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EXHIBIT 10(r)(i)
April 24, 1997
Mr. M. Xxxxxxx Xxxxxxx
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Dear Xx. Xxxxxxx:
You and Woolworth Corporation (the "Company") are parties to a Senior
Executive Severance Agreement dated as of April 24, 1997 (the "Agreement"). In
that regard, you and the Company have agreed that in the event of the
termination of your employment with the Company in a manner that would cause you
to qualify for a Severance Benefit under the provisions of the Agreement, the
Company would make certain additional payments to you, as set forth herein.
1. Capitalized terms used herein that are defined in the Agreement shall
have the meanings provided for in the Agreement, unless otherwise defined
herein. As used herein, the term "Total Severance Payment" shall be an amount
equal to the sum of: (i) your annual base salary at the time of the termination
of your employment by the Company, (ii) the amount of the target bonus expected
to be earned by you under the Company's Annual Incentive Compensation Plan for
the fiscal year of the Company in which your termination of employment occurs,
and (iii) $200,000.
2. In the event your employment with the Company is terminated under
circumstances that would entitle you to the payment of a Severance Benefit under
the provisions of Section 3 of the Agreement, you will be entitled to additional
payments, as follows:
a. If the payment made to you under the provisions of Section 3(a) of
the Agreement (the "Initial Payment") does not equal 50 percent of the Total
Severance Payment, the Company shall pay you an additional amount so that the
Initial Payment and such additional payment shall equal 50 percent of the Total
Severance Payment. Such additional payment shall be made to you at the same time
and in the same manner, and with interest payable thereon under the same
circumstances and in the same manner, as the Initial Payment.
b. If a payment is made to you under the provisions of Section 3(b) of
the Agreement (the "Subsequent Payment") and the Subsequent Payment does not
equal 50 percent of the Total Severance Payment, the Company shall pay you an
additional amount so that the Subsequent Payment and such additional payment
shall equal 50 percent of the Total Severance Payment. Such additional payment
shall be made to you at the same time and in the same manner, and with interest
payable thereon under the same circumstances and in the same manner, as the
Subsequent Payment.
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3. In the event that at the time of your termination of employment the
term of the Agreement has not been renewed pursuant to the provisions of Section
2 thereof, (i) your eligibility for the payment described in paragraph 2(a)
hereof shall be determined by whether you would be entitled to a payment under
the provisions of Section 3(a) of the Agreement if the Agreement were then in
effect; (ii) your eligibility for the payment described in paragraph 2(b) hereof
shall be determined by whether you would be entitled to a payment under the
provisions of Section 3(b) of the Agreement if the Agreement were then in
effect; and (iii) the amounts paid to you under the provisions of paragraphs
2(a) and 2(b) hereof shall be calculated as if the Initial Payment and the
Subsequent Payment, in each instance, were in the amount of $1.00.
4. Notwithstanding the provisions of Sections 1(i) and 3(c) of the
Agreement, you shall not be considered to have engaged in Competition during the
one year period following termination of your employment with the Control Group
solely as a result of your providing investment banking advice or services to a
business in competition with any business conducted by any member of the Control
Group; provided, however, that such investment banking services or advice do not
involve (i) representing or assisting any person or group of persons for the
purpose of seeking control of or influencing the management, business, or
policies of, the Company or (ii) any transaction to which the Company, or any
subsidiary or affiliate of the Company, is a party and where you are personally
providing investment banking advice or services to the counter-party with
respect to its transaction with the Company. Notwithstanding the provisions of
the preceding sentence, nothing herein shall prohibit a firm with which you are
affiliated from providing such advice or services provided that you personally
adhere to the provisions of this paragraph.
5. Clause (iii) of Section 1(k) of the Agreement apply only to
your bonus classification level under the Annual Incentive Compensation Plan.
6. Any dispute or controversy arising under or in connection with this
letter agreement shall be settled exclusively by arbitration, conducted in the
same manner, and as part of the same proceeding, if any, as provided for under
the provisions of Section 16 of the Agreement.
Please sign and return the copy of this letter enclosed for that purpose
to indicate your agreement with the foregoing.
Yours truly,
WOOLWORTH CORPORATION
By: /s/ Xxxx X. Xxxxxxx
Accepted and Agreed: -------------------
Xxxx X. Xxxxxxx
/s/ M. Xxxxxxx Xxxxxxx
M. Xxxxxxx Xxxxxxx
Date:
