This EMPLOYMENT
AGREEMENT (this “Agreement”), dated April 29,
2009, is entered into by and between REVLON CONSUMER PRODUCTS
CORPORATION, a Delaware corporation (“RCPC” and,
together with its parent Revlon, Inc. (“Revlon”) and
its subsidiaries, the “Company”), and Steven Berns (the
“Executive”).
Whereas, RCPC
wishes to employ the Executive and the Executive wishes to accept
employment with the Company on the terms and conditions set forth
in this Agreement.
Now, therefore,
RCPC and the Executive hereby agree as follows:
1.
Employment, Duties and Acceptance .
1.1
Employment, Duties . RCPC hereby employs the Executive for
the Term (as defined in Section 2.1) to render exclusive and
full-time services to the Company in the capacity of Chief
Financial Officer and Treasurer of Revlon and RCPC, with
responsibility for all financial operations of the Company,
including without limitation, treasury, controllers group,
accounting, internal audit, internal control over financial
reporting, investor relations and tax, and such other duties and
responsibilities consistent with such position (including service
as a director of the Company or director or officer of any
subsidiary of the Company if so elected) as may be assigned to the
Executive from time to time by the Company’s President and
Chief Executive Officer (the “CEO”). The
Executive’s title shall be Executive Vice President, Chief
Financial Officer and Treasurer of Revlon and RCPC, or such other
title of at least equivalent level consistent with the
Executive’s duties from time to time as may be assigned to
the Executive. The Executive shall be a member of the Operating
Committee or such other committee of the Company’s most
senior executives as may succeed the Operating Committee from time
to time and report to the CEO or his designee.
1.2
Acceptance . The Executive hereby accepts such employment
and agrees to render the services described above. During the Term,
the Executive agrees to serve the Company faithfully and to the
best of the Executive’s ability, to devote the
Executive’s entire business time, energy and skill to such
employment, and to use the Executive’s best efforts, skill
and ability to promote the Company’s interests.
1.3
Location . The duties to be performed by the Executive
hereunder shall be performed primarily at the office of RCPC in the
New York City metropolitan area, subject to reasonable travel
requirements consistent with the nature of the Executive’s
duties from time to time on behalf of the Company.
1.4
Performance Warranty . As an inducement for the Company to
enter into this Agreement, the Executive hereby represents that the
Executive is not a party to any contract, agreement or
understanding which prevents, prohibits or limits the Executive in
any way from entering into and fully performing the
Executive’s obligations under this Agreement and any duties
and responsibilities that may be assigned to the Executive
hereunder.
2. Term
of Employment; Certain Post-Term Benefits .
2.1
The Term . The Term of the Executive’s employment
under this Agreement (the “Term”) shall commence no
later than May 26, 2009 (the actual commencement date of
full-time employment hereunder is hereinafter referred to as the
“Effective Date”) and shall end twenty-four
(24) months after RCPC provides to the Executive a notice of
non-renewal, unless in either case sooner terminated pursuant to
Section 4. During any period that the Executive’s
employment shall continue following the end of the Term, the
Executive shall be deemed an employee at will, provided, however,
that the Executive shall be eligible for severance on the terms and
subject to the conditions of the Revlon Executive Severance Pay
Plan as in effect from time to time, or such plan or plans, if any,
as may succeed it (the “Executive Severance Plan”),
provided that the severance and benefit continuation period for the
Executive under the Executive Severance Plan shall be not less than
24 months, subject to the terms and conditions of such plan.
The effectiveness of this Agreement, including the restricted stock
award referred to in Section 3.3, is subject to the Executive
commencing full-time employment with the Company hereunder on or
before May 26, 2009.
2.2
Special Curtailment . The Term shall end earlier than the
date provided in Section 2.1, if sooner terminated pursuant to
Section 4.
3.
Compensation; Benefits .
