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EXHIBIT 10.25
SEVERANCE AGREEMENT
THIS AGREEMENT between Xxxxxxx Fabrics, Inc., a Delaware corporation
(the "Corporation"), and Xxxxx X. Xxxxx whose address is 1612 Xxxx, Memphis,
Tennessee (the "Executive"), is dated as of December 10, 1996.
W I T N E S S E T H :
WHEREAS, the Corporation wishes to attract and retain well qualified
executive and key personnel and, in the event of any Change of Control (as
defined in Section 2) of the Corporation, to assure both itself and the
Executive of continuity of management; and
WHEREAS, no benefits shall be payable under this Agreement unless the
Effective Date shall occur and thereafter the Executive's employment is
terminated; and
WHEREAS, the employment of the Executive is "at will" and may be
terminated by the Corporation without payment of any benefits hereunder until
the occurrence of a Change of Control;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is hereby agreed by and between the Corporation and the
Executive as follows:
1. Operation of Agreement. No benefits shall be payable hereunder
unless a Change of Control (as defined in Section 2) occurs during the Change of
Control
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Period (as defined in Section 3). For the purposes of this Agreement the
date on which such a Change of Control occurs is referred to herein as the
"Effective Date."
2. Change of Control. For the purposes of this Agreement, a "Change of Control"
shall mean a change of control of a nature that would be required to be reported
by the Corporation in response to Item 1(a) of the Current Report on Form 8-K
(or its successor Item or Form, as the case may be), as in effect on the date
hereof (or from time to time thereafter), pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 0000 (xxx "Xxxxxxxx Xxx"); provided that, without
limitation, such a "Change of Control" shall be deemed to have occurred if: (i)
a third person, including a "group" as defined in Section 13(d)(3) of the
Exchange Act, becomes the beneficial owner, directly or indirectly, of 20% or
more of the combined voting power of the Corporation's outstanding voting
securities ordinarily having the right to vote for the election of directors of
the Corporation or (ii) individuals who constitute the Board of Directors of the
Corporation as of the date hereof (the "Incumbent Board") cease for any reason
to constitute at least two-thirds thereof, provided that any person becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Corporation's stockholders, was approved by a vote of at least
three-quarters of (or if less, all but one of) the directors comprising the
Incumbent Board (other than an election or nomination in connection with an
actual or threatened election contest relating to the election of directors of
the Corporation, as such terms are used in Rule 14a-11 of the Regulation 14A
promulgated under the
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Exchange Act) shall be, for purposes of this Agreement, considered as though
such person were a member of the Incumbent Board.
3. Change of Control Period. The "Change of Control Period" is the
period commencing on the date of this Agreement and ending on the earlier to
occur of (i) May 4, 1999 or (ii) the first day of the month coinciding with or
next following the Executive's 65th birthday. The expiration of the Change of
Control Period shall not limit the Corporation's obligation to provide, or the
Executive's right to collect, payments and benefits pursuant to Section 5
hereof.
4. Certain Definitions.
(a) Death or Disability. The Executive's employment shall terminate
automatically upon the Executive's death ("Death"). The Corporation will be
considered to have terminated the Executive's employment for Disability, if
after having established the Executive's Disability (as defined below), the
Executive receives written notice given in accordance with Section 9(b) of the
Corporation's intention to terminate his employment. The Executive's employment
will terminate for Disability Effective on the 90th day after receipt of such
notice if within such 90-day period after such receipt the Executive shall fail
to return to full-time performance of his duties (the "Disability Effective
Date"). For purposes of this Agreement, "Disability" means a disability that,
after the expiration of more than 180 days after its commencement, is determined
to be total and permanent by a physician selected by the Corporation or its
insurers; and acceptable to the Executive or his legal representative (such
agreement as to acceptability not to be withheld unreasonably).
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Consistent with, and not in limitation of, the provisions of Section 6
of this Agreement, neither a termination for, nor a determination of, Disability
pursuant to this Section 4(a) shall be deemed in and of itself a termination for
or determination of disability with respect to the Executive's eligibility to
receive long-term disability benefits, continued medical, dental, or life
insurance coverage, retirement benefits, or benefits under any other plan or
program provided by the Corporation or one of its affiliated companies and for
which the Executive may qualify.
(b) Cause. The Executive's employment will be terminated for Cause if
the majority of the Incumbent Board determines that Cause (as defined in this
Agreement) exists. For purposes of this Agreement, "Cause" means (i) an act or
acts of fraud or misappropriation on the Executive's part that result in or are
intended to result in his personal enrichment at the expense of the Corporation
or one of its affiliated companies or (ii) conviction of a felony.
(c) Good Reason. For purposes of this Agreement, "Good Reason"
means
(i) without the express written consent of the Executive, (A) the
assignment to the Executive of any duties inconsistent in any substantial
respect with the Executive's position, authority or responsibilities as in
effect during the 90-day period immediately preceding the Effective Date, or (B)
any other substantial adverse change in such position (including titles and
reporting requirement), authority or responsibilities;
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(ii) any failure by the Corporation to furnish the Executive
and/or, where applicable, his family with compensation (including annual bonus)
and benefits at a level equal to or exceeding those received (on an annual
basis) by the Executive from the Corporation during the 90-day period preceding
the Effective Date, including a failure by the Corporation to maintain the
Corporation's extra compensation plan ("Extra Compensation Plan") (including the
right to defer the receipt of payments thereunder) and the Corporation's
supplemental retirement benefit plan ("SERP"), other than an insubstantial and
inadvertent failure remedied by the Corporation promptly after receipt of notice
thereof given by the Executive;
(iii) the Corporation's requiring the Executive to be based or to
perform services at any office or location other than that at which the
Executive is primarily based during the 90-day period preceding the Effective
Date, except for travel reasonably required in the performance of the
Executive's responsibilities; or
(iv) any failure by the Corporation to obtain the assumption and
agreement to perform this Agreement by a successor as contemplated by Section
8(b).
For the purposes of this Section 4(c), any good faith determination of
"Good Reason" made by the Executive shall be conclusive.
(d) [Reserved].
(e) Notice of Termination. Any termination by the Corporation for
Cause or by the Executive for Good Reason shall be communicated by Notice of
Termination to the other party hereto given in accordance with Section 9(b). Any
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notice of termination by the Corporation for Disability shall be given in
accordance with Section 4(a). For purposes of this Agreement, a "Notice of
Termination" means a written notice that (i) indicates the specific termination
provision in this Agreement relied upon, (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) if the
termination date is other than the date of receipt of such notice, specifies the
termination date (which date shall not be more than 15 days after the giving of
such notice).
(f) Date of Termination. Date of Termination means the date of receipt
Of the Notice of Termination or any later date specified therein as the
termination date, as the case may be, or if the Executive's employment is
terminated by the Corporation for any reason other than Cause, Death or
Disability, the date on which the Corporation notifies the Executive of such
termination. Notwithstanding any contrary provision in this Section 4(f), if
that Executive's employment terminates due to Disability, the Date of
Termination shall be the Disability Effective Date.
5. Obligations of the Corporation Upon Termination.
(a) Good Reason Other Than For Cause, Death or Disability. Regardless
of whether the Change of Control Period has expired, if, within three years of
the Effective Date, (i) the Corporation shall terminate the Executive's
employment for any reason other than for Cause, Death or Disability, or (ii) the
Executive shall terminate his employment for Good Reason:
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1) the Corporation shall pay to the Executive in a lump sum in
cash within 20 days after the Date of Termination the aggregate of the amounts
determined pursuant to the following clauses (A) and (B):
(A) if not theretofore paid, the Executive's base salary
through the Date of Termination at the rate in effect at the time the Notice of
Termination was given; and
(B) the sum of (x) the Executive's annual base salary at the
rate in effect at the time the Notice of Termination was given, or if higher, at
the highest rate in effect at any time within the 90-day period preceding the
Effective Date and (y) an amount equal to the highest bonus paid or payable to
the Executive pursuant to the Extra Compensation Plan or any successor plan
thereto within five fiscal years prior to the Effective Date, provided, however,
that in no event shall the Executive be entitled to receive under this clause
(B) more than the product obtained by multiplying the amount determined as
hereinabove provided in this clause (B) by a fraction whose numerator shall be
the number of months (including fractions of a month) that at the Date of
Termination remain until the first day of the month coinciding with or next
following the Executive's 65th birthday and whose denominator shall equal twelve
(12); and
2) until the earlier to occur of (i) the date one year following
the Date of Termination, or (ii) the first day of the first month coinciding
with or next following the Executive's 65th birthday (the period of time from
the Date of Termination until the earlier of (i) or (ii) is hereinafter referred
to as the "Unexpired
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Period"), the Corporation shall continue to provide all benefits that the
Executive and/or his family is or would have been entitled to receive under all
medical, dental, vision, disability, executive life, group life, accidental
death and travel accident insurance plans and programs of the Corporation and
its affiliated companies, in each case on a basis providing the Executive and/or
his family with the opportunity to receive benefits at least equal to those
provided by the Corporation and its affiliated companies for the Executive under
such plans and programs if and as in effect at any time during the 90-day period
preceding the Effective Date.
3) Within 20 days after the Date of Termination the Corporation
shall pay to the Executive and/or his beneficiary, as the case may be, a lump
sum in cash in the amount of the present value of periodic payments equal to the
excess, if any, of the "Enhanced SERP Benefits" over the amount of benefits, if
any, the Executive and/or his beneficiary, as the case may be, has actually
received (or is then currently entitled to receive) from the SERP. For purposes
of this Section 5(a), the "Enhanced SERP Benefits" shall equal the amount of
benefits under the SERP the Executive and/or his beneficiary would have received
had the benefits under Section 4.1 of the SERP been determined by considering
the Executive (a) to have been employed for an additional Period of time equal
to the Unexpired Period; (b) to have been a member of the SERP for an additional
period of time equal to the Unexpired Period; (c) to have retired at the age he
would have attained at the end of the Unexpired Period; (d) to have had
compensation for such additional Plan Years (as such term is defined for
purposes of the SERP) equal to the Executive's earnings
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(including bonus under the Extra Compensation Plan) for the Plan Year prior to
the Effective Date; and (e) to be vested in a fraction (not to exceed 1) of his
benefit under the Xxxxxxx Fabrics, Inc. Consolidated Retirement Plan (the
"Retirement Plan") and the SERP equal to the quotient obtained by dividing (i)
the years of service for vesting purposes the Executive would have had under the
Retirement Plan if he had been employed for an additional period of time equal
to the Unexpired Period by (ii) the number of years of service for vesting
purposes that (as of the Date of Termination) are required before a participant
in the Retirement Plan is considered to be fully vested under the Retirement
Plan (the determination and payment of the amount payable under this paragraph
(III) to be pursuant to Section 11); and
4) for purposes of any written agreement between the Executive
and the Corporation relating to the payment of compensation to the Executive on
a deferred basis, the Executive shall be deemed to have remained in the
employment of the Corporation on a full-time basis until the Executive's 60th
birthday.
6. Non-exclusivity of Rights. Nothing in this Agreement shall prevent
or limit the Executive's continuing or future participation in any benefit,
bonus, incentive or other plan or program provided by the Corporation or any of
its affiliated companies and for which the Executive may qualify, nor shall
anything herein limit or otherwise affect such rights as the Executive may have
under any employment, stock option or other agreements with the Corporation or
any of its affiliated companies. Amounts that are vested benefits or that the
Executive is otherwise entitled to receive under any plan
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or program of the Corporation or any of its affiliated companies at or
subsequent to the Date of Termination shall be payable in accordance with such
plan or program.
7. Full Settlement. The payments provided for in this Agreement are in
full settlement of any claims the Executive may have against the Corporation
arising out of his termination, including, but not limited to, any claims for
wrongful discharge. The Corporation's obligation to make the payments provided
for in this Agreement and otherwise to perform its obligations hereunder shall
not be affected by any circumstances, including, without limitation, any setoff,
counterclaim, recoupment, defense or other right that the Corporation may have
against the Executive or others; provided, however, that the Corporation's
failure to make any such setoff shall not constitute a waiver of any claim of
the Corporation against the Executive. In no event shall the Executive be
obligated to seek other employment by way of mitigation of the amounts payable
to the Executive under any of the provisions of this Agreement. The Corporation
agrees to pay, to the full extent permitted by law, all legal fees and expenses
the Executive may reasonably incur as a result of any contest (regardless of the
outcome thereof) by the Corporation or others of the validity or enforceability
of, or liability under, any provision of this Agreement or any guarantee of
performance thereof, in each case plus interest, compounded monthly, on the
total unpaid amount determined to be payable under this Agreement, such interest
to be calculated on the basis of the prime commercial lending rate announced by
Xxxxxx Guaranty Trust Company of New York, in effect from time to time during
the period of such non-payment.
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8. Successors.
(a) This Agreement is personal to the Executive and without the prior
written consent of the Corporation shall not be assignable by the Executive
otherwise than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of and be enforceable by the Executive's legal
representatives, executors, heirs and legatees.
(b) This Agreement shall inure to the benefit of and be binding upon
the Corporation and its successors. The Corporation shall require any successor
to all or substantially all of the business and/or assets of the Corporation,
whether directly or indirectly, by purchase, merger, consolidation, acquisition
of stock, or otherwise, by an agreement in form and substance satisfactory to
the Executive, expressly to assume and agree to perform this Agreement in the
same manner and to the same extent as the Corporation would be required to
perform if no such succession had taken place.
9. Miscellaneous.
(a) The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect. This Agreement may not be amended or
modified otherwise than by a written agreement executed by the parties hereto or
their respective successors and legal representatives.
(b) All notices and other communications hereunder shall be in writing
and shall be given by hand delivery to the other party or by registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
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If to the Executive:
At the address first hereinabove written.
If to the Corporation:
Xxxxxxx Fabrics, Inc.
0000 X. Xxxx Xxxxxx
P.O. Box 2400
Tupelo, Mississippi 38003-2400
Attn: Corporate Secretary
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
(c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or unenforceability of any other
provision of this Agreement.
(d) The Corporation may withhold from any amounts payable under this
Agreement such federal, state or local taxes as shall be required to be withheld
pursuant to any applicable law or regulation, provided, however, that such
withholding shall be consistent with the calculations made by Accounting Firm
under Section 10 of the Agreement.
(e) This Agreement contains the entire understanding with the
Executive with respect to the subject matter hereof.
(f) Whenever used in this Agreement, the masculine gender shall include
the feminine or neuter wherever necessary or appropriate and vice versa and the
singular shall include the plural and vice versa.
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(g) The Executive and the Corporation acknowledge that the employment
of the Executive by the Corporation is "at will" and may be terminated by either
the Executive or the Corporation at any time and for any reason. Nothing
contained in the Agreement shall affect such rights to terminate, it being
agreed, however, that nothing in this Section 9(g) shall prevent the Executive
from receiving any amounts payable pursuant to Section 5(a), or 10 of this
Agreement in the event of a termination described in such Section 5(a), or 10 on
or after the Effective Date.
