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Exhibit 10.2
GENERAL RELEASE AND AGREEMENT TO AMEND
EMPLOYMENT AGREEMENT
THIS GENERAL RELEASE AND AGREEMENT TO AMEND
EMPLOYMENT AGREEMENT (“Agreement”) is made and entered
into on February 1, 2008, by and between Lawrence L. Spanley, Jr.
(hereinafter “Employee”), a Missouri resident, and
Bakers Footwear Group, Inc. (hereinafter the “Company”)
(collectively, the “Parties”). For and in consideration
of the following promises, the parties agree to the
following:
RECITALS
WHEREAS, Employee has served as Chief Financial
Officer, Executive Vice President, Secretary, and Treasurer of the
Company; and
WHEREAS, Employee entered into an employment
agreement (the “Employment Agreement”) with the Company
on August 28, 2006; and
WHEREAS, pursuant to its automatic renewal
provisions, the Employment Agreement automatically renewed for a
one-year term on August 25, 2007; and
WHEREAS, the Employment Agreement’s terms
provide that the Parties could amend and modify the terms of the
Employment Agreement by written agreement executed by the Company
and Employee; and
WHEREAS, the Parties desire to amend the Employment
Agreement to accommodate Employee’s desire to resign from his
current positions of employment with the Company, effective at the
end of the day on February 2, 2008 (the “Resignation
Date”), but to remain employed with the Company in a reduced
capacity as special advisor to the principal executive officer and
the principal financial officer pursuant to an amended version of
the Employment Agreement (attached hereto as Attachment A),
starting the day after the Resignation Date, so that Employee may
pursue other personal interests not adverse to the Company;
and,
WHEREAS, the Parties desire to resolve any and all
issues between them, actual or potential, and to enter into a full
and final settlement of all matters between the Parties, including,
but not limited to, any issues which might arise out of the instant
amendment of the Employment Agreement.
NOW THEREFORE, for and in consideration of the
releases, covenants and undertakings hereinafter set forth, and for
other good and valuable consideration, which each party hereby
acknowledges, it is agreed as follows:
1. Employment Agreement Amendments . In
exchange for the consideration detailed in this Agreement,
including but not limited to the Company’s accommodation of
Employee’s desire to assume a reduced role of employment for
the Company prior to the end of Employee’s current contract
term and the Employee’s provision of services to the Company
as an special advisor to the principal executive officer and the
principal financial officer beginning on the day after the
Resignation Date, the Parties hereby
amend and restate the Employment Agreement so that
it matches the terms and language set forth in Attachment A
(“Amended Employment Agreement”). The Parties agree
further that, although this Agreement becomes fully binding on the
Effective Date, as defined in Paragraph 24, the Parties’
amendments to the Employment Agreement will not take effect until
the Resignation Date; therefore, until the Resignation Date, the
un-amended Employment Agreement will continue to govern
Employee’s employment relationship with the
Company.
2.
Payments . The Company
will make the payments described below, which are in addition to
those payments and benefits to which Employee is entitled by way of
his amended Employment Agreement with the Company, in consideration
and in exchange for Employee’s promises, agreements,
releases, and obligations set forth herein, so long as Employee
submits this Agreement properly executed to the Company on or
before February 20, 2008, does not thereafter revoke this Agreement
pursuant to Paragraph 24, and adheres to the promises and
agreements set out in the balance of this Agreement. Employee,
however, will not be eligible for participation in any additional
bonus or equity awards or programs following the Resignation Date;
provided, however, that Employee shall remain eligible for
participation in any bonus paid at the discretion of the Chairman
and Chief Executive Officer. Furthermore, Employee will not be
eligible to participate in any other benefits except as outlined in
this Agreement or in the amended Employment Agreement, following
the Resignation Date.
(A)
Payment Amount and Structure
. The Company will pay Employee a total of One
Hundred Thirty-Five Thousand Dollars and Six Cents ($135,000.06)
(“Total Resignation Payment”), less withholdings
required by law and in regular two-week intervals consistent with
the Company’s regular pay cycles. The parties understand and
agree that the Total Resignation Payment does not include any
payments made by the Company to Employee prior to February 3, 2008,
but that when taken together with the total base salary to which
Employee is entitled under Paragraph 4 of the Amended Employment
Agreement, payment of the Total Resignation Payment will result in
Employee’s regular pay cycle payments from the Company
remaining the same as they were during the fiscal year 2007 for the
twenty-six (26) pay installments following February 3, 2008. If
Employee’s death occurs during the period of February 3,
2008, through January 31, 2009, any installments of the Total
Resignation Payment owing to Employee at the time of his death
shall be paid to his wife, Linda, in the intervals provided herein,
or if she is not then living, or Employee is not married to her at
the time of his death, then to Employee’s estate in a lump
sum within one hundred twenty (120) days of Employee’s death.
In any event, any amount of the Total Resignation Payment owed to
Employee, Employee’s wife, or Employee’s estate under
this Paragraph 2(A) shall have been paid before March 15,
2009.
(B)
Acknowledgment of Consideration
. Employee acknowledges and agrees the payments
referenced in Paragraph 2(A) are valuable consideration to him and
that he would not otherwise be entitled to such consideration
absent his execution of this Agreement, which includes
Employee’s general release of the Company and various other
promises.
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3.
Forfeiture of Rights and Entitlements under
Un-Amended Employment Agreement .
Employee agrees that, to the extent any rights and entitlements to
payments of any kind or any other entitlements, statuses, titles,
or benefits of any kind—potential or realized—provided
by the Employment Agreement as it existed prior to the
Parties’ execution of this Agreement are inconsistent with
the rights and entitlements to payments of any kind or any other
entitlements, statuses, titles, or benefits of any
kind—potential or realized—provided by the Amended
Employment Agreement, Employee forfeits all such inconsistent
rights and entitlements to payments and any other entitlements,
statuses, titles, or benefits of any kind—potential or
realized—provided by the Employment Agreement prior to its
amendment by this Agreement.
4.
Bonus Plan . The
Parties agree that this Agreement does not affect any 2007 bonus
awards Employee possessed at the time of his execution of this
Agreement; however, Employee acknowledges and agrees that he has no
entitlement to any other bonus award or to participate in any other
bonus plan; provided, however, that Employee shall remain eligible
for participation in any bonus paid at the discretion of the
Chairman and Chief Executive Officer.
5.
Stock Options . The
Parties agree that this Agreement does not affect any of
Employee’s rights to exercise any stock options that the
Company issued or granted to him since the Company became a
publicly-traded entity and that Employee possessed at the time of
his execution of this Agreement; however, Employee acknowledges and
agrees that he has no entitlement to any other stock options with
the Company.
6.
2005 Performance Incentive Plan
. The Parties agree that this Agreement does not
affect any entitlement to any payment under the 2005 Performance
Incentive Plan that Employee possessed at the time of his execution
of this Agreement; however, Employee acknowledges and agrees that
he has no entitlement to participate in any other performance
incentive plan with the Company.
7.
Vesting in Retirement Plans
. As of the Resignation Date, Employee was fully
vested in the Company’s 401(k) plan.
8.
Release of Claims .
Employee, for and on behalf of Employee and Employee’s heirs,
beneficiaries, executors, administrators, successors, assigns, and
anyone claiming through or under any of the foregoing, hereby
agrees to, and does, remise, release and forever discharge the
Company and its current and former agents, officers, employees,
directors, divisions, parents, subsidiaries, affiliates,
representatives, attorneys, successors, and assigns (hereinafter,
collectively, the “Company Releasees”) from any and all
matters, claims, demands, damages, causes of action, debts,
liabilities, controversies, judgments and suits of every kind and
nature whatsoever, foreseen or unforeseen, known or unknown, which
have arisen or could arise between Employee and the Company
Releasees from matters, actions, or inactions which occurred prior
to or on the Offer Date (as defined below in Paragraph 24),
including but not limited to all such claims and matters arising
from or in connection with Employee’s employment with the
Company, his resignation from the positions of Chief Financial
Officer, Executive Vice President, Secretary, and Treasurer of the
Company, his acceptance of the position of
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special advisor to the principal executive officer
and the principal financial officer, Employee’s Employment
Agreement, and the offer, negotiation, and acceptance of this
Agreement. Employee understands that the
provisions of this Paragraph mean that he cannot bring a lawsuit
against the Company Releasees for any reason, except for the
interpretation, breach, and/or enforcement of the terms of this
Agreement or the terms of the Amended Employment Agreement, which
is attached hereto as Exhibit A.
9.
Agreement Not to File Suit or Other
Claims . Employee, for and on behalf of
Employee and Employee’s beneficiaries, executors,
administrators, successors, assigns, and anyone claiming through or
under any of the foregoing, agrees that they will not file or
otherwise submit any charge, claim, complaint, or action to any
agency, court, organization, or judicial forum (nor will Employee
permit any person, group of persons, or organization to take such
action on Employee’s behalf) against the Company Releasees
arising out of any actions or non-actions on the part of the
Company Releasees arising before or on the Offer Date. If any
person or entity should bring such a charge, claim, complaint, or
action on Employee’s behalf, Employee hereby waives and
forfeits any right to recovery under said claim and will exercise
every good faith effort to have such claim dismissed. The
provisions of this Paragraph and Paragraph 10, below, shall not be
construed to prevent Employee from filing a charge with the Equal
Employment Opportunity Commission (“EEOC”), only to the
extent he is permitted to do so by law. However, Employee expressly
waives and disclaims any right to compensation or other benefit
which may inure to him as a result of any such charge and hereby
expressly agrees to provide any such benefit or pay any such
compensation directly to the Company. Employee understands that the provisions of this Paragraph mean
that he cannot bring a lawsuit against the Company Releasees for
any reason, except for the interpretation, breach, and/or
enforcement of the terms of this Agreement or the terms of the
Amended Employment Agreement, which is attached hereto as Exhibit
A.
10.
Claims Covered by Agreement
. The charges, claims, complaints, matters, demands,
damages, and causes of action referenced in Paragraphs 8 and 9,
above, include, but are not limited to, (i) any breach of an
actual or implied contract of employment between Employee and the
Company Releasees, (ii) any claim of unjust, wrongful, or
tortious discharge (including any claim of fraud, negligence,
retaliation for whistleblowing, or intentional infliction of
emotional distress), (iii) any claim of defamation or other
common-law action, (iv) any claim related to the issuance or
non-issuance of stock, or (v) any claims of violations arising
under whistleblower employee protection provisions of the
Sarbanes-Oxley Act of 2002, 18 U.S.C. § 1514A, the Civil
Rights Act of 1964, as amended, 42 U.S.C. § 2000e
et seq
., the Civil Rights Act of 1866, 42 U.S.C.
§ 1981, the Age Discrimination in Employment Act, 29
U.S.C. § 621 et
seq ., (including but
not limited to the Older Worker’s Benefit Protection Act),
the Americans with Disabilities Act of 1990, 42 U.S.C.
§ 12101 et
seq ., the Fair Labor
Standards Act of 1938, as amended, 29 U.S.C. § 201
et seq
., the Rehabilitation Act of 1973, as amended, 29
U.S.C. § 701 et
seq ., the Family and
Medical Leave Act, 29 U.S.C. § 2601, the Employee
Retirement Income Security Act, 29 U.S.C. § 1001,
et seq
. or the Missouri Human Rights Act, R.S. Mo. §
213.010, et. seq. , the Missouri
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Service Letter Statute, R.S. Mo. § 290.140, the
Missouri Employment Security Act, R.S. Mo. § 288.010,
et seq.
, retaliation for exercise of rights Under the
Missouri Worker’s Compensation Act, R.S. Mo.§
287.010 et seq. ; the Missouri Aids Act, R.S.Mo.
§ 191.6665, et
seq. , as amended; the
Missouri Equal Pay Law, R.S.Mo. § 290.400-290.460
et seq
., as amended; the Missouri Handicap Discrimination
Statute, R.S.Mo. § 209.150, 290.160, 290.162, and
209.180 et seq ., as amended; the Missouri
Genetic Testing Information Bias Law, R.S.Mo. §375.1300,
375.1303, 375.1306 and 375.1309 et seq ., as amended; the Missouri Smokers Rights Law, R.S.Mo.
§ 290.145 et
seq. , as amended, or
any other federal, state, or local statutes or ordinances or common
laws, or any claims for pay, vacation pay, business expenses,
insurance, welfare benefits, or any other benefits of employment
with the Company Releasees arising from or relating to
Employee’s Employment Agreement as it existed prior to its
amendment by way of this Agreement, from any other agreement with
the Company Releasees except the amended Employment Agreement
attached hereto as Attachment A, or from any other events occurring
prior to or on the Offer Date other than those payments and
benefits specifically provided herein. It is expressly agreed and
understood that Employee does not release any claims arising out of
the Amended Employment Agreement or this Agreement.
11.
Release of Benefit Claims. Employee further releases and waives any claim for any type of
compensation or employee benefits with the Company accruing prior
to or on the Offer Date, except (a) to the extent specifically
provided herein, and (b) with respect to accrued paid vacation,
accrued paid sick leave, or participation in the Company’s
401(k) plan.
12.
Representations and Warranties Regarding the
FMLA, FLSA, and Sarbanes-Oxley Act. Employee represents and warrants that he is not aware of any
circumstances that might entitle Employee to a leave of absence
under the Family and Medical Leave Act (“FMLA”) or any
fact which might justify a claim against the Company for violation
of the FMLA. Employee represents and warrants further that Employee
has received or will receive under the terms of this Agreement any
and all wages and commissions for work performed and all overtime
compensation and FMLA leave to which Employee may have been
entitled, and that Employee is not currently aware of any facts or
circumstances constituting a violation by the Company of the FMLA
or the Fair Labor Standards Act (“FLSA”). Employee
represents and warrants further that he has not received any notice
that, nor is he personally aware of any allegation that either he
or the Company has violated any provision of the Sarbanes-Oxley Act
of 2002. Employee specifically warrants that he has discussed this
issue and all underlying facts with his attorney prior to making
these representations.
13.
Confidentiality of Agreement
. Notwithstanding the Company’s duty to comply
with Securities Exchange Commission (“SEC”) public
disclosure requirements, in exchange for the receipt of the
payments set out above, Employee agrees that he will not publicize
this Agreement directly, either in specific or as to general
content, to either the public generally, to any employee or agent
of the Company, or to any other person or entity, except as
Employee might be lawfully compelled to give testimony by court or
federal agency process, lawful deposition, interrogatory, or
arbitrator of competent
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jurisdiction, or to participate in an EEOC, SEC, or
other federal agency investigation, or except as otherwise provided
in this Paragraph 13. Furthermore, the parties do not intend for
this Agreement to restrict Employee from engaging in any
whistleblower activity protected by federal law; thus,
Employee’s publicity of and discussions about the terms of
this Agreement, if made in connection with whistleblower activity
protected by federal law, will not constitute a breach of this
Agreement. Employee’s agreement to keep confidential the
terms of this Agreement requires Employee to refrain from
communicating regarding the terms of this Agreement with anyone
except Employee’s immediate family, Employee’s
attorney, accountant, or financial advisor who has a legitimate
need to know the terms of this Agreement in order to render
professional advice or services to Employee, and Employee’s
prospective and future employers (only to the extent provided
expressly by the provisions of this Paragraph 13); otherwise,
Employee agrees not to identify or reveal any other terms of the
Agreement. The Company recognizes Employee may need to disclose the
provisions of Paragraph 14 to prospective employers, and to that
limited extent, Employee may, without violating this Agreement,
disclose the provisions of Paragraph 14 to prospective employers.
Employee agrees that this Paragraph constitutes a material term of
this Agreement, and that any breach of this provision will be
considered a material breach and will, among all other available
remedies, excuse the Company from any further obligations to
Employee under this Agreement, including any remaining payments set
forth in Paragraph 2 hereof. This shall not be construed as a
limitation of remedies, and the Company retains all rights to
pursue any and all claims or actions against Employee as a result
of Employee publicizing or discussing the terms of this Agreement
in a manner prohibited by this Paragraph.
14.
Non-Disclosure of Confidential
Information . The Parties hereby
incorporate herein the confidentiality provisions set forth in
Paragraph 12 of the Amended Employment Agreement.
15.
Reasonable Scope of Agreement
. Employee and the Company acknowledge that the
scope of this Agreement, including without limitation, Paragraphs
13 and 14 of this Agreement, is reasonable in light of its narrow
focus and the legitimate interests of Employee and the Company to
be protected.
16.
No Admission of Wrongdoing . The parties to this Agreement agree that nothing in this
Agreement is an admission by any party hereto of any wrongdoing,
either in violation of an applicable law or otherwise, and that
nothing in this Agreement is to be construed as such by any
person.
17.
Knowing and Voluntary Agreement
. Employee acknowledges further that he understands
this Agreement; the claims he is releasing herein; the promises and
agreements he is making herein, including but not limited to the
agreement to amend his Employment Agreement; and the effect of his
signing this Agreement. Employee represents, declares, and agrees
further that he voluntarily accepts the consideration described
above in Paragraph 2 for the purpose of making a full and final
compromise, adjustment, and settlement of all claims or potential
claims against the Company from any action or inaction taking place
prior to or on the Offer Date.
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18.
Choice of Law . Because
of the Company’s and Employee’s substantial contacts
with Missouri, the fact that the Company hired Employee in
Missouri, Employee’s primary place of work for the Company
has been located in Missouri, and the Parties’ interests in
ensuring that disputes regarding the interpretation, validity, and
enforceability of this Agreement are resolved on a uniform basis,
the Parties agree that the Agreement shall be interpreted,
construed, applied, and governed by and according to the laws of
the State of Missouri, without regard for any conflict of law
principles.
19.
Modification . Subject
to Paragraph 21 of this Agreement, the Parties agree that this
Agreement may not be modified, altered, or changed except by a
written agreement signed by the Parties.
20.
Entire Agreement . The
parties acknowledge that this constitutes the entire agreement
between them superseding all prior written and oral agreements,
regarding Employee’s resignation from the positions of Chief
Financial Officer, Executive Vice President, Secretary, and
Treasurer of the Company, and there are no other understandings or
agreements, written or oral, among them on the subject of
Employee’s resignation. Nothing in Paragraph 20 of this
Agreement is intended to terminate, render void or voidable, or
breach any of the terms of the amended Employment Agreement,
attached hereto as Attachment A. Furthermore, nothing in this
Agreement supersedes the Company’s Option Agreements and
Awards or Performance Share Agreements.
21.
Severability . If any
provision of this Agreement is deemed by a court of competent
jurisdiction to be unenforceable because it is overbroad or
unreasonable, then such provision shall be modified and, to the
maximum extent permitted under applicable law, enforced. If any
provision of this Agreement is held to be invalid and not subject
to modification, the remaining provisions shall remain in full
force and effect.
22.
Rule of Construction .
The rule of construction to the effect that ambiguities are to be
resolved against the drafting party shall not be employed in
interpreting this Agreement. The parties intend for this Agreement
to satisfy the provisions of the Age Discrimination in Employment
Act of 1967, as amended, and the Sarbanes-Oxley Act of 2002, and
this Agreement shall always be construed or limited in conformity
with such provisions.
23.
Execution and Effective Date
. Separate copies of this document shall constitute
original documents which may be signed separately but which
together will constitute one single agreement. This Agreement will
not be binding on any party, however, until, at a minimum, it is
signed by all parties or their rep
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