Exhibit - 10.58
EMPLOYMENT AGREEMENT
BETWEEN
GOODY'S FAMILY CLOTHING, INC.
AND
Xxxx X. Xxxxxx, III
TABLE OF CONTENTS
1. Definitions..............................................1
2. Employment...............................................3
3. Term.....................................................3
4. Position and Duties; Business Time.......................3
5. Compensation.............................................3
6. Termination of Employment................................5
7. Obligations of the Company Upon Termination..............6
8. Change of Control........................................8
9. Non-exclusivity of Rights................................8
10. Full Settlement..........................................8
11. Arbitration of Disputes..................................8
12. Confidential Information and Nonsolicitation.............9
13. Successors...............................................9
14. Miscellaneous...........................................10
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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, by and between GOODY'S FAMILY CLOTHING,
INC., a Tennessee corporation (the "Company"), and XXXX X. XXXXXX, III (the
"Executive"), shall be effective as of the 16th day of September, 1998.
RECITALS:
A. The Executive has for some time served as Senior Vice President,
Product Development of the Company. The Company and the Executive have entered
into an Employment Agreement dated August 7, 1994 (the "Existing Employment
Contract").
B. The Company wishes to assure the continued service of the Executive.
The Company desires to recognize the Executive's commitment to the Company and
to confirm the right of the Executive to certain employment, compensation and
severance benefits. To attain that end, the Company and the Executive wish to
enter into this Employment Agreement (the "Agreement").
NOW, THEREFORE, in consideration of the promises and mutual covenants
herein contained, and other good and valuable consideration, the Company and the
Executive do hereby agree as follows:
1. Definitions.
(a) "Accrued Obligations" shall mean (i) the Executive's Base
Salary through the Date of Termination, (ii) any amounts deferred by the
Executive and not yet paid by the Company pursuant to a valid election to defer
the receipt of all or a portion of such payments made in accordance with any
plan of deferred compensation sponsored by the Company and any earned but unpaid
vacation pay for the current year, (iii) any amounts or benefits owing to the
Executive or to the Executive's beneficiaries under the then applicable employee
benefit plans or policies of the Company and (iv) any amounts owing to the
Executive for reimbursement of expenses properly incurred by the Executive
through the Date of Termination and which are reimbursable in accordance with
the reimbursement policy of the Company described in Section 5(f).
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(b) "Base Salary" shall have the meaning set forth in Section
5(b).
(c) "Board" shall mean the Board of Directors of the Company.
(d) "Cause" shall mean that the Executive has, in the judgment
of a majority of the Board (i) committed a felony, or committed an act of fraud,
embezzlement or theft in connection with his duties with the Company or in the
course of his employment with the Company; (ii) willfully caused damage to
property of the Company; (iii) been convicted of a criminal offense (either a
misdemeanor involving acts of dishonesty, theft or moral turpitude, or a
felony); or (iv) engaged in a willful and material breach of his obligations
under Section 4 of this Agreement which breach (under this clause iv) has been
communicated to the Executive with specificity by written notice, and which has
not been cured to the reasonable satisfaction of the Board within a reasonable
period of time, which shall not be less than ten (10) days, nor more than thirty
(30) days, following receipt of such written notice by the Executive. The Board
shall provide the Executive with an opportunity to meet with the Board in order
to provide the Executive an opportunity to refute or explain acts or omissions
referred to in such written notice. For the purpose of this Section, no act or
omission shall be considered willful unless done or omitted to be done in bad
faith and without reasonable belief that such act or omission was done in the
best interest of the Company.
(e) A "Change of Control" of the Company shall mean and shall
be deemed to have occurred if (i) any person or group (within the meaning of
Rule 13d-3 of the rules and regulations promulgated under the Securities
Exchange Act of 1934, as amended (the "1934 Act Rules")), other than Xxxxxx X.
Xxxxxxxxxx, members of his immediate family, his affiliates, trusts or private
foundations established by or on his behalf, and the heirs, executors or
administrators of Xxxxxx X. Xxxxxxxxxx, shall acquire in one or a series of
transactions, whether through sale of stock or merger, more than 50% of the
outstanding voting securities of the Company or any successor entity of the
Company, (ii) all or substantially all of the Company's assets are sold or (iii)
the shareholders of the Company approve a complete liquidation or dissolution of
the Company.
