This excerpt taken from the SVU 10-Q filed Jan 11, 2007.
On January 11, 2007, the Company entered into amended Change of Control Severance Agreements (the Amended Agreements) with each of the following executive officers of the Company: Jeffrey Noddle, Chairman and Chief Executive Officer; Michael L. Jackson, President and Chief Operating Officer; David L. Boehnen, Executive Vice President; John H. Hooley, Executive Vice President, Retail East; and Pamela K. Knous, Executive Vice President, Chief Financial Officer (collectively, the Named Executive Officers). The Amended Agreements replace the Change of Control Severance Agreements previously entered into with each of the Named Executive Officers, the form of which was filed as Exhibit 10.12 to the Companys Annual Report on Form 10-K for the year ended February 27, 1999 (the Existing Agreements), which were described under the heading Change-of-Control Agreements in the Companys Proxy Statement for the 2006 Annual Meeting of Shareholders filed May 30, 2006.
In general, the Existing Agreements entitled the Named Executive Officers to receive a lump-sum cash payment if the Named Executive Officers employment is terminated by the Company (other than for cause or disability, as defined in the agreements) or by the Named Executive Officer for good reason within two years after or in anticipation of a change-of-control (as defined in the agreements). In addition, Mr. Noddle is entitled to receive this payment if he terminates his employment for any reason during the seven months following a change in control. The lump-sum cash payment is equal to a multiple of three times the Named Executive Officers annual base salary, annual bonus (calculated in accordance with the agreements) and the value of the Named Executive Officers annual perquisites. Each Named Executive Officer would also receive a lump-sum retirement benefit equal to the present value of the additional qualified pension plan benefits the Named Executive Officer would have accrued under the plan absent the early termination. Generally, the Named Executive Officer would also be entitled to continued family medical, dental and life insurance coverage until the earlier of 36 months after termination or the commencement of comparable coverage with a subsequent employer. Each agreement includes a covenant not to compete with the Company. Due to the possible imposition of excise taxes on the payments, the agreements also provide that the severance benefits payable to a Named Executive Officer will be increased by an amount equal to the excise tax imposed on such payments.
The Amended Agreements contain substantially the same terms as the Existing Agreements, but were amended to comply with certain provisions of the amendments to Section 409A of the Internal Revenue Code of 1986, as amended. The foregoing description of the terms and conditions of the Amended Agreements is qualified in its entirety by reference to the Form of Amended Agreement, a copy of which is included as Exhibit 10.2 to this Quarterly Report on Form 10-Q.