Exhibit
10.10


 


	
  

  



 


April 19, 2002


 


 


Mr. Jeffrey L. Grayson


220 West 98th, Apt 9L


New York, NY 10025


 


Dear Jeff:


 


It is my pleasure
to extend to you an offer for the position of Chief Technology Officer for
Equinox Holdings, Inc., the consolidated business of Equinox Fitness Clubs
comprising all of the businesses that carry the “Equinox” brand name including
the fitness clubs, management company and related products or businesses (the
“Company”). As Chief Technology Officer, you will report directly to the Chief
Financial Officer of the Company and will have duties consistent with the job
description. The position offered is full-time employment at our corporate
headquarters in  New York City,
beginning May 8, 2002.


 


Your employment is
subject to your execution of Equinox’s Non-Disclosure and Non-Competition
Agreement for senior executives, a copy of which is attached. Initially, your
annual base salary will be $150,000, payable in biweekly installments.  Effective January 1, 2003, your annual base
salary will increase to $160,000. As additional compensation, you are eligible
to receive an annual performance incentive as described more fully in
Attachment 1 to this letter.  As an
inducement to accept this offer of employment, the Company will pay you a
special $5,000 bonus on November 1, 2002 and grant you options to purchase up
to 10,000 shares of the common stock of the Company at an exercise price equal
to the Fair Market Value at December 31, 2001, as described more fully in a
separate option agreement. Your compensation will be reviewed annually by the
Compensation Committee of the Board of Directors and may be increased but not
decreased.


 


Single health
insurance and group term life insurance (in an amount equal to your base
salary) coverage under our executive benefits program through PHS/The Guardian
will be effective after ninety days of full-time employment. After you have
completed six months of employment, you are entitled to two weeks’ paid
vacation and you are eligible to participate in the Company’s 40l(k) plan with
a 25% match by the Company. You are also entitled to one complimentary
membership during your first year of employment and three memberships
thereafter.


 


 


	
  895 broadway

  	
   

  	
   

  	
   

  	
  new york, new york 10003

  	
   

  	
   

  	
   

  	
  tel 212.677.0180

  	
   

  	
   

  	
   

  	
  fax 212.777.9510

  



 


www.equinoxfitness.com


 
















 


If the terms of
this offer letter are acceptable to you, please indicate your agreement by
countersigning both originals of this letter and the Non-Disclosure and
Non-Competition Agreement, returning one copy of each to me. On behalf of the
Board of Directors and the employees of Equinox, I wish to express my
excitement at the prospect of your joining us.


 


	
   

  	
  Sincerely
  yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Harvey Spevak

  	
   

  
	
   

  	
  Harvey Spevak

  
	
   

  	
   

  
	
  Agreed
  and Accepted:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/
  Jeffrey L. Grayson

  	
   

  	
   

  
	
  Jeffrey
  L. Grayson

  	
   

  
				



 
















 


Attachment 1


Performance
Bonus Plan


Chief Technology Officer


 


 


1.                                       The
performance bonus will be based upon (i) certain individual deliverables to  be mutually agreed within the first
ninety (90) days of your employment, and (ii) the Company’s earnings before
interest expense, income taxes and depreciation and amortization (“EBITDA”)
during any fiscal year.


 


2.                                       Individual Deliverables Upon your
achievement of certain mutually agreed deliverables in 2002, you will be
eligible to receive a performance incentive up to $10,000.  For 2003, the bonus opportunity will increase
to $20,000. This individual performance incentive is contingent upon the
Company achieving 90% of its profitability goal (see paragraph 4).


 


3.                                       Corporate EBITDA On an annual basis, the
actual EBITDA during the given fiscal year (as confirmed by the Company’s
outside auditors) will be compared with the amount of EBITDA forecast to be
generated during such period as outlined in the approved operating budget.


 


a.               If the
actual EBITDA is less than, 90% of goal, no performance bonus will be awarded.


 


b.              If the
actual 2002 EBITDA is equal to or greater than 90% of goal but less than 95% of
goal, a performance bonus in the amount of $4,000 will be awarded. For 2003,
the bonus opportunity will increase to $8,000.


 


c.               If the
2002 actual EBITDA is equal to or greater than 95% of goal but less than 100%
of goal, a performance bonus incentive in the amount of $6,000 plus $800 for
each one percent (1%) in excess of 95% of goal, subject to a maximum
performance bonus of $10,000 will be awarded. For 2003, the 95% and incremental
bonus opportunities increase to $12,000 and $1,600, respectively.


 


d.              If the
actual EBITDA is  greater than 100% of
goal, a performance bonus in the amount of $10,000 plus $2,000 for each one
percent (1%) in excess of 100% of goal be awarded. For 2003, the 100% and
incremental bonus opportunities will increase to $20,000 and $4,000,
respectively.


 


4.                                       If
actual Corporate EBITDA is less than 90% of goal, no individual performance
bonus will be awarded.


 


5.                                       Performance
incentive bonuses will be paid no later than April 10th of the
following year.


 
















 


	
  

  



 


May 8, 2002


 


 


Mr.
Jeffrey L. Grayson


220
West 98th, Apt 9L


New
York, NY 10025


 


Re:    Non-Disclosure and Non-Competition
Agreement


 


Dear Jeff:


 


This will confirm
the terms of the agreement between Equinox Holdings, Inc. with offices at 895
Broadway, New York, New York (“Equinox”) and Mr. Jeffrey L.  Grayson (“You”) regarding the protection
of Confidential Information and certain restrictions on Your competing with
Equinox.


 


1.                                       GENERAL


 


Equinox agrees to
employ You, and You agree to be employed by Equinox as Chief Technology Officer
for Equinox’s consolidated businesses pursuant to the terms and provisions of
the offer letter dated April 19, 2002 (the “Offer Letter”).  Your employment relationship with Equinox
will be on an “at will” basis, and either Equinox or You may  terminate the employment for any reason
and at any time, without notice.


 


2.                                       WORKS
FOR HIRE


 


You agree that all
work products including, but not limited to, patents, copyrights, product
developments, service developments, ideas and concepts created by You during
Your employment and which relate to the business of Equinox shall remain the
exclusive property of Equinox.


 


3.                                       CONFIDENTIALITY
AGREEMENT AND RESTRICTIVE CONVENANTS


 


(a)           You recognize and acknowledge that
the lists and files relating to Equinox’s members, prospects, employees,
independent contractors and suppliers as well as its business plans, policies,
operating procedures and financial information (including operating budgets)
concerning Equinox or its shareholders and affiliates (collectively,
“Confidential Information”), as same may exist from time to time, are valuable,
special and unique assets of Equinox’s business.  You agree that, except as required by law,
You will not disclose Confidential Information to any person, firm,
corporation, association or other entity for any reason or any


 


	
  895 broadway

  	
   

  	
   

  	
   

  	
  new york, new york 10003

  	
   

  	
   

  	
   

  	
  tel 212.677.0180

  	
   

  	
   

  	
   

  	
  fax 212.777.9510

  



 


www.equinoxfitness.com


 
















 


purpose at all and that You will not use such Confidential Information
for Your own benefit or the benefit of any third party(s). You also agree that
all equipment, records, files, memoranda, computer printouts and data, reports,
correspondence and the like, relating to the business of Equinox, that You
might use or prepare or with which You might come into contact, shall remain
the sole property of Equinox. You further agree to turn over immediately to Equinox
any such material in Your possession at such time as Your employment is
terminated.


 


(b)           You agree that, during Your
employment and for a period of twelve (12) months
immediately following termination of Your employment, You will not, without
Equinox’s prior written consent, directly or indirectly, own, manage, be
employed by, operate, consult for or participate in, or be connected as an
officer, employee, partner, or otherwise with any  fitness club within a twelve (12) block radius of Equinox
or any of its affiliates’ facilities; provided however that, in the event that
Your employment is terminated by Equinox without cause, the period of time of
your non-compete will be the same as the equivalent number of months during
which You receive severance pay as described more fully in paragraph 3(c).
Notwithstanding the foregoing, the parties agree that You will be released from
the terms of the preceding non-compete provision in the event that Equinox
fails to fulfill any of its financial obligations under the Offer Letter or
this letter agreement. You also agree that, during Your employment and for a
period of eighteen (18) months immediately following termination of Your
employment. You will not in any  manner,
directly or indirectly, disparage Equinox or its employees and operations in
any way. You further agree that, during Your employment and for a period of
eighteen (18) months immediately following termination of Your employment, You
will not in any  manner, directly
or indirectly, encourage, Induce or attempt to induce any person who is then or
was (within six (6) months before the date of such Inducement) an employee or
consultant of Equinox to alter or terminate his or her employment or
consultation with Equinox or otherwise solicit, attempt to hire or hire any
such employee or consultant. If the period of time or area herein specified
should be adjudged unreasonable in any court proceeding, then the period of
time shall be reduced by such number of months or the area shall be reduced
geographically, of both, so that this covenant may be enforced during such
period of time and in such areas as are adjudged to be reasonable.


 


(c)           Equinox agrees that, in the event
that Your employment is terminated by Equinox, You will be entitled to receive
severance pay equal to the equivalent of one week’s salary for each six months
of service to Equinox at the time of termination, payable at the option of
Equinox, either in one lump sum or in biweekly installments of no less the
equivalent biweekly installment of Your effective base salary at the time of
termination. The amount of such severance pay shall be no more than one-half of
Your effective base salary at the time of termination, less any applicable
deductions as required by law. In the event that You are terminated for cause,
Equinox is not obligated to make any severance payment. For the purposes of
this Agreement, “cause” shall be deemed to exist if:


 


(i)        You
are terminated for embezzlement of corporate funds;


(ii)       You
enter a business or employment that Equinox reasonably determines to be
detrimentally competitive with the business of Equinox and substantially
injurious to the financial interests of Equinox;


(iii)      You
willfully refuse to perform services consistent with Your position;


 
















 


(iv)     You
engage in acts of dishonesty or fraud  in
connection with Your employment; or 


(v)      You
engage in acts of misconduct of such nature that Your continued employment
could reasonably be expected to adversely affect the business or properties of
Equinox.


 


For the purposes of determining “cause” in subparagraph 3(c)(iii) and
3(c)(v) above, You will have thirty (30) days, after written notice from
Equinox’s Board of Directors, to remedy the reason(s) given by the Board in
such notice for the assertion of a “cause” event. If You fail to remedy the
reason(s) within such thirty (30) day period, Equinox may terminate You for
cause.


 


(d)           You agree that, upon a breach,
threatened breach or violation by You of any of the foregoing provisions of
this paragraph 3, Equinox, in addition to all other remedies, shall be entitled
as a matter of right to injunctive relief in any court of competent
jurisdiction without being required to post bond or other security and without
having to prove the inadequacy of the available remedies at law, to enjoin and
restrain You and each and every other person, partnership, association,
corporation or organization concerned therein, from the continuance of any
action constituting such breach.


 


4.             NOTICES


 


Any and all
notices or other communications given under this Agreement shall be in writing
and shall be deemed to have been duly given on the date of delivery, if
delivered in person, or four (4) days after mailing, if mailed within the
continental United States, postage prepaid, by certified or registered mail,
return receipt requested, to the party entitled to receive the same at his or
its address first set forth above. We may designate by notice to each other any
new address for the purposes of this Agreement as provided in this paragraph 4.


 


5.             MISCELLANEOUS
PROVISIONS


 


(a)           This instrument, in conjunction with
the Offer Letter, represents the entire Agreement between us and supersedes any
prior agreement or understanding with respect to the subject matter hereof. In
the event that a conflict arises between this Agreement and the Offer Letter,
the Offer Letter will govern. No provision hereof may be amended, modified,
terminated or revoked except by a writing signed by both of us.


 


(b)           This Agreement will be governed by,
and construed and enforced according to, the laws of the State of New York
without regard to its conflicts of  law
rules.


 


(c)           No waiver of any breach or default hereunder shall be
considered valid unless in writing, and no such waiver shall be deemed the
waiver of subsequent breach or default of the same or similar nature.


 


(d)           If any provision of this Agreement shall be held invalid
or unenforceable, such invalidity or unenforceability shall affect only such
provision and shall not in any manner affect


 
















 


or render invalid or unenforceable any other severable provision of
this Agreement, and this Agreement shall be carried out as if any such invalid
or unenforceable provision were not contained herein.


 


(e)           We agree that we will each take such
action and execute and deliver such documents as may be reasonably necessary to
fulfill the terms of this Agreement.


 


(f)            The agreements and covenants set forth in Paragraph 3
above shall survive termination and expiration of this Agreement for the
various time periods specified therein.


 


If this letter accurately
sets  forth the terms of our
agreement, please countersign the enclosed copy and return it to us.


 


 


	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
  EQUINOX
  HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
  /s/ Harvey Spevak

  	
   

  
	
   

  	
  Harvey Spevak

  
	
   

  	
   

  
	
  Accepted
  and Agreed to this

  	
   

  
	
  8
  day of May, 2002

  	
   

  
	
   

  	
   

  
	
  /s/
  Jeffrey L. Grayson

  	
   

  	
   

  
	
  Jeffrey
  L. Grayson