(f) "Change of Control Date" shall mean (i) the closing date
on which a Change of Control shall have occurred, (ii) in the case of a sale of
all or substantially all of the Company's assets, the closing date on which a
Change of Control shall have occurred after shareholder approval is obtained, or
(iii) in the case of complete liquidation or dissolution of the Company, the
date on which shareholder approval is obtained.
(g) "Date of Termination" shall have the meaning set forth in
Section 6(e).
(h) "Disability" shall mean disability whereby the Executive
is unable to render the services provided for by this Agreement by reason of
illness, injury or incapacity (whether physical, mental, emotional or
psychological) for a period of either (i) ninety (90) consecutive days or (ii)
one hundred eighty (180) days in any consecutive three hundred sixty-five (365)
day period.
(i) "Incentive Bonus" shall have the meaning as set forth in
Section 5(c).
(j) "Incentive Plan" shall have the meaning as set forth in
Section 5(c).
(k) "Notice of Termination" shall have the meaning as set
forth in Section 6(d).
(l) "Qualified Plan" shall mean any retirement plan maintained
by the Company which is intended to meet the requirements of the Internal
Revenue Code of 1986, as amended.
(m) "Subsidiary" shall mean any majority-owned subsidiary of
the Company.
(n) "Supplemental Payment Date" shall have the same meaning as
set forth in Section 7(c).
2. Employment. The Company has employed the Executive, and the
Executive has agreed to continue to be employed by the Company, as Senior Vice
President, Product Development of the Company. The Executive has held the title
of Senior Vice President, Product Development of the Company since February 1,
1998.
3. Term. The Executive shall be considered an at-will employee
and his employment may be terminated by either party subject to the obligations
of the parties upon such termination as set forth in this Agreement.
4. Position and Duties; Business Time.
(a) Position and Duties. The Executive shall continue his
service as Senior Vice President, Product Development of the Company or another
position which shall be either of comparable rank or a promotion and shall
continue to have such responsibilities and duties as assigned to him by the
Chief Executive Officer of the Company, the Chief Operating Officer of the
Company or the Board from time to time.
(b) Business Time. The Executive agrees to devote his full
business time to the business and affairs of the Company and to use his best
efforts to perform faithfully and efficiently the responsibilities assigned to
him hereunder, to the extent necessary to discharge such responsibilities,
except for:
(i) time spent in managing his personal, financial and legal affairs and
serving on corporate, civic or charitable boards or committees, in each case
only if and to the extent not substantially interfering with the performance of
such responsibilities, and
(ii) periods of vacation to which he is entitled, periods of illness and
other absences beyond his control.
It is expressly understood and agreed that the continued service by the
Executive on any boards and committees on which he is serving or with which he
is otherwise associated immediately preceding the date hereof, or his service on
any other boards and committees shall not be deemed to interfere with the
performance of the Executive's services to the Company; provided, that in the
case of boards or committees on which the Executive is not currently serving the
Executive provides written notice of his intention to serve and the Board
thereafter approves such service (other than non-compensatory positions with
local boards or committees e.g. charitable, chamber of commerce or homeowner
associations which shall not require approval).
5. Compensation. The Executive shall be entitled to the
following compensation and benefits for as long as the Executive remains an
employee of the Company:
(a) Existing Employment Contract. The Executive and Company
acknowledge that all the terms of the existing employment contract (the
"Existing Employment Contract") are in full force and effect and there has not
been any breach of such Existing Employment Contract.
(b) Base Salary. The Executive shall receive a base salary
(the "Base Salary") payable in equal bi-weekly installments (or such other
installments as are provided by the Company for employees generally) at an
annual rate of $215,000.00. The Company shall review the Base Salary
periodically and in light of such review may, in its sole discretion, increase
(but not decrease) the Base Salary taking into account any change in the
Executive's responsibilities, increases in compensation of other executives with
comparable responsibilities, performance of the Executive and other pertinent
factors, and such adjusted Base Salary shall then constitute the "Base Salary"
for purposes of this Agreement.
