EXHIBIT 10.5
EXHIBIT 10.5 TO XXXX STORES, INC. THIRD QUARTER 2000 FORM 10-Q
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT is made effective as of
_____________________, by and between Xxxx Stores, Inc. (the "Company"), a
Delaware corporation, and ___________________________ (the "Executive").
RECITALS
A. It is now the mutual desire of the Company and the Executive to
enter into a written employment agreement to govern the terms of the Executive's
employment by the Company as of the start of the term of this Agreement on the
terms and conditions set forth below.
TERMS AND CONDITIONS
In consideration for the promises of the parties set forth below, the
Company and the Executive hereby agree as follows:
1. TERM. Subject to the provisions of Section 6 of this Agreement,
the term of employment of the Executive under this Agreement shall be as
follows.
(a) INITIAL TERM. The initial term of the employment of the
Executive by the Company under this Agreement shall begin on the date hereof and
end on , unless extended or terminated earlier in accordance
with this Agreement.
(b) RENEWAL TERMS. Upon the written request of the Executive to
extend the Executive's term of employment under this Agreement prior to the
termination of the Executive's employment with the Company, the Board of
Directors of the Company ("Board") shall consider extending the Executive's
employment with the Company under this Agreement. Such request must be delivered
to the Chairman of the Compensation Committee of the Board not later than twelve
(12) months prior to the end of the initial or renewal term of employment.
Within thirty (30) days following the receipt of such notice, the Board shall
consider the Executive's request and advise the Executive, in writing, within
thirty (30) days following its consideration of the Executive's written request,
whether it approves of such extension. The failure of the Board to provide such
written advice shall constitute approval of the Executive's request for
extension. If the Executive's request for an extension is approved, this
Agreement shall be extended two (2) additional years. Such additional two-year
period is referred to herein as a "Renewal Term."
2. POSITION AND DUTIES. During the term of the Executive's employment
under this Agreement, the Executive shall serve as the Senior Vice President,
____________________ of the Company with overall responsibility for the
___________________ function of the Company. The Executive shall report directly
to the Chief Executive Officer, Chief Operating Officer or Executive Vice
President, Merchandising of the Company. During the term of the
Executive's employment, the Executive may engage in outside activities provided
those activities do not conflict with the Executive's duties and
responsibilities hereunder, and provided further that the Executive gives
written notice to the Board of any significant outside business activity in
which Executive plans to become involved, whether or not such activity is
pursued for profit.
3. PRINCIPAL PLACE OF EMPLOYMENT. The Executive shall be employed at
the Company's offices in _____________________, except for required travel on
the Company's business to an extent substantially consistent with present
business travel obligations of the Executive's position.
4. COMPENSATION AND RELATED MATTERS.
(a) SALARY. During the Executive's employment, the Company shall
pay the Executive a salary of not less than __________________ Dollars
($___________) per year. The Executive's salary, shall be payable in equal
installments in accordance with the Company's normal payroll practices
applicable to senior officers. Subject to the first sentence of this Section
4(a), the Executive's salary may be adjusted from time to time by the Board in
accordance with normal business practices of the Company.
(b) BONUS. During the Executive's employment, the Company shall
pay the Executive an annual bonus in accordance with the terms of the existing
bonus incentive plan that covers the Executive (which is currently the Incentive
Compensation Plan) or any replacement plan of substantially equivalent or
greater value that may subsequently be established and in effect during the term
of Executive's employment with the Company.
(c) EXPENSES. During the Executive's employment, the Executive
shall be entitled to receive prompt reimbursement for all reasonable expenses
incurred by Executive in performing services hereunder, including all reasonable
expenses of travel and living while away from home, provided that such expenses
are incurred and accounted for in accordance with the policies and procedures
established by the Company.
