SEVERANCE PAY, CONFIDENTIALITY, AND NON-SOLICITATION AGREEMENT
This Agreement ("Agreement") is made this 18 day of November, 1997, by and
between PAMIDA, INC. ("Employer"), a Delaware corporation, and XXXXXX X.
XXXXXXXXXXX ("Employee").
W I T N E S S E T H:
WHEREAS, Employee currently is employed by Employer as a senior executive;
and
WHEREAS, Employer and Employee wish to set forth in this Agreement the
terms and conditions of Employee's confidentiality and non-solicitation
obligations and Employee's right to severance pay in the event that Employee
leaves the Employer's employ under certain conditions;
NOW, THEREFORE, in consideration of the premises and of the covenants set
forth herein, the parties hereto, intending to be legally bound, agree as
follows:
1. EMPLOYMENT STATUS. On and after the date this Agreement is executed (the
"Effective Date"), Employee will continue his employment with Employer subject
to Employer's standard personnel policies, procedures, guidelines, and practices
as they may exist and be amended from time to time. In the event of a conflict
between the provisions of such policies, procedures, guidelines, and practices
and the provisions of this Agreement, the provisions of this Agreement shall
control. During the period of his employment by Employer, Employee shall
diligently and faithfully perform the duties from time to time assigned to him
by or on behalf of Employer.
2. AT-WILL STATUS. This Agreement is not, and shall not for any purpose be
deemed to constitute, an employment agreement between Employer and Employee.
Employee is and shall remain an employee at-will of Employer. Either Employee or
Employer may end the employment relationship between Employer and Employee at
any time, for any reason, with or without cause.
3. SEVERANCE PAYMENT. If Employer terminates the employment of Employee
without Cause, including but not limited to a constructive discharge arising
from a material reduction in duties or a material reduction in rank or base
salary, then Employee shall, upon such termination of employment, be entitled to
receive severance pay from Employer in an amount equal to Employee's annual base
salary at the effective time of such termination of employment; provided, that
the amount of such severance pay shall increase to twice Employee's annual base
salary at the effective time of such termination of employment in the event that
Xxxxxx X. Xxxxxxx is not the Chief Executive Officer of Employer at the
effective time of such termination of employment or ceases to be the Chief
Executive Officer of Employer within three (3) months after the effective time
of such termination of employment. Employer shall pay such severance pay to
Employee in bi-weekly payments over the applicable twelve (12) month or
twenty-four (24) month period following the effective time of such termination
of employment in accordance with Employer's normal payroll practices, less
applicable deductions and other amounts required by law to be withheld.
Notwithstanding the foregoing provisions of this Section 3, the amount of
severance pay which Employee is entitled to receive pursuant to this Section 3
shall be reduced by the total amount of any wages earned by Employee during the
applicable twelve (12) month or twenty-four (24) month period immediately
following the effective date of the termination of his employment by Employer;
in no event, however, shall Employee be required to repay to Employer any
portion of any severance payments to which Employee was entitled pursuant to
this Section 3 for any period prior to the period during which Employee earned
such wages. For purposes of this Section 3, "wages" shall mean and include both
wages for purposes of federal income tax withholding as defined in Section 3401
of the Internal Revenue Code of 1986 (the "Code") and net earnings from
self-employment as defined in Section 1402 of the Code. If Employer terminates
the employment of Employee for Cause, then Employee shall not be entitled to
receive any payments under this Section 3.
4. CAUSE. For purposes of this Agreement, "Cause" shall mean only (i)
Employee's confession or conviction of theft, fraud, embezzlement, or any other
crime involving dishonesty with respect to Employer or any parent, subsidiary,
or affiliate of Employer, (ii) Employee's excessive absenteeism (other than by
reason of physical injury, disease, or mental illness) without reasonable cause,
(iii) material violation by Employee of the provisions of Section 8, (iv)
habitual and material negligence by Employee in the performance of his duties
and responsibilities as an executive of Employer and failure to cure such
negligence within thirty (30) days after his receipt of a written notice from
Employer setting forth in reasonable detail the particulars of such negligence,
or (v) material failure by Employee to comply with a lawful directive of
Employer and failure to cure such non-compliance within thirty (30) days after
his receipt of a written notice from Employer setting forth in reasonable detail
the particulars of such non-compliance.
5. OTHER BENEFITS. In the event of the termination of Employee's employment
with Employer for any reason whatsoever, whether voluntarily or involuntary,
Employee will not be entitled to receive any further employee benefits at
Employer's expense; provided, that Employee shall be entitled to continue
certain health insurance benefits at his expense to the extent provided by the
Consolidated Omnibus Budget Reconciliation Act of 1986, as amended. The
severance benefits set forth in this Agreement are in lieu of any and all other
severance benefits that Employee might otherwise be entitled to receive as a
result of his employment with Employer.
6. NON-SOLICITATION. In further consideration of his employment by Employer
and the provisions of this Agreement, Employee agrees that for a period of one
(1) year after the termination of his employment with Employer for any reason
whatsoever, whether voluntarily or involuntary, Employee will not, directly or
indirectly, employ, solicit for employment, or advise or recommend to any other
person that such other person solicit for employment any person employed by
Employer during the three (3) months prior to the termination of Employee's
employment with Employer.
