Exhibit 10.2
EMPLOYMENT AGREEMENT
BETWEEN
HAMPSHIRE GROUP, LIMITED
AND
XXXXX X. XXXXXX
THIS AGREEMENT is made and entered into as of the 3rd day of April, 2007 by
and between Hampshire Group, Limited, a Delaware corporation, with offices at
000 X. 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("Hampshire" or the
"Company"), and Xxxxx X. Xxxxxx, an individual residing at 00 Xxxxxxx Xxxxxx,
Xxxxxxx, Xxx Xxxxxx 00000 ("Golden").
WHEREAS, Hampshire desires to employ Golden and to assure itself of his
continued services on the terms set forth herein; and
WHEREAS, Golden desires to be so employed under the terms set forth herein.
NOW THEREFORE, in consideration of the premises, mutual covenants,
conditions and promises in this Agreement, the parties hereto agree as follows:
1. Employment. Subject to the terms and conditions contained herein, Golden
will serve as Vice President Administration, General Counsel and Secretary of
the Company. In such capacity, Golden shall have duties and responsibilities
typically associated with such title, and will report directly to the Chief
Executive Officer of the Company, or such other officer or employee as may be
designated by the Chief Executive Officer from time to time. During the term of
this Agreement, Golden shall devote substantially all of his business time,
skill and attention to the performance of his duties on behalf of the Company.
2. Term. The terms of this Agreement shall apply for the calendar year 2007
and for each year thereafter unless sooner terminated as herein provided.
3. Salary. As compensation for his services, Golden will be paid a base
salary of Two Hundred Seventy Five Thousand Dollars ($275,000) per annum,
payable in accordance with the Company's customary payroll practices less
appropriate withholdings and deductions required by law.
4. Annual Bonus. For calendar year 2007 and beyond, Golden will be eligible
to receive an Annual Bonus based upon a bonus program established from time to
time by the Compensation Committee of the Board of Directors. All payments made
pursuant to this Paragraph 4 shall be made in accordance with the Company's
customary payroll practices less appropriate withholdings and deductions
required by law.
5. Benefits. Golden shall be entitled to participate in Company insurance
plans, pension and other employee benefits provided to other senior executives
of the Company, in accordance with the terms and conditions contained therein.
6. Termination.
(A) The Company may terminate the employment relationship at any time
for any reason. If Golden's employment is terminated by the Company for any
reason other than for cause (other than by reason of Golden's "disability"
(within the meaning of the Company's long-term disability policy)), Golden shall
be paid (i) severance in an amount equal to six months of his then annual base
salary, payable in six equal monthly installments less appropriate withholdings
and deductions required by law and (ii) a pro rata portion of any annual bonus
he would otherwise have been entitled to receive under Paragraph 4 hereof, less
appropriate withholdings and deductions required by law; such pro rata amount
will be paid after year end in accordance with the Company's customary payroll
practices and will be calculated by multiplying the annual bonus he would
otherwise have been entitled to receive under Paragraph 4 hereof by a fraction,
the numerator of which is the number of completed full months in the current
fiscal year through the date of termination (by way of example, if Golden is
terminated on August 16, the numerator will be seven) and the denominator of
which is 12. Golden will not be entitled to and shall not receive any additional
compensation or benefits of any other type following the date of termination. If
the Company terminates the employment for cause, Golden will not be entitled to
and shall not receive any severance, bonus or benefits of any type following the
date of termination. Notwithstanding the payment provisions described above, to
the extent required to fall within the "short-term deferal" exception under
Section 409A of the Internal Revenue Code of 1986, as amended, all amounts
payable under this paragraph shall be paid on or prior to March 14 of the
calendar year immediately following the calendar year in which such termination
occurs.
For purposes of this Agreement, "cause" for termination shall exist
only if Golden (i) breaches his fiduciary duty of loyalty owed to the Company,
(ii) is convicted of, or pleads guilty or `no contest" to, a felony, (iii)
commits willful misconduct involving acts of moral turpitude or that otherwise
result in, or could reasonably be expected to result in, material injury to the
Company or its subsidiaries, (iv) materially breaches this Agreement, (v)
materially fails to follow a written instruction of a superior or (vi) in
carrying out his duties and responsibilities, is guilty of gross neglect or
gross misconduct.
(B) Golden may terminate the employment relationship at any time for
any reason by giving written notice at least three (3) months prior to the
effective date of termination. In the event of termination of Golden's
employment under this Paragraph 6(B), he shall have the right to retain all
compensation and reimbursements for outstanding expenses incurred on behalf of
the Company through the effective date of termination but will not be entitled
to and shall not receive any severance, bonus or benefits of any type following
the date of termination. In addition, during such three (3) month notice period,
the Company may, in its sole and absolute
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discretion, prohibit Golden from entering the premises of the Company for all or
any portion of such notice period (which in no event shall be treated as a
termination by the Company without cause), provided that the Company shall
continue to pay to Golden his then base salary and continue benefits provided
pursuant to Paragraph 5 above for the duration of the notice period.
7. Covenants of Golden.
(A) At any time during and after Golden's employment hereunder,
without the prior written consent of the Company, except to the extent required
by an order of a court having jurisdiction or under subpoena from an appropriate
government agency, in which event, Golden shall use his best efforts to consult
with the Company prior to responding to any such order or subpoena, and except
as required in the performance of his duties hereunder, Golden shall not
disclose to or use for the benefit of any third party any Confidential
Information.
(B) At any time during and after Golden's employment hereunder and
during the one (1) year period immediately following any termination of such
employment for any reason, Golden shall not, directly or indirectly, for his own
account or for the account of any other individual or entity, engage in
Interfering Activities.
(C) For purposes of this Agreement:
(1) "Confidential Information" shall mean confidential or
proprietary trade secrets, client lists, client identities and information,
information regarding service providers, investment methodologies, marketing
data or plans, sales plans, management organization information, operating
policies or manuals, business plans or operations or techniques, financial
records or data, or other financial, commercial, business or technical
information (i) relating to the Company or any of its affiliates or
subsidiaries, or (ii) that the Company or any of its affiliates or subsidiaries
may receive belonging to suppliers, customers or others who do business with the
Company or any of its affiliates or subsidiaries, but shall exclude any
information that is in the public domain or hereafter enters the public domain,
in each case without the breach by Golden of this Paragraph 7.
(2) "Interfering Activities" shall mean (i) encouraging,
soliciting, or inducing, or in any manner attempting to encourage, solicit, or
induce, any individual employed by the Company or any of its affiliates or
subsidiaries to terminate such individual's employment with the Company or any
of its affiliates or subsidiaries, or (ii) encouraging, soliciting or inducing,
or in any manner attempting to encourage, solicit or induce any client, account,
customer, licensee or other business relation of the Company or any of its
affiliates or subsidiaries to cease doing business with or reduce the amount of
business conducted with the Company or any of its affiliates or subsidiaries, or
in any way interfere with the relationship between any such client, account,
customer, licensee or business relation and the Company or any of its affiliates
or subsidiaries.
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(D) Golden acknowledges and recognizes the highly competitive nature
of the Company's business, that access to Confidential Information renders him
special and unique within the Company's industry, and that he will have the
opportunity to develop substantial relationships with existing and prospective
clients, accounts, customers, consultants and contractors, investors and
strategic partners of the Company during the course of and as a result of his
employment with the Company. In light of the foregoing, Golden acknowledges and
agrees that the restrictions and limitations set forth in this Paragraph 7 are
reasonable and valid in geographical and temporal scope and in all other
respects, and are essential to protect the value of the business and assets of
the Company and its affiliates and subsidiaries.
(E) Golden expressly acknowledges that any breach or threatened breach
of any of the terms and/or conditions set forth in this Paragraph 7 may result
in substantial, continuing and irreparable injury to the Company. Therefore,
Golden hereby agrees that, in addition to any other remedy that may be available
to the Company, the Company shall be entitled to injunctive relief, specific
performance or other equitable relief by a court of appropriate jurisdiction in
the event of any breach or threatened breach of the terms of this Paragraph 7
without the necessity of proving irreparable harm or injury as a result of such
breach or threatened breach.
8. Change in Control.
(A) Upon any Change in Control during the term hereof, upon such
Change in Control, the Company (or its successor) shall pay Golden the Change in
Control Retention Payment, such amount to be payable in cash on or as soon as
administratively feasible following the consummation of such Change in Control.
To the extent that Golden's employment with the Company continues following a
Change in Control, notwithstanding any provision of this Agreement or any other
agreement between the Company (or its affiliates) and Golden to the contrary,
Golden shall be an "at-will" employee, and upon any subsequent termination of
employment, absent any further agreement between the parties to the contrary,
Golden shall not be entitled to any severance or other similar termination
payments or benefits, whether pursuant to Section 6 of this Agreement, or by any
other plan, agreement or otherwise.
(B) Notwithstanding any provision herein to the contrary, the Change
in Control Retention Payment shall be delayed for such period of time, if any,
as may be necessary to satisfy Section 409A(a)(2)(B)(i) of the Internal Revenue
Code of 1986, as amended from time to time (the "Code"). On the earliest date on
which the Change in Control Retention Payment can be made without violating the
requirements of Section 409A(a)(2)(B)(i) of the Code, there shall be paid to
Golden, in a single cash lump sum, an amount equal to the Change in Control
Retention Payment.
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(C) Definitions.
(1) "Change in Control" shall mean
(i) any Change in Control (as defined in the Company's 1992
Stock Option Plan (as amended and restated February 8, 2000)); or
(ii) the appointment as an executive officer of the Company,
following the date hereof, of any shareholder who beneficially owns, as of the
date hereof, directly or indirectly, in excess of five percent (5%) of the
Company's outstanding voting securities.
(2) "Change in Control Retention Payment" shall mean a lump-sum
amount equal to two times the sum of (i) Golden's annual base salary as in
effect immediately prior to the Change in Control, plus (ii) Golden's total
bonus amount paid or payable for services performed entirely within the year
prior to the year in which the Change in Control occurs (for example, if a
Change in Control occurs in 2007, the total bonus included in the Change in
Control Retention Payment calculation will be the bonus paid or payable for
services performed entirely within the Company's 2006 fiscal year, but excludes
any bonuses paid for services performed in the Company's 2005 fiscal year but
paid during the Company's 2006 fiscal year).
9. Continuing Education and Professional Dues. The Company shall pay all
fees and expenses incurred in keeping Golden's bar admissions current (including
continuing education and licensing fees), as well as the dues for one state and
one national legal organization.
10. Independence; Severability. Each of the rights enumerated in this
Agreement shall be independent of the others and shall be in addition to and not
in lieu of any other rights and remedies available to the Company at law or in
equity. If any of the provisions of this Agreement or any part of any of them is
hereafter construed or adjudicated to be invalid or unenforceable, the same
shall not affect the remainder of this Agreement, which shall be given full
effect without regard to the invalid portions. If any of the covenants contained
herein are held to be invalid or unenforceable because of the duration of such
provisions or the area or scope covered thereby, the parties hereto agree that
the court making such determination shall have the power to reduce the duration,
scope and/or area of such provision to the maximum and/or broadest duration,
scope and/or area permissible by law and in its reduced form said provision
shall then be enforceable.
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11. Entire Agreement. This Agreement contains the entire understanding of
the Company and Golden with respect to compensation of Golden and supersedes any
and all prior understandings, written or oral. For the avoidance of doubt, this
Agreement does not amend, modify, waive, supersede, or otherwise affect the
Indemnification Agreement by and between Golden and the Company dated September
11, 2006. This Agreement may not be amended, waived, discharged or terminated
orally, but only by an instrument in writing signed by both parties.
12. Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without giving effect to the
conflict of law principles thereof.
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IN WITNESS WHEREOF, the parties hereto have set their respective hands and
seals as of the day and year first above written.
HAMPSHIRE GROUP, LIMITED
By: /s/ Xxxxxxx Xxxxxx
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Name: Xxxxxxx Xxxxxx
Title: Acting Chief Executive Officer
/s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
