EXHIBIT 10.92
SEVERANCE AGREEMENT
BETWEEN
GOODY'S FAMILY CLOTHING, INC.
AND
XXXXXXX X. XXXXXX, XX.
TABLE OF CONTENTS
1 Definitions ...................................................... 1
2 Termination of Employment ........................................ 2
3 Obligations of the Company Upon Termination ...................... 3
4 Non-exclusivity of Rights ........................................ 5
5 No Duty to Mitigate .............................................. 5
6 Arbitration of Disputes .......................................... 5
7 Confidential Information and Nonsolicitation ..................... 6
8 Successors ....................................................... 6
9 Miscellaneous .................................................... 7
SEVERANCE AGREEMENT
THIS SEVERANCE AGREEMENT, by and between GOODY'S FAMILY CLOTHING,
INC., a Tennessee corporation (the "Company"), and XXXXXXX X. XXXXXX, XX. (the
"Executive"), shall be effective as of the 19th day of June, 2002.
RECITALS:
A. The Executive has been appointed to the position of Vice
President of Finance and Corporate Controller of the Company.
B. The Company desires to recognize the Executive's commitment
to the Company and to confirm the right of the Executive to certain severance
benefits. To attain that end, the Company and the Executive wish to enter into
this Severance Agreement (the "Agreement").
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, and other good and valuable consideration, the Company and
the Executive do hereby agree as follows:
1. Definitions.
(a) "Accrued Obligations" shall mean (i) the Executive's
Base Salary through the Date of Termination, (ii) any amounts deferred by the
Executive and not yet paid by the Company pursuant to a valid election to defer
the receipt of all or a portion of such payments made in accordance with any
plan of deferred compensation sponsored by the Company and any earned but
unpaid vacation pay for the current year, (iii) any amounts or benefits owing
to the Executive or to the Executive's beneficiaries under the then applicable
employee benefit plans or policies of the Company and (iv) any amounts owing to
the Executive for reimbursement of expenses properly incurred by the Executive
through the Date of Termination and which are reimbursable in accordance with
the reimbursement policy of the Company.
(b) "Board" shall mean the Board of Directors of the
Company.
(c) "Cause" shall mean that the Executive has, in the
judgment of a majority of the Senior Executive Officer Group (i) committed a
felony, or committed an act of fraud, embezzlement or theft in connection with
his duties with the Company or in the course of his employment with the
Company; (ii) willfully caused damage to property of the Company; (iii) been
convicted of a criminal offense (either a misdemeanor involving acts of
dishonesty, theft or moral turpitude, or a felony); or (iv) engaged in a
willful and material breach of his obligations to the Company (including
without limitation, his obligation to devote his full business time to the
business and affairs of the Company and to use his best efforts to perform
faithfully and efficiently the responsibilities assigned to him) which breach
(under this clause iv) has been communicated to the Executive with specificity
by written notice, and which has not been cured to the reasonable
satisfaction of the Senior Executive Officer Group within a reasonable period
of time, which shall not be less than ten (10) days, nor more than thirty (30)
days, following receipt of such written notice by the Executive. The Senior
Executive Officer Group shall provide the Executive with an opportunity to meet
with the Senior Executive Officer Group in order to provide the Executive an
opportunity to refute or explain acts or omissions referred to in such written
notice. For the purpose of this paragraph, no act or omission shall be
considered willful unless done or omitted to be done in bad faith and without
reasonable belief that such act or omission was done in the best interest of
the Company.
(d) "Date of Termination" shall have the meaning set
forth in Section 2(e).
(e) "Disability" shall mean disability whereby the
Executive is unable to render the services provided for by this Agreement by
reason of illness, injury or incapacity (whether physical, mental, emotional or
psychological) for a period of either (i) ninety (90) consecutive days or (ii)
one hundred eighty (180) days in any consecutive three hundred sixty-five (365)
day period.
(f) "Incentive Bonus" shall mean the annual incentive
target bonus payable under the Incentive Plan.
(g) "Incentive Plan" shall mean the Company's "Short
Term Incentive Plan" under which certain employees are eligible to receive an
annual incentive target bonus based on performance and other specific
objectives adopted by the Compensation Committee of the Board.
(h) "Notice of Termination" shall have the meaning as
set forth in Section 2(d).
