Looking for an agreement? Search from over 1 million agreements now.
Home > Employment Benefits/Pension Plans > Agreement Preview

Mccrory Pension Plan

This is an actual contract by Samsonite.

Save time and money with our Premium Packages.
Buy all (8) recommended agreements for
$140.00 (50% savings)
Agreement Preview
Sectors: Consumer Products (Durables)
Governing Law: New York, View New York State Laws
Effective Date: June 20, 1996
Related Agreement Types:
Search This Document
EXHIBIT 10.5
------------


EXECUTION COPY


MCCRORY PENSION PLAN
FINAL SETTLEMENT AGREEMENT


This Agreement is made as of June 20, 1996 by and among the PBGC, McCrory, the McCrory Principal Subsidiaries, Astrum and the Astrum Subsidiaries.


RECITALS
--------


1. McCrory is the contributing sponsor (within the meaning of ERISA Section 4001(a)(13)), and the plan sponsor (within the meaning of ERISA Section 3(16)(B)), of the McCrory Pension Plan.


2. The predecessor of the McCrory Pension Plan was terminated in 1985. Benefits accrued for service performed by participants under the predecessor plan were fully annuitized through the purchase of an annuity contract from an insurance company. As a result, the McCrory Pension Plan has no liability to participants who were also participants in the predecessor plan for service performed prior to 1986. The McCrory Pension Plan provides benefits solely for service performed after 1985 and prior to July 1, 1993.


3. Since February 26, 1992, McCrory, together with twenty-seven of its subsidiaries, has been in reorganization proceedings under Chapter 11 of the Bankruptcy Code.


4. A confirmation hearing on the McCrory Plan of Reorganization has been scheduled by the Bankruptcy Court for September 30, 1996.


5. On May 12, 1993, the PBGC and the Astrum Subsidiaries entered into an Interim Extension Agreement under which, inter alia, the Astrum Subsidiaries
----- ---- agreed to be secondarily liable for certain funding obligations of the McCrory Pension Plan and the PBGC agreed to the withdrawal of all claims in the Astrum Chapter 11 Case. The Interim Extension Agreement has been extended periodically since May 12, 1993 and has continued in effect through the date hereof (as so extended, the "Interim Extension Agreement").


--


6. On May 24, 1993, the Bankruptcy Court approved a Compromise and Settlement Agreement among Astrum, McCrory and certain other parties (the "Compromise and Settlement Agreement"), as a result of which, inter alia, (i) McCrory agreed to
----- ---- freeze the McCrory Pension Plan, restrict its right to make amendments improving plan benefits, transfer plan sponsorship of the McCrory Pension Plan to Astrum or one of the Astrum Subsidiaries upon the occurrence of certain specified conditions precedent, and remain primarily liable for all obligations arising under or with respect to the McCrory Pension Plan until the date of such transfer, (ii) the Astrum Controlled Group agreed to be secondarily liable for certain contributions, premiums and liability under ERISA Section 4062 with respect to the McCrory Pension Plan during the period prior to any transfer of plan sponsorship to Astrum or one of the Astrum Subsidiaries, and to be primarily liable for such liabilities after any such transfer, and (iii) Astrum and McCrory agreed to enter into a definitive settlement agreement with the PBGC consistent with the allocation of obligations and liabilities under the Compromise and Settlement Agreement.


7. On May 25, 1993, the Bankruptcy Court confirmed the Astrum Plan of Reorganization. The Astrum Plan Consummation Date occurred on June 8, 1993. Immediately after the Astrum Plan Consummation Date, Astrum and the Astrum Subsidiaries ceased to be members of the McCrory Controlled Group.


8. The McCrory Pension Plan was frozen as of June 30, 1993, and related amendments to the McCrory Pension Plan prohibiting benefit improvements were adopted as of June 30, 1993. A duly authorized Amendment, Assignment and Assumption Agreement providing for the transfer of plan sponsorship of the McCrory Pension Plan was executed as of June 30, 1993 and placed in escrow with the law firm of Rosenman & Colin in accordance with the provisions of an Escrow Agreement dated as of June 30, 1993 (collectively, the "Escrow Agreements"). Copies of the Escrow Agreements are annexed hereto as Exhibit 1.


9. On July 14, 1995, Samsonite Corporation merged with and into Astrum International Corp., Astrum changed its name to Samsonite Corporation, and McGregor Corporation continued as a wholly-owned subsidiary of Samsonite Corporation (formerly Astrum International Corp.). On September 12, 1995, Culligan Water Technologies, Inc., owner of 100% of the stock of Culligan International Company, was spun off to shareholders pursuant to the terms of a Distribution Agreement dated July 14, 1995. The Distribution Agreement contains certain provisions allocating contingent liabilities that may arise under this Agreement


--


between the parties to the Distribution Agreement, without affecting Culligan International Company's obligations under the Interim Extension Agreement or this Agreement. For convenience of reference, except as otherwise specifically provided herein, the terms "Astrum International Corp.", "Samsonite Corporation", "McGregor Corporation" and "Culligan International Company" when used herein or defined herein, refer to the corporations which were so named during the period immediately prior to July 14, 1995, and their respective successors in interest.


10. Under Title IV of ERISA, the PBGC has authority to make arrangements with any contributing sponsors and members of their controlled groups who are or may become liable under Title IV of ERISA for payment of their liability (including arrangements for deferred payment of amounts of liability to the PBGC accruing as of the termination date) on such terms and for such periods as the PBGC deems equitable and appropriate.


NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is acknowledged by each party hereto, the parties hereto agree as follows:


1. Definitions
-----------


For purposes of this Agreement:


Astrum means Astrum International Corp., a Delaware corporation, f/k/a
------ E-II Holdings Inc.


Astrum Chapter 11 Case means Chapter 11 case number 92-B-43614(CB)
------ ------- -- ---- formerly administered by the Bankruptcy Court.


Astrum Plan Consummation Date means June 8, 1993, the date of the
------ ---- ------------ ---- distribution of new Astrum common stock to creditors in accordance with the Astrum Plan of Reorganization.


Astrum Plan of Reorganization means the final Second Amended Plan of
------ ---- -- -------------- Reorganization, as modified, and approved by the Bankruptcy Court on May 25, 1993.


Astrum Subsidiaries mean Culligan International Company, a Delaware
------ ------------ corporation, McGregor Corporation, a New York corporation, Samsonite Corporation, a Delaware corporation and Culligan Water Technologies, Inc., a Delaware corporation (in any such case, whether or not a subsidiary on the date this Agreement is executed).


Bankruptcy Court means the United States Bankruptcy
---------- -----


--


Court for the Southern District of New York.


Code means the Internal Revenue Code of 1986, as amended.
----


Controlled Group means, as to any entity, such entity and all related
---------- ----- entities that, at the relevant time for purposes of this Agreement, are under common control with such entity (within the meaning of ERISA Sections 4001(a)(14) and 4001(b)(1) and Code Sections 414(b) and (c) and the regulations promulgated thereunder and, solely for purposes of determining liability under Code Section 412, Code Sections 414(m) and 414(o)).


ERISA means the Employee Retirement Income Security Act of 1974, as
----- amended.


McCrory means McCrory Corporation, a Delaware corporation, a debtor
------- and debtor in possession in the McCrory Chapter 11 Case, and all other joint debtors and debtors in possession in such case. From and after the confirmation of a plan of reorganization in the McCrory Chapter 11 Case, the term "McCrory" shall also include all trades or businesses that result from the confirmation of such a plan.


McCrory Chapter 11 Case means Chapter 11 case numbers 92-B-41133(CB)
------- ------- -- ---- through 92-B-41160(CB) currently being jointly administered in the Bankruptcy Court.


McCrory Controlled Group means McCrory and all entities that are under
------- ---------- ----- common control with McCrory (within the meaning of ERISA Sections 4001(a)(14) and 4001(b)(1) and Code Sections 414(b) and (c) and the regulations promulgated thereunder), as such group may change from time to time, where applicable, in accordance with Section 7 hereof. As used in this Agreement, the term McCrory Controlled Group shall mean the group as it exists at the relevant time under this Agreement.


McCrory Pension Plan means the McCrory Stores Pension Plan, a defined
------- ------- ---- benefit pension plan subject to Title IV of ERISA, as adopted effective February 1, 1987, and as subsequently amended from time to time.


McCrory Plan Consummation Date means the effective date of the McCrory
------- ---- ------------ ---- Plan of Reorganization.


McCrory Plan of Reorganization means the Amended Joint Plan of
------- ---- -- -------------- Reorganization proposed by McCrory and filed with the Bankruptcy Court on February 19, 1993, as subsequently amended


--


from time to time.


McCrory Principal Subsidiaries means J.J. Newberry Co., a Delaware
------- --------- ------------ corporation, T. G. & Y Stores Co., a Delaware corporation, Mack Realty Company, a Pennsylvania corporation, Kress-New Providence, Inc., a Delaware corporation and G.C. Murphy Company, a Pennsylvania corporation.


PBGC means the Pension Benefit Guaranty Corporation, a wholly-owned
---- United States Government corporation established under Section 4002 of ERISA.


Schenley Final Settlement Agreement means the Schenley Pension Plan
-------- ----- ---------- --------- Final Settlement Agreement dated the date hereof by and among the PBGC, McCrory, the McCrory Principal Subsidiaries, Astrum and the Astrum Subsidiaries.


Term means the term of this Agreement as provided in Section 9 hereof.
----


Unfunded Benefit Liabilities means, as of any date, the amount of
-------- ------- ----------- unfunded benefit liabilities, as such term is defined in ERISA Section 4001(a)(18), of the pension plan to which such term relates.


2. Liability for McCrory Pension Plan Underfunding, Contributions, and
------------- ---
Premiums
--------


In the event Astrum or one of the Astrum Subsidiaries assumes the sponsorship of the McCrory Pension Plan, as of and after the effective date of such assumption, no member of the McCrory Controlled Group shall have any obligation or liability with respect to the McCrory Pension Plan, to the McCrory Pension Plan or to Astrum or any of the Astrum Subsidiaries (or to any member of their respective Controlled Groups) or under Title IV of ERISA or Section 412 of the Code or to the PBGC, other than with respect to (i) contributions required to have been made to the McCrory Pension Plan under Section 412 of the Internal Revenue Code and Section 302 of ERISA by the members of the McCrory Controlled Group pursuant to the terms and conditions of the Compromise and Settlement Agreement; (ii) fiduciary liability under ERISA; or (iii) premium liability, and associated penalties and interest, under ERISA Sections 4006 and 4007 with respect to the McCrory Pension Plan, where, in each case, such liability arose prior to the effective date of the assumption of the sponsorship of the McCrory Pension Plan by Astrum or one of the Astrum Subsidiaries. Until Astrum or any of the Astrum Subsidiaries has become the plan sponsor of the McCrory Pension


--


Plan, McCrory and the members of its Controlled Group shall be primarily responsible for satisfaction of all obligations arising under or with respect to the McCrory Pension Plan and, subject to the provisions of this Agreement, the PBGC shall retain all rights available to it under any applicable law which is effective during the Term; provided, however, that the PBGC may not, unless sponsorship of the McCrory Pension Plan has been transferred to Astrum or one of the Astrum Subsidiaries, assert any right it may have to terminate the McCrory Pension Plan unless and until: (i) the PBGC has complied with its obligations under Section 2A below, and (ii) 40 days have elapsed from the date that the PBGC's liens arose under Code Section 412(n) without Astrum, any of the Astrum Subsidiaries, or any member of their respective Controlled Groups having paid the contributions then due and owing to the McCrory Pension Plan, or made arrangements satisfactory to the PBGC for the collection of such contributions; provided, further, however, that the PBGC shall not file an application with a United States District Court seeking involuntary termination of the McCrory Pension Plan pursuant to ERISA Section 4042(a)(4) prior to the McCrory Plan Consummation Date if (i) all contributions required to be made to the McCrory Pension Plan have been timely made by members of the McCrory Controlled Group, and (ii) the composition of the McCrory Controlled Group has not changed between the effective date of this Agreement and the McCrory Plan Consummation Date, with the exception of those changes resulting from and described in the McCrory Plan of Reorganization.


The following provisions of this Section 2 set forth the rights and obligations of McCrory, Astrum and the Astrum Subsidiaries and certain obligations of the PBGC with respect to the McCrory Pension Plan for the period prior to the effective date of any assumption of sponsorship of such Plan by Astrum or any of the Astrum Subsidiaries:


A. Astrum and the Astrum Subsidiaries agree to be secondarily liable for 100% of the contributions required to be made to the McCrory Pension Plan under Code Section 412 and ERISA Section 302 during the Term. Astrum or one of the Astrum Subsidiaries will pay or loan to the plan sponsor pursuant to Section 5 hereof, or make arrangements satisfactory to the PBGC for the collection of, any such contributions, provided (i) an accumulated funding deficiency, as defined under Code Section 412(a), shall have occurred with respect to such Plan, and 30 days shall have elapsed without such deficiency having been corrected, (ii) the amount of such deficiency shall be greater than $1,000,000, (iii) the PBGC shall have made reasonable efforts, as determined within its discretion, to perfect its


--


available lien rights under Code Section 412(n), or any successor thereto, against all known members of the McCrory Controlled Group, and (iv) the PBGC has made a written demand upon Astrum for payment.


B. To the extent that McCrory has failed to make full payment of premiums, penalties and interest required to be made with respect to the McCrory Pension Plan under ERISA Sections 4006 and 4007 during the Term, Astrum or the Astrum Subsidiaries shall make such payments to the PBGC within 30 days of notice that such amounts are due and owing; provided, however, that the PBGC shall first have given Astrum and the Astrum Subsidiaries notice of any such failure and shall first have made reasonable efforts, as
-- End of Preview --
Home| About Us| FAQ| Subscription | Contact Us |

Privacy Policy   Terms of Service  54.80.43.90