Document:

EXHIBIT 10.2

 

PIERRE
FOODS, INC.

 

FISCAL
2007

 

EXECUTIVE
INCENTIVE COMPENSATION PLAN

 

1.                                      PURPOSE OF THE
PLAN.

 

The purpose of the Pierre Foods, Inc. Fiscal 2007
Executive Incentive Compensation Plan is to provide certain executives of
Pierre Foods, Inc. with incentive compensation based upon the achievement of
financial, business and other performance criteria.  The Plan is an annual Plan with quarterly
partial interim bonus payments.

 

2.                                      DEFINITIONS.

 

The following capitalized terms used in the Plan have
the respective meanings set forth in this Section:

 

(a)                                  “Award” means a cash bonus award granted
pursuant to the Plan.

 

(b)                                 “Board” means the Board of Directors of the
Company.

 

(c)                                  “Code” means the Internal Revenue Code of
1986, as amended, or any successor thereto.

 

(d)                                 “Committee” means the Compensation
Committee of the Board, or any successor thereto or any other committee
designated by the Board to assume the obligations of the Committee hereunder.

 

(e)                                  “Company” means Pierre Foods, Inc., a North
Carolina corporation.

 

(f)                                    “Direct Contribution” means net sales less
standard cost of goods sold, less direct expenses, including but not limited
to, freight and selling expenses, based upon the Company’s financial
statements, as determined by the Committee with respect to Awards to the
President and CEO, or by the Committee together with the President and CEO in
all other cases.

 

(g)                                 “EBITDA” means earnings before interest,
taxes, depreciation and amortization, based upon the Company’s financial
statements, as determined by the Committee with respect to Awards to the
President and CEO or by the Committee together with the President and CEO in
all other cases.

 

(h)                                 “Effective Date” means the date on which
the Plan takes effect in accordance with Section 12 of the Plan.

 

(i)                                     “Estimated Award” has the meaning ascribed
to it in Section 5(c).

 

(j)                                     “Fiscal 2007” means the Company’s fiscal
year ending March 3, 2007.

 

(k)                                  “Maximum Award” means the maximum Award
which a Participant can earn pursuant to the Plan as set forth on Schedule I.

 

(l)                                     “Participant” means the President and CEO
and such other executives of the Company who are selected by the Committee
together with the President and CEO to participate in the Plan pursuant to
Section 4 of the Plan.

 

(m)                               “Performance Period” means Fiscal 2007.

 

(n)                                 “Plan” means the Pierre Foods, Inc. Fiscal
2007 Executive Incentive Compensation Plan.

 

 

(o)                                 “President and CEO” means the President and
Chief Executive Officer of the Company.

 

3.                                      ADMINISTRATION.

 

The Plan shall be administered by the Committee for
purposes of any Award granted to the President and CEO.  For all other Awards, the Plan shall be
administered by the President and CEO with oversight by the Committee.  The President and CEO shall be a Participant
in the Plan and shall have the authority to select the other executives to be
granted Awards under the Plan.  The
Committee, with respect to the President and CEO, and the Committee together
with the President and CEO with respect to all other Participants, shall have the
authority to determine the size and terms of Awards (subject to the limitations
imposed on Awards in Section 5 below), to modify the terms of any Award that
has been granted, to determine the time when Awards will be made, the amount of
any payments pursuant to such Awards, and the Performance Period to which they
relate, to establish performance objectives in respect of such Performance
Periods and to determine whether such performance objectives were
attained.  The Committee with respect to
the President and CEO, and the Committee together with the President and CEO
with respect to all other Participants, is authorized to interpret the Plan, to
establish, amend and rescind any rules and regulations relating to the Plan,
and to make any other determinations that it deems necessary or desirable for
the administration of the Plan.  Any
decision of the Committee or the President and CEO, in their respective roles
as administrators of the Plan, in the interpretation and administration of the
Plan, as described herein, shall lie within their sole and absolute discretion
and shall be final, conclusive and binding on all parties concerned.  Determinations made by the Committee or the
Committee together with the President and CEO under the Plan need not be
uniform and may be made selectively among Participants, whether or not such
Participants are similarly situated.

 

4.                                      ELIGIBILITY
AND PARTICIPATION.

 

(a)                                  Participants.  The President and CEO shall be a Participant
in the Plan, and shall select the other executives who shall be Participants
for the Performance Period.  Participants
shall be selected from among the employees of the Company and the designation
of Participants may be made individually or by groups or classifications of
employees, as the Committee together with the President and CEO deem
appropriate.

 

(b)                                 New
Hires; Promotions.  If an employee other
than the President and CEO becomes a Participant after the commencement of the
Performance Period, the Committee together with the President and CEO, in their
sole discretion, shall determine the date on which the Participant will be
entitled to participate in the Plan, the performance objectives, amount of
Award and other terms applicable to such Participant.  New employees (who are determined to be
Participants by the Committee together with the President and CEO) shall be
eligible to participate in the Plan in the first full fiscal quarter of his or
her employment.  If a Participant is
transferred or promoted before the end of the Performance Period, the Committee
together with the President and CEO, in their sole discretion, shall determine
whether such Participant shall be entitled to continue to participate in the
Plan, and if so, the performance objectives, amount of Award and other terms
and conditions applicable to such Participant. 
Unless otherwise specifically determined by the Committee together with
the President and CEO, any Participant who is promoted during the Participation
Period shall continue under the Plan as if he or she was not promoted.

 

5.                                      AWARDS.

 

(a)                                  Performance
Objectives.  Awards under the Plan shall
be conditioned on the attainment of written performance objectives.  Performance objectives and Awards shall be
recommended by the President and CEO and determined and approved by the Committee
for the Performance Period and may include, among other things, objectives
relating to EBITDA and Direct Contribution. 
The Committee, with respect to Awards to the President and CEO, and
based upon the recommendation by the President and CEO in all other cases,
shall determine whether and to what extent each performance objective has been
met.  In determining whether and to what
extent a performance objective has been met, the Committee or the Committee
together with the President and CEO, as applicable, may consider such matters
as they deem appropriate.

 

(b)                                 Amount
Payable.  The amount payable pursuant to
an Award shall be determined by the Committee (upon recommendation by the
President and CEO for all Awards other than Awards to the President and

 

 

CEO) in its sole
discretion based on the applicable performance objectives and their
determination of whether and to what extent each applicable performance
objective has been met; provided, however, that in no event shall a Participant
be paid more than the Maximum Award applicable to such Participant.  Unless otherwise specifically determined by
the Committee together with the President and CEO with respect to a
Participant, Awards for the Performance Period shall be based upon a
Participant’s salary at the commencement of the Performance Period.

 

(c)                                  Payment.  As soon as practicable after the end of each
fiscal quarter during the Performance Period, the Company shall estimate the
total Award for the Performance Period that will be payable to each Participant
based upon (i) the actual performance of the Company through the end of such
fiscal quarter and (ii) the projected performance of the Company for the
remainder of the Performance Period (the “Estimated
Award”).  Subject to the terms
and conditions of the Plan, for each of the first three fiscal quarters during
the Performance Period, the Company shall pay each Participant an amount equal
to one-fourth (1/4) of seventy-five percent (75%) of the total Estimated Award
for such Participant.  The final payment
of the Award shall include the total Award for the Performance Period less any
payments made for each of the first three fiscal quarters during the
Performance Period.  The final payment is
not payable to a Participant if the Participant ceases to be a Participant at
any time prior to the end of the Performance Period.  Following the completion of the annual audit
of the Company’s financial statements and the filing of such financial
statements with the Securities and Exchange Commission, subject to the terms
and conditions of the Plan, a fourth and final payment shall be made to each
Participant reflecting the actual attainment of the performance objectives.

