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EXHIBIT 10
June 23, 1999
Xx. Xxxx X. Xxxxxxxxx
0 Xxxx Xxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Dear Xxxx:
This letter sets forth our understanding and agreement with respect to
your resignation as Senior Vice President - Human Resources of Venator Group,
Inc. (the "Company"), effective on the Termination Date, as hereinafter defined,
and sets forth the arrangements to which we have agreed.
You and the Company are parties to a Senior Executive Severance
Agreement dated May 5, 1999 (the "Severance Agreement"), a copy of which is
annexed hereto as Attachment A, and the arrangements set forth in this letter
agreement are intended to memorialize the obligations of each party to the other
thereunder in light of your resignation.
1. Termination of Employment. Your employment with the Company shall
continue until July 2, 1999 (the "Termination Date"). You shall resign as Senior
Vice President - Human Resources of the Company, and from all other positions
you hold with the Company or any of its subsidiaries, as of the close of
business on the Termination Date and you shall execute and deliver a letter of
resignation in the form annexed hereto as Attachment B as of such date.
2. Payments. Provided you continue to be employed by the Company on the
Termination Date and have satisfactorily performed your responsibilities through
such date, the Company shall make the following payments to you:
(a) On the latter of the Termination Date or the eighth day following
the day you sign and return this agreement to us, $177,500, being 50 percent of
the total Severance Benefit payable to you under the provisions of the Severance
Agreement, payable pursuant to the provisions of Section 3(a) thereof.
(b) On the latter of the Termination Date or the eighth day following
the day you sign and return this agreement to us, an additional amount of
$29,585.
(c) On the first anniversary of the Termination Date, provided you have
met the requirements set out in Sections 3(b) and 3(c) of the Severance
Agreement, $177,500 plus interest for the period from the Termination Date to
the date on which payment is made, calculated at the prime rate of interest as
stated in The Wall Street Journal on the Termination Date. For purposes of
determining
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whether you have engaged in "Competition" under Section 3(c) of the Severance
Agreement, a "business in competition with any business conducted by any member
of the Control Group for which Executive worked at any time", as used in Section
1(i) of the Severance Agreement, shall be any retail or wholesale business
located in North America, the European Union, Japan, or Australia selling
athletic footwear, athletic apparel, or sporting goods to or through retail
stores, catalogs, or the Internet.
(d) On the Termination Date, in accordance with the Company"s normal
policies and practices, (i) salary and reimbursement of any business expenses
related to the period prior to the Termination Date and (ii) an amount in lieu
of any accrued but unused vacation as of the Termination Date.
(e) You shall not be entitled to receive any payment under the Annual
Incentive Compensation Plan for 1999 or under the Long-Term Incentive
Compensation Plan for any period.
(f) All amounts payable to you hereunder shall be subject to
appropriate withholding for federal, state, and local income taxes.
3. Stock Option and Stock Purchase Plans. (a) All unexercised stock
options granted to you prior to the date hereof and not exercised or cancelled
on or before the Termination Date, pursuant to the provisions of the 1995 or the
1998 Venator Group Stock Option and Award Plans (the "Award Plans"), shall
remain exercisable in accordance with the relevant provisions of the Award
Plans. Your "effective date of termination" for purposes of the Award Plans
shall be the Termination Date and your termination shall, for the purposes of
such plans, be treated as your resignation from your position with the Company.
(b) The restrictions on the Restricted Stock granted to you on February
1, 1999 under the Award Plans shall not lapse and such shares of Restricted
Stock shall revert to the Company as of the Termination Date.
(c) Your right to participate in the 1994 Venator Group Employees Stock
Purchase Plan shall be in accordance with the terms of such plan and shall cease
as of the Termination Date.
4. Pension Benefits. You are not vested under the Venator Group
Retirement Plan and the Excess Cash Balance Plan, and you shall not be entitled
to any payments or other benefits from such plans or from the Supplemental
Executive Retirement Plan.
5. Other Benefits. (a) You shall continue to be eligible, following the
Termination Date, to continue to participate in any group medical, dental, or
life insurance plan you have participated in immediately prior to the
Termination Date, in accordance with, and for the time periods specified, in
Section 3(e) of the Severance Agreement. Your participation in the group
disability and voluntary accidental death and dismemberment plans for active
employees of the Company shall cease on the
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Termination Date. The Company will continue payment of the premiums for the
universal life insurance policy with MetLife presently in place, which policy is
owned by you, for the same period you are eligible to continue to participate in
group medical, dental, or life insurance plans under the provisions of Section
3(e) of the Severance Agreement.
