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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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)
January 26, 1999
LITTLE SWITZERLAND, INC.
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(Exact name of registrant as specified in charter)
DELAWARE 0-19369 66-0476514
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(State or other jurisdiction (Commission file number) (IRS employer
of incorporation) identification no.)
161-B CROWN BAY CRUISE SHIP PORT, ST. THOMAS, U.S.V.I. 00802
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (340) 776-2010
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Item 5 - Other Events
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Little Switzerland, Inc. (the "Company") issued a press release on
January 26, 1999 announcing settlement of the lawsuit brought by Jewelcor
Management, Inc. A copy of the Company's press release is attached hereto and
incorporated herein in its entirety.
The Company is also filing herewith copies of the Employment Agreement,
Non-Qualified Stock Option Agreement and Success Fee Agreement with C. William
Carey.
Item 7 - Financial Statements, Pro Forma Financial Information and Exhibits
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(c) Exhibits
Exhibit 10.29 - Employment Agreement, effective as of September 1, 1998,
between the Company and C. William Carey.
Exhibit 10.30 - Non-Qualified Stock Option Agreement, effective as of
September 1, 1998, between the Company and C. William
Carey.
Exhibit 10.31 - Success Fee Agreement, dated as of January 15, 1999,
between the Company and C. William Carey.
Exhibit 99.1 - Press Release of Little Switzerland, Inc., dated
January 26, 1999.
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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 thereunto duly authorized.
LITTLE SWITZERLAND, INC.
Date: January 29, 1999 By: /s/ C. William Carey
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C. William Carey
Chief Executive Officer
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EXHIBIT INDEX
Exhibit No. Description
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Exhibit 10.29 - Employment Agreement, effective as of September 1, 1998,
between the Company and C. William Carey.
Exhibit 10.30 - Non-Qualified Stock Option Agreement, effective as of
September 1, 1998, between the Company and C. William Carey.
Exhibit 10.31 - Success Fee Agreement, dated as of January 15, 1999, between
the Company and C. William Carey.
Exhibit 99.1 - Press Release of Little Switzerland, Inc., dated January 26,
1999.
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Exhibit 10.29
EMPLOYMENT AGREEMENT
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AGREEMENT made as of the 1st day of September, 1998, by and among L.S.
Wholesale, Inc., a Massachusetts corporation with its main office in St. Thomas,
U.S.V.I. (the "Employer"), Little Switzerland, Inc., a Delaware corporation with
its main office in St. Thomas, U.S.V.I. ("Little Switzerland"), and C. William
Carey (the "Executive").
WITNESSETH
WHEREAS, the Executive is currently a director of the Employer;
WHEREAS, the Executive possesses certain unique skills, talents and judgment
as well as the knowledge of the Company's businesses, strategies and objectives;
and
WHEREAS, in order to provide for continuity in the executive management of
the Company, which continuity is deemed to be vital to the continued growth and
success of the Company, the Employer and Executive desire to provide for the
Executive's employment by the Employer as its interim President and Chief
Executive Officer.
NOW, THEREFORE, in consideration of the foregoing premises and mutual
covenants contained herein, the Employer and the Executive mutually agree as
follows:
1. Employment. The Employer agrees to employ the Executive and the
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Executive agrees to be employed by the Employer on the terms and conditions
hereinafter set forth.
2. Effective Date and Term. The commencement date (the "Commencement
-----------------------
Date") of this Agreement shall be September 1, 1998. Subject to the provisions
of Section 5 hereof, the term (the "Term") of the Executive's employment
hereunder shall be the earlier of (i) one (1) year from the Commencement Date or
(ii) the date that a Chief Executive Officer and President commences employment.
The last day of such Term is herein sometimes referred to as the "Expiration
Date."
3. Compensation and Benefits. The compensation and benefits payable to the
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Executive under this Agreement shall be as follows:
a. Salary. For all services rendered by the Executive under this
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Agreement, the Employer shall pay the Executive a total salary as follows:
(1) Base Salary. For the Term, the Employer shall pay the
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Executive a base salary at an annual rate (the "Base Salary") equal
to Three Hundred Fifty Thousand Dollars ($350,000); provided,
however, (i) that the Employer shall pay the Executive a minimum of
Eighty-Seven Thousand Five Hundred Dollars ($87,500) in Base Salary
if the Expiration Date occurs
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on or before December 1, 1998 or (ii) the Employer shall pay the
Executive a minimum of One Hundred Seventy-Five Thousand Dollars
($175,000) in Base Salary if the Expiration Date occurs on or after
December 2, 1998 (collectively the "Minimum Salary"). The amount of
Base Salary actually paid to the Executive hereunder prior to the
Expiration Date shall be deducted from the amount payable to the
Executive as Minimum Salary.
(2) Bonus. During the Term, the Employer shall pay to the
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Executive a quarterly bonus (the "Bonus") up to a maximum of Fifty
Thousand Dollars ($50,000) per fiscal quarter of Little Switzerland
subject to meeting the criteria set forth in clause (i) or (ii)
below, as applicable:
(i) The criteria for the Bonus for the second fiscal quarter
of Little Switzerland shall be as follows:
(a) Successful development of a business plan designed
to restructure the organization of Little Switzerland in
order to reduce costs with an aim toward future profitable
earnings by Little Switzerland;
(b) Successful renewal or extension by the end of the
second week of December 1998 of the credit facility with the
Bank of Nova Scotia, which is currently being considered for
renewal or extension, including, without limitation,
submitting an acceptable business plan to such bank;
(c) Significant progress in the negotiations with the
Chase Manhattan Bank concerning the renewal or extension of
the credit facility with such bank when the existing credit
facility is considered for renewal or extension during the
third fiscal quarter of Little Switzerland;
(d) Evidence of progress in the resolution of the
ongoing tax audit with governmental authorities in Aruba
with an aim toward resolution of issues in a timely manner;
(e) Successful production of profit and loss statements
for each of Little Switzerland's retail stores;
(f) Earnings per share for the second fiscal quarter of
Little Switzerland being equal to or less than a loss of
$.26 per share; and
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(g) Net sales for the second fiscal quarter of Little
Switzerland being equal to or greater than $15,337,000.
