Exhibit 10.2
SEPARATION, CONSULTING AND NON-COMPETITION AGREEMENT
This SEPARATION AND CONSULTING
AGREEMENT (the “Agreement”) is made and entered
into on the 9th day of May, 2008, by and between GREAT WOLF
RESORTS, INC., a Delaware corporation (the
“Company”), and JOHN EMERY (the
“Executive”).
RECITALS:
WHEREAS, the Company and the
Executive are parties to an Employment Agreement dated December 13,
2004 (the “Employment Agreement”); and
WHEREAS, the Executive hereby
tenders his resignation as an officer, director and employee of the
Company, and the Company hereby accepts such resignation effective
as of the date specified herein; and
WHEREAS, the Company and the
Executive desire to memorialize the terms of the Executive’s
termination of employment in this Agreement and completely resolve
all matters arising out of the Executive’s employment with
the Company or the termination of that employment, as well as all
matters arising out of or related to the Employment
Agreement.
NOW, THEREFORE, in
consideration of the premises and mutual covenants contained
herein, and intending to be legally bound hereby, the parties
hereto agree as follows:
1. Termination of the
Employment Agreement; Resignation as an Officer and Director and
Termination of Employment . The Executive and the Company
hereby mutually terminate, revoke and rescind the Employment
Agreement and all rights and obligations either party has or may be
entitled to under the Employment Agreement. The Executive and the
Company agree further that the Executive’s status as an
officer, director and employee of the Company terminates as of the
date specified herein.
2. Consulting Services
and Ongoing Cooperation . The Executive agrees to use his
best efforts to assist, advise and cooperate with the Company if
the Company so requests on issues that arose or were in any way
developing during his employment with the Company, subject to
Executive’s availability given his employment obligations, if
any, at that time. For a period of sixty (60) days, the Executive
shall furnish such assistance, advice or cooperation to the Company
as the Company shall reasonably request and as is within the
Executive’s reasonable capability. Such assistance, advice
and cooperation may include, but shall not be limited to the
preparation for, or the conduct of, any litigation, investigation
or proceeding involving matters or events which occurred during the
Executive’s employment by the Company as to which the
Executive’s knowledge or testimony may be important to the
Company. In connection with the preparation for, or the conduct of
such litigation, investigation or proceeding as described in the
preceding sentence, the Executive shall promptly provide the
Company with any records or other materials in his possession that
the Company shall request in connection with the defense or
prosecution of such litigation, investigation or proceeding. If and
to the extent that the Company requests that the Executive attend a
meeting, deposition or trial, the
Company
shall compensate Executive for his time at the rate of $750 per day
or portion thereof during which Executive complies with such
request. The Company shall also pay or reimburse the Executive for
his travel expenses reasonably incurred in the course of providing
such cooperation. The Company shall make such payment or
reimbursement within thirty (30) days of receipt of reasonable
substantiating documentation from the Executive but in no event
later than the end of the calendar year following the year in which
such expenses were incurred.
3. Covenants as to
Confidential Information, Competitive Conduct and
Solicitation . The Executive hereby acknowledges and agrees
as follows: (a) this Section 3 is necessary for the
protection of the legitimate business interests of the Company,
(b) the restrictions contained in this Section 3 with
regard to geographical scope, length of term and types of
restricted activities are reasonable; (c) the Executive has
received adequate and valuable consideration for entering into this
Agreement, and (d) the Executive’s expertise and
capabilities are such that his obligations hereunder and the
enforcement hereof by injunction or otherwise will not adversely
affect the Executive’s ability to earn a livelihood.
a.
Confidentiality Information . The Executive agrees
that the Executive will not, directly or indirectly, without the
express written approval of the Company, unless directed by
applicable legal authority (including any court of competent
jurisdiction, governmental agency having supervisory authority over
the business of the Company or its subsidiaries, or any legislative
or administrative body having supervisory authority over the
business of the Company or its subsidiaries) having jurisdiction
over the Executive, disclose to or use, or knowingly permit to be
so disclosed or used, for the benefit of himself, any person,
corporation or other entity other than the Company, (i) any
non-public information concerning any financial matters, customer
relationships, competitive status, supplier matters, internal
organizational matters, current or future plans, or other business
affairs of or relating to the Company, its subsidiaries or
affiliated or related parties, (ii) any proprietary
management, operational, trade, technical or other secrets or any
other proprietary information or other data of the Company, its
subsidiaries or affiliated or related parties, or (iii) any
other information related to the Company, its subsidiaries or
affiliated or related parties, or which the Executive should
reasonably believe will be damaging to the Company, its
subsidiaries or affiliated or related parties, which has not been
published and is not generally known outside of the Company. The
Executive acknowledges that all of the foregoing constitutes
confidential and proprietary information, which is the exclusive
property of the Company.
b.
Restrictive Period . The term
“Restricted Period” for purposes of this Agreement
shall mean the one-year period following the date of this
Agreement.
c.
