Exhibit 10.66
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), is made as of January 1, 2002,
by and among Xxxxx X. Xxxx (the "Executive"), Donnkenny Apparel, Inc., a
Delaware corporation (the "Company"), and Donnkenny, Inc., a Delaware
corporation which is the parent corporation of the Company ("Donnkenny").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Board of Directors of the Company (the "Board") expects
that the Executive will make substantial contributions to the growth and
prospects of Donnkenny, the Company and their subsidiaries; and
WHEREAS, the Board desires to obtain for the Company the services of
the Executive, and the Executive desires to be employed by the Company, all on
the terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements of the parties and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Company and the
Executive Agree as follows:
1. Employment.
a. Position. On the terms and subject to the conditions set forth
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herein, the Company hereby employs the Executive as its Executive Vice President
and Chief Administrative Officer throughout the Employment Term (as
defined below). In addition, the Company shall continue to cause each of its
subsidiaries to designate Executive to the offices of Executive Vice President
and Chief Administrative Officer throughout the Employment Term. Donnkenny
hereby designates Executive as its Executive Vice President and Chief
Administrative Officer throughout the Employment Term and agrees that during the
Employment Term, it shall nominate the Executive for election to its Board of
Directors at each annual meeting of shareholders and use its best efforts to
cause the Executive to be duly elected to the Board at each such meeting.
b. Duties and Responsibilities. The Executive shall have such duties
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and responsibilities consistent with his position as the Board or Chief
Executive Officer determines and shall perform such duties and carry out such
responsibilities to the best of his ability for the purpose of advancing the
business of the Company and its subsidiaries and Donnkenny. Subject to the
provisions of Section 1.c. below, and excluding any periods of vacation and sick
leave to which Executive is entitled, during the Employment Term the Executive
shall devote his full business time, skill and attention to the business of the
Company and its subsidiaries and Donnkenny, and, except as specifically approved
by the Board, shall not engage in any other business activity or have any other
business affiliation. During the Employment Term, Executive shall report
directly to the Chief Executive Officer of Donnkenny and the Company. The
Executive shall not be required to perform the
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principal duties of his employment outside of the New York, New York
metropolitan area without the prior written consent of the Executive, which may
be delayed or withheld by Executive in his sole discretion, it being understood
however that Executive's position may require considerable domestic and
foreign travel.
c. Other Activities. Notwithstanding anything else to the contrary set
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forth herein, Executive shall have the right to manage his personal investments
and may participate fully in social, charitable and civic activities and may
serve on the boards of directors of other companies provided that such
activities do not unreasonably and materially interfere with the performance of
and do not involve a conflict of interest with his duties or responsibilities
hereunder; and further provided that the serving on boards of other companies,
or the rendering of services to other companies, will require the prior approval
of the Chief Executive Officer of Donnkenny.
Donnkenny and the Company each acknowledge that Executive currently has
a business interest in Retail Resources, LP ("Retail") which, from time to time
during normal business hours, shall require Executive to devote some of his time
to the discharge of certain duties.
2. Employment Term.
a. Initial Term. Subject to the termination provisions of Section 5
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hereof, the "Employment Term" hereunder shall be an ongoing and continuous
period of one (1) year, commencing on January 1, 2002, with the result that each
day subsequent to January 1, 2002 shall, without further action or notice of any
kind by any party hereto, be deemed to
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automatically extend the term hereof by one day so that, at all times
hereafter, the remaining term hereof shall be deemed to be one (1) year.
b. Expanded Term. In the event that Executive is employed by the
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Company under this Agreement on January 1, 2003, then the Employment Term will
immediately and without and further notice automatically convert to a two (2)
year term so that thereafter the Employment Term shall be an ongoing and
continuous period of two (2) years, commencing with January 1, 2003, with the
result that each day subsequent to January 1, 2003 shall, without further action
or notice of any kind by any party hereto, be deemed to automatically extend the
term hereof by one day so that, at all times after December 31, 2002, the
remaining term hereof shall be deemed to be two (2) years.
3. Compensation. During the Employment Term, the Company will pay
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and/or otherwise provide the Executive with compensation and related benefits as
follows:
a. Base Salary. During the year of the Employment Term ending December
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31, 2002, the Company agrees to pay the Executive, for services rendered
hereunder, a base salary at the annual rate of Four Hundred Thousand Dollars
($400,000) (the "Base Salary"). Commencing January 1, 2003 and on each January 1
thereafter during the Employment Term, the base salary which was in effect on
the immediately preceding December 31 shall be increased by the greater of (i)
the percentage increase in the Cost of Living Index (as hereafter defined); or
(ii) such higher rate as the Compensation Committee of the Board (the
"Compensation Committee") may designate in its sole and absolute discretion (the
adjusted base salary shall be deemed the effective "Base Salary" hereunder). The
Base Salary shall be payable in equal periodic installments, not less frequently
than monthly, less any sums which
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may be required to be deducted or withheld under applicable provisions
of law. The Base Salary for any partial year shall be prorated based upon the
number of days elapsed in such year. For purposes hereof, the Cost of Living
Index shall mean the December 2001 Revised Consumer Price Index ("CPI") for all
Urban Consumers published by the Bureau of Labor Statistics of the United States
Department of Labor, for New York City Metropolitan Area Average, All Items. If
the manner in which the CPI is calculated shall be substantially revised,
Executive and the Company shall select a means to adjust such revised Index
which would produce results equivalent, as practicable, to those which would
have been obtained if the CPI has not been so revised. If the CPI shall become
unavailable to the public because publication is discontinued, or otherwise,
Executive and the Company shall select a comparable substitute index based upon
changes in the cost of living or purchasing power of the consumer dollar
published by any other governmental agency, or, of no such index shall then be
available, a comparable index published by a major bank or other financial
institution or by a university or a recognized financial publication. In the
event that the U.S. Department of Labor, Bureau of Labor Statistics, changes the
publication frequency of the CPI so that a CPI is not available to make an
adjustment for the period in question, the adjustment shall be based on the
percentage increase in the CPI for the twelve (12) month period beginning with
the closest month preceding the period in question for which a CPI is available.
b. Bonus. During the Employment Term, Executive shall participate in
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any bonus plan that includes senior executives of the Company on the terms
generally set forth in such plan from time to time, or in any plan substituted
therefor or in addition thereto.
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c. Restricted Stock and Stock Options. In the event the Compensation
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Committee of Donnkenny shall grant to the Executive any award of restricted
shares of the Common Stock of Donnkenny, or options to purchase shares of
Donnkenny Common Stock, then with respect to the options, such options shall
remain exercisable during the remainder of their respective terms
notwithstanding any termination of the Executive's employment except as
otherwise provided in the grant agreements respecting such options; provided,
however, that, anything herein or in the grant agreements to the contrary
notwithstanding, the vesting of such shares of restricted stock shall be
accelerated in the event of a Change in Control (as defined herein), a
termination of Executive's employment by the Company without Cause (as defined
below), a termination of Executive's employment for Good Reason (as defined
below), or a termination of Executive's employment as a result of the death or
disability of Executive. With respect to the options, such options shall be
incentive stock options to fullest extent permitted by applicable law and the
Stock Option Plan.
In the event there shall be a Change in Control, all shares of common
stock of Donnkenny previously or subsequently issued to Executive as restricted
shares or pursuant to stock options upon the vesting thereof from time to time
shall be promptly and duly registered and fully and freely tradeable by
Executive without restriction at the sole cost and expense of the Company. In
the event Executive shall require a resale prospectus in connection with any
intended sale of shares, Donnkenny and the Company shall promptly furnish such
resale prospectus to Executive at the Company's expense.
d. Automobile Allowance. During the Employment Term the Company shall
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lease and provide to Executive an automobile whose monthly lease payment does
not exceed
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$1,200. In addition, the Company shall be responsible for the payment of (i)
automobile insurance, parking in one garage, maintenance, repairs and
similar expenses, and (ii) the federal, state and local income taxes for which
Executive is liable on account of the payments or other benefits referred to in
this Section 3d, together with an amount sufficient to satisfy any additional
federal, state or local income taxes for which Executive is liable on account of
the amounts received pursuant to this Section 3d, all of which shall be payable
within fifteen (15) days after demand therefor by Executive. In the event the
employment of Executive with the Company shall cease for any reason other than
the death or Disability (as hereinafter defined) of Executive, then Executive
shall assume, pay and perform, when due, all obligations under the lease for the
Company automobile provided to Executive hereunder for the remaining term
thereof.
e. Reimbursement of Expenses and Administrative Support. The Company
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shall pay or reimburse the Executive, upon the presentation of appropriate
documentation of such expenses, for all reasonable travel and other expenses
incurred by the Executive in performing his obligations under this Agreement.
The Company further agrees to furnish the Executive with office space and
administrative support, and any other assistance and accommodations as shall be
consistent with past practices reasonably required by the Executive in the
performance of his duties under this Agreement.
f. Vacation. Executive shall be entitled to four (4) weeks paid
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vacation in each calendar year. Any vacation for the current year to which
Executive is entitled and which has not been fully taken by Executive at the
time his employment with the Company shall
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terminate for any reason, shall be fully paid to Executive within thirty
(30) days after the effective date of Executive's termination of employment.
g. Financial Planning and Tax Preparation Services. Each year during
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the Employment Term, the Company shall pay or reimburse Executive for financial
planning services and tax preparation services provided to Executive in an
amount not to exceed Ten Thousand Dollars ($10,000.00), which amount shall be
payable upon submission of appropriate documentation .
h. Deductions. All payments made under this Agreement shall be subject
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to such deductions at the source as from time to time may be required to be made
pursuant to any law, rule, regulation or order.
i. Change in Control. For purposes of this Agreement, a "Change in
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Control" of the Company or Donnkenny shall be deemed to have occurred upon any
of the following events, provided that, as a result thereof, or in connection
therewith, or at any time thereafter, Executive shall no longer directly report
to Xxxxxx X. Xxxx ("Xxxx):
i. A person or entity or group of persons or entities, acting
in concert, shall become the direct or indirect beneficial
owner (within the meaning of Rule 13d-3 of the Securities
Exchange Act of 1934, as amended), of securities of the
Company or Donnkenny representing more than fifty percent
(50%) of the combined voting power of the issued and
outstanding common stock of Donnkenny or the Company; or
ii. The majority of the Board, or the majority of the board of
directors of Donnkenny, is no longer comprised of the
incumbent directors who constitute such
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board on the date of this Agreement and any other
individual(s) who becomes a director subsequent to the date
of this Agreement whose initial election or nomination for
election as a director, as the case may be, was approved by
at least a majority of the directors who comprised the
incumbent directors as of the date of such election or
nomination or subsequently elected directors elected by
directors elected by incumbent directors; provided however,
that in determining whether a director has been so elected
by the incumbent directors or their successors, a person who
has been so elected by reason of having made an investment
in the Company or Donnkenny or by reason of a transaction
agreement with Donnkenny or the Company, or otherwise in
connection with any Change in Control transaction with
Donnkenny or the Company, shall not be deemed to have been
elected by incumbent directors or their successors;
iii. The Board shall approve a sale of all or substantially all
of the assets of the Company, or the board of directors of
Donnkenny shall approve a sale of all or substantially all
of the assets of Donnkenny; or
iv. The Board, or the board of directors of Donnkenny, shall
approve any merger, consolidation, or like business
combination or reorganization of the Company, or of
Donnkenny, the consummation of which would result in the
occurrence of any event described in clause (A) or (B)
above, and such transaction shall have been consummated.
4. Participation in Benefit Plans. The Executive shall be entitled to
participate, during the term of this Agreement, in the Company's and Donnkenny's
benefit programs, including but
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not limited to qualified or non-qualified pension plans, other
qualified or nonqualified retirement plans, supplemental pension plans, group
hospitalization, health, dental care, death benefit, post-retirement welfare
plans, or other present or future group employee benefit plans or programs of
the Company or Donnkenny for which key executives are or shall become eligible
(collectively, the "Benefit Plans"), on the same terms as other key executives
of the Company or Donnkenny, as the case may be, on a company wide basis. If
participation in any of such Benefit Plans is subject to or based on length of
service, the Executive, upon execution of this Agreement, shall be credited with
the greater of (i) ten (10) years of service, or (ii) whatever number of years
or period of service shall be required in order for Executive to immediately
commence participation therein at any time hereafter. In addition to and without
limiting the generality of the foregoing, (i) the Company may obtain and
maintain a "key man" life insurance policy under which the Company is the named
beneficiary in such amount as is determined by the Company, and (ii) the
Executive may obtain and maintain, at the sole expense of the Company, a life
insurance policy with a death benefit of up to $2,000,000, which policy shall be
owned by the Executive or his designee and payable to Executive's designated
beneficiary, and/or may be a joint life insurance policy providing for payment
upon the last to die of Executive and Executive's spouse, in each case from a
nationally-recognized insurance carrier reasonably acceptable to the Executive,
and (iii) the Company shall use its reasonable best efforts to provide, in
addition to any such insurance regularly provided to the Company's executives
and/or employees, long-term disability insurance which will pay to Executive at
least sixty percent (60%) of Executive's then current Base Salary until the
Executive reaches age 65. Upon termination of the employment of the Executive
with the Company for any reason, the Executive shall be entitled to purchase
from the Company any life insurance policy then owned by the Company on the life
of the
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Executive and the aforementioned disability insurance policy (if
permitted under the terms of such policy) for a purchase price equal to the cash
surrender value of each policy, if any (net of any loans or other reductions in
value chargeable upon such surrender). The Company may not borrow against any
life insurance policy owned by the Company on the life of the Executive, or
pledge or otherwise encumber said policy or the death benefit payable thereunder
without the prior written consent of Executive, which consent may be delayed or
withheld in the Executive's sole discretion. The Company shall be responsible
for any federal, state and local income taxes for which Executive is liable on
account of the payment by the Company of premiums for the maintenance of the
benefits referred to in this Section 4 above, together with an amount sufficient
to satisfy any additional federal, state or local income taxes for which
Executive is liable on account of the tax reimbursement amounts received
pursuant to this Section 4, all of which shall be payable within fifteen (15)
days after demand therefor by Executive.
5. Termination of Employment.
a. By the Company For Cause. The Company may terminate the Executive's
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employment under this Agreement at any time for Cause (as defined below) by
delivery of written notice of termination to the Executive (which notice shall
specify in reasonable detail the basis upon which such termination is made and
the specific provision(s) of the Agreement upon which it relies, and further
stating the date, time and place of the special meeting of the Board or the
Board of Directors of Donnkenny at which the issue of Cause shall be addressed)
at least ten days prior to the termination date set forth in such notice. No
such termination shall become effective until the Executive, after receipt of
such notice, shall have been offered the opportunity to attend a meeting of the
Board of Directors of the
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Company (or the Board of Directors of Donnkenny, whichever is
applicable) at which a quorum is present (with the Executive's counsel present
and participating, if desired by the Executive) regarding such termination
notice and the allegations set forth therein and, based upon such meeting, such
Board of Directors shall have elected to proceed with such termination. Except
as provided for in Section 21 below, in the event the Executive's employment is
terminated for Cause, all provisions of this Agreement and the Employment Term
shall be terminated; provided, however, that such termination shall not divest
the Executive of any previously vested benefit or right. In addition, the
Executive shall be entitled only to payment of his earned and unpaid Base Salary
to the date of termination, earned and unpaid bonus for the prior fiscal year,
additional salary payments in lieu of the Executive's accrued and unused
vacation, unreimbursed business and entertainment expenses in accordance with
the Company's policy, and unreimbursed medical, dental and other employee
benefit expenses incurred (including any tax gross-up payments required
hereunder), and other vested and accrued benefits payable in accordance with the
Company's or Donnkenny's employee benefit plans (hereinafter referred to as the
"Standard Termination Payments"). For purposes of this Agreement, "Cause" means
(1) the conviction of the Executive for the commission of (A) any felony, or (B)
a misdemeanor involving moral turpitude, or (2) willful misconduct or neglect of
duties by the Executive that results in material and demonstrable damage to the
business or reputation of the Company or (3) Executive's repeated failure to
follow a written Company policy previously delivered to Executive, or (4)
Executive's alcohol or drug abuse. No act or failure to act on the part of the
Executive shall be considered "willful" unless it is done, or omitted to be
done, by the
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Executive in bad faith or without reasonable belief that the
Executive's action or omission was in the best interests of the Company. Any act
or failure to act that is based upon authority given pursuant to a resolution
duly adopted by the Board or the Board of Directors of Donnkenny, or the written
advice of counsel for the Company or Donnkenny, shall be conclusively presumed
to be done, or omitted to be done, by the Executive in good faith and in the
best interests of the Company.
b. Upon Death or Disability. If the Executive dies, all provisions of
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this Agreement (other than rights or benefits arising as a result of such death)
and the Employment Term shall be automatically terminated; provided, however,
that the Standard Termination Payments and pro rata Bonus for the fiscal year
during which such death occurs shall be paid to the Executive's surviving spouse
or, if none, his estate, and the death benefits under the Company's and
Donnkenny's employee benefit plans shall be paid to the Executive's beneficiary
or beneficiaries as properly designated in writing by the Executive. If the
Executive is unable to perform his responsibilities under this Agreement by
reason of physical or mental disability or incapacity and such disability or
incapacity shall have continued for six consecutive months or any period
aggregating six months within any 12 consecutive months (a "Disability'), the
Company may terminate this Agreement and the Employment Term at any time
thereafter. In such event, the Executive shall be entitled to receive his normal
compensation hereunder during said six (6) month period, and shall thereafter be
entitled to receive the Standard Termination Payments and the pro rata Bonus for
the fiscal year during which such disability occurs. Pro rata Bonus, in the
event of the Executive's death or disability, shall be an amount equal to the
Bonus at the amount payable
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upon fully achieving the figure targeted in the annual business plan or
other documents relating to the Bonus approved by the Board, the Compensation
Committee or any other duly authorized designee of the Board for such year (the
"Target Amount") (regardless of the Company's actual performance) for the fiscal
year during which such death or disability occurs, prorated by a fraction, the
numerator of which is the number of days of employment elapsed during the fiscal
year prior to termination of employment and the denominator of which is 365. A
termination of the Executive's employment by the Company for Disability shall be
communicated to the Executive by written notice, and shall be effective on the
30th day after receipt of such notice by the Executive (the "Disability
Effective Date"), unless the Executive returns to full-time performance of the
Executive's duties before the Disability Effective Date.
The Company shall continue to provide the Executive and the spouse and
dependents of the Executive, at the expense of the Company, with the medical
insurance then provided to Executive and to such spouse and dependents
including, without limitation, the Company's Execucare Program or any addition
thereto or substitution therefor, for a period of three (3) years following the
termination of the employment of the Executive, which medical insurance coverage
shall be included as part of any required COBRA Coverage; provided, however,
that the Company provided medical coverage and the COBRA Coverage shall
terminate with respect to the Executive, the spouse and/or dependents of the
Executive as of the date that any such individual becomes eligible to receive
coverage and benefits as a full time employee under any plans, programs and/or
arrangements of a subsequent employer of Executive. Availability for coverage as
a spouse, principal or director of a company shall not
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be treated as eligibility for coverage within the meaning of this
paragraph. Subject to the provisions of this Agreement, which shall control in
the event of any conflicting provisions, the rights and benefits of the
Executive under the benefit plans and programs of the Company shall be
determined in accordance with the provisions of such plans and programs. The
rights and benefits of the Executive with respect to the shares of restricted
stock and options referred to in Section 3.c. above shall be determined in
accordance with the provisions of this Agreement and the plans and grant
agreements governing such shares and options. Except as otherwise specified in
this Agreement, neither the Executive nor the Company shall have any further
rights or obligations under this Agreement.
c. By the Company Without Cause.
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i. The Company may only terminate the employment of the
Executive for Cause or upon the death or Disability of the
Executive. If the employment of the Executive shall be
terminated without Cause and prior to a Change in Control
and other than as a result of death or Disability of the
Executive, then the Executive shall be entitled to the
payments, rights and benefits set forth in Section 5.d.v.
below.
d. By the Executive.
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i. The Executive may terminate his employment, and any further
obligations which Executive may have to perform services on
behalf of Donnkenny or the Company and any of its
subsidiaries hereunder at any time after the date hereof,
(i) without Good Reason (as defined below) by sending
written notice of such termination to the Company not less
than sixty (60) days prior to the effective date of such
termination (during such sixty (60) day period, the
Executive shall continue to
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perform the normal duties of his employment hereunder and
shall be entitled to receive when due all compensation and
benefits applicable to the Executive hereunder); or (ii) for
Good Reason pursuant to the procedure set forth in Section
5(d)iii below).
ii. For purposes of this Agreement, "Good Reason" shall be
defined as any of the following:
A. failure by the Company or Donnkenny to re-elect the
Executive as a director, Executive Vice President and
Chief Administrative Officer or to an office of equal
or greater prominence, or the assignment to the
Executive of any duties or responsibilities
inconsistent in any material respect with those
customarily associated with the positions to be held by
the Executive pursuant to this Agreement;
B. any failure by the Company or Donnkenny to comply with
any provision of Section 3 of this Agreement, other
than an isolated, insubstantial and inadvertent failure
that is not taken in bad faith and is remedied by the
Company or Donnkenny, as the case may be, promptly
after receipt of notice thereof from the Executive;
C. any requirement by the Company that the Executive's
services be rendered primarily at a location or
locations other than in New York City;
D. any purported termination of the Executive's employment
by the Company or Donnkenny for a reason or in a manner
not expressly permitted by this Agreement;
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E. any failure by the Company or Donnkenny to comply with
Section 10 of this Agreement;
F. any requirement that Executive report to a person other
than Levy, as Chief Executive Officer of the Company
and Donnkenny, in the circumstance where Levy remains
in the employ of the Company and Donnkenny;
G. the termination of Levy's employment as Chief Executive
Officer of the Company for any reason whatsoever prior
to a Change In Control, provided that Executive has
remained in the full time active employment of the
Company hereunder for a period of six (6) months
immediately following the effective date of Levy's
employment termination;
H. the institution of bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings by
or against the Company or Donnkenny (which proceedings,
if instituted against the Company or Donnkenny, have
been consented to by the Company or Donnkenny, as the
case may be, or have remained undismissed for a period
of sixty (60) days after the filing date thereof); or
I. any other material breach of this Agreement by the
Company or Donnkenny that either is not taken in good
faith or is not remedied by the Company or Donnkenny,
as the case may be, within twenty(20) business days
after receipt of notice thereof from the Executive;
provided, however, that with respect to any breach of a
payment obligation of the Company or
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Donnkenny, such breach must be remedied within five (5)
business days after written notice thereof from the
Executive.
iii. A termination of employment by the Executive for Good Reason shall
be effectuated by giving the Company written notice ("Notice of Termination for
Good Reason") of the termination, setting forth in reasonable detail the
specific conduct of the Company or other event(s) that constitutes Good Reason
and the specific provision(s) of this Agreement on which the Executive relies
with such notice to be provided within 90 days of such alleged conduct or other
event. A termination of employment by the Executive for Good Reason shall be
effective on the fifth business day following the date when the Notice of
Termination for Good Reason is given, unless the notice sets forth a later date
(which date shall in no event be later than thirty (30) days after the notice is
given. Upon the occurrence of a termination of employment by the Executive for
Good Reason prior to a Change in Control, the Company shall pay to the Executive
the Standard Termination Payments and the Additional Termination Payments.
iv. If the Executive shall elect to terminate his employment hereunder
(other than as a result of his death or disability) without Good Reason, then
the Executive shall remain vested in all vested benefits provided for hereunder
or under any benefit plan of the Company in which Executive is a participant and
shall be entitled to receive the Standard Termination payments, but the Company
shall have no further obligation to make payments or provide benefits to the
Executive.
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v. If, on or before December 31, 2002, the Company terminates the
Executive's employment other than for Cause, death or Disability, or the
Executive terminates employment for Good Reason, the Company shall continue to
pay to the Executive the sum of (x) the aggregate Base Salary Executive would
have been entitled to receive during the twelve (12) month period following such
termination (assuming for these purposes, that Executive would have remained in
the full and continuous employment of the Company during such twelve (12) month
period, and that Base Salary shall not increase above the rate in effect at the
date of termination); or if, on or after January 1, 2003, the Company terminates
the Executive's employment other than for Cause, death or Disability, or the
Executive terminates employment for Good Reason, the Company shall continue to
pay to the Executive the sum of (x) the aggregate Base Salary Executive would
have been entitled to receive during the twenty-four (24) month period following
such termination (assuming for these purposes, that Executive would have
remained in the full and continuous employment of the Company during such
twenty-four (24) month period, and that Base Salary shall not increase above the
rate in effect at the date of termination); and in either the case of
termination as described above whether on or before December 31, 2002 or on or
after January 1, 2003 also shall pay Executive (y) a one time payment which is
equal to the maximum Bonus payable to Executive upon fully achieving the figure
targeted in the annual business plan or other documents relating to the Bonus
approved by the Board, the Compensation Committee or any other duly authorized
designee of the Board for the year in which
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such employment termination occurs (regardless of the Company's actual
performances) or, in the event no such figure shall be targeted for such year,
for the most recent year with respect to which such figure was targeted (the sum
of (x) and (y) are hereinafter collectively referred to as the "Additional
Termination Payments"). when same would otherwise be due and payable in the
ordinary cause of business assuming, for these purposes, that Executive remained
in the full time continuous employment of the Company during such period On or
before the effective termination date under this 5.d.v., the Company, at its
expense, shall deliver to Executive a bank letter of credit in an amount equal
to the aggregate payments to be received by Executive hereunder, naming
Executive as beneficiary and issued by the Bank which is then providing
financing for the Company or such other bank reasonably approved by Executive on
terms and conditions which are reasonably approved by Executive, or secured by
such other collateral which is not subject to the claims of the creditors of the
Company as Executive shall approve in Executive's sole discretion, the value of
which shall be 100% of the aggregate payments to be received by Executive. In
the event the payment obligations hereunder shall be secured by collateral other
than a bank letter of credit, and in the event the fair market value of such
collateral shall fall below the then remaining balance of the amounts payable to
Executive, then, within five (5) business days after written notice thereof, the
Company shall deliver to Executive such additional or substituted collateral
which, in the aggregate with any collateral to be continually held by Executive,
has a value which shall be not less than 100% of the remaining payments to be
made to
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Executive. In the event there shall be any default in payment of any installment
of the Additional Termination Payments which is not cured within five (5)
business days after written notice thereof, or in the event additional or
substituted collateral shall not be timely delivered to Executive as provided
for above, then the remaining unpaid balance thereof shall be immediately due
and payable without further notice and, among other things, Executive shall have
the unrestricted right to proceed against the letter of credit or other
collateral, as the case may be.
vi. In addition to the foregoing, the Company shall also be obligated
to pay to the Executive the Standard Termination Payments as and when they shall
become due. Furthermore, the Company shall continue to provide the Executive and
the spouse and dependents of the Executive, at the expense of the Company, with
the medical insurance then provided to Executive and his spouse and dependents
including, without limitation, the Company's Execucare Program or any addition
thereto or substitution therefor, for a period of three (3) years following the
termination of the employment of the Executive, which medical insurance coverage
shall be included as part of any required COBRA Coverage; provided, however,
that the Company provided medical coverage and the COBRA Coverage shall
terminate with respect to the Executive, the spouse and/or dependents of the
Executive as of the date that any such individual becomes eligible for coverage
and benefits as a full time employee under any plans, programs and/or
arrangements of a subsequent employer of Executive. Availability for coverage as
a spouse, principal or director of a company shall not be treated as eligibility
for coverage within the meaning of this
21
paragraph. The rights and benefits of the Executive with respect to the
shares of restricted stock and options referred to in Section 3.c. above shall
be determined in accordance with the provisions of this Agreement and the plans
and grant agreements governing such shares and options; provided, however, that
in the event there shall be a conflict between the terms of this Agreement and
the terms of any such plan or grant agreement, then the provisions of this
Agreement shall govern and control. Except as otherwise specified in this
Agreement, neither the Executive nor the Company shall have any further rights
or obligations under this Agreement. The payments and benefits provided pursuant
to this Section 0.x.xx. are intended as liquidated damages for a termination of
the Executive's employment by the Company other than for Cause or Disability or
for the actions of the Company leading to a termination of the Executive's
employment by the Executive for Good Reason and shall be the sole and exclusive
remedy therefor. Executive shall have no obligation whatsoever to mitigate any
damages, costs or expenses suffered or incurred by the Company with respect to
any payments made pursuant to this Section 5.d., and no such payment shall be
subject to any cancellation, reduction, offset, rebate or repayment as a result
of any subsequent employment or other business activity by the Executive
including, without limitation, self employment, except for such deductions at
the source as from time to time may be required to be made pursuant to any law,
rule, regulation or order.
vii. Anything in this Agreement to the contrary notwithstanding, if,
during the Employment Term the Executive's employment is terminated by the
Executive
22
for any or no reason or by the Company other for Cause, death or
Disability, and such termination shall occur upon or after the occurrence of a
Change in Control, and Levy shall either have given notice of his resignation
from the employ of the Company, shall have received a notice of termination of
employment from the Company or Donnkenny or shall no longer be employed by the
Company or Donnkenny, the Company shall pay to the Executive, by wire transfer
of immediately available funds within ten (10) days after the Executive's
Termination Date, an amount equal to the sum of (x) two times the amount of
annual Base Salary of Executive in effect on the Date of Termination; and (y)
two times the amount of Bonus included within the determination of Additional
Termination Payments hereunder (the "Change in Control Payment"). In addition to
the foregoing, the Company shall also be obligated to pay to the Executive the
Standard Termination Payments as and when they shall become due.
Anything in this Section 5.d.vii. to the contrary notwithstanding,
subsequent to the consummation of the Change in Control transaction and, within
thirty (30) days after Executive's termination of employment with the Company
which gives rise to a payment obligation by the Company under this Section
5.d.vii., the Company shall have the right to elect to pay to the Executive (and
to the Executive's surviving spouse in the event of Executive's death or, if no
spouse shall then be surviving, to Executive's estate) the amount of the Change
in Control Payment in twenty-four (24) equal or substantially equal consecutive
monthly installments, commencing on the first day of the month immediately
succeeding the Termination Date and on the first
23
day of each month thereafter, without interest, provided that the
Company has first provided to Executive, and maintains in full force and effect
during the entire twenty-four (24) month period referred to above, at the
Company's expense, a bank letter of credit (with Executive as beneficiary) or
other collateral security for such payment which is not subject to the claims of
the Company's creditors and which is in an amount that is equal (in the case of
the bank letter of credit) to the unpaid balance of the Change in Control
Payment or (in the case of collateral other than the bank letter of credit)
which is equal to 100% in value of the unpaid balance of the Change in Control
Payment. The election provided for above shall be effective only if Executive
receives written notice thereof within the aforesaid thirty (30) day period.
Executive will have the right to reasonably approve the financial institution
issuing any such letter of credit and the terms thereof, as well as the form of
other security or the terms of any pledge relating thereto; provided that if the
financial institution is the institution then providing financing for the
Company, said institution shall be deemed approved for purposes of this
paragraph. In the event there shall be any default in payment of any installment
of the Change in Control Payment which is not cured within five (5) business
days after written notice thereof, or in the event additional or substituted
collateral shall not be timely delivered to Executive as provided for above,
then the remaining unpaid balance thereof shall be immediately due and payable
without further notice and, among other things, Executive shall have the
unrestricted right to proceed against the letter of credit or other collateral,
as the case may be.
24
The Company shall continue to provide the Executive and the spouse and
dependents of the Executive, at the expense of the Company, with the medical
insurance then provided to Executive and his spouse and dependents including,
without limitation, the Company's Execucare Program or any addition thereto or
substitution therefor, for a period of three (3) years following the termination
of the employment of the Executive, which medical insurance coverage shall be
included as part of any required COBRA Coverage; provided, however, that the
Company provided medical coverage and the COBRA Coverage shall terminate with
respect to the Executive, the spouse and/or dependents of the Executive as of
the date that any such individual becomes eligible to receive coverage and
benefits under any plans, programs and/or arrangements of a subsequent employer.
Availability for coverage as a spouse, principal or director of a company shall
not be treated as eligibility for coverage absent full time employment. Subject
to the provisions of this Agreement, which shall control in the event of any
conflicting provisions, the rights and benefits of the Executive under the
benefit plans and programs of the Company shall be determined in accordance with
the provisions of such plans and programs. The rights and benefits of the
Executive with respect to the shares of restricted stock and options referred to
in Section 3.c. above shall be determined in accordance with the provision of
this Agreement and the plans and grant agreements governing such shares and
options; provided, however, that in the event there shall be a conflict between
the terms of this Agreement and the terms of any such plan or grant agreement,
then the provisions of this Agreement shall govern and control. Except as
otherwise
25
specified in this Agreement, neither the Executive nor the Company
shall have any further rights or obligations under this Agreement. The payments
and benefits provided pursuant to this Section 0.x.xx. are intended as
liquidated damages for a termination of the Executive's employment by the
Company other than for Cause or Disability or for the actions of the Company
leading to a termination of the Executive's employment by the Executive for Good
Reason, in each case in connection with, on or after the occurrence of a Change
in Control, and shall be the sole and exclusive remedy therefor. Executive shall
have no obligation whatsoever to mitigate any damages, costs or expenses
suffered or incurred by the Company with respect to any payments made pursuant
to this Section 0.x.xx., and no such payment shall be subject to any
cancellation, reduction, offset, rebate or repayment as a result of any
subsequent employment or other business activity by the Executive including,
without limitation, self employment, except for such deductions at the source as
from time to time may be required to be made pursuant to any law, rule,
regulation or order.
Notwithstanding the foregoing, if the aggregate value of all payments
to be received by the Executive in connection with a Change in Control would be
subject to excise tax under Internal Revenue Code Section 4999 and any successor
provision, or any comparable provision of state or local tax law, then the
payments to the Executive will be reduced to an amount sufficient to eliminate
any excise tax, but only if, after such reduction, the Executive would be placed
in a better after-tax financial position than the Executive would otherwise be
in had no reduction occurred.
26
e. No Waiver. The failure to set forth any fact or circumstance in a
---------
Notice of Termination for Cause or a Notice of Termination for Good Reason shall
not constitute a waiver of the right to assert, and shall not preclude the party
giving notice from asserting, such fact or circumstance in an attempt to enforce
any right under or provision of this Agreement.
f. Date of Termination. The "Date of Termination" means the date of the
-------------------
Executive's death, the Disability Effective Date, the date on which the
termination of the Executive's employment by the Company for Cause or without
Cause or by the Executive for Good Reason is effective, or the date on which the
Executive gives the Company notice of a termination of employment without Good
Reason, as the case may be.
6. Non-Exclusivity of Rights. Nothing in this Agreement shall prevent
-------------------------
or limit the Executive's continuing or future participation in any plan,,
program, policy or practice provided by the Company or any of its affiliated
companies for which the Executive may qualify, nor shall anything in this
Agreement limit or otherwise affect such rights as the Executive may have under
any contract or agreement with the Company or any of its affiliated companies.
Vested benefits and other amounts that the Executive is otherwise entitled to
receive under the Restricted Stock Plan, the Stock Option Plan, or any other
plan, policy, practice or program of, or any contract of agreement (including
this Agreement) with, the Company or any of its affiliated companies on or after
the Date of Termination shall be payable in accordance with the terms of each
such plan, policy, practice, program, contract or agreement, as the case may be.
7. Inventions. Any and all inventions, innovations or improvements
----------
("inventions") made, developed or created by the Executive (whether at the
request or suggestion of the Company
27
(which, as used in this Section 7, shall be deemed to include the
Company and each of its subsidiaries) or otherwise, whether alone or in
conjunction with others, and whether during regular hours of work or otherwise)
during the period of his employment with the Company which may be directly or
indirectly useful in, or relate to, the business of the Company, shall be
promptly and fully disclosed by the Executive to the Board and shall be the
Company's exclusive property as against the Executive, and the Executive shall
promptly deliver to an appropriate representative of the Company as designated
by the Board all papers, drawings, models, data and other material relating to
any inventions made, developed or created by him as aforesaid. The Executive
shall, at the request of the Company and without any payment therefor, execute
any documents necessary or advisable in the opinion of the Company's counsel to
direct issuance of patents or copyrights to the Company with respect to such
inventions as are to be the Company's exclusive property as against the
Executive or to vest in the Company title to such inventions as against the
Executive. The expense of securing any such patent or copyright shall be borne
by the Company.
8. Confidential Information. The Executive shall hold in strict
-------------------------
confidence all secret or confidential information, knowledge or data relating to
the Company or any of its affiliated companies and their respective businesses
that the Executive obtains during the Executive's employment by the Company or
any of its affiliated companies; provided, however, that Executive's obligations
under this Section 8 with respect to any specific Confidential Information shall
cease when that specific Confidential Information becomes public knowledge
(other than as a result of the Executive's violation of this Section 8)
("Confidential Information") or when it is disclosed by any person, firm,
corporation or business entity which is not bound by the terms of a
confidentiality agreement with the Company which contains substantially
identical provisions as the terms hereof.
28
Except as is otherwise provided for herein, the Executive shall not
communicate, divulge or disseminate Confidential Information at any time during
or after the Executive's employment with the Company, except with the prior
written consent of the Company or as otherwise required by law or regulation or
by legal process. If the Executive is requested pursuant to, or required by,
applicable law or regulation or by legal process to disclose any Confidential
Information, the Executive shall provide the Company, as promptly as the
circumstances reasonably permit, with notice of such request or requirement and,
unless a protective order or other appropriate relief is previously obtained,
the Confidential Information, subject to such request, may be disclosed pursuant
to and in accordance with the terms of such request or requirement, provided
that the Executive, at the Company's expense, shall use his best efforts to
limit any such disclosure to the precise terms of such request or requirement.
9. Non-Competition. The Executive acknowledges that the services to be
---------------
rendered by him to the Company (which, as used in this Section 9 shall be deemed
to include the Company and each of its subsidiaries) are of a special and unique
character. In consideration of his employment hereunder, the Executive agrees,
for the benefit of the Company, that he will not, during the term of this
Agreement and (except in a case where the Executive's employment is terminated
(x) by the Company other than for Cause, (y) by the Executive for Good Reason,
or (z) by the Executive or the Company for any or no reason following the
occurrence of a Change in Control which entitles Executive to a Change in
Control Payment) thereafter until the expiration of a period of twelve (12)
months commencing on the date of termination of his employment with the Company
(a) engage, directly or indirectly, whether as principal, agent, distributor,
representative, consultant, employee, partner, stockholder, limited partner or
other investor (other than an investment of not more than (i)
29
five percent (5%) of the stock or equity of any corporation the capital
stock of which is publicly traded or (ii) five percent (5%) of the ownership
interest of any limited partnership or other entity) or otherwise, within the
United States of America, in any apparel business which is competitive with the
business now, or at any time during the term of this Agreement, conducted by the
Company, (b) solicit or entice to endeavor to solicit or entice away from the
Company or hire any person who was or is an officer, employee or sales
representative of the Company within the ninety (90) day period immediately
preceding Executive's termination of employment, either for his own account or
for any individual, firm or corporation, whether or not such person would commit
any breach of his contract of employment by reason of leaving the service of the
Company, and the Executive agrees not to employ, directly or indirectly, any
person who was an officer, employee or sales representative of the Company or
who by reason of such position at any time is or may be likely to be in
possession of any confidential information or trade secrets relating to the
businesses or products of the Company; or (c) solicit or entice or endeavor to
solicit or entice away from the Company any customer or prospective customer of
the Company, either for his own account or for any individual, firm or
corporation with respect to the business of the Company. In addition, the
Executive shall not, at any time during the term of this Agreement or at any
time thereafter, engage in the business which uses as its name, in whole or in
part, Donnkenny, or any other trade name or trademark or corporate name used by
Donnkenny, the Company or any of their subsidiaries during the Employment Term.
10. Indemnification.
a. The Company and Donnkenny shall indemnify the Executive to the
fullest extent permitted by Delaware law in effect as of the date hereof against
all costs, expenses, liabilities and losses (including, without limitation,
attorneys' fees, judgments, fines,
30
penalties, ERISA excise taxes, penalties and amounts paid in
settlement) reasonably incurred by the Executive in connection with a
Proceeding. For the purposes of this Section 10a. "Proceeding" shall mean any
action, suit or proceeding, whether civil, criminal, administrative or
investigative, in which the Executive is made, or is threatened to be made, a
party to, or a witness in, such action, suit or proceeding by reason of the fact
that he is or was an officer, director or employee of the Company or Donnkenny,
or is or was serving as an officer, director, member, employee, trustee or agent
of any other entity at the request of the Company or Donnkenny, whether or not
the basis of such Proceeding arises out of or in connection with the Executive's
alleged action or omission in an official capacity.
b. The Company and Donnkenny shall advance to the Executive all
reasonable costs and expenses incurred by him in connection with a Proceeding
within 20 days after receipt by the Company or Donnkenny, as the case may be, of
a written request for such advance. Such request shall include an itemized list
of the costs and expenses and an undertaking by the Executive to repay the
amount of such advance if it shall ultimately be determined that he is not
entitled to be indemnified against such costs and expenses. Upon a request under
subsection (b), the Executive shall be deemed to have met the standard of
conduct required for such indemnification unless the contrary shall be
established by a court of competent jurisdiction.
c. The Executive shall not be entitled to indemnification under this
Section 10 unless he meets the standard of conduct specified in the Delaware
General Corporation Law. Any indemnification under subsection a. (unless ordered
by a court) shall be made by the Company or Donnkenny only as authorized in the
specific case upon a determination that
31
indemnification of the Executive is proper in the circumstances because
he has met the applicable standard of conduct set forth in the Delaware
Corporation Law. Such determination shall be made (1) by the Board or the Board
of Directors of Donnkenny, as the case may be, by a majority vote of a quorum
consisting of directors who were not parties to such Proceeding, or (2) if such
a quorum is not obtainable, or, even if obtainable a quorum of disinterested
directors so directs, by independent legal counsel in a written opinion, or (3)
by the stockholders.
d. Neither the Company nor Donnkenny shall settle any Proceeding or
claim in any manner which would impose on the Executive any penalty or
limitation without his prior written consent. Neither the Company nor Donnkenny
nor the Executive will unreasonably withhold its or his consent to any proposed
settlement.
e. The indemnification in this Section 10 shall inure to the benefit of
the Executive's heirs, executors and administrators.
f. The Company and Donnkenny agree to use their respective best efforts
to obtain, continue and maintain an adequate directors and officers' liability
insurance policy and shall cause such policy to cover the Executive to the
extent the Company or Donnkenny provides such coverage for its other executive
officers. Upon request by Executive, the Company and Donnkenny shall furnish
Executive with written evidence that such coverage is in full force and effect.
g. Donnkenny and the Company agree to indemnify and hold Executive
harmless from all losses, costs, fees and expenses including, without
limitation, reasonable legal fees and litigation expenses, which Executive shall
suffer, sustain or incur as a result of,
32
in connection with or arising from any breach of this Agreement by Donnkenny or
the Company.
11. Attorneys' Fees. The Company agrees to pay, as incurred, all legal fees and
expenses incurred by the Company and the Executive in connection with the
preparation of this Agreement. The Company further agrees to pay, if and only if
the Executive prevails in any contest, to the fullest extent permitted by law,
all legal fees and expenses that the Executive may reasonably incur as a result
of any contest by Donnkenny, the Company, the Executive or others of the
validity or enforceability of or liability under, or otherwise involving, any
provision of this Agreement, together with interest on any delayed payment at
the applicable federal rate provided for in Section 7872(f)(2)(A) of the Code.
12. Successors; Beneficiaries.
-------------------------
a. This Agreement is personal to the Executive and, without the prior
written consent of the Company, shall not be assignable by the Executive
otherwise than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of and be enforceable by the Executive's legal
representatives.
b. This Agreement shall inure to the benefit of and be binding upon the
Company and its successors and assigns.
c. The Company or Donnkenny, as the case may be, shall require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Company or Donnkenny expressly to assume and agree to perform this Agreement in
the same manner and to the same extent that Donnkenny or the Company would have
been required to perform it if no such succession
33
had taken place; provided, however, that no such assignment or transfer
shall have the effect of releasing or relieving Donnkenny or the Company of any
liability or obligation to the Executive hereunder or in any other agreement,
plan or document contemplated herein. As used in this Agreement, "Company" shall
mean both the Company as defined above and any such successor that assumes and
agrees to perform this Agreement, by operation of law or otherwise and
"Donnkenny" shall mean both Donnkenny as defined above and any such successor
that assumes and agrees to perform this Agreement by operation of law or
otherwise.
13. The Executive shall be entitled, to the extent permitted under any
applicable law, to select and change the beneficiary or beneficiaries to receive
any compensation or benefit payable hereunder following the Executive's death by
giving the Company written notice thereof. In the event of the Executive's death
or a judicial determination of his incompetence, reference in this Agreement to
the Executive shall be deemed, where appropriate, to refer to his beneficiary,
estate or other legal representative.
14. Notices. All notices and other communications under this Agreement
shall be in writing and shall be given by hand delivery to the other party or by
registered or certified mail, return receipt requested, postage prepaid or by
overnight mail, addressed as follows:
If to the Executive:
Xx. Xxxxx X. Xxxx
XX Xxx 0000
Xxx Xxxxx Xxxxxxx
Xxxxxxxxxx, Xxx Xxxx 00000
34
With a copy to:
Xxxxx Xxxxxxx
Suite 1800
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxxx, Esq.
If to Donnkenny or the Company:
Donnkenny Apparel, Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Chief Executive Officer
or to such other address as either party furnishes to the other in writing in
accordance with this Section 13. Notices and communications shall be effective
when actually received by the addressee.
15. Modification or Waiver. No amendment, modification, waiver,
termination or cancellation of this Agreement shall be binding or effective for
any purpose unless it is made in a writing signed by the party against whom
enforcement of such amendment, modification, waiver, termination or cancellation
is sought. No course of dealing between or among the parties to this Agreement
shall be deemed to affect or to modify, amend or discharge any provision or term
of this Agreement. No delay on the part of Donnkenny, the Company or the
Executive in the exercise of any of their respective rights or remedies shall
operate as a waiver thereof, and no single or partial exercise by Donnkenny, the
Company or the Executive of any such right or remedy shall preclude other or
further exercises thereof. A waiver of a right or remedy on any one occasion
shall not be construed as a bar to or waiver of any such right or remedy on any
other occasion.
16. Governing Law; Jurisdiction. This Agreement and all rights,
remedies and obligations hereunder, including, but not limited to, matters of
construction, validity and
35
performance shall be governed by the laws of the State of New York
without regard to its conflict of laws principles or rules.
17. Severability. Whenever possible each provision and term of this
Agreement shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision or term of this Agreement shall be
held to be prohibited by or invalid under such applicable law, then such
provision or term shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating or affecting in any manner whatsoever the
remainder of such provisions or term or the remaining provisions or terms of
this Agreement.
18. Counterparts. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same Agreement.
19. Headings. The headings of the Sections of this Agreement are
inserted for convenience only and shall not be deemed to constitute a part
hereof and shall not affect the construction or interpretation of this
Agreement.
20. Entire Agreement. This Agreement (together with all documents and
instruments referred to herein) constitutes the entire agreement and supersedes
all other prior agreements and undertakings, both written and oral, among the
parties with respect to the subject matter hereof.
21. Arbitration. If any controversy or dispute shall arise between the
parties hereto in connection with, arising from, or in respect to this
Agreement, any provision hereof, or any provision of any instrument, document,
agreement or other writing delivered pursuant hereto, or with respect to the
validity of this Agreement or any such document, agreement or other writing, and
if such controversy or dispute shall not be resolved within thirty (30) days
after the same shall arise, then
36
such dispute or controversy shall be submitted for arbitration to the
New York, New York office of the American Arbitration Association in accordance
with its commercial arbitration rules then in effect. Any such dispute or
controversy shall be determined by one (1) arbitrator. Such arbitrator may award
any relief which such arbitrator shall deem proper in the circumstances, without
regard to the relief which would otherwise be available to either party hereto
in a court of law or equity, including, without limitation, an award of money
damages (including interest on unpaid amounts, calculated from the due date of
any such amount, at a rate per annum determined by said arbitrator), specific
performance and injunctive relief. The award and findings of such arbitrator
shall be conclusive and binding upon the parties thereto, and judgment upon such
award may be entered in any court of competent jurisdiction. Any party against
whom an arbitrator's award shall be issued shall not, in any manner, oppose or
defend against any suit to confirm such award, or any enforcement proceedings
brought against such party, whether within or outside of the United States of
America, with respect to any judgment entered upon the award, and such party
hereby consents to the entry of a judgment against such party, in the full
amount thereof, or other relief granted therein, in any jurisdiction in which
such enforcement is sought.
22. Survival. The respective obligations of Donnkenny and the Company
and the Executive under Sections 5 (with respect to amounts owing as a result of
any termination), 6, (with respect to amounts owing), 7, 8, 9, 10, 11, 12, 13,
21 or this Section 22 shall survive any termination of Executive's employment;
provided, however, that the Executive's obligations under Section 9
(Non-Competition) shall terminate and shall not survive in the event (i) the
Executive's employment is terminated by the Company other than for Cause or by
the Executive for Good Reason, or (ii) the
37
Executive's employment is terminated for any or no reason following a
Change in Control which entitles Executive to a Change in Control Payment.
23. Conflicting Terms. In the event any of the terms of this Agreement
shall conflict with any of the terms of any benefit plan of the Company or
Donnkenny in which Executive is a participant, then the terms of this Agreement
shall govern and control.
38
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.
DONNKENNY, INC., a Delaware
corporation
By: /s/ Xxxxxx X. Xxxx
-------------------------------------------------
Name: Xxxxxx X. Xxxx
-------------------------------------
Title: Chairman and CEO
-------------------------------------
DONNKENNY APPAREL, INC., a
Delaware corporation
By: /s/ Xxxxxx X. Xxxx
-------------------------------------------------
Name: Xxxxxx X. Xxxx
-------------------------------------
Title: Chairman and CEO
-------------------------------------
EXECUTIVE
/s/ Xxxxx X. Xxxx
-------------------------------------------------------------
XXXXX X. XXXX
39
