EXHIBIT 10k2
AMENDMENT TO SEVERANCE AGREEMENT
This AMENDMENT effective as of January 29, 1996 to the Severance
Agreement (the "Agreement") dated as of February 24, 1995 between AMERICAN
BRANDS, INC., a Delaware corporation (the "Company"), and XXXXXXX X. XxXXXX (the
"Executive");
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, the Company and the Executive entered into the Agreement in
order to provide severance benefits in the event of termination of employment;
and
WHEREAS, the Company and the Executive desire to amend the Agreement as
set forth herein;
NOW, THEREFORE, in consideration of the premises and to further assure
the retention of the Executive in the employ of the Company after the date of
this Amendment to Severance Agreement, the parties hereto do hereby agree as
follows:
1. Section 2(b)(ii)(B) of the Agreement is hereby amended in its
entirety as follows:
"(B) the lesser of the number two and the number of years (and fraction
thereof) from the Termination Date to the Executive's Normal Retirement Date
(as defined in the Retirement Plan for Employees and Former Employees of
American Brands, Inc. (the "Retirement Plan"))."
2. Section 2(c) of the Agreement is hereby amended by changing
"one-year period" in each place it appears therein to "two-year period".
3. Section 2(d) of the Agreement is hereby amended in its entirety as
follows:
"(d) If the Company shall terminate the Executive's employment other
than for Disability or Cause, then in addition to the retirement benefits to
which the Executive is entitled under the Retirement Plan, the Supplemental
Plan and any other defined benefit pension plan maintained by the Company or
any affiliate, and any other program, practice or arrangement of the Company
or any affiliate to provide the Executive with a defined pension benefit
after termination of employment, and any successor plans thereto (all such
plans being collectively referred to herein as the "Pension Plans"), the
Company shall pay the Executive monthly beginning at the date that payments
commence under the Retirement Plan an amount equal to the excess of (i) over
(ii) below where
(i) equals the sum of the aggregate monthly amounts of pension
payments (determined as a straight life annuity) to which the Executive
would have been entitled under the terms of each of the Pension Plans
in which he was an active participant (without regard to any amendment
made subsequent to the date hereof which adversely affects in any
manner the computation of the Executive's benefits) determined as if he
were fully vested thereunder and had accumulated two additional years
(or, if less, the number of years (and fraction thereof) from the
Termination Date to the Executive's Normal Retirement Date) of Service
thereunder (subsequent to his Termination Date) at his rate of Actual
Earnings in effect on the date hereof plus any increases subsequent
thereto,
and where
(ii) equals the sum of the aggregate monthly amounts of pension
payments (determined as a straight life annuity) to which the Executive
is entitled under the terms of each of the Pension Plans in which he
was an active participant at the date hereof or subsequently.
For purposes of clause (i), the amounts payable pursuant to Sections
2(b)(ii)(A)(1) and (2) and (2)(b)(ii)(B) shall be considered as part of the
Executive's Actual Earnings and such amounts shall be deemed to represent
two years (or, if less, the number of years (and fraction thereof) from the
Termination Date to the Executive's Normal Retirement Date) of Actual
Earnings for purposes of determining his highest consecutive five year
average rate of Actual Earnings. The supplemental pension benefits
determined under this Section 2(d) shall be payable by the Company to the
Executive and his contingent annuitant, if any, or to the Executive's
Surviving Spouse as a spouse's benefit if the Executive dies prior to
commencement of benefits under this Agreement, in the same manner and for
the same period as his pension benefits under the Supplemental Plan and
shall be adjusted actuarially to reflect payment in a form other than a
straight life annuity. Benefits hereunder which commence prior to age 60
shall be actuarially reduced to reflect early commencement to the extent,
if any, provided in the Retirement Plan as if the Executive's Termination
Date were an Early Retirement Date. All capitalized terms used in this
Section 2(d) shall have the same meaning as in the Retirement Plan as in
effect on the date hereof, unless otherwise defined herein or otherwise
required by the context."
IN WITNESS WHEREOF, the Company has caused this Amendment to Severance
Agreement to be signed by its officer thereunto duly authorized and its seal to
be hereunto affixed and attested and the Executive has hereunto set his hand as
of the 22nd day of March, 1996.
AMERICAN BRANDS, INC.
By Xxxxxx X. Xxxxxxxxxx
------------------------
SRVP Chief Administrative Officer
(Corporate Seal)
ATTEST:
Xxxxx X. Xxxxxxx, Xx.
------------------------
Secretary
Xxxxxxx X. XxXxxx
------------------------
Xxxxxxx X. XxXxxx
