EXHIBIT 10.3
AMENDMENT NO. 1 TO
VANS, INC. EMPLOYMENT AGREEMENT
THIS AMENDMENT NO. 1 TO VANS, INC. EMPLOYMENT AGREEMENT (the
"Amendment") is hereby entered into by and between Vans, Inc., a Delaware
corporation ("Vans"), and Xxxxxxx X. Xxxxxx ("Employee") as of June 1, 2002,
with reference to the following facts:
A. Vans and Employee are parties to an Employment Agreement dated
as of July 1, 1999 (the "Employment Agreement").
B. On May 29, 2002, the Compensation Committee of the Board of
Directors of Vans: (i) approved a proposal to amend certain provisions of the
employment agreements of senior executives of the Company in recognition of
their lengthy and meritorious service to the Company (the "Senior Executives"),
and (ii) authorized and directed the officers of the Company to execute and
deliver such amendments.
C. Employee is a Senior Executive.
NOW, THEREFORE, the parties hereto agree as follows:
1. Amendments to the Employment Agreement. Sections 11.4 and 11.5
of the Employment Agreement are hereby deleted in their entirety and the
following new Sections are substituted therefor:
"11.4 Severance Compensation. In the event (i) Employee
terminates this Agreement for Good Reason in accordance with Paragraph 11.3
hereof; or (ii) Employee is terminated without Cause, the Company shall be
obligated to pay severance compensation to Employee in an amount equal to his
salary compensation (at the rate payable at the time of such termination) for a
period of six months. In the event Employee is terminated without Cause, or
terminates this Agreement for Good Reason, within three (3) years of a "Change
in Management or Control" (as such term is defined in Paragraph 11.5 hereof),
the Company shall be obligated to pay severance compensation to Employee in an
amount equal to 2.99 times the sum of (a) Employee's then current salary
compensation, plus (b) the highest amount of bonus earned by Employee in any
fiscal year during the three fiscal years prior to the Change in Management or
Control, or in any fiscal year in the three-year period immediately prior to the
date of this Agreement, and such severance compensation shall be "grossed up"
for all federal and state taxes payable thereon. Employee shall have the option,
in his sole discretion, to receive such severance compensation in one lump sum.
In addition to the foregoing severance compensation, the Company shall also pay
Employee (i) all compensation for services rendered hereunder and not previously
paid; (ii) accrued vacation pay; and (iii) any appropriate business expenses
incurred by Employee in connection with his duties hereunder and approved
pursuant to Section 4 hereof, all through the date of termination.
"11.5 Definition of Change in Management or Control. The
term `Change in Management or Control' means the occurrence, in a single
transaction or in a series of related transactions, of (i) a merger,
consolidation or similar transaction involving (directly or indirectly) the
Company and, immediately after the consummation of such merger, consolidation or
similar transaction, the stockholders of the Company immediately prior thereto
do not own, directly or indirectly, outstanding voting securities representing
more than fifty percent (50%) of the combined outstanding voting power of the
surviving entity in such merger, consolidation or similar transaction or more
than fifty percent (50%) of the combined outstanding voting power of the parent
of the surviving entity in such merger, consolidation or similar transaction;
(ii) a sale, lease, license or other disposition of all or substantially all of
the consolidated assets of the Company and its subsidiaries, other than a sale,
lease, license or other disposition of all or substantially all of the
consolidated assets of the Company and its subsidiaries to an entity, of more
than fifty percent (50%) of the combined voting power of the voting securities
of which are owned by stockholders of the Company in substantially the same
proportions as their ownership of the Company immediately prior to such sale,
lease, license or other disposition; or (iii) the acquisition by any Person
(other than any employee benefit plan, or related trust, sponsored or maintained
by the Company) as Beneficial Owner (as `Person' and `Beneficial Owner' are
defined in the Securities Exchange Act of 1934, as amended, or the rules and
regulations thereunder), directly or indirectly, of securities of the Company
representing 20 percent (20%) or more of the total voting power represented by
the Company's then outstanding voting securities."
2. No Further Amendments. Except as specifically provided in this
Amendment, the Employment Agreement shall remain unmodified and in full force
and effect.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of June 1, 2002.
VANS: EMPLOYEE:
Vans, Inc., a Delaware corporation
By: /s/ Xxxx X. Xxxxxxxxxx /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
Title: President and Chief Executive Officer
