EXHIBIT 10.42
CONFIDENTIAL GENERAL RELEASE AND SEPARATION AGREEMENT
THIS CONFIDENTIAL GENERAL RELEASE AND SEPARATION AGREEMENT (hereinafter
"Agreement") is made and entered into this 2nd day of March, 2004 by and between
CDRJ Investments (Lux) SA, a Luxembourg company, CDRJ North Atlantic (Lux)
S.ar.l., a Luxembourg societe a responsabilite limitee, Jafra Worldwide Holdings
(Lux) S.ar.l., a Luxembourg societe a responsabilite limitee, and Jafra
Cosmetics International, Inc., a Delaware corporation (the "Employer")(such
entities, together with any successors thereto, collectively, the "Company"),
and Xxxxx Xxxxx Guirao ("Executive", and together with the Company, hereinafter
the "Parties").
-W-I-T-N-E-S-S-E-T-H-
WHEREAS, CDRJ Investments (Lux) SA, the Employer and the Executive have
previously entered into an Employment Agreement, (the "Employment Agreement")
dated as of June 1, 1998, pursuant to which the Employer employed Executive as
President; Global Operations;
WHEREAS, in connection with a restructuring of CDRJ Investments (Lux) SA
and its subsidiaries, Jafra Worldwide Holdings (Lux) S.ar.l. assumed all of the
obligations of CDRJ Investments (Lux) SA under the Employment Agreement;
WHEREAS, the Employer has determined it is in the best interests of the
Company to terminate the Executive's employment "Without Cause" (as defined in
the Employment Agreement), effective as of March 6, 2004 (the "Termination
Date").
IN CONSIDERATION THEREOF, the Company desires to settle, conclude and
obtain the final release of all possible matters and claims which Executive has
now or may have in the future, whether known or unknown against the Company,
each of their respective direct or indirect subsidiaries, and each of their
affiliates.
NOW THEREFORE, in consideration of the termination benefits provided for
in Section 7 of the Employment Agreement and the other payments and benefits
provided for herein which the parties acknowledge and agree are as set forth on
Annex A attached hereto (collectively, the "Termination Benefits"), the premises
and promises herein contained, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, IT IS AGREED AS
FOLLOWS:
1. Effective as of the Termination Date, the Executive's employment
with, and as an officer of, the Company and each of its subsidiaries and
affiliates is terminated in all respects.
2. As consideration for entering into this Agreement and subject to the
Executive's compliance with the terms of this Agreement, his Employment
Agreement and any other Agreement with the Company or any of its affiliates by
which he is or may be bound (including, but not limited to at all times
hereafter, Section 8 ("Unauthorized Disclosure"), Section 9 ("Non-Competition"),
Section 10 ("Non-Solicitation of Employees"), Section 11 ("Non-Solicitation of
Customers"), Section 12 ("Return of Documents") and Section 13 ("Injunctive
Relief") of the
Employment Agreement, the Company shall provide to the Executive the Termination
Benefits set forth on Annex A hereto (in accordance with the terms and
conditions of the Employment Agreement where applicable). Notwithstanding the
foregoing, the Company shall not be required to provide the Termination Benefits
if the Executive revokes this Agreement in accordance with paragraph 7 hereof.
For the avoidance of doubt, in the event of the death of the Executive during
the two year period commencing on the Termination Date (the "Severance Period"),
the Company shall continue to provide the Termination Benefits set forth on
Annex A hereto to the Executive's estate, beneficiaries or legal representative
as if the Executive had survived for the entire Severance Period.
