Exhibit 10.1
CONSULTING AND NONCOMPETITION AGREEMENT
This Agreement is made as of the 4th day of February, 2001 by and
between The Bon-Ton Department Stores, Inc., a Pennsylvania corporation (the
"Company"), and XXXX X. XXXXX ("Xxxxx").
BACKGROUND
The Company desires to retain Starr as a consultant and Starr desires
to provide consulting services to the Company, and the Company desires to secure
Starr's agreement not to engage in competition with the Company, all in
accordance with the terms and conditions of this Agreement.
NOW, THEREFORE, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. Services. The Company hereby engages Starr as a consultant
and Starr hereby agrees to provide such consulting services for the
Company when and as requested by the Board of Directors, the Chairman
of the Board or another executive officer of the Company. Starr shall
be entitled to render such consulting services by telephone, telecopy
or other practical means. Through the term of this Agreement, Starr
will devote his energy, skill and best efforts to the performance of
his duties in a manner which will faithfully and diligently further the
business interests of the Company. However, the Company acknowledges
that Starr may provide consulting services to others, provided that
Starr makes himself reasonably available to fulfill his obligations
hereunder and does not violate the provisions of Section 7 of this
Agreement.
2. Term. Starr shall perform consulting services hereunder for
a term commencing February 4, 2001 and shall continue until the earlier
of (a) termination by either party on written notice to the other, or
(b) Starr's death.
3. Payment for Services. As full and complete compensation for
any and all consulting services that Starr renders to the Company, the
Company shall pay Starr $65,000.00 per year, payable in equal monthly
installments on the first day of each month,
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which payments shall commence on February 4, 2001 and continue to and
until the termination of the consulting services to be provided by
Starr under this Agreement, provided, however, that if Starr shall be
in breach of his obligations under Section 7 of this Agreement, such
payments shall immediately cease. Thereafter, so long as Starr is not
in breach of his obligations under Section 7 and in consideration of
Starr's agreement contained in Section 7(a), the Company will pay Starr
$65,000 per year, payable in equal monthly installments on the first
day of each month, commencing on termination of Starr's consulting
services and continuing for 37 months. Such payments shall be made to
Starr or, in the event of his death, to his estate.
4. Business Expenses. Starr will be entitled to be reimbursed
for reasonable out-of-pocket business expenses he incurs while
performing services on behalf of the Company pursuant to this
Agreement, provided that such business expenses have been authorized in
advance by the Chairman of the Board. The Company will not provide any
fringe benefits of any type to Starr.
5. Independent Contractor. The parties acknowledge that it is
their intention that Starr is and shall be an independent contractor
and not an employee of the Company. Starr agrees that he will not
represent himself to be an employee of the Company or an authorized
agent of the Company.
6. Company Property. All advertising, sales, manufacturer's
and other materials or articles of information, including without
limitation data processing reports, customer sales analyses, invoices,
price lists or information, samples, or any other materials or data of
any kind furnished to Starr by the Company or developed by Starr on
behalf of the Company or at the Company's direction or for the
Company's use or otherwise in connection with Starr's services
hereunder, are and shall remain the sole and confidential property of
the Company; if the Company requests the return of such materials at
any time during or at or after the termination of this Agreement, Starr
shall immediately deliver the same to Company.
7. Non-Competition, Trade Secrets, Etc.
a) Starr agrees that, at any time during or within three years
after the end of Starr's performance of consulting services under this
Agreement, Starr shall not, directly or indirectly, (i) solicit,
induce, encourage or attempt to influence any client, customer,
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employee, consultant, independent contractor, salesman or supplier of
the Company to cease to do business or terminate his or her employment
with the Company or (ii) engage in (as a principal, agent, consultant,
partner, director, officer, employee, stockholder, investor, owner,
independent contractor or otherwise), alone or in association with any
person or entity, or be financially interested in or otherwise be
connected with, any business operating within 50 miles of any of the
department stores currently operated by the Company (the "Department
Stores"), the primary business of which would be in competition with
the business of any of such Department Stores. However, nothing
contained in this Section 7(a) shall prevent Starr from holding for
investment no more than 5% of any class of equity securities of a
company whose securities are publicly traded.
