EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated as of January 1, 1997, between REVLON
CONSUMER PRODUCTS CORPORATION, a Delaware corporation (the "Company"), and
XXXXXX XXXXXXX (the "Executive").
The Company wishes to continue the employment of the Executive, and
the Executive wishes to accept such continued employment, on the terms and
conditions set forth in this Agreement.
Accordingly, the Company and the Executive hereby agree as follows:
Employment, Duties and Acceptance.
1.1 Employment, Duties. The Company hereby employs the
Executive for the Term (as defined in Section 2.1), to render exclusive and
full-time services to the Company, initially in his present capacity as chief
operating officer of the Company and, upon the effectiveness of his election
as such, which the Company promptly shall recommend to the Board of Directors
of the Company or a committee thereof, in the capacity of chief executive
officer of the Company, and to perform such other duties consistent with such
position (including service as a director or officer of any affiliate of the
Company, if elected) as may be assigned by the Board of Directors of the
Company. The Executive's title shall be President and Chief Operating Officer
prior to the effectiveness of his election as chief executive officer, and
thereafter shall be President and Chief Executive Officer, or such other
titles of at least equivalent level consistent with the Executive's duties
from time to time as may be assigned to the Executive by the Board of
Directors.
1.2 Acceptance. The Executive hereby accepts such employment
and agrees to render the services described above. During the Term, the
Executive agrees to serve the Company faithfully and to the best of the
Executive's ability, to devote the Executive's entire business time, energy
and skill to such employment, and to use the Executive's best efforts, skill
and ability to promote the Company's interests.
1.3 Location. The duties to be performed by the Executive
hereunder shall be performed primarily at the office of the Company in the New
York City metropolitan area, subject to reasonable travel requirements
consistent with the nature of the Executive's duties from time to time on
behalf of the Company.
2. Term of Employment; Certain Post-Term Benefits.
2.1 The Term. The term of the Executive's employment under
this Agreement (the "Term") shall commence on the date hereof (the "Effective
Date") and shall end on such date as is provided pursuant to Section 2.2.
2.2 End-of-Term Provisions. At any time on or after the fourth
anniversary of the Effective Date the Company shall have the right to give
written notice of non-renewal of the Term. In the event the Company gives such
notice of non-renewal, the Term automatically shall be extended so that it
ends twelve months after the last day of the month in which the Company gives
such notice. If the Company shall not theretofore have given such notice, from
and after the fifth anniversary of the Effective Date unless and until the
Company gives written notice of non-renewal as provided in this Section 2.2,
the Term automatically shall be extended day-by-day; upon the giving of such
notice by the Company, the Term automatically shall be extended so that it
ends twelve months after the last day of the month in which the Company gives
such notice. Non-extension of the Term shall not be deemed to be a breach of
this Agreement by the Company for purposes of Section 4.4, provided, however,
that during any period that the Executive's employment shall continue
following termination of the Term, the executive shall be eligible for
severance on terms no less favorable than those of the Revlon Executive
Severance Plan as in effect on the date of this Agreement (other than the
provision in Paragraph IIIC(ii) establishing a limit of six months of payment
which shall not be applicable to the Executive) upon the Executive's
compliance with the terms thereof.
2.3 Special Curtailment. The Term shall end earlier than
the date provided in Section 2.2, if sooner terminated pursuant to Section 4.
3. Compensation; Benefits.
3.1 Salary. As compensation for all services to be rendered
pursuant to this Agreement, the Company agrees to pay the Executive during the
Term a base salary, payable semi-monthly in arrears, at the annual rate of not
less than $1,250,000 during 1997, $1,350,000 during 1998, $1,450,000 during
1999, $1,550,000 during 2000 and $1,700,000 during the balance of the Term
(the "Base Salary"). All payments of Base Salary or other compensation
hereunder shall be less such deductions or withholdings as are required by
applicable law and regulations. In the event that the Company, in its sole
discretion, from time to time determines to increase the Base Salary, such
increased amount shall, from and after the effective date of the increase,
constitute "Base Salary" for purposes of this Agreement.
