<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-----------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 27, 1998
I.C. ISAACS & COMPANY, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 0-23379 52-1377061
(State or Other Jurisdiction of (Commission File Number) (IRS Employer
Incorporation) Identification No.)
3840 Bank Street, Maryland 21224-2522
(Address of Principal Executive Offices) (ZIP Code)
Registrant's telephone number, including area code (410) 342-8200
(Former Name or Former Address, if Changed Since Last Report)
<PAGE>
Item 5. Other Events.
On August 27, 1998 I.C. Isaacs & Company, Inc. (the "Company")
announced that its Board of Directors had approved a restructuring of the senior
management team resulting in a streamlined and clarified chain of command.
Robert J. Arnot will remain Chairman of the Board and the Company's sole Chief
Executive Officer. Gerald W. Lear will relinquish his position as Co-CEO, but
will continue to serve as President and will assume the title and
responsibilities of Chief Operating Officer. Gary Brashers has resigned as Chief
Operating Officer and as a member of the Board of Directors. His resignation
reflects the Company's reduction in domestic manufacturing in favor of global
sourcing to move forward as a marketing and brand-driven company focused on
design and image. Mr. Brashers will continue to serve the Company as a
consultant in connection with its existing manufacturing operations in
Mississippi and the expansion of the Company's manufacturing operations in
Mexico. Thomas Ormandy was named by the Board of Directors to fill the vacancy
on the Board of Directors created by Mr. Brashers' resignation and will serve
Mr. Brashers' remaining term which expires in 1999 or until his successor has
been elected and has qualified. Mr. Ormandy has been Vice President-Sales of the
Company since 1986. Previously he was a salesman with Thompson and Company, an
apparel manufacturer, since 1975.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) and (b) Not Applicable
(c) Exhibits. The following exhibits are filed with
this report:
1. I.C. Isaacs & Company, Inc. Press Release dated
August 27, 1998.
2. Amendment No. 1 to Employment Agreement of
Robert J. Arnot dated August 27, 1998.
3. Amendment No. 1 to Employment Agreement of
Gerald W. Lear dated August 27, 1998.
4. Amendment No. 1 to Employment Agreement of Thomas
Ormandy dated August 27, 1998.
5. Amendment No. 1 to Employment Agreement of Eugene
C. Wielepski dated August 27, 1998.
6. Consulting Agreement by and between I.C. Isaacs &
Company, Inc. and Gary B. Brashers dated August
27, 1998.
[Signature on following page.]
2
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SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
I.C. ISAACS & COMPANY, INC.
/s/ Eugene C. Wielepski
---------------------------------------------
Eugene C. Wielepski
Vice President - Finance and Chief Financial
Officer
Date: August 27, 1998
3
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EXHIBIT INDEX
-------------
<TABLE>
<CAPTION>
Exhibit Description Page No.
- ------- ----------- --------
<S> <C>
(c)(1) I.C. Isaacs & Company, Inc. Press Release dated August 27, 1998. 5
(c)(2) Amendment No. 1 to Employment Agreement of Robert J. Arnot dated August
27, 1998 8
(c)(3) Amendment No. 1 to Employment Agreement of Gerald W. Lear dated August
27, 1998 11
(c)(4) Amendment No. 1 to Employment Agreement of Thomas Ormandy dated August
27, 1998. 14
(c)(5) Amendment No. 1 to Employment Agreement of Eugene C. Wielepski dated
August 27, 1998. 17
(c)(6) Consulting Agreement by and between I.C. Isaacs & Company, Inc. and
Gary B. Brashers dated August 27, 1998. 20
</TABLE>
4
<PAGE>
EXHIBIT (c)(1)
I.C. Isaacs & Company, Inc.