3. IN RETURN FOR THE RECEIPT OF SUCH TERMINATION BENEFITS, EXECUTIVE ON
HIS OWN BEHALF AND ON BEHALF OF EACH OF HIS AGENTS, REPRESENTATIVES, ASSIGNS,
HEIRS, EXECUTORS AND ADMINISTRATORS, DOES HEREBY FULLY AND GENERALLY RELEASE,
SETTLE, CANCEL, DISCHARGE AND ACKNOWLEDGE TO BE FULLY SATISFIED, AND COVENANT
NOT TO XXX ANY RELEASEE (AS DEFINED BELOW) IN RESPECT OF, ANY AND ALL CLAIMS,
CONTRACTUAL OR OTHERWISE, DEMANDS, COSTS, RIGHTS, CAUSES OF ACTION, CHARGES,
COMPLAINTS, LOSSES, DAMAGES AND ALL LIABILITY OF WHATEVER KIND AND NATURE,
WHETHER KNOWN OR UNKNOWN, WHICH HE MAY HAVE AT THE TIME OF SIGNING THIS
AGREEMENT, OR HAD AT ANY TIME PRIOR THERETO, AGAINST ANY OF THE COMPANY, ANY
SUBSIDIARY OR AFFILIATE OF THE COMPANY, ANY SUCCESSOR OR ASSIGN OF ANY SUCH
ENTITY OR ANY OF THEIR RESPECTIVE EMPLOYEES, DIRECTORS, OFFICERS, AGENTS OR
OTHER REPRESENTATIVES (COLLECTIVELY, THE "RELEASEES") WHICH MAY IN ANY WAY BE
CONNECTED WITH OR RELATED TO EXECUTIVE'S EMPLOYMENT WITH THE COMPANY OR THE
SEVERING OR PERMANENT DISCONTINUANCE OF THAT EMPLOYMENT (COLLECTIVELY, THE
"CLAIMS"), OTHER THAN THE EXCLUDED CLAIMS (AS DEFINED BELOW). THIS RELEASE
SPECIFICALLY INCLUDES CLAIMS IN RESPECT OF ALL PERSONAL INJURIES AND
CONSEQUENCES THEREOF, INCLUDING DEATH AND PAIN AND SUFFERING, AND ANY INJURIES
WHICH MAY NOW EXIST BUT WHICH, AT THIS TIME, ARE UNKNOWN, UNKNOWABLE, OR
UNANTICIPATED, OR WHICH MAY OR MAY NOT DEVELOP FURTHER AT SOME TIME IN THE
FUTURE, AND ALL POTENTIAL CLAIMS CONCERNING ANY UNFORESEEABLE OR UNANTICIPATED
FURTHER DEVELOPMENT OR CONSEQUENCES OF KNOWN INJURIES, OTHER THAN THE EXCLUDED
CLAIMS.
WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, IT IS EXPRESSLY AGREED
AND UNDERSTOOD THAT THIS RELEASE INCLUDES, BUT IS NOT LIMITED TO, ANY CLAIM
BEFORE ANY COURT, GOVERNMENT AGENCY OR IN ANY OTHER FORUM, INCLUDING BUT NOT
LIMITED TO, CLAIMS UNDER TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AS AMENDED,
42 U.S.C. SECTION 621 ET SEQ. (AGE DISCRIMINATION), THE NATIONAL LABOR RELATIONS
ACT, AS AMENDED, 29 U.S.C., SECTION 141 ET SEQ. (UNION AND COLLECTIVE ACTIVITY),
THE EQUAL PAY ACT OF 1963, 29 U.S.C. SECTION 201 ET SEQ. (EQUAL PAY), THE
AMERICANS WITH DISABILITIES ACT, 42 U.S.C. SECTION 12101 (DISABILITY
DISCRIMINATION), THE REHABILITATION ACT OF 1973, 29 U.S.C. SECTION 701
(DISABILITY DISCRIMINATION), THE CIVIL RIGHTS ACTS OF 1866 AND 1871, AS AMENDED,
29 U.S.C. SECTION 1981 ET SEQ. (CIVIL RIGHTS), THE CONSOLIDATED OMNIBUS BUDGET
RECONCILIATION ACT OF 1985, AS AMENDED, (COBRA-GROUP HEALTH INSURANCE), THE
EMPLOYEE RETIREMENT AND INCOME SECURITY ACT, AS AMENDED, 29 U.S.C. SECTION 1001
ET SEQ. (EMPLOYEE BENEFITS), THE FAIR LABOR STANDARDS ACT, AS AMENDED, 29 U.S.C.
