EXHIBIT NO. 10.33
EXECUTIVE SEVERANCE AGREEMENT
WITH RESPECT TO CHANGE OF CONTROL
BETWEEN
XXXXXX FASHIONS CORPORATION
AND
XXXXXX X. XXXXXX
THIS EXECUTIVE SEVERANCE AGREEMENT is effective as of March 1, 2000, by and
between Xxxxxx Fashions Corporation, a corporation duly organized and existing
under the laws of the State of Delaware (the "Corporation") and Xxxxxx X. Xxxxxx
("Executive").
ARTICLE 1
EMPLOYMENT
1.1 The Corporation hereby employs Executive, and Executive agrees to work
for the Corporation as Chief Financial Officer and to perform such related
duties as are assigned to him from time to time by the Chief Executive Officer
of the Corporation. Executive's employment with the Company is "at will"
meaning that Executive or the Corporation will be entitled to terminate
Executive's employment at any time for any reason, with or without Cause (as
defined below).
ARTICLE 2
DEFINITIONS
2.1 "Cause" shall mean (i) any fraud, misappropriation or embezzlement by
Executive in connection with the business of the Corporation, (ii) any
conviction of a felony or a gross misdemeanor by Executive that has or can
reasonably be expected to have a detrimental effect on the Corporation, (iii)
any gross neglect or persistent neglect by Executive to perform the duties
assigned to him hereunder or any other act that can be reasonably expected to
cause substantial economic or reputational injury to the Company or (iv) any
material breach of Section 3 of this Agreement, provided that the existence of
such neglect or material breach shall be determined by the written agreement of
the majority of the directors. Provided further that in connection with an
event described in Section 2.1(iii) above, Executive shall first have received a
written notice from the Corporation which sets forth in reasonable detail the
manner in which Executive has grossly or persistently neglected his duties and
Executive shall have a period of ten (10) days to cure the same, but the
Corporation shall not be required to give written notice of, nor shall Executive
have a period to cure, the same or any similar gross or persistent neglect or
material breach which the Corporation has previously given written notice to
Executive hereunder and Executive has cured such neglect or breach.
2.2 A "Change of Control" shall be deemed to have occurred if (i) there
shall be consummated (A) any consolidation or merger in which the Corporation is
not the continuing or surviving corporation or pursuant to which shares of the
Corporation's common stock would be converted into cash, securities or other
property, other than a consolidation or a merger having the same proportionate
ownership of common stock of the surviving corporation immediately after the
consolidation or merger or (B) any sale, lease, exchange or other transfer (in
one transaction or a series of related transactions other than in the ordinary
course of business of the Corporation) of all, or substantially all, of the
assets of the Corporation to any corporation, person or other entity which is
not a direct or indirect wholly-owned subsidiary of the Corporation, or (ii) any
person, group, corporation or other entity (collectively, "Persons") shall
acquire beneficial ownership (as determined pursuant to Section 13(d) of the
Securities Exchange Act of 1934, as amended, and rules and regulations
promulgated hereunder) of 50% or more of the Corporation's outstanding common
stock.
2.3 "Confidential Information" means any information that is not generally
known, including trade secrets, outside the Corporation and that is proprietary
to the Corporation, relating to any phase of the Corporation's existing or
reasonably foreseeable business which is disclosed to Executive during
Executive's employment by the Corporation including information conceived,
discovered or developed by Executive. Confidential Information includes, but is
not limited to, business plans; financial statements and projections; operating
forms (including contracts) and procedures; payroll and personnel records;
marketing materials and plans; proposals; supplier information; customer
information; software codes and computer programs; customer lists; project
lists; project files; training manuals; policies and procedures manuals; health
and safety manuals; target lists for new stores and information relating to
potential new store locations; price information and cost information;
administrative techniques or documents or information that is designated by the
Corporation as "Confidential" or similarly designated.
ARTICLE 3
CONFIDENTIAL INFORMATION AND TRADE DOCUMENTS
3.1 Unless authorized in writing by the Corporation, Executive will not
directly or indirectly divulge, either during or after the term of his
employment, or until such information becomes generally known, to any person not
authorized by the Corporation to receive or use it any Confidential Information
for any purpose whatsoever.
3.2 All documents or other tangible property relating in any way to the
business of the Corporation which are conceived by Executive or come into his
possession during his employment shall be and remain the exclusive property of
the Corporation and Executive agrees to return all such documents and tangible
property to the Corporation upon termination of his employment, or at such
earlier time as the Corporation may request of Executive.
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ARTICLE 4
CHANGE OF CONTROL
4.1 If a Change of Control shall occur, the Executive shall be entitled to
receive from the Corporation or its successor the full base salary of Executive
under this Agreement for one (1) year in one cash installment. This payment
shall be made by the Corporation within ten (10) business days of consummating
the terms and conditions of the transaction which give rise to the Change of
Control in which such employment was terminated.
4.2 If a Change of Control shall occur during the term of this Agreement,
all unvested rights to purchase stock under outstanding stock options held by
Executive shall vest immediately for the benefit of the Executive and the Board
of Directors will use its reasonable efforts to register such shares under the
Securities Act of 1933, as amended, if necessary.
4.3 If a Change of Control shall occur during the term of this Agreement,
Executive shall be entitled to twelve (12) months of continuation of health
insurance benefits.
ARTICLE 5
"AT WILL" EMPLOYMENT
5.1 The Corporation may terminate the Executive's employment at any time
and at such time all compensation and benefits provided to Executive under this
Agreement shall immediately cease, subject to applicable employment laws and
regulations.
ARTICLE 6
ASSIGNMENT
6.1 The Corporation shall not have the right to assign this Agreement to
its successors or assigns without the written consent of the Executive;
provided, however, the Corporation shall have the right to assign this Agreement
to any subsidiary, and all covenants or agreements hereunder shall inure to the
benefit of and be enforceable by or against its successors or assigns.
6.2 The terms "successors" and "assigns" shall include any corporation
which buys all or substantially all of the Corporation's assets, or a
controlling portion of its stock, or with which it merges or consolidates.
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ARTICLE 7
FAILURE TO DEMAND PERFORMANCE AND WAIVER
7.1 The Corporation's failure to demand strict performance and compliance
with any part of this Agreement during the Executive's employment shall not be
deemed to be a waiver of the Corporation's rights under this Agreement or by
this operation of law. Any waiver by either party of a breach of any provision
of this Agreement shall not operate as or be construed as a waiver of any
subsequent breach thereof.
ARTICLE 8
ENTIRE AGREEMENT
8.1 The Corporation and Executive acknowledge that this Agreement contains
the full and complete agreement between and among the parties, that there are no
oral or implied agreements or other modifications not specifically set forth
herein, and that this Agreement supersedes any prior agreements or
understandings, if any, between the Corporation and Executive, whether written
or oral. The parties further agree that no modifications of this Agreement may
be made except by means of a written agreement or memorandum signed by the
parties.
ARTICLE 9
GOVERNING LAW
9.1 The parties acknowledge that the Corporation's principal place of
business is located in the State of Minnesota. The parties hereby agree that
this Agreement shall be construed in accordance with the internal laws of the
State of Minnesota without regard to the conflict of laws thereof.
* * * * * * * * * *
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IN WITNESS WHEREOF, the Corporation has hereunto signed its name and the
Executive hereunder has signed his name, all as of the day and year first above
written.
XXXXXX FASHIONS CORPORATION
/s/ Xxxxxx Xxxxxxxxxx By: /s/ Xxxxxxx X. Xxxxxx
-------------------------- ------------------------------------------
Witness Its: CEO
---------------------------------
EXECUTIVE
/s/ Xxxxxx Xxxxxxxxxx /s/ Xxxxxx X. Xxxxxx
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Witness Xxxxxx X. Xxxxxx
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