Document:

Exhibit 10.33

 

Haas Publishing Companies, Inc.

3119 Campus Drive

Norcross, GA 30071

 

	
   

  	
  April 1, 1998

  

 

Mr. Robert Metz

President & CEO

 

Dear Bob:

 

In connection with your continuing employment with
Haas Publishing Companies, Inc. (“the Company”), this letter will constitute
our agreement relating to amounts and benefits owing to you in connection with
any termination of your employment.

 

In the event that we terminate your employment without
cause at any time after the date hereof, we will pay you as severance (i) an
aggregate amount equal to 18 months base salary at the rate being paid on the
date your employment is terminated by the Company (the “Date of Termination”),
less applicable withholdings, payable bi-weekly on the Company’s regularly
scheduled payroll dates and (ii) your target bonus under the Company’s
Executive Incentive Compensation Plan (“EICP”) for the portion of the year
worked from the beginning of the calendar year in which the termination occurs
to the Date of Termination, less applicable withholdings, payable no later than
March 31 of the year following the year in which your termination
occurred. Any EICP bonus for completed calendar years unpaid at the Date of
Termination shall be paid in full in accordance with the EICP.

 

No severance payments whatsoever shall be payable upon
your voluntary resignation or upon termination of your employment for cause.
For purposes of this letter, “cause” shall mean substance abuse, conviction of
a felony, fraud, theft, embezzlement, sexual harassment, or willful or repeated
failure or refusal to follow reasonable policies or directives established by
your supervisor or the Board of Directors of the Company.

 

As consideration for the severance and benefits to be
provided to you pursuant to this letter and as a condition to your receipt of
any payments hereunder, you agree to execute a separation and release agreement
substantially in the form attached hereto in which you will agree to release
any claims against the Company.

 

 

The severance arrangements set forth above shall be in
lieu of and not in addition to any other severance policies of the Company
which may be in effect generally from time to time.

 

Both parties agree that any disputes hereunder shall
be heard and determined by an arbitrator selected in accordance with the rules
and procedures of the American Arbitration Association in New York City and
that the arbitrator’s findings shall be final and binding on both parties
hereto.

 

This letter and its validity, interpretation, performance,
and enforcement shall be governed by the laws of the State of New York.

 

This letter constitutes our entire agreement,
supersedes all prior agreements between us which are of no further force and
effect. The provisions of this letter may not be changed or waived, except by a
writing signed by both parties hereto.

 

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Beverly Chell

  	
   

  
	
   

  	
  Beverly Chell

  
	
   

  	
  Vice Chairman

  

 

 

FORM

OF 

SEPARATION AND RELEASE AGREEMENT

 

This Separation and Release Agreement (“Agreement”) by
and
between                                           (“Employee”)
and                                            (the
“Company”), dated as
of                                             and
executed on the date specified below (the date of execution by the Employee
hereinafter referred to as the “Execution Date”).

 

RECITAL

 

Employee and Company desire to reach a mutual
understanding and acceptance of the terms and conditions related to Employee’s
separation from employment with Company in accordance with the terms of the
letter delivered by the Company to the Employee covering among other things the
amount of severance payable to the Employee upon termination by the Company
without cause (the “Severance Letter”).

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the mutual promises
and covenants herein contained it is hereby agreed as follows:

 

1.                                      
Employee shall cease
to be an employee of Company as of
                            (“Separation
Date”) and shall be paid Employee’s normal salary through that date plus any
accrued but unused vacation.

 

2.                                      
In consideration of
Employee’s acceptance of this Agreement, on the eighth (8) day following the
execution of this Agreement by Employee, Employee shall be

 

 

entitled
to receive from the Company (i) an aggregate amount equal
to                         
weeks’ base salary at Employee’s current rate
of                                  per
annum ($ in the aggregate), less customary payroll deductions, payable
bi-weekly on Company’s regular pay dates and (ii) any additional amounts as set
forth in the Severance Letter.

 

3.                                      
From and after the
Separation Date, Employee shall cease to be an active participant in any
Company benefit plans in which the Employee participates. Benefit payouts, if
any, and COBRA will be in accordance with the provisions of the respective
plans and applicable laws except as specifically provided otherwise in the Severance
Letter.

 

4.                                      
Employee agrees that
the Company is authorized to open any and all business mail addressed to
Employee at the Company’s address. Employee further understands and agrees that
the Company will not be responsible for forwarding mail.

