|
EXHIBIT 10.3
SEPARATION AGREEMENT
(this "Agreement") dated as of July 11, 2007, between Jones Apparel
Group, Inc., a Pennsylvania Corporation (the "Company"), and Peter
Boneparth (the "Executive").
WHEREAS the Executive
and the Company entered into an Amended and Restated Employment
Agreement dated as of March 11, 2002, which was amended on February
28, 2003 (as amended, the "Employment Agreement");
WHEREAS the Executive
and the Company have agreed that the Executive's service with the
Company will terminate on, and such termination will be effective
as of, July 12, 2007 (the "Separation Date"); and
WHEREAS the Executive
and the Company wish to enter into this Agreement to set forth the
terms and conditions of the Executive's separation;
NOW, THEREFORE, in
consideration of the mutual agreements, provisions and covenants
contained herein, and intending to be legally bound hereby, the
parties hereto agree as set forth below.
1.
Definitions. Capitalized terms used but not defined herein
shall have the meanings assigned to them in the Employment
Agreement.
2. Separation.
Except as otherwise provided herein, the Employment Agreement shall
remain in full force and effect in accordance with its terms until
the Separation Date. Effective as of the Separation Date, the
Executive's service as a director, officer and employee of the
Company and all its affiliates shall terminate. The Executive and
the Company hereby waive all provisions of the Employment Agreement
regarding advance notice of termination.
3. Payments.
(a) Accrued Amounts. Pursuant to clause (i) of Section
6(c)(i) of the Employment Agreement, on the Separation Date, the
Company shall pay the Executive a lump-sum cash amount equal to the
sum of (i) any unpaid salary earned through the Separation Date and
(ii) any unpaid reimbursable expenses incurred by the Executive on
behalf of the Company for which appropriate documentation was
submitted by the Executive no less than two business days prior to
the Separation Date. The Executive acknowledges that he has
previously received the full amount of all bonuses payable to him
by the Company, except the prorated bonus described in Section
3(b).
(b) Prorated
Bonus. Pursuant to clause (ii) of Section 6(c)(i) of the
Employment Agreement, on the Separation Date, the Company shall pay
the Executive a lump-sum cash amount equal to $1,596,774.19.
(c) Severance
Payments. Pursuant to clause (iii) of Section 6(c)(i) of the
Employment Agreement, on the first business day of each month
during the period from August 1, 2007 through March 31, 2009, the
Company shall pay the Executive a lump-sum cash amount equal to
$458,333.33.
1
(d) Continuation
of Benefits. In satisfaction of the Company's obligation
pursuant to clause (iv) of Section 6(c)(i) of the Employment
Agreement, (i) during the period from the Separation Date through
March 31, 2009, the Executive (and his eligible dependents) shall
continue to participate in the Company's medical and dental plans
in which the Executive is participating on the date hereof, which
participation shall be on the same basis as in effect for other
senior executives of the Company from time to time, and (ii) on the
Separation Date, the Company shall pay the Executive a lump-sum
cash amount equal to $379,801.59. The Executive agrees that the
Company shall have no obligation to the Executive in respect of
such clause of the Employment Agreement other than the continuation
of the benefits referred to in clause (i) of the preceding sentence
and the making of the cash payment referred to in clause (ii) of
the preceding sentence.
(e) Outplacement
Services. Pursuant to clause (v) of Section 6(c)(i) of the
Employment Agreement, the Company shall reimburse the Executive for
up to $10,000 of executive outplacement services.
(f) Equity
Awards. Pursuant to Section 6(c)(ii) of the Employment
Agreement, on July 16, 2007, (i) all Restricted Shares then held by
the Executive shall become fully vested and become immediately free
of restrictions and (ii) all Options then held by the Executive
shall become fully exercisable and remain exercisable for the same
period following the Separation Date as would apply if the
Executive's employment had not terminated. The Company and the
Executive agree that all such Restricted Shares and Options
(including the exercise prices and expiration dates thereof) are
set forth on Exhibit A hereto.
4. No Other
Payments; Survival. The Executive acknowledges and agrees that,
except as otherwise expressly provided in this Agreement or in the
provisions of the Employment Agreement that are incorporated by
reference herein, the Executive shall have no right or entitlement
from or after the Separation Date to any compensation, bonus,
benefits or other amounts in connection with the Executive's
service with the Company and its affiliates or the termination of
the Executive's services (whether pursuant to the Employment
Agreement, any plan, program or policy of the Company or
otherwise). The Executive and the Company agree that, from and
after the Separation Date, (i) the Executive shall remain subject
to the provisions of Sections 8 (Company Property), 9 (Confidential
Information) and 10(a), (b), (c) and (d) (Competition; Recruitment;
Non-Disparagement) of the Employment Agreement, in each case, in
accordance with their terms and (ii) the Company shall remain
subject to the provisions of (A) Sections 10(c) (Non-disparagement)
and 13 (Indemnification) of the Employment Agreement, in each case,
in accordance with their terms, (B) Sections 12(a) (Company's
Successors), 14 (Interest on Late Payments) and 16 (Attorneys'
Fees) of the Employment Agreement, in each case, in accordance with
their terms as applied to this Agreement and (C) Section 3(e) of
the Employment Agreement with respect to expenses otherwise
reimbursable thereunder that are incurred prior to the Separation
Date and not previously reimbursed. Each party hereto shall bear
its own legal fees and expenses incurred in connection with the
negotiation and execution of this Agreement.
2
5.
Press Release. At least one day prior to the public
announcement of the Executive's separation from the Company, the
Executive shall be provided with a copy of a substantially final
draft of the press release that the Company intends to issue
regarding the Executive's separation. The Executive shall be
provided with the opportunity to provide comments on such release
to the Company, but the Company shall have no obligation to accept
any such comments. The final draft of such press release is
attached hereto as Exhibit B. For the avoidance of doubt, this
Section 5 and the Company's obligations hereunder shall only apply
to the portions of such press release related to the Executive and
the Executive's separation and shall not apply to any other portion
of such press release.
6.
Mutual Release and Waiver. In consideration of the mutual
promises contained in this Agreement, the Company and the Executive
agree as set forth below.
(a)
Release by the Company. Subject to the limitations set forth
below in Section 6(e), the Company, on behalf of itself and its
affiliates, irrevocably releases the Executive, his attorneys,
agents, representatives, advisors, executors, administrators and
heirs and the successors, predecessors and assigns of each of the
foregoing (and those acting on their behalf in any capacity
whatsoever) from all claims, counterclaims, actions, complaints,
causes of actions, judgments, debts, rights to indemnification,
demands or suits, at law or in equity, known or unknown, arising
from, relating to or otherwise concerning the Executive's
employment with the Company or the termination thereof, which the
Company or any of its past and present parents, subsidiaries or
affiliates and the successors, predecessors and assigns of each of
the foregoing ever had, now have or hereafter can, shall or may
have, for, upon or by reason of any matter, cause or thing
whatsoever from the beginning of the
|
