AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "Agreement"),
made and entered into as of ________________ ___, 1998, is by and between
Lamonts Apparel, Inc., a Delaware corporation (the "Company"), and Xxxx
Xxxxxxxxxxx ("Executive").
WHEREAS, this Agreement, which amends and restates the Employment
Agreement, dated as of April 18, 1995 (the "Existing Employment Agreement"),
between executive and the Company, is being entered into in connection with the
Company's Plan of Reorganization (the "Plan of Reorganization" or "Plan");
WHEREAS, the Plan of Reorganization provides, among other things, for
the continued employment of Executive after confirmation of the Plan of
Reorganization and dismissal of the Company's Chapter 11 case (the "Bankruptcy
Case") under Chapter 11 of the United States Bankruptcy Code;
WHEREAS, the Plan was confirmed by order entered on [ ] by the
United States Bankruptcy Court for the Western District of Washington at Seattle
and the Bankruptcy Case has been dismissed; and
WHEREAS, the Plan included provision for employment of the Executive
pursuant to the terms of the Agreement;
NOW, THEREFORE, in consideration of the foregoing recitals and of the
mutual covenants set forth herein, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties agree
to amend and restate the Existing Employment Agreement as follows:
1. EMPLOYMENT OF EXECUTIVE; TITLE.
(a) EMPLOYMENT. Executive agrees to be employed by the Company,
and the Company agrees to employ Executive, on the terms and conditions set
forth in this Agreement. Executive agrees during the term of his employment to
devote substantially all of his business time, efforts, skills and abilities to
the performance of his duties as stated in this Agreement and to the furtherance
of the Company's business.
(b) TITLE. Executive's job title will be Chief Executive
Officer and his duties will be those as are designated by the Board of Directors
of the Company ("Board"), consistent with the position of Chief Executive
Officer. Executive further agrees to serve, without additional compensation, as
a director of the Company, and as an officer or director, or both, of any
subsidiary, division or affiliate of the Company or any other entity in which
the Company holds an equity interest; PROVIDED, however, that the Company shall
indemnify Executive from liabilities in connection with serving in any such
position to the same extent as his indemnification rights pursuant to the
Company's Certificate of Incorporation, By-Laws and applicable Delaware law.
2. COMPENSATION.
(a) BASE SALARY. Executive's BASE SALARY shall be composed of
the following:
i) SALARY. During the term of Executive's employment with
the Company pursuant to this Agreement, the Company shall pay to Executive as
compensation for his services an annual salary of $450,000 payable semi-monthly
("Salary"). Executive's Salary will be payable in arrears in accordance with
the Company's normal payroll procedures and will be reviewed annually and
subject to upward adjustment as provided in paragraph 3(a)(iii) below.
ii) GUARANTEED PERFORMANCE BONUS. In addition to his salary
the Executive shall be paid a guaranteed annual bonus in the sum of $100,000 per
year the ("Minimum Bonus"), payable at the end of each calendar year. In the
event the Executive resigns or the Executive's employment is terminated during
the year, the guaranteed annual bonus shall be prorated and paid upon
termination.
iii) INCREASES IN BASE SALARY. Beginning on January 31,
1998, the Executive's Base Salary and Minimum Bonus shall be reviewed by the
Board or the Compensation Committee thereof no less frequently than on each
January 31 during the Term. The Base Salary and Minimum Bonus payable to
Executive may be increased on each such date (and at such other times as such
Board or the Compensation Committee may deem appropriate during the Term) to
such amount determined appropriate by such Board or the Compensation Committee;
PROVIDED, HOWEVER, that Executive's Base Salary and Minimum Bonus shall be
increased annually in a minimum amount equal to the cost-of-living increment as
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reported in the "Consumer Price Index, Seattle, Washington, All Items,"
published by the U.S. Department of Labor (using January 1, 1995 as the base
date for comparison with respect to the increase to be made on January 31,
1998, and using January 1, of the immediately preceding year as the base date
for comparison with respect to each annual increase to be made thereafter).
Each such new Base Salary and Minimum Bonus shall become the base for each
successive year increase. Any increase in Base Salary, Minimum Bonus or
other compensation shall in no way limit or reduce any other obligations of
the Company hereunder and, once established as an increased specified rate,
Executive's Base Salary and Minimum Bonus shall not be reduced unless
Executive otherwise agrees in writing.
(b) BONUS COMPENSATION.
i) REORGANIZATION BONUS. Upon the Effective Date, the
Company became obligated to pay to the Executive, a bonus (the "Reorganization
Bonus") in an amount equal to $400,000. The Reorganization Bonus shall be
payable within 10 days after the Effective Date. If Executive shall cease to be
employed by the Company prior to the one year anniversary of the Effective Date
as a result of Executive's voluntary termination of this Agreement in accordance
with Section 7 hereof, Executive shall repay to the Company on such date
Executive ceases to be so employed, one-half of the amount of the Reorganization
Bonus received by Executive hereunder. The Reorganization Bonus shall be an
Expense of Administration obligation of the Company.
ii) EXTENSION BONUS. The Company shall pay to Executive an
extension bonus of $175,000 payable on February 2, 1998, PROVIDED THAT,
Executive is employed by the Company on such date.
(c) RETENTION OF PRIOR BENEFITS. The Executive shall retain all
monies and other benefits previously paid to him by reason of the Existing
Employment Agreement.
(d) EXECUTIVE PERQUISITES. Executive shall be entitled to
receive such executive perquisites and fringe benefits as have been customarily
provided to senior executives of the Company.
(e) MISCELLANEOUS BUSINESS EXPENSES. Executive shall be entitled
to receive an allowance of $1,500 per month, payable monthly in advance,
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for unreimbursed business-related expenses including the use of one personal
vehicle.
(f) STOCK OPTIONS.
i) On the Effective Date, the Company shall issue to
Executive (i) options to purchase 600,000 shares of common stock of the Company
("Common Stock"), and (ii) to prevent dilution upon exercise of the New Class A
Warrants and the New Class B Warrants (as each such term is defined in the Plan
of Reorganization), (x) options to purchase 146,888 shares of Common Stock,
which option shall be exercisable at a price of $.01 per share on the first date
on which the Aggregate Equity Trading Value (as such term is defined in the Plan
of Reorganization) equals or exceeds $20 million and (y) options to purchase
53,349 shares of Common Stock, which option shall become exercisable at a price
of $.01 per share on the first date on which the Aggregate Equity Trading Value
equals or exceeds $25 million; PROVIDED THAT, the aggregate number of options
described in clauses (ii)(x) and (y) above which may be exercised by Executive
shall bear the same proportion (based on the total number of such options
granted to Executive) to the number of options described in clause (i) above
that have been exercised by Executive (based on the total number of such options
granted to Executive). In addition, to prevent dilution upon the exercise of
the New Class C Warrants (as such term is defined in the Plan of
Reorganization), Executive will be issued New Class C Warrants exercisable for
228,639 shares of Common Stock, exercisable in accordance with the terms
thereof.
ii) The Options shall have a term of ten years and shall
vest (x) 50% upon the Effective Date, (y) 25% on the first anniversary of the
Effective Date and (z) 25% on the second anniversary of the Effective Date;
PROVIDED THAT, such options shall vest in full upon a Change in Control (as
defined in Section 6 hereof).
(g) TAX WITHHOLDING. The Company has the right to deduct from
any compensation payable to Executive under this Agreement social security
(FICA) taxes and all federal, state, municipal or other such taxes or charges as
may now be in effect or that may hereafter be enacted or required.
(h) BOARD MEMBERSHIP. The Company agrees that it will use its
best efforts to cause Executive to be nominated to the Board and to serve as
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Chairman of the Board at each annual meeting of stockholders of the Company
during the term of this Agreement.
