SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q/A
AMENDMENT NO. 1
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
for the quarterly period ended March 31, 1996
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
for the transition period from to
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Commission file number 1-8930
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H. F. Ahmanson & Company
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(Exact name of registrant as specified in charter)
Delaware 95-0479700
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
4900 Rivergrade Road, Irwindale, California 91706
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (818) 960-6311
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Not applicable
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(Former name or former address, if changed since last report)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes x No
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Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of the latest practicable date: As of March 31,
1996, common stock, $.01 par value, outstanding, 112,512,418 shares.
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EXPLANATORY NOTE
This amendment to Form 10-Q on Form 10-Q/A has been prepared to
include certain exhibits which were previously omitted. No part of the
Form 10-Q as previously filed, other than Part II, Other Information, Item
6(a), Exhibits, is affected by this amendment.
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PART II. OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K.
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(a) Exhibits.
10.1 Form of Employment Agreement between H. F. Ahmanson & Company
and certain officers.
10.2 Executive officers with whom H. F. Ahmanson & Company has
entered into an employment agreement.
11 Statement of Computation of Earnings per share (previously
filed as Exhibit 11 to Form 10-Q for quarter ended March 31,
1996).
27 Financial Data Schedule (Previously filed with the SEC by
EDGAR as Exhibit 27 to Form 10-Q for quarter ended March 31,
1996).
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
Date: May 15, 1996
H. F. AHMANSON & COMPANY
/s/ Tim S. Glassett
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By: Tim S. Glassett
First Vice President and
Assistant General Counsel
/s/ George Miranda
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By: George Miranda
First Vice President and
Principal Accounting Officer
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EXHIBIT INDEX
EXHIBIT SEQUENTIALLY
NO. DESCRIPTION NUMBERED PAGE
- ------- ----------- -------------
10.1 Form of Employment Agreement between H. F.
Ahmanson & Company and certain officers.
10.2 Executive officers with whom H. F. Ahmanson &
Company has entered into an employment
agreement.
11 Statement of Computation of Earnings per share
(previously filed as Exhibit 11 to Form 10-Q
for quarter ended March 31, 1996).
27 Financial Data Schedule (Previously filed with the
SEC by EDGAR as Exhibit 27 to Form 10-Q for
quarter ended March 31, 1996).
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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is entered into as of
__________ by and between H. F. Ahmanson & Company, a Delaware
corporation ("Employer"), and __________ ("Executive").
WITNESSETH:
[WHEREAS, Executive and Employer have entered into an
Amended and Restated Employment Agreement dated as of __________,
(the "Prior Agreement"); and]
WHEREAS, Employer desires to obtain the benefit of
[continued] services by Executive, and Executive desires to
[continue to] render services to the Employer; and
WHEREAS, [the Compensation Committee of] the Board of
Directors of the Employer (the "Board") has determined that it is
in the Employer's best interest and that of its stockholders to
recognize the substantial contribution that Executive [has made
and] is expected to [continue to] make to the Employer's business
and to retain his services in the future; [and
WHEREAS, the Employer and Executive desire to terminate
and supersede the Prior Agreement and to set forth in this
Agreement the terms and conditions of Executive's continued
employment with the Employer;]
NOW, THEREFORE, in consideration of the mutual promises
contained herein, the Employer and Executive agree as follows:
1. EMPLOYMENT. The Employer agrees that Executive
will be employed by the Employer or by one or more of the
Employer's subsidiary corporations to render the services
specified herein upon the terms and conditions and for the
compensation herein provided, and Executive agrees to be so
employed and to render the services as specified. All
compensation paid to Executive by the Employer or any subsidiary
of the Employer, and all benefits and perquisites received by
Executive from the Employer or any of its subsidiaries, will be
aggregated in determining whether Executive has received the
compensation and benefits provided for herein.
2. TERM OF EMPLOYMENT.
(a) End of Term. The term of the employment of
Executive hereunder will be for the period commencing on the date
of this Agreement and ending on the earliest of:
(i) __________ months after notice of
termination is given by the Employer to Executive;
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(ii) the date of termination of Executive's
employment by Executive at his election and without "Good Reason"
(as defined in Section 8 hereof), it being understood that
Executive shall not be liable for damages or breach of contract
on account of any such termination by Executive pursuant to this
clause (ii);
(iii) the date of termination of Executive's
employment by the Employer for "Cause" (as defined in Section 7
hereof) or by the Employer without Cause in accordance with
Section 8 or by Executive for Good Reason pursuant to Section 8
(including any termination authorized by Section 9(c));
(iv) the earlier of Executive's sixty fifth
(65th) birthday or the date of Executive's voluntary retirement
in accordance with the Employer's plans and policies;
(v) the date of Executive's death; or
(vi) the Disability Effective Date (as that
term is defined in Section 5 hereof) following Executive's
Disability (as that term is defined in Section 5 hereof).
It is understood that at each and every moment of time the
remaining term of employment hereunder shall be __________ years,
unless earlier terminated in accordance with the provisions of
this Section 2.
(b) Date of Termination. As used herein the term
"Date of Termination" means (i) if Executive's employment is
terminated by the Employer pursuant to clause (i) of Section 2(a)
hereof, the date that is __________ months after the date of
Executive's receipt of the notice of termination or any later
date specified therein, as the case may be, (ii) if Executive
terminates his employment at his election and without Good Reason
pursuant to clause (ii) of Section 2(a), the date of the
Employer's receipt of the notice of termination from Executive or
any later date specified therein, as the case may be, (iii) if
Executive's employment is terminated by the Employer for Cause or
by the Employer without Cause pursuant to Section 8, or by
Executive for Good Reason, fifteen (15) days after the date of
receipt of the notice of termination by Executive or the
Employer, respectively, or any later date specified therein, as
the case may be, (iv) if Executive's employment terminates by
reason of Executive's voluntary retirement, the date that such
retirement becomes effective in accordance with the Employer's
plans and policies; and (v) if Executive's employment is
terminated by reason of death or Disability, the date of death of
Executive or the Disability Effective Date (as that term is
defined in Section 5 hereof).
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3. SERVICES TO BE RENDERED; EXCLUSIVITY.
(a) Service and Location. The services to be
rendered by Executive hereunder are set forth in Schedule I
attached hereto and by this reference incorporated herein, which
includes a description and, if applicable, a title of Executive's
position or positions with the Employer and/or its subsidiaries
under this Agreement and which specifies his reporting
responsibilities. During the term of Executive's employment
under this Agreement, the Employer shall not assign to Executive
any duties or responsibilities that are inconsistent with his
position, duties, responsibilities or status specified in
Schedule I hereto, or adversely change (from Executive's
perspective) Executive's reporting responsibilities, position or
title specified in Schedule I or take any other action which
results in a material diminution in such position, authority,
duties or responsibilities. Executive shall perform such
services at the Employer's principal executive offices in
Irwindale, California or in such other place in reasonable
proximity to Irwindale, California to which the Employer's
principal executive offices may be relocated; provided, however,
that Executive agrees to perform a reasonable amount of services
on behalf of the Employer outside of the Los Angeles area (which
amount may not exceed, at any time during the __________ months
following a Change in Control (as hereinafter defined in Section
9(b)), fifteen (15) calendar days in any calendar quarter); and
provided, further, that during the __________ months following a
Change in Control the Employer shall not be entitled to relocate
its principal executive offices to a site that is more than
thirty (30) miles from Irwindale, California without regard to
whether such site would be considered to be within reasonable
proximity of Irwindale, California.