(c) Short Term Incentive Plan Bonus. The Company has
established a "Short Term Incentive Plan" (the "Incentive Plan") under which the
Executive shall be eligible to participate for each fiscal year he holds the
position stated in Section 2 and shall be eligible to receive an annual
incentive target bonus of not less than 40% of Base Salary based on performance
and other specific objectives adopted by the Compensation Committee of the Board
(the "Incentive Bonus").
(d) Incentive and Savings Plans; Retirement and Death Benefit
Programs. The Executive shall be entitled to participate in all incentive and
savings plans and programs, including stock option plans and other equity-based
compensation plans, and in all employee retirement, executive retirement and
executive death benefit plans on a basis no less favorable than that basis
generally available to executives of the Company holding comparable positions or
having comparable responsibilities.
(e) Other Benefit Plans. The Executive, his spouse and their
eligible dependents (as defined in, and to the extent permitted by, the
applicable plan), as the case may be, shall be entitled to participate in or be
covered under all medical, dental, group disability, group life, severance,
accidental death and travel accident insurance plans and programs of the Company
to the extent such plans and programs are generally available to executives of
the Company holding comparable positions or having comparable responsibilities.
(f) Other Perquisites. The Executive shall also be
entitled to:
(i) prompt reimbursement for all reasonable expenses incurred by the
Executive in accordance with the policies and procedures of the Company;
(ii) three (3) weeks paid vacation, such paid
vacation time to be increased
(but not decreased) in accordance with Company policy;
(iii) an automobile at least comparable to the model currently furnished by
the Company shall be provided by the Company with expenses to be paid in
accordance with the Company's policies and procedures with respect thereto; and
(iv) an office or offices suitable for an executive officer with
secretarial and other assistance as shall reasonably be required by the
Executive.
6. Termination of Employment.
(a) Disability; Death. The Company may terminate the
Executive's employment after having established the Executive's Disability, by
giving to the Executive written notice of its intention to terminate his
employment, and his employment with the Company shall terminate effective on the
thirtieth (30th) day after receipt of such notice if the Executive shall fail to
return to full-time performance of his duties within thirty (30) days after such
receipt. If the Executive dies during the term of this Agreement, his employment
hereunder shall be deemed to cease as of the date of his death.
(b) Voluntary Termination by the Executive. Notwithstanding
anything in this Agreement to the contrary, the Executive may, upon not less
than thirty (30) days' written notice to the Company, voluntarily terminate
employment for any reason (including retirement under the terms of the Company's
retirement plan as in effect from time to time).
(c) Termination by the Company. The Company at any time may
terminate the Executive's employment for Cause or without Cause.
(d) Notice of Termination. Any termination by the Company for
Cause or by the Executive shall be communicated by a written Notice of
Termination to the other party hereto given in accordance with Section 14(c).
For purposes of this Agreement, a "Notice of Termination" means a written notice
given in the case of a termination for Cause which (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 be not more than thirty (30)
days after the receipt of such notice).
(e) Date of Termination. For the purpose of this Agreement,
the term "Date of Termination" means (i) in the case of a termination for which
a Notice of Termination is required, the date of receipt of such Notice of
Termination or, if later, the date specified therein, as the case may be, and
(ii) in all other cases, the actual date on which the Executive's employment
terminates.
7. Obligations of the Company Upon Termination. Upon
termination of the Executive's employment with the Company, the Company shall
have the following obligations:
(a) Death, Disability and Retirement. If the Executive's
employment is terminated by reason of the Executive's death, Disability, or
retirement on or after the attainment of age sixty-five (65), the Company shall
have no further obligations to the Executive's legal representatives under this
Agreement other than payment of the Accrued Obligations. If the Executive's
employment is terminated by reason of the Executive's death or Disability, the
Company shall have the additional obligation, subject to the terms of the
Incentive Plan and further provided that the Executive has been employed by the
Company for the first six (6) months of the then applicable fiscal year, to pay
a cash amount equal to a portion of the Incentive Bonus, the product of a
fraction, the numerator of which is the number of days elapsed since the date
the Incentive Plan began for the applicable fiscal year through the date of the
Disability or the date of death of the Executive, and the denominator of which
is the total number of days of the applicable fiscal year for such Incentive
Plan. Unless otherwise directed by the Executive (or, in the case of the
Incentive Plan or a Qualified Plan, as may be required by such Incentive Plan or
Qualified Plan) all Accrued Obligations shall be paid to the Executive, his
beneficiaries or his estate, as applicable, in a lump sum in cash within thirty
(30) days of the Date of Termination. In the event of the termination of the
Executive by reason of retirement on or after the attainment of age sixty-five
(65), death or Disability, he and/or his named beneficiaries, as the case may
be, shall be entitled to the benefits available through the Company sponsored
plans and programs designated for such category of termination on Schedule A.
With regard to the termination of the Executive's employment by reason of
retirement on or after the attainment of age sixty-five (65) or Disability, the
Company shall pay the premiums (to the same extent paid prior to the termination
of employment) for the continued participation of the Executive for a period of
six (6) months after the Date of Termination in any individual life insurance
policy on the same terms as the Executive and the Company were participating
prior to the Date of Termination. Further, with regard to the termination of the
Executive's employment by reason of the Executive's death, retirement on or
after the attainment of age sixty-five (65) or Disability, the Company shall,
for a period of six (6) months after the Executive's Date of Termination, pay
the entire COBRA premium under any Company medical and dental program that the
Executive (and his spouse and eligible dependents) was participating in prior to
the termination of employment. The Company's premium obligations in the
preceding two sentences shall exclude normal employee contributions paid by the
Executive prior to the Date of Termination. In addition to the foregoing, in the
event of termination of the Executive's employment by reason of the death or
Disability of the Executive, all unvested stock options held by the Executive
shall become fully vested, effective on the Date of Termination, and shall
thereafter be exercisable in accordance with the provisions of the applicable
Option Plan (including, without limitation, Sections 5 and 6 thereof) and Option
Agreement.
(b) Termination by the Company for Cause and Voluntary
Termination by the Executive. If the Executive's employment shall be terminated
for Cause or voluntarily terminated by the Executive the Company shall pay the
Executive the Accrued Obligations. The Executive shall be paid all such Accrued
Obligations in a lump sum in cash within thirty (30) days of the Date of
Termination and the Company shall have no further obligations to the Executive
under this Agreement, unless otherwise required by a Qualified Plan or specified
pursuant to a valid election to defer the receipt of all or a portion of such
payments made in accordance with any plan of deferred compensation sponsored by
the Company.
(c) Other Termination of Employment. If the Company terminates
the Executive's employment other than for Cause, death or Disability, the
Company shall pay and provide to the Executive the following:
(i) Severance Payment. The Company shall pay to the Executive in a lump sum
in cash or certified check within fifteen (15) days after the Date of
Termination a severance payment equal to the sum of the following amounts (other
than amounts payable from the Incentive Plan or Qualified Plans, non-qualified
retirement plans and deferred compensation plans, which amounts shall be paid in
accordance with the terms of such plans):
(A) all Accrued Obligations;
(B) a cash amount equal to six (6) months of
the Executive's Base Salary
at the rate in effect as of the date when the Notice of Termination was given;
(C) subject to the terms of the Incentive
Plan and further provided that
the Executive has been employed by the Company for the first six (6) months of
the then applicable fiscal year, a cash amount equal to a portion of the
Incentive Bonus, the product of a fraction, the numerator of which is the number
of days elapsed since the date the Incentive Plan began for the applicable
fiscal year through the date of such Termination or termination without Cause,
and the denominator of which is the total number of days of the applicable
fiscal year for such Incentive Plan.
In addition, if the Executive has not accepted employment from a subsequent
employer prior to the date which is seven (7) months from the Date of
Termination (the "Supplemental Payment Date"), commencing on the Supplemental
Payment Date the Company shall pay the Executive an amount equal to fifty
percent (50%) of his monthly Base Salary at the rate in effect as of the date
when the Notice of Termination was given in equal monthly installments until the
earlier of (i) the payment of the sixth (6th) monthly installment; or (ii) the
date of the Executive's acceptance of employment from a subsequent employer. The
Executive shall notify the Company immediately upon his acceptance of any such
new employment if secured prior to the payment by the Company of such six (6)
additional monthly installments.
