A Participant’s accounts may be invested (along with any earnings) as the Participant directs in one or more of
the investments made available by the Plan administrator, including the Company stock fund. Withdrawals from the 401(k) Savings Plan may only be made upon termination of employment, attainment of age 59 1/2 or in connection with certain provisions of the Plan that permit hardship withdrawals. The 401(k) Savings Plan also permits loans to Participants.
For fiscal 2012 and 2011, Company matching contributions for all executive officers of the Company as a
group were $16,263 and $12,792, respectively, and for all employees of the Company as a group were $218,117 and $197,159, respectively.
G. Employees’ Stock Purchase Plan The 2007 Employees’ Stock Purchase Plan (the “2007 Plan”), which was approved in 2007, provides that the
options may cover shares of Class A or Class B Stock as the Company shall determine. The principal difference between the Class A Stock and the Class B Stock is their respective voting rights. Class B Stock is otherwise identical to the Class A Stock except (i) that it is generally non-transferable except to lineal descendants, (ii) cannot receive more dividends per share than the Class A Stock and (iii) can be converted to Class A Stock at any time. Under the 2007 Plan, the option price to purchase shares of the Company’s Common Stock was the lower of 85% of the market price on the date of grant or 85% of the market price on the date of exercise (two years from the date of grant).
The 2007 Plan gives new employees an opportunity to participate in the success of the Company and allows
present employee stockholders to invest further if they so desire. The Company’s management feels that a further financial interest of this type on the part of those who work in the Company and its subsidiaries gives it an added edge that makes a difference in Company performance. At June 30, 2012, 994 employees were eligible to participate in the 2007 Plan. Based on the closing market price for the Company’s Common Stock on July 27, 2012 of $11.20 per share, the aggregate market value of the 500,000 shares of Common Stock issuable under the 2007 Plan would be approximately $5,600,000.
Stockholders are being asked to approve the Company’s 2012 Employees’ Stock Purchase Plan (the “2012
Plan”), which is substantially similar to the 2007 Plan, and no additional options will be granted under the 2007 Plan.
The Company also sells shares to employees under an Employees’ Stock Purchase Plan adopted in 1952 (the
“1952 Plan”). The Company, from time to time, purchases these shares in the open market to be held in treasury. The Company pays brokerage and other expenses incidental to purchases and sales under the 1952 Plan and employees may authorize regular payroll deductions for purchases of shares.
H. Potential Payments upon Termination or Change of Control The Company entered into Change in Control Agreements (“CIC Agreements”) with Douglas A. Starrett and
Stephen F. Walsh on January 16, 2009 and with Francis J. O’Brien on July 15, 2010. Under the CIC Agreements, Messrs. Starrett, O’Brien and Walsh are entitled to certain payments in connection with a “change in control” (as defined in the CIC Agreements) of the Company. Among other triggering events set forth in the definition, a change in control of the Company will occur if any person is or becomes the beneficial owner, directly or indirectly, of securities of the Company representing 30% or more of the combined voting power of the Company's then outstanding voting securities or more than 50% of the total fair market value of the Company. The material terms of the CIC Agreements are summarized below.
CIC Agreement with Douglas A. Starrett Under Mr. Starrett’s CIC Agreement, Mr. Starrett is entitled to certain payments and benefits if there is a
change in control of the Company. In the event of a change in control of the Company, Mr. Starrett is entitled to:
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