 

(d)                                 Termination
of Employment.  If a Participant’s
employment is terminated during the Performance Period for any reason, the
Participant shall forfeit any and all Awards for the Performance Period.  Payment of Awards to Participants whose
employment is terminated following the end of any fiscal quarter, but prior to
the expiration of the Performance Period, shall be paid at the sole and
exclusive discretion of the Committee together with the President and CEO (or
with respect to the President and CEO, the sole and exclusive discretion of the
Committee).  Unless otherwise
specifically determined by the Committee with respect to the President and CEO,
or the Committee together with the President and CEO with respect to any other
Participants, no payments shall be made to any Participant for any quarter in
which the Participant was not an employee for the entire quarter.

 

6.                                      NO
RIGHT TO EMPLOYMENT.

 

Neither the Plan nor any action taken hereunder shall
be construed as conferring upon any Participant the right to continued
employment by the Company or limit in any way the Company’s right to terminate any
Participant’s employment at will or in accordance with such employee’s written
employment agreement, if any.

 

7                                         NONTRANSFERABILITY
OF AWARDS.

 

An Award shall not be transferable or assignable by
the Participant other than by will or by the laws of descent and distribution.

 

8.                                      TAXES;
OFFSET OF AWARDS.

 

Prior to the payment of an Award, the Company may
withhold, or require the Participant to remit to the Company, an amount
sufficient to pay any federal, state, and local taxes associated with the
Award.  Notwithstanding anything to the
contrary herein, the Committee, in its sole discretion, may reduce any amounts
otherwise payable to any Participant hereunder in order to satisfy any
liabilities owed to the Company by the Participant.   All Awards shall be considered salary of the
Participant for purposes of the Company’s 401(k) Plan.

 

9.                                      ADJUSTMENTS
UPON CERTAIN EVENTS; AMENDMENTS; TERMINATION.

 

The Committee together with the President and CEO
shall have the discretion to decrease, but not increase, the amount of any
payment otherwise payable pursuant to an Award based on such factors as they
shall deem appropriate.  In the event of
any material change in the business assets, liabilities or prospects of the
Company, or any division of the Company, the Committee together with the
President and CEO, in their sole discretion and without liability to any person
may make such adjustment, if any, as they deem to be equitable as to any
affected

 

 

terms
of outstanding Awards (other than with respect to Awards to the President and
CEO).  In addition, the Committee
together with the President and CEO may at any time without notice, amend or
alter the performance objectives or any part thereof with respect to Awards
(other than with respect to Awards to the President and CEO).  The Committee together with the President and
CEO may amend, alter or discontinue the Plan or any part thereof.

 

10.                               MISCELLANEOUS
PROVISIONS.

 

The Company is the sponsor and legal obligor under the
Plan and shall make all payments hereunder. 
The Company shall not be required to establish any special or separate
fund or to make any other segregation of assets to ensure the payment of any
amounts under the Plan, and the Participants’ rights to the payment hereunder
shall be no greater than the rights of the Company’s unsecured creditors.  All expenses involved in administering the
Plan shall be borne by the Company.

 

11.                               CHOICE
OF LAW.

 

The Plan shall be governed by and construed in
accordance with the laws of the State of Ohio applicable to contracts made and
to be performed in the State of Ohio.

 

12.                               EFFECTIVENESS
OF THE PLAN.

 

The Plan shall become effective on the date it is
approved by the Board and will continue in effect until terminated by the
Board.

 

 

SCHEDULE
I

 

MAXIMUM
AWARDS

 

 

	
  President and Chief Executive Officer

  	
   

  	
  No Cap

  
	
   

  	
   

  	
   

  
	
  All Participants other than

  	
   

  	
  No Cap

  
	
  the President and Chief Executive

  	
   

  	
   

  
	
  OfficerExhibit 10.3

 

 

	
   

  	
  450 WEST 33RD STREET

  
	
   

  	
  NEW YORK, NY 10001

  
	
   

  	
  212 884 2000 P

  
	
   

  	
  212 884 2396 F

  

 

NEW
YORK & COMPANY

450
West 33rd Street

New
York, NY 10001

 

 

Robert Luzzi

 

Re:  Letter Agreement of
Employment

 

Dear Bob:

 

This letter agreement (this “Agreement”)
sets forth the terms and conditions of your employment, and your employment
relationship, with Lerner New York, Inc. (the “Company”).  Your execution of this Agreement will
represent your acceptance of all of the terms set forth below and will supercede
any other Letter Agreement of Employment entered into prior to this Agreement.

 

1.             Nature of Agreement and Relationship.  This Agreement does not represent an
employment contract for any specified term. 
Your employment relationship thus will remain “at-will,” meaning that,
subject to the terms hereof, either party to this Agreement may terminate the
employment relationship at any time for any lawful reason.

 

2.             Job Title and Duties. 
Your job title will
be Executive Vice President, Creative Services. 
You will be expected to devote all of your full time efforts to the
performance of the duties and responsibilities normally associated with this
position, including those from time-to-time that may be assigned to you by your
Supervisor, the President, the Chief Executive Officer, the Chief Operating
Officer or the Board of Directors of the Company (or the designee of any of the
foregoing).

 

3.             Salary.  For
the 12-month period ending on the last Saturday of each January (the last day
of the fiscal year), you will receive a base salary at the rate of $485,000 per
annum (“Base Salary”), subject to the remaining provisions of this
Section.   For the remainder of the
current fiscal year starting on the date of this Agreement, your Base Salary
will be pro rated based on the number of days remaining in such fiscal year
divided by 365.  At the Company’s sole
discretion, your Base Salary may be increased or decreased based on your
performance and the performance of the business.  You will be paid in accordance with the Company’s
normal payroll policies and practices, with all applicable deductions being
withheld from your paychecks.

 

4.             Bonus. 
You will be eligible
to participate in the Company’s then current bonus plan, in accordance with its
terms and conditions, and to receive performance-based bonuses pursuant to any
formula that may be established.  For the
Company’s current fiscal year, your bonus target for the spring bonus (relating
to the Company’s results for the first and second fiscal quarters of each
fiscal year) will be 24% of your Base Salary and for the fall bonus (relating
to the Company’s results for the third and fourth fiscal quarters of each
fiscal year) will be 36% of your Base
Salary.  Any bonus will be payable in the
month following the last quarter to which that bonus relates.  All bonuses are determined at the Company’s
sole discretion, and the Company

 

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has the sole discretion to
modify or terminate any bonus plan and that plan will govern your right, if
any, to a bonus payment upon termination of your employment.

 

5.             Stock Options and Other Long-Term
Incentives.  You
will be eligible to receive awards under stock option, restricted stock or
other equity-based long-term incentive plans established by the Company (or an
Affiliate) that cover executive officers of the Company.  The term “Affiliate” means any
corporation, partnership, limited liability company or other entity (other than
the Company) that controls or is controlled by the Company, whether directly or
indirectly, such as a parent company or subsidiary.  All equity awards described in this paragraph
are determined at the Company’s sole discretion, and the Company has the sole
discretion to modify or terminate any stock option, restricted stock or other
equity-based long-term incentive plan and that plan will govern your rights, if
any, relating to any equity award(s) you have received, or may be entitled to
receive, upon termination of your employment.

 

6.             Employee Benefits.  You
will be entitled to participate in all employee benefits plans, practices and
programs maintained by the Company and made available to senior executives
generally and as may be in effect from time to time (the “Benefits Plans”).  Your participation in the Benefits Plans will
be on the same basis and terms as are applicable to senior executives of the
Company generally.  Benefits Plans
include, but are not limited to, savings and retirement plans, deferred
compensation, health and prescription drug benefits, disability benefits, other
insurance programs, vacation and other leave, merchandise discounts and
business expense procedures.  Plan
documents setting forth terms of certain of the Benefits Plans are available
upon request, which plan documents control all questions of interpretation concerning
applicable Benefits Plans, including your rights, if any, upon termination of
your employment.  The Benefits Plans are
subject to modification or termination by the Company at any time, at its sole
discretion, in accordance with their terms.

