FOURTH AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Exhibit 10.2
FOURTH AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS FOURTH AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) is entered into and
made effective as of October 25, 2010, by and between THE MEN’S WEARHOUSE, INC., a Texas
corporation (the “Company”), and XXXXX X. XXXXX (“Employee”), amending and restating the Employment
Agreement dated February 3, 2002, as amended and restated by the Amended and Restated Employment
Agreement dated February 3, 2003, as amended and restated by the Second Amended and Restated
Employment Agreement dated October 1, 2005 and as amended and restated by the Third Amendment and
Restated Employment Agreement dated January 1, 2009 (the “Third Amended and Restated Agreement”).
WHEREAS, the Company and Employee desire to amend the Third Amended and Restated Agreement;
WHEREAS, the Company and Employee have entered into that certain Change in Control Agreement
dated as of May 15, 2009 (the “Change in Control Agreement”);
NOW THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth,
the Company and Employee hereby agree to amend and restate the Third Amended and Restated Agreement
to read as follows:
1. Employment and Duties. The Company hereby agrees to employ Employee as Vice
Chairman of the Board, and Employee hereby accepts such employment and agrees to serve the Company
in such capacity on the terms and subject to the conditions set forth in this Agreement. Subject
to the ultimate direction and control of the Chairman of the Board and Chief Executive Officer of
the Company and to the Company’s Board of Directors, Employee shall assist the Chairman of the
Board and Chief Executive Officer with the strategic direction of the Company and assist with the
implementation of the business plan of the Company and, in connection therewith, will interact with
and provide guidance to the other executive officers of the Company. During his employment
hereunder, Employee shall devote more of his business time, energy, and ability to the business and
interests of the Company than to any other single business or group of related businesses. During
his employment hereunder, Employee may render services for compensation and engage in other
business activity without the prior consent of the Company, provided rendering such services or
engaging in such activity does not violate Section 10 or 11 of this Agreement and provided that
Employee must continue to devote more of his working time to the Company than to any other single
business or group of related businesses.
2. Compensation and Benefits of Employment.
(a) As compensation for the services to be rendered by Employee hereunder, the Company shall
pay to Employee a base annual salary (“Annual Salary”) of $300,000 per year through the Company’s
2010 fiscal year and $395,000 per year thereafter, in equal installments in accordance with the
customary payroll practices of the Company. The parties shall comply with all applicable
withholding requirements in connection with all compensation payable to Employee. The Company’s
Board of Directors may, in its sole discretion, review and adjust
upward Employee’s Annual Salary from time to time, but no downward adjustment in Employee’s
Annual Salary may be made during the term of this Agreement.
(b) Employee shall be entitled to participate in and have the benefits under the terms of all
life, accident, disability and health insurance plans, pension, profit sharing, incentive
compensation and savings plans and all other similar plans and benefits which the Company from time
to time makes available to its senior management executives in the same manner and at least at the
same participation level as other senior management executives, excluding, however, the Company’s
annual cash bonus program for executive officers and grants and awards under the Company’s key
employee equity incentive plans, awards under which to Employee, if any, shall be wholly at the
discretion of the Company.
(c) The Company shall grant to the Employee on February 5, 2011, 96,800 shares of Restricted
Stock (the “Restricted Stock”) pursuant to a restricted stock award agreement (the “Award
Agreement”), which shall vest in equal numbers of 19,360 on each February 5th in 2012
through 2016. The terms of the Award Agreement shall provide that in the event of termination of
Employee’s employment, other than for “cause”, as described in Section 7, or by reason of voluntary
termination as described in Section 8, a number of unvested shares of Restricted Stock shall
immediately vest equal to 19,360 times a fraction the numerator of which shall be the sum of (i)
the number of days from and including the most recent February 6 to and including the Termination
Date (as defined below) and (ii) the greater of 365 or the number of days from the Termination
Date to and including February 5, 2013, and the denominator of which shall be 365; any other
unvested shares of Restricted Stock shall immediately terminate and be of no further force or
effect. The terms of the Award Agreement shall further provide that, in the event of termination
of Employee’s employment for “cause”, as described in Section 7, or by reason of voluntary
termination as described in Section 8, all unvested shares of Restricted Stock shall immediately
terminate and be of no further force or effect.
3. Business Expenses. The Company shall promptly reimburse Employee for all
appropriately documented, reasonable business expenses incurred by Employee in accordance with the
Company’s policies related thereto.
4. Term. Employee’s employment under this Agreement shall have a continuing term
until the close of business on February 5, 2013; provided that at the end of such term, and in the
case of an extension term, if any, at the end of each extension term, this Agreement and the
employment of the Employee hereunder shall automatically extend for a one year term unless at least
six months and no more than seven months prior to the end of the term, either party gives written
notice to the other that the employment end at the end of the current term; and provided further
that in any event this Agreement and the employment of the Employee hereunder shall terminate at
the close of business on February 5, 2016.
5. Termination by the Company Without Cause or Termination by Employee for “Good Reason”
or notice of non-extension by Company.
(a) The Company may, by delivering 30 days prior written notice to Employee, terminate
Employee’s employment at any time without cause, and Employee may, by
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delivering 30 days prior written notice to the Company, terminate Employee’s employment at any
time for “good reason”, as defined in Section 5(b) below. If such termination without cause or for
good reason occurs, or if the Company notifies the Employee that the Company does not intend to
extend his employment hereunder at the end of the initial term or any extended term as provided in
Section 4, then:
(i) The Company shall pay to Employee, at the times specified in Section 5(a)(iv) below, the
following amounts:
(1) a lump sum in cash equal to (1) Employee’s Annual Salary earned through the date of
Employee’s termination of employment (the “Termination Date”) for periods through but not following
his Separation From Service (as defined in Section 5(c) below) and (2) any accrued vacation pay
earned by Employee, in each case, to the extent not theretofore paid (the “Accrued Obligation”);
(2) a lump sum in cash equal to Employee’s Annual Salary earned through the Termination Date
for periods following his Separation From Service, to the extent not theretofore paid;
(3) a lump sum in cash equal to the product of (1) the amount of the monthly basic life
insurance premium applicable to Employee’s basic life insurance coverage provided through the
Company’s life insurance plan immediately prior to the Termination Date and (2) the number of full
months and fractional months (if any) remaining until the earlier of February 6, 2016 or the second
anniversary of the Termination Date;
(4) cash installment payments each of which is equal to 1/52nd of the amount of the
Annual Salary at the rate in effect immediately prior to the Termination Date, for each week during
the period beginning on the Termination Date and ending on the earlier of February 6, 2016 or the
second anniversary of the Termination Date;
(5) cash installment payments of $1,250 for each week during the period beginning on the
earlier of February 6, 2016 or the second anniversary of the Termination Date and ending when
Employee reaches age 65, at which time the Company’s interest in the insurance policies referred to
in and covered by (A) the Split Dollar Agreement dated May 25, 1995, between Employee, Xxxxxx
Xxxxxx, as Trustee of the Xxxxx X. Xxxxx 1995 Irrevocable Trust, and the Company (the “First Split
Dollar Policy”) and (B) the Split Dollar Agreement dated May 25, 1995, between Employee, Xxxxxx
Xxxxxx, as Trustee of the Xxxxx X. Xxxxx 1995 Irrevocable Trust and the Company (the “Second Split
Dollar Policy” and, together with the First Split Dollar Policy, the “Split Dollar Policies”) will
be assigned to Employee, and the Company agrees to complete all documentation necessary or
desirable to effect such assignment; and
(6) a lump sum in cash equal to the employer contributions the Company would have credited to
Employee’s retirement accounts under The Men’s Wearhouse, Inc. 401(k) Savings Plan and The Men’s
Wearhouse, Inc. Employee Stock Ownership Plan had he continued to remain employed by the Company
until the earlier of February 6, 2016 or the second anniversary of the Termination Date, assuming
for this purpose that (1) Employee’s
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earned compensation for a year is the amount of his annualized Annual Salary for the calendar
year in which the Termination Date occurs, (2) the applicable legal limitations and the employer
contribution percentages under such plans for such period are the same percentages and limitations
in effect immediately prior to the Termination Date and (3) that Employee is deemed to make the
maximum pre-tax elective deferral contributions permitted under section 402(g) of the Internal
Revenue Code of 1986, as amended from time to time (the “Code”); provided, however, that no payment
shall be required with respect to either Plan if on the Termination Date, the Company has ceased
making employer contributions with respect to such Plan or has notified its employees that it
intends to cease making such contributions within six months.
(ii) Subject to clause (iv) of this Section 5(a), until Employee reaches age 65, the Company
shall arrange to provide Employee and his dependents medical insurance benefits substantially
similar to those provided to executive officers of the Company. If Employee is a Specified
Employee (as defined in Section 5(c) below) and the benefits specified in this Section 5(a)(ii) are
taxable to Employee and not otherwise exempt from Section 409A of the Code (“Section 409A”), the
following provisions shall apply to the reimbursement or provision of such benefits. Any amounts
to which Employee would otherwise be entitled under this Section 5(a)(ii) during the first six
months following the date of Employee’s Separation From Service shall be accumulated and paid to
Employee on the date that is six months following the date of his Separation From Service. Except
for any reimbursements under the applicable group health plan that are subject to a limitation on
reimbursements during a specified period, the amount of expenses eligible for reimbursement under
this Section 5(a)(ii), or in-kind benefits provided, during Employee’s taxable year shall not
affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other
taxable year of Employee. Any reimbursement of an expense described in this Section 5(a)(ii) shall
be made on or before the last day of Employee’s taxable year following Employee’s taxable year in
which the expense was incurred. Employee’s right to reimbursement or in-kind benefits pursuant to
this Section 5(a)(ii) shall not be subject to liquidation or exchange for another benefit.
(iii) Subject to Employee’s group health plan coverage continuation rights under the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, the benefits listed in clause
(ii) of this Section 5(a) shall be reduced to the extent benefits of the same type are received by
Employee from any other person during such period, and provided, further, that Employee shall have
the obligation to notify the Company that he is receiving such benefits. The Company agrees that,
if Employee’s employment with the Company terminates during the term of this Agreement, Employee is
not required to seek other employment or to attempt in any way to reduce any amounts payable to
Employee by the Company pursuant to this Section 5. Further, except with respect to the benefits
provided pursuant to clause (ii) above, the amount of any payment or benefit provided for in this
Agreement shall not be reduced by any compensation earned by Employee as the result of employment
by another employer, by retirement benefits, or by offset against any amount claimed to be owed by
Employee to the Company.
(iv) The amounts payable under Section 5(a)(i) shall be paid as follows:
(1) The Company shall pay Employee the amounts specified in Section 5(a)(i)(1) within 15 days
after the Termination Date.
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(2) The Company shall pay Employee the amounts specified in Sections 5(a)(i)(2), 5(a)(i)(3)
and 5(a)(i)(6) on the date that is 30 days following the date of Employee’s Separation From Service
if he is not a Specified Employee or on the date that is six months following the date of his
Separation From Service if he is a Specified Employee.
(3) The Company shall pay Employee the applicable amount specified in Section 5(a)(i)(4) each
Friday beginning with the first Friday immediately following the date of Employee’s Separation From
Service if he is not a Specified Employee or on the date that is six months following the date of
his Separation From Service if he is a Specified Employee. Such first payment shall include all
amounts that would have been paid to Employee earlier under this Section 5(a)(vi)(3) had Employee
not been a Specified Employee.
(4) The Company shall pay Employee the amount specified in Section 5(a)(i)(5) on January 1 of
each year with respect to which such payment is payable, provided, however, that the first such
payment shall not be made before the date that is six months following the date of his Separation
From Service if Employee is a Specified Employee.
(5) If Employee is a Specified Employee at the time of his Separation From Service, the
Company shall pay to Employee, on the date that is six months following Employee’s Separation From
Service, an additional interest amount equal to the amount of interest that would be earned on the
amounts specified in Sections 8(e)(i)(3), 8(e)(i)(6), and on the amounts specified in Sections
8(e)(i)(4) and 8(e)(i)(5) to the extent such payments were delayed solely because he is a Specified
Employee, for the period commencing on the date of Employee’s Separation From Service until the
date of payment of such amounts, calculated using an interest rate equal to the six month London
Interbank Offered Rate in effect on the date of Employee’s Separation From Service plus two
percentage points.
(b) For purposes of this Section 5, “good reason” shall mean the occurrence of any of the
following events:
(i) Removal, without the consent of Employee in writing, from the office of Vice Chairman of
the Board or a material reduction in Employee’s authority or responsibility, except upon a proper
termination of Employee for “cause”, as defined in Section 7 or as a result of voluntary
termination by Employee; or
(ii) The Company otherwise commits a material breach of this Agreement.
(c) For purposes of this Agreement, the terms “Separation From Service” and
“SpecifiedEmployee” shall have the meanings ascribed to such terms in Section 409A.
(d) The C
ompany shall pay any attorney fees incurred by Employee in reasonably seeking to
enforce the terms of this Section 5. Except as provided below, the Company shall pay Employee such
attorney fees within ten (10) business days after the delivery of Employee’s written request for
the payment accompanied by such evidence of legal expenses incurred as the Company may reasonably
require. Notwithstanding the preceding sentence, if Employee incurs a Separation From Service and
is a Specified Employee, the Company shall not make any further payment of attorney fees to
Employee under this Section 5(d) before the date
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that is six months following the date of his Separation From Service. Rather, on the date
that is six months following the date of Employee’s Separation From Service the Company shall pay
to Employee all attorney fees that the Company is required to reimburse under this Section 5(d) for
which a written request for payment was properly submitted by Employee during the first six months
following the date of Employee’s Separation From Service or which were otherwise not paid before
Employee’s Separation From Service. In any event the Company shall pay Employee such legal fees by
the last day of Employee’s taxable year following the taxable year in which Employee incurred such
legal expenses. The legal expenses that are subject to reimbursement pursuant to this Section 5(d)
shall not be limited as a result of when the expenses are incurred. The amounts of legal expenses
that are eligible for reimbursement pursuant to this Section 5(d) during a given taxable year of
Employee shall not affect the amounts of expenses eligible for reimbursement in any other taxable
year of Employee. The right to reimbursement pursuant to this Section 5(d) is not subject to
liquidation or exchange for another benefit.
6. Termination Upon Death or Disability.
(a) If Employee’s employment is terminated because of death, then
(i) Within 30 days after the date of Employee’s death, the Company shall pay to Employee’s
estate a lump sum payment in cash equal to the Accrued Obligation.
(ii) Until the date on which the Employee would have reached age 65, the Company shall arrange
to provide Employee’s dependents medical insurance benefits substantially similar to those provided
to Employee and his dependents immediately prior to the Termination Date (at no greater cost to
Employee’s dependents than such cost to Employee in effect immediately prior to the Termination
Date, or, if greater, the cost to similarly situated active employees of the Company under the
applicable group health plan of the Company). Except for any reimbursements under the applicable
group health plan that are subject to a limitation on reimbursements during a specified period, the
amount of expenses eligible for reimbursement under this Section 6(a)(ii), or in-kind benefits
provided, during Employee’s taxable year shall not affect the expenses eligible for reimbursement,
or in-kind benefits to be provided, in any other taxable year of Employee. Any reimbursement of an
expense described in this Section 6(a)(ii) shall be made on or before the last day of Employee’s
taxable year following Employee’s taxable year in which the expense was incurred. Employee’s right
to reimbursement or in-kind benefits pursuant to this Section 6(a)(ii) shall not be subject to
liquidation or exchange for another benefit.
(iii) Within 30 days after the date of Employee’s death, the Company shall pay to Employee’s
estate a lump sum in cash equal to the employer contributions the Company would have credited to
Employee’s retirement accounts under The Men’s Wearhouse, Inc. 401(k) Savings Plan and The Men’s
Wearhouse, Inc. Employee Stock Ownership Plan had he continued to remain employed by the Company
until the earlier of February 6, 2016 or the second anniversary of the Termination Date, assuming
for this purpose that (1) Employee’s earned compensation for a year is the amount of his annualized
Annual Salary for the calendar year in which the Termination Date occurs, (2) the applicable legal
limitations and the employer contribution percentages under such plans for such period are the same
percentages and limitations in effect immediately prior to the Termination Date and (3) that
Employee is deemed
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to make the maximum pre-tax elective deferral contributions permitted under section 402(g) of
the Code; provided, however, that no payment shall be required with respect to either Plan if on
the date of the Employee’s death, the Company has ceased making employer contributions with respect
to such Plan or has notified its employees that it intends to cease making such contributions
within six months.
(b) If Employee’s employment is terminated on account of his becoming permanently disabled (as
defined in Section 6(b)(v)), then:
(i) The Company shall pay to Employee, at the times specified in Section 6(b)(iv) below, the
following amounts:
(1) a lump sum in cash equal to the Accrued Obligation;
(2) a lump sum in cash equal to Employee’s Annual Salary earned through the Termination Date
for periods following his Separation From Service, to the extent not theretofore paid;
(3) a lump sum in cash equal to the product of (1) the monthly basic life insurance premium
applicable to Employee’s basic life insurance coverage provided through the Company’s life
insurance plan immediately prior to the Termination Date and (2) the number of full months and
fractional months (if any) remaining until the earlier of February 6, 2016 or the second
anniversary of the Termination Date;
(4) cash installment payments each of which is equal to 1/52nd of the Annual
Salary, at the then current rate, that would have been paid if Employee’s employment had continued
and not been terminated under this Section 6(b), for each week during the period beginning on the
Termination Date and ending on the earlier of February 6, 2016 or the second anniversary of the
Termination Date; and
(5) a lump sum in cash equal to the employer contributions the Company would have credited to
Employee’s retirement accounts under The Men’s Wearhouse, Inc. 401(k) Savings Plan and The Men’s
Wearhouse, Inc. Employee Stock Ownership Plan had he continued to remain employed by the Company
until the earlier of February 6, 2016 or the second anniversary of the Termination Date, assuming
for this purpose that (1) Employee’s earned compensation for a year is the amount of his annualized
Annual Salary for the calendar year in which the Termination Date occurs, (2) the applicable legal
limitations and the employer contribution percentages under such plans for such period are the same
percentages and limitations in effect immediately prior to the Termination Date and (3) that
Employee is deemed to make the maximum pre-tax elective deferral contributions permitted under
section 402(g) of the Code: provided, however, that no payment shall be required with respect to
either Plan if on the Termination Date, the Company has ceased making employer contributions with
respect to such Plan or has notified its employees that it intends to cease making such
contributions within six months..
(ii) Until the date on which the Employee reaches age 65, the Company shall arrange to provide
Employee and his dependents medical insurance benefits substantially similar to those provided to
Employee and his dependents immediately prior to the
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Termination Date (at no greater cost to Employee than such cost to Employee in effect
immediately prior to the Termination Date, or, if greater, the cost to similarly situated active
employees of the Company under the applicable group health plan of the Company). Except for any
reimbursements under the applicable group health plan that are subject to a limitation on
reimbursements during a specified period, the amount of expenses eligible for reimbursement under
this Section 6(b)(ii), or in-kind benefits provided, during Employee’s taxable year shall not
affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other
taxable year of Employee. Any reimbursement of an expense described in this Section 6(b)(ii) shall
be made on or before the last day of Employee’s taxable year following Employee’s taxable year in
which the expense was incurred. Employee’s right to reimbursement or in-kind benefits pursuant to
this Section 6(b)(ii) shall not be subject to liquidation or exchange for another benefit.
(iii) Within 30 days after the Termination Date, the Company shall assign its interest in the
Split Dollar Policies to Employee, and the Company agrees to complete all documentation necessary
or desirable to effect such assignment.
(iv) The amounts payable under Section 6(b)(i) shall be paid as follows:
(1) The Company shall pay Employee the amount specified in Section 6(b)(i)(1) within 30 days
the Termination Date.
(2) Subject to Section 6(b)(iv)(4), the Company shall pay Employee the amounts specified in
Sections 6(b)(i)(2), 6(b)(i)(3) and 6(b)(i)(5) 30 days following the date of Employee’s Separation
From Service if he is not a Specified Employee or on the date that is six months following the date
of his Separation From Service if he is a Specified Employee.
(3) Subject to Section 6(b)(iv)(4), the Company shall pay Employee the amount specified in
Section 6(b)(i)(4) each Friday beginning with the first Friday immediately following the date of
Employee’s Separation From Service if he is not a Specified Employee or on the date that is six
months following the date of his Separation From Service if he is a Specified Employee (and such
first payment shall include all amounts that would have been paid to Employee under this Section
6(b)(iv)(3) if Employee had not been a Specified Employee).
(4) In the event of the termination of Employee’s employment pursuant to Section 6(b) in a
circumstance where Employee has incurred a Section 409A Disability, the Company shall pay or begin
to pay, as applicable, Employee the amounts required to be paid pursuant to Sections 6(b)(i)(2),
6(b)(i)(3), 6(b)(i)(4) and 6(b)(i)(5) within 30 days after the date Employee incurs a Section 409A
Disability. For purposes of this Agreement, “Section 409A Disability” means the inability of
Employee to engage in any substantial gainful activity by reason of any medically determinable
physical or mental impairment which can be expected to result in death or can be expected to last
for a continuous period of not less than 12 months. Employee shall also be treated as having a
“Section 409A Disability” if he is, by reason of a medically determinable physical or mental
impairment that can be expected to result in death or
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can be expected to last for a continuous period of not less than 12 months, receiving income
replacement benefits for a period of not less than three months under an accident and health plan
covering employees of the Company.
(v) For purposes of this Agreement, Employee shall be deemed to “permanently disabled” if
Employee shall be considered to be permanently and totally disabled in accordance with the
Company’s disability plan, if any, for a period of 180 days or more. If there should be a dispute
between the Company and Employee as to Employee’s physical or mental disability for purposes of
this Agreement, the question shall be settled by the opinion of an impartial reputable physician or
psychiatrist agreed upon by the parties or their representatives, or if the parties cannot agree
within ten (10) calendar days after a request for designation of such party, then a physician or
psychiatrist shall be designated by the Valley Hospital in Northern New Jersey. The parties agree
to be bound by the final decision of such physician or psychiatrist.
7. Termination by the Company for Cause.
(a) The Company may terminate this Agreement at any time if such termination is for “cause”,
as defined below, by delivering to Employee written notice describing the cause of termination 30
days before the effective date of such termination and by granting Employee 30 days to cure the
cause. In the event that the employment of Employee is terminated for “cause”, Employee shall be
entitled only to (i) the Accrued Obligation, which amount shall be paid within 30 days after the
Termination Date, and (ii) a lump sum payment in cash equal to Employee’s Annual Salary through the
Termination Date for periods following his Separation From Service, to the extent not theretofore
paid, which amount shall be paid to Employee within 30 days following his Separation From Service
if he is not a Specified Employee or on the date that is six months following his Separation From
Service if he is a Specified Employee.
(b) “Cause” shall be limited to the occurrence of the following events:
(i) Conviction of or a plea of nolo contendere to the charge of a felony (which, through lapse
of time or otherwise, is not subject to appeal);
(ii) Willful refusal without proper legal cause to perform, or gross negligence in performing,
Employee’s duties and responsibilities after 30 days written notice and an opportunity to cure;
(iii) Material breach of fiduciary duty to the Company through the misappropriation of Company
funds or property; or
(iv) The unauthorized absence of Employee from work (other than for sick leave or personal
disability) for a period of 60 working days or more during a period of 90 working days.
8. Voluntary Termination by Employee. Employee may terminate this Agreement at any
time upon delivering 30 days written notice to the Company. In the event of such voluntary
termination other than for “good reason” as defined in Section 5, Employee shall be entitled only
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to (a) the Accrued Obligation, which amount shall be paid within 30 days after the Termination
Date, and (b) a lump sum payment in cash equal to Employee’s Annual Salary through the Termination
Date for periods following his Separation From Service, to the extent not theretofore paid, which
amount shall be paid to Employee within 30 days following his Separation From Service if he is not
a Specified Employee, or on the date that is six months following his Separation From Service if he
is a Specified Employee. If Employee terminates this Agreement under this Section 8 at any time
after February 6, 2013 and before February 6, 2016, the Company shall assign its interest in the
Split Dollar Policies to Employee, and the Company agrees to complete all documentation necessary
or desirable to effect such assignment.
9. Exclusivity of Termination Provisions. The termination provisions of this
Agreement regarding the parties’ respective obligations in the event that Employee’s employment is
terminated are intended to be exclusive and in lieu of any other rights or remedies to which
Employee or the Company may otherwise be entitled at law, in equity or otherwise. It is also
agreed that, although the personnel policies and fringe benefit programs of the Company may be
unilaterally modified from time to time, the termination provisions of this Agreement are not
subject to modification, whether orally, impliedly or in writing, unless any such modification is
mutually agreed upon and signed by the parties.
10. Non-Competition. Employee acknowledges that he has and, while employed, will
acquire unique and valuable experience with respect to the businesses, operations, plans and
strategies of the Company and its subsidiaries. Employee hereby covenants and agrees that during
the term of this Agreement and for a period of one year thereafter, he will not directly or
indirectly compete with the business of the Company or its subsidiaries. For purposes of this
Agreement, the term “compete with the business of the Company and its subsidiaries” shall include
Employee’s participation in any operations whose primary business competes with any business now
conducted by the Company or its subsidiaries, including the sale of menswear or shoes at retail,
the sale or rental of occupational uniforms or other corporate wear merchandise or any material
line of business proposed to be conducted by the Company or one or more of its subsidiaries known
to Employee and with respect to which Employee devoted time as part of his employment hereunder on
behalf of the Company or one or more of its subsidiaries, including but not limited to the business
of dry cleaning, whether such participation is individually or as an officer, director, joint
venturer, agent or holder of an interest (except as a holder of a less than 1% interest in a
publicly traded entity or mutual fund) of any individual, corporation, association, partnership,
joint venture or other business entity so engaged. This non-competition covenant shall be
applicable with respect to the United States and Canada and any other country in which Employee
would be competing with the business of the Company or its subsidiaries as set forth in this
Section 10. Notwithstanding the foregoing, the Company acknowledges and agrees that Employee’s
activities described in Schedule 10 hereto shall not constitute a breach of this Section
10. Employee and the Company agree that a monetary remedy for a breach of this Section 10 or of
Section 11 below will be inadequate and will be impracticable and extremely difficult to prove, and
further agree that such a breach would cause the Company irreparable harm, and that the Company
shall be entitled to specific performance and/or temporary and permanent injunctive relief without
the necessity of proving actual damages. Employee agrees that the Company shall be entitled to
such specific performance and/or injunctive relief, including temporary restraining orders,
preliminary injunctions and permanent injunctions, without the necessity of posting bond or other
undertaking in connection therewith. Any such
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requirement of bond or undertaking is hereby waived by Employee and Employee acknowledges that
in the absence of such a waiver, a bond or undertaking may be required by the court. In the event
of litigation to enforce this covenant, the courts are hereby specifically authorized to reform
this covenant as and to the extent, but only to such extent, necessary in order to give full force
and effect hereto to the maximum degree permitted by law. Employee also agrees that if Employee is
in breach of this Section 10, the Company may cease all payments required under this Agreement.
11. Proprietary Information.
(a) Employee acknowledges and agrees that he has acquired, and may in the future acquire as a
result of his employment with the Company or otherwise, Proprietary Information (as defined below)
of the Company, which is of a confidential or trade secret nature, and all of which has a great
value to the Company and is a substantial basis and foundation upon which the Company’s business is
predicated. Accordingly, Employee agrees to regard and preserve as confidential at all times all
Proprietary Information and to refrain from publishing or disclosing any part of it to any person
or entity and from using, copying or duplicating it in any way by any means whatsoever, except in
the course of his employment under this Agreement and in furtherance of the business of the Company
or as required by applicable law or legal process, without the prior written consent of the
Company. In the event of a breach or threatened breach of this Section 11, the Company shall be
entitled to the same remedies as provided in Section 10 with respect to a breach thereof.
(b) “Proprietary Information” includes all information and data in whatever form, tangible or
intangible, pertaining in any manner to pricing policy, marketing programs, advertising, employee
training and specific inventory purchase pricing and any written information, including customer
lists, of the Company or any affiliate thereof, unless the information is or becomes publicly known
through lawful means.
12. Retirement. If this Agreement is not terminated before February 6, 2016, then
thereafter and until Employee reaches age 65, the Company shall (a) arrange to provide Employee and
his dependents medical insurance benefits substantially similar to those provided to executive
officers of the Company and (b) pay to Employee weekly cash installment payments of $1,250. When
Employee reaches age 65, the Company shall, within 30 days, assign its interest in the Split Dollar
Policies to Employee, and the Company agrees to complete all documentation necessary or desirable
to effect such assignment. If Employee is a Specified Employee and the benefits specified in this
Section 12 are taxable to Employee and not otherwise exempt from Section 409A, the following
provisions shall apply to the reimbursement or provision of such benefits. Any amounts to which
Employee would otherwise be entitled under this Section 12 during the first six months following
the date of Employee’s Separation From Service shall be accumulated and paid to Employee on the
date that is six months following the date of his Separation From Service. Except for any
reimbursements under the applicable group health plan that are subject to a limitation on
reimbursements during a specified period, the amount of expenses eligible for reimbursement under
this Section 12, or in-kind benefits provided, during Employee’s taxable year shall not affect the
expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year
of Employee. Any reimbursement of an expense described in this Section 12 shall be made on or
before the last day
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of Employee’s taxable year following Employee’s taxable year in which the expense was
incurred. Employee’s right to reimbursement or in-kind benefits pursuant to this Section 12 shall
not be subject to liquidation or exchange for another benefit.
13. Notice. All notices, requests, consents, directions and other instruments and
communications required or permitted to be given under this Agreement shall be in writing and shall
be deemed to have been duly given if delivered in person, by courier, by overnight delivery service
with proof of delivery or by prepaid registered or certified first-class mail, return receipt
requested, addressed to the respective party at the address set forth below, or if sent by
facsimile or other similar form of communication (with receipt confirmed) to the respective party
at the facsimile number set forth below:
| To the Company: | The Men’s Wearhouse, Inc. 0000 Xxxxxxxxx Xxxx Xxxxxxx, Xxxxx 00000 Attention: Neill X. Xxxxx Facsimile: (000) 000-0000 Confirm: (000) 000-0000 |
||
| To Employee: | Xxxxx X. Xxxxx 0000 Xxxxxxxx, 00xx Xxxxx Xxx Xxxx, XX 00000 Facsimile: (000) 000-0000 Confirm: (000) 000-0000 |
or to such other address or facsimile number and to the attention of such other person as either
party may designate by written notice. All notices and other communication shall be deemed to have
been duly given when delivered personally or three days after mailing or one day after depositing
such notice with an overnight courier or transmission of a facsimile or other similar form of
communication.
14. Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties hereto, their respective heirs, executors, administrators, successors and
assigns; provided, however, that neither the Company nor Employee may assign any duties under this
Agreement without the prior written consent of the other party.
15. Limitation. The Agreement shall not confer any right or impose any obligation on
the Company to continue the employment of Employee in any capacity, or limit the right of the
Company or Employee to terminate Employee’s employment.
16. Further Assurances. Each party hereto agrees to perform such further actions, and
to execute and deliver such additional documents, as may be reasonably necessary to carry out the
provisions of this Agreement.
17. Severability. In the event that any of the provisions, or portions thereof, of
this Agreement are held to be unenforceable or invalid by any court of competent jurisdiction, the
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validity and enforceability or the remaining provisions, or portions thereof, shall not be
affected thereby.
18. Arbitration.
(a) Any dispute, controversy, or claim arising out of or relating to this Agreement, or the
breach, termination or invalidity hereof, including claims for tortious interference or other
tortious or statutory claims arising before, during or after termination, providing only that such
claim touches upon matters covered by this contract, shall be finally settled by arbitration
administered by the American Arbitration Association (“AAA”) pursuant to the Commercial Arbitration
Rules as presently in force, except as modified by the specific provisions of this Agreement. The
parties expressly agree that nothing in this Agreement shall prevent the parties from applying to a
court that would otherwise have jurisdiction over the parties for provisional or interim measures,
including injunctive relief. After the arbitration panel is empaneled, it shall have sole
jurisdiction to hear such applications, except that the parties agree that any measures ordered by
the arbitrators may be immediately and specifically enforced by a court otherwise having
jurisdiction over the parties. The parties agree that judgment on the arbitration award may be
entered by any court having jurisdiction thereof.
(b) The parties agree that the federal and state courts located in Houston, Texas shall have
exclusive jurisdiction over an action brought to enforce the rights and obligations created in or
arising from this Agreement to arbitrate, and each of the parties hereto irrevocably submits to the
jurisdiction of said courts. Notwithstanding the above, application may be made by a party to any
court of competent jurisdiction wherever situated for enforcement of any judgment and the entry of
whatever orders are necessary for such enforcement. Process in any action arising out of or
relating to this Agreement may be served on any party to the Agreement anywhere in the world by
delivery in person against receipt or by registered or certified mail, return receipt requested.
(c) The arbitration shall be conducted before a tribunal composed of three neutral arbitrators
drawn from, in the first instance, the Texas Large Complex Claims panel and then, if necessary,
from the Commercial panel. Each arbitrator shall sign an oath agreeing to be bound by the Code of
Ethics for Arbitrators in Commercial Disputes promulgated by the AAA for Neutral Arbitrators. It
is the intent of the parties to avoid the appearance of impropriety due to bias or partiality on
the part of any arbitrator. Prior to his or her formal appointment, each arbitrator shall disclose
to the parties and to the other members of the tribunal, any financial, fiduciary, kinship or other
relationship between that arbitrator and any party or its counsel, or between that arbitrator and
any individual or entity with any financial, fiduciary, kinship or other relationship with any
party. For the purposes of this Agreement, “appearance of impropriety” shall be defined as such
relationship or behavior as would cause a reasonable person to believe that bias or partiality on
the part of the arbitrator may exist in favor of any party. Any award or portion thereof, whether
preliminary or final, shall be in a written opinion containing findings of fact and conclusions of
law signed by each arbitrator. The arbitrator dissenting from an award or portion thereof shall
issue a dissent from the award or portion thereof in writing, stating the reasons for his or her
dissent. The arbitrators shall hear and determine any preliminary issue of law asserted by a party
to be dispositive of any claim, in whole or part, in the manner of a court
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hearing a motion to dismiss for failure to state a claim or for summary judgment, pursuant to
such terms and procedures as the arbitrators deem appropriate.
(d) It is the intent of the parties that, barring extraordinary circumstances, any arbitration
hearing shall be concluded within two months of the date the statement of claim is received by the
AAA. Unless the parties otherwise agree, once commenced, hearings shall be held 5 days a week,
with each hearing day to begin at 9:00 A.M. and to conclude at 5:00 P.M. The parties may upon
agreement extend these time limits, or the chairman of the panel may extend them if he or she
determines that the interests of justice otherwise require. The arbitrators shall use their best
efforts to issue the final award or awards within a period of 30 days after closure of the
proceedings. Failure to do so shall not be a basis for challenging the award. The parties and
arbitrators shall treat all aspects of the arbitration proceedings, including without limitation,
discovery, testimony and other evidence, briefs and the award, as strictly confidential. The place
of arbitration shall be Houston, Texas, U.S.A. unless otherwise agreed by the parties.
(e) The parties agree that discovery shall be limited and shall be handled expeditiously.
Discovery procedures available in litigation before the courts shall not apply in an arbitration
conducted pursuant to this Agreement. However, each party shall produce relevant and
non-privileged documents or copies thereof requested by the other parties within the time limits
set and to the extent required by order of the arbitrators. All disputes regarding discovery shall
be promptly resolved by the arbitrators. No witness or party may be required to waive any
privilege recognized at law. The parties hereby waive any claim to any damages in the nature of
punitive, exemplary or statutory damages in excess of compensatory damages, or any form of damages
in excess of compensatory damages, and the arbitration tribunal is specially divested of any power
to award any damages in the nature of punitive, exemplary or statutory damages in excess of
compensatory damages, or any form of damages in excess of compensatory damages. Except as provided
in Section 5(d), the party prevailing on substantially all of its claims shall be entitled to
recover its costs, including attorneys’ fees, for the arbitration proceedings, as well as for any
ancillary proceeding, including a proceeding to compel arbitration, to request interim measures or
to confirm or set aside an award.
19. Governing Law. This Agreement shall be governed and construed under and
interpreted in accordance with the laws of the State of Texas without giving effect to the doctrine
of conflict of laws.
20. Entire Agreement; Waiver; Interpretation. This Agreement constitutes the entire
agreement of the parties, and supersede all prior agreements, oral or written, with respect to the
subject matter of this Agreement; provided, that the Change in Control Agreement and any Award
Agreement shall not be superseded hereby. No change, modification or waiver of any provisions of
this Agreement shall be enforceable unless contained in a writing signed by the party against whom
enforcement is sought. The failure at any time to enforce any of the provisions of this Agreement
shall in no way be construed as a waiver of such provisions and shall not affect the right of
either party thereafter to enforce each and every provision hereof in accordance with its terms.
No presumption shall be construed against the party drafting this Agreement.
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21. Employee’s Representation. Employee represents and warrants that (i) he is free
to enter into this Agreement and to perform each of the terms and covenants of it, (ii) he is not
restricted or prohibited, contractually or otherwise, from entering into and performing this
Agreement, (iii) his execution and performance of this Agreement is not a violation or breach of
any other agreement between Employee and any other person or entity and (iv) he has been advised by
legal counsel as to the terms and provisions hereof and the effort thereof and fully understands
the consequences thereof.
22. Company’s Representation. The Company represents and warrants that (i) it is free
to enter into this Agreement and to perform each of the terms and covenants of it, (ii) it is not
restricted or prohibited, contractually or otherwise, from entering into and performing this
Agreement, (iii) its execution and performance of this Agreement is not a violation or breach of
any other agreement between Employee and any other person or entity and (iv) this Agreement is a
legal, valid and binding agreement of the Company, enforceable in accordance with its terms.
23. Return of Company Property. Employee acknowledges that all Proprietary
Information and other property and equipment of the Company or any affiliate that Employee
accumulates during his employment are the property of the Company and shall be returned to the
Company immediately upon the termination of his employment.
24. Miscellaneous. All references to sections of any statute shall be deemed also to
refer to any successor provisions to such sections. The compensation and benefits payable to
Employee or his beneficiary under Section 5 of this Agreement shall be in lieu of any other
severance benefits to which Employee may otherwise be entitled upon the termination of his
employment under any severance plan, program, policy or arrangement of the Company other than the
Change in Control Agreement, and Employee shall not be entitled to receive any benefits under
Section 5 hereof if he has become eligible to receive benefits under the Change in Control
Agreement. The amount of any payment or benefit provided for in this Agreement shall not be
reduced by offset against any amount claimed to be owed by Employee to the Company. Employee shall
not be permitted to specify the taxable year in which a payment provided for under this Agreement
shall be made to him.
25. Compliance With Section 409A. It is intended that this Agreement shall comply
with Section 409A. The provisions of this Agreement shall be interpreted and administered in a
manner that complies with Section 409A. The provisions of this Agreement dealing with Section 409A
reflect the manner in which this Agreement has been operated in good faith compliance with Section
409A since January 1, 2005.
[Remainder of Page Intentionally Left Blank; Signatures on Following Page.]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed effective as of
October 25, 2010.
| THE MEN’S WEARHOUSE, INC. |
||||
| By: | /s/ NEILL X. XXXXX | |||
| Name: | Neill X. Xxxxx | |||
| Title: | EVP & CFO |
|||
| Date: 11/5/10 | ||||
| /s/ XXXXX X. XXXXX | ||||
| XXXXX X. XXXXX | ||||
Date: 10/25/10 |
||||
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Schedule 10
Activities Excluded from Section 10
Activities Excluded from Section 10
Employee being a board member of, and a member of any committee of the board of, or holding,
directly or indirectly, less than a 5% equity interest in, any of the following business entities
shall not be prohibited by Section 10.
| 1. | New York & Company | ||
| 2. | Affliction, LLC | ||
| 3. | Ring Fashion International LLC |
In addition, advising Irving Place Capital Partners (previously Bear Xxxxxxx Merchant Banking)
or any successor thereof with respect to investment opportunities shall not be prohibited by
Section 10.
