Exhibit 10.16
AMENDMENT TO MEMORANDUM OF AGREEMENT
This Amendment (the "Amendment") by and between Friendly Ice Cream
Corporation ("Friendly's") and Xxxxxxxx X. Xxxxxxx ("Xx. Xxxxxxx"), as of
September 2, 2005 (the "Effective Date").
RECITALS
WHEREAS, Friendly's and Xx. Xxxxxxx entered into a Memorandum of
Agreement on or about May 31, 2005 (the "Memorandum Agreement") to memorialize
certain rights and obligations of the parties with respect to Xx. Xxxxxxx'x
xxxxxxxxx of employment from Friendly's as of May 31, 2005 (the "Separation
Date");
WHEREAS, Section 409A of the Internal Revenue Code enacted by Congress
in October 2004 and effective as of January 1, 2005 ("Section 409A") governs the
tax treatment of nonqualified deferred compensation agreements and certain
executive employment and severance agreements;
WHEREAS, the Department of Treasury and Internal Revenue Service issued
Notice 2005-1 (the "Notice") to provide guidance with respect to the application
of Section 409A to, inter alia, severance agreements;
WHEREAS, in accordance with the principles set forth in the Notice,
Friendly's and Xx. Xxxxxxx desire to amend the Memorandum Agreement as of the
Effective Date to ensure that the severance payments provided thereunder will
not be treated as nonqualified deferred compensation subject to Section 409A;
and
WHEREAS, Article VIII of the Memorandum Agreement provides that it may
be amended by Friendly's and Xx. Xxxxxxx.
NOW, THEREFORE, in consideration of the mutual covenants and promises
of the parties, the receipt and sufficiency of which is hereby acknowledged, the
parties hereby agree as follows.
1. Article I of the Memorandum Agreement shall be amended by striking
the text of the first paragraph and inserting the following text:
"Friendly's will continue to pay you semi-monthly from the
Separation Date until March 14, 2006 at your current base
rate of pay (plus executive match and automobile
allowance) ("SemiMonthly Payments"). On or before March
15, 2006, Friendly's will pay you a lump sum payment equal
to the semi-monthly pay you would have received between
March 15, 2006 and May 31, 2006, at your current base rate
of pay (plus executive match and automobile allowance)
("Lump Sum Payment"). Both the SemiMonthly Payments and
the Lump Sum Payment you receive will be subject to
appropriate statutory deductions and such other deductions
normally made for employees of Friendly's."
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2. Except as amended hereby, the Memorandum Agreement remains in full
force and effect and constitutes the entire agreement among the
parties regarding the subject matter thereunder.
IN WITNESS WHEREOF, the parties hereto have hereunto set their hands as
of the date above written.
By: /s/ X X Xxxxxxx
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Xxxxxxxx X. Xxxxxxx
Friendly Ice Cream Corporation
By: /s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
Vice President
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