The criteria set forth in clauses (f) and (g) above shall each
be valued at 25% of the maximum quarterly Bonus for the second
fiscal quarter of Little Switzerland, and the remaining criteria set
forth in clauses (a) through (e) above shall each be valued at 10%
of the maximum quarterly Bonus for the second fiscal quarter of
Little Switzerland. The Board of Directors shall review and take
into account any documented extraordinary items prior to making
their determination as to whether the Executive has met the criteria
set forth in clauses (f) and (g) above.
(ii) The Bonus for any fiscal quarter of Little Switzerland,
other than the second fiscal quarter, which shall be determined
pursuant to clause (i) above, will be based upon performance and
other criteria to be mutually agreed upon by the Employer and
the Executive prior to the applicable quarter; provided,
however, that the criteria for each of the third and fourth
fiscal quarters of Little Switzerland relating to earnings per
share and net sales shall be the numbers set forth in the 1999
Operating Plan of Little Switzerland as approved by the Board of
Directors of Little Switzerland. The Board of Directors shall
review and take into account any documented extraordinary items
prior to making their determination as to whether the Executive
has met the criteria for earnings per share and net sales during
the third and fourth fiscal quarters of Little Switzerland.
The Board of Directors of Little Switzerland shall determine whether
the criteria set forth in clause (i) or (ii) above have been met. In
connection with the foregoing, the Executive shall neither vote in his
capacity as a director of Little Switzerland on any matter related to
such determination nor participate in any meeting or discussions of the
Board of Directors related to such determination. Notwithstanding the
foregoing, the Executive may make a presentation to the Board of
Directors that is solely limited to his determination whether such
criteria have been met. The Employer may pay the Executive up to one
hundred percent (100%) of the quarterly Bonus, if any, for each fiscal
quarter or part thereof that the Executive is employed by Little
Switzerland.
The Executive's Base Salary shall be payable in periodic installments in
accordance with the Employer's usual practice for payment of compensation to its
senior executives. The Bonus, if any, shall be payable within five (5) calendar
days after receipt by the Board of Directors of Little Switzerland of the status
of the non-financial criteria and the financial statements for the fiscal
quarter for which the Bonus applies certified by the Chief Financial Officer of
Little Switzerland.
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b. Stock Bonus Plan. On the Commencement Date, the Executive will be
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awarded an option (the "Option") to purchase 150,000 shares of common stock, par
value $.01 per share, of Little Switzerland upon the terms and conditions set
forth in the Non-Qualified Stock Option Agreement, dated as of the date hereof,
by and between the Executive and Little Switzerland.
c. Living Expenses. The Executive shall be entitled to reimbursement
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for reasonable expenses actually incurred for the purpose of maintaining a place
of residence in St. Thomas, U.S.V.I. (the "Living Expense") up to an aggregate
amount not to exceed Fifty Thousand Dollars ($50,000). The Executive shall also
be entitled to reimbursement for reasonable expenses actually incurred in
connection with one round trip commute per month between the Executive's place
of residence in Boston, Massachusetts, U.S. and his place of residence in St.
Thomas, U.S.V.I. The Executive shall account promptly for the expenses set forth
above to the Employer in the manner reasonably prescribed from time to time by
the Employer and in compliance with the Employer's policy.
The Living Expense shall be payable to the Executive in equal installments
of Twelve Thousand Five Hundred Dollars ($12,500) at the beginning of each
fiscal quarter of the Little Switzerland.
d. Professional Fees. The Executive shall be entitled to reimbursement
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for reasonable personal attorney's fees and expenses actually incurred by the
Executive in connection with the negotiation of this Agreement and the matters
contemplated hereby up to an aggregate amount not to exceed Four Thousand Five
Hundred Dollars ($4,500). The Executive shall account promptly for such expenses
to the Employer in the manner reasonably prescribed from time to time by the
Employer and in compliance with the Employer's policy.
e. Relocation Expenses. The Employer shall pay to or on behalf of the
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Executive all reasonable moving and relocation expenses actually incurred by the
Executive in moving to and from St. Thomas, U.S.V.I. up to an aggregate amount
not to exceed Five Thousand Dollars ($5,000). The Executive shall account
promptly for such expenses to the Employer in the manner reasonably prescribed
from time to time by the Employer and in compliance with the Employer's policy.
f. Regular Benefits. The Executive shall be entitled to participate in
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any and all employee benefit plans, medical insurance plans, life insurance
plans, disability income plans, retirement plans and other benefit plans
(including, without limitation, any 401(k) plans) from time to time in effect
for senior executives of the Employer. Such participation shall be subject to
the terms of the applicable plan documents, generally applicable policies of the
Employer, applicable law and the discretion of the Board of Directors, the
Compensation Committee or any administrative or other committee provided for in
or contemplated by any such plan. Nothing contained in this Agreement shall be
construed to create any obligation on the part of the
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Employer to establish any such plan or to maintain the effectiveness of any such
plan which may be in effect from time to time.
The Executive also shall be entitled to reimbursement for all ordinary and
necessary business expenses incurred by the Executive in connection with the
advancement of Little Switzerland's and the Employer's interests and the
discharge of his duties and responsibilities hereunder, including without
limitation, all travel and lodging expenses; provided, however, that the
Executive accounts promptly for such expenses to the Employer in the manner
reasonably prescribed from time to time by the Employer and in compliance with
the Employer's policy.
g. Success Fee Arrangement. The Executive hereby acknowledges that
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Little Switzerland, at this time, is no longer pursuing a sale of Little
Switzerland or any other strategic business alternatives. The Executive further
hereby acknowledges that (i) the Investment Banking Committee of the Board of
Directors of Little Switzerland, of which the Executive was a member, has been
terminated, (ii) the Success Fee Agreement, dated as of February 4, 1998,
between the Executive and Little Switzerland is no longer in effect and (iii)
the Executive and Little Switzerland will enter into a new success fee
agreement, substantially in the form attached hereto as Exhibit A.
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4. Capacity and Extent of Service.
