Exhibit 10.2
January 7, 2009
Mr. David F. Dyer
300 Beach Drive N.E.
Apt. 2801
St. Petersburg, FL 33701
Dear Dave:
Please let this letter serve as an offer to join Chico’s FAS, Inc (the “Company”
or “Chico’s”). Your signature where indicated will signify your acceptance of
that offer. The following will outline the specifics:

     
Title:
  President and Chief Executive Officer
 
   
Reporting to:
  The Board of Directors
 
   
Base Salary:
  $950,000.00 annually
 
   
Start Date:
  January 7, 2009
 
   
Incentive Bonus:
  Range: 0-175% of base salary earned during the annual bonus period, which is
contingent upon the achievement of certain performance measures and goals
consistent with goals for other Chico’s executives such as Earnings Per Share,
Comparable Store Sales, Return On Invested Capital that are set at or near the
beginning of each year by the Company’s Compensation and Benefits Committee (the
“Plan”). The Target Bonus is 100% of base salary; threshold is 25%. Company
performance below levels established, however, will result in no bonus payout.
Achievement of results beyond the Plan level may pay up to 175% of base salary
actually earned during the year. Payouts normally occur at or around the time of
our earnings release in early March. The terms of the bonus, including
eligibility, payouts and objectives, may be modified from time to time.
 
   
Stock Options:
  A one-time grant of 600,000 non-qualified stock options with a grant date
consistent with the Company’s procedures for equity grants and a grant price as
follows:

 

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  •   200,000 options with an exercise price equal to the closing price of the
Company’s stock on the grant date,     •   200,000 options with an exercise
price equal to 125% of the closing price of the Company’s stock on the grant
date, and     •   200,000 with an exercise price equal to 150% of the closing
price of the Company’s stock on the grant date.

     
 
  These options will vest over a 3-year period with one-third of each tranche
vesting each year on the anniversary of the grant date and have a seven-year
term. These options are intended to be a multi-year grant. Therefore, unless the
Board of Directors determines otherwise, no additional options will be granted
for 3 years. Details of your option award will be set forth in a separate grant
certificate.
 
   
Performance Shares:
  The opportunity to earn shares of the Company’s common stock, contingent upon
the achievement of certain performance measures and goals over a three-year
period (2009-2011) as determined by the Company’s Compensation and Benefits
Committee. The Target number of shares is 300,000 with a range of 0-133% of
Target depending on the level of the achievement of the performance measures and
goals over the stated period. Details of your performance share award will be
set forth in a separate grant certificate.
 
   
Severance and Change of Control:
  If you are involuntarily terminated without “Cause,” or in the event of a
“Change of Control” resulting in your voluntary termination with “Good Reason,”
you may be entitled to the severance benefits set forth in Exhibit A to this
letter. Eligibility and key terms are defined in Exhibit A. As a condition to
receive the benefits listed in Exhibit A, you agree to execute the Company’s
Form of Waiver and Release substantially in the form of the agreement attached
as Exhibit B to this letter, Both parties acknowledge the inclusion of
Restrictive Covenants, including a non-competition covenant and a non-raiding
covenant, in Exhibit B.
 
   
Death/Disability:
  In the event of your death or permanent disability, you will be entitled to
the benefits set forth in Exhibit A to this letter. “Permanent

 

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  Disability” shall mean “disabled” as defined in Section 409A(a)(2)(C) of the
Internal Revenue Code of 1986, as amended (the “Code”).
 
   
Restrictive Covenants:
  In the event you violate any applicable restrictive covenant as set forth in
Exhibit B to this letter, you agree to the immediate forfeiture of any unvested
equity grants and the cancellation of all outstanding option grants. You also
agree that any gains on option exercises within 6 months of the violation of the
restrictive covenant are subject to claw-back. Forfeiture of equity grants and
option gains may also apply in the event grounds for a “cause” termination are
uncovered during the severance period.
 
   
409A Compliance:
  Notwithstanding any provisions of this letter to the contrary and, to the
extent applicable, this letter shall be interpreted, construed, and administered
(including with respect to any amendment, modification, or termination of the
letter), in such a manner so as to comply with the provisions of Code
Section 409A and any related Internal Revenue Service guidance promulgated
thereunder. In addition, for purposes of this letter, each amount to be paid or
benefit to be provided to you pursuant to the letter, which constitutes deferred
compensation subject to Code Section 409A, shall be construed as a separate
identified payment for purposes of Code Section 409A.
 
   
Delayed Payment:
  Notwithstanding anything in this letter to the contrary, in the event the you
are a “specified employee” (as such term is defined in Section 409A(a)(2)(B)(i)
of the Code), to the extent required in order to avoid accelerated taxation
and/or tax penalties under Section 409A of the Code, any payment due and payable
to the you hereunder as a result of your severance from service with the Company
shall not be made before the date which is six (6) months after such severance
from service.

You will also be eligible to participate in Chico’s FAS, Inc. comprehensive
benefits program outlined below:

     
Group Insurance Plan:
  Medical/Dental/Vision
 
   
 
  Notwithstanding anything in this letter to the contrary and regardless of the
reason for your termination from the Company, you will eligible to receive
continued health insurance benefits post-termination until you reach the age of
67; provided that you pay both the employee and

 

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  employer portion of premium post-termination, and provided further that
(i) benefits will be discontinued if and when you receive similar benefits from
another employer, and (ii) Chico’s will not be obligated to provide health
benefits to you if it no longer maintains a group health plan.
 
   
 
  Eligibility Date: Effective the first day of your active employment.
 
   
Life Insurance:
  Chico’s provides term insurance equal to 1X your base salary; in addition
Chico’s provides accidental death and dismemberment insurance equal to 1X your
base salary. Supplemental insurance is available for purchase.
 
   
 
  Eligibility Date: Effective the first day of your active employment.
 
   
401(k) Plan:
  Eligible deferral of 1-100% of your compensation (subject to an IRS maximum),
with a match of 50% of the first 6% of compensation you defer. You will be able
to roll over existing qualified funds immediately.
 
   
 
  Eligibility Date: First quarter after 12 months of employment.
 
   
Deferred
   
Compensation Plan:
  As a highly compensated associate of Chico’s, you will have the opportunity to
participate in the Chico’s Deferred Compensation Plan and to defer pre-tax
compensation (less applicable FICA/Medicare tax withholding). You may defer up
to 80% of your base salary payable during 2009, and up to 100% of your bonus
paid for 2009, payable in March 2010 in accordance with the terms of the plan.
 
   
 
  Eligibility Date: Immediately upon hiring.
 
   
Stock Purchase Plan:
  To the extent made available to other officers of Chico’s, the opportunity to
purchase Chico’s stock directly from the Company for a discount, two times a
year, in March and September.
 
   
 
  Eligibility Date: First offering period following one year of employment.

We hope you view this opportunity as a chance to have a positive impact on
Chico’s while enjoying a challenging and rewarding career. Nonetheless, please
understand that Chico’s FAS, Inc. is an at-will employer, meaning that either
you or Chico’s (subject to severance benefits outlined in Exhibit A) are free to
end the employment relationship at any time, with or without notice or cause.

 

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Please indicate your acceptance of our offer by signing below and returning to
my attention. By signing this letter you warrant your acknowledgement the
at-will nature of our relationship, and that you are not a party to any
agreement that would bar or limit the scope of your employment with Chico’s.
Dave, we are looking forward to having you on our Chico’s team. Let me be the
first to welcome you aboard! We are sure you will find it a challenging and
rewarding experience.
If you have any questions, please feel free to call me at your convenience.
Very truly yours,
/s/ Ross Roeder
Ross Roeder
Chico’s FAS, Inc.
Accepted by:

     
/s/ David F. Dyer
  January 7, 2009
 
   
David F. Dyer
  Date

 

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EXHIBIT A
In the event of your involuntary termination without Cause, as defined below,
other than a termination within 24 months following a Change in Control (defined
below), you will be entitled to the following:

  1)   If termination occurs within the first year of employment, payments equal
to two (2) times the sum of base salary and target bonus, payable in monthly
installments over two years. Payments will commence on the thirty-fifth (35th)
day following your termination of employment, provided that (i) you have
executed the waiver and release agreement, and (ii) the required revocation
period has expired.     2)   If termination occurs after the first year of
employment, payments equal to the sum of base salary and target bonus, payable
in monthly installments over one year. Payments will commence on the
thirty-fifth (35th) day following your termination of employment, provided that
(i) you have executed the waiver and release agreement, and (ii) the required
revocation period has expired.     3)   A pro-rated bonus for the applicable
bonus period based on actual company performance that would otherwise have been
payable to you. Payments will be made after year-end results are measured, but
in no event later than two and one-half months after the end of the year.     4)
  A pro-rata vesting of stock options based on the amount of time worked through
termination date. You may exercise any vested options for three years after
termination or the remaining term of the options, whichever is less.     5)   A
pro-rata number of Performance Shares based on the shares that would have been
earned at end of original performance period, pro-rated based on time worked
through termination date. These shares will be paid as soon as possible after
the end of the original performance period, but in no event later than two and
one-half months after the end of such performance period.     6)   Continued
health insurance coverage until age 67 provided that you pay both the employee
and employer portion of premium post-termination, and provided further that
(i) benefits will be discontinued if an when you receive similar benefits from
another employer, and (ii) Chico’s will not be obligated to provide health
benefits to you if it no longer maintains a group health plan; all other
benefits continued for one year post-termination.

 

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  7)   All severance benefits are specifically conditioned on the Company
receiving a signed waiver and release agreement from you as well as your
continued compliance with the restrictive covenants.

“Cause” shall mean the occurrence of any of the following:

  1)   Your conviction of, or entering a plea of no contest to, any felony;    
2)   Your conviction of, or entering a plea of no contest to, any crime related
to your employment by the Company, but specifically excluding traffic offenses;
    3)   Your continued willful neglect of, refusal to perform, or gross
negligence concerning, your duties, or engaging in willful misconduct in the
performance of your duties, which has a material adverse affect on the Company;
    4)   Your willful failure to take actions that are permitted by law and
necessary to implement policies of the Company’s Board of Directors which the
Board of Directors has communicated to you in writing, provided that minutes of
a Board of Directors meeting that are provided to or made available to you shall
be deemed communicated to you;     5)   Your material breach of the terms of the
attached letter agreement; or,     6)   Drug or alcohol abuse by you, but only
to the extent that such abuse has an obvious and material adverse affect on the
Company or on the performance of your duties and responsibilities under this
Agreement.

provided; however, that Cause shall not be found in any of the circumstances set
forth above (other than in subparagraph (1), or (2) above or where the basis for
the Cause determination is incapable of being cured) unless the relevant act or
failure to act is not cured by you within ten (10) business days after the
Company gives you written notice setting out a clear description of the
circumstances alleged by the Company to constitute Cause hereunder.
In the event of your involuntary termination without Cause, or your voluntary
termination with “Good Reason,” as defined below, in either case within
24 months following a Change in Control (CIC), you will be entitled to the
following:

  1)   An amount equal to two (2) times the sum of base salary and target bonus,
payable in a lump sum. Payments will be made on the thirty-fifth (35th) day
following your

 

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      termination of employment, provided that (i) you have executed the waiver
and release agreement, and (ii) the required revocation period has expired.   2)
  A pro-rata vesting of stock options based on the amount of time worked through
termination date. You may exercise any vested options for three years after
termination or the remaining term of the options, whichever is less.     3)  
Performance Shares — Upon a CIC, any unvested performance shares will be
converted, without pro-ration, to time vested restricted stock units, with the
number of restricted stock units based upon performance to the date of the CIC.
In the event of your involuntary termination without “Cause” or your termination
with “Good Reason,” as defined below, in either case within 24 months following
the CIC, vesting of these restricted stock units will be accelerated and you
will receive delivery of the shares within 60 days following such termination of
employment.

“Good Reason” shall mean, without your express written consent, the occurrence
of the following events, unless such events are corrected in all material
respects by the Company within 30 days of your written notification to us that
you intend to terminate your employment for “Good Reason and provided that you
gave the Company notice within 90 days of the initial existence of such
conditions:”

  1)   Any material reduction in your then current titles or positions, or a
material reduction in your then current duties or responsibilities; or     2)  
Your failure to be re-elected or re-appointed to the Company’s Board of
Directors.