3840 Bank Street
Baltimore, Maryland 21224-2522
(Nasdaq: ISAC)
AT THE COMPANY: AT THE FINANCIAL RELATIONS BOARD:
- --------------- ---------------------------------
Eugene C. Wielepski Kelly Lofts - General Inquiries
Chief Financial Officer Lynn Saywer-Landau-Investor Inquiries
(410) 342-8200 Alan Goldsand - Media Inquiries
(212) 661-8030
August 27, 1998
I.C. ISAACS & COMPANY, INC. ANNOUNCES RESTRUCTURING OF SENIOR MANAGEMENT TEAM
AND EXPANSION OF SHARE REPURCHASE PROGRAM
BALTIMORE, MD - I.C. Isaacs & Company, Inc. (Nasdaq: ISAC) today announced that
its Board of Directors has approved a restructuring of the senior management
team resulting in a streamlined and clarified chain of command. Robert J. Arnot
will remain Chairman of the Board and the Company's sole Chief Executive
Officer. Gerald W. Lear will relinquish his position as Co-CEO, but will
continue to serve as President and will assume the title and responsibilities of
Chief Operating Officer.
Gary Brashers has resigned as Chief Operating Officer and as a member of the
Board of Directors. His resignation reflects the Company's reduction in domestic
manufacturing in favor of global sourcing to move forward as a marketing and
brand-driven company focused on design and image. Mr. Brashers will continue to
serve the Company as a consultant in connection with its existing manufacturing
operations in Mississippi and the expansion of the Company's manufacturing
operations in Mexico.
Thomas Ormandy has been named by the Board of Directors to fill the vacancy
created by Gary Brashers' resignation and will serve the remaining term which
expires in 1999 or until his successor has been elected or qualified. Mr.
Ormandy has been Vice President-Sales of the Company since 1986. Previously, he
was a salesman with Thompson and Company, an apparel manufacturer, since 1975.
Robert J. Arnot, Chairman and Chief Executive Officer, commented, "We believe
that the restructuring of our senior management team will streamline the
decision making process. During the past several months, we have aggressively
evaluated our operations and restructured and expanded our merchandising staff
to strengthen our market position. As a result, our Spring 1999 men's lines will
be introduced next week at the `Magic' show in Las Vegas, the industry's
5
<PAGE>
leading showcase for men's apparel retailers. Although we cannot predict
consumer reaction to our lines, we believe we are coming to market with some of
the strongest collections we have ever produced. We believe that the revised
management structure will enable the Company to pursue a clear direction as we
address the challenges ahead and strive to realize our long-term growth
potential.
The Board of Directors has also approved the expansion of the Company's share
repurchase program. Since authorizing the repurchase of up to $3.0 million of
its common stock on June 15, 1998, the Company has repurchased approximately
837,800 shares for an aggregate cost of approximately $2.1 million. The Board
has expanded the repurchase program from $3.0 million to $4.0 million. Any such
purchases will be made from time to time in the open market or privately
negotiated transactions, with the timing, volume and price of purchases at the
discretion of management.
I.C. Isaacs & Company, Inc. is a designer, manufacturer and marketer of
branded sportswear based in Baltimore and New York City. The Company offers
full lines of sportswear for young men, women and boys under the
BOSS-Registered Trademark- brand in the United States and Puerto Rico, for
men and women under the Beverly Hills Polo Club-Registered Trademark- brand
in the United States, Puerto Rico and Europe, and for men and, in the future,
women under the Girbaud-Registered Trademark- brand in the United States and
Puerto Rico. The Company also markets women's sportswear under its own "I.C.
Isaacs-Registered Trademark-," "Lord Isaacs-Registered Trademark-" and
"Pizzazz-Registered Trademark-" brand names and under third-party private
labels.
This announcement contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Those statements include
indications regarding the intent, belief or current expectations of the
Company and its management, including indications of the strength of upcoming
collections. Such statements are subject to a variety of risks and
uncertainties, many of which are beyond the Company's control, which could
cause actual results to differ materially from those contemplated in such
forward-looking statements, including in particular the risks and
uncertainties described under "Risk Factors" in the Company's Prospectus
which include, among other things (i) changes in the marketplace for the
Company's products, including customer tastes, (ii) the introduction of new
products or pricing changes by the Company's competitors, (iii) changes in
the economy and (iv) termination of one or more of its agreements for use of
the BOSS-Registered Trademark-, Beverly Hills Polo Club-Registered Trademark-
and Girbaud-Registered Trademark- brand names and images in the manufacture
and sale of the Company's products. Existing and prospective investors are
cautioned not to place undue reliance on these forward-looking statements
which speak only as of the date hereof. The Company undertakes no obligation
to update or revise the information contained in this press release, whether
as a result of new information, future events or circumstances or otherwise.
