EXHIBIT 10.15
FORM OF EXECUTIVE EMPLOYMENT AGREEMENT
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THIS EXECUTIVE EMPLOYMENT AGREEMENT (this "Agreement") is made as of
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October ____, 2003, by and between Conn's, Inc, a Delaware corporation with its
principle offices at 3295 College Street, Beaumont, Texas 77701 ("Conn's"), and
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__________________________, an individual (the "Executive").
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WHEREAS, Executive is currently employed by Conn Appliances, Inc., a Texas
corporation ("Conn Texas");
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WHEREAS, Conn Texas intends to effect a reorganization whereby it will
become a wholly owned subsidiary of Conn's, and simultaneously with such
reorganization, Conn's intends to effect an initial public offering of its
common stock (the "IPO");
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WHEREAS, subject to consummation of the IPO, Conn's desires to employ
Executive as ________________________, and Executive desires to be so employed,
upon the terms and conditions set forth herein; and
WHEREAS, Conn's and Executive desire to have this Agreement supersede any
and all prior agreements, oral or written, relating to the employment of
Executive by Conn Texas or Conn's.
NOW, THEREFORE, in consideration of the foregoing and in consideration of
the mutual promises and agreements contained herein, the parties hereto agree as
follows:
A. Employment Period. The employment period shall be for the period beginning
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on the date on which Conn's consummates the IPO (the "Effective Date") and
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ending on January 31, 2006 (as may be renewed, the "Employment Period"),
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unless earlier terminated pursuant to Section D. In the event the IPO is
not consummated, this Agreement shall be null and void. This Agreement may
be extended for additional one year periods upon the mutual written consent
of Conn's and Executive.
B. Nature of Duties.
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1. Executive's duties and responsibilities shall be to serve Conn's as
its ___________________, or in such other capacity as Conn's Board of
Directors (the "Board") shall direct, in conformity with management
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policies, guidelines and directions issued by Conn's, and shall have
general charge and supervision of those functions and such other
responsibilities as the Board shall determine. The Board may cause
Executive to serve as an officer of any subsidiary of the Company.
Executive's employment shall be subject to all of Conn's corporate
policies and personnel manuals as modified by this Agreement.
Executive shall report to the __________________________.
2. Executive shall work exclusively for Conn's on a full-time basis in
such capacity and shall carry on his employment at such location as
shall be required by the CEO. During normal business hours, Executive
shall devote all of his time and attention to Conn's business. During
the Employment Period, it shall not be a violation of this Agreement
for Executive to (i) serve on corporate, civic or charitable boards or
committees to the extent permitted by Sections and G and Q, (ii)
deliver lectures or
fulfill speaking engagements and (iii) manage personal investments, so
long as such activities do not materially interfere with the
performance of Executive's responsibilities in accordance with this
Agreement. Executive shall perform his duties and responsibilities
diligently, faithfully and loyally in order to cause the proper,
efficient and successful operation of Conn's business.
C. Compensation and Benefits.
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1. Conn's shall pay to Executive as compensation for services rendered by
Executive during the term of this Agreement a base annualized salary
of $______ per year, (the "Salary"), subject to adjustment as set
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forth below, payable semi-monthly. The Compensation Committee shall
review the Salary no less frequently than annually, and may, in its
discretion, adjust the Salary upward or downward, but in no event
shall the Salary be less than $_______ per year.
2. With respect to each fiscal year during the Employment Period,
Executive shall be eligible to receive an annual cash bonus (the
"Incentive Compensation"), the amount of such bonus to be determined
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by the Compensation Committee based on Executive's attainment of
certain performance goals relating to Conn's annual business
plan/budget as established by the Compensation Committee. Such
performance goals shall be communicated to Executive in writing no
later than sixty (60) days from the beginning of each fiscal year
during the Employment Period. With respect to the Incentive
Compensation to be paid to the Executive for the period ending on
January 31, 2004, the performance goals shall be communicated to
Executive in writing no later than thirty (30) days after the
Effective Date. In the event such performance goals are met, the
Incentive Compensation shall be paid to Executive no later than
forty-five (45) days following the close of the fiscal year to which
such Incentive Compensation relates.
3. Executive shall be entitled to participate in 401(k), life insurance,
major medical, dental, disability and other employee benefit plans of
Conn's that may be in effect from time to time and which other senior
executives of Conn's are otherwise eligible, to the extent Executive
is eligible under the terms of such plans (collectively, the
"Benefits").
