EXHIBIT 10.43
EMPLOYMENT AGREEMENT
BETWEEN
VALUE CITY DEPARTMENT STORES, INC.
AND
XXXXXX X. XXXXXX
This employment agreement ("Agreement") by and between Value City Department
Stores, Inc. ("Company") and Xxxxxx X. Xxxxxx ("Executive"), collectively, the
"Parties," is effective as of the date signed ("Effective Date") and supercedes
and replaces any other oral or written employment-related agreement between the
Executive and the Company.
1.00 DURATION
This Agreement will remain in effect from the Effective Date until it terminates
as provided in Section 5.00. Any notice of termination required to be given
under this Agreement must be given as provided in Section 6.00 and will be
effective on the date prescribed in Section 5.00.
2.00 EXECUTIVE'S EMPLOYMENT FUNCTION
2.01 POSITION. The Executive agrees to serve as the Company's Senior Vice
President Controller with the authority and duties customarily associated with
this position and to discharge any other duties and responsibilities assigned by
the Executive Vice President and Chief Financial Officer. The Executive will
report directly to and be subject to the supervision, advice and direction of
the Executive Vice President and Chief Financial Officer, or his designate. The
Executive agrees at all times to observe and be bound by all Company rules,
policies, practices, procedures and resolutions that generally apply to Company
employees of comparable status and which do not conflict with the specific terms
of this Agreement.
2.02 PLACE OF PERFORMANCE. The Executive's duties will principally be performed
in Columbus, Ohio, except for required travel on the Company's business, unless
the Executive Vice President and Chief Financial Officer requires the Executive
to perform duties at another location.
3.00 COMPENSATION
The Company will pay the Executive the amounts described in Section 3.00 as
compensation for the services described in this Agreement and in exchange for
the duties and responsibilities described in Section 4.00.
3.01 BASE SALARY. The Company will pay to the Executive an annualized base
salary of $220,000 which may be adjusted at the Company's discretion ("Base
Salary"). The Executive's Base Salary will be paid in installments that
correspond with the Company's normal payroll practices.
3.02 CASH INCENTIVE BONUS.
[1] The Executive will be eligible to receive a Cash Incentive Bonus
under the terms of the Value City Department Stores, Inc. Incentive
Compensation Plan ("Incentive Plan"), as modified by the Company. The
Company intends to provide the Executive with a cash bonus of 45 percent
of Base Salary based on the Executive's achievement of the incentive goals
established by the Company. Subsequent annual cash bonuses will be based,
in the Company's discretion, on Incentive Goals and percentages of Base
Salary determined under the Incentive Plan that is then in effect.
[2] PAYMENT OF CASH BONUS. Any Cash Incentive Bonus will be payable, in
cash, consistent with the Company's normal bonus payment policy.
3.03 EQUITY INCENTIVE.
[1] STANDARD STOCK OPTIONS. Subject to the terms of the Value City
Department Stores, Inc. 2000 Stock Incentive Plan ("Stock Incentive Plan")
and any applicable stock option agreement, the Company will grant to the
Executive options to purchase 20,000 shares of the Company's common stock
at a per share exercise price of $2.35. These options will become
exercisable pursuant to the terms set forth in the Company's standard
5-year schedule.
[2] ADDITIONAL EQUITY INCENTIVE. Subject to the Company's discretion,
the Executive will be eligible for additional discretionary grants of
stock options.
3.04 BENEFIT PLANS. Subject to their terms, the Executive may participate in
any Company sponsored employee pension or welfare benefit plan at a level
commensurate with the Executive's title and position.
3.05 VACATIONS. Subject to the terms of the Company's vacation policy, the
Executive is entitled to four weeks of vacation each calendar year to be taken
during periods approved by the Executive Vice President and Chief Financial
Officer.
3.06 EXPENSES. The Executive is entitled to receive prompt reimbursement for
all normal and reasonable expenses incurred while performing services under this
Agreement, including all reasonable travel expenses. Reimbursement for these
expenses will be made as soon as administratively feasible after the date the
Executive submits appropriate evidence of the expenditure and otherwise complies
with the Company's business expense reimbursement policy.
3.07 CAR. The Company will provide the Executive a vehicle or pay a car
allowance under the Company's car program. The car allowance will be
"grossed-up" for taxes so that the Executive incurs no net tax liability
attributable to the payments under this Section.
3.08 TERMINATION BENEFITS. The Company also will provide the Executive with the
termination benefits described in Section 5.00.