3.1
Salary . The Company agrees to pay the Executive during the
Term a base salary, payable bi-weekly, at the annual rate of not
less than $425,000 (the “Base Salary”). All payments of
Base Salary or other compensation hereunder shall be less such
deductions or withholdings as are required by applicable law and
regulations. The Executive will be considered for merit increases
in connection with the Executive’s performance evaluations,
which are performed in accordance with the Company’s salary
administration policies and procedures (which generally occur
annually). In the event that RCPC, in its sole discretion, from
time to time determines to increase the Base Salary, such increased
amount shall, from and after the effective date of the increase,
constitute “Base Salary” for purposes of this Agreement
and shall not thereafter be decreased.
3.2
Bonus . The Executive shall be eligible to participate in
the Revlon Executive Bonus Plan as in effect from time to time, or
such plan or plans, if any, as may succeed it (the “Bonus
Plan”), with maximum bonus eligibility of 100% of Base Salary
for significantly over-achieving performance objectives set by the
Compensation Committee or its designee and target bonus eligibility
of 75% of Base Salary for achieving performance objectives set by
the Compensation Committee or its designee, subject to the terms
and conditions of such Bonus Plan (including that, for 2009, the
Bonus Plan has been accrued at 50% of target if certain corporate
performance objectives are achieved); provided, that,
notwithstanding the terms of the Bonus Plan, the Company agrees
that the Executive’s 2009 bonus shall not be pro-rated due to
the Executive’s effective date of employment commencing later
than January 1, 2009. In the event that the Executive’s
employment shall terminate pursuant to Section 4.4 during any
calendar year, the Executive’s bonus with respect to the year
during which such termination occurs shall be prorated for the
actual number of days of active employment during such year and
such bonus
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as prorated
shall be payable (i) if and to the extent bonuses are payable
to executives under the Bonus Plan for that year based upon
achievement of the corporate objectives set for that year and not
including any discretionary bonus amounts which may otherwise be
payable to other executives despite non-achievement of bonus
objectives for such year and (ii) on the date bonuses would
otherwise be payable to executives under the Bonus Plan.
Notwithstanding anything herein or contained in the Bonus Plan to
the contrary, in the event that the Executive’s employment
shall terminate pursuant to Section 4.4 during any calendar
year, the Executive shall be entitled to receive the
Executive’s bonus (if not already paid) with respect to the
year immediately preceding the year of termination (if bonuses with
respect to such year are payable to other executives based upon
achievement of bonus objectives and not based upon discretionary
amounts which may be paid to other executives despite
non-achievement of bonus objectives) as and when such bonuses would
otherwise be payable to executives under the Bonus Plan, despite
the fact that Executive may not be actively employed on such date
of payment.
3.3
Stock-Based Compensation . At the Compensation
Committee’s next regularly scheduled meeting at which stock
grants are on the agenda for consideration, the Executive shall be
recommended to the Compensation Committee to receive 25,000 shares
of restricted Revlon Class A common stock with time based
vesting (with one-third of such shares vesting on July 2,
2010; one-third of such shares vesting on July 2, 2011; and
one-third of such shares vesting on July 2, 2012). After such
initial grant, the Executive shall be eligible for recommendation
to the Compensation Committee or other committee of the Board
administering the Third Amended and Restated Revlon, Inc. Stock
Plan (the “Stock Plan”) or any plan that may replace
it, as from time to time in effect, to receive an award of stock
options, restricted shares or other awards during the Term, at
levels, on terms, and at such times as are generally applicable to
other senior executives of the Executive’s level, provided
that the Executive must be actively employed on the date of such
grant. In the event the Stock Plan is no longer in effect, the
Executive shall be eligible to participate in such other long-term
incentive compensation plan as the Company may adopt as a successor
plan, on terms and at such times as are generally applicable to
other senior executives of the Executive’s level, subject to
the terms of such plan(s).
3.4
Business Expenses . RCPC shall pay or reimburse the
Executive for all reasonable expenses actually incurred or paid by
the Executive during the Term in the performance of the
Executive’s services under this Agreement, subject to and in
accordance with the Revlon Travel and Entertainment Policy as in
effect from time to time, or such policy or policies, if any, as
may succeed it.
3.5
Vacation . During each year of the Term, the Executive shall
be entitled to a vacation period or periods in accordance with the
vacation policy of the Company as in effect from time to time, but
not less than four weeks; provided that the Executive shall be
entitled to fifteen business days in total of vacation days for
2009.