(i) LIFE INSURANCE. In addition to any other insurance which the
Company may choose to maintain on the life of the Executive, the Company shall
provide, to the extent it is reasonably able to do so, a term life insurance
policy in the face amount of two million dollars ($2,000,000) payable to such
beneficiary as the Executive may designate; provided, however, that in no event
shall the Company be required to pay premiums on such term life insurance policy
in excess of $15,000 per annum.
(j) DIRECTOR'S AND OFFICER'S INSURANCE. The Company shall
maintain directors' and officers' insurance policies during the term of
Executive's employment hereunder and for a period of twelve months thereafter on
substantially the same terms as the Company's current policies; PROVIDED THAT,
if any insurer shall cancel or refuse to renew any such policy and the Company
is unable to obtain a replacement policy on substantially the same terms
reasonably satisfactory to Executive, the Company will timely exercise any and
all options thereunder, and pay any and all premiums or other charges necessary,
to extend the period during which claims may be made thereunder; further
PROVIDED THAT, the Company shall not be required to pay such premiums or other
charges necessary to extend such period if they are substantially in excess of
the premiums in effect on the date hereof. If the Company does not maintain
directors' and officers' insurance at any time during the term of Executive's
employment hereunder, Executive may terminate this Agreement immediately and
such termination shall be treated as a termination without Cause hereunder.
3. DURATION OF EMPLOYMENT.
(a) TERM. Unless otherwise terminated at an earlier date in
accordance herewith Sections 4 or 6 hereof, the term of Executive's employment
under this Agreement shall be for a period commencing on the effective date of
the Plan of Reorganization (the "Effective Date") and ending on January 31,
2002, (the "Term").
(b) EARLY TERMINATION. Notwithstanding the foregoing, this
Agreement (other than Sections 5 through 14, hereof) will terminate upon the
earliest to occur of: (a) the date the Company terminates Executive's
employment, (b) the date Executive resigns from the Company, (c) notice from the
Company following
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the disability of Executive that renders him unable to perform his essential
duties under this Agreement, even with reasonable accommodation that does not
cause undue hardship to the Company, for at least 90 days out of any 120
consecutive day period, or (d) the death of Executive, provided, however,
that in the event of the death of Executive, the Company shall pay to the
estate of Executive six months of Base Salary commencing with the next
regular pay period after the date of his death ("Death Benefit"). Any Death
Benefit otherwise payable by the Company shall be offset by proceeds from any
life insurance furnished by the Company for payment of the Death Benefit
under this Section 3(b).
4. TERMINATION BY THE COMPANY; DEFINITION OF CAUSE. Executive's
employment under this Agreement (and his right to receive the compensation set
forth in Section 2 hereof) may be terminated by the Company at any time for
"Cause," or (subject to the rights of Executive pursuant to Section 5 hereof)
without "Cause." As used herein, "Cause" shall mean:
(a) Any dishonest or fraudulent act or course of conduct by
Executive, or other act or course of conduct by Executive constituting a
criminal act or which results in improper gain or personal enrichment of
Executive at the expense of the Company, or the commission by Executive of an
act or a course of conduct involving moral turpitude, or Executive's
insubordination to the Board.
(b) Executive's material breach of any of the terms or
conditions of this Agreement or of policies established by the Board, or
Executive's material neglect of his duties or of the Company's business,
provided, however, that no such termination pursuant to this clause (b) shall
be effective unless the Company shall have given Executive ten days' prior
written notice of any such conduct which, if not discontinued or corrected,
would lead to his termination for Cause. Executive will have the opportunity
to cure such non-complying conduct or performance within such 10-day period.
Termination pursuant to this clause (b) shall be effective with respect to
matters referred to in this clause (b) ten days after such notice unless such
conduct has been cured in the good faith judgment of the Board, subject to
the provisions of clause (c) below.