(b) Full Time Efforts. During the term of this
Agreement and excluding any periods of vacation, family or sick
leave or holidays to which Executive is entitled, Executive shall
devote his full business time and energy to the business, affairs
and interests of the Employer and its subsidiaries, and matters
related thereto, and shall use his reasonable best efforts and
ability to promote the interests of the Employer and its
subsidiaries. Executive agrees that he will diligently endeavor
to promote the business, affairs and interests of the Employer
and its subsidiaries and perform services contemplated hereby in
accordance with the policies established by the Board from time
to time. Executive agrees to serve without additional
remuneration in such senior executive capacities for one or more
direct or indirect subsidiaries of the Employer as the Employer
may from time to time request, subject to appropriate
authorization by the subsidiary or subsidiaries involved and any
limitations under applicable law and indemnification on the same
terms as Executive is indemnified by Employer. The failure of
Executive to discharge an order or perform a function because
Executive reasonably and in good faith believes such would
violate a law or regulation or be dishonest shall not be deemed a
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breach by him of his obligations or duties hereunder and shall
not entitle the Employer to terminate this Agreement pursuant to
any of its provisions.
(c) Certain Permissible Activities. Executive
may serve as a director or in any other capacity of any business
enterprise, including an enterprise whose activities may involve
or relate to the business of the Employer or any of its
subsidiaries provided that such service is expressly approved by
the Employer in writing. Executive may (i) make and manage
personal business investments of his choice, (ii) teach at
educational institutions and deliver lectures, and (iii) serve in
any capacity with any civic, educational or charitable
organization, or any governmental entity or trade association, in
each such case without seeking or obtaining approval by the
Employer so long as such activities and service do not materially
interfere or conflict with the performance of his duties
hereunder. It is agreed that to the extent that the Employer
shall have approved any service of Executive pursuant to the
first sentence of this Section 3(c) prior to a Change in Control
Date (as hereinafter defined in Section 9), or to the extent that
Executive may have engaged in activities pursuant to the second
sentence of this Section 3(c) prior to such Change in Control
Date, the continued conduct of such activities or the conduct of
activities similar in nature and scope thereto during the
__________ months subsequent to such Change in Control Date shall
be permissible and not in violation of any provisions of this
Agreement and such Employer approval may not be revoked or
limited in any material respect during the __________ months
following such Change in Control Date.
4. COMPENSATION AND BENEFITS.
(a) Base Salary. The Employer agrees that
Executive will be paid for his services under this Agreement a
salary at the annual rate of at least $__________, payable in
periodic installments not less frequently than monthly in
accordance with the Employer's normal salary payment dates for
executives. Such salary as in effect from time to time is
referred to herein as Executive's "Base Salary."
(b) Additional Benefits. Executive shall also be
entitled during the term of this Agreement to all rights and
benefits for which he is otherwise eligible under any bonus plan,
stock option plan, stock purchase plan, participation or extra
compensation plan, pension plan, supplemental executive
retirement plan, deferred compensation plan, profit-sharing plan,
life, medical and dental insurance policy, director and officer
liability insurance plan or indemnification program, vacation,
sick leave, family leave and holiday program or plan, or plans
that confer the use of automobiles or condominiums (and pay the
related expenses thereof) or that pay for club membership fees or
tax or financial counseling or other plans or benefits, in any
such case, which the Employer or any of its subsidiaries (i) may
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provide for Executive or (ii) provided Executive is eligible to
participate therein, may provide generally to officers of the
Employer who are of a similar class and station as those of
Executive or (iii) may provide to employees (collectively,
"Additional Benefits"). This Agreement shall not affect
adversely (from the perspective of Executive) the provisions of
any other compensation, retirement or other benefit program or
plan of the Employer or any of its subsidiaries and shall not be
considered to be a guarantee that Executive will receive any
awards or other benefits under any plans, policies or
arrangements which are performance-related.
(c) Expense Reimbursement. Executive will be
entitled to receive reimbursement from the Employer for all
reasonable travel, entertainment and other business expenses
incurred by Executive on behalf of the Employer.
(d) Office and Support Staff. During the period
of Executive's employment under this Agreement, the Employer
shall furnish Executive with an office or offices of a size and
with furnishings and other appointments, and exclusive
secretarial and other assistance, suitable for Executive's
position and responsibilities and no less favorable to Executive
than those provided to the Employer's officers who are of a
similar class and station as those of Executive. In the event of
a Change in Control, the office or offices and the furnishings
and appointments therein, and the secretarial and other
assistance, provided to Executive during the remaining term of
this Agreement shall be at least equal to the most favorable of
the foregoing provided to Executive at any time preceding the
Change in Control Date or, if more favorable to Executive, as
provided generally at any time after the Change in Control Date
to other senior officers of the Employer and its subsidiaries who
are of a similar class and station as those of Executive.
(e) Biennial Review; Limitations on Reductions.
The Board shall review Executive's Base Salary and Additional
Benefits then being paid and provided to him not less frequently
than biennially in the light of Executive's services for the
preceding period, the responsibilities which attend his office
and duties hereunder, the profitability and progress of the
Employer and its subsidiaries and concurrent salaries and
benefits then being paid to others holding similar positions.
Following such review, the Employer may increase the Base Salary
and/or Additional Benefits paid or provided to Executive, but may
not decrease the Base Salary or any of the Additional Benefits
from the then existing levels; provided, however, that the
Employer shall have the right to reduce one or more Additional
Benefits in conjunction with a corollary reduction of such
benefits applicable to all of the Employer's officers who are of
a similar class and station as those of Executive. Any increase
in Executive's Base Salary shall not serve to limit or reduce any
other obligation to Executive under this Agreement.
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5. TERMINATION UPON DISABILITY.
(a) Continuation of Benefits upon Disability. If
Executive becomes totally unable to perform his duties because of
any Disability (as hereinafter defined in this Section 5) during
the term of his employment hereunder, Executive's full-time
employment hereunder shall terminate effective on the thirtieth
(30th) day after Executive's receipt of written notice of
termination from the Employer (such thirtieth (30th) day being
referred to herein as the "Disability Effective Date"). In
addition to the payments specified in Section 6 hereof, in the
event of termination of Executive's employment pursuant to this
Section 5, the Employer shall continue to pay or provide
Executive the following:
(i) until the earliest to occur of Executive's
death, Executive's 65th birthday, __________ years after the
Disability Effective Date or the date of Executive's return to
full-time employment hereunder pursuant to Section 5(e) (such
earliest day being referred to herein as the "Disability
Termination of Benefits Date"), Base Salary at the rate
applicable to Executive immediately prior to the Disability
Effective Date, with such payments of Base Salary to be made in
conformity with payments of Base Salary to Executive prior to the
Disability Effective Date (as the same may be modified to comply
with changes in applicable law after the date of such
termination);
(ii) cash bonuses under the Employer's
Executive Short-Term Incentive Plan (the "Short-Term Plan") as in
effect on Executive's Disability Effective Date concurrent with
the payment of bonuses to the Employer's other senior executives
(whether or not such payment is before the Disability Termination
of Benefits Date) with respect to each fiscal year of the
Employer or other bonus period (each a "Bonus Period") ending on
or prior to the first anniversary of the Disability Termination
of Benefits Date, determined using the dollar amount of
Executive's target bonus award (which is currently 80% of
Executive's "Target Award Guideline" [determined without taking
into consideration company performance and without adjustment
based on individual performance] multiplied by his Base Salary
["Target Bonus Amount"]) in effect on Executive's Disability
Effective Date with bonuses for any partial Bonus Period
calculated pro rata based on the number of full weeks during the
Bonus Period prior to the earlier to occur of the end of such
Bonus Period and the Disability Termination of Benefits Date.
