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Indiana
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0-20184
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35-1537210
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(State
or Other Jurisdiction of
Incorporation)
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(Commission
File Number)
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(IRS
Employer Identification
No.)
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3308
North Mitthoeffer Road, Indianapolis, Indiana
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46235
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(Address
of Principal Executive Offices)
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(Zip
Code)
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¨
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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¨
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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¨
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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¨
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Term
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The
term of the Amended and Restated Employment Agreement has remained the
same and will expire on October 30, 2009. The term continues to be subject
to automatic renewal for additional 1-year periods unless the Company or
the executive gives notice of non-renewal, but the notice period has been
increased to 180 days from 90 days.
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Base
Salary and Benefits
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Mr.
Cohen’s base salary will be $318,000. He will continue to be eligible to
participate in the annual and long-term incentive bonus compensation
programs and employee benefit plans available to other
executives.
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Rights
Upon Non-Renewal of Employment Agreement, Coupled with Termination (not
due to “cause”)
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Under
the prior agreement, the executive was not entitled to any income
protection in this event. Under the Amended and Restated Employment
Agreement, the executive will be entitled to the following severance
benefits: (i) base salary for one year; (ii) health insurance for one
year; and (iii) the current year bonus based on days of service during the
year and actual performance for the
year.
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Rights
Upon Termination by the Company for “Cause” or by the executive without
“Good Reason”
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The
executive’s monetary rights and benefits in this event do not change.
However, the Amended and Restated Employment Agreement made the following
changes or clarifications: (i) the executive will have 35 days after
notice to attempt to cure any cause, instead of 15 days; (ii) whether
cause has occurred will be determined by a majority of the Board of
Directors, instead of by the Company; (iii) embezzlement and theft are
confirmed as constituting conduct that causes demonstrable harm to the
Company, and are thereby a basis for cause; and (iv) any failure to
perform material duties must continue for 30 days (instead of an undefined
period) in order to support a finding of cause.
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Rights
Upon Termination by the Company without “Cause” or by the executive with
“Good Reason” (not during the 30 days before or 2 years after a change in
control)
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A
“good reason” for an executive to terminate employment continues to
include (i) a reduction in base salary or bonus opportunities that does
not affect all executives; (ii) a transfer out of the geographic area; and
(iii) a substantial reduction in authority, duties or responsibilities, or
the imposition of duties and responsibilities inconsistent with the
executive’s position, if these developments occur during the 30 days
before or 2 years after a change in control. The Amended and
Restated Employment Agreement adds the occurrence of a material breach by
the Company as another “good reason,” and also adds rights for the Company
to receive notice of an executive’s “good reason” to terminate and be
given an opportunity to cure the problem.
The
Amended and Restated Employment Agreement also increases the financial
rights and benefits of the executive in the event of a termination without
cause or a resignation for good reason. Specifically, the
executive continues to be entitled to receive an amount equal to the Base
Salary, plus one year of continued health coverage. However, the possible
bonus payment in this event has been enhanced to be the greater of (i)
prorated long-term and annual bonus based on actual employment, or (ii)
average annual bonus actually paid to the executive for the 3-year period
prior to the termination of employment.
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Rights
Upon Termination by the Company without “Cause” or by the executive with
“Good Reason” (during the 30 days before or 2 years after a change in
control)
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In
the event of a termination without cause or a resignation with good
reason relating to a change in control, the executive will
continue to receive the same rights and benefits previously disclosed,
including a payment equal to 2.5 times the sum of (i) Base Salary, plus
(ii) target annual bonus for the termination year, plus (iii) the value of
any other bonus the executive could have earned during the termination
year, and also including health coverage for 2 years.
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Definition
of Change in Control
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Under
the prior agreement, a change in control would not be deemed to have
occurred if one of the Founders of the Company (Alan Cohen, David Klapper
or Larry Sablosky) continued to be the CEO for a period of time or the
group of Founders continued to own a majority of the voting
power. This exception to the definition of a change in control
was eliminated.
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Parachute
Taxes
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In
the event the executive will be subject to the excise tax imposed by
Section 4999 of the Internal Revenue Code of 1986, as amended, the
executive will continue to be entitled to receive additional payments from
the Company.
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Non-Competition
Provisions
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The
executive continues to be bound to observe certain non-competition
covenants for 12 months following (i) termination without cause or
resignation for good reason prior to a change in control, or (ii)
resignation without good reason following a change in
control. The restrictive period following a termination without
cause or a resignation for good reason after a change in control has been
reduced from 30 months to 24 months. Also, the ability of the
Company to impose a 6-month restrictive period on any employee to whom the
Company pays salary and health coverage severance benefits during the
restricted period has been eliminated. In addition, the
restricted activity during any restrictive period has been redefined to
more accurately reflect the business of the Company and current law. The
executive has to be engaged in a “competitive capacity” in a competitive
business; a competitive business is any business that competes with the
Company’s athletic specialty and/or sporting goods retail industry
business.
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Section
409A
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The
Amended and Restated Employment Agreement includes revisions to insure
compliance with Section 409A of the Internal Revenue Code of 1986, as
amended.
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Exhibit Number
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Description of Exhibit
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Exhibit
10.1
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Amended
and Restated Employment Agreement of Gary D. Cohen, dated as of December
31, 2008
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The
Finish Line, Inc.
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Date: December
31, 2008
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By:
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/s/ Beau J. Swenson |
| Beau J. Swenson, Vice President and Controller | ||
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Exhibit Number
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Description of Exhibit
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Location
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Exhibit
10.1
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Amended
and Restated Employment Agreement of Gary D. Cohen, dated as of December
31, 2008
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Attached
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