Change in Control Employment Agreement - HON Industries Inc.


 
HON INDUSTRIES Inc.                                          EXHIBIT (10)
Change In Control Employment Agreement
- --------------------------------------



THIS AMENDED AND RESTATED AGREEMENT is made between HON
INDUSTRIES Inc., an Iowa corporation (the 'Company'), and  __________________
(the 'Executive'), dated this _____ day of  _________________________, 19____.


 1.  Purpose. The Company wishes to attract and retain well-qualified executive
     and key personnel. The Company and the Executive wish to assure continuity
     of management in the event of any actual or threatened Change in Control
     (as defined in Section 3) of the Company. The Agreement is entered into to
     accomplish these purposes and in consideration for the mutual covenants
     herein contained.

 2.  Operation of Agreement. The 'effective date of this Agreement' shall be the
     first date during the 'Change in Control Period' (as defined below) on
     which a Change in Control occurs. This Agreement shall terminate if the
     Board of Directors of the Company (the 'Board') determines that the
     Executive is no longer a key executive who should be covered by this
     Agreement and so notifies the Executive; provided, however, that such a
     determination shall not be made, and if made shall have no effect, (i)
     within two years after the Change of Control or (ii) during any period of
     time when the Company has knowledge that any third person has taken steps
     reasonably calculated to effect a Change of Control until, in the opinion
     of the Board, the third person has abandoned or terminated his efforts to
     effect a Change in Control. Any decision by the Board that the third person
     has abandoned or terminated his efforts to effect a Change of Control shall
     be conclusive and binding on the Executive. The 'Change in Control Period'
     shall mean the period commencing on the date hereof and ending on the
     second anniversary of the date hereof; provided, however, that commencing
     on the date one year after the date hereof, and on each annual anniversary
     of such date (such date and each annual anniversary thereof shall be
     hereinafter referred to as the 'Renewal Date'), unless previously
     terminated, the Change in Control Period shall be automatically extended so
     as to terminate two years from such Renewal Date, unless at least 60 days
     prior to the Renewal Date the Company shall give notice to the Executive
     that the Change in Control Period shall not be so extended.

 3.  Change in Control. For the purposes of this Agreement, a 'Change in
     Control' shall mean:

     (a) The acquisition by any individual, entity or group (within the meaning
     of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
     amended (the 'Exchange Act')) (a 'Person') of beneficial ownership (within
     the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or
     more of either (i) the then outstanding shares of common stock of the
     Company (the 'Outstanding Company Common Stock') or (ii) the combined
     voting power of the then outstanding voting securities of the Company
     entitled to vote generally in the election of Directors (the 'Outstanding
     Company Voting Securities'); provided, however, that for purposes of this
     subsection (a), the following acquisitions shall not constitute a Change of
     Control: (i) any acquisition directly from the Company, (ii) any
     acquisition by the Company, (iii) any acquisition by any employee benefit
     plan (or related trust) sponsored or main-



                                     -40-



 
     tained by the Company or any corporation controlled by the Company or (iv)
     any acquisition by any corporation pursuant to a transaction which complies
     with clauses (i), (ii) and (iii) of subsection (c) of this Section 3; or

     (b) individuals who, as of the date hereof, constitute the Board (the
     'Incumbent Board') cease for any reason to constitute at least two-thirds
     of the Board; provided, however, that any individual becoming a Director
     subsequent to the date hereof whose election, or nomination for election by
     the Company's shareholders, was approved by a vote of at least three-
     quarters of the Directors then comprising the Incumbent Board shall be
     considered as though such individual were a member of the Incumbent Board,
     but excluding, for this purpose, any such individual whose initial
     assumption of office occurs as a result of an actual or threatened election
     contest with respect to the election or removal of Directors or other
     actual or threatened solicitation of proxies or consents by or on behalf of
     a Person other than the Board; or

