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EXHIBIT (10l)
SEVERANCE AGREEMENT BETWEEN XXXX X. XXXXXXXXX
AND THE COMPANY DATED AS OF FEBRUARY 1, 1999
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AGREEMENT
This AGREEMENT is made and entered into as of the 25th day of
January, 1999, by and between XXXX X. XXXXXXXXX, an individual
("Employee"), and XXXXXXX CORPORATION, an Alabama corporation (the "Company").
W I T N E S S E T H:
WHEREAS, the Company is engaged in the design, manufacture and
marketing of athletic and leisure clothing and fabrics, with its principal
place of business located in Alexander City, Alabama; and
WHEREAS, Employee has been employed by the Company; and
WHEREAS, the Company and Employee desire to terminate their
relationship in an orderly fashion.
NOW, THEREFORE, in consideration of the terms, conditions, covenants
and premises herein contained, it is mutually agreed by and between Employee
and the Company as follows:
1. Resignation. Effective February 1, 1999, Employee resigns from active
employment by the Company, and the Company accepts Employee's
resignation.
2. Compensation. Commencing on February 28, 1999, and continuing through
July 31, 1999, Employee shall be paid severance compensation of
$22,083.33 per calendar month (the "Compensation"), to be paid at the
times and in the manner specified in the Company's general policies
regarding the payment of employment compensation as established from
time to time. In the event that Employee has not secured other
employment by July 31, 1999, the Company will extend the payment of
severance compensation on a month-to-month basis up to a maximum of
six (6) months (hereinafter referred to as "Conditional Severance
Pay"). In the event that Employee obtains other employment, no further
Conditional Severance Pay shall be due and payable to the Employee. In
no event shall Conditional Severance Pay be paid after the earlier of
the end of the month during which Employee obtains other employment or
January 31, 2000. The payments hereunder shall be in full satisfaction
of all amounts which may be due Employee under the Company's Salaried
Employees Severance Pay Plan and shall be inclusive of any amounts
payable as vacation pay or any other benefit. For federal, state and
local tax purposes, said compensation shall be treated as "wages" and
the Company shall withhold all appropriate taxes therefrom and shall
remit such taxes, together with the taxes imposed byss.3111 of the
Internal Revenue Code of 1986 on the Company, to the applicable taxing
authorities; provided that subject to the Company's obligation to
withhold and remit income tax on said compensation to the applicable
taxing
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authorities, Employee shall be responsible for and pay any additional
income tax due and owing thereon.
3. Cooperation. Employee shall, upon request by the Company, render such
information and assistance concerning Employee's former job
responsibilities as the Company may request. Such information and
assistance shall include, but not be limited to, information
concerning duties, responsibilities, files, projects, documents,
information, data, computer programs, filing dates, deadlines,
correspondence, relationships, parties, contracts, legal documents,
customers, price lists, product design and specifications,
organizational structure, research and development activities,
accounting information, equipment, agreements, claims, releases and
any additional information (the "Information") the Company deems
necessary, proper and relevant to the conduct of its business.
Employee agrees to provide the Information as part of this Agreement
and without additional compensation.
4. Medical Benefits. Until July 31, 1999, Employee shall, in the same
manner and at the same cost to him as would be applicable to employees
of the Company holding positions similar to the position which
Employee held on the date of his resignation, continue participation
and coverage for himself and, where applicable, his dependents under
the following employee and fringe benefit plans and policies of the
Company in which he participated at the time of his resignation, as,
and to the extent, such plans or policies may hereafter from time to
time be in effect:
Group Health Plan
In the event that Employee shall be entitled to receive Conditional
Severance Pay, the entitlement to participate in the above-referenced
employee and fringe benefit plans shall be extended for such time as
Employee shall be entitled to receive Conditional Severance Pay. In
the event that, prior to July 31, 1999, or during the period of
Conditional Severance Pay, Employee is employed by another entity
offering a group health insurance plan in which Employee may
participate or terms and conditions similar to other employees of such
employer, the Company shall have no further obligation under this
paragraph. In no event shall Employee be entitled to participate in
the Company's Group Health Plan after the earlier of Employee's
eligibility to participate in another entity's health insurance plan
or January 31, 2000. Employee shall be entitled to "COBRA continuation
coverage" under any group health plan in accordance with Section 601
et seq. of the Employee Retirement Income Security Act of 1974
("ERISA") on the terms and conditions provided herein for a period of
eighteen months from the date Employee's participation in the
Company's Group Health Plan ends.
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5. Pension Benefits.
(a) Employee shall be entitled to receive, and this Agreement
shall not affect, Employee's benefits payable under the
Company's Revised Pension Plan, 401(k) Retirement Savings
Plan and Supplemental Retirement Benefit Plan, if any, which
benefits shall be paid at the times and in the manner as
Employee has or may hereafter elect under the terms of said
plans.
(b) To the extent the provisions of this Agreement constitute an
"employee benefit plan" under ERISA, as amended, the claims
procedure for such "employee benefit plan" shall be the
claims procedure under the Company's Supplemental Executive
Retirement Plan.
6. Exercise of Stock Options. Effective upon Employee's resignation from
the active employment by the Company, all vested options granted by
the Company to Employee for the purchase of the Company's stock
pursuant to the Company's 1993 Executive Long-Term Incentive Plan (the
"1993 Plan"), or any predecessor stock option plan sponsored by the
Company shall remain exercisable at any time prior to the expiration
date or until July 31, 1999, whichever period is shorter, in the
manner specified in the 1993 Plan or predecessor stock option plan.
The Company acknowledges that Employee possesses the following options
to purchase shares of the Company's common stock:
Grant Date Shares Price
---------- ------ -----
December 31, 1991 5,800 29.00
July 28, 1993 2,800 27.50
January 26, 1994 3,300 27.4375
January 25, 1995 4,100 30.00
January 25, 1996 3,700 27.25
January 25, 1997 3,500 30.875
January 28, 1998 4,500 24.375
7. Covenant Not to Compete. Commencing upon the execution of this
Agreement and continuing through January 31, 2000, Employee shall not,
directly or indirectly, individually or as a partner, corporate
employee, member, stockholder (other than as a shareholder of less
than 1% of a company whose shares are listed on a national or regional
securities exchange or have been registered under Section 12(g) of the
Securities Exchange Act of 1934), officer, director, consultant or
advisor, work for or lend assistance to a competitor of the Company
engaged in manufacturing, marketing, selling or distributing
activewear, athletic uniforms, knit shirts, socks, uniform fabrics or
licensed sports apparel, or solicit any business from any customer of
the Company for or on behalf of any such competitor of the Company. It
is further agreed that due to the irreparable injury and damage to the
Company resulting from Employee's violation of this covenant, the
Company will be entitled to injunctive relief against
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the violation by Employee of this covenant in addition to all other
remedies otherwise available to the Company. If any court of competent
jurisdiction should hold that the restrictions contained in this
Section 7 are unreasonable, said restrictions shall be deemed to be
reduced, but only to the extent necessary, in the opinion of said
court, to make them reasonable.
8. Confidential Information. Employee agrees that all confidential
information that comes into his possession by reason of his employment
by the Company is the property of the Company. Employee shall not,
during the term of this Agreement or thereafter, disclose or
acknowledge the content of any confidential information to any person
other than an employee of the Company who is authorized to possess
such confidential information or Employee's advisors, such as
accountants or attorneys. For the purposes of this Section 8,
"Confidential Information" shall include all information relating to
the operations of the Company which has not been specifically
designated for release to the public by an authorized representative
of the Company, including, without limitation, trade secrets, plans,
pricing information, customer lists and other information developed by
or originated by the Company for its own use.
9. Offers to Personnel. Employee acknowledges that the employees of the
Company have been and will be trained at great expense by the Company,
and the Company has a compelling interest in maintaining its
contractual relationship and expectation of future contractual
relationship with its employees. In addition, if the employees of the
Company were to terminate their relationship with the Company and
render services to Employee, Employee would be unfairly benefitted
without adequate compensation to the Company, by the investment of the
Company. Accordingly, Employee covenants that he shall not from the
date hereof through January 31, 2000, directly or indirectly, impair
or initiate any attempt to impair the relationship or expectancy of a
continuing relationship which exists or will exist between the Company
and its employees or make offers or contracts of employment or offers
or contracts for services with such employees or with any partnership,
company or association through which such employees may render
services or employment to Employee.
10. Nondisclosure of Agreement. Employee shall not disclose or acknowledge
the existence of this Agreement or any terms or conditions contained
herein other than to Employee's advisors, such as accountants or
attorneys.
11. Notices. Any notice required or permitted to be given under this
Agreement shall be in writing and placed in the United States
Certified Mail, addressed to the party entitled to receive said
notice, at the following addresses:
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(a) If to Employee:
Xx. Xxxx X. Xxxxxxxxx
000 Xxxx 00xx Xxxxxx
Xxx. #00X
Xxx Xxxx, XX 00000
(b) If to the Company
Xxxxxxx X. Xxxxx
Xxxxxxx Corporation
000 Xxx Xxxxxx
P. O. Xxx 000
Xxxxxxxxx Xxxx, Xxxxxxx 00000-0000
or at such other address as may be specified from time to time in
notices given in accordance with the provisions of this Section 11.
12. Assignment. Neither this Agreement, nor the rights or obligations of
any party hereunder, may be assigned without the prior written consent
of the other party; provided that in the event the Company is merged
into another company or all or substantially all of the Company's
assets are transferred to another company, such other company shall
assume all of the obligations of the Company hereunder, and such
transaction shall not require the consent of Employee for the rights
of the Company hereunder to be assigned to such other company.
13. Waiver of Breach. The waiver by any party hereto of a breach of any
provision of this Agreement shall not operate or be construed as a
waiver of any subsequent breach by any party.
14. Section Headings. The headings of the sections of this Agreement are
solely for the purpose of convenience and are not a part hereof, and
shall not be used in the construction or interpretation of any
provision.
15. Modifications. This Agreement may not be changed or modified, nor may
any provision hereof be waived, except by an agreement in writing
executed by the party against whom enforcement of the change,
modification or waiver is asserted.
16. Succession. This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their heirs, personal
representatives, successors and assigns.
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17. Governing Law. To the extent not preempted by federal law, this
Agreement shall be construed and interpreted under, and the rights and
obligations of the parties hereunder shall be controlled and governed
by, the laws of the State of Alabama.
18. Execution of Release; Effect on Agreement. Concurrently with the
execution and delivery of this Agreement by the parties hereto, and in
consideration of the Company's delivery hereof, the Employee is
executing and delivering in favor of the Company a Release as to
certain matters. This Agreement shall not become effective until ten
days following the date of execution and delivery of said Release. In
the event of the revocation of said Release by the Employee in
accordance with the provisions thereof, this Agreement shall be null
and void and shall be of no further force and effect.
19. Severability. Should any court of competent jurisdiction decide, hold,
adjudge or decree that any provision, paragraph, clause or term of
this Agreement is void or unenforceable in whole or as applied in a
particular situation, such determination shall not effect any other
provision of this Agreement, and all other provisions of this
Agreement shall remain in full force and effect in such situation, and
all provisions of this Agreement shall remain in full force and effect
in any and all other situations.
IN WITNESS WHEREOF, Employee and the Company have executed, or caused
to be executed as of the date herein first above written.
EMPLOYEE
/s/ Xxxx X. Xxxxxxxxx
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Witness Xxxx X. Xxxxxxxxx
XXXXXXX CORPORATION
By /s/ Xxxx X. Xxxxx
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Its Senior VP Human Resources
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