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4. Conn's may, from time to time, grant stock options exercisable for
shares of Conn's common stock, and such options shall be subject to
the terms and conditions determined by the Compensation Committee.
5. Executive shall be entitled to paid vacation each calendar year and to
such personal and sick leave with pay in accordance with the policy of
Conn's, as may be established from time to time by Conn's and applied
to all other employees of Conn's.
6. If Conn's maintains any liability insurance covering members of its
Board of Directors, Executive will be included within the covered
class of individuals under such policy.
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7. During the Employment Period, Conn's may provide an automobile and gas
card to Executive for business and personal use. Income shall be
imputed to Executive for the personal use of such automobile.
8. Conn's shall reimburse Executive for all customary and reasonable
expenses incurred by Executive in performance of his duties under this
Agreement; provided, however, that Executive must furnish to Conn's an
itemized account satisfactory to Conn's, in substantiation of such
expenditures and such expenditures shall otherwise be in accordance
with Conn's policies and procedures.
D. Termination.
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1. This Agreement shall terminate automatically upon Executive's death.
2. Conn's may terminate Executive other than for Cause (as hereinafter
defined) or if Executive becomes permanently disabled, at any time,
upon no fewer than five (5) days prior written notice to Executive.
For purposes of this Agreement, permanent disability (i) shall be
determined in accordance with the disability insurance that Conn's may
then have in effect, if any, or (ii) if no such insurance is in
effect, shall mean that Executive is subject to a medical
determination that he, because of a medically determinable disease,
injury, or other mental or physical disability, is unable to perform
substantially all of his regular duties, and that such disability is
determined or reasonably expected to last at least twelve (12) months,
based on then-available medical information.
3. Conn's may terminate Executive for Cause, at any time, without written
notice.
4. Executive may terminate his employment, at any time, upon no fewer
than thirty (30) days prior written notice to Conn's.
5. Any termination under this Section D shall be communicated to the
other party in writing and if the date of termination is other than
the date of receipt of such notice, such written notice shall specify
the date of termination (which shall not be more than ninety (90) days
after giving of such notice). The date of termination shall be the
date of receipt of the notice of termination or any later date
specified therein.
E. Effects of Termination.
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1. In the event of automatic termination by reason of Executive's death
or by Conn's by reason of Executive's permanent disability, Conn's
shall have no further obligations under this Agreement except for its
obligation to pay Executive's Base Salary and Incentive Compensation,
if any, earned and accrued but unpaid through the date of death or
permanent disability. Executive shall have the right to receive
payments under the death or disability benefits, if any, provided to
Executive pursuant to Section C.3. of this Agreement.
2. In the event (i) Conn's exercises its right of termination other than
for Cause or (ii) this Agreement is not renewed by Conn's when it
expires, Conn's shall be obligated to pay Executive's Base Salary and
Incentive Compensation, if any, earned and accrued but unpaid through
the date of termination. In addition, Conn's shall pay as severance
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pay one (1) year of Executive's current Base Salary. Such payments
shall be made in equal installments in such intervals as the Base
Salary was paid at the time of such termination or expiration.
3. In the event Conn's terminates Executive for Cause or Executive
terminates his employment, Conn's shall have no further obligations
under this Agreement except for its obligations to pay Executive's
Base Salary earned and accrued but unpaid through the date of
termination.
F. Certain Definitions. For purposes of this Agreement, the following terms
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shall have the following meanings:
1. "Affiliate" shall mean, with respect to a person, any other person
controlling, controlled by or under common control with the first
person.
2. "Cause" shall mean (i) behavior of Executive which is adverse to
Conn's interests, (ii) Executive's dishonesty, criminal charge or
conviction, grossly negligent misconduct, willful misconduct, acts of
bad faith, neglect of duty or (iii) material breach of this Agreement.
3. "Confidential Information" shall mean information: (i) disclosed to or
known by the Executive as a consequence of or through his employment
with Conn's, (ii) not generally known outside Conn's and (iii) which
relates to any aspect of Conn's or its business, research, or
development. "Confidential Information" includes, but is not limited
to Conn's trade secrets, proprietary information, business plans,
marketing plans, methodologies, computer code and programs, formulas,
processes, compilations of information, results of research,
proposals, reports, records, financial information, compensation and
benefit information, cost and pricing information, customer lists and
contact information, supplier lists and contact information, vendor
lists and contact information, and information provided to Conn's by a
third party under restrictions against disclosure or use by Conn's or
others; provided, however, that the term "Confidential Information"
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does not include information that (a) at the time it was received by
Executive was generally available to the public, (b) prior to its use
by Executive, becomes generally available to the public through no act
or failure of Executive, (c) is received by Executive from a person or
entity other than Conn's or an Affiliate of Conn's who is not under an
obligation of confidence with respect to such information or (d) was
generally known by Executive by virtue of his experience and know how
gained prior to employment with Conn's.
