Exhibit 10.3
AGREEMENT
between
XXXXXXXX'X HOLDINGS, INC.
and
XXXXXX XXXXX
Dated as of January 1, 2001
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TABLE OF CONTENTS
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1. Definitions..................................................................................................1
2. Term of Employment...........................................................................................2
3. Duties of Executive..........................................................................................3
4. Base Salary..................................................................................................3
5. Performance Cash Bonuses.....................................................................................3
6. Profit Sharing...............................................................................................4
7. Automobile, Etc..............................................................................................4
8. Life Insurance...............................................................................................4
9. Medical Insurance............................................................................................4
10. Disability Insurance.........................................................................................5
11. Tax Returns..................................................................................................5
12. Discount on Purchases; Expenses..............................................................................5
13. Vacation.....................................................................................................5
14. Other Benefits...............................................................................................5
15. Stock Options................................................................................................6
16. Termination of Employment....................................................................................6
17. Mitigation By Executive......................................................................................7
18. Noncompetition...............................................................................................8
19. Indemnification..............................................................................................9
20. Confidentiality..............................................................................................9
21. Severability.................................................................................................9
22. Enforcement.................................................................................................10
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23. Withholding.................................................................................................10
24. Entire Agreement............................................................................................10
25. Governing Law...............................................................................................10
26. Miscellaneous...............................................................................................10
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THIS EMPLOYMENT AGREEMENT ("Agreement") made and entered into
as of January 1, 2001, by and among XXXXXXXX'X HOLDINGS, INC., a Delaware
corporation (the "Company"), and XXXXXX XXXXX, residing at Xxx Xxxxxxx Xxxx,
Xxxx Xxx, Xxx Xxxxxx 00000, herein called the "Executive,"
W I T N E S S E T H:
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WHEREAS, Executive and Xxxxxxxx'x, Inc, a subsidiary of the
Company ("Xxxxxxxx'x"), are parties to a certain Employment Agreement, dated as
of February 27, 1998, and amended on February 1, 1999 and August, 2000.
WHEREAS, Xxxxxxxx'x, through the Company, wishes to continue
to employ Executive and to terminate its existing employment agreement with
Executive.
NOW, THEREFORE, in consideration of the mutual covenants,
conditions and promises contained herein, the Company desires to employ
Executive, and Executive desires to be so employed and to render such services
to the Company, all upon the terms and subject to the conditions contained
herein.
1. Definitions. As used herein,
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"Actively Traded" means listed on the New York Stock Exchange,
the American Stock Exchange or constituting a National Market System security
quoted by the National Association of Securities Dealers Automated Quotation
market system;
"Board of Directors" means the board of directors of the
Company;
"Business" has the meaning ascribed to that term in Section 18
hereof;
"Cause" means (i) the willful failure (other than any failure
resulting from the Executive's incapacity due to physical or mental illness) of
the Executive to substantially perform his normal duties with the Company under
this Agreement in any material respect, where such failure is not reasonably
corrected within 30 days after receipt of notice from the Board of Directors
specifying such failure or failures of the Executive, (ii) the willful engaging
by the Executive in conduct which is materially injurious to the Company or any
of its Subsidiaries (but any act or failure to act which gives rise to a right
of termination under both this clause (ii) and clause (i)above shall be treated
as if such right arose under clause (i)) or (iii)the conviction of the Executive
of any crime or offense constituting a felony;
"Common Share" means a share of Common Stock of the Company,
par value $.01 per share;
"EBITDA" has the meaning ascribed to that term in Exhibit A
hereof, and shall be calculated by the Company's independent accountants in
accordance with generally accepted accounting principles as in effect at the
time of calculation and consistent with the calculation for prior Fiscal Years
(without regard to any accounting principles which may be applicable in, or
result from, proceedings under Chapter 11 of the United States Bankruptcy Code);
"Financing" has the meaning ascribed to that term in Section
18 hereof;
"Fiscal Year" means the 12 month period ending on the Saturday
immediately preceding January 31, or such other annual fiscal accounting period
of the Company as may be adopted by the Company from time to time;
"Good Reason" means (i) a material adverse alteration in the
nature or status of the Executive's position, duties or responsibilities from
those in effect as of the inception of the Term; (ii) a reduction in or failure
to pay or provide when due any of the compensation (it being understood that
base salary cannot be reduced under this Agreement) or other benefits required
to be paid or provided to the Executive hereunder, if, but only if, such
reduction or failure continues for 10 days following written notice from the
Executive specifying the nature of the reduction or failure; (iii) a change in
the principal place of the Executive's employment to a location more than 100
miles from the place of the Executive's principal residence as of the date of
this Agreement, excluding required travel relating to the Company's business; or
(iv) any other failure of the Company to fulfill its obligations under this
Agreement in any material respect;
"Group" means a syndicate or group deemed a "person" within
the meaning of Rule 13d-5 promulgated by the Securities and Exchange Commission;
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or any agency or instrumentality thereof;;
"Store" has the meaning ascribed to that term in Section 18
hereof;
"Subsidiary" means any entity of which securities or other
ownership interests having ordinary voting power to elect a majority of the
board of directors or other Persons performing similar functions are directly or
indirectly owned by the Company;
"Total Disability" or "Totally Disabled" means the disability,
within the meaning of the Company's short-term disability plan, for a continuous
period of 100 days, or for any 100 days within a 365 day period, and a
determination, by a physician mutually acceptable to the Company and the
Executive, at the end of such period that the Executive is unable to perform the
normal duties of the Executive hereunder;
"Value" has the meaning ascribed to that term in Section 20
hereof; and
2. Term of Employment. The Company agrees to employ the
Executive, and the Executive agrees to render personal services to the Company
and its Subsidiaries as Chief Operating Officer of the Company for an initial
term of 34 months (the "Initial Term"), which Initial Term shall be
automatically extended for successive 12 month periods on the same terms and
conditions, unless one Party provides to the other party a notice of non-renewal
at least six (6) months prior to the expiration of the Initial Term or any
extension thereof (hereinafter, the Initial Term, as the same may be extended,
shall be referred to as the "Term"). Executive shall
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not be required to hold any position or to perform any duty or assignment
materially inconsistent with those positions or his experience and
qualifications, it being agreed and understood that the personal services to be
rendered by Executive to the Company and its Subsidiaries hereunder are of a
special and unique character.
3. Duties of Executive. Executive agrees that, at all times
during the Term, Executive will serve as a member of the Company's Board of
Directors and as the Company's Chief Operating Officer and shall:
(i) faithfully and diligently perform, to the best
of his ability, such duties and services of such nature and commensurate with
such position, as may from time to time be assigned to him by the Board of
Directors of the Company; and
(ii) devote Executive's undivided time and attention,
during the Company's then customary business hours, to the performance of his
duties hereunder and to the business and affairs of the Company and its
Subsidiaries and to promoting the best interests of the Company and its
Subsidiaries to such extent as may be necessary for the proper performance of
the personal services to be rendered by Executive hereunder, and he shall not,
either during or outside of business hours, engage in any activity inimical to
the best interests of the Company or any of its Subsidiaries.
(iii) at the request of the Company, serve as an
officer or director of the Company or any of its Subsidiaries without additional
compensation.
4. Base Salary. The Company agrees to pay Executive a
base salary for his services at the rate of $375,000 per annum payable in equal
semi-monthly installments. The rate of Executive's base salary shall be reviewed
annually as of each May 1 (beginning on May 1, 2002); except that no such annual
review shall result in any reduction in the Executive's base salary as in effect
at the date of such review.
5. Performance Cash Bonuses.
(i) With respect to each Fiscal Year ending during
the Term, Executive will be eligible to receive a cash bonus equal to a
percentage of his Base Salary, calculated in accordance with Exhibit A annexed
hereto.
