EXHIBIT 10.2
AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT
BETWEEN XXXXXXX.XXX, INC. AND XXXXX XXXXXX
XXXXXXX.XXX, INC. (the "Company"), as successor to EGGHEAD, INC., and Xxxxx
Xxxxxx ("Executive") are parties to an EMPLOYMENT AGREEMENT (the "Agreement"),
dated and effective as of January 22, 1998. The Company and Executive now wish
to amend the Agreement as set forth below, with amendments effective as of June
30, 1999. The Company and the Executive agree and acknowledge the sufficiency of
consideration for these amendments based on the mutual benefits conferred.
A. Term of the Agreement
Executive and the Company have discussed changes in Executive's work
situation due to both the relocation of the Company's finance department and
Executive's desire to remain in the Spokane, Washington area. The Company wants
to continue Executive's employment until at least October 31, 1999, or the date
of a Change of Control, as defined in the Agreement. Executive and the Company
therefore mutually agree to amend Section 1.1 of the Agreement to read as
follows:
This Agreement will extend from the Effective Date to the earlier of
the effective date of a Change of Control (as defined in Attachment A
to the Agreement) or October 31, 1999.
B. Termination Prior to the End of Term.
The first sentence of Section 4.1(a)(i) is hereby amended to read as
follows: "In the event that Executive exercises his right under this subsection,
he shall provide notice of his intent to terminate the Agreement not less than
five (5) days before the effective date of the termination." The first sentence
of Section 4.1(a)(ii) is hereby amended by inserting the phrase "to terminate
this Agreement without Cause" directly after the phrase "In the event that the
Company exercises its right".
C. Duties of the Executive and Termination for Good Reason
The Executive and the Company agree that the Company may modify the
Executive's status, duties and/or responsibilities under Section 3.1 of the
Agreement during the remaining term of his employment under the Agreement.
Executive and the Company mutually agree to amend Subsection 4.1(b) of the
Agreement to read as follows:
b) Executive may, at his option, terminate this Agreement prior to
the end of the term for Good Reason. For purposes of this subsection,
Executive will have Good Reason to terminate his employment under this
Agreement if Executive is relocated to a facility other than the
Company's office in Spokane, Washington; or the Company has materially
breached its obligations under the Agreement (provided that the
Company has been given warning and notice of its alleged material
breach and a reasonable opportunity to correct the alleged material
breach) other than its obligations under Section 3.1 of the Agreement.
Executive's resignation at the conclusion of the term of this
Agreement, as amended herein, shall also be deemed a termination for
Good Reason, entitling Executive to severance benefits described in
Section 4.2 of the Agreement.
D. Termination Prior to the End of Term
Section 4.1(c) of the Agreement is hereby amended by deleting the phrase,
"provided that Executive's right to exercise stock options awarded
pursuant to the EGGHEAD, INC. 1993 STOCK OPTION PLAN shall be governed
by the terms of that plan"
and inserting in lieu thereof the phrase,
"provided that Executive's right to exercise stock options awarded
pursuant to the EGGHEAD, INC. 1993 STOCK OPTION PLAN, as amended or
restated from time to time (the "Plan"), shall be governed by the
terms of the Plan."
X. Xxxxxxxxx Benefits, Change of Control
The following parenthetical in the first sentence of Section 4.2(a) is
hereby deleted: "(the 'Initial Period')." The first sentence of Section 4.2(b)
is hereby amended by deleting the phrase "prior to the end of the Initial
Period," and inserting in lieu thereof the phrase, "prior to the first
anniversary of the Termination Date (such period, the "Initial Period"), then
from the end of the Initial Period".
X. Xxxxxxxxx Benefits, Change of Control
Section 4.2(c) of the Agreement is hereby amended by deleting the phrase,
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"Any stock option(s) issued to Executive pursuant to the EGGHEAD, INC.
1993 STOCK OPTION PLAN (the "Plan")"
and inserting in lieu thereof the phrase,
"Any stock option(s) issued to Executive pursuant to the Plan"
X. Xxxxxxxxx Benefits; Change of Control.
Subsection 4.2(e) of the Agreement is hereby amended by adding the
following clause to the end of the sentence in subsection 4.2(e):
", except that any stock options issued to the Executive pursuant to
the Plan after January 1, 1999 ("Post-1998 Options") shall not be
subject to this subsection 4.2(e)"
X. Xxxxxxxxx Benefits; Change of Control
A new Subsection 4.2(f) shall be added as follows:
f) The Company and Executive shall enter into a Pledge
Agreement in substantially the form attached hereto as Attachment B
for the purpose of holding any sums that may become payable pursuant
to Subsection 4.2(a) in the event of a termination or resignation.
I. Non-Solicitation
Section 5.2 of the Agreement is amended by deleting the term "Severance
Period" in the first sentence and replacing that term with the term "Initial
Period."
J. Confirmation
Except as expressly modified by this Amendment, all terms and conditions in
the Agreement and any other amendments thereto are hereby confirmed and remain
in full force and effect.
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WHEREFORE, effective June 30, 1999, the undersigned parties accept and agree to
these amendments to the Agreement.
XXXXXXX.XXX, INC. XXXXX XXXXXX
By /s/ Xxxxxx Xxxxx /s/ Xxxxx Xxxxxx
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Its Chief Executive Officer
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