EXHIBIT 10.71
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is dated as of April 1, 1998
and is entered into between X.X. Management Services, Inc., a Delaware
corporation (the "Corporation") and __________________ (the "Executive").
R E C I T A L S
---------------
WHEREAS, the Corporation desires to employ the Executive, and the Executive
desires to be so employed by the Corporation, on the terms and subject to the
conditions hereinafter set forth.
A G R E E M E N T
-----------------
NOW, THEREFORE, the parties hereto have agreed, and do hereby mutually
agree, as follows:
1. Employment. Subject to the other terms and conditions set forth
----------
herein, the Corporation hereby employs the Executive, and the Executive agrees
to be employed by the Corporation, as _______________, for a term commencing on
April 1, 1998 and continuing until the earlier of March 31, 2001 or the date
such employment shall have been terminated as provided in Section 3 hereof.
Beginning April 1, 2001, this Agreement shall renew automatically for an
additional one year term until the Corporation gives Executive written notice at
least 14 calendar days prior to the end of a term, of its intention to terminate
this Agreement; provided, however, that this Agreement may terminate earlier
than the end of a term as provided in Section 3 hereof. In her capacity as
__________________, the Executive shall faithfully perform to the best of her
ability and in a satisfactory manner all services and acts necessary or
advisable as may be assigned to her by the Chief Executive Officer. Throughout
the term hereof the Executive shall, except as may from time to time be
otherwise agreed in writing by the Corporation, devote her full-time working
hours to her duties hereunder.
2. Compensation.
------------
(a) For all services to be rendered by Executive hereunder, and for
all rights granted the Corporation hereunder, the Executive shall be paid by the
Corporation a base salary at the annual rate of $______ for each 12-month period
of the term hereof, prorated for any portion thereof, payable in substantially
equal bimonthly installments, less required withholdings. This base salary
shall be reviewed for any adjustments annually by the Board of Directors of the
Corporation (the "Corporation Board") or, at the Corporation Board's option, a
compensation committee thereof (the "Committee"), provided that any adjustments
shall be in the sole discretion of the Corporation Board or the Committee.
(b) The Executive shall be entitled to paid vacations, personal and
sick days consistent with the policies of the Corporation for management
employees. The Executive shall receive such other compensation as shall be
approved by the Corporation Board and shall participate in all fringe benefits
(including, without limitation, group medical, life, disability and accidental
death and dismemberment insurance), bonus and benefit plans which shall be
generally available from time to time to management employees of the
Corporation.
(c) The Executive shall be reimbursed in accordance with the policies
of the Corporation as adopted by the Corporation Board from time to time for her
reasonable travel, entertainment, business,
meeting and similar expenditures, incurred for the benefit of the Corporation
and subject to approval of the Chief Executive Officer of the Corporation or the
Corporation Board. As an additional condition to the reimbursement of such
expenses by the Corporation to the Executive, the Executive shall provide the
Corporation with copies of all available invoices and receipts, and otherwise
account to the Corporation in sufficient detail and with adequate documentation
to allow the Corporation to confirm the business nature of the expenses and
claim an income tax deduction for such paid items, if such items are deductible.
(d) Brylane, L.P., a Delaware limited partnership and the parent
entity of the Corporation (the "Partnership"), agrees that the Partnership shall
provide the Executive with a benefits package substantially similar (which is
not materially less favorable to the Executive in the aggregate) to those
coverages and benefits provided or made available to the Executive (and her
dependents) immediately prior to the consummation of the transactions
contemplated by those certain Stock Purchase Agreements each dated as of
February 19, 1998, among FS Equity Partners II, L.P., a California limited
partnership, FS Equity Partners III, L.P., a Delaware limited partnership, FS
Equity Partners International, L.P., a Delaware limited partnership and Pinault
Printemps-Redoute, S.A., a company organized under the laws of France ("PPR")
and between M&P Distributing Company, a Nevada corporation and PPR. In
addition, the Partnership shall provide a bonus or incentive compensation plan
which provides the Executive with the opportunity to earn the right to be paid
additional compensation as set forth on Exhibit A hereto. This subsection (d)
---------
shall not be implemented so as to limit any rights or benefits to which the
Executive or her dependents may be entitled under any employee benefit plan
maintained by or contributed to by the Corporation.
