RETIREMENT AND CONSULTING AGREEMENT
The parties to this
Retirement and Consulting Agreement (the “Agreement”) are Ampco-Pittsburgh
Corporation (the “Corporation”) and Xxxxxx X. Xxxxxxx (the
“Executive”). This Agreement is entered into and will become
effective as of April 30, 2009 (the “Effective Date”).
The Executive has
announced his decision to retire from the Corporation as President and Chief
Operating Officer effective April 30, 2009 (the “Retirement
Date”). Upon the Executive’s retirement, he may continue to serve as
a member of the Board of Directors of the Corporation, subject to re-election by
the Corporation’s stockholders. Following the Retirement Date, the
Corporation wishes to retain the Executive for the purpose of providing, and the
Executive has agreed to provide, certain consulting services. This
Agreement is intended to set forth the terms applicable to the Executive’s
retirement from the Corporation and the consulting arrangement following the
Retirement Date.
NOW, THEREFORE, the
parties, intending to be legally bound, agree as follows:
1. Resignation and
Retirement. Effective on the Retirement Date, the Executive
will resign from all positions with the Corporation and any subsidiaries of the
Corporation then held by him, including President and Chief Operating Officer of
the Corporation, and the Executive’s employment with the Corporation will
terminate due to his retirement. Notwithstanding the foregoing, the
Executive may continue to serve as a member of the Board of the Corporation,
subject to re-election by the Corporation’s stockholders.
2. Consulting
Services.
(a) General. Beginning
on May 1, 2009 and ending on April 30, 2012 (such period, subject to the
extension and early termination provisions of Section 2(d) below, the
“Consulting Period”), the Executive agrees to cooperate with the Corporation in
the transition of management of the Corporation following Executive’s retirement
and to provide such consulting services to the Corporation (the “Consulting
Services”) as may be requested by the Board of Directors or the Chief Executive
Officer and be agreed to by the Executive, which agreement may not be
unreasonably withheld by Executive. The Executive agrees to provide
up to ninety (90) days of Consulting Services to the Corporation per annual
period of the Consulting Period (i.e., May 1 – April 30) under this
Agreement.
(b) Independent Contractor
Status and Performance of Consulting Services. Nothing
contained in this Agreement will be deemed to create an employment relationship
between the Corporation and the Executive during the Consulting
Period. In providing the Consulting Services, the Executive agrees
and acknowledges that he is an independent contractor and will not have
authority to bind the Corporation with respect to any matter. In
rendering Consulting Services under this Agreement, the Executive will be free
to arrange his own time, pursuits and work schedule and to determine the
specific manner in which such services will be performed, without being required
to observe any routine or requirement as to working hours.
(c) Non-exclusivity. The
Corporation agrees and acknowledges that Executive may offer consulting services
to other entities during the Consulting Period, subject to the confidentiality
and proprietary rights provisions of this Agreement.
(d) Extension or Early
Termination of Consulting Period. This Agreement and the
applicable Consulting Period may be extended beyond the term described in
Section 2(a) by mutual agreement of the parties. Notwithstanding any
provisions to the contrary in this Agreement, this Agreement may be terminated
prior to April 30, 2012 and the Consulting Period will be deemed to have expired
upon any of the following:
(i) The
mutual written agreement of the parties providing for such
termination;
(ii) Upon
written notice of such termination from either party to the other party,
provided such notice is provided to the other party at least sixty (60) days
prior to the effective date of the termination;
(iii) Immediately
upon notice by the Corporation to the Executive of the Executive’s breach of the
covenants set forth in Sections 9 and 10 of this Agreement; and
(iv) Upon
the death or permanent disability (as determined in good faith by the
Corporation) of the Executive.
3. Payments and
Benefits.
(a) In
Connection With Executive’s Retirement. Upon the Executive’s
retirement and termination from employment with the Corporation, the Executive
will be entitled to payment of all accrued, but unpaid, salary, bonus, vacation
or paid time-off and business expenses (to the extent properly accounted for) as
of the Retirement Date. In addition, the Executive will be entitled
to all accrued and vested retirement benefits under any qualified or
nonqualified plans or arrangements sponsored by the Corporation in accordance
with the terms and provisions of such plans or arrangements; provided, the
Executive will not accrue additional service or benefits under such plans during
the Consulting Period. Following the expiration of the Consulting
Period, the Executive will be covered by the Corporation’s retiree life
insurance coverage in accordance with the terms of that
arrangement.
