SUPPLEMENTAL RETIREMENT BENEFIT AND LIFE
INSURANCE AGREEMENT
THIS AGREEMENT, made and entered into this l9th
day of February, 1988, by and between POTLATCH
CORPORATION, a Delaware corporation (hereafter referred to
as "Potlatch") and XXXXXXX X. XXXXXX (hereafter referred to
as "Madden"):
Whereas the parties hereto have heretofore been
parties to an employment agreement that they now desire to
terminate; and
Whereas coincident with the termination of such
agreement Madden will become a participant in the Potlatch
Corporation Severance Program for Executive Employees, which
provides severance benefits upon the occurrence of the same
events that triggered the payment of severance benefits
under the prior employment agreement; and
Whereas the employment agreement contains provi-
sions regarding supplemental retirement benefits and life
insurance that are to continue in effect and the parties
hereto wish to record the terms of such provisions:
N o w, T h e r e f o r e, the parties hereto
agree as follows:
Exhibit (10)(e)
1. Supplemental Retirement Benefits.
(a) Amount. Upon the termination of Madden's
employment with Potlatch, Potlatch shall pay to Madden, as
supplemental retirement compensation, the amount by which
the retirement benefits payable to Madden under the Potlatch
Corporation Salaried Employees' Retirement Plan (the
"Retirement Plan") are less than the benefits that would be
payable to Madden under the Plan if the Plan provided:
(i) Retirement at or after age 60, without
reduction of benefits;
(ii) Retirement prior to age 60, with a
reduction of benefits equal to five percent multi-
plied by the number of years (and any fraction
thereof) by which Madden is less than age 60 at
the time benefits commence;
(iii) Recognition of any Management Perfor-
xxxxx Award Plan awards payable with respect to
award years 1987 and thereafter that Madden has
elected to defer as if they had been paid cur-
rently and constituted "Earnings" for purposes of
calculating Madden's Basic Benefit under Sec-
tion 4(a) of the Retirement Plan;
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(iv) Recognition of Madden's prior service
with Mobil Oil Corporation or any of its subsid-
iaries or affiliates as if it were service with
Potlatch;
(v) Recognition of the period, if any, prior
to April 27, 1989, with respect to which Madden
receives benefits under the Potlatch Corporation
Severance Program for Executive Employees as if it
were service with Potlatch; and
(vi) That benefits thereunder are payable
without regard to the benefit limitations imposed
on qualified plans by sections 401(a)(17) and 415
of the Internal Revenue Code of 1986.
The foregoing notwithstanding, the amount payable by Potlatch
to Madden pursuant to this Section 1 shall be reduced by the
amount of retirement benefits payable to Madden pursuant to
the retirement plan of Mobil Oil Corporation (the "Mobil
Benefit"). For this purpose, the Mobil Benefit shall be
converted to the same form and time of payment as the sup-
plemental retirement compensation is payable to Madden
hereunder, using the actuarial assumptions appropriate to
similar conversions under the Retirement Plan.
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(b) Form and Time of Commencement of Payment.
Madden's supplemental retirement benefits payable under the
Agreement shall be paid in the form of a straight life
annuity commencing on the date his benefits are payable
under the Retirement Plan.
(c) Effect of Madden's Death Following Termina-
tion of Service or While Employed After Normal Retirement
Date. In the event of Madden's death following the termina-
tion of his service with Potlatch or while employed by
Potlatch after his "normal retirement date" (as determined
pursuant to the Retirement Plan), his surviving spouse shall
be entitled to supplemental retirement benefits for life,
provided that she and Madden had been married for a continu-
ous period of at least five years immediately prior to
Madden's death. The supplemental retirement benefits pay-
able to Madden's surviving spouse under this Section l(c)
shall be a monthly benefit equal to 50% of the amount of
monthly supplemental retirement compensation payable to
Madden hereunder at the time of his death plus the differ-
ence between the amount of the Survivor's Pension, if any,
payable to her pursuant to Section 20 of the Retirement Plan
and the amount of the Survivor's Pension that would be
payable to her under the Retirement Plan if: (i) such Plan
recognized all non-deferred awards payable under the
Management Performance Award Plan for award years 1987 and
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thereafter as "Earnings" for purposes of calculating the
Survivor's Pension and (ii) such Plan permitted such nondeferred
awards to be taken into consideration as "Earnings" for purposes
of calculating both the Basic Benefit under Section 4(a) and the
Survivor's Pension under Section 20 of the Retirement Plan. If
Madden's surviving spouse is more than five years younger than
Madden, the amount of supplemental retirement compensation shall
be reduced to an actuarial equivalent on the basis applicable to
adjustments made pursuant to Section 20(d) of the Retirement Plan.
