PENSION AND INSURANCE SERVICES AGREEMENT
This Pension and Insurance Services Agreement is made this first day of
January 1997 by and between Jefferson Smurfit Corporation, a Delaware
corporation ("JSC") and Smurfit Packaging Corporation, a Delaware Corporation
(the "Company").
W I T N E S S E T H:
WHEREAS, commencing on the date hereof, the Company desires to obtain
from JSC, and JSC is willing to provide to the Company, certain pension and
insurance services on behalf of the Company's Pacific Recycling Company, Sequoia
Pacific Systems, Sequoia Pacific Voting Equipment, Smurfit Newsprint Corporation
of California and Smurfit Plastic Packaging, Inc. divisions, in accordance with
the terms and conditions contained herein;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements contained herein, JSC and the Company agree as follows:
l. (a) Beginning on the date hereof, and continuing until this
Agreement is terminated pursuant to Paragraph 4 hereof, JSC, through its Smurfit
Pension and Insurance Services Company division, shall provide or otherwise make
available to the Company, on behalf of the Company's Pacific Recycling Company,
Sequoia Pacific Systems, Sequoia Pacific Voting Equipment, Smurfit Newsprint
Corporation of California and Smurfit Plastic Packaging, Inc. divisions,
payroll, pension and insurance services ("Services") of the type and scope
provided to Jefferson Smurfit Corporation. Notwithstanding the foregoing, the
Services shall not include, and JSC shall not provide to the Company, any
services with respect to employee benefit plans operated as a multi-employer
union plan. The Services shall not include any services related to plan design
or establishment of new plans.
(b) In connection with the Services, administrative and pension fund
investment policy shall be determined by the Administrative Committee of
Jefferson Smurfit Corporation Retirement Plans.
(c) The Company shall formally appoint the Administrative Committee of
Jefferson Smurfit Corporation Retirement Plans as Plan Administrator of the
Company's pension and 401(k) plans.
2. (a) Subject to Paragraphs 2 (c) and 2 (d) hereof,in consideration
for the Services provided by JSC to the Company pursuant to this Agreement:
(l) (i) The Company shall pay to JSC a fee of $25,730 for the Services
on behalf of the Company's Pacific Recycling Company division for the period
beginning on the date hereof and ending on December 31, 1997 and thereafter an
annual fee as negotiated pursuant to Paragraph 2(d), in each case payable as
provided in paragraph 2(b) hereof.
(ii) The Company shall pay to JSC a fee of $86,560 for the Services on
behalf of the Company's Sequoia Pacific Systems division for the period
beginning on the date hereof and ending on December 31, 1997 and thereafter an
annual fee as negotiated pursuant to Paragraph 2(d), in each case payable as
provided in paragraph 2(b) hereof.
(iii) The Company shall pay to JSC a fee of $6,480 for the Services on
behalf of the Company's Sequoia Pacific Voting Equipment division for the period
beginning on the date hereof and ending on December 31, 1997 and thereafter an
annual fee as negotiated pursuant to Paragraph 2(d), in each case payable as
provided in paragraph 2(b) hereof.
(iv) The Company shall pay to JSC a fee of $102,770 for the Services on
behalf of the Company's Smurfit Newsprint Corporation of California division for
the period beginning on the date hereof and ending on December 31, 1997 and
thereafter an annual fee as negotiated pursuant to Paragraph 2(d), in each case
payable as provided in paragraph 2(b) hereof.
(v) The Company shall pay to JSC a fee of $118,930 for the Services on
behalf of the Company's Smurfit Plastic Packaging, Inc. division for the period
beginning on the date hereof and ending on December 31, 1997 and thereafter an
annual fee as negotiated pursuant to Paragraph 2(d), in each case payable as
provided in paragraph 2(b) hereof.
(2) The Company shall pay third parties for services incurred,
including but not limited to, administrative, consulting and actuarial
services. Additionally, the Company will be responsible for and shall
timely make actuarially determined pension contributions.