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3.2 Bonus. In addition to the amounts to be paid to the
Executive pursuant to Section 3.1, the Executive shall receive an annual bonus
of up to 100% of the Executive's Base Salary at the rate in effect during the
calendar year in which bonus is earned, based upon achievement of objectives
set annually not later than February 28 of such year by the Compensation
Committee of the Board of Directors of the Company.
3.3 Stock Options. The Executive shall be recommended to the
Compensation Committee or other committee of the Board administering the 1996
Revlon Stock Plan or any plan that may replace it, as from time to time in
effect, to receive an option not later than February 28 of each year of the
Term, commencing in 1997, each such option to cover a minimum of 170,000
shares of Revlon common stock, have a term of 10 years and have an option
exercise price equal to the market price of the Revlon common stock on the
date of grant and otherwise to be on terms (other than number of shares
covered) substantially the same as other senior executives of the Company
generally.
3.4 Business Expenses. The Company shall pay or reimburse the
Executive for all reasonable expenses actually incurred or paid by the
Executive during the Term in the performance of the Executive's services under
this Agreement, subject to and in accordance with the Company's applicable
expense reimbursement and related policies and procedures as in effect from
time to time.
3.5 Vacation. During each year of the Term, the Executive
shall be entitled to a vacation period or periods of four weeks taken in
accordance with the vacation policy of the Company as in effect from time to
time.
3.6 Fringe Benefits.
(i) During the Term, the Executive shall be entitled to
participate in those qualified and non-qualified defined benefit, defined
contribution, group insurance, medical, dental, disability and other benefit
plans of the Company as from time to time in effect made available to senior
executives of the Company generally and in the Company's Executive Medical
Plan providing for reimbursement of medical and dental benefits not payable
under plans generally available. In addition, during the Term the Executive
shall be entitled to the use of a Company-provided automobile in accordance
with the Company's executive automobile policy and guidelines as from time to
time in effect, and shall be entitled to the use of an assigned
Company-provided chauffeured automobile during the business week for personal
and business use and at other times as required for business purposes, and
shall be grossed up for the tax effects of such use. Further, during the Term
the Executive shall be reimbursed for the initiation fees, dues, assessments
and like fees for membership in one country club of the Executive's choice,
and shall be entitled to the use of Company-provided private aircraft, as
available, for the business and personal travel of himself and his immediate
family members.
(ii) During the Term, the Company agrees to make available to
the Executive additional life insurance coverage with a death benefit of three
times the Executive's Base Salary from time to time, subject to the insurer's
satisfaction with the results of any required medical examination, to which
the Executive hereby agrees to submit, and shall reimburse the Executive for
the premium expense related thereto and gross the Executive up for the tax
payable with respect to such reimbursement. Such coverage shall be provided
pursuant to the Company's optional supplemental term insurance program, if
available, or if not, the Executive may select a plan of the Executive's
choice and may designate the beneficiary of such plan.
(iii) During the Term the Company shall maintain an individual
policy of disability insurance, naming the Executive as the insured and the
Executive or a designee as the beneficiary, with a benefit equal to (A) fifty
percent of the sum of the Executive's Base Salary in effect on the date of
disability plus the Executive's most recent annual bonus pursuant to Section
3.2 less (B) the long-term disability benefit payable under the Company's
group disability program as in effect from time to time (irrespective of
whether the Executive has elected to participate in such long-term disability
program), and upon the Executive's retirement in accordance with the
requirements of the Company's former supplemental employees' retirement plan
the Company shall provide to the Executive a death benefit equal to two times
the Executive's final Base Salary (which benefit may be provided from
insurance or from the Company's unsegregated general funds, as the Company may
elect).