4. "Control," and correlative terms, shall mean the power, whether by
contract, equity ownership or otherwise, to direct the policies or
management of a person.
5. "Copyright Works" shall mean materials for which copyright protection
may be obtained including, but not limited to literary works
(including all written material), computer programs, artistic and
graphic works (including designs, graphs, drawings, blueprints, and
other works), recordings, models, photographs, slides, motion
pictures, and audio-visual works, regardless of the form or manner in
which documented or recorded.
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6. "Person" shall mean an individual, partnership, corporation, limited
liability company, trust or unincorporated organization, or a
government or agency or political subdivision thereof.
7. "Work Product" shall mean all methods, analyses, reports, plans,
computer files and all similar or related information which (i) relate
to Conn's or any of its Affiliates and (ii) are conceived, developed
or made by Executive in the course of his employment by Conn's.
G. Non-Disclosure, Non-Competition and Non-Solicitation. Executive and Conn's
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acknowledge and agree that during and solely as a result of his employment by
Conn's, Conn's has provided and will continue to provide Confidential
Information and special training to Executive in order to allow Executive to
fulfill his obligations as an executive of a publicly-held company and under
this Agreement. In consideration of the special and unique opportunities
afforded to Executive by Conn's as a result of Executive's employment, as
outlined in the previous sentence, Executive hereby agrees as follows:
1. Executive agrees that Executive will not, except as Conn's may
otherwise consent or direct in writing, reveal or disclose, sell, use,
lecture upon, publish or otherwise disclose to any third party any
Confidential Information of Conn's or any of its Affiliates, or
authorize anyone else to do these things at any time either during or
subsequent to Executive's employment with Conn's. This Section G.1
shall continue in full force and effect after termination of
Executive's employment for any reason. Executive's obligations under
this Section G.1 with respect to any specific Confidential Information
shall cease only when that specific portion of the Confidential
Information becomes publicly known, other than as a result of
disclosure by Executive, in its entirety and without combining
portions of such information obtained separately. It is understood
that such Confidential Information of Conn's and any of its Affiliates
includes matters that Executive conceives or develops, as well as
matters Executive learns from other executives of Conn's and any of
its Affiliates.
2. During the Employment Period, Executive will not (other than for the
benefit of Conn's or any of its Affiliates pursuant to this Agreement)
compete with Conn's or any of its Affiliates by engaging in the
conception, design, development, production, marketing, or servicing
of any product or service that is substantially similar to the
products or services which Conn's or any of its Affiliates provides,
and that he will not work for, assist, loan money, extend credit or
become affiliated with as an individual, owner, partner, director,
officer, stockholder, employee, advisor, independent contractor, joint
venturer, consultant, agent, representative, salesman or any other
capacity, either directly or indirectly, any individual or business
which offers or performs services, or offers or provides products
substantially similar to the services and products provided by Conn's
or any of its Affiliates. The restrictions of this Section G.2 shall
not be violated by the ownership of no more than 1% of the outstanding
securities of any company whose equity securities are traded on a
national securities exchange or is quoted on the NASDAQ National
Market.
3. Executive agrees that he shall not, directly or indirectly, at any
time during the period of one (1) year after the termination of this
Agreement for any reason, including
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expiration of the Agreement, within the geographical area of 100 miles
of any existing or specifically contemplated Conn's retail or support
location at the time of termination, as an individual, owner, partner,
director, officer, stockholder, employee, advisor, independent
contractor, joint venturer, consultant, agent, representative,
salesman or any other capacity, work for, assist, loan money, extend
credit or become affiliated with, either directly or indirectly, any
individual or business which offers or performs services, or offers or
provides products substantially similar to the services and products
provided by Conn's or any of its Affiliates. The restrictions of this
Section G.3 shall not be violated by the ownership of no more than 1%
of the outstanding securities of any company whose equity securities
are traded on a national securities exchange or is quoted on the
NASDAQ National Market. It is understood that the geographical area
set forth in this covenant is divisible so that if this clause is
invalid or unenforceable in an included geographic area, that area is
severable and the clause remains in effect for the remaining included
geographic areas in which the clause is valid.
