Document:

exv10w8

 

Exhibit 10.8

SEPARATION AGREEMENT AND GENERAL RELEASE

          THIS SEPARATION AGREEMENT AND GENERAL RELEASE
(“Agreement”) is made and entered into on December ___, 2007, by and between Michele A. Bergerac
(hereinafter “Bergerac”), a Missouri resident, and Bakers Footwear Group, Inc. (hereinafter the
“Company”) (collectively, the “Parties”). For and in consideration of the following promises, the
parties agree to the following:

RECITALS

          WHEREAS, Bergerac served as President of the Company and as a Director on the Company’s Board
of Directors until September 15, 2007 (“Separation Date”); and

          WHEREAS, Bergerac entered into a three-year employment agreement (the “Employment Agreement”)
with the Company, commencing on April 1, 2002, whose terms provided for automatic renewal of the
Employment Agreement’s three-year term unless the Company provided Bergerac with written notice of
its decision not to renew the Employment Agreement at least one hundred eighty (180) days prior to
the termination of a three-year term under the Employment Agreement; and

          WHEREAS, Bergerac agrees that her employment with the Company terminated at the end of the day
on the Separation Date, meaning that, as of September 16, 2007, Bergerac was and is no longer
employed by the Company in any capacity, and no longer serves as a Director of the Company; and,

          WHEREAS, the Parties desire to resolve any and all issues between them, actual or potential;
and

          WHEREAS, the Parties desire to enter into a full and final settlement of all matters between
the Parties, including, but not limited to, any issues which might arise out of Bergerac’ s
separation from the Company.

          NOW THEREFORE, for and in consideration of the releases, covenants and undertakings
hereinafter set forth, and for other good and valuable consideration, which each party hereby
acknowledges, it is agreed as follows:

     1. Payments and Benefits. The Company will make the payments and provide the benefits
described below in consideration and in exchange for Bergerac’s promises, agreements, releases, and
obligations set out below, so long as Bergerac submits this Agreement properly executed to the
Company on or before the close of business December 24, 2007, does not revoke this Agreement under
Paragraph 29, and adheres to the promises and agreements set out in the balance of this Agreement.
Bergerac is not, following the Separation Date, eligible for participation in any bonus or equity
programs or any other benefits except as outlined in this Agreement, following the Separation Date.

          (A) Payments. Initial Payments: The Company will pay Bergerac, without regard to
whether she is employed by a third party, twenty-six (26) installments (“Initial Payments”), in
regular two- week intervals consistent with the Company’s regular pay cycles,

 

 

each of which will be in an amount equal to her prior base salary payments of Thirteen Thousand,
Four Hundred Sixty-One Dollars and Fifty-Four Cents ($13,461.54), less withholdings, with the first
installment having been paid on November 6, 2007, and resulting in total payments, before
withholdings, of Three Hundred Fifty Thousand Dollars and Four Cents ($350,000.04).

          Additional Payments: If, however, Bergerac fails to accept a position of employment
prior to the end of the Initial Payments, the Company will pay Bergerac up to an additional
thirteen (13) installments (“Additional Payments”), in regular two-week intervals consistent with
the Company’s regular pay cycles, in the same bi-weekly amount, less withholdings, resulting in
total potential additional payments, before withholdings, of One Hundred Seventy-Five Thousand
Dollars ($175,000.00). Notwithstanding the foregoing, if Bergerac accepts a position of employment
prior to the thirteenth and final Additional Payment, such Additional Payments shall immediately
cease.

          Bergerac agrees to notify the Company in writing if and when she accepts a position of
employment at any time during the periods described above.

          (B) Outplacement Benefits. The Company will pay and arrange for the
services of an outplacement firm, which the Company will choose based on the Company’s
reasonable discretion, to be provided for Bergerac for 90 days following January 8, 2008.

          (C) Unused Vacation Time. From the Separation Date through October 23,
2007, in regular two-week intervals consistent with the Company’s regular pay cycles, the
Company continued to issue to Bergerac payments of Thirteen Thousand, Four Hundred Sixty-
One Dollars and Fifty-Three Cents ($13,461.53), less withholdings, which the parties agree
compensated Bergerac for work performed prior to her Separation Date, and for unused vacation
time preceding the Separation Date. Payments under this Subparagraph took place on
September 25,2007, October 9, 2007, and October 23, 2007.

          (D) WGSN Services Newsletter Subscription. If and to the extent the
Company maintains its own subscription to the WGSN Services Newsletter and only if the
Company is permitted to do so under its existing license, the Company will continue to provide
access for Bergerac’s subscription to the WGSN Services Newsletter during the Initial Payments
and Additional Payments. The Company will not, however, provide Bergerac with access to the
WGSN Services Newsletter if doing so requires the Company to obtain a separate license for
Bergerac’s access, or following such time as Bergerac accepts a position of employment.

          (E) Car Allowance. The Company will pay Bergerac a monthly car allowance
equivalent to the monthly car allowance she received from the Company at the time of her
Separation Date, beginning on the Separation Date and ending on October 31, 2008.

          (F) Health Insurance Continuation. Pursuant to the provisions of the Internal
Revenue Code of 1986, as amended, and the Employee Retirement Income Security Act of 1974,
as amended, commonly referred to as “COBRA,” the Company provided the required COBRA

notification within fourteen (14) days of the Separation Date, and the parties acknowledge
that the COBRA benefit entitlement period of eighteen (18) months commenced to run effective on

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September 16, 2007.
Bergerac and any of her eligible dependents, as applicable, may elect COBRA
coverage under the provisions of COBRA as described in Bergerac’s required COBRA notification.
Should Bergerac or any of her eligible dependents elect COBRA coverage, the Company will pay for
the full cost of premiums associated with any such election throughout Bergerac’s period of
eligibility for COBRA coverage, unless and until Bergerac accepts a position of employment within
such period.

          (G) Acknowledgment of Consideration.  Bergerac acknowledges and agrees the payments
referenced in Paragraph 1 and Subparagraphs 1(A), 1(B), 1(C), 1(D), 1(E), and 1(F) of this
Agreement are valuable consideration to her and that, in some respects, she would not otherwise be
entitled to such consideration absent her execution of this Agreement and the promises set forth
herein.

     2. Acknowledgment of Continued Indemnity.  The Company acknowledges that the
execution of this Agreement neither enlarges nor diminishes the indemnity to which Bergerac is
entitled as a former officer and director of the Company under the current the Restated Bylaws
of Bakers Footwear Group, Inc., as amended, revised or restated from time to time.

     3. Forfeiture
of Rights and Entitlements under Employment Agreement.  Bergerac
agrees that by executing this Agreement, she forfeits all rights and entitlements to payments
of any kind provided by the Employment Agreement; including but not limited to severance
payments, “Trigger Payments,” “Paragraph 9 Payments,” payments to her estate upon her death
during the term of the Employment Agreement, and salary, benefits, and other compensation for
her employment; and to any other entitlements, statuses, titles, or benefits of any
kind—potential or realized—granted to her by the Employment Agreement.

     4. Bonus Plan.  Without limiting the generality of Paragraph 3, Bergerac agrees that
by executing this Agreement, she forfeits all rights and entitlements to payments of any kind
provided by the Company’s Bonus Plan for 2007. Such Plan provided that Bergerac would have
received a bonus for the bonus period covering the fiscal months of February 2007 through
January 2008 if the Company had achieved certain profit levels. Bergerac acknowledges that she
has no further claim or right to, and releases the Company from any claim that she is entitled
to, such a bonus. Furthermore, the Bonus Plan for 2007 provided that Bergerac would have
received a bonus equal to 12.5% of her cumulative salary if she had attained her performance
objectives and met certain criteria. Bergerac acknowledges that she has no further claim or
right to, and releases the Company from any claim that she is entitled to, such a bonus. Bergerac
forfeits any right or entitlement to any bonus payment or potential bonus payment of any kind
from the Company.

     5. Stock Options.  Without limiting the generality of Paragraph 3, Bergerac agrees
that by executing this Agreement, she forfeits any and all rights to exercise any stock
options issued originally under the Bakers Footwear Group, Inc. 2003 Stock Option Plan or any other
stock option plan granted to her by the Company since the Company became a publicly-traded
entity.

     6. 2005 Performance Incentive Plan.  Bergerac agrees and acknowledges that she is
not and will never be entitled to any payment under the 2005 Performance Incentive Plan

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because her Separation Date occurred prior to the end of the earliest of the three-year
performance periods contemplated by the 2005 Performance Incentive Plan.

     7. Vesting in Retirement Plans.  As of the Separation Date, Bergerac was fully
vested in the Company’s 401 (k) plan.

     8. Company’s Release under the Employment Agreement.  In exchange for
Bergerac’s general releases, covenants, acknowledgments, warranties, and promises set forth in
this Agreement, including but not limited to the obligations Bergerac accepts and promises she
makes in Paragraphs 15 and 16 below, the Company releases Bergerac from any and all
obligations imposed on her by Section 13(a) of her Employment Agreement, titled “Non-
Competition.” This release is effective and fully binding as of the Offer Date, as defined in
this Agreement.

     9. Mutual Release of Claims.  Bergerac, for and on behalf of Bergerac and Bergerac’s
heirs, beneficiaries, executors, administrators, successors, assigns, and anyone claiming
through or under any of the foregoing, hereby agrees to, and does, remise, release and forever discharge
the Company and its current and former agents, officers, employees, directors, divisions, parents,
subsidiaries, affiliates, representatives, attorneys, successors, and assigns (hereinafter,
collectively, the “Company Releasees”) from any and all matters, claims, demands, damages, causes of action,
debts, liabilities, controversies, judgments and suits of every kind and nature whatsoever,
foreseen or unforeseen, known or unknown, which have arisen or could arise between Bergerac
and the Company Releasees from matters, actions, or inactions which occurred prior to or on
the Offer Date (as defined in this Agreement), including but not limited to all such claims and
matters arising from or in connection with Bergerac’s employment with the Company, her separation from
the Company, Bergerac’s Employment Agreement, and the offer, negotiation, and acceptance of
this Agreement. Bergerac understands that the provisions of this Paragraph mean that she
cannot bring a lawsuit against the Company Releasees for any reason, except for the
interpretation, breach, and/or enforcement of the terms of this Agreement.

          The Company hereby agrees to, and does, remise, release and forever discharge Bergerac from
any and all matters, claims, demands, damages, causes of action, debts, liabilities, controversies,
judgments and suits of every kind and nature whatsoever, foreseen or unforeseen, known or unknown,
which have arisen or could arise between Bergerac and the Company from matters, actions, or
inactions which occurred prior to or on the Offer Date, including but not limited to all such
claims and matters arising from or in connection with Bergerac’s employment with the Company, her
separation from the Company, Bergerac’s Employment Agreement, and the offer, negotiation, and
acceptance of this Agreement. The Company understands the provisions of this Paragraph to mean that
the Company cannot bring a lawsuit against Bergerac for any reason, except for the interpretation,
breach, and/or enforcement of the terms of this Agreement.

     10. Mutual Agreement Not to File Suit or Other Claims.  Bergerac, for and on behalf
of Bergerac and Bergerac’s beneficiaries, executors, administrators, successors, assigns, and
anyone claiming through or under any of the foregoing, agrees that they will not file or
otherwise submit any charge, claim, complaint, or action to any agency, court, organization, or judicial
forum (nor will Bergerac permit any person, group of persons, or organization to take such

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action on Bergerac’s behalf) against the Company Releasees arising out of any actions or
non-actions on the part of the Company Releasees arising before or on the Offer Date. If any person
or entity should bring such a charge, claim, complaint, or action on Bergerac’s behalf, Bergerac,
to the full extent permitted under applicable law, hereby waives and forfeits any right to recovery
under said claim and will exercise every good faith effort (but will not be obliged to incur any
expense) to have such claim dismissed. The provisions of this Paragraph and Paragraph 11, below,
shall not be construed to prevent Bergerac from filing a charge with the Equal Employment
Opportunity Commission (“EEOC”), only to the extent she is permitted to do so by law,
notwithstanding the provisions of this Agreement to the contrary. However, Bergerac expressly
waives and disclaims any right to compensation or other benefit which may inure to her as a result
of any such charge and hereby expressly agrees to provide any such benefit or pay any such
compensation directly to the Company. Bergerac understands that the provisions of this Paragraph
mean that she cannot bring a lawsuit against the Company Releasees for any reason, except for the
interpretation, breach, and/or enforcement of the terms of this Agreement.

          The Company agrees that the Company will not file suit or otherwise submit any other charge,
claim, complaint, or action to any agency, court, organization, or judicial forum (nor will the
Company permit any person, group of persons, or organization over which the Company has legal
control to take such action on the Company’s behalf) against Bergerac arising out of any actions or
non-actions that have occurred on the part of Bergerac. Said claims, complaints, and actions
include, but are not limited to, any claims the Company may have relating to Bergerac’s employment
with the Company and/or the termination of that employment, any breach of an actual or implied
contract of employment between Bergerac and the Company, any conduct occurring during the
negotiation and execution of this Agreement, or any common-law claim (including but not limited to
fraud, negligence, intentional or negligent infliction of emotional distress, or defamation). If
any person or entity should bring such a charge, claim, complaint, or action on the Company’s
behalf, the Company, to the full extent permitted under applicable law, hereby waives and forfeits
any right to recovery under said claim and will exercise every good faith effort (but will not be
obliged to incur any expense) to have such claim dismissed. The Company agrees to pay any such
recovery directly to Bergerac. The Company understands the provisions of this Paragraph to mean
that the Company cannot bring a lawsuit against Bergerac for any reason, except for the
interpretation, breach, and/or enforcement of the terms of this Agreement.

     
11. Claims Covered by Agreement. The charges, claims, complaints, matters, demands,
damages, and causes of action referenced in Paragraphs 9 and 10, above, include, but are not
limited to, (i) any breach of an actual or implied contract of employment between Bergerac and the
Company Releasees, (ii) any claim of unjust, wrongful, or tortious discharge (including any claim
of fraud, negligence, retaliation for whistleblowing, or intentional infliction of emotional
distress), (iii) any claim of defamation or other common-law action, (iv) any claim related to the
issuance or non-issuance of stock, or (v) any claims of violations arising under whistleblower
employee protection provisions of the Sarbanes-Oxley Act of 2002, 18 U.S.C. § 1514A, the Civil
Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq., the Civil Rights Act of 1866, 42 U.S.C.
§ 1981, the Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq., (including but not
limited to the Older Worker’s Benefit Protection Act), the Americans with Disabilities Act of
1990, 42 U.S.C; § 12101 et seq., the Fair Labor Standards Act of 1938,

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as
amended, 29 U.S.C. § 201 et  seq., the Rehabilitation Act of 1973, as
 amended, 29 U.S.C. § 701 et  seq., the Family and Medical Leave Act, 29 U.S.C. § 2601, the Employee Retirement Income Security
Act, 29 U.S.C. § 1001, et seq. or the Missouri
Human Rights Act, R.S. Mo. § 213.010, et
seq., the Missouri Service Letter Statute, R.S. Mo. § 290.140, the Missouri Employment Security Act,
R.S. Mo. § 288.010, et seq., retaliation for exercise of rights Under the Missouri Worker’s
Compensation Act, R.S. Mo.§ 287.010 et  seq.; the Missouri Aids Act, R.S.Mo. § 191.6665,
et
seq., as amended; the Missouri Equal Pay Law, R.S.Mo. § 290.400-290.460 et seq., as amended; the
Missouri Handicap Discrimination Statute, R.S.Mo. § 209.150, 290.160, 290.162, and 209.180 et seq.,
as amended; the Missouri Genetic Testing Information Bias Law, R.S.Mo. §375.1300, 375.1303,
375.1306 and 375.1309 et seq., as amended; the Missouri Smokers
Rights Law, R.S.Mo. § 290.145 et seq., as amended, or any other federal, state, or local statutes or ordinances or common
laws, or any claims for pay, vacation pay, business expenses, insurance, or welfare benefits or any
other benefits of employment with the Company Releasees arising from or relating to Bergerac’s
Employment Agreement, from any other agreement with the Company Releasees, or from events occurring
prior to or on the Offer Date other than those payments and benefits specifically provided herein.

     12. Release of Benefit Claims. In exchange for the Company’s promises and
commitments set out herein, Bergerac further releases and waives any claim for any type of
compensation or employee benefits with the Company, except to the extent specifically provided
herein.

    
 13. Representations and Warranties Regarding the FMLA, FLSA, and Sarbanes-
Oxley Act. Bergerac represents and warrants that she is not aware of any circumstances
that might entitle Bergerac to a leave of absence under the Family and Medical Leave Act (“FMLA”)
or any fact which might justify a claim against the Company for violation of the FMLA.
Bergerac represents and warrants further that Bergerac has received or will receive under the
terms of this Agreement any and all wages and commissions for work performed and all
overtime compensation and FMLA leave to which Bergerac may have been entitled, and that
Bergerac is not currently aware of any facts or circumstances constituting a violation by the
Company of the FMLA or the Fair Labor Standards Act (“FLSA”). Bergerac represents and
warrants further that she has not received any notice that, nor is she personally aware of any
allegation that either she or the Company has violated any provision of the Sarbanes-Oxley Act
of 2002. Bergerac specifically warrants that she has discussed this issue and all underlying
facts with her attorney prior to making these representations.

     
14. Confidentiality of Agreement. Notwithstanding the Company’s duty to comply
with Securities Exchange Commission (“SEC”) public disclosure requirements, in exchange for
the receipt of the payments set out above, Bergerac agrees that she will not publicize this
Agreement directly, either in specific or as to general content, to either the public
generally, to any employee or agent of the Company, or to any other person or entity, except as Bergerac
might be lawfully compelled to give testimony by court or federal agency process, lawful
deposition, interrogatory, discovery or arbitrator of competent jurisdiction, or to
participate in an EEOC, SEC, or other federal agency investigation, or except as otherwise provided in this
Paragraph 14. Furthermore, the parties do not intend for this Agreement to restrict Bergerac
from engaging in any whistleblower activity protected by federal law; thus, Bergerac’s
publicity of and discussions about the terms of this Agreement, if made in connection with whistleblower

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activity protected by federal law, will not constitute a breach of this Agreement. Bergerac’s
agreement not to publicize the terms of this Agreement requires Bergerac to refrain from
communicating regarding the terms of this Agreement with anyone except Bergerac’s immediate family,
Bergerac’s attorney, accountant, or financial advisor who has a legitimate need to know the terms
of this Agreement in order to render professional advice or services to Bergerac, and Bergerac’s
prospective and future employers (only to the extent provided expressly by the provisions of this
Paragraph 14); otherwise, Bergerac agrees not to publicize any other terms of the Agreement. The
Company recognizes Bergerac may need to disclose the provisions of Paragraphs 8, 14, 15, 16, 18,
and 33 to prospective employers, and to that limited extent, Bergerac may, without violating this
Agreement, disclose the provisions of Paragraphs 8, 14,15, 16, 18, and 33 to prospective employers.
The parties acknowledge the Company has an obligation to disclose this Agreement and its terms to
the Securities and Exchange Commission and as a result thereof, this Agreement and its provisions
will likely be made part of the public record. Bergerac agrees her publication of the terms of this
Agreement first may, taking into consideration the Company’s obligation to disclose this Agreement,
constitute a breach of this Agreement, and that any such breach might, again taking into
consideration the Company’s obligation to disclose this Agreement, be considered a material breach.
If Bergerac’s breach of the provisions of this Paragraph 14 is determined to be a material breach
of this Agreement, such breach will excuse the Company from making any further payments set forth
in Paragraph 1 hereof. This shall not be construed as a limitation,of remedies, and the Company
retains all rights to pursue any and all claims or actions against Bergerac as a result of Bergerac
publicizing the terms of this Agreement in a manner prohibited by this Paragraph.

     
15. Non-Solicitation/Non-Hire. During Bergerac’s employment with the Company, Bergerac had
access to Confidential Information, as defined below in Paragraph 18, and developed certain
relationships and goodwill such that if Bergerac were allowed (among other things) to pursue, or
otherwise take advantage of, her relationships and goodwill with the Company’s employees, Bergerac
would have an unfair advantage based upon such Confidential Information, relationships, and
goodwill developed. Furthermore, Bergerac acknowledges that the Company invests significant
resources, on an ongoing basis, to recruit, hire, train, and retain its Senior Personnel. Bergerac
also agrees the Company has a legitimate, material interest in protecting against the soliciting
and/or hiring of its Senior Personnel based, in whole or in part, on the relationships or goodwill
that Bergerac may have with such Senior Personnel.

          (A) In view of the above, Bergerac agrees that from the Separation Date through and including
September 30, 2008 (the “Covered Period”), Bergerac will not, directly or indirectly (as defined
below):

               (1) solicit or recruit for employment, offer employment to, or hire —
on a temporary, permanent or contract basis, or otherwise — any of the Company’s Senior
Personnel; or

               (2) encourage, entice or persuade, or intentionally attempt to
encourage, entice or persuade, any of the Company’s Senior Personnel to leave his or her
employment with the Company.

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          (B) Breach of this Paragraph 15 will be considered a material breach and will,
among all other available remedies and relief, excuse the Company from any further obligations
to Bergerac under this Agreement, including any remaining payments set forth in Paragraph 1
hereof. This shall not be construed as a limitation of remedies, and the Company retains all
rights to pursue any and all claims or actions against Bergerac as a result of Bergerac
breaching her obligations under this Paragraph 15. In addition, breach of this Paragraph 15 will result
in irreparable harm to the Company and the Company therefore is entitled to temporary,
preliminary and/or permanent injunctive relief to prevent any breach or threatened breach of
this Section 15.

          (C) The Parties agree that the restrictions and conditions contained in this
Paragraph 15 are reasonable, appropriate, and should be fully enforceable in light of (among
other things) the following:

               (1) the Parties’ respective interests, including but not limited to the
Company’s interests in preserving and protecting its Senior Personnel, its goodwill and
relationships with its Senior Personnel, and the stability of its Senior Personnel workforce;

               (2) the Parties’ acknowledgment and agreement that, but for this
Agreement, Bergerac would be subject to a non-compete covenant in Section 13(a) of her
Employment Agreement;

               (3) the Parties’ negotiations and agreements with respect to the terms
of this Agreement;

               (4) the Parties’ acknowledgment that during Bergerac’s employment
with the Company, she had access to confidential, competitively-valuable information, including
such information relating to the Company’s Senior Personnel, including such information as to their
compensation, strengths, weaknesses, levels of performance, and other such confidential information
that could give Bergerac and/or a Covered Employer an unfair competitive advantage in hiring or
soliciting one or more of the Company’s Senior Personnel during the Covered Period;

               (5) the Parties’ acknowledgment and agreement that by virtue of
Bergerac’s employment with the Company, she has developed and enjoys significant
relationships and goodwill with various key Senior Personnel of the Company, and those
relationships and that goodwill could result in Senior Personnel wanting to work with her; and

               (6) the damage and harm to the Company due to any breach of this
Section 15 would be extremely difficult to determine and/or to quantify because of the various
costs and harms, both tangible and intangible, that often result when key employees leave or
consider leaving.

          (D) The term “indirect” as used in this Paragraph 15 shall mean Bergerac
acting through a third party rather than acting on her own.

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     16. Additional Hiring-Related Protection.

          (A) If, during the Covered Period, Bergerac is willing to accept an
employment offer from any Covered Employer, she will ask the Covered Employer to sign the Agreement
attached hereto as Exhibit 1 (the “No-Hire Agreement”). If the Covered New Employer signs the
No-Hire Agreement, Bergerac shall also sign it and shall deliver the document to the Company for
its signature. The Company shall, without undue delay, sign and return the No-Hire Agreement to
Bergerac and the Covered Employer. In the event the Company has not signed and returned the No-Hire
Agreement within ten (10) calendar days of receipt, the Company will be deemed to have signed the
document as of the tenth day following receipt of the No-Hire Agreement.

          (B) If Bergerac is employed during the Covered Period by a Covered
Employer who fails to sign the No-Hire Agreement prior to Bergerac’s employment with the
Covered Employer, she will immediately terminate her employment with such Covered New
Employer and refuse to accept further employment with that Covered Employer upon receiving
notice that the Covered Employer that employs her has directly or indirectly (regardless of
Bergerac’s involvement), during the Covered Period,

               (1) solicited or recruited for employment, offered employment to, or
hired — on a temporary, permanent or contract: basis, or otherwise — any of the Company’s Senior
Personnel (provided, however, that general advertising for employees, such as through newspapers,
trade publications and the like, shall not be prohibited by this Section); or

               (2) encouraged, enticed or persuaded, or intentionally attempted to
encourage, entice or persuade any of the Company’s Senior Personnel to leave his or her
employment with the Company.

          (C) For purposes of this Agreement (including Paragraph 15 hereof),

               (1) the
term “Covered Employer” shall mean Aldo Group Inc.; Steve
Madden, Ltd.; Collective Brands Inc. (including Payless ShoeSource); Genesco Inc.; and/or any
of their respective parents, subsidiaries or Affiliates (as defined in this Agreement) engaged
in the shoe sales industry, and

               (2) the term “Senior Personnel” shall mean any of the Company’s
Home Office Personnel (i.e., any person who is or was a salaried employee of the Company and who
worked at the Company’s headquarters in St. Louis, Missouri) and/or Division Sales Managers who are
or were employees of the Company (a) at the time of solicitation, recruitment, offer of employment,
or hiring, or (b) at anytime during the 90-day period immediately preceding any such solicitation,
recruitment or hiring; and

               (3) the term “Affiliate” shall mean any corporation, partnership,
limited liability company, or any other entity that directly, or indirectly through one or
more intermediaries, controls, or is controlled by, or is under common control with, the specified
Covered Employer.

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          (D) If a Covered Employer encompassed by Paragraph 16(B) engages in
conduct encompassed by Paragraph 16(B) and Bergerac breaches her obligations under this
Paragraph 16 to terminate and to refuse further employment with the Covered Employer, the
Parties agree that:

               (1) if the Company loses as a direct or indirect result of Bergerac’s
Covered Employer engaging in conduct described in Paragraph 16(B) any Senior Personnel
member(s), then Bergerac will pay to the Company an amount equal to double the annual salary
of any Senior Personnel member(s) for each such Senior Personnel member who leaves the
Company, in addition to any additional relief that may be available to the Company,
specifically including but not limited to the Company’s right to cease paying any remaining payments
otherwise due to Bergerac under Paragraph 1;

               (2) if the Company does not lose any Senior Personnel member(s) as a
direct or indirect result of Bergerac’s Covered Employer engaging in conduct described in
Paragraph 16(B), Bergerac shall compensate the Company for all costs, damages and expenses it
incurs in connection with such conduct, in addition to any additional relief that may be
available to the Company, specifically including but not limited to the Company’s right to cease paying
any remaining payments otherwise due to Bergerac under Paragraph 1;

               (3) the damage to the Company due to any breach of Paragraph 16(B)
of this Agreement will be extremely difficult to determine, and the liquidated damages
described in Paragraph 16(D)(1) represents a conservative estimate of the damage the Company is likely
to suffer — based on (among other things) the value of services Senior Personnel provide to the
Company and the costs of replacing Senior Personnel and maintaining morale and loyalty among
Senior Personnel — if Senior Personnel were to leave the Company;

               (4) nothing herein precludes the Company from obtaining injunctive
relief requiring Bergerac to abide by her obligations in Paragraph 16, including the obligation to
terminate her employment and not accept future employment with a particular Covered Employer as set
forth in Paragraph 16(B), and Bergerac consents to the Company obtaining such injunctive relief in
addition to any liquidated damages awarded and/or paid to the Company under this Paragraph 16; and

               (5) any breach of Paragraph 16 will result in irreparable harm to the
Company.

          (E) The Parties agree that the restrictions, conditions, and damage provisions
contained in Paragraph 16 are reasonable, appropriate, and should be fully enforceable in
light of (among other things) the following:

               (1) the Parties’ respective interests, including but not limited to the
Company’s interests in protecting its Senior Personnel and Confidential Information, its goodwill
and relationships with its employees, and in preserving the stability of its Senior Personnel;

               (2) the Parties’ acknowledgment and agreement that, but for this
Agreement, Bergerac would be subject to a non-compete covenant in Section 13(a) of her
Employment Agreement, which contains, in some degree and manner, greater restrictions than

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are contained in this Agreement and which might have prevented Bergerac from engaging in certain
post-employment activities;

               (3) the
Parties’ acknowledgment and agreement that, but for this Agreement, Bergerac’s Employment Agreement would have imposed certain other and different payment
obligations on the Company;

               (4) the Parties’ negotiations and agreements with respect to Bergerac’s post-employment
compensation terms;

               (5) the Parties’ acknowledgment and agreement that during Bergerac’s employment with the
Company, she has had access to Confidential Information, including Confidential Information
relating to Company employees, their compensation, their strengths, weaknesses, and levels of
performance, and other such Confidential Information that would give Bergerac and/or a Covered
Employer an unfair competitive advantage if Bergerac (for example) were to work for a Covered
Employer who hires the Company’s Senior Personnel;

               (6) the Parties’ acknowledgment and agreement that if a Covered Employer were to hire Senior
Personnel, the Company would very likely not be able to determine whether and/or the extent to
which Bergerac may have played a role in such hiring; and

               (7) the Parties’ acknowledgment and agreement that by virtue of Bergerac’s employment with
the Company, she has developed and enjoys significant relationships and goodwill with various key
employees of the Company, and those relationships and that goodwill could very well result in other
Senior Personnel wanting to work with her at a Covered Employer.

     17. Nondisparagement. Bergerac and the Company agree, as set forth below, they
will not, in any way, criticize, denigrate or otherwise disparage the other. Specifically, Bergerac
agrees not to disparage the Company, including but not limited to the Company’s current or former
officers, directors and employees, and Bergerac agrees she will not, at any time, make or solicit
any comments, statements or the like to the media or to others, including their agents or
representatives, that may be considered to be derogatory or detrimental to the good name or
business reputation of the Company. Bergerac further represents and agrees that she has not and
will not engage in any conduct or take any action whatsoever to cause or influence or which
reasonably could be anticipated to cause or influence any person or entity, including but not
limited to, any past, present or prospective employee of, or applicant for employment with the
Company, to initiate litigation, assert any other kind of claim or take any other kind of adverse
action against the Company. Notwithstanding the requirements of this Paragraph, nothing herein
shall prohibit Bergerac from engaging in whistleblower activity protected by federal law.

          Correspondingly, the Company agrees to instruct its employees to refrain from making disparaging
remarks about Bergerac, and the Company agrees to instruct its employees to refrain from making or
soliciting any comments, statements or the like to the media or to others, including their agents
or representatives, that may be considered to be derogatory or detrimental to Bergerac’s good name
and reputation.

11

 

     18. Non-Disclosure of Confidential Information. Bergerac shall not use or disclose,
or provide to others, any Confidential Information. “Confidential Information” shall mean any and
all information of the Company that is not generally known to the public, including but not limited
to such information relating to the Company’s (i) development, research, testing, manufacturing,
marketing and financial activities; (ii) products and services; (iii) costs, sources of supply,
financial performance and strategic plans; (iv) information pertaining to the identity and special
needs of the Company’s customers of the Company, and (v) client lists and information pertaining to
the people and organizations with whom the Company has business relationships and the substance of
those relationships. Confidential Information also includes any information that the Company has
received belonging to customers or others with any understanding, express or implied, that the
information would not be disclosed by the Company. The confidentiality obligation under this
Paragraph shall not apply to information that is generally known or reasonably available to the
public at the time of disclosure or becomes generally known through no wrongful act, directly or
indirectly, on the part of Bergerac. As a further acknowledgment of her responsibilities under this
Paragraph, Bergerac further acknowledges and agrees that:

          (A) all memoranda, notes, records, reports, papers, drawings, designs, computer files in any
media, documents, records, tapes and other media of every kind and description relating to the
business, present or otherwise, of the Company and any copies, in whole or in part, thereof (the
“Documents”), whether or not prepared by Bergerac, shall be the sole and exclusive property of the
Company. Bergerac represents and warrants that that during Bergerac’s employment with the Company,
other than to the extent required by her responsibilities with the Company, Bergerac did not
intentionally disclose any Confidential Information, that she has no knowledge of having
unintentionally disclosed the Company’s Confidential Information, and that she, has surrendered to
the Company all of the Company’s property in Bergerac’s possession or control. In aid of this
representation, the Company has advised Bergerac that it has no knowledge of any such disclosure as
of the Offer Date.

          (B) if Bergerac is requested or becomes legally compelled (by oral questions,
interrogatories, requests for information or documents, deposition, subpoena, civil or federal
agency investigative demand or similar process) to disclose any Confidential Information, Bergerac
shall, where permitted under applicable law, rule or regulation, provide written notice to the
Company promptly after such request so the Company may, at its expense, seek a protective order or
other appropriate remedy, and Bergerac
agrees to reasonably cooperate with the Company in connection with seeking such order or other
remedy. If such protective order or other remedy is not obtained, Bergerac shall furnish only that
portion of the Confidential Information that Bergerac is advised by her counsel is required, and
shall exercise reasonable efforts to obtain assurance that confidential treatment will be accorded
such Confidential Information. In addition, Bergerac may disclose Confidential Information in the
course of inspections, examinations or inquiries by federal or state regulatory agencies and self
regulatory organizations that have requested or required the inspection of records that contain the
Confidential Information provided that Bergerac exercises reasonable efforts to obtain reliable
assurances that confidential treatment will be accorded to such Confidential Information. To the
extent such information is required to be disclosed and is not accorded confidential treatment as
described in the immediately preceding sentence, it shall not constitute “Confidential Information”
under this Agreement. The Company agrees to reimburse Bergerac for any

12

 

reasonable out-of-pocket expenses she incurs in exercising reasonable efforts to obtain reliable
assurances of confidential treatment of the Company’s Confidential Information as required under
this Subparagraph.

     19. Reasonable Scope of Agreement. Bergerac and the Company acknowledge that the
scope of this Agreement, including without limitation, Paragraphs 14, 15, 16, 17, and 18 of the
Agreement, is reasonable in light of its narrow focus and the legitimate interests of Bergerac and
the Company to be protected.

     20. Company’s Breach of this Agreement. If Bergerac contends that the Company is in
breach of its obligations hereunder, including but not limited to its payment obligations to
Bergerac as set forth herein, Bergerac shall provide written notice to the Company, to the
attention of its Chief Executive Officer, specifically identifying the alleged breach and
referencing the pertinent provisions of this Agreement, including this paragraph 20. The Company
shall then have ten (10) days in which to cure such breach. If the Company is given the required
notice and fails to cure the alleged breach within ten (10) days, then Bergerac shall be relieved
of her obligations under this Agreement; provided, however, that Bergerac shall not be relieved of
such obligations if the Company’s alleged breach is the result of the Company’s good faith belief
that Bergerac has breached her obligations under this Agreement such that the Company would be
excused from its obligations under this Agreement, so long as the Company has provided Bergerac
with prior written notice of its belief that Bergerac has breached

     21. No Admission of Wrongdoing. The parties to this Agreement agree that nothing in
this Agreement is an admission by any party hereto of any wrongdoing, either in violation of an
applicable law or otherwise, and that nothing in this Agreement is to be construed as such by any
person.

     22. Knowing and Voluntary Agreement. Bergerac acknowledges further that she
understands this Agreement, the claims she is releasing herein, the promises and agreements she is
making herein, and the effect of her signing this Agreement. Bergerac represents, declares, and
agrees further that she voluntarily accepts the consideration described above in Paragraph 1 for
the purpose of making a full and final compromise, adjustment, and settlement of all claims or
potential claims against the Company from any action or inaction taking place prior to or on the
Separation Date.

     23. Choice of Law. Because of the Company’s and Bergerac’s substantial contacts with
Missouri, the fact that the Company hired Bergerac in Missouri, Bergerac’s primary place of work
for the Company has been located in Missouri, and the parties’ interests in ensuring that disputes
regarding the interpretation, validity, and enforceability of this Agreement are resolved on a
uniform basis, the parties agree that the Agreement shall be interpreted, construed, applied, and
governed by and according to the laws of the State of Missouri, without regard for any conflict of
law
principles.

     24. Modification. Subject to Paragraph 26 of this Agreement, the parties hereto
agree that this Agreement may not be modified, altered, or changed except by a written agreement
signed by the parties hereto.

13

 

     25. Entire Agreement. The parties acknowledge that this constitutes the entire
agreement between them superseding all prior written and oral agreements, regarding Bergerac’s
separation, and there are no other understandings or agreements, written or oral, among them on the
subject of Bergerac’s separation.

     26. Severability. If any provision of this Agreement is deemed by a court of
competent jurisdiction to be unenforceable because it is overbroad or unreasonable, then such
provision shall be modified and, to the maximum extent permitted under applicable law, enforced. If
any provision of this Agreement is held to be invalid and not subject to modification, the
remaining provisions shall remain in full force and effect.

     27. Rule of Construction. The rule of construction to the effect that ambiguities
are to be resolved against the drafting party shall not be employed in interpreting this Agreement.
The parties intend for this Agreement to satisfy the provisions of the Age Discrimination in
Employment Act of 1967, as amended, and the Sarbanes-Oxley Act of 2002, and this Agreement shall
always be construed or limited in conformity with such provisions.

     28. Execution and Effective Date. Separate copies of this document shall constitute
original documents which may be signed separately but which together will constitute one single
agreement. This Agreement will not be binding on any party, however, until, at a minimum, it is
signed by all parties or their representatives. In addition, this Agreement shall become effective
and binding on the eighth day following Bergerac’s execution of this Agreement.

     29. Time for Consideration. Bergerac acknowledges that the Company first gave her a
copy of this Agreement by or before the close of the business day on or before December 3, 2007
(the “Offer Date”), and that, at that time, the Company advised Bergerac that Bergerac could
consider the offer for up to twenty-one (21) days from the Offer Date. This Agreement shall not
become final and binding upon Bergerac until the eighth calendar day following Bergerac’s execution
of this Agreement (the “Effective Date”). During said seven-day period, Bergerac may revoke this
Agreement by giving written notice to Peter Edison, Chairman and Chief Executive Officer, Bakers
Footwear Group, Inc., 2815 Scott Avenue, St. Louis, MO 63103. By executing this Agreement, Bergerac
acknowledges that the Company has advised her that she has up to twenty-one (21) days until the
close of the business day on December 24, 2007, within which to consider this Agreement before
signing the same, and that Bergerac has, in
fact, been given at least twenty-one (21) days within which to consider this Agreement prior to
signing the Agreement. Notwithstanding the opportunity to consider this Agreement for twenty-one
(21) days, Bergerac acknowledges that should she sign this Agreement anytime prior to the
expiration of twenty-one (21) days, that she has nonetheless given full consideration to those
terms and signs of her free volition. The Company shall be deemed to have revoked its offer to
enter into this Agreement if Bergerac shall not have executed this Agreement within twenty-one (21)
days of the Offer Date.

     30. Consultation with an Attorney. By executing this Agreement, Bergerac
acknowledges that, at the time the Company presented this Agreement to her for her consideration,
the Company advised Bergerac to consult with an attorney about this Agreement, its meaning and
effect, prior to executing this Agreement.

14

 

     31. No Reliance. The parties have not relied on any representations, promises, or
agreements of any kind made to them in connection with this Agreement, except for those set forth
in this Agreement.

     32. Capacity to Settle. Each party herein represents and warrants to the other that
each has no legal impediments (including bankruptcies) to fully and completely settle all claims
and to sign this Agreement. Both parties further warrant that each is the sole owner of all the
claims released in this Agreement, and that each has not assigned or transferred any such claim (or
any interest in any such claim) to any other person, and that each will indemnify, defend and hold
each other harmless for any damages costs, fees or expenses which they may incur if these
representations and warranties are incorrect in any respect.

     33. Cooperation by Bergerac. In exchange for the receipt of the payments set out
above, Bergerac agrees to cooperate fully in any manner requested by the Company regarding any and
all pending or future cases, including timely and accurately providing her testimony in cases in
which she was involved in any manner during her tenure of employment with the Company. Bergerac
will not receive any additional pay for any such testimony. Bergerac also agrees that in exchange
for the payments set out above, she will remain on-call with the Company and cooperate fully in any
manner reasonably requested by the Company during the twelve-month period ending on September 15,
2008, with respect to reasonable requests for information by the Company in order to access the
Company’s information, explain information known by Bergerac by virtue of her employment with the
Company, or otherwise assist in transitioning Bergerac’s job responsibilities with the Company and
transitioning the Company’s systems and procedures. The Company acknowledges Bergerac may be
otherwise employed during such period and, therefore, agrees to temper its requests for assistance
such that Bergerac may comply with the provisions of her employment, in which case Bergerac agrees
to make herself generally available on weekends and after regular business hours on weekdays to
comply with the Company’s requests under this Paragraph 33. Bergerac agrees she will not receive
any
additional pay for cooperating with the Company in responding to reasonable requests for
information made by the Company, except .that the Company agrees to pay Bergerac for any reasonable
out-of-pocket expenses she incurs in performing her obligations under this Paragraph.

     34. Return of Property. Bergerac agrees to return all properly belonging to the
Company, including, but not limited to any automobile provided to her by the Company, her laptop
computer, cellular phone, Blackberry device, PDA, pager, the Company identification card, keys,
security cards, credit cards, gas cards, parking pass, documents (including all copies regardless
of media) of any kind provided of shown to Bergerac throughout her employment with the Company, and
any other property of the Company. Bergerac further agrees she has not copied or otherwise
replicated or retained any of the above or like data and things. All property described herein
shall be returned by the Effective Date of this Agreement, as defined in Paragraph 28, above.

     35. Materiality. The parties acknowledge and agree that each Paragraph of this
Agreement constitutes a material term of the Agreement, without which the Company would not enter
into this Agreement.

15

 

     36. Characterization. The parties agree that for purposes of this agreement,
Bergerac’s separation of employment shall be deemed an involuntary termination.

     37. Choice of Forum. All actions for and/or relating to the interpretation, breach,
and/or enforcement of this Agreement shall be brought and litigated exclusively in the Circuit
Court for the County or City of St. Louis, Missouri, or the U.S. District Court for the Eastern
District of Missouri.

          IN WITNESS WHEREOF, the undersigned parties have executed this Separation Agreement and General
Release.

I HAVE READ THIS SEPARATION AGREEMENT AND GENERAL RELEASE AND, UNDERSTANDING ALL OF ITS TERMS, SIGN
IT OF MY FREE WILL.

	 	 	 	 	 
	December 24, 2007

	 	/s/ Michele A. Bergerac	 	 
	 

	 	 

Michele A. Bergerac
	 	 

Subscribed and sworn to before me, a Notary Public, this 24 day of December, 2007.

	 	 	 
	/s/
Timothy D. Lambert
	 	 
	 

NOTARY PUBLIC

	 	 

			
	 	 	 
	 	 	
	My commission
Expires: March 12, 2011
	 

	 	 	 	 	 
	 	THE COMPANY:

 	 
	December 28, 2007 	By:  	/s/ Peter A. Edison
 	 
	 	 	Peter A. Edison, 	 
	 	 	Chief Executive Officer 	 
	 

Subscribed and sworn to before me, a Notary Public, this 28th day of December, 2007.

	 	 	 
	/s/
David M. Klemm
	 	 
	 

NOTARY PUBLIC

	 	 

			
	 	 	 
	 		 
	My Commission
Expires:
	 

16exv10w25

 

Exhibit 10.25

Summary of Base Salaries

For Specified Executive Officers

of Bakers Footwear Group, Inc.

The
following table sets forth the base salaries as of April 18,
2008 for certain of the Company’s
executive officers:

	 	 	 	 	 
	Name and Principal Position (1)	 	Base Salary
	Peter A. Edison
	 	 	$350,000	 
	Chairman of the Board, Chief Executive Officer

and President
	 	 	 	 
	 
	 	 	 	 
	Stanley K. Tusman
	 	 	$265,000	 
	Executive Vice President and

Chief Planning Officer
	 	 	 	 
	 
	 	 	 	 
	Mark D. Ianni
	 	 	$270,000	 
	Executive Vice President and

Chief Merchandising Officer
	 	 	 	 
	 
	 	 	 	 
	Joseph R. Vander Pluym
	 	 	$270,000	 
	Executive Vice President and

Chief Operations Officer
	 	 	 	 

 

(1) Each
of these executive officers is a party to a written employment
agreement with the Company and may be a party to other compensation arrangements with the Company
that have been filed as exhibits to the Company’s Annual Report on Form 10-K or in other filings
with the Securities and Exchange Commission. Bonuses are determined by the Company’s Compensation
Committee on terms generally consistent with the Bakers Footwear Group, Inc. Cash Bonus Plan. The
Company’s executive officers are eligible to participate in the Bakers Footwear Group, Inc. Cash
Bonus Plan, Bakers Footwear Group, Inc. 2003 Stock Option Plan and the Bakers Footwear Group, Inc.
2005 Incentive Compensation Plan, receive matching employer contributions to the Company’s 401(k)
plan, participate in other employee benefit plans and receive other forms of compensation. The
Company also pays premiums on a life insurance policy solely for the benefit of Mr. Tusman.

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