Exhibit 10.1

                                                                                                                                    May
2, 2012

 

Kenneth Hannah

 

Ken:

                                                            

Congratulations!  We are excited about the opportunity to work with you and
welcome you to the jcp team.    We are pleased to confirm our employment offer
for the position of EVP, Chief Financial Officer.  You will report to Michael
Kramer, COO.   Your start date will be Monday, May 7, 2012.

 

Salary Compensation

This position is offered to you at an annualized base salary of $850,000.   In
addition, subject to the terms and conditions of the attached jcpenney Signing
Bonus Agreement, we are offering you a one-time cash bonus of $2,000,000.
  Additional compensation components are outlined below.

 

Annual Performance-Based Incentive

You are eligible to participate in an annual performance-based incentive
compensation program.  Your target incentive opportunity is 80% of your base
salary and your maximum incentive opportunity is 160% of your base salary.
 Assuming employment for a full fiscal year, your incentive compensation amount
at target would be $680,000, for total earnings of $1,530,000.   The maximum
incentive compensation amount would be $1,360,000 for total earnings of
$2,210,000.  

 

Your incentive compensation under this program for the 2012 fiscal year will be
prorated based upon the actual number of months you are participating in the
program.    

 

Long-Term Incentive Compensation

You will receive an equity award having a fair market value of $2,500,000 on the
date of grant.  The award will be delivered 100% in time-based restricted stock
units.  The award will vest 100% on the third anniversary of the grant
date.  The vesting of awards is contingent on your active employment with the
Company on the applicable vesting date with no break in service.  In addition,
your equity award will fully vest if your employment terminates for any reason
other than your voluntary resignation (other than for “good reason” following a
change in control) or as a result of a summary dismissal as defined in the award
agreement. 

 

Your equity award grant date is the third full trading date following the date
of public release of Company earnings for the fiscal quarter in which employment
begins.  If that date occurs during a blackout period in which Company insiders
are prohibited from trading in the Company’s stock, your grant date will be the
first trading date following the end of the blackout period.

 

Financial Counseling Program and Health Exam

As an officer of the Company, you are eligible to participate in the Financial
Counseling Program and receive an annual Health Exam.  The Company offers the
Financial Counseling Program to provide you with the means to deal with the
complexities of your personal financial matters.  You may select any firm for
financial counseling, keeping within the Company guidelines.  The Company will
pay up to $14,500 as a first-year fee and up to $10,000 annually for each
succeeding year to cover the financial counseling firm’s fees.  The Company will
also provide you with an allowance of up to $3,000 for an annual health exam.

 

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Other Programs

You are eligible for the Company’s Executive Termination Pay Agreement and the
2011 Change in Control Plan.  Both documents are attached.  Please contact Brynn
Evanson, VP Compensation and Benefits, with any questions at 972-431-2629 or
bevanson@jcp.com.

 

Non-Competition and Other Restrictions

This offer is based on the assumption that you are not subject to any
non-compete or other covenant that could restrict your ability to assume your
job responsibilities with us.  Please confirm whether or not you have any such
restrictions and if so, please provide us with a copy of any such restrictions
as soon as possible.  If you are under any non-compete or other similar
restrictions, this offer may be withdrawn or modified.

 

The employment relationship existing between jcpenney and its employees is
employment-at-will.  Under this relationship, jcpenney may, at any time, decide
to end an individual’s employment with or without cause, prior notice or
discipline at jcpenney sole discretion.  Likewise, any employee is free to end
his or her employment at any time for any reason with or without notice.

 

All jcpenney associates must sign a mandatory arbitration agreement at the start
of their employment.  You should review the Arbitration Agreement and Rules
before your first day of employment and freely discuss any concerns with your
attorney. This agreement can be found at
www.jcpenney.net/associate_arbitration_agreement.

 

We are excited to have you join our jcpenney team and look forward to partnering
with you to become America’s Favorite Store!

 

Regards,

 

/s/DEWalker

 

Dan Walker
Chief Talent Officer

M 949.374.3402

jcpenney  .  jcp.com 
6501 Legacy Drive

Plano,  TX,  75024 

 

 

My signature acknowledges that I am accepting your offer of employment as
outlined in the offer letter. I acknowledge that this is not a contract of
employment.

 

Name (Print):       Ken Hannah        

 

Signature:            /s/ Ken Hannah  

 

Date:                    5/3/12                    

 

 

 

 

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J. C. Penney Company, Inc.

AGREEMENT TO RESPECT CONFIDENTIAL INFORMATION

 

 

Congratulations and welcome to jcpenney!  We are pleased and excited that you
have agreed to join our team.  With your help, we will accelerate our growth and
become America’s Favorite Store!

 

While you have been hired based on your prior accomplishments and experiences,
we ask that you do not bring any confidential business information with you from
any prior employer(s). Confidential information is information that may be
marked as “confidential”, “proprietary” or “privileged” or any other business
information that may not be known by the public.  While bringing such
information to jcpenney may seem innocent, doing so can expose both you and our
Company to civil and criminal liability.

 

The type of confidential information that should not be shared with us is the
same type of information that jcpenney would not want you to share with our
competitors.  If you have any questions whether the information you have from
any prior employer(s) is confidential information, please contact your Human
Resources Representative to discuss.         

   

Please sign below to acknowledge your understanding and agreement. 

   

Name (Print):       Ken Hannah        

 

Signature:            /s/ Ken Hannah  

 

Date:                    5/3/12                    

 

 

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J. C. Penney Company,  Inc.

Sign-On Bonus Addendum

 

In addition to your base salary, you will receive a one time signing bonus in
the amount of $2,000,000 less applicable taxes, within 30 days after your date
of hire.

 

By accepting this bonus and signing the agreement below, if you voluntarily
terminate your employment with jcpenney or your employment is terminated for
cause within 12 months of your start date, you agree to reimburse the Company
for a pro-rata portion of the signing bonus according to the following formula:

 

·

The amount of the Signing Bonus you will be required to reimburse jcpenney will
be determined by multiplying the portion of the Signing Bonus you received by a
fraction

o

The numerator of which is the number of whole calendar months that remain
between the date of your termination and the first anniversary of your start
date

o

The denominator of which is 12

·

You will not be required to reimburse jcpenney for any portion of your Signing
Bonus if your employment is involuntarily terminated by jcpenney for any reason
other than for Cause, or if your employment is terminated as a result of your
death, or disability

 

To the extent permitted by law, associate agrees that jcpenney may deduct
reimbursement payments from associate’s final paycheck and/or vacation payout.
If reimbursement payments are not timely paid, the Company shall be entitled to
recover reasonable collection agency fees and attorney's fees incurred by the
Company because of such noncompliance.

 

Name (Print):       Ken Hannah        

 

Signature:            /s/ Ken Hannah  

 

Date:                    5/3/12                    

 

 

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