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Exhibit 10.2
SENIOR EXECUTIVE EMPLOYMENT AGREEMENT
AGREEMENT made as of the ____ day of ________ 2008 between
Foot Locker, Inc. (the "Company"), a New York corporation with its
principal office located at 112 West 34 th Street, New
York, New York, and ____________ ("Executive").
W I T N E
S S E T H :
WHEREAS, the Company believes that the establishment and
maintenance of a sound and vital management of the Company is
essential to the protection and enhancement of the interests of the
Company and its shareholders;
WHEREAS, the Company wishes to provide for the continued
employment of the Executive with the Control Group, and the
Executive is willing to commit himself to continue to serve the
Company, on the terms and conditions herein provided;
and
WHEREAS, this Agreement supersedes any employment
agreement, severance plan, policy and/or practice of the Company in
effect on the date hereof for the Executive.
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, the parties hereto hereby agree as
follows:
1. Definitions . The following terms shall have the
meanings set forth in this section as follows:
(a) "Affiliate" shall mean the Company and any
entity affiliated with the Company within the meaning of Code
Section 414(b) with respect to a controlled group of corporations,
Code Section 414(c) with respect to trades or businesses under
common control with the Company, Code Section 414(m) with respect
to affiliated service groups and any other entity required to be
aggregated with the Company under Section 414(o) of the Code. No
entity shall be treated as an Affiliate for any period during which
it is not part of the controlled group, under common control or
otherwise required to be aggregated under Code Section
414.
(b) "Beneficiary" shall mean the individual
designated by the Executive, on a form acceptable by the Committee,
to receive benefits payable under this Agreement in the event of
the Executive's death. If no Beneficiary is designated, the
Executive's Beneficiary shall be his spouse, or if the Executive is
not survived by a spouse, the Executive's estate.
(c) "Board" shall mean the Board of Directors of
the Company.
(d) "Cause" shall mean (with regard to the
Executive's Termination of Employment with the Control Group): (i)
the refusal or willful failure by the Executive to substantially
perform his duties, (ii) with regard to the Control Group or any of
their assets or businesses, the Executive's dishonesty, willful
misconduct, misappropriation, breach of fiduciary duty or fraud,
(iii) the willful breach by the Executive of any material provision
of this Agreement, which breach is not cured within ten (10)
business days from the date of the Company's notice of the
occurrence of such breach to the Executive, or (iv) the Executive's
conviction of a felony (other than a traffic violation) or any
other crime involving, in the sole discretion of the Committee,
moral turpitude.
(e) "Change in Control" shall have the meaning
set forth in Appendix A attached hereto.
(f) "Code" shall mean the Internal Revenue Code
of 1986, as amended and as hereafter amended from time to
time.
(g) "Committee" shall mean the Compensation and
Management Resources Committee of the Board or an administrative
committee appointed by the Compensation and Management Resources
Committee.
(h) "Competition" shall mean participating,
directly or indirectly, as an individual proprietor, stockholder,
officer, employee, director, joint venturer, investor, lender, or
in any capacity whatsoever (within the United States of America or
in any other country where any of the Executive's former employing
members of the Control Group does business) in (A) a business in
competition with the retail, catalog, or on-line sale of athletic
footwear, athletic apparel and sporting goods conducted by the
Control Group (the "Athletic Business"), or (B) a business that in
the prior fiscal year supplied product to the Control Group for the
Athletic Business having a value of $20 million or more at cost to
the Company or any of its subsidiaries or affiliates; provided,
however, that such participation shall not include (X) the mere
ownership of not more than 1 percent of the total outstanding stock
of a publicly held company; (Y) the performance of services for any
enterprise to the extent such services are not performed, directly
or indirectly, for a business in competition with the Athletic
Business or for a business which supplies product to the Control
Group for the Athletic Business; or (Z) any activity engaged in
with the prior written approval of the Chief Executive Officer of
the Company.
(i) "Control Group" shall mean the Company and
its Affiliates.
(j) "Good Reason" shall mean (with respect to an
Executive's Termination of Employment with the Control
Group):
(i) Prior to a Change in Control, (A) a
reduction in the Executive's rate of base salary as payable from
time to time, other than a reduction that occurs in connection
with, and in the same percentage as, an across-the-board reduction
over any three-year period in the base salaries of all executives
of the Company of a similar level and where the reduction is less
than 20 percent of the Executive's base salary measured from the
beginning of such three-year period; or (B) a material and adverse
change in the nature and status of the Executive's authority or
responsibilities, except temporarily as a result of the Executive's
disability, illness or other absence.