(c) In the event that the Executive disputes the grounds for a
claim of misconduct under clause (b) above, the Bankruptcy Court, prior to the
Effective Date, shall have jurisdiction to determine whether the alleged
misconduct constitutes reasonable grounds for termination for cause. In such
event the determination of the Bankruptcy Court shall be binding upon the
parties.
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5. SEVERANCE PAYMENT ON TERMINATION WITHOUT CAUSE.
(a) TERMINATION WITHOUT CAUSE. If Executive's employment is
terminated by the Company without Cause during the term of this Agreement, the
Company shall be obligated to continue to pay Executive his Base Salary for a
period of two years or for the remainder of the term of this Agreement,
whichever period is shorter, subject to the provisions in Section 6 pertaining
to Change in Control; PROVIDED THAT, such payments are subject to reduction in
accordance with the provisions of 5(b) hereof. At the Company's sole option,
the Company may elect to pay Executive any remaining Base Salary due under this
5(a) in a lump sum, equal to the present value of such remaining Base Salary
payments at an effective annual interest rate of 10 percent.
(b) OFFSET. If Executive's employment with the Company is
terminated pursuant to 5(a), this clause (b) shall apply. The payments which
would have been due and payable in accordance with 5(a) hereof shall be reduced
by an amount equal to any amounts that Executive receives in connection with
any other employment, or engagement as a consultant and/or independent
contractor, during the period such payments pursuant to 5(a) would have been
due and payable. For purposes of this 5(b), any fringe benefits received by
Executive in connection with any other employment that are reasonably
comparable, but not necessarily as beneficial, to Executive as the fringe
benefits then being provided by the Company pursuant to 5(a) hereof, shall be
deemed to be the equivalent of, and shall terminate the Company's responsibility
to continue providing, the fringe benefits then being provided by the Company if
Executive's employment with the Company is terminated pursuant to 5(a).
Executive shall have no duty to mitigate his damages and, specifically,
Executive shall have no obligation to seek any employment or engagement which
would generate payments or benefits that would constitute an offset hereunder.
(c) GENERAL RELEASE. Acceptance by Executive of any amounts
pursuant to this Section 5 shall constitute a full and complete release by
Executive of any and all claims Executive may have against the Company, any of
its past, present or future shareholders or any of their respective officers,
directors and affiliates (past, present or future), including, but not limited
to, claims he might have relating to Executive's cessation of employment with
the Company, or with respect to claims under Title VII of the Civil Rights Act
of 1964, the Age Discrimination in Employment Act of 1967, the Americans with
Disabilities Act of 1990, or any other
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similar Federal, state or local statute, rule or regulation; PROVIDED THAT,
there shall be properly excluded from the scope of such general release the
following:
i) claims that Executive may have against the Company for
reimbursement of ordinary and necessary business expenses incurred by him during
the course of his employment;
ii) claims that may be made by the Executive for payment of
Base Salary, fringe benefits, stock, or stock options properly due to him; and
iii) claims respecting matters for which the Executive is
entitled to be indemnified under the Company's Certificate of Incorporation or
Bylaws or indemnification agreements, respecting third party claims asserted or
third party litigation pending or threatened against the Executive.
A condition to Executive's receipt of any amounts pursuant to this 5 shall be
Executive's execution and delivery of a general release as described above.
Such payment shall be considered independent consideration made in exchange for
such release. In exchange for such release, the Company shall, if Executive's
employment is terminated without Cause, provide a release to Executive, but only
with respect to claims against Executive which are actually known to the Company
as of the time of such termination.
6. EFFECT OF CHANGE IN CONTROL.
(a) If a Change in Control (as hereinafter defined) shall occur
on or prior to the date specified in Section 3(a) hereof as the end of the Term,
then (i) if the remaining portion of the Term is less than two years, the Term
shall be automatically extended to a date which is 2 years from the date on
which such Change in Control is consummated ("Extended Term"), and, (ii) if
Executive's options, including warrants, have not fully vested, then upon
consummation of a Change in Control on or after the Effective Date, all
Executive options, including warrants, shall vest immediately upon such event.
