Exhibit 10.48

 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”), dated as of
October 13, 2010 (the “Effective Date”), between Rafaella Apparel Group, Inc.
(the “Company”) and Richard Metzger (the “Executive”, and together with the
Company, the “Parties”).

 

WHEREAS, the Executive is currently employed by the Company pursuant to the
terms of a letter agreement between the Company and the Executive, dated as of
September 12, 2007 (the “Prior Agreement”); and

 

WHEREAS, the Company desires to amend and restate the terms of the Prior
Agreement and the Executive wishes to continue his employment with the Company
on the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of the premises and mutual agreements
hereinafter contained, the Parties hereto agree as follows:

 

1.             Term.  This Agreement and the employment relationship hereunder
shall commence on the Effective Date and continue until the Executive’s
employment terminates in accordance with Section 4.  As used in this Agreement,
the “Term” shall refer to the period beginning on the Effective Date and ending
on the date the Executive’s employment terminates in accordance with Section 4. 
In the event that the Executive’s employment with the Company terminates, the
Company’s obligation to continue to pay all base salary, as adjusted, bonus and
other benefits then accrued shall terminate except as may be provided for in
Section 5.

 

2.             Duties and Title.

 

2.1           Title.  The Company shall employ the Executive to render exclusive
and full-time services to the Company and its subsidiaries.  The Executive shall
serve in the capacity of Executive Vice-President of Design of the Company and
shall report to the Chief Executive Officer of the Company (the “CEO”) or any
other executive officer of the Company as may be directed by the CEO or the
Board of Directors of the Company (the “Board”).

 

2.2           Duties.  The Executive will have such authority and
responsibilities and will perform such duties customarily performed by an
executive vice-president of design of a company in similar lines of business as
the Company and its subsidiaries or as may be assigned to the Executive by the
CEO.  The Executive will devote all his full working-time and attention to the
performance of such duties and to the promotion of the business and interests of
the Company and its subsidiaries; provided, that the Executive may engage in
philanthropic activities and passive investment activities as long as such
activities do not conflict with or materially interfere with the performance of
his duties, as reasonably determined by the Board.

 

3.             Compensation and Benefits by the Company.  As compensation for
all services performed by the Executive for the Company and its subsidiaries,
the Company shall provide the Executive the following during the Term:

 

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3.1           Base Salary.  The Company will pay to the Executive an annual base
salary of $375,000, payable in accordance with the customary payroll practices
of the Company (“Base Salary”).  The then current Base Salary shall be reviewed
annually.

 

3.2           Bonuses.  The Executive will be eligible to receive an annual
bonus (“Bonus”) based on annual pre-tax profits under a plan established by the
Company.  The Executive’s target bonus shall be fifty percent (50%) of Base
Salary, with the actual amount of each Bonus being determined as provided under
such plan.  For any partial fiscal years, the Bonus will be prorated based on
the number of days of actual employment during a three hundred and sixty five
(365)-day fiscal year.  The Bonus will be paid on September 30th of the
Company’s immediately subsequent fiscal year in which the services required for
payment have been performed.

 

3.3           Participation in Employee Benefit Plans.  The Executive shall be
entitled, if and to the extent eligible, to participate in all of the applicable
benefit plans of the Company that are available to other senior executives of
the Company, on terms which are at least as favorable as the terms for other
senior executives.  The Company may at any time or from time to time amend,
modify, suspend or terminate any employee benefit plan, program or arrangement
for any reason without the Executive’s consent if such amendment, modification,
suspension or termination is consistent with the amendment, modification,
suspension or termination for other executives of the Company.

 

3.4           Vacation.  The Executive shall be entitled to a paid vacation
schedule on terms at least as favorable as for other executives of the Company;
provided, however that such vacation shall be a minimum of four (4) weeks of
paid vacation annually.  Vacation carry-over policy shall be the same terms as
those enforced for other executives of the Company.

 

3.5           Expense Reimbursement.  The Executive shall be entitled to receive
reimbursement for all appropriate business expenses incurred by him in
connection with his duties under this Agreement in accordance with the policies
of the Company as in effect from time to time.

 

3.6           Equity Grant.  The Executive shall be eligible to participate in
the Company’s Equity Incentive Plan (the “Equity Incentive Plan”).  The
Executive shall receive an equity grant to be determined by the Board subsequent
to the execution hereof.  The equity award shall be subject to the terms and
conditions of the Equity Incentive Plan and the Company’s customary
documentation with respect thereto.

 

4.             Termination of Employment.

 

4.1           Due to Death of the Executive.  The Executive’s employment shall
terminate immediately upon his death.

 

4.2           Due to Disability of the Executive.  The Executive’s employment
shall terminate upon the Executive’s “Disability.”  For the purposes of this
Agreement, “Disability” means a determination by the Company in accordance with
applicable law that as a result of a physical or mental injury or illness, the
Executive is unable to perform the essential functions of his job with or
without reasonable accommodation for a period of ninety (90) consecutive days in
any three hundred and sixty (360)-day period.

 

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4.3           By the Company.  The Company may terminate the Executive’s
employment at any time during the Term with or without “Cause,” upon written
notice by the Company to the Executive, and the Executive’s employment will
terminate on the date specified in such written notice.

 

For the purposes of this Agreement, “Cause” means (i) commission of a felony by
the Executive or embezzlement from the Company; (ii) other acts of dishonesty by
the Executive resulting or intending to result in personal gain or enrichment at
the expense of the Company or its subsidiaries; (iii) the Executive’s material
breach of his obligations under this Agreement; (iv) conduct by the Executive in
connection with his duties hereunder that is fraudulent, unlawful or grossly
negligent, including, but not limited to, acts of discrimination; (v) engaging
in personal conduct by the Executive (including but not limited to employee
harassment or discrimination, the use or possession at work of any illegal
controlled substance) which seriously discredits or damages the Company or its
subsidiaries; (vi) contravention of specific lawful direction from the CEO (or
from any other executive officer of the Company to who the Executive reports) or
continuing inattention to or continuing failure to adequately perform the duties
to be performed by the Executive under the terms of Section 2.2; or (vii) breach
of the Executive’s covenants set forth in Section 6 below before termination of
employment; provided, that solely with respect to sub-clauses (iii) and
(vi) immediately preceding, the Executive shall have fifteen (15) days after
notice from the Company to cure the deficiency (if such deficiency is curable)
leading to any such determination of Cause.  A termination for “Cause” shall be
effective immediately (or on such other date set forth by the Company).

 

4.4           By the Executive.  The Executive may terminate his employment with
the Company at any time during the Term for any reason, upon thirty (30) days
written notice by the Executive to the Company.

 

4.5           Automatic Termination of Other Positions.  Upon the Executive no
longer being employed by the Company for any reason whatsoever, the Executive
shall automatically be deemed to have resigned as an officer and director of all
subsidiaries of the Company without any further action being required by the
Executive, the Company or any subsidiary of the Company.

 

5.             Severance Payment.

 

5.1           By the Company for Cause or by the Executive for any reason or Due
to Death or Disability.  If: (i) the Executive’s employment terminates due to
his death; (ii) the Company terminates the Executive’s employment with the
Company for Cause; (iii) the Company terminates the Executive’s employment with
the Company due to the Executive’s Disability; or (iv) the Executive terminates
his employment for any reason, then the Executive or the Executive’s legal
representatives (as appropriate), shall be entitled to receive the following:

 

(a)           the Executive’s accrued but unpaid Base Salary, if any, to the
date of termination, payable within thirty (30) days after the termination of
the Executive’s employment;

 

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(b)           the unpaid portion of the Bonus, if any, relating to the fiscal
year immediately prior to the fiscal year of the Executive’s death, Disability,
resignation or termination by the Company for Cause payable in accordance with
Section 3.2;

 

(c)           expenses reimbursable under Section 3.5 incurred but not yet
reimbursed to the Executive to the date of termination, payable within thirty
(30) days after the termination of the Executive’s employment; and

 

(d)           any rights the Executive may have under the Company’s benefit
plans and the Consolidated Omnibus Budget Reconciliation Act.

 

5.2           By the Company Without Cause.  If during the Term the Company
terminates the Executive’s employment without Cause (which may be done at any
time without prior notice), then, in addition to the payments upon termination
specified in Section 5.1, the Executive shall receive, upon execution without
revocation of a valid release agreement in a form acceptable to the Company,
continued payment of Base Salary for a period of six (6) months following the
date of termination.

 

6.             Restrictions and Obligations of the Executive.

 

6.1           Confidentiality.

 

(a)           During the course of the Executive’s service relationship with the
Company and its affiliates, the Executive will have access to certain trade
secrets and confidential information relating to the Company and its
subsidiaries (the “Protected Parties”) which is not readily available from
sources outside the Company.  The confidential and proprietary information and
trade secrets of the Protected Parties are among their most valuable assets,
including but not limited to, their customer, supplier and vendor lists,
databases, competitive strategies, computer programs, frameworks, or models,
their marketing programs, their sales, financial, marketing, training and
technical information, their product development (and proprietary product data)
and any other information, whether communicated orally, electronically, in
writing or in other tangible forms concerning how the Protected Parties create,
develop, acquire or maintain their products and marketing plans, target their
potential customers and operate their retail and other businesses.  The
Protected Parties invested, and continue to invest, considerable amounts of time
and money in their process, technology, know-how, obtaining and developing the
goodwill of their customers, their other external relationships, their data
systems and data bases, and all the information described above (hereinafter
collectively referred to as “Confidential Information”), and any
misappropriation or unauthorized disclosure of Confidential Information in any
form would irreparably harm the Protected Parties.  The Executive acknowledges
that such Confidential Information constitutes valuable, highly confidential,
special and unique property of the Protected Parties.  The Executive shall hold
in a fiduciary capacity for the benefit of the Protected Parties all
Confidential Information relating to the Protected Parties and their businesses,
which shall have been obtained by the Executive during the Executive’s
employment by the Company or its subsidiaries and which shall not be or become
public knowledge (other than by acts by the Executive or representatives of the
Executive in violation of this

 

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Agreement).  Except as required by law or an order of a court or governmental
agency with jurisdiction or a subpoena or other legal process, the Executive
shall not, during the period the Executive is employed by the Company or its
subsidiaries or at any time thereafter, disclose any Confidential Information,
directly or indirectly, to any person or entity for any reason or purpose
whatsoever, nor shall the Executive use it in any way, except in the course of
the Executive’s employment with, and for the benefit of, the Protected Parties
or to enforce any rights or defend any claims hereunder or under any other
agreement to which the Executive is a party; provided, that such disclosure is
relevant to the enforcement of such rights or defense of such claims and is only
disclosed in the formal proceedings related thereto.  The Executive shall take
all reasonable steps to safeguard the Confidential Information and to protect it
against disclosure, misuse, espionage, loss and theft.  The Executive
understands and agrees that the Executive shall acquire no rights to any such
Confidential Information.

 

(b)           All files, records, documents, drawings, specifications, data,
computer programs, evaluation mechanisms and analytics and similar items
relating thereto or to the Business (for the purposes of this Agreement,
“Business” shall be as defined in Section 6.3), as well as all customer lists,
specific customer information, compilations of product research and marketing
techniques of the Company and its subsidiaries, whether prepared by the
Executive or otherwise coming into the Executive’s possession, shall remain the
exclusive property of the Company and its subsidiaries, and the Executive shall
not remove any such items from the premises of the Company and its subsidiaries,
except in furtherance of the Executive’s duties under any employment agreement.

 

(c)           It is understood that while employed by the Company or its
subsidiaries, the Executive will promptly disclose to it, and assign to it the
Executive’s interest in any invention, improvement or discovery made or
conceived by the Executive, either alone or jointly with others, which arises
out of the Executive’s employment.  At the Company’s request and expense, the
Executive will assist the Company and its subsidiaries during the period of the
Executive’s employment by the Company or its subsidiaries and thereafter in
connection with any controversy or legal proceeding relating to such invention,
improvement or discovery and in obtaining domestic and foreign patent or other
protection covering the same.

 

(d)           As requested by the Company and at the Company’s expense, from
time to time and upon the termination of the Executive’s employment with the
Company for any reason, the Executive will promptly deliver to the Company and
its subsidiaries all copies and embodiments, in whatever form, of all
Confidential Information in the Executive’s possession or within his control
(including, but not limited to, memoranda, records, notes, plans, photographs,
manuals, notebooks, documentation, program listings, flow charts, magnetic
media, disks, diskettes, tapes and all other materials containing any
Confidential Information) irrespective of the location or form of such
material.  If requested by the Company, the Executive will provide the Company
with written confirmation that all such materials have been delivered to the
Company as provided herein.

 

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6.2           Non-Solicitation or Hire.  During the Term and for a period of six
(6) months following the termination of the Executive’s employment for any
reason, the Executive shall not, directly or indirectly (i) solicit or attempt
to solicit or induce, directly or indirectly, any party who is a customer of the
Company or its subsidiaries, or who was a customer of the Company or its
subsidiaries at any time during the twelve (12) month period immediately prior
to the date the Executive’s employment terminates, for the purpose of marketing,
selling or providing to any such party any services or products offered by or
available from the Company or its subsidiaries (or services or products that
were contemplated or planned to be offered by the Company or any of its
subsidiaries during the Term of the Executive’s employment), (b) solicit or
attempt to solicit or induce, directly or indirectly, any supplier to the
Company or any subsidiary to terminate, reduce or alter negatively its
relationship with the Company or any subsidiary or in any manner interfere with
any agreement or contract between the Company or any subsidiary and such
supplier, (c) hire, directly or indirectly, any employee of the Company or any
of its subsidiaries or any person who was an employee of the Company or any of
its subsidiaries during the twelve (12) month period immediately prior to the
date the Executive’s employment terminates, or (d) solicit or attempt to
solicit, directly or indirectly, any person who was an employee of the Company
or any of its subsidiaries or any person who was an employee of the Company or
any of its subsidiaries during the twelve (12) month period immediately prior to
the date the termination of the Executive’s employment, to terminate such
employee’s employment relationship and/or to enter into a similar relationship
with the Executive, or any other person or any other person or entity.

 

6.3           Non-Competition.  During the Term and for a period of six
(6) months following the termination of the Executive’s employment by the
Company (for any reason), the Executive shall not, whether individually, as a
director, manager, member, stockholder, partner, owner, employee, consultant or
agent of any business, or in any other capacity, other than on behalf of the
Company or a subsidiary, organize, establish, own, operate, manage, control,
engage in, participate in, invest in, permit his name to be used by, act as a
consultant or advisor to, render services for (alone or in association with any
person, firm, corporation or business organization), or otherwise assist any
person or entity that engages in or owns, invests in, operates, manages or
controls any venture or enterprise which engages or proposes to engage in the
women’s career and casual separates clothing business in the geographic
locations where the Company and its subsidiaries engage or propose to engage in
such business (the “Business”).  Notwithstanding the foregoing, nothing in this
Agreement shall prevent the Executive from owning for passive investment
purposes not intended to circumvent this Agreement, less than five percent (5%)
of the publicly traded common equity securities of any company engaged in the
Business (so long as the Executive has no power to manage, operate, advise,
consult with or control the competing enterprise and no power, alone or in
conjunction with other affiliated parties, to select a director, manager,
general partner, or similar governing official of the competing enterprise other
than in connection with the normal and customary voting powers afforded the
Executive in connection with any permissible equity ownership).

 

6.4           Property.  The Executive acknowledges that all originals and
copies of materials, records and documents generated by him or coming into his
possession during his employment by the Company or its subsidiaries are the sole
property of the Company and its subsidiaries (“Company Property”).  During the
Term, and at all times thereafter, the Executive shall not remove, or cause to
be removed, from the premises of the Company or its subsidiaries, copies of

 

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any record, file, memorandum, document, computer related information or
equipment, or any other item relating to the business of the Company or its
subsidiaries, except in furtherance of his duties under this Agreement.  When
the Executive’s employment with the Company terminates, or upon request of the
Company at any time, the Executive shall promptly deliver to the Company all
copies of Company Property in his possession or control.

 

7.             Nondisparagement.  The Executive agrees that he will not at any
time (whether during or after the Term) publish or communicate to any person or
entity any Disparaging (as defined below) remarks, comments or statements
concerning the Company, Cerberus Capital Management, L.P., their parents,
subsidiaries and affiliates, and their respective present and former members,
partners, directors, officers, shareholders, employees, agents, attorneys,
successors and assigns.  “Disparaging” remarks, comments or statements are those
that impugn the character, honesty, integrity or morality or business acumen or
abilities in connection with any aspect of the operation of business of the
individual or entity being disparaged.

 

8.             Remedies; Specific Performance.  The Parties acknowledge and
agree that the Executive’s breach or threatened breach of any of the
restrictions set forth in Section 6 and Section 7 will result in irreparable and
continuing damage to the Protected Parties for which there may be no adequate
remedy at law and that the Protected Parties shall be entitled to equitable
relief, including specific performance and injunctive relief as remedies for any
such breach or threatened or attempted breach without the necessity of the
posting of a bond or surety therefor.  The Executive hereby consents to the
granting of equitable relief, including but limited to the granting of
injunctive relief (temporary or otherwise) against the Executive or the entry of
any other court order against the Executive prohibiting and enjoining him from
violating, or directing him to comply with any provision of Section 6 or
Section 7.  The Executive also agrees that such remedies shall be in addition to
any and all remedies, including damages, available to the Protected Parties
against him for such breaches or threatened or attempted breaches.  In addition,
without limiting the Protected Parties’ remedies for any breach of any
restriction on the Executive set forth in Section 6 or Section 7, except as
required by law, the Executive shall not be entitled to any payments set forth
in Section 5.2 hereof if the Executive has breached the covenants applicable to
the Executive contained in Section 6 or Section 7, the Executive will
immediately return to the Protected Parties any such payments previously
received under Section 5.2 upon such a breach, and, in the event of such breach,
the Protected Parties will have no obligation to pay any of the amounts that
remain payable by the Company under Section 5.2.

 

9.             Indemnification. The Company agrees, to the extent permitted by
applicable law and its organizational documents, to indemnify, defend and hold
harmless the Executive from and against any and all losses, suits, actions,
causes of action, judgments, damages, liabilities, penalties, fines, costs or
claims of any kind or nature (“Indemnified Claim”), including reasonable legal
fees and related costs incurred by the Executive in connection with the
preparation for or defense of any Indemnified Claim, whether or not resulting in
any liability, to which the Executive may become subject or liable or which
may be incurred by or assessed against the Executive, relating to or arising out
of his employment by the Company or the services to be performed pursuant to
this Agreement; provided, that the Company shall only defend, but not indemnify
or hold the Executive harmless, from and against an Indemnified Claim in the
event there is a final, non-appealable, determination that the Executive’s
liability with respect to such Indemnified Claim resulted from the Executive’s
willful misconduct or gross

 

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negligence. The Company’s obligations under this Section shall be in addition to
any other right, remedy or indemnification which the Executive may have or be
entitled to at common law or otherwise.

 

10.           Other Provisions.

 

10.1         Notices.  Any notice or other communication required or which may
be given hereunder shall be in writing and shall be delivered personally, sent
by facsimile transmission or sent by certified, registered or express mail,
postage prepaid or overnight mail and shall be deemed given when so delivered
personally, or sent by facsimile transmission or, if mailed, four (4) days after
the date of mailing or one (1) day after overnight mail, as follows:

 

(a)           If the Company, to:

 

Rafaella Apparel Group, Inc.

1411 Broadway

New York, New York 10018

Attention:  Secretary

Telephone:  (212) 403-0300

Fax:  (212) 764-9275

 

(b)           If the Executive, to the Executive’s home address reflected in the
Company’s records.

 

10.2         Entire Agreement.  This Agreement contains the entire agreement
between the Parties with respect to the subject matter hereof and supersedes all
prior agreements, written or oral, with respect thereto, including, but not
limited to the Prior Agreement.

 

10.3         Representations and Warranties by the Executive.  The Executive
represents and warrants that he is not a party to or subject to any restrictive
covenants, legal restrictions or other agreements in favor of any entity or
person which would in any way preclude, inhibit, impair or limit the Executive’s
ability to perform his obligations under this Agreement, including, but not
limited to, non-competition agreements, non-solicitation agreements or
confidentiality agreements.

 

10.4         Waiver and Amendments.  This Agreement may be amended, modified,
superseded, canceled, renewed or extended, and the terms and conditions hereof
may be waived, only by a written instrument signed by the Parties or, in the
case of a waiver, by the party waiving compliance.  No delay on the part of any
party in exercising any right, power or privilege hereunder shall operate as a
waiver thereof, nor shall any waiver on the part of any right, power or
privilege hereunder, nor any single or partial exercise of any right, power or
privilege hereunder, preclude any other or further exercise thereof or the
exercise of any other right, power or privilege hereunder.

 

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10.5         Governing Law, Dispute Resolution and Venue.

 

(a)           This Agreement shall be governed and construed in accordance with
the laws of the State of New York applicable to agreements made and not to be
performed entirely within such state, without regard to conflicts of laws
principles.

 

(b)           The parties agree irrevocably to submit to the exclusive
jurisdiction of the federal courts or, if no federal jurisdiction exists, the
state courts, located in the City of New York, Borough of Manhattan, for the
purposes of any suit, action or other proceeding brought by any party arising
out of any breach of any of the provisions of this Agreement and hereby waive,
and agree not to assert by way of motion, as a defense or otherwise, in any such
suit, action, or proceeding, any claim that it is not personally subject to the
jurisdiction of the above-named courts, that the suit, action or proceeding is
brought in an inconvenient forum, that the venue of the suit, action or
proceeding is improper, or that the provisions of this Agreement may not be
enforced in or by such courts.  In addition, the parties agree to the waiver of
a jury trial.

 

10.6         Assignability by the Company and the Executive.  This Agreement,
and the rights and obligations hereunder, may not be assigned by the Company or
the Executive without written consent signed by the other party; provided, that
the Company may assign this Agreement to any successor that continues the
business of the Company.

 

10.7         Counterparts.  This Agreement may be executed in one or more
original, facsimile or electronic counterparts, each of which shall be deemed an
original but all of which shall constitute one and the same instrument.

 

10.8         Headings.  The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning of terms
contained herein.

 

10.9         Severability.  If any term, provision, covenant or restriction of
this Agreement, or any part thereof, is held by a court of competent
jurisdiction of any foreign, federal, state, county or local government or any
other governmental, regulatory or administrative agency or authority to be
invalid, void, unenforceable or against public policy for any reason, the
remainder of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way be affected or
impaired or invalidated.  The Executive acknowledges that the restrictive
covenants contained in Section 6 and Section 7 constitute a condition to the
Company’s entry into this Agreement and are reasonable and valid in temporal
scope and in all other respects.

 

10.10       Judicial Modification.  If any court determines that any of the
covenants in Section 6 or Section 7, or any part of any of them, is invalid or
unenforceable, the remainder of such covenants and parts thereof shall not
thereby be affected and shall be given full effect, without regard to the
invalid portion.  If any court determines that any of such covenants, or any
part thereof, is invalid or unenforceable because of the geographic or temporal
scope of such provision, such court shall reduce such scope to the minimum
extent necessary to make such covenants valid and enforceable.

 

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10.11       Tax Withholding.  The Company or other payor is authorized to
withhold from any benefit provided or payment due hereunder, the amount of
withholding taxes due any federal, state or local authority in respect of such
benefit or payment and to take such other action as may be necessary in the
opinion of the Board to satisfy all obligations for the payment of such
withholding taxes.

 

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IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound hereby,
have executed this Amended and Restated Employment Agreement as of the day and
year first above mentioned.

 

 

 

EXECUTIVE

 

 

 

 

 

/s/ Richard Metzger

 

Richard Metzger

 

 

 

 

 

RAFAELLA APPAREL GROUP, INC.

 

 

 

 

 

By:

/s/ Christa Michalaros

 

 

Name: Christa Michalaros

 

 

Title: Chief Executive Officer

 

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