Exhibit 10(b)
EMPLOYMENT AGREEMENT
AGREEMENT by and between ▇▇▇▇▇ River Corporation of
Virginia, a Virginia corporation (the "Company") and [NAME]
(the "Executive"), dated as of the 22 day of August, 1996.
1. Certain Definitions. The "Effective Date"
shall mean the first date after the date hereof on which a
Change of Control (as defined in Section 2) occurs.
Anything in this Agreement to the contrary notwithstanding,
if a Change of Control occurs and if the Executive's
employment with the Company is terminated prior to the date
on which the Change of Control occurs, and if it is
reasonably demonstrated by the Executive that such termi
nation of employment (i) was at the request of a third party
who has taken steps reasonably calculated to effect a Change
of Control or (ii) otherwise arose in connection with or an
ticipation of a Change of Control, then for all purposes of
this Agreement the "Effective Date" shall mean the date im
mediately prior to the date of such termination of employ
ment.
2. Change of Control. For the purpose of this
Agreement, a "Change of Control" shall mean:
(a) 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 "Ex
change Act") (a "Person") of beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the Exchange
Act) of 20% or more of either (i) the then outstanding
shares of common stock of the Company (the "Outstanding
Company Common Stock") or (ii) the combined voting power of
the then outstanding voting securities of the Company
entitled to vote generally in the election of directors (the
"Outstanding Company Voting Securities"); provided, however,
that for purposes of this subsection (a), the following
acquisitions shall not constitute a Change of Control: (i)
any acquisition directly from the Company, (ii) any
acquisition by the Company, (iii) any acquisition by any
employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by
the Company or (iv) any acquisition by any corporation pursu
ant to a transaction which complies with clauses (i), (ii)
and (iii) of subsection (c) of this Section 2; or
E-2
(b) Individuals who, as of the date hereof, consti
tute 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 Company's shareholders, 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 exclud
ing, 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 solicita
tion of proxies or consents by or on behalf of a Person
other than the Board; or
(c) Consummation of a reorganization, merger or
consolidation or sale or other disposition of all or substan
tially all of the assets of the Company (a "Business Combina
tion"), in each case, unless, following such Business Combi
nation, (i) all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of
the Outstanding Company Common Stock and Outstanding Company
Voting Securities immediately prior to such Business Combina
tion beneficially own, directly or indirectly, more than 50%
of, respectively, the then outstanding shares of common
stock and the combined voting power 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 Company or all or substantially all of
the Company'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 Company Common Stock and Outstanding Company
Voting Securities, as the case may be, (ii) no Person
(excluding any employee benefit plan (or related trust) of
the Company or such corporation resulting from such Business
Combination) beneficially owns, directly or indirectly, 20%
or more of, respectively, the then outstanding shares of com
mon 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 (iii) 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
(d) Approval by the shareholders of the Company of
a complete liquidation or dissolution of the Company.
3. Employment Period. The Company hereby agrees
to continue the Executive in its employ, and the Executive
hereby agrees to remain in the employ of the Company subject
to the terms and conditions of this Agreement, for the
period commencing on the date hereof and ending on the third
anniversary of such date (the "Employment Period");
provided, however, that commencing on the date one year
after the date hereof, and on each annual anniversary of
such date (such date and each annual anniversary thereof
shall be hereinafter referred to as the "Renewal Date"), un
less previously terminated, the Employment Period shall be
automatically extended so as to terminate three years from
such Renewal Date, unless at least 60 days prior to the
Renewal Date the Company shall give notice to the Executive
that the Employment Period shall not be so extended,
provided, further, however, that upon a Change of Control,
if the Executive is still employed by the Company, the
Employment Period shall be extended until the third
anniversary of the Effective Date, or if the Employment
Period has terminated prior to the Change of Control, a new
two year Employment Period shall commence upon a Change of
Control.
4. Terms of Employment. (a) Position and Duties.
(i) During the Employment Period, the Executive shall be
[POSITION] and shall have such duties, responsibilities and
authority as shall be consistent therewith.
