Exhibit 10.21a
AMENDMENT TO EMPLOYMENT AGREEMENT
This Amendment To Employment Agreement (the "Amendment") is entered
into as of this 29th day of June, 1999 by and between The Penn Traffic Company
(the "Company") and Xxxxxx X. Xxxxxx ("Executive").
WHEREAS, the Executive has been employed by the Company as its
President and Chief Executive Officer pursuant to an Employment Agreement
entered into as of October 30, 1998 (the "Employment Agreement");
WHEREAS, the Company contemplates the reorganization of certain
outstanding indebtedness and liabilities of, and equity interests in, the
Company and certain of its subsidiaries through confirmation of a
"pre-negotiated" plan of reorganization for the Company (the "Plan") under
Chapter 11 of Title 11 of the United States Code, 11 X.X.X.xx. 101 et seq., (the
"Bankruptcy Code"); and
WHEREAS, as part of the Company's reorganization (i) its Board of
Directors (the "Board") will consist of nine members, six of whom will be
selected by the Company's senior and subordinated noteholders and the other
members will be Xxxxxx X. Xxx, Xxxx X. Xxxxxx and the Executive and (ii) an
Executive Committee of the Board, which will consist of Messrs. Xxxxxx and Fox
and the Executive, will be appointed to manage the business of the Company.
NOW, THEREFORE, in consideration of the premises and mutual covenants
and agreements set forth herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties agree
as follows:
1. The Executive shall continue to be employed as the President and
Chief Executive Officer of the Company during the Term (as defined in the
Employment Agreement). Further, as of the effective date of the Plan (the
"Effective Date"), the Executive hereby accepts his (i) election as a member of
the Board and (ii) appointment to the Board's Executive Committee, which shall
manage the business of the Company and have all authority customarily delegated
to the most senior executives of a company, subject to oversight by the entire
Board. Executive will report to, and serve under the direction of, (i) the
Chairman of the Executive Committee on all matters under the authority of the
Executive Committee and (ii) the Board on all other matters.
2. Paragraph 4(e) of the Employment Agreement shall be deleted in its
entirety and the following shall be substituted in its place: "Subject to the
terms of the
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Company's 1999 Equity Incentive Plan (the "Equity Plan"), Executive shall be
granted as of the Effective Date, fully-vested options, to purchase 280,000
shares of the Common Stock, $.01 par value per share (the "Common Stock"), of
the Company with an exercise price equal to $18.30 per share. Such options shall
be fully vested as of the Effective Date and generally must be exercised on or
before the tenth anniversary of the Effective Date. To the extent permitted by
the Internal Revenue code ("IRC"), such options will qualify as incentive stock
options under the IRC. Further, no later than one year after the Effective Date,
the Board's Compensation and Stock Option Committee (the "Committee") will
review the Executive's performance and based on his performance and the
Company's performance to date, the Committee shall consider and may, at its sole
discretion, grant additional options to the Executive."
3. Paragraph 14 of the Employment Agreement shall be revised only to
add that the Company shall obtain "tail" coverage under its existing director's
and officer's policy covering its current directors and officers for any claims
brought against them, which coverage shall extend for a period of not less than
six (6) years after the Effective Date. The price and terms of such coverage
shall be subject to the reasonable approval of the Informal Committee of holders
of the company's senior and subordinated notes.
4. The Executive hereby acknowledges that the Plan and the issuance of
shares of Common Stock or the reconstitution of the Company's Board of
Directors, in each case pursuant to the Plan shall not constitute a "change in
control" for purposes of the Employment Agreement and/or any employee benefit
plan, policy, arrangement, program or practice sponsored or maintained by the
Company.
5. Other than as amended herein, the Employment Agreement, subject to
Paragraph 6 hereof, shall continue in full force and effect. In the event of a
explicit conflict between the Employment Agreement and this Amendment, the
Amendment will govern.
6. This Amendment shall, subject to the prior approval of the
Bankruptcy Court in the District of Delaware, become effective upon the date
that the Bankruptcy Court in the District of Dealware declares the Plan to be
effective.
7. This Amendment may be executed in counterparts, each of which, when
so executed and delivered, shall be an original, but all of which together shall
constitute one document.
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IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first above written.
THE PENN TRAFFIC COMPANY
/s/ Xxxxxx X. Xxx /s/ Xxxxxx X. Xxxxxx
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By: Xxxxxx X. Xxx Xxxxxx X. Xxxxxx
Title: Vice Chairman--Finance
