Document:

Letter dated December 6, 2002 from PMI Mortgage Insurance Co.

 Exhibit 10.38 
  
 [Letterhead] 
  
 December 6, 2002 
  
 Dear Mr. Lofe, 
  
 We would like to extend an offer of employment to you effective January 6, 2003 as the EVP, Chief Financial Officer with PMI Mortgage Insurance Co. We feel your
experience will provide needed expertise in our company and, in turn, we believe the Company can provide you with opportunities for personal, professional, and financial growth. Below is a summary of our offer: 
  

	 	•	 	Your salary will be $300,000 annually, payable semi-monthly 

  

	 	•	 	You will participate in the Key Management Annual Incentive Plan. The target is 70% of base salary and maximum of 140%, (subject to compensation committee approval for all senior
officers). Target is paid at 125% of bonus opportunity. 

  

	 	•	 	You will participate in the Long Term Incentive Plan at 150% of base salary, subject to compensation committee approval regarding all senior officers 

  

	 	•	 	You will receive 5,000 new hire stock options (1/3 vesting schedule) 

  

	 	•	 	You will receive 5,000 Restricted Shares (3 year cliff vesting) 

  

	 	•	 	PMI will provide you a relocation package that includes: 

  

	 	1.	Signing Bonus of $150,000 (reimbursable to PMI on a pro-rata basis upon voluntary termination within twelve months of hire date) This bonus will be included as pensionable earnings
and used as highest bonus earned for change of control purposes. 

  

	 	2.	Relocation differential of $110,000 (payable upon move) 

  

	 	3.	Reimbursement of expenses (per relocation policy) to sell home in Chicago and buy a home in California. 

  

	 	4.	Move of household goods 

	 	•	 	PMI will reimburse (as a business expense) through June 30, 2003: (a) temporary housing expense up to $2,500 per month and (b) travel up to 12 round trip business class tickets.

  

	 	•	 	100% company funded Pension Plan – at one year anniversary. 

  

	 	•	 	401(K) eligibility effective immediately. Company match up to 100% of employee contributions to 6%. The first 25% is credited as cash. The remaining 75% is discretionary based on
the same corporate objectives used to determine the Annual Incentive Plan payout. The discretionary component will be credited as stock. 

  

	 	•	 	Health benefits, including Medical, Dental, Vision, Long Term Disability, Life Insurance, Accidental Death, and Flexible Spending Accounts. 

  

	 	•	 	PMI will provide you: 

  

	 	1.	A company Car allowance of $16,200 annually 

  

	 	2.	Cellular Phone (valued at $650 annually) 

  

	 	3.	Financial Planning and Tax Preparation ($16,500 annually) 

  

	 	•	 	You will be eligible for four weeks of vacation, 3 personal days and 8 paid holidays 

  

	 	•	 	Upon employment, you will be provided the standard Change in Control Agreement, as outlined in the 12/31/01 proxy 

  
 We look forward to a mutually productive relationship and welcome you to the PMI Group, Inc.
Please fill out and return the enclosed application for employment with one signed copy of this letter. 
  
  

							
	 Sincerely,
	 	 	 	 	 	 
				
	 /s/ W. Roger Haughton

	 	 	 	 	 	 
	 W. Roger Haughton
	 	 	 	 	 	 
	 Chairman and Chief Executive Officer
	 	 	 	 	 	 
				
	 /s/ Donald P. Lofe, Jr.

	 	 	 	 	 	 December 12, 2002

	 Donald P. Lofe, Jr.
	 	 	 	 	 	 DateCopy of Alberto-Culver Company Employee Stock Option Plan of 2003, as amended

 Exhibit 10(a) 
  
 ALBERTO-CULVER COMPANY 
 EMPLOYEE
STOCK OPTION PLAN OF 2003 
  
 (as amended through February
20, 2004) 
  

	1.	Purpose of ACSOP 

  
 The Alberto-Culver Company Employee Stock Option Plan of 2003 (hereinafter called the “ACSOP”) is intended to encourage ownership of the Common
Stock of Alberto-Culver Company (the “Company”) by eligible key employees of the Company and its subsidiaries and to provide incentives for them to make maximum efforts for the success of the business. Options granted under the ACSOP will
be non-qualified options (not incentive options as defined in Section 422 of the Internal Revenue Code of 1986 and the rules and regulations promulgated thereunder (the “Code”)). 
  

