Stock_equivalent_agreement

							STOCK EQUIVALENT AGREEMENT

THIS AGREEMENT is entered into this ____ day of __________, 19__, by and between _________________________, an Illinois corporation (the "Company"), and ________________ ("Employee"). RECITALS Employee has rendered valuable services to the Company and thereby has contributed to its success; and The Company now considers it desirable to provide an additional incentive to Employee and to reward him for continuing to render such valuable services to it and for contributing to the Company's future success, by awarding to the Employee deferred compensation based upon the performance of the Company during Employee's employment. The parties therefore agree as follows: 1. Employment. Employee will continue in the employ of the Company for periods of time as shall be determined from time to time by the Board of Directors of the Company and serve in his current capacity or in such other capacity as may be assigned to him from time to time by the Board of Directors. During the term of his employment, Employee shall devote his time, attention and best efforts to the affairs of the Company and will receive such compensation as may be determined by the Board of Directors. 2. Deferred Compensation. Subject to the terms and conditions, and payable in the manner set forth in this Agreement, the Company shall pay to Employee, in addition to Employee's other compensation, an amount (the "Deferred Compensation") equal to the product of (a) the Earnings Per Share (as defined) of the Company for each fiscal year of the Company occurring during the term of this Agreement times (b) a multiplier of ___________. In the event that the term of this Agreement shall include only a portion of a fiscal year of the Company, Deferred Compensation for such portion of the fiscal year shall be based upon the Earnings Per Share of the Company for the full months of such fiscal year. 3. Earnings Per Share. For purposes of this Agreement, the term "Earnings Per Share" shall be deemed to mean the Company's per-share earnings from operations (before capital transactions, bonuses paid to shareholders of the Company and allocations to the Company's LIFO reserve) for each share of the Company's Common Stock, $______ par value, outstanding from time to time during the term of this Agreement, as reflected on the Company's financial statements for each fiscal year of the Company occurring during the term hereof. In the event of a merger or consolidation of the Company in which the Company is not the surviving entity, the Board of Directors of the Company shall make any appropriate adjustments in the calculation of Earnings Per Share. All calculations of Earnings Per Share as reflected on the Company's financial statements shall be final and conclusive and shall be binding on all parties hereto.

4. Payment. Deferred Compensation (as calculated above) shall be payable to the Employee with respect to each fiscal year of the Company for which Deferred Compensation is to be paid hereunder upon the first to occur of, and only upon the occurrence of, any of the following events (the "Triggering Event"): (a) the third anniversary of the last day of such fiscal year, provided that the Employee is still an employee of the Company as of such date; (b) (c) (d) the death of the Employee; the Disability (as defined) of the Employee; the Retirement (as defined) of Employee; or

(e) the termination by the Company of the Employee's employment with the Company, other than for "Cause" (as defined). The Employee's right to receive any unpaid Deferred Compensation hereunder shall be forfeited, and the Company shall not be obligated to make any payments, with respect to any fiscal year if the Employee's employment with the Company is terminated by the Company or the Employee prior to the third anniversary of the end of such fiscal year, unless such termination is by the Company other than for "Cause" or is by reason of death, Disability or Retirement. Deferred Compensation shall be paid by the Company to the Employee or his Beneficiary (as defined) in cash in a lump sum (without interest) within thirty (30) days of the applicable Triggering Event. 5. Disability. For purposes of this Agreement, the term "Disability" shall mean the Employee having been absent from his duties with the Company on a full-time basis for nine (9) consecutive months as a result of the Employee's incapacity due to physical or mental illness. 6. Retirement. The term "Retirement" as used in this Agreement shall mean termination by the Company or the Employee of the Employee's employment with the Company based on the Employee's having reached age sixty-five (65) or such other age as shall have been specified as the Employee's retirement age under the Company's retirement policy. 7. Cause. For purposes of this Agreement only, the Company shall have "Cause" to terminate the Employee's employment upon (i) the continued failure of the Employee to substantially perform his duties with the Company (other than any such failure resulting from Disability), or (ii) the engaging by the Employee in willful, reckless or grossly negligent misconduct which is injurious to the Company, monetarily or otherwise.

8.

Beneficiary. For purposes of this Agreement, the term "Beneficiary" shall mean:

(a) the person or persons (who may be designated successively or contingently, or who may be a trustee or legal representative of an estate) as Employee may from time to time

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designate by writing filed with the Company during his lifetime, or (b) unless otherwise provided by the Beneficiary designation filed by Employee, if any or all of the persons so designated die before Employee or before receiving all of the payments contemplated by this Agreement, or if Employee fails to designate a Beneficiary as provided in subparagraph (a) above, then the Beneficiary as to any payments or remaining payments shall be the estate of the last to die of Employee and any person designated by him in accordance with subparagraph (a) above. Upon termination of all duties of a trustee or legal representative of an estate, other than the duty to dispose of the right to receive amounts remaining unpaid under this Agreement, then the Beneficiary or Beneficiaries of any remaining payments shall be the person or persons certified in writing to the Company by the trustee or legal representative of an estate to be the successive Beneficiary or Beneficiaries. 9. Non-Competition. Notwithstanding any other provision of this Agreement, the Company shall not be obligated to make any payments under this Agreement if Employee engages, or has engaged in any activity, or performs, or has performed, any services in or for any other person, business or organization in connection with any matter, which is or might reasonably be expected to compete with the Company or affect the Company adversely or otherwise be incompatible with his obligations under this Agreement, as determined by the Company's Board of Directors. 10. Non-Assignability. Employee shall have no right to receive advances on any payments to be made hereunder or to alienate, dispose of or encumber any of the payments arising out of this Agreement. The Company shall not recognize any assignment or alienation of this Agreement, either in whole or in part, nor shall the interest of Employee under this Agreement be subject to attachment, garnishment or execution following judgment or other legal process. 11. Term. This Agreement shall terminate, except to the extent that any obligation of the Company remains unpaid as of such time, upon the earliest of (i) three (3) years from this date; or (ii) the termination of the Employee's employment with the Company. 12. Successor to the Company. The Company will require any successor or assign (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company, expressly, absolutely and unconditionally to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession or assignment had taken place. 13. Funding. Nothing in this Agreement shall be interpreted or construed to require the Company in any manner to fund its obligation to Employee, and all amounts payable pursuant to the terms of this Agreement shall be paid from the general assets of the Company. 14. Notice. For purposes of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States registered mail, return receipt registered, postage prepaid, as follows: If to the Company:

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__________________________ __________________________ __________________________ If to the Employee: __________________________ __________________________ __________________________ or such other address as either party may have furnished to the other in writing in accordance with this Agreement, except that notices of change of address shall be effective only upon receipt. 15. Miscellaneous. No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing signed by the Employee and the Company. No waiver by either party at any time of any breach by the other party of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter have been made by either party which are not set forth expressly in this Agreement. This Agreement shall be governed by and construed in accordance with the laws of the State of Illinois. 16. Validity. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect. 17. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

The Employee:

__________________________________

_________________________

By:_______________________________ Title:________________________

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