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4.00 EXECUTIVE'S OBLIGATIONS
The amounts described in Sections 3.00 and 5.00 are provided by the Company in
exchange for (and have a value to the Company equivalent to) the Executive's
performance of the obligations described in this Agreement, including
performance of the duties and the covenants and releases made and entered into
by and between the Executive and the Company in this Agreement and by the
Company in the separate change in control plan ("Change in Control Plan")
described in Section 5.06.
4.01 SCOPE OF DUTIES. The Executive will:
[1] Devote all available business time, best efforts and undivided
attention to the Company's business and affairs; and
[2] Not engage in any other business activity, whether or not for gain,
profit or other pecuniary benefit.
[3] However, the restriction described in Section 4.01[1] and [2] will
not preclude the Executive from:
[a] Making or holding passive investments in outstanding shares in
the securities of publicly-owned companies or other businesses
[other than organizations described in Section 4.05], regardless of
when and how that investment was made; or
[b] Serving on corporate, civic, religious, educational and/or
charitable boards or committees but only if this activity [i] does
not interfere with the performance of duties under this Agreement
and [ii] is approved by the Executive Vice President and Chief
Financial Officer.
4.02 CONFIDENTIAL INFORMATION.
[1] OBLIGATION TO PROTECT CONFIDENTIAL INFORMATION. The Executive
acknowledges that the Company and its subsidiaries, parent corporation and
affiliated entities (collectively, "Group" and separately, "Group Member")
have a legitimate and continuing proprietary interest in the protection of
Confidential Information (as defined in Section 4.02[2]) and have
invested, and will continue to invest, substantial sums of money to
develop, maintain and protect Confidential Information. The Executive
agrees [a] during and after employment with all Group Members [i] that any
Confidential Information will be held in confidence and treated as
proprietary to the Group, [ii] not to use or disclose any Confidential
Information except to promote and advance the Group's business interests
and [b] immediately upon separation from employment with all Group
Members, to return to the Company any Confidential Information.
[2] DEFINITION OF CONFIDENTIAL INFORMATION. For purposes of this
Agreement, Confidential Information includes any confidential data,
figures, projections, estimates, pricing data, customer lists, buying
manuals or procedures, distribution manuals or procedures, other policy
and procedure manuals or handbooks, supplier information, tax
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records, personnel histories and records, information regarding sales,
information regarding properties and any other Confidential Information
regarding the business, operations, properties or personnel of the Group
(or any Group Member) which are disclosed to or learned by the Executive
as a result of employment with any Group Member, but will not include [a]
the Executive's personal personnel records or [b] any information that [i]
the Executive possessed before the date of initial employment (including
periods before the Effective Date) with any Group Member that was a matter
of public knowledge, [ii] became or becomes a matter of public knowledge
through sources independent of the Executive, [iii] has been or is
disclosed by any Group Member without restriction on its use or [iv] has
been or is required to be disclosed by law or governmental order or
regulation. The Executive also agrees that, if there is any reasonable
doubt whether an item is public knowledge, to not regard the item as
public knowledge until and unless the Executive Vice President of Human
Resources confirms to the Executive that the information is public
knowledge or an arbitrator, acting under Section 9.00, finally decides
that the information is public knowledge.
4.03 SOLICITATION OF EMPLOYEES. The Executive agrees that during employment,
and for the longer of any period of salary continuation or for two years after
terminating employment with all Group Members [1] not, directly or indirectly,
to solicit any employee of any Group Member to leave employment with the Group,
[2] not, directly or indirectly, to employ or seek to employ any employee of any
Group Member and [3] not to cause or induce any of the Group's (or Group
Member's) competitors to solicit or employ any employee of any Group Member.
4.04 SOLICITATION OF THIRD PARTIES. The Executive agrees that during
employment, and for the longer of any period of salary continuation or for two
years after terminating employment with all Group Members not, directly or
indirectly, to recruit, solicit or otherwise induce or influence any customer,
supplier, sales representative, lender, lessor, lessee or any other person
having a business relationship with the Group (or any Group Member) to
discontinue or reduce the extent of that relationship except in the course of
discharging the duties described in this Agreement and with the good faith
objective of advancing the Group's (or any Group Member's) business interests.
