EXHIBIT 10.1


 


FORM
OF RETENTION AGREEMENT


 


This Agreement is entered into as of February 22, 2005
by and between Lenox, Incorporated, a New Jersey corporation (“Employer”) and                                                               
(“Employee”) as follows:


 


WHEREAS, Employer and Employee have previously entered
into a Retention Agreement providing incentive compensation for Employee in
order to promote continuity of Employer’s management and retention of Employee
as one of Employer’s key executives in the event of a Sale of Employer (as
defined herein); and


 


WHEREAS, Employer and Employee desire to amend and
restate the Retention Agreement in its entirety;


 


NOW, THEREFORE, Employer and Employee hereby agree
that the previous Retention Agreement issued in November, 2004 is revoked, and
further agree as follows:


 


1.             Definitions.


 


(a)           “Cause” means any of the following:


 


(1)           serious,
willful misconduct, dishonesty or disloyalty by Employee, directly related to
performance of Employee’s duties for Employer and likely to result in material
harm to the operations, financial condition or reputation of Employer;


 


(2)           Employee
is convicted of (or enters into a plea bargain admitting) a felony.


 


(b)           “Closing Date” means the date the Sale of
Employer is consummated.


 


(c)           “Effective Date” means the date set forth
at the beginning of this Agreement.


 


(d)           “Good Reason” means any of the following
occurring on or after the Closing Date:


 


(1)           there
is a material reduction of Employee’s title, job duties or responsibilities;


 


(2)           Employee’s
base annual salary is reduced by 5% or more below the base annual salary as of
the Effective Date;


 


(3)           Employee’s
principal place of work is relocated by a distance of 50 miles or more;


 


(4)           Employee
is required to work more than ten days per month outside of Employee’s current
principal place of work for a period of six consecutive months.


 





















 


(e)           “Purchaser” means the person (or persons)
or entity (or entities) which becomes the owner of Employer or succeeds
Employer as the owner or operator of the business, operations and/or assets of
Employer as a result of the Sale of Employer.


 


(f)            “Sale of Employer” means the sale (whether
for cash, stock or otherwise) of at least a majority of the capital stock,
business, operations and/or assets of Employer, in a transaction or series of
transactions with a Purchaser which is not an affiliate of Employer immediately
prior to such transaction or series of transactions.


 


2.             Retention
Bonus.


 


(a)           Subject
to the terms and conditions of this Agreement, Employer will pay a “Retention Bonus” in the amount of $            
to Employee if Employee is employed by Employer on the Closing Date and
either


 


(1)           Employee
is employed by Employer, the Purchaser or one of their affiliates on the first
anniversary of the Closing Date;


 


(2)           Employer,
the Purchaser or their affiliate terminates Employee’s employment, other than
for Cause, prior to the first anniversary of the Closing Date (for which
purpose a transfer of employment within the group of Employer, Purchaser and
other affiliates of Purchaser will not be treated as a termination of
employment);


 


(3)           Employee
resigns with Good Reason prior to the first anniversary of the Closing Date; or


 


(4)           Employee,
while employed by Employer, the Purchaser or their affiliate, ceases employment
prior to the first anniversary of the Closing Date by reason of being “totally
disabled” (meaning Employee is unable to perform the material and substantial
duties of Employee’s regular occupation due to sickness or injury that is expected
to last one year or more), or by reason of Employee’s death.


 


(b)           If
the Retention Bonus becomes payable, it will be paid in one lump sum cash
payment within 30 days after the occurrence of the first applicable event
specified in Paragraph 2(a) above.


 


3.             Severance
Benefit.


 


(a)           If
the Retention Bonus becomes payable under the circumstances described in
Paragraph 2(a)(2) or 2(a)(3) above, then Employer shall also pay a “Severance Benefit” to Employee in
accordance with this Paragraph 3.


 


(b)           The
cash amount of the Severance Benefit will be equal to twelve months of Employee’s
base salary calculated on the basis of the higher of (i) Employee’s
annualized salary rate as of the Effective Date, or (ii) Employee’s
annualized salary rate in effect at the date of termination.  Employer may pay the Severance Benefit in
installments in accordance with its normal payroll practices over the specified
number of months following termination.


 


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(c)           The
Severance Benefit will also include continuation of Employee’s health care
coverage(s) in effect at the time of termination (subject to such changes in
coverage as are implemented with respect to all participants), at no cost to
Employee, for the same number of months specified in (b) above.


 


(d)           The
Severance Benefit will also include up to six months of executive outplacement
services with a national provider such as DBM, with the cost not to exceed
$20,000.


 


(e)           For
executives provided with a company-leased vehicle for their dedicated use under
the Company Automobile Program for key executives, the Severance Benefit shall
also include the continuing use of the existing Company Automobile Program
vehicle for three months following termination under the program provisions in
effect immediately prior to the date of termination.  At the end of that three month period, the
executive must either return the vehicle to the Employer or purchase it at the
Employer’s then current depreciated value.


 


4.             Duties,
Obligations and Responsibilities of Employee.


 


Employee shall devote best efforts to faithfully
discharge Employee’s duties, obligations and responsibilities on behalf of
Employer as those duties, obligations and responsibilities have been performed
in the past or as may be subsequently modified in writing by Employer and
Employee.  In addition, Employee shall
devote best efforts to assist Employer and its current shareholder in
finalizing the Sale of Employer to a Purchaser.


 


5.             Expiration.


 


Employee understands that Employer and its shareholder
are not obligated to enter into a Sale of Employer.  If no Sale of Employer has been consummated
on or before September 30, 2005, this Agreement will expire and neither party
will have any further obligation under this Agreement.


 


6.             Non-Exclusivity.


 


The terms of this Agreement are in addition to, and
not in lieu of, the right of Employee to receive any base annual salary,
retirement or welfare benefit, perquisite, bonus or other payment provided by
Employer to Employee prior to the Sale of Employer, except for such rights as
Employee may have specifically waived in writing.  Amounts which are vested benefits or which
Employee is otherwise entitled to receive under any benefit plan or program provided
by Employer shall be payable in accordance with the terms of such plan or
program.


 


7.             Confidentiality.


 


Employee acknowledges that similar arrangements are
being made only with select key employees and are not being offered to all of
the employees of Employer.  Employee will
not disclose the existence or terms of this Agreement with other employees,
other than Employer’s Chief Executive Officer, Chief Human Resources Officer or
Chief Legal Officer.


 


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8.             Miscellaneous
Provisions.


 


(a)           All
payments under this Agreement will be subject to all applicable tax and
withholding requirements.


 


(b)           No
payment pursuant to this Agreement will be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance or
charge prior to actual receipt thereof by Employee; and any attempt to so
anticipate, alienate, sell, transfer, assign, pledge, encumber or charge prior
to such receipt shall be void.  Employer
shall not be liable in any manner for, or subject to, the debts, contracts,
liabilities, engagements or torts of Employee or any other person entitled to
any payment under this Agreement.


 


(c)           Nothing
contained herein shall confer upon Employee the right to be retained in the
service of Employer or any affiliate thereof, nor limit the right of Employer
or any affiliate thereof to discharge or otherwise deal with Employee without
regard to the existence of this Agreement.


 


(d)           Employer’s
obligations under this Agreement shall at all times be entirely unfunded and no
provision shall at any time be made with respect to segregating assets of
Employer or any affiliate thereof for payment of any amounts hereunder.  Neither Employee nor any other person shall
have any interest in any particular assets of Employer or any affiliate thereof
by reason of the right to receive amounts under this Agreement and any Employee
or any other person shall have only the rights of a general unsecured creditor
of Employer or any affiliate thereof with respect to any rights under this
Agreement.


 


IN WITNESS WHEREOF,
Employer and Employee have executed and delivered this Revised Retention
Agreement as of the Effective Date.


 


	
   

  	
  LENOX
  INCORPORATED

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
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  Employee:

  	
   

  
					



 


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