Exhibit 10.78
RENAISSANCE COSMETICS, INC.
635 MADISON AVENUE
NEW YORK, NEW YORK 10022
May 15, 1998
Mr. John R. Jackson 1116 Preserve Circle Golden, Colorado 80401
RE: EMPLOYMENT AGREEMENT ("AGREEMENT")
Dear John:
This Agreement sets forth the terms and conditions of your continued employment with Renaissance Cosmetics, Inc., a Delaware corporation ("RCI"), Dana Perfumes Corp., a Delaware corporation ("Dana"), Cosmar Corporation, a Delaware corporation, Flirt Cosmetics, Inc., a Nevada corporation ("Flirt"), Marcafin, S.A., a Swiss corporation ("Marcafin"), Perfumes Dana do Brasil, S.A., a Brazilian corporation ("Dana Brasil"), and certain of RCI's other subsidiaries (the "Subsidiaries") as designated from time to time by the Chief Executive Officer and/or Board of Directors of RCI (the "Board"). RCI, Dana, Cosmar, Flirt, Marcafin, and Dana Brasil are collectively referred to herein as the "Employers." This Agreement shall become effective as of May 15, 1998 (the "Effective Date").
1. EMPLOYMENT AND SERVICES. You shall continue to be employed as a Group Vice President, Corporate Development and Human Resources and Secretary of RCI and Vice President and Secretary of each of the Employers and the Subsidiaries, for the period beginning on the Effective Date and ending upon the two year anniversary of the Effective Date or earlier termination pursuant to paragraph 5 (the "Employment Period"); provided, however, that, in the absence of termination, the Employment Period shall be extended for successive one year terms so long as neither party gives written notice of non-renewal to the other party not less than 90 days prior to the then-current scheduled expiration date of the Employment Period. If such notice of non-renewal is given, this Agreement shall expire at the end of the then-current term. During the Employment Period, you shall render such services to the Employers as the Chief Executive Officer
and/or Board shall designate from time to time, and you shall devote your best efforts and full time and attention to the business of the Employers.
Each of the Employers is jointly and severally liable for the obligations hereunder; provided, however, that with respect to the fringe benefits provided hereunder, such benefits shall be provided under RCI's plans and in the event RCI is unable for any reason to provide such benefits, the Employers shall promptly make a cash payment to you in an after-tax amount sufficient to permit you to purchase equivalent benefits in the marketplace. The Employers shall determine, in their discretion, which Employer shall make all cash payments required under the terms of this Agreement, but nothing herein shall limit the joint and several liability of each of the Employers.
2. COMPENSATION. During the Employment Period, the Employers shall pay you an annual base salary of $210,000 ("Base Salary"), payable in installments in accordance with RCI's regular payroll practices. The Base Salary shall be subject to annual review by the Board and possible increase on an annual basis, in the discretion of the Board. In addition, during the Employment Period, you will participate in RCI's senior executive annual bonus program, in such manner and at such level as is determined by the Board; provided, however, that you will be entitled to receive a minimum bonus of $10,000 for each year during the Employment Period without regard to the amount you would otherwise be entitled to receive under the bonus program then in effect. The bonus program is reviewed by the Board yearly at which time the Board sets targets which it deems reasonable for RCI.
3. BENEFITS AND OTHER MATTERS.
(a) INSURANCE AND OTHER BENEFIT PLANS. You shall be entitled to participate in the insurance plans, retirement plans and all other benefit plans generally available to RCI's executive employees as in effect from time to time.
(b) VACATION. During the Employment Period, you shall receive four weeks of paid vacation per year. Unused vacation shall accrue for the following year; however, you agree not to take more than five weeks of vacation in any one year. In addition, any unused vacation (determined on the basis of four weeks per year) from the first date of your employment with any of the Employers up to the Effective Date shall accrue in accordance with the terms hereof. Upon termination of your employment for any reason, you will be entitled to receive payment for any accrued but unused vacation through the date of termination.
(c) INDEMNIFICATION. RCI ratifies and confirms that its obligations under the Indemnification Agreement, dated May 12, 1997, by and between RCI and you, remain in full force and effect, and each of the other Employers agrees to become a party to, and assume and perform the obligations of RCI under, such Indemnification Agreement.
(d) REIMBURSEMENT OF EXPENSES. The Employers will reimburse your reasonable out-of-pocket expenses incurred in connection with the performance of your services
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hereunder, in each case subject to and consistent with RCI's expense reimbursement policy; provided that, for all expenses incurred by you on and after the Effective Date, you prepare expense reports within thirty (30) days of the date the expense is incurred. With respect to all expenses incurred by you prior to the Effective Date for which you have not submitted requests for reimbursement, the Employers will reimburse you for such expenses consistent with RCI's expense reimbursement policy provided that you submit the appropriate documentation by not later than June 15, 1998.
(e) COMPANY CAR. You will be entitled to the use of a company car at the Employers' expense on terms no less favorable than those provided to RCI's executives generally (the "Company Car"). The Employers may, in their discretion, lease or acquire the Company Car for your use, consistent with prior practice; provided, however, that the purchase price of the Company Car (or the purchase price implicit in the lease rate) including all taxes shall not exceed $40,000 (or you may choose a car allowance of $1,000 per month). At the expiration of the Employment Period as provided in paragraph 1 hereof or upon the termination of your employment by the Employers without Cause (as defined below) or by you for Good Reason (as defined below), (i) the Company Car shall become your property, at no expense to you; provided, however, that in the event the Company Car is under lease to the one of the Employers at such time, the Employers may, in their discretion, elect to continue to make the payments under the lease and transfer title to the Company Car to you at the end of the term of the lease, and provided further that you will not be entitled to the continuation of any other benefits under the Employers' then-current car policy, and (ii) the Employers will reimburse you for any federal or state tax liability incurred by you arising out of the transfer of the Company Car to you.
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