FIRST AMENDMENT TO
EXECUTIVE EMPLOYMENT AGREEMENT
THIS FIRST AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENT (the "Amendment"),
dated and effective as of October 1, 1998, is made and entered into by and
between CATHERINES, INC., a Delaware corporation having its principal offices at
0000 Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxx 00000 (the "Company"), and XXXXXXX X.
XXXX, an individual residing at 000 Xxxxxxxxxx Xxxx, Xxxxxxx, Xxxxxxxxx 00000
the "Employee").
W I T N E S S E T H:
WHEREAS, the Company and Employee are parties to an Executive Employment
Agreement dated as of May 23, 1991 (the "Employment Agreement"), pursuant to
which the Company has engaged Employee to perform executive and managerial
services for the Company; and
WHEREAS, the parties desire to amend the Employment Agreement upon the
terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements hereinafter contained, and other good and valuable consideration,
the receipt and sufficiency of all of which are hereby acknowledged, the parties
agree as follows: 1. Amendment to Employment Agreement. The Employment Agreement
is hereby amended by adding the following new Paragraph 11(d) thereto:
"(d) (1) If Employee's employment is terminated within two (2) years after
the occurrence of a "change of control" of the Company or its parent
corporation, Catherines Stores Corporation (the "Parent"), by either (i)
the Company or its successor other than for cause or (ii) the Employee
during the period beginning with the second (2nd) month and continuing
through the twenty-fourth (24th) month after any change in control, if he
determines that by reason of material adverse changes in, inter alia, his
authority, compensation, duties, managerial responsibilities or
geographical place of work, he is unable to perform the duties and
responsibilities of the position he held immediately prior to the change in
control, then the Employee shall be entitled to receive a lump sum payment,
payable within thirty (30) days after the date of such termination, equal
to (X) the sum of (A) 1/12th of his annual base salary in effect
immediately before such termination plus (B) 1/12th of 100% of his target
bonus opportunity for the fiscal year of the Company in which such
termination occurs, multiplied by (Y) the greater of (a) the number of
calendar months remaining in the term of Employee's employment hereunder
and (b) 36. In the event of such termination, the Employee shall also be
entitled to a continuation during the number of months following the date
of termination equal to the number of months determined pursuant to the
immediately preceding clause (Y) of (i) the supplemental retirement
benefits provided in accordance with Paragraph 6 hereof, and (ii) health
and insurance benefits upon the same terms and conditions as in effect at
the time ofsuch termination subject to the proviso at the end of Paragraph
11(b) above.
(2) If any excise tax is imposed pursuant to the Internal Revenue Code of
1986, as amended (the "Code") (including, without limitation, Section 4999
of the Code), or of any successor legislation (an "Excise Tax") upon any
portion of a benefit payment made to the Employee in accordance with this
Paragraph 11, the Company shall pay the initial Excise Tax and any
additional Excise Tax and federal and state income tax which arises as a
result of the Company's payment of the initial Excise Tax on behalf of the
Employee.
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(3) As used herein, the term "change in control" means (i) a person
(including, without limitation, a corporation, trust, partnership, joint
venture, limited liability company, individual or other entity) or group
of affiliated (directly or indirectly) persons becoming the owner(s)
(whether directly, indirectly, beneficially or of record) of more than
thirty-five percent (35%) of the outstanding shares of common stock of the
Company or the Parent at any time after October 1, 1998, (ii) the merger
or consolidation into, or sale of substantially all of the assets of the
Company or the Parent to, another corporation in which the Company or the
Parent, as the case may be, is not the surviving and operating
corporation, or where the stockholders of the Company or the Parent prior
to such transaction(s) do not own at least sixty-five percent (65%) of the
outstanding voting securities of the surviving corporation after such
transaction(s), or (iii) the persons who are directors of the Company or
the Parent as of October 1, 1998 cease to constitute a majority of the
Board of Directors of the Company or the Parent, as the case may be,
during any 24-month period after a transaction described in (i) or (ii) of
this Paragraph 11(d)."
2. Ratification of Employment Agreement. Except as specifically modified
hereby, all other terms, conditions and restrictions set forth in the Employment
Agreement are hereby ratified and confirmed by the Company and Employee and
shall remain in full force and effect. To the extent any of the terms of this
Amendment conflict with the terms of the Employment Agreement, the terms of this
Amendment shall govern.
3. Miscellaneous. Capitalized terms used but not otherwise defined herein
shall have the respective meanings given to such terms in the Employment
Agreement. This Amendment may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument. This Amendment shall become effective as of the
date first written above, upon the execution by each of the parties of at least
one counterpart hereof, and it shall not be necessary that any single
counterpart bear the signatures of both parties. The execution and delivery of
this Amendment by delivery of a facsimile copy bearing the facsimile signature
of a party hereto shall constitute a valid and binding execution and delivery of
this Amendment by such party, and such facsimile copies shall constitute
enforceable original documents. This Amendment shall be governed by and
construed and enforced exclusively in accordance with the laws of the State of
Tennessee, without regard to principles of conflicts of laws.
IN WITNESS WHEREOF, the parties have executed this Amendment as of the date
first above written.
CATHERINES, INC.
By:
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Xxxxx X. Xxxxxx,
Executive Vice President
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Xxxxxxx X. Xxxx
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