Re: Amendment to Employment Agreement Dear _______________:
EXHIBIT 10.13
December 16, 2008
0 Xxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Re: Amendment to Employment Agreement
Dear _______________:
This document constitutes an amendment of the Employment Agreement between The Great Atlantic
& Pacific Tea Company, Inc. (the “Company”) and you dated _______________ (the “Agreement”).
Capitalized terms that are not otherwise defined in this document shall have the meanings set forth
in the Agreement.
1. Section 7.2 is hereby amended by deleting the third sentence in its entirety and
replacing it with the following sentence: For purposes of this Agreement, the Employee shall be
considered to have incurred a Permanent and Total Disability if she becomes disabled within the
meaning of Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations
thereunder.
2. Section 7.3(c) is hereby amended by adding the following sentence at the end of the
section: The commencement of payments pursuant to this Section shall be subject to Section 22 of
this Agreement.
3. Section 10(c) is hereby amended by adding the following sentence at the end of the
section: The commencement of payments pursuant to this Section shall be subject to Section 22 of
this Agreement.
4. Section 10(d) is hereby amended by deleting the last sentence in its entirety and
replacing it with the following sentence: Subject to Section 22 of this Agreement, such payment
shall be made on the date on which bonuses for the applicable fiscal year are paid to executives of
the Company generally under the Company’s annual management incentive bonus plan, and the Employee
shall have no right to any further bonuses under said plan.
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5. Section 11(c) is hereby amended by deleting the last sentence in its entirety and
replacing it with the following sentences: Such severance benefit shall be paid in a lump sum on
such date as shall be determined by the Company in its discretion but no later than 45 days after
the date of such termination of employment. Any payment pursuant to this Section shall be subject
to Section 22 of this Agreement.
6. Section 11(d) is hereby amended by deleting the last sentence in its entirety and
replacing it with the following sentence: Subject to Section 22 of this Agreement, such payment
shall be made on the date on which bonuses for the applicable fiscal year are paid to executives of
the Company generally under the Company’s annual management incentive bonus plan, and the Employee
shall have no right to any further bonuses under said plan.
7. Section 12 is hereby amended by deleting the definition of “Change of Control” in its
entirety and replacing it with the following: For purposes of this Agreement, a “Change of
Control” shall mean a change in the effective control of the Company, or a change in the ownership
of a substantial portion of the assets of the Company, within the meaning of Section 409A of the
Internal Revenue Code of 1986, as amended, and the regulations thereunder; provided, however, that
a Change of Control shall not occur where the Company, any subsidiary of the Company, or Tengelmann
Warenhandelgesellschaft KG (a partnership organized under the laws of the Federal Republic of
Germany or any successor to such partnership) acquires effective control of the Company, or
acquires additional control of the Company after having acquired effective control of the Company,
or acquires ownership of a substantial portion of the assets of the Company, all within the meaning
of Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations thereunder.
8. Section 19 is hereby amended by adding the following as 19(e): Anything in this Section
19 to the contrary notwithstanding, the Gross-Up Payments shall be made no later than the end of
the calendar year next following the calendar year in which the Employee remits the related taxes.
9. Section 22 is hereby amended by deleting the section in its entirety and replacing it
with the following:
22. Compliance with IRC Section 409A.
In the event that it shall be determined that any payments or benefits under this Agreement
constitute nonqualified deferred compensation covered by Section 409A of the Internal Revenue Code
of 1986, as amended (the “Code”), for which no exemption under Code Section 409A or the regulations
thereunder is available (“Covered Deferred Compensation”), then notwithstanding anything in this
Agreement to the contrary, (i) if the Employee is a “specified employee” (within the meaning of
Code Section 409A and the regulations thereunder and as determined by the Company in accordance
with said Section 409A) at the time of the Employee’s separation from service (as defined below),
the payment of any such Covered Deferred Compensation payable on account of such separation from
service shall be made no earlier than the date which is 6 months after the date of the Employee’s
separation from service (or, if earlier than the end of such 6-month period, the date of Employee’s
death) and (ii) the Employee shall be deemed to have terminated from employment for purposes of
this Agreement if and only if the Employee has experienced a “separation from service” within the
meaning of said Section 409A and the regulations thereunder. To the extent any payment of Covered
Deferred Compensation is subject to the 6-month delay, such payment shall be paid
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immediately at the end of such 6-month period (or the date of death, if earlier). Whenever
payments under this Agreement are to be made in installments, each such installment shall be deemed
a separate payment for purposes of Code Section 409A. The provisions of this Agreement relating to
such Covered Deferred Compensation shall be interpreted and operated consistently with the
requirements of Code Section 409A and the regulations thereunder. If it is found by the IRS that
this Agreement fails Code Section 409A in terms of written documentary compliance, the Company will
indemnify the Employee for any legal and accounting costs, any taxes, interest and penalties, and
any other associated costs, that are related solely to the documentary non-compliance. Except as
set forth in the previous sentence, no other action or failure to act pursuant to this Section 22
shall subject the Company to any claim, liability or expense, and the Company shall have no
obligation to indemnify or otherwise protect Employee from the obligation to pay any taxes,
interest or penalties pursuant to Code Section 409A.
Anything in this Agreement to the contrary notwithstanding, any reimbursements or in-kind
benefits to which the Employee is entitled under this Agreement (other than such reimbursements or
benefits that are not taxable to the Employee for federal income tax purposes or that are otherwise
exempt from coverage under Section 409A of the Code pursuant to said Section 409A and the
regulations thereunder) shall meet the following requirements: (i) the amount of expenses eligible
for reimbursement, or in-kind benefits provided, in one calendar year may not affect the expenses
eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year (except
that the Company’s medical plans may impose a limit on the amount that may be reimbursed or
provided), (ii) any reimbursement of an eligible expense must be made on or before the last day of
the calendar year following the calendar year in which the expense was incurred, and (iii) the
Employee’s right to reimbursement or in-kind benefits shall not be subject to liquidation or
exchange for another benefit.
10. Except as set forth above, the provisions of the Agreement remain in effect.
If the terms outlined above are acceptable, please sign below and return to me an original
executed copy of this letter agreement. Upon execution of this letter agreement, the Executive
Employment Agreement shall be amended in accordance with Paragraph 28 thereof.
| Sincerely, The Great Atlantic & Pacific Tea Company, Inc. |
||||
| By: | ||||
| Xxxxx Xxxxxxxx, SVP Human Resources, | ||||
| Labor Relations and Legal Services | ||||
Agreed to and accepted this ___ day
of December, 2008.
of December, 2008.
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