A G R E E M E N T
This Agreement made and entered into as of this 25th day of March, 1997 by
and between ONE PRICE CLOTHING STORES, INC., a Delaware corporation, hereinafter
("Corporation") and XXXXX X. XXXXXX, XX., hereinafter ("Xxxxxx"). R E C I T A L
S
WHEREAS, Xxxxxx was one of the founders of the Corporation and since its
inception has held the positions of Chairman, CEO and/or President within the
Corporation and has rendered services of great value to the Corporation;
WHEREAS, in recognition of the valuable services rendered by Xxxxxx to
the Corporation as one of the persons responsible for its success, and to
adequately compensate Xxxxxx for his past services, the Corporation desires to
establish a compensation plan for Xxxxxx commencing upon his retirement or upon
his death should that occur first.
NOW, THEREFORE, in consideration of the mutual promises and covenants
herein contained and in view of the past services rendered by Xxxxxx to the
Corporation, the receipt and legal sufficiency of which is hereby acknowledged,
the parties hereto agree as follows:
1. CONSIDERATION: The consideration for the compensation to be paid by
the Corporation to Xxxxxx hereunder is solely in recognition of his diligent
work as a founder of the Corporation and as the person most responsible for the
success of the Corporation. The payment of this compensation by the Corporation
to Xxxxxx, as provided herein, is not in any way whatsoever dependent or
contingent upon Xxxxxx rendering any future services to the Corporation as an
employee, consultant, or member of its Board of Directors.
2. COMPENSATION: The Corporation shall pay to Xxxxxx as compensation for
his past services the sum of One Million Six Hundred Fifty thousand and no/100
($1,650,000.00) dollars, payable in one hundred twenty (120) consecutive monthly
installments of Thirteen Thousand Seven Hundred Fifty and no/100 dollars
($13,750.00) each less all legally required deductions. Payments shall commence
on the first management
payroll date after his retirement or upon his death, should that occur first,
and shall continue on the first management payroll date in each month until the
full sum of One Million Six Hundred Fifty Thousand and no/100 ($1,650,000.00)
dollars has been paid. The parties agree and acknowledge that the right of
Xxxxxx to receive such compensation is based upon an unfunded contractual
obligation of the Corporation.
Provided, however, that in the event of any action or transaction
involving the merger or consolidation of the Corporation into or with any other
corporation, the sale or other transfer of all or any substantial part of the
assets of the Corporation or the liquidation or dissolution of the Corporation,
the entire sum of any remaining unpaid portion of the compensation payable by
the Corporation to Xxxxxx hereunder as at the effective date of any such
proposed action shall be deemed immediately due and payable according to the
terms of Paragraph 3 hereof, without deduction, reduction or set-off for
then-present value calculation or for any other reason, other than legally
required deductions.
3. PAYMENT OF COMPENSATION: So long as Xxxxxx is living, all payments of
compensation hereunder shall be paid by the Corporation directly to him and upon
his death such payments shall be made directly to his wife, if she is still
living, and upon the death of Xxxxxx' wife, to his estate; provided, however,
should Xxxxxx' wife predecease him, upon Xxxxxx' death, the remaining payments
shall be paid to the estate of Xxxxxx.
4. ADDITIONAL SERVICES BY XXXXXX: The compensation to be paid Xxxxxx by
the Corporation hereunder is not dependent upon Xxxxxx rendering any additional
or future services to the Corporation; however, this Agreement should not be
interpreted or construed so as to prevent Xxxxxx from rendering consultative
services to the Corporation upon a mutually agreed case-by-case basis for
additional compensation, nor shall this Agreement prevent Xxxxxx from serving on
the Board of Directors of the Corporation or any of its committees at the
customary and usual compensation paid someone holding such position and
performing such functions.
5. CONFIDENTIAL INFORMATION: Xxxxxx acknowledges that during his employment
he has had access to information and ideas of the Corporation, and the
expressions and physical embodiments thereof
(including, but not limited to, lists, reports, forms, materials, charts,
diagrams, manuals, computer codes and programs, correspondence and documents),
and that Corporation considers all the above to be confidential, proprietary
information and property of the Corporation. Xxxxxx will not reveal, furnish,
provide or otherwise make available such confidential, proprietary information
and property to any other person without the prior express written consent of
Corporation, and Xxxxxx will take all steps reasonably necessary or advisable to
protect such confidential, proprietary information and property from disclosure
to other persons. Upon retirement, Xxxxxx will not take with him any of the
aforesaid physical embodiments of said confidential, proprietary information and
property.
6. COMPETITION RESTRICTION: During the term of this Agreement, Xxxxxx shall
not become associated with, engage in or render services to any other business
in competition with the Corporation.
7. REMEDY: Each of the parties hereby acknowledge that in the event of
breach by Xxxxxx of his undertakings and promises set forth in Section 5. and 6.
above the actual damages sustained by the Corporation would be difficult to
accurately quantify or measure. Xxxxxx therefore agrees that each violation by
him of the promises, undertakings and restrictions of Section 5. and 6.
(evidenced in each instance by reasonably probative materials or documents),
shall result in the assessment against Xxxxxx of ten thousand dollars
($10,000.00) dollars in liquidated damages, and not as a penalty, payable to the
Corporation; provided, however, that the Corporation hereby acknowledges that
such liquidated damages shall constitute the Corporation's sole and exclusive
remedy for breach by Xxxxxx of such promises, undertakings or restrictions.
8. NO ASSIGNMENT: The right of Xxxxxx or any other person to the payment of
compensation or other benefits under this Agreement shall not be assigned,
transferred, pledged or encumbered except by Will or other testamentary
instrument or by the laws of descent and distribution.
9. BINDING EFFECT: This Agreement was authorized by the Board of Directors
of the Corporation at a meeting duly held on March 6, 1997. Upon execution by
both the Corporation and Xxxxxx, this Agreement shall be binding upon and enure
to the benefit of the Corporation, its successors and assigns and Xxxxxx, his
heirs, executors, administrators, and legal representatives.
10. GOVERNING LAW: This Agreement shall be construed in accordance with and
governed by the laws of the State of South Carolina.
11. COMPLIANCE WITH CODE: The parties hereto intend that this Agreement
comply with the provisions of the Internal Revenue Code and Regulations in
effect at the time of its execution. If, at a later date, the laws of the United
States or the State of South Carolina are construed in such a way as to make
this Agreement or any of its provisions null and void, it shall be given effect
in a manner that shall best carry out the purposes and intentions of the
parties.
12. SEVERABILITY: If the Internal Revenue Service shall at any time
interpret this Agreement to be ineffective with regard to deferral of Xxxxxx'
income, and that interpretation becomes final and unappealable, then, and in
such event, only the remaining unpaid portion of Xxxxxx' compensation which
would be treated as taxable income by the Service at the time of such final
interpretation shall immediately be paid over to Xxxxxx. The other remaining
unpaid portion of Xxxxxx' compensation at the time of such final interpretation
shall be distributed to Xxxxxx in accordance with paragraph 2. hereinabove.
13. ENTIRE AGREEMENT: This Agreement supersedes all other Agreements
previously made between the parties relating to a retirement plan for Xxxxxx.
There are no other understandings or agreements with respect to the subject
matter herein contained.
14. NOTICE: Any notice to be delivered under this Agreement shall be in
writing and delivered, personally or by certified mail, postage prepaid,
addressed to the Corporation or to Xxxxxx at their last known addresses.
15. HEADINGS: Headings in this Agreement are for convenience only and shall
not be used to interpret or construe its provisions.
16. COUNTERPARTS: This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Corporation has caused this Agreement to be
executed by the Chairman of the Compensation Committee of the Board of Directors
and Xxxxxx as of the date first written above.
WITNESSES: ONE PRICE CLOTHING STORES, INC.
/s/ Xxxx X. Xxxxxxxx BY:/s Xxxxx X. Xxxxxxxxx, Xx.
Xxxxx X. Xxxxxxxxx, Xx.
/s/ Xxxx X. Xxxxxxxxxxx Chairman, Compensation
Committee of the Board of Directors
/s/ Xxxxx X. X'Xxxxxx /s/ Xxxxx X. Xxxxxx, Xx.
Xxxxx X. Xxxxxx, Xx.
/s/ Xxxxxxx X. Xxxxx
