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Exhibit (10m)
AMENDED AND RESTATED EMPLOYMENT AGREEMENT DATED
APRIL 1, 2001, BY AND BETWEEN THE COMPANY AND XXXX X. XXXX
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AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this
"Agreement"), made and entered into and to become effective on the 1st day of
April, 2001 (the "Effective Date"), by and between XXXXXXX CORPORATION, an
Alabama Corporation (the "Company"), and XXXX X. XXXX (the "Executive").
RECITALS:
WHEREAS, the Company and its affiliates are engaged in the
knit products industry. The Executive is experienced in, and knowledgeable
concerning, the knit products industry. The Company desires to continue to
employ the Executive as President, Chief Executive Officer and Chairman of the
Board, and the Executive desires to continue to be employed by the Company in
that capacity;
WHEREAS, the Company and the Executive entered into that
certain Employment Agreement dated as of March 31, 1998, which was subsequently
amended effective November 1, 1999 and which has a term through and including
March 31, 2001; and
WHEREAS, the Company and the Executive desire to amend and
restate that Employment Agreement as set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants
and obligations herein and the compensation the Company agrees herein to pay the
Executive, and of other good and valuable consideration, the receipt of which is
hereby acknowledged, the Company and the Executive agree as follows:
ARTICLE 1. EMPLOYMENT OF EXECUTIVE. Subject to the terms and
conditions set forth in this Agreement, the Company hereby employs the Executive
and the Executive hereby accepts such employment for the period stated in
ARTICLE 3 of this Agreement.
ARTICLE 2. POSITION, RESPONSIBILITIES AND DUTIES.
2.1 Position and Responsibilities. During the Term (as
defined in Article 3. 1), the Executive shall serve as President, Chief
Executive Officer and Chairman of the Board of Directors (pursuant to
Article 2.3) of the Company on the conditions herein provided. The
Executive shall have overall executive authority and responsibility for
the Company and its subsidiaries, with all officers, employees, and
consultants of the Company and its subsidiaries reporting directly (or
indirectly through subordinates designated by the Executive) to the
Executive. The Executive shall provide such executive services in the
management of the Company's business not inconsistent with his position
and the provisions
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of Article 2.2 as shall be assigned to him from time to time by the
Board of Directors of the Company (the "Board").
2.2 Duties. During the Term and except for illness,
reasonable vacation periods, and reasonable leaves of absence, the
Executive shall devote his full business time, attention, skill,
energies and efforts to the faithful performance of his duties
hereunder and to the business and affairs of the Company and any
subsidiary or affiliate of the Company, such duties being those
customary to executives at the same level in companies of similar size.
The Executive shall work to maximize shareholder value while being
sensitive to the impact on employees and communities. To maximize
shareholder value, significant changes will need to be made,
potentially including but not limited to relocation or closing of
manufacturing facilities or other operations, restructuring, closing or
selling poor return businesses, establishment of nationally competitive
compensation plans and replacement of management, contractors and
consultants as necessary. Notwithstanding the foregoing, the duties of
the Executive shall not be expanded or diminished without the
Executive's prior approval.
2.3 Title.
(a) The Executive shall be President, Chief Executive
Officer, and Chairman of the Board of Directors of the Company, with
the Board of Directors to elect, re-elect, and appoint the Executive to
those offices throughout the Term.
(b) The Executive shall hold the office of President for
such time after the Effective Date that he feels necessary. At any time
after the Effective Date, the Executive may, in his best judgment,
relinquish the title of President for the purpose of hiring or
promoting a new President and Chief Operating Officer of the Company.
2.4 Other Activities. Notwithstanding any other provision
herein to the contrary, the Executive may serve on corporate, civic,
and/or charitable boards or committees as he deems appropriate.
ARTICLE 3. TERM.
3.1 Term of Employment. The term ("Term") of the
Executive's employment under this Agreement shall commence on the
Effective Date and shall continue until the earliest to occur of the
following dates (the "Termination Date"): (i) March 31, 2006; (ii) the
date of death of the Executive; (iii) the date coinciding with the end
of one hundred eighty (180) days of continuous "Total Disability" of
the Executive (as defined in Article 7.4); (iv) the effective date of a
termination by the Company, including any termination by the Company
For Cause (as defined in and pursuant to Articles 3.2 and 3.5); or (v)
the effective date of the Executive's resignation, including but not
limited to termination by the Executive for Good Reason (as defined in
and pursuant to Articles 3.3 and 3.5).
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3.2 Termination for Cause; Automatic Termination. The
Company shall at all times have the right to discharge the Executive
For Cause (as defined herein), For purposes of this Agreement, "For
Cause" shall be limited to: (i) conviction of a felony other than those
felonies involving the use of an automobile in violation of any vehicle
statute; (ii) a material breach of a provision of this Agreement by the
Executive, which breach is not cured within thirty (30) days after
Notice of Breach (as defined below) has been given by the Company to
the Executive; or (iii) the Final Determination of any action the
effect of which is to permanently enjoin the Executive from fulfilling
his duties under this Agreement. "Final Determination" as used herein
shall mean the exhaustion of all available remedies and appeals by the
Executive or the Executive's refusal to pursue such remedies and
appeals.
Notwithstanding the foregoing, no termination of employment For Cause
pursuant to (ii) above shall occur and become effective unless and
until: (1) no fewer than thirty (30) days prior to the date of the
Notice of Termination (as defined in and pursuant to Article 3.5), the
Company provides the Executive with written notice ("Notice of Breach")
of its intent to terminate the Executive's employment For Cause, with
said Notice of Breach to contain a detailed description of the specific
reasons which form the basis for such intent; (2) during such thirty
(30) day period after the date of said Notice of Breach is provided but
before said Notice of Termination is provided, the Executive shall have
the opportunity, with or without legal representation, to appear before
the Board (and/or to present written materials to the Board, at the
Executive's election) in order to present arguments on his own behalf-,
and (3) the Executive shall thereafter be terminated For Cause only if
(a) three-quarters of the members of the Board determine that the
actions of the Executive as set forth in the Notice of Breach
constituted Cause and that the Executive's employment should
accordingly be terminated For Cause; and (b) the Board then provides
the Executive with a Notice of Termination (as defined in and pursuant
to Article 3.5), consistent with the basis set forth in said Notice of
Breach, detailing the basis of such For Cause termination of
employment.
3.3 Good Reason. Subject to the requirements of Article
3.5 of this Agreement, the Executive may terminate his employment at
any time for Good Reason (as defined in this Article 3.3). If the
Executive desires to terminate his employment for Good Reason, he shall
give notice to the Company as provided in Article 3.5. For purposes of
this Agreement, "Good Reason" shall mean the Executive's resignation
from the Company's employment for any of the following reasons:
(a) Failure by the Board or the Company's
shareholders to reelect or reappoint the Executive as
President (subject to Article 2.3), Chief Executive Officer,
and/or Chairman of the Board of the Company, provided that the
Executive then elects to leave the Company's employment within
six (6) months of such failure to so reelect or reappoint the
Executive;
(b) A material modification by the Board of the
duties, functions and responsibilities of the Executive as
President (subject to 2.3) or Chief Executive
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Officer without his written consent given within six (6)
months prior to such modification;
(c) The relocation of the Company's executive
headquarters outside the Atlanta, Georgia metropolitan area
without the Executive's prior written consent;
(d) A Change of Control (defined in this Article
3.3(d)) of the Company provided that the Executive terminates
his employment (for any reason or no reason) within two (2)
years from the date the Change of Control becomes effective.
Change in Control of the Company shall be deemed to have
occurred as of the first day that any one or more of the
following conditions shall have been satisfied:
(i) Any person (other than those Persons in
control of the Company as of the Effective
Date, or other than a trustee or other
fiduciary holding securities under an
employee benefit plan of the Company, or a
corporation owned directly or indirectly by
the stockholders of the Company in
substantially the same proportions as their
ownership of stock of the Company), becomes
the Beneficial Owner, directly or
indirectly, of securities of the Company
representing thirty percent (30%) or more
of the combined voting power of the
Company's then outstanding securities; or
(ii) During any period of two (2) consecutive
years (not including any period prior to
the Effective Date), individuals who at the
beginning of such period constitute the
Board (and any new Director, whose election
by the Company's stockholders was approved
by a vote of at least two-thirds (2/3) of
the Directors then still in office who
either were Directors at the beginning of
the period or whose election or nomination
for election was so approved (a "Continuing
Director")), cease for any reason to
constitute a majority thereof; or
(iii) The stockholders of the Company approve: (A)
a plan of complete liquidation of the
Company; or (B) an agreement for the sale or
disposition of all or substantially all of
the Company's assets; or (C) a merger,
consolidation, or reorganization of the
Company with or involving any other
corporation other than a merger,
consolidation, or reorganization that would
result in the voting securities of the
Company outstanding immediately prior
thereto continuing to represent (either by
remaining outstanding or by being converted
into voting securities of the surviving
entity), at least fifty percent (50%) of the
combined voting power of the voting
securities of the Company (or such surviving
entity) outstanding immediately after such
merger, consolidation, or reorganization.
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However, in no event shall a "Change in
Control" be deemed to have occurred, with
respect to a Participant, if the Participant
is part of a purchasing group which
consummates the Change-in-Control
transaction. A Participant shall be deemed
"part of a purchasing group" for purposes of
the preceding sentence if the Participant is
an equity participant in the purchasing
company or group (except for: (i) passive
ownership of less than three percent (3%) of
the stock of the purchasing company; or (ii)
ownership of equity participation in the
purchasing company or group which is
otherwise not significant, as determined
prior to the Change in Control by a majority
of the nonemployed continuing Directors).
(e) Any material breach of a provision of this
Agreement by the Company, which breach is not cured within
thirty (30) days after notice has been given to the Company by
the Executive as provided in Article 3.5. Without limiting the
generality of the foregoing sentence, the Company shall be in
material breach of its obligations hereunder if, for example,
the Company shall not permit the Executive to exercise such
responsibilities as are consistent with the Executive's
position as described in Article 2.2 herein and are of such a
nature as are usually associated with such officers of other
public corporations of approximately equal size, or the
Executive shall at any time be required to report to anyone
other than directly to the Board, or the Company shall fail to
make a payment when due to the Executive. Notwithstanding the
foregoing, if the Executive desires to terminate his
employment for Good Reason under this Article 3.3(e), he shall
give notice to the Company as provided in Article 3.5 and the
Company shall have thirty (30) days after notice has been
given to it in which to cure the reason for the Executive's
desire to terminate his employment for Good Reason. If the
reason for the Executive's desire to terminate his employment
for Good Reason under this Article 3.3(e) is timely cured by
the Company within such thirty (30) day period, the
Executive's notice shall become null and void.
3.4 Retirement. Upon the Termination Date hereof
(including but not limited to any termination of the Executive's
employment due to death of the Executive or Total Disability of the
Executive (as defined in Article 7.4) or either by the Company (whether
or not For Cause) or the Executive (with or without Good Reason)), said
termination of employment shall be treated as retirement of the
Executive for the purpose of all Xxxxxxx plans and benefits. For
purposes of Xxxxxxx'x defined benefit retirement plan and its
Supplemental Executive Retirement Plan ("SERP"), each year (or portion
thereof) of the Executive's employment with the Company from January 1,
1998 through the effective Termination Date shall count and serve as
two (2) years of employment pursuant to the SERP program implemented by
the Company in the year 2000, which program was retroactive to January
1, 1998. The provisions and rights of the Executive as enumerated
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under this Article 3.4 upon any said termination of employment are in
addition to any and all other rights and benefits to which the
Executive is entitled (or those in which the Executive is otherwise
vested or which the Executive has otherwise earned) under the terms of
this Agreement (including but not limited to those rights described in
Articles 5, 6, 11, and 12), the aforementioned Employment Agreement
dated as of March 31, 1998 (which was subsequently amended effective
November 1, 1999 and which has a term through and including March 31,
2001), and/or the Amended and Restated Executive Deferred Compensation
and Buyout Plan (or its predecessor), which is incorporated herein by
reference as set forth in Article 30.
3.5 Notice of Termination. Any termination by the
Executive for Good Reason or by the Company For Cause shall be
communicated by Notice of Termination to the Company or the Executive,
as the case may be. For purposes hereof, a "Notice of Termination"
means a written notice which (i) indicates the specific termination
provision relied upon in this Agreement, (ii) sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for
termination of the Executive's employment under the provision so
indicated and (iii) sets forth the Termination Date. If the Executive's
employment is terminated by reason of one of the events described in
Article 3.2 [other than 3.2(i)], 3.3(c), or 3.3 (e), the effective
Termination Date shall be not less than thirty (30) days nor more than
forty-five (45) days after the receipt of the Notice of Termination by
the Executive or the Company, as the case may be. If the Executive's
employment is terminated by reason of one of the events described in
Article 3.3(a) or 3.3(b), the effective Termination Date shall be not
more than fifteen (15) days after the receipt of the Notice of
Termination by the Company.
ARTICLE 4. COMPENSATION.
4.1 Base Salary. For all services rendered by the
Executive during the Term, the Company shall pay the Executive as
compensation a base annual salary (the "Base Salary"), payable in
appropriate installments to conform with regular payroll dates for
salaried personnel of the Company. Retroactive to February 28, 2001
from the Effective Date, the annual rate of the Executive's Base Salary
shall be, at a minimum, $700,000 (the "Annual Base Salary Rate"), and,
effective March 1, 2001, the minimum Annual Base Salary Rate of the
Executive shall be $750,000. The Executive's Annual Base Salary Rate
shall be reviewed and increased annually by the Board at the Board's
discretion (with the timing of any such increase(s) coinciding with the
increase(s) of other top executives of the Company and consistent with
Company policy) and, as increased, shall thereafter be the Annual Base
Salary Rate of the Executive for purposes of this Agreement; provided,
however, that the Executive's Annual Base Salary Rate shall at no time
be decreased without the prior written consent of the Executive and
such Annual Base Salary Rate shall, at a minimum, be increased in
accordance with and to reflect any applicable inflationary,
cost-of-living index adjustments over the Term of this Agreement.
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4.2 Bonus. In addition to the Base Salary provided for in
Article 4.1 and the other benefits provided for in this Agreement, the
Executive shall receive each year a target annual bonus ("Target
Bonus") of at least 70% of the Executive's Base Salary for said year in
the event the Company meets and achieves its reasonable financial plans
and projections as set forth in its annual Business Plan for said year.
Said criteria as to payment of said Target Bonus may be changed or
otherwise altered if the Executive and the Company mutually agree in
writing as to said change and criteria. In addition, the Executive
shall also be eligible to receive each year a total annual bonus
("Total Bonus") of at least 140% of the Executive's Base Salary for
said year (inclusive of the aforementioned Target Bonus paid to the
Executive for said year) upon the achievement of certain goals
established by the Board, including but not necessarily limited to the
aforementioned criteria for said Target Bonus. Provided, however, that
if applicable threshold levels for the Target Bonus are met but the
above-referenced criteria for the Target Bonus and Total Bonus are not
achieved, then the Executive shall receive pro-rata shares of said
Target Bonus and Total Bonus equal to the percentages of the
above-referenced criteria (for the Target Bonus and Total Bonus) that
were achieved.
ARTICLE 5. STOCK OPTIONS. In addition to the Base Salary and
Bonus compensation provided to the Executive pursuant to Article 4, the Board,
in its discretion and during the Term, may grant options to the Executive for
the purchase of Xxxxxxx Corporation common stock; provided, however, that in the
first quarter of each of the 2003, 2004, 2005, and 2006 calendar years, the
Board shall make an annual grant of not less than 100,000 said options to the
Executive, which amount may be increased at the Board's discretion based on the
Executive's performance. The exercise price for these options shall equal the
average of the high and low of the stock price on the day the grant is made.
Such options shall have a term of ten years (as described below), and one-fourth
of the total options given in any such year shall vest on and as of each of the
four (4) anniversary dates following the date of said grant. Provided, however,
that if (a) this Agreement expires or (b) the Executive's employment is
terminated (1) because of the Executive's death or Total Disability or (2) by
the Company for any reason other than For Cause, all options granted under this
Article 5 (whether or not vested) shall immediately become vested and shall be
exercisable at the Executive's option for a period of ten (10) years from the
date of the respective grant; if the Executive's employment is terminated by the
Executive for Good Reason, all options granted under this Article 5 (whether or
not vested) shall immediately become vested and shall be exercisable at the
Executive's option for a period of ten (10) years from the date of the
respective grant; and if the Executive's employment is terminated by the Company
For Cause or by the Executive not for Good Reason, all options granted under
this Article 5 that are not vested as of the Termination Date shall lapse and be
forfeited to the Company, with those vested options as of said Termination Date
being exercisable at the Executive's option for a period of ten (10) years from
the date of the respective grant.
In addition, all options granted by the Company to the Executive
pursuant to Article 5 of that Employment Agreement dated as of March 31, 1998
between the Company and the Executive (which Employment Agreement was
subsequently amended effective November 1, 1999) shall have
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a term of ten (10) years from the date of the respective grant and shall become
fully vested (to the extent said options are not already vested) as of March 31,
2001.
ARTICLE 6. SUPPLEMENTAL BENEFITS
6.1 Special Health Care Benefit. In addition to the other
benefits provided for in this Agreement (including participation by the
Executive and his spouse in the Company Plan (as defined herein) during
the Term of this Agreement), the Executive (or his spouse if the
Executive predeceases his spouse before he attains the age of 65) shall
be entitled, for the period commencing on the effective Termination
Date (whether by expiration of this Agreement or by termination of the
Executive's employment by either the Company or the Executive for any
reason) and ending on the earlier of (i) the date of death for the
survivor of the Executive and his spouse or (ii) the Executive and his
spouse attaining the age of 65 (the "Coverage Period"), to participate,
at the Executive's expense (which shall be no more than and limited to
the then-current expense and rate normally payable by the Company's
senior executives for purposes of coverage and benefits under the
Company Plan as provided herein), in any group health plan or program
(whether insured or self-insured, or any combination thereof) provided
by the Company for the benefit of its active employees (the "Company
Plan"). The Company, consistent with sound business practices, shall
use its best efforts to provide the Executive with coverage for the
Executive and his spouse under the Company Plan during the Coverage
Period (and any period thereafter to the extent required by applicable
state and federal law), including, if necessary, amending the
applicable provisions of the Company Plan and negotiating the addition
of any necessary riders to any group health insurance contract. In the
event the Company is unable for whatever reason to provide the
Executive and his spouse with coverage under the Company Plan, the
Company, at the Executive's expense (which shall be no more than and
limited to the then-current expense and rate normally payable by the
Company's senior executives for purposes of coverage and benefits under
the Company Plan as provided herein), shall provide the Executive with
an individual policy of health insurance providing coverage for the
Executive and his spouse (the "Individual Policy") during the Coverage
Period. The coverage to be provided to the Executive and his spouse
pursuant to this ARTICLE 6 (whether under the Company Plan or the
Individual Policy) shall consist of coverage which, as of the time the
coverage is being provided, is identical (or, with respect to an
Individual Policy, substantially identical) to the coverage provided
under the Company Plan to active employees and their dependents.
Notwithstanding the foregoing, the Company shall coordinate coverage
for the Executive under this ARTICLE 6 with any applicable federal or
state government programs (e.g., Medicare or Medicaid) when the
Executive (or his spouse) is eligible to begin receiving benefits under
such program. Any premiums required to be paid for coverage of the
Executive (or his spouse) under such government programs shall be paid
by the Executive (or his spouse).
6.2 Life Insurance. During the Term of this Agreement,
the Company shall provide and be responsible for up to an additional
$16,000.00 for insurance and/or other benefits for the
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Executive and shall also be responsible for any and all subsequent,
applicable inflationary increases/escalators over the Term of this
Agreement as required to continue to provide and maintain said
insurance and/or other benefits for the Executive. The Company shall be
required, upon the Executive's request and his sole discretion, to
convert said insurance (or other benefits) to any other benefits for
the Executive (including but not limited to split life, etc.) and shall
also be required, if requested by the Executive for estate planning or
other purposes, to convert certain compensation (or other benefits)
payable or available to the Executive (under this Agreement or
otherwise) into (or to otherwise "trade" said compensation or benefits
for) other benefits for the Executive (including but not limited to
split life, etc.) The provisions and rights of the Executive as
enumerated in this Article 6.2 are in addition to (and not in lieu of
or as substitute for) any and all other rights and benefits to which
the Executive is entitled (or those in which the Executive is otherwise
vested or which the Executive has otherwise earned) under the terms of
this Agreement, the aforementioned Employment Agreement dated as of
March 31, 1998 (which was subsequently amended effective November 1,
1999 and which has a term through and including March 31, 2001), and/or
the Amended and Restated Executive Deferred Compensation and Buyout
Plan (or its predecessor), which is incorporated herein by reference as
set forth in Article 30.
6.3 Corporate Automobile. During the Term of this
Agreement, an automobile of appropriate value shall be provided by the
Company. All operating and maintenance expenses of the automobile shall
be paid by the Company.
6.4 Corporate Aircraft. During the Term of this
Agreement, the Executive shall have the use of corporate aircraft for
his business and personal transportation at his discretion and at no
cost to him, including reasonable access for his spouse. Applicable
income taxes that are attributable to the Executive's personal use of
the aircraft, as calculated in an acceptable manner that is the most
favorable to the Executive from said tax standpoint, shall be paid by
the Executive.