(ii) During the Employment Period, and exclud
ing any periods of vacation and sick leave to which the Ex
ecutive is entitled, the Executive agrees to devote full at
tention and time during normal business hours to the
business and affairs of the Company and to use the
Executive's reasonable best efforts to perform faithfully
and efficiently such responsibilities. During the
Employment Period it shall not be a violation of this
Agreement for the Executive to (A) serve on corporate, civic
or charitable boards or committees, (B) deliver lectures,
fulfill speaking engagements or teach at educational
institutions and (C) manage personal investments, so long as
such activities do not significantly interfere with the
performance of the Executive's responsibilities as an
employee of the Company in accordance with this Agreement.
It is expressly understood and agreed that to the extent
that any such activities have been conducted by the Ex
ecutive prior to the Effective Date, the continued conduct
of such activities (or the conduct of activities similar in
nature and scope thereto) subsequent to the Effective Date
shall not thereafter be deemed to interfere with the perfor
▇▇▇▇▇ of the Executive's responsibilities to the Company.
(b) Compensation. (i) Base Salary. During the
Employment Period, the Executive shall receive an annual
base salary ("Annual Base Salary") of not less than
[SALARY]. The Annual Base Salary shall be paid in equal bi-
weekly installments. During the Employment Period, the
Annual Base Salary shall be reviewed at least every 12
months. Any increase in Annual Base Salary shall not serve
to limit or reduce any other obligation to the Executive
under this Agreement. Annual Base Salary shall not be
reduced after any such increase and the term Annual Base
Salary as utilized in this Agreement shall refer to Annual
Base Salary as so increased.
(ii) Annual Bonus. In addition to Annual
Base Salary, the Executive shall be awarded, for each fiscal
year ending during the Employment Period, an annual bonus
(the "Annual Bonus") pursuant to the Company's Management
Incentive Plan, pro rated in the case of a bonus for any
year during which the Executive was employed for less than
12 months; provided, however, after the Effective Date, the
Annual Bonus shall be no less than the Executive's Target
Bonus under the Management Incentive Plan for the year prior
to the year in which the Change of Control occurs (the
"Minimum Bonus"). Each such Annual Bonus shall be paid no
later than the end of the third month of the fiscal year
next following the fiscal year for which the Annual Bonus is
awarded, unless the Executive shall elect to defer the
receipt of such Annual Bonus.
(iii) Incentive, Savings and Retirement
Plans. During the Employment Period, the Executive shall be
eligible to participate in all incentive, savings and
retirement plans, practices, policies and programs
applicable generally to other peer executives of the Company
and its affiliated companies, provided further that after
the Effective Date in no event shall such plans, practices,
policies and programs provide the Executive with incentive
opportunities (measured with respect to both regular and spe
cial incentive opportunities, to the extent, if any, that
such distinction is applicable), savings opportunities and
retirement benefit opportunities, in each case, less favor
able, in the aggregate, than the most favorable of those pro
vided by the Company and its affiliated companies for the
Executive under such plans, practices, policies and programs
as in effect at any time during the 120-day period immedi
ately preceding the Effective Date or if more favorable to
the Executive, those provided generally at any time after
the Effective Date to other peer executives of the Company
and its affiliated companies, after taking into account the
difference in age between the Executive and the peer
executives.
(iv) Welfare Benefit Plans. During the Em
ployment Period, the Executive and/or the Executive's fam
ily, as the case may be, shall be eligible for participation
in and shall receive all benefits under welfare benefit
plans, practices, policies and programs provided by the
Company and its affiliated companies (including, without
limitation, medical, prescription, dental, disability, em
ployee life, group life, accidental death and travel
accident insurance plans and programs) to the extent
applicable generally to other peer executives of the Company
and its affiliated companies, provided that after the
Effective Date in no event shall such plans, practices,
policies and programs provide the Executive with benefits
which are less favorable, in the aggregate, than the most
favorable of such plans, practices, policies and programs in
effect for the Executive at any time during the 120-day
period immediately preceding the Effective Date or, if more
favorable to the Executive, those provided generally at any
time after the Effective Date to other peer executives of
the Company and its affiliated companies.
