exv10w5






Exhibit 10.5




AMENDMENT NO. 1 TO




EMPLOYMENT AGREEMENT



AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT (“Amendment”), executed and effective as of December 19,
2008 by and between PAYLESS SHOESOURCE, INC., a Missouri corporation (“PSS”), and LUANN VIA
(“Executive”).



WHEREAS, PSS and Executive are parties to the employment agreement executed July 22, 2008
(“Employment Agreement”);



WHEREAS, in order to avoid certain adverse federal income tax consequences to Executive under the
Employment Agreement as a result of Section 409A of the Internal Revenue Code of 1986, as amended,
relating to deferred compensation, PSS desires to implement certain amendments to the Employment
Agreement; and



WHEREAS, PSS and Executive desire to amend the Employment Agreement.



NOW, THEREFORE:



Section 1. Amendment to Section 8(b)(viii). The following will be added at the end of
Section 8(b)(viii):





“such special payment will be paid by the later of (x) 2 1/2 months from the end of PSS’s
fiscal year in which Executive’s employment terminates and (y) April 15th of the
year following the year in which Executive’s employment terminates;”


Section 2. Amendment to Section 8(b)(x). Section 8(b)(x) shall be replaced in its
entirety with the following:




     “(x) [Intentionally omitted.]”


Section 3. Addition of Section 8(i). Section 8(i) shall be inserted as follows:





“(i) Executive may terminate her employment ‘for Good Reason,’ provided Good Reason exists
and Executive provides notice to Payless in compliance with Section 8(b). However, prior
to giving notice of termination of employment, (A) Executive must provide written
notification of her intention to resign within ninety (90) days after Executive knows of
the occurrence of any such event (‘Notice of Good Reason’) and Payless shall have thirty
(30) days from the date of receipt of such notice to effect a cure of the condition
constituting Good Reason under Section 8(b), and (B) if Payless is unable to cure the
condition constituting Good Reason within the thirty (30) day period then Executive must
terminate her employment within two (2) years from the date such event constituting Good
Reason occurred, otherwise the event will no longer constitute Good Reason. For the
avoidance of doubt, Good Reason will not include any isolated, insubstantial and
inadvertent failure by Payless that is not in bad faith and is cured promptly on
Executive’s giving Payless notice, and an event will



 









 







not constitute Good Reason if Executive has consented to it in accordance with Section 15.”


Section 4. Amendment to Section 9. The last sentence of Section 9 shall be replaced in
its entirety with the following:





“Provided, however, the payments of the amounts specified in Paragraph 8(b)(iv), (v),
(viii) and (ix) are conditioned on Executive’s delivery and non-revocation of a valid and
effective release, in substantially the form attached hereto as Appendix A within
fifty-five (55) days following the date of Executive’s termination from employment.”


Section 5. Amendment to Section 15. The first sentence of Section 15 shall be replaced in
its entirety with the following:





“This Agreement may not be changed, amended, or modified in any manner except by a written
instrument in writing signed by both the parties here, except as described in Section 19
herein.”


Section 6. Addition of Section 19. Section 19 shall be inserted as follows:





“Section 409A.




     (a) This Agreement is intended to satisfy the requirements of Section 409A of the
Internal revenue code of 1986, as amended (‘Section 409A’) with respect to amounts, if
any, subject thereto and shall be interpreted and construed and shall be performed by
the parties consistent with such intent. If either party notifies the other in writing
that, based on the advice of legal counsel, one or more or the provisions of this
Agreement contravenes any Treasury Regulations or guidance promulgated under Section
409A or causes any amounts to be subject to interest, additional tax or penalties under
Section 409A, the parties shall promptly and reasonably consult with each other (and
with their legal counsel), and shall use their reasonable best efforts to reform the
provisions hereof to (a) maintain to the maximum extent practicable the original intent
of the applicable provisions without violating the provisions of Section 409A or
increasing the costs to PSS of providing the applicable benefit or payment; provide,
however, de minimis costs associated with the implementation of such 409A reforms shall
be considered reasonable and not an increase under this subsection (a), and (b) to the
extent possible, to avoid the imposition of any interest, additional tax or other
penalties under Section 409A upon Executive or PSS.




     (b) To the extent Executive would otherwise be entitled to any payment under this
Agreement, or any plan or arrangement of PSS or its affiliates, that constitutes a
‘deferral of compensation’ subject to Section 409A and that if paid during the six (6)
months beginning on the date of termination of Executive’s employment would be subject
to the Section 409A, additional tax because Executive is a ‘specified employee’ (within
the meaning of Section 409A and as



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determined by PSS), the payment will be paid to Executive on the earlier of the
six (6) month anniversary of Executive’s date of termination or Executive’s death.




