Attached files
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| 8-K - ALCO STORES INC | zigsepform8k.htm |
Separation and Release
Agreement
THIS
SEPARATION AND RELEASE AGREEMENT (this "Agreement") is made as of the
9th day of March, 2010, by and between Lawrence J. Zigerelli (the "Executive") and Duckwall-Alco
Stores, Inc., a Kansas corporation (the "Company").
WHEREAS,
the Company and Executive are parties to an Employment Agreement dated July 1,
2008 (the "Employment Agreement");
WHEREAS,
the Executive has resigned his employment with the Company;
WHEREAS,
the Company has agreed to pay the Executive certain amounts, subject to the
execution of this Agreement.
NOW
THEREFORE, in consideration of these premises and the mutual promises contained
herein, and intending to be legally bound hereby, the parties agree as
follows:
1.1. The
Executive acknowledges that: (i) the payments set forth in this Agreement
constitute full settlement of all of his rights under the Employment Agreement,
(ii) he has no entitlement under any other severance or similar arrangement
maintained by the Company, and (iii) except as otherwise provided specifically
in this Agreement, the Company does not and will not have any other liability or
obligation to the Executive. The Executive further acknowledges that, in the
absence of his execution of this Agreement, the benefits and payments specified
herein would not otherwise be due to him.
1.2. The
Company agrees to pay Executive the sum of One Hundred Twenty-Five Thousand
Dollars ($125,000.00), less applicable taxes. Said sum will be paid
to Executive in twenty-four (24) equal payments over a twelve (12) month period
and pursuant to the Company’s regular payroll schedule. The first
payment under this Paragraph 1.2 shall not be made until after the expiration of
the seven (7) day revocation period set forth in Paragraph 6 of this
Agreement.
1.3. Should
Executive timely elect continuation of his health care coverage pursuant to
COBRA, the Company agrees to reimburse Executive, on a monthly basis, for a
maximum of six (6) months of Executive’s COBRA premiums. To receive
said reimbursements, each month Executive shall submit to the Company
documentation which reflects his COBRA continuation coverage.
1.4. Company
agrees that it shall amend Executive’s stock option award agreements and related
plans to permit net exercise of vested options by Executive.
2. Release and Covenant Not to
Sue.
2.1. The
Executive, his heirs and representatives release, waive and forever discharge
the Company, its predecessors and successors, assigns, stockholders,
subsidiaries, parents, affiliates, officers, directors, trustees, current and
former employees, agents and attorneys, past and present and in their respective
capacities as such (the Company and each such person or entity is each referred
to as a "Released
Person") from all pending or potential claims, counts, causes of action
and demands of any kind whatsoever or nature for money or anything else, whether
such claims are known or unknown, that arose prior to the Executive's signing
this Agreement or that relate in any way to the Executive's employment or his
separation from employment with the Company. This release includes, but is not
limited to, any and all claims of race discrimination, sexual discrimination,
national origin discrimination, religious discrimination, disability
discrimination, age discrimination and unlawful retaliation and any and all
claims under the following: Title VII of the Civil Rights Act of 1964, as
amended, 42 U.S.C. § 2000e et seq.; Civil Rights Act of 1866, 42 U.S.C. § 1981
et seq.; the Family and Medical Leave Act, as amended, 29 U.S.C. § 2601, et
seq.; the Americans with Disabilities Act, as amended, 42 U.S.C. § 12101, et
seq.; the Age Discrimination in Employment Act, as amended by the Older Workers
Benefit Protection Act, 29 U.S.C. § 621, et seq.; Kansas Act Against
Discrimination, Chapter 44, Art. 10, K.S.A.; the Employee Retirement Income
Security Act of 1974, as amended, 29 U.S.C. § 1001, et seq.; the Rehabilitation
Act of 1973, 29 U.S.C. § 706, et seq.; any state, municipal and other local
anti-discrimination statutes; any and all claims for alleged breach of an
express or implied contract; any and all tort claims including, but not limited
to, alleged retaliation for assertion of workers' compensation rights; any and
all claims under workers' compensation law; and any and all claims for
attorney's fees.
