EXHIBIT 10.19 - FORM OF CHANGE OF CONTROL SEVERANCE AGREEMENT
CHANGE OF CONTROL SEVERANCE AGREEMENT
AGREEMENT by and between SHOPKO STORES, INC., a Wisconsin corporation
(the "Company"), and _______________________________ (the "Executive"), on this
_____________________________.
The Company, on behalf of itself and its shareholders, wishes to assure
that the Company will have the continued dedication of the Executive,
notwithstanding the possibility, threat, or occurrence of a Change of Control
(as defined below). The Board of Directors of the Company (the "Board") believes
it is imperative to diminish the inevitable distraction of the Executive by
virtue of the personal uncertainties and risks created by a pending or
threatened Change of Control, to encourage the Executive's full attention and
dedication to the Company currently and in the event of any threatened or
pending Change of Control, and to provide the Executive with compensation
arrangements upon a Change of Control which provide the Executive with
individual financial security and which are competitive with those of other
corporations and, in order to accomplish these objectives, the Board has caused
the Company to enter into this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. CERTAIN DEFINITIONS.
(a) The "Effective Date" shall be the first date during the "Change of
Control Period" (as defined in Section 1(b)) on which a Change of
Control occurs. Anything in this Agreement to the contrary
notwithstanding, if the Executive's employment with the Company is
terminated by the Company prior to the date on which a Change of
Control occurs, and the Executive can reasonably demonstrate that such
termination (i) was at the request of a third party who has taken steps
reasonably calculated to effect a Change of Control, or (ii) otherwise
arose in connection with or in anticipation of a Change of Control
then for all purposes of this Agreement the "Effective Date" shall mean
the date immediately prior to the date of such termination.
The "Change of Control Period" is the period commencing on the
date hereof and ending on the earlier to occur of (i) the third
anniversary of such date or (ii) the first day of the month next
following the Executive's voluntary retirement under the Company's
retirement plan or policy ("Retirement"); provided however that
commencing on the date one year after the date hereof, and on each
annual anniversary of such date (such date and each annual anniversary
thereof are hereinafter referred to as the "Renewal Dates"), the Change
of Control Period shall be automatically extended so as to terminate on
the earlier of (x) two years from such Renewal Date or (y) the first
day of the month coinciding with or next following the Executive's
Retirement, unless at least 60 days prior to the Renewal Date the
Company shall give notice that the Change of Control Period shall not
be so extended.
2. CHANGE OF CONTROL. FOR THE PURPOSE OF THIS AGREEMENT, A "CHANGE OF CONTROL"
SHALL MEAN ANY OF THE FOLLOWING EVENTS:
(a) the acquisition by an individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act") (a "Person") of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 20% or more of either (i) the then outstanding shares
of common stock of the Company (the "Outstanding Company Common Stock")
or (ii) the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting Securities"); provided,
however, that for purposes of this subsection (a), the following
acquisitions shall not constitute a Change of Control: (i) any
acquisition directly from the Company, (ii) any acquisition by the
Company, (iii) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Company or any corporation
controlled by the Company, (iv) any acquisition by any corporation
pursuant to a transaction which complies with clauses (i) and (ii) of
subsection (c) of this Section 2 or (v) any acquisition of 20% or more
but less than a majority of either the Outstanding Company Common Stock
or the Outstanding Company Voting Securities by any
individual, entity or group if at least a majority of the members of
the Board were members of the Incumbent Board, as defined below, at the
time of such acquisition; or
(b) individuals who, as of the date hereof, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a
majority of the Board; provided, however, that any individual becoming
a director subsequent to the date hereof whose election, or nomination
for election by the Company's shareholders, was approved by a vote of
at least a majority of the directors then constituting the Incumbent
Board shall be considered as though such individual were a member of
the Incumbent Board, but excluding, for this purpose, any such
individual whose initial assumption of office occurs as a result of an
actual or threatened election contest with respect to the election or
removal of directors or other actual or threatened solicitation of
proxies or consents by or on behalf of a person other than the Board;
or
(c) consummation of a reorganization, merger or consolidation or sale
or other disposition of all or substantially all of the assets of the
Company for which approval of the shareholders of the Company is
required (a "Business Combination"), in each case, unless, immediately
following such Business Combination, (i) all or substantially all of
the individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Stock and Outstanding
Company Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more than 50% of,
respectively, the then outstanding shares of common stock and the
combined voting power of the then outstanding voting securities
entitled to vote generally in the election of directors, as the case
may be, of the corporation resulting from such Business Combination
(including, without limitation, a corporation which as a result of such
transaction owns the Company or all or substantially all of the
Company's assets either directly or through one or more subsidiaries)
in substantially the same proportions as their ownership, immediately
prior to such Business Combination of the Outstanding Company Common
Stock and Outstanding Company Voting Securities, as the case may be and
(ii) at least a majority of the members of the Board of Directors of
the corporation resulting from such Business Combination were members
of the Incumbent Board at the time of the execution of the initial
agreement, or of the action of the Board, providing for such Business
Combination; or
(d) approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company.