(d) BENEFITS. The Executive shall be entitled to participate in
all of the Company's employee benefit plans and arrangements in effect on the
date hereof in which senior executives of the Company are eligible to
participate (including without limitation each pension and retirement plan and
arrangement, supplemental pension and retirement plan, deferred compensation
plan, short-term and long-term incentive plan, stock option plan (but not
including the Company's Outside Directors Option Plan or 2000 Equity Incentive
Plan), life insurance and health-and-accident plan and arrangement, medical
insurance plan, physical examination program, dental care plan, accidental death
and disability plan, survivor income plan, relocation plan, financial, tax and
legal counseling programs, and vacation plan). The Company shall not make any
changes in such plans or arrangements which would adversely affect the
Executive's rights or benefits thereunder, unless such change occurs pursuant to
a program applicable to all senior executives of the Company and does not result
in a proportionately greater reduction in the benefits of the Executive as
compared with any other senior executive of the Company. The Executive shall be
entitled to participate in, or receive benefits under, any employee benefit plan
arrangement made available by the Company in the future to its executives and
key management
employees, subject to, and on a basis consistent with, the terms, conditions and
overall administration of such plans and arrangements. Except as otherwise
specifically provided herein, nothing paid to the Executive under any plan or
arrangement presently in effect or made available in the future shall be in lieu
of the salary or bonus otherwise payable under this Agreement.
(e) VACATIONS. The Executive shall be entitled to the number of
vacation days in each calendar year, and to compensation in respect of earned
but unused vacation days, determined in accordance with the Company's vacation
plan. The Executive shall also be entitled to all paid holidays given by the
Company to its executives. Unused vacation days shall not be forfeited once they
have been earned and, if still unused at the time of the Executive's termination
of employment with the Company, shall be promptly paid to the Executive at their
then-current value, based on the Executive's rate of pay at the time of the
Executive's termination of employment.
(f) SERVICES FURNISHED. The Company shall furnish the Executive
with office space and such services as are suitable to the Executive's position
and adequate for the performance of the Executive's duties during the term of
this Agreement.
5. CONFIDENTIAL INFORMATION
(a) The Executive agrees not to disclose, either while in the
Company's employ or at any time thereafter, to any person not employed by the
Company, or not engaged to render services to the Company, any confidential
information obtained while in the employ of the Company, including, without
limitation, any of the Company's inventions, processes, methods of distribution
or customers or trade secrets; provided, however, that the Executive's provision
shall not preclude the Executive from use or disclosure of information known
generally to the public or from disclosure required by law or court order.
(b) The Executive agrees that upon leaving the Company's employ
Executive will make himself or herself reasonably available to answer questions
from Company officers regarding the Executive's former duties and
responsibilities and the knowledge Executive obtained in connection therewith.
In addition, Executive will not take with Executive, without the prior written
consent of any officer authorized to act in the matter by the Board, any study,
memoranda, drawing, blueprint, specification or other document of the Company,
its subsidiaries, affiliates and divisions, which is of a confidential nature
relating to the Company, its subsidiaries, affiliates and divisions.
6. TERMINATION. The Executive's employment may be terminated during
the term of this Agreement only as follows:
(a) DEATH. The Executive's employment shall terminate upon the
Executive's death.
(b) DISABILITY. If, as a result of the Executive's Disability (as
defined below), the Executive shall have been absent from the Executive's duties
hereunder on a full-time basis for the entire period of six consecutive months,
and within thirty days after written notice of termination is given by the
Company or the Executive (which may occur before or after the end
of such six-month period), the Executive shall not have returned to the
performance of the Executive's duties hereunder on a full-time basis, the
Executive's employment shall terminate. A termination of employment pursuant to
this Section 6(b) shall be deemed an involuntary termination for purposes of
this Agreement or any plan or practice of the Company. For purposes of this
Agreement, the term "Disability" shall mean a physical or mental illness,
impairment or condition reasonably determined by the Board that prevents the
Executive from performing the duties of the Executive's position under this
Agreement.
(c) CAUSE. The Company may terminate the Executive's employment
for Cause. The Company shall have "Cause" to terminate the Executive's
employment if the Executive either (i) continuously fails to substantially
perform the Executive's duties hereunder (unless such failure is a result of a
disability as defined in Section (b)) or (ii) intentionally engages in illegal
or grossly negligent conduct which is materially injurious to the Company
monetarily or otherwise. A termination for Cause shall not take effect unless:
(1) the Executive is given written notice by the Company of its intention to
terminate Executive for Cause; (2) the notice specifically identifies the
particular act or acts or failure or failures to act which are the basis for
such termination; (3) the notice is given within 90 days of the Company's
learning of such act or acts or failure or failures to act; and (4) the
Executive fails to substantially cure such conduct, to the extent such cure is
possible, within 60 days after the date that such written notice is given to the
Executive.
(d) WITHOUT CAUSE. The Company may terminate the Executive's
employment at any time Without Cause. A termination "Without Cause" is a
termination of the Executive's employment by the Company for any reasons other
than the death or disability of the Executive or the involuntary termination of
Executive for Cause as described above in Section 6(c).
(e) TERMINATION BY THE EXECUTIVE FOR GOOD REASON. The Executive
may terminate the Executive's employment with the Company for Good Reason, which
shall be deemed to occur if Executive terminates the Executive's employment
within six months after (1) written notice of a failure by the Company to comply
with any material provision of this Agreement (including but not limited to the
reduction of the Executive's salary or target bonus opportunity) which failure
has not been cured within ten days after such written notice of noncompliance
has been given by the Executive to the Company, or (2) a significant
diminishment in the nature or scope of the authority, power, function or duty
attached to the position which the Executive currently maintains without the
express written consent of the Executive, or (3) the Executive is relocated more
than 25 miles from the Executive's Principal Place of Employment as described in
Section 3 without the Executive's prior written consent.
(f) VOLUNTARY TERMINATION. The Executive may voluntarily
terminate the Executive's employment with the Company at any time. A voluntary
termination of employment by the Executive pursuant to Section 6(e) above for
Good Reason shall not be deemed a voluntary termination by the Executive for
purposes of this Agreement or any plan or practice of the Company but shall be
deemed an involuntary termination.
(g) NON-RENEWAL. If the Executive fails to request an extension
of the term of the Executive's employment in accordance with Section 1 or if the
Board fails to approve such
request, this Agreement shall automatically expire at the end of the then
current term. Such expiration shall not entitle the Executive to any
compensation or benefits except as earned by the Executive through the date of
expiration of the then current term of the employment and as set forth in
Section 8(e) [Special Change of Control Provisions]. The parties hereto shall
have no further obligations to each other thereafter except as set forth in
Sections 5 and 12.
7. NOTICE AND EFFECTIVE DATE OF TERMINATION
(a) NOTICE. Any termination of the Executive's employment by the
Company or by the Executive during the term of this Agreement (other than as a
result of death) shall be communicated by written notice of termination to the
other party hereto. Such notice shall indicate the specific termination
provision in this Agreement relied upon and shall set forth in reasonable detail
the facts and circumstances claimed to provide a basis for termination of the
Executive's employment under that provision.
(b) DATE OF TERMINATION. The date of termination shall be:
(i) if the Executive's employment is terminated by the
Executive's death, the date of the Executive's death;
(ii) if the Executive's employment is terminated due to
disability pursuant to Section 6(b), the date of termination shall be the 31st
day following delivery of the notice of termination;
(iii) if the Executive's employment is terminated for any
other reason by either party, the date on which a notice of termination is
delivered to the other party; and
(iv) if the Agreement expires pursuant to Section
6(g)[Non-Renewal], the parties' employment relationship shall terminate on the
last day of the term of Executive's employment under this Agreement without any
notice.