2.2. The
Executive expressly represents that he has not filed a lawsuit or initiated any
other administrative proceeding against a Released Person and that he has not
assigned any claim against a Released Person. The Executive further promises not
to initiate a lawsuit or to bring any other claim against any Released Person
arising out of or in any way related to the Executive's employment by the
Company or the resignation of that employment. This Agreement will not prevent
the Executive from filing a charge with the Equal Employment Opportunity
Commission (or similar state agency) or participating in any investigation
conducted by the Equal Employment Opportunity Commission (or similar state
agency); provided, however, that any claims by the Executive for
personal relief in connection with such a charge or investigation
(such as reinstatement or monetary damages) would be barred. In addition, this
release shall not affect the Executive's rights under the Older Workers Benefit
Protection Act to have a judicial determination of the validity of this release
and waiver.
2.3. The
foregoing will not be deemed to release the Company from (a) claims solely to
enforce this Agreement, (b) claims for indemnification under the
Company's By-Laws and/or any applicable indemnification agreements, and/or (c)
claims to continue health care coverage under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended or similar state law, and/or (d) claims
that cannot, as a matter of law, be waived. The foregoing will not be
deemed to release any person or entity from claims arising after the date of
this Agreement.
2.4. The
Executive agrees that, effective as of the date of this Agreement, no further
vesting of any stock option, restricted stock award, restricted stock unit,
stock appreciation right, or other equity based compensation shall occur,
whether by virtue of the Executive’s resignation from employment, actual or
potential change of control of the Company, or otherwise.
3. Restrictive Covenants and
Confidentiality. The Executive
acknowledges and Company agrees that the restrictive covenants contained in
Sections 7 and 8 of the Employment Agreement (the "Restrictive Covenants") shall
not survive the Executive's resignation from employment; provided, however, that
covenants between the parties concerning confidentiality and non-disclosure
shall remain in full force and effect to the extent that the covenants protect
confidentiality and prohibit specific disclosures.
4. Return of Company
Property. The Executive
represents and warrants that he has returned all property belonging to the
Company, including, but not limited to, all keys, access cards, office
equipment, computers, cellular telephones, notebooks, documents, records, files,
written materials, electronic information, credit cards bearing the Company's
name, and other Company property (originals or copies in whatever form) in the
Executive's possession or under the Executive's control.
5. Cooperation. The Executive
further agrees that, subject to reimbursement of his reasonable expenses, he
will cooperate fully with the Company and its counsel with respect to any matter
(including litigation, investigations, or governmental proceedings) in which the
Executive was in any way involved during his employment with the Company;
provided that such cooperation shall not unreasonably interfere with Executive's
employment with another employer after resignation of his employment with the
Company. The Executive shall render such cooperation in a timely manner on
reasonable notice from the Company.
6. Rescission
Right. The Executive expressly acknowledges and recites that
(a) he has read and understands the terms of this Agreement in its entirety, (b)
he has entered into this Agreement knowingly and voluntarily, without any duress
or coercion; (c) he has been advised orally and is hereby advised in writing to
consult with an attorney with respect to this Agreement before signing it; (d)
he was provided twenty-one (21) calendar days after receipt of the Agreement
to consider its terms before signing it; and (e) he is provided seven
(7) calendar days from the date of signing to terminate and revoke this
Agreement, in which case this Agreement shall be unenforceable, null and void.
The Executive may revoke this Agreement during those seven (7) days by providing
written notice of revocation to the Company.
7. Non-Disparagement and
Communication. Executive agrees that he will not make
statements or representations, or otherwise communicate, directly or indirectly,
in writing, orally, or otherwise, or take any action which may, directly or
indirectly, disparage or defame the Company, or any subsidiary or affiliate, or
defame its respective officers, directors, employees, or advisors, or their
business or reputation. Executive further agrees that he shall have
no contact or intentional communications regarding the Company, for a period of
twelve (12) months, with the Company’s stock analysts, shareholders, employees
or vendors, with Jim Hyde, or with any representative or affiliate of ACON Funds
Management LLC, Everbright Development Overseas Ltd., Luichi Group International
Ltd, Sun Capital Partners Group V, LLC, Pamida Brands Holding, LLC, William
Blair & Company, L.L.C., Peter J. Solomon Company, L.P., or any potential
buyer of or investor in the Company or with the media, or with any candidate for
employment with the Company that Executive had knowledge of or in any way
becomes aware of their candidacy for employment with the Company. If
Executive is contacted by any of these entities or individuals he is allowed to
state, “I am not at liberty to discuss the Company at this
time.” Should Executive breach any part of this Paragraph 7: (i) all
remaining payments under paragraph 1.2 shall cease, (ii) Executive shall
immediately be obligated to return any payments previously made to him under
Paragraph 1.2, and (iii) Executive shall be liable to the Company in the sum of
$100,000.00 for each occurrence that he communicates regarding the Company with
the listed individuals or entities.
7.1. Should it
be necessary for Executive to communicate with the Company regarding any matter
encompassed by this Agreement or other matter relating to the Company, it shall
not be a violation of Paragraph 7.1 if Executive limits such contact and
communication to Donny Johnson. Executive Vice President and Chief Financial
Officer.
8. Miscellaneous.
8.1. No Admission of
Liability. This Agreement is not to be construed as an
admission of any violation of any federal, state or local statute, ordinance or
regulation or of any duty owed by the Company to the Executive. There
have been no such violations, and the Company specifically denies any such
violations.
8.2. No Reinstatement. The
Executive agrees that he will not without the consent of the Company apply for
reinstatement with the Company or seek in any way to be reinstated, re-employed
or hired by the Company in the future.
8.3. Successors and
Assigns. This Agreement shall inure to the benefit of and be
binding upon the Company and the Executive and their respective successors,
permitted assigns, executors, administrators and heirs. The Executive may not
make any assignment of this Agreement or any interest herein, by operation of
law or otherwise. The Company may assign this Agreement to any successor to all
or substantially all of its assets and business by means of
liquidation, dissolution, merger, consolidation, transfer of assets, or
otherwise.
8.4. Severability. Whenever
possible, each provision of this Agreement will be interpreted in such manner as
to be effective and valid under applicable law. However, if any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect, such invalidity, illegality or unenforceability will not affect any
other provision, and this Agreement will be reformed, construed and enforced as
though the invalid, illegal or unenforceable provision had never been herein
contained.
8.5. Entire Agreement;
Amendments. Except as otherwise provided herein, this
Agreement contains the entire agreement and understanding of the parties hereto
relating to the subject matter hereof, and merges and supersedes all prior
and contemporaneous discussions, agreements and understandings of
every nature relating to the subject matter hereof. This Agreement may not be
changed or modified, except by an agreement in writing signed by each of the
parties hereto.
8.6. Governing Law. This
Agreement shall be governed by, and enforced in accordance with, the laws of the
State of Kansas, without regard to the application of the principles of
conflicts of laws.
8.7. Counterparts and
Facsimiles. This Agreement may be executed, including execution by
facsimile signature, in multiple counterparts, each of which shall be deemed an
original, and all of which together shall be deemed to be one and the same
instrument.
[Signature
Page to Follow]
IN
WITNESS WHEREOF, the Company has caused this Agreement to be executed by its
duly authorized officer, and the Executive has executed this Agreement, in each
case as of the date first above written.
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EMPLOYEE:
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/s/ Lawrence J.
Zigerelli
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Lawrence
J. Zigerelli
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COMPANY:
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DUCKWALL-ALCO
STORES, INC.
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By: /s/ Royce
Winsten
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Its: Chairman of the
Board
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Date: March 11,
2010
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