Exhibit 10.1

 

RETENTION AWARD AGREEMENT

 

THIS RETENTION AWARD AGREEMENT (this “Agreement”) is entered into and effective
as of November [   ], 2017 (the “Effective Date”), by and between The Bon-Ton
Department Stores, Inc., a Pennsylvania corporation (the “Company”), and
          , an employee of the Company (“Employee”).

 

RECITALS

 

A.                                    The Company has determined that
(i) Employee’s performance of his duties has been and continues to be
exceptional and highly valuable to the Company and (ii) Employee’s continuation
of his duties is critically important to the Company’s ability to manage
successfully its business and all activities and endeavors necessary therefor
and ancillary thereto, particularly in light of the challenging business
environment facing the Company.

 

B.                                    The Company desires to recognize
Employee’s past services and to assure itself of Employee’s continued services
for an extended period of time by paying Employee a cash award in the amount of
$           (the “Award”) that is subject to repayment by Employee if Employee’s
employment with the Company is terminated under certain circumstances prior to
the expiration of the Retention Period (as defined herein), as provided for in
this Agreement.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained, the Company and Employee agree as follows:

 

1.                                      Definitions.  For purposes of this
Agreement:

 

(a)                                 “Affiliate” shall mean a person that
directly, or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, the person specified.

 

(b)                                 “Cause” shall mean:

 

(i)                                     Employee’s willful failure to perform
Employee’s duties (other than any such failure resulting from incapacity due to
physical or mental illness);

 

(ii)                                  Employee’s continuous willful failure to
comply with any valid and legal directive of the individual to whom Employee
reports or the Board of Directors of the Company (the “Board”) or a committee of
the Board;

 

(iii)                               Employee’s willful engagement in dishonesty,
illegal conduct, or gross misconduct that is, in each case, materially injurious
to the Company or its affiliates;

 

(iv)                              Employee’s embezzlement, misappropriation, or
fraud, whether or not related to Employee’s employment with the Company;

 

--------------------------------------------------------------------------------

 

(v)                                 Employee’s conviction of or plea of guilty
or nolo contendere to a crime that constitutes a felony (or state law
equivalent) or a crime that constitutes a misdemeanor involving moral turpitude,
if such felony or other crime (A) is work-related, (B) materially impairs
Employee’s ability to perform services for the Company or (C) in the reasonable
judgment of the Company, has resulted or will result in material reputational or
financial harm to the Company or its affiliates; or

 

(vi)                              Employee’s material breach of any obligation
under this Agreement, if such breach causes material reputational or financial
harm to the Company.

 

For purposes of this Agreement, no act or failure to act on the part of Employee
shall be considered “willful” unless it is done, or omitted to be done, by
Employee in bad faith or without reasonable belief that Employee’s action or
omission was in the best interests of the Company.  Any act, or failure to act,
based upon authority given pursuant to a resolution duly adopted by the Board or
upon the advice of counsel for the Company shall be conclusively presumed to be
done, or omitted to be done, by Employee in good faith and in the best interests
of the Company.

 

Furthermore, a termination of Employee’s employment shall not be deemed for
Cause unless and until the Company delivers to Employee a copy of a resolution
duly adopted by the affirmative vote of not less than a majority of the Board
(after reasonable written notice is provided to Employee and Employee is given
an opportunity, together with counsel, to be heard before the Board), finding
that Employee has engaged in the conduct described in any of clauses
(i)-(vi) above.  Except for an action or breach described in clause (iv) or
(v) above, or any other failure, breach, or refusal that, by its nature, cannot
reasonably be expected to be cured, Employee shall have ten (10) business days
from the delivery of written notice by the Company within which to cure any acts
or omissions constituting Cause, and the determination of whether such attempted
cure is sufficient shall be in the Company’s sole discretion; provided however,
that if the Company reasonably expects irreparable injury or material
reputational or financial harm from a delay of ten (10) business days, the
Company may give Employee notice of such shorter period within which to cure as
is deemed reasonable by the Board under the circumstances, which may include the
termination of Employee’s employment without notice and with immediate effect. 
The Company may place Employee on paid leave for up to thirty (30) days while it
is determining whether there is a basis to terminate Employee’s employment for
Cause.  The placement of Employee on paid leave for up to thirty (30) days in
such circumstances shall not constitute Good Reason.

 

(c)                                  “Code” shall mean the Internal Revenue Code
of 1986, as amended.

 

(d)                                 “Disability” shall mean Employee is entitled
to receive long-term disability benefits under the Company’s long-term
disability plan, or if there is no such plan, Employee’s inability, due to
physical or mental incapacity, to substantially perform Employee’s duties and
responsibilities for one hundred eighty (180) days out of any three hundred
sixty-five (365) day period or one hundred twenty (120) consecutive days;
provided however, in the event that the Company temporarily replaces Employee,
or transfers Employee’s duties or responsibilities to another individual on
account of Employee’s inability to perform such duties due to a mental or
physical incapacity that is, or is reasonably expected to become, a Disability,
then Employee’s employment shall not be deemed terminated by the Company, and
Employee shall not be able to resign for Good Reason as a result thereof.  Any
question as to the existence

 

--------------------------------------------------------------------------------

 

of Employee’s Disability as to which Employee and the Company cannot agree shall
be determined in writing by a qualified independent physician mutually
reasonably acceptable to Employee and the Company.  If Employee and the Company
cannot agree as to a qualified independent physician within fifteen (15) days,
each shall appoint such a physician and those two physicians, within fifteen
(15) days, shall select a third, who, within thirty (30) days, shall make such
determination in writing. The determination of Disability made in writing to the
Company and Employee shall be final and conclusive for all purposes of this
Agreement.

 

(e)                                  “Good Reason” shall mean the occurrence of
any of the following during the Retention Period, in each case without
Employee’s written consent:

 

(i)                                     a reduction in Employee’s base salary;

 

(ii)                                  a relocation of Employee’s principal place
of employment by more than 50 miles;

 

(iii)                               any material breach by the Company of any
material provision of this Agreement or any material provision of any other
agreement between Employee and the Company;

 

(iv)                              the Company’s failure to obtain an agreement
from any successor to the Company to assume and agree to perform this Agreement
in the same manner and to the same extent that the Company would be required to
perform if no succession had taken place, except where such assumption occurs by
operation of law; or

 

(v)                                 a material, adverse change in Employee’s
title, authority, duties, or responsibilities (other than temporarily while
Employee is physically or mentally incapacitated) as of the date of this
Agreement.

 

For purposes of this Agreement, Employee’s termination of his employment shall
not be deemed for Good Reason unless Employee has provided written notice to the
Company (a “Notice”) of the existence of the circumstances providing grounds for
termination for Good Reason within ninety (90) days of the later of (i) the
initial existence of such circumstances and (ii) Employee’s actual knowledge of
the existence of such circumstances, and the Company has had at least thirty
(30) days from the date on which such notice is provided to cure such
circumstances.  If Employee does not (i) provide a Notice of the existence of
the circumstances providing grounds for termination for Good Reason within
ninety (90) days of the later of (A) the initial existence of such circumstances
or (B) Employee’s actual knowledge of the existence of such circumstances, or
(ii) terminate employment for Good Reason within sixty (60) days following
Employee’s delivery of a Notice to the Company (where the Company has not cured
the circumstances providing such grounds for termination for Good Reason within
thirty (30) days of the date of Employee’s delivery of such Notice), then
Employee will be deemed to have waived Employee’s right to terminate for Good
Reason with respect to such grounds.

 

(f)                                   “Retention Period” shall commence on the
Effective Date and terminate on January 1, 2019.

 

--------------------------------------------------------------------------------

 

(g)                                  “Termination Date” shall mean the date on
which Employee’s employment by the Company is terminated.

 

2.                                      Duties.  Except as specifically provided
in Section 3(b) below, in order to retain the Award, Employee agrees that,
during the Retention Period, Employee shall perform fully the terms of this
Agreement and Employee’s duties for the Company.

 

3.                                      Award; Termination of Employment.

 

(a)                                 Award.  On the Effective Date, the Company
shall pay Employee, in cash in a single lump sum, an amount equal to the Award,
less all applicable withholdings and deductions required by law.

 

(b)                                 Repayment of Award upon Termination.  In the
event that Employee’s employment is terminated prior to the end of the Retention
Period due to (x) a termination by the Company for Cause or (y) any termination
by Employee other than for Good Reason, Employee must repay to the Company
within sixty (60) days of the Termination Date the entire, gross amount of the
Award.  In the event that Employee’s employment by the Company is terminated
prior to the end of the Retention Period due to (i) Employee’s death,
(ii) Employee’s Disability, (iii) a termination by the Company without Cause, or
(iv) a termination by Employee for Good Reason, Employee shall not be obligated
to repay to the Company any amount of the Award.  For the avoidance of doubt,
Employee’s retirement from the Company without Good Reason shall constitute a
termination by Employee other than for Good Reason for purposes of this
Agreement and require the repayment of the Award pursuant to this Section 3(b). 
Except as may be limited by Section 409A of the Code, the parties acknowledge
and agree that the Company may, subject to a judicial determination as to
Employee’s obligation to repay the Award, offset any amounts owed to the Company
by Employee pursuant to Employee’s repayment obligations under this
Section 3(b) against any amounts owed to Employee by the Company as of or
following the Termination Date.

 

4.                                      Legal Fees and Expenses.  If (i) either
party commences any proceeding, action, or litigation against the other party
concerning the terms of this Agreement or the rights and duties of the parties
hereto or for the breach of this Agreement by the other party of any of the
terms hereof and (ii) Employee shall prevail in such proceeding, action, or
litigation, in addition to any other relief granted, Employee shall be entitled
to recover all costs and expenses incurred by Employee in connection with
responding to and prosecuting or defending such action and the enforcement and
collection of any judgment rendered therein, including without limitation all
out-of-pocket expenses, court costs, administrative fees, attorneys’ fees,
consultant fees, expert witness fees, personnel expenses, duplicating expenses,
and other related expenses that are associated with Employee’s enforcement of
his legal rights under this Agreement (including all such costs, fees, and
expenses incurred in all appeals) and a right to such costs and expenses shall
be deemed to have accrued upon the commencement of such action and shall be
enforceable whether or not such action is prosecuted to judgment.

 

--------------------------------------------------------------------------------

 

5.                                      Covenants.

 

(a)                                 Non-Solicit.  While Employee is employed by
the Company and following the termination of Employee’s employment for any
reason and continuing for a period of twelve (12) months from the Termination
Date, Employee shall not, directly or indirectly, for Employee or on behalf of,
or in conjunction with, any other person, persons, company, partnership,
corporation, business entity, or otherwise, hire away any employees or
independent contractors of the Company or any Affiliate or entice any such
persons to leave the employ of the Company or any affiliate without the prior
written consent of the Company.  Employee is a party to a restrictive covenant
agreement dated January 15, 2016 and titled, “CONFIDENTIALITY, NON-COMPETITION
AND NON-SOLICITATION AGREEMENT” and hereinafter referred to as the “Restrictive
Covenant Agreement.” Employee continues to be bound by the Restrictive Covenant
Agreement and the covenants therein which shall survive the executive of this
Agreement.

 

(b)                                 Non-Disparagement.  While Employee is
employed by the Company and at all times following the termination of Employee’s
employment for any reason, Employee shall not, directly or indirectly, for
Employee or on behalf of, or in conjunction with, any other person, persons,
company, partnership, corporation, business entity, or otherwise, make any
statements that are inflammatory, detrimental, slanderous, or negative in any
way to the interests of the Company or any affiliate. Nothing in this paragraph
infringes on Employee’s right to participation or cooperation in any charge or
investigation by the Federal Equal Employment Opportunity Commission or any
comparable state agency, or any other self-regulatory organization or any other
state or federal regulatory authority or making other disclosures that are
produced under the whistleblower provisions of federal or state law or
regulation.

 

(c)                                  Confidentiality.  Employee acknowledges
that, during the course of his employment by the Company, he has and will
continue to have access to the Company’s Confidential Information.  Employee
agrees not to use or disclose to any person or entity, at any time, any
Confidential Information of Employee without first obtaining the Company’s
written consent.  The term “Confidential Information” means any information not
generally known to the public that concerns the Company’s business or proposed
future business and that gives or is intended to give the Company an advantage
over its competitors who do not have the information. Notwithstanding the
foregoing non-disclosure obligations, those set forth in the provisions of any
agreement or policy, and any restrictive covenants entered into between Employer
and Employee pursuant to 18 U.S.C. Section 1833(b), Employee shall not be held
criminally or civilly liable under any federal or state trade secret law for the
disclosure of a trade secret that is made:  (i) in confidence to a federal,
state, or local government official, either directly or indirectly, or to an
attorney, and solely for the purpose of reporting or investigating a suspected
violation of law; or (ii) is made in a complaint or other document filed in a
lawsuit or other proceeding if such filing is made under seal.

 

6.                                      Successors.

 

(a)                                 Assignment by Employee.  This Agreement is
personal to Employee and, without the prior written consent of the Company,
shall not be assignable by Employee

 

--------------------------------------------------------------------------------

 

otherwise than by will or the laws of descent and distribution.  This Agreement
shall inure to the benefit of and be enforceable by Employee’s legal
representatives.

 

(b)                                 Assignment by the Company.  This Agreement
shall inure to the benefit of and be binding upon the Company and its
successors.  The Company shall require any successor to all or substantially all
of the business or assets of the Company, whether direct or indirect, by
purchase, merger, consolidation, acquisition of stock, or otherwise, expressly
to assume and agree to perform this Agreement in the same manner and to the same
extent as the Company would be required to perform if no such succession had
taken place.

 

7.                                      Miscellaneous.

 

(a)                                 Impact of Award on Other Benefit Plans.  The
parties hereto agree that the Award to be paid by the Company pursuant to this
Agreement (i) shall be considered a bonus, and hence not compensation, for
purposes of the Company’s benefit plans and programs  (ii) shall not be
construed as compensation or otherwise taken into account, for purposes of
determining any benefits provided under any other compensation arrangement or
benefit plan, practice or policy maintained by the Company or any of its
subsidiaries for any of its or their respective employees.

 

(b)                                 Applicable Law.  This Agreement shall be
governed by and construed and interpreted in accordance with the laws of the
Commonwealth of Pennsylvania, applied without reference to its principles of
conflict of laws.

 

(c)                                  Jurisdiction and Venue.  Each party
irrevocably submits to the exclusive jurisdiction of the Court of Common Pleas
of York County, Pennsylvania, or to the Federal District for the Middle District
of Pennsylvania, for the purposes of any suit, action, or other proceeding
arising out of or relating to this Agreement and agrees that all claims in
respect of the suit, action, or other proceeding shall be heard and determined
in any such court.  Each party agrees to commence any such suit, action, or
other proceeding in the Court of Common Pleas of York County, Pennsylvania or
the Federal District Court for the Middle District of Pennsylvania.  Each party
waives any defense of improper venue or inconvenient forum to the maintenance of
any suit, action, or other proceeding so brought.  Each party waives its right
to a jury trial with respect to any action, or claim arising out of any dispute
in connection with this Agreement, any rights or obligations hereunder, or the
performance of such rights and obligations.

 

(d)                                 Amendments.  This Agreement may not be
amended or modified other than by a written agreement executed by the parties
hereto or their respective successors and legal representatives.

 

(e)                                  Entire Agreement.  This Agreement and the
Restrictive Covenant Agreement shall constitute the entire agreement between the
parties hereto with respect to the matters referred to herein and shall
supersede all prior or existing agreements between the parties hereto with
respect to such matters.  There are no promises, representations, inducements,
or statements between the parties other than those that are expressly contained
herein. Notwithstanding any rule of law to the contrary, this Agreement may not
be modified, changed, amended or waived in any way (either in whole or in part)
orally, by conduct, by informal

 

--------------------------------------------------------------------------------

 

writings or by any combination thereof.  In the event that any provision of this
Agreement is invalid or unenforceable, the validity and enforceability of the
remaining provisions hereof shall not be affected.  Employee is entering into
this Agreement of his own free will and accord and has read this Agreement and
understands it and its legal consequences.

 

(f)                                   Notices.  All notices and other
communications hereunder shall be in writing and shall be given by hand delivery
to the other party or by registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:

 

If to Employee:

To the most recent address on file at the Company

 

 

If to the Company:

The Bon-Ton Department Stores, Inc.

 

2801 East Market Street

 

York, Pennsylvania 17402

 

Attention: Chief Executive Officer

 

or to such other address as either party shall have furnished to the other in
writing in accordance herewith.  Notices and communications shall be effective
when actually received by the addressee.

 

(g)                                  Counterparts.  This Agreement may be
executed in separate counterparts, including by facsimile and electronic
delivery, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.

 

(h)                                 Section 409A Compliance.  The parties intend
that all amounts payable under this Agreement comply with Section 409A of the
Code or an exemption therefrom, including regulations and guidance thereunder,
so as not to subject Employee to the payment of any additional taxes, penalties,
or interest imposed under Section 409A with respect to amounts paid under this
Agreement or any other agreement or arrangement between the parties.  The
parties agree to amend this Agreement to the extent necessary to bring this
Agreement into compliance with Code Section 409A (or to meet an exemption
therefrom) as it may be interpreted by any regulations, guidance, or amendments
to Section 409A issued or adopted after the date of this Agreement.  Nothing in
this Agreement shall be interpreted to permit (i) accelerated payment of
nonqualified deferred compensation, as defined in Section 409A, (ii) any other
payment in violation of the requirements of Section 409A, or (iii) Employee to
designate the taxable year of any payment.  No provision of this Agreement shall
be interpreted or construed to transfer any liability for failure to comply with
the requirements of Section 409A from Employee or any other individual to the
Company or any Affiliate, employee, or agent.  All taxes imposed on or
associated with payments made to Employee pursuant to this Agreement, including
any liability imposed under Section 409A (but excluding the employer portion of
any payroll taxes), shall be borne solely by Employee.

 

(i)                                     Confidentiality.  Notwithstanding any
disclosure by the Company of the fact or content of this Agreement, whether in
whole or in part, Employee hereby covenants and agrees that Employee shall keep
confidential this Agreement and the terms hereof, including the eligibility for
the Award and the amount thereof, except as required by applicable law. Further,
Employee may disclose to his/her attorney, his/her spouse, and his/her tax and
financial advisors

 

--------------------------------------------------------------------------------

 

the fact or content of this Agreement, provided the Employee obtains the
recipient’s agreement to keep this Agreement and its contents confidential.

 

IN WITNESS WHEREOF, Employee and the Company have each executed or caused the
execution of this Agreement, as applicable, as of the Effective Date.

 

 

COMPANY:

 

 

 

THE BON-TON DEPARTMENT STORES, INC.

 

 

 

By:

 

 

Name:

Denise M. Domian

 

Title:

SVP, Human Resources

 

 

 

 

 

EMPLOYEE:

 

 

 

 

 

--------------------------------------------------------------------------------