1
Exhibit 10.15
AMENDMENT TO EMPLOYMENT AGREEMENT
THIS AMENDMENT amends the Employment Agreement made the 11th day of
March, 1993 by and between DRUG EMPORIUM, INC., a Delaware Corporation having
its principal executive offices at 000 Xxxxxx Xxxxxxx Xxxxx, Xxxxxx, Xxxx 00000
(the "Company"), and XXXXX X. XXXXXXX, an individual residing at 0000 Xxxxxx
Xxxxx, Xxxx, Xxxx ("Xxxxxxx"), and is entered into this 2nd day of December,
1997. This Amendment replaces the amendment signed on September 25, 1996.
WHEREAS Xxxxxxx is employed as Chairman and Chief Executive Officer of
Company, and has served in that capacity since December 1, 1992; and
WHEREAS the Company is approached from time to time by outside
individuals and others who have an interest in acquiring all or a portion of the
Company's stock, some of whom have a background indicating the capability of
operating the Company, and some of whom do not; and
WHEREAS the Company desires to evaluate such individuals, companies and
potential offers in the best interests of its shareholders, without the
distraction of the effect of a change in control on its Chief Executive Officer;
and
WHEREAS the Company also wants to assure managerial continuity and
stability during any takeover attempt.
NOW, THEREFORE, in consideration of the foregoing and of the agreements
and covenants herein contained, Company and Xxxxxxx agree that the Employment
Agreement between them dated March 11, 1993, be amended as follows:
1. The Company agrees that if:
a. There is a change in control of the Company as
defined herein; and
x. Xxxxxxx leaves the employment of the Company for any
reason, other than discharge for cause as defined in
the Employment Agreement between Xxxxxxx and Company,
within one year after such change in control; then
(1) Xxxxxxx shall receive, in a lump sum, a cash
payment in the amount of the total of the
salary and bonus received by Xxxxxxx from
the Company in the last three full fiscal
years prior to the date of the change in
control;
(2) Xxxxxxx shall continue to receive all
employment benefits, including medical
benefits, health insurance and other, to
which he may be entitled as a member of
senior management of the Company for a
period of 36 months after the date of
termination;
1
2
(3) Xxxxxxx shall receive an additional
retirement benefit, over and above that to
which he would normally be entitled under
the Company's retirement plans, equal to the
actuarial equivalent of the additional
amount Xxxxxxx would have earned under such
retirement plans or programs had he
accumulated three additional continuous
years of service. Such amount shall be paid
to Xxxxxxx in a cash lump sum payment at his
normal retirement age, or, at Xxxxxxx'x
option, at his early retirement age as
provided for in such retirement plan.
Notwithstanding the provisions of subparagraphs (1),
(2) and (3) above, the aggregate present value of the
payments in the nature of compensation Xxxxxxx shall
receive hereunder shall not exceed an amount
determined by multiplying three (3) times the
aggregate present value of Xxxxxxx'x base amount
calculated in accordance with Internal Revenue Code
Section 280G by ninety-nine percent (99%).
2. The amounts paid to Xxxxxxx hereunder shall be considered
severance pay in consideration of the past services he has rendered to the
Company and in consideration of his continued service from the date hereof to
his entitlement to those payments. Xxxxxxx shall have no duty to mitigate his
damages by seeking other employment. Should Xxxxxxx actually receive payments
from any other employment, the payments called for hereunder shall not be
reduced or offset by any such payments.
3. The Company will reimburse Xxxxxxx for all legal fees and
expenses incurred in good faith by Xxxxxxx as a result of any dispute with any
party (including, but not limited to, the Company and/or an affiliate of the
Company) regarding the payment of any benefit provided for in Xxxxxxx'x
Employment Agreement as amended (including, but not limited to, all fees and
expenses incurred in disputing any termination or in seeking in good faith to
obtain or enforce any benefit or right provided by Xxxxxxx'x Employment
Agreement as amended or in connection with any tax audit or proceeding to the
extent attributable to the application of Section 4999 of the Code plus in each
case interest on any delayed payment at the applicable federal rate provided for
in Section 7872(f)(2)(A) of the Code. Such payments will be made within five
business days after delivery of Xxxxxxx'x written requests for payment
accompanied by any evidence of fees and expenses incurred as the Company may
reasonably require.
4. As used herein, the term "change in control" shall mean
either:
a. The ownership (whether direct or indirect) of shares
in excess of 50% of the outstanding shares of common
stock of the Company by a person or group of persons
not directors of the Company as of the date of this
agreement; or
2
3
b. The occurrence of both of the following:
(1) The ownership (whether direct or indirect)
of shares in excess of 20% of the
outstanding shares of common stock of the
Company by a person or group of persons not
directors of the Company as of the date of
this Amendment; and
(2) Any change in the composition of the Board
of Directors of the Company resulting in a
majority of the directors of the Company, as
of the date of this Amendment, no longer
constituting a majority; provided, however,
that in making such determination, directors
who were elected by, and on the
recommendation of, such present majority
shall be treated as present directors.
5. The arrangements called for by this Amendment are not intended
to have any effect on Xxxxxxx'x participation in any other benefits available to
executive personnel or to preclude other compensation or additional benefits as
may be authorized by the Company or its board from time to time.
6. This Amendment shall be binding and shall inure to the benefit
of the respective successors, assigns, legal representatives and heirs to the
parties hereto.
7. This Amendment shall terminate if, prior to any change in
control as defined herein, Xxxxxxx shall voluntarily resign, retire, become
permanently and totally disabled, or voluntarily take another position requiring
a substantial portion of his time. This Amendment shall also terminate if
Xxxxxxx'x employment as Chairman and Chief Executive Officer of the Company
shall have been terminated for any reason by the board of directors of the
Company for any reason prior to a change in control as defined herein.
DRUG EMPORIUM, INC.
By order of the Board of Directors
By:
-------------------------------- --------------------------------
Xxxxx X. Xxxxxxx
Its: Compensation Committee Chairman
3
