EXHIBIT 10.1
SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE
This Settlement Agreement and Mutual General Release ("Agreement") is
made and entered into as of March 29, 2007 (the "Effective Date") by and between
Xxxxxxxxx X. Xxxxx ("Xxxxx") and The TJX Companies, Inc. ("TJX").
WHEREAS, Xxxxx was formerly employed at TJX as Senior Executive Vice
President, Group President pursuant to a written employment agreement dated as
of April 5, 2005 (the "Employment Agreement") and resigned such employment
effective January 29, 2007; and
WHEREAS, the Employment Agreement contains certain restrictive
covenants; and
WHEREAS, Xxxxx is currently employed as the President and Chief
Executive Officer of Pier 1 Imports, Inc. ("Pier 1"); and
WHEREAS, TJX contends that Xxxxx'x employment with Pier 1 constitutes a
violation of the restrictive covenants of the Employment Agreement, and has
refused to pay certain amounts of Xxxxx'x compensation as a result; and
WHEREAS Xxxxx denies that his employment with Pier 1 constitutes a
violation of the restrictive covenants of the Employment Agreement; and
WHEREAS, Xxxxx and TJX desire to resolve, without further litigation or
adjudication, all asserted and potential claims arising out of or relating in
any way to Xxxxx'x former employment with TJX and Xxxxx'x current employment
with Pier 1;
THEREFORE, in consideration of the mutual promises, conditions,
representations and agreements set forth herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Xxxxx and TJX agree as follows:
1. Definitions.
(a) Any reference in this Agreement to "Xxxxx" shall at all times
unless otherwise specified include, and this Agreement shall
cover, Xxxxxxxxx X. Xxxxx, his heirs, administrators,
representatives, executors, legatees, successors, attorneys,
agents, and assigns, as well as anyone claiming by or through
him.
(b) Any reference in this Agreement to "TJX," including but not
limited to the reference to TJX in the General Release below,
shall at all times unless otherwise specified include, and
this Agreement shall cover, The TJX Companies, Inc., a
Delaware corporation with its principal place of business in
Framingham, Massachusetts, all of its parents, subsidiaries,
affiliates, predecessors, successors, assigns, all other legal
entities describing its organization or through which it
conducts business, and all of its current directors, officers,
employees, representatives, trustees, attorneys, agents,
insurers and assigns.
(c) Any reference in this Agreement to "Pier 1" shall at all times
unless otherwise specified include Pier 1 Imports, Inc., a
Delaware corporation with its principal place of business in
Fort Worth, Texas, and all of its parents, subsidiaries,
affiliates, predecessors, successors, assigns, all other legal
entities describing its organization or through which it
conducts business, and all of its current directors, officers,
employees, representatives, trustees, attorneys, agents,
insurers and assigns.
2. Monetary Payments from TJX.
(a) Acknowledgements. Xxxxx and TJX acknowledge and agree that,
during his employment with TJX, Xxxxx participated in TJX's
Management Incentive Plan ("MIP"), TJX's Long Range
Performance Incentive Plan ("LRPIP") and TJX's Supplemental
Executive Retirement Plan ("SERP"). Xxxxx and TJX further
acknowledge and agree that, as of the date of his resignation
from TJX, Xxxxx had accrued the following unpaid benefits
under those plans:
(i) MIP -- $697,566.30
(ii) LRPIP -- $373,746.24
(iii) SERP -- $1,266,000.00
(b) Payment to Xxxxx. Provided that Xxxxx first executes this
Agreement, and subject to his full compliance with the terms
hereof, TJX agrees to pay Xxxxx the xxxxx amount of $175,000
less applicable withholding taxes (the "Settlement Payment"),
which Settlement Payment shall reflect payments to Xxxxx as
follows:
(i) MIP -- $0
(ii) LRPIP -- $0
(iii) SERP -- $175,000
The Settlement Payment shall be paid in two installments. The
first installment shall be in the gross amount of $100,000,
and shall be paid on or within ten days following July 29,
2007. The second installment shall be in the gross amount of
$75,000, and shall be paid on or before July 29, 2008. Each
installment of the Settlement Payment shall be paid in the
form of an electronic deposit to Xxxxx'x account, if
available, and if not shall be in the form of a check made
payable to "Xxxxxxxxx Xxxxx" and shall be sent or delivered to
an address that Xxxxx shall designate.
