EXHIBIT 10(aw)
AMENDMENT TO EMPLOYMENT AGREEMENT
This Amendment to Employment Agreement ("Amendment") is
entered into between Xxxxx Supermarkets, Inc. (the "Company"), and Xxxxxxx X.
Xxxxx (the "Executive").
RECITALS
A. The Company and the Executive entered into an Employment
Agreement dated August 3, 1999 (the "Employment Agreement").
B. Under the Employment Agreement, the Executive is entitled
to a "Salary Continuation Benefit" for five years upon employment termination
under certain circumstances (the "Salary Continuation Benefit").
C. In addition, to the extent the Salary Continuation Benefit
or any other compensation exposes the Executive to excise tax liability under
Sections 280G and 4999 of the Internal Revenue Code, the Employment Agreement
provides that the Company must pay additional amounts to the Executive to make
the Executive whole with respect to that excise tax liability (the "Gross Up
Obligation").
D. The Company has made available to the Executive a special
payout of the Executive's benefits under the Xxxxx Supermarkets, Inc. 1999
Senior Executive Supplemental Retirement Plan (the "SERP"), conditioned in part
upon the amendment of the Employment Agreement.
E. To prevent the Salary Continuation Benefit and the Gross Up
Obligation from impeding possible corporate transactions for the benefit of the
Company and its shareholders, and to provide for the special payout of the
Executive's SERP benefits, the Company and the Executive amend the Employment
Agreement as provided in this Amendment.
AMENDMENT
Effective December 30, 2005, the Employment Agreement is
amended as follows:
1. Section 7.1 of the Employment Agreement is amended to read
as follows:
7.1 TERMINATION DUE TO DEATH. If the Executive dies
during the Term, this Agreement shall terminate as of the date
of the Executive's death and the Executive's benefits shall be
determined in accordance with the survivor's benefits,
insurance and other applicable programs of the Company then in
effect. Within fifteen (15) days of the Executive's death, the
Company shall pay the Executive's designee or his estate (a)
that portion of his Base Salary which shall have been earned
through the termination date and (b) a bonus in an amount
determined by multiplying the bonus or other incentive or
conditional cash compensation received by the Executive with
respect to or during the Company's last completed fiscal year
by a fraction, the
numerator of which is the number of days elapsed in the
Company's current fiscal year through the termination date and
the denominator of which is 365. In addition, the Company
shall pay to the Executive's estate or his designee the Salary
Continuation Benefit (as defined in Section 8.7) for a period
equal to three (3) years from the termination date. If the
Executive is survived by his spouse, the Company shall also
provide the spouse with Lifetime Medical Benefits (as defined
in Section 8.4).
2. Section 7.2 of the Employment Agreement is amended to read
as follows:
7.2 TERMINATION DUE TO DISABILITY. If the Executive
suffers a Disability (as defined in Section 8.2) during the
Term, the Company shall have the right to terminate this
Agreement by giving the Executive Notice of Termination which
has attached to it a copy of the medical opinion that forms
the basis of the determination of Disability. The Executive's
employment shall terminate at the close of business on the
last day of the Notice Period (as defined in Section 8.6).
Upon the termination of this Agreement because of
Disability, the Company shall pay the Executive within fifteen
(15) business days of the termination date (a) that portion of
his Base Salary, at the rate then in effect as provided, which
shall have been earned through the termination date and (b) a
bonus in an amount determined by multiplying the bonus or
other incentive or conditional cash compensation received by
the Executive with respect to or during the Company's last
completed fiscal year by a fraction, the numerator of which is
the number of days elapsed in the Company's current fiscal
year through the termination date and the denominator of which
is 365. In addition, the Company shall pay to the Executive
the Salary Continuation Benefit for a period equal to three
(3) years from the termination date. The Company shall also
provide the Executive and his spouse with Lifetime Medical
Benefits. The Executive shall also be entitled to receive any
applicable disability insurance benefits resulting from any
insurance or other employee benefit programs of the Company.
3. Section 7.4 of the Employment Agreement is amended to read
as follows:
7.4 TERMINATION BY THE COMPANY WITHOUT "CAUSE" OR BY
THE EXECUTIVE FOR "GOOD REASON." At any time during the Term,
the Board of Directors of the Company may terminate this
Agreement without Cause by giving the Executive a Notice of
Termination, and the Executive's employment by the Company
shall terminate at the close of business on the last day of
the Notice Period.
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At any time during the Term, the Executive may
terminate this Agreement with "Good Reason" by giving the
Company a Notice of Termination which describes the actions,
events or beliefs that form the basis of the Executive's
action. The Executive's employment shall terminate at the
close of business on the last day of the Notice Period.
Within five (5) business days after such termination
date, the Company shall pay to the Executive (a) that portion
of his Base Salary which shall have been earned through the
termination date and (b) a bonus in an amount determined by
multiplying the bonus or other incentive or conditional cash
compensation received by the Executive with respect to or
during the Company's last completed fiscal year by a fraction,
the numerator of which is the number of days elapsed in the
Company's current fiscal year through the termination date and
the denominator of which is 365. The Company shall pay to the
Executive the Salary Continuation Benefit for a period equal
to three (3) years from the termination date. The Company
shall provide the Executive with life, medical, dental,
accident and disability insurance coverage for the period of
time that the Salary Continuation Benefit is in place at the
same coverage levels that are in effect as of the termination
date. In lieu of the foregoing insurance coverage benefits,
the Company may pay the Executive an amount equal to the
Executive's cost of obtaining comparable coverage. The Company
shall also provide the Executive and his spouse with Lifetime
Medical Benefits.
4. Section 9 of the Employment Agreement is amended to read as
follows:
9. EXCESS PARACHUTE PAYMENT PROVISIONS
9.1 COMPENSATION LIMITATION. Anything in this
Agreement to the contrary notwithstanding, no payment or
distribution by the Company to or for the benefit of the
Executive of the Salary Continuation Benefit or any other
amount in the nature of compensation (whether paid or payable
or distributed or distributable pursuant to the terms of this
Agreement or otherwise) (a "Payment") will be paid that would
be subject to the excise tax or denial of deduction imposed by
Sections 280G and 4999 of the Code (an "Excess Parachute
Payment").
9.2 ADJUSTMENT PROCEDURE. In the event that the
Company determines that any Payment would constitute an Excess
Parachute Payment, the Company will provide to the Executive,
within thirty (30) days after the Executive's employment
termination date, an opinion of a nationally recognized
certified public accounting firm mutually selected by
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the Company and the Executive (the "Accounting Firm") that the
Executive will be considered to have received Excess Parachute
Payments if the Executive were to receive the full amounts
described pursuant to this Agreement or otherwise and setting
forth with particularity the smallest amount by the which the
Payments would have to be reduced to avoid the imposition of
any excise tax or the denial of any deduction pursuant to Code
Sections 280G and 4999. The Payments shall be adjusted, in the
order of priority designated by the Executive in written
instructions, to the minimum extent necessary so that none of
the Payments, in the opinion of the Accounting Firm, would
constitute an Excess Parachute Payment. Any determination by
the Accounting Firm shall be binding upon the Company and the
Executive. All fees and expenses of the Accounting Firm shall
be borne by the Company.
5. Except to the extent altered by this Amendment, the terms
of the Employment Agreement shall remain effective.
IN WITNESS WHEREOF, the Company and the Executive have
executed this Amendment on the dates indicated below.
EXECUTIVE XXXXX SUPERMARKETS, INC.
/S/ XXXXXXX X. XXXXX By: /s/ XXXXXXX X. XXXXXXXXX
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Xxxxxxx X. Xxxxxxxxx
Senior Vice President, Chief
Financial Officer and Treasurer
Date: December 29, 2005 Date: December 29, 2005
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