     (c) consummation of a reorganization, merger or consolidation or sale or
     other disposition of all or substantially all of the assets of the Company
     (a 'Business Combination'), in each case, unless, following such Business
     Combination, (i) all or substantially all of the individuals and entities
     who were the beneficial owners, respectively, of the Outstanding Company
     Common Stock and Outstanding Company Voting Securities immediately prior to
     such Business Combination beneficially own, directly or indirectly, more
     than 50% of, respectively, the then outstanding shares of common stock and
     the combined voting power of the then outstanding voting securities
     entitled to vote generally in the election of Directors, as the case may
     be, of the corporation resulting from such Business Combination (including,
     without limitation, a corporation which as a result of such transaction
     owns the Company or all or substantially all of the Company's assets either
     directly or through one or more subsidiaries) in substantially the same
     proportions as their ownership, immediately prior to such Business
     Combination of the Outstanding Company Common Stock and Outstanding Company
     Voting Securities, as the case may be, (ii) no Person (excluding any
     corporation resulting from such Business Combination or any employee
     benefit plan (or related trust) of the Company or such corporation
     resulting from such Business Combination) beneficially owns, directly or
     indirectly, 20% or more of, respectively, the then outstanding shares of
     common stock of the corporation resulting from such Business Combination or
     the combined voting power of the then outstanding voting securities of such
     corporation except to the extent that such ownership existed prior to the
     Business Combination and (iii) at least a majority of the members of the
     Board of Directors of the corporation resulting from such Business
     Combination were members of the Incumbent Board at the time of the
     execution of the initial agreement, or of the action of the Board,
     providing for such Business Combination; or

     (d) approval by the shareholders of the Company of a complete liquidation
     or dissolution of the Company.

 4.  Employment.
     ---------- 

     (a) The Company hereby agrees to continue the Executive in its employ and
     the Executive hereby agrees to remain in the employ of the Company, for the
     period



                                     -41-



 
     commencing on the effective date of this Agreement and ending on the
     earlier to occur of (i) the second anniversary of such date or (ii) the
     Executive's normal retirement date under the Company's applicable
     retirement plans or under such other agreement as the Company may have made
     with the Executive (the period commencing on the effective date of this
     Agreement and, subject to Section 6(c), ending on the earlier to occur of
     dates specified in clauses (i) and (ii) is referred to herein as the
     ('Employment Period').

     (b) During the Employment Period the Executive's position (including
     titles), authority and responsibilities shall be at least commensurate with
     those held, exercised and assigned during the 90-day period immediately
     preceding the effective date of this Agreement. Such services shall be
     performed at the location where the Executive was employed immediately
     prior to the effective date of this Agreement.

     (c) The Executive agrees that during the Employment Period he shall devote
     such business time during normal business hours exclusively to the business
     and affairs of the Company and use his best efforts to perform faithfully
     and efficiently the responsibilities assigned to him hereunder, in each
     case, to the extent necessary to discharge the responsibilities assigned to
     him hereunder, except for (i) services on corporate, civic or charitable
     boards or committees not significantly interfering with the performance of
     such responsibilities and (ii) periods of vacation and sick leave to which
     he is entitled. It is expressly understood and agreed that the Executive's
     continuing to serve on any boards and committees with which he shall be
     connected, as a member or otherwise, at the effective date of this
     Agreement shall not be deemed to interfere with the performance of the
     Executive's services to the Company.

 5.  Compensation.
     ------------ 

     (a) Base Salary. During the Employment Period, the Executive shall receive
     a base salary ('Base Salary') at a monthly rate at least equal to the
     highest monthly salary paid to the Executive by the Company or any of its
     affiliated companies within one year prior to the effective date of this
     Agreement. The Base Salary shall be reviewed at least once each year and
     shall be increased at any time and from time to time by action of the Board
     of the Company or any committee thereof or any individual having authority
     to take such action in accordance with the Company's regular practices. Any
     increase in the Base Salary shall not serve to limit or reduce any other
     obligation of the Company hereunder, and after any such increase the Base
     Salary shall not be reduced. As used in this Agreement, the term
     'affiliated companies' means any company controlling, controlled by, or
     under common control with the Company.

     (b) Annual Bonus. In addition to the Base Salary the Executive shall be
     awarded for each fiscal year during the Employment Period an annual bonus
     ('Annual Bonus') (either pursuant to the Executive Bonus Plan or any other
     bonus or incentive plan or program of the Company or otherwise) in cash at
     least equal to the highest bonus paid or payable to the Executive in
     respect of any of the fiscal years during the three fiscal years
     immediately prior to the effective date of this Agreement. Each such Annual
     Bonus shall be payable on the last day of February of the year next
     following the year


                       
                                     -42-



 
     for which the Annual Bonus is awarded.