10. Penalty Taxes.
(a) Payment. In the event that the Accounting Firm determines that any
payment or other compensation or benefits made or provided to or for the benefit
of the Executive in any way connected with employment of the Executive by the
Corporation will be subject to tax pursuant to section 4999 of the Code or any
successor provision or any counterpart provision of state tax law (the "Penalty
Taxes"), the Corporation shall pay to the Executive within 20 days after the
Date of Termination an amount which, after deduction of all additional Federal,
state and local taxes (including, without limitation, income taxes and
additional Penalty Taxes) required to be paid by the Executive in respect of
receipt of such amount, shall be equal to the Penalty Taxes. In calculating the
income taxes required to be paid by the Executive, the Accounting Firm shall
assume that the Executive will pay tax at the maximum marginal Federal, state
and local rates and that the Executive will have no deductions or credits
available to reduce such taxes. In consideration of the payment of such amounts,
the Executive shall report and pay such taxes and promptly provide the
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Corporation with a written statement that such filing and payment have occurred
executed by the person or Firm that signed as income tax return preparer of the
Executive's federal income tax return, or if prepared by the Executive, executed
by the Executive.
(b) Indemnity. If the Executive shall be required to pay Penalty Taxes
in addition to those reimbursed pursuant to paragraph (a) above, or if based
upon failure to receive the opinion of Tax Counsel referred to in paragraph (d)
below the Executive reports and pays greater amounts of Penalty Taxes than are
reimbursed pursuant to paragraph (a) above (any such event hereafter being
referred to as a "Loss"), the Executive shall notify the Corporation and the
Corporation shall pay to the Executive as an indemnity an amount which, after
deduction of all income taxes and additional Federal, state and local taxes
(including, without limitation, income taxes and additional Penalty Taxes)
required to be paid by the Executive in respect of receipt of such amount
(assuming, for this purpose, that the Executive is subject to the maximum
marginal rates of taxation applicable to individuals at such time as such amount
becomes due and that the Executive will have no deductions or credits available
to reduce such taxes), shall be equal to the sum of (x) the Penalty Taxes
resulting in the Loss and (y) the net amount of any interest, penalties or
additions to tax payable to the United States Government or any state of local
government (after allowing for the deduction of such amounts, to the extent
properly deductible, for Federal, state or local income tax purposes) as a
result of such Loss. Each payment by the Corporation hereunder shall be made
within 30 days after receipt of a written demand therefor from
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the Executive accompanied by a written statement describing in reasonable detail
the Loss in question, the amount of additional tax, interest, penalties or
additions to tax and the calculation of the payment due in respect thereof;
provided that, if a contest of the Loss is being conducted pursuant to paragraph
(c) below, payment shall not be required by the Corporation until 30 days after
the completion or termination of such contest.
(c) Contest.
(1) The Executive shall notify the Corporation within 30 days of
receipt from the Internal Revenue Service of a revenue agent's report, a 30-day
letter or a notice of deficiency (as described in Section 6212 of the Code or
any successor provision) or of a similar written claim from a state taxing
authority, in which an adjustment is proposed to the federal or state taxes of
the Executive for which the Corporation would be required to indemnify the
Executive hereunder. If the Corporation (i) requests the Executive to do so
within 30 days after such notice, and (ii) furnishes the Executive an opinion of
recognized tax counsel selected by the Corporation and approved by the
Executive, which approval shall not unreasonably be withheld, (hereinafter "Tax
Counsel") to the effect that a reasonable basis exists for contesting such
proposed adjustment, the Executive shall contest the proposed adjustment in good
faith, shall keep the Corporation reasonably informed as to the progress of such
contest, and shall consider in good faith any suggestion made by the Corporation
as to the method of pursuing such contest; provided, however, that the Executive
shall not be obligated to contest such adjustment unless (i) the Corporation
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acknowledges in writing its liability under paragraph (b) above to indemnify the
Executive in the event that the Internal Revenue Service or a state taxing
authority prevails in its position regarding the proposed adjustment; (ii) the
