Exhibit 10.1
Execution Copy
EMPLOYMENT AGREEMENT
This Employment Agreement (the “Agreement”) made this 14th day of November,
2011, by and among Crumbs Bake Shop, Inc. (f/k/a 57th Street General Acquisition
Corp.), a Delaware corporation having an office at 110 West 40th Street,
Suite 2100, New York, New York 10018 (the “Company”); Crumbs Holdings LLC, a
Delaware limited liability company having an office at 110 West 40th Street,
Suite 2100, New York, New York 10018 (“Crumbs”, and together with the Company,
the “Companies”) and Julian R. Geiger, residing at 7 Chowning Drive, Malvern,
Pennsylvania 19355 (the “Executive”).
WHEREAS, the Companies and each of them wish to employ the Executive as the
President and Chief Executive Officer of the Companies and the Executive wishes
to accept such employment, all on the terms and conditions hereinafter set
forth;
NOW, THEREFORE, in consideration of the mutual covenants and promises made
herein, the parties hereto agree as follows:
1. Definitions.
For purposes of this Agreement, the terms listed below shall be defined as
indicated.
Aéropostale: Aéropostale, Inc., a Delaware corporation having an office at 112
West 34th Street, New York, New York 10120.
Affiliate: A domestic or foreign business entity controlled by, controlling or
under common control with either of the Company or Crumbs, as applicable.
Ancillary Documents: The Securities Grant Agreement, the Registration Rights
Agreement, the Tax Receivables Agreement, the Exchange and Support Agreement and
the Crumbs LLC Agreement.
Board: The Board of Directors of the Company.
Business Combination Agreement: That certain Business Combination Agreement,
dated as of January 9, 2011, as amended on each of February 18, 2011, March 17,
2011 and April 7, 2011, in each case by and among the Company, 57th Street
Merger Sub LLC, Crumbs, the members of Crumbs, and their representatives, as set
forth on the signature pages thereto.
Cause: See Section 4(a).
Change of Control: Either (i) the acquisition by any person or entity of,
directly or indirectly, Beneficial Ownership (as defined in Rule 13d-3 of the
Securities Exchange Act of 1934, as amended) of securities of the Company
representing 50% (or more) of the total voting power of all of the Company’s
then outstanding voting securities; or (ii) a merger or consolidation of the
Company in which the Company’s voting securities immediately prior to the merger
or consolidation do not represent, or are not converted into securities (owned
by stockholders in substantially the same proportions as their ownership
immediately prior to such merger or consolidation) that represent, a majority of
the voting power of all of the voting securities of the surviving entity
immediately after the merger or consolidation; or (iii) a sale of substantially
all of the assets of the Company or Crumbs or a liquidation or dissolution of
the Company; or (iv) individuals, who, as of the Effective Date, constitute the
Board (the “Incumbent Board”) cease for any reason to constitute at least a
majority of such Board; provided, that any individual who becomes a director of
the Company subsequent to the Effective Date as a designee of the holders of the
Company’s Series A Voting Preferred Stock or whose election or nomination for
election by the Company’s stockholders was approved by the vote of at least a
majority of the directors then in office shall be deemed a member of the
Incumbent Board.

 

 

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Class B Grant: See Section 3(c)(i)(x).
Confidential Information: All secret proprietary information of the Company and
the Subsidiaries, not otherwise publicly disclosed (except if disclosed by the
Executive in violation of this Agreement), whether or not discovered or
developed by the Executive, known by the Executive as a consequence of the
Executive’s service to or employment with the Companies at any time (including
prior to the commencement of this Agreement) as a director, employee or agent.
Without limiting the generality of the foregoing, such proprietary information
shall include (a) customer lists, (b) acquisition, expansion, marketing,
financial and other business information and plans, (c) research and
development, (d) computer programs, (e) sources of supply, (f) identity of
specialized consultants and contractors and confidential information developed
by them for the Company and the Subsidiaries, (g) purchasing, operating and
other cost data, (h) special customer needs, cost and pricing data,
(i) manufacturing methods, (j) quality control information, (k) inventory
techniques, and (1) employee information; provided, that any of such information
is not generally known to the public or in the industries in which the Company
and the Subsidiaries are conducting business or shall at any time during the
term of this Agreement conduct business, including (without limitation) the
industry of selling, marketing and developing cupcakes. Confidential Information
also includes the overall business, financial, expansion and acquisition plans
of the Company and the Subsidiaries, and includes information contained in
manuals, memoranda, projections, minutes, plans, drawings, designs, formula
books, specifications, computer programs and records, whether or not marked or
otherwise identified by the Company and the Subsidiaries as Confidential
Information, as well as information which is the subject of meetings and
discussions and not so recorded.
Contingent Grant: See Section 3(c)(ii).
Crumbs LLC Agreement: The Third Amended and Restated Limited Liability Company
Agreement of Crumbs, dated and effective as of May 5, 2011, as amended from time
to time.
Disability: The absence, on a full-time basis, of the Executive from the
Executive’s duties under this Agreement for a total of 120 days during any
12-month period hereunder as a result of incapacity due to mental or physical
illness which is determined to be permanent by a physician selected by the
Company and acceptable to the Executive or the Executive’s legal representative
(such agreement as to acceptability not to be withheld unreasonably).

 

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Effective Date: See Section 4.
Exchange and Support Agreement: The Exchange and Support Agreement, dated as of
May 5, 2011, by and among the Company, Crumbs and the Persons set forth on the
signature pages thereof and their Permitted Transferees (as defined therein).
Good Reason: See Section 4(b).
Inventions: Those discoveries, developments, concepts and ideas, whether or not
patentable, relating to the present, future and prospective activities and
Products and Services of the Company and the Subsidiaries, which such activities
and Products and Services are known to the Executive by virtue of the
Executive’s service to or employment with the Company and the Subsidiaries.
New Crumbs Class B Exchangeable Units: shall have the meaning ascribed to such
term in the Crumbs LLC Agreement.
Parent Series A Voting Preferred Stock: shall have the meaning ascribed to such
term in the Exchange and Support Agreement.
Products and Services: All products or services sold, rented, leased, rendered
or otherwise made available to its customers by the Company and the
Subsidiaries, or otherwise the subject of the business of the Company and the
Subsidiaries.
Registration Rights Agreement: The Registration Rights Agreement entered into as
of the 14th day of November, 2011, by and among the Company, Crumbs and the
Executive.
Securities Grant Agreement: The Securities Grant Agreement entered into as of
the 14th day of November, 2011, by and among the Company, Crumbs and the
Executive.
Series A Grant: See Section 3(c)(i)(y).
Services Agreement: The Services Agreement between Aéropostale and the
Executive, dated as of December 1, 2010, and terminating January 31, 2012,
unless sooner terminated by its terms.
Subsidiary: Any entity, including Crumbs, of which the Company and/or Crumbs
owns, directly or indirectly, 50% or more of the aggregate voting power of the
voting securities.
Tax Receivables Agreement: The Tax Receivables Agreement, dated as of May 5,
2011, by and among the Company, Crumbs, and each of the parties thereto
identified as “Members” therein.
2. Employment.
(a) Subject to the terms and conditions of this Agreement, the Companies hereby
agree to employ the Executive, and the Executive hereby accepts employment, in
the position of President and Chief Executive Officer of the Companies. The
Executive agrees to perform to the best of the Executive’s ability, experience
and talent those acts and duties and to furnish those services to the Company
and the Subsidiaries in connection with and related to such position as the
Board shall from time to time direct, provided, such acts and directives are
consistent with the duties of President and Chief Executive Officer. The
Executive shall, subject to Section 2(d), use his best efforts to promote the
interests of the Company and the Subsidiaries.

 

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(b) During the term of this Agreement, the Executive’s principal place of
employment shall be located at the Company’s principal place of business, set
forth above, and the Executive shall be provided with secretarial services, an
office and similar support services and facilities as appropriate to the
Executive’s position.
(c) During the term of this Agreement, except as set forth in Section 2(d), the
Executive shall devote his full business time and best efforts to the business
affairs of the Companies (individually and jointly); provided, however, that the
Executive may devote reasonable time and attention to:
(i) serving as a director of, or member of a committee of the directors of, any
not-for-profit organization, or engaging in other charitable or community
activities; and
(ii) serving as a director of (including as chairman of), or member of a
committee of the directors of, the corporations or organizations for which the
Executive presently serves in such capacity, including Aéropostale, and such
other corporations and organizations that the Board may from time to time
approve in the future; and
(iii) owning and managing personal and family assets, including a family-owned
inn in Massachusetts and related or comparable properties and enterprises.
(d) The Companies (individually and jointly) understand that (i) the Executive
serves as Chairman of the Board of Aéropostale and (ii) pursuant to the Services
Agreement, the Executive serves as an advisor and consultant to that company and
that such advisory and consulting services shall continue until January 31,
2012. The Companies (individually and jointly) agree that, until February 6,
2012, the Executive’s performance of his duties hereunder shall necessarily be
on a part-time basis.
3. Compensation and Benefits.
(a) Salary.
The Executive shall receive no salary hereunder.
(b) Bonus.
The Executive shall not participate in any bonus plan of the Companies or either
of them that may be in effect during the term of this Agreement.

 

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(c) Equity.
(i) New Crumbs Class B Exchangeable Units; Parent Series A Voting Preferred
Stock: Reasonably promptly following the execution of this Agreement, (x) Crumbs
shall grant, or shall cause to be granted to the Executive 799,000 New Crumbs
Class B Exchangeable Units (the “Class B Grant”) and (y) the Company shall
grant, or shall cause to be granted to the Executive 79,900 Parent Series A
Voting Preferred Stock (the “Series A Grant”). The Class B Grant and the
Series A Grant shall each be subject to the following terms and conditions;
provided, that in the event of any inconsistency between the terms of this
Agreement and the terms of any other agreement relating to the Class B Grant
and/or the Series A Grant, the terms of this Agreement shall control.
(A) Fifty percent (50%) of the Class B Grant (the “First Class B Tranche”) and
fifty percent (50%) of the Series A Grant (the “First Series A Tranche”) shall
be fully vested as of the Effective Date;
(B) Fifty percent (50%) of the Class B Grant (the “Second Class B Tranche”) and
fifty percent (50%) of the Series A Grant (the “Second Series A Tranche”) shall
vest on the one-year anniversary of the Effective Date (the “One-Year
Anniversary”) subject to the Executive remaining employed with the Companies
through the One-Year Anniversary; provided, that:
(i) upon the Executive’s termination of employment by the Company or Crumbs
without Cause or by the Executive for Good Reason prior to the One-Year
Anniversary, the Second Class B Tranche and the Second Series A Tranche shall
immediately become fully vested; and
(ii) upon the Executive’s termination of employment with the Companies as a
result of death or Disability prior to the One-Year Anniversary, a portion of
the Second Class B Tranche and the Second Series A Tranche shall immediately
become vested (determined by multiplying the amount of Second Class B Tranche or
Second Series A Tranche, as applicable, by a fraction, the numerator of which is
the number of days from the Effective Date through the date of the Executive’s
termination and the denominator of which is 365).
(C) The Second Class B Tranche and the Second Series A Tranche shall immediately
become fully vested upon a Change of Control prior to the One-Year Anniversary.
(ii) Contingent Equity: The Executive shall be eligible to receive up to an
additional 901,000 New Crumbs Class B Exchangeable Units and 90,100 Parent
Series A Voting Preferred Stock (collectively, the “Contingent Grant”) pursuant
to the terms and conditions of the Securities Grant Agreement but subject to the
terms and conditions of the Business Combination Agreement. For the avoidance of
doubt, the right to receive the Contingent Grant shall survive the termination
of this Agreement or the Executive’s employment for any reason or no reason. In
the event of any inconsistency between the terms of this Agreement and the terms
of any other agreement relating to the Contingent Grant, but specifically
excluding any contrary provision of the Business Combination Agreement governing
the terms and conditions pursuant to which Contingency Consideration (as defined
in the Business Combination Agreement) may become issuable, the terms of this
Agreement shall control.

 

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(iii) Ancillary Documents: On the Effective Date and in connection with the
Class B Grant, the Series A Grant and the Contingent Grant, Executive shall
become a party to the Ancillary Documents and shall have the rights and be
subject to the obligations thereunder.
(iv) Other: The Company agrees to (A) treat the Class B Grant pursuant to
Section 3(c) hereof as a transfer of equity interests in Crumbs from the
Forfeiting Holders (as such term is defined in the Securities Grant Agreement)
to the Executive, and (B) with respect to such transfer, make adjustments to the
basis of property of Crumbs with respect to the Executive pursuant to Section
743(b) of the Code.
(d) Other Benefits.
The Executive shall be entitled to participate, on the same basis and to the
same extent as other executive employees of the Companies (individually or
jointly), in any pension, life insurance, health insurance, short-term
disability and hospital plans and other fringe benefits or benefit plans
presently in effect and hereafter maintained or created by the Companies
(individually or jointly). During the term of this Agreement, the Companies
(individually and jointly) agree not to reduce the benefits provided to the
Executive.
(e) Vacation.
The Executive may take such vacation period or periods during each year as shall
be consonant with the Executive’s responsibilities and with the Company’s
vacation schedule and policies for senior officers (or, if more favorable,
Crumbs’ vacation schedule and policies for senior officers), which vacation
shall be at least four weeks per calendar year.
(f) Expenses.
Pursuant to the Companies’ and each of their customary policies in force at the
time of payment, the Executive shall be promptly reimbursed, against
presentation of vouchers or receipts therefor, for all authorized expenses
properly incurred by the Executive on the Companies’ behalf (individually or
jointly) in the performance of the Executive’s duties hereunder.
4. Term; Termination.
The employment of the Executive by the Companies and each of them shall commence
on November 14, 2011 at 5:00 p.m. (the “Effective Date”) and shall continue
through December 31, 2013, unless earlier terminated:
(a) By the Company for Cause.
The Companies (individually or jointly) may discharge the Executive for Cause.
As used herein, “Cause” shall mean any one or more than one of the following:
(i) Gross negligence or willful misconduct of the Executive in the performance
of his duties hereunder;

 

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(ii) The Executive’s conviction of a fraud, felony or crime of moral turpitude;
(iii) The Executive’s willful failure to follow instructions of the Board, which
instructions are material, legal and not inconsistent with the duties assigned
to the Executive hereunder, and which failure is not cured within five
(5) business days after written notice of such is delivered to the Executive by
the Board with respect to failures which are curable; or
(iv) Any breach of any of the material terms of this Agreement by the Executive
which is not cured within five (5) business days after written notice of breach
is delivered to Executive by the Board with respect to breaches which are
curable.
Upon discharge of the Executive for Cause, the Companies (individually and
jointly) shall be relieved and discharged of all obligations to make payments to
the Executive which would otherwise be due under this Agreement except as to
benefits earned for actual services rendered prior to the date of termination,
reimbursable expenses under Section 3(f), and as otherwise set forth in this
Agreement.
(b) By the Executive for Good Reason.
The Executive may terminate his employment hereunder upon the occurrence of any
of the following:
(i) Any breach of any of the material terms of this Agreement by the Companies
(individually or jointly);
(ii) Without the consent of the Executive, a material reduction in the
authorities, powers, functions and/or duties attached to the Executive’s
position;
(iii) Without the consent of the Executive, the relocation of the principal
location of the Executive’s employment to a location more than 25 miles from its
current location;
(iv) The Executive is removed from or not re-elected to the Board or the office
of Chief Executive Officer of the Companies (individually or jointly); or
(v) There shall occur a Change of Control.
(c) On the Executive’s Death or Disability.
Upon the Executive’s death or Disability, the Companies (individually and
jointly) shall be relieved and discharged of all obligations to make further
payment to the Executive after the date of the death or Disability of the
Executive, except as to benefits earned for actual services rendered prior to
the date of the death or Disability of the Executive, reimbursable expenses
under Section 3(f), and as otherwise set forth in this Agreement.

 

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(d) By the Companies Without Cause.
The Companies (individually or jointly) may, on 30 days written notice to the
Executive, terminate the employment of the Executive without Cause at any time
during the term of this Agreement.
(e) By the Executive Without Good Reason.
The Executive may terminate his employment hereunder at any time upon written
notice to the Companies (individually or jointly). In the event of a termination
by the Executive pursuant to this subsection (e), the Companies (individually
and jointly) shall be relieved and discharged of all obligations to make further
payment to the Executive after the date of termination, except as to benefits
earned for actual services rendered prior to such date, reimbursable expenses
under Section 3(f), and as otherwise set forth in this Agreement. All amounts
payable to the Executive under this Section 4 shall be paid to the Executive in
a single lump sum in cash not later than five (5) days after the date of
termination. Notwithstanding anything to the contrary contained in this
Agreement, termination of this Agreement or the Executive’s employment for any
reason or no reason shall not affect Executive’s rights under the Ancillary
Documents.
5. Inventions, Confidential Information and Related Matters.
(a) All Inventions which are at any time made by the Executive, acting alone or
in conjunction with others, (i) during the term of his employment hereunder, or
(ii) if based on or related to any Confidential Information, made by the
Executive within one year after the termination of this Agreement, shall be the
property of the Company. The Executive agrees that he shall, at the cost and
expense of the Company, execute formal application for United States and foreign
patents, and also do all other acts and things (including, among others, the
execution and delivery of instruments of further assurance or confirmation)
reasonably necessary or desirable at any time to perfect the full assignment to
the Company of the Executive’s right and title (if any) to such Invention.
(b) Except as required by the Executive’s duties hereunder, the Executive shall
not, directly or indirectly, use, publish, disseminate or otherwise disclose any
Confidential Information or Inventions which are the subject of Section 5(a)
without the prior written consent of the Board, except as required by law.
Nothing in this Section 5(b) shall prevent disclosure of information which has
been completely disclosed in a published patent or other integrated publication
of general circulation, nor shall this Section 5 govern the right to use
Inventions for which a patent may have been issued.
6. No Other Contracts.
The Executive represents and warrants that neither the execution and delivery of
this Agreement by the Executive nor the performance by the Executive of the
Executive’s obligations hereunder shall constitute a default under or a breach
of the terms of any other agreement, indenture or contract to which the
Executive is a party or by which the Executive is bound; nor shall the execution
and delivery of this Agreement by the Executive or the performance of the
Executive’s duties and obligations hereunder give rise to any claim or charge
against either the Executive or the Companies (individually or jointly) based
upon any other contract, indenture or agreement to which the Executive is a
party or by which Executive is bound.

 

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7 Representations of the Companies.
The Companies (individually and jointly) hereby represent and warrant to
Executive, and the Companies (individually and jointly) acknowledge that
Executive has relied on such representations and warranties in entering into
this Agreement, as follows:
(i) the Companies (individually and jointly) have all requisite power and
authority to execute and deliver this Agreement and to perform its obligations
hereunder, and this Agreement has been duly executed by the Companies
(individually and jointly);
(ii) the execution, delivery and performance of this Agreement by the Companies
(individually and jointly), does not and will not, with or without notice or the
passage of time, conflict with, breach, violate or cause a default under any
agreement, contract or instrument to which the Companies (individually or
jointly) are a party or any law, judgment, order or decree to which the
Companies (individually or jointly) are subject;
(iii) upon the execution and delivery of this Agreement by the Companies
(individually and jointly) and Executive, this Agreement will be a legal, valid
and binding obligation of the Companies (individually and jointly), enforceable
in accordance with its terms;
(iv) the Companies (individually and jointly) understand that Executive will
rely upon the accuracy and truth of the representations and warranties of the
Companies (individually and jointly) set forth herein and the Companies
(individually and jointly) consent to such reliance; and
(v) the Company, Crumbs and all Subsidiaries are to the best of their knowledge
and belief in full compliance with all applicable laws and regulations, other
than any noncompliance with the rules and regulations promulgated by the Nasdaq
Stock Market regarding the number of independent directors appointed to the
Board that arises as a result of the execution of this Agreement, and none of
them has received any notice or claim of noncompliance with any such law or
regulation.
8. Notices.
Any notices or communication given by any party hereto to the other party shall
be in writing and personally delivered or mailed by registered or certified
mail, return receipt requested, postage prepaid to the following addresses:
If to the Company:
Crumbs Bake Shop, Inc.
c/o Crumbs Holdings LLC
110 West 40th Street
Suite 2100
New York, New York 10018

 

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If to Crumbs:
Crumbs Holdings LLC
110 West 40th Street
Suite 2100
New York, New York 10018
With a copy to:
Ellenoff Grossman & Schole LLP
150 East 42nd Street, 11th Floor
New York, NY 10017
Attn: Douglas Ellenoff, Esq.
If to the Executive:
Julian R. Geiger
7 Chowning Drive
Malvern, Pennsylvania 19355
With copies to:
Julian R. Geiger
2330 Stotesbury Way
Wellington, Florida 33414
and
Julian R. Geiger
40 Central Park South, Apartment 16A
New York, New York 10019.
Mailed notices shall be deemed given when received. Any person entitled to
receive notice may designate in writing, by notice to the other, such other
address to which notices to such party shall thereafter be sent.
9. Indemnification and Insurance; Legal Expenses.
The Companies, jointly and severally, shall indemnify the Executive to the
fullest extent permitted by the laws of the State of Delaware, in accordance
with the terms and conditions of that certain Indemnity Agreement made and
entered into as of November 14, 2011, by and among the Company and Executive.
The Companies and each of them covenant to maintain Directors and Officers
Insurance providing customary benefits to the Executive for the benefit of the
Executive (in his capacity as an officer and director of the Companies or either
of them) during and with respect to the Executive’s employment hereunder.

 

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10. Miscellaneous.
(a) Entire Agreement. This Agreement, together with the Ancillary Documents,
contains the entire understanding of the parties in respect of its subject
matter and supersedes all prior oral and written agreements and understandings
between the parties with respect to such subject matter.
(b) Amendment; Waiver. This Agreement may not be amended, supplemented, canceled
or discharged, except by written instrument executed by the Executive and the
Company and Crumbs. No failure to exercise, and no delay in exercising, any
right, power or privilege hereunder shall operate as a waiver thereof. No waiver
of any preceding breach of this Agreement shall operate as a waiver of a
succeeding breach of this Agreement.
(c) Binding Effect; Assignment. The rights and obligations of the Companies
(individually and jointly) under this Agreement shall bind and inure to the
benefit of any successor or successors of the Companies (individually or
jointly) by reorganization, merger or consolidation, or any assignee of all or
substantially all of the business and properties of the Companies (individually
or jointly); The rights or obligations of the Executive under this Agreement
shall bind and inure to the benefit of the Executive, his heirs and personal
representatives. The Executive’s rights to receive compensation hereunder may be
assigned by the Executive to one or more of his family members or to one or more
trusts for the benefit of such family members. The Executive’s obligations under
this Agreement may not be assigned by the Executive.
(d) Headings. The headings contained in this Agreement (except those in Section
1) are for reference purposes only and shall not affect the meaning or
interpretation of this Agreement.
(e) Governing Law; Interpretation. This Agreement shall be governed and
construed in accordance with the laws of the State of New York, without regard
to conflicts of laws doctrines. Any action, suit, proceeding, claim, dispute or
controversy concerning this Agreement or the subject matter thereof shall be
brought in the courts of the State of New York, in New York County, or in the
federal courts of the United States within the State and County of New York, to
the exclusive jurisdiction of which courts the parties hereto hereby agree. Any
service of process in any such action, suit, proceeding, claim, dispute or
controversy shall be by delivering the same or by mailing the same (by
registered or certified mail, return receipt requested) to the relevant
addresses set forth in Section 8 or to such other addresses as may have been
designated in writing.
(f) Further Assurances. The Companies (individually and jointly) and the
Executive each agree, at any time and from time to time, to execute,
acknowledge, deliver and perform, and/or cause to be executed, acknowledged,
delivered and performed, all such further acts, deeds, assignments, transfers,
conveyances, powers of attorney and/or assurances as may be necessary, and/or
proper to carry out the provisions and/or intent of this Agreement.
(g) Severability. The Companies (individually and jointly) and the Executive
each acknowledge that the terms of this Agreement are fair and reasonable at the
date signed by them. However, in light of the possibility of a change of
conditions or of differing interpretations by a court of what is fair and
reasonable, the Companies (individually and jointly) and the Executive stipulate
as follows: if any one or more of the terms, provisions, covenants and
restrictions of this Agreement shall be determined by a court of competent
jurisdiction to be invalid, void or unenforceable, 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, impaired or invalidated;
further, if any one or more of the provisions contained in this Agreement shall
for any reason be determined by a court of competent jurisdiction to be
excessively broad as to duration, geographical scope, activity or subject, it
shall be construed, by limiting or reducing it, so as to be enforceable to the
extent compatible with then applicable law.

 

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(h) Section 409A. Notwithstanding anything herein to the contrary,
(i) The parties agree that this Agreement shall be interpreted to comply with or
be exempt from Section 409A of the Code and the regulations and guidance
promulgated thereunder to the extent applicable (collectively “Code
Section 409A”), and all provisions of this Agreement shall be construed in a
manner consistent with the requirements for avoiding taxes or penalties under
Code Section 409A.
(ii) A termination of employment shall not be deemed to have occurred for
purposes of any provision of this Agreement providing for the payment of any
amounts or benefits considered “nonqualified deferred compensation” under Code
Section 409A upon or following a termination of employment unless such
termination is also a “separation from service” within the meaning of Code
Section 409A and, for purposes of any such provision of this Agreement,
references to a “termination,” “termination of employment” or like terms shall
mean “separation from service.” If Executive is deemed on the date of
termination to be a “specified employee” within the meaning of that term under
Code Section 409A(a)(2)(B), then with regard to any payment or the provision of
any benefit that is considered nonqualified deferred compensation under Code
Section 409A payable on account of a “separation from service,” such payment or
benefit shall be made or provided at the date which is the earlier of (i) the
expiration of the six (6)-month period measured from the date of such
“separation from service” of Executive, and (ii) the date of Executive’s death
(the “Delay Period”). Upon the expiration of the Delay Period, all payments and
benefits delayed pursuant to this Section 10(h)(ii) (whether they would have
otherwise been payable in a single sum or in installments in the absence of such
delay) shall be paid or reimbursed on the first business day following the
expiration of the Delay Period to Executive in a lump sum with interest during
the Delay Period at the prime rate, and any remaining payments and benefits due
under this Agreement shall be paid or provided in accordance with the normal
payment dates specified for them herein.
(iii) With regard to any provision herein that provides for reimbursement of
costs and expenses or in-kind benefits, except as permitted by Code
Section 409A, (x) the right to reimbursement or in-kind benefits shall not be
subject to liquidation or exchange for another benefit, (y) the amount of
expenses eligible for reimbursement, or in-kind benefits, provided during any
taxable year shall not affect the expenses eligible for reimbursement, or
in-kind benefits, to be provided in any other taxable year; provided, that this
clause (y) shall not be violated with regard to expenses reimbursed under any
arrangement covered by Internal Revenue Code Section 105(b) solely because such
expenses are subject to a limit related to the period the arrangement is in
effect and (z) such payments shall be made on or before the last day of
Executive’s taxable year following the taxable year in which the expense
occurred.

 

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(iv) For purposes of Code Section 409A, Executive’s right to receive any
installment payments pursuant to this Agreement shall be treated as a right to
receive a series of separate and distinct payments. Whenever a payment under
this Agreement specifies a payment period with reference to a number of days
(e.g., “payment shall be made within thirty (30) days following the date of
termination”), the actual date of payment within the specified period shall be
within the sole discretion of the Company.
(i) Legal Fees. The Company shall pay all reasonable attorney’s fees and
disbursements incurred by the Executive in connection with the negotiation of
this Agreement and related documents.
(j) Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, and all of which taken together shall
constitute a single agreement.
[Remainder of Page Intentionally Left Blank]

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement the date and
year first above written.

                  CRUMBS BAKE SHOP, INC.    
 
           
 
  By:   /s/ John D. Ireland
 
Name: John D. Ireland    
 
      Title: CFO    
 
                CRUMBS HOLDINGS LLC    
 
           
 
  By:   /s/ John D. Ireland
 
Name: John D. Ireland    
 
      Title: CFO    
 
                EXECUTIVE:    
 
                /s/ Julian R. Geiger                   Julian R. Geiger    

[SIGNATURE PAGE TO GEIGER EMPLOYMENT AGREEMENT]