EMERGING VISION, INC. Employment Agreement with Glenn Spina
EMERGING
VISION, INC.
_____________________________
Employment
Agreement with
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This
Agreement entered into by and between EMERGING VISION, INC. (the
“Company”) and
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at ▇▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, effective as of December 1, 2009 (the “Effective
Date”).
WHEREAS, the parties desire by
this writing to set forth the employment relationship of the Company and the
Employee.
NOW, THEREFORE, it is AGREED as
follows:
1. Employment. The
Employee is employed in the position of Chief Executive Officer/President of the
Company. The Employee shall perform such duties and render such services for the
Company as are customarily performed by persons situated in a similar
capacity. Employee’s services shall be full time and exclusive,
subject to the exceptions provided herein. Except for passive
investments in non-optical related businesses and/or ventures, services in
connection with any civic, professional, educational or charitable organization
or trade association, or as otherwise permitted hereunder, Employee shall devote
all of Employee’s business time, attention and best efforts, skill and ability
to promote the interests of the Company and perform the services under this
Agreement. Employee shall report to the Board of Directors of the
Company (the “Board”). During
the Term, Employee shall be a member of the Board, provided however
that Employee shall be deemed to have resigned from the Board upon termination
of this Agreement. The Employee’s duties shall be such as the Board
from time to time directs, but shall be consistent with industry standards for
presidents of companies in the consumer products/optical franchising
business.
2. Base
Compensation. The Company agrees to pay the Employee during
the Term of this Agreement a salary (the “Base Compensation”)
at the rate of $250,000.00 per annum, payable in cash in accordance with the
Company’s normal payroll practices but in no event less frequently than twice
per month.
3. Bonus
Compensation.
(a)
During the Term, provided the Employee’s employment has not been terminated for
Just Cause or resignation by Employee, in addition to the Base Compensation
payable to the Employee pursuant to Section 2 hereof, the Employee, subject to
the terms and conditions hereof, shall also be entitled to receive from the
Company a bonus (the “Performance Bonus”)
for each calendar year or portion thereof included within the Term, equal to
five percent (5.0%) of the amount of the Company’s EBITDA (as hereinafter
defined) that exceeds $2,000,000 (the “Threshold
Amount”). No Performance Bonus shall be payable under this
Subsection 3(a) with respect to any such calendar year or portion thereof in
which the Company’s EBITDA is less than the Threshold Amount. The
Threshold Amount shall be pro-rated (reduced) for periods of less than a full
calendar year. If the Company's EBITDA with respect to any calendar
year (or the pro rata portion thereof, if less than a full calendar year) during
the Term is equal to or greater than the Threshold Amount (or the pro rata
portion thereof if for less than a calendar year [the “Pro Rata Threshold
Amount”]), the Performance Bonus shall be calculated from the first
dollar of EBITDA in excess of the Pro Rata Threshold Amount; it being understood
that, with respect to any calendar year not falling entirely within the Term,
the Pro Rata Threshold Amount shall be a pro rata portion of the Threshold
Amount based on: (x) the number of full quarterly periods (ending March 31, June
30, September 30 and December 31) actually falling within the Term; plus (y) the
immediately succeeding quarterly period (e.g., the quarterly period during which
the Term shall expire or terminate).
(b) For
purposes hereof, the term “EBITDA” shall mean the Company’s consolidated
earnings from continuing operations, before all interest, taxes, depreciation,
amortization, non-cash equity compensation charges and non-cash impairment and
similar charges for the year in question (or, if less than a full calendar year,
the number of full quarterly periods included within the applicable period)
determined in accordance with generally accepted accounting principles
consistently applied, as reported upon, with respect to full years, or reviewed,
with respect to less than full year periods, as the case may be, by the
independent certified public accountants of the Company, except that the net
profit or loss of any entity, substantially all of the assets or equity
interests of which are hereafter acquired by the Company or any subsidiary, in
any manner, accrued or realized by any such entity prior to the date of each
such acquisition by the Company or any of its subsidiaries, shall be
excluded.
(c) The
Performance Bonus shall be payable, in a lump sum, promptly following the
determination of the amount thereof, if any, but not later than the later of (x)
one hundred (100) days following December 31 of each year with respect to which
a Performance Bonus is payable and (y) twenty (20) days following completion of
the Company’s annual audit.
(d) With
respect to each calendar year for which a Performance Bonus may be payable
hereunder, the Company covenants and agrees that, in the event it shall change
its accounting year end, such year end shall, for purposes hereof, nevertheless
be deemed to be December 31.
(e) During
the Term, provided the Employee’s employment has not been terminated for Just
Cause or resignation by Employee, in addition to the Base Compensation payable
to the Employee pursuant to Section 2 hereof and the Performance Bonus payable
to the Employee pursuant to this Section 3, the Employee may also be entitled to
receive from the Company an additional cash bonus (the “Discretionary Bonus”)
for each calendar year or portion thereof included within the
Term. The Discretionary Bonus, if any, shall be determined by the
Board in its sole discretion.
4. Stock
Option. Employee acknowledges that the Board, at the next
annual meeting of shareholders of the Company, intends to seek approval (“Issuance Approval”)
of the authorization of not less than 50,000,000 additional shares of Class A
Common Stock of the Company (“Shares”), a portion
of which would be made available under the Company’s 2006 Stock Incentive Plan
(the “Plan”). In
the event the Company obtains Issuance Approval, and subject to the filing of an
amendment to the Company’s Certificate of Incorporation, as amended (the “Amendment”), in
addition to the amounts payable to the Employee in connection with performance
of services for the Company, the Company shall, as soon as reasonably
practicable following Issuance Approval and the filing of the Amendment, grant
to the Employee a non-qualified stock option (the “Stock Option”),
subject to the provisions of the Plan, evidencing the right to purchase
3,000,000 Shares at a price equal to the fair market value of the Shares as of
the date of grant of the Stock Option. If granted, the Stock Option
shall vest as follows: (i) January 1, 2011 - 1,000,000 Shares; (ii)
January 1, 2012 - 1,000,000 Shares; and (iii) January 1, 2013 - 1,000,000
Shares, and be subject to Employee being an employee of the Company as of the
applicable vesting date. The Stock Option shall also contain such
other terms and conditions as, subject to the Plan, the Board or Compensation
Committee of the Board, may determine.
5. Expenses.
(a) Participation in Retirement, Medical
and Other Plans. The Employee shall participate in any plan
that the Company maintains for the benefit of its executive employees if the
plan relates to (i) pension, profit-sharing, or other retirement benefits, (ii)
medical insurance or the reimbursement of medical or dependent care expenses, or
(iii) other group benefits, including disability and life insurance
plans.
(b) Expenses. The
Employee shall be reimbursed for all reasonable out-of-pocket business expense
which Employee shall incur in connection with services rendered under this
Agreement upon substantiation of such expenses in accordance with the policies
of the Company.
(c) Car
allowance. During the Term, the Company agrees to provide
Employee with an automobile allowance in an amount not to exceed $600.00 per
month.
(d) Relocation
allowance. The Company agrees to pay to Employee a relocation
allowance, upon substantiation of expenses, in an amount not to exceed
$20,000.00.
6. Term. The
Company hereby employs the Employee, and the Employee hereby accepts such
employment under this Agreement, for the period commencing on the Effective Date
and ending on December 31, 2012 (or such earlier date as is determined in
accordance with Section 10) (the “Term”).
7. Non-Competition and
Protection of Confidential Information
(a) It is
agreed that Employee will not at any time (whether during the Term or after
termination of this Agreement), disclose to anyone any confidential information
or trade secret of the Company or any subsidiaries of the Company or any company
controlled by it, including a company in which it may hold a direct or indirect
interest of at least twenty five percent (an “Affiliate”) or of any
clients, Company Customers (as hereinafter defined), franchisees or landlords
of, or related to, the Company or an Affiliate (each, a “Company
Relationship”), or utilize such confidential information or trade secret
for his own benefit, or for the benefit of third parties, except pursuant to a
lawful order of a court of competent jurisdiction or other legal
process. As used throughout this Agreement, the term “Company Customers”
shall mean (A) anyone who is then a client, or customer of the Company; (B)
anyone who was a client or customer of the Company at any time during the one
year period immediately preceding the date of termination of Employee’s
affiliation with the Company; and (C) any prospective clients, or customers to
whom the Company had made a presentation (or similar offering of services)
within a period of 90 days immediately preceding the date of such
termination. Employee shall maintain proper files and records
relating to work performed by Employee for the benefit of the
Company. All such files and records are the exclusive property of the
Company and shall be delivered to the Company upon the termination of Employee’s
relationship with the Company. Employee agrees to treat as material,
confidential and proprietary to the Company, the data or information used,
gained or created by Employee in the course and during the period of affiliation
with the Company and any Affiliate and that relates to the type of business
conducted by the Company and Affiliates. This data shall include, without
limitation, all customer financial information, telephone numbers, addresses of
and personal information about customers and other representatives, profit and
loss statements, productivity data, financial models, computer software
programs, source and other codes, information about direct communication lines,
electronic and voice systems, the Company’s business prospects and
opportunities, and all other information about or gained from any Company
Relationship during Employee’s affiliation with the Company.
(b) In
consideration of the compensation and benefits awarded to Employee, which
Employee hereby acknowledges would not have been offered at the level and rate
provided, Employee hereby assigns to the Company all of Employee’s intellectual
property and all other rights Employee may have possessed with regard to any
aspect of the Company and Affiliate’s business, proposals, works-in-progress,
and business opportunities, and with regard to any relationship with any Company
Customers, vendors who provide services to the Company, and independent
contractors who are performing services for the Company, including, with regard
to customer relationships, if any, those existing prior to Employee’s employment
with the Company under this Agreement.
(c) During
the term of this Agreement and for a period of two (2) years following
resignation by Employee or termination of Employee’s employment, Employee shall
not directly or indirectly employ, solicit the employment of, attempt to
affiliate for profit with, or otherwise encourage any employee or independent
contractor of the Company or any Affiliate to terminate employment or
affiliation with the Company or an Affiliate, as applicable, for the benefit of
Employee or any other party, or assist any enterprise to employ any person
employed by or affiliated with the Company or any Affiliate at any time during
the term of this Agreement and periods contemplated by this
paragraph.
(d) During
the term of this Agreement and for a period of two (2) years following
resignation by Employee or termination of Employee’s employment for Just Cause,
Employee shall not directly or indirectly, enter into a business relationship,
or assist any enterprise to enter into a business relationship, with a Company
Relationship, or solicit any Company Relationships, to do business with
Employee, or any other person or entity, in competition with
the Company, except on behalf of the Company or as authorized in
writing by the Company.
(e) During
the term of this Agreement and for a period of one (1) year following
resignation by Employee or termination of Employee’s employment, Employee shall
not directly or indirectly, enter the employ of or render any services to any
person, firm or corporation that is in a business in competition with the
Company, nor engage in such business on his own account as an individual,
partner, shareholder, director, officer, principal, agent, consultant, or in any
other relationship or capacity whatsoever (except by way of portfolio investment
in shares quoted on a recognized stock exchange).
(f) EMPLOYEE
ACKNOWLEDGES THE SPECIAL IMPORTANCE TO THE COMPANY OF THIS SECTION 7 AND THAT
EMPLOYEEE UNDERSTANDS THE PROHIBITIONS CONTAINED IN SECTION 7 OF THIS AGREEMENT
AND THAT EMPLOYEE HAS RECEIVED ADDED COMPENSATION THAT EMPLOYEE WOULD NOT
OTHERWISE BE ENTITLED TO RECEIVE, IN ORDER TO INSURE COMPLIANCE WITH SAID
PROVISIONS AND TO REMOVE OR OTHERWISE WAIVE ANY POSSIBILITY, CLAIM OR ASSERTION
THAT COMPLIANCE WILL IMPOSE ANY UNDUE HARDSHIP.
(g) If
Employee commits a breach or threatens to commit a breach, of any of the
provisions of this Agreement, the Company, shall have the right to have the
provisions of this Agreement specifically enforced by any court having
equity jurisdiction without being required to post bond or other security and
without having to prove the inadequacy of the available remedies at law, it
being acknowledged and agreed that any such breach or threatened breach will
cause irreparable injury to the Company and that money damages will not provide
an adequate remedy to the Company. In addition, if the Company so
elects, the Company shall be entitled, in addition to all other remedies
available, including but not limited to actual compensatory and punitive
damages, to obtain damages and reimbursement of its reasonable attorneys’ fees
and disbursements for any breach of this Agreement or to specifically enforce
the performance by Employee and to enjoin the violation by Employee of any
provisions hereof.
8. Standards. The
Employee shall perform his duties under this Agreement in accordance with such
reasonable business standards as the Board may establish from time to time and
in conformity with the rules and regulations promulgated by such other Federal
and state regulatory bodies which have responsibility for oversight of the
business conducted by the Company.
9. Vacation and Sick
Leave. At such reasonable times as the Board shall in its
discretion permit, the Employee shall be entitled, without loss of pay, to be
voluntarily absent from the performance of employment duties under this
Agreement, all such voluntary absences to count as vacation time, provided
that:
(a) The
Employee shall be entitled to an annual vacation in accordance with the policies
that the Board periodically establishes, but no less than three (3) weeks per
year; provided that Employee will not take more than two (2)
consecutive weeks without the prior written consent of the Company.
(b) The
Employee shall not receive any additional compensation from the Company on
account of failure to take a vacation, and the Employee shall not accumulate
unused vacation from one fiscal year to the next, except in either case to the
extent authorized by the Board.
(c) In
addition to the foregoing paid vacations, the Employee shall be
entitled without loss of pay, to be voluntarily absent from the performance of
his employment with the Company for religious holidays and for such additional
periods of time and for such valid and legitimate reasons as the Board may in
its reasonable business discretion determine.
(d) In
addition, the Employee shall be entitled to an annual sick leave benefit as
established by the Board.
10. Termination. The
Employee’s employment hereunder may be terminated under the following
circumstances:
(a) Just Cause. The
Board may immediately terminate the Employee’s employment at any time, for Just
Cause. As used herein, “Just
Cause” shall
mean the Employee’s (i) commission of an act of fraud, misappropriation of funds
or embezzlement in connection with his duties or dishonesty having a material
adverse impact on the Company; (ii) willful violation of a material provision of
the Company's policies or codes of ethics, or any applicable state or
federal law or regulation; (iii) failure or refusal to perform a lawful
directive of the Board, after written notice to Employee and Employee’s failure
to correct the same within thirty (30) days (or within such additional period as
may be required by the circumstances, provided Employee is diligently pursuing
such correction), provided however that in the event Employee is provided notice
of such failure or refusal more than two (2) times during the Term, no cure
period shall be required thereafter and Employee shall be subject to immediate
termination; or (iv) conviction of, or entering into, a plea of guilty or
no contest to, a felony under state or federal law. The Employee
shall have no right to receive compensation or other benefits for any period
after termination for Just Cause except those accrued through such
date.
(b) Termination by the Company Without
Just Cause. The Company may at any time immediately terminate
Employee’s employment with the Company without Just Cause. If the Company
terminates Employee’s employment without Just Cause, the Company shall be
obligated to pay the Employee; (i) Base Compensation for the lesser of (x) an
amount equal to six (6) months Base Compensation or (y) the number of months
until the end of the Term and (ii) the Performance Bonus, if any, pro rated for
the year in which such termination occurs.
(c) Resignation by
Employee. The Employee may voluntarily terminate employment
with the Company during the Term of this Agreement upon at least thirty (30)
days prior written notice to the Board, in which case the Employee shall be
entitled to receive the Base Compensation and any accrued benefits and expenses
through the date of resignation.
(d) Death, or
Disability. If the Employee’s employment terminates during the
Term of this Agreement due to death or a disability, the Employee shall be
deemed to have voluntarily terminated Employee’s employment as of the date of
such death or disability.
11. Successors and
Assigns. This Agreement shall inure to the benefit of and be
binding upon any corporate or other successor of the Company which shall
acquire, directly or indirectly, by merger, consolidation, purchase or
otherwise, all or substantially all of the assets or a majority of the stock of
the Company. As the Company is contracting for the unique and
personal skills of the Employee, the Employee shall be precluded from assigning
or delegating rights or duties hereunder without first obtaining the written
consent of the Company.
12. Amendments. No
amendments or additions to this Agreement shall be binding unless made in
writing and signed by all of the parties, except as herein otherwise
specifically provided.
13. Confidentiality of this
Agreement. Employee shall not publicize the terms of this
Agreement and shall not disclose to any other employee of the Company or third
party the contents of this Agreement or the rights granted hereunder, except
under subpoena or force of law.
14. Applicable
Law. Except to the extent preempted by Federal law, the laws
of the State of New York shall govern this Agreement in all respects, whether as
to its validity, construction, capacity, performance or otherwise.
15. Severability. The
provisions of this Agreement shall be deemed severable and the invalidity or
unenforceability of any provision shall not affect the validity or
enforceability of the other provisions hereof.
16. Survival. It
is agreed by the parties that the provisions of Article 7, “Non-Competition and
Protection of Confidential Information” shall survive the termination of this
Agreement.
17. Entire
Agreement. This Agreement, together with any understanding or
modifications thereof as agreed to in writing by the parties, shall constitute
the entire Agreement between the parties hereto.
IN WITNESS WHEREOF, the parties have
executed this Agreement on the day and year first hereinabove
written.
EMERGING
VISION, INC.
By: /s/▇▇▇▇
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Name: ▇▇▇▇
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Title: Chairman
of the Board
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