EMPLOYMENT SEVERANCE AGREEMENT
AND MUTUAL RELEASE
Food Lion, a division of Delhaize America, Inc. (the
"Company") and A. Xxxxxx Xxxxxx, Xx. (the "Executive") hereby
agree as follows:
1. Purpose of Severance Agreement and Release
The purpose of this Employment Severance Agreement and
Mutual Release of Liability ("Severance Agreement and Release")
is to set forth the terms of the Executive's severance from
employment with the Company, to resolve fully any and all
obligations arising out of his employment and severance from
employment, and to protect the Company's legitimate interest in
maintaining the confidentiality of information pertaining to its
business plans and operations known to, or possessed by, the
Executive.
2. Termination of Employment
A. The Executive's employment with the Company shall terminate
by his retirement effective January 1, 2000 (the "termination
date").
B. The Executive's participation in the Company's Profit
Sharing Retirement Plan and Profit Sharing Restoration Plan shall
terminate effective January 1, 2000. The Executive shall be
entitled to receive all vested benefits owing under the Company's
profit sharing and employee benefit plans in which the Executive
is participating as of the date of his retirement to the extent
specifically provided for by such plans and/or to the extent
otherwise required by law.
C. The Executive's 1999 Profit Sharing contribution will be
determined by the Board of Directors on the same basis as amounts
are determined for vice presidents of the Company who were
employed through January 1, 2000.
D. As provided in the stock option agreements governing such
stock options, all vested stock options of the Company held by
the Executive as of the retirement date shall remain exercisable
for eighty-nine (89) days following the retirement date.
3. Consideration
A. In consideration of the Executive's release of all claims
that may exist against the Company in connection with his
employment as more specifically set forth below in Paragraph 4,
and in consideration of the Executive's compliance with the
obligations set forth below in Paragraphs 7 and 8, and provided
the Executive complies with all other terms and conditions of
this Severance Agreement and Release, the Company agrees that:
1. The Company will pay the Executive an amount equal to his
weekly salary of $5,074.63 from January 1, 2000 through June 4,
2000. These payments shall be subject to all legally required
state and federal tax deductions and withholdings.
2. The Company shall continue until March 4, 2000 the
participation of the Executive and his eligible dependents in the
Group Benefit Plan and Executive Medical Plan. Following such
period, the Executive shall be entitled to continuation of health
care under COBRA.
3. The Executive will receive a 1999 incentive bonus in an
amount to be determined by the Board of Directors on the same
basis as amounts are determined for vice presidents of the
Company who were employed through January 1, 2000.
4. The Executive will receive annual bonus and wellness
payments for 1999.
The Company may withhold from any compensation or benefits
payable under this Agreement all federal, state or other taxes as
may be required pursuant to any law or regulation or ruling.
Except as specifically provided herein or as otherwise may
be required by law, the Executive shall not be entitled to
receive any other payment benefits or severance amount from the
Company following the retirement date.
B. The Executive acknowledges that the rights and payments
provided in Paragraph 3(A):
1. represent valuable consideration over and above what he is
otherwise entitled to in connection with the termination of his
employment and that his release of claims in Paragraph 4 and his
agreement to comply with the obligations of Paragraphs 7 and 8 of
this Severance agreement and Release are in return for this
consideration;
2. shall be in lieu of any and all claims for severance pay,
additional wages, bonus, salary, accrued vacation and sick leave
pay or other compensation, or benefits, or claim of damages he
may have as of his termination date other than vested benefits
described in Paragraph 2(C) and such rights as Executive may have
to obtain continued insurance coverage under COBRA; and
3. arise solely out of the terms of this Severance Agreement
and Release and are not part of any Company severance pay plan.
C. The Company acknowledges that its promises and releases
contained in this Severance Agreement and Release are for good
and valuable consideration.
4. Waiver and Release
As a material inducement for Executive and Company to enter
this Severance Agreement and Release, each of them hereby
irrevocably and unconditionally releases and forever discharges
the other as detailed below.
A. The Executive releases and forever discharges all claims he
may have against the Company, its subsidiaries, affiliates,
parents, predecessors, and all officers, directors,
representatives, agents or employees in any manner arising out of
or attributable to his employment with the Company. This release
includes all claims that may have existed on his termination date
relating to the Executive's employment with and termination from
the Company, including all claims and rights under his employment
contract whether brought by Executive or by a third party on his
behalf, including, but not limited to:
1. discrimination on the basis of age, including claims under
Title VII of the Civil Rights Act of 1964, the Age Discrimination
in Employment Act as amended, the Americans with Disabilities
Act, or other applicable federal statutes and other applicable
state and local statutes;
2. any claim under any statute, law or regulation, based on any
fact, matter, event or cause, whether known or unknown, arising
out of or relating to the employment relationship between the
Executive and the Company or the Executive's separation
therefrom.
B. The Executive agrees not to institute any legal or
administrative proceedings against the Company or those persons
described in Paragraph 4(A) as to any matter based upon, arising
out of or related to his employment, compensation during his
employment, or termination of his employment with the Company.
C. The Company, on behalf of its officers, directors,
employees, agents, counsel, successors, assigns and related
entities hereby releases and forever discharges the Executive,
his heirs, assigns and representatives from any and all claims,
liabilities, damages, costs, and other obligations in any manner
arising out of or attributable to his employment with the
Company, and will indemnify and hold harmless the Executive to
the fullest extent permitted under North Carolina law, including,
without limitation, the provisions of Part 5 (or any successor
provision) of the North Carolina Business Corporation Act, from
and against all losses, claims, damages, liabilities, costs and
expenses (including, without limitation, attorneys' fees), which
may, at any time, be suffered by the Executive as a result of the
fact that the Executive was an officer of the Company, or was
serving at the request of the Company as an officer, employee or
agent of an affiliate of the Company. The expenses incurred by
the Executive in any proceeding shall be paid promptly by the
Company in advance of the final disposition of any proceeding at
the written request of the Executive to the fullest extent
permitted by North Carolina law.
D. This Severance Agreement and Release does not waive or
release rights or claims for occurrences after the effective date
of this Severance Agreement and Release. This Severance
Agreement and Release does not preclude the Executive or Company
from filing a lawsuit against the other for purposes of enforcing
rights conferred to each other under this Severance Agreement and
Release.
5. Company Property
The Executive represents and agrees that he has not and will
not retain, distribute, or cause to be distributed, any Company
property, including but not limited to, originals and copies of
Company documents, files, memoranda, notes, computer-readable
information (maintained in disc or any other form) and video or
tape recordings of any kind other than personal materials
relating solely to the Executive.
6. Loans
The Company and the Executive acknowledges that, as of the
date of this Agreement, there is an outstanding balance in the
amount of $177,699.63 (the "Loan") owed by the Executive to the
Company pursuant to the Company's Low Interest Loan Plan. The
Executive agrees to repay the full outstanding balance on or
before March 31, 2003.
7.
Confidentiality
A. The Executive agrees that the existence and terms of the
Severance Agreement and Release are and shall remain
confidential, and further agrees not to disclose the existence or
terms of the Severance Agreement and Release to any third party,
except that:
1. the Executive may disclose to his family that he retired
from the Company and the amount of consideration he received in
connection with his separation and disclose the terms and
conditions of this Severance Agreement and Release to his
attorneys, tax consultants, state and federal authorities or as
may be required by law;
2. it is understood that the Company will disclose the terms
and conditions of this Severance Agreement and Release to the
extent necessary to carry out the terms of this Agreement to its
managers, officers and board of directors, insurers, consultants,
accountants, attorneys, state and federal tax authorities, or as
may be required by law, including but not limited to disclosure
as may be required in the Company's proxy statement and as
required by SEC public reporting requirements;
3. disclosure only that the Executive retired voluntarily and
that the parties parted amicably will not violate this Paragraph
7(A).
B. The Executive acknowledges that as a result of his
employment by the Company, he has acquired valuable proprietary
information of a sensitive and confidential nature pertaining to
the Company's business operations, trade secrets, its strategies
and plans, which, if disclosed to individuals or entities not
employed by the Company, would materially harm the Company and/or
provide an unfair advantage to its competitors. The Executive
covenants and agrees:
1. that he shall not, directly or indirectly, orally or in
writing, at any time in the future disclose any information of
the Company as defined in Paragraph 7(B)(2), whether such
information is a trade secret, confidential or proprietary, to
any person, partnership, corporation or other business entity,
except with the written permission of the Company.
2. That for purposes of Paragraph 7(B)(1), the term "any
information of the Company" means all information which relates
to matters such as, but not necessarily limited to, trade
secrets, research and development activities, books and records,
expansion strategies, operational plans or strategies, real
estate strategies, or other processes or strategies, distribution
channels, pricing information and private processes, real estate
site selection, projected store openings or closings, employee
communications, training or development strategies, and advice
given by any legal counsel or other consultants retained by the
Company whether or not protected by the attorney-client or work
product privileges.
3. Paragraph 7(B)(1) or (2) shall not be violated by the
disclosure of information pursuant to a court order or as
otherwise required by law, on condition that notice of the
requirement for such disclosure is given to the Company before
the Executive's making any disclosure and the Executive
cooperates in resisting such disclosure upon reasonable request
by the Company at the Company's expense.
C. The Executive acknowledges that, by virtue of the
responsibilities assigned to him throughout his employment, in
the event he should make any public statements relating to the
Company after his termination, such statements could be
attributed to the Company or be viewed as authoritative, and
based on information to which the Executive had access while
employed by the Company. Accordingly, the Executive agrees that
he will make no public comment in any way relating to the
Company, without the express written permission of the Company.
8. Agreement Not to Compete
The Executive acknowledges that the Company has legitimate
business interests in assuring that the skills and knowledge to
the nature and character of the Company's business obtained by
the Executive during his employment with the Company are not
converted to the use of entities in competition with the Company
or who are engaged in activities aimed at damaging the Company's
public image or are otherwise antithetical to the Company's
lawful interests. In recognition of these legitimate interests,
the Executive agrees that:
A. From the date of execution of this Severance Agreement and
Release until December 31, 2000, the Executive will not compete
with the Company, directly or indirectly, by acting either
individually or as an advisor, representative, agent, employee,
partner, shareholder, investor, consultant, or in any other
similar capacity, on behalf of any other membership clubs selling
groceries or other retail formats selling food products (but
which shall not include manufacturers of food products not
engaged in the retail grocery business, and shall not include
stores of 10,000 square feet or less), in the geographical area
defined in Paragraph 8(B). The Executive's ownership of not more
than one percent (1%) of the stock of any publicly-held grocery
chain shall not be deemed a violation of this Paragraph.
B. The Executive agrees not to act in the capacities set forth
in Paragraph 8(A) for entities operating in North Carolina, South
Carolina, Virginia, Tennessee, Georgia, Florida, Maryland,
Delaware, Kentucky, West Virginia, and Pennsylvania.
C. From the date of execution of this Severance Agreement and
Release to December 31, 2000, the Executive will not recruit,
solicit or otherwise contact employees of the Company on behalf
of any other entity, either directly or as an agent, in order to
solicit or induce any employee of the Company to accept
employment with another entity.
D. In the event the Company ceases to operate in any of the
states included above, then the restriction with respect to said
state shall cease upon the date the Company ceases operations in
said state.
9. Enforcement
The Executive agrees that he has received good and valuable
consideration for his agreement both to adhere to the
confidentiality provisions of Paragraph 7 and to the non-compete
provisions of Paragraph 8 and that in the event the Company
obtains evidence that Executive has violated Paragraphs 7 and 8
in any respect, the Company shall have the option to:
A. cease payment of any additional amounts provided for in
Paragraph 3(A) of this Severance Agreement and Release; or
B. obtain temporary and permanent injunctive relief in a
Superior Court of the State of North Carolina to remedy such
violation. The Executive consents to jurisdiction of that court
or provide such injunctive relief. The Executive agrees that
failure to comply with his obligations under Paragraphs 7(B),
7(C), or 8(A), 8(B) or 8(C) of this Severance Agreement and
Release shall constitute irreparable harm to the Company, without
regard to any demonstrable economic harm to the Company from
Executive's breach, and that the appropriate remedy for partial
or total breach of those provisions shall be an interim and
permanent order directing specific performance with each and
every term of this Severance Agreement and Release, with damages
resulting from the breach, and all costs and attorneys fees
incurred in obtaining enforcement of this Severance Agreement and
Release to be awarded to the Company. The Executive further
agrees that in such proceeding, he shall make no assertion of
mitigation in defense to the Company's prayer for injunctive
relief.
10. Acknowledgement of Voluntary Nature of Severance Agreement
and Release
By signing this Severance Agreement and Release, the
Executive and the Company acknowledge:
A. That each has entered into this Severance Agreement and
Release voluntarily and fully understands all of its terms;
B. That the Executive has been advised and has had the
opportunity to consult with an attorney prior to signing this
Severance Agreement and Release;
C. That the Executive has been given the opportunity to
consider this Severance Agreement and Release for a period of at
least twenty-one (21) days, and, after consulting with his
attorney, has voluntarily and freely executed this Agreement
prior to the expiration of the twenty-one day period, and has
voluntarily and freely waived the right to consider the Severance
Agreement and Release for the full twenty-one day period; and
D. That the Executive and Company are not relying on any
statement or promise other than as contained in this Severance
Agreement and Release.
11. Assistance
Upon reasonable notice, the Executive agrees to willingly
give his assistance, including his attendance, where appropriate,
to the Company's defense or prosecution of any existing or future
claims or litigation. The Company will reimburse the Executive
for all reasonable travel expenses incurred by the Executive in
complying with this section. In the event the Executive is no
longer entitled to the payments set forth in Section 3 of this
Agreement, then the Executive shall be compensated at the rate of
$100 per day for such assistance.
12. Revocation Period
The Executive understands that he has a seven (7) day period
after signing this Severance Agreement and Release in which to
revoke or rescind his agreement and release of claims by
informing the Company's Vice President of Legal Affairs in
writing of his decision to revoke. To be effective, the
rescission must either be delivered to the Company's Vice
President of Legal Affairs by hand within the seven day period,
or be sent by certified mail, return receipt requested, properly
addressed to the Company's Vice President of Legal Affairs in
accordance with Paragraph 16 of this Severance Agreement and
Release, and be postmarked within the seven day period.
13. Binding Agreement
A. This Severance Agreement and Release will become effective
and enforceable upon the expiration of the seven day revocation
period referred to in Section 12 (the "effective date"). The
Executive and the Company understand that following the seven day
revocation period, this Severance Agreement and Release will be
final and binding.
B. This Severance Agreement and Release constitutes the entire
agreement of the parities with respect to the subject matter set
forth herein and there are no promises, understandings or
representations, oral or written, other than those set forth
herein.
C. The Executive and the Company agree that, after the
Severance Agreement and Release becomes final and binding, they
will not pursue any claim which has been waived under the
Severance Agreement and Release and will not challenge the
enforceability of the Severance Agreement and Release by filing
or instigating any lawsuit or administrative complaint or
investigation arising out of the Executive's employment or
termination.
14. Law of North Carolina
This Severance Agreement and Release, having been prepared,
executed and delivered in the State of North Carolina, and shall
be governed by the laws of the State of North Carolina.
15. Severability
Each provision of this Severance Agreement and Release is
intended to be severable. If any provision, sentence, phrase or
word of this Severance Agreement and Release or the application
thereof to any person or circumstance shall be held invalid or
unenforceable, the remainder of this Severance Agreement and
Release, or the application of such provision, sentence, phrase
or word to persons or circumstances, other than those as to which
it is held invalid, shall not be affected thereby.
16. Notices
Any notices required or permitted to be given by the parties
shall be given in writing by certified mail, return receipt
requested, or by prepaid telegram, delivered to:
Xxxxxx X. Nail
Vice President of Legal Affairs
0000 Xxxxxxxxx Xxxxx
Xxxx Xxxxxx Xxx 0000
Xxxxxxxxx, XX 00000-0000
and
A. Xxxxxx Xxxxxx, Xx.
0000 Xxxxxxx Xxxxx Xxxx
Xxxxxxxxx, XX 00000
17. Death of Executive
In the event of the death of the Executive, any payment due
under this Severance Agreement and Release will be made to the
beneficiary designated by the Executive in writing, and, if no
beneficiary is designated, to his Estate.
FOOD LION, a division of DELHAIZE
AMERICA, INC.
Dated:1/1/00 By: /s/Xxxxxxx Xxxxxxx
XXXXXXX XXXXXXX
VICE PRESIDENT OF HUMAN
RESOURCES
EXECUTIVE
Dated:1/1/00 By:/s/Xxxxxx Xxxxxx, Xx.
A. XXXXXX XXXXXX, XX.
