EXHIBIT 10.1
SEPARATION AGREEMENT AND MUTUAL RELEASE
This Separation Agreement and Mutual Release (this "AGREEMENT"),
dated
as of October 5, 2007, is entered into by and between People's
Liberation, Inc.,
a Delaware
corporation
(the "COMPANY" or "PARTY"), and Daniel Guez, an
individual ("EXECUTIVE" or "PARTY") (collectively "the
Parties").
RECITALS
A. The
Company and Executive
entered into that
certain Amended
and Restated
Employment
Agreement,
dated June 19, 2007 (the "EMPLOYMENT
AGREEMENT"), that
certain Confidentiality and Non-Disclosure Agreement, dated
January 12,
2007 (the "EMPLOYEE NDA"), and that certain Indemnification
Agreement, dated January 5, 2006 (the "INDEMNIFICATION AGREEMENT"),
pursuant to
which the Company retained Executive, as more fully described
therein.
B.
Executive resigned his employment with the Company and each of
its subsidiaries and affiliates effective October 2, 2007. The
Company accepted
Executive's
resignation, and
the Parties now wish to resolve any and all
remaining issues between them.
NOW, THEREFORE, for
good and valuable
consideration, the
receipt and
sufficiency of which
are hereby
acknowledged,
the Parties hereby agree as
follows:
1.
RESIGNATION; TERMINATION
OF
EMPLOYMENT
AGREEMENT.
Notwithstanding
anything to
the contrary which may be contained in the
Employment Agreement,
the Parties hereby
acknowledge and agree that, effective
as of the date of this Agreement:
1.1 Executive
resigned his
employment
with the Company
and each of its subsidiaries in all capacities, including, without limitation,
his position as
Creative Director of
the Company,
any position he holds
with
Versatile
Entertainment, Inc., a
California
corporation, and his
position as
Manager of each of Bella Rose, LLC, a California limited liability company,
William Rast Sourcing,
LLC, a Delaware limited liability company, and William
Rast Licensing, LLC, a
Delaware limited
liability company effective October 2,
2007.
1.2
The Company has accepted the resignation. The
Employment Agreement is terminated and of no further force or
effect. Except as
expressly provided
herein, all responsibilities, duties and obligations of
Executive to the
Company and of the Company to Executive under the Employment
Agreement shall be terminated and of no further force or effect.
Notwithstanding
the foregoing, Executive will still continue to serve in his
current capacity on
the Board of Directors of the Company.
2.
TERMINATION PAYMENTS.
As full and complete
consideration for
the covenants hereunder, the Company shall pay Executive the
following amounts:
2.1 For the
period from the date hereof through and
including December 31, 2007, an amount in cash of $50,000, which
amount is equal
to the Base Salary (as defined in the Employment Agreement) that
would have been
paid to Executive during such period in accordance with the
Employment Agreement
if Executive remained employed with the Company during such period.
Such amount
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shall be paid to Executive in semi-monthly payments of $8,333 on the
Company's
regularly scheduled
pay days for the
months of October,
November and December
2007.
2.2 An
automobile
allowance of $3,600,
of which $1,200
shall be payable on each of October 15, 2007, November 15, 2007 and
December 15,
2007.
2.3 For the
period from the date hereof through and
including the first
anniversary of the
date hereof, Company
shall continue to
provide Executive and
Executive's
eligible family members with group health
insurance coverage at least equal to that which would have been
provided to them
if Executive's employment had not been terminated (or at Company's
election, pay
the applicable COBRA
premium for such
coverage); provided,
however, that if
Executive becomes
re-employed with
another employer and is eligible to receive
group health insurance
coverage under another employer's plans, Company's
obligations under this
Section shall
terminate and any such coverage shall be
reported by Executive to Company.
2.4 Executive
acknowledges and
agrees that Executive has
four weeks of accrued
but unused vacation days pursuant to the Company's
vacation policy
as of the date
hereof equal to the total gross amount of
$16,666. Such
vacation pay shall be paid to Executive on execution of this
Agreement.
Notwithstanding
anything to the contrary which may be contained in
the Employment Agreement, Executive acknowledges that the
payments set forth in
this SECTION 2 fully satisfy all obligations of the Company to
Executive under
the Employment
Agreement (whether attributable to salary, bonus payments,
vacation pay, automobile allowance, expenses or other amounts).
Notwithstanding
the foregoing,
the Company
agrees that it shall
continue to be
obligated to
repay all balances on Company credit cards incurred by Executive to the
extent
such amounts represent
expenses incurred on behalf of the Company. The Company
will reimburse all
such business
expenses no later than
November 15, 2007 and
such expenses shall include Executive's cell phone bill through
October 15, 2007
2.5
Company
shall allow Executive to transfer his current
cell phone number to a
personal cell phone
account and will
assist Executive
with this process.
3. NO
DISPARAGEMENT.
