Exhibit 10.1
GEORGIA
SHONK-SIMMONS
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT AGREEMENT (this
“ Agreement ”) is dated as of December 20,
2006, by and between Coldwater Creek Inc., a Delaware corporation
(the “ Company ”), and Georgia Shonk-Simmons
(the “ Executive ”).
WHEREAS, the Company desires to
employ the Executive as its President and Chief Merchandising
Officer, and the Executive desires to accept such employment, on
the terms set forth below.
Accordingly, the parties hereto
agree as follows:
1. Term . The Company hereby
employs the Executive, and the Executive hereby accepts such
employment for an initial term commencing as of the date hereof and
ending December 20, 2009, unless sooner terminated in
accordance with the provisions of Section 4 or Section 5,
and which shall automatically renew for an additional one year term
unless six months advance notice is given of non-renewal (the
period during which the Executive is employed hereunder being
hereinafter referred to as the “ Term
”).
2. Duties . The Executive, in
her capacity as President and Chief Merchandising Officer, shall
faithfully perform for the Company the duties of said office and
shall perform such other duties of an executive, managerial or
administrative nature as shall be specified and designated from
time to time by the Chief Executive Officer or board of directors
or similar governing body of the Company (the “ Board
”) (including the performance of services for, and serving on
the Board of Directors of, any subsidiary or affiliate of the
Company without any additional compensation). The Executive will be
based at the Company’s headquarters, presently located in
Sandpoint, Idaho. The Executive shall devote substantially all of
the Executive’s business time and effort to the performance
of the Executive’s duties hereunder, provided that in no
event shall this sentence prohibit the Executive from performing
personal and charitable activities and any other activities
approved by the Chief Executive Officer or the Board, so long as
such activities do not materially and adversely interfere with the
Executive’s duties for the Company.
3. Compensation .
3.1 Salary . The Company
shall pay the Executive during the Term a base salary at the rate
of $600,000 per annum (the “ Annual Salary ”),
payable semi-monthly and subject to regular deductions and
withholdings as required by law. The Annual Salary may be increased
annually by an amount as may be approved by the Board or the
Compensation Committee of the Board of Directors (the “
Compensation Committee ”), and, upon such increase,
the increased amount shall thereafter be deemed to be the Annual
Salary for purposes of this Agreement.
3.2 Bonus . The Executive
will be entitled to such bonuses as may be authorized by the Board.
The Executive’s target bonus amount, when expressed as a
percentage of Annual Salary, will be no less than the target amount
that was applicable for fiscal year 2006, provided, however, that
Executive’s Annual Bonus, if any, may be below, at, or above
the target based upon the achievement of individual and objective
Company annual performance criteria established by the Compensation
Committee.
3.3 Equity-Based Awards . The
Executive may from time to time be awarded such restricted stock
units, stock options or other equity-based awards as the Board or
the Compensation Committee determines to be appropriate.
3.4 Benefits – In
General . The Executive shall be permitted during the Term to
participate in any group life, hospitalization or disability
insurance plans, health programs, pension and profit sharing plans,
supplemental executive retirement plan and similar benefits that
may be available to other senior executives of the Company
generally, on the same terms as may be applicable to such other
executives, in each case to the extent that the Executive is
eligible under the terms of such plans or programs.
3.5 Personal Days . During
the Term, the Executive shall be entitled to the number of personal
days per year as may be prescribed from time to time pursuant to
the Company’s human resources policies.
3.6 Expenses . The Company
shall pay or reimburse the Executive for all ordinary and
reasonable out-of-pocket expenses actually incurred (and, in the
case of reimbursement, paid) by the Executive during the Term in
the performance of the Executive’s services under this
Agreement, provided that the Executive submits such expenses in
accordance with the policies applicable to senior executives of the
Company generally.
4. Termination upon Death or
Disability . If the Executive dies during the Term, the
obligations of the Company to or with respect to the Executive
shall terminate in their entirety except as otherwise provided
under this Section 4. If the Executive becomes eligible for
disability benefits under the Company’s long-term disability
plans and arrangements (or, if none apply, would have been so
eligible under the most recent plan or arrangement), the Company
shall have the right, to the extent permitted by law, to terminate
the employment of the Executive upon notice in writing to the
Executive and such termination in and of itself shall not be, nor
shall it be deemed to be, a breach of this Agreement; provided,
that, the Company will have no right to terminate the
Executive’s employment if, in the opinion of a qualified
physician reasonably acceptable to the Company, it is reasonably
certain that the Executive will be able to resume the
Executive’s duties on a regular full-time basis within 90
days of the date the Executive receives notice of such
termination.
Upon death of the Executive or upon
termination of the Executive’s employment by virtue of
disability the Executive (or the Executive’s estate or
beneficiaries in the case of the death of the Executive) shall have
no right to receive any compensation or benefit under this
Agreement on and after the Effective Date of the Termination (as
defined below in this Section
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4) other than the Annual Salary earned and
accrued under this Agreement prior to the Effective Date of the
Termination, a pro-rata bonus for the year of termination based on
the target and portion of year completed, and other benefits,
including payment for accrued but unused vacation, earned and
accrued under this Agreement prior to the Effective Date of the
Termination (and reimbursement under this Agreement for expenses
incurred but not paid prior to the Effective Date of the
Termination). In the event of termination by virtue of disability,
in addition to the foregoing, the Executive will also be entitled
to monthly cash payments equal to one twelfth (1/12th) of the
Executive’s Annual Salary in effect on the day of termination
for a period of eighteen (18) months. This Agreement shall
otherwise terminate upon the Effective Date of the Termination and
there shall be no further rights with respect to the Executive
hereunder (except as provided in Section 7.13). For purposes
of this Section 4, the “ Effective Date of the
Termination ” shall mean the date of death or the date on
which a notice of termination by virtue of disability is given by
the Company or any later date set forth in such notice of
termination.