(iv) If the Executive remains continuously employed with the
Company or an affiliate of the Company from the date hereof until age 60, then
upon the Executive's retirement from the Company or its affiliate at or after
age 60 the Company shall provide or cause its affiliate to provide to the
Executive a supplemental payment in such amount, if any, as is required to
increase the Executive's annual pension benefit payable commencing at such
retirement from all qualified and non-qualified retirement plans of the
Company and any affiliates of the Company in which the Executive participates,
calculated on a straight life annuity basis, to $500,000 (it being agreed
that, should the Company or its affiliates so elect, it may satisfy its
obligation hereunder (A) by paying to the Executive $500,000 per year from the
effective date of the Executive's retirement through such later age as the
Company may elect and paying to the Executive thereafter such amount, if any,
as would be required to increase the Executive's annual pension benefit
commencing at such age to $500,000, as if the Executive had elected to defer
commencement of retirement benefits under the plans in which he participates
to such age, irrespective of whether the Executive in fact makes such an
election or (B) by granting to the Executive additional credited service,
modified final average compensation or other enhanced benefits under the
qualified and/or non-qualified retirement plans in which the Executive
participates, or (C) by a combination of the foregoing alternative
methodologies). If prior to age 60 the Executive's employment with the Company
or any affiliate of the Company by which he is employed is terminated by such
employer
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otherwise than for "cause" (as defined in Section 4.3) or "good reason" (as
defined in the Revlon Executive Severance Policy referred to in Section 4.4)
or the Executive retires with the written consent of the Company or any such
affiliate, then the Company shall provide or cause its affiliate to provide to
the Executive commencing at age 60, in lieu of the supplemental payment above
provided for, a reduced annual straight life annuity payment in an amount
equal to the product of multiplying $28,540 by the number of anniversaries, as
of the date of termination of employment, of the Executive's fifty-third
birthday (but in no event more than the supplemental payment provided for by
the preceding sentence upon retirement at age 60), it being agreed that,
should the Company or its affiliate so elect, it may satisfy such obligation
by any of the alternative methodologies provided above. Payments pursuant to
this clause (iv) shall be made quarterly or at such more frequent intervals as
the Company may elect. The Company's obligation under this clause (iv) shall
be an unsecured, unfunded and unaccrued contingent general obligation of the
Company to be satisfied from its unsegregated general funds, provided that the
Company shall have the right, if it so elects, to defease its obligation
hereunder by the purchase and delivery to the Executive of an annuity on his
life in the amount provided for above or to fund its obligation hereunder
through the purchase of insurance or other instruments, and the Executive
agrees to comply with the reasonable requests of the Company should the
Company elect to do so, including by submitting to medical examination.
4. Termination.
4.1 Death. If the Executive shall die during the Term, the
Term shall terminate and no further amounts or benefits shall be payable
hereunder except pursuant to life insurance provided under Section 3.6.
4.2 Disability. If during the Term the Executive shall become
physically or mentally disabled, whether totally or partially, such that the
Executive is unable to perform the Executive's services hereunder for (i) a
period of six consecutive months or (ii) shorter periods aggregating six
months during any twelve month period, the Company may at any time after the
last day of the six consecutive months of disability or the day on which the
shorter periods of disability shall have equaled an aggregate of six months,
by written notice to the Executive (but before the Executive has returned to
active service following such disability), terminate the Term and no further
amounts or benefits shall be payable hereunder, except that the Executive
shall be entitled to receive until the first to occur of (x) the Executive
ceasing to be disabled or (y) the Executive's attaining the age of 65,
continued coverage for the Executive under the Company paid group life
insurance plan (including supplemental coverage under Section 3.6) and for the
Executive and his spouse and children, if any, under the Company's group
medical (including executive medical) plan, to the extent permitted by such
plans and to the extent such benefits continue to be provided to the Company's
senior executives generally.
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4.3 Cause. In the event of gross neglect by the Executive of
the Executive's duties hereunder, conviction of the Executive of any felony,
conviction of the Executive of any lesser crime or offense involving the
property of the Company or any of its subsidiaries or affiliates, willful
misconduct by the Executive in connection with the performance of the
Executive's duties hereunder or other material breach by the Executive of this
Agreement, or any other conduct on the part of the Executive which would make
the Executive's continued employment by the Company materially prejudicial to
the best interests of the Company, the Company may at any time by written
notice to the Executive terminate the Term and, upon such termination, the
Executive shall be entitled to receive no further amounts or benefits
hereunder, except as required by law.
4.4 Company Breach; Other Termination. In the event of the
breach of any material provision of this Agreement by the Company or the
failure of the Compensation Committee (or other appropriate Committee of the
Company's Board of Directors) to fully implement the Company's recommendations
pursuant to Sections 1.1 and 3.3, the Executive shall be entitled to terminate
the Term upon 60 days' prior written notice to the Company. In addition, the
Company shall be entitled to terminate the Term at any time and without prior
notice otherwise than pursuant to the provisions of Section 2.2, 4.2 or 4.3.
