Exhibit 10.66
SEVERANCE AGREEMENT
This Severance Agreement (the
“Agreement”) is made as of the Executive’s
employment commencement date, between The Talbots, Inc., a Delaware
corporation (together with its subsidiaries, the
“Company”) and Paula Bennett (the
“Executive”). This Agreement sets forth the agreement
of the parties relating to the severance arrangements for the
Executive under certain circumstances. Capitalized terms used in
this Agreement are defined in Section 7 hereof.
1. Severance Pay and
Associated Benefits Upon a Qualified Termination .
(a)
Severance Benefits . In the event of a Qualified
Termination, and subject to the terms of this Agreement, the
Company will provide to the Executive the payments and benefits
described in this Section 1 (collectively, the
“Severance Benefits”).
(b)
Severance Pay . Subject to the terms of this Agreement, in
the event of a Qualified Termination, the Company will pay to the
Executive severance pay in the gross amount equal to 1.5 times the
Executive’s annual base salary in effect immediately prior to
such termination (the “Severance Payment”), payable in
equal installments in accordance with normal Company payroll
practices over a 18 month period beginning immediately
following the Termination Date (the “Severance
Period”).
(c)
Benefits Continuation . Subject to the terms of this
Agreement, upon any such Qualified Termination, the Company will
also arrange for the Executive to continue to participate (through
COBRA or otherwise), on substantially the same terms and conditions
as in effect for the Executive (including any required employee
contribution) immediately prior to such termination, in the medical
and dental programs provided to the Executive immediately prior to
such termination until the earlier of (i) the end of the
Severance Period, or (ii) such time as the Executive is
eligible to be covered by comparable benefits of a subsequent
employer. The Executive agrees to notify the Company promptly if
and when the Executive begins employment with another employer and
if and when the Executive becomes eligible to participate in any
benefit or other welfare plans, programs or arrangements of another
employer. Executive agrees that any automobile/housing allowance or
other personal benefits provided by the Company to the Executive
immediately prior to such termination will cease as of the
Termination Date. The Company, however, may choose to make any
separate arrangements with the Executive to assist with the
transfer of any such benefits within 90 days of the
Termination Date.
(d)
Retirement Benefits . Nothing in this Agreement will modify
or otherwise limit any of the Executive’s rights and benefits
as may exist under the terms of any qualified, nonqualified or
supplemental retirement, 401(k), savings or deferred compensation
plans of the Company (excluding any severance or severance
compensation plans) (“Retirement Plans”), nor will any
benefits or amounts payable under any such Retirement Plans reduce
or offset any Severance Benefits afforded to the Executive under
this Agreement.
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(e)
Equity Awards .
(i) If
in the event of a Qualified Termination the Executive still holds
one or more options to purchase shares of Company stock which have
not expired and have not been fully exercised, the Executive (or
his or her heirs or estate), at any time within 3 years after
the Termination Date (but in no event after the option has
expired), may exercise any such options with respect to any shares
as to which the Executive could have exercised the options on the
Termination Date.
(ii) The
Executive agrees that until the expiration of 6 months from
the Termination Date, the Executive will not engage in the purchase
or sale of the Company’s common stock (including without
limitation any “cashless exercise” of any stock options
involving the sale of any Company common stock as part of such
option exercise) during any trading window “blackout”
or “quiet period” applicable to management level
employees (“Quiet Period”); provided that in no event
shall the Executive be prohibited from making a purchase or sale of
the Company’s stock or exercising stock options for the
Company’s stock if such sale, purchase or exercise is made
pursuant to a written plan for trading securities within the
meaning of Rule 10b5-1 under the Securities Exchange Act of
1934, as amended (a “10b5-1 Trading Plan”), and such
10b5-1 Trading Plan is consistent with the Company’s insider
trading policy and has been approved by the Company. The Executive
acknowledges that the Company reserves the right to modify the
Quiet Period from time to time in its sole and absolute discretion.
The Company will provide the Executive with notice of Quiet Periods
and changes thereto at the time it provides such notice to the
Company’s management level employees. In addition, the
Executive agrees to notify the Company’s General Counsel
prior to exercising any options or trading in the Company’s
common stock within such 6 month period following the
Termination Date to ascertain whether such transaction would
violate any Quiet Period covered by this subsection (e)(ii).
(iii) Except
as otherwise expressly set forth in any agreement between the
Executive and the Company relating to any restricted stock or
performance accelerated restricted stock award, in the event of a
Qualified Termination or other termination of employment, the
Executive agrees that the Company will be deemed to have exercised
its repurchase option with respect to any shares of unvested
restricted stock or performance accelerated restricted stock of the
Company held by the Executive as of the Termination Date, and the
Company will promptly pay the Executive $.01 for each share.
(f)
Withholdings . The Company may deduct from the
Executive’s Severance Payment and any other payments
otherwise due to the Executive, such withholding taxes and similar
governmental payments and charges as may be required.
(g)
Timing for Payment; Section 409A Restrictions .
Notwithstanding anything in this Agreement to the contrary, it is
the intention of the parties that this Agreement comply with
Section 409A of the Internal Revenue Code of 1986, as amended
(the “Code”), and any regulations or other guidance
issued thereunder, and this Agreement and the payments of any
benefits hereunder will be operated and administered accordingly.
Specifically, but not by limitation, the Executive agrees that if,
at the time of termination of employment, the Company is considered
to be publicly traded and the Executive is considered to be a
specified employee, as
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defined
in Section 409A (and as determined as of December 31
preceding the Executive’s termination of employment, unless
the Executive’s termination of employment occurs prior to
April 30, in which case the determination will be made as of the
second preceding December 31), then some or all of such
payments to be made under this Agreement as a result of the
Executive’s termination of employment will be deferred for no
more than 6 months following such termination of employment,
if and to the extent the delay in such payments is necessary in
order to comply with the requirements of Section 409A of the
Code after utilizing the short-term deferral and involuntary
separation pay plan regulations. Upon expiration of such
6 month period (or, if earlier, the Executive’s death),
any payments so withheld hereunder from the Executive hereunder
will be distributed to the Executive, with a payment of interest
thereon
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