1
EXHIBIT 10.16
January 15, 2001
Mr. Donald E. Ellis, Jr.
607 Haddington Lane
Peachtree City, Georgia 30269
Re: Employment Offer
Dear Gene:
I am pleased to memorialize the terms of your full time employment with The
Profit Recovery Group USA, Inc. ("PRG") as Executive Vice President-Finance,
Chief Financial Officer and Treasurer of PRG and of The Profit Recovery Group
International, Inc. ("PRGX") conditioned upon your signing the attached Employee
Agreement. You will report to the Chief Executive Officer of PRGX. You will be
responsible for all Finance Department functions of PRG and PRGX, including
financial planning, budgeting, accounting and treasury functions and will serve
as key spokesperson and contact for shareholders, investors and banking agencies
for PRGX. We are very excited about your joining our organization and the
opportunities for our mutual success.
The following confirms our offer:
1. Base Salary. Base salary paid at the rate of $300,000.00 per annum,
paid $11,538.46 every two weeks and pro-rated for partial years. You
commenced employment with PRG on October 26, 2000.
2. Performance Bonus. While you remain employed by PRG you will be
eligible for annual bonuses, which will include annual payout
potentials of up to 70% of your base salary for achievement of your
performance goals. These goals will be role-specific performance
objectives to be mutually agreed upon by you and the Chief Executive
Officer of PRGX. The measurement periods will be calendar quarter or
calendar year or a combination of both. Your bonus will be no less than
$50,000.00 per annum. Your bonus will be pro-rated for partial years
based on the number of days you were employed by PRG during such year.
3. Car Allowance. You will receive a car allowance paid at the rate of
$25,000.00 per annum, paid $2,083.33 monthly during your employment and
pro-rated for partial periods.
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Mr. Donald E. Ellis, Jr.
January 15, 2001
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4. Options. The Board of Directors of PRGX has granted to you options to
purchase 250,000 shares of Common Stock in The Profit Recovery Group
International, Inc. with 100,000 shares vesting as of October 26, 2000
and the remaining 150,000 vesting ratably and monthly over 36 months.
This grant is made pursuant to the terms of an option agreement, the
form of which will be delivered to you under separate cover.
5. Employee Benefits. You will be eligible for participation in PRG's
Employee Benefits Plan, which currently offers medical, dental, life,
short term and long term disability insurance, flexible spending
accounts, 401(k) Savings Plan and Employee Stock Purchase Program. The
effective dates for your coverage and participation in these plans
will be communicated to you under separate cover. During the term of
your employment, PRG will also pay the premiums, or, at your option,
reimburse you for premiums paid, on a $650,000 term life policy
(policy #41113584, carrier: TransAmerica Occidental Life Insurance
Company) which PRG previously acquired for you. While employed by PRG,
PRG will reimburse you for the cost incurred in connection with an
annual comprehensive physical examination to the extent not covered by
insurance.
6. Reimbursement of Expenses. PRG will pay your reasonable travel and
business expenses (including air travel at first class rate), subject
to you submitting receipts in accordance with PRG's normal practices
and procedures. Additionally, PRG will reimburse you for the
reasonable costs of having your own counsel review this Agreement on
your behalf prior to your signing this Agreement.
7. Vacation. You will be entitled to three (3) weeks of paid vacation for
each full year of employment with PRG, subject to PRG's policies and
procedures as promulgated from time to time.
8. Termination.
(a) This Agreement may be terminated by PRG for "cause" upon
delivery to you of notice of termination. As used herein,
"cause" means (i) fraud or dishonesty committed by you in the
course of your employment with PRG or PRGX, gross negligence
or willful misconduct committed by you in the course of your
employment with PRG or PRGX which has or might reasonably be
expected to have a material adverse effect upon the business
or operations of PRGX and its subsidiaries taken as a whole,
conviction of a felony or other crime of moral turpitude in
the course of employment (e.g., fraud, theft, embezzlement
and the like), or (ii) engaging in activities prohibited by
Sections 3, 4, 5 or 6 of the attached Employee Agreement, or
any other material breach of this Agreement. A termination of
your employment for "cause" based upon the immediately
preceding sentence shall take effect thirty (30) days after
PRG gives you written notice of such termination unless you
shall, during such thirty (30) day period, remedy the events
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Mr. Donald E. Ellis, Jr.
