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Exhibit 10.1
SEPARATION AGREEMENT AND GENERAL RELEASE
This
Separation Agreement and General Release (the
“Agreement”) is made this 20th day of May, 2008
between Tara Poseley (the “Employee”) and The
Children’s Place Services Company, LLC and its direct
and indirect parent, subsidiaries and affiliated corporations
(collectively, the “Employer” or the
“Company”).
1.
Termination of Employment .
The parties agree that the Employee’s employment with the
Employer shall terminate effective May 27, 2008 (the
“Separation Date”).
2.
Separation Payment .
(a) In consideration for entering into this Agreement, the Employer
shall pay to the Employee the sum of Nine Hundred Sixty-Seven
Thousand Five Hundred Dollars ($967,500), less legally required
payroll deductions (“Separation Payment”). Of that
amount, $322,500 (“Initial Separation Payment”) will be
severance pay payable on involuntary termination of employment for
good reason under the Employment Agreement dated July 28, 2006, as
amended (the “Employment Agreement”) and the balance of
$645,000 (“Additional Separation Payment”) will be
payable on involuntary termination of employment for good reason
under the Employment Agreement. The Company will pay the Initial
Separation Payment in thirteen (13) equal bi-weekly installments
with the first such installment paid on the first pay period
following the Separation Date. The Company will pay the Additional
Separation Payment to Employee in twenty-six (26) equal bi-weekly
installments with the first such installment paid on the fourteenth
(14
th )
pay period following the Separation Date. The parties acknowledge
that they have reviewed the matter and have determined that the
restrictions of Section 409A(a)(2)(B)(i) of the Internal Revenue
Code of 1986, as amended, concerning payments to “specified
employees” are not applicable to the Initial Separation
Payment and that the Initial Separation Payment is not subject to
any delay of payment because the Initial Separation Payment
qualifies as separation pay under Treasury Regulation
1.409A-1(b)(9) which is exempt from the restrictions of Section
409A.
The
parties intend that the Initial Severance Payment under this
Section and the continuation of health benefits under Section
3(a) will qualify as exempt from the restrictions of Section
409A of the Code
,
as
amended, and final regulations under Section
409A.
Notwithstanding
any other provision of this Agreement, to
the extent any payments under Section 2(a), 3(a) or both could
become subject to penalties,
interest and additional income
tax under Section 409A of the Code, the parties will cooperate
to amend this Agreement to comply with Section 409A and to
provide Employee with the
same or equivalent value of benefits
described under the applicable Section in a manner that does
not result in penalties, interest or additional income
tax. The
Employee will cooperate with the Company to make any
amendment, retroactively if necessary, which Employee and the
Company reasonably determine necessary or advisable to
conform
this Agreement to, and
to
satisfy the conditions of, Section
409A of the Code and
related regulations and rulings in
a manner that does not result in adverse
income tax consequences to
Employee.
(b)
The parties agree that the Employer shall pay to the Employee
a bonus in the amount of Three Hundred Twenty-Two Thousand
Five Hundred Dollars ($322,500), less legally required payroll
deductions, which amount shall be paid on the date the
Employer makes the bonus payment to other eligible named
executive officers regardless of whether Employee is employed
at the payout date.
(c)
In addition to the payment set forth above in Section 2(a),
the parties acknowledge that the Employee shall receive, in
Employee’s final paycheck to be issued on May 23, 2008,
all wages from May 4-27, 2008 in the total amount of Forty-Two
Thousand One Hundred Seventy-Three Dollars and Eight Cents
($42,173.08), less legally required payroll deductions, and
payment for accrued paid time off in the total amount of
Ninety Three Thousand Six Hundred Forty-Eight Dollars and
Seventy-Three Cents ($93,648.73), less legally required
payroll deductions.