(b) The Company shall provide to you, at its expense, until the earlier
of the first anniversary of the Termination Date or such time as you shall have
secured other full-time employment, the services of an out-placement consultant
selected by the Company.
6. Confidential Information and Non-Disparagement. (a) You acknowledge
that, following the Termination Date, you will continue to be bound by the
provisions of Section 14 of the Severance Agreement ("Confidentiality"). You
shall not, between the date hereof and the Termination Date, remove any
Confidential Information from the offices of the Company and you shall, on or
before the Termination Date, return all Confidential Information in your
possession, in whatever form, to the Company. The existence of this agreement
and the terms hereof shall be considered to be Confidential Information.
(b) During the period during which you are receiving, or entitled to
receive, any payments hereunder, you shall not make any statements or comments
(i) to any form of media or likely to come to the attention of any form of media
of a negative nature that reasonably could be considered to have an adverse
impact on the business or reputation of the Company or of any officer, employee,
or director thereof, or (ii) to any employee of the Company or to any supplier
or customer of the Company of a negative nature that could reasonably be
considered to have an adverse impact on the business of the Company or of any
officer, employee, or director of the Company; provided, however, that in no
event shall the foregoing limitations apply to (V) compliance with legal process
or subpoena, (W) statements in response to an inquiry from a court or regulatory
body, (X) in rebuttal of media stories with regard to you, (Y) to a possible
future employer in connection with employment discussions, or (Z) in response to
an inquiry from the Company.
You acknowledge that a violation by you of the provisions of this Section 6 or
of the provisions of Section 14 of the Severance Agreement would cause
irreparable injury to the Company for which there would be no adequate remedy at
law.
7. Release from Claims. In consideration of all of the foregoing, you,
for yourself and for your heirs, executors, administrators, successors, and
assigns, hereby agree to release and forever discharge the Company and its
subsidiaries and affiliates, and their respective officers and directors, from
any and all actions, causes of action, claims, demands, and liabilities of
whatsoever nature arising out of, or in connection with, your employment with
the Company and any of its subsidiaries and affiliates, or otherwise, whether
arising before or after the date hereof. The foregoing shall include, but not be
limited to, any claim of employment discrimination under the Age Discrimination
in Employment Act of 1967, the New York State Human Rights Law, or any other
federal or state labor relation law, equal employment opportunity law, or civil
rights law, regulation or order. Federal law requires that we advise you to
consult with an attorney of your choice (at your own cost).
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In addition, federal law also provides that you have 21 days from the date of
this letter to consider your decision to agree to the terms of this agreement,
including any release of the Company and its subsidiaries, from liability as
provided in this paragraph. Furthermore, you have the right to change your mind
at any time within one week after signing. In addition, you hereby acknowledge
that you have been given full opportunity to review this letter, including
sufficient opportunity to review this letter, including sufficient opportunity
for appropriate review with any advisors selected by you. The foregoing shall
not constitute a release of any and all claims you may have against the Company
for breach of any of the provisions of this letter agreement.
You understand and agree that the payments and benefits provided for in
this letter agreement shall be in lieu of any and all amounts that would be
payable to you, and that no other amounts will be paid to you for any reason
whatsoever.
8. Assignment. Neither this letter agreement, nor any of the rights
arising hereunder, may be assigned by you. You agree to execute such additional
documents as the Company may require to carry out this letter agreement.
9. Miscellaneous. This letter agreement and the Severance Agreement
represent our total understanding and agreement with regard to the subject
matter hereof, and supersede any previous discussions or writings. This letter
agreement may not be amended or modified, and no term or provision hereof may be
waived or discharged, unless agreed to in writing by you and the Company. The
invalidity or unenforceability of any provision of this letter agreement shall
not affect the validity or enforceability of any other provision hereof.
The section headings herein are for convenience of reference only and
shall not affect or be utilized in the construction or interpretation of this
letter agreement.
This letter agreement may be executed in counterparts, each of which,
when so executed, shall be deemed an original and all of which, when taken
together, shall constitute one and the same agreement.
The offer of the Company contained in this letter agreement shall
terminate and be of no further force and effect at 12:01 A.M. New York City time
on the twenty-second day following the delivery of this letter to you, unless
you have signed and returned the letter to us, unaltered, before such date and
time.
10. Governing Law. This letter agreement shall be governed by, and
construed under, the laws of the State of New York applicable to contracts made
between residents of such state and to be wholly performed in such state.
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If this letter agreement correctly sets forth our agreement, please
execute the duplicate copy of this letter agreement enclosed for that purpose,
and deliver it to us, at which time this letter agreement shall serve as a
binding and enforceable agreement between us.
