Sample Business Contracts

Severance Agreement - J Crew Operating Corp. and Blair Gordon

Sponsored Links

                                January 30, 2003

Mr. Blair Gordon
359 West 20/th/ Street, #4
New York, NY  10011

Dear Blair:

         This letter will confirm our understanding of the arrangements under
which your Employment Agreement, dated December 12, 2001, with the Company
("Employment Agreement") is terminated. The terms and conditions of the
termination of your employment with the Company are set out below.

           1.   The parties hereby acknowledge and confirm that your employment
                with the Company is terminated effective as of January 30, 2003
                (the "Termination Date").

           2.   Subject to this Agreement becoming effective (as described in
                Paragraph 18 hereof), the Company will continue to pay you your
                base salary of $400,000 per annum for the twelve (12) month
                period beginning on the day immediately following the
                Termination Date ("Severance Period"), payable in accordance
                with the Company's regular payroll practices for its employees.
                You will also continue to have medical coverage during the
                Severance Period on the same terms and conditions as medical
                coverage is then made available to the employees of the Company.
                The foregoing payments shall be reduced by any required tax
                withholdings and shall not be taken into account as compensation
                and no service credit shall be given after the Termination Date
                for purposes of determining the benefits payable under any other
                plan, program, agreement or arrangement of the Company. You
                acknowledge that, except for the foregoing payments, you are not
                entitled to any payment by the Company in the nature of either
                severance or termination pay or other compensation of any kind.

           3.   As of the Termination Date, you have no vested options to
                purchase shares of Common Stock ("Common Stock") of J. Crew
                Group, Inc. ("Parent") and 30,000 unvested options to purchase
                Common Stock at $10.00 per share. You acknowledge that all of
                your unvested options terminate effective immediately, in
                accordance with the provisions of your stock option agreements
                with Parent and the J. Crew Group, Inc. 1997 Stock Option Plan,
                as amended (the "Option Plan").

           4.   By signing this Agreement, you agree that in exchange for the
                consideration set forth herein, you hereby voluntarily, fully
                and unconditionally release and forever discharge the Company,
                Parent, their present and former parent corporation(s),
                subsidiaries, divisions, affiliates and otherwise related
                entities and their respective incumbent and former employees,
                directors, plan administrators, officers and agents,
                individually and in their official capacities (collectively, the
                "Releasees"), from any and all charges, actions, causes of
                action, demands, debts, dues, bonds, accounts, covenants,
                contracts, liabilities, or damages of any


                nature whatsoever, whether now known or claimed, to whomever
                made, which you have or may have against any or all of the
                Releasees for or by reason of any cause, nature or thing
                whatsoever, up to the present time, arising out of or related to
                your employment with the Company or the termination of such
                employment, including, by way of examples and without limiting
                the broadest application of the foregoing, any actions, causes
                of action, or claims under any contract or federal, state or
                local decisional law, statues, regulations or constitutions, any
                claims for notice, pay in lieu of notice, wrongful dismissal,
                breach of contract, defamation or other tortious conduct,
                discrimination on the basis of actual or perceived disability,
                age, sex, race or any other factor (including, without
                limitation, any claim pursuant to Title VII of the Civil Rights
                Act of 1964, Americans with Disabilities Act of 1990, the Age
                Discrimination in Employment Act of 1967, as amended, the Family
                and Medical Act of 1993, the Equal Pay Act of 1963, the Fair
                Labor Standards Act, the State, City and local laws of New York,
                and the equal employment law or laws of the state and/or city in
                which you work), any claim pursuant to any other applicable
                employment standards or human rights legislation or for
                severance pay, salary, bonus, incentive or additional
                compensation, vacation pay, insurance, other benefits, interest,
                and/or attorney's fees. You acknowledge that this general
                release is not made in connection with an exit incentive or
                other employment termination program offered to a group or class
                of employees.