 

5.                                      
Employee for
Employee, Employee’s heirs, executors, administrators and assigns, hereby
unconditionally releases, discharges and acquits Company, its subsidiaries,
parents, and affiliates, and each of them, and their respective officers,
directors, shareholders, partners, employees, agents and affiliates, and each
of them (hereinafter collectively referred to as “Releasees”) from any and all
debts, agreements, promises, liabilities, claims, damages, actions, causes of
action, or demands of any kind or nature including without limitation all
claims of wrongful discharge, breach of contract, intentional infliction of
emotional distress, breach of alleged implied covenant of good faith and fair
dealing, invasion of privacy, defamation, and age or sex discrimination, or
discrimination based on any other ground, including but not limited to those
arising under the Age Discrimination in Employment Act, as amended, Title VII
of the Civil Rights Act of 1964, the Employee Retirement Income Security

 

2

 

Act of 1974, the Fair
Labor Standards Act, as amended, the Americans with Disabilities Act and the
Family and Medical Leave Act of 1993 and all other federal, state and local
equal employment, fair employment, civil or human rights laws, codes and
ordinances, regardless of whether such claims are past, present, or future,
personal or representative, known or unknown, or arising out of any occurrence
to date and expressly including but not limited to any liability arising out of
or in connection with the employment of Employee by Company, or the termination
hereof, and claims for attorneys’ fees and costs, and any and all forms of
compensation, including without limitation any incentive awards or bonuses,
relating to such employment, other than as set forth in paragraph 2 of this
Agreement.

 

6.                                      
It is understood and
agreed that the release set forth in the preceding paragraph is intended as and
shall be deemed to be a full and complete release of any and all claims that
Employee may or might have against Releasees, or any of them, arising out of
any occurrence arising on or before the date of this Agreement and said release
is intended to cover and does cover any and all future damages not now known to
Employee or which may later develop or be discovered, including all causes of
action therefor and arising out of or in connection with any occurrence arising
on or before the date of this Agreement.

 

7.                                      
By signing and
returning this Agreement, Employee acknowledges that Employee:

 

(a)                                 
has carefully read
and fully understands the terms of this Agreement;

 

(b)                                
is entering into this
Agreement voluntarily and knowing that Employee is releasing claims that
Employee has or believes Employee may have against Company;

 

3

 

(c)                                 
has hereby been
advised by this Agreement that Employee has the right to consult with an
attorney of Employee’s choosing prior to signing this Agreement; and

 

(d)                                
is giving this
release of claims in return for consideration to which Employee otherwise would
not have been entitled, to wit, any compensation and benefit enhancements
beyond those that Employee would otherwise be entitled to pursuant to the
Company’s policies and practices.

 

8.                                      
Employee hereby
covenants not to sue or bring any claim against Releasees and acknowledges and
agrees that this general release may be pleaded as a full and complete defense
to, and may be used as the basis for an injunction against, any action, claim,
suit or other proceeding which may be instituted, prosecuted or attempted in
breach of this release.

 

9.                                      
Employee promises not
to make any statement, written or oral, directly or indirectly, which in any
way disparages Company or any of its affiliates or their publications, or the
employees, officers, directors or shareholders of any of them. Employee
promises to maintain this Agreement in strict confidence and to make no
disclosure of the terms of this settlement to any third party, provided,
however, that nothing herein contained shall prohibit Employee from disclosing
the terms of this Agreement as may be required by law. Notwithstanding anything
herein to the contrary, the foregoing shall in no way limit the effect of the
release set forth above.

 

10.                                
Except as
specifically set forth in this Agreement to the contrary, Employee agrees to
return all Company property in Employee’s possession to Company on or before
the Separation Date. Employee acknowledges receipt of the Notice on Conclusion
of

 

4

 

Employment,
attached hereto as Exhibit “A”. Employee understands and agrees that any
disclosure in contravention of this Agreement or Notice on Conclusion of
Employment may release Company from any obligations it may have to Employee
under this Agreement.

 

11.                                
This Agreement sets
forth the entire agreement between the parties regarding Employee’s separation
from Company, supersedes any prior written, oral or implied agreement between
the parties hereto regarding the subject matter hereof and may only be amended
by a written agreement signed by the parties hereto.

 

12.                                
Employee agrees and
understands that neither the content nor the execution of this Agreement shall
constitute or be construed as any implied or actual admission by Company of any
liability to or of the validity of any claim by Employee that Employee is
entitled to additional compensation or continued employment with the Company or
that the Company engaged in any wrongdoing.

