Exhibit 10.1
SECOND AMENDMENT TO EMPLOYMENT AGREEMENT
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THIS SECOND AMENDMENT TO EMPLOYMENT AGREEMENT is dated as of this 19th
day of August, 2004, between TASTY BAKING COMPANY, a Pennsylvania corporation
(the "Company") and XXXXXXX X. XXXXX ("Executive").
Background
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The Company and Executive have entered into an Employment Agreement
dated as of August 14, 2002 and a First Amendment to Employment Agreement dated
as of January 19, 2004 (together, the "Employment Agreement") pursuant to which
Executive became employed as the President and Chief Executive Officer of the
Company effective October 7, 2002. The parties desire to amend the Employment
Agreement for the purposes and with the effect stated herein.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and intending to be legally bound hereby, the Company and Executive
agree as follows:
1. Amendment to Section 1. The second sentence of Section 1 of the
Agreement is hereby amended and restated to read in its entirety as follows:
"The term of employment of Executive under this Agreement shall
commence on October 7, 2002 (the "Commencement Date") and shall
continue, unless terminated in accordance with the provisions of
Section 5 hereof, through the third anniversary of the Commencement
Date and shall be automatically renewed on the third anniversary of the
Commencement Date and every anniversary thereafter for an additional
one year period, unless either party gives notice of non-renewal to the
other party in writing at least 90 days prior to the end of the then
current term."
2. Amendment to Section 4(c). The second sentence of Section 4(c) of
the Agreement is hereby amended and restated to read in its entirety as follows:
"In addition, provided Executive is in good health and insurable at
regular rates, the Company shall obtain for the benefit of the
Executive, and maintain and pay the premiums for, a term life insurance
policy in the amount of (i) One Million Dollars ($1,000,000.00) for the
period beginning on the Commencement Date and ending on the fifth
anniversary of the Commencement Date, and (ii) an additional One
Million Dollars ($1,000,000.00) beginning on October 1, 2004 or as soon
as practicable thereafter and ending on the fifth anniversary of the
Commencement Date."
3. Amendment to Section 5(d). Section 5(d) of the Agreement is hereby
amended and restated to read in its entirety as follows:
"(d) For purposes of this Agreement, "good reason" shall mean (i) a
material change in the authority, duties and responsibilities of the
Executive so as to be inconsistent with those of president and chief
executive office of the Company, (ii) the relocation of the Executive's
place of employment to a place (other than the Company's Oxford plant)
outside a radius of 30 miles from the Company's Hunting Park Avenue
plant in Philadelphia, (iii) the Company's continued failure to perform
its duties hereunder in any material respect, which failure has not
been cured within 20 days after written notice of such failure (with
specific reference to this Section of the Agreement) has been given by
Executive to the Company, (iv) a material reduction in the
indemnification provided by the Company to the Executive, except in the
event that such a reduction in indemnification is applicable to all
directors and officers of the Company on a uniform basis, or (v)
Executive ceases involuntarily to be a member of the Board of Directors
(other than by reason of death, disability or termination for cause)."
4. Amendment to Section 6. Subsection 6(c)(iii) of the Agreement is
hereby amended and restated to read in its entirety as follows:
"(iii) any unpaid accrued benefits due to Executive through the date of
such termination under this Agreement, the SERP (except that the
Executive shall have no rights under the SERP in the event his
employment is terminated by the Company for cause as defined in
Sections 5(b)(i), 5(b)(ii) or 5(b)(iii) above) or any employee benefit
plan in which Executive was a participant,"
5. Amendment to Exhibit A. Exhibit A of the Employment Agreement is
hereby deleted in its entirety and replaced with amended Exhibit A
attached hereto and incorporated herein by reference.
6. General. In all other respects, except as expressly amended hereby,
the Employment Agreement remains in full force and effect as of the
date hereof. This Second Amendment to Employment Agreement represents
the entire understanding of the parties hereto and supersedes all prior
agreements and understandings, oral or written, relating to the subject
matter hereof, and no change, alteration or modification hereof may be
made except in a writing signed by both parties hereto.
[THIS SPACE INTENTIONALLY LEFT BLANK.]
IN WITNESS WHEREOF, the parties have executed this Second Amendment to
Employment Agreement as of the date and year first written above.
TASTY BAKING COMPANY
_______________________________ By: _____________________________
Xxxxxxx X. Xxxxx Xxxxx X. Xxxxxxxx
Chairman of the Board
By: _____________________________
Xxxxxx X. von Seldeneck
Chair of the Compensation Committee
Exhibit A
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TASTY BAKING COMPANY
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN AGREEMENT
AMENDED AND RESTATED
EFFECTIVE AUGUST 19, 2004
THIS AGREEMENT, entered into as of the 19th day of August,
2004, by and between Tasty Baking Company, a Pennsylvania corporation
(hereinafter referred to as "Employer") and Xxxxxxx X. Xxxxx (hereinafter
referred to as "Employee").