(c) Forfeiture of Additional Payments. Xxxxx agrees and
acknowledges that the Settlement Payment shall represent full
and final satisfaction of any and all amounts that he may
claim are owed to him under the MIP, LRPIP and/or SERP, and
Xxxxx fully and irrevocably forfeits any other or additional
amounts that he had accrued under the MIP, LRPIP and/or SERP
as of the date of his resignation from TJX.
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(d) Tax Treatment.
(i) Tax treatment. TJX shall withhold, report and remit
all required federal and state taxes from the
Settlement Payment, such that TJX will issue IRS
Forms W-2 to Xxxxx reflecting the portion of the
Settlement Payment actually paid to Xxxxx in a given
tax year (i.e., TJX will issue Xxxxx a Form W-2 in
the amount of $100,000 for the tax year 2007, and TJX
will issue Xxxxx a Form W-2 in the amount of $75,000
for the tax year 2008, provided that each of those
payments was made in those years). Each Form W-2 will
reflect applicable withholding taxes.
(ii) No advice. Xxxxx acknowledges that TJX has not
provided advice to him regarding the proper tax
treatment of the Settlement Payment or any payments
or benefits received by Xxxxx in accordance with this
Agreement, and that he has been advised to consult
with his personal tax or financial advisor for such
advice.
(iii) TJX may make all necessary tax-related filings. Xxxxx
agrees that TJX shall be entitled to make any and all
filings regarding any payments or benefits made under
this Agreement with federal and/or state tax and
securities authorities which TJX, in its sole
discretion, determines are appropriate or required,
subject to the provisions of Paragraph 2(d)(i) above.
3. Mutual General Releases.
(a) Except with respect to any rights, obligations or duties
arising out of this Agreement, and except with respect to any
rights of indemnity, including under any TJX policy, practice,
insurance policy, indemnity contract, corporate law, bylaw,
article of incorporation or otherwise, and in consideration of
the Settlement Payment as set forth in this Agreement and
other valuable consideration, Xxxxx hereby releases and
discharges TJX and all of its present and former officers,
directors, partners, investors, stockholders, trustees,
attorneys, insurers, representatives, agents, employees and
employee benefit plans, and anyone acting for or on behalf of
any of the foregoing (collectively, the "TJX Releasees"), of
and from any and all complaints, charges, lawsuits and claims
for relief of any kind by Xxxxx that he now has, ever had or
may have in the future against the TJX Releasees or any one of
them, whether known or unknown, arising out of any matter or
thing that has happened before the signing of this Agreement,
including but not limited to claims arising under common law
or statute, claims for breach of contract (including but not
limited to the Employment Agreement and any other contract,
agreement, plan, grant or other document relating to Xxxxx'x
former employment with TJX) and in tort (including but not
limited to claims for defamation, invasion of privacy,
intentional or negligent infliction of emotional distress and
claims for intentional interference with contractual or
advantageous relations), and claims arising under federal and
state labor laws, employment laws and laws prohibiting
discrimination on the basis of age, sex, race, national origin
or disability. The laws referred to in the preceding
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sentence include but are not limited to Title VII of the Civil
Rights Act of 1964, the Employee Retirement Income Security
Act of 1974 ("ERISA"), the Equal Pay Act of 1963, the Age
Discrimination in Employment Act of 1967 ("ADEA"), the Fair
Labor Standards Act of 1938, the Americans with Disabilities
Act of 1990, the Rehabilitation Act of 1973, the Family and
Medical Leave Act of 1993, Chapters 149 through 154 of the
Massachusetts General Laws, the Massachusetts Civil Rights Act
and the Massachusetts Equal Rights Law, all as amended. It is
further expressly agreed and understood by Xxxxx that the
release contained herein is a GENERAL RELEASE.
(b) Except with respect to any rights, obligations or duties
arising out of this Agreement and the Employment Agreement (as
modified by Sections 5 and 8 of this Agreement), and in
consideration of Xxxxx'x General Release to the TJX Releasees
and other valuable consideration, TJX and anyone acting for or
on behalf of TJX, hereby release and discharge Xxxxx of and
from any and all complaints, charges, lawsuits and claims for
relief of any kind that TJX now has, ever had or may have in
the future against Xxxxx, whether known or unknown, arising
out of any matter or thing that has happened before the
signing of this Agreement, including but not limited to claims
arising out of Xxxxx'x former employment with TJX, Xxxxx'x
present employment with Pier 1, claims arising under common
law or statute, claims for breach of contract (including but
not limited to the Employment Agreement and any other
contract, agreement, plan, grant or other document relating to
Xxxxx'x former employment with TJX) and in tort (including but
not limited to claims for defamation, invasion of privacy,
intentional or negligent infliction of emotional distress and
claims for intentional interference with contractual or
advantageous relations). It is further expressly agreed and
understood by TJX that the release contained herein is a
GENERAL RELEASE.
4. Covenants Not to Xxx.
(a) Xxxxx represents and warrants that he has not filed any
complaints, charges, demands for arbitration or mediation or
any other claims for relief (collectively, "Claims") against
the TJX Releasees, or any one of them, with any local, state
or federal court or administrative agency, any professional or
regulatory board, any arbitrator or mediator, or any other
agency or entity. To the extent of any such filing made by him
or purporting to have been made on his behalf, Xxxxx agrees to
dismiss such Claims with prejudice and without costs. Xxxxx
further warrants that he has not previously assigned or
transferred any Claims that are subject to the General Release
contained herein. Xxxxx agrees and covenants not to xxx or
bring any Claims against the TJX Releasees, or any one of
them, whether in court or in arbitration or mediation, with
respect to matters subject to the General Release contained
herein. Xxxxx further agrees not to institute any claim,
charge, complaint or lawsuit to challenge the validity of the
General Release or the circumstances surrounding its
execution. In the event that Xxxxx institutes any action
covered by this Paragraph, that action shall be dismissed upon
presentation of this Agreement.
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(b) TJX represents and warrants that it has not filed any
complaints, charges, demands for arbitration or mediation, or
any other claims for relief (collectively, "Claims") against
Xxxxx with any local, state or federal court or administrative
agency, any professional or regulatory board, any arbitrator
or mediator, or any other agency or entity. To the extent of
any such filing made by it or purporting to have been made on
its behalf, TJX agrees to dismiss such Claims with prejudice
and without costs. TJX further warrants that it has not
previously assigned or transferred any Claims that are subject
to the General Release contained herein. TJX agrees and
covenants not to xxx or bring any Claims, whether in court or
in arbitration or mediation, against Xxxxx with respect to
matters subject to the General Release contained herein. TJX
further agrees not to institute any claim, charge, complaint
or lawsuit to challenge the validity of the General Release or
the circumstances surrounding its execution. In the event that
TJX institutes any action covered by this Paragraph, that
action shall be dismissed upon presentation of this Agreement.
