EXHIBIT 10.5
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT (this "AGREEMENT") is made, entered
into and effective as of July 1, 2002 (the "EFFECTIVE DATE") by and among UNITED
STATIONERS INC., a Delaware corporation (hereinafter, together with its
successors, referred to as "HOLDING"), UNITED STATIONERS SUPPLY CO., an Illinois
corporation (hereinafter, together with its successors, referred to as the
"COMPANY", and, together with Holding, the "COMPANIES"), and ________________
(hereinafter referred to as the "EXECUTIVE").
WHEREAS, the Companies have a need for executive management services; and
WHEREAS, the Executive is qualified and willing to render such services to
the Companies;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained herein, the parties agree as follows:
SECTION 1. DEFINITIONS.
(a) As used in this Agreement, the following terms have the
respective meanings set forth below:
"ACCRUED BENEFITS" means (i) all salary earned or accrued
through the date the Executive's employment is terminated, (ii)
reimbursement for any and all monies advanced in connection with the
Executive's employment for reasonable and necessary expenses
incurred by the Executive through the date the Executive's
employment is terminated, (iii) all accrued and unpaid annual
incentive compensation awards for the year immediately prior to the
year in which the Executive's employment is terminated, and (iv) all
other payments and benefits to which the Executive is entitled at
the date of termination under the terms of any applicable
compensation arrangement or benefit plan or program of the Company,
[ including, without limitation, the Supplemental Pension provided
for in APPENDIX A hereto].* "Accrued Benefits" shall not include any
entitlement to severance pay or severance benefits under any Company
severance policy or plan generally applicable to the Company's
salaried employees.
"AFFILIATE" shall have the meaning given such term in Rule
12b-2 of the Exchange Act.
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* Bracketed text shown appears in the form of agreement signed by ▇▇. ▇▇▇▇▇.
"BOARD" shall mean, so long as Holding owns all of the
outstanding Voting Securities (as hereinafter defined in the
definition of Change of Control) of the Company, the board of
directors of Holding. In all other cases, Board means the board of
directors of the Company.
"CAUSE" shall mean (i) conviction of, or plea of NOLO
CONTENDERE to, a felony (excluding motor vehicle violations); (ii)
theft or embezzlement, or attempted theft or embezzlement, of money
or property or assets of the Company or any of its Affiliates; (iii)
illegal use of drugs; (iv) material breach of this Agreement; (v)
commission of any act or acts of moral turpitude; (vi) gross
negligence or willful misconduct in the performance of Executive's
duties; (vii) breach of any fiduciary duty owed to the Company,
including, without limitation, engaging in competitive acts while
employed by the Company; or (viii) the Executive's willful refusal
to perform the assigned duties for which the Executive is qualified
as directed by the Executive's Supervising Officer (as hereinafter
defined) or the Board; provided, that in the case of any event
constituting Cause within clauses (iv) through (viii) which is
curable by the Executive, the Executive has been given written
notice by the Companies of such event said to constitute Cause,
describing such event in reasonable detail, and has not cured such
action within thirty (30) days of such written notice as reasonably
determined by the Chief Executive Officer. For purposes of this
definition of Cause, action or inaction by the Executive shall not
be considered "willful" unless done or omitted by the Executive (A)
intentionally or not in good faith and (B) without reasonable belief
that the Executive's action or inaction was in the best interests of
the Companies, and shall not include failure to act by reason of
total or partial incapacity due to physical or mental illness.
"CHANGE OF CONTROL" shall mean (a) Any "Person" (having the
meaning ascribed to such term in Section 3(a)(9) of the Exchange Act
and used in Sections 13(d) and 14(d) thereof, including a "group"
within the meaning of Section 13(d)(3)) has or acquires "Beneficial
Ownership" (within the meaning of Rule 13d-3 under the Exchange Act)
of 30% or more of the combined voting power of Holding's then
outstanding voting securities entitled to vote generally in the
election of directors ("VOTING SECURITIES"); provided, however, that
in determining whether a Change of Control has occurred, Voting
Securities which are held or acquired by (i) Holding of any of its
subsidiaries or (ii) an employee benefit plan (or a trust forming a
part thereof) maintained by Holding or any of its subsidiaries shall
not constitute a Change of Control. Notwithstanding the foregoing, a
Change of Control shall not be deemed to occur solely because any
Person acquired Beneficial Ownership of more than the permitted
amount of Voting Securities as a result of the issuance of Voting
Securities by Holding in exchange for assets (including equity
interests) or funds with a fair value equal to the fair value of the
Voting Securities so issued; provided that if a Change of Control
would occur (but for the operation of this sentence) as a result of
the issuance of Voting Securities by Holding, and after such
issuance of Voting Securities by Holding, such Person becomes the
Beneficial Owner of any additional Voting Securities which increases
the percentage of the Voting
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Securities Beneficially Owned by such Person to more than 50% of the
Voting Securities of Holding, then a Change of Control shall occur;
(b) At any time during a period of two consecutive years, the
individuals who at the beginning of such period constituted the
Board (the "INCUMBENT BOARD") cease for any reason to constitute
more than 50% of the Board; provided, however, that if the election,
or nomination for election by Holding's stockholders, of any new
director was approved by a vote of more than 50% of the directors
then comprising the Incumbent Board, such new director shall, for
purposes of this subsection (b), be considered as though such person
were a member of the Incumbent Board; provided, further, however,
that no individual shall be considered a member of the Incumbent
Board if such individual initially assumed office as a result of (i)
either an actual "Election Consent" (as described in Rule 14a-11
promulgated under the Exchange Act) or other actual solicitation of
proxies or consents by or on behalf of a Person other than the
Incumbent Board (a "PROXY CONTEST"), or (ii) by reason of an
agreement intended to avoid or settle any actual or threatened
Election Contest or Proxy Contest; (c) Consummation of a merger,
consolidation or reorganization or approval by Holding's
stockholders of a liquidation or dissolution of Holding or the
occurrence of a liquidation or dissolution of Holding ("BUSINESS
COMBINATION"), unless, following such Business Combination: (1) the
Persons with Beneficial Ownership of Holding, immediately before
such Business Combination, have Beneficial Ownership of more than
50% of the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors
of the corporation (or in the election of a comparable governing
body of any other type of entity) resulting from such Business
Combination (including, without limitation, an entity which as a
result of such transaction owns Holding or all or substantially all
of Holding's assets either directly or through one or more
subsidiaries) (the "SURVIVING COMPANY") in substantially the same
proportions as their Beneficial Ownership of the Voting Securities
immediately before such Business Combination, (2) the individuals
who were members of the Incumbent Board immediately prior to the
execution of the initial agreement providing for such Business
Combination constitute more than 50% of the members of the board of
directors (or comparable governing body of a noncorporate entity) of
the Surviving Company; and (3) no Person (other than Holding, any of
its subsidiaries or any employee benefit plan (or any trust forming
a part thereof) maintained by Holding, the Surviving Company or any
Person who immediately prior to such Business Combination had
Beneficial Ownership of 30% or more of the then Voting Securities)
has Beneficial Ownership of 30% or more of the then combined voting
power of the Surviving Company's then outstanding voting securities;
provided, that notwithstanding this clause (3), a Change of Control
shall not be deemed to occur solely because any Person acquired
Beneficial Ownership of more than 30% of Voting Securities as a
result of the issuance of Voting Securities by Holding in exchange
for assets (including equity interests) or funds with a fair value
equal to the fair value of the Voting Securities so issued; or (d)
Approval by Holding's stockholders of an agreement for the
assignment, sale, conveyance, transfer, lease or other disposition
of all or substantially all of the assets of Holding to any Person
(other
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than a subsidiary of Holding or other entity, the Persons with
Beneficial Ownership of which are the same Persons with Beneficial
Ownership of Holding and such Beneficial Ownership is in
substantially the same proportions), or the occurrence of the same.