8. COMPENSATION AND BENEFITS UPON TERMINATION.
(a) TERMINATION DUE TO DISABILITY, WITHOUT CAUSE OR FOR GOOD
REASON. If the Executive's employment terminates pursuant to Sections
6(b)[Disability], (d)[Without Cause], or (e)[For Good Reason], the Executive
shall be entitled to the following:
(i) SALARY. The Company shall continue to pay the
Executive the Executive's then-current salary through the remaining term of the
Executive's employment under this Agreement as defined in Section 1.
(ii) BONUS. The Company shall continue to pay the Executive
an annual bonus(es) throughout such remaining term. Each such bonus shall be
equal to the greater of (A) the Executive's bonus during the year prior to the
Executive's termination or (B) the bonus that the Executive would have earned
under the Company's bonus plan in the year that Executive was terminated had
Executive remained in its employment; provided, however, that such
post-termination bonuses shall not exceed the lesser of 100% of the targeted
amounts for
those bonuses in the prior year and 100% of such targeted amounts
for the then-current year. Such bonuses shall not be paid until due under the
Company's present bonus plan.
(iii) STOCK OPTIONS. With respect to any stock options
granted to the Executive by the Company, the Executive shall immediately become
vested in any unvested stock options upon such termination.
(iv) RESTRICTED STOCK. With respect to any restricted stock
granted to the Executive by the Company which has not become vested as of such
termination, the Executive shall immediately become vested in a pro rata portion
of such unvested stock in accordance with the terms of the applicable stock
grant agreements.
The Company shall have no further obligations to the Executive as a
result of such termination except as set forth in Section 12.
(b) FOR CAUSE. If the Executive's employment is terminated for
Cause (as defined in Section 6(c), Executive shall receive only the
post-termination compensation and benefits described in Section 8(c) [Death or
Voluntary Termination].
(c) DEATH OR VOLUNTARY TERMINATION. If the Executive's employment
terminates pursuant to Section 6(a) [Death] or 6(f)[Voluntary Termination],
Executive (or the Executive's designee or the Executive's estate) shall be paid
the Executive's salary through the Executive's termination date and not
thereafter. Executive shall not be entitled to any bonus payments which were not
fully earned prior to the Executive's termination date, and Executive shall not
be entitled to any pro-rated bonus payment for the year in which the Executive's
employment terminates. Any stock options granted to the Executive by the Company
shall continue to vest only through the date on which the Executive's employment
terminates and any restricted stock that was granted to the Executive by the
Company that is unvested as of the date on which the Executive's employment
terminates shall automatically be reacquired by the Company and the Executive
shall have no further rights with respect to such restricted stock. The Company
shall have no further obligations to the Executive as a result of the
termination of the Executive's employment pursuant to Section 6(a) or (f).
(d) NON-RENEWAL. If the Agreement expires as set forth in Section
6(g)[Non-Renewal], the Executive shall be entitled only to the following:
(i) SALARY. The Company shall continue to pay the
Executive the Executive's then-current salary through the remaining term of the
Executive's employment under this Agreement as defined in Section 1.
(ii) BONUS. The Company shall continue to pay the Executive
an annual bonus for the year of termination which shall be pro-rated for the
portion of the bonus year that Executive is employed by the Company. The
calculation of such bonus prior to pro-ration shall be equal to the greater of
(A) the Executive's bonus during the year prior to the Executive's termination
or (B) the bonus that the Executive would have earned under the Company's bonus
plan in the year that Executive was terminated had Executive remained in its
employment; provided, however, that such post-termination bonuses shall not
exceed the lesser of 100% of the targeted amounts for those bonuses in the prior
year and 100% of such targeted
amounts for the then-current year. Such bonuses shall not be paid until due
under the Company's present bonus plan.
(iii) STOCK OPTIONS. With respect to any stock options
granted to the Executive by the Company, the Executive shall be vested in the
stock options only through the date on which the Executive's employment
terminates according to the original terms of the stock option agreements and
the respective plan.
