EXHIBIT 10.2
[LETTERHEAD OF ST. JOHN KNITS, INC.]
July 8, 1996
Mrs. Cindy Sumner
176 Essay
Newport Coast, CA 92657
Dear Cindy:
On behalf of St. John Knits, Inc. ("St. John" or the "Company"), I am pleased to
confirm our offer of employment as Senior Vice President of Operations. The
terms and conditions of your employment are as follows:
(1) As Senior Vice President of Operations, you will generally be responsible
for operations at our headquarters. These responsibilities may be changed from
time to time as appropriate. Initially, you will report to Bob Gray, Chairman.
(2) Your starting base salary will be $14,583.34 per month or $175,000.00 on an
annualized basis, less applicable withholdings and deductions, paid on the
Company's regular payroll dates. Your salary will be reviewed from time to time
and may be adjusted (up or down) at the Company's discretion in light of the
Company's performance, your performance, market conditions and other conditions
deemed relevant by the Company. You are also eligible for a monthly expense
amount, performance or discretionary bonus, and stock options at discretion of
Company.
(3) In addition to your base compensation and specified perquisites, you will
also be eligible for 2 weeks vacation for the first year, holidays, sick pay,
and other employee benefits, all under the terms of the then-existing Company
policies, commensurate with other employees at the same level as you. Should you
not be covered by your husband's health insurance policy, you will be eligible
for coverage under the St. John policies. A clothing allowance of $2,000.00
immediately, $5,000.00 for Fall '96 and $5,000.00 per year subsequently.
(4) In accordance with our policies and state and federal law, this offer of
employment is contingent upon your successful completion of all requirements to
establish the legal right to work in the United States.
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(5) Your employment is for an unspecified term and is to continue only at the
mutual will of both you and the Company. This means that either you or the
Company may terminate the employment relationship at will at any time, for any
reason, with or without cause or notice. This at-will aspect of your employment,
which includes the right of the Company to demote, transfer or otherwise
discipline with or without cause or notice, may not be modified, amended or
rescinded except by an individual written agreement to the contrary signed by
both you and the Chairman of the Company.
(6) Nevertheless, if St. John elects to terminate your employment without cause
during the first twelve (12) months of service, the Company will continue to pay
your base salary (but not any other compensation or benefits) on its regular
payroll dates for a period of 120 days.
(7) You will be required to observe St. John's personnel and business policies
and procedures as they are in effect from time to time. In the event of any
conflict, the terms of this letter will control.
(8) St. John owns certain trade secrets and other confidential and/or
proprietary information. Except as required in the performance of your duties,
you will not at any time during or after your employment use, disclose or
disseminate any such information relating to the Company, or its products,
methods or procedures. This includes the list of names of suppliers and garment
contractors who have relationships with St. John, and other particularized
information concerning the products, finances, processes, material preferences,
fabrics, designs, material sources, pricing information, production schedules,
marketing strategies, merchandising strategies, and order forms. You shall
deliver to the Company any and all copies of confidential information, or other
Company property, upon the termination of the employment relationship, or at any
other time upon the Company's request.
(9) To the fullest extent allowed by law, any controversy, claim or dispute
between you and the Company (and/or any of its directors, officers, employees or
agents) relating to or arising out of your employment or the cessation of your
employment will be submitted to final and binding arbitration in Orange County,
California, for determination in accordance with the Employment Dispute
Resolution Rules of the American Arbitration Association as the exclusive remedy
for such controversy, claim or dispute. Possible disputes covered by the above
include (but are not limited
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to) wage, contract, discrimination, and other employment-related claims under
laws known as Title VII of the Civil Rights Act, the California Fair Employment
and Housing Act, Americans With Disabilities Act, Age Discrimination in
Employment Act, and any other statutes or laws relating to an employee's
relationship with her employer. However, claims for workers' compensation
benefits and unemployment insurance are not covered by this arbitration
agreement, and such claims may be presented by you to the appropriate court or
state agency as provided by California law. Judgment on the award issued by the
arbitrator may be entered in any court having jurisdiction thereof.
(10) This letter and the terms and conditions of employment contained herein
supersede and replace any prior understandings or discussions between you and
the Company regarding your employment. This letter sets forth the complete
agreement between you and the Company regarding your employment, and may only be
amended by a writing signed by you and the Chairman.
(11) We look forward to your starting work at the Company Headquarters in
Irvine no later than August 15, 1996, and sooner if you so desire.
Please sign, date and return the enclosed copy of this letter to me for our
files to acknowledge your agreement with the above.
Sincerely,
ST. JOHN
BOB GRAY
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Bob Gray
Chairman
I ACCEPT ST. JOHN'S OFFER OF EMPLOYMENT UPON THE TERMS AND CONDITIONS SET FORTH
ABOVE.
Dated: July 8, 1996. /s/ CINDY SUMNER
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Cindy Sumner