Neither Party shall make any statement
or
allegation to any third party, nor make any public announcement, press release
or broad-tape release, public speech or permit press interviews,
which expressly
or impliedly indicates
that the other Party
breached or
defaulted under any
obligation or
commitment to it, or
which might reasonably
have the effect of
disparaging such other
Party or injuring
or harming the
personal or
business
reputation of the other party.
4.
EMPLOYEE NDA AND INDEMNIFICATION AGREEMENT. The parties each
acknowledge and agree that the Employee NDA and Indemnification
Agreement shall
survive execution of
this Agreement. By
their signatures
below, the Parties
acknowledge and agree that nothing contained in the Employee NDA is
intended to
prevent Executive from entering into or becoming employed by a
business which is
in competition
with the Company and
that Executive
is free to engage in
such
competition. The
parties further
acknowledge
that nothing contained in the
Employee NDA shall limit Executive from soliciting or otherwise conducting
business with any contract vendor or supplier of the Company
including without
limitation, sewers,
embroiders,
silkscreeners,
laundries, fabric
vendors and
international distributors.
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<PAGE>
5.
MUTUAL RELEASE.
5.1
EXECUTIVE'S
RELEASE. Subject
to SECTION 5.3,
Executive, for
himself and on behalf of his successors, assigns, agents,
attorneys,
representatives,
heirs, executors and administrators (collectively,
the "EXECUTIVE PARTIES" and individually, an "EXECUTIVE PARTY"),
hereby releases
and forever
discharges
and agrees to hold harmless the Company and its
successors, assigns, officers, directors, shareholders, employees, affiliates,
subsidiaries, parent corporations, agents, attorneys and
representatives,
past
and present
(collectively, the
"COMPANY PARTIES" and individually, a "COMPANY
PARTY") from any and all demands, claims, duties, actions,
obligations or causes
of action,
assessments,
losses, damages, liabilities, costs and expenses
(including attorneys' fees) of any kind, nature or description,
whether known or
unknown, suspected
or unsuspected, fixed or contingent (collectively, the
"RELEASED CLAIMS"),
that Executive or any Executive Party currently has or
possesses, or had
prior to the date of this Agreement or at any time may have
the Company and/or
against one or more Company Parties, arising out of, based
upon or in any way related to (i) any employment agreement or the Employment
Agreement or any other contracts, express or implied, any covenant
of good faith
and fair dealing,
express or implied, any theory of wrongful discharge,
negligence, negligent or intentional infliction of emotional
distress, negligent
or intentional
interference with
contract or prospective economic advantage,
negligent or intentional misrepresentation, conspiracy, defamation (including
libel and slander),
invasion of privacy,
fraud, quantum meruit, failure to pay
compensation of any kind, failure to pay equal compensation for equal work or
any legal restriction
on the Company's right to terminate employees; (ii)
Executive's employment with the Company or the cessation thereof,
any claims for
wages, compensation of
any kind, automobile allowance, vacation pay, severance
pay, bonuses or damages of any kind whatsoever, including without
limitation all
claims for or under,
among other things,
Title VII of the Civil
Rights Act of
1964, as amended (42 U.S.C. sections 2000e, ET SEQ.),
the Fair Labor
Standards
Act, including
the Equal Pay Act (29
U.S.C. section
206(d) and
interpretive
regulations), the
Employment Retirement
Income Security Act of 1974 (29 U.S.C.
sections 100, ET
seq.), the Family and
Medical Leave Act (29
U.S.C. sections
2601, ET SEQ. and 29 C.F.R. Part 825), the Americans with
Disabilities Act
(42
U.S.C. sections
12101, ET SEQ.), the Age Discrimination in Employment Act,
including the Older Worker Benefits Protection Act (29 U.S.C.
sections 623, et
seq.), the Worker Adjustment and Retraining Notification Act (29
U.S.C. sections
2101, ET SEQ.), the
California
Fair Employment and Housing Act (California
Government Code
sections 12940,
ET SEQ.), the California Family Rights Act
(California
Government Code
section 12945.2), the California Labor Code
(expressly including
Sections 203, 206,
218.5 and the Equal
Pay Act, Section
1197.5), the United States and California Constitutions, and any other federal
or state law, whether
statutory or common law; (iii) all matters arising out of
any common
law or federal, state, local or other governmental statute,
regulation, ordinance
or wage order,
including any federal, state or local law
(statutory or
decisional) or
regulation
relating to
employment,
employment
discrimination or
harassment; or (iv)
arising out of any principle of contract
law or common law.
5.2 THE
COMPANY'S RELEASE. Subject to SECTION 5.3, the
Company, for itself
and on behalf of the Company Parties, hereby releases and
forever discharges
and agrees to hold harmless Executive and each of the
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Executive Parties
from any and all
Released Claims that the Company or any
Company Party
currently has or possesses, or had prior to the date of this
Agreement or at any time may have against Executive and/or one or
more Executive
Parties, arising
out of, based upon or in any way
related