3.6
Fringe Benefits . During the Term, the Executive shall be
entitled to participate in those qualified and non-qualified
defined benefit, defined contribution, group life insurance,
medical, dental, disability and other benefit plans and programs of
the Company as from time to time in effect (or their successors)
generally made available to other executives of the
Executive’s level and in such other plans and programs and in
such perquisites, as from time to time in effect, as may be
generally made available to senior executives of the Company of
the
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Executive’s level generally. Further,
during the Term, the Executive will be eligible (a) to
participate in Revlon’s Executive Financial Counseling and
Tax Preparation Program, as from time to time in effect, or such
program or programs, if any, as may succeed it, and (b) to
receive a car allowance at the rate of $15,000 per annum, under the
car allowance program as in effect from time to time, or such
program or programs, if any, as may succeed it.
3.7
Internal Revenue Code Section 409A . Section 409A
of the Code (as defined below) and/or its related rules and
regulations (“Section 409A”), imposes additional
taxes and interest on compensation or benefits deferred under
certain “nonqualified deferred compensation plans” (as
defined under the Code). These plans may include, among others,
nonqualified retirement plans, bonus plans, stock option plans,
employment agreements and severance agreements. The Company
reserves the right to provide compensation or benefits under any
such plan in amounts, at times and in a manner that minimizes
taxes, interest or penalties as a result of Section 409A,
including any required withholdings, and the Executive agrees to
cooperate with the Company in such actions. Specifically, and
without limitation of the previous sentence, if the Executive is a
“specified employee,” as such term is defined under
Section 409A (generally one of the Company’s top 50
highest paid officers), to the extent required under
Section 409A, the Company will not make any payments to the
Executive under this Agreement upon a “separation from
service,” as such term is defined under Section 409A,
until six months after the Executive’s date of separation
from service or, if earlier, the date of the Executive’s
death. Upon expiration of the six-month period, or, if earlier, the
date of the Executive’s death, the Company shall make a
payment to the Executive (or his beneficiary or estate, if
applicable) equal to the sum of all payments that would have been
paid to the Executive from the date of separation from service had
the Executive not been a “specified employee” through
the end of the six month period, and thereafter the Company will
make all the payments at the times specified in this Agreement or
applicable policy, as the case may be. In addition, the Company and
the Executive agree that, for purposes of this Agreement,
termination of employment (or any variation thereof) will satisfy
all of the requirements of “separation from service” as
defined under Section 409A. For purposes of this Agreement,
the right to a series of installment payments, such as salary
continuation or severance payments, shall be treated as the right
to a series of separate payments and shall not be treated as a
right to a single payment. For purposes of this Agreement, the term
“Code” shall mean the Internal Revenue Code of 1986, as
amended, including all final regulations promulgated thereunder,
and any reference to a particular section of the Code shall include
any provision that modifies, replaces or supersedes such
section.
4.1
Death . If the Executive shall die during the Term, the Term
shall terminate and no further amounts or benefits shall be payable
hereunder, other than (i) for accrued, but unpaid, Base Salary
as of such date and (ii) pursuant to life insurance provided
under Section 3.6.
4.2
Disability . If during the Term the Executive shall become
physically or mentally disabled, whether totally or partially, such
that the Executive is unable to perform the Executive’s
services hereunder for (i) a period of six consecutive months
or (ii) shorter periods aggregating six months during any
twelve month period, RCPC may at any time after the last day of the
six consecutive months of disability or the day on which the
shorter periods of
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disability
shall have equaled an aggregate of six months, by written notice to
the Executive (but before the Executive has returned to active
service following such disability), terminate the Term and no
further amounts or benefits shall be payable hereunder, other than
for accrued, but unpaid, Base Salary as of such date.
4.3
Cause . RCPC may at any time by written notice to the
Executive terminate the Term for “Cause” and, upon such
termination, the Executive shall be entitled to receive no further
amounts or benefits hereunder, except for accrued, but unpaid,
salary as of such date and as required by law. As used herein the
term “Cause” shall mean gross neglect by the Executive
of the Executive’s duties hereunder, conviction of the
Executive of any felony, conviction of the Executive of any lesser
crime or offense involving the property of the Company or any of
its affiliates, misconduct by the Executive in connection with the
performance of the Executive’s duties hereunder or other
breach by the Executive of this Agreement (specifically including,
without limitation, Section 1.4), any breach of the Revlon
Code of Business Conduct, including, without limitation, the Code
of Ethics for Senior Financial Officers, or the Employee’s
Agreement as to Confidentiality and Non-Competition, or any other
conduct on the part of the Executive which would make the
Executive’s continued employment by the Company prejudicial
to the best interests of the Company. If and to the extent any
occurrence of Cause is capable of cure in the good faith
determination of the Company, the Company shall provide notice of
same to the Executive, who shall then have ten days to cure such
event of Cause to the satisfaction of the Company, it being
acknowledged and agreed that the Company’s good faith
determination as to whether a Cause event is subject to cure shall
be final and binding upon the parties.
4.4
Company Breach; Other Termination . The Executive shall be
entitled to terminate the Term and the Executive’s employment
upon 60 days’ prior written notice (if during such
period RCPC fails to cure any such breach) in the event that RCPC
materially breaches any of its obligations hereunder. In addition,
RCPC shall be entitled to terminate the Term and the
Executive’s employment at any time and without prior notice
(otherwise than pursuant to the provisions of Section 4.2 or
4.3). In consideration of the Executive’s covenant in
Section 5.2, upon termination under this Section 4.4 by
the Executive, or in the event RCPC so terminates the Term
otherwise than pursuant to the provisions of Section 4.2 or
4.3, RCPC agrees, and the Company’s sole obligation arising
from such termination shall be, for RCPC either
(i) to
make payments in lieu of Base Salary in the amounts prescribed by
Section 3.1, to pay the Executive the portion, if any, of any
annual bonus contemplated by Section 3.2 and to continue the
Executive’s participation in the medical, dental and group
life insurance plans and other perquisites of the Company in which
the Executive was entitled to participate pursuant to Section 3.6
(in each case less amounts required by law to be withheld) through
the date on which the Term would have ended pursuant to
Section 2.1, if RCPC had given notice of non-renewal on the
date of termination (such period shall be referred to as the
“Severance Period”), provided that (1) such
benefit continuation is subject to the terms of such plans,
(2) life insurance continuation is subject to a limit of two
years, (3) the Executive shall cease to be covered by medical
and/or dental plans of the Company at such time as the Executive
becomes covered by like plans of another company, (4) any
bonus payments required pursuant to this Section 4.4(i) shall
be payable as and when bonuses would otherwise be payable to
executives under the Bonus Plan as then in effect, (5) the
Executive shall, as a condition, execute
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such release,
confidentiality, non-competition (consistent in all respects with
the Non- Competition Agreement (as defined in Section 5.2,
below)) and other covenants as would be required in order for the
Executive to receive payments and benefits under the Executive
Severance Plan that is applicable to the Executive referred to in
clause (ii) below, and (6) any cash compensation paid or
payable or any non-cash compensation paid or payable in lieu of
cash compensation earned by the Executive from other employment or
consultancy during such period shall reduce the payments provided
for herein payable with respect to such other employment or
consultancy, or
(ii) to
make the payments and provide the benefits prescribed by, and in
accordance with the terms and conditions of, the Executive
Severance Plan.
The Company
shall provide the greater of the payments and other benefits
described under clauses (i) and (ii) of this
Section 4.4; provided , however , if the
provision of any benefits described above would trigger a tax under
Section 409A, the Company shall instead promptly pay to the
Executive in a cash lump sum payment an amount equal to the value
(based on the then-current cost to the Company) of such benefits.
Any compensation earned by the Executive from other employment or a
consultancy shall reduce the payments required pursuant to clause
(i) above or shall be governed by the terms of the Executive
Severance Plan in the case of clause (ii) above.
4.5
Litigation Expenses . If RCPC and the Executive become
involved in any action, suit or proceeding relating to the alleged
breach of this Agreement by RCPC or the Executive, or any dispute
as to whether a termination of the Executive’s employment is
with or without Cause, then if and to
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