(iv) RESTRICTED STOCK. Any restricted stock that was
granted to the Executive by the Company that is unvested as of the date on which
the Executive's employment terminates due to a nonrenewal shall automatically
become vested in a pro-rata portion of such restricted stock determined on the
basis of the number of full months that have elapsed from the date of grant of
such restricted stock until the termination date divided by the total number of
months required for the restricted stock to become vested if not for the
termination or this provision. Thereafter, the unvested portion of the
restricted stock shall automatically be reacquired by the Company and the
Executive shall have no further rights in such unvested portion of the
restricted stock.
The Company shall have no further obligations to the Executive as a
result of such termination except as set forth in Section 12.
(e) SPECIAL CHANGE OF CONTROL PROVISIONS.
(i) CHANGE OF CONTROL BENEFITS.
(1) In the event of a Change of Control (as defined
below), Executive shall be entitled to receive the immediate acceleration of the
vesting of any restricted stock that was granted to the Executive by the Company
and an additional salary equal to _____________________________Dollars
($__________) per month for a period of two (2) years following the Change of
Control unless and until Executive's employment is Voluntarily Terminated (as
defined in Section 6(f)) or is terminated for Cause (as defined in Section
6(c)).
(2) Notwithstanding the foregoing, if the Executive's
employment is terminated either by the Company Without Cause (as defined in
Section 6(d) or by the Executive for Good Reason as defined in Section 6(e))
within one month prior and twelve (12) months following a Change of Control, the
Executive shall be entitled to the following (in addition to any other payments
or benefits provided under this Agreement):
a. SALARY. The salary that shall be payable to
Executive under Section 8(a) shall be for a period of not less than two (2)
years.
b. BONUS. The bonus that shall be payable to
Executive under Section 8(a) shall be for a period of not less than two (2)
years.
(3) HEALTH CARE COVERAGE. In the event of the
termination of Executive's employment following a Change of Control, then
Executive shall be entitled to the continuation of the Executive's health care
coverage under the Company's employee benefit plans (including medical, dental,
vision and mental coverage) which the Executive had at the
time of the termination (including coverage for the Executive's dependents) at
the Company's expense for a period of two (2) years. Such health care
continuation rights will be in addition to any rights the Executive may have
under ERISA Sections 600 and thereafter and Section 4980B of the Internal
Revenue Code ("COBRA coverage").
(4) ESTATE PLANNING. In the event of the termination
of Executive's employment following a Change of Control, then Executive shall
also be entitled to the reimbursement of the Executive's estate planning
expenses (including attorneys' fees) as to which and on the terms of which
Executive was entitled prior to the termination for a period of two (2) years
following the date of termination of employment.
(ii) CHANGE OF CONTROL DEFINED. A "Change in Control" shall
be deemed to have occurred if: (1) any person or group (within the meaning of
Rule 13d-3 of the rules and regulations promulgated under the Securities
Exchange Act of 1934, as amended) shall acquire, in one or a series of
transactions, whether through sale of stock or merger, ownership of stock of the
Company that possesses more than 30 percent of the total fair market value or
total voting power of the stock of the Company or any successor to the Company;
(2) a merger in which the Company is a party after which merger the stockholders
of the Company do not retain, directly or indirectly, at least a majority of the
beneficial interest in the voting stock of the surviving company, or (3) the
sale, exchange, or transfer of all or substantially all of the Company's assets
(other than a sale, exchange, or transfer to one or more corporations where the
stockholders of the Company before and after such sale, exchange, or transfer,
directly or indirectly, are the beneficial owners of at least a majority of the
voting stock of the corporation(s) to which the assets were transferred).