5. Non-Competition, Non-Solicitation.
(a) Xxxxx and TJX understand and agree that, Xxxxx having
forfeited all accrued amounts under the MIP, LRPIP and SERP
(other than the Settlement Payment as set forth above), any
covenant not to compete to which TJX and Xxxxx are or were
both parties, including but not limited to Section 8(b) of the
Employment Agreement, shall no longer have any force and
effect whatsoever with respect to Xxxxx'x employment at Pier
1. For purposes of clarity, it is expressly understood and
agreed between Xxxxx and TJX that TJX fully and irrevocably
releases Xxxxx from the restrictions of any such covenant not
to compete, including but not limited to that contained in
Section 8(b) of the Employment Agreement, with respect to
Xxxxx'x employment at Pier 1, and waives its right, both now
and at any time in the future, to bring any claim in any court
or file any demand for arbitration or mediation in which TJX
invokes or relies in any way on Section 8(b) of the Employment
Agreement, or any other covenant not to compete to which TJX
and Xxxxx are or were both parties, to challenge Xxxxx'x
actions after January 29, 2007 in respect to his employment at
Pier 1, including but not limited to any challenge to Xxxxx'x
employment or activities with or on behalf of Pier 1 and
further including but not limited to any duties or functions
that Xxxxx performed, performs or may perform for Pier 1 after
January 29, 2007, now and at any time in the future,
specifically including but not limited to any conduct that
occurs after the Effective Date of this Agreement. In the
event that TJX institutes any action covered by this Paragraph
5(a), that action shall be dismissed upon presentation of this
Agreement and TJX shall reimburse Xxxxx for legal fees
incurred in obtaining such dismissal. Notwithstanding the
foregoing, it is agreed and understood that the restrictions
contained in Section 8 of the Employment Agreement shall
continue in full force and effect in accordance with their
terms in all circumstances and contexts other than with
respect to the application of Section 8(b) to Xxxxx'x
employment at Pier 1.
(b) For the avoidance of doubt and for the purpose of clarifying
Xxxxx'x continuing obligations under Section 8(a) of the
Employment Agreement, for a period beginning
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on the Effective Date of this Agreement and ending on January
29, 2009, Xxxxx shall not, and shall not direct Pier 1 or any
other individual or entity to, directly or indirectly
(including as a partner, shareholder, joint venturer or other
investor), other than as excepted herein or with the written
consent of TJX:
(i) Hire, offer to hire, attempt to hire or assist in the
hiring of, any Protected Person as an employee,
director, consultant, advisor or other service
provider;
(ii) Recommend any Protected Person for employment or
service engagement with any person or entity other
than TJX, except that Xxxxx may provide employment
references given in the ordinary course of business
for any Protected Person;
(iii) Solicit as an employee, director, consultant, advisor
or other service provider any Protected Person, or
seek to persuade, induce or encourage any Protected
Person to discontinue employment or service as a
director, consultant, advisor or other service
provider with TJX, or recommend to any Protected
Person any employment or engagement other than with
TJX, except that Xxxxx may provide employment
references given in the ordinary course of business
for any Protected Person;
(iv) Accept services (whether for compensation or
otherwise) from any Protected Person which are
similar in nature to the services provided by the
Protected Person to TJX in his or her capacity as an
employee, director, consultant, advisor or other
service provider; or
(v) Participate with any other person or entity in any of
the foregoing activities.
(c) For purposes of this Paragraph 5, a Protected Person is a
person who, between July 29, 2006 and January 29, 2007
inclusive, was employed or is employed by TJX either in a
position of (i) Assistant Vice President or higher, or (ii) in
a salaried position in any merchandising group with a salary
in excess of $50,000 per year. As to (I) each Protected Person
to whom the foregoing applies, (II) each subcategory of
Protected Person, as defined above, (III) each limitation on
(A) employment or other engagement, (B) solicitation and (C)
unsolicited acceptance of services, of each Protected Person
and (IV) each month of the period during which the provisions
of Paragraph 5(b) apply to each of the foregoing, the
provisions set forth in Paragraph 5(b) shall be deemed to be
separate and independent agreements. In the event of
unenforceability of any one or more such agreement(s), such
unenforceable agreement(s) shall be deemed automatically
reformed in order to allow for the greatest degree of
enforceability authorized by law or, if no such reformation is
possible, deleted from the provisions hereof entirely, and
such reformation or deletion shall not affect the
enforceability of any other provision of this subsection or
any other term of this Agreement.
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(d) Notwithstanding the foregoing, it shall not be a violation or
breach of this Agreement:
(i) If a Protected Person is solicited, hired, contracted
or otherwise engaged by Pier 1 inadvertently (defined
to mean without actual knowledge by Xxxxx) and as to
such action (I) Xxxxx receives no objection from TJX
within 30 days of TJX learning of such action; or
(II) after written notice of objection from TJX, the
employment relationship in issue does not go forward,
is not continued, or the matter is otherwise cured to
the satisfaction of TJX;
(ii) For consent to be sought from TJX to perform any act
that may otherwise constitute a violation of
Paragraph 5(b);
(iii) For Xxxxx to engage in any activity described in
Paragraph 5(b) above with any Protected Person who is
not employed or otherwise engaged with TJX as of the
date of first contact initiated by Xxxxx and/or Pier
1, provided that (A) the termination or cessation of
such Protected Person's employment or service as a
director, consultant, advisor or other service
provider with TJX was effectuated for a good faith,
bona fide reason and was not intended to be a sham or
artifice to avoid the restrictions contained in this
Agreement; and (B) such Protected Person held a good
faith, bona fide position as an employee, director,
consultant, advisor or other service provider with
any entity other than Pier 1 subsequent to such
Protected Person's employment with TJX; or
(iv) For Xxxxx to contact or otherwise communicate with
any Protected Person on a social basis, so long as
Xxxxx shall not engage in any of the prohibited
activities described in Paragraph 5(b) above in the
course of such contact or communication.
(e) Nothing in this Agreement shall be construed to require
contractually Pier 1 to take any action, or refrain from
taking any action, whatsoever.
6. Nonadmissions. It is understood and agreed by Xxxxx and TJX that this
Agreement effects the settlement of claims that are denied and
disputed, and that nothing contained herein nor the fact that this
Agreement has been executed shall constitute or be construed as an
admission by any Party of any kind of liability, or as an admission of
any violation by any Party of any federal or state law, statute,
policy, rule or regulation or common law obligation or of any
wrongdoing whatsoever. Each Party hereto denies liability of any kind
to any other Party, and by entering into this Agreement intends merely
to avoid further litigation, arbitration, dispute or mediation.
7. Breach. Xxxxx and TJX agree that in the event that one Party breaches
any part or parts of this Agreement, legal proceedings subject to and
consistent with the provisions of Paragraph 12 hereof may be instituted
against that Party for breach of contract. In the event that a Party
institutes such legal proceedings for breach of this Agreement, it is
agreed that
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the sole remedy available to said party shall be enforcement of the
terms of this Agreement and/or a claim for damages resulting from a
breach of this Agreement, including, but not limited to, the costs and
attorneys' fees associated with bringing an action for enforcement of
this Agreement; but under no circumstances shall Xxxxx or TJX be
entitled to revive, reassert or assert any claims that they have
released or abandoned under this Agreement. Notwithstanding the
foregoing, and in addition to any other remedies to which it may be
entitled, it is agreed that, if Xxxxx should violate any part or parts
of this Agreement, he shall immediately forfeit and disgorge to TJX the
Settlement Payment paid to him pursuant to Paragraph 2(b) hereof, and
TJX shall be entitled to withhold any portion of the Settlement Payment
not previously paid to Xxxxx; provided, however, that any disputes
concerning violation and/or forfeiture will ultimately be considered
and decided by an arbitrator pursuant to Paragraph 12 of this
Agreement.
8. Entire Agreement. This Agreement contains and constitutes the entire
understanding and agreement between Xxxxx and TJX with respect to the
matters which are the subject of this Agreement, and it supersedes and
cancels all prior and contemporaneous negotiations, agreements,
commitments, communications, and understandings, written or oral,
between Xxxxx and TJX, with the exception of the provisions of Sections
8 and 13 of the Employment Agreement, which shall continue in full
force and effect except as otherwise provided in Section 5 of this
Agreement. In entering into this Agreement, no Party is relying upon
any promise, inducement or representation other than those set forth in
this Agreement.
9. Amendment. This Agreement shall be binding upon Xxxxx and TJX and may
not be released, discharged, abandoned, supplemented, amended, changed,
or modified in any manner, orally or otherwise, except by an instrument
in writing of concurrent or subsequent date, signed by Xxxxx and a duly
authorized officer or representative of TJX.
10. Validity. Xxxxx and TJX agree that each provision of this Agreement,
other than the General Release and Covenant Not to Xxx provisions, is
severable, and should any such provision be determined by a court of
competent jurisdiction, arbitrator or administrative agency to be
illegal or invalid, the validity of the remaining provisions shall not
be affected and the illegal or invalid provisions shall be deemed not
to be a part of this Agreement.
11. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Massachusetts without
regard to conflict of laws provisions.
12. Arbitration. In the event that there is any claim or dispute arising
out of or relating to this Agreement, or the breach thereof, and Xxxxx
and TJX shall not have resolved such claim or dispute within sixty (60)
days after written notice from one Party to the other setting forth the
nature of such claim or dispute, then such claim or dispute shall be
settled exclusively by binding arbitration in Boston, Massachusetts in
accordance with the Employment Arbitration Rules and Mediation
Procedures of the American Arbitration Association ("Rules") by an
arbitrator mutually agreed upon by Xxxxx and TJX or, in the absence of
such agreement, by an arbitrator selected according to the Rules.
Notwithstanding the foregoing, if either Xxxxx or TJX shall request,
such arbitration shall be conducted by a panel of three
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arbitrators, one selected by Xxxxx, one selected by TJX and the third
selected by agreement of the first two or, in the absence of such
agreement, in accordance with the Rules. The prevailing party in any
arbitration hereunder shall be entitled to an award of its costs and
attorney's fees. Judgment upon the award rendered by such arbitrator(s)
shall be entered in any court having jurisdiction thereof upon the
application of either Party. Xxxxx and TJX understand and agree that
this arbitration clause does not bind Pier 1 to any such arbitration.
13. Captions and Headings. Captions and headings used herein are inserted
for convenience, do not constitute a part of this Agreement, and shall
not be admissible for the purpose of proving the intent of Xxxxx and
TJX.
14. No Strict Construction. The language used in this Agreement is the
language chosen by Xxxxx and TJX to express their mutual intent, and no
rule of strict construction will be applied against either Party.
15. Execution in Counterparts. This Agreement may be executed in two or
more duplicate counterparts, each of which shall be treated as an
original, but all of which together shall constitute one and the same
instrument, and in pleading or proving any provision of this Agreement,
it shall not be necessary to produce more than one such counterpart.
For the convenience of Xxxxx and TJX, facsimile and pdf signatures
shall be accepted as originals.
16. Waiver. No waiver of any provision of this Agreement, or the breach
thereof, shall be deemed a waiver or breach of any other provision.
17. Representations. Xxxxx represents and acknowledges that:
(a) He has been advised to consult an attorney and has done so
prior to executing this Agreement. This representation does
not waive his right to rely upon the attorney/client privilege
with respect to the subject matter and substance of his
consultations with his attorney.
He has been given at least twenty-one (21) days to consider
this Agreement, that he has seven (7) days from the date he
executes this Agreement in which to revoke it, and that this
Agreement will not be effective or enforceable until after the
seven-day revocation period ends without revocation by him.
Revocation can be made by delivery of a written notice of
revocation to counsel for TJX by midnight on or before the
seventh day after Xxxxx signs the Agreement.
(b) He has carefully read this Agreement, fully understands its
terms, their meaning, and their effect upon his rights and the
duties hereby undertaken by him; understands the final and
binding effect of this Agreement; freely and voluntarily
assents to all the terms and conditions hereof; and signs the
same as his own free act with the full intent of releasing the
TJX Releasees from all claims released herein.
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Intending to be legally bound, Xxxxx and TJX have set their hands and
seals to this Agreement as of the date written above.
The TJX Companies, Inc. Xxxxxxxxx X. Xxxxx
By: /s/ Xxx XxXxxxxx By: /s/ Xxxxxxxxx X. Xxxxx
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Xxx XxXxxxxx Xxxxxxxxx X. Xxxxx
Executive Vice President and
General Counsel
The TJX Companies, Inc.
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