(3) The Company shall reimburse JSC for all costs paid for the benefit
of the Company under insurance policies, and for travel and entertainment
expenses incurred in providing the Services to the Company as provided in
Paragraph 2(b) hereof.
(b) The fees provided in Paragraph 2(a) (1) hereof shall be
payable by the Company to JSC on a quarterly basis within 30 days after the
beginning of the quarter to which such payment is attributable. The Company
shall reimburse JSC for insurance premiums and for travel and entertainment
expenses as provided in Paragraph (2) (a) (3) hereof from time to time upon
receipt by the Company from JSC of an invoice setting forth in reasonable detail
such fees and premiums, or of such documents or receipts substantiating such
travel and entertainment expenses; as the case may be.
(c) In addition to the fees and reimbursements payable by the Company
to JSC pursuant to Paragraph 2(a) hereof, in the event that at any time during
the term of this Agreement the performance by JSC of its obligations hereunder
requires unusual additional expenditures, including time by JSC personnel, and
for services rendered by third parties, JSC shall be entitled to charge an
additional fee to the Company as shall be reasonable and appropriate in light of
all factors relevant to adequately compensating JSC for providing the Services.
(d) The annual fees payable by the Company to JSC pursuant to Paragraph
2(a) hereof shall be revised on January 1, l998 and annually thereafter, (i) as
shall be reasonable and appropriate in light of all factors then existing and
relevant with respect to adequately compensating JSC for the Services and (ii)
as agreed by the parties hereto.
3. The term of this Agreement shall commence on the date hereof and
continue until
December 31, 1997, and shall automatically renew from year to year thereafter
until terminated by either party; provided, however, that each of the Company
and JSC may terminate this Agreement only upon not less than ninety days' prior
written notice given to the other party at any time on or after the first
anniversary of the date hereof.
4. Nothing contained herein shall be construed to relieve the directors
and officers of the Company from the performance of their respective duties, or
limit the exercise of their powers, in accordance with the certificate of
incorporation or by-laws of the Company, any applicable provisions of law, or
otherwise, or to limit any liability of any person arising in connection with
the conduct or status of such person as a director or officer of the Company.
5. Subject to such rights and limitations in ERISA as may not be waived
or modified by contract, JSC shall not be liable to the Company or to any
director, officer or employee of the Company, for any cost, damage, expense or
loss, including without limitation any special, indirect, consequential or
punitive damages, of the Company or any such officer or director, allegedly
arising out of (i) JSC's failure to perform any Services for the Company
hereunder unless such failure to perform results from the gross negligence of
JSC, or (ii) the Company's or such officer's, director's or employee's reliance
on any advice or data JSC may provide to the Company pursuant to this Agreement.
JSC makes no warranties of any kind, express or implied, with respect to the
Services provided hereunder except as expressly set forth herein.
6. Any notice or other communication required by or specifically
provided for in this
Agreement shall be in writing and shall be deemed to have been given when
delivered in person, when sent by telex, telecopier or similar
telecommunications device with answerback received, or seventy-two (72) hours
after being deposited in the U.S. mails, first class postage prepaid, addressed
as follows:
If to JSC:
Jefferson Smurfit Corporation
0000 Xxxxxxxx Xxx.
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxxx
If to the Company:
Smurfit Packaging Corporation
0000 Xxxxxxxx Xxx.
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. X. Smurfit, Jr.
or to such other address as such party shall have designated by notice hereunder
to the other party.
7. This Agreement shall not be assignable by either party except with
the prior written consent of the other party hereto. Subject to the foregoing,
this Agreement shall inure to the benefit of, and be binding upon, the parties
and their respective successors and assigns.
8. This Agreement shall be governed by and construed in accordance with
the laws of the State of Missouri without giving effect to its conflict of laws.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on the date first above written.
JEFFERSON SMURFIT CORPORATION
By___________________________
Xxxx X. Xxxxx
Vice President
SMURFIT PACKAGING CORPORATION
By____________________________
Xxxxxxx X. X. Smurfit, Jr.
Chairman and Chief Executive Officer