(iii) EXCISE TAX GROSS-UP. If the Executive becomes entitled
to one or more payments (with a "payment" including the vesting of restricted
stock, a stock option, or other non-cash benefit or property), whether pursuant
to the terms of this Agreement or any other plan or agreement with the Company
or any affiliated company (collectively, "Change of Control Payments"), which
are or become subject to the tax ("Excise Tax") imposed by Section 4999 of the
Internal Revenue Code of 1986, as amended (the "Code"), the Company shall pay to
the Executive at the time specified below such amount (the "Gross-up Payment")
as may be necessary to place the Executive in the same after-tax position as if
no portion of the Change of Control Payments and any amounts paid to the
Executive pursuant to Section 8 had been subject to the Excise Tax. The Gross-up
Payment shall include, without limitation, reimbursement for any penalties and
interest that may accrue in respect of such Excise Tax. For purposes of
determining the amount of the Gross-up Payment, the Executive shall be deemed:
(A) to pay federal income taxes at the highest marginal rate of federal income
taxation for the calendar year in which the Gross-up Payment is to be made; and
(B) to pay any applicable state and local income taxes at the highest marginal
rate of taxation for the calendar year in which the Gross-up Payment is to be
made, net of the maximum reduction in federal income taxes which could be
obtained from deduction of such state and local taxes if paid in such year. If
the Excise Tax is subsequently determined to be less than the amount taken into
account hereunder at the time the Gross-up Payment is made, the Executive shall
repay to the Company at the time that the amount such reduction in Excise Tax is
finally determined (but, if previously paid to the taxing authorities, not prior
to the time the amount of such reduction is refunded to the Executive or
otherwise realized as a benefit by the Executive) the portion of the Gross-up
Payment that would
not have been paid if such Excise Tax had been used in initially calculating
the Gross-up payment, plus interest on the amount of such repayment at the
rate provided in Section 1274(b)(2)(B) of the Code. In the event that the
Excise Tax is determined to exceed the amount taken into account hereunder at
the time the Gross-up Payment is made, the Company shall make an additional
Gross-up Payment in respect of such excess (plus any interest and penalties
payable with respect to such excess) at the time that the amount of such
excess is finally determined.
(iv) The Gross-up Payment provided for above shall be paid
on the 30th day (or such earlier date as the Excise Tax becomes due and payable
to the taxing authorities) after it has been determined that the Change of
Control Payments (or any portion thereof) are subject to the Excise Tax;
provided, however, that if the amount of such Gross-up Payment or portion
thereof cannot be finally determined on or before such day, the Company shall
pay to the Executive on such day an estimate, as determined by counsel or
auditors selected by the Company and reasonably acceptable to the Executive, of
the minimum amount of such payments. The Company shall pay to the Executive the
remainder of such payments (together with interest at the rate provided in
Section 1274(b)(2)(B) of the Code) as soon as the amount thereof can be
determined. In the event that the amount of the estimated payments exceeds the
amount subsequently determined to have been due, such excess shall constitute a
loan by the Company to the Executive, payable on the fifth day after demand by
the Company (together with interest at the rate provided in Section
1274(b)(2)(B) of the Code). The Company shall have the right to control all
proceedings with the Internal Revenue Service that may arise in connection with
the determination and assessment of any Excise Tax and, at its sole option, the
Company may pursue or forego any and all administrative appeals, proceedings,
hearings, and conferences with any taxing authority in respect of such Excise
Tax (including any interest or penalties thereon); provided, however, that the
Company's control over any such proceedings shall be limited to issues with
respect to which a Gross-up Payment would be payable hereunder, and the
Executive shall be entitled to settle or contest any other issue raised by the
Internal Revenue Service or any other taxing authority. The Executive shall
cooperate with the Company in any proceedings relating to the determination and
assessment of any Excise Tax and shall not take any position or action that
would materially increase the amount of any Gross-up Payment hereunder.
9. EMPLOYMENT RESTRICTION.
(a) NON-COMPETE. The Company and the Executive acknowledge that
the Company has a special interest in and derives significant benefit from the
unique skills and experience of the Executive. In addition, the Executive will
use and have access to some of the Company's proprietary and valuable
Confidential Information during the course of the Executive's employment.