(d) Release. As a condition precedent to the receipt of any
termination benefits payable to the Executive under this Section 7, the
Executive agrees to execute a general release among other things releasing the
Company from any obligation or liability (other than those contained in Sections
7, 8, 9, 10, 11, 13 and 14 hereof, to the extent an obligation under any such
section arose at or prior to the Date of Termination and remains unfulfilled).
Such release shall exclude the Executive's rights under any Qualified Plan.
(e) Discharge of Company's Obligations. Subject to the
performance of its obligations under Sections 7, 8, 9, 10, 11, 13 and 14 (and
then, only to the extent an obligation under any such section arose at or prior
to the Date of Termination and remains unfulfilled), the Company shall have no
further obligations to the Executive under this Agreement in respect of any
termination of employment.
8. Change of Control. Upon the occurrence of a Change of
Control, the Company shall pay the Executive, as consideration for assisting the
Company in bringing about a successful transaction, an amount equal to twelve
(12) months of the Executive's Base Salary at the rate in effect as of the
Change of Control Date. Such amount shall be payable in a lump sum in cash or
certified check within five (5) days after the Change of Control Date.
9. 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 Company and
for which the Executive may qualify, nor shall anything herein limit or
otherwise prejudice such rights as the Executive may have under any other
agreements with the Company, including, but not limited to stock option
agreements. Amounts which are vested benefits or which the Executive is
otherwise entitled to receive under any plan or program of the Company at or
subsequent to the Date of Termination shall be payable in accordance with such
plan or program.
10. Full Settlement. The Executive shall not 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.
11. Arbitration of Disputes. In the event that a claim for
payment or benefits under this Agreement is disputed, the Company and the
Executive agree to submit such dispute to final and binding arbitration with
United States Arbitration and Mediation, Inc. ("USAM") in Knoxville, Tennessee
or such other arbitration firm as the Company and the Executive shall mutually
agree. Either party wishing to arbitrate any claim hereunder shall notify the
other party and USAM in writing whereupon USAM shall select a neutral arbitrator
and shall schedule an arbitration hearing within thirty (30) days of receipt of
such notice of arbitration. The arbitration shall be conducted in accordance
with the rules and procedures of USAM. The parties agree that any arbitrator's
award may be presented to a court of competent jurisdiction and judgment entered
thereon.
12. Confidential Information and Nonsolicitation.
(a) The Executive shall hold in a fiduciary capacity for the
benefit of the Company all secret or confidential information, knowledge or
data, including without limitation all trade secrets, relating to the Company,
and its business, (i) obtained by the Executive during his employment by the
Company, and (ii) which is not otherwise publicly known (other than by reason of
an unauthorized act by the Executive) and is subject to efforts that are
reasonable under the circumstances to maintain its secrecy. After termination of
the Executive's employment with the Company, the Executive shall not, without
the prior written consent of the Company, unless compelled pursuant to an order
of a court or other body having jurisdiction over such matter, communicate or
divulge any such information, knowledge or data to anyone other than the Company
and those designated by it.
(b) Upon termination of the Executive's employment for any
reason, the Executive, for the twelve (12) month period following the Notice of
Termination, shall not, on his own behalf or on behalf of any person or entity,
directly or indirectly solicit or aid in the solicitation of any employees of
the Company to leave their employment. In the event the Executive violates the
terms of Section 12(a) or this Section 12(b), the Employee shall forfeit the
right to all salary and benefits that the Executive and/or his family members
were otherwise entitled pursuant to the terms of Section 7. Also, in the event
that this Section 12 is determined to be unenforceable in part, it shall be
construed to be enforceable to the maximum extent permitted by law.
(c) The Executive agrees that the covenants of confidentiality
and non-solicitation contained in this Section 12 are reasonable covenants under
the circumstances and necessary to protect the business interests and properties
of the Company. The Executive agrees that irreparable loss and damage will be
suffered by the Company should the Executive breach any of the covenants
contained in this Section 12. Accordingly, the Executive agrees that the
Company, in addition to all remedies provided at law or in equity, shall be
entitled to a temporary restraining order and temporary and permanent
injunctions to prevent a breach or contemplated breach of any of the covenants
contained in this Section 12.
