Exhibit 10.7
[logo]
XXXX NATIONAL
November 17, 2003
Xxx Xxxx
Senior Vice President and Controller
Dear Xxx:
You are party to a letter agreement dated May 31, 2000 with Xxxx
National Corporation (the "Company") pursuant to which the Company has agreed to
provide you with salary continuation in the event that your employment is
terminated under circumstances specified therein (the "Letter Agreement"). This
letter will serve to inform you of enhancements to the salary continuation set
forth in the Letter Agreement that you will receive in connection with certain
terminations of employment as described below. The provisions of this letter
will only be effective upon a Change of Control of the Company (as defined in
Exhibit A hereto).
Notwithstanding anything in the Letter Agreement to the contrary, in
the event that your employment with the Company terminates within one year
following a Change of Control for reasons that would entitle you to salary
continuation under the Letter Agreement (a "Qualifying Termination"), for the
period with respect to which you are entitled to receive salary continuation
under the Letter Agreement, the Company shall continue health care, dental and
term life benefits for you and/or your family substantially similar to those
that were provided to you and/or your family immediately prior to such
Qualifying Termination or, if more favorable to you, as in effect generally at
any time thereafter with respect to similarly situated employees of the Company
and its affiliates and their families at the same cost to you as such benefits
are provided to similarly situated active employees of the Company and its
affiliates (and immediately following such continuation period you and your
dependents shall be eligible for "COBRA" continuation coverage under Section
4980B of the Internal Revenue Code of 1986, as amended, or any successor
provision); provided, however, that, if you become reemployed with another
employer and are eligible to receive such benefits under another
employer-provided plan, the medical and other welfare benefits described herein
shall be secondary to those provided under such other plan. In addition, upon a
Qualifying Termination, the Company shall, at its sole expense as incurred,
provide you with reasonable outplacement services the scope and provider of
which shall be selected by the Company in its sole discretion, provided that the
cost of such outplacement shall not exceed $10,000 (it being understood the you
shall have no right or entitlement to receive a cash payment in lieu of such
outplacement services).
In addition, notwithstanding anything in the Letter Agreement to the
contrary, in the event of a Qualifying Termination, the Company's obligation to
make the payments provided for in the Letter Agreement and hereunder and
otherwise to perform its obligations under the Letter Agreement and hereunder
shall not be affected by any set-off, counterclaim, recoupment, defense, or
other claim, right or action that the Company may have against you or others.
Notwithstanding anything in the Letter Agreement to the contrary, in the event
of a Qualifying Termination, in no event shall you be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable
to you under any of the provisions of the Letter Agreement, and such amounts
shall not be reduced whether or not you obtain other employment.
This letter shall be binding upon any successor of the Company or its
businesses (whether direct or indirect, by purchase, merger, consolidation or
otherwise), in the same manner and to the same extent that the Company would be
obligated under this letter if no succession had taken place. In the case of any
transaction in which a successor would not by the foregoing provision or by
operation of law be bound by this letter, the Company shall require such
successor expressly and unconditionally to assume and agree to perform the
Company's obligations under this letter, in the same manner and to the same
extent that the Company would be required to perform if no such succession had
taken place. The term "Company," as used in this letter, shall mean the Company
as hereinbefore defined and any successor or assignee to the business or assets,
which by reason hereof becomes bound by this Agreement.
This letter agreement shall be governed by, and construed in accordance
with, the laws of the State of Ohio, without reference to its conflict of law
rules. All benefits hereunder are subject to withholding for applicable income
and payroll taxes or otherwise as required by law.
In all other respects, the terms of the Letter Agreement shall survive
in full force and effect.
Very truly yours,
/s/ Xxxxxxxx X. Xxxxxx
Xxxxxxxx X. Xxxxxx
Xx. Vice President & Chief Administrative Officer
Exhibit A
"Change of Control" means the first to occur of:
(1) The acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act")) (a "Person") of beneficial ownership (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of 35% or more of either (A)
the then-outstanding shares of common stock of the Company (the "Outstanding
Company Common Stock") or (B) the combined voting power of the then-outstanding
voting securities of the Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting Securities"); provided, however,
that, for purposes of this definition, the following acquisitions shall not
constitute a Change of Control: (i) any acquisition directly from the Company,
(ii) any acquisition by the Company, (iii) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any of
its affiliates or (iv) any acquisition by any corporation pursuant to a
transaction that complies with clauses (3)(A), (3)(B) and (3)(C) of this
definition;
(2) Any time at which individuals who, as of the date hereof, constitute the
Board (the "Incumbent Board") cease for any reason to constitute at least a
majority of the Board; provided, however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Company's stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board;
(3) Consummation of a reorganization, merger, statutory share exchange or
consolidation or similar corporate transaction involving the Company or any of
its subsidiaries, a sale or other disposition of all or substantially all of the
assets of the Company, or the acquisition of assets or stock of another entity
by the Company or any of its subsidiaries (each, a "Business Combination"), in
each case unless, following such Business Combination, (A) all or substantially
all of the individuals and entities that were the beneficial owners of the
Outstanding Company Common Stock and the Outstanding Company Voting Securities
immediately prior to such Business Combination beneficially own, directly or
indirectly, more than 50% of the then-outstanding shares of common stock and the
combined voting power of the then-outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation that, as a result of such transaction, owns the Company or all or
substantially all of the Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership
immediately prior to such Business Combination of the Outstanding Company Common
Stock and the Outstanding Company Voting Securities, as the case may be, (B) no
Person (excluding any corporation resulting from such Business Combination or
any employee benefit plan (or related trust) of the Company or such corporation
resulting from such Business Combination) beneficially owns, directly or
indirectly, 35% or more of, respectively, the then-outstanding shares of common
stock of the corporation resulting from such Business Combination or the
combined voting power of the then-outstanding voting securities of such
corporation, except to the extent that such ownership existed prior to the
Business Combination, and (C) at
least a majority of the members of the board of directors of the corporation
resulting from such Business Combination were members of the Incumbent Board at
the time of the execution of the initial agreement or of the action of the Board
providing for such Business Combination; or
(4) Approval by the stockholders of the Company of a complete liquidation or
dissolution of the Company.
