1
EXHIBIT 10
November 11, 1996
Xx. Xxxx X. Xxxxxxx
0 Xxxxxxxx Xxxxx
Xxxxxxx, Xxx Xxxxxx 00000
Dear Xxxx:
This letter sets forth our understanding and agreement with respect to
your resignation as Vice President and Controller of Woolworth Corporation
("Woolworth"), effective on the Termination Date, as hereinafter defined, and
sets forth the arrangements to which we have agreed.
1. Termination of Employment. Your employment with the Company shall
continue until the date specified by the Company in a written notice to you,
which date is expected to be 30 days following the date on which your successor
commences employment with the Company (the date of termination of your
employment being herein referred to as the "Termination Date"). You shall resign
as Vice President and Controller of the Company, and from all other positions
you hold with the Company or any of its subsidiaries, as of the date the Company
delivers to you the notice referred to in the preceding sentence and you shall
execute and deliver a letter of resignation in the form annexed hereto as
Exhibit A 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, including cooperating in the transfer of your responsibilities to
your successor, the Company shall make the following payments to you:
a. On the Termination Date, $7,115, being the amount payable to you
pursuant to the provisions of the Company's severance policy.
b. On the Termination Date, an additional amount of $39,135.
c. 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.
d. Provided that the Termination Date is earlier than March 8, 1997, on
the Termination Date, an amount equal to the difference between the fair market
value of one share of the Company's Common Stock on the trading day preceding
the Termination Date and $15.375, multiplied by 5,000 and the stock option
granted to you on March 8, 1995 shall thereupon be cancelled. For purposes of
2
2
the preceding sentence, the "fair market value" of a share of the Company's
Common Stock shall be the average of the high and the low prices at which such
Common Stock traded on the New York Stock Exchange on the relevant trading day.
e. If you have not commenced other full-time employment on the date
three months' from the Termination Date, the Company shall, for the one-month
period commencing on such date, and in each of the 11 monthly periods
thereafter, pay you $15,417, provided, however, that (i) during the period that
such payments are being made, you must, in the opinion of an out-placement
counselor designated by the Company, be actively engaged in a search for
full-time employment and (ii) the Company shall have no obligation to continue
such payments, and such payments shall cease, on the date you commence other
full-time employment.
f. You shall be eligible to receive a payment under the Company's
Annual Incentive Compensation Plan for 1996 and the Long-Term Incentive
Compensation Plan for the 1994-96 plan period in accordance with the terms of
those plans; provided, however, that if the Date of Termination is earlier than
January 26, 1997, such payments, if any, shall be prorated as of the Termination
Date. You shall not be entitled to receive any payment under the Annual
Incentive Compensation Plan for 1997 or under the Long-Term Incentive
Compensation Plan for any other period.
g. 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. 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 Woolworth
Stock Option and Award Plan (the "Option Plan"), shall remain exercisable in
accordance with the relevant provisions of the Option Plan. Your "effective date
of termination" for purposes of the Option Plan shall be the Termination Date
and your termination shall, for the purposes of such plan, be treated as your
resignation from your position with the Company.
Your right to participate in the 1994 Woolworth 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. For purposes of calculating your benefit accrual
under the Woolworth Retirement Plan and the Excess Cash Balance Plan for the
plan year in which the Termination Date occurs, your W-2 Compensation (as that
term is defined in such plans) shall include the amounts payable to you under
the provisions of Sections 2(a) and 2(b) hereof.
5. Other Benefits. (a) Your participation in the medical, drug, dental,
life insurance, and voluntary accidental death and dismemberment plans for
active employees of the Company shall cease on the Termination Date, subject to
your right to continue coverage under the provisions of COBRA. In the event that
you elect to continue such coverage under the provisions of COBRA, the Company
shall make on your behalf any additional premium payments beyond those you would
be required to
3
3
make if you were a full-time employee of the Company for the period ending on
the earlier of the first anniversary of the Termination Date or 30 days
following the date on which you commence other full-time employment.
(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.
6. Confidentiality. You will not disclose, at any time, to any person,
nonpublic information of any kind concerning the Company or any of its
subsidiaries, including, but not limited to, nonpublic information concerning
finances, financial plans, accounting methods, strategic plans, operations,
personnel, organizational structure, methods of distribution, suppliers,
customers, client relationships, marketing strategies, or the like.
If you engage in such wrongful conduct or otherwise violate the
provisions of this Section 6, you will forfeit your entitlement to any rights
granted by this letter agreement (except as otherwise provided under applicable
law) and the Company shall not have any further obligation under this letter
agreement. In addition, you agree that the Company shall have such other rights,
including but not limited to injunctive relief, as may be provided under
applicable law.
7. Release from Claims. In consideration of all of the foregoing, you
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, 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, 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). In addition, federal law also provides that you have 21 days from the
date of this letter, 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 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.
4
4
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 represents our total
understanding and agreement with regard to the subject matter hereof, and
supersedes 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
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.
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,
WOOLWORTH CORPORATION
By:/s/ Xxxxxxxx X. Xxxx
Agreed: ----------------------------
/s/ Xxxx X. Xxxxxxx
-----------------------------
Xxxx X. Xxxxxxx
Witnessed:
/s/ Xxxx X. Xxxxxxxxx
-----------------------------
Date: 12/9/96
------------------------
5
5
EXHIBIT A
__________________, 19__
Board of Directors
Woolworth Corporation
000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen and Ladies:
I hereby resign my position as Vice President and Controller of
Woolworth Corporation, and from any other position as an officer or director
that I may hold with Woolworth Corporation or with any subsidiary or affiliate
thereof, effective at the close of business on [DATE OF NOTICE].
Yours truly,
Xxxx X. Xxxxxxx
