EXHIBIT 99.11
October 3,
2008
Mr. Michael W.
Klinger
22420 Crooked
Creek Road
Cicero,
IN 46034
Dear
Mike,
This letter
confirms certain terms and conditions of your continued employment
in consideration of your new title and duties effective September
19, 2008, in the position of Executive Vice President and Chief
Financial Officer and Treasurer of EDCI Holdings, Inc. (The
“Company”) and supersedes any prior offer letter or
other agreement regarding your employment by the Company or any of
its subsidiaries. This position is located in or near Fishers,
Indiana and reports directly to the Chief Executive Officer and/or
Chairman of the Board of Directors of the Company. You
are responsible for financial planning and analysis, accounting,
SEC reporting and matters related to treasury, tax, information
technology, risk management, procurement, payroll and investor
relations, as well as such duties and services as normally are
associated with such position, which may be assigned to you from
time to time.
Your base
compensation will be $20,800 per month (the “Base
Salary”), which shall be paid in bi-weekly installments in
accordance with the Company’s normal payroll
practices. Your Base Salary and performance will be
reviewed after your initial six months in this position and
thereafter on an annual basis each year. Your Base
Salary may be increased (but not decreased) in the manner
determined by the Company in consultation with the Company’s
Board of Directors (the “Board”) or the Compensation
Committee of the Board.
You will be
eligible to participate in the Company’s bonus plans or
programs as shall be established by the Board upon recommendations
from management of the Company from time to time for senior
executives of the Company. In addition, you will be
eligible to receive discretionary bonus awards as the Board may
determine in its sole discretion from time to time.
During the term
of your employment, you will be entitled to four (4) weeks of
vacation in each calendar year at such times as shall be mutually
convenient to you and the Company. Your vacation will be
prorated for each partial calendar year during the term of your
employment.
During the term
of your employment, you will receive a monthly car allowance of
$400, which will cover local driving and parking expenses incurred
in connection with the performance of your duties
hereunder.
During the term
of your employment, you may participate in all retirement plans,
life, medical/dental insurance plans and disability insurance plans
of the Company, as in effect from time to time, to the extent that
you qualify under the eligibility requirements of each plan or
program. Details of our current benefits plan have
previously been provided to you.
You will
continue to be entitled to a “stay bonus”, previously
provided in your letter agreement dated November 26, 2007, of
$60,000 payable in a lump sum if you remain employed by the Company
through October 31, 2008 or, in the event a Change in Control (as
defined below) occurs prior to October 31, 2008, you remain
employed by the Company or any successor to the Company following a
Change in Control, through the 90 day anniversary of any such
Change in Control. If earned, the Company will pay you
the stay bonus within two days after October 31, 2008 or two days
after the 90 day anniversary of a Change in Control, as
applicable.
In the event
your employment is terminated by the Company without Cause (as
defined below) or by you with Good Reason (as defined below), the
Company will pay you, subject to the limitations set forth below, a
lump sum severance payment equal to the amount of your Base Salary
in effect on such termination date multiplied by
12. You also shall be entitled to receive the sum
of (1) your accrued but unpaid Base Salary through the date of
such termination, plus (2) your accrued but unpaid
vacation pay through such date of termination, plus (3) if you
are then participating in the Company’s annual bonus plan, a
pro-rated annual bonus for the bonus year in which you are
terminated, which shall be calculated and paid in accordance with
the Company’s normal practices at the end of such bonus
year, provided that you have been employed by
the Company for at least six months of such bonus year, plus (4)
any other compensation payments or benefits which have accrued and
are payable in connection with such termination. In
addition, the Company shall continue to provide medical and dental
benefits to you and your dependents for a period of 12 months
following such date of termination at the same levels of
coverage and in the same manner as such benefits are available to
you and your dependents immediately prior to such Change in
Control. Your right to continue medical and dental
coverage under the Consolidated Omnibus Budget Reconciliation
Act of 1995 (“COBRA”) shall begin after the expiration
of the one-year period described in the foregoing
sentence.
If a Change in
Control (as defined below) occurs and if your employment is
terminated within six months after such Change in Control
for