(v) Expenses. During the Employment Period,
the Executive shall be entitled to receive prompt reimburse
ment for all reasonable business expenses incurred by the
Executive.
(vi) Fringe Benefits. During the Employment
Period, the Executive shall be entitled to fringe benefits,
including, without limitation, tax and financial planning
services, payment of club dues, and an automobile of his
choice and payment of related expenses.
(vii) Vacation. During the Employment Pe
riod, the Executive shall be entitled to paid vacation in ac
cordance with the Vacation Policy as set forth in the
Company's Benefits and Policies Manual, but in no event less
than four weeks per year, as defined in the Benefits and
Policies Manual.
5. Termination of Employment. (a) Death or Dis
ability. The Executive's employment shall terminate auto
matically upon the Executive's death during the Employment
Period. If the Company determines in good faith that the
Disability of the Executive has occurred during the Employ
ment Period (pursuant to the definition of Disability set
forth below), it may give to the Executive written notice in
accordance with Section 12(b) of this Agreement of its inten
tion to terminate the Executive's employment. In such
event, the Executive's employment with the Company shall
terminate effective on the 30th day after receipt of such
notice by the Executive (the "Disability Effective Date"),
provided that, within the 30 days after such receipt, the
Executive shall not have returned to full-time performance
of the Executive's duties. For purposes of this Agreement,
"Disability" shall mean the absence of the Executive from
the Executive's duties with the Company on a full-time basis
for 180 consecutive business days as a result of incapacity
due to mental or physical illness which is determined to be
total and permanent by a physician selected by the Company
or its insurers and acceptable to the Executive or the
Executive's legal representative.
(b) Cause. The Company may terminate the Execu
tive's employment during the Employment Period for Cause.
For purposes of this Agreement, "Cause" shall mean:
(i) the willful and continued failure of the Ex
ecutive to perform substantially the Executive's duties
with the Company or one of its affiliates (other than
any such failure resulting from incapacity due to
physical or mental illness), after a written demand for
substantial performance is delivered to the Executive by
the Board or the Chief Executive Officer of the Company
which specifically identifies the manner in which the
Board or Chief Executive Officer believes that the
Executive has not substantially performed the
Executive's duties, or
(ii) the willful engaging by the Executive in il
legal conduct or gross misconduct which is materially
and demonstrably injurious to the Company.
For purposes of this provision, no act or failure to act, on
the part of the Executive, shall be considered "willful" un
less it is done, or omitted to be done, by the Executive in
bad faith or without reasonable belief that the Executive's
action or omission was in the best interests of the Company.
Any act, or failure to act, based upon authority given pur
suant to a resolution duly adopted by the Board or based
upon the advice of counsel for the Company shall be
conclusively presumed to be done, or omitted to be done, by
the Executive in good faith and in the best interests of the
Company. The cessation of employment of the Executive shall
not be deemed to be for Cause unless and until there shall
have been delivered to the Executive a copy of a resolution
duly adopted by the affirmative vote of a majority of the
entire membership of the Board at a meeting of the Board
called and held for such purpose (after reasonable notice is
provided to the Executive and the Executive is given an
opportunity, together with counsel, to be heard before the
Board), finding that, in the good faith opinion of the
Board, the Executive is guilty of the conduct described in
subparagraph (i) or (ii) above, and specifying the
particulars thereof in detail.
(c) Good Reason. The Executive's employment may
be terminated by the Executive for Good Reason. For
purposes of this Agreement, "Good Reason" shall mean:
(i) the assignment to the Executive of any duties
inconsistent with the Executive's position (including
status, offices, titles and reporting requirements), au
thority, duties or responsibilities as contemplated by
Section 4(a) of this Agreement, or any other action by
the Company which results in a diminution in such posi
tion, authority, duties or responsibilities, excluding
for this purpose an isolated, insubstantial and inadvert
ent action not taken in bad faith and which is remedied
by the Company promptly after receipt of notice thereof
given by the Executive;
(ii) any failure by the Company to comply with
any of the provisions of Section 4(b) of this Agreement,
other than an isolated, insubstantial and inadvertent
failure not occurring in bad faith and which is remedied
by the Company promptly after receipt of notice thereof
given by the Executive;
(iii) the Company's requiring the Executive to be
based at any office or location after the Effective Date
other than where the Executive was located immediately
prior to the Effective Date other than in connection
with a change of the Company's headquarters if the
Executive is relocated to such headquarters, or, after
the Effective Date, the Company's requiring the
Executive to travel on Company business to a substan
tially greater extent than required immediately prior to
the Effective Date;
(iv) any purported termination by the Company of
the Executive's employment otherwise than as expressly
permitted by this Agreement; or
(v) any failure by the Company to comply with and
satisfy Section 11(c) of this Agreement.
For purposes of this Section 5(c), after the Effective Date,
any good faith determination of "Good Reason" made by the
Executive shall be conclusive. Anything in this Agreement
to the contrary notwithstanding, a termination by the
Executive for any reason during the 30-day period
immediately following the first anniversary of the Effective
Date shall be deemed to be a termination for Good Reason for
all purposes of this Agreement.
(d) Notice of Termination. Any termination by the
Company for Cause, or by the Executive for Good Reason,
shall be communicated by Notice of Termination to the other
party hereto given in accordance with Section 12(b) of this
Agreement. For purposes of this Agreement, a "Notice of
Termination" means a written notice which (i) indicates the
specific termination provision in this Agreement relied
upon, (ii) to the extent applicable, sets forth in
reasonable detail the facts and circumstances claimed to
provide a basis for termination of the Executive's
employment under the provision so indicated and (iii) if the
Date of Termination (as defined below) is other than the
date of receipt of such notice, specifies the termination
date (which date shall be not more than thirty days after
the giving of such notice). The failure by the Executive or
the Company to set forth in the Notice of Termination any
fact or circumstance which contributes to a showing of Good
Reason or Cause shall not waive any right of the Executive
or the Company, respectively, hereunder or preclude the
Executive or the Company, respectively, from asserting such
fact or circumstance in enforcing the Executive's or the
Company's rights hereunder.
(e) Date of Termination. "Date of Termination"
means (i) if the Executive's employment is terminated by the
Company for Cause, or by the Executive for Good Reason, the
date of receipt of the Notice of Termination or any later
date specified therein, as the case may be, (ii) if the
Executive's employment is terminated by the Company other
than for Cause or Disability, the Date of Termination shall
be the date on which the Company notifies the Executive of
such termination and (iii) if the Executive's employment is
terminated by reason of death or Disability, the Date of Ter
mination shall be the date of death of the Executive or the
Disability Effective Date, as the case may be.
6. Obligations of the Company upon Termination and
Change of Control. (a) Good Reason; Other Than for Cause,
Death or Disability. If, during the Employment Period, the
Company shall terminate the Executive's employment other
than for Cause or Disability or the Executive shall
terminate employment for Good Reason:
(i) the Company shall pay to the Executive in a
lump sum in cash within 30 days after the Date of Termi
nation the aggregate of the following amounts:
A. the sum of (1) the Executive's Annual Base
Salary through the Date of Termination to the
extent not theretofore paid, (2) the product of (x)
the Minimum Bonus and (y) a fraction, the numerator
of which is the number of days in the current
fiscal year through the Date of Termination, and
the denominator of which is 365 and (3) any
compensation previously deferred by the Executive
(together with any accrued interest or earnings
thereon) and any accrued vacation pay, in each case
to the extent not theretofore paid (the sum of the
amounts described in clauses (1), (2), and (3)
shall be hereinafter referred to as the "Accrued
Obligations"); and
B. the amount equal to the product of (1)
three, if the Date of Termination occurs on or
after the Effective Date, and two, if the Date of
Termination occurs before the Effective Date, and
(2) the sum of (x) the Executive's Annual Base
Salary and (y) the Minimum Bonus; and
C. if the Date of Termination occurs on or
after the Effective Date, an amount equal to the
excess of (a) the actuarial equivalent of the ben
efit under the Company's qualified defined benefit
retirement plan (the "Retirement Plan") (utilizing
actuarial assumptions no less favorable to the Ex
ecutive than those in effect under the Company's Re
tirement Plan immediately prior to the Effective
Date), and any excess or supplemental retirement
plan in which the Executive participates (together,
the "SERP") which the Executive would receive if
the Executive's employment continued for three
years after the Date of Termination assuming for
this purpose that all accrued benefits are fully
vested, and, assuming that the Executive's
compensation in each of the three years is that
required by Section 4(b)(i) and Section 4(b)(ii),
over (b) the actuarial equivalent of the