Upon such termination by the Executive, or in the event the Company so
terminates the Term otherwise than pursuant to the provisions of Section 2.2,
4.2 or 4.3, the Company's sole obligation shall be (at the Executive's
election by written notice within 10 days after such termination) either (i)
to make payments in the amounts prescribed by Section 3.1 (less amounts
required by law to be withheld) and to continue the Executive's participation
in the group life insurance and in the basic and Executive medical plans of
the Company, in each case through the date on which the Term would have
expired pursuant to Section 2.2 if the Company had given notice of non-renewal
on the date of termination of employment, provided that any compensation
earned by the Executive from other employment or a consultancy during such
period shall reduce the payments provided for herein, and provided further
that the Executive shall cease to be covered by medical and/or dental plans of
the Company at such time as he becomes covered by like plans of another
company, or (ii) to make the payments and provide the benefits prescribed by
the Executive Severance Policy of the Company as in effect on the date of this
Agreement (other than the provision in Paragraph IIIC(ii) establishing a limit
of six months of payments, which shall not be applicable to the Executive),
upon the Executive's compliance with the terms thereof.
4.5 Litigation Expenses. If the Company and the Executive
become involved in any action, suit or proceeding relating to the alleged
breach of this Agreement by the Company or the Executive, then if and to the
extent that a final judgment in such action, suit or proceeding is rendered in
favor of the Executive, the Company shall reimburse the Executive for all
expenses (including reasonable attorneys' fees) incurred by the Executive in
connection with such action, suit or proceeding or the portion thereof
adjudicated in favor of the Executive. Such costs shall be paid to the
Executive promptly upon
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presentation of expense statements or other supporting information evidencing
the incurrence of such expenses.
5. Protection of Confidential Information; Non-Competition.
5.1 The Executive acknowledges that the Executive's work for
the Company will bring the Executive into close contact with many confidential
affairs of the Company not readily available to the public, including trade
secrets and confidential marketing, sales, product development and other data
and plans which it would be impracticable for the Company to effectively
protect and preserve in the absence of this Section 5 and the disclosure or
misappropriation of which could materially adversely affect the Company.
Accordingly, the Executive agrees:
5.1.1 Except in the course of performing the Executive's
duties provided for in Section 1.1, not at any time, whether during or after
the Executive's employment with the Company, to divulge to any other entity or
person any confidential information acquired by the Executive concerning the
Company's or its affiliates' financial affairs or business processes or
methods or their research, development or marketing programs or plans, any
other of its or their trade secrets, any information regarding personal
matters of any directors, officers, employees or agents of the Company or its
affiliates or their respective family members, or any information concerning
the circumstances of the Executive's employment and any termination of the
Executive's employment with the Company or any information regarding
discussions related to any of the foregoing. The foregoing prohibitions shall
include, without limitation, directly or indirectly publishing (or causing,
participating in, assisting or providing any statement, opinion or information
in connection with the publication of) any diary, memoir, letter, story,
photograph, interview, article, essay, account or description (whether
fictionalized or not) concerning any of the foregoing, publication being
deemed to include any presentation or reproduction of any written, verbal or
visual material in any communication medium, including any book, magazine,
newspaper, theatrical production or movie, or television or radio programming
or commercial. In the event that the Executive is requested or required to
make disclosure of information subject to this Section 5.1.1 under any court
order, subpoena or other judicial process, the Executive will promptly notify
the Company, take all reasonable steps requested by the Company to defend
against the compulsory disclosure and permit the Company to control with
counsel of its choice any proceeding relating to the compulsory disclosure.
The Executive acknowledges that all information the disclosure of which is
prohibited by this section is of a confidential and proprietary character and
of great value to the Company.
5.1.2 To deliver promptly to the Company on termination of the
Executive's employment by the Company, or at any time the Company may so
request, all memoranda, notes, records, reports, manuals, drawings, blueprints
and other documents (and all copies thereof) relating to the Company's
business and all property associated therewith, which the Executive may then
possess or have under the Executive's control.
