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EXHIBIT 10.24
October 21, 1996
EMPLOYMENT AGREEMENT
This Agreement dated as of October 21, 1996 by and between Xxxx Xxxxxxx
("Employee"), and CROWN BOOKS CORPORATION, a Delaware corporation ("Employer").
W I T N E S S E T H:
WHEREAS, the parties hereto desire by this Agreement to provide for the
employment of Employee by Employer;
NOW THEREFORE, in consideration of the mutual covenants and agreements
contained in this Agreement, and other good and valuable consideration, the
receipt, sufficiency and adequacy of which the parties conclusively
acknowledge, the parties hereto, intending to be legally bound, agree as
follows:
1. EMPLOYMENT
(a) Duties. Employer hereby employs Employee, and Employee accepts
employment by Employer, as Vice President, Real Estate during the Employment
period (as defined in Section 2), with such duties, responsibilities and
authority as are commensurate with and appropriate to such position and as are
from time to time set forth in the bylaws of the Employer and otherwise
delegated to him or her by the Board of Directors of the Employer ("the Board
of Directors"), and shall report to the Executive Committee of the Board, the
Board of Directors, or other Senior Executive as directed by the Board.
Employee agrees to observe and comply with the rules and regulations of
Employer as adopted by the Board of Directors respecting the performance of his
or her duties and to carry out and follow the orders, policies and directions
stated by Employer to him or her from time to time, provided, however, that
such regulations and directions are consistent with the authority and
responsibility of the position specified above.
(b) Full Time Employment. During the Employment period Employee
shall devote all his or her time and attention to his services for Employer and
shall diligently perform his or her duties and responsibilities under this
Agreement. Employee acknowledges that the proper performance of his or her
duties and responsibilities may require the rendering of services not only
during normal business hours, but over and beyond those hours as well.
(c) Place of Employment and Travel. Employee's principal place of
employment shall be at the executive offices of Employer in Landover, Maryland.
If Employer's executive offices are moved from Landover, Maryland, Employee's
principal place of employment shall be changed to the location where such
executive offices are moved. Employee agrees to travel for the performance of
his or her duties under this Agreement as Employer may request from time to
time. If Employers executive offices are relocated a distance greater than 100
miles from Landover, Maryland, Employee's relocation expenses will be paid by
Employer if Employee elects to relocate. At the
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Employee's option, if Employee decides not to relocate, the relocation of the
executive offices will be deemed a termination without cause and the Employee
will be eligible to receive severance benefits as outlined in Section 7 (e) of
this Agreement.
2. TERM
The term of Employee's employment under this Agreement (the
"Employment Period") shall commence on October 28, 1996 and end on October 28,
1997. If the Employer decides not to renew this Agreement, notice will be
delivered in writing at least 30 days prior to the end of the term of this
Agreement. If such notice is not delivered then the Agreement will continue for
an additional one (1) year after which it will automatically expire, unless it
is renewed.
3. COMPENSATION
(a) Base Salary. Employee's annual base salary shall be One Hundred
Thirty Thousand Dollars ($130,000.00), subject to an annual increase as
recommended to the Board of Directors by the Compensation Committee of the
Board of Directors following review and performance appraisal of Employee, and
following approval by the Board of Directors. Employee's base salary shall be
paid in accordance with Employer's normal payroll procedure.
(b) Bonus. A bonus of 30% of base salary. Any payments made will be
based on the components of your bonus program. This bonus payment is subject to
approval by the Board of Directors. Receipt of this bonus is subject to your
active employment at Crown Books Corporation at the time of bonus payments.
This bonus is not payable if Employee has been, or is being terminated pursuant
to Section 7. The bonus program including the amount of bonus may be changed or
deleted by the Board of Directors.
(c) Withholding Tax. All compensation shall be subject to the
customary withholding tax and other employment taxes as required with respect
to compensation paid by a corporation to an employee.
4. STOCK OPTIONS
(a) Stock Options. Employee shall be eligible for the annual award
of stock options pursuant to the stock option plans under which the Employee is
currently a participant, as determined by the Board(s) of Directors of the
company(s), pursuant to the individual company(s) stock option plan(s).
