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EXHIBIT 10.10(b)
November 3, 2000
Mr. James O'Leary
Executive Vice President
U. S. Industries, Inc.
101 Wood Avenue South
Iselin, NJ 08830-0169
Dear Jim:
As you know, the U. S. Industries, Inc. ("USI") Board of Directors (the
"Board") has approved the spinoff of USI's Lighting Corporation of America
business segment and the Spear & Jackson group (the "Spinoff"), with you as a
senior executive of the Spinoff's parent company, LCA Group Inc. ("LCA").
Consequently, you shall cease employment with USI effective on the Spinoff
and commence employment with LCA.
Simultaneous with the execution of this letter (the "Letter Agreement"), you and
LCA will have entered into an employment agreement with regard to your future
employment with LCA (the "LCA Employment Agreement"). The LCA Employment
Agreement becomes effective upon the Spinoff, provided you are employed by USI
immediately prior to the Spinoff. Pending the Spinoff, your current employment
agreement with USI (the "USI Employment Agreement") remains in full force and
effect, including but not limited to the mutual rights of termination
thereunder.
This Letter Agreement will confirm your agreement that upon the Spinoff, your
USI Employment Agreement shall terminate and be of no further force and effect,
except for any rights with regard to indemnification as it relates to the period
prior to the Spinoff. USI reserves the right to delay or abandon the Spinoff at
any time with no obligations to you, other than any rights you have under your
USI Employment Agreement. Accordingly, if the Spinoff does not occur prior to
January 31, 2001, your USI Employment Agreement shall continue in effect and
this Letter Agreement shall be null and void.
To induce you to enter into the LCA Employment Agreement, surrender any
entitlements under your USI Employment Agreement due to your termination of
employment by USI upon the Spinoff, and execute a release of USI and related
parties (the "Release"), the Compensation Committee of the Board has taken
certain steps with regard to specific USI equity awards conditioned upon the
completion of the Spinoff, the execution of the Release at that time, and your
simultaneous execution of this Letter Agreement and the LCA Employment
Agreement, and the future grant of LCA equity awards effective on the Spinoff,
as detailed below:
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Mr. James O'Leary
U.S. Industries, Inc.
Iselin, NJ 08830-0169
Page Two
1. The stock options granted to you by USI on September 1, 1999, February 11,
2000 and May 3, 2000 will fully vest upon the consummation of the Spinoff,
and these options along with all other vested options as of the Spinoff with
an exercise price equal or below $16.125, will remain exercisable until the
second annual anniversary of the Spinoff; and
2. Your restricted stock previously awarded to you by USI will fully vest on the
90th day following the Spinoff provided you have not voluntarily terminated
your employment with LCA; and
3. Effective on the Spinoff, grant you 95,000 options at market value pursuant
to The LCA Stock Incentive Plan, with vesting to occur at the rate of 25% per
year of employment, with full vesting on the fourth anniversary of the
Spinoff, or a change-in-control of LCA, if earlier, as further detailed and
expanded in the grant; and
4. Effective on the Spinoff, award you 90,000 shares of LCA restricted stock
pursuant to the LCA plan which will provide for vesting to occur at the end
of the seventh anniversary of the Spinoff, or a change-in-control of LCA, if
earlier, as further detailed and expanded in the grant.
Attached is a summary of the current status of your USI options and restricted
stock (without effect of the Spinoff inducements above) under the USI stock
programs, for your reference. Note that other than those options referred to in
(1) above, all other vested USI options as of the Spinoff will remain
exercisable for 90 days in accordance with the terms of the applicable plan.
All other USI employment-related benefits, compensation or other entitlements
provided to you prior to the Spinoff (e.g., pension, 401(k), LTIP, car policy,
etc.) will be assumed by LCA effective on the Spinoff.
Enclosed are the Release, two copies of your LCA Employment Agreement and a
second copy of this Letter Agreement for your execution. Please review these
documents carefully, especially the language in the Release which also provides
for a time-restricted rescission period. Although these documents should remain
strictly confidential (except for legal counsel), USI must advise you of the
right to consult counsel regarding the waiving of your rights pursuant to the
Release. Please acknowledge your concurrence with this Letter Agreement, execute
both copies of the LCA Employment Agreement (one copy will be returned to you
after execution by LCA) and return all three documents to Dorothy Sander. The
Release should be executed on the day prior to the Spinoff and given to Dorothy
at that time.
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Mr. James O'Leary
U.S. Industries, Inc.
Iselin, NJ 08830-0169
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Should you have any questions regarding any of these matters, please feel free
to call either Dorothy or me.
Regards,
David H. Clarke
Chairman and Chief Executive
Agreed:
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James O'Leary Date