 

13.                                
Employee hereby
represents and agrees that in entering into this Agreement, Employee has relied
solely upon Employee’s own judgment, belief and knowledge and Employee’s own
legal and other professional advisors and that no statement made by or on
behalf of Company has in any way influenced Employee in such regard.

 

14.                                
Employee hereby
represents and warrants to Company that Employee has not assigned any claim
Employee may or might have against Company to any third party.

 

15.                                
Each party shall pay
its own attorneys’ fees, costs and expenses related to this Separation and
Release Agreement.

 

16.                                
This Agreement shall
be governed by and construed in accordance with the laws of the State of New
York.

 

5

 

17.                                
It is agreed by each
of the parties hereto that they have read the above and fully understand the
terms of this Agreement which they voluntarily execute in good faith and deem
to be a full and equitable settlement of this matter.

 

18.                                
The provisions of
this Separation and Release Agreement are severable. If any provision of the
Separation and Release Agreement is declared invalid or unenforceable, the
ruling will not affect the validity and enforceability of any other provision
of the Separation and Release Agreement.

 

19.                                
Employee may review
and consider this Agreement for a period of up to twenty-one (21) days from the
date of this Agreement. Employee agrees and understands that Employee’s failure
to execute this Agreement and to return this signed document on or before
twenty-one (21) days after the date of this Agreement will release Company from
any obligation to enter into this Agreement and make any payments under the
Severance Letter.

 

20.                                
Furthermore, Employee
shall be entitled to revoke this Agreement within seven (7) days after
Employee’s timely execution of same by delivering a written revocation to
Company. If Employee so revokes or if Employee fails to execute this document,
this Agreement shall be null and void and of no force and effect and the
Company will have no obligation to make any payments under the Severance
Letter, and Employee will receive severance payments equal to one week’s base
salary for each year employed by Company, less regular payroll deductions,
payable in bi-weekly installments on Company’s regular pay dates, in accordance
with Company’s regular severance practice.

 

6

 

Agreed
and Accepted:

 

 

	
   

  	
   

  	
  Dated:

  	
   

  	
   

  
	
  Employee’s signature

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Agreed and Accepted for
  the Company.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  Dated:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

7

 

EXHIBIT “A”

 

NOTICE ON CONCLUSION OF EMPLOYMENT

 

In connection with the
conclusion of employment with PRIMEDIA Inc., and/or its subsidiaries and
affiliates (“Company”), each employee has an obligation to surrender and return
to Company all mail, files, records, manuals, books, blank forms, tapes, discs,
photographs, negatives, documents, letters, memoranda, notes, notebooks,
materials, property, reports, data tables, calculations, information or copies
thereof, which are the property of Company or which relate in any way to  the business, products, practices or
techniques of Company and all other property, trade secrets or confidential
information of Company and any third parties with whom it deals, including but
not limited to, all keys, passwords, combinations and documents which in any of
these cases are in the employee’s possession or under the employee’s control.

 

The employee also has a
continuing obligation to preserve as CONFIDENTIAL
and refrain from using, trade secrets or confidential information
concerning the business, products, practices or techniques of Company and any
third parties with whom it deals, including but not limited to, manuscripts,
photographs, techniques, systems, designs, research, processes, inventions,
developments, proposals, plans, publications, computer programs, user manuals
and documentation, products (whether or not copyrighted or copyrightable, or
patented or patentable), marketing and merchandising methods, subscriber,
circulation, customer or supplier lists, business, accounting and financial
information of Company, that has been disclosed to or is known to the Employee
by reason of employment by Company, and to refrain from acts or omissions that
would reduce the value of such trade secrets and confidential information to
company.

 

8TRANSITION AND
RETIREMENT AGREEMENT 

        THIS
TRANSITION AND RETIREMENT AGREEMENT (the “Agreement”) entered into on September
22, 2004, by and between COVENTRY HEALTH CARE INC., a Delaware corporation (the
“Company”), with its principal office in Bethesda, Maryland, and Allen F. Wise,
a resident of Potomac, Maryland (:Executive”). 

