Exhibit 10.1
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered into as of this 3rd day of January,
1994, by and between XXXX XXXXXXX (hereinafter referred to as "Employee"), and
Track 'N Trail, a California corporation (hereinafter referred to as "Track 'N
Trail").
IN CONSIDERATION of the mutual promises set forth below, Employee and Track
'N Trail hereby agree as follows:
1. EMPLOYMENT. Track 'N Trail hereby agrees to employ Employee, and
Employee agrees to provide services to Track 'N Trail in the position of
Executive Vice President/COO on an "at-will" basis, subject to the terms and
conditions hereinafter set forth.
2. DUTIES. Subject to the control of Track 'N Trail's Board of Directors
and/or Track 'N Trail management personnel with authority over Employee,
Employee shall perform the duties and responsibilities set forth in Attachment A
and such other duties and responsibilities assigned from time-to-time which are
commensurate with Employee's role as Track 'N Trail's Executive Vice
President/COO. Throughout the term of this Agreement, Employee shall devote all
of his or her energies, interest, abilities and productive time to the
performance of his or her duties and responsibilities under this Agreement, and
shall not, without Track 'N Trail's prior written consent, render services to
any other person or entity or otherwise engage in any other activity that would
materially interfere with the performance of such duties and responsibilities
under this Agreement.
3. TERM. The term of this Agreement shall be two (2) year(s) from the
effective date of this Agreement and shall extend and renew for a one-year
period each anniversary date thereafter, unless terminated as set forth herein.
Employee or Track 'N Trail may terminate Employee's employment and this
Agreement with or without "cause" (including by reason of Employee's disability
for more than four months or death) upon thirty (30) days' written notice to the
other party. Additionally, Track 'N Trail may terminate this Agreement and
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Employee's employment for "cause" immediately without notice. "Cause" shall be
defined as follows:
(a) Employee being convicted of, pleading guilty or nolo
contendere to, or confessing to any act of fraud, misappropriation or
embezzlement, or to any felony;
(b) Employee engaging in dishonest acts to the detriment of
Track 'N Trail;
(c) Employee otherwise failing to comply with the terms of this
Agreement and/or engaging in misconduct in violation of Track 'N Trail
policies.
4. PAY ON TERMINATION. Should Track 'N Trail terminate this Agreement
and Employee's employment without cause as defined above and/or materially
breach any portion of this Agreement, Track 'N Trail shall tender to Employee an
amount equal to one (1) year of pay, to be calculated at the highest rate of pay
Employee has received from Track 'N Trail in the two-year period prior to
Employee's termination. Payments of said sum shall be made on Employee's last
day of employment, or on terms mutually agreeable to Employee and Track 'N
Trail.
5. WORKING CONDITIONS. Track 'N Trail agrees that during the term of
this Agreement Track 'N Trail:
(a) Shall provide, establish and maintain reasonable working
conditions for Employee and abide by all state, federal and local
employment regulations and law;
(b) Shall not, without the written consent of Employee,
materially alter or reduce the duties and responsibilities assigned to
Employee as set forth in Attachment A to this Agreement; or
(c) Shall not, without written consent of Employee, require
Employee to relocate to any office in excess of thirty (30) miles from
El Dorado Hills, California.
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Notwithstanding anything to the contrary in this paragraph 5 or this
Agreement overall, Track 'N Trail's failure to meet any of its obligations under
this paragraph 5 shall constitute a termination of Employee without cause
entitling Employee to the sole remedy of electing to continue his or her
employment notwithstanding such failure or to leave Track 'N Trail's employ and
receive compensation from Track 'N Trail pursuant to the provisions of paragraph
4.
6. COMPENSATION. Employee agrees to accept and Track 'N Trail agrees to
pay for Employee's services at the rate of $130,000 per year. Employee shall be
eligible to receive bonuses on the same terms and conditions as other similarly
situated employees. Track 'N Trail reserves the right to increase Employee's
compensation rate prospectively at any time.
