Exhibit 10.2
EXECUTIVE SUPPLEMENTAL RETIREMENT AGREEMENT
     THIS SUPPLEMENTAL RETIREMENT AGREEMENT (this “Agreement”), is entered into
as of the 15th day of November, 2006, by and between THE LAMSON & SESSIONS CO.,
an Ohio corporation with its principal offices at Cleveland, Ohio (the
“Company”), and Michael J. Merriman, Jr. (“Executive”);
WITNESSETH:
     WHEREAS, Executive is presently employed by the Company in a key executive
position and possesses substantial talent, ability and unique business
experience which has been and will continue to be of great value to the Company;
and
     WHEREAS, the Company desires to supplement Executive’s retirement and
disability benefits commensurate with his experience and value to the Company;
     NOW, THEREFORE, the Company and the Executive hereby agree to the terms of
the Agreement as follows:
     1. DEFINITIONS. For purposes of this Agreement, the following terms shall
have the following meanings:
          1.1 A “Change of Control” shall be deemed to have occurred if any of
the following events shall occur, and if such event constitutes a change in the
ownership or control of the Company, or in the ownership of a substantial
portion of the assets of the Company (for purposes of Section 409A of the Code):
               (a) The acquisition by any individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (the “Exchange Act”)) (a “Person”) of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty
percent (20%) or more of either: (A) the then-outstanding shares of common stock
of the Company (the “Company Common Stock”) or (B) the combined voting power of
the then-outstanding voting securities of the Company entitled to vote generally
in the election of directors (“Voting Stock”); provided, however, that for
purposes of this subsection (a), the following acquisitions shall not constitute
a Change of Control: (i) any acquisition directly from the Company, (ii) any
acquisition by the Company, (iii) any acquisition by any employee benefit plan
(or related trust) sponsored or maintained by the Company or any subsidiary of
the Company, or (iv) any acquisition by any Person pursuant to a transaction
which complies with clauses (i), (ii), and (iii) of subsection (c) of this
Section; or
               (b) Individuals who, as of the date hereof, constitute the Board
of Directors of the Company (the “Incumbent Board”) cease for any reason (other
than death or disability) to constitute at least a majority of the Board of
Directors of the Company; provided, however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Company’s shareholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board (either by a
specific vote or by approval of the proxy statement of the Company in which such
person is named as a nominee for

 

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director, without objection to such nomination) shall be considered as though
such individual were a member of the Incumbent Board, but excluding for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest (within the meaning of
Rule 14a-11 of the Exchange Act) with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or consents by
or on behalf of a Person other than the Board of Directors of the Company; or
               (c) Consummation of a reorganization, merger or consolidation or
sale or other disposition of all or substantially all of the assets of the
Company (a “Business Combination”), in each case, unless, following such
Business Combination, (i) all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the Company Common
Stock and Voting Stock immediately prior to such Business Combination
beneficially own, directly or indirectly, more than fifty percent (50%) of,
respectively, the then-outstanding shares of common stock and the combined
voting power of the then-outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the entity
resulting from such Business Combination (including, without limitation, an
entity which as a result of such transaction owns the Company or all or
substantially all of the Company’s assets either directly or through one or more
subsidiaries) in substantially the same proportions relative to each other as
their ownership, immediately prior to such Business Combination, of the Company
Common Stock and Voting Stock of the Company, as the case may be, (ii) no Person
(excluding any entity resulting from such Business Combination or any employee
benefit plan (or related trust) sponsored or maintained by the Company or such
entity resulting from such Business Combination) beneficially owns, directly or
indirectly, twenty percent (20%) or more of, respectively, the then-outstanding
shares of common stock of the entity resulting from such Business Combination,
or the combined voting power of the then-outstanding voting securities of such
corporation except to the extent that such ownership existed prior to the
Business Combination and (iii) at least a majority of the members of the board
of directors of the corporation resulting from such Business Combination were
members of the Incumbent Board at the time of the execution of the initial
agreement, or of the action of the Board of Directors of the Company, providing
for such Business Combination; or
               (d) Approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company.
          1.2 “Code” shall mean the Internal Revenue Code of 1986, as amended,
and any successor thereto.
          1.3 “Company” shall mean the Company and any of its divisions and
subsidiaries.
          1.4 “Eligible” shall mean that Executive shall have attained age
fifty-five (55) and shall have completed five (5) years of continuous employment
with the Company; provided, however, that if a Change of Control shall have
occurred, Executive shall be deemed to be “Eligible” for all purposes of this
Agreement regardless of his age or length of employment with the Company.

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          1.5 Termination “For Cause” shall mean prior to any termination of
employment by the Company, Executive shall have committed:
               (a) an intentional act of fraud, embezzlement or theft in
connection with his duties or in the course of his employment with the Company;
               (b) intentional wrongful damage to property of the Company; or
               (c) intentional wrongful disclosure of secret processes or
confidential information of the Company;
and any such act shall have been materially harmful to the Company. For purposes
of this Agreement, no act, or failure to act, on the part of Executive shall be
deemed “intentional” if it was due primarily to an error in judgment or
negligence, but shall be deemed “intentional” only if done, or omitted to be
done, by Executive not in good faith and without reasonable belief that his
action or omission was in the best interest of the Company. Notwithstanding the
foregoing, Executive shall not be deemed to have been terminated “For Cause”
hereunder unless and until there shall have been delivered to Executive a copy
of a resolution duly adopted by the affirmative vote of not less than
three-quarters of the Board of Directors of the Company then in office at a
meeting of the Board of Directors of the Company called and held for such
purpose (after reasonable notice to Executive and an opportunity for Executive,
together with his counsel, to be heard before the Board of Directors of the
Company), finding that, in the good faith opinion of the Board of Directors of
the Company, Executive had committed an act set forth above in this Section and
specifying the particulars thereof in detail. Nothing herein shall limit the
right of Executive or his beneficiaries to contest the validity or propriety of
any such determination.
          1.6 “Key Employee” shall mean a key employee as defined in
Section 409A of the Code and Section 416(i) of the Code (without regard to
paragraph (5) thereof) of the Company or a subsidiary thereof.
          1.7 “Normal Retirement Date” shall mean the first day of the month
coincident with or next following Executive’s attainment of age sixty-five (65).
          1.8 “Other Plan Benefit” shall mean a benefit payable to Executive
under any defined benefit plan sponsored by the Company, any of its divisions or
subsidiaries (“Other Plan”), calculated as if payable to Executive on a life
annuity basis commencing on the date supplemental benefits commence to Executive
under this Agreement (irrespective of any deferral of the commencement of
payment of such benefits thereunder).
          1.9 “Permanent Disability” shall mean permanent and total disability
as determined under the Company’s Long-Term Disability Plan (the “LTD Plan”).
          1.10 “Retirement Plan” shall mean The Lamson & Sessions Co. Salaried
Employees’ Retirement Plan, as amended from time to time.
          1.11 “Retirement Plan Benefit” shall mean the amount that would be
payable to Executive under the Retirement Plan pursuant to the terms thereof,
assuming for purposes of this

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Agreement that Executive became a participant in such Retirement Plan on his
date of hire, and assuming further that the following Code limitations do not
apply:
               (a) the limitations on the annual amount of benefits imposed by
Section 415 of the Code, or
               (b) any limitation imposed by Section 401(a)(17) of the Code on
the amount of compensation taken into account under the Retirement Plan or any
Other Plan.
Such benefit shall be determined on a life annuity basis, commencing on the date
supplemental benefits commence to Executive under this Agreement.
Notwithstanding the foregoing, Executive shall be credited with two (2) Years of
Credited Service for every one (1) year, or part thereof, of continuous
employment he completes, until such time as the Executive is credited with a
total of twenty (20) Years of Credited Service. Thereafter, he shall be credited
with one (1) Year of Credited Service for every year, or part thereof, of
continuous employment he completes.
          1.12 “Termination of Employment” shall mean a separation from service
as defined under Section 409A of the Code, as amended, and the guidance issued
thereunder.
          1.13 “Year of Credited Service” shall have the meaning set forth in
the Retirement Plan.
     2. SUPPLEMENTAL RETIREMENT BENEFITS
          2.1 Retirement at Normal Retirement Date. Upon Executive’s retirement
on or after his Normal Retirement Date, and provided he is Eligible on the date
of such retirement, Executive shall be entitled to receive a supplemental
retirement benefit from the Company. Such supplemental retirement benefit shall
commence as soon as administratively possible following Executive’s Termination
of Employment subject to Section 4 of this Agreement and shall be paid, on a
life annuity basis, in an amount equal to the Retirement Plan Benefit
(determined solely for purposes of Sections 5.1(b), 5.2(a)(i)(A)(2),
5.2(a)(i)(B)(2), 5.2(a)(ii)(B) and 8.2 of the Retirement Plan as if he had
completed thirty (30) years of continuous employment with the Company on or as
of the date of his retirement) minus his Other Plan Benefit, if any.
          2.2 Termination of Employment Other Than For Cause Or As a Result of
Death Or Disability. In the event that Executive’s employment with the Company
shall be terminated prior to his Normal Retirement Date other than For Cause or
by reason of his death or Permanent Disability, and provided he is Eligible on
the date of such termination, Executive shall be entitled to receive a
supplemental retirement benefit from the Company. Such supplemental retirement
benefit shall commence as soon as administratively possible following the
earliest to occur of (i) Executive’s Normal Retirement Date or (ii) his
Termination of Employment after either a Change of Control or Executive’s
completion of five (5) years of continuous service and attainment of age
fifty-five (55), subject to Section 4 of this Agreement, and shall be paid, on a
life annuity basis, in an amount determined pursuant to the following formula:

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               (a) The Retirement Plan Benefit (determined solely for purposes
of Sections 5.1(b), 5.2(a)(i)(A)(2), 5.2(a)(i)(B)(2), 5.2(a)(ii)(B) and 8.2 of
the Retirement Plan as if he had completed thirty (30) years of continuous
employment with the Company on or as of the date of his termination and as if
his retirement benefits had commenced as of his Termination of Employment, but
extending the reduction table in Section 8.2 of the Retirement Plan from age
fifty-five (55) to Executive’s earlier age at Termination of Employment, if
Executive’s employment is terminated before he attains age fifty-five
(55) following a Change of Control, such extension to provide for a reduction of
seven percent (7%) for each year that Executive’s age at the time he terminates
employment is less than age fifty-five (55), multiplied by
               (b) A fraction, the numerator of which shall be the number of
years of the Executive’s continuous employment with the Company until his
termination and the denominator of which shall be the number of years of
continuous employment Executive would have had if he had remained employed by
the Company until his Normal Retirement Date (provided, however, that if
Executive shall have attained age sixty-two (62), the fraction referred to in
this Section shall be equal to one (1)); minus
               (c) Executive’s Other Plan Benefit, if any.
     3. DISABILITY BENEFITS.
          3.1 Pre-Retirement Disability Benefit. In the event that Executive
incurs a Termination of Employment with the Company by reason of his Permanent
Disability and becomes eligible for payments under the LTD Plan by reason of
such Permanent Disability, and provided he is Eligible on the date of his
Termination of Employment, the Company shall pay Executive, commencing on the
date payments under the LTD Plan commence but subject to Section 4.1 below, a
supplemental disability benefit, on a monthly basis, in an amount determined
pursuant to the following formula:
               (a) Sixty percent (60%) of the Executive’s basic monthly earnings
(as defined in the LTD Plan); minus
               (b) Monthly disability benefits paid under the LTD Plan; minus
               (c) Other income benefits (as defined in the LTD Plan), except
family Social Security benefits and the benefits payable to Executive under this
Agreement.
Such supplemental disability payments shall continue until the cessation of
disability benefits under the LTD Plan.
          3.2 Post-Retirement Disability Benefit. In the event that Executive’s
employment with the Company shall be terminated by reason of his Permanent
Disability and he would have thereafter become eligible for a disability
retirement benefit pursuant to Section 6.5 of the Retirement Plan (assuming
Executive was a participant therein), and provided he is Eligible on the date of
termination, the Company shall pay Executive, commencing upon the later of his
Normal Retirement Date or the date upon which pre-retirement disability benefits
payable under Section 3.1 cease, a supplemental retirement benefit, on a life
annuity basis, in an amount determined pursuant to the formula set forth in
Section 2.1 of this Agreement.

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     4. TIME OF PAYMENT.
          4.1 Restriction On Key Employees. Notwithstanding any provision of
this Agreement to the contrary, Executive’s status as a Key Employee requires
the payment of Executive’s supplemental retirement benefit received on account
of Termination of Employment to commence on the first day of the seventh month
following such Termination of Employment (or, if earlier, the date of death).
          4.2 Acceleration Prohibited. The acceleration of the time or schedule
of any payment due under this Agreement is prohibited except as provided in
regulations and administrative guidance promulgated under Section 409A of the
Code.
     5. METHODS OF PAYMENT. If on the date benefits under Section 2 commence
Executive is not married, such benefits shall be paid in the Life Annuity Form
described in Article VII of the Retirement Plan. If on the date such benefits
commence Executive is married, such benefits shall be paid in the Spouse’s
Annuity Form described in Article VII of the Retirement Plan.
     6. POST-DEATH BENEFITS.
          6.1 Death of Executive After Commencement of Supplemental Retirement
Benefits. In the event of the death of Executive on or after the date benefits
under Section 2 commence, the Company shall pay to Executive’s beneficiary or
beneficiaries the death benefit (including Spouse’s Annuity), if any, provided
under the form of payment pursuant to which Executive was receiving benefits
pursuant to Section 5, commencing on the first day of the month following the
month in which Executive dies.
          6.2 Death of Executive Prior to Retirement While Married. In the event
of the death of Executive while he is in the employment of the Company or a
division or subsidiary thereof, after attainment of age fifty-five (55), while
he is married, and prior to his retirement, the Company shall pay to Executive’s
surviving spouse, commencing on the first day of the month following the month
in which Executive dies, a supplemental spouse’s benefit, on a life annuity
basis, in an amount determined and calculated as follows:

  (a)   (i)   The death benefit (including Spouse’s Annuity) which would have
been payable under Section 9.2 of the Retirement Plan (assuming Executive was a
Participant therein), without regard, however, to

  (A)   the limitations on the annual amount of benefits set forth in Article XV
of the Retirement Plan, or     (B)   any limitation imposed by
Section 401(a)(17) of the Code on the amount of compensation taken into account
under the Retirement Plan or any Other Plan,

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      (determined solely for purposes of Sections 5.1(b), 5.2(a)(i)(A)(2),
5.2(a)(i)(B)(2), 5.2(a)(ii)(B), and 8.2 of the Retirement Plan as if he had
completed thirty (30) years of continuous employment with the Company and had
retired on or as of the date of his death), multiplied by

  (ii)   A fraction, the numerator of which shall be the number of years of the
Executive’s continuous employment with the Company until his date of death and
the denominator of which shall be the number of years of continuous employment
Executive would have had if he had remained employed by the Company until his
Normal Retirement Date (provided, however, that if Executive shall have attained
age sixty-two (62)), the fraction referred to in this Section shall be equal to
one (1)); minus

  (b)   Any Other Plan Benefit payable to the surviving spouse.

     7. FORFEITURE OF BENEFITS.
          7.1 Termination For Cause. In the event that the Company shall at any
time terminate Executive’s employment For Cause, it is hereby agreed that the
Company shall have no obligation under this Agreement of any nature whatsoever
and that Executive’s rights and the rights of his beneficiary or beneficiaries
hereunder shall be completely and totally forfeited.
          7.2 Termination of Employment Prior to Executive Becoming Eligible. In
the event that Executive’s employment with the Company shall be terminated for
any reason prior to Executive’s becoming Eligible, it is hereby agreed that the
Company shall have no obligation under this Agreement of any nature whatsoever
and that Executive’s rights and the rights of his beneficiary or beneficiaries
hereunder shall be completely and totally forfeited.
          7.3 Violation of Noncompetition Clause. In the event that Executive
shall engage in conduct which constitutes a violation of Section 8 of this
Agreement, the Company shall be free from any obligation to make any payments
provided for under this Agreement to Executive or to Executive’s beneficiaries,
and any and all such payments shall cease.
     8. LIMITATIONS AND RESTRICTIONS ON COMPETITION. During a period ending on
the date of the first to occur of either the attainment by Executive of age
sixty-five (65) or one (1) year following termination of Executive’s employment
with the Company for any reason, Executive shall not, without the prior written
consent of the Company, engage in any Competitive Activity. For purposes of this
Agreement, “Competitive Activity” shall mean Executive’s participation, without
the written consent of the Company, in the management of any business enterprise
if such enterprise engages in substantial and direct competition with the
Company and such enterprise’s sales of any product or service competitive with
any product or service of the Company amount to twenty-five percent (25%) of
such enterprise’s net sales for its most recently completed fiscal year and if
the Company’s net sales of said product or service amounted to twenty-five
percent (25%) of the Company’s net sales for its most recently

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completed fiscal year. “Competitive Activity” shall not include (i) the mere
ownership of securities in any such enterprise and the exercise of rights
appurtenant thereto or (ii) participation in the management of any such
enterprise other than in connection with the competitive operations of such
enterprise.
     9. MISCELLANEOUS PROVISIONS.
          9.1 Assignment. This Agreement shall be binding upon and shall inure
to the benefit of the Company and its successors and assigns. No right or
interest under this Agreement of Executive (or any person claiming through or
under Executive) other than the surviving spouse of Executive after he is
deceased shall be assignable or transferable in any manner or be subject to
alienation, anticipation, sale, pledge, encumbrance or other legal process or in
any manner be liable for or subject to the debts or liabilities of Executive.
          9.2 Interpretation. All questions of interpretation, construction or
application arising under this Agreement shall be decided by the Board of
Directors of the Company, whose decision shall be final and conclusive upon all
persons.
          9.3 Savings Clause. In the event that any provision or term of this
Agreement is finally determined by any judicial, quasijudicial or administrative
body to be void or not enforceable for any reason, it is the intent of the
parties hereto that all other provisions and terms of this Agreement shall
remain in full force and effect and that this Agreement shall be enforceable as
if such void or non-enforceable provision or term had never been a part hereof.
          9.4 Governing Law. This Agreement is executed in and shall be
construed in accordance with and governed by the laws of the State of Ohio
without giving effect to any provision of such laws regarding choice of laws or
conflict of laws.
          9.5 No Rights in Any Property of Company. The undertakings of the
Company herein constitute merely the unsecured promise of the Company to make
the payments as provided for herein; no property of the Company is or shall, by
reason of this Agreement, be held in trust for Executive, any beneficiary or any
other person; and neither Executive nor any beneficiary nor any other person
shall have by reason of this Agreement any right, title or interest of any kind
in or to any property of the Company. It is intended that (i) this Agreement
shall be “unfunded” for purposes of Title I of the Employee Retirement Income
Security Act of 1974, as amended, (ii) nothing in this Agreement shall currently
constitute a transfer of property for purposes of Section 83 of the Code, or any
successor provision thereto, or shall cause a currently taxable benefit to be
realized by Executive or his beneficiaries pursuant to the “economic benefit”
doctrine and (iii) pursuant to Section 451 of the Code, or any successor
provision thereto, amounts payable pursuant to this Agreement will be includable
in the gross income of Executive or his beneficiaries in the taxable year or
years in which such amounts are actually distributable or made available to
Executive or his beneficiaries.
          9.6 Employment of Executive by Company. Nothing herein shall be
construed as an offer or commitment by the Company to continue Executive’s
employment with the Company for any period of time.

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          9.7 Termination by the Company. The Company may terminate this
Agreement at any time; provided, however, that no such termination shall
adversely affect the rights or benefits accrued by Executive (whether or not
vested) under this Agreement prior to his receipt of notice of such termination.
          9.8 Taxes. Notwithstanding the foregoing, the Company shall not be
obligated to guarantee any particular tax result for Executive with respect to
any income recognized by Executive in connection herewith, and Executive shall
be responsible for any taxes imposed on Executive in connection herewith.
          9.9 Compliance with Section 409A of the Code. It is intended that this
Agreement comply with the provisions of Section 409A of the Code. The Agreement
shall be administered in a manner consistent with this intent, and any provision
that would cause the Agreement to fail to satisfy Section 409A of the Code shall
have no force and effect until amended to comply with Section 409A of the Code
(which amendment may be retroactive to the extent permitted by Section 409A of
the Code and may be made by the Company without the consent of Executive).
          9.10 Notices. All notices, requests, consents and other communications
hereunder shall be in writing and shall be deemed to have been duly given when
received. All such communications shall be addressed as follows:
     If to the Company, to:
The Lamson & Sessions Co.
25701 Science Park Drive
Cleveland, Ohio 44122
Attention: Secretary
     If to Executive, to:
The Lamson & Sessions Co.
25701 Science Park Drive
Cleveland, Ohio 44122
Attention: Michael J. Merriman
provided, however, that if any party or his or its successors shall have
designated a different address by written notice to the other party, then to the
last address so designated.
[SIGNATURES ON FOLLOWING PAGE]

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     IN WITNESS WHEREOF, the parties hereto have hereunto set their hands as of
the day and year first above written.

            THE LAMSON & SESSIONS CO.
      By:   /s/ John B. Schulze         Name:   John B. Schulze        Title: 
Chairman of the Board              /s/ Michael J. Merriman, Jr.       Michael J.
Merriman, Jr.           

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