4. Executive agrees that for the duration of this Agreement, and for a
period of two (2) years after the termination of this Agreement or
expiration of this Agreement, Executive will not either directly or
indirectly, on his behalf or on behalf of others, solicit, attempt to
hire, or hire any person employed by Conn's and any of its Affiliates
to work for Executive or for another entity, firm, corporation, or
individual.
5. Executive acknowledges that Conn's has taken reasonable steps to
maintain the confidentiality of its Confidential Information and the
ownership of its Work Product and Copyright Works, which is extremely
valuable to Conn's and provides Conn's with a competitive advantage in
its market. Executive further acknowledges that Conn's would suffer
irreparable harm if Executive were to use or enable others to use such
knowledge, information, and business acumen in competition with
Conn's. Executive acknowledges the necessity of the restrictive
covenants set forth herein to: protect Conn's legitimate interests in
Conn's Confidential Information; protect Conn's customer relations and
the goodwill with customers and suppliers that Conn's has established
at its substantial investment; and protect Conn's as a result of
providing Executive with specialized knowledge, training, and insight
regarding Conn's operations as a publicly-held company. Executive
further agrees and acknowledges that these restrictive covenants are
reasonably limited as to time, geographic area, and scope of
activities to be restricted and that such promises do not impose a
greater restraint on Executive than is necessary to protect the
goodwill, Confidential Information and other legitimate business
interests of Conn's. Executive agrees that any breach of this Section
G cannot be remedied solely by money damages, and that in addition to
any other remedies Conn's may have, Conn's is entitled to obtain
injunctive relief against Executive without the requirement of posting
bond or other security. Nothing herein, however, shall be construed as
limiting Conn's right to pursue any other available remedy at law or
in equity, including recovery of damages and termination of this
Agreement.
6. Executive acknowledges that all writings, records, and other documents
and things comprising, containing, describing, discussing, explaining,
or evidencing any Confidential Information, Work Product, and/or
Copyright Works of Conn's, any Affiliate of Conn's, or any third party
with which Conn's has a confidential
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relationship, is the property of Conn's or such Affiliate. All
property belonging to Conn's in Executive's custody or possession that
has been obtained or prepared in the course of Executive's employment
with Conn's shall be the exclusive property of Conn's, shall not be
copied and/or removed from the premises of Conn's, except in pursuit
of the business of Conn's, and shall be delivered to Conn's, along
with all copies or reproductions of same, upon notification of the
termination of Executive's employment or at any other time requested
by Conn's. Conn's shall have the right to retain, access, and inspect
all property of any kind in Executive's office, work area, and on the
premises of Conn's upon termination of Executive's employment and at
any time during Executive's employment, to ensure compliance with the
terms of this Agreement.
7. The terms of this Section G are continuing in nature and shall survive
the termination or expiration of this Agreement.
H. Notices. All notices and other communications under this Agreement shall be
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in writing and shall be delivered personally or by facsimile or electronic
delivery, given by hand delivery to the other party, sent by overnight courier
or sent by registered or certified mail, return receipt requested, postage
prepaid, to:
If to Executive:
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Fax No.:
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If to Company: Conn's, Inc.
3295 College Street
Beaumont, Texas 77701
Attn: C. William Frank
Fax No.: (409) 212-9521
with a copy to: Winstead Sechrest & Minick P.C.
1201 Elm Street, Suite 5400
Dallas, Texas 75214
Attn: Thomas W. Hughes
Fax No.: (214) 745-5163
I. Assignment. Conn's shall require any successors (whether direct or
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indirect, by purchase, merger, consolidation or otherwise) to a controlling
interest in the business, assets or equity of Conn's to assume and agree to
perform this Agreement in the same manner and to the same extent that Conn's
would be required to perform if no such succession had taken place. This
Agreement is a personal employment contract and the rights, obligations and
interests of Executive under this Agreement may not be sold, assigned,
transferred, pledged or hypothecated by Executive.
J. Binding Agreement. Executive understands that his obligations under this
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Agreement are binding upon Executive's heirs, successors, personal
representatives and legal representatives.
