Employment Agreement - Berlitz International Inc. and Anthony Tedesco
June 15, 1993
Mr. Anthony Tedesco
293 Wall Street
Princeton, NJ 08540
Dear Tony:
This letter agreement (the "Agreement") will constitute the
agreement relating to your employment as Vice President, Far East
of Berlitz International, Inc. ("BII"). As used herein the term
"Company" shall include BII and its subsidiaries. Any amounts
payable and the manner of payment shall be determined by agreement
between you and the Company.
1. Employment. Your employment under this Agreement
shall commence July 1, 1, 1993 and be for a term of between one and
one-half years to a maximum of two years. You will relocate to
Tokyo, Japan and the Company will pay your moving expenses in
accordance with BII's moving expense policy for executives. Upon
completion of your service as BII Vice President, Far East, you will
continue as an executive officer of BII, in a position no lower than
Regional Vice President of BII and be relocated and paid your moving
expenses in accordance with BII's above moving expense policy.
Among your other duties as Vice President, Far East of BII,
we expect that you will concentrate your efforts on the following
major goals (i) increase sales by more actively pursuing group lessons
in Japan, (ii) increase EBIT by appropriate means with special
emphasis upon reducing teachers salaries as a percentage of sales, and
(iii) employ with the approval of the Executive Committee your
successor and train your successor as BII Vice President, Far East, so
that your successor can assume his position no later than July 1,
1995.
2. Compensation. During the period you serve as Vice
President, Far East of BII,
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you will receive a gross salary of $75,000 payable $6,250 per month
commencing on July 17, 1993, and you will be eligible to participate
in BII's Short-Term Executive Incentive Compensation Plan (the
"Plan"), as the same may be modified from time to time. Upon your
return from Japan, your salary will be adjusted to the amount which
would have been applicable had you continuously served as BII Vice
President/North America. You shall also participate in all of BII's
employee benefit plans, policies and programs provided to its
executives including, but not limited to, health and life insurance
policies, disability programs, pension plans, 401K plans, BII's
vacation program and the BII 1989 Stock Option and Incentive Plan
("Option and Incentive Plan"), in each instance as the same may be
modified by BII from time to time. In lieu of participating in BII's
health and retirement plans, you may elect to participate in the health
and retirement plans of The Berlitz Schools of Languages of (Japan),
Inc. Your salary shall be prorated for any period of less than one
month.
3. Termination.
(a) Death. In the event of your death, your
employment and the obligations of the Company under this
Agreement shall cease and terminate, but the amount of any
compensation accrued and due and payable hereunder calculated
through to the last day of the month in which your death occurs shall
be paid to your heirs and legal representatives.
(b) Disability. In the event you become
substantially unable to perform your duties hereunder as a result of
illness or other disability which renders you unfit or incapable of
performing such duties, and such disability or incapacity continues for
120 consecutive days or a period of 180 days in any twelve month
period, the Company shall have the right to terminate your
employment. In such event, the obligations of the Company under
this Agreement shall cease, provided that the Company gives you not
less than thirty days prior written notice specifying the termination
date. Upon such termination, you shall be paid the amount of any
compensation accrued and due and payable to you hereunder through
the date of such termination.
(c) Without Cause.
In the event you are involuntarily terminated
without Cause at any time while you are Vice President, Far East of
BII, or within two years from the date on which you
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cease to be Vice President, Far East of BII, the Company agrees to
pay you upon termination a lump sum severance amount equal to the
sum of two years salary payable to you under this Agreement, plus
your salary as a management employee of The Berlitz Schools of
Languages (Japan), Inc. ("Berlitz Japan"), payable in cash. If your
involuntary termination occurs while you are Vice President, Far East
of BII and a management employee of Berlitz Japan, your lump sum
severance amount shall be based upon the sum of the salaries you
were receiving as Vice President, Far East of BII and a management
employee of Berlitz Japan at the time of such involuntary termination.
If your involuntary termination occurs after you have ceased to be
Vice President, Far East of BII, your lump sum severance amount
shall be based upon the salary you were receiving after you ceased to
be Vice President, Far East of BII at the time of such involuntary
termination. You agree to deliver to the Company a release of all
claims consistent with the Company's past practice.
In addition, if you are involuntarily terminated
without Cause, to the extent such continued participation is
permissible under the general terms and conditions of such plans or
programs, you shall also have the right to continue to participate in
all health insurance, life insurance, pension, 401K, and disability
plans or programs of BII, for the earlier of the period ending two
years from the date of your termination, or the date on which you
obtain new employment in a comparable position.
In the event you are involuntarily terminated
without Cause, all stock awards, including, without limitation,
restricted stock and stock options which may have been awarded to
you by BII pursuant to the Option and Incentive Plan, shall to the
extent not already vested become fully vested. Any such stock
options shall be exercisable for 90 days after your termination.
In the event you are involuntarily terminated
without Cause, you shall also be entitled to select executive
outplacement services as is customary for senior executives, the
reasonable cost of such services to be paid by the Company; provided
however, that your severance compensation payable to you hereunder
shall not be reduced by virtue of any obligation to seek other
employment.
(d) With Cause. In the event you are terminated with
Cause (as hereinafter defined) at any time, all obligations of the
Company under this Agreement shall cease and terminate on
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the last day of the month in which your termination with Cause
occurs.
4. Definitions. As used throughout this Agreement,
"Cause" shall mean (i) serious and repeated willful misconduct in
respect of your duties under this Agreement which has resulted in
material, economic damages to the Company, and, to the extent such
misconduct is susceptible to being cured, such misconduct continues
for thirty days following written notice to you detailing such
misconduct, all as determined by the Executive Committee or Board
of Directors of BII, (ii) the final, unappealable conviction in a court
of law of any crime or offense (A) for which you are imprisoned for
a term of six months or more or (B) that involves the commission of
fraud or theft against, or embezzlement from, the Company, or (iii)
chronic alcoholism or abuse of controlled substances.
5. Real Estate Matters. The Company agrees to
reimburse you for all documented costs and expenses incurred by you
in connection with your utilizing professional real estate managers to
rent and manage your personal and investment real estate owned by
you on the date of this Agreement. You agree to provide BII with a
list of all such real estate, indicating the addresses of all such real
estate.
6. Indemnification. To the extent permitted or required
by the laws of the State of New York or the By-Laws of BII, BII
shall indemnify and provide reasonable advances for expenses to you,
in accordance with the terms of such laws, if you are made a party,
or threatened to be made a party, to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that you are, or
were, an officer or director of BII or any subsidiary or affiliate of
BII, in which capacity you are, or were, serving at BII's best interest,
against expenses (including reasonable attorneys' fees), judgments,
fines and amounts in settlement actually and reasonably incurred by
you in connection with such action, suit or proceeding.
7. Enforcement. The Company agrees to pay reasonable
legal fees and expenses incurred by you in enforcing or defending any
of your rights under this Agreement, provided that you prevail in such
enforcement or defense.
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8. Confidentiality. You shall keep secret and retain in
strictest confidence, and shall not use for the benefit of yourself or
others, except in connection with the business and affairs of the
Company, all confidential matters of the Company, including, without
limitation, "know-how", trade secrets, consultant contracts, customer
lists, subscription lists, pricing policies, operational methods, market
plans or strategies, language development techniques or plans,
business acquisition plans, new personnel acquisition plans, designs
and design projects, research projects and other business affairs of the
Company learned by you heretofore or hereafter, and shall not
disclose them to anyone outside the Company, except as required in
the course of performing duties hereunder or with the Company's
express written consent. All memoranda, notes, lists, records and
other documents (and all copies thereof) made or compiled by you or
made available to you concerning the business of the Company shall
remain the Company's property and shall be delivered to the
Company promptly upon your termination.
9. Governing Law. This Agreement shall be governed by,
and construed and enforced in accordance with, the laws of the State
of New York applicable to agreements made and to be performed
entirely in New York, except that any matters pertaining to the Berlitz
Japan health and retirement plans shall be governed by the laws of
Japan.
10. Entire Agreement. This Agreement sets forth the entire
agreement and understanding of the parties relating to the subject
matter hereof, and supersedes all prior agreements, arrangements and
understandings, written or oral, relating to the subject matter hereof.
No representation, promise of inducement has been made by either
party that is not embodied in this Agreement, and neither party shall
be bound by, or liable for, any alleged representation, promise or
inducement not so set forth.
11. Assignment. This Agreement, and your rights and
obligations hereunder, may not be assigned by you.
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12. Amendments. This Agreement may be amended,
modified, superseded, cancelled, renewed or extended, and the terms
or covenants hereof may be waived, only by a written instrument
executed by both of the parties hereto.
13. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
Sincerely,
BERLITZ INTERNATIONAL, INC.
By:/s/ HIROMASA YOKOI
Name: Hiromasa Yokoi
Title: Vice Chairman and Chief Executive Officer
Berlitz International, Inc.
Accepted and Agreed to:
By:/s/ ANTHONY TEDESCO
Anthony Tedesco