Equity Sharing Agreement for Employees

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Equity Sharing Agreement for Employees Powered By Docstoc
					  HIGHLIGHTS TO THE
PROPOSED MODIFICATION
 AGREEMENT BETWEEN
      INTERSTATE BRANDS
         CORPORATION
            AND THE
 INTERNATIONAL BROTHERHOOD
         OF TEAMSTERS
     EXISTING AGREEMENTS
• Long-Term Extension Agreements and
  their provisions will remain in full force and
  effect for their respective durations, except
  as modified by the Modification
  Agreement (which will expire July 31,
  2014)
      MASTER AGREEMENT
• The proposed Modification Agreement will
  be ratified by a national mail ballot
  referendum of all affected members, within
  the next 60 days
• A Master Extension Agreement will be
  negotiated within 12 months, and will
  incorporate all Long-Term Agreements
  and their expirations
           WAGES-HOURLY
• Effective the first Sunday after exiting
  bankruptcy for the life of the Modification
  Agreement:
  – $10.00 will be deducted from the gross
    weekly pay of all hourly employees

  This deduction can be reduced if;
1) Upon any fiscal year the EBITDA
   (Earning Before Interest, Taxes,
   Depreciation and Amortization) exceeds
   $150 million the $10 deduction will be
   reduced to $8;
2) Upon any fiscal year the EBITDA
   exceeds, $200 million, the deduction will
   be reduced to $5, and
3) Upon the EBITDA exceeding $300
   million, the deduction will be eliminated

The Modification Agreement shall also
  include a 2.5% wage increase per year,
  rounded up to the next highest nickel
  after completion of the Long Term
  Agreement
             WAGES - COMMISSION

•   When the company exits bankruptcy for the life of the
    Modification Agreement, base pay for commission
    employees will be reduced by $110

•   This base pay reduction can be reduced if;
    1) Upon any fiscal year the EBITDA exceeds $150 million, the
       weekly base reduction of $110 will be reduced to $90
    2) Upon any fiscal year the EBITDA exceeds $200 million, the
       weekly base pay reduction will be reduced to $45
    3) Upon any fiscal year the EBITDA exceeds $300 million, the
       weekly base pay reduction shall be eliminated
• Under the Modification Agreement,
  commission employees shall receive a
  yearly 2% base pay
  increase…rounded up to the nearest
  $1.00. This base pay increase shall
  be based on the base pay before any
  reductions
         EQUITY SHARING
• A Teamsters Equity Sharing Plan will be
  established at 7% of the Company’s total
  equity. Each employee’s share will be
  based on concessionary Base Pay dollars
  (for RSR’s) and reduction from gross
  weekly pay (for hourly employees)
  contributed for life of IBC/IBT Modification
  Agreement.
            HEALTH & WELFARE
•   After exiting bankruptcy, Teamsters represented
    employees covered by the company’s Cigna Plan shall;
    1) Change from PPO or POS Plan to Open Access Plus
    2) Implementation of Case and Disease Management Program
    3) End coverage on last of month following termination
    4) Change eligibility period for initial coverage to the first of the
       month following two month’s employment. The existing hours
       requirement for eligibility shall remain unchanged
    5) Reduce Out Of Network Benefits to 60%
    6) Change the Prescription Drug Coverage as follows:
•
               Generic      Preferred    Non-Preferred
                            Brand        Brand
Retail – 30 days Flat $8    Flat $30            Flat $65