     (c) Similarly, to the extent Executive would otherwise be entitled to any benefit
(other than a payment) during the six (6) months beginning on termination of
Executive’s employment that would be subject to the Section 409A additional tax, the
benefit will be delayed and will begin being provided (together, if applicable, with an
adjustment to compensate Executive for the delay) on the earlier of the first day
following the six (6) month anniversary of Executive’s date of termination or
Executive’s death.




     (d) Any payment or benefit due upon a termination of Executive’s employment that
represents a ‘deferral of compensation’ within the meaning of Section 409A shall be
paid or provided to Executive only upon a ‘separation from service’ as defined in
Treas. Reg. § 1.409A-1(h). Each payment made under Section 8 of this Agreement shall
be deemed to be a separate payment for purposes of Section 409A. Amounts payable under
Section 8 of this Agreement shall be deemed not to be a ‘deferral of compensation’
subject to Section 409A to the extent provided in the exceptions in Treasury Regulation
§§ 1.409A-1(b)(4) (‘short-term deferrals’) and (b)(9) (‘separation pay plans,’
including the exception under subparagraph (iii)) and other applicable provisions of
Treasury Regulation § 1.409A-1 through A-6.




     (e) Notwithstanding anything to the contrary in this Agreement or elsewhere, any
payment or benefit under this Agreement or otherwise that is exempt from Section 409A
pursuant to Treasury Regulation § 1.409A-1(b)(9)(v)(A) or (C) (relating to certain
reimbursements and in-kind benefits) shall be paid or provided to Executive only to the
extent that the expenses are not incurred, or the benefits are not provided, beyond the
last day of the second calendar year following the calendar year in which Executive’s
‘separation from service’ occurs; and provided further that such expenses are
reimbursed no later than the last day of the third calendar year following the calendar
year in which Executive’s ‘separation from service’ occurs.  To the extent any expense
reimbursement or the provision of any in-kind benefit is determined to be subject to
Section 409A (and not exempt pursuant to the prior sentence or otherwise), the amount
of any such expenses eligible for reimbursement, or the provision of any in-kind
benefit, in one calendar year shall not affect the expenses eligible for reimbursement
in any other calendar year (except for any life-time or other aggregate limitation
applicable to medical expenses), in no event shall any expenses be reimbursed after the
last day of the calendar year following the calendar year in which Executive incurred
such expenses, and in no event shall any right to reimbursement or the provision of any
in-kind benefit be subject to liquidation or exchange for another benefit.”



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Section 7. Effectiveness of Amendment. This Amendment shall become effective on the date
hereof.



Section 8. Definitions. Capitalized terms that are not defined in this Amendment shall have
the meanings ascribed thereto in the Employment Agreement.



Section 9. Other Provisions Unaffected. Except as modified by this Amendment, the existing
provisions of the Employment Agreement shall remain in full force and effect.




	 	 	 	 	 
	 	PAYLESS SHOESOURCE, INC.

 	 
	 	By:  	/s/ Betty J. Click
 	 
	 	Name:  Betty J. Click 	 
	 	Its:              Senior Vice President- Human Resources 	 
	 
	 	EXECUTIVE

 	 
	 	By:  	/s/ LuAnn Via
 	 
	 	Name:  LuAnn Via 	 
	 	Title:    President and Chief Executive Officer 	 
	 



 

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WAIVER AND RELEASE




     THIS WAIVER AND RELEASE (this “Waiver and Release”) is entered into by and between Collective
Brands, Inc., a Delaware corporation (the “Company”) and
                     (the “Executive”) pursuant to that certain
Employment Agreement executed by and between the Company and the Executive on the
                     day of
                    , as
amended from time to time (the “Employment Agreement”). The Company and the Executive hereby agree
knowingly and voluntarily as follows:



          1. In consideration of the payments and benefits pursuant to the Employment Agreement (the
“Benefits”) the Executive agrees that the Benefits constitute consideration for this agreement to
which the Executive would not otherwise be entitled and are in lieu of any rights or claims that
the Executive may have with respect to separation or severance benefits, or any other form of
remuneration from the Company or any of its affiliates, and in consideration thereof, after the
opportunity to consult legal counsel, the Executive hereby for himself, and his heirs, agents,
executors, successors, assigns and administrators (collectively, “Related Parties”), forever
releases, remises, and discharges, in all their capacities, the Company and all of its affiliates
or subsidiaries, and any of their present or former directors, employees, fiduciaries,
representatives, officers and agents, successors and assigns (collectively, the “Releasees”)
individually and in their official capacities, of and from all covenants, obligations, liabilities
and agreements, and forever waives all claims, rights and causes of action whatsoever, in law or in
equity, whether known or unknown, asserted or unasserted, suspected or unsuspected, that the
Executive or any Related Parties ever had, may have in the future or have now in connection with or
arising from the Executive’s employment relationship with the Company or termination of the
Executive’s employment relationship with the Company; including, without limitation, any claims,
rights and causes of action under United States federal, state or local law, regulation or
decision, and the national or local law (statutory or decisional) of any foreign country,
including, without limitation, those under the Age Discrimination in Employment Act, as amended
29 U.S.C. §§621 et. seq., the Older Workers Benefit Protection Act, 29 U.S.C. §626
(f)(1), Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Americans with
Disabilities Act, 42 U.S.C. §§12101-12213, the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”), the Family and Medical Leave Act of 1993, the Fair