In the event that Executive is terminated during the Extended Term the
provisions of Section 5 shall apply.
(b) As used herein, a "Change in Control" shall be deemed to have
occurred if, subsequent to the date hereof:
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i) any "person" (as such term is defined in Section 13(d) of
the Securities Exchange Act of 1934), other than (i) Apollo Advisors, L.P., Lion
Advisors, L.P., FMR Corp., Fidelity Management & Research Company, Fidelity
Management Trust Company, any other beneficial owner of the Company's common
stock as of the Effective Date, or (ii) any investment fund managed by, or firm
or group affiliated with any of the persons specified in clause (i) above, or
any of their respective affiliates, becomes the beneficial owner, directly or
indirectly, of either (A) a majority of the Company's outstanding common stock
or (B) securities of the Company representing a majority of the combined voting
power of the Company's then outstanding voting securities;
ii) a sale is made to any purchaser unaffiliated with the
Company or any of the persons specified in clause (1) above of all or
substantially all of the assets of the Company; or
iii) a merger or consolidation of the Company is made with
another corporation or other legal person unaffiliated with the Company or
any of the persons specified in clause (1) above if, immediately after such
merger or consolidation, less than a majority of the combined voting power of
the then-outstanding securities of such corporation or person are held,
directly or indirectly, in the aggregate by the holders immediately prior to
such transaction of the then-outstanding securities of the Company entitled
to vote generally in the election of the Board.
In no event shall the term "Change in Control" be construed to
include any change of control of the Company or any affiliate of the Company
solely as a result of any exchange of equity for debt securities of the
Company or any such affiliate upon consummation of a plan of reorganization
for the Company in the Bankruptcy Case.
(C) Notwithstanding any other provision of this Agreement, if
the aggregate present value of the "parachute payments" to the Executive,
determined under Section 280G(b) of the Internal Revenue Code of 1986, as
amended ("Code"), is at least three times the "base amount" determined under
such Section 280G, then the Base Salary otherwise payable under this
Agreement and any other amount payable hereunder or any other severance plan,
program, policy or obligation of the Company or any other affiliate thereof
shall be reduced so that the aggregate present value of the "parachute
payments" to the Executive, determined under Section 280G, does not exceed
2.99 times the base amount. In no event, however, shall any benefit
9
provided hereunder be reduced to the extent such benefit is specifically
excluded by Section 280G of the Code as a "parachute payment" or as an
"excess parachute payment." Any decisions regarding the requirement or
implementation of such reductions shall be made by such tax counsel as may be
selected by the Company and acceptable to Executive.
7. VOLUNTARY TERMINATION BY EXECUTIVE. Executive may terminate this
Agreement for any reason by giving the Company at least 180 days' written
notice of termination. The Company shall have no obligation to provide any
severance compensation under Section 5 in the event of Executive's voluntary
termination of this Agreement.
8. NONSOLICITATION OF EMPLOYEES. For a period of two years after
the termination or cessation of his employment with the Company for any
reason whatsoever, Executive shall not, on his own behalf or on behalf of any
other person, partnership, association, corporation, or other entity, solicit
or in any manner attempt to influence or induce any employee of the Company
or its subsidiaries or affiliates (known by the Executive to be such) to
leave the employment of the Company or its subsidiaries or affiliates, nor
shall he use or disclose to any person, partnership, association, corporation
or other entity any information obtained while an employee of the Company
concerning the names and addresses of the Company's employees.