6
<PAGE>
EXHIBIT (c)(2)
7
<PAGE>
AMENDMENT NO. 1 TO
EMPLOYMENT AGREEMENT
by and between
I.C. ISAACS & COMPANY, INC.
and
ROBERT J. ARNOT
THIS AMENDMENT NO. 1, dated as of August 27, 1998, is made a part of
that certain EXECUTIVE EMPLOYMENT AGREEMENT (the "Agreement"), dated as May 15,
1997 by and between I. C. Isaacs & Company, Inc. (the "Company"), and Robert J.
Arnot (the "Executive"). It is intended by the parties that the terms of this
Amendment No. 1, to the extent that they are more specific than the terms
contained in the Agreement, or to the extent that they should conflict with the
terms contained in the Agreement, shall supersede the terms of the Agreement.
Section numbers utilized in this Amendment No. 1 correspond, where applicable,
to section numbers used in the Agreement.
W I T N E S S E T H:
Accordingly, in consideration of the mutual covenants and
representations contained herein and the mutual benefits derived herefrom, the
parties hereto agree as follows:
1. Paragraph 2 is hereby restated in its entirety as follows:
2. Term. This Agreement shall begin May 15, 1997 and shall
continue until May 15, 2001. (the "Employment Period") Thereafter, this
Agreement shall renew automatically from Employment Year to Employment
Year, subject to the right of either party to terminate this Agreement
as of the end of any Employment Year upon sixty (60) days' prior
written notice to the other party. An "Employment Year" begins each May
15 and ends on the following May 15.
2. Paragraph 6 A is hereby restated in its entirety as follows:
6. Duties.
A. During the term of this Agreement, the Executive shall serve
as Chairman of the Board and Chief Executive Officer, have such powers
and shall perform such duties as from time to time shall be assigned to
him by the Board of Directors of the Company and as are customary and
incident to the office of Chairman of the Board and Chief Executive
Officer. The Executive shall perform such additional duties and
functions without separate compensation, unless otherwise authorized by
the Board of Directors of the Company.
8
<PAGE>
3. Paragraph 3 is hereby restated in its entirety as follows:
3. Base Salary. The Executive's base salary for each Employment Year
under this Agreement (May 15, 1997 through May 15, 2001) shall be at
the rate of Four Hundred Thousand Dollars ($400,000) per annum. Such
base salary may be increased based on periodic reviews by the
Compensation Committee of the Board of Directors. The Executive's base
salary shall be paid throughout the year, in accordance with normal
payroll practices of the Company.
IN WITNESS WHEREOF, the parties have executed and delivered this
Amendment No. 1 on the date first above written.
ATTEST: I.C. ISAACS & COMPANY, INC.
/s/ Eugene C. Wielepski By: /s/ Gerald W. Lear
- ------------------------------- --------------------------
Secretary Gerald W. Lear, President
WITNESS: EXECUTIVE
/s/ Donna Derencz /s/ Robert J. Arnot
- ------------------------------- --------------------------
Robert J. Arnot
9
<PAGE>
EXHIBIT (c)(3)
10
<PAGE>
AMENDMENT NO. 1 TO
EMPLOYMENT AGREEMENT
by and between
I.C. ISAACS & COMPANY, INC.
and
GERALD W. LEAR
THIS AMENDMENT NO. 1, dated as of August 27, 1998, is made a part of
that certain EXECUTIVE EMPLOYMENT AGREEMENT (the "Agreement"), dated as May 15,
1997 by and between I. C. Isaacs & Company, Inc. (the "Company"), and Gerald W.
Lear (the "Executive"). It is intended by the parties that the terms of this
Amendment No. 1, to the extent that they are more specific than the terms
contained in the Agreement, or to the extent that they should conflict with the
terms contained in the Agreement, shall supersede the terms of the Agreement.
Section numbers utilized in this Amendment No. 1 correspond, where applicable,
to section numbers used in the Agreement.
W I T N E S S E T H:
Accordingly, in consideration of the mutual covenants and
representations contained herein and the mutual benefits derived herefrom, the
parties hereto agree as follows:
1. Paragraph 2 is hereby restated in its entirety as follows:
2. Term. This Agreement shall begin May 15, 1997 and shall
continue until May 15, 2001. (the "Employment Period") Thereafter, this
Agreement shall renew automatically from Employment Year to Employment
Year, subject to the right of either party to terminate this Agreement
as of the end of any Employment Year upon sixty (60) days' prior
written notice to the other party. An "Employment Year" begins each May
15 and ends on the following May 15.