13. Successors.
(a) This Agreement is personal to the Executive and, without
the prior written consent of the Company, 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.
(b) This Agreement shall inure to the benefit of and be
binding upon the Company and its successors. The Company shall require any
successor to all or substantially all of the business and/or assets of the
Company, whether direct or indirect, by purchase, merger, consolidation,
acquisition of stock, or otherwise, expressly to assume and agree to perform
this Agreement in the same manner and to the same extent as the Company would be
required to perform if no such succession had taken place.
14 Miscellaneous.
(a) Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Tennessee, applied without
reference to principles of conflict of laws.
(b) Amendments. 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.
(c) Notices. All notices and other communications hereunder
shall be in writing and shall be given by hand delivery to the other party, by
overnight delivery or by registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:
If to the Executive: at the address listed on the last
page hereof
If to the Company: Goody's Family Clothing, Inc.
000 Xxxxx'x Xxxx
X.X. Xxx 00000
Xxxxxxxxx, Xxxxxxxxx 00000-0000
Attention: General Counsel
(with a copy to the attention of the Secretary or to such other address as
either party shall have furnished to the other in writing in accordance
herewith). Communications delivered by hand or by overnight delivery shall be
deemed received on the date of delivery and communications sent by registered or
certified mail shall be deemed received three (3) business days after the
sending thereof.
(d) Tax Withholding. The Company 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.
(e) Severability. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement.
(f) Captions. The captions of this Agreement are not part of
the provisions hereof and shall have no force or effect.
(g) Entire Agreement. This Agreement expresses the entire
understanding and agreement of the parties regarding the terms and conditions
governing the Executive's employment with the Company, and all prior agreements
governing the Executive's employment with the Company (including, without
limitation, the Existing Employment Contract) shall have no further effect;
provided, however, that except as specifically provided herein, the terms of
this Agreement do not supersede the terms of any grant or award to the Executive
under any stock option or profit sharing program of the Company except as
specifically set forth in Section 7(a) with respect to the vesting and
exercisability of stock options.
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IN WITNESS WHEREOF, the Executive has hereunto set his hand
and the Company has caused this Agreement to be executed in its name on its
behalf, and its corporate seal to be hereunto affixed and attested by its
Secretary, all effective as of the day and year first above written.
GOODY'S FAMILY CLOTHING, INC.
By: /s/ Xxxxx X. Call
Xxxxx X. Call
Title: President and Chief Operating Officer
ATTEST:
_____/s/ Xxxxx X. Xxxxxxxx ____________
Xxxxx X. Xxxxxxxx
Title:_Assistant Secretary___________
(CORPORATE SEAL)
EXECUTIVE: Xxxx X. Xxxxxx, III
/s/ Xxxx X. Xxxxxx, III
Name: Xxxx X. Xxxxxx, III
Address:
SCHEDULE A - XXXX XXXXXX
The following is a summary list of benefits available to the Executive
upon termination of the Executive's employment by reason of retirement on or
after the attainment of age sixty-five (65), death or Disability through Company
sponsored plans and programs as of the date of this Agreement. Nothing herein
shall preclude the Company from amending, altering, suspending, discontinuing or
terminating any of such plans and programs in compliance with applicable law and
regulation.
COVERAGE TYPE ......... BENEFIT AMOUNT
Group Life Insurance....... -- Basic $215,000
......... High Option $215,000
Group Disability Insurance.-- Basic 2 year $5,000
......... High Option $5,000
......... (benefit for 5 years)
Coverage by group life and disability insurance policies terminates upon
termination of the Executive's employment for any reason, except death (in the
case of life insurance) and disability (in the case of disability insurance).
The Executive's beneficiaries are entitled to benefits under the group life
insurance policy if the Executive dies during the period he is receiving
disability payments as a result of such disability.
In addition, the Company has a 401(k) plan in which the Executive may
participate on a voluntary basis. Company contributions therein on his behalf
vest in accordance with the terms of the 401(k) plan, which provides that such
contributions become immediately vested in the event of death during the term of
employment. Upon termination for any reason, the Executive must withdraw his
vested funds by the end of the following fiscal quarter.