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5.2 The Executive shall in all respects fully comply with the
terms of the Employee Agreement as to Confidentiality and Non-Competition
referred to in such Executive Severance Plan (whether or not the Executive is
a signatory thereof) with the same effect as of the same were set forth herein
in full.
5.3 If the Executive commits a breach of any of the provisions
of Sections 5.1 or 5.2 hereof, the Company shall have the following rights and
remedies:
5.3.1 The right and remedy to have the provisions of this
Agreement specifically enforced by any court having equity jurisdiction, it
being acknowledged and agreed that any such breach or threatened breach will
cause irreparable injury to the Company and that money damages and
disgorgement of profits will not provide an adequate remedy to the Company;
and
5.3.2 The right and remedy to require the Executive to account
for and pay over to the Company all compensation, profits, monies, accruals,
increments or other benefits (collectively "Benefits") derived or received by
the Executive as the result of any transactions constituting a breach of any
of the provisions of Sections 5.1 or 5.2 hereof, and the Executive hereby
agrees to account for and pay over such Benefits to the Company. In addition,
if the Executive attempts or threatens to commit a breach of any of the
provisions of Sections 5.1 or 5.2, the Executive consents to the Company
obtaining a preliminary and a permanent injunction in any court having equity
jurisdiction against the Executive committing the attempted or threatened
breach. Each of the rights and remedies enumerated above shall be independent
of the other, and shall be severally enforceable, and all of such rights and
remedies shall be in addition to, and not in lieu of, any other rights and
remedies available to the Company under law or in equity.
5.4 If any of the covenants contained in Sections 5.1, 5.2 or
5.3, or any part thereof, hereafter are construed to be invalid or
unenforceable, the same shall not affect the remainder of the covenant or
covenants, which shall be given full effect, without regard to the invalid
portions.
5.5 If any of the covenants contained in Sections 5.1 or 5.2,
or any part thereof, are held to be unenforceable because of the duration of
such provision or the area covered thereby, the parties agree that the court
making such determination shall have the power to reduce the duration and/or
area of such provision so as to be enforceable to the maximum extent permitted
by applicable law and, in its reduced form, said provision shall then be
enforceable.
5.6 The parties hereto intend to and hereby confer
jurisdiction to enforce the covenants contained in Sections 5.1, 5.2 and 5.3
upon the courts of any state within the geographical scope of such covenants.
In the event that the courts of any one or more of such states shall hold such
covenants wholly unenforceable by reason of the breadth of
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such covenants or otherwise, it is the intention of the parties hereto that
such determination not bar or in any way affect the Company's right to the
relief provided above in the courts of any other states within the
geographical scope of such covenants as to breaches of such covenants in such
other respective jurisdictions, the above covenants as they relate to each
state being for this purpose severable into diverse and independent covenants.
5.7 Any termination of the Term or this Agreement shall have
no effect on the continuing operation of this Section 5.
6. Inventions and Patents.
6.1 The Executive agrees that all processes, technologies and
inventions (collectively, "Inventions"), including new contributions,
improvements, ideas and discoveries, whether patentable or not, conceived,
developed, invented or made by him during the Term shall belong to the
Company, provided that such Inventions grew out of the Executive's work with
the Company or any of its subsidiaries or affiliates, are related in any
manner to the business (commercial or experimental) of the Company or any of
its subsidiaries or affiliates or are conceived or made on the Company's time
or with the use of the Company's facilities or materials. The Executive shall
further: (a) promptly disclose such Inventions to the Company; (b) assign to
the Company, without additional compensation, all patent and other rights to
such Inventions for the United States and foreign countries; (c) sign all
papers necessary to carry out the foregoing; and (d) give testimony in support
of the Executive's inventorship.
6.2 If any Invention is described in a patent application or
is disclosed to third parties, directly or indirectly, by the Executive within
two years after the termination of the Executive's employment by the Company,
it is to be presumed that the Invention was conceived or made during the Term.
6.3 The Executive agrees that the Executive will not assert
any rights to any Invention as having been made or acquired by the Executive
prior to the date of this Agreement, except for Inventions, if any, disclosed
to the Company in writing prior to the date hereof.
