-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, P/iaD8RJxhzjL3LIO5WLjQxlVRNM8NYtyZZ1U74N3eacU7jYsv66Pmkga03k29Nr 4ltnyC4g7FS5dnUiALLcUw== 0000031107-07-000118.txt : 20071214 0000031107-07-000118.hdr.sgml : 20071214 20071214171350 ACCESSION NUMBER: 0000031107-07-000118 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20071212 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20071214 DATE AS OF CHANGE: 20071214 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EASTERN CO CENTRAL INDEX KEY: 0000031107 STANDARD INDUSTRIAL CLASSIFICATION: CUTLERY, HANDTOOLS & GENERAL HARDWARE [3420] IRS NUMBER: 060330020 STATE OF INCORPORATION: CT FISCAL YEAR END: 0102 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-00599 FILM NUMBER: 071308088 BUSINESS ADDRESS: STREET 1: 112 BRIDGE ST STREET 2: P O BOX 460 CITY: NAUGATUCK STATE: CT ZIP: 06770 BUSINESS PHONE: 2037292255 MAIL ADDRESS: STREET 1: 112 BRIDGE STREET STREET 2: P O BOX 460 CITY: NAUGATUCK STATE: CT ZIP: 06770 8-K 1 form8klfl_amend.txt LFL AMENDMENTS 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: December 12, 2007 -------------------------------- (Date of earliest event reported) The Eastern Company ------------------- (Exact name of Registrant as specified in its charter) Connecticut 0-599 06-0330020 ----------- ----- ---------- (State or other jurisdiction (Commission File Number) (IRS Employer of incorporation) Identification No.) 112 Bridge Street, Naugatuck, Connecticut 06770 - ----------------------------------------- ----- (Address of principal executive offices) (Zip Code) (203) 729-2255 -------------- (Registrant's telephone number, including area code) 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 (see General Instruction A.2) [ ] 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 4d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 3e-4(c) under the Exchange Act (17 CFR 240.13e-4( c)) Section 1 - Registrant's Business and Operations ITEM 1.01 - Entry into a Material Definitive Agreement On December 12, 2007, The Eastern Company Compensation Committee executed an amendment to the Employment Agreement (the "Agreement") with the Company's Chairman, President and Chief Executive Officer, Leonard F. Leganza. The amendment: (a) establishes December 1, 2008, in place of separation of service, as the commencement date for the deferred compensation payments which are to be paid over a 60 month period; (b) revised the definition of change in control to incorporate the requirements of Code Section 409A; (c) reflects Mr. Leganza's current position as Chairman of the Board, President and Chief Executive Officer; and (d) addresses other requirements of Code Section 409A. On December 12, 2007, The Eastern Company Compensation Committee executed an amendment to the Supplemental Retirement Plan for the Chief Executive Officer of The Eastern Company (the "SERP"), which the Company maintains for the benefit of Leonard F. Leganza, its Chief Executive Officer. The amendment reflects various requirements of Code Section 409A. Copies of the amendment to the Agreement and the amendment to the SERP are attached as Exhibit 99. Section 5 - Corporate Governance and Management ITEM 5.02 - (e) Compensatory Arrangements of Certain Officers On December 12, 2007, the Company amended the Agreement to establish a date for commencement of Deferred Compensation payments and to reflect various requirements of Code Section 409A. See Item 1.01 above. On December 12, 2007, the Company amended the SERP to reflect various requirements of Code Section 409A. See Item 1.01 above. Section 9 - Financial Statements and Exhibits ITEM 9.01 - (d) Exhibits (99.1) Amendment to Employment Agreement between The Eastern Company and Leonard F. Leganza, the Company's Chairman, President and Chief Executive Officer, executed on December 12, 2007. (99.2) Amendment to Suppliemental Retirement Plan for the Chief Executive Officer of The Eastern Company, executed on December 12, 2007. 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. The Eastern Company Date: December 14, 2007 By: /s/John L. Sullivan III ------------------ ---------------------------- John L. Sullivan III Vice President and Chief Financial Officer EX-99 2 ex99_1agree.txt EXHIBIT 99.1 LFL AGREEMENT AMEND Exhibit 99.1 AMENDMENT TO EMPLOYMENT AGREEMENT AGREEMENT made as of the 12th day of December , 2007 by and between THE EASTERN COMPANY, a corporation organized under the laws of the State of Connecticut (the "Company"), and LEONARD F. LEGANZA, of 62 Tunxis Village Road, Farmington, Connecticut (the "Executive"). W I T N E S S E T H: ------------------- WHEREAS, as of January 1, 2005 the Company entered into an employment agreement with the Executive (the "Agreement") pursuant to which the Executive serves as the chairman of the board, president and chief executive officer of the Company; and WHEREAS, by an amendment to the Agreement dated October 24, 2007, the term of the Agreement was extended until December 31, 2008; and WHEREAS, the Company wishes to provide: (a) that the deferred compensation payable to the Executive under the Agreement will commence on a specified date; and (b) that the change in control benefit will be paid to the Executive upon the occurrence of a change in control, whether or not the Executive terminates employment; and WHEREAS, the Company also wishes to amend the Agreement to satisfy the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the "Code"). NOW, THEREFORE, the Company and the Executive do hereby agree as follows, effective as of the date of adoption of this amendment: (1) Section 1(g) of the Agreement is deleted and the following is substituted in lieu thereof: (g) Change in Control shall mean a change in ownership of the Company, a change in effective control of the Company, or a change in the ownership of a substantial portion of the assets of the Company. (i) A change in ownership of the Company occurs when any person (or two or more persons acting as a group) acquires ownership of stock of the Company which, together with stock held by such person or group, constitutes more than fifty percent (50%) of the total voting power of the stock of the Company. However, if any person or group of persons is considered to own more than fifty percent (50%) of the total voting power of the stock of the Company, the acquisition of additional stock by the same person or group of persons is not considered to result in a change in ownership of the Company. (ii) A change in effective control of the Company occurs either: (A) when any person (or two or more persons acting as a group) acquires (or has acquired during the preceding twelve month period) ownership of stock of the Company possessing fifty percent (50%) or more of the total voting power of the stock of the Company; or (B) a majority of the board of directors of the Company is replaced during a twelve month period by persons who are not endorsed by a majority of the board of directors of the Company in office prior to such change. However, if any person or group of persons is considered to have acquired effective control of the Corporation pursuant to this Section 1(g)(ii), the acquisition of additional control of the Company by the same person or group of persons is not considered to result in a change in effective control of the Company. (iii) A change in ownership of a substantial portion of the assets of the Company occurs on the date that any one person (or two or more persons acting as a group) acquires (or has acquired during the preceding twelve month period) assets from the Company that have a total gross fair market value equal to or greater than sixty percent (60%) of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions. Gross fair market value means the value of the assets of the Company, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets. (2) Section 2 of the Agreement is deleted and the following is substituted in lieu thereof: Section 2. Position The Company hereby employs the Executive, and the Executive hereby accepts employment, as Chairman of the Board, President and Chief Executive Officer of the Company through the end of the term of this Agreement. The Executive agrees to serve in the positions described above and to devote his full working time, attention and energies to the performance of the duties described in Section 3: (i) except for vacations in accordance with Section 5(e) hereof and absences due to temporary illness; and (ii) except that the foregoing shall not preclude the Executive from serving on the boards of a reasonable number of trade associations, for-profit corporations and charitable organizations and engaging in charitable activities and community affairs, provided such activities collectively do not interfere with the proper performance of the Executive's duties and responsibilities hereunder. (3) Section 3 of the Agreement is deleted and the following is substituted in lieu thereof: Section 3. Authority, Responsibilities and Duties. The Executive shall have such authority, responsibilities and duties as generally pertain to the offices of Chairman of the Board, President and Chief Executive Officer of the Company, and shall have such other authority, responsibilities and duties as may reasonably be assigned from time to time by the Board of Directors of the Company or its designee. (4) The title of Section 6 of the Agreement and the introductory paragraph of Section 6 of the Agreement are deleted and the following are substituted in lieu thereof: Section 6. Deferred Compensation and Change in Control Benefit The Executive shall be entitled to receive the following benefits: (5) Section 6(a) of the Agreement is deleted and the following is substituted in lieu thereof: (a) Deferred Compensation. The Executive shall be entitled to receive the deferred compensation described in this Section 6(a) (unless the Company terminates the Executive's employment for Cause). (i) The amount of the deferred compensation payable to the Executive shall equal the Deferred Benefit. The Company shall commence payment of the deferred compensation described in this Section 6(a)(i) on December 1, 2008, and the payment of the deferred compensation shall thereafter continue on the first day of each month for a period of sixty (60) consecutive months. (ii) If the Executive dies prior to the commencement of the deferred compensation, the Executive's Beneficiary shall receive the Deferred Benefit. The Deferred Benefit shall commence on the first day of the month following the Executive's death and shall be payable until the end of a period of sixty (60) consecutive months or until the death of the Executive's Beneficiary (whichever occurs first). If the Executive dies after commencing to receive the deferred compensation described in Section 6(a)(i) but before the receipt of sixty (60) consecutive monthly payments, the balance of said payments shall be paid to the Executive's Beneficiary until the remainder of such sixty (60) consecutive monthly payments have been paid or until the death of the Executive's Beneficiary (whichever occurs first). (6) Section 6(b) of the Agreement is amended by adding a new Section 6(b)(iii) to read as follows: (iii) As required by Code Section 409A: (A) the post-retirement medical benefits payable under this Section 6(b) are objectively determinable; (B) such post-retirement medical benefits are provided for a specified period (i.e., the lifetime of the Executive and his spouse); (C) the amount of the post-retirement medical benefits provided in one year does not affect the amount of the post-retirement medical benefits available in another year (except for the applicability of annual or lifetime caps); (D) the reimbursement of any post-retirement medical expenses must be made no later than the end of the year following the year in which the expenses were incurred; and (E) the right to receive the post-retirement medical benefits is not subject to liquidation or exchange for another benefit. (7) Section 6(c) of the Agreement is deleted and the following is substituted in lieu thereof: (c) Change in Control Benefit. If a Change in Control of the Company occurs, then the Company shall pay to the Executive a change in control benefit equal to 2.99 times the Executive's Average Adjusted Compensation. Average Adjusted Compensation shall be determined as of the date of the Change in Control. The change in control benefit described in this Section 6(c) shall be paid to the Executive in a single lump sum amount within thirty (30) days following the date on which the Change in Control of the Company occurs. If a Change in Control occurs, the change in control benefit described in this Section 6(c) shall be paid in addition to the deferred compensation described in Section 6(a), the post-retirement medical benefits described in Section 6(b), and any other benefits or payments to which the Executive is entitled under the terms of any agreement, plan or policy established by the Company. In addition, the Executive shall receive the deferred compensation described in Section 6(a), the post-retirement medical benefits described in Section 6(b) and the change in control benefit described in Section 6(c) whether or not the Executive is terminated for Cause following the Change in Control. Notwithstanding anything in this Agreement to the contrary, in the event that a Statutory Change in Control has occurred (whether or not a Change in Control has occurred) and the Total Parachute Payments are determined by the Tax Advisor not to be deductible, in whole or in part, by the Company because they exceed the Parachute Payment Limit set forth in Section 280G of the Code, then the change in control benefit described in this Section 6(c) (to the extent it is included in the Total Parachute Payments) shall be reduced until all of the Total Parachute Payments are deductible in accordance with Section 280G of the Code, or the change in control benefit described in this Section 6(c) is reduced to zero. For purposes of this limitation, no portion of the Total Parachute Payments shall be taken into account to the extent that the receipt of such payments, in the determination of the Tax Advisor, is effectively waived by the Executive prior to the date which is fifteen (15) days following the date of the Change in Control and prior to the earlier of the date of constructive receipt and the date of payment thereof. The determination of the Tax Advisor as to the deductibility of the Total Parachute Payments shall be completed not later than forty-five (45) days following the date of the Change in Control, and such determination shall be communicated in writing to the Company, with a copy to the Executive, within said forty-five (45) day period. The good faith determination of the Tax Advisor as to the deductibility of the Total Parachute Payments shall be deemed conclusive and binding on the Company and the Executive. The Company shall pay the fees and other costs of the Tax Advisor hereunder. In the event that the Tax Advisor is unable or declines to serve for purposes of making the foregoing determination, the Company shall appoint another accounting firm of national reputation to serve as the Tax Advisor, with the Executive's consent. (8) Section 6(d) of the Agreement is deleted and the following is substituted in lieu thereof: (d) Code Section 409A. The provisions of this Agreement shall in all events be interpreted in a manner consistent with the Agreement satisfying the requirements of Code Section 409A and the regulations promulgated pursuant thereto. (9) Section 7 of the Agreement is amended by deleting the first sentence and substituting the following in lieu thereof: The following provisions shall apply to the payment of the benefits described in Section 6: (10) Section 7(a) of the Agreement is deleted and the following is substituted in lieu thereof: (a) Funding. It is the intention of the Company, the Executive, his Beneficiary and each other party to this Agreement that the benefits payable under this Agreement be unfunded for tax purposes and for purposes of Title I of ERISA. The rights of the Executive and his Beneficiary to receive such benefits shall be those of a general unsecured creditor of the Company. (11) Section 10(d) of the Agreement is deleted and the following is substituted in lieu thereof: (d) Full Settlement. The Company's obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Executive or others. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement, and such amounts shall not be reduced whether or not the Executive obtains other employment. (12) All of the other terms and conditions of the Agreement are hereby confirmed, ratified and approved in all respects. IN WITNESS WHEREOF, the Company has caused this Agreement to be executed and its corporate seal to be hereunto affixed, and the Executive has hereunto set the Executive's hand and seal, as of the day and year specified above. ATTEST: THE EASTERN COMPANY /s/Theresa P. Dews By:/s/David C. Robinson - ------------------ ---------------------- Theresa P. Dews David C. Robinson Its: Secretary Title: Chairman, Compensation Committee EXECUTIVE /s/Leonard F. Leganza --------------------- Leonard F. Leganza EX-99 3 ex99_2serp.txt EXHIBIT 99.2 LFL SERP AMENDMENT Exhibit 99.2 AMENDMENT TO THE SUPPLEMENTAL RETIREMENT PLAN FOR THE CHIEF EXECUTIVE OFFICER OF THE EASTERN COMPANY THE EASTERN COMPANY, a Connecticut corporation having its principal office at 112 Bridge Street, Naugatuck, CT 06770 (hereinafter "Company"), does hereby amend its supplemental retirement plan for the benefit of its chief executive officer on the terms and conditions hereinafter set forth: W I T N E S S E T H: ------------------- WHEREAS, on September 9, 1998 the Company adopted the Supplemental Retirement Plan for the Chief Executive Officer of The Eastern Company (the "SERP") for the purpose of providing supplemental retirement benefits to the chief executive officer of the Company; and WHEREAS, the Company wishes to amend the SERP to satisfy the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the "Code"). NOW, THEREFORE, the Company does hereby amend the SERP as follows, effective as of the date of adoption of this amendment: (1) Section 2.17 of the SERP is deleted and the following is substituted in lieu thereof: 2.17 "Total and Permanent Disability" shall mean a total disability that makes the Participant eligible to receive disability benefits under Title II of the Social Security Act. (2) Section 4.2 of the SERP is deleted and the following is substituted in lieu thereof: 4.2 Payment of Retirement Benefits. The Company shall commence payment of the benefit described in Section 4.1 as of the first day of the month coinciding with or next following the date that is six months after the date of the Participant's Termination of Employment. Such benefit shall be payable in monthly installments as a Five Year Certain Annuity if the Participant is not married at the time of his Termination of Employment or as an Actuarially Equivalent 100/50 Joint and Survivor Annuity if the Participant is married at the time of his Termination of Employment. The amount of the Participant's benefit described in Section 4.1 shall be determined as if it had commenced on the first day of the month coinciding with or next following the date of the Participant's Termination of Employment. The payments to which the Participant would otherwise have been entitled during the first six months following his Termination of Employment shall then be accumulated (together with interest at the long term applicable federal rate (as defined in Section 1274(d) of the Code) for the month preceding the Participant's Termination of Employment), and shall be paid on the first day of the month coinciding with or next following the date that is six months after his Termination of Employment. (3) Section 5.2 of the SERP is deleted and the following is substituted in lieu thereof: 5.2 Amount of Disability Benefits. In the event the Participant incurs a Total and Permanent Disability prior to his Termination of Employment and is eligible to receive disability benefits under Title II of the Social Security Act, then he shall be entitled to receive disability retirement benefits under the Plan. Such benefits shall be equal to the monthly retirement benefit determined in accordance with Section 4.1 which the Participant would have been entitled to receive if he had incurred a Termination of Employment immediately prior to the date of his Total and Permanent Disability. Such benefits shall commence on the first day of the month following the date on which the Social Security Administration determines that the Participant has incurred a Total and Permanent Disability. (4) Section 7.1(a) of the SERP is deleted and the following is substituted in lieu thereof: (a) It is the intention of the Company, the Participant, his surviving Spouse and Beneficiary, and each other party to the Plan that the arrangements hereunder be unfunded for tax purposes and for purposes of Title I of ERISA. The rights of the Participant and his surviving Spouse and Beneficiary shall be those of a general unsecured creditor of the Company. (5) Section 7.1(c) of the SERP is deleted. (6) Section 8.1 of the SERP is deleted and the following is substituted in lieu thereof: 8.1 Suspension of Benefit Payments. In the event that a Participant commences receiving benefits hereunder and is subsequently reemployed on a full-time basis by the Company or any of its affiliates, the payment of benefits under this Plan shall be suspended during the period of such reemployment and shall recommence on the date on which he again incurs a Termination of Employment. The amount of the benefits payable to the Participant shall not be adjusted following the Participant's subsequent Termination of Employment. Rather, any benefits that would have been paid to the Participant during the suspension period shall be forfeited, and shall not thereafter be paid. (7) All of the other terms and conditions of the Agreement are hereby confirmed, ratified and approved in all respects. IN WITNESS WHEREOF, the undersigned has executed this amendment to the Plan on the day of December 12, 2007. ATTEST: THE EASTERN COMPANY /s/Theresa P. Dews By: /s/David C. Robinson - ------------------- --------------------- Theresa P. Dews David C. Robinson Its Secretary Title: Chairman of the Compensation Committee -----END PRIVACY-ENHANCED MESSAGE-----