 

7.             Severance Pay.  Upon
your termination of employment by the Company and all Affiliates without Cause
(as defined below), but subject to your performance of all post-employment
obligations set forth in this Agreement and also subject to your signing a
release of claims in a form acceptable to the Company, you will be entitled to
receive severance pay for twelve (12) months “Severance Period” at your final Base
Salary (“Severance Pay”), beginning the first pay period following your
separation date and ending upon the earlier of: 
(i)  your receipt of 52 such payments or (ii) your first day of employment with
another employer, whichever is earlier. 
If you obtain employment at an annual salary that is lower than your
final Base Salary, you will continue to receive the differential between the
two rates of pay for the balance of the 52 weeks. This Severance Pay, which
will be subject to applicable deductions required by law, will be paid on the
Company’s regular payroll dates for the balance of the twelve (12) month “Severance Period” following
your termination date, as outlined above. 
For purposes of this Agreement, “Cause” means: (i) your wrongful
misappropriation of the Company’s or an Affiliate’s assets of a material value;
(ii) any physical or mental impairment that renders you incapable of performing
the essential functions of your position with reasonable accommodations; (iii)
your conviction of, or pleading “guilty” or “no contest” to, a felony; (iv)
your intentionally causing the Company or an Affiliate to violate a material
local state or federal law in any material respect; (v) your willful refusal to
comply with a significant, lawful and proper policy, directive or decision of
your supervisor or the Board in furtherance of a legitimate business purpose or
your willful refusal to perform the duties reasonably assigned to you
consistent with your functions, duties and responsibilities, in each case, in
any material respect, and only if not remedied within thirty (30) days after
receipt of written notice from the Company; or (vi) your breach of this
Agreement, in any material respect, not remedied within thirty (30) days after
receipt of written notice from the Company.

 

8.             Confidential Information,
Intellectual Property.

 

8.1           Confidentiality.  You
agree to not disclose, distribute, publish, communicate or in any way cause to
be disclosed, distributed, published, or communicated in any way or at any
time, Confidential Information (as defined herein), or any part of

 

2

 

Confidential
Information, to any person, firm, corporation, association, or any other
operation or entity except on behalf of the Company in performance of your
duties and responsibilities for the Company, and then only in a fashion
consistent with protecting the Confidential Information from unauthorized use
or disclosure, except as otherwise approved by the Company.  You further agree not to use or permit the
reproduction of any Confidential Information except on behalf of the Company in
your capacity as an employee of the Company. 
You agree to take all reasonable care to avoid the unauthorized
disclosure or use of any Confidential Information.  You assume responsibility for and agree to
indemnify and hold harmless the Company from and against any disclosure or use
of the Confidential Information in violation of this Agreement.

 

8.2           Confidential Information.  For
the purpose of this Agreement, “Confidential Information” shall mean any
written or unwritten information which relates to and/or is used in the Company’s
business (including, without limitation, information related to the names,
addresses, buying habits and other special information regarding past, present
and potential customers, employees and suppliers of the Company; customer and
supplier contracts and transactions or price lists of the Company and
suppliers; all agreements, files, books, logs, charts, records, studies,
reports, processes, schedules and statistical information relating to the
Company; all products, services, programs and processes sold, and all computer
software licensed or developed by the Company; data, plans and specifications
related to present and/or future development projects of the Company; financial
and/or marketing data respecting the conduct of the present or future phases of
business of the Company; computer programs, computer- and/or web-based training
programs, systems and/or software; ideas, inventions, trademarks, business
information, know-how, processes, techniques, improvements, designs, redesigns,
creations, discoveries and developments of the Company; and finances and
financial information of the Company) which the Company deems confidential and
proprietary, which is generally not known to others outside the Company, or
which gives or tends to give the Company a competitive advantage over persons
who do not possess such information or the secrecy of which is otherwise of
value to the Company in the conduct of its business regardless of when and by
whom such information was developed or acquired, and regardless of whether any
of these are described in writing, copyrightable or considered copyrightable,
patentable or considered patentable.  “Confidential
Information” shall not include general industry information or information
which is publicly available or otherwise known to those persons outside the
Company working in the area of the business of the Company or is otherwise in
the public domain without breach of this Agreement or information which you
have lawfully acquired without an obligation to maintain the information in
confidence from a source other than the Company.  “Confidential Information” specifically
includes information received by the Company from others, including the Company’s
clients, that the Company has an obligation to treat as confidential and also
includes any confidential information acquired or obtained by you while in the
employment of any of the Company’s subsidiary or affiliated companies or any
company which has been acquired by the Company.

 

8.3           Invention Ownership.  With
respect to information, inventions and discoveries developed, made or conceived
by you, either alone or with others, at any time during your employment by the
Company and whether or not within normal working hours, arising out of such
employment or pertinent to any field of business or research in which, during
such employment, the Company is engaged or (if such is known to or
ascertainable by you) is considering engaging, you agree:

 

3

 

(a)           that all such information, inventions and discoveries, whether or not
patented or patentable, shall be and remain the sole property of the Company;

 

(b)           to disclose promptly to an authorized representative of the Company all
such information, inventions and discoveries and all information in your
possession as to possible applications and uses thereof;

 

(c)           not to file any patent applications relating to any such invention or
discovery except with the prior consent of an authorized representative of the
Company; and

 

(d)           at the request of the Company, and without expense or additional
compensation to you, to execute such documents and perform such other acts as
the Company deems necessary, to obtain patents on such inventions in a
jurisdiction or jurisdictions designated by the Company, and to assign to the
Company or its designee such inventions and all patent applications and patents
relating thereto.

 

Both the Company and you
intend that all original works of authorship within the purview of the
copyright laws of the United States authored or created by you in the course of
your employment with the Company will be works for hire within the meaning of
such copyright laws.

 

8.4           Confidentiality of Inventions; Return of
Materials and Confidential Information.  With respect to the
information, inventions and discoveries referred to in Section 8.3, and also
with respect to all other information, whatever its nature and form and whether
obtained orally, by observation, from graphic materials, or otherwise (except
such as is generally available through publication) obtained by you during or
as a result of your employment by the Company and relating to any product,
service, process, or apparatus or to any use of any of them, or to materials,
tolerances, specifications, costs (including manufacturing costs), prices, or
to any plans of the Company, you agree:

 

(a)           to hold all such information, inventions and discoveries in strict
confidence and not to publish or otherwise disclose any portion thereof except
with the prior consent of an authorized representative of the Company;

 

(b)           to take all reasonable precautions to ensure that all such information,
inventions, and discoveries are properly protected from access by unauthorized
persons;

 

(c)           to make no use of any such information, invention, or discovery except
as required or permitted in the performance of your duties and responsibilities
for the Company; and

 

(d)           upon termination of your employment by the Company, or at any time upon
request of the Company, to deliver to the Company all graphic materials and all
substances, models, prototypes and the like containing or relating to
Confidential Information or any such information, invention, or discovery, all
of which graphic materials and other things shall be and remain the sole
property of the Company.  The term “graphic
materials” includes letters, memoranda, reports, notes, notebooks, books of
account, drawings, prints, specifications, formulae, data printouts,
microfilms, magnetic tapes and disks and other documents and recordings,
together with all copies thereof.

 

4

 

9.             Non-Solicitation. 
Regardless of whether
you are eligible to receive Severance Pay, you agree
that, if your employment with the Company ends for any reason, you will not,
for a period if eighteen (18) months following such termination of employment,
(i) directly or indirectly, either for yourself or for any other person,
business, company or entity, hire from the Company or any Affiliate, or attempt
to hire, divert or take away from the Company or any Affiliate, any of the then
current officers or employees of the Company or any Affiliate, (ii) interfere
with or harm, or attempt to interfere with or harm, the relationship of the
Company or any Affiliate with any person who at any time was an employee,
customer or supplier of the Company or any Affiliate or otherwise had a
business relationship with the Company or any Affiliate, or (iii) unless
compelled by law to do so, directly or indirectly, knowingly make any statement
or other communication that impugns or attacks the reputation or character of
the Company or any Affiliate, or damages the goodwill of the Company or any
Affiliate, or knowingly take any action, directly or indirectly, that would
interfere with any contractual or customer or supplier relationships of the
Company or any Affiliate.

