EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (the "Agreement"), dated as of February
1, 2002, by and between Candie's, Inc., a Delaware corporation (the "Company"),
and Xxxx Xxxx (the "Executive").
W I T N E S S E T H:
WHEREAS, the Executive possesses unique personal knowledge,
experience and expertise concerning the business and operations conducted by the
Company; and
WHEREAS, the Company desires to continue to employ the
Executive beyond the term of the current employment agreement between the
Executive and the Company, and the Executive desires to continue to be employed
by the Company, upon the terms and subject to the conditions set forth this
Agreement.
NOW, THEREFORE, in consideration of the covenants and
agreements hereinafter set forth and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. EMPLOYMENT AND DUTIES
1.1. Term of Employment. The Executive's employment under this Agreement shall
commence on February 1, 2002 (the "Start Date") and shall continue until the
third anniversary of the Start Date, unless earlier terminated or canceled as
provided in this Agreement (the "Term").
1.2. General.
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1.2.1. During the Term, the Executive shall have the title of the President and
Chief Executive Officer of the Company and shall have such duties as may be
from time to time delegated to him by the Board of Directors of the Company
(the "Board"). The Executive shall faithfully and diligently discharge his
duties hereunder and use his best efforts to implement the policies established
by the Board. No other officer will be appointed with authority over the
executive or business affairs of the Company and the Executive's
responsibilities shall include, among other things, the power to enter into
banking relationships; to hire and fire employees; to order merchandise; to
engage in advertising and promotion; and to employ outside consultants and
professionals.
1.2.2. The Executive shall devote all of his business time, attention, knowledge
and skills faithfully, diligently and to the best of his ability, in furtherance
of the business and activities of the Company; provided, however, that nothing
in this Agreement shall preclude the Executive from devoting reasonable periods
of time required for:
(i) serving as a director or member of a committee of any organization or
corporation involving no conflict of interest with the interests of the
Company and with the written consent of the Company, which consent
shall not be unreasonably withheld;
(ii) delivering lectures, fulfilling speaking engagements, and any writing
of publication relating to his area of expertise;
(iii) engaging in professional organization and program activities; and
(iv) managing his personal investments;
provided that such activities do not materially interfere with the due
performance of his duties and responsibilities under this Agreement as
determined by the Board.
1.2.3. During the Term, the Board shall vote to recommend the election of the
Executive by the Company's stockholders as a director, and the Executive shall
act as Chairman of the Board at all meetings thereof.
1.3. Reimbursement of Expenses. The Company shall pay to the Executive the
reasonable expenses incurred by him in the performance of his duties hereunder,
including, without limitation, those incurred in connection with the use of an
automobile, business related travel or entertainment, or, if such expenses are
paid directly by the Executive, the Company shall promptly reimburse him for
such payments, provided that the Executive properly accounts for such expenses
in accordance with the Company's policy.
2. COMPENSATION
2.1. Base Salary. During the Term, the Executive shall be entitled to receive a
base salary ("Base Salary") at a rate of five hundred thousand dollars
($500,000.00) per annum, payable in arrears in equal installments not less
frequently than on a bi-monthly basis in accordance with the payroll practices
of the Company, with such increases as may be determined by the Board from time
to time.
2.2. Bonus.
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2.2.1. In additional to the Base Salary, the Executive shall receive in each
fiscal year of the Company during the Term that the Company meets at least
662/3% of its net income target for such fiscal year as determined by the Board
(subject to subsection 2.2.2 below) (the "Target"), as incentive compensation,
an amount equal to the product of (x) the Base Salary and (y) a fraction, the
numerator of which is the Company's actual net income for such fiscal year (as
set forth in the Company's audited financial statements), and the denominator of
which is the Target for such fiscal year (the "Bonus"); provided that the
Executive is employed by the Company during the entire fiscal year. The Bonus,
if applicable, shall be due and payable by the Company to the Executive within
thirty (30) days after the filing by the Company of its Annual Report on Form
10-K with the Securities and Exchange Commission with respect to such fiscal
year. Anything contained in this Section 2.2 to the contrary notwithstanding, in
the event that the Executive's employment hereunder is terminated by the Company
without Cause or by the Executive for Good Reason (as such terms are defined in
Section 5.1 hereof) prior to the end of a fiscal year and the Executive would
have been entitled to a Bonus under this Section 2.2 for such fiscal year but
for such termination, the Executive shall be entitled to a pro rata portion of
the Bonus that would have been payable but for such termination through the Date
of Termination (as defined in Section 5.3 hereof).
