ex10_1.htm


  
    Exhibit
10.1

    


    Execution
Version

    


    AMENDMENT
NO. 1

    TO

    EMPLOYMENT AGREEMENT OF
TRUDY F. SULLIVAN

     

     

    THIS
AMENDMENT NO. 1 (this “Amendment”), dated as of June 16, 2009, to the
Employment Agreement dated June 28, 2007 (the “Employment Agreement”), by and
between The Talbots, Inc., a Delaware corporation (the “Company”), and Trudy F.
Sullivan (the “Executive”).

     

    WHEREAS,
Section 5(c) of the Employment Agreement currently provides, prior to this
Amendment, that “In the event the Company materially reduces or discontinues the
Executive’s benefits under the defined benefit SERP, the Company shall provide
Executive with substantially comparable benefit(s) in replacement for the
reduced or discontinued benefits, as reasonably determined by the Compensation
Committee with the assistance of its outside compensation consultant.”;
and

     

    WHEREAS,
the Company has recently amended The Talbots, Inc. Pension Plan, which is its
tax-qualified defined benefit pension plan (“Qualified Defined Benefit Plan”),
and The Talbots, Inc. Supplemental Executive Retirement Plan, which is its
nonqualified defined benefit plan (the “defined benefit SERP”), to discontinue
all future benefit accruals under the Qualified Defined Benefit Plan and the
defined benefit SERP for all participants, including the Executive, effective as
of May 1, 2009; and

     

    WHEREAS,
pursuant to current Section 5(c) of the Employment Agreement, the Company has
agreed to provide the Executive with a substantially comparable benefit (as
provided below, the “Replacement Benefit”) in replacement for and as a result of
the above cessation of future benefit accruals under the defined benefit SERP;
and

     

    WHEREAS,
the Replacement Benefit reflects the Compensation Committee’s consideration,
with its outside compensation consultant, of a “discounted” or reduced net
present value calculation to reflect a buyout of the Executive’s future benefit
accrual rights which were eliminated by reason of the Company’s freeze of the
Qualified Defined Benefit Plan and defined benefit SERP, including assumptions
concerning future potential compensation levels and periods of employment for
which future benefit accruals could have been earned were it not for the
freezing of such plans; and

     

    WHEREAS,
the Executive agrees that the Replacement Benefit provides substantially
comparable benefits in replacement for the discontinuance of future benefits
that might otherwise have accrued to Executive under the defined benefit SERP
for periods beginning on and after May 1, 2009; and

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

     

    WHEREAS,
in consideration of the Replacement Benefit, the Executive agrees to waive and
release the Company and its parent entities, affiliates, officers, directors and
employees (including, without limitation, the Company’s employee benefit plans
and the trustees, fiduciaries and administrators of those plans, and all persons
acting under, by, through or in concert with any of them) from any and all known
or unknown actions, causes of action, claims or liabilities of any kind that
have or could be asserted against the Company arising out of or related to the
subject matter of this Amendment, including without limitation any such claim or
liability relating to the Replacement Benefit or Section 5(c) of the Employment
Agreement as in effect prior to this Amendment;

     

    NOW,
THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, the parties agree as follows:

     

    1.           
 Capitalized terms in this Amendment have the meanings defined in the
Employment Agreement.

     

    2.         
   Section 5 of the Employment Agreement is amended by deleting
subsection (c) and inserting the following new subsection (c):

     

    “(c)           Retirement
Benefits.  Executive will be eligible to participate in the
Company’s existing tax-qualified retirement plans and the Company’s defined
contribution supplemental retirement plan (“defined contribution SERP”) and
defined benefit supplemental retirement plan (“defined benefit SERP”), if and to
the extent that any such plan is then in effect and in accordance with the terms
and conditions as then in effect, provided
however, that except as provided in Section 5(e) below, Executive shall
not be entitled to accrue any additional benefits under the Company’s
tax-qualified defined benefit retirement plan or defined benefit SERP beginning
May 1, 2009.”

     

    3.        
    Section 5 of the Employment Agreement is amended by adding
the following new subsection (e):

     

    “(e)           Defined Benefit SERP
Replacement Benefit. In order to compensate Executive for the cessation
of future benefit accruals under the defined benefit SERP beginning May 1, 2009,
the Company shall make cash payments to Executive in the total amount of
$1,200,000 (the “Replacement Benefit”), which shall be payable in six equal
monthly installments of $200,000 over a six month period, with the first such
payment to be made on June 18, 2009 and subsequent payments to be made on or
about the same date (in accordance with normal payroll practices and subject to
all applicable withholdings) on each of the following five months (together, the
“Replacement Benefit Payment Dates”). Executive agrees that the Replacement
Benefit provides her with substantially comparable benefits in replacement for
the discontinuance of future benefits that may have accrued to Executive under
the Company’s existing tax-qualified defined benefit retirement plan and defined
benefit SERP for periods beginning on and after May 1, 2009. Executive shall be
required to be employed by the Company on a Replacement Benefit Payment Date in
order to be entitled to payment hereunder on such date, unless her employment
has been terminated prior to such date due to death or Disability, by the
Company without Cause or by the Executive for Good Reason.”

     

    
      
         

      

      
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    4.
            Section 6 of
the Employment Agreement is amended by deleting subsection (a)(vi), and
inserting the following new subsection (a)(vi):

     

    “(vi)         vesting
of Executive’s accrued benefit in effect as of May 1, 2009 under the defined
benefit SERP, to the extent not then vested.”

     

    5.
            Section 6 of
the Employment Agreement is amended by deleting subsection (d)(v), and inserting
the following new subsection (d)(v):

     

    “(v)          Executive’s
accrued benefit in effect as of May 1, 2009 under the defined benefit SERP will
be vested (and the Company agrees to cause plan changes to be made to give
effect to this);”

     

    6.
            The
definition of the term Good Reason contained in Section 6 of the Employment
Agreement is amended by deleting subsection (iv) from the definition of such
term in its entirety and inserting in its place, “(iv) [INTENTIONALLY
OMITTED]”.

     

    7.             Section
6 of the Employment Agreement is amended by deleting subsection (e)(v), and
inserting the following new subsection (e)(v):

     

    “(v)          Executive’s
accrued benefit in effect as of May 1, 2009 under the defined benefit SERP will
be vested (and the Company agrees to cause plan changes to be made to give
effect to this);”

     

    8.              Executive
agrees that the definition of the term Good Reason as amended by paragraph 6 of
this Amendment shall constitute the definition of the term Good Reason under the
Nonqualified Stock Option Agreement and the Restricted Stock Agreement, each
dated August 7, 2007 between the Company and Executive.

     

    9.              The
parties agree that nothing contained herein shall affect the accrued benefits
earned by Executive under the Qualified Defined Benefit Plan and the defined
benefit SERP prior to May 1, 2009, and further agree that, except as expressly
set forth in Section 6(a), 6(d) or 6(e) of the Employment Agreement as amended
by this Amendment, such benefits will continue to vest and be paid in accordance
with the terms and conditions of those plans (as they may be amended from time
to time).

     

    10.            Subject
to the Company satisfying its obligations under new Section 5(e) as set forth
under paragraph 3 of this Amendment, Executive on behalf of herself and heirs,
executors, administrators and assigns, intending to be legally bound, hereby
waives, releases and discharges the Company, and all of its past and present
affiliates, and their respective divisions, parents, successors, subsidiaries,
and related companies, and their respective directors, officers, agents,
employees, shareholders, partners, employee benefit plans and the trustees,
fiduciaries and administrators of those plans, and all persons acting under, by,
through or in concert with any of them, from any and all known or unknown
actions, causes of action, claims or liabilities of any kind that have or could
be asserted against the Company arising out of or related to the subject matter
of this Amendment, including without limitation any such claim or liability
relating to the Replacement Benefit or Section 5(c) of the Employment Agreement
as in effect prior to this Amendment.

     

    
      
         

      

      
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    11.            This
Amendment may be executed in counterparts, each of which shall be deemed an
original but all of which taken together will constitute one
instrument.

     

    12.            This
Amendment embodies the entire agreement and understanding of the parties with
respect to the subject matter hereof and supersedes any and all prior
agreements, arrangements and understandings, written or oral, relating to the
matters provided for herein, provided
however, that the parties hereto agree that except as expressly modified
by this Amendment, all terms and provisions of the Employment Agreement and all
the respective rights and obligations of the parties to the Employment Agreement
shall continue unchanged and in full force and effect.

     

     

     

    IN
WITNESS WHEREOF, the parties have duly executed this Amendment as of the date
first written above.

     

    
      
        	
                /s/
      Trudy F. Sullivan

              	 
      	
                THE
      TALBOTS, INC.

                 

                /s/
      Michael Scarpa

              
	
                TRUDY
      F. SULLIVAN

                 

              	 
      	
                Name:
      Michael Scarpa

                 

              
	Dated:
      June
      16, 2009	 
      	
                Title:
      Chief Operating Officer, Chief Financial

                          Officer,
      and Treasurer

              
	 	 	 
	 
      	 
      	Dated:
        June
      18,
2009


      

    

     

     

     

     

     

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