Exhibit 10.1

 

AMENDED AND RESTATED CHANGE IN CONTROL SEVERANCE AGREEMENT

 

THIS AMENDED AND RESTATED CHANGE IN CONTROL SEVERANCE AGREEMENT (the
“Agreement”) dated as of January 27, 2006, is made by and between The J. Jill
Group, Inc., a Delaware corporation (“J. Jill”; J. Jill and its Subsidiaries
being hereafter referred to as the “Company”), and Gordon R. Cooke (the
“Executive”).

 

WHEREAS, the Company and the Executive are parties to a Change In Control
Severance Agreement dated December 21, 2005 (the “Prior Agreement”) and now
desire to amend and restate the Prior Agreement in its entirety; and

 

WHEREAS the Company considers it essential to the best interests of its
stockholders to foster the continuous employment of key management personnel;
and

 

WHEREAS the Board of Directors of J. Jill recognizes that, as is the case with
many publicly held corporations, the possibility of a Change in Control (as
defined in the last Section hereof) exists and that such possibility, and the
uncertainty and questions which it may raise among management, may result in the
departure or distraction of management personnel to the detriment of the Company
and its stockholders; and

 

WHEREAS the Board has determined that appropriate steps should be taken to
reinforce and encourage the continued attention and dedication of members of the
Company’s management, including the Executive, to their assigned duties without
distraction in the face of potentially disturbing circumstances arising from the
possibility of a Change in Control;

 

NOW THEREFORE, in consideration of the promises and the mutual covenants herein
contained, the Company and the Executive hereby agree as follows:

 

1.             DEFINED TERMS. THE DEFINITION OF CAPITALIZED TERMS USED IN THIS
AGREEMENT IS PROVIDED IN THE LAST SECTION HEREOF.

 

2.             TERM OF AGREEMENT. THIS AGREEMENT SHALL COMMENCE ON THE DATE
HEREOF AND SHALL CONTINUE IN EFFECT THROUGH DECEMBER 31, 2006; PROVIDED,
HOWEVER, THAT COMMENCING ON JANUARY 1, 2007 AND EACH JANUARY 1 THEREAFTER, THE
TERM OF THIS AGREEMENT SHALL AUTOMATICALLY BE EXTENDED FOR ONE ADDITIONAL YEAR
UNLESS, NOT LATER THAN DECEMBER 1 OF THE PRECEDING YEAR, THE COMPANY OR THE
EXECUTIVE SHALL HAVE GIVEN NOTICE NOT TO EXTEND THIS AGREEMENT OR A CHANGE IN
CONTROL SHALL HAVE OCCURRED PRIOR TO SUCH JANUARY 1; PROVIDED, HOWEVER, IF A
CHANGE IN CONTROL SHALL HAVE OCCURRED DURING THE TERM OF THIS AGREEMENT, THIS
AGREEMENT SHALL CONTINUE IN EFFECT FOR A PERIOD OF NOT LESS THAN TWENTY-FOUR
(24) MONTHS BEYOND THE MONTH IN WHICH SUCH CHANGE IN CONTROL OCCURRED.

 

3.             COMPANY’S COVENANTS SUMMARIZED.  IN ORDER TO INDUCE THE EXECUTIVE
TO REMAIN IN THE EMPLOY OF THE COMPANY AND IN CONSIDERATION OF THE EXECUTIVE’S
COVENANTS SET FORTH IN SECTION 4 HEREOF, THE COMPANY AGREES, UNDER THE
CONDITIONS DESCRIBED HEREIN, TO PAY THE EXECUTIVE THE SEVERANCE PAYMENTS AND THE
OTHER PAYMENTS AND BENEFITS DESCRIBED HEREIN IN THE EVENT THE EXECUTIVE’S
EMPLOYMENT WITH THE COMPANY IS TERMINATED FOLLOWING A CHANGE IN CONTROL AND
DURING THE TERM OF THIS AGREEMENT. NO AMOUNT OR BENEFIT SHALL BE PAYABLE UNDER
THIS AGREEMENT UNLESS THERE SHALL HAVE BEEN (OR, UNDER THE TERMS HEREOF, THERE
SHALL BE DEEMED TO

 

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HAVE BEEN) A TERMINATION OF THE EXECUTIVE’S EMPLOYMENT WITH THE COMPANY
FOLLOWING A CHANGE IN CONTROL. THIS AGREEMENT SHALL NOT BE CONSTRUED AS CREATING
AN EXPRESS OR IMPLIED CONTRACT OF EMPLOYMENT AND, EXCEPT AS OTHERWISE AGREED IN
WRITING BETWEEN THE EXECUTIVE AND THE COMPANY, THE EXECUTIVE SHALL NOT HAVE ANY
RIGHT TO BE RETAINED IN THE EMPLOY OF THE COMPANY.

 

4.             THE EXECUTIVE’S COVENANTS.

 

4.1           THE EXECUTIVE AGREES THAT, SUBJECT TO THE TERMS AND CONDITIONS OF
THIS AGREEMENT, IN THE EVENT OF A POTENTIAL CHANGE IN CONTROL DURING THE TERM OF
THIS AGREEMENT, THE EXECUTIVE WILL REMAIN IN THE EMPLOY OF THE COMPANY UNTIL THE
EARLIEST OF (I) A DATE WHICH IS SIX (6) MONTHS FROM THE DATE OF SUCH POTENTIAL
CHANGE OF CONTROL, (II) THE DATE OF A CHANGE IN CONTROL, (III) THE DATE OF
TERMINATION BY THE EXECUTIVE OF THE EXECUTIVE’S EMPLOYMENT FOR GOOD REASON
(DETERMINED BY TREATING THE POTENTIAL CHANGE IN CONTROL AS A CHANGE IN CONTROL
IN APPLYING THE DEFINITION OF GOOD REASON), OR BY REASON OF DEATH, DISABILITY OR
RETIREMENT, OR (IV) THE TERMINATION BY THE COMPANY OF THE EXECUTIVE’S EMPLOYMENT
FOR ANY REASON.

 

4.2           THE EXECUTIVE AGREES THAT, DURING THE EXECUTIVE’S EMPLOYMENT WITH
THE COMPANY AND FOR A PERIOD OF ONE YEAR AFTER THE TERMINATION OF THE
EXECUTIVE’S EMPLOYMENT WITH THE COMPANY FOR ANY REASON, THE EXECUTIVE WILL NOT
DIRECTLY OR INDIRECTLY SOLICIT, ATTEMPT TO HIRE, OR HIRE ANY EMPLOYEE OF THE
COMPANY (OR ANY PERSON WHO MAY HAVE BEEN EMPLOYED BY THE COMPANY DURING THE LAST
YEAR OF THE TERM OF THE EXECUTIVE’S EMPLOYMENT WITH THE COMPANY), OR ASSIST IN
SUCH HIRING BY ANY OTHER PERSON OR BUSINESS ENTITY OR ENCOURAGE, INDUCE OR
ATTEMPT TO INDUCE ANY SUCH EMPLOYEE TO TERMINATE HIS OR HER EMPLOYMENT WITH THE
COMPANY.

 

5.             COMPENSATION OTHER THAN SEVERANCE PAYMENTS.

 

5.1           FOLLOWING A CHANGE IN CONTROL AND DURING THE TERM OF THIS
AGREEMENT, DURING ANY PERIOD THAT THE EXECUTIVE FAILS TO PERFORM THE EXECUTIVE’S
FULL-TIME DUTIES WITH THE COMPANY AS A RESULT OF INCAPACITY DUE TO PHYSICAL OR
MENTAL ILLNESS, THE COMPANY SHALL PAY THE EXECUTIVE’S FULL SALARY TO THE
EXECUTIVE AT THE RATE IN EFFECT AT THE COMMENCEMENT OF ANY SUCH PERIOD, TOGETHER
WITH ALL COMPENSATION AND BENEFITS PAYABLE TO THE EXECUTIVE UNDER THE TERMS OF
ANY COMPENSATION OR BENEFIT PLAN, PROGRAM OR ARRANGEMENT MAINTAINED BY THE
COMPANY DURING SUCH PERIOD, UNTIL THE EXECUTIVE’S EMPLOYMENT IS TERMINATED BY
THE COMPANY FOR DISABILITY.

 

5.2           IF THE EXECUTIVE’S EMPLOYMENT SHALL BE TERMINATED FOR ANY REASON
FOLLOWING A CHANGE IN CONTROL AND DURING THE TERM OF THIS AGREEMENT, THE COMPANY
SHALL PAY THE EXECUTIVE’S FULL SALARY TO THE EXECUTIVE THROUGH THE DATE OF
TERMINATION AT THE RATE IN EFFECT AT THE TIME THE NOTICE OF TERMINATION IS
GIVEN, TOGETHER WITH ALL COMPENSATION AND BENEFITS PAYABLE TO THE EXECUTIVE
THROUGH THE DATE OF TERMINATION UNDER THE TERMS OF ANY COMPENSATION OR BENEFIT
PLAN, PROGRAM OR ARRANGEMENT MAINTAINED BY THE COMPANY DURING SUCH PERIOD.

