Exhibit 10.10
EMPLOYMENT AGREEMENT
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This Employment Agreement is made this 15th day of January, 1998, effective
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January 1, 1998, between Xxxxx Xxxxx, Inc., a Delaware corporation ("Xxxxx
Xxxxx") and Xxxxxxx X. Xxxxxx, of Mercer Island, Washington ("Xxxxxx").
Xxxxx Xxxxx and Xxxxxx hereby agree as follows:
1. EMPLOYMENT
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Xxxxx Xxxxx agrees to continue to employ Xxxxxx in the greater Seattle
metropolitan area until the effective date of the termination of the
employment period, as hereinafter provided, and Xxxxxx agrees to continue
such employment. Xxxxxx will serve as President and Chief Executive
Officer (CEO) of Xxxxx Xxxxx, reporting to the Board of Directors of Xxxxx
Xxxxx or its designee. Xxxxxx will have managerial responsibility for
Xxxxx Xxxxx and its assigned activities. Notwithstanding anything herein to
the contrary, there are certain transactions, a list of which has been
provided to Xxxxxx, that require the approval of the Board of Directors of
Xxxxx Xxxxx. For purposes of this contract the Office of the President of
Spiegel, Inc. shall be the designee of the Board of Directors of Xxxxx
Xxxxx.
2. BEST EFFORTS
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During the employment period, Xxxxxx will devote his best efforts and all
his business time and attention to the business of Xxxxx Xxxxx and will
faithfully perform his duties subject to the direction of the Board of
Directors or its designee and generally subject to the employment policies
of Xxxxx Xxxxx as may be promulgated from time to time by Xxxxx Xxxxx.
3. TERM OF EMPLOYMENT
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The term of this Employment Agreement shall be a period of five (5) years
(Initial Term) commencing January 1, 1998, and terminating December 31,
2002, subject, however, to prior termination as herinafter provided Section
9 (Termination for Cause) below. This Employment Agreement shall be
automatically renewed and continue in full force and effect for additional
consecutive three (3) year periods (Extended Term(s)) commencing the next
January 1, following the expiration of the then current
term, and terminating the third December 31, following the start of the
then new term, unless either party gives the other party three (3) month's
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written notice of its or his election to terminate this Employment
Agreement. If Xxxxx Xxxxx elects to terminate this Employment Agreement
by giving Xxxxxx three (3) months written notice of termination at the
expiration of the Initial Term or any Extended Term except if the date
of termination is after Xxxxxx has reached the age of 62, Xxxxx Xxxxx
agrees to pay Xxxxxx in a lump sum his entire compensation and benefits
package in place at the time of termination, as indicated on Schedule A
calculated for a period of twenty-four (24) months.
4. COMPENSATION
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Xxxxx Xxxxx shall pay Xxxxxx an annual base salary in accordance with
Schedule A payable in the ordinary course of business for like executives
of Xxxxx Xxxxx. The Board of Directors or its designee shall review this
base salary annually and shall have the right in its sole discretion to
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increase it at any time during the employment period. The increase in base
salary shall be evidenced by the Board of Directors or its designee
preparing an amended Schedule A to this Employment Agreement, which shall
give the amount of the increase in base salary, the new total base salary
and the period for which the increase shall be effective.
5. BONUS
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Xxxxx Xxxxx shall pay Xxxxxx an annual cash bonus no later than February
28th of each year based upon the performance of Xxxxx Xxxxx for the most
recently ended calendar year. The bonus will be in accordance with Schedule
A. The bonus opportunity shall be determined based upon performance
criteria mutually, and reasonably developed by Xxxxx Xxxxx or its designee
and Xxxxxx and agreed to by the Board of Directors with the understanding
that such criteria will provide a fair and professionally challenging
achievement rewarding good performance. The predetermined performanace
criteria, and any changes mutually agreed upon by Xxxxx Xxxxx or its
designee and Xxxxxx and agreed to by the Board of Directors, shall be
listed to this Employment Agreement to be known as Schedule B.
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6. BENEFITS
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Xxxxxx shall be eligible for all medical and dental benefits, disability
benefits, profit sharing, savings plans, and automobile allowance as
determined by the Board of Directors., paid vacation, paid up split dollar
life insurance, paid membership at the Bellevue Athletic Club and other
benefits which may be or currently are adopted by Xxxxx Xxxxx covering its
senior executive management staff, provided he meets the qualification
requirements for such benefits. Additional benefits may be added during the
term of this Agreement by Xxxxx Xxxxx.
7. INCAPACITY OF XXXXXX
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If, during the term of this Employment Agreement, Xxxxxx shall become
incapacitated by accident or illness and such incapacity shall continue for
a period of six (6) successive months, and he is unable to resume his
duties as provided herein, Xxxxx Xxxxx shall have the right to terminate
the employment period by giving written notice to Xxxxxx of its intention
to do so at least thirty (30) days prior to the effective date of such
termination; provided, however, Xxxxx Xxxxx agrees to maintain Xxxxxx'x
entire compensation and benefits package in place at that time for a period
of two (2) years commencing from the effective date of such termination.
8. DEATH OF XXXXXX
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If, during the term of this Employment Agreement, Xxxxxx should die, Xxxxx
Xxxxx agrees to maintain Xxxxxx'x entire compensation package in place as
of the date of his death as indicated on Schedule A for a period of one(1)
year from the date of his death. The compensation which is due Xxxxxx under
this paragraph shall be paid to the duly appointed Personal Representative
for the estate of Xxxxxx.
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9. TERMINATION FOR CAUSE
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Xxxxx Xxxxx may terminate the employment period for the following reasons:
repetitive intoxication, illegal or abusive use of drugs, illegal conduct,
or theft which significantly affect the ability of Xxxxxx to lead Xxxxx
Xxxxx or significantly damages Xxxxx Xxxxx'x public image. If any of the
above-identified reasons are present, Xxxxx Xxxxx shall have the right to
terminate the employment period by giving written notice to Xxxxxx of its
intention to do so at least thirty (30) days prior to the effective date of
such termination.
10. OTHER EMPLOYMENT
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Xxxxxx covenants and agrees that during the employment period, he will not
directly (except with the written consent of Xxxxx Xxxxx) become engaged
in, be employed by, render services to or for, or permit his name to be
used in connection with any business other than the business of Xxxxx
Xxxxx, whether such other business is or is not competitive with that of
Xxxxx Xxxxx.
11. TRADE SECRETS
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Xxxxxx shall not at any time while this Employment Agreement is in force,
and for a period of one (1) year after its termination ,unless authorized
by Xxxxx Xxxxx, divulge or disclose to any person or corporation any
confidential or proprietary information relating to the business of Xxxxx
Xxxxx, such as prices of products, services or operational processes, the
disclosure of which may have a materially adverse financial impact on Xxxxx
Xxxxx. Any breach of this confidentiality clause would cancel any
compensation or benefits paid at time of termination.
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12. TOTAL AGREEMENT
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This contract contains the complete agreement concerning the employment
arrangement between the parties and, as of the effective date, Supersedes
all other agreements, whether oral or in writing, between the parties.
13. GENERAL
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The headings of all the sections are inserted for convenience of reference
only and will not affect the construction or interpretation of this
agreement.
14. COVERING LAW
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This agreement shall be governed by the laws of the state of Illinois.
IN WITNESS WHEREOF, the parties have executed this Agreement as of this 15th
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day of, January, 1998.
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XXXXX XXXXX, 1NC.
/s/ Xxxxxxx X. Xxxxx /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxx Xxxxxxx X. Xxxxxx
Director
SPIEGEL, INC.
/s/ Xxxxxx X. Xxxxxxxxxx
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Xxxxxx X. Xxxxxxxxxx
Chairman, Office of the President
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EMPLOYMENT AGREEMENT
SCHEDULE A
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This Schedule A is made a part of the Employment Agreement between Xxxxx Xxxxx,
Inc. and Xxxxxxx X. Xxxxxx dated January 15, 1998.
COMPENSATION
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Year Base Salary Bonus Opportunity Guaranteed Bonus
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1998 $ 750,000 90% of base salary 45% of base salary
1999 $ 850,000 95% of base salary 47.5% of base salary
2000 $1,000,000 100% of base salary 50% of base salary
2001 $1,000,000 100% of base salary 50% of base salary
2002 $1,000,000 100% of base salary 50% of base salary
/s/ Xxxxxxx X. Xxxxx /s/ Xxxxxxx X. Xxxxxx
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Xxxxx Xxxxx Xxxxxxx X. Xxxxxx
EMPLOYMENT AGREEMENT
SCHEDULE B
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This Schedule B is made part of the Employment Agreement between Xxxxx Xxxxx,
Inc. and Xxxxxxx X. Xxxxxx dated January 15, 1998.
Bonus is determined by the Executive Committee and the Board of Directors each
year. Historically the criteria has been a pre-tax profit range stating the
amount of pre-tax profit that Xxxxx Xxxxx has to reach.
For year 1998 the pre-tax profit range is as follows:
50% of Bonus Opportunity at an EBT of $100 million
100% of Bonus Opportunity at an EBT of $116 million
150% of Bonus Opportunity at an EBT of $136 million
/s/ Xxxxxxx X. Xxxxx /s/ Xxxxxxx X. Xxxxxx
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Xxxxx Xxxxx Xxxxxxx X. Xxxxxx
EMPLOYMENT AGREEMENT
SCHEDULE B
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This Schedule B is made part of the Employment Agreement between Xxxxx
Xxxxx, Inc. and Xxxxxxx X. Xxxxxx dated January 15, 1998.
Bonus is determined by the Compensation Committee and the Board of Directors
each year. Historically the criteria has been a pre-tax profit range stating
the amount of pre-tax profit that Xxxxx Xxxxx has to reach.
For the year 1999, the pre-tax profit range is as follows:
50% of Bonus Opportunity at an EBT of $60 million
100% of Bonus Opportunity at an EBT of $90 million
150% of Bonus Opportunity at an EBT of $120 million
/s/ Xxxxxxx X. Xxxxx /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxx Xxxxxxx X. Xxxxxx
Xxxxx Xxxxx, Inc.
Effective: January 1, 1999.
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