(i) "Qualified Plan" shall mean any retirement plan
maintained by the Company which is intended to meet the requirements of the
Internal Revenue Code of 1986, as amended.
(j) "Senior Executive Officer Group" shall mean the
Company's senior vice presidents, executive vice presidents, president and/or
chief operating officer, and chief executive officer, and any other senior
executives of the Company holding similar positions with the Company as may be
appointed by the Board from time to time.
(k) "Subsidiary" shall mean any majority-owned
subsidiary of the Company.
(l) "Supplemental Payment Date" shall have the meaning
as set forth in Section 3(c).
2. Termination of Employment.
(a) Disability; Death. The Company may terminate the
Executive's employment after having established the Executive's Disability, by
giving to the Executive written notice of its intention to terminate his
employment, and his employment with the Company shall terminate effective on
the thirtieth (30th) day after receipt of such notice if the Executive shall
fail to return to
full-time performance of his duties within thirty (30) days after such receipt.
If the Executive dies during the term of this Agreement, his employment
hereunder shall be deemed to cease as of the date of his death.
(b) Voluntary Termination by the Executive.
Notwithstanding anything in this Agreement to the contrary, the Executive may,
upon not less than thirty (30) days' written notice to the Company, voluntarily
terminate employment for any reason (including retirement under the terms of
the Company's retirement plan as in effect from time to time).
(c) Termination by the Company. The Company at any time
may terminate the Executive's employment for Cause or without Cause.
(d) Notice of Termination. Any termination by the
Company for Cause shall be communicated by a written Notice of Termination to
the other party hereto given in accordance with Section 9(c). For purposes of
this Agreement, a "Notice of Termination" means a written notice given in the
case of a termination for Cause which (i) indicates the specific termination
provision in this Agreement relied upon, (ii) sets forth in reasonable detail
the facts and circumstances claimed to provide a basis for termination of the
Executive's employment, and (iii) if the termination date is other than the
date of receipt of such notice, specifies the termination date (which date
shall be not more than thirty (30) days after the receipt of such notice).
(e) Date of Termination. For the purpose of this
Agreement, the term "Date of Termination" means (i) in the case of a
termination for Cause, the date of receipt of a Notice of Termination or, if
later, the date specified therein, and (ii) in all other cases, the actual date
on which the Executive's employment terminates.
3. Obligations of the Company Upon Termination. Upon termination
of the Executive's employment with the Company, the Company shall have the
following obligations:
(a) Death, Disability and Retirement. If the Executive's
employment is terminated by reason of the Executive's death, Disability, or
retirement on or after the attainment of age sixty-five (65), the Company shall
have no further obligations to the Executive's legal representatives under this
Agreement other than payment of the Accrued Obligations. If the Executive's
employment is terminated by reason of the Executive's death or Disability, the
Company shall have the additional obligation, subject to the terms of the
Incentive Plan and further provided that the Executive has been employed by the
Company for the first six (6) months of the then applicable fiscal year, to pay
a cash amount equal to a portion of the Incentive Bonus, the product of a
fraction, the numerator of which is the number of days elapsed since the date
the Incentive Plan began for the applicable fiscal year through the date of the
Disability or the date of death of the Executive, and the denominator of which
is the total number of days of the applicable fiscal year for such Incentive
Plan. Unless otherwise directed by the Executive (or, in the case of the
Incentive Plan or a Qualified Plan, as may be required by such Incentive Plan
or Qualified Plan) all Accrued Obligations shall be paid to the
Executive, his beneficiaries or his estate, as applicable, in a lump sum in
cash within thirty (30) days of the Date of Termination.
(b) Termination by the Company for Cause and Voluntary
Termination by the Executive. If the Executive's employment shall be terminated
for Cause or voluntarily terminated by the Executive, the Company shall pay the
Executive the Accrued Obligations. The Executive shall be paid all such Accrued
Obligations in a lump sum in cash within thirty (30) days of the Date of
Termination and the Company shall have no further obligations to the Executive
under this Agreement, unless otherwise required by a Qualified Plan or
specified pursuant to a valid election to defer the receipt of all or a portion
of such payments made in accordance with any plan of deferred compensation
sponsored by the Company.