3. Agreement Period. The Company hereby agrees to provide to the Executive the
benefits and protections described herein, in consideration of the services
provided to the Company by the Executive after the date of this Agreement and of
the agreements of the Executive herein, for the period commencing on the
Effective Date and ending on the earlier to occur of (a) the second anniversary
of such date or (b) the first day of the month coinciding with or next following
the Executive's Retirement (the "Agreement Period").
4. Terms of Employment.
(a) Position and Duties.
(i) During the Agreement Period, (A) the Executive's position
(including status, offices, titles and reporting
requirements), authority, duties and responsibilities shall be
at least commensurate in all material respects with the most
significant of those held, exercised and assigned at any time
during the 90 day period immediately preceding the Effective
Date and (B) except when traveling in the normal course of
business, the Executive's services shall be performed at the
location where the Executive was employed immediately
preceding the Effective Date or any office or location less
than thirty-five (35) miles from such location.
(ii) During the Agreement Period, and excluding any periods of
vacation and sick leave to which the Executive is entitled,
the Executive agrees to devote reasonable attention and time
during normal business hours to the business and affairs of
the Company and, to the extent necessary to discharge the
responsibilities assigned to the Executive hereunder, to use
the Executive's reasonable best efforts to perform faithfully
and efficiently such responsibilities. During the Agreement
Period it shall not be a violation of this Agreement for the
Executive to (A) serve on corporate, civic or charitable
boards or committees, (B) deliver lectures, fulfill speaking
engagements or teach at educational institutions and (C)
manage personal investments, so long as such activities do not
significantly interfere with the performance of the
Executive's responsibilities as an
employee of the Company in accordance with this Agreement. It
is expressly understood and agreed that to the extent that any
such activities have been conducted by the Executive prior to
the Effective Date, the continued conduct of such activities
(or the conduct of activities similar in nature and scope
thereto) subsequent to the Effective Date shall not thereafter
be deemed to interfere with the performance of the Executive's
responsibilities to the Company.
(b) Compensation.
(i) Base Salary. During the Agreement Period, the Executive
shall receive a base salary ("Base Salary") at a monthly rate
at least equal to the highest monthly base salary paid to the
Executive by the Company during the twelve-month period
immediately preceding the month in which the Effective Date
occurs. During the Agreement Period, the Base Salary shall be
reviewed at least annually and shall be increased at any time
and from time to time as shall be consistent with increases in
base salary awarded in the ordinary course of business to
other key executives of the Company. Any increase in Base
Salary shall not serve to limit or reduce any other obligation
to the Executive under this Agreement. During the Agreement
Period, Base Salary shall not be reduced after any such
increase.
(ii) Annual Bonus. In addition to Base Salary, the Executive
shall be awarded, for each fiscal year during the Agreement
Period, an annual bonus (an "Annual Bonus") (either pursuant
to any Company bonus plan or otherwise) in cash determined by
a formula at least as advantageous to the Executive, taking
into account any changes in the capital structure and business
organization of the Company taking place after the Effective
Date (and any other significant changes in the fairness or
applicability of such formula), as the formula in use
immediately prior to the Effective Date.