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a. The Executive shall serve the Employer as interim President and
Chief Executive Officer beginning on September 1, 1998 and shall serve the
Employer in such other or additional offices in which he may be reasonably
requested to serve.
b. During his employment hereunder, the Executive shall, subject to the
direction and supervision of the Board of Directors of the Employer, devote his
full business time, best efforts and business judgment, skill and knowledge to
the advancement of the Employer's interests and to the discharge of his duties
and responsibilities hereunder. In accordance with the foregoing, the Executive
shall not engage in any other business activity, except as may be approved by
the Board of Directors of Little Switzerland; provided, however, that nothing
herein shall be construed as preventing the Executive from:
(1) investing his assets in a manner not otherwise prohibited by
this Agreement, and in such form or manner as shall not require any
material services on his part in the operations or affairs of the companies
or other entities in which such investments are made;
(2) serving on the board of directors of any company, provided
that he shall not be required to render any material services with respect
to the operations or affairs of any such company;
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(3) continuing to perform consulting services for persons or
entities other than Little Switzerland so long as such activities do not
interfere with Executive's ability to perform his responsibilities for
Little Switzerland, are not competitive with the business conducted by
Little Switzerland in its market area, and do not consume a material amount
of his time; or
(4) engaging in religious, charitable or other community or
nonprofit activities which do not impair his ability to fulfill his duties
and responsibilities under this Agreement.
c. The Executive shall resign as Chairman of the Board of Directors of
Little Switzerland effective as of the Commencement Date. The Executive shall
continue to serve as a Director of Little Switzerland until his successor is
duly elected and qualified and subject to being elected by the Company's
stockholders at the next annual meeting, or special meeting in lieu thereof.
Pursuant to Article II of the Amended and Restated Bylaws of Little Switzerland,
as in effect on the date hereof, so long as the Executive is employed by the
Employer and remains a Director of Little Switzerland, he shall not be entitled
to receive any salary or other compensation for his services as a Director of
Little Switzerland, including, without limitation, any director or committee
member fees.
d. The Consulting Agreement, dated as of June 2, 1996, between the
Executive and Little Switzerland (the "Consulting Agreement") shall be
terminated effective as of the Commencement Date. In consideration of the
Executive waiving Section 4(c) of the Consulting Agreement, pursuant to which
the Company is required to give the Executive 90 days' prior written notice to
terminate the Consulting Agreement, Little Switzerland shall pay, simultaneously
with the execution of this Agreement, the Executive Thirty-Seven Thousand Five
Hundred Dollars ($37,500).
5. Termination. Notwithstanding the provisions of Section 2, subject to
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the following provisions, the Executive's employment hereunder shall terminate
under the following circumstances without further liability on the part of the
Employer or right of the Executive to receive any payments except as otherwise
provided in this Agreement:
a. Death. In the event of the Executive's death during the Executive's
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employment hereunder, the Executive's employment shall terminate on the date of
his death.
b. Termination by the Employer for Cause. The Executive's employment
-------------------------------------
hereunder may be terminated for cause (as defined below) by written notice to
the Executive setting forth in reasonable detail the nature of such cause,
effective upon delivery of such notice. Only the following shall constitute
"cause" for termination pursuant to this Section 5.b.:
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(1) Deliberate dishonesty of the Executive with respect to the
Employer or any subsidiary or affiliate thereof;
(2) Conviction of the Executive of a crime involving moral
turpitude ;
(3) Material failure to perform a substantial portion of his
duties and responsibilities hereunder, which failure continues for more
than thirty (30) days after written notice given to the Executive pursuant
to a two thirds vote of all of the members of the Board of Directors of
Little Switzerland (exclusive of the Executive), each such vote to set
forth in reasonable detail the nature of such failure; or
(4) Gross or willful misconduct of the Executive with respect to
the Employer or any subsidiary or affiliate thereof.
c. Termination by the Executive for Cause. The Executive's employment
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hereunder may be terminated by the Executive by written notice to the Board of
Directors of Little Switzerland effective thirty (30) days after the giving of
such notice in the event of a material breach by the Employer of any provision
of this Agreement, which breach shall continue for more than thirty (30) days
after the date on which the Board of Directors of Little Switzerland receives
such notice.
d. Termination by the Employer Without Cause. The Executive's
-----------------------------------------
employment with the Employer may be terminated without cause by a two-thirds
vote of all of the members of the Board of Directors of Little Switzerland
(exclusive of the Executive) on written notice to the Executive effective upon
thirty (30) days after the giving of such notice.
e. Termination by the Executive Without Cause. The Executive may
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terminate his employment with the Employer without cause on written notice to
the Employer effective upon thirty (30) days after the giving such notice.
f. Disability. If, due to physical or mental illness, the Executive
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shall be disabled so as to be unable to perform substantially all of his duties
and responsibilities hereunder (a "Substantial Disability"), the Employer may
designate another executive to act in his place during the period of such
disability. For a period of up to two (2) months subsequent to the commencement
of a Substantial Disability, the Employer shall continue to pay to the Executive
his salary and benefits in accordance with Section 3 hereof. If, at the end of
such two-month period the Executive shall continue to have a Substantial
Disability, the Executive's employment may be terminated by a two-thirds vote of
all of the members of the Board of Directors of Little Switzerland (exclusive of
the Executive) without further liability to the Employer or Little Switzerland.
If any question shall arise as to whether during any period the Executive
suffered a Substantial Disability, the Executive may, and at the request of the
Employer will, submit to the Employer a certification in reasonable detail by a
physician
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selected by the Executive or his guardian to whom the Employer has no reasonable
objection as to whether the Executive was so disabled and such certification
shall for the purposes of this Agreement be conclusive of the issue. If such
question shall arise and the Executive shall fail to submit such certification,
the Employer's determination of such issue shall be binding on the Executive.
g. Employer's Termination Determination. Notwithstanding anything to
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the contrary contained herein, the Executive shall not be entitled to vote in
his capacity as a member of the Board of Directors of Little Switzerland on any
matter related to termination of the Executive by the Employer for cause,
termination of the Executive by the Employer without cause or determination of
whether a Substantial Disability existed.