(b) Exercise upon Certain Terminations of Employment. In the event
of the termination of Employee's employment hereunder for any reason other than
pursuant to Section 7 (d), Employee shall have the right to exercise, on or
before the effective date of the termination of this Agreement, any option
which has vested in Employee hereunder coincident with or prior to the
effective date of the termination of Employee's employment hereunder, subject
to the other terms and conditions of
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such option plan(s). In addition, in the event of the termination of Employee's
employment due to his or her death, the personal representative of the Employee
shall have the right to exercise any such option within the later of (i) thirty
(30) days notice of such right by Employer to Employee's personal
representative or (ii) sixty (60) days of the date of Employee's death.
5. EMPLOYEE BENEFITS
During the Employment Period, Employer shall provide Employee with
the following benefits:
(a) Health Plan Coverage. Employer shall provide Employee with
health benefits, including major medical health insurance and Long Term
Disability (LTD), Accidental Death and Dismemberment (AD&D) and such other
benefits that are in effect at the time of this Agreement for the Employee and
his or her immediate family all in accordance with Employer's "Executive Health
Plan" as now in effect.
(b) Further Benefits. Employee shall, during the term of this
Agreement (and thereafter to the extent provided herein), be eligible to
participate in all applicable profit sharing and 401 (k) plans and insurance
benefits in effect for all salaried employees of the Employer, together with
any future improvements in such plans or benefits, subject to the eligibility
requirements of such plans. In addition, Employee shall be entitled during the
term of this Agreement, and thereafter to the extent provided for herein or in
any such plan, to receive such other and further benefits as shall be generally
made applicable to key executive employees of the Employer, and such additional
benefits, as may be granted from time-to-time by the Board of Directors, in
it's sole discretion.
(c) Vacation. Employee shall be entitled to paid vacation leave of
three (3) weeks in every year of employment, increased pursuant to Employer's
vacation plan. Effective with this Agreement, all vacation earned subsequent to
the date of this Agreement shall be taken no later than by the end of the
following year or be forfeited, unless prior approval is granted by the
Compensation Committee of the Board of Directors.
(d) Business Expenses. Employer shall reimburse Employee pursuant to
Employer's policy of employee expense reimbursement of all items of travel,
entertainment and miscellaneous expenses reasonably incurred by Employee on
behalf of Employer and presented to Employer on the appropriate voucher.
(e) Automobile Allowance: Employer shall pay to Employee as an
automobile allowance the sum of Six Hundred Fifty Dollars ($650.00) per month.
6. PROPRIETARY DATA
(a) Trade Secrets and Other Confidential Information. During the
Employment Period and for three (3) years thereafter, Employee shall keep
confidential any data, documents, or financial
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or other information of a trade secret or confidential nature relating to
Employer's past, present or future operations (the "Proprietary Data"), shall
not disclose the Proprietary Data to any third parties other than officers,
employees or agents of Employer on a "need to know" basis, shall take all
necessary steps to ensure that such officers, employees or agents keep such
Proprietary Data confidential, and shall use the Proprietary Data only in
connection with rendering services to Employer. Upon the end of the Employment
Period, Employee shall promptly return to Employer the originals and all copies
of the Proprietary Data in the possession of Employee, and shall not use any of
the Proprietary Data for his or her own benefit or for the benefit of any third
parties. The covenants contained in this Section 6 (a) shall not apply to
Proprietary Data which is or becomes a matter of general knowledge in the
industry otherwise than by a breach of the provisions of this Section 6 (a).
(b) Injunctive Relief. Employee acknowledges that the covenants
contained in Sections 6 (a) are necessary for the protection of the legitimate
business interests of Employer and are reasonable limitations of activities,
that the rights of Employer are of a specialized and unique character, and that
immediate and irreparable damage will result to Employer if Employee fails to
or refuses to perform or comply with such covenants. Therefore, notwithstanding
any election by Employer to claim damages from Employee as a result of any such
failure or refusal, Employer may, in addition to any other remedies and damages
available, seek an injunction in a court of competent jurisdiction to restrain
any such failure or refusal (and no bond or other security shall be required in
connection therewith). In that connection, Employee represents and warrants
that his or her expertise and capabilities are such that performance or
compliance with the covenants (and the enforcement thereof by injunction or
otherwise) will not prevent him or her from earning a livelihood. If a court
refuses to enforce the covenants set forth in Section 6 (a) because they are
found to be unreasonable, Employee and Employer agree to abide by any lesser
restrictions (for instance, as to duration and geographic area) that are found
to be reasonable.
7. TERMINATION
(a) Definition of Compensation: For purposes of termination,
compensation at the time of termination shall be deemed to include accrued sick
and vacation and salary through the effective date of termination, plus any and
all benefits normally granted by Employer to Employees upon termination.
(b) Death. The Employment Period shall forthwith terminate upon the
death of Employee, whereupon Employer shall not have any further obligations or
liability hereunder except to pay the Employee's estate the unpaid portion, if
any, of Employee's compensation accrued for the period up to the date of
Employee's death.
(c) Total Disability. In the event of the Total Disability (as that
term is hereafter defined) of Employee for a period of four (4) consecutive
calendar months, or for eighty percent (80%) or more of the normal working days
during a period of six (6) consecutive full calendar months, Employer shall
have the right to end the Employment Period by giving Employee ten (10) days'
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written notice. Upon the expiration of such ten (10) day period, the Employment
Period shall end and Employer shall not have any further obligations hereunder
except to pay Employee the unpaid portion, if any, of Employee's compensation
accrued for the period up to the date of termination of Employee's employment.
As used in this Agreement, the term "Total Disability" shall mean a mental or
physical condition which, in the opinion of Employer and in the opinion of two
consulting physicians, renders Employee unable or incompetent to carry out his
obligations hereunder, provided, however that said disability must also be in
accordance with disability as defined in the Company's Long Term Disability
coverage and, therefore, Employee shall be eligible for such Long Term
Disability coverage.
(d) With Cause. Employer shall have the right to immediately
terminate the employment of Employee at any time for just cause. For purposes
of the foregoing, "just cause" shall include, but not be limited to: (i)
Employee's commission of any act which constitutes an offense involving moral
turpitude under federal, state or local law; (ii) Employee's material breach of
any of the terms of this Agreement; (iii) Employee's refusal to follow lawful
and reasonable directive(s) of the Board of Directors made in compliance with
Section 1(a) hereof; or (iv) Documented performance problems. Upon such
termination, Employer shall have no further obligations or liability hereunder
except to pay Employee the unpaid portion, if any, of Employee's compensation
accrued for the period up to the date of termination of Employee's employment.
(e) Dissatisfaction by Employer Without Cause. Employer shall have
the right to terminate the employment of Employee without cause upon at least
thirty (30) days written notice to Employee. If Employer shall terminate the
employment of Employee pursuant to this Section 7 (e), the Employment Period
shall end at the expiration of the notice period and Employer shall not have
any further obligations or liability hereunder except (i) to pay Employee the
unpaid portion, if any, of Employee's compensation accrued for the period up to
the date of termination of Employee's employment, together with an additional
lump sum amount of one (1) year of base salary as severance (ii) to pay to
Employee in a lump sum an amount equal to the number of days of accrued and
unused vacation and sick leave times the Employee's base salary in effect on
the date of termination. If new employment (defined as employment for another
company, or self- employment) for the Employee commences at any time during the
severance period and the base salary is the same or more than that paid by the
Employer then Employee shall return the balance (the difference between the
date of new employment and the end of the severance period) of the severance
monies to the Employer. If the base salary is less than that paid by the
Employer then the Employer shall reduce the severance payments to the equal
difference between the new base salary and that paid by the Employer. Employee
must notify Employer immediately upon starting new employment. Employer shall
offer health insurance continuation under COBRA. Lastly, Employee shall be
entitled to utilize the services of a professional out placement service, the
reasonable cost of which shall be borne by Employer.
(f) Dissatisfaction by Employee. If Employee at any time is for any
reason dissatisfied with the terms and conditions of his or her employment
hereunder, Employee shall have the right to terminate his or her employment
upon at least thirty (30) days written notice to Employer. If
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Employee shall terminate his or her employment pursuant to this Section 7 (f),
the Employment Period shall end at the expiration of the notice period and
Employer shall have no further obligations or liability hereunder except to pay
to Employee the unpaid portion, if any, of Employee's compensation accrued for
the period up to the date of termination. If Employee gives thirty (30) days
written notice due solely to Employer's decision not to renew this Agreement as
set forth in Section 2, or Employee's dissatisfaction with the terms of a new
Agreement, then the Employee will be eligible for the severance terms outlined
in Section 7(e). Such written notice must be given no later than the 30th day
after the termination or expiration of the Agreement outlined in Section 2. If
Employee does not give written notice to the Employer within said thirty (30)
day period then Employee understands and acknowledges that he or she will not
be eligible to receive the severance and other benefits outlined in Section
7(e) and agrees that if he or she continues to be employed, his or her
employment will be at-will and for no definite or determinable period and may
be terminated at any time, with or without notice, at the option of the
Employee or the Company.