W I T N E S S E T H:
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WHEREAS, the Employer and the Employee entered into a
Supplemental Executive Retirement Plan Agreement (the "Agreement") as of October
7, 2002; and
WHEREAS, the Employer and the Employee desire to change the
terms and conditions under which benefits shall be paid to the Employee under
the Agreement.
NOW, THEREFORE, the parties hereto, intending to be legally
bound, hereby amend and restate the Agreement, effective as of August 19, 2004,
as follows:
ARTICLE I: CONTRIBUTIONS
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1. Initial Contribution Credit. Effective as of September 30, 2004, the
Employer shall credit an amount equal to $172,500 to an unfunded notional
account on behalf of the Employee.
2. Subsequent Contribution Credits. As of the end of each month
subsequent to September 30, 2004, the Employer shall credit a contribution to
such notional account on behalf of the Employee in an amount equal to 39% of the
base salary and bonus paid by the Employer
to the Employee during such month. In no event shall any contributions be
credited to such notional account on behalf of the Employee after the Employee
attains age 67.
3. Interest Credit. As of the end of each month subsequent to September
30, 2004, the Employer shall credit interest to such notional account an amount
equal to the product of (a) 1/12 of the interest crediting rate for the calendar
year and (b) the Employee's account balance at the beginning of the month.
4. Interest Crediting Rate. The interest crediting rate for a calendar
year will be Xxxxx'x Xx rate for corporate bonds as of the last business day
preceding the beginning of the calendar year.
5. Change of Control. In the event the Employer undergoes a "change of
control," as defined in the Employee's Employment Agreement with the Employer,
the Employer guarantees that three additional annual contribution credits, as
determined under paragraph 2, above based upon the Employee's base salary and
bonus for the calendar year immediately prior to the calendar year in which he
terminates employment following a change of control, shall be credited to the
Employee's notional account if and only to the extent that (a) Employee does not
continue to perform service for the Employer for at least 36 months after the
change of control and (b) Employee does not receive at least 36 months of
contribution credits for such service under paragraph 2, above. In no event
shall the guarantee of additional annual contribution credits under this
paragraph be applicable for any calendar year that the Employee continues to
perform service for the Employer after the year in which the Employee attains
age 62.
6. Benefits Under this Agreement. Benefits shall be paid to the
Employee pursuant to the notional account established by the Employer for the
benefit of the Employee in accordance with this Agreement and shall be in lieu
of and not supplementary to the benefits
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accrued by the Employee under the terms of this Agreement as in effect prior to
August 19, 2004.
ARTICLE II: PAYMENT OF BENEFITS
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1. Retirement. In the event that Employee separates from service with
the Employer on or after age 57, his entire notional account balance, valued as
of the end of the month preceding payment, shall be paid to him in a lump sum on
the first business day of the month following the date of his separation from
service.
2. Disability. In the event that Employee separates from service with
the Employer as a result of being "disabled," within the meaning of and
determined under the Employer's long-term disability program, his entire
notional account balance, valued as of the end of the month preceding payment,
shall be paid to him in a lump sum on the first business day of the month
following the date of the determination that he is disabled.
3. Death. In the event that Employee dies prior to receiving any
benefits pursuant to this Agreement, his entire notional account balance, valued
as of the end of the month preceding payment, shall be paid in a lump sum to his
surviving spouse on the first business day of the month following the date of
his death. In the event the Employee is unmarried on the date of his death, his
entire notional account balance, valued as of the end of the month preceding
payment, shall be paid to his designated beneficiary(ies) or, if none, to his
estate, on the first business day of the month following the date of his death
4. Other Termination of Employment. In the event Employee terminates
employment prior to age 57 for reasons other than death or being disabled, his
entire notional account balance, valued as of the end of the month preceding
payment, shall be paid to him in a lump sum on the first business day of the
month following the date Employee attains age 57
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unless (a) the independent directors of the Board of Directors, at the
recommendation of the Compensation Committee of the Board, decides to pay him in
benefits in a lump sum prior to age 57 or (b) he terminates subsequent to a
"change of control" as defined in Employee's Employment Agreement with the
Employer. If the Employee terminates employment subsequent to a change of
control, but prior to age 57, his entire notional account balance shall be paid
to him in a lump sum on the first business day of the month following the date
he terminates employment.
ARTICLE III: VESTING/FORFEITURE OF BENEFITS
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The Employee shall be immediately and fully vested in all amounts
credited to his notional account pursuant to this Agreement on or after
September 30, 2004. Notwithstanding the preceding sentence, the Employee's
entire notional account balance shall be forfeited if his employment is
terminated by the Employer for "cause", as defined in subparagraphs (i), (ii) or
(iii) of Section 5(b) of Employee's Employment Agreement with the Employer. No
other termination of employment of Employee under his Employment Agreement with
the Employer shall result in a forfeiture of any amounts payable to him under
this Agreement except as otherwise expressly provided herein.
ARTICLE IV: TERMINATION OF EMPLOYMENT
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This Agreement shall not in any way constitute an employment agreement
between Employee and Employer and shall in no way obligate Employer to continue
the employment of Employee with Employer. This Agreement shall not limit the
right of Employer to terminate Employee's employment with Employer in accordance
with Employee's employment agreement with the Employer.
ARTICLE V: ASSIGNMENT
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The right of the Employee to the payment of benefits under this
Agreement shall not be assigned, transferred, pledged, or encumbered. Further,
said right shall not be subject to devise or bequest nor shall it survive the
death of the Employee for any reason or circumstance, except as provided in
Section 3 of Article II, above.
ARTICLE VI: LACK OF FIDUCIARY RELATIONSHIP
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Nothing contained in this Agreement and no action taken pursuant to the
provisions of this Agreement shall create or be construed to create a trust of
any kind, or a fiduciary relationship between the Employer and the Employee or
any other person. Any funds which may be invested for the purpose of fulfilling
the obligations which may arise under the provisions of this Agreement shall
continue for all purposes to be a part of the general funds of the Employer and
no person other than the Employee shall, by virtue of the provisions of this
Agreement, have any interest in such funds. To the extent that any person
acquires a right to receive payments from the Employer under this Agreement,
such right shall be no greater than the right of any unsecured general creditor
of the Employer.
ARTICLE VII: MODIFICATION
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This Agreement may be revised only in writing signed by the parties
hereto.
ARTICLE VIII: GOVERNING LAW
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This Agreement shall be construed in accordance with the laws of the
Commonwealth of Pennsylvania.
ARTICLE IX: MISCELLANEOUS
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1. Status of Payments. Any contribution credit or benefit payable under
this Agreement shall not be included for the purpose of computing benefits to
which the Employee
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may be entitled under any pension plan or other arrangement of the Employer for
the benefit of its employees.
2. Interpretation. The Compensation Committee of the Board of Directors
(the "Committee") shall have full power and discretionary authority to
interpret, construe and administer this Agreement and the Committee's
interpretation and construction thereof and actions thereunder, taken by
majority vote, including any valuation of the supplemental retirement
compensation amount to be paid, shall be binding and conclusive on all persons
for all purposes. No member of the Committee or member of the Board shall be
liable to any person for any action taken or omitted in connection with the
interpretation or administration of this Agreement unless attributable to his
own willful misconduct or lack of good faith.
3. Claims Procedure.
(a) The Committee shall prescribe a form for the presentation
of claims under the terms of this Agreement.
(b) Upon presentation to the Committee of the claim on the
prescribed form, the Committee shall make the determination of the validity
thereof. If the determination is adverse to the claimant, the Committee shall
furnish to the claimant within 90 days after receipt of the claim a written
notice setting forth the following:
(i) The specific reason or reasons for the denial;
(ii) Specific references to pertinent provisions of the
Agreement on which the denial is based;
(iii) A description of any additional materials or
information necessary for the claimant to perfect the claim and an explanation
of why such material or information is necessary; and
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(iv) Appropriate information as to the steps to be taken if
the claimant wishes to submit his or her claim for review.
(c) In the event of a denial of a claim, the claimant or his
or her duly authorized representative may appeal such denial to the Committee
for a full and fair review of the adverse determination. The claimant's request
for a review must be in writing and made to the Committee within 60 days after
receipt by the claimant of the written notification required under paragraph (b)
above; provided, however, such 60-day period shall be extended if the
circumstances so warrant. The claimant or his or her duly authorized
representative may submit issues and comments in writing which will be given
full consideration by the Committee in its review.
(d) The Committee may, in its sole discretion, conduct a
hearing. A request for a hearing made by the claimant will be given full
consideration. At such hearing, the claimant shall be entitled to appear and
present evidence and to be represented by counsel.
(e) The Committee shall make a decision on a request for
review not later than 60 days after receipt of the request; provided, however,
in the event of a hearing or other special circumstances, such decision shall be
made not later than 120 days after receipt of such request. If it is necessary
to extend the period of time for making a decision beyond 60 days after the
receipt of the request, the claimant shall be notified in writing of the
extension of time prior to the beginning of such extension.
(f) The Committee's decision on review shall state in writing
the specific reasons and references to the provisions of the Agreement upon
which it is based. Such decision shall be promptly provided to the claimant. If
the decision on review is not furnished in accordance with the foregoing, the
claim shall be deemed denied on review.
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4. Withholding. Any benefit payable under this Agreement shall be
subject to applicable federal, state and local income and employment tax
withholding.
IN WITNESS WHEREOF, the parties hereto have set their hands and seals
the day and year first above written.
ATTEST: TASTY BAKING COMPANY
By:
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Secretary Xxxxx X. Xxxxxxxx
Chairman of the Board
By:
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Xxxxxx X. von Seldeneck
Chair of the Compensation Committee
WITNESS:
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Xxxxxxx X. Xxxxx
814543
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