6. Noncompetition and Confidential Information.
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a. Noncompetition. During the period of the Executive's employment by
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the Employer pursuant to this Agreement, the Executive will not, directly or
indirectly, whether as owner, partner, shareholder, consultant, agent, employee,
co-venturer or otherwise, or through any Person (as defined in Section 8
hereof), compete in Little Switzerland's or the Employer's market area (defined
as any country or other jurisdiction in which Little Switzerland or the Employer
conducts business as of the effective date of termination) with the business
conducted by Little Switzerland or the Employer during the period of his
employment hereunder, nor will he attempt to hire any employee of Little
Switzerland or the Employer, assist in such hiring by any other Person,
encourage any such employee to terminate his or her relationship with Little
Switzerland or the Employer, or solicit or encourage any customer of Little
Switzerland or the Employer to terminate its relationship with Little
Switzerland or the Employer or to conduct with any other Person any business or
activity which such customer conducts or could conduct with Little Switzerland
or the Employer.
b. Confidential information. The Executive will not disclose to any
------------------------
other Person (except as required by applicable law or in connection with the
performance of his duties and responsibilities hereunder), or use for his own
benefit or gain, any confidential information of Little Switzerland or the
Employer obtained by him incident to his employment with the Employer. The term
"confidential information" includes, without limitation, financial information,
business plans, prospects and opportunities (such as lending relationships,
financial product developments, or possible acquisitions or dispositions of
businesses or facilities) of Little Switzerland or the Employer but does not
include any information which has become part of the public domain by means
other than the Executive's non-observance of his obligations hereunder.
c. Relief; Interpretation. The Executive agrees that the Employer
----------------------
shall be entitled to injunctive relief for any breach by him of the covenants
contained in this Section 6. In the event that any provision of this Section 6
shall be determined by any court of competent jurisdiction to be unenforceable
by reason of its being extended over too great a period of time,
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too large a geographic area, or too great a range of activities, it shall be
interpreted to extend only over the maximum period of time, geographic area, or
range of activities as to which it may be enforceable. For purposes of this
Section 6, the term "Employer" shall mean L.S. Wholesale, Inc. and any of its
subsidiaries, affiliates, predecessors and successors.
7. Conflicting Agreements. The Executive hereby represents and warrants
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that the execution of this Agreement and the performance of his obligations
hereunder will not breach or be in conflict with any other agreement to which he
is a party or is bound, and that he is not now subject to any covenants against
competition or similar covenants which would affect the performance of his
obligations hereunder.
8. Definition of "Person". For purposes of this Agreement, the term
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"Person" shall mean an individual, a corporation, an association, a partnership,
an estate, a trust and any other entity or organization.
9. Taxation of Payments and Benefits.
---------------------------------
a. The Employer shall undertake to make deductions, withholdings
and tax reports with respect to payments and benefits under this Agreement to
the extent that it reasonably and in good faith believes that it is required to
make such deductions, withholdings and tax reports. All payments made by the
Employer under this Agreement shall be net of any tax or other amounts required
to be withheld by the Employer under applicable law. Nothing in this Agreement
shall be construed to require the Employer to make any payments to compensate
the Executive for any adverse tax effect associated with any payments or
benefits or for any deduction or withholding from any payment or benefit.
b. Notwithstanding the foregoing, the Employer shall pay to the
Executive an additional payment (the "Gross-up Payment") for otherwise taxable
reimbursements made to the Executive under Section 3.c. of this Agreement,
provided that the Employer shall use its standard gross-up methodology in
calculating the Gross-up Payment to be paid to the Executive. Under the
Employer's standard gross-up methodology, the Employer makes a taxable payment
equivalent to the Employer's reasonable estimate of the Executive's federal,
state and any local income taxes and the Executive's FICA taxes on the amount to
be grossed up.
10. Arbitration of Disputes. Any controversy or claim arising out of or
-----------------------
relating to this Agreement or the breach thereof or otherwise arising out of the
Executive's employment or the termination of that employment (including, without
limitation, any claims of unlawful employment discrimination whether based on
age or otherwise) shall, to the fullest extent permitted by law, be settled by
arbitration in any forum and form agreed upon by the parties or, in the absence
of such an agreement, under the auspices of the American Arbitration Association
("AAA") in Boston, Massachusetts in accordance with the Employment Dispute
Resolution Rules of the AAA, including, but not limited to, the rules and
procedures applicable
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to the selection of arbitrators. Judgment upon the award rendered by the
arbitrator may be entered in any court having jurisdiction thereof. This Section
10 shall be specifically enforceable. Notwithstanding the foregoing, this
Section 10 shall not preclude either party from pursuing a court action for the
sole purpose of obtaining a temporary restraining order or a preliminary
injunction in circumstances in which such relief is appropriate; provided,
however, that any other relief shall be pursued through an arbitration
proceeding pursuant to this Section 10.
11. Assignment: Successors and Assigns. Neither the Employer nor the
-----------------------------------
Executive may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; provided, however, that the Employer may assign its rights under this
Agreement without the consent of the Executive in the event that the Employer
shall hereafter effect a reorganization, consolidate with or merge into any
other Person, or transfer all or substantially all of its properties or assets
to any other Person. This Agreement shall inure to the benefit of and be binding
upon the Employer and the Executive, their respective successors, executors,
administrators, heirs and permitted assigns.
12. Enforceability. If any portion or provision of this Agreement shall to
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any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.
13. Waiver. No waiver of any provision hereof shall be effective unless
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made in writing and signed by the waiving party. The failure of any party to
require the performance of any term or obligation of this Agreement, or the
waiver by any party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.
14. Notices. All notices, requests, demands and other communications
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provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by registered or certified mail, postage prepaid, to the
Executive at the last address the Executive has filed in writing with the
Employer or, in the case of the Employer, at its main offices, attention of the
Board of Directors. Any such notice shall be deemed to be effective and
therefore given upon the following dates: (i) if such notice is delivered in
person the date on which such delivery is done; or (ii) if such notice is sent
by registered or certified mail, postage prepaid, the date which is three (3)
days subsequent to the date on which such notice is mailed.
15. Amendment. This Agreement may be amended or modified only by a written
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instrument signed by the Executive and by a duly authorized representative of
the Employer.
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16. Governing Law: Consent to Jurisdiction. It is the parties' intention
---------------------------------------
that the terms of employment under this Agreement shall be construed under and
be governed in all respects by the laws of the Commonwealth of Massachusetts. To
the extent that any court action is permitted consistent with or to enforce
Section 10 of this Agreement, the parties hereby consent to the jurisdiction of
the Superior Court of the Commonwealth of Massachusetts and the United States
District Court for the District of Massachusetts. Accordingly, with respect to
any such court action, the Employer and Executive (a) submit to the personal
jurisdiction of such courts and (b) consents to service of process.
17. Counterparts. This Agreement may be executed in any number of
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counterparts, each of which when so executed and delivered shall be taken to be
an original, but such counterparts shall together constitute one and the same
document.
[END OF TEXT]
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IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument by
each of the Employer and Little Switzerland, by their duly authorized officers
and/or directors, and by the Executive, as of the date first above written.
L.S. WHOLESALE, INC.
By: /s/ William K. Canfield
-----------------------
Name: William K. Canfield
Title: Vice President
LITTLE SWITZERLAND, INC.
