{"id":38931,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/employment-agreement-anntaylor-stores-corp-and-j-patrick.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"employment-agreement-anntaylor-stores-corp-and-j-patrick","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/employment-agreement-anntaylor-stores-corp-and-j-patrick.html","title":{"rendered":"Employment Agreement &#8211; AnnTaylor Stores Corp. and J. Patrick Spainhour"},"content":{"rendered":"<pre>                              EMPLOYMENT AGREEMENT\n\n          EMPLOYMENT AGREEMENT (the 'Agreement'), dated as of February 16, 1996,\neffective as of February 19, 1996 (the 'Starting Date') between ANNTAYLOR STORES\nCORPORATION, a Delaware corporation (the 'Company'), and J. PATRICK SPAINHOUR\n(the 'Executive').\n\n          WHEREAS, the Company desires to provide for the services and\nemployment of the Executive with the Company and the Executive wishes to\nprovide such services and to become employed by the Company, all in accordance\nwith the terms and conditions provided herein.\n\n          NOW, THEREFORE, in consideration of the premises and the respective\ncovenants and agreements of the parties herein contained, and intending to be\nlegally bound hereby, the parties hereto agree as follows:\n\n          1.   Employment. The Company hereby agrees to employ the Executive,\nand the Executive hereby agrees to become employed by and to serve the Company,\non the terms and conditions set forth herein.\n\n          2.   Term. The initial term of employment of the Executive by the\nCompany hereunder will commence effective as of the Starting Date, and such\ninitial term will end 36 months thereafter unless further extended or sooner\nterminated as hereinafter provided. Commencing on the third anniversary date\nof the Starting Date, and on each anniversary date of the Starting Date\nthereafter (each date, an 'Anniversary Date'), the term of the Executive's\nemployment shall automatically be extended for one additional year unless not\nlater than six months prior to such Anniversary Date, either party shall have\ngiven notice (a 'Nonrenewal Notice') to the other party that it does not wish\nto extend this Agreement. References hereinafter to the 'Term' of this\nAgreement shall refer to both the initial term and any extended term of the\nAgreement hereunder. Notwithstanding expiration of the Term or other provisions\nthat survive by their intent, the provisions of Sections 3(b), 9 and 10 hereof\nshall continue in effect.\n\n          3.   Nature of Performance.\n\n               (a)  Position and Duties. The Executive shall serve as President\nand Chief Operating Officer of the Company and shall have such responsibilities,\nduties and authority consistent with such positions as may from time to time be\ndetermined by the Board of Directors of the Company (the 'Board'). The Executive\nshall report directly to the Chairman and Chief Executive\n\n\n\n\n                                        1\n\n\n\nOfficer. Initially, the following officers and executives of the Company\nshall report directly to the Executive who shall have the responsibility of\noverseeing, coordinating and directing their performance: Chief Financial\nOfficer and Executive Vice President of Strategic Planning (which includes\nindirect reporting through such officer of Investor Relations, Legal Services\nand Credit Services), Senior Vice President Information Services, Distribution\nServices and Logistics, Senior Vice President Real Estate, Store Planning and\nDesign, Senior Vice President Human Resources and executives in charge of\nSourcing and Quality Assurance. The Executive shall devote substantially all of\nhis working time and effects to the business and affairs of the Company;\nprovided that, this Agreement shall not be interpreted to prohibit the Executive\nfrom making passive investments, engaging in charitable activities or, subject\nto prior approval of the Board (which approval shall not be unreasonably\nwithheld), serving on the board of directors of any other corporation. The\nCompany shall also use its best efforts to appoint and elect Executive as a\nmember of the Company's Board of Directors at the earliest possible date. Such\nappointment and election shall be to that Class of Directors which shall be\nsubject to election by the stockholders of the Company at the latest possible\ntime consistent with Company's Certificate of Incorporation and Bylaws.\n\n               (b)  Indemnification. To the fullest extent permitted by law\nand the Company's certificate of incorporation and by-laws, the Company shall\nindemnify the Executive for all amounts (including, without limitation,\njudgments, fines, settlement payments, losses, damages, costs and expenses\n(including reasonable attorneys' fees)) incurred or paid by the Executive in\nconnection with any action, proceeding, suit or investigation arising out of\nor relating to the performance by the Executive of services for, or acting as\na fiduciary of any employee benefit plans, programs or arrangements of the\nCompany or as a director, officer or employee of, the Company or any\nsubsidiary thereof. Following the Term, the Company shall continue to\nindemnify the Executive with respect to such services performed during the\nTerm, to the same extent as the Company indemnifies its officers, directors,\nemployees and fiduciaries, as applicable. Executive shall be provided director\nand officer liability insurance coverage by the Company on the same terms and\nconditions as that being provided to any other director and officer of the\nCompany from time to time during the Term hereof.\n\n          4.   Place of Performance. In connection with the Executive's\nemployment by the Company, the Executive shall be based at the principal\nexecutive offices of the Company in the City of New York or at such other\nprincipal executive office in the New York City Metropolitan Area as the\nCompany may hereafter maintain, except for required travel on the Company's\nbusiness. The Company is aware that Executive maintains his principal residence\nand his family resides in Columbus, Mississippi. The Company has been advised\nby Executive that he intends to continue to maintain such residence which will\nrequire\n\n\n\n\n                                        2\n\n\n\nExecutive to commute at Executive's sole cost and expense between the\nCompany's headquarters and his residence in Mississippi on a regular basis to\nwhich the Company has no objection.