January 15, 2001
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or circumstances constituting "cause" to the reasonable
satisfaction of the Chief Executive Officer of PRGX;
provided, however, that such termination shall take effect
immediately upon the giving of notice of termination with
"cause" if PRG shall have reasonably determined in good faith
that such events or circumstances are not remediable (which
determination shall be stated in such written notice). If the
Chief Executive Officer of PRGX or Stanley Cohen ("Cohen") or
Jonathan Golden ("Golden") becomes aware of any facts or
circumstances that would give PRG the right to terminate your
employment for cause pursuant to this Section 8(a), PRG shall
give you notice of the existence of such facts or
circumstances within thirty (30) days of such facts or
circumstances being known by the Chief Executive Officer of
PRGX or by Golden or Cohen; provided, however, that this
sentence shall apply to Golden and Cohen only for so long as
such person continuously remains a member of the Board of
Directors of PRGX.
(b) You may, without cause, terminate this Agreement by giving
PRG thirty (30) days' written notice in the manner specified
in Section 11 hereof and such termination will be effective
on the thirtieth (30th) day following the date of such notice
or such earlier date as PRG specifies. PRG may, without
cause, terminate this Agreement by giving to you thirty (30)
days' written notice in the manner specified in Section 11
hereof and such termination will be effective on the
thirtieth (30th) day following the date of such notice. At
PRG's option, you will cease performing your duties as an
employee on such earlier date as PRG may specify in its
notice of termination.
(c) In the event of your Disability, physical or mental, PRG will
have the right, subject to all applicable laws, including
without limitation, the Americans with Disabilities Act
("ADA"), to terminate your employment immediately. For
purposes of this Agreement, the term "Disability" shall mean
your inability or expected inability (or a combination of
both) to perform the services required of you hereunder due
to illness, accident or any other physical or mental
incapacity for an aggregate of ninety (90) days within any
period of one hundred eighty (180) consecutive days during
which this Agreement is in effect, as agreed by the parties
or as determined pursuant to the next sentence. If there is a
dispute between you (or your legal representative) and PRG as
to whether a Disability exists, then such issue shall be
decided by a medical doctor selected by PRG and a medical
doctor selected by you or your legal representative (or, in
the event that such doctors fail to agree, then in the
majority opinion of such doctors and a third medical doctor
chosen by such doctors). Each party shall pay all costs
associated with engaging the medical doctor selected by such
party and the parties shall each pay one-half (1/2) of the
costs associated with engaging any third medical doctor.
(d) This Agreement may be terminated by you for "Good Reason"
upon thirty (30) days prior written notice of termination
(the "Termination Notice") served personally in
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January 15, 2001
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accordance with Section 11 hereof, such "Good Reason" being
specified in the Termination Notice; provided that at the
time of such notice to PRG, there is no basis for termination
by PRG of your employment for cause and the facts and
circumstances constituting cause have not been known by the
Chief Executive Officer of PRGX or, if applicable, Cohen or
Golden, for thirty (30) days or more; and further provided
that at the time of such Termination Notice to PRG you have
delivered at least 30 days prior thereto a written notice to
PRG (the "Event Notice") stating a condition (a "Qualifying
Event") exists which with the passage of time will allow you
to terminate your employment for "Good Reason" and specifying
the factual basis for such Qualifying Event and such
Qualifying Event has not been cured by PRG prior to its
receipt of the Termination Notice. For purposes of this
Agreement, "Good Reason" means any one of the following
events: (i) the assignment to you of duties or positions or
titles inconsistent with or lower than any of the duties,
positions or titles provided in this Agreement; (ii) the
principal place where you are required to perform a
substantial portion of your employment duties hereunder is
outside of the metropolitan Atlanta, Georgia area; (iii) the
reduction of your Base Salary, potential Bonus or annual
automobile allowance below amounts set forth herein; provided
however you shall have no right to terminate pursuant to this
clause (iii) of Section 8(d) if PRGX's Board of Directors or
the Compensation Committee of the Board of PRGX (the
"Committee") has duly authorized and directed a general
compensation decrease for all executive employees of PRG and
PRGX and the reduction of the sum of your Base Salary,
potential Bonus and automobile allowance hereunder is reduced
on a pro rata basis in respect of all other such executives;
or (iv) a "Change in Control" (as defined below) shall have
occurred. If you believe that a Qualifying Event has
occurred, you must give PRG the Event Notice within thirty
(30) days following the occurrence of such Qualifying Event
or you will not be entitled to rely on such event as the
basis for terminating your employment for Good Reason. PRG
will have thirty (30) days after its receipt of the Event
Notice to notify you that it disagrees in good faith with
your assertion that there has been a Qualifying Event and to
provide you with a detailed written explanation as to why it
disagrees. If PRG does not notify you within thirty (30) days
of its receipt of the Event Notice that it disagrees with
your assertion that there has been a Qualifying Event, PRG
shall be deemed to have agreed with your assertion that there
has been a Qualifying Event. If PRG agrees or is deemed to
agree with your assertion, or any disagreement is finally
resolved finding that a Qualifying Event has occurred, you
must give the Termination Notice within thirty (30) days
following the earliest of such agreement, deemed agreement or
final resolution or you will not be entitled to rely on the
specific facts underlying such Qualifying Event as the basis
for terminating your employment for Good Reason. If PRG
disagrees with your assertion in a timely manner, you may
give the Termination Notice at any time prior to the
resolution of whether a Qualifying Event has occurred;
provided, however, that your employment will be considered
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January 15, 2001
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terminated without Good Reason pending the outcome of the
disagreement as to whether a Qualifying Event has occurred.
