UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 3, 2006
CSS Industries, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 1-2661 13-920657
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(State or other jurisdiction (Commission (IRS Employee
of incorporation) File Number) Identification No.)
1845 Walnut Street, Philadelphia, PA 19103
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (215) 569-9900
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Not Applicable
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement
On April 3, 2006, CSS Industries, Inc. ("CSS") entered into a Separation
Agreement ("Agreement") with David J. M. Erskine, the President and Chief
Executive Officer of CSS and a member of its Board of Directors. The Agreement
reflects that Mr. Erskine will retire as an executive officer, employee and
director of CSS effective June 30, 2006 (the "Separation Date"). The Agreement
further provides that CSS will make severance payments to Mr. Erskine in the
aggregate amount of $468,000, and that CSS-paid medical insurance benefits will
be provided to Mr. Erskine for a period of six months following the Separation
Date. Additionally, the Agreement reflects that all stock options previously
granted to Mr. Erskine that are exercisable as of the Separation Date will
remain exercisable following the Separation Date for the periods of time
reflected in the respective plan documents pursuant to which such options were
granted. Under applicable provisions of these plan documents, the aforementioned
stock options will remain exercisable for periods of 90 days or 180 days,
depending on the plan under which such options were granted. The Agreement also
reflects that those stock options previously granted to Mr. Erskine which are
not exercisable as of the Separation Date will terminate as of such date. The
Agreement includes non-competition and non-solicitation obligations that are
applicable to Mr. Erskine for a period of twelve (12) months, commencing on the
Separation Date. The severance payments, which together with the other CSS
obligations under the Agreement are conditioned upon the execution and delivery
of a release of claims by Mr. Erskine following the Separation Date, are payable
in installments, with 50% of the aggregate severance payments being payable in a
lump sum approximately six months after the Separation Date (or such earlier
date as is permitted under Section 409A of the Internal Revenue Code) and the
remaining 50% payable in equal semi-monthly installments over a six-month period
that commences upon payment of the aforementioned lump sum amount. Under the
Agreement, all severance payments are subject to and will be reduced by any
requisite tax withholdings and other applicable payroll deductions. Furthermore,
the Agreement provides that the severance payments will be reduced by any
earnings and other cash compensation received by Mr. Erskine or accrued for his
benefit for services rendered by him during the twelve-month period that
commences on the Separation Date.
Item 5.02 Departure of Directors or Principal Officers; Election of Directors;
Appointment of Principal Officers
On April 3, 2006, David J. M. Erskine announced his retirement as President and
Chief Executive Officer of CSS and as a member of the Board of Directors of CSS,
effective June 30, 2006. The Board of Directors of CSS has appointed Christopher
J. Munyan as President and Chief Executive Officer of CSS, effective upon Mr.
Erskine's retirement. Mr. Munyan, age 40, has served as Executive Vice President
and Chief Operating Officer of CSS since October 2005. From November 1999 until
October 2005, Mr. Munyan served as President of Berwick Offray LLC, a subsidiary
of CSS. Prior to his appointment as President of Berwick Offray, Mr. Munyan
served as Berwick Offray's Senior Vice President-Finance and Administration and
in various other capacities since 1993. Berwick Offray designs, manufactures,
imports and sells decorative ribbon and bow products and related items. Mr.
Munyan and CSS are parties to an employment agreement dated October 25, 2005,
the material terms of which are described in Item 1.01 of the Current Report on
Form 8-K filed by CSS on October 27, 2005 and are hereby incorporated by
reference herein.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CSS Industries, Inc.
(Registrant)
By: /s/ William G. Kiesling
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William G. Kiesling
Vice President and
General Counsel
Date: April 7, 2006