Exhibit 10.2
[COMPANY LETTERHEAD]
EMPLOYMENT AGREEMENT
Xx. Xxxxxxx X. Xxxxxx
0 Xxxxxxx Xxxxx
Xxxxxxxx, Xxx Xxxx 00000
Dear Xxxxxxx:
When countersigned by you and delivered to us, this letter confirms our
agreement to be employed by BIB Ltd./Sassoon Group, Inc. (the "Company") on he
terms set forth in this letter:
1. You shall be employed as a full-time employee of Company effective as
of the commencement of the initial term referred to in paragraph 2. At the time
the Company shall close aggregate financing including an equity line of credit
in the amount of not less than $2.6 million (before fees and expenses), you
shall then assume the position of Executive Vice President and Chief Financial
Officer of the Company and shall become a director' of the Company. You shall at
all times report to the Chairman, Xxxx Xxxxxx and/or the CEO, Xxxx Xxxxxx. Your
office shall be at the Company's New York City offices, and at your home office.
2. The initial term of your employment shall commence on January 1, 2004,
for a period of three years thereafter, unless terminated sooner in accordance
with the terms oft : is Letter Agreement. The term of your employment shall
automatically be renewed and extended, for successive one-year extension terms,
unless you or the Company gives written notice to the other of intention to
terminate not later than 1 years prior to the expiration of the initial or
then-current extension term. Notwithstanding the foregoing, you shall be
entitled, at your election, to terminate your employment within 10 business days
following a Change of Control; and in such event you shall be entitled to the
severance benefits referred in paragraph 10 below applicable to termination
following a Change of Control.
3. As compensation for your employment and services, you shall be paid a
signing bonus of $30,000 on January 2, 2004 and a base salary at an annual rate
of $120,000 per year. In the event the Company closes aggregate financing
including an equity line of credit of not less than $2.5 Million (before fees
and expenses) then for the period from January 1 through June 30, 2004, you
shall be paid a base salary at an annual rate of not less than $200,000 per
year. In either case, such base salary shall be paid to you in accordance with
the standard payroll (including withholding) practices of the Company for
executives, as they exist from time to time, but in any event in not less than
monthly installments. Starting July 1, 2004, your base salary shall be paid at
the rate of not less than $250,000 per year, provided such aggregate financing
is reached. Starting July 1, 2005, and annually thereafter for so long as you
remain employed by the Company, your salary shall increase at a rate of at least
5% per year. Severance amounts payable under this Letter Agreement shall be paid
at the last base salary level on the effective date of the termination.
4. You and the Company shall agree on terms and targets for a bonus plan
for senior executives for each calendar year, designed to provide you with a
minimum guaranteed bonus of $50,000 for calendar year 2004, payable in January
2005. Regardless of any bonus plan calculation, you shall receive a minimum
bonus of $50,000 for calendar year 2004 payable January 15, 2005. In the event
of failure to agree to such bonus plan, a minimum bonus payable as set forth in
this paragraph shall be due to you in January 2005 on account of your work in
2004. In the event your employment shall terminate prior to December 31, 2004,
you shs11l be paid, within 30 days of termination, a bonus, based on the minimum
guarantee stated in this paragraph, which shall be pro rated for.the portion of
the year in issue prior to the effective date of your termination.
5. You shall receive such benefits, and right to participate in benefit
programs, as the Company maintains for its regular full-time employees and its
executives. Your reasonable and necessary travel and other expenses incurred in
connection with the performance of your responsibilities in accordance with
Company guidelines shall be reimbursed to you by the Company, subject to
presentation of appropriate documentation and receipts in accordance with then
applicable Company policy.
6. You shall be entitled to an annual vacation of three weeks for 2004 and
four weeks annual vacation for 2005 and each year thereafter.
7. As an inducement to your execution of this Letter Agreement, and in
compensation, in part, for services you are to provide hereunder, you shall
receive if and when during the Term the Company shall close on aggregate
financing including an equity line of credit of not less than $2.5 million
(before fees and expenses), options to acquire shares of the common stock of the
Company. Such options shall be at the closing market price on the day prior to
the date on which such aggregate financing closes, and shall be for two million
five hundred thousand shares, in the aggregate. Such options shall vest as
follows: 100,000 shares vested upon issuance of such options; 100,000 shares to
vest on the last business day of each month starting with the month such
aggregate financing is dosed, and concluding with the last business day of the
24th month following such closing. In the event your employment is terminated
prior to full vesting, for any reason other than Cause, all options shall vest
upon such termination. The options shall be exercisable for a period of seven
and one-half years from the date of grant. The company shall use its best
efforts to obtain registration for all stock that is the subject of these
options, within 90 days of the date upon which your right to acquire such stock
vests.. If such stock is not registered within 90 days of the vesting date, the
Company agrees to redeem all or any portion of such stock, at your election, at
the closing market price on the day you request such redemption.
8. In addition to stock options, if and when during the term the Company
shall close on aggregate financing of not less than $2.6 million (before fees
and expenses), you shall receive a grant of 500,000 shares of the Company's
common stock. The Company shall use its best efforts to obtain registration for
such stock within 120 days of issuance. If such stock is not registered within
120 days of the grant date, the Company agrees to redeem all or any portion of
such stock, at your election, at the closing market price on the day you request
such redemption.
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9. In the event the Company terminates your employment without "Cause", or
you terminate your employment for Good Reason, you shall be entitled to receive
a severance payment in the amount of salary for the remainder of the
then-current term of this Letter Agreement, or one year's salary (whichever is
the greater) and to continue to receive for such period all benefits available
to you as of the time of termination of your employment. In the event that your
employment is terminated by the Company or you following a Change of Control,
you shall be entitled to a severance benefits referred to in the immediately
preceding sentence, except that such severance period shall be increased to two
years. Such severance amounts shall be payable, at your option, in a lump sum or
on the periodic basis in effect at the time of such termination. You shall
receive such lump sum payment within 15 business days of providing written
notice to elect such payment method to the Company, following termination of
your employment. If severance is payable under this paragraph prior to the
payment of your 2004 guaranteed bonus, you shall also receive a payment equal to
the minimum amount of such bonus. In the event of any termination entitling you
to severance payments under this section, all stock options previously issued
shall continue to vest according to the vesting schedule in paragraph 7, and you
shall be entitled to the exercise period provided for in the grant of the
option. You shall have no obligation to mitigate damages during any severance
period or in the event of any breach by the Company of this Letter Agreement,
and your entitlement to receive severance or other payments shall not be
affected or impaired by whether you are employed in any period after the
termination of this Letter Agreement.
10. (a) "Cause" for termination of your employment by the Company shall
mean (1) willful and continuing refusal by you, after written notice, to follow
lawful directives of the Chief Executive Officer or of the Board of Directors of
the Company; or (2) conviction of a felony; or (3) a financial impropriety in
which the Company is successful in prosecuting such claim in court.
(b) "Good Reason" means a breach by the Company of its obligations
under this Letter Agreement, including but not limited to any material change in
your duties or responsibilities or compensation, a relocation of your office to
more than 75 miles from your residence, in Blauvelt, New York, or a failure to
secure the agreement of any successor company to assume all obligations of this
Agreement.
(c) "Change of Control" means any one of the following: (1) any
transaction or series of transactions pursuant to which Xxxx Xxxxxx, Xxxx
Xxxxxx, and their children, collectively, are no longer the largest shareholders
of the Company or no longer beneficially own, directly or indirectly more than
35% of the Company's outstanding voting securities entitled to vote on a regular
basis for a majority of the members of the Board of Directors; (2) a change in
the composition of the Board of Directors of the Company such that, during any
24 month period, persons who were directors at the beginning of such period
cease, for any reason, to continue to constitute a majority of the Board; (3)
any merger or other business combination (in one or more transactions) of the
Company, unless the Company is the entity surviving and the shareholders of the
Company prior to the transaction(s) own and control not less than 60% of the
voting power, directly or indirectly, of the surviving entity; (4) the
consummation of any plan of liquidation of the Company, or the filing by or
against the Company of a petition in Bankruptcy (which is not dismissed within
30 days).
11. If you become Permanently Disabled during the initial term, or any
extension of this Letter Agreement, (a) all outstanding stock options shall
continue to vest according to the vesting schedule in paragraph 7 and shall be
exercisable during the period provided for in the grant of the stock option; and
(b) the Company will pay to you an amount equal to the salary you would have
earned during the then-current term of this Letter Agreement for a six month
period. "Permanently Disabled" means unable, for a period of 90 consecutive
days, or more, to perform the duties of your position on account of mental or
physical injury or illness.
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12. The Company agrees that it will indemnify you and hold you harmless
for any and all claims made by third persons with respect to any acts taken or
omitted by you in the course of or in connection with the performance of your
employment hereunder to the fullest and greatest extent permitted by applicable
law, and shall purchase, acquire and maintain policies of insurance for Errors
and Omissions and Directors' and Officers Liability in the aggregate amount of
$5 million.
13. This Letter Agreement (together with any grant of stock or stock
options issued in pursuant hereto) constitutes the entire agreement of the
parties concerning the terms and conditions of your employment. This Letter
Agreement may be amended only by a writing signed by you and by a duly
authorizedd representative of the Company. No modification or amendment of this
Letter Agreement shall be effective for any purposes unless set forth in a
writing signed by the parties hereto. No failure or delay in exercising any
rights under this Letter Agreement shall constitute a waiver or relinquishment
of any rights under this Letter Agreement, except as set forth in a writing
signed by the party against whom such waiver is sought to be enforced. No waiver
of any right under this Letter Agreement at any point in time or for any period
shall effect any waiver or relinquishment of rights as to any future period or
with respect to any future event.
14. The Company represents and warrants to you that: (a) the entry into
and performance of this Letter Agreement is not prohibited or impaired by any
law, rule, regulation, court order or decree, contract or agreement to which the
Company is a party or by which it is bound; (b) all formalities required to make
this Letter Agreement a binding obligation of the Company have been undertaken;
and (c) the person executing this Letter Agreement on behalf of the Company is
duly authorized to do so.
15. This Letter Agreement is entered into by and between you and the
Company effective as of the date first written above and shall be deemed, for
any and all purposes to have been entered into and to be performed wholly within
the State of New York. In the event of any dispute concerning performance or
breach of the obligations stated in this Letter Agreement, you and the Company
agree that any lawsuit, action or claim with respect thereto shall be filed only
in the State or Federal courts located in City, County and, State of New York.
You and the Company waive any and all objections to the jurisdiction or venue of
any such courts. In the event a lawsuit or other legal proceeding is brought to
enforce the terms of this Letter Agreement, you shall be entitled to be
reimbursed for any and all reasonable legal expenses incurred by you in
connection therewith.
16. Notices for BIB Ltd./Sassoon should be sent to Xxxx Xxxxxx at Sassoon
Group, 0 Xxxx 00xx Xxxxxx, xxxx Xxxxx, Xxx Xxxx, XX 00000 with copies to Xxxxx
Xxxxxxxx at Xxxxxxx Xxxxxxx & Xxxxxxxxxx, Paragon Centre-Suite 300, 0000 Xxxx
xxxx, Xxxxxxxxx, XX 00000. Notices for Xxxxxx should be sent to him at 0 Xxxxxxx
Xxxxx, Xxxxxxxx, XX 00000.
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Very truly yours,
/s/ Xxxx Xxxxxx
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Xxxx Xxxxxx
Chairman
Agreed to this 29th day of October, 2003:
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
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