Exhibit 10.29
[Letterhead of Xxxxxxxx Corporation]
December 18, 2001
Xxxxxxx X. Xxxxxx, Xx.
000 Xxxxxxx Xxxxxxx Xxxx
Xxxxxxxxxx Xxxx, Xxxxxxxx 00000
Dear Xxxxxxx:
As you were previously notified, Xxxxxxxx chose not to allow the
Term of your Employment Agreement to renew. Accordingly, your Employment
Agreement expired as of September 30, 2001. To whatever extent your
employment may continue beyond that date, it will do so on an at-will basis
and, as such, will be subject to termination, at any time, with or without
cause.
The purpose of this letter is to set forth the terms of your
continued employment by Xxxxxxxx following the expiration of your Employment
Agreement on September 30, 2001. These terms of employment will remain in
effect for the period beginning October 1, 2001 and ending March 31, 2002,
or until any earlier termination of your employment. If your employment
continues with Xxxxxxxx beyond March 31, 2002, it will do so on an at-will
basis and upon such terms and conditions as may be mutually agreed to in
writing at that time.
1. EMPLOYMENT AT WILL - Again, to whatever extent your
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employment by Xxxxxxxx may continue after September 30,
2001, it will do so on an at-will basis. Your employment
may be terminated immediately at any time by Xxxxxxxx,
with or without cause.
2. COMPENSATION - Your base salary will be $16,666.66 per
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month ($200,000.00 annualized), payable in accordance with
Xxxxxxxx's current payroll practices. Except as otherwise
provided in this letter, you will continue to be eligible
to participate in such other compensation and benefit
plans and programs generally available to other similarly
situated executives of Xxxxxxxx, including participation
in Angelica's: Short Term Incentive Compensation Plan;
Performance Plan; Stock Bonus and Incentive Plan;
Retirement Savings Plan (401k); Pension Plan; and
Supplemental Plan. It is understood that Xxxxxxxx may, at
any time and in its sole discretion, eliminate, amend,
modify or replace any such plan(s).
3. DUTIES - You will continue to serve as Vice President of
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Xxxxxxxx Corporation and as President of Xxxxxxxx's
Manufacturing and Marketing Business Segment (i.e.
Xxxxxxxx Image Apparel and the Canadian operations).
However, your duties, authority, title and
responsibilities (including, but not limited to, your
status, offices and reporting requirements), may be
changed and/or diminished by Xxxxxxxx, in its sole
discretion, at any time and from time to time, with or
without cause.
4. TRIGGERING TRANSACTION - It is understood that Xxxxxxxx
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has undertaken efforts to sell the assets of its
Manufacturing and Marketing Business Segment. Further, it
is understood and agreed that your support, cooperation
and
Xxxxxxx X. Xxxxxx, Xx.
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December 18, 2001
assistance is important to the success of those efforts.
Accordingly, the duties and responsibilities of your
employment will include your full support of, as well as
your cooperation and assistance with, Xxxxxxxx's efforts
to complete such transaction.
4.1 For purposes of this letter, a "Triggering
Transaction" will mean any such transaction pursuant to
which 50% or more of the assets of Xxxxxxxx's
Manufacturing and Marketing Business Segment are sold to a
third party.
5. SEPARATION PAYMENTS -- If on or prior to March 31, 2002,
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your employment is terminated by Xxxxxxxx without good
cause, then, subject to the provisions of paragraph 7
below, Xxxxxxxx will pay you an amount equal to six (6)
months base salary (or such greater amount as Xxxxxxxx, in
its sole discretion, deems appropriate). Said amounts will
be paid in equal, semi-monthly payments, less applicable
taxes, withholdings and standard deductions. To the extent
that the obligation to pay said amounts arises hereunder,
such obligation will survive the termination of your
employment until such time as said amounts have been paid.
5.1 For purposes of this letter, "good cause" means:
(i) your continued failure to substantially perform your
duties with Xxxxxxxx, including those identified in
paragraph 3 above, (other than as a result of incapacity
due to physical or mental condition); (ii) your commission
of an act constituting a criminal offense involving moral
turpitude, dishonesty or breach of trust; or (iii) your
failure to fulfill or comply with any material term of
your employment. You will not be entitled to any
separation payments if your employment is terminated by
you or by Xxxxxxxx with good cause.
6. INCENTIVE FEE - If, during your employment or, in the case
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your employment is terminated by Xxxxxxxx without good
cause then during the six (6) month period thereafter, a
Triggering Transaction is consummated, Xxxxxxxx will pay
you, in addition to any separation payments provided for
in paragraph 5 above, an incentive payment as follows:
(a) In the event of a Triggering Transaction
for the sale of 90% or more of the
assets of the Manufacturing and
Marketing Business Segment, Xxxxxxxx
will pay you an incentive fee payment of
$100,000;
(b) In the event of a Triggering Transaction
for the sale of 50% or more, but less
than 100%, of the assets of the
Manufacturing and Marketing business
Segment, Xxxxxxxx will pay you an
incentive fee payment of $50,000;
(c) In that the sale of less than 50% of the
assets of the Manufacturing and
Marketing Business Segment is not a
Triggering Transaction, Xxxxxxxx will
not be obligated to pay you any
incentive fee payment in the event of
such a transaction.
Xxxxxxx X. Xxxxxx, Xx.
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December 18, 2001
To the extent that the obligation to pay any such
incentive fee may not arise hereunder until after the
termination of your employment, such obligation will
survive such termination until such obligation has been
determined and, if earned, has been paid.
Notwithstanding anything to the contrary, it is understood
that if your employment is terminated by you, or by
Xxxxxxxx for good cause, prior to the consummation of a
Triggering Transaction, Xxxxxxxx will have no obligation
to pay any such incentive fee.
7. SETTLEMENT AGREEMENT AND RELEASE - Any and all payments to
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be made to you pursuant to paragraph 5 or 6, shall be
expressly conditioned upon the negotiation and execution
of a mutually acceptable settlement agreement and release
by you and Xxxxxxxx. Such settlement agreement and release
shall include, but not be limited to: a release by you of
all claims against Xxxxxxxx; your covenant not to compete
with Xxxxxxxx for a period to be determined and agreed to
in such agreement; your continuing agreement not to
disclose confidential information of Xxxxxxxx; your
agreement not to solicit Xxxxxxxx's employees for
employment by you or by others for a period of not less
than one year; your agreement not to disparage Xxxxxxxx;
and such other terms and conditions as are customarily
included in such agreements to which Xxxxxxxx is a party.
8. MISCELLANEOUS - The above sets forth the terms of your
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employment and supersedes any prior written or oral
agreements, understandings, discussions or negotiations
with respect thereto.
Please acknowledge your receipt and acceptance of these terms by
signing and returning to me the enclosed copy of this letter.
Very truly yours,
/s/ Xxx X. Xxxxxx
Xxx X. Xxxxxx
RECEIPT AND ACCEPTANCE
ACKNOWLEDGED
/s/ Xxxxxxx X. Xxxxxx, Xx.
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Xxxxxxx X. Xxxxxx, Xx.
