Exhibit 10.20
As of January 24, 2000
Xx. Xxxx X. Xxxxxxx
00 Xxxxxxxx Xxxx
Xxxxxxx, Xxx Xxxxxx 00000
Dear Xxxx:
This will confirm the terms and conditions of employment (the "Agreement")
between you and Candie's, Inc. (the "Company") (each a "Party" and together, the
"Parties"). It is agreed as follows:
1. Term.
The Company will employ you for an initial period commencing on January 24,
2000 and ending on January 26, 2001 (the "Initial Term"). This agreement will
automatically renew for 3 month intervals (the " Additional Term"), unless
written notice is provided on the 3 month anniversary of the agreement starting
June 24, 2000. This notice is to act as a minimum severance of three months.
2. Title; Duties.
You shall render services to the Company on a full-time basis as the Vice
President of Finance. Your duties and responsibilities shall be consistent with
the duties customarily undertaken by the senior financial management officer of
a public ally traded corporation.
3. Compensation.
(a) Base Salary. Your base salary for the initial term will be at a rate of
not less than $170,000 per annum paid in accordance with the Company's payroll
practices and policies.
(b) Bonus. You are entitled to a signing bonus of $ 10,000 payable January
24, 2000. Your cash bonus for the initial term and each following fiscal years
will be discretionary, based upon annually established company and personal
objectives. This bonus will be payable upon filing the annual 10-k.
(c) Stock Options. On January 24, 2000, you shall receive a grant of
qualified stock options pursuant to the Company's most recently adopted option
plan for 75,000 shares of the Company's common stock, exercisable on the latest
date possible under such plan, at a price equal to the closing price of the
stock on January 24,2000. The options shall vest and become exercisable as
follows: 25,000 on January 24, 2001, 25,000 on January 24, 2002 and 25,000 on
January 24, 2003. If the Company terminates you prior to the expiration of the
Term for a reason other than "Cause" (as defined herein), or you resign for
"Good Reason" (as defined herein), all options shall vest upon the date such
termination is effective.
(d) The Company shall lease a car for you with monthly lease payments not
to exceed $725. The Company shall, in addition, reimburse you for all parking,
maintenance, repairs, insurance, gas, tolls and other related expenses promptly
upon your submission of appropriate documentation.
4. Benefits and Expenses.
(a) You shall be permitted during the Term to participate (without any
waiting periods) in any and all benefit plans, hospitalization, medical, health,
disability, officer/director or employee liability insurance plans, pension and
401K plans or other benefit plans (including any to-be-established bonus plans)
on the same terms and conditions as extended to other executive officers of the
Company.
(b) The Company shall promptly reimburse you for all reasonable and
necessary travel and entertainment expenses and other disbursements or costs you
may incur in connection with promoting the business of the Company.
(c) You shall be entitled to three weeks paid vacation per year. If, in any
year, you do not take some or all of your vacation, such unused days may only be
banked with written consent and carried over into the next year, as may be
applicable.
(d) You shall be permitted to attend such professional conferences, receive
such professional publications, acquire such professional books and materials to
build a library, and receive such other facilities and support as are reasonable
and necessary to and perform your duties and maintain active status in
accounting and legal professions.
5. Termination.
(a) Your employment may be terminated by the Company prior to the
expiration of the Term of this agreement only for "Cause" by giving you prior
written notice of the basis for the proposed termination and a reasonable chance
to cure. As used in this agreement, the term "Cause" shall mean: (a) your
willful and continuing malfeasance and failure to perform having a material
adverse effect on the Company; (b) your willful engagement in fraud or
dishonesty against the Company having a material adverse effect on the Company;
or (c) your conviction of a felony involving moral turpitude.
(b) You may terminate this Agreement at any time for "Good Reason" by
giving the Company prior written notice of the basis for the proposed
termination and a reasonable chance to cure. "Good Reason" shall mean any of the
following: (i) a breach by the Company of any of its payment obligations to you
hereunder; (ii) relocation of the Company outside a 50-mile radius of New York
City unless the Company shall provide you with a suitable location from which to
work within such radius; (iii) a proposed material modification or reduction of
your duties or position as a senior financial executive; (iv) the bankruptcy,
reorganization or liquidation of the Company; or (v) a "Change of Control". A
"Change of Control" shall mean: (1) an occurrence resulting in any person or
entity other than an existing subsidiary or affiliate of the Company acquiring
or being the beneficial owner of 20% of more of the combined voting power of the
Company's outstanding securities resulting in Xxxx Xxxx no longer being Chairman
of the Board; (2) Xxxx Xxxx no longer occupying a position as a senior executive
of the Company; or (3) the acquisition of the Company by, or the merger of the
Company into or with, an entity other than an existing subsidiary or affiliate
of the Company.
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6. Effect of Termination.
(a) Upon termination of your employment for Cause (or upon your death or
disability, rendering you unable to perform), you (or your heirs or
representatives) shall receive any accrued salary, pro-rated bonus and vacation
due through the date of termination and be reimbursed for any outstanding
business expenses (including those relating to your car) incurred prior to the
date of termination. Upon your death or disability, you or your heirs shall also
be entitled to continuation of health and medical benefits for 6 months from the
date of termination.
(b) Upon termination of your employment not for Cause, or if you terminate
for Good Reason, you shall receive your full compensation (salary, bonus, car
allowance, vacation and the continuance of all other benefits) through the
unexpired portion of the Term, but in no event for a period less than 6 months,
payable in equal monthly installments following the date of termination. In
addition, all unvested options shall vest on the date of termination.
(c) Upon termination of your employment upon the occurrence of a Change of
Control, you shall receive all the amounts set forth in 6(b) above, plus an
amount equal to one full year of your base salary at the rate in effect at the
time that the Change of Control occurs.
7. Confidentiality
You acknowledge that, during the course of your employment by the Company, you
will have access to valuable confidential information, including but not limited
to: customers and prospects lists, cost lists, merchandising data, inventions,
designs, manufacturing methods and techniques and other information which
relating to the activities and business of the Company and its affiliates
("Confidential Material"). You agree that such Confidential Material shall be
and remain the Company's property, free of any rights on your part with respect
thereto, and that you shall keep it confidential at all times during, and
following the cessation of your employment with the Company. You agree to
deliver to the Company all computer files and tapes, books record and documents
(whether maintained in paper, electronic or other medium) relating to or bearing
upon any such Confidential Material, upon the cessation of your employment, and
you agree not to retain any copies or extracts.
8. Miscellaneous
(a) This agreement shall be governed by the laws of New York and each Party
agrees that in the event of a dispute relating to the terms hereof the other
will submit to the exclusive jurisdiction of the state or federal courts sitting
within the City of New York.
(b) If not terminated in accordance with its terms, this Agreement shall be
binding upon, and inure to the benefit of, the Parties, their heirs, legal
representatives, successors and permitted assigns.
(c) The invalidity or unenforceability of any provision hereof shall not in
any way affect the validity or enforceability of any other provision. This
Agreement reflects the entire understanding between the Parties.
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Please sign where indicated below, whereupon this letter will constitute a
binding agreement between the Parties as of the date first above written.
Candies, Inc.
By: /s/ Xxxx Xxxx /s/ Xxxx Xxxxxxx
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Xxxx Xxxx Xxxx X. Xxxxxxx
Chief Executive Officer
