Sears Holdings Employment Compensation Letter Agreement with William R. Harker (March 17, 2010)
This letter agreement between Sears Holdings and William R. Harker outlines his compensation as Senior Vice President, General Counsel, and Corporate Secretary. Effective retroactively to January 31, 2010, Harker's annual base salary is set at $700,000, with eligibility for an annual incentive of 90% of his base salary, prorated for the fiscal year. He also receives a grant of 4,950 restricted shares valued at $500,000, vesting after three years. Payment of incentives requires active employment at the time of payment. Harker must sign and return the letter to accept the terms.
Exhibit 10.39
| SEARS HOLDINGS | ||
| J. DAVID WORKS | ||
| Senior Vice President, Talent and Human Capital Services | ||
| March 17, 2010 |
Mr. William R. Harker
Dear Bill,
I am pleased to tell you that the Compensation Committee of Sears Holdings Board of Directors has approved the following compensation package for you as you continue in the role of Senior Vice President, General Counsel and Corporate Secretary. Your new compensation package was approved retroactive to January 31, 2010, the first day of SHC’s 2010 fiscal year.
The key elements of your new compensation package are as follows:
| • | Annual base salary at a rate of $700,000. |
| • | Participation in the Sears Holdings Corporation Annual Incentive Plan. Your annual incentive opportunity will increase to ninety percent (90%) of your base salary. Your incentive under the 2010 Annual Incentive Plan (“2010 AIP”) will be prorated based on the amount of time at each compensation level (base salary and annual incentive target) through January 29, 2011, the last day of SHC’s 2010 fiscal year. Any annual incentive payable with respect to a fiscal year will be paid by April 15 of the following fiscal year, provided that you are actively employed at the payment date. |
The table below summarizes the changes in your compensation
| Title | Base Salary | Target Incentive | Total Target Cash | |||||||||||
| Current | SVP, General Counsel and Corporate Secretary | $ | 500,000 | 75 | % | $ | 875,000 | |||||||
| New | SVP, General Counsel and Corporate Secretary | $ | 700,000 | 90 | % | $ | 1,330,000 | |||||||
| Increase | 40.0 | % | 52.0 | % | ||||||||||
In addition to the above, you also received a grant of restricted stock valued at $500,000 under the Sears Holdings Corporation 2006 Stock Plan. The number of restricted shares granted (4,950) was determined using the market closing price ($101.01 per share) of Sears Holdings shares on March 9, 2010, the grant date. The restricted shares granted will be scheduled to vest in full on the third anniversary of the grant date, subject to the restrictions set forth under the 2006 Stock Plan and the Restricted Stock Award Agreement.
If you need additional information or clarification, please call. Please sign below and return this letter.
| Sincerely, |
| /s/ J. David Works |
| J. David Works |
| Accepted: |
| /s/ William R. Harker | 4/13/10 | |||
| William R. Harker | Date | |||
