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EXHIBIT 10(e)
July 26, 1989
Mr. Edward W. Thoma
733 West Hamilton Avenue
Sherrill, New York 13461
Dear Mr. Thoma:
Oneida Ltd. (the
"Company") considers it essential to the best interests of its
stockholders to foster the continuous employment of key
management personnel. In this connection, the Board of
Directors of the Company (the "Board') recognizes that the
possibility of a change in control of the Company may exist
and that such possibility, and the uncertainty and questions
which it may raise among management, may result in the
departure or distraction of management personnel to the
detriment of the Company and its stockholders.
The Board has
determined that appropriate steps should be taken to reinforce
and encourage the continued attention and dedication of
members of the Company's management, including yourself, to
their assigned duties without distraction in the face of
potentially disturbing circumstances arising from any possible
change in control of the Company.
In order to induce you
to remain in the employ of the Company, the Company agrees
that you shall receive the severance benefits set forth in
this letter agreement (the "Agreement") in the event that your
employment with the Company is terminated subsequent to a
Change in Control (as defined in Section 2).
1. Term of Agreement.
The term of this Agreement (the "Term") shall commence on the
Operative Date (as hereinafter defined) and end on the fifth
anniversary of the Operative Date, provided that it has not
been terminated in accordance with its terms. In the event,
however, that you attain the age of sixty-five (65) during the
Term, then this Agreement shall terminate on the last day of
the month in which you attain the age of sixty-five (65). For
purposes of this Agreement, the term "Operative Date" shall
mean the date on which a Change in Control occurs, provided
that (i) you are then in the employ of the Company and (ii)
such Change in Control occurs before you reach age sixty -five
(65).
2. Change in Control.
No benefits shall be payable hereunder unless there shall have
been a Change in Control. For purposes of this Agreement, a
"Change in Control" shall be deemed to have occurred if:
(A) 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 the Company, any trustee or other fiduciary
holding securities under an employee benefit plan of the
Company, or any company owned, directly or indirectly, by the
stockholders of the Company in substantially the same
proportions as their ownership of sock of the Company), is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act, directly or indirectly, of securities of the
Company representing 20% or more of the combined voting power
of the Company's then outstanding securities;
(B) 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, and any new
director (other than a director designated by a person who has
entered into an agreement with the Company to effect a
transaction described in clause (A), (C) or (D) of this
Section) whose election by the Board or nomination for
election by the Company's stockholders 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 or nomination for election was
previously so approved, cease for any reason to constitute at
least a majority thereof;
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(C) the stockholders
of the Company approve a merger or consolidation of the
Company with any other company, other than (1) a merger or
consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing
to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) more
than 50% of the combined voting power of the voting securities
of the Company or such surviving entity outstanding
immediately after such merger or consolidation or (2) a merger
or consolidation effected to implement a recapitalization of
the Company (or similar transaction in which no ''person" (as
hereinabove defined) acquires more than 20% of the combined
voting power of the Company's then outstanding securities; or
(D) the stockholders
of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the
Company of all or Substantially all of the Company's assets.
3. Termination
Following Change in Control. If a Change in Control shall have
occurred, you shall be entitled to the benefits provided in
Subsection 4(D) upon the subsequent termination of your
employment during the Term unless such termination is because
of your death or retirement, by the Company for cause or
disability, or by you other than for good reason. In the event
your employment with the Company is terminated for any reason
prior to the Operative Date, you shall not be entitled to any
benefits hereunder.
(A) Disability;
Retirement. If, as a result of your incapacity due to physical
or mental illness, you shall have been absent from the
full-time performance of your duties with the Company for six
(6) consecutive months, and within thirty (30) days after
written Notice of Termination (as defined in Subsection 3(D))
is given you shall not have returned to the full-time
performance of your duties, the Company may terminate your
employment for "Disability." Any question as to the existence
of your Disability upon which you and the Company cannot agree
shall be determined by a qualified independent physician
selected by you (or, if you are unable to make such selection,
it shall be made by any adult member of your immediate
family), and approved by the Company. The determination of
such physician made in writing to the Company and to you shall
be final and conclusive for all purposes of this Agreement.
Termination of your employment based on "Retirement" shall
mean your voluntary termination of employment on a Retirement
Date as defined in the Retirement Plan for Employees of Oneida
Ltd. or any successor plan thereto (the "Pension Plan") as in
effect immediately prior to the occurrence of a Change in
Control (whether or not you are a participant in the Pension
Plan) or in accordance with any retirement arrangement
established with your consent with respect to you.
(B) Cause. Termination
by the Company of your employment for "Cause" shall mean
termination upon (i) the willful and continued failure by you
to substantially perform your duties with the Company (other
than any such failure resulting from your incapacity due to
physical or mental illness or from your Retirement or any such
actual or anticipated failure resulting from termination by
you for Good Reason (as hereinafter defined after a written
demand for substantial performance is delivered to you by the
Board, which demand specifically identifies the manner in
which the Board believes that you have not substantially
performed your duties, or (ii) the willful engaging by you in
conduct which is demonstrably and materially injurious to the
Company, monetarily or otherwise. For purposes of this
Subsection, no act or failure to act on your part shall be
deemed ''willful'' unless done, or omitted to be done, by you
in other than good faith and without reasonable belief that
your action or omission was in the best interests of the
Company. Notwithstanding the foregoing, you shall not be
deemed to have been terminated for Cause unless and until
there shall have been delivered to you a copy of a resolution
duly adopted by the affirmative vote of not less than
three-quarters (3/4) of the entire membership of the Board at
a meeting of the Board (after reasonable notice to you and an
opportunity for you, together with your counsel, to be heard
before the Board), finding that in the good faith opinion of
the Board you were guilty of conduct set forth above in clause
(i) or (ii) of the first sentence of this Subsection and
specifying the particulars thereof in detail.
(C) Good Reason. You
shall be entitled to terminate your employment for Good
Reason. For purposes of this Agreement, "Good Reason" shall
mean, without your express written consent, the occurrence
after a Change in Control of any of the following
circumstances:
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(i) Inconsistent
Duties. A meaningful and detrimental alteration in your
position or in the nature or status of your responsibilities
(including those as a director of the Company, if any) from
those in effect immediately prior to the Change in Control;
(ii) Reduced Salary or Failure to Increase
Salary. A reduction by the Company in your annual base salary
as in effect on the date hereof or as the same may be
increased from time to time; a failure by the Company to
increase your salary at a rate commensurate with that of other
key executives of the Company; or a failure by the Company to
increase your salary on an annual basis to reflect the
percentage increase in the cost of living (as determined in
accordance with such statistics or indices as the Board shall
reasonably consider appropriate for such purposes).
(iii) Relocation. The relocation of the office
of the Company where you are employed at the time of the
Change in Control (the "CIC Location") to a location which in
your good faith assessment is an area not generally considered
conducive to maintaining the executive offices of a company
such as the Company because of hazardous or undesirable
conditions, including, without limitation, a high crime rate
or inadequate facilities, or to a location which is more than
twenty-five (25) miles away from the CIC Location or the
Company's requiring you to be based more than twenty-five (25)
miles away from the CIC Location (except for required travel
on the Company's business to an extent substantially
consistent with your present business travel obligations);
(iv) Compensation Plans. The failure by the
Company to continue in effect any material compensation,
benefit or profit sharing plan in which you were participating
immediately prior to the Change in Control, unless an
equitable arrangement (embodied in an ongoing substitute or
alternative plan) has been made with respect to such plan, or
the failure by the Company to continue your participation
therein (or in such substitute or alternative plan) on at
least as favorable a basis, both in terms of the amount of
benefits provided and the level of your participation relative
to other participants, as existed immediately prior to the
Change in Control;
(v) Benefits and
Perquisites. The failure by the Company to continue to provide
you with benefits at least as favorable as those enjoyed by
you under any of the Company's pension, life insurance,
medical, health and accident, disability or savings plans in
which you were participating immediately prior to the Change
in Control; the taking of any action by the Company which
would directly or indirectly materially reduce any of such
benefits or deprive you of any material benefit or perquisite
enjoyed by you immediately prior to the Change in Control; or
the failure by the Company to provide you with the number of
paid vacation days to which you are entitled on the basis of
years of service with the Company in accordance with the
Company's normal vacation policy in effect immediately prior
to the Change in Control;
(vi) No Assumption by Successor. The failure
of the Company to obtain a satisfactory agreement from any
successor to assume and agree to perform this Agreement, as
contemplated in Section 5 hereof or, if the business of the
Company for which your services are principally performed is
sold at any time after a Change in Control, the failure of the
purchaser of such business to agree to provide you with the
same or a comparable position, duties, compensation, benefits
and perquisites (as described in clauses (iv) and (v) above)
as provided to you by the Company immediately prior to the
Change in Control; or
(vii) No Notice. Any purported termination of
your employment that is not effected pursuant to a Notice of
Termination satisfying the requirements of Subsection (D)
below (and, if applicable, the requirements of Subsection (B)
above), which purported termination shall not be effective for
purposes of this Agreement.
(D) Notice of
Termination. Any purported termination of your employment by
the Company or by you shall be communicated by written Notice
of Termination to the other party hereto in accordance with
Section 6. For purposes of his Agreement, a "Notice of
Termination" shall mean a notice that shall indicate the
specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of
your employment under the provision so indicated.
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(E) Date of
Termination, Etc. For purposes of this Agreement, "Date of
Termination' shall mean (i) if your employment is terminated
for Disability, thirty (30) days after a Notice of Termination
is given (provided that you shall not have returned to the
full-time performance of your duties during such thirty (30)
day period), and (ii) if your employment is terminated
pursuant to Subsection (B) or (C) above or for any other
reason (other than Disability), the date specified in the
Notice of Termination (which, in the case of a termination
pursuant to Subsection B) above shall not be less than thirty
(30) days from the date such Notice of Termination is given,
and in the case of a termination pursuant to Subsection (C)
above shall not be less than thirty (30) nor more than sixty
(60) days from the date such Notice of Termination is given);
provided, however, that if within thirty (30) days after any
Notice of Termination is given, the party receiving such
Notice of Termination. notifies the other party that a dispute
exists concerning the termination, the Date of Termination
shall be the date on which the dispute is finally determined,
either by mutual written agreement of the parties, by a
binding arbitration award, or by a final judgment, order or
decree of a court of competent jurisdiction (which is not
appealable or the time for appeal therefrom having expired and
no appeal having been perfected); provided further, however,
that the Date of Termination shall be extended by a notice of
dispute only if such notice is given in good faith and the
party giving such notice pursues the resolution of such
dispute with reasonable diligence. Notwithstanding the
pendency of any such dispute, the Company will continue to pay
you your full compensation in effect when the notice giving
rise to the dispute was given and continue you as a
participant in all compensation, benefit and insurance plans
and perquisites in which you were participating when the
notice giving rise to the dispute was given, until the dispute
is finally resolved in accordance with this Subsection.
Amounts paid under this Subsection are in addition to all
other amounts due under this Agreement and shall not be offset
against or reduce any other amounts due under this Agreement
and shall not be reduced by any compensation earned by you as
the result of employment by another employer.
4. Compensation Upon
Termination or During Disability. Following a Change in
Control, you shall be entitled to the following benefits
during a period of Disability, or upon termination of your
employment, as the case may be, provided that such period or
termination occurs during the Term:
(A) Disability. During
any period that you fail to perform your full-time duties with
the Company as a result of your Disability, you shall continue
to receive your base salary at the rate in effect at the
commencement of any such period, together with compensation
payable to you under the Company's disability insurance
coverage or other plan during such period, until your
employment is terminated pursuant to Subsection 3(A).
Thereafter, your benefits shall be determined in accordance
with the Company's insurance programs and other benefit or
pension plans then in effect in accordance with the terms of
such programs and plans.
(B) Termination for
Other than Good Reason or for Cause. If your employment shall
be terminated by the Company for Cause or by you other than
for Good Reason, death or Retirement, the Company shall pay
you your full base salary through the Date of Termination at
the rate in effect at the time the Notice of Termination is
given, plus all other amounts to which you are entitled
pursuant to the Company's benefit and pension plans then in
effect, and the Company shall have no further obligations to
you under this Agreement.
(C) Retirement; Death.
If your employment shall be terminated for Retirement, or by
reason of your death, your benefits shall be determined in
accordance with the Company's benefit and pension plans then
in effect.
(D) Breach by the
Company. If your employment by the Company shall be terminated
by the Company other than for Cause, Retirement or Disability
or by you for Good Reason, then you shall be entitled to the
benefits provided below:
(i) Base Salary. The
Company shall pay you your full base salary through the Date
of Termination at the rate in effect at the time the Notice of
Termination is given;
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(ii) Severance Payment. In lieu of any further
salary payments to you for periods subsequent to the Date of
Termination, the Company shall pay as severance pay to you,
not later than the tenth (10th) business day following the
Date of Termination, a lump sum severance payment equal to
2.99 times the average of the annual compensation which was
payable to you by the Company (or any corporation affiliated
with the Company within the meaning of section 1504 of the
Internal Revenue Code of 1986, as amended (the "Code"),
determined without regard to section 1504(b) of the Code) and
includable in your gross income for Federal income tax
purposes for the five (5) taxable years preceding your taxable
year in which a Change in Control occurred. The amount of your
average annual compensation shall be determined in accordance
with the regulations (including proposed regulations)
promulgated under section 280G(d) of the Code; provided,
however, that (a) notwithstanding any provision of such
regulations to the contrary, the amount of your average annual
compensation shall be determined by including as compensation
any contribution (a "401(k) Contribution") pursuant to any
cash or deferred arrangement (as described in section 401(k)
of the Code) maintained by the Company which is not includable
in your gross income under section 402(a)(8) of the Code and
(b) the amount of any such 401(k) Contribution shall be
treated as includable in your gross income in the taxable year
such contribution is made for purposes of the preceding
sentence.