(d) Effect of Madden's Death While Employed Prior
to Normal Retirement Date. In the event of Madder's death while
employed by Potlatch prior to his "normal retirement date" (as
determined pursuant to the Retirement Plan), his surviving spouse
shall be entitled to supplemental retirement benefits for life.
The supplemental retirement benefit payable to Madden's surviving
spouse under this Section l(d) shall be a monthly benefit equal to
the amount of monthly supplemental retirement benefit that would
be payable to the surviving spouse hereunder if: (i) Madden's
employment had terminated and he had commenced receiving
supplemental compensation hereunder in the form of a straight life
annuity on the day before he died and (ii) Madden and his
surviving spouse had been married for a continuous period of at
least five years immediately prior to Madden's death.
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2. Supplemental Life Insurance Benefits.
(a) Amount. On or before June 1 of each year until
Madden attains age 75, Potlatch shall pay to Madden an amount
equal to the annual cost of providing an individual annual
renewable term policy issued by Executive Life Insurance Company
(or any other mutually agreed upon insurer) in the face amount of
$250,000. The payments under this Section 2 shall not be deemed to
be part of Madden's base compensation for any purpose and
Potlatch's obligation to make such payments shall terminate upon
the occurrence of any of the events described in (b) below.
(b) Termination of Potlatch's Obligation.
Potlatch's obligation to make the payments described in this
Section 2 shall terminate upon the first to occur of any of the
following events:
(i) Madden's marriage to Xxxx X. Xxxxxx is
terminated by her death or otherwise;
(ii) Before attaining age 62, Madden voluntarily
resigns employment with Potlatch (or any successor
thereto) except under circumstances described in
Section 4(a)(iii) or (iv) of the Potlatch Corporation
Severance Program for
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Executive Employees and within twelve (12) months following
such resignation assumes or accepts a position as a senior
executive in a corporation that is organized for profit
and has annual sales or revenues in excess of $250 million; or
(iii) Madden engages as an owner or employee in a
business whose principal activities are in competition with
Potlatch or uses skills or information acquired at Potlatch
relating to Potlatch business to assist others to compete
with Potlatch.
3. Recognition of Prior Service for Certain Purposes.
Madden's prior service with Mobil Oil Corporation or any of its
subsidiaries or affiliates shall be recognized as service with
Potlatch for purposes of all of Potlatch's employee benefit plans
and programs other than plans that are qualified under section
401(a) of the Internal Revenue Code of 1986, as amended.
4. Nonassignability. No right or benefit under this
Agreement shall be subject to anticipation, alienation, sale,
assignment, pledge, encumbrance or charge, and any attempt to
anticipate, alienate, sell, assign, pledge, encumber or charge the
same shall be void.
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5. Arbitration. It is understood and agreed that any
dispute, controversy, or question arising under this Agreement
shall be referred for decision by arbitration in San Francisco,
California, by an arbitrator selected by the parties hereto. The
proceeding shall be governed by the Rules of the American
Arbitration Association then in effect or such rules last in
effect (in the event such Association is no longer in existence).
If the parties are unable to agree upon such an Arbitrator within
thirty (30) days after either party has given the other party
written notice of its desire to submit the dispute, controversy or
question for decision as aforesaid, then either party may
apply to the American Arbitration Association for the
appointment of an arbitrator or, if such Association is not then
in existence or does not desire to act in the matter, either party
may apply to the Presiding Judge of the Superior Court of the City
and County of San Francisco, State of California, for the
appointment of an arbitrator to hear the parties and settle the
dispute, controversy or question, and such Judge is hereby
authorized to make such appointment. The compensation and expenses
of such Arbitrator shall be borne equally by the parties hereto.
