STATE
OF GEORGIA,
COUNTY OF MUSCOGEE:
THIS
AGREEMENT, made and entered into as of the 12th day of September,
1994, by and between AFLAC Incorporated, a Georgia corporation,
hereinafter referred to as “Corporation,” and JOEY M.
LOUDERMILK, a resident of said State and County, hereinafter
referred to as “Employee;”
WHEREAS,
Corporation and Employee desire to enter into an Employment
Agreement and to set forth the terms and conditions of
Employee’s employment as an executive employee by Corporation
as its Senior Vice President, Corporate Secretary, and General
Counsel;
NOW,
THEREFORE, the parties, for and in consideration of the mutual
covenants and agreements hereinafter contained, do contract and
agree as follows, to-wit:
1.
Purpose and employment . The purpose of this Agreement is to
define the relationship between Corporation as an employer and
Employee as an employee and Senior Vice President, Corporate
Secretary, and General Counsel of the Corporation.
2.
Duties . Employee agrees to provide executive management
services as Senior Vice President, Corporate Secretary, and General
Counsel of Corporation to Corporation and its subsidiaries and
affiliates on a full-time and exclusive basis; provided, however,
nothing shall preclude Employee from engaging in charitable and
community affairs or managing his own or his family’s
personal investments.
3.
Performance . Employee agrees to devote all necessary time
and his best efforts in the performance of his duties as Senior
Vice President, Corporate Secretary, and General Counsel of
Corporation on behalf of Corporation and its subsidiaries and
affiliates.
4.
Term . The term of employment under this Agreement shall
begin September 1, 1994, and shall continue for a period of
three (3) years until August 31, 1997, unless extended or
sooner terminated as hereinafter provided. On an annual basis
beginning effective September 1, 1995, the scheduled term of
this Agreement shall be extended for successive one year periods
unless written notice of termination is given prior to such annual
date by one party to the other party that the Agreement will not be
extended by its terms.
5.
Base salary . For all the services rendered by Employee,
Corporation shall continue to pay Employee a base salary of
per year commencing September 1, 1994, said salary to be
payable in accordance with Corporation’s normal payroll
procedures. Employee’s base salary may be increased annually
during the term of this Agreement and any extensions hereof as
determined by the Chief Executive Officer.
6.
Adjustments to base salary . Corporation and Employee shall,
from time to time, reflect increases in Employee’s base
salary as provided for in Paragraph 5 by entering the change
on the “Schedule of
Compensation,”
as shown by the form attached hereto as Exhibit “A” and
made a part hereof. If an increase in compensation is entered on
said Schedule and duly signed by the proper officers of Corporation
and by Employee, said entry shall constitute an amendment to this
Employment Agreement as of the date of said entry and shall
supersede the base salary provided for in Paragraph 5 and any
other increases in Employee’s base salary previously entered
on said Schedule.
7.
Management Incentive Plan . In addition to the base salary
paid to Employee in accordance with Paragraph 5, Corporation
shall, for each calendar year of Employee’s employment by
Corporation, beginning with the calendar year 1994, continue to pay
Employee, as performance bonus compensation, an amount determined
each year under Corporation’s current Management Incentive
Plan (short-term Incentive Program) with a target level based on at
least thirty-five percent (35%) of base salary. Nothing in this
paragraph shall preclude Employee from receiving additional
discretionary bonuses approved by the Chief Executive Officer or
the Board.
8.
Employee benefits . Employee shall be eligible to
participate with other employees of the Corporation in all fringe
benefit programs applicable to employees generally which may be
authorized and adopted from time to time by the Board, including
without limitation: a qualified pension plan, a profit sharing
plan, a disability income or sick pay plan, a thrift and savings
plan, an accident and health plan (including medical reimbursement
and hospitalization and major medical benefits), and a group life
insurance plan. In addition, Corporation shall furnish to Employee
such other “fringe” or employee benefits as are
provided to key executive employees of Corporation and such
additional employee benefits which the Compensation Committee of
the Board shall determine to be appropriate to Employee’s
duties and responsibilities as General Counsel of Corporation,
including, without limitation, reimbursement of legal and
accounting expenses incurred by Employee in connection with the
preparation of his employment or other agreements with Corporation
and any expenses for legal, accounting or financial services
incurred by Employee in connection with his employment.
9.
Stock option plans . Employee shall be eligible to be
awarded stock options to purchase Corporation’s common stock
under Corporation’s Stock Option Plans for selected key
employees and directors during the term of this
Agreement.
10.
Working facilities and expenses . Employee shall be provided
with an office, books, periodicals, stenographic and technical
help, ground and air transportation, and such other facilities,
equipment, supplies and services suitable to his position and
adequate for the performance of his duties. The Corporation shall
pay Employee’s fees and dues in such social and country
clubs, civic clubs and business societies and associations as shall
be appropriate in facilitating Employee’s job performance and
in the best interest of Corporation. The Corporation shall also pay
all appropriate business liability insurance and any business
licenses and fees pertaining to the services rendered by Employee
hereunder.
Employee
is encouraged and is expected, from time to time to incur
reasonable expenses for promoting the business of Corporation,
including expenses for social and civic club memberships and
participation, entertainment, travel and other activities
associated with Employee’s duties. The cost of all such
activities shall be the expenses of Corporation unless the
Compensation Committee of the Board shall determine in advance that
any such expense of Employee should be paid by Employee.
11.
Vacation . Employee shall continue to be entitled to his
vacation time with pay during each calendar year in accordance with
Corporation’s vacation policy for senior executive employees.
In addition, Employee shall be entitled to such holidays as
Corporation shall recognize for its employees generally.
12.
Sickness and total disability . Employee’s absence
from work because of sickness or accident (not resulting in
Employee becoming “totally disabled,” as that term is
hereinafter defined) shall not result in any adjustment in
Employee’s compensation or other benefits under this
Agreement.
Should
Employee become totally disabled as a result of sickness or
accident and unable to adequately perform his regular duties
prescribed under this Agreement, his base salary (which shall
continue to be adjusted as provided for in Paragraph 5),
together with incentive bonuses under the Corporation’s
Management Incentive Plan and his participation in
Corporation’s employee benefit programs and retirement plan
shall continue without reduction except as hereinafter provided,
during the continuance of such disability of a period not exceeding
the earlier of (1) the end of the term of this Agreement or
any extension hereof or (2) a period of one and one-half
(1-1/2) years (547 calendar days) for each continuous disability.
Payments pursuant to this paragraph 12 shall be reduced by any
amounts paid to Employee during any such period of disability from
time to time under any disability programs, plans or policies
maintained by Corporation, its subsidiaries or
affiliates.
Should
Employee’s total disability continue for a period beyond the
end of the term of this Agreement or in excess of 547 calendar
days, this Agreement shall, at the end of such period which first
occurs, be automatically terminated. If, however, prior to such
time, Employee’s total disability shall have ceased and he
shall have resumed the adequate performance of his duties
hereunder, this Agreement shall continue in full force and effect
and Employee shall be entitled to continue his employment hereunder
and to receive his full compensation and other benefits as though
he had not been disabled; provided, however, unless Employee shall
adequately perform his duties hereunder for a continuous period of
at least sixty (60) calendar days following a period of total
disability before Employee again becomes totally disabled, he shall
not be entitled to start a new 547-day period under this paragraph,
but instead may only continue under the remaining portion of the
original 547-day period of total disability. In the event Employee
shall not adequately perform his duties hereunder for a continuous
period of at least sixty (60) calendar days following a period
of total disability, the running of the original 547-day period
shall cease during the time of Employee’s adequate
performance of his duties hereunder before Employee again becomes
totally disabled.
It
is understood that for purposes of this Paragraph 12, Employee
shall, upon his becoming totally disabled, be given such additional
“credited service” if necessary to fully qualify
Employee under Corporation’s Supplemental Executive
Retirement Plan (SERP) and to provide a survivor annuity to
Employee’s spouse under the Plan.
For
the purpose of this Agreement, the term “totally
disabled” or “total disability” shall mean
Employee’s inability to adequately perform his executive and
management duties hereunder on account of accident or illness. It
is understood that Employee’s occasional sickness or other
incapacity of short duration may not result in his being or
becoming “totally disabled;” however, such illness or
incapacity could constitute Employee’s being or becoming
“totally disabled” if such illness or incapacity is
prolonged or recurring.
13.
Termination of employment .
A.
Termination by Corporation. The Corporation’s Chief Executive
Officer may terminate this Agreement, at any time, with or without
“good cause” (“good cause” being
hereinafter defined), by giving
at
least sixty (60) days’ written notice to Employee of its
intention to terminate Employee’s employment without
“good cause” or at least five (5) days’
written notice to Employee of its intention to terminate
Employee’s employment for “good cause;” provided,
however, Corporation may, at its selection, terminate
Employee’s actual employment (so that Employee no longer
renders services on behalf of Corporation) at any time during said
sixty (60) day or five (5) day period; and,
(1) In
the event such termination is for “good cause,”
Corporation shall be obligated only to:
(a)
pay Employee his base salary as provided for in Paragraph 5 of
this Agreement up to the termination date stated in said written
notice; provided, however, if Corporation does not elect to
terminate Employee’s employment during said five (5) day
period, but Employee, after receiving such notice of termination
from Corporation, elects to leave the employ of Corporation prior
to the end of said five (5) day period without the approval of
Corporation, then Corporation shall pay said base salary only up to
the date on which Employee actually terminates his
employment
(b)
pay Employee any performance bonus due Employee under
Paragraph 7 of this Agreement for the period ending on the
termination date stated in said written notice or on such earlier
date of Employee’s actual termination of his employment prior
to the end of said (5) day period if such termination is
without the approval of Corporation The amount of said bonus, if
any, shall be calculated on a prorata basis, using the number of
days Employee was actually employed during such period, and the
amount so calculated shall be paid to Employee within a reasonable
time after the end of Corporation’s fiscal year in which
written notice of Employee’s termination is given;
(c)
continue to honor all fully vested stock options, subject to the
terms thereof, granted to Employee prior to the termination date
stated in said written notice or prior to such earlier date of
Employee’s actual termination of his employment prior to the
end of said five (5) day period if such termination is without
the approval of the Corporation;
(d)
continue to pay all of Employee’s fringe and other employee
benefits as provided for in this Agreement up to the termination
date stated in said written notice or up to such earlier date of
Employee’s actual termination of his employment prior to the
end of said five (5) day period if such termination is without
the approval of the Corporation.
(e)
For purposes of this subparagraph (1) and paragraph 18 hereof,
“good cause” shall mean: (i) the willful and
deliberate failure of Employee to substantially perform his
executive and management duties hereunder for a continuous period
of more than sixty (60) days for reasons other than
Employee’s sickness, injury or disability; (ii) the
willful and deliberate conduct by Employee which is intended by
Employee to cause, and which does in fact result in substantial
injury or damage to Corporation; or (iii) the conviction or
plea of guilty by Employee of a felony crime involving moral
turpitude.
(2) In
the event such termination is without “good cause,” as
defined in subparagraph (1)(e) of this paragraph and, if
applicable, subject to the terms of paragraph 18, Corporation shall
be obligated to:
(a)
pay employee his base salary as provided for in paragraph 5 of this
Agreement up to the end of the scheduled term of this
Agreement;
(b)
pay employee his performance bonus compensation as provided for in
paragraph 7 of this Agreement up to the end of the scheduled term
of this Agreement;
(c)
continue to honor all stock options, subject to the terms thereof,
granted to Employee prior to the termination date stated in said
written notice, all of said options to be or become fully vested as
of the termination date stated in said written notice;
(d)
continue to pay or provide to Employee all of the retirement,
health, life and disability benefits, as are provided for in this
Agreement or under any programs, plans or policies covering
Employee at the time of any such notice of termination, up to the
end of the scheduled term of this Agreement.
B.
Termination by Employee . Employee may terminate this
Agreement, at any time by giving at least sixty
(60) days’ written notice to Corporation of his
intention to terminate his employment;
(1) in
the event such termination by Employee shall be without “good
reason” (as defined in paragraph 18 hereof) and with a bona
fide intent to retire or to work or engage in a business or
activity which is not in competition with Corporation or any of its
subsidiaries or affiliates, Corporation shall be obligated
to:
(a)
pay Employee his base salary due him under paragraph 5 of this
Agreement up to the termination date stated in said written
notice;
(b)
pay Employee any performance bonus compensation due him under
paragraph 7 of this Agreement for the period ending on the
termination date stated in said written notice. The amount of such
performance bonus, if any shall be calculated on a basis, using the
number of days Employee was actually employed by Corporation during
such year of termination; and the amount so calculated shall be
paid to Employee within a reasonable time after the end of
Corporation’s fiscal year in which Employee’s notice of
termination is given;
(c)
continue to honor all stock options, subject to the terms thereof,
granted to Employee which are fully vested prior to the termination
date stated in said written notice;
(d)
pay Employee, and if elected by Employee, his spouse such
retirement benefits as are provided for in the Supplemental
Executive Retirement Plan (SERP) under paragraph 9 hereof,
said benefits to commence at such time as provided for under the
Retirement Plan. For purposes of this subparagraph, Employee shall
continue
to
accrue “credited service” as Employee under the
Supplemental Executive Retirement Plan (SERP) up through the
termination date stated in said notice.
(2) In
the event such termination by Employee shall be for “good
reason” (as defined in paragraph 18 hereof), the Corporation
shall be obligated to provide Employee with the payments, benefits
and rights specified in subparagraphs A.(2)(a)-(d) of this
paragraph 13 hereof.
(3) In
the event such termination by Employee shall be without “good
reason” (as defined in paragraph 18 hereof) and with the
intention or purpose to work or invest, directly or indirectly, in
a business or activity which is in competition, directly or
indirectly, with Corporation or any of its subsidiaries or
affiliates or, irrespective of Employee’s intention at the
time of his termination, if Employee shall violate his covenant not
to compete under paragraph 15 or the requirements of paragraph 16,
then Corporation shall not be obligated to make or provide any
further payments or benefits to Employee under this Agreement
except as herein provided in this subparagraph.
(a)
Subject to Corporation’s rights under paragraphs 15 and 16,
Corporation shall pay Employee his base salary due him under
paragraph 5 of this Agreement up to the termination date stated in
said written notice;
(b)
Subject to Corporation’s rights under paragraphs 15 and 16
hereof, Corporation shall continue to honor all stock options,
subject to the terms thereof, granted to Employee which are fully
vested prior to the termination date stated in said written
notice;
C.
Termination while disabled . If Employee is totally disabled
at the time any such notice of termination is given, then
notwithstanding the provisions of this paragraph 13, Corporation
shall nevertheless continue to pay Employee, as his sole
compensation hereunder, the compensation and other benefits for the
remaining period of Employee’s total disability as provided
for in paragraph 12 hereinabove. It is understood that in no event
shall such disabled Employee be entitled to compensation under this
paragraph 13 in addition to the continuation of his compensation
under paragraph 12.
D. Cooperation
after notice of termination Following any such notice of
termination, Employee shall fully cooperate with Corporation in all
matters relating to the winding up of his pending work on behalf of
Corporation and the orderly transfer of any such pending work to
other employees of Corporation as may be designated by the Chief
Executive Officer; and to that end, Corporation shall be entitled
to such full-time or part-time services of Employee as Corporation
may reasonably require during all or any part of the sixty
(60) day period following any such notice of
14.
Death of Employee . In the event of Employee’s death
during the term of this agreement or any extension hereof, this
Agreement shall terminate immediately, and Employee’s estate
shall be entitled to receive terminal pay in an amount equal to the
amount of Employee’s base salary and any performance bonus
compensation actually paid by Corporation to Employee during the
last thirty-six (36) months of his life, said terminal pay to
be paid in thirty-six (36) equal monthly installments
beginning on the first day of the month next following the month
during which Employee’s death occurs. Terminal pay as herein
provided for in this paragraph shall be in addition to amounts
otherwise receivable by Employee or his estate under this or any
other agreements with Corporation or under any employee benefits or
retirement plans established by Corporation
and in
which Employee is participating at the time of his death. In
addition, Corporation shall honor all stock options, subject to the
terms thereof, granted to Employee prior to his death and Employee
or his Estate shall, if not otherwise vested, become fully vested
in said options as of the date of Employee’s death. For
purposes of this paragraph, Employee shall, upon his death, be
given such additional “credited service” as necessary
to fully qualify Employee under Corporation’s Supplemental
Executive Retirement Plan (SERP) and to provide a survivor
annuity to Employee’s spouse under the Plan.
15.
Agreement not to compete .
It
is specifically agreed that, in the event Employee shall
voluntarily terminate his employment without “good
reason” (as defined in Paragraph 18) or be terminated by
Corporation for “good cause” (as defined in
Paragraph 13) Employee shall not work for a period of two
(2) years from the date of such termination, as a manager,
officer, owner, partner or employee or render any services as a
consultant or advisor or engage or invest, directly or indirectly,
in any activity which is in competition with the business of the
Corporation, its subsidiaries or affiliates within the States of
Georgia or Alabama. Provided, however it is agreed that Employee
may invest in the publicly traded securities of any corporation,
partnership or trust which is in competition with Corporation so
long as such investment does not exceed three percent (3%) of such
securities at any time. It is specifically agreed that if, after
Employee’s termination of employment, Employee engages in any
such prohibited activity at any time during said two year period,
Corporation shall, in addition to any other rights it may have
under this contract and applicable law be entitled to injunctive
relief or, if the Corporation shall so elect, (due to the
difficulty of determining damages) be entitled to liquidated
damages in the amount of Two Hundred and Fifty Thousand Dollars
($250,000.00) which Employee agrees to promptly pay to Corporation
upon demand.
16.
Nondisclosure of trade secrets and confidential information
. Employee agrees to protect the business interest of Corporation,
its subsidiaries and affiliates, and not to disclose any trade
secrets, confidential information or any organizational, operating,
marketing, product design, or business know-how which Employee has
access to or knowledge of as a result of his employment by
Corporation. It is specifically agreed that if, at any time during
the term of this Agreement and for a period of two (2) years
after the date of employee’s termination of employment with
Corporation for any reason, Employee shall violate the provisions
of this paragraph 16, Corporation shall, in addition to any rights
it may have under this contract and applicable law, be entitled to
liquidated damages of Two Hundred and Fifty Thousand Dollars
($250,000.00) which Employee agrees to promptly pay Corporation
upon demand. It is understood and agreed that Corporation’s
remedies under this paragraph 16 shall be separate and in addition
to the remedies provided to Corporation under paragraph 15 hereof.
It is also understood and agreed that, notwithstanding the
foregoing two (2) year period, Employee shall not use or
disclose any written confidential information or any policyholder
lists at any time or times hereafter, except in the performance of
Employee’s obligations to the Corporation.
17.
Right to acquire insurance . If Employee shall terminate his
employment hereunder for any reason other than death, he may, at
his election, acquire any insurance policies upon his life owned by
the Corporation by giving written notice of his election to
Corporation within ninety (90) days after his termination of
employment. Such policies shall be transferred to the Employee upon
his payment to Corporation of the then interpolated terminal
reserve value of said insurance. In the event any policies
transferred to Employee as herein provided shall not have an
interpolated terminal reserve value, then the amount to be paid by
Employee shall be its then fair market value.
A. In
general. In the event there is a Change in Control (as defined in
this paragraph) of Corporation, this Agreement shall, in order to
help eliminate the uncertainties and concerns which may arise at
such time, be automatically extended upon all of the same terms and
provisions contained herein, for an additional period of three
(3) years, beginning on the first day of the month during
which such Change in Control shall occur.
B. Notwithstanding
the term of subparagraph A(2) and (B)(2) of Paragraph 13, and
in lieu of the obligations of the Corporation under such paragraph,
if, after a Change in Control Employee’s employment is
terminated by Corporation without “good cause” (as
defined in paragraph 13), or is terminated by Employee for
“good reason” (as defined in paragraph 18), any such
termination by Corporation to be made only in accordance with the
requirements specified by paragraph 13.A, Employee shall be
entitled to the following:
(1) The
Corporation shall pay Employee’s full base salary to Employee
through the date of termination stated in Corporation’s
written notice required pursuant to paragraph 13.A hereof
(hereinafter in this paragraph the “Termination Date”)
at the rate in effect on the date such notice is given and,
additionally, shall pay Employee all compensation and benefits
payable to Employee under the terms of any compensation or benefit
plan, program or arrangement maintained by the Corporation during
such period through the Termination Date.
(2) The
Corporation shall pay Employee all compensation and benefits due
Employee under Corporation’s retirement, insurance and other
compensation or benefit plans, programs of arrangements as such
payments become due. The amount of such compensation and benefits
shall be determined under, and paid in accordance with,
Corporation’s retirement, insurance and other compensation or
benefit plans, programs and arrangements.
(3) In
lieu of any further salary payments to Employee for periods
subsequent to the Termination Date, the Corporation shall pay to
Employee, immediately after the Termination Date, a lump sum
severance payment, in cash, equal to three times the sum of
(i) Employee’s annual base salary in effect immediately
prior to the Change in Control and (ii) the higher of the
amount paid to Employee pursuant to the Corporation’s
Management Incentive Plan (or any successor plan thereto) for the
year preceding the year in which the Termination Date occurs or
paid in the year preceding the year in which the Change in Control
occurs.
(4) The
Corporation shall pay to Employee, immediately after the
Termination Date, a lump sum amount, in cash, equal to a prorata
portion (based on the number of days Employee is an employee during
the year in which the Termination Date occurs) of the aggregate
value of the maximum annual target amount of all contingent
incentive compensation awards to Employee for all uncompleted
periods under the Corporation’s Management Incentive Plan (or
successor plan.
(5) For
a thirty-six (36) month period after the termination date, the
Corporation shall provide Employee with life, disability, accident
and health insurance benefits substantially similar to an equal or
greater in economic value than such benefits which Employee is
receiving immediately prior to the Termination Date (without giving
effect to any reduction in such benefits subsequent to a Change
in
Control
which reduction in benefits would constitute “good
reason” as defined in this paragraph). Benefits required to
be provided to Employee pursuant to this subparagraph B(5) shall be
reduced to the extent comparable benefits are actually received by
or made available to Employee without cost during such thirty-six
(36) month period and any such benefit actually received by
Employee shall be reported to the Corporation by
Employee.
C. In
addition to the payments provided for in subparagraph B of this
paragraph 18, in the event that after a Change in Control
Employee’s employment by the Corporation is terminated by the
Corporation without “good cause” or by Employee for
“good reason,” the Corporation shall continue to honor
all stock options granted to Employee (subject to the terms of such
options) prior to the Termination Date, and all stock options
granted to Employee prior to the Termination Date shall become
fully vested and exercisable as of the Termination Date.
D. Notwithstanding
any other provisions of this Agreement, in the event that any
payment or benefit received or to be received by Employee in
connection with a Change in Control or the termination of
Employee’s employment (whether pursuant to the terms of this
Agreement or any other plan, arrangement or agreement with the
Corporation, any person whose actions result in a Change in Control
or any person affiliated with the Corporation or such person) (all
such payment and benefits being hereinafter called “Total
Payments”) would not be deductible (in whole or in part) by
the Corporation, an affiliate or person making such payment or
providing such benefit as a result of section 280G of the Internal
Revenue Code of 1986 (the “Code”) then, to the extent
necessary to make such portion of the Total Payments deductible
(and after taking into account any reduction in the Total Payment
provided by reason of Section 280G of the Code in such other
plan, arrangement or agreement), adjustments in such payments shall
be made as follows: (1) the cash payments provided pursuant to
subparagraph B(3) and B(4) of this paragraph 18 shall first be
reduced (if necessary, to zero), and (2) benefits provided
under subparagraph B(5) of this paragraph 18. For purposes of this
limitation (i) no portion of the Total Payments the receipt or
enjoyment of which Employee shall have effectively waived in
writing prior to the date of termination of employment shall be
taken into account, (ii) no portion of the Total Payments
shall be taken into account which in the opinion of tax counsel
selected by the Corporation’s independent auditors and
reasonably acceptable to Employee does not constitute a
“parachute payment” within the meaning of
Section 280G(b) (2) of the Code, including by reason of
Section 280G(b) (4) (A) of the Code, (iii) the
payments and benefits be reduced only to the extent necessary so
that the Total Payments (other than those referred to in clauses
(i) or (ii) in their entirety constitute reasonable
compensation for services actually rendered within the meaning of
Section 280G(b) (4) (B) of the Code or are otherwise not
subject to disallowance as deductions, (iv) the value of any
non-cash benefit or any deferred payment or benefit included in the
Total Payments shall be determined by the Corporation’s
independent auditors in accordance with the principles of Section
280G(d) (3) (4) of the Code. In no event shall the
Corporation’s obligation to continue to honor all stock
options granted to Employee prior to the Termination Date nor the
vesting of stock options in accordance with Paragraph 18.C.
hereof be affected by this Paragraph 18.D.
(1)
“Beneficial Owner” has the meaning provided in
Rule 13d-3 under the Exchange Act.
(2)
“Change in Control” means the occurrence of either (a),
(b), (c) or (d), as hereinafter set forth:
(a)
any person is or becomes the Beneficial Owner, directly or
indirectly, of securities of the Corporation (not including in the
securities beneficially owned by such person any securities
acquired directly from the Corporation, subsidiaries or its
affiliates) representing 30% or more of the combined voting power
of the Corporation’s then outstanding securities;
or
(b)
during any period of two consecutive years (not including any
period prior to the execution of this Agreement), individuals who
at the beginning of such period constitute the Board and any
director (other than a director designated by a person who has
entered into an agreement with the Corporation to effect a
transaction described in clause (a), (c) or (d) of this
subparagraph) whose election by the Board or nomination for
election by the Corporation’s stockholders was approved by a
vote of at least two-thirds (2/3) of the members of the Board (or,
if Board nominations are not voted on by the full Board, members of
the Board Committee voting on such nominations) then still in
office who either were members of the Board at the beginning of the
period or whose election or nomination for elections was previously
so approved, cease for any reason to constitute a majority of the
Board; or
(c)
the shareholders of the
|
