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EXHIBIT 10.12
AGREEMENT
1. This agreement ("Agreement") is entered into between Xxxxxx X. Xxxxxx
("Xxxxxx") and Xxxxx'x Jewelers, Inc., a California corporation ("Barry's"), to
set forth the severance arrangements Barry's has made for Xxxxxx and to resolve
all other matters between Barry's and Xxxxxx. Specifically, the purpose of this
Agreement is, among other things, to (i) set forth the parties' agreements
concerning severance and other benefits to be provided to Xxxxxx pursuant to the
Employment Agreement between the parties dated as of April 8, 1996 (the
"Employment Agreement"), as well as other benefits described herein, and (ii)
provide for mutual general releases. A copy of the Employment Agreement is
attached hereto as Exhibit "A".
2. The parties agree and acknowledge that Xxxxxx resigned as an officer,
director and employee of Barry's (and each of its subsidiary and affiliated
entities, as applicable) effective as of February 13, 1997.
3A. Pursuant to the Employment Agreement (as modified herein), Barry's
agrees to provide the following severance and other benefits to Xxxxxx:
3A.1 In accordance with Section 4.3(x) of the Employment Agreement,
$342,692.33 (the "Severance Amount"), computed as the amount of salary at
Xxxxxx'x rate of salary in effect immediately prior to February 13, 1997, for
the period from February 17, 1997 through April 8, 1998, payable in cash as
follows (subject to the last paragraph of this Section 3A): Xxxxxx will receive
monthly or biweekly payments from Barry's in the same amounts and with the same
periodicity that salary was paid to Xxxxxx immediately prior to February 13,
1997, commencing with the next regular payroll after that date and through and
including a final payment (on or about April 8, 1998) to fully satisfy the
Severance Amount. The Severance Amount does not include Xxxxxx'x salary for the
period up through and including February 16, 1997, which he acknowledges has
previously been paid in cash by Barry's.
3A.2 In accordance with Section 3.2 and Section 4.3 of the
Employment Agreement, the 10,000 shares of restricted Common Stock of Barry's
referred to therein is deemed immediately and fully vested as of February 13,
1997. Accordingly, Barry's has paid Xxxxxx $8,230.63 in cash, representing the
special bonus in respect of certain tax obligations of Xxxxxx (fully "grossed
up" for taxes) corresponding to one-half (1/2) of the restricted stock referred
to in said Section 3.2.
3A.3 In accordance with Section 3.2 and Section 4.3 of the
Employment Agreement, the stock options referred to therein are hereby deemed
immediately and fully vested as of February 13, 1997.
3A.4 In accordance with Section 3.7 and Section 4.3 of the
Employment Agreement and applicable law, Barry's will pay Xxxxxx $2,464.62 in
cash promptly following the execution date hereof, representing Barry's
obligation for accrued vacation benefits.
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3A.5 In accordance with Section 3.5 and Section 4.3 of the
Employment Agreement, for the period from February 13, 1997 through April 8,
1998, Xxxxxx shall continue to be included, at Barry's expense, in Barry's
medical insurance plan. This benefit shall be effected by Xxxxxx'x election of
COBRA coverage; Barry's will then pay or reimburse Xxxxxx for the cost of the
election of such coverage during the period specified in the preceding sentence.
In addition to the foregoing items of severance and benefits, nothing in this
Agreement shall be deemed to affect Xxxxxx'x benefits and rights under Barry's
401(k) plan and deferred compensation plan for senior managers (the "Tophat
Plan"); all rights and elections that may be available to Xxxxxx under the terms
of those plans with respect to his account interests therein shall continue to
be available to him. Among other things, in the event that Barry's elects to
terminate the Tophat Plan, then Xxxxxx shall have all of the rights specified
therein in connection with a termination. In addition, in the event of such a
termination of the Tophat Plan, Barry's agrees that it will establish a separate
"rabbi trust" for maintenance of funds previously elected to be deferred for tax
purposes by Xxxxxx, to enable Xxxxxx to continue to achieve deferral to the
maximum extent reasonably achievable under applicable tax law. All amounts
payable to Xxxxxx and other benefits to be provided to Xxxxxx in accordance with
this Section 3A and Section 3B below shall be subject to withholding in
accordance with applicable law.
3B. In addition to the benefits provided for in the Employment
Agreement, Barry's agrees to provide the following benefits to Xxxxxx:
3B.1 Barry's will pay the fees of an outplacement services firm for
outplacement services to be provided to Xxxxxx, up to a maximum of $25,000, upon
presentation of invoices and/or other appropriate supporting documentation
evidencing such fees.
3B.2 For the period from February 13, 1997 through April 8, 1998,
Xxxxxx shall continue to be included, at Barry's expense, in Barry's life
insurance and disability insurance plans.
3B.3 For the period from February 13, 1997 through April 8, 1998,
Barry's shall continue to provide the same automobile-related benefits to Xxxxxx
as provided under the existing Employment Agreement (including lease payments
and payment of maintenance, gas, oil, insurance and license as provided in the
existing Employment Agreement).