6.5 Club Memberships. During the Term of this Agreement,
the Company shall make available, at its own expense, country club
access and membership(s) for the Executive and his family near each
corporate headquarters of the Company.
6.6 Immediate Eligibility. Any delay in eligibility and
any waiting period normally associated with the receipt of any of the
benefits provided for by this Agreement shall be waived and the
Executive (and his spouse where applicable) shall be eligible to
receive benefits as of the Effective Date as if such delays and waiting
periods have been satisfied. Notwithstanding the foregoing, this
Article 6.7 shall not apply to the qualified retirement plans of
Xxxxxxx if waiving the eligibility requirements or any associated
waiting periods would cause a violation under ERISA.
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ARTICLE 7. DISABILITY BENEFITS.
7.1 Commencement of Total Disability. If the Executive
suffers a "Total Disability" (as defined in Article 7.4), he shall be
deemed totally disabled ("Totally Disabled") for purposes of this
Agreement as of the date such Total Disability commenced.
7.2 Benefits Payable Upon Total Disability. In the event
of the Total Disability of the Executive, the Company shall continue to
pay the Executive his Base Salary during the Disability Period (as
defined in this Article 7.2); provided, however, that if the Term shall
otherwise expire during the Disability Period pursuant to the
provisions of ARTICLE 3, the Company shall cease paying the Executive
his Base Salary under this Article 7.2 as of the Termination Date, and
the remaining provisions of this Agreement shall apply. In the event
that the Executive's Total Disability continues for a period of one
hundred eighty (180) days (measured from the date the Executive became
Totally Disabled), the Term shall automatically expire and terminate,
as provided in subparagraph (iii) of Article 3. 1, at the end of such
one hundred eighty day period (the "Disability Period"), with said
termination of the Executive's employment being treated, as provided in
Article 3.4, as retirement of the Executive for purposes of all Xxxxxxx
plans and benefits. The provisions and rights of the Executive as
enumerated under this Article 7 upon any said termination of employment
in the event of Total Disability of the Executive are in addition to
any and all other rights and benefits to which the Executive is
entitled (or those in which the Executive is otherwise vested or which
the Executive has otherwise earned) under the terms of this Agreement
(including but not limited to those rights described in Articles 5, 6,
11, and 12), the aforementioned Employment Agreement dated as of March
31, 1998 (which was subsequently amended effective November 1, 1999 and
which has a term through and including March 31, 2001), and/or the
Amended and Restated Executive Deferred Compensation and Buyout Plan
(or its predecessor), which is incorporated herein by reference as set
forth in Article 30.
7.3 Cessation of Disability. Notwithstanding the
provisions of Article 7.2, if prior to the end of the Disability
Period, the Executive's Total Disability shall have ceased under the
definition of Total Disability set forth in Article 7.4 and he shall
have commenced to perform his regular duties hereunder, the following
special provisions shall apply: (i) this Agreement shall continue in
full force and effect (except as otherwise provided in ARTICLE 3); and
(ii) the Executive shall be entitled to resume his employment under
this Agreement and to receive thereafter compensation in accordance
with ARTICLE 4 as though he had not been Totally Disabled; provided,
however, that unless the Executive shall perform his regular duties
hereunder for a continuous period of at least sixty (60) days following
a period of Total Disability before he again becomes Totally Disabled,
he shall not be entitled to start a new Disability Period, but instead
must continue under the remaining portion of the original Disability
Period. In this event, the resumption of the original Disability Period
shall commence on the date such Total Disability resumed.
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7.4 Definition of Total Disability. For purposes of this
Agreement, "Total Disability" shall mean the permanent and total
inability, by reason of physical or mental infirmity, or both, of the
Executive to perform his regular and customary duties with the Company
in a satisfactory manner. The determination of the existence or
nonexistence of Total Disability shall be made by the Board, pursuant
to a medical examination by a medical doctor licensed to practice
medicine in the state of the Executive's principal residence approved
by the Board.
ARTICLE 8. REIMBURSEMENT OF EXPENSES, OFFICE AND SECRETARIAL
ASSISTANCE. The Company recognizes that the Executive will incur, from time to
time, expenses for the benefit of the Company and in furtherance of the
Company's business, including, but not limited to, expenses for entertainment,
travel and other business expenses. The Executive shall be reimbursed for all
said expenses in accordance with the Company's policy and practice applicable
thereto. In the event of the termination of the Executive's employment for any
reason, the Company shall reimburse the Executive (or in the event of death, his
personal representative) for expenses incurred by the Executive on behalf of the
Company prior to the Termination Date to the extent such expenses have not been
previously reimbursed by the Company. Moreover, the Company agrees that, during
the Term of this Agreement, the Executive shall be provided, at the Company's
expense and under applicable policies of the Company, a fully furnished office
at the Company's Atlanta, Georgia headquarters, accompanying office, voice-mail,
e-mail, access, and other privileges, adequate secretarial and administrative
assistance, and all other similar privileges and/or rights (as may be requested
by the Executive), as are consistent with the Executive's position and duties
and as are customary to executives at the same level in companies of similar
size.
ARTICLE 9. OTHER EMPLOYEE BENEFITS. During the Term of this
Agreement, the Executive shall be entitled to participate in any and all
additional retirement, health, disability, life insurance, long-term disability
insurance, long-term incentive plans, nonqualified deferred compensation and
tax-qualified retirement plans or any other plans or benefits offered by the
Company to its senior executives generally, if and to the extent the Executive
is eligible to participate in accordance with the terms and provisions of any
such plan or benefit program. Notwithstanding the foregoing, all vesting periods
under all Xxxxxxx benefit plans shall be waived (except where waiving such
period would violate ERISA) and the Executive, upon termination of employment
for any reason before the age of retirement under those plans, shall be
considered to have attained the minimum retirement age provided in those plans.
Any and all such other employee benefits and/or plans are in addition
to (and not in lieu of or as a substitute for) any and all other rights and
benefits to which the Executive is entitled (or those in which the Executive is
otherwise vested or which the Executive has otherwise earned) under the terms of
this Agreement, the aforementioned Employment Agreement dated as of March 31,
1998 (which was subsequently amended effective November 1, 1999 and which has a
term through and including March 31, 2001), and/or the Amended and Restated
Executive Deferred Compensation and Buyout Plan (or its predecessor), which is
incorporated herein by reference as set forth in Article
Page 11 of 20
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30. Nothing in this ARTICLE 9 is intended, or shall be construed, to require the
Company to institute any particular plan, program or benefit.
ARTICLE 10. VACATION. During the Term of this Agreement, the
Executive shall be entitled to a minimum four (4) weeks of paid vacation during
each Employment Year.
ARTICLE 11. TERMINATION COMPENSATION.
11.1 Monthly Compensation. Upon the effective Termination
Date (whether by expiration of this Agreement or by termination of the
Executive's employment by either the Company or the Executive for any
reason), the Executive shall be entitled to continue to receive his
Base Salary through the last day of the month in which the Termination
Date occurs (the "Termination Month").
11.2 Compensation and Benefits Continuance.
(a) In addition to the compensation provided for
in Article 11.1, in the event (i) the Executive's employment is
terminated by the Executive for Good Reason or by the Company for any
reason other than For Cause or (ii) the Board declines to renew this
Employment Agreement with the Executive at the expiration of the Term
hereof and upon terms that are no less favorable to the Executive than
those contained in this Agreement, the Executive (or in the event of
his subsequent death, his designated beneficiary) shall receive an
amount equal to the sum of (1) and (2), where (1) equals three times
the Executive's then current Base Salary and (2) equals three times
that Target Bonus for the year in which the effective date of said
termination or expiration occurs, which Target Bonus cannot (pursuant
to Article 4.2) be less than 70% of the Executive's then Base Salary;
provided, however, that if the Executive terminates his employment for
Good Reason under Article 3.3(d) (due to a Change of Control), the
amount comprising (2) above shall equal three times that Total Bonus
amount of at least 140% of the Executive's Base Salary pursuant to
Article 4.2. Said amounts under this Article 11.2(a) shall be payable
in equal installments (and in accordance with the Company's ordinary
payroll practices) commencing on the first payroll period following the
last day of the Termination Month and continuing for a three (3) year
period ("Compensation Continuance Period") until the Company's
obligations to the Executive under this Article 11.2(a) are satisfied
and exhausted. During the Compensation Continuance Period, the
Executive shall continue to participate in all employee benefit plans
or programs of the Company (as described in ARTICLES 6, 8, and 9),
except where doing so would violate ERISA; provided, however, that
those Company Plan/health care benefits enumerated under Article 6.1
shall not be limited to said Compensation Continuance Period but shall
be provided in accordance with and for that period of time specified in
Article 6.1. In addition, pursuant to this Article 11.2(a) and Article
8, the Company shall provide to the Executive the office, office
privileges and rights, assistance, and all other rights as required by
said Article 8 during said Compensation Continuance Period.
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(b) In the event the Board has not declined to renew this
Employment Agreement with the Executive at the expiration of the Term
hereof (and upon terms that are no less favorable to the Executive than
those contained in this Agreement) but the Executive has nonetheless
declined to remain with the Company, the Executive (or in the event of
his subsequent death, his designated beneficiary) shall receive an
amount equal to the Executive's then current Base Salary. Said amounts
under this Article 11.2(b) shall be payable in equal installments (and
in accordance with the Company's ordinary payroll practices) commencing
on the first payroll period following March 31, 2006 and continuing for
a one (1) year period ("Abbreviated Compensation Continuance Period")
until the Company's obligations to the Executive under this Article
11.2(b) are satisfied and exhausted. During the Abbreviated
Compensation Continuance Period, the Executive agrees to provide to the
Company reasonable consulting/advising services as to its operations
and business in the event the Company requests such reasonable services
and the Executive is able to devote the appropriate and necessary time
and effort to provide such services. However, during the three (3) year
period following March 31, 2006, the Executive shall continue to
participate in all employee benefit plans or programs of the Company
(as described in ARTICLES 6, 8, and 9), except where doing so would
violate ERISA; provided, however, that those Company Plan/health care
benefits enumerated under Article 6.1 shall not be limited to said
Abbreviated Compensation Continuance Period but shall be provided in
accordance with and for that period of time specified in Article 6.1.
In addition, pursuant to this Article 11.2(a) and Article 8, the
Company shall provide to the Executive the office, office privileges
and rights, assistance, and all other rights as required by said
Article 8 during said Abbreviated Compensation Continuance Period.
(c) In addition to the compensation provided for in
Article 11.1, in the event the Executive terminates his employment via
resignation for any reason other than Good Reason, the Executive shall
receive all other compensation, benefits, and/or consideration to which
he was entitled or which was earned by or vested in the Executive
(whether under the terms of this Agreement, the aforementioned
Employment Agreement dated as of March 31, 1998 (which was subsequently
amended effective November 1, 1999 and which has a term through and
including March 31, 2001), and/or the Amended and Restated Executive
Deferred Compensation and Buyout Plan (or its predecessor), which is
incorporated herein by reference as set forth in Article 30) as of the
effective Termination Date, including but not limited to any and all
vested stock options under Article 5, any and all vested supplemental
Company Plan benefits as enumerated in Article 6.1, any and all vested
stock options/Rabbi Trust proceeds/other amounts and consideration as
enumerated in said Amended and Restated Executive Deferred Compensation
and Buyout Plan (or its predecessor). The provisions and rights of the
Executive enumerated in this Article 11.2(c) are also in addition to
all other rights to which the Executive is entitled under Article 3.4
of this Agreement.
(d) For purposes of this Article 11, the Executive shall
be entitled, but not required, to seek and obtain other employment or
work during any applicable period in
Page 13 of 20
15
which he may continue to receive compensation after said Termination
Date (including any applicable Compensation Continuance Period or
Abbreviated Compensation Continuance Period, as the case may be), and
no amounts or monies earned by the Executive in such other employment
or work during any said applicable period (including any applicable
Compensation Continuance Period or Abbreviated Compensation Continuance
Period, as the case may be) shall be used to setoff or otherwise reduce
the Company's payment obligations in this Article 11.
ARTICLE 12. RELOCATION UPON TERMINATION. If (a) the
Executive's employment is terminated by the Executive for any reason (whether or
not for Good Reason) or by the Company for any reason other than For Cause, (b)
the Board declines to renew this Employment Agreement with the Executive at the
expiration of the Term hereof and upon terms that are no less favorable to the
Executive than those contained in this Agreement, or (c) the Board has not
declined to renew this Employment Agreement with the Executive at the expiration
of the Term hereof (upon terms that are no less favorable to the Executive than
those contained in this Agreement) but the Executive has nonetheless declined to
remain with the Company, then the Company shall pay all relocation expenses,
including any necessary tax gross up, for any relocation of the Executive (and
his spouse) to any city or location in the United States, as may be selected in
the Executive's sole discretion. Provided, however, that the Company's
obligations under this Article 12 as to payment of said relocation expenses
shall be equal to [or more favorable (to the Executive) than] those under the
relocation program used in conjunction with the relocation of the Executive (and
other employees of the Company) to Atlanta, Georgia in 1999.
ARTICLE 13. POST-TERMINATION OBLIGATIONS. All payments and
benefits to the Executive under this Agreement shall be subject to the
Executive's compliance with the following provisions during the Term and
following the termination of the Executive's employment:
13.1 Assistance in Litigation. The Executive shall, upon
reasonable notice, furnish such information and assistance to the
Company as may reasonably be required by the Company in connection with
any litigation in which it is, or may become, a party, and which arises
out of facts and circumstances known to the Executive. The Company
shall promptly reimburse the Executive for any travel-related and all
other out-of-pocket expenses incurred in connection with the
fulfillment of his obligations under this Article 13.1.
13.2 Confidential Information. The Executive shall not
disclose or reveal to any unauthorized person any trade secret or other
confidential information relating to the Company, its subsidiaries or
affiliates, or to any businesses operated by them, and the Executive
confirms that such information constitutes the exclusive property of
the Company; provided, however, that the foregoing shall not prohibit
the Executive from disclosing such information to the extent necessary
or desirable in connection with obtaining financing for the Company (or
furnishing such information under any agreements, documents or
instruments under which such financing may have been obtained) or
otherwise disclosing
Page 14 of 20
16
such information to third parties or governmental agencies in
furtherance of the interests of the Company; or as may be required by
law.
13.3 Noncompetition. In the event (1) the Executive during
the Compensation Continuance Period or the Abbreviated Compensation
Continuance Period (as the case may be), without the prior written
consent of the Company, engages directly or indirectly, as a licensee,
owner, manager, consultant, officer, employee, director, investor or
otherwise, in any business in material competition with the Company and
(2) the Executive elects to continue to engage in any such activity
described in (1) above for thirty (30) days following delivery of
notice thereof by the Company to the Executive, then all rights
hereunder of the Executive and any person claiming under or through him
shall thereupon terminate as of said date thirty (30) days following
delivery of said notice, and no person shall be entitled thereafter to
receive any payments or benefits hereunder (except for the special
health care benefit under Article 6. 1 and all other benefits under
employee benefit plans or programs as provided in ARTICLES 3.4, 5, 6,
and 9 which have been earned or otherwise fixed or determined to be
payable prior to such termination). The Company and the Executive
acknowledge and agree that nothing in this Article 13.3 shall be
construed to prevent the Executive from engaging in any such activity
described in (1) above if the Executive so elects (thereby resulting in
termination of the Executive's rights as described above), that the
Executive shall not be deemed to have breached this Article or
Agreement solely by electing to engage in any such activity described
in (1) above, and that the Company may not seek to enjoin or otherwise
prevent the Executive from engaging in any such activity under this
Article or Agreement. This Article shall not apply to a passive
investment by the Executive constituting ownership of less than five
percent (5%) of the equity of any entity engaged in any business
described in this Article 13.3.
13.4 Failure to Comply. In the event that the Executive
shall fail to comply with any other provision of this Article 13.1 or
13.2, and such failure shall continue for thirty (30) days following
delivery of notice thereof by the Company to the Executive, all rights
hereunder of the Executive and any person claiming under or through him
shall thereupon terminate and no person shall be entitled thereafter to
receive any payments or benefits hereunder (except for benefits under
employee benefit plans or programs as provided in ARTICLES 3.4, 5, 6
and 9 which have been earned or otherwise fixed or determined to be
payable prior to such termination).
ARTICLE 14. ADDITIONAL PAYMENTS BY COMPANY. In the event that
any amount required to be paid or distributed to the Executive pursuant to this
Agreement shall constitute a parachute payment within the meaning of Section
280G of the Internal Revenue Code of 1986, as amended (the "Code"), and the
aggregate of such parachute payments and any other amounts otherwise required to
be paid or distributed to the Executive by the Company shall cause the Executive
to be subject to the excise tax on excess parachute payments under Section 4999
of the Code (the "Excise Tax"), or any successor or similar provision thereof,
the Company shall pay to the Executive an additional amount (the "Gross-Up
Payment") such that the net amount the
Page 15 of 20
17
Executive shall receive after the payment of any Excise Tax, shall equal the
amount which he would have received if the Excise Tax had not been imposed.
ARTICLE 15. PROFESSIONAL FEES. The Company shall be
responsible for paying all professional fees (including but not limited to
attorneys fees and related costs) incurred by the Executive in connection with
his employment with the Company in an amount not to exceed $100,000, without
approval of the Company; provided, however, that (1) any such fees charged on
behalf of the Executive in conjunction with or related to any negotiation of
this Agreement or any subsequent or related agreement(s) (or any amendment(s)
thereto) shall also be the responsibility of the Company but shall count against
said $100,000 amount and (2) any such professional fees of the Executive which
the Company would otherwise pay pursuant to its policies and practices as to
senior executives shall remain the responsibility of the Company but shall not
count against said $100,000 amount. Additionally, in the event that the
Executive incurs any professional fees (including but not limited to attorneys
fees and related costs) in protecting or enforcing his rights under this
Agreement or under any employee benefit plans or programs sponsored by the
Company in which the Executive is a participant, the Company shall reimburse the
Executive for such reasonable professional fees and for any other reasonable
expenses related thereto. Such reimbursement shall be made within thirty (30)
days following final resolution of the dispute or occurrence giving rise to such
fees and expenses.
ARTICLE 16. BENEFICIARY. The Executive shall name one or more
primary beneficiaries and one or more contingent beneficiaries, who shall be
entitled to receive any amounts payable following the death of the Executive
under ARTICLE 11, which beneficiary or beneficiaries shall be subject to change
from time to time by notice in writing to the Board. A beneficiary may be a
trust, an individual or the Executive's estate. If the Executive fails to
designate a beneficiary, primary or contingent, then and in such event, such
benefit shall be paid to the surviving spouse of the Executive or, if he shall
leave no surviving spouse, then to the Executive's estate. If a named
beneficiary entitled to receive any death benefit is not living or in existence
at the death of the Executive or dies prior to asserting a written claim for any
such death benefit, then and in any such event, such death benefit shall be paid
to the other primary beneficiary or beneficiaries named by the Executive who
shall then be living or in existence, if any, otherwise to the contingent
beneficiary or beneficiaries named by the Executive who shall then be living or
in existence, if any; but if there are no primary or contingent beneficiaries
then living or in existence, such benefit shall be paid to the surviving spouse
of the Executive or, if he shall leave no surviving spouse, then to the
Executive's estate. If a named beneficiary is receiving or is entitled to
receive payments of any such death benefit and dies before receiving all of the
payments due him, any remaining benefits shall be paid to the other primary
beneficiary or beneficiaries named by the Executive who shall then be living or
in existence, if any, otherwise to the contingent beneficiary or beneficiaries
named by the Executive who shall then be living or in existence, if any; but if
there are no primary or contingent beneficiaries then living or in existence,
the balance shall be paid to the estate of the beneficiary who was last
receiving the payments.
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ARTICLE 17. INDEMNIFICATION. The Company shall indemnify the
Executive during his employment and thereafter to the maximum extent permitted
by applicable law for any and all liability of the Executive arising out of, or
in connection with, his employment by the Company or membership on the Board;
provided, that in no event shall such indemnity of the Executive at any time
during the period of his employment by the Company be less than the maximum
indemnity provided by the Company at any time during such period to any other
officer or director under an indemnification insurance policy or the bylaws or
charter of the Company or by agreement.
ARTICLE 18. SOURCE OF PAYMENTS; NO TRUST. The obligations of
the Company to make payments hereunder shall constitute a liability of the
Company to the Executive. Such payments shall be from the general funds of the
Company, and the Company shall not be required to establish or maintain any
special or separate fund, except as specifically provided for in this Agreement,
or otherwise to segregate assets to assure that such payments shall be made, and
neither the Executive nor his designated beneficiary shall have any interest in
any particular asset of the Company by reason of its obligations hereunder.
Nothing contained in this Agreement shall create or be construed as creating a
trust of any kind or any other fiduciary relationship between the Company and
the Executive or any other person. To the extent that any person acquires a
right to receive payments from the Company hereunder, such right shall be no
greater than the right of an unsecured creditor of the Company.
ARTICLE 19. SEVERABILITY. All agreements and covenants
contained herein are severable, and in the event any of them shall be held to be
invalid by any competent court, this Agreement shall be interpreted as if such
invalid agreements or covenants were not contained herein.
ARTICLE 20. ASSIGNMENT PROHIBITED. This Agreement is personal
to each of the parties hereto, and neither party may assign nor delegate any of
his or its rights or obligations hereunder without first obtaining the written
consent of the other party; provided, however, that nothing in this ARTICLE 20
shall preclude (i) the Executive from designating a beneficiary to receive any
benefit payable under this Agreement upon his death or (ii) the executors,
administrators, or other legal representatives of the Executive or his estate
from assigning any rights under this Agreement to the person or persons entitled
thereto.
ARTICLE 21. NO ATTACHMENT. Except as otherwise provided in
this Agreement or required by applicable law, no right to receive payments under
this Agreement shall be subject to anticipation, commutation, alienation, sale,
assignment, encumbrance, charge, pledge or hypothecation or to execution,
attachment, levy, or similar process or assignment by operation of law, and any
attempt, voluntary or involuntary, to effect any such action shall be null, void
and of no effect.
ARTICLE 22. HEADINGS. The headings of articles, paragraphs
and sections herein are included solely for convenience of reference and shall
not control the meaning or interpretation of any of the provisions of this
Agreement.
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ARTICLE 23. GOVERNING LAW. The parties intend that this
Agreement and the performance hereunder and all suits and special proceedings
hereunder shall be construed in accordance with and under and pursuant to the
laws of the State of Georgia and that in any action, special proceeding or other
proceeding that may be brought arising out of, in connection with, or by reason
of this Agreement, the laws of the State of Georgia shall be applicable and
shall govern to the exclusion of the law of any other forum, without regard to
the jurisdiction in which any action or special proceeding may be instituted.
ARTICLE 24. BINDING EFFECT. This Agreement shall be binding
upon, and inure to the benefit of, the Executive and his heirs, executors,
administrators and legal representatives and the Company and its permitted
successors and assigns.
ARTICLE 25. COUNTERPARTS. This Agreement may be executed
simultaneously in one or more counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same instrument.
ARTICLE 26. NOTICES. All notices, requests and other communications to
any party under this Agreement shall be in writing (including telefacsimile
transmission or similar writing) and shall be given to such party at its address
or telefacsimile number set forth below or such other address or telefacsimile
number as such party may hereafter specify for the purpose by notice to the
other party:
(a) If to the Executive:
Xxxx X. Xxxx
0000 Xxxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
(b) If to the Company:
Xxxxxxx Corporation
0000 Xxxxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Each such notice, request or other communication shall be effective (i) if given
by mail, 72 hours after such communication is deposited in the mails with first
class postage prepaid, addressed as aforesaid or (ii) if given by any other
means, when delivered at the address specified in this ARTICLE 26.
ARTICLE 27. MODIFICATION OF AGREEMENT. No waiver or
modification of this Agreement or of any covenant, condition, or limitation
herein contained shall be valid unless in writing and duly executed by the party
to be charged therewith. No evidence of any waiver or
Page 18 of 20
20
modification shall be offered or received in evidence at any proceeding,
arbitration, or litigation between the parties hereto arising out of or
affecting this Agreement, or the rights or obligations of the parties hereunder,
unless such waiver or modification is in writing, duly executed as aforesaid.
The parties further agree that the provisions of this ARTICLE 27 may not be
waived except as herein set forth.
ARTICLE 28. TAXES. To the extent required by applicable law,
the Company shall deduct and withhold all necessary Social Security taxes and
all necessary federal and state withholding taxes and any other similar sums
required by law to be withheld from any payments made pursuant to the terms of
this Agreement.
ARTICLE 29. RECITALS. The Recitals to this Agreement are
incorporated herein and shall constitute an integral part of this Agreement.
ARTICLE 30. EFFECT OF PRIOR AGREEMENTS. This Agreement
(including the Amended and Restated Executive Deferred Compensation and Buyout
Plan effective as of the date hereof, which is attached hereto and incorporated
herein by reference) supersedes and replaces any prior employment agreement,
understanding or arrangement (whether written or oral) between the Company and
the Executive. Each of the parties hereto has relied on his or its own judgment
in entering into this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year
first above written.
EXECUTIVE
/s/ Xxxx X. Xxxx
---------------------------------------------
Xxxx X. Xxxx
WITNESS:
/s/ illegible
-------------------------
XXXXXXX CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------------
Signature of Appropriate Representative
XXXXXX X. XXXXXX
------------------------------------------
Printed Name of Appropriate Representative
Its SENIOR VP, CFO [Title]
-----------------------
Attest:
/s/ illegible
-------------------------
Secretary/Asst. Secretary
Page 20 of 20
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ATTACHMENT A
23
AMENDED AND RESTATED
EXECUTIVE DEFERRED COMPENSATION
AND BUYOUT PLAN
THIS AMENDED AND RESTATED EXECUTIVE DEFERRED COMPENSATION AND BUYOUT PLAN
(this "Agreement"), made and to become effective this 1st day of April, 2001
(the "Effective Date") by and between XXXXXXX CORPORATION (the "Company"), an
Alabama corporation with its principal office at Atlanta, Georgia, and XXXX X.
XXXX (the "Executive").
RECITALS:
WHEREAS, the Company and the Executive have executed an
Amended and Restated Employment Agreement dated as of the date of this
Agreement, incorporated herein and attached hereto as Appendix A (the
"Employment Agreement"). Pursuant to the terms of the Employment Agreement, the
Executive shall be employed by the Company for a term of five (5) years;
WHEREAS, when the Executive originally accepted employment
with the Company, the Executive lost certain benefits and opportunities under
his agreements with his previous employer, Xxxx Xxx Corporation ("Xxxx Xxx"),
and the Company and the Executive agreed that the Executive should be
compensated for such lost benefits and opportunities or that they be replaced
with comparable benefits and opportunities;
WHEREAS, the Executive and the Company entered into an
Executive Deferred Compensation Plan and Buyout Agreement, incorporated herein
and attached hereto as Appendix B (the "Prior Agreement"), for the purpose of
providing said compensation for lost benefits and opportunities; and
WHEREAS, the Executive and the Company desire to amend and
restate that Prior Agreement as set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and
obligations in this Agreement and said Employment Agreement and the compensation
that the Company agrees therein to pay the Executive, and of other good and
valuable consideration, the receipt of which is hereby acknowledged, the Company
and the Executive agree as follows:
ARTICLE I. RABBI TRUST.
1.1 Continued Maintenance. A Rabbi Trust, entitled the
"Xxxxxxx Corporation Non-Qualified Deferred Compensation Trust," shall
continue to be maintained for the benefit
24
of the Executive (the "Trust"). The Trust shall continue to be
irrevocable and contain the amounts contributed and deposited thereto
by the Company pursuant to the Prior Agreement in addition to any
interest or income generated by such amounts. The Trust shall continue
to at least earn interest at a variable rate (adjusted annually on the
anniversary of the Effective Date) equal to the Xxxxxxx Xxxxx Corporate
Bond Rate published in The Wall Street Journal.
1.2 Entitlement to Monetary Amount. Pursuant to this
Agreement and the Prior Agreement, the Executive is entitled to receive
(and the Company guarantees that it will distribute and pay to the
Executive) no less than that monetary amount (the "Monetary Amount")
equal to those amounts contributed and deposited to said Trust by the
Company under said Prior Agreement plus interest on such amounts, with
said interest accruing from March 31, 1998 through the date of
distribution and payment of said Monetary Amount and at a variable rate
(adjusted annually on the anniversary of the Effective Dates of said
Prior Agreement and this Agreement) equal to the Xxxxxxx Xxxxx
Corporate Bond Rate published in The Wall Street Journal.
1.3 Distribution/Payment Date. In the event of a Default
Termination (as defined in and pursuant to Article VI of said Prior
Agreement) on or before March 31, 2001, the Company shall distribute
and pay to the Executive that amount as determined in accordance with
Article VI of said Prior Agreement provided, however, that the
Executive shall have the right to elect to receive said distribution
and payment over a deferred or extended period of time (as requested
and specified by the Executive), whether by annuity or otherwise.
Effective April 1, 2001 and upon the earlier of (i) the date of any
subsequent termination of the Executive's employment for any reason
under the Employment Agreement and (ii) March 31, 2006, an amount equal
in value to the funds in the Trust as of the earlier of said dates
shall be distributed and paid by the Company to the Executive in a lump
sum, provided, however, that the Executive shall have the right to
elect to receive said distribution and payment over a deferred or
extended period of time (as requested and specified by the Executive),
whether by annuity or otherwise. Such distribution and payment to the
Executive is guaranteed by the Company, and the Company shall be
required to distribute and pay said amount from the funds of the Trust
or from other sources and/or accounts.
1.4 Discrepancy at Distribution Date. Upon distribution
and payment of said amount as set forth in Article 1.3 above, if said
amount is less than the aforementioned Monetary Amount, the Company
shall make and guarantee a supplementary distribution and payment to
the Executive in an amount equal to said shortfall/deficiency. Upon
distribution and payment of said amount as set forth in Article 1.3
above, if said amount is more than the aforementioned Monetary Amount,
said excess amount shall be deemed an additional contribution to the
Trust funds and shall be distributed and paid to the Executive in
accordance with this Article I.
2
25
ARTICLE II. STOCK OPTIONS AND DEPOSITED AMOUNTS.
2.1 Vested Stock Options. To compensate the Executive for
the lost opportunities as to certain Xxxx Xxx stock options (which
opportunities were lost as a result of accepting employment with the
Company), the Executive received, under said Prior Agreement and as of
March 31, 1998, grants of options to purchase: (1) 249,489 shares of
the Company's stock (pursuant to Article 2.1 of said Prior Agreement)
and (2) 32,577 shares of the Company's stock (pursuant to Article
2.2(b) of said Prior Agreement) (total options equal to 282,066). The
Executive was immediately and is currently vested in these stock
options, provided, however, that in the event of a Default Termination
(as defined in and pursuant to Article VI of said Prior Agreement) on
or before March 31, 2001, the vesting and/or forfeiture of said stock
options shall be determined in accordance with Article VI of said Prior
Agreement. Effective April 1, 2001, said stock options shall not be
subject to any divestiture or forfeiture pursuant to Article VI of said
Prior Agreement or otherwise. Said stock options shall be exercisable
by the Executive for a period of ten (10) years from March 31, 1998
(i.e. through March 31, 2008) at a price determined by taking the
average of the high and low price for the Company's common stock on the
Effective Date of said Prior Agreement as reported in the Wall Street
Journal. Attached hereto and incorporated herein by reference as
Appendix C is a list reflecting said vested stock options, applicable
price(s), and applicable grant and exercisability date(s).
2.2 Amounts Deposited and Contributed to Trust. To
compensate the Executive for certain opportunities and compensation
from Xxxx Xxx (which opportunities and compensation were lost as a
result of accepting employment with the Company), the Company was
obligated to contribute to the Trust (or to the Executive, as required
under said Prior Agreement) those principal amounts specified in
Articles 2.2(a), III, 5.1, 5.2, and 5.3 of said Prior Agreement. The
distribution and payment of the amount of the funds in the Trust shall
be in accordance with the provisions in Article 1.3 above.
2.3 The Company warrants and represents that, as of the
Effective Date, it has fully complied with all deposit, contribution,
grant, payment, consideration, and other obligations under all
applicable articles of said Prior Agreement, including any and all such
obligations of the Company as to Article 5.1 of said Prior Agreement
(regarding compensation by the Company to the Executive due to his
participation in Xxxx Xxx'x defined benefit retirement plans for
executives, including qualified plans and a Supplemental Executive
Retirement Plan ("SERP")) and Article 5.3 of said Prior Agreement
(regarding payment of compensation by the Company to the Executive for
the amount of incremental credit the Executive would have received
under his Employee Stock Ownership Plan at Xxxx Xxx if he had not
accepted employment with the Company). The Company thus warrants and
represents that no such obligations of the Company remain under said
Prior Agreement.
The Company also agrees that the Executive has fully complied
with all applicable obligations under said Prior Agreement, including
any and all excess payment obligations
3
26
of the Executive as to Article 5.1 of said Prior Agreement (regarding
compensation by the Company to the Executive due to his participation
in Xxxx Xxx'x defined benefit retirement plans for executives,
including qualified plans and a Supplemental Executive Retirement Plan
("SERP")).
Nothing in this Agreement is intended or shall be construed to
eliminate or waive any deposit, contribution, grant, payment,
consideration, and other obligation of the Company under all applicable
articles of said Prior Agreement. To the extent that any said deposit,
contribution, grant, payment, consideration, and other obligation of
the Company under said Prior Agreement remains and has not been
satisfied by the Company, the Company hereby agrees to comply with and
satisfy said obligation(s) on or before the Effective Date.
ARTICLE III. GENERAL PROVISIONS.
3.1 Governing Law. This Agreement shall be interpreted
under the laws of the State of Georgia.
3.2 Nonassignability. Benefits under this Agreement shall
not be subject to anticipation or assignment by any person entitled
thereto.
3.3 Binding Agreement. This Agreement shall be binding
and inure to the benefit of the Executive, his executors,
administrators, heirs and next of kin, and the Company, its successors
and assigns.
3.4 Merger or Consolidation. The Company shall not
consolidate or merge into or with another corporation or entity, or
transfer all or substantially all of its assets to another corporation,
partnership, trust or other entity unless such entity shall assume the
rights, obligations and liabilities of the Company under this Agreement
and said Prior Agreement and upon such assumption, shall become
obligated to perform the terms and conditions of this Agreement and
said Prior Agreement.
3.5 Waiver. No term or condition of this Agreement shall
be deemed to have been waived, nor shall there be any estoppel against
the enforcement of any provision of this Agreement, except by written
instrument of the party charged with such waiver, and any such waiver
shall operate only as to the specific term or condition waived and
shall not constitute a waiver of such term or condition for the future
or as to any act other than that specifically waived.
3.6 Amendment; Termination. This Agreement may not be
amended or terminated except by an instrument in writing signed by the
parties hereto.
3.7 Recitals. The recitals to this Agreement shall become
part of this Agreement.
3.8 Capitalized Terms. Any capitalized terms not
otherwise defined herein shall have the meanings given to them in the
Employment Agreement.
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IN WITNESS WHEREOF, this Agreement has been executed by and in
behalf of the parties hereto on the day and year first above written.
XXXXXXX CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
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Signature of Appropriate Representative
XXXXXX X.XXXXXX
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Printed Name of Appropriate Representative
Its: SENIOR VP, CFO [Title]
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/s/ Xxxx X. Xxxx
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XXXX X. XXXX
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EXHIBIT A