Accordingly, except as hereafter noted, during the term of the Executive's
employment with the Company for a period of 36 months following the Executive's
termination of employment with the Company, Executive shall not provide any
labor, work, services or assistance to (whether as an officer, director,
employee, partner, agent, owner, independent contractor, stockholder or
otherwise) any off-price retailers and to Burlington Coat Factory Warehouse
Corporation, Xxxxxxx Department Stores, Inc., Filene's Basement Corp., The
Federated Stores, The May Department Stores Company, The TJX Companies, Inc. and
Value City Department Stores, Inc., as well as all subsidiaries, divisions
and/or the surviving entity of any of the above that do business in the retail
industry in the case of a merger or acquisition.
However, this Section 9(a) shall not prohibit the Executive from making any
investment of 1% or less of the equity securities of any publicly-traded
corporation or limited partnership that is engaged in any business of the type
or character engaged in by the Company.
The foregoing restrictions shall have no force or effect in the event that: (i)
the Executive's employment with the Company is terminated either by the Company
pursuant to Section 6(d)[Without Cause] or by the Executive pursuant or Sections
6(e) [Termination by the Executive for Good Reason]; or (ii) the Company fails
to approve or grant an extension of this Agreement in accordance with Section 1
hereof.
(b) NON-SOLICITATION OF EMPLOYEES. During the term of the
Executive's employment with the Company and for a period of 36 months following
the termination of that employment for any reason, the Executive shall not
directly or indirectly solicit any other employee of the Company to terminate
his or her employment with the Company.
10. EXERCISE OF STOCK OPTIONS FOLLOWING TERMINATION. If the
Executive's employment terminates, Executive (or the Executive's estate) may
exercise the Executive's right to purchase any vested stock under the stock
options granted to Executive by the Company as provided in the applicable stock
option agreements. All such purchases must be made by the Executive in
accordance with the applicable stock option plans and agreements between the
parties.
11. SUCCESSORS; BINDING AGREEMENT. This Agreement and all rights of
the Executive hereunder shall inure to the benefit of and be enforceable by the
Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If the Executive should
die while any amounts would still be payable to Executive hereunder, all such
amounts shall be paid in accordance with the terms of this Agreement to the
Executive's written designee or, if there be no such designee, to the
Executive's estate.
12. INSURANCE AND INDEMNITY. The Company shall, to the extent
permitted by law, include the Executive during the term of the Executive's
agreement under any directors and officers liability insurance policy maintained
for its directors and officers, with coverage at least as favorable to the
Executive in amount and each other material respect as the coverage of other
directors and officers covered thereby. The Executive's obligation to provide
insurance and indemnify the Executive shall survive expiration or termination of
this Agreement with respect to proceedings or threatened proceedings based on
acts or omissions of the Executive occurring during the Executive's employment
with the Company or with any affiliated company. Such obligations shall be
binding upon the Company's successors and assigns and shall inure to the benefit
of the Executive's heirs and personal representatives.
13. NOTICE. For the purposes of this Agreement, notices, demands and
all other communications provided for in the Agreement shall be in writing and
shall be deemed to have been duly given when delivered or (unless otherwise
specified) mailed by United States registered mail, return receipt requested,
postage prepaid, addressed as follows:
If to the Executive:
--------------------
--------------------
--------------------
If to the Company: Xxxx Stores, Inc.
0000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: President and COO
or to such other address as any party may have furnished to the other in writing
in accordance herewith, except that notices of change of address shall be
effective only upon receipt.
14. COMPLETE AGREEMENT; MODIFICATION OR WAIVER; ENTIRE AGREEMENT. The
Executive's document represents the complete agreement of the parties with
respect to the subject matter hereof and supersedes all prior and
contemporaneous agreements, promises or representations of the parties. No
provision of this Agreement may be modified or waived except in a document
signed by the Executive and the chairman of the Compensation Committee of the
Board or such other person as may be designated by the Board. This Agreement,
along with any stock option or restricted stock agreements between the parties,
constitute the entire agreement between the parties regarding their employment
relationship. To the extent that this Agreement is in any way inconsistent with
any prior or contemporaneous restricted stock or stock option agreements between
the parties, this Agreement shall control. No agreements or representations,
oral or otherwise, with respect to the subject matter hereof have been made by
either party which are not set forth expressly in this Agreement.