	2.	Eligibility 

  
 Key employees of the Company and its subsidiaries who perform services which contribute materially to the management, operation and development of the
business (“Optionees”) will be eligible to receive options under the ACSOP. At their request, Mr. Leonard H. Lavin and Mrs. Bernice E. Lavin are ineligible to receive options under the ACSOP. 
  

	3.	Administration 

  
 The Compensation Committee of the Board of Directors of the Company (the “Committee”) shall have full power and authority, subject to the
express provisions of the ACSOP, to determine the purchase price of the stock covered by each option, the Optionees to whom and the time or times at which options shall be granted, the terms and conditions of the options, including the terms of
payment thereof, and the number of shares of stock to be covered by each option. The Committee shall have full power to construe, administer and interpret the ACSOP, and full power to adopt such rules and regulations as the Committee may deem
desirable to administer the ACSOP. No member of the Committee shall be liable for any action or determination made in good faith with respect to the ACSOP or any option thereunder. The determination of the Committee as to any disputed question
arising under the ACSOP, including questions of construction and interpretation, shall be final, conclusive and binding. 
  
 The Committee may, in its discretion, delegate to a committee of member(s) of the Committee its authority with respect to such matters under the ACSOP and
options granted under the ACSOP as the Committee may specify. 
  
 The Committee shall be comprised solely of members each of whom shall be an “outside director” within the meaning of Section 162(m) of the Code, and a “non-employee director” within the meaning of Section 16 of the
Securities Exchange Act of 1934 and the rules and regulations thereunder (“Section 16”), provided, however, that if any member of the 

  

 
Committee is not (i) an “outside director” within the meaning of Section 162(m) of the Code or (ii) a “non-employee director” within the
meaning of Section 16, the Committee shall set up a subcommittee comprised solely of outside directors and non-employee directors for purposes of all matters arising under this ACSOP involving “officers” within the meaning of Rule 16a-1(f)
under Section 16, and “covered employees” within the meaning of Section 162(m) of the Code for the plan year at issue. 
  

	4.	Number of Shares of Stock to be Offered 

  
 The Committee may authorize from time to time the issuance pursuant to the ACSOP of shares not to exceed 9,000,000 of the Company’s Common Stock in
the aggregate, subject to adjustment under paragraph 10 hereof. Such shares of Common Stock which may be issued pursuant to options granted under the ACSOP may be authorized and unissued shares or issued and reacquired shares as the Committee from
time to time may determine. If any option granted under the ACSOP shall terminate or be surrendered or expire unexercised in whole or in part, the shares of stock so released from such option may be made the subject of additional options granted
under the ACSOP. In addition, any shares of Common Stock withheld to pay, in whole or in part, the amount required to be withheld under applicable tax laws in accordance with paragraph 7(d) hereof, may be made the subject of additional options
granted under the ACSOP. 
  

	5.	Option Price 

  
 The purchase price under each option granted pursuant to the ACSOP shall be determined by the Committee but shall not be less than the Fair Market Value
(as defined below) of the Company’s Common Stock at the time the option is granted. For purposes of the ACSOP, “Fair Market Value” shall mean the average of the high and low transaction prices of a share of Common Stock of the Company
as reported in the New York Stock Exchange Composite Transactions on the date as of which such value is being determined or, if there shall be no reported transactions for such date, on the next preceding date for which transactions were reported.

  

	6.	Grant of Options 

  
 The Committee may not grant to any individual Optionee in any fiscal year an option or options with respect to more than 600,000 shares of Common Stock.