(iii) until the Disability Termination of
Benefits Date, medical, dental and other insurance and welfare
type Additional Benefits which were applicable to Executive
immediately prior to the Disability Effective Date (including,
without limitation, medical, dental, life and disability
insurance and the Employer's Executive Medical Reimbursement
Plan), each such benefit to be continued in a manner no less
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favorable to Executive than the benefit to which he was entitled
immediately prior to the Disability Effective Date; provided,
however, that if the Disability Termination of Benefits Date
occurs due to Executive's death during the __________ months
after the Disability Effective Date, the Employer shall continue
to pay or provide medical, dental and other insurance and welfare
type benefits, on the basis described in this clause (iii), to
Executive's family members who were covered for such benefits
immediately prior to Executive's death for the balance of such
__________ month period;
(iv) until the Disability Termination of
Benefits Date, a continuation of vesting of all unvested awards
theretofore granted by the Employer to Executive under the
Employer's 1989 Contingent Deferred Compensation Plan (the
"Deferred Plan") and all unvested restricted stock, stock options
and stock appreciation rights granted by the Employer to
Executive, such vesting to occur in accordance with the terms of
each such grant as in effect on the Disability Effective Date and
upon the assumption that no termination of employment had
occurred provided, however, that if the Disability Termination of
Benefits Date occurs due to Executive's death during the
__________ months immediately after the Disability Effective Date
or if a Change in Control occurs prior to the Disability
Termination of Benefits Date, such vesting shall include any
vesting which would occur upon Executive's death or a Change in
Control during employment with the Employer; and provided,
further, that, if and to the extent further vesting is prohibited
by the terms of any one or more of such grants or otherwise,
Executive shall be entitled to in-lieu cash payments from the
Employer on each date (each a "Vesting Date") when vesting would
have occurred absent such termination, but in no event beyond the
Disability Termination of Benefits Date, equal to (A) the fair
market value of restricted stock that would have otherwise vested
on such Vesting Date, (B) the spread on such Vesting Date between
the exercise price and fair market value of stock subject to
stock options or stock appreciation rights that would have
otherwise vested on such Vesting Date, and (C) Executive's
interest in his Accounts under the Deferred Plan that would have
vested on such Vesting Date; and provided, further, that if,
prior to the Disability Termination of Benefits Date, it is or
becomes impossible on any date to continue to calculate any
future in-lieu cash payments based on such continuation of
vesting, Executive shall thereupon be entitled immediately to the
additional vesting which would normally have occurred during such
__________ month period following the Disability Effective Date
with respect to the affected type of in-lieu cash payments
described under (A), (B) or (C) above and shall be entitled
immediately to receive payment of the amount specified under (A),
(B) or (C) for such type of in-lieu cash payments based on such
additional vesting as of such date; and
(v) until the Disability Termination of
Benefits Date, if Executive is a participant in such plans on
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Executive's Disability Effective Date, a continuation of
crediting of additional years of Cumulative Service (for all
purposes, including for purposes of accrual and vesting of
benefits) under the Employer's Supplemental Executive Retirement
Plan and Senior Supplemental Executive Retirement Plan
(collectively, the "SERP") in accordance with the terms of the
SERP and upon the assumption that no termination of employment
had occurred; provided, however, that if the Disability
Termination of Benefits Date occurs due to Executive's death
during the __________ months immediately after the Disability
Effective Date or if a Change in Control occurs prior to the
Disability Termination of Benefits Date, such continuation shall
include any further accrual and vesting which would occur upon
Executive's death or a Change in Control during employment with
the Employer; and
(vi) a pro rata cash award under the Employer's
Executive Long-Term Incentive Plan (the "Long-Term Plan") as in
effect on Executive's Disability Effective Date concurrent with
the first payment of any corresponding cash awards to the
Employer's other senior executives (whether or not such payment
is before the Disability Termination of Benefits Date) with
respect to each performance measurement cycle (as that term is
defined in the Long-Term Plan, a "Performance Measurement Cycle")
that had commenced but had not been completed prior to
Executive's Disability Effective Date, which pro rata cash award
shall be determined based on the number of full months that
Executive participated in the Long-Term Plan during each
Performance Measurement Cycle prior to the Disability Effective
Date using Executive's target cash award (which is currently 80%
of the cash award half of Executive's "Target Award Guideline"
[determined without taking into consideration company performance
and without adjustment based on individual performance]
multiplied by his Base Salary ["Target Cash Award"]) in effect on
the Disability Effective Date under the Long-Term Plan.
(b) Offset for Insurance, etc. The obligations
of the Employer to pay Executive, pursuant to this Section 5,
Base Salary and bonus amounts following his Disability shall be
reduced prospectively to the extent that Executive receives
payment of amounts under any salary continuation or similar
feature contained in any disability insurance policy covering
Executive or under any salary continuation or similar feature
under Social Security or any similar federal, state or local
program. In addition, any medical, dental and other insurance
and welfare type Additional Benefits to be provided by the
Employer pursuant to clause (iii) of Section 5(a) shall be
secondary to any similar benefits provided by Social Security,
Medicare, any private insurance maintained by or covering
Executive or any other similar plan or program covering
Executive. Executive shall provide to the Employer upon written
request from time to time a certification as to the types and
amounts of the benefits referred to in the first two sentences of
this Section 5(b) received by Executive or to which he is
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entitled.
(c) Substitution of Benefits. If Executive's
full-time services are terminated due to his Disability and
Executive is entitled under the terms of this Agreement to, but
is no longer eligible under the relevant Plan for, Additional
Benefits because of such termination, Executive (or in the event
of his death prior to the date that is __________ months after
the Disability Effective Date, his designated Beneficiaries (as
hereinafter defined in Section 6)) shall be entitled to, and the
Employer shall provide, to the extent provided in this Agreement,
benefits substantially equivalent to such Additional Benefits to
which Executive was entitled immediately prior to his Disability
and shall do so for the period during which he remains entitled
to receive such Additional Benefits as provided in this
Section 5. With respect to the continuation of such benefits,
Executive (or such Beneficiaries) shall also be paid by the
Employer an amount which, after federal, state, local or other
income or other taxes on such amount, shall reimburse Executive
(or his Beneficiaries) for any additional tax liabilities
incurred by Executive (or any such Beneficiary) by reason of the
receipt of such benefits after the termination of, rather than
during the term of, his employment under this Agreement.
(d) Partial Disability. In the event of a
partial Disability of Executive, it is understood that Executive
will provide such part-time services as may be consistent with
the nature and extent of such Disability and his position,
duties, responsibilities and status specified in Schedule I, the
Employer shall not be entitled to terminate Executive's
employment hereunder as a result of such partial Disability, and
the terms and conditions of this Agreement shall remain in full
force and effect after such partial Disability.
(e) Definition of Disability. As used in this
Agreement, the term "Disability" means the failure of Executive
to render for six (6) consecutive calendar months, or for shorter
periods aggregating one hundred thirty (130) or more business
days in any twelve (12) month period, the services contemplated
by this Agreement which a physician selected by the Employer or
its insurers and reasonably acceptable to Executive or
Executive's legal representative determines is due to mental or
physical illness or injury.
(f) Return from Disability. If and to the extent
Executive recovers from any such Disability, he will resume his
duties and responsibilities hereunder partially or fully to the
extent of his recovery, and the term of Executive's employment
under this Agreement shall be reinstated as if Executive's
employment had not been terminated pursuant to Section 5(a)
hereof.
6. PAYMENTS AND BENEFITS UPON TERMINATION OF
EMPLOYMENT FOR ANY REASON. On the Date of Termination of
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Executive's employment under this Agreement for any reason
whatsoever, Executive's Base Salary hereunder will cease
thereafter to accrue except as specifically provided in
Sections 5 or 8 and Executive (or in the event of his death, his
designated beneficiaries, his personal representative, or the
executor or administrator of his estate (his "Beneficiaries"))
will be entitled to such rights and benefits under the Employer's
compensation and benefit plans, policies and arrangements in
which Executive is then a participant as may be provided for
under such plans, policies and arrangements (which shall not be
modified adversely to Executive or his Beneficiaries after his
Date of Termination). In addition, the Employer shall:
(a) pay and deliver to Executive (or, in the
event of his death, to his Beneficiaries) not later than ten (10)
days after his Date of Termination or such later date as
Executive or such Beneficiaries may request in writing, all
amounts of money and all stock or other property owed to him by
the Employer as of the Date of Termination, including but not
limited to his accrued Base Salary, any amounts payable in lieu
of accrued vacation, amounts payable to him under any expense
reimbursement plans or policies for expenses incurred through the
Date of Termination, the amount of the bonus due under the Short-
Term Plan or Long-Term Plan to Executive for any Bonus Period or
Performance Measurement Cycle of the Employer that ended prior to
the Date of Termination which remained unpaid on the Date of
Termination and any compensation previously deferred by Executive
and any accrued interest on earnings on such deferred
compensation to the extent not previously paid to Executive;
(b) cause the trustee of any trusteed plan of the
Employer to pay and deliver, and the Employer shall pay and
deliver under any similar non-trusteed plan of the Employer, to
Executive (or, in the event of his death, to his Beneficiaries),
at the earliest practicable date after payments become due, all
money, stock and other property which such plans require to be
paid or delivered or are otherwise payable or deliverable to him
after the termination of his employment;
(c) continue to insure Executive (or, in the
event of his death, his Beneficiaries) with respect to his
activities as a director, officer or employee of the Employer or
any of its subsidiaries, for a period of __________ years after
such Date of Termination, under such policies of director and
officer liability insurance as Employer shall provide for its
senior officers generally; provided, however, that if a Change in
Control shall have occurred prior to such Date of Termination or
shall thereafter occur, such policies of insurance shall be no
less favorable to Executive than such policies as may have been
in effect for Executive at any time during the one hundred twenty
(120) day period immediately preceding the Change in Control
Date; and
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(d) continue to honor such rights to
indemnification as Executive (or, in the event of his death, his
Beneficiaries) may be entitled pursuant to any plan of
indemnification or indemnification agreement in effect at the
Date of Termination.
7. TERMINATION OF EMPLOYMENT BY EMPLOYER FOR CAUSE.
(a) Definition of Cause. The Employer may
terminate Executive's employment under this Agreement if the
termination is for Cause upon compliance with the requirements of
Section 7(b) hereof. For purposes of this Agreement, the
Employer shall have "Cause" to terminate Executive's employment
hereunder if, and only if, any of the following shall occur:
(i) Executive's conviction by a court of
competent jurisdiction or entry of a plea of nolo contendere for
an act on Executive's part constituting a felony and resulting or
intended to result directly or indirectly in demonstrably
material injury to the Employer or any of its affiliates or
substantial gain or personal enrichment to Executive at the
expense of the Employer or any of its affiliates; or
(ii) a willful breach by Executive of any
provisions of this Agreement if such breach results in
demonstrably material injury to the Employer.
(b) Procedural Requirements. Executive's
employment hereunder shall not be subject to termination for
Cause without: (i) reasonable notice to Executive setting forth
the reasons for Employer's intention to terminate and specifying
the particulars thereof in detail, (ii) an opportunity for
Executive to cure any such breach, if possible, within fifteen
(15) days after receipt of such notice, (iii) an opportunity for
Executive, together with his counsel, to be heard before the
Board, and (iv) delivery to Executive of a notice of termination
stating that at least two-thirds of the authorized number of
Employer's directors have found that Executive was guilty of
conduct set forth in Section 7(a) and specifying the particulars
thereof in detail. Any such termination will be effective upon
fifteen (15) days' prior written notice to Executive.
8. TERMINATION OF EMPLOYMENT BY EXECUTIVE FOR GOOD
REASON OR BY EMPLOYER WITHOUT CAUSE.
(a) Definition of Good Reason. Executive may
terminate his employment under this Agreement and all of his
obligations hereunder to the Employer accruing after the date of
such termination (other than his obligations under Section 8(e),
8(f) 9(f), 11 and 12), if the termination is for "Good Reason,"
which for purposes of this Agreement is defined as:
(i) failure by the Employer to perform any of
its obligations hereunder (including, but not limited to,
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Employer's obligations under Sections 3 and 4) other than an
isolated, insubstantial and inadvertent failure not occurring in
bad faith and which is remedied by the Employer promptly after
receipt of notice thereof given by Executive; or
(ii) failure to reelect or removal of Executive
as a member of the Employer's Board of Directors or its Executive
Committee, if Executive is now or hereafter becomes such a
member.
Any such termination will be effective upon fifteen (15) days'
prior written notice from Executive to the Employer.
(b) Employer's Termination Without Cause. The
Employer may terminate Executive's employment under this
Agreement without Cause (as defined in Section 7 hereof) by
written notice to Executive. Any such termination shall become
effective upon fifteen (15) days' prior written notice from the
Employer to Executive.
(c) Compensation and Benefits Upon Section 8
Termination. In addition to the payments specified in Section 6
hereof, in the event of termination of Executive's employment
pursuant to this Section 8, the Employer shall continue to pay or
provide to Executive the following:
(i) until the earliest to occur of the date
that is __________ months after such Date of Termination,
Executive's 65th birthday, or Executive's death (such earliest
date being referred to herein as the "Section 8 Termination of
Benefits Date"), Base Salary at the rate applicable to Executive
immediately prior to his Date of Termination, with such payments
of Base Salary to be made in conformity with payments of Base
Salary to Executive prior to such termination (as the same may be
modified to comply with changes in applicable law after the date
of such termination);
(ii) cash bonuses under the Short-Term Plan as
in effect on Executive's Date of Termination concurrent with the
payment of bonuses to the Employer's other senior executives
(whether or not such payment is before the Section 8 Termination
of Benefits Date) with respect to each Bonus Period ending on or
prior to the first anniversary of the Section 8 Termination of
Benefits Date, determined using Executive's Target Bonus Amount
in effect on Executive's Date of Termination with bonuses for any
partial Bonus Period calculated pro rata based on the number of
full weeks during the Bonus Period prior to the earlier to occur
of the end of such Bonus Period and the Section 8 Termination of
Benefits Date.
