Before MARIS, GOODRICH and KALODNER, Circuit Judges.
The plaintiff, Warren M. Wilson, a resident of Ohio, brought a civil action in the United States District Court for the Western District of Pennsylvania against his former employer, Homestead Valve Manufacturing Company, a Pennsylvania corporation, to recover compensation which he alleged was due him for services rendered as a district sales manager. The defendant manufactures valves and jennys, including an apparatus which it calls a Hypressure Jenny. The plaintiff was employed by the defendant from the time of his graduation from Carnegie Institute of Technology as a mechanical engineer in 1935 until March 18, 1942. He worked at first in the engineering department, during which time for a short period, he performed the duties of a district sales manager in the defendant's eastern territory. In the latter part of 1938 the plaintiff become district sales manager for the eastern territory for the sale of Hypresure Jennys and later for the sale of valves to steel mills. P. L. Rhodes, formerly the district sales manager for the eastern territory for all of the defendant's products, thereafter retained jurisdiction only over the sale of valves to accounts other than steel mills. Rhodes left the defendant's employ during the latter part of 1939.
On February 1, 1940, the plaintiff took over the duties of district sales manager for all of the defendant's products for the eastern territory under a written agreement which set forth his duties and his compensation consisting of a base salary of $250.00 each month and a bonus which was to be prorated over the last eleven months of 1940. On January 30, 1941 the defendant mailed to the plaintiff a credit memorandum showing $1,346.89 bonus due him on 1940 sales and attached thereto a proposed 1941 contract, dated January 30, 1941. This proposed agreement set forth the plaintiff's duties in the same terms as they were stated in the 1940 agreement and provided for the same base monthly salary and bonus, to be prorated over the twelve months of 1941. The contract thus offered was accepted by the plaintiff and it is upon it that the present action was based. The contract provided as follows:
Re: Salary & Bonus Agreement
Superceding all previous agreements, you will on February 1st:
1. Take over the direction of sales of Homestead Valves and Hypressure Jennys in the complete Eastern Territory comprising New England States (New York west to Syracuse), New Jersey, Pennsylvania west to and including Harrisburg, Delaware, Maryland, District of Columbia, and Virginia.
2. Place and direct Manufacturers Agents in the New England (Boston) area, New York area, Philadelphia area, and later in the Albany, New York area. These agents are exclusive automotive Jenny agents.
3. Follow up industrial Jenny leads, secure data for Surveys from these leads and close them.
4. Demonstrate and instruct Agents to demonstrate Hypressure Jenny to prospective customers.
5. Develop multiple Jenny sales.
6. Visit Valve Agents and customers, dividing your time approximately equally between Valve and Jenny sales work.
Your territory shall be covered once every six weeks.
Your itinerary shall be given us in advance and detailed reports on Agents and customers visited shall be sent us promptly.
Your financial arrangement with Homestead Valve Manufacturing Company is:
1. A base salary rate of $250 a month starting Jan. 1st, 1941.
2. A bonus consisting of the difference between salary and selling expense, and the aggregate yearly earnings from Valve and Jenny sales in your territory on the following basis:*fn1
4% on the first $60,000 net ...