EXHIBIT 10(g)
RETIREMENT AGREEMENT
AGREEMENT made June 5, 1997 between Stanhome Inc., a Massachusetts
corporation with its principal place of business at 000 Xxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxxxxxx (the "Company") and Xx. Xxxxx X. Xxxxx of 00
Xxxxxxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000 ("Xxxxx").
NOW, THEREFORE, in consideration of the mutual agreements hereinafter
contained, the parties agree as follows:
l. Normal Retirement.
(a) Subject to the provisions of paragraph 9 below, if Xxxxx retires
or his employment is involuntarily terminated on or after May 12, 2011, the
Company will pay him each month for the duration of his life deferred
compensation equal to 1/12 of (i) 50% of the average annual compensation
received by him in the 5 most highly compensated years of his final l0
years of employment, as determined under paragraph 5 below, less (ii) 50%
of his annual Primary Social Security Benefit, as hereinafter defined.
(b) The monthly benefit determined under subparagraph (a) above
shall be reduced by the value of the monthly retirement benefit, in the
form of a life annuity payable for Xxxxx'x life, which Xxxxx is entitled to
receive from any other qualified or non-qualified plan maintained by the
Company (excluding (i) the portion, if any, of such benefit based on
Xxxxx'x contributions to such plan, and (ii) employer contributions to any
40l(k) Plan) commencing at such time as Xxxxx first becomes eligible to
receive such benefit; provided, however, that any such reduction
attributable to the Stanhome Inc. Pension Plan (the "Pension Plan") shall
be in an amount such that Employee and his spouse, if she survives him,
will each receive no less benefit under this Contract and the Pension Plan
in combination than he or she would have received under the Pension Plan.
For purposes hereof, the value of the monthly retirement benefit of
any amount which Xxxxx is entitled to receive from a defined contribution
plan based on the Company's contributions thereto shall be determined as of
the time of Xxxxx'x termination by reference to the annuity table set forth
in Exhibit A attached. It is recognized by the parties that prior to
Employee's termination there may be changes of sufficient importance in one
or more of the assumptions upon which this table is based to make
appropriate the use of an alternative table. In such case, Stanhome may
substitute an alternative table but only upon the written recommendation of
an independent nationally recognized firm of compensation consultants, as
may be selected by it, and after written notice to the Employee.
(c) The benefit otherwise calculated under this paragraph 1 shall be
reduced as provided in subsection (a), (b), or (c) of Exhibit A of the
Stanhome Inc. Pension Plan (as currently in effect), depending on the
option chosen by Xxxxx.
2. Early Retirement. Subject to the provisions of subparagraph 2(c)
and paragraph 9 below:
(a) If Xxxxx'x employment terminates voluntarily on or after May 12,
2001 and before May 12, 2011, the Company will pay him each month for the
duration of his life the benefit which would be payable if the provisions
of paragraph l above were applied as of the date of such termination,
provided that the portion of the benefit determined under paragraph l(a)
shall be reduced by the following percentages based on Xxxxx'x age at his
termination date (to be adjusted on a daily pro-rata basis if Xxxxx retires
on a day other than his birthday):
Age at Termination Percentage
62-64 0%
6l 2%
60 4%
59 9%
58 14%
57 19%
56 24%
55 29%
(b) If Xxxxx'x employment terminates involuntarily before May 12,
2011 for any reason other than cause, he shall be entitled to receive the
benefit determined under subparagraph 2(a) as if his age on such
termination were his actual age on the date of his termination plus five
years, but such benefit shall not be payable until his actual fifty-fifth
(55th) birthday.
(c) If Xxxxx'x employment terminates by reason of discharge for
cause, neither he nor his wife shall be entitled to receive payment of any
kind under this agreement; "cause" hereunder shall mean dishonesty,
misconduct, insubordination or any activity which would cause a forfeiture
of rights under paragraph 9 below if it occurred following termination of
employment.
3. Disability.
In the event Xxxxx becomes disabled after reaching age 55 but
while still employed by the Company, he shall receive, commencing with the
month following the commencement of his disability, a monthly amount
determined under paragraph l that would have been payable to him if he had
remained employed until retirement at age 65 at the annual rate of
compensation in effect at the time of his disability, provided that the
amount payable hereunder shall be reduced by the monthly value of any
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benefit paid to Xxxxx under a sick leave policy or long-term disability
income plan maintained by the Company for so long as such benefits remain
payable.
For purposes hereof, Xxxxx shall be deemed to be disabled when he is
rendered incapable of performing the work for which he was employed by a
medically determinable physical or mental condition which is likely to
result in death or to be of long-continued and indefinite duration.
4. Survivors Benefit.
(a) In the event that Xxxxx dies while employed by the Company prior
to reaching age fifty-five (55), or in the event that Xxxxx'x employment by
the Company is involuntarily terminated prior to age fifty-five (55) for
any reason other than cause, and he dies subsequent to such termination,
the Company will pay his surviving spouse, subject to subparagraph (d)
below, commencing on the date that Xxxxx would have been fifty-five (55)
had he lived, a monthly amount for the remainder of her life equal to fifty
percent (50%) of the benefit which would have been paid to Xxxxx commencing
on his fifty-fifth (55th) birthday pursuant to subparagraph 2(b).
(b) In the event that Xxxxx dies after age fifty-five (55) while
still employed by the Company, the Company will pay his surviving spouse,
subject to subparagraph (d) below, a monthly amount for the remainder of
her life equal to fifty percent (50%) of the monthly benefit that would
have been paid to Xxxxx under paragraph 1 or subparagraph 2(a), whichever
is applicable, had he retired on the day immediately prior to the date of
his death.
(c) In the event that Xxxxx'x employment by the Company terminates
after age fifty-five (55) and he subsequently dies while receiving payments
hereunder, the Company will pay his surviving spouse, subject to
subparagraph (d) below, a monthly amount for the remainder of her life
based upon the form of pension elected by Xxxxx under Article 6.2 (as
currently in effect) of the Stanhome Inc. Pension Plan. In the event Xxxxx
was disabled and had been receiving a benefit under paragraph 3, the
surviving spouse shall be entitled to receive fifty percent (50%) of the
benefit payable under paragraph 3 without reduction thereunder for any
benefits being paid to Xxxxx under a sick leave policy or a long-term
disability income plan maintained by the Company except to the extent such
benefits remain payable to such spouse following Xxxxx'x death.
(d) No amounts shall be paid a surviving spouse under subparagraph
(a), (b) or (c) above unless she shall have survived Xxxxx for a period of
30 days and shall have been married to him throughout the l year period
ending on Xxxxx'x date of death. Xxxxx may, by written notice to the
Company, and with the Company's consent which will not be unreasonably
withheld, substitute a trust for the benefit of his surviving spouse as
the recipient entitled to payments otherwise payable to his surviving
spouse under this Agreement, but in such case the foregoing limitations
shall continue to apply.
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(e) If the sum of $20,000 exceeds the total amount paid to the
surviving spouse at time of her death, such excess shall be paid to a
beneficiary to be designated by Xxxxx, or in the absence of his
designation, by his surviving spouse, in writing to the Company, provided
that in the event no beneficiary has been designated or the designated
beneficiary does not survive such spouse for a period of 30 days, such
excess shall be paid to the personal representative of the surviving
spouse.
5. Annual Compensation. For purposes hereof, Xxxxx will be deemed
to have been employed for the entire calendar month during which his
employment terminates and his annual compensation shall be measured on the
basis of twelve month periods ending with the last day of such month.
"Compensation" for purposes hereunder shall be the total earnings
paid in cash to Xxxxx by the Company and properly reportable on IRS Form W-
2, including base pay, bonuses, car and financial planning allowances, but
not including Company contributions under any group life insurance or other
qualified or non-qualified employee retirement or benefit plan or any
payment designated by the Company as an allowance for Xxxxx'x business
expenses. Compensation shall not be reduced by the amount of any elective
contributions by Xxxxx under any 40l(k), Flexible Spending Account or Group
Medical Insurance plan of the Company. Management Incentive Plan bonuses
which are normally awarded in the first half of March of each year if the
Plan criteria are met, shall be deemed to have been received, whether or
not payment is deferred, in the calendar year with respect to which such
bonus is earned, allocated thereto on a monthly basis. Other compensation
whose receipt is deferred by Xxxxx shall be deemed to have been received
for the purposes hereof at the time such compensation would have been
received, if there had been no such deferral.
In the event Xxxxx'x compensation for the last twelve-month period
cannot be determined by the time the first payment becomes due hereunder,
e.g., due to a bonus payable on the results of the Company's operations for
a year in which Xxxxx retires prior to the end of such year, then the first
payments due hereunder shall be based on the estimated amount that Xxxxx
will be entitled to actually receive. The exact amount due Xxxxx shall be
determined as soon as practicable, provided that following such
determination and corresponding adjustment in the monthly payment to Xxxxx
the Company shall pay Xxxxx an additional lump sum to adjust for any
underpayment to Xxxxx and Xxxxx shall refund to Company any overpayment.
6. Primary Social Security Benefit. An Employee's Primary Social
Security Benefit shall be determined on the day prior to the date on which
Xxxxx'x employment with the Company terminates and shall be equal to the
estimated old age retirement benefit Xxxxx will be entitled to receive
under the federal Social Security Act at age 65 (or if different by law
such other age as may then entitle a person to receive his social security
retirement benefits based on his unreduced "primary insurance amount" under
the Social Security Act as then in effect) based on his earnings up to the
day preceding his termination date.
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7. Payment. (a) Amounts payable under the above paragraphs
will be paid on or about the end of the month to which the payment relates.
Payment will be made for the full month in which Xxxxx'x death occurs.
(b) Notwithstanding any otherwise applicable provision
of this agreement to the contrary, the retirement benefits due to Xxxxx (or
his beneficiary) under this Agreement, if any, shall be paid in a lump sum
upon the occurrence of (i) a termination of Xxxxx'x employment under
circumstances that entitle Xxxxx to payment of a severance benefit under
Paragraph 1 of the "Change in Control Agreement" dated January 1, 1992
between the Company and Xxxxx (or, if at the time of such termination the
Change in Control Agreement is no longer in effect, under circumstances
that would entitle Xxxxx to such payment if such Agreement were in effect),
or (ii) a Change in Control (as defined in the Change in Control Agreement)
at any time following Xxxxx'x termination of employment from the Company.
Such lump-sum payment shall be the present value of the benefit payable to
Xxxxx hereunder using the Pension Benefit Guaranty Corporation immediate
annuity interest rate as is in effect for the month in which the payment is
made and the mortality table based on the UP-1984 Table, all as in
accordance with generally acceptable actuarial principles.
8. Confidential Information, Covenant Not to Compete and Non-
Solicitation.
(a) Xxxxx agrees that he will not use or disclose to anyone (other
than for the benefit of the Company) either during the term of his
employment or at any time thereafter, any Confidential Information obtained
by him or made known to him while employed by the Company, and will make
all reasonable, necessary and appropriate efforts to safeguard all such
Confidential Information from disclosure to anyone other than as permitted
hereby. As used herein "Confidential Information" includes, but is not
limited to, trade secrets, business and sales policies, methods, plans and
customer lists, including any lists written or other of such persons or
entities, whether of the Company or any other organization associated or
affiliated with or owned by or owning the Company, but shall not include
information which becomes generally available to the public other than as a
result of disclosure by Xxxxx'x act or default or the acts or default of
Xxxxx'x agents or representatives.
(b) Provided the Company is making the payments to Xxxxx as required
pursuant to this Agreement following his termination of employment, Xxxxx
agrees that he will not during his life, either alone or in conjunction
with any individual, firm, corporation, association or other entity (except
for the benefit of the Company), either as principal, agent, officer,
employee, director, investor, consultant, shareholder, associate or in any
other capacity whatsoever:
(i) carry on, participate in, or be engaged in, concerned with,
or interested in, directly or indirectly, any undertaking which
is in whole or in part competitive with any of the businesses
carried on by the Company within the respective territories in
which such businesses are then carried on (except for any equity
share investment in a public company whose shares are listed on a
recognized stock exchange where such share investment does not in
the
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aggregate exceed 5% of the issued equity shares of such company);
(ii) attempt to solicit any suppliers, customers, employees or
independent dealers away from the Company;
(iii) carry on, participate in, or be engaged in, concerned
with, or interested in, directly or indirectly, any undertaking
which bears any name similar to that of the Company; or
(iv) take any act as a result of which the relations between
the Company and its suppliers, customers, employees or others may be
impaired or which may otherwise be detrimental to the business of
the Company.
Competition shall be deemed to include (i) any dealings with the Company's
employees or independent dealers, and (ii) the use in any way of the
Company's customer or mailing lists. The reference to Company in this
Paragraph 8 shall include all subsidiaries and affiliated entities of the
Company. Xxxxx agrees that the remedy at law for breach by him of the
foregoing covenant will be inadequate and that the Company shall be
entitled to injunctive relief.
(c) Xxxxx'x obligations under the foregoing subparagraphs of this
paragraph 8 shall continue notwithstanding the termination of his rights to
receive any payments hereunder.
9. Forfeiture of Payments. The Company may discontinue payments
hereunder and have no further liability under this agreement in the event
that Xxxxx fails to observe any of the terms of this agreement, provided,
however, that if his failure to observe is limited to the terms of
subparagraph 8(b) above and is his first failure, the Company shall give
him written notice thereof and if, within l5 days of such notice, Xxxxx
gives the Company written notice of his discontinuance of the activity
complained of, payments hereunder shall be reinstituted.
10. Assignment. Neither Xxxxx nor his wife shall have any right to
commute, encumber, or dispose of the right to receive payments hereunder,
which payments and the right thereto are expressly declared to be
nonassignable and nontransferable, except as provided in Paragraph 4(d).
All rights under this agreement are merely unsecured contractual
rights of Xxxxx or Xxxxx'x spouse against the Company. Xxxxx and Xxxxx'x
spouse are unsecured general creditors of the Company. The Company agrees
to set aside certain assets in a trust for the payment of benefits under
this agreement. In the event of the insolvency or bankruptcy of the
Company, any assets set aside in such trust shall at all times be subject
to the claims of the Company's general creditors as if such assets were
general assets of the Company.
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11. Binding Effect. This agreement shall be binding upon and inure
to the benefit of any successor of the Company and any such successor shall
be deemed substituted for the Company under the terms of this agreement.
As used in this agreement, the term "successor" shall include any person,
firm, corporation, or other business entity which at any time, whether by
merger, purchase, or otherwise, acquires all or substantially all of the
assets or business of the Company. To the extent any payment required to
be made by the Company under this agreement is instead made by the Trust
created by the Company for that purpose, the Company's obligation under
this agreement will to such extent be deemed satisfied. If the Trust for
any reason fails to make a payment required to be made by the Company under
this agreement, the Company remains fully liable for such payment under the
terms of the agreement.
12. Not an Employment Agreement. This agreement is not an
employment agreement and the Company reserves the right to discharge Xxxxx
with or without cause. The agreement in no way affects his rights under
the Stanhome Inc. Employees' Profit-Sharing Plans or Pension Plans or under
any Stanhome group or other insurance policy.
13. Notices. Any notice required or permitted to be given under this
agreement shall be sufficient if in writing, and if sent by registered
mail, or delivered, to his residence in the case of Xx. Xxxxx, at 00
Xxxxxxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000, or in the case of the
Company, to its principal office at 000 Xxxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxxxxxxx, Attn: Assistant Secretary. Either party may change the
address to which notices are to be addressed by notice in writing given to
the other in accordance with the terms hereof.
14. Waiver of Breach. The waiver by the Company of a breach of any
provision of this agreement by Xxxxx shall not operate or be construed as a
waiver of any subsequent breach by Xxxxx.
15. Governing Law. This agreement shall be deemed made in the
Commonwealth of Massachusetts, and its form, execution, validity,
construction and performance shall be construed in accordance with the laws
of said Commonwealth.
16. Entire Agreement. This agreement constitutes the entire agreement
of the parties. It may not be changed orally but only by an agreement in
writing signed by Xxxxx and for the Company by an officer duly authorized
by the Company's Board of Directors.
17. Severability. In the event that any of the terms or provisions of
this agreement or any portion of such terms or provisions shall be
determined to be invalid or inoperative, such determination shall not
affect the efficacy of the balance of the agreement and any such invalid or
inoperative term or provision shall be deemed severable.
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IN WITNESS WHEREOF, the parties have executed this Agreement.
ATTEST: STANHOME INC.
/s/Xxxx X. Xxxxx BY:/s/G.Xxxxxxx Xxxxxxxxx
Xxxx X. Xxxxx G. Xxxxxxx Xxxxxxxxx
Assistant Secretary President and CEO
/s/Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
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EXHIBIT "A"
Life Annuity Value
Age Value of $1. payable annually
for life, with first payment
Male Female at age shown on left
49 55 11.7932
50 56 11.6405
51 57 11.4831
52 ` 58 11.3209
53 59 11.1537
54 60 10.9814
55 61 10.8037
56 62 10.6203
57 63 10.4301
58 64 10.2325
59 65 10.0274
60 66 9.8156
61 67 9.5977
62 68 9.3737
63 69 9.1434
64 70 8.9066
65 71 8.6649
66 72 8.4198
67 73 8.1739
68 74 7.9286
69 75 7.6846
70 76 7.4421
