Exhibit 10 (cc)
RELEASE AGREEMENT
This Release Agreement is entered into by and between Xxxxxx X.
Xxxxxxxxxxx, a resident of 00 Xxxxxxx, Xxxxxxxx, Xxxxxxxxxxx (hereinafter
referred to as "Associate"), and Enesco Group, Inc., a Massachusetts
corporation having a principal place of business at 000 Xxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxxxxxx (hereinafter referred to as the "Company").
In consideration of the promises, conditions and representations
set forth herein, the severance payments being provided to Associate by the
Company as set forth below, and other good and valuable consideration, the
receipt and sufficiency of which hereby are acknowledged by Associate and
the Company (hereinafter sometimes referred to collectively as the
"Parties"), the Parties hereby agree as follows:
1. Termination Date. Associate's employment with the Company shall
terminate involuntarily without cause as of the close of business on
December 31, 1998 (the "Termination Date").
2. Continuation of Salary and Benefits After Termination. Prior to
the Termination Date, Associate's salary and his participation in all
compensation and benefit plans and programs in which he currently is a
participant or from which he currently receives benefits will remain in
effect on the same terms as are in effect as of the effective date of this
Agreement.
As of the Termination Date, Associate's salary and any other
compensation and benefits he receives from the Company will terminate,
other than compensation and/or benefits to which he continues to be
entitled (a) pursuant to the terms of this Agreement, (b) as a matter of
federal or state law, (c) pursuant to the agreements between the Parties to
this Agreement listed below, including but not limited to a certain
Retirement Agreement entered into between the Parties dated June 5, 1997,
(the "Retirement Agreement"), or (d) pursuant to the terms of the
compensation or benefit plans or programs in which he continues to be a
participant or has a right to receive such compensation or benefits after
the Termination Date listed below.
The agreements and compensation and benefit plans and programs
referred to herein are as follows:
o Medical and Life Employee Group Insurance Plan under Policy
#2232182 issued by Connecticut General Life Insurance Company to
Stanhome Inc.
o Accidental Death and Dismemberment Group Insurance Plan under
policy issued by AIG Insurance Company to Stanhome Inc.
o Retirement Agreement dated June 5, 1997, and related Trust
Agreement dated March 1, 1988, as amended
o Stanhome Pension Plan and related Trust Agreement dated January 1,
1980, as amended
o Stanhome Supplemental Pension Plan and related Trust Agreement
dated January 1, 1995, as amended
o Stanhome Investment Savings Plan and related Trust Agreement dated
January 1, 1993, as amended
o Stanhome Supplemental Investment Savings Plan and related Trust
Agreement dated January 1, 1995, as amended
o Stanhome PAYSOP Plan and related Trust Agreement dated October 15,
1985, as amended
o Stanhome Inc. 1984 Stock Option Plan
o Stanhome Inc. 1991 Stock Option Plan
o Stanhome Inc. 1996 Stock Option Plan
o Management Incentive Plan
o Change in Control Agreement effective January 1, 1992
o Stanhome Matching Gifts Program
With respect to those Company compensation and benefit plans and programs
in which Associate will continue to participate subsequent to the
Termination Date, Associate's participation in such compensation and
benefit plans and programs will be on terms no less favorable than in
effect as of the effective date of this Agreement. Furthermore, the Company
and Associate agree that after his Termination Date he will not become
entitled to any increased benefits under such compensation and benefit
plans and programs, but the benefits payable by the Company to Associate
thereunder shall be based upon his length of service and compensation level
as of the Termination Date.
3. Consideration.
X. Xxxxxxxxx Payments. Following the Termination Date, and for a
period of thirty-six (36) consecutive monthly periods commencing January 1,
1999 and ending on December 31, 2001 (the "Severance Period"), Associate
will receive severance payments equal to $14,875.00 per month. Payment will
be made on the first business day of each such month, commencing January 4,
1999. Such payments, based on Associate's current base salary, are in
addition to anything of value to which Associate is already entitled or
provided pursuant to this Agreement, any other agreement between the
Parties or other Company plan or program. Moreover, such severance payments
are not intended to include any unused, accrued vacation time to which
Associate may be entitled or any other accrued but unpaid compensation or
benefit to which Associate may be entitled under any Company compensation
or benefit plan or program.
B. Stock Options. Upon the Termination Date, the Company will promptly
deliver to Associate appropriate amendments to Associate's Certificates of
Grant relating to the Company's 1991 Stock Option Plan providing that the
options under such plan shall be exercisable by the Associate or his
guardian or legal representative(s) during the three-year period following
termination of employment as to the additional number of shares of the
Company's common stock, par value $.125 per share, which the Associate
would have become entitled to purchase during the three-year period if the
Associate's employment had not terminated.
C. Additional Payments. During the Severance Period, Associate will be
paid an additional $2,233.33 each month of said period at the same time as
he is paid the Severance Payments provided in paragraph 3.A of this
Agreement, which additional payments represent the Associate's present car
allowance ($1,400 per month) plus Associate's present annual $5,000 medical
supplementary bonus and annual $5,000 financial planning bonus converted
for those purposes to a monthly rate ($833.33 per month).
D. Bonus. In the event that the criteria are met for a bonus award to
Associate under the 1998 Management Incentive Plan, Associate will be paid
the bonus by March 15, 1999.
E. Insurance. Associate will continue to be covered by the group
medical insurance coverage as set forth in the Stanhome Group Insurance
Plan booklet dated December, 1994 (the "Plan") under the policy issued by
Connecticut General Life Insurance Company (Policy #2232182) regardless of
the location of Associate's eventual residence within the United States and
regardless of his coverage by any other medical insurance plans. Should the
Plan be terminated in the future, the Company and its successors and
assigns, as applicable, agree to provide Associate with coverage that is
substantially the same as provided in the Plan. Associate's coverage will
cease when he qualifies for Medicare. Dependent coverage will be continued
as to his spouse until Associate's spouse qualifies for Medicare and as to
his other dependents until that dependent reaches age 23. However, if
coverage has not otherwise already ended, then coverage shall end for
Associate's spouse and other dependents when Associate reaches his 71st
birthday or, in the event of Associate's death before he reaches age 71,
the date when Associate would have reached his 71st birthday, it being
intended that coverage for Associate's spouse and other dependents shall
continue until the date when Associate would have reached his 71st
birthday.
During the Severance Period, the Company, its successors and assigns,
will contribute 80% of the cost of the personal and dependent coverage and
Associate will contribute 20% of such cost, which percentages shall be
adjusted as necessary to be the same percentages as may be in effect for
the cost of medical coverage of active employees of the Company and its
successors and assigns. Upon expiration of the Severance Period, the
Associate will contribute monthly 100% of the cost of Associate's personal
and dependent coverage. The continued medical coverage, as set forth in the
Plan, is binding upon and may not be revoked by the Company or any of its
successors or assigns and will continue until coverage ceases as outlined
above provided that Associate has paid the premium. In the event that
Associate fails to pay the premium on time, the Company will pay the full
premium and notify Associate of his failure to make timely payment.
Associate shall have ten (10) days from his receipt of such notice to cure
his failure to pay by repaying to the Company the amount advanced by the
Company on his behalf, and the Company shall not allow his insurance
coverage to be cancelled or to lapse until such ten-day period shall have
expired.
The Company, its successors and assigns, shall continue to provide at
its sole expense the life insurance ($357,000 Death Benefit) and accidental
death and dismemberment employee insurance coverage, as presently in
effect, to the Associate during the Severance Period. The life insurance
benefit of the Associate in excess of the first $50,000 will be purchased
by the Associate and reimbursed by the Company, up to the amount it would
have cost the Company to maintain the coverage under the Company's group
policy. The cost of this coverage will be reported annually during the
severance period on the Associate's Form W-2 as wages.
The Termination Date shall be treated as an event under the
Consolidated Budget Reconciliation Act of 1985 (COBRA), and Associate will
receive COBRA information under separate cover.
F. Outplacement. The Company also will provide Associate with
outplacement services as mutually agreed upon between the Parties, provided
such outplacement services commence within 12 months following the
Termination Date.
G. Moving Expenses. The Company shall reimburse Associate for
relocation expenses in accordance with present Company Relocation
Guidelines issued September, 1996, incurred by Associate within eighteen
months of the Termination Date unless such expenses are reimbursed to
Associate by a new employer, if any.
H. References. The Company will provide references for Associate in
accordance with its policy.
I. Taxes. Applicable taxes on all payments, transfers and other
consideration referred to herein will be the sole responsibility of
Associate, provided that the Company shall deduct applicable federal and
state withholding income taxes on the payments provided herein.
J. Vacation Pay. All accrued and unused vacation pay was paid to
Associate in December 1998.
4. Retirement Agreement and Pension Plans. The Retirement Agreement
between the Parties entered into on June 5, 1997, shall remain in full
force and effect. In addition, Associate's benefits from the Qualified
Pension Plan and Supplemental Pension Plan shall also remain in full force
and effect. It is agreed that Associate's termination for such purposes is
an involuntary termination without cause.
5. Release.
A. From Associate to the Company. In exchange for the compensation
described in Paragraph 2 and other good and valuable consideration,
Associate hereby agrees that he, his representatives, heirs, executors,
administrators, agents, estate, successors and assigns release and forever
discharge the Company and its affiliates and their successors,
predecessors, assigns, directors, shareholders, officers, employees and/or
agents, both individually and in their official capacities with the Company
and/or its affiliates from any and all actions, causes of action, suits,
claims, demands, obligations, costs, judgments, complaints, contracts,
agreements, promises, debts, damages, and liabilities of whatever kind or
nature, at law, in equity or otherwise, whether existing or contingent,
known or unknown, relating to any matter, cause, or thing whatsoever
arising on or prior to the date of this Agreement, including but not
limited to rights or claims relating in any way to Associate's employment
with or his termination of employment from the Company, including but not
limited to claims arising under common law, contract, implied contract,
public policy, tort, personal injury, or any federal, state or local
statute, law, constitution, ordinance, regulation or order, including but
not limited to the Age Discrimination in Employment Act, as amended, 29
U.S.C. Section 621, et seq., Title VII of the Civil Rights Act, The
Americans with Disabilities Act, The Connecticut Human Rights and
Opportunities Law, The Massachusetts Fair Employment Practices Act and/or
any other applicable employment related federal, state or local statute,
law, ordinance, regulation or order; provided, however, that nothing
contained in this Paragraph 5 shall limit Associate's right to enforce the
terms or xxx for breach of (i) this Agreement, any agreement listed in
Paragraph 2 of this Agreement, or any other agreement whatsoever unrelated
to compensation and severance matters between the Parties hereto whether or
not such agreement is listed in Paragraph 2 of this Agreement, (ii) any
compensation or benefit plan or program in which he remains a participant
or beneficiary beyond the Termination Date in accordance with the
provisions of Paragraph 2, or (iii) Associate's right to indemnification as
an officer or director of the Company and/or its affiliates. This release
is intended by Associate to be a general release as to the claims described
herein.
B. From the Company to Associate. In exchange for Associate's release
of the Company and the covenants made by Associate in Paragraph 9 hereof,
the Company hereby agrees that it and its affiliates and subsidiaries, and
their successors, predecessors, assigns, directors, shareholders, officers,
employees and agents, both individually and in their official capacities
with the Company and its affiliates, attorneys, and agents release and
forever discharge Associate, his representatives, heirs, executors,
administrators, agents, attorneys, estate, successors and assigns, from any
and all actions, causes of action, suits, claims, demands, obligations,
costs, judgments, complaints, contracts, agreements, promises, debts,
damages and liabilities of whatever kind or nature, at law, in equity or
otherwise, whether existing or contingent, known or unknown, relating to
any matter, cause, or thing whatsoever arising on or prior to the date of
this Agreement, including but not limited to rights or claims relating in
any way to Associate's employment with or his termination of employment
from the Company (other than those involving fraud, gross negligence and
gross willful misconduct) provided, however, that nothing contained in this
Paragraph 5 shall limit the Company's right to enforce the terms or xxx for
breach of (i) this Agreement, any agreement listed in Paragraph 2 of this
Agreement, or any other agreement whatsoever unrelated to compensation and
severance matters between the Parties hereto whether or not such agreement
is listed in Paragraph 2 of this Agreement, or (ii) any compensation or
benefit plan or program in which he remains a participant or beneficiary
beyond the Termination Date in accordance with the provisions of Paragraph
2. This release is intended by the Company to be a general release as to
the claims described herein.
6. Indemnification. To the extent that Associate is not otherwise
indemnified under a Company by-law or insurance policy, the Company will
indemnify and hold harmless Associate against all liabilities and expenses,
including amounts paid in satisfaction of judgments, in compromise or as
fines and penalties, and counsel fees, reasonably incurred by Associate in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, in which Associate may be involved
or which Associate may be threatened arising out of actions taken by
Associate in his capacity as an officer, director, employee, agent or
representative of the Company or a direct or indirect subsidiary of the
Company or, at the Company's request, another organization, or in any
capacity with any employee benefit plan of the Company, or such a
subsidiary or organization, or in connection with the prosecution of any
action, suit or proceeding, whether civil or criminal, in which Associate
may be acting for or on behalf of the Company, with the exception of
actions by him with respect to which a court of competent jurisdiction
determines that Associate did not act in good faith in the reasonable
belief that his action was in the best interest of the Company, or to the
extent such claim relates to his service with respect to an employee
benefit plan, in the best interests of the participants or beneficiaries of
such employee benefit plan, without regard of the date when such claim is
brought. Expenses, including without limitation counsel fees, reasonably
incurred by Associate in connection with the defense or disposition of any
such action, suit or other proceeding shall be paid from time to time by
the Company in advance of the final disposition thereof upon receipt of an
undertaking by Associate to repay to the Company the amounts previously
advanced if it shall be adjudicated that indemnification for such expenses
is not authorized hereunder.
7. Waiver of Rights and Claims Under the Age Discrimination in
Employment Act, as Amended. Associate has been informed that because he is
over 40 years of age, he has or might have specific rights and/or claims
under the Age Discrimination in Employment Act, as amended. In
consideration for the compensation described hereunder, Associate
specifically waives such rights and/or claims to the extent that such
rights and/or claims arose prior to the date this Agreement was executed.
Associate acknowledges that he has been provided such information or
materials as is required by law in connection with this waiver.
8. Company Files, Documents and Other Property. Associate warrants
that he will return to the Company upon its request all keys or other
items, including all Company files, reports, books, data and documents,
that are in his possession or control and that are the property of the
Company and not his personal files, reports, books, data and documents.
9. Representations.
A. Associate is hereby advised by the Company to consult with an
attorney prior to executing this Agreement.
B. Associate was further advised, when he was presented with this
Agreement on or before December 14, 1998 that he had at least 45 days
within which to consider the Agreement, until the close of business on
January 29, 1999.
C. This Agreement shall be governed by and construed in accordance
with the laws of the Commonwealth of Massachusetts, without giving effect
to the principles of conflicts of law thereof.
D. The terms of this Agreement are contractual in nature and not a
mere recital. Captions herein are inserted for convenience, do not
constitute a part of this Agreement, and shall not be admissible for the
purpose of proving the intent of the parties.
E. Associate represents that he has read this Agreement, fully
understands the terms and conditions of such Agreement, and is knowingly
and voluntarily executing the same without any duress or undue influence.
10. Confidential Information. Associate agrees that he will not use or
disclose to anyone (other than for the benefit of the Company) at any time
hereafter, 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
Associate's act or default or the acts or default of Associate's agents or
representatives.
11. Resignations and Stock Transfers. Upon the Termination Date,
Associate agrees to (i) resign from any position held by him with the
Company or any direct or indirect affiliated company or organization,
including but not limited to positions as an officer, director, committee
member, or any other position, (ii) take any action necessary to transfer
shares of stock held in his name or for his benefit on behalf of the
Company in any direct or indirect affiliate of the Company, as requested by
the Company, to the Company or a designee of the Company, and (iii) take
any action and execute anything as may be necessary to accomplish the
foregoing.
12. Change in Control. Associate's Change in Control Agreement
effective as of January 1, 1992 (the "Change in Control Agreement") shall
remain in effect up to and including the Termination Date, and subsequent
to the Termination Date in the event that an agreement with the Company to
effectuate a Change in Control, as defined in the Change of Control
Agreement, is entered into prior to the Termination Date. It is agreed that
Associate's termination under this Agreement is (i) for reasons other than
those set forth under Paragraphs 1(a) and 1(b) of the Change in Control
Agreement and (ii) at the direction of the person (as defined in Paragraph
4(a)(i) of the Change in Control Agreement) who has entered into such an
agreement with the Company to effectuate such a Change in Control as
described under and subject to said Paragraph 1(b). To the extent that any
payments made to Associate under the Change in Control Agreement are made
for the same purpose as the severance amounts specified above in Paragraphs
3.A and 3.D (without giving effect to the Gross-Up Payment in Paragraph
1(c) of the Change in Control Agreement for these purposes), such Change in
Control payments shall be in substitution for such severance amounts except
to the extent that any bonus shall be due and payable with respect to any
year preceding that in which the Change in Control occurs. To the extent
the amounts specified in Paragraphs 3.A and 3.D are greater than those paid
under the change in Control Agreement, the amount by which such amounts and
benefits in Paragraphs 3.A and 3.D exceed the amounts paid under the Change
in Control Agreement shall be paid in accordance with the terms of this
Agreement. If Associate is paid all amounts due him under the Change in
Control Agreement in the event of a Change in Control, then Associate shall
not be paid any amounts due him under Paragraph 3.C for the remaining term
of this Agreement.
If a Change in Control, as defined in the Change in Control Agreement,
occurs after the Termination Date, the payments to be made to Associate
under Paragraphs 3.A, 3.C and 3.D shall be paid in a lump sum upon the
occurrence of such Change in Control.
If any of the payments and benefits under this Agreement are subject
to the Excise Tax imposed under Section 4999 of the Internal Revenue Code
of 1986, as amended (the "Code") (the "Excise Tax"), such payments and
benefits shall be deemed to be "...other payments or benefits received or
to be received by the Employee in connection with a Change in Control or
the Employee's termination of employment..." under Paragraph 1(c) of the
Change of Control Agreement and the Company shall pay Associate the
Gross-Up Payment as shall be determined in accordance with said Paragraph
1(c) as if it had remained in effect.
Except as provided under this paragraph, all amounts and benefits to
be paid or provided under this Agreement shall be so paid or provided as
set forth herein without regard to the Change in Control Agreement.
13. Binding Effect. This Agreement shall be binding upon and inure to
the benefit of any successor or assigns of the Company, and any such
successor or assign shall be deemed substituted for the Company under the
terms of this Agreement, and as a condition thereof, such successor and
assign shall expressly assume in writing the rights, duties and obligations
of the Company. As used in the Agreement, the term "successor or assign" or
"successors or assigns" shall include any person, firm, corporation, or
other entity which at any time, whether by merger, consolidation, purchase,
or otherwise, acquires all or substantially all of the assets, capital
stock or business of the Company. The rights and obligations of Associate
under this Agreement, including his right to exercise vested stock options,
shall inure to the benefit of, be binding upon, be exercisable by and be
enforceable by Associate's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If
Associate should die while any amount would still be payable to him
hereunder if he had continued to live, all such amounts, unless otherwise
provided herein, shall be paid in accordance with the terms of this
Agreement to his devisee, legatee or other designee or if there is no such
designee, to his estate.
14. Amendment or Modification. This Agreement may not be amended,
modified, altered or changed except upon written consent of the Parties.
15. Severability. The invalidity or unenforceability of any particular
provision of this Agreement shall not affect the other provisions but the
obligation to be fulfilled under such invalid or unenforceable provision
shall automatically be reduced to the limit of validity or enforceability
prescribed by law, and this Agreement shall be construed in all respects as
if such invalid or unenforceable provision were omitted.
16. Validity. If any of the provision of this Agreement are declared
or determined by any court of competent jurisdiction to be illegal, invalid
or inoperative, such determination shall not affect the validity or
efficacy of the remaining parts, terms or provisions of this Agreement and
any such illegal, invalid or inoperative part, term or provision shall be
deemed severable and not to be a part of this Agreement.
17. Waiver. No waiver of any provision of this Agreement shall be
effective unless made in writing and signed by the waiving party. The
waiver of any breach of this Agreement by either party or the failure of
either party to require the performance of any term or obligation of this
Agreement, in whole or in part, in any one instance shall not constitute a
waiver of or prevent any subsequent enforcement of such term or obligation
in another instance or be deemed a waiver of any subsequent breach.
18. Entire Agreement. Associate and the Company agree that this
Agreement contains and constitutes the entire understanding and agreement
between the Parties hereto respecting the terms of Associate's termination
from the Company and supersedes and cancels the Severance Agreement
effective as of June 1, 1992, as well as all previous written or verbal
negotiations, agreements, commitments, and writings in connection with
severance or compensation arrangements, including the Letter Agreement
dated June 16, 1997, between Associate and the Company. This Agreement
expressly does not supersede or cancel the Retirement Agreement, a certain
Change of Control Agreement effective January 1, 1992, any compensation and
benefit agreements, plans and programs listed in Paragraph 2 of this
Agreement or any other agreements whether or not listed in Paragraph 2 of
this Agreement not referred to in the preceding sentence.
19. Execution. This Agreement may be executed in two or more duplicate
counterparts, each of which shall be treated as an original, but all of
which together shall constitute one and the same instrument, and in
pleading or proving any provision of this Agreement it shall not be
necessary to produce more than one such counterpart.
20. Notice. Any notice required under this Agreement shall be in
writing and shall be delivered by certified mail, return receipt requested,
overnight delivery or telecopy to the following addresses:
a. All notices to Associate shall be addressed to him as follows:
Xx. Xxxxxx X. Xxxxxxxxxxx
00 Xxxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
b. All notices to the Company shall be addressed to it as follows:
Xx. Xxxxx X. Xxxxxxxxx
Executive Vice President,
Chief Administrative and Financial Officer
Enesco Group, Inc.
000 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Either Party may change the address to which notices are to be sent by
providing notice in qriting to the other Party in accordance with the terms
hereof.
21. Effective Date. Associate may revoke this Agreement for a period
of seven (7) das following its execution by him, and the Agreement shall
not become effective or enforceable until the date upon which this
revocation period has expired (the "Effective Date"). If the Effective Date
is later than the termination date, all payments that would have been made
prior to such date shall be paid as of the Effective Date.
Executed this 30th day of December, 1998.
/s/Xxxxxx X. Xxxxxxxxxx
-------------------------------------
Xxxxxx X. Xxxxxxxxxxx
ENESCO GROUP, INC.
By:/s/Xxxxx X. Xxxxxxxxx
----------------------------------
Xxxxx X. Xxxxxxxxx
Executive Vice President,
Chief Administrative & Financial Officer
