Exhibit 10.7
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (this "Agreement") is made in New
York,
New York as of August 15, 2005 (the
"Effective Date"), by and between George
Foreman Ventures LLC, a Delaware limited
liability company (the "Company"), and
George Foreman III ("Employee").
WHEREAS, the Company desires to continue to employ Employee,
and
Employee desires to accept such continued
employment on the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements set forth herein,
and for other good and valuable
consideration, the receipt and sufficiency
of which are hereby acknowledged, the
parties, intending to be legally bound,
hereby agree as follows:
1.
Term.
Unless earlier terminated in accordance with Section 4 hereof,
the term of this Agreement shall be the
five-year period commencing on the
Effective Date and ending on the fifth
anniversary of the Effective Date (the
"Initial Term"). Thereafter, this Agreement
shall automatically be extended for
one or more additional five-year periods
unless Employee or the Company gives
written notice to the other party, not less
than one hundred twenty (120) days
prior to the end of the Initial Term or any
extension thereof (the Initial Term
and any and all extensions thereof,
collectively, the "Term"), of his or its
election not to renew this Agreement.
2.
Employment.
(a) Employment by the Company. During the Term, upon the terms
and subject to the conditions set forth in
this Agreement, Employee shall serve
as an Executive Vice President of the
Company, shall report solely to the Chief
Executive Officer of the Company (the
"CEO"), or, in the event of the CEO's
absence, the Board of Directors of the
Company (the "Board"), and shall serve as
an officer, director or manager of any
subsidiary of the Company, if elected to
any such position.
(b) Duties. Throughout the Term, Employee shall faithfully and
diligently perform Employee's duties and
responsibilities in conformity with the
directions of the CEO and the Board, shall
devote such time and effort as is
necessary to fulfill such duties and
responsibilities and shall serve the
Company to the best of Employee's ability.
Employee's duties shall include but
shall not be limited to coordinating
personal appearances and media interviews
by George Foreman, Sr., assisting the
Company in raising capital, meeting with
customers and business associates, and
assisting in development and
implementation of the Company's strategic
plan. Employee shall perform all
duties in a professional, ethical and
businesslike manner. In his capacity as an
Executive Vice President, Employee shall
have such duties and responsibilities
as are customary for Employee's position
and any other duties or
responsibilities he may be reasonably
assigned by the CEO or, in the event of
the CEO's absence, the Board.
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(c) Place of Performance. Employee shall be based in Houston,
Texas. Employee recognizes that his duties
will require, from time to time and
at the Company's expense, travel to
domestic and international locations in
accordance with the Company's standard
policies.
3.
Compensation and Benefits.
(a) Base Salary. The Company agrees to pay to Employee a
salary at the rate of $150,000 per annum
(the "Initial Base Salary"), payable in
installments consistent with the Company's
standard payroll policies, but in no
event less frequently than monthly. On
January 1 of each year during the Term,
(i) Employee's Base Salary (as hereinafter
defined) shall increase by five
percent (5%) and (ii) the Company shall
review Employee's performance and may
make such additional increases to the Base
Salary in its sole discretion. The
Initial Base Salary together with all such
mandatory and discretionary increases
thereto shall hereinafter be referred to as
the "Base Salary."
(b) Bonus. In addition, Employee shall be eligible for an
annual bonus at the sole discretion of the
Board, in accordance with and subject
to any written bonus plan developed and
approved by the Company applicable to
senior executives of the Company; provided
that such bonus shall be paid no
later than March 14 of the year following
the end of the year to which such
bonus relates.
(c) Benefits and Perquisites. Employee shall be entitled to
participate in, to the extent Employee is
otherwise eligible under the terms
thereof, the benefit plans and programs,
and receive the benefits and
perquisites, generally provided by the
Company to employees of the Company,
including without limitation family medical
insurance, health insurance and
disability insurance (in each case, subject
to applicable employee
contributions). Employee shall be entitled
to receive three weeks of annual paid
vacation. Employee shall receive holidays,
sick days and personal days pursuant
to the Company's standard policies.
(d) Business Expenses. The Company will reimburse Employee for
all reasonable and necessary business
expenses incurred by Employee in
connection with the performance of his
duties under this Agreement. Such
reimbursements will be made by the Company
on a timely basis upon submission by
Employee of reasonable documentation in
accordance with the Company's standard
policies.
(e) No Other Compensation or Benefits; Payment. The
compensation and benefits specified in this
Section 3 and in Section 5 of this
Agreement shall be in lieu of any and all
other compensation and benefits.
Payment of all compensation and benefits to
Employee specified in this Section 3
and in Section 5 of this Agreement (i)
shall be made in accordance with the
relevant Company policies in effect from
time to time to the extent the same are
consistently applied, including standard
payroll practices, and (ii) shall be
subject to all legally required and
customary withholdings.
(f) Cessation of Employment. In the event Employee shall cease
to be employed by the Company for any
reason, then Employee's compensation and
benefits shall cease on the date of such
event, except as otherwise specifically
provided herein or in any applicable
employee benefit plan or program or as
required by law.
