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EXHIBIT (10)(x)
Material Contracts -- Reduced Hour Agreement
between Xxxxxxx Gordman 1/2 Price Stores, Inc.
and Xxxx Xxxxxxxxxx dated February 1, 1997
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REDUCED HOUR AGREEMENT
This Reduced Hour Agreement (the "Agreement") is entered into as of the 1st
day of February, 1997, between XXXXXXX GORDMAN 1/2 PRICE STORES, INC., a
Delaware corporation with its principal office located at 00000 Xxxx Xxxxxx
Xxxx, Xxxxx, Xxxxxxxx 00000 (the "Company") and Xxxx Xxxxxxxxxx (the
"Employee"), who resides at 0000 X. 000xx Xxxxxx, Xxxxx, Xxxxxxxx 00000.
WHEREAS, the Company and the Employee entered into an Employment Agreement
as of January 18, 1995 (the "Employment Agreement"), whereby the Employee was
employed to serve as Vice President of Human Resources for the Company on a
full-time basis for a term of three years; and
WHEREAS, since the time the Employment Agreement was entered into, the
Employee has begun the study of law on a part-time basis; and
WHEREAS, the Company and the Employee desire to terminate the Employment
Agreement and to provide for the terms and conditions under which the Employee
may continue his employment with the Company while attending law school;
NOW, THEREFORE, the parties agree as follows:
1. REDUCED HOURS EMPLOYMENT. The Employee shall continue to serve, at the
discretion of the Company, as the Vice President of Human Resources while he
attends law school at Xxxxxxxxx University School of Law on a part-time basis.
During such part-time status, he shall be available at the offices of the
Company whenever possible during normal work hours and, in any event, not less
than 35 hours per week. The Employee shall be responsible for fulfilling his
duties as Vice President of Human Resources notwithstanding his reduced hours.
2. COMPENSATION. During the time that this Agreement is in effect, the
Employee shall receive a base salary of $115,000. The Employee shall also
receive the fringe benefits reflected on Exhibit A to this Agreement and shall
be permitted to participate in the Company's cash incentive program for fiscal
year 1997, the terms of which are described in Exhibit B to this Agreement (the
"Cash Incentive Plan"). Solely for purposes of the Cash Incentive Plan, the
Employee shall be deemed to be a full-time employee participant. During the term
of this Agreement, the Employee shall not be eligible to participate in any
stock option plan adopted by the Company.
3. REIMBURSEMENTS TO COMPANY. For the school year which commenced August,
1996, and for each school year thereafter that this Agreement is in effect, the
Company will pay one-half of the Employee's tuition, plus one-half of related
school expenses not to exceed $5,000 in the aggregate (together, the "School
Expenses"). As agreed between the Employee and the Company, the Employee is
responsible for repaying to the Company the sum of $20,000 per school year,
which amount represents the
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amount of tuition and expenses paid by the Company and the reduced hours of the
Employee. The Employee has executed and delivered to the Company a note in the
principal amount of $20,000 for the school year commencing August, 1996, and
will execute a note for each succeeding school year during the time that this
Agreement is in effect. Each such note (together, the "Notes") will bear
interest at the rate of 8% per annum and will mature on August 15, 2001, as set
forth in the form of note attached as Exhibit C to this Agreement.
4. TERMINATION. The Company may terminate this Agreement at any time by
giving the Employee written notice at least four (4) weeks prior to the
beginning of a school semester. At such time the Company shall have the right,
but not the obligation, to propose an employment agreement whereby the Employee
would again become a full-time employee of the Company.
5. AT WILL CONTRACT. This Agreement reflects that the Employee is an
employee at will of the Company. In the event that the Employee elects to
resign, the Employee shall be entitled only to the unpaid portion of base salary
and fringe benefits through the termination date, plus any accrued and unpaid
vacation pay. In the event that the Company elects to terminate the Employee,
the Employee shall be entitled (in addition to the benefits specified in the
preceding sentence) to other termination benefits, if any, which the Company
provides to terminated employees at the vice president level pursuant to the
Company's written policies (but not pursuant to employment agreements applicable
to specific vice presidents).
6. CANCELLATION, ACCELERATION OF NOTES. The Notes will be canceled in whole
or in part upon the occurrence of certain events, as indicated below:
(a) Upon termination of this arrangement by the Company pursuant to
Paragraph 4 above prior to the earlier of the Employee's graduation
from law school or August 15, 2001, all principal and accrued
interest on the Notes will be canceled.
(b) Upon termination of the Employee's law school education prior to
graduation at the choice of the Employee, the principal and accrued
interest on the Notes will be canceled at such time as the Employee
has completed full-time employment with the Company equal to the
number of months as the Employee had worked reduced hours while
attending law school, in each case rounded to six-month increments.
(c) Upon the Employee's graduation from law school, one-third of the
aggregate principal and accrued interest on the Notes will be
canceled for each full year of full-time employment that the Employee
works for the Company following such graduation.
(d) The aggregate principal and accrued interest on the Notes will also
be canceled in the event that (i) the Company terminates the Employee
without cause, or (ii)
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the Company ceases operations, or (iii) upon written approval of the
Chief Executive Officer of the Company. For purposes of this
paragraph, "cause" means a reason which a reasonable employer, acting
in good faith, would regard as good and sufficient reason for
terminating the services of an employee, as distinguished from an
arbitrary whim or caprice. "Cause" includes, without limitation,
termination of employment as a result of the Employee's poor
performance or misconduct or his breach of this Agreement.
(e) The aggregate principal and accrued interest on the Notes will also
be canceled in the event that, while the Employee is still employed
by the Company, the Employee dies or becomes permanently disabled, as
described in Paragraph 12 below.
The Notes may be accelerated at the option of the Company in the event that
the Employee is terminated for misconduct or voluntarily terminates his
employment with the Company other than under the circumstances described in
subparagraph (d)(ii) above. For purposes of this paragraph, "misconduct" means
behavior by the Employee which evidences (aa) wanton or willful disregard of the
Company's interests; (bb) deliberate violation of the Company's rules, policies,
or procedures; (cc) disregard of standards of behavior which the Company can
rightfully expect from the Employee; or (dd) negligence which manifests
culpability, wrongful intent, evil design, or intentional and substantial
disregard of the Company's interests or of the Employee's duties and
obligations.
7. TERMINATION OF EMPLOYMENT AGREEMENT. Upon the execution and delivery of
this Agreement, the Employment Agreement shall terminate in its entirety as if
the termination date thereof had been amended to February 1, 1997, and the
Employment Agreement shall be of no further force and effect. Thereafter, all
rights and obligations between the Company and the Employee will be determined
in accordance with this Agreement.
8. EMPLOYMENT POLICIES AND PROCEDURES. The Employee agrees to abide by all
of the Company's employment policies and procedures that apply generally to
other employees at the same level and responsibility of the Employee, as such
policies and procedures may be revised from time to time.
9. PERFORMANCE EVALUATION. The Employee's performance shall be evaluated on
an annual basis. The results of the evaluations shall be discussed with the
Employee.
10. COOPERATION WITH EMPLOYER AFTER TERMINATION OF EMPLOYMENT. Following
the termination of the Employee's employment, by either the Employee or the
Company, the Employee shall fully cooperate with the Company in all matters
relating to the continuation or completion of the Employee's pending work on
behalf of the Employer and the orderly transfer of any such pending work to
other employees as may be designated by the Company. The Company shall be
entitled to such full-time or part-time services of the Employee as the Company
may reasonably require during all or any
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part of the 30-day period following any notice of termination of employment by
the Employee.
11. EMPLOYEE'S RELATIONSHIP WITH OTHER EMPLOYEES. The Company and the
Employee agree that any attempt on the part of the Employee to induce others to
leave the employ of the Company, or any effort by the Employee to interfere with
the Company's relationship with other employees, will be harmful and damaging to
the Company. The Employee therefore expressly agrees that, in consideration of
the Company's willingness to enter into this Reduced Hours Agreement, during the
term of this Agreement and for a period of two years thereafter, he will not in
any way, directly or indirectly (a) induce or attempt to induce any employee to
quit employment with the Company, (b) interfere with or disrupt the Company's
relationship with other employees, or (c) employ or attempt to employ any person
employed by the Company.