(ii) On or after a Change in Control, (A) any
reduction in the Executive’s rate of base salary as payable
from time to time; (B) a failure of the Company to continue in
effect the benefits applicable to, or the Company's reduction of
the benefits applicable to, the Executive under any benefit plan or
arrangement (including without limitation, any pension, life
insurance, health or disability plan) in which the Executive
participates as of the date of the Change in Control without
implementation of a substitute plan(s) providing materially similar
benefits in the aggregate to those discontinued or reduced, except
for a discontinuance of, or reduction under, any such plan or
arrangement that is legally required, and provided that in either
such event the Company provides similar benefits (or the economic
effect thereof) to the Executive in any manner determined by the
Company; or (C) any material demotion of the Executive or any
material reduction in the Executive's authority or responsibility,
except temporarily as a result of the Executive's disability,
illness or other absence.
(iii) At any time, (A) a reduction in the
Executive's annual bonus classification level other than in
connection with a redesign of the applicable bonus plan that
affects all employees at the Executive's bonus level; (B) the
failure of any successor to the Company to assume in writing the
obligations hereunder; or (C) the Company’s failure to renew
this Agreement.
(k) "Non-Competition Period" shall mean (i) the
period the Executive is employed by the Control Group and (ii) at
any time prior to a Change in Control, the two (2) year period
commencing on the Termination Date.
(l) "Retirement" shall mean separation from
service with the Control Group in accordance with Section 409A on
or after the date that the Participant’s age added together
with his or her Years of Service equals or exceeds the sum of
sixty-five (65).
(m) "Salary" shall mean an Executive's base cash
compensation rate for services paid to the Executive by the Company
or an Affiliate at the time of his Termination of Employment from
the Control Group. Salary shall not include commissions, bonuses,
overtime pay, incentive compensation, benefits paid under any
qualified plan, any group medical, dental or other welfare benefit
plan, noncash
compensation or any other
additional compensation but shall include amounts reduced pursuant
to an Executive's salary reduction agreement under Sections 125,
132(f) or 401(k) of the Code (if any) or a nonqualified elective
deferred compensation arrangement to the extent that in each such
case the reduction is to base salary.
(n) "Section 409A" shall mean Section 409A of
the Code including the regulations issued thereunder by the
Department of the Treasury.
(o) "Severance Benefit" shall mean (i) in the
case of the Executive's Termination of Employment with the Control
Group that does not occur within the 24 month period following a
Change in Control and such termination is a Termination of
Employment by the Company without Cause or by the Executive for
Good Reason, 3.0 times the Executive’s weekly Salary
multiplied by the Executive's Years of Service; provided, however,
that the Severance Benefit shall be no less than 52 weeks' Salary;
or (ii) in the case of the Executive's Termination of Employment
with the Control Group that occurs within the 24 month period
following a Change in Control and such termination is a Termination
of Employment by the Company without Cause or by the Executive for
Good Reason, 3.0 times the Executive’s weekly Salary
multiplied by the Executive's Years of Service; provided, however,
that the Severance Benefit shall be no less than 3 times his annual
Salary.
(p) "Severance Period" shall mean (i) in the
case of the Executive's Termination of Employment that does not
occur within the 24 month period following a Change in Control and
such termination is a Termination of Employment by the Company
without Cause or by the Executive for Good Reason, two weeks'
multiplied by the Executive's Years of Service, with a minimum of
52 weeks; or (ii) in the case of an Executive's Termination of
Employment within the 24 month period following a Change in Control
and such termination is a Termination of Employment by the Company
without Cause or by the Executive for Good Reason, two weeks
multiplied by the Executive's Years of Service, with a minimum of
104 weeks.
(q) "Substantially All of the Assets of the
Company" shall mean at least 66 percent of the total gross fair
market value of the assets of the Company immediately prior to the
acquisition by a non-related third party, determined without regard
to any liabilities associated with such assets.
(r) "Termination Date" shall mean in the case of
the Executive's death, the date of death, or in all other cases,
the date specified in the Notice of Termination of Employment;
provided, however, that if the Executive's Termination of
Employment is due to disability as provided in Section 7(b), the
date specified in the Notice of Termination of Employment shall be
at least thirty (30) days from the date the Notice of Termination
of Employment is given to the Executive.
(s) "Termination of Employment" shall mean
separation from service with the Control Group in accordance with
Section 409A for any reason, including, but not limited to
retirement, death, disability, resignation or dismissal with or
without
Cause; provided, however, that
if an Employer is no longer a member of the Control Group and the
Participant is transferred in connection with the sale of the
assets of an Employer and the successor assumes the obligations
hereunder in accordance with Section 13 hereof, a Termination of
Employment shall not occur until termination of employment with the
new control group.
(t) "Year of Service" shall mean each 12
consecutive month period commencing on the Executive's date of hire
by the Company or an Affiliate and each anniversary thereof in
which the Executive is paid by the Company or an Affiliate for the
performance of full-time services as an Executive. For purposes of
this section, full-time services shall mean that the Executive is
employed for at least 30 hours per week. A Year of Service shall
include any period during which the Executive is not working due to
disability, leave of absence or layoff so long as he is being paid
by the Company or an Affiliate (other than through any employee
benefit plan). A Year of Service also shall include service in any
branch of the armed forces of the United States by any person who
is an Executive on the date such service commenced, but only to the
extent required by applicable law.