4.05 NON-COMPETITION. The Executive agrees that for the longer of any period of
salary continuation or for one year after terminating employment with all Group
Members not, directly or indirectly, to accept employment with, act as a
consultant to, or otherwise perform services that are substantially the same or
similar to those for which the Executive was compensated by any Group Member
(this comparison will be based on job-related functions and responsibilities and
not on job title) for any business that directly competes with the Group's (or
any Group Member's) business, which is understood by the Parties to be the sale
of off-price and discount merchandise, including discount and off-price shoes
and accessories. Illustrations of businesses that compete with the Group's
business include The TJX Companies, Inc. (T.J. Maxx; Marshall's; HomeGoods; X.X.
Xxxxxx; Marmaxx; Winners); Shoe Carnival; MJM Designer Shoes; Xxxx Stores, Inc;
Payless ShoeSource; Off-Broadway Shoes; Famous Footwear; and Footstar. This
restriction applies to any parent, division, affiliate, newly formed or
purchased business(es) and/or successor of a business that competes with the
Group's (or any Group Member's) business.
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4.06 POST-TERMINATION COOPERATION. As is required of the Executive during
employment, the Executive agrees that during and after employment with any Group
Members and without additional compensation (other than reimbursement for
reasonable associated expenses), to cooperate with the Group (and with each
Group Member) in the following areas:
[1] COOPERATION WITH THE COMPANY. The Executive agrees [a] to be
reasonably available to answer questions for the Group's (and any Group
Member's) officers regarding any matter, project, initiative or effort for
which the Executive was responsible while employed by any Group Member and
[b] to cooperate with the Group (and with each Group Member) during the
course of all third-party proceedings arising out of the Group's (and any
Group Member's) business about which the Executive has knowledge or
information. For purposes of this Agreement, [c] "proceedings" includes
internal investigations, administrative investigations or proceedings and
lawsuits (including pre-trial discovery and trial testimony) and [d]
"cooperation" includes [i] the Executive's being reasonably available for
interviews, meetings, depositions, hearings and/or trials without the need
for subpoena or assurances by the Group (or any Group Member), [ii]
providing any and all documents in the Executive's possession that relate
to the proceeding, and [iii] providing assistance in locating any and all
relevant notes and/or documents.
[2] COOPERATION WITH THIRD PARTIES. Unless compelled to do so by
lawfully-served subpoena or court order, the Executive agrees not to
communicate with, or give statements or testimony to, any opposing
attorney, opposing attorney's representative (including private
investigator) or current or former employee relating to any matter
(including pending or threatened lawsuits or administrative
investigations) about which the Executive has knowledge or information
(other than knowledge or information that is not Confidential Information
as defined in Section 4.02[2]) as a result of employment with the Group
(or any Group Member). The Executive also agrees to notify the Executive
Vice President of Human Resources immediately after being contacted by a
third party or receiving a subpoena or court order to appear and testify
with respect to any matter affected by this section.
[3] COOPERATION WITH MEDIA. The Executive agrees not to communicate
with, or give statements to, any member of the media (including print,
television or radio media) relating to any matter (including pending or
threatened lawsuits or administrative investigations) about which the
Executive has knowledge or information (other than knowledge or
information that is not Confidential Information as defined in Section
4.02[2]) as a result of employment with the Group (or any Group Member).
The Executive also agrees to notify the Executive Vice President of Human
Resources immediately after being contacted by any member of the media
with respect to any matter affected by this section.
4.07 NON-DISPARAGEMENT. The Executive and the Company (on its behalf and in
behalf of the Group and each Group Member) agree that neither will make any
disparaging remarks about the other and the Executive will not make any
disparaging remarks about the Company's Chairman, Chief Executive Officer or any
of the Group's senior executives. However, this section will not preclude [1]
any remarks that may be made by the Executive under the terms of
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Section 4.06[2] or that are required to discharge the duties described in this
Agreement or [2] the Company from making (or eliciting from any person)
disparaging remarks about the Executive concerning any conduct that may lead to
a termination for Cause, as defined in Section 5.04[5] (including initiating an
inquiry or investigation that may result in a termination for Cause), but only
to the extent reasonably necessary to investigate the Executive's conduct and to
protect the Group's (or any Group Member's) interests.
4.08 NOTICE OF SUBSEQUENT EMPLOYMENT. The Executive agrees to notify the
Company of any subsequent employment during the period of salary continuation
after employment terminates.
4.09 NONDISCLOSURE. The Executive agrees not to disclose the terms of this
Agreement in any manner to any person other than the Chief Financial Officer,
one of the Company's Vice Presidents of Human Resources (or any Company
representative they expressly approve for such disclosure), the Executive's
personal attorney, accountant and financial advisor, and the Executive's
immediate family or as otherwise required by law.