Very truly yours,
VENATOR GROUP, INC.
By:/s/ Xxxx X. Xxxxxxx
-------------------
President
Agreed:
/s/ Xxxx X. Xxxxxxxxx
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Xxxx X. Xxxxxxxxx
Witnessed:
/s/ Xxxxxxx Xxxxxxxx
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Date:6/24/99
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ATTACHMENT A
AGREEMENT
THIS AGREEMENT made as of May 5, 1999 by and between VENATOR GROUP,
INC., a New York corporation with its principal office at 000 Xxxxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 (the "Company") and Xxxx X. Xxxxxxxxx, residing at Xxxxx
Xxxx Xxxx Xxxx, Xxxxxxxx, Xxxxxxxxxxx 00000 (the "Executive").
W I T N E S S E T H:
WHEREAS, the Company believes that the establishment and maintenance of
a sound and vital management of the Company is essential to the protection and
enhancement of the interests of the Company and its shareholders; and
WHEREAS, the Company wishes to offer a form of protection to the
Executive, as one of a select group of officers and key employees of the Company
and its Affiliates, in the event the Executive's employment with the Control
Group terminates; and
WHEREAS, the Company also recognizes that the possibility of a Change
in Control of the Company, with the attendant uncertainties and risks, might
result in the departure or distraction of the Executive to the detriment of the
Company; and
WHEREAS, the Company wishes to induce the Executive to remain with the
Control Group, and to reinforce and encourage the Executive's continued
attention and dedication, when faced with the possibility of a Change in Control
of the Company; and
WHEREAS, this Agreement amends and supersedes any employment agreement,
severance plan, policy and/or practice of the Company in effect for the
Executive.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereto hereby agree as follows:
1. Definitions. The following terms shall have the meanings set
forth in this section as follows:
(a) "Affiliate" shall mean the Company and any entity affiliated with
the Company within the meaning of Code Section 414(b) with respect to a
controlled group of corporations, Code Section 414(c) with respect to trades or
businesses under common control with the Company, Code Section 414(m) with
respect to affiliated service groups and any other entity required to be
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the Company under Section 414(o) of the Code. No entity shall be treated as an
Affiliate for any period during which it is not part of the controlled group,
under common control or otherwise required to be aggregated under Code Section
414.
(b) "Beneficiary" shall mean the individual designated by the
Executive, on a form acceptable by the Committee, to receive benefits payable
under this Agreement in the event of the Executive's death. If no Beneficiary is
designated, the Executive's Beneficiary shall be his or her spouse, or if the
Executive is not survived by a spouse, the Executive's estate.
(c) "Board" shall mean the Board of Directors of the Company.
(d) "Bonus" shall mean an amount equal to the target bonus expected to
be earned by the Executive under the Company's Annual Incentive Compensation
Plan or such other annual bonus plan or program that may then be applicable to
the Executive in a fiscal year, if the applicable target performance goal is
satisfied.
(e) "Cause" shall mean (with regard to the Executive's termination of
employment with the Control Group): (i) the refusal or willful failure by the
Executive to substantially perform his or her duties, (ii) with regard to the
Control Group or any of their assets or businesses, the Executive's dishonesty,
willful misconduct, misappropriation, breach of fiduciary duty or fraud, or
(iii) the Executive's conviction of a felony (other than a traffic violation) or
any other crime involving, in the sole discretion of the Committee, moral
turpitude.
(f) "Change in Control" shall have the meaning set forth in Appendix A
attached hereto.
(g) "Code" shall mean the Internal Revenue Code of 1986, as amended and
as hereafter amended from time to time.
(h) "Committee" shall mean the Compensation Committee of the Board or
an administrative committee appointed by the Compensation Committee.
(i) "Competition" shall mean the (i) participating, directly or
indirectly, as an individual proprietor, stockholder, officer, employee,
director, joint venturer, investor, lender, or in any capacity whatsoever
(within the United States of America, or in any country where any of the
Executive's former employing members of the Control Group does business) in a
business in competition with any business conducted by any member of the Control
Group for which the Executive worked at any time, provided, however, that such
participation shall not include (A) the mere ownership of not more than 1
percent of the total outstanding stock of a publicly held company; (B) the
performance of services for any enterprise to the extent such services are not
performed, directly or indirectly, for a business in which any of the Employee's
employing members of the Control Group is engaged; or (C) any activity engaged
in with the prior written approval of the Board or the Committee; or (ii)
intentional recruiting, soliciting or inducing, of any employee or employees of
the Control Group to
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terminate their employment with, or otherwise cease their relationship with the
former employing members of the Control Group where such employee or employees
do in fact so terminate their employment.
(j) "Control Group" shall mean the Company and its Affiliates.
(k) "Good Reason" shall mean (with respect to an Executive's
termination of employment with the Control Group): (i) any material demotion of
the Executive or any material reduction in the Executive's authority or
responsibility, except in each case in connection with the termination of the
Executive's employment for Cause or disability or as a result of the Executive's
death, or temporarily as a result of the Executive's illness or other absence;
(ii) prior to a Change in Control, a reduction in the Executive's rate of base
salary as payable from time to time, other than a reduction that occurs in
connection with, and in the same percentage as, an across-the-board reduction
over any three-year period in the base salaries of all executives of the Company
of a similar level and where the reduction is less than 20 percent of the
Executive's base salary measured from the beginning of such three-year period;
(iii) on or after a Change in Control, any reduction in the Executive's rate of
base salary as payable from time to time; (iv) a reduction in the Executive's
annual bonus classification level other than in connection with a redesign of
the applicable bonus plan that affects all employees at the Executive's bonus
level; (v) a failure of the Company to continue in effect the benefits
applicable to, or the Company's reduction of the benefits applicable to, the
Executive under any benefit plan or arrangement (including without limitation,
any pension, life insurance, health or disability plan) in which the Executive
participates as of the date of the Change in Control without implementation of a
substitute plan(s) providing materially similar benefits in the aggregate to
those discontinued or reduced, except for a discontinuance of, or reduction
under, any such plan or arrangement that is legally required and/or generally
applies to all executives of the Company of a similar level, provided that in
either such event the Company provides similar benefits (or the economic effect
thereof) to the Executive in any manner determined by the Company; or (vi)
failure of any successor to the Company to assume in writing the obligations
hereunder.
(l) "Salary" shall mean an Executive's base monthly cash compensation
rate for services paid to the Executive by the Company or an Affiliate at the
time of his or her termination of employment from the Control Group. Salary
shall not include commissions, bonuses, overtime pay, incentive compensation,
benefits paid under any qualified plan, any group medical, dental or other
welfare benefit plan, noncash compensation or any other additional compensation
but shall include amounts reduced pursuant to an Executive's salary reduction
agreement under Sections 125 or 401(k) of the Code (if any) or a nonqualified
elective deferred compensation arrangement to the extent that in each such case
the reduction is to base salary.
(m) "Severance Benefit" shall mean (i) in the case of the Executive's
termination of employment that does not occur within the 24 month period
following a Change in Control, two weeks' Salary plus prorated Bonus multiplied
by the Executive's Years of Service, with a minimum of 26 weeks; or (ii) in the
case of an Executive's termination of employment within the 24 month period
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following a Change in Control, two weeks' Salary plus prorated Bonus multiplied
by the Executive's Years of Service, with a minimum of 104 weeks. The
Executive's prorated Bonus for one week shall equal the Executive's Bonus
divided by 52. In no event, however, shall the Severance Benefit payable to an
Executive hereunder be less than 12 months' Salary.
(n) "Severance Period" shall mean (i) in the case of the Executive's
termination of employment that does not occur within the 24 month period
following a Change in Control, two weeks multiplied by the Executive's Years of
Service, with a minimum of 52 weeks; or (ii) in the case of an Executive's
termination of employment within the 24 month period following a Change in
Control, two weeks multiplied by the Executive's Years of Service, with a
minimum of 104 weeks.
(o) "Year of Service" shall mean each 12 consecutive month period
commencing on the Executive's date of hire by the Company or an Affiliate and
each anniversary thereof in which the Executive is paid by the Company or an
Affiliate for the performance of full-time services as an Executive. For
purposes of this section, full-time services shall mean that the Employee is
employed for at least 30 hours per week. A Year of Service shall include any
period during which an Employee is not working due to disability, leave of
absence or layoff so long as he or she is being paid by the Employer (other than
through any employee benefit plan). A Year of Service also shall include service
in any branch of the armed forces of the United States by any person who is an
Executive on the date such service commenced, but only to the extent required by
applicable law.
2. Term. The initial term of this Agreement shall end on December 31 of
the year following the year in which this Agreement is entered into. On December
31 of each year, the term shall be automatically renewed for an additional one
year so that the term shall then be for two years, unless the Committee notifies
the Executive prior to any December 31 that the term shall not be renewed.
Notwithstanding anything in this Agreement to the contrary, if the Company
becomes obligated to make any payment to the Executive pursuant to the terms
hereof at or prior to the expiration of this Agreement, then this Agreement
shall remain in effect until all of the Company's obligations hereunder are
fulfilled.
3. Benefits Upon Termination. In the event the Executive's employment
with the Control Group is terminated without Cause or the Executive terminates
employment with the Control Group within 60 days after the occurrence of a Good
Reason event with regard to the Executive, the Executive shall be entitled to a
Severance Benefit as set forth below.
(a) The Executive shall receive 50 percent of his or her Severance
Benefit in the form of a lump sum cash payment as soon as administratively
feasible following his or her termination of employment with the Control Group,
provided, however, that interest shall be payable beginning on the tenth day
following such termination of employment at the prime rate of interest as stated
in The Wall Street Journal.
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(b) The Executive shall receive the remaining 50 percent of his or her
Severance Benefit in the form of a lump sum cash payment as soon as
administratively feasible following the one year anniversary of the Executive's
termination of employment with the Control Group, subject to (c) below,
provided, however, that interest shall be payable beginning on the tenth day
following such termination of employment at the prime rate of interest as stated
in The Wall Street Journal. Notwithstanding the foregoing, if a Change in
Control occurs prior to the Executive's receipt of the remaining 50 percent of
his or her Severance Benefit, the Executive shall receive such remaining 50
percent within 10 days following the Change in Control (and, if not paid within
such 10 day period, with interest payable beginning on the tenth day following
the Change in Control at the prime rate of interest as stated in The Wall Street
Journal).
(c) The Executive shall only be entitled to the portion of his or her
Severance Benefit described in (b) above if the Executive does not engage in
Competition during the one year period following his or her termination of
employment with the Control Group and if the Executive has not materially
violated the provisions of Section 14 hereof. If the Executive does engage in
Competition or violates the provisions of Section 14 during such one year
period, the portion of the Executive's Severance Benefit described in (b) above
shall be forfeited. If the restriction set forth in this subsection is found by
any court of competent jurisdiction to be unenforceable because it extends for
too long a period of time or over too great a range of activities or in too
broad a geographic area, it shall be interpreted to extend over the maximum
period of time, range of activities or geographic area as to which it may be
enforceable.
(d) Notwithstanding anything to the contrary contained herein, if the
Executive's employment with the Control Group is terminated as described in the
introductory paragraph to this Section 3 following a Change in Control, (i) the
Executive shall receive 100 percent of his or her Severance Benefit in the form
of a lump sum cash payment within 10 days following his or her termination of
employment with the Control Group (and, if not paid within such 10 day period,
with interest payable beginning on the tenth day following such termination of
employment at the prime rate of interest as stated in The Wall Street Journal),
and (ii) the restriction on competition contained in Section 3(c) shall not
apply.
(e) The Executive shall continue, to the extent permitted under legal
and underwriting requirements (if any), to participate during his or her
Severance Period in any group medical, dental or life insurance plan he or she
participated in prior to his or her termination of employment, under
substantially similar terms and conditions as an active Employee; provided
participation in such group medical, dental and life insurance benefits shall
correspondingly cease at such time as the Executive becomes eligible for a
future employer's medical, dental and/or life insurance coverage (or would
become eligible if the Executive did not waive coverage). Notwithstanding the
foregoing, the Executive may not continue to participate in such plans on a
pre-tax or tax-favored basis. Notwithstanding anything else herein, the
Executive shall not be entitled to any benefits during the Severance Period
other than the benefits provided in Section 3 herein and, without limiting the
generality of the foregoing, the Executive specifically shall not be entitled to
continue to participate
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in any group disability or voluntary accidental death or dismemberment insurance
plan he or she participated in prior to his or her termination of employment.
Without limiting the generality of the foregoing, the Executive shall not accrue
additional benefits under any pension plan of the Employer (whether or not
qualified under Section 401(a) of the Code) during the Severance Period,
provided, however, that payment of any Severance Benefit shall be included in
the Executive's earnings for purposes of calculating the Executive's benefit
under the Venator Group Retirement Plan, Venator Group 401(k) Plan, and Venator
Group Excess Cash Balance Plan.
(f) In the event of the Executive's death after becoming eligible for
the portion of the Severance Benefit described in (a) above and prior to payment
of such amount, such portion of the Severance Benefit shall be paid to the
Executive's Beneficiary. In addition to the foregoing, in the event of the
Executive's death prior to payment of the portion of the Severance Benefit
described in (b) above, such amount shall be paid to the Executive's
Beneficiary, but only to the extent that the Executive satisfied the provisions
set forth in (c) above for the period following the Executive's termination of
employment with the Control Group and prior to his or her death.
