Exhibit (10)(d)
EMPLOYMENT AGREEMENT
DATED AS OF JANUARY 30, 1994
BETWEEN BERNARD CAMMARATA AND THE TJX COMPANIES, INC.
INDEX PAGE
1. EFFECTIVE DATE; TERM OF AGREEMENT......................... 1
2. SCOPE OF EMPLOYMENT....................................... 1
3. COMPENSATION AND BENEFITS................................. 2
4. SUCCESSION................................................ 6
5. OTHER TERMINATION OF EMPLOYMENT; IN GENERAL............... 7
6. BENEFITS UPON NON-VOLUNTARY TERMINATION OF EMPLOYMENT..... 8
7. TERMINATION FOR CAUSE; VIOLATION OF CERTAIN AGREEMENTS.... 12
8. BENEFITS UPON CHANGE IN CONTROL........................... 12
9. AGREEMENT NOT TO SOLICIT OR COMPETE....................... 12
10. ASSIGNMENT................................................ 14
11. NOTICES................................................... 14
12. WITHHOLDING............................................... 14
13. GOVERNING LAW............................................. 14
14. ARBITRATION............................................... 14
15. ENTIRE AGREEMENT.......................................... 15
EXHIBIT A
Terms of Performance-Based Deferred Stock ("PBDS")........ A-1
EXHIBIT B
Definition Of "Earnings Per Share"........................ B-1
EXHIBIT C
Certain Definitions....................................... C-1
EXHIBIT D
Definition of "Change of Control"......................... D-1
EXHIBIT E
Change Of Control Benefits................................ E-1
BERNARD CAMMARATA
EMPLOYMENT AGREEMENT
AGREEMENT dated as of January 30, 1994 between BERNARD
CAMMARATA of One Thornton Lane, Concord, Massachusetts 01742
("Executive") and The TJX Companies, Inc., a Delaware corporation
whose principal office is in Framingham, Massachusetts 01701.
RECITALS
Executive has been employed by The TJX Companies, Inc. (the
"Company") as its President and Chief Executive Officer pursuant
to an employment agreement dated as of June 1, 1989 and
amendments thereto (the "Prior Agreement"). The Company and
Executive intend that Executive should continue to serve as
President and Chief Executive Officer of the Company and, to that
end, deem it desirable and appropriate to enter into this
Agreement.
AGREEMENT
The parties hereto, in consideration of the mutual
agreements hereinafter contained, agree as follows:
1. EFFECTIVE DATE; TERM OF AGREEMENT. This Agreement shall
become effective as of January 30, 1994 (the "Effective Date")
and, as of that date, shall supersede the Prior Agreement.
Executive's employment shall continue on the terms provided
herein until January 31, 1998 and thereafter until terminated by
either Executive or the Company, subject to earlier termination
as provided herein (such period of employment hereinafter called
the "Employment Period").
2. SCOPE OF EMPLOYMENT.
(a) Nature of Services. Executive shall diligently perform
the duties and assume the responsibilities of President and Chief
Executive Officer of the Company and such additional executive
duties and responsibilities as shall from time to time be
assigned to him by the Board.
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(b) Extent of Services. Except for illnesses and vacation
periods, Executive shall devote substantially all his working
time and attention and his best efforts to the performance of his
duties and responsibilities under this Agreement. However,
Executive may (a) make any passive investments where he is not
obligated or required to, and shall not in fact, devote any
managerial efforts, (b) participate in charitable or community
activities or in trade or professional organizations, or
(c) subject to Board approval (which approval shall not be
unreasonably withheld or withdrawn), hold directorships in public
companies, except only that the Board shall have the right to
limit such services as a director or such participation whenever
the Board shall believe that the time spent on such activities
infringes in any material respect upon the time required by
Executive for the performance of his duties under this Agreement
or is otherwise incompatible with those duties.
3. COMPENSATION AND BENEFITS.
(a) Base Salary. Executive shall be paid a base salary at
the rate hereinafter specified, such Base Salary to be paid in
the same manner and at the same times as the Company shall pay
base salary to other executive employees. The rate at which
Executive's Base Salary shall be paid shall be: (i) for the
period beginning January 30, 1994 and ending May 31, 1995,
$850,000 per year; and (ii) for periods beginning on or after
June 1, 1995, such rate (not less than $850,000 per year) as the
Board may determine.
(b) Existing Awards Under 1986 Stock Incentive Plan
(Including LRPIP). Reference is made to the following awards
previously made to Executive under the Company's 1986 Stock
Incentive Plan (including any successor, the "1986 Plan"),
including awards under the Long Range Performance Incentive Plan:
(i) PARS: The award for 100,000 shares referenced in
Section 3(d) of the Prior Agreement, and the award dated
September 17, 1990;
(ii) Options: Grant Nos. 86-18, 86-21, 86-27
(reflected at Section 3(g) of the Prior Agreement), 86-34,
86-37, 86-40, and 86-42; and
(iii) LRPIP: Awards made prior to the date of this
Agreement under the terms of LRPIP.
Each of the above-referenced awards shall continue for such
period or periods and in accordance with such terms as are set
out in the grant and other governing documents (including for
this purpose the Prior Agreement insofar as it related to any
such awards) relating to such award, and shall not be affected by
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the terms of this Agreement except as otherwise expressly
provided herein.
(c) Awards of Performance-Based Deferred Stock. By written
action taken at its meeting dated March 29, 1994, the Committee
has determined to grant to Executive under the terms of the 1986
Plan 150,000 shares of performance-based deferred stock on the
further terms and conditions set forth in Exhibit A to this
Agreement. This Agreement, including Exhibit A, shall constitute
the Award Agreement in respect of such shares required by the
1986 Plan.
(d) LRPIP. During the Employment Period but subject to
approval by the stockholders of the Company, in accordance with
Section 162(m) of the Code, of the material terms of LRPIP,
Executive will be entitled to participate in annual grants made
under LRPIP. To the extent provided in Section 162(m) of the
Code, the terms of any such award shall be established by the
Committee. Subject to the foregoing, Executive shall be entitled
with respect to each award cycle (beginning with the FYE 1995 to
1997 cycle) to earn up to 70% of his Base Salary as in effect at
the beginning of the cycle if the target established by the
Committee is met and up to 105% of such Base Salary if such
target is exceeded, with the payment potential ranging from 0% to
105% of Executive's Base Salary as established by the terms of
the award.
(e) MIP. During the Employment Period but subject to
approval by the stockholders of the Company, in accordance with
Section 162(m) of the Code, of the material terms of the
Company's Management Incentive Plan ("MIP"), Executive shall be
eligible to receive annual awards under MIP. To the extent
provided in Section 162(m) of the Code, the goals, scope and
conditions of any award shall be established annually by the
Committee. Subject to the foregoing, Executive shall be entitled
to earn up to 50% of his Base Salary if the target established by
the Committee is met and up to 100% of his Base Salary if such
target is exceeded, with the payment potential ranging from 0% to
100% of Executive's Base Salary as established by the terms of
the award.
(f) New Stock Options. The Committee has determined to
grant annually to Executive during the Employment Period,
beginning in 1994, non-statutory stock options under the 1986
Plan (the "Options"). The Options to be granted to Executive for
each such year shall be for not less than 50,000 shares of Stock
(subject to adjustment in accordance with the generally
applicable provisions of the 1986 Plan to reflect any stock
splits, recapitalizations or similar changes), or such larger
number as the Committee may determine. (For 1994 the Option
grant shall be for 75,000 shares of Stock.) The exercise price
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for each such Option shall be the fair market value of the Stock
on the date of grant, as determined by the Committee. Each such
Option shall vest (become exercisable) on a cumulative basis at
the rate of 33-1/3% per year beginning with the first anniversary
of the date of grant of such Option, subject to acceleration in
accordance with the 1986 Plan and this Agreement, and each such
Option shall have a term of ten years, subject to earlier
termination in accordance with the 1986 Plan and this Agreement.
If prior to January 31, 1998 (i) Executive dies or becomes
Disabled, or (ii) a Change of Control occurs while Executive is
employed by the Company, or (iii) Executive voluntarily
terminates the Employment Period for Valid Reason or (iv) his
employment is terminated by the Company other than for Cause,
then all Executive's Options then outstanding shall be
immediately vested. Notwithstanding the foregoing, the Committee
reserves the right to grant to Executive, in lieu of any Options
described in this Section 3(f), shares of Stock having a fair
market value on the date of grant equal to the value of such
Options determined in accordance with the Black-Scholes option
valuation methodology.
If Executive dies or becomes Disabled while employed by the
Company, all his Options shall remain exercisable for a period of
three years, but in no event beyond their original term. Upon
the expiration of such three-year term, the Options shall
terminate. In the event Executive retires under the terms of the
1986 Plan, all his Options shall remain exercisable (to the
extent they were exercisable immediately prior to such
retirement) for a period of three years or, if less, the
remainder of the original option term, and then shall terminate.
Upon any other termination of employment the Options shall remain
exercisable (to the extent they were exercisable immediately
prior to such termination, taking into account any applicable
accelerated vesting as described above) for a period equal to the
lesser of (i) three months, or (ii) the remainder of their
original term, and then shall terminate. However, if Executive
is terminated for Cause all the Options shall immediately
terminate.
(g) SERP. Except as provided in Exhibit E ("Change of
Control Benefits") and this subsection (g), Executive is entitled
to Category B benefits determined and made payable in accordance
with the generally applicable provisions of the Company's
Supplemental Executive Retirement Plan.
(i) Benefits vested to the extent accrued. Subject
to the provisions of Section 7 below, Executive has a fully
vested right to his accrued benefit under SERP based (except
as provided in Exhibit E) on his actual years of service.
Executive shall continue to be fully vested in any future
accruals under SERP.
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(ii) Death benefit. If Executive should die
unmarried during the Employment Period, the Company
shall pay a lump sum death benefit to his designated
beneficiary, or if none to his estate. The lump sum
death benefit payable in accordance with this paragraph
shall be paid as soon as practicable following the date
of Executive's death (the "benefit determination date")
and shall be in lieu of any other death benefit then
payable under SERP. The amount of such lump sum death
benefit shall be determined by assuming that Executive:
(A) was married to a spouse of the same age as
himself;
(B) retired on the benefit determination date and
deferred receipt of his SERP benefit until age 65;
(C) commenced receiving his SERP benefit at age 65
in the form of a reduced joint and survivor annuity
with a 50% continuance to such spouse if she survived
him; and
(D) died immediately after commencement of that
annuity.
The lump sum death benefit described in this subsection (g)
shall be the actuarial present value, determined as of the
benefit determination date, of the hypothetical survivor-
spouse annuity determined in accordance with the assumptions
described in (A) through (D) above. For purposes of making
this actuarial present-value determination, the same
interest rate and mortality assumptions shall be applied as
would apply in determining a Category B SERP participant's
retirement lump sum benefit payable as of the benefit
determination date.
For purposes of this subsection (g), Executive's designated
beneficiary shall be such person (including a trust) as
Executive shall have specified by a written notice delivered
to the Company in accordance with Section 8. Executive may
change his beneficiary designation at any time by a
subsequent written notice delivered in the same manner. If
no beneficiary designation under this subsection (g) is in
effect at the time of Executive's death, the death benefit,
if any, payable under this subsection (g) shall be paid to
Executive's estate.
(h) Qualified Plans. Executive shall be entitled during
the Employment Period to participate in the Company's tax-
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qualified retirement and profit-sharing plans in accordance with
the terms of those plans.
(i) Policies and Fringe Benefits. Executive shall be
subject to Company policies applicable to its executives
generally and shall be entitled to receive all such fringe
benefits as the Company shall from time to time make available to
other executives generally (subject to the terms of any
applicable fringe benefit plan).
4. SUCCESSION. The Company and Executive acknowledge that
given the many years Executive has served as Chief Executive
Officer of the Company and predecessor companies, it is
reasonable to anticipate that at some point in the future, either
within the Employment Period (as it may be extended) or at its
termination, Executive may wish to give up the responsibilities
of Chief Executive Officer to a successor. At that time
Executive may wish either to continue as an employee (other than
President and Chief Executive Officer) of the Company or to
retire fully. If it is determined that Executive will remain as
an employee, the compensation and other terms on which he will do
so will not be governed by this Agreement but will be determined
at that time on a basis that is mutually acceptable to the
parties. If, on the other hand, Executive chooses to retire or
otherwise voluntarily terminate employment, he will be entitled
to the following benefits:
(a) The Company will pay to Executive his then Base
Salary for a period of twelve months from the Date of
Termination, without reduction for compensation earned from
other employment or self-employment.
(b) Until the expiration of the period of Base Salary
payments described in (a) immediately above, except to the
extent that Executive shall obtain the same from another
employer or from self-employment, the Company will provide
such medical and hospital insurance, long-term disability
insurance and term life insurance for Executive and his
family, comparable to the insurance provided for executives
generally, as the Company shall determine, and upon the same
terms and conditions as the same shall be provided for
executives generally; provided, however, that in no event
shall such benefits or the terms and conditions thereof be
less favorable to Executive than those afforded to him as of
the date of termination.
(c) The Company will pay Executive the following,
without offset for compensation earned from other employment
or self-employment:
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First, if not already paid, any amounts to which
Executive is entitled under MIP for the fiscal
year of the Company ended immediately prior to
Executive's termination of employment or under
LRPIP in respect of the three-year Performance
Cycle ended immediately prior his termination of
employment.
Second, an amount equal to the award, if any,
Executive would have earned under MIP for the year
of termination, based on actual performance for
the year and prorated for Executive's period of
service prior to termination. This amount will be
paid at the same time as other MIP awards for the
year of termination are paid.
Third, with respect to the three-year Performance
Cycle ending with the fiscal year of termination
and the next two Performance Cycles, an amount
under LRPIP with respect to each such cycle equal
to the product of (i) 1/36 of the award, if any,
Executive would have earned for such cycle, based
on actual performance, times (ii) the number of
full months in such cycle prior to termination.
The amount payable under the preceding sentence
for any Performance Cycle will be paid at the same
time as other LRPIP awards payable for such cycle.
(e) In addition to the benefits described above,
Executive shall be entitled to such amounts as he shall have
deferred (but not received) under the Company's General
Deferred Compensation Plan in accordance with the provisions
of that Plan. Executive shall also be entitled to the
benefits described in Sections 3(b)(i) (PARS), 3(b)(ii)
(previously granted stock options), 3(c) (Performance-Based
Deferred Stock), 3(f) (New Stock Options), 3(g) (SERP), and
3(h) (Qualified Plans), in each case to the extent, if any,
provided in the provisions of the relevant plan or award
agreement (including the pertinent provisions of this
Agreement) relating to voluntary termination of employment,
including, if Executive's voluntary termination is for Valid
Reason, the accelerated vesting provided in respect of such
a termination under Section 3(f) and Exhibit A.
(f) A Constructive Termination as defined in
subsection 6(a) below shall not be treated as a retirement
or other termination subject to this Section 4.
5. OTHER TERMINATION OF EMPLOYMENT; IN GENERAL.
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(a) The Company shall have the right to end Executive's
employment at any time and for any reason, with or without Cause.
(b) The Employment Period shall terminate when Executive
becomes Disabled. In addition, if by reason of Incapacity
Executive is unable to perform his duties for at least six
continuous months, upon written notice by the Company to
Executive the Employment Period will be terminated for
Incapacity.
(c) Whenever the Employment Period shall terminate,
including by reason of retirement or other voluntary termination
under Section 4 above, Executive shall resign all offices or
other positions he shall hold with the Company and any affiliated
corporations, including any position on the Board; provided, that
if it should be agreed between the Company and Executive that in
connection with termination Executive will continue to serve as
an employee of the Company in another capacity, he shall retain
such offices and positions, if any, as are determined in
connection with such agreement to be consistent with his
continued employee status.
6. BENEFITS UPON NON-VOLUNTARY TERMINATION OF EMPLOYMENT.
(a) Certain Terminations Prior to January 31, 1998. If the
Employment Period shall have terminated prior to January 31, 1998
by reason of (i) death, Disability or Incapacity of Executive,
(ii) termination by the Company for any reason other than Cause
or (iii) termination by Executive in the event that either (A)
Executive shall be removed from or fail to be reelected to the
offices of President, Chief Executive Officer, a Director and a
member of any Executive Committee of the Board or (B) Executive
is relocated more than 40 miles from the current corporate
headquarters of the Company, in either case without his prior
written consent (a "Constructive Termination"), then all
compensation and benefits for Executive shall be as follows:
(i) For the longer of 24 months after such termination
or until January 31, 1998, the Company will pay to Executive
or his legal representative continued Base Salary at the
rate in effect at termination of employment. Base Salary
shall be paid for the first twelve months of the period
without reduction for compensation earned from other
employment or self-employment, and shall thereafter be
reduced by such compensation received by Executive from
other employment or self-employment.
(ii) Until the expiration of the period of Base Salary
payments described in (i) immediately above, except to the
extent that Executive shall obtain the same from another
employer or from self-employment, the Company will provide
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such medical and hospital insurance, long-term disability
insurance and term life insurance for Executive and his
family, comparable to the insurance provided for executives
generally, as the Company shall determine, and upon the same
terms and conditions as the same shall be provided for other
Company executives generally; provided, however, that in no
event shall such benefits or the terms and conditions
thereof be less favorable to Executive than those afforded
to him as of the date of termination.
(iii) The Company will pay to Executive or his legal
representative, without offset for compensation earned from
other employment or self-employment, the following amounts
under the Company's MIP applicable to Executive:
First, if not already paid, any amounts to which
Executive is entitled under MIP for the fiscal
year of the Company ended immediately prior to
Executive's termination of employment. These
amounts will be paid at the same time as other
awards for such prior year are paid.
Second, an amount equal to Executive's MIP Target
Award for the year of termination, prorated for
Executive's period of service during such year
prior to termination. This amount will be paid at
the same time as other MIP awards for the year of
termination are paid.
Third, an amount equal to Executive's MIP Target
Award for the year of termination, without
proration. This amount will be paid at the same
time as the amount payable under the preceding
paragraph.
In addition, the Company will pay to Executive or his legal
representative such amounts as Executive shall have deferred
(but not received) under the Company's General Deferred
Compensation Plan in accordance with the provisions of that
Plan and shall deliver to Executive or his legal
representative any shares of Stock which Executive shall
have earned but deferred in respect of his Performance-Based
Deferred Stock award set forth in Exhibit A.
(iv) Executive or his legal representative shall be
entitled to the benefits described in Sections 3(b)(i)
(PARS), 3(b)(ii) (previously granted stock options), 3(c)
(Performance-Based Deferred Stock), 3(f) (New Stock
Options), 3(g) (SERP), and 3(h) (Qualified Plans). In
addition, with respect to each three-year Performance Cycle
not completed prior to termination, the Company will pay to
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Executive or his legal representative 1/36 of his LRPIP
Target Award for each full month in such cycle prior to
termination. Such amounts will be paid at the same time as
other LRPIP awards payable for the cycle first ending after
termination are paid. Executive or his legal representative
will be entitled to payment (at the same time as other LRPIP
awards for the applicable cycle are paid) of any unpaid
amounts owing with respect to cycles completed prior to
termination.
(v) If termination occurs by reason of Incapacity or
Disability, Executive shall be entitled to such
compensation, if any, as is payable pursuant to the
Company's long-term disability plan or any successor Company
disability plan. Any payments made to Executive under any
long term disability plan of the Company with respect to the
salary continuation period in clause (i) above shall be
offset against such salary continuation payments and to the
extent not so offset, Executive shall promptly make
reimbursement payments to the Company of such disability
payments.
(b) Certain Terminations after January 31, 1998. If the
Employment Period shall have terminated after January 31, 1998 by
reason of (i) death, Disability or Incapacity of Executive, (ii)
termination by the Company for any reason other than Cause or
(iii) termination by Executive in respect of a Constructive
Termination, then all compensation and benefits for Executive
shall be as follows:
(i) The Company will pay to Executive or his legal
representative his then Base Salary for a period of twelve
months from the Date of Termination, without reduction for
compensation earned from other employment or self-
employment.
(ii) Until the expiration of the period of Base Salary
payments described in (i) immediately above, except to the
extent that Executive shall obtain the same from another
employer or from self-employment, the Company will provide
such medical and hospital insurance, long-term disability
insurance and term life insurance for Executive and his
family, comparable to the insurance provided for executives
generally, as the Company shall determine, and upon the same
terms and conditions as the same shall be provided for
executives generally; provided, however, that in no event
shall such benefits or the terms and conditions thereof be
less favorable to Executive than those afforded to him as of
the date of termination.
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(iii) The Company will pay to Executive or his legal
representative, without offset for compensation earned from
other employment or self-employment, the following amounts
under the Company's MIP applicable to Executive:
First, if not already paid, any amounts to which
Executive is entitled under MIP for the fiscal
year of the Company ended immediately prior to
Executive's termination of employment. These
amounts will be paid at the same time as other
awards for such prior year are paid.
Second, an amount equal to Executive's MIP Target
Award for the year of termination, prorated for
Executive's period of service during such year
prior to termination. This amount will be paid at
the same time as other MIP awards for the year of
termination are paid.
Third, an amount equal to Executive's MIP Target
Award for the year of termination, without
proration. This amount will be paid at the same
time as the amount payable under the preceding
paragraph.
In addition, the Company will pay to Executive or his legal
representative such amounts as Executive shall have deferred
(but not received) under the Company's General Deferred
Compensation Plan in accordance with the provisions of that
Plan and shall deliver to Executive or his legal
representative any shares of Stock which Executive shall
have earned but deferred in respect of his Performance-Based
Deferred Stock award set forth in Exhibit A.
(iv) Executive or his legal representative shall also
be entitled to the benefits described in Sections 3(b)(i)
(PARS), 3(b)(ii) (previously granted stock options), 3(c)
(Performance-Based Deferred Stock), 3(f) (New Stock
Options), 3(g) (SERP), and 3(h) (Qualified Plans). In
addition, with respect to each three-year Performance Cycle
not completed prior to termination, the Company will pay to
Executive or his legal representative 1/36 of his LRPIP
Target Award for each month in such cycle prior to
termination. Such amounts will be paid at the same time as
other LRPIP awards payable for the cycle first ending after
termination are paid. Executive or his legal representative
will also be entitled to payment (at the same time as other
LRPIP awards for the applicable cycle are paid) of any
unpaid amounts owing with respect to cycles completed prior
to termination. Executive or his legal representative will
also be entitled to such rights under any PARS, stock option
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and other grants not specifically referred to in Section 3
of this Agreement as shall be provided by the terms of such
other PARS, options and other grants.
(v) If termination occurs by reason of Incapacity or
Disability, Executive shall be entitled to such
compensation, if any, as is payable pursuant to the
Company's long-term disability plan or any successor Company
disability plan. Any payments made to Executive under any
long term disability plan of the Company with respect to the
salary continuation period in clause (i) above shall be
offset against such salary continuation payments and to the
extent not so offset, Executive shall promptly make
reimbursement payments to the Company of such disability
payments.
If the Company determines not to extend the Employment Period
beyond its original term (January 31, 1998) or any extension
thereof, it shall be deemed a termination of the Employment
Period by the Company under this subsection (b). If Executive
should choose not to continue his employment as Chief Executive
Officer of the Company beyond January 31, 1998 or any extension
of the Employment Period (unless such termination constitutes a
Constructive Termination), it shall be deemed a voluntary
termination by Executive and the provisions of Section 4 shall
apply.
7. TERMINATION FOR CAUSE; VIOLATION OF CERTAIN AGREEMENTS.
If the Company should end Executive's employment for Cause, or,
notwithstanding Section 4 and Section 6 above, if Executive
should violate the protected persons or noncompetition provisions
of Section 9, all compensation and benefits otherwise payable
pursuant to this Agreement shall cease, other than (w) such
amounts as Executive shall have deferred (but not received) under
the Company's General Deferred Compensation Plan in accordance
with the provisions of that Plan, (x) any shares which Executive
has earned but deferred in respect of his Performance-Based
Deferred Stock award set forth in Exhibit A, (y) any benefits to
which Executive may be entitled under SERP (provided, that if
Executive should end his employment voluntarily, such benefits
shall be payable only if Executive does not violate the
provisions of Section 9), and (z) benefits, if any, to which
Executive may be entitled under Sections 3(b)(i) (PARS), 3(b)(ii)
(previously granted stock options), 3(f) (New Stock Options), and
3(h) (Qualified Plans). The Company does not waive any rights it
may have for damages or for injunctive relief.
8. BENEFITS UPON CHANGE IN CONTROL. Notwithstanding any
other provision of this Agreement, in the event of a Change of
Control, the determination and payment of any benefits payable
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thereafter with respect to Executive shall be governed
exclusively by the provisions of Exhibit E.
9. AGREEMENT NOT TO SOLICIT OR COMPETE.
(a) Upon the termination of employment at any time, then
for a period of two years after the termination of the Employment
Period, Executive shall not under any circumstances employ,
solicit the employment of, or accept unsolicited the services of,
any "protected person" or recommend the employment of any
"protected person" to any other business organization. A
"protected person" shall be a person known by Executive to be
employed by the Company or its Subsidiaries or to have been
employed by Company or its Subsidiaries within six months prior
to the commencement of conversations with such person with
respect to employment.
As to (i) each "protected person" to whom the foregoing
applies, (ii) each subcategory of "protected person" as defined
above, (iii) each limitation on (A) employment, (B) solicitation
and (C) unsolicited acceptance of services, of each "protected
person" and (iv) each month of the period during which the
provisions of this subsection (a) apply to each of the foregoing,
the provisions set forth in this subsection (a) are deemed to be
separate and independent agreements and in the events of
unenforceability of any such agreement, such unenforceable
agreement shall be deemed automatically deleted from the
provisions hereof and such deletion shall not affect the
enforceability of any other provision of this subsection (a) or
any other term of this Agreement.
(b) During the course of his employment, Executive will
have learned many trade secrets of the Company and will have
access to confidential information and business plans for the
Company. Therefore, if Executive should end his employment
voluntarily at any time, including by reason of retirement or
disability, or if the Company should end Executive's employment
at any time for Cause, then for a period of two years thereafter,
Executive will not engage, either as a principal, employee,
partner, consultant or investor (other than a less-than-1% stock
interest in a corporation), in a business which is a competitor
of the Company. A business shall be deemed a competitor of the
Company if and only if it shall then be so regarded by retailers
generally or if it shall operate a promotional off-price family
apparel store (such as T.J. Maxx or Marshalls) within 10 miles of
any "then existing T.J. Maxx store" or an off-price women's
apparel specialty store (such as Hit or Miss) within five miles
of any "then existing Hit or Miss store" or if it shall at the
termination of the Employment Period operate a catalog business
dealing primarily in off-price women's apparel. The term "then
existing" in the previous sentence shall refer to any such store
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that is, at the time of termination of the Employment Period,
operated by the Company or any wholly-owned subsidiary of the
Company or under lease for operation as aforesaid. Nothing
herein shall restrict the right of Executive to engage in a
business that operates a conventional or full mark-up department
store. Executive agrees that if, at any time, pursuant to action
of any court, administrative or governmental body or other
arbitral tribunal, the operation of any part of this paragraph
shall be determined to be unlawful or otherwise unenforceable,
then the coverage of this paragraph shall be deemed to be
restricted as to duration, geographical scope or otherwise, to
the extent, and only to the extent, necessary to make this
paragraph lawful and enforceable in the particular jurisdiction
in which such determination is made.
(c) If the Employment Period terminates, Executive agrees
(i) to notify the Company immediately upon his securing
employment or becoming self-employed during any period when
Executive's compensation from the Company shall be subject to
reduction or his benefits provided by the Company shall be
subject to termination as provided in Section 6 and (ii) to
furnish to the Company written evidence of his compensation
earned from any such employment or self-employment as the Company
shall from time to time request. In addition, upon termination
of the Employment Period for any reason other than the death of
Executive, Executive shall immediately return all written trade
secrets, confidential information and business plans of the
Company and shall execute a certificate certifying that he has
returned all such items in his possession or under his control.
10. ASSIGNMENT. The rights and obligations of the Company
shall enure to the benefit of and shall be binding upon the
successors and assigns of the Company. The rights and
obligations of Executive are not assignable except only that
payments payable to him after his death shall be made by devise
or descent.
11. NOTICES. All notices and other communications required
hereunder shall be in writing and shall be given by mailing the
same by certified or registered mail, return receipt requested,
postage prepaid. If sent to the Company the same shall be mailed
to the Company at 770 Cochituate Road, Framingham, Massachusetts
01701, Attention: Chairman of the Board of Directors, or other
such address as the Company may hereafter designate by notice to
Executive; and if sent to the Executive, the same shall be mailed
to Executive at One Thornton Lane, Concord, Massachusetts 01742
or at such other address as Executive may hereafter designate by
notice to the Company.
12. WITHHOLDING. Anything to the contrary notwithstanding,
all payments required to be made by the Company hereunder to
-14-
executive shall be subject to the withholding of such amounts, if
any, relating to tax and other payroll deductions as the Company
may reasonably determine it should withhold pursuant to any
applicable law or regulation.
13. GOVERNING LAW. This Agreement and the rights and
obligations of the parties hereunder shall be governed by the
laws of the Commonwealth of Massachusetts.
14. ARBITRATION. In the event that there is any claim or
dispute arising out of or relating to this Agreement, or the
breach thereof, and the parties hereto shall not have resolved
such claim or dispute within 60 days after written notice from
one party to the other setting forth the nature of such claim or
dispute, then such claim or dispute shall be settled exclusively
by binding arbitration in Boston, Massachusetts in accordance
with the Commercial Arbitration Rules of the American Arbitration
Association by an arbitrator mutually agreed upon by the parties
hereto or, in the absence of such agreement, by an arbitrator
selected according to such Rules. Notwithstanding the foregoing,
if either the Company or Executive shall request, such
arbitration shall be conducted by a panel of three arbitrators,
one selected by the Company, one selected by Executive and the
third selected by agreement of the first two, or, in the absence
of such agreement, in accordance with such Rules. Judgment upon
the award rendered by such arbitrator(s) shall be entered in any
Court having jurisdiction thereof upon the application of either
party.
15. ENTIRE AGREEMENT. This Agreement, including Exhibits,
represents the entire agreement between the parties relating to
the terms of Executive's employment by the Company and supersedes
all prior written or oral agreements between them.
/s/ Bernard Cammarata
Executive
THE TJX COMPANIES, INC.
By /s/ Sumner Feldberg
Chairman of the Board
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EXHIBIT A
Terms of Performance-Based Deferred Stock ("PBDS")
PBDS are shares of Stock to be delivered in the future upon
certification by the Committee that specified predetermined
performance goals have been met. The terms of the PBDS award to
Executive are set forth below:
A.1. Number of shares. The maximum number of shares of
Stock available to be earned is 150,000. All share numbers shown
in this Exhibit A, including the 150,000 maximum, are subject to
adjustment in accordance with the generally applicable provisions
of the 1986 Plan to reflect any stock splits, recapitalizations
or similar changes.
A.2. Performance Terms. Shares of PBDS will be transferred
to Executive based on certification by the Committee that certain
growth in earnings per share from continuing operations (EPS)
targets have been met, as follows:
(a) If EPS for any of FYE 1995, 1996, 1997 or 1998
(each, a "performance year") is equal to or less than one
hundred ten (110.00%) percent of "test-year EPS" as
hereinafter defined, Executive shall not be entitled to
receive any shares in respect of the performance year except
as hereinafter provided. As used herein when testing
performance for any performance year, "test-year EPS" means
EPS for the fiscal year for which EPS was highest out of all
fiscal years ending on or after January 29, 1994 and before
the performance year.
(b) If EPS for any performance year is equal to or
greater than one hundred fifteen (115.00%) percent of test-
year EPS, Executive shall be entitled to receive 37,500
shares.
(c) If EPS for any performance year is greater than
one hundred ten (110.00%) percent, but less than one hundred
fifteen (115.00%) percent, of test-year EPS, Executive shall
be entitled to receive a number of shares equal to 37,500
multiplied by a fraction, the numerator of which is (i) the
ratio of EPS for the performance year to test-year EPS,
expressed as a percentage, less (ii) one hundred ten
(110.00%) percent, and the denominator of which is five
(5.00%) percent.
(d) If as of the end of any performance year, growth
in EPS equals or exceeds fifteen (15.00%) percent on a
cumulative compound basis, treating EPS for the fiscal year
ended January 29, 1994 as the base line, then Executive
shall be entitled to receive 37,500 shares for that
performance year in lieu of the number determined under (a),
(b), or (c) above.
(e) If as of the end of the fiscal year ending
January 31, 1998, growth in EPS exceeds ten (10.00%) percent
on a cumulative compound basis, treating EPS for the fiscal
year ended January 29, 1994 as the base line, then Executive
shall be entitled to receive an additional number of shares
equal to the product of (i) the excess, if any, of 150,000
shares over the aggregate number of shares which Executive
has earned under paragraphs (a) through (d) above,
inclusive, times (ii) the applicable percentage determined
in accordance with the following table:
EPS Cumulative Applicable
Compound Growth Percentage
Rate
> 12.50% 100.0%
12.00% 80.0%
11.50% 60.0%
11.00% 40.0%
10.50% 20.0%
< 10.00% 0.0%
Applicable percentage rates are to be interpolated for rates
of cumulative compound EPS growth between those shown on the
table.
A.3. Termination of Employment, Etc.. Executive will be
entitled to shares of PBDS also in the following circumstances
and to the extent determined under this Section A.3.
(a) If prior to the end of any fiscal year in the
Employment Period the Company terminates the Employment
Period other than for Cause, or Executive terminates the
Employment Period for Valid Reason, Executive will be
entitled for such year to 37,500 shares multiplied by a
fraction, the numerator of which is the number of months in
such year prior to termination and the denominator of which
is twelve. Shares to which Executive may become entitled
under this paragraph shall be in lieu of any shares for the
same year determined under Section A.2. above.
(b) If Executive dies, becomes Disabled, or is
terminated for Incapacity during any fiscal year in the
Employment Period, he (or his beneficiary) will be entitled
to a number of shares equal to 75,000 shares per year
A - 2
determined on a cumulative basis beginning with the fiscal
year ending January 28, 1995, prorated for the year of
reference to reflect the number of months preceding his
death, Disability or Incapacity; provided, that in no event
shall Executive (or his beneficiary) become entitled to more
than 150,000 shares under the award set forth in this
Exhibit A.
(c) If, prior to January 31, 1998, a Change of Control
occurs while Executive is employed by the Company, Executive
shall become immediately entitled to any and all of the
150,000 shares of PBDS awarded hereunder which he had not
already earned under the preceding provisions of this
Exhibit A. All such shares, together with any previously
earned shares that had been deferred by Executive, shall be
transferred to Executive immediately prior to the Change in
Control.
Except as provided in this Section A.3. or in Section A.2.,
Executive shall not be entitled to any shares pursuant to the
award set forth in this Exhibit A.
A.4. Transfer of Shares. As soon as practicable following
certification by the Committee of achievement of the performance
targets specified in Section A.2. above, or following the
occurrence of an event described in Section A.3. above, the
Company shall transfer to Executive shares of Stock equal to the
number of shares of PBDS earned by Executive in respect of such
performance or event; provided, that the shares of Stock to which
Executive becomes entitled upon a Change of Control, if any, will
be transferred to Executive immediately prior to the Change in
Control; and further provided, that in the case of any shares of
Stock deferred under Section A.8 below, the Company shall
transfer such shares to Executive only upon expiration of the
deferral period.
A.5. Forfeiture. Upon termination of Executive's
employment under circumstances described in Section 4 (other than
termination for Valid Reason) or Section 7 of the Agreement,
Executive shall forfeit any and all rights to any shares of PBDS
not previously earned under Sections A.2. or A.3. above, unless
the Committee determines otherwise.
A.6. Voting. Executive shall be entitled to vote only
those shares of PBDS that have actually been transferred to him.
A.7. Dividends. Neither dividends nor amounts in lieu of
dividends shall be paid to Executive prior to the time shares of
PBDS are actually transferred to him. However, the Company shall
accrue a dividend equivalent with respect to all 150,000 shares
(the "base shares") which are the subject of this award, taking
A - 3
into account dividends payable with respect to record dates on or
after March 29, 1994. The maximum aggregate dividend equivalent
so accrued shall not exceed $438,000 plus the amount of any
extraordinary dividends declared during the accrual period. The
accrued dividend equivalent with respect to the base shares shall
be paid in cash to Executive at the same time, and subject to the
same conditions, as the base shares to which they relate; and if
Executive under Section A.5. above forfeits the opportunity to
earn any base shares he shall likewise be deemed to have
forfeited any right to the dividend equivalents accrued with
respect to those base shares. If Executive elects to defer any
base shares under Section A.8. below, there shall likewise be
deferred the dividend equivalents relating to those base shares.
No dividend with respect to any base share shall accrue as to any
dividend record date occurring on or after the date the share is
transferred to Executive under A.4. above.
A.8. Deferral. Subject to such reasonable limitations and
restrictions as the Committee may determine in order to comply
with Section 162(m) of the Code, and on such other terms as may
be mutually acceptable to Executive and the Committee, Executive
may, prior to earning any shares described in Section A.2., A.3.,
or A.7. above, elect irrevocably to defer the receipt of any such
shares so earned (and any associated dividend equivalents) for a
specified period or until the occurrence of a specified event.
A.9. Table Illustrating Cumulative Compound Growth Rates in
EPS. Attached as a Schedule to this Exhibit A is an illustration
of 10.00%, 12.50% and 15.00% cumulative compound growth rates in
EPS for the period through the end of the fiscal year ended
January 31, 1998, based on EPS for the fiscal year ended January
29, 1994 of $1.616.
A - 4
Schedule to Exhibit A
Bernard Cammarata
Cumulative Compound Growth
over a $1.616 Base Amount for FYE 1994
10.00% Compound 12.50% Compound 15.00% Compound
Growth Rate Growth Rate Growth Rate
Annual Cumulative Annual Cumulative Annual Cumulative
FYE EPS EPS EPS EPS EPS EPS
1/95 1.778 1.818 1.858
1/96 1.955 3.733 2.045 3.863 2.137 3.995
1/97 2.151 5.884 2.301 6.164 2.458 6.453
1/98 2.366 8.250 2.589 8.753 2.826 9.279
Note: Interim performance levels over 10.00% will result in interpolation
based on the above.
EXHIBIT B
Definition of "Earnings Per Share"
(a) Earnings Per Share ("EPS") shall mean post-tax earnings
per common share from continuing operations for the applicable
fiscal year determined on a fully diluted basis as reported in
the Company's annual consolidated financial statements but
expressed to three decimal places ("post-tax earnings per share
from continuing operations"), adjusted as hereinafter described.
The fiscal year ended January 29, 1994 shall be the Base Year for
EPS calculations. For the avoidance of doubt, "post-tax earnings
per share from continuing operations" for the fiscal year ended
January 29, 1994 shall be determined without regard to the
cumulative effect of accounting changes under FAS 106 and FAS
109.
(b) If any of the following events occurs after January 29,
1994, then in each fiscal year in which any such event directly
affects post-tax earnings per share from continuing operations by
more than $0.01, including the Base Year, a corresponding
adjustment shall be made to arrive at EPS for such year. For
purposes of the preceding sentence, changes that are integrally
related shall be taken into account as a single change. Changes
that are not integrally related shall be tested separately to
determine whether any of them, individually, directly affects
post-tax earnings per share from continuing operations by more
than $0.01. An adjustment in EPS pursuant to this subsection
shall not affect the number of shares of PBDS earned for fiscal
years ended prior to the year in which the event giving rise to
the adjustment occurs (even though EPS for such prior years may
be altered by the adjustment) but shall be taken into account in
determining the number of shares of PBDS earned in the fiscal
year in which the event giving rise to the adjustment occurs and
subsequent fiscal years.
Any common stock split or common stock dividend,
common stock subdivision or reclassification.
Any change in accounting principles or Company
accounting practices.
Any change in laws (including tax laws and statutory
rates), regulations or interpretations thereof.
Any extraordinary item, determined under generally
accepted accounting principles.
Any new item of income or expense resulting from
previously discontinued operations.
(c) The foregoing adjustments are intended to be
objectively determinable and nondiscretionary and as such
consistent with qualification of awards as performance-based
under Section 162(m) of the Internal Revenue Code, and shall be
construed accordingly. The Committee retains the right to make
such other adjustments as it deems necessary to avoid undue
hardship or windfall to Executive; provided, that the Committee
shall be deemed to have retained such a right only to the extent
retention of the right would not be deemed to cause the PBDS
award granted under Exhibit A to fail to qualify as an exempt
performance-based award under said Section 162(m).
B - 2
EXHIBIT C
Certain Definitions
In this Agreement, the following terms shall have the following
meanings:
(a) "Base Salary" means, for any period, the amount
described in Section 3(a).
(b) "Board" means the Board of Directors of the
Company.
(c) "Committee" means the Executive Compensation
Committee of the Board.
(d) "Cause" means dishonesty by Executive in the
performance of his duties, conviction of a felony (other
than a conviction arising solely under a statutory provision
imposing criminal liability upon Executive on a per se basis
due to the Company offices held by Executive, so long as any
act or omission of Executive with respect to such matter was
not taken or omitted in contravention of any applicable
policy or directive of the Board), gross neglect of duties
(other than as a result of Disability or death), or conflict
of interest which conflict shall continue for 30 days after
the Company gives written notice to Executive requesting the
cessation of such conflict.
In respect of any termination during a Standstill
Period, Executive shall not be deemed to have been
terminated for Cause until the later to occur of (i) the
30th day after notice of termination is given and (ii) the
delivery to Executive of a copy of a resolution duly adopted
by the affirmative vote of not less than a majority of the
Company's directors at a meeting called and held for that
purpose (after reasonable notice to Executive), and at which
Executive together with his counsel was given an opportunity
to be heard, finding that the Executive was guilty of
conduct described in the definition of "Cause" above, and
specifying the particulars thereof in detail; provided,
however, that the Company may suspend Executive and withhold
payment of his Base Salary from the date that notice of
termination is given until the earliest to occur of
(A) termination of Executive for Cause (in which case
Executive shall not be entitled to his Base Salary for such
period), (B) a determination by a majority of the Company's
directors that Executive was not guilty of the conduct
described in the definition of "Cause" above (in which case
Executive shall be reinstated and paid any of his previously
unpaid Base Salary for such period), or (C) 90 days after
notice of termination is given (in which case Executive
shall then be reinstated and paid any of his previously
unpaid Base Salary for such period). If Base Salary is
withheld and then paid pursuant to clauses (B) and (C) of
the preceding sentence, the amount thereof shall be
accompanied by simple interest, calculated on a daily basis,
at a rate per annum equal to the prime or base lending rate,
as in effect at the time, of the Company's principal
commercial bank.
(e) "Change of Control" has the meaning given it in
Exhibit D.
(f) "Change of Control Termination" means the
termination of Executive's employment during a Standstill
Period (1) by the Company other than for Cause, or (2) by
Executive for good reason, or (3) by reason of death,
Incapacity or Disability.
For purposes of this definition, termination for "good
reason" shall mean the voluntary termination by Executive of
his employment (A) within 120 days after the occurrence
without Executive's express written consent of any one of
the events described in clauses (I), (II), (III), (IV), (V)
or (VI) below, provided that Executive gives notice to the
Company at least 30 days in advance requesting that the
pertinent situation described therein be remedied, and the
situation remains unremedied upon expiration of such 30-day
period; (B) within 120 days after the occurrence without
Executive's express written consent of the event described
in clause (VII), provided that Executive gives notice to the
Company at least 30 days in advance of his intent to
terminate his employment in respect of such event; or (C)
under the circumstances described in clause (VIII) below,
provided that Executive gives notice to the Company at least
30 days in advance:
(I) the assignment to him of any duties inconsistent
with his positions, duties, responsibilities,
reporting requirements, and status with the
Company immediately prior to the Change of
Control, or any removal of Executive from or any
failure to reelect him to such positions, except
in connection with the termination of Executive's
employment by the Company for Cause or by
Executive other than for good reason, or any other
action by the Company which results in a
diminishment in such position, authority, duties
or responsibilities, other than an insubstantial
and inadvertent action which is remedied by the
Company promptly after receipt of notice thereof
given by Executive; or
(II) if Executive's rate of Base Salary for any fiscal
year is less than 100 percent of the rate of Base
Salary paid to Executive in the completed fiscal
C - 2
year immediately preceding the Change of Control;
or if Executive's total cash compensation
opportunities, including salary and incentives,
for any fiscal year are less than 100 percent of
the total cash compensation opportunities made
available to Executive in the completed fiscal
year immediately preceding the Change of Control;
or
(III) the failure of the Company to continue in effect
any benefits or perquisites, or any pension, life
insurance, medical insurance or disability plan in
which Executive was participating immediately
prior to the Change of Control unless the Company
provides Executive with a plan or plans that
provide substantially similar benefits, or the
taking of any action by the Company that would
adversely affect Executive's benefits under any of
such plans or deprive Executive of any material
fringe benefit enjoyed by Executive immediately
prior to the Change of Control; or
(IV) any purported termination of Executive's
employment by the Company for Cause during a
Standstill Period which is not effected in
compliance with paragraph (d) above; or
(V) any relocation of Executive of more than 40 miles
from the place where Executive was located at the
time of the Change of Control; or
(VI) any other breach by the Company of any provision
of this Agreement; or
(VII) the Company sells or otherwise disposes of, in one
transaction or a series of related transactions,
assets or earning power aggregating more than 30
percent of the assets (taken at asset value as
stated on the books of the Company determined in
accordance with generally accepted accounting
principles consistently applied) or earning power
of the Company (on an individual basis) or the
Company and its Subsidiaries (on a consolidated
basis) to any other Person or Persons (as those
terms are defined in
Exhibit D); or
(VIII) The voluntary termination by Executive of his
employment (i) at any time within one year after
the Change of Control or (ii) at any time during
the second year after the Change of Control unless
the Company offers Executive an employment
contract extending at least to January 30, 1999
but having a minimum two-year duration. Such
C - 3
contract must provide Executive with substantially
the same title, responsibilities, annual and long-
range compensation, benefits and perquisites that
he had immediately prior to the Standstill Period.
Notwithstanding the foregoing, the Board may
expressly waive the application of this clause
(VIII) if it waives the applicability of
substantially similar provisions with respect to
all persons with whom the Company has a written
severance agreement (or may condition its
application on any additional requirements or
employee agreements which the Board shall in its
discretion deem appropriate in the circumstances).
The determination of whether to waive or impose
conditions on the application of this clause
(VIII) shall be within the complete discretion of
the Board but shall be made prior to the Change of
Control.
(g) "Date of Termination" means the date on which
Executive's employment terminates.
(h) "Disability" has the meaning given it in the
Company's long-term disability plan. Executive's employment
shall be deemed to be terminated for Disability on the date
on which Executive is entitled to receive long-term
disability compensation pursuant to such long-term
disability plan.
(i) "Earnings Per Share" or "EPS" has the meaning
given it in Exhibit B.
(j) "Incapacity" means a disability (other than
Disability within the meaning of (h) above) or other
impairment of health that renders Executive unable to
perform his duties to the reasonable satisfaction of the
Committee.
(k) "Standstill Period" means the period commencing on
the date of a Change of Control and continuing until the
close of business on the last business day of the 24th
calendar month following such Change of Control.
(l) "Stock" means the common stock, $1.00 par value,
of the Company.
(m) "Subsidiary" means any corporation in which the
Company owns, directly or indirectly, 50 percent or more of
the total combined voting power of all classes of stock.
(n) "Valid Reason" means the voluntary termination by
Executive of his employment (A) within 120 days after the
occurrence without Executive's express written consent of
any one of the events described in clauses (I), (II), (III),
C - 4
(IV), or (V) below, provided that Executive gives notice to
the Company at least 30 days in advance requesting that the
pertinent situation described therein be remedied, and the
situation remains unremedied upon expiration of such 30-day
period; or (B) within 120 days after the occurrence without
Executive's express written consent of the event described
in clause (VI) below:
(I) the assignment to him of any duties inconsistent
with his positions, duties, responsibilities,
reporting requirements, and status with the
Company immediately prior to such assignment, or a
substantive change in Executive's titles or
offices as in effect immediately prior to such
assignment, or any removal of Executive from or
any failure to reelect him to such positions,
except in connection with the termination of
Executive's employment by the Company for Cause or
by Executive other than for Valid Reason, or any
other action by the Company which results in a
diminishment in such position, authority, duties
or responsibilities, other than an insubstantial
and inadvertent action which is remedied by the
Company promptly after receipt of notice thereof
given by Executive; or
(II) the failure of the Company to continue in effect
any benefits or perquisites, or any pension, life
insurance, medical insurance or disability plan in
which Executive was participating immediately
prior to such failure unless the Company provides
Executive with a plan or plans that provide
substantially similar benefits, or the taking of
any action by the Company that would adversely
affect Executive's benefits under any of such
plans or deprive Executive of any material fringe
benefit enjoyed by Executive immediately prior to
such action, unless the elimination or reduction
of any such benefit, perquisite or plan affects
all other executives in the same organizational
level (it being the Company's burden to establish
this fact); or
(III) any purported termination of Executive's
employment by the Company for Cause which is not
effected in compliance with paragraph (d) above;
or
(IV) any relocation of Executive of more than 40 miles
from the place where Executive was located at the
time of such relocation; or
(V) any other breach by the Company of any provision
of this Agreement; or
C - 5
(VI) the Company sells or otherwise disposes of, in one
transaction or a series of related transactions,
assets or earning power aggregating more than 30
percent of the assets (taken at asset value as
stated on the books of the Company determined in
accordance with generally accepted accounting
principles consistently applied) or earning power
of the Company (on an individual basis) or the
Company and its Subsidiaries (on a consolidated
basis) to any other Person or Persons (as those
terms are defined in Exhibit D).
C - 6
EXHIBIT D
Definition of "Change of Control"
"Change of Control" shall mean the occurrence of any one of
the following events:
(a) there occurs a change of control of the Company of
a nature that would be required to be reported in response
to Item 1(a) of the Current Report on Form 8-K pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934
(the "Exchange Act") or in any other filing under the
Exchange Act; provided, however, that no transaction shall
be deemed to be a Change of Control (i) if the person or
each member of a group of persons acquiring control is
excluded from the definition of the term "Person" hereunder
or (ii) unless the Committee shall otherwise determine prior
to such occurrence, if Executive or an Executive Related
Party is the Person or a member of a group constituting the
Person acquiring control; or
(b) any Person other than the Company, any wholly-
owned subsidiary of the Company, or any employee benefit
plan of the Company or such a subsidiary becomes the owner
of 20% or more of the Company's Common Stock and thereafter
individuals who were not directors of the Company prior to
the date such Person became a 20% owner are elected as
directors pursuant to an arrangement or understanding with,
or upon the request of or nomination by, such Person and
constitute at least 1/4 of the Company's Board of Directors;
provided, however, that unless the Committee shall otherwise
determine prior to the acquisition of such 20% ownership,
such acquisition of ownership shall not constitute a Change
of Control if Executive or an Executive Related Party is the
Person or a member of a group constituting the Person
acquiring such ownership; or
(c) there occurs any solicitation or series of
solicitations of proxies by or on behalf of any Person other
than the Company's Board of Directors and thereafter
individuals who were not directors of the Company prior to
the commencement of such solicitation or series of
solicitations are elected as directors pursuant to an
arrangement or understanding with, or upon the request of or
nomination by, such Person and constitute at least 1/4 of
the Company's Board of Directors; or
(d) the Company executes an agreement of acquisition,
merger or consolidation which contemplates that (i) after
the effective date provided for in the agreement, all or
substantially all of the business and/or assets of the
Company shall be owned, leased or otherwise controlled by
another Person and (ii) individuals who are directors of the
Company when such agreement is executed shall not constitute
a majority of the board of directors of the survivor or
successor entity immediately after the effective date
provided for in such agreement; provided, however, that
unless otherwise determined by the Committee, no transaction
shall constitute a Change of Control if, immediately after
such transaction, Executive or any Executive Related Party
shall own equity securities of any surviving corporation
("Surviving Entity") having a fair value as a percentage of
the fair value of the equity securities of such Surviving
Entity greater than 125% of the fair value of the equity
securities of the Company owned by Executive and any
Executive Related Party immediately prior to such
transaction, expressed as a percentage of the fair value of
all equity securities of the Company immediately prior to
such transaction (for purposes of this paragraph ownership
of equity securities shall be determined in the same manner
as ownership of Common Stock); and provided, further, that,
for purposes of this paragraph (d), if such agreement
requires as a condition precedent approval by the Company's
shareholders of the agreement or transaction, a Change of
Control shall not be deemed to have taken place unless and
until such approval is secured (but upon any such approval,
a Change of Control shall be deemed to have occurred on the
date of execution of such agreement).
In addition, for purposes of this Exhibit D the following terms
have the meanings set forth below:
"Common Stock" shall mean the then outstanding Common Stock
of the Company plus, for purposes of determining the stock
ownership of any Person, the number of unissued shares of Common
Stock which such Person has the right to acquire (whether such
right is exercisable immediately or only after the passage of
time) upon the exercise of conversion rights, exchange rights,
warrants or options or otherwise. Notwithstanding the foregoing,
the term Common Stock shall not include shares of Preferred Stock
or convertible debt or options or warrants to acquire shares of
Common Stock (including any shares of Common Stock issued or
issuable upon the conversion or exercise thereof) to the extent
that the Board of Directors of the Company shall expressly so
determine in any future transaction or transactions.
A Person shall be deemed to be the "owner" of any Common
Stock:
(i) of which such Person would be the "beneficial
owner," as such term is defined in Rule 13d-3 promulgated by
the Securities and Exchange Commission (the "Commission")
under the Exchange Act, as in effect on March 1, 1989; or
(ii) of which such Person would be the "beneficial
owner" for purposes of Section 16 of the Exchange Act and
D - 2
the rules of the Commission promulgated thereunder, as in
effect on March 1, 1989; or
(iii) which such Person or any of its affiliates or
associates (as such terms are defined in Rule 12b-2
promulgated by the Commission under the Exchange Act, as in
effect on March 1, 1989), has the right to acquire (whether
such right is exercisable immediately or only after the
passage of time) pursuant to any agreement, arrangement or
understanding or upon the exercise of conversion rights,
exchange rights, warrants or options or otherwise.
"Person" shall have the meaning used in Section 13(d) of the
Exchange Act, as in effect on March 1, 1989; provided, however,
that "Person" shall not include (a) any individuals who are
descendants of Max Feldberg or Morris Feldberg, the founders of
the Company, (b) any relatives of the fourth degree of
consanguinity or closer of such descendants, or (c) custodians,
trustees or legal representatives of such persons.
An "Executive Related Party" shall mean any affiliate or
associate of Executive other than the Company or a majority-owned
subsidiary of the Company. The terms "affiliate" and "associate"
shall have the meanings ascribed thereto in Rule 12b-2 under the
Exchange Act (the term "registrant" in the definition of
"associate" meaning, in this case, the Company).
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EXHIBIT E
Change of Control Benefits
E.1. Benefits Upon a Change of Control Termination.
(a) The Company shall pay the following to Executive in a
lump sum within 30 days following a Change of Control
Termination:
(i) an amount equal to two times his Base Salary for
one year at the rate in effect immediately prior to the Date
of Termination or the Change of Control, whichever is
higher, plus the accrued and unpaid portion of his Base
Salary through the Date of Termination. Any payments made
to Executive under any long term disability plan of the
Company with respect to the two years following termination
of employment shall be offset against such two times Base
Salary payment. Executive shall promptly make reimbursement
payments to the Company to the extent any such disability
payments are received after the Base Salary payment.
(ii) in lieu of any other benefits under SERP, an
amount equal to the present value of the payments that
Executive would have been entitled to receive under SERP as
a Category B participant, applying the following rules and
assumptions:
(A) a credit equal to the number of Years of Service
(as that term is defined in SERP) that Executive has
been employed by the Company or a predecessor at the
Date of Termination shall be added to his Years of
Service in determining Executive's total Years of
Service; provided, however, that the total Years of
Service determined hereunder shall not exceed the
lesser of (x) 20 or (y) the Years of Service that
Executive would have had if he had retired at the age
of 65;
(B) Executive's Average Compensation (as that term is
defined in SERP) shall be determined as of the Date of
Termination;
(C) Executive's Primary Social Security Benefit (as
that term is defined in SERP) shall mean the annual
primary insurance amount to which the Executive is
entitled or would, upon application therefor, become
entitled at age 65 under the provisions of the Federal
Social Security Act as in effect on the Date of
Termination assuming that Executive received annual
income at the rate of his Base Salary from the Date of
Termination until his 65th birthdate which would be
treated as wages for purposes of the Social Security
Act;
(D) the monthly benefit under SERP determined using the
foregoing criteria shall be multiplied by 12 to
determine an annual benefit; and
(E) the present value of such annual benefit shall be
determined by multiplying the result in (D) by the
appropriate actuarial factor, using the most recently
published interest and mortality rates published by the
Pension Benefit Guaranty Corporation which are
effective for plan terminations occurring on the Date
of Termination, using Executive's age to the nearest
year determined as of that date. If, as of the Date of
Termination, the Executive has previously satisfied the
eligibility requirements for Early Retirement under The
TJX Companies, Inc. Retirement Plan, then the
appropriate factor shall be that based on the most
recently published "PBGC Actuarial Value of $1.00 Per
Year Deferred to Age 60 and Payable for Life Thereafter
-- Healthy Lives," except that if the Executive's age
to the nearest year is more than 60, then such higher
age shall be substituted for 60. If, as of the Date of
Termination, the Executive has not satisfied the
eligibility requirements for Early Retirement under The
TJX Companies, Inc. Retirement Plan, then the
appropriate factor shall be based on the most recently
published "PBGC Actuarial Value of $1.00 Per Year
Deferred To Age 65 And Payable For Life Thereafter --
Healthy Lives."
(F) the benefit determined under (E) above shall be
reduced by the value of any portion of Executive's SERP
benefit already paid or provided to him in cash or
through the transfer of an annuity contract.
(b) Until the second anniversary of the Date of Termination,
the Company shall maintain in full force and effect for the
continued benefit of Executive and his family all life insurance,
medical insurance and disability plans and programs in which
Executive was entitled to participate immediately prior to the
Change of Control, provided that Executive's continued
participation is possible under the general terms and provisions
of such plans and programs. In the event that Executive is
ineligible to participate in such plans or programs, the Company
shall arrange upon comparable terms to provide Executive with
benefits substantially similar to those which he is entitled to
receive under such plans and programs. Notwithstanding the
foregoing, the Company's obligations hereunder with respect to
life, medical or disability coverage or benefits shall be deemed
satisfied to the extent (but only to the extent) of any such
coverage or benefits provided by another employer.
E - 2
(c) For a period of two years after the Date of Termination,
the Company shall make available to Executive the use of any
automobile that was made available to Executive prior to the Date
of Termination, including ordinary replacement thereof in
accordance with the Company's automobile policy in effect
immediately prior to the Change of Control (or, in lieu of making
such automobile available, the Company may at its option pay to
Executive the present value of its cost of providing such
automobile).
E.2. Incentive Benefits Upon a Change of Control. Within
30 days following a Change of Control, whether or not Executive's
employment has terminated or been terminated, the Company shall
pay to the Executive the following in a lump sum:
(i) an amount equal to the "Target Award" under the
Company's Management Incentive Plan or any other annual
incentive plan which is applicable to Executive for the
fiscal year in which the Change of Control occurs. In
addition the Company will pay to Executive an amount equal
to such Target Award prorated for the period of active
employment during such fiscal year through the Change of
Control; and
(ii) for Performance Cycles not completed prior to the
Change of Control, an amount with respect to each such cycle
equal to the maximum Award under LRPIP specified for
Executive for such cycle, unless Executive shall already
have received payment of such amounts. Executive shall also
be entitled to payment of any unpaid amounts owing with
respect to cycles completed prior to the Change of Control.
E.3. Payments under Section E.1. and Section E.2. of this
Exhibit shall be made without regard to whether the deductibility
of such payments (or any other payments to or for the benefit of
Executive) would be limited or precluded by Internal Revenue Code
Section 280G and without regard to whether such payments (or any
other payments) would subject Executive to the federal excise tax
levied on certain "excess parachute payments" under Internal
Revenue Code Section 4999; provided, that if the total of all
payments to or for the benefit of Executive, after reduction for
all federal taxes (including the tax described in Internal
Revenue Code Section 4999, if applicable) with respect to such
payments ("Executive's total after-tax payments"), would be
increased by the limitation or elimination of any payment under
Section E.1. or Section E.2., amounts payable under Section E.1.
and Section E.2. shall be reduced to the extent, and only to the
extent, necessary to maximize Executive's total after-tax
payments. The determination as to whether and to what extent
payments under Section E.1. or Section E.2. are required to be
reduced in accordance with the preceding sentence shall be made
at the Company's expense by Coopers & Lybrand or by such other
certified public accounting firm as the Committee may designate
prior to a Change of Control. In the event of any underpayment
E - 3
or overpayment under Section E.1. or Section E.2., as determined
by Coopers & Lybrand (or such other firm as may have been
designated in accordance with the preceding sentence), the amount
of such underpayment or overpayment shall forthwith be paid to
Executive or refunded to the Company, as the case may be, with
interest at the applicable Federal rate provided for in Section
7872(f)(2) of the Internal Revenue Code.
E.4. Other Benefits. In addition to the amounts described
in Sections E.1. and E.2., Executive shall be entitled to his
benefits, if any, under Sections 3(b)(i) (PARS), 3(b)(ii)
(previously granted stock options), 3(c) (Performance-Based
Deferred Stock), 3(f) (New Stock Options), and 3(h) (Qualified
Plans).
5. Noncompetition; No Mitigation of Damages; etc.
(a) Noncompetition. Upon a Change of Control, any
agreement by Executive not to engage in competition with the
Company subsequent to the termination of his employment,
whether contained in an employment contract or other
agreement, shall no longer be effective.
(b) No Duty to Mitigate Damages. Executive's benefits
under this Exhibit E shall be considered severance pay in
consideration of his past service and his continued service
from the date of this Agreement, and his entitlement thereto
shall neither be governed by any duty to mitigate his
damages by seeking further employment nor offset by any
compensation which he may receive from future employment.
(c) Legal Fees and Expenses. The Company shall pay
all legal fees and expenses, including but not limited to
counsel fees, stenographer fees, printing costs, etc.
reasonably incurred by Executive in contesting or disputing
that the termination of his employment during a Standstill
Period is for Cause or other than for good reason (as
defined in the definition of Change of Control Termination)
or obtaining any right or benefit to which Executive is
entitled under this Agreement following a Change of Control.
Any amount payable under this Agreement that is not paid
when due shall accrue interest at the prime rate as from
time to time in effect at the First National Bank of Boston,
until paid in full.
(e) Notice of Termination. During a Standstill
Period, executive's employment may be terminated by the
Company only upon 30 days' written notice to Executive.
E - 4