7. REPORT OF NEW EMPLOYMENT. During the twelve (12) month or twenty-four
(24) month period, as the case may be, in which Employee may be entitled to
receive severance pay pursuant to Section 3, Employee will advise Employer, in
writing, within five (5) days after the beginning of each calendar month, of his
employment status as of the beginning of such month, including (if applicable)
the name and address of any employer or other person or entity for which
Employee then is providing or expects to provide services as an employee or
independent contractor, and the compensation Employee is entitled to receive
from such employment. For purposes of this Section 7, employment shall include
self-employment and compensation shall include net earnings from
self-employment. Employer will rely on such report to adjust the severance
payments to which Employee may be entitled pursuant to Section 3 of this
Agreement.
8. CONFIDENTIALITY. To permit Employee to effectively function in his job
with Employer, Employer may, from time to time, entrust Employee with highly
sensitive, confidential, and proprietary information belonging to Employer,
including but not limited to information regarding Employer's business,
finances, future plans, trade secrets, know-how, products, and suppliers, which
Employer desires to protect. In order to protect the Confidential Information of
Employer, Employee shall treat all Confidential Information as confidential,
will not disclose Confidential Information to anyone except as directed by
management of Employer, and will use Confidential Information only for the
advancement of the interests of Employer. Employee agrees that upon termination
of his employment with Employer, for any reason whatsoever, voluntary or
involuntary, he will immediately return to Employer all equipment, property,
funds, lists, forms, plans, documents or other written or electronic material,
software or firmware, or copies of any of such items, within his possession
which belong to Employer, including but not limited to all materials containing
Confidential Information; and Employee will not retain or use any Confidential
Information for any purpose after the termination of his employment with
Employer.
"Confidential Information" means information, not generally known or
available to the public, that is proprietary to Employer, including without
limitation:
1) financial and accounting data, securities information, sales records,
profit and loss and other performance reports, personnel information,
benefit plans and programs, training manuals, financing methods, data
processing and communications information, technical data, trade
secrets, and know-how regarding Employer's business and its products
and services;
2) vendor and supplier information wherever located including, without
limitation, vendor and supplier lists, identities of foreign and
domestic manufacturers of goods, contact persons, relationship
information, costs of goods, production capabilities, quantity
requirements, availability, payment terms, and other requirements of
the vendor or supplier;
3) Employer's buying practices, sources of supply for goods, information
and materials used for production and assembly, the quality, prices
and usage of components, information and materials, manner of vendor
payment, profit margins, expense ratios, pricing, lead time and other
information concerning Employer's buying activities;
4) Employer's sales information, including but not limited to quantities
of products sold, pricing policies and practices, terms, timing of
sales, and current and anticipated requirements of customers generally
for products or services of Employer;
5) product design, advertising layout and marketing, including but not
limited to research, development, testing and customer surveys and
preferences regarding Employer's current and new products, and
specifications of any new products or services under development by or
for Employer; and
6) business projections, strategic planning, marketing planning, activity
and practices, marketing systems and procedures, inventory procedures
and systems, and other merchandise logistics.
9. SURVIVAL AND NOTICE. The provisions of Sections 6 and 8 shall survive
the termination of Employee's employment with Employer, regardless of the
circumstances of such termination and regardless of whether such termination is
voluntary or involuntary. Employee shall, for a period of one (1) year following
his termination of employment with Employer, inform any new employer, including
any person for whom Employee provides services as an independent contractor, of
the provisions of Sections 6 and 8 of this Agreement; but the termination of
such requirement after one (1) year shall not limit the continuing obligations
of Employee under Section 8 of this Agreement.
10. BINDING EFFECT; NO ASSIGNMENT. This Agreement shall be binding upon and
inure to the benefit of Employee, Employer, and their respective heirs, personal
representatives, successors, and assigns. The rights and benefits of Employee
under this Agreement are personal to him, and no such right or benefit may be
assigned or transferred by Employee to anyone else.
11. INJUNCTIVE RELIEF. If Employee shall violate or threaten to violate any
of the provisions of Section 6 or 8 of this Agreement, then Employer shall be
entitled to injunctive relief; such remedy shall be in addition to and not in
limitation of any rights or remedies to which Employer is or may be entitled at
law or in equity, including the forfeiture of any remaining entitlement to
severance payments pursuant to Section 3 of this Agreement.
12. PRIOR AGREEMENTS. This Agreement supersedes any prior agreement that
Employee has with Employer concerning confidentiality, non-solicitation of
employees, or severance pay, including but not limited to the Severance Pay,
Confidentiality, and Non-Solicitation Agreement between the Employer and the
Employee dated April 7, 1997.
13. GOVERNING LAW. This Agreement shall be subject to and construed under
the laws of the State of Nebraska.
14. ATTORNEY REVIEW. Employee confirms that he has been given the
opportunity by Employer to negotiate the terms of this Agreement and to
thoroughly discuss all aspects of this Agreement with his attorney. Employee has
carefully read and fully understands all of the provisions of this Agreement and
is voluntarily entering into this Agreement.
IN WITNESS WHEREOF, the parties have executed this agreement on the day and
year first above written.
PAMIDA, INC.
By:/s/ Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx, Chairman of the
Board and Chief Executive Officer
/s/ Xxxxxx X. Xxxxxxxxxxx
Xxxxxx X. Xxxxxxxxxxx, Employee
