March 31, 2005
Mr. Warren B. Schmidgall
3630 S.W. Canterbury
Topeka, KS 66610
Re: Non-renewal of Employment Agreement
As you and I have discussed, the Company does not intend to renew your
Employment Agreement when it expires on September 30, 2005. This letter will
describe our agreement regarding your continuing terms of employment and your
resignation from the Company, amending your Employment Agreement.
From the date of this letter through the termination of your Employment
Agreement on September 30, 2005 or the effective date of your resignation,
whichever occurs sooner, the Company will employ you in the capacity of
Executive Vice President. The following terms will apply to your employment and
(1) You will be eligible to continue to participate in "Employee
Welfare Plans" as outlined in the Employment Agreement for a period of 18
months from September 30, 2005 or the effective date of your resignation,
whichever occurs sooner. You will be eligible for an additional 18 months
of COBRA coverage at the end of the first 18 months, at your expense. Your
participation in these plans will end earlier, however, when you are
eligible to participate in the health plan of another employer.
(2) You have already received a payment of $22,000 and options to buy
9,000 shares of stock under the Company's Salaried Bonus plan, as set out
in Section 3.1 of the Employment Agreement. You will be eligible to
participate further in the Bonus plan at the "norm" bonus level, with no
individual modifier applied, but only to a maximum potential additional
cash bonus of $30,000;
(3) You will be eligible for continued vesting of restricted shares
and stock options through September 30, 2005.
(4) You will be eligible to exercise any vested stock options through
September 30, 2008.
(5) The duties of your position will include the following: (1)
oversight of the Company's Human Resources function; (2) oversight of the
Information Technology function, specifically strategy development, in
conjunction with George Shadid; and (3) such other job duties as
specifically assigned by George Shadid and/or me.
(6) I will provide reasonable assistance to you in obtaining new
(7) You will be permitted to conduct your search for new employment
during your regular working hours on an as-needed basis. Starting July 1,
2005, you will be released from your duties under (5), above, in order to
allow you to spend your full time in search of new employment. You will
continue to be paid as required under your Employment Agreement through
September 30, 2005, unless you resign earlier. During this period you may
maintain your office at AIPC, including utilization of your company
provided computer and cell phone. You will also be provided outplacement
support with Right Management Consultants, not to exceed $7,500 during this
(8) You will be covered by the Officer Indemnification Agreement as
approved by the Board of Directors at its February 2, 2005 meeting.
You agree to items (1) - (8), above, and that the terms and conditions set