(iii) until the Section 8 Termination of
Benefits Date, medical, dental and other insurance and welfare
type Additional Benefits which were applicable to Executive
immediately prior to such Date of Termination (including, without
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limitation, medical, dental, life and disability insurance and
Executive Medical Reimbursement Plan), each such benefit to be
continued in a manner no less favorable to Executive than the
benefit to which he was entitled immediately prior to such
termination; provided, however, that if the Section 8 Termination
of Benefits Date occurs due to Executive's death during the
__________ months after the Date of Termination, the Employer
shall continue to pay or provide medical, dental and other
insurance and welfare type benefits, on the basis described in
this clause (iii), to Executive's family members who were covered
for such benefits immediately prior to Executive's death for the
balance of such __________ month period;
(iv) until the Section 8 Termination of
Benefits Date, a continuation of vesting of all unvested awards
granted by the Employer to Executive under the Deferred Plan and
all unvested restricted stock, stock options, stock appreciation
rights granted by the Employer to Executive, such vesting to
occur in accordance with the terms of each such grant as in
effect on the Date of Termination and upon the assumption that no
termination of employment had occurred; provided, however, that
if the Section 8 Termination of Benefits Date occurs due to
Executive's death during such __________ month period immediately
after the Date of Termination or a Change of Control occurs prior
to the Section 8 Termination of Benefits Date, such vesting shall
include any vesting which would occur upon Executive's death or a
Change in Control during employment with the Employer; and
provided, further, that, if and to the extent further vesting is
prohibited by the terms of any one or more of such grants or
otherwise, Executive shall be entitled to in-lieu cash payments
from the Employer on each date (each, a "Vesting Date") when
vesting would have occurred absent such termination, but in no
event beyond the Section 8 Termination of Benefits Date, equal to
(A) the fair market value of restricted stock that would have
otherwise vested on such Vesting Date, (B) the spread on such
Vesting Date between the exercise price and fair market value of
stock subject to stock options or stock appreciation rights that
would have otherwise vested on such Vesting Date, and
(C) Executive's interest in his Accounts under the Deferred Plan
that would have vested on such Vesting Date; and provided,
further, that if, prior to the Section 8 Termination of Benefits
Date, it is or becomes impossible on any date to continue to
calculate any future in-lieu cash payments based on such
continuation of vesting, Executive shall thereupon be entitled
immediately to the additional vesting which would normally have
occurred during such __________ month period following the Date
of Termination with respect to the affected type of in-lieu cash
payments described under (A), (B) or (C) above and shall be
entitled immediately to receive payment of the amount specified
under (A), (B) or (C) for such type of in-lieu cash payments
based on such additional vesting as of such date; and
(v) until the Section 8 Termination of
Benefits Date, a continuation of crediting of additional years of
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Cumulative Service (for all purposes, including for purposes of
accrual and vesting of benefits) under the SERP in accordance
with the terms of the SERP and upon the assumption that no
termination of employment had occurred; provided, however, that
if the Section 8 Termination of Benefits Date occurs due to
Executive's death during the __________ months immediately after
the Date of Termination or if a Change in Control occurs prior to
the Section 8 Termination of Benefits Date, such continuation
shall include any further accrual and vesting which would occur
upon Executive's death or a Change in Control during employment
with the Employer; and
(vi) a pro rata cash award under the Long-Term
Plan concurrent with the first payment of any corresponding cash
awards to the Employer's other senior executives (whether or not
such payment is before the Section 8 Termination of Benefits
Date) with respect to each Performance Measurement Cycle that had
commenced but had not been completed prior to Executive's Date of
Termination, which pro rata cash award shall be determined based
on the number of full months that Executive participated in the
Long-Term Plan during each Performance Measurement Cycle prior to
such Date of Termination using Executive's Target Cash Award in
effect on the Date of Termination under the Long-Term Plan.
(d) Substitution of Benefits. If Executive's
employment is terminated pursuant to this Section 8 and Executive
is entitled under the terms of this Agreement to, but is no
longer eligible under the relevant plan for, Additional Benefits
because of such termination, Executive (or in the event of his
death, his designated Beneficiaries) shall be entitled to, and
the Employer shall provide, to the extent provided in this
Agreement, benefits substantially equivalent to such Additional
Benefits to which Executive was entitled immediately prior to
such termination and shall do so for the period during which he
remains entitled to receive such Additional Benefits as provided
in this Section 8. With respect to the continuation of such
benefits, Executive (or such Beneficiaries) shall also be paid by
the Employer an amount which, after federal, state, local or
other income or other taxes on such amount, shall reimburse
Executive (or his Beneficiaries) for any additional tax
liabilities incurred by Executive (or any such Beneficiary) by
reason of the receipt of such benefits after the termination of,
rather than during the term of his employment under this
Agreement.
(e) Mitigation; Certain Reductions in Benefits. In the event of
termination of Executive's employment pursuant to this Section 8,
Executive shall have no duty to seek other employment or
otherwise mitigate the Employer's obligations hereunder.
However, the Employer and Executive agree that if Executive
receives any income for services rendered by Executive to persons
or entities other than the Employer or any of its subsidiaries
during or with respect to any period prior to the Section 8
Termination of Benefits Date, the amounts payable by the Employer
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with respect to any month during such __________ month period
shall be reduced by an amount equal to one hundred per cent
(100%) of the income received by Executive for services rendered
with respect to such month and, if such income received by
Executive with respect to any month during such __________ month
period exceeds the amounts payable by the Employer with respect
to such month, such excess shall be carried forward to reduce the
obligation of the Employer to pay Executive pursuant to Section 8
with respect to any subsequent month. In addition, if Executive
receives any benefits of the kind referred to in clause (iii) of
Section 8(c) that are attributable to services rendered by
Executive to persons or entities other than the Employer or any
of its subsidiaries, such benefits shall be applied to reduce the
Employer's obligation to provide such benefits under clause (iii)
of Section 8(c) by having such successor be the primary provider
of such benefits.
(f) Notification of Other Employment;
Accountings. If Executive's employment is terminated pursuant to
this Section 8, Executive shall give the Employer prompt written
notice if Executive renders services to any person or entity
other than the Employer or any of its subsidiaries at any time
prior to the Section 8 Termination of Benefits Date. In
addition, Executive shall provide to the Employer upon written
request from time to time a certification from Executive as to
the benefits provided to Executive and his dependents in
connection with such services. If Executive's employment is
terminated pursuant to this Section 8, then not later than thirty
(30) days after each December 31 occurring prior to the second
anniversary of the Section 8 Termination of Benefits Date,
Executive shall account to the Employer with respect to all
payments received by Executive which are required to be offset
against payments by Employer pursuant to Section 8. If the
Employer has paid amounts with respect to any year pursuant to
Section 8 in excess of those to which Executive was entitled
(after giving effect to the offsets provided above), Executive
shall reimburse the Employer for such excess by the January 30
immediately following such year.
