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Item
5.02.
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Departure
of Directors or Certain Officers; Election of Directors; Appointment
of
Certain Officers; Compensatory Arrangements of Certain
Officers
|
On
September 21,
2007, the Company entered into the Employment and Change in Control
Agreement attached hereto as Exhibit 10.2 with Mr. Bruce J. Wood, the Company’s
President and Chief Executive Officer. The agreement replaces both the
employment agreement with Mr. Wood filed with the Company’s Annual Report on
Form 10-K filed August 29, 2002 (which expired on May 31, 2007) and the prior
employment-related agreement with Mr. Wood filed with the Company’s Current
Report on Form 8-K filed February 3, 2006. The Employment and Change in Control
Agreement contains substantially the same terms as the two prior agreements,
with certain changes made to clarify certain provisions and to reflect the
impact of recent provisions of the Internal Revenue Code of 1986, as amended
(the “Code”), relating to deferred compensation (including Code Section
409A).
Pursuant
to the
agreement, Mr. Wood is entitled to an annual base salary ($495,000 annualized
for fiscal 2008 and subject to annual review by the Compensation Committee
of
the Board of Directors) and to participate in the Company’s annual management
incentive bonus plan with a target bonus percentage equal to 70% of his base
salary. The agreement provides for severance benefits, including salary, bonus,
insurance coverage continuation, and certain vesting acceleration of equity
awards, for Mr. Wood in connection with (i) a termination of employment by
the
Company other than for “cause,” (ii) a termination of employment by Mr. Wood for
“good reason,” or (iii) the Company’s non-extension of one of the automatic
one-year term renewals described below. Mr. Wood is also entitled to certain
payments and equity award acceleration if the agreement is terminated in
connection with Mr. Wood’s death or disability. The agreement
also provides for tax gross-up payments for a “termination in connection with a
Change in Control” (as such terms are defined in the
agreement).
The
agreement is
effective as of June 1, 2007 and the term of the agreement generally continues
through May 31, 2008, with automatic one-year term renewals for up to three
successive years unless either the Company or Mr. Wood gives written notice
of
non-extension.
In
addition, on
September 21, 2007, the Company entered into amended and restated
employment-related agreements in the form attached hereto as Exhibit 10.3 with
the following named executive officers of the registrant: Mr. Joseph W. Baty,
Executive Vice President and Chief Financial Officer; Mr. Thomas H. Elitharp,
Executive Vice President - Operations and Support Services; and Daniel A.
Thomson, Executive Vice President - Business Development, General Counsel and
Corporate Secretary.
The
agreements
replace prior employment-related agreements with these officers filed with
the
the Company’s Current Report on Form 8-K filed February 3, 2006, and contain
substantially the same terms as the prior agreements, with certain changes
made
to clarify certain provisions and to reflect the impact of recent Code
provisions relating to deferred compensation (including Code Section 409A).
The agreements provide for severance benefits, including salary, bonus and
insurance coverage continuation, for the officer in connection with (i) a
termination of employment by the Company other than for “cause,” (ii) a
termination of employment by the officer for “good reason,” or (iii) a
“termination in connection with a Change in Control” (as such terms are defined
in the agreements). The agreements provide for full acceleration of vesting
of
certain equity awards in connection with a Change in Control and contain certain
tax gross-up provisions. The effective date of the agreements is as of September
21, 2007 and the term of each agreement generally continues through September
30, 2010.
Each
of the
foregoing descriptions of the Employment and Change in Control Agreement with
Mr. Wood and the amended and restated employment-related agreements with certain
executive officers is qualified in its entirety by reference to the full texts
of the applicable agreement (or form thereof) attached hereto as Exhibits 10.2
and 10.3.