Notwithstanding the foregoing, a Change of Control shall not be
deemed to occur solely because any Person acquired Beneficial
Ownership of more than the permitted amount of Voting Securities as
a result of the acquisition of Voting Securities by the Company
which, by reducing the number of Voting Securities outstanding,
increases the proportional number of shares Beneficially Owned by
such Person; provided that if a Change of Control would occur (but
for the operation of this sentence) as a result of the acquisition
of Voting Securities by Holding, and after such acquisition of
Voting Securities by Holding, such Person becomes the Beneficial
Owner of any additional Voting Securities which increases the
percentage of the Voting Securities Beneficially Owned by such
Person, then a Change of Control shall occur.
"EXCHANGE ACT" shall mean the Securities Exchange Act of
1934, as amended.
"GOOD REASON" shall mean (i) any material breach by the
Companies of this Agreement, (ii) any material reduction, without
the Executive's written consent, in the Executive's title, duties,
responsibilities or authority; provided, however, that for purposes
of this clause (ii), neither (A) a change in the identity of the
Executive's Supervising Officer or the number or identity of the
Executive's direct reports, (B) a change in the Executive's title,
duties, responsibilities or authority as a result of a realignment
or restructuring of the Companies' executive organizational chart
nor (C) a change in the Executive's title, duties, responsibilities
or authority as a result of a realignment or restructuring of the
Companies following a Change of Control shall be deemed by itself to
materially reduce Executive's title, duties, responsibilities or
authority, as long as, in the case of either (A), (B) or (C),
Executive continues to report to the Chief Executive Officer of the
Companies, or (iii) without Executive's written consent: (A) a
reduction in the Executive's Base Salary or elimination of or
reduction in the level of executive benefits and/or perquisites
(other than across-the-board reductions applied in the same
percentage at the same time to all of the Companies' senior
executives at the same grade level), (B) the relocation of the
Executive's principal place of employment more than fifty (50) miles
from its location on the Effective Date of this Agreement, or (C)
the relocation of the Company's corporate headquarters office
outside of the Chicago, IL metropolitan area. For purposes of this
Agreement, a Change of Control, alone, does not constitute Good
Reason. Furthermore, notwithstanding the above, the occurrence of
any of the events described above will not constitute Good Reason
unless the Executive gives the Companies written notice within
thirty (30) days after the occurrence of any of such events that the
Executive believes that such event constitutes Good Reason, and the
Companies thereafter fail to cure any such event within thirty (30)
days after receipt of such notice.
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"PERSON" shall mean any natural person, firm, corporation,
limited liability company, trust, partnership, limited or limited
liability partnership, business association, joint venture or other
entity and, for purposes of the definition of Change of Control
herein, shall comprise any "person", within the meaning of Sections
13(d) and 14(d) of the Exchange Act, including a "group" as therein
defined.
"SUBSIDIARY" shall mean, with respect to any Person, any
other Person of which such first Person owns 20% or more of the
economic interest in such Person or owns or has the power to vote,
directly or indirectly, securities representing 20%or more of the
votes ordinarily entitled to be cast for the election of directors
or other governing Persons.
(b) The capitalized terms used in Section 5(j) have the
respective meanings assigned to them in such Section and the following
additional terms have the respective meanings assigned to them in the
Sections hereof set forth opposite them:
"Annual Bonus" Section 4(b)
"Base Salary" Section 4(b)
"Bonus Plan" Section 4(b)
"Confidential information or proprietary data" Section 6(a)(2)
"Customer" Section 6(d)(2)
"Employment Period" Section 2
"Supervising Officer" Section 3(a)
"Term" and "Termination Date" Section 2
SECTION 2. TERM AND EMPLOYMENT PERIOD. Subject to Section 19 hereof,
the term of this Agreement ("TERM") shall commence on the Effective Date of this
Agreement and shall continue until the effective date of termination of the
Executive's employment hereunder pursuant to Section 5 of this Agreement. The
period during which the Executive is employed by the Companies pursuant to this
Agreement is referred to herein as the "EMPLOYMENT PERIOD." The date on which
termination of the Executive's employment hereunder shall become effective is
referred to herein as the "TERMINATION DATE."
SECTION 3. DUTIES.
(a) During the Employment Period, the Executive (i) shall serve
as ___________________ of the Companies, (ii) shall report directly to the
Chief Executive Officer of the Companies (the "SUPERVISING OFFICER"), (iii)
shall, subject to and in accordance with the authority and direction of the
Board and/or the Supervising Officer have such authority and perform in a
diligent and competent manner such duties as may be assigned to the
Executive from time to time by the Board and/or the Supervising Officer and
(iv) shall devote the Executive's best efforts and such time, attention,
knowledge and skill to the operation of the business and affairs of the
Companies as shall be necessary to perform the Executive's duties. During
the Employment Period, the Executive's place of performance for the
Executive's duties and responsibilities shall be at the Companies'
corporate headquarters office, unless another principal place of
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performance is agreed in writing among the parties and except for required
travel by the Executive on the Companies' business or as may be reasonably
required by the Companies.
(b) Notwithstanding the foregoing, it is understood during the
Employment Period, subject to any conflict of interest policies of the
Companies, the Executive may (i) serve in any capacity with any civic,
charitable, educational or professional organization provided that such
service does not materially interfere with the Executive's duties and
responsibilities hereunder, (ii) make and manage personal investments of
the Executive's choice, and (iii) with the prior consent of the Companies'
Chief Executive Officer, which shall not be unreasonably withheld, serve on
the board of directors of one (1) for-profit business enterprise.
SECTION 4. COMPENSATION. During the Employment Period, the Executive
shall be compensated as follows:
(a) the Executive shall receive, at such intervals and in
accordance with such Company payroll policies as may be in effect from time
to time, an annual salary (pro rata for any partial year) equal to
$___________ ("BASE SALARY"). The Base Salary shall be reviewed by the
Board from time to time and may, in the Board's sole discretion, be
increased when deemed appropriate by the Board; if so increased, it shall
not thereafter be reduced (other than an across-the-board reduction applied
in the same percentage at the same time to all of the Companies' senior
executives at the same grade level);
(b) during the Employment Period, the Executive shall be
eligible to earn an annual incentive compensation award under the
Companies' management incentive or bonus plan, or a successor plan thereto,
as shall be in effect from time to time (the "BONUS PLAN"), subject to
achievement of performance goals determined in accordance with the terms of
the Bonus Plan (such annual incentive compensation award, the "ANNUAL
BONUS"), with such Annual Bonus to be payable in a cash lump sum at such
time as bonuses are ordinarily paid to the Companies' senior executives at
the same grade level;
(c) the Executive shall be reimbursed, at such intervals and in
accordance with such Company policies as may be in effect from time to
time, for any and all reasonable and necessary business expenses incurred
by the Executive for the benefit of the Companies, subject to documentation
in accordance with the Companies' policies;
(d) the Executive shall be entitled to participate in all
incentive, savings and retirement plans, stock option plans, practices,
policies and programs applicable generally to other senior executives of
the Companies at the same grade level and as determined by the Board from
time to time;
(e) the Executive and/or the Executive's family, as the case may
be, shall be eligible for participation in and shall receive all benefits
under welfare benefit plans, practices, policies and programs provided by
the Company to senior executives of the Companies at the same grade level
(including, without limitation, medical, prescription,
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dental, disability, salary continuance, employee life, group life, and
accidental death and travel accident insurance plans and programs) to the
extent applicable generally to other executives of the Companies at the
same grade level;
(f) the Executive shall be provided with an automobile allowance
or a Company-leased automobile, in either case in accordance with the
Companies' then applicable Executive Automobile Policy; the Executive shall
be entitled to not less than twenty (20) paid vacation days per calendar
year (pro rata for any partial year);
(g) the Executive shall be entitled to participate in the
Company's other executive fringe benefits and perquisites generally
applicable to the Companies' senior executives at the same grade level in
accordance with the terms and conditions of such arrangements as are in
effect from time to time[; and]
[(h) appended hereto as Appendix A and made a part of this
Agreement is a description of certain modifications and clarifications to
Section 4 of this Agreement].*
SECTION 5. TERMINATION OF EMPLOYMENT.
(a) All Accrued Benefits to which the Executive (or the
Executive's estate or beneficiary) is entitled shall be payable within
thirty (30) days following termination of the Employment Period, except as
otherwise specifically provided herein or under the terms of any applicable
policy, plan or program, in which case the payment terms of such policy,
plan or program shall be determinative.
(b) Any termination by the Companies, or by the Executive, of
the Employment Period shall be communicated by written notice of such
termination to the Executive, if such notice is delivered by the Companies,
and to the Companies, if such notice is delivered by the Executive, each in
compliance with the requirements of Section 13 hereof. Except in the event
of termination of the Employment Period by reason of Cause or the
Executive's death, the Termination Date shall be no earlier than thirty
(30) days following the date on which notice of termination is delivered by
one party to the other in compliance with the requirements of Section 13
hereof.
(c) If the Employment Period is terminated by the Executive for
Good Reason or by the Companies for any reason other than Cause and other
than within two (2) years following a Change of Control, then, as the
Executive's exclusive right and remedy in respect of such termination:
(i) the Executive shall be entitled to receive from the
Company the Executive's Accrued Benefits in accordance with Section
5(a);
(ii) the Executive shall be entitled to an amount equal to
one and one-half (1-1/2) times the Executive's then existing Base
Salary, to be paid in such intervals and at such times in accordance
with the Company's payroll practices in
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* Bracketed text shown appears in the form of agreement signed by ▇▇. ▇▇▇▇▇.
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effect from time to time over the eighteen (18) month period
following the Termination Date;
(iii) the Executive shall be entitled to a payment in an
amount equal to one and one-half (1 1/2) times the target incentive
compensation award for the calendar year during which the
Termination Date occurs, to be paid in equal installments in such
intervals and at such times in accordance with the Company's payroll
practices in effect from time to time over the eighteen (18) month
period following the Termination Date;
(iv) the Executive shall be entitled to a lump-sum payment
to be paid within thirty (30) days following the Termination Date in
an amount equal to the pro-rata target incentive compensation award
for the calendar year during which the Termination Date occurs, with
such pro-rata target incentive compensation award determined by
multiplying the target incentive compensation award amount by a
fraction, the numerator of which is the number of days in the
calendar year of the Termination Date elapsed prior to the
Termination Date and the denominator of which is three hundred and
sixty-five (365);
(v) the Executive shall continue to be covered, upon the
same terms and conditions described in Section 4(e) hereof, by the
same or equivalent medical, dental, hospitalization, life and
disability insurance plans, programs and/or arrangements as in
effect for the Executive immediately prior to the Termination Date
until the earlier of: (A) the eighteen (18) month anniversary
following the date of the Executive's Termination Date, and (B) the
date the Executive receives substantially equivalent coverage under
the plans, programs and/or arrangements of a subsequent employer;
(vi) if the Executive's outstanding stock options have not
by then fully vested pursuant to the terms of the Companies'
applicable stock option plan(s) and applicable stock option
agreement(s), then to the extent permitted in the Companies'
applicable stock option plan(s) and as provided in the applicable
option agreement(s), the Executive shall continue to vest in the
Executive's unvested stock options following the Termination Date;
and
(vii) the Executive shall be entitled to receive executive
level career transition assistance services provided by a career
transition assistance firm selected by the Executive and paid for by
the Companies in an amount not to exceed twenty percent (20%) of the
sum of (i) the Executive's then existing Base Salary and (ii) the
target incentive compensation award for the calendar year during
which the Termination Date occurs. The Executive shall not be
eligible to receive cash in lieu of executive level career
transition assistance services.