Arbitration shall be the exclusive remedy for the
settlement of disputes arising under this Agreement or for the
breach thereof. The decision of the Arbitrator shall be
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final, conclusive, and binding on all interested persons and no
action at law or in equity shall be instituted by either party
other than to enforce the award of the Arbitrator.
6. Entire Agreement; Amendments in Writing. This
Agreement contains the entire agreement between Potlatch and
Madden on the subject matter contained herein and supersedes
all prior agreements, understandings or commitments on this
subject, whether oral or written, including, but without
limitation, that certain Employment Agreement between Potlatch
and Madden dated March 29, 1971, as subsequently amended,
that certain Employment Agreement between Potlatch and
Madden dated February 21, 1975, as subsequently amended,
that certain Employment Agreement between Potlatch and
Madden dated February 20, 1976, as subsequently amended, and
that certain Employment Agreement between Potlatch and
Madden dated March 1, 1981, as subsequently amended. No
amendments, modifications, or supplements to this Agreement
may be made except by a writing signed by both Potlatch and
Madden.
7. Governing Law. This Agreement shall be interpreted
under and pursuant to the law of the State of California.
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8. Binding Effect. This Agreement shall be binding upon
the heirs, executors, and administrators of Madden and the
successors and assigns of Potlatch.
9. Communications. All communications and notices
pertaining to this Agreement shall be in writing and shall be
deemed given if delivered by hand or mailed with postage prepaid
and addressed:
(a) If to Potlatch, to:
Potlatch Corporation
Xxx Xxxxxxxx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Secretary
(b) If to Madden, to:
P. O. Xxx 0000
Xxxxxx Xxxx
Xxxx, XX 00000
IN WITNESS WHEREOF, the parties hereto have caused this
Employment Agreement to be executed the day and year first above
written, and Mr. F. T. Weyerhaeuser has
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affixed his signature pursuant to authority granted by the
Board of Directors of Potlatch.
POTLATCH CORPORATION
By /s/F. T. Weyerhaeuser
F. T. Weyerhaeuser, Chairman
Executive Compensation and
Personnel Policies Committee
/s/Xxxxxxx X. Xxxxxx
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AMENDMENT TO EMPLOYMENT AGREEMENT
THIS AMENDMENT, entered into as of the first day of
January, 1992, by and between POTLATCH CORPORATION, a
Delaware corporation ("Potlatch") and XXXXXXX X. XXXXXX
("Madden"),
W I T N E S S E T H:
WHEREAS, Potlatch and Madden have entered into an
employment agreement dated as of February 19, 1988 (the
"Agreement"); and
WHEREAS, the Agreement contains provisions regarding
supplemental retirement benefits, and Potlatch and Madden
desire to amend such provisions:
NOW, THEREFORE, Potlatch and Madden agree that subsec-
tions 1(a)(i) through (vi) of the Agreement shall be
replaced by the following:
(i) Recognition of any Management Performance Award
Plan ("MPAP") awards payable with respect to award years
1987 and thereafter that Madden has elected to defer as if
they had been paid currently;
(ii) That the average percentage under the MPAP which
was recognized in Madden's "Average Monthly Earning" had
been 100% of the "Standard Bonus;"
(iii) Recognition of Madden's prior service with Mobil
Oil Corporation or any of its subsidiaries or affiliates
as if it were service with Potlatch; and
(iv) That benefits thereunder are payable without
regard to the benefit limitations imposed on qualified
plans by sections 401(a)(17) and 415 of the Internal
Revenue Code of 1986.
IN WITNESS WHEREOF, the parties hereto have caused
this Amendment to Employment Agreement to be executed as
of the first day of January, 1992.
POTLATCH CORPORATION
By /s/ F. T. WEYERHAEUSER
/s/Xxxxxxx X Xxxxxx
Xxxxxxx X. Xxxxxx
