1
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
-----------------------------------------
AMENDED AND RESTATED EMPLOYMENT AGREEMENT ("Agreement") made and
entered into as of the 1st day of October, 1995, by and between THE ▇▇▇▇▇▇▇▇
AND ▇▇▇▇▇▇▇▇ COMPANY, a corporation existing under the laws of the State of
Ohio ("▇▇▇▇▇▇▇▇"), and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ("▇▇▇▇▇▇").
W I T N E S S E T H:
WHEREAS, ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ have entered into an Employment Agreement
dated as of November 9, 1987, as amended effective May 8, 1989 and December 1,
1989, respectively (as so amended the "Employment Agreement"), pursuant to
which ▇▇▇▇▇▇ is currently employed as Chairman of the Board, President and
Chief Executive Officer of ▇▇▇▇▇▇▇▇; and
WHEREAS, ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ desire to amend, restate in its entirety,
and continue the Employment Agreement and enter into this Agreement on the
terms and conditions hereinafter set forth;
NOW THEREFORE, in consideration of the foregoing premises and of the
mutual promises set forth below, ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ hereby agree as follows:
1. AMENDMENT, RESTATEMENT IN ITS ENTIRETY AND CONTINUATION OF EMPLOYMENT
AGREEMENT.
Effective as of the date hereof, the Employment Agreement shall be,
and hereby is, amended, restated in its entirety and continued as set forth in
this Agreement, and all terms, conditions and provisions of the Employment
Agreement shall be, and hereby are, superseded by this Agreement and shall no
longer be of any force and effect.
2
2. DEFINITIONS.
-----------
For purposes of this Agreement, the terms set forth below shall have
the following meanings:
(a) "Annual Compensation Value" shall mean ▇▇▇▇▇▇' then-current
Base Compensation plus an amount equal to the average of all Bonuses (excluding
any compensation attributable to stock options of any type granted by ▇▇▇▇▇▇▇▇)
earned by ▇▇▇▇▇▇ during the three (3) calendar years preceding the date upon
which the valuation is made.
(b) "Base Compensation" shall mean the then-current annual base
salary (exclusive of Bonuses) of ▇▇▇▇▇▇.
(c) "Bonuses" shall mean bonus payments earned by ▇▇▇▇▇▇ under
▇▇▇▇▇▇▇▇' Incentive Compensation Plans and under any future bonus
or incentive compensation plans of ▇▇▇▇▇▇▇▇ for its executive officers.
(d) "Change in Control" shall mean the occurrence of any of the
following:
(i) Any "person," as such term is used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act") (other than ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., his children or his grandchildren,
▇▇▇▇▇▇▇▇, any trustee or other fiduciary holding securities under an employee
benefit plan of ▇▇▇▇▇▇▇▇, or any company owned, directly or indirectly, by the
shareholders of ▇▇▇▇▇▇▇▇ in substantially the same proportions as their
ownership of stock of ▇▇▇▇▇▇▇▇), is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of ▇▇▇▇▇▇▇▇ representing fifty percent
2
3
(50%) or more of the combined voting power of ▇▇▇▇▇▇▇▇' then outstanding
securities;
(ii) during any period of two (2) consecutive years (not
including any period prior to the execution of this Agreement), individuals who
at the beginning of such period constitute the Board, any new director (other
than a director designated by a person who has entered into an agreement with
▇▇▇▇▇▇▇▇ to effect a transaction described in clause (i), (iii) or (iv) of this
Section whose election by the Board or nomination for election by ▇▇▇▇▇▇▇▇'
shareholders was approved by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors at the beginning of
the period or whose election was previously so approved) cease for any reason
to constitute at least a majority thereof;
(iii) the shareholders of ▇▇▇▇▇▇▇▇ approve a merger or
consolidation of ▇▇▇▇▇▇▇▇ with any other company, other than (1) a merger or
consolidation which would result in the voting securities of ▇▇▇▇▇▇▇▇
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) more than fifty percent (50%) of the combined voting power of
the voting security of ▇▇▇▇▇▇▇▇ or such surviving entity outstanding
immediately after such merger or consolidation or (2) a merger or consolidation
effected to implement a recapitalization of ▇▇▇▇▇▇▇▇ (or similar transaction)
in which no "person" (as hereinabove defined) acquires more than fifty percent
(50%) of the combined voting power of ▇▇▇▇▇▇▇▇' then outstanding securities; or
3
4
(iv) the shareholders of ▇▇▇▇▇▇▇▇ approve a plan of
liquidation, dissolution or winding up of ▇▇▇▇▇▇▇▇ or an agreement for the sale
or disposition by ▇▇▇▇▇▇▇▇ of all or substantially all of ▇▇▇▇▇▇▇▇' assets.
(e) "Discharge For Cause" shall be construed to have occurred
whenever occasioned by reason of felonious acts on the part of ▇▇▇▇▇▇, actions
by ▇▇▇▇▇▇ involving serious moral turpitude or his misconduct in such manner as
to bring substantial and material discredit upon ▇▇▇▇▇▇▇▇, following the giving
of thirty (30) days' written notice to ▇▇▇▇▇▇ specifying the respect in which
▇▇▇▇▇▇▇▇ claims ▇▇▇▇▇▇ has violated this provision and the failure, inability
or unwillingness of ▇▇▇▇▇▇ to remedy the situation to the satisfaction of
▇▇▇▇▇▇▇▇ within said thirty-day period. In establishing whether a Discharge
For Cause shall have occurred, the standard for judgment shall be the level of
conduct by ▇▇▇▇▇▇ and by other comparably situated executive officers prior to
the alleged improper activity of ▇▇▇▇▇▇ for which the Discharge For Cause has
been made.
(f) "Escrow Agreement" shall mean the agreement dated November 9,
1987 as amended simultaneously herewith entered into between ▇▇▇▇▇▇▇▇ and Bank
One, Dayton, NA, a copy of which (including the amendment) is attached hereto
and made a part hereof as Exhibit A.
(g) "Escrow Agent" shall mean Bank One, Dayton, NA.
(h) "Escrow Amount" shall mean the amounts placed in escrow by
▇▇▇▇▇▇▇▇ pursuant to subsection (e)(iii) of Section 8 of this Agreement.
4
5
(i) "Escrow Funding Event" shall mean the occurrence of any of the
following events:
(i) Class A Common Shares of ▇▇▇▇▇▇▇▇ have been acquired
other than directly from ▇▇▇▇▇▇▇▇ in exchange for cash or property by any
person (other than ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., his children or his grandchildren,
▇▇▇▇▇▇▇▇, any trustee or other fiduciary holding securities under an employee
benefit plan of ▇▇▇▇▇▇▇▇, or any company owned directly or indirectly by the
shareholders of ▇▇▇▇▇▇▇▇ in substantially the same proportions as their
ownership of the stock of ▇▇▇▇▇▇▇▇) who either thereby becomes the owner of
more than nine and one half percent (9.5%) of ▇▇▇▇▇▇▇▇' outstanding Class A
Common Shares, or having directly or indirectly become the owner of more than
five percent (5%) of ▇▇▇▇▇▇▇▇' Class A Common Shares either alone or in
conjunction with another person has expressed an intent to continue acquiring
▇▇▇▇▇▇▇▇' outstanding Class A Common Shares so as to become thereby the owner
of more than nine and one-half percent (9.5%) of such stock either directly or
indirectly;
(ii) Any person (other than ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., his
children or grandchildren, ▇▇▇▇▇▇▇▇, any trustee or other fiduciary holding
securities under an employee benefit plan of ▇▇▇▇▇▇▇▇, or any company owned
directly or indirectly by the shareholders of ▇▇▇▇▇▇▇▇ in substantially the
same proportions as their ownership of stock of ▇▇▇▇▇▇▇▇) has made a tender
offer for, or a request for invitations for tenders of, Class A Common Shares
of ▇▇▇▇▇▇▇▇.
(iii) Any person forwards or causes to be forwarded to
shareholders of ▇▇▇▇▇▇▇▇ proxy statement(s) in any period of
5
6
twenty-four (24) consecutive months, soliciting proxies, to elect to the Board
of ▇▇▇▇▇▇▇▇ two (2) or more candidates who were not nominated as candidates in
proxy statements forwarded to shareholders during such period by the Board; or
(iv) The Board adopts a resolution to the effect that, for
purposes of this Agreement, an Escrow Funding Event has occurred.
(j) "Final Annual Compensation" shall mean ▇▇▇▇▇▇' Base
Compensation at the time of termination of employment plus an amount equal to
the average of all Bonuses (excluding any compensation attributable to stock
options of any type granted by ▇▇▇▇▇▇▇▇) earned by ▇▇▇▇▇▇ during the three (3)
calendar years preceding his termination of employment.
(k) "Final Average Annual Compensation" shall mean the average of
▇▇▇▇▇▇' Base Compensation and Bonuses (excluding any compensation attributable
to stock options of any type granted by ▇▇▇▇▇▇▇▇) as determined for the five
(5) consecutive calendar years of the last ten (10) calendar years preceding
and including the calendar year in which ▇▇▇▇▇▇' employment terminates which
yields the highest sum.
(l) "Pension Plan" shall mean the existing ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇
Company Non-Union Pension Plan, as the same may be amended from time to time.
(m) "Retirement Benefits" shall mean payments to ▇▇▇▇▇▇ based upon
his lifetime in an annual amount equal to a designated percentage of ▇▇▇▇▇▇'
Final Average Annual Compensation or, in the case of Section 8(d) below, Final
Annual Compensation, which shall
6
7
be comprised of the sum of (i) ▇▇▇▇▇▇' primary Social Security retirement
benefits when he is entitled to receive such benefit (age sixty-two (62))
[until that time an amount equal to the primary Social Security retirement
benefit shall be paid to ▇▇▇▇▇▇ from ▇▇▇▇▇▇▇▇' Supplemental Plan], (ii) ▇▇▇▇▇▇'
pension benefits determined as a life annuity (without regard to actual payment
form) under the Pension Plan and deferred compensation payments under the
Non-Qualified Deferred Compensation and Disability Benefit Agreement dated
December 20, 1984 between ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇, or such other non-contributory
deferred compensation agreement(s) then existing between ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇,
and (iii) such amount of supplemental retirement benefits under the
Supplemental Plan as shall be necessary to achieve the designated percentage of
▇▇▇▇▇▇' Final Average Annual Compensation or, in the case of Section 8(d)
below, Final Annual Compensation. In addition to said annual amount,
Retirement Benefits shall include a continuation of coverage for the remainder
of ▇▇▇▇▇▇' life under ▇▇▇▇▇▇▇▇-sponsored medical benefits and life insurance
programs, but only to the extent applicable to participants in ▇▇▇▇▇▇▇▇'
Qualified Retiree Medical Plans. For purposes of determining the amount of
supplemental retirement benefits to be made by ▇▇▇▇▇▇▇▇ pursuant to the
Supplemental Plan, the method of payment of retirement benefits to ▇▇▇▇▇▇
pursuant to the Pension Plan shall determine the amount and method of payment
of the supplemental retirement payments pursuant to the Supplemental Plan.
These supplemental retirement payments by ▇▇▇▇▇▇▇▇ pursuant to the Supplemental
Plan shall continue so long as pension benefits are
7
8
payable under the Pension Plan and shall be in addition to the pension benefit
payments under the Pension Plan.
(n) "Supplemental Plan" shall mean ▇▇▇▇▇▇▇▇' existing Supplemental
Retirement Plan, as the same may be amended from time to time.
3. TERMS AND DUTIES.
----------------
(a) The term of this Agreement shall continue from the date hereof
and end on October 3, 2000, unless extended in accordance herewith. ▇▇▇▇▇▇
shall continue in the employ of ▇▇▇▇▇▇▇▇ as Chairman of the Board, President
and Chief Executive Officer or such other substantially equivalent position
designated by the Board, consistent with the provisions of this Agreement. In
addition, ▇▇▇▇▇▇ agrees to perform such other duties as may be specifically
designated for him from time to time by the Board, consistent with the
provisions of this Agreement. Subject to ▇▇▇▇▇▇' willingness to so extend his
employment, ▇▇▇▇▇▇▇▇ may extend the term of this Agreement for additional
renewal periods of one (1) year each by giving written notice thereof not less
than twelve (12) months prior to October 3, 2000 initially and not less than
twelve (12) months prior to each succeeding October 3rd thereafter.
(b) At all times ▇▇▇▇▇▇ will, to the best of his ability, energy
and skill, faithfully perform all of the duties that may be required of him
from time to time by the Board and diligently devote his entire working time,
attention and efforts to the business affairs and best interests of ▇▇▇▇▇▇▇▇,
except for absences for sickness and vacations. If the Board determines that
8
9
any outside activity engaged in by him is detrimental to the best interests of
▇▇▇▇▇▇▇▇, he will discontinue such outside activity within thirty (30) days
after written notice from the Board.
(c) ▇▇▇▇▇▇ agrees that during the period of his employment by
▇▇▇▇▇▇▇▇, for so long as he is entitled to receive payments under this
Agreement, and for a period of two (2) years thereafter (subject to the
provisions of Section 9 below), he will not, directly or indirectly, further
the affairs of any other corporation, partnership, or any business enterprise
by employment of any kind, investment therein (except as otherwise permitted
under Section 9(d) below), counseling or otherwise, if the same is in
competition with ▇▇▇▇▇▇▇▇, without the written consent of the Board. This
provision, however, shall not be construed to prevent him from pursuing
personal investments in any business or enterprise which is not in competition
with ▇▇▇▇▇▇▇▇ and which do not interfere with his employment and the
performance of his duties to ▇▇▇▇▇▇▇▇ hereunder.
4. COMPENSATION AND FRINGE BENEFITS.
--------------------------------
(a) The Base Compensation of ▇▇▇▇▇▇ during the term of this
Agreement shall be $436,300, which may be increased from time to time by the
Board or, in the case of any proposed decrease, such other amount as mutually
may be agreed upon by ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇; provided, however, that such Base
Compensation may not be reduced below said rate of $436,300 without ▇▇▇▇▇▇'
consent, unless necessitated by general business conditions adversely affecting
▇▇▇▇▇▇▇▇' operations; but, in the event of a reduction, his Base Compensation
shall be fair and reasonable, and any disagreement
9
10
concerning the same shall be resolved by arbitration in the manner provided in
Section 10 below. ▇▇▇▇▇▇' Base Compensation shall be reviewed at least
annually to determine whether in view of ▇▇▇▇▇▇▇▇' performance during the year
any increase is warranted. Responsibility for this determination rests within
the sole discretion of the Board, and this provision shall not be construed as
requiring any such increase for any given year.
(b) ▇▇▇▇▇▇ shall continue his participation in the existing
Deferred Compensation Plan and the existing bonus plan arrangements under the
Incentive Compensation Plans (or their equivalent) for executive officers of
▇▇▇▇▇▇▇▇ and shall be entitled to such awards under any future bonus,
incentive, or similar compensation plans of ▇▇▇▇▇▇▇▇, as shall, in the
determination of the Board, be appropriate and consistent with the purposes of
such plans and with the awards granted to other executive officers of ▇▇▇▇▇▇▇▇.
(c) ▇▇▇▇▇▇ shall continue to be eligible for participation in the
Stock Option Plan - 1995 of ▇▇▇▇▇▇▇▇ and shall be entitled to the grant of such
options to purchase shares of Class A Common Stock ("Common Stock") of ▇▇▇▇▇▇▇▇
under any other future stock option plans for employees and to participate in
such other executive compensation incentive plans awarding stock as shall, in
the determination of the Board, be appropriate and consistent with the purposes
of the plans and with the grants of such options to the executive officers of
▇▇▇▇▇▇▇▇. Effective the date hereof, ▇▇▇▇▇▇▇▇ hereby awards ▇▇▇▇▇▇
non-qualified stock options covering 200,000 shares of Common Stock on the
terms and conditions of the Stock Option Agreement entered into between the
parties
10
11
simultaneously herewith and attached hereto as Exhibit B and made a part
hereof. Subject to his then being employed by ▇▇▇▇▇▇▇▇, on October 1, 1996,
▇▇▇▇▇▇▇▇ shall award ▇▇▇▇▇▇ non-qualified stock options covering an additional
100,000 shares of Common Stock. At the time of this option award, ▇▇▇▇▇▇▇▇ and
▇▇▇▇▇▇ shall enter into a Stock Option Agreement covering such options in the
form of Exhibit C attached hereto and made a part hereof.
(d) In addition to the specific benefits provided for ▇▇▇▇▇▇ under
the terms of this Agreement, ▇▇▇▇▇▇▇▇ shall provide him with other fringe
benefits (including bonuses, vacations, health and disability insurance,
pension plan participation and others) at least equivalent to those of the
other executive officers of ▇▇▇▇▇▇▇▇ and as set forth on Exhibit D attached
hereto and made a part hereof.
5. EXPENSES.
--------
▇▇▇▇▇▇ shall be reimbursed for his reasonable business-related
expenses incurred for the benefit of ▇▇▇▇▇▇▇▇ in accordance with ▇▇▇▇▇▇▇▇'
policies governing such reimbursement in effect from time to time. Such
expenses shall include, but shall not be limited to, travel, lodging away from
home, entertainment, and meals. With respect to any expenses which are
reimbursed by ▇▇▇▇▇▇▇▇ to ▇▇▇▇▇▇, ▇▇▇▇▇▇ shall account to ▇▇▇▇▇▇▇▇ in
sufficient detail to entitle ▇▇▇▇▇▇▇▇ to a federal income tax deduction for
such reimbursed item if such item is deductible.
11
12
6. RETIREMENT AND EARLY RETIREMENT BENEFITS.
----------------------------------------
(a) If ▇▇▇▇▇▇ continues his employment with ▇▇▇▇▇▇▇▇ until he
attains age fifty-nine (59), he shall be entitled to receive at the time of his
retirement Retirement Benefits at a level equal to sixty-five percent (65%) of
his Final Average Annual Compensation. If ▇▇▇▇▇▇ continues his employ with
▇▇▇▇▇▇▇▇ beyond age fifty-nine (59), the level of his retirement benefits as a
percentage of his Final Average Annual Compensation shall be increased by one
percent (1%) for each additional twelve (12) month period over age fifty-nine
(59).
(b) ▇▇▇▇▇▇ may elect to retire from ▇▇▇▇▇▇▇▇ upon giving twelve
(12) months prior written notice and having attained at least age fifty-five
(55) and he shall be entitled to receive at the time of such early retirement
Retirement Benefits at a level equal to sixty-one percent (61%) of his Final
Average Annual Compensation. If ▇▇▇▇▇▇ elects to retire upon giving twelve
(12) months prior written notice at any time from age fifty-six (56) through
age fifty-nine (59), the level of his Retirement Benefits as a percentage of
his Final Average Annual Compensation shall be increased by one percent (1%)
for each additional twelve (12) month period over age fifty-five (55).
(c) To the extent ▇▇▇▇▇▇ receives any similar benefits under the
Pension Plan, Supplemental Plan or other ▇▇▇▇▇▇▇▇ benefit plan for any of its
employees, such benefits shall be included in calculating the amount to which
▇▇▇▇▇▇ shall be entitled under Sections 6(a) and 6(b) above; provided, however,
that in no event
12
13
shall the benefits described in Sections 6(a) and 6(b) above be reduced by the
provisions of this Section 6(c).
7. DISABILITY AND DEATH BENEFITS.
-----------------------------
(a) If ▇▇▇▇▇▇ becomes disabled prior to his retirement, he shall
be deemed to have elected retirement under this Agreement. See Section 8(c)
below.
(b) In the event of ▇▇▇▇▇▇' death while still employed by ▇▇▇▇▇▇▇▇
pursuant to this Agreement, ▇▇▇▇▇▇ shall be entitled to Retirement Benefits
calculated as if he had elected retirement as of the day before his actual
death. ▇▇▇▇▇▇▇▇ shall also pay to such beneficiary or beneficiaries as he
shall have designated by written notice delivered to ▇▇▇▇▇▇▇▇ prior to his
death, or failing such written notice, to his estate, an amount equal to the
Base Compensation plus the Bonuses, if any, which ▇▇▇▇▇▇ would have received or
which would have been accrued for his benefit during the period of six (6)
months immediately following his death if he had lived and had been employed by
▇▇▇▇▇▇▇▇ during that period. Such payment shall be made in one lump sum or in
six (6) equal monthly installments as ▇▇▇▇▇▇▇▇ shall elect and shall be in
addition to the proceeds of any insurance policies carried on ▇▇▇▇▇▇' life with
respect to which he has the right to designate beneficiaries. Also, ▇▇▇▇▇▇▇▇
shall pay to ▇▇▇▇▇▇' spouse an amount, periodically as such payments are
required to be made by said spouse, to enable her to continue medical coverage
for her and her dependents in the same manner as immediately prior to ▇▇▇▇▇▇'
death for a period expiring at the earlier of: (i) her death; (ii) forty-two
(42) months after ▇▇▇▇▇▇' death; or (iii)
13
14
eligibility for regular Medicare and Medicaid or any successor programs
furnished by the government. Thereafter, ▇▇▇▇▇▇▇▇ shall make available to
▇▇▇▇▇▇' spouse (including her dependents), at her cost, such medical coverage
as shall be available to a person of her then age under the then-existing
▇▇▇▇▇▇▇▇-sponsored medical benefits program, but only to the extent coverage is
available under such program.
8. TERMINATION; DISCHARGE.
----------------------
(a) TERMINATION OR DISCHARGE WITHOUT CAUSE. ▇▇▇▇▇▇▇▇ reserves the
right to discharge ▇▇▇▇▇▇ at any time and for any reason and not to renew this
Agreement; but such non-renewal or discharge, unless a Discharge For Cause,
shall not extinguish the obligation of ▇▇▇▇▇▇▇▇ to provide ▇▇▇▇▇▇ (and, in the
event of his prior death, his designated beneficiary or beneficiaries or his
estate) with the following severance benefits:
(i) If ▇▇▇▇▇▇▇▇ does not renew this Agreement, ▇▇▇▇▇▇
shall be deemed to have elected retirement under this Agreement and he shall be
entitled to receive the Retirement Benefits set forth in Section 6 above. He
shall not be entitled to any other severance benefits under this Agreement.
(ii) If such discharge occurs prior to October 3, 2000,
▇▇▇▇▇▇ shall be entitled to receive for a period expiring two (2) years from
the date of discharge, payments from ▇▇▇▇▇▇▇▇ in an amount equal to his Annual
Compensation Value, which shall be reduced by seventy percent (70%) of the
amount of compensation received by ▇▇▇▇▇▇ from any subsequent employment
obtained by him during said payment period.
14
15
(iii) ▇▇▇▇▇▇ shall be entitled, during the period expiring
on the earlier of ▇▇▇▇▇▇' securing other employment or two (2) years from the
date of discharge (or such longer period as required by law), to continuing
coverage under the then-existing ▇▇▇▇▇▇▇▇-sponsored medical benefits program,
which, at the option of ▇▇▇▇▇▇▇▇, may be provided outside of such program
through the purchase of insurance or otherwise.
(iv) For purposes of determining ▇▇▇▇▇▇' benefits under
the Supplemental Plan, ▇▇▇▇▇▇ shall receive credit toward his Years of Service
under the Supplemental Plan for the time period that he receives or is entitled
to receive payments under subsection (ii) of this Section 8(a). In addition,
during the time period that he receives or is entitled to receive payments
under said subsection (ii) of this Section 8(a), ▇▇▇▇▇▇' Base Compensation
shall be deemed to be increased by the annual economic range adjustment for
▇▇▇▇▇▇▇▇' salaried employees announced in October of each year (or, if there is
no such announced economic range adjustment in a given year, by an assumed five
(5%) increase for that year) in order to calculate his highest earnings during
five (5) consecutive years out of the last ten (10) years prior to retirement
under the Supplemental Plan, and his Final Annual Compensation (see Section
8(d) below) and Final Average Annual Compensation shall be deemed to increase
in the same manner for purposes of determining the amount of his Retirement
Benefits under this Agreement.
(v) ▇▇▇▇▇▇ shall be reimbursed for up to $20,000 for
out-placement fees if he chooses to seek other employment following his
discharge by ▇▇▇▇▇▇▇▇. ▇▇▇▇▇▇ shall not be obligated to seek
15
16
other employment in order to mitigate his damages resulting from his discharge.
(vi) In addition to all of the foregoing, ▇▇▇▇▇▇ shall be
entitled to receive the payments required of ▇▇▇▇▇▇▇▇ under his then-existing
deferred compensation agreement(s) with ▇▇▇▇▇▇▇▇ in accordance with the terms
of such agreement(s).
▇▇▇▇▇▇ acknowledges that he shall remain subject to and bound
by the restrictive provisions of Section 9 below.
(b) DISCHARGE FOR CAUSE. If ▇▇▇▇▇▇' employment with ▇▇▇▇▇▇▇▇ is
terminated by a Discharge For Cause, regardless of whether such Discharge For
Cause occurs after the occurrence of any of the events set forth in Sections
8(d) or 8(e) below, he shall be entitled to receive only his Base Compensation
up to the date of his discharge and no further payments hereunder shall be
required from ▇▇▇▇▇▇▇▇; provided, however, that ▇▇▇▇▇▇ shall be entitled to
receive his benefits, if any, under the Pension Plan and the payments required
of ▇▇▇▇▇▇▇▇ under his then-existing deferred compensation agreement(s) with
▇▇▇▇▇▇▇▇ in accordance with the terms of such agreement(s). ▇▇▇▇▇▇ shall
remain subject to the restrictive provisions of Section 9 below for a period
for two (2) years from the date of discharge. Should ▇▇▇▇▇▇ disagree that his
discharge was a Discharge For Cause the question shall be submitted to
arbitration in accordance with Section 10 below.
(c) TERMINATION DUE TO DISABILITY. If, by reason of illness,
disability, or other incapacity certified by two (2) physicians competent to do
so in the opinion of ▇▇▇▇▇▇▇▇' Board of Directors, ▇▇▇▇▇▇ is unable to perform
the duties required of him under this
16
17
Agreement for a period of six (6) consecutive months, ▇▇▇▇▇▇▇▇, following the
giving of thirty (30) days' written notice to ▇▇▇▇▇▇ and the failure of ▇▇▇▇▇▇
by reason of illness, disability, or other incapacity to resume his duties
within such thirty (30) days and thereafter perform the same for a period of
two (2) consecutive months, may terminate ▇▇▇▇▇▇' employment by giving ▇▇▇▇▇▇
written notice thereof; and in that event all obligations of ▇▇▇▇▇▇▇▇ hereunder
shall cease on the date such notice of termination is given except for payment
of the Retirement Benefits under Section 6 above.
(d) BENEFITS UPON TERMINATION UNDER CERTAIN CURCUMSTANCES. If
▇▇▇▇▇▇ voluntarily terminates his employment or ▇▇▇▇▇▇ is discharged by
▇▇▇▇▇▇▇▇ and such discharge is not a Discharge For Cause, and if such voluntary
termination or involuntary discharge takes place within eighteen (18) months
after the occurrence of any of the following events:
(i) ▇▇▇▇▇▇ is required by ▇▇▇▇▇▇▇▇, prior to a Change in
Control, to perform duties or services which differ significantly from those
performed by him on the effective date hereof, or which are not ordinarily and
generally performed by a Chairman of the Board, President and Chief Executive
Officer of a corporation similar in size and scope to ▇▇▇▇▇▇▇▇; or
(ii) The nature of the duties or services which ▇▇▇▇▇▇▇▇,
prior to a Change in Control, requires him to perform necessitates absence
overnight from his place of residence on the effective date hereof, because of
travel involving the business or affairs of ▇▇▇▇▇▇▇▇, for more than ninety (90)
days during any period of
17
18
twelve (12) consecutive months; ▇▇▇▇▇▇ shall be entitled to receive from
▇▇▇▇▇▇▇▇ all of the severance benefits set forth in Section 8(a) above, except
that severance payments shall be made until the later of the end of the term of
this Agreement or two (2) years from the date of his termination of employment
and ▇▇▇▇▇▇' right to receive his Retirement Benefits shall be based upon his
Final Annual Compensation, as the same may be adjusted pursuant to Section
8(a)(iv) above. ▇▇▇▇▇▇ shall remain subject to and bound by the restrictive
provisions of Section 9 below.
(e) BENEFITS UPON A CHANGE IN CONTROL. ▇▇▇▇▇▇▇▇ recognizes that
the threat of a Change in Control would be of significant concern to ▇▇▇▇▇▇.
The following provisions provide termination protection for ▇▇▇▇▇▇ in the event
of a Change in Control. These provisions, among other purposes, are intended
to ▇▇▇▇▇▇ and encourage ▇▇▇▇▇▇' continued attention and dedication to his
duties in the event of such potentially disturbing and disruptive
circumstances. ▇▇▇▇▇▇▇▇, therefore, agrees to do the following:
(i) If ▇▇▇▇▇▇▇▇ terminates ▇▇▇▇▇▇' employment for any reason
other than a Discharge for Cause, or if ▇▇▇▇▇▇ terminates his employment with
▇▇▇▇▇▇▇▇ voluntarily for any reason other than disability or retirement within
the twenty-four (24) month period following a Change in Control, ▇▇▇▇▇▇ shall
be entitled to receive from ▇▇▇▇▇▇▇▇ the following benefits:
(A) A lump sum severance payment (the "Severance
Payment"), in cash, equal to three (3) times the sum of (i) the higher of
▇▇▇▇▇▇' annual Base Compensation in effect immediately prior to the occurrence
of the event or circumstance upon which
18
19
such termination of employment is based or in effect immediately prior to the
Change in Control, and (ii) the average of ▇▇▇▇▇▇' Bonuses during the three (3)
calendar years immediately preceding the year in which the date of termination
occurs.
(B) ▇▇▇▇▇▇ shall be entitled, during the period expiring
on the earlier of ▇▇▇▇▇▇' securing other employment or twenty-four (24) months
from the date of such termination of employment (or such longer period as
required by law), to continued coverage under the ▇▇▇▇▇▇▇▇ sponsored medical
benefits program in existence on such date of termination or, if such continued
coverage is barred, ▇▇▇▇▇▇▇▇ shall provide equivalent medical benefit coverage
through the purchase of insurance or otherwise.
(C) For purposes of determining ▇▇▇▇▇▇' benefits under
the Supplemental Plan, ▇▇▇▇▇▇ shall receive credit toward his Years of Service
under the Supplemental Plan for the two (2) year period following such
termination of employment. In addition, with respect to the two (2) year
period following such termination of employment, ▇▇▇▇▇▇' Base Compensation
shall be deemed to be increased by the annual economic range adjustment for
▇▇▇▇▇▇▇▇' salaried employees announced in October of each year (or, if there is
no such announced economic range adjustment in a given year, by an assumed five
percent (5%) increase for that year) in order to calculate his highest earnings
during five (5) consecutive years out of the last ten (10) years prior to
retirement under the Supplemental Plan.
(D) ▇▇▇▇▇▇ shall be reimbursed for up to $20,000 for
outplacement fees if he chooses to seek other employment following
19
20
his discharge by ▇▇▇▇▇▇▇▇. ▇▇▇▇▇▇ shall not be obligated to seek other
employment in order to mitigate his damages resulting from his discharge.
(E) In addition to all of the foregoing, ▇▇▇▇▇▇ shall be
entitled to receive the payments required of ▇▇▇▇▇▇▇▇ under his then-existing
deferred compensation agreement(s) with ▇▇▇▇▇▇▇▇ in accordance with the terms
of such agreement(s), and the retirement benefit provided for in Section 6 of
this Agreement.
The benefits provided in this Section 8(e) shall be in lieu of
any benefits provided under Section 8(d) of this Agreement.
(ii) Notwithstanding any other provisions of this Agreement,
in the event that any payment or benefit received or to be received by ▇▇▇▇▇▇ in
connection with a Change in Control or the termination of ▇▇▇▇▇▇' employment
(whether pursuant to the terms of this Agreement or any other plan, arrangement
or agreement with ▇▇▇▇▇▇▇▇, any person whose actions result in a Change in
Control or any person affiliated with ▇▇▇▇▇▇▇▇ or such person) (all such
payments and benefits, including the Severance Payment, being hereinafter
called "Total Payments") would be subject (in whole or part), to an excise tax
pursuant to Sections 280G and 4999 of the Internal Revenue Code of 1986, as
amended (the "Code") (such tax hereinafter referred to as the "Excise Tax"),
then the Severance Payment shall be reduced to the extent necessary so that no
portion of the Total Payments is subject to Excise Tax (after taking into
account any reduction in the Total Payments provided by reason of Section 280G
of the Code in such other plan, arrangement or agreement) if (A) the net amount
of such Total Payments, as so
20
21
reduced, (and after deduction of the net amount of federal, state and local
income tax on such Total Payments), is greater than (B) the excess of (i) the
net amount of such Total Payments, without reduction (but after deduction of
the net amount of federal, state and local income tax on such Total Payments),
over (ii) the amount of Excise Tax to which ▇▇▇▇▇▇ would be subject in respect
of such Total Payments. For purposes of determining whether and the extent to
which the Total Payments will be subject to the Excise Tax, (i) no portion of
the Total Payments the receipt or enjoyment of which ▇▇▇▇▇▇ shall have
effectively waived in writing prior to the date of this termination of
employment shall be taken into account, (ii) no portion of the Total Payments
shall be taken into account which in the opinion of tax counsel selected by
▇▇▇▇▇▇▇▇ does not constitute a "parachute payment" within the meaning of
Section 280G(b)(2) of the Code, (including by reason of Section 280G(b)(4)(A)
of the Code) and, in calculating the Excise Tax, no portion of such Total
Payment shall be taken into account which constitutes reasonable compensation
for services actually rendered, within the meaning of Section 280G(b)(4)(B) of
the Code, in excess of the base amount as defined in Section 280G(b)(3) of the
Code allowable to such reasonable compensation, and (iii) the value of any
non-cash benefit or any deferred payment or benefit included in the Total
Payments shall be determined by ▇▇▇▇▇▇▇▇ in accordance with the principles of
Sections 280G(d)(3) and (4) of the Code. Prior to the fifth day following the
date of ▇▇▇▇▇▇' termination of employment, ▇▇▇▇▇▇▇▇ shall provide ▇▇▇▇▇▇ with
its calculation of the amounts referred to in this Section and such supporting
21
22
materials as are reasonably necessary for ▇▇▇▇▇▇ to evaluate ▇▇▇▇▇▇▇▇'
calculations. If ▇▇▇▇▇▇ objects to ▇▇▇▇▇▇▇▇' calculations, he shall notify
▇▇▇▇▇▇▇▇ of his objections prior to the initial payment date set forth in
Section 8(e)(vi) hereof, and ▇▇▇▇▇▇▇▇ shall pay to ▇▇▇▇▇▇ such portion of the
Severance Payment (up to one hundred percent (100%) thereof) as ▇▇▇▇▇▇
determines is necessary to result in ▇▇▇▇▇▇' receiving the greater of clauses
(A) and (B) of this Section.
(iii) Upon the occurrence of an Escrow Funding Event,
▇▇▇▇▇▇▇▇ shall pay into an escrow account at the Escrow Agent an amount equal
to three (3) times the sum of (i) ▇▇▇▇▇▇' Base Compensation in effect
immediately prior to the Escrow Funding Event and (ii) the average of ▇▇▇▇▇▇'
Bonuses during the three (3) calendar years immediately preceding the year in
which the Escrow Funding Event occurs. Subsequent to the delivery to the
Escrow Agent of the Escrow Amount, ▇▇▇▇▇▇▇▇ shall, in the event that either
▇▇▇▇▇▇' Base Compensation is increased (or decreased) or he receives a Bonus
that affects the amount described in Section 8(e)(i)(A), unless the Escrow
Amount shall theretofore have been released pursuant to this subsection,
recalculate the Escrow Amount as of the date such change in Base Compensation
or receipt of Bonus occurs, treating the Escrow Funding Event as having
occurred on such date. If the amount so calculated exceeds the fair market
value of the Escrow Amount, ▇▇▇▇▇▇▇▇ shall promptly (and in no event later than
seven (7) days from such date) pay to the Escrow Agent an amount in cash (or
marketable securities or any combination thereof) equal to such excess. If the
Escrow Amount so
22
23
calculated is less than the fair market value of the Escrow Amount then held in
the escrow account, the Escrow Agent, upon receipt of a written request from
▇▇▇▇▇▇▇▇, shall distribute to ▇▇▇▇▇▇▇▇ such difference in cash; provided,
however, that this sentence shall not apply after the occurrence of a Change in
Control.
(iv) Unless the parties otherwise agree, ▇▇▇▇▇▇▇▇ may
withdraw the Escrow Amount when and only when two (2) years have expired from
the date of deposit and no proper demand pursuant to Section 8(e)(vi) below has
been made during the time, or when the conditions requiring the deposit have
ceased to exist for a period of ninety (90) days without a demand right having
been created, or when ▇▇▇▇▇▇' right to a payment under this Section 8(e) has
been forfeited, whichever occurs first. If, before the expiration of such
period or forfeiture, there shall occur another Escrow Funding Event, ▇▇▇▇▇▇▇▇
will not be required to make an additional deposit, but the two (2) year period
shall then be measured from the date of the last such event. Notwithstanding a
deposit with the Escrow Agent pursuant to subsection (iii) of this Section
8(e), ▇▇▇▇▇▇ shall continue to be entitled to receive all of the benefits from
▇▇▇▇▇▇▇▇ under this Agreement until a termination of employment shall occur.
(v) ▇▇▇▇▇▇▇▇ shall pay the charges of the Escrow Agent
for its services under the Escrow Agreement, and ▇▇▇▇▇▇▇▇ will be entitled to
any interest or other income arising from the date of the deposit of the Escrow
Amount until all payments have been made under the Escrow Agreement to ▇▇▇▇▇▇.
All interest or other income
23
24
arising from the Escrow Amount deposited with the Escrow Agent shall be paid
monthly to ▇▇▇▇▇▇▇▇.
(vi) If ▇▇▇▇▇▇▇▇ terminates ▇▇▇▇▇▇' employment for any
reason but a Discharge for Cause, or if ▇▇▇▇▇▇ terminates his employment with
▇▇▇▇▇▇▇▇ voluntarily for any reason other than disability or retirement within
the twenty-four (24) month period following the date of a Change in Control,
the Escrow Agent, upon written demand made on or after the tenth (10th) day
following such termination of employment, shall pay the Escrow Amount in
accordance with this Section and ▇▇▇▇▇▇ shall no longer be subject to the
restrictive provisions of Section 9 below, except for Section 9(e). ▇▇▇▇▇▇
shall notify the Escrow Agent prior to the tenth (10th) day following his
termination of employment as to whether he has accepted the determination of
▇▇▇▇▇▇▇▇ of the amount of the Severance Payments pursuant to Section 8(e)
(iii). If he has accepted such determination, ▇▇▇▇▇▇▇▇ shall provide the
Escrow Agent with ▇▇▇▇▇▇▇▇' written determination as set forth in Section 8(e)
(iii) and the Escrow Agent shall pay to ▇▇▇▇▇▇ all or a portion of the Escrow
Amount as provided in such determination, and any remaining amount shall be
paid to ▇▇▇▇▇▇▇▇. If ▇▇▇▇▇▇ does not accept ▇▇▇▇▇▇▇▇' determination, ▇▇▇▇▇▇
shall provide to the Escrow Agent his determination of the Severance Payment,
and the Escrow Agent shall pay to ▇▇▇▇▇▇ all or a portion of the Escrow Amount
as provided in ▇▇▇▇▇▇' determination and any remaining amount shall be paid to
▇▇▇▇▇▇▇▇.
(vii) In the event that, following the creation of a demand
right pursuant to Section 8(e)(vi) above, ▇▇▇▇▇▇ incurs any
24
25
costs or expenses, including attorneys' fees, in the enforcement of rights
under this Section 8(e) or under any plan for the benefit of employees of
▇▇▇▇▇▇▇▇, including without limitation the stock option plan, pension plans,
payroll-based stock ownership plan, tax deferred savings and protection plan,
bonus arrangements, supplemental pension plan, deferred compensation
agreements, incentive compensation plans, and life insurance and compensation
program, then, unless ▇▇▇▇▇▇▇▇ or the consolidated, surviving or transferee
entity in the event of a consolidation, merger or sale of assets, is wholly
successful in defending against the enforcement of such rights, ▇▇▇▇▇▇▇▇, or
such consolidated, surviving or transferee entity, shall promptly pay to ▇▇▇▇▇▇
all such costs and expenses.
9. NON-COMPETITION; CONFIDENTIALITY.
--------------------------------
(a) In order to protect ▇▇▇▇▇▇▇▇, it is understood that a covenant
not to compete is a necessary and appropriate adjunct to the other provisions
of this Agreement. Therefore, should ▇▇▇▇▇▇ at any time determine prior to the
expiration of this Agreement that he does not desire to remain an employee of
▇▇▇▇▇▇▇▇ and shall terminate his employment for any reason other than the
grounds specified in Section 8(e) above, or should he be Discharged For Cause
by ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ shall remain subject to the restrictive provisions
hereinafter set forth. In addition, these restrictive provisions shall remain
in full force and effect at any other time during which payments are required
to be made by ▇▇▇▇▇▇▇▇ pursuant to the retirement (Section 6), severance
(Section 8, except for Section 8(e)(vi)) or disability (Section 7)
25
26
provisions of this Agreement. These restrictive provisions are as follows:
(b) For a period of two (2) years from and after ▇▇▇▇▇▇'
employment with ▇▇▇▇▇▇▇▇ shall have terminated and after he shall have ceased
receiving retirement, severance or disability benefits under this Agreement,
whichever shall last occur, he shall not, directly or indirectly, compete with
▇▇▇▇▇▇▇▇ or any of its related or affiliated companies. For purposes of this
Agreement, competition with ▇▇▇▇▇▇▇▇ or any of its related or affiliated
companies shall include the manufacture, distribution, and sale of business
forms and computer hardware and software and the furnishing of EDP services
which are similar in nature or function to the products and/or services then
being furnished by ▇▇▇▇▇▇▇▇ for sale in the same vertical markets in which
▇▇▇▇▇▇▇▇' products and/or services are then being marketed at the time of
▇▇▇▇▇▇' termination of employment or upon the cessation of any retirement,
severance or disability benefits under this Agreement.
(c) From and after the execution of this Agreement and for a
period of two (2) years after termination of his employment with ▇▇▇▇▇▇▇▇ and
after he shall have ceased receiving retirement, severance or disability
benefits under this Agreement, whichever shall last occur, ▇▇▇▇▇▇ shall not,
directly or indirectly, by direct participation, by purchase of stocks or bonds
or other evidences of indebtedness, by loaning of money, by guarantee of loans
of others, by gift to establish or assist others, or in any other manner or
fashion, engage in any such restricted activity in competition with ▇▇▇▇▇▇▇▇ or
any of its related or affiliated
26
27
companies, nor shall he assist any present employees of ▇▇▇▇▇▇▇▇ or any other
person similarly to engage in such competing business for the full two-year
prohibition period set forth in this Agreement.
(d) The restrictive provisions of this Section 9, however, are in
no way intended to prohibit ▇▇▇▇▇▇ from acquiring in open market transactions
investments in equity stock or evidences of indebtedness of a corporation if
the said stock or if the said evidence of indebtedness is traded on a national
or regional securities exchange or in the over-the-counter market and the
investment therein represents no more than five percent (5%) of the outstanding
securities of the issue being acquired. Moreover, it is not the intention of
this Section 9 to limit in any way ▇▇▇▇▇▇' ability to invest in businesses not
competitive with ▇▇▇▇▇▇▇▇.
(e) ▇▇▇▇▇▇ shall keep secret and inviolate all knowledge or
information of a confidential nature (which is not then nor later, through no
breach of this Agreement, in the public domain), including all unpublished
matters related to, without limitation thereof, the business, properties,
accounts, books and records, research and development information, processes,
procedures, products, know-how, trade secrets, memoranda, devices, suppliers,
and customers of ▇▇▇▇▇▇▇▇ which he may now know or hereafter come to know as a
result of his affiliation in business with ▇▇▇▇▇▇▇▇.
(f) All copyrights, improvements, discoveries and inventions and
all claims, interest and rights thereto relating to any part of the business of
▇▇▇▇▇▇▇▇ conceived, developed or made by ▇▇▇▇▇▇, either alone or with others,
during the period of his employment, and whether conceived, developed or made
during his regular working
27
28
hours or at any other time during such period, shall be and are the sole
property of ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ hereby assigns to ▇▇▇▇▇▇▇▇ all right, title and
interest in and to such copyrights, improvements, discoveries and inventions.
Further, ▇▇▇▇▇▇ will, at any time in the future upon ▇▇▇▇▇▇▇▇' request, execute
specific assignments of any said copyrights, improvements, discoveries and
inventions as well as execute all documents and perform all lawful acts which
▇▇▇▇▇▇▇▇ deems necessary or advisable to vest full ownership thereof in
▇▇▇▇▇▇▇▇, to register same in the name of ▇▇▇▇▇▇▇▇ or its designee or otherwise
to provide legal protection for ▇▇▇▇▇▇▇▇' ownership interests therein.
(g) This Agreement shall be without geographical limitation in
continental North America and, in addition, in any other areas of the world in
which ▇▇▇▇▇▇▇▇ or any of its related or affiliated companies shall be doing
business at the time of the proposed competing entry into business by ▇▇▇▇▇▇,
it being agreed that the contacts of ▇▇▇▇▇▇ and the potential scope of
operation of ▇▇▇▇▇▇▇▇ is without any limitation within the area of prohibition.
Any violation of this covenant may be enforced by specific performance in any
court of competent jurisdiction within the area of limitation imposed by this
provision. If any court of competent jurisdiction shall determine that either
the period or the territory covered by this provision against competition in
unreasonable, said provision shall not be determined to be null, void, and of
no effect but shall be reformed by said court to impose a reasonable period or
a reasonable geographical limitation, as the case may be.
28
29
10. RESOLUTION OF DISPUTES; ARBITRATION.
(a) Except for the breach or threatened breach by ▇▇▇▇▇▇ of the
noncompetition provisions of this Agreement which may be enforced by
appropriate injunctive relief at the option of ▇▇▇▇▇▇▇▇, any dispute or
controversy arising out of or relating to this Agreement, including, but not
limited to, whether ▇▇▇▇▇▇ has been Discharged for Cause, shall be submitted to
and settled by arbitration in Dayton, Ohio in accordance with the rules then
pertaining of the American Arbitration Association.
(b) Should ▇▇▇▇▇▇ disagree that his termination was due to a
Discharge for Cause, the question shall, within thirty (30) days after the
termination, be submitted to arbitration by three (3) arbitrators, one of whom
shall be selected by ▇▇▇▇▇▇▇▇, another of whom shall be selected by ▇▇▇▇▇▇, and
the third of whom shall be selected by the two arbitrators so appointed. The
decision of these arbitrators on the question shall be final and conclusive
upon ▇▇▇▇▇▇▇▇ and upon ▇▇▇▇▇▇ and his wife or widow, personal representatives,
designated beneficiaries and heirs, and shall be enforceable in any court
having competent jurisdiction thereof. A discharge which is eventually
determined under arbitration to have been a Discharge for Cause, or no
arbitration having been requested and the discharge being one which ▇▇▇▇▇▇▇▇
had determined was for a Discharge for Cause, shall extinguish any and all
liability of ▇▇▇▇▇▇▇▇ under this Agreement from and after the date of
termination.
(c) The arbitrators for all other disputes or controversies under
this Agreement shall be selected as set forth above and the
29
30
parties shall select the arbitrators within thirty (30) days after demand from
▇▇▇▇▇▇ or ▇▇▇▇▇▇▇▇ to the other to settle matters by arbitration. As stated
above, the decision of the arbitrators shall be final and conclusive.
11. NONASSIGNABLE RIGHTS.
--------------------
▇▇▇▇▇▇, his wife, or his widow after his death, or his personal
representatives, designated beneficiaries and heirs, shall not have the right
to anticipate or commute, or to sell, assign, transfer, or otherwise alienate
or convey the right to receive any payments hereunder, whether by his, her or
their voluntary or involuntary act, or by operation of law and, in particular,
that any payments due hereunder shall not be subject to attachment or
garnishment or any other legal proceedings by any creditor, or be in any way
responsible for the debts or liabilities of ▇▇▇▇▇▇ or his wife or his widow
after his death or his personal representatives, designated beneficiaries and
heirs. Should ▇▇▇▇▇▇ or his wife or his widow after his death or his personal
representatives, designated beneficiaries and heirs, voluntarily attempt to
breach this Section of this Agreement, ▇▇▇▇▇▇▇▇' liability to make payments
hereunder from and after the date of said attempt shall be extinguished; and
should any attempt be made to reach the payments by other than ▇▇▇▇▇▇ or his
wife or his widow after his death or his personal representatives, designated
beneficiaries and heirs, ▇▇▇▇▇▇▇▇ shall make each payment as it becomes due to
such person or persons for the sole benefit of ▇▇▇▇▇▇ or his wife or his widow
or his personal representatives,
30
31
designated beneficiaries and heirs, as the case may be, as ▇▇▇▇▇▇▇▇ may ▇▇▇▇
expedient.
12. UNFUNDED AGREEMENT.
------------------
(a) ▇▇▇▇▇▇▇▇' obligation under this Agreement shall be unfunded,
but ▇▇▇▇▇▇▇▇ reserves the right to provide for its liability under this
Agreement in any manner it deems advisable, including the purchasing of such
assets (including an insurance policy or policies on ▇▇▇▇▇▇' life) as it may
deem necessary or proper; provided, however, that ▇▇▇▇▇▇' insurability or
non-insurability shall in no way affect ▇▇▇▇▇▇▇▇' obligations pursuant to this
Agreement. Any asset so purchased by ▇▇▇▇▇▇▇▇ shall be the sole property of
▇▇▇▇▇▇▇▇ and shall not be deemed to provide funding of ▇▇▇▇▇▇▇▇' obligations
under this Agreement.
(b) In the event ▇▇▇▇▇▇▇▇ determines to purchase any insurance
policy or policies on ▇▇▇▇▇▇' life, ▇▇▇▇▇▇ agrees to submit to such examination
and to supply information as may be required by the insurer.
(c) Any policy so purchased by ▇▇▇▇▇▇▇▇ shall be issued so that
▇▇▇▇▇▇▇▇ is the sole, full, and complete owner of the policy or policies, with
the right and power to exercise any and all privileges and options thereof or
available under the rules of the issuing insurer without the consent of any
other persons.
(d) ▇▇▇▇▇▇, his wife, or his widow after his death, or his
designated beneficiaries, personal representatives, heirs, successors and
assigns shall have no claim or rights with respect to, and shall have no
property or equitable interests whatsoever in, any specific funds or assets of
▇▇▇▇▇▇▇▇ and shall have only
31
32
the status of a general creditor with respect to ▇▇▇▇▇▇▇▇ hereunder.
13. FACILITY OF PAYMENT.
-------------------
In the event of a physical or mental illness or disability of ▇▇▇▇▇▇
or of his widow after his death or of his designated beneficiaries at a time
when he or she (or they) is (are) entitled to payments hereunder, such payments
as may be due shall be paid to such person or persons for the benefit of ▇▇▇▇▇▇
or his widow or his designated beneficiaries, as the case may be, as ▇▇▇▇▇▇▇▇
or, if applicable, the Escrow Agent may deem proper. In the event of ▇▇▇▇▇▇'
death after he has made demand pursuant to Section 8(e)(v) above, the Escrow
Agent shall pay such amounts as thereafter are due to such beneficiary or
beneficiaries as ▇▇▇▇▇▇ shall have designated in writing, or failing such
writing, to his estate. No liability shall accrue to ▇▇▇▇▇▇▇▇ or Escrow Agent
for any alleged payment to an improper person or representative if so made
after such reasonable investigation and ▇▇▇▇▇▇▇▇ and Escrow Agent shall have no
responsibility to see to the proper application of such payments.
14. MISCELLANEOUS PROVISIONS.
------------------------
(a) All notices required or permitted to be given under this
Agreement shall be in writing and shall be mailed, postage prepaid, by
registered or certified mail or personally delivered, if to ▇▇▇▇▇▇▇▇, addressed
to:
The ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ Company
Attention: Vice President, Corporate Finance and
Chief Financial Officer
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
32
33
and, if to ▇▇▇▇▇▇, addressed to:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Either party may change the address to which notices to such party are to be
sent by giving written notice of such change to the other party in the manner
specified in this provision.
(b) (i) This Agreement shall be binding upon ▇▇▇▇▇▇, his
wife, and upon his or her heirs, executors, administrators, designated
beneficiaries and upon anyone claiming under him or his wife or widow, and upon
▇▇▇▇▇▇▇▇ and its successor or assigns.
(ii) ▇▇▇▇▇▇▇▇ shall not merge or consolidate with any
other entity unless and until such other entity shall expressly assume
▇▇▇▇▇▇▇▇' obligations under this Agreement or ▇▇▇▇▇▇▇▇ has provided an
appropriate alternative arrangement covering its contingent liabilities under
this Agreement, and ▇▇▇▇▇▇▇▇ shall not voluntarily dissolve without first
providing an appropriate arrangement covering its contingent liabilities under
this Agreement.
(c) This Agreement may be amended, but only with the consent of
▇▇▇▇▇▇ during his lifetime and, after his death only with the consent of his
widow during her lifetime or his other designated beneficiaries during their
lifetime, as the case may be. Any agreement of amendment shall be executed
with the same formality as this Agreement.
(d) This Agreement supersedes any prior agreements or
understandings covering the subject matter hereof, either written or oral,
between the parties.
33
34
(e) This Agreement shall be construed under the laws of the State
of Ohio.
(f) The paragraph headings used in this Agreement are for
convenience of reference only and shall not be considered in construing this
Agreement.
IN WITNESS WHEREOF, the parties hereto have hereunto set their
respective hands the year and date first above written.
THE ▇▇▇▇▇▇▇▇ AND ▇▇▇▇▇▇▇▇ COMPANY
By
----------------------------------
---------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
34
35
EXHIBIT A
ESCROW AGREEMENT DATED NOVEMBER 9, 1987 BETWEEN THE ▇▇▇▇▇▇▇▇
AND ▇▇▇▇▇▇▇▇ COMPANY AND BANK ONE DAYTON, N.A., AS AMENDED AS
OF OCTOBER 1, 1995
36
AMENDMENT NO. 1
TO
ESCROW AGREEMENT
----------------
THIS AMENDMENT NO. 1 TO ESCROW AGREEMENT ("Amendment") is made and
entered into as of this 1st day of October, 1995 by and between THE ▇▇▇▇▇▇▇▇
AND ▇▇▇▇▇▇▇▇ COMPANY, an Ohio corporation (hereinafter referred to as
"▇▇▇▇▇▇▇▇"), and BANK ONE, DAYTON, NA (hereinafter referred to as the "Escrow
Agent").
WITNESSETH:
----------
WHEREAS, ▇▇▇▇▇▇▇▇ and the Bank have entered into an Escrow Agreement
dated November 9, 1987 pursuant to an Employment Agreement dated as of November
9, 1987, as amended effective May 8, 1989 and December 1, 1989, respectively
(as so amended the "November 7, 1989 Agreement") between ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇.
▇▇▇▇▇▇ ("▇▇▇▇▇▇"), an employee of ▇▇▇▇▇▇▇▇; and
WHEREAS, ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ have entered into a new Amended and
Restated Employment Agreement effective October 1, 1995 (the "Employment
Agreement"), pursuant to which ▇▇▇▇▇▇▇▇ has agreed to continue to provide
termination pay protection for ▇▇▇▇▇▇ and which provides that the required
protective payments under the Employment Agreement are to continue to be paid
into an escrow account at the Escrow Agent; and
WHEREAS, the parties hereto desire that the Escrow Agreement shall
continue in full force and effect and for the benefit of ▇▇▇▇▇▇ and with full
applicability to the Employment Agreement;
NOW, THEREFORE, in consideration of the covenants and agreements
contained in this Amendment, the parties hereby agree as follows:
1. All references to the November 9, 1987 Agreement between
▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ contained in the Escrow Agreement shall include and apply
with full force and effect to the Employment Agreement.
2. Except as set forth herein, the Escrow Agreement shall remain
unchanged and continue in full force and effect.
IN WITNESS WHEREOF, the parties hereto have hereunto set their
respective hands as of the day and year first above written.
THE ▇▇▇▇▇▇▇▇ AND ▇▇▇▇▇▇▇▇ COMPANY
By
-------------------------------
BANK ONE, DAYTON, NA
By
-------------------------------
-
37
EXHIBIT D
SCHEDULE OF FRINGE BENEFITS
PURSUANT TO SECTION 4(d)
------------------------
Benefit Amount
------- ------
Annual Physical Exam Local Clinic, maximum of $600
Auto/Gas Allowance $916 monthly
Charitable Allowance $1,000 annually to charities of his choice
Income Tax Planning and $1,000 annually
Preparation
Estate Planning and
Will Preparation
Initial Service $900
Updates $300 annually
Country Club Dues 50% annually, including initiation fee up to $3,500
Luncheon Club Dues 100% annually
Corporate aircraft (personal use) Yes; in connection with company business use ▇▇▇▇▇▇ may
include personal passengers, subject to seat availability.
▇▇▇▇▇▇ shall receive W-2 for personal use value per IRS
regulations
Vacation Five (5) weeks annually at mutually agreed times.