7. CONFIDENTIAL INFORMATION. Employee will, in the course of Employee's
duties on behalf of Track 'N Trail, be advised of certain business matters and
affairs of Track 'N Trail regarding its clients and the management of its
business. The duties performed by Employee for Track 'N Trail place Employee in
a position of trust and confidence with respect to certain trade secrets and
other proprietary information relating to the business of Track 'N Trail and not
generally known to the public. These trade secrets include, but are not limited
to, Track 'N Trail's price lists, advertising and promotional ideas and
strategies, customer lists, and formulas, patterns, devices, processes,
compilations of information, records, and specifications which are owned by
Track 'N Trail and which are regularly used in the operation of Track 'N Trail
(hereinafter "confidential information"). Employee will not, either during the
term of Employee's employment or any time in the future, directly or indirectly:
(a) Disclose or furnish, directly or indirectly, to any other
person, firm, agency, corporation, client, business, or enterprise,
any confidential information acquired by Employee during the term of
this Agreement;
(b) Individually or in conjunction with any other person, firm,
agency, company, client, business or corporation, employ or cause to
be employed any confidential information in any manner whatsoever,
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except in furtherance of the business of Track 'N Trail;
(c) Without the written consent of Track 'N Trail, publish,
deliver, or commit to being published or delivered, any copies,
abstracts, or summaries of any files, records, documents, drawings,
specifications, lists, equipment, and similar items relating to the
business of Track 'N Trail, whether prepared by the Employee or
otherwise coming into the Employee's possession, except to the extent
required in the ordinary course of Track 'N Trail's business;
(d) Attempt to encourage, induce, or otherwise solicit, directly
or indirectly, any other employee of Track 'N Trail to breach an
employment agreement with Track 'N Trail or to otherwise interfere
with the advantageous business relationship of Track 'N Trail with its
employees.
All files, records, documents, drawings, specifications, lists, equipment
and similar items relating to the business of Track 'N Trail, whether prepared
by Employee or otherwise coming into the Employee's possession, shall remain the
exclusive property of Track 'N Trail and shall not be removed from the premises
of Track 'N Trail under any circumstances whatsoever without the prior written
consent of an officer of Track 'N Trail.
Upon termination of Employee's employment, Employee agrees to immediately
return to Track 'N Trail all property of Track 'N Trail in as good condition as
when received by Employee (normal wear and tear excepted) including, but not
limited to, all files, records, documents, drawings, specifications, lists,
equipment and supplies, promotional materials and similar items relating to the
business of Track 'N Trail.
8. REPAYMENTS. Employee hereby expressly agrees to repay to Track 'N
Trail any and all sums owed by Employee to Track 'N Trail immediately upon
termination of Employee's employment.
S /GK/
________
Employee
Initials
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9. ARBITRATION. In the event Employee's employment and this Agreement
are terminated, and Employee believes the termination was wrongful and/or
violated any of Employee's rights, Employee and Track 'N Trail agree to submit
any dispute arising out of the termination of Employee's employment, including,
but not limited to, claims of termination allegedly resulting from
discrimination on the basis of race, sex, age, national origin, ancestry, color,
religion, marital status, status as a veteran of the Vietnam era, physical or
mental disability, medical condition, or any other basis prohibited by law,
exclusively to final and binding arbitration before a neutral arbitrator.
If Employee and Track 'N Trail are unable to agree upon a neutral
arbitrator, Track 'N Trail will obtain a list of arbitrators from a state or
federal arbitration service. Employee (first) and then Track 'N Trail will
alternately strike names from the list until one name remains; the remaining
person shall be the arbitrator. The arbitrator shall be bound by the
qualifications and disclosure provisions and the procedures set forth in the
1989 Model Employment Arbitration Procedures of the American Arbitration
Association and shall order such discovery as is appropriate to the nature of
the claim and necessary to the adjudication thereof.
Arbitration proceedings shall be held in the city or town where Employee's
employment services were performed, at Track 'N Trail headquarters or at any
other location mutually agreed upon by Employee and Track 'N Trail. The
arbitrator shall determine the prevailing party in the arbitration and the costs
of the arbitration shall be paid by the nonprevailing party.
Employee and Track 'N Trail agree that this arbitration shall be the
exclusive means of resolving any dispute arising out of Employee's termination
and that no other action will be brought by Employee in any court or other
forum. ONLY THE ARBITRATOR, NOT A JUDGE OR JURY, WILL DECIDE THE DISPUTE.
If Employee decides to dispute Employee's termination, Employee agrees to
deliver a written request for arbitration to Track 'N Trail within one year of
the date of Employee's termination and to respond within 14 calendar days to
each communication regarding the selection of an arbitrator and the scheduling
of a hearing and other matters related to arbitration proceedings. If Track 'N
Trail does not receive a written
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request for arbitration from Employee within one year from the date of
Employee's termination or if Employee does not respond to any communication from
Track 'N Trail about the arbitration proceedings within 14 calendar days,
Employee agrees Employee will have waived any right to raise any claims arising
out of the termination of Employee's employment with Track 'N Trail in
arbitration or in any court or other forum. The limitations set forth in this
paragraph shall not be subject to tolling, equitable or otherwise.
The arbitrator shall be permitted to award only those remedies in law or
equity which are requested by the parties and supported by credible, relevant
evidence. The provisions of this arbitration provision shall survive the
termination of this Agreement and Employee's employment, and shall remain in
full force and effect thereafter.
Employee and Track 'N Trail agree that if any court of competent
jurisdiction declares that any part of this arbitration provision is illegal,
invalid or unenforceable, such a declaration will not affect the legality,
validity or enforceability of the remaining parts of the arbitration provision
and the illegal, invalid or unenforceable part will no longer be part of this
arbitration provision.
S /GK/
________
Employee
Initials
10. POLICIES. Employee shall be bound by all the policies, rules and
regulations of Track 'N Trail now in force, and by all such other policies,
rules and regulations as may be hereafter implemented and called to his/her
notice, and will faithfully observe and abide by the same.
11. OTHER TERMS AND CONDITIONS OF EMPLOYMENT.
See Attachment B - Bonus Program
See Attachment C - Stock Appreciation Rights Agreement
(If none, Employee initial here. ______).
12. INDEMNIFICATION. Track 'N Trail agrees that Track 'N Trail shall
indemnify and hold Employee harmless for any and all losses, costs, damages,
expenses, including attorneys' fees,
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incurred by Employee as a direct consequence of the discharge of his/her duties
as such and/or by reason of the fact that Employee is or was an agent of Track
'N Trail. Track 'N Trail further agrees to indemnify and hold Employee harmless
for any and all losses, costs, damages, expenses, including attorneys' fees,
incurred by Employee arising out of Track 'N Trail's breach of this Agreement or
any part thereof, regardless of the judgment or decisions arising therefrom.
13. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
parties hereto and upon their heirs, administrators, representatives, executors,
successors and assigns and shall inure to the benefit of said parties and each
of them and their heirs, administrators, representatives, executors, successors
and assigns provided, however, that in no event may Employee assign his or her
rights or delegate his or her duties under this Agreement to any other party
without the prior written consent of Track 'N Trail.
14. SEVERABILITY. Track 'N Trail and Employee agree that should any
provision of this Agreement be declared or be determined by any court of
competent jurisdiction to be illegal, invalid or unenforceable, the legality,
validity and enforceability of the remaining parts, terms and provisions shall
not be affected thereby, and said illegal, unenforceable or invalid part, term
or provision will be deemed not to be part of this Agreement.
15. ENTIRE UNDERSTANDING. This Agreement contains all the understandings
and agreements between the parties concerning Employee's employment and Employee
acknowledges that no person who is either an agent or employee of Track 'N Trail
may orally or by conduct modify, delete, vary, or contradict, the terms and
conditions set forth herein. This Agreement replaces any and all prior
agreements between Employee and Track 'N Trail related
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to Employee's employment and any and all such prior Agreements are hereby
canceled.
IN WITNESS WHEREOF, the parties have executed this Agreement at El Dorado
Hills, California to be effective as of the date first written above.
EMPLOYEE:
/S/ XXXXXXX X. XXXXXXX
-----------------------------------------
TRACK 'N TRAIL, a California corporation
By: /S/ XXXX XXXXXXXXX, XX.
------------------------------------
Name: XXXX XXXXXXXXX, XX.
Title: President
Copy Delivered to Employee
on 1/3/94
-------------------------------------
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JOB DESCRIPTION - EXECUTIVE VICE PRESIDENT/C.O.O.
1.0 INTRODUCTION:
1.1 The purpose of this procedure is to establish and define the
position of Executive Vice President/C.O.O.
1.2 The basic function of the Executive Vice President/C.O.O. is to
provide the necessary leadership to direct Track 'N Trail's
business management, executing the plans and policies established
by the President. The Executive Vice President/C.O.O. will manage
and control Track 'N Trail's daily activities.
2.0 AUTHORITY:
2.1 As an officer of Track 'N Trail, the Executive Vice President/
C.O.O. is appointed at will by the Board of Directors and reports
directly to the President.
2.2 The following positions report directly to the Executive Vice
President/C.O.O.:
2.21 Vice President of Marketing
2.22 Vice President of Stores
2.23 Vice President of Finance/C.F.O.
2.24 Director of Real Estate and Construction
2.3 The Executive Vice President/C.O.O. has the authority to implement
Track 'N Trail's financial plan as long as sales and income levels
are at or ahead of schedule. If sales or income levels are
behind, approved spending levels must be re-approved by the
President.
2.4 The Executive Vice President/C.O.O. has the authority to
re-allocate departmental budgets within the overall approved
budget plan providing sales goals and net profit goals are within
plan or better and he/she has the support of the V.P. of
Finance/C.F.O.
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2.5 The Executive Vice President/C.O.O. exercises hiring, promoting,
commending, and terminating authority over personnel reporting
directly to the Executive Vice President/C.O.O. This authority
requires the approval of the Board of Directors in any case
involving Officers of Track 'N Trail.
2.6 The Executive Vice President/C.O.O. has the authority to conduct
compensation reviews for those positions directly reporting the
him/her and recommend changes as part of the budget process.
3.0 RESPONSIBILITIES:
The Executive Vice President/C.O.O. is responsible for the following:
3.1 As the Chief Operating Officer, providing the necessary leadership
and management to execute the plans and policies of the President.
3.2 Managing the overall operations of Track 'N Trail in the most
efficient manner in order to achieve the profitability and growth
goals as established by the President.
3.3 Advising and supporting the President on all matters.
3.4 Developing and coordinating the budget process and its submission
to the President for approval.
3.5 Monitoring the overall operations of Track 'N Trail to ensure full
compliance with all Federal, State, and local regulations.
3.6 Advising the President on other business opportunities and/or
acquisitions.
3.7 Coordinating all outside professional services deemed appropriate
by the President.
3.8 Executing and directing the implementation of all personnel
policies established by the President.
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3.9 Implementing and enforcing a corporate management training and
development plan to increase the expertise of the management team.
3.10 Directing the execution of Track 'N Trail's public relations
policy.
3.11 Directing the establishment of personnel policies to ensure
company-wide standardization and compliance.
3.12 Directing the implementation of established marketing guidelines.
4.0 DUTIES:
The duties of the Executive Vice President/C.O.O. include the following:
4.1 Supervise and direct the activities of the Managers of each
department to enforce the execution of Track 'N Trail's plans and
policies.
4.2 Resolve problems crossing departmental lines of responsibility.
4.3 Chair the Executive Advisory Committee and direct its activities.
4.4 Monitor the development and standardization of company-wide policy
procedures.
4.5 Receives reports to monitor business operations in an accurate and
timely manner in order to direct appropriate corrective action.
4.8 Brief the President on a regular basis regarding financial,
personnel, and field management problems, actions initiated and
attainment of goals to date.
4.9 Annually evaluates those personnel who report directly to the
Executive Vice President/C.O.O.
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4.10 Coordinates staffing/xxxxxxx requirements as needs change and
incorporates those recommendations into the budget process for
Track 'N Trail.
4.11 At least annually, review those job descriptions of the positions
reporting directly to the Executive Vice President C.O.O. for
content and accuracy in describing the functional authority,
responsibilities, and duties.
5.0 MEASURES OF PERFORMANCE:
The Executive Vice President/C.O.O. is deemed to be performing in a
satisfactory manner when the following are met:
5.1 The management of Track 'N Tail has resulted in consistently
achieving at least 90% of the profit goal and budget expense goals
are maintained within 4% of budget.
5.2 The activities of Track 'N Trail and the Executive Vice President/
C.O.O. are consistent with the directives of the President in
supporting field units to sell products.
5.3 The company budget was properly developed in an accurate,
realistic, achievable, and timely manner.
5.4 Leadership was applied in a fair, effective, and consistent manner
resulting in positive morale throughout the company.
5.5 The plans and policies of the President were executed in a
satisfactory manner conforming to established standards.
5.6 Proper performance evaluations have been accomplished for
personnel reporting directly to the Executive Vice President/
C.O.O. in an accurate and timely manner.
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TRACK 'N TRAIL AGREEMENT FOR
STOCK APPRECIATION RIGHTS
TRACK 'N TRAIL, INC., a California corporation (the "Company"), agrees with
XXXXXXX X. XXXXXXX ("Xxxxxxx") as follows:
1. PURPOSE OF AGREEMENT. The purpose of this Agreement is to further the
long-term growth and earnings of the Company by offering long-term incentives in
addition to current compensation to Xxxxxxx for the performance of his duties as
Executive Vice President and Chief Operating Officer of the Company. The Track
'n Trail Agreement for Stock Appreciation Rights between the Company and Xxxxxxx
dated May 26, 1992, is hereby terminated and shall be of no further force and
effect, and this Agreement shall be the only Stock Appreciation Rights Agreement
between the Company and Xxxxxxx.
2. DEFINITIONS.
(a) STOCK APPRECIATION RIGHTS. The Vested Percentage of the value of the
Company's issued and outstanding capital stock on the Valuation Date in excess
of $3,551,845, which is the book value of the Company on June 29, 1991.
(b) VESTED PERCENTAGE. Vested Percentage is defined by the following
schedule showing the Vested Percentage on the first day of the Company's fiscal
year beginning in each of the years set forth in the schedule.
Fiscal Year Beginning In Vested Percentage
1993 0.4%
1994 0.8%
1995 1.2%
1996 1.6%
1997 2.0%
(c) VALUATION DATE. The Valuation Date is the earlier of:
(i) The date that Xxxxxxx'x employment is terminated, whether
by the Company, by Xxxxxxx, or by his death or his retirement;
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(ii) The date that Xxxxxxx becomes permanently totally
disabled, as evidenced by a physician's written determination;
(iii) The date June 1, 2007; or
(iv) The date that ownership of more than 50% of the Company's
issued and outstanding capital stock is acquired by any entity or entities
other than members of the family of Xxxxx X. Xxxxxxxxx, Xx.
3. VALUATION METHOD. For purposes of determining "the value of the
Company's issued and outstanding capital stock on the Valuation Date" within the
meaning of the definition of Stock Appreciation Rights, the following valuation
method shall be used:
(a) If the Valuation Date is the date referred to in subparagraph
3(c)(i), (ii) or (iii), then "the value of the company's issued and
outstanding capital stock on the Valuation Date" shall be the book value of
the Company at its immediately preceding fiscal year end. Book value is
defined as the sum of the Company's retained earnings, its capital stock
and its paid-in capital.
(b) If the Valuation Date is the date referred to in subparagraph
3(c)(iv), then "the value of the Company's issued and outstanding capital
stock on the Valuation Date" shall be a sum determined by multiplying the
fair market value of the consideration paid for each share of stock
acquired by the new outside controlling entity or entities by the total
number of shares of issued and outstanding capital stock of the Company on
the Valuation Date.
4. PAYMENT FOR STOCK APPRECIATION RIGHTS. The dollar value of the Stock
Appreciation Rights shall be paid without interest to Xxxxxxx in five (5) equal
annual installments, the first of which shall be paid within thirty (30) days of
the Valuation Date, the second on the first anniversary of the Valuation Date,
the third on the second anniversary of the Valuation Date, the fourth on the
third anniversary of the
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Valuation Date and the last on the fourth anniversary of the Valuation Date.
5. XXXXXXX'X RIGHTS UNSECURED. Xxxxxxx'x right to receive payment
pursuant to this Agreement shall be an unsecured claim against the general
assets of the Company.
6. XXXXXXX'X RIGHTS NON-TRANSFERABLE. Xxxxxxx'x rights are personal to
him and to any person or persons who may become entitled by reason of Xxxxxxx'x
death, and Xxxxxxx'x rights or the rights of any such successors shall not be
subject to voluntary or involuntary alienation, assignment or transfer by
Xxxxxxx or any such successors.
7. BINDING UPON SUCCESSORS. The obligations of the Company under this
Agreement shall be binding upon any successor corporation or organization which
shall succeed to substantially all of the assets and business of the Company and
the terms "Company" whenever used in this Agreement shall mean and include any
such corporation or organization after such succession. If the business
conducted by the Company shall be discontinued, any unpaid installment under
this Agreement shall become payable in a lump sum to the person or persons
entitled thereto.
8. DESIGNATION OF BENEFICIARY TO RECEIVE PAYMENTS IN THE EVENT OF
XXXXXXX'X DEATH. If Xxxxxxx should die before receipt of all payments to which
he is entitled hereunder, payments of the amounts to which he is further
entitled shall be made to such beneficiary as Xxxxxxx shall have designated by
an instrument in writing filed with the Secretary of the Company, or, in the
absence of such designation, to his personal representative. Such payments
shall be made in the same manner and at the same intervals as they would have
been made to Xxxxxxx had he continued to live.
9. NO EMPLOYMENT RIGHTS. Xxxxxxx shall have no right to be retained in
the employ of the Company by virtue of this Agreement.
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10. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
EXECUTED this 8th day of October, 1992 in El Dorado, Hills, California.
TRACK 'N TRAIL, INC.
By: /S/ XXXXX X. XXXXXXXXX, XX.
------------------------------------
Xxxxx X. Xxxxxxxxx, Xx.
President
/S/ XXXXXXX X. XXXXXXX
-----------------------------------------
Xxxxxxx X. Xxxxxxx
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TRACK 'N TRAIL AGREEMENT FOR
STOCK APPRECIATION RIGHTS
TRACK 'N TRAIL, INC., a California corporation (the "Company"), agrees with
XXXXXXX X. XXXXXXX ("Xxxxxxx") as follows:
1. PURPOSE OF AGREEMENT. The purpose of this Agreement is to further the
long-term growth and earnings of the Company by offering long-term incentives in
addition to current compensation to Xxxxxxx for the performance of his duties as
Executive Vice President and Chief Operating Officer of the Company. The Track
'N Trail Agreements for Stock Appreciation Rights between the Company and
Xxxxxxx dated May 26, 1992 and October 8, 1992, are hereby terminated and shall
be of no further force and effect, and this Agreement shall be the only
Agreement for Stock Appreciation Rights between the Company and Xxxxxxx.
2. DEFINITIONS.
(a) STOCK APPRECIATION RIGHTS. The Vested Percentage of the value of the
Company is issued and outstanding capital stock on the Valuation Date in excess
of $7.5 million.
(b) VESTED PERCENTAGE. Vested Percentage is defined by the following
schedule showing the Vested Percentage on the first day of the Company's fiscal
year beginning in each of the years set forth in the schedule.
Fiscal Year Beginning In Vested Percentage
------------------------ ------------------
1993 1%
1994 2%
1995 3%
1996 4%
1997 5%
(c) VALUATION DATE. The Valuation Date is the earlier of:
(i) The date that Xxxxxxx'x employment is terminated whether
by the Company, by Xxxxxxx, or by his death or his retirement;
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(ii) The date that Xxxxxxx becomes permanently totally
disabled, as evidenced by a physician's written determination;
(iii) The date June 1, 2007; or
(iv) The date that ownership of more than 50% of the Company's
issued and outstanding capital stock is acquired by any entity or entities
other than members of the family of Xxxxx X. Xxxxxxxxx, Xx.
3. VALUATION METHOD. For purposes of determining "the value of the
Company's issued and outstanding capital stock on the Valuation Date" within the
meaning of the definition of Stock Appreciation Rights, the following valuation
method shall be used:
(a) If the Valuation Date is the date referred to in
subparagraph 2(c)(i), (ii) or (iii), then "the value of the Company's
issued and outstanding capital stock on the Valuation Date" shall be
7.6 times the Company's average annual pre-tax earnings for the three
fiscal years immediately preceding the Valuation Date.
(b) If the Valuation Date is the date referred to in
subparagraph 2(c)(iv), then "the value of the Company's issued and
outstanding capital stock on the Valuation Date" shall be a sum
determined by multiplying the fair market value of the consideration
paid for each share of stock acquired by the new outside controlling
entity or entities by the total number of shares of issued and
outstanding capital stock of the Company on the Valuation Date.
4. PAYMENT FOR STOCK APPRECIATION RIGHTS. The dollar value of the Stock
Appreciation Rights shall be paid without interest to Xxxxxxx in five (5) equal
annual installments, the first of which shall be paid within thirty (30) days of
the Valuation Date, the second on the first anniversary of the Valuation Date,
the third on the second anniversary of the Valuation Date, the fourth on the
third anniversary of the Valuation Date and the last on the fourth anniversary
of the Valuation Date.
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5. XXXXXXX'X RIGHTS UNSECURED. Xxxxxxx'x right to receive payment
pursuant to this Agreement shall be an unsecured claim against the general
assets of the Company.
6. XXXXXXX'X RIGHTS NON-TRANSFERABLE. Xxxxxxx'x rights are personal to
him and to any person or persons who may become entitled by reason of Xxxxxxx'x
death, and Xxxxxxx'x rights or the rights of any such successors shall not be
subject to voluntary or involuntary alienation, assignment or transfer by
Xxxxxxx or any such successors.
7. BINDING UPON SUCCESSORS. The obligations of the Company under this
Agreement shall be binding upon any successor corporation or organization which
shall succeed to substantially all of the assets and business of the Company and
the term "Company" whenever used in this Agreement shall mean and include any
such corporation or organization after such succession. If the business
conducted by the Company shall be discontinued, any unpaid installment under
this Agreement shall become payable in a lump sum to the person or persons
entitled thereto.
8. DESIGNATION OF BENEFICIARY TO RECEIVE PAYMENTS IN THE EVENT OF
XXXXXXX'X DEATH. If Xxxxxxx should die before receipt of all payments to which
he is entitled hereunder, payments of the amounts to which he is further
entitled shall be made to such beneficiary as Xxxxxxx shall have designated by
any instrument in writing filed with the Secretary of the Company, or, in the
absence of such designation, to his personal representative. Such payments
shall be made in the same manner and at the same intervals as they would have
been made to Xxxxxxx had he continued to live.
9. NO EMPLOYMENT RIGHTS. Xxxxxxx shall have no right to be retained in
the employ of the Company by virtue of this Agreement.
10. NO GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of California.
EXECUTED this ____ day of __________, 1994 in El Dorado Hills, California.
TRACK 'N TRAIL, INC.
By: ----------------------------------
Xxxxx X. Xxxxxxxxx, Xx.
President
---------------------------------------
Xxxxxxx X. Xxxxxxx
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DATE: JANUARY 3, 1994
TO: XXXX XXXXXXX
FROM: XXXX XXXXXXXXX XX.
SUBJECT: 1994 EXECUTIVE BONUS PROGRAM
****************************PERSONAL AND CONFIDENTIAL*************************
I AM PLEASED TO ANNOUNCE THE 1994 BONUS PLAN FOR YOU, FOR THE PERIOD ENDING
12/31/94. THE DETAILS AND AN EXAMPLE OF THE PLAN ARE ON THE ENCLOSED
ATTACHMENT. YOUR BONUS EARNINGS WILL BE BASED UPON FIVE AREAS OF RESPONSIBILITY
AS FOLLOWS:
PROFITABILITY - 6% EARNINGS ON PRE-TAX INCOME ABOVE THE BENCHMARK EARNINGS OF
$2,499,000.
STORE WAGE CONTROL - $50 FOR EACH .01% SAVINGS BELOW THE 10.79% PLAN.
COMP STORE SALES GAIN - $50 FOR EACH .01% ABOVE THE 3.0% PLAN.
INVENTORY CONTROL - $50 FOR EACH .01% UNDER THE .60% PLAN SHRINK
MODIFIED MAINTAINED MARGIN - $50 FOR EACH .01% OVER THE 48.06% PLAN.
IT IS UNDERSTOOD THAT IF CERTAIN MINIMUM PERFORMANCE IS NOT ATTAINED AS DEFINED
ON THE ATTACHMENT, THAT THE EMPLOYEE WILL NOT PARTICIPATE IN THE BONUS PROGRAM
FOR 1994.
THE PRE-TAX PROFITS WILL NOT BE PENALIZED (REDUCED) FOR ITEMS WHICH ARE NOT
NORMAL OPERATING ITEMS, INCLUDING:
- LEGAL BILLS INCURRED IN DEFENDING THE COMPANY FROM SHAREHOLDERS
- LEGAL/ACCOUNTING/APPRAISAL/INVESTMENT BANKING OR ANY OTHER BILLS
RELATED TO THE SALE OR POTENTIAL SALE OF THE COMPANY
- ANY PAYMENTS/FEES PAID TO OR ON BEHALF OF XXXX XXXXXXXXX XX./XXXXXXX
XXXXXXXXX.
- ANY DISTRIBUTIONS TO THE SHAREHOLDERS.
- ANY COURT ORDERED EXPENSE DUE TO THE SHAREHOLDERS INCLUDING PAYMENT
FOR BOARD MEMBERS, OR NEUTRAL "EMPLOYEES".
- ANY MANAGEMENT FEE SALARY OR SIMILAR EXPENSE FROM NEW OWNERS
- ANY EXPENSE PAID TO TERMINATE A LEASE ON A NON-PRODUCTIVE STORE, NET
OF ANY SAVINGS IN THE CURRENT YEAR FROM EARLY TERMINATION.
- EXPENSES INCURRED DUE TO STOCK APPRECIATION RIGHTS.
- ANY OTHER EXPENSES NOT IN THE NORMAL COURSE OF BUSINESS
IT IS UNDERSTOOD THAT THIS BONUS AGREEMENT SHALL BE BINDING UPON ANY SUCCESSORS,
SHOULD THE COMPANY BE SOLD IN PART OR IN WHOLE.
THE BONUS PAYOUT FOR CALENDAR 0000 XXXX XXXXX XX XX BEFORE 3/15/95, FOR EACH
PARTICIPANT THAT WAS EMPLOYED AS OF 12/31/94.
THIS BONUS PLAN IS EFFECTIVE FOR THE CALENDAR YEAR 1994 ONLY, AND THE COMPANY
RESERVES THE RIGHT TO ELIMINATE OR CHANGE THE BONUS PROGRAM FOR FUTURE PERIODS.