2. Term . The initial term of this Agreement shall
commence on __________ , 200_ and shall end on __________ , unless
further extended or sooner terminated as hereinafter provided. The
term shall be automatically renewed for additional one-year periods
unless the Company notifies the Executive three months prior to the
end of the term that the term shall not be renewed. In no event,
however, shall the term of the Executive's employment extend beyond
the date of the Executive's actual retirement under a retirement
plan of the Company.
3. Position and Duties . The Executive shall serve
as ____________ and shall have such responsibilities, duties and
authority as he may have as of the effective date of this Agreement
(or any comparable position to which he may be assigned after the
effective date of this Agreement) and as may from time to time be
assigned to the Executive by the Chief Executive Officer of the
Company that are consistent with such responsibilities, duties and
authority. The Executive shall devote substantially all of his
working time and efforts to the business and affairs of the Company
and its Affiliates.
4. Place of Performance . In connection with the
Executive's employment by the Company, the Executive shall be based
in the New York metropolitan area, except for required travel on
Company business.
5. Compensation and Related Matters
(a) Salary . During the period of the
Executive's employment hereunder, the Company or an Affiliate shall
pay to the Executive a salary at a rate not less than the rate in
effect as of the effective date of this Agreement or such higher
rate as may from time to time be determined by the Company, such
salary to be paid in accordance with the Company's normal payroll
practices.
(b) Expenses . During the term of the
Executive's employment hereunder, subject to Section 20 hereof, the
Executive shall be entitled to receive prompt reimbursement for all
reasonable and customary expenses incurred by the Executive in
performing services hereunder, including all expenses of travel and
living expenses while away from home on business or at the request
of and in the service of the Company or an Affiliate, provided that
such expenses are incurred and accounted for in accordance with the
policies and procedures established by the Company.
(c) Other Benefits . The Company shall
maintain in full force and effect, and the Executive shall be
entitled to continue to participate in, all of the employee benefit
plans and arrangements in effect on the date hereof in which the
Executive participates or plans or arrangements providing the
Executive with at least equivalent benefits thereunder (including
without limitation each retirement plan, supplemental and excess
retirement plans, annual and long-term incentive compensation
plans, stock option and purchase plans, group life insurance and
accident plan, medical and dental insurance plans, and disability
plan), and the Company shall not make any changes in such plans or
arrangements that would adversely affect the Executive's rights or
benefits thereunder; provided, however, that such a change may be
made, including termination of such plans or arrangements, to the
extent permitted by the respective plan or arrangement, if it
occurs pursuant to a program applicable to all comparably situated
executives of the Company and does not result in a proportionately
greater reduction in the rights of or benefits to the Executive as
compared with any other comparably situated executive of the
Company. The Executive shall be entitled to participate in or
receive benefits under any employee benefit plan or arrangement
made available by the Company in the future to its comparably
situated executives and key management employees, subject to and on
a basis consistent with the terms, conditions and overall
administration of such plans and arrangements. Nothing paid to the
Executive under any plan or arrangement presently in effect or made
available in the future shall be deemed to be in lieu of the salary
payable to the Executive pursuant to Section 5(a). Any payments or
benefits payable to the Executive hereunder in respect of any
calendar year during which the Executive is employed by the Company
for less than the entire year shall, unless otherwise provided in
the applicable plan or arrangement, be pro rated in accordance with
the number of days in such calendar year during which he is so
employed.
(d) Vacations . The Executive shall be
entitled to no less than the number of vacation days in each
calendar year that is determined in accordance with the Company's
vacation policy as in effect on the date hereof. The Executive
shall also be entitled to all paid holidays and personal days given
by the Company to its executives.
6. Offices . Subject to Sections 3 and 4, the
Executive agrees to serve without additional compensation, if
elected or appointed thereto, as a director of the Company and any
of its Affiliates and in one or more executive offices of any of
the Company's Affiliates.
7. Termination of Employment . The Executive's
employment hereunder may be terminated without any breach of this
Agreement only upon the following circumstances:
(a) Death . The Executive's employment
hereunder shall automatically terminate upon his death.
(b) Disability . If, as a result of the
Executive's incapacity due to physical or mental illness as
determined by the Company in its sole discretion, the Executive
shall have been absent from his duties hereunder on a full-time
basis for a period of six consecutive months, and within 30 days
after written Notice of Termination of Employment is given (which
may occur before or after the end of such six month period) shall
not have returned to the performance of his duties hereunder on a
full-time basis, the Company may immediately terminate the
Executive's employment hereunder.
(c) Cause . The Company may terminate the
Executive's
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