 

10.           Non-Competition. If you resign your employment, or if your
employment is terminated with Cause, for a period of eighteen (18) months following
such employment termination, you may not and will not, within the United States
of America, directly or indirectly, without the prior written consent of the
Company’s chief executive officer or its Board of Directors (which may be given
or withheld in its sole discretion), own, manage, operate, join, control, be
employed by, consult with or participate in the ownership, management,
operation or control of, or be connected with (as a stockholder, partner or
otherwise) any business, partnership, firm, company, corporation or other
entity engaged in the retail business of women’s fashion apparel,  accessories and related products or any other
product sold or intended to be sold by the Company or an Affiliate during your
employment with the Company. 
Notwithstanding the foregoing, your beneficial ownership after your
termination of employment with the Company, either individually or as a member
of a group, of not more than two percent (2%) of the voting stock of any
publicly held corporation shall not be a violation of this provision.

 

11.           Remedies.  You
acknowledge that money will not adequately compensate the Company for the
substantial damages that will arise upon the breach of any provision of
Sections 8, 9 and 10 of this Agreement and that the Company would have no
adequate remedy at law.  For this reason,
any claim the Company may make that you have breached or are threatening to
breach Sections 8, 9, or 10 is not subject to mandatory arbitration under
Section 14.  Instead, if you breach or
threaten to breach any provision of Sections 8, 9 or 10, the Company will be
entitled, in addition to other rights and remedies, to specific performance,
injunctive relief and other equitable relief to prevent or restrain any breach
or threatened breach of Sections 8, 9 or 10. 
The Company may obtain such relief from (i) any court of competent
jurisdiction, (ii) an arbitrator acting pursuant to Section 14 hereof,  or (iii) a combination of the two (e.g., by
simultaneously seeking arbitration under Section 14 and a temporary injunction
from a court pending the outcome of the arbitration).  It shall be the Company’s sole and exclusive
right to elect which approach to use to vindicate its rights.  You also agree that in the event of a breach
(or any threat of breach) the Company shall be entitled to obtain an immediate
injunction and restraining order to prevent such breach and/or threatened
breach and/or continued breach, without having to prove damages, and to obtain all
costs and expenses, including reasonable attorneys’ fees and costs.  In addition, the existence of any claim or
cause of action by you against the Company, whether predicated on this
Agreement or otherwise, shall not constitute a defense to the enforcement by
the Company of the restrictive covenants of this Agreement.

 

12.           Acknowledgment of Reasonableness. 
You and the Company
specifically agree that the provisions of the restrictive covenants contained
in this Agreement, including the post-employment covenants regarding
non-solicitation and non-competition, are reasonable and that the Company would
not have entered into this Agreement but for the inclusion of such
covenants.  You understand that the
Company’s business is nationwide, and, therefore, a nationwide restrictive
covenant is reasonable.  If a court or
arbitrator determines that any provision of any such restrictive covenant is
unreasonable, whether in period of time, geographical area, or otherwise, you
and the Company agree that the covenant shall be

 

5

 

interpreted
and enforced to the maximum extent which a court or arbitrator deems
reasonable.  In addition, you and the
Company authorize any such court or arbitrator to reform these restrictions to
the minimum extent necessary.

 

13.           Company Property.  Upon
your termination of employment for any reason, you will promptly return to the
Company all Company-related documents and Company property within your
possession or control.

 

14.           Arbitration of Disputes. 
Except as set forth in Section 11, any dispute, claim or difference arising
out of or in relation to your employment will be settled exclusively by binding
arbitration administered by the American Arbitration Association under its National
Rules for the Resolution of Employment Disputes before a single arbitrator. The
Executive expressly understands and agrees that claims subject to arbitration
under this section include asserted violations of the Employee Retirement and
Income Security Act of 1974; the Age Discrimination in Employment Act; the
Older Worker’s Benefit Protection Act; the Americans with Disabilities Act;
Title VII of the Civil Rights Act of 1964 (as amended); the Family and Medical
Leave Act; and any law prohibiting discrimination, harassment or retaliation in
employment, whether based on federal, state or local law; any claim of breach
of contract, tort, promissory estoppel or detrimental reliance, defamation,
intentional infliction of emotional distress; or the public policy of any
state, or any other federal, state or local law. The arbitration will be held in
New York, New York unless you and the Company (each a “Party,” and
jointly, the “Parties”) mutually agree otherwise.  To the extent permitted by law, each Party
will bear its own costs and fees of the arbitration, and other fees and
expenses of the arbitrator will be borne equally by the Parties; provided, however, that
the arbitrator will be empowered to require any one or more of the Parties to
bear all or any portion of fees and expenses of the Parties and/or the fees and
expenses of the arbitrator in the event that the arbitrator determines such
Party has acted in bad faith.  The
arbitrator will have the authority to award any remedy or relief that a court
of the State of New York could order or grant. 
The decision and award of the arbitrator will be binding on all
Parties.  Either Party to the arbitration
may seek to have the ruling of the arbitrator entered in any court having
jurisdiction thereof.  Each Party agrees
that it will not file suit, motion, petition or otherwise commence any legal
action or proceeding for any matter which is required to be submitted to
arbitration as contemplated herein, except in connection with the enforcement
of an award rendered by an arbitrator and except to seek the issuance of an
injunction or temporary restraining order pending a final determination by the
arbitrator.

 

15.           Post-Termination Cooperation.  As is
required of you during employment, you agree that during and after employment
with the Company you will, without expense or additional compensation to you,
cooperate with the Company or any Affiliate in the following areas:

 

15.1         Cooperation With the Company.  You agree
[a] to be reasonably available to
answer questions for the Company’s (or any Affiliate’s) officers regarding any
matter, project, initiative or effort for which you were responsible while
employed by the Company and [b] to
cooperate with the Company (and with any Affiliate) during the course of all
third-party proceedings arising out of the Company’s (or any Affiliate’s)
business about which you have knowledge or information.  For purposes of this Agreement, [c] “proceedings” includes internal investigations,
administrative investigations or proceedings and lawsuits (including pre-trial
discovery and trial testimony) and [d] ”cooperation”
includes [i] your being
reasonably available for interviews, meetings, depositions, hearings and/or
trials without the need for subpoena or assurances by the Company (or any
Affiliate), [ii] providing any and all
documents in your possession that relate to the proceeding, and [iii] providing assistance in locating any and all
relevant notes and/or documents.

 

15.2         Cooperation With Media.  You
agree not to communicate with, or give statements to, any member of the media
(including print, television or radio media) relating to

 

6

 

any
matter (including pending or threatened lawsuits or administrative
investigations) about which you have knowledge or information (other than
knowledge or information that is not Confidential Information as defined in
Section 8.2) as a result of employment with the Company.  You also agree to notify the Chief Executive
Officer or his designee immediately after being contacted by any member of the
media with respect to any matter affected by this section.

 

16.           Entire Agreement. 
This Agreement
constitutes your entire agreement with the Company relating to the subject
mater hereof, and superseded in its entirety any and all prior agreements,
understandings or arrangements with the Company.

 

17.           Governing Law. 
All issues and
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by, and construed in accordance with, the
laws of the State of New York.

 

18.           Survival of Provisions.  Sections 8 to 12, 14, 15, 17 and 18 will survive
the termination of your employment for any reason and shall not be affected by
any transfer(s) between the Company and its Affiliate(s).

 

19.           Understandings and
Representations.
 You should not sign this Agreement until you
understand its terms and conditions. 
Your execution of this Agreement represents your acknowledgement that
you have take all steps you believe necessary, including consultation with
financial and/or legal advisors of your choice, to understand this Agreement.

 

 

	
  Sincerely,

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
  /s/ Richard P. Crystal

  	
   

  	
  Dated:

  	
  March 13, 2006

  
	
  Name: 

  	
  Richard Crystal

  	
   

  	
   

  	
   

  
	
   

  	
  Chief Executive Officer

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  /s/ Robert Luzzi

  	
   

  	
  Dated:

  	
  March 13, 2006

  
	
  Robert Luzzi

  	
   

  	
   

  	
   

  
	
  Executive Vice President,
  Creative

  	
   

  	
   

  	
   

  
						

 

7

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