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EXHIBIT 10.1
EMPLOYMENT AGREEMENT
THIS AGREEMENT, (the "Agreement") is entered into as of July 1, 2000,
between WESTPOINT STEVENS INC., a Delaware corporation with its principal place
of business in West Point, Georgia (the "Company"), and HOLCOMBE T. GREEN, JR.,
an individual resident of Georgia (the "Executive").
W I T N E S S E T H:
WHEREAS, the Company is engaged in the manufacturing and marketing of
home fashion consumer products throughout the United States and abroad; and
WHEREAS, the Executive is employed by the Company as its Chief
Executive Officer;
WHEREAS, the Company desires to continue the employment of the
Executive, and the Executive desires to continue employment with the Company,
on the terms and subject to the conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and obligations hereinafter set forth, the parties hereto, intending
to be legally bound, hereby agree as follows:
1. Effective Date. This Agreement is effective as of July 1, 2000
(the "Effective Date").
2. Term. This Agreement shall be for a three-year term commencing
on the Effective Date and shall be extended on a daily basis without further
action by the Executive or the Company (such period of time, collectively, the
"Term of Employment"); provided, however, that either party may, by written
notice to the other party, cause the Term of Employment to cease to extend
automatically. The Term of Employment shall end on the third anniversary of the
date of such notice.
3. Duties. During the Term of Employment, the Executive shall
serve as the Company's Chief Executive Officer. In such capacity, the Executive
shall oversee all matters relating to the management of the Company (subject to
the supervision of the Board of Directors (the "Board")) and shall also have
such other or more specific responsibilities or duties consistent with the
Executive's position as Chief Executive Officer as may be determined and
assigned to the Executive from time to time by or upon the authority of the
Board. The Executive shall serve the Company faithfully and to the best of his
ability in such capacities, devoting such business time, attention, knowledge,
energy and skills to such employment as may be required by such duties;
provided, however, that the Executive may devote reasonable periods of time to
civic or community affairs and engage in other business and investment
activities, so long as such activities do not, individually or in the
aggregate, significantly interfere with the performance by the Executive of his
duties under this Agreement or violate the provisions of Section 9 of this
Agreement. If elected, the Executive also shall serve during any part of the
Term of Employment as any other officer or a director of the
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Company or any subsidiary corporation or parent corporation of the Company
without any compensation therefor other than as specified in this Agreement.
4. Compensation and Benefits.
(a) Base Salary. During the Term of Employment, the
Company shall pay to the Executive a base salary, payable in accordance with
the Company's standard payroll practices for senior executive employees,
commencing at an annual rate of $1,030,000 ("Base Salary"); provided, however,
that such Base Salary shall be reviewed at least annually by the Board of the
Company or the Compensation Committee thereof in light of the Company's
performance during the preceding year, and the Board or the Compensation
Committee thereof may, in its sole discretion, increase (but not decrease) such
Base Salary based on such review.
(b) Incentive Compensation. During the Term of
Employment, the Executive shall be entitled to participate in all incentive,
savings and retirement plans, practices, policies and programs applicable
generally to senior executive officers of the Company. Without limiting the
foregoing, the following shall apply:
(i) the Executive shall participate in the top
bonus category of the Company's Senior Management Incentive Plan the (the
"MIP"), as in effect from time to time, at a level commensurate with other
senior executives of the Company;
(ii) the Executive shall participate in the
Company's Key Employee Stock Bonus Plan (the "Stock Bonus Plan"), as in effect
from time to time; and
(iii) the Executive shall be entitled to
participate in grants of options and other awards under the Company's Omnibus
Stock Incentive Plan (the "Omnibus Plan") or any successor or similar plans,
the level of such participation to be commensurate with other senior executives
of the Company, as determined in good faith by the Board or the Compensation
Committee of the Company.
(c) Welfare Benefit Plans. During the Term of Employment,
the Executive shall be entitled to participate in any medical, dental,
disability, insurance, retirement, savings, vacation or other welfare or fringe
benefit plans or programs made available to the Company's senior executive
officers.
(d) Expenses. During the Term of Employment, the
Executive shall be entitled to prompt reimbursement for all reasonable
business-related expenses incurred by the Executive in accordance with the
policies and procedures of the Company as in effect from time to time with
respect to other senior executives.
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(e) Vacation. During the Term of Employment, the
Executive shall be entitled to paid vacation in accordance with the policies of
the Company as in effect with respect to other senior executives, but in no
event shall such vacation time be less than five weeks per calendar year.
(f) Fringe Benefits. During the Term of Employment, the
Executive shall be entitled to all of the fringe benefits that are from time to
time available to other senior executives. Without limiting the foregoing, the
Executive shall be entitled to (i) an automobile allowance in accordance with
Company policy, and (ii) reasonable personal use of Company aircraft, provided
that such use shall not interfere with the Company's business use of such
aircraft.
(g) Club Membership. During the Term of Employment, the
Company shall pay to the Executive the reasonable cost of membership (including
initiation fees and dues) in a private club selected by the Executive;
provided, however, that in the event that the Company terminates the Executive
for Cause or the Executive voluntarily terminates employment with the Company
without Good Reason prior to the fifth anniversary of the Effective Date, the
Executive shall return to the Company (and the Company shall be entitled to
withhold from any payment due the Executive with this Agreement or otherwise)
the amount equal to such club initiation fee, multiplied by a fraction, the
numerator of which is the number of whole calendar months remaining in the Term
of Employment as of the termination date and the denominator of which is 60.
5. Termination.
(a) Disability. In the event of the Disability of the
Executive during the Term of Employment, the Company shall have the right, upon
written notice to the Executive, to terminate the Executive's employment
hereunder, effective upon the 90th calendar day following the giving of such
notice (or such later day as shall be specified in such notice) unless prior to
such time the Executive shall have returned to the performance of his duties as
required hereunder. For purposes of this provision, "Disability" shall mean any
physical or mental disability or incapacity expected to be of long-continued or
indefinite duration which renders the Executive incapable of performing in all
material respects the essential functions of his regular duties and
responsibilities with the Company.
(b) Death. In the event of the death of the Executive
during the Term of Employment, this Agreement shall automatically terminate.
(c) Cause. The Company shall have the right, upon written
notice to the Executive, to terminate the Executive's employment under this
Agreement for Cause, in which case this Agreement shall terminate, and the
Executive shall be removed from office, effective as of the date specified by
the Company in the notice (subject to the Executive's right to correct any
conduct described in clause (iii) or (iv) of the definition of Cause below).
For purposes of this Agreement, the term "Cause"shall mean:
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(i) fraud or embezzlement on the part of the
Executive or material breach by the Executive of his obligations under Section
9 hereof; or
(ii) conviction of the Executive of any felony;
or
(iii) a material breach of, or the willful failure
or refusal by the Executive to perform and discharge, the Executive's duties,
responsibilities and obligations under this Agreement without Good Reason under
clause (i) or (ii) of the definition thereof; or
(iv) a material breach by the Executive of the
Company's Code of Conduct for Corporate Officers as in effect from time to
time; or
(v) any act of moral turpitude or willful
misconduct by the Executive intended to result in substantial personal
enrichment of the Executive at the expense of the Company or any of its
affiliates or which has a material adverse impact on the business or reputation
of the Company or any of its affiliates (such determination to be made by the
Board in its reasonable judgment).
For purposes of this provision, the Company shall be deemed to have Cause to
terminate the Executive's employment due to conduct described in clause (iii)
or (iv) above only if such conduct has not been corrected within 30 days of
written notice thereof to the Executive by the Company, such notice to state
with specificity the nature of the breach, failure or refusal; provided that if
such breach, failure or refusal cannot reasonably be corrected within 30 days
of written notice thereof, correction shall be commenced by the Executive
within such period and may be corrected within a reasonable period thereafter;
and, provided further that any such breach, failure or refusal by reason of
Disability (as defined in Section 5(a) hereof) or death shall not constitute
Cause for purposes hereof.
(d) Without Cause. The Company shall have the right to
terminate the Executive's employment under this Agreement without Cause at any
time during the Term of Employment, in which case Agreement shall terminate on
the date specified in such notice.
(e) Good Reason. The Executive shall have the right to
terminate his employment under this Agreement for Good Reason upon prior
written notice to the Company, in which case this Agreement shall terminate on
the date specified in such notice; provided that in the case of clause (i) or
(ii) of this Section 5(e), the date of termination specified in such notice
shall be at least thirty days after the delivery of such notice, in each such
case subject to the Company's right as provided below to remedy the event
giving rise to the termination prior to the date of termination specified in
such notice. For purposes of this Agreement, the term "Good Reason" shall mean:
(i) the assignment to the Executive of any
duties inconsistent in any material respect with the Executive's positions
(including status, offices, titles and reporting requirements), authority,
duties or responsibilities as contemplated by Section 3 of this Agreement,
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or any other action by the Company which results in a material diminishment in
such positions, authority, duties or responsibilities; or
(ii) any failure by the Company to comply with
any of the provisions of Section 4 of this Agreement, including any decrease in
bonus opportunity by reason of a change in employee group under the Company's
Senior Management Incentive Plan as in effect from time; or
(iii) any termination of the Executive's
employment by the Company otherwise than as permitted by this Agreement; or
(iv) any failure by any Successor (as such term
is defined in Section 15(b) hereof) of the Company to comply with this
Agreement; or
(v) the occurrence of a Change in Control of the
Company.
For purposes of this provision, the Executive shall be deemed to have Good
Reason to terminate his employment with the Company due to circumstances
described in paragraphs (i) or (ii) above only if such circumstances are not
corrected by the Company within 30 days of written notice thereof to the
Company by the Executive. "Change in Control" means the occurrence of any one
of the following events: (i) any person or other entity (other than a
subsidiary of the Company or the Executive or any of his affiliates as defined
in Rule 405 under the Securities Act of 1933), including any person as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934 (the "Exchange
Act"), becoming the beneficial owner, as defined in Rule 13d-3 of the Exchange
Act, directly or indirectly, of more than fifty percent (50%) of the total
combined voting power of all classes of capital stock of the Company ordinarily
entitled to vote for the election of directors of the Company, (ii) the Board
approving the sale of all or substantially all of the property or assets of the
Company, (iii) the Board approving a consolidation or merger of the Company
with another corporation (other than with any subsidiary of the Company or in
which the Company is the surviving corporation), the consummation of which
would result in the occurrence of an event described in clause (i) above, or
(iv) a change in the Board occurring with the result that the members of the
Board on the effective date hereof (the "Incumbent Directors") no longer
constitute a majority of such Board, provided that any person becoming a
director whose election or nomination for election was supported by a majority
of the Incumbent Directors shall be considered an Incumbent Director for
purposes hereof.
6. Obligations of the Company upon Termination.
(a) Termination by the Company Other Than for Cause or
Disability; Termination by the Executive for Good Reason. If, during the Term
of Employment, the Company terminates the Executive's employment other than for
Cause or Disability, or the Executive terminates employment for Good Reason
within a period of 90 days after the occurrence of the event giving rise to
Good Reason, then and, with respect to payments and benefits described in
clauses (i)(B), (i)(C) and (ii) below, only if the Executive executes a release
of all employment-related claims against the Company and its affiliates in a
form satisfactory to the Company:
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(i) the Company shall pay to the Executive the
following amounts:
(A) the sum of (1) the Executive's Base
Salary through the date of termination to the extent not theretofore paid, (2)
any annual bonus payable under Section 4(b), which has been earned but not
theretofore paid, (3) any accrued vacation pay to the extent not theretofore
paid, and (4) unless the Executive has elected a different payout date in a
prior deferral election, any compensation previously deferred by the Executive
(together with any accrued interest or earnings thereon) to the extent not
theretofore paid (the sum of the amounts described in clauses (1), (2), (3) and
(4) shall be hereinafter referred to as the "Accrued Obligations");
(B) the amount equal to the product of
(x) the Executive's annual Base Salary in effect as of the date of termination,
and (y) the number of whole and fractional years remaining in the Term of
Employment as of the date of termination; and
(C) the amount equal to the product of
(x) the amount of the target bonus applicable to the Executive under the MIP in
respect of the Company's fiscal year in which the date of termination occurs,
and (y) the number of years remaining in the Term of Employment as of the date
of termination (with any fractional years treated as whole years).
(ii) all outstanding unvested awards under the
Stock Bonus Plan, the Omnibus Plan and any other equity compensation plans of
the Company shall become immediately vested in full and, in the case of any
stock options or similar awards requiring exercise by the holder, shall become
immediately exercisable;
(iii) for the remaining Term of Employment, the
Company shall continue medical and dental benefits to the Executive and/or the
Executive's family at least equal to those which would have been provided to
them in accordance with the plans described in Section 4 of this Agreement if
the Executive's employment had not been terminated, which coverage shall be in
addition to and shall not reduce any continuation coverage required under the
Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA"); provided,
however, that such benefits shall cease if the Executive becomes eligible to
receive medical or dental benefits under the plan of another employer; and
(iv) to the extent not theretofore paid or
provided, the Company shall timely pay or provide to the Executive any other
amounts or benefits required to be paid or provided or which the Executive is
eligible to receive under any plan, program, policy or practice or contract or
agreement of the Company (such other amounts and benefits shall be hereinafter
referred to as the "Other Benefits").
The Company shall pay the amounts described in clause (i)(A) in a lump sum in
cash within 60 days of the date of the termination. The Company shall pay the
amounts described in clauses (i)(B) and (i)(C) on the dates such amounts would
have been paid if the Executive's employment with the Company had not
terminated; provided, however, that the Company shall discontinue such
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payments, and the Executive shall forfeit all rights to such amounts, if the
Executive becomes employed by a Competitor (as defined in Section 9(b)). With
respect to the medical and dental benefits described in clause (iii), the
Company may charge the Executive an amount equal to the applicable employee
premium for COBRA continuation coverage; provided, however, that in such event
the Company shall reimburse the amount of such premium to the Executive.
(v) The Company shall indemnify and hold the
Executive harmless from and against (i) the imposition of excise tax (the
"Excise Tax") under Section 4999 of the Internal Revenue Code of 1986, as
amended (the "Code"), on any payment made pursuant to this Section 5(e)
(including any payment made under this paragraph) or under any other plan,
arrangement or agreement of the Company, its successors, any person whose
actions result in a change of control of the Company or any person affiliated
with any of them (collectively referred to as the "Payments"), and (ii) any
federal, state or local income tax imposed on any payment made pursuant to this
paragraph. For the purposes of determining whether any of the Payments will be
subject to the Excise Tax and the amounts of such Excise Tax, independent tax
counsel, reasonably acceptable to the Executive, shall be selected by the
Company's independent auditors. For the purpose of determining the amount of
any payment under clause (ii) of the first sentence of this paragraph, the
Executive shall be deemed to pay federal income taxes at the highest marginal
rate of federal income taxation applicable to individuals in the calendar year
in which the indemnity payment is to be made and state and local income taxes
at the highest marginal rate of taxation applicable to individuals as are in
effect in the state and locality of the Executive's domicile for income tax
purposes in the calendar year in which such payment is to be made, net of the
maximum reduction in federal income taxes that could be obtained from deduction
of such state and local taxes.
(b) Death. If the Executive's employment is terminated by
reason of the Executive's death during the Term of Employment, this Agreement
shall terminate without further obligations to the Executive's legal
representatives under this Agreement, other than for payment of Accrued
Obligations, the timely payment or provision of Other Benefits, and payment of
an amount equal to the product of (x) the target MIP bonus applicable to the
Executive for the fiscal year in which the date of termination occurs, and (y)
a fraction, the numerator of which is the number of days in the fiscal year
through the date of termination and the denominator of which is 365 (the
"Prorated Bonus"). In addition, all outstanding unvested awards under the Stock
Bonus Plan, the Omnibus Plan and any other equity compensation plans of the
Company shall become immediately vested in full and, in the case of stock
options or similar awards requiring exercise by the holder, shall become
immediately exercisable. Accrued Obligations and the Prorated Bonus shall be
paid to the Executive's estate or beneficiary, as applicable, in a lump sum in
cash within 60 days of the date of termination. With respect to the provision
of Other Benefits, the term Other Benefits as used in this Section 6(b) shall
include, without limitation, and the Executive's estate and/or beneficiaries
shall be entitled to receive, benefits under such plans, programs, practices
and policies relating to death benefits, if any, as are applicable to the
Executive on the date of his death.
(c) Disability. If the Executive's employment is
terminated by reason of the Executive's Disability during the Term of
Employment, this Agreement shall terminate without
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further obligations to the Executive, other than for payment of Accrued
Obligations, payment of an amount equal to the Prorated Bonus described in
Section 6(b), and the timely payment or provision of Other Benefits. Accrued
Obligations and the Prorated Bonus shall be paid to the Executive in a lump sum
in cash within 60 days of the date of termination. In addition, for a period of
one year following the date of termination, the Company shall continue medical
and dental benefits to the Executive and/or the Executive's family on the same
basis set forth in Section 6(a). With respect to the provision of Other
Benefits, the term Other Benefits as used in this Section 6(c) shall include,
without limitation, and the Executive shall be entitled to receive, disability
and other benefits under such plans, programs, practices and policies relating
to disability, if any, as are applicable to the Executive and his family on the
date of termination.
(d) Cause or Voluntary Termination without Good Reason.
If the Executive's employment shall be terminated for Cause during the Term of
Employment, or if the Executive voluntarily terminates employment during the
Term of Employment without Good Reason, this Agreement shall terminate without
further obligations to the Executive, other than for payment of Accrued
Obligations and the timely payment or provision of Other Benefits.
7. Obligations of the Executive upon Termination.
(a) Termination by the Company Other Than for Cause or
Disability; Termination by the Executive for Good Reason. If, during the Term
of Employment, the Company terminates the Executive's employment other than for
Cause or Disability, or the Executive terminates employment for Good Reason
within 90 days after the occurrence of the event giving rise to Good Reason,
then the Executive shall have no further obligations hereunder.
(b) Other Termination of Employment. If, during the Term
of Employment, the Executive's employment with the Company terminates for any
reason other than the Employee's death or a termination described in Section
7(a), or if this Agreement expires on the third anniversary of notice by either
party pursuant to Section 2, then the Executive shall remain subject to the
provisions of Section 9.
(c) Mitigation. The Executive shall be under no
obligation to mitigate damages in order to receive any of the payments or
benefits described in Section 6.
8. Non-exclusivity of Rights. Nothing in this Agreement shall
prevent, limit or otherwise affect such rights as the Executive may have under
any other agreements with the Company. Amounts which are vested benefits or
which the Executive is otherwise entitled to receive under any plans or
programs of the Company at or subsequent to the Executive's date of termination
shall be payable in accordance with such plan or program; provided, however,
that payments made pursuant to Section 6(a) hereof shall be in lieu of any
severance payments under the Company's severance plans, if any, as in effect;
and provided further, that the Executive acknowledges that, upon request by the
Company, he shall immediately reimburse the Company for any amounts which the
Executive has received pursuant to any other severance plans of the
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Company, except that the Executive shall not be required to make any payment to
the Company until all obligations of the Company to the Executive hereunder
have been discharged.
9. Restrictions on Conduct of the Executive.
(a) General. The Executive and the Company understand and
agree that the purpose of the provisions of this Section 9 is to protect
legitimate business interests of the Company, as more fully described below,
and is not intended to eliminate the Executive's post-employment competition
with the Company per se, nor is it intended to impair or infringe upon the
Executive's right to work, earn a living, or acquire and possess property from
the fruits of his labor. The Executive hereby acknowledges that the
post-employment restrictions set forth in this Section 9 are reasonable and
that they do not, and will not, unduly impair his ability to earn a living
after the termination of this Agreement. Therefore, subject to the limitations
of reasonableness imposed by law, the Executive shall be subject to the
restrictions set forth in this Section 9.
(b) Definitions. The following capitalized terms used in
this Section 9 shall have the meanings assigned to them below, which
definitions shall apply to both the singular and plural forms of such terms:
"Competitive Position" means any employment with a
Competitor in which the Executive will use or is likely to use any Confidential
Information or Trade Secrets, or in which the Executive has duties for such
Competitor that relate to Competitive Services and that are the same or similar
to those services actually performed by the Executive for the Company;
"Competitive Services" means the manufacturing and
marketing of textile home fashion products.
"Competitor" means any Person engaged, wholly or in
part, in Competitive Services.
"Confidential Information" means all information
regarding the Company, its activities, business or clients that is the subject
of reasonable efforts by the Company to maintain its confidentiality and that
is not generally disclosed by practice or authority to persons not employed by
the Company, but that does not rise to the level of a Trade Secret.
"Confidential Information" shall include, but is not limited to, financial
plans and data concerning the Company; management planning information;
business plans; operational methods; market studies; marketing plans or
strategies; product development techniques or plans; customer lists; details of
customer contracts; current and anticipated customer requirements; past,
current and planned research and development; business acquisition plans; and
new personnel acquisition plans. "Confidential Information" shall not include
information that has become generally available to the public by the act of one
who has the right to disclose such information without violating any right or
privilege of the Company. This definition shall not limit any definition of
"confidential information" or any equivalent term under state or federal law.
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"Determination Date" means the date of termination of
the Executive's employment with the Company for any reason whatsoever or any
earlier date (during the Term of Employment) of an alleged breach of the
Restrictive Covenants by the Executive.
"Person" means any individual or any corporation,
partnership, joint venture, limited liability company, association or other
entity or enterprise.
"Principal or Representative" means a principal,
owner, partner, shareholder, joint venturer, investor, member, trustee,
director, officer, manager, employee, agent, representative or consultant.
"Protected Customers" means any Person to whom the
Company has sold its products or services or solicited to sell its products or
services during the twelve (12) months prior to the Determination Date.
"Protected Employees" means employees of the Company
who were employed by the Company at any time within six (6) months prior to the
Determination Date.
"Restricted Period" means the Term of Employment and
a period extending for one year from the termination of the Executive's
employment with the Company; provided, however, with respect to any Trade
Secret that constitutes a trade secret under Georgia law, the Restricted Period
shall be of unlimited duration.
"Restricted Territory" means the entire United
States.
"Restrictive Covenants" means the restrictive
covenants contained in Section 9(c) hereof.
"Trade Secrets" means all information, with regard to
form, including, but not limited to, technical or nontechnical data, a formula,
a pattern, a compilation, a program, a device, a method, a technique, a
drawing, a process, financial data, financial plans, product plans,
distribution lists or a list of actual or potential customers, advertisers or
suppliers which is not commonly known by or available to the public and which
information: (A) derives economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by proper means by,
other persons who can obtain economic value from its disclosure or use; and (B)
is the subject of efforts that are reasonable under the circumstances to
maintain its secrecy. Without limiting the foregoing, Trade Secret means any
item of Confidential Information that constitutes a "trade secret(s)" under the
common law or statutory law of the State of Georgia.
(c) Restrictive Covenants.
(i) Restriction on Disclosure and Use of
Confidential Information and Trade Secrets. The Executive understands and
agrees that the Confidential Information and Trade
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Secrets constitute valuable assets of the Company and its affiliated entities,
and may not be converted to the Executive's own use. Accordingly, the Executive
hereby agrees that the Executive shall not, directly or indirectly, at any time
during the Restricted Period reveal, divulge, or disclose to any Person not
expressly authorized by the Company any Confidential Information, and the
Executive shall not, directly or indirectly, at any time during the Restricted
Period use or make use of any Confidential Information in connection with any
business activity other than that of the Company. Throughout the term of this
Agreement and at all times after the date that this Agreement terminates for
any reason, the Executive shall not directly or indirectly transmit or disclose
any Trade Secret of the Company to any Person, and shall not make use of any
such Trade Secret, directly or indirectly, for himself or for others, without
the prior written consent of the Company. The parties acknowledge and agree
that this Agreement is not intended to, and does not, alter either the
Company's rights or the Executive's obligations under any state or federal
statutory or common law regarding trade secrets and unfair trade practices.
Anything herein to the contrary notwithstanding, the Executive shall
not be restricted from disclosing or using Confidential Information that is
required to be disclosed by law, court order or other legal process; provided,
however, that in the event disclosure is required by law, the Executive shall
provide the Company with prompt notice of such requirement so that the Company
may seek an appropriate protective order prior to any such required disclosure
by the Executive.
(ii) Nonsolicitation of Protected Employees. The
Executive understands and agrees that the relationship between the Company and
each of its Protected Employees constitutes a valuable asset of the Company and
may not be converted to the Executive's own use. Accordingly, the Executive
hereby agrees that during the Restricted Period the Executive shall not
directly or indirectly on the Executive's own behalf or as a Principal or
Representative of any Person or otherwise solicit or induce any Protected
Employee to terminate his or her employment relationship with the Company or to
enter into employment with any other Person.
(iii) Restriction on Relationships with Protected
Customers. The Executive understands and agrees that the relationship between
the Company and each of its Protected Customers constitutes a valuable asset of
the Company and may not be converted to the Executive's own use. Accordingly,
the Executive hereby agrees that, during the Restricted Period, the Executive
shall not, without the prior written consent of the Company, directly or
indirectly, on the Executive's own behalf or as a Principal or Representative
of any Person, solicit, divert, take away or attempt to solicit, divert or take
away a Protected Customer for the purpose of providing or selling Competitive
Services; provided, however, that the prohibition of this covenant shall apply
only to Protected Customers with whom the Executive had Material Contact on the
Company's behalf during the twelve (12) months immediately preceding the
termination of his employment hereunder. For purposes of this Agreement, the
Executive had "Material Contact" with a Protected Customer if (a) he had
business dealings with the Protected Customer on the Company's behalf; (b) he
was responsible for supervising or coordinating the dealings between the
Company and the Protected Customer; or (c) he obtained Trade Secrets or
Confidential Information about the customer as a result of his association with
the Company.
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(iv) Noncompetition with the Company. The
parties acknowledge: (A) that the Executive's services under this Agreement
require special expertise and talent in the provision of Competitive Services
and that the Executive will have substantial contacts with customers,
suppliers, advertisers and vendors of the Company; (B) that pursuant to this
Agreement, the Executive will be placed in a position of trust and
responsibility and he will have access to a substantial amount of Confidential
Information and Trade Secrets and that the Company is placing him in such
position and giving him access to such information in reliance upon his
agreement not to compete with the Company during the Restricted Period; (C)
that due to his management duties, the Executive will be the repository of a
substantial portion of the goodwill of the Company and would have an unfair
advantage in competing with the Company; (D) that due to the Executive's
special experience and talent, the loss of the Executive's services to the
Company under this Agreement cannot reasonably or adequately be compensated
with the Company; and (F) that the Executive is capable of obtaining gainful,
lucrative and desirable employment that does not violate the restrictions
contained in this Agreement. In consideration of the compensation and benefits
being paid and to be paid by the Company to the Executive hereunder, the
Executive hereby agrees that, during the Restricted Period, the Executive will
not, without prior written consent of the Company, directly or indirectly seek
or obtain a Competitive Position in the Restricted Territory with a Competitor;
provided, however, that the provisions of this Agreement shall not be deemed to
prohibit the ownership by the Executive of any securities of the Company or its
affiliated entities or not more than five percent (5%) of any class of
securities of any corporation having a class of securities registered pursuant
to the 1934 Act.
(d) Enforcement of Restrictive Covenants.
(i) Rights and Remedies Upon Breach. In the
event the Executive breaches, or threatens to commit a breach of, any of the
provisions of the Restrictive Covenants, the Company shall have the following
rights and remedies, which shall be independent of any others and severally
enforceable, and shall be in addition to, and not in lieu of, any other rights
and remedies available to the Company at law or in equity;
(A) the right and remedy to enjoin,
preliminarily and permanently, the Executive from violating or threatening to
violate the Restrictive Covenants and to have the Restrictive Covenants
specifically enforced by any court of competent jurisdiction, it being agreed
that any breach or threatened breach of the Restrictive Covenants would cause
irreparable injury to the Company and that money damages would not provide an
adequate remedy to the Company; and
(B) the right and remedy to require the
Executive to account for and pay over to the Company all compensation, profits,
monies, accruals, increments or other benefits derived or received by the
Executive as the result of any transactions constituting a breach of the
Restrictive Covenants.
(ii) Severability of Covenants. The Executive
acknowledges and agrees that the Restrictive Covenants are reasonable and valid
in time and scope and in all other respects.
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The covenants set forth in this Agreement shall be considered and construed as
separate and independent covenants. Should any part or provision of any
covenant be held invalid, void or unenforceable in any court of competent
jurisdiction, such invalidity, voidness or unenforceability shall not render
invalid, void or unenforceable any other part or provision of this Agreement.
If any portion of the foregoing provisions is found to be invalid or
unenforceable by a court of competent jurisdiction because its duration, the
territory, the definition of activities or the definition of information
covered is considered to be invalid or unreasonable in scope, the invalid or
unreasonable term shall be redefined, or a new enforceable term provided, such
that the intent of the Company and the Executive in agreeing to the provisions
of this Agreement will not be impaired and the provision in question shall be
enforceable to the fullest extent of the applicable laws.
10. Deductions and Withholding; Expenses. The Executive agrees
that the Company and/or its subsidiaries or affiliates shall withhold from any
and all compensation paid to and required to be paid to the Executive pursuant
to this Agreement, all federal, state, local and/or other taxes which the
Company determines are required to be withheld in accordance with applicable
statutes and/or regulations from time to time in effect and all amounts
required to be deducted in respect of the Executive's coverage under applicable
employee benefit plans. For purposes of this Agreement and calculations
hereunder, all such deductions and withholdings shall be deemed to have been
paid to and received by the Executive.
11. Entire Agreement. This Agreement embodies the entire
agreement of the parties with respect to the Executive's employment. This
Agreement may not be changed or terminated orally but only by an agreement in
writing signed by the parties hereto.
12. Waiver. The waiver by the Company of a breach of any
provision of this Agreement by the Executive shall not operate or be construed
as a waiver of any subsequent breach by him. The waiver by the Executive of a
breach of any provision of this Agreement by the Company shall not operate or
be construed as a waiver of any subsequent breach by the Company.
13. Governing Law. This Agreement shall be subject to, and
governed by, the laws of the State of Georgia, without regard to choice of law
principles.
14. Dispute Resolution. Except as necessary to specifically
enforce, or enjoin the breach of this Agreement or any provision herein (to the
extent such remedies may otherwise be available), any dispute arising out of or
relating to this Agreement shall be submitted to binding arbitration by one
arbiter under the then existing Commercial Arbitration Rules of the American
Arbitration Association in arbitration proceedings conducted in Atlanta,
Georgia. The arbiter shall have no power or authority in making his award to
modify, enlarge or add to the terms and provisions of this Agreement, except as
otherwise expressly agreed herein. The arbiter shall provide the parties a
draft of the tentative award and the reasons therefor and permit them to submit
briefs supporting or challenging the tentative award. Judgment upon the final
award of the arbiter shall be binding upon the parties and may be entered in
any court having jurisdiction. INITIALED: /s/ HTG
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15. Assignability; Successors. (a) The obligations of the
Executive may not be delegated and, except as expressly provided in Section
6(b) relating to beneficiaries, the Executive may not, without the Company's
written consent thereto, assign, transfer, convey, pledge, encumber,
hypothecate or otherwise dispose of this Agreement or any interest herein. Any
such attempted delegation or disposition shall be null and void and without
effect.
(b) The Company and the Executive agree that this
Agreement and each of the Company's rights and obligations hereunder may be
assigned or transferred by the Company to and shall be assumed by and binding
upon any corporation or other business entity which succeeds to the assets or
conducts the business of the Company, whether directly or indirectly, by
purchase, merger, consolidation or otherwise (a "Successor"). In the event that
another corporation or other business entity becomes a Successor of the
Company, then the Successor shall, by an agreement in form and substance
reasonably satisfactory to the Executive, expressly 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 there had been no Successor.
16. Notices. All notices to the Company or the Executive permitted
or required hereunder shall be in writing, shall refer to this Agreement and
shall be delivered personally, by telecopier or by courier service providing
for next-day delivery or sent by registered or certified mail, return receipt
requested; to the following addresses:
The Company:
WestPoint Stevens Inc.
507 West Tenth Street
West Point, Georgia 31833
Attn: M. Clayton Humphries, Jr.
General Counsel
with a copy to:
Mazursky & Dunaway, LLP
Promenade Two, Suite 2440
1230 Peachtree Street
Atlanta, Georgia 30309
Attn: C. Glenn Dunaway, Esq.
The Executive:
Holcombe T. Green, Jr.
3655 Tuxedo Road
Atlanta, Georgia 30305
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Any party may change the address to which notices shall be sent by sending
written notice of such change of address to the other party. Any such notice
shall be deemed given, if delivered personally, upon receipt; if sent by
certified or registered mail, 3 days after deposit (postage prepaid) with the
U.S. mail service; if sent by courier service providing for next day delivery,
the next business day following deposit with such courier service; and if
telecopied, when telecopied.
17. Effective Date. This Agreement shall be effective as of the
date first written above.
18. Paragraph Headings. The paragraph headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
19. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
taken together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement in Atlanta, Georgia as of the date first above written.
WESTPOINT STEVENS INC.
By: /s/ Thomas J. Ward
-------------------------------------
Thomas J. Ward
President and Chief Operating Officer
/s/ Holcombe T. Green, Jr.
---------------------------------
Holcombe T. Green, Jr.
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