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4.
Termination of Employment. Employee's employment hereunder may
be terminated prior to the end of the Term
under the following circumstances:
(a) Death. Employee's employment hereunder shall terminate
upon Employee's death.
(b) Employee's Becoming Totally Disabled. The Company may
terminate Employee's employment hereunder
at any time after Employee becomes
"Totally Disabled". For purposes of this
Agreement, Employee shall be "Totally
Disabled" in the event Employee is unable
to perform the duties and
responsibilities contemplated under this
Agreement for a period of one hundred
twenty (120) consecutive days or one
hundred eighty (180) days in any
consecutive 365-day period due to physical
or mental incapacity or impairment.
During any period that Employee fails to
perform Employee's duties hereunder as
a result of incapacity due to physical or
mental illness (the "Disability
Period"), Employee shall continue to
receive the compensation and benefits
provided by Section 3 of this Agreement
until Employee's employment hereunder is
terminated; provided, however, that the
amount of Base Salary, bonus and
benefits received by Employee during the
Disability Period shall be reduced by
the aggregate amounts, if any, payable to
Employee under any disability benefit
plan or program provided to Employee by the
Company.
(c) Termination by the Company for Cause. The Company may
terminate Employee's employment hereunder
for Cause at any time after providing
written notice to Employee. For purposes of
this Agreement, the term "Cause"
shall mean any of the following: (i) the
willful and repeated failure or refusal
of Employee to perform Employee's duties
hereunder in material respects (other
than as a result of total or partial
incapacity due to physical or mental
illness), provided that the Company
notifies Employee in writing of such failure
or refusal and Employee fails to
substantially cure same within ninety (90) days
of such notice; (ii) perpetration of an
intentional and knowing fraud against or
affecting the Company or any affiliate,
customer, client, agent, or employee
thereof; (iii) conviction (including,
without limitation, conviction on a nolo
contendere plea) of a felony or any crime
involving, in the good faith judgment
of the Company, fraud, dishonesty or moral
turpitude; or (iv) the inability of
the Company or any Controlled Entity to
exploit substantially all of the Foreman
Indicia and the Marks assigned to the
Company pursuant to that certain
Assignment Agreement, dated as of the date
hereof, by and between George Foreman
and George Foreman Productions, Inc.
(together, "Foreman"), on the one hand, and
the Company on the other hand. For purposes
of this Agreement, the term
"Controlled Entity" shall mean an entity
(x) of which the Company or MM
Companies, Inc., a member of the Company,
is the managing member, sole general
partner or sole director, or (y) which
provides Foreman with the same management
rights provided to Foreman pursuant to
Section 3 of that certain amended and
restated limited liability company
agreement of the Company, dated as of the
date hereof.
(d) Termination by the Company without Cause. The Company may
terminate Employee's employment hereunder
at any time for any reason or no
reason by giving Employee thirty (30) days
prior written notice of the
termination; provided, however, that the
Company may provide such notice of
termination and effect such termination
only with the affirmative vote or
written consent of a majority of the
members of the board of managers of the
Company (or the board of directors or
equivalent governing body, in the event of
a successor to, or permitted assignee of,
the Company). Following any such
notice, the Company may reduce or
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remove any and all of Employee's duties,
positions and titles with the Company
and any of its subsidiaries.
(e) Termination by Employee for Good Reason. Employee may
terminate his employment hereunder for Good
Reason at any time after providing
written notice to the Company. For purposes
of this Agreement, the term "Good
Reason" shall mean any of the following:
(i) a material breach by the Company of
this Agreement, provided that, if
susceptible of cure, Employee notifies the
Company in writing of such breach and the
Company fails to cure same within
thirty (30) days of such notice; (ii) any
material change in Employee's duties
and responsibilities which would constitute
a demotion, provided that Employee
notifies the Company of such reduction and
the Company fails to cure same within
thirty (30) days of such notice and (iii) a
Change of Control. For purposes of
this Agreement, a "Change in Control" shall
be deemed to occur if any "person"
(as such term is used in Sections 13(d) and
14(d)(2) of the Securities Exchange
Act of 1934, as amended (the "Exchange
Act")), other than persons who own ten
percent (10%) or more of voting securities
of the Company on the Effective Date,
any member of the Foreman family or any
entity controlled by the Foreman family
or any member of the Foreman family,
becomes the beneficial owner (within the
meaning of Rule 13d-3 under the Exchange
Act), directly or indirectly, of more
than fifty percent (50%) of the combined
voting power of the then outstanding
securities of the Company.
(f) Termination by Employee without Good Reason. Employee may
terminate his employment hereunder at any
time for any reason or no reason by
giving the Company thirty (30) days prior
written notice of the termination.
Following any such notice, the Company may
reduce or remove any and all of
Employee's duties, positions and titles
with the Company and any of its
subsidiaries.