(b) Bonus
for 2009. The Executive will be eligible to receive a pro rata
portion (4/12) of any bonus awarded under the Corporation’s annual bonus program
for the 2009 fiscal year, based on achievement of the applicable performance
goals for the year. The pro rata bonus, if any, will be paid when the
applicable bonus amounts are paid to eligible senior
executives. Except as described in this Section 3(b), the Executive
will not be entitled to any bonus or incentive compensation during the
Consulting Period.
(c) Automobile. The
Executive will have the right to purchase the leased Corporation car, which is
assigned to the Executive immediately prior to the Retirement Date, at a price
equal to the lesser of its then book value or market value. This
right will expire on September 30, 2009.
(d) In
Connection With Consulting Services. In consideration for the
Consulting Services to be provided by the Executive under this Agreement, the
Corporation agrees to pay or provide the Executive the following compensation or
benefits during the Consulting Period:
(i) The
amount of $18,750 per month (collectively, the “Payments”);
- 2 -
(ii) The
Corporation will arrange to provide the Executive at the Corporation’s expense
with benefits under the Corporation’s medical and dental insurance coverage
(including the medical expense reimbursement plan), life insurance (with a death
benefit equal to at least $281,250) and the same travel accident insurance
coverage applicable to Executive immediately prior to the Retirement
Date;
(iii) The
Corporation will provide or reimburse the Executive for the cost of home
computer, blackberry services and secretarial support services;
(iv) The
Corporation will reimburse the Executive for all out-of-pocket expenses
reasonably and necessarily incurred in the performance of the Consulting
Services in accordance with the travel and business expense reimbursement
policies of the Corporation in effect from time to time;
(v) In
addition to reimbursement of business expenses under clause (iv) above, the
Corporation will pay to or on behalf of the Executive annual Duquesne Club
membership dues and fees and monthly parking fees;
(vi) All
stock option awards granted to the Executive and outstanding on the Retirement
Date will, notwithstanding the terms of such awards, continue to vest during the
Consulting Period as if the Executive had continued to be employed with the
Corporation and, to the extent vested, will be exercisable for the remainder of
the applicable option term by the Executive to the same extent as, and in
accordance with the same terms that would apply, if the Executive was an active
employee (including the right of the Executive’s beneficiary or estate to
exercise such option for up to one year following the Executive’s death), but in
no event may such options be exercised beyond the applicable expiration date of
the option term; and
(vii) The
Executive will continue to be eligible to receive grants of stock options or
other equity awards during the Consulting Period, but such grants, if any, will
be in the sole discretion of the Compensation Committee of the
Board.
(e)
Right to COBRA
Continuation Coverage. The Corporation and the Executive agree
and acknowledge that, for purposes of the rights of the Executive and the
Executive’s spouse or any other eligible dependents to continuation of medical
and dental coverage under the Corporation’s group health plans in accordance
with the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), no
“qualifying event” (as defined under COBRA) shall be deemed to have occurred
until the end of the Consulting Period.
(f) Office
Space Following Consulting Period. During the Consulting
Period and for a period following the Consulting Period through April 30, 2016
(and regardless of whether the Consulting Period is terminated early under
Section 2(d)), the Corporation agrees to provide the Executive (or reimburse the
Executive for the cost of) reasonable office space at the Corporation’s
executive offices or otherwise located in the city of Pittsburgh,
Pennsylvania. Provision of the benefit or reimbursement of expenses
pursuant to this Section 3(f) will be available only to the extent that (1) such
benefit or expense is actually provided or incurred, as applicable, for any
particular calendar year and reasonably substantiated; (2) reimbursement of any
expense will be made no later than the end of the calendar year following the
year in which such expense is incurred by the Executive; (3) no provision of the
benefit or reimbursement of any expense incurred in one taxable year will affect
the amount available in another taxable year; and (4) the right to this benefit
or reimbursement is not subject to liquidation or exchange for another
benefit. Notwithstanding the foregoing, the provisions of this
Section 3(f) shall expire prior to April 30, 2016 in the event of the
Executive’s death or permanent disability.
- 3 -
(g) Compliance with Section
409A. Notwithstanding any provision of this Agreement to the
contrary, to the extent that a payment or benefit provided hereunder is subject
to Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”),
and not excepted or otherwise excluded from Section 409A’s requirements, and
payable on account of the Executive’s separation from service (as defined in
Section 409A and the related regulations), such payment shall be delayed for a
period of six months after the Executive’s separation date if the Executive is a
“specified employee” (as defined in Section 409A and the related regulations) of
the Corporation, as determined in accordance with the regulations issued under
Section 409A of the Code and the procedures established by the
Corporation.