(ii) If such a bonus is earned with respect to any
Fiscal Year, such bonus will be paid to Executive within 30 days following
receipt by the Company of its certified consolidated financial statements for
the relevant year, but not later than 125 days after the end of the Fiscal Year
to which such bonus relates.
(iii) It is specifically agreed that the Company's
EBITDA (as defined in Exhibit A) during the period commencing on January 1, 2001
and ending on the last day of the Company's Fiscal Year ending in 2001, shall
not be included in the calculation of Executive's
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bonus for the Fiscal Year ending in 2002, but shall be included in the
calculation of Executive's bonus (based upon the Company's EBITDA for the Fiscal
Year ending in 2001) to be paid to Executive pursuant to Executive's prior
employment agreement with Xxxxxxxx'x, referred to in the recitals hereof.
6. Profit Sharing. During the Term, the Executive
shall be entitled to participate in any deferred profit sharing plan of the
Company, in accordance with the terms of any such plan and applicable law, it
being understood, however, that nothing contained herein shall prevent the
Company from amending, modifying or terminating any such plan in any manner
whatsoever if, but only if, the Executive is treated no less favorably than
other participants in any such plan as a result of such amendment, modification
or termination.
7. Automobile, Etc.. During the Term, the Executive
shall be entitled to receive an allowance for automobile, gasoline, club dues
and other expenses not to exceed $15,000 in the aggregate for each Fiscal Year,
consistent with past practices, prorated in the case of any Fiscal Year which is
less than 12 months in duration or which does not fall entirely within the Term.
8. Life Insurance.
(a) During his employment with the Company, the
Company shall provide the Executive with term life insurance providing a death
benefit equal to three times his then base salary, it being understood that the
Executive is presently insurable at normal rates and that the Executive will
bear the cost of such insurance upon renewal to the extent such cost exceeds
normal rates.
(b) After the termination of Executive's employment
hereunder (including upon expiration of the contract term) other than for
"Cause" or by Executive without Good Reason (as such terms are hereafter
defined), for the remainder of Executive's life or until Executive attains the
age of 70 or obtains full-time employment with any Person other than the
Company, the Company shall obtain and maintain life insurance for Executive's
benefit in the amount equal to his Base Salary upon the termination of such
employment. For purposes of the preceding sentence, Executive's retirement from
the Company after age 62 shall not be deemed a termination of this Agreement for
without Good Reason.
9. Medical Insurance.
(a) During his employment with the Company, the
Executive shall be entitled to group medical insurance coverage in accordance
with the terms and conditions of such plans as are maintained by the Company, it
being understood, however, that nothing contained herein shall prevent the
Company from amending, modifying or terminating such plans in any manner if, but
only if, (i) the Executive is treated no less favorably than other participants
in such plans as a result of such amendment, modification or termination, and
(ii) the Executive shall be entitled to a group medical plan at group rates,
together with excess medical reimbursement of up
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to $5,000 a year for medical, dental, optical or other health expenses not
covered or only partially covered under the Company's group medical plan.
(b) After the termination of Executive's employment
hereunder (including upon expiration of the contract term) other than for Cause
or by Executive without Good Reason, the Company shall continue to provide
medical insurance to Executive and his then current spouse (provided such spouse
continues to be married to Executive following his termination hereunder) for
the duration of their respective lives in accordance with the terms and
conditions of such plans as are maintained by the Company; provided, that, if
Executive obtains full-time employment with any Person other than the Company,
the Company shall not be obligated to provide coverage set forth in this Section
9(b). For purposes of the preceding sentence, Executive's retirement from the
Company after age 62 shall not be deemed a termination of this Agreement by
Executive without Good Reason.
10. Disability Insurance. During the Term, the Company
shall provide the Executive with long-term disability insurance providing an
annual benefit in the event of such disability of at least equal to one half of
his then base salary. In the event of the Executive's illness or disability, the
Company shall continue to pay the Executive base salary at his then annual rate,
and continue to provide all benefits and all other compensation required by this
Agreement unless and until the Executive's employment is terminated by reason of
his Total Disability and an eligibility, waiting or comparable period under the
disability insurance policy expires and payments to the Executive begin under
the policy.