12. TERMINATION BY DEATH OR INCAPACITY OF EMPLOYEE. This Agreement shall
terminate immediately if the Employee dies or becomes permanently disabled. As
used in this Agreement, "permanently disabled" is defined as the inability of
the Employee to perform the essential functions of his position, either with or
without reasonable accommodation, for a period extending beyond six months. In
the event of such death or permanent disability, Subparagraph 6(e) will survive
the termination of this Agreement.
13. ASSUMPTION AND MERGER. The rights and duties of the Company and the
Employee under this Agreement shall not be assignable by either party, except
that this Agreement and all of the rights hereunder may be assigned by the
Company to any corporation or other business entity that succeeds to the
business of the Company through merger, consolidation, corporate re-organization
or by acquisition of all or substantially all of the assets of the Company, and
which assumes the Company's obligations under this Agreement.
14. AGREEMENT OUTSIDE OF CONTRACT. This Agreement contains the complete
agreement concerning the employment arrangement between the Company and the
Employee and shall, as of the effective date hereof, supersede all other
agreements between them. The Company and the Employee agree that neither of them
has made any representation with respect to the subject matter of this Agreement
except such representations as are specifically set forth in this Agreement. The
Company and the Employee acknowledge that each of them has relied on its or his
own judgment in entering into this Agreement. The Company and the Employee
further acknowledge that any payments or representations that may have been made
by either of them to the other prior to the date of executing this Agreement are
of no effect and that neither of them has relied thereon in connection with
their dealings with the other.
15. MODIFICATION OF AGREEMENT. Any modification of this Agreement or
additional obligations assumed by either the Company or the Employee in
connection with
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this Agreement shall be binding only if evidenced in writing signed by both the
Company and the Employee or their authorized representatives.
16. EFFECT OF PARTIAL INVALIDITY. The invalidity of any portion of this
Agreement shall not be deemed to affect the validity of any other provision of
this Agreement. In the event that any provision of this Agreement is held to be
invalid, the Company and the Employee agree that the remaining provisions shall
be deemed to be in full force and effect as if they had been executed by both
parties subsequent to the expungement of the invalid provision.
17. CHOICE OF LAW AND FORUM. It is the intention of the Company and the
Employee that this Agreement and any actions and special proceedings brought in
connection with this Agreement be construed in accordance with and pursuant to
the laws of the State of Nebraska, which shall govern to the exclusion of the
law of any other forum. The Company and the Employee further agree that any
action or special proceeding that may be brought in connection with this
Agreement shall be brought in the State of Nebraska.
18. ARBITRATION. Any differences, claims or matters in dispute between the
Company and the Employee in connection with this Agreement shall be submitted by
them to arbitration by the American Arbitration Association or its successor,
and the determination of the arbitrator or its successor shall be final and
absolute. The arbitrator shall be governed by the duly promulgated rules and
regulations of the American Arbitration Association or its successor, and the
pertinent provisions of the laws of the State of Nebraska, relating to
arbitration. The decision of the arbitrator may be entered as a judgment in any
court of the State of Nebraska or elsewhere.
19. NO WAIVER. The failure of either the Company or the Employee to insist
upon the performance of any of the terms and provisions of this Agreement, or
the waiver of any breach of any of the terms or provisions of this Agreement,
shall not be construed as thereafter waiving any such terms and provisions, but
the same shall continue and remain in full force and effect as if no such
forbearance or waiver had occurred.
IN WITNESS WHEREOF, the Company and the Employee have executed this
Agreement as of the day and year first above written.
XXXXXXX GORDMAN EMPLOYEE:
1/2 PRICE STORES, INC.