(iii) Incentive Savings and Retirement Plans. In addition to
Base Salary and Annual Bonus payable as hereinabove provided,
the Executive shall be entitled to participate during the
Agreement Period in all incentive, savings and retirement
plans and programs applicable to other key executives of the
Company. Such plans and programs, in the aggregate, shall
provide the Executive with
compensation, benefits and reward opportunities at least as
favorable as the most favorable such compensation, benefits
and reward opportunities provided by the Company for the
Executive under such plans and programs as in effect at any
time during the 90-day period immediately preceding the
Effective Date or, if more favorable to the Executive, as
provided at any time thereafter with respect to other key
executives.
(iv) Welfare Benefit Plans. During the Agreement Period, the
Executive and/or the Executive's family, as the case may be,
shall be eligible for participation in and shall receive all
benefits under welfare benefit plans provided by the Company
(including, without limitation, medical, prescription, dental,
disability, salary continuance, executive life, group life,
accidental death and travel accident insurance plans and
programs), at least comparable to those in effect at any time
during the 90 day period immediately preceding the Effective
Date which would be most favorable to the Executive or, if
more favorable to the Executive, as in effect at any time
thereafter with respect to other key executives.
(v) Expenses. During the Agreement Period, the Executive shall
be entitled to receive prompt reimbursement for all reasonable
expenses incurred by the Executive in accordance with the most
favorable policies and procedures of the Company in effect at
any time during the 90 day period immediately preceding the
Effective Date or, if more favorable to the Executive, as in
effect at any time thereafter with respect to other key
executives.
(vi) Fringe Benefits. During the Agreement Period, the
Executive shall be entitled to fringe benefits, including use
of an automobile and payment of related expenses, in
accordance with the most favorable policies of the Company in
effect at any time during the 90 day period immediately
preceding the Effective Date or, if more favorable to the
Executive, as in effect at any time thereafter with respect to
other key executives.
(vii) Office and Support Staff. During the Agreement Period,
the Executive shall be entitled to an office or offices of a
size and with furnishings and other appointments, and to
secretarial and other assistance, at least equal to those
provided to the Executive at any time during the 90-day period
immediately preceding the Effective Date which would be most
favorable to the Executive or, if more favorable to the
Executive, as provided at any time thereafter with respect to
other key executives.
(viii) Vacation. During the Agreement Period, the Executive
shall be entitled to paid vacation in accordance with the most
favorable policies of the Company as in effect at any time
during the 90 day period immediately preceding the Effective
Date or, if more favorable to the Executive, as in effect at
any time thereafter with respect to other key executives.
5. Termination. Prior to the Effective Date, the Employee's employment with the
Company may be terminated at any time by either the Company or the Employee in
accordance with any other applicable policy or agreement of the Company and the
Employee. During the Agreement Period, the following provisions shall apply:
(a) Death or Disability. This Agreement shall terminate automatically
upon the Executive's death. The Company may terminate this Agreement,
after having established the Executive's Disability (pursuant to the
definition of "Disability" set forth below), by giving to the Executive
written notice of its intention to terminate the Executive's
employment. In such a case, the Executive's employment with the Company
shall terminate effective on the 30th day after receipt of such notice
(the "Disability Effective Date"), provided that, within the 30 days
after such receipt, the Executive shall not have returned to full-time
performance of the Executive's duties. For purposes of this Agreement,
"Disability" means disability which, at least 26 weeks after its
commencement, is determined to be total and permanent by a physician
selected by the Company or its insurers and acceptable to the Executive
or the Executive's legal representative (such agreement as to
acceptability not to be withheld unreasonably).
(b) Cause. The Company may terminate the Executive's employment for
"Cause." For purposes of this Agreement, "Cause" means (i) an act or
acts of personal dishonesty taken by the Executive and intended to
result in substantial personal enrichment of the Executive at the
expense of the Company, (ii) repeated violations by the Executive of
the Executive's obligations under Section 4(a) of this Agreement which
are demonstrably
willful and deliberate on the Executive's part and which are not
remedied after receipt of notice from the Company or (iii) the
conviction of the Executive of a felony.