(d) If during the Employment Period, a Change of Control occurs
and the Employment Period is terminated by the Companies for any reason
other than Cause or by the Executive for Good Reason within two (2) years
from the date of such Change of Control, then:
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(i) the Executive shall be entitled to receive from the
Company the Executive's Accrued Benefits in accordance with Section
5(a);
(ii) the Executive shall be entitled to a lump-sum payment
in an amount equal to two (2) times the Executive's then existing
Base Salary, to be paid within thirty (30) days following the
Termination Date;
(iii) the Executive shall be entitled to a lump-sum payment
in an amount equal to two (2) times the Executive's target incentive
compensation award for the calendar year during which the
Termination Date occurs, to be paid within thirty (30) days
following the Termination Date;
(iv) the Executive shall be entitled to a lump-sum payment
to be paid within thirty (30) days following the Termination Date in
an amount equal to the pro-rata target incentive compensation award
for the calendar year during which the Termination Date occurs. Such
pro-rata target incentive compensation award shall be determined by
multiplying the target incentive compensation award amount by a
fraction, the numerator of which is the number of days in the
calendar year of the Termination Date elapsed prior to the
Termination Date and the denominator of which is three hundred and
sixty-five (365).
(v) the Executive shall continue to be covered, upon the
same terms and conditions described in Section 4(e) hereof, by the
same or equivalent medical, dental, hospitalization, life and
disability insurance plans, programs and/or arrangements as in
effect for the Executive immediately prior to the Change of Control
until the earlier of: (A) the second anniversary following the date
of the Executive's Termination Date, and (B) the date the Executive
receives substantially equivalent coverage under the plans, programs
and/or arrangements of a subsequent employer;
(vi) the Executive shall receive two (2) additional years
of credit for purposes of age, benefit service and vesting under the
Company's defined benefit retirement plan;
(vii) if the Executive's outstanding stock options have not
by then fully vested pursuant to the terms of the Companies'
applicable stock option plan(s) and applicable option agreement(s),
then to the extent permitted in the Companies' applicable stock
option plan(s) and as provided in the applicable stock option
agreement(s), the Executive shall continue to vest in the
Executive's unvested stock options following the Termination Date;
(viii) the Executive shall be entitled to receive executive
level career transition assistance services provided by a career
transition assistance firm selected by the Executive and paid for by
the Companies in an amount not to exceed twenty percent (20%) of the
sum of (i) the Executive's then existing Base Salary and (ii) the
target incentive compensation award for the calendar year
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during which the Termination Date occurs. The Executive shall not be
eligible to receive cash in lieu of executive level career
transition assistance services; and
(ix) the Executive shall be entitled to be reimbursed by
the Companies on an as incurred basis for the Executive's reasonable
attorneys' fees, costs and expenses incurred in conjunction with any
dispute regarding Section 5(d).
(e) Except for Executive's vested benefits under the Companies'
employee benefit plans, any amounts payable pursuant to Sections 5(c) and
5(d) above shall be considered severance payments and be in full and
complete satisfaction of the obligations of the Companies to the Executive
in connection with the termination of the Executive's employment. The
Company shall deliver a Form 1099 to the Executive reflecting such
payments.
(f) If the Employment Period is terminated as a result of the
Executive's death, permanent disability (as defined in the Companies'
Board-approved disability plan or policy, as in effect from time to time)
or retirement (as defined in the Companies' Board-approved retirement plan
or policy, as in effect from time to time), then the Executive shall be
entitled to (i) the Executive's Accrued Benefits in accordance with Section
5(a)(ii) any benefits that may be payable to the Executive under any
applicable Board-approved disability, life insurance or retirement plan or
policy in accordance with the terms of such plan or policy, and (iii) a
lump sum payment to be paid within thirty (30) days following the
Termination Date in an amount equal to the pro-rata target incentive
compensation award for the calendar year during which the Termination Date
occurs by reason of the Executive's death, permanent disability or
retirement. Such pro-rata target incentive compensation award shall be
determined by multiplying the target incentive compensation award amount by
a fraction, the numerator of which is the number of days in the calendar
year of the Termination Date elapsed prior to the Termination Date and the
denominator of which is three hundred and sixty-five (365).
(g) Notwithstanding anything else contained herein, if the
Executive voluntarily terminates employment without Good Reason, or the
Companies terminate the Executive's employment for Cause, all of the
Executive's rights to payment from the Companies (including pursuant to any
plan or policy of the Companies) shall terminate immediately, except the
right to payment for Accrued Benefits in respect of periods prior to such
termination and the Executive's vested benefits under the Companies'
employee benefit plans.
(h) Notwithstanding anything to the contrary contained in this
Section 5, the Executive shall be required to execute the Companies' then
current standard release agreement as a condition to receiving any of the
payments and benefits provided for in Sections 5(c) and (d), excluding the
Accrued Benefits in accordance with Section 5(a). It is acknowledged and
agreed that the then current standard release agreement shall be a mutual
release and shall not diminish or terminate the Executive's rights under
this Agreement.
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(i) Upon termination of the Executive's employment with the
Companies, subject to the Executive's affirmative obligations pursuant to
Section 6, the Executive shall be under no obligation to seek other
employment or otherwise mitigate the obligations of the Companies under
this Agreement.
(j) If it shall be determined that any payment or distribution
of any type to or in respect of the Executive made directly or indirectly,
by the Companies, whether paid or payable or distributed or distributable
pursuant to the terms of this Agreement or otherwise (the "TOTAL
PAYMENTS"), is or will be subject to the excise tax imposed by Section 4999
of the Internal Code of 1986, as amended (the "CODE"), or any interest or
penalties with respect to such excise tax (such excise tax, together with
any such interest and penalties, are collectively referred to as the
"EXCISE TAX"), then the Executive shall be entitled to receive an
additional payment (a "GROSS-UP PAYMENT") in an amount such that after
payment by the Executive of all taxes (including any interest or penalties
imposed with respect to such taxes) imposed upon the Gross-Up Payment, the
Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Total Payments.