b) Starr shall not, at any time during or following the term
of this Agreement, use for his personal benefit, or disclose,
communicate or divulge to or use for the direct or indirect benefit of
any person, firm, association or company, any confidential information
regarding the business methods, business policies, procedures,
techniques, research or development projects or results, trade secrets
or other confidential knowledge or processes of or developed by the
Company or any names and addresses of customers or clients or any data
on or relating to past, present or prospective customers or clients or
any other confidential information relating to or dealing with the
business operations or activities of the Company. The confidentiality
obligations of this Section 7(b) shall not apply to information: (i)
which Starr is compelled to disclose by judicial or administrative
process, or other mandatory requirements of law; (ii) which can be
shown to have been generally available to the public other than as a
result of a breach of this Section; or (iii) which can be shown to have
been provided to Starr by a third party who obtained such information
other than as a result of breaching an obligation of confidentiality.
c) Starr acknowledges and agrees that (i) the covenants set
forth herein are reasonable and necessary in order to protect the
legitimate interests of the Company; (ii) the Company will not have any
adequate remedy at law if Starr violates the terms hereof or fails to
perform any of his obligations hereunder; and (iii) the Company shall
have the right, in addition to any other rights it may have, to obtain
from any court of competent jurisdiction preliminary and permanent
injunctive relief to restrain any breach or threatened breach of or
otherwise to specifically enforce any such covenant or any other
obligations of Starr under
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this Agreement, as well as to obtain damages and an equitable
accounting of all earnings, profits and other benefits arising from
such violation, which rights shall be cumulative and in addition to any
other rights or remedies to which the Company may be entitled.
d) If the period of time or territory of any restriction set
forth in Section 7(a) or 7(b) should be adjudged unreasonable in any
proceeding, then the period of time shall be reduced by such number of
months or the territory shall be reduced by the elimination of such
unreasonable portion thereof or both so that such restrictions may be
enforceable for such time and in the manner adjudged to be reasonable.
8. Miscellaneous.
a) Neither the failure nor any delay on the part of either
party to exercise any right, remedy, power or privilege under this
Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, remedy, power or privilege preclude any
other or further exercise of the same or of any other right, remedy,
power or privilege, nor shall any waiver of any right, remedy, power or
privilege with respect to any occurrence be construed as a waiver of
such right, remedy, power or privilege with respect to any other
occurrence.
b) This Agreement and all questions relating to its validity,
interpretation, performance and enforcement (including, without
limitation, provisions concerning limitations of actions), shall be
governed by and construed in accordance with the laws of the
Commonwealth of Pennsylvania without the aid of any canon, custom or
rule of law requiring construction against the draftsman.
c) All notices, requests, demands and other communications
required or permitted under this Agreement shall be in writing and
shall be deemed to have been duly given, made and received only when
delivered (personally, by courier service such as Federal Express, or
by other messenger) or two days after deposit in the United States
mails, registered or certified mail, postage prepaid, return receipt
requested, addressed as set forth below:
(i) If to the Company:
The Bon-Ton Department Stores, Inc.
0000 Xxxx Xxxxxx Xxxxxx
Xxxx, Xxxxxxxxxxxx 00000
Attention: Chairman of the Board
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(ii) If to Starr:
Xx. Xxxx X. Xxxxx
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Either party may alter the address to which communications are
to be sent by giving notice of such change of address in conformity
with the provisions of this Section for the giving of notice.
d) This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective heirs, personal
representatives, successors and assigns, except that neither party may
assign or transfer its rights or obligations under this Agreement
without the prior written consent of the other party hereto.
e) This Agreement contains the entire understanding between
the parties hereto with respect to the subject matter hereof, and
supersedes all prior and contemporaneous agreements and understandings,
inducements or conditions, express or implied, oral or written, except
as herein contained. The express terms hereof control and supersede any
course of performance and/or usage of the trade inconsistent with any
of the terms hereof. This Agreement may not be modified or amended
other than by an agreement in writing.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of date first above written.
THE BON-TON DEPARTMENT STORES, INC.
By: /s/ Xxx Xxxxxxxxxx
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Xxx Xxxxxxxxxx
Chairman of the Board
/s/ Xxxx X. Xxxxx
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