For the avoidance of doubt, the
Executive acknowledges and agrees that the payments set forth in
this Section 4 constitute liquidated damages for termination
of her employment during the Term upon her death or by virtue of
her disability.
5. Other Terminations of
Employment .
5.1 Termination for Cause;
Termination of Employment by the Executive Without Good Reason
.
(a) For purposes of this Agreement,
“ Cause ” shall mean:
(i) the Executive’s commission
of any felony;
(ii) the Executive’s
commission of an act of fraud, theft or dishonesty;
(iii) the continuing failure or
habitual neglect by the Executive to perform the Executive’s
duties hereunder;
(iv) any material violation of
Company policy, including without limitation, the Company’s
Corporate Standards of Conduct;
(v) any material violation by the
Executive of Section 6 below; or
(iv) the Executive’s material
breach of this Agreement.
Notwithstanding the foregoing, if
there exists (without regard to this sentence) an event or
condition that constitutes Cause under clause (iii), (iv),
(v) or (vi) above, the Executive shall have 30 days from
the date written notice is given by the Company of such event or
condition to cure such event or condition and, if the Executive
does so, such event or condition shall not constitute Cause
hereunder.
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(b) For purposes of this Agreement,
“ Good Reason ” shall mean, unless otherwise
consented to by the Executive:
(i) the material reduction of the
Executive’s authority, duties and responsibilities, or the
assignment to the Executive of duties materially and adversely
inconsistent with the Executive’s position or positions with
the Company and its subsidiaries;
(ii) a reduction in Annual Salary of
the Executive except in connection with a reduction in compensation
generally applicable to senior management employees of the
Company;
(iii) a requirement by the Company
that the Executive’s work location be moved more than 50
miles from the Company’s principal place of business in
Sandpoint, Idaho; or
(iv) the Company’s material
and willful breach of this Agreement.
Notwithstanding the foregoing, if
there exists (without regard to this sentence) an event or
condition that constitutes Good Reason, the Company shall have 30
days from the date on which the Executive gives the written notice
thereof to cure such event or condition and, if the Company does
so, such event or condition shall not constitute Good Reason
hereunder. Further, an event or condition shall cease to constitute
Good Reason one (1) year after the event or condition first
occurs. In addition, for a period of 30 days commencing on the
first anniversary of the Change in Control, a Change in Control
shall constitute Good Reason, and in the event Executive terminates
employment, it will be deemed to have occurred within 12 months of
a Change in Control for purposes of Section 5.2.
(c) The Company may terminate the
Executive’s employment for Cause and such termination in and
of itself shall not be, nor shall it be deemed to be, a breach of
this Agreement. If the Company terminates the Executive for Cause,
(i) the Executive shall have no right to receive any
compensation or benefit under this Agreement on and after the
Effective Date of the Termination (as defined below in this
Section 5.1(c)) other than Annual Salary and other benefits,
including payment for accrued but unused vacation (but excluding
any bonuses) earned and accrued under this Agreement prior to the
Effective Date of the Termination (and reimbursement under this
Agreement for expenses incurred but not paid prior to the Effective
Date of the Termination), (ii) the provisions of
Section 5.3 shall apply and (iii) this Agreement shall
otherwise terminate upon the Effective Date of the Termination and
the Executive shall have no further rights hereunder (except as
provided in Section 7.13). For purposes of this
Section 5.1(c), the “ Effective Date of the
Termination ” shall mean the date on which a notice of
termination is given by the Company or any later date set forth in
such notice of termination.
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(d) The Executive may terminate her
employment without Good Reason. If the Executive terminates the
Executive’s employment with the Company without Good Reason:
(i) the Executive shall have no right to receive any
compensation or benefit under this Agreement on and after the
Effective Date of the Termination (as defined below in this
Section 5.1(d)) other than Annual Salary and other benefits,
including payment for accrued but unused vacation (but excluding
any bonuses) earned and accrued under this Agreement prior to the
Effective Date of the Termination (and reimbursement under this
Agreement for expenses incurred but not paid prior to the Effective
Date of the Termination), (ii) the provisions of
Section 5.3 shall apply and (iii) this Agreement shall
otherwise terminate upon the Effective Date of the Termination and
the Executive shall have no further rights hereunder (except as
provided in Section 7.13). For purposes of this
Section 5.1(d), the “ Effective Date of the
Termination ” shall mean the date on which a notice of
termination is given by the Executive or any later date set forth
in such notice of termination.
(e) In the event the Executive or
the Company elects not to renew this Agreement pursuant to
Section 1 above, (i) the Executive shall have no right to
receive any compensation or benefit under this Agreement on and
after the Effective Date of the Termination (as defined below in
this Section 5.1(e)) other than Annual Salary earned and accrued
under this Agreement prior to the Effective Date of the
Termination, any bonus for any prior years not yet paid, any bonus
earned with respect to the calendar year in which the Effective
Da