(d)
The Employer represents and warrants, and the Employee
acknowledges, that the consideration paid to the Employee
under this Agreement is at least equal to or exceeds the
amount the Employee would ordinarily be entitled to upon
termination of the Employee’s employment.
3.
Other Benefits .
(a) Any and all other employment benefits received by the Employee
shall terminate effective as of the Separation Date, except that in
the event the Employee elects to continue medical, dental, and
vision benefits though COBRA, the Employer agrees to waive the
applicable premium cost that Employee would otherwise be required
to pay for continued group health coverage under Employer’s
medical and dental plans for a period of eighteen (18) months.
Employer’s obligation to waive the applicable premium cost
under this Section 3(a) shall be reduced to the extent of receipt
of substantially equivalent coverage by Employee from any successor
employer.
(b)
The Employee agrees that the Employee is not entitled to and
will not seek any further consideration, including, but not
limited to, any wages, vacation pay, sick pay, disability pay,
bonus, compensation, payment or benefit from the Released
Parties (as defined in Section 10) other than that to which
the Employee is entitled pursuant to this
Agreement.
4.
Removal from Company Positions and Indemnification
.
The Employee agrees that as of the Separation Date, the Employee
shall resign from all positions held on behalf of the Company
including but not limited to officer, agent, representative,
trustee, administrator, fiduciary and signatory; provided, however,
that the Employee shall continue as a board member for Hoop
Holdings, Inc., Hoop Retail Stores, LLC, Hoop Canada Holdings, Inc.
and Hoop Canada, Inc. (collectively, the “Hoop
Entities”) through confirmation of the plan of liquidation or
equivalent confirmation with respect to the Hoop Entities and the
Employee shall be entitled to receive any compensation or expense
reimbursement as other similarly situated independent board members
of the Hoop Entities. In addition, with respect to all acts or
omissions of Employee which occurred prior to the Separation Date,
the Company agrees to continue to indemnify the Employee to the
same extent that the Employee was indemnified prior to the
Separation Date and that the Employee shall retain the benefit of
all directors and officers liability insurance and coverage
maintained by the Company with respect to claims made during the
period provided by the Company’s current policy and to the
extent provided by any future policy from time to time maintained
by the Company with respect to other former executives of the
Company, in each case on the terms and conditions of such
policy.
5.
Return of Company Property .
Company confirms that Employee has returned all laptops, cellular
telephones, blackberries, keys, locks, credit cards, documents,
records, materials, and other information of any type whatsoever
that is the property of the Company. Employee further agrees that
Employee shall not retain any copies or reproductions of
correspondence, memoranda, reports, notebooks, drawings,
photographs, or other documents relating in any way to the affairs
of the Company or its vendors.
6.
Consultation with Counsel and Voluntariness of Agreement
.
(a) The Employee acknowledges that the Employer has advised the
Employee in writing to consult with an attorney prior to executing
this Agreement. The Employee further acknowledges that, to the
extent desired, the Employee has consulted with the
Employee’s own attorney in reviewing this Agreement, that the
Employee has carefully read and fully understands all the
provisions of this Agreement, and that the Employee is voluntarily
entering into this Agreement.
(b)
The
Employee further acknowledges that the Employee has had a
period of at least twenty-one (21) days in which to consider
the terms of this Agreement.
(c)
The
Employee acknowledges that the Employee has been informed in
writing that the Employee has seven (7) calendar days
following the execution of this Agreement to revoke it, and
that such revocation must be in writing, hand delivered or
sent via overnight mail and actually received by the Employer
within such period. It is specifically understood that this
Agreement shall not be effective or enforceable, and the
payments and benefits set forth in this Agreement shall not be
paid until the seven-day revocation period has
expired.
7.
Confidentiality of Agreement .
The Employee agrees not to disclose the existence of this agreement
or the terms and conditions of this Agreement to any person or
entity, except: (a) to comply with this Agreement; (b) to the
Employee’s legal, financial or tax advisors, spouse, and to
the Internal Revenue Service or any similar state or local taxation
authority; or (c) as otherwise required by law.