(i) All computations and determinations relevant to
Section 5(j) and this subsection 5(j)(i) shall be made by a national
accounting firm selected and reimbursed by the Companies from among
the ten (10) largest accounting firms in the United States as
determined by gross revenues (the "ACCOUNTING FIRM"), subject to the
Executive's consent (not to be unreasonably withheld), which firm
may be the Companies' accountants. Such determinations shall include
whether any of the Total Payments are "parachute payments" (within
the meaning of Section 280G of the Code). In making the initial
determination hereunder as to whether a Gross-Up Payment is
required, the Accounting Firm shall determine that no Gross-Up
Payment is required if the Accounting Firm is able to conclude that
no "Change of Control" has occurred (within the meaning of Section
280G of the Code). If the Accounting Firm determines that a Gross-Up
Payment is required, the Accounting Firm shall provide its
determination (the "DETERMINATION"), together with detailed
supporting calculations regarding the amount of any Gross-Up Payment
and any other relevant matter both to the Companies and the
Executive by no later than thirty (30) days following the
Termination Date, if applicable, or such earlier time as is
requested by the Companies or the Executive (if the Executive
reasonably believes that any of the Total Payments may be subject to
the Excise Tax). If the Accounting Firm determines that no Excise
Tax is payable by the Executive, it shall furnish the Executive and
the Companies with a written statement that such Accounting Firm has
concluded that no Excise Tax is payable (including the reasons
therefor) and that the Executive has substantial authority not to
report any Excise Tax on Executive's federal income tax return.
(ii) If a Gross-Up Payment is determined to be payable, it
shall be paid to the Executive within twenty (20) days after the
Determination (and all accompanying calculations and other material
supporting the Determination) is delivered to the Companies by the
Accounting Firm. Any determination by the
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Accounting Firm shall be binding upon the Companies and the
Executive, absent manifest error.
(iii) As a result of uncertainty in the application of
Section 4999 of the Code at the time of the initial determination by
the Accounting Firm hereunder, it is possible that Gross-Up Payments
not made by the Companies should have been made ("UNDERPAYMENT"), or
that Gross-Up Payments will have been made by the Companies which
should not have been made ("OVERPAYMENTS"). In either such event,
the Accounting Firm shall determine the amount of the Underpayment
or Overpayment that has occurred. In the case of an Underpayment,
the amount of such Underpayment (together with any interest and
penalties payable by the Executive as a result of such Underpayment)
shall be promptly paid by the Companies to or for the benefit of the
Executive.
(iv) In the case of an Overpayment, the Executive shall,
at the direction and expense of the Companies, take such steps as
are reasonably necessary (including the filing of returns and claims
for refund), follow reasonable instructions from, and procedures
established by, the Companies, and otherwise reasonably cooperate
with the Companies to correct such Overpayment, provided, however,
that the Executive shall not in any event be obligated to return to
the Companies an amount greater than the portion of the Overpayment
that Executive has retained or has recovered as a refund from the
applicable taxing authorities.
(v) The Executive shall notify the Companies in writing
of any claim by the Internal Revenue Service relating to the
possible application of the Excise Tax under Section 4999 of the
Code to any of the payments and amounts referred to herein and shall
afford the Companies, at their expense, the opportunity to control
the defense of such claim (for the sake of clarity, if the Internal
Revenue Service is successful in any such claim or the Executive
reaches a final settlement with the Internal Revenue Service with
respect to such claim (after having afforded the Companies, at their
expense, the opportunity to control the defense of such claim), the
amount of the Excise Tax resulting from such successful claim or
settlement shall be determinative as to whether or not there has
been an Underpayment or an Overpayment for purposes of subsection
5(j)(iii).
(vi) Without limiting the intent of this Section 5(j) to
make the Executive whole, on an after-tax basis, from the
application of the Excise Taxes, all determinations by the
Accounting Firm shall be made with a view to minimizing the
application of Sections 280G and 4999 of the Code of any of the
Total Payments, subject, however, to the following: the Accounting
Firm shall make its determination on the basis of "substantial
authority" (within the meaning of Section 6230 of the Code) and
shall provide opinions to that effect to both the Companies and the
Executive upon the request of either of them.
12
SECTION 6. FURTHER OBLIGATIONS OF THE EXECUTIVE.
(a) (1) During and following the Executive's employment by
the Companies, the Executive shall not, directly or indirectly, disclose,
disseminate, make available or use any confidential information or
proprietary data of the Companies or any of their Subsidiaries, except as
reasonably necessary or appropriate for the Executive to perform the
Executive's duties for the Companies, or as authorized in writing by the
Board or as required by any court or administrative agency (and then only
after prompt notice to the Companies to permit the Companies to seek a
protective order).
(2) For purposes of this Agreement, "CONFIDENTIAL
INFORMATION OR PROPRIETARY DATA" means information and data prepared,
compiled, or acquired by or for the Executive during or in connection with
the Executive's employment by the Companies (including, without limitation,
information belonging to or provided in confidence by any Customer,
Supplier, trading partner or other Person to which the Executive had access
by reason of Executive's employment with the Companies) which is not
generally known to the public or which could be harmful to the Companies or
their Subsidiaries if disclosed to Persons outside of the Companies. Such
confidential information or proprietary data may exist in any form,
tangible or intangible, or media (including any information
technology-related or electronic media) and includes, but is not limited
to, the following information of or relating to the Companies or any of
their Subsidiaries, Customers or Suppliers:
(i) Business, financial and strategic information, such
as sales and earnings information and trends, material, overhead and
other costs, profit margins, accounting information, banking and
financing information, pricing policies, capital
expenditure/investment plans and budgets, forecasts, strategies,
plans and prospects.
(ii) Organizational and operational information, such as
personnel and salary data, information concerning the utilization or
capabilities of personnel, facilities or equipment, logistics
management techniques, methodologies and systems, methods of
operation data and facilities plans.
(iii) Advertising, marketing and sales information, such as
marketing and advertising data, plans, programs, techniques,
strategies, results and budgets, pricing and volume strategies,
catalog, licensing or other agreements or arrangements, and market
research and forecasts and marketing and sales training and
development courses, aids, techniques, instruction and materials.