\n\n          5.   Compensation and Related Matters.\n\n               (a)   Annual Compensation.\n\n                    (i)   Base Salary. During the period of the Executive's\n          employment hereunder, the Company shall pay to the Executive an\n          annual base salary at a rate not less than $525,000, such salary\n          to be paid in conformity with the Company's policies relating to\n          salaried employees. This salary may be (but is not required to\n          be) increased from time to time, subject to and in accordance\n          with the annual executive performance review procedures of the\n          Company and, if so increased, shall not thereafter be decreased\n          during the Term of this Agreement. Compensation of the Executive\n          by salary payments shall not be deemed exclusive and shall not\n          prevent the Executive from participating in any other\n          compensation or benefit plan of the Company. The salary payments\n          (including any increased salary payments) hereunder shall not in\n          any way limit or reduce any other obligation of the Company\n          hereunder, and no other compensation, benefit or payment\n          hereunder shall in any way limit or reduce the obligation of the\n          Company to pay the Executive's salary hereunder.\n\n                    (ii)   Annual Bonus. During the period of Executive's\n          employment hereunder, the Executive shall be eligible to\n          participate in the Company's annual bonus plan as in effect from\n          time to time, and shall be entitled to receive such amounts (a\n          'Bonus') as may be authorized, declared and paid by the Company\n          pursuant to the terms of such plan; provided that,\n          notwithstanding any contrary provisions of such bonus plan,\n          unless the Executive's employment is terminated by the Company\n          for Cause (as defined in Section 6(c) hereof) or by the Executive\n          other than for Good Reason, as defined in Section 6(d)(1)\n          hereof), the Executive shall be entitled to receive any Bonus\n          paid with respect to any bonus period completed on or prior to\n          the Date of Termination or, in the case a Nonrenewal Notice is\n          given by the Company, through the scheduled expiration date of\n          the Term (even if the Executive terminates his employment prior\n          to such scheduled expiration date for Good Reason under Section\n          6(d)(1)(v) hereof). The Company currently maintains a Management\n          Performance Compensation Plan (the 'Performance Plan') pursuant\n          to which it pays performance bonus compensation to certain of its\n\n\n\n\n                                        3\n\n\n\n          executives and employees. It is agreed that Executive shall\n          participate in the Performance Plan effective as of the Starting\n          Date. Executive's Performance Percentage (as that term is defined\n          in the Performance Plan) shall be established at 40% during the\n          first year of participation under the Performance Plan and\n          thereafter the Performance Percentage shall be determined as\n          provided in the Performance Plan. Notwithstanding the foregoing,\n          the minimum bonus to be paid to Executive under the Performance\n          Plan or otherwise for the fiscal year ending February 1, 1997\n          shall be $200,000, provided Executive's employment hereunder\n          during such period has not been terminated by the Company for\n          Cause or by the Executive without Good Reason.\n\n               (b)   Stock Options. The Executive will be granted a time vested\nNon-Qualified Stock Option to acquire one hundred thousand (100,000) shares of\nthe Company's Common Stock (the 'Option Shares') under the Company's 1992 Stock\nOption and Restricted Stock and Unit Award Plan (the 'Option Plan') with an\nexercise price equal to the fair market value (as defined and determined as of\nthe Starting Date under the Option Plan) of the Common Stock. The Option shall\nvest 50% on the first anniversary date of the grant and 50% on the second\nanniversary date of the grant and shall be subject to accelerated vesting and\ntermination in accordance with the terms of the Option Plan. The Executive shall\nbe eligible to receive additional options under the Option Plan or other and\nadditional option plans as may be adopted by the Company during the term hereof,\ntaking into account, among other things, Executive's performance and position\nwith the Company.\n\n              (c)   Other Benefits. During the period of Executive's employment\nhereunder, the Executive shall continue to be entitled to participate in all\nother employee benefit plans, programs and arrangements of the Company, as now\nor hereinafter in effect, which are applicable to the Company's employees\ngenerally or to its executive officers, as the case may be, subject to and on a\nbasis consistent with the terms, conditions and overall administration of such\nplans, programs and arrangements; provided, the Company shall waive or cause to\nbe waived the one year waiting period after commencement of employment\napplicable to its life insurance and group accident insurance programs and any\nother program where such waiver will not be a violation of any Federal or state\nlaw or regulation . During the period of Executive's employment hereunder, the\nExecutive shall be entitled to participate in and receive any fringe benefits or\nperquisites which may become available to the Company's executive employees.