| Exhibit 10.1 |
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
Destination XL Group, Inc., a Delaware corporation, with its office located at 555 Turnpike Street, Canton, Massachusetts, 02021 (the “Company”), and Harvey S. Kanter (“Executive”) (collectively, the “Parties”) enter into this AMENDED AND RESTATED EMPLOYMENT AGREEMENT (“Agreement”) dated as of April 1, 2022 and effective as of the Commencement Date (as defined below) as follows:
The Company hereby agrees to continue to employ Executive, and Executive hereby agrees to continue to be employed by the Company, on an employment-at-will basis, upon the terms and subject to the conditions set forth in this Agreement.
The period of Executive’s employment under this Agreement, as amended and restated, shall begin on April 1, 2022 (the “Commencement Date”) and shall continue until April 1, 2025 (the “Initial Term”), subject to earlier termination in accordance with Section 5 below. At the expiration of the Initial Term, the Agreement shall automatically renew, upon the same terms and conditions, for successive periods of one (1) year, unless either party provides written notice of its intention not to extend the term of the Agreement for an additional one (1) year period at least 90 days prior to the applicable renewal date. As used in this Agreement, the phrase “Employment Term” refers to Executive’s period of employment from the Commencement Date until the date his employment is terminated or terminates and includes any renewal term hereunder.
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If applicable, for the fiscal year in which the Company terminates the Executive’s employment pursuant to Section 5(d), the Executive resigns his employment for Good Reason under Section 5(f) or in any other event pursuant to which Executive becomes eligible to be paid an annual bonus under the Annual Incentive Plan notwithstanding his termination of employment, the Company shall pay the Executive a pro rata portion (based upon the period ending on Executive’s termination date during the fiscal year as compared to the total number of days in the fiscal year) of the bonus that otherwise would have been payable under this Section 4(h) for the fiscal year in which Executive’s employment terminated if Executive had remained employed by the Company. The amount of this pro rata bonus shall be determined as follows: (i) unless the termination was due to death or Disability (as defined in the Annual Incentive Plan), based on the Company’s performance as of the last day of the fiscal year to which the bonus relates or (ii) if the termination was due to death or Disability (as defined in the Annual Incentive Plan), based on the Company performance through the last day of the full fiscal month preceding Executive’s termination. Any amount payable under this Section 4(h) shall be paid as soon as reasonably practicable following the date of determination of the amount, but in no event no later than 2 ½ months following the close of the fiscal year in which the termination occurs. In the event of any inconsistency between the Annual Incentive Plan and this Agreement with respect to Executive’s annual bonus under the Annual Incentive Plan, this Agreement shall govern.
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Executive’s employment under this Agreement may be terminated under any of the circumstances set forth in this Section 5. Upon termination, Executive (or his beneficiary or estate, as the case may be) shall be entitled to receive the compensation and benefits described in Section 6 below, and, if applicable, Section 7 below.
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For the avoidance of doubt, Executive’s good faith error in judgment in the normal course of business shall not constitute Justifiable Cause.
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Upon termination of Executive’s employment under this Agreement for any reason, Executive (or his designated beneficiary or estate, as the case may be) shall be entitled to receive the following compensation:
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Payments equal to three (3) months of Executive’s then current Base Salary PLUS 25% of Executive’s target bonus under the Company’s Annual Incentive Plan applicable for the fiscal year of termination (the “Non-Renewal Severance Payments”), paid in equal monthly installments over the Severance Period; provided that the first installment payment of the Non-Renewal Severance Payments shall be made on the sixtieth (60th) day after the date of Executive’s termination, and will include payment of any installment payments that were otherwise due prior thereto.
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all of which information Executive acknowledges and agrees is not generally known or available to the general public, but has been developed, compiled or acquired by the Company at its great effort and expense. Confidential Information and Trade Secrets can be in any form: oral, written or machine readable, including electronic files. Confidential Information shall not include information that became or becomes generally known to the men’s apparel industry through no wrongful act of Executive. Further, and not withstanding anything else to the contrary in this Agreement, Executive’s general knowledge, experience and “know-how” in the retail industry shall not constitute Confidential Information subject to this Agreement.
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Executive shall not, directly or indirectly, engage in, assist, or have any active interest or involvement - whether as an employee, agent, consultant, creditor, advisor, officer, director, stockholder (excluding holding of less than 3% of the stock of a public company), partner, proprietor or any type of principal whatsoever) or in any other capacity whatsoever, engage in, become financially interested in, be employed by, render any consultation or business advice with respect to, accept any competitive business on behalf of, or have any connection with any business which is competitive with products or services of the Company or any subsidiaries or affiliates, in any geographic area in which the Company or any of its subsidiaries or affiliates are then conducting or proposing to conduct business, including, without limitation, the United States of America and its possessions, Canada and Europe; provided, however, that Executive may own any securities of any corporation which is engaged in such business and is publicly owned and traded but in an amount not to exceed at any one time three percent (3%) of any class of stock or securities of such corporation. For purposes of this provision, a business competitive with the products and services of the Company (or such subsidiaries or affiliates) is limited to a specialty retailer which primarily distributes, sells or markets so-called "big and tall" apparel of any kind for men or which utilizes the "big and tall" retail or wholesale marketing concept as part of its business, or any other business line the Company may enter into in the future and during Executive’s employment. However, nothing in this Section 8 shall be deemed to prohibit Executive from providing services to or becoming involved with any entity with a division or subsidiary that engages in a business competitive with the products and services of the Company (or any subsidiary or affiliate of the Company), as long as Executive is not the chief executive officer of the entity and/or does not work in that competitive division or subsidiary. By signing below, Executive acknowledges and agrees that Executive has received sufficient mutually agreed-upon consideration for agreeing to be bound by the obligations in this Section 8, specifically the LTIP awards, the access to Company confidential information and the potential to receive salary continuation as severance pay (as set forth in Section 7(a) and 7(b) above) in the event Executive is terminated by the Company without Justifiable Cause, Executive terminates for Good Reason or is terminated by the Company at the
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end of the Initial Term (including due to a Structured Retirement), after Executive signs the separation and general release acceptable to the Company. Executive further acknowledges and agrees that the No Competitive Activity restrictions in this Section 8(d) shall apply, including in the event of a termination due to a Structured Retirement, unless Executive is terminated without Justifiable Cause or terminates for Good Reason as defined in this Agreement. The Company’s determination as to whether Justifiable Cause exists must be objectively reasonable and based on evidence. The non-competition restrictions in this Section 8(d) shall become effective as of the Commencement Date.
Executive shall not, either on Executive’s own account or on behalf of any person, firm, or business entity, recruit, solicit, interfere with, or endeavor to cause any employee of the Company with whom Executive came into contact or about whom Executive obtained confidential information, to leave his or her employment with the Company, or to work in a capacity that is competitive with the Company, or to work in a capacity that is similar to the capacity in which the employee was employed by the Company.
(g) Inventions and Discoveries. Upon execution of this Agreement and thereafter, Executive shall promptly and fully disclose to the Company, and with all necessary detail for a complete understanding of the same, all existing and future developments, know-how, discoveries, inventions, improvements, concepts, ideas, writings, formulae, processes and Methods (whether
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copyrightable, patentable or otherwise) made, received, conceived, acquired or written during working hours, or otherwise, by Executive (whether or not at the request or upon the suggestion of the Company) during the period of his employment with, or rendering of advisory or consulting services to, the Company or any of its subsidiaries or affiliates, solely or jointly with others, in or relating to any activities of the Company or its subsidiaries or affiliates known to him as a consequence of his employment or the rendering of advisory and consulting services hereunder (collectively the "Subject Matter"). The Company and Executive acknowledge that Executive has previously authored a book and other published material, and may do so again in the future, and that any such published material authored by Executive does not constitute Subject Matter subject to this Agreement, provided however, that any such published material does not also constitute Confidential Information and Trade Secrets within the meaning of Section 8(a) above.
Except for any previously published material or to be published material authored by Executive, Executive hereby assigns and transfers, and agrees to assign and transfer, to the Company, all his rights, title and interest in and to the Subject Matter, and Executive further agrees to deliver to the Company any and all drawings, notes, specifications and data relating to the Subject Matter, and to execute, acknowledge and deliver all such further papers, including applications for copyrights or patents, as may be necessary to obtain copyrights and patents for any thereof in any and all countries and to vest title thereto to the Company at the Company’s sole expense. Executive shall assist the Company in obtaining such copyrights or patents during the term of this Agreement, and at any time thereafter on reasonable notice and at mutually convenient times, and Executive agrees to testify in any prosecution or litigation involving any of the Subject Matter; provided, however, after the Employment Term that Executive shall be compensated in a timely manner at the rate of $1,000.00 per day (or portion thereof), plus out-of-pocket expenses incurred in rendering such assistance or giving or preparing to give such testimony if it is required after the termination of this Agreement.
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The Company shall withhold from any compensation and benefits payable under this Agreement all applicable federal, state, local, or other taxes.
Nothing in this Agreement shall be construed as giving Executive any claim against any specific assets of the Company or as imposing any trustee relationship upon the Company in respect of Executive. The Company shall not be required to establish a special or separate fund or to segregate any of its assets in order to provide for the satisfaction of its obligations under this Agreement. Executive’s rights under this Agreement shall be limited to those of an unsecured general creditor of the Company and its affiliates.
(a) Executive represents and warrants that he is free to enter into this Agreement and to perform the duties required hereunder, and that there are no employment contracts or understandings, restrictive covenants or other restrictions, whether written or oral, preventing the performance of his duties hereunder.
(b) Executive represents and warrants that he has never been convicted of a felony and he has not been convicted or incarcerated for a misdemeanor within the five years preceding the Commencement Date, other than a first conviction for drunkenness, simple assault, speeding, minor traffic violations, affray, or disturbance of the peace.
(c) Executive represents and warrants that he has never been a party to any judicial or administrative proceeding that resulted in a judgment, decree, or final order (i) enjoining him from future violations of, or prohibiting any violations of any federal or state securities law, or (ii) finding any violations of any federal or state securities law.
Any breach of any of the above representations and warranties is “Justifiable Cause” for termination under Section 5(c) of this Agreement.
Except as otherwise provided in this Agreement, this Agreement shall inure to the benefit of and be binding upon the Parties hereto and their respective heirs, representatives, successors and assigns. The rights and benefits of Executive under this Agreement are personal to him and no such right or benefit shall be subject to voluntary or involuntary alienation, assignment or transfer; provided, however, that nothing in this Section 13 shall preclude Executive from designating a beneficiary or beneficiaries to receive any benefit payable on his death.
As of the Commencement Date, this Agreement, as amended and restated, shall supersede any and all existing oral or written agreements, representations, or warranties between Executive and the Company or any of its subsidiaries or affiliated entities relating to the terms of Executive’s employment. For the avoidance of doubt, the 2016 Plan and LTIP are not incorporated by reference into this Agreement. This Agreement may not be amended except by a written agreement signed by both Parties. Each Party may, in its sole discretion, during the term of Executive’s employment with the Company and thereafter, provide
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copies of this Agreement (or excerpts of the Agreement) to others, including businesses or entities that may employ, do business with, or consider employing Executive in the future. Executive further agrees that any subsequent change or changes in his duties, compensation or areas of responsibility shall in no way affect the validity of this Agreement or otherwise render inapplicable any of the provisions of Sections 4(f), 4(g), 8 or 9 of this Agreement, which shall remain in full force and effect except as may be modified by a subsequent written agreement. Executive understands that he is advised to consult with an attorney before signing this Agreement, and confirms that he has in fact been represented by an attorney throughout the negotiation of and prior to signing this Agreement.
This Agreement shall be governed by and construed in accordance with the domestic substantive laws of the Commonwealth of Massachusetts, without giving effect to any conflicts or choice of laws rule or provision that would result in the application of the domestic substantive laws of any other jurisdiction. The parties shall attempt to resolve any dispute, controversy or difference that may arise between them through good faith negotiations. In the event the parties fail to reach resolution of any such dispute within thirty (30) days after entering into negotiations, either party may proceed to institute action in federal court in Boston or in Superior Court in Suffolk or Norfolk County, Commonwealth of Massachusetts, which courts shall have exclusive jurisdiction, and each party consents to the personal jurisdiction of any such state or federal court. Executive agrees and acknowledges that this is a proper and convenient forum and will not raise objections to this venue based on inconvenient forum, improper venue or similar grounds. By signing this Agreement both parties expressly waive their right to a trial by jury in any such actions filed.
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Any notice, consent, request or other communication made or given in connection with this Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by nationally recognized overnight courier services, by registered or certified mail, return receipt requested, by facsimile or by hand delivery, to those listed below at their following respective addresses or at such other address as each may specify by notice to the others:
To the Company:
Destination XL Group, Inc.
555 Turnpike Street
Canton, MA 02021
Attention: Chair of the Board of Directors
To Executive:
Harvey S. Kanter
At Executive’s current address, as set forth in the payroll records of the Company
For the avoidance of doubt, Executive’s good faith error in judgment in the normal course of business shall not be deemed “activity that is in conflict with or adverse to the interest of the Company or any Subsidiary” as that phrase is used in Section 8(f)(ii) of the 2016 Plan.
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IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of the day and year set forth below.
DESTINATION XL GROUP, INC.
By: /s/ Willem Mesdag______
Name: Willem Mesdag_____
Title: Director and Chairman, Compensation Committee
Date: April 1, 2022
| HARVEY S. KANTER
/s/ Harvey S. Kanter
Date: April 1, 2022
Address: 12 Meadow Lane Mercer Island, WA 98040-5340
|
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EXHIBIT A
Fourth Amended and Restated Long-Term Incentive Plan
(attached separately)
EXHIBIT B
SEPARATION AGREEMENT AND GENERAL RELEASE OF CLAIMS
3. Restrictive Covenants and No Competitive Activity. Executive agrees that Executive remains bound by the restrictive covenants set forth in Sections 8(a) – 8(c) and Sections 8(e) – 8(j) of Executive’s Employment Agreement, all of which are specifically incorporated into this Agreement and General Release Of Claims. Executive further acknowledges and agrees that the Company is engaged in a highly competitive business and that by virtue of Executive’s position and responsibilities with the Company and Executive’s access to the Confidential Information and Trade Secrets, engaging in any business which is directly competitive with the Company will cause Company great and irreparable harm. Therefore, in consideration for the LTIP awards referenced in Section 4(i) of Executive’s Employment Agreement signed by Executive on April 1, 2022 and the good and valuable consideration to be paid after the date of Executive’s termination as set forth in the Employment Agreement, Executive further covenants and agrees that at all times during the period beginning on the date of termination of his employment (whether such termination was voluntary or involuntary, with Good Reason or without Good Reason, for Justifiable Cause or without Justifiable Cause, due to a Structured Retirement or otherwise) and ending on the later of (A) one (1) year following Executive’s date of termination or (B) the expiration of any tolling period extending the one year period in clause (A), Executive shall not, directly or indirectly, engage in, assist, or have any active interest or involvement - whether as an employee, agent, consultant, creditor, advisor, officer, director, stockholder (excluding holding of less than 3% of the stock of a public company), partner, proprietor or any type of principal whatsoever) or in any other capacity whatsoever, engage in, become financially interested in, be employed by, render any consultation or business advice with respect to, accept any competitive business on behalf of, or have any connection with any business which is competitive with products or services of the Company or any subsidiaries or affiliates, in any geographic area in which the Company or any of its subsidiaries or affiliates are then conducting or proposing to conduct business, including, without limitation, the United States of America and its possessions, Canada and Europe; provided, however, that Executive may own any securities of any corporation which is engaged in such business and is publicly owned and traded but in an amount not to exceed at any one time three percent (3%) of any class of stock or securities of such corporation. In addition, Executive shall not, during the Non-Competitive Period, directly or indirectly, request or cause any suppliers or customers with whom the Company or any of its subsidiaries or affiliates has a business relationship to cancel or terminate any such business relationship with the Company or any of its subsidiaries or affiliates or otherwise compromise the Company’s good will or solicit, hire, interfere with or entice from the Company or any of its subsidiaries or affiliates any employee (or former employee who has been separated for less than 12 months) of the Company or any of its subsidiaries or affiliates. For purposes of this provision, a business competitive with the products and services of the Company (or such subsidiaries or affiliates) is limited to a specialty retailer which primarily distributes, sells or markets so-called "big and tall" apparel of any kind for men or which utilizes the "big and tall" retail or wholesale marketing concept as part of its business, or any other business line the Company may enter into in the future and during Executive’s employment. However, nothing in Section 8 of Executive’s Employment Agreement shall be deemed to prohibit Executive from providing services to or becoming involved with any entity with a division or subsidiary that engages in a business competitive with the products and services of the Company (or any subsidiary or affiliate of the Company), as long as Executive is not the chief executive officer of the entity and/or does not work in that competitive division or subsidiary.
4. Executive is advised that Executive has up to twenty-one (21) calendar days to consider this General Release before signing it. Executive may knowingly and voluntarily waive that up to twenty-one (21) day period by signing this General Release of Claims earlier. However, in the event Executive’s employment terminated as part of a group termination within the meaning of the Older Workers Benefits Protection Act, the up to twenty-one (21) day consideration period shall be enlarged to up to forty-five (45) calendar days, and Executive shall be provided with additional disclosures required by the Older Workers
Benefit Protection Act prior to the start of the up to forty-five (45) calendar day consideration period. In either case, Executive also shall have seven (7) calendar days following the date on which Executive signs this General Release of Claims within which to revoke it by providing a written notice of his or her revocation to the Company. Any such revocation shall be directed to the VP, Managing Director-Human Resources and must be delivered to the VP, Managing Director-Human Resources within that seven (7) day revocation period, or mailed to Destination XL Group, Inc., Attn: VP, Managing Director-Human Resources, 555 Turnpike Street, Canton, MA 02021 and postmarked within the seven (7) day revocation period.
5. Executive acknowledges that this General Release of Claims will be governed by and construed and enforced in accordance with the internal laws of the Commonwealth of Massachusetts applicable to contracts made and to be performed entirely within the Commonwealth.
6. Executive acknowledges that he or she has read this General Release of Claims, has been advised that he or she should consult with an attorney before executing this general release of claims, and that he or she understands all of its terms and executes it voluntarily and with full knowledge of its significance and the consequences thereof.
7. This General Release of Claims shall take effect on the eighth day following Executive’s execution of this General Release of Claims unless Executive’s written revocation is delivered to the Company within seven (7) days after such execution.
HARVEY S. KANTER
Date:_________________
DESTINATION XL GROUP, INC.
By: _______________________________________
Name: _____________________________________
Title: ______________________________________
Date: ______________________________________