EXHIBIT 10(i)
AGREEMENT
AGREEMENT made December 7, 1978 between Xxxxxxx Home Products, Inc.,
a Massachusetts corporation with its principal place of business at 000
Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx ("Xxxxxxx") and Xxxxx X. Xxxxxxx
of 000 Xxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxxxxxx ("Employee").
In consideration of the mutual agreements hereinafter contained, the
parties agree as follows:
l. Normal Retirement.
(a) Subject to the provisions of paragraph 9 below, if Employee
retires on or after October 23, 1981 Xxxxxxx will pay him each month for
the duration of his life deferred compensation equal to 1/12 of (i) 50% of
the average annual compensation received by him in the 5 most highly
compensated years of his final 10 years of employment, as determined under
paragraph 5 below, less (ii) 50% of his annual Primary Social Security
Benefit, as hereinafter defined.
(b) The monthly benefit determined under subparagraph (a) above shall
be reduced by the value of the monthly retirement benefit, if any, which
Employee is entitled to receive from any other qualified or nonqualified
plan maintained by Xxxxxxx (excluding the portion, if any, of such benefit
based on Employee's contributions to such plan) commencing at such time as
Employee first becomes eligible to receive such benefit, provided, however,
that any such reduction attributable to the Xxxxxxx Home Products, Inc.
Pension Plan shall be in an amount such that Xxxxxxx and his spouse, if she
survives him, will each receive the same benefit under this Contract and
the Pension Plan in combination as he or she would have received under the
Contract alone before the Pension Plan was adopted.
For purposes hereof, the value of the monthly retirement benefit of
any amount which Employee is entitled to receive from a defined
contribution plan based on Xxxxxxx'x contributions thereto, e.g. a
profit-sharing plan, shall be determined as of the time of Employee's
termination by reference to the annuity table set forth in Exhibit A
attached. It is recognized by the parties that prior to Employee's
termination there may be changes of sufficient importance in one or more of
the assumptions upon which this table is based to make appropriate the use
of an alternative table. In such case, Xxxxxxx may substitute an
alternative table but only upon the written recommendation of an
independent nationally recognized firm of compensation consultants, as may
be selected by it, and after written notice to the Employee.
(c) In the event that any portion of an annual contribution made by
Xxxxxxx to its profit sharing plan on the Employee's behalf has been used
to purchase a life insurance policy or policies for the Employee's benefit,
then for the purposes of subparagraph 1(b) the value of the retirement
benefit which Employee is entitled to receive from such plan shall be
deemed to be the amount he would have been entitled to receive assuming
such contribution instead had been invested in the same manner and charged
with the same expenses as the remainder of such annual contribution.
(d) In determining the value of the retirement benefit which Employee
is entitled to receive from Xxxxxxx'x profit sharing retirement plan for
purposes of subparagraph 1(b), any shares of Xxxxxxx Common Stock Non-
Voting purchased at his option for his account using funds in his vested
interest in such plan shall be deemed to have a value equal to the average
of the mean of the closing "bid" and "asked" prices of the Company's Common
Stock (Non-Voting) as reported on the National Association of Securities
Dealers Automated Quotation System ("NASDAQ") on the 7 business days,
excluding any business day for which no quotation appears on NASDAQ,
immediately preceding the valuation date used to determine the value of the
amount which he is entitled to receive from the plan upon termination of
employment.
2. Early Retirement. Subject to the provisions of subparagraph 2(c)
and paragraph 9 below,
(a) if Employee's employment terminates before October 23, 1981 for
any reason other than a discharge for cause, Xxxxxxx will pay him each
month for the duration of his life the benefit which would be payable if
the provisions of paragraph l above were applied as of the date of such
termination, provided that the portion of the benefit determined under
paragraph l (a) shall be reduced by the following percentages based on
Employee's age at his termination date (to be adjusted on a daily pro-rata
basis if Employee retires on a day other than his birthday):
Age at Termination Percentage
------------------ ----------
62-64 0%
61 2%
60 4%
59 9%
58 14%
57 19%
56 24%
55 29%
(b) During the period from his termination date to age 65, or if
different by law such other age as then entitles Employee to receive his
actual, unreduced primary social security benefit, the Company shall pay
him an additional monthly amount equal to his Primary Social Security
Benefit.
(c) If Employee's employment terminates by reason of discharge for
cause, neither he nor his wife shall be entitled to receive payment of any
kind under this agreement; "cause" hereunder shall mean dishonesty,
misconduct, insubordination or any activity which would cause a forfeiture
of rights under paragraph 9 below if it occurred following termination of
employment.
3. Disability.
(a) In the event Employee becomes disabled after reaching age 55 but
while still employed by Xxxxxxx, he shall receive, commencing with the
month following the commencement of his disability, a monthly amount
determined under paragraph l that would have been payable to him if he had
remained employed until retirement at age 65 at the annual rate of
compensation in effect at the time of his disability, provided that the
amount payable hereunder shall be reduced by the monthly value of any
benefit paid to Employee under a sick leave policy or long-term disability
income plan maintained by Xxxxxxx for so long as such benefits remain
payable.
(b) If Employee applies for payment of a social security disability
benefit prior to age 65 and his application is denied, the Company shall
also pay Employee an additional amount equal to his Primary Social Security
Benefit for as long as Employee remains ineligible to receive such social
security disability benefit prior to age 65, or if different by law the
then age at which Employee then becomes entitled to receive his actual
primary social security benefit.
For purposes hereof, an Employee shall be deemed to be disabled when
he is rendered incapable of performing the work for which he was employed
by a medically determinable physical or mental condition which is likely to
result in death or to be of long-continued and indefinite duration.
4. Survivors Benefit.
(a) In the event that Employee dies after age 55 while still employed
by Xxxxxxx, Xxxxxxx will pay his surviving spouse, subject to clause (c)
below, a monthly amount equal to 50% of the monthly benefit that would have
been paid to Employee under paragraph 1 or subparagraph 2(a), whichever is
applicable, had he retired on the day immediately prior to the date of his
death.
(b) In the event that Employee's employment by Xxxxxxx terminates
after age fifty-five (55) and he subsequently dies while receiving payments
hereunder, Xxxxxxx will pay his surviving spouse, subject to subparagraph
(c) below, a monthly amount for the remainder of her life equal to 50% of
the monthly benefit he would have received had he continued living,
excluding any amounts being paid to Employee under subparagraphs 2(b) and
3(b). In the event Employee was disabled and had been receiving a benefit
under paragraph 3, the surviving spouse shall be entitled to receive fifty
percent (50%) of the benefit payable under paragraph 3 without reduction
thereunder for any benefits being paid to Employee under a sick leave
policy or a long-term disability income plan maintained by Xxxxxxx except
to the extent such benefits remain payable to such spouse following
Employee's death.
(c) No amounts shall be paid a surviving spouse under subparagraph
(a) or (b) above unless she shall have survived Employee for a period of 30
days and shall have been married to him throughout the l year period ending
on Employee's date of death. Further, if the age of the Employee at the
date of his death exceeds the age of his surviving spouse on such date by
more than 5 years, the benefits payable to such spouse hereunder shall be
actuarially reduced in a manner calculated to reflect the difference in her
actual life expectancy at the time of his retirement and her life
expectancy if she were 5 years younger than Employee.
(d) If the sum of $20,000 exceeds the total amount paid to the
surviving spouse at time of her death, such excess shall be paid to a
beneficiary to be designated by Employee, or in the absence of his
designation, by his surviving spouse, in writing to Xxxxxxx, provided that
in the event no beneficiary has been designated or the designated
beneficiary does not survive such spouse for a period of 30 days, such
excess shall be paid to the personal representative of the surviving spouse.
5. Annual Compensation. For purposes hereof, Employee will be deemed
to have been employed for the entire calendar month during which his
employment terminates and his annual compensation shall be measured on the
basis of twelve month periods ending with the last day of such month.
"Compensation" for purposes hereunder shall include total wage,
salary and commission payments received by Employee from the Company
including base pay, overtime and bonuses but not including Company
contributions under the Company's Employees' Profit-Sharing Plan or under
any group life insurance or other qualified or non-qualified employee
retirement or benefit plan or any payment designated by the Company as an
allowance for Employee's business expenses.
In the event Employee's compensation for the last twelve-month period
cannot be determined by the time the first payment becomes due hereunder,
e.g., due to a bonus payable on the results of the Company's operations for
a year in which Employee retires prior to the end of such year, then the
first payments due hereunder shall be based on the estimated amount that
Employee will be entitled to actually receive. The exact amount due
Employee shall be determined as soon as practicable, provided that
following such determination and corresponding adjustment in the monthly
payment to Employee the Company shall pay Employee an additional lump sum
to adjust for any underpayment to Employee and Employee shall refund to
Company any overpayment.
6. Primary Social Security Benefit. An Employee's Primary Social
Security Benefit shall be determined on the day prior to the date on which
Employee's employment with Xxxxxxx terminates and shall be equal to the
estimated old age retirement benefit Employee will be entitled to receive
under the federal Social Security Act at age 65 (or if different by law
such other age as may then entitle a person to receive his social security
retirement benefits based on his unreduced "primary insurance amount" under
the Social Security Act as then in effect) based on his earnings up to the
day preceding his termination date.
7. Payment. Amounts payable under the above paragraphs will be paid
on or about the end of the month to which the payment relates. Payment will
be made for the full month in which Employee's death occurs.
8. Confidential Information and Covenant Not to Compete.
(a) Employee agrees that following termination of employment he will
not disclose any trade secrets or any confidential information nor do
anything detrimental to Xxxxxxx or any of its affiliated companies.
(b) Employee will neither engage nor assist during his life, directly
or indirectly, in work for or with any business organization using any
direct selling sales method in the sale of merchandise nor in any activity
competitive, directly or indirectly, with Xxxxxxx or any of its affiliated
companies without Xxxxxxx'x written consent in advance nor will he do
anything to interfere, directly or indirectly with the business of Xxxxxxx
of any of its affiliated companies. "Direct Selling Sales Method" shall
mean the selling or offering to sell either through employee sales
personnel or through or by independent salespersons to consumer purchasers
or prospective consumer purchasers at their residences or at other places
not under the control of the seller. This includes, but is not limited to
party plan or home demonstration, clubs demonstration and door-to-door
selling.
(c) Employee's obligations under the foregoing subparagraphs of this
paragraph 8 shall continue notwithstanding the termination of his rights to
receive any payments hereunder.
9. Forfeiture of Payments. Xxxxxxx may discontinue payments hereunder
and have no further liability under this agreement in the event that
Employee fails to observe any of the terms of this agreement, provided,
however, that if his failure to observe is limited to the terms of
subparagraph 8(b) above and is his first failure, Xxxxxxx shall give him
written notice thereof and if, within 15 days of such notice, Employee
gives Xxxxxxx written notice of his discontinuance of the activity
complained of, payments hereunder shall be reinstituted.
10. Assignment. Neither Employee nor his wife shall have any right to
commute, encumber, or dispose of the right to receive payments hereunder,
which payments and the right thereto are expressly declared to be
nonassignable and nontransferable. All rights under the Contract are merely
unsecured contractual rights of Employee or Employee's spouse against
Stanhome. Employee and Employee's spouse are unsecured general creditors of
Stanhome. Stanhome intends to set aside certain assets in a trust for the
payment of benefits under this Contract. In the event of the insolvency or
bankruptcy of Stanhome, any assets set aside in such trust shall at all
times be subject to the claims of Stanhome's general creditors as if such
assets were general assets of Stanhome.
11. Binding Effect. This agreement shall be binding upon and inure to
the benefit of any successor of Xxxxxxx and any such successor shall be
deemed substituted for Xxxxxxx under the terms of this agreement. As used
in this agreement, the term "successor" shall include any person, firm,
corporation, or other business entity which at any time, whether by merger,
purchase, or otherwise, acquires all or substantially all of the assets or
business of Xxxxxxx.
12. Not an Employment Agreement. This agreement is not an employment
agreement and Xxxxxxx reserves the right to discharge Employee with or
without cause. The agreement in no way affects his rights under the Xxxxxxx
Home Products, Inc. Employees' Profit-Sharing Retirement Plan or under any
Xxxxxxx group or other insurance policy.
13. Notices. Any notice required or permitted to be given under this
agreement shall be sufficient if in writing, and if sent by registered
mail, or delivered, to his residence in the case of Employee, at 000 Xxxx
Xxxxxx, Xxxxxxxxxxx, XX or in the case of Xxxxxxx, to its principal office
at 000 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx, Attn: Secretary. Either
party may change the address to which notices are to be addressed by notice
in writing given to the other in accordance with the terms hereof.
14. Waiver of Breach. The waiver by the Xxxxxxx of a breach of any
provision of this agreement by Employee shall not operate or be construed
as a waiver of any subsequent breach by Employee.
15. Governing Law. This agreement shall be deemed made in the
Commonwealth of Massachusetts, and its form, execution, validity,
construction and performance shall be construed in accordance with the laws
of said Commonwealth.
16. Entire Agreement. This agreement supersedes an earlier agreement
dated March 4, 1977 between the parties in its entirety and constitutes the
entire agreement of the parties. It may not be changed orally but only by
an agreement in writing signed by Employee and for Xxxxxxx by its Chief
Executive Officer.
17. Severability. In the event that any of the terms or provisions of
this agreement or any portion of such terms or provisions shall be
determined to be invalid or inoperative, such determination shall not
affect the efficacy of the balance of the agreement and any such invalid or
inoperative term or provision shall be deemed severable.
IN WITNESS WHEREOF the parties have executed this agreement.
"XXXXXXX": XXXXXXX HOME PRODUCTS, INC.
BY: /s/ H. L. Tower
------------------------
Its President
Attest:
/s/ Xxxxxx X. Xxxxx
-----------------------
Secretary
"EMPLOYEE": /s/ Xxxxx X. Xxxxxxx
---------------------------
Xxxxx X. Xxxxxxx
EXHIBIT "A"
Life Annuity Value
Age Value of $1. payable annually
for life, with first payment
Male Female at age shown on left
---- ------ ------------------------------
49 55 11.7932
50 56 11.6405
51 57 11.4831
52 58 11.3209
53 59 11.1537
54 60 10.9814
55 61 10.8037
56 62 10.6203
57 63 10.4301
58 64 10.2325
59 65 10.0274
60 66 9.8156
61 67 9.5977
62 68 9.3737
63 69 9.1434
64 70 8.9066
65 71 8.6649
66 72 8.4198
67 73 8.1739
68 74 7.9286
69 75 7.6846
70 76 7.4421