11. Tax Returns. During the Term, the Company shall pay
for preparation of the Executive's federal and state income tax returns by the
Company's regular outside accountants or, if the Executive so elects, shall
reimburse the Executive in an amount of up to a maximum of $2,100 per year for
fees paid to another accountant in connection with the preparation of such
returns.
12. Discount on Purchases; Expenses. During the Term,
the Executive shall benefit from the Company's Executive Discount Purchase Plan.
The Company shall reimburse Executive for all items of normal expense incurred
by Executive as an employee of the Company as authorized or approved under
guidelines and policies fixed from time to time by the Board of Directors.
13. Vacation. During the Term, the. Executive shall be
entitled to four (4) weeks of vacation per year, during which the Executive
shall receive his normal compensation payable hereunder. The Company shall not
pay the Executive any additional compensation for any vacation time not used by
the Executive.
14. Other Benefits. The Company and its Subsidiaries
have adopted certain employee benefit plans and have established certain
arrangements concerning executive perquisites which may, from time to time,
confer rights and benefits on the executive in accordance with their terms, and
the Company and it Subsidiaries may, in the future, adopt additional employee
benefit plans and establish additional arrangements concerning executive
perquisites, and may in the future amend, modify or terminate any of the
aforesaid employee
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benefit plans and arrangements, all in accordance with their terms and in
accordance with applicable law. Subject to any limitations imposed from time to
time under applicable law or regulation, the Executive shall be entitled to
participate in all such benefit plans which cover senior employees of the
Company and its Subsidiaries.
15. Stock Options. Executive shall be entitled to
participate in any stock option plan adopted by the Company and may be granted
options in accordance with the terms of any such plan.
16. Termination of Employment.
(a) Death or Total Disability. The employment of the
Executive will terminate upon his death or Total Disability. If, during the
Term, the employment of the Executive is terminated due to death or Total
Disability, the Executive or his estate shall receive, within 30 days of such
termination, base salary provided for in Section 4 as then in effect, accrued
through the date of termination. Upon such termination, all other benefits under
this Agreement (except indemnification under Section 21) shall lapse, expire and
be forfeited (other than the proceeds of the life insurance provided pursuant to
Section 8 which become payable by reason of the Executive's death, the
disability payments payable pursuant to Section 10 or the medical benefits
pursuant to Section 9 hereof, as the case may be); provided that Executive shall
also be paid any bonus pursuant to Section 5 earned with respect to any
previously completed Fiscal Year which remains unpaid as of such date of
termination and any amounts to which Executive may be entitled pursuant to the
plans, policies and practices of the Company then in effect.
(b) Termination For Cause or By Executive Without
Good Reason. The employment of the Executive may be terminated by the Company at
any time for Cause or by Executive without Good Reason. If, during the Term, the
employment of the Executive is terminated by the Company for Cause or by
Executive without Good Reason, the Executive shall receive, within 30 days of
such termination, base salary provided for in Section 4 as then in effect,
accrued through the date of termination. Upon such termination, all other
benefits under this Agreement (except indemnification under Section 21) shall
lapse, expire and be forfeited; provided that Executive shall also be paid any
bonus pursuant to Section 5 earned with respect to any previously completed
Fiscal Year which remains unpaid as of such date of termination and any amounts
to which Executive may be entitled pursuant to the plans, policies and practices
of the Company then in effect.
(c) Termination Without Cause. The employment of the
Executive may also be terminated by the Company at any time without Cause.