SECTION 201 ET SEQ. (MINIMUM WAGE, OVERTIME PAY AND WORKING HOURS), THE FAMILY
MEDICAL LEAVE ACT OF 1993, AS AMENDED, 42 U.S.C. SECTION 2601 ET SEQ. (LEAVES OF
ABSENCE), ACTION FOR RACE, COLOR, RELIGION, AGE, SEX, NATIONAL ORIGIN AND
HANDICAP DISCRIMINATION OR FOR WORK-RELATED INJURIES OR PAYMENT OF WAGES ARISING
UNDER STATE LAW, FOR WRONGFUL DISCHARGE BASED UPON AN IMPLIED CONTRACT OR PUBLIC
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POLICY, AND ANY OTHER FEDERAL, STATE OR LOCAL STATUTE, PUBLIC POLICY, ORDER,
REGULATION, TORT OR CONTRACT CLAIM, IN EACH CASE, OTHER THAN THE EXCLUDED
CLAIMS.
FOR PURPOSES OF THIS AGREEMENT, THE TERM "EXCLUDED CLAIMS" MEANS CLAIMS
BROUGHT UNDER OR TO ENFORCE THE TERMS OF THIS AGREEMENT. FOR THE AVOIDANCE OF
DOUBT, THIS AGREEMENT IS NOT INTENDED TO GOVERN MATTERS RELATING TO SHARES OR
STOCK OPTIONS OF THE COMPANY OR ANY OF ITS AFFILIATES PURCHASED BY OR GRANTED TO
THE EXECUTIVE, WHICH SHALL BE GOVERNED BY THE TERMS OF THE PLANS AND/OR
AGREEMENTS UNDER WHICH SUCH SHARES OR STOCK OPTIONS WERE PURCHASED OR GRANTED.
4. Executive understands, agrees and acknowledges that this Agreement is
intended to include in its effect, without limitation, claims and causes of
action which he does not know of or suspect to exist in his favor at the time of
executing this Agreement, and that this Agreement contemplates extinguishment of
all such claims and causes of action.
5. For the avoidance of doubt, the Parties agree that Section 16 of the
Employment Agreement ("Indemnification"), pursuant to which the Employer has
agreed to provide certain indemnification benefits to the Executive in
accordance with the terms and conditions set forth therein, shall remain in full
force and effect for the Severance Period and shall be incorporated by reference
herein and made a part hereof.
6. Executive understands, agrees and acknowledges that by signing this
Agreement he is not relying on any representation, promise or statement, either
oral or written, not contained in this Agreement.
7. Executive understands, agrees and acknowledges that:
(a) he has been encouraged by representatives of the Company to
have this Agreement reviewed by legal counsel of his own choosing and
that he has been given ample time to do so prior to signing it;
(b) he has had the opportunity to negotiate concerning the terms
of this Agreement;
(c) HE HAS BEEN PROVIDED THE OPPORTUNITY TO TAKE UP TO
TWENTY-ONE (21) DAYS TO CONSIDER THIS AGREEMENT;
(d) HE SHALL HAVE THE RIGHT TO REVOKE THIS AGREEMENT WITHIN
SEVEN (7) DAYS FOLLOWING THE DATE HE EXECUTES THIS AGREEMENT. ANY
REVOCATION OF THIS AGREEMENT MUST BE IN WRITING AND RECEIVED BY THE
COMPANY WITHIN TEN (10) DAYS OF THE EXECUTION OF THIS AGREEMENT BY
CERTIFIED MAIL ADDRESSED TO XX. XXXXX X. XXXXX, III, 0000 XXXXXXXXX
XXXX, XXXXXXXX XXXXXXX, XXXXXXXXXX 00000; AND
(e) by signing this Agreement, he represents that he fully
understands the terms and conditions stated in it and intends to be
legally bound by them.
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If the Executive revokes this Agreement in the manner provided above, it
shall be void and of no effect, and shall not bind the Executive, the Company or
any of their respective affiliates.
8. Executive represents that he has not heretofore assigned or
transferred or purported to assign or transfer, to any person or entity, any of
the Claims, any portion thereof, or any interest therein.
9. Any breach by Executive of a condition of this Agreement with an
attendant failure to remedy the breach within ten (10) days of receiving notice
of it from the Company shall subject Executive to any and all equitable and/or
monetary relief required to prevent further damage to any of the Companies and
to compensate same for any damages suffered as a consequence of the breach of
this Agreement.