\nWithout limiting the generality of the foregoing, the Company shall provide the\nExecutive with financial planning and tax preparation services on a tax-free\nbasis.\n               (e)   Vacations and Other Leaves.  The Executive shall be\n\n\n\n\n                                        4\n\n\n\nentitled to an aggregate paid vacation of not less than four (4) weeks for each\ntwelve (12) month period of the Term hereof. Payment for any accrued and unused\nvacation time at the time of termination of this Agreement shall be in\naccordance with the Company's policies at the time of such termination. Any such\nvacation taken shall be coordinated with the Chairman so as not to adversely\nimpact the performance of the Company. The Executive shall be entitled to paid\nholidays and personal leave days in accordance with the Company policy covering\nexecutive employees.\n\n               (f)   Expenses. During the period of the Executive's employment\nhereunder, the Executive shall be entitled to receive prompt reimbursement for\nall reasonable and customary expenses incurred by the Executive in performing\nservices hereunder, including all expenses of travel and accommodations while\naway from home on business or at the request of and in the service of the\nCompany; provided that, such expenses are incurred and accounted for in\naccordance with the policies and procedures established by the Company. It is\nunderstood and agreed by Executive that such reimbursement shall not cover\nexpenses and costs incurred by him in connection with his commuting from his\nprincipal residence as described in Section 4 of this Agreement.\n\n                (g)   Services Furnished. The Company shall furnish the\nExecutive with office space, stenographic assistance and such other facilities\nand services as shall be suitable to the Executive's position and adequate for\nthe performance of his duties hereunder.\n\n                (h)   Legal Fees. The Company shall pay directly or reimburse\nthe Executive for any legal fees incurred by the Executive in connection with\nthe negotiation and preparation of the Agreement; provided that, such payment\nor reimbursement shall not exceed $5,000.\n\n          (6)  Termination. The Executive's employment hereunder may be\nterminated without breach of this Agreement only under the following\ncircumstances:\n\n                (a)   Death. The Executive's employment hereunder shall\nterminate upon his death.\n\n                (b)   Disability. If, as a result of the Executive's incapacity\ndue to physical or mental illness, the Executive shall have been absent\nfrom his duties hereunder on a full time basis for the entire period of six (6)\nconsecutive months, and within thirty (30) days after written Notice of\nTermination (as defined below) is given (which may occur before or after the end\nof such six (6) month period) shall not have returned to the performance of his\nduties hereunder on a full-\n\n\n\n\n                                        5\n\n\n\ntime basis, the Executive's employment hereunder shall terminate for\n'Disability.'\n\n                (c)   Cause. The Company may terminate the Executive's\nemployment hereunder for 'Cause'. For purposes of this Agreement, the Company\nshall have 'Cause' to terminate the Executive's employment hereunder upon (i)\nthe Executive's conviction for the commission of any act or acts constituting a\nfelony under the laws of the United States or any state thereof, (ii) action by\nthe Executive toward the Company involving dishonesty (other than good faith\nexpense account disputes), (iii) the Executive's refusal to abide by or follow\nwritten directions of the Board or the Chairman, (iv) the Executive's gross\nnonfeasance which does not cease within ten (10) business days after notice\nregarding such nonfeasance has been given to the Executive by the Company or\n(v) failure of the Executive to comply with the provisions of Section 9 (prior\nto a cessation of employment following a Change in Control of the Company) or\n10 of this Agreement, or other willful conduct by the Executive which is\nintended to have and does have a material adverse impact on the Company.\n\n               (d)  Termination by the Executive.\n\n                    (1)   The Executive may terminate his employment hereunder\n          for 'Good Reason'. For purposes of this Agreement, the Executive\n          shall have 'Good Reason' to terminate his employment hereunder\n          (i) upon a failure by the Company to comply with any material\n          provision of this Agreement which has not been cured within ten\n          (10) business days after notice of such noncompliance has been\n          given by the Executive to the Company, (ii) upon action by the\n          Company resulting in a diminution of the Executive's title or\n          authority, (iii) upon the Company's relocation of the Executive's\n          principal place of employment outside of the New York City\n          Metropolitan Area, (iv) one year after a 'Change in Control of\n          the Company' (as defined in paragraph (d)(2) below) or (v) at any\n          time following the expiration of ninety (90) days following the\n          Company's issuance of a Nonrenewal Notice. The Executive may\n          terminate his employment voluntarily without Good Reason upon at\n          least six months' prior notice to the Company.\n\n                    (2)  For purposes of this Agreement, a 'Change in Control of\n          the Company' will be deemed to have occurred if:\n\n               (A)  any 'person', as such term is used in Section 13(d) and\n                    14(d) of the Securities Exchange Act of 1934, as amended\n                    (the 'Exchange Act'), other than (1) the Company, (2)\n                    Merrill Lynch &amp; Co. or any affiliate thereof,\n\n\n\n\n                                        6\n\n\n\n                    which for purposes of this Agreement shall include\n                    Stonington Partners Inc. and its affiliates (collectively,\n                    'ML'), (3) any trustee or other fiduciary holding securities\n                    under an employee benefit plan of the company, or (4) any\n                    corporation owned, directly or indirectly, by the\n                    stockholders of the Company (in substantially the same\n                    proportion as their ownership of Shares ) (a 'Person') is or\n                    becomes the 'beneficial owner' (as defined in Rule 13d-3\n                    under the Exchange Act), directly or indirectly, of\n                    securities of the Company representing 30% or more of the\n                    combined voting power of the Company's then outstanding\n                    voting securities (not including in the securities\n                    beneficially owned by such Person securities acquired\n                    directly from ML representing in excess of 15% of the\n                    combined voting power of the Company's then outstanding\n                    voting securities but including any such securities acquired\n                    directly from ML representing up to 15% of such combined\n                    voting power);\n\n               (B)  during any period of not more than two consecutive years,\n                    individuals who at the beginning of such period constitute\n                    the Board, and any new director (other than a director\n                    designated by a person who has entered into an agreement\n                    with the Company to effect a transaction described in clause\n                    (A), (C) or (D) of this Section 6(d)(2)) whose election by\n                    the Board or nomination for election by the Company's\n                    stockholders was approved by a vote of at least two-thirds\n                    (2\/3) of the directors then still in office who either were\n                    directors at the beginning of the period or whose election\n                    or nomination for election was previously so approved, cease\n                    for any reason to constitute at least a majority thereof;\n\n               (C)  the stockholders of the company approve a merger or\n                    consolidation of the Company with any other corporation,\n                    other than (1) a merger or consolidation which would result\n                    in the voting securities of the Company outstanding\n                    immediately prior thereto continuing to represent (either by\n                    remaining outstanding or by being converted into voting\n                    securities of the surviving or parent entity) 50% or more of\n                    the combined voting power of the voting securities of the\n                    Company or such surviving or parent entity outstanding\n                    immediately after such merger\n\n\n\n\n                                        7\n\n\n\n                    or consolidation or (2) a merger or consolidation effected\n                    to implement a recapitalization of the Company (or similar\n                    transaction) in which no Person is or becomes the beneficial\n                    owner (as defined in (A) above), directly or indirectly, of\n                    securities of the Company representing 30% or more of the\n                    combined voting power of the Company's then outstanding\n                    securities (not including in the securities beneficially\n                    owned by such Person securities acquired directly from ML\n                    representing in excess of 15% of the combined voting power\n                    of the Company's then outstanding voting securities but\n                    including any such securities acquired directly from ML\n                    representing up to 15% of such combined voting power); or\n\n               (D)  the stockholders of the Company approve a plan of complete\n                    liquidation of the company or an agreement for the sale or\n                    disposition by the company of all or substantially all of\n                    the Company's assets (or any transaction having a similar\n                    effect).\n\n               (e)  Notice of Termination. Any termination of the Executive's\nemployment by the Company or by the Executive (other than termination under\nSection 6(a) hereof) shall be communicated by written Notice of Termination to\nthe other party hereto in accordance with Section 12 hereof. For purposes of\nthis Agreement, a 'Notice of Termination' shall mean a notice which shall\nindicate the specific termination provision in this Agreement relied upon and\nshall set forth in reasonable detail the facts and circumstances claimed to\nprovide a basis for termination of the Executive's employment under the\nprovision to indicated.\n\n               (f) Date of Termination. 'Date of Termination' shall mean (I)\nif the Executive's employment is terminated by his death, the date of his death,\n(ii) if the Executive's employment is terminated pursuant to Subsection (b)\nabove, the date which is the later of thirty (30) days after Notice of\nTermination is given (provided that the Executive shall not have returned to the\nperformance of his duties on a full-time basis during such thirty (30) day\nperiod) or the end of the six (6) consecutive month period referred to in\nSubsection (b) above, and (iii) if the Executive's employment is terminated\npursuant to subsection (c) or (d) above, the date specified in the Notice of\nTermination; provided that, if within thirty (30) days after any Notice of\nTermination is given the party receiving such Notice of Termination notifies the\nother party that a dispute exists concerning the termination, the Date of\nTermination shall be the date on which the dispute is\n\n\n\n\n                                        8\n\n\n\nfinally determined, either by mutual written agreement of the parties\nor by a binding and final arbitration award.\n\n          7.   Compensation Upon Termination or During Disability.\n\n               (a)   Disability. During any period that the Executive fails to\nperform his duties hereunder as a result of incapacity due to physical or mental\nillness, the Executive shall continue to receive his full salary at the rate\nthen in effect for such period and other applicable benefits provided to active\nemployees until his employment is terminated pursuant to Section 6(b) hereof.\nSubject to the provisions of Section 9 hereof, in the event the Executive's\nemployment is terminated pursuant to Section 6(b) hereof, then\n\n                    (i)  as soon as practicable thereafter, the Company shall\n          pay the Executive all unpaid amounts, if any, to which the Executive\n          is entitled as of the Date of Termination under Sections 5(a) and (b)\n          hereof and shall pay to the Executive, in accordance with the terms of\n          the applicable plan or program, all other unpaid amounts to which\n          Executive is then entitled under any compensation or benefit plan or\n          program of the Company (collectively, 'Accrued Obligations'); and\n\n                   (ii) following the Date of Termination and for a period of\n          twelve (12) months thereafter (the 'Severance Period'), the Company\n          shall pay the Executive monthly an amount equal to (x) the quotient\n          of (A) the sum of (1) the Executive's annual base salary at the rate\n          in effect as of the Date of Termination and (2) the average of the\n          annual bonuses, or in the case of the first year hereof (if the Date\n          of Termination occurs in such year) the guaranteed minimum bonus,\n          earned by the Executive in the three fiscal years of the Company\n          ended immediately prior to the Date of Termination, divided by (B)\n          the number twelve (12) (such quotient being referred to herein as the\n          'Severance Payments'), minus (y) any amounts payable to the Executive\n          during such month as a disability benefit under a Company paid plan.\n\n               (b)  Death. If the Executive's employment is terminated by his\ndeath, the Company shall pay to the person(s) or entity set forth in Section\n11(b) hereof the Accrued Obligations and the Severance Payments at the time(s)\nset forth in Sections 7(a)(i) and 7 (a)(ii) hereof.\n\n               (c)  Termination for Cause; Voluntary Termination Without Good\nReason. If the Executive's employment is terminated by the Company for\n\n\n\n\n                                        9\n\n\n\nCause or voluntarily by the Executive for other than Good Reason (including by\nreason of the expiration of the Term of this Agreement as a result of a\nNonrenewal Notice having been given by the Executive), the Company shall pay the\nAccrued Obligations to the Executive at the time(s) set forth in Section 7(a)(i)\nhereof and the Company shall have no further obligations to the Executive under\nthis Agreement.\n\n               (d) Termination Without Cause; Termination for Good Reason;\nNonrenewal. If (i) the Company shall terminate the Executive's employment other\nthan for Disability pursuant to Section 6(b) or for Cause, (ii) the Executive\nshall terminate his employment for Good Reason or (iii) the Term of this\nAgreement expires as a result of a Nonrenewal Notice having been provided by the\nCompany, then, subject to the provisions of Section 9 hereof:\n\n               (1)  the Company shall pay the Accrued Obligations to the\n                    Executive at the time(s) set forth in Section 7(a)(i)\n                    hereof;\n\n               (2)  the Company shall pay to the Executive the Severance\n                    Payments as defined in Section 7(a)(ii) hereof for the\n                    longer of the remaining Term of this Agreement and the\n                    Severance Period;\n\n               (3)  the Executive shall continue to be provided with the same\n                    medical and life insurance coverage as existed immediately\n                    prior to the applicable Notice of Termination or Notice of\n                    Nonrenewal, as the case may be, such coverage to continue as\n                    long as Executive is receiving Severance Payments; and\n\n               (4)  the Executive shall be provided with outplacement services\n                    commensurate with his position.\n\n           8.   Change in Control. In the event that any payment or benefit\nreceived or to be received by the Executive in connection with a Change in\nControl of the Company or the termination of the Executive's employment, whether\nsuch payments or benefits are received pursuant to the terms of this Agreement\nor any other plan, arrangement or agreement with the Company, any person whose\nactions result in a Change in Control of the Company or any person affiliated\nwith the Company or such person (all such payments and benefits being\nhereinafter called 'Total Payments'), would be subject (in whole or part), to\nthe tax (the 'Excise Tax') imposed under Section 4999 of the Internal Revenue\nCode of 1986, as amended (the 'Code'), the Company shall pay to the Executive\nsuch additional\n\n\n\n\n                                        10\n\n\n\namounts (the 'Gross-Up Payment') as may be necessary to place the Executive in\nthe same after-tax position as if no portion of the Total Payments had been\nsubject to the Excise Tax. In the event that the Excise Tax is subsequently\ndetermined to be less than the amount taken into account hereunder, the\nExecutive shall repay to the Company, at the time that the amount of such\nreduction in Excise Tax is finally determined, the portion of the Gross-Up\nPayment attributable to the reduction (plus that portion of the Gross-Up Payment\nattributable to the Excise Tax and federal, state and local income tax imposed\non the Gross-Up Payment being repaid by the Executive to the extent that such\nrepayment results in a reduction in Excise Tax and\/or federal, state or local\nincome tax deduction) plus interest on the amount of such repayment at the rate\nprovided in Section 1274(b)(2)(B) of the Code. In the event that the Excise Tax\nis determined to exceed the amount taken into account hereunder (including by\nreason of any payment the existence of which cannot be determined at the time of\nthe Gross- Up Payment, the Company shall make an additional Gross-Up Payment in\nrespect of such excess (plus any interest, penalties or additions payable by the\nExecutive with respect of such excess) at the time that the amount of such\nexcess if finally determined. The Executive and the Company shall each\nreasonably cooperate with the other in connection with any administrative or\njudicial proceedings concerning the existence or amount of liability for Excise\nTax with respect to the Total Payments.