Employment Agreemenet - Bernard Chaus Inc. and Gregory Mongno
BERNARD CHAUS, INC.
530 Seventh Avenue
New York, New York 10018
October 15, 2003
Mr. Gregory Mongno
c/o Bernard Chaus, Inc.
530 Seventh Avenue
New York, New York 10018
Dear Mr. Mongno,
Reference is hereby made to the employment letter agreement (the
"Agreement"), dated as of June 1, 2001 by and between you and Bernard Chaus,
Inc. (the "Company"). You and the Company hereby agree that the Agreement shall
be modified as follows:
The paragraph opposite the caption "Position" shall be deleted and the
following shall be inserted in its stead:
"President (reporting to the Chief Operating Officer). You
shall be responsible for special projects, including
assistance with customer relationships, as assigned by the
Chief Operating Officer from time to time. You shall devote
such business time and attention to the business and affairs
of the Company as necessary to satisfy your obligations for
special projects hereunder."
The paragraph with the caption "Automobile Allowance" shall be deleted,
effective as of October 31, 2003.
The paragraph opposite the caption "Benefits" shall be modified to add
the following at the end of such paragraph:
"The Company shall not provide benefits to you under the
Exec-U-Care medical reimbursement program for any period after
October 31, 2003. You shall continue to participate in all
other benefit programs, which are currently in place, that are
made available to officers of the Company generally."
The paragraphs opposite the caption "Termination Benefits" shall be
deleted and the following inserted in their stead:
"In the event your employment is terminated by the Company
without Cause prior to the end of the Term, you shall be paid,
in full satisfaction of your rights against the Company for
termination of your employment, monthly severance payments
equal to your monthly base salary of $50,000 through the end
of the Term of the Agreement. For the avoidance of doubt, you
shall not be entitled to
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any severance payments for a nonrenewal of the Agreement at
the end of the Term. Unless you shall have been terminated for
Cause, upon your acceptance of a position as employee
(including self-employment) or consultant with another entity,
prior to the end of the Term, your employment hereunder shall
be terminated (to the extent not theretofore terminated
pursuant to the preceding sentence) and you shall thereafter
be entitled to monthly severance payments for the remainder of
the Term equal to $50,000 less the amount of your monthly
compensation from any such other employment or consultancy.
For purposes of calculating the amount of your monthly
compensation from such other employment or consultancy, (i)
compensation shall include any payments attributable to the
severance period, whether or not paid during the severance
period, including any deferred compensation and the pro rated
portion of any guaranteed bonus or sign on bonus, and (ii) if
you enter into a compensation arrangement with escalating
compensation over a period exceeding the severance period,
your monthly compensation shall be the average monthly
compensation over the term of such compensation arrangement,
provided that escalating compensation reflecting year over
year increases of not more than 15% shall not require any such
averaging. You agree to provide immediate notice to the
Company of your acceptance of any such new position, including
a copy of the sections relating to compensation in any new
employment or consultant agreement (which sections may be
delivered "for the Company's "lawyers eyes only"), together
with a written representation that there are no other
agreements, arrangements or understandings relating to
compensation, with respect to such new employment or
consultancy. You hereby agree to use reasonable efforts to
obtain another position as employee or consultant. In the
event your employment is terminated by the Company without
Cause, you shall also be paid a bonus payment which shall be
equal to the pro rated portion of the bonus, if any, for the
year of termination as calculated in accordance with, and on
the time frame provided under, the "bonus" section above. If
you remain employed until the end of the Term, you shall be
entitled to the same bonus, if any, to which you would have
been entitled prior to this amendment to the Agreement. In the
event your employment is terminated due to Cause, your death
or a disability which prevents you from performing your duties
for three consecutive months or one hundred eighty (180) days
within any two year period, you shall be paid only through the
date of termination."
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An additional paragraph shall be added to the Agreement, to read as
follows:
"WAIVER OF CLAIMS FOR
DIMINISHED RESPONSIBILITY: You hereby agree to waive, and agree not to assert
in any forum, any claims you may have against the
Company for any diminishment in responsibility or
status that you may have whether prior to or
following the date of this amendment to the
Agreement. You further agree to waive and not to
assert in any forum any claim against the Company
for any matter arising from your employment
relationship with the Company prior to the date of
this amendment to the Agreement. The Company agrees
to waive, and not to assert in any forum, any claim
against you which it is aware of, for any matter
arising from your employment relationship with the
Company prior to the date of this amendment to the
Agreement. The Company represents that it is not
aware of any potential claim against you. Nothing
in this paragraph shall affect the right of either
party to enforce its rights under the Agreement for
any breach occurring on or after the date of this
Amendment to the Agreement."
Except as otherwise provided herein, the Agreement shall continue in
full force and effect.
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Please indicate your acceptance of the terms of this amendment to the
Agreement by your signature below. Once signed by both parties, this amendment
to the Agreement shall be binding on both parties.
Sincerely,
Bernard Chaus, Inc.
By: /s/ Nicholas DiPaolo
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Nicholas DiPaolo
Chief Operating Officer
Accepted and Agreed to
as of the date set forth above:
By: /s/ Gregory Mongno
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Gregory Mongno