Executive's actual benefit (paid or payable), if
any, under the Retirement Plan and the SERP as of
the Date of Termination;
(ii) for three years, if the Date of Termination
occurs on or after the Effective Date, or two years, if
the Date of Termination occurs before the Effective Date
(in each case, the "Separation Period") after the
Executive's Date of Termination, or such longer period
as may be provided by the terms of the appropriate plan,
program, practice or policy, the Company shall continue
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, programs,
practices and policies described in Section 4(b)(iv) of
this Agreement if the Executive's employment had not
been terminated or, if more favorable to the Executive,
as in effect generally at any time thereafter with re
spect to other peer executives of the Company and its
affiliated companies and their families, provided, how
ever, that if the Executive becomes reemployed with an
other employer and is eligible to receive medical or
other welfare benefits under another employer provided
plan, the medical and other welfare benefits described
herein shall be secondary to those provided under such
other plan during such applicable period of eligibility.
For purposes of determining eligibility (but not the
time of commencement of benefits) of the Executive for
retiree benefits pursuant to such plans, practices,
programs and policies, the Executive shall be considered
to have remained employed during the Separation Period
and to have retired on the last day of such period;
(iii) the Company shall deliver to the Executive
free and clear title to the Company car;
(iv) to the extent not theretofore paid or pro
vided, 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 entitled to
receive under any plan, program, policy or practice or
contract or agreement of the Company and its affiliated
companies (such other amounts and benefits shall be here
inafter referred to as the "Other Benefits").
(b) Death. If the Executive's employment is termi
nated by reason of the Executive's death during the Employ
ment Period, this Agreement shall terminate without further
obligations to the Executive's legal representatives under
this Agreement, other than for payment of Accrued
Obligations and the timely payment or provision of Other
Benefits. Accrued Obligations shall be paid to the
Executive's estate or beneficiary, as applicable, in a lump
sum in cash within 30 days of the Date of Termination. With
respect to the provision of Other Benefits after the
Effective Date, the term Other Benefits as utilized in this
Section 6(b) shall include, without limitation, and the
Executive's estate and/or beneficiaries shall be entitled to
receive, benefits at least equal to the most favorable
benefits provided by the Company and affiliated companies to
the estates and beneficiaries of peer executives of the
Company and such affiliated companies under such plans,
programs, practices and policies relating to death benefits,
if any, as in effect with respect to other peer executives
and their beneficiaries at any time during the 120-day
period immediately preceding the Effective Date or, if more
favorable to the Executive's estate and/or the Executive's
beneficiaries, as in effect on the date of the Executive's
death with respect to other peer executives of the Company
and its affiliated companies and their beneficiaries.
(c) Disability. If the Executive's employment is
terminated by reason of the Executive's Disability during
the Employment Period, 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. Accrued Obligations shall be
paid to the Executive in a lump sum in cash within 30 days
of the Date of Termination. With respect to the provision
of Other Benefits after the Effective Date, the term Other
Benefits as utilized in this Section 6(c) shall include, and
the Executive shall be entitled after the Disability
Effective Date to receive, disability and other benefits at
least equal to the most favorable of those generally
provided by the Company and its affiliated companies to
disabled executives and/or their families in accordance with
such plans, programs, practices and policies relating to dis
ability, if any, as in effect generally with respect to
other peer executives and their families at any time during
the 120-day period immediately preceding the Effective Date
or, if more favorable to the Executive and/or the
Executive's family, as in effect at any time thereafter
generally with respect to other peer executives of the
Company and its affiliated companies and their families.
