Contact Information: Company Contact: Anthony Christon Chief Financial Officer Jaclyn, Inc. (201) 909-6000
Jaclyn, Inc. Enters Into Employment Agreement With Chief Executive Officer
| Source: Jaclyn, Inc
MAYWOOD, NJ--(Marketwire - October 6, 2009) - Jaclyn, Inc. (OTCQX : JCLY ) today announced that
it has entered into an employment agreement with Robert Chestnov under
which he will continue to serve as the Company's President and Chief
Executive Officer through at least October 2014, subject to extension or
earlier termination. Mr. Chestnov has been the Company's President and
Chief Executive Officer since November 1988.
Under the terms of the employment agreement, Mr. Chestnov is entitled to
receive an annual base salary of $435,000 and a minimum annual bonus in an
amount equal to 25% of his annual base salary, each of which may be
increased in the discretion of the Board of Directors' executive committee.
In addition, under the terms of a stock award contract between the Company
and Mr. Chestnov, he received a stock award on the date of the signing of
the employment agreement of 150,000 shares of the Company's common stock
under the Company's 2007 Stock Incentive Plan. The Company will pay all
amounts necessary to satisfy taxes that may be payable by Mr. Chestnov as a
result of the issuance of the stock award.
The employment agreement also provides that on January 15, 2010, Mr.
Chestnov will receive a restricted stock award of 100,000 additional shares
of common stock under the 2007 Stock Incentive Plan, subject to stockholder
approval of an increase in the number of shares that may be issued under
that plan. The terms of this restricted stock award, which will be set
forth in a restricted stock award contract between the Company and Mr.
Chestnov, provide that 25,000 of the restricted award shares will vest on
January 15, 2010, with the remaining 75,000 restricted award shares vesting
pro rata in three annual installments beginning on January 15, 2011.
However, if Mr. Chestnov's employment is terminated for any reason (except
as described below), and in certain other circumstances, he must forfeit to
the Company the restricted award shares that have not yet vested. The
Company will pay all amounts necessary to satisfy taxes that may be payable
by Mr. Chestnov as a result of the issuance of the restricted stock award.
Upon a termination of the employment agreement by Mr. Chestnov for good
reason, as defined in the employment agreement, Mr. Chestnov will be
entitled to receive a lump sum payment in an amount equal to two times his
base salary at the annual rate in effect on the date of termination, any
accrued and unpaid bonus compensation, and any other accrued and unpaid
amounts to which Mr. Chestnov is entitled through the date of termination,
and all non-vested restricted stock award shares will immediately vest. In
addition, in the event of a change of control, as defined in the agreement,
Mr. Chestnov will be entitled to terminate the employment agreement and
receive a lump sum payment in an amount equal to two times his base salary
at the annual rate in effect on the date of termination, and all non-vested
restricted stock award shares will immediately vest.
In the event of a termination by the Board of Directors of the Company as a
result of Mr. Chestnov's disability, he will be entitled to receive his
base salary for the remainder of that calendar year (but not less than
one-half of his base salary), his minimum bonus for that year and all other
amounts to which he was entitled for portion of the year up to his
termination. In the event of Mr. Chestnov's death, Mr. Chestnov's legal
representatives will be entitled to receive the same amounts that Mr.
Chestnov would have been entitled to receive for a termination as a result
of Mr. Chestnov's disability.
The employment agreement also contains provisions prohibiting Mr. Chestnov,
during the term of his employment and for a period of the earlier of (i)
one year following his employment or (ii) the Company's bankruptcy, from
(a) soliciting for hiring, or hiring, any employee, consultant or other
person employed or affiliated with the Company, (b) interfering with the
Company's relationships with its suppliers, customers, lessors or other
persons or entities and (c) competing with the Company.
Forward Looking Statements
Note: This press release contains information concerning, among
other things, our future plans and objectives that are or may be deemed to
be forward-looking statements. However, forward-looking statements are
subject to a number of known and unknown risks and uncertainties that may
cause our actual results, trends, performance or achievements, or industry
trends and results, to differ materially from the future results, trends,
performance or achievements expressed or implied by such forward-looking
statements. Those risks and uncertainties may include, but are not limited
to, general economic and business conditions (including the ongoing
financial downturn and disruptions in credit markets); competition;
potential changes in customer spending; acceptance of our product offerings
and designs; the variability of consumer spending resulting from changes in
domestic economic activity; a highly promotional retail environment; any
significant variations between actual amounts and the amounts estimated for
those matters identified as our critical accounting estimates as well as
other significant accounting estimates made in the preparation of our
financial statements; and the impact of current and potential hostilities
in the Middle East and in other geographic areas; as well as other
geopolitical concerns. You are urged to consider all such factors. In
light of the uncertainty inherent in such forward-looking statements, you
should not consider their inclusion to be a representation that such
forward-looking matters will be achieved. We assume no obligation for
updating any such forward-looking statements to reflect actual results,
changes in assumptions or changes in other factors affecting such
forward-looking statements.
Jaclyn, Inc. is a designer, manufacturer and marketer of apparel, women's
sleepwear, infants' and children's apparel, handbags, premiums and related
accessories. Our web site is at www.jaclyninc.com.