 

5.3           IF THE EXECUTIVE’S EMPLOYMENT SHALL BE TERMINATED FOR ANY REASON
FOLLOWING A CHANGE IN CONTROL AND DURING THE TERM OF THIS AGREEMENT, THE COMPANY
SHALL PAY TO THE EXECUTIVE ANY SUCH POST-TERMINATION COMPENSATION AND BENEFITS
AS ARE DUE TO THE EXECUTIVE UNDER ANY APPLICABLE SEPARATION, SEVERANCE OR
EMPLOYMENT AGREEMENT BETWEEN THE COMPANY AND THE EXECUTIVE (“POST-TERMINATION
PAYMENTS”) AS SUCH PAYMENTS BECOME DUE; PROVIDED THAT IN NO

 

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EVENT SHALL ANY POST-TERMINATION PAYMENTS BE PAID IF THE EXECUTIVE IS ENTITLED
TO THE SEVERANCE PAYMENTS (AS DEFINED IN SECTION 6.1) AS A RESULT OF SUCH
TERMINATION.

 

6.             SEVERANCE PAYMENTS.

 

6.1           IF THE EXECUTIVE’S EMPLOYMENT IS TERMINATED FOLLOWING A CHANGE IN
CONTROL AND DURING THE TERM OF THIS AGREEMENT, UNLESS SUCH TERMINATION IS (I) BY
THE COMPANY FOR CAUSE, (II) BY REASON OF DEATH OR DISABILITY OR (III) BY THE
EXECUTIVE WITHOUT GOOD REASON, AND PROVIDED THAT THE SEVEN-DAY REVOCATION PERIOD
DESCRIBED IN SECTION 6.6 HAS EXPIRED WITHOUT REVOCATION OF THE RELEASE AND
WAIVER BY THE EXECUTIVE, THE COMPANY SHALL PAY THE EXECUTIVE THE PAYMENTS
DESCRIBED IN THIS SECTION 6.1 (THE “SEVERANCE PAYMENTS”) IN ADDITION TO THE
PAYMENTS AND BENEFITS DESCRIBED IN SECTIONS 5.1 AND 5.2 HEREOF (BUT NOT
SECTION 5.3 HEREOF).  THE EXECUTIVE’S EMPLOYMENT SHALL BE DEEMED TO HAVE BEEN
TERMINATED FOLLOWING A CHANGE IN CONTROL BY THE COMPANY WITHOUT CAUSE OR BY THE
EXECUTIVE WITH GOOD REASON IF THE EXECUTIVE’S EMPLOYMENT IS TERMINATED PRIOR TO
A CHANGE IN CONTROL WITHOUT CAUSE AT THE DIRECTION OF A PERSON WHO HAS ENTERED
INTO AN AGREEMENT WITH THE COMPANY THE CONSUMMATION OF WHICH WILL CONSTITUTE A
CHANGE IN CONTROL OR IF THE EXECUTIVE TERMINATES HIS EMPLOYMENT WITH GOOD REASON
PRIOR TO A CHANGE IN CONTROL (DETERMINED BY TREATING A POTENTIAL CHANGE IN
CONTROL AS A CHANGE IN CONTROL IN APPLYING THE DEFINITION OF GOOD REASON) IF THE
CIRCUMSTANCE OR EVENT WHICH CONSTITUTES GOOD REASON OCCURS AT THE DIRECTION OF
SUCH PERSON.

 

(A)          IN LIEU OF ANY FURTHER SALARY PAYMENTS TO THE EXECUTIVE FOR PERIODS
SUBSEQUENT TO THE DATE OF TERMINATION AND IN LIEU OF ANY SEVERANCE BENEFIT
OTHERWISE PAYABLE TO THE EXECUTIVE, THE COMPANY SHALL PAY TO THE EXECUTIVE A
LUMP SUM SEVERANCE PAYMENT, IN CASH, EQUAL TO (I) TWO TIMES THE EXECUTIVE’S
ANNUAL BASE SALARY AS APPROVED BY THE COMPENSATION COMMITTEE OF THE BOARD TO BE
PAID TO THE EXECUTIVE (OR, IF THE EXECUTIVE’S ANNUAL BASE SALARY IS NOT
PRESENTED FOR APPROVAL AT THE COMPENSATION COMMITTEE LEVEL, THEN AS OTHERWISE
ESTABLISHED BY J. JILL OR ONE OF ITS SUBSIDIARIES) WITH RESPECT TO THE YEAR IN
WHICH THE DATE OF TERMINATION OCCURS, PLUS (II) TWO TIMES THE MAXIMUM BONUS
AMOUNT PAYABLE TO THE EXECUTIVE UNDER ALL BONUS PLANS WITH RESPECT TO THE YEAR
(OR ANY PORTION THEREOF) IN WHICH THE DATE OF TERMINATION OCCURS, TREATING ANY
AND ALL PERFORMANCE GOALS UNDER SUCH BONUS PLANS AS HAVING BEEN MET.

 

(B)           NOTWITHSTANDING ANY PROVISION OF ANY BONUS PLAN, THE COMPANY SHALL
PAY TO THE EXECUTIVE A LUMP SUM AMOUNT, IN CASH, EQUAL TO THE SUM OF (I) ANY
INCENTIVE COMPENSATION WHICH HAS BEEN ALLOCATED OR AWARDED TO THE EXECUTIVE FOR
A COMPLETED YEAR OR OTHER MEASURING PERIOD PRECEDING THE DATE OF TERMINATION
UNDER ANY SUCH BONUS PLAN BUT HAS NOT YET BEEN PAID (PURSUANT TO SECTION 5.2
HEREOF OR OTHERWISE), AND (II) A PRO RATA PORTION TO THE DATE OF TERMINATION OF
THE MAXIMUM BONUS AMOUNT PAYABLE TO THE EXECUTIVE UNDER ALL BONUS PLANS WITH
RESPECT TO THE YEAR (OR ANY PORTION THEREOF) IN WHICH THE DATE OF TERMINATION
OCCURS, TREATING ANY AND ALL PERFORMANCE GOALS UNDER SUCH BONUS PLANS AS HAVING
BEEN MET AND CALCULATED BY MULTIPLYING SUCH MAXIMUM BONUS AMOUNT BY A FRACTION,
THE NUMERATOR OF WHICH IS THE NUMBER OF DAYS IN SUCH YEAR (OR PORTION THEREOF)
WHICH ELAPSED TO THE DATE OF TERMINATION AND THE DENOMINATOR OF WHICH IS THE
NUMBER OF DAYS IN SUCH YEAR (OR PORTION THEREOF).

 

(C)           FOR A TWENTY-FOUR (24) MONTH PERIOD AFTER THE DATE OF TERMINATION,
THE COMPANY SHALL ARRANGE TO PROVIDE THE EXECUTIVE WITH LIFE, DISABILITY,
ACCIDENT AND HEALTH INSURANCE BENEFITS SUBSTANTIALLY SIMILAR TO THE LIFE,
DISABILITY, ACCIDENT AND HEALTH INSURANCE

 

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BENEFITS WHICH THE EXECUTIVE IS RECEIVING IMMEDIATELY PRIOR TO THE NOTICE OF
TERMINATION (WITHOUT GIVING EFFECT TO ANY REDUCTION IN SUCH BENEFITS SUBSEQUENT
TO A CHANGE IN CONTROL WHICH REDUCTION CONSTITUTES GOOD REASON).  BENEFITS
OTHERWISE RECEIVABLE BY THE EXECUTIVE PURSUANT TO THIS SECTION 6.1(C) SHALL BE
REDUCED TO THE EXTENT COMPARABLE BENEFITS ARE ACTUALLY RECEIVED BY OR MADE
AVAILABLE TO THE EXECUTIVE WITHOUT COST DURING THE TWENTY-FOUR (24) MONTH PERIOD
FOLLOWING THE EXECUTIVE’S TERMINATION OF EMPLOYMENT (AND ANY SUCH BENEFITS
ACTUALLY RECEIVED BY THE EXECUTIVE SHALL BE REPORTED TO THE COMPANY BY THE
EXECUTIVE).

 

6.2           THE PAYMENTS PROVIDED FOR IN SECTION 6.1 (OTHER THAN
SECTION 6.1(C)) HEREOF SHALL BE MADE NOT LATER THAN THE FIFTH (5TH) DAY
FOLLOWING THE EXPIRATION OF THE SEVEN-DAY REVOCATION PERIOD DESCRIBED IN
SECTION 6.6 WITHOUT REVOCATION OF THE RELEASE AND WAIVER BY THE EXECUTIVE,
UNLESS THE COMPANY DETERMINES IN GOOD FAITH THAT SUCH PAYMENTS ARE REQUIRED TO
BE DELAYED FOR A PERIOD OF SIX (6) MONTHS IN ORDER TO SATISFY THE REQUIREMENTS
OF INTERNAL REVENUE CODE §409A(A)(2)(B)(I), IN WHICH CASE THE COMPANY SHALL SO
ADVISE THE EXECUTIVE, AND SUCH PAYMENTS SHALL BE MADE ON THE EARLIER OF (I) SIX
(6) MONTHS AFTER THE DATE OF TERMINATION OR (II) THE DEATH OF THE EXECUTIVE.

