EARLY RETIREMENT AGREEMENT
THIS EARLY RETIREMENT AGREEMENT ("Early Retirement
Agreement"), made and entered into this 17th day of May,
1999, by and between DIMON Incorporated (the "Company")
and Xxxxxx X. Xxxx, Xx. (the "Executive").
WHEREAS, the Company and the Executive entered into
that certain Employment Agreement on December 21, 1994,
effective November 1, 1994 (the "Agreement") and
subsequent amendment, entered into on August 29, 1995.
WHEREAS, the Executive has advised the Company of
his intention to retire as Chief Executive Officer and a
director of the Company with full benefits as soon as he
is eligible to do so, although he is prepared to continue
for a transition period if the Board of Directors of the
Company so requests.
WHEREAS, in view of the Executive's intention, the
Company and the Executive both believe that it is in the
Company's best interest to effect succession and
management transition as soon as reasonably practicable
before October 31, 1999.
WHEREAS, it is the desire of the Company and the
Executive to preserve for the Executive and the Company
the full benefits to which each is entitled under the
Agreement.
NOW, THEREFORE, for good and valuable consideration,
the Company and the Executive agree as follows:
1. Term. The Company and the Executive mutually
agree that, as of the date hereof, the Executive's
employment under the Agreement ends, the Executive
retires from his employment with the Company and the
Executive tenders his resignation as a member of the
Board of Directors of the Company. The Company and the
Executive mutually acknowledge and agree that, in view of
the Executive's desire to retire and the Company's desire
to effect succession and management transition as soon as
reasonably practicable prior to October 31, 1999, this
retirement by the Executive gives rise to the rights and
obligations under the Agreement pursuant to Section 3.4
of the Agreement, other than any notice requirement
provided for by Sections 3.4 or 3.5, which notice
requirement is hereby waived, and other than the
provisions of Section 13.3 as to the noncompetition
provision, which is hereby confirmed as continuing in
full force and effect following the Executive's
retirement as provided below.
2. Reimbursement of Expenses, Office and
Secretarial Assistance. The Company acknowledges the
eligibility under the Agreement of the Executive through
the Compensation Continuance Period for reimbursement of
his reasonable expenses incurred for the benefit of the
Company, an office, and secretarial assistance pursuant
to Article 5, although Executive hereby waives the right
to have an office provided.
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(86)
3. Special Supplemental Retirement Benefits.
Although eligible to receive Special Supplemental
Retirement Benefits ("SSRB") pursuant to Section 6.1,
the Executive acknowledges and agrees that because the
Executive's Basic Benefits payable under Pension
Equalization Plan ("PEP") exceed the SSRB benefits,
pursuant to the SSRB benefits calculation in Section 6.1
he will not receive any SSRB benefits.
4. Special Health Care Benefits. The Company
acknowledges the eligibility of the Executive, and his
spouse where applicable, for Special Health Care Benefits
pursuant to Section 6.2.
5. Other Employee Benefits. The Company
acknowledges the eligibility of the Executive for
participation in other employee benefits plans and
receipt of other employee benefits during the
Compensation Continuance Period pursuant to Article 10 as
amended below, including without limitation participation
in the Company's matching gift program and the use of a
Company car in accordance with the Company's policy
therefor for senior executives.
6. Compensation Continuance and Special Severance
Benefit. The Company and Executive acknowledge the
eligibility of the Executive for the Severance Benefit
following the expiration of the Compensation Continuance
Period pursuant to Section 12.3 equal to Executive's Base
Salary and bonus under the Cash Bonus Plan for the
Employment Year just completed. In lieu of the rights
under Section 12.3, the Company and Executive agree that
Compensation Continuance Period under Section 12.2 shall
continue through October 31, 2000, but that the
compensation payable during such period shall be the same
as payable pursuant to the Severance Benefit.
7. Post-Termination Obligations. The Executive
acknowledges his post-termination obligations to the
Company pursuant to Article 13, including obligations
under Section 13.3 as to the noncompetition provision,
which is hereby confirmed as continuing in full force and
effect following the Executive's retirement and is
extended until one year following the termination of the
Compensation Continuance Period, or October 31, 2001,
rather than one year from the date hereof.
8. Gross-Up Payment. The Company acknowledges the
eligibility of the Executive for a Gross-Up Payment
pursuant to Article 14.
9. Pension Equalization Plan Eligibility. The
Company and the Executive acknowledge and agree that the
Executive, pursuant to Article 30 and the provisions of
the PEP, will be entitled to participate in the PEP to
the fullest extent possible upon completion of the
Compensation Continuance Period, notwithstanding any
provision in the Agreement or the PEP to the contrary,
and that the Executive shall be fully vested in the PEP
as of the Termination Date, with all related benefits
that flow therefrom, including without limitation the
Executive's vesting in the Company's split-dollar life
insurance on the Executive's life.
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(87)
10. Pension Equalization Plan Computations. The
Company and Executive agree that for purposes of
calculating the Executive's Final Average Earnings
under the PEP, which are defined as one-fifth of
his annual earnings during the highest consecutive
five-year period within the immediately preceding
ten year period, the annual earnings received by
the Executive through October 31, 2000, may be
considered when determining the highest
consecutive five year period.
11. Stock Options. The Company acknowledges
that after the Termination Date the Executive will
be entitled to all of his stock options, both
vested and unvested in accordance with existing
Company policy as reflected in the letter dated
January 11, 1995 to the Executive from Xxxx X.
Xxxxxxxxx on behalf of the Company. The unvested
options will remain outstanding for the balance of
their life and will continue to vest according to
their normal vesting schedule as if the
Executive's employment had not terminated.
12. Announcements. Neither the Company nor
the Executive will take any action or make any
comments which impugn, disparage, criticize or
negatively characterize, on the one hand, the
Executive, and on the other hand, the Company, its
directors, officers, management, employees or
agents, except that nothing herein shall limit
either party's rights and obligations as may be
required by law. Any public or Company
announcement with respect to the Executive's
retirement shall be reviewed between the Company
and the Executive before being made and shall be
reasonably acceptable to both parties, with the
Executive acknowledging that the Company in all
cases will have to meet its legal and regulatory
obligations as to public disclosure.
13. The Company and the Executive agree that
to the extent the provisions herein conflict with
the terms of the Agreement, the provisions herein
shall supersede and amend those terms of the
Agreement, and to the extent the provisions herein
conflict with the terms of the PEP, the provisions
herein supersede and amend those terms of the PEP.
14. The Company and the Executive agree that
to the extent the provisions herein do not
conflict with the terms of the Agreement, the
terms of the Agreement not repealed or modified
above remain in effect, and to the extent the
provisions herein do not conflict with the terms
of the PEP, the terms of the PEP remain in effect.
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(88)
IN WITNESS WHEREOF, the parties have executed
this Early Retirement Agreement and amendment to
Employment Agreement on the day and year first
above written.
EXECUTIVE
____________________________
Xxxxxx X. Xxxx, Xx.
WITNESS
/s/ Xxxxxxxx X. Xxxxx
Xxxxxxxx X. Xxxxx
________________________
DIMON INCORPORATED
/s/ Xxxxxx X. Xxxxxx, Xx.
Xxxxxx X. Xxxxxx, Xx.
By: ______________________
Chairman
Its: ____________________
Attest:
/s/ Xxxx X. Xxxxxxxxx
Xxxx X. Xxxxxxxxx
_________________________
Secretary/Assistant Secretary
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(89)