Mail Order
90 days          Flat $20   Flat $60     Flat $110



Mandatory generic if available. If generic is not
  available, the employee will be responsible for
  paying the branded co-pay. (Delete in current
  plans – “if there is no generic available, employee
  will pay as if generic.”)
• 6(b).    As an alternative to the
  change in Prescription Drug Coverage
  (6(a) above), the local union, on a
  contract by contract basis, may elect to
  have an additional $5.00 per week as
  (a pre-tax) employee contribution for
  the Health Benefits Coverage via
  payroll deduction; Written Notification
  of this 6(b) alternative must be
  provided to the employer prior to be
  determined.
• 7. Effective the first day following the expiration of
  the employees Long-Term Extension Agreements
  all employees covered by the Company Plan shall
  pay an additional $10.00 co-pay per week toward
  their Health Plan coverage. This will increase by
  $2.00 per week each year thereafter on the
  anniversary date of emergence from bankruptcy
  throughout the life of the Modification Agreement
• 8. If any Teamsters health and welfare plan can
  offer a plan of benefits equal to or better than the
  Company plan with guaranteed rates for the life of
  the Extension Agreement and such rates save the
  Company additional savings, the Company agrees,
  upon request, to meet and discuss with the IBT and
  consider transferring such employees to that plan.
•   Teamster-represented employees covered by Teamster
    (Taft-Hartley) health and welfare plans
    1) Effective the first Sunday after existing bankruptcy, employees
       will contribute an additional $30.00 per week via payroll
       deduction (on a pre-tax basis), which will increase by $2.00 per
       week each year thereafter on the anniversary date of
       emergence from bankruptcy for the life of the Modification
       Agreement. Employees already paying a contribution to a Taft-
       Hartley health and welfare plan shall have a maximum
       contribution of $45.00 per week in the first year; the weekly
       amount shall increase by $2.00 each year thereafter.
    2) IBC agrees to increase health and welfare contributions each
       year by an amount not to exceed 9½%, and any unused
       contribution increases can be moved forward
    3) Taft-Harley plans that are able to reduce their contribution rate
       during the applicable Long-Term Agreements may reduce the
       $30.00 contribution by reducing the like amount from their then
       existing contribution rate
               PENSION
• Teamster Multiemployer Pension Plans,
  after the expiration of any Long-Term
  Extension Agreement, will receive
  contribution increases from IBC not to
  exceed 10% per year, if required
– A portion of any required increase will
  be offset from other economics under
  the Modification Agreement by;
  1) Reducing or eliminating the annual base
     pay increases for drivers and a like amount
     for hourly employees
  2) Or reducing the increase in health and
     welfare contributions from 9.5% to 7.5%
  3) Or by reducing or eliminating any profit
     sharing
              PROFIT SHARING
• IBC will establish a Profit Sharing Program for all union-
  represented, hourly paid or non-exempt employees, of
  10% of its net income;
   – Payments will be made within 30 days following finalization of
     the Profit Sharing Pool calculations
   – Payments to IBT represented employees will be limited to
     employee in active or approved leave status as of the end of the
     applicable fiscal year
   – Each eligible employee’s individual profit sharing payment shall
     be that percentage calculated by dividing the employee’s gross
     W-2 wages by the gross W-2 wages of all eligible employees
          METHODS OF DELIVERY
•   IBC may adopt the following methods of distribution, after August 1,
    2010, but only after a successful test in an area not represented by
    Teamsters:
    1)   Large format system
    2)   Drop and go system
    3)   Direct store delivery (route sales)
    4)   Or a combination of any/all of the above

•   The company may designate a customer (or customer facilities) as
    serviced under one or more methods of distribution outlined above
    for bread product, cake product or both. The Company may change
    the designation at any time except that the drop and go system shall
    be limited as follows
    – Small customers less than $100 per week unless the parties mutually
      agree to a higher amount
    – Customers such as vending, food service, schools, restaurants and
      institutional
• If implemented, commission employees will receive a 42
  week wage guarantee based upon average earnings the
  year immediately before implementation
• Any employee affected by Large Formant or ‘drop and
  go’ delivery systems may elect to leave employment and
  receive a lump sum ”buy-out” from IBC of $10,000 or
  $600 per year of service up to 25 years, whichever is
  greater.
• Upon the company implementing in whole or part the
  method of delivery, other than the drop and go system,
  all employees within that affected area shall have their
  base pay reduction and the gross weekly pay reduction
  for hourly employees eliminated
• If ‘drop and go’ system is implemented, employees
  affected will have their weekly base pay reduction
  lowered by $10.00, and receive not less than a 6 month
  commission guarantee on any business transferred to
  the ‘drop and go’ system.
         TRANSPORT DRIVERS
• On transport operations, IBC has the right to convert
  transport hourly rates to trip rates, provided that the trip
  rates are equal to, or better than, the hourly rates for
  that year
• The IBC/IBT National Negotiating Committee agrees that
  Transervice is acceptable to the IBC/IBT National
  Negotiating Committee , and the IBT and the company
  agree that the Transervice Agreement, (if, when
  completed, it complies with the terms of the long term
  extension agreements, the side agreement dated
  September 5, 2006, and the IBT modification agreement)
  will serve as the model for future over-the-road transport
  agreements between the parties
               DOLLY DIRECT
• Commissions due on the Dolly Direct Program
  will terminate January 1, 2008
  – Operational changes – bread products
     • Wherever the number 8 appears, it will be replaced by the
       number 12
  – Operational changes – cake products
     • Wherever the number 15 appears, it will be replaced by the
       number 22. A new product developed by the company may
       not be added to Attachment D until such product has been
       sold by the company using Direct Sales Distribution method
       for 9 months or more. The company may add 7 additional
       cake products to Attachment D
     SOUTHERN CALIFORNIA
• Re-entry into southern California, northern
  Washington and Michigan bread markets
  will be considered by IBC
  – Upon re-entry into any such market, all work
    formerly performed by Teamsters will be
    assigned to Teamsters
  SENIORITY & JURISDICTION
• All work performed by Teamsters under the
  Modification Agreement and all Long-Term
  Extension Agreements will continue to be
  performed by Teamsters
• IBC will agree to a Neutrality and Protection of
  Jurisdiction Agreement
• Any disputes regarding the Modification
  Agreement will be subject to binding arbitration
QUESTIONS

				
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Description: Equity Sharing Agreement for Employees document sample