7. Intellectual Property.
Notwithstanding and without limitation of Section 6, the Company
shall be the sole owner of all the products and proceeds of the Executive's
services hereunder, including, but not limited to, all materials, ideas,
concepts, formats, suggestions, developments, arrangements, packages, programs
and other intellectual properties that the Executive may acquire, obtain,
develop or create in connection with or during the Term, free and clear of any
claims by the Executive (or anyone claiming under the Executive) of any kind
or
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character whatsoever (other than the Executive's right to receive payments
hereunder). The Executive shall, at the request of the Company, execute such
assignments, certificates or other instruments as the Company may from time to
time deem necessary or desirable to evidence, establish, maintain, perfect,
protect, enforce or defend its right, title or interest in or to any such
properties.
8. Indemnification.
The Company will indemnify the Executive, to the maximum extent
permitted by applicable law, against all costs, charges and expenses incurred
or sustained by the Executive in connection with any action, suit or
proceeding to which the Executive may be made a party, brought by any
shareholder of the Company directly or derivatively or by any third party by
reason of any act or omission of the Executive as an officer, director or
employee of the Company or of any subsidiary or affiliate of the Company.
9. Notices.
All notices, requests, consents and other communications required
or permitted to be given hereunder shall be in writing and shall be deemed to
have been duly given if delivered personally, sent by overnight courier or
mailed first class, postage prepaid, by registered or certified mail (notices
mailed shall be deemed to have been given on the date mailed), as follows (or
to such other address as either party shall designate by notice in writing to
the other in accordance herewith):
If to the Company, to:
Revlon Consumer Products Corporation
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxx III
Senior Vice President and
General Counsel
If to the Executive, to her principal residence as reflected in the
records of the Company.
10. General.
10.1 This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of New York applicable to
agreements made between residents thereof and to be performed entirely in New
York.
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10.2 The section headings contained herein are for reference
purposes only and shall not in any way affect the meaning or interpretation of
this Agreement.
10.3 This Agreement sets forth the entire agreement and
understanding of the parties relating to the subject matter hereof, and
supersedes all prior agreements, arrangements and understandings, written or
oral, relating to the subject matter hereof, including without limitation the
Employment Agreement among the parties dated as of January 1, 1996. No
representation, promise or inducement has been made by either party that is
not embodied in this Agreement, and neither party shall be bound by or liable
for any alleged representation, promise or inducement not so set forth.
10.4 This Agreement, and the Executive's rights and
obligations hereunder, may not be assigned by the Executive. The Company may
assign its rights, together with its obligations, hereunder (i) to any
affiliate or (ii) to third parties in connection with any sale, transfer or
other disposition of all or substantially all of any business or assets in
which the Executive's services are then substantially involved; in any event
the obligations of the Company hereunder shall be binding on its successors or
assigns, whether by merger, consolidation or acquisition of all or
substantially all of such business or assets.
10.5 This Agreement may be amended, modified, superseded,
canceled, renewed or extended and the terms or covenants hereof may be waived,
only by a written instrument executed by both of the parties hereto, or in the
case of a waiver, by the party waiving compliance. The failure of either party
at any time or times to require performance of any provision hereof shall in
no manner affect the right at a later time to enforce the same. No waiver by
either party of the breach of any term or covenant contained in this
Agreement, whether by conduct or otherwise, in any one or more instances,
shall be deemed to be, or construed as, a further or continuing waiver of any
such breach, or a waiver of the breach of any other term or covenant contained
in this Agreement.
10.6 This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
11. Subsidiaries and Affiliates.
11.1 As used herein, the term "subsidiary" shall mean any
corporation or other business entity controlled directly or indirectly by the
corporation or other business
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entity in question, and the term "affiliate" shall mean and include any
corporation or other business entity directly or indirectly controlling,
controlled by or under common control with the corporation or other business
entity in question.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
REVLON CONSUMER PRODUCTS CORPORATION
By: XXXXX X. XXXXX
---------------------------
Xxxxx X. Xxxxx
XXXXXX XXXXXXX
---------------------------
Xxxxxx Xxxxxxx
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