(iv) Product and merchandising information, such as
information concerning offered or proposed products or services and
the sourcing of the same, product or services specifications, data,
drawings, designs, performance characteristics, features,
capabilities and plans and development and delivery schedules.
13
(v) Information about existing or prospective Customers
or Suppliers, such as Customer and Supplier lists and contact
information, Customer preference data, purchasing habits, authority
levels and business methodologies, sales history, pricing and rebate
levels, credit information and contracts.
(vi) Technical information, such as information regarding
plant and equipment organization, performance and design,
information technology and logistics systems and related designs,
integration, capabilities, performance and plans, computer hardware
and software, research and development objectives, budgets and
results, intellectual property applications, and other design and
performance data.
(b) All records, files, documents and materials, in whatever
form and media, relating to the Companies' or any of their Subsidiaries'
business (including, but not limited to, those containing or reflecting any
confidential information or proprietary data) which the Executive prepares,
uses, or comes into contact with, including the originals and all copies
thereof and extracts and derivatives therefrom, shall be and remain the
sole property of the Companies or their Subsidiaries. Upon termination of
the Executive's Employment Period for any reason, the Executive shall
immediately return all such records, files, documents, materials and other
property of the Companies and their Subsidiaries in the Executive's
possession, custody or control, in good condition, to the Companies.
(c) During (i) the Executive's employment by the Companies and
(ii) the eighteen (18) month period following the end of the Executive's
Employment Period, the Executive shall not within the United States and
Canada in any capacity (whether as an owner, employee, consultant or
otherwise) at any time perform, manage, supervise, or be responsible or
accountable for anyone else who is performing services -- which are the
same as, substantially similar or related to the services the Executive is
providing, or during the last two years of the Executive's employment by
the Companies has provided, for the Companies or their Subsidiaries -- for,
or on behalf of, any other Person who or which is (1) a wholesaler of
office products, including traditional office products, computer consumable
products, office furniture, janitorial and/or sanitation products,
audio/visual and business machines or such other products whether or not
related to the foregoing provided by the Companies or their Subsidiaries
during the last twelve (12) months of the Executive's Employment Period,
(2) a provider of services the same as or substantially similar to those
provided by the Companies or their Subsidiaries during the last twelve (12)
months of the Executive's Employment Period, or (3) engaged in a line of
business other than described in (1) or (2) hereinabove which is the same
or substantially similar to the lines of business engaged in by the
Companies or their Subsidiaries during the last twelve (12) months of the
Executive's Employment Period.
(d) (1) During (i) the Executive's employment by the
Companies and (ii) the eighteen (18) month period following the end of the
Executive's Employment Period, the Executive shall not at any time,
directly or indirectly, solicit any Customer for or on behalf of any Person
other than the Companies or any of their Subsidiaries with respect to the
purchase of (A) office products, including traditional office products,
computer
14
consumable products, office furniture, janitorial and/or sanitation
products, audio/visual and business machines, or such other products
whether or not related to the foregoing provided by the Companies or their
Subsidiaries to such Customer during the last twelve (12) months of the
Executive's Employment Period, (B) services the same as or substantially
similar to those provided by the Companies or their Subsidiaries to such
Customer during the last twelve (12) months of the Executive's Employment
Period or (C) products or services from a line of business other than as
described in (A) or (B) herein which are the same or substantially similar
to the products and services provided to such Customer from a line of
business engaged in by the Companies or their Subsidiaries during the last
twelve (12) months of the Executive's Employment Period. Without limiting
the foregoing, (i) during the Executive's employment by the Companies and
(ii) insofar as the Executive may be employed by, or acting for or on
behalf of, a Supplier at any time within the eighteen (18) month period
following the end of the Executive's Employment Period, the Executive shall
not at any time, directly or indirectly, solicit any Customer to switch the
purchase of the products or services described hereinabove from the
Companies or their Subsidiaries to Supplier.
(2) For purposes of this Agreement, a "CUSTOMER" is any
Person who or which has ordered or purchased by or from the Companies or
any of their Subsidiaries (A) office products, including traditional office
products, computer consumable products, office furniture, janitorial and/or
sanitation products, audio/visual and business machines or such other
products whether or not related to the foregoing, (B) services provided by
or from the Companies or any of their Subsidiaries or (C) products or
services from a line of business other than as described in (A) or (B)
herein which are the same or substantially similar to the products and
services from a line of business engaged in by the Companies or their
Subsidiaries during the last twelve (12) months of the Executive's
Employment Period. For purposes of this Agreement, a "SUPPLIER" is any
Person who or which has furnished to the Companies or their Subsidiaries
for resale (A) office products, including traditional office products,
computer consumable products, office furniture, janitorial and/or
sanitation products, audio/visual and business machines or such other
products whether or nor related to the foregoing (B) services provided by
or from the Companies or any of their Subsidiaries or (C) products or
services from a line of business other than as described in (A) or (B)
herein which are the same or substantially similar to the products and
services from a line of business engaged in by the Companies or their
Subsidiaries during the last twelve (12) months of the Executive's
Employment Period.
(e) During the Executive's employment by the Companies and
during the eighteen (18) month period following the end of the Executive's
Employment Period, the Executive shall not at any time, directly or
indirectly, induce or solicit any employee of the Companies or any of their
Subsidiaries for the purpose of causing such employee to terminate his or
her employment with the Companies or such Subsidiary.
(f) The Executive shall not, directly or indirectly, make or
cause to be made (and shall prohibit the officers, directors, employees,
agents and representatives of any Person controlled by Executive not to
make or cause to be made) any disparaging, derogatory, misleading or false
statement, whether orally or in writing, to any Person, including members
of the investment community, press, and customers, competitors and
15
advisors to the Companies, about the Companies, their respective parents,
Subsidiaries or Affiliates, their respective officers or members of their
boards of directors, or the business strategy or plans, policies, practices
or operations of the Companies, or of their respective parents,
Subsidiaries or Affiliates.
(g) If any court determines that any portion of this Section 6
is invalid or unenforceable, the remainder of this Section 6 shall not
thereby be affected and shall be given full effect without regard to the
invalid provision. If any court construes any of the provisions of Section
6(c), 6(d), 6(e) or 6(f) above, or any part thereof, to be unreasonable
because of the duration or scope of such provision, such court shall have
the power to reduce the duration or scope of such provision and to enforce
such provision as so reduced.