 

6.3           IF THE EXECUTIVE’S EMPLOYMENT IS TERMINATED FOLLOWING A CHANGE IN
CONTROL AND DURING THE TERM OF THIS AGREEMENT, UNLESS SUCH TERMINATION IS (I) BY
THE COMPANY FOR CAUSE, (II) BY REASON OF DEATH OR DISABILITY OR (III) BY THE
EXECUTIVE WITHOUT GOOD REASON, ALL OUTSTANDING STOCK OPTIONS HELD BY THE
EXECUTIVE FOR THE PURCHASE OF SHARES OF COMMON STOCK OF J. JILL SHALL
IMMEDIATELY BECOME VESTED IN FULL.  THE EXECUTIVE AGREES NOT TO EXERCISE THE
PORTION OF SUCH STOCK OPTIONS FOR WHICH VESTING HAS BEEN ACCELERATED UNTIL THE
SEVEN-DAY REVOCATION PERIOD DESCRIBED IN SECTION 6.6 HAS EXPIRED WITHOUT
REVOCATION OF THE RELEASE AND WAIVER BY THE EXECUTIVE, AND ANY SUCH EXERCISE
BEFORE THE SEVEN-DAY REVOCATION PERIOD HAS EXPIRED WITHOUT REVOCATION OF THE
RELEASE AND WAIVER BY THE EXECUTIVE SHALL BE NULL AND VOID.  THE EXECUTIVE’S
EMPLOYMENT SHALL BE DEEMED TO HAVE BEEN TERMINATED FOLLOWING A CHANGE IN CONTROL
BY THE COMPANY WITHOUT CAUSE OR BY THE EXECUTIVE WITH GOOD REASON IF THE
EXECUTIVE’S EMPLOYMENT IS TERMINATED PRIOR TO A CHANGE IN CONTROL WITHOUT CAUSE
AT THE DIRECTION OF A PERSON WHO HAS ENTERED INTO AN AGREEMENT WITH THE COMPANY
THE CONSUMMATION OF WHICH WILL CONSTITUTE A CHANGE IN CONTROL OR IF THE
EXECUTIVE TERMINATES HIS EMPLOYMENT WITH GOOD REASON PRIOR TO A CHANGE IN
CONTROL (DETERMINED BY TREATING A POTENTIAL CHANGE IN CONTROL AS A CHANGE IN
CONTROL IN APPLYING THE DEFINITION OF GOOD REASON) IF THE CIRCUMSTANCE OR EVENT
WHICH CONSTITUTES GOOD REASON OCCURS AT THE DIRECTION OF SUCH PERSON.

 

6.4           (I)            IF ANY PAYMENT OR BENEFIT MADE AVAILABLE TO THE
EXECUTIVE IN CONNECTION WITH A CHANGE IN CONTROL (INCLUDING, WITHOUT LIMITATION,
ANY PAYMENT MADE PURSUANT TO ANY LONG-TERM INCENTIVE PLANS, STOCK OPTION OR
EQUITY PARTICIPATION RIGHT PLANS) OR TERMINATION OF THE EXECUTIVE’S EMPLOYMENT
FOLLOWING A CHANGE IN CONTROL (IN EITHER CATEGORY, A “CHANGE IN CONTROL
PAYMENT”) IS SUBJECT TO THE EXCISE TAX (AS HEREINAFTER DEFINED), THE COMPANY
SHALL PAY TO THE EXECUTIVE ADDITIONAL AMOUNTS (THE “GROSS UP AMOUNTS”) SUCH THAT
THE TOTAL AMOUNT OF ALL CHANGE IN CONTROL PAYMENTS NET OF THE EXCISE TAX SHALL
EQUAL THE TOTAL AMOUNT OF ALL CHANGE IN CONTROL PAYMENTS TO WHICH THE EXECUTIVE
WOULD HAVE BEEN ENTITLED IF THE EXCISE TAX HAD NOT BEEN IMPOSED. FOR PURPOSES OF
THIS SECTION 6.4, THE TERM “EXCISE TAX” SHALL MEAN THE TAX IMPOSED BY
SECTION 4999 OF THE CODE AND ANY SIMILAR TAX THAT MAY HEREAFTER BE IMPOSED.

 

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(II)           THE GROSS UP AMOUNTS DUE TO THE EXECUTIVE UNDER THIS SECTION 6.4
SHALL BE ESTIMATED BY A NATIONALLY RECOGNIZED FIRM OF CERTIFIED PUBLIC
ACCOUNTANTS SELECTED BY THE INDIVIDUAL HOLDING THE POSITION OF CHIEF FINANCIAL
OFFICER OF THE COMPANY IMMEDIATELY BEFORE THE CHANGE IN CONTROL OR SUCH
OFFICER’S DESIGNEE, AT ANY TIME THAT THE EXECUTIVE IS TO RECEIVE A CHANGE IN
CONTROL PAYMENT.  THE GROSS UP AMOUNTS WILL BE BASED UPON THE FOLLOWING
ASSUMPTIONS:

 

(A)          ALL CHANGE IN CONTROL PAYMENTS SHALL BE DEEMED TO BE “PARACHUTE
PAYMENTS” WITHIN THE MEANING OF SECTION 280G(B)(2) OF THE CODE, AND ALL “EXCESS
PARACHUTE PAYMENTS” SHALL BE DEEMED TO BE SUBJECT TO THE EXCISE TAX EXCEPT TO
THE EXTENT THAT, IN THE OPINION OF THE CERTIFIED PUBLIC ACCOUNTANTS CHARGED WITH
ESTIMATING THE GROSS UP AMOUNTS FOR THE EXECUTIVE UNDER THIS SECTION 6.4, SUCH
CHANGE IN CONTROL PAYMENTS ARE NOT SUBJECT TO THE EXCISE TAX; AND

 

(B)           THE EXECUTIVE SHALL BE DEEMED TO PAY FEDERAL, STATE AND LOCAL
TAXES AT THE HIGHEST MARGINAL RATE OF TAXATION FOR THE APPLICABLE CALENDAR YEAR.

 

(III)          THE ESTIMATED GROSS UP AMOUNT DUE THE EXECUTIVE WITH RESPECT TO
ANY CHANGE IN CONTROL PAYMENT PURSUANT TO THIS SECTION 6.4 SHALL BE PAID TO THE
EXECUTIVE IN A LUMP SUM NOT LATER THAN THIRTY (30) BUSINESS DAYS AFTER SUCH
CHANGE IN CONTROL PAYMENT IS PROVIDED TO THE EXECUTIVE.  IN THE EVENT THAT THE
GROSS UP AMOUNT IS LESS THAN THE AMOUNT ACTUALLY DUE TO THE EXECUTIVE UNDER THIS
SECTION 6.4, THE AMOUNT OF ANY SUCH SHORTFALL SHALL BE PAID TO THE EXECUTIVE
WITHIN TEN (10) DAYS AFTER THE EXISTENCE OF THE SHORTFALL IS DISCOVERED.  IN THE
EVENT THE GROSS UP AMOUNT IS MORE THAN THE AMOUNT ACTUALLY DUE THE EXECUTIVE
UNDER THIS SECTION 6.4, THE EXECUTIVE SHALL REPAY THE AMOUNT OF SUCH OVERPAYMENT
TO THE COMPANY WITHIN A REASONABLE TIME AFTER THE OVERPAYMENT IS DISCOVERED.

 

6.5           THE SEVERANCE PAYMENTS AND OTHER BENEFITS PROVIDED FOR IN THIS
SECTION 6 ARE IN ADDITION TO ANY OTHER PAYMENTS OR BENEFITS ARISING UPON A
CHANGE OF CONTROL UNDER ANY OTHER AGREEMENT OR PLAN, PROGRAM OR ARRANGEMENT
MAINTAINED BY THE COMPANY OTHER THAN THE POST-TERMINATION PAYMENTS DESCRIBED IN
SECTION 5.3.