4.10 REMEDIES. The Executive acknowledges that money will not adequately
compensate the Group for the substantial damages that will arise upon the breach
of any provision of Section 4.00. For this reason, any disputes arising under
Section 4.00 will not be subject to arbitration under Section 9.00. Instead, if
the Executive breaches or threatens to breach any provision of Section 4.00, the
Company will be entitled, in addition to other rights and remedies, to specific
performance, injunctive relief and other equitable relief to prevent or restrain
any breach or threatened breach of Section 4.00.
4.11 RETURN OF COMPANY PROPERTY. Upon termination of employment, the Executive
agrees to promptly return to the Company all property belonging to the Group or
any Group Member.
5.00 TERMINATION AND RELATED BENEFITS
This Agreement will terminate upon the occurrence of any of the events described
in this section.
5.01 RULES OF GENERAL APPLICATION. The following rules apply generally to the
implementation of Section 5.00:
[1] METHOD OF PAYMENT. The Company, at its option, may elect to pay, as
a lump sum, any installment payments due under Section 5.00. If the
Company decides to accelerate payment of any installment obligation due
under Section 5.00, the amount paid will be reduced to reflect the value
of the accelerated payment. This reduction will be based on the rate paid
under 90-day U.S. Treasury Bills issued on the first issue date after this
Agreement terminates.
[2] APPLICATION OF PRO RATA. Any pro rata share required to be paid
under Section 5.00 will be based on the number of days between the first
day of the fiscal year during which the Executive terminates employment
and the date that the Executive terminates employment divided by the
number of days in the fiscal year during which the Executive terminates
employment.
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[3] RELATIONSHIP TO CHANGE IN CONTROL PLAN. This Agreement will have no
force or effect if the Executive's employment terminates after a Change in
Control (as defined in the Change in Control Plan).
5.02 TERMINATION DUE TO EXECUTIVE'S DEATH. This Agreement will terminate
automatically on the date the Executive dies. As of that date, and subject to
Section 5.04[6], the Company will make the following payments to the person the
Executive designates on the attached Beneficiary designation form or, with
respect to any Equity Incentive, the beneficiary the Executive designates under
the Stock Incentive Plan under which the award was issued ("Beneficiary"):
[1] BASE SALARY. The unpaid Base Salary the Executive earned to the date
of termination.
[2] CASH INCENTIVE BONUS. The pro rata share of any Cash Incentive Bonus
that would have been paid to the Executive had the Executive not died
based on the extent to which performance standards are met on the last day
of the year in which the Executive dies.
[3] EQUITY INCENTIVE. Subject to the terms of any applicable agreement,
[a] the Executive's Beneficiary may exercise any outstanding stock options
that are then vested when the Executive dies and [b] those that would have
been vested on the last day of the fiscal year during which the Executive
dies if the Executive had not died.
[4] OTHER. Any rights accruing to the Executive under any employee
benefit plan, fund or program maintained by any Group Member will be
distributed or made available as required by the terms of the plan fund or
program or as required by law.
5.03 TERMINATION DUE TO EXECUTIVE'S DISABILITY. The Company may terminate this
Agreement after ascertaining that the Executive is Disabled (as defined below -
"Disability") by delivering to the Executive a written notice of termination for
Disability that includes the date termination for Disability is to be effective.
Subject to Section 5.04[6], if that notice is given and if all requirements of
this Agreement are met (including those imposed under Section 7.00), the Company
will make the following payments to the Executive:
[1] BASE SALARY. The unpaid Base Salary the Executive earned to the date
of termination.
[2] CASH INCENTIVE BONUS. The pro rata share of any Cash Incentive Bonus
that would have been paid to the Executive had the Executive not become
Disabled based on the extent to which performance standards are met on the
last day of the year in which the Executive becomes Disabled.
[3] EQUITY INCENTIVE. Subject to the terms of any applicable agreement,
[a] the Executive may exercise any outstanding stock options that are
vested when the Executive became Disabled and [b] those that would have
been vested on the last day of the fiscal year during which the Executive
becomes Disabled if the Executive had not become Disabled.
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[4] OTHER. Any rights accruing to the Executive under any employee
benefit plan, fund or program maintained by any Group Member will be
distributed or made available as required by the terms of the plan fund or
program or as required by law.
[5] DEFINITION OF DISABILITY. For these purposes, Disability means that,
for more than six consecutive months, the Executive is unable, with a
reasonable accommodation, to perform the duties described in Section 4.01
on a full-time basis due to a physical or mental disability or infirmity.
