and Glen R. Fleischer (“Executive”).

WHEREAS, the Company desires to employ Executive and Executive desires to become employed by the Company;

THEREFORE, in consideration of the mutual covenants and promises contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. Effective Date: This Agreement shall become effective on January 14, 2009, (“Effective Date”).

2. Term of Employment : Executive will be employed by the Company for an indefinite term, subject to termination as set forth below.

3. Position: Executive shall serve as President Pet Products Division. He shall perform those duties and responsibilities consistent with such position that are assigned to him by the Chief Executive Officer of the Company. Executive’s position and related terms and conditions of employment may from time to time be modified by the Company in its discretion. .

4. Full Time Performance of Duties: During the Term of Employment, except for periods of absence occasioned by illness, reasonable vacation periods, and reasonable leaves of absence, Executive agrees to devote substantially all his business time, attention, skill, and efforts to the faithful and loyal performance of his duties under this Agreement and shall not during his employment with the Company engage in any other business activities, duties or pursuits, render any services of a business, commercial, or professional nature to any other person or organization, whether for compensation or otherwise, without the prior written consent of Company. However, the expenditure of reasonable amounts of time for educational, charitable, or professional activities for which Executive will not receive additional compensation from the Company, shall not be considered a breach of this Agreement if those activities do not materially interfere with the services required of Executive under this Agreement.

5. Salary: The Company will pay Executive an annualized base salary of $ 415,000 in accordance with the Company’s payroll practices for executives. Executive will be eligible for periodic salary reviews consistent with the Company’s salary review practices for executives.

6. Bonus: Executive will be eligible for a bonus each year during the Term of Employment with a target amount of fifty percent (50%) of Executive’s base salary in effect at the beginning of the year in question, to be awarded upon attainment of the annual operating goals and the personal goals established by the Chief Executive Officer. The award and amount of any such bonus shall be in the discretion of the Company.

 

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7. Options: Executive will be granted a non-qualified Performance Based Stock Option to purchase fifty thousand (50,000) shares of Company Common Stock (CENT A) with price determined by the “fair market value” upon the date of issue. These options shall vest over a four (4) year period at a rate of twenty-five percent (25%) per year with the first traunch vesting on March 4, 2010. The options shall expire on March 4, 2014. The right to exercise the options shall be consistent with the terms of the Central Garden & Pet Company 2003 Omnibus Equity Incentive Plan.

8. Restricted Stock: The Executive will receive fifty thousand (50,000) restricted shares of Central Garden & Pet Company Stock (CENT A) on the Effective Date of this Agreement. These shares shall vest at the rate of 25% per year beginning at the end of year three (3) and being fully vested at the end of year six (6).

9. Benefits: Subject to all applicable eligibility requirements Executive will participate in any and all 401(k), medical, dental, life and long-term disability insurance and/or other benefit plan which, from time to time, may be established as generally applicable to other similarly situated Company executives.

10. Vacation: Executive will earn four (4) weeks vacation annually. Executive’s maximum vacation accrual will be six (6) weeks. Once Executive has accrued six (6) weeks vacation, he will stop earning vacation until he has taken vacation and reduced his accrual below six (6) weeks.

11. Automobile: During the Term of Employment, the Company will provide Executive with a monthly automobile allowance of $1000.00.

12. Reimbursement of Expenses: The Company will reimburse Executive for all reasonable travel, entertainment and other expenses incurred or paid by the Executive in connection with, or related to, the performance of his duties, responsibilities or services under this Agreement in accordance with the Company’s policies, upon presentation by Executive of documentation, expense statements, vouchers and/or other supporting information as the Company may request. In no event shall reimbursements be made for expenses incurred by Executive after the end of the calendar year following the calendar year in which Executive incurs the expense.

13. Incapacity: In the event that Executive becomes physically or mentally disabled or incapacitated such that it is the reasonable, good faith opinion of the Company that Executive is unable to perform the services required under this Agreement with or without reasonable accommodation, then after four (4) months of continuous physical or mental disability, this Agreement will terminate; provided , however , that during this four (4) month period, Executive shall be entitled to the continuation of his compensation as provided by this Agreement; however such continued payments by the Company shall be integrated with any disability, workers’ compensation, or other insurance payments received, such that the total amount does not exceed the compensation as provided by this Agreement. For purposes of this Agreement, physical or mental disability does not include any disability arising from current use of alcohol, drugs or related issues.

 

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14. Termination by the Company For Cause: The Company may terminate Executive for cause. If Executive is terminated for cause, he will receive only his compensation earned pro rata to the date of his termination. All other benefits will cease on the date of Executive’s termination. Cause shall be defined as:

 

 

(a)

An act or omission constituting negligence or misconduct which is materially injurious to the Company;

 

 

(b)

Failure to comply with the lawful directives of the Board of Directors;

 

 

(c)

A material breach of this Agreement by Executive, which is not cured within thirty (30) days after written notice thereof;

 

 

(d)

Failure to perform in a manner acceptable to the Company after written notice and an opportunity to cure;

 

 

(e)

The abuse of alcohol or drugs;

 

 

(f)

Fraud, theft or embezzlement of Company assets, criminal conduct or any other act of moral turpitude by which is materially injurious to the Company;

 

 

(g)

A material violation of any securities law, regulation or compliance policy of the Company;

 

 

(h)

Executive’s death or incapacity exceeding four (4) months as provided in Section 13 above.

15. Termination By Executive For Cause: Termination By Executive For Cause: Executive may also terminate this Agreement for cause by giving thirty (30) days written notice to the Company’s Vice President of Human Resources of an alleged material breach of this Agreement by the Company, provided such breach is not cured by the Company within the thirty (30) day notice period. If Executive terminates his employment under this section, he will be entitled to the same severance as if he were terminated by the Company without cause as provided in Section 16, below. Such payments shall be Executive’s sole and exclusive remedy in the event of a termination of this Agreement by Executive for cause.

16. Termination By The Company Without Cause: The Company may terminate Executive’s employment under this Agreement at any time without cause by giving Executive thirty (30) days written notice of termination. If the Company terminates Executive under this section, within 10 days after Executive signs a general release of claims in a form acceptable to the Company that becomes irrevocable, provided a later payment is not required by Section 17 below, the Company will pay Executive a severance consisting of a continuation of Executive’s base salary for a nine (9) month period, subject to applicable payroll deductions, and health

 

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insurance continuation for nine (9) months. Executive will be provided, at most, sixty (60) days to consider whether to sign such release. Such payments shall cease, and no further severance obligation will be owed, in the event Executive obtains other equivalent employment during the severance period. Such severance payments shall be Executive’s sole and exclusive remedy in the event of a termination of this Agreement by the Company without cause. At its option, the Company may pay Executive thirty (30) days additional salary and benefits provided in this Agreement in lieu of giving Executive the thirty (30) days notice as provided above.

17. Section 409A Delay: Effective January 1, 2009 each payment hereunder subject to Section 409A will be considered a separate payment for purposes of Section 409A. To the extent that it is determined by the Company in good faith that all or a portion of any payments hereunder subject to Section 409A made in connection with Executive’s separation from service are not exempt from Section 409A and that Executive is a “specified employee” (within the meaning of Section 409A) at the time of his separation from service, then payment of such non-exempt payments shall not be made until the date that is six (6) months and one day after his separation from service (or, if earlier, his death), with any payments that are required to be delayed being accumulated during the six-month period and paid in a lump sum on the date that is six (6) months and one day following his separation from service and any subsequent payments, if any, being paid in accordance with the dates and terms set forth herein.

18. Termination by Executive Without Cause: Executive may terminate his employment without cause by giving the Company thirty (30) days written notice of termination. If Executive terminates his employment without cause under this section, he will receive only his salary and benefits earned pro rata to the date of his termination. All other salary and benefits will cease on the date of Executive’s termination. At its option, the Company may pay Executive his salary and benefits provided in this Agreement through the effective date of his written notice of termination and immediately accept his termination.

19. Confidential Business Information: The Company has and will continue to spend significant time, effort and money to develop proprietary information which is vital to the Company’s business. During Executive’s employment with the Company, Executive has and will have access to the Company’s confidential, proprietary and trade secret information including but not limited to information and strategy relating to the Company’s products and services including customer lists and files, product description and pricing, information and strategy regarding profits, costs, marketing, purchasing, sales, customers, suppliers, contract terms, employees, salaries; product development plans; business, acquisition and financial plans and forecasts and marketing and sales plans and forecasts (collectively called “Company Confidential Information”). Executive will not, during his employment with the Company or thereafter, directly or indirectly disclose to any other person or entity, or use for Executive’s own benefit or for the benefit of others besides the Company, any Company Confidential Information. Upon termination of this Agreement, Executive agrees to promptly return all Company Confidential Information.

 

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20. Non-Solicitation of Employees: While Executive is employed by the Company and for twelve (12) months after such employment terminates, Executive will not (acting either directly or indirectly, or through any other person, firm, or corporation) induce or attempt to induce or influence any employee of the Company to terminate employment with the Company when the Company desires to retain that person’s services.

21. Duty of Loyalty: During term of this Agreement and any post-employment consulting agreement, Executive agrees that he will not, nor will he permit any entity or other person under his control, to directly or indirectly hold, manage operate or control, or participate in the ownership, management, operation or control of, or render executive, managerial, market research, advice or consulting services, either directly or indirectly, to any business engaged in or about to be engaged in developing, producing, marketing, distributing or selling lawn, garden, animal health, nutrition or pet related products.

22. Separability: Each provision of this Agreement is separable and independent of the other provisions. If any part of this Agreement is found to be invalid, the remainder shall be given full force and effect as permitted by law.

23. Complete Agreement: This Agreement constitutes the entire agreement between Executive and the Company regarding the subjects covered by this Agreement. No other agreement, understanding, statement or promise other than those contained in this Agreement is part of their employment agreement or will be effective. Any modification of this Agreement will be effective only if it is in writing and signed by the Chief Executive Officer of the Company.

24. Notice: All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given (except as may otherwise be specifically provided herein to the contrary) if delivered by hand and receipted for by the party to whom said notice or other communication shall have been directed or mailed by certified or registered mail with postage prepaid:

 

(a)    If to the Company to:

 

Central Garden & Pet Company

 

1340 Treat Blvd., Suite 600

 

Walnut Creek, CA 94597

 

Attention: William E. Brown, Chairman/CEO

         with a copy to:

 

Paul Hastings Janofsky & Walker LLP

 

55 Second Street, 24th Floor

 

San Francisco, CA 94105

 

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