\n\n          9.   Nonsolicitation; Noncompete\n\n               (a)   Subject to (c) below, during the period of Executive's\nemployment, during the period he is receiving Severance Payments hereunder and,\nin the case where the Executive's employment is terminated for Cause or\nExecutive voluntarily terminates his employment without Good Reason, for a\nperiod of twelve (12) months following such termination, the Executive shall not\ninitiate discussions (of a non-isolated nature) with any person who is then an\nexecutive employee of the Company (i.e., director level or above) with the\nintent of soliciting or inducing such person to leave his or her employment,\nwith a view toward joining the Executive in the pursuit of any business activity\n(whether or not such activity involves engaging or participating in a\nCompetitive Business (as defined below). Notwithstanding any other provision of\nthis Agreement to the contrary, in the event Executive fails to comply with the\npreceding sentence, all rights of the Executive and his surviving spouse or\nother beneficiary hereunder to any future Severance Payments and continuing life\ninsurance and medical coverage shall be forfeited; provided that, the foregoing\nshall not apply if such failure of compliance commences following a cessation of\nemployment following a Change in Control of the Company.\n\n               (b)   Subject to (c) below, as long as Executive receives\nSeverance Payments, or in the case where the Executive's employment is\n\n\n\n\n                                        11\n\n\n\nterminated for Cause or Executive voluntarily terminates his employment without\nGood Reason, for a period of twelve (12) months following such termination,\nExecutive shall not, without the prior written consent of the Company (which\nconsent shall not be unreasonably withheld), engage or participate in any\nbusiness which is 'in competition' (as defined below) with the business of the\nCompany or any of its 50% or more owned affiliates (such business being referred\nto herein as a 'Competitive Business'). Notwithstanding any other provision of\nthis Agreement to the contrary, in the event the Executive fails to comply with\nthe preceding sentence, all rights of the Executive and his surviving spouse or\nother beneficiary hereunder to any future Severance Payments and continuing life\ninsurance and medical coverage shall be forfeited; provided that, the foregoing\nshall not apply if such failure of compliance commences following a cessation of\nemployment following a Change in Control of the Company.\n\n               (c) In the event of a violation of paragraphs 9(a) or 9(b)\nhereof, the remedies of the Company shall be limited to (i) if such violation\noccurs during the period of Executive's employment hereunder, termination of the\nExecutive for Cause and the associated rights of the Company specified herein\nresulting therefrom and (ii) regardless of when such violation occurs,\nforfeiture by the Executive of the payments and benefits set forth in paragraphs\n(a) and (b) above if and to the extent provided in such paragraphs and (iii) the\nright to seek injunctive relief in accordance with and to the extent provided in\nSection 16 hereof; provided, such injunctive relief may only be sought for\ncompetitive activity under paragraph (b) above if such activity occurs during\nemployment or after Executive's dismissal for Cause or Executive voluntarily\nterminates his employment without Good Reason.\n\n               (d)  For purposes hereof, a business will be 'in competition'\nwith the business of the Company or its 50% or more owned affiliates only if (i)\nthe Company's business with which the other business competes accounted for 20%\nor more of the Company's consolidated revenues as of the end of its most\nrecently completed fiscal year prior to the Date of Termination, and (ii) the\nentity (including all 50% or more owned affiliates) through which the other\nbusiness is or will be operated maintains a 'woman's apparel' business which\ngenerated at least $50 million in revenues during the entity's most recently\ncompleted fiscal year ended prior to the date the Executive commences (or\nproposes to commence) to engage or participate in the other business. For\npurposes hereof, 'woman's apparel' shall consist of dresses, jackets, pants,\nskirts, blouses, sweaters and T-shirts.\n\n               (e) Notwithstanding the foregoing, the Executive's engaging in\nthe following activities shall not be construed as engaging or participating in\na Competitive Business: (i) investment banking; (ii) passive ownership of less\nthan\n\n\n\n\n                                        12\n\n\n\n2% of any class of securities of a public company; (iii) engaging or\nparticipating in noncompetitive businesses of an entity which also operates a\nbusiness which is 'in competition' with the business of the Company or its\naffiliates; (iv) serving as an outside director of an entity which operates a\nbusiness which is 'in competition' with the business of the Company or its\naffiliates, so long as such business did not account for 10% or more of the\nconsolidated revenues of such entity as of the end of its most recently\ncompleted fiscal year prior to the date Executive commences ( or proposes to\ncommence) serving as a outside director; (v) engaging in a business involving\nlicensing arrangements so long as such business is not an in-house arrangement\nfor any entity 'in competition' with the business of the Company or its\naffiliates; (vi) affiliation with an advertising agency; and (vii) after\ncessation of employment, engaging or participating in the 'wholesale' side of\nthe woman's apparel business, which for purposes hereof shall mean the design,\nmanufacture and sale of piece goods and woman's apparel to unrelated third\nparties, provided that if the entity for which Executive so engages or\nparticipates (including its affiliates) also conducts a retail woman's apparel\nbusiness , then effective upon Executive's engaging or participating in such\nbusiness, all continuing life insurance and medical coverage provided by the\nCompany shall cease and all Severance Payments shall cease except for amounts\nrepresenting the excess (if any) of Executive's annual base salary hereunder (at\nthe rate in effect as of the Date of Termination) over the Executive's base\nsalary received from such entity and its affiliates, which amounts shall\ncontinue to be paid by the Company for the remainder of the Severance Period.\nThe exceptions contained in subparagraph (vii) above and subparagraph (iii)\nabove to the extent covered by subparagraph (vii) shall not be applicable if\nExecutive's cessation of employment is voluntary by Executive without Good\nReason and his new engagement or participation involves 'wholesale' operations\nwhich include or also conduct retail sales of woman's apparel other than factory\noutlet or discount stores to liquidate unsold woman's apparel of such wholesale\noperations.\n\n          10.  Protection of Confidential Information\n\n               (a)  Executive acknowledges that his employment by the\nCompany will, throughout the Term of this Agreement, involve his obtaining\nknowledge of confidential information regarding the business and affairs of the\nCompany. In recognition of the foregoing, the Executive covenants and agrees:\n\n                    (i)  that, except in compliance with legal process, he will\nkeep secret all confidential matters of the Company which are not otherwise in\nthe public domain and will not be intentionally disclose them to anyone outside\nof the Company, wherever located (other than to a person to whom disclosure is\nreasonably necessary or appropriate in connection with the performance by\nExecutive of his duties as an executive officer of the Company), either during\nor\n\n\n\n\n                                        13\n\n\n\nafter the Term, except with the prior written consent of the Board or a person\nauthorized thereby; and\n\n                    (ii) that he will deliver promptly to the Company on\ntermination of his employment, or at any other time the Company may so request,\nall memoranda, notes, records, customer lists, reports and other documents (and\nall copies thereof) relating to the business of the Company which he obtained\nwhile employed by, or otherwise serving or acting on behalf of, the Company and\nwhich he may then possess or have under his control.\n\n                    (b) Notwithstanding the provisions of Section 16 of this\nAgreement, if the Executive commits a breach of the provisions of paragraphs\n10(a)(i) or 10(a)(ii), the Company shall have the right and remedy to have\nsuch provisions specifically enforced by any court having equity jurisdiction,\nit being acknowledged and agreed that any such breach or threatened breach\nwill cause irreparable injury to the Company and that money damages will not\nprovide an adequate remedy to the Company.\n\n          11.   Successors; Binding Agreement\n\n                (a) Neither this Agreement nor any rights hereunder shall be\nassignable or otherwise subject to hypothecation by the Executive (except by\nWill or by operation of the laws of intestate succession) or by the Company,\nexcept that the Company will require any successor (whether direct or indirect,\nby purchase, merger, consolidation or otherwise), to all or substantially all of\nthe business and\/or assets of the Company, by agreement in form and substance\nreasonably satisfactory to the Executive, to expressly assume and agree to\nperform this Agreement in the same manner and to the same extent that the\nCompany would be required to perform it if no such succession had taken place.\nFailure of the Company to obtain such assumption and agreement prior to the\neffectiveness of any such succession shall be a breach of this Agreement and\nshall entitle the Executive to compensation from the Company in the same amount\nand on the same terms as he would be entitled to hereunder if he terminated his\nemployment for Good Reason, except that for purposes of implementing the\nforegoing, the date on which any such succession becomes effective shall be\ndeemed the Date of Termination. As used in this Agreement, 'Company' shall mean\nthe Company as herein before defined and any successor to its business and\/or\nassets as aforesaid which executes and delivers the agreement provided for in\nthis Section 11 or which otherwise becomes bound by all the terms and provisions\nof this Agreement by operation of law.\n\n               (b) This Agreement and all rights of the Executive hereunder\nshall inure to the benefit of and be enforceable by the Executive's personal or\nlegal\n\n\n\n\n                                        14\n\n\n\nrepresentatives, executors, administrators, successors, heirs, distributes,\ndevises and legatees. If the Executive should die while any amounts would still\nbe payable to him hereunder if he had continued to live, all such amounts,\nunless otherwise provided herein, shall be paid in accordance with the terms of\nthis Agreement to the Executive's devisee, legatee, or other designee or, if\nthere be no such designee, to the Executive's estate.\n\n          12. Notice. For the purposes of this Agreement, notices, demands and\nall other communications provided for in this Agreement shall be in writing and\nshall be deemed to have been duly given when delivered or (unless otherwise\nspecified) mailed by United States certified or registered mail, return receipt\nrequested, postage prepaid, address as follows:\n\n          If to the Company:\n\n                       AnnTaylor Stores Corporation\n                       142 West 57th Street\n                       New York, New York 10019\n                       Attn: General Counsel\n\n          With a copy to:\n\n                       Stuart N.  