9. NONDISCLOSURE OF TRADE SECRETS. During the term of this
Agreement, Executive will have access to and become familiar with various
trade secrets and proprietary and confidential information of the Company,
its subsidiaries and affiliates, including, but not limited to, processes,
computer programs, compilations of information, records, sales procedures,
customer and supplier requirements, pricing techniques, customer and supplier
lists, methods of doing business and other confidential information
(collectively referred to as "Trade Secrets") which are owned by the Company,
its subsidiaries and/or affiliates and regularly used in the operation of its
business, and as to which the Company, its subsidiaries and/or affiliates
take precautions to prevent dissemination to persons other than certain
directors, officers and employees. Executive acknowledges and agrees that
the Trade Secrets (1) are secret and not known in the industry; (2) give the
Company or its subsidiaries or affiliates an advantage over competitors who
do not know or use the Trade Secrets; (3) are of such value and nature as to
make it reasonable and necessary to protect and preserve the confidentiality
and secrecy of the Trade Secrets; and (4) are valuable, special and unique
assets of the Company or its subsidiaries or affiliates, the disclosure of
which could cause substantial injury and loss of profits
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and goodwill to the Company or its subsidiaries or affiliates. Executive may
not use in any way or disclose any of the Trade Secrets, directly or
indirectly, either during the term of this Agreement or at any time
thereafter, except as required in the course of his employment under this
Agreement, if required in connection with a judicial or administrative
proceeding, or if the information becomes public knowledge other than as a
result of an unauthorized disclosure by the Executive. All files, records,
documents, information, data and similar items relating to the business of
the Company, whether prepared by Executive or otherwise coming into his
possession, will remain the exclusive property of the Company and may not be
removed from the premises of the company under any circumstances without the
prior written consent of the Board (except in the ordinary course of business
during the Executive's period of active employment under this Agreement), and
in any event must be promptly delivered to the Company upon termination of
Executive's employment with the Company. Executive agrees that upon his
receipt of any subpoena, process or other request to produce or divulge,
directly or indirectly, any Trade Secrets to any entity, agency, tribunal or
person, Executive shall timely notify and promptly hand deliver a copy of the
subpoena, process or other request to the Board. For this purpose, Executive
appoints the Company (including any attorney retained by the Company), as his
true and lawful attorney-in-fact, to act in Executive's name, place and stead
to perform any act that Executive might perform to defend and protect against
any disclosure of any Trade Secrets.
10. EQUITABLE RELIEF. Executive acknowledges that the restrictions
contained in Sections 8 and 9 are, in view of the nature of the business of the
Company, reasonable and necessary to protect the legitimate interests of the
Company, that the company would not have entered into this Agreement in the
absence of such restrictions, and that any violation of any provisions of those
Sections will result in irreparable injury to the Company. Executive also
acknowledges that the remedy at law for any violation of these restrictions will
be inadequate and that the Company shall be entitled to temporary and permanent
injunctive relief prohibiting any such violation, without the necessity of
proving actual damages or the posting of an bond, and that the Company shall be
further entitled to an equitable accounting of all earnings, profits and other
benefits arising from any such violation, which rights shall be cumulative of
and in addition to any other rights or remedies to which the Company may be
entitled. In the event of any such violation, the Company shall be entitled to
commence an action for temporary and permanent injunctive relief and other
equitable relief in any court of competent jurisdiction and Executive further
irrevocably submits to the jurisdiction of any federal or state court in the
geographical jurisdiction of Seattle, Washington over any suit, action or
proceeding arising
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out of or relating to any asserted violation of Section 8 and/or 9.
Executive hereby waives, to the fullest extent permitted by law, any
objection that he may now or hereafter have to the jurisdiction of any
federal or state court in the geographical jurisdiction of Seattle,
Washington or to the venue of any such suit, action or proceeding brought in
such a court and any claim that such suit, action or proceeding has been
brought in an inconvenient forum. Effective service of process may be made
upon Executive by mail under the notice provisions contained in Section 14.
11. SEVERABILITY. The parties hereto intend all provisions of
Sections 8 and 9 hereof to be enforced to the fullest extent permitted by law.
Accordingly, should a court of competent jurisdiction determine that the scope
of any provision of Section 8 or 9 hereof is too broad to be enforced as
written, the parties intend that the court reform the provision to such narrower
scope as it determines to be reasonable and enforceable. In addition, however,
Executive agrees that the noncompetition, nonsolicitation and nondisclosure
agreements set forth above each constitute separate agreements independently
supported by good and adequate consideration and shall be severable from the
other provisions of, and shall survive, this Agreement. The existence of any
claim or cause of action of Executive against the Company, whether predicated on
this Agreement or otherwise, shall not constitute a defense to the enforcement
by the Company of the covenants of Executive contained in the noncompetition,
nonsolicitation and nondisclosure agreements. If any provision of this
Agreement is held to be illegal, invalid or unenforceable under present or
future laws effective during the term hereof, such provision shall be fully
severable and this Agreement shall be construed and enforced as if such illegal,
invalid or unenforceable provision never constituted a part of this Agreement;
and the remaining provisions of this Agreement shall remain in full force and
effect and shall not be affected by the illegal, invalid or unenforceable
provision or by its severance herefrom. Furthermore, in lieu of such illegal,
invalid or unenforceable provision, there shall be added as part of this
Agreement, a provision as similar in its terms to such illegal, invalid or
unenforceable provision as may be possible and be legal, valid and enforceable.
12. LEGAL EXPENSES; EXECUTIVE'S WARRANTY.
(a) The Company agrees to reimburse Executive for reasonable
attorneys' fees and disbursements incurred and to be incurred by Executive (net
of amounts previously advanced) in the making of this agreement, in seeking
approval of the Bankruptcy Court thereof in the Bankruptcy Case, and in
obtaining such other services as may be required by the Executive in connection
with the effect
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of the Bankruptcy Case on his employment by the Company. In the event that
the parties do not agree on the amount of such attorneys' fees the Bankruptcy
Court shall be requested to make such determination; provided, however, that
in no event shall the Company be required to pay attorneys' fees and
disbursements in excess of $10,000 after the date of the commencement of the
Bankruptcy Case.
(b) Executive affirms that his employment is not contrary to or
in breach of any lawful agreement or other obligation Executive has to The May
Department Stores Company, and that based upon information known to him as of
the date of this Agreement regarding the business of the Company, he does not
know or possess any trade secrets or proprietary information of The May
Department Stores Company, or any of its affiliates (including its parent) which
would provide the Company with an unfair advantage over such entities in the
retail apparel business, and, in any event, will not, and does not have any
intent to convey any trade secrets or proprietary information to the Company.
13. ARBITRATION - EXCLUSIVE REMEDY.
(a) Except as otherwise provided herein, the parties agree that
the exclusive remedy or method of resolving all disputes or questions arising
out of or relating to this Agreement shall be arbitration. Arbitration shall be
held in Seattle, Washington, presided over by one arbitrator. Any arbitration
may be initiated by either party by written notice ("Arbitration Notice") to the
other party specifying the subject of the requested arbitration.
(b) If the parties are unable to mutually select an arbitrator to
hear the matter, then the American Arbitration Association, upon application of
the initiating party, shall provide a panel of arbitrators from which the
parties shall select one to hear the matter.
(c) The arbitration proceeding shall be conducted in accordance
with the Rules for Resolution of Employment Disputes of the American Arbitration
Association. The administrative costs of arbitration (including the expense of
a party in preparing for and presenting the party's case at the arbitration and
of the fees and expenses of legal counsel to a party, all of which shall be
borne by that party), shall be borne by the Company only if Executive receives
substantially the relief sought by him in the arbitration; otherwise, the costs
shall be borne equally between the parties. The arbitration determination or
award shall be final
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and conclusive on the parties, and judgment upon such award may entered and
enforced in any court of competent jurisdiction.