10. The Company may withhold from any payments made under this Agreement
all federal, state, local or other applicable taxes as shall be required by law.
11. This Agreement does not constitute nor shall it be construed as an
admission by the Company, its affiliates, subsidiaries, joint venturers, or
directors, officers, employees, agents, representatives or assigns of any
violation or noncompliance with any obligation, legal or otherwise.
12. The Parties to this Agreement agree not to disclose its terms or any
of the facts surrounding the Agreement and settlement, to any person or entity,
other than their attorney, accountants, financial advisors, or the members of
their immediate family; provided that this Agreement shall not be construed to
prohibit any disclosure required by law.
13. This Agreement shall be governed by, interpreted and construed in
accordance with the laws of the state of California.
14. The Parties intend that the invalidity or unenforceability of any
provision of this Agreement shall not affect or render invalid or unenforceable
any other provision.
15. It is the express intention of the Parties that this Agreement shall
operate as a sealed instrument.
16. This Agreement shall be binding upon and inure to the benefit of the
Parties and their heirs, administrators, representatives, executors, successors
and assigns.
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be
executed as of the day and year first above written.
CDRJ INVESTMENTS (Lux) SA
By: /s/ Xxxxx X. Xxxxx
--------------------------------
Name: Xxxxx X. Xxxxx, III
Title: Vice Chairman, Executive Vice
President and General Counsel
JAFRA WORLDWIDE HOLDINGS (Lux)
S.ar.l
By: /s/ Xxxxx X. Xxxxx
--------------------------------
Name: Xxxxx X. Xxxxx, III
Title: Vice Chairman, Executive
Vice President and General Counsel
CDRJ NORTH ATLANTIC (Lux) S.ar.l
By: /s/ Xxxxx X. Xxxxx
--------------------------------
Name: Xxxxx X. Xxxxx, III
Title: Vice Chairman, Executive Vice
President and General Counsel
JAFRA COSMETICS INTERNATIONAL, Inc.
By: /s/ Xxxxx X. Xxxxx
--------------------------------
Name: Xxxxx X. Xxxxx, III
Title: Vice Chairman, Executive Vice
President and General Counsel
EXECUTIVE
By: /s/ Xxxxx Xxxxx Guirao
--------------------------------
Name: Xxxxx Xxxxx Guirao
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XXXXX XXXXX GUIRAO (THE "EXECUTIVE")
TERMINATION BENEFITS
1. Upon a termination of employment by Jafra without Cause, the Executive is
entitled to receive the following payments and benefits under his Employment
Agreement:
- Base Salary (at current annualized rate of $528,715) through the date of
termination (i.e., through March 6, 2004). (SECTION 7(f)(i))
- Base Salary in installments (at current annualized rate of $528,715) for
a period of 2 years from date of termination (i.e., through March 6,
2006). (SECTION 7(f)(i)(A))
- If Jafra meets applicable performance objectives for 2004 under its
Bonus Plan, pro rata incentive bonus for 2004 (approx. $50,122, based on
2003 bonus). (SECTION 7(f)(i)(B))
- Continued participation in health plans for a period of 2 years from
date of termination (i.e., through March 6, 2006). (SECTION 7(f)(i))
- Any accrued benefits under other Jafra plan (other than bonus or
incentive plans) in which the Executive currently participates. (SECTION
7(f)(iii))
2. As further consideration for entering into the Confidential General Release
and Separation Agreement, the Executive is also entitled to receive the
following:
- A lump sum cash payment in an amount equal to $100,000 payable as soon
as practicable following the Termination Date.
- As soon as practicable following the 90th day after the execution by the
Parties of the Confidential General Release and Separation Agreement, a
lump sum cash payment in an amount equal to $100,000; provided that the
transfer of the Company's arrangements for manufacturing at the COSFRA
facility in Naucalpan, Mexico has been completed prior to such date.
- Reimbursement for the cost to Executive of one round-trip business class
airline ticket from Madrid, Spain to Los Angeles, California.