5.04 TERMINATION FOR CAUSE. The Company may terminate the Executive's
employment for Cause (as defined below - "Cause") by delivering to the Executive
a written notice describing the basis for this termination and the date the
termination for Cause is to be effective. If the Executive is terminated for
Cause and if all requirements of this Agreement are met (including those imposed
under Section 7.00), the Company will make the following payments to the
Executive:
[1] BASE SALARY. The unpaid Base Salary the Executive earned to the date
of termination.
[2] CASH INCENTIVE BONUS. Any unpaid Cash Incentive Bonus earned for the
fiscal year that ends before the fiscal year during which the Executive is
terminated for Cause (but no Cash Incentive Bonus will be given with
respect to the fiscal year during which the Executive is terminated for
Cause).
[3] EQUITY INCENTIVE. The Executive's entitlement to Equity Incentive
will be limited to those specifically described in the Company's Stock
Incentive Plan and any applicable stock option and restricted stock
agreements.
[4] OTHER. Any rights accruing to the Executive under any employee
benefit plan, fund or program maintained by any Group Member will be
distributed or made available as required by the terms of the plan fund or
program or as required by law.
[5] DEFINITION OF CAUSE. For these purposes, Cause means the Executive's
[a] failure to substantially perform the duties associated with employment
under this Agreement, but only if [i] before issuing the notice of
termination for Cause, the Company makes a written demand upon the
Executive for substantial performance and specifically describes the basis
for this demand and [ii] if the failure is one that can be cured, the
Executive does not comply within 60 days after receiving that demand; [b]
willful, illegal or grossly negligent conduct that is materially injurious
to the Company or any Group Member monetarily or otherwise; [c] violation
of laws or regulations governing the Company or to any Group Member; [d]
breach of any fiduciary duty owed to the Company or any Group Member; [e]
misrepresentation or dishonesty which the Company determines has had or is
likely to have a material adverse effect upon the Company's or any Group
Member's operations or financial condition; [f] breach of Section 4.00 of
this Agreement; [g] involvement in any act of moral turpitude that has an
injurious effect on the Company (or any Group Member) or its reputation;
or [h] breach of the terms of any non-
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solicitation or confidentiality clauses contained in an employment
agreement(s) with a former employer.
[6] SUBSEQUENT INFORMATION. The terms of Section 5.04 will apply if,
after the Executive terminates under any other provision of Section 5.00,
the Company learns of an event that, had it been known before the
Executive terminated employment, would have justified a termination for
Cause. In this case, the Company will be entitled to recover (and the
Executive agrees to repay) any amounts (other than legally protected
benefits) that the Executive received under any other provision of Section
5.00 reduced by the amount the Executive is entitled to receive under
Section 5.04.
5.05 VOLUNTARY TERMINATION BY EXECUTIVE. The Executive may voluntarily
terminate employment with the Company at any time, in which case the Company
will make the following payments to the Executive if all requirements of this
Agreement are met (including those imposed under Section 7.00):
[1] BASE SALARY. The unpaid Base Salary the Executive earned to the date
of termination.
[2] CASH INCENTIVE BONUS. Any unpaid Cash Incentive Bonus earned for the
fiscal year that ends before the fiscal year during which the Executive
voluntarily terminates (but no Cash Incentive Bonus will be given with
respect to the fiscal year during which the Executive voluntarily
terminates).
[3] EQUITY INCENTIVE. The Executive's entitlement to Equity Incentive
will be limited to those specifically described in the Company's Stock
Incentive Plan and any applicable stock option and restricted stock
agreements.
[4] OTHER. Any rights accruing to the Executive under any employee
benefit plan, fund or program maintained by any Group Member will be
distributed or made available as required by the terms of the plan fund or
program or as required by law.
5.06 TERMINATION AFTER A CHANGE IN CONTROL. Any amounts payable if the
Executive is terminated after a change in control will be determined solely
under the terms of the Change in Control Plan.
5.07 INVOLUNTARY TERMINATION WITHOUT CAUSE. The Company may terminate the
Executive's employment at any time Without Cause (as defined below) by
delivering to the Executive a written notice specifying the date termination is
to be effective. Subject to Section 5.04[6], if this notice is given and if all
requirements of this Agreement are met (including those imposed under Section
7.00), the Company will make the following payments to the Executive as of the
effective date of termination Without Cause:
[1] BASE SALARY. For 12 months beginning on the date of termination
Without Cause, the Company will continue to pay the Executive's Base
Salary at the rate in effect on the date of termination Without Cause.
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[2] HEALTH CARE. The Company will reimburse the Executive for the cost
of maintaining continuing health coverage under COBRA for a period of no
more than 12 months following the date of termination, less the amount the
Executive is expected to pay as a regular employee premium for such
coverage. Such reimbursements will cease if the Executive becomes eligible
for similar coverage under another benefit plan.
[3] CASH INCENTIVE BONUS. The pro rata share of any Cash Incentive Bonus
that would have been paid to the Executive had the Executive not been
terminated Without Cause based on the extent to which performance
standards are met on the last day of the year in which the Executive is
terminated Without Cause.
[4] EQUITY INCENTIVE. Subject to the terms of the Company's Stock
Incentive Plan and any applicable agreement, the Executive may exercise
any outstanding stock options that are vested on the date of termination
Without Cause and those that would have vested during the one year
following the effective date of termination Without Cause as if the
Executive had remained employed throughout that one-year period.
[5] OTHER. Any rights accruing to the Executive under any employee
benefit plan, fund or program maintained by any Group Member will be
distributed or made available as required by the terms of the plan fund or
program or as required by law.
[6] DEFINITION OF WITHOUT CAUSE. For purposes of this Agreement, Without
Cause means termination of the Executive's employment by the Company for
any reason other than those set forth in Section 5.02, 5.03 or 5.04.
6.00 NOTICE
6.01 HOW GIVEN. Any notice permitted or required to be given under this
Agreement must be given in writing and delivered in person or by registered,
U.S. mail, return receipt requested, postage prepaid, or through Federal
Express, UPS, DHL and any other reputable professional delivery service that
maintains a confirmation of delivery system. Any delivery must be addressed to
the Company's Executive Vice President of Human Resources at the Company's
then-current corporate offices or to the Executive at the Executive's address as
contained in the Executive's personnel file.
6.02 EFFECTIVE DATE. Any notice permitted or required to be given under this
Agreement will be effective on the date it is delivered, in the event of
personal delivery, or on the date its receipt is acknowledged, in the event of
delivery by registered mail or through a professional delivery service described
in Section 6.01.
7.00 RELEASE
In exchange for the payments and benefits described in this Agreement, as well
as any and all other mutual promises made in this Agreement, the Executive and
the Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees, legatees and assigns agree to release
and forever discharge the Company, the Group and each Group Members and their
executives, officers, directors, agents, attorneys, successors and assigns, from
any and all claims, suits and/or causes of action that grow out of or are in any
way related to the
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Executive's recruitment to or employment with the Company and all Group Members,
other than any claim that the Company has breached this Agreement. This release
includes, but is not limited to, any claims that the Company, the Group or any
Group Member violated the Employee Retirement and Income Security Act of 1974;
the Age Discrimination in Employment Act; the Older Worker's Benefit Protection
Act; the Americans with Disabilities Act; Title VII of the Civil Rights Act of
1964 (as amended); the Family and Medical Leave Act; any law prohibiting
discrimination, harassment or retaliation in employment; any claim of promissory
estoppel or detrimental reliance, defamation, intentional infliction of
emotional distress; or the public policy of any state, or any federal, state or
local law. The Executive agrees, upon termination of employment with all Group
Members, to reaffirm and execute this release in writing. If the Executive fails
to reaffirm and execute this release, the Executive agrees to forego any payment
from the Company, other than those described in Section 5.06, as if the
Executive had terminated employment voluntarily under Section 5.05.
Specifically, the Executive agrees that a necessary condition for the payment of
any of the amounts described in Section 5.00 in the event of termination (except
termination under Section 5.02) is the Executive's reaffirmation of this release
upon termination of employment. The Executive acknowledges that the Executive is
an experienced senior executive knowledgeable about the claims that might arise
in the course of employment with the Company and knowingly agrees that the
payments upon termination (except those payable upon the Executive's death)
provided for in this Agreement are satisfactory consideration for the release of
all possible claims. The Executive is advised to consult with an attorney prior
to executing this Agreement. The Executive acknowledges that 21 days have been
given to consider this release. The Executive may revoke consent to this
Agreement by delivering a written notice of such revocation to the Company
within seven days of signing this Agreement. If the Executive revokes this
consent, this Agreement will become null and void and the Executive must return
any compensation received under it, except salary earned for actual work.
