Financial Arrangements

9 Months Ended

Sep. 30, 2011

Financial Arrangements

Financial Arrangements

Note N - Financial Arrangements

Steven G. Rogers, Chief Executive Officer, President and a director of the Company resigned from his positions with the Company effective November 30, 2011.  In connection with the resignation, the Company entered into a Transition Agreement, dated October 7, 2011 (the "Transition Agreement"), with Mr. Rogers.  Under the Transition Agreement, the Company shall pay Mr. Rogers a cash payment equal to $2.9 million (less applicable deductions), which includes Mr. Rogers' accrued but unpaid bonus for 2011.  The Company also agreed to fully accelerate the vesting of all of the equity awards made by the Company to Mr. Rogers, other than his performance-based awards under the Company's FOCUS Plan, and provide Mr. Rogers with continuing healthcare coverage for up to two years after his resignation.  As a condition of receiving the benefits provided by the Transition Agreement, Mr. Rogers will be subject to restrictive covenants with respect to confidentiality and his ability to compete with, or solicit employees of, the Company for a period of 24 months.  Mr. Rogers also agreed to provide the Company with a general release of claims and, if requested, to provide consultation services and otherwise assist and advise the Company for a period of 12 months after his resignation.

On September 15, 2011, William R. Flatt, Executive Vice President and Chief Operating Officer of the Company resigned from his positions with the Company effective October 15, 2011.  In connection with the resignation, the Company entered into a Severance Agreement, dated October 10, 2011 (the "Severance Agreement"), with Mr. Flatt.  Under the Severance Agreement, the Company shall pay Mr. Flatt a cash payment equal to $611,000 (less applicable deductions), which includes a pro rata amount for Mr. Flatt's accrued but unpaid bonus for 2011.  The Company also agreed to accelerate the vesting of a pro rata portion of the time-based equity awards made by the Company to Mr. Flatt.  As a condition of receiving the benefits provided by the Severance Agreement, Mr. Flatt provided the Company with a general release of claims.