Subject to Section 17 of this Agreement, if (i) after the Initial Term, the
employment of the Executive is terminated by the Company without Cause, or (ii)
prior to the expiration of the Initial Term, the Company provides Executive with
a notice of non-renewal and the Initial Term is not extended, the Executive
shall continue to receive base salary provided for in Section 4 as then in
effect for the longer of 18 months following termination or the remainder of the
Term. In addition (and also subject to Section 17 hereof), Executive shall be
entitled to receive (i) the benefits contemplated by
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Sections (8)b and 9(b) hereof, (ii) any bonus pursuant to Section 5 earned with
respect to any previously completed Fiscal Year which remains unpaid as of such
date of termination, (iii) a cash payment equal to a prorated portion of the
bonus Executive would have received pursuant to Section 5 hereof at the end of
the Fiscal Year in which his employment is terminated and (iv) any amounts to
which Executive may be entitled pursuant to the plans, policies and practices of
the Company then in effect.
(d) Termination by Executive for Good Reason. The
employment of the Executive may also be terminated by the Executive at any time
for Good Reason. Subject to Section 17 of this Agreement, if, during the Term,
the employment of the Executive is terminated by the Executive for Good Reason,
the Executive shall continue to receive base salary provided for in Section 4 as
then in effect for the longer of 18 months following termination or the
remainder of the Term. In addition (and also subject to Section 17 hereof),
Executive shall be entitled to receive (i) the benefits contemplated by Sections
(8)b and 9(b) hereof, (ii) any bonus pursuant to Section 5 earned with respect
to any previously completed Fiscal Year which remains unpaid as of such date of
termination, (iii) a cash payment equal to a prorated portion of the bonus
Executive would have received pursuant to Section 5 hereof at the end of the
Fiscal Year in which his employment is terminated and (iv) any amounts to which
Executive may be entitled pursuant to the plans, policies and practices of the
Company then in effect.
(e) Change of Control. If Executive's employment is
terminated coincident with or within one year after a Change of Control (as
defined below), either by the company or by Executive for Good Reason, Executive
shall be paid, within 10 days after such termination, a lump sum, in cash, equal
to (i) 24 months' base salary as then in effect, plus (ii) two times any bonus
earned by Executive in the Fiscal Year preceding the date of termination. In
addition, Executive shall be entitled to any amounts to which Executive may be
entitled pursuant to the plans, policies and practices of the Company then in
effect. Anything to the contrary herein notwithstanding, if any payment pursuant
to this Section 16(e) would be a "parachute payment" as defined in section 280G
of the Internal Revenue Code of 1986, as amended, such payment shall be limited
to the largest portion of such payment as can be paid without being deemed a
"parachute payment." Except as provided in this paragraph 16(e), upon a
termination of employment pursuant to this paragraph, all other benefits under
this Agreement (except indemnification under Section 19) shall lapse, expire and
be forfeited.
For purposes of this Section l6 (e), a "Change in Control"
shall be deemed to have occurred if (1) any Person (as such term is used in
Section 13 (d)of the Securities Exchange Act of 1934, as amended (the "Exchange
Act")) becomes the "beneficial owner" (as determined pursuant to Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company
representing fifty percent (50%) or more of the combined voting power of the
Company's then outstanding securities; or (2) during any period of two
consecutive years, individuals who at the beginning of such period constitute
the members of the Company's Board of Directors (the "Board") and any new
director, whose election to the board or nomination for election to the Board by
the Company's stockholders was approved by a vote of a majority of the directors
then still in office who either were directors at the beginning of the period or
whose election or nomination for election was previously so approved, cease for
any reason to constitute
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a majority of the Board; or (3) the Company shall merge with or consolidate into
any other corporation, other than a merger or consolidation which would. result
in the holders of the voting securities of the Company outstanding immediately
prior thereto holding immediately thereafter securities representing more than
fifty percent (50%) of the combined voting power of the voting securities of the
Company or such surviving entity outstanding immediately after such merger or
consolidation; or (4) the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of all or substantially all of the Company's assets or such a plan is
commenced or such a sale or other disposition is consummated.
