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Exhibit 10(e)
Executive Compensation Plans and Arrangements
Agreement dated May 2, 1997 between Xxxxxx Greetings, Inc. and Xxxxxxx X. Xxxxx
May 2, 1997
Xx. Xxxxxxx X. Xxxxx
0000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Dear Xxxx:
Xxxxxx Greetings, Inc. and I are very pleased that you have agreed to serve as
Senior Vice President, Sales of Xxxxxx Greetings, Inc. (the Company). As Senior
Vice President, Sales, you will report directly to me. The following terms and
conditions will govern your service to the Company.
1. You will serve the Company on a full-time basis as a senior executive
employee, and the Company will employ you as such, commencing May 19,
1997. This Agreement will extend indefinitely until terminated by the
Company, or by you upon thirty days' advance written notice to the
Company. In the event that this Agreement and your employment are
terminated by the Company other than for cause, you will be entitled to
receive in a lump sum from the Company in lieu of all other monies or
benefits provided under this Agreement, and in lieu of severance pay
pursuant to Company policy, an amount equal to your base salary for a
period of one year or to severance pay in an amount equal to 24 months'
salary. The amount of said severance pay shall, during the your first
year of employment, reduce by one month for each month you are
employed. This Agreement will at all times remain subject to earlier
termination for cause.
2. Your annual salary will be $225,000, which amount will be reviewed
every fifteen months and which may be adjusted from time to time by the
Company in accordance with the Company's salary administration program.
3. A signing bonus in the amount of $80,000 will be paid to you soon after
you begin employment with the Company.
4. Every three years, you will be provided a new automobile of such class
as may be set forth in the Company's then current automobile program,
which automobile will be owned or leased by the Company.
5. As a participant in the Company's Management Bonus Plan, you will be
eligible for an annual bonus for 1997 and for each calendar year during
the term of this Agreement up to a maximum of 112.5% of your base
salary, subject to the terms and conditions of the Management Bonus
Plan in effect for each such year. For the 1997 fiscal year, you will
be guaranteed a bonus of at least $100,000. Further, your bonus for
1997 will be calculated on the premise of $225,000 of earnings, as
though you will have worked for Xxxxxx for the full year.
6. As additional consideration for this Agreement, and contingent upon
approval by the Compensation Committee, you will be granted a stock
option for 50,000 shares of the common stock of the Company at the
closing market price of the stock on the official grant date. One third
of such options shall become vested on each of the first three
anniversaries of the grant. Such vesting shall be conditioned upon your
continuing to be employed by the Company on each such date.
7. The Company will reimburse you in accordance with the terms of the
Company's Executive Relocation and Moving Expense policy for your
reasonable expenses of moving from Barrington, Illinois to Cincinnati,
Ohio, including, but not limited to: household moving costs; your
travel expenses for house-hunting trips as approved in advance by the
Company; realtor fees and transfer taxes on the sale of your present
home in Barrington; and closing costs related to your purchase of a
home in the Cincinnati area. We will provide you temporary housing in
Cincinnati for up to six months.
8. You will be covered by the Company's special benefit programs for
executives which include: executive physical examinations, life
insurance, tax preparation and estate planning assistance. The amount
of your life insurance shall be three (3) times your annual salary, not
to exceed $600,000.
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9. Upon approval of the Compensation Committee, you will be named a
participant in the Company's ERISA Makeup Plan and its Supplemental
Executive Retirement Plan (SERP).
10. You will be eligible for participation in all other benefit plans
available to the employees of the Company, in accordance with the terms
of those plans, including participation in the Voluntary Deferred
Compensation Plan, the 401(k) Plan, the Retirement Income Plan and
health insurance.
11. You will be eligible for four weeks of paid vacation during each year
this Agreement remains in effect.
12. Your employment and this agreement shall terminate automatically upon
your disability or death. All other benefits due you following
termination of your employment and this agreement for disability or
death shall be determined in accordance with the plans, policies and
practices of the Company.
13. In the event you voluntarily terminate your employment during the term
of this Agreement, or if the Company terminates this Agreement and your
employment for cause, your right to all compensation hereunder shall
cease as of the date of termination. As used in this Agreement, "cause"
shall mean fraud, gross negligence, or willful misconduct in the
performance of your duties or a willful and material breach of this
Agreement. Termination of employment shall terminate this Agreement
with the exception of the provisions of Paragraphs 14, 15 and 16.
14. Also in the event you voluntarily terminate your employment hereunder
or retire, or if the Company terminates this Agreement and your
employment for cause, you agree that for a period of one year after
such termination, you will not compete, directly or indirectly, with
the Company or with any division, subsidiary or affiliate of the
Company or participate as a director, officer, employee, consultant,
advisor, partner or joint venturer in any business engaged in the
manufacture and/or sale at wholesale of greeting cards, gift wrap or
other products produced or sold by the Company, or by any division,
subsidiary or affiliate of the Company, without the Company's prior
written consent. If the Company chooses to terminate this Agreement and
you continue to be employed by the Company as an employee, agent,
consultant or otherwise, you agree that this paragraph shall continue
to bind you for a period of one (1) year after your separation from the
Company as an employee, agent, consultant or otherwise.
15. In the event that your employment with the Company is terminated for
any reason, by you or the Company, you agree that, for a period of one
year following such termination of employment, you shall not in any way
solicit or recruit any employee of the Company, its affiliates or
subsidiaries, for any employment, consulting or other arrangement for
your benefit or that of any third party.
16. In connection with this Agreement, you may receive confidential
information of the Company. You agree, both during the term of this
Agreement and after termination, not to disclose to others, assist
others in the application of, or use for your own gain, such
information, or any part thereof, unless and until it has become public
knowledge or has come into the possession of others by legal and
equitable means. You further agree that, upon termination of employment
with the Company, all documents, records, notebooks, and similar
writings, including copies thereof, then in your possession, whether
prepared by you or by others, will be left with or returned promptly to
the Company. For purposes of this paragraph, "confidential information"
means information concerning Company's finances, plans, sales,
products, processes and services, or those of Company's subsidiaries,
divisions or affiliates, which is disclosed to you or known by you as a
consequence of or through your employment with the Company, and which
is not generally known in the industry in which the Company or its
subsidiaries, divisions or affiliates are or may become engaged. You
agree that this paragraph will continue to bind you notwithstanding the
termination of this Agreement or your employment for any reason
whatsoever. If the Company chooses to terminate this Agreement and you
continue to be employed by the Company as an employee, agent,
consultant or otherwise, you agree that this paragraph will continue to
bind you after your separation from the Company as an employee, agent
or consultant.
17. Other than as set forth in Paragraph 1, nothing herein is intended to
be granted to you in lieu of any rights or privileges to which you may
be entitled as an executive employee of the Company under any
retirement, insurance, hospitalization, or other plan which may now or
hereafter be in effect.
18. This Agreement will inure to the benefit of and be binding upon you and
your legal representatives as well as the Company, its successors and
assigns including, without limitation, any person, partnership,
corporation or other entity which may acquire all, or substantially
all, of the Company's assets and business.
19. If any provision of this Agreement is later deemed to be void, that
provision may be stricken and the remaining portions of this Agreement
enforced as if the provision so stricken had never been included
herein.
20. The Company will reimburse you for membership in a country club of your
choice, and any business related expenses.
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To indicate your acceptance of and willingness to be bound by this Agreement,
please sign and return one duplicate original of this letter.
Sincerely,
XXXXXX GREETINGS, INC.
/s/ XXXXX X. X'XXXXXXX
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Xxxxx X. X'Xxxxxxx
President and
Chief Executive Officer
ACCEPTED AND AGREED TO:
/s/ XXXXXXX X. XXXXX
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Xxxxxxx X. Xxxxx
Date: May 5, 1997
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