Exhibit 10.(l)
EARLY RETIREMENT AGREEMENT
EARLY RETIREMENT AGREEMENT (the "Agreement") dated October
26, 1999 ("Effective Date") between Xxxxx X. Xxxx ("Employee")
and Xxxxx Shoe Company, Inc., a New York corporation ("Company").
WHEREAS, the Employee will reach his Retirement Date on
December 31, 1999; and
WHEREAS, the Company recognizes the value of the services
performed by the Employee during his period of employment with
the Company; and
WHEREAS, the Employee wishes to be assured that he will be
entitled to certain additional compensation and provided certain
benefits following his Retirement Date and upon his "Retirement
Payment Date" (as defined below); and
WHEREAS, the parties hereto wish to provide the terms and
conditions upon which the Company shall pay such additional
compensation and provide such benefits to the Employee after his
retirement; and
WHEREAS, the Employee wishes to have the additional
compensation and benefits provided for in this Agreement and, in
exchange for such additional compensation and benefits, is
willing to give to the Company, under certain circumstances, his
covenant not to compete;
NOW, THEREFORE, in consideration of the premises and of the
mutual promises herein contained, the parties hereto agree as
follows:
1. Definitions.
a. "Competitor" shall mean any person, firm,
corporation, partnership or other entity which in its prior
fiscal year had annual gross sales volume or revenues of
shoes of more than $20,000,000 or is reasonably expected to
have such sales or revenues in either the current fiscal
year or the next following fiscal year.
b. "Confidential Information" shall have the meaning
set forth in Section 6.
c. "Customer" shall mean any wholesale customer of
the Company which either purchased from the Company during
the one (1) year immediately preceding the Retirement Date,
or is reasonably expected by the Company to purchase from
the Company in the one (1) year period immediately following
the Retirement Date, more than $1,000,000 in shoes.
d. "Retirement Date" shall mean December 31, 1999.
e. "Retirement Payment Date" shall mean the earlier
of the Employee's death or June 30, 2001.
2. Payments and Benefits Upon Retirement. Upon and after
the Employee's Retirement Date, the following shall apply:
a. The Company shall pay to the Employee on his
Retirement Date (i) the full base salary earned by him
through the Retirement Date and unpaid on such date, plus
(ii) credit for any vacation earned by him but not taken at
the Retirement Date, plus (iii) all other amounts earned by
him and unpaid as of the Retirement Date. Additionally, the
Company shall pay to Employee his bonus for the Company's
fiscal year ending January 29, 2000 at the same time as
other such bonuses are paid to other employees of the
Company.
b. The Company shall continue to pay to the Employee
his base monthly salary at the highest rate in effect at any
time during the twelve months immediately preceding the
Retirement Date (including on a monthly basis beginning in
February 0000 xxx-twelfth of his targeted bonus for the
fiscal year ending January 31, 2001 which in the aggregate
is $247,500) until the Retirement Payment Date (even if he
dies during such eighteen month period). Such amounts shall
be paid in accordance with the Company's regular pay period
policy for its employees, and shall be counted in
determining Employee's benefits under the Xxxxx Shoe
Company, Inc. Executive Retirement Plan.
c. Employee will be considered to continue as an
employee of the Company from January 1, 2000 through June
30, 2001 solely for purposes of receiving benefits under the
Company's Incentive and Stock Compensation Plan of 1999
(except for purposes of the long-term performance-based
stock award, as explained more fully below), Executive
Retirement Plan, group life insurance program, and medical
and dental plans; provided, however, that it is expressly
understood and agreed that Employee's status as an Employee
of the Company for purposes of the group life insurance
program and medical and dental plans will terminate and
cease in all events immediately upon Employee's re-
employment before June 30, 2001 to the extent covered by his
new Employer's group life insurance, medical and dental
plans; provided further, that Employee shall be entitled to
receive one-third of his long-term performance-based stock
award for the three-year period ending on the last day of
the Company's 2001 fiscal year based on the Company's actual
results during such three-year performance period, such
award to be paid after the end of the Company's 2001 fiscal
year in accordance with normal practices. By virtue of the
fact that Employee is considered to continue in employment
from January 1, 2000 through the Retirement Payment Date,
for purposes of determining the Employee's benefit under the
Xxxxx Shoe Company, Inc. Executive Retirement Plan, an
additional 1.5 years of Credited Service (in addition to the
additional ten (10) years of Credited Service credited to
the Employee in accordance with Section A.5 of the Xxxxx
Shoe Company, Inc. Executive Retirement Plan) shall be
credited to the Employee's actual or deemed Credited
Service, even if he dies before the Retirement Payment Date.
Benefits under the Xxxxx Shoe Company, Inc. Executive
Retirement Plan shall commence as soon as practicable after
the Retirement Payment Date.
d. The Company, at its expense, shall provide to the
Employee, his spouse and any dependents (as long as such
individuals are under the age of 23), for a period beginning
on the Retirement Payment Date and ending upon the
Employee's attainment of age 65, medical and/or dental
coverage under the medical and dental plans maintained by
the Company or under an arrangement which provides benefits
substantially similar to those provided under the medical
and dental plans maintained by the Company. Upon the
Employee's re-employment during such period, to the extent
covered by his new employer's Plan, coverage under this
Section 2.c. shall lapse.
The Employee's participation in and/or coverage
under all other employee benefit plans, programs or
arrangements sponsored or maintained by the Company shall
cease effective as of the Retirement Payment Date.
e. With respect to each non-vested option to purchase
Company stock held by the Employee on the Retirement Payment
Date, the Company shall make a cash lump sum payment to the
Employee within 30 days after the Retirement Payment Date in
an amount equal to the excess, if any, of the fair market
value (determined as of the Retirement Payment Date) of the
Company stock subject to such option over the exercise price
of such option. In addition, any non-vested restricted
stock of the Company held by the Employee on the Retirement
Payment Date which would have vested if the Employee had
remained employed until age 65 shall vest on the Retirement
Payment Date.
f. During the period commencing on the Retirement
Date and ending on the earlier of the Retirement Payment
Date or the date the Employee secures other employment, the
Company shall pay the reasonable costs of outplacement
services selected by the Company and shall provide, at the
Company's expense, office space and secretarial service at a
non-Company facility.
g. The Company shall pay the Employee's federal and
state income tax preparation fees charged by a service
provider selected by the Employee for his taxable years 1999
and 2000.
h. The Company shall pay membership dues for the
Employee charged by the Bogey Club and the St. Louis Club,
both located in St. Louis, Missouri, until the Employee's
attainment of age 65 or his death, if earlier.
i. The Employee shall be given the opportunity to
purchase the Dell personal computer used by the Employee in
his employment with the Company at a purchase price equal to
the book value of the computer.
3. Mitigation or Reduction of Benefits. Employee shall
not be required to mitigate the amount of any payment provided
for in Section 2 by seeking other employment or otherwise.
Except as otherwise specifically set forth herein, the amount of
any payment or benefits provided in Section 2 shall not be
reduced by any compensation or benefits or other amounts paid to
or earned by Employee as the result of employment by another
employer after the Retirement Date or otherwise.
4. Release. Notwithstanding anything to the contrary
stated in this Agreement, no benefits will be paid pursuant to
Section 2 except under Section 2.a. prior to execution by
Employee of a release to the Company in the form attached as
Exhibit A.
5. Covenant Not to Compete. Benefits payable pursuant to
Section 2 (except under Section 2.a.) are subject to the
following restrictions.
a. Post-Retirement Restrictions.
i. Employee acknowledges that (i) the
Company has spent substantial money, time and effort
over the years in developing and solidifying its
relationships with its Customers throughout the world
and in developing its Confidential Information;
(ii) under this Agreement, the Company is agreeing to
provide Employee with certain benefits based upon
Employee's assurances and promises contained herein not
to divert the Company's Customers' goodwill or to put
himself in a position following his employment with
Company in which the confidentiality of Company's
Confidential Information might somehow be compromised.
ii. Accordingly, Employee agrees that, for
eighteen (18) months after the Retirement Date,
Employee will not, directly or indirectly, on
Employee's own behalf or on behalf of any other person,
firm, corporation or entity (whether as owner, partner,
consultant, employee or otherwise):
A. provide any executive- or
managerial-level services in the shoe industry in
the United States in competition with the Company,
for any Competitor;
B. hold any executive- or
managerial-level position with any Competitor in
the United States;
C. engage in any research and
development activities or efforts for a
Competitor, whether as an employee, consultant,
independent contractor or otherwise, to assist the
Competitor in competing in the shoe industry in
the United States;
D. cause or attempt to cause any
Customer to divert, terminate, limit, modify or
fail to enter into any existing or potential
relationship with the Company;
E. cause or attempt to cause any shoe
supplier or manufacturer of the Company to divert,
terminate, limit, modify or fail to enter into any
existing or potential relationship with the
Company; and
F. solicit, entice, employ or seek to
employ, in the shoe industry, any executive- or
managerial-level employee of, or any consultant or
advisor to, the Company.
b. Acknowledgment Regarding Restrictions. Employee
recognizes and agrees that the restraints contained in
Section 5.a. (both separately and in total) are reasonable
and should be fully enforceable in view of the high-level
positions Employee has had with the Company, the national
and international nature of both the Company's business and
competition in the shoe industry, and the Company's
legitimate interests in protecting its Confidential
Information and its Customer goodwill and relationships.
Employee specifically hereby acknowledges and confirms that
he is willing and intends to, and will, abide fully by the
terms of Section 5.a. of this Agreement. Employee further
agrees that the Company would not have adequate protection
if Employee were permitted to work for its Competitors in
violation of the terms of this Agreement since the Company
would be unable to verify whether (i) its Confidential
Information was being disclosed and/or misused, and
(ii) Employee was involved in diverting or helping to divert
the Company's Customers and/or its Customer goodwill.
c. Company's Right to Injunctive Relief. In the
event of a breach or threatened breach of any of Employee's
duties and obligations under the terms and provisions of
Section 5.a. of this Agreement, the Company shall be
entitled, in addition to any other legal or equitable
remedies it may have in connection therewith (including any
right to damages that it may suffer), to temporary,
preliminary and permanent injunctive relief restraining such
breach or threatened breach. Employee hereby expressly
acknowledges that the harm which might result to Company's
business as a result of noncompliance by Employee with any
of the provisions of Section 5.a. would be largely
irreparable. Employee specifically agrees that if there is
a question as to the enforceability of any of the provisions
of Section 5.a. hereof, Employee will not engage in any
conduct inconsistent with or contrary to such Section until
after the question has been resolved by a final judgment of
a court of competent jurisdiction. Employee undertakes and
agrees that if Employee breaches or threatens to breach the
Agreement, Employee shall be liable for any attorneys' fees
and costs incurred by Company in enforcing its rights
hereunder.
d. Employee Agreement to Disclose this Agreement.
Employee agrees to disclose, during the eighteen month
period following the Retirement Date, the terms of this
Section 5 to any potential future employer.
6. Confidential Information. The Employee acknowledges
and confirms that certain data and other information (whether in
human or machine readable form) that comes into his possession or
knowledge (whether before or after the date of this Agreement)
and which was obtained from the Company, or obtained by the
Employee for or on behalf of the Company, and which is identified
herein, is the secret, confidential property of the Company (the
"Confidential Information"). This Confidential Information
includes, but is not limited to:
a. lists or other identification of customers or
prospective customers of the Company (and key individuals
employed or engaged by such parties);
b. lists or other identification of sources or
prospective sources of the Company's products or components
thereof (and key individuals employed or engaged by such
parties);
c. all compilations of information, correspondence,
designs, drawings, files, formulae, lists, machines, maps,
methods, models, notes or other writings, plans, records,
regulatory compliance procedures, reports, specialized or
technical data, schematics, source code, object code,
documentation, and software used in connection with the
development, manufacture, fabrication, assembly, marketing
and sale of the Company's products;
d. financial, sales and marketing data relating to
the Company or to the industry or other areas pertaining to
the Company's activities and contemplated activities
(including, without limitation, manufacturing,
transportation, distribution and sales costs and non-public
pricing information);
e. equipment, materials, procedures, processes, and
techniques used in, or related to, the development,
manufacture, assembly, fabrication or other production and
quality control of the Company's products and services;
f. the Company's relations with its Customers,
prospective customers, suppliers and prospective suppliers
and the nature and type of products or services rendered to
such Customers (or proposed to be rendered to prospective
customers);
g. the Company's relations with its employees
(including, without limitation, salaries, job
classifications and skill levels); and
h. any other information designated by the Company to
be confidential, secret and/or proprietary (including
without limitation, information provided by customers or
suppliers of the Company).
Notwithstanding the foregoing, the term "Confidential
Information" shall not consist of any data or other information
which has been made publicly available or otherwise placed in the
public domain other than by the Employee in violation of this
Agreement.
7. Notice. All notices hereunder shall be in writing and
shall be deemed to have been duly given (a) when delivered
personally or by courier, or (b) on the third business day
following the mailing thereof by registered or certified mail,
postage prepaid, or (c) on the first business day following the
mailing thereof by overnight delivery service, in each case
addressed as set forth below:
a. If to the Company
Xxxxx Shoe Company, Inc.
0000 Xxxxxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000-0000
Attention: Chief Executive Officer
b. If to Employee:
Xxxxx X. Xxxx
000 Xxxx Xxxx
Xxxxx, XX 00000
Any party may change the address to which notices are to be
addressed by giving the other party written notice in the manner
herein set forth.
8. Successors; Binding Agreement.
a. The Company will require any successor (whether
direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business
and/or assets of the Company, upon or prior to such
succession, to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that the
Company would have been required to perform it if no such
succession had taken place. A copy of such assumption and
agreement shall be delivered to Employee promptly after its
execution by the successor. As used in this Agreement,
"Company" shall mean the Company as hereinbefore defined and
any successor to its business and/or assets as aforesaid
which executes and delivers the agreement provided for in
this Section 8.a. or which otherwise becomes bound by the
terms and provisions of this Agreement by operation of law.
b. This Agreement is personal to the Employee and the
Employee may not assign or delegate any part of his rights
or duties hereunder to any other person, except that this
Agreement shall inure to the benefit of and be enforceable
by the Employee's legal representatives, executors,
administrators, heirs and beneficiaries.
9. Severability. If any provision of this Agreement or
the application thereof to any person or circumstance shall to
any extent be held to be invalid or unenforceable, the remainder
of this Agreement and the application of such provision to
persons or circumstances other than those as to which it is held
invalid or unenforceable shall not be affected thereby, and each
provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.
10. Headings. The headings in this Agreement are inserted
for convenience of reference only and shall not in any way affect
the meaning or interpretation of this Agreement.
11. Counterparts. This Agreement may be executed in one or
more identical counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the
same instrument.
12. Waiver. Neither any course of dealing nor any failure
or neglect of either party hereto in any instance to exercise any
right, power or privilege hereunder or under law shall constitute
a waiver of such right, power or privilege or of any other right,
power or privilege or of the same right, power or privilege in
any other instance. All waivers by either party hereto must be
contained in a written instrument signed by the party to be
charged therewith, and, in the case of the Company, by its duly
authorized officer.
13. Entire Agreement. This instrument constitutes the
entire agreement of the parties in this matter and shall
supersede any other agreement between the parties, oral or
written, concerning the same subject matter. Without limiting
the generality of the foregoing, all amounts paid under the
Agreement are provided in lieu of any amounts or benefits to
which the Employee is or could possibly be entitled under the
Severance Agreement executed by the parties on July 27, 1998.
14. Amendment. This Agreement may be amended only by a
writing which makes express reference to this Agreement as the
subject of such amendment and which is signed by the Employee and
by a duly authorized officer of the Company.
15. Governing Law. In light of the Company's and the
Employee's substantial contacts with the State of Missouri, the
facts that the Company is headquartered in Missouri and the
Employee resides in and/or reported to management in Missouri
during his employment with the Company, the parties' interests in
ensuring that disputes regarding the interpretation, validity and
enforceability of this Agreement are resolved on a uniform basis,
and Company's execution of, and the making of, this Agreement in
Missouri, the parties agree that: (i) any litigation involving
any noncompliance with or breach of the Agreement, or regarding
the interpretation, validity and/or enforceability of the
Agreement, shall be filed and conducted exclusively in the state
or federal courts in St. Louis City or County, Missouri; and (ii)
the Agreement shall be interpreted in accordance with and
governed by the laws of the State of Missouri, without regard for
any conflict of law principles.
IN WITNESS WHEREOF, the Employee and the Company have
executed this Agreement as of the day and year first above
written.
XXXXX SHOE COMPANY, INC.
By: /s/ Xxxxxx X. Xxxxxx.
----------------------------------
XXXXXX X. XXXXXX.
Vice President, General Counsel
and Corporate Secretary
EMPLOYEE
By: /s/ Xxxxx X. Xxxx
----------------------------------
Xxxxx X. Xxxx
Exhibit A
RELEASE
RELEASE (the "Release") dated October 26, 1999 between Xxxxx
X. Xxxx ("Employee") and Xxxxx Shoe Company, Inc., a New York
corporation (as further defined in Section 7 of the Early
Retirement Agreement, the "Company").
WHEREAS, the Company and the Employee are parties to an
Early Retirement Agreement dated October 26, 1999 (the "Early
Retirement Agreement"), which provides certain additional
compensation and benefits to the Employee following his
retirement from the service of the Company; and
WHEREAS, the execution of this Release is a condition
precedent to, and material inducement to, the Company's provision
of certain benefits under the Early Retirement Agreement;
NOW, THEREFORE, the parties hereto agree as follows:
1. Mutual Promises. The Company undertakes the
obligations contained in the Early Retirement Agreement in
exchange for Employee's promises and obligations contained
herein. The Company's obligations are undertaken in lieu of any
other severance benefits, including, but not limited to, the
benefits provided under the Severance Agreement executed by the
parties on July 27, 1998.
2. Release of Claims; Agreement Not to File Suit.
a. Employee, for and on behalf of himself and his heirs,
beneficiaries, executors, administrators, successors,
assigns and anyone claiming through or under any of the
foregoing, agrees to, and does, remise, release and forever
discharge the Company and its subsidiaries and affiliates,
each of their shareholders, directors, officers, employees,
agents and representatives, and its successors and assigns
(collectively, the "Company Released Persons"), from any and
all matters, claims, demands, damages, causes of action,
debts, liabilities, controversies, judgments and suits of
every kind and nature whatsoever, foreseen or unforeseen,
known or unknown, which have arisen or could arise from
matters which occurred prior to the date of this Release,
which matters include without limitation: (i) the matters
covered by the Early Retirement Agreement and this Release,
(ii) Employee's employment and/or termination from
employment with the Company, and (iii) any claims which
might otherwise arise in the future as a result of
arrangements or agreements in effect as of the date of this
Release or the continuance of such arrangements and
agreements.
b. Employee, for and on behalf of himself and his heirs,
beneficiaries, executors, administrators, successors,
assigns, and anyone claiming through or under any of the
foregoing, agrees that he will not file or otherwise submit
any charge, claim, complaint, or action to any agency,
court, organization, or judicial forum (nor will Employee
permit any person, group of persons, or organization to take
such action on his behalf) against any Company Released
Person arising out of any actions or non-actions on the part
of any Company Released Person arising before the date of
this Release or any action taken after the date of this
Release pursuant to the Early Retirement Agreement.
Employee further agrees that in the event that any person or
entity should bring such a charge, claim, complaint, or
action on his behalf, he hereby waives and forfeits any
right to recovery under said claim and will exercise every
good faith effort to have such claim dismissed.
c. The charges, claims, complaints, matters, demands,
damages, and causes of action referenced in Sections 2.a.
and 2.b. include, but are not limited to: (i) any breach of
an actual or implied contract of employment between Employee
and any Company Released Person, (ii) any claim of unjust,
wrongful, or tortuous discharge (including any claim of
fraud, negligence, retaliation for whistleblowing, or
intentional infliction of emotional distress), (iii) any
claim of defamation or other common law action, or (iv) any
claims of violations arising under the Civil Rights Act of
1964, as amended, 42 U.S.C. Sec. 2000e et seq., the Age
Discrimination in Employment Act, 29 U.S.C. Sec. 621 et seq.,
the Americans with Disabilities Act of 1990, 42 U.S.C.
Sec. 12101 et seq., the Fair Labor Standards Act of 1938, as
amended, 29 U.S.C. Sec. 201 et seq., the Rehabilitation Act of
1973, as amended, 29 U.S.C. Sec. 701 et seq., or of the Missouri
Human Rights Act, Sec. 213.000 R.S. Mo. et seq., the Missouri
Service Letter Statute, Sec. 209.140 R.S. Mo. or any other
relevant federal, state, or local statutes or ordinances, or
any claims for pay, vacation pay, insurance, or welfare
benefits or any other benefits of employment with any
Company Released Person arising from events occurring prior
to the date of this Release other than those payments and
benefits specifically provided in the Early Retirement
Agreement.
d. This Release shall not affect Employee's right to any
governmental benefits payable under any Social Security or
Worker's Compensation law now or in the future.
3. Release of Benefit Claims. Employee, for and on behalf
of himself and his heirs, beneficiaries, executors,
administrators, successors, assigns and anyone claiming through
or under any of the foregoing, further releases and waives any
claims for pay, vacation pay, insurance or welfare benefits or
any other benefits of employment with any Company Released Person
arising from events occurring prior to the date of this Release
other than claims to the payments and benefits specifically
provided for in the Early Retirement Agreement.
4. Revocation Period; Knowing and Voluntary Agreement.
a. Employee acknowledges that he was given a copy of this
Agreement when the Early Retirement Agreement was executed
and he, therefore, has been given a period of at least
twenty-one (21) days to consider whether or not to accept
this Agreement. Furthermore, Employee may revoke this
Agreement for seven (7) days following its execution.
b. Employee represents, declares and agrees that he
voluntarily accepts the payments described above for the
purposes of making a full and final compromise, adjustment
and settlement of all potential claims hereinabove
described. Employee hereby acknowledges that he has been
advised of the opportunity to consult an attorney and that
he understands the Release and the effect of signing the
Release.
5. Severability. If any provision of this Release or the
application thereof to any person or circumstance shall to any
extent be held to be invalid or unenforceable, the remainder of
this Release and the application of such provision to persons or
circumstances other than those as to which it is held invalid or
unenforceable shall not be affected thereby, and each provision
of this Release shall be valid and enforceable to the fullest
extent permitted by law.
6. Headings. The headings in this Release are inserted
for convenience of reference only and shall not in any way affect
the meaning or interpretation of this Release.
7. Counterparts. This Release may be executed in one or
more identical counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the
same instrument.
8. Entire Agreement. This Release and related Early
Retirement Agreement constitutes the entire agreement of the
parties in this matter and shall supersede any other agreement
between the parties, oral or written, concerning the same subject
matter.
9. Governing Law. This Release shall be governed by, and
construed and enforced in accordance with, the laws of the State
of Missouri, without reference to the conflict of laws rules of
such State.
IN WITNESS WHEREOF, Employee and the Company have executed
this Release as of the day and year first above written.
XXXXX SHOE COMPANY, INC.
By: /s/ Xxxxxx X. Xxxxxx.
----------------------------------
XXXXXX X. XXXXXX.
Vice President, General Counsel
and Corporate Secretary
EMPLOYEE
By: /s/ Xxxxx X. Xxxx
----------------------------------
Xxxxx X. Xxxx