     (c) Incentive and Savings Plans. In addition to the Base Salary and Annual
     Bonus payable as hereinabove provided, during the Employment Period the
     Executive shall be entitled to participate in all applicable incentive and
     savings plans and programs, including, where applicable, the Executive
     Long-Term Incentive Compensation Plan and the Salary Deferral Plan, and 
     in all applicable retirement and pension plans, including, where
     applicable, the HON INDUSTRIES Inc. Profit-Sharing Retirement Plan, on a
     basis providing him with the opportunity to receive compensation (without
     duplication of the Annual Bonus) and benefits equal to those provided by
     the Company and its affiliated companies for the Executive under such plans
     and programs as in effect at any time during the 90-day period immediately
     preceding the effective date of this Agreement or, if more favorable to the
     Executive, as in effect at any time thereafter with respect to executives
     with comparable responsibilities.

     (d) Benefit Plans. The Executive or his spouse, as the case may be, shall
     be entitled to receive employee benefits (including, without limitation,
     all amounts which he or his spouse is or would have been entitled to
     receive as benefits under all medical, dental, disability, group life,
     accidental death and travel accident insurance plans and programs of the
     Company and its affiliated companies) as in effect at any time during the
     90-day period immediately preceding the effective date of the Agreement, or
     if more favorable to the Executive, as in effect at any time thereafter
     with respect to executives with comparable responsibilities.

     (e) Expenses. During the Employment Period the Executive shall be entitled
     to receive prompt reimbursement for all reasonable expenses incurred by the
     Executive in accordance with the policies and procedures of the Company as
     in effect during the 90-day period immediately preceding the effective date
     of this Agreement or, if more favorable to the Executive, as in effect at
     any time thereafter with respect to executives with comparable
     responsibilities.

     (f) Vacation and Fringe Benefits. The Executive shall be entitled to paid
     vacation and fringe benefits in accordance with the policies of the Company
     as in effect during the 90-day period immediately preceding the effective
     date of this Agreement or, if more favorable to the Executive, as in effect
     at any time thereafter with respect to executives with comparable
     responsibilities.

 6.  Termination.
     ----------- 

     (a) Death or Disability. This Agreement shall terminate automatically upon
     the Executive's death. The Company may terminate Executive's employment,
     after having established the Executive's Disability, by giving to the
     Executive written notice of its intention to terminate his employment, and
     his employment with the Company shall terminate effective on the 90th day
     after receipt of such notice (the 'Disability Effective Date') if within
     90 days after such receipt the Executive shall fail to return to full-time
     performance of his duties (and if the Executive's Disability has been
     established pursuant to the definition of 'Disability' set forth below).
     For purposes of this

                             

                                     -43-

 


     Agreement, 'Disability' means disability which after the expiration of more
     than 26 weeks after its commencement is determined to be total and
     permanent by a physician selected by the Company or its insurers and
     acceptable to the Executive or his legal representative (such agreement to
     acceptability not to be withheld unreasonably).

     (b) Cause. The Company may terminate the Executive's employment for Cause.
     For purposes of this Agreement, 'Cause' means (i) an act or acts of
     dishonesty on the Executive's part which are intended to result in his
     substantial personal enrichment at the expense of the Company or (ii)
     repeated violations by the Executive of his obligations under Section 4 of
     this Agreement which are demonstrably willful and deliberate on the
     Executive's part and which resulted in material injury to the Company.

     For purposes of this provision, no act or failure to act, on the part of
     the Executive, shall be considered to constitute 'Cause' unless it is done,
     or omitted to be done, by the Executive in bad faith or without reasonable
     belief that the Executive's action or omission was in the best interests of
     the Company. Any act, or failure to act, based upon authority given
     pursuant to a resolution duly adopted by the Board or upon the instructions
     of the Chief Executive Officer or a senior officer of the Company or based
     upon the advice of counsel for the Company shall be conclusively presumed
     to be done, or omitted to be done, by the Executive in good faith and in
     the best interests of the Company. The cessation of employment of the
     Executive shall not be deemed to be for Cause unless and until there shall
     have been delivered to the Executive a copy of a resolution duly adopted by
     the affirmative vote of not less than three-quarters of the entire
     membership of the Board at a meeting of the Board called and held for such
     purpose (after reasonable notice is provided to the Executive and the
     Executive is given an opportunity, together with counsel, to be heard
     before the Board), finding that, in the good faith opinion of the Board,
     the Executive is guilty of the conduct described in subparagraph (i) or
     (ii) above, and specifying the particulars thereof in detail.