17. Mitigation By Executive. During the first nine (9)
months following any (i) termination of Executive by the Company without Cause,
(ii) termination by Executive for Good Reason, or (iii) termination of Executive
at the end of the Initial Term, the Executive shall have no obligation to
mitigate amounts payable to him pursuant to Sections 16(c) or 16(d) hereunder by
seeking comparable employment; provided, however that after such nine (9)
months, Executive shall have the obligation to seek comparable employment and
any amounts earned by him shall reduce any amounts payable by the Company under
Section 16(c) or 16(d) hereof.
18. Noncompetition.
(a) Executive agrees that, at all times during his
employment with the Company and for a period of nine (9) months after the
termination of this employment (the "Non-Compete Period"), Executive will not
engage or be engaged in any competing business, as herein defined.
(b) For purposes of this Section 18, Executive shall
be deemed to "engage or be engaged in a competing business" if, in any capacity,
including, but not limited to, proprietor, partner, trustee, officer, employee
or director, Executive engages or participates, directly or indirectly, in the
operation, management or Financing (as herein defined) of (i) any off-price
retail women's apparel store or a group of any such stores ("Store") or (ii) any
off-price retail women's apparel business ("Business") which is in material
competition with the Company. Indirect participation in the operation or
management of any Store or Business shall include, but not be limited to, the
Financing of any Store or Business in the form of a loan, guaranty of a loan, or
the pledging of securities for the repayment of a loan. The term "Financing" as
herein used means and refers to an aggregate investment of $25,000 or more, by
way of loans to (including the guaranty of or furnishing of security for the
repayment of loans to), or capital stock or other proprietary interest in, any
one or more than one Store or Business, if the amount of such investment
represents more than one percent in Value of the corporation, partnership or
other. business entity owning such Store or Business. The term "Value" as herein
used means the net worth of such corporation, partnership or other business
entity, as disclosed by the balance sheet of such corporation, partnership or
other business entity, as of the close of its last preceding fiscal year; except
that with respect to an investment in stock or other securities of a
corporation, which stock or other securities are part of a class of stock or
other securities Actively Traded, the term "Value" shall mean the market value
of such stock or other securities of such corporation. Executive and the Company
hereby agree that if Executive violates the terms of this Section 18,
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then, in addition to all other rights and remedies which the Company may have
under the terms hereof and pursuant to all applicable law, (i) the Company shall
have the right to seek and obtain equitable relief in the form of a temporary
restraining order and permanent injunction against Executive's violation of the
terms of this Section 18, (ii) any sums payable to Executive under this
Agreement shall be forfeited and (iii) all other obligations of the Company to
Executive shall be terminated.
19. Indemnification. The Company shall, and shall
cause its Subsidiaries to indemnify the Executive to the fullest extent
permitted (including payment of reasonable expenses in advance of a final
disposition of a proceeding) by applicable law and the Certificates of
Incorporation and By-Laws of the Company and such Subsidiaries, as in effect at
the time of the subject act or omission, and the Executive shall be entitled to
the protection of any insurance policies the Company or any such Subsidiary may
elect to maintain for the benefit of any of its directors and officers, against
all reasonable costs, charges and expenses incurred or sustained by him or his
legal representatives at the time such costs, charges and expenses are incurred
or sustained, in connection with any action, suit or proceeding to which he (or
his legal representatives or other successors) may be made a party by reason of
his being or having been a director, officer or employee of the Company or any
Subsidiary, or his serving or having served any other enterprise as a director,
officer or employee at the request of the Company. This covenant and agreement
of the Company and its Subsidiaries shall survive this Agreement and continue in
force and effect after the expiration of the term hereof.