(iii) Legal Fees and
Expenses. The Company shall also pay to you all legal fees
and expenses incurred by you as a result of such termination,
including all such fees and expenses, if any, incurred in
contesting or disputing any such termination or in seeking to
obtain or enforce any right or benefit provided by this
Agreement (other than any such fees or expenses incurred in
connection with any such claim which is determined to be
frivolous).
(iv) Insurance Benefits for 36 Months. For a
thirty-six (36) month period after such termination, the
Company shall arrange to provide you with life, disability,
accident and health insurance benefits substantially similar
to and at no greater cost to you than those which you were
receiving immediately prior to the Notice of Termination.
Benefits otherwise receivable by you pursuant to this
Subsection 4(D)(iv) shall be reduced to the extent comparable
benefits are actually received by you during the thirty-six
(36) month period following your termination, and any such
benefits actually received by you shall be reported to the
Company.
(v) Supplemental
Pension. In addition to the Pension benefits to which you are
entitled under the Pension Plan, the Company shall pay you in
one sum in cash on the tenth (10th) business day following the
Date of Termination, a lump sum equal to the actuarial
equivalent of the excess of (1) the retirement pension
(determined as a straight life annuity commencing at age 65)
which you would have accrued under the terms of the Pension
Plan and any other pension benefit program (without regard to
any amendment to such Pension Plan or other pension benefit
program made subsequent to the Change in Control and on or
prior to the Date of Termination, which amendment adversely
affects in any manner the computation of pension benefits
thereunder), determined as if you were fully vested thereunder
and had accumulated (after the Date of Termination thirty-six
(36) additional months of service credit thereunder at your
highest annual rate of compensation (the "Compensation Rate")
during the twelve (12) months immediately preceding the Date
of Termination (but in no event shall you be deemed to have
accumulated additional months of service credit after your
sixty-fifth (65th) birthday), over (2) the retirement pension
(determined as a straight life annuity commencing at age
sixty-five (65)) which you had then accrued pursuant to the
provisions of the Pension Plan and any other pension benefit
program. For purposes of clause (1) above, the Compensation
Rate shall be deemed to include amounts payable pursuant to
Subsection 4(D)(ii) hereof, and amounts payable pursuant to
Subsection 4(D)(ii) hereof shall be deemed to represent
thirty-six (36) months of compensation (or such lesser number
of months of compensation to your sixty-fifth (65th) birthday)
for purposes of determining benefits under the Pension Plan.
For purposes of this Subsection, "actuarial equivalent" shall
be determined using the same methods and assumptions utilized
under the Pension Plan immediately prior to the Change in
Control.
(vi) Employee Benefit
Plans. You shall be entitled to receive all benefits payable
to you under the Company's benefit and pension plans, not
otherwise specifically provided for in this Subsection 4(D).
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(E) No Mitigation.
You shall not be required to mitigate the amount of any
payment provided for in this Section 4 by seeking other
employment or otherwise, nor shall the amount of any payment
or benefit provided for in this Section 4 be reduced by any
compensation earned by you as the result of employment by
another employer or by pension benefits after the Date of
Termination, or otherwise except as specifically provided in
this Section 4.
(F) Reduction of
Payments In Certain Cases. Notwithstanding anything herein to
the contrary, if any amounts due to you under this Agreement
and any other plan or program of the Company constitute a
"parachute payment," 2S such term is defined in Section
280G(b)(2) of the Code (the "Parachute Payment"), and the
amount of the Parachute Payment, reduced by all federal, state
and local taxes applicable thereto, including the excise tax
imposed pursuant to Section 4999 of the Code, is less than the
amount you would receive if you were paid three times your
"base amount," as defined in Section 280G(b)(3) of the Code,
less $1.00, reduced by all federal, state and local taxes
applicable thereto, then the aggregate of the amounts
constituting the Parachute Payment shall be reduced to an
amount that will equal three times your base amount less
$1.00. The determinations to be made with respect to this
Subsection 4(F) shall be made by an accounting firm (the
"Auditor") jointly selected by the Company and you and paid by
the Company. The Auditor shall be a nationally recognized
United States public accounting firm that has not during the
two years preceding the date of its selection acted in any way
on behalf of the Company or any of its subsidiaries. If you
and the Company cannot agree on the accounting firm to serve
as the Auditor, then you and the Company shall each select one
accounting firm, which two firms shall jointly select the
accounting firm to serve as the Auditor. If the Auditor
determines that a reduction in the aggregate of the amounts
constituting the Parachute Payment is required by this
Subsection (F), you shall have the right to specify the
portion of such reduction, if any, that will be made under
this Agreement and each applicable plan or program of the
Company, respectively. If you do not so specify within, 60
days following the date of a determination by the Auditor
pursuant to the preceding sentence, the Company shall
determine, in its sole discretion, the portion of such
reduction, if any, to be made under this Agreement and each
applicable plan or program of the Company, respectively.
5. Successors; Binding
Agreement. (A) Assumption By Successor. The Company will
require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company
to expressly assume and agree to perform this Agreement in the
same manner and to the same extent that the Company would be
required to perform it if no such succession had taken place.
Failure of the Company to obtain such assumption and agreement
prior to the effectiveness of any such succession shall be a
breach of this Agreement and shall entitle you to compensation
from the Company in the same amount and on the same terms as
you would be entitled hereunder if you had terminated your
employment for Good Reason following a Change in Control,
except that for purposes of implementing the foregoing, the
date on which any such succession becomes effective shall be
deemed the Date of Termination. As used in this Agreement,
"the Company" shall mean the Company as hereinbefore defined
and any successor to its business and/or assets as aforesaid
which assumes and agrees to perform this Agreement by
operation of law, or otherwise.
(B) Enforceability By
Beneficiaries. This Agreement shall inure to the benefit of
and be enforceable by your personal or legal representatives,
executors, administrators, successors, heirs, distributees,
devisees and legatees. If you should die while any amount
would still be payable to you hereunder had you continued to
live, all such amounts, unless otherwise provided herein,
shall be paid in accordance with the terms of this Agreement
to your devisee, legatee or other designee or, if there is no
such designee, to your estate.
6. Notice. For
purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in
writing and shall be deemed to have been duly given when
delivered or mailed by United States certified or registered
mail, return receipt requested, postage prepaid, addressed to
the respective parties as follows:
If to the Company: Secretary
Oneida Ltd.
Oneida, New York 13421
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If to you: Edward W. Thoma
33 West Hamilton Avenue
Sherrill, New York 13461
or to such other address as either party may have furnished to
the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon
receipt.
7. Miscellaneous. No
provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is
agreed to in writing. No waiver by either party hereto at any
time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be
performed by such other arty shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or
at any prior or subsequent time. No agreements or
representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either
party which are not expressly set forth in this Agreement, and
this Agreement shall supersede all Prior agreements,
negotiations, correspondence, undertakings and communications
of the parties, oral or written, with respect to the subject
matter hereof. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of
the State of New York.
8. Validity. The
invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in
full force and effect.
9. Counterparts. This
Agreement may be executed in several counterparts, each of
which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
10. Arbitration. Any
dispute or controversy arising under or in connection with
this Agreement shall be settled exclusively by arbitration
conducted in the State of New York in accordance with the
rules of the American Arbitration Association then in effect.
Judgment may be entered on the arbitrator's award in any court
having jurisdiction; provided, however, that you shall be
entitled to seek specific performance of your right to be paid
until the Date of Termination during the pendency of any
dispute or controversy arising under or in connection with
this Agreement.
11. No Contract of
Employment. Nothing in this Agreement shall be construed as
giving you any right to be retained in the employ of the
Company.
12. Headings. The
headings contained in this Agreement are intended solely for
convenience and shall not affect the rights of the parties to
this Agreement.
If this letter sets
forth our agreement on the subject matter hereof, kindly sign
and return to the Company the enclosed copy of this letter,
which will then constitute our agreement on this subject.
Sincerely,
ONEIDA LTD.
By /s/ William D. Matthews
Name: William D. Matthews
Title: Chairman of the Board
and President
Agreed to this 26th day of July, 1989
/s/ Edward W. Thoma
Edward W. Thoma
July 26, 1989
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July 26, 1989
Mr. Gary L. Moreau
2028 Syosset Drive
Cazenovia, New York 13035
Dear Mr. Moreau:
Oneida Ltd. (the
"Company") considers it essential to the best interests of its
stockholders to foster the continuous employment of key
management personnel. In this connection, the Board of
Directors of the Company (the "Board') recognizes that the
possibility of a change in control of the Company may exist
and that such possibility, and the uncertainty and questions
which it may raise among management, may result in the
departure or distraction of management personnel to the
detriment of the Company and its stockholders.
The Board has
determined that appropriate steps should be taken to reinforce
and encourage the continued attention and dedication of
members of the Company's management, including yourself, to
their assigned duties without distraction in the face of
potentially disturbing circumstances arising from any possible
change in control of the Company.
In order to induce you
to remain in the employ of the Company, the Company agrees
that you shall receive the severance benefits set forth in
this letter agreement (the "Agreement") in the event that your
employment with the Company is terminated subsequent to a
Change in Control (as defined in Section 2).
1. Term of Agreement.
The term of this Agreement (the "Term") shall commence on the
Operative Date (as hereinafter defined) and end on the fifth
anniversary of the Operative Date, provided that it has not
been terminated in accordance with its terms. In the event,
however, that you attain the age of sixty-five (65) during the
Term, then this Agreement shall terminate on the last day of
the month in which you attain the age of sixty-five (65). For
purposes of this Agreement, the term "Operative Date" shall
mean the date on which a Change in Control occurs, provided
that (i) you are then in the employ of the Company and (ii)
such Change in Control occurs before you reach age sixty -five
(65).
2. Change in Control.
No benefits shall be payable hereunder unless there shall have
been a Change in Control. For purposes of this Agreement, a
"Change in Control" shall be deemed to have occurred if:
(A) 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 the Company, any trustee or other fiduciary
holding securities under an employee benefit plan of the
Company, or any company owned, directly or indirectly, by the
stockholders of the Company in substantially the same
proportions as their ownership of sock of the Company), is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act, directly or indirectly, of securities of the
Company representing 20% or more of the combined voting power
of the Company's then outstanding securities;
(B) 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, and any new
director (other than a director designated by a person who has
entered into an agreement with the Company to effect a
transaction described in clause (A), (C) or (D) of this
Section) whose election by the Board or nomination for
election by the Company's stockholders 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 or nomination for election was
previously so approved, cease for any reason to constitute at
least a majority thereof;
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(C) the stockholders
of the Company approve a merger or consolidation of the
Company with any other company, other than (1) a merger or
consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing
to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) more
than 50% of the combined voting power of the voting securities
of the Company or such surviving entity outstanding
immediately after such merger or consolidation or (2) a merger
or consolidation effected to implement a recapitalization of
the Company (or similar transaction in which no ''person" (as
hereinabove defined) acquires more than 20% of the combined
voting power of the Company's then outstanding securities; or
(D) the stockholders
of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the
Company of all or Substantially all of the Company's assets.
3. Termination
Following Change in Control. If a Change in Control shall have
occurred, you shall be entitled to the benefits provided in
Subsection 4(D) upon the subsequent termination of your
employment during the Term unless such termination is because
of your death or retirement, by the Company for cause or
disability, or by you other than for good reason. In the event
your employment with the Company is terminated for any reason
prior to the Operative Date, you shall not be entitled to any
benefits hereunder.
(A) Disability;
Retirement. If, as a result of your incapacity due to physical
or mental illness, you shall have been absent from the
full-time performance of your duties with the Company for six
(6) consecutive months, and within thirty (30) days after
written Notice of Termination (as defined in Subsection 3(D))
is given you shall not have returned to the full-time
performance of your duties, the Company may terminate your
employment for "Disability." Any question as to the existence
of your Disability upon which you and the Company cannot agree
shall be determined by a qualified independent physician
selected by you (or, if you are unable to make such selection,
it shall be made by any adult member of your immediate
family), and approved by the Company. The determination of
such physician made in writing to the Company and to you shall
be final and conclusive for all purposes of this Agreement.
Termination of your employment based on "Retirement" shall
mean your voluntary termination of employment on a Retirement
Date as defined in the Retirement Plan for Employees of Oneida
Ltd. or any successor plan thereto (the "Pension Plan") as in
effect immediately prior to the occurrence of a Change in
Control (whether or not you are a participant in the Pension
Plan) or in accordance with any retirement arrangement
established with your consent with respect to you.
(B) Cause. Termination
by the Company of your employment for "Cause" shall mean
termination upon (i) the willful and continued failure by you
to substantially perform your duties with the Company (other
than any such failure resulting from your incapacity due to
physical or mental illness or from your Retirement or any such
actual or anticipated failure resulting from termination by
you for Good Reason (as hereinafter defined after a written
demand for substantial performance is delivered to you by the
Board, which demand specifically identifies the manner in
which the Board believes that you have not substantially
performed your duties, or (ii) the willful engaging by you in
conduct which is demonstrably and materially injurious to the
Company, monetarily or otherwise. For purposes of this
Subsection, no act or failure to act on your part shall be
deemed ''willful'' unless done, or omitted to be done, by you
in other than good faith and without reasonable belief that
your action or omission was in the best interests of the
Company. Notwithstanding the foregoing, you shall not be
deemed to have been terminated for Cause unless and until
there shall have been delivered to you a copy of a resolution
duly adopted by the affirmative vote of not less than
three-quarters (3/4) of the entire membership of the Board at
a meeting of the Board (after reasonable notice to you and an
opportunity for you, together with your counsel, to be heard
before the Board), finding that in the good faith opinion of
the Board you were guilty of conduct set forth above in clause
(i) or (ii) of the first sentence of this Subsection and
specifying the particulars thereof in detail.
(C) Good Reason. You
shall be entitled to terminate your employment for Good
Reason. For purposes of this Agreement, "Good Reason" shall
mean, without your express written consent, the occurrence
after a Change in Control of any of the following
circumstances:
95
(i) Inconsistent
Duties. A meaningful and detrimental alteration in your
position or in the nature or status of your responsibilities
(including those as a director of the Company, if any) from
those in effect immediately prior to the Change in Control;
(ii) Reduced Salary or Failure to Increase
Salary. A reduction by the Company in your annual base salary
as in effect on the date hereof or as the same may be
increased from time to time; a failure by the Company to
increase your salary at a rate commensurate with that of other
key executives of the Company; or a failure by the Company to
increase your salary on an annual basis to reflect the
percentage increase in the cost of living (as determined in
accordance with such statistics or indices as the Board shall
reasonably consider appropriate for such purposes).
(iii) Relocation. The relocation of the office
of the Company where you are employed at the time of the
Change in Control (the "CIC Location") to a location which in
your good faith assessment is an area not generally considered
conducive to maintaining the executive offices of a company
such as the Company because of hazardous or undesirable
conditions, including, without limitation, a high crime rate
or inadequate facilities, or to a location which is more than
twenty-five (25) miles away from the CIC Location or the
Company's requiring you to be based more than twenty-five (25)
miles away from the CIC Location (except for required travel
on the Company's business to an extent substantially
consistent with your present business travel obligations);
(iv) Compensation Plans. The failure by the
Company to continue in effect any material compensation,
benefit or profit sharing plan in which you were participating
immediately prior to the Change in Control, unless an
equitable arrangement (embodied in an ongoing substitute or
alternative plan) has been made with respect to such plan, or
the failure by the Company to continue your participation
therein (or in such substitute or alternative plan) on at
least as favorable a basis, both in terms of the amount of
benefits provided and the level of your participation relative
to other participants, as existed immediately prior to the
Change in Control;
(v) Benefits and
Perquisites. The failure by the Company to continue to provide
you with benefits at least as favorable as those enjoyed by
you under any of the Company's pension, life insurance,
medical, health and accident, disability or savings plans in
which you were participating immediately prior to the Change
in Control; the taking of any action by the Company which
would directly or indirectly materially reduce any of such
benefits or deprive you of any material benefit or perquisite
enjoyed by you immediately prior to the Change in Control; or
the failure by the Company to provide you with the number of
paid vacation days to which you are entitled on the basis of
years of service with the Company in accordance with the
Company's normal vacation policy in effect immediately prior
to the Change in Control;
(vi) No Assumption by Successor. The failure
of the Company to obtain a satisfactory agreement from any
successor to assume and agree to perform this Agreement, as
contemplated in Section 5 hereof or, if the business of the
Company for which your services are principally performed is
sold at any time after a Change in Control, the failure of the
purchaser of such business to agree to provide you with the
same or a comparable position, duties, compensation, benefits
and perquisites (as described in clauses (iv) and (v) above)
as provided to you by the Company immediately prior to the
Change in Control; or
(vii) No Notice. Any purported termination of
your employment that is not effected pursuant to a Notice of
Termination satisfying the requirements of Subsection (D)
below (and, if applicable, the requirements of Subsection (B)
above), which purported termination shall not be effective for
purposes of this Agreement.
(D) Notice of
Termination. Any purported termination of your employment by
the Company or by you shall be communicated by written Notice
of Termination to the other party hereto in accordance with
Section 6. For purposes of his Agreement, a "Notice of
Termination" shall mean a notice that shall indicate the
specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of
your employment under the provision so indicated.
96
(E) Date of
Termination, Etc. For purposes of this Agreement, "Date of
Termination' shall mean (i) if your employment is terminated
for Disability, thirty (30) days after a Notice of Termination
is given (provided that you shall not have returned to the
full-time performance of your duties during such thirty (30)
day period), and (ii) if your employment is terminated
pursuant to Subsection (B) or (C) above or for any other
reason (other than Disability), the date specified in the
Notice of Termination (which, in the case of a termination
pursuant to Subsection B) above shall not be less than thirty
(30) days from the date such Notice of Termination is given,
and in the case of a termination pursuant to Subsection (C)
above shall not be less than thirty (30) nor more than sixty
(60) days from the date such Notice of Termination is given);
provided, however, that if within thirty (30) days after any
Notice of Termination is given, the party receiving such
Notice of Termination. notifies the other party that a dispute
exists concerning the termination, the Date of Termination
shall be the date on which the dispute is finally determined,
either by mutual written agreement of the parties, by a
binding arbitration award, or by a final judgment, order or
decree of a court of competent jurisdiction (which is not
appealable or the time for appeal therefrom having expired and
no appeal having been perfected); provided further, however,
that the Date of Termination shall be extended by a notice of
dispute only if such notice is given in good faith and the
party giving such notice pursues the resolution of such
dispute with reasonable diligence. Notwithstanding the
pendency of any such dispute, the Company will continue to pay
you your full compensation in effect when the notice giving
rise to the dispute was given and continue you as a
participant in all compensation, benefit and insurance plans
and perquisites in which you were participating when the
notice giving rise to the dispute was given, until the dispute
is finally resolved in accordance with this Subsection.
Amounts paid under this Subsection are in addition to all
other amounts due under this Agreement and shall not be offset
against or reduce any other amounts due under this Agreement
and shall not be reduced by any compensation earned by you as
the result of employment by another employer.
4. Compensation Upon
Termination or During Disability. Following a Change in
Control, you shall be entitled to the following benefits
during a period of Disability, or upon termination of your
employment, as the case may be, provided that such period or
termination occurs during the Term:
(A) Disability. During
any period that you fail to perform your full-time duties with
the Company as a result of your Disability, you shall continue
to receive your base salary at the rate in effect at the
commencement of any such period, together with compensation
payable to you under the Company's disability insurance
coverage or other plan during such period, until your
employment is terminated pursuant to Subsection 3(A).
Thereafter, your benefits shall be determined in accordance
with the Company's insurance programs and other benefit or
pension plans then in effect in accordance with the terms of
such programs and plans.
(B) Termination for
Other than Good Reason or for Cause. If your employment shall
be terminated by the Company for Cause or by you other than
for Good Reason, death or Retirement, the Company shall pay
you your full base salary through the Date of Termination at
the rate in effect at the time the Notice of Termination is
given, plus all other amounts to which you are entitled
pursuant to the Company's benefit and pension plans then in
effect, and the Company shall have no further obligations to
you under this Agreement.
(C) Retirement; Death.
If your employment shall be terminated for Retirement, or by
reason of your death, your benefits shall be determined in
accordance with the Company's benefit and pension plans then
in effect.
(D) Breach by the
Company. If your employment by the Company shall be terminated
by the Company other than for Cause, Retirement or Disability
or by you for Good Reason, then you shall be entitled to the
benefits provided below:
(i) Base Salary. The
Company shall pay you your full base salary through the Date
of Termination at the rate in effect at the time the Notice of
Termination is given;
97
(ii) Severance Payment. In lieu of any further
salary payments to you for periods subsequent to the Date of
Termination, the Company shall pay as severance pay to you,
not later than the tenth (10th) business day following the
Date of Termination, a lump sum severance payment equal to
2.99 times the average of the annual compensation which was
payable to you by the Company (or any corporation affiliated
with the Company within the meaning of section 1504 of the
Internal Revenue Code of 1986, as amended (the "Code"),
determined without regard to section 1504(b) of the Code) and
includable in your gross income for Federal income tax
purposes for the five (5) taxable years preceding your taxable
year in which a Change in Control occurred. The amount of your
average annual compensation shall be determined in accordance
with the regulations (including proposed regulations)
promulgated under section 280G(d) of the Code; provided,
however, that (a) notwithstanding any provision of such
regulations to the contrary, the amount of your average annual
compensation shall be determined by including as compensation
any contribution (a "401(k) Contribution") pursuant to any
cash or deferred arrangement (as described in section 401(k)
of the Code) maintained by the Company which is not includable
in your gross income under section 402(a)(8) of the Code and
(b) the amount of any such 401(k) Contribution shall be
treated as includable in your gross income in the taxable year
such contribution is made for purposes of the preceding
sentence.
(iii) Legal Fees and
Expenses. The Company shall also pay to you all legal fees
and expenses incurred by you as a result of such termination,
including all such fees and expenses, if any, incurred in
contesting or disputing any such termination or in seeking to
obtain or enforce any right or benefit provided by this
Agreement (other than any such fees or expenses incurred in
connection with any such claim which is determined to be
frivolous).
(iv) Insurance Benefits for 36 Months. For a
thirty-six (36) month period after such termination, the
Company shall arrange to provide you with life, disability,
accident and health insurance benefits substantially similar
to and at no greater cost to you than those which you were
receiving immediately prior to the Notice of Termination.
Benefits otherwise receivable by you pursuant to this
Subsection 4(D)(iv) shall be reduced to the extent comparable
benefits are actually received by you during the thirty-six
(36) month period following your termination, and any such
benefits actually received by you shall be reported to the
Company.
(v) Supplemental
Pension. In addition to the Pension benefits to which you are
entitled under the Pension Plan, the Company shall pay you in
one sum in cash on the tenth (10th) business day following the
Date of Termination, a lump sum equal to the actuarial
equivalent of the excess of (1) the retirement pension
(determined as a straight life annuity commencing at age 65)
which you would have accrued under the terms of the Pension
Plan and any other pension benefit program (without regard to
any amendment to such Pension Plan or other pension benefit
program made subsequent to the Change in Control and on or
prior to the Date of Termination, which amendment adversely
affects in any manner the computation of pension benefits
thereunder), determined as if you were fully vested thereunder
and had accumulated (after the Date of Termination thirty-six
(36) additional months of service credit thereunder at your
highest annual rate of compensation (the "Compensation Rate")
during the twelve (12) months immediately preceding the Date
of Termination (but in no event shall you be deemed to have
accumulated additional months of service credit after your
sixty-fifth (65th) birthday), over (2) the retirement pension
(determined as a straight life annuity commencing at age
sixty-five (65)) which you had then accrued pursuant to the
provisions of the Pension Plan and any other pension benefit
program. For purposes of clause (1) above, the Compensation
Rate shall be deemed to include amounts payable pursuant to
Subsection 4(D)(ii) hereof, and amounts payable pursuant to
Subsection 4(D)(ii) hereof shall be deemed to represent
thirty-six (36) months of compensation (or such lesser number
of months of compensation to your sixty-fifth (65th) birthday)
for purposes of determining benefits under the Pension Plan.
For purposes of this Subsection, "actuarial equivalent" shall
be determined using the same methods and assumptions utilized
under the Pension Plan immediately prior to the Change in
Control.
(vi) Employee Benefit
Plans. You shall be entitled to receive all benefits payable
to you under the Company's benefit and pension plans, not
otherwise specifically provided for in this Subsection 4(D).
98
(E) No Mitigation. You
shall not be required to mitigate the amount of any payment
provided for in this Section 4 by seeking other employment or
otherwise, nor shall the amount of any payment or benefit
provided for in this Section 4 be reduced by any compensation
earned by you as the result of employment by another employer
or by pension benefits after the Date of Termination, or
otherwise except as specifically provided in this Section 4.
(F) Reduction of
Payments In Certain Cases. Notwithstanding anything herein to
the contrary, if any amounts due to you under this Agreement
and any other plan or program of the Company constitute a
"parachute payment," 2S such term is defined in Section
280G(b)(2) of the Code (the "Parachute Payment"), and the
amount of the Parachute Payment, reduced by all federal, state
and local taxes applicable thereto, including the excise tax
imposed pursuant to Section 4999 of the Code, is less than the
amount you would receive if you were paid three times your
"base amount," as defined in Section 280G(b)(3) of the Code,
less $1.00, reduced by all federal, state and local taxes
applicable thereto, then the aggregate of the amounts
constituting the Parachute Payment shall be reduced to an
amount that will equal three times your base amount less
$1.00. The determinations to be made with respect to this
Subsection 4(F) shall be made by an accounting firm (the
"Auditor") jointly selected by the Company and you and paid by
the Company. The Auditor shall be a nationally recognized
United States public accounting firm that has not during the
two years preceding the date of its selection acted in any way
on behalf of the Company or any of its subsidiaries. If you
and the Company cannot agree on the accounting firm to serve
as the Auditor, then you and the Company shall each select one
accounting firm, which two firms shall jointly select the
accounting firm to serve as the Auditor. If the Auditor
determines that a reduction in the aggregate of the amounts
constituting the Parachute Payment is required by this
Subsection (F), you shall have the right to specify the
portion of such reduction, if any, that will be made under
this Agreement and each applicable plan or program of the
Company, respectively. If you do not so specify within, 60
days following the date of a determination by the Auditor
pursuant to the preceding sentence, the Company shall
determine, in its sole discretion, the portion of such
reduction, if any, to be made under this Agreement and each
applicable plan or program of the Company, respectively.
5. Successors; Binding
Agreement. (A) Assumption By Successor. The Company will
require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company
to expressly assume and agree to perform this Agreement in the
same manner and to the same extent that the Company would be
required to perform it if no such succession had taken place.
Failure of the Company to obtain such assumption and agreement
prior to the effectiveness of any such succession shall be a
breach of this Agreement and shall entitle you to compensation
from the Company in the same amount and on the same terms as
you would be entitled hereunder if you had terminated your
employment for Good Reason following a Change in Control,
except that for purposes of implementing the foregoing, the
date on which any such succession becomes effective shall be
deemed the Date of Termination. As used in this Agreement,
"the Company" shall mean the Company as hereinbefore defined
and any successor to its business and/or assets as aforesaid
which assumes and agrees to perform this Agreement by
operation of law, or otherwise.
(B) Enforceability By
Beneficiaries. This Agreement shall inure to the benefit of
and be enforceable by your personal or legal representatives,
executors, administrators, successors, heirs, distributees,
devisees and legatees. If you should die while any amount
would still be payable to you hereunder had you continued to
live, all such amounts, unless otherwise provided herein,
shall be paid in accordance with the terms of this Agreement
to your devisee, legatee or other designee or, if there is no
such designee, to your estate.
6. Notice. For
purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in
writing and shall be deemed to have been duly given when
delivered or mailed by United States certified or registered
mail, return receipt requested, postage prepaid, addressed to
the respective parties as follows:
If to the Company: Secretary
Oneida Ltd.
Oneida, New York 13421
99
If to you: Gary L. Moreau
2028 Syosset Drive
Cazenovia, New York 13035
or to such other address as either party may have furnished to
the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon
receipt.
7. Miscellaneous. No
provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is
agreed to in writing. No waiver by either party hereto at any
time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be
performed by such other arty shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or
at any prior or subsequent time. No agreements or
representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either
party which are not expressly set forth in this Agreement, and
this Agreement shall supersede all Prior agreements,
negotiations, correspondence, undertakings and communications
of the parties, oral or written, with respect to the subject
matter hereof. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of
the State of New York.
8. Validity. The
invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in
full force and effect.
9. Counterparts. This
Agreement may be executed in several counterparts, each of
which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
10. Arbitration. Any
dispute or controversy arising under or in connection with
this Agreement shall be settled exclusively by arbitration
conducted in the State of New York in accordance with the
rules of the American Arbitration Association then in effect.
Judgment may be entered on the arbitrator's award in any court
having jurisdiction; provided, however, that you shall be
entitled to seek specific performance of your right to be paid
until the Date of Termination during the pendency of any
dispute or controversy arising under or in connection with
this Agreement.
11. No Contract of
Employment. Nothing in this Agreement shall be construed as
giving you any right to be retained in the employ of the
Company.
12. Headings. The
headings contained in this Agreement are intended solely for
convenience and shall not affect the rights of the parties to
this Agreement.
If this letter sets
forth our agreement on the subject matter hereof, kindly sign
and return to the Company the enclosed copy of this letter,
which will then constitute our agreement on this subject.
Sincerely,
ONEIDA LTD.
By /s/ William D. Matthews
Name: William D. Matthews
Title: Chairman of the Board
and President
Agreed to this 26th day of July, 1989
/s/ Gary L. Moreau
Gary L. Moreau
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July 26, 1989
Mr. Terry M. French
Nichols Pond Road
Canastota, New York 13032
Dear Mr. French:
Oneida Ltd. (the
"Company") considers it essential to the best interests of its
stockholders to foster the continuous employment of key
management personnel. In this connection, the Board of
Directors of the Company (the "Board') recognizes that the
possibility of a change in control of the Company may exist
and that such possibility, and the uncertainty and questions
which it may raise among management, may result in the
departure or distraction of management personnel to the
detriment of the Company and its stockholders.
The Board has
determined that appropriate steps should be taken to reinforce
and encourage the continued attention and dedication of
members of the Company's management, including yourself, to
their assigned duties without distraction in the face of
potentially disturbing circumstances arising from any possible
change in control of the Company.
In order to induce you
to remain in the employ of the Company, the Company agrees
that you shall receive the severance benefits set forth in
this letter agreement (the "Agreement") in the event that your
employment with the Company is terminated subsequent to a
Change in Control (as defined in Section 2).
1. Term of Agreement.
The term of this Agreement (the "Term") shall commence on the
Operative Date (as hereinafter defined) and end on the fifth
anniversary of the Operative Date, provided that it has not
been terminated in accordance with its terms. In the event,
however, that you attain the age of sixty-five (65) during the
Term, then this Agreement shall terminate on the last day of
the month in which you attain the age of sixty-five (65). For
purposes of this Agreement, the term "Operative Date" shall
mean the date on which a Change in Control occurs, provided
that (i) you are then in the employ of the Company and (ii)
such Change in Control occurs before you reach age sixty -five
(65).
2. Change in Control.
No benefits shall be payable hereunder unless there shall have
been a Change in Control. For purposes of this Agreement, a
"Change in Control" shall be deemed to have occurred if:
(A) 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 the Company, any trustee or other fiduciary
holding securities under an employee benefit plan of the
Company, or any company owned, directly or indirectly, by the
stockholders of the Company in substantially the same
proportions as their ownership of sock of the Company), is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act, directly or indirectly, of securities of the
Company representing 20% or more of the combined voting power
of the Company's then outstanding securities;
(B) 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, and any new
director (other than a director designated by a person who has
entered into an agreement with the Company to effect a
transaction described in clause (A), (C) or (D) of this
Section) whose election by the Board or nomination for
election by the Company's stockholders 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 or nomination for election was
previously so approved, cease for any reason to constitute at
least a majority thereof;
101
(C) the stockholders
of the Company approve a merger or consolidation of the
Company with any other company, other than (1) a merger or
consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing
to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) more
than 50% of the combined voting power of the voting securities
of the Company or such surviving entity outstanding
immediately after such merger or consolidation or (2) a merger
or consolidation effected to implement a recapitalization of
the Company (or similar transaction in which no ''person" (as
hereinabove defined) acquires more than 20% of the combined
voting power of the Company's then outstanding securities; or
(D) the stockholders
of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the
Company of all or Substantially all of the Company's assets.
3. Termination
Following Change in Control. If a Change in Control shall have
occurred, you shall be entitled to the benefits provided in
Subsection 4(D) upon the subsequent termination of your
employment during the Term unless such termination is because
of your death or retirement, by the Company for cause or
disability, or by you other than for good reason. In the event
your employment with the Company is terminated for any reason
prior to the Operative Date, you shall not be entitled to any
benefits hereunder.
(A) Disability;
Retirement. If, as a result of your incapacity due to physical
or mental illness, you shall have been absent from the
full-time performance of your duties with the Company for six
(6) consecutive months, and within thirty (30) days after
written Notice of Termination (as defined in Subsection 3(D))
is given you shall not have returned to the full-time
performance of your duties, the Company may terminate your
employment for "Disability." Any question as to the existence
of your Disability upon which you and the Company cannot agree
shall be determined by a qualified independent physician
selected by you (or, if you are unable to make such selection,
it shall be made by any adult member of your immediate
family), and approved by the Company. The determination of
such physician made in writing to the Company and to you shall
be final and conclusive for all purposes of this Agreement.
Termination of your employment based on "Retirement" shall
mean your voluntary termination of employment on a Retirement
Date as defined in the Retirement Plan for Employees of Oneida
Ltd. or any successor plan thereto (the "Pension Plan") as in
effect immediately prior to the occurrence of a Change in
Control (whether or not you are a participant in the Pension
Plan) or in accordance with any retirement arrangement
established with your consent with respect to you.
(B) Cause. Termination
by the Company of your employment for "Cause" shall mean
termination upon (i) the willful and continued failure by you
to substantially perform your duties with the Company (other
than any such failure resulting from your incapacity due to
physical or mental illness or from your Retirement or any such
actual or anticipated failure resulting from termination by
you for Good Reason (as hereinafter defined after a written
demand for substantial performance is delivered to you by the
Board, which demand specifically identifies the manner in
which the Board believes that you have not substantially
performed your duties, or (ii) the willful engaging by you in
conduct which is demonstrably and materially injurious to the
Company, monetarily or otherwise. For purposes of this
Subsection, no act or failure to act on your part shall be
deemed ''willful'' unless done, or omitted to be done, by you
in other than good faith and without reasonable belief that
your action or omission was in the best interests of the
Company. Notwithstanding the foregoing, you shall not be
deemed to have been terminated for Cause unless and until
there shall have been delivered to you a copy of a resolution
duly adopted by the affirmative vote of not less than
three-quarters (3/4) of the entire membership of the Board at
a meeting of the Board (after reasonable notice to you and an
opportunity for you, together with your counsel, to be heard
before the Board), finding that in the good faith opinion of
the Board you were guilty of conduct set forth above in clause
(i) or (ii) of the first sentence of this Subsection and
specifying the particulars thereof in detail.
(C) Good Reason. You
shall be entitled to terminate your employment for Good
Reason. For purposes of this Agreement, "Good Reason" shall
mean, without your express written consent, the occurrence
after a Change in Control of any of the following
circumstances:
102
(i) Inconsistent
Duties. A meaningful and detrimental alteration in your
position or in the nature or status of your responsibilities
(including those as a director of the Company, if any) from
those in effect immediately prior to the Change in Control;
(ii) Reduced Salary or Failure to Increase
Salary. A reduction by the Company in your annual base salary
as in effect on the date hereof or as the same may be
increased from time to time; a failure by the Company to
increase your salary at a rate commensurate with that of other
key executives of the Company; or a failure by the Company to
increase your salary on an annual basis to reflect the
percentage increase in the cost of living (as determined in
accordance with such statistics or indices as the Board shall
reasonably consider appropriate for such purposes).
(iii) Relocation. The relocation of the office
of the Company where you are employed at the time of the
Change in Control (the "CIC Location") to a location which in
your good faith assessment is an area not generally considered
conducive to maintaining the executive offices of a company
such as the Company because of hazardous or undesirable
conditions, including, without limitation, a high crime rate
or inadequate facilities, or to a location which is more than
twenty-five (25) miles away from the CIC Location or the
Company's requiring you to be based more than twenty-five (25)
miles away from the CIC Location (except for required travel
on the Company's business to an extent substantially
consistent with your present business travel obligations);
(iv) Compensation Plans. The failure by the
Company to continue in effect any material compensation,
benefit or profit sharing plan in which you were participating
immediately prior to the Change in Control, unless an
equitable arrangement (embodied in an ongoing substitute or
alternative plan) has been made with respect to such plan, or
the failure by the Company to continue your participation
therein (or in such substitute or alternative plan) on at
least as favorable a basis, both in terms of the amount of
benefits provided and the level of your participation relative
to other participants, as existed immediately prior to the
Change in Control;
(v) Benefits and
Perquisites. The failure by the Company to continue to provide
you with benefits at least as favorable as those enjoyed by
you under any of the Company's pension, life insurance,
medical, health and accident, disability or savings plans in
which you were participating immediately prior to the Change
in Control; the taking of any action by the Company which
would directly or indirectly materially reduce any of such
benefits or deprive you of any material benefit or perquisite
enjoyed by you immediately prior to the Change in Control; or
the failure by the Company to provide you with the number of
paid vacation days to which you are entitled on the basis of
years of service with the Company in accordance with the
Company's normal vacation policy in effect immediately prior
to the Change in Control;
(vi) No Assumption by Successor. The failure
of the Company to obtain a satisfactory agreement from any
successor to assume and agree to perform this Agreement, as
contemplated in Section 5 hereof or, if the business of the
Company for which your services are principally performed is
sold at any time after a Change in Control, the failure of the
purchaser of such business to agree to provide you with the
same or a comparable position, duties, compensation, benefits
and perquisites (as described in clauses (iv) and (v) above)
as provided to you by the Company immediately prior to the
Change in Control; or
(vii) No Notice. Any purported termination of
your employment that is not effected pursuant to a Notice of
Termination satisfying the requirements of Subsection (D)
below (and, if applicable, the requirements of Subsection (B)
above), which purported termination shall not be effective for
purposes of this Agreement.
(D) Notice of
Termination. Any purported termination of your employment by
the Company or by you shall be communicated by written Notice
of Termination to the other party hereto in accordance with
Section 6. For purposes of his Agreement, a "Notice of
Termination" shall mean a notice that shall indicate the
specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of
your employment under the provision so indicated.
103
(E) Date of
Termination, Etc. For purposes of this Agreement, "Date of
Termination' shall mean (i) if your employment is terminated
for Disability, thirty (30) days after a Notice of Termination
is given (provided that you shall not have returned to the
full-time performance of your duties during such thirty (30)
day period), and (ii) if your employment is terminated
pursuant to Subsection (B) or (C) above or for any other
reason (other than Disability), the date specified in the
Notice of Termination (which, in the case of a termination
pursuant to Subsection B) above shall not be less than thirty
(30) days from the date such Notice of Termination is given,
and in the case of a termination pursuant to Subsection (C)
above shall not be less than thirty (30) nor more than sixty
(60) days from the date such Notice of Termination is given);
provided, however, that if within thirty (30) days after any
Notice of Termination is given, the party receiving such
Notice of Termination. notifies the other party that a dispute
exists concerning the termination, the Date of Termination
shall be the date on which the dispute is finally determined,
either by mutual written agreement of the parties, by a
binding arbitration award, or by a final judgment, order or
decree of a court of competent jurisdiction (which is not
appealable or the time for appeal therefrom having expired and
no appeal having been perfected); provided further, however,
that the Date of Termination shall be extended by a notice of
dispute only if such notice is given in good faith and the
party giving such notice pursues the resolution of such
dispute with reasonable diligence. Notwithstanding the
pendency of any such dispute, the Company will continue to pay
you your full compensation in effect when the notice giving
rise to the dispute was given and continue you as a
participant in all compensation, benefit and insurance plans
and perquisites in which you were participating when the
notice giving rise to the dispute was given, until the dispute
is finally resolved in accordance with this Subsection.
Amounts paid under this Subsection are in addition to all
other amounts due under this Agreement and shall not be offset
against or reduce any other amounts due under this Agreement
and shall not be reduced by any compensation earned by you as
the result of employment by another employer.
4. Compensation Upon
Termination or During Disability. Following a Change in
Control, you shall be entitled to the following benefits
during a period of Disability, or upon termination of your
employment, as the case may be, provided that such period or
termination occurs during the Term:
(A) Disability. During
any period that you fail to perform your full-time duties with
the Company as a result of your Disability, you shall continue
to receive your base salary at the rate in effect at the
commencement of any such period, together with compensation
payable to you under the Company's disability insurance
coverage or other plan during such period, until your
employment is terminated pursuant to Subsection 3(A).
Thereafter, your benefits shall be determined in accordance
with the Company's insurance programs and other benefit or
pension plans then in effect in accordance with the terms of
such programs and plans.
(B) Termination for
Other than Good Reason or for Cause. If your employment shall
be terminated by the Company for Cause or by you other than
for Good Reason, death or Retirement, the Company shall pay
you your full base salary through the Date of Termination at
the rate in effect at the time the Notice of Termination is
given, plus all other amounts to which you are entitled
pursuant to the Company's benefit and pension plans then in
effect, and the Company shall have no further obligations to
you under this Agreement.
(C) Retirement; Death.
If your employment shall be terminated for Retirement, or by
reason of your death, your benefits shall be determined in
accordance with the Company's benefit and pension plans then
in effect.
(D) Breach by the
Company. If your employment by the Company shall be terminated
by the Company other than for Cause, Retirement or Disability
or by you for Good Reason, then you shall be entitled to the
benefits provided below:
(i) Base Salary. The
Company shall pay you your full base salary through the Date
of Termination at the rate in effect at the time the Notice of
Termination is given;
104
(ii) Severance Payment. In lieu of any further
salary payments to you for periods subsequent to the Date of
Termination, the Company shall pay as severance pay to you,
not later than the tenth (10th) business day following the
Date of Termination, a lump sum severance payment equal to
2.99 times the average of the annual compensation which was
payable to you by the Company (or any corporation affiliated
with the Company within the meaning of section 1504 of the
Internal Revenue Code of 1986, as amended (the "Code"),
determined without regard to section 1504(b) of the Code) and
includable in your gross income for Federal income tax
purposes for the five (5) taxable years preceding your taxable
year in which a Change in Control occurred. The amount of your
average annual compensation shall be determined in accordance
with the regulations (including proposed regulations)
promulgated under section 280G(d) of the Code; provided,
however, that (a) notwithstanding any provision of such
regulations to the contrary, the amount of your average annual
compensation shall be determined by including as compensation
any contribution (a "401(k) Contribution") pursuant to any
cash or deferred arrangement (as described in section 401(k)
of the Code) maintained by the Company which is not includable
in your gross income under section 402(a)(8) of the Code and
(b) the amount of any such 401(k) Contribution shall be
treated as includable in your gross income in the taxable year
such contribution is made for purposes of the preceding
sentence.
(iii) Legal Fees and
Expenses. The Company shall also pay to you all legal fees
and expenses incurred by you as a result of such termination,
including all such fees and expenses, if any, incurred in
contesting or disputing any such termination or in seeking to
obtain or enforce any right or benefit provided by this
Agreement (other than any such fees or expenses incurred in
connection with any such claim which is determined to be
frivolous).
(iv) Insurance Benefits for 36 Months. For a
thirty-six (36) month period after such termination, the
Company shall arrange to provide you with life, disability,
accident and health insurance benefits substantially similar
to and at no greater cost to you than those which you were
receiving immediately prior to the Notice of Termination.
Benefits otherwise receivable by you pursuant to this
Subsection 4(D)(iv) shall be reduced to the extent comparable
benefits are actually received by you during the thirty-six
(36) month period following your termination, and any such
benefits actually received by you shall be reported to the
Company.
(v) Supplemental
Pension. In addition to the Pension benefits to which you are
entitled under the Pension Plan, the Company shall pay you in
one sum in cash on the tenth (10th) business day following the
Date of Termination, a lump sum equal to the actuarial
equivalent of the excess of (1) the retirement pension
(determined as a straight life annuity commencing at age 65)
which you would have accrued under the terms of the Pension
Plan and any other pension benefit program (without regard to
any amendment to such Pension Plan or other pension benefit
program made subsequent to the Change in Control and on or
prior to the Date of Termination, which amendment adversely
affects in any manner the computation of pension benefits
thereunder), determined as if you were fully vested thereunder
and had accumulated (after the Date of Termination thirty-six
(36) additional months of service credit thereunder at your
highest annual rate of compensation (the "Compensation Rate")
during the twelve (12) months immediately preceding the Date
of Termination (but in no event shall you be deemed to have
accumulated additional months of service credit after your
sixty-fifth (65th) birthday), over (2) the retirement pension
(determined as a straight life annuity commencing at age
sixty-five (65)) which you had then accrued pursuant to the
provisions of the Pension Plan and any other pension benefit
program. For purposes of clause (1) above, the Compensation
Rate shall be deemed to include amounts payable pursuant to
Subsection 4(D)(ii) hereof, and amounts payable pursuant to
Subsection 4(D)(ii) hereof shall be deemed to represent
thirty-six (36) months of compensation (or such lesser number
of months of compensation to your sixty-fifth (65th) birthday)
for purposes of determining benefits under the Pension Plan.
For purposes of this Subsection, "actuarial equivalent" shall
be determined using the same methods and assumptions utilized
under the Pension Plan immediately prior to the Change in
Control.
(vi) Employee Benefit
Plans. You shall be entitled to receive all benefits payable
to you under the Company's benefit and pension plans, not
otherwise specifically provided for in this Subsection 4(D).
105
(E) No Mitigation. You
shall not be required to mitigate the amount of any payment
provided for in this Section 4 by seeking other employment or
otherwise, nor shall the amount of any payment or benefit
provided for in this Section 4 be reduced by any compensation
earned by you as the result of employment by another employer
or by pension benefits after the Date of Termination, or
otherwise except as specifically provided in this Section 4.
(F) Reduction of
Payments In Certain Cases. Notwithstanding anything herein to
the contrary, if any amounts due to you under this Agreement
and any other plan or program of the Company constitute a
"parachute payment," 2S such term is defined in Section
280G(b)(2) of the Code (the "Parachute Payment"), and the
amount of the Parachute Payment, reduced by all federal, state
and local taxes applicable thereto, including the excise tax
imposed pursuant to Section 4999 of the Code, is less than the
amount you would receive if you were paid three times your
"base amount," as defined in Section 280G(b)(3) of the Code,
less $1.00, reduced by all federal, state and local taxes
applicable thereto, then the aggregate of the amounts
constituting the Parachute Payment shall be reduced to an
amount that will equal three times your base amount less
$1.00. The determinations to be made with respect to this
Subsection 4(F) shall be made by an accounting firm (the
"Auditor") jointly selected by the Company and you and paid by
the Company. The Auditor shall be a nationally recognized
United States public accounting firm that has not during the
two years preceding the date of its selection acted in any way
on behalf of the Company or any of its subsidiaries. If you
and the Company cannot agree on the accounting firm to serve
as the Auditor, then you and the Company shall each select one
accounting firm, which two firms shall jointly select the
accounting firm to serve as the Auditor. If the Auditor
determines that a reduction in the aggregate of the amounts
constituting the Parachute Payment is required by this
Subsection (F), you shall have the right to specify the
portion of such reduction, if any, that will be made under
this Agreement and each applicable plan or program of the
Company, respectively. If you do not so specify within, 60
days following the date of a determination by the Auditor
pursuant to the preceding sentence, the Company shall
determine, in its sole discretion, the portion of such
reduction, if any, to be made under this Agreement and each
applicable plan or program of the Company, respectively.
5. Successors; Binding
Agreement. (A) Assumption By Successor. The Company will
require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company
to expressly assume and agree to perform this Agreement in the
same manner and to the same extent that the Company would be
required to perform it if no such succession had taken place.
Failure of the Company to obtain such assumption and agreement
prior to the effectiveness of any such succession shall be a
breach of this Agreement and shall entitle you to compensation
from the Company in the same amount and on the same terms as
you would be entitled hereunder if you had terminated your
employment for Good Reason following a Change in Control,
except that for purposes of implementing the foregoing, the
date on which any such succession becomes effective shall be
deemed the Date of Termination. As used in this Agreement,
"the Company" shall mean the Company as hereinbefore defined
and any successor to its business and/or assets as aforesaid
which assumes and agrees to perform this Agreement by
operation of law, or otherwise.
(B) Enforceability By
Beneficiaries. This Agreement shall inure to the benefit of
and be enforceable by your personal or legal representatives,
executors, administrators, successors, heirs, distributees,
devisees and legatees. If you should die while any amount
would still be payable to you hereunder had you continued to
live, all such amounts, unless otherwise provided herein,
shall be paid in accordance with the terms of this Agreement
to your devisee, legatee or other designee or, if there is no
such designee, to your estate.
6. Notice. For
purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in
writing and shall be deemed to have been duly given when
delivered or mailed by United States certified or registered
mail, return receipt requested, postage prepaid, addressed to
the respective parties as follows:
If to the Company: Secretary
Oneida Ltd.
Oneida, New York 13421
106
If to you: Terry M. French
Nichols Pond Road
Canastota, New York 13032
or to such other address as either party may have furnished to
the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon
receipt.
7. Miscellaneous. No
provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is
agreed to in writing. No waiver by either party hereto at any
time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be
performed by such other arty shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or
at any prior or subsequent time. No agreements or
representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either
party which are not expressly set forth in this Agreement, and
this Agreement shall supersede all Prior agreements,
negotiations, correspondence, undertakings and communications
of the parties, oral or written, with respect to the subject
matter hereof. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of
the State of New York.
8. Validity. The
invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in
full force and effect.
9. Counterparts. This
Agreement may be executed in several counterparts, each of
which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
10. Arbitration. Any
dispute or controversy arising under or in connection with
this Agreement shall be settled exclusively by arbitration
conducted in the State of New York in accordance with the
rules of the American Arbitration Association then in effect.
Judgment may be entered on the arbitrator's award in any court
having jurisdiction; provided, however, that you shall be
entitled to seek specific performance of your right to be paid
until the Date of Termination during the pendency of any
dispute or controversy arising under or in connection with
this Agreement.
11. No Contract of
Employment. Nothing in this Agreement shall be construed as
giving you any right to be retained in the employ of the
Company.
12. Headings. The
headings contained in this Agreement are intended solely for
convenience and shall not affect the rights of the parties to
this Agreement.
If this letter sets
forth our agreement on the subject matter hereof, kindly sign
and return to the Company the enclosed copy of this letter,
which will then constitute our agreement on this subject.
Sincerely,
ONEIDA LTD.
By /s/ William D. Matthews
Name: William D. Matthews
Title: Chairman of the Board
and President
Agreed to this 26th day of July, 1989
/s/ Terry M. French
Terry M. French
<PAGE. 107
July 26, 1989
Mr. Glenn B. Kelsey
Box 200-A, RD 1
Verona, New York 13478
Dear Mr. Kelsey:
Oneida Ltd. (the
"Company") considers it essential to the best interests of its
stockholders to foster the continuous employment of key
management personnel. In this connection, the Board of
Directors of the Company (the "Board') recognizes that the
possibility of a change in control of the Company may exist
and that such possibility, and the uncertainty and questions
which it may raise among management, may result in the
departure or distraction of management personnel to the
detriment of the Company and its stockholders.
The Board has
determined that appropriate steps should be taken to reinforce
and encourage the continued attention and dedication of
members of the Company's management, including yourself, to
their assigned duties without distraction in the face of
potentially disturbing circumstances arising from any possible
change in control of the Company.
In order to induce you
to remain in the employ of the Company, the Company agrees
that you shall receive the severance benefits set forth in
this letter agreement (the "Agreement") in the event that your
employment with the Company is terminated subsequent to a
Change in Control (as defined in Section 2).
1. Term of Agreement.
The term of this Agreement (the "Term") shall commence on the
Operative Date (as hereinafter defined) and end on the fifth
anniversary of the Operative Date, provided that it has not
been terminated in accordance with its terms. In the event,
however, that you attain the age of sixty-five (65) during the
Term, then this Agreement shall terminate on the last day of
the month in which you attain the age of sixty-five (65). For
purposes of this Agreement, the term "Operative Date" shall
mean the date on which a Change in Control occurs, provided
that (i) you are then in the employ of the Company and (ii)
such Change in Control occurs before you reach age sixty -five
(65).
2. Change in Control.
No benefits shall be payable hereunder unless there shall have
been a Change in Control. For purposes of this Agreement, a
"Change in Control" shall be deemed to have occurred if:
(A) 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 the Company, any trustee or other fiduciary
holding securities under an employee benefit plan of the
Company, or any company owned, directly or indirectly, by the
stockholders of the Company in substantially the same
proportions as their ownership of sock of the Company), is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act, directly or indirectly, of securities of the
Company representing 20% or more of the combined voting power
of the Company's then outstanding securities;
(B) 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, and any new
director (other than a director designated by a person who has
entered into an agreement with the Company to effect a
transaction described in clause (A), (C) or (D) of this
Section) whose election by the Board or nomination for
election by the Company's stockholders 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 or nomination for election was
previously so approved, cease for any reason to constitute at
least a majority thereof;
108
(C) the stockholders
of the Company approve a merger or consolidation of the
Company with any other company, other than (1) a merger or
consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing
to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) more
than 50% of the combined voting power of the voting securities
of the Company or such surviving entity outstanding
immediately after such merger or consolidation or (2) a merger
or consolidation effected to implement a recapitalization of
the Company (or similar transaction in which no ''person" (as
hereinabove defined) acquires more than 20% of the combined
voting power of the Company's then outstanding securities; or
(D) the stockholders
of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the
Company of all or Substantially all of the Company's assets.
3. Termination
Following Change in Control. If a Change in Control shall have
occurred, you shall be entitled to the benefits provided in
Subsection 4(D) upon the subsequent termination of your
employment during the Term unless such termination is because
of your death or retirement, by the Company for cause or
disability, or by you other than for good reason. In the event
your employment with the Company is terminated for any reason
prior to the Operative Date, you shall not be entitled to any
benefits hereunder.
(A) Disability;
Retirement. If, as a result of your incapacity due to physical
or mental illness, you shall have been absent from the
full-time performance of your duties with the Company for six
(6) consecutive months, and within thirty (30) days after
written Notice of Termination (as defined in Subsection 3(D))
is given you shall not have returned to the full-time
performance of your duties, the Company may terminate your
employment for "Disability." Any question as to the existence
of your Disability upon which you and the Company cannot agree
shall be determined by a qualified independent physician
selected by you (or, if you are unable to make such selection,
it shall be made by any adult member of your immediate
family), and approved by the Company. The determination of
such physician made in writing to the Company and to you shall
be final and conclusive for all purposes of this Agreement.
Termination of your employment based on "Retirement" shall
mean your voluntary termination of employment on a Retirement
Date as defined in the Retirement Plan for Employees of Oneida
Ltd. or any successor plan thereto (the "Pension Plan") as in
effect immediately prior to the occurrence of a Change in
Control (whether or not you are a participant in the Pension
Plan) or in accordance with any retirement arrangement
established with your consent with respect to you.
(B) Cause. Termination
by the Company of your employment for "Cause" shall mean
termination upon (i) the willful and continued failure by you
to substantially perform your duties with the Company (other
than any such failure resulting from your incapacity due to
physical or mental illness or from your Retirement or any such
actual or anticipated failure resulting from termination by
you for Good Reason (as hereinafter defined after a written
demand for substantial performance is delivered to you by the
Board, which demand specifically identifies the manner in
which the Board believes that you have not substantially
performed your duties, or (ii) the willful engaging by you in
conduct which is demonstrably and materially injurious to the
Company, monetarily or otherwise. For purposes of this
Subsection, no act or failure to act on your part shall be
deemed "willful" unless done, or omitted to be done, by you
in other than good faith and without reasonable belief that
your action or omission was in the best interests of the
Company. Notwithstanding the foregoing, you shall not be
deemed to have been terminated for Cause unless and until
there shall have been delivered to you a copy of a resolution
duly adopted by the affirmative vote of not less than
three-quarters (3/4) of the entire membership of the Board at
a meeting of the Board (after reasonable notice to you and an
opportunity for you, together with your counsel, to be heard
before the Board), finding that in the good faith opinion of
the Board you were guilty of conduct set forth above in clause
(i) or (ii) of the first sentence of this Subsection and
specifying the particulars thereof in detail.
(C) Good Reason. You
shall be entitled to terminate your employment for Good
Reason. For purposes of this Agreement, "Good Reason" shall
mean, without your express written consent, the occurrence
after a Change in Control of any of the following
circumstances:
109
(i) Inconsistent
Duties. A meaningful and detrimental alteration in your
position or in the nature or status of your responsibilities
(including those as a director of the Company, if any) from
those in effect immediately prior to the Change in Control;
(ii) Reduced Salary or Failure to Increase
Salary. A reduction by the Company in your annual base salary
as in effect on the date hereof or as the same may be
increased from time to time; a failure by the Company to
increase your salary at a rate commensurate with that of other
key executives of the Company; or a failure by the Company to
increase your salary on an annual basis to reflect the
percentage increase in the cost of living (as determined in
accordance with such statistics or indices as the Board shall
reasonably consider appropriate for such purposes).
(iii) Relocation. The relocation of the office
of the Company where you are employed at the time of the
Change in Control (the "CIC Location") to a location which in
your good faith assessment is an area not generally considered
conducive to maintaining the executive offices of a company
such as the Company because of hazardous or undesirable
conditions, including, without limitation, a high crime rate
or inadequate facilities, or to a location which is more than
twenty-five (25) miles away from the CIC Location or the
Company's requiring you to be based more than twenty-five (25)
miles away from the CIC Location (except for required travel
on the Company's business to an extent substantially
consistent with your present business travel obligations);
(iv) Compensation Plans. The failure by the
Company to continue in effect any material compensation,
benefit or profit sharing plan in which you were participating
immediately prior to the Change in Control, unless an
equitable arrangement (embodied in an ongoing substitute or
alternative plan) has been made with respect to such plan, or
the failure by the Company to continue your participation
therein (or in such substitute or alternative plan) on at
least as favorable a basis, both in terms of the amount of
benefits provided and the level of your participation relative
to other participants, as existed immediately prior to the
Change in Control;
(v) Benefits and
Perquisites. The failure by the Company to continue to provide
you with benefits at least as favorable as those enjoyed by
you under any of the Company's pension, life insurance,
medical, health and accident, disability or savings plans in
which you were participating immediately prior to the Change
in Control; the taking of any action by the Company which
would directly or indirectly materially reduce any of such
benefits or deprive you of any material benefit or perquisite
enjoyed by you immediately prior to the Change in Control; or
the failure by the Company to provide you with the number of
paid vacation days to which you are entitled on the basis of
years of service with the Company in accordance with the
Company's normal vacation policy in effect immediately prior
to the Change in Control;
(vi) No Assumption by Successor. The failure
of the Company to obtain a satisfactory agreement from any
successor to assume and agree to perform this Agreement, as
contemplated in Section 5 hereof or, if the business of the
Company for which your services are principally performed is
sold at any time after a Change in Control, the failure of the
purchaser of such business to agree to provide you with the
same or a comparable position, duties, compensation, benefits
and perquisites (as described in clauses (iv) and (v) above)
as provided to you by the Company immediately prior to the
Change in Control; or
(vii) No Notice. Any purported termination of
your employment that is not effected pursuant to a Notice of
Termination satisfying the requirements of Subsection (D)
below (and, if applicable, the requirements of Subsection (B)
above), which purported termination shall not be effective for
purposes of this Agreement.
(D) Notice of
Termination. Any purported termination of your employment by
the Company or by you shall be communicated by written Notice
of Termination to the other party hereto in accordance with
Section 6. For purposes of his Agreement, a "Notice of
Termination" shall mean a notice that shall indicate the
specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of
your employment under the provision so indicated.
110
(E) Date of
Termination, Etc. For purposes of this Agreement, "Date of
Termination' shall mean (i) if your employment is terminated
for Disability, thirty (30) days after a Notice of Termination
is given (provided that you shall not have returned to the
full-time performance of your duties during such thirty (30)
day period), and (ii) if your employment is terminated
pursuant to Subsection (B) or (C) above or for any other
reason (other than Disability), the date specified in the
Notice of Termination (which, in the case of a termination
pursuant to Subsection B) above shall not be less than thirty
(30) days from the date such Notice of Termination is given,
and in the case of a termination pursuant to Subsection (C)
above shall not be less than thirty (30) nor more than sixty
(60) days from the date such Notice of Termination is given);
provided, however, that if within thirty (30) days after any
Notice of Termination is given, the party receiving such
Notice of Termination. notifies the other party that a dispute
exists concerning the termination, the Date of Termination
shall be the date on which the dispute is finally determined,
either by mutual written agreement of the parties, by a
binding arbitration award, or by a final judgment, order or
decree of a court of competent jurisdiction (which is not
appealable or the time for appeal therefrom having expired and
no appeal having been perfected); provided further, however,
that the Date of Termination shall be extended by a notice of
dispute only if such notice is given in good faith and the
party giving such notice pursues the resolution of such
dispute with reasonable diligence. Notwithstanding the
pendency of any such dispute, the Company will continue to pay
you your full compensation in effect when the notice giving
rise to the dispute was given and continue you as a
participant in all compensation, benefit and insurance plans
and perquisites in which you were participating when the
notice giving rise to the dispute was given, until the dispute
is finally resolved in accordance with this Subsection.
Amounts paid under this Subsection are in addition to all
other amounts due under this Agreement and shall not be offset
against or reduce any other amounts due under this Agreement
and shall not be reduced by any compensation earned by you as
the result of employment by another employer.
4. Compensation Upon
Termination or During Disability. Following a Change in
Control, you shall be entitled to the following benefits
during a period of Disability, or upon termination of your
employment, as the case may be, provided that such period or
termination occurs during the Term:
(A) Disability. During
any period that you fail to perform your full-time duties with
the Company as a result of your Disability, you shall continue
to receive your base salary at the rate in effect at the
commencement of any such period, together with compensation
payable to you under the Company's disability insurance
coverage or other plan during such period, until your
employment is terminated pursuant to Subsection 3(A).
Thereafter, your benefits shall be determined in accordance
with the Company's insurance programs and other benefit or
pension plans then in effect in accordance with the terms of
such programs and plans.
(B) Termination for
Other than Good Reason or for Cause. If your employment shall
be terminated by the Company for Cause or by you other than
for Good Reason, death or Retirement, the Company shall pay
you your full base salary through the Date of Termination at
the rate in effect at the time the Notice of Termination is
given, plus all other amounts to which you are entitled
pursuant to the Company's benefit and pension plans then in
effect, and the Company shall have no further obligations to
you under this Agreement.
(C) Retirement; Death.
If your employment shall be terminated for Retirement, or by
reason of your death, your benefits shall be determined in
accordance with the Company's benefit and pension plans then
in effect.
(D) Breach by the
Company. If your employment by the Company shall be terminated
by the Company other than for Cause, Retirement or Disability
or by you for Good Reason, then you shall be entitled to the
benefits provided below:
(i) Base Salary. The
Company shall pay you your full base salary through the Date
of Termination at the rate in effect at the time the Notice of
Termination is given;
111
(ii) Severance Payment. In lieu of any further
salary payments to you for periods subsequent to the Date of
Termination, the Company shall pay as severance pay to you,
not later than the tenth (10th) business day following the
Date of Termination, a lump sum severance payment equal to
2.99 times the average of the annual compensation which was
payable to you by the Company (or any corporation affiliated
with the Company within the meaning of section 1504 of the
Internal Revenue Code of 1986, as amended (the "Code"),
determined without regard to section 1504(b) of the Code) and
includable in your gross income for Federal income tax
purposes for the five (5) taxable years preceding your taxable
year in which a Change in Control occurred. The amount of your
average annual compensation shall be determined in accordance
with the regulations (including proposed regulations)
promulgated under section 280G(d) of the Code; provided,
however, that (a) notwithstanding any provision of such
regulations to the contrary, the amount of your average annual
compensation shall be determined by including as compensation
any contribution (a "401(k) Contribution") pursuant to any
cash or deferred arrangement (as described in section 401(k)
of the Code) maintained by the Company which is not includable
in your gross income under section 402(a)(8) of the Code and
(b) the amount of any such 401(k) Contribution shall be
treated as includable in your gross income in the taxable year
such contribution is made for purposes of the preceding
sentence.
(iii) Legal Fees and
Expenses. The Company shall also pay to you all legal fees
and expenses incurred by you as a result of such termination,
including all such fees and expenses, if any, incurred in
contesting or disputing any such termination or in seeking to
obtain or enforce any right or benefit provided by this
Agreement (other than any such fees or expenses incurred in
connection with any such claim which is determined to be
frivolous).
(iv) Insurance Benefits for 36 Months. For a
thirty-six (36) month period after such termination, the
Company shall arrange to provide you with life, disability,
accident and health insurance benefits substantially similar
to and at no greater cost to you than those which you were
receiving immediately prior to the Notice of Termination.
Benefits otherwise receivable by you pursuant to this
Subsection 4(D)(iv) shall be reduced to the extent comparable
benefits are actually received by you during the thirty-six
(36) month period following your termination, and any such
benefits actually received by you shall be reported to the
Company.
(v) Supplemental
Pension. In addition to the Pension benefits to which you are
entitled under the Pension Plan, the Company shall pay you in
one sum in cash on the tenth (10th) business day following the
Date of Termination, a lump sum equal to the actuarial
equivalent of the excess of (1) the retirement pension
(determined as a straight life annuity commencing at age 65)
which you would have accrued under the terms of the Pension
Plan and any other pension benefit program (without regard to
any amendment to such Pension Plan or other pension benefit
program made subsequent to the Change in Control and on or
prior to the Date of Termination, which amendment adversely
affects in any manner the computation of pension benefits
thereunder), determined as if you were fully vested thereunder
and had accumulated (after the Date of Termination thirty-six
(36) additional months of service credit thereunder at your
highest annual rate of compensation (the "Compensation Rate")
during the twelve (12) months immediately preceding the Date
of Termination (but in no event shall you be deemed to have
accumulated additional months of service credit after your
sixty-fifth (65th) birthday), over (2) the retirement pension
(determined as a straight life annuity commencing at age
sixty-five (65)) which you had then accrued pursuant to the
provisions of the Pension Plan and any other pension benefit
program. For purposes of clause (1) above, the Compensation
Rate shall be deemed to include amounts payable pursuant to
Subsection 4(D)(ii) hereof, and amounts payable pursuant to
Subsection 4(D)(ii) hereof shall be deemed to represent
thirty-six (36) months of compensation (or such lesser number
of months of compensation to your sixty-fifth (65th) birthday)
for purposes of determining benefits under the Pension Plan.
For purposes of this Subsection, "actuarial equivalent" shall
be determined using the same methods and assumptions utilized
under the Pension Plan immediately prior to the Change in
Control.
(vi) Employee Benefit
Plans. You shall be entitled to receive all benefits payable
to you under the Company's benefit and pension plans, not
otherwise specifically provided for in this Subsection 4(D).
112
(E) No Mitigation. You
shall not be required to mitigate the amount of any payment
provided for in this Section 4 by seeking other employment or
otherwise, nor shall the amount of any payment or benefit
provided for in this Section 4 be reduced by any compensation
earned by you as the result of employment by another employer
or by pension benefits after the Date of Termination, or
otherwise except as specifically provided in this Section 4.
(F) Reduction of
Payments In Certain Cases. Notwithstanding anything herein to
the contrary, if any amounts due to you under this Agreement
and any other plan or program of the Company constitute a
"parachute payment," 2S such term is defined in Section
280G(b)(2) of the Code (the "Parachute Payment"), and the
amount of the Parachute Payment, reduced by all federal, state
and local taxes applicable thereto, including the excise tax
imposed pursuant to Section 4999 of the Code, is less than the
amount you would receive if you were paid three times your
"base amount," as defined in Section 280G(b)(3) of the Code,
less $1.00, reduced by all federal, state and local taxes
applicable thereto, then the aggregate of the amounts
constituting the Parachute Payment shall be reduced to an
amount that will equal three times your base amount less
$1.00. The determinations to be made with respect to this
Subsection 4(F) shall be made by an accounting firm (the
"Auditor") jointly selected by the Company and you and paid by
the Company. The Auditor shall be a nationally recognized
United States public accounting firm that has not during the
two years preceding the date of its selection acted in any way
on behalf of the Company or any of its subsidiaries. If you
and the Company cannot agree on the accounting firm to serve
as the Auditor, then you and the Company shall each select one
accounting firm, which two firms shall jointly select the
accounting firm to serve as the Auditor. If the Auditor
determines that a reduction in the aggregate of the amounts
constituting the Parachute Payment is required by this
Subsection (F), you shall have the right to specify the
portion of such reduction, if any, that will be made under
this Agreement and each applicable plan or program of the
Company, respectively. If you do not so specify within, 60
days following the date of a determination by the Auditor
pursuant to the preceding sentence, the Company shall
determine, in its sole discretion, the portion of such
reduction, if any, to be made under this Agreement and each
applicable plan or program of the Company, respectively.
5. Successors; Binding
Agreement. (A) Assumption By Successor. The Company will
require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company
to expressly assume and agree to perform this Agreement in the
same manner and to the same extent that the Company would be
required to perform it if no such succession had taken place.
Failure of the Company to obtain such assumption and agreement
prior to the effectiveness of any such succession shall be a
breach of this Agreement and shall entitle you to compensation
from the Company in the same amount and on the same terms as
you would be entitled hereunder if you had terminated your
employment for Good Reason following a Change in Control,
except that for purposes of implementing the foregoing, the
date on which any such succession becomes effective shall be
deemed the Date of Termination. As used in this Agreement,
"the Company" shall mean the Company as hereinbefore defined
and any successor to its business and/or assets as aforesaid
which assumes and agrees to perform this Agreement by
operation of law, or otherwise.
(B) Enforceability By
Beneficiaries. This Agreement shall inure to the benefit of
and be enforceable by your personal or legal representatives,
executors, administrators, successors, heirs, distributees,
devisees and legatees. If you should die while any amount
would still be payable to you hereunder had you continued to
live, all such amounts, unless otherwise provided herein,
shall be paid in accordance with the terms of this Agreement
to your devisee, legatee or other designee or, if there is no
such designee, to your estate.
6. Notice. For
purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in
writing and shall be deemed to have been duly given when
delivered or mailed by United States certified or registered
mail, return receipt requested, postage prepaid, addressed to
the respective parties as follows:
If to the Company: Secretary
Oneida Ltd.
Oneida, New York 13421
113
If to you: Glenn B. Kelsey
Box 200-A, RD 1
Verona, New York 13478
or to such other address as either party may have furnished to
the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon
receipt.
7. Miscellaneous. No
provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is
agreed to in writing. No waiver by either party hereto at any
time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be
performed by such other arty shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or
at any prior or subsequent time. No agreements or
representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either
party which are not expressly set forth in this Agreement, and
this Agreement shall supersede all Prior agreements,
negotiations, correspondence, undertakings and communications
of the parties, oral or written, with respect to the subject
matter hereof. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of
the State of New York.
8. Validity. The
invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in
full force and effect.
9. Counterparts. This
Agreement may be executed in several counterparts, each of
which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
10. Arbitration. Any
dispute or controversy arising under or in connection with
this Agreement shall be settled exclusively by arbitration
conducted in the State of New York in accordance with the
rules of the American Arbitration Association then in effect.
Judgment may be entered on the arbitrator's award in any court
having jurisdiction; provided, however, that you shall be
entitled to seek specific performance of your right to be paid
until the Date of Termination during the pendency of any
dispute or controversy arising under or in connection with
this Agreement.
11. No Contract of
Employment. Nothing in this Agreement shall be construed as
giving you any right to be retained in the employ of the
Company.
12. Headings. The
headings contained in this Agreement are intended solely for
convenience and shall not affect the rights of the parties to
this Agreement.
If this letter sets
forth our agreement on the subject matter hereof, kindly sign
and return to the Company the enclosed copy of this letter,
which will then constitute our agreement on this subject.
Sincerely,
ONEIDA LTD.
By /s/ William D. Matthews
Name: William D. Matthews
Title: Chairman of the Board
and President
Agreed to this 26th day of July, 1989
/s/ Glenn B. Kelsey
Glenn B. Kelsey
114
July 26, 1989
Mr. Thomas A. Fetzner
7767 Academy Street
Fabius, New York 13063
Dear Mr. Fetzner:
Oneida Ltd. (the
"Company") considers it essential to the best interests of its
stockholders to foster the continuous employment of key
management personnel. In this connection, the Board of
Directors of the Company (the "Board') recognizes that the
possibility of a change in control of the Company may exist
and that such possibility, and the uncertainty and questions
which it may raise among management, may result in the
departure or distraction of management personnel to the
detriment of the Company and its stockholders.
The Board has
determined that appropriate steps should be taken to reinforce
and encourage the continued attention and dedication of
members of the Company's management, including yourself, to
their assigned duties without distraction in the face of
potentially disturbing circumstances arising from any possible
change in control of the Company.
In order to induce you
to remain in the employ of the Company, the Company agrees
that you shall receive the severance benefits set forth in
this letter agreement (the "Agreement") in the event that your
employment with the Company is terminated subsequent to a
Change in Control (as defined in Section 2).
1. Term of Agreement.
The term of this Agreement (the "Term") shall commence on the
Operative Date (as hereinafter defined) and end on the fifth
anniversary of the Operative Date, provided that it has not
been terminated in accordance with its terms. In the event,
however, that you attain the age of sixty-five (65) during the
Term, then this Agreement shall terminate on the last day of
the month in which you attain the age of sixty-five (65). For
purposes of this Agreement, the term "Operative Date" shall
mean the date on which a Change in Control occurs, provided
that (i) you are then in the employ of the Company and (ii)
such Change in Control occurs before you reach age sixty -five
(65).
2. Change in Control.
No benefits shall be payable hereunder unless there shall have
been a Change in Control. For purposes of this Agreement, a
"Change in Control" shall be deemed to have occurred if:
(A) 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 the Company, any trustee or other fiduciary
holding securities under an employee benefit plan of the
Company, or any company owned, directly or indirectly, by the
stockholders of the Company in substantially the same
proportions as their ownership of sock of the Company), is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act, directly or indirectly, of securities of the
Company representing 20% or more of the combined voting power
of the Company's then outstanding securities;
(B) 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, and any new
director (other than a director designated by a person who has
entered into an agreement with the Company to effect a
transaction described in clause (A), (C) or (D) of this
Section) whose election by the Board or nomination for
election by the Company's stockholders 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 or nomination for election was
previously so approved, cease for any reason to constitute at
least a majority thereof;
115
(C) the stockholders
of the Company approve a merger or consolidation of the
Company with any other company, other than (1) a merger or
consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing
to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) more
than 50% of the combined voting power of the voting securities
of the Company or such surviving entity outstanding
immediately after such merger or consolidation or (2) a merger
or consolidation effected to implement a recapitalization of
the Company (or similar transaction in which no ''person" (as
hereinabove defined) acquires more than 20% of the combined
voting power of the Company's then outstanding securities; or
(D) the stockholders
of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the
Company of all or Substantially all of the Company's assets.
3. Termination
Following Change in Control. If a Change in Control shall have
occurred, you shall be entitled to the benefits provided in
Subsection 4(D) upon the subsequent termination of your
employment during the Term unless such termination is because
of your death or retirement, by the Company for cause or
disability, or by you other than for good reason. In the event
your employment with the Company is terminated for any reason
prior to the Operative Date, you shall not be entitled to any
benefits hereunder.
(A) Disability;
Retirement. If, as a result of your incapacity due to physical
or mental illness, you shall have been absent from the
full-time performance of your duties with the Company for six
(6) consecutive months, and within thirty (30) days after
written Notice of Termination (as defined in Subsection 3(D))
is given you shall not have returned to the full-time
performance of your duties, the Company may terminate your
employment for "Disability." Any question as to the existence
of your Disability upon which you and the Company cannot agree
shall be determined by a qualified independent physician
selected by you (or, if you are unable to make such selection,
it shall be made by any adult member of your immediate
family), and approved by the Company. The determination of
such physician made in writing to the Company and to you shall
be final and conclusive for all purposes of this Agreement.
Termination of your employment based on "Retirement" shall
mean your voluntary termination of employment on a Retirement
Date as defined in the Retirement Plan for Employees of Oneida
Ltd. or any successor plan thereto (the "Pension Plan") as in
effect immediately prior to the occurrence of a Change in
Control (whether or not you are a participant in the Pension
Plan) or in accordance with any retirement arrangement
established with your consent with respect to you.
(B) Cause. Termination
by the Company of your employment for "Cause" shall mean
termination upon (i) the willful and continued failure by you
to substantially perform your duties with the Company (other
than any such failure resulting from your incapacity due to
physical or mental illness or from your Retirement or any such
actual or anticipated failure resulting from termination by
you for Good Reason (as hereinafter defined after a written
demand for substantial performance is delivered to you by the
Board, which demand specifically identifies the manner in
which the Board believes that you have not substantially
performed your duties, or (ii) the willful engaging by you in
conduct which is demonstrably and materially injurious to the
Company, monetarily or otherwise. For purposes of this
Subsection, no act or failure to act on your part shall be
deemed ''willful'' unless done, or omitted to be done, by you
in other than good faith and without reasonable belief that
your action or omission was in the best interests of the
Company. Notwithstanding the foregoing, you shall not be
deemed to have been terminated for Cause unless and until
there shall have been delivered to you a copy of a resolution
duly adopted by the affirmative vote of not less than
three-quarters (3/4) of the entire membership of the Board at
a meeting of the Board (after reasonable notice to you and an
opportunity for you, together with your counsel, to be heard
before the Board), finding that in the good faith opinion of
the Board you were guilty of conduct set forth above in clause
(i) or (ii) of the first sentence of this Subsection and
specifying the particulars thereof in detail.
(C) Good Reason. You
shall be entitled to terminate your employment for Good
Reason. For purposes of this Agreement, "Good Reason" shall
mean, without your express written consent, the occurrence
after a Change in Control of any of the following
circumstances:
116
(i) Inconsistent
Duties. A meaningful and detrimental alteration in your
position or in the nature or status of your responsibilities
(including those as a director of the Company, if any) from
those in effect immediately prior to the Change in Control;
(ii) Reduced Salary or Failure to Increase
Salary. A reduction by the Company in your annual base salary
as in effect on the date hereof or as the same may be
increased from time to time; a failure by the Company to
increase your salary at a rate commensurate with that of other
key executives of the Company; or a failure by the Company to
increase your salary on an annual basis to reflect the
percentage increase in the cost of living (as determined in
accordance with such statistics or indices as the Board shall
reasonably consider appropriate for such purposes).
(iii) Relocation. The relocation of the office
of the Company where you are employed at the time of the
Change in Control (the "CIC Location") to a location which in
your good faith assessment is an area not generally considered
conducive to maintaining the executive offices of a company
such as the Company because of hazardous or undesirable
conditions, including, without limitation, a high crime rate
or inadequate facilities, or to a location which is more than
twenty-five (25) miles away from the CIC Location or the
Company's requiring you to be based more than twenty-five (25)
miles away from the CIC Location (except for required travel
on the Company's business to an extent substantially
consistent with your present business travel obligations);
(iv) Compensation Plans. The failure by the
Company to continue in effect any material compensation,
benefit or profit sharing plan in which you were participating
immediately prior to the Change in Control, unless an
equitable arrangement (embodied in an ongoing substitute or
alternative plan) has been made with respect to such plan, or
the failure by the Company to continue your participation
therein (or in such substitute or alternative plan) on at
least as favorable a basis, both in terms of the amount of
benefits provided and the level of your participation relative
to other participants, as existed immediately prior to the
Change in Control;
(v) Benefits and
Perquisites. The failure by the Company to continue to provide
you with benefits at least as favorable as those enjoyed by
you under any of the Company's pension, life insurance,
medical, health and accident, disability or savings plans in
which you were participating immediately prior to the Change
in Control; the taking of any action by the Company which
would directly or indirectly materially reduce any of such
benefits or deprive you of any material benefit or perquisite
enjoyed by you immediately prior to the Change in Control; or
the failure by the Company to provide you with the number of
paid vacation days to which you are entitled on the basis of
years of service with the Company in accordance with the
Company's normal vacation policy in effect immediately prior
to the Change in Control;
(vi) No Assumption by Successor. The failure
of the Company to obtain a satisfactory agreement from any
successor to assume and agree to perform this Agreement, as
contemplated in Section 5 hereof or, if the business of the
Company for which your services are principally performed is
sold at any time after a Change in Control, the failure of the
purchaser of such business to agree to provide you with the
same or a comparable position, duties, compensation, benefits
and perquisites (as described in clauses (iv) and (v) above)
as provided to you by the Company immediately prior to the
Change in Control; or
(vii) No Notice. Any purported termination of
your employment that is not effected pursuant to a Notice of
Termination satisfying the requirements of Subsection (D)
below (and, if applicable, the requirements of Subsection (B)
above), which purported termination shall not be effective for
purposes of this Agreement.
(D) Notice of
Termination. Any purported termination of your employment by
the Company or by you shall be communicated by written Notice
of Termination to the other party hereto in accordance with
Section 6. For purposes of his Agreement, a "Notice of
Termination" shall mean a notice that shall indicate the
specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of
your employment under the provision so indicated.
117
(E) Date of
Termination, Etc. For purposes of this Agreement, "Date of
Termination' shall mean (i) if your employment is terminated
for Disability, thirty (30) days after a Notice of Termination
is given (provided that you shall not have returned to the
full-time performance of your duties during such thirty (30)
day period), and (ii) if your employment is terminated
pursuant to Subsection (B) or (C) above or for any other
reason (other than Disability), the date specified in the
Notice of Termination (which, in the case of a termination
pursuant to Subsection B) above shall not be less than thirty
(30) days from the date such Notice of Termination is given,
and in the case of a termination pursuant to Subsection (C)
above shall not be less than thirty (30) nor more than sixty
(60) days from the date such Notice of Termination is given);
provided, however, that if within thirty (30) days after any
Notice of Termination is given, the party receiving such
Notice of Termination. notifies the other party that a dispute
exists concerning the termination, the Date of Termination
shall be the date on which the dispute is finally determined,
either by mutual written agreement of the parties, by a
binding arbitration award, or by a final judgment, order or
decree of a court of competent jurisdiction (which is not
appealable or the time for appeal therefrom having expired and
no appeal having been perfected); provided further, however,
that the Date of Termination shall be extended by a notice of
dispute only if such notice is given in good faith and the
party giving such notice pursues the resolution of such
dispute with reasonable diligence. Notwithstanding the
pendency of any such dispute, the Company will continue to pay
you your full compensation in effect when the notice giving
rise to the dispute was given and continue you as a
participant in all compensation, benefit and insurance plans
and perquisites in which you were participating when the
notice giving rise to the dispute was given, until the dispute
is finally resolved in accordance with this Subsection.
Amounts paid under this Subsection are in addition to all
other amounts due under this Agreement and shall not be offset
against or reduce any other amounts due under this Agreement
and shall not be reduced by any compensation earned by you as
the result of employment by another employer.
4. Compensation Upon
Termination or During Disability. Following a Change in
Control, you shall be entitled to the following benefits
during a period of Disability, or upon termination of your
employment, as the case may be, provided that such period or
termination occurs during the Term:
(A) Disability. During
any period that you fail to perform your full-time duties with
the Company as a result of your Disability, you shall continue
to receive your base salary at the rate in effect at the
commencement of any such period, together with compensation
payable to you under the Company's disability insurance
coverage or other plan during such period, until your
employment is terminated pursuant to Subsection 3(A).
Thereafter, your benefits shall be determined in accordance
with the Company's insurance programs and other benefit or
pension plans then in effect in accordance with the terms of
such programs and plans.
(B) Termination for
Other than Good Reason or for Cause. If your employment shall
be terminated by the Company for Cause or by you other than
for Good Reason, death or Retirement, the Company shall pay
you your full base salary through the Date of Termination at
the rate in effect at the time the Notice of Termination is
given, plus all other amounts to which you are entitled
pursuant to the Company's benefit and pension plans then in
effect, and the Company shall have no further obligations to
you under this Agreement.
(C) Retirement; Death.
If your employment shall be terminated for Retirement, or by
reason of your death, your benefits shall be determined in
accordance with the Company's benefit and pension plans then
in effect.
(D) Breach by the
Company. If your employment by the Company shall be terminated
by the Company other than for Cause, Retirement or Disability
or by you for Good Reason, then you shall be entitled to the
benefits provided below:
(i) Base Salary. The
Company shall pay you your full base salary through the Date
of Termination at the rate in effect at the time the Notice of
Termination is given;
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(ii) Severance Payment. In lieu of any further
salary payments to you for periods subsequent to the Date of
Termination, the Company shall pay as severance pay to you,
not later than the tenth (10th) business day following the
Date of Termination, a lump sum severance payment equal to
2.99 times the average of the annual compensation which was
payable to you by the Company (or any corporation affiliated
with the Company within the meaning of section 1504 of the
Internal Revenue Code of 1986, as amended (the "Code"),
determined without regard to section 1504(b) of the Code) and
includable in your gross income for Federal income tax
purposes for the five (5) taxable years preceding your taxable
year in which a Change in Control occurred. The amount of your
average annual compensation shall be determined in accordance
with the regulations (including proposed regulations)
promulgated under section 280G(d) of the Code; provided,
however, that (a) notwithstanding any provision of such
regulations to the contrary, the amount of your average annual
compensation shall be determined by including as compensation
any contribution (a "401(k) Contribution") pursuant to any
cash or deferred arrangement (as described in section 401(k)
of the Code) maintained by the Company which is not includable
in your gross income under section 402(a)(8) of the Code and
(b) the amount of any such 401(k) Contribution shall be
treated as includable in your gross income in the taxable year
such contribution is made for purposes of the preceding
sentence.
(iii) Legal Fees and
Expenses. The Company shall also pay to you all legal fees
and expenses incurred by you as a result of such termination,
including all such fees and expenses, if any, incurred in
contesting or disputing any such termination or in seeking to
obtain or enforce any right or benefit provided by this
Agreement (other than any such fees or expenses incurred in
connection with any such claim which is determined to be
frivolous).
(iv) Insurance Benefits for 36 Months. For a
thirty-six (36) month period after such termination, the
Company shall arrange to provide you with life, disability,
accident and health insurance benefits substantially similar
to and at no greater cost to you than those which you were
receiving immediately prior to the Notice of Termination.
Benefits otherwise receivable by you pursuant to this
Subsection 4(D)(iv) shall be reduced to the extent comparable
benefits are actually received by you during the thirty-six
(36) month period following your termination, and any such
benefits actually received by you shall be reported to the
Company.
(v) Supplemental
Pension. In addition to the Pension benefits to which you are
entitled under the Pension Plan, the Company shall pay you in
one sum in cash on the tenth (10th) business day following the
Date of Termination, a lump sum equal to the actuarial
equivalent of the excess of (1) the retirement pension
(determined as a straight life annuity commencing at age 65)
which you would have accrued under the terms of the Pension
Plan and any other pension benefit program (without regard to
any amendment to such Pension Plan or other pension benefit
program made subsequent to the Change in Control and on or
prior to the Date of Termination, which amendment adversely
affects in any manner the computation of pension benefits
thereunder), determined as if you were fully vested thereunder
and had accumulated (after the Date of Termination thirty-six
(36) additional months of service credit thereunder at your
highest annual rate of compensation (the "Compensation Rate")
during the twelve (12) months immediately preceding the Date
of Termination (but in no event shall you be deemed to have
accumulated additional months of service credit after your
sixty-fifth (65th) birthday), over (2) the retirement pension
(determined as a straight life annuity commencing at age
sixty-five (65)) which you had then accrued pursuant to the
provisions of the Pension Plan and any other pension benefit
program. For purposes of clause (1) above, the Compensation
Rate shall be deemed to include amounts payable pursuant to
Subsection 4(D)(ii) hereof, and amounts payable pursuant to
Subsection 4(D)(ii) hereof shall be deemed to represent
thirty-six (36) months of compensation (or such lesser number
of months of compensation to your sixty-fifth (65th) birthday)
for purposes of determining benefits under the Pension Plan.
For purposes of this Subsection, "actuarial equivalent" shall
be determined using the same methods and assumptions utilized
under the Pension Plan immediately prior to the Change in
Control.
(vi) Employee Benefit
Plans . You shall be entitled to receive all benefits payable
to you under the Company's benefit and pension plans, not
otherwise specifically provided for in this Subsection 4(D).
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(E) No Mitigation. You
shall not be required to mitigate the amount of any payment
provided for in this Section 4 by seeking other employment or
otherwise, nor shall the amount of any payment or benefit
provided for in this Section 4 be reduced by any compensation
earned by you as the result of employment by another employer
or by pension benefits after the Date of Termination, or
otherwise except as specifically provided in this Section 4.
(F) Reduction of
Payments In Certain Cases. Notwithstanding anything herein to
the contrary, if any amounts due to you under this Agreement
and any other plan or program of the Company constitute a
"parachute payment," 2S such term is defined in Section
280G(b)(2) of the Code (the "Parachute Payment"), and the
amount of the Parachute Payment, reduced by all federal, state
and local taxes applicable thereto, including the excise tax
imposed pursuant to Section 4999 of the Code, is less than the
amount you would receive if you were paid three times your
"base amount," as defined in Section 280G(b)(3) of the Code,
less $1.00, reduced by all federal, state and local taxes
applicable thereto, then the aggregate of the amounts
constituting the Parachute Payment shall be reduced to an
amount that will equal three times your base amount less
$1.00. The determinations to be made with respect to this
Subsection 4(F) shall be made by an accounting firm (the
"Auditor") jointly selected by the Company and you and paid by
the Company. The Auditor shall be a nationally recognized
United States public accounting firm that has not during the
two years preceding the date of its selection acted in any way
on behalf of the Company or any of its subsidiaries. If you
and the Company cannot agree on the accounting firm to serve
as the Auditor, then you and the Company shall each select one
accounting firm, which two firms shall jointly select the
accounting firm to serve as the Auditor. If the Auditor
determines that a reduction in the aggregate of the amounts
constituting the Parachute Payment is required by this
Subsection (F), you shall have the right to specify the
portion of such reduction, if any, that will be made under
this Agreement and each applicable plan or program of the
Company, respectively. If you do not so specify within, 60
days following the date of a determination by the Auditor
pursuant to the preceding sentence, the Company shall
determine, in its sole discretion, the portion of such
reduction, if any, to be made under this Agreement and each
applicable plan or program of the Company, respectively.
5. Successors; Binding
Agreement. (A) Assumption By Successor. The Company will
require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company
to expressly assume and agree to perform this Agreement in the
same manner and to the same extent that the Company would be
required to perform it if no such succession had taken place.
Failure of the Company to obtain such assumption and agreement
prior to the effectiveness of any such succession shall be a
breach of this Agreement and shall entitle you to compensation
from the Company in the same amount and on the same terms as
you would be entitled hereunder if you had terminated your
employment for Good Reason following a Change in Control,
except that for purposes of implementing the foregoing, the
date on which any such succession becomes effective shall be
deemed the Date of Termination. As used in this Agreement,
"the Company" shall mean the Company as hereinbefore defined
and any successor to its business and/or assets as aforesaid
which assumes and agrees to perform this Agreement by
operation of law, or otherwise.
(B) Enforceability By
Beneficiaries. This Agreement shall inure to the benefit of
and be enforceable by your personal or legal representatives,
executors, administrators, successors, heirs, distributees,
devisees and legatees. If you should die while any amount
would still be payable to you hereunder had you continued to
live, all such amounts, unless otherwise provided herein,
shall be paid in accordance with the terms of this Agreement
to your devisee, legatee or other designee or, if there is no
such designee, to your estate.
6. Notice. For
purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in
writing and shall be deemed to have been duly given when
delivered or mailed by United States certified or registered
mail, return receipt requested, postage prepaid, addressed to
the respective parties as follows:
If to the Company: Secretary
Oneida Ltd.
Oneida, New York 13421
120
If to you: Thomas A. Fetzner
7767 Academy Street
Fabius, New York 13063
or to such other address as either party may have furnished to
the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon
receipt.
7. Miscellaneous. No
provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is
agreed to in writing. No waiver by either party hereto at any
time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be
performed by such other arty shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or
at any prior or subsequent time. No agreements or
representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either
party which are not expressly set forth in this Agreement, and
this Agreement shall supersede all Prior agreements,
negotiations, correspondence, undertakings and communications
of the parties, oral or written, with respect to the subject
matter hereof. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of
the State of New York.
8. Validity. The
invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in
full force and effect.
9. Counterparts. This
Agreement may be executed in several counterparts, each of
which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
10. Arbitration. Any
dispute or controversy arising under or in connection with
this Agreement shall be settled exclusively by arbitration
conducted in the State of New York in accordance with the
rules of the American Arbitration Association then in effect.
Judgment may be entered on the arbitrator's award in any court
having jurisdiction; provided, however, that you shall be
entitled to seek specific performance of your right to be paid
until the Date of Termination during the pendency of any
dispute or controversy arising under or in connection with
this Agreement.
11. No Contract of
Employment. Nothing in this Agreement shall be construed as
giving you any right to be retained in the employ of the
Company.
12. Headings. The
headings contained in this Agreement are intended solely for
convenience and shall not affect the rights of the parties to
this Agreement.
If this letter sets
forth our agreement on the subject matter hereof, kindly sign
and return to the Company the enclosed copy of this letter,
which will then constitute our agreement on this subject.
Sincerely,
ONEIDA LTD.
By /s/ William D. Matthews
Name: William D. Matthews
Title: Chairman of the Board
and President
Agreed to this 26th day of July, 1989
/s/ Thomas A. Fetzner
Thomas A. Fetzner