     (c) Good Reason. The Executive may terminate his employment for Good
     Reason. For purposes of this Agreement, 'Good Reason' means:

         (i)   without the express written consent of the Executive, (A) the
         assignment to the Executive of any duties inconsistent in any
         substantial respect with the Executive's position, authority or
         responsibilities as contemplated by Section 4(b) of this Agreement, or
         (B) any other substantial change in such position (including titles),
         authority or responsibilities;

         (ii)  any failure by the Company to comply with any of the provisions
         of Section 5 of this Agreement, other than an insubstantial and
         inadvertent failure remedied by the Company promptly after receipt of
         notice thereof given by the Executive;

         (iii) the Company's requiring the Executive to be based at any office
         or location other than that at which the Executive is based at the
         effective date of

                          

                                     -44-

 


         this Agreement, except for travel reasonably required in the
         performance of the Executive's responsibilities;

         (iv)  a purported termination by the Company of the Executive's
         employment otherwise than as permitted by this Agreement, it being
         understood that any such purported termination shall not be effective
         for any purpose of this Agreement;

         (v)   any failure by the Company to obtain the assumption and agreement
         to perform this Agreement by a successor as contemplated by Section 16;
         or

         (vi)  any good faith determination by the Executive that the Change in
         Control has resulted in a change of circumstances rendering the
         Executive substantially unable to carry out authorities or
         responsibilities attached to his position held prior to the Change in
         Control.

     (d) Notice of Termination. Any termination by the Company for Cause or by
     the Executive for Good Reason shall be communicated by Notice of
     Termination to the other party hereto given in accordance with Section 12.
     For purposes of this Agreement, a 'Notice of Termination' means a written
     notice which (i) indicates the specific termination provision in this
     Agreement relied upon, (ii) sets forth in reasonable detail the facts and
     circumstances claimed to provide a basis for termination of the Executive's
     employment under the provision so indicated and (iii) if the termination
     date is other than the date of receipt of such notice, specifies the
     termination date of this Agreement (which date shall be not more than 15
     days after the giving of such notice).

     (e) Date of Termination. 'Date of Termination' means the date of receipt of
     the Notice of Termination or the date specified therein, as the case may
     be.

 7.  Obligation of the Company upon Termination.
     ------------------------------------------ 

     (a) Death. If the Executive's employment is terminated by reason of the
     Executive's death, this Agreement shall terminate without further
     obligations to the Executive's legal representatives under this Agreement
     other than those obligations accrued or vested hereunder at the date of his
     death.

     (b) Disability. If the Executive's employment is terminated by reason of
     the Executive's Disability, the Executive shall be entitled to receive
     disability and other benefits after the Disability Effective Date at least
     equal to those provided in accordance with Section 5(d).

     (c) Cause. If the Executive's employment shall be terminated for Cause, the
     Company shall pay the Executive his full Base Salary through the Date of
     Termination

                

                                     -45-

 


     at the rate in effect at the time Notice of Termination is given, and the
     Company shall have no further obligations to the Executive under this
     Agreement, except that such termination shall not modify or affect in any
     way any accrued right of the Executive to any other compensation payable
     pursuant to Section 5 or to any vested or accrued benefits payable in
     accordance with such Section.

     (d) Good Reason; Other Than for Cause or Disability.
         ----------------------------------------------- 

         (i)   Termination Payments. Subject to clause (ii) hereof, if the
         Company shall terminate the Executive's employment other than for Cause
         or Disability, or if the Executive shall terminate his employment for
         Good Reason, the Company shall pay to the Executive the following
         amounts and provide him with the following benefits:

               (a) If not theretofore paid, the Executive shall be paid (x) his
               Base Salary through the Date of Termination at the rate in effect
               (or, if greater, the rate required by Section 5(a)) at the time
               the Notice of Termination was given, and (y) a lump-sum cash
               payment equal to product of (i) a fraction, the numerator of
               which equals the number of days elapsed since the beginning of
               the fiscal year in which the Executive's Date of Termination
               occurs through the Date of Termination and the denominator of
               which is 365, and (ii) the average of the Annual Bonus paid to
               the Executive for the two years prior to the year in which the
               Date of Termination occurs.

