Exhibit 10-F-6
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EMPLOYMENT AGREEMENT
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THE EMPLOYMENT AGREEMENT entered into as of the 8th day of
August, 2002, by and between HARTMARX CORPORATION, a Delaware corporation
("Company"), and XXXXX X. XXXXXXX ("Executive").
WITNESSETH THAT:
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WHEREAS, the Executive is a party to a Severance Letter
Agreement with the Company dated November 27, 2000 (the "Severance
Letter");
WHEREAS, the parties hereto desire to enter into this
Agreement pertaining to the terms of Executive's employment by the Company;
and
WHEREAS, the Company and the Executive intend to enter into a
Severance Agreement ("Severance Agreement"), coincident herewith; and
WHEREAS, upon the execution of this Agreement by the Company
and Executive the terms and conditions of this Agreement shall control and
govern the employment relationship between the Company and Executive.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth below, it is hereby covenanted and agreed by the
parties hereto as follows:
1. Agreement Period. The Company hereby employs Executive and
Executive hereby agrees to remain in the employ of the Company for an
employment term ("Agreement Period") beginning on the date of this
Agreement, and continuing in effect through December 31, 2004; provided,
however, that if the Executive's employment is terminated for any reason
following a Change in Control (as defined in the Severance Agreement), the
Agreement Period shall terminate upon such termination of employment and
the Executive's rights with respect to such termination of employment
(including the reasons therefor) shall be governed by the provisions of the
Severance Agreement unless the Severance Agreement is not then in effect in
which case the Executive's rights with respect to such termination shall be
governed by the provisions of this Agreement. While Executive is employed
by the Company during the Agreement Period, the Company shall use its best
efforts to have the Board of Directors elect Executive to the offices of
Senior Vice President, General Counsel and Secretary of the Company. As
Senior Vice President, General Counsel and Secretary, Executive shall
assume the authority, duties and responsibilities as are commensurate and
consistent with such positions and titles.
2. Performance of Duties. While employed by the Company
Executive shall devote substantially all his full working time, attention
and energies during normal business hours to the performance of his duties
for the Company and its subsidiaries and shall perform his duties
faithfully and efficiently, subject to the direction of the Company Board
of Directors; provided, however, that Executive may become a director of
other corporations and engage in charitable, civic, professional and other
similar pursuits to the extent that such activities do not significantly
interfere with his duties hereunder.
3. Compensation. As compensation for the performance by
Executive of his obligations hereunder:
(a) Base Salary. During the Agreement Period the
Company shall pay Executive an annual base salary of not less than $134,500
("Base Salary"). Base Salary shall be paid in accordance with the Company's
customary payroll practices. Base Salary may be increased at the discretion
of the Compensation and Stock Option Committee of the Company Board of
Directors (the "Committee") and once so increased shall not thereafter be
decreased, except for across-the-board reductions similarly affecting all
executives of the Company.
(b) Management Incentive Plan. Executive shall
participate in the Company Management Incentive Plan (the "MIP") and/or any
successor plan.
(c) Long Term Incentive Plan. Executive shall
participate in any long-term incentive plan maintained by the Company ("LTI
Plan") for such period of time as such plan may be in effect.
(d) Participation in Benefit Plans. During the
Agreement Period the Executive shall be eligible to participate in all
savings, retirement and welfare benefit plans and programs now or hereafter
applicable to any other senior executives of the Company on a basis no less
favorable than is made available to any other senior executive of the
Company.
(e) Perquisites. During the Agreement Period, the
Company shall make available to the Executive all perquisites that are made
available to Company's senior executives.
4. Termination. The Executive's employment hereunder may be
terminated under the following circumstances:
(a) Death. The Executive's employment hereunder shall
terminate upon his death.
(b) Disability. The Company may terminate the
Executive's employment hereunder for "Disability". Disability means a
mental or physical condition which renders Executive unable or incompetent
to carry out the material job responsibilities which such Executive held or
the material duties to which Executive was assigned at the time the
disability was incurred, which has existed for at least six (6) months and
which in the certified opinion of a physician mutually agreed upon by the
Company and Executive (which agreement neither party shall unreasonably
withhold) is expected to be permanent or to last for an indefinite duration
or a duration in excess of six (6) months.
(c) Cause. The Company may terminate the Executive's
employment hereunder for Cause (as defined in Section 4(c)(iii)) solely in
accordance with the procedures set forth in Section 4(c)(i) if such
termination occurs on or after a Change in Control (as defined in the
Severance Agreement) and Section 4(c)(ii) if such termination occurs prior
to a Change in Control. If the Company fails to comply with each of the
requirements described in Section 4(c)(i) or Section 4(c)(ii), as
applicable, any termination of employment shall be deemed a termination by
the Company without Cause for purposes of this Agreement.
(i) The Company may terminate the Executive's
employment on or after a Change in Control (as defined in the
Severance Agreement) for Cause only upon satisfying each of
the following requirements:
(A) The Company shall have notified Executive in
writing of the conduct allegedly
constituting Cause and the Executive shall
have failed to correct such conduct within
thirty (30) days of the date of his receipt
of such written notice from the Company;
(B) A meeting of the Board shall be called for
the stated purpose of determining whether
Executive's acts or omissions constitute
Cause, whether the Executive failed to
correct such conduct and, if so, whether to
terminate Executive's employment for Cause;
(C) No fewer than forty-five (45) days prior to
the date of such meeting, the Company
provides Executive and each member of the
Board with written notice (the "Notice of
Consideration") of its intent to consider
termination of Executive's employment for
Cause, including (1) a detailed description
of the specific reasons which form the basis
for such consideration, (2) the date, time
and location of such meeting of the Board,
and (3) Executive's rights under clause (D)
below;
(D) Executive shall have the opportunity, if he
so elects, to appear before the Board in
person and, at Executive's option, with
legal counsel, and to present to the Board a
written response to the Notice of
Consideration;
(E) Executive's employment may be terminated for
Cause only if (1) the Executive failed to
correct the conduct constituting Cause
within thirty (30) days of his receipt of
the notice described in clause (A) above,
(2) the acts or omissions specified in the
Notice of Consideration did in fact occur
and do constitute Cause as defined in this
Agreement, (3) the Board makes a specific
determination by an affirmative vote of all
of the members of the Board (excluding for
these purposes Executive) to such effect and
to the effect that Executive's employment
should be terminated for Cause and (4) the
Company thereafter provides Executive with a
Notice of Termination which specifies in
detail the basis of such termination of
employment for Cause and which notice shall
be consistent with the reasons set forth in
the Notice of Consideration.
(ii) The Company may terminate Executive's employment
prior to a Change in Control (as defined in the Severance
Agreement) for Cause only after the Company shall have
notified Executive in writing of the conduct allegedly
constituting Cause and the Executive shall have failed to
correct such conduct within thirty (30) days of the date of
his receipt of such written notice from the Company.
(iii) For purposes of this Agreement, the Company
shall have "Cause" to terminate the Executive's employment
hereunder upon the Executive's:
(A) conviction for the commission of a felony;
or
(B) willful failure to substantially perform his
duties hereunder; or
(C) willful or grossly negligent wrongful
conduct that is demonstrably and materially
injurious to the Company or its affiliates;
or
(D) willful and material breach of this
Agreement, including but not limited to
Section 7 hereof.
For purposes of clauses (B), (C) and (D) of Section 4(c)(iii), Cause shall
not include any act or omission that Executive believed in good faith to
have been in or not opposed to the interest of the Company (without intent
of Executive to gain therefrom, directly or indirectly, a profit to which
he was not legally entitled), or any act or omission of which any member of
the Board, the Chief Executive Officer or any other executive officer of
the Company who is not a party to such act or omission has had actual
knowledge for at least twelve months.
In the event that the existence of Cause shall become an issue in any
action or proceeding between the parties, the Company shall (a) in the case
of Section 4(c)(ii) have the burden of establishing by clear and convincing
evidence that the conduct allegedly constituting Cause did in fact occur
and does constitute Cause and that Executive failed to correct such conduct
and (b) in the case of Section 4(c)(i), notwithstanding the determination
referenced in clause (E) of Section 4(c)(i) above, have the burden of
establishing by clear and convincing evidence that the actions or omissions
specified in the Notice of Consideration did in fact occur and do
constitute Cause, that Executive failed to correct such conduct and that
the Company has satisfied the substantive and procedural requirements of
Section 4(c). Unless the Company so establishes, by clear and convincing
evidence, any termination of employment shall be deemed a termination by
the Company without Cause for all purposes of this Agreement.
(d) Good Reason. The Executive may terminate his
employment hereunder for Good Reason. Good Reason shall mean the occurrence
(without the Executive's written consent) of any one of the following acts
by the Company, or failures by the Company to act:
(i) failure of the Board of Directors of the Company
to elect Executive to the office(s) described in Section 1
hereof; or
(ii) [intentionally omitted]
(iii) any change in (A) the provisions of the
Company's bylaws describing, or (B) the relative duties and
responsibilities of, the office of Senior Vice President,
General Counsel and Secretary; or
(iv) the assignment to Executive of any duties
inconsistent with Executive's status as Senior Vice
President, General Counsel and Secretary or a substantial
adverse alteration in the nature or status of Executive's
responsibilities; or
(v) any reduction by the Company in Executive's Base
Salary, except for across-the-board salary reductions
similarly affecting all executives of the Company; or
(vi) the failure by the Company to pay to Executive
any portion of Executive's current compensation, or to pay to
Executive any portion of an installment of deferred
compensation under any deferred compensation program of the
Company, within seven (7) days of the date such compensation
is due; or
(vii) the taking of any action by the Company which
directly or indirectly causes Executive to cease to be
eligible to participate in all savings, retirement and
welfare benefit plans and programs applicable to any other
senior executives of the Company on a basis no less favorable
than is made available to any other senior executive of the
Company; the failure of the Company to make available to the
Executive all perquisites that are made available to
Company's senior executives; the failure by the Company to
calculate Executive's annual bonus compensation, if any,
using at least the valuation and number of accountability
points used to determine the bonus opportunity in any
previous year during the Agreement Period for any corporate
officer position held by Executive; or the failure by the
Company to provide Executive with the number of paid vacation
days to which Executive may then be entitled; except (as to
all of the foregoing) for changes (including termination) in
such benefits and/or policies similarly affecting all
executives of the Company; or
(viii) the relocation of the Executive's principal
place of employment to a location more than fifty (50) miles
from the Executive's principal place of employment as of the
date hereof or the Company's requiring the Executive to be
based anywhere other than such principal place of employment
(or permitted relocation thereof) except for required travel
on the Company's business to an extent substantially
consistent with the Executive's present business travel
obligations; or
(ix) any purported termination of the Executive's
employment by the Company other than in accordance with this
Agreement; or
(x) [intentionally omitted]
(xi) the Company's material breach of this Agreement.
Notwithstanding the foregoing, no inadvertent and isolated
event shall constitute "Good Reason" unless the Executive shall have
notified the Company in writing of the conduct allegedly constituting Good
Reason and the Company shall have failed to correct such conduct within
thirty (30) days of the date of its receipt of such written notice from the
Executive. Any determination by Executive that any of the foregoing events
has occurred and constitutes Good Reason shall be conclusive and binding
for all purposes unless the Company establishes by clear and convincing
evidence that Executive did not have any reasonable basis for such a
determination.
5. Termination Procedure.
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(a) Notice of Termination. Any termination of the
Executive's employment by the Company or by the Executive (other than
termination pursuant to Section 4(a) hereof) shall be communicated by
written Notice of Termination to the other party hereto in accordance with
Section 9. For purposes of this Agreement, a "Notice of Termination" shall
mean a notice which shall indicate the specific provision in this Agreement
relied upon and shall identify in reasonable detail the reason for
termination of the Executive's employment under the provision so indicated.
(b) Date of Termination. "Date of Termination" shall
mean (i) if the Executive's employment is terminated by his death, the date
of his death, (ii) if the Executive's employment is terminated pursuant to
Section 4(b) above, the date thirty (30) days after Notice of Termination
(provided that the Executive shall not have returned to the performance of
his duties on a permanent full-time basis during such thirty (30) day
period), (iii) if the Executive's employment is terminated pursuant to
Section 4(c) or 4(d) above, the date thirty (30) days after Notice of
Termination and (iv) if the Executive's employment is terminated for any
other reason, the date specified in the Notice of Termination which shall
be not more than thirty (30) days from the date of such Notice.
6. Compensation Upon Termination.
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(a) Termination due to Death or Disability. If the
Executive's employment is terminated by his death or Disability, the
Company shall have no further obligations to provide Executive with the
severance benefits described under Sections 6(b)(i) through (ix) of this
Agreement but shall continue to provide the other payments and benefits
provided for under this Agreement.
(b) Termination By Company without Cause or By
Executive for Good Reason. Upon termination of Executive's employment
hereunder during the Agreement Period by the Company without Cause or by
Executive for Good Reason hereunder, then, in lieu of any further salary,
bonus, or LTI Plan payments for periods subsequent to the Date of
Termination and in lieu of any severance benefit otherwise payable to the
Executive:
(i) The Company shall continue to pay to Executive
Base Salary as of the Date of Termination (without giving
effect to any decrease therein which constitutes the basis,
or one of the bases, upon which the Notice of Termination is
based), for a period of twenty-four (24) months (the
"Severance Period"), payable semi-monthly or more frequently,
in arrears, commencing on the Date of Termination; provided,
however, that if a Change in Control occurs during the
Severance Period, the Company shall pay the Executive by no
later than five (5) days following the Change in Control a
lump sum in cash equal to the sum of the remaining payments
that would have been payable to the Executive hereunder had
no Change in Control occurred, and payments hereunder shall
terminate.
(ii) The Company shall pay the Executive a lump sum
in cash, within ten (10) days of the Date of Termination,
equal to the sum of any unpaid incentive compensation
(including the cash value, determined without regard to any
restrictions on the sale thereof, of restricted stock)
allocated or awarded to Executive under the MIP with respect
to any fiscal year ending prior to the year in which the Date
of Termination occurs.
(iii) The Company shall pay the Executive as bonuses
any amount which would have been payable to Executive under
the MIP for the full fiscal year in which Executive was
terminated and for the full fiscal year following such year.
Such payments will be made within five (5) days of the date
on which MIP payments are made to other MIP participants
after the close of each fiscal year and will include the cash
value, determined without regard to any restrictions on the
sale thereof, of restricted stock. If a Change in Control
occurs prior to either of these two payments, then, in lieu
of any further bonus payments, the Company shall pay
Executive, no later than ten (10) days following the Change
in Control, a lump sum in cash calculated at the "Target"
level for the then current fiscal year for each MIP bonus
payment not yet made.
(iv) The Company shall pay the Executive a lump sum
in cash, within ten (10) days of the Date of Termination,
equal to the sum of (A) any unpaid incentive compensation
(including the cash value, determined without regard to any
restrictions on the sale thereof, of restricted stock)
allocated or awarded to Executive under the LTI Plan with
respect to any performance period ending prior to the Date of
Termination; plus (B) a pro rata portion of the aggregate
value of all contingent incentive compensation (including the
cash value, determined without regard to any restrictions on
the sale thereof, of restricted stock) awards to Executive
with respect to any performance periods under the LTI Plan
which are not completed as of the Date of Termination,
calculated based on the assumption that the Company's results
from the beginning of such performance period(s) to the Date
of Termination would continue at the same rate until the
originally intended completion date(s) of such performance
period(s). The amount set forth in item (B) above shall be
payable to Executive regardless of whether the Company
actually achieves the performance level upon which the
calculation of such amount is based.
(v) During the Severance Period the Company shall
arrange to provide the Executive with life, disability,
accident and health insurance benefits ("Welfare Benefits")
substantially similar in all material respects to those which
the Executive is receiving immediately prior to the Date of
Termination (without giving effect to any decrease therein
which constitutes the basis, or one of the bases, upon which
the Notice of Termination is based), of if such benefits are
not available or the provision of such benefits would not be
allowed under the terms of such plans, the Company shall pay
Executive the after-tax economic equivalent thereof. If the
Executive receives, or becomes eligible to receive, Welfare
Benefits from another source, then the Welfare Benefits
otherwise receivable by the Executive pursuant to this
Section 6(b)(v) shall be reduced to the extent of such other
Welfare Benefits received by, or made available to, the
Executive during the Severance Period (and any such Welfare
Benefits received by or made available to the Executive shall
be reported to the Company by the Executive). Nothing herein
shall be deemed to limit Executive's rights, if any, to
thereafter participate in any retiree medical plan then in
effect.
(vi) During the Severance Period, the Company shall
arrange to provide the Executive with such material
perquisites as are provided to the Executive immediately
prior to the Date of Termination (without giving effect to
any decrease therein which constitutes the basis, or one of
the bases, upon which the Notice of Termination is based).
(vii) Effective as of the Date of Termination, all
stock options (whether or not then fully exercisable) granted
to Executive under any of the Company's stock option plans
prior to the Date of Termination shall become immediately
exercisable and Executive shall be entitled to exercise any
or all of such options at any time prior to the respective
expiration of the term of such options as set forth in the
grant document evidencing same, as though Executive were to
continue as an active employee of the Company for such period
of exercisability.
(viii) Effective as of the Date of Termination, all
restricted stock granted to Executive prior to the date
Executive's employment with the Company is terminated shall
become fully vested and all restrictions thereon shall lapse.
(ix) The Executive shall receive payment of the
incremental qualified and supplemental defined benefit
pension benefits Executive would have earned had Executive's
employment continued during the Severance Period, had he
received credit for service for the Severance Period for all
purposes under the applicable plans, and had the Executive
received compensation during the Severance Period of salary,
at the annual rate equal to the Executive's Base Salary in
effect immediately prior to the Date of Termination (without
giving effect to any decrease therein which constitutes the
basis, or one of the bases, upon which the Notice of
Termination is based), and bonus, at the annual rate equal to
the Target Bonus. Anything in the applicable plan to the
contrary notwithstanding, the net present value of the
Executive's benefit (as increased hereunder) under any
supplemental defined benefit plan maintained by the Company
("SERP Benefit") or under any other deferred compensation
plan shall be paid to the Executive in a lump sum in cash by
no later than ten (10) days following the Date of
Termination. In the event that the supplemental defined
benefit plan or other deferred compensation plan does not
specify the actuarial assumptions for determining present
value, the present value shall be determined using the
actuarial assumptions that would be used by the Pension
Benefit Guaranty corporation for purposes of determining the
present value of a lump sum distribution on plan termination.
(c) Termination by the Company for Cause or By
Executive Other than for Good Reason. If the Executive's employment shall
be terminated by the Company for Cause or by the Executive other than for
Good Reason, the Company shall have no obligations to provide Executive
with the severance benefits described under Sections 6(b)(i) through (ix)
of this Agreement but shall continue to provide the other payments and
benefits provided under this Agreement.
(d) Additional Payments. Following any termination of
Executive's employment, the Company shall pay the Executive all unpaid
amounts, if any, to which the Executive is entitled as of the Date of
Termination under any compensation plan or program of the Company including
but not limited to the Company's deferred compensation, benefit or other
compensation plans or programs, at the time such payments are due. In
addition, within ten (10) days of the Date of Termination, the Company
shall pay the Executive, or his legal representative or estate, as
applicable, any amounts accrued but not paid pursuant to Sections 3(a),
3(b), 3(c), 3(d) and 3(e) in respect of periods ending prior to the Date of
Termination.
7. Confidentiality; Nondisparagement. The Executive shall
hold in a fiduciary capacity for the benefit of the Company all trade
secrets, confidential information, and knowledge or data relating to the
Company and its affiliates which shall have been obtained by the Executive
during the Executive's employment by the Company and which shall not have
been or now or hereafter have become public knowledge (other than by acts
by the Executive or representatives of the Executive in violation of this
Agreement). The Executive shall not, without the prior written consent of
the Company, or as may otherwise be required by law or legal process,
communicate or divulge any such trade secrets, information, knowledge or
data to anyone other than the Company and those designated by the Company.
In addition, the Executive and the Company or its affiliates shall not
disparage, discredit or otherwise publicly criticize the other or engage in
any act, directly or indirectly, for purposes of disparaging, ridiculing or
bringing scorn upon the Executive or the Company, any affiliate thereof, or
any of their respective officers, directors, businesses, tradenames or
trademarks. In the event of a breach or threatened breach of this Section
7, each party shall be entitled to injunctive relief in a court of
appropriate jurisdiction to remedy any such breach or threatened breach,
the parties acknowledging that damages would be inadequate and
insufficient. Any termination of the Executive's employment, Agreement
Period or of this Agreement shall have no effect on the continuing
operation of this Section 7.
8. Amendment. This Agreement may be amended in writing by
mutual agreement of the parties without the consent of any other person
and, during the life of Executive, no person, other than the parties
hereto, shall have any rights under or interest in this Agreement or the
subject matter hereof.
9. Notice. Any notice required or permitted to be given under
this Agreement shall be sufficient if in writing and, if (i) sent by
registered mail or certified mail, or (ii) personally delivered, or (iii)
sent via nationally recognized courier service, to the Company at its
principal executive offices, to the attention of its Chief Executive
Officer, or to Executive at the last address filed by him in writing with
the Committee, as the case may be.
10. Nonalienation. The interests of Executive under this
Agreement are not subject to the claims of his creditors, other than the
Company and its subsidiaries, and may not otherwise be voluntarily or
involuntarily assigned, alienated or encumbered.
11. Successors. This Agreement shall be binding upon, and
inure to the benefit of, the Company and its successors and assigns and
upon any person acquiring, whether by merger, consolidation, purchase of
assets or otherwise, all or substantially all of the Company's assets and
business.
12. Severability. If, for any reason, any provision of this
Agreement is held invalid, such invalidity shall not affect any other
provision of this Agreement not held so invalid, and each such other
provision shall to the full extent consistent with law continue in full
force and effect. If any provision of this Agreement shall be held invalid
in part, such invalidity shall in no way affect the rest of such provision
not held so invalid, and the rest of such provision, together with all
other provisions of this Agreement, shall to the full extent consistent
with law continue in full force and effect.
13. Applicable Law. The provisions of this Agreement shall be
construed in accordance with the internal laws of the State of Illinois
without regard to common law conflicts of laws principles.
14. Counterpart. The Agreement may be executed in two or more
counterparts, any one of which shall be deemed the original without
reference to the others.
15. Attorney's Fees. Company shall reimburse Executive for
all reasonable legal fees, accounting, expert witness or other fees, costs
or expenses which Executive may incur (together with an additional amount
such that the net amount retained by Executive, after deduction of any
federal, state and local income and employment taxes on the total
reimbursements made pursuant to this paragraph equal the amount of fees,
costs and expenses reimbursed pursuant to this paragraph) in respect of any
dispute or controversy arising under or in connection with this Agreement;
provided, however, that the Company shall not reimburse such legal fees and
costs and other fees and expenses if the fact finder determines that the
action brought by the Executive was frivolous. The amount of taxes for
which the additional amount is paid to Executive shall be determined using
the highest effective marginal rate of taxation in each case (taking into
account the phase out of itemized deductions, if applicable).
16. Interest on Late Payments. If the Company fails to pay
any amount provided under this Agreement when due, the Company shall pay
interest, compounded monthly, on such amount at a rate equal to the lesser
of (a) (i) the highest rate of interest charged by the Company's principal
lender on its revolving credit agreements as in effect from time to time
during the period of such nonpayment plus 200 basis points, or (ii) in the
absence of such a lender, 300 basis points over the prime commercial
lending rate announced by The Wall Street Journal in effect from time to
time during the period of such nonpayment, or (b) the highest
legally-permissible interest rate allowed to be charged under applicable
law.
17. Beneficiaries. If Executive should die while any amount
is payable to him hereunder, such amount shall be paid to Executive's
devisee, legatee or other designee or, if there is no such designee, to
Executive's estate.
18. WAIVER OF JURY TRIAL. THE COMPANY AND EXECUTIVE WAIVE
THEIR RIGHTS TO REQUEST A JURY TRIAL IN ANY LAWSUIT RELATING TO THIS
AGREEMENT.
19. Mitigation. Executive shall not be required to mitigate
damages or the amount of any payment provided for under this Agreement by
seeking (and, except as provided in Section 6(b)(v), no payment otherwise
required hereunder shall be reduced on account of) other employment.
20. Letter of Credit. The Company shall establish irrevocable
standby letters of credit issued by The Bank of New York or another bank
having combined capital and surplus in excess of $500 million to secure the
Company's obligations to Executive. Said letters of credit shall be
established prior to an Imminent Control Change Date (as defined in the
Severance Agreement), and shall be as follows:
(a) one letter of credit, in substantially the form
attached hereto, to secure the payment of legal fees and related tax
gross-up payment as provided for under Section 16 of the Executive's
Severance Agreement in the amount of $5 million, which amount shall be
available to the Executive and each other person covered by the letter of
credit; and
(b) one letter of credit, in substantially the form
attached hereto, to secure the other payments and benefits provided for
under the Executive's Severance Agreement in an amount which is not less
than the amount of severance and other benefits (the "Severance Benefits")
that would be payable to the Executive pursuant to the Severance Agreement
if the Executive is terminated by the Company without Cause following a
Change in Control, which amount shall be available solely to the Executive.
The amount of the letter of credit described in Section 20(b) above, shall
be increased by the Company from time to time so that the amount is never
less than the amount of the Executive's Severance Benefits. The letters of
credit described in Sections 20(a) and 20(b) may expire on the date on
which the Imminent Control Change Date (as defined in the Severance
Agreement) ceases to exist. Upon a Change in Control, the letters of credit
shall remain in effect and shall not be subject to termination prior to
their respective Expiry Dates as provided in each such letter of credit.
21. Escrow Account. The Company shall establish an escrow
account for each of the letters of credit described in Section 20 at the
time the letters of credit are established by entering into escrow
agreements with LaSalle Bank National Association, or another bank having
combined capital and surplus in excess of $100 million in substantially the
forms attached hereto.
IN WITNESS WHEREOF, Executive has hereunto set his hand, and
the Company has caused these presents to be executed in its name and on its
behalf, and its corporate seal to be hereunto affixed and attested by its
Assistant Secretary, all as of the day and year first above written.
/s/ XXXXX X. XXXXXXX
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Xxxxx X. Xxxxxxx
Attest: HARTMARX CORPORATION
/s/ XXXXX X. XXXXXX By: /s/ XXXX X. XXXXX
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Xxxxx X. Xxxxxx Xxxx X. Xxxxx, President and
Assistant Secretary Chief Executive Officer
