EXHIBIT 10.1
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This AMENDED AND RESTATED EMPLOYMENT AGREEMENT is entered into as
of
April 10, 2008, by and between Bluefly, Inc., a Delaware
corporation (the
"Company"), and Bradford Matson ("Matson").
RECITALS
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1. Matson currently
serves as Chief Marketing Officer of the Company in
accordance with the terms and conditions of an Employment Agreement
dated as of
September 19, 2005 for a term set to expire on September 30, 2008
(the "Original
Agreement").
2. The Company and
Matson desire to amend and restate the Original
Agreement in its entirety to, among other things extend the term of
Matson's
employment and amend certain provisions related to his compensation
in
accordance with the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants contained
in
this Agreement, and other good and valuable consideration, the
receipt and
sufficiency of which are hereby acknowledged, the Company and
Matson agree as
follows:
1. TERM
----
The Company hereby agrees to employ Matson as Chief Marketing
Officer of
the Company, and Matson hereby agrees to serve in such capacity,
for a term
ending on March 31, 2011 (as the same may be earlier terminated
pursuant to the
terms of this Agreement, the "Employment Term"), upon the terms and
subject to
the conditions contained in this Agreement.
2. DUTIES
------
During the Employment Term, Matson shall serve as Chief
Marketing
Officer of the Company, and shall be responsible for the duties
attendant to
such office and such other managerial duties and responsibilities
with the
Company consistent with such office as may be reasonably assigned
from time to
time by the Chief Executive Officer and/or President of the
Company.
The principal location of Matson's employment shall be in the New
York
City vicinity (i.e., within a 20 mile radius), although Matson
understands and
agrees that he will be required to travel from time to time for
business
reasons. Matson shall diligently and faithfully perform his
obligations under
the Agreement and shall devote his full professional and business
time to the
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performance of his duties as Chief Marketing Officer of the Company
during the
Employment Term. Matson shall not, directly or indirectly, render
business
services to any other person or entity, without the consent of the
Company's
Chief Executive Officer.
3. BASE SALARY
-----------
For services rendered by Matson to the Company during the
Employment
Term, the Company shall pay him a base salary of $350,000 per year,
payable in
accordance with the standard payroll practices of the Company,
subject to annual
increases in the sole discretion of the Chief Executive Officer and
the
Company's Board of Directors, taking into account the financial and
operating
performance of the Company's business and divisions and a
qualitative assessment
of Matson's performance during such year.
4. BONUS
-----
During the Employment Term, Matson shall be eligible to receive a
bonus
set by the Compensation Committee of the Company's Board of
Directors (the
"Compensation Committee") in its sole discretion and based on such
factors as
the Compensation Committee deems appropriate. In the event that,
prior to
December 31, 2008, Matson opts to terminate his employment by
providing the
Company with 30 days' written notice of termination and an
effective termination
date occurring after December 31, 2008, he shall receive a bonus of
$116,555 as
part of the first regularly scheduled payroll of 2009 in lieu of
any other
bonuses that would have been paid to him for the 2008 year. In the
event that
Matson does not so terminate his employment he will be eligible to
receive a
bonus for the 2008 year as determined by the Compensation
Committee. All
bonuses shall be paid in accordance with the Company's standard
payroll
practices, net of any applicable withholding.
5. EXPENSE
REIMBURSEMENT AND PERQUISITES
-------------------------------------
a. During the Term of
this Agreement, Matson shall be entitled to
reimbursement of all reasonable and actual out-of-pocket expenses
incurred by
him in the performance of him services to the Company consistent
with corporate
policies, if any, provided that the expenses are properly accounted
for.
b. During each
calendar year of the Employment Term, Matson shall
be entitled to reasonable vacation with full pay in accordance with
they
Company's then-current vacation policies; provided, however, that
Matson shall
schedule such vacations at times convenient to the Company.
c. Matson shall be
entitled to participate in all health insurance
(National Oxford), dental insurance, long-term disability insurance
and other
employee benefit plans instituted by the Company from time to time
on the same
terms and conditions as other similarly
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situated employees of the Company, to the extent permitted by law.
In addition,
Matson shall be a covered officer under the Company's now existing
and any
future Directors and Officers liability policy.
d. During the term of
this Agreement, for the months from May 2008
through December 2008, the Company will pay for appropriate monthly
temporary
housing (up to a maximum of $9,500 per month). It is essential that
Matson
submit receipts directly to the Company on a monthly basis to be
reimbursed. In
addition, on a monthly basis, the Company will pay Matson a
"gross-up" bonus
such that the net amount retained by Matson after the payment of
any federal,
state or local income taxes (collectively, "Taxes") on such bonus
will be
sufficient to pay any Taxes due with respect to the Company's
reimbursement of
housing expenses pursuant to this Section 5(d).
6. NON-COMPETITION;
NON-SOLICITATION
---------------------------------
a. In consideration of
the offer of employment, severance benefits and
Options to be granted to Matson hereunder, and for other good
and
valuable consideration, the receipt and sufficiency of which are
hereby
acknowledged, during the Non-Competition Term, Matson shall
not,
without the prior written consent of the Company, anywhere in
the
world, directly or indirectly, (i) enter into the employ of or
render
any services to any Competitive Business; (ii) engage in any
Competitive Business for his own account; (iii) become associated
with
or interested in any Competitive Business as an individual,
partner,
shareholder, creditor, director, officer, principal, agent,
employee,
trustee, consultant, advisor or in any other relationship or
capacity;
(iv) employ or retain, or have or cause any other person or entity
to
employ or retain, any person who was employed or retained by
the
Company while Matson was employed by the Company; or (v)
solicit,
interfere with, or endeavor to entice away from the Company, for
the
benefit of a Competitive Business, any of its customers or
other
persons with whom the Company has a contractual relationship.
For
purposes of this Agreement, a "Competitive Business" shall mean
any
person, corporation, partnership, firm or other entity which sells
or
has plans to sell ten (10) or more brands of luxury or high-end
designer apparel and/or fashion accessories at prices that are
consistently discounted to manufacturer's suggested retail
prices.
However, nothing in this Agreement shall preclude Matson from
investing
his personal assets in the securities of any corporation or
other
business entity which is engaged in a Competitive Business if
such
securities are traded on a national stock exchange or in the
over-the-counter market and if such investment does not result in
him
beneficially owning, at any time, more than three percent (3%) of
the
publicly-traded equity securities of such Competitive Business.
For
purposes of this agreement, the "Non-Competition Term" shall mean
a
period beginning upon the commencement of the Employment Term
and
ending on the two (2) year anniversary of the end of the
Employment
Term.
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b. Matson and the
Company agree that the covenants of non-competition
and non-solicitation contained in this paragraph 6 are
reasonable
covenants under the circumstances, and further agree that if, in
the
opinion of any court of competent jurisdiction, such covenants are
not
reasonable in any respect, such court shall have the right, power
and
authority to excise or modify such provision or provisions of
these
covenants as to the court shall appear not reasonable and to
enforce
the remainder of these covenants as so amended. Matson agrees that
any
breach of the covenants contained in this paragraph 6 would
irreparably
injure the Company. Accordingly, Matson agrees that the Company,
in
addition to pursuing any other remedies it may have in law or
in
equity, may obtain an injunction ag
