EXHIBIT 10.27
MOVIE STAR, INC.
0000 XXXXXXXX
XXX XXXX, XXX XXXX 00000
As of November 28, 2006
Xxxx Xxxxxxxxx
Re: Amended and Restated Employment Agreement dated as of October 13, 2006
Dear Xxxx:
We refer you to your Amended and Restated Employment Agreement, dated as of
October 13, 2006 ("Employment Agreement"), with Movie Star, Inc. ("Company").
This letter will serve to amend your Employment Agreement as set forth below,
effective as of November 28, 2006. Except as herein amended, all other
provisions of the Employment Agreement shall remain in full force and effect.
1. The last sentence of Section 2 (Term) shall be deleted in its entirety
and replaced with the following:
"Unless the Company and Executive have otherwise agreed in writing, if
Executive continues to work for the Company after the expiration of the
Term, his employment thereafter shall be under the same terms and
conditions provided for in this Agreement, except that his employment will
be on an "at will" basis and the provisions of Section 4.4 and Section
4.6(d)(i), (ii) and (vi) shall no longer be in effect."
2. Section 3.2 shall be deleted in its entirety and replaced with the
following:
"3.2 Bonus. In addition to Base Salary, for each of the fiscal years
ending June 30, 2007, 2008 and 2009, Executive shall be paid a bonus
("Bonus") in accordance with the terms of the Company's senior executive
incentive compensation pool as adopted by the Compensation Committee of the
Board of Directors in September 1998 ("1998 Incentive Plan"), in an amount
equal to 1.25 percent (1.25%) of the Company's net income before taxes and
before calculation of all bonuses under the 1998 Incentive Plan for such
fiscal year, and excluding the expenses that the Company records for
accounting purposes as transaction expenses associated with a Significant
Acquisition or a prospective Significant Acquisition in accordance with
Generally Accepted Accounting Principles ("Net Income") in excess of
$1,200,000 and up to $3,200,000, and equal to 1.75 percent (1.75%) of Net
Income in excess of $3,200,000 ("Bonus Calculation"). Any amounts due under
this Section 3.2 shall be payable to the Executive within 90 days of the
end of the applicable fiscal year in a cash lump-sum payment.
Notwithstanding the foregoing, if a Significant Acquisition is completed,
the Bonus Calculation shall be based on the Net Income of only that portion
of the Company's operations that are comparable to the Company's operations
immediately prior to a Significant Acquisition. By way of example, and not
of limitation, the operations of the Company as of the date of this
Agreement are designing, manufacturing (through independent contractors),
importing and wholesaling women's intimate apparel."
3. Section 4.6(d) shall be deleted in its entirety and replaced with the
following:
"(d) Payment Upon Termination by Company Without Cause, by Executive
for "Good Reason" or Following Expiration of Term. In the event that
Executive's employment is terminated pursuant to Section 4.4 or 4.5, or if
the Company does not continue Executive's employment at the end of the Term
and thereafter upon terms substantially similar to the terms of this
Agreement (excluding the option grant referred to in Section 3.3 and
excluding the commitment to offer employment for a specified term), the
Company shall have no further obligations to Executive hereunder except
for: (i) the Base Salary due Executive pursuant to Section 3.1 hereof
through the end of the Term; (ii) any Bonus which would have become payable
under Section 3.2 through the end of the Term; (iii) all earned and
previously approved but unpaid Bonuses; (iv) all valid expense
reimbursements; (v) all accrued but unused vacation pay; (vi) the benefits
set forth in Sections 3.4 and 3.6 through the end of the Term ; (vii) the
sum of $200,000.00, which shall be paid in equal installments in accordance
with the Company's normal payroll procedures, so that the entire amount
shall be received by Executive by March 15th of the calendar year following
the date of termination of employment; and (viii) medical coverage at the
Company's expense for one year commencing on either (a) the last day of the
Term if Executive's employment is terminated during the Term or (b) the
date of termination if Executive's employment is terminated at any time
after the end of the Term; provided, however, that Executive's medical
coverage shall terminate upon the Executive becoming covered under a
similar program by reason of employment elsewhere. The provisions of
Section 4.6(d)(iii), (iv), (v), (vii) and (viii) shall survive termination
of this Agreement, as applicable.
4. Section 6.7 shall be deleted in its entirety and replaced with the
following:
"6.7 Survival. The provisions of this Section 6 shall survive the
termination of this Agreement for any reason, except in the event Executive
is terminated by the Company without "Cause", or if Executive terminates
this Agreement with "Good Reason," in either of which events, Section 6.4
shall be null and void and of no further force or effect.
Please confirm your agreement to the foregoing by countersigning and
returning a copy of this letter.
MOVIE STAR, INC.
By: /s/ Xxxxxx Xxxxxx
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Xxxxxx Xxxxxx
President and Chief Executive
Officer
AGREED:
/s/ Xxxx Xxxxxxxxx
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Xxxx Xxxxxxxxx
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