               (b) A lump-sum cash payment equal to two times the sum of (x) the
               Executive's annual base salary (at the rate in effect immediately
               prior to the Date of Termination, or, if greater, the rate
               required by Section 5(a)) and (y) the average of the Annual
               Bonuses paid to the Executive for the two years prior to the year
               in which the Date of Termination occurs.

               (c) For two years after the Date of Termination, the Executive
               shall continue to receive benefits under the Company's employee
               benefit plans described in Section 5(d) and 5(f) hereof as if he
               remained employed with the Company, provided that upon the
               Executive's employment with another employer providing benefits
               described in Section 5(d), the Company's coverage shall be
               secondary, and provided further that the Company shall continue
               to make available to the Executive beyond the two-year period and
               on the same basis as to other active members all medical plans
               and programs for so long as a reasonably comparable program is
               not made available to the Executive or his spouse and minor
               children through another employer's group plan or a government
               sponsored plan, such as Medicare.



                                     -46-

 


               (d) The Executive shall be considered fully vested in any
               compensation or benefit amounts accrued, accruable or payable by
               the Company to the Executive under any Company sponsored     
               compensation or benefit plan, whether qualified or unqualified,
               including but not limited to Salary Deferral Plans, Executive
               Bonus Plans, Executive Long-Term Incentive Compensation Plans and
               such other plans as may have been in effect for the Executive
               immediately prior to the effective date of this Agreement and/or
               his Date of Termination.

               (e) If, despite the provisions of Sections 7(d)(i)(c) and
               7(d)(i)(d) above, benefits or service credits under any such
               employee benefit plan shall not be payable or provided under any
               such plan to the Executive, or his dependents, beneficiaries and
               estate, because he is no longer an employee of the Company, the
               Company itself shall, to the extent necessary, pay or provide for
               payment of such benefits and service credits for such benefits to
               the Executive, his dependents, beneficiaries and estate.

         (ii)  Limitation.  Anything in this Agreement to the contrary
         notwithstanding, in the event it shall be determined that any payment
         or distribution by the Company to or for the benefit of Executive
         (whether paid or payable or distributed or distributable pursuant to
         the terms of this Agreement or otherwise) (a 'Payment') would be
         nondeductible by the Company for Federal income tax purposes because of
         Section 280G of the Internal Revenue Code of 1986, as amended (the
         'Code'), then the aggregate present value of amounts payable or
         distributable to or for the benefit of Executive pursuant to this
         Agreement (such payments or distributions pursuant to this Agreement
         are hereinafter referred to as 'Agreement Payments') shall be reduced
         (but not below zero) to the Reduced Amount.

         The 'Reduced Amount' shall be an amount expressed in present value
         which maximizes the aggregate present value of Agreement Payments
         without causing any Payment to be nondeductible by the Company because
         of Section 280G of the Code. Present value shall be determined in
         accordance with Section 280G(d)(4) of the Code. The determination of
         the Reduced Amount and the components thereof required to be made
         hereunder shall be made by Ernst & Young, or any other accounting firm
         which, immediately prior to the effective date of this Agreement, is
         the Company's independent auditor ('Accounting Firm') which shall
         provide detailed supporting calculations both to the Company and
         Executive within ten business days of the termination of employment of
         Executive or such earlier time as is requested by the Company. Such
         determination by Accounting Firm shall be binding upon the Company and
         Executive. Executive shall determine which and how much of the
         Agreement Payments (or, at the election of Executive, other Payments)
         shall be eliminated or reduced consistent with the determination of
         Reduced Amount by Accounting Firm, provided that, if Executive does not
         make such determination within five business days of the receipt of the
         calculations made



                                     -47-



 
         by Accounting Firm, the Company shall elect which and how much of the
         Agreement Payments shall be eliminated or reduced consistent with the
         calculation of the Reduced Amount and shall notify Executive promptly
         of such election.