By: /s/ Kenneth W. Watson
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Name: Kenneth W. Watson
Title: Director
By: /s/ John E. Toler, Jr.
----------------------
Name: John E. Toler, Jr.
Title: Director
By: /s/ Timothy B. Donaldson
------------------------
Name: Timothy B. Donaldson
Title: Director
Dated: January 21,1999 By: /s/ Adriane J. Dudley
--------------- ---------------------
Name: Adriane J. Dudley
Title: Director
EXECUTIVE:
/s/ C. William Carey
--------------------
C. William Carey
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Exhibit 10.30
NON-QUALIFIED STOCK OPTION AGREEMENT
------------------------------------
Name of Optionee: C. William Carey
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No. Of Option Shares: 150,000 Grant Date: September 1, 1998
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Option Exercise Price: $2.25 Expiration Date: September 1, 2008
--------- -----------------
Little Switzerland, Inc., a Delaware corporation (the "Company"), hereby
grants to the Optionee named above, who is now employed by the Company, an
option ("Stock Option") to purchase on or prior to the expiration date of this
Stock Option specified above (the "Expiration Date") all or any part of the
number of shares of common stock, par value $0.01 per share, (the "Common
Stock") of the Company specified above (the "Option Shares") at the per share
Stock Option exercise price specified above, subject to the terms and conditions
set forth herein. This Stock Option is not intended to qualify as an "incentive
stock option" under Section 422(b) of the Internal Revenue Code of 1986, as
amended from time to time (the "Code").
1. Vesting Schedule.
----------------
(a) No portion of this Stock Option may be exercised until such
portion shall have vested. Except as set forth below, and subject to the
determination of the Board of Directors of the Company in its sole and absolute
discretion to accelerate the vesting schedule
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<PAGE>
hereunder, this Stock Option shall be vested and exercisable with respect to the
following number of Option Shares on the dates indicated:
<TABLE>
<CAPTION>
Cumulative Number of
---------------------
Option Shares Exercisable Vesting Date
------------------------- ------------
<S> <C>
30,000 September 1, 1998
60,000 September 1, 1999
90,000 September 1, 2000
120,000 September 1, 2001
150,000 September 1, 2002
</TABLE>
In any event this Stock Option shall become fully vested and exercisable
with respect to all of the Option Shares on September 1, 2002. Once vested, this
Stock Option shall continue to be exercisable at any time or times prior to the
Expiration Date, subject to the provisions hereof.
(b) In the event the Optionee's Directorship (as defined in Section
3(a) hereof) terminates for any reason other than his failure to be re-elected
to his position as a member of the Board of Directors of the Company at the next
annual stockholders' meeting or special meeting in lieu thereof, only those
Stock Options that have vested prior to such termination shall be exercisable by
the Optionee.
(c) In the event that the Optionee is not re-elected as a member of
the Board of Directors of the Company at the next annual stockholders' meeting
or special meeting in lieu thereof or of a "change in control" (as defined
below) of the Company, all Stock Options then outstanding granted to the
Optionee shall become fully vested and immediately exercisable.
2
<PAGE>
(d) For purposes of this Agreement, a "change of control" shall be
deemed to have occurred in the following instances: (i) if there has occurred a
change in control which the Company would be required to report in response to
Item 6(e) of Schedule 14A promulgated under the Securities Exchange Act of 1934,
as amended (the "1934 Act"), or, if such regulation is no longer in effect, any
regulations promulgated by the Securities and Exchange Commission pursuant to
the 1934 Act which are intended to serve similar purposes; (ii) when any
"person" (as such term is used in Section 13(d) and 14(d)(2) of the 1934 Act)
becomes a "beneficial owner" (as such term is defined in Rule 13d-3 promulgated
under the 1934 Act), directly or indirectly, of securities of the Company
representing twenty percent (20 %) or more of the total number of votes that may
be cast for the election of Directors of the Company; (iii) the sale, transfer
or other disposition of all or substantially all of the assets of the Company to
another person or entity; (iv) the election of Directors of the Company equal to
one-third or more of the total number of Directors then in office who have not
been nominated by the Company's Board of Directors or a committee thereof; or
(v) the signing of an agreement, contract or other arrangement providing for any
of the transactions described above in this definition of change of control. If
the Optionee is a Director or officer of Company he shall not be deemed, solely
as a result of his position as Director or officer of the Company, to be the
beneficial owner of any securities of the Company that are beneficially owned by
any other Director or officer of the Company.
3
<PAGE>
2. Exercise of Stock Option.
------------------------
(a) The Optionee may exercise only vested portions of this Stock
Option and only in the following manner: Prior to the Expiration Date, the
Optionee may give written notice on any business day to the Board of Directors
of the Company (the "Board of Directors") of his election to purchase some or
all of the shares purchasable at the time of such notice. Said notice shall
specify the number of shares to be purchased and shall be accompanied (i) by
payment therefor in cash or, at the Optionee's election, in shares of Common
Stock of the Company having a fair market value (as determined below) on the
date of exercise equal to or less than the total option exercise price, plus
cash, in an amount equal to the amount, if any, by which the total option
exercise price exceeds the fair market value of such shares of Common Stock, and
(ii) by such agreement, statement or other evidence as the Company may require
in order to satisfy itself that the issuance and conveyance of the shares being
purchased pursuant to such exercise and any subsequent resale thereof will be in
compliance with applicable laws and regulations, including, without limitation,
all federal and state securities laws.
(b) Certificates for the shares so purchased will be issued and
delivered to the Optionee upon compliance to the reasonable satisfaction of the
Company with all requirements under applicable laws or regulations in connection
with such issuance. Until the Optionee shall have complied with the requirements
hereof, the Company shall be under no obligation to issue the shares subject to
this Stock Option, and the determination of the Board of Directors (exclusive of
the Optionee) as to such compliance shall be final and binding on the Optionee.
The Optionee shall not be deemed to be the holder of, or to have any of the
rights of a holder with respect to, any shares of Common Stock subject to this
Stock Option unless and until this Stock Option shall have been exercised
pursuant to the terms hereof, the Company
4
<PAGE>
shall have issued and delivered the shares to the Optionee, and the Optionee's
name shall have been entered as a stockholder of record on the books of the
Company. Thereupon, the Optionee shall have full voting, dividend and other
ownership rights with respect to such shares of Common Stock.
