EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT is made this 15th day of May 1997,
by and between I. C. ▇▇▇▇▇▇ & Company, L.P., a Delaware limited partnership
(the "Company"), and ▇▇▇▇▇▇ ▇. ▇▇▇▇ (the "Executive").
EXPLANATORY STATEMENT
The Company desires to continue to employ the Executive as the President
and Co-Chief Executive Officer on the terms and conditions herein set forth,
and the Executive has agreed to accept employment with the Company on the
terms and conditions herein set forth.
NOW, THEREFORE, in consideration of the premises and the mutual promises
made herein, the parties agree as follows:
1. Employment. The Company hereby employs the Executive as its
President and Co-Chief Executive Officer and agrees to continue the Executive
in that position during the term of this Agreement.
2. Term. This Agreement shall begin May 15, 1997 and shall continue
until May 15, 2000. (the "Employment Period") Thereafter, this Agreement
shall renew automatically from Employment Year to Employment Year, subject to
the right of either party to terminate this Agreement as of the end of any
Employment Year upon sixty (60) days' prior written notice to the other
party. An "Employment Year" begins each May 15 and ends on the following May
15.
3. Base Salary. The Executive's base salary for the first Employment
Year under this Agreement (May 15, 1997 through May 15, 2000) shall be at the
rate of Four Hundred Thousand Dollars ($400,000) per annum. Such base salary
may be increased based on periodic reviews by the Compensation Committee of
the Board of Directors. The Executive's base salary shall be paid throughout
the year, in accordance with normal payroll practices of the Company.
4. Bonuses; Stock Plans. In addition to his base salary, during the
term of this Agreement, the Executive shall be entitled to participate in any
bonus and stock option plans, programs, arrangements and practices sponsored
by the Company for the benefit of executive employees serving in similar
capacities with the Company (and/or its affiliates), if any, as may be
established from time to time by the Board of Directors of the Company for
the benefit of such executive employees, in accordance with the terms of such
plans, as amended by the Company from time to time; it being understood that
there is no assurance with respect to the establishment of such plans or, if
established, the continuation of such plans during the term of this Agreement.
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5. Other Benefits. During the term of this Agreement, the Executive
shall also be entitled to participate in or receive benefits under all of the
Company's benefit plans, programs, arrangements and practices, including
pension, disability, and group life, sickness, accident or health insurance
programs, if any, as may be established from time to time by the Board of
Directors of the Company for the benefit of executive employees serving in
similar capacities with the Company (and/or its affiliates), in accordance
with the terms of such plans, as amended by the Company from time to time; it
being understood that there is no assurance with respect to the establishment
of such plans or, if established, the continuation of such plans during the
term of this Agreement.
6. Duties.
A. During the term of this Agreement, the Executive shall serve as
the President and Co-Chief Executive Officer, have such powers and shall
perform such duties as are incident and customary to his office, including
those described in the Company's By-Laws (as amended from time to time), and
shall perform such other additional executive and administrative duties and
functions commensurate with such position as from time to time shall be
assigned to him by the Board of Directors of the Company. The Executive
shall perform such additional duties and functions without separate
compensation, unless otherwise authorized by the Board.
B. The Executive shall devote his full time, attention, skill, and
energy to the performance of his duties under this Agreement, and shall
comply with all reasonable professional requests of the Company; provided,
however, that the Executive will be permitted to engage in and manage
personal investments and to participate in community and charitable affairs,
so long as such activities do not interfere with his duties under this
Agreement.
7. Vacation and Sick Leave.
A. The Executive shall be entitled to a total of four (4) weeks of
vacation each Employment Year, such vacation to be in accordance with the
terms of the Company's announced policy for executive employees, as in effect
from time to time. The Executive may take his vacation at such time or times
as shall not interfere with the performance of his duties under this
Agreement.
B. The Executive shall be entitled to paid sick leave and holidays
in accordance with the Company's announced policy for executive employees, as
in effect from time to time.
8. Expenses. The Company shall reimburse the Executive for all
reasonable expenses, including but not limited to expenses for first class
service for international air travel, incurred in connection with his duties
on behalf of the Company, provided that the Executive shall keep, and present
to the Company, records and receipts relating to reimbursable expenses
incurred by him. Such records and receipts shall be maintained and presented
in a format, and with such regularity, as the Company reasonably may require
in order to substantiate the
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Company's right to claim income tax deductions for such expenses. Without
limiting the generality of the foregoing, the Executive shall be entitled to
reimbursement for any business-related travel, business-related
entertainment, whether at his residence or otherwise, and other costs and
expenses reasonably incident to the performance of his duties on behalf of
the Company.
9. Termination of Employment for Cause. Notwithstanding the
provisions of Section 2 of this Agreement, the Executive's employment (and
all of his rights and benefits under this Agreement) shall terminate
immediately and without further notice upon the happening of any one or more
of the following events:
A. The Executive has been or is guilty of (i) a criminal offense
involving moral turpitude, (ii) criminal or dishonest conduct pertaining to
the business or affairs of the Company (including, without limitation, fraud
and misappropriation), (iii) any act or omission the intended or likely
consequence of which is material injury to the Company's business, property
or reputation, which act or omission continues uncured for a period of ten
(10) days after the Executive has received written notice from the Company,
and/or (iv) gross negligence or willful misconduct which continues uncured
for a period of ten (10) days after the Executive has received written notice
from the Company;
B. The Executive persists, for a period of ten (10) days after
written notice from the Company, in a course of conduct reasonably determined
by the Board of Directors of the Company to be in violation of his duties to
the Company under this Agreement or otherwise in violation of the covenants,
agreements or obligations under the terms of this Agreement;
C. The Executive's death; or
D. The continuous and uninterrupted inability to perform the
Executive's duties on behalf of the Company, by reason of accident, mental or
physical illness or impairment, or disease, for a period of one hundred and
eighty (180) days from the first day of such inability to perform his duties.
(Subsections A, B, C, & D of this Section 9 hereinafter referred to
collectively and individually as "Cause").
In the event of a termination for Cause, the Company shall pay the
Executive his base salary through the effective date of the employment
termination, and the Executive shall immediately thereafter forfeit all
rights and benefits (other than vested benefits), including but not limited
to any right to compensation pursuant to Section 4 of this Agreement, he
would otherwise have been entitled to receive under this Agreement. The
Company and the Executive thereafter shall have no further obligations under
this Agreement except as otherwise provided in Sections 13 and 14 of this
Agreement.
10. Termination of Employment by the Company Without Cause.
Notwithstanding the provisions of Section 2 of this Agreement, the Board of
Directors may terminate the Executive's employment, as provided under this
Agreement, at any time, for reasons other than
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for Cause by notifying the Executive in writing of such termination. If the
Executive is terminated pursuant to this Section 10, (i) during the remainder
of the Non-Competition Period (as hereinafter defined), the Company shall
pay the Executive his base salary at the rate and in the manner required by
Section 3 and in effect immediately prior to the date of termination and (ii)
after the Employment Period, the Company and the Executive shall have no
further obligations under this Agreement except as otherwise provided in
Sections 13 and 14 of this Agreement.
11. Termination of Employment by the Executive. Notwithstanding the
provisions of Section 2 of this Agreement, the Executive may terminate this
Agreement at any time by giving the Board of Directors written notice of his
intent to terminate, delivered at least sixty (60) days prior to the
effective date of such termination.
Upon expiration of the sixty (60) day notice period (or such earlier
date as may be approved by the Board of Directors), the termination by the
Executive shall become effective. Upon the effective date of such
termination, the Company's obligations under Sections 3, 4 and 5 of this
Agreement shall immediately expire, except to the extent that the benefits
described in Section 5 have vested and continue after termination under the
terms of the benefit plans and programs that generally apply to executive
employees serving in similar capacities with the Company.
12. Non-Renewal. If, upon termination of the Employment Period, the
Company shall decide not to renew this Agreement and the Company does not
waive the provisions of Section 13 below, (i) during the remainder of the
Non-Competition Period, the Company shall pay the Executive his base salary
at the rate and in the manner required by Section 3 of this Agreement and in
effect immediately prior to the date of termination and (ii) after the
Employment Period, the Company and the Executive shall have no further
obligations under this Agreement except as otherwise provided in Sections 13
and 14 of this Agreement.
13. Non-Competition. The Executive and the Company recognize that due
to the nature of his employment, and his relationship with the Company, the
Executive has had and will have access to, and has acquired and will acquire,
and has assisted and will assist in developing, confidential and proprietary
information relating to the business and operations of the Company (for
purposes of this Section 13 and Section 14 below, the Company shall mean the
Company, I. G. Design, Inc., or any of its/their affiliates or successors)
including, without limitation, information with respect to their present and
prospective services, systems, products, clients, customers, agents, and
sales and marketing methods. The Executive acknowledges that such
information has been and will be of central importance to the Company's
business and that disclosure of it to others or its use by others could cause
substantial loss to the Company. The Executive and the Company also
recognize that an important part of the Executive's duties will be to develop
good will for the Company through his personal contact with the Company's
clients, and that there is a danger that this good will, a proprietary asset
of the Company, may follow the Executive if and when his relationship with
the Company is terminated.
A. The Executive agrees that, during the term of his employment
with the Company, and for a period of two (2) years after the termination of
his employment for any reason whatsoever, including the non-renewal of this
Agreement by either party (the "Non-Competition Period"):
(i) The Executive will not directly or indirectly, within
the United States, whether as a partner, proprietor, employee,
consultant, agent or otherwise, participate or engage in any business
that competes with, restricts, or interferes with the business of the
Company, including, without limitation, any business in the young
men's and women's contemporary sportswear industry.
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(ii) The Executive will not directly or indirectly (for
his own account, or for the account of others) interfere with,
solicit, or accept for himself, his benefit, or for anyone other
than the Company, any of the clients or customers of the Company,
at the time of said termination, or any potential clients or
customers solicited or being solicited by the Company at the time
of such termination or within the period two (2) years prior thereto,
or perform any services of any competitive nature in connection with
said clients or customers for anyone other than the Company.
(iii) The Executive further agrees that he shall not, at
any time, directly or indirectly, urge any client (or customer) or
potential client (or potential customer) of the Company to discontinue
business, in whole or in part, or not to do business, with the Company.
(iv) The Executive further agrees that he shall not, at
any time, directly or indirectly, solicit, hire or arrange to hire
any person who at the time of such hire or within two (2) years prior
to the time of such hire was an employee of the Company and was not
involuntarily terminated by the Company, for himself or for any
business entity with which he may be, or may be planning to be,
affiliated or associated, or otherwise interfere with the retention
of employees that the Company desires to retain as such.
B. The Executive expressly acknowledges and agrees (i) that the
restrictions set forth herein are reasonable, in terms of scope, duration,
geographic area, and otherwise, (ii) that the protections afforded to the
Company hereunder are necessary to protect its legitimate business interests,
and (iii) that the agreement to observe such restrictions form a material
part of the consideration for this Agreement and the Executive's employment
by the Company.
14. Confidential Information. The Executive agrees that, during the
term of his employment with the Company, and for a period of two (2) years
after the termination of his employment for any reason whatsoever, he shall
not disclose to any person or use the same in any way, other than in the
discharge of his duties under this Agreement in connection with the business
of the Company, any trade secrets or confidential or proprietary information
of the Company, including, without limitation, any information or knowledge
relating to (i) the business, operations or internal structure of the
Company, (ii) the clients (or customers) or potential clients (or potential
customers) of the Company, (iii) any method and/or procedure (such as
records, programs, systems, correspondence, or other documents), relating or
pertaining to projects developed by the Company or contemplated to be
developed by the Company, or (iv) the Company's business, which information
or knowledge the Executive shall have obtained during the term of this
Agreement, and which is otherwise of a secret or confidential nature.
Further, upon leaving the employ of the Company for any reason whatsoever,
the Executive shall
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not take with him, without prior written consent of the Board of Directors of
the Company, any documents, forms, or other reproductions of any data or any
information relating to or pertaining to the Company, any clients (or
customers) or potential clients (or potential customers) of the Company, or
any other confidential information or trade secrets.
15. Entire Agreement; Amendments, Other Agreements. This Agreement
contains the entire understanding of the Executive and the Company with
respect to employment of the Executive and supersedes any and all prior
understandings, written or oral. This Agreement may not be amended, waived,
discharged or terminated orally, but only by an instrument in writing. Any
earlier employment agreements between the Executive and the Company are
hereby terminated and shall be of no further effect after the effective date
hereof.
16. Miscellaneous.
A. Any notices required by this Agreement shall (i) be made in
writing and mailed by certified mail, return receipt requested, with adequate
postage prepaid; (ii) be deemed given when so mailed; (iii) be deemed
received by the addressee within ten (10) days after given or when the
certified mail receipt for such mail is executed, whichever if earlier; and
(iv) in the case of the Company, be mailed to its principal office, or in the
case of the Executive, be mailed to the last address that the Executive has
given to the Company.
B. This Agreement shall be binding upon and inure to the benefit
of, the parties, their successors, assigns, personal representatives,
distributees, heirs, and legatees.
C. This Agreement shall be governed by, and construed and enforced
in accordance with, the laws of the State of Maryland, without giving effect
to the principles of conflicts of law thereof.
D. Any dispute regarding any aspect of this Agreement or any act
which allegedly has or would violate any provision of this Agreement will be
submitted to binding arbitration. Such arbitration shall be conducted before
an arbitrator sitting in a location agreed to by the Company and the
Executive within fifty (50) miles of the location of the Executive's
principal place of employment, in accordance with the rules of the American
Arbitration Association then in effect. Each party will be entitled to
limited discovery, to consist of a maximum of three (3) depositions (maximum
two (2) hours each), and twenty-five (25) written interrogatories per party,
which will be completed within one hundred twenty (120) days following the
selection of the arbitrator. Judgment may be entered on the award of the
arbitrator in any court having competent jurisdiction.
E. Any failure by the Company to insist upon strict compliance with
any term or provision of this Agreement, to exercise any option, to enforce
any right, or to seek any remedy upon any breach by the Executive shall not
affect, or constitute a waiver of, the Company's right to insist upon such
strict compliance, exercise such option, enforce such right, or seek such
remedy with respect to such breach or any prior, contemporaneous, or
subsequent breach. No custom or practice of the Company at variance with any
provision of this Agreement shall affect
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or constitute a waiver of, the Company's right to demand strict compliance
with all provisions of this Agreement.
F. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be deemed
severable from the remainder of this Agreement, and the remaining provisions
contained in this Agreement shall be construed to preserve to the maximum
permissible extent the intent and purposes of this Agreement. Any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
G. In the event that the Executive violates the provisions of
Sections 13 and 14 above, upon notice from the Company informing him of the
nature of such violation, the Executive shall immediately terminate any
actions which constitute such violation. The existence of this right shall
not preclude any other rights and remedies at law or in equity which the
Company may have.
H. It is recognized that damages in the event of breach of any
provision of Sections 13 and 14 above by the Executive would be difficult, if
not impossible, to ascertain, and it is therefore agreed that the Company, in
addition to and without limiting any other remedy or right it may have, will
be entitled to a decree of specific performance, mandamus or other
appropriate remedy to enforce performance of such requirements.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first hereinabove written.
I. C. ▇▇▇▇▇▇ & COMPANY, L.P.
I. G. DESIGN, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Co-Chief Executive Officer
EXECUTIVE
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇
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