         As promptly as practicable thereafter, the Company shall pay to or
         distribute to or for the benefit of Executive such amounts as are then
         due to Executive under this Agreement and shall promptly pay to or
         distribute for the benefit of Executive in the future such amounts as
         become due to Executive under this Agreement.

         As a result of the uncertainty in the application of Section 280G of
         the Code at the time of the initial determination by Accounting Firm
         hereunder, it is possible that Agreement Payments will have been made
         by the Company which should not have been made ('Overpayment') or that
         additional Agreement Payments which will have not been made by the
         Company could have been made ('Underpayment)', in each case, consistent
         with the calculation of the Reduced Amount hereunder.

         In the event that Accounting Firm determines that an Overpayment has
         been made, any such Overpayment shall be treated for all purposes as a
         loan to Executive which Executive shall repay to the Company together
         with interest at the applicable Federal rate provided for in Section
         7872 (f)(2) of the Code; provided, however, that no amount shall be
         payable by Executive to the Company (or if paid by Executive to the
         Company shall be returned to Executive) if and to the extent such
         payment would not reduce the amount which is subject to taxation under
         Section 4999 of the Code. In the event that Accounting Firm determines
         that an Underpayment has occurred, any such Underpayment shall be
         promptly paid by the Company to or for the benefit of the Executive
         together with interest at the applicable Federal rate provided for in
         Section 7872(f)(2) of the Code.

 8.  Confidentiality and Noncompetition. The Executive shall hold in a fiduciary
     capacity for the benefit of the Company all secret or confidential
     information, knowledge or data relating to the Company or any of its
     affiliated companies, and their respective businesses, which shall have
     been obtained by the Executive during his employment by the Company or any
     of its affiliated companies and which shall not be public knowledge. After
     termination of the Executive's employment with the Company he shall not,
     without the prior written consent of the Company, communicate or divulge
     any such information, knowledge, or data to anyone other than the Company
     and those designated by it.

     The Executive agrees that, in the event of the Termination for Cause or a
     voluntary termination of his employment with the Company other than for
     Good Reason, he shall not for a period of one year following such
     termination enter into any relationship whatsoever, either directly or
     indirectly, alone or in partnership, or as an officer, Director, employee
     or stockholder (beneficially owning stock or options to acquire



                                     -48-

 


     stock totalling more than five percent of the outstanding shares) of any
     corporation (other than the Company), or otherwise acquire or agree to
     acquire a significant present or future equity or other proprietorship
     interest, whether as a stockholder, partner, proprietor or otherwise, with
     any enterprise, business or division thereof (other than the Company),
     which is engaged in the same business in those states within the United
     States in which the Company is at the time of such termination of
     employment conducting its business and which has annual sales of at least
     $10,000,000.

     In no event shall an asserted violation of the provisions of this Section 8
     constitute a basis for deferring or withholding any amounts otherwise
     payable to the Executive under this Agreement.

 9.  No Obligation to Mitigate Damages. In the event of the termination of the
     Executive's employment, the Executive shall not be under any obligation to
     mitigate damages by seeking other employment and no amounts shall be offset
     against payments due to the Executive hereunder unless specifically
     provided herein.

10.  Non-Exclusivity of Rights. Nothing in this Agreement shall prevent or limit
     the Executive's continuing or future participation in any benefit, bonus,
     incentive or other plan or program provided by the Company or any of its
     affiliated companies and for which the Executive may qualify, nor shall
     anything herein limit or otherwise affect such rights as the Executive may
     have under other agreements with the Company or any of its affiliated
     companies. Amounts which are vested benefits or which the Executive is
     otherwise entitled to receive under any plan or program of the Company or
     any of its affiliated companies at or subsequent to the Date of Termination
     shall be payable in accordance with such plan or program.