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Labor Standards Act, and any other similar or related law, regulation or decision relating to
or dealing with discrimination including, without limitation, any claims, rights or causes of
action for punitive damages, attorney’s fees, expenses and costs of litigation. Notwithstanding
the foregoing, the Executive and Related Parties do not release or waive any right or claim (i) the
Executive and Related Parties may have to obtain post-employment payments and benefits, if any, and
exercise any rights pursuant to the Employment Agreement or award thereunder (including, but not
limited to, paragraph[s] ______ thereof; (ii) to obtain post-employment payments and benefits and exercise
any rights under any plan or agreement referred to in the Employment Agreement or award thereunder
(iii) under ERISA to obtain post-employment payments and benefits under any employee benefit plan
(as defined in ERISA); (iv) for indemnification and advancement of fees and expenses under any
agreement with or policy of the Company or its affiliates relating to indemnification and
advancement of fees and expenses of directors or officers or under any provision of the Company’s
articles or by-laws relating to indemnification of directors or officers; (v) under any policy of
directors’ or officers’ liability insurance; (vi) that arises against the Company after the date of
this Waiver and Release; and (vii) to obtain contribution as permitted by law in the event of entry
of judgment against the Executive and the Company as a result of any act or failure to act for
which the Executive and the Company are jointly liable.




          2. The Executive represents that he has not filed, and will not hereafter file, any claim
against the Company relating to his employment and/or cessation of employment with the Company, or
otherwise involving facts that occurred on or prior to the date that Executive has signed this
Waiver and Release except as permitted under paragraph 1 hereof.




          3. The Executive understands and agrees that if Executive commences, continues, joins in, or
in any other manner attempts to assert any claim released herein against the Company, or otherwise
materially violates the terms of this Waiver and Release, the Executive will cease to have any
further rights to the Benefits from the Company referred to in the first paragraph of this Waiver
and Release.




          4. In consideration for the Executive’s release and waiver of claims herein and other good and
valuable consideration, the Company, on behalf of itself and the Releasees, forever releases,
remises and discharges, in all their capacities, the Executive and



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the Related Parties, individually and in their official capacities, of and from all covenants,
obligations, liabilities and agreements, and forever waives all claims, rights and causes of action
whatsoever, in law or in equity, whether known or unknown, asserted or unasserted, suspected or
unsuspected, that the Company or any of the Releasees ever had, may have in the future or have now
in connection with or arising from the Executive’s employment relationship with the Company or
termination of the Executive’s employment relationship with the Company; including, without
limitation, any claims, rights and causes of action under United States federal, state or local
law, regulation or decision, and the national or local law (statutory or decisional) of any foreign
country. Notwithstanding the foregoing, the Company and the Releasees do not release or waive (i)
any right or claim that arises against the Executive after the date of this Waiver and Release,
(ii) any claim against the Executive based on intentional misconduct, fraud, misappropriation or
gross neglect or (iii) any right the Company and the Releasees may have to obtain contribution as
permitted by law in the event of entry of judgment against the Executive and the Company as a
result of any act or failure to act for which the Executive and the Company are jointly liable.




          5. The Executive understands and agrees that the payments by the Company to the Executive of
any Benefits and the signing of this Waiver and Release by the Executive do not in any way indicate
that the Executive has any viable claims against the Company or that the Company admits any
liability to the Executive whatsoever.




          6. The Executive affirms that, prior to the execution of this Waiver and Release, the
Executive was advised by an attorney of the Executive’s choice concerning the terms and conditions
set forth herein, and that the Executive was given up to twenty-one (21) days to consider
(notwithstanding the time lapsed, if any, during such twenty-one day period to review and revise)
this Waiver and Release and its consequences. The Executive has seven (7) days following the
Executive’s signing of this Waiver and Release to revoke and cancel the terms and conditions
contained herein, and the terms and conditions of this Waiver and Release shall not become
effective or enforceable until such revocation period has expired.




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IN WITNESS WHEREOF, the parties hereto
have executed this Waiver and Release this ______ day of ______, ______.




	 	 	 	 	 
	 	EXECUTIVE:

 	 
	 	By:  	 	 
	 	 	 	 
	 	 	 	 
	 
	 	COMPANY:


COLLECTIVE BRANDS, INC.

 	 
	 	By:  	 	 
	 	 	 	 
	 	 	 	 
	 




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