EXHIBIT 10.9
EMPLOYMENT AGREEMENT
DATED AS OF APRIL 5, 2005
BETWEEN ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ AND THE TJX COMPANIES, INC.
INDEX PAGE
----- ----
1. EFFECTIVE DATE; TERM OF AGREEMENT.................................... 1
2. SCOPE OF EMPLOYMENT.................................................. 1
3. COMPENSATION AND BENEFITS............................................ 2
4. TERMINATION OF EMPLOYMENT; IN GENERAL................................ 3
5. BENEFITS UPON NON-VOLUNTARY TERMINATION OF EMPLOYMENT
OR UPON EXPIRATION OF THE AGREEMENT.................................. 3
6. OTHER TERMINATION; VIOLATION OF CERTAIN AGREEMENTS................... 6
7. BENEFITS UPON CHANGE IN CONTROL...................................... 6
8. AGREEMENT NOT TO SOLICIT OR COMPETE.................................. 6
9. ASSIGNMENT........................................................... 8
10. NOTICES.............................................................. 8
11. WITHHOLDING; CERTAIN TAX MATTERS..................................... 8
12. GOVERNING LAW........................................................ 8
13. ARBITRATION.......................................................... 8
14. ENTIRE AGREEMENT..................................................... 9
EXHIBIT A Certain Definitions........................................... A-1
EXHIBIT B Definition of "Change of Control"............................. B-1
EXHIBIT C Change of Control Benefits.................................... C-2
-i-
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
EMPLOYMENT AGREEMENT
AGREEMENT dated as of April 5, 2005 between ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ("Executive")
and The TJX Companies, Inc., a Delaware corporation whose principal office is in
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Company").
RECITALS
The Company and Executive intend that Executive shall serve the Company as
Senior Executive Vice President and Chief Financial Officer on the terms set
forth below and, to that end, deem it desirable and appropriate to enter into
this Agreement.
AGREEMENT
The parties hereto, in consideration of the mutual agreements hereinafter
contained, agree as follows:
1. EFFECTIVE DATE; TERM OF AGREEMENT. This Agreement shall become effective
as of April 5, 2005 (the "Effective Date"). Executive's employment shall
continue on the terms provided herein until April 4, 2008 (the "End Date"),
subject to earlier termination as provided herein (such period of employment
hereinafter called the "Employment Period").
2. SCOPE OF EMPLOYMENT.
(a) Nature of Services. Executive shall diligently perform the duties and
responsibilities of Senior Executive Vice President and Chief Financial Officer
and such additional executive duties and responsibilities as shall from time to
time be assigned to him by the Chief Executive Officer.
(b) Extent of Services. Except for illnesses and vacation periods,
Executive shall devote substantially all his working time and attention and his
best efforts to the performance of his duties and responsibilities under this
Agreement. However, Executive may (i) make any passive investments where he is
not obligated or required to, and shall not in fact, devote any managerial
efforts, (ii) participate in charitable or community activities or in trade or
professional organizations, or (iii) subject to Board approval (which approval
shall not be unreasonably withheld or withdrawn), hold directorships in public
companies, except only that the Board shall have the right to limit such
services as a director or such participation whenever the Board shall believe
that the time
spent on such activities infringes in any material respect upon the time
required by Executive for the performance of his duties under this Agreement or
is otherwise incompatible with those duties.
3. COMPENSATION AND BENEFITS.
(a) Base Salary. Executive shall be paid a base salary at the rate
hereinafter specified, such Base Salary to be paid in the same manner and at the
same times as the Company shall pay base salary to other executive employees.
The annual rate at which Executive's Base Salary shall be paid shall be the
annual base salary rate at which he was being paid as of January 1, 2005 (the
"starting rate") or such other annual rate (not less than the starting rate) as
the Board may determine after Board review not less frequently than annually.
(b) Existing Awards. Reference is made to outstanding awards of stock
options and of performance-based restricted stock made prior to the Effective
Date under the Company's Stock Incentive Plan (including any successor, the
"Stock Incentive Plan"), to the award opportunity granted to Executive for FYE
2005 under the Company's Management Incentive Plan ("MIP") and to the award
opportunity granted to Executive under the Company's Long Range Performance
Incentive Plan ("LRPIP") for the FYE 2005 to 2007 cycle. In addition to the
foregoing, at such time, if any, as an LRPIP payout is made with respect to
other LRPIP participants for the FYE 2003 to 2005 cycle, the Company has
committed to pay to Executive, if he is then still employed by the Company, an
amount equal to one third of the applicable percentage (including zero percent,
if applicable) multiplied by Executive's annual rate of Base Salary as of the
Effective Date; and at such time, if any, as an LRPIP payout is made with
respect to other LRPIP participants for the FYE 2004 to 2006 cycle, the Company
has committed to pay to Executive, if he is then still employed by the Company,
an amount equal to two thirds of the applicable percentage (including zero
percent, if applicable) multiplied by Executive's annual rate of Base Salary as
of the Effective Date. As used in the immediately preceding sentence,
"applicable percentage" means 45% if the target established by the Committee for
the applicable cycle is met, up to 67.5% if such target is exceeded, and as
little as zero percent if such target is not met. Each of the foregoing awards
shall continue for such period or periods and in accordance with such terms as
are set out in the grant and other governing documents relating to such awards
and shall not be affected by the terms of this Agreement except as otherwise
expressly provided herein.
(c) New Stock Awards. Consistent with the terms of the Stock Incentive
Plan, Executive will be entitled to stock-based awards under the Stock Incentive
Plan at levels commensurate with his position and responsibilities.
(d) LRPIP. During the Employment Period, Executive will be eligible to
participate in annual grants under LRPIP at a level commensurate with his
position and responsibilities and subject to such terms as shall be established
by the Committee.
(e) MIP. During the Employment Period, Executive shall be eligible to
participate in annual grants under MIP at a level commensurate with his position
and responsibilities and subject to such terms as shall be established by the
Committee.
-2-
(f) Qualified Plans; Other Deferred Compensation Plans. Executive shall be
entitled during the Employment Period to participate in the Company's
tax-qualified retirement and profit-sharing plans and its nonqualified deferred
compensation plans, including the GDCP and ESP (but not including the
Supplemental Executive Retirement Plan), in each case in accordance with the
terms of the applicable plan.
(g) Policies and Fringe Benefits. Executive shall be subject to Company
policies applicable to its executives generally and shall be entitled to receive
all such fringe benefits as the Company shall from time to time make available
to other executives generally (subject to the terms of any applicable fringe
benefit plan). Without limiting the foregoing, Executive shall be entitled
during the Employment Period and thereafter to the extent provided herein to a
Level 5 leased automobile.
4. TERMINATION OF EMPLOYMENT; IN GENERAL.
(a) The Company shall have the right to end Executive's employment at any
time and for any reason, with or without Cause.
(b) The Employment Period shall terminate when Executive becomes Disabled.
In addition, if by reason of Incapacity Executive is unable to perform his
duties for at least six continuous months, upon written notice by the Company to
Executive the Employment Period will be terminated for Incapacity.
(c) Whenever the Employment Period shall terminate, Executive shall resign
all offices or other positions he shall hold with the Company and any affiliated
corporations.
5. BENEFITS UPON NON-VOLUNTARY TERMINATION OF EMPLOYMENT OR UPON EXPIRATION
OF THE AGREEMENT.
(a) Certain Terminations Prior to the End Date. If the Employment Period
shall have terminated prior to the End Date by reason of (i) death, Disability
or Incapacity of Executive, (ii) termination by the Company for any reason other
than Cause or (iii) termination by Executive in the event that (A) Executive is
required to report other than to the Chief Executive Officer, or (B) Executive
is relocated more than forty (40) miles from the current corporate headquarters
of the Company, in either case without his prior written consent (a
"Constructive Termination"), then all compensation and benefits for Executive
shall be as follows:
(i) For the longer of one year following the Date of Termination or
the period commencing on the Date of Termination and ending on the End Date
(such one-year or other period being herein referred to as the "termination
period"), the Company will pay to Executive or his legal representative
continued Base Salary at the rate in effect at termination of employment,
subject to the following:
(A) If Executive is eligible for long-term disability
compensation benefits under the Company's long-term disability plan,
the amount payable under this clause shall be paid at a rate equal to
the excess of (I) the rate of Base Salary in
-3-
effect at termination of employment, over (II) the long-term
disability compensation benefits for which Executive is eligible under
such plan.
(B) Payments pursuant to this clause (a)(i) shall be paid for the
first twelve (12) months of the termination period without reduction
for compensation earned from other employment or self-employment, and
shall thereafter be reduced by such compensation received by Executive
from other employment or self-employment.
(ii) Until the expiration of the termination period as defined at
(a)(i) above and subject to such minimum coverage-continuation requirements
as may be required by law, the Company will provide (except to the extent
that Executive shall obtain no less favorable coverage from another
employer or from self-employment) such medical and hospital insurance and
term life insurance for Executive and his family, comparable to the
insurance provided for executives generally, as the Company shall
determine, and upon the same terms and conditions as the same shall be
provided for other Company executives generally; provided, however, that in
no event shall such benefits or the terms and conditions thereof be less
favorable to Executive than those afforded to him as of the Date of
Termination; and further provided, that to the extent it is impossible or
impracticable to provide any such coverage to Executive under the Company's
then existing employee benefit plans or arrangements, the Company shall
arrange for alternate comparable coverage or, if such alternate coverage is
not available, shall pay to Executive the cost of such coverage, all as
reasonably determined by the Committee.
(iii) The Company will pay to Executive or his legal representative,
without offset for compensation earned from other employment or
self-employment, (A) any unpaid amounts to which Executive is entitled
under MIP for the fiscal year of the Company ended immediately prior to
Executive's termination of employment, plus (B) any unpaid amounts owing
with respect to LRPIP cycles in which Executive participated and which were
completed prior to termination, plus (C) any unpaid amounts owing under the
in-lieu-of-LRPIP award described in the second sentence of Section 3(b)
with respect to LRPIP cycles completed prior to termination. These amounts
will be paid at the same time as other awards for such prior year or cycle
are paid.
(iv) The Company will pay to Executive or his legal representative,
without offset for compensation earned from other employment or
self-employment, an amount equal to the sum of (A) Executive's MIP Target
Award, if any, for the year of termination, multiplied by a formula the
numerator of which is three hundred and sixty-five (365) plus the number of
days during such year prior to termination, and the denominator of which is
seven hundred and thirty (730), plus, (B) with respect to each LRPIP cycle
in which Executive participated and which had not ended prior to
termination of employment, 1/36 of an amount equal to Executive's LRPIP
Target Award for such cycle multiplied by the number of full months in such
cycle completed prior to termination of employment. For purposes of clause
(a)(iv)(B) above, the in-lieu-of-LRPIP award described in the second
sentence of Section 3(b) shall be treated as an LRPIP cycle in which
Executive participated and the following special rules shall apply:
-4-
(1) Executive's Target Award for such cycle shall be deemed to be 45% of
his annual rate of Base Salary as of the Effective Date, and (2) the number
of full months completed prior to termination of employment (i.e., the
number of months multiplied by 1/36) shall not include any periods prior to
February 1, 2004. The amount described in clause (a)(iv)(A) above will be
paid not later than MIP awards for the year of termination are paid. The
amount described in clause (a)(iv)(B) above, to the extent measured by the
LRPIP Target Award for any cycle, will be paid not later than the date on
which LRPIP awards for such cycle are paid or would have been paid.
(v) In addition, Executive or his legal representative shall be
entitled to the Stock Incentive Plan benefits described in Section 3(b)
(Existing Awards) and Section 3(c) (New Stock Awards), in each case in
accordance with and subject to the terms of the applicable arrangement, and
to the payment of his vested benefits under the plans described in Section
3(f) (Qualified Plans; Other Deferred Compensation Plans).
(vi) If termination occurs by reason of Incapacity or Disability,
Executive shall also be entitled to such compensation, if any, as is
payable pursuant to the Company's long-term disability plan. If for any
period Executive receives long-term disability compensation payments under
a long-term disability plan of the Company as well as payments under (a)(i)
above, and if the sum of such payments (the "combined salary/disability
benefit") exceeds the payment for such period to which Executive is
entitled under (a)(i) above (determined without regard to paragraph (A)
thereof), he shall promptly pay such excess in reimbursement to the
Company; provided, that in no event shall application of this sentence
result in reduction of Executive's combined salary/disability benefit below
the level of long-term disability compensation payments to which Executive
is entitled under the long-term disability plan or plans of the Company.
(vii) If termination occurs by reason of death, Incapacity or
Disability, Executive shall also be entitled to an amount equal to
Executive's MIP Target Award for the year of termination, without
proration. This amount will be paid at the same time as the amount payable
under paragraph (iv) above.
(viii) Except as expressly set forth above or as required by law,
Executive shall not be entitled to continue participation during the
termination period in any employee benefit or fringe benefit plan, except
that during the termination period the Company shall continue to provide
the Executive with an automobile or automobile allowance.
(b) Terminations on or after the End Date. Unless earlier terminated or
except as otherwise mutually agreed by Executive and the Company, Executive's
employment with the Company shall terminate on the End Date. Unless the Company
in connection with such termination shall offer to Executive continued service
in a position acceptable to Executive and upon mutually and reasonably agreeable
terms, Executive shall be treated as having terminated under Section 5(a) on the
day immediately preceding the End Date and shall be entitled to the pay and
benefits described therein. If the Company in connection with such termination
offers to Executive continued service in a position acceptable to Executive and
upon mutually and reasonably agreeable terms, and Executive declines such
service, he shall be treated for all
-5-
purposes of this Agreement as having terminated his employment voluntarily on
the End Date and he shall be entitled only to those benefits to which he would
be entitled under Section 6(a) ("Voluntary termination of employment"). For
purposes of the two preceding sentences, "service in a position acceptable to
Executive" shall be deemed to mean service as Senior Executive Vice President
and Chief Financial Officer or service in such other position, if any, as may be
acceptable to Executive.
6. OTHER TERMINATION; VIOLATION OF CERTAIN AGREEMENTS.
(a) Voluntary termination of employment. If Executive terminates his
employment voluntarily, Executive or his legal representative shall be
entitled (in each case in accordance with and subject to the terms of the
applicable arrangement) to any Stock Incentive Plan benefits described in
Section 3(b) (Existing Awards) or Section 3(c) (New Stock Awards) and to
any vested benefits under the plans described in Section 3(f) (Qualified
Plan; Other Deferred Compensation Plans). In addition, the Company will pay
to Executive or his legal representative any unpaid amounts to which
Executive is entitled under MIP for the fiscal year of the Company ended
immediately prior to Executive's termination of employment, plus any unpaid
amounts owing with respect to LRPIP cycles in which Executive participated
and which were completed prior to termination, in each case at the same
time as other awards for such prior year or cycle are paid. No other
benefits shall be paid under this Agreement upon a voluntary termination of
employment.
(b) Termination for Cause; violation of certain agreements. If the
Company should end Executive's employment for Cause, or, notwithstanding
Section 5 and Section 6(a) above, if Executive should violate the protected
persons or noncompetition provisions of Section 8, all compensation and
benefits otherwise payable pursuant to this Agreement shall cease, other
than (x) such vested amounts as are credited to Executive's account (but
not received) under GDCP and ESP in accordance with the terms of those
programs; and (y) Stock Incentive Plan benefits, if any, to which Executive
may be entitled (in each case in accordance with and subject to the terms
of the applicable arrangement) under Section 3(b) (Existing Awards) or
Section 3(c) (New Stock Awards) and any vested benefits to which the
Executive is entitled under the Company's tax-qualified plans. The Company
does not waive any rights it may have for damages for injunctive relief.
7. BENEFITS UPON CHANGE IN CONTROL. Notwithstanding any other provision of
this Agreement, in the event of a Change of Control, the determination and
payment of any benefits payable thereafter with respect to Executive shall be
governed exclusively by the provisions of Exhibit C.
8. AGREEMENT NOT TO SOLICIT OR COMPETE.
(a) Upon the termination of employment at any time, then for a period of
two years after the termination of the Employment Period, Executive shall not
under any circumstances employ, solicit the employment of, or accept unsolicited
the services of, any "protected person" or
-6-
recommend the employment of any "protected person" to any other business
organization. A "protected person" shall be a person known by Executive to be
employed by the Company or its Subsidiaries or to have been employed by Company
or its Subsidiaries within six months prior to the commencement of conversations
with such person with respect to employment.
As to (i) each "protected person" to whom the foregoing applies, (ii) each
subcategory of "protected person" as defined above, (iii) each limitation on (A)
employment, (B) solicitation and (C) unsolicited acceptance of services, of each
"protected person" and (iv) each month of the period during which the provisions
of this subsection (a) apply to each of the foregoing, the provisions set forth
in this subsection (a) are deemed to be separate and independent agreements and
in the event of unenforceability of any such agreement, such unenforceable
agreement shall be deemed automatically deleted from the provisions hereof and
such deletion shall not affect the enforceability of any other provision of this
subsection (a) or any other term of this Agreement.
(b) During the course of his employment, Executive will have learned many
trade secrets of the Company and its Subsidiaries and will have access to
confidential information and business plans for the Company and its
Subsidiaries. Therefore, upon termination of the Employment Period on the End
Date or if Executive should end his employment voluntarily at any time,
including by reason of retirement or disability, or if the Company should end
Executive's employment at any time for Cause, then for a period of two years
thereafter, Executive will not engage, either as a principal, employee, partner,
consultant or investor (other than a less-than-1% stock interest in a
corporation), in a business which is a competitor of the Company and its
Subsidiaries. A business shall be deemed a competitor of the Company and its
Subsidiaries if and only (i) if it shall then be so regarded by retailers
generally or (ii) if it shall operate an off-price family apparel and/or home
fashions or furnishings store within ten (10) miles of any "then existing or
proposed Company store" or (iii) if it shall operate an on-line, "e-commerce" or
other internet-based off-price family apparel and/or home fashions or
furnishings business; provided, that a business shall be deemed a competitor of
the Company and its Subsidiaries under clause (iii) only if the Company or a
Subsidiary is then also operating an on-line, "e-commerce" or other
internet-based off-price family apparel and/or home fashions or furnishings
business; and further provided, that a business shall be deemed a competitor of
the Company and its Subsidiaries by engaging in an off-price family apparel
and/or home fashions or furnishings business only if the Company or a Subsidiary
is then also engaged in such a business. The term "then existing or proposed
Company store" in the previous sentence shall refer to any such store that is,
at the time of termination of the Employment Period, operated by the Company or
any Subsidiary or under lease for operation as aforesaid. Nothing herein shall
restrict the right of Executive to engage in a business that operates a
conventional or full ▇▇▇▇-up department store. Executive agrees that if, at any
time, pursuant to action of any court, administrative or governmental body or
other arbitral tribunal, the operation of any part of this paragraph shall be
determined to be unlawful or otherwise unenforceable, then the coverage of this
paragraph shall be deemed to be restricted as to duration, geographical scope or
otherwise, as the case may be, to the extent, and only to the extent, necessary
to make this paragraph lawful and enforceable in the particular jurisdiction in
which such determination is made.
(c) If the Employment Period terminates, Executive agrees (i) to notify the
Company immediately upon his securing employment or becoming self-employed
during any period when
Executive's compensation from the Company shall be subject to reduction or his
benefits provided by the Company shall be subject to termination as provided in
Section 6 and (ii) to furnish to the Company written evidence of his
compensation earned from any such employment or self-employment as the Company
shall from time to time request. In addition, upon termination of the Employment
Period for any reason other than the death of Executive, Executive shall
immediately return all written trade secrets, confidential information and
business plans of the Company and shall execute a certificate certifying that he
has returned all such items in his possession or under his control.
9. ASSIGNMENT. The rights and obligations of the Company shall enure to the
benefit of and shall be binding upon the successors and assigns of the Company.
The rights and obligations of Executive are not assignable except only that
payments payable to him after his death shall be made by devise or descent.
10. NOTICES. All notices and other communications required hereunder shall
be in writing and shall be given by mailing the same by certified or registered
mail, return receipt requested, postage prepaid. If sent to the Company the same
shall be mailed to the Company at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: Chairman of the Executive Compensation Committee, or other
such address as the Company may hereafter designate by notice to Executive; and
if sent to the Executive, the same shall be mailed to Executive at his address
set forth in the records of the Company or at such other address as Executive
may hereafter designate by notice to the Company.
11. WITHHOLDING; CERTAIN TAX MATTERS. Anything to the contrary
notwithstanding, (a) all payments required to be made by the Company hereunder
to Executive shall be subject to the withholding of such amounts, if any,
relating to tax and other payroll deductions as the Company may reasonably
determine it should withhold pursuant to any applicable law or regulation, and
(b) to the extent any payment hereunder shall be required to be delayed until
six months following separation from service to comply with the "specified
employee" rules of Section 409A of the Code, it shall be so delayed (but not
more than is required to comply with such rules).
12. GOVERNING LAW. This Agreement and the rights and obligations of the
parties hereunder shall be governed by the laws of the Commonwealth of
Massachusetts.
13. ARBITRATION. In the event that there is any claim or dispute arising
out of or relating to this Agreement, or the breach thereof, and the parties
hereto shall not have resolved such claim or dispute within sixty (60) days
after written notice from one party to the other setting forth the nature of
such claim or dispute, then such claim or dispute shall be settled exclusively
by binding arbitration in Boston, Massachusetts in accordance with the Rules
Governing Resolutions of Employment Disputes of the American Arbitration
Association by an arbitrator mutually agreed upon by the parties hereto or, in
the absence of such agreement, by an arbitrator selected according to such
Rules. Notwithstanding the foregoing, if either the Company or Executive shall
request, such arbitration shall be conducted by a panel of three arbitrators,
one selected by the Company, one selected by Executive and the third selected by
agreement of the first two, or, in the absence of such agreement, in accordance
with such Rules.
-8-
Judgment upon the award rendered by such arbitrator(s) shall be entered in any
Court having jurisdiction thereof upon the application of either party.
14. ENTIRE AGREEMENT. This Agreement, including Exhibits, represents the
entire agreement between the parties relating to the terms of Executive's
employment by the Company and supersedes all prior written or oral agreements
between them.
/S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Executive
THE TJX COMPANIES, INC.
By /S/ ▇▇▇▇▇▇ ▇. English
---------------------------------
-9-
EXHIBIT A
Certain Definitions
(a) "Base Salary" means, for any period, the amount described in
Section 3(a).
(b) "Board" means the Board of Directors of the Company.
(c) "Committee" means the Executive Compensation Committee of the Board.
(d) "Cause" means dishonesty by Executive in the performance of his duties,
conviction of a felony (other than a conviction arising solely under a statutory
provision imposing criminal liability upon Executive on a per se basis due to
the Company offices held by Executive, so long as any act or omission of
Executive with respect to such matter was not taken or omitted in contravention
of any applicable policy or directive of the Board), gross neglect of duties
(other than as a result of Incapacity, Disability or death), or conflict of
interest which conflict shall continue for thirty (30) days after the Company
gives written notice to Executive requesting the cessation of such conflict.
In respect of any termination during a Standstill Period, Executive shall
not be deemed to have been terminated for Cause until the later to occur of (i)
the 30th day after notice of termination is given and (ii) the delivery to
Executive of a copy of a resolution duly adopted by the affirmative vote of not
less than a majority of the Company's directors at a meeting called and held for
that purpose (after reasonable notice to Executive), and at which Executive
together with his counsel was given an opportunity to be heard, finding that the
Executive was guilty of conduct described in the definition of "Cause" above,
and specifying the particulars thereof in detail; provided, however, that the
Company may suspend Executive and withhold payment of his Base Salary from the
date that notice of termination is given until the earliest to occur of (A)
termination of Executive for Cause effected in accordance with the foregoing
procedures (in which case Executive shall not be entitled to his Base Salary for
such period), (B) a determination by a majority of the Company's directors that
Executive was not guilty of the conduct described in the definition of "Cause"
effected in accordance with the foregoing procedures (in which case Executive
shall be reinstated and paid any of his previously unpaid Base Salary for such
period), or (C) ninety (90) days after notice of termination is given (in which
case Executive shall then be reinstated and paid any of his previously unpaid
Base Salary for such period). If Base Salary is withheld and then paid pursuant
to clause (B) or (C) of the preceding sentence, the amount thereof shall be
accompanied by simple interest, calculated on a daily basis, at a rate per annum
equal to the prime or base lending rate, as in effect at the time, of the
Company's principal commercial bank.
(e) "Change of Control" has the meaning given it in Exhibit B.
A-1
(f) "Change of Control Termination" means the termination of Executive's
employment during a Standstill Period (1) by the Company other than for Cause,
or (2) by Executive for good reason, or (3) by reason of death, Incapacity or
Disability.
For purposes of this definition, termination for "good reason" shall mean
the voluntary termination by Executive of his employment (A) within one hundred
and twenty (120) days after the occurrence without Executive's express written
consent of any one of the events described in clauses (I), (II), (III), (IV),
(V) or (VI) below, provided, that Executive gives notice to the Company at least
thirty (30) days in advance requesting that the pertinent situation described
therein be remedied, and the situation remains unremedied upon expiration of
such 30-day period; (B) within one hundred and twenty (120) days after the
occurrence without Executive's express written consent of the event described in
clause (VII), provided, that Executive gives notice to the Company at least
thirty (30) days in advance of his intent to terminate his employment in respect
of such event; or (C) under the circumstances described in clause (VIII) below,
provided, that Executive gives notice to the Company at least thirty (30) days
in advance:
(I) the assignment to him of any duties inconsistent with his
positions, duties, responsibilities, reporting requirements, and
status with the Company immediately prior to the Change of
Control, or any removal of Executive from or any failure to
reelect him to such positions, except in connection with the
termination of Executive's employment by the Company for Cause or
by Executive other than for good reason, or any other action by
the Company which results in a diminishment in such position,
authority, duties or responsibilities, other than an insubstantial
and inadvertent action which is remedied by the Company promptly
after receipt of notice thereof given by Executive; or
(II) if Executive's rate of Base Salary for any fiscal year is less
than 100 percent of the rate of Base Salary paid to Executive in
the completed fiscal year immediately preceding the Change of
Control or if Executive's total cash compensation opportunities,
including salary and incentives, for any fiscal year are less than
100% of the total cash compensation opportunities made available
to Executive in the completed fiscal year immediately preceding
the Change of Control; or
(III) the failure of the Company to continue in effect any benefits or
perquisites, or any pension, life insurance, medical insurance or
disability plan in which Executive was participating immediately
prior to the Change of Control unless the Company provides
Executive with a plan or plans that provide substantially similar
benefits, or the taking of any action by the Company that would
adversely affect Executive's benefits under any of such plans or
deprive Executive of any material fringe benefit enjoyed by
Executive immediately prior to the Change of Control; or
A-2
(IV) any purported termination of Executive's employment by the Company
for Cause during a Standstill Period which is not effected in
compliance with paragraph (d) above; or
(V) any relocation of Executive of more than forty (40) miles from the
place where Executive was located at the time of the Change of
Control; or
(VI) any other breach by the Company of any provision of this
Agreement; or
(VII) the Company sells or otherwise disposes of, in one transaction or
a series of related transactions, assets or earning power
aggregating more than 30% of the assets (taken at asset value as
stated on the books of the Company determined in accordance with
generally accepted accounting principles consistently applied) or
earning power of the Company (on an individual basis) or the
Company and its Subsidiaries (on a consolidated basis) to any
other Person or Persons (as those terms are defined in Exhibit B);
or
(VIII) the voluntary termination by Executive of his employment at any
time within one year after the Change of Control. Notwithstanding
the foregoing, the Board may expressly waive the application of
this clause (VIII) if it waives the applicability of substantially
similar provisions with respect to all persons with whom the
Company has a written severance agreement (or may condition its
application on any additional requirements or employee agreements
which the Board shall in its discretion deem appropriate in the
circumstances). The determination of whether to waive or impose
conditions on the application of this clause (VIII) shall be
within the complete discretion of the Board but shall be made
prior to the Change of Control.
(g) "Code" means the Internal Revenue Code of 1986, as from time to time
amended and in effect.
(h) "Date of Termination" means the date on which Executive's employment
terminates.
(i) "Disability" has the meaning given it in the Company's long-term
disability plan. Executive's employment shall be deemed to be terminated for
Disability on the date on which Executive is entitled to receive long-term
disability compensation pursuant to such long-term disability plan.
(j) "End Date" has the meaning set forth in Section 1 of the Agreement.
(k) "GDCP" means the Company's General Deferred Compensation Plan, or, if
the General Deferred Compensation Plan is no longer maintained by the Company, a
nonqualified deferred compensation plan (other than the ESP) or arrangement the
terms of which are not less favorable to Executive than the terms of the General
Deferred Compensation Plan as in effect on the Effective Date.
A-3
(l) "ESP" means the Company's Executive Savings Plan.
(m) "Incapacity" means a disability (other than Disability within the
meaning of (i) above) or other impairment of health that renders Executive
unable to perform his duties to the reasonable satisfaction of the Committee.
(n) "LRPIP" has the meaning set forth in Section 3(b) of the Agreement.
(o) "MIP" has the meaning set forth in Section 3(b) of the Agreement.
(p) "Standstill Period" means the period commencing on the date of a Change
of Control and continuing until the close of business on the earlier of the day
immediately preceding the End Date or the last business day of the 24th calendar
month following such Change of Control.
(q) "Stock" means the common stock, $1.00 par value, of the Company.
(r) "Stock Incentive Plan" has the meaning set forth in Section 3(b)of the
Agreement.
(s) "Subsidiary" means any corporation in which the Company owns, directly
or indirectly, 50% or more of the total combined voting power of all classes of
stock.
A-4
EXHIBIT B
Definition of "Change of Control"
"Change of Control" shall mean the occurrence of any one of the following
events:
(a) there occurs a change of control of the Company of a nature that
would be required to be reported in response to Item 1(a) of the Current
Report on Form 8-K pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 (the "Exchange Act") or in any other filing under the
Exchange Act; provided, however, that no transaction shall be deemed to be
a Change of Control (i) if the person or each member of a group of persons
acquiring control is excluded from the definition of the term "Person"
hereunder or (ii) unless the Committee shall otherwise determine prior to
such occurrence, if Executive or an Executive Related Party is the Person
or a member of a group constituting the Person acquiring control; or
(b) any Person other than the Company, any wholly-owned subsidiary of
the Company, or any employee benefit plan of the Company or such a
subsidiary becomes the owner of 20% or more of the Company's Common Stock
and thereafter individuals who were not directors of the Company prior to
the date such Person became a 20% owner are elected as directors pursuant
to an arrangement or understanding with, or upon the request of or
nomination by, such Person and constitute at least 1/4 of the Company's
Board of Directors; provided, however, that unless the Committee shall
otherwise determine prior to the acquisition of such 20% ownership, such
acquisition of ownership shall not constitute a Change of Control if
Executive or an Executive Related Party is the Person or a member of a
group constituting the Person acquiring such ownership; or
(c) there occurs any solicitation or series of solicitations of proxies
by or on behalf of any Person other than the Company's Board of Directors
and thereafter individuals who were not directors of the Company prior to
the commencement of such solicitation or series of solicitations are
elected as directors pursuant to an arrangement or understanding with, or
upon the request of or nomination by, such Person and constitute at least
1/4 of the Company's Board of Directors; or
(d) the Company executes an agreement of acquisition, merger or
consolidation which contemplates that (i) after the effective date provided
for in the agreement, all or substantially all of the business and/or
assets of the Company shall be owned, leased or otherwise controlled by
another Person and (ii) individuals who are directors of the Company when
such agreement is executed shall not constitute a majority of the board of
directors of the survivor or successor entity immediately after the
effective date provided for in such agreement; provided, however, that
unless otherwise determined by the Committee, no transaction shall
constitute a Change of Control if, immediately after such transaction,
Executive or any Executive Related Party shall own equity securities of any
surviving corporation ("Surviving Entity") having a fair value as a
percentage of the fair value of the equity securities of such Surviving
Entity greater than 125% of the fair value
B-1
of the equity securities of the Company owned by Executive and any
Executive Related Party immediately prior to such transaction, expressed as
a percentage of the fair value of all equity securities of the Company
immediately prior to such transaction (for purposes of this paragraph
ownership of equity securities shall be determined in the same manner as
ownership of Common Stock); and provided, further, that, for purposes of
this paragraph (d), if such agreement requires as a condition precedent
approval by the Company's shareholders of the agreement or transaction, a
Change of Control shall not be deemed to have taken place unless and until
such approval is secured (but upon any such approval, a Change of Control
shall be deemed to have occurred on the date of execution of such
agreement).
In addition, for purposes of this Exhibit B the following terms have the
meanings set forth below:
"Common Stock" shall mean the then outstanding Common Stock of the Company
plus, for purposes of determining the stock ownership of any Person, the number
of unissued shares of Common Stock which such Person has the right to acquire
(whether such right is exercisable immediately or only after the passage of
time) upon the exercise of conversion rights, exchange rights, warrants or
options or otherwise. Notwithstanding the foregoing, the term Common Stock shall
not include shares of Preferred Stock or convertible debt or options or warrants
to acquire shares of Common Stock (including any shares of Common Stock issued
or issuable upon the conversion or exercise thereof) to the extent that the
Board of Directors of the Company shall expressly so determine in any future
transaction or transactions.
A Person shall be deemed to be the "owner" of any Common Stock:
(i) of which such Person would be the "beneficial owner," as such term
is defined in Rule 13d-3 promulgated by the Securities and Exchange
Commission (the "Commission") under the Exchange Act, as in effect on March
1, 1989; or
(ii) of which such Person would be the "beneficial owner" for purposes
of Section 16 of the Exchange Act and the rules of the Commission
promulgated thereunder, as in effect on March 1, 1989; or
(iii) which such Person or any of its affiliates or associates (as
such terms are defined in Rule 12b-2 promulgated by the Commission under
the Exchange Act, as in effect on March 1, 1989), has the right to acquire
(whether such right is exercisable immediately or only after the passage of
time) pursuant to any agreement, arrangement or understanding or upon the
exercise of conversion rights, exchange rights, warrants or options or
otherwise.
"Person" shall have the meaning used in Section 13(d) of the Exchange Act,
as in effect on March 1, 1989.
B-2
An "Executive Related Party" shall mean any affiliate or associate of
Executive other than the Company or a majority-owned subsidiary of the Company.
The terms "affiliate" and "associate" shall have the meanings ascribed thereto
in Rule 12b-2 under the Exchange Act (the term "registrant" in the definition of
"associate" meaning, in this case, the Company).
EXHIBIT C
Change of Control Benefits
C.1. Benefits Upon a Change of Control Termination.
(a) The Company shall pay to Executive in a lump sum within thirty (30)
days following a Change of Control Termination an amount equal to (A) two times
his Base Salary for one year at the rate in effect immediately prior to the Date
of Termination or the Change of Control, whichever is higher, plus (B) the
accrued and unpaid portion of his Base Salary through the Date of Termination,
subject to the following. If Executive is eligible for long term disability
compensation benefits under the Company's long-term disability plan, the amount
payable under (A) shall be reduced by the annual long-term disability
compensation benefit for which Executive is eligible under such plan for the
two-year period over which the amount payable under (A) is measured. If for any
period Executive receives long-term disability compensation payments under a
long-term disability plan of the Company as well as payments under the first
sentence of this clause (i), and if the sum of such payments (the "combined
Change of Control/disability benefit") exceeds the payment for such period to
which Executive is entitled under the first sentence of this clause (i)
(determined without regard to the second sentence of this clause (i)), he shall
promptly pay such excess in reimbursement to the Company; provided, that in no
event shall application of this sentence result in reduction of Executive's
combined Change of Control/disability benefit below the level of long-term
disability compensation payments to which Executive is entitled under the
long-term disability plan or plans of the Company.
(b) Until the second anniversary of the Date of Termination, the Company
shall maintain in full force and effect for the continued benefit of Executive
and his family all life insurance and medical insurance plans and programs in
which Executive was entitled to participate immediately prior to the Change of
Control, provided that Executive's continued participation is possible under the
general terms and provisions of such plans and programs. In the event that
Executive is ineligible to participate in such plans or programs, the Company
shall arrange upon comparable terms to provide Executive with benefits
substantially similar to those which he is entitled to receive under such plans
and programs. Notwithstanding the foregoing, the Company's obligations hereunder
with respect to life or medical coverage or benefits shall be deemed satisfied
to the extent (but only to the extent) of any such coverage or benefits provided
by another employer.
(c) For a period of two years after the Date of Termination, the Company
shall make available to Executive the use of any automobile that was made
available to Executive prior to the Date of Termination, including ordinary
replacement thereof in accordance with the Company's automobile policy in effect
immediately prior to the Change of Control (or, in lieu of making such
automobile available, the Company may at its option pay to Executive the present
value of its cost of providing such automobile).
C-1
C.2. Incentive Benefits Upon a Change of Control. Within thirty (30) days
following a Change of Control, whether or not Executive's employment has
terminated or been terminated, the Company shall pay to the Executive, in a lump
sum, the sum of (i) and (ii), where:
(i) is the sum of (A) the "Target Award" under the Company's
Management Incentive Plan or any other annual incentive plan which is
applicable to Executive for the fiscal year in which the Change of Control
occurs, plus (B) an amount equal to such Target Award prorated for the
period of active employment during such fiscal year through the Change of
Control; and
(ii) the sum of (A) for Performance Cycles not completed prior to the
Change of Control, an amount with respect to each such cycle equal to the
maximum Award under LRPIP specified for Executive for such cycle, plus (B)
any unpaid amounts owing with respect to cycles completed prior to the
Change of Control.
C.3. Gross-Up Payment. Payments under Section C.1. and Section C.2. of this
Exhibit shall be made without regard to whether the deductibility of such
payments (or any other payments or benefits to or for the benefit of Executive)
would be limited or precluded by Section 280G of the Code ("Section 280G") and
without regard to whether such payments (or any other payments or benefits)
would subject Executive to the federal excise tax levied on certain "excess
parachute payments" under Section 4999 of the Code (the "Excise Tax"). If any
portion of the payments or benefits to or for the benefit of Executive
(including, but not limited to, payments and benefits under this Agreement but
determined without regard to this paragraph) constitutes an "excess parachute
payment" within the meaning of Section 280G (the aggregate of such payments
being hereinafter referred to as the "Excess Parachute Payments"), the Company
shall promptly pay to Executive an additional amount (the "gross-up payment")
that after reduction for all taxes (including but not limited to the Excise Tax)
with respect to such gross-up payment equals the Excise Tax with respect to the
Excess Parachute Payments; provided, that to the extent any gross-up payment
would be considered "deferred compensation" for purposes of Section 409A of the
Code, the manner and time of payment, and the provisions of this Section C.3,
shall be adjusted to the extent necessary (but only to the extent necessary) to
comply with the requirements of Section 409A with respect to such payment so
that the payment does not give rise to the interest or additional tax amounts
described at Section 409A(a)(1)(B) or Section 409A(b)(4) of the Code (the
"Section 409A penalties"); and further provided, that if, notwithstanding the
immediately preceding proviso, the gross-up payment cannot be made to conform to
the requirements of Section 409A of the Code, the amount of the gross-up payment
shall be determined without regard to any gross-up for the Section 409A
penalties. The determination as to whether Executive's payments and benefits
include Excess Parachute Payments and, if so, the amount of such payments, the
amount of any Excise Tax owed with respect thereto, and the amount of any
gross-up payment shall be made at the Company's expense by
PricewaterhouseCoopers LLP or by such other certified public accounting firm as
the Committee may designate prior to a Change of Control (the "accounting
firm"). Notwithstanding the foregoing, if the Internal Revenue Service shall
assert an Excise Tax liability that is higher than the Excise Tax (if any)
determined by the accounting firm, the
C-2
Company shall promptly augment the gross-up payment to address such higher
Excise Tax liability.
C.4. Other Benefits. In addition to the amounts described in Sections C.1.
and C.2., and C.3., Executive shall be entitled to his Stock Incentive Plan
benefits, if any, under Section 3(b) (Existing Awards) and Section 3(c) (New
Stock Awards), and to the payment of vested benefits under the plans described
in Section 3(f) (Qualified Plans; Other Deferred Compensation Plans).
C.5. Noncompetition; No Mitigation of Damages; etc.
(a) Noncompetition. Upon a Change of Control, any agreement by
Executive not to engage in competition with the Company subsequent to the
termination of his employment, whether contained in an employment contract
or other agreement, shall no longer be effective.
(b) No Duty to Mitigate Damages. Executive's benefits under this
Exhibit C shall be considered severance pay in consideration of his past
service and his continued service from the date of this Agreement, and his
entitlement thereto shall neither be governed by any duty to mitigate his
damages by seeking further employment nor offset by any compensation which
he may receive from future employment.
(c) Legal Fees and Expenses. The Company shall pay all legal fees and
expenses, including but not limited to counsel fees, stenographer fees,
printing costs, etc. reasonably incurred by Executive in contesting or
disputing that the termination of his employment during a Standstill Period
is for Cause or other than for good reason (as defined in the definition of
Change of Control Termination) or obtaining any right or benefit to which
Executive is entitled under this Agreement following a Change of Control.
Any amount payable under this Agreement that is not paid when due shall
accrue interest at the prime rate as from time to time in effect at Bank of
America, or its successor, until paid in full.
(d) Notice of Termination. During a Standstill Period, Executive's
employment may be terminated by the Company only upon thirty (30) days'
written notice to Executive.
C-3
[TJX LETTERHEAD]
▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
The TJX Companies, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Modification of Employment Agreement
Dear ▇▇. ▇▇▇▇▇▇:
Reference is made to the Employment Agreement dated as of April 5, 2005
(the "Agreement") between you and The TJX Companies, Inc. (the "Company"). The
Company proposes to modify Section 3(g) of the Agreement to replace the
reference to a leased automobile with a reference to an auto allowance and to
make a corresponding change to Section C.1(c) of Exhibit C. Section 3(g) would
be modified by deleting the second sentence thereof and amending the first
sentence thereof so that it reads: "Executive shall be subject to Company
policies applicable to its executives generally and shall be entitled to receive
an automobile allowance commensurate with his position and all such other fringe
benefits as the Company shall from time to time make available to other
executives generally (subject to the terms of any applicable fringe benefit
plan)." Section C.1(c) of Exhibit C would be modified to read: "For a period of
two years after the Date of Termination, the Company shall continue to provide
to Executive the automobile allowance that it was providing to him prior to the
Change of Control."
If you agree with the foregoing proposed modification of the Agreement,
please so indicate by signing the enclosed copy of this letter agreement and
returning it to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, whereupon Section 3(g) of the Agreement and
Section C.1(c) of Exhibit C of the Agreement will be deemed modified, effective
immediately, to read as described above and, except as so modified, effective
immediately, to read as described above and, except as so modified, the
Agreement will continue in effect in accordance with its terms. This letter
agreement shall constitute an agreement under seal.
The TJX Companies, Inc.
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
I agree to the modifications described above
to the Employment Agreement dated as of
April 5, 2005 between me and The TJX
Companies, Inc., effective as of the date
set forth below:
/S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Date: September 7, 2005
[TJX LETTERHEAD]
▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
The TJX Companies, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Modification of Employment Agreement
Dear ▇▇. ▇▇▇▇▇▇:
Reference is made to the Employment Agreement dated as of April 5, 2005 (as
subsequently amended and in effect, the "Agreement") between you and The TJX
Companies, Inc. (the "Company"). The Company proposes to amend Section 3(a) of
the Agreement ("Base Salary") by adding at the end thereof the following text:
"Notwithstanding anything to the contrary in this Agreement, however, effective
for periods commencing on or after March 13, 2006 the annual rate at which
Executive's Base Salary shall be paid shall be $585,000.00 (the "adjusted rate")
or such other annual rate (not less than the adjusted rate) as the Board may
determine after Board review not less frequently than annually."
If you agree with the foregoing proposed amendment to the Agreement, please
so indicate by signing the enclosed copy of this letter and returning it to Mr.
▇▇▇▇ ▇▇▇▇▇▇, whereupon the Agreement will be deemed amended, effective
immediately, to incorporate the change set forth above, and, except as to
amended, the Agreement will continue in effect in accordance with its terms.
This letter agreement shall constitute an agreement under seal.
THE TJX COMPANIES, INC.
By: /S/ ▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
▇▇▇▇ ▇▇▇▇▇▇, SVP, HR Administration Director
I agree to the amendment described
above to the Employment Agreement
dated as of April 5, 2005 between
me and The TJX Companies, Inc., as
previously modified, effective as
of the date set forth below:
/S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Date: 3/7/06
[TJX LETTERHEAD]
September 6, 2006
▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
The TJX Companies, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Modification of Employment Agreement
Dear ▇▇. ▇▇▇▇▇▇:
Reference is made to the Employment Agreement dated as of April 5, 2005 (as
previously amended, the "Agreement") between you and The TJX Companies, Inc.
(the "Company"). The Company proposes to make the following changes to the
Agreement:
o Replace the Recitals with the following sentence: "The Company and
Executive intend that Executive shall be employed by the Company on the
terms set forth below and, to that end, deem it desirable to enter into
this Agreement."
o Replace the text of Section 2(a) with the following sentence:
"Executive shall diligently perform such duties and responsibilities as
shall from time to time be assigned to him by the Company."
o Delete from Section 5(a)(iii) the words "(A) Executive is required to
report other than to the Chief Executive Officer, or (B)".
o Replace the last sentence of Section 5(b) with the following: "For
purposes of the two preceding sentences, "service in a position
acceptable to Executive" shall mean service in a position comparable to
the position in which Executive was serving immediately prior to the
End Date, as reasonably determined by the Board."
If you agree with the foregoing proposed modifications of the Agreement,
please so indicate by signing the enclosed copy of this letter agreement and
returning it to ▇▇▇▇ ▇▇▇▇▇▇, whereupon the Agreement will be deemed modified,
effective immediately, to read as described above and, except as so modified,
the Agreement will continue in effect in accordance with its terms. This letter
agreement shall constitute an agreement under seal.
The TJX Companies, Inc.
By: /S/ ▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------------
▇▇▇▇ ▇▇▇▇▇▇, SVP, HR Administration Director
I agree to the modifications
described above to the
Employment Agreement dated
as of April 5, 2005 between
me and The TJX Companies, Inc.,
as previously amended, effective
as of the date set forth below:
/S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Date: September 10, 2006
-2-