(g) Notwithstanding anything else herein, to the extent the Executive
would be subject to the excise tax under Section 4999 of the Code on the amounts
in (a) or (b) above and such other amounts or benefits he or she received from
the Company and its Affiliates required to be included in the calculation of
parachute payments for purposes of Sections 280G and 4999 of the Code, the
amounts provided under this Agreement shall be automatically reduced to an
amount one dollar less than that, when combined with such other amounts and
benefits required to be so included, would subject the Executive to the excise
tax under Section 4999 of the Code, if, and only if, the reduced amount received
by the Executive, would be greater than the unreduced amount to be received by
the Executive minus the excise tax payable under Section 4999 of the Code on
such amount and the other amounts and benefits received by the Executive and
required to be included in the calculation of a parachute payment for purposes
of Sections 280G and 4999 of the Code.
4. No Duty to Mitigate/Set-off. The Company agrees that if the
Executive's employment with the Company is terminated during the term of this
Agreement, the Executive shall not be required to seek other employment or to
attempt in any way to reduce any amounts payable to the Executive by the Company
pursuant to this Agreement. Further, except to the extent provided for in
Section 3(c), the amount of the Severance Benefit provided for in this Agreement
shall not be reduced by any compensation earned by the Executive or benefit
provided to the Executive as the result of employment by another employer or
otherwise. Except as otherwise provided herein, the Company's obligations to
make the payments provided for in this Agreement and otherwise to perform its
obligations hereunder shall not be affected by any circumstances, including
without limitation, any set-off, counterclaim, recoupment, defense or other
right which the Company may have against the Executive. The Executive shall
retain any and all rights under all pension plans, welfare plans, equity plans
and other plans, including other severance plans, under which the Executive
would otherwise be entitled to benefits.
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5. Funding. Severance Benefits shall be funded out of the general
assets of the Company as and when they are payable under this Agreement. The
Executive shall be solely a general creditor of the Company. If the Company
decides to establish any advance accrued reserve on its books against the future
expense of benefits payable hereunder, or if the Company is required to fund a
trust under this Agreement, such reserve or trust shall not under any
circumstances be deemed to be an asset of this Agreement.
6. Administration. This Agreement shall be administered by the
Committee. The Committee (or its delegate) shall have the exclusive right,
power, and authority, in its sole and absolute discretion, to administer, apply
and interpret the Agreement and to decide all matters arising in connection with
the operation or administration of the Agreement. Without limiting the
generality of the foregoing, the Committee shall have the sole and absolute
discretionary authority: (a) to take all actions and make all decisions with
respect to the eligibility for, and the amount of, benefits payable under the
Agreement; (b) to formulate, interpret and apply rules, regulations and policies
necessary to administer the Agreement in accordance with its terms; (c) to
decide questions, including legal or factual questions, relating to the
calculation and payment of benefits under the Agreement; (d) to resolve and/or
clarify any ambiguities, inconsistencies and omissions arising under the
Agreement; (e) to decide for purposes of paying benefits hereunder, whether,
based on the terms of this Agreement, a termination of employment is for Good
Reason or for Cause; and (f) except as specifically provided to the contrary
herein, to process and approve or deny benefit claims and rule on any benefit
exclusions. All determinations made by the Committee (or any delegate) with
respect to any matter arising under the Agreement shall be final, binding and
conclusive on all parties.
Decisions of the Committee shall be made by a majority of its members
attending a meeting at which a quorum is present (which meeting may be held
telephonically), or by written action in accordance with applicable law. All
decisions of the Committee on any question concerning the interpretation and
administration of the Agreement shall be final, conclusive and binding upon all
parties.
No member of the Committee and no officer, director or employee of the
Company or any other Affiliate shall be liable for any action or inaction with
respect to his or her functions under this Agreement unless such action or
inaction is adjudged to be due to gross negligence, willful misconduct or fraud.
Further, no such person shall be personally liable merely by virtue of any
instrument executed by him or her or on his or her behalf in connection with
this Agreement.
The Company shall indemnify, to the full extent permitted by law and
its Certificate of Incorporation and By-laws (but only to the extent not covered
by insurance) its officers and directors (and any employee involved in carrying
out the functions of the Company under the Agreement) and each member of the
Committee against any expenses, including amounts paid in settlement of a
liability, which are reasonably incurred in connection with any legal action to
which such person is a party by reason of his or her duties or responsibilities
with respect to the Agreement, except with regard to matters as to which he or
she shall be adjudged in such action to be liable for gross negligence, willful
misconduct or fraud in the performance of his or her duties.