9. CHANGE IN CONTROL.
(a) Effectiveness of Section. If at any time
during the term of Executive's employment by the Employer
pursuant to this Agreement, a Change in Control of the Employer
(as hereinafter defined in this Section 9) shall occur, the
provisions of this Section 9 shall become effective without any
limitation on any other rights Executive may have hereunder.
Sections (d) and (e) of this Section 9 shall become ineffective
with respect to such Change in Control on the third anniversary
of the date on which such Change in Control occurs (the "Change
in Control Date") unless Executive's employment has theretofore
been terminated for any reason; provided, however, that if
another Change in Control occurs after such third anniversary,
Sections 9(d) and (e) shall become effective once again with
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respect to such subsequent Change in Control. If Executive's
employment so terminates prior to such third anniversary, the
provisions of Sections 9(d) and (e) shall survive so long as
Executive or his Beneficiaries are entitled to any benefits under
this Agreement.
(b) Definition of Change in Control. For the
purpose of this Agreement, a "Change in Control" shall mean:
(i) the acquisition by any individual, entity
or group (within the meaning of Section 13(d)(3) or 14(d)(2) of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act")) (a "Person") of beneficial ownership (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of twenty-five
percent (25%) or more of either (A) the then outstanding shares
of common stock of the Employer (the "Outstanding Employer Common
Stock") or (B) the combined voting power of the then outstanding
voting securities of the Employer entitled to vote generally in
the election of directors (the "Outstanding Employer Voting
Securities"); provided, however, that for purposes of this clause
(i), the following acquisitions shall not constitute a Change in
Control: (w) any acquisition directly from the Employer, (x) any
acquisition by the Employer, (y) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the
Employer or any corporation controlled by the Employer or (z) any
acquisition by any corporation pursuant to a transaction which
complies with clauses (A), (B) and (C) of clause (iii) of this
Section 9(b); or
(ii) individuals who, as of the date hereof,
constitute the Board (the "Incumbent Board") cease for any reason
to constitute at least a majority of the Board; provided,
however, that any individual becoming a director subsequent to
the date hereof whose election, or nomination for election by the
Employer's stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board
shall be considered as though such individual were a member of
the Incumbent Board, but excluding, for this purpose, any such
individual whose initial assumption of office occurs as a result
of an actual or threatened election contest with respect to the
election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person
other than the Board; or
(iii) consummation of a reorganization, merger
or consolidation or sale or other disposition of all or
substantially all of the assets of the Employer (a "Business
Combination"), in each case, unless, following such Business
Combination, (A) all or substantially all of the Persons who were
the beneficial owners, respectively, of the Outstanding Employer
Common Stock and Outstanding Employer Voting Securities
immediately prior to such Business Combination beneficially own,
directly or indirectly, more than 50% of, respectively, the then
outstanding shares of common stock and the combined voting power
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of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of
the corporation resulting from such Business Combination
(including, without limitation, a corporation which as a result
of such transaction owns the Employer or all or substantially all
of the Employer's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their
ownership, immediately prior to such Business Combination of the
Outstanding Employer Common Stock and Outstanding Employer Voting
Securities, as the case may be, (B) no Person (excluding any
corporation resulting from such Business Combination or any
employee benefit plan (or related trust) of the Employer or such
corporation resulting from such Business Combination)
beneficially owns, directly or indirectly, twenty-five percent
25% or more of, respectively, the then outstanding shares of
common stock of the corporation resulting from such Business
Combination or the combined voting power of the then outstanding
voting securities of such corporation except to the extent that
such ownership existed prior to the Business Combination and
(C) at least a majority of the members of the board of directors
of the corporation resulting from such Business Combination were
members of the Incumbent Board at the time of the execution of
the initial agreement, or of the action of the Board, providing
for such Business Combination; or
(iv) approval by the stockholders of the
Employer of a complete liquidation or dissolution of the
Employer.
(c) Additional Termination Right. If a Change in
Control of the Employer shall occur, Executive shall have the
right to terminate his employment with the Employer for any
reason or no reason by written notice to the Employer given at
any time during the thirty (30) day period commencing on the
first anniversary of the Change in Control Date, and such
termination shall be deemed to be termination for Good Reason
pursuant to Section 8 hereof and shall thereby entitle the
Executive to the benefits set forth in Section 9(e).
(d) Certain Restrictions Following Change in
Control. If a Change in Control of the Employer occurs, then the
following provisions shall apply:
(i) the Employer shall not be entitled to
reduce, terminate or adversely (from the Executive's point of
view) affect, pursuant to the proviso to the second sentence of
Section 4(e), any Additional Benefits which are described in
Section 4(b) to which Executive shall thereafter be entitled even
in connection with a reduction in such benefits applicable to all
of the Employer's officers who are of a similar class and station
as those of Executive;
(ii) in addition to Executive's Base Salary,
Executive shall be paid, for each Bonus Period ending prior to
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his Date of Termination, an annual bonus (an "Annual Bonus") in
cash at least equal to 125% of Executive's Target Bonus Amount in
effect on the Change in Control Date under the Short-Term Plan as
in effect on the Change in Control Date; and
(iii) all restricted stock, stock options, stock
appreciation rights, Contingent Deferred Compensation and similar
grants theretofore or thereafter made which are unvested shall
immediately vest effective as of the Change in Control Date.
(e) Provisions Applicable to Termination of
Employment. If a Change in Control shall occur and Executive's
employment is thereafter terminated by the Employer other than
for Cause, or by Executive for Good Reason pursuant to Section 8
(including a termination under the authority granted in
Section 9(c) hereof):
(i) Executive shall be entitled to the
payments and benefits provided in Section 6 hereof;
(ii) in lieu of the payments required by the
provisions of clauses (i), (ii) and (vi) of Section 8(c) hereof
the Employer shall pay to Executive in a lump sum in cash within
ten (10) days after the Date of Termination (or such later date
as Executive may elect) the aggregate of the following amounts:
(A) an amount equal to the product of
(1) the higher of (y) 125% of Executive's Target Bonus Amount in
effect on the Change in Control Date under the Short-Term Plan as
in effect on the Change in Control Date or (z) 125% of
Executive's Target Bonus Amount in effect on the Date of
Termination under the Short-Term Plan as in effect on the Change
in Control Date or under any other bonus plan then maintained by
the Employer (such higher amount being referred to herein as the
"Termination Bonus Amount"), multiplied by (2) a fraction, the
numerator of which is the number of days that have elapsed in the
current Bonus Period of the Employer through the Date of
Termination and the denominator of which is 365;
(B) an amount equal to the product of
three multiplied times the sum of (y) Executive's Base Salary as
in effect on the Date of Termination plus (z) the Termination
Bonus Amount for Executive; and
(C) with respect to each Performance
Measurement Cycle that had commenced but had not been completed
prior to such Date of Termination under the Long-Term Plan, an
amount equal to the product of (1) the higher of (y) 125% of
Executive's Target Cash Award for such Performance Measurement
Cycle as in effect immediately prior to the Change in Control
Date or (z) 125% of Executive's Target Cash Award for such
Performance Measurement Cycle as in effect immediately prior such
Date of Termination, multiplied by (2) a fraction, the
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denominator of which is the number of days in such Performance
Measurement Cycle and the numerator of which is the number of
days elapsing from the date such Performance Measurement Cycle
commenced through such Date of Termination;
(iii) the provisions of the second sentence of
Section 8(e) and the last two sentences of Section 8(f) shall not
be operative following a termination of Executive's employment
pursuant to Section 8;
(iv) the Employer shall reimburse Executive
upon demand for up to an aggregate of Ten Thousand Dollars
($10,000) of fees and disbursements paid to Executive's legal,
accounting, tax and financial advisors for services rendered by
them to Executive in connection with or as a result of his
termination of employment hereunder; and
(v) the Employer shall, at its sole expense as
incurred, provide Executive with outplacement services the scope
and provider of which shall be selected by Executive in his sole
discretion.