(c) The minimum number of shares with respect to which this Stock
Option may be exercised at any one time shall be 100 shares, unless the number
of shares with respect to which this Stock Option is being exercised is the
total number of shares subject to exercise under this Stock Option at the time.
(d) Notwithstanding any other provision hereof, no portion of this Stock Option
shall be exercisable after the Expiration Date.
(d) Notwithstanding any other provision hereof, no portion of this
Stock Option shall be exercisable after the Expiration Date.
(e) For purposes of this Agreement, the fair market value of the
Common Stock shall be determined in good faith by the Board of Directors
(exclusive of the Optionee), provided, however, that (x) if the Common Stock is
admitted to quotation on the National Association of Securities Dealers
Automated Quotation System on the date the Stock Option is granted, fair market
value shall not be less than the average of the highest bid and lowest asked
prices of the Common Stock on such date or on the last preceding date on which a
sale was reported, or if the Common Stock is admitted to trading on the National
Association of Securities Dealers Automated Quotation National Market System on
the date the Stock Option is granted, fair market value shall not be less than
the closing price reported for the Common Stock on such National Market System
on such date or on the last preceding date on which a sale was reported, or
(y) if the Common Stock is admitted to trading on a national securities exchange
on the date the Stock Option is granted, fair market value shall not be less
than the last sale price reported for the Common Stock on such exchange on such
date or on the last date preceding such date on which a sale was reported.
5
<PAGE>
3. Termination of Directorship.
---------------------------
(a) If the Optionee's membership on the Board of Directors of the
Company (the "Directorship") terminates by reason of his death or disability,
this Stock Option may thereafter be exercised, to the extent it was exercisable
on the date of such termination, until the earlier of (i) one year from the date
of such termination or (ii) the Expiration Date.
(b) If the Optionee's Directorship terminates by reason of his failure
to be re-elected to his position as a member of the Board of Directors of the
Company, this Stock Option may thereafter be exercised until the earlier of (i)
two years from the date of the annual meeting in which the Optionee failed to be
re-elected as a member of the Board of Directors of the Company or (ii) the
Expiration Date.
(c) If the Optionee's Directorship terminates by reason of cause, this
Stock Option shall lapse immediately upon the effective date of such termination
and shall not be exercisable at any time thereafter. Only the following shall
constitute "cause" for termination: (i) deliberate dishonesty of the Optionee
with respect to the Company or any subsidiary or affiliate thereof;
(ii) conviction of the Optionee of a crime involving moral turpitude;
(iii) material failure to perform a substantial portion of the Optionee's duties
and responsibilities with respect to the Company or any subsidiary or affiliate
thereof, which failure continues for more than thirty (30) days after written
notice given to the Optionee pursuant to a two-thirds vote of all of the members
of the Board of Directors of the Company, such vote to set forth in reasonable
detail the nature of such failure; or (iv) gross or willful misconduct of the
Optionee with respect to the Company or any subsidiary or affiliate.
6
<PAGE>
(d) If the Optionee's Directorship is terminated for any reason other
than death, disability, failure to be re-elected as a Director of the Company or
cause, this Stock Option may thereafter be exercised, to the extent it was
exercisable on the date of such termination, until the earlier of (i) ninety
(90) days following such termination or (ii) the Expiration Date. (e) The Board
of Directors (exclusive of the Optionee) shall have sole discretion to determine
in good faith the reason for the termination of the Optionee's Directorship with
the Company.
4. Transferability. This Agreement is personal to the Optionee and is
---------------
not transferable by the Optionee in any manner other than by will or the laws of
descent and distribution or pursuant to a qualified domestic relations order as
defined by the Code, or Title I of the Employee Retirement Income Security Act,
as amended, or the rules thereunder; provided, however, that the designation of
a beneficiary by the Optionee does not constitute a transfer. Options may be
exercised during the Optionee's lifetime only by the Optionee.
5. Restrictions on Issuance of Option Shares. The issuance of Option
-----------------------------------------
Shares upon exercise thereof shall be subject to compliance with all of the
applicable laws, rules and regulations, including all applicable federal and
state securities laws, and the obtaining of all such approvals by governmental
agencies as may be deemed necessary or appropriate by the Board of Directors of
the Company.
7
<PAGE>
6. Adjustment Upon Changes in Capitalization.
-----------------------------------------
(a) The shares of stock covered by this Stock Option are shares of the
Common Stock of the Company. If the shares of the Company's Common Stock as a
whole are increased, decreased, changed into or exchanged for a different number
or kind of shares or securities of the Company, whether through merger,
consolidation, reorganization, recapitalization, reclassification, stock
dividend, stock split, combination of shares, exchange of shares, change in
corporate structure or the like, an appropriate and proportionate adjustment
shall be made in the number and kind of shares, and the per share exercise price
of shares subject to any unexercised portion of this Stock Option. In the event
of any such adjustment in this Stock Option, the Optionee thereafter shall have
the right to purchase the number of shares under this Stock Option at the per
share price, as so adjusted, which the Optionee could purchase at the total
purchase price applicable to this Stock Option immediately prior to such
adjustment. Adjustments under this Paragraph 6 shall be made by the Board of
Directors (exclusive of the Optionee) of the Company. No fractional shares of
Common Stock shall be issued on account of any adjustment specified above.
7. Effect of Certain Transactions. In the case of (a) the dissolution or
------------------------------
liquidation of the Company, (b) a merger, reorganization or consolidation in
which the Company is acquired by another person or in which the Company is not
the surviving corporation, or (c) the sale of all or substantially all of the
assets of the Company to another corporation, this Stock Option shall terminate
on the effective date of such dissolution, liquidation, merger, reorganization,
consolidation or sale, unless provision is made in such transaction for the
assumption of this Stock Option or the substitution for this Stock Option of a
new Stock Option of the successor
8
<PAGE>
employer corporation or a parent or subsidiary thereof, with appropriate
adjustment as to the number and kind of shares and the per share exercise price,
as provided in Paragraph 6. In the event of such a termination, the Optionee
will receive written notice thereof at least twenty (20) days prior to the
effective date of such transaction.
8. Tax Withholding.
---------------
(a) The Optionee, no later than the date as of which the value of any
Common Stock first becomes includable in the gross income of the Optionee for
federal income tax purposes, shall pay to the Company, or make arrangements
satisfactory to the Board of Directors regarding payment of any federal, state
or local taxes of any kind required by law to be withheld with respect to such
income. The Company shall, to the extent permitted by law, have the right to
deduct any such taxes from any payment of any kind otherwise due to the
Optionee.
(b) The Optionee may elect to have such tax withholding obligation
satisfied, in whole or in part, by:
(i) authorizing the Company to withhold from shares of Common
Stock to be issued pursuant to the Stock Option a number of shares with an
aggregate fair market value that would satisfy the withholding amount due, or
(ii) transferring to the Company shares of Common Stock owned by
the Optionee with an aggregate fair market value that would satisfy the
withholding amount due. While the Optionee is a director or officer of the
Company within the meaning of Section 16(b) of the 1934 Act, the following
additional restrictions shall apply: (1) the election to satisfy tax withholding
obligations relating to the Stock Option in the manner permitted by this
9
<PAGE>
Section 8(b)(ii) shall be made either (A) during the period beginning on the
third business day following the date of release of quarterly or annual summary
statements of sales and earnings of the Company and ending on the twelfth
business day following such date, or (B) irrevocably at least six months prior
to the date as of which the receipt of such Common Stock first becomes a taxable
event for federal income tax purposes; and (2) such election shall not be made
within six months of the date of grant of the option.
9. Amendment. This Agreement may be amended or modified only by a
---------
written instrument signed by the Optionee and a duly authorized representative
of the Company.
10. Governing Law. This Agreement shall be governed by the laws of the
-------------
State of Delaware, except to the extent that such law is preempted by federal
law.
10
<PAGE>
11. Miscellaneous. Notice hereunder shall be mailed or delivered to the
-------------
Company at its principal place of business, and shall be mailed or delivered to
the Optionee at the address set forth below, or in either case at such other
address as one party may subsequently furnish to the other party in writing.
LITTLE SWITZERLAND, INC.
By: /s/ Kenneth W. Watson
---------------------
Name: Kenneth W. Watson
Title: Director
By: /s/ John E. Toler, Jr.
----------------------
Name: John E. Toler, Jr.
Title: Director
By: /s/ Timothy B. Donaldson
------------------------
Name: Timothy B. Donaldson
Title: Director
Dated: January 21, 1999 By: /s/ Adriane J. Dudley
---------------- ---------------------
Name: Adriane J. Dudley
Title: Director
11
<PAGE>
The foregoing Agreement is hereby accepted and the terms and conditions
thereof hereby agreed to by the undersigned.
/s/ C. William Carey
--------------------
C. William Carey
Optionee's Address:
--------------------
St. Thomas, U.S.V.I.
--------------------
12
<PAGE>
Exhibit 10.31
SUCCESS FEE AGREEMENT
---------------------
This SUCCESS FEE AGREEMENT, made as of January 15, 1999 (this "Agreement"),
by and between Little Switzerland, Inc., a Delaware corporation with its main
office in St. Thomas, U.S.V.I. (the "Company"), and C. William Carey (the
"Director").
WITNESSETH
WHEREAS, the Board of Directors of the Company has terminated the
Investment Banking Committee of the Board of Directors of the Company (the
"Committee"), of which the Director was a member;
WHEREAS, the parties hereto entered into a Success Fee Agreement on
February 4, 1998 (the "Original Agreement"), relating to a success fee equal to
two-thirds of one percent (1%) of the aggregate value of certain transactions
entered into and completed by the Company;
WHEREAS, the parties hereto previously determined that the Original
Agreement has been terminated; and
WHEREAS, the parties hereto now desire to enter into a new arrangement with
respect to the Success Fee.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants contained herein, the Company and the Director mutually agree as
follows:
1. Payment of Success Fee. The Director hereby agrees to actively
----------------------
participate, through duties and responsibilities assigned to the Director by the
Board of Directors of the Company, in the negotiation, structuring and closing
of a transaction or a series of related transactions, if any, approved by the
Board of Directors of the Company which are a tender or exchange offer, merger,
reorganization, consolidation or other business combination that directly result
in the sale or other disposition of all or substantially all of the assets of
the Company or a sale of all or substantially all of the issued and outstanding
stock of the Company (a "Transaction"). Subject to Section 3 hereof, for
compensation for all of such services rendered by the Director in connection
with such Transaction, the Company shall pay the Director an amount equal to
eighty three and one-third percent (83 1/3%) of two-thirds of one percent (1%)
of the Aggregate Value (as defined in Section 2 hereof) of the Transaction (the
"Success Fee") by wire transfer of immediately available funds to an account
designated by the Director on the closing date (the "Effective Time") of such
Transaction. Notwithstanding anything to the contrary contained herein, the
Company shall be obligated to pay such Success Fee only if the Director is
either employed by the Company or is a member of the Board of Directors of the
Company at the Effective Time of a Transaction; provided, however, that the
-------- -------
<PAGE>
Company shall be obligated to make such payment to the Director if the Effective
Time occurs within three (3) months of the date on which the Director ceases to
neither be an employee nor a Director of the Company, unless such occurrence is
due to the Director's resignation as an employee or member of the Board of
Directors of the Company, as applicable, in which case no payment hereunder
shall be due the Director.
2. Aggregate Value. For purposes of this Agreement, the term "Aggregate
---------------
Value" shall mean the total amount of cash and the fair market value (on the
date of payment) of all other property paid or payable, directly or indirectly,
by the acquiring party (the "Acquiror") to the acquired party or the seller of
the acquired business (the "Acquired"), or to the Acquired's security holders or
its employees, or by the Acquired to the Acquired's security holders, in
connection with a Transaction (including, without limitation, amounts paid by
the Acquiror to holders of any warrants, stock purchase rights, convertible
securities or similar rights of the Company and to holders of any options or
stock appreciation rights issued by the Company, whether or not vested).
Aggregate Value shall also include the value of any long-term liabilities
(including the short-term portion thereof) of the Company (including the
principal amount of any indebtedness for borrowed money) indirectly or directly
assumed or acquired by the Acquiror, or otherwise repaid or retired, in
connection with or in anticipation of a Transaction. In the event the
Transaction takes the form of a recapitalization or restructuring of the Company
(including, without limitation, through negotiated repurchases of its
securities, an issuer tender offer, an extraordinary dividend, a spin-off,
split-off or similar transaction), Aggregate Value shall also include the fair
market value of (i) the equity securities of the Company retained by the
Company's security holders following such Transaction and (ii) any cash,
securities (including securities of subsidiaries) or other consideration
received by the Company's security holders in exchange for or in respect of
securities of the Company in connection with such Transaction (all such cash,
securities or other consideration received by such security holders being deemed
to have been paid to such security holders in such Transaction). If a
Transaction takes the form of a sale of assets, Aggregate Value shall also
include (i) the value of any current assets not sold, minus (ii) the value of
any current liabilities not assumed by the Acquiror. In the event that any part
of the consideration in connection with a transaction will be payable (whether
in one payment or a series of two or more payments) at any time following the
consummation thereof, the term Aggregate Value shall include the present value
of such future payment of payments. As used in this Agreement, the terms
"payment," "paid" or "payable" shall be deemed to include, as applicable, the
issuance or delivery of securities or other property other than cash.
3. Director Sponsored Transaction. Notwithstanding anything to the
------------------------------
contrary contained herein, the Company shall not be obligated to pay the Success
Fee to the Director if the Transaction involves any person, company or entity
(i) that is operated by the Director, (ii) for which the Director is performing
or has performed, in the twelve (12) months preceding the execution of the
definitive documents relating to the Transaction, any material advisory or
consulting services, (iii) that employs the Director or (iv) in which the
Director owns or has an
2
<PAGE>
agreement to own more than an one percent (1%) equity interest in a privately-
held corporation or a five percent (5%) equity interest in a publicly-held
corporation.
4. Satisfaction of the Company's Obligations; Interest. The Company and
---------------------------------------------------
the Director agree that the payment provided for in Section 1 hereof shall
satisfy in full the Company's obligation to pay the Success Fee to the Director
with respect to the services rendered by the Director in connection with this
Agreement. Notwithstanding the foregoing, in the event that the Company shall
fail to pay the Success Fee when due, the term "Success Fee" shall be deemed to
include interest on such unpaid Success Fee, commencing on the Effective Time,
at a rate per annum equal to the rate of interest publicly announced by
Citibank, N.A., from time to time, in the City of New York, as such bank's Prime
Rate.
5. Legal Fees. If legal action is commenced by the Director to enforce
----------
his rights under this Agreement, the Director shall be entitled to recover any
and all costs incurred in connection with the enforcement of his rights
hereunder or the collection of the Success Fee, including, without limitation,
reasonable attorney's fees, in addition to any other relief granted.
6. Binding Effect; Assignment. This Agreement shall inure to the benefit
--------------------------
of and be binding upon the Company and the Director, their respective
successors, executors, administrators, heirs and permitted assigns. The
Director shall have no right to assign this Agreement. The Company may assign
this Agreement only with the consent of the Director.
7. Amendment. This Agreement may be amended or modified only by a
---------
written instrument signed by the Director or a duly authorized representative of
the Director and the Company.
8. Termination. If the Effective Time has not occurred by the first
-----------
anniversary of the date first written above (the "Termination Date"), then this
Agreement shall automatically terminate on such Termination Date and all of the
Company's obligations hereunder shall cease as of such Termination Date.
9. Counterparts. This Agreement may be executed in one or more
------------
counterparts, all of which documents shall be considered one and the same
document.
10. Governing Law; Consent to Jurisdiction. It is the parties' intention
--------------------------------------
that this Agreement shall be construed under and be governed in all respects by
the laws of the State of Delaware. Each of the Company and the Director hereby
irrevocably and unconditionally consent to the jurisdiction of the courts of the
State of Delaware and the United States District Court for the District of
Delaware for any action, suit or proceeding arising out of or relating to this
Agreement, and agrees not to commence any action, suit or proceeding related
thereto except in such courts. Each of the Company and the Director further
hereby irrevocably and unconditionally waive any objection to the laying of
venue of any lawsuit, claim or other proceeding arising out of or relating to
this Agreement in the courts of the State of Delaware or the United States
District Court for the District of Delaware, and hereby further irrevocably and
3
<PAGE>
unconditionally waive and agree not to plead or claim in any such court that any
such lawsuit, claim or other proceeding brought in any such court has been
brought in an inconvenient forum.
IN WITNESS WHEREOF, this Agreement has been executed by the Company, by its
duly authorized directors, and by the Director, as of the date first above
written.
LITTLE SWITZERLAND, INC.
By: /s/ Kenneth W. Watson
---------------------
Name: Kenneth W. Watson
Title: Director
By: /s/ John E. Toler, Jr.
---------------------- -
Name: John E. Toler, Jr.
Title: Director
By: /s/ Timothy B. Donaldson
------------------------ -
Name: Timothy B. Donaldson
Title: Director
By: /s/ Adriane J. Dudley
-----------------
Name: Adriane J. Dudley
Title: Director
DIRECTOR:
/s/ C. William Carey
--------------------
C. William Carey
4
<PAGE>
Exhibit 99.1
PRESS RELEASE
CONTACTS:
- --------
C. William Carey
Little Switzerland, Inc.
(340) 776-2010
Mary Ellen Goodall
Walter Denby
D.F. King & Co., Inc.
(212) 269-5550
FOR IMMEDIATE RELEASE
- ---------------------
LITTLE SWITZERLAND ANNOUNCES SETTLEMENT OF LITIGATION
-----------------------------------------------------
WITH JEWELCOR
-------------
ST. THOMAS, U.S. VIRGIN ISLANDS, January 26, 1999.....Little Switzerland,
Inc. (NASDAQ:LSVI), today announced that it had entered into a settlement
agreement with Jewelcor Management, Inc. regarding the lawsuit it had brought
against Little Switzerland. This settlement agreement provides that Jewelcor
will dismiss its lawsuit seeking an order requiring the election of four
directors at the next annual meeting of stockholders of Little Switzerland.
It also provides that Jewelcor will not contest the Company's annual meeting
date of February 25, 1999, the record date of January 8, 1999 and the nomination
and proposal date of December 28, 1998. Further, Jewelcor has agreed not to
challenge the decision by the Board of Directors of Little Switzerland to fix
the number of directors at four and the decision that two of the four directors
will be subject to election at the annual meeting. Little Switzerland has agreed
to reimburse Jewelcor for legal fees and expenses it incurred in this lawsuit up
to $18,500.
Little Switzerland, Inc. is a leading specialty retailer of brand name
watches, jewelry, crystal, china, fragrances and accessories, operating
23 stores on nine Caribbean islands, and two stores in Alaska cruise ship
destinations. The Company's primary market consists of vacationing tourists
attracted by free-port pricing, duty-free allowances and a wide variety of high
quality merchandise.
