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NS GROUP, INC.
DECEMBER 31, 2003 FORM 10-K
EXHIBIT 10.6
FORM OF CHANGE OF CONTROL SEVERANCE AGREEMENT
AGREEMENT by and between NS Group, Inc., a Kentucky Corporation
(the
"Company"), and _____ (the "Employee"),
dated as of the ____ day of _____, 2000.
The Company wishes to assure that it will have the continued
dedication
of the Employee notwithstanding the
possibility, threat or occurrence of a
Change of Control (as defined below) of the
Company. The Company believes it is
imperative to diminish the inevitable
distraction of the Employee by virtue of
the personal uncertainties and risks
created by a pending or threatened Change
of Control, to encourage the Employee's
full attention and dedication to the
Company upon a Change of Control, and to
provide the Employee with compensation
arrangements upon a Change of Control which
provide the Employee with individual
financial security and which are
competitive with those of other corporations
and, in order to accomplish these
objectives, the Company desires to enter into
this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1.
CERTAIN DEFINITIONS
(a)
"Affiliate" of any specified Person means (i) any
other Person which, directly or indirectly, is in
control of, is controlled by or is under common
control with such specified Person or (ii) any other
person who is a director or officer (A) of such
specified Person, (B) of any subsidiary of such
specified Person or (C) of any Person described in
clause (i) above or (iii) any person in which such
Person has, directly or indirectly, a 5 percent or
greater voting or economic interest or the power to
control. For the purposes of this definition,
"control" of a Person means the power, direct or
indirect, to direct or cause the direction of the
management or policies of such Person whether through
the ownership of voting securities, or by contract or
otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the
foregoing.
(b) "Agreement
Period" shall mean the period as defined
in Section 2 of this Agreement.
(c) "Board of
Directors"' shall mean the Board of
Directors of the Company as constituted from time to
time.
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(d) "Change of
Control" shall mean:
(i) the direct
or indirect sale, lease, exchange
or other transfer of all or substantially
all of the assets of the Company to any
Person or entity or group of Persons or
entities acting in concert as a partnership
or other group ("Group of Persons") other
than a Person described in clause (i) of the
definition of Affiliate;
(ii)
the consummation of any consolidation or
merger of the Company with or into another
corporation with the effect that the
stockholders of the Company immediately
prior to the date of the consolidation or
merger hold less than 51% of the combined
Voting Power of the outstanding voting
securities of the surviving entity of such
merger or the corporation resulting from
such consolidation ordinarily having the
right to vote in the election of directors
(apart from rights accruing under special
circumstances) immediately after such merger
or consolidation;
(iii) the
stockholders of the Company shall
approve any plan or proposal for the
liquidation or dissolution of the Company;
(iv)
a Person or Group of Persons acting in
concert as a partnership, limited
partnership, syndicate or other group shall,
as a result of a tender or exchange offer,
open market purchases, privately negotiated
purchases or otherwise, have become the
direct or indirect beneficial owner (within
the meaning of Rule 13d-3) under the
Securities Exchange Act of 1934, as amended
(the "Exchange Act") ("Beneficial Owner") of
securities of the Company representing 30%
or more of the combined Voting Power of the
then outstanding securities of the Company
ordinarily (and apart from rights accruing
under special circumstances) having the
right to vote in the election of directors;
(v) a Person
or Group of Persons, together with
any Affiliates thereof, shall succeed in
having a sufficient number of its nominees
elected to the Board of Directors of the
Company such that such nominees, when added
to any existing director remaining on the
Board of Directors of the Company after such
election who is an Affiliate of such Person
or Group of Persons, will constitute a
majority of the Board of Directors of the
Company; provided that the Person or Group
of Persons referred to in clauses (i), (iv)
and (v) shall not mean Clifford Borland or
any Group of Persons with respect to which
Clifford Borland is the Beneficial Owner of
the majority of the voting equity interests.
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(e) "Cause"
shall be defined as (i) Conviction
or judicial admission by the Employee of any
felony criminal act, a crime involving moral
turpitude, or a crime of fraud or
dishonesty; (ii) acts by Employee
constituting gross negligence or willful
misconduct to the detriment of the Company;
(iii) Employee's misfeasance, nonfeasance or
malfeasance in the performance of his
duties; [OR] (iv) Employee's failure or
refusal to comply with the lawful directions
of Company's Board of Directors or with the
policies, standards and regulations of the
Company after notice and failure to cure
within thirty (30) days; [OR (v) EMPLOYEE'S
BREACH OF SECTIONS 4, 5, 6, 7, AND 9 OF THE
EMPLOYMENT AGREEMENT].
(f) "Company"
as used herein includes NS Group,
Inc. and any of its subsidiaries and
divisions and, as provided by Section 12(b)
hereof, any successor.
(g) "Date of
Termination" shall be the date on
which the Notice of Termination is actually
received by the addressee, or alternatively,
if the Notice of Termination specifies a
date other than the date of receipt of such
notice then that specified date shall be the
Date of Termination.
(h) "Effective
Date" shall mean the first date
on which a Change of Control occurs;
provided, however, that if the Employee's
employment is terminated by the Company
prior to the date on which a Change of
Control occurs, and the Employee can
reasonably demonstrate that such termination
by the Company was in contemplation of a
Change of
Control, then for all purposes of
this Agreement the "Effective Date" shall
mean the date immediately prior to the date
of such termination.
(i) "Good
Reason" means: (i) any material
adverse change in compensation to the
Employee; (ii) substantial decrease in the
nature or scope of the Employee's duties,
responsibilities, powers, authority, title,
position or status; (iii) unreasonable
travel requirements; (iv) any relocation
required on the part of Employee, without
his consent, outside of a 50-mile radius
from his primary residence on the Effective
Date; or (v) material breach by the Company
of an employment, compensation or similar
agreement between the Employee and the
Company.
(j) "Person"
means any individual, corporation,
partnership, joint venture, association,
joint-stock company, trust, unincorporated
organization, government or any agency or
political subdivision thereof or any other
entity within the meaning of Section
13(d)(3) or 14(d) (2) of the Exchange Act.
(k) "Voting
Power" shall mean the voting power
of all securities of a Person then
outstanding generally entitled to vote for
the election of directors of
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the Person (or, where appropriate, for the
election of persons performing similar
functions).
2.
AGREEMENT PERIOD
The Company hereby agrees to provide the Employee with the
protections
and benefits enumerated in Section 3 of
this Agreement for the period commencing
on the Effective Date and ending on the
third anniversary of the Effective Date.
3.
OBLIGATIONS OF THE COMPANY UPON TERMINATION
(a) Notice of
Termination. Any termination after the
Effective Date by the Company or by the Employee
shall be communicated by Notice of Termination,
within ten (10) business days after the later of the
date of employment termination or the date of Change
of Control, to the other party hereto given in
accordance with Section 13(c) of this Agreement. For
purposes of this Agreement, a "Notice of Termination"
means a written notice which (i) sets forth in
reasonable detail the facts and circumstances claimed
to provide a basis for termination of the Employee's
employment, and (ii) if the termination date is other
than the date of receipt of such notice, specifies
the termination date.
(b)
Termination by the Company for Cause; Termination by
the Employee for Other Than Good Reason. If during
the Agreement Period, the Employee's employment is
terminated by the Company for Cause, by the Employee
other than for Good Reason, or by reason of death or
disability, this Agreement shall terminate without
further obligations to the Employee.
(c)
Termination by the Company other than for Cause;
Termination by the Employee for Good Reason. If,
during the Agreement Period, the Company shall
terminate the
Employee's employment other than for
Cause, or the employment of the Employee shall be
terminated by the Employee for Good Reason, the
Employee shall be entitled to the following payments
and benefits:
(i) The
Company shall pa