Nonsolicitation of Customers and Employees .
i.
Customers . The Executive, during the
Restricted Period, shall not, on the Executive’s own behalf
or on behalf of any person, firm partnership, association,
corporation or business organization, entity or enterprise, call on
or solicit for the purpose of competing with the Company or its
affiliates any customers of the Company or its affiliates with whom
the Executive had contact, knowledge, or association at any time
during the twelve (12) month period immediately preceding the
beginning of the Restricted Period.
2
ii.
Employees . The Executive, during the
Restricted Period, shall not, either directly or indirectly, call
on, solicit or attempt to induce any other officer, employee or
independent contractor of the Company or its affiliates with whom
the Executive had contact, knowledge of, or association at any time
during the twelve (12) month period immediately preceding the
beginning of the Restricted Period, to terminate his or her
employment or business relationship with the Company or its
affiliates and shall not assist any other person or entity in such
a solicitation.
d.
Non-Compete . The Executive and the Company
agree that (a) the Company is engaged in the family
entertainment resort business featuring indoor waterparks, which
shall be referred to as the “Business,” (b) the
Business can be conducted anywhere, (c) the Business can be
and is available to any person or entity with access to sufficient
capital, (d) the Business consequently has no geographic
boundary or limitation, (e) the Executive was intimately
involved in the Business wherever it operates, and (f) this
Section 3(d) is intended to provide fair and reasonable protection
to the Company in light of the unique circumstances of the
Business. The Executive therefore agrees that the Executive shall
not, for the one (1) year period which starts on the date of
this Agreement, compete with the Company within fifty
(50) miles of a location where the Company conducts its
Business or is planning to conduct its Business; provided, however,
the Executive may own up to five percent (5%) of the stock of a
publicly traded company that engages in such competitive business
so long as the Executive is only a passive investor and is not
actively involved in the company in any way.
e.
Remedy for Breach . The Executive agrees that
the remedies at law of the Company for any actual or threatened
breach by Executive of the covenants in this Section 3 would
be inadequate and that the Company shall be entitled to specific
performance of the covenants in this Section 3, including
entry of an ex parte, temporary restraining order in state or
federal court, preliminary and permanent injunctive relief against
activities in violation of this Section 3, or both, or other
appropriate judicial remedy, writ or order, in addition to any
damages and legal expenses which the Company may be legally
entitled to recover. The Executive acknowledges and agrees that the
covenants in this Section 3 shall be construed as agreements
independent of any other provision of this or any other agreement
between the Company and the Executive, and that the existence of
any claim or cause of action by the Executive against the Company,
whether predicated upon this Agreement or any other agreement,
shall not constitute a defense to the enforcement by the Company of
such covenants.
4. Consideration
.
a. In
consideration of the execution and performance of this Agreement by
the Executive, and subject to the remaining provisions of this
Section 4, the Executive will receive from the Company the
following severance payments and benefits. The Company shall pay to
the Executive cash totaling $825,000, payable in a lump sum within
five days of expiration of the 7-day revocation period referred to
in Section 6 hereof.
3
b. All
payments under this Section 4 shall be subject to applicable
deductions. For the purposes of this Agreement, “applicable
deductions” shall include, but shall not be limited to, any
federal, state, or local taxes determined by the Company to be
required to be withheld from amounts paid to the Executive pursuant
to this Agreement or otherwise due from the Company, and any other
amounts that the Company may be legally required to deduct from his
earnings.
c. Any
date specified as a payment date under this Section 4 shall be
construed as meaning any date on or about the specified date;
provided, however, that the Company shall make payment as soon as
practicable after the specified date without, to the extent
possible, incurring any tax penalties on either the Executive or
the Company.
d.
Except as provided in this Agreement, the Executive agrees that he
is not entitled to any other compensation (including, but not
limited to, salary or bonuses), perquisites, or benefits of any
kind or description from the Company, or from or under any employee
benefit plan or fringe benefit plan sponsored by the Company or
under the Employment Agreement, other than as described above and
other than his regular salary through the Effective Date, as
defined in Section 6(f). The consideration paid by the Company
to the Executive pursuant to this Agreement shall be in compromise,
settlement and full satisfaction of any and all Claims, as defined
in Section 5 of this Agreement, that the Executive has, or may
have, against the Company or other Releasees, as defined in
Section 5 of this Agreement, arising out of the
Executive’s employment with the Company or its affiliates,
the termination of such employment and any and all matters related
to the Executive’s employment and termination, or to his
Employment Agreement.
5. Mutual Release
.
a. The
Executive, for himself, his heirs, successors and assigns and in
consideration of the payments to be made by or on behalf of the
Company pursuant to Section 4 of this Agreement, does hereby
forever discharge and release the Company, any subsidiaries,
affiliated companies, companies with common management, ownership
or control, successors, assigns, insurers and
|
