Document:

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                                                                   EXHIBIT 10.23

                                 ENDOLOGIX, INC.

                       2004 PERFORMANCE COMPENSATION PLAN

      This 2004 PERFORMANCE COMPENSATION PLAN (the "Plan") is hereby established
by Endologix, Inc., a Delaware corporation (the "Company"), effective as of
January 5, 2004 (the "Effective Date").

                                    ARTICLE 1

                               PURPOSE OF THE PLAN

      1.1 PURPOSE. The Plan is hereby established by the Company for the purpose
of providing deferred compensation for certain employees who are highly
compensated employees. The deferred compensation that a Participant may receive
pursuant to the Plan will be based upon the appreciation, if any, in the value
of the Performance Units granted to the Participant that occurs from the value
placed on such Performance Units as determined by the Committee (as hereinafter
defined) at the time the Performance Units are granted and the date of a
Distribution Event (as hereinafter defined in this Plan), which will be based
upon the value of the shares of the Company's common stock determined in the
manner set forth in Section 2.9 of this Plan.

      1.2 NATURE OF THE PLAN. The Plan is intended to be an unfunded plan within
the meaning of the Employee Retirement Income Security Act of 1974 ("ERISA").
Accordingly, it is intended that the Plan be exempt from the requirements of
Parts II, III and IV of Title I of ERISA pursuant to Sections 201(2), 301(3)
and 401(1) of ERISA.

                                    ARTICLE 2

                                   DEFINITIONS

      2.1 ACCOUNT. "Account" means the bookkeeping entry for a Participant that
is established under Section 4.2 of the Plan for the purpose of maintaining the
amount of Performance Units granted to a Participant by the Company.

      2.2 AWARD NOTICE. "Award Notice" shall mean a written notice from the
Company to each Participant, which shall be substantially in the form of Exhibit
C to this Plan and is entitled "Notice of Award of Performance Units", and by
which each Participant is notified of an award of Performance Units under this
Plan to him or her by the Company. Each Award Notice shall specify, among other
things, the number of Performance Units awarded, the vesting schedule applicable
to such Performance Units, any terms or conditions applicable to the vesting of
such Units or payment of Distribution Event Benefits. No award of Performance
Units under the Plan shall be effective
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until an Award Notice with respect thereto, that has been completed in
accordance with rules or regulations that have been promulgated by the Committee
in its sole and absolute discretion and has been executed by the Company, is
delivered to the Participant and the Participant acknowledges, in writing or by
return to the Company of a duplicate copy of the Award Notice executed by him or
her, his or her receipt of a copy of this Plan and his or her acceptance of the
terms and conditions applicable to the Performance Units being awarded thereby
as set forth in this Plan and in the Award Notice with respect thereto.

      2.3 CHANGE IN CONTROL. "Change in Control" means:

            (A) A merger or consolidation approved by the Company's stockholders
in which securities possessing more than fifty percent (50%) of the total
combined voting power of the Company's outstanding securities are transferred to
a person or persons different from the persons holding those securities
immediately prior to such transaction; or

            (B) The sale, transfer or other disposition of all or substantially
all of the Company's assets in complete liquidation or dissolution of the
Company approved by the Company's stockholders.

      2.4 COMMITTEE. "Committee" means the committee designated to administer
the Plan in accordance with Article 7. The initial or first Committee designated
to administer the Plan is set forth in Exhibit A hereto.

      2.5 DISABILITY. "Disability" means the inability of a Participant to
engage in his usual occupation by reason of a medically determinable physical or
mental impairment as determined by the Company on the basis of advice from a
physician or physicians.

      2.6 DISTRIBUTION EVENT. "Distribution Event" means, with respect to a
Participant, the earliest to occur of any of the following:

            (A) Any Change in Control;

            (B) A Separation from Service of such Participant as a result of the
termination of such Participant's employment for any reason other than a
termination of Participant's employment by the Company for any of the reasons
constituting "Cause" which, for purposes of this Plan, shall mean any
termination of a Participant's employment for any of the reasons set forth in
Attachment A to such Participant's Award Notice, even if and notwithstanding
that such Participant is employed under an employment agreement with the Company
which defines "Cause" more narrowly or restrictively than it is defined in
Attachment A to his or her Award Notice; or

            (C) The receipt of a "Notice of Exercise" (in substantially the form
attached hereto as Exhibit D) by the Company from a Participant at any time
after the expiration of eighteen (18) months from the date of the grant of the
Performance Units to such Participant (the "Eighteen Month Anniversary"),
provided that no other Distribution Event has occurred between the date of grant
and such Eighteen Month Anniversary.

      2.7 DISTRIBUTION EVENT BENEFIT. "Distribution Event Benefit" means the
amount by which (a) the Fair Market Value of the vested Performance Units held
in a Participant's Account on

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the date of the Distribution Event exceeds (b) the Base Value (as hereinafter
defined in Section 5.1) ascribed to such vested Performance Units by the
Committee at the time of their grant.

      2.8 FAIR MARKET VALUE. "Fair Market Value" when used with reference to a
Performance Unit means the fair market value of a share of common stock of the
Company, as determined by the Company's Board of Directors, as follows:

            (A) If shares of common stock of the Company are listed or admitted
to trading on one or more national securities exchanges, the average of the last
reported sales prices of shares of the Company's common stock or, in case no
such reported sale takes place on any such day, the average of the last reported
bid and asked prices of the shares of common stock of the Company, in either
case, on the principal national securities exchange on which such shares are
listed or admitted to trading, for the twenty (20) trading days immediately
preceding the date upon which the Fair Market Value is determined (the
"Determination Date");

            (B) If such shares are not listed or admitted to trading on a
national securities exchange, but are quoted by the NASD Automated Quotation
System ("Nasdaq"), the average of the last reported sales prices of the common
stock regular way or, in case no reported sale takes place on any such day or
the last reported sales prices are not then quoted, the average of the closing
bid prices of shares of the common stock for the twenty (20) trading days
immediately preceding the Determination Date, as furnished by the National
Quotation Bureau Incorporated, or such other nationally recognized quotation
service as may be selected by the Company if such bureau is not at the time
furnishing quotations; and

            (C) If the shares are not listed or admitted to trading on a
national securities exchange or quoted by Nasdaq or any other nationally
recognized quotation service, the Fair Market Value will be the fair value of
shares common stock as determined in good faith by the Company's Board of
Directors, in its sole and absolute discretion.

      The Board of Directors may, from time to time, revise the foregoing
methods of determining the Fair Market Value, provided, however, that no such
revision shall adversely affect the holders of Performance Units that are then
outstanding.

      2.9 PARTICIPANT. "Participant" means an individual who is an employee of
the Company and has been designated by the Company as an individual eligible to
participate in the Plan.

      2.10 PERFORMANCE UNIT. "Performance Unit" means a unit used by the Plan
for the purpose of measuring a Participant's Distribution Event Benefit if such
Participant is an employee of the Company on the date that any Distribution
Event occurs. For purposes of the Plan, a Participant shall be deemed an
employee on the date of his or her Separation from Service, except that if any
such Separation from Service is due to termination of Participant's employment
by the Company for "Cause" as Cause is defined in Attachment A to such
Participant's Award Notice, then, for purposes of this Plan, the last day of
Participant's employment with the Company shall be deemed to be the day prior to
the date of such Separation from Service.

      2.11 SEPARATION FROM SERVICE. "Separation from Service" means the
termination of the Participant's employment with the Company for any reason,
including his death, retirement, Disability or the termination of the
Participant's employment by the Company, for or without Cause, or by the
Participant. For purposes of this Plan, in determining whether the Company's
termination

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of a Participant's employment was made for "Cause," Cause shall be defined in
the manner set forth in Attachment A of the Award Notice and not as it is
defined in any employment agreement between the Participant and the Company, and
any termination of a Participant's employment by the Company for any of the
reasons set forth in Attachment A to his or her Award Notice shall, for purposes
of this Plan, constitute a termination of Participant's employment for Cause.

                                    ARTICLE 3

                                  PARTICIPATION

      3.1 ELIGIBILITY. The Committee in its sole discretion may designate those
of the management or highly compensated employees, within the meaning of ERISA,
of the Company to participate in the Plan. The persons eligible to participate
in the Plan as of the Effective Date are those individuals set forth on Exhibit
B attached hereto and incorporated herein by this reference.

                                    ARTICLE 4

                           GRANTS OF PERFORMANCE UNITS

      4.1 GRANTING OF PERFORMANCE UNITS. The Committee in its sole discretion
shall determine the number of Performance Units to be granted to each
Participant and to determine the time or times when Performance Units will be
granted. An award of Performance Units to a Participant shall be evidenced by an
Award Notice as provided in Section 2.2 hereof.

      4.2 PARTICIPANT ACCOUNTS. The Committee shall establish and maintain in
its books and records a separate, unfunded Account for the purpose of recording
the value of each Participant's Performance Units under the Plan. The Account
shall be a bookkeeping entry and shall not entitle any Participant to any asset
or assets of the Company.

      4.3 BENEFITS UNFUNDED. The benefits under this Plan shall not be funded,
but shall constitute an unsecured liability payable, when due, by the Company
out of its general assets. Each Participant is required to rely solely upon the
Company's unsecured promise to pay the benefits. In the event of a bankruptcy or
insolvency of the Company, each Participant will be only a general creditor of
the Company with respect to his benefits under the Plan.

                                    ARTICLE 5

                         VALUATION OF PERFORMANCE UNITS

      5.1 VALUE UPON GRANT. Within thirty days of the grant of any Performance
Unit or Units to any Participant, the Committee shall provide such Participant
with a notice setting forth the value that the Committee, in its sole and
absolute discretion, has ascribed, as of the date of grant, to each such
Performance Unit. Such value per Unit (the "Base Value") may be less than, equal
to or greater than, the Fair Market Value of a share of common stock of the
Company as of the date of grant, which shall be determined in the manner set
forth in Section 2.8 hereof (as the same may be

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amended from time-to-time by the Committee as provided therein). The Committee
shall maintain adequate records of its determinations with respect to the Base
Value of each Performance Unit granted under this Plan.

      5.2 VALUE UPON PAYMENT OF ACCOUNT. In the event a Distribution Event
occurs with respect to a Participant, the Committee shall provide the
Participant with a notice setting forth the Fair Market Value of each of his or
her vested Performance Units as of the date of the Distribution Event and the
amount of the Distribution Event Benefit that will become payable to the
Participant.

                                    ARTICLE 6

         VESTING; TERMINATION OF PERFORMANCE UNITS; PAYMENT OF BENEFITS

      6.1 VESTING AND TERMINATION OF PERFORMANCE UNITS. A Participant's
Performance Units shall vest in accordance with the vesting schedule set forth
in his or her Award Notice. If, as to a Participant, there is a Separation from
Service prior to a Distribution Event for any reason whatsoever, and whether for
or without Cause, then, all Performance Units that had not become vested on or
before the day prior to the date of the Separation from Service shall
automatically terminate and no Distribution Event Benefit or other benefit shall
be or become payable in respect thereof. If, as to a Participant, there occurs a
Separation from Service due to a termination of Participant's employment by the
Company for Cause, as "Cause" is defined in Attachment A to such Participant's
Award Notice, then, notwithstanding any provision of this Plan to the contrary,
such Participant's vested Performance Units, in addition to the Performance
Units that are unvested, shall automatically terminate upon such Separation from
Service and such Participant shall not be entitled to any Distribution Event
Benefit or other benefit under this Plan.

      6.2 DISTRIBUTION OF BENEFITS. Following the occurrence of a Distribution
Event applicable to any Participant, and provided that the Participant was an
employee of the Company on the date of the occurrence of such Distribution
Event, the Participant shall become entitled to receive the Distribution Event
Benefit that is payable in respect of his or her vested Performance Units, net
of any amounts required to be withheld as provided in Section 6.5 hereof
("Withholdings"), as follows:

            (A) If the Distribution Event is a Change of Control, the
Distribution Event Benefit, net of Withholdings, shall be payable by the Company
within ninety (90) days after the consummation of such Change of Control;

            (B) If the Distribution Event is Participant's Separation from
Service for any reason other than a termination of Participant's employment by
the Company for Cause, the Distribution Event Benefit, net of Withholdings,
shall be payable by the Company within ninety (90) days after the Participant's
Separation from Service; and

            (C) If the Distribution Event is the receipt of a Notice of Exercise
by the Company from a Participant at any time after the expiration of eighteen
(18) months from the date of the grant of the Performance Units to such
Participant (the Eighteen Month Anniversary), and provided that no other
Distribution Event has occurred between the date of grant and such Eighteen

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Month Anniversary, the Distribution Event Benefit, net of Withholdings, shall be
payable by the Company within ninety (90) days after the Company's receipt of
the Notice of Exercise.

      Notwithstanding the foregoing, payment of any Distribution Event Benefit
by the Company may be deferred or delayed for good cause. As used herein "good
cause" shall mean any legitimate reason for such delay such as limitations upon
available cash to the Company, limitations imposed upon the Company under any
loan or credit or other agreement with an unrelated third party, other than a
Person that is participating or is a party to a Change of Control of the Company
or any other good faith reasonable cause for such delay, as determined in good
faith by the Committee. Payment of the Distribution Event Benefit shall be in
the form of cash.

      6.3 PAYMENT OF BENEFITS. All payments under the Plan shall be delivered in
person or mailed to the last address of a Participant. Each Participant shall be
responsible for furnishing the Company with the Participant's correct current
address.

      6.4 CLAIMS PROCEDURE. In the event a Participant's claim for benefit is
denied (in whole or in part), the denial and the appeal of the decision shall be
handled in accordance with the provisions of Department of Labor Regulation
2560.503-1.

      6.5 WITHHOLDING. The Company shall make provision for the reporting and
withholding of any federal, state or local taxes that may be required to be
withheld with respect to the payment of any amounts under this Article. Any
amounts so withheld shall be paid to the appropriate taxing authorities.

                                    ARTICLE 7

                               PLAN ADMINISTRATION

      7.1 PLAN ADMINISTRATION.

            (A) Authority to control and manage the operation and administration
of the Plan shall be vested in the Committee, which shall be the Named Fiduciary
of the Plan (within the meaning of Section 402(a) of ERISA). The Committee shall
have all powers necessary to supervise the administration of the Plan and
control its operations.

            (B) In addition to any powers and authority conferred on the
Committee elsewhere in the Plan or by law, the Committee shall have the
following powers and authority:

                  (I) To designate agents to carry out responsibilities relating
to the Plan;

                  (II) To administer, interpret, construe and apply this Plan
and to answer all questions which may arise or which may be raised under this
Plan by a Participant, his beneficiary or any other person whatsoever;

                  (III) To establish rules and procedures from time to time for
the conduct of its business and for the administration and effectuation of its
responsibilities under the Plan; and

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                  (IV) To perform or cause to be performed such further acts as
it may deem to be necessary, appropriate, or convenient for the operation of the
Plan.

            (C) Any action taken in good faith by the Committee in the exercise
of authority conferred upon it by this Plan shall be conclusive and binding upon
a Participant and his beneficiaries. All discretionary powers conferred upon the
Committee shall be absolute.

      7.2 COMPOSITION OF COMMITTEE. The Committee shall be composed of the two
(2) individuals holding the titles of the Executive Chairman of the Board and
the Chief Executive Officer of the Company. Should the title of Executive
Chairman of the Board and Chief Executive Officer ever be held by the same
individual, the Board of Directors shall, in its sole and absolute discretion,
appoint a second individual to serve on the Committee, or the Board of Directors
may designate itself and function as the Committee.

      7.3 MULTIPLE FIDUCIARY CAPACITIES. Any person or group of persons may
serve in more than one fiduciary capacity with respect to the Plan.

      7.4 INDEMNIFICATION. No employee of the Company, member of the Committee
nor member of the Board of Directors for the Company shall be subject to any
liability with respect to his duties under the Plan unless the person acts
fraudulently or in bad faith. To the extent permitted by law, the Company shall
indemnify each member of the Committee and the Board of Directors, and any other
employee of the Company who performs any duties under or with respect to the
Plan who was or is a party, or is threatened to be made a party, to any
threatened, pending or completed proceeding, whether civil, criminal,
administrative, or investigative, by reason of the person's conduct in the
performance of any duties under or with respect to the Plan.

      7.5 PLAN ADMINISTRATOR. Notwithstanding anything in this Plan to the
contrary, the "Plan Administrator" (within the meaning of Section 3(16)(A) of
ERISA) shall be the Company.

                                    ARTICLE 8

                              MISCELLANEOUS MATTERS

      8.1 AMENDMENT AND TERMINATION. The Company reserves the right to amend,
modify, or terminate the Plan at any time, but any such amendment, modification
or termination shall not adversely affect any Performance Units, or the rights
of Participants with respect thereto, which had been awarded prior thereto.

      8.2 ADJUSTMENTS UPON CHANGES IN CAPITAL STRUCTURE. In the event that the
outstanding shares of common stock of the Company are hereafter increased or
decreased or changed into or exchanged for a different number or kind of shares
or other securities of the Company by reason of a recapitalization, stock split,
combination of shares, reclassification, stock dividend or other change in the
capital structure of the Company, then appropriate adjustments shall be made by
the Administrator to the number of shares and the price per share subject to the
unexercised portion of outstanding Award Notices in order to preserve, as nearly
as practical, but not to increase, the benefits to Participants under the Plan.

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      8.3 BENEFITS NOT ALIENABLE. Benefits under the Plan may not be assigned or
alienated, whether voluntarily or involuntarily.

      8.4 NO ENLARGEMENT OF EMPLOYEE RIGHTS. This Plan is strictly a voluntary
undertaking on the part of the Company and shall not be deemed to constitute a
contract between the Company and a Participant or to be consideration for, or an
inducement to, or a condition of, the employment of any Participant. Nothing
contained in the Plan shall be deemed to give the right to a Participant to be
retained in the employ of the Company or to interfere with the right of the
Company to discharge a Participant at any time.

      8.5 ARBITRATION. Any controversy, dispute or claim arising out of or in
connection with or relating to this Plan will, after satisfying the requirements
of Section 6.5, be submitted by the parties to arbitration by the American
Arbitration Association in Orange County, California, in accordance with the
commercial rules then in effect for that Association. Each party shall choose
one arbitrator within thirty days of receipt of notice of the intent to
arbitrate. Within sixty days of receipt of the notice of intent to arbitrate,
the two arbitrators shall choose a neutral third arbitrator who shall act as
chairman. The award rendered by the arbitrators shall include costs of
arbitration, reasonable attorneys' fees and reasonable costs for expert and
other witnesses, and judgment upon such award may be entered in any court having
jurisdiction thereof.

      8.6 NONTRANSFERABILITY. Performance Units granted under the Plan and all
privileges pertaining thereto, may not be transferred, assigned, pledged or
hypothecated in any manner, by operation of law or otherwise, other than by will
or by the laws of descent and distribution, and shall not be subject to
execution, attachment or similar process.

      8.7 NO VOTING OR DIVIDEND RIGHTS. No Participant shall be entitled to any
rights of a stockholder of the Company, including, but not limited to, voting
rights, rights to receive any dividends or to have his Account credited or
increased as a result of any dividends or other distribution with respect to the
Company's common stock.

                            [Signature Page Follows]

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      IN WITNESS WHEREOF, the undersigned has caused this instrument to be
executed and become effective as of the     day of    , 20  .

                                    ENDOLOGIX, INC.

                                    By:
                                          ------------------------------------
                                          Its:
                                                ------------------------------

                                       9
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                                    EXHIBIT A

                        DESIGNATION OF INITIAL COMMITTEE

      Franklin Brown               Executive Chairman of the Board of Directors

      Paul McCormick               President & Chief Executive Officer

                                      A-1
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                                    EXHIBIT B

                              INITIAL PARTICIPANTS

                                      B-1
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                                    EXHIBIT C

                      NOTICE OF AWARD OF PERFORMANCE UNITS

<Insert Date>                                    Performance Unit Award No._____

                                 ENDOLOGIX, INC.

                      NOTICE OF AWARD OF PERFORMANCE UNITS

To:   <Insert Name of Participant>

      Endologix, Inc. (the "Company") hereby awards to _____________________
(the "Participant"), as of _________________________________ (the "Grant Date"),
___________________ Performance Units pursuant and subject to the terms and
conditions of Endologix, Inc. 2004 Performance Compensation Plan (the "Plan"), a
copy of which is attached. Terms in this Notice of Award that have initial
capital letters and that are not defined herein, unless the context indicates
otherwise, shall have the meanings set forth in the Plan.

      As of __________________________ , the value of each Performance Unit
granted to _________, as hereinabove provided, has been determined to be $
_______________ , which constitutes the Base Value of each such Performance Unit
(as defined in Section 5.1 of the Plan). For purposes of this award, the Base
Value has been determined by multiplying the fair market value of one share of
the Company's common stock on the Grant Date by fifty percent (50%).

      Your Performance Units shall vest as follows: One third (1/3) of the
Performance Units shall become Vested Performance Units on the first anniversary
of the Grant Date, and thereafter, the balance of the Performance Units shall
become Vested Performance Units in a series of eight (8) successive equal
quarterly installments for each full three-month period of your employment by
the Company, such that 100% of the Performance Units shall become Vested
Performance Units on the third (3rd) anniversary of the Grant Date.

      Notwithstanding the foregoing, in the event of a Change in Control of the
Company (as defined in Section 2.3 of the Plan), your unvested Performance Units
shall accelerate automatically and vest in full effective as of immediately
prior to the consummation of the Change in Control.

      You will be eligible to receive payment with respect to your vested
Performance Units upon the occurrence of a Distribution Event, as defined in
Section 2.6 of the Plan.

      Unvested Performance Units will terminate automatically on a Separation
from Service for any reason whatsoever. "Separation from Service" is defined in
Section 2.11 of the Plan. Vested Performance Units also shall terminate
automatically if your employment is terminated by the Company due to one of the
events constituting "Cause" as such term is defined in Attachment A to this
Notice of Award, even if you are employed under an employment agreement with the
Company

                                      C-1
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and such termination does not constitute a termination for "Cause" as
defined in such employment agreement.

      You may exercise your right to receive payment with respect to any or all
vested Performance Units after the eighteen (18) month anniversary of the Grant
Date by delivering a "Notice of Exercise" (in substantially the form as Exhibit
D attached hereto) to the Company at its principal executive offices. However,
in no event shall you be entitled to receive payment with respect to any
Performance Units which have not vested in accordance with this Award Notice.

      The award of Performance Units described in this Notice and the right to
receive payment of any Distribution Event Benefit in respect of such Performance
Units under the Plan is subject to all of the terms and conditions of the Plan
and those set forth in this Notice of Award.

        The grant of Performance Units described herein will not be effective
unless you acknowledge your receipt of this Notice and of a copy of the Plan and
your acceptance of the terms and conditions of the Plan and those set forth in
this Notice that are applicable to the Performance Units being awarded to you,
as evidenced hereby, by signing and then returning to the Company, to the
attention of the Chief Executive Officer, a duplicate copy of this Notice of
Award.

                                    ENDOLOGIX, INC.

Date:            , 200              By:
      -------- --     -                 ----------------------------------------
                                        Paul McCormick , Chief Executive Officer

      The undersigned acknowledges that he or she has received and read a copy
of the Plan and the terms and conditions set forth in this Notice of Award and
accepts the award of Performance Units set forth herein and agrees to the terms
and conditions of the Plan and those set forth in this Notice of Award and in
the Attachment hereto.

Date:            , 200
      -------- --     -                 ----------------------------------------

                                        Name of Participant:
                                                            --------------------
                                                                Please Print

                                      C-2
<PAGE>
                            ATTACHMENT A TO EXHIBIT C

CAUSE. "Cause" means, with respect to a Participant's employment with the
Company, the termination by the Company of Participant's employment for any of
the following reasons:

            (A) The continued, unreasonable refusal or omission by the
Participant to perform any material duties required of him by the Company if
such duties are consistent with duties customary for the position held with the
Company;

            (B) Any material act or omission by the Participant involving
malfeasance or gross negligence in the performance of Participant's duties to,
or material deviation from any of the policies or directives of, the Company;

            (C) Conduct on the part of Participant which constitutes the breach
of any statutory or common law duty of loyalty to the Company; or

            (D) Any illegal act by Participant which materially and adversely
affects the business of the Company or any felony committed by Participant, as
evidenced by conviction thereof.

                                      CA-1
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                                    EXHIBIT D

                     NOTICE OF EXERCISE OF PERFORMANCE UNITS

                 Name of Participant:
                                      -------------------------

Endologix, Inc.
13900 Alton Parkway, Suite 122
Irvine, California 92618

Gentlemen:

      I hereby exercise my right to receive payment for my vested Performance
Units pursuant to the Notice of Award of Performance Units dated              ,
200 , ("Notice of Award") awarded to me under the Endologix, Inc (the
"Company") 2004 Performance Compensation Plan. The number of Performance Units
that I wish to exercise at this time is          .

      In connection with the exercise of my Performance Units, I understand that
following the receipt of this Notice of Exercise by the Company, the number of
Performance Units indicated above will no longer be available for exercise under
the Notice of Award. I also understand that pursuant to section 6.5 of the Plan,
the Company shall withhold any federal, state or local taxes that are required
to be withheld in connection with payment by the Company with respect to the
Performance Units. Finally, I acknowledge that the Company has ninety (90) days
from its receipt of this Notice of Exercise to deliver payment with respect to
the number of Performance Units indicated above, and that payment may be delayed
for "good cause" pursuant to Section 6.2 of the Plan.

Dated:
       ---------------------             ------------------------------------
                                              (Signature of Participant)

                                         ------------------------------------
                                             (Print Name of Participant)

                                       D-1<PAGE>
                                                                   Exhibit 10.87

                                  SUPPLEMENT A
                           TO EMPLOYMENT AGREEMENT AND
                  TO SUPPLEMENTAL RETIREMENT BENEFITS AGREEMENT

This document constitutes Supplement A to both the Employment Agreement dated
March 31, 1992, as amended, between Chromcraft Revington, Inc. and Michael E.
Thomas and the Supplemental Retirement Benefits Agreement dated August 21, 1992,
as amended, between Chromcraft Revington, Inc. and Michael E. Thomas.

      THIS SUPPLEMENT A TO THE EMPLOYMENT AGREEMENT AND TO THE SUPPLEMENTAL
RETIREMENT BENEFITS AGREEMENT (the "Supplement"), both of such agreements being
between Chromcraft Revington, Inc. and Michael E. Thomas, is made and entered
into as of the 3rd day of March, 2004 by and between CHROMCRAFT REVINGTON, INC.
(the "Company"), a Delaware corporation, and MICHAEL E. THOMAS (the
"Executive"), a resident of the State of Indiana,

                                   WITNESSETH:

      WHEREAS, the Executive is currently employed by the Company in accordance
with an Employment Agreement dated March 31, 1992 (the "Original Employment
Agreement"), as amended by Amendment No. 1 to Employment Agreement dated March
15, 2002 between the Company and the Executive; this Supplement, upon execution
and delivery by the parties, shall be attached to the Original Employment
Agreement and shall supplement and further amend the Original Employment
Agreement as provided herein (the Original Employment Agreement, as amended by
Amendment No. 1 thereto and as supplemented and amended hereby is referred to
herein as the "Employment Agreement"); and

      WHEREAS, Section 4 of the Employment Agreement includes a provision for a
supplemental retirement benefit per year for the Executive upon his retirement
on or after attaining age sixty-five (65), which shall be funded by the Company
and which shall be offset by certain employer-provided benefits as provided in
this Supplement (the "SERP Benefit"); and

      WHEREAS, the Company and the Executive also entered into a Supplemental
Retirement Benefits Agreement dated August 21, 1992, as amended by the First
Amendment to Supplemental Retirement Benefits Agreement dated March 15, 2002;
this Supplement, upon execution and delivery by the parties, shall be attached
to the Supplemental Retirement Benefits Agreement and shall supplement and
further amend the Supplemental Retirement Benefits Agreement as provided herein
(the Supplemental Retirement Benefits Agreement, as amended by the First
Amendment thereto and as supplemented and amended hereby is referred to herein
as the "SERP Agreement"); and

      WHEREAS, the SERP Agreement provides for the purchase by the Company of a
life insurance policy to fund supplemental retirement (including the SERP
Benefit) and death benefits for the Executive, which policy is owned by the
Executive and, in connection therewith, the premiums on such policy are paid by
the Company; and

      WHEREAS, the Employment Agreement and the SERP Agreement are collectively
referred to herein as the "Agreements"; and

      WHEREAS, the Company and the Executive have determined that the retirement
benefit and certain other provisions of the Agreements are inconsistent and
outdated, lack clarity and/or are inadequate to enable them to determine the
form, time of payment, amount and funding status of the retirement benefits
provided for in the Agreements without supplementing and amending such
Agreements with this Supplement; and
<PAGE>
      WHEREAS, the Company and the Executive have determined that it is in their
mutual best interests to supplement and amend the Agreements as provided in this
Supplement.

      NOW, THEREFORE, in consideration of the foregoing premises, the mutual
covenants, agreements and obligations contained herein, the continued employment
of the Executive by the Company pursuant to the Employment Agreement, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company and the Executive, each intending to be legally
bound, hereby agree as follows:

      Section 1. Form and Time of Payment of SERP Benefit. Subject to the terms
and limitations of this Supplement, the SERP Benefit payable to the Executive
shall be an annual annuity for the Executive's lifetime commencing on the first
day of the sixth month following the first month in which (a) the Executive is
age sixty-five (65) (his "Normal Retirement Age") or older, and (b) the
Executive's employment with the Company is terminated, or has previously been
terminated, for any reason other than termination by the Company with cause (as
defined in the Employment Agreement). If the Executive's employment is
terminated by the Company with cause (as defined in the Employment Agreement),
whether before or after his Normal Retirement Age, then no SERP Benefit shall be
paid to the Executive as provided in Section 9 of this Supplement. If the
Executive's employment is terminated for any reason other than by the Company
with cause (including, without limitation, by death) prior to the time that
payment of the SERP Benefit commences, then the SERP Benefit shall be
calculated, funded and paid in accordance with the provisions of Sections 5, 6,
7 or 8 hereof, whichever may be applicable. The SERP Benefit shall be paid to
the Executive in equal semi-annual installments of one-half (-1/2) of the annual
SERP Benefit commencing as provided in the first sentence of this Section 1 and
continuing every six (6) months thereafter until the Executive's death. In all
cases, the SERP Benefit shall end on the date of the Executive's death, at which
time the SERP Benefit shall immediately cease and no further SERP Benefit shall
be paid.

Example:

Assuming that the Executive attained age 65 in January of a particular year,
that the Executive retired from the Company on March 7 of the same year and that
the annual SERP Benefit was $200,000, then the first installment equal to
$100,000 would be payable on September 1 of that year. The second installment
equal to $100,000 would be payable on March 1 of the following year. Subsequent
installments of $100,000 each would be payable on each September 1 and March 1
thereafter until the Executive's death, at which time the SERP Benefit shall
immediately cease.

      Section 2. Amount of SERP Benefit. Subject to the last sentence of this
Section 2, the amount of the "SERP Benefit" is the amount, if greater than zero,
equal to sixty percent (60%) of the Executive's SERP Compensation (as
hereinafter defined) reduced by (a) the Preliminary Annuity Amount (as
hereinafter defined), and (b) the annualized benefit payable to the Executive
under the Mohasco Plan (as hereinafter defined) in the year that the Executive's
employment with the Company is terminated. The SERP Benefit shall be calculated
within ninety (90) days following the Applicable Calculation Date (as
hereinafter defined).

      For purposes of this Supplement, "SERP Compensation" is equal to the
average of (y) the Executive's annual Base Salary (as defined in the Employment
Agreement), without any reduction for any pre-tax deferrals under any
tax-qualified or non-qualified Company-sponsored plan, plus (z) any annual cash
bonus under the Company's Short Term Executive Incentive Plan, as amended, and
any successor to such plan (the "STIP"), regardless of the payment level
thereunder, earned by the Executive during the three (3) full consecutive
calendar years immediately preceding the calendar year in which the Executive's
employment with the Company is terminated. Any cash bonus paid to the Executive
under the STIP in a particular calendar year that is attributable to the
preceding calendar year shall be considered to be earned only in such preceding
year and not in the year in which the bonus is paid. (For example, a cash bonus
under the STIP paid to the Executive in 2003 that is based upon performance
factors, standards and/or targets established for 2002 shall be deemed to be
earned in 2002 and not in 2003.) SERP Compensation shall not include any
payments from the Company to the Executive pursuant to Section 6 or Section 8 of
the Employment Agreement.

      For purposes of this Supplement, the "Mohasco Plan" is the Mohasco
Corporation Retirement Plan. Because the Executive's accrued benefit under the
Mohasco Plan is paid as a lifetime monthly annuity, the amount of the
Executive's annualized benefit payable under the Mohasco Plan shall be as
follows: (i) if the Executive's employment is
<PAGE>
terminated in 2004, the annualized benefit shall be Twenty-Eight Thousand
Dollars ($28,000), (ii) if the Executive's employment is terminated in 2005, the
annualized benefit shall be Twenty-Nine Thousand Dollars ($29,000), and (iii) if
the Executive's employment is terminated in 2006 or later, the annualized
benefit shall be Thirty Thousand Dollars ($30,000).

      Any benefits or amounts paid to the Executive under any other compensation
plan, program, arrangement or agreement (including without limitation the
Company's Long Term Executive Incentive Plan, as amended, and any successor to
such plan (the "LTIP"), any income recognized by the Executive on the exercise
of stock options and any reimbursement or gross-up for taxes of the Executive)
shall not be included in SERP Compensation.

      Notwithstanding the foregoing provisions of this Section 2, the
Executive's SERP Benefit prior to the reduction for the Preliminary Annuity
Amount and for the annualized benefit payable under the Mohasco Plan shall be
not less than Four Hundred Thousand Dollars ($400,000) per year.

      Section 3. Preliminary Annuity Amount; Applicable Calculation Date; Total
Offset Amount. The "Preliminary Annuity Amount" is the amount of the life
annuity (assuming payments to the Executive of equal semi-annual installments
commencing on the first day of the sixth month following the Applicable
Calculation Date and continuing every six (6) months thereafter until the
Executive's death) that can be purchased using the Total Offset Amount (as
hereinafter defined). The Preliminary Annuity Amount shall be calculated (a) by
the Company within ninety (90) days following the Applicable Calculation Date
using information reasonably available to it, and (b) by the Company selecting,
in its sole discretion, at least three (3) insurance or financial services
companies from which to obtain quotes for the Preliminary Annuity Amount, with
the lowest of such quotes being used when calculating the Preliminary Annuity
Amount. Each such insurance or financial services company shall have an insurer
financial strength rating from A.M. Best of "A," "A+" or "A++".

      The "Applicable Calculation Date" is the last day of the month in which
the later of the following occurs: (a) the date on which the Executive's
employment with the Company is terminated, or (b) if payments are made by the
Company (or its successors or assigns) to the Executive pursuant to Section 6 of
the Employment Agreement, then the date on which the last such payment is made.

      The "Total Offset Amount" is the total of all amounts paid or payable as
described in subsections (a) through (h) of this Section 3 (collectively, the
"Total Offset Amount") attributable to Company contributions or accruals,
whether made before or after the date of this Supplement.

      (a) Chromcraft Revington Savings Plan. The account balance of the
Executive as of the Applicable Calculation Date under the Chromcraft Revington
Savings Plan (the "Savings Plan") attributable to the following: (i) Company
matching contributions, including matching contributions made under the Mohasco
Corporation 401(k) Plan, (ii) assets transferred from the Chromcraft Revington
Retirement Plan, and (iii) any other employer contributions. Such account
balance shall not include any portion of the Executive's account balance under
the Savings Plan attributable to his pre-tax and after-tax deferrals and
contributions.

      (b) Predecessor Plans. The amount of Seven Hundred Eighty Thousand Three
Hundred Sixty-Two Dollars ($780,362) (the "Predecessor Plan Amount") plus all
investment earnings on such amount from December, 2002 through the Applicable
Calculation Date. The Predecessor Plan Amount constitutes the Executive's
aggregate account balance under various former benefit plans of the Company or
its predecessors.

      (c) Chromcraft Revington Employee Stock Ownership Plan. The account
balance of the Executive as of the Applicable Calculation Date under the
Chromcraft Revington Employee Stock Ownership Plan.

      (d) Value of Insurance. The greater of the (i) Cash Surrender Value (as
hereinafter defined) or (ii) Policy Account Value (as hereinafter defined), as
of the Applicable Calculation Date, of the variable life insurance policy (the
greater of (i) or (ii) being the "Policy Value") issued by The Equitable
Variable Life Insurance Company or any successor thereto ("Equitable") (Policy
Number 42-324-430) in the face amount of $1.5 million (the "Policy") paid for by
the Company and owned by the Executive under the Agreements plus the Tax
Effected Amount (as hereinafter defined). For purposes of this Supplement, the
(i) "Cash Surrender Value" is the cash surrender value of the Policy, as
calculated by Equitable, on the Applicable Calculation Date, (ii) "Policy
Account Value" is the policy account value of the Policy, as
<PAGE>
calculated by Equitable, on the Applicable Calculation Date, and (iii) "Tax
Effected Amount" is the amount of federal income and employment taxes and state
and local income taxes that the Executive would have been obligated to pay on
the Policy Value if the entire Policy Value were includible in his gross income
as compensation, for income and employment tax purposes, calculated based on the
highest marginal federal income tax rate, the Executive's share of any Medicare
tax and other applicable employment tax, and the highest Indiana and applicable
local income tax rates, all in effect on the Applicable Calculation Date.

      (e) Other Employer-Provided Retirement Benefits. The Executive's vested
benefit, if any, as of the Applicable Calculation Date attributable to Company
contributions or accruals under any employee benefit plan, program, arrangement
or agreement which the Company adopts, funds or sponsors after the date of this
Supplement.

      (f) Pre-Retirement Funding Amounts. The aggregate of all amounts paid by
the Company in satisfaction of its pre-retirement funding obligation pursuant to
Section 4(a) hereof to the extent that such amounts are not included in the
Policy Value.

      (g) Make-Whole Payments for 2002 Calendar Year and Subsequent Years. The
aggregate of all "make-whole" payments paid by the Company to the Executive
attributable to the 2002 calendar year and all subsequent years. Such
"make-whole" payments are the amounts that the Company could not contribute to
any of the Company's tax-qualified retirement plans on behalf of the Executive
because of the limits on retirement plan contributions imposed by the Internal
Revenue Code of 1986, as amended (the "Code"), and are included in the
Executive's Form W-2s provided by the Company each year.

      (h) Add-Back of Plan Payments and Withdrawals. The aggregate amount of all
loans, withdrawals, benefit distributions and payments (including, without
limitation, any amount of the Policy Value used to fund or purchase an annuity
providing survivor benefits pursuant to Section 5 hereof and any surrender or
cashing in of the Policy) to the Executive under the plans, programs,
agreements, insurance and payments described in subsections (a) through (g) of
this Section 3 which are made on or prior to the date that the SERP Benefit is
scheduled to commence shall be taken into account and included in the Total
Offset Amount. Any such amounts shall be calculated as of the date on which the
loans, withdrawals, benefit distributions and payments were made and shall be
adjusted for post-payment imputed interest, at a six percent (6%) per annum
interest rate, from the date of the loan, withdrawal, benefit distribution or
payment through the Applicable Calculation Date.

      (i) Direction of Investment. The Executive understands and agrees that the
Company's liability under the Agreements is directly related to the performance
of the investments held under the plans, programs, arrangements, agreements and
insurance described in subsections (a), (b), (c), (d), (e) and (f) of this
Section 3. The Executive also acknowledges that he contemplates retirement from
the Company on or before the date he attains age sixty-five (65) and that, in
view of his anticipated retirement, the Executive believes that the amounts
referred to in the preceding sentence should be invested, to the extent
possible, in income producing investments to preserve the principal of such
investments. The Executive therefore agrees to take all actions necessary to
invest (i) his directed account balance under the Savings Plan in either shares
of common stock of the Company or in the T. Rowe Price stable value fund offered
under the Savings Plan, (ii) the Predecessor Plan Amount plus all investment
earnings thereon in the American Century short-term government bond fund, (iii)
the Policy Value in the "guaranteed fund" offered under the Policy, and (iv) all
other items which comprise the Total Offset Amount or any of the Executive's
account balances under the plans, programs, arrangements, agreements and
insurance described in subsections (a), (b), (c), (d), (e) and (f) of this
Section 3 which cannot be invested as provided above and over which the
Executive can exercise investment control in income producing investments which
have as their respective purposes the preservation of principal, with a
preference for mutual funds or other investments comprised primarily of
short-term securities of the U.S. government and its agencies and
instrumentalities. The Executive shall take such actions and make such
investments within thirty (30) days of the date on which this Agreement is
executed.

      In consideration of the Company executing this Supplement and the
Company's obligations to fund any SERP Benefit, the Executive, for himself and
his heirs, personal representatives, successors and assigns, hereby forever
releases and discharges the Company, the Compensation Committee of the Company's
Board of Directors and the Company's directors, officers, employees, attorneys,
consultants and agents, from and against any reduction in value, loss, damage,
liability or other claim which may arise out of the investments made by the
Executive as a result of and in accordance with the requirements of this
subsection (i). The investment direction referred to in this subsection (i)
shall not apply to
<PAGE>
any amounts that are not included in the Total Offset Amount, such as the
Executive's pre-tax deferrals under the Top-Hat and Savings Plans. The Executive
agrees to execute any agreement or other document and to provide to the Company
with any information which the Company determines is necessary to the agreement
and intent of this subsection (i).

      Section 4. Funding of the SERP Benefit. The Company shall fund the SERP
Benefit in accordance with the provisions of this Section 4.

      (a) Pre-retirement Funding. During each calendar year prior to the
calendar year in which the Executive's employment with the Company is
terminated, the Company shall (i) pay into the Cash Surrender Value of the
Policy an amount equal to Two Hundred Thousand Dollars ($200,000) per year, but
only so long as and to the extent that (A) any such payment does not affect the
status of the Policy as a "life insurance contract" as described in Section
7702(a) of the Code, and (B) the Company reasonably believes that the SERP
Benefit shall, at the time of the Executive's retirement at his Normal
Retirement Age, be underfunded, and (ii) reimburse the Executive for the amount
of his taxes attributed to such payment into the Cash Surrender Value of the
Policy. All such payments into the Cash Surrender Value shall be in addition to
the Company's payment of the annual premium on the Policy and the gross-up for
taxes of the Executive related to such premium payment and shall be included in
the Policy Value. Notwithstanding the foregoing provisions of this Section 4(a),
any such payment into the Cash Surrender Value of the Policy, any such payment
of the premium on the Policy and any such gross-up for taxes of the Executive
shall be made only to the extent that the Company is not prohibited from
deducting the amount of any such payment and any related tax gross-up as
expenses of the Company for federal income tax purposes by virtue of Section
162(m) of the Code.

      (b) Post-retirement Funding. Subject to Section 4(e) hereof, during each
of the three (3) years following the Applicable Calculation Date, the Company
shall fund the SERP Benefit by purchasing a life annuity contract (payable to
the Executive in equal semi-annual installments commencing on the first day of
the sixth month following the month in which such later event occurs and
continuing every six (6) months thereafter until the Executive's death) equal in
each such year to one-third (-1/3) of the SERP Benefit from one of the insurance
or financial services companies which provided a quote for the Preliminary
Annuity Amount; provided, however, that instead of purchasing such life annuity
contract, the Company may, in its sole discretion, either pay into the Cash
Surrender Value of the Policy or pay in immediately available funds to the
Executive an amount equal to the lump sum required to purchase such life annuity
contract; and provided further, however, that the Company may, in its sole
discretion, accelerate the post-retirement funding of the SERP Benefit so long
as at least one-third of the SERP Benefit, two-thirds of the SERP Benefit and
the entire SERP Benefit is funded by the end of the first, second and third
anniversaries, respectively, of the Applicable Calculation Date. The Company
shall have no further funding obligation during any of such three (3) years once
the Company has fully funded the SERP Benefit by purchasing one or more annuity
contracts, by paying into the Cash Surrender Value of the Policy or by making
the payment to the Executive in accordance with this Section 4(b) and, in no
event, shall the Company be obligated to fund an amount in excess of the SERP
Benefit. During each of such three (3) years, the Company shall pay from its
general assets directly to the Executive the amount of the SERP Benefit payable
during any of such three (3) years that has not been funded as provided above.

      The distribution of any annuity contract to the Executive, the payment by
the Company into the Cash Surrender Value of the Policy or the payment of
immediately available funds to the Executive, as contemplated by this Section
4(b), shall constitute the payment of the SERP Benefit by the Company to the
Executive and, upon the SERP Benefit being fully funded as provided in this
Section 4(b), the Company's obligation to provide the SERP Benefit to the
Executive shall be fully satisfied and discharged.

      Notwithstanding the foregoing provisions of this Section 4(b), the
Company's obligation to complete the funding of the SERP Benefit shall
immediately terminate if the Executive dies (i) while employed by the Company,
(ii) during any period that the Executive is receiving payments from the Company
pursuant to Section 6 of the Employment Agreement, or (iii) during the
three-year funding period contemplated by this Section 4(b), the agreement of
the parties being that upon the Executive's death the SERP Benefit shall be
fully funded by the term life insurance contemplated by Section 4(f) hereof.

      Notwithstanding the foregoing provisions of this Section 4(b), the Company
shall pay into the Cash Surrender Value of the Policy only if such payments do
not affect the status of the Policy as a "life insurance contract" as described
in Section 7702(a) of the Code. All payments into the Cash Surrender Value, all
purchases of annuity contracts and all
<PAGE>
payments of immediately available funds to the Executive following the
termination of the Executive's employment with the Company (regardless of
whether any amounts under Section 6 of the Employment Agreement are paid to the
Executive) shall be made without any gross-up for taxes of the Executive.

      (c) Investment of Premiums and Additional Payments. All premiums on, and
all payments into the Cash Surrender Value of, the Policy paid by the Company
shall be invested by the Executive in accordance with Section 3(i) hereof.

      (d) Funding and SERP Benefit upon a Change in Control. Notwithstanding the
foregoing provisions of this Section 4, in the event the Executive terminates
his employment with the Company for Good Reason (as defined in the Employment
Agreement) after a Change in Control (as defined in the Employment Agreement),
the Company shall, within one hundred eighty (180) days following such
termination and subject to Section 4(e) hereof, fully fund the SERP Benefit
through (i) a purchase of a life annuity contract (using an insurance or
financial services company selected by the Company, in its sole discretion,
having an insurer financial strength rating from A.M. Best of "A", "A+," or
"A++") payable to the Executive in equal semi-annual installments of one-half
(-1/2) the annual SERP Benefit commencing on the first day of the sixth month
following the termination of the Executive's employment with the Company and
continuing every six (6) months thereafter until the Executive's death, or (ii)
either a payment into the Cash Surrender Value of the Policy or a payment in
immediately available funds to the Executive of an amount equal to the lump sum
required to purchase such annuity contract. If the Executive's last day of
employment with the Company is on a date that precedes the Executive's Normal
Retirement Age, then the SERP Benefit shall be calculated as provided in
Sections 2, 3 and 7 hereof. If the Executive's last day of employment with the
Company is on a date that follows the Executive's Normal Retirement Age, then
the SERP Benefit shall be calculated as provided in Sections 1, 2 and 3 hereof.

      (e) Certain Funding Suggestions of the Executive. The Company shall
provide the Executive with written notice at least thirty (30) days prior to any
purchase of an annuity, any payment into the Cash Surrender Value of the Policy
or any payment in immediately funds to the Executive as permitted under Section
4(b) or Section 4(d) hereof. For a period of thirty (30) days thereafter, the
Executive shall have the right to make suggestions to the Company as to whether
the Company shall make such a purchase of an annuity, such a payment into the
Cash Surrender Value of the Policy or such a payment in immediately available
funds to the Executive. The Company shall use its reasonable efforts to
implement such suggestions of the Executive only so long as the Executive's
suggestions have no actual or potential adverse financial, tax or other effect
on the Company; provided, however, that the Company shall have the right to make
the final decision with respect to any purchase of an annuity, any payment into
the Cash Surrender Value of the Policy or any payment in immediately available
funds to the Executive under Section 4(b) or Section 4(d) hereof in the event of
any disagreement as to any actual or potential adverse financial, tax or other
effect on the Company.

      (f) Certain Additional Life Insurance. From the date that this Supplement
is executed by the parties hereto until the SERP Benefit is fully funded as
provided in Section 4(b) or Section 4(d) hereof, the Company shall reimburse the
Executive for the actual premiums paid by him up to an amount not to exceed
Fifteen Thousand Dollars ($15,000) per calendar year for the purchase of term
life insurance covering the Executive's life. The Company shall also pay to the
Executive during each such calendar year an amount equal to the gross-up of his
taxes related to such premium reimbursement. The Executive shall own such term
life insurance policy and shall be responsible for paying all premiums thereon.
As soon as the SERP Benefit is fully funded in accordance with Section 4(b) or
Section 4(d) hereof, the Company shall have no further obligation to reimburse
the Executive for the cost of the premiums on such policy, but the Executive
may, at his sole cost and expense, continue such policy in effect upon the terms
and conditions thereof. Notwithstanding the foregoing provisions of this
subsection 4(f), the Company's obligation to reimburse the Executive for the
term life insurance contemplated by this subsection shall immediately cease upon
termination by the Company of the Executive's employment with cause (as defined
in the Employment Agreement).

      Section 5. Death. If the Executive dies while he is employed by the
Company or while he is receiving payments from the Company pursuant to Section 6
of the Employment Agreement, then no SERP Benefit shall be paid to the
Executive. Rather, the Executive shall be entitled to receive only (a) the
benefits or amounts under the plans, programs, agreements or insurance specified
in Section 3 hereof in accordance with the provisions of such plans, programs,
agreements and insurance, (b) the proceeds from the term life insurance policy
specified in Section 4(f) hereof, and (c) and any other amounts payable on
account of the Executive's death by virtue of his employment by the Company. If
the Executive dies while receiving his SERP Benefit, then the SERP Benefit shall
immediately cease upon the Executive's death and no survivor benefits thereunder
shall be payable.

<PAGE>
      Notwithstanding any other provision of this Supplement, the Executive may,
at any time after his termination of employment with the Company and at his sole
cost and expense, elect any form of annuity available under the Policy,
including without limitation an annuity which provides survivor benefits. If the
Executive makes such an election and the election results in the utilization by
Equitable of any portion of the Policy Value to fund such an annuity having
survivor benefits, the Company shall adjust its calculation of the Total Offset
Amount as provided in the following two sentences. First, the Company shall
treat the amount of the Policy Value used by Equitable to fund the annuity
having survivor benefits as still being invested in the "guaranteed fund" under
the Policy and still earning interest at the rate applicable to the "guaranteed
fund." Second, the Company shall treat all premiums on, and all additional
payments into the Cash Surrender Value of, the Policy paid by the Company as
being invested by the Executive in the "guaranteed fund" under the Policy.

      Section 6. Disability. If the Executive's employment with the Company is
terminated due to his Disability (as defined in the Employment Agreement), then
the SERP Benefit shall be paid as a life annuity to the Executive in equal
semi-annual installments of one-half (-1/2) the annual SERP Benefit commencing
on the first day of the sixth month following the month in which the Executive's
employment is so terminated and continuing every six (6) months thereafter until
the Executive's death. Except as provided in the preceding sentence, the SERP
Benefit shall be calculated in the same manner specified in Sections 2 and 3
hereof (but with no reduction for early retirement in the event that the
Executive's employment with the Company is terminated prior to his Normal
Retirement Age due to his Disability) and shall be funded in accordance with
Section 4(b) hereof.

      Section 7. Early Retirement. If the Executive's employment with the
Company is terminated prior to his Normal Retirement Age for any reason other
than by the Company without cause (as defined in the Employment Agreement), by
the Company with cause (as defined in the Employment Agreement), by the
Executive for Good Reason after a Change in Control (as defined in the
Employment Agreement) or due to his death or Disability (i.e., the Executive
voluntarily terminates his employment with the Company prior to reaching his
Normal Retirement Age), then the following adjustments to the calculation and
timing of the SERP Benefit and the payment and funding thereof shall apply:

      (a) The amount of the SERP Benefit shall be calculated by the Company
within ninety (90) days following the Applicable Calculation Date using
information reasonably available to it. The annuity amounts referenced in this
Section 7 shall be determined by the Company, which shall select, in its sole
discretion, at least three (3) insurance or financial services companies having
an insurer financial strength rating from A.M. Best of "A," "A+" or "A++" from
which to obtain quotes for such annuity amounts, and the lowest quote shall be
used for the calculations required by this Section 7.

      (b) The Company shall calculate (i) the SERP Benefit (as provided in
Sections 2 and 3 hereof) as a life annuity for the Executive with annual
benefits payable to him in equal semi-annual installments commencing on the
first day of the sixth month following the month in which the Executive
voluntarily terminates his employment prior to reaching his Normal Retirement
Age (the "Early Retirement Date") and ending on his death, (ii) the lump sum
needed on the Early Retirement Date to purchase a life annuity for the Executive
to fund the amount of the SERP Benefit determined in accordance with subsection
(b)(i), but with the semi-annual installments on this annuity commencing on the
first day of the sixth month following the date on which the Executive would
attain his Normal Retirement Age (rather than the Early Retirement Date) and
ending on his death, and (iii) the annual benefit amount under a life annuity
for the Executive that can be purchased on the Early Retirement Date using the
amount of the lump sum determined in accordance with subsection (b)(ii), but
with the semi-annual installments on this annuity commencing on the first day of
the sixth month following the Early Retirement Date and ending on his death (the
annual benefit amount calculated pursuant to this subsection (b)(iii) shall be
referred to in this Supplement as the "Early Retirement Annuity Amount").

      The Early Retirement Annuity Amount shall be increased, if necessary, so
that the sum of (x) the Early Retirement Annuity Amount, (y) the Preliminary
Annuity Amount, and (z) the annualized benefit payable under the Mohasco Plan,
is equal to Four Hundred Thousand Dollars ($400,000).

      The Early Retirement Annuity Amount shall be the SERP Benefit for purposes
of this Supplement and the Agreements and shall be the amount that the Executive
shall receive under this Supplement and the Agreements as his SERP Benefit in
the event that he voluntarily terminates his employment with the Company prior
to reaching his Normal

<PAGE>
Retirement Age. The Company shall fund and pay the Early Retirement Annuity
Amount in the same manner required by Section 4(b) hereof.

Example:

      Attached as Exhibit A hereto are sample calculations of the SERP Benefit
(assuming the Executive's employment with the Company is terminated other than
by the Company with cause after the Executive reaches his Normal Retirement Age)
and the Early Retirement Annuity Amount.

      Section 8. Effect of Severance Pay on SERP Benefit; Calculation of
Severance Pay. If the Company terminates the Executive's employment without
cause (as defined in the Employment Agreement) and the Executive is receiving
payments from the Company pursuant to Section 6 of the Employment Agreement,
then the SERP Benefit shall be determined under the following provisions of this
Section 8. If the last monthly payment pursuant to Section 6 of the Employment
Agreement is made on a date that precedes the Executive's Normal Retirement Age,
then the SERP Benefit shall be calculated, funded and paid as provided in
Sections 2, 3 and 7 hereof (except that with respect to Section 7(b)(i), the
SERP Benefit shall be calculated as a life annuity for the Executive with annual
benefits payable to him in equal semi-annual installments commencing on the
first day of the sixth month following the Applicable Calculation Date and
ending on his death). If the last monthly payment pursuant to Section 6 of the
Employment Agreement is made on a date that follows the Executive's Normal
Retirement Age, then the SERP Benefit shall be calculated, funded and paid as
provided in Sections 1, 2, 3 and 4 hereof.

      Notwithstanding the foregoing provisions of this Section 8, under no
circumstances shall the Executive receive payments pursuant to Section 6 of the
Employment Agreement and his SERP Benefit simultaneously. Rather, the Company
and the Executive agree that, if the Executive receives payments from the
Company pursuant to Section 6 of the Employment Agreement, then any SERP Benefit
shall not begin until after such payments end. If the Executive dies while
receiving payments pursuant to Section 6 of the Employment Agreement, then no
SERP Benefit shall be paid. Rather, the provisions of Section 5 of this
Supplement shall apply.

      For purposes of the Agreements and this Supplement, the term "incentive
compensation" (including without limitation as used in Sections 6 and 8 of the
Employment Agreement) shall mean only any annual cash bonuses under the STIP
paid to the Executive and shall exclude, without limitation, all payments paid
to the Executive under any other incentive compensation plan, program,
arrangement or agreement (including without limitation the LTIP) and all income
recognized by the Executive on the exercise of stock options; and the Employment
Agreement is hereby amended accordingly.

      Section 9. Termination for Cause. If the Executive's employment is
terminated by the Company with cause (as defined in the Employment Agreement),
then the Executive shall not be entitled to any SERP Benefit or any
compensation, payments or benefits under the Agreements or this Supplement,
except (a) as provided in Section 6 of the Employment Agreement in the event of
a termination of the Executive's employment with cause, (b) for the Policy and
the term life insurance policy contemplated by Section 4(f) hereof, the premiums
on both of such policies the Executive shall be responsible for paying following
termination of his employment, and (c) as provided in the Company's applicable
employee benefit plans, programs and agreements which cover the Executive on his
last day of employment with the Company.

      Section 10. Life Insurance under the Employment Agreement. The Executive
understands and agrees that the Employment Agreement requires the Company to
provide the Executive with a term life insurance policy with a face amount of
$1,500,000 and that such requirement under the Employment Agreement is satisfied
in full by the Policy (as previously defined in this Supplement). The Executive
further understands and agrees that the only life insurance which the Company is
obligated to provide to him or on which the Company is obligated to pay or
reimburse any premiums, whether pursuant to the Agreements, this Supplement or
otherwise, are (a) the Policy, (b) the term life insurance specified in Section
4(f) hereof, and (c) any group term life insurance that is provided to all
employees of the Company; and the Employment Agreement is hereby amended
accordingly.

<PAGE>
      Section 11. Claims Procedure.

      (a) Filing a Claim. The Executive may file a written claim for a benefit
under the Agreements with the Committee or with an individual named by the
Committee to receive claims under this Supplement.

      (b) Notice of Denial of Claim. In the event of a denial or limitation of
any benefit or payment due to or requested by the Executive, the Executive shall
be given a written notification containing specific reasons for the denial or
limitation of his benefit. The written notification shall contain specific
reference to the pertinent provisions of the Supplement on which the denial or
limitation of his benefit is based. In addition, it shall contain a description
of any other material or information necessary for the Executive to perfect the
claim and an explanation of why such material or information is necessary. The
notification shall further provide appropriate information as to the steps to be
taken within ninety (90) days of such notification if the Executive wishes to
submit his claim for review. This written notification shall be given to the
Executive within ninety (90) days after receipt of his claim by the Committee
unless special circumstances require an extension of time for processing the
claim. If such an extension of time for processing is required, written notice
of the extension shall be furnished to the Executive prior to the termination of
such ninety (90) day period, and such notice shall indicate the special
circumstances which make the postponement appropriate and the date by which the
Committee expects to render its decision, which shall not be later than one
hundred fifty (150) days after receipt of the Executive's claim by the
Committee.

      (c) Manner and Content of Notification of Benefit Determinations. All
notices given by the Committee shall be given to the Executive, or to his
authorized representative, in a manner that satisfies the standards of 29 CFR
2520.104b-1(b) as appropriate with respect to the particular material required
to be furnished or made available to that individual. The Committee may provide
the Executive with either a written or an electronic notice of its
determination. Any electronic notification shall comply with the standards
imposed by 29 CFR 2520.104b-1(c)(1)(i), (iii) and (iv). In the case of an
adverse benefit determination, the notice shall set forth, in a manner
calculated to be understood by the Executive:

      (i)   The specific reasons for the adverse determination;

      (ii)  Reference to the specific provisions of this Supplement (including
            any internal rules, guidelines, protocols, criteria, etc.) on which
            the determination is based;

      (iii) A description of any additional material or information necessary
            for the Executive to complete the claim and an explanation of why
            such material or information is necessary; and

      (iv)  A description of the review procedures and the time limits
            applicable to such procedures.

      The term "adverse benefit determination" means a denial, reduction, or
      termination of, or a failure to provide or make payment (in whole or in
      part) for, any benefit payable under this Supplement.

      (d) Appeal of Adverse Benefit Determinations. If the Executive receives an
adverse benefit determination and desires a review of that determination, he, or
his authorized representative, must file on his behalf, a written request for a
review of the adverse benefit determination, not later than sixty (60) days
after receiving the determination. The written request for a review must be
filed with the Committee. Upon receiving the written request for review, the
Committee shall advise the Executive, or his authorized representative, in
writing that:

      (i)   The Executive, or his authorized representative, may submit written
            comments, documents, records, and any other information relating to
            the claim for benefits; and

      (ii)  The Executive shall be provided, upon request of the Executive or
            his authorized representative, reasonable access to, and copies of,
            all documents, records, and other information relevant to the
            Executive's benefit claim, without regard to whether those
            documents, records, and information were considered or relied upon
            in making the adverse benefit determination that is the subject of
            the appeal.

      (e) Benefit Determination on Review. All appeals by the Executive of an
adverse benefit determination shall receive a full and fair review by the
Committee.

<PAGE>
      (f) Notification of Benefit Determination on Review. The Committee shall
notify the Executive, in accordance with this subsection (f), of its benefit
determination on review within a reasonable period of time, but not later than
sixty (60) days after its receipt of the Executive's request for review of an
adverse benefit determination. If, however, special circumstances require an
extension of time for processing the review, the Executive shall be notified,
prior to the termination of the initial sixty (60) day period, of the special
circumstances requiring the extension and the date by which the Committee
expects to render its benefit determination on review, which shall not be later
than one hundred twenty (120) days after receipt of a request for review.

      (g) Manner and Content of Notification of Benefit Determination on Review.
The Committee shall provide the Executive with notification of its benefit
determination on review in a method described in subsection (c). In the case of
an adverse benefit determination on review, the notification must set forth, in
a manner calculated to be understood by the Executive:

      (i)   The specific reasons for the adverse determination on review;

      (ii)  Reference to the specific provisions of this Supplement (including
            any internal rules, guidelines, protocols, criteria, etc.) on which
            the benefit determination on review is based; and

      (iii) A statement that the Executive is entitled to receive, upon request
            and free of charge, reasonable access to, and copies of, all
            documents, records and other information relevant to the Executive's
            benefit claim, without regard to whether those records were
            considered or relied upon in making the adverse benefit
            determination on review, including any reports, and the identities
            of any experts whose advice was obtained.

      (h) Right of Review. In the event of a denial or limitation of his
benefit, the Executive or his duly authorized representative shall be authorized
to review pertinent documents and to submit to the Committee issues and comments
in writing. In addition, the Executive or his duly authorized representative may
make a written request for a review of his claim and its denial by the Committee
after the Committee considers the issues and comments submitted in writing by
the Executive; provided, however, that such written request must be received by
the Committee (or its delegate to receive such request) within sixty (60) days
after receipt by the Executive of written notification of the denial or
limitation of the claim. The sixty (60) day requirement may be waived by the
Committee in its discretion.

      (i) Decision on Review. A decision shall be made by the Committee within
sixty (60) days after the receipt of the request for review, provided that where
special circumstances require an extension of time for processing the decision,
it may be postponed on written notice to the Executive (prior the expiration of
the initial sixty (60) day period) for an additional sixty (60) days after the
receipt of such request for review. Any decision by the Committee shall be
furnished to the Executive in writing and shall set forth specific reasons for
the decision.

      (j) Court Action. The Executive shall have no right to seek judicial
review of a denial or limitation of benefits or any decision of the Committee or
to bring any action in any court to enforce a claim for benefits prior to filing
a claim for benefits and exhausting his rights for review under this Section 11.

      Section 12. Notice of Retirement. The Executive shall provide written
notice to the Chairman of the Compensation Committee and the Chairman of the
Audit Committee of the Company's Board of Directors at least one hundred eighty
(180) days prior to any voluntary termination by the Executive of his employment
with the Company other than a termination by the Executive for Good Reason (as
defined in the Employment Agreement) after a Change in Control (as defined in
the Employment Agreement). During such 180 day period, the Executive shall, upon
request of the Board of Directors of the Company, cooperate with and assist the
Board of Directors in the transition of the Executive's duties and
responsibilities to a chief executive officer selected to succeed the Executive.

      Section 13. Miscellaneous.

      (a) Conflict. If there is any conflict between a provision of either the
Employment Agreement or the SERP Agreement and this Supplement, the provisions
of this Supplement shall control. Accordingly, any supplemental

<PAGE>
retirement plan or benefit contemplated by the Employment Agreement (including
without limitation Section 4 thereof) shall be provided by and controlled by
this Supplement.

      (b) Binding Effect. This Supplement shall be binding upon and inure to the
benefit of the parties hereto and their respective heirs, executors,
representatives, successors and assigns.

      (c) Headings. The headings in this Supplement have been inserted solely
for ease of reference and shall not be considered in the interpretation or
construction of this Supplement.

      (d) Severability. In case any one or more of the provisions (or any
portion thereof) contained in this Supplement shall, for any reason, be held to
be invalid, illegal or unenforceable in any respect, such invalidity, illegality
or unenforceability shall not affect any other provision of this Supplement, but
this Supplement shall be construed as if such invalid, illegal or unenforceable
provision or provisions (or portion thereof) had never been contained herein.

      (e) Counterparts. This Supplement may be executed in any number of
counterparts, each of which shall be an original, but such counterparts shall
together constitute one and the same agreement.

      (f) Construction. This Supplement shall be deemed to have been drafted by
both parties hereto. This Supplement shall be construed in accordance with the
fair meaning of its provisions and its language shall not be strictly construed
against, nor shall ambiguities be resolved against, either party.

      (g) Review and Consultation. The Executive hereby acknowledges and agrees
that he (i) has read this Supplement in its entirety prior to executing it, (ii)
understands the provisions, effects and restrictions of this Supplement, (iii)
has consulted with such of his own attorneys, accountants and financial and
other advisors as he has deemed appropriate in connection with his execution of
this Supplement, and (iv) has executed this Supplement voluntarily. THE
EXECUTIVE HEREBY UNDERSTANDS, ACKNOWLEDGES AND AGREES THAT HE HAS NOT RECEIVED
ANY ADVICE, COUNSEL OR RECOMMENDATION WITH RESPECT TO THIS SUPPLEMENT FROM ANY
DIRECTOR OR EMPLOYEE OF, OR ANY ATTORNEY, ACCOUNTANT OR ADVISOR FOR, THE
COMPANY.

      (h) Entire Agreement; Amendment. This Supplement, the Agreements and the
employee benefit plans referenced herein or therein constitute the entire
agreement and understanding between the parties hereto relating to the subject
matter hereof. This Supplement may be amended or modified only by a writing
signed by both parties hereto.

      (i) Certain References. Whenever in this Supplement a singular word is
used, it also shall include the plural wherever required by the context and
vice-versa. All references to the masculine, feminine or neuter genders herein
shall include any other gender, as the context requires. Unless expressly
provided otherwise, all references in this Supplement to days shall mean
calendar, not business, days. Unless otherwise defined herein, capitalized terms
used in this Supplement shall have the same meanings as those terms have in the
Employment Agreement or the SERP Agreement.

      (j) Governing Law. This Supplement shall be governed by and construed in
accordance with the laws of the State of Indiana, without reference to any
choice of law provisions, principles or rules thereof (whether of the State of
Indiana or any other jurisdiction) that would cause the application of any laws
of any jurisdiction other than the State of Indiana.

      (l) Recitals. The recitals, premises and "Whereas" clauses set forth on
pages 1 and 2 hereof are expressly incorporated into and made a part of this
Supplement.

      (m) Notice. All notices, requests and other communications hereunder shall
be in writing (which shall include facsimile communication) and shall be deemed
to have been duly given if (i) delivered by hand and receipted for, (ii) sent by
certified United States Mail, return receipt requested, first class postage
pre-paid, (iii) delivered by receipted overnight delivery service, or (iv)
delivered by facsimile transmission if such fax is confirmed immediately
thereafter by also mailing a copy of such notice, request or other communication
by certified United States Mail, return receipt requested, first class postage
pre-paid, as follows:

<PAGE>
<TABLE>
<S>                                        <C>
   If to the Executive:                    If to the Company:

   Michael E. Thomas                       Chairman of the Compensation Committee and
   Chromcraft Revington, Inc.              Chairman of the Audit Committee
   1100 North Washington Street            (2 notices)
   Delphi, Indiana  46923                  1100 North Washington Street
   Fax:  (765) 564-6673                    Delphi, Indiana  46923
                                           Fax:  (765) 564-6673

   With a copy to (which shall not         With a copy to (which shall not constitute notice):
   constitute notice):
                                           Frank T. Kane, Vice President-Finance
                                           and Secretary
   Michael J. MacLean, Esq.                Chromcraft Revington, Inc.
   Baker & Daniels                         1100 North Washington Street
   300 North Meridian Street               Delphi, Indiana  46923
   Indianapolis, Indiana  46204            Fax:  (765) 564-6673
   Fax:  (317) 237-1000
</TABLE>

or such substituted address or person as either party has given to the other in
writing.

      All such notices, requests and other communications shall be effective (w)
if delivered by hand, when delivered, (x) if mailed in the manner provided
herein, two (2) business days after deposit with the United States Postal
Service, (y) if delivered by overnight express delivery service, on the next
business day after deposit with such service, and (z) if by facsimile
transmission, on the date indicated on the fax confirmation page of the sender
if such fax also is confirmed by mail in the manner provided herein.

                                      * * *

             IN WITNESS WHEREOF, the parties hereto have made, entered into,
executed and delivered this Supplement A as of the day and year first above
written.

                                         /s/ Michael E. Thomas
                                         ----------------------------
                                         Michael E. Thomas

                                         CHROMCRAFT REVINGTON, INC.

                                         By:   /s/ Frank T. Kane
                                               ----------------------
                                               Frank T. Kane
                                               Vice President-Finance

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