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7. Claims Procedures. Any claim by the Executive or Beneficiary
("Claimant") with respect to participation, contributions, benefits or other
aspects of the operation of the Agreement shall be made in writing to the
Secretary of the Company or such other person designated by the Committee from
time to time for such purpose. If the designated person receiving a claim
believes, following consultation with the Chairman of the Committee, that the
claim should be denied, he or she shall notify the Claimant in writing of the
denial of the claim within 90 days after his or her receipt thereof (this period
may be extended an additional 90 days in special circumstances and, in such
event, the Claimant shall be notified in writing of the extension). Such notice
shall (a) set forth the specific reason or reasons for the denial making
reference to the pertinent provisions of the Agreement on which the denial is
based, (b) describe any additional material or information necessary to perfect
the claim, and explain why such material or information, if any, is necessary,
and (c) inform the Claimant of his or her right pursuant to this section to
request review of the decision.
A Claimant may appeal the denial of a claim by submitting a written
request for review to the Committee, within 60 days after the date on which such
denial is received. Such period may be extended by the Committee for good cause
shown. The claim will then be reviewed by the Committee. A Claimant or his or
her duly authorized representative may discuss any issues relevant to the claim,
may review pertinent documents and may submit issues and comments in writing. If
the Committee deems it appropriate, it may hold a hearing as to a claim. If a
hearing is held, the Claimant shall be entitled to be represented by counsel.
The Committee shall decide whether or not to grant the claim within 60 days
after receipt of the request for review, but this period may be extended by the
Committee for up to an additional 60 days in special circumstances. Written
notice of any such special circumstances shall be sent to the Claimant. Any
claim not decided upon in the required time period shall be deemed denied. All
interpretations, determinations and decisions of the Committee with respect to
any claim shall be made in its sole discretion based on the Agreement and other
relevant documents and shall be final, conclusive and binding on all persons.
8. Incompetency; Payments to Minors. In the event that the Committee
finds that a Participant is unable to care for his or her affairs because of
illness or accident, then benefits payable hereunder, unless claim has been made
therefor by a duly appointed guardian, committee, or other legal representative,
may be paid in such manner as the Committee shall determine, and the application
thereof shall be a complete discharge of all liability for any payments or
benefits to which such Participant was or would have been otherwise entitled
under this Agreement. Any payments to a minor pursuant to this Agreement may be
paid by the Committee in its sole and absolute discretion (a) directly to such
minor; (b) to the legal or natural guardian of such minor; or (c) to any other
person, whether or not appointed guardian of the minor, who shall have the care
and custody of such minor. The receipt by such individual shall be a complete
discharge of all liability under the Agreement therefor.
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9. Withholding. The Company shall have the right to make such
provisions as it deems necessary or appropriate to satisfy any obligations it
may have to withhold federal, state or local income or other taxes incurred by
reason of payments pursuant to this Agreement. In lieu thereof, the Employer
shall have the right to withhold the amount of such taxes from any other sums
due or to become due from the Employer to the Executive upon such terms and
conditions as the Committee may prescribe.
10. Assignment and Alienation. Except as provided herein, the benefits
payable under this Agreement shall not be subject to alienation, transfer,
assignment, garnishment, execution or levy of any kind, and any attempt to cause
any benefits to be so subjected shall not be recognized.
11. Successors; Binding Agreement. In addition to any obligations
imposed by law upon any successor to the Company, the Company will require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Company to expressly assume and agree in writing to perform this Agreement in
the same manner and to the same extent that the Company would be required to
perform it if no such succession had taken place. This Agreement shall inure to
the benefit of and be enforceable by the Executive's personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If the Executive shall die while any amount would still
be payable to the Executive hereunder if the Executive had continued to live,
all such amounts, unless otherwise provided herein, shall be paid in accordance
with the terms of this Agreement to the Executive's Beneficiary, or the
executors, personal representatives or administrators of the Executive's estate.
12. Miscellaneous. No provisions of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by the Executive and such officer as may be specifically
designated by the Board. No waiver by either party hereto at any time of any
breach by the other party hereto of, or compliance with, any condition or
provision shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. No agreements or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not expressly set
forth in this Agreement. All references to sections of the Code or any other law
shall be deemed also to refer to any successor provisions to such sections and
laws.
13. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
14. Confidentiality. The Executive shall not at any time during the
term of this Agreement, or thereafter, communicate or disclose to any
unauthorized person, or use for the Executive's own account, without the prior
written consent of the Board, any proprietary processes, or other confidential
information of the Company or any subsidiary concerning their business or
affairs, accounts or customers, it being understood, however, that the
obligations of this section shall not
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apply to the extent that the aforesaid matters (a) are disclosed in
circumstances in which the Executive is legally required to do so, or (b) become
generally known to and available for use by the public other than by the
Executive's wrongful act or omission.
15. Severability. If any provisions of this Agreement shall be declared
to be invalid or unenforceable, in whole or in part, such invalidity or
unenforceability shall not affect the remaining provisions hereof which shall
remain in full force and effect.
16. Arbitration. Any dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration,
conducted before a panel of three arbitrators in New York, New York, or in such
other city in which the Executive is then located, in accordance with the rules
of the American Arbitration Association then in effect. The determination of the
arbitrators, which shall be based upon a de novo interpretation of this
Agreement, shall be final and binding and judgment may be entered on the
arbitrators' award in any court having jurisdiction. The Company shall pay all
costs of the American Arbitration Association and the arbitrator.
17. Non-Exclusivity of Rights. Nothing in this Agreement shall prevent
or limit the Executive's continuing or future participation in any benefit,
bonus, incentive or other plan or program provided by the Company or any of its
subsidiary companies and for which the Executive may qualify.
18. Governing Law. This Agreement shall be construed, interpreted, and
governed by the Employee Retirement Income Security Act of 1974, as amended. To
the extent not so governed, it shall be governed by the laws of the State of New
York (without reference to rules relating to conflicts of law).
19. Top-hat Plan. This Agreement is intended to be a "top-hat" welfare
plan within the meaning of Department of Labor Regulation Section 2520.104-24.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed and the Executive's hand has hereunto been set as of the date first set
forth above.
VENATOR GROUP, INC.
By: /s/ Xxxx X. Xxxxxx
-------------------
/s/ Xxxx X. Xxxxxxxxx
---------------------
Xxxx X. Xxxxxxxxx
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APPENDIX A
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Change in Control
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A Change in Control shall mean any of the following: (i) (A) the making
of a tender or exchange offer by any person or entity or group of associated
persons or entities (within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934 (a "Person") (other than the Company or its
Affiliates) for shares of common stock of the Company pursuant to which
purchases are made of securities representing at least twenty percent (20%) of
the total combined voting power of the Company's then issued and outstanding
voting securities; (B) the merger or consolidation of the Company with, or the
sale or disposition of all or substantially all of the assets of the Company to,
any Person other than (a) a merger or consolidation which would result in the
voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving or parent entity) fifty percent (50%) or
more of the combined voting power of the voting securities of the Company or
such surviving or parent entity outstanding immediately after such merger or
consolidation; or (b) a merger or capitalization effected to implement a
recapitalization of the Company (or similar transaction) in which no Person is
or becomes the beneficial owner, directly or indirectly (as determined under
Rule 13d-3 promulgated under the Securities Exchange Act of 1934), of securities
representing more than the amounts set forth in (C) below; (C) the acquisition
of direct or indirect beneficial ownership (as determined under Rule 13d-3
promulgated under the Securities Exchange Act of 1934), in the aggregate, of
securities of the Company representing twenty percent (20%) or more of the total
combined voting power of the Company's then issued and outstanding voting
securities by any Person acting in concert as of the date of this Agreement;
provided, however, that the Board may at any time and from time to time and in
the sole discretion of the Board, as the case may be, increase the voting
security ownership percentage threshold of this item (C) to an amount not
exceeding forty percent (40%); or (D) the approval by the shareholders of the
Company of any plan or proposal for the complete liquidation or dissolution of
the Company or for the sale of all or substantially all of the assets of the
Company; or (ii) during any period of not more than two (2) consecutive years,
individuals who at the beginning of such period constitute the Board, and any
new director (other than a director designated by a person who has entered into
agreement with the Company to effect a transaction described in clause (i))
whose election by the Board or nomination for election by the Company's
stockholders was approved by a vote of at least two-thirds ( ) of the directors
then still in office who either were directors at the beginning of the period or
whose election or nomination for election was previously so approved, cease for
any reason to constitute at least a majority thereof.
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ATTACHMENT B
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July 2, 1999
Board of Directors
Venator Group, Inc.
000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen:
I hereby resign my position as Senior Vice President - Human Resources
of Venator Group, Inc. (the "Company"), and from any other position as an
officer or director that I may hold with the Company or with any subsidiary or
affiliate thereof, effective at the close of business on July 2, 1999.
Yours truly,