(c) Good Reason. The Executive's employment may be terminated by the
Executive for Good Reason. For purposes of this Agreement, "Good
Reason" means:
(i) the assignment to the Executive of any duties inconsistent
in any respect with the Executive's position (including
status, offices, titles and reporting requirements),
authority, duties or responsibilities as contemplated by
Section 4(a) of this Agreement, or any other action by the
Company which results in a diminution in such position,
authority, duties or responsibilities, excluding for this
purpose an isolated, insubstantial and inadvertent action not
taken in bad faith and which is remedied by the Company
promptly after receipt of notice thereof given by the
Executive;
(ii) any failure by the Company to comply with any of the
provisions of Section 4(b) of this Agreement, other than an
isolated, insubstantial and inadvertent failure not occurring
in bad faith and which is remedied by the Company promptly
after receipt of notice thereof given by the Executive;
(iii) the Company's requiring the Executive to be based at any
office or location other than that described in Section
4(a)(i)(B) hereof, except for travel reasonably required in
the performance of the Executive's responsibilities;
(iv) any purported termination by the Company of the
Executive's employment otherwise than as permitted by this
Agreement; or
(v) any failure by the Company to comply with and satisfy
Section 13(c) of this Agreement.
For purposes of this Section 5(c), any good faith
determination of "Good Reason" made by the Executive shall be
conclusive.
(d) Notice of Termination. Any termination by the Company for Cause or
by the Executive for Good Reason shall be communicated by Notice of
Termination to the other
party hereto given in accordance with Section 14(b) of this Agreement.
For purposes of this Agreement, a notice of Termination" means a
written notice 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 under the provision so indicated 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 fifteen (15) days after the giving of such notice).
(e) Date of Termination. "Date of Termination" means the date of
receipt of the Notice of Termination or any later date specified
therein, as the case may be. If the Executive's employment is
terminated by the Company other than for Cause or Disability, the Date
of Termination shall be the date on which the Company notifies the
Executive of such termination. If the Executive's employment is
terminated by reason of death or Disability, the Date of Termination
shall be the date of death of the Executive or the Disability Effective
Date, as the case may be.
6. Obligations of the Company upon Termination.
(a) Death. If, during the Agreement Period, the Executive's employment
is terminated by reason of the Executive's death, this Agreement shall
terminate without further obligations to the Executive's legal
representatives under this Agreement, other than those obligations
accrued or earned by the Executive hereunder as of the Date of
Termination, including, for this purpose (i) the Executive's full Base
Salary through the Date of Termination at the rate in effect on the
Date of Termination or, if higher, at the highest rate in effect at any
time from the 90 day period preceding the Effective Date through the
Date of Termination (the "Highest Base Salary"), (ii) any accrued
vacation pay not yet paid by the Company and (iii) any other amounts or
benefits owing to the Executive under the then applicable employee
benefit plans or policies of the Company (such amounts specified in
clauses (i), (ii) and (iii) are herein after referred to as "Accrued
Obligations"). The Company shall pay the amounts specified in clauses
(i) and (ii) promptly after the Date of Termination (and in no case
later than 30 days after the Date of Termination) and shall pay the
amounts in clause (iii) promptly when due. Anything in this Agreement
to the contrary notwithstanding, after the Effective Date, the
Executive's family shall be entitled to
receive benefits at least equal to the most favorable benefits provided
by the Company to surviving families of executives of the Company under
such plans, programs and policies relating to family death benefits, if
any, as in effect at any time during the 90-day period immediately
preceding the Effective Date or, if more favorable to the Executive
and/or the Executive's family, as in effect on the date of the
Executive's death with respect to other key executives and their
families.