8.
Non-Solicitation, Use of Name, and Confidential
Information .
The Employee acknowledges and agrees that she continues to be bound
by the portions of Section 9 of the Employment Agreement attached
to this Agreement as Exhibit A; provided, however, to the extent of
a conflict between Section 9 of the Employment Agreement and this
Agreement, the terms of this Agreement shall govern.
9.
Confirmation of Employment .
The Employer shall, if called upon, confirm the Employee’s
dates of employment and position with the Employer.
10.
Release .
(a) Employee represents and warrants that she is not aware of any
misconduct by any employee or director of the Company that Employee
should report in accordance with the Company’s Code of
Business Conduct or any irregularity in the Company’s books
or records or any other matter relating to the Company’s
accounting that could properly be reported by Employee pursuant to
the procedures established by the Company for making such reports,
except any that has already been reported by Employee in writing to
the appropriate personnel of the Company. In exchange for the
consideration set forth in Sections 2 and 3, the Employee, on
behalf of the Employee and the Employee’s agents, assignees,
attorneys, heirs, executors and administrators, voluntarily and
knowingly releases the Employer, as well as the Employer’s
successors, predecessors, assigns, parents, subsidiaries,
divisions, affiliates, officers, directors, shareholders,
employees, agents and representatives, in both their individual and
representative capacities (collectively, the
“Employer’s Released Parties”), from any and all
claims, causes of action, suits, grievances, debts, sums of money,
agreements, promises, damages, back and front pay, costs, expenses,
and attorneys’ fees by reason of any matter, cause, act or
omission arising out of or in connection with the Employee’s
employment or separation from employment with the Employer,
including but not limited to any claims based upon common law, any
federal, state or local employment statutes or civil rights laws.
Included in this release, without limiting its scope, are claims
arising under Title VII of the Civil Rights Act of 1964, as
amended; the Age Discrimination in Employment Act; the Older
Workers Benefit Protection Act; the Americans with Disabilities
Act; the Family and Medical Leave Act, the Fair Labor Standards Act
of 1938 as amended by the Equal Pay Act of 1963; the Employee
Retirement Income Security Act of 1974; the New Jersey
Conscientious Employee Protection Act; the New Jersey Law Against
Discrimination; the New Jersey Family Leave Act; the New Jersey
Wage Payment Act; the Sarbanes-Oxley Act of 2002; and any other
laws prohibiting discrimination, retaliation, wrongful termination,
failure to pay wages, breach of contract, defamation, invasion of
privacy, whistleblowing or infliction of emotional distress, or any
other matter. This release shall apply to all known, unknown,
unsuspected and unanticipated claims, liens, injuries and damages
that have accrued to the Employee as of the date of this
Agreement.
(b)
This
release does not waive rights or claims that may arise after
this release is executed and does not waive any rights or
claims which cannot be waived as a matter of law. This
Agreement does not affect the Employee’s right to file a
charge with the EEOC or to participate in any investigation
conducted by the EEOC, but the Employee acknowledges that the
Employee is not entitled to any other monies other than those
payments described in this Agreement.
(c)
It
is the intention of the Employee in executing this Agreement
that it shall be effective as a bar against each and all
claims, causes of action, suits, grievances, debts, sums of
money, controversies, agreements, promises, damages, back and
front pay, costs, expenses, attorneys’ fees and remedies
of any type described in Section 10(a) above. In furtherance
of this intention, the Employee expressly waives any and all
rights and benefits conferred upon the Employee by the
provisions of Section 1542 of the California Civil Code, which
states:
A general release does not extend to claims which the creditor does
not know or suspect to exist in his or her favor at the time of
executing the release, which if known by him or her must have
materially affected his or her settlement with the
debtor.
(d)
Employee
agrees to execute and deliver to Company on the Separation
Date a furth
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