(f) Tax Gross Up.
(i) If any payments or other benefits under
this Agreement or any other payments or benefits received or to
be received by Executive in connection with or as a result of a
Change in Control of the Employer, or Executive's termination of
employment, whether pursuant to the terms of this Agreement or
any other plan, arrangement or agreement with the Employer, or
any person affiliated with the Employer ("Change in Control
Payments"), will be subject to tax imposed by Section 4999 of the
Internal Revenue Code of 1986, as amended (hereinafter referred
to as the "Code," references to which shall be understood to
include any successor statute and references to the applicable
regulations under the Code as promulgated from time to time), or
any comparable provision of state law or any similar tax that may
hereafter be imposed ("Excise Tax"), the Employer shall pay at
the times hereinafter specified in this Section 9(f) additional
amounts (each a "Gross-Up Payment") such that the net amount
retained by Executive, after withholding or payment of any Excise
Tax on the Change in Control Payments and any federal, state and
local income tax and Excise Tax upon the Gross-Up Payment shall
be equal to the Change in Control Payments. Notwithstanding the
foregoing provisions of this Section 9(f), if it shall be
determined that Executive is entitled to a Gross-Up Payment, but
that the Change in Control Payments do not exceed 110% of the
greatest amount (the "Reduced Amount") that could be paid to
Executive such that the receipt of Change in Control Payments
would not give rise to any Excise Tax, then no Gross-Up Payment
shall be made to Executive and the Change in Control Payments, in
the aggregate, shall be reduced to an amount such that the
receipt of Change in Control Payments would not give rise to any
Excise Tax.
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(ii) For purposes of determining whether any of
the Change in Control Payments will be subject to the Excise Tax
and the amount of such Excise Tax, (i) all Change in Control
Payments shall be treated as "parachute payments" within the
meaning of Section 28OG(b)(2) of the Code, and all "excess
parachute payments" within the meaning of Section 28OG(b)(1)
shall be treated as subject to the Excise Tax except to the
extent that (in the opinion of tax counsel selected by the
Employer's independent auditors and reasonably acceptable to
Executive, which opinion shall be rendered at the Employer's sole
expense and shall be reasonably acceptable to Executive and which
opinion shall, once accepted by Executive, be binding on all
parties) such Change in Control Payments do not constitute
parachute payments, or such excess parachute payments are reduced
pursuant to 28OG(b)(4)(B) of the Code, (ii) the counsel referred
to in clause (i) of this sentence shall be entitled to request
and rely, as to factual matters regarding the determinations
called for therein, upon appraisals and valuations by experts
acceptable to the Employer and Executive (and prepared at the
Employer's expense) and (c) the value of any non-cash benefits or
any deferred or contingent payment or benefit shall be determined
by the Employer's independent auditors in accordance with the
principles of Section 28OG(d)(3) and (4) of the Code.
(iii) For purposes of determining the amount of
the Gross-Up Payment, Executive shall be deemed to pay federal
income taxes at his highest marginal rate of federal income
taxation on the Date of Termination, and state and local income
taxes at his highest marginal rate of taxation in the applicable
states and localities on the Date of Termination, net of the
maximum reduction in federal income taxes that could be obtained
from deduction of such state and local taxes.
(iv) In the event that the Excise Tax is
finally determined to be less than the amount taken into account
hereunder at the time of termination of Executive's employment,
Executive shall repay to the Employer, promptly after the amount
of such reduction in Excise Tax is finally determined, but no
later than thirty days after his receipt of notice from the
Employer in reasonable detail requesting the same, the portion of
the Gross-Up Payment attributable to such reduction, plus the
portion of the Gross-Up Payment attributable to the Excise Tax
and federal and state and local income tax imposed on the Gross-
Up Payment being repaid by him if such repayment results in a
reduction in Excise Tax and/or a federal and state and local
income tax deduction) and interest from the date of his receipt
of the Change in Control Payments on the amount of such repayment
at the rate provided in Section 1274(b)(2)(B) of the Code (the
"Applicable Rate"). For purposes of this Agreement, the final
determination of any Excise Tax shall be deemed to have occurred
at the audit level unless the Employer shall have elected to
contest or requested that Executive contest the matter (with
which Executive shall cooperate, and Executive agrees to notify
the Employer promptly in the event of any audit of his applicable
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tax returns by any authority) in which case the final
determination shall be the final decision by the appropriate
governmental authority.
(v) In the event that the Excise Tax is
finally determined to exceed the amount taken into account
hereunder at the time of the termination of Executive's
employment (including by reason of any payment the existence or
amount of which cannot be determined at the time of the Gross-Up
Payment), the Employer shall make an additional Gross-Up Payment,
computed as provided in this Section 9(f), in respect of the sum
of such excess amount plus any interest payable by Executive to
any tax authority with respect to such excess amount as an
additional Change in Control Payment.
10. INDEMNITY. To the extent permitted by applicable
law and the By-Laws of the Employer (as from time to time in
effect or if a Change in Control occurs, as in effect on the
Change in Control Date) and without in any way impairing or
affecting any rights to indemnification that Executive has by
reason of any agreement to which he is a party as of the date
hereof, the Employer shall:
(a) indemnify Executive and hold him harmless for
any acts or decisions made by him in good faith while performing
services for the Employer;
(b) use reasonable efforts to obtain coverage for
him under liability insurance policies now in force or hereafter
obtained during the term of his full time services under this
Agreement (or, if a Change in Control occurs, as in effect on the
Change in Control Date) covering the other officers or directors
of the Employer; and
(c) pay as incurred all expenses, including
reasonable attorneys' fees and the amounts of court approved
settlements, actually incurred by Executive in connection with
the defense of any action, suit or proceeding, and in connection
with any appeal thereon, which has been and/or may be brought
against Executive by reason of Executive's services as an
officer, director, employee or agent of the Employer or of any
affiliate of the Employer.
11. CONFIDENTIALITY. Executive agrees that he shall
not divulge or otherwise disclose, directly or indirectly, any
trade secret or other confidential information concerning the
business or policies of the Employer or any of its affiliates
which he may have learned as a result of his employment during
the term of this Agreement (including any extension thereof) or
prior thereto as an employee, officer or director of the Employer
or any of its affiliates, except to the extent such use or
disclosure is (i) necessary to the performance of this Agreement
and in furtherance of the Employer's best interests,
(ii) required by applicable law, (iii) lawfully obtainable from
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other sources or (iv) authorized by the Employer. The provisions
of this Section 11 shall survive the suspension or termination,
for any reason, of this Agreement.