(b) Disability. If, during the Agreement Period, the Executive's
employment is terminated by reason of the Executive's Disability, this
Agreement shall terminate without further obligations to the Executive,
other than those obligations accrued or earned by the Executive
hereunder as of the Date of Termination, including for this purpose,
all Accrued Obligations. Anything in this Agreement to the contrary
notwithstanding, after the Effective Date, the Executive shall be
entitled after the Disability Effective Date to receive disability and
other benefits at least equal to the most favorable of those provided
by the Company to disabled employees and/or their families in
accordance with such plans, programs and policies relating to
disability, if any, as in effect at any time during the 90 day period
immediately preceding the Effective Date or, if more favorable to the
Executive and/or the Executive's family, as in effect at any time
thereafter with respect to other key executives and their families.
(c) Cause: Other Than for Good Reason. If, during the Agreement Period,
the Executive's employment shall be terminated for Cause, this
Agreement shall terminate without further obligations to the Executive
other than the obligation to pay to the Executive the Highest Base
Salary through the Date of Termination plus any continuing obligations
related to any compensation previously deferred by the Executive. If
the Executive terminates employment other than for Good Reason, this
Agreement shall terminate without further obligations to the Executive,
other than those obligations accrued or earned by the Executive through
the Date of Termination, including for this purpose, all Accrued
Obligations.
(d) Good Reason: Other Than for Cause or Disability. If, during the
Agreement Period, the Company shall terminate the Executive's
employment other than for Cause or
Disability, or the employment of the Executive shall be terminated by
the Executive for Good Reason:
(i) the Company shall pay to the Executive in a lump sum in
cash within 30 days after the Date of Termination the
aggregate of the following amounts:
A. to the extent not therefore paid, the Executive's
Highest Base Salary through the Date of Termination;
and
B. ____ times the average of the Annual Bonuses
payable to the Executive in respect of the three
years preceding the fiscal year in which the
Effective Date occurs; and
C. ___ times the Highest Base Salary; and
D. all other amounts accrued or earned by the
Executive through the Date of Termination and amounts
otherwise owing under the then existing plans and
policies of the Company; and
(ii) for ____ years after the Date of Termination the Company
shall continue benefits to the Executive and/or the
Executive's family at least equal to those which would have
been provided to them in accordance with the health and dental
plans, programs and policies provided by the Company to
employees and/or their families if the Executive's employment
had not been terminated, including health insurance and dental
insurance, if and as in effect at any time during the 90-day
period immediately preceding the Effective Date or, if more
favorable to the Executive, as in effect at any time
thereafter with respect to other key executives and their
families; provided, however, that such benefit continuation
shall cease when and to the extent the Executive obtains
coverage through a new employer.
Notwithstanding the foregoing, the Company will not pay to Executive,
and Executive will not have any right to receive, any payments
described in subsections 6(d)(i)(B) and (C) unless and until Executive
or his legal representative (in the case of the Executive's death or if
Executive is disabled such that he is unable to consent) executes, and
there shall be effective following any statutory period for revocation,
a release that irrevocably
and unconditionally releases, waives, and fully and forever discharges
the Company, any company acquiring the Company or its assets, and their
past and current shareholders, directors, officers, employees, and
agents from and against any and all claims, liabilities, obligations,
covenants, rights, demands and damages of any nature whatsoever,
whether known or unknown, anticipated or unanticipated, relating to or
arising out of the Executive's employment with the Company or
termination thereof, including without limitation claims arising under
the Age Discrimination in Employment Act of 1977, as amended, Title VII
of the Civil Rights Act of 1974, as amended, the Civil Rights Act of
1991, as amended, the Equal Pay Act, as amended, and any other federal,
state, or local law or regulation, provided, however, that the release
shall provide that nothing contained therein shall adversely affect the
Executive's rights to receive benefits to which he is entitled under
any qualified or nonqualified employee benefit plans and arrangements
of the Company or this Agreement, or the Executive's rights to
indemnification as provided under applicable law, the Articles of
Incorporation or By-Laws of the Company or any written agreement
between the Executive and the Company or the Company and a third party.
7. 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 or any of its
affiliated companies and for which the Executive may qualify, nor shall anything
herein limit or otherwise affect such rights as the Executive may have under any
stock option or other agreements with the Company or any of its affiliated
companies. Amounts which are vested benefits or which the Executive is otherwise
entitled to receive under any plan or program of the Company or any of its
affiliated companies at or subsequent to the Date of Termination shall be
payable in accordance with such plan or program.
8. Full Settlement. The Company's obligation to make the payments provided for
in this Agreement and otherwise to perform its obligations hereunder shall not
be affected by any set-off, counterclaim, recoupment, defense or other claim,
right or action which the Company may have against the Executive or others. In
no event shall the Executive be obligated to seek other employment or take any
other action by way of mitigation of the amounts payable to the Executive under
any of the provisions of this Agreement. The Company shall pay all legal fees
and related expenses (including the costs of experts, evidence and counsel)
reasonably incurred by the
Executive as they become due as a result of the Executive's seeking to obtain or
enforce any right or benefit provided by this Agreement or by any other plan or
arrangement maintained by the Company under which the Executive is or may be
entitled to receive benefits. If any legal proceeding is commenced by the
Company to enforce or interpret the terms of this Agreement, or to recover
damages for breach hereof, and if the Executive ultimately prevails in such
legal proceeding, the Executive shall be entitled to recover from the Company
all legal fees and related expenses (including the costs of experts, evidence
and counsel) reasonably incurred by the Executive, in addition to any other
relief to which he may be entitled, plus in each case interest at the applicable
Federal rate provided for in Section 7872(f)(2) of the Code.
9. Certain Reduction of Payments by the Company.
(a) Limitation of Payments. Notwithstanding anything contained herein
to the contrary, prior to the payment of any amounts pursuant to
Section 6(d) hereof, an independent national accounting firm designated
by the Company (the "Accounting Firm") shall compute whether there
would be any "excess parachute payments" payable to the Executive,
within the meaning of Section 280G of the Internal Revenue Code of
1986, as amended (the "Code"), taking into account the total "parachute
payments," within the meaning of Section 280G of the Code, payable to
the Executive by the Company or any successor thereto under this
Agreement and any other plan, agreement or otherwise. If there would be
any excess parachute payments, the Accounting Firm will compute the net
after-tax proceeds to the Executive, taking into account the excise tax
imposed by Section 4999 of the Code, if (i) the payments hereunder were
reduced, but not below zero, such that the total parachute payments
payable to the Executive would not exceed three (3) times the "base
amount" as defined in Section 280G of the Code, less One Dollar
($1.00), or (ii) the payments hereunder were not reduced. If reducing
the payments hereunder would result in a greater after-tax amount to
the Executive, such lesser amount shall be paid to the Executive. If
not reducing the payments hereunder would result in a greater after-tax
amount to the Executive, such payments shall not be reduced. The
determination by the Accounting Firm shall be binding upon the company
and the Executive subject to the application of Section 9(b) hereof.
(b) Treatment of Mistaken Payments. As a result of the uncertainty in
the application of Sections 280G of the Code, it is possible that
excess parachute payments will be paid when such payment would result
in a lesser after-tax amount to the Executive; this is not the intent
hereof. In such cases, the payment of any excess parachute payments
will be void ab initio as regards any such excess. Any excess will be
treated as a loan by the Company to the Executive. The Executive will
return the excess to the Company, within fifteen (15) business days of
any determination by the Accounting Firm that excess parachute payments
have been paid when not so intended, with interest at an annual rate
equal to the rate provided in Section 1274(d) of the Code (or 120% of
such rate if the Accounting Firm determines that such rate is necessary
to avoid an excise tax under Section 4999 of the Code) from the date
the Executive received the excess until it is repaid to the Company.
(c) Payment of Costs and Expenses. All fees, costs and expenses
(including, but not limited to, the cost of retaining experts) of the
Accounting Firm shall be borne by the Company and the Company shall pay
such fees, costs and expenses as they become due. In performing the
computations required hereunder, the Accounting Firm shall assume that
taxes will be paid for state and federal purposes at the highest
possible marginal tax rates which could be applicable to the Executive
in the year of receipt of the payments, unless the Executive agrees
otherwise.