 

6.6           IN RETURN FOR THE SEVERANCE PAYMENTS AND OTHER BENEFITS PROVIDED
FOR IN THIS SECTION 6, THE EXECUTIVE AGREES TO EXECUTE THE RELEASE AND WAIVER IN
THE FORM ATTACHED AS EXHIBIT A HERETO, SAID RELEASE AND WAIVER TO INCLUDE,
WITHOUT LIMITATION, CLAIMS PURSUANT TO THE AGE DISCRIMINATION IN EMPLOYMENT ACT
AND ALL OTHER CLAIMS, INCLUDING CLAIMS UNDER FEDERAL AND/OR STATE LAW, ARISING
OUT OF OR RELATING TO THE EXECUTIVE’S HIRING, EMPLOYMENT, OR TERMINATION OF
EMPLOYMENT.  FOR A PERIOD OF SEVEN DAYS AFTER THE EXECUTIVE HAS EXECUTED SUCH
RELEASE AND WAIVER, THE EXECUTIVE MAY REVOKE THE RELEASE AND WAIVER.  THE
RELEASE AND WAIVER SHALL BECOME EFFECTIVE, AND THE SEVERANCE PAYMENTS AND OTHER
BENEFITS PROVIDED FOR IN THIS SECTION 6 SHALL BECOME DUE, ONLY UPON THE
EXPIRATION OF THE SEVEN-DAY REVOCATION PERIOD WITHOUT REVOCATION OF THE RELEASE
AND WAIVER BY THE EXECUTIVE.  NOTWITHSTANDING THE FOREGOING, THE COMPANY AND THE
EXECUTIVE AGREE THAT THE TERMS OF THIS AGREEMENT SHALL SURVIVE THE RELEASE AND
WAIVER AND THAT CLAIMS TO ENFORCE THE TERMS OF THIS AGREEMENT ARE NOT DISCHARGED
BY THE RELEASE AND WAIVER.

 

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7.             TERMINATION PROCEDURES AND COMPENSATION DURING DISPUTE.

 

7.1           NOTICE OF TERMINATION. AFTER A CHANGE IN CONTROL AND DURING THE
TERM OF THIS AGREEMENT, ANY PURPORTED TERMINATION OF THE EXECUTIVE’S EMPLOYMENT
(OTHER THAN BY REASON OF DEATH) SHALL BE COMMUNICATED BY WRITTEN NOTICE OF
TERMINATION FROM ONE PARTY HERETO TO THE OTHER PARTY HERETO IN ACCORDANCE WITH
SECTION 10 HEREOF. FOR PURPOSES OF THIS AGREEMENT, A “NOTICE OF TERMINATION”
SHALL MEAN A NOTICE WHICH INDICATES THE SPECIFIC TERMINATION PROVISION IN THIS
AGREEMENT RELIED UPON AND SETS FORTH IN REASONABLE DETAIL THE FACTS AND
CIRCUMSTANCES CLAIMED TO PROVIDE A BASIS FOR TERMINATION OF THE EXECUTIVE’S
EMPLOYMENT UNDER THE PROVISION SO INDICATED. FURTHER, A NOTICE OF TERMINATION
FOR CAUSE MUST INCLUDE A COPY OF A RESOLUTION DULY ADOPTED BY THE AFFIRMATIVE
VOTE OF NOT LESS THAN TWO-THIRDS OF THE ENTIRE MEMBERSHIP OF THE BOARD AT A
MEETING OF THE BOARD WHICH WAS CALLED AND HELD FOR THE PURPOSE OF CONSIDERING
SUCH TERMINATION (AFTER REASONABLE NOTICE TO THE EXECUTIVE AND AN OPPORTUNITY
FOR THE EXECUTIVE, TOGETHER WITH THE EXECUTIVE’S COUNSEL, TO BE HEARD BEFORE THE
BOARD) FINDING THAT, IN THE GOOD FAITH OPINION OF THE BOARD, THE EXECUTIVE WAS
GUILTY OF CONDUCT SET FORTH IN CLAUSE (I) OR (II) OF THE DEFINITION OF CAUSE
HEREIN, AND SPECIFYING THE PARTICULARS THEREOF IN DETAIL.

 

7.2           DATE OF TERMINATION. “DATE OF TERMINATION,” WITH RESPECT TO ANY
PURPORTED TERMINATION OF THE EXECUTIVE’S EMPLOYMENT AFTER A CHANGE IN CONTROL
AND DURING THE TERM OF THIS AGREEMENT, SHALL MEAN (I) IF THE EXECUTIVE’S
EMPLOYMENT IS TERMINATED FOR DISABILITY, THIRTY (30) DAYS AFTER NOTICE OF
TERMINATION IS GIVEN (PROVIDED THAT THE EXECUTIVE SHALL NOT HAVE RETURNED TO THE
FULL-TIME PERFORMANCE OF THE EXECUTIVE’S DUTIES DURING SUCH THIRTY (30) DAY
PERIOD), AND (II) IF THE EXECUTIVE’S EMPLOYMENT IS TERMINATED FOR ANY OTHER
REASON, THE DATE SPECIFIED IN THE NOTICE OF TERMINATION (WHICH, IN THE CASE OF A
TERMINATION BY THE COMPANY, SHALL NOT BE LESS THAN THIRTY (30) DAYS (EXCEPT IN
THE CASE OF A TERMINATION FOR CAUSE) AND, IN THE CASE OF A TERMINATION BY THE
EXECUTIVE, SHALL NOT BE LESS THAN FIFTEEN (15) DAYS NOR MORE THAN SIXTY (60)
DAYS, RESPECTIVELY, FROM THE DATE SUCH NOTICE OF TERMINATION IS GIVEN).

 

7.3           DISPUTE CONCERNING TERMINATION. IF PRIOR TO THE DATE OF
TERMINATION (AS DETERMINED WITHOUT REGARD TO THIS SECTION 7.3), THE PARTY
RECEIVING A NOTICE OF TERMINATION NOTIFIES THE OTHER PARTY THAT A DISPUTE EXISTS
CONCERNING THE TERMINATION, THE DATE OF TERMINATION SHALL BE THE DATE ON WHICH
THE DISPUTE IS FINALLY RESOLVED, EITHER BY MUTUAL WRITTEN AGREEMENT OF THE
PARTIES OR BY A FINAL JUDGMENT, ORDER OR DECREE (WHICH IS NOT APPEALABLE OR WITH
RESPECT TO WHICH THE TIME FOR APPEAL THEREFROM HAS EXPIRED AND NO APPEAL HAS
BEEN PERFECTED) OF A COURT OF COMPETENT JURISDICTION; PROVIDED, HOWEVER, THAT
THE DATE OF TERMINATION SHALL BE EXTENDED BY A NOTICE OF DISPUTE ONLY IF SUCH
NOTICE IS GIVEN IN GOOD FAITH AND THE PARTY GIVING SUCH NOTICE PURSUES THE
RESOLUTION OF SUCH DISPUTE WITH REASONABLE DILIGENCE.

 

7.4           COMPENSATION DURING DISPUTE. IF A PURPORTED TERMINATION OCCURS
FOLLOWING A CHANGE IN CONTROL AND DURING THE TERM OF THIS AGREEMENT, AND SUCH
TERMINATION IS DISPUTED IN ACCORDANCE WITH SECTION 7.3 HEREOF, THE COMPANY SHALL
CONTINUE TO PAY THE EXECUTIVE THE FULL COMPENSATION IN EFFECT WHEN THE NOTICE
GIVING RISE TO THE DISPUTE WAS GIVEN (INCLUDING, BUT NOT LIMITED TO, SALARY) AND
CONTINUE THE EXECUTIVE AS A PARTICIPANT IN ALL COMPENSATION, BENEFIT AND
INSURANCE PLANS IN WHICH THE EXECUTIVE WAS PARTICIPATING WHEN THE NOTICE GIVING
RISE TO THE DISPUTE WAS GIVEN, UNTIL THE DISPUTE IS FINALLY RESOLVED IN
ACCORDANCE WITH SECTION 7.3 HEREOF. AMOUNTS PAID UNDER THIS SECTION 7.4 ARE IN
ADDITION TO ALL OTHER AMOUNTS DUE UNDER THIS

 

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AGREEMENT (OTHER THAN THOSE DUE UNDER SECTION 5.2 HEREOF) AND SHALL NOT BE
OFFSET AGAINST OR REDUCE ANY OTHER AMOUNTS DUE UNDER THIS AGREEMENT.

 

8.             NO MITIGATION. THE COMPANY AGREES THAT, IF THE EXECUTIVE’S
EMPLOYMENT BY THE COMPANY IS TERMINATED DURING THE TERM OF THIS AGREEMENT, THE
EXECUTIVE IS NOT REQUIRED TO SEEK OTHER EMPLOYMENT OR TO ATTEMPT IN ANY WAY TO
REDUCE ANY AMOUNTS PAYABLE TO THE EXECUTIVE BY THE COMPANY PURSUANT TO SECTION 6
OR SECTION 7.4 HEREOF. FURTHER, THE AMOUNT OF ANY PAYMENT OR BENEFIT PROVIDED
FOR IN SECTION 6 (OTHER THAN SECTION 6.1(C)) OR SECTION 7.4 HEREOF SHALL NOT BE
REDUCED BY ANY COMPENSATION EARNED BY THE EXECUTIVE AS THE RESULT OF EMPLOYMENT
BY ANOTHER EMPLOYER, BY RETIREMENT BENEFITS, BY OFFSET AGAINST ANY AMOUNT
CLAIMED TO BE OWED BY THE EXECUTIVE TO THE COMPANY, OR OTHERWISE.

