EXHIBIT 10 (t)
PERSONAL & CONFIDENTIAL
March 12, 1995
Mr. Richard H. Irving III
201 Maison Court
Elmhurst, Illinois 60126
Dear Dick:
On behalf of Red and other Senior Management of Blount, Inc., we
were delighted to have you and Kitty in Montgomery this weekend.
Obviously, our evaluation of you and your skills and experience in
relation to our company leads us to believe that you could and
would make a significant contribution to our efforts. We have an
exciting future planned for Blount and we all want you to be a part
of it.
Confirming our conversations with you, I would like to summarize
the specifics of our employment offer. These items would be
formalized in an employment contract once we reach agreement on the
following:
1. You would be elected Senior Vice President and General
Counsel of Blount, Inc. This position reports to me as
President and Chief Executive Officer of the company.
Your responsibilities, duties and authority have been
discussed in general and are detailed in the Senior Vice
President and General Counsel position description
furnished earlier. Hopefully, you can assume these
duties devoting your full time to the affairs of the
company as soon as possible but no later than May 15,
1995. Appropriate officers' insurance is provided to
this position as well as all other officers of the
company.
2. Your initial base salary will be $245,000 per year paid
semi-monthly. We normally review salaries every twelve
calendar months with raises being effective the first
quarter of each operating year. You will participate in
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our Management Incentive Bonus Program; your annual
target bonus will be 45% of your base salary. The target
bonus will be subject to decreases or increases up to
200% of target (maximum bonus) depending upon the
attainment of specific corporate and individual key base
objectives. For FY 96 you would have a guaranteed bonus
of not less than $100,000. Maximum bonuses have been
earned at Blount, Inc. in FY 94 and FY 95. Our bonuses
are normally paid in April. Specific key base objectives
for you will be developed and established; corporate
objectives are generally in concert with our strategic
plan. We will establish your individual objectives soon
after you begin your employment.
3. You will be provided options for 20,000 shares of Blount
"A" stock which will vest in equal $100,000 increments as
allowed by the IRS. These shares will be awarded under
our Incentive Stock Option Plan (copy attached) and will
be granted soon after the commencement of your
employment. The option price will be the average of the
high and low price of Blount "A" stock on the date the
options are granted.
4. You will participate in all of the company's standard
benefit programs. These provide first-day coverage for
medical, life, dental and vision insurance. The one-year
waiting period for our Long Term Disability Program will
be waived in your instance. Our group term life
insurance coverage is equal to 2 times base salary plus
an equal amount for accidental death. In addition, we
carry a $250,000 accidental death benefit for each
employee traveling on company business. A Summary Plan
Description booklet was given to you by Joe McInnes
during your last visit which further details these plans
and programs. Various cost sharing arrangements were
included in this material. You and your family, along
with other selected senior managers, will participate in
our Exec-U-Care supplemental health reimbursement
program. This program reimburses you for all expenses
not covered under our group medical, dental and vision
plan. This also carries a $250,000 Accidental Death and
Dismemberment policy. Participation in our 401(k) Plan
and Retirement Plan will be upon meeting the eligibility
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requirements in each instance. Our 401(k) Plan currently
matches 100% of the first 2% of employees' contribution,
50% of the next 2%, and 25% of the next 2%, all subject
to IRS rules.
5. You will be offered participation in our Executive Life
Insurance Program. While you are actively employed the
plan provides a death benefit of $250,000 payable to your
designated beneficiary. This is in addition to our group
term insurance coverage listed above. The Executive
Insurance would be paid up at age 65 and given to you as
paid up insurance upon your retirement from Blount on or
after age 65. Our group term insurance decreases to a
maximum $10,000 at retirement. This Executive program is
designed to offset some of the loss of group term life
insurance at retirement.
6. We will provide you an automobile under our standard
policy such as a Buick Park Avenue, Oldsmobile 98,
Chrysler New Yorker or Lincoln Continental. We normally
provide a new automobile each 40 months of 70,000 miles,
whichever occurs first. All fuel, maintenance, etc., is
provided consistent with our policy.
7. We will provide membership including initiation fees,
dues reimbursement and any assessments in the Montgomery
Country Club or Wynlakes Country Club (your choice) and
the Capital City Club (a luncheon club) for you and your
family. The country club membership may take time due to
a waiting list; however, we will work to circumvent the
lengthy waiting period in regard to your membership.
8. We will provide a furnished townhouse or apartment for
your use for three months or until you are permanently
relocated in Montgomery, whichever occurs first. Also
included will be reasonable and customary living expenses
during this three month period. We will provide an
interest-free bridge loan for a six month period for the
acquisition of a home in Montgomery, if necessary. In
anticipation of miscellaneous moving expenses not
otherwise covered, we would provide a payment of one
months compensation to take care of these incidentals.
This will be paid in conjunction with the arrival of your
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household goods in Montgomery. Blount will pay for the
packing, moving and unpacking of your household goods
from Chicago to Montgomery. Reasonable and customary
expenses for house hunting trips and returns to Chicago
during your transition period will be provided.
Nondeductible relocation expenses as well as points you
are required to pay on a home mortgage in Montgomery will
be reimbursed and grossed-up for tax consequences.
9. Your agreement will be on an annual basis and shall be
extended one day for each day worked until you attain age
64. The agreement may be terminated by either party upon
30 days written notice. If your employment is terminated
by Blount during your first twelve months of employment
for any reason except for cause (as defined below),
Blount will continue to pay your base salary for 6 months
after such termination offset by any salary earned in
subsequent employment during the 6 month payment period.
If termination, except for cause, occurs after your first
anniversary date but before your second anniversary date,
Blount will pay you 12 months severance pay. After your
second anniversary date, your severance, as above, would
be for 18 months. During any severance period you would
be provided office space, secretarial assistance and
related expenses if necessary. Termination for cause
would include, but would not be limited to, the following
conduct:
(1) Any act that is materially contrary to the
best interests of the company or its
affiliated entities including fraud,
conviction of a felony or gross malfeasance.
(2) Willful and continued failure by you to devote
your full business time and efforts to the
business affairs of the company, except that
you may serve as a director of other
corporations if such service involves no
conflict of interest, is within reasonable
time commitments, and permission to do so is
obtained from the President and Chief
Executive Officer of Blount, Inc.
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10. In addition to the consideration above, we will provide
for an annual physical examination and a consultant for
personal financial and tax planning. A separate
agreement covering confidentiality and disclosure matters
will need to be signed as you begin employment.
11. This entire offer is contingent on completion of a
physical examination.
Dick, we believe that you and your family will find Montgomery to
be a very fine environment in which to live and work. We all look
forward to your coming on both a personal and professional basis.
This letter outlines our offer which we believe is an outstanding
compensation package. If you agree with the items as outlined
above, please sign one of the copies and return to me at your
earliest convenience. This offer will remain valid until the
earlier of your acceptance or March 15, 1995. Upon your acceptance
of this letter of understanding, we will formalize our agreement in
our standard employment contract which covers change of control and
other matters.
We look forward to having you and Kitty with us.
Sincerely,
Date:__March 16, 1995____ Accepted:_/s/Richard H. Irving, III_