(c) Other Termination of Employment. If the Company
terminates the Executive's employment other than for Cause, death or
Disability, the Company shall pay and provide to the Executive the following:
(i) Severance Payment. The Company shall pay to
the Executive in a lump sum in cash or
certified check within fifteen (15) days after the Date of Termination a
severance payment equal to the sum of the following amounts (other than amounts
payable from the Incentive Plan or Qualified Plans, non-qualified retirement
plans and deferred compensation plans, which amounts shall be paid in
accordance with the terms of such plans):
(A) all Accrued Obligations;
(B) a cash amount equal to three (3)
months of the Executive's Base Salary at the rate in effect as of the date when
the Notice of Termination was given;
(C) subject to the terms of the
Incentive Plan and further provided that the Executive has been employed by the
Company for the first six (6) months of the then applicable fiscal year, a cash
amount equal to a portion of the Incentive Bonus, the product of a fraction,
the numerator of which is the number of days elapsed since the date the
Incentive Plan began for the applicable fiscal year through the date of such
termination without Cause, and the denominator of which is the total number of
days of the applicable fiscal year for such Incentive Plan.
In addition, if the Executive has not accepted
employment from a subsequent employer prior to the date which is four (4)
months from the Date of Termination (the "Supplemental Payment Date"),
commencing on the Supplemental Payment Date the Company shall pay the Executive
an amount equal to fifty percent (50%) of his monthly Base Salary at the rate
in effect as of the date when the Notice of Termination was given in equal
monthly installments until the earlier of (i) the payment of the third (3rd)
monthly installment or (ii) the date of the Executive's acceptance of
employment from a subsequent employer. The Executive shall notify the Company
immediately upon his acceptance of any such new
employment if secured prior to the payment by the Company of such three (3)
additional monthly installments.
(d) Release. As a condition precedent to the receipt of
any termination benefits payable to the Executive under this Section 3, the
Executive agrees to execute a general release among other things releasing the
Company from any obligation or liability (other than those contained in
Sections 3, 6, 8 and 9 hereof, to the extent an obligation under such section
arose at or prior to the Date of Termination and remains unfulfilled). Such
release shall exclude the Executive's rights under any Qualified Plan.
(e) Discharge of Company's Obligations. Subject to the
performance of its obligations under Sections 3, 6, 8 and 9 (and then, only to
the extent an obligation under such section arose at or prior to the Date of
Termination and remains unfulfilled), the Company shall have no further
obligations to the Executive under this Agreement in respect of any termination
of employment.
4. Non-exclusivity of Rights. Nothing in this Agreement shall
prevent or limit the Executive's continuing or future participation in any
benefit, bonus, incentive or other plan or program provided by the Company and
for which the Executive may qualify, nor shall anything herein limit or
otherwise prejudice such rights as the Executive may have under any other
agreements with the Company, including, but not limited to stock option
agreements. Amounts which are vested benefits or which the Executive is
otherwise entitled to receive under any plan or program of the Company at or
subsequent to the Date of Termination shall be payable in accordance with such
plan or program.
5. No Duty to Mitigate. The Executive shall not be obligated to
seek other employment by way of mitigation of the amounts payable to the
Executive under any of the provisions of this Agreement.
6. Arbitration of Disputes. In the event that a claim for
payment or benefits under this Agreement is disputed, the Company and the
Executive agree to submit such dispute to final and binding arbitration with
United States Arbitration and Mediation, Inc. ("USAM") in Knoxville, Tennessee
or such other arbitration firm as the Company and the Executive shall mutually
agree. Either party wishing to arbitrate any claim hereunder shall notify the
other party and USAM in writing whereupon USAM shall select a neutral
arbitrator and shall schedule an arbitration hearing within thirty (30) days of
receipt of such notice of arbitration. The arbitration shall be conducted in
accordance with the rules and procedures of USAM. The parties agree that any
arbitrator's award may be presented to a court of competent jurisdiction and
judgment entered thereon.
7. Confidential Information and Nonsolicitation.
(a) The Executive shall hold in a fiduciary capacity for
the benefit of the Company all secret or confidential information, knowledge or
data, including without
limitation all trade secrets, relating to the Company, and its business, (i)
obtained by the Executive during his employment by the Company, and (ii) which
is not otherwise publicly known (other than by reason of an unauthorized act by
the Executive) and is subject to efforts that are reasonable under the
circumstances to maintain its secrecy. After termination of the Executive's
employment with the Company, the Executive shall not, without the prior written
consent of the Company, unless compelled pursuant to an order of a court or
other body having jurisdiction over such matter, communicate or divulge any
such information, knowledge or data to anyone other than the Company and those
designated by it.