8.00 INSURANCE
To the extent permitted by law and its organizational documents, the Company
will include the Executive under any liability insurance policy the Company
maintains for employees of comparable status. The level of coverage will be at
least as favorable to the Executive (in amount and each other material respect)
as the coverage of other employees of comparable status. This obligation to
provide insurance for the Executive will survive termination of this Agreement
with respect to proceedings or threatened proceedings based on acts or omissions
occurring during the Executive's employment with the Company or with any Group
Member.
9.00 ARBITRATION
9.01 ACKNOWLEDGEMENT OF ARBITRATION. Unless stated otherwise in this Agreement,
the Parties agree that arbitration is the sole and exclusive remedy for each of
them to resolve and redress any dispute, claim or controversy involving the
interpretation of this Agreement or the terms, conditions or termination of this
Agreement or the terms, conditions or termination of Executive's employment with
the Group and with each Group Member, including any claims for any tort, breach
of contract, violation of public policy or discrimination, whether such claim
arises under federal or state law.
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9.02 SCOPE OF ARBITRATION. The Executive expressly understands and agrees that
claims subject to arbitration under this section include asserted violations of
the Employee Retirement and Income Security Act of 1974; the Age Discrimination
in Employment Act; the Older Worker's Benefit Protection Act; the Americans with
Disabilities Act; Title VII of the Civil Rights Act of 1964 (as amended); the
Family and Medical Leave Act; any law prohibiting discrimination, harassment or
retaliation in employment; any claim of promissory estoppel or detrimental
reliance, defamation, intentional infliction of emotional distress; or the
public policy of any state, or any federal, state or local law.
9.03 EFFECT OF ARBITRATION. The Parties intend that any arbitration award
relating to any matter described in Section 9.00 will be final and binding on
them and that a judgment on the award may be entered in any court of competent
jurisdiction, and enforcement may be had according to the terms of that award.
This section will survive the termination or expiration of this Agreement.
9.04 LOCATION OF ARBITRATION. Arbitration will be held in Columbus, Ohio, and
will be conducted by a retired federal judge or other qualified arbitrator. The
arbitrator will be mutually agreed upon by the Parties and the arbitration will
be conducted in accordance with the Voluntary Arbitration Rules of the American
Arbitration Association then in effect. The Parties will have the right to
conduct discovery pursuant to the Federal Rules of Civil Procedure; provided,
however, that the arbitrator will have the authority to establish an expedited
discovery schedule and cutoff and to resolve any discovery disputes. The
arbitrator will have no jurisdiction or authority to change any provision of
this Agreement by alterations of, additions to or subtractions from the terms of
this Agreement. The arbitrator's sole authority will be to interpret or apply
any provision(s) of this Agreement or any public law alleged to have been
violated. The arbitrator will be limited to awarding compensatory damages,
including unpaid wages or benefits, but, to the extent allowed by law, will have
no authority to award punitive, exemplary or similar-type damages.
9.05 TIME FOR INITIATING ARBITRATION. Any claim or controversy not sought to be
submitted to arbitration, in writing, within 120 days of the date the Party
asserting the claim knew, or through reasonable diligence should have known, of
the facts giving rise to that Party's claim, will be deemed waived and the Party
asserting the claim will have no further right to seek arbitration or recovery
with respect to that claim or controversy. Both Parties agree to strictly comply
with the time limitation specified in Section 9.00. For purposes of this
section, a claim or controversy is sought to be submitted to arbitration on the
date the complaining Party gives written notice to the other that [1] an issue
has arisen or is likely to arise that, unless resolved otherwise, may be
resolved through arbitration under Section 9.00 and [2] unless the issue is
resolved otherwise, the complaining Party intends to submit the matter to
arbitration under the terms of Section 9.00.
9.06 COSTS OF ARBITRATION. The Company will bear the arbitrator's fee and other
costs associated with any arbitration, unless the arbitrator, acting under
Federal Rule of Civil Procedure 54(b), elects to award these fees to the
Company.
9.07 ARBITRATION EXCLUSIVE REMEDY. The Parties acknowledge that, because
arbitration is the exclusive remedy for resolving issues arising under this
Agreement, neither Party may resort
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to any federal, state or local court or administrative agency concerning
breaches of this Agreement or any other matter subject to arbitration under
Section 9.00, except as otherwise provided in this Agreement, and that the
decision of the arbitrator will be a complete defense to any suit, action or
proceeding instituted in any federal, state or local court before any
administrative agency with respect to any arbitrable claim or controversy.
9.08 WAIVER OF JURY. The Executive and the Company each waive the right to have
a claim or dispute with one another decided in a judicial forum or by a jury,
except as otherwise provided in this Agreement.