10. Confidential Information. For the period of the Executive's employment with
the Company, the Executive shall hold in a fiduciary capacity for the benefit of
the Company all secret or confidential information, knowledge or data relating
to the Company or any of its affiliated companies, and their respective
businesses, which shall have been obtained by the Executive during the
Executive's employment by the Company or any of its affiliated companies and
which shall not be public knowledge (other than by acts by the Executive or his
representatives in violation of this Agreement). After termination of the
Executive's employment with the Company, the Executive shall not, without the
prior written consent of the Company, communicate or divulge any such
information, knowledge or data to anyone other than the Company and those
designated by it for the two years beginning with the date of his termination of
employment with the Company. Notwithstanding the foregoing, the Executive's
obligations hereunder regarding confidential information shall continue after
the end of the two-year period following his or her
termination of employment with the Company as regards any information which is a
trade secret as defined in Section 134.90 of the Wisconsin Statutes. In no event
shall an asserted violation of the provisions of this Section 10 constitute a
basis for deferring or withholding any amounts otherwise payable to the
Executive under this Agreement.
11. Exclusive Remedy. The payments, severance benefits and severance protections
provided to the Executive pursuant to this Agreement are to be paid and provided
in lieu of any severance payments, severance benefits and severance protections
provided in any other plan or policy of the Company, except as expressly
provided in writing under the terms of any plan or policy of the Company, or in
a written agreement between the Company and the Executive entered into after the
date of this Agreement.
12. Statement of Intention. It is the intention of the parties hereto that prior
to the Effective Date, this Agreement shall not create any rights or obligations
in the Executive or the Company, or require any payments by the Company to the
Executive, except as expressly provided herein.
13. 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.
(c) The Company will require any successor (whether direct or indirect,
by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to
expressly assume and agree to perform this Agreement in the same manner
and to the same extent that the Company would be required to perform it
if no such succession had taken place. As used in this Agreement,
"Company" shall mean the Company as hereinbefore defined and any
successor to its business and/or assets as aforesaid which assumes and
agrees to perform this Agreement by operation of law, or otherwise.
14. Miscellaneous.
(a) This Agreement shall be governed by and construed in accordance
with the laws of the State of Wisconsin, without reference to
principles of conflict of laws. The captions of this Agreement are not
part of the provisions hereof and shall have no force or effect. 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.
(b) All notices and other communications hereunder shall be in writing
and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed
as follows:
If to the Executive: His most recent address as it appears on the
-------------------- Company's payroll records
If to the Company: ShopKo Stores, Inc.
------------------ 000 Xxxxxxx Xxx
X.X. Xxx 00000
Xxxxx Xxx, XX 00000-0000
Attention: Secretary
or to such other address as either party shall have furnished to the
other in writing in accordance herewith. Notice and communications
shall be effective when actually received by the addressee.
(c) 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. Furthermore,
none of the payments under this subsections 6(d)(i)(B) and (C) shall be
included as compensation for purposes of any pension, deferred
compensation or welfare benefit plan or program of the Company.
(d) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
(e) The Executive's failure to insist upon strict compliance with any
provision hereof shall not be deemed to be a waiver of such provision
or any other provision thereof.
(f) This Agreement contains the entire understanding of the Company and
the Executive with respect to the subject matter hereof. It is
expressly agreed that this Agreement supersedes and replaces any other
form of Change of Control Severance Agreement which may have previously
been entered into between Company and Executive.
(g) The Executive and the Company acknowledge that the employment of
the Executive by the Company is "at will", and, prior to the Effective
Date, may be terminated by either the Executive or the Company at any
time. Upon a termination of the Executive's employment or upon the
Executive's ceasing to be an officer of the Company, in each case,
prior to the Effective Date, there shall be no further rights under
this Agreement.
IN WITNESS WHEREOF, the Executive has hereunto set his hand and,
pursuant to the authorization from its Board of Directors, the Company has
caused these presents to be executed in its name on its behalf, all as of the
day and year first above written.
SHOPKO STORES, INC.
By: ____________________________________
EXECUTIVE
________________________________