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K. Arbitration. Except for any controversy or claim relating to Section G of
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this Agreement, any controversy or claim arising out of or relating to this
Agreement or the breach of any provision of this Agreement, including the
arbitrability of any controversy or claim, shall be settled by arbitration
administered by the American Arbitration Association ("AAA") under its National
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Rules for the Resolution of Employment Disputes and the Optional Rules for
Emergency Measures of Protection of the AAA, and judgment upon the award
rendered by the arbitrator(s) may be entered in any court having jurisdiction
thereof. Any provisional remedy which would be available from a court of law,
shall be available from the arbitrator to the parties to this Agreement pending
arbitration. Arbitration of disputes is mandatory and in lieu of any and all
civil causes of action and lawsuits either party may have against the other
arising out of Executive's employment with Conn's. Civil discovery shall be
permitted for the production of documents and taking of depositions. The
arbitrator(s) shall be guided by the Texas Rules of Civil Procedure in allowing
discovery and all issues regarding compliance with discovery requests shall be
decided by the arbitrator(s). The Federal Arbitration Act shall govern this
Section K. This Agreement shall in all other respects be governed and
interpreted by the laws of the State of Texas, excluding any conflicts or choice
of law rule or principles that might otherwise refer construction or
interpretation of this Agreement to the substantive law of another jurisdiction.
The arbitration shall be conducted in Beaumont, Texas by one neutral arbitrator
chosen by AAA according to its National Rules for the Resolution of Employment
Disputes if the amount of the claim is one million dollars ($1,000,000.00) or
less and by three neutral arbitrators chosen by AAA in the same manner if the
amount of the claim is more than one million dollars ($1,000,000.00). Neither
party nor the arbitrator(s) may disclose the existence, content, or results of
any arbitration hereunder without the prior written consent of both parties
unless compelled to do so either by judicial process or in order to enforce an
arbitration award rendered pursuant to this Section K. All fees and expenses of
the arbitration shall be borne by the parties equally. However, each party shall
bear the expense of its own counsel, experts, witnesses, and preparation and
presentation of proofs. The prevailing party, according to the arbitrator(s),
shall be entitled to an award of its reasonable attorneys' fees.
L. Waiver. No waiver by either party to this Agreement of any right to enforce
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any term or condition of this Agreement, or of any breach of this Agreement,
shall be deemed a waiver of such right in the future or of any other right or
remedy available under this Agreement.
M. Severability. If any provision of this Agreement as applied to either party
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or to any circumstances shall be adjudged by a court of competent jurisdiction
or arbitrator to be void or unenforceable the same shall in now way affect any
other provision of this Agreement or the validity or enforceability of this
Agreement. If any court or arbitrator construes any of the provisions of Section
G of this Agreement, or any part thereof, to be unreasonable because of the
duration of such provision or the geographic or other scope thereof, such court
or arbitrator shall reduce the duration or restrict the geographic or other
scope of such provision or enforce such provision to the maximum extent possible
as so reduced or restricted.
N. Entire Agreement; Amendment. This Agreement, the Indemnification Agreement
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entered into by Conn's and Executive and any agreements evidencing any stock
options granted to Executive pursuant to Section C.4 of this Agreement shall
constitute the entire agreement between the parties with respect to Executive's
employment with Conn's during the Employment Period. This Agreement replaces and
supersedes any and all existing agreements entered into between Executive and
Conn's, whether oral or written, regarding the subject matter of this
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Agreement. This Agreement may not be amended or modified other than by a written
agreement executed by the parties to this Agreement or their respective
successors and legal representatives.
O. Understand Agreement. Executive represents and warrants that he has (i)
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read and understood each and every provision of this Agreement, (ii) been given
the opportunity to obtain advice from legal counsel of choice, if necessary and
desired, in order to interpret any and all provisions of this Agreement and
(iii) freely and voluntarily entered into this Agreement.
P. Governing Law. This Agreement shall be governed by and construed in
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accordance with the laws of the State of Texas and is performable in Beaumont,
Texas.
Q. Professional/Personal. Membership by Executive on corporate and civic
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boards should be accepted only after consideration of conflict of interest and
consultation with the CEO of Conn's. Conn's requires Executive to have a
comprehensive annual medical physical examination.
R. Counterparts. This Agreement may be executed in one or more counterparts,
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each of which shall be deemed to be an original, but all of which taken together
shall constitute one and the same instrument.
S. Titles; Pronouns and Plurals. The titles to the sections of this Agreement
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are inserted for convenience of reference only and should not be deemed a part
hereof or affect the construction or interpretation of any provision hereof.
Whenever the context may require, any pronoun used in this Agreement shall
include the corresponding masculine, feminine or neuter forms, and the singular
form of nouns, pronouns, and verbs shall include the plural and vice versa.
T. Survival. Sections E through P of this Agreement shall survive the
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termination of Executive's employment or expiration of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
EXECUTIVE CONN'S, INC.
_______________________________ By:_________________________________________
[Name of Executive] Thomas J. Frank, Sr.
Chairman of the Board and Chief Executive
Officer
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