Alperin, Esq.\n                       Skadden, Arps, Slate, Meagher &amp; Flom\n                       919 Third Avenue\n                       New York, New York 10022\n\n          If to the Executive:\n\n                       J. Patrick Spainhour\n                       114 Scarlet Drive\n                       Columbus, Mississippi  39701\n\n          With a copy to:\n\n                       Leon I. Jacobson, Esq.\n                       Jacobson &amp; Mermelstein, P.C.\n                       52 Vanderbilt Avenue\n                       New York, New York 10017\n\nor to such other address as any party may have furnished to the other in writing\nin accordance herewith, except that notices of change of address shall be\neffectively only upon receipt.\n\n\n\n\n                                        15\n\n\n\n          13. Miscellaneous. No provisions of this Agreement may be modified,\nwaived or discharged unless such waiver, modification or discharge is agreed to\nin a writing signed by the Executive and such officer of the company as may be\nspecifically designated by the Board. No Waiver by either party hereto at any\ntime of any breach by the other party hereto of, or compliance with, any\ncondition or provision of this Agreement to be performed by such other party\nshall be deemed a waiver of similar or dissimilar provisions or conditions ate\nthe same or at any prior or subsequent time. No agreements or representations,\noral or otherwise, express or implied, with respect to the subject matter hereof\nhave been made by either party which are not set forth expressly in this\nAgreement. The validity, interpretation, construction and performance of this\nAgreement shall be governed by the laws of the state of New York without regard\nto its conflicts of law principles.\n\n          14. Validity. The invalidity or unenforceability of any provision or\nprovisions of this Agreement shall not affect the validity or enforceability of\nany other provision of this Agreement, which shall remain in full force and\neffect.\n          15. Counterparts. This Agreement may be executed in one or more\ncounterparts and by facsimile signature each of which shall be deemed to be an\noriginal but all of which together will constitute one and the same instrument.\n\n          16. Arbitration. Any dispute or controversy arising under or in\nconnection with this Agreement shall be settled exclusively by arbitration,\nconducted before a panel of three arbitrators in New York City in accordance\nwith the rules of the American Arbitration Association then in effect. Judgement\nmay be entered on the arbitrator's award in any court having jurisdiction;\nprovided that, the Company shall be entitled to seek a restraining order or\ninjunction in any court of competent jurisdiction to prevent any continuation of\nany violation of the provisions of Section 9 of the Agreement during the period\nof Executive's employment or following Executive's termination of employment for\nCause or the voluntary termination of employment by Executive without Good\nReason or of Section 10 of this Agreement at any time, and the Executive hereby\nconsents that such restraining order or injunction may be granted without the\nnecessity of the Company's posting any bond; and further provided that, the\nExecutive shall be entitled to seek specific performance of his right to be paid\nuntil the Date of Termination during the pendency of any dispute or controversy\narising under or in connection with this Agreement. The Company shall pay\ndirectly or reimburse the Executive for any legal fees incurred by Executive in\nconnection with any arbitration related to the last proviso of the preceding\nsentence and any other arbitration in which he prevails.\n\n          17.  Entire Agreement.  This Agreement sets forth the entire\n\n\n\n\n                                        16\n\n\n\nagreement of the parties hereto in respect of the subject matter contained\nherein and supersedes any and all other prior agreements, promises, covenants,\narrangements, communications, representations or warranties, whether oral or\nwritten, by any officer, employee or representative of any party hereto.\n\n                    IN WITNESS WHEREOF, the parties have executed this Agreement\nas of the date and year first above written.\n\n                                           ANNTAYLOR STORES CORPORATION\n\n\n\n                                         By:     \/s\/ Sally Frame Kasaks\n                                             -------------------------------\n                                             Name: Sally Frame Kasaks\n                                             Title: Chairman and Chief\n                                                     Executive Officer\n\n\n                                           EXECUTIVE\n\n\n\n                                                   \/s\/  J. Patrick Spainhour\n                                                   -----------------------------\n                                                        J. Patrick Spainhour\n\n\n\n\n                                        17\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6710],"corporate_contracts_industries":[9494],"corporate_contracts_types":[9539,9544],"class_list":["post-38931","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-anntaylor-stores-corp","corporate_contracts_industries-retail__clothing","corporate_contracts_types-compensation","corporate_contracts_types-compensation__employment"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/38931","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=38931"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=38931"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=38931"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=38931"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}