  

	7.	Term and Exercise of Options 

  
 (a) Each option granted shall provide that it is not exercisable after the expiration of ten (10) years from the date the option is granted, or such
shorter period as the Committee determines, and each option shall be subject to the following limitations upon its exercise: 
  

	 	(i)	Except as otherwise provided in paragraph 11(a) hereof, no option may be exercised until the day preceding the anniversary date of the grant of the option. 

 

 2 

	 	(ii)	Except as otherwise provided in paragraph 11(a) hereof, on the day preceding the anniversary date of the grant of the option in each of the four calendar years immediately following
the year of the grant of the option, the right to purchase twenty-five percent (25%) of the total number of shares of stock specified in the option shall accrue to the Optionee. Subject to paragraph 8 hereof, each such right to purchase such
twenty-five percent (25%) may be exercised, in whole or in part, at any time after such right accrues and prior to the expiration of the term of the option. 

  
 (b) Notwithstanding the foregoing or paragraph 8 hereof, the Committee may in its discretion (i) specifically provide at the
date of grant for another time or times of exercise; (ii) at any time prior to the expiration or termination of any option previously granted, accelerate the exercisability of any option subject to such terms and conditions as the Committee deems
necessary or appropriate to effectuate the purpose of the ACSOP including, without limitation, a requirement that the Optionee grant to the Company an option to repurchase all or a portion of the number of shares acquired upon exercise of the
accelerated option for their Fair Market Value on the date of grant; or (iii) at any time prior to the expiration or termination of any option previously granted, extend the term of any option (including such options held by officers or directors)
for such additional period as the Committee, in its discretion, shall determine. In no event, however, shall the aggregate option period with respect to any option, including the original term of the option and any extensions thereof, exceed ten
years. 
  
 (c) An option may be exercised (subject to the receipt
of payment) by giving written notice to the Secretary of the Company specifying the number of shares to be purchased. The full purchase price for such shares may be paid (i) in cash, (ii) by check, (iii) by delivery of previously owned shares of
Common Stock, or (iv) by a combination of these methods of payment. However, under no circumstances may any Optionee deliver previously owned shares of Common Stock obtained from the exercise of stock options under any option plan of the Company or
the vesting of shares restricted under any restricted stock plan of the Company or the Management Bonus Plan during the six months immediately preceding the exercise date. Payment must be received by the Secretary of the Company before any exercise
is consummated. For purposes of the delivery of previously owned shares of Common Stock, the per share value of such shares shall be the Fair Market Value on the date of exercise. 
  
 (d) At any time when an Optionee is required to pay to the Company an amount required to be withheld under applicable tax
laws in connection with the exercise of an option (calculated by taking the minimum statutory withholding rates for federal, state and local tax purposes including payroll taxes, applicable to the income generated by the Optionee by such exercise),
the Optionee may satisfy this obligation (i) in cash, (ii) by check, (iii) by delivery of previously owned shares of Common Stock, (iv) by making an election to have the Company withhold shares of Common Stock, or (v) by a combination of these
methods of payment, in each case having a value equal to the amount required to be withheld. The Optionee must specify the method of satisfying this obligation on or before the date of exercise. The value of the shares to be withheld or delivered
shall be based on the Fair Market Value of the Common Stock on the date of exercise. 
  

 3 

	8.	Continuity of Employment 

  
 (a) Each option shall be subject to the following in addition to the restrictions set forth in paragraphs 6 and 7 hereof: 
  

	 	(i)	If an Optionee dies without having fully exercised his or her option, the executors or administrators of his or her estate or legatees or distributees shall have the right during
the one (1) year period following his or her death (but not after the expiration of the term of such option) to exercise such option in whole or in part but only to the extent that the Optionee could have exercised it at the date of his or her
death. 

  

	 	(ii)	If an Optionee’s termination of employment is due to disability, the Optionee’s option shall terminate one (1) year after his or her termination of employment (but not
after the expiration of the term of such option) and may be exercised only to the extent that such Optionee could have exercised it at the date of his or her termination of employment. For purposes of the ACSOP, “disability” shall have the
meaning provided in the Company’s applicable long-term disability plan and such disability continues for more than three months or, in the absence of such a definition, when an Optionee becomes totally disabled as determined by a physician
mutually acceptable to the Optionee and the Committee before attaining his or her 65th birthday and if such total
disability continues for more than three months. Disability does not include any condition which is intentionally self-inflicted or caused by illegal acts of the Optionee. 

  

	 	(iii)	Subject to the third sentence of this paragraph 8(a)(iii), if an Optionee’s termination of employment is due to retirement, all options (or portions thereof) which are (a)
vested at the time of retirement may be exercised for a period of two (2) years following retirement (but not after the expiration of the term of the option) and (b) unvested at the time of retirement may be exercised for a period of five (5) years
from the date of grant (but not after the expiration of the term of the option). Subject to the third sentence of this paragraph 8(a)(iii), following retirement, options (or portions thereof) which are unvested at the time of retirement will
continue to vest under such options’ vesting schedule for a period of five (5) years following retirement. Only for options granted in January, 2003, if an Optionee’s termination of employment is due to retirement (as defined in the ACSOP
prior to January 1, 2004), such option shall terminate one (1) year after his or her termination of employment (but not after the expiration of the term of such option) and may be exercised only to the extent that such Optionee could have exercised
such option at the date of his or her termination of employment. For purposes of the ACSOP, “retirement” shall be reached when an Optionee’s employment terminates and at the time of such termination the sum of such Optionee’s age
and years of service as an employee of the Company equals or exceeds 75 years. 

  

	 	(iv)	 If an Optionee’s termination of employment is for any reason other than death, retirement or physical disability, the Optionee’s option shall terminate
upon said 

  

 4 

	 	 
termination of employment; provided, however, that if such termination of employment occurs following a Change in Control (as such term is defined in
paragraph 11(b) hereof), the Optionee’s option shall terminate three (3) months after his or her termination of employment (but not after the expiration of the term of such option) and may be exercised to the extent that such Optionee could
have exercised it at the date of his or her termination of employment. 

  
 (b) Nothing contained in the ACSOP or any option granted pursuant to the ACSOP shall confer upon any Optionee any right to be continued in the employment of the Company or any subsidiary or shall prevent the Company
or any subsidiary from terminating an Optionee’s employment at any time, with or without cause. The determination by the Committee of whether an authorized leave of absence constitutes a termination of employment shall be final, conclusive and
binding. 
  

	9.	Non-Transferability of Options 

  
 An option granted under the ACSOP shall not be assignable or transferable by an Optionee otherwise than by will or the laws of descent and distribution,
and an option shall be exercisable during the lifetime of the Optionee only by him or her. An option transferred by will or the laws of descent and distribution may only be exercised by the legatee or distributee during the one year period following
the Optionee’s death and may only be exercised to the extent it was exercisable by the Optionee prior to his or her death. 
  

	10.	Adjustment upon Change in Stock 

  
 Each option, the number and kind of shares subject to future options and the number of shares subject to options that may be granted to an Optionee in any
fiscal year under the ACSOP may be adjusted, as may be determined to be equitable in the sole and absolute discretion of the Committee, in the event there is any change in the outstanding Common Stock, or any event that could cause a change in the
outstanding Common Stock, including, without limitation, by reason of a stock dividend, recapitalization, reclassification, issuance of Common Stock, issuance of rights to purchase Common Stock, issuance of securities convertible into or
exchangeable for Common Stock, merger, consolidation, stock split, reverse stock split, spin-off, combination, exchange or conversion of shares, or any other similar type of event. The Committee’s determination of any adjustment pursuant to
this paragraph10 shall be final, conclusive and binding. 
  

	11.	Change in Control 

  
 (a) (1) Notwithstanding any provision of the ACSOP, in the event of a Change in Control, all outstanding options shall immediately be exercisable in full
and shall be subject to the provisions of paragraph 11(a)(2) or 11(a)(3), to the extent that either such paragraph is applicable. 
  
 (2) Notwithstanding any provision of the ACSOP, in the event of a Change in Control in connection with which the holders of shares of the
Company’s Common 

  

 5 

 
Stock receive shares of common stock that are registered under Section 12 of the Exchange Act, all outstanding options shall immediately be exercisable in
full and there shall be substituted for each share of the Company’s Common Stock available under the ACSOP, whether or not then subject to an outstanding option, the number and class of shares into which each outstanding share of the
Company’s Common Stock shall be converted pursuant to such Change in Control. In the event of any such substitution, the purchase price per share of each option shall be appropriately adjusted by the Committee or the committee to which
authority has been delegated pursuant to paragraph 3 hereof, such adjustments to be made without an increase in the aggregate purchase price. 
  
 (3) Notwithstanding any provision in the ACSOP, in the event of a Change in Control in connection with which the holders of the
Company’s Common Stock receive consideration other than shares of common stock that are registered under Section 12 of the Exchange Act, each outstanding option shall be surrendered to the Company by the holder thereof, and each such option
shall immediately be cancelled by the Company, and the holder shall receive, within ten (10) days of the occurrence of such Change in Control, a cash payment from the Company in an amount equal to the number of shares of the Company’s Common
Stock then subject to such option, multiplied by the excess, if any, of (i) the greater of (A) the highest per share price offered to stockholders of the Company in any transaction whereby the Change in Control takes place or (B) the Fair Market
Value of a share of the Company’s Common Stock on the date of occurrence of the Change in Control over (ii) the purchase price per share of the Company’s Common Stock subject to the option. The Company may, but is not required to,
cooperate with any person who is subject to Section 16 of the Exchange Act to assure that any cash payment in accordance with the foregoing to such person is made in compliance with Section 16 of the Exchange Act and the rules and regulations
thereunder providing for an exemption from Section 16(b) of the Exchange Act. 
  
 (b) “Change in Control” means: 
  
 (1) The occurrence of any one or more of the following events: 
  
 (A) The acquisition by any individual, entity or group (a “Person”), including any “person” within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act of beneficial ownership within the meaning of Rule 13d-3 promulgated under the Exchange Act of both (x) 20% or more of the combined voting power of the then outstanding securities of the Company
entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”) and (y) combined voting power of Outstanding Company Voting Securities in excess of the combined voting power of the Outstanding Company
Voting Securities held by the Exempt Persons (as such term is defined in paragraph 11(c)); provided, however, that a Change in Control shall not result from an acquisition of Company Voting Securities: 
  
 (i) directly from the Company, except as otherwise provided
in paragraph 11(b)(2)(A); 
  

 6 

 (ii) by the Company, except as otherwise provided in paragraph 11(b)(2)(B); 

 
 (iii) by an Exempt Person; 
  
 (iv) by an employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation controlled by the Company; or 
  
 (v) by any corporation pursuant to a reorganization, merger or consolidation involving the Company, if, immediately after such
reorganization, merger or consolidation, each of the conditions described in clauses (i) and (ii) of paragraph 11(b)(1)(C) shall be satisfied. 
  
 (B) The cessation for any reason of the members of the Incumbent Board (as such term is defined in paragraph 11(d)) to constitute at least
a majority of the Board of Directors of the Company (hereinafter called the “Board”). 
  
 (C) Consummation of a reorganization, merger or consolidation unless, in any such case, immediately after such reorganization, merger or
consolidation: 
  
 (i) more than 60% of the
combined voting power of the then outstanding securities of the corporation resulting from such reorganization, merger or consolidation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by
all or substantially all of the individuals or entities who were the beneficial owners of the combined voting power of all of the Outstanding Company Voting Securities immediately prior to such reorganization, merger or consolidation; and

  
 (ii) at least a majority of the members of
the board of directors of the corporation resulting from such reorganization, merger or consolidation were members of the Incumbent Board at the time of the execution of the initial agreement or action of the Board providing for such reorganization,
merger or consolidation. 
  