4. Executive’s Status as a
Non-Employee Director. Following the Retirement Date, the
Executive will be deemed to be a non-employee director during his service on the
Corporation’s Board and any fees or other compensation received by the Executive
as a director will be in addition to the Payments and other benefits provided
under this Agreement.
5. Reasonable
Efforts. The Executive will use reasonable efforts to perform
the Consulting Services in a prompt, competent and diligent manner consistent
with the Corporation’s standards.
6. Proprietary
Rights. The Executive agrees that all information,
discoveries, inventions, improvements, strategies or overall business plan
concepts arising from or in connection with the Consulting Services under this
Agreement will be the sole property of the Corporation and the Executive will
cooperate with the Corporation’s reasonable requests for the transfer of any
such rights or interests from the Executive to the Corporation.
7. Taxes. The
Executive acknowledges that he will be solely responsible for and the
Corporation will have no liability with respect to any taxes (including
penalties and interest) imposed by any Federal, state or local government on the
Payments or any other benefits payable to or provided on behalf of the Executive
for the Consulting Services under Section 3(d) of this Agreement.
8. Insurance and
Indemnification. The Corporation agrees to ensure and to
indemnify and hold harmless the Executive from any and all claims and causes of
action arising out of the performance of the Consulting Services to the same
extent that it ensures and indemnifies its officers and directors.
9. Non-Disparagement.
|
|
(a)
|
At all times
hereafter, Executive will not disparage or criticize, orally or in
writing, the business, products, policies, decisions, directors, officers
or employees of the Corporation or any of its operating divisions,
subsidiaries or affiliates to any
person.
|
|
|
(b)
|
At all times
hereafter, the Corporation and its officers, directors, employees and
agents will not disparage or criticize, orally or in writing,
Executive.
|
- 4 -
10. Confidentiality. During
the course of providing the Consulting Services, the Executive may obtain
information that is considered to be confidential and proprietary information of
the Corporation. The Executive agrees to maintain as confidential all
confidential information received or obtained as a result of the services
provided. At no time shall such confidential information be disclosed
to any third party without the prior written consent of the
Corporation. Notwithstanding the foregoing, the Executive will have
no obligation under this Agreement to keep confidential any confidential
information to the extent that a disclosure of it is required by law or is
consented to by the Corporation.
11. Executive’s
Understanding. The Executive acknowledges by signing this
Agreement that the Executive has read and understands this document, that the
Executive has conferred with or had opportunity to confer with the Executive’s
attorney regarding the terms and meaning of this Agreement, that the Executive
has had sufficient time to consider the terms provided for in this Agreement,
that no representations or inducements have been made to the Executive except as
set forth in this Agreement, and that the Executive has entered into this
Agreement knowingly and voluntarily.
12. Miscellaneous.
(a) Entire
Agreement. This Agreement represents the entire and only
understanding between the parties on the subject matter hereof and supersedes
any other agreements or understandings between them on such subject
matter.
(b) Binding Effect, Successors
and Assigns. This Agreement shall be binding upon and inure to
the benefit of the heirs, executors, administrators, successors and assigns of
the respective parties. Without the express written consent of the
other party, neither the Corporation nor the Executive may assign any duties or
right or interest hereunder or right to receive any money hereunder and any such
assignment shall be void; provided, however, that without the Executive‘s
consent the Corporation may assign its rights and obligations hereunder in their
entirety to any successor to all or substantially all of its business, whether
effected by merger or otherwise.
(c) Severability and
Amendment. In the event any provision of this Agreement shall
be determined in any circumstances to be invalid or unenforceable, such
determination shall not affect or impair any other provision of this Agreement
or the enforcement of such provision in other appropriate circumstances. This
Agreement may be modified only by an instrument in writing executed by the
parties hereto.
- 5 -
(d) Interpretative Matters;
Counterparts. The headings of sections of this Agreement are
for convenience of reference only and shall not affect its meaning or
construction. The language used in this Agreement will be deemed to
be the language chosen by the parties to express their mutual intent, and no
rule of strict construction will be applied against any party. This
Agreement may be executed in multiple counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument. In making proof of this Agreement it shall not be
necessary to produce or account for more than one such counterpart.
(e) Governing Law and
Conflicts. This Agreement is to be governed and construed
according to the internal substantive laws of the Commonwealth of
Pennsylvania.
IN
WITNESS WHEREOF, and intending to be legally bound, the parties have executed
this Agreement as of the date first written above.
AMPCO-PITTSBURGH CORPORATION
_s/Xxxxxx X.
Paul_____________
By: Xxxxxx X. Xxxx,
Chairman
EXECUTIVE
___s/Xxxxxx X.
Siddons__________
By: Xxxxxx X. Xxxxxxx
- 6 -
