Employment Agreement with Ilia Lekach

EX-10.1 4 g75943ex10-1.txt EMPLOYMENT AGREEMENT WITH ILIA LEKACH EXHIBIT 10.1 EMPLOYMENT AGREEMENT THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into, and shall be binding this 1st day of February 2002, by and between the E Com Ventures (ECMV), Inc., a Florida corporation ("Employer") and Ilia Lekach ("Executive"). W I T N E S S E T H: WHEREAS, Employer, is engaged in the business of selling perfumes and cosmetics on a discount basis, investing in and developing Internet related businesses; and WHEREAS, Executive is experienced in the management and operation of such business and is professionally qualified to perform such services for the Employer; and WHEREAS, Employer desires to retain the services of the Executive; and WHEREAS, Executive is desirous of obtaining employment with the Employer on the terms and conditions set forth herein. NOW, THEREFORE, in consideration of the mutual promises set forth herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Employer and Executive agree as follows: 1. Recitals, Representations and Warranties. The foregoing recitals are true and correct and are incorporated herein by this reference. In addition to the foregoing recitals, Executive represents that he has not been convicted of any crime, has not been declared insolvent and has not filed for bankruptcy. In addition to the foregoing recitals, Employer represents and warrants that the individual executing this Agreement has authority to do so. 2. Employment. In exchange for the Compensation (as hereinafter defined) and subject to the other terms and conditions hereinafter set forth, Employer hereby employs Executive, as its Chief Executive Officer and Chairman of the Board, to perform the Executive Duties (as hereinafter defined) and Executive hereby accepts such employment. 3. Duties. The Executive shall perform such executive and administrative services in the running of the business of the Employer as the Employer's Board of Directors may assign to the Executive during the Term (as hereinafter defined). During the Term (as hereinafter defined), the Executive shall report directly to ECMV's Board of Directors. a. Performance of Executive Duties & Adherence to Policies. During the Term (as hereinafter defined), Executive shall render the Executive Duties exclusively for Employer, shall perform the Executive Duties to the best of his ability and shall operate Employer's business efficiently and profitably adhering, at all times, to the policies of the Employer and ECMV. 4. Term. The term of the Agreement shall commence on February 1, 2002 and shall expire on January 31, 2005. 5. Compensation. In consideration of and as compensation in full for Executive's performance of the Executive Duties hereunder, Employer agrees to compensate Executive as follows: a. Signing Bonus. Employer shall pay Executive a signing bonus of $250,000 as of February 1, 2002. Such signing bonus shall be in consideration of and as compensation for services provided to Employer in fiscal 2001. b. Salary. During the term of this Agreement, Employer shall pay Executive a gross annual salary of Four Hundred Sixty Thousand Dollars ($460,000)("Salary"). Such Salary shall be paid by Employer in accordance with Employer's regular payroll practices. Employer shall be entitled to deduct or withhold from all Salary payable hereunder all amounts required to be deducted or withheld from same pursuant to state or federal law. c. Stock Option Plan: (1) Executive shall be granted five hundred thousand ( 500,000) options of ECMV Inc., at a price equal to the price of the stock at the close of the market on January 31, 2002. Such options shall vest 1/3 each after each twelve (12) month period from date of contract. d. Performance Bonus Plan. The Executive shall be entitled to a bonus equal to: (1) 20% of Executive's salary to the extent that Net Income of the Company exceed $1,000,000. (2) a) An additional 2% of Executive's salary for each increment of $100,000 in the Company's Net Income over $1,000,000 up to $6,000,000, and b) to the extent that the Company's net income exceeds $6,000,000, executive shall receive a bonus of 130% of salary plus 3% of executive's salary for each $100,000 increment over $6,000,000. (3) For the purpose of this paragraph, Net Income is defined as net income reported in S.E.C. Form 10-K (after taking into account extraordinary income or loss). (4) Withholding. Employer shall be entitled to deduct or withhold from all bonus payments paid persuant to this paragraph 5.b. all amounts required to be deducted or withheld from same pursuant to state or federal law. e. 401k Plan, Expense Reimbursement & Insurance. Executive shall be entitled to participate in the Employer's 401(k) plan, be reimbursed for business expenses and receive full health, disability and life insurance. f. Vacation. Employee shall be entitled to take up to twenty (20) working days of vacation per twelve (12) month period during the Term. g. Increases In Salary, Additional Bonuses & Additional Options. Each year after the initial term, Executive's salary shall be increased by the higher of 5% or C.P.I. 6. Early Termination of Contract. a. Early Termination. To the extent that the Company shall decide to terminate this agreement prior to January 31, 2005, Executive shall be entitled to compensation as defined in paragraph 5 (including salary, stock plan and insurance coverage) for the greater of twelve months or the remainder of the Term of the Agreement as if Executive was still employed and this agreement was in full effect. 2 7. Miscellaneous. a. Notices. All notices, demands or other communications given hereunder shall be in writing and shall be deemed to have been duly given only upon hand delivery thereof or upon the first business day after mailing by United States registered or certified mail, return receipt requested, postage prepaid, addressed as follows: To Employer: E Com Ventures, Inc. 11701 N.W. 101 Road Miami, Florida 33178 To Executive: Ilia Lekach 137 Golden Beach Drive Golden Beach, FL 33160 or to such other address or such other person as any party shall designate, in writing, to the other for such purposes and in the manner hereinabove set forth. b. Accuracy of Statements. No representation or warranty contained in this Agreement, and no statement delivered or information supplied to any party pursuant hereto, contains an untrue statement of material fact or omits to state a material fact necessary in order to make the statements or information contained herein or therein not misleading. The representations and warranties made in this Agreement will be continued and will remain true and complete in all material respects and will survive the execution of the transactions contemplated hereby. c. Entire Agreement. This Agreement sets forth all the promises, covenants, agreements, conditions and understandings between the parties hereto, and supersedes all prior and contemporaneous agreements, understandings, inducements or conditions, expressed or implied, oral or written, except as herein contained. d. Binding Effect; Survival & No Assignment. This Agreement shall be binding upon the parties hereto, their heirs, administrators, successors and assigns. This Agreement shall survive and remain effective during any bankruptcy of the Employer. Executive may not assign or transfer his interest herein, or delegate his Executive Duties hereunder, without the written consent of Employer. Any assignment or delegation of duties in violation of this provision shall be null and void. e. Amendment. The parties hereby irrevocably agree that no attempted amendment, modification, termination, discharge or change (collectively, "Amendment") of this Agreement shall be valid and effective, unless the parties shall agree in writing to such Amendment. f. No Waiver. No waiver of any provision of this Agreement shall be effective unless it is in writing and signed by the party against whom it is asserted, and any such written waiver shall only be applicable to the specific instance to which it relates and shall not be deemed to be a continuing or future waiver. g. Gender and Use of Singular and Plural. All pronouns herein shall be deemed to refer to the masculine, feminine, neuter, singular or plural, as the identity of the party or parties, or their personal representatives, successors and assigns may require. h. Counterparts. This Agreement and any amendments may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together will constitute one and the same instrument. i. Headings. The article and section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of the Agreement. j. Arbitration & Governing Law. Any controversy, claim or dispute arising out of or relating to this Agreement and/or Executive's employment with Employer shall be settled by arbitration in accordance with applicable rules of the American Arbitration Association and judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction 3 thereof. This arbitration clause shall be exactly as the arbitration clause signed by all Perfumania employees. This Agreement shall be construed in accordance with the laws of the State of Florida and any proceeding arising between the parties in any manner pertaining or related to this Agreement shall, to the extent permitted by law, be held in Dade County, Florida. k. Further Assurances. The parties hereto will execute and deliver such further instruments and do such further acts and things as may be reasonably required to carry out the intent and purposes of this Agreement. l. No Third Party Beneficiary. This Agreement is made solely and specifically among and for the benefit of the parties hereto, and their respective successors and assigns subject to the express provisions hereof relating to successors and assigns, and no other person shall have any rights, interest or claims hereunder or be entitled to any benefits under or on account of this Agreement as a third-party beneficiary or otherwise. m. Severability. This Agreement is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws, ordinances, rules, and regulations of the jurisdiction in which the parties do business. If any provision of this Agreement, or the application thereof to any person or circumstances shall, for any reason or to any extent, be invalid or unenforceable, the remainder of this Agreement and the application of such provision to other persons or circumstances shall not be affected thereby, but rather shall be enforced to the greatest extent permitted by law. n. Attorneys' Fees. In connection with any proceeding arising out of this Agreement, the prevailing party shall be entitled to recover costs and attorneys' fees, through all appeals, from the other party. o. Renegotiation. To the extent that Employer will make a significant acquisition or merger, this Agreement shall be renegotiated at terms no less favorable than this Agreement. p. Change in Control. To the extent that Employer undergoes a significant change in control or is acquired, all items under Section 5, Compensation, shall be doubled for the duration of the term of this agreement. IN WITNESS WHEREOF, Employer and Executive have executed this Agreement as of the date first above written. WITNESSES: EMPLOYER: By: --------------------------- E COM VENTURES, INC. EXECUTIVE: By: --------------------------- ILIA LEKACH Date: February 1, 2002 4