Employment Agreement between Hastings Entertainment, Inc. and Phil McConnell (Vice-President of Product)
This agreement, effective August 1, 2008, is between Hastings Entertainment, Inc. and Phil McConnell. It outlines the terms of McConnell’s employment as Vice-President of Product, including his duties, compensation, and benefits. McConnell will receive a base salary of $159,650 per year, be eligible for bonuses and equity awards, and have access to company benefits. The agreement also sets conditions on outside activities and includes provisions for compliance with company policies. Special tax-related provisions apply if certain payments trigger excise taxes. The agreement is subject to company policies and may be modified as needed.
2.1 | Specific Duties. During the term of this Agreement, the Executive will serve as Vice-President of Product for the Company and perform the duties of such office as set forth in the Bylaws of the Company. The Executive agrees to use the Executives best efforts to perform all of the services required to fully and faithfully execute the offices and positions to which the Executive is appointed and elected and such other services as may be reasonably directed by the Chief Executive Officer of the Company in accordance with this Agreement. | ||
2.2 | Modifications. The precise duties to be performed by the Executive may be extended or curtailed in the discretion of the Chief Executive Officer of the Company. | ||
2.3 | Responsibility. The Board of Directors of the Company retains ultimate responsibility to determine the duties of the Executive. | ||
2.4 | Rules and Regulations. From time to time, the Company may issue policies and procedures applicable to all its employees including the Executive. These policies and procedures include, but are not limited to, the Companys Associate Handbook and Code of Conduct. The Executive agrees to comply with such policies and procedures, except to the extent such policies conflict |
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with a material term or condition contained within this Agreement. Such policies and procedures may be supplemented, modified, changed or adopted without notice in the sole discretion of the Company at any time. In the event of a conflict between such policies and procedures and this Agreement, this Agreement will control unless compliance with this Agreement will violate any law or regulation applicable to the Company or its affiliated entities. The Company will apply its existing and future policies and procedures in a lawful and evenhanded manner. |
4.1 | Base Salary. A base salary (the Base Salary), in an annual rate of not less than ONE HUNDRED FIFTY-NINE THOUSAND SIX HUNDRED AND FIFTY AND NO/100 ($159,650.00), will be paid to the Executive in installments consistent with the Companys customary payroll practices, during the term of this Agreement. | ||
4.2 | Bonus. In addition to the Base Salary, the Executive will participate in the Corporate Officer Incentive Plan (COIP). Executives incentive target expressed as a percentage of Base Salary for the COIP initially shall be Twenty percent (20%), proportionately reduced as to any pro-rated performance period during which Executive is employed. | ||
4.3 | Equity Compensation. In addition to the compensation set forth in Sections 4.1 and 4.2 of this Agreement, the Executive will be allowed to participate in grants of stock options, restricted stock or other equity related awards from the Companys stock compensation plans put into effect from time to time, subject to the terms and conditions of such plans. | ||
4.4 | Benefits. The Company agrees to extend to the Executive retirement benefits, deferred compensation, reimbursement of reasonable expenditures for dues, travel and entertainment and any other benefits the Company provides to other executives or officers from time to time on the same general terms as such benefits are provided to such individuals. The Company will also provide the Executive the opportunity to apply for coverage under the |
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Companys medical, life and disability plans, if any. If the Executive is accepted for coverage under such plans, the Company will provide such coverage on the same terms as is customarily provided by the Company to the plan participants as modified from time to time. |
4.4.1 | Vacation. The Executive will be entitled to take paid vacation (as approved) each calendar year during the term of this Agreement in accordance with Company policy, subject to proration for any portion of a calendar year under this Agreement. No additional compensation will be paid for failure to take vacation and no vacation may be carried forward from one calendar year to another. |
4.5 | Gross-Up Payment. In the event it is determined that any payment or distribution by the Company or the Companys subsidiaries or affiliates to or for the benefit of the Executive (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise, but determined without regard to any additional payments required under this Section 4.5) (Parachute Payments) subject to the excise tax imposed by Section 4999 of the Internal Revenue Code (the Code) or any interest or penalties related to such excise tax (collectively, the Excise Tax), and parachute payments exceed 110% of the Executives 280G parachute limit (determined in accordance with Internal Revenue Code Section 280G) the Executive will be entitled to receive an additional payment (a Gross-Up Payment) from the Company. The Gross-Up Payment will be equal to the amount such that after payment by the Executive of all taxes (including the Excise Tax, income taxes, interest and penalties imposed with respect to such taxes) on the Gross-Up Payment, the Executive will retain an amount of the Gross-Up Payment equal to the Excise Tax imposed on the Payment. If the Parachute Payments to Executive are less than 110% of the 280G parachute limit, then the amount of Parachute Payments will instead be reduced so that they are $1 less than the 280G parachute limit. The Gross-Up Payment shall be paid to Executive no later than the last day of the year after the year in which the Executive remits the underlying taxes, penalties, and interest. If and to the extent Executives compensation must be reduced to avoid Section 4999 excise taxes, the annual bonus amount shall be reduced first, and if any additional amounts must be reduced then the annual salary amount shall be reduced. |
4.5.1 | Determination. Subject to the provisions of Section 4.5.2 all determinations required to be made under this Section 4.5 (including whether and when a Gross-Up Payment is required, the amount of such Gross-Up Payment and the assumptions to be utilized) will be made by a nationally recognized certified public accounting firm designated by the Executive (the Accounting Firm). The Accounting Firm will provide detailed supporting calculations both to the Company and the Executive within fifteen (15) business days of the receipt of notice from the Executive that there has been a Payment of excise tax, interest and/or penalties on the Parachute, or such |
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earlier time as is reasonably requested by the Company. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting a Change of Control (as hereinafter defined), the Executive will be entitled to appoint another nationally recognized accounting firm to make the determinations required under this Section (which accounting firm will then be referred to as the Accounting Firm hereunder). All fees and expenses of the Accounting Firm will be paid by the Company. Any Gross-Up Payment required to be paid under this Section 4.5 will be paid by the Company to the Executive within five (5) days of the receipt of the Accounting Firms determination, but no later than the last day of the year after the year in which the Executive remits the underlying taxes, penalties, and interest. Any determination by the Accounting Firm will be binding on the Company and the Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the time of initial determination by the Accounting Firm, the Gross-Up Payment made by the Company may be less than actually required (an Underpayment) consistent with the calculations required to be made hereunder. In the event that the Company exhausts its remedies pursuant to Section 4.5.2 below and the Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm will determine the amount of the Underpayment that has occurred and any such Underpayment will be promptly paid by the Company to or for the benefit of the Executive. Any Underpayment will be reimbursed, to the extent possible, in the same calendar year in which it occurred, but in no event later than the end of the calendar year after the year in which the executive remits the underlying taxes. | |||
4.5.2. | Contest of Claims. The executive will notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of a Gross-Up Payment. Such notification will be given as soon as practicable but no later than ten (10) business days after the Executive is informed in writing of such claim and will apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. The Executive will not pay such claim prior to the expiration of the thirty (30) day period following the date on which the Executive notifies the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies the Executive in writing prior to the expiration of such thirty (30) day period that the Company desires to contest such claim, the Executive will: (a) provide to the Company any information reasonably requested by the Company relating to such claim; (b) take such action in connection with contesting such claim as the Company reasonably requests in writing including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company; (c) cooperate with the Company in good faith as necessary to effectively contest |
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such claim; and (d) permit the Company to participate in any proceedings relating to such claim. The Company will bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with the contest of the claim and agrees to indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties with respect thereto) imposed as a result of such protest (including payment of costs and expenses as provided hereunder). Without limitation on the foregoing provisions, the Company will control all proceedings related to such contested claim, may at its sole option pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may at its sole option either direct the Executive to pay the tax claimed and sue for a refund or contest the claim in any permissible manner. The Executive agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company reasonably determines. If the Company directs the Executive to pay a claim and sue for a refund, the Company will be required to advance the amount of such payment to the Executive on an interest-free basis and agrees to indemnify and hold the Executive harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties with respect thereto) imposed with respect to such advance or with respect to any imputed income with respect to such advance, provided that any extension of the statute of limitations relating to payment of taxes for the taxable year of the Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, the Companys control of the contested claim will be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and the Executive will be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority. | |||
4.5.3 | Refunds. If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 4.5.2 the Executive becomes entitled to receive any refund with respect to such claim the Executive will (subject to the Companys complying with the requirements of Section 4.5.2) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 4.5.2, a determination is made that the Executive will not be entitled to any refund with respect to such claim and the Company does not notify the Executive in writing of its intent to contest such denial of refund prior to the expiration of thirty (30) days after such determination then the advance will be forgiven and will not be required to be repaid and the amount of such advance will offset, to |
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the extent thereof, the amount of Gross-Up Payment required to be paid. |
4.6 | Compensation Review. The compensation of the Executive will be reviewed on a regular basis by the Board of Directors of the Company (or a Compensation Committee thereof) and shall be reviewed annually if the compensation of other executive officers of the Company is reviewed at such frequency. The compensation of the Executive prescribed in Section 4 of this Agreement (including benefits) may be increased at the discretion of the Board of Directors of the Company or the Compensation Committee. |
6.1 | Separation from Service by Company. The Company will have the following rights to cause a separation from service between Employee and Company: |
6.1.1 | Separation from Service without Cause. | ||
The Company may cause a separation from service and Executives employment shall terminate without Cause at any time by the service of written notice of separation from service and termination to the Executive specifying an effective date of such separation and termination not sooner than ten (10) days after the date of such notice (the Separation from Service Date). In the event the Executive is separated and terminated without Cause (other than a CC Separation from Service under Section 6.3 of this Agreement), the Executive will receive as compensation: (i) for a period of 18 months his Base Salary (as in effect on the Separation from Service Date) plus bonus payable under COIP (based upon the incentive target percentage in effect on the Separation from Service Date and assuming Company performance at 100% of target); and (ii) any vacation pay accrued through the Separation from Service Date. The payment of such |
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amounts shall be made during the remaining term of the Agreement in installments consistent with the Companys normal payroll practices (including proration of bonus and payment of bonus when normally paid by the Company) but, if on the Separation from Service Date, the Executive is a specified employee as defined in regulations under Section 409A of the Code, such payments, to the extent not exempt, will commence on the first payroll payment date which is more than six (6) months following the Separation from Service Date (except as otherwise required under 11.11 hereof) and the first payment shall include any amounts that would have otherwise been payable during the six month period. | |||
6.1.2 | Separation from Service for Cause. The Company may cause a separation from service, and Executives employment shall terminate, for Cause. For purposes of this Agreement, Cause means either of the following: |
6.2 | Separation from Service by Executive. The Executive may voluntarily cause a separation from service with the Company by the service of written |
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notice of such separation from service to the Company specifying an effective date of such separation from service thirty (30) days after the date of such notice, during which time the Executive may use remaining accrued vacation days, or at the Companys option, be paid for such days. In the event separation from service is undertaken by the Executive, neither the Company nor the Executive will have any further obligations hereunder, except for any obligations which expressly survive separation from service including, without limitation, any obligation of the Company to provide any further payments or benefits to the Executive after the effective date of such separation from service. | |||
6.3 | Separation from Service After Change in Control. If during the term of this Agreement there is a Change of Control and within twenty-four (24) months thereafter, notwithstanding any separation from service pursuant to Section 5, there is a CC Separation from Service (as hereafter defined), then the Executive will be entitled to a severance payment (in addition to any other rights and other amounts payable to the Executive or under Company plans in which Executive is a participant) payable in a lump sum in cash within 10 days following the CC Separation from Service in an amount equal to two times (2X) the sum of the following: (a) the Executives Base Salary for the last eighteen (18) calendar months ending immediately prior to the CC Separation from Service and bonus paid pursuant to Section 4.2 (based upon the incentive target percentage in effect on the Separation from Service Date and assuming Company performance at 100% of target); plus (b) any applicable Gross-Up Payment. If the foregoing amount is not paid within ten (10) days after the CC Separation from Service, the unpaid amount will bear interest at the per annum rate of 12%, but in no event higher than the highest rate allowed by applicable law. Notwithstanding the foregoing, if at the time of a CC Separation from Service, the Executive is a specified employee as defined in regulations under Section 409A of the Code, such payment, to the extent not exempt, will be made on the first day which is more than six months following the CC Separation from Service. In connection with any Change of Control, the Company shall obtain the assumption of this Agreement, without limitation or reduction, by any successor to the Company or any parent corporation of the Company. In addition, the vesting for stock options, SERP, and issued restricted stock shall be accelerated to the date of the CC Separation from Service. |
6.3.1 | Change of Control. For the purpose of this Agreement, a Change of Control means the occurrence of any of the following: |
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6.3.2 | Change of Control Separation from Service. The term CC Separation from Service means any of the following: (a) a separation from service is undertaken by the Company other than under Sections 6.1.2, 6.4 or 6.5; or (b) the Executive undertakes a separation from service as a result of a material adverse change in the Executives duties or title, a significant reduction in the Executives then current Base Salary that is not generally applicable to all or substantially all of the Companys executives or a significant reduction in the Executives then current benefits as provided in Section 4; (c) a relocation of more than One Thousand (1,000) miles from the Executives then current place of employment being required by the Board of Directors; (d) the approval by the shareholders of the Company of a complete liquidation or dissolution of the Company; or (e) a default by the Company under this Agreement. |
6.4 | Incapacity of Executive. If the Executive suffers from a medically diagnosed physical or mental condition, which in the reasonable business |
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judgment of the Companys Board of Directors, prevents the Executive (in whole or in part) from performing the duties specified herein for a period of four (4) consecutive months, the Company may cause a separation from service, in which event, the Company will pay Executive his Base Salary and Bonus (computed at up to 100% of plan based on actual performance, but in no event more than 100% of plan regardless of actual performance) in effect on the date of notice of separation from service through the lesser of (i) the death of Executive; or (ii) the remaining term of this Agreement, but in any event through the Expiration Date, reduced by any disability payments received by Executive from any third party. The payment of such amounts shall be made during the remaining term of the Agreement in installments consistent with the Companys normal payroll practices. It is the intent of the parties to hereby create a bona fide disability plan provision exempt from IRC 409A, but, if on the separation from service date, the Executive is a specified employee as defined in regulations under Section 409A of the Code, such payments, in and to the extent deemed covered by 409A, will commence on the first payroll payment date which is more than six months following the notice of separation from service date and the first payment shall include any amounts that would have otherwise been payable during the six (6) month period. Notwithstanding the foregoing, the amount payable hereunder will be reduced by any benefits payable under any disability plans provided by the Company under Section 4.4 of this Agreement. Nothing in this Section will be interpreted or applied so as to lessen the Executives rights under state or federal disability or medical leave laws. | |||
6.5 | Death of Executive. If the Executive dies during the term of this Agreement, it will be deemed that a separation from service occurred on the date of death and Executives employment will terminate without compensation to the Executives estate except: (a) the obligation to continue the Base Salary payments under Section 4.1 of this Agreement for twelve (12) months after the date of death of the Executive, and (b) the benefits described in Section 4.4 of this Agreement accrued through the date of death of the Executive, including a prorated portion of bonus paid pursuant to the provisions and goals of the COIP then in effect, based upon the incentive target percentage in effect and assuming performance at 100% of target. | ||
6.6 | Resignation Following Constructive Discharge. If at any time, except in connection with a separation from service otherwise pursuant to this Agreement, Executive is Constructively Discharged (as that term is defined in this Section 6.6) then Executive shall have the right, by written notice to Company within sixty (60) days of such Constructive Discharge, to undertake a separation from service hereunder, effective as of thirty (30) days after such notice; provided the Company has failed to cure the Constructive Discharge within the thirty-day period following the notice. Executive shall in such event be entitled to the compensation and benefits as if such separation from service occurred pursuant to Section 6.1.1. |
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6.7 | Effect of Separation from Service. A separation from service will terminate all obligations of the Executive to render services on behalf of the Company. The Executive will maintain the confidentiality of all information acquired by the Executive during the term of his Employment in accordance with Section 7 of this Agreement and the covenants set forth in Section 8 of this Agreement. Except as otherwise provided in this Section 6, no accrued bonus, severance pay or other form of compensation will be payable by the Company to the Executive by reason of the separation from service. In the event that payments are required to be made by the Company under this Section 6, the Executive will not be required to seek other employment as a means of mitigating the Companys obligations hereunder resulting from separation from service and the Companys obligations hereunder (including payment of severance benefits) will not be terminated, reduced, or modified as a result of the Executives earnings from other employment or self-employment. All keys, entry cards, credit cards, records, financial information, furniture, furnishings, equipment, supplies and other items relating to the Company will remain the property of the Company. The Executive will have the right to retain and remove all personal property and effects that are owned by the Executive and located in the offices of the Company, subject to inspection by the Company. All such personal items will be removed from such offices no later than ten (10) days after the effective date of separation from service, and the Company is hereby authorized to discard any items remaining and to reassign the Executives office space after such date. Prior to the effective date of termination, the Executive will cooperate with the Company to provide for the orderly separation from service of the Executives employment. |
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11.1 | Time. Time is of the essence of each provision of this agreement. | ||
11.2 | Notices. Any notice, payment, demand or communication required or permitted to be given by any provision of this Agreement will be in writing and will be deemed to have been given when received by personal delivery, by facsimile, by overnight courier, or by certified mail, postage and charges prepaid, directed to the following address or to such other or additional addresses as any party might designate by written notice to the other party: |
To the Company: | Hastings Entertainment, Inc. | |||
Attn: President | ||||
P. O. Box 35350 (79120) | ||||
3601 Plains Blvd. | ||||
Amarillo, TX 79102 | ||||
With a copy to: | Sprouse Shrader Smith, P.C. | |||
Attn: Jeffrey G. Shrader | ||||
P. O. Box 15008 (79105) | ||||
701 S. Taylor, Suite 500 | ||||
Amarillo, TX 79101 |
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To the Executive: | Phil McConnell | |||
Hastings Entertainment, Inc. | ||||
P. O. Box 35350 (79120) | ||||
3601 Plains Blvd. | ||||
Amarillo, TX 79102 |
11.3 | Assignment. Neither this Agreement nor any of the parties rights or obligations hereunder can be transferred or assigned without the prior written consent of the other parties to this Agreement. | ||
11.4 | Construction, Choice of Law & Choice of Forum. This Agreement is intended to be interpreted, construed and enforced in accordance with the laws of the state of Texas. Further, any claim or cause of action or judicial proceedings that arise under or relate to this Agreement must be brought in a court of the competent jurisdiction in and for Potter County, Texas which shall be the exclusive forum. | ||
11.5 | Severability. If any provision of this Agreement or the application thereof to any person or circumstances is determined, to any extent, to be invalid or unenforceable, the remainder of this Agreement, or the application of such provision to persons or circumstances other than those as to which the same is held invalid or unenforceable, will not be affected thereby, and each term and provision of this Agreement will be valid and enforceable to the fullest extent permitted by law. | ||
11.6 | Entire Agreement. Except as otherwise provided in this Agreement, this Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter herein contained, and no modification hereof will be effective unless made by a supplemental written agreement executed by all of the parties hereto. | ||
11.7 | Binding Effect. This Agreement will be binding on the parties and their respective successors, legal representatives and permitted assigns. In the event of a merger, consolidation, combination, dissolution or liquidation of the Company, the performance of this Agreement will be assumed by any entity which succeeds to or is transferred the business of the Company as a result thereof. | ||
11.8 | Attorneys Fees, Costs, and Other Enforcement. If any party institutes an action, proceeding or arbitration against any other party relating to the provisions of this Agreement or any default hereunder, each Party will be responsible for paying their own legal fees and expenses, unless an award of fees by the arbitrator or court provides otherwise, including any costs of appeal, except if Executive is required to bring action or pursue legal remedies to enforce payment following CC Separation from Service provisions, Executive shall be entitled to recover all reasonable and necessary attorneys fees incurred in such action, on a monthly basis, regardless of the outcome of such action. In addition, should the Company fail or refuse to |
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make payment of any amounts under the CC Separation from Service provisions, upon written request of the Executive, in addition to the payment of any other sums provided in this Agreement, interest at the prime rate published from time to time in the Wall Street Journal plus three (3) percentage points, compounded daily, on any amount remaining unpaid fifteen (15) days following receipt of such demand, until paid to Executive. If the timing of such reimbursement of fees and costs or payment of interest to Executive by Company would trigger tax liability under IRC Code 409A, the Company shall pay the Executives estimate of fees, costs, and interest by the deadline set out in the final IRC 409A regulations and Executive will be required to pay the amounts to Company if he loses, except under a CC Separation from Service situation, in which Executive shall be under no obligation to repay such amounts. | |||
11.9 | Supersession. This Agreement is the final, complete and exclusive expression of the agreement between the Company and the Executive and supersedes and replaces in all respects any prior oral or written employment agreements. On execution of this Agreement by the Company and the Executive, the relationship between the Company and the Executive after the effective date of this Agreement will be governed by the terms of this Agreement and not by any other agreements, oral or otherwise. | ||
11.10 | Non-Contravention. Executive represents and warrants to the Company that the execution and performance of this Agreement will not violate, constitute a default under, or otherwise give rights to any third party, pursuant to the terms of any Agreement to which Executive is a party. | ||
11.11 | Indemnity. EXECUTIVE AGREES TO INDEMNIFY AND HOLD HARMLESS THE COMPANY, ITS DIRECTORS, OFFICERS AND EMPLOYEES AND AGENTS (THE INDEMNIFIED PARTIES) AGAINST ANY LOSS, CLAIM, DAMAGE, LIABILITY OR EXPENSE, AS INCURRED, (LOSS) TO WHICH THE INDEMNIFIED PARTIES MAY BECOME SUBJECT OR INCUR, INSOFAR AS SUCH LOSS AS ARISES OUT OF OR IS BASED UPON ANY INACCURACY IN ANY REPRESENTATION OR WARRANTY GIVEN BY EMPLOYEE IN SECTION 11.10 OF THIS AGREEMENT AND TO REIMBURSE THE INDEMNIFIED PARTIES FOR ANY AND ALL EXPENSES (INCLUDING THE FEES AND DISBURSEMENTS OF COUNSEL CHOSEN BY THE INDEMNIFIED PARTIES) AS SUCH EXPENSES ARE REASONABLY INCURRED BY THE INDEMNIFIED PARTIES IN CONNECTION WITH INVESTIGATING, DEFENDING, SETTLING, COMPROMISING OR PAYING ANY SUCH LOSS. | ||
11.12 | Compliance with Section 409A of the Code. Payments to Executive that are covered by IRC 409A under this Agreement are intended to comply with Section 409A of the Internal Revenue Code and this Agreement shall be construed and interpreted in accordance with such intent. To the extent any benefit paid under this Agreement shall be subject to Section 409A of the |
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Code, such benefit shall be paid in a manner that will comply with Section 409A, including any guidance thereunder. Any provision of this Agreement that would cause the payment of any benefit to fail to satisfy Section 409A of the Code shall have no force and effect until amended to comply with Section 409A which amendment may be retroactive to the extent permitted by the Section 409A and any guidance thereunder. As used in this Agreement, a separation from service (and its derivatives, such as separation from service date) shall occur when the Executive ceases to be employed by the Company and all entities considered a single employer with the Company under Code Sections 414(b) and (c) as a result of the Executives death, retirement, or other termination of employment. Whether a separation from service occurs shall be based on all the relevant facts and circumstances and shall be determined in accordance with the final regulations under Code Section 409A. | |||
11.13 | Termination of Any Prior Employment Agreements. Any prior employment agreement or contract between Executive and Company is terminated as of the Effective Date. | ||
11.14 | Payments Due Upon Separation from Service Except for Disability or Death of Executive. Except where this Agreement provides for a later commencement date all payments due Executive upon separation from service other than for disability or death of Executive shall commence forty-five (45) days following separation from service, provided Executive has executed a general release in favor of the Company and all periods in which Executive may revoke such release have expired. The failure to provide such a general release shall result in a termination of the Companys obligations to make any such payments hereunder. Any payments due as a result of Executives death or disability shall be made as otherwise provided herein or as soon as reasonably practicable. |
HASTINGS ENTERTAINMENT, INC. | ||||
By: | /s/ John H. Marmaduke | |||
John H. Marmaduke | ||||
President (the Company) | ||||
By: | /s/ Phil McConnell | |||
Phil McConnell | ||||
(the Executive) | ||||
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