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EXHIBIT 10.5
WAGE CONTINUATION AGREEMENT OF
THE HAWK GROUP OF COMPANIES, INC.
THIS AGREEMENT is made and entered into as of this 30th day of June,
1995, by and between The Hawk Group of Companies, Inc., a Delaware corporation
(hereinafter referred to as the "Corporation"), and Xxxxxx X. Xxxxxxxx,
individually (hereinafter referred to as the Employee").
WHEREAS, the Employee is employed by the Corporation;
WHEREAS, the Corporation recognizes the valuable services heretofore
performed for it by the Employee and wishes to encourage his continued
employment by providing this additional compensation for the Employee's services
to the Corporation;
WHEREAS, the Employee has no present intention to retire;
WHEREAS, the Employee wishes to be assured that the spouse of the
Employee at the time of his death (the "Spouse") will be entitled to a certain
minimum amount of compensation for the lifetime of the Spouse after his death;
and
WHEREAS, the parties hereto wish to provide the terms and conditions
upon which the Corporation shall pay such additional compensation to the Spouse
after the Employee's death;
NOW THEREFORE, in consideration of the premises and of the mutual
promises herein contained, the parties hereto agree as follows:
1. CONSIDERATION.
(a) In consideration of the Employee remaining in its employ, the
Corporation agrees that, in the event of death of the Employee (i) while the
Employee is in the active employ of the Corporation or (ii) while the Employee
is no longer in the active employ of the Corporation solely because the Employee
is mentally or physically disabled, the Corporation shall pay to the Spouse a
wage continuation payment. The "wage continuation payment" shall be an amount
equal
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to 50 percent of the Employee's salary, but in no event less than 50 percent of
the Employee's average salary in the two calendar years preceding (i) the
Employee's death (in the event of death while the Employee is in the active
employ of the Corporation) or (ii) the Employee becoming mentally or physically
disabled (in the event of death while the Employee is no longer in the active
employ of the Corporation solely because the Employee is mentally or physically
disabled). The phrase "mentally or physically disabled" shall have the meaning
ascribed to it in the Employment Agreement entered into between the Corporation
and the Employee on June 30, 1995. The term "salary" shall mean Form W-2 salary
from the Corporation subject to income tax other than any bonuses and benefits
paid to the Employee. The amount shall be payable to the Spouse in equal monthly
installments commencing with the first day of the first month following the
month of the Employee's death and shall continue monthly until the death of the
Spouse.
(b) In the event that, upon the death of the Employee, the Spouse is
not then living, the Corporation shall not be obligated to make any payments
hereunder, and neither the Employee's estate, his heirs or his other
beneficiaries shall have any claim thereto.
2. TERMINATION. In the event that the employment of the Employee by the
Corporation is terminated for any reason other than his (i) death or (ii) the
Employee becoming mentally or physically disabled, this Agreement shall
thereupon terminate, and the Corporation shall have no further obligation
hereunder. Nothing contained herein shall be construed to be a contract of
employment for any term of years, nor as conferring upon the Employee the right
to continue in the employ of the Corporation in any capacity. It is expressly
understood by the parties thereto that this Agreement relates exclusively to
salary continuation benefits in return for the Employee's services and is not
intended to be an employment contract.
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3. PAYMENT. Nothing contained in the Agreement and no action taken
pursuant to its provisions by either party hereto shall create, or be construed
to create, a trust of any kind, or a fiduciary relationship between the
Corporation and the Employee or the Spouse. The payments to the Spouse shall be
made from assets which shall continue, for all purposes, to be a part of the
general assets of the Corporation, and no person, other than the Corporation,
shall have, by virtue of the provisions of the Agreement, any interest in such
assets. To the extent that any person acquires a right to receive payments from
the Corporation under the provisions hereof, such right shall be no greater than
the right of any unsecured general creditor of the Corporation.
4. INSURANCE. In the event that, in its discretion, the Corporation
purchases an insurance policy or policies insuring the life of the Employee to
allow the Corporation to recover, in whole, or in part, the cost of providing
the benefits hereunder, neither the Employee nor the Spouse shall have any
rights whatsoever therein; the Corporation shall be the sole owner and
beneficiary thereof and shall possess and may exercise all incidents of
ownership therein.
5. PROHIBITIONS. Neither the Employee nor the Spouse shall have any
power or right to transfer, assign, anticipate, hypothecate or otherwise
encumber any part or all of the amounts payable under, nor shall such amounts be
subject to seizure by any creditor of any such beneficiary, by a preceding by
law or in equity, and no such benefit shall be transferable by operation of law
in the event of bankruptcy, insolvency or death of the Employee or the Spouse.
Any such attempted assignment or transfer shall be void and shall terminate this
Agreement, and the Corporation shall thereupon have no further liability
hereunder.
6. AMENDMENT. This Agreement may not be amended, altered or modified,
except by a written instrument signed by the parties hereto, or their respective
successors or assigns, and may not be otherwise terminated except as provided
herein.
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7. BINDING. This Agreement shall be binding upon and inure to the
benefit of the Corporation and its successors and assigns, and the Employee and
his successors, assigns, heirs, executors, administrators and the Spouse.
8. NOTICE. Any notice, consent or demand required or permitted to be
given under the provisions of the Agreement shall be in writing, and shall be
signed by the party giving or making the same. If such notice, consent or demand
is mailed to a party hereto, it shall be sent by United States certified mail,
postage prepaid, addressed to such party's last address as shown on the records
of the Corporation.
9. CONSTRUCTION. This Agreement, and the rights of the parties
hereunder, shall be governed by and construed in accordance with the laws of the
State of Ohio.
10. INTEGRATION. This Agreement supersedes all prior arrangements,
understandings, conversations and negotiations between the parties with respect
to the subject matter of this Agreement and shall constitute the entire
agreement between the parties with respect to such matter..
IN WITNESS WHEREOF, the parties hereto have executed this Agreement, in
duplicate, as of the day of the first above written.
ATTESTED TO: THE HAWK GROUP OF COMPANIES, INC.
By: /s/Xxxxx X. Xxxxxx By:/s/Xxxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxx Xxxxxx X. Xxxxxxx
Secretary President and Chief Executive Officer
/s/Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx, Employee
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