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This excerpt taken from the HBI 10-K filed Sep 28, 2006. Severance
The Severance Agreements with our executive officers provide
them with severance benefits upon their involuntary termination
of employment. Generally, if an executive officer’s
employment is terminated by us for any reason other than for
cause, or if an executive officer terminates his or her
employment at our request, we will pay them benefits for a
period of 12 to 24 months depending on their position and
length of service with Hanesbrands and with Sara Lee. The
Severance Agreements prohibit our executive officers from
working for our competitors, soliciting business from our
customers, attempting to hire our employees and disclosing our
confidential information while payments under the Severance
Agreement are being made. Payments under the Severance Agreement
terminate if the terminated executive officer becomes employed
by one of our competitors. As a condition of the Severance
Agreements, our executive officers must release any claims
against us.
The monthly severance benefit that we would pay to each
executive officer will be based on the executive officer’s
base salary (and, in limited cases, determined bonus), divided
by 12. A terminated executive officer also would receive a
pro-rated payment under any incentive plans applicable to the
fiscal year in which the termination occurs based on actual full
fiscal year performance. The terminated executive officer’s
eligibility to participate in our medical, dental and executive
life insurance plans would continue for the same number of
months for which he or she receives severance payments. The
terminated executive officer’s participation in all other
benefit plans would cease as of the date of termination of
employment.
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