11.  Full Settlement. The Company's obligation to make the payments provided for
     in this Agreement and otherwise to perform its obligations hereunder shall
     not be affected by any circumstances, including without limitation any set-
     off, counterclaim, recoupment, defense or other right which the Company may
     have against the Executive or others. The Company agrees to pay, to the
     full extent permitted by law, all legal fees and expenses which the
     Executive may reasonably incur as a result of any contest (regardless of
     the outcome thereof) by the Company or others of the validity or
     enforceability of, or liability under, any provision of this Agreement or
     any guarantee of performance thereof or as a result of any contest by the
     Executive against the amount of any deduction pursuant to Section 7(d)(ii)
     hereof, plus in each case interest, compounded quarterly, on the total
     unpaid amount determined to be payable under this Agreement, such interest
     to be calculated on the basis of the prime commercial lending rate
     announced by The Northern Trust Company, headquartered in Chicago, Illinois
     in effect from time to time during the period of such nonpayment. In the
     event that the Executive shall in good faith give a Notice of Termination
     for Good Reason and it shall thereafter be determined that Good Reason did
     not exist, the employment of the Executive shall, unless the Company and
     the Executive shall otherwise mutually agree, be deemed to have terminated,
     at the date of giving such purported Notice of Termination, by mutual
     consent of the Company and the Executive and, except as



                                     -49-

 


     provided in the last preceding sentence and except that such termination
     shall not modify or affect in any way any accrued right of the Executive to
     any compensation payable pursuant to Section 5 or to any vested or accrued
     benefits payable in accordance with such Section, the Executive shall be
     entitled to receive only those payments and benefits which he would have
     been entitled to receive at such date otherwise than under this Agreement.

12.  Notices. Any notices, requests, demands and other communications provided
     for by this Agreement shall be sufficient if in writing and if sent by
     registered or certified mail to the Executive at the last address he has
     filed in writing with the Company or, in the case of the Company, at its
     principal executive offices. Notice and communications shall be effective
     when actually received by the addressee.

13.  Non-Alienation. The Executive shall not have any right to pledge,
     hypothecate, anticipate or in any way create a lien upon any amounts
     provided under this Agreement; and no benefits payable hereunder shall be
     assignable in anticipation of payment either by voluntary or involuntary
     acts, or by operation of law, except by will or the laws of descent and
     distribution.

14.  Governing Law. The provisions of this Agreement shall be construed in
     accordance with the laws of the State of Iowa, without reference to
     principles of conflicts of laws.

15.  Amendment. This Agreement may be amended or cancelled by mutual agreement
     of the parties in writing without the consent of any other person and, so
     long as the Executive lives, no person, other than parties hereto, shall
     have any rights under or interest in this Agreement or the subject matter
     hereof.

16.  Successor to the Company. This Agreement shall inure to the benefit of and
     be binding upon the Company and its successors. The Company shall require
     any successor to all or substantially all of the business and/or assets of
     the Company, whether direct or indirect, by purchase, merger,
     consolidation, acquisition of stock, or otherwise, by an agreement in form
     and substance satisfactory to the Executive, expressly to assume and agree
     to perform this Agreement in the same manner and to the same extent as the
     Company would be required to perform if no such succession had taken place.

17.  Miscellaneous.
     ------------- 

     (a) In the event that any provision or portion of this Agreement shall be
     determined to be invalid or unenforceable for any reason, the remaining
     provisions of this Agreement shall be unaffected thereby and shall remain
     in full force and effect.

     (b) The Company may withhold from any amounts payable under this Agreement
     such Federal, state or local taxes as shall be required to be withheld
     pursuant to any applicable law or regulation.



                                     -50-

 


     (c) This Agreement contains the entire understanding with the Executive
     with respect to the subject matter hereof and shall supersede any similar
     agreement previously entered into between HON INDUSTRIES and the Executive.

     (d) The Company hereby waives any and all conflicts of interest and
     attorney-client privilege that would prohibit counsel to the Company from
     representing the Executive in disputes relating to this Agreement.

IN WITNESS WHEREOF, the Executive has hereunto set his hand and, pursuant to the
authorization from its Board of Directors the Company has caused these presents
to be executed in its name on its behalf, and its corporate seal to be hereunto
affixed and attested by its Secretary, all as of the day and year first above
written.



                                    -----------------------------
                                    Executive


                                    HON INDUSTRIES Inc.


                                    By:
                                        -------------------------
(SEAL)
                                    Its:
                                        -------------------------

ATTEST:



- -------------------------
Secretary



                                     -51-