Exhibit 10.1

 

AMENDMENT NO. 4 TO

 

EXECUTIVE TRANSITION AGREEMENT

 

THIS AMENDMENT NO. 4 is effective as of the 5th day of May, 2017, between The
Bon-Ton Stores, Inc., a Pennsylvania corporation (the “Company”), and Mr. M.
Thomas Grumbacher (the “Executive”).

 

WHEREAS, the Company and the Executive are parties to an Executive Transition
Agreement effective as of February 1, 2005;

 

WHEREAS, as of December 6, 2007, the Company and the Executive entered Amendment
No. 1 to the Executive Transition Agreement extending its term until January 31,
2010, and making certain other changes;

 

WHEREAS, as of February 1, 2010, the Company and the Executive entered into
Amendment No. 2 to the Executive Transition Agreement (“Amendment No. 2”)
extending its term until December 31, 2010, and making certain other changes;
and

 

WHEREAS, as of December 20, 2010, the Company and the Executive entered into
Amendment No. 3 to the Executive Transition Agreement (“Amendment No. 3”)
extending its term until February 5, 2012 and for successive one-year periods
and making certain other changes;

 

WHEREAS, the parties wish to amend the Transition Agreement, as amended (with
all amendments, the “Transition Agreement”), to extend its term, to provide for
a change in position and duties, and to make certain other changes.

 

NOW, THEREFORE, for good and valuable consideration, the receipt of which is
hereby acknowledged, the parties hereby agree as follows:

 

1.                                      Capitalized Terms.  Unless otherwise
defined herein, capitalized terms used herein shall have the respective meanings
ascribed to such terms in the Transition Agreement.

 

2.                                      Amendments to Transition Agreement.  The
Transition Agreement is hereby amended, as follows:

 

(a)                                 Section I of the Transition Agreement is
hereby amended by deleting the existing section and substituting the following:

 

“Term.  The term of the Executive’s service hereunder shall commence as of
February 1, 2005 (the “Effective Date”) and shall remain in effect through
February 1, 2018, or until such earlier time at which the Executive ceases to
serve as Chairman Emeritus and Advisor to the Chief Executive Officer (the
“Term”).  The Term shall automatically renew for successive periods of one year
unless either party shall give written notice to the other party not less than
60 days prior to the end of the then current Term that it does not wish to renew
the Transition Agreement.”

 

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(b)                                 Section II of the Transition Agreement is
hereby amended by deleting the existing section and substituting the following:

 

“Position and Duties.  During the Term, Executive shall serve as Chairman
Emeritus and Advisor to the Chief Executive Officer of the Company.  In such
role, the Executive shall perform such duties that are appropriate for such role
as the Board may assign in its reasonable discretion from time to time, and it
is understood that Executive’s duties, authority and responsibilities in such
role shall be governed by and subject to the applicable provisions of the
Company’s “Governance Policies and Procedures” adopted by the Board, as the same
may be in effect from time to time.”

 

(c)                                  Section III.A of the Transition Agreement
is hereby amended by deleting the existing section and substituting the
following:

 

“A.                              Base Salary.  Effective as of the date of this
Amendment No. 4 and for each fiscal year of the Company (each, a “Fiscal Year”)
during the Term, the Executive shall receive a base salary at the rate of
$450,000 per year (“Base Salary”), payable in accordance with the Company’s
normal payroll practices.”

 

(d)                                 Section IV.A of the Transition Agreement is
hereby amended by deleting the existing section and substituting the following:

 

“A.                              Medical Insurance.  During the Term, the
Executive and his eligible dependents shall be eligible to participate in the
Company’s group medical plans in accordance with the terms of such plans and
subject to the restrictions and limitations contained in the plans or applicable
insurance or agreements.  Following the cessation of the Executive’s service as
Chairman Emeritus and Advisor to the Chief Executive Officer for any reason, the
Executive (for the duration of his lifetime) and his wife Debra Simon (for the
duration of her lifetime) shall be reimbursed for the costs actually incurred by
them (or either of them following the death of the other) for the purchase of
health coverage generally similar to the coverage available to active employees
of the Company; provided, however, that any such coverage shall be of a type
that is coordinated with and pays secondarily after benefits the Executive
and/or Ms. Simon are entitled to receive from the U.S. government (such as
Medicare coverage), or, in the alternative, if possible, the Company shall
purchase such a policy for the Executive and/or Ms. Simon, as applicable.
Reimbursements to the Executive and/or Ms. Simon shall be paid to them on
provision of appropriate documentation indicating the amounts actually paid by
the Executive and/or Ms. Simon, and shall be paid at a time and in a manner that
is consistent with the requirements set forth in Treasury Regulation Section
1.409A-3(i)(1)(iv) (that permits certain arrangements that call for the payment
of reimbursements or the provision of in-kind benefit plans to be treated as
creating a fixed schedule of payments as permitted with regard to nonqualified
deferred compensation plans subject to Code Section 409A). In addition, in the
event the arrangement is treated as creating a tax liability for the Executive
(and/or Ms. Simon), such tax liability shall be “grossed up” (i.e., the Company
shall pay to Executive and/or Ms. Simon, as applicable, an additional payment
(the “Gross Up Payment”) in an amount that is sufficient so that, after payment
of all tax liabilities attributable to the Gross Up Payment itself, Executive
and/or Ms. Simon, as

 

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applicable, shall have an amount that is sufficient to pay the tax liability
attributable to the benefit arrangement) and payments of any such amounts as are
required to be paid as such a gross up shall be paid consistent with the
requirements of Treasury Regulation Section 1.409A-3(i)(1), including provisions
regarding tax gross-up payments. The Company shall continue to provide the
Executive with the Pinnacle Care Plan (or similar coverage) through the date of
Executive’s cessation of service as Chairman Emeritus and Advisor to the Chief
Executive Officer, and the Company shall continue to provide such coverage (or
similar coverage) at no cost to either the Executive or Mr. Simon for the
lifetime of each of them, but only if such coverage is available and does not
violate any applicable law, including, but not limited to, provisions of law
enacted as part of federal healthcare reform legislation.”

 

(e)                                  Section IV.B of the Transition Agreement is
hereby amended by deleting the existing section and substituting the following:

 

“B.                              Other Benefits.  During the Term, the Executive
shall be eligible to participate in the Company’s tax-qualified retirement
plans, discount program, life insurance, long-term disability plan and other
employee benefit program generally made available to executives of the Company,
subject to their respective generally applicable eligibility requirements, terms
and conditions and restrictions; provided however, that the Executive shall not
participate in any nonqualified excess or supplemental retirement plan or
severance plan of the Company.  The Company’s obligations under this provision
shall not apply to any insurance benefit program or plan made available on an
individual basis to one or more select executive employees by contract if such
insurance benefit program or plan is not made available to all executive
employees.  During the Term, the Company will pay for the maintenance and
gasoline for the Executive’s car.”

 

(f)                                   Section IV.C of the Transition Agreement
is hereby amended by deleting the existing section and substituting the
following:

 

“C.                              Expenses.  During the Term, the Executive shall
be entitled to receive prompt reimbursement for all reasonable and customary
expenses incurred by the Executive in performing services hereunder, including
all expenses of travel and living expenses while away from home on business or
at the request of and in the service of the Company (collectively, “Business
Expenses”), provided that such Business Expenses are incurred and accounted for
in accordance with the policies and procedures established by the Company.”

 

3.                                      Legal Fees.  The Company shall pay or
reimburse the Executive for all attorneys’ fees and other charges of counsel
reasonably incurred by the Executive in connection with the negotiation and
execution of this Amendment No. 4, promptly upon presentation of appropriate
supporting documentation and in accordance with the expense reimbursement policy
of the Company, up to an aggregate amount of $15,000.

 

4.                                      Full Force and Effect.  Except as
amended hereby, the Transition Agreement shall remain unchanged and in full
force and effect.

 

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IN WITNESS WHEREOF, the Company has caused this Amendment No. 4 to be duly
executed and the Executive has hereunto set his hand, effective as of the date
first set forth above.

 

 

 

THE BON-TON STORES, INC.

 

 

 

 

 

 

 

By:

/s/ Kathryn Bufano

 

Name:

Kathryn Bufano

 

Title:

President and Chief Executive Officer

 

 

 

 

 

 

 

EXECUTIVE

 

 

 

 

 

/s/ M. Thomas Grumbacher

 

M. Thomas Grumbacher

 

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