8. MISCELLANEOUS
(a) Governing Law. This Agreement shall be governed by the laws of
the State of Delaware applicable to agreements made by and to be performed by
Delaware corporations.
(b) Amendment of Agreement. No amendment or variation of the terms
of this Agreement, with or without consideration, shall be valid unless made in
writing and signed by the Employee and a duly authorized representative of the
Employer (other than Employee).
(c) Waiver of Conditions. Any waiver agreed to between Employer and
Employee of any provision should not be construed as a general waiver of the
provision, or waiver of any other provision of this Agreement.
(d) Entire Agreement. This Agreement contains the entire agreement
between then parties and supersedes all prior oral and written agreements,
understandings, commitments, and practices between the parties, whether or not
fully performed by Employee before the date of this Agreement.
(e) Headings. The section headings of this Agreement are for
reference purposes only and are to be given no effect in the construction or
interpretation of this Agreement.
(f) Notice. All notices, requests and other communications under
this Agreement shall be in writing and shall be deemed given when delivered
personally or upon receipt when sent by an express mail service, provided that
in each case a copy is mailed by first-class, registered mail, return receipt
requested, addressed as follows (or as may otherwise have been specified by the
intended recipient by notice as herein provided)
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If to Employee:
Xxxx Xxxxxxx
0000 X.X. 00xx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
If to Employer:
Chief Executive Officer
Crown Books Corporation
0000 00xx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
(g) Severability. If any provision of this Agreement is held invalid
or unenforceable, the remainder of this Agreement shall nevertheless remain in
full force and effect. If any provision is held invalid or unenforceable with
respect to particular circumstances, it shall nevertheless remain in full force
and effect in all other circumstances.
(h) Merger or Consolidation. This Agreement shall not be terminated
by any merger, consolidation, transfer of any or all of the assets of the
Employer or voluntary or involuntary dissolution of the Employer. In the event
of a merger or consolidation or upon the transfer of assets, the surviving or
resulting corporation or the transferee of the Employer's assets shall be bound
by and shall have the benefit of the provisions of this Agreement, and the
Employer shall take all actions necessary to ensure that such corporation or
transferee is bound by the provisions of this Agreement. This Agreement shall
be binding upon the Employer notwithstanding any change in the composition of
the Board of Directors or change in ownership of the Employer.
(i) No Covenants. Employee hereby represents and warrants that he or
she is not subject to or bound by any employment contract, restrictive covenant
or other agreement or any order or decree that prevents him or her from
entering into this Agreement or from performing his or her responsibilities as
contemplated by this Agreement.
(j) Attorney's Fees. If a dispute arises with respect to the
Employer's obligations or the Employee's rights under this Agreement, or if any
legal proceedings shall be brought to enforce or interpret any provisions
contained herein, or to recover damages for breach hereof, or in the event of
any other litigation involving this Agreement, Employee shall recover from the
Employer all reasonable attorney's fees and costs and disbursements incurred as
a result of such dispute. In addition, Employee shall recover from Employer all
reasonable attorney's fees and costs and disbursements incurred as a result of
any legal proceeding filed by Employee, unless the Employee's
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pursuit of legal proceedings is deemed frivolous or in bad faith as determined
by the court in any such action.
(k) Assignment; Binding Effect. This Agreement shall be binding
upon, and shall inure to the benefit of, and be enforceable by , the parties
hereto and their respective successors and assigns, provided, that (I) this
Agreement is a personal service agreement and no right hereunder may be
assigned by Employee, except that it shall inure to the benefit of and be
enforceable by the Employee's personal or legal representatives, executors or
administrators; and (ii) unless Employer shall have complied with Section 8 (h)
hereof, no right hereunder may be assigned or transferred by Employer by
operation of law or otherwise. Any purported assignment or transfer in
violation of this Section 8 (k) shall be null and void.
IN WITNESS WHEREOF, this Agreement has been signed by a duly authorized officer
of Employer and by Employee as of the date first above-written.
CROWN BOOKS CORPORATION
/s/ XXXXX XXXXXXX October 21, 1996
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Xxxxx Xxxxxxx Date
President and Chief Executive Officer
/s/ XXXX XXXXXXXX October 21, 1996
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Xxxx Xxxxxxxx Date
Assistant Vice President
Human Resources
EMPLOYEE
/s/ XXXX XXXXXXX October 21, 1996
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Xxxx Xxxxxxx Date
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