2. Paragraph 6 A is hereby restated in its entirety as follows:
6. Duties.
A. During the term of this Agreement, the Executive shall serve
as President and Chief Operating Officer, have such powers and shall
perform such duties as from time to time shall be assigned to him by
the Chief Executive Officer of the Company and as are customary and
incident to the office of President. The Executive shall perform such
additional duties and functions without separate compensation, unless
otherwise authorized by the Board of Directors of the Company.
11
<PAGE>
3. Paragraph 3 is hereby restated in its entirety as follows:
3. Base Salary. The Executive's base salary for each Employment Year
under this Agreement (May 15, 1997 through May 15, 2001) shall be at
the rate of Four Hundred Thousand Dollars ($400,000) per annum. Such
base salary may be increased based on periodic reviews by the
Compensation Committee of the Board of Directors. The Executive's base
salary shall be paid throughout the year, in accordance with normal
payroll practices of the Company.
IN WITNESS WHEREOF, the parties have executed and delivered this
Amendment No. 1 on the date first above written.
ATTEST: I.C. ISAACS & COMPANY, INC.
/s/ Eugene C. Wielepski By: /s/ Robert J. Arnot
- --------------------------- ----------------------------
Secretary Robert J. Arnot, CEO
WITNESS: EXECUTIVE
/s/ Donna Derencz /s/ Gerald W. Lear
- --------------------------- ----------------------------
Gerald W. Lear
12
<PAGE>
EXHIBIT (c)(4)
13
<PAGE>
AMENDMENT NO. 1 TO
EMPLOYMENT AGREEMENT
by and between
I.C. ISAACS & COMPANY, INC.
and
THOMAS ORMANDY
THIS AMENDMENT NO. 1, dated as of August 27, 1998, is made a part of
that certain EXECUTIVE EMPLOYMENT AGREEMENT (the "Agreement"), dated as May 15,
1997 by and between I. C. Isaacs & Company, Inc. (the "Company"), and Thomas
Ormandy (the "Executive"). It is intended by the parties that the terms of this
Amendment No. 1, to the extent that they are more specific than the terms
contained in the Agreement, or to the extent that they should conflict with the
terms contained in the Agreement, shall supersede the terms of the Agreement.
Section numbers utilized in this Amendment No. 1 correspond, where applicable,
to section numbers used in the Agreement.
W I T N E S S E T H:
Accordingly, in consideration of the mutual covenants and
representations contained herein and the mutual benefits derived herefrom, the
parties hereto agree as follows:
1. Paragraph 2 is hereby restated in its entirety as follows:
2. Term. This Agreement shall begin May 15, 1997 and shall
continue until May 15, 2000. (the "Employment Period") Thereafter, this
Agreement shall renew automatically from Employment Year to Employment
Year, subject to the right of either party to terminate this Agreement
as of the end of any Employment Year upon sixty (60) days' prior
written notice to the other party. An "Employment Year" begins each May
15 and ends on the following May 15.
2. Paragraph 6 A is hereby restated in its entirety as follows:
6. Duties.
A. During the term of this Agreement, the Executive shall serve
as Vice President, have such powers and shall perform such duties as
from time to time shall be assigned to him by the Chief Executive
Officer of the Company. The Executive shall perform such additional
duties and functions without separate compensation, unless otherwise
authorized by the Board of Directors of the Company.
14
<PAGE>
3. Paragraph 3 is hereby restated in its entirety as follows:
3. Base Salary. The Executive's base salary for each Employment Year
under this Agreement (May 15, 1997 through May 15, 2000) shall be at
the rate of Three Hundred Thousand Dollars ($300,000) per annum. Such
base salary may be increased based on periodic reviews by the
Compensation Committee of the Board of Directors. The Executive's base
salary shall be paid throughout the year, in accordance with normal
payroll practices of the Company.
IN WITNESS WHEREOF, the parties have executed and delivered this
Amendment No. 1 on the date first above written.
ATTEST: I.C. ISAACS & COMPANY, INC.
/s/ Eugene C. Wielepski By: /s/ Robert J. Arnot
- ------------------------------ -----------------------------
Secretary Robert J. Arnot, CEO
WITNESS: EXECUTIVE
/s/ Donna Derencz /s/ Thomas Ormandy
- ------------------------------ -----------------------------
Thomas Ormandy
15
<PAGE>
EXHIBIT (c)(5)
16
<PAGE>
AMENDMENT NO. 1 TO
EMPLOYMENT AGREEMENT
by and between
I.C. ISAACS & COMPANY, INC.
and
EUGENE C. WIELEPSKI
THIS AMENDMENT NO. 1, dated as of August 27, 1998, is made a part of
that certain EXECUTIVE EMPLOYMENT AGREEMENT (the "Agreement"), dated as May 15,
1997 by and between I. C. Isaacs & Company, Inc. (the "Company"), and Eugene C.
Wielepski (the "Executive"). It is intended by the parties that the terms of
this Amendment No. 1, to the extent that they are more specific than the terms
contained in the Agreement, or to the extent that they should conflict with the
terms contained in the Agreement, shall supersede the terms of the Agreement.
Section numbers utilized in this Amendment No. 1 correspond, where applicable,
to section numbers used in the Agreement.
W I T N E S S E T H:
Accordingly, in consideration of the mutual covenants and
representations contained herein and the mutual benefits derived herefrom, the
parties hereto agree as follows:
1. Paragraph 2 is hereby restated in its entirety as follows:
2. Term. This Agreement shall begin May 15, 1997 and shall
continue until May 15, 2000. (the "Employment Period") Thereafter, this
Agreement shall renew automatically from Employment Year to Employment
Year, subject to the right of either party to terminate this Agreement
as of the end of any Employment Year upon sixty (60) days' prior
written notice to the other party. An "Employment Year" begins each May
15 and ends on the following May 15.
2. Paragraph 6 A is hereby restated in its entirety as follows:
6. Duties.
A. During the term of this Agreement, the Executive shall serve
as Vice President and Chief Financial Officer, have such powers and
shall perform such duties as from time to time shall be assigned to him
by the President of the Company. The Executive shall perform such
additional duties and functions without separate compensation, unless
otherwise authorized by the Board of Directors of the Company.
17
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3. Paragraph 3 is hereby restated in its entirety as follows:
3. Base Salary. The Executive's base salary for each Employment Year
under this Agreement (May 15, 1997 through May 15, 2000) shall be at
the rate of Two Hundred Thousand Dollars ($200,000) per annum. Such
base salary may be increased based on periodic reviews by the
Compensation Committee of the Board of Directors. The Executive's base
salary shall be paid throughout the year, in accordance with normal
payroll practices of the Company.
IN WITNESS WHEREOF, the parties have executed and delivered this
Amendment No. 1 on the date first above written.
ATTEST: I.C. ISAACS & COMPANY, INC.
/s/ Eugene C. Wielepski By: /s/ Gerald W. Lear
- ------------------------------ -----------------------------------
Secretary Gerald W. Lear, President
WITNESS: EXECUTIVE
/s/ Donna Derencz /s/ Eugene C. Wielepski
- ------------------------------ -----------------------------------
18
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EXHIBIT (c)(6)
19
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CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT is made this 27th day of August 1998, by and
between I. C. Isaacs & Company, Inc., a Delaware corporation (the "Company") and
Gary Brashers (the "Consultant").
EXPLANATORY STATEMENT
The Consultant voluntarily terminated his employment with the Company
effective the date hereof pursuant to Section 11 of his Employment Agreement
dated May 15, 1997.
The Company desires to continue to engage the Consultant's services for
a period of time on the terms and conditions herein set forth, and the
Consultant has agreed to provide such services on the terms and conditions
herein set forth.
NOW, THEREFORE, in consideration of the premises and the mutual
promises made herein, the parties agree as follows:
1. Consultantcy. The Company hereby retains the Consultant during the
Term (as defined below) of this Agreement. The Consultant shall be deemed an
independent contractor and no employment relationship shall exist between the
Company and the Consultant.
2. Term. This Agreement shall begin August 27, 1998 and shall continue
until August 27, 1999 (the "Term"), unless earlier terminated in accordance with
the terms hereof.
3. Fee. The Consultant's fee (the "Fee") for providing services to the
Company during the Term under the terms and conditions of this Agreement shall
be at the rate of Two Hundred Forty-Seven Thousand Dollars ($247,000) per annum.
The Consultant's Fee shall be paid throughout the year as earned, in accordance
with normal payroll practices of the Company.
4. Duties.
A. During the Term of this Agreement, the Consultant shall act as
full-time advisor to the Company in connection with its domestic and foreign
manufacturing operations and shall perform such other duties as from time to
time shall be assigned to him by the President or the Chief Executive Officer of
the Company. The Consultant shall perform such additional
20
<PAGE>
duties and functions without separate compensation, unless otherwise authorized
by the Board of Directors of the Company.
B. The Consultant shall devote his full time, attention, skill, and
energy to the performance of his duties under this Agreement, and shall comply
with all reasonable professional requests of the Company; provided, however,
that the Consultant will be permitted to engage in and manage personal
investments and to participate in community and charitable affairs, so long as
such activities do not interfere with his duties under this Agreement.
5. Expenses. The Company shall reimburse the Consultant for all
reasonable expenses incurred in connection with his duties provided on behalf of
the Company, provided that the Consultant shall keep, and present to the
Company, records and receipts relating to reimbursable expenses incurred by him.
Such records and receipts shall be maintained and presented in a format, and
with such regularity, as the Company reasonably may require in order to
substantiate the Company's right to claim income tax deductions for such
expenses.
6. Office Space. The Company shall provide the Consultant with
customary office space in and access to its manufacturing facilities during the
Term or until the Company no longer conducts manufacturing operations in
Mississippi.
7. Termination of Agreement for Cause. Notwithstanding the provisions
of Section 2 of this Agreement, the Company may terminate the Agreement (and all
of the Consultant's rights and benefits under this Agreement) terminate
immediately and without further notice upon the happening of any one or more of
the following events:
A. The Consultant has been or is guilty of (i) a criminal offense
involving moral turpitude, (ii) criminal or dishonest conduct pertaining to the
business or affairs of the Company (including, without limitation, fraud and
misappropriation), (iii) any act or omission the intended or likely consequence
of which is material injury to the Company's business, property or reputation,
which act or omission continues uncured for a period of ten (10) days after the
Consultant has received written notice from the Company, and/or (iv) gross
negligence or willful misconduct which continues uncured for a period of ten
(10) days after the Consultant has received written notice from the Company;
B. The Consultant persists, for a period of ten (10) days after written
notice from the Company, in a course of conduct reasonably determined by the
Board of Directors of the Company to be in violation of his duties to the
Company under this Agreement or otherwise in violation of the covenants,
agreements or obligations under the terms of this Agreement;
C. The Consultant's death; or
D. The continuous and uninterrupted inability to perform the
Consultant's duties on behalf of the Company, by reason of accident, mental or
physical illness or impairment, or disease, for a period of sixty (60) days from
the first day of such inability to perform his duties.
21
<PAGE>
(Subsections A, B, C, & D of this Section 7 hereinafter referred to collectively
and individually as "Cause").
In the event of a termination of this Agreement for Cause, the Company
shall pay the Consultant his earned Fee through the effective date of the
termination, and the Consultant shall immediately thereafter forfeit all other
rights and benefits, including but not limited to any right to the remaining
unpaid portion of the Fee pursuant to Section 3 of this Agreement, he would
otherwise have been entitled to receive under this Agreement. The Company and
the Consultant thereafter shall have no further obligations under this Agreement
except as otherwise provided in Sections 10 and 11 of this Agreement.
8. Termination of Agreement by the Company Without Cause.
Notwithstanding the provisions of Section 2 of this Agreement, the Board of
Directors may terminate this Agreement, at any time, for reasons other than for
Cause by notifying the Consultant in writing of such termination. If this
Agreement is terminated pursuant to this Section 8, during the remainder of the
Term, the Company shall pay the Consultant his Fee at the rate and in the manner
required by Section 3 and in effect immediately prior to the date of termination
and after the Term, the Company and the Consultant shall have no further
obligations under this Agreement except as otherwise provided in Sections 10 and
11 of this Agreement.
9. Termination of Agreement by the Consultant. Notwithstanding the
provisions of Section 2 of this Agreement, the Consultant may terminate this
Agreement at any time by giving the Board of Directors written notice of his
intent to terminate, delivered at least sixty (60) days prior to the effective
date of such termination.
Upon expiration of the sixty (60) day notice period (or such earlier
date as may be approved by the Board of Directors), the termination by the
Consultant shall become effective. Upon the effective date of such termination,
the Company's obligations under Sections 3, 4, 5 and 6 of this Agreement shall
immediately expire.
10. Non-Competition. The Consultant and the Company recognize that due
to the nature of his relationship with the Company, the Consultant has had and
will have access to, and has acquired and will acquire, and has assisted and
will assist in developing, confidential and proprietary information relating to
the business and operations of the Company (for purposes of this Section 10 and
Section 11 below, the Company shall mean the Company, I.C. Isaacs & Company,
L.P., I. G. Design, Inc., or any of its/their affiliates or successors)
including, without limitation, information with respect to their present and
prospective services, systems, products, clients, customers, agents, and sales
and marketing methods. The Consultant acknowledges that such information has
been and will be of central importance to the Company's business and that
disclosure of it to others or its use by others could cause substantial loss to
the Company. The Consultant and the Company also recognize that an important
part of the Consultant's duties will be to develop good will for the Company
through his personal contact with the Company's clients,
22
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and that there is a danger that this good will, a proprietary asset of the
Company, may follow the Consultant if and when his relationship with the Company
is terminated.
A. The Consultant agrees that during the Term of this Agreement:
(i) The Consultant will not directly or indirectly (for his
own account, or for the account of others) within the United States or
Mexico or Asia, whether as a partner, proprietor, employee, consultant,
agent or otherwise, participate or engage in any business that competes
with, restricts, or interferes with the business of the Company,
including, without limitation, any business in the young men's and
women's sportswear industry.
(ii) The Consultant will not directly or indirectly (for his
own account, or for the account of others) interfere with, solicit, or
accept for himself, his benefit, or for anyone other than the Company,
any of the clients or customers of the Company, at the time of said
termination, or any potential clients or customers solicited or being
solicited by the Company at the time of such termination or within the
period one (1) year prior thereto, or perform any services of any
competitive nature in connection with said clients or customers for
anyone other than the Company.
(iii) The Consultant further agrees that he shall not, at any
time, directly or indirectly (for his own account, or for the account
of others), urge any client or customer or potential client or
potential customer of the Company to discontinue business, in whole or
in part, or not to do business, with the Company.
(iv) The Consultant further agrees that he shall not, at any
time, directly or indirectly (for his own account, or for the account
of others), solicit, hire or arrange to hire any person who at the time
of such hire or within one (1) year prior to the time of such hire was
an employee of the, for himself or for any business entity with which
he may be, or may be planning to be, affiliated or associated, or
otherwise interfere with the retention of employees that the Company
desires to retain as such.
B. The Consultant expressly acknowledges and agrees (i) that the
restrictions set forth herein are reasonable, in terms of scope, duration,
geographic area, and otherwise, (ii) that the protections afforded to the
Company hereunder are necessary to protect its legitimate business interests,
and (iii) that the agreement to observe such restrictions form a material part
of the consideration for this Agreement.
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11. Confidential Information. The Consultant agrees that, during the
Term of this Agreement, he shall not disclose to any person or use the same in
any way, other than in the discharge of his duties under this Agreement in
connection with the business of the Company, any trade secrets or confidential
or proprietary information of the Company, including, without limitation, any
information or knowledge relating to (i) the business, operations or internal
structure of the Company, (ii) the clients (or customers) or potential clients
(or potential customers) of the Company, (iii) any method and/or procedure (such
as records, programs, systems, correspondence, or other documents), relating or
pertaining to projects developed by the Company or contemplated to be developed
by the Company, or (iv) the Company's business which is of a secret or
confidential nature. Further, upon termination of this Agreement for any reason
whatsoever, the Consultant shall not take with him, without prior written
consent of the Board of Directors of the Company, any documents, forms, or other
reproductions of any data or any information relating to or pertaining to the
Company, any clients or customers or potential clients or potential customers of
the Company, or any other confidential information or trade secrets.