(d) Cause; Other than for Good Reason. If the
Executive's employment shall be terminated for Cause during
the Employment Period, this Agreement shall terminate
without further obligations to the Executive other than the
obligation to pay to the Executive (x) his Annual Base
Salary through the Date of Termination, (y) the amount of
any compensation previously deferred by the Executive, and
(z) Other Benefits, in each case to the extent theretofore
unpaid. If the Executive voluntarily terminates employment
during the Employment Period, excluding a termination for
Good Reason, this Agreement shall terminate without further
obligations to the Executive, other than for Accrued Obliga
tions and the timely payment or provision of Other Benefits.
In such case, all Accrued Obligations shall be paid to the
Executive in a lump sum in cash within 30 days of the Date
of Termination. Upon a termination of the Executive's
employment for Cause by the Company or by the Executive
without Good Reason, the Executive shall forfeit all stock
options that are not vested on the Date of Termination.
(e) Change of Control. Upon a Change of Control,
all stock options, restricted stock and other stock incen
tives held by the Executive shall vest and be immediately
exercisable. Within 10 days after a Change of Control, the
Company shall pay the Executive in a lump sum in cash all
nonqualified benefit plan balances and other deferred
amounts.
7. Non-exclusivity of Rights. Nothing in this
Agreement shall prevent or limit the Executive's continuing
or future participation in any plan, program, policy or prac
▇▇▇▇ provided by the Company or any of its affiliated compa
▇▇▇▇ and for which the Executive may qualify nor shall any
thing herein limit or otherwise affect such rights as the
Executive may have under any contract or agreement with the
Company or any of its affiliated companies. Amounts which
are vested benefits or which the Executive is otherwise en
titled to receive under any plan, policy, practice or
program of or any contract or agreement with the Company or
any of its affiliated companies at or subsequent to the Date
of Termination shall be payable in accordance with such
plan, policy, practice or program or contract or agreement
except as explicitly modified by this Agreement.
8. Full Settlement. The Company's obligation to
make the payments provided for in this Agreement and other
wise to perform its obligations hereunder shall not be af
fected by any set-off, counterclaim, recoupment, defense or
other claim, right or action which the Company may have
against the Executive or others. In no event shall the Ex
ecutive be obligated to seek other employment or take any
other action by way of mitigation of the amounts payable to
the Executive under any of the provisions of this Agreement
and such amounts shall not be reduced whether or not the Ex
ecutive obtains other employment. The Company agrees to pay
as incurred, to the full extent permitted by law, all legal
fees and expenses which the Executive may reasonably incur
as a result of any contest (regardless of the outcome
thereof) by the Company, the Executive or others of the
validity or enforceability of, or liability under, any provi
sion of this Agreement or any guarantee of performance
thereof (including as a result of any contest by the Execu
tive about the amount of any payment pursuant to this Agree
ment), plus in each case interest on any delayed payment at
the applicable Federal rate provided for in Section
7872(f)(2)(A) of the Internal Revenue Code of 1986, as
amended (the "Code"); provided that the Company shall have
no such obligation if it is determined by a court that the
Company was not in breach of the Agreement and that the
Executive's claims were not made in good faith.
9. Certain Additional Payments by the Company.
(a) Anything in this Agreement to the contrary not
withstanding, in the event it shall be determined that any
payment or distribution by the Company to or for the benefit
of the Executive (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or oth
erwise, but determined without regard to any additional pay
ments required under this Section 9) (a "Payment") would be
subject to the excise tax imposed by Section 4999 of the
Code or any interest or penalties are incurred by the Execu
tive with respect to such excise tax (such excise tax,
together with any such interest and penalties, are herein
after collectively referred to as the "Excise Tax"), then
the Executive shall be entitled to receive an additional
payment (a "Gross-Up Payment") in an amount such that after
payment by the Executive of all taxes and any benefits that
result from the deductibility by the Executive of such taxes
(including, in each case, any interest or penalties imposed
with respect to such taxes), including, without limitation,
any income taxes (and any interest and penalties imposed
with respect thereto) and Excise Tax imposed upon the
Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the
Payments.
