EXHIBIT 99.1
May 2, 2005
Robin Marino
Dear Robin:
We are very pleased and excited to extend and offer to you to join Martha
Stewart Living Omnimedia, Inc ("MSO") as described below:
1) POSITION: You will serve in a full-time capacity as an MSO employee with
the title of President-Merchandising, in the Merchandising segment, subject
to review on an annual basis.
2) TERM: You shall begin work effective on a date to be determined (the "Start
Date"), and your employment shall continue until terminated by either you
or MSO (the "Term"), subject to the terms of paragraph 14 entitled
"Severance".
3) DUTIES: During the Term, you will devote your full business time,
attention and energies to the performance of duties included in the
attached job description and such other duties as may be reasonably
assigned to you and which are consistent with your titles. In performing
your duties you will report directly to the CEO & President, or other
position(s) as MSO deems appropriate. It will be your responsibility to
keep that office informed on a timely basis and as directed on your
progress with respect to your duties hereunder.
4) COMPENSATION: You will be paid a salary at the annual rate of not less than
$495,000, payable as earned, in 26 equal payments of $19,038.46 in
accordance with MSO's standard payroll practices for salaried employees.
Your MSO compensation level is Grade 39. In a manner consistent with other
MSO senior executives, you will be eligible for salary increases based upon
your performance and the performance of MSO as the then-current policies of
MSO provide for executives at your level.
5) BONUS: Provided you continue to be employed by MSO at the time annual
bonuses are paid, you will be eligible for an annual target bonus of 70% of
your base salary, pursuant to company policies. In general, your bonus will
be determined based upon MSO's customary practices in effect from time to
time with respect to bonus determination for executives of comparable
level, and is based upon management's evaluation of your performance as
President-Merchandising, as well as the performance of MSO against certain
goals and targets set by MSO's Executive Office, the Board of Directors
and/or the Compensation Committee thereof. Your 2005 bonus is guaranteed to
be paid at the end of February 2006, in the amount of $250,000.
6) SIGNING BONUS: We will pay you a signing bonus of $328,000, in accordance
with MSO's standard payroll practices, of which will be payable within 15
days of your start date. In the event you voluntarily leave MSO's
employment within the first six months thereof, you will be obligated to
repay this amount in full to MSO. In the event you leave voluntarily after
six months and before twelve months of employment you will repay 50% of the
amount to MSO.
7) BENEFITS: You will be eligible for all employment benefits provided by MSO
subject to the terms and conditions of any relevant benefits plan document
and MSO's then-current policy (which may be changed by MSO from time to
time), which presently entitles you to coverage as of your first day of
work.
8) LONG-TERM INCENTIVE PLANS: As of your start date, you will be granted
45,000 shares of restricted stock (the "Award") under the Amended and
Restated 1999 Stock Incentive Plan (the "Plan"). The Award represents the
right to receive shares of MSO Class A common stock on the respective
vesting dates. The Award will vest over three years, with thirty-three
percent (33%) vesting on your first anniversary, thirty-three percent (33%)
vesting on your second anniversary, and the remaining thirty-four percent
(34%) vesting on your third anniversary. Except as may otherwise be
provided in the Plan or in the Martha Stewart Living Omnimedia, Inc. 2005
Executive Severance Pay Plan (the "Severance Plan"), you must be employed
by MSO on the respective vesting date in order to receive that portion of
the Award. You will be granted an additional 12,500 shares of restricted
stock on or around January 1, 2006, if you remain employed by MSO at that
time. This award will vest in accordance with the then current policy in
effect for other Senior Executives of MSO.
9) VACATION: You will be entitled to four (4) weeks vacation annually in
accordance with company policy for Executives.
10) NON-COMPETITION: You hereby agree that during your employment with MSO and
during any Tail Period (as defined below), you shall not engage in or
become associated with a Competitive Activity (as defined below). A
"Competitive Activity" shall mean any
business that MSO has a contractual relationship during the twelve month
period prior to your termination with respect to which you performed any
material duties during your employment with MSO and its affiliates and
their predecessors. You shall be deemed to be "engaged in or associated
with a Competitive Activity" if you become an owner, employee, officer,
director, independent contractor, agent, partner, advisor, or render
personal services in any other capacity, with or for any individual,
partnership, corporation or other organization (collectively, an
"Enterprise") that is engaged in a Competitive Activity, provided, however,
that you shall not be prohibited from (a) owning less than five percent of
the stock in any publicly traded Enterprise engaging in a Competitive
Activity, or (b) being an employee, independent contractor or otherwise
providing services to an Enterprise that is engaged in a Competitive
Activity so long as your services relate to an aspect or endeavor of such
Enterprise that is distinct from, and unrelated to, and you have no
influence or control over, such Enterprise's pursuit of a Competitive
Activity. "Tail Period" shall mean the period, if any, commencing on the
date that your employment with MSO terminates, and ending on the
twelve-month anniversary of such date. If, at any time, the provisions of
this paragraph shall be determined to be invalid or unenforceable, by
reason of being vague or unreasonable as to area, duration or scope of
activity, this paragraph shall be considered divisible and shall become and
be immediately amended to only such area, duration and scope of activity as
shall be determined to be reasonable and enforceable by the court or other
body having jurisdiction over the matter; and you agree that this paragraph
as so amended shall be valid and binding as though any invalid or
unenforceable provision had not been included herein. You agree that the
remedies at law for any breach or threat of breach by you of this paragraph
will be inadequate, and that, in addition to any other remedy to which MSO
may be entitled at law or in equity, MSO will be entitled to seek a
temporary or permanent injunction or injunctions or temporary restraining
order or orders to prevent breaches thereof. Your such agreement shall not
be deemed to prohibit you from opposing such relief on the basis of a
dispute of facts related to any such application.
11) CONFIDENTIALITY: You agree to sign the MSO confidentiality agreement upon
hire.
12) AT WILL STATUS: You specifically understand and agree that your employment
hereunder shall be at all times on an "at will" basis, meaning that either
you or MSO can terminate your employment at any time and for any reason,
with or without cause or notice, and nothing contained herein shall be
construed as establishing any other relationship between you and MSO.
13) WORK FOR HIRE: As an MSO employee, you will be part of a team of highly
talented individuals, whose creative contributions are an integral part of
MSO's success as a company. Accordingly, you acknowledge and agree that MSO
has specially ordered and commissioned any and all results and proceeds of
your services hereunder (the "works") as works-made-for-hire under the
United States copyright Act and all similar laws throughout the world (the
"Act"), and that MSO shall be deemed the sole author and owner of all
right, title and interest in the Works in any an all languages, formats and
media, whether now known or hereafter created, throughout the world in
perpetuity (the "Rights"). If the Works or any part of the Works are not
deemed works-made-for-hire under the Act, you hereby irrevocably grant and
assign the Rights exclusively to MSO. You hereby waive any so-called moral
rights of authors and other similar rights in connection with the Works.
You acknowledge and agree that MSO is not under any obligation to use the
Works, and may exploit, reproduce, distribute, make derivative works of,
alter or edit the Works or combine the Works with other materials, in any
media whether now known or hereafter created throughout the world, in MSO's
sole discretion, free of any obligation to you whatsoever, financial or
otherwise. You hereby waive the right to seek or obtain any injunctive or
other equitable relief in connection with MSO's exploitation of the Works
and any Rights therein. You agree that upon any termination of your
employment, you will immediately turn over any and all of the Works in your
possession to MSO. You irrevocably grant to MSO the perpetual right to use
and authorize others to use your name, biographical information,
photograph, and likeness (in each case in a form approved by you) in
connection with any use of the Works and/or in connection with your
employment with MSO. You represent and warrant that you have the right to
perform your services for MSO and to grant the Rights in the Works to MSO,
and that, to the best of your knowledge, the Works will be original with
you, and neither the Works, nor MSO's exercise of any of the Rights, shall
violate or otherwise conflict with the rights of any person or entity.
14) SEVERANCE: You will be a participant in the 2005 Executive Severance Plan
(attached). Notwithstanding the provisions of Section 2.04 of the Severance
Plan, Section 1 (b) of the Restricted Stock Award Agreement with respect to
the initial grant shall apply in the event of your Death or Disability.
15) PERSONAL ASSISTANT: You shall have the right to hire a personal assistant
of your choosing and, notwithstanding the provisions of Section 2.03 of the
Severance Plan, you shall not be prohibited from taking your personal
assistant with you upon termination of your employment for any reason.
We hope that you find the foregoing terms acceptable. You may indicate your
agreement with these terms and accept this offer by signing this letter as well
as the confidentiality agreement and returning them to me.
Robin, all of us are very excited at the prospect of having you on the
Martha Stewart Living Omnimedia team. We think that you will enjoy our highly
creative and collaborative atmosphere, and we know that we will enjoy having you
here.
Very truly yours,
/s/ James Follo
James Follo
Chief Financial and Administrative Officer
Martha Stewart Living Omnimedia, Inc.
ACCEPTED AND AGREED:
/s/ Robin Marino
Robin Marino
Date: May 2, 2005
MARTHA STEWART LIVING OMNIMEDIA, INC.
JOB DESCRIPTION
Position Title: President- Merchandising
Reports to: President and Chief Executive Officer
Primary Responsibility: Primarily responsible for growth of existing
licensed product programs, as well as the
development of new product programs both within
existing license agreements and the development of
programs with new license partners.
Principal duties: Overall responsibility for Merchandising segment
performance and growth, including development of
long-term business plans and annual budgets.
Develop new product categories that will leverage
off existing product lines and create new
categories.
Develop and maintain relationships with senior
management of licensing partners.
Infuse and retain strong sense of brand vision
throughout the design and presentation of all
products.
Insure compliance with terms and conditions of all
licensing agreements.
Insure that product quality is maintained across
all licensed products.
Manage execution of all new product launches
Develop marketing and public relation plans for
all licensed products
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