In the event of your death or “Permanent Disability”, as defined in
Section 409A(a)(2)(C) of the Internal Revenue Code of 1986, as amended (the
“Code”), You or your beneficiaries will be entitled to the following:

  1)   All accrued but unpaid compensation.     2)   A pro-rata vesting of stock
options based on the amount of time worked through your last date of employment.
You or your beneficiaries may exercise any vested options for one year after
your death or Permanent Disability or the remaining term of the options,
whichever is less.     3)   Continued health insurance coverage until age 67
(or, in the case of death, until executive would have reached age 67) as set
forth in the Letter; such benefits to be mitigated by similar benefits provided
by new employer; all other benefits continued for one year post-termination.

 

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A “Change in Control” shall mean:

  A)   any “person” or “group” as such terms are used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934 (“Act”) becomes the “beneficial
owner” (as defined in Rule 13d-3 under the Act), directly or indirectly, of
securities of the Company representing thirty-five percent (35%) or more of the
combined voting power of the Company’s then outstanding securities;     B)  
during any one-year period, individuals who at the beginning of such period
constitute the Board of Directors, and any new director who is elected or
nominated by the Board by a vote of at least two-thirds of the directors then
still in office who either were directors at the beginning of the one-year
period or whose election or nomination was previously so approved, cease to
constitute at least a majority of the Board;     C)   a merger or consolidation
of the Company with any other entity, other than a merger or consolidation which
would result in the voting securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) more than fifty
percent (50%) of the combined voting power of the voting securities of the
surviving entity or its ultimate parent outstanding immediately after such
merger or consolidation; or     D)   the sale or disposition of all or
substantially all of the Company’s assets.

Provided that a “Change in Control” shall not be deemed to have occurred unless
it is a “change in control” within the meaning of Section 1.409A-3(i)(5) of the
Treasury Regulations.

 

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EXHIBIT B
Confidential Executive Separation Agreement And Release
     This Confidential Executive Separation Agreement and Release (“Agreement”)
is entered into between Chico’s FAS, Inc., its subsidiaries and affiliates,
including but not limited to Chico’s Retail Services, Inc., White House | Black
Market, Inc., Chico’s Distribution Services, LLC, SOMA by Chico’s, LLC and
FitAppCo, LLC (collectively referred to in this Agreement as the “Company”) and
___(“Executive”).
     Executive’s employment by Company as its ___has been terminated effective
___(“Termination Date”). Company and Executive wish to provide for the payment
of severance pay to Executive and the final settlement of all claims that
Executive may have against Company and any of the other Released Parties named
in this Agreement, including but not limited to claims arising out of his
employment by Company and claims alleging an ownership interest in Company.
Therefore, Company and Executive agree as follows:
1. Termination of Employment
     Executive acknowledges that his employment by Company has been terminated
effective at the close of business on the Termination Date. He acknowledges that
he has received all of his accrued salary and vacation pay up to and including
that date. He shall not receive or accrue any salary or benefits after that
date.
2. Severance Payments
     Company shall pay Executive severance payments and benefits in the amount
and manner outlined in the Letter Agreement dated January 7, 2009.
3. General Release
     In exchange for the payments described in paragraph 2 above, Executive, on
behalf of himself, his heirs, executors, administrators, successors and assigns,
releases and waives any claims, charges, complaints, liabilities, obligations,
promises, agreements, causes of action, rights, costs, losses, debts and
expenses of any nature whatsoever, known or unknown, of any kind that he or his
heirs, executors, administrators, successors and assigns had, now have or
hereafter can, will or may have (either directly, indirectly, derivatively or in
any other representative capacity) by reason of any matter, fact or cause
whatsoever (the “Claims”) against, (a) Company and its subsidiaries and
affiliates, including but not limited to Chico’s Retail Services, Inc., White
House | Black Market, Inc., Chico’s Distribution Services, LLC, SOMA by Chico’s,
LLC and FitAppCo, LLC; (b) the owners, shareholders, employees, officers,
managers, supervisors, directors, agents, attorneys, partners, joint ventures,
predecessors, successors and assigns of Company and its subsidiaries and
affiliates; and (c) the employee benefit plans and plan administrators and
fiduciaries of Company and its subsidiaries and affiliates (collectively
referred to in this Agreement as the “Released Parties”) from the beginning of
time through the date upon which he signs this Agreement. Notwithstanding the
foregoing, nothing herein shall be considered as releasing; (i) any rights that
Executive may have to indemnification and directors and officers liability
insurance coverage; (ii) Executives’ right to enforce the terms of this
Agreement; (iii) any rights that cannot be waived under applicable law; or
(iv) any rights to workers’ compensation or unemployment insurance benefits.
     This General Release waives all Claims of any kind that Executive may have
against the Released Parties from the beginning of time through the date upon
which Executive signs this Agreement, including any Claim arising out of