        WHEREAS,
Executive is the Chief Executive Officer of the Company and a member of its Board of
Directors (the “Board”) and is the subject of an employment agreement entered
into with the Company on December 18, 2000 (the “Prior Agreement”); and 

        WHEREAS,
Executive has announced his intention to retire on August 21, 2007 (the “Retirement
Date”) and Executive and the Board have determined that it is in the best interest of
the Company for Executive to cease to be Chief Executive Officer on January 1, 2005, be
employed by the Company as its non-executive Chairman, assist his successor to achieve
success in his new position and then retire on the Retirement Date; and 

        WHEREAS,
in consideration of the years of valuable service provided by Executive to the Company and
his agreement to cooperate with the Company in transitioning his duties to his successor
and to provide the Company with covenants against competition, solicitation of employees
and disclosure of confidential information, both parties desire to enter into an agreement
that will reflect the compensation and other benefits to which Executive will be entitled
by reason of his retirement and the other agreements between the parties; 

        NOW,
THEREFORE, the parties hereto, intending to be legally bound, hereby agree as follows: 

         1.       
          Effectiveness of the Agreement. Except as specifically provided herein,
          the Prior Agreement shall remain in effect until December 31, 2004, and from and
          after that date shall be superceded by this Agreement and be of no further force
          or effect. 

         2.       
          Transition of Duties and Retirement. Effective on January 1, 2005,
          Executive shall resign all positions (including without limitation all officer
          and director positions) with the Company and its subsidiaries except that
          Executive shall be the non-executive Chairman (“Chairman”) of the
          Company and shall remain a member of the Board for his current term and all
          subsequent terms for which he is elected by the shareholders of the Company. In
          his role as Chairman, executive shall continue as an employee of the Company and
          shall perform those duties reasonably requested of him by the Board or the
          Company’s Chief Executive Officer within the scope of Executive’s
          business experience and expertise, except that such duties shall not conflict
          with any subsequent business activities that Executive, in his sole discretion,
          determines to pursue. Executive and the Company agree that Executive shall
          retire on the Retirement Date and that Executive shall then be considered to
          have retired for all Company purposes, including all plans, benefits and
          programs which the Company maintains or has maintained and in which Executive
          participated during the term of his employment by the Company. Until the
          Retirement Date, Company shall furnish Executive with secretarial support
          comparable to the level he currently enjoys for up to 15 hours per week. 

         3.       
          Payments, Benefits and Indemnification. 

         (a)       
          Pursuant to the prior Agreement, Executive shall continue to serve as President
          and Chief Executive Officer and receive his regular base salary, annual
          incentive and long-term incentives and continue to participate in all benefit
          plans and programs of the Company and to receive all perquisites through
          December 31, 2004. On and after January 1, 2005, the Company shall provide
          Executive with the compensation, benefits and perquisites set forth on Exhibit A
          to this Agreement, which is incorporated herein by reference. Executive and the
          Company acknowledge that Exhibit A is a complete and accurate summary of
          Executive’s expected rights and benefits under the Company’s benefit
          plans and programs due to Executive under this Agreement. 

         (b)       
          All of Executive’s options to purchase shares of the Company shall continue
          to vest in accordance with their terms and shall be fully vested and
          non-forfeitable on the Retirement Date. All such options shall be
          exercisable upon retirement as provided by their terms and the Company’s
          Amended and Restated 1998 Stock Incentive Plan. 

         (c)       
          The restricted stock awards granted to Executive in 2002 and 2003 shall continue
          to vest in accordance with their terms and shall be fully vested and
          non-forfeitable on the Retirement Date. If the performance conditions designated
          for the restricted stock awards granted to Executive in 2004 are met, those
          awards shall continue to vest in accordance with their terms and shall be fully
          vested in June, 2007. 

         (d)       
          Executive shall continue during the term of this Agreement and after the
          Retirement Date to retain his rights to indemnification by the Company, or
          through any insurance purchased by the Company, to the maximum extent that
          Executive would have been entitled to indemnification at any time during his
          employment by the Company as set forth in Section 6.1 of the Prior Agreement. 

         (e)       
          As soon as practicable following the execution of this Agreement, the Company
          shall pay Executive’s counsel all documented legal fees and expenses
          arising in representing Executive in the preparation of this Agreement and,
          particularly, in advising Executive as to the consequences to him of Sections 3
          and 4 of this Agreement. 

    4.       
Restrictive Covenants.

         (a)       
          Confidential Information. The provisions of Section 5.3 of the Prior
          Agreement shall continue in full force and effect. 

         (b)       
          Non-Compete. Executive will not “Compete with the Company,” as
          defined in Section 5.4 of the Prior Agreement, prior to the Retirement Date. 