5.
Compensation Following Termination Prior to the End of the
Term and Upon Nonrenewal of this Agreement.
In the event that Employee's
employment hereunder is terminated prior to
the end of the Term or this
Agreement is not renewed, Employee shall be
entitled only to the following
compensation and benefits upon such
termination or nonrenewal:
(a) Termination by Reason of Death or Employee's Becoming
Totally Disabled; Termination by Employee
for Good Reason. In the event that
Employee's employment is terminated prior
to the expiration of the Term by
reason of Employee's death pursuant to
Section 4(a) hereof, by the Company by
reason of Employee's becoming Totally
Disabled pursuant to Section 4(b) hereof,
or by Employee for Good Reason pursuant to
Section 4(e) hereof, the Company
shall pay the following amounts to Employee
as soon as practicable following the
date of termination:
(i) any accrued but unpaid Base Salary (as determined
pursuant to Section 3 hereof) for services rendered to the
date of termination; provided, however, that in the event
Employee's employment is terminated pursuant to Section 4(b)
hereof, the amount of Base Salary received by Employee during
the Disability Period shall be reduced by the aggregate
amounts, if any, payable to Employee under any disability
benefit plan or program provided to Employee by the Company;
(ii) any accrued but unpaid bonus;
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(iii) any accrued but unpaid expenses required to be
reimbursed pursuant to Section 3(d) hereof;
(iv) any vacation accrued to the date of termination; and
(v) an amount equal to the lesser of (x) the amount of the
Base Salary that would have been payable by the Company to
Employee from the date of termination through the end of the
Term and (y) $250,000; provided, however, that if Employee
terminates his employment for Good Reason pursuant to Section
4(e) hereof prior to the third anniversary of the Effective
Date, the amount of the payment pursuant to this Section
5(a)(v) shall be the amount of the Base Salary that would have
been payable by the Company to Employee from the date of
termination through the end of the Term; provided further
that, notwithstanding the foregoing, if the Company determines
that Employee is a "specified employee" within the meaning of
Section 409A(a)(2)(B)(i) of the Internal Revenue Code of 1986,
as amended, and accompanying administrative guidance, (A) the
payment pursuant to this Section 5(a)(v) shall not be made for
a six-month period following the date of termination and (B)
such sum shall be paid in a lump sum payment as soon as
practicable after the date that is six months after the
termination of employment.
If, at the time of such termination or any time thereafter,
Employee is in material breach of any
covenant contained in Section 6 hereof,
Employee shall not be entitled to any
payment under clause (v) of this Section
5(a).
(b) Termination by the Company without Cause. In the event
that Employee's employment is terminated
prior to the expiration of the Term by
the Company without Cause pursuant to
Section 4(d) hereof, the Company shall pay
the following amounts to Employee as soon
as practicable following the date of
termination:
(i) any accrued but unpaid Base Salary (as determined
pursuant to Section 3 hereof) for services rendered to the
date of termination;
(ii) any accrued but unpaid bonus;
(iii) any accrued but unpaid expenses required to be
reimbursed pursuant to Section 3(d) hereof;
(iv) any vacation accrued to the date of termination; and
(v) an amount equal to the greater of (x) the amount of
the Base Salary that
would have been payable by the Company to
Employee from the date of termination through the end of the
Term and (y) $500,000; provided that, notwithstanding the
foregoing, if the Company determines that Employee is a
"specified employee" within the meaning of Section
409A(a)(2)(B)(i) of the Internal Revenue Code of 1986, as
amended, and accompanying administrative guidance, (A) the
payment
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pursuant to this Section 5(b)(v) shall not be made for a
six-month period following the date of termination and (B)
such sum shall be paid in a lump sum payment as soon as
practicable after the date that is six months after the
termination of employment; provided further that Employee
shall have the option, in his sole discretion, to receive
50,000 shares of the common stock, par value $0.01 per share,
of MM Companies, Inc. in lieu of the payment pursuant to this
Section 5(b)(v); provided further that, if, at the time of
such termination or any time thereafter, Employee is found to
be in material breach of any covenant contained in Section 6
hereof, the amount of the damages and costs resulting from
such breach shall be deducted from the amount of the payment
Employee would otherwise be entitled to receive under this
Section 5(b)(v).
(c) Termination by Employee without Good Reason; Nonrenewal of
this Agreement. In the event that
Employee's employment is terminated prior to
the expiration of the Term by Employee
without Good Reason pursuant to Section
4(f) hereof or in the event that Employee
or the Company gives written notice of
his or its election not to renew this
Agreement pursuant to Section 1 hereof,
the Company shall pay the following amounts
to Employee as soon as practicable
following the date of termination:
(i) any accrued but unpaid Base Salary (as determined
pursuant to Section 3 hereof) for services rendered to the
date of termination;
(ii) any accrued but unpaid bonus;
(iii) any accrued but unpaid expenses required to be
reimbursed pursuant to Section 3(d) hereof; and
(iv)
