Exhibit 10(xi)
EMPLOYMENT AGREEMENT
This AGREEMENT (the "Agreement") is made as of November 4, 1999 (the
"Agreement Date"), by and between The Stride Rite Corporation, a Massachusetts
corporation with its headquarters located in Lexington, Massachusetts (the
"Employer"), and Xxxxx X. Xxxxxxxxxxx (the "Executive"). In consideration of the
mutual covenants contained in this Agreement, the Employer and the Executive
agree as follows:
1. Employment. The Employer agrees to employ the Executive and the
Executive agrees to be employed by the Employer on the terms and conditions
set forth in this Agreement. The Executive's active employment shall
commence on November 15, 1999 (the "Start Date").
2. Capacity/Duties. The Executive shall serve the Employer as Chairman and
Chief Executive Officer of the Employer. The Executive shall also serve the
Employer in such other or additional related offices as the Executive may
reasonably be requested to serve by the Board. The Executive shall be based at
the Employer's headquarters in Lexington, Massachusetts, or such other
headquarters as may be established by the Employer. The Executive shall have
overall responsibility for the general management of the Employer, subject to
the direction and authority of the Board of Directors of the Employer (the
"Board"). The Executive shall preside at all meetings of the Board and shall be
responsible for formulating and submitting to the Board matters of general
policy for the Employer. The Executive additionally shall be responsible for the
general supervision and control of the business and affairs of the Employer,
subject in each case to the direction and authority of the Board. The Executive
shall be responsible for developing, maintaining and enhancing the Employer's
relationships and reputation with investors, customers, suppliers, analysts and
the public at large. The Executive shall also perform such other duties as
normally are incident to the office of Chief Executive Officer. The Executive
acknowledges that his responsibilities in these capacities will require a
substantial time commitment, frequent travel, and availability at any time the
needs of the business so require. The Executive acknowledges the foregoing
requirements of the position and represents that he is fully capable of
performing the responsibilities from and after the Start Date. The Executive
agrees that during his employment with the Employer his primary residence and
that of his family will be in the greater Boston, Massachusetts area.
3. Term. Subject to the provisions of Section 6, the term of
employment pursuant to this Agreement shall commence on the Start Date and
end on November 30, 2002 (the "Term").
4. Compensation and Benefits. The regular compensation and benefits
payable to the Executive under this Agreement shall be as follows:
(a) Salary. For all services rendered by the Executive under this
Agreement, the Employer shall pay the Executive a salary (the "Salary")
at the annual rate of Six Hundred Thousand Dollars ($600,000), subject
to increase from time to time in the discretion of the Board or the
Compensation Committee of the Board (the "Compensation Committee"),
which will review the Salary at least annually. The
Salary shall be payable in periodic installments in accordance with the
Employer's usual practice for its senior executives. Any increase in the
Executive's Salary shall not serve to limit or reduce any other obligation
of the Employer hereunder and, after any such increase, the Executive's
Salary shall not be reduced.
(b) Bonus. Commencing during the Employer's 2000 fiscal year, the
Executive shall be an "Eligible Employee" as that term is defined in the
Employer's Annual Incentive Compensation Plan (the "Annual Incentive
Plan") and may receive incentive compensation as provided by its terms.
Pursuant to the Annual Incentive Compensation Plan, the Executive's "Bonus
Percentage" (as defined) will be fifty percent (50%). The Executive's
participation in the Annual Incentive Plan is subject to the terms and
conditions of such plan, or any amended version of such plan or any
successor or other annual incentive compensation plan which may be adopted
and become legally effective during the Term. The Executive is also
eligible to participate in the 1999 Executive Long-Term Bonus Plan in
accordance with the terms and provisions of such plan. The Executive's
level of participation will be as stated for the previous Chief Executive
Officer of the Employer, pro-rated for the number of months of actual
service of the Executive.
(c) Stock Options. Effective as of the Start Date, the Executive is being
awarded a non-qualified stock option to purchase up to Five Hundred
Thousand (500,000) shares of the Employer's common stock at fair market
value, which shall be the price at the close of trading on the New York
Stock Exchange - Composite Index on the trading day immediately prior to
the Employer's public announcement of the Executive's appointment to the
position of Chairman and Chief Executive Officer. The non-qualified stock
option as set forth herein shall vest upon issuance on the Start Date as
to one hundred thousand (100,000) shares, with the balance to vest ratably
in annual increments over a period of three (3) years, with the first
deferred vesting date being the first anniversary of the Start Date. At
the Board's discretion, additional grants of stock options may be awarded
to the Executive, from time to time, under the prevailing terms and
conditions of the Employer's current Stock Option Plan(s) or any successor
plan.
(d) Regular Benefits. The Executive shall be entitled to participate in
any employee benefit plans, medical insurance plans, life insurance plans,
disability income plans, retirement plans and other benefit plans which
the Employer may from time to time have in effect for all or most of its
senior executives. Such participation shall be subject to the terms of the
applicable plan documents, generally applicable policies of the Employer,
applicable law and the discretion of the Board, the Compensation Committee
or any administrative or other committee provided for in or contemplated
by any such plan. Nothing contained in this Agreement shall be construed
to create any obligation on the part of the Employer to establish any such
plan or to maintain the effectiveness of any such plan which may be in
effect from time to time.
(e) Car Allowance. The Executive shall receive a car allowance of
Ten Thousand Dollars ($10,000) per year, prorated and payable in
regular
installments coinciding with the Employer's normal pay periods for
senior executives.
(f) Vacation. The Executive shall be entitled to four (4) weeks paid
vacation per year. Any carryover of unused vacation from one annual period
to the next shall be subject to the policies and practices applicable to
other senior executives of the Employer.
(g) Relocation. The Executive shall be entitled to the benefits relating
to the relocation of his residence from San Francisco, California, to the
greater Boston, Massachusetts area, as provided in Exhibit A, Relocation,
attached hereto and incorporated by reference.
(h) Expenses. During the Employment Period, the Executive shall be
entitled to receive prompt reimbursement for all reasonable expenses
incurred by the Executive in accordance with the policies and practices of
the Employer as in effect from time to time with respect to executives
employed by the Employer.
(i) Taxation of Payments and Benefits. The Employer shall undertake to
make deductions, withholdings and tax reports with respect to payments and
benefits under this Agreement to the extent that it reasonably and in good
faith believes that it is required to make such deductions, withholdings
and tax reports. Payments under this Agreement shall be in amounts net of
any such deductions or withholdings. Except as provided in Exhibit A and
as provided in the CoC Agreement, nothing in this Agreement shall be
construed to require the Employer to make any payments to compensate the
Executive for any adverse tax effect associated with any payments or
benefits or for any deduction or withholding from any payment or benefit.
(j) Exclusivity of Salary and Benefits. The Executive shall not be
entitled to any payments or benefits other than those provided under this
Agreement.
5. Extent of Service. During the Executive's employment under this
Agreement, the Executive shall, subject to the direction and supervision of the
Board, devote the Executive's full business time, best efforts and business
judgment, skill and knowledge to the advancement of the Employer's interests and
to the discharge of the Executive's duties and responsibilities under this
Agreement. The Executive shall not engage in any other business activity, except
as may be approved by the Board; provided that nothing in this Agreement shall
be construed as preventing the Executive from:
(a) investing the Executive's assets in any company or other entity in a
manner not prohibited by Section 7(d) and in such form or manner as shall
not require any material activities on the Executive's part in connection
with the operations or affairs of the companies or other entities in which
such investments are made;
(b) engaging in religious, charitable or other community or non-profit
activities that do not impair the Executive's ability to fulfill the
Executive's duties and responsibilities under this Agreement; or
(c) serving as a director on the board of directors of Keeco
Corporation, Guckenheimer Enterprises, Inc., Wild Oats, Inc. or
Hugger-Mugger, Inc., or of other companies with the prior reasonable
approval of the Board.
6. Termination and Termination Benefits. Notwithstanding the
provisions of Section 3, the Executive's employment under this Agreement
shall terminate under the following circumstances set forth in this Section 6.
(a) Termination by the Employer for Cause. The Employer may terminate the
Executive's employment for "Cause" upon a vote of the majority of the
members of the Board and written notice to the Executive. For purposes of
this Agreement, the following shall constitute "Cause" for such
termination:
(i) conviction of or plea of no contest to a felony or any
crime of moral turpitude or admitting the commission of same;
(ii) fraudulent conduct in connection with the business or affairs
of the Employer or any affiliate of the Employer, regardless of
whether said conduct is designed to defraud the Employer or others;
(iii) the willful and continued failure of the Executive to perform
substantially the Executive's duties with the Employer (other than
any such failure resulting from incapacity due to physical or mental
illness), not cured within fifteen (15) business days after a
written demand for substantial performance is delivered to the
Executive by the Board which specifically identifies the manner in
which the Board believes that the Executive has not substantially
performed the Executive's duties;
(iv) willful engagement by the Executive in conduct or
misconduct which is substantially injurious to the Employer,
monetarily or otherwise; or
(v) any intentional use or intentional appropriation for his use or
benefit of any funds or properties of the Employer not authorized by
the Board, or any material breach by the Executive of the
Executive's obligations under the Employer's Conflict of Interest
Policy or similar conflicts or self-dealing policies promulgated in
writing from time to time, or his fiduciary duty of loyalty to the
Employer.
For purposes of this paragraph, no act, or failure to act, on the
Executive's part shall be considered "willful" unless done, or omitted to
be done, by the Executive in bad faith without reasonable belief that his
action or omission was in the best interests of the Employer.
(b) Termination by the Executive. The Executive's employment under this
Agreement may be terminated by the Executive by written notice to the
Board at least ninety (90) days prior to such termination.
(c) Termination by the Employer Without Cause. The Executive's employment
under this Agreement may be terminated by the Employer without Cause upon
a vote of the majority of the members of the Board and written notice to
the Executive.
(d) Termination by the Executive for Good Reason. The Executive may
terminate his employment at any time for Good Reason. For purposes of this
Agreement, "Good Reason" means the good faith determination by the
Executive that any one or more of the following have occurred:
(i) without the express written consent of the Executive, the
Employer effects any material change(s) in any of the duties,
authority, or responsibilities of the Executive which is (are)
inconsistent in any substantial respect with the Executive's
position, authority, duties, or responsibilities as contemplated by
Section 2 of this Agreement, which action is not remedied by the
Employer promptly after receipt of notice thereof given by the
Executive; or
(ii) any failure by the Employer to comply with any of the
provisions of Section 4 of this Agreement, other than an
insubstantial and inadvertent failure remedied by the Employer
promptly after receipt of notice thereof given by the Executive.
(e) Certain Termination Benefits. Unless otherwise specifically provided
in this Agreement or otherwise required by law, all compensation and
benefits payable to the Executive under this Agreement shall cease to
accrue on the date of termination of the Executive's employment under this
Agreement. Notwithstanding the foregoing, in the event of termination of
the Executive's employment with the Employer pursuant to Section 6(c) or
Section 6(d) above and subject to the Executive's execution and delivery
to the Employer of an irrevocable release of claims, in a form reasonably
satisfactory to the Employer and the Executive, the Employer shall provide
to the Executive the following termination benefits ("Termination
Benefits"):
(i) continuation of the Executive's Salary at the rate then in
effect pursuant to Section 4(a);
(ii) an amount equal to the bonus (prorated as provided herein) that
would have been paid the Executive pursuant to the Employer's
current Annual Incentive Plan or its successor, had the Executive's
employment not been terminated prior to the end of the then
applicable Annual Incentive Plan period, provided, however, that
such amount shall be prorated to reflect the period ending with the
fiscal quarter in which the Date of Termination occurred, and the
said resulting amount is to be paid to the Executive no later than
such time as the Employer pays its other executives under the Annual
Incentive Plan;
(iii) continuation of group health plan benefits to the extent
authorized by and consistent with 29 X.X.X.xx. 1161 et seq.
(commonly known as "COBRA"), with the cost of the regular
premium for such benefits shared in the same relative proportion
by the Employer and the Executive as in effect on the Date of
Termination; and
(iv) provided the date of the termination of the Executive's
employment with the Employer is prior to the first anniversary of
the Start Date, the benefits set forth in Section 3 of Exhibit A
relating to the relocation of his residence from the greater Boston,
Massachusetts area to San Francisco, California or another residence
location within the contiguous United States selected by the
Executive in the Termination Benefits Period.
The Termination Benefits set forth in (i) and (iii) above shall continue
after the date of termination for a period of twelve (12) months; provided
that in the event that the Executive commences any employment or
self-employment during the period during which the Executive is entitled
to receive Termination Benefits (the "Termination Benefits Period"), the
remaining amount of Salary due pursuant to Section 6(e)(i) for the period
from the commencement of such employment or self-employment to the end of
the Termination Benefits Period shall be reduced by the amount of gross
compensation which the Executive is entitled to receive from the new
employer or self-employment and the payments provided under Section
6(e)(iii) shall cease effective as of the date of commencement of such
employment or self-employment. Notwithstanding the foregoing, nothing in
this Section 6(e) shall be construed to affect the Executive's right to
receive COBRA continuation entirely at the Executive's own cost to the
extent that the Executive may continue to be entitled to COBRA
continuation after the Executive's right to cost sharing under Section
6(e)(iii) ceases. The Executive shall be obligated to give prompt notice
of the date of commencement of any employment or self-employment during
the Termination Benefits Period and shall respond promptly to any
reasonable inquiries concerning any employment or self-employment in which
the Executive engages during the Termination Benefits Period.
(f) Disability. The Employer may terminate this Agreement, after having
established the Executive's inability to perform the essential functions
of the Executive's then existing position or positions with or without
reasonable accommodation, and if any questions arise as to whether the
Executive is disabled so as to be unable to resume or continue performance
and execution of such essential duties within a period not to exceed sixty
(60) days in duration, the Executive may, and at the request of the
Employer shall, submit to the Employer a certification in reasonable
detail by a physician selected by the Employer to whom the Executive or
the Executive's guardian has no reasonable objection as to whether the
Executive is so disabled or how long such disability is expected to
continue, and such certification shall, for the purposes of this
Agreement, be conclusive of the issue. The Executive hereby agrees and
acknowledges that even relatively short period of disability may prevent
him from being able to perform the essential functions of his position,
particularly during the start-up phase of his employment and that it would
not be reasonable for the Employer to accommodate such a disability by
reducing the Executive's duties or by allowing a leave of absence that
would extend for more than
sixty (60) days. The Executive agrees to cooperate with any reasonable
request of the physician in connection with such certification. If such
question shall arise and the Executive shall fail to submit to such
certification, the Employer's determination of such issue shall be final
and binding on the Executive. The Board may exercise the Employer's right
to terminate the Agreement by giving to the Executive written notice of
termination (the "Disability Notice"), and his employment with the
Employer shall terminate effective on the 30th day after receipt of such
notice (the "Disability Effective Date"). Notwithstanding any such
Termination, the Executive shall continue to receive the Executive's full
Salary (less any disability pay or sick pay benefits to which the
Executive may be entitled under the Employer's policies) and benefits
under Section 4(d) of this Agreement (except to the extent that the
Executive may be ineligible for one or more such benefits under applicable
plan terms) for a period of one year dating from the Disability Effective
Date.
(g) Termination Pursuant to a Change of Control. Effective as of the Start
Date, the Employer and the Executive are entering into the Employer's
standard Change of Control Employment Agreement ("CoC Agreement") as
previously approved by the Board. Notwithstanding anything to the contrary
contained herein, in the event of a Change of Control, as defined in the
CoC Agreement, the terms of the CoC Agreement shall govern. Absent a
Change of Control, as so defined, the terms of this Agreement shall
govern.
(h) Non-exclusivity of Rights. Nothing in this Agreement shall prevent or
limit the Executive's continuing or future participation in any benefit,
bonus, incentive or other plan or program provided by the Employer and for
which the Executive qualifies, nor shall anything herein limit or
otherwise affect such rights as the Executive may have under any stock
option or other agreement with the Employer or any of its affiliates.
Except as otherwise provided herein, amounts which are vested benefits or
which the Executive is otherwise entitled to receive under any plan or
program of the Employer at or subsequent to the Date of Termination shall
be payable in accordance with such plan or program.
(i) Date of Termination. "Date of Termination" means the date of actual
receipt of the Notice of Termination or any later date specified therein
(but not more than fifteen (15) days after the giving of the Notice of
Termination), as the case may be; provided that (i) if the Executive's
employment is terminated by the Employer for any reason other than Cause
or Disability, the Date of Termination is the date on which the Employer
notifies the Executive of such termination; (ii) if the Executive's
employment is terminated due to Disability, the Date of Termination is the
Disability Effective Date; and (iii) if the Executive's employment is
terminated due to the Executive's death, the Date of Termination shall be
the date of death.
7. Confidential Information, Noncompetition and Cooperation.
(a) Confidential Information. As used in this Agreement,
"Confidential Information" means information belonging to the Employer
which is of value to the Employer in the course of conducting its
business and the disclosure of which could result in a competitive or
other disadvantage to the Employer. Confidential Information includes,
without limitation, financial information, reports, and forecasts;
inventions, improvements and other intellectual property; trade secrets;
know-how; designs, processes or formulae; software; market or sales
information or plans; customer lists; and business plans, prospects and
opportunities (such as possible acquisitions or dispositions of businesses
or facilities) which have been discussed or considered by the management
of the Employer. Confidential Information includes information developed
by the Executive in the course of the Executive's employment by the
Employer, as well as other information to which the Executive may have
access in connection with the Executive's employment. Confidential
Information also includes the confidential information of others with
which the Employer has a business relationship. Notwithstanding the
foregoing, Confidential Information does not include information in the
public domain, unless due to breach of the Executive's duties under
Section 7(b), or information known to the Executive prior to the Agreement
Date.
(b) Confidentiality. The Executive understands and agrees that the
Executive's employment creates a relationship of confidence and trust
between the Executive and the Employer with respect to all Confidential
Information. At all times, both during the Executive's employment with the
Employer and after its termination, the Executive will keep in confidence
and trust all such Confidential Information, and will not use or disclose
any such Confidential Information without the written consent of the
Employer, except as may be necessary in the ordinary course of performing
the Executive's duties to the Employer.
(c) Documents, Records, etc. All documents, records, data, apparatus,
equipment and other physical property, whether or not pertaining to
Confidential Information, which are furnished to the Executive by the
Employer or are produced by the Executive in connection with the
Executive's employment will be and remain the sole property of the
Employer. The Executive will return to the Employer all such materials and
property as and when requested by the Employer. In any event, the
Executive will return all such materials and property immediately upon
termination of the Executive's employment for any reason. The Executive
will not retain with the Executive any such material or property or any
copies thereof after such termination.
(d) Noncompetition and Nonsolicitation. During the Term and for twelve
(12) months thereafter, the Executive (i) will not, directly or
indirectly, whether as owner, partner, shareholder, consultant, agent,
employee, co-venturer or otherwise, engage, participate, assist or invest
in any Competing Business (as hereinafter defined); (ii) will refrain from
directly or indirectly employing, attempting to employ, recruiting or
otherwise soliciting, inducing or influencing any person to leave
employment with the Employer (other than terminations of employment of
subordinate employees undertaken in the course of the Executive's
employment with the Employer); and (iii) will refrain from soliciting or
encouraging any customer or supplier to terminate or otherwise modify
adversely its business relationship with the Employer. The Executive
understands that the restrictions set forth in this
Section 7(d) are intended to protect the Employer's interest in its
Confidential Information and established employee, customer and supplier
relationships and goodwill, and agrees that such restrictions are
reasonable and appropriate for this purpose. For purposes of this
Agreement, the term "Competing Business" shall mean a business conducted
anywhere in the United States which is competitive with any business which
the Employer or any of its subsidiaries conducts or proposes to conduct at
any time during the employment of the Executive, including, but not
limited to, specialty retailing of infant's, toddler's and children's
footwear, the design or manufacture of footwear of any type on the
wholesale level, and any and all components of the foregoing.
Notwithstanding the foregoing, the Executive may (i) own up to one percent
(1%) of the outstanding stock of a publicly held corporation which
constitutes or is affiliated with a Competing Business and (ii) retain and
exercise any and all stock, stock options and other stock-related rights
presently held by him in Genesco Inc. Notwithstanding the foregoing
provisions of this Section 7(d), if the Executive's employment is
terminated by the Employer other than for Cause or disability, or if the
Executive terminates his employment pursuant to Section 6(d), Section
7(d)(i) will not apply if, within thirty (30) days after such termination,
the Executive elects in writing to waive any further Termination Benefits
under Section 6(e).
(e) Third-Party Agreements and Rights. The Executive hereby confirms that,
to the best of his knowledge and belief, the Executive is not bound by the
terms of any written agreement with any previous employer or other party
which restricts in any way the Executive's use or disclosure of
information or the Executive's engagement in any business. The Executive
represents to the Employer that the Executive's execution of this
Agreement, the Executive's employment with the Employer and the
performance of the Executive's proposed duties for the Employer will not
violate any obligations the Executive may have to any such previous
employer or other party. In the Executive's work for the Employer, the
Executive will not disclose or make use of any information in violation of
any agreements with or rights of any such previous employer or other
party, and the Executive will not bring to the premises of the Employer
any copies or other tangible embodiments of non-public information
belonging to or obtained from any such previous employment or other party.
(f) Litigation and Regulatory Cooperation. During and after the
Executive's employment, the Executive shall cooperate reasonably with the
Employer in the defense or prosecution of any claims or actions now in
existence or which may be brought in the future against or on behalf of
the Employer which relate to events or occurrences that transpired while
the Executive was employed by the Employer. The Executive's cooperation in
connection with such claims or actions shall include, but not be limited
to, being reasonably available to meet with counsel to prepare for
discovery or trial and to act as a witness on behalf of the Employer at
mutually convenient times. During and after the Executive's employment,
the Executive also shall cooperate reasonably with the Employer in
connection with any investigation or review of any federal, state or local
regulatory authority as any such investigation or review relates to events
or occurrences that transpired while the Executive was
employed by the Employer. The Employer shall reimburse the Executive for
any reasonable out-of-pocket expenses incurred in connection with the
Executive's performance of obligations pursuant to this Section 7(f). The
Employer shall compensate the Executive for services pursuant to this
Section 7(f) rendered after the first anniversary of the termination of
the Executive's employment with the Employer, at a reasonable per diem
rate.
(g) Nondisparagement. During the Executive's employment and for a period
of twelve (12) months from the date of termination of the Executive's
employment with the Employer, the Executive agrees not to take any action
or make any statement, written or oral, to any current or former employee
of the Employer or to any other person which disparages the Employer, its
officers, directors, management, business practices, or xxxxx the
reputation of the Employer with its customers, suppliers, or the public.
(h) Standstill Agreement . For a period of twelve (12) months from the
date of termination of the Executive's employment with the Employer, the
Executive agrees not to, directly or indirectly: (a) effect or seek, offer
or propose (whether publicly or otherwise) to effect, or cause to
participate in or in any way assist any other person to effect or seek,
offer or propose (whether publicly or otherwise) to effect, or cause or
participate in, (i) any acquisition of any securities (or beneficial
ownership thereof) or assets of the Employer; (ii) any tender or exchange
offer, merger or other business combination involving the Employer; (iii)
any recapitalization, restructuring, liquidation, dissolution or other
extraordinary transaction with respect to the Employer; or (iv) any
"solicitation" of "proxies" (as such terms are used in the proxy rules of
the Securities and Exchange Commission) to vote any voting securities of
the Employer; (b) form, join or in any way participate in a "group" (as
defined in the 0000 Xxx) or otherwise act, alone or in concert with
others, to seek to control or influence the management, Board of Directors
or policies of the Employer; (c) take any action which might force the
Employer to make a public announcement regarding any of the types of
matters set forth in subsection (a) above; or (d) enter into any
discussions or arrangements with any third party with respect to any of
the foregoing. The restrictions contained in this paragraph shall not be
applicable to purchases solely for investment purposes aggregating less
then 5% of the Employer's outstanding voting securities.
(i) Injunction. The parties agree that it would be difficult to measure
any damages caused which might result from any breach by the Executive or
the Employer of the promises set forth in this Section 7, and that in any
event money damages would be an inadequate remedy for any such breach.
Accordingly, subject to Section 8 of this Agreement, the parties agree
that if one of the parties breaches, or proposes to breach, any portion of
this Agreement, the other party shall be entitled, in addition to all
other remedies that it may have, to an injunction or other appropriate
equitable relief to restrain any such breach without showing or proving
any actual damage to such party.
8. Arbitration of Disputes. Any controversy or claim arising out of
or relating to this Agreement or the breach thereof or otherwise arising out of
the Executive's hiring, employment or the termination of that employment
(including, without limitation, any claims of unlawful employment discrimination
whether based on age or otherwise) shall, to the fullest extent permitted by
law, be settled by arbitration in any forum and form agreed upon by the parties
or, in the absence of such an agreement, under the auspices of the American
Arbitration Association ("AAA") in Boston, Massachusetts in accordance with the
Employment Dispute Resolution Rules of the AAA, including, but not limited to,
the rules and procedures applicable to the selection of arbitrators. In the
event that any person or entity other than the Executive or the Employer may be
a party with regard to any such controversy or claim, such controversy or claim
shall be submitted to arbitration subject to such other person or entity's
agreement. Judgment upon the award rendered by the arbitrator may be entered in
any court having jurisdiction thereof. This Section 8 shall be specifically
enforceable. Notwithstanding the foregoing, this Section 8 shall not preclude
either party from pursuing a court action for the sole purpose of obtaining a
temporary restraining order or a preliminary injunction in circumstances in
which such relief is appropriate; provided that any other relief shall be
pursued through an arbitration proceeding pursuant to this Section 8.
9. Consent to Jurisdiction. To the extent that any court action is
permitted consistent with or to enforce Section 8 of this Agreement, the parties
hereby consent to the jurisdiction of the Superior Court of the Commonwealth of
Massachusetts and the United States District Court for the District of
Massachusetts. Accordingly, with respect to any such court action, the Executive
(a) submits to the personal jurisdiction of such courts; (b) consents to service
of process; and (c) waives any other requirement (whether imposed by statute,
rule of court, or otherwise) with respect to personal jurisdiction or service of
process.
10. Integration. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter hereof and supersedes
all prior agreements between the parties with respect to any related subject
matter.
11. Assignment; Successors and Assigns, etc. Neither the Employer nor the
Executive may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; provided that the Employer may assign its rights under this Agreement
without the consent of the Executive in the event that the Employer shall effect
a reorganization, consolidate with or merge into any other corporation,
partnership, organization or other entity, or transfer all or substantially all
of its properties or assets to any other corporation, partnership, organization
or other entity. This Agreement shall inure to the benefit of and be binding
upon the Employer and the Executive, their respective successors, executors,
administrators, heirs and permitted assigns.
12. Enforceability. If any portion or provision of this Agreement
(including, without limitation, any portion or provision of any section of
this Agreement) shall to any extent be declared illegal or unenforceable by a
court of competent jurisdiction, such portion or provision may be reformed by
a court of competent jurisdiction to the extent necessary to render it legal
or enforceable, and in any event shall be enforced to the extent permissible
under the law, and the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.
13. Waiver. No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party. The failure of any party to
require the performance of any term or obligation of this Agreement, or the
waiver by any party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.
14. Notices. Any notices, requests, demands and other communications
provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by a nationally recognized overnight courier service or by
registered or certified mail, postage prepaid, return receipt requested, to the
Executive at the last address the Executive has filed in writing with the
Employer or, in the case of the Employer, at its main offices, attention of the
General Counsel, and shall be effective on the date of delivery in person or by
courier or three (3) days after the date mailed.
15. Amendment. This Agreement may be amended or modified only by a
written instrument signed by the Executive and by a duly authorized
representative of the Employer.
16. Governing Law. This is a Massachusetts contract and shall be construed
under and be governed in all respects by the laws of the Commonwealth of
Massachusetts, without giving effect to the conflict of laws principles of such
Commonwealth. With respect to any disputes concerning federal law, such disputes
shall be determined in accordance with the law as it would be interpreted and
applied by the United States Court of Appeals for the First Circuit.
17. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to
be an original; but such counterparts shall together constitute one and the
same document.
18. Public Announcements. Neither the Executive nor the Employer shall
make any public announcement, including, without limitation, press releases or
media interviews, with respect to the terms of this Agreement or, if applicable,
the termination of the Executive's employment with the Employer, except as is
mutually approved by the parties (such approval not to be unreasonably withheld)
and except as may be required by applicable law.
IN WITNESS WHEREOF, this Agreement has been executed as a sealed
instrument by the Employer, by its duly authorized officer, and by the
Executive, as of the Agreement Date.
EXECUTIVE THE STRIDE RITE CORPORATION
/s/ Xxxxx X. Xxxxxxxxxxx By: /s/ Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxxxxxx Xxxxx X. Xxxxxxxx
an individual Chairman and CEO
EXHIBIT A
RELOCATION
The Executive shall be entitled to the following with respect to the relocation
of his residence from San Francisco, California to the greater Boston,
Massachusetts area, which relocation must be completed before (a date to be
determined):
1. House Hunting Trips. Up to four (4) pre-relocation trips will be provided
for the Executive and his spouse to locate temporary and/or permanent
housing. The arrangements for such house hunting trips shall be
coordinated through the Employer. Travel, meals, housing costs and a
rental car are reimbursed for the Executive and his spouse to visit the
new location for up to five (5) days per trip.
2. Temporary Living. The Executive shall be reimbursed for temporary living
arrangements until the purchase of the Massachusetts Home, as defined
below, but in no event after May 15, 2000. Such reimbursable living
arrangements shall be the Employer's rate at the DoubleTree Guest Suites
Hotel in Waltham, Massachusetts or a comparably priced hotel or apartment.
3. Moving Expenses. The Employer shall move the Executive's household
goods, personal effects, automobiles and small boats. The Employer
shall coordinate the move with its corporate moving consultant. The
moving consultant will select, arrange and contract transportation
carriers for all shipments. The cost will be paid directly by the
Employer. The carrier shall handle normal packing, transportation and
unpacking of goods. If storage is required, it will be provided for up
to thirty (30) days, including handling and re-delivery to the
Executive's new residence in Massachusetts. All shipments of household
goods are insured by the applicable transportation company. The
Employer will reimburse the Executive for any losses in excess of the
carrier's liability, at replacement cost or the cost of repair,
whichever is less. Money, securities, personal papers, jewelry, furs,
watches and precious stones are excluded from insurance coverage. The
Executive should hand carry or make other arrangements for the
relocation of such items. An appraisal and/or list (with description
and value) for all property will be required by the transportation
company in advance of the move.
4. Selling San Francisco Home. The Executive shall be reimbursed for the
reasonable and customary brokers commission (not to exceed One Hundred
Thousand Dollars ($100,000), attorney's fees related to the title,
transfer tax, document and recording fees incurred in the sale of the
Executive's residence located at 0000 Xxxxxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx
(the "California Home").
5. Purchase of Massachusetts Home. With respect to the Executive's
purchase of permanent residence in the greater Boston, Massachusetts
area (the "Massachusetts Home"). The Executive shall be reimbursed for the
following reasonable and customary fees and expenses: (i) attorney's fees
related to the title; (ii) transfer and documentary taxes; (iii) recording
fees for the deed and mortgage; (iv) home inspection fees; and (v) up to
two percent (2%) of the first mortgage amount to cover origination fees
and points (not to exceed Thirty Thousand Dollars ($30,000).
6. Bridge Loan. The Employer shall, at the Executive's request, provide a
loan in the amount of One Million Dollars ($1,000,000) which will be
secured by the equity value of the California Home (the "Bridge
Loan"). The Employer reserves the right to have an independent real
estate broker appraise the California Home. The Bridge Loan shall: (i)
carry interest at a rate of one percentage point lower than the closing
prime commercial lending rate as reported by Chase Manhattan Bank N.A.
on the business day prior to the date of the Bridge Loan; (ii) be due
and payable the earlier of: (x) the sale of the California Home; (y)
termination of the Executive's employment with the Employer; or (z) 18
months from the date of the Bridge Loan; and (iii) be secured by a
second mortgage on the California Home. Interest shall accrue on the
Bridge Loan and shall be payable at the time the principal balance is
due in accordance with 6 (ii), above. The Bridge Loan is subject to
documentation reasonably acceptable to the Employer.
7. Taxes. In order to assist the Executive in alleviating the tax burden
caused by the reimbursement of certain expenses arising from the
relocation of the Executive by the Employer, the Employer shall pay to
the Executive an amount sufficient to reimburse the Executive for
additional Federal and State income taxes, including those applicable
taxes on such reimbursement, incurred on that portion of the
Executive's relocation expenses as provided in Sections 1, 2, 3, 4, 5
of this Exhibit A, which are not deductible under current Internal
Revenue Service rules, regulations and interpretations. A record of
all reimbursed relocation expenses shall be provided to the Executive
by the Employer's Accounting Department at the end of the tax year.
The tax allowance paid to the Executive shall be reported by the
Employer as extra income and appropriate tax withheld.