Corporation shall have fully performed its prior obligations under this
Agreement; and (iii) the subject matter thereof shall not have been previously
decided pursuant to the contest provisions of this paragraph (c) with respect to
any other executive of the Corporation, unless the Corporation shall have
furnished an opinion of Tax Counsel to the Executive that more likely than not
the Executive will prevail in the contest; provided, further, that the Executive
shall determine, in his sole discretion, the nature of all action to be taken to
contest such proposed adjustment, including (x) whether any action to contest
such proposed adjustment initially shall be by way of judicial or administrative
proceedings, or both, (y) whether any such proposed adjustment shall be
contested by resisting payment thereof or by paying the same and seeking a
refund thereof, and (z) if the Executive shall undertake judicial action with
respect to such proposed adjustment, the court or other judicial body before
which such action shall be commenced. The Executive shall, if requested by the
Corporation within 30 days of an adverse determination by any court, and if Tax
Counsel is of the opinion that there is a reasonable basis for a successful
appeal of the matter in question, be obligated to appeal such adverse
determination:
(2) The Executive shall not be required to take any action pursuant to
this paragraph (c) unless and until the Corporation shall have agreed in writing
to indemnify the Executive in a manner reasonably satisfactory to the Executive
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for any fees, expenses, statutory or regulatory penalties, interest, additions
to tax, or other similar liabilities or losses which the Executive may incur as
a result of contesting the validity of any proposed adjustment and shall have
agreed to pay (or in the Executive's sole discretion to prepay) to the Executive
on demand all costs and expenses which the Executive may incur in connection
with contesting such proposed adjustment (including without limitation fees and
disbursements of counsel). If the Executive determines to contest any adjustment
by paying the additional tax and suing for a refund, the Corporation shall
timely advance to the Executive on an interest free basis an amount equal to the
sum of any tax, interest, penalties and additions to tax which are required to
be paid; provided, however, that, if the Executive is required to include in
income any amount with respect to such loan or the imputation of interest
thereon in any taxable year of the Executive prior to final determination of the
contest, then the Corporation, within 30 days of written notice thereof by the
Executive, shall pay to the Executive an amount which, after deduction of all
additional Federal, state and local taxes required to be paid by the Executive
in respect of the receipt of such amount (assuming, for this purpose, that the
Executive is subject to the maximum marginal rate of taxation applicable to
individuals at such times as such amount becomes due), shall be equal to the
aggregate additional federal and state income taxes payable by the Executive
with respect to such taxable year as a result of such inclusion. Upon receipt by
the Executive of a refund of any amounts paid by the Executive based on any
adjustment in respect of which amounts the Executive shall have been paid or
advanced an equivalent amount by the Corporation, the Executive
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shall pay to the Corporation the amount of such refund (which, in the case of
any contest in which a loan has been advanced pursuant to this paragraph, shall
be deemed to be in repayment of the loan advanced by the Corporation to the
extent fairly attributable thereto), but not in excess of the amount paid or
advanced by the Corporation, together with any interest received by the
Executive on such refund plus any net additional Federal, state or local tax
benefits actually realized by the Executive as the result of such payment, and
reduced by the amount of any Federal, state or local tax actually payable with
respect to receipt of such refund; provided, however, that the Executive may
offset the amount of such refund and benefits against any amount due and owing
by the Corporation to the Executive pursuant to this Agreement. Upon
disallowance of any such refund, the Corporation shall forgive the amount of the
advance fairly attributable thereto and shall pay to the Executive the amount of
its indemnity obligation hereunder, including such amount as, after deduction of
all taxes required to be paid by the Executive in respect of the receipt of such
amount under the laws of any Federal, state or local government or taxing
authority of the United States, shall be equal to the sum on an after-tax basis,
of any tax, interest, penalties or additions to tax payable with respect to the
forgiveness of such advance.
(3) If any adjustment referred to in this paragraph (c) shall be
proposed and the Corporation shall have requested the Executive to contest such
adjustment as above provided and shall have duly complied with the terms of this
paragraph (c), the Corporation's liability with respect to such adjustment shall
become fixed upon final determination of such adjustment; provided, however,
that if the
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Corporation shall not deliver the opinion of Tax Counsel provided in this
paragraph (c) to the effect that there is a reasonable basis for a contest or
appeal, then the Corporation's obligation to pay such indemnity shall become
immediately fixed.
(d) No Inconsistent Action. The Executive agrees that he will not take
any action, directly or indirectly, or file any returns or other documents
inconsistent with the assumption that the payments to which the indemnification
of paragraph (b) applies do not result in imposition of the tax under section
4999, and the Executive shall file such returns, take such actions, maintain
such records and execute such documents as may be reasonably requested by the
Corporation; provided, however, that the Executive's obligations hereunder to
file returns or other documents shall apply only if the Executive receives an
opinion of Tax Counsel at least 10 days prior to the due date of the return
(without regard to extensions) required to be made with respect to the
payments to which the indemnification of paragraph (b) applies that the
Executive will not be subject to the penalties described in sections 6651, 6653
or 6661 of the Code, or successor provisions then in effect, as a result of
taking such position.
(e) Disbursements. Any payments required to be made by the Corporation
pursuant to this Section 10 shall be made directly by the Corporation to the
Executive. Payments made by the Corporation or the Executive pursuant to this
Agreement shall be made by wire transfer of immediately available funds to such
bank and/or account in the continental United States as specified by the other
party in written directions to such payor party and mailed to such other party
by certified mail, postage prepaid.
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(f) No Setoff. No payment required to be made by the Corporation
pursuant to this Section 10 shall be subject to any right of setoff,
counterclaim, defense, abatement, suspension, deferment or reduction, and except
in accordance with the express terms hereof, the Corporation shall have no right
to terminate the Agreement or to be released, relieved or discharged from any
obligation or liability thereunder for any reason whatsoever.
(g) Late Payment, Interest. Any late payment by any party hereto of any
of its obligations under this Agreement shall bear interest to the extent
permitted by applicable laws, at a fluctuating rate per annum equal to the Prime
Rate as announced publicly by Citibank, N.A., in New York, New York from time to
time plus two percentage points, for the period such interest is payable.
(h) Accounting Firm. The Accounting Firm shall mean the Memphis,
Tennessee Main Office of Price Waterhouse & Co., or, at the election of the
Executive, the Memphis, Tennessee Main Office of such other national or regional
accounting Firm as the Executive shall select subject to the approval of the
Corporation, which approval shall not unreasonably be withheld.
11. Determination of Present Values Under Section 5. The determination
of present values for purposes of Paragraph (a)(III) of Section 5 of this
Agreement shall be in accordance with the following:
(a) Present values shall be determined as of the last day of the
calendar quarter ending most recently prior to the Termination Date ("Valuation
Date").
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(b) The interest rate and other actuarial assumptions used to determine
present values shall be the same as those which would be required to be used as
of the Valuation Date to determine the amount of a lump sum distribution under
the Retirement Plan.
(c) The determination of present values shall be made by Xxxxxx
Associates, or such other actuarial Firm as shall, at the time of the
determination, be the actuary for the Retirement Plan ("Actuary Firm"). The
Company shall provide to the Actuary Firm all information in its possession
reasonably requested by the Actuary Firm for the purpose of making such present
value determination.
(d) The payment of benefits under Paragraph (a)(III) of Section 5 shall
be made within the time limits set forth in such Paragraph based upon the
present value determinations made by the Actuarial Firm, and such determinations
shall be binding upon the Company and the Entitled Employee.
IN WITNESS WHEREOF, the Executive has hereunto set his hand and,
pursuant to the authorization of its Board of Directors, the Corporation has
caused these presents to be executed in its name on its behalf, and its
corporate seal to be hereunto affixed, all as of the day and year first above
written.
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Executive
XXXXXXX FABRICS, INC.
By
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