12. Entire Agreement; Amendments, Other Agreements. This Agreement
contains the entire understanding of the Consultant and the Company with respect
to the subject matter hereof and supersedes any and all prior understandings,
written or oral. This Agreement may not be amended, waived, discharged or
terminated orally, but only by an instrument in writing.
13. Miscellaneous.
A. Any notices required by this Agreement shall (i) be made in writing
and mailed by certified mail, return receipt requested, with adequate postage
prepaid; (ii) be deemed given when so mailed; (iii) be deemed received by the
addressee within ten (10) days after given or when the certified mail receipt
for such mail is executed, whichever if earlier; and (iv) in the case of the
Company, be mailed to its principal office, or in the case of the Consultant, be
mailed to the last address that the Consultant has given to the Company.
B. This Agreement shall be binding upon and inure to the benefit of,
the parties, their successors, assigns, personal representatives, distributees,
heirs, and legatees.
C. This Agreement shall be governed by, and construed and enforced in
accordance with, the laws of the State of Maryland, without giving effect to the
principles of conflicts of law thereof.
D. In consideration of the payment of the Fee as described herein, the
Consultant hereby acknowledges that he has received all payments and other
benefits payable or issuable to him by the Company under any employee benefit
plan or arrangement (exclusive of any vested but unpaid pension benefits), and
hereby releases and forever discharges, for himself, his successors and assigns,
and the Company and their respective successors and assigns, of and
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from any and all past, present or future claims, payments, demands, or rights
(other than any vested but unpaid pension benefits), whether known or unknown as
of the date hereof, which he might have against the Company or their successors
and assigns arising out of or in connection with any such plan or arrangement or
its termination.
E. Any dispute regarding any aspect of this Agreement or any act which
allegedly has or would violate any provision of this Agreement will be submitted
to binding arbitration. Such arbitration shall be conducted before an arbitrator
sitting in a location agreed to by the Company and the Consultant within fifty
(50) miles of the location of the Consultant's principal office, in accordance
with the rules of the American Arbitration Association then in effect. Each
party will be entitled to limited discovery, to consist of a maximum of three
(3) depositions (maximum two (2) hours each), and twenty-five (25) written
interrogatories per party, which will be completed within sixty (60) days
following the selection of the arbitrator. Judgment may be entered on the award
of the arbitrator in any court having competent jurisdiction.
F. Any failure by the Company to insist upon strict compliance with any
term or provision of this Agreement, to exercise any option, to enforce any
right, or to seek any remedy upon any breach by the Consultant shall not affect,
or constitute a waiver of, the Company's right to insist upon such strict
compliance, exercise such option, enforce such right, or seek such remedy with
respect to such breach or any prior, contemporaneous, or subsequent breach. No
custom or practice of the Company at variance with any provision of this
Agreement shall affect or constitute a waiver of, the Company's right to demand
strict compliance with all provisions of this Agreement.
G. Any provision of this Agreement which is prohibited or unenforceable
in any jurisdiction shall, as to such jurisdiction, be deemed severable from the
remainder of this Agreement, and the remaining provisions contained in this
Agreement shall be construed to preserve to the maximum permissible extent the
intent and purposes of this Agreement. Any such prohibition or unenforceability
in any jurisdiction shall not invalidate or render unenforceable such provision
in any other jurisdiction.
H. In the event that the Consultant violates the provisions of Sections
10 and/or 11 above, upon notice from the Company informing him of the nature of
such violation, the Consultant shall immediately terminate any actions which
constitute such violation. The existence of this right shall not preclude any
other rights and remedies at law or in equity which the Company may have.
I. It is recognized that damages in the event of breach of any
provision of Sections 10 and/or 11 above by the Consultant would be difficult,
if not impossible, to ascertain, and it is therefore agreed that the Company, in
addition to and without limiting any other remedy or right it may have, will be
entitled to a decree of specific performance, mandamus or other appropriate
remedy to enforce performance of such requirements.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first hereinabove written.
I. C. ISAACS & COMPANY, INC.
By: /s/ Gerald W. Lear
------------------------------------
Gerald W. Lear
President
CONSULTANT
/s/ Gary Brashers
------------------------------------
Gary Brashers
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