Exhibit 3.
AGREEMENT, made and entered into as of the 1st day of February, 1997,
between BURLINGTON INDUSTRIES, INC., a Delaware corporation (hereinafter
sometimes referred to as the "Corporation"), party of the first part, and Xxxxxx
X. Xxxxxxxxx, III (hereinafter referred to as "Employee"), party of the second
part,
W I T N E S S E T H :
WHEREAS, the Corporation and Employee desire to enter into an Employment
Agreement effective February 1, 1997, this Agreement to supersede in its
entirety the present employment agreement between the parties;
NOW, THEREFORE, in consideration of the mutual agreements hereinafter
contained, the Corporation and Employee hereby agree as follows:
l. The Corporation agrees to employ Employee, and Employee agrees to
serve the Corporation upon the terms hereinafter set forth.
2. The employment of Employee hereunder shall commence February 1, 1997
and continue until January 31, 2000, unless earlier terminated under the
provisions of Paragraphs 6 and 7 of this Agreement.
3. Employee agrees to serve the Corporation faithfully and to the best
of his ability under the direction of the Board of Directors of the Corporation,
devoting his entire time, energy and skill during regular business hours
performing the duties assigned by the Board.
4. The Corporation agrees to pay to Employee during the period of the
term hereof salary for his services at the rate (the "Annual Rate") of Five
Hundred Forty Thousand Dollars ($540,000) per annum, payable in equal monthly or
other more frequent installments in accordance with the general practice of the
Corporation for salaried senior employees.
5. The Corporation may from time to time pay additional incentive
compensation to certain executives when and if authorized by the Board of
Directors or the appropriate Committee of the Board of Directors of the
Corporation. Employee is deemed to be a valuable executive of the Corporation
and will be considered for payment of such incentive compensation in all years
that the Board determines that such compensation should be paid to senior and
key employees generally. It is expressly understood that the amount of any
additional compensation is entirely in the discretion of the Corporation, and
nothing herein shall be construed as a promise or obligation to pay any
additional compensation to Employee whatsoever. If sums are paid to Employee as
additional compensation in any year, such payment shall not create an obligation
to pay additional compensation to Employee in any past or succeeding year. No
payments to Employee of additional compensation, if any, shall reduce or be
applied against the salary to be paid to Employee pursuant to Paragraph 4
hereof.
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6. If, during the term of this Agreement, Employee shall become
physically or mentally incapable of fully performing services required of him in
accordance with his obligations under Paragraph 3 of this Agreement, and such
incapacity is, or may reasonably be expected to exist, for more than two months
in the aggregate during any period of twelve consecutive months, as shall be
determined by a physician mutually agreed upon by the Corporation and Employee
(or Employee's legal representative if Employee is incapable of making such
determination), which determination shall be final and conclusive, the
Corporation may, upon notice to Employee, terminate this Agreement and his
employment hereunder, and upon such termination, Employee shall be entitled to
receive (i) cash compensation in the same amount and for the same period of time
as required under Paragraph 7(b) below and (ii) shall receive benefits as
provided under Paragraph 7(e) below. Employee agrees to accept such payment in
full discharge and release of the Corporation, its subsidiaries and their
management, of and from any and all further obligations and liabilities to him
under Paragraph 4 hereof (including any liability for payments under the
Corporation-funded disability insurance program).
7. (a) The Corporation may in its sole discretion at any time terminate
Employee's employment under this Agreement, whether for cause or without cause.
(b) In the event of (1) a voluntary termination of employment by
Employee for "good reason," (2) an involuntary termination of employment of
Employee without cause or (3) the sale of a subsidiary or a division (a
"Business") of the Corporation that employs Employee or in connection with which
he is employed, in which he is not offered reasonably comparable employment in
the Business or with the Corporation (or any of their respective affiliates)
following such sale, Employee shall receive, as soon as practicable following
such termination: (i) salary accrued through the date of termination at the
Annual Rate and (ii) a lump sum payment in cash equal to the present value of
the salary that would have been payable under Paragraph 4 above during the
Remainder of the Term of this Agreement (as defined below) plus the present
value of an amount (the "Bonus Equivalent") equal to the number of years in the
Remainder of the Term of this Agreement times the amount obtained by dividing
(x) the sum of the incentive compensation received by Employee under the
Company's annual cash incentive plan with respect to each of the last three full
fiscal years prior to the date of termination by (y) three. For purposes of this
Paragraph 7, (i) all present value calculations shall be determined using the
short term applicable federal rate in effect at the time of computation as
determined by the Internal Revenue Service for purposes of Section 1274(d) of
the Internal Revenue Code, and for the purposes of making such calculation, the
date of payment of each year's Bonus Equivalent (or a portion thereof) shall be
the last day of the year with respect to which such Bonus Equivalent would have
been paid; (ii) "Remainder of the Term of this Agreement" shall mean (a) two
years, if such termination occurs on or before January 31, 1998, or (b) one
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year, if such termination occurs after January 31, 1998; and (iii) "good reason"
shall mean a material breach of this Agreement involving the Corporation's
failure to pay compensation due under the terms of this Agreement or a failure
to be employed as a senior management employee of the Corporation.
(c) In the event of an involuntary termination for cause,
Employee shall be entitled to payments under the Severance Policy so long as the
conduct giving rise to such termination was not, in the Corporation's sole
judgment, willful.
(d) In the event that Employee's employment is terminated by the
Corporation or the Employee for any reason other than those set forth in
subparagraphs 7(b) and 7(c) or Paragraph 6 above, the Corporation shall have no
further obligation to Employee hereunder or under the Severance Policy.
(e) In the event Employee is terminated under the circumstances
described in subparagraph 7(b) above, either (i) Employee shall continue, to the
extent permitted by applicable law, as a participating member or beneficiary in
all of the benefit and welfare plans of the Corporation in which Employee
participated immediately prior to the date of termination or (ii) the
Corporation shall fund substantially equivalent benefits to the extent
participation in such plans is not permissible, and Employee shall be guaranteed
service credit in such plans (including, without limitation, for vesting
purposes of the Supplemental Executive Retirement Plan), for a period equal to
the then remaining term of this Agreement or until Employee commences other
employment and obtains coverage under other plans on a substantially similar
basis to those of the Corporation. In all other respects, Employee's rights
under all of the benefit plans of the Corporation, other than the Severance
Policy, shall be governed by the terms of such plans and not by the provisions
of this Agreement, except as provided in subparagraph 7(b) and except for the
provisions of this subparagraph 7(e) providing for continued participation and
service credit under such plans.
(f) Notwithstanding any other provisions of this Agreement,
Employee's obligations under Paragraphs 8 and 9 of this Agreement shall survive
the termination or expiration of this Agreement.
8. Employee expressly agrees, as further consideration hereof and as a
condition to the performance by the Corporation and its subsidiary companies of
their obligations hereunder, that while employed by the Corporation or its
subsidiary companies and during a period of six months following termination of
his employment, he will not directly or indirectly render advisory services to
or become employed by or participate or engage in any business materially
competitive with any of the businesses of the Corporation and its subsidiary
companies (Employee hereby acknowledging that he has had access in his executive
capacity to material information about all of the Corporation's businesses)
without first obtaining the written consent of the Corporation.
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9. Employee agrees that, both during and after his employment hereunder, he
will not disclose to any person unless authorized to do so by the Corporation,
any of the Corporation's trade secrets or other information which is
confidential or secret. Trade secrets or confidential information shall mean
information which has not been made available by the Corporation to the public,
including but not limited to business plans, product or market development
studies, plans or surveys; designs and patterns; inventions, secret processes
and developments; any cost data, including labor costs, material costs, and any
data that is a factor in costs; price, source or utilization data on raw
materials, fibers, machinery, equipment and other manufacturing supplies;
technical improvements, designs, procedures and methods developed by the
Corporation; any data pertaining to sales volume by location or by product
category; customer lists; production methods other than those licensed by
outside companies; compensation practices; and profitability, margins, asset
values, or other information relating to financial statements.
Employee acknowledges that the disclosure of the Corporation's
trade secrets or confidential information to unauthorized persons would
constitute a clear threat to the business of the Corporation, and that the
failure of the Employee to abide by the terms of Paragraphs 8 and 9 will entitle
the Corporation to exercise any or all remedies available to it in law or
equity, including without limitation, an injunction prohibiting a breach of
these provisions.
10. Any notice to be given by Employee hereunder shall be sent to the
Corporation at its offices, 0000 Xxxx Xxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxx
Xxxxxxxx 000x0, and any notice from the Corporation to Employee shall be sent to
Employee at the address set forth under his signature below. Either party may
change the address to which notices are to be sent by notifying the other in
writing of such changes in accordance with the terms hereof.
IN WITNESS WHEREOF, Burlington Industries, Inc. has caused this
Agreement to be executed in its corporate name by its duly authorized corporate
representative thereunto duly authorized, and Xxxxxx X. Xxxxxxxxx, III has
hereunto set his hand and seal, as of the day and year first above written.
BURLINGTON INDUSTRIES, INC.
By_________________________
Xxxxx X. Xxxxxxxxx
Chairman of the Board
___________________________(L.S.)
Xxxxxx X. Xxxxxxxxx, III