10.00 GENERAL PROVISIONS
10.01 REPRESENTATION OF EXECUTIVE. The Executive represents and warrants that
the Executive is not under any contractual or legal restraint that prevents or
prohibits the Executive from entering into this Agreement or performing the
duties and obligations described in this Agreement.
10.02 MODIFICATION OR WAIVER; ENTIRE AGREEMENT. No provision of this Agreement
may be modified or waived except in a document signed by the Executive and the
Company's Chief Executive Officer or other person designated by the Company's
Board of Directors. This Agreement, and any attachments referenced in the
Agreement, constitute the entire agreement between the Parties regarding the
employment relationship described in this Agreement, and any other agreements
are terminated and of no further force or legal effect. No agreements or
representations, oral or otherwise, with respect to the Executive's employment
relationship with the Company have been made or relied upon by either Party
which are not set forth expressly in this Agreement.
10.03 GOVERNING LAW; SEVERABILITY. This Agreement is intended to be performed in
accordance with, and only to the extent permitted by, all applicable laws,
ordinances, rules and regulations. If any provision of this Agreement, or the
application of any provision of this Agreement to any person or circumstance,
is, for any reason and to any extent, held invalid or unenforceable, such
invalidity and unenforceability will not affect the remaining provisions of this
Agreement of its application to other persons or circumstances, all of which
will be enforced to the greatest extent permitted by law and the Executive and
the Company agree that the arbitrator (or judge) is authorized to reform the
invalid or enforceable provision [1] to the extent needed to avoid the
invalidity or unenforceability and [2] in a manner that is as similar as
possible to the intent (as described in this Agreement). The validity,
construction and interpretation of this Agreement and the rights and duties of
the Parties will be governed by the laws of the State of Ohio, without reference
to the Ohio choice of law rules.
10.04 NO WAIVER. Except as otherwise provided in Section 9.05, failure to insist
upon strict compliance with any term of this Agreement will not be considered a
waiver of any such term.
10.05 WITHHOLDING. All payments made to the Executive under this Agreement will
be reduced by any amount:
[1] That the Company is required to withhold in advance payment of the
Executive's federal, state and local income, wage and employment tax
liability; and
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[2] To the extent allowed by law, that the Executive owes (or, after
employment is deemed to owe) to the Company.
However, application of Section 10.05[2] will not extinguish the Company's right
to seek additional amounts from the Executive (or to pursue other appropriate
remedies) to the extent that the amount that may be recovered by application of
Section 10.05[2] does not fully discharge the amount the Executive owes to the
Company and does not preclude the Company from proceeding directly against the
Executive without first exhausting its right of recovery under Section 10.05[2].
10.06 SURVIVAL. Subject to the terms of the Executive's Beneficiary designation
form, the Parties agree that the covenants and promises set forth in this
Agreement will survive the termination of this Agreement and continue in full
force and effect.
10.07 MISCELLANEOUS.
[1] The Executive may not assign any right or interest to, or in, any
payments payable under this Agreement; provided, however, that this
prohibition does not preclude the Executive from designating in writing
one or more beneficiaries to receive any amount that may be payable after
the Executive's death and does not preclude the legal representative of
the Executive's estate from assigning any right under this Agreement to
the person or persons entitled to it.
[2] This Agreement will be binding upon and will inure to the benefit of
the Executive, the Executive's heirs and legal representatives and the
Company and its successors.
[3] The Executive's rights under this Agreement will be solely those of
an unsecured general creditor of the Company.
[4] The headings in this Agreement are inserted for convenience of
reference only and will not be a part of or control or affect the meaning
of any provision of the Agreement.
10.08 SUCCESSORS TO COMPANY. This Agreement may and will be assigned or
transferred to, and will be binding upon and will inure to the benefit of, any
successor of the Company, and any successor will be substituted for the Company
under the terms of this Agreement. As used in this Agreement, the term
"successor" means any person, firm, corporation or business entity which at any
time, whether by merger, purchase or otherwise, acquires all or essentially all
of the assets of the business of the Company. Notwithstanding any assignment,
the Company will remain, with any successor, jointly and severally liable for
all its obligations under this Agreement.
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IN WITNESS WHEREOF, the Parties have duly executed and delivered this
Agreement, which includes an arbitration provision, and consists of 15 pages.
EXECUTIVE
/s/ Xxxxxx X. Xxxxxx
------------------------------
Signed: October 7, 2003
VALUE CITY DEPARTMENT STORES, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
------------------------------
Signed: October 10, 2003
15 Initials ______ Date ______