14. MISCELLANEOUS.
(a) NOTICES. Any notices, consents, demands, requests, approvals
and other communications to be given under this Agreement by either party to the
other must be in writing and must be either (i) personally delivered, (ii)
mailed by registered or certified mail, postage prepaid with return receipt
requested, (iii) delivered by overnight express delivery service or same-day
local courier service, or (iv) delivered by telex or facsimile transmission, to
the address set forth below, or to such other address as may be designated by
the parties from time to time in accordance with this Section 14(a):
If to the Company: Lamonts Apparel, Inc.
00000 Xxxxxxx Xxxx X.X.
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Chief Financial Officer
Facsimile: (000) 000-0000
With a copy (which
shall not constitute
notice) to: Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxxx
If to Executive: Xxxx Xxxxxxxxxxx
Lamonts Apparel, Inc.
00000 Xxxxxxx Xxxx X.X.
Xxxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
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With a copy (which
shall not constitute
notice) to: Xxxxxxxx X. Xxxxxxxx
Xxxxx and Xxxxxxxx
000 Xxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Notices delivered personally or by overnight express delivery
service or by local courier service are deemed given as of actual receipt.
Mailed notices are deemed given three business days after mailing. Notices
delivered by telex or facsimile transmission are deemed given upon receipt by
the sender of the answer back (in the case of a telex) or transmission
confirmation (in the case of a facsimile transmission).
(b) ENTIRE AGREEMENT. This Agreement supersedes any and all
other agreements, either oral or written, between the parties with respect to
the subject matter of this Agreement and contains all of the covenants and
agreements between the parties with respect to the subject matter of this
Agreement.
(c) MODIFICATION. No change or modification of this Agreement
is valid or binding upon the parties, nor will any waiver of any term or
condition in the future be so binding, unless the change or modification or
waiver is in writing and signed by the parties to this Agreement.
(d) GOVERNING LAW. THE PARTIES ACKNOWLEDGE AND AGREE THAT THIS
AGREEMENT AND THE OBLIGATIONS AND UNDERTAKINGS OF THE PARTIES UNDER THIS
AGREEMENT WILL BE PERFORMED IN SEATTLE, WASHINGTON. THIS AGREEMENT IS
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
WASHINGTON, AND, WHERE APPLICABLE, THE LAWS OF THE UNITED STATES.
(e) COUNTERPARTS. This Agreement may be executed in
counterparts, each of which constitutes an original, but all of which
constitute one document.
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(f) ESTATE. If Executive dies prior to the expiration of the
term of employment or during a period when monies are owing to him, any monies
that may be due him from the Company under this Agreement as of the date of his
death shall be paid to his estate when and as otherwise payable.
(g) ASSIGNMENT. The Company shall have the right to assign this
Agreement to its successors or assigns. The terms "successors" and "assigns"
shall include any person, corporation, partnership or other entity that buys all
or substantially all of the Company's assets or a control block of stock of the
Company, or with which the Company merges or consolidates. The rights, duties
and benefits to Executive hereunder are personal to him, and no such right or
benefit may be assigned by him. The provisions of this clause (g) are all
subject to the provisions of Section 6.
(h) BINDING EFFECT. This Agreement is binding upon the parties
hereto, together with their respective executors, administrators, successors,
personal representatives, heirs and permitted assigns, and upon any Trustee
appointed in the Bankruptcy Case whether in the pending Chapter 11 case, in
any converted Chapter 7 case, or otherwise.
(i) WAIVER OF BREACH. The waiver by the Company or Executive
of a breach of any provision of this Agreement by Executive or the Company
may not operate or be construed as a waiver of any subsequent breach.
(j) COURT APPROVAL. This Employment Agreement is subject to
approval of the Bankruptcy Court in the Bankruptcy Case.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date set forth in the first paragraph.
XXXX XXXXXXXXXXX
---------------------------------
Xxxx Xxxxxxxxxxx
LAMONTS APPAREL, INC.
By:
---------------------------------
Name:
-----------------------------
Title:
-----------------------------
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