20. Confidentiality. Executive covenants and agrees to
hold in strictest confidence any and all of the Company's confidential data,
including but not limited to information and documents concerning the Company's
business, suppliers, supplier and customer lists, marketing methods, advertising
plans, files, trade secrets, patents and patent applications, "know-how"
techniques or other technical . information not of a published nature or other
information which shall come into Executive's possession or custody concerning
the business of the Company except (i) to the extent any such information enters
the public domain other than by reason of a breach by the Executive of this
Section 20 and (ii) to the extent the Executive is required by law to disclose
any such information and (iii) to the extent such information is generally known
to the industry or the public other than as a result of Executive's breach-of
this Agreement. The Executive will immediately notify the Company if he believes
he is required by law to disclose any such information, so that the Company may
determine whether or not to oppose such requirement. This covenant and agreement
of Executive shall survive this Agreement and continue in force and effect after
the expiration of the term hereof, whether by limitation or otherwise.
21. Severability. The Company and Executive
hereby-agree that should any court of competent jurisdiction determine that any
provision of this Agreement shall, but for the provisions of this Section 21, be
illegal or void as against public policy, for any reason, then such provision
shall automatically be amended to the extent (but only to the extent) necessary
to make it sufficiently narrow in scope, time and geographic area that such
court shall determine it not to be illegal or void as against public policy. If
any such provision cannot be amended to the extent provided in the preceding
sentence, then such provision shall be severed from this Agreement. In either
event, all other remaining terms and provisions shall remain in full force and
effect.
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22. Enforcement. The Company and Executive shall each
be entitled to pursue all legal and equitable rights and remedies to secure
performance of the obligations and duties of the other under this Agreement, and
enforcement of one or more of such rights and remedies shall in no way preclude
the Company or Executive from pursuing, at the same time or subsequently, any
and all other rights and remedies available to each of them.
23. Withholding. All payments to be made to the Executive
under this Agreement shall be reduced by all required withholding.
24. Entire Agreement. The entire understanding and
agreement between the parts has been incorporated into this Agreement, and this
Agreement supersedes all other agreements and understandings between the parties
with respect to the employment of Executive by the Company. This Agreement shall
inure to the benefit of, and shall be binding upon, the Company and its heirs,
successors and assigns, and none of the provisions of this Agreement are
intended to be, nor shall they be construed to be, for the benefit of or
enforceable by any Person who is not a party hereto. Executive agrees that this
Agreement may be assigned by the Company to a Subsidiary of the Company; such
assignment, however, shall not relieve the Company of any of its obligations
hereunder except to the extent that such obligations are actually discharged by
such Subsidiary and shall not involve duties that are inconsistent with the
duties described in Section 3 hereof or any reduction in status. By signing
below, the Company warrants and represent that this Agreement and the Company's
performance hereunder have been duly authorized by all requisite corporate
action and that this Agreement constitutes its legal and binding obligation,
duly enforceable against it in accordance with its terms.
25. Governing Law. Any question or other matter arising
under this Agreement, whether of validity, interpretation, performance or
otherwise, shall be determined in accordance with, and governed by, the laws of
the State of New York.
26. Miscellaneous. The captions in this Agreement are
not part of the provisions hereof, are merely for the purpose of reference and
shall have no force or effect for any purpose whatsoever, including the
construction of the provisions of this Agreement, and if any caption is
inconsistent with any provisions of this Agreement, such provisions shall
govern.
(a) This Agreement may not be waived, changed, modified
or discharged orally, but only by an agreement in writing signed by the party
against whom any waiver, change, modification or discharge is sought.
(b) All notices given hereunder shall be in writing
and shall be sent by registered or certified mail, return receipt requested, or
by Federal Express or other national overnight courier service capable of
providing delivery confirmation, or by hand-delivery, or by facsimile
transmission with confirmed receipt, and, if intended for the Company, shall be
addressed to it at 0000 Xxxxxx Xxxxxx, Xxxxx, Xxx Xxxx 00000, Attn: Co Chairman
of the Board,
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or at, or at such other address or addresses and for the attention of such other
person or persons of which the Company shall have given notice to the Executive
in the manner herein provided, with a copy to Xxxxxx Xxxxxx LLP, 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, XX 00000, Attention: Xxxxxxx Rosedale, Esq., and if intended
for the Executive, shall be addressed to him at his then current residence
address as shown by the employment records of the Company, or at such other
address or to such designee of which the Executive shall have given notice to
the company in the manner herein provided. Each such notice shall be deemed to
be given on the date received at the address of the addressee or upon refusal to
accept delivery.
(c) The Company and the Executive will treat this
Agreement as confidential, and neither of them will disclose the contents of
this Agreement to any person, except as may be required by law and except as the
Company may need to do so in its dealings with banks or other lenders or
otherwise in the normal course of business.
(d) The Executive irrevocably (i) consents to the
jurisdiction of the Supreme Court of the State of New York, New York County, and
of any Federal court located in or having jurisdiction over that County in
connection with any act taken or omitted hereunder, (ii) waives and agrees not
to assert in any such action, suit or other proceeding that he is not personally
subject to the jurisdiction of such courts, that the action, suit or other
proceeding is brought in an inconvenient forum or that the venue of the action,
suit or other proceeding is improper, (iii) waives personal service of any
summons, complaint or other process and (iv) agrees that the service thereof may
be made by certified or registered mail directed to the Executive at his address
for purposes of notices hereunder. Should the Executive fail to appear or answer
within 30 days, he shall be deemed in default and judgment may be entered by the
Company against him for the amount or other relief as demanded in any summons,
complaint or other process so served. Nothing contained herein shall affect the
rights of the Company to bring such an action, suit or other proceeding in any
other jurisdiction.
(e) This Agreement may be executed in one or more
counterparts, and all such counterparts shall constitute one Agreement, binding
on all the parties notwithstanding that all of the parties are not signatories
to the original or the same counterpart.
XXXXXXXX'X HOLDINGS, INC.
By:/s/ Xxxxxx Xxxxx
---------------------------------
Name: Co Chairman of the Board
Title:
/s/ Xxxxxx Xxxxx
---------------------------------
Xxxxxx Xxxxx
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EXHIBIT A
BONUS CALCULATION
If the Company's consolidated earnings before interest, taxes,
depreciation and amortization but after any bonus payable to Executive hereunder
("EBITDA"), equals or exceeds $23.0 M (but is less than $24.0 M), Executive
shall be entitled to a bonus equal to 35% of his base salary.*
If the Company's EBITDA, equals or exceeds the EBITDA threshold of
$24.0 M (but is less than $25.0 M), Executive shall be entitled to a bonus equal
to 45% of his base salary.*
If the Company's EBITDA, equals or exceeds the EBITDA threshold of
$25.0 M (but is less than $26.0 M), Executive shall be entitled to a bonus equal
to 55% of his base salary.*
If the Company's EBITDA, equals or exceeds the EBITDA threshold of
$26.0 M (but is less than $27.0 M), Executive shall be entitled to a bonus equal
to 65% of his base salary.**
If the Company's EBITDA, equals or exceeds the EBITDA threshold of
$27.0 M (but is less than $28.0 M), Executive shall be entitled to a bonus equal
to 80% of his base salary.***
If the Company's EBITDA, equals or exceeds the EBITDA threshold of
$28.0 M (but is less than $29.0 M), Executive shall be entitled to a bonus equal
to 100% of his base salary.***
If the Company's EBITDA, equals or exceeds the EBITDA threshold of
$29.0 M (but is less than $30.0 M), Executive shall be entitled to a bonus equal
to 120% of his base salary.***
If the Company's EBITDA, equals or exceeds the EBITDA threshold of
$30.0 M, Executive shall be entitled to a bonus equal to 140% of his base
salary.
* For every $100,000 over the established EBITDA threshold, Executive shall
be entitled to a 1% increase in the percentage of base salary to be paid to him
as a bonus hereunder.
**For every $100,000 over the established EBITDA threshold, Executive shall
be entitled to a 1.5% increase in the percentage of base salary to be paid to
him as a bonus hereunder.
***For every $100,000 over the established EBITDA threshold, Executive
shall be entitled to a 2% increase in the percentage of base salary to be paid
to him as a bonus hereunder.
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