12. ARBITRATION OF DISPUTES. The provisions of
Schedule II are incorporated herein by reference. In the event
of any conflict between Schedule II and this Agreement, the terms
of this Agreement shall prevail. Notwithstanding the pendency of
any dispute or controversy, the Employer will continue to pay
Executive his full compensation in effect when the notice giving
rise to the dispute was given (including, but not limited to,
Base Salary, Annual Bonuses and awards under the Long-Term Plan)
and continue Executive as a participant under all plans,
policies, practices or programs in which Executive was
participating when the notice giving rise to the dispute was
given, until the dispute is finally resolved in accordance with
the procedures described in Schedule II attached hereto. As used
in Schedule II, the term "you" shall also mean, in the event of
Executive's death, his designated beneficiaries, his personal
representative or the executor or administrator of his estate.
The provisions of this Section 12 shall survive the suspension or
termination, for any reason, of this Agreement.
13. GENERAL PROVISIONS.
(a) Notices. Any notices provided for in this
Agreement shall be sent to the Employer at 4900 Rivergrade Road,
Irwindale, California, 91706, Attention: Executive Vice
President -- Legal, with a copy to the Chairman of the
Compensation Committee of the Board at the same address, or to
such other address as the Employer may from time to time in
writing designate, and to Executive at such address as he may
from time to time in writing designate (or his business address
of record with the Employer in the absence of such designation).
All notices shall be deemed to have been deposited as certified
mail, return receipt requested, postage paid, or one (1) business
day after they have been deposited as overnight mail, in either
event properly addressed to the designated address of the party
to receive the notice, or shall be deemed to have been given at
the time receipt is acknowledged if given by any form of
electronic communication. Any notice required or permitted to be
given under this Agreement will be deemed given only when it is
in fact received by the addressee.
(b) Entire Agreement. Any previous written or
oral employment agreement between Executive and the Employer or
any affiliate of the Employer is hereby canceled. Subject to the
cancellation of any such employment agreement, the rights of
Executive hereunder shall be in addition to, and not in
substitution for or diminution of, the rights of Executive under
any other written plan or agreement between the Employer and
Executive which now exists or is hereafter made. Except for such
other plans or agreements, if any, this Agreement constitutes the
entire understanding between the parties with respect to the
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subject matter hereof, superseding all negotiations, prior
discussions and preliminary agreements, written or oral.
(c) Governing Law. This Agreement will be
governed by and construed in accordance with the laws of the
State of California.
(d) Savings Clause. Should this Agreement or any
of its provisions be in violation of applicable law, the Employer
will take every possible action not in violation of applicable
law to provide Executive with the economic benefits intended to
be provided to him by this Agreement, or with the nearest
economic equivalents thereto, and any provisions not in violation
of applicable law shall, so far as possible, be given effect and
shall not be affected by such violation. The invalidity or
unenforceability of any provision or portion of this Agreement
shall, so far as possible, not affect the validity or
enforceability of the other provisions or portions of this
Agreement.
(e) No Assignments; Assumption by Successor.
This Agreement is personal to the Employer and to Executive and
may not be assigned by either party without the written consent
of the other. The Employer will require any successor (whether
direct or indirect by purchase, merger, consolation or otherwise)
to all or substantially all of the business and/or assets of the
Employer to (i) expressly assume and agree to perform this
Agreement in the same manner and the same extent the Employer
would be required to perform it as if no such succession had
taken place; and (ii) notify Executive of the assumption of this
Agreement within ten (10) days of such assumption. Failure of
the Employer to obtain such assumption and agreement prior to the
effectiveness of any such succession shall be a breach of this
Agreement. As used in this Agreement, "Employer" shall mean H.F.
Ahmanson & Company and any successor to its business and/or
assets as aforesaid which assumes and agrees to perform this
Agreement by operation of law or otherwise. However, this
Agreement shall inure to the benefit of and be enforceable by
Executive's personal or legal representatives, executors,
administrators, successors, heirs, and distributees, devisees and
legatees.
(f) No Set-Off. The Employer's obligation to
make the payments provided for in this Agreement and otherwise to
perform its obligations hereunder shall not be affected by any
set-off, counterclaim, recoupment, defense or other claim, right,
or action which the Employer may have against Executive or
others. In no event shall Executive be obligated to seek other
employment or take any other action by way of mitigation of the
amounts payable, or benefits to be provided, to Executive under
any of the provisions of this Agreement, and, except as expressly
provided in Sections 5(b) and 8 hereof (in the case of Section 8,
as the same may be modified by clause (iii) of Section 9(e)),
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such amounts shall not be reduced whether or not Executive
obtains other employment.
(g) No Constructive Waivers. Either party's
failure to enforce any provision or provisions of this Agreement
will not in any way be construed as a waiver of any such
provision or provisions, or prevent that party thereafter from
enforcing each and every other provision of this Agreement.
(h) Legal Fees and Expenses. The Employer agrees
to pay as incurred, to the full extent permitted by applicable
law, all legal fees and expenses which Executive may reasonably
incur as a result of any contest (regardless of the outcome
thereof) by the Employer, Executive or others of the validity or
enforceability of, or liability under, any provision of this
Agreement or any guarantee of performance thereof (including as a
result of any contest by Executive about the amount of any
payment pursuant to this Agreement), plus in each case interest
on any delayed payment at the applicable Federal rate provided
for in Section 7872(f)(2)(A) of the Code. As used in this
Section 13(h), the term "Executive" shall also mean, in the event
of Executive's death, his designated beneficiaries, his personal
representative, or the executor or administrator of his estate.
(i) Withholdings. The Employer may withhold from
any amounts payable under this Agreement an amount sufficient to
satisfy the minimum requirements set by applicable law to be
withheld therefrom for withholding and payroll taxes.
(j) No Oral Modifications. No modification or
waiver of any provision hereof will be binding or valid unless in
writing and executed by both parties.
(k) Legal Representation. Executive acknowledges
that he has been given the opportunity to consult with counsel of
his own choosing in connection with the negotiation and execution
of this Agreement. Executive acknowledges that neither any
attorney employed by the Employer or any outside counsel employed
by the Employer (including, without limitation, Gibson, Dunn &
Crutcher) in connection herewith has provided legal or other
advice to Executive in connection with his negotiation or
execution of this Agreement and that all such counsel have
provided services in connection herewith solely to the Employer.
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IN WITNESS WHEREOF, the parties have duly executed this
Agreement on the day and year first above written.
EMPLOYER: H. F. AHMANSON & COMPANY
By:
EXECUTIVE:
Name:
Address:
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SCHEDULE I
SERVICES TO BE RENDERED BY EXECUTIVE
Position Title:
Name of Entity to Which
Services Are to be Rendered:
Position Reports to:
H. F. AHMANSON & COMPANY
EMPLOYMENT AGREEMENTS WITH EXECUTIVE OFFICERS
Executive Date of Agreement Term (months)
Charles R. Rinehart 2/ 6/96 36
Bruce G. Willison 4/16/96 36
Kevin M. Twomey 2/ 6/96 36
Madeleine A. Kleiner 2/ 6/96 36
Anne-Drue Anderson 2/ 6/96 36
E. Nancy Markle 2/ 6/96 36
George Miranda 2/ 6/96 24