3. Termination.
-----------
(a) The employment of the Executive hereunder may be terminated by the
Corporation on at least 30 days' prior written notice if the Corporation Board
determines that the Executive has become permanently disabled (as hereinafter
defined). Such written notice shall provide reasonable detail regarding the
basis for such determination. The Executive shall be deemed to be "permanently
disabled," as used in this subsection, if the Executive has been substantially
unable to discharge her duties and obligations hereunder by reason of illness,
accident or disability for a period of 180 days in any twelve-month period.
(b) The employment of the Executive hereunder may be terminated
forthwith by the Corporation for cause (as hereinafter defined) upon written
notice from the Corporation Board to the Executive. Such written notice shall
provide reasonable detail regarding the basis for such determination. The
Corporation shall have "cause" to terminate the Executive, as used in this
subsection, only if the Corporation Board shall determine that the Executive
has, (i) refused or failed within a reasonable period of time to carry out any
reasonable and material direction from the Chief Executive Officer of the
Corporation, the Corporation Board or the Board of Representatives of the
Partnership (the "Partnership Board") (other than a failure resulting from the
Executive's incapacity due to physical or mental illness), (ii) been guilty of a
material and willful breach of the terms of this Agreement, (iii) demonstrated
gross negligence or willful misconduct in the execution of her assigned duties,
(iv) been convicted of a felony or other serious crime involving moral
turpitude, (v) engaged in fraud, embezzlement or other illegal conduct to the
detriment of the Corporation, (vi) intentionally imparted confidential
information relating to the Corporation to a third party, other than in the
course of carrying out the Executive's duties, or (vii) materially and willfully
breached any of her obligations pursuant to the Management Stock Subscription
Agreement dated as of February 26, 1997 between Brylane Inc., a Delaware
corporation and the parent entity of the Partnership, and the Executive if such
breach has not been cured 5 days after receipt of written notice to the
Executive.
(c) The employment of the Executive hereunder shall be automatically
terminated on the date of the Executive's death.
2
(d) In addition to the circumstances set forth in subsections (a), (b)
and (c) of this Section 3, the Corporation may terminate the Executive's
employment for any reason or no reason and with or without cause upon 30 days'
prior written notice to the Executive.
(e) The Executive may terminate her employment hereunder forthwith at
any time for good reason (as hereinafter defined) upon written notice to the
Corporation. For purposes of this subsection, "good reason" shall mean the
occurrence of any of the following: (i) a reduction by the Corporation in the
Executive's base salary herein provided or as the same may be increased from
time to time; (ii) any relocation by the Corporation of Executive's principal
place of employment of more than 50 miles from the place where Executive's
principal residence was located on the date Executive gives notice of such
termination; (iii) a material and willful breach by the Corporation of any of
its obligations to the Executive hereunder, including, without limitation, the
Corporation's failure to obtain the written assumption agreement described in
Section 10(a) if such agreement is not obtained within 5 days after written
notice that a written assumption agreement required under Section 10(a) has not
been obtained; or (iv) the involuntary termination (other than "for cause") of
Xx. Xxxxx X. Xxxxxxx as an executive officer of the Partnership at any time.
(f) In addition to the circumstances described in subsection (e) of
this Section 3, the Executive may terminate her employment hereunder for any
reason or no reason upon 30 days' prior written notice to the Corporation.
(g) If the Executive's employment is terminated pursuant to this
Section 3, the Executive shall be entitled to, and the Corporation's obligation
hereunder shall be limited to, (i) the payment of the compensation accrued under
Section 2 hereof to the effective date of such termination and (for any
termination other than pursuant to Section 3(b)) a pro rata portion of any
bonuses or incentive compensation payable with respect to any period commencing
prior to the termination date, and (ii) in the case of termination under
subsections (a), (c), (d) or (e) of this Section 3, the additional compensation
provided in subsection (h) of this Section 3.
(h) (i) if the Executive's employment is terminated by the
Corporation pursuant to subsection (a) of this Section 3 the Executive will get
the benefit of any Corporation disability plans; provided, however, that for a
period of 12 consecutive months after the effective date of the termination the
Corporation will pay the Executive the difference (if any) between the level of
annualized salary provided for in Section 2 hereof, less required withholdings,
and the amounts provided under such disability plans; or
(ii) if the Executive's employment is automatically
terminated pursuant to subsection (c) of this Section 3, the Corporation shall
continue to pay to the Executive (or, if applicable, to her executor,
administrator or heirs) the Executive's salary in equal monthly installments at
the level of annualized salary provided for in Section 2 hereof being paid to
the Executive at the time of such termination, less required withholdings, for a
period of 12 consecutive months after the effective date of the termination; and
(iii) if the Executive's employment is terminated by the
Corporation pursuant to subsection (d) of this Section 3 or if the Executive
terminates her employment pursuant to subsection (e) of this Section 3, the
Corporation shall continue to pay to the Executive the Executive's salary in
equal monthly installments at the level of annualized salary provided for in
Section 2 hereof being paid to the Executive at the time of such termination,
less required withholdings, for the greater of (A) one year after the effective
date of the termination, and (B) the period after the effective date of the
termination, through and including the last day of the then effective term of
this Agreement.
(i) The Executive shall not be required to mitigate the amount of any
payment provided for in this Section 3 by seeking other employment or otherwise;
but the amount of any payment provided for in this Section 3, other than amounts
set forth in subsection (g)(i) of this Section 3, shall be reduced by any
3
compensation earned by the Executive as the result of employment by another
employer after the effective date of termination of the Executive's employment
by the Corporation.
(j) Nothing in this Agreement shall be deemed a release or waiver of
right to any medical or other employee benefits available to the Executive on or
after the effective date of termination of the executive's employment by the
Corporation under federal, state or local law which provides for the
continuation of any medical or other employee benefits after such termination
date.
4. Noncompetition. If the Executive is terminated by the Corporation for
--------------
cause in accordance with Subsection 3(b) hereof, or if the Executive terminates
her employment other than for "good reason" in accordance with Subsection 3(e)
hereof, then except as provided in the next sentence, for a period of 12 months
after such termination, the Executive will not carry on (as an employee, agent,
consultant, independent contractor, stockholder, partner, owner or otherwise)
any trade or business competing with the then trade or business of the
Corporation (or its affiliates) in any state in which the Corporation (or its
affiliates) is carrying on such trade or business as of the effective date of
such termination. The foregoing provisions of this Section 4 notwithstanding,
the Executive may own not more than 5% of the issued and outstanding shares of
any class of securities of an issuer whose securities are listed on a national
securities exchange or registered pursuant to Section 12(g) of the Securities
Exchange Act of 1934, as amended.
5. Trade Secrets. During the term of this Agreement and at all times
-------------
thereafter, the Executive shall hold in secrecy all trade secrets and
confidential information relating to the Corporation's (and its affiliates')
business and affairs that may come to her knowledge or have come to her
knowledge while employed by the Corporation or its predecessors (excluding
information that is or becomes publicly known or available for use through no
fault of the Executive), including but not limited to (i) matters of a business
nature, such as information about costs, profits, markets, sales, lists of
customers and other information of a similar nature, (ii) plans or strategies
for development of the business of the Corporation and (iii) matters of a
technical nature. Except as required in the performance of her duties to the
Corporation under this Agreement, the Executive shall not use for her own
benefit or disclose to any person, directly or indirectly, such matters unless
such use or disclosure has been specifically authorized in writing by the
Corporation in advance.
6. Executive's Representation. The Executive shall be, and she
--------------------------
represents that she is, free to enter into this Agreement and not under any
contractual restraint which would prohibit her satisfactorily performing her
duties to the Corporation hereunder.
7. Governing Law. This Agreement shall be governed by and construed and
-------------
enforced in accordance with the internal substantive laws (and not the laws of
conflicts of laws) of the State of New York.
8. Costs. If either party brings any legal action against the other to
-----
enforce its rights under this Agreement, the prevailing party in such dispute
shall be entitled to recover from the other party all reasonable fees, costs and
expenses actually incurred in enforcing its rights under this Agreement
including, without limitation, the reasonable fees and expenses of attorneys,
accountants and expert witnesses, which shall include, without limitation, all
fees, costs and expenses of appeals and of enforcement.
9. Entire Agreement. This Agreement constitutes the whole agreement of
----------------
the parties hereto in reference to any employment of the Executive by the
Corporation and in reference to the subject matter hereof, and all prior
agreements, promises, representations and understandings relative thereto are
merged herein.
10. Assignability.
-------------
(a) In the event that the Corporation shall merge or consolidate with
any other corporation, partnership or business entity or all or substantially
all the Corporation's business or assets shall be
4
transferred in any manner to any other corporation, partnership or business
entity, including (without limitation) any entity that succeeds to the business
of the Corporation pursuant to Article X of that certain Partnership Agreement
dated August 30, 1993, as amended, such successor shall thereupon succeed to,
and be subject to, all rights, interests, duties and obligations of, and shall
thereafter be deemed for all purposes hereof to be, the Corporation hereunder
and the Corporation shall obtain a written assumption agreement from such
successor prior to completion of any such merger, consolidation or sale of
assets.
(b) This Agreement is personal in nature and neither of the parties
hereto shall, without the written consent of the other party hereto, assign or
transfer this Agreement or any rights or obligations hereunder, except by
operation of law or pursuant to the terms of Section 10(a).
(c) Nothing expressed or implied herein is intended or shall be
construed to confer upon or give to any person, other than the parties hereto,
any right, remedy or claim under or by reason of this Agreement or of any term,
covenant or condition hereof.
11. Remedies. Any material breach, violation or evasion by the Executive
--------
of the terms of this Agreement, including specifically, but not limited to,
Sections 4 and 5, will result in immediate and irreparable injury and harm to
the Corporation, and will cause damage to the Corporation in amounts difficult
to ascertain. Accordingly, the Corporation shall be entitled to, and Executive
hereby consents to the entry of, the remedies or injunction and specific
performance, or either of such remedies, as well as all other remedies to which
the Corporation may be entitled, at law, in equity or otherwise.
12. Amendments; Waivers. This Agreement may be amended, modified,
-------------------
superseded, canceled, renewed or extended and the terms or covenants hereof may
be waived only by a written instrument executed by the parties hereto or, in the
case of a waiver, by the party waiving compliance. The failure of any party at
any time or times to require performance of any provision hereof shall in no
manner affect the right at a later time to enforce the same. No waiver by any
party of the breach of any term or provision contained in this Agreement,
whether by conduct or otherwise, in any one or more instances, shall be deemed
to be, or construed as, a further or continuing waiver of any such breach, or a
waiver of the breach of any other term or covenant contained in this Agreement.
13. Notice. All notices, requests and other communications hereunder
------
shall be in writing and, if given by facsimile, telegram, telecopy or telex,
shall be deemed to have been validly served, given or delivered when sent, if
given by personal delivery, shall be deemed to have been validly served, given
or delivered upon actual delivery and, if mailed or delivered by overnight
courier, shall be deemed to have been validly served, given or delivered when
deposited in the United States mail, as registered or certified mail, with
proper postage prepaid, or when deposited with the courier service, and
addressed to the party or parties to be notified, at the following addresses (or
such other address(es) as a party may designate for itself by like notice):
If to the Corporation:
X.X. Management Services, Inc.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Senior Vice President - Human Resources
5
If to the Executive:
_____________________________
_____________________________
_____________________________
14. Severability. Any provision of this Agreement that is prohibited or
------------
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
only to the extent of such prohibition or unenforceability without invalidating
or affecting the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent that a
restrictive covenant contained herein may, at any time, be more restrictive than
permitted under the laws of any jurisdiction where this Agreement may be subject
to review and interpretation, the terms of such restrictive covenant shall be
those allowed by law and the covenant shall be deemed to have been revised
accordingly. Each and every term of this Agreement shall be enforced to the
fullest extent permitted by law.
6
15. Counterparts. This Agreement may be executed in two counterparts,
------------
each of which shall be deemed an original and both of which together shall be
deemed one Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
The "Corporation": X.X. MANAGEMENT SERVICES, INC.
By: _____________________________________
Name:
Title:
The "Executive":
___________________________________________
Signature
The undersigned hereby guarantees the performance of
this Agreement by X.X. Management Services, Inc., a
Delaware corporation
BRYLANE, L.P.
_____________________________________
Name:
Its:
7
EXHIBIT A
Brylane has a semi-annual performance bonus program based upon goals
relating to Brylane's operating profit. Such goals will be established at the
beginning of each six-month season based upon a review by the Partnership Board
of management's operating budget for that season. Each participant in such
program may receive a bonus for each semi-annual bonus period equal to a certain
percentage of his or her annual salary. The actual bonus amount will be based
upon the extent to which the operating profit goals for that season are met or
exceeded. Operating profit shall exclude any charge resulting from the
formation of the Partnership, such as the write-up of inventory to fair market
value on August 30, 1993 and the amortization of the cost of intangibles
resulting from the purchase accounting relating to the acquisition. Except as
otherwise determined by the Partnership Board, or the Committee, in its sole
discretion, operating profit for any given six-month season will also exclude
any and all operating profit that is attributable to transactions entered into
by Brylane or its affiliates during that six-month season. The Executive's
individual participant percentage under such plan will be ___%, subject to any
adjustments by the Partnership Board, or the Committee, as it may see fit in its
sole discretion.
8