If you terminate your employment in accordance with this
Section 8(d) and PRG disagrees with your assertion that a
Qualifying Event has occurred, and if the outcome of such
disagreement is that a Qualifying Event has occurred, you
will be entitled to interest at the prime rate, as announced
by Bank of America, N.A. or any successor thereto, Atlanta,
Georgia, on any severance payments you subsequently receive
calculated from the date you would have received such
payments if PRG had not disagreed with your assertion that a
Qualifying Event had occurred to the date you actually
receive such severance payments. Notwithstanding the
foregoing, a termination shall not be treated as a
termination for "Good Reason" (A) if you have consented in
writing in your individual capacity (regardless of any action
taken by you in your capacity as an officer of PRG or PRGX or
in your capacity as a stockholder of PRGX on any matter
presented to PRGX stockholders for a vote) to the occurrence
of the Qualifying Event giving rise to the claim of
termination for Good Reason or (B) unless you have delivered
an Event Notice to PRG at least 30 days prior to providing
the Termination Notice and the Qualifying Event identified in
the Event Notice shall not have been cured by PRG prior to
its receipt of the Termination Notice.
For purposes of this Agreement, a "Change in Control" shall
have occurred if:
(A) John M. Cook no longer serves as Chief Executive
Officer of PRGX; or
(B) a majority of the directors of PRGX shall be persons
other than persons:
(xx) for whose election proxies shall have been
solicited by the board; or
(yy) who are then serving as directors appointed
by the board to fill vacancies on the board
caused by death or resignation, but not by
removal, or to fill newly-created
directorships;
or
(C) a majority of the outstanding voting power of PRGX
shall have been acquired or beneficially owned by
any person (other than PRGX or a subsidiary of PRGX)
or any two or more persons acting as a partnership,
limited partnership, syndicate or other group,
entity or association acting in concert for the
purpose of acquiring, holding or disposing of voting
stock of PRGX; or
(D) there shall have occurred:
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(ww) a merger or consolidation of PRGX with or
into another corporation, other than (1) a
merger or consolidation with a subsidiary
of PRGX or (2) a merger or consolidation in
which the holders of voting stock of PRGX
immediately prior to the merger as a class
hold immediately after the merger at least
a majority of all outstanding voting power
of the surviving or resulting corporation
or its parent; or
(xx) a statutory exchange of shares of one or
more classes or series of outstanding
voting stock of PRGX for cash, securities
or other property, other than an exchange
in which the holders of voting stock of
PRGX immediately prior to the exchange as a
class hold immediately after the exchange
at least a majority of all outstanding
voting power of the entity with which the
PRGX stock is being exchanged; or
(yy) the sale or other disposition of all or
substantially all of the assets of PRGX, in
one transaction or a series of
transactions, other than a sale or
disposition in which the holders of voting
stock of PRGX immediately prior to the sale
or disposition as a class hold immediately
after the exchange at least a majority of
all outstanding voting power of the entity
to which the assets of PRGX are being sold;
or
(zz) the liquidation or dissolution of PRGX.
(e) In the event this Agreement is terminated, all provisions in
this Agreement or the Employee Agreement relating to any
actions, including those of payment or compliance with
covenants, subsequent to termination shall survive such
termination.
(f) The provisions in this Agreement as they relate to the giving
of notice prior to termination of employment shall control
any contrary notice requirements (or lack thereof) set forth
in the Employee Agreement.
9. Severance Payments.
(a) If your employment with PRG is terminated for cause or if you
voluntarily resign other than (i) for Good Reason or (ii) due
to Retirement (as defined below), you will receive your base
salary prorated through the date of termination, payable in
accordance with PRG's normal payroll procedure, and you will
not receive any
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bonus or any other amount in respect of the year in which
termination occurs or in respect of any subsequent years.
(b) If your employment with PRG is terminated prior to October 26,
2003 either by PRG or any successor to PRG without cause or by
you for Good Reason, you will receive:
(i) your base salary and performance bonus for the year
in which such termination occurs prorated through the
date of such termination, plus
(ii) a severance payment, subject to adjustment as set
forth below, equal to twenty-four (24) months of base
salary and car allowance, plus
(iii) a bonus of One Hundred Thousand Dollars
($100,000.00), plus
(iv) an amount (the "Excise Tax Reimbursement") sufficient
to pay the federal excise tax, if any, imposed under
Section 4999 of the Internal Revenue Code of 1986, as
amended, or any successor statute thereto (the
"Code") with respect to any compensation to which you
are entitled (X) hereunder other than the Excise Tax
Reimbursement, (Y) under any other agreement between
you and PRG or PRGX or any successor to PRG or PRGX,
or (Z) under any benefit plan of PRG or PRGX or any
successor to PRG or PRGX in which you participate,
whether such compensation described in clauses (X)
through (Z) of this subsection (b)(iv) is payable in
cash or otherwise (including any amount attributable
under Sections 280G and 4999 of the Code or
regulations promulgated thereunder to acceleration of
options), in connection with any termination of your
employment to which this subsection 9(b) applies;
plus
(v) an amount to reimburse you in full for any additional
federal excise tax under Section 4999 of the Code and
federal and state income taxes and Medicare taxes
(calculated using a federal income tax rate of 39.6%,
a state income tax rate of 6% and the prevailing
marginal Medicare tax rate) imposed on the Excise Tax
Reimbursement and the amount payable under this
clause (v) of subsection 9(b).
Except as provided in this subsection 9(b), or in any other
agreement between you and PRG or PRGX or any successor to PRG
or PRGX, you will not receive any other amount from PRG or
PRGX or any successor to PRG or PRGX in respect of the year in
which termination occurs or in respect of subsequent years.
The prorated base salary will be paid in accordance with PRG's
or its successor's normal payroll procedure, the prorated
performance bonus will be paid in a lump sum within ninety
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January 15, 2001
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(90) days after the end of the year to which it relates, and
the remaining payments will be paid in a lump sum within ten
(10) days following termination.
(c) If your employment with PRG is terminated on or after October
26, 2003 by PRG without cause or by you for Good Reason or is
terminated at any time by your death or Retirement, you (or
your legal representative in the case of death) will receive
base salary and performance bonus for the year in which such
termination occurs prorated through the date of such
termination and you will not receive any other amount in
respect of the year in which termination occurs or in respect
of any subsequent years. The prorated base salary will be paid
in accordance with PRG's normal payroll procedure and the
prorated performance bonus will be paid in a lump sum within
ninety (90) days after the end of the year to which it
relates.
(d) If your employment with PRG is terminated for Disability, you
or your legal representative will receive (i) all unpaid base
salary and bonuses for the year in which such termination
occurs prorated through the date of termination with such
prorated base salary payable in accordance with PRG's normal
payroll procedure and the prorated bonus payable in a lump sum
within ninety (90) days after the end of the year to which it
relates, and (ii) base salary for a period of ninety (90) days
following termination of employment due to Disability at the
rates in effect upon the date of such termination payable in
accordance with PRG's normal payroll procedure, reduced (but
not below zero) by the sum of (x) all amounts paid by PRG to
you as base salary prior to termination of employment for the
times that you were unable to perform the services required of
you under this Agreement due to illness, accident or any other
physical or mental incapacity which resulted in your
Disability and (y) all amounts that you are eligible to
receive under any of PRG's standard short-term group
disability insurance coverage provided to you as a result of
such illness, accident or any other physical or mental
incapacity. To the extent that PRG has not reduced its
payments to you to reflect such amount that you are eligible
to receive under such short-term group disability coverage,
you will immediately remit to PRG such amount upon your
receipt thereof. You will not receive any other amount in
respect of the year in which termination occurs or in respect
of any subsequent years. In lieu of terminating your
employment for a Disability, PRG may elect to put you on
unpaid leave of absence for a period determined in PRG's sole
discretion, but in no event to exceed one year. If put on
unpaid leave of absence, you will be entitled to the same
compensation to which you are entitled if you are terminated
as set forth above in this subsection 9(d) and shall not be
entitled to any further compensation except that you will
continue to maintain your eligibility in all PRG benefit plans
(but only to the extent such continued eligibility is not
prohibited pursuant to the terms of any such plan) provided
that PRG will have no responsibility to pay any premiums or
other amounts on your behalf with respect to any such plans.
Notwithstanding anything contained herein to the
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January 15, 2001
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contrary, if PRG elects to place you on unpaid leave of
absence in lieu of terminating you as provided in this
Subsection 9(d), (i) PRG will be entitled to subsequently
terminate your employment with PRG on the expiration of such
leave of absence without any further monetary obligations to
you and (ii) PRG will have no obligation to reinstate you to
active status unless PRG determines in its sole discretion
that such reinstatement is in the best interests of both PRG
and you.
(e) If your employment is terminated for any reason, you will be
paid within sixty (60) days of termination for the value of
all unused vacation time which accrued during the calendar
year in which such termination occurs up to the date of
termination in accordance with the Company's policies.
(f) If you fail to observe or perform in any material respect any
of your continuing duties and obligations under this Agreement
or your duties and obligations under Sections 3, 4, 5, or 6 of
the attached Employee Agreement, you will forfeit any right to
severance or other termination payments of any amounts other
than base salary prorated through the date of termination and
upon PRG's demand for same, you shall repay PRG any severance
or other termination payments paid to you after the date of
termination of your employment with PRG (other than such base
salary).
(g) Notwithstanding anything contained herein to the contrary, as
conditions precedent to receiving any severance benefits under
this Agreement, you will be required to (i) return all
property of PRG including, without limitation, all
Confidential Information (as that term is define in your
Employee Agreement), and (ii) execute and deliver in a
mutually satisfactory form (A) a general release and covenant
not to sue in favor of PRG, and its officers, directors and
employees, and (B) an agreement (1) to assist PRG with any
claims or litigation with others involving matters within the
scope of your employment with PRG, whether or not such claims
or litigation is initiated by PRG or others, (2) to refrain
from assisting others who are asserting claims against PRG or
suing PRG, unless otherwise required by law, and (3) to
refrain from any disparagement of PRG, or its officers,
directors or employees, unless otherwise required by law.
10. Successors and Assigns. You may not assign this Agreement. This
Agreement may only be assigned by PRG to any affiliate of PRG;
provided, however, PRG shall remain liable for all obligations under
this Agreement. The provisions of this Agreement will be binding upon
your heirs and legal representatives.
11. Notices. All notices pursuant to this Agreement will be in writing and
either (i) delivered by hand, (ii) mailed by United States certified
mail, return receipt requested, postage prepaid, or (iii) sent by an
internationally recognized courier which maintains evidence of delivery
and
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January 15, 2001
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receipt. All notices or other communications will be directed to the
following addresses (or to such other addresses as either of us may
designate by notice to the other):
If to PRG: The Profit Recovery Group USA, Inc.
2300 Windy Ridge Parkway
Suite 100 North
Atlanta, Georgia 30339-8426
Attention: Chief Executive Officer
If to you: 607 Haddington Lane
Peachtree City, Georgia 30269
12. Withholdings. PRG will deduct or withhold from all amounts payable to
you pursuant to this Agreement such amount(s) as may be required
pursuant to applicable federal, state or local laws.
13. Acceleration of Prior Severance Payments. You acknowledge that, as an
inducement to accept this Agreement, you have received the balance of
$145,833.31 owing to you pursuant to the first sentence of Section
11(c) of that certain Employment Agreement dated July 20, 1999 between
PRG and you, as amended, in full satisfaction of PRG's and PRGX's
obligations under that sentence. Accelerated payment of such balance
amount is mutually agreed to be a signing bonus hereunder.
14. Post Employment Assistance. Notwithstanding anything to the contrary in
this Agreement, commencing after the termination of this Agreement for
any reason, in the event PRGX, PRG or any of their affiliates requests
your assistance or you are a named defendant in any claim, threat or
inquiry related to your employment with PRG or PRGX, then you will be
paid $180/hour for your services plus expenses. You will make
reasonable efforts to be available to PRG and PRGX to provide such
assistance.
15. Enforcement of Agreement. If you take any action to enforce any
provision of this Agreement following a Change in Control and you are
the prevailing party in such action, whether by lawsuit, settlement,
arbitration or otherwise, PRG and PRGX will pay all of your reasonable
attorneys' and other professionals' fees and expenses actually incurred
by you in connection with such enforcement action.
16. Arbitration. Except as set forth below, any claim, dispute or
controversy arising under or in connection with this Agreement or
otherwise in connection with your employment by PRG (including, without
limitation, any such claim, dispute or controversy arising under any
federal, state or local statute, regulation, or ordinance or any of
PRG's or PRGX's employee benefit plans, policies or programs) shall be
resolved solely and exclusively by binding arbitration. The arbitration
shall be held in the city of Atlanta, Georgia (or at such
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January 15, 2001
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other location as shall be mutually agreed upon). The arbitration shall
be heard by a panel of three arbitrators and shall be conducted by the
American Arbitration Association under its National Rules for the
Regulation of Employment Disputes in effect at the time of the
arbitration. Except as otherwise specifically set forth in this letter,
all fees and expenses of the arbitration (other than a party's
respective legal and professional fees and expenses, which shall be
paid by the party incurring same), including a transcript if either
requests, shall be borne equally by the parties. The arbitrator's
decision shall be final and binding on the parties and shall bar any
suit, action or proceeding instituted in any federal, state or local
court or administrative tribunal. Notwithstanding the preceding
sentence, the arbitrator's judgment may be entered in any court of
competent jurisdiction. These arbitration provisions shall survive the
termination of this Agreement. Notwithstanding anything contained
herein to the contrary, PRG and PRGX shall not be required to arbitrate
any disputes regarding the terms set forth in Sections 3 through 6 of
the attached Employee Agreement. PRG and PRGX shall in all cases be
permitted to seek all remedies available at law to it in connection
with the enforcement of such provisions, including the right to seek
injunctive relief in any court of competent jurisdiction. Prior to
initiating any arbitration, an aggrieved party shall notify the other
and the parties shall have ten (10) days to work in good faith to
resolve any disagreements. If the disagreement remains unresolved for
ten (10) or more days from the date the aggrieved party's notice is
received by the other party, the aggrieved party may thereafter pursue
arbitration in accordance with this Section 16.
/s/ DEE
--------------
Gene Ellis to
initial here
/s/ JMC
--------------
John Cook to
initial here
17. Entire Agreement. This Agreement, the Employee Agreement, the
Indemnification Agreement between PRGX and you dated October 26, 2000
("Indemnification Agreement") and such other documents as may be
referenced herein or therein (the "Referenced Documents"), constitute
our entire agreement with respect to the subject matter hereof and,
except as specifically provided herein or in the Employee Agreement,
the Indemnification Agreement or the Referenced Documents, supersedes
all of our prior discussions, understandings and agreements. Any such
prior agreements shall be null and void. To the extent that there is a
conflict between this letter and the Employee Agreement, the terms of
this letter shall control. You acknowledge and agree that you have
received all amounts to which you are entitled under any prior
employment or severance agreements between you and PRG and release PRG
from any claims you may have for any additional payments under such
prior agreements. This Agreement may not be changed orally, but only by
an agreement in writing signed by the party against whom enforcement of
any waiver, change, modification, extension or discharge is sought.
Time is of the essence of this Agreement and each and every Section and
subsection hereof.
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January 15, 2001
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Please confirm your acceptance of this offer by signing and returning both this
letter and the Employee Agreement to me at your earliest convenience.
Best wishes,
/s/ JOHN M. COOK
-------------------------------------
John M. Cook,
Chairman and Chief Executive Officer
Accepted and agreed:
/s/ DONALD E. ELLIS, JR.
- --------------------------------------
Donald E. Ellis, Jr.
Date: January 15, 2001
---------------------------------