(b) Subject to the provisions of Section 9(c), all
determinations required to be made under this Section 9, in
cluding whether and when a Gross-Up Payment is required and
the amount of such Gross-Up Payment and the assumptions to
be utilized in arriving at such determination, shall be made
by Coopers & ▇▇▇▇▇▇▇ LLP or such other certified public ac-
counting firm as may be designated by the Executive (the "Ac
counting Firm") which shall provide detailed supporting
calculations both to the Company and the Executive within 15
business days of the receipt of notice from the Executive
that there has been a Payment, or such earlier time as is re
quested by the Company. In the event that the Accounting
Firm is serving as accountant or auditor for the individual,
entity or group effecting the Change of Control, the Execu
tive shall appoint another nationally recognized accounting
firm to make the determinations required hereunder (which
accounting firm shall then be referred to as the Accounting
Firm hereunder). All fees and expenses of the Accounting
Firm shall be borne solely by the Company. Any Gross-Up Pay
ment, as determined pursuant to this Section 9, shall be
paid by the Company to the Executive within five days of the
receipt of the Accounting Firm's determination. Any
determination by the Accounting Firm shall be binding upon
the Company and the Executive. As a result of the
uncertainty in the application of Section 4999 of the Code
at the time of the initial determination by the Accounting
Firm hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been made
("Underpayment"), consistent with the calculations required
to be made hereunder. In the event that the Company
exhausts its remedies pursuant to Section 9(c) and the
Executive thereafter is required to make a payment of any
Excise Tax, the Accounting Firm shall determine the amount
of the Underpayment that has occurred and any such
Underpayment shall be promptly paid by the Company to or for
the benefit of the Executive.
(c) The Executive shall notify the Company in writ
ing of any claim by the Internal Revenue Service that, if
successful, would require the payment by the Company of the
Gross-Up Payment. Such notification shall be given as soon
as practicable but no later than ten business days after the
Executive is informed in writing of such claim and shall ap
prise the Company of the nature of such claim and the date
on which such claim is requested to be paid. The Executive
shall not pay such claim prior to the expiration of the
30-day period following the date on which it gives such no
▇▇▇▇ to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such claim is
due). If the Company notifies the Executive in writing
prior to the expiration of such period that it desires to
contest such claim, the Executive shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim,
(ii) take such action in connection with contesting
such claim as the Company shall reasonably request in
writing from time to time, including, without
limitation, accepting legal representation with respect
to such claim by an attorney reasonably selected by the
Company,
(iii) cooperate with the Company in good faith in
order effectively to contest such claim, and
(iv) permit the Company to participate in any pro
ceedings relating to such claim;
provided, however, that the Company shall bear and pay di
rectly all costs and expenses (including additional interest
and penalties) incurred in connection with such contest and
shall indemnify and hold the Executive harmless, on an
after-tax basis, for any Excise Tax or income tax (including
interest and penalties with respect thereto) imposed as a
result of such representation and payment of costs and ex
penses. Without limitation on the foregoing provisions of
this Section 9(c), the Company shall control all proceedings
taken in connection with such contest and, at its sole op
tion, may pursue or forgo any and all administrative
appeals, proceedings, hearings and conferences with the
taxing authority in respect of such claim and may, at its
sole option, either direct the Executive to pay the tax
claimed and ▇▇▇ for a refund or contest the claim in any
permissible manner, and the Executive agrees to prosecute
such contest to a determination before any administrative
tribunal, in a court of initial jurisdiction and in one or
more appellate courts, as the Company shall determine;
provided, however, that if the Company directs the Executive
to pay such claim and ▇▇▇ for a refund, the Company shall
advance the amount of such payment to the Executive, on an
interest-free basis and shall indemnify and hold the Execu
tive harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties with respect
thereto) imposed with respect to such advance or with
respect to any imputed income with respect to such advance;
and further provided that any extension of the statute of
limitations relating to payment of taxes for the taxable
year of the Executive with respect to which such contested
amount is claimed to be due is limited solely to such
contested amount. Furthermore, the Company's control of the
contest shall be limited to issues with respect to which a
Gross-Up Payment would be payable hereunder and the
Executive shall be entitled to settle or contest, as the
case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority.