 

9.             SUCCESSORS; BINDING AGREEMENT.

 

9.1           IN ADDITION TO ANY OBLIGATIONS IMPOSED BY LAW UPON ANY SUCCESSOR
TO J. JILL, J. JILL WILL REQUIRE ANY SUCCESSOR (WHETHER DIRECT OR INDIRECT, BY
PURCHASE, MERGER, CONSOLIDATION OR OTHERWISE) TO ALL OR SUBSTANTIALLY ALL OF THE
BUSINESS OR ASSETS OF J. JILL TO EXPRESSLY ASSUME AND AGREE TO PERFORM THIS
AGREEMENT IN THE SAME MANNER AND TO THE SAME EXTENT THAT J. JILL WOULD BE
REQUIRED TO PERFORM IT IF NO SUCH SUCCESSION HAD TAKEN PLACE. FAILURE OF J. JILL
TO OBTAIN SUCH ASSUMPTION AND AGREEMENT PRIOR TO THE EFFECTIVENESS OF ANY SUCH
SUCCESSION SHALL BE A BREACH OF THIS AGREEMENT AND SHALL ENTITLE THE EXECUTIVE
TO COMPENSATION IN THE SAME AMOUNT AND ON THE SAME TERMS AS THE EXECUTIVE WOULD
BE ENTITLED TO HEREUNDER IF THE EXECUTIVE WERE TO TERMINATE THE EXECUTIVE’S
EMPLOYMENT FOR GOOD REASON AFTER A CHANGE IN CONTROL, EXCEPT THAT, FOR PURPOSES
OF IMPLEMENTING THE FOREGOING, THE DATE ON WHICH ANY SUCH SUCCESSION BECOMES
EFFECTIVE SHALL BE DEEMED THE DATE OF TERMINATION.

 

9.2           THIS AGREEMENT SHALL INURE TO THE BENEFIT OF AND BE ENFORCEABLE BY
THE EXECUTIVE’S PERSONAL OR LEGAL REPRESENTATIVES, EXECUTORS, ADMINISTRATORS,
SUCCESSORS, HEIRS, DISTRIBUTEES, DEVISEES AND LEGATEES. IF THE EXECUTIVE SHALL
DIE WHILE ANY AMOUNT WOULD STILL BE PAYABLE TO THE EXECUTIVE HEREUNDER (OTHER
THAN AMOUNTS WHICH, BY THEIR TERMS, TERMINATE UPON THE DEATH OF THE EXECUTIVE)
IF THE EXECUTIVE HAD CONTINUED TO LIVE, ALL SUCH AMOUNTS, UNLESS OTHERWISE
PROVIDED HEREIN, SHALL BE PAID IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT TO
THE EXECUTORS, PERSONAL REPRESENTATIVES OR ADMINISTRATORS OF THE EXECUTIVE’S
ESTATE.

 

10.           NOTICES.  FOR THE PURPOSE OF THIS AGREEMENT, NOTICES AND ALL OTHER
COMMUNICATIONS PROVIDED FOR IN THIS AGREEMENT SHALL BE IN WRITING AND SHALL BE
DEEMED TO HAVE BEEN DULY GIVEN WHEN DELIVERED OR WHEN MAILED BY UNITED STATES
REGISTERED MAIL, RETURN RECEIPT REQUESTED, POSTAGE PREPAID, ADDRESSED TO THE
RESPECTIVE ADDRESSES SET FORTH BELOW, OR TO SUCH OTHER ADDRESS AS EITHER PARTY
MAY HAVE FURNISHED TO THE OTHER IN WRITING IN ACCORDANCE HEREWITH, EXCEPT THAT
NOTICE OF CHANGE OF ADDRESS SHALL BE EFFECTIVE ONLY UPON ACTUAL RECEIPT:

To the Company:

 

The J. Jill Group, Inc.

4 Batterymarch Park

Quincy, Massachusetts  02169-7468

Attention: Chief Financial Officer

 

7

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with a copy to:

 

David R. Pierson, Esq.

Foley Hoag LLP

Seaport World Trade Center West

155 Seaport Boulevard

Boston, Massachusetts 02210-2600

 

To the Executive:

 

Gordon R. Cooke

400 East 57th Street

New York, New York 10022

 

11.           MISCELLANEOUS.  NO PROVISION OF THIS AGREEMENT MAY BE MODIFIED,
WAIVED OR DISCHARGED UNLESS SUCH WAIVER, MODIFICATION OR DISCHARGE IS AGREED TO
IN WRITING AND SIGNED BY THE EXECUTIVE AND SUCH OFFICER AS MAY BE SPECIFICALLY
DESIGNATED BY THE BOARD.  NO WAIVER BY EITHER PARTY HERETO AT ANY TIME OF ANY
BREACH BY THE OTHER PARTY HERETO OF, OR COMPLIANCE WITH, ANY CONDITION OR
PROVISION OF THIS AGREEMENT TO BE PERFORMED BY SUCH OTHER PARTY SHALL BE DEEMED
A WAIVER OF SIMILAR OR DISSIMILAR PROVISIONS OR CONDITIONS AT THE SAME OR AT ANY
PRIOR OR SUBSEQUENT TIME.  NO AGREEMENTS OR REPRESENTATIONS, ORAL OR OTHERWISE,
EXPRESS OR IMPLIED, WITH RESPECT TO THE SUBJECT MATTER HEREOF HAVE BEEN MADE BY
EITHER PARTY WHICH ARE NOT EXPRESSLY SET FORTH IN THIS AGREEMENT.  THIS
AGREEMENT SUPERSEDES THE PRIOR AGREEMENT IN ITS ENTIRETY.  THE VALIDITY,
INTERPRETATION, CONSTRUCTION AND PERFORMANCE OF THIS AGREEMENT SHALL BE GOVERNED
BY THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS, WITHOUT REGARD TO ITS
PRINCIPLES OF CONFLICTS OF LAWS.  ALL REFERENCES TO SECTIONS OF THE EXCHANGE ACT
SHALL BE DEEMED ALSO TO REFER TO ANY SUCCESSOR PROVISIONS TO SUCH SECTIONS. ANY
PAYMENTS PROVIDED FOR HEREUNDER SHALL BE PAID NET OF ANY APPLICABLE WITHHOLDING
REQUIRED UNDER FEDERAL, STATE OR LOCAL LAW AND ANY ADDITIONAL WITHHOLDING TO
WHICH THE EXECUTIVE HAS AGREED. THE OBLIGATIONS OF THE COMPANY AND THE EXECUTIVE
UNDER SECTIONS 6 AND 7 HEREOF SHALL SURVIVE THE EXPIRATION OF THE TERM OF THIS
AGREEMENT.

 

12.           VALIDITY. THE INVALIDITY OR UNENFORCEABILITY OR ANY PROVISION OF
THIS AGREEMENT SHALL NOT AFFECT THE VALIDITY OR ENFORCEABILITY OF ANY OTHER
PROVISION OF THIS AGREEMENT, WHICH SHALL REMAIN IN FULL FORCE AND EFFECT.

 

13.           COUNTERPARTS. THIS AGREEMENT MAY BE EXECUTED IN SEVERAL
COUNTERPARTS, EACH OF WHICH SHALL BE DEEMED TO BE AN ORIGINAL BUT ALL OF WHICH
TOGETHER WILL CONSTITUTE ONE AND THE SAME INSTRUMENT.

 

14.           SETTLEMENT OF DISPUTES; ARBITRATION. ALL CLAIMS BY THE EXECUTIVE
FOR BENEFITS UNDER THIS AGREEMENT SHALL BE DIRECTED TO AND DETERMINED BY THE
BOARD AND SHALL BE IN WRITING. ANY DENIAL BY THE BOARD OF A CLAIM FOR BENEFITS
UNDER THIS AGREEMENT SHALL BE DELIVERED TO THE EXECUTIVE IN WRITING AND SHALL
SET FORTH THE SPECIFIC REASONS FOR THE DENIAL AND THE SPECIFIC PROVISIONS OF
THIS AGREEMENT RELIED UPON. THE BOARD SHALL AFFORD A REASONABLE OPPORTUNITY TO
THE EXECUTIVE FOR A REVIEW OF THE DECISION DENYING A CLAIM AND SHALL FURTHER
ALLOW THE EXECUTIVE TO APPEAL TO THE BOARD A DECISION OF THE BOARD WITHIN SIXTY
(60) DAYS AFTER NOTIFICATION BY THE BOARD

 

8

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THAT THE EXECUTIVE’S CLAIM HAS BEEN DENIED. ANY FURTHER DISPUTE OR CONTROVERSY
ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT SHALL BE SETTLED EXCLUSIVELY
BY ARBITRATION IN BOSTON, MASSACHUSETTS, IN ACCORDANCE WITH THE RULES OF THE
AMERICAN ARBITRATION ASSOCIATION THEN IN EFFECT.  JUDGMENT MAY BE ENTERED ON THE
ARBITRATOR’S AWARD IN ANY COURT HAVING JURISDICTION; PROVIDED, HOWEVER, THAT THE
EXECUTIVE SHALL BE ENTITLED TO SEEK SPECIFIC PERFORMANCE OF THE EXECUTIVE’S
RIGHT TO BE PAID UNTIL THE DATE OF TERMINATION DURING THE PENDENCY OF ANY
DISPUTE OR CONTROVERSY ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT.

 

15.           DEFINITIONS. FOR PURPOSES OF THIS AGREEMENT, THE FOLLOWING TERMS
SHALL HAVE THE MEANINGS INDICATED BELOW:

 

(A)          “BENEFICIAL OWNER” SHALL HAVE THE MEANING DEFINED IN RULE 13D-3
UNDER THE EXCHANGE ACT.

 

(B)           “BOARD” SHALL MEAN THE BOARD OF DIRECTORS OF J. JILL.

 

(C)           “BONUS PLAN” SHALL MEAN A J. JILL INCENTIVE COMPENSATION PLAN,
SUPPLEMENTAL BONUS PLAN OR OTHER BONUS OR SUPPLEMENTARY COMPENSATION PLAN OR
ARRANGEMENT APPLICABLE TO THE EXECUTIVE.

 

(D)          “CAUSE” FOR TERMINATION BY THE COMPANY OF THE EXECUTIVE’S
EMPLOYMENT, AFTER ANY CHANGE IN CONTROL, SHALL MEAN (I) THE WILLFUL AND
CONTINUED FAILURE BY THE EXECUTIVE TO SUBSTANTIALLY PERFORM THE EXECUTIVE’S
DUTIES WITH THE COMPANY (OTHER THAN ANY SUCH FAILURE RESULTING FROM THE
EXECUTIVE’S INCAPACITY DUE TO PHYSICAL OR MENTAL ILLNESS OR ANY SUCH ACTUAL OR
ANTICIPATED FAILURE AFTER THE ISSUANCE OF A NOTICE OF TERMINATION FOR GOOD
REASON BY THE EXECUTIVE PURSUANT TO SECTION 7.1 HEREOF) AFTER A WRITTEN DEMAND
FOR SUBSTANTIAL PERFORMANCE IS DELIVERED TO THE EXECUTIVE BY THE BOARD, WHICH
DEMAND SPECIFICALLY IDENTIFIES THE MANNER IN WHICH THE BOARD BELIEVES THAT THE
EXECUTIVE HAS NOT SUBSTANTIALLY PERFORMED THE EXECUTIVE’S DUTIES, OR (II) THE
WILLFUL ENGAGING BY THE EXECUTIVE IN CONDUCT WHICH IS DEMONSTRABLY AND
MATERIALLY INJURIOUS TO THE COMPANY, MONETARILY OR OTHERWISE. FOR PURPOSES OF
CLAUSES (I) AND (II) OF THIS DEFINITION, NO ACT, OR FAILURE TO ACT, ON THE
EXECUTIVE’S PART SHALL BE DEEMED “WILLFUL” UNLESS DONE, OR OMITTED TO BE DONE,
BY THE EXECUTIVE NOT IN GOOD FAITH AND WITHOUT REASONABLE BELIEF THAT THE
EXECUTIVE’S ACT, OR FAILURE TO ACT, WAS IN THE BEST INTEREST OF THE COMPANY.

 

(E)           A “CHANGE IN CONTROL” SHALL BE DEEMED TO HAVE OCCURRED IF THE
CONDITIONS SET FORTH IN ANY ONE OF THE FOLLOWING PARAGRAPHS SHALL HAVE BEEN
SATISFIED:

 

(I)            ANY PERSON BECOMES THE BENEFICIAL OWNER, DIRECTLY OR INDIRECTLY,
OF SECURITIES OF J. JILL REPRESENTING 50% OR MORE OF THE COMBINED VOTING POWER
OF J. JILL’S THEN OUTSTANDING SECURITIES; OR

 

(II)           DURING ANY PERIOD OF TWO (2) CONSECUTIVE YEARS (NOT INCLUDING ANY
PERIOD PRIOR TO THE EXECUTION OF THIS AGREEMENT), INDIVIDUALS WHO AT THE
BEGINNING OF SUCH PERIOD CONSTITUTE THE BOARD AND ANY NEW DIRECTOR (OTHER THAN A
DIRECTOR DESIGNATED BY A PERSON WHO HAS ENTERED INTO AN AGREEMENT WITH J. JILL
TO EFFECT A TRANSACTION DESCRIBED IN CLAUSE (I), (III) OR (IV) OF THIS
PARAGRAPH) WHOSE ELECTION BY THE BOARD OR NOMINATION FOR ELECTION BY J. JILL’S
STOCKHOLDERS WAS APPROVED BY A VOTE OF AT LEAST TWO-THIRDS (2/3) OF THE
DIRECTORS THEN STILL IN OFFICE WHO EITHER WERE DIRECTORS AT THE BEGINNING OF THE
PERIOD OR WHOSE ELECTION OR NOMINATION

 

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FOR ELECTION WAS PREVIOUSLY SO APPROVED (A “CONTINUING DIRECTOR”), CEASE FOR ANY
REASON TO CONSTITUTE A MAJORITY THEREOF; OR

 

(III)         THE STOCKHOLDERS OF J. JILL APPROVE A MERGER OR CONSOLIDATION OF
J. JILL WITH ANY OTHER CORPORATION, OTHER THAN (I) A MERGER OR CONSOLIDATION
WHICH WOULD RESULT IN THE VOTING SECURITIES OF J. JILL OUTSTANDING IMMEDIATELY
PRIOR THERETO CONTINUING TO REPRESENT (EITHER BY REMAINING OUTSTANDING OR BY
BEING CONVERTED INTO VOTING SECURITIES OF THE SURVIVING ENTITY) AT LEAST 50% OF
THE COMBINED VOTING POWER OF THE VOTING SECURITIES OF J. JILL OR SUCH SURVIVING
ENTITY OUTSTANDING IMMEDIATELY AFTER SUCH MERGER OR CONSOLIDATION, OR (II) A
MERGER OR CONSOLIDATION EFFECTED TO IMPLEMENT A RECAPITALIZATION OF J. JILL (OR
SIMILAR TRANSACTION) IN WHICH NO PERSON ACQUIRES MORE THAN 50% OF THE COMBINED
VOTING POWER OF THE COMPANY’S THEN OUTSTANDING SECURITIES; OR

 

(IV)         THE STOCKHOLDERS OF J. JILL APPROVE A PLAN OF COMPLETE LIQUIDATION
OF J. JILL OR AN AGREEMENT FOR THE SALE OR DISPOSITION BY J. JILL OF ALL OR
SUBSTANTIALLY ALL J. JILL’S ASSETS.

The foregoing to the contrary notwithstanding, a Change in Control shall not be
deemed to have occurred with respect to the Executive if the Executive is “part
of a purchasing group” which consummates the Change in Control transaction. The
Executive shall be deemed “part of a purchasing group” for purposes of the
preceding sentence if the Executive is an equity participant or has agreed to
become an equity participant in the purchasing company or group (except for
(i) passive ownership of less than 5% of the stock of the purchasing company or
(ii) ownership of equity participation in the purchasing company or group which
is otherwise not deemed to be significant, as determined prior to the Change in
Control by a majority of the non-employee Continuing Directors).

 

(F)           “CHANGE IN CONTROL PAYMENT” SHALL HAVE THE MEANING STATED IN
SECTION 6.4 HEREOF.

 

(G)           “CODE” SHALL MEAN THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.

 

(H)          “COMPANY” SHALL MEAN J. JILL AND ITS SUBSIDIARIES.

 

(I)            “DATE OF TERMINATION” SHALL HAVE THE MEANING STATED IN
SECTION 7.2 HEREOF.

 

(J)            “DISABILITY” SHALL BE DEEMED THE REASON FOR THE TERMINATION BY
THE COMPANY OF THE EXECUTIVE’S EMPLOYMENT, IF, AS A RESULT OF THE EXECUTIVE’S
INCAPACITY DUE TO PHYSICAL OR MENTAL ILLNESS, THE EXECUTIVE SHALL HAVE BEEN
ABSENT FROM THE FULL-TIME PERFORMANCE OF THE EXECUTIVE’S DUTIES WITH THE COMPANY
FOR A PERIOD OF SIX (6) CONSECUTIVE MONTHS, THE COMPANY SHALL HAVE GIVEN THE
EXECUTIVE A NOTICE OF TERMINATION FOR DISABILITY, AND, WITHIN THIRTY (30) DAYS
AFTER SUCH NOTICE OF TERMINATION IS GIVEN, THE EXECUTIVE SHALL NOT HAVE RETURNED
TO THE FULL-TIME PERFORMANCE OF THE EXECUTIVE’S DUTIES.

 

(K)          “EXCHANGE ACT” SHALL MEAN THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED FROM TIME TO TIME.

 

(L)           “EXCISE TAX” SHALL HAVE THE MEANING STATED IN SECTION 6.4 HEREOF.

 

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(M)         “EXECUTIVE” SHALL MEAN THE INDIVIDUAL NAMED IN THE FIRST PARAGRAPH
OF THIS AGREEMENT.

 

(N)          “GOOD REASON” FOR TERMINATION BY THE EXECUTIVE OF THE EXECUTIVE’S
EMPLOYMENT SHALL MEAN THE OCCURRENCE (WITHOUT THE EXECUTIVE’S EXPRESS WRITTEN
CONSENT) OF ANY ONE OF THE FOLLOWING ACTS BY THE COMPANY, OR FAILURES BY THE
COMPANY TO ACT, UNLESS, IN THE CASE OF ANY ACT OR FAILURE TO ACT DESCRIBED IN
PARAGRAPH (I), (V), (VI), (VII), OR (VIII) BELOW, SUCH ACT OR FAILURE TO ACT IS
CORRECTED PRIOR TO THE DATE OF TERMINATION SPECIFIED IN THE NOTICE OF
TERMINATION GIVEN IN RESPECT THEREOF:

 

(I)            THE ASSIGNMENT TO THE EXECUTIVE OF ANY DUTIES INCONSISTENT WITH
THE EXECUTIVE’S STATUS AS A SENIOR OFFICER OF THE COMPANY OR A SUBSTANTIAL
ADVERSE ALTERATION IN THE NATURE OR STATUS OF THE EXECUTIVE’S RESPONSIBILITIES
FROM THOSE IN EFFECT IMMEDIATELY PRIOR TO THE CHANGE IN CONTROL;

 

(II)           A REDUCTION BY THE COMPANY IN THE EXECUTIVE’S ANNUAL BASE SALARY
AS IN EFFECT ON THE DATE HEREOF OR AS THE SAME MAY BE INCREASED FROM TIME TO
TIME;

 

(III)         THE COMPANY’S REQUIRING THAT THE EXECUTIVE’S PRINCIPAL PLACE OF
BUSINESS BE AT AN OFFICE LOCATED MORE THAN 25 MILES FROM (I) THE SITE OF THE
EXECUTIVE’S PRINCIPAL PLACE OF BUSINESS IMMEDIATELY PRIOR TO THE CHANGE IN
CONTROL OR (II) NEW YORK, NEW YORK, EXCEPT FOR REQUIRED TRAVEL ON THE COMPANY’S
BUSINESS TO AN EXTENT SUBSTANTIALLY CONSISTENT WITH THE EXECUTIVE’S PRESENT
BUSINESS TRAVEL OBLIGATIONS;

 

(IV)         THE FAILURE BY THE COMPANY, WITHOUT THE EXECUTIVE’S CONSENT, TO PAY
TO THE EXECUTIVE ANY PORTION OF THE EXECUTIVE’S THEN CURRENT COMPENSATION, OR TO
PAY TO THE EXECUTIVE ANY PORTION OF AN INSTALLMENT OF DEFERRED COMPENSATION
UNDER ANY DEFERRED COMPENSATION PROGRAM OF THE COMPANY, WITHIN SEVEN (7) DAYS OF
THE DATE SUCH COMPENSATION IS DUE;

 

(V)           THE FAILURE BY THE COMPANY TO CONTINUE IN EFFECT ANY COMPENSATION
PLAN IN WHICH THE EXECUTIVE PARTICIPATES IMMEDIATELY PRIOR TO THE CHANGE IN
CONTROL WHICH IS MATERIAL TO THE EXECUTIVE’S TOTAL COMPENSATION, UNLESS AN
EQUITABLE ARRANGEMENT (EMBODIED IN AN ONGOING SUBSTITUTE OR ALTERNATIVE PLAN)
HAS BEEN MADE WITH RESPECT TO SUCH PLAN, OR THE FAILURE BY THE COMPANY TO
CONTINUE THE EXECUTIVE’S PARTICIPATION THEREIN (OR IN SUCH SUBSTITUTE OR
ALTERNATIVE PLAN) ON A BASIS NOT MATERIALLY LESS FAVORABLE, BOTH IN TERMS OF THE
AMOUNT OF BENEFITS PROVIDED AND THE LEVEL OF THE EXECUTIVE’S PARTICIPATION
RELATIVE TO OTHER PARTICIPANTS, AS EXISTED AT THE TIME OF THE CHANGE IN CONTROL;

 

(VI)         THE FAILURE BY THE COMPANY TO CONTINUE TO PROVIDE THE EXECUTIVE
WITH BENEFITS SUBSTANTIALLY SIMILAR TO THOSE ENJOYED BY THE EXECUTIVE UNDER ANY
OF THE COMPANY’S PENSION, LIFE INSURANCE, MEDICAL, HEALTH AND ACCIDENT, OR
DISABILITY PLANS IN WHICH THE EXECUTIVE WAS PARTICIPATING AT THE TIME OF THE
CHANGE IN CONTROL, THE TAKING OF ANY ACTION BY THE COMPANY WHICH WOULD DIRECTLY
OR INDIRECTLY MATERIALLY REDUCE ANY OF SUCH BENEFITS OR DEPRIVE THE EXECUTIVE OF
ANY MATERIAL FRINGE BENEFIT ENJOYED BY THE EXECUTIVE AT THE TIME OF THE CHANGE
IN CONTROL, OR THE FAILURE BY THE COMPANY TO PROVIDE THE EXECUTIVE WITH THE
NUMBER OF PAID VACATION DAYS TO WHICH THE EXECUTIVE IS ENTITLED ON THE BASIS OF
YEARS OF SERVICE WITH THE

 

11

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COMPANY IN ACCORDANCE WITH THE COMPANY’S NORMAL VACATION POLICY IN EFFECT AT THE
TIME OF THE CHANGE IN CONTROL; OR

 

(VII)        ANY PURPORTED TERMINATION OF THE EXECUTIVE’S EMPLOYMENT WHICH IS
NOT EFFECTED PURSUANT TO A NOTICE OF TERMINATION SATISFYING THE REQUIREMENTS OF
SECTION 10 HEREOF; FOR PURPOSES OF THIS AGREEMENT, NO SUCH PURPORTED TERMINATION
SHALL BE EFFECTIVE.

 

The Executive’s right to terminate the Executive’s employment for Good Reason
shall not be affected by the Executive’s incapacity due to physical or mental
illness. The Executive’s continued employment shall not constitute consent to,
or a waiver of rights with respect to, any act or failure to act constituting
Good Reason hereunder.

 

(O)          “GROSS UP AMOUNTS” SHALL HAVE THE MEANING STATED IN SECTION 6.4
HEREOF.

 

(P)           “J. JILL” SHALL MEAN THE J. JILL GROUP, INC. AND ANY SUCCESSOR TO
ITS BUSINESS OR ASSETS WHICH ASSUMES AND AGREES TO PERFORM THIS AGREEMENT BY
OPERATION OF LAW, OR OTHERWISE (EXCEPT IN DETERMINING, UNDER
SECTION 15(E) HEREOF, WHETHER OR NOT ANY CHANGE IN CONTROL OF J. JILL HAS
OCCURRED IN CONNECTION WITH SUCH SUCCESSION).

 

(Q)          “NOTICE OF TERMINATION” SHALL HAVE THE MEANING STATED IN
SECTION 7.1 HEREOF.

 

(R)           “PERSON” SHALL HAVE THE MEANING GIVEN IN SECTION 3(A)(9) OF THE
EXCHANGE ACT, AS MODIFIED AND USED IN SECTIONS 13(D) AND 14(D) THEREOF;
PROVIDED, HOWEVER, THAT A PERSON SHALL NOT INCLUDE (I) J. JILL OR ANY OF ITS
SUBSIDIARIES, (II) A TRUSTEE OR OTHER FIDUCIARY HOLDING SECURITIES UNDER AN
EMPLOYEE BENEFIT PLAN OF THE COMPANY, (III) AN UNDERWRITER TEMPORARILY HOLDING
SECURITIES PURSUANT TO AN OFFERING OF SUCH SECURITIES, OR (IV) A CORPORATION
OWNED, DIRECTLY OR INDIRECTLY, BY THE STOCKHOLDERS OF J. JILL IN SUBSTANTIALLY
THE SAME PROPORTIONS AS THEIR OWNERSHIP OF STOCK OF J. JILL.

 

(S)           “POST-TERMINATION PAYMENTS” SHALL HAVE THE MEANING STATED IN
SECTION 5.3 HEREOF.

 

(T)           A “POTENTIAL CHANGE IN CONTROL” SHALL BE DEEMED TO HAVE OCCURRED
IF THE CONDITIONS SET FORTH IN ANY ONE OF THE FOLLOWING PARAGRAPHS SHALL HAVE
BEEN SATISFIED:

 

(I)            J. JILL ENTERS INTO AN AGREEMENT, THE CONSUMMATION OF WHICH WOULD
RESULT IN THE OCCURRENCE OF A CHANGE IN CONTROL;

 

(II)           J. JILL OR ANY PERSON PUBLICLY ANNOUNCES AN INTENTION TO TAKE OR
TO CONSIDER TAKING ACTIONS WHICH, IF CONSUMMATED, WOULD CONSTITUTE A CHANGE IN
CONTROL;

 

(III)         ANY PERSON WHO IS OR BECOMES THE BENEFICIAL OWNER, DIRECTLY OR
INDIRECTLY, OF SECURITIES OF J. JILL REPRESENTING AT LEAST 20% OR MORE OF THE
COMBINED VOTING POWER OF J. JILL’S THEN OUTSTANDING SECURITIES INCREASES SUCH
PERSON’S BENEFICIAL OWNERSHIP OF SUCH SECURITIES BY 5% OR MORE OVER THE
PERCENTAGE SO OWNED BY SUCH PERSON ON THE DATE HEREOF; OR

 

12

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(IV)         THE BOARD ADOPTS A RESOLUTION TO THE EFFECT THAT, FOR PURPOSES OF
THIS AGREEMENT, A POTENTIAL CHANGE IN CONTROL HAS OCCURRED.

 

The foregoing to the contrary notwithstanding, a Potential Change in Control
shall not be deemed to have occurred with respect to the Executive if (i) the
event first giving rise to the Potential Change in Control involves a publicly
announced transaction or publicly announced proposed transaction which at the
time of the announcement has not been previously approved by the Board and
(ii) the Executive is “part of a purchasing group” proposing the transaction. 
The Executive shall be deemed “part of a purchasing group” for purposes of the
preceding sentence if the Executive is an equity participant or has agreed to
become an equity participant in the purchasing company or group (except for
(i) passive ownership of less than 5% of the stock of the purchasing company or
(ii) ownership of equity participation in the purchasing company or group which
is otherwise not deemed to be significant, as determined prior to the Potential
Change in Control by a majority of the non-employee Continuing Directors).

 

(U)          “SEVERANCE PAYMENTS” SHALL MEAN THOSE PAYMENTS DESCRIBED IN
SECTION 6.1 HEREOF.

 

(V)           “SUBSIDIARY” SHALL MEAN ANY CORPORATION, PARTNERSHIP, LIMITED
LIABILITY COMPANY OR OTHER ENTITY, AT LEAST A MAJORITY OF THE OUTSTANDING VOTING
SHARES OR CONTROLLING INTEREST OF WHICH IS AT THE TIME DIRECTLY OR INDIRECTLY
OWNED OR CONTROLLED (EITHER ALONE OR THROUGH SUBSIDIARIES OR TOGETHER WITH
SUBSIDIARIES) BY J. JILL OR ANOTHER SUBSIDIARY.

 

[signature page follows]

 

13

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IN WITNESS WHEREOF, the parties have executed this Amended and Restated Change
In Control Severance Agreement as of the date first above written.

 

 

THE J. JILL GROUP, INC.

 

 

 

 

 

 

 

By

/s/ Ruth M. Owades

 

 

 

Authorized Officer

 

 

 

 

/s/ Gordon R. Cooke

 

 

Gordon R. Cooke

 

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EXHIBIT A

 

GENERAL RELEASE AND WAIVER OF ALL CLAIMS

(INCLUDING AGE DISCRIMINATION IN EMPLOYMENT ACT CLAIMS)

 

In consideration of the payment, benefits and other agreements set forth in the
Amended and Restated Change In Control Severance Agreement dated January 27,
2006 between The J. Jill Group, Inc. (“J. Jill”) and Gordon R. Cooke (the
“Executive”) to which this General Release and Waiver Of All Claims is attached
(the “Agreement”), the Executive, for himself and for his heirs, executors,
estates, agents, representatives, attorneys, insurers, successors and assigns
(collectively, the “Releasors”), hereby voluntarily releases and forever
discharges J. Jill and its subsidiaries (direct and indirect), affiliates,
related companies, divisions, and predecessor and successor companies (J. Jill
and such subsidiaries, affiliates, related companies, divisions and predecessor
and successor companies being collectively referred to as the “Company”), and
each of its and their present, former and future shareholders, officers,
directors, employees, agents, representatives, attorneys, insurers, heirs,
successors and assigns in their capacities as such (J. Jill, its subsidiaries,
affiliates, related companies, divisions and predecessor and successor companies
and its and their present, former and future shareholders, officers, directors,
employees, agents, representatives, attorneys, insurers, heirs, successors and
assigns in their capacities as such being collectively referred to as the
“Releasees”) from all actions, causes of action, suits, debts, sums of money,
accounts, covenants, contracts, agreements, promises, damages, judgments,
demands and claims which the Releasors ever had, or now have, or hereafter can,
shall or may have, for, upon or by reason of any matter or cause whatsoever
arising from the beginning of the world to the date of the execution of this
Release and Waiver, whether known or unknown, in law or equity, whether
statutory or common law, whether federal, state, local or otherwise, including
but not limited to claims arising out of or in any way related to the
Executive’s employment by the Company (including his hiring), or the termination
of that employment, whether as a contractor or employee, or any related matters
(including but not limited to claims, if any, arising under the Age
Discrimination in Employment Act of 1967, as amended, the Civil Rights Act of
1866, Title VII of the Civil Rights Act of 1964, as amended, the Civil Rights
Act of 1991, as amended, the Americans With Disabilities Act of 1990, as
amended, the Family and Medical Leave Act of 1993, the Immigration Reform and
Control Act of 1986, the Massachusetts Law Against Discrimination (Mass. Gen.
Laws ch. 151B§1 et seq.), the Massachusetts Payment of Wages Act, the
Massachusetts Civil and Equal Rights Acts, and federal or Massachusetts laws,
statutes and regulations, including common or constitutional law).

 

THE EXECUTIVE REPRESENTS AND WARRANTS THAT THE EXECUTIVE KNOWINGLY AND
VOLUNTARILY WAIVES ALL RIGHTS OR CLAIMS ARISING PRIOR TO THE EXECUTIVE’S
EXECUTION OF THIS RELEASE AND WAIVER THAT THE EXECUTIVE MAY HAVE AGAINST THE
RELEASEES, OR ANY OF THEM, TO RECEIVE ANY PAYMENT, BENEFIT OR REMEDIAL RELIEF AS
A CONSEQUENCE OF AN ACTION BROUGHT ON THE EXECUTIVE’S BEHALF IN ANY STATE OR
FEDERAL AGENCY AND/OR AS A CONSEQUENCE OF ANY LITIGATION CONCERNING ANY FACTS
ALLEGED IN ANY SUCH ACTION.

 

The Executive further represents that:

 

A-1

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(a)           The Company has advised the Executive to consult with an attorney
of the Executive’s choosing concerning the rights waived in this Release and
Waiver.  The Executive has carefully read and fully understands this Release and
Waiver, and is voluntarily entering into this Release and Waiver.

 

(b)           The Executive understands that the Executive has 21 days to review
this Release and Waiver prior to its execution.  If at any time prior to the end
of the 21 day period, the Executive executes this Release and Waiver, the
Executive acknowledges that such early execution is a knowing and voluntary
waiver of the Executive’s right to consider this Release and Waiver for at least
21 days and is due to the Executive’s belief that the Executive has had ample
time in which to consider and understand this Release and Waiver and in which to
review this Release and Waiver with an attorney.

 

(c)           The Executive understands that, for a period of seven days after
the Executive has executed this Release and Waiver, the Executive may revoke
this Release and Waiver by giving notice in writing of such revocation to the
Company in accordance with Section 10 of the Agreement.  If at any time after
the end of the seven-day period the Executive accepts any of the payments or
benefits provided described in Section 6 of the Agreement, such acceptance will
constitute an admission by the Executive that the Executive did not revoke this
Release and Waiver during the revocation period and will further constitute an
admission by the Executive that this Release and Waiver has become effective and
enforceable.

 

(d)           The Executive understands the effect of this Release and Waiver
and that the Executive gives up any rights the Executive may have, in particular
but without limitation, under the Federal Age Discrimination in Employment Act
and the Massachusetts Law Against Discrimination (Mass. Gen. Laws ch. 151B§1 et
seq.).

 

(e)           The Executive understands that the Executive is receiving benefits
pursuant to the Agreement that the Executive would not otherwise be entitled to
if the Executive did not enter into this Release and Waiver.

 

(f)            The Executive acknowledges that the severance pay and associated
benefits specified in the Agreement represent all payments and benefits owed to
the Executive and that upon receipt of said payments and benefits, the Executive
shall have received all payments and benefits owed to the Executive in
connection with the Executive’s employment with the Company and that no
additional payments or benefits are due.

Signed and sealed this          day of                   , 200  .

 

Please note that you may revoke this Release and Waiver within 7 days of
signing, in which case this Release and Waiver shall be void.

 

 

 

 

 

Gordon R. Cooke

 

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