(b) Upon termination of the Executive's employment for
any reason, the Executive, for the twelve (12) month period following the
Notice of Termination, shall not, on his own behalf or on behalf of any person
or entity, directly or indirectly solicit or aid in the solicitation of any
employees of the Company to leave their employment. In the event the Executive
violates the terms of Section 7(a) or this Section 7(b), the Employee shall
forfeit the right to all salary and benefits that the Executive and/or his
family members were otherwise entitled pursuant to the terms of Section 3.
Also, in the event that this Section 7 is determined to be unenforceable in
part, it shall be construed to be enforceable to the maximum extent permitted
by law.
(c) The Executive agrees that the covenants of
confidentiality and non-solicitation contained in this Section 7 are reasonable
covenants under the circumstances and necessary to protect the business
interests and properties of the Company. The Executive agrees that irreparable
loss and damage will be suffered by the Company should the Executive breach any
of the covenants contained in this Section 7. Accordingly, the Executive agrees
that the Company, in addition to all remedies provided at law or in equity,
shall be entitled to a temporary restraining order and temporary and permanent
injunctions to prevent a breach or contemplated breach of any of the covenants
contained in this Section 7.
8. Successors.
(a) This Agreement is personal to the Executive and,
without the prior written consent of the Company, shall not be assignable by
the Executive otherwise than by will or the laws of descent and distribution.
This Agreement shall inure to the benefit of and be enforceable by the
Executive's legal representatives.
(b) This Agreement shall inure to the benefit of and be
binding upon the Company and its successors. The Company shall require any
successor to all or substantially all of the business and/or assets of the
Company, whether direct or indirect, by purchase, merger, consolidation,
acquisition of stock, or otherwise, expressly to assume and agree to perform
this Agreement in the same manner and to the same extent as the Company would
be required to perform if no such succession had taken place.
9. Miscellaneous.
(a) Applicable Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of Tennessee, applied
without reference to principles of conflict of laws.
(b) Amendments. This Agreement may not be amended or
modified otherwise than by a written agreement executed by the parties hereto
or their respective successors and legal representatives.
(c) Notices. All notices and other communications
hereunder shall be in writing and shall be given by hand delivery to the other
party, by overnight delivery or by registered or certified mail, return receipt
requested, postage prepaid, addressed as follows:
If to the Executive: at the address listed on the last page hereof
If to the Company: Goody's Family Clothing, Inc.
000 Xxxxx'x Xxxx
X.X. Xxx 00000
Xxxxxxxxx, Xxxxxxxxx 00000-0000
Attention: General Counsel
(with a copy to the attention of the Secretary or to such other address as
either party shall have furnished to the other in writing in accordance
herewith). Communications delivered by hand or by overnight delivery shall be
deemed received on the date of delivery and communications sent by registered
or certified mail shall be deemed received three (3) business days after the
sending thereof.
(d) Tax Withholding. The Company may withhold from any
amounts payable under this Agreement such federal, state or local taxes as
shall be required to be withheld pursuant to any applicable law or regulation.
(e) Severability. The invalidity or unenforceability of
any provision of this Agreement shall not affect the validity or enforceability
of any other provision of this Agreement.
(f) Captions. The captions of this Agreement are not
part of the provisions hereof and shall have no force or effect.
(g) Entire Agreement. This Agreement expresses the
entire understanding and agreement of the parties regarding the terms and
conditions governing the Executive's employment with the Company, and all prior
agreements governing the Executive's employment with the Company shall have no
further effect; provided, however, that except as specifically provided herein,
the terms of this Agreement do not supersede the terms of any grant or award to
the Executive under any stock option or profit sharing program of the Company.
IN WITNESS WHEREOF, the Executive has hereunto set his hand and the
Company has caused this Agreement to be executed in its name on its behalf, and
its corporate seal to be hereunto affixed and attested by its Secretary, all
effective as of the day and year first above written.
GOODY'S FAMILY CLOTHING, INC.
By:
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Xxxxxx X. Xxxxxxxxxx
Title: Chairman and Chief Executive Officer
ATTEST:
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Title:
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(CORPORATE SEAL)
EXECUTIVE: Xxxxxxx X. Xxxxxx, Xx.
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Name: Xxxxxxx X. Xxxxxx, Xx.
Address:
