Exhibit 10.1
AGREEMENT
Agreement made as of the 28th day of May, 2002, between Uni-
Marts, Inc., a Delaware corporation (the "Company"), and ____________
_________(the "Employee").
WHEREAS, the Employee is presently employed by the Company as its
_____________________________________________;
WHEREAS, the Board of Directors of the Company (the "Board")
recognizes that, as is the case with many publicly held
corporations, the possibility of a change in control of the
Company exists and that such possibility, and the uncertainty and
questions which it may raise among employees, may result in the
departure or distraction of key employees to the detriment of the
Company;
WHEREAS, the Board has determined that appropriate steps should
be taken to reinforce and encourage the continued attention and
dedication of key employees of the Company to their assigned
duties without distraction in the face of potentially disturbing
circumstances arising from the possibility of a change in control
of the Company; and
WHEREAS, in order to induce the Employee to remain in the employ
of the Company, the Company agrees that the Employee shall
receive the compensation set forth in this Agreement as a cushion
against the financial and career impact on the Employee in the
event the Employee's employment with the Company is terminated
subsequent to a "Change of Control" (as defined in Section 1
hereof) of the Company;
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements hereinafter set forth and intending to
be legally bound hereby, the parties hereto agree as follows:
1. DEFINITIONS. For all purposes of this Agreement, the following
terms shall have the meanings specified in this Section unless
the context clearly otherwise requires:
(a) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General
Rules and Regulations under the Securities Exchange Act of 1934,
as amended (the "Exchange Act").
(b) "Base Compensation" shall mean the annual base salary that
was received by the Employee in all capacities with the Company,
as reported for Federal income tax purposes on Form W-2, together
with any salary reduction authorized amounts under any of the
Company's benefit plans or programs for the last full fiscal year
of the Company immediately preceding the Change of Control.
(c) "Beneficial Owner" of any securities shall mean:
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(i) that such Person or any of such Person's Affiliates or
Associates, directly or indirectly, 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 (whether or not in writing) or upon the exercise of
conversion rights, exchange rights, rights, warrants or options,
or otherwise; provided, however, that a Person shall not be
deemed the "Beneficial Owner" of securities tendered pursuant to
a tender or exchange offer made by such Person or any of such
Person's Affiliates or Associates until such tendered securities
are accepted for payment, purchase or exchange;
(ii) that such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to vote or
dispose of or has "beneficial ownership" of (as determined
pursuant to Rule 13d-3 of the General Rules and Regulations under
the Exchange Act), including without limitation pursuant to any
agreement, arrangement or understanding, whether or not in
writing; provided, however, that a Person shall not be deemed the
"Beneficial Owner" of any security under this subsection (ii) as
a result of an oral or written agreement, arrangement or
understanding to vote such security if such agreement,
arrangement or understanding (A) arises solely from a revocable
proxy given in response to a public proxy or consent solicitation
made pursuant to, and in accordance with, the applicable
provisions of the General Rules and Regulations under the
Exchange Act, and (B) is not then reportable by such Person on
Schedule 13D under the Exchange Act (or any comparable or
successor report); or
(iii) where voting securities are beneficially owned, directly or
indirectly, by any other Person (or any Affiliate or Associate
thereof) with which such Person (or any of such Person's
Affiliates or Associates) has any agreement, arrangement or
understanding (whether or not in writing) for the purpose of
acquiring, holding, voting (except pursuant to a revocable proxy
as described in the proviso to subsection (ii) above) or
disposing of any voting securities of the Company;
PROVIDED, HOWEVER, that nothing in this subsection (c) shall
cause a Person engaged in business as an underwriter of
securities to be the "Beneficial Owner" of any securities
acquired through such Person's participation in good faith in a
firm commitment underwriting until the expiration of forty days
after the date of such acquisition.
(d) "Change of Control" shall mean:
(i) Any person, entity or "group", within the meaning of Section
13(d) (3) or 14(d) (2) of the Securities Exchange Act of 1934
(the "Exchange Act"). (excluding, for this purpose, (A) the
Company or its subsidiaries, (B) any employee benefit plan of the
Company or its subsidiaries, and (C) Henry Sahakian, Daniel
Sahakian, or their respective families), becomes the Beneficial
Owner of 30% or more of either the then outstanding shares of
common stock or the combined voting power of the Company's then
outstanding voting securities entitled to vote generally in the
election of directors; or
(ii) Individuals who, as of the date of this Agreement,
constitute the Board (the "Incumbent Board") cease for any reason
to constitute at least a majority of the Board,
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provided that any person becoming a director subsequent to the
date of this Agreement whose election, or nomination for election
by the Company's shareholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board
(other than an election or nomination of an individual whose
initial assumption of office is in connection with an actual or
threatened election contest relating to the election of the
Directors of the Company, as such terms are used in Rule 14 a-11
of Regulation 14A promulgated under the Exchange Act) shall be,
for purposes of this Agreement, considered as though such person
were a member of the Incumbent Board; or
(iii) Consummation of (A) a reorganization, merger,
consolidation, in each case, with respect to which persons who
were the stockholders of the Company immediately prior to such
reorganization, merger or consolidation do not, immediately
thereafter, own more than 50% of the combined voting power
entitled to vote generally in the election of directors of the
reorganized, merged or consolidated company's then outstanding
voting securities, or (B) a liquidation or dissolution of the
Company other than through a bankruptcy transaction or
proceeding, or (C) the sale of all or substantially all of the
assets of the Company to a person, entity or group in which Henry
Sahakian, Daniel Sahakian, or their respective families do not
own a majority of the equity.
(e) "Person" shall mean any individual, firm, corporation,
partnership or other entity.
(f) "Subsidiary" shall have the meaning ascribed to such term in
Rule 12b-2 of the General Rules and Regulations under the
Exchange Act.
(g) "Termination Date" shall mean the date of receipt of the
Notice of Termination described in Section 2 hereof or any later
date specified therein, as the case may be.
(h) "Termination of Employment" shall mean the termination of the
Employee's actual employment relationship with the Company.
(i) "Termination following a Change of Control" shall mean a
Termination of Employment within one year after a Change of
Control either:
(i) initiated by the Company for any reason other than (a) the
Employee's continuous illness, injury or incapacity for a period
of six consecutive months or (b) for "cause," which shall mean
misappropriation of funds, habitual insobriety, substance abuse,
conviction of a crime involving moral turpitude, or gross
negligence in the performance of duties, which gross negligence
has had a material adverse effect on the business, operations,
assets, properties or financial condition of the Company and its
Subsidiaries taken as a whole; or
(ii) initiated by the Employee upon one or more of the following
occurrences:
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(A) any failure of the Company to comply with and satisfy any of
the terms of this Agreement;
(B) any change resulting in a significant reduction by the
Company of the authority, duties or responsibilities of the
Employee;
(C) any removal by the Company of the Employee from the
employment grade, compensation level or officer positions which
the Employee holds as of the effective date hereof except in
connection with promotions to higher office;
(D) the requirement that the Employee undertake business travel
(or commuting in excess of fifty miles each way) to an extent
substantially greater than is reasonable and customary for the
position the Employee holds.
2. NOTICE OF TERMINATION. Any Termination following a Change of
Control shall be communicated by a Notice of Termination to the
other party hereto given in accordance with Section 14 hereof.
For purposes of this Agreement, a "Notice of Termination" means a
written notice which (i) indicates the specific termination
provision in this Agreement relied upon, (ii) briefly summarizes
the facts and circumstances deemed to provide a basis for
termination of the Employee's employment under the provision so
indicated, and (iii) if the Termination Date is other than the
date of receipt of such notice, specifies the Termination Date
(which date shall not be more than 15 days after the giving of
such notice).
3. SEVERANCE COMPENSATION UPON TERMINATION. Subject to the
provisions of Section 11 hereof, in the event of the Employee's
Termination following a Change of Control, the Company shall pay
to the Employee, within fifteen days after the Termination Date,
an amount in cash equal to the Employee's Base Compensation.
4. OTHER PAYMENTS. The payment due under Section 3 hereof shall
be in addition to and not in lieu of any payments or benefits due
to the Employee under any other plan, policy or program of the
Company except that no payments shall be due to the Employee
under the Company's then severance pay plan for employees, if
any.
5. ESTABLISHMENT OF TRUST. The Company has established an
irrevocable trust fund (the "Trust Fund") pursuant to a trust
agreement to hold assets contributed to satisfy its obligations
hereunder. Funding of such trust fund shall be subject to the
Company's discretion, as set forth in the agreement pursuant to
which the fund will be established. Notwithstanding the
foregoing:
(i) Upon a Change of Control of the Company, the Chief Financial
Officer of the Company, or his authorized representa-tive
(herein-after referred to collectively as the "Treasurer"), shall
immediately remit to the Trustee of the Trust Fund as a
contribution to the applicable trust estab-lished as part of the
Trust Fund for the bene-fit of the Employee the amount due under
this Agreement and not yet contributed to the Trustee as well as
an amount
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estimated to be sufficient to pay all fees and expenses
that may thereafter become due. The Trustee shall be under no
duty to determine the sufficiency, or to enforce the making, of
such contributions.
(ii) In the event that the Chairman of the Board determines that
a Change of Control of the Company is imminent, the Treasurer
shall make the payments to the Trustee specified in (i). If a
Change of Control of the Company shall not have occurred within
ninety (90) days of the contribu-tions made pursuant to this
Section 5 and the Board adopts a resolution to the effect that,
for purposes of this Agreement, a Change of Con-trol of the
Company is not imminent, any amounts added to the Trust Fund
pursuant to this Sec-tion, together with any earnings there-on,
shall be paid by the Trustee to the Company.
6. ENFORCEMENT.
(a) In the event that the Company shall fail or refuse to make
payment of any amounts due the Employee under Sections 3 and 4
hereof within the respective time periods provided therein, the
Company shall pay to the Employee, in addition to the payment of
any other sums provided in this Agreement, interest, compounded
daily, on any amount remaining unpaid from the date payment is
required under Section 3 and 4, as appropriate, until paid to the
Employee, at the rate from time to time announced by Provident
Bank as its "prime rate" plus 2%, each change in such rate to
take effect on the effective date of the change in such prime
rate.
(b) It is the intent of the parties that the Employee not be
required to incur any expenses associated with the enforcement of
his rights under this Agreement by arbitration, litigation or
other legal action because the cost and expense thereof would
substantially detract from the benefits intended to be extended
to the Employee hereunder. Accordingly, the Company shall pay the
Employee on demand the amount necessary to reimburse the Employee
in full for all expenses (including all attorneys' fees and legal
expenses) incurred by the Employee in enforcing any of the
obligations of the Company under this Agreement.
7. NO MITIGATION. The Employee shall not be required to mitigate
the amount of any payment or benefit provided for in this
Agreement by seeking other employment or otherwise, nor shall the
amount of any payment or benefit provided for herein be reduced
by any compensation earned by other employment or otherwise.
8. NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement shall
prevent or limit the Employee's continuing or future
participation in or rights under any benefit, bonus, incentive or
other plan or program provided by the Company or any of its
Subsidiaries or Affiliates and for which the Employee may
qualify; provided, however, that the Employee hereby waives the
Employee's right to receive any payments under any severance pay
plan or similar program applicable to other employees of the
Company .
9. NO SET-OFF. The Company's obligation to make the payments
provided for in this Agreement and otherwise to perform its
obligations hereunder shall not be affected by
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any circumstances, including, without limitation, any set-off,
counterclaim, recoupment, defense or other right which the Company
may have against the Employee or others.
10. TAXES. Any payment required under this Agreement shall be
subject to all requirements of the law with regard to the
withholding of taxes, filing, making of reports and the like, and
the Company shall use its best efforts to satisfy promptly all
such requirements.
11. TERM OF AGREEMENT. The term of this Agreement shall be for
two years from the date hereof; provided, however, that this
Agreement may be renewed for successive one-year periods if the
Company notifies the Employee in writing that this Agreement will
be so renewed at least sixty days prior to the end of the current
term; provided, however, that (i) after a Change of Control
during the term of this Agreement, this Agreement shall remain in
effect until all of the obligations of the parties hereunder are
satisfied or have expired, and (ii) this Agreement shall
terminate if, prior to a Change of Control, the employment of the
Employee with the Company or any of its Subsidiaries, as the case
may be, shall terminate for any reason, or the Employee shall
cease to be an Employee.
12. SUCCESSOR COMPANY. The Company shall require any successor or
successors (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company, by agreement in form and
substance satisfactory to the Employee, to acknowledge expressly
that this Agreement is binding upon and enforceable against the
Company in accordance with the terms hereof, and to become
jointly and severally obligated with the Company to perform this
Agreement in the same manner and to the same extent that the
Company would be required to perform if no such succession or
successions had taken place. Failure of the Company to obtain
such agreement prior to the effectiveness of any such succession
shall be a breach of this Agreement. As used in this Agreement,
the Company shall mean the Company as hereinbefore defined and
any such successor or successors to its business and/or assets,
jointly and severally.
13. NOTICE. All notices and other communications required or
permitted hereunder or necessary or convenient in connection
herewith shall be in writing and shall be delivered personally or
mailed by registered or certified mail, return receipt requested,
or by overnight express courier service, as follows:
If to the Company, to:
Uni-Marts, Inc.
477 East Beaver Avenue
State College, PA 16801-5690
Attention: Corporate Secretary
If to the Employee, to:
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or to such other names or addresses as the Company or the
Employee, as the case may be, shall designate by notice to the
other party hereto in the manner specified in this Section;
provided, however, that if no such notice is given by the Company
following a Change of Control, notice at the last address of the
Company or to any successor pursuant to Section 12 hereof shall
be deemed sufficient for the purposes hereof. Any such notice
shall be deemed delivered and effective when received in the case
of personal delivery, five days after deposit, postage prepaid,
with the U.S. Postal Service in the case of registered or
certified mail, or on the next business day in the case of
overnight express courier service.
14. GOVERNING LAW. This Agreement shall be governed by and
interpreted under the laws of the Commonwealth of Pennsylvania
without giving effect to any conflict of laws provisions.
15. Contents of Agreement, Amendment and Assignment.
(a) This Agreement supersedes all prior agreements, sets forth
the entire understanding between the parties hereto with respect
to the subject matter hereof and cannot be changed, modified,
extended or terminated except upon written amendment executed by
the Employee and approved by the Board and executed on the
Company's behalf by a duly authorized officer. The provisions of
this Agreement may provide for payments to the Employee under
certain compensation or bonus plans under circumstances where
such plans would not provide for payment thereof. It is the
specific intention of the parties that the provisions of this
Agreement shall supersede any provisions to the contrary in such
plans, and such plans shall be deemed to have been amended to
correspond with this Agreement without further action by the
Company or the Board.
(b) Nothing in this Agreement shall be construed as giving the
Employee any right to be retained in the employ of the Company.
(c) All of the terms and provisions of this Agreement shall be
binding upon and inure to the benefit of and be enforceable by
the respective heirs, representatives, successors and assigns of
the parties hereto, except that the duties and responsibilities
of the Employee and the Company hereunder shall not be assignable
in whole or in part by the Company.
16. SEVERABILITY. If any provision of this Agreement or
application thereof to anyone or under any circumstances shall be
determined to be invalid or unenforceable, such invalidity or
unenforceability shall not affect any other provisions or
applications of this Agreement which can be given effect without
the invalid or unenforceable provision or application.
17. REMEDIES CUMULATIVE; NO WAIVER. No right conferred upon the
Employee by this Agreement is intended to be exclusive of any
other right or remedy, and each and every such right or remedy
shall be cumulative and shall be in addition to any other right
or remedy given hereunder or now or hereafter existing at law or
in equity. No delay or omission by the Employee in exercising any
right, remedy or power hereunder or existing at law or in
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equity shall be construed as a waiver thereof, including, without
limitation, any delay by the Employee in delivering a Notice of
Termination pursuant to Section 2 hereof after an event has
occurred which would, if the Employee had resigned, have
constituted a Termination following a Change of Control pursuant
to Section 1(l)(ii) of this Agreement.
18. MISCELLANEOUS. All section headings are for convenience only.
This Agreement may be executed in several counterparts, each of
which is an original. It shall not be necessary in making proof
of this Agreement or any counterpart hereof to produce or account
for any of the other counterparts.
IN WITNESS WHEREOF, the undersigned, intending to be legally
bound, have executed this Agreement as of the date first above
written.
Attest: UNI-MARTS, INC.
[Seal]
By:
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Assistant Secretary Chairman of the Board and
Chief Executive Officer
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Witness Employee
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