 

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(a) Executive’s employment by Company or the termination of that employment;
(b) an alleged ownership interest in Company; (c) any express or implied
contract; (d) any public policy violation or other tort; (e)any federal, state
or local constitution, statute, regulation or ordinance (including statutory
attorneys’ fees); or (f) any other law of any kind. It expressly waives all
Claims under the Age Discrimination in Employment Act, Title VII of the Civil
Rights Act, the Americans with Disabilities Act, the Fair Labor Standards Act,
the Worker Retraining and Notification Act, the Employee Retirement Income
Security Act, and the Florida Civil Rights Act of 1992 (often referred to as the
Florida Civil Human Rights Act). Executive represents that he has not filed
against the Company or any of the Released Parties any complaints, charges or
lawsuits arising out of his employment by the Company, or any other matter
arising on or prior to the date he signs this Agreement. Executive covenants and
agrees that he will not seek any personal recovery against the Company or any of
the Released Parties arising out of any of the matters set forth in this
paragraph 3.
4. Knowing and Voluntary Waiver
     By signing this Agreement, Executive acknowledges the following:
     (a) He has read and understands this Agreement.
     (b) He understands that the General Release set forth above waives rights
or claims arising under the Age Discrimination in Employment Act.
     (c) He understands that he is not waiving any rights or claims under the
Age Discrimination in Employment Act that may arise after the date on which he
signs this Agreement.
     (d) He was not already entitled to the severance payments described above,
and they are consideration in exchange for his waiver of rights or claims in
this Agreement.
     (e) He is advised that he should consult with an attorney prior to signing
this Agreement.
     (f) He understands that he has a period of 21 days to consider this
Agreement before signing it.
     (g) He understands that he has a right to revoke this Agreement for seven
days after signing it, and that it will not become effective or enforceable
until that period has expired. To be effective, any revocation must be, in
writing, to the Chief Human Resources Officer for the Company, and state, “I
hereby revoke my acceptance of our Confidential Executive Separation Agreement
and Release.” The revocation must be personally delivered to the Chief Human
Resources Officer for the Company, or his designee, or mailed to the Chief Human
Resources Officer for the Company and postmarked within seven calendar days of
execution of this Agreement. This Agreement and General Release shall not become
effective or enforceable until the revocation period has expired.
     (h) Revisions to this Agreement do not restart the 21 period set forth in
this Section.
5. No Assignment of Claims
     Executive represents and warrants that he has not transferred or assigned
to any other person or entity any of the claims that are waived or released by
him in the General Release set forth above.
6. Non-Disclosure and Code of Ethics Agreements

 

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     Executive acknowledges that he has surviving obligations under the Code of
Ethics and the Non-Disclosure Agreement that he previously signed, which are
incorporated into this Agreement by reference, and he agrees to comply with all
of such obligations. Executive acknowledges that the Non-Disclosure Agreement
prohibits him from using or disclosing, in any way, information relating to the
compensation or contact information of current or former employees of the
Company.
7. Employment with a Competitor
     Executive understands if he begins to work for a Direct Competitor of the
Company, as an employee, director, or contractor, within twelve months from the
Effective Date of this Agreement, he must immediately notify the Chief Human
Resources Officer for the Company. Executive also understands if he does begin
such work, all remaining severance payments under Section 2, above, will end.
For the purposes of this Agreement, Direct Competitors of the Company are
specifically defined as ___, ___, ___and ___. [Company to insert named
competitors].
8. Confidentiality
     Executive agrees that he will not disclose the terms of this Agreement to
anyone except his accountant or attorney, unless he is required to do so by law
or court order. He further agrees that any disclosure of such terms by his
accountant or attorney will be deemed to be a breach of this covenant. Because a
breach of this covenant would result in damages that would be extremely
difficult to ascertain or calculate, liquidated damages in the sum of $10,000
shall immediately be due from Executive to Company if this covenant is breached.
9. No Disparagement
     Executive agrees that he will not disparage Company or any of the other
Released Parties in any communication, or make any statements that will reflect
negatively on or harm the business interests of any of them.
10. No Raiding
     Executive agrees that, for one year following the Effective Date of this
Agreement, he will not solicit or attempt to persuade any employee, consultant,
representative or agent of Company or any of its subsidiaries or affiliates to
terminate his or her employment or relationship with Company or its subsidiary
or affiliate. Executive acknowledges that the purpose of this covenant is to
enable Company and its subsidiaries and affiliates to maintain a stable
workforce in order to remain in business, and that it would disrupt, damage,
impair and interfere with their business if he were to engage in such
solicitation.
11. Return of Company Property
     Executive acknowledges that he is required to return to Company all
property belonging to Company or its subsidiaries or affiliates, and he agrees
to do so promptly. This includes, but is not limited to, equipment, keys, credit
cards, files, records, documents, notes, computer records, intellectual property
and proprietary information of any kind. He further acknowledges that he is not
permitted to remove such property from the premises of Company or its
subsidiaries or affiliates or retain it in his possession, and he agrees not to
do so.
12. Restrictive Covenants

 

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     Executive agrees that should he violate any of the Restrictive Covenants
outlined in Paragraphs 6, 7, 9 and 10, herein, any unvested equity grants will
be immediately forfeited and all outstanding option grants will be cancelled. He
further acknowledges that any gains on option exercises within six months of the
violation of the Restrictive Covenant are subject to claw-back. These remedies
are in addition to any and all other legal remedies.
13. Future Employment
     Executive agrees that he will not apply for employment with Company or any
of its subsidiaries or affiliates at any time in the future.
14. Non-Admission of Liability
     Nothing in this Agreement shall be construed as an admission of liability
by Company or any of the other Released Parties.
15. Cooperation
     Executive agrees that, if any legal action is threatened or commenced
against Company or any of the other Released Parties, relating to events about
which he has knowledge, he will cooperate fully with them in the defense of such
action.
16. Entire Agreement
     With the exception of the Non-Disclosure Agreement and Code of Ethics
referred to above, this Agreement contains the complete and exclusive agreement
between Executive and Company related to the matters addressed herein, and it
supersedes any other agreements for understandings between them, whether oral or
in writing. Executive acknowledges that he has not relied on any oral
representations concerning the effect of this Agreement.
17. Amendments and Waivers
     This Agreement may be amended or modified, and its provisions may be
waived, only in a written instrument signed by Executive and Company.
18. Severability
     If any part of this Agreement is held to be unenforceable for any reason,
the other parts of the Agreement will remain in effect.
19. Governing Law
     This Agreement shall be governed by and construed under the laws of the
State of Florida, without regard to principles of conflict of laws.
20. Interpretation
     The rule of interpretation that ambiguities in an agreement are to be
construed against the party that drafted it shall not apply to this Agreement.

 

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21. Successors
     This Agreement shall be binding upon and inure to the benefit of the
parties and their heirs, successors and assigns.
22. Counterparts
     This Agreement may be executed in counterparts, and every signed
counterpart shall have the legal effect of an original document.
23. Attorneys’ Fees
     If any arbitration or other legal proceeding is commenced to enforce the
terms of this Agreement, the prevailing party shall be entitled to the payment
of its reasonable attorneys’ fees and costs in the proceeding by the losing
party.
24. Effective Date
     This Agreement shall become effective upon the expiration of the seven-day
revocation period provided for above, unless Executive revokes it during the
revocation period.

          EXECUTIVE
    By:                               Dated:         

          CHICO’S FAS, INC.
    By:         Manuel Jessup      Chief Human Resources Officer           
Dated: