Exhibit 10.27
AQUAPENN SPRING WATER COMPANY
NON-QUALIFIED DEFERRED COMPENSATION AGREEMENT
THIS AGREEMENT made this 1st day of October, 1994 by and between
AquaPenn Spring Water Company, a Pennsylvania Business Corporation with its
principal office in State College, Pennsylvania ("Corporation")
AND
XXXXXX X. XXXXX, III, an individual of State College, Pennsylvania
("Employee").
BACKGROUND
A. Corporation employs Employee, and Employee serves Corporation in
such capacity as Corporation may designate from time to time.
B. Employee currently devotes all of his time, attention, skill and
efforts to the performance of duties on behalf of Corporation.
C. Pursuant to the terms of an Employment Agreement entered into on
even date herewith, Corporation has agreed to provide a non-qualified deferred
compensation benefit to Employee.
NOW THEREFORE, in consideration of the foregoing, and intending to be
legally bound, the parties agree as follows:
1. Definitions. Certain terms shall be defined in this Agreement as
follows:
a. "Agreement" means this Non-qualified Deferred Compensation
Agreement.
b. "Beneficiary" means the person, persons, estate or trust
which Employee shall designate from time to time to receive either: (i) the
pre-retirement death benefit payable hereunder in the event of Employee's death
prior to retirement; or (ii) the balance of the retirement benefit payable
hereunder in the event of Employee's death following his retirement from
Corporation.
d. "Board" means the Board of Directors of Corporation.
e. "Compensation" means the salary, received by Employee from
Corporation, as to which Corporation is required to withhold federal income
taxes, under applicable federal income tax laws.
f. "Deferred Compensation Account" means the separate book
reserve maintained by Corporation for amounts that are credited to Employee
hereunder.
g. "Effective Date" means December 15, 1994.
h. "Plan Year" means the twelve (12) month period used by
Corporation from time to time for tax reporting purposes.
2. Deferred Compensation Account. Corporation shall credit to the
Deferred Compensation Account established for Employee an amount equal to
fifteen (15%) percent of Employee's Compensation for each Plan Year. In
addition, Corporation shall credit the Deferred Compensation Account with an
amount each Plan Year representing earnings on amounts previously credited to
the Deferred Compensation Account ("Earnings"). Earnings credited to the
Deferred Compensation Account shall be based on the actual investment experience
of Corporation on funds it may hold for investment for the purpose of meeting
its obligations hereunder. Provided, however, that if the Corporation invests in
life insurance contracts as a means of meeting its obligations hereunder, the
Deferred Compensation Account for Employee shall not be adjusted for any
surrender or liquidation charges on such life insurance contracts.
3. Vesting. Employee shall vest in the benefit payable under Paragraph
4 of this Agreement in accordance with the following table:
Date of Termination Vested Portion of Deferred
of Employment Compensation Account
Before 12/31/94 40 %
1/1/95 to 12/31/95 50 %
1/1/96 to 12/31/96 60 %
1/1/97 to 12/31/97 70 %
1/1/98 to 12/31/98 80 %
1/1/99 to 12/31/99 90 %
1/1/2000 and following 100 %
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4. Termination of Employment of Employee. In the event of Employee's
termination of employment, Corporation shall distribute to Employee, on the
first day of the next succeeding five (5) Plan Years following Employee's
termination of employment an amount equal to the applicable percentage of the
vested portion of Employee's Deferred Compensation Account determined by
reference to the following table:
Plan Year Following Termination Applicable Percentage
of Employment
First 20 %
Second 25 %
Third 33 %
Fourth 50 %
Fifth 100 %
5. Disability of Employee. In the event Employee's employment by
Corporation is terminated due to disability, the vesting schedule set forth in
Paragraph 3 hereof shall not apply and Employee shall be 100% vested in the
Deferred Compensation Account. For purposes of this agreement, disability shall
mean Employee's inability to discharge substantially all his duties of
employment because of illness or incapacity as determined by a physician
mutually agreeable to Employee and Corporation.
6. Death Benefits.
a. Pre-Retirement. In the event Employee's employment by
Corporation is terminated due to Employee's death, Employee's Beneficiary shall
be entitled to receive a death benefit equal to the value of Employee's Deferred
Compensation Account. Such death benefit shall be paid in a lump sum to
Employee's beneficiary within one hundred twenty (120) days of Employee's death.
b. Post-Retirement. In the event Employee dies after benefits
have commenced to be paid under Paragraph 4 hereof, the remainder of such
payments shall be paid to Employee's Beneficiary at the same time as such
payments would have been paid to Employee had he survived.
7. No Assignment. Neither Employee nor Employee's Beneficiary or
personal representative shall have any right to commute, sell, assign, transfer,
encumber or otherwise dispose of the right to receive payments hereunder, which
payments and the right thereto are expressly declared to be nonassignable and
nontransferable. Any attempted assignment or transfer by Employee or Employee's
Beneficiary or personal representative shall be of no effect. Corporation shall
have the right to assign this Agreement and to transfer its obligations
hereunder.
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8. No Employment Guarantee. Nothing contained in this Agreement shall
be construed as conferring upon Employee the right to continue in the employment
of Corporation.
9. Authority of Board. The Board shall have the full power and
authority to interpret, construe and administer this Agreement. The Board's
interpretations and construction hereof and actions hereunder, including any
valuation of a Deferred Compensation Account, or the amount(s) to be paid
therefrom, shall be binding and conclusive on all persons for all purposes. No
member of the Board shall be liable to any person for any action taken or
omitted in connection with the interpretation or administration of this
Agreement unless attributable to his/her own willful misconduct or lack of good
faith.
10. Liability of the Corporation. Nothing contained in this Agreement
shall constitute the creation of a trust or other fiduciary relationship between
Corporation and Employee or between Corporation and the Beneficiary or any other
person. Corporation shall not be considered a trustee by reason of the existence
of this Agreement.
11. Funding; Assets. Corporation reserves the absolute right in its
sole and exclusive discretion either to fund the obligations of Corporation
undertaken by this Agreement or to refrain from funding the same, and to
determine the extent, nature and method of such funding. Should Corporation
elect to fund this Agreement, in whole or in part, through life insurance or
annuity contracts, or both, Corporation shall be the owner and beneficiary of
each such policy. Corporation reserves the absolute right, in its sole
discretion, to terminate any such contract, as well as any other funding
program, at any time, either in whole or in part. Title to, and beneficial
ownership of, any assets which Corporation may earmark to pay the benefits
hereunder shall at all times remain in Corporation. Employee and Employee's
Beneficiary or personal representative shall not have any property interest
whatsoever in any specific assets of Corporation. Nothing set forth in this
Agreement shall cause such assets to be treated as anything but the general
assets of Corporation.
12. Insurance Policies. Employee understands that Corporation may make
application to purchase a life insurance policy or policies on his life, which
will be owned by Corporation and under which it will be the sole beneficiary.
Employee agrees to provide Company with such information as it may require in
order to make such application and to cooperate fully with Corporation in
respect of such application, including the taking of a physical examination if
requested to do so. In the event the insurance company to which application is
made declines to issue the policy at standard premium rates, this Agreement will
be void unless Corporation decides otherwise. Similarly, if Employee should die
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while employed and the proceeds of the policy on Employee's life are not paid to
Corporation because the information Employee has furnished in connection with
the application is materially false or Employee's death was caused by suicide
within two (2) years of the date on any policy on Employee's life is issued,
Corporation will be under no obligation to pay the benefits herein provided.
13. Claims Procedure. In the event that benefits under this Agreement
are not paid to Employee, and Employee feels entitled to receive them, a claim
shall be made in writing to the administrator within sixty (60) days from the
date payments are not made. Such claim shall be reviewed by the administrator.
If the claim is denied, in full or in part, the administrator shall provide a
written notice within ninety (90) days setting forth the specific reasons for
denial, specific reference to the provisions of this Agreement upon which the
denial is based, and any additional material or information necessary to perfect
the claim, if any. Also, such written notice shall indicate the steps to be
taken if a review of the denial is desired.
If a claim is denied and a review is desired, Employee shall notify the
administrator in writing within sixty (60) days (and a claim shall be deemed
denied if the Administrator does not take any action within the aforesaid ninety
(90) day period). In requesting review, Employee may review this Plan or any
documents relating to it and submit any written issues and comments Employee may
feel appropriate. In its sole discretion, the Administrator shall then review
the claim and provide a written decision within sixty (60) days. This decision
likewise shall state the specific reasons for the decision and shall include
specific reference to specific provisions of this Plan on which the decision is
based.
14. Plan Administrator. For purposes of implementing the claims
procedure contained in Paragraph 13 (but not for any other purpose), the Board
is hereby designated as the Named Fiduciary and Administrator of this Agreement.
15. Governing Law. This Agreement shall be governed by the laws of the
Commonwealth of Pennsylvania.
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IN WITNESS WHEREOF, the Parties have executed this Agreement on the day
and year first above written.
ATTEST: AQUAPENN SPRING WATER COMPANY
/s/signature illegible By: /s/ Xxxxxx X. Xxxxx, III
----------------------------- -------------------------------
, Secretary Xxxxxx X. Xxxxx, III, President
WITNESS: EMPLOYEE:
/s/Xxxxxxxx X. Xxxxxxxxxx /s/ Xxxxxx X. Xxxxx, III
----------------------------- -------------------------------
XXXXXX X. XXXXX, III
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AQUAPENN SPRING WATER COMPANY
Beneficiary Designation
BENEFICIARY DESIGNATION/CHANGE. I, the undersigned,
hereby designate Xxxxx Xxxxxxx Xxxxx
----------------------------
---------------------------------------------
---------------------------------------------
as beneficiary of any benefits payable under the Non-Qualified
Deferred Compensation Agreement between me and AquaPenn Spring
Water Company (the "Agreement") following my death.
The terms of this form are under and subject to all of the provisions
of the Agreement. I acknowledge having received and read a copy of the
Agreement.
WITNESS: EMPLOYEE:
/s/Xxxxxxxx X. Xxxxxxxxxx /s/ Xxxxxx X. Xxxxx
----------------------------- -------------------------------
XXXXXX X. XXXXX, III
Date: 12/7/94
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