         (c)       
          Non-Solicitation. Prior to the Retirement Date, without the
          Company’s permission, Executive will not solicit,hire or encourage
          any managerial or higher level employee of the Company, or of any of its
          affiliates or subsidiaries, to accept employment with an entity other than the
          Company unless that individual’s employment with the Company has been
          severed more than 12 months prior thereto. 

         5.       
          Notices. All notices and other communications required or permitted under
          this Agreement or necessary or convenient in connection herewith shall be in
          writing and shall be deemed to have been given when hand delivered or mailed by
          registered or certified mail, or by overnight mail or fax, as follows (provided
          that notice of change of address shall be deemed given only when received): 

    If
to the Company, to:

      COVENTRY
HEALTH CARE INC.
      6705 Rockledge Drive, Suite 900
      Bethesda, Maryland 20817
        Attention:
President 

    With
a copy to: 

     Bass,
Berry & Sims PLC315 
     Deaderick Street, Suite 2700

     Nashville, TN 37238-3001

       Attention:
Bob F. Thompson, Esquire

    
If to Executive, to:

     Allen F. Wise

     114000 Glenn Road
     Potomac, MD 20854 

    With
a required copy to: 

     Morgan,
Lewis & Bockius LLP 
     1701 Market Street

     Philadelphia, PA 19103
      Attention:
Robert J. Lichtenstein, Esquire 

or to such other names or addresses
as the Company or Executive, as the case may be, shall designate by notice to each other
person entitled to receive notices in the manner specified in this Section. 

         6.       
          Subsequent Statements; Non-Disparagement. Executive and the Company agree
          to mutually develop any oral or written statements to be given as to the terms
          and reasons for Executive’s retirement and separation from the Company and
          to Executive’s performance while an executive of the Company. Nothing
          contained herein shall limit communication in connection with enforcing the
          terms of this Agreement. Executive and the Company, acting through it directors,
          officers and employees, each agree not to disparage or impugn the character or
          reputation or business practices of the other. 

         7.       
          Contents of Agreement; Amendment and Assignment. 

         (a)       
          This Agreement supersedes all prior agreements, including the Prior Agreement
          except to the extent set forth herein, except the plans and programs listed on
          Exhibit A to the extent set forth in this document or in Exhibit A, and
          otherwise sets forth the entire understanding between the parties hereto with
          respect to the subject matter hereof and cannot be changed, modified, extended
          or terminated except upon written amendment approved by the Board and executed
          on its behalf by a duly authorized representative and by Executive. 

         (b)       
          All of the terms and provisions of this Agreement shall be binding upon and
          inure to the benefit of and be enforceable by the respective heirs, executors,
          administrators, legal representatives, successors and assigns of the parties
          hereto, except that the duties and responsibilities of Executive under this
          Agreement are of a personal nature and shall not be assignable or delegatable in
          whole or in part by Executive. 

         8.       
          Severability. If any provision of this Agreement or application thereof
          to anyone or under any circumstances is adjudicated to be invalid or
          unenforceable in any jurisdiction, such invalidity or unenforceability shall not
          affect any other provision or application of this Agreement which can be given
          effect without the invalid or unenforceable provision or application and shall
          not invalidate or render unenforceable such provision or application in any
          other jurisdiction. If any provision is held void, invalid or unenforceable with
          respect to particular circumstances, it shall nevertheless remain in full force
          and effect in all other circumstances. 

        9.       
          Remedies Cumulative; No Waiver. No remedy conferred upon a party by this
          Agreement is intended to be exclusive of any other remedy, and each and every
          such remedy shall be cumulative and shall be in addition to any other remedy
          given under this Agreement or now or hereafter existing at law or in equity. No
          delay or omission by a party in exercising any right, remedy or power under this
          Agreement or existing at law or in equity shall be construed as a waiver
          thereof, and any such right, remedy or power may be exercised by such party from
          time to time and as often as may be deemed expedient or necessary by such party
          in its sole discretion. 

         10.       
          Death Benefits. In the event of Executive’s death prior to the
          Retirement Date, the provisions of this Agreement shall continue in full force
          and effect and all payments and benefits due under Section 2 of this Agreement,
          including Exhibit A, shall be paid to Executive’s beneficiary(ies), when
          otherwise due in accordance with this Agreement without regard to
          Executive’s death and no pro-ration shall apply by reason of his death.
          Executive shall be entitled to select and change a beneficiary or beneficiaries
          to receive that payment following Executive’s death by giving the Company
          written notice thereof. In the event of Executive’s death or a judicial
          determination of his incompetence, reference in this Agreement to Executive
          shall be deemed, where appropriate, to refer to his beneficiary(ies), estate or
          other legal representative. 

         11.       
          Withholding. The Company may withhold from any payments under this
          Agreement the Withholding Taxes. Executive shall bear all expense of, and be
          solely responsible for, all federal, state and local taxes due with respect to
          any payment received under this Agreement. 

         12.       
          Miscellaneous. All section headings used in this Agreement are for
          convenience only. This Agreement may be executed in counterparts, each of which
          is an original. It shall not be necessary in making proof of this Agreement or
          any counterpart hereof to produce or account for any of the other counterparts. 

         13.       
          Governing Law. This Agreement shall be governed by and interpreted under
          the laws of the state of Maryland without giving effect to any conflict of laws
          provisions. 

        IN
WITNESS WHEREOF, the parties, intending to be legally bound, have executed this Agreement
as of the date first above written. 

COVENTRY HEALTH CARE INC. 

	By     
    /s/ John H. Austin 	 /s/ Allen F. Wise 
	 	ALLEN F. WISE

EXHIBIT A 

     A.    
          January 1 to December 31, 2005: 

         1.       
          $750,000 base salary 

         2.       
          Coventry Health Care Inc. Executive Management Incentive Plan (“MIP”),
          incentive for 2004 determined by the Compensation Committee of the Board (the
          “Committee”), with the incentive payment made in 2005, i.e., no
          deferral of payment 

         3.       
          Continued participation in the: 

         a.       
          Coventry Health Care Inc. 2005 MIP, incentive determined by the Committee,
          taking into account, in evaluating 2005 results, the contribution to the
          business by Executive in 2004, with 50% of the full bonus paid in February, 2006
          and the remaining 50% deferred into the ERP for distribution no later than July
          1, 2006 with performance goals mutually agreed upon between Executive and the
          Company 

         b.       
          Coventry Health Care Inc. Executive Retention Plan (the “ERP”) with a
          minimum cash award of 55% plus 50% match in phantom shares to be consistent with
          that awarded to other senior executives – all benefits to be fully vested
          on the Retirement Date based on performance goals mutually agreed upon between
          Executive and the Company and ultimately paid in cash in July, 2006 

         c.       
          Coventry Health Care Inc. Supplemental Executive Retirement Plan (the
          “SERP”) with all contributions made by or credited to Executive fully
          vested no later than the Retirement Date 

         d.       
          All employee benefit programs, plans and arrangements maintained by the Company
          for employees or executives generally or for certain specific executives
          including Executive, including up to $12,000 for legal, tax and financial
          planning (the “Financial Allowance”), an automobile at a level equal
          to that currently enjoyed by Executive (the “Auto Allowance”), and up
          to 75 hours of personal airplane useage (the “Airplane Allowance”)
          plus a tax equalization bonus paid to Executive such that there is no net cost
          to Executive of the Financial Allowance, the Auto Allowance or the Airplane
          Allowance for any taxes that would be due. 

     B.    
          January 1 to December 31, 2006: 

         1.       
          $750,000 base salary 

         2.       
          Continued participation in the: 

         a.       
          The SERP with all contributions made by or credited to Executive fully vested no
          later than the Retirement Date. 

         b.       
          All employee benefit programs, plans and arrangements maintained by the Company
          for employees or executives generally or for certain specific executives
          including Executive, including the Financial Allowance, the Auto Allowance and
          the Airplane Allowance plus a tax equalization bonus paid to Executive such that
          there is no net cost to Executive of the Financial Allowance, the Auto Allowance
          or the Airplane Allowance for any taxes that would be due. 

     C.    
          2007 

         1.       
          The Airplane Allowance plus a tax equalization bonus paid to Executive such that
          there is no net cost to Executive of the Airplane Allowance for any taxes that
          would be due. 

    2.
       Director fees

     D.    
          The Company shall reimburse Executive for all expenses reasonably incurred by
          him during his employment in the performance of services under the Agreement,
          within 15 days of receipt by the Company of invoices setting forth a description
          of the items for which reimbursement is sought together with the cost or fair
          market value of such items and copies of invoices, receipts, credit card
          statements or other appropriate supporting documentation.

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