EXHIBIT 10.22
Executive's Name: Xxxxx X. Xxxx
AMENDMENT NO. 2 TO
KEY EXECUTIVE EMPLOYMENT AND SEVERANCE AGREEMENT
THIS AMENDMENT NO. 2 (this "Amendment"), dated as of August 18, 1998,
supplements and amends the Key Employment and Severance Agreement, dated as of
August 15, 1995, as previously amended (the "Agreement"), by and between
SUPERIOR SERVICES, INC., a Wisconsin corporation (the "Company"), and the named
executive set forth above (the "Executive"). All defined terms used herein and
not defined shall have the same meaning as in the Agreement.
W I T N E S S E T H
WHEREAS, pursuant to Section 19 of the Agreement, the Executive and the
Company desire to supplement and amend the Agreement as specifically set forth
in this Amendment.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements herein set forth, and for other valuable consideration,
the parties hereto covenant and agree as follows:
1. Section 1(d) of the Agreement is hereby amended and restated to read
in its entirety as follows:
"(d) Cause. 'Cause' for termination by the Company of the
Executive's employment after a Change in Control of the Company,
for purposes of this Agreement, shall mean the following and only
the following: the Executive's final and nonappealable conviction
of, and sentencing for, a felony offense for a crime involving an
act by the Executive of conduct on behalf of the Company that
results in the Executive being physically imprisoned in a federal
or state penitentiary; provided, that 'Cause' for termination
shall only be determined by a vote of two-thirds of the Board of
Directors of the Company after (i) reasonable written notice to
the Executive, setting forth the basis for 'Cause,' specifying the
particulars thereof in detail; and (ii) an opportunity for the
Executive, together with his counsel, to be heard before the
Board."
2. Section 1(h) of the Agreement is hereby amended and restated to read
in its entirety as follows:
"(h) Discretionary Termination. For purposes of this Agreement,
'Discretionary Termination' means the determination by the
Executive, or his estate or personal representative in the event
of the Executive's death or disability, at any time
1
during the twelve (12) month period commencing on the occurrence
of a Change in Control of the Company, as evidenced by the
delivery to the Company, by the Executive or by his estate or
personal representative in the case of the Executive's death or
disability, of a Notice of Termination during such period, to
terminate this Agreement and his employment hereunder for any
reason whatsoever in his sole discretion, with or without good
faith, even if the Company has previously terminated the Executive
for death, disability, Cause or otherwise during such twelