Employment Agreement - Deborah S Stehr

Exhibit 10.11

    Employment
      Agreement

     

    Employment
      Agreement, dated as of October 28, 2005, by and between Iconix Brand Group,
      Inc., a Delaware corporation (the “Company” or “Employer”) and Deborah Sorell
      Stehr (the “Executive”).

     

    W
      I T
      N E S S E T H

     

    WHEREAS,
      the Executive is currently the Company’s Senior Vice President and General
      Counsel; and

     

    WHEREAS,
      the Company and Executive entered into a two-year Employment Agreement dated
      as
      of February 1, 2004 (the “Original Agreement”); and

     

    WHEREAS,
      the Company wishes, among other things, to continue the Executive’s employment
      with the Company beyond the term currently provided by the Original Agreement
      pursuant to the terms as provided herein;

     

    NOW,
      THEREFORE, in consideration of the mutual covenants and agreements hereinafter
      set forth, and for other good and valuable consideration, the receipt and
      sufficiency of which is hereby acknowledged, the Employer and Executive hereby
      agree as follows:

     

    1.  Term.
      The
      Company hereby agrees to employ the Executive for a period commencing on the
      date hereof and ending on December 31, 2007 (the “Term”).

     

    2.  Title;
      Duties.
      The
      Executive shall render services to the Company as chief counsel to the Company
      in the position of Senior Vice President - General Counsel. Executive's duties
      and responsibilities shall be consistent with the duties undertaken by the
      senior legal officer of a corporation. Executive may work four days a week
      so
      long as there is no material interruption of her services. Executive shall
      report directly to Neil Cole.

     

    3.  Compensation.

     

    (a)  Base
      Salary.
      Executive's base salary for the First Year (as defined below) will be at the
      current rate of $215,000 until January 1, 2006, at which time it shall increase
      to not less than $220,000 per annum paid in accordance with the Company’s
      payroll practices and policies. Executive's base salary for the Second Year
      (as
      defined below) will be at a rate of not less that $230,000 per annum paid in
      accordance with the Company’s payroll practices and policies. For the purposes
      of this Agreement, the “First Year” shall mean the period through December 31,
      2006 and the “Second Year” shall mean the period January 1, 2007 through
      December 31, 2007.

     

    (b)  Bonus.
      Executive will be eligible for a bonus consistent with other executive officers
      pursuant to the Company’s executive bonus program.

     

    (c)  The
      Company shall pay to Executive a monthly car allowance of $1,500.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (d)  In
      connection with this Agreement, the Company will grant to the Executive 60,000
      options to purchase the common stock of the Company vesting
      immediately.

     

    4.  Other
      Benefits and Expenses.

     

    (a)  Executive
      shall be permitted during the Term to participate (without any waiting periods)
      in any and all benefit plans, hospitalization, medical, health, disability,
      officer/director or employee liability insurance plans, pension and 401K plans
      or other benefit plans (including any to-be-established bonus plans) on the
      same
      terms and conditions as extended to other executive officers of the
      Company.

     

    (b)  The
      Company shall promptly reimburse Executive for all reasonable and necessary
      travel and entertainment expenses and other disbursements or costs Executive
      may
      incur in connection with promoting the business of the Company.

     

    (c)  Executive
      shall be entitled to four weeks of paid vacation per year. If, in any year,
      Executive does not take some or all of her vacation, such unused days will
      be
      banked and carried over into the next year, as may be applicable.

     

    5.  Establishment
      and Operation of Legal Department.
      

     

    (a)  Executive
      shall be entitled to a full-time dedicated secretary or assistant.

     

    (b)  Executive
      shall be permitted to attend such professional conferences, receive such
      professional publications, acquire such professional books and materials to
      build a library, and receive such other facilities and support as are reasonable
      and necessary to establish a legal department and perform her duties
      hereunder.

     

    (c)  Executive
      shall be provided with all reasonable and necessary facilities and equipment
      to
      carry out her duties, including but not limited to a laptop computer, cellular
      phone and home fax machine.

     

    6.  Termination.

     

    (a)  Executive's
      employment may be terminated by the Company prior to the expiration of the
      Term
      of this Agreement only for “Cause” by giving Executive prior written notice of
      the basis for the proposed termination and a reasonable chance to cure. As
      used
      in this agreement, the term “Cause” shall mean: (a) Executive's willful and
      continuing malfeasance and failure to perform having a material adverse effect
      on the Company; (b) Executive's willful engagement in fraud or dishonesty
      against the Company having a material adverse effect on the Company; or (c)
      Executive's conviction of a felony involving moral turpitude.

     

    (b)  Executive
      may terminate this Agreement at any time for “Good Reason” by giving the Company
      prior written notice of the basis for the proposed termination and a reasonable
      chance to cure. “Good Reason” shall mean any of the following: (i) a breach by
      the Company of any of its payment obligations to Executive hereunder; (ii)
      relocation of the Company outside a 50-mile radius of New York City unless
      the
      Company shall provide Executive with a suitable location from which to work
      within such radius; (iii) a proposed material modification or reduction of
      Executive's duties or position as chief counsel; (iv) the bankruptcy,
      reorganization or liquidation of the Company; or (v) a failure of any successor
      corporation to the Company to assume the obligations under this
      Agreement.

     

    
      
        
        

      

      
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    7.  Effect
      of Termination.
      

     

    (a)  Upon
      termination of Executive’s employment for Cause (or upon Executive’s death or
      disability rendering her unable to perform), Executive (or Executive’s heirs and
      representatives) shall receive any accrued salary, pro-rated bonus and vacation
      due through the date of termination and be reimbursed for any outstanding
      business expenses (including those relating to Executive’s car) incurred prior
      to the date of termination. Executive (or Executive’s heirs or representatives,
      if applicable) shall also be entitled to continuation of health and medical
      benefits for 3 months from the date of termination.

     

    (b)  If
      the
      Company terminates Executive’s employment without Cause or Executive terminates
      Executive’s employment for Good Reason within 12 months after a Change in
      Control (as defined in Subsection 7(d)), then the Company shall pay to Executive
      in complete satisfaction of its obligations under this Agreement, as severance
      pay and as liquidated damages (because actual damages are difficult to
      ascertain), in a lump sum, in cash, within 15 days after the date of Executive’s
      termination, an amount equal to $100 less than three times Executive’s
“annualized includable compensation for the base period” (as defined in Section
      280G of the Internal Revenue Code of 1986); provided,
      however,
      that if
      such lump sum severance payment, either alone or together with other payments
      or
      benefits, either cash or non-cash, that Executive has the right to receive
      from
      the Company, including, but not limited to, accelerated vesting or payment
      of
      any deferred compensation, options, stock appreciation rights or any benefits
      payable to Executive under any plan for the benefit of employees, which would
      constitute an “excess parachute payment” (as defined in Section 280G of the
      Internal Revenue Code of 1986), then such lump sum severance payment or other
      benefit shall be reduced to the largest amount that will not result in receipt
      by Executive of a parachute payment. The determination of the amount of the
      payment described in this subsection shall be made by the Company’s independent
      auditors at the sole expense of the Company. For purposes of clarification
      the
      value of any options described above will be determined by the Company’s
      independent auditors using a Black-Scholes valuation methodology.

     

    (c)  If
      within
      12 months after the occurrence of a Change of Control, the Company shall
      terminate Executive’s employment without Cause or Executive terminates
      Executive’s employment for Good Reason, then notwithstanding the vesting and
      exercisability schedule in any stock option agreement between the Company and
      Executive, all unvested stock options granted by the Company to Executive
      pursuant to such agreement shall immediately vest and become exercisable and
      shall remain exercisable for not less than 180 days thereafter.

     

    (d)  A
“Change
      in Control” shall mean any of the following:

     

    (1)  any
      consolidation or merger of the Company in which the Company is not the
      continuing or surviving corporation or pursuant to which shares of the Company’s
      common stock would be converted into cash, securities or other property, other
      than a merger of the Company in which the holders of the Company common stock
      immediately prior to the merger have the same proportionate ownership of common
      stock of the surviving corporation immediately after the merger;

     

    
      
        
        

      

      
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    (2)  any
      sale,
      lease, exchange or other transfer (in one transaction or a series of related
      transactions) of all or substantially all of the assets of the
      Company;

     

    (3)  any
      approval by the stockholders of the Company of any plan or proposal for the
      liquidation or dissolution of the Company; 

     

    (4)  the
      cessation of control (by virtue of their not constituting a majority of
      directors) of the Company’s Board of Directors by the individuals (the
“Continuing Directors”) who (x) at the date of this Agreement were directors or
      (y) become directors after the date of this Agreement and whose election or
      nomination for election by the Company’s stockholders, was approved by a vote of
      at least two-thirds of the directors then in office who were directors at the
      date of this Agreement or whose election or nomination for election was
      previously so approved); or

     

    (5)  (A)
      the
      acquisition of beneficial ownership (“Beneficial Ownership”), within the meaning
      of Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), of an aggregate of 25% or more of the voting power of the
      Company’s outstanding voting securities by any person or group (as such term is
      used in Rule 13d-5 under the Exchange Act) who beneficially owned less than
      10%
      of the voting power of the Company’s outstanding voting securities on the
      effective date of this Agreement, (B) the acquisition of Beneficial Ownership
      of
      an additional 15% of the voting power of the Company’s outstanding voting
      securities by any person or group who beneficially owned at least 10% of the
      voting power of the Company’s outstanding voting securities on the effective
      date of this agreement, or (C) the execution by the Company and a stockholder
      of
      a contract that by its terms grants such stockholder (in its, hers or his
      capacity as a stockholder) or such stockholder’s Affiliate (as defined in Rule
      405 promulgated under the Securities Act of 1933 (an “Affiliate”)) including,
      without limitation, such stockholder’s nominee to the Company’s Board of
      Directors (in its, hers or his capacity as an Affiliate of such stockholders),
      the right to veto or block decisions or actions of the Company’s Board of
      Directors’ provided however,
      that
      notwithstanding the foregoing, the events described in items (A), (B) or (C)
      above shall not constitute a Change in Control hereunder if the acquiror is
      (aa)
      a trustee or other fiduciary holding securities under an employee benefit plan
      of the Company or one of its affiliated entities and acting in such capacity,
      (bb) a corporation owned, directly or indirectly, by the stockholders of the
      Company in substantially the same proportions as their ownership of voting
      securities of the Company or (cc) a person or group meeting the requirements
      of
      clauses (ii) and (ii) of Rule 13d-1(b)(1) under the Exchange Act; 

     

    (6)  subject
      to applicable law, in a Chapter 11 bankruptcy proceeding, the appointment of
      a
      trustee or the conversion of a case involving the Company to a case under
      Chapter 7.

     

    
      
        
        

      

      
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    (e)  Executive
      shall not be required to mitigate the amount of any payment provided for in
      this
      Section 7 by seeking other employment or otherwise, nor shall the amount of
      any
      payment provided for in this Section 7 be reduced by any compensation earned
      by
      Executive as the result of Executive’s employment by another employer or
      business or by profits earned by Executive from any other source at any time
      before and after Executive date of termination.

     

    8.  Indemnification.
      The
      Employer shall indemnify and hold harmless the Executive against any and all
      expenses reasonably incurred by her in connection with or arising out of (a)
      the
      defense of any action, suit or proceeding in which she is a party, or (b) any
      claim asserted or threatened against her, in either case by reason of or
      relating to her being or having been an employee, officer or director of the
      Company, whether or not she continues to be such an employee, officer or
      director at the time of incurring such expenses, except insofar as such
      indemnification is prohibited by law. Such expenses shall include, without
      limitation, the fees and disbursements of attorneys, amounts of judgments and
      amounts of any settlements, provided that such expenses are agreed to in advance
      by the Employer. The foregoing indemnification obligation is independent of
      any
      similar obligation provided in the Employer’s Certificate of Incorporation or
      Bylaws, and shall apply with respect to any matters attributable to periods
      prior to the Effective Date, and to matters attributable to Executive's
      employment hereunder, without regard to when asserted.

     

    9.  Miscellaneous.
      

     

    (a)  This
      Agreement shall be governed by the laws of the State of New York and each Party
      agrees that in the event of a dispute relating to the terms hereof the other
      will submit to the exclusive jurisdiction of the state or federal courts sitting
      within the City of New York.

     

    (b)  If
      not
      terminated in accordance with its terms, this Agreement shall be binding upon,
      and inure to the benefit of, the Parties, their heirs, legal representatives,
      successors and permitted assigns.

     

    (c)  The
      invalidity or unenforceability of any provision hereof shall not in any way
      affect the validity or enforceability of any other provision. This Agreement
      reflects the entire understanding between the Parties.

     

    (d)  This
      Agreement supersedes any and all other agreements, either oral or in writing,
      between the parties hereto with respect to the employment of the Executive
      by
      the Employer and contains all of the covenants and agreements between the
      parties with respect to such employment in any manner whatsoever. Any
      modification or termination of this Agreement will be effective only if it
      is in
      writing signed by the party to be charged.

     

    (e)  This
      Agreement may be executed by the parties in one or more counterparts, each
      of
      which shall be deemed to be an original but all of which taken together shall
      constitute one and the same agreement, and shall become effective when one
      or
      more counterparts has been signed by each of the parties hereto and delivered
      to
      each of the other parties hereto.

     

    
      
        
        

      

      
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    10.  Notices.
      All
      notices relating to this Agreement shall be in writing and shall be either
      personally delivered, sent by telecopy (receipt confirmed) or mailed by
      certified mail, return receipt requested, to be delivered at such address as
      is
      indicated below, or at such other address or to the attention of such other
      person as the recipient has specified by prior written notice to the sending
      party. Notice shall be effective when so personally delivered, one business
      day
      after being sent by telecopy or five days after being mailed.

     

    To
      the
      Employer:

    


    Iconix
      Brand Group, Inc. 

    1450
      Broadway, 4th
      Floor

    New
      York,
      NY 10018 

    Attention:
      Neil Cole, Chief Executive Officer

    


    With
      a
      copy in the same manner to:

    


    Blank
      Rome LLP

    405
      Lexington Avenue

    New
      York,
      New York 10174

    Attention:
      Robert J. Mittman, Esq.

    


    To
      the
      Executive:

    


    Deborah
      Sorell Stehr

    27
      Hamilton Drive West

    North
      Caldwell, NJ 07006

    


    IN
      WITNESS WHEREOF, the parties hereto have executed this agreement as of the
      date
      above written.

     

    ICONIX
      BRAND GROUP, INC.

    


    


    By:     
      /s/ Neil Cole      

    Neil
      Cole,

    Chief
      Executive Officer

    


                                 
/s/
      Deborah
      Sorell Stehr

    Deborah
      Sorell Stehr

    
       

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