 7 

 (D) Consummation of the sale or other disposition of all or substantially all of the
assets of the Company other than (x) pursuant to a tax-free spin-off of a subsidiary or other business unit of the Company or (y) to a corporation with respect to which, immediately after such sale or other disposition: 
  
 (i) more than 60% of the combined voting power of the then
outstanding securities thereof entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners of the combined
voting power of all of the Outstanding Company Voting Securities immediately prior to such sale or other disposition; and 
  
 (ii) at least a majority of the members of the board of directors thereof were members of the Incumbent Board at the time of the
execution of the initial agreement or action of the Board providing for such sale or other disposition. 
  
 (E) Approval by the stockholders of the Company of a plan of complete liquidation or dissolution of the Company. 
  
 (2) Notwithstanding the provisions of paragraph 11(b)(1):

  
 (A) no acquisition of Company Voting
Securities shall be subject to the exception from the definition of Change in Control contained in clause (i) of paragraph 11(b)(1)(A) if such acquisition results from the exercise of an exercise, conversion or exchange privilege unless the security
being so exercised, converted or exchanged was acquired directly from the Company; and 
  
 (B) for purposes of clause (ii) of paragraph 11(b)(1)(A), if any Person (other than the Company, an Exempt Person or any employee benefit
plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company) shall, by reason of an acquisition of Company Voting Securities by the Company, become the beneficial owner of (x) 20% or more of the
combined voting power of the Outstanding Company Voting Securities and (y) combined voting power of Outstanding Company Voting Securities in excess of the combined voting power of the Outstanding Company Voting Securities held by the Exempt Persons,
and such Person shall, after such acquisition of Company Voting Securities by the Company, become the beneficial owner of any additional Outstanding Company Voting Securities and such beneficial ownership is publicly announced, such additional
beneficial ownership shall constitute a Change in Control. 
  

 8 

 (c) “Exempt Person” (and collectively, the “Exempt Persons”) means: 
  
 (1) Leonard H. Lavin or Bernice E. Lavin; 
  
 (2) any descendant of Leonard H. Lavin and Bernice E. Lavin
or the spouse of any such descendant; 
  
 (3) the
estate of any of the persons described in paragraph 11(c)(1) or (2); 
  
 (4) any trust or similar arrangement for the benefit of any person described in paragraph 11(c)(1) or (2); or 
  
 (5) the Lavin Family Foundation or any other charitable organization established by any person described in paragraph 11(c)(1) or (2).

  
 (d) “Incumbent Board” means those individuals who,
as of October 24, 2002, constitute the Board, provided that: 
  
 (1) any individual who becomes a director of the Company subsequent to such date whose election, or nomination for election by the Company’s stockholders, was approved either by the vote of at least a majority of
the directors then comprising the Incumbent Board or by the vote of at least a majority of the combined voting power of the Outstanding Company Voting Securities held by the Exempt Persons shall be deemed to have been a member of the Incumbent
Board; and 
  
 (2) no individual who was
initially elected as a director of the Company as a result of an actual or threatened solicitation by a Person other than the Board or the Exempt Persons for the purpose of opposing a solicitation by any other Person with respect to the election or
removal of directors, or any other actual or threatened solicitation of proxies or consents by or on behalf of any Person other than the Board or the Exempt Persons shall be deemed to have been a member of the Incumbent Board. 
  

	12.	Amendment and Discontinuance 

  
 The Committee or the Board, without further approval of the stockholders, may, at any time and from time to time, suspend or discontinue the ACSOP in
whole or in part or amend the ACSOP in such respects as the Committee or the Board may deem proper and in the best interests of the Company or as may be advisable, provided, however, that no suspension or amendment shall be made which would:

  

	 	(i)	Adversely affect or impair any option previously granted under the ACSOP without the consent of the Optionee, or 

  

	 	(ii)	Except as specified in paragraph 10, increase the total number of shares for which options may be granted under the ACSOP or decrease the minimum price at which options may be
granted under the ACSOP. 

  

 9

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00066-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00066-of-00352.parquet"}]]