(h) During the Executive's Employment Period and during the
eighteen (18) month period following the end of Executive's Employment
Period, the Executive agrees that, prior to accepting employment with a
Customer or Supplier of the Companies, the Executive will give notice to
the Chief Executive Officer of the Companies. The Companies reserve the
right to make such Customer or Supplier aware of the Executive's
obligations under Section 6 of this Agreement.
(i) During and following Executive's Employment Period, the
Executive shall furnish a copy of this Section 6 in its entirety to any
prospective employer prior to accepting employment with such prospective
employer.
(j) The Executive hereby acknowledges and agrees that damages
will not be an adequate remedy for the Executive's breach of any provision
of this Section 6, and further agrees that the Companies shall be entitled
to obtain appropriate injunctive and/or other equitable relief for any such
breach, without the posting of any bond or other security, in addition to
all other legal remedies to which the Companies may be entitled.
SECTION 7. SUCCESSORS. The Companies may assign their rights under this
Agreement to any successor to all or substantially all the assets of the
Companies, by merger or otherwise, and may assign or encumber this Agreement and
its rights hereunder as security for indebtedness of the Companies. Any such
assignment by the Companies shall remain subject to the Executive's rights under
Section 5 hereof. The rights of the Executive under this Agreement may not be
assigned or encumbered by the Executive, voluntarily or involuntarily, during
the Executive's lifetime, and any such purported assignment shall be void AB
INITIO. Notwithstanding the foregoing, all rights of the Executive under this
Agreement shall inure to the benefit of and be enforceable by the Executive's
personal or legal representatives, estates, executors, administrators, heirs and
beneficiaries. All amounts payable to the Executive hereunder shall be paid, in
the event of the Executive's death, to the Executive's estate, heirs or
representatives.
SECTION 8. THIRD PARTIES. Except for the rights granted to the
Companies and their Subsidiaries pursuant hereto (including, without limitation,
pursuant to Section 6 hereof) and except as expressly set forth or referred to
herein, nothing herein expressed or implied is intended or shall be construed to
confer upon or give any person other than the parties hereto and
16
their successors and permitted assigns any rights or remedies under or by reason
of this Agreement.
SECTION 9. ENFORCEMENT. The provisions of this Agreement shall be
regarded as divisible and, if any of said provisions or any part or application
thereof is declared invalid or unenforceable by a court of competent
jurisdiction, the same shall not affect the other provisions hereof, other parts
or applications thereof or the whole of this Agreement, but such provision shall
be deemed modified to the extent necessary to render such provision enforceable,
and the rights and obligations of the parties shall be construed and enforced
accordingly, preserving to the fullest permissible extent the intent and
agreements of the parties herein set forth.
SECTION 10. AMENDMENT. This Agreement may not be amended or modified at
any time except by a written instrument approved by the Board, and executed by
the Companies and the Executive; PROVIDED, HOWEVER, that any attempted amendment
or modification without such approval and execution shall be null and void AB
INITIO and of no effect.
SECTION 11. PAYMENT AND WITHHOLDING. The Company shall be responsible as
employer for payment of all cash compensation and severance payments provided
herein and Holding shall cause the Company to make such payments. The Executive
shall not be entitled to receive any additional compensation from either of the
Companies for any services the Executive provides to Holding or the Companies'
Subsidiaries. The Company shall be entitled to withhold from any amounts to be
paid to the Executive hereunder any federal, state, local, or foreign
withholding or other taxes or charges which it is from time to time required to
withhold. The Company shall be entitled to rely on an opinion of counsel if any
question as to the amount or requirement of any such withholding shall arise.
SECTION 12. GOVERNING LAW. This Agreement and the rights and obligations
hereunder shall be governed by and construed in accordance with the laws of the
State of Illinois, without regard to principles of conflicts of law of Illinois
or any other jurisdiction.
SECTION 13. NOTICE. Notices given pursuant to this Agreement shall be in
writing and shall be deemed given when received and, if mailed, shall be mailed
by United States registered or certified mail, return receipt requested,
addressee only, postage prepaid:
IF TO THE COMPANIES:
United Stationers Inc.
United Stationers Supply Co.
▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: President and Chief Executive Officer
IF TO THE EXECUTIVE:
[Name]
[Address]
17
or to such other address as the party to be notified shall have given to the
other in accordance with the notice provisions set forth in this Section 13.
SECTION 14. NO WAIVER. No waiver by either party at any time of any
breach by the other party of, or compliance with, any condition or provision of
this Agreement to be performed by the other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at any time.
SECTION 15. HEADINGS. The headings contained herein are for reference
only and shall not affect the meaning or interpretation of any provision of this
Agreement.
SECTION 16. INDEMNIFICATION. The provisions set forth in the
Indemnification Agreement appended hereto as ATTACHMENT A are hereby
incorporated into this Agreement and made a part hereof. The parties shall
execute the Indemnification Agreement contemporaneously with the execution of
this Agreement.
SECTION 17. EXECUTION IN COUNTERPARTS. This Agreement, including the
Indemnification Agreement, may be executed in any number of counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
SECTION 18. ARBITRATION. Any dispute, controversy or question arising
under, out of, or relating to this Agreement (or the breach thereof), or, the
Executive's employment with the Companies or termination thereof, shall be
referred for arbitration in Chicago, Illinois to a neutral arbitrator selected
by the Executive and the Companies (or if the parties are unable to agree on
selection of such an arbitrator, one selected by the American Arbitration
Association pursuant to its rules referred to below) and this shall be the
exclusive and sole means for resolving such dispute. Such arbitration shall be
conducted in accordance with the National Rules for Resolution of Employment
Disputes of the American Arbitration Association. Except as provided in Section
5(d)(ix) above, the arbitrator shall have the discretion to award reasonable
attorneys' fees, costs and expenses to the prevailing party. Judgment upon the
award rendered by the arbitrator may be entered in any court having jurisdiction
thereof. Nothing in this Section 18 shall be construed so as to deny the
Companies the right and power to seek and obtain injunctive relief in a court of
equity for any breach or threatened breach by the Executive of any of the
Executive's covenants in Section 6 hereof. Moreover, this Section 18 and Section
12 hereof shall not be applicable to any dispute, controversy or question
arising under, out of, or relating to the Indemnification Agreement.
SECTION 19. SURVIVAL. Notwithstanding the stated Term of this Agreement,
the provisions of this Agreement necessary to carry out the intention of the
parties as expressed herein, including without limitation those in Sections 5,
6, 7, 16 and 18, shall survive the termination or expiration of this Agreement.