15. GOVERNING LAW - SEVERABILITY. The validity, interpretation,
construction, performance, and enforcement of this Agreement shall be governed
by the laws of the state in which Executive's principle place of employment is
located without reference to that state's choice of law rules. The invalidity or
unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement.
16. MITIGATION NOT REQUIRED. In the event the Executive's employment
with the Company terminates for any reason, the Executive shall not be obligated
to seek other employment following such termination. Any amounts due the
Executive under this Agreement shall be offset by any remuneration attributable
to any subsequent employment that Executive may obtain during the period of
payment of compensation under this Agreement following the termination of
Executive's employment with the Company.
17. WITHHOLDING. All payments required to be made by the Company
hereunder to the Executive or the Executive's estate or beneficiaries shall be
subject to the withholding of such amounts as the Company may reasonably
determine it should withhold pursuant to any applicable law. To the extent
permitted, the Executive may provide all or any part of any necessary
withholding by contributing Company stock with value, determined on the date
such withholding is due, equal to the number of shares contributed multiplied by
the closing NASDAQ price on the date preceding the date the withholding is
determined.
18. ARBITRATION. In the event of any dispute or claim relating to
or arising out of the parties' employment relationship or this Agreement
(including, but not limited to, any claims of breach of contract, wrongful
termination, or age, race, sex, disability or other discrimination), all such
disputes shall be fully, finally and exclusively resolved by binding
arbitration conducted by the American Arbitration Association in the city in
which Executive's principle place of employment is located by an arbitrator
mutually agreed upon by the parties hereto or, in the absence of such
agreement, by an arbitrator selected in accordance with the Commercial
Arbitration Rules of the American Arbitration Association, provided, however,
that the Executive's arbitration provision shall not apply to any disputes or
claims relating to or arising out of the misuse or misappropriation of the
Company's trade secrets or proprietary information. Notwithstanding the
foregoing, if either the Company or the Executive shall request, such
arbitration shall be conducted by a panel of three arbitrators, one selected
by the Company, one selected by the Executive, and the third selected by
agreement of the first two, or, in the absence of such agreement, in
accordance with such Rules.
If there is termination of your employment with the Company followed by
a dispute as to whether you are entitled to the benefits provided under this
Agreement, then, during the period of that dispute the Company shall pay you
fifty percent (50%) of the amount specified in Section 8 hereof (except that the
Company shall pay one hundred percent (100%) of any insurance premiums provided
for in Section 8), if, and only if, you agree in writing that if the dispute is
resolved against you, you shall promptly refund to the Company all payments you
receive. If the dispute is resolved in your favor, promptly after resolution of
the dispute the Company shall pay you the sum that was withheld during the
period of the dispute plus interest at the rate provided in Section 1274(d) of
the Code, compounded quarterly.
19. ATTORNEY'S FEES. Each party shall bear its own attorney's fees and
costs incurred in any action or dispute arising out of this Agreement.
20. MISCELLANEOUS. No right or interest to, or in, any payments shall
be assignable by the Executive; provided, however, that the Executive's
provision shall not preclude Executive from designating in writing one or more
beneficiaries to receive any amount that may be payable after Executive's death
and shall not preclude the legal representative of Executive's estate from
assigning any right hereunder to the person or persons entitled thereto. This
Agreement shall be binding upon and shall inure to the benefit of the Executive,
the Executive's heirs and legal representatives and, the Company and its
successors.
IN WITNESS WHEREOF, the parties have executed this Executive Employment
Agreement effective as of the date and year first above written.
XXXX STORES, INC. EXECUTIVE
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By: Xxxxxxx Xxxxxxx
