JUNE 30, 2003, THE EMERGENCE BONUS SHALL BE $125,000; IF THE PLAN
EFFECTIVE DATE OCCURS AFTER JUNE 30, 2003 BUT NO LATER THAN SEPTEMBER 30, 2003,
THE EMERGENCE BONUS SHALL BE $62,500; AND IF THE PLAN EFFECTIVE DATE IS AFTER
SEPTEMBER 30, 2003, EMPLOYEE SHALL NOT BE ENTITLED TO ANY EMERGENCE BONUS.
(III)
THE PERFORMANCE BONUS AND/OR THE EMERGENCE BONUS SHALL BE
REFERRED TO HEREIN COLLECTIVELY AS THE "BONUSES" OR EACH SEPARATELY AS A
"BONUS".
THE PROVISIONS HEREIN RELATING TO THE BONUSES ARE DEEMED TO BE AND
CONSTITUTE MODIFICATIONS TO THE COMPANY'S "INCENTIVE BONUS PLAN FOR RESTRUCTURE
TRANSACTION" EFFECTIVE AS OF AUGUST 22, 2002, AS MAY HAVE BEEN PREVIOUSLY
MODIFIED, AMENDED OR SUPPLEMENTED.
(IV)
POST-CHAPTER 11 ANNUAL TARGET BONUS.
DURING EACH YEAR (OR PORTION
THEREOF) OF THE TERM SUBSEQUENT TO THE PLAN EFFECTIVE DATE, THE EMPLOYEE SHALL
PARTICIPATE IN EACH BONUS OR OTHER INCENTIVE PLAN ESTABLISHED FOR SENIOR
EXECUTIVES.
(ALL PAYMENTS MADE PURSUANT TO SUCH PLANS SHALL BE REFERRED TO AS A
"POST-CHAPTER 11 BONUS".)
EACH FISCAL YEAR (OR PORTION THEREOF) SUBSEQUENT TO
THE PLAN EFFECTIVE DATE, THE COMPANY SHALL ESTABLISH A TARGET BONUS TO BE
PAYABLE TO THE EMPLOYEE FOR REACHING CERTAIN SPECIFIED GOALS AND OBJECTIVES, IN
THE MINIMUM ANNUAL AMOUNT OF $275,000 ("POST-CHAPTER 1L ANNUAL TARGET BONUS").
FOR THE PERIOD FROM THE PLAN EFFECTIVE DATE THROUGH MARCH 31, 2004 (THE END OF
THE COMPANY'S FISCAL YEAR), THE POST-CHAPTER 11 ANNUAL TARGET BONUS IS
ESTABLISHED AT $275,000 OR PROPORTIONATE SHARE THEREOF BASED ON THE TIMING OF
THE OCCURRENCE OF THE PLAN EFFECTIVE DATE.
(C)
BENEFITS
THE EMPLOYEE SHALL BE ENTITLED TO PARTICIPATE IN THE
INCENTIVE, VACATION, SAVINGS, AND RETIREMENT PLANS AND POLICIES GENERALLY
APPLICABLE TO OTHER SENIOR EXECUTIVES OF THE COMPANY, AS THEY MAY BE AMENDED
FROM TIME TO TIME ("BENEFITS").
NOTWITHSTANDING THE FOREGOING, THE EMPLOYEE
SHALL BE ENTITLED TO AT LEAST SIX (6) WEEKS OF VACATION PER TWELVE (12) MONTH
PERIOD.
THE EMPLOYEE SHALL ALSO BE ENTITLED TO PARTICIPATE IN ALL WELFARE
BENEFIT PLANS AND POLICIES GENERALLY PROVIDED BY THE COMPANY TO OTHER SENIOR
EXECUTIVES, AS THEY MAY BE AMENDED FROM TIME TO TIME, INCLUDING GROUP MEDICAL,
PRESCRIPTION, DENTAL, DISABILITY, SALARY CONTINUATION, LIFE, ACCIDENTAL DEATH
AND TRAVEL INSURANCE PLANS ("WELFARE BENEFITS").
(D)
SHARE OPTIONS
(I)
IN CONJUNCTION WITH THE EXECUTION OF THIS AGREEMENT, THE COMPANY
HAS GRANTED TO EMPLOYEE OPTIONS TO PURCHASE 900,000 SHARES OF COMMON STOCK OF
THE COMPANY (THE "INITIAL GRANT") UPON THE TERMS OF A STOCK OPTION AGREEMENT
BETWEEN THE COMPANY AND EMPLOYEE SUBSTANTIALLY IN THE FORM OF EXHIBIT A-1.
THE
COMPANY'S 1994 STOCK OPTION PLAN, AS AMENDED JULY 8, 2002 (THE "STOCK OPTION
PLAN"), PURSUANT TO WHICH THE SHARE OPTIONS WERE GRANTED TO EMPLOYEE, IS
ATTACHED HERETO AS EXHIBIT A-2.
SUCH OPTIONS AND ADDITIONAL OPTIONS TO PURCHASE
COMMON STOCK OF THE COMPANY WHICH ARE AT ANY TIME OR FROM TIME TO TIME
OUTSTANDING AND UNEXERCISED ARE COLLECTIVELY REFERRED TO HEREIN AS "OUTSTANDING
SHARE OPTIONS."
3
(II)
ANY OPTIONS GRANTED TO EMPLOYEE BY THE COMPANY AFTER THE INITIAL
GRANT SHALL BE ON THE SAME