3C. In the event of Xxxxxx'x death prior to the full Severance Amount
having been paid as provided in Section 3A above, Barry's shall be obligated to
continue to provide such benefit to Xxxxxx'x spouse, subject to the terms and
elections available under the Tophat Plan, as applicable.
4. Xxxxxx agrees that he will comply with Section 9 of the Employment
Agreement, notwithstanding the termination of his employment by Barry's. In this
regard, Barry's acknowledges that Xxxxxx has made himself reasonably available
to Barry's for the purpose of returning confidential information to Barry's as
provided in said Section 9.
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Xxxxxx acknowledges, however, that Barry's has no means of independently
verifying full compliance by Xxxxxx with said Section 9, and as a result Xxxxxx
agrees that he will in the future fully comply with the document return and
other provisions of said Section.
5. Xxxxxx agrees that any and all claims or obligations, including any
claim for violation of any state or federal statute (such as statutes concerning
discrimination based on disability or perceived disability, race, sex, or
national origin), which he may have against Barry's are fully and completely
settled by this Agreement, and all liability or potential liability on any such
claim is hereby released. This release of claims includes claims against Barry's
directors, officers, employees and representatives (collectively,
"Representatives"), and against any and all present and future affiliated
companies of Barry's and their respective Representatives. This release also
includes all claims arising out of Xxxxxx'x employment with Barry's and the
termination of that employment, including all rights and benefits under the
Employment Agreement. Xxxxxx does not, by signing this Agreement, release claims
with respect to fulfillment of the promises contained in this Agreement. Barry's
(on behalf of itself and its present and future affiliated companies and their
respective Representatives) similarly agrees that any and all claims or
obligations which it may have against Xxxxxx relating to Xxxxxx'x service as an
officer, director and employee of Barry's are fully and completely settled by
this Agreement, and all liability or potential liability on any such claim is
hereby released. Barry's does not, by signing this Agreement, release claims
with respect to fulfillment of the promises contained in this Agreement.
6. Except as specifically noted in Section 5 above, each of Barry's and
Xxxxxx waives any and all rights it/he may have to invoke, or in any other way
to seek the benefits of, Section 1542 of the California Civil Code (or any other
similar statute). Section 1542 provides as follows:
A general release does not extend to claims which the creditor does not
know or suspect to exist in his favor at the time of executing the
release, which if known by him must have materially affected his
settlement with the debtor.
7. Xxxxxx understands and acknowledges that (a) this Agreement
constitutes a voluntary waiver of any and all claims he has against Barry's as
of the date of his execution of this Agreement, including claims under the Age
Discrimination in Employment Act of 1967, 29 U.S. C. Sec. 621 et seq.; (b) he
has waived any and all such claims pursuant to this Agreement and in exchange
for consideration, the value of which is substantial; (c) he has been, and is
now, advised to consult with an attorney concerning this Agreement before
signing it; (d) he has been, and is now, informed that he has a period of at
least 21 days to consider the terms of this Agreement (though he need not take
the full 21 days if he, in his sole discretion, does not wish to do so); and (e)
he may revoke this Agreement at any time during the 7 days following the date of
his signing of the Agreement, and this Agreement shall not become effective or
enforceable until the eighth day after Xxxxxx'x signing of the Agreement. If
Xxxxxx so revokes this Agreement, Xxxxxx agrees and acknowledges that Barry's
will likewise not be bound by the agreements set forth herein and will reserve
the right, among others, to assert that Xxxxxx'x termination is for "cause"
under the Employment Agreement, seek a return of the Severance Amount and other
benefits described in Section 3 above and seek other remedies available at law
or in equity.
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8. Each party agrees that this Agreement is confidential and neither
will voluntarily disclose its terms, except that Xxxxxx and the management of
Barry's may discuss the Agreement with their spouses, their attorneys, and their
tax advisers (including, in the case of Barry's management, Barry's attorneys
and tax advisers).
9. In connection with Xxxxxx'x separation from Barry's, Barry's is
providing a reference letter, addressed to Xxxxxx, in the form attached hereto
as Exhibit "B".
10. Xxxxxx promises that he will not in the future file a claim against
Barry's with respect to a matter released herein. Barry's promises that it will
not in the future file a claim against Xxxxxx with respect to a matter released
herein.
11. If either Barry's or Xxxxxx files a claim to enforce this Agreement
or a claim otherwise arising in any way out of this Agreement, the claim will be
decided by binding and final arbitration. The procedures for conducting that
arbitration will be decided by the parties.
12. Each party acknowledges that he or it has had an opportunity to
negotiate with regard to the terms of this Agreement, to receive advice with
regard to it, and carefully to read and consider the terms of the Agreement
before signing it.
13. This Agreement contains the entire agreement of Barry's and Xxxxxx
concerning the subjects covered in the Agreement. This Agreement supersedes any
previous discussions or agreements about those subjects.
Date: 3/19/97 /Xxxxxx X. Xxxxxx/
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Xxxxxx X. Xxxxxx
Date: BARRY'S JEWELERS, INC.
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By:/Xxxxxxx Xxxxxx/
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Its: Chairman of the Board of Directors
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