Exhibit 10.6
EMPLOYMENT AGREEMENT
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This Employment Agreement is made as of December 15, 2000 between Spiegel
Catalog, Inc., a Delaware corporation ("Spiegel") and Xxxxxxx Xxxxxx-Xxxxxx, of
Oak Brook, Illinois ("Payner").
Spiegel and Payner hereby agree as follows:
1. EMPLOYMENT
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Spiegel Catalog agrees to employ Payner in the greater Chicago metropolitan
area until the effective date of the termination of the employment period,
as hereinafter provided, and Payner agrees to continue such employment.
Payner will serve faithfully and to the best of her ability as President
and Chief Executive Officer of Spiegel Catalog, reporting to the Board of
Directors of Spiegel or its designee. Payner will have managerial
responsibility for Spiegel Catalog and its assigned activities.
Notwithstanding anything herein to the contrary, there are certain
transactions, a list of which has been provided to Payner, that require the
approval of the Board of Directors of Spiegel. For purposes of this
contract, anywhere herein where a designee of the Board of Directors is
permissible, Spiegel hereby so designates the Office of the President of
Spiegel, Inc.
2. BEST EFFORTS
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During the employment period, Payner will devote her best efforts and all
her business time and attention to the business of Spiegel and will
faithfully perform her duties subject to the direction of the Board of
Directors or its designee and generally subject to the employment policies
of Spiegel as may be promulgated from time to time,
3. TERM OF EMPLOYMENT
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The term of this Employment Agreement shall be a period of three (3) years
(Initial Term) commencing December 15, 2000, and terminating December 31,
2003, subject, however, to
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prior termination as in after provided Section 8 (Termination for Cause)
below. This Employment Agreement shall be automatically renewed and
continue in full force and effect for additional one year terms without
limitation, unless either party gives the other party six (6) months'
written notice of its or her election to terminate this Employment
Agreement at the end of the then current calendar year. If Spiegel elects
to terminate this Employment Agreement in accordance with this Paragraph 3,
then Spiegel will pay Payner at time of termination an amount equal to
Payner's entire compensation and benefit package (including pro-rated
Annual and Long Term Incentives) then in effect as provided on Schedule A
and Schedule B and Paragraph 6 herein calculated for a period of
twenty-four (24) months but shall not exceed Three Million and 00/100
Dollars ($3,000,000.00). No payment under this paragraph shall be due if
termination is after Payner's 62nd birthday.
4. COMPENSATION
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Spiegel shall pay Payner an annual base salary in accordance with Schedule
A payable in the manner as is done in the ordinary course of business for
upper level executives of Spiegel. The Board of Directors or its designee
shall review this base salary annually and shall have the right to
increase it at any time during the employment period. An increase in base
salary shall be evidenced by the Board of Directors or its designee
approving 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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Payner shall be entitled to an annual cash bonus no later than February
28th of each year based upon the performance of Spiegel 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 Spiegel or its
designee and Payner 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
performance criteria, and any changes mutually agreed upon by Spiegel or
its
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designee and Payner and agreed to by the Board of Directors shall be as
set forth in Schedule B, attached to this Agreement.
6. BENEFITS
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Payner shall be eligible for all medical and dental benefits, disability
benefits, long term incentive plans, stock options, profit sharing,
savings plans, automobile allowance, paid vacation, paid-up split dollar
and whole life insurance policies then in effect, a membership at a
country club and other benefits which are or shall be adopted by Spiegel
covering its senior executive management staff, provided she meets the
qualification requirements for such benefits. Additional benefits may be
added during the term of this Agreement by Spiegel.
7. DISABILITY OF PAYNER
-----------------------
If, during the term of this Employment Agreement, Payner shall become
disabled by accident, illness, or otherwise, and such disability shall
continue for a period of six (6) successive months following which she is
unable to resume her duties hereunder, Spiegel shall have the right to
terminate the employment period by giving written notice to Payner of its
intention to do so at least thirty (30) days prior to the effective date
of such termination, provided, however, Spiegel agrees to pay a lump sum at
the time of termination in an amount equal to the fair value of her entire
compensation and benefits package in place at that time calculated for a
period of six (6) months commencing from the effective date of such
termination in lieu of continuing to provide such benefits in periodic
amounts. Any dispute as to whether such a disability has occurred shall be
resolved by a physician reasonably satisfactory to both parties, whose
determination shall be final and binding on both parties.
8. TERMINATION FOR CAUSE
------------------------
Spiegel may terminate the employment period for cause for the following
reasons other than innocent acts: repetitive and offensive public
intoxication, a felony conviction, the intentional perpetration of a
dishonest act or fraud against Spiegel or an affiliate or subsidiary
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thereof, which is significantly injurious in a material respect to the
financial condition, business or reputation of Spiegel or any of its
affiliates or subsidiaries. Spiegel shall have the right to terminate the
employment period for any above reason by giving written notice to Payner
of its intention to do so and specifying therein the reason and the
effective date of termination. In this case a severance payment will be
reasonably appropriate to the reason for termination, and this Agreement
will have no further effect.
9. OTHER EMPLOYMENT
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Payner covenants and agrees that during the employment period, she will
not directly or indirectly (except with the written consent of Spiegel)
become engaged in, be employed by, render services to or for, or permit
her name to be used in connection with any business other than the
business of Spiegel and its subsidiaries and affiliates, whether such
other business is or is not competitive with that business. After
termination of this Agreement, Payner agrees that for a period of one year
she will not solicit for engagement or as an employee any person who has
been employed by the Company within the preceding twelve months as a
senior level executive.
10. TRADE SECRETS
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Payner shall not at any time while this Employment Agreement is in force,
and for a period of two (2) years after its termination, unless authorized
by Spiegel, divulge or disclose to any person or corporation any
confidential or proprietary information relating to the business of
Spiegel or its subsidiaries and affiliates including, but not in
limitation, customer list, supplier lists, prices of products, services or
operational processes. A breach of this confidentiality clause will
result in no compensation and benefits being paid at the time of
termination.
11. 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 of this
agreement, supersedes all other
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agreements, whether oral or in writing, between the parties. This
agreement may be modified or added to only if evidenced in writing signed
by the party to be liable.
12. 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.
13. GOVERNING LAW
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This agreement shall be governed by the laws of the State of Illinois
without regard to principles of conflicts of laws.
IN WITNESS WHEREOF, the parties have executed this Agreement as of December 15,
2000.
SPIEGEL CATALOG, INC.
/s/ /s/ Xxxxxxx Xxxxxx-Xxxxxx
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Director Xxxxxxx Xxxxxx-Xxxxxx
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EMPLOYMENT AGREEMENT
SCHEDULE A
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This Schedule A is made a part of the Employment Agreement between Spiegel
Catalog, Inc. and Xxxxxxx Xxxxxx-Xxxxxx dated December 15, 2000.
Annual compensation effective December 15, 2000 will be Five Hundred Fifty
Thousand Dollars ($550,000.00).
Bonus opportunity for each year of this contract shall be 75% of base salary.
Dated: December 15, 2000
/s/ /s/ Xxxxxxx Xxxxxx-Xxxxxx
--------------------------------- --------------------------------------
Spiegel Catalog, Inc. Xxxxxxx Xxxxxx-Xxxxxx
EMPLOYMENT AGREEMENT
SCHEDULE B
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This Schedule B is made part of the Employment Agreement between Spiegel
Catalog and Xxxxxxx Xxxxxx-Xxxxxx dated December 15, 2000.
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 Spiegel has to reach.
For the year 2001, the pre-tax profit range is as follows:
50% of Bonus Opportunity: $19.8 million EBT
100% of Bonus Opportunity: $28.3 million EBT
150% of Bonus Opportunity: $36.8 million EBT
Dated: December 15, 2000
/s/ /s/ Xxxxxxx Xxxxxx-Xxxxxx
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Spiegel Catalog, Inc. Xxxxxxx Xxxxxx-Xxxxxx
