AMENDMENT TO EMPLOYMENT AGREEMENT
EXHIBIT
10.1
AMENDMENT
TO
THIS
AMENDMENT TO EMPLOYMENT AGREEMENT (this “Amendment”),
dated
as of March 3, 2006 is entered into by and between Merisel, Inc,. a Delaware
corporation (the “Company”)
and
Xxxxxx X. Xxxx (the “Executive”).
BACKGROUND
The
Company and the Executive entered into that certain employment agreement dated
as of November 22, 2004 (the “Employment
Agreement”).
The
parties to the Employment Agreement now desire to amend the Employment
Agreement, as permitted in Section 17 of the Employment Agreement, as set forth
in this Amendment. Capitalized terms used but not defined in this Amendment
have
the meaning given such terms in the Employment Agreement.
NOW,
THEREFORE, in consideration of the covenants and agreements set forth herein,
the parties hereto agree as follows:
1. The
first
sentence of Section 1(a) is amended to read in its entirety as follows:
The
Executive shall serve as Chairman, President and Chief Executive Officer of
the
Company.
2. The
first
sentence of Section 1(c) is amended as follows:
The
first
sentence shall read: “The Executive’s principal place of employment shall be at
the Company’s current location, 000 X. 00xx
Xxxxxx,
Xxx Xxxx, Xxx Xxxx, 00000 (the “Current Location”).
The
second sentence of Section 1(c) is deleted in its entirety.
3. A
new
sentence is added to Section 2 to read as follows:
“The
period from the Effective Date until November 22, 2007 is hereinafter referred
to as the “Initial Term.”
4. The
first
sentence of Section 3(a) is amended in its entirety to read as follows:
“The
Company shall pay to the Executive an annual salary (the “Base Salary”) at the
rate of $400,000 per year.”
5. The
last
sentence of Section 3(b) is deleted in its entirety.
6. A
new
last sentence is added to Section 3(c) to read as follows:
“Any
Annual Bonus shall be paid in the calendar year following the year in which
such
Annual Bonus is earned upon receipt of Audit Committee approval of financial
statements for the prior year.”
7. The
second to the last sentence of the first paragraph of Section 4(b) is amended
in
its entirety and a new sentence shall be added immediately after such sentence,
to read as follows:
“All
unvested Effective Date Stock Options shall immediately terminate, and all
unvested Restricted Stock shall be immediately forfeited. All vested Effective
Date Stock Options and vested Restricted Stock shall be immediately forfeited
only if termination for Cause occurs prior to the end of the Initial Term.
8. A
new
proviso shall be added to the third sentence of Section 4(c) to read as
follows:
“;
provided further that a pro rata portion (determined based on a fraction, the
numerator of which is the number of days from the most recent anniversary of
the
Effective Date to the date of such termination and the denominator of which
is
365 days) of (x) the unvested Effective Date Stock Options in each Option
Tranche and (y) the shares of Effective Date Restricted Stock that were
scheduled to have vested on the anniversary of the Effective Date next following
the date of termination shall become immediately vested.
9. Section
4(e)(ii) is amended in its entirety to read as follows:
“(ii) a
lump
sum payment equal to his Base Salary for a period commencing on the date of
termination and ending on the twenty-four month anniversary of the date of
termination.”
10. Section
4(f)(ii) is amended in its entirety to read as follows:
“(ii) a
lump
sum payment equal to his Base Salary for a period commencing on the date of
termination and ending on the twenty-four month anniversary of the date of
termination.”
11. A
new
Section 4(h) shall be added to the Agreement as follows:
“Notwithstanding
any contrary provision of Section 4, in the event Executive is due any payment
in respect of bonus payments, such payments shall be made in a lump sum payment.
Subject to Section 24, all payments shall be made within 30 days after the
date
of termination of employment.
12. A
new
Section 23 shall be added as follows:
“Section
23. Indemnification.
The
Company shall indemnify the Executive in accordance with the provisions of
a
separate indemnity agreement entered into between the Company and the
Executive.”
13. A
new
Section 24 shall be added as follows:
“Section
24. Compliance
With Section 409A; Deferral of Certain Payments.
Notwithstanding anything herein to the contrary, this Agreement shall at all
times be operated in accordance with the requirements of Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”). In particular, and
without limiting the generality of the foregoing:
(a) If
any
action taken hereunder in connection with any stock right, including the
vesting, extension or renewal of the stock right, would result in the stock
right becoming subject to the provisions of Section 409A of the Code, such
action shall not be taken or shall be taken only to the extent that it will
not
result in the stock right becoming subject to Section 409A; and
(b) If
the
Executive, at the time of his “separation from service” from the Company, is a
“specified employee,” then to the extent any payment under this Agreement upon
the Executive’s termination of employment is subject to Section 409A of the
Code, no such payment shall be made for six (6) months following the Executive’s
“separation from service.” The terms “separation from service” and “specified
employee” shall have the meanings set forth under Section 409A of the Code and
the regulations and rulings issued thereunder.”
14. Except
as
affected by this Amendment, the Agreement is unchanged and continues in full
force and effect. All references to the Agreement shall refer to the Agreement
as amended by this Amendment. This Amendment shall be binding upon and inure
to
the benefit of each of the undersigned and their respective successors and
permitted assigns.
15. This
Amendment may be executed in one or more counterparts, each of which shall
be
deemed an original but all of which together will constitute one and the same
instrument. Delivery of an executed counterpart of a signature page to this
Amendment by facsimile shall be as effective as delivery of a manually executed
counterpart of this Amendment.
16. This
Amendment shall be governed by and construed in accordance with the domestic
laws of the State of Delaware (without giving effect to any choice or conflict
of law provision).
IN
WITNESS WHEREOF, the Company has caused this Amendment to be signed pursuant
to
the authority of its Board, and the Executive has executed this Amendment,
as of
the day and year first written above.
| MERISEL, INC. | ||
| |
|
|
| By: | /s/ Xxxxxxx Xxxxxxxxxx | |
|
Xxxxxxx Xxxxxxxxxx |
||
| Title: Chief Financial Officer | ||
| EXECUTIVE | ||
| |
|
|
| By: | /s/ Xxxxxx X. Xxxx | |
|
Xxxxxx X. Xxxx |
||