2.2.2. The Target for the Company's fiscal year ending January 31, 2003 shall be
$9,200,000. The Target for each fiscal year of the Company thereafter shall be
determined by the Board and provided in writing to the Executive at least ten
days prior to the commencement of each such fiscal year of the Company.
2.3. Stock Options. In addition to the Base Salary and the Bonus, the Executive
shall receive, as incentive compensation, options ("Options") to purchase up to
an aggregate of 600,000 shares (the "Shares") of common stock of the Company,
pursuant to and upon the terms and conditions set forth in the Company's 2000
Stock Option Plan ("Plan"). The Options shall vest and become exercisable at any
time during the ten year period commencing upon the date of grant, subject to
earlier termination as provided in the Plan and the option agreement between the
Company and the Executive, with respect to (i) one third of the number of Shares
covered thereby on the first anniversary of the Start Date and (ii) one third of
the number of Shares covered thereby on each of the second and third
anniversaries of the Start Date, at an exercise price per share equal to the
last sales price for the Company's common stock on the date hereof.
2.4. Additional Compensation. In addition to the Base Salary, the Bonus and the
Options, the Executive shall be entitled to receive such other cash bonuses and
such other compensation in the form of stock, stock options or other property or
rights as may from time to time be awarded him by the Board during or in respect
of his employment hereunder.
2.5. Payment Upon Sale of the Company. In the event of the sale of all or
substantially all of the assets or capital stock of the Company (as the case may
be, a "Sale") for an aggregate sale price ("Sale Price") of at least $5 per
share (subject to appropriate adjustment by the Board in the event of any stock
split, dividend or similar division of shares of the Company's common stock or
reverse split or similar combination of such common stock) of the Company's
common stock on a fully diluted basis at the time of the closing of the Sale,
the Company shall pay to the Executive an amount equal to 5% of the Sale Price
(the "Payout"). In the event that the Sale involves a sale of the Company's
assets, the Sale Price shall be determined by dividing the aggregate
consideration received by the Company in the Sale by the total number of
outstanding shares of the Company's common stock, on a fully-diluted basis, at
the time of the closing of the Sale.
For purposes of the foregoing, the following shall be
considered to be part of the Sale Price: contingent future payments (based upon
future profits or otherwise) paid to the Company or to all of its stockholders;
payments for noncompete covenants paid to the Company or to all of its
stockholders; and the value of all assumed liabilities (including, without
limitation, indebtedness for borrowed money, pension liabilities and
guarantees). In the event that the Sale Price is paid in whole or in part in the
form of securities, the value of such securities, for purposes of calculating
the Payout, shall be deemed to be the fair market value thereof on the day prior
to the consummation of the Sale as determined by the Board; provided, however,
that if such securities consist of securities for which there is an existing
public trading market (whether or not such securities would be deemed to be
"restricted stock" within the meaning of Rule 144(a)(3) of the General Rules and
Regulations promulgated under the Securities Act of 1933, as amended), the fair
market value thereof shall be deemed to be the average of the last sales prices
for such securities on the five (5) trading days ending five (5) days prior to
the consummation of the Sale.
The Payout shall be paid by the Company to the Executive, in
full, within fifteen (15) days after the consummation of the Sale, and shall be
payable, at the option of the Company, in cash or in kind (in the event that the
Sale Price includes consideration other than cash). If the Sale Price is
increased by contingent payments, or if a portion of the Sale Price is paid into
escrow, the portion of the Payout relating thereto shall be calculated and paid
when and as such contingent payments are made, or when such portion of the
proceeds is released from escrow, as the case may be. The determination of the
amount of the Payout shall be made by the Board or its designee whose decision
shall be final.
3. PLACE OF PERFORMANCE. In connection with his employment by the Company, the
Executive shall be based at the Company's principal executive offices in
Valhalla, New York, or at the Company's offices in New York, New York, subject
to the mutual agreement of the Executive and the Company to relocate him to
another office of the Company. Subject to the foregoing, in connection with any
relocation or transfer of the Executive outside of the greater New York
metropolitan area, the Company will promptly pay (or reimburse the Executive
for) all reasonable moving and moving-related expenses (including any losses
incurred as a result of the sale of the Executive's personal residence) incurred
by the Executive as a consequence of a change of his principal residence in
connection with any such relocation or transfer.
4. EMPLOYEE BENEFITS
4.1. Benefit Plans. The Executive shall, during the Term, be included to the
extent eligible thereunder in all employee benefit plans, programs or
arrangements of general application (including, without limitation, any plans,
programs or arrangements providing for retirement benefits, options and other
equity-based incentive compensation, profit sharing, bonuses, disability
benefits, health and life insurance, or vacation and paid holidays) which shall
be established by the Company or any affiliate of the Company, for, or made
available to, their respective senior executives. During the Term, the benefits
described in this paragraph 4 may only be reduced as a result of a general
reduction for senior executives.
4.2. Vacation. The Executive shall be entitled to not less than four
(4) weeks vacation at full pay for each year during the Term. Such vacation
may be taken in the Executive's discretion, and at such time or times
as are not inconsistent with the reasonable business needs of the Company.
4.3. Life Insurance Coverage. The Company shall use its best efforts to obtain
and maintain in full force and effect during the Term life insurance covering
the life of the Executive for the benefit of his designee in the amount of
$3,000,000, $4,000,000 and $5,000,000, respectively, for the Company's fiscal
years ending on January 31, 2003, 2004 and 2005, respectively.
5. TERMINATION OF EMPLOYMENT
5.1. General. The Executive's employment under this Agreement may be
terminated without any breach of this Agreement only on the following
circumstances:
5.1.1. Death. The Executive's employment under this Agreement shall terminate
upon his death.
5.1.2. Disability. If, as a result of the Executive's Disability (as defined
below), the Executive shall have been absent from his duties under this
Agreement for sixty (60) consecutive days, the Company may terminate the
Executive's upon thirty (30) days prior written notice; provided that the
Executive has not returned to full time performance of his duties during such
thirty (30) day period. For purposes hereof, "Disability" shall mean that the
Executive is unable to perform his normal and customary duties hereunder as a
result of physical or mental illness.
5.1.3. Good Reason. The Executive may terminate his employment for Good
Reason at any time. For purposes of this Agreement, "Good Reason" shall mean:
(i) the failure by the Company to comply with its material obligations and
agreements contained in this Agreement;
(ii) a material diminution of the responsibilities or title of the Executive
with the Company without the express written consent of the Executive;
(iii)a reduction by the Company in the Base Salary as in effect on the date
hereof, or as the same may be increased from time to time without the
express written consent of the Executive; or
(iv) the re-location of the Executive to an office outside of the greater New
York metropolitan area, unless mutually agreed to;
provided, however, that the Executive shall have provided the Company with
written notice that such actions are occurring and the Company has been afforded
a reasonable opportunity of at least thirty (30) days to cure same.
5.1.4. Cause. The Company may terminate the Executive's employment under this
Agreement for Cause. Termination for "Cause" shall mean termination of the
Executive's employment because of the occurrence of any of the following as
determined by the Board:
(i) the willful and continued failure by the Executive to substantially perform
his obligations under this Agreement (other than any such failure resulting
from the Executive's incapacity due to physical or mental illness);
provided, however, that the Company shall have provided the Executive with
written notice that such actions are occurring and the Executive has been
afforded a reasonable opportunity of at least thirty (30) days to cure
same, or
(ii) the indictment of the Executive for a felony or other crime involving moral
turpitude or dishonesty; or
(iii)the willful engaging in misconduct (including theft, fraud, embezzlement,
and securities law violations) which is injurious to the Company,
monetarily, or otherwise. For purposes of this Section 5.1.4(iii), no act,
or failure to act, on the part of the Executive shall be considered
"willful" unless done, or omitted to be done, by him in bad faith and
without reasonable belief that his action or omission was in the best
interest of the Company.
5.2. Notice of Termination. Any termination of the Executive's employment by the
Company or by the Executive (other than termination by reason of the Executive's
death) shall be communicated by written Notice of Termination to the other party
of this Agreement. For purposes of this Agreement, a "Notice of Termination"
shall mean a notice which shall indicate the specific termination provision in
this Agreement relied upon and shall set forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated.
5.3. Date of Termination. The "Date of Termination" shall mean (a) if the
Executive's employment is terminated by his death, the date of his death, (b) if
the Executive's employment is terminated pursuant to subsection 5.1.2 above,
thirty (30) days after Notice of Termination is given (provided that the
Executive shall not have returned to the performance of his duties on a
full-time basis during such thirty (30) day period), (c) if the Executive's
employment is terminated pursuant to subsections 5.1.3 or 5.1.4 above, the date
specified in the Notice of Termination after the expiration of any applicable
cure periods, and (d) if the Executive's employment is terminated for any other
reason, the date on which a Notice of Termination is given; provided that if
within thirty (30) days after any Notice of Termination is given the party or
parties receiving such Notice of Termination notifies the other party or parties
that a dispute exists concerning such termination, the Date of Termination shall
be the date on which the dispute is finally determined by a binding and final
arbitration award or by a final judgment, order or decree of a court of
competent jurisdiction (the time for appeal therefrom having expired and no
appeal having been perfected).
5.4. Compensation Upon Termination.
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5.4.1. Termination for Cause. If the Executive's employment shall be terminated
for Cause, the Company shall pay the Executive his Base Salary through the Date
of Termination, at the rate in effect at the time Notice of Termination is
given, and all expenses and accrued benefits arising prior to such termination
which are payable to the Executive pursuant to this Agreement through the Date
of Termination and the Company shall have no further obligation with respect to
this Agreement.
5.4.2. Termination without Cause or For Good Reason. Subject to the provisions
of subsection 5.4.3 hereof, if, prior to the expiration of the Term, the
Executive's employment hereunder is terminated by the Executive for Good Reason
or by the Company without Cause (other than a termination by reason of
Disability), the Company shall pay to the Executive all expenses and accrued
benefits arising prior to such termination which are payable to the Executive
pursuant to this Agreement through the Date of Termination and the Company shall
continue to pay the Executive his Base Salary as then in effect for the greater
of (i) the remainder of the original Term or (ii) a period of one year (1) year
from the Date of Termination (such period being referred to hereinafter as the
"Severance Period"), payable in monthly installments. In addition, during the
Severance Period, the Executive shall be entitled to continue to participate in
all employee benefit plans that the Company provides (and continues to provide)
generally to its senior executives. The Company shall also pay all indemnity
payments and all legal fees and expenses incurred by the Executive as a result
of such termination (including all such fees and expenses, if any, incurred in
contesting or disputing any such termination or in seeking to obtain or enforce
any right or benefit provided by this Agreement.
5.4.3. Death During Severance Period. In the event of the Executive's death
during the Severance Period, payments of Base Salary under this Section 5.4 and
payments under the Company's employee benefit plan(s) shall continue to be made
in accordance with their terms during the remainder of the Severance Period to
the beneficiary designated in writing for such purpose by the Executive or, if
no such beneficiary is specifically designated, to the Executive's estate.
5.4.4. Termination Following Change in Control.
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(i) Anything contained herein to the contrary notwithstanding, in the event
the Executive's employment hereunder is terminated within twelve (12) months
following a Change in Control (as defined below) by the Company without Cause,
or any joint venturer or partner of the Company existing as of the date hereof,
or by the Executive with Good Reason, then the Company shall pay to the
Executive in complete satisfaction of its obligations under this Agreement, as
severance pay and as liquidated damages (because actual damages are difficult to
ascertain), in a lump sum, in cash, within fifteen (15) days after the Date of
Termination, an amount equal to $100 less than three times the Executive's
"annualized includable compensation for the base period" (as defined in Section
280G of the Internal Revenue Code of 1986); provided, however, that if such lump
sum severance payment, either alone or together with other payments or benefits,
either cash or non-cash, that the Executive has the right to receive from the
Company, including, but not limited to, accelerated vesting or payment of any
deferred compensation, options, stock appreciation rights or any benefits
payable to the Executive under any plan for the benefit of employees, which
would constitute an "excess parachute payment" (as defined in Section 280G of
the Internal Revenue Code of 1986), then such lump sum severance payment or
other benefit shall be reduced to the largest amount that will not result in
receipt by the Executive of a parachute payment. The determination of the amount
of the payment described in this subsection shall be made by the Company's
independent auditors at the sole expense of the Company. For purposes of
clarification the value of any options described above will be determined by the
Company's independent auditors using a Black-Scholes valuation methodology.
For purposes of this Agreement, a "Change in Control" shall be deemed to
occur (i) when any "person" as defined in Section 3(a)(9) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and as used in Section
13(d) and 14(d) thereof, including a "group" as defined in Section 13(d) of the
Exchange Act, but excluding the Executive, the Company or any subsidiary or any
affiliate of the Company or any employee benefit plan sponsored or maintained by
the Company or any subsidiary of the Company (including any trustee of such plan
acting as trustee), becomes the "beneficial owner" (as defined in Rule 13(d)(3)
under the Exchange Act) of securities of the Company representing 15% or more of
the combined voting power of the Company's then outstanding securities; or (ii)
when, during any period of twenty-four (24) consecutive months, the individuals
who, at the beginning of such period, constitute the Board of Directors (the
"Incumbent Directors") cease for any reason other than death to constitute at
least a majority thereof; provided, however, that a director who was not a
director at the beginning of such twenty-four (24) month period shall be deemed
to have satisfied such twenty-four (24) month requirement (and be an Incumbent
Director) if such director was elected by, or on the recommendation of or with
the approval of, at least two-thirds (2/3) of the directors who then qualified
as Incumbent Directors either actually (because they were directors at the
beginning of such twenty-four (24) month period) or through the operation of
this proviso; or (iii) the occurrence of a transaction requiring stockholder
approval for the acquisition of the Company by an entity other than the Company
or a subsidiary or an affiliated company of the Company through purchase of
assets, or by merger, or otherwise.
(ii) If within twelve (12) months after the occurrence of a Change in Control,
the Company shall terminate the Executive's employment without Cause or the
Executive terminates his employment for Good Reason, then notwithstanding the
vesting and exercisability schedule in any stock option agreement between the
Company and the Executive, all unvested stock options granted by the Company to
the Executive pursuant to such agreement shall immediately vest and become
exercisable and shall remain exercisable for not less than 180 days thereafter.
5.4.5. Termination upon Death or Retirement. In the event of the termination of
the Executive's employment by reason of death or retirement, the Company shall
pay the Executive his Base Salary through the Date of Termination, at the rate
then in effect, and all expenses or accrued benefits arising prior to such
termination which are payable to the Executive pursuant to this Agreement
through the Date of Termination. In addition, the Executive and/or his
beneficiaries shall be entitled to such other benefits as shall be determined in
accordance with the benefit plans maintained by the Company, including, without
limitation, any benefits to which they are entitled under the life insurance
policy provided for in Section 4.3 hereof.
5.4.6. Termination upon Disability. In the event of the termination of the
Executive's employment by reason of Disability in accordance with the provisions
of Section 5.1.2 hereof, the Company shall pay to the Executive a lump sum cash
payment in an amount equal to the present value of the Base Salary that would
have been payable to the Executive during the remainder of the original Term had
the Agreement not been so terminated, together with all expenses and accrued
benefits arising prior to such termination which are payable to the Executive
pursuant to this Agreement through the Date of Termination. In addition, the
Executive and/or his beneficiaries shall be entitled to such other benefits as
shall be determined in accordance with the benefit plans maintained by the
Company.
5.4.7. The Executive shall not be required to mitigate the amount of any payment
provided for in this Section 5.4 by seeking other employment or otherwise, nor
shall the amount of any payment provided for in this Section 5.4 be reduced by
any compensation earned by the Executive as the result of employment by another
employer or business or by profits earned by the Executive from any other source
at any time before and after the Date of Termination.
6. INSURABILITY; RIGHT TO INSURE
During the continuance of the Executive's employment
hereunder, the Company shall have the right to maintain key man life insurance
in its own name covering the Executive's life in such amount as shall be
determined by the Company, for a term ending on the termination or expiration of
this Agreement. The Executive shall aid in the procuring of such insurance by
submitting to the required medical examinations, if any, and by filling out,
executing and delivering such applications and other instrument in writing as
may be reasonably required by an insurance company or companies to which
application or applications for insurance may be made by or for the Company.
7. CONFIDENTIALITY; NONCOMPETITION; NONSOLICITATION; NONDISPARAGEMENT
7.1. The Company and the Executive acknowledge that the services to be performed
by the Executive under this Agreement are unique and extraordinary and, as a
result of such employment, the Executive shall be in possession of confidential
information relating to the business practices of the Company. The term
"confidential information" shall mean any and all information (oral and written)
relating to the Company or any of its affiliates, or any of their respective
activities, other than such information which (i) can be shown by the Executive
to be in the public domain (such information not being deemed to be in the
public domain merely because it is embraced by more general information which is
in the public domain) other than as the result of breach of the provisions of
this paragraph 7 or (ii) the Executive is required to disclose under any
applicable laws, regulations or directives of any government agency, tribunal or
authority having jurisdiction in the matter or under subpoena or other process
of law. The Executive shall not, during the Term and for a period of two (2)
years thereafter, except as may be required in the course of the performance of
his duties hereunder, directly or indirectly, use, communicate, disclose or
disseminate to any person, firm or corporation any confidential information
regarding the clients, customers or business practices of the Company acquired
by the Executive, without the prior written consent of the Company; provided,
however, that the Executive understands that Executive shall be prohibited from
misappropriating any trade secret at any time during or after the Term.
7.2. Upon the termination of the Executive's employment for any reason
whatsoever, all documents, records, notebooks, equipment, price lists,
specifications, programs, customer and prospective customer lists and other
materials which refer or relate to any aspect of the business of the Company
which are in the possession of the Executive, including all copies thereof,
shall be promptly returned to the Company.
7.3. The Executive hereby agrees that he shall not, during the Term, and, in the
event that the Executive's employment hereunder is terminated by the Company for
Cause or by the Executive without Good Reason, for a period of two years after
the date of such termination, directly or indirectly, within any county (or
adjacent county) in any State within a fifty (50) mile radius of the location of
any of the Company's offices, engage, have an interest in or render any services
to any business (whether as owner, manager, operator, licensor, licensee,
lender, partner, stockholder, joint venturer, employee, consultant or otherwise)
competitive with the business activities conducted by the Company, its
subsidiaries, or affiliates during the Term. Notwithstanding the foregoing,
nothing herein shall prevent the Executive from owning stock in a publicly
traded corporation whose activities compete with those of the Company's,
provided that such stock holdings are not greater than five percent (5%) of such
corporation.
7.4. The Executive shall not, during the Term, and, in the event that the
Executive's employment hereunder is terminated by the Company for Cause or by
the Executive without Good Reason, for a period of two years after the date of
such termination, directly or indirectly, take any action which constitutes an
interference with or a disruption of any of the Company's business activities
including, without limitation, the solicitations of the Company's customers, or
persons listed on the personnel lists of the Company.
7.5. For purposes of clarification, but not of limitation, the Executive hereby
acknowledges and agrees that the provisions of Sections 7.3 and 7.4 above shall
serve as a prohibition against him from, during the period referred to therein,
directly or indirectly, hiring, offering to hire, enticing, soliciting or in any
other manner persuading or attempting to persuade any officer, employee, agent,
lessor, lessee, licensor, licensee or customer of the Company (but only those
suppliers existing during the time of the Executive's employment by the Company,
or at the termination of his employment), to discontinue or alter his, her or
its relationship with the Company.
7.6. At no time during or after the Term shall either party hereto, directly or
indirectly, disparage the commercial, business, professional or financial, as
the case may be, reputation of the other party.
7.7. Without intending to limit the remedies available to the Company, the
Executive acknowledges that a breach of any of the covenants contained in this
paragraph 7 may result in material and irreparable injury to the Company, or its
affiliates or subsidiaries, for which there is no adequate remedy at law, that
it will not be possible to measure damages for such injuries precisely and that,
in the event of such a breach or threat the Company shall be entitled to seek a
temporary restraining order and/or a preliminary or permanent injunction
restraining the Executive from engaging in activities prohibited by this
paragraph 7 or such other relief as may be required specifically to enforce any
of the covenants in this paragraph 7. If for any reason it is held that the
restrictions under this paragraph 7 are not reasonable or that consideration
therefor is inadequate, such restrictions shall be interpreted or modified to
include as much of the duration and scope identified in this paragraph as will
render such restrictions valid and enforceable.
8. RIGHTS OF INDEMNIFICATION
8.1. The Company shall indemnify the Executive to the fullest extent permitted
by the General Corporation Law of the State of Delaware, as amended from time to
time, for all amounts (including without limitation, judgments, fines,
settlement payments, expenses and attorney's fees) incurred or paid by the
Executive in connection with any action, suit, investigation or proceeding
arising out of or relating to the performance by the Executive of services for,
or the acting by the Executive as a director, officer or employee of the
Company, or any other person or enterprise at the Company's request.
8.2. The Company shall use its best efforts to obtain and maintain in full force
and effect during the Term, directors' and officers' liability insurance
policies providing full and adequate protection to the Executive for his
capacities, provided that the Board shall have no obligation to purchase such
insurance if, in its opinion, coverage is available only on unreasonable terms.
9. MISCELLANEOUS
9.1. Notices. All notices or communications hereunder shall be in writing,
addressed as follows:
To the Company: Candie's, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxx Xxxxx
Senior Vice President and General Counsel
with a copy to:
Blank Rome Xxxxxx Xxxxxxxxxx LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxx, Esq.
To the Executive: Xxxx Xxxx
000 Xxxx 00xx Xxxxxx
Xxx 00X
Xxx Xxxx, XX 00000
All such notices shall be conclusively deemed to be received
and shall be effective (i) if sent by hand delivery, upon receipt, (ii) if sent
by telecopy or facsimile transmission, upon confirmation of receipt by the
sender of such transmission, (iii) if sent by overnight courier, one business
day after being sent by overnight courier, or (iv) if sent by registered or
certified mail, postage prepaid, return receipt requested, on the fifth day
after the day on which such notice is mailed.
9.2. Severability. Each provision of this Agreement shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be prohibited by or invalid under applicable law,
such provision will be ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Agreement.
9.3. Binding Effect; Benefits. Executive may not delegate his duties or
assign his rights hereunder. This Agreement shall inure to the benefit of, and
be binding upon, the parties hereto and their respective heirs, legal
representatives, successors and permitted assigns.
9.4. Entire Agreement. This Agreement represents the entire agreement of the
parties and shall supersede any and all previous contracts, arrangements or
understandings between the Company and the Executive, including, without
limitation, that certain Employment Agreement dated February 23, 1993, as
amended, between the Company and the Executive. This Agreement may be amended at
any time by mutual written agreement of the parties hereto. In the case of any
conflict between any express term of this Agreement and any statement contained
in any employment manual, memo or rule of general applicability of the Company,
this Agreement shall control.
9.5. Withholding. The payment of any amount pursuant to this Agreement
shall subject to applicable withholding and payroll taxes, and such other
deductions as may be required under the Company's employee benefit plans,if any.
9.6. Governing Law. This Agreement and the performance of the parties hereunder
shall be governed by the internal laws (and not the law of conflicts) of the
State of New York. Any claim or controversy arising out of or in connection with
this Agreement, or the breach thereof, shall be adjudicated exclusively by the
Supreme Court, New York County, State of New York, or by a federal court sitting
in Manhattan in New York City, State of New York. The parties hereto agree to
the personal jurisdiction of such courts and agree to accept process by regular
mail in connection with any such dispute.
9.7. Legal Fees and Court Costs. In the event that any action, suit or other
proceeding in law or in equity is brought to enforce the provisions of this
Agreement, and such action results in the award of a judgment for money damages
or in the granting of any injunction in favor of the Company, all expenses
(including reasonable attorneys' fees) of the Company in such action, suit or
other proceeding shall be paid by the Executive. In the event that any action,
suit or other proceeding in law or in equity is brought to enforce the
provisions of this Agreement, and such action results in the award of a judgment
for money damages or in the granting of any injunction in favor of the
Executive, all expenses (including reasonable attorneys' fees and travel
expenses) of the Executive in such action, suit or other proceeding shall be
paid by the Company.
IN WITNESS WHEREOF, the Company has caused this Agreement to
be duly executed and the Executive has hereunto set his hand, as of the day and
year first above written,
THE COMPANY:
CANDIE'S, INC.
By:
-----------------------
EXECUTIVE
Xxxx Xxxx