(d) If, after the receipt by the Executive of an
amount advanced by the Company pursuant to Section 9(a) or
9(c), the Executive becomes entitled to receive any refund
with respect to such claim, the Executive shall (subject to
the Company's complying with the requirements of
Section 9(c)) promptly pay to the Company the amount of such
refund (together with any interest paid or credited thereon
after taxes applicable thereto). If, after the receipt by
the Executive of an amount advanced by the Company pursuant
to Section 9(c), a determination is made that the Executive
shall not be entitled to any refund with respect to such
claim and the Company does not notify the Executive in writ
ing of its intent to contest such denial of refund prior to
the expiration of 30 days after such determination, then
such advance shall be forgiven and shall not be required to
be repaid and the amount of such advance shall offset, to
the extent thereof, the amount of Gross-Up Payment required
to be paid.
10. Confidential Information/Noncompetition. (a)
The Executive shall hold in a fiduciary capacity for the ben
efit of the Company all secret or confidential information,
knowledge or data relating to the Company or any of its af
filiated companies, and their respective businesses, which
shall have been obtained by the Executive during the
Executive's employment by the Company or any of its affili
ated companies and which shall not be or become public knowl
edge (other than by acts by the Executive or representatives
of the Executive in violation of this Agreement). After ter
mination of the Executive's employment with the Company, the
Executive shall not, without the prior written consent of
the Company or as may otherwise be required by law or legal
process, communicate or divulge any such information,
knowledge or data to anyone other than the Company and those
designated by it.
(b) In the event of a termination of the
Executive's employment prior to a Change of Control, until
the second anniversary of the Executive's Date of
Termination, the Executive will not directly or indirectly,
own, manage, operate, control or participate in the
ownership, management, operation or control of, or be
connected as an officer, employee, partner, director or
otherwise with, or have any financial interest in, any
business which is in competition with the Company or any of
its affiliates in any geographic area where such business is
being conducted during such period. Ownership, for personal
investment purposes only of not in excess of 2% of the
voting stock of any publicly held corporation shall not con
stitute a violation hereof.
11. Successors. (a) This Agreement is personal
to the Executive and without the prior written consent of
the Company shall not be assignable by the Executive
otherwise than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of
and be enforceable by the Executive's legal representatives.
(b) This Agreement shall inure to the benefit of
and be binding upon the Company and its successors and as
signs.
(c) The Company will require any successor
(whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of
the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same
manner and to the same extent that the Company would be
required to perform it if no such succession had taken
place. As used in this Agreement, "Company" shall mean the
Company as hereinbefore defined 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.
12. Miscellaneous. (a) This Agreement shall be
governed by and construed in accordance with the laws of the
Commonwealth of Virginia, without reference to principles of
conflict of laws. The captions of this Agreement are not
part of the provisions hereof and shall have no force or ef
fect. This Agreement may not be amended or modified other
wise than by a written agreement executed by the parties
hereto or their respective successors and legal representa
tives.
(b) All notices and other communications hereunder
shall be in writing and shall be given by hand delivery to
the other party or by registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:
If to the Executive:
Attention: [NAME]
[ADDRESS]
If to the Company:
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
or to such other address as either party shall have
furnished to the other in writing in accordance herewith.
Notice and communications shall be effective when actually
received by the addressee.
(c) The invalidity or unenforceability of any pro
vision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement.
(d) The Company may withhold from any amounts pay
able under this Agreement such Federal, state, local or for
eign taxes as shall be required to be withheld pursuant to
any applicable law or regulation.
(e) The Executive's or the Company's failure to
insist upon strict compliance with any provision hereof or
any other provision of this Agreement or the failure to as
sert any right the Executive or the Company may have here
under, including, without limitation, the right of the Execu
tive to terminate employment for Good Reason pursuant to
Section 5(c)(i)-(v) of this Agreement, shall not be deemed
to be a waiver of such provision or right or any other
provision or right of this Agreement.
IN WITNESS WHEREOF, the Executive has hereunto set
the Executive's hand and, pursuant to the authorization from
its Board of Directors, the Company has caused these
presents to be executed in its name on its behalf, all as of
the day and year first above written.
______________________________
[NAME]
▇▇▇▇▇ River Corporation of Virginia
By /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