                If you have made or should hereafter make any complaint, charge,
                claim, allegation or demand, or commence or threaten to commence
                any action, complaint, charge, claim or proceeding, against any
                or all of the Releasees for or by reason of any cause, matter or
                thing whatsoever existing up to the present time, this Agreement
                may be raised as and shall constitute a complete bar to any such
                action, complaint, charge, claim, allegation or proceeding, and,
                subject to a favorable ruling by a tribunal of final
                jurisdiction, the Releasees shall recover from you, and you
                shall pay to the Releasees, all costs incurred by them,
                including their attorneys' fees, as a consequence of any such
                action, complaint charge, claim, allegation or proceeding;
                provided, however, that this shall not limit you from enforcing
                your rights under this Agreement, and in the event any action is
                commenced to enforce your rights under this Agreement, each
                party shall bear its own legal fees and expenses; and provided
                further, however, that this is not intended to interfere with
                your right to file a charge with the Equal Employment
                Opportunity Commission ("EEOC") in connection with any claim you
                believe you may have against any Releasee. However, by signing
                this Agreement, you agree to waive any right to recover in any
                proceeding you may bring before the EEOC (or any state human
                rights commission) or in any proceeding brought by the EEOC (or
                any state human rights commission) on your behalf.

                You specifically release all claims under the Age Discrimination
                in Employment Act ("ADEA") relating to your employment and its

           5.   You acknowledge that the payments described in Section 2 above
                that you are receiving in connection with the foregoing release
                are in accordance with your Employment Agreement.



           6.   You hereby agree and acknowledge that you shall be bound by and
                comply with the restrictive covenants provided in Section 4 of
                the Employment Agreement (the "Restrictive Covenants"), and that
                such Restrictive Covenants are hereby made part of this
                Agreement as if specifically restated herein and that the
                payments described in Section 2 above that you are receiving are
                subject to and contingent upon your compliance with Restrictive

           7.   You acknowledge and agree that, notwithstanding any other
                provision of this Agreement, if you breach any of your
                obligations under this Agreement or any Restrictive Covenant,
                (a) you will forfeit your right to receive the payments and
                benefits described in Section 2 above (to the extent the
                payments were not theretofore paid) and the Company shall be
                entitled to recover any payments already made to you or on your
                behalf, (b) the Vested Options shall expire as of the date of
                such breach to the extent not theretofore exercised and, if
                exercised as of the date of such breach, you shall immediately
                reimburse the Company for the profit upon exercise (such profit
                calculated as the difference between the (i) greater of either
                the Fair Market Value (as defined in the Option Plan) of a share
                of Common Stock on the date of exercise or the amount paid by
                the Company to you per share of Common Stock for the purchase of
                the shares acquired upon exercise, and (ii) exercise price,
                times the number of options exercised).

           8.   You hereby agree that the breach of any Restrictive Covenant may
                cause the Company to suffer irreparable harm for which money
                damages would not be an adequate remedy and therefore, if you
                breach a Restrictive Covenant, the Company would be entitled to
                temporary and permanent injunctive relief in any court of
                competent jurisdiction (without the need to post any bond)
                without prejudice to any other remedies under this Agreement or

           9.   You agree that, in the event that you are served with legal
                process or other request purporting to require you to testify,
                plead, respond or defend and/or produce documents at a legal
                proceeding, threatened proceeding, investigation or inquiry
                involving the Releasees, you will: (1) refuse to provide
                testimony or documents absent a subpoena, court order or similar
                process from a regulatory agency: (2) within three (3) business
                days or as soon thereafter as practical, provide oral
                notification to the Company's Executive Vice-President of Human
                Resources of your receipt of such process or request to testify
                or produce documents; and (3) provide to the Company's Executive
                Vice-President of Human Resources by overnight delivery service
                a copy of all legal papers and documents served upon you. You
                further agree that in the event you are served with such
                process, you will meet and confer with the Company's designee(s)
                in advance of giving such testimony or information. You also
                agree to cooperate fully with the Releasees in connection with
                any existing or future litigation against the Releasees, whether
                administrative, civil or criminal in nature, in which and to the
                extent the Releasees deem your cooperation necessary. The
                Company agrees to reimburse you for your reasonable
                out-of-pocket expenses incurred in connection with the
                performance of your obligations under this Section 9.

           10.  This Agreement does not constitute an admission of liability or
                wrongdoing of any kind by you or the Company or its affiliates.



           11.  The terms of this Agreement shall be binding on the parties
                hereto and their respective successors, assigns, heirs and

           12.  This Agreement constitutes the entire understanding of the
                Company and you with respect to the subject matter hereof and
                supersedes all prior understandings, written or oral. The terms
                of this Agreement may be changed, modified or discharged only by
                an instrument in writing signed by the parties hereto. A failure
                of the Company or you to insist on strict compliance with any
                provision of this Agreement shall not be deemed a waiver of such
                provision or any other provision hereof. If any provision of
                this Agreement is determined to be so broad as to be
                unenforceable, such provision shall be interpreted to be only so
                broad as is enforceable.

           13.  This Agreement shall be construed, enforced and interpreted in
                accordance with and governed by the laws of the State of New

           14.  The parties hereto acknowledge and agree that each party has
                reviewed and negotiated the terms and provisions of this
                Agreement and has contributed to its revision. Accordingly, the
                rule of construction to the effect that ambiguities are resolved
                against the drafting party shall not be employed in the
                interpretation of this Agreement. Rather, the terms of this
                Agreement shall be construed fairly as to both parties hereto
                and not in favor or against either party.

           15.  This Agreement may be executed in any number of counterparts and
                by different parties on separate counterparts, each of which
                counterpart, when so executed and delivered, shall be deemed to
                be an original and all of which counterparts, taken together,
                shall constitute but one and the same Agreement.

           16.  You acknowledge that, by your free and voluntary act of signing
                below, you agree to all of the terms of this Agreement and
                intend to be legally bound thereby.

           17.  You acknowledge that you have received this Agreement on or
                before January 30, 2003. You understand that you may consider
                whether to agree to the terms contained herein for a period of
                twenty-one (21) days after the date hereof. However, the
                operation of the provisions of Sections 2 through 4 above may be
                delayed until you execute this Agreement and return it to the
                Company and it becomes effective as provided below. You
                acknowledge that you have consulted with an attorney prior to
                your execution of this Agreement or have determined by your own
                free will not to consult with an attorney.

           18.  This Agreement will become effective, enforceable and
                irrevocable seven days after the date on which it is executed by
                you (the "Effective Date"). During the seven-day period prior to
                the Effective Date, you may revoke your agreement to accept the
                terms hereof by indicating in writing to the Executive
                Vice-President of Human Resources your intention to revoke. If
                you exercise your right to revoke hereunder, you shall forfeit
                your right to receive any of the payments and other benefits
                provided for herein, and to the extent such payments or benefits
                have already been made, you agree that you will immediately
                reimburse the Company for the value of such payments and



        If the foregoing correctly reflects our understanding, please sign the
enclosed copy of this letter agreement, whereupon it will become a binding
agreement between us.

                                                   J. CREW OPERATING CORP.

                                                   By: _________________________
                                                       David F. Kozel
                                                       Executive Vice-President,
                                                       Human Resources

Agreed to and accepted:

   Blair Gordon

Dated: _____________, 2003


STATE OF _________________)


COUNTY OF _______________)

On the __ day of _______, 2003, before me personally came Blair Gordon who,
being by me duly sworn, did depose and say that he resides at
_________________________________, and did acknowledge and represent that he has
had an opportunity to consult with attorneys and other advisers of his choosing
regarding the Agreement set forth above, that he has reviewed all of the terms
of the Agreement and that he fully understands all of its provisions, including
without limitation, the general release and waiver set forth therein.

Notary Public