/s/ Xxxxxxx X. Xxxxxxx /s/ Xxxx Xxxxxxxxxx
---------------------------- -----------------------------
Xxxxxxx X. Xxxxxxx Xxxx Xxxxxxxxxx
President and CE0
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EXHIBIT "C"
PROMISSORY NOTE
Omaha, Nebraska $20,000.00
_______________ August 15, 2001
(Note Date) (Maturity Date)
XXXX XXXXXXXXXX ("Maker") promises to pay to the order of XXXXXXX GORDMAN
1/2 PRICE STORES, INC. ("Lender") at the offices of Lender the principal sum of
$20,000.00. Principal and interest on the unpaid principal balance shall be due
at maturity, or if such day is not a Business Day, on the next succeeding
Business Day. All capitalized terms not defined herein shall have the meanings
set forth in that certain Reduced Hour Agreement dated as of February 1, 1997,
between Maker as Employee and Lender as Employer (the "Agreement".)
Interest shall accrue on the principal sum hereof from and including the
Note Date above until paid at the rate of 8%. After the maturity date hereof,
interest shall be due at the rate of 10%. Interest shall be calculated on the
basis of actual days elapsed and a year of 365 days.
This Promissory Note (the "Note) is one of the promissory notes specified
in the Agreement and is subject to being accelerated or canceled in accordance
with the terms of the Agreement.
Maker's liability under its obligations hereunder shall not be affected by
any of the following:
Acceptance or retention by Lender of property or interests as
security for the obligations, or for the liability of any person other than
a Maker with respect to the obligations;
The release of all or any collateral or other security for any of the
obligations;
or
Any release, extension, renewal, modification or compromise of any of
the obligations or the liability of Maker.
Maker agrees to pay all costs of collection in connection with this Note,
including reasonable attorneys' fees and legal expenses.
Upon the failure of Maker to make any payment of principal or interest when
due hereunder all of the Obligations shall, at the option of Lender and without
notice or demand, mature and become immediately due and payable; and Lender
shall have all rights and remedies for default provided by applicable law and
equity.
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All costs and expenses incurred by Lender in enforcing its rights under
this Note or any agreement given in security thereof are the obligations of
Maker and are immediately due and payable. Interest shall accrue on such costs
and expenses from the date of incurrence at the rate specified herein for
delinquent Note payments. Maker hereby waives presentment, protest, demand,
notice of dishonor, and the defense of any statute of limitations.
Without affecting the liability of any Maker, endorser, surety or
guarantor, the holder of this Note may, without notice, renew or extend the time
for payment, accept partial payments, release or impair any collateral or other
security for the payment of this Note or agree not to xxx any party liable on
it.
Lender shall not be deemed to have waived any of its rights upon or under
this Note, or under any agreement given in security therefor, unless such
waivers be in writing and signed by Lender or Agent, as the case may be. No
delay or omission on the part of Lender in exercising any right shall operate as
a waiver of such right or any other right. A waiver on any one occasion shall
not be construed as a bar to or waiver of any right on any future occasion. All
rights and remedies of Lender on liabilities or any collateral, whether
evidenced hereby or by any other instrument or papers, shall be cumulative and
may be exercised singularly or concurrently.
Subject to the cancellation provisions set forth in the Agreement, this
Note shall be binding upon the heirs, executors, administrators, assigns or
successors of Maker; shall constitute a continuing agreement, applying to all
future as well as existing transactions, whether or not of the character
contemplated at the date of this Note, and if all transactions between Lender
and Maker shall be at any time closed, shall be equally applicable to any new
transactions thereafter, provided that Lender's interest in any collateral shall
be limited to the extent provided in the applicable security agreement; shall
benefit Lender, its successors and assigns; and shall so continue in force
notwithstanding any change in any party hereto, whether such change occurs
through death, retirement or otherwise.
All obligations of Maker hereunder shall be payable in immediately
available funds in lawful money of the United States of America at the principal
office of Lender or at such other address as may be designated by any subsequent
holder hereof in writing.
This Note shall be construed according to the laws of the State of
Nebraska.
Any provision of this Note which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.
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Executed as of this _____ day of ________________, 19_____.
XXXX XXXXXXXXXX
______________________________
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