SECTION 20. CONSTRUCTION. The parties acknowledge that this Agreement is
the result of arm's-length negotiations between sophisticated parties each
afforded representation by legal counsel. Each and every provision of this
Agreement shall be construed as though both parties participated equally in the
drafting of same, and any rule of construction that a document shall be
construed against the drafting party shall not be applicable to this Agreement.
18
SECTION 21. FREE TO CONTRACT. The Executive represents and warrants to
the Companies that the Executive is able freely to accept employment by the
Companies as described in this Agreement and that there are no existing
agreements, arrangements or understandings, written or oral, that would prevent
the Executive from entering into this Agreement, would prevent or restrict the
Executive in any way from rendering services to the Companies as provided herein
during the Employment Period or would be breached by the future performance by
the Executive of the Executive's duties and responsibilities hereunder.
SECTION 22. ENTIRE AGREEMENT. This Agreement, including the
Indemnification Agreement, supersedes all other agreements, arrangements or
understandings (whether written or oral) between the Companies and the Executive
with respect to the subject matter of this Agreement and the Executive's
employment relationship with the Companies and any of their Subsidiaries, and
this Agreement contains the sole and entire agreement among the parties hereto
with respect to the subject matter hereof.
* * *
IN WITNESS WHEREOF, the parties have executed this Agreement in one or more
counterparts, each of which shall be deemed one and the same instrument, as of
the day and year first written above.
UNITED STATIONERS INC.
By:
--------------------------------------
Name:
Title:
UNITED STATIONERS SUPPLY CO.
By:
--------------------------------------
Name:
Title:
EXECUTIVE:
-----------------------------------------
[Name]
19
APPENDIX A
▇▇▇▇ ▇. ▇▇▇▇▇**
1. With respect to Section 4(a) hereof, commencing January 1, 2003
(assuming he then remains in employment with the Companies), the
Executive's Base Salary shall be at an annual rate of not less than
$250,000.
2. With respect to Section 4(b) hereof, the Executive's target Annual
Bonus for calendar year 2002 shall be forty percent (40%) of Base
Salary, with an $80,000 Annual Bonus guaranteed (absent termination
of the Executive's employment for Cause) for calendar year 2002 and
payable in the first calendar quarter of 2003, subject to increase
if the Bonus Plan calculation exceeds target. The Executive's Target
Annual Bonus for calendar year 2003 shall be fifty percent (50%) of
Base Salary.
3. Executive shall be paid a lump sum retention (stay) bonus of
$100,000, payable on or before April 10, 2003, if the Executive has
continued in employment with the Companies through and including
March 31, 2003. If the Executive has not continued in employment
with the Companies through and including March 31, 2003 by reason of
the Executive's death, disability, or termination of his employment
by the Companies for any reason other than Cause, the Executive (or
his estate) shall be entitled to be paid a pro-rata lump sum
retention (stay) bonus in 2003 and no later than April 10, 2003.
Such pro-rata lump sum retention (stay) bonus shall be determined by
multiplying $100,000 by a fraction, the numerator of which is the
number of days elapsed between January 14, 2002 and the Executive's
Termination Date prior to March 31, 2003 by reason of death,
disability, or termination by the Companies for any reason other
than Cause and the denominator of which is four hundred and
forty-one (441).
4. Executive received a grant of 6,000 restricted shares of common
stock of United Stationers Inc. effective on January 29, 2002, with
the terms of such grant as set forth in the related Restricted Stock
Award Agreement dated as of January 29, 2002 ("Restricted Stock
Award Agreement") and hereinafter summarized. All of such shares of
restricted stock vest on January 1, 2005 if the Executive has
remained in employment with the Companies through and including such
date. If the Executive has not continued in employment with the
Companies through and including January 1, 2005 by reason of the
Executive's death, disability, or termination by the Companies for
any reason other than Cause, a pro rata portion of such shares of
restricted stock shall vest as of the date of such death, disability
or employment termination other than for Cause, with the remainder
of such shares forfeited. The number of restricted shares that shall
be subject to such pro-rata vesting shall be determined by
multiplying 6,000 by a fraction, the numerator of which is the
number of whole and partial months elapsed between February 1, 2002
and
----------
** This Appendix A attached and applicable only to agreement signed by ▇▇.
▇▇▇▇▇.
20
the Executive's Termination Date prior to January 1, 2005 by reason
of death, disability, or termination by the Companies for any reason
other than Cause and the denominator of which is thirty-five (35).
In the event of any conflict between the terms of this Agreement
(including this Appendix A) and the Restricted Stock Award
Agreement, the terms of the Restricted Stock Award Agreement will
govern.
5. With respect to Section 4(d) hereof, the Executive shall be entitled
to a supplemental pension benefit (a "Supplemental Pension") with
respect to each pension plan (within the meaning of Section 3(2) of
the Employee Retirement Income Security Act of 1974, as amended)
which is a defined benefit pension plan maintained by the Companies
and in which the Executive participates or will participate which is
qualified under Code Section 401(a) and whether presently
established or established hereafter ("Retirement Plan"). With
respect to each Retirement Plan, the Executive shall be entitled to
a Supplemental Pension determined in accordance with the terms of
the respective Retirement Plan now in effect or adopted in the
future and as adjusted for any subsequent changes; PROVIDED,
HOWEVER, that with respect to any Retirement Plan, the Supplemental
Pension shall be determined as the additional incremental benefit
Executive would be entitled to receive in excess of the actual
benefit under the respective Retirement Plan if the Executive would
be entitled to credit for 5 years of age, vesting and credited
service in addition to the Executive's actual vesting and credited
service under the terms of the respective Retirement Plan. Each
Supplemental Pension shall be paid at the same time and in the same
manner as, when and how the pension benefit under the respective
Retirement Plan is paid to the Executive (after giving effect to the
additional 5 years of credit provided above). In addition, except as
otherwise provided in this paragraph, the Executive's entitlement to
a Supplemental Pension, including without limitation any survivor
benefit, claims procedures, methods of payment, etc. shall be
determined in accordance with the provisions of the respective
Retirement Plan.
21
Attachment A
Form of Indemnification Agreement entered into among United, USSC (only as to
selected provisions) and various executive officers of United as Exhibit 10.7 to
this Quarterly Report on Form 10-Q.
22
