AMENDED EMPLOYMENT AGREEMENT
AMENDED EMPLOYMENT AGREEMENT, dated as of July 29, 1997, by and
between ▇▇▇▇▇▇ ▇▇▇▇▇▇, LTD., a New York corporation with offices at ▇▇-▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇▇▇ (the "Corporation"), and ▇▇▇▇▇▇
▇▇▇▇▇▇, an individual residing at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
(the "Executive").
WITNESSETH
WHEREAS, Corporation has entered into an employment agreement with
Executive dated as of September 1, 1993 (the "Prior Employment Agreement"),
which Corporation and Executive desire to amend;
WHEREAS, Corporation desires to secure the services of Executive upon
the terms and conditions hereinafter set forth;
WHEREAS, Executive desires to continue to render services to
Corporation upon the terms and conditions hereinafter set forth; and
WHEREAS, in partial consideration of the execution of this Agreement
and the performance by Executive of his duties hereunder, the Corporation has
granted the Executive options to purchase up to 500,000 shares of Common Stock
of the Corporation par value $.000l per share.
NOW, THEREFORE, the parties mutually agree as following:
Section 1. EMPLOYMENT. Corporation hereby employs Executive and
Executive hereby accepts such employment, as an executive of Corporation,
subject to the terms and conditions set forth in this Agreement
Section 2. DUTIES. Executive shall serve as the President, Chief
Executive Officer and Chairman of the Board of Directors of Corporation and
shall properly perform such duties as may be assigned to him from time to time
by the Board of Directors of the Corporation. If requested by Corporation,
Executive shall serve on any committee of Corporation's Board of Directors
without additional compensation. During the term of this Agreement, Executive
shall devote substantially all of his business time to the performance of his
duties hereunder unless otherwise authorized by the Board of Directors.
Section 3. TERM OF EMPLOYMENT.
(a) The term of Executive's employment, unless sooner
terminated as provided herein, shall be for a period of ten (10)
years commencing January 1, 1998 (the "Term").
Section 4. COMPENSATION OF EXECUTIVE.
4.1 SIGNING BONUS; SALARY. Upon execution of this
Agreement, Corporation shall pay to Executive a signing bonus of $200,000.
Corporation shall pay to Executive the following base salary ("Base Salary") for
his services hereunder, less such deductions as shall be required to
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be withheld by applicable law and regulations: Two Hundred Seventy-Five Thousand
($275,000) Dollars for each twelve (12) month period commencing January 1, 1998
and ending December 31, 1999; Three Hundred Thousand ($300,000) Dollars for the
twelve (12) month period commencing January 1, 2000; and, for each 12-month
period thereafter, an amount equal to the Base Salary for the previous 12-month
period plus ten percent (10%) of such Base Salary.
4.2 TIME OF PAYMENT. All salaries payable to Employee shall
be paid at such regular weekly, biweekly or semi-monthly time or times as the
Corporation makes payment of its regular payroll in the regular course of
business.
4.3 DISCRETIONARY BONUS. Executive shall be entitled to such
Bonus[es](in cash, capital stock or other property) (the "Discretionary Bonus")
as the Board of Directors of the Corporation may determine from time to time in
its sole discretion.
4.4 EXPENSES. In addition to those expenses expressly set
forth herein, Corporation shall provide to Executive a Fifty Thousand Dollar
($50,000) annual non-accountable expense allowance. Additionally, Corporation
shall, at the direction of Executive, either reimburse Executive for, or
directly pay the costs of, membership dues for any professional organizations
that Executive chooses to join.
4.5 AUTOMOBILE ALLOWANCE. With respect to Executive's use of
an automobile in connection with the performance of his duties hereunder,
Corporation shall, at the direction of Executive, either reimburse Executive
for, or directly pay the costs of, the use of an automobile during the Term of
this Agreement and all usual expenditures in connection therewith; i.e., fuel,
insurance, parking, customary maintenance and repairs, etc. The type of
automobile, which may be changed during the Term and shall not have a suggested
retail selling price in excess of Fifty Thousand Dollars ($50,000), shall be
selected by Executive.
4.6 BENEFITS. Executive shall be entitled to participate in
such pension, profit sharing, group insurance, option plans, hospitalization,
and group health and benefit plans and all other benefits and plans as
Corporation provides to its senior executives.
Section 5. TERMINATION.
5.1 DEATH. This Agreement shall terminate upon the death of
Executive; PROVIDED, HOWEVER, that Corporation shall continue to pay to the
estate of Executive the appropriate salary as set forth in Section 4.1 hereof
for the twelve (12) month period immediately subsequent to the date of
Executive's death.
5.2 TERMINATION FOR CAUSE OR TOTAL DISABILITY; RESIGNATION.
In the event Executive is discharged "For Cause" or due to his "Total
Disability" (as those terms are defined below) or in the event Executive resigns
(other than pursuant to Section 5.5 hereof), then upon such occurrence, this
Agreement shall be deemed terminated and Corporation shall be released from all
obligations to Executive with respect to this Agreement, except obligations
accrued prior to such termination date and as provided in Section 6.2 hereof.
5.3 TERMINATION OTHER THAN FOR CAUSE OR TOTAL DISABILITY. In
the event Executive
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is discharged other than "For Cause" or due to his "Total Disability," then such
termination shall only be effective if prior to the date hereof, the Corporation
shall have delivered to Executive the balance of his salary that would have been
paid by the Corporation pursuant to Section 4.1 hereof over the full Term of the
Agreement if the Corporation had not terminated this Agreement. Such amount
shall be payable in two (2) installments as follows: (i) fifty (50%) percent of
the amount due pursuant to the terms of this Section 5.3 upon termination of the
Agreement and (ii) fifty (50%) percent in equal annual installments beginning on
the January 1 immediately following such termination and each January 1 thereof
until January 1, 2008.
5.4 "FOR CAUSE". As used herein, the term "For Cause" shall
mean:
(a) a deliberate and material breach by Executive of his
duties and responsibilities under this Agreement that results in
material harm to Corporation which breach is committed without
reasonable belief that such breach is in, or not contrary to, the
best interests of Corporation, and is not remedied within thirty (30)
days after receipt of written notice from Corporation specifying such
breach; or
(b) Executive's plea of guilty or nolo contendere to, or
non-appealable conviction of, a felony, which conviction or plea
causes material damage to the reputation or financial position of
Corporation.
5.5 TERMINATION UPON CHANGE OF CONTROL.
(a) If a Change of Control (as defined below) occurs
without Executive's prior written consent, Executive shall have the
right to terminate this Agreement. At least ten (10) days prior to
any such proposed Change of Control, Corporation shall notify
Executive of its intention to effect such Change of Control, and
Executive shall thereupon have five (5) days from the actual receipt
of such notice to give notice of his intention to terminate this
Agreement in the event of the Change of Control. If, notwithstanding
such notice by Executive, Corporation proceeds with such Change of
Control, this Agreement shall be deemed terminated as of the
effective date of the event constituting the Change of Control and
Executive shall receive in cash, within ten (10) days of termination,
(i) any compensation accrued and unpaid pursuant to Section 4 of this
Agreement, (ii) an amount equal to the balance of Executive's salary
that would have been paid by Corporation pursuant to Section 4.1
hereof over the full Term of this Agreement if the Agreement had not
been terminated, and (iii) an amount equal to Executive's bonus, if
any, for the preceding 12-month period ended December 31, multiplied
by the remaining years (including any fractional years) left under
this Agreement since the date such bonus was determined by the Board
of Directors. In the event that any payment (or portion thereof) to
Executive under this Section 5.5 is determined to constitute an
"excess parachute payment," under Sections 280G and 4999 of the
Internal Revenue Code of 1986, as amended, the following calculations
shall be made:
(i) The after-tax value to Executive of the payments
under this Section 5.5 without any reduction; and
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(ii) the after-tax value to Executive of the
payments under this Section 5.5 as reduced to the maximum amount (the "Maximum
Amount") which may be paid to Executive without any portion of the payments
constituting an "excess parachute payment".
If after applying the agreed upon calculations set forth above, it is determined
that the after-tax value determined under clause (ii) above is greater than the
after-tax value determined under clause (i) above, the payments to Executive
under this Section 5.5 shall be reduced to the Maximum Amount.
(b) If a Change of Control occurs, regardless of whether
Executive has consented to such Change of Control, Executive shall
have the right to resign for Good Reason (as defined below).
5.6 "CHANGE OF CONTROL". As used herein, the term "Change of
Control" shall mean:
(a) 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
Corporation or any subsidiary or any affiliate of Corporation or any
employee benefit plan sponsored or maintained by Corporation or any
subsidiary of Corporation (including any trustee of such plan acting
as trustee), becomes the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act) of securities of Corporation representing 20%
or more of the combined voting power of Corporation's then
outstanding securities; or
(b) 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 24-month period shall be deemed to
have satisfied such 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 of the directors who
then qualified as Incumbent Directors either actually (because they
were directors at the beginning of such 24-month period) or through
the operation of this proviso; or
(c) The occurrence of a transaction requiring stockholder
approval for the acquisition of Corporation by an entity other than
Corporation or a subsidiary or an affiliated company of Corporation
through purchase of assets, or by merger, or otherwise.
5.7 "GOOD REASON" As used herein, the term "Good Reason" shall
mean the occurrence of any of the following:
(a) the assignment to Executive of any duties
inconsistent with his positions, duties,
responsibilities and status with
Corporation as contemplated hereunder, or
any removal of Executive from any positions
or offices Executive held as contemplated
hereunder, except in connection with the
termination of Executive's employment by
Corporation For Cause or on account of
Total Disability pursuant to
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the requirements of this Agreement;
(b) a reduction by Corporation of Executive's
Base Salary as in effect as contemplated
hereunder, except in connection with the
termination of the Executive's employment
by Corporation For Cause or due to Total
Disability pursuant to the requirements of
this Agreement;
(c) any termination of Executive's employment
by Corporation during the Term that is not
effected pursuant to the requirements of
this Agreement;
(d) any material breach by Corporation of the
terms of this Agreement;
(e) the relocation of Executive's work location
from the location set forth herein; or
(f) failure by any successor to Corporation
expressly to assume all obligations of
Corporation under this Agreement.
Section 6. DISABILITY.
6.1 TOTAL DISABILITY. In the event that after Executive has failed to
have performed his regular and customary duties for a period of one hundred and
eighty (180) consecutive days or for any two hundred and seventy (270) days out
of any three hundred and sixty (360) day period, and before Executive has become
"Rehabilitated" (as hereinbelow defined) a majority of the members of the Board
of Directors of the Corporation, exclusive of Executive, may vote to determine
that Executive is mentally or physically incapable or unable to continue to
perform such regular and customary duties of employment and upon the date of
such majority vote, Executive shall be deemed to be suffering from a "Total
Disability." As used herein, the term "Rehabilitated" shall mean such time as
Executive is willing, able and commences to devote his time and energies to the
affairs of Corporation to the extent and in the manner that he did so prior to
his disability.
6.2 PAYMENT DURING DISABILITY. In the event Executive is unable to
perform his duties hereunder by reason of a disability, prior to the time such
disability is deemed a Total Disability in accordance with the provisions of
Section 6.1 above, Corporation shall continue to pay Executive his appropriate
Base Salary pursuant to Section 4.1 during the continuance of any such
disability. Upon a determination of any Total Disability pursuant to the
provisions of Section 6.1 above, Corporation shall pay to Executive his
appropriate Base Salary pursuant to Section 4.1 for the twelve (12) month period
immediately subsequent to the date of determination of Total Disability.
Section 7. VACATIONS. Executive shall be entitled to a vacation of four (4)
weeks per year, during which period his Base Salary shall be paid in full.
Executive shall take his vacation at such time or times as Executive and
Corporation shall determine is mutually convenient.
Section 8. DISCLOSURE OF CONFIDENTIAL INFORMATION. Executive recognizes that
he has had and will continue to have access to secret and confidential
information regarding Corporation,
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including but not limited to its customer list, products, know-how, and business
plans. Executive acknowledges that such information is of great value to
Corporation, is the sole property of Corporation, and has been and will be
acquired by him in confidence. In consideration of the obligations undertaken by
Corporation herein, Executive will not, at any time, during or after his
employment hereunder, reveal, divulge or make known to any person, any
information acquired by Executive during the course of his employment, which is
treated as confidential by Corporation, including but not limited to its
customer list, and not otherwise in the public domain. The provisions of this
Section 8 shall survive Executive's employment hereunder.
Section 9. COVENANT NOT TO COMPETE.
(a) Executive recognizes that the services to be performed
by him hereunder are special, unique and extraordinary. The parties
confirm that it is reasonably necessary for the protection of
Corporation that Executive agree, and accordingly, Executive does
hereby agree, that he shall not, directly or indirectly, at any time
during the "Restricted Period" within the "Restricted Area" (as those
terms are defined in Section 9(e) below):
(i) except as provided in Subsection (c) below,
engage in the business of manufacturing,
designing or marketing shoes either on his
own behalf or as an officer, director,
stockholder, partner, consultant,
associate, employee, owner, agent,
creditor, independent contractor, or
co-venturer of any third party; or
(ii) employ or engage, or cause or authorize,
directly or indirectly, to be employed or
engaged, for or on behalf of himself or any
third party, any non-secretarial employee
or agent of Corporation.
(b) Executive hereby agrees that he will not, directly or
indirectly, for or on behalf of himself or any third party, at any
time during the Term and during the Restricted Period solicit any
customers of Corporation.
(c) If any of the restrictions contained in this Section 9
shall be deemed to be unenforceable by reason of the extent, duration
or geographical scope thereof, or otherwise, then the court making
such determination shall have the right to reduce such extent,
duration, geographical scope, or other provisions hereof and in its
reduced form this Section shall then be enforceable in the manner
contemplated hereby.
(d) This Section 9 shall not be construed to prevent
Executive from owning, directly and indirectly, in the aggregate, an
amount not exceeding five percent (5%) of the issued and outstanding
voting securities of any class of any corporation whose voting
capital stock is traded on a national securities exchange or in the
over-the-counter market.
(e) The term "Restricted Period," as used in this Section 9,
shall mean the period of Executive's actual employment hereunder
plus: (i) twelve (12) months after the date Executive is actually no
longer employed by Corporation in the event this Agreement expires or
Executive's termination For Cause; and, (ii) twenty-four (24) months
after the date Executive is actually no longer employed by
Corporation in the event that Executive resigns,
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except if Executive resigns pursuant to Section 5.5 hereof. The term
"Restricted Area" as used in this Section 9 shall mean the seventy-five
(75) mile radius from Corporation's principal executive offices.
(f) The provisions of this Section 9 shall survive the
termination of Executive's employment hereunder and until the end of
the Restricted Period as provided in Section 9(e) hereof.
Section 10. MISCELLANEOUS.
10.1 INJUNCTIVE RELIEF. Executive acknowledges that the
services to be rendered under the provisions of this Agreement are of a special,
unique and extraordinary character and that it would be difficult or impossible
to replace such services. Accordingly, Executive agrees that any breach or
threatened breach by him of Sections 8 or 9 of this Agreement shall entitle
Corporation, in addition to all other legal remedies available to it, to apply
to any court of competent jurisdiction to seek to enjoin such breach or
threatened breach. The parties understand and intend that each restriction
agreed to by Executive hereinabove shall be construed as separable and divisible
from every other restriction, that the unenforceability of any restriction shall
not limit the enforceability, in whole or in part, of any other restriction, and
that one or more or all of such restrictions may be enforced in whole or in part
as the circumstances warrant. In the event that any restriction in this
Agreement is more restrictive than permitted by law in the jurisdiction in which
Corporation seeks enforcement thereof such restriction shall be limited to the
extent permitted by law.
10.2 ASSIGNMENTS. Neither Executive nor Corporation may assign
or delegate any of their rights or duties under this Agreement without the
express written consent of the other.
10.3 ENTIRE AGREEMENT. This Agreement constitutes and embodies
the full and complete understanding and agreement of the parties with respect to
Executive's employment by Corporation, supersedes all prior understandings and
agreements, whether oral or written, between Executive and Corporation,
including but not limited to the Prior Employment Agreement, and shall not be
amended, modified or changed except by an instrument in writing executed by the
party to be charged. The invalidity or partial invalidity of one or more
provisions of this Agreement shall not invalidate any other provision of this
Agreement. No waiver by either party of any provision or condition to be
performed shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same time or any prior or subsequent time.
10.4 BINDING EFFECT. This Agreement shall inure to the benefit
of, be binding upon and enforceable against, the parties hereto and their
respective successors, heirs, beneficiaries and permitted assigns.
10.5 HEADING. The headings contained in this Agreement are for
convenience of reference only and shall not affect in any way the meaning or
interpretation of this Agreement.
10.6 NOTICES. All notices, requests, demands and other
communications required or permitted to be given hereunder shall be in writing
and shall be deemed to have been duly given when personally delivered, sent by
registered or certified mail, return receipt requested, postage prepaid, or by
private overnight mail service (e.g. Federal Express) to the party at the
address set
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forth above or to such other address as either party may hereafter give notice
of in accordance with the provisions hereof. Notices shall be deemed given on
the sooner of the date actually received or the third business day after
sending.
10.7 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without giving
effect to such State's conflicts of 1aws provisions and each of the parties
hereto irrevocably consents to the jurisdiction and venue of the federal and
state courts located in the State of New York, County of New York.
10.8 COUNTERPARTS. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
10.9 TERMINATION OF CONSULTING AGREEMENT PROVISION. Reference
is made to the Consulting Agreement (the "Consulting Agreement"), dated as of
March 23, 1995, between BOCAP Corp., a Florida corporation ("BOCAP"), and
Corporation, and the Assignment and Assumption Agreement, dated as of May 26,
1995, among BOCAP, Executive and Corporation, pursuant to which Executive
assumed the rights and duties of BOCAP under the Consulting Agreement. The
second paragraph of Section 3 of the Consulting Agreement is hereby terminated
and shall be of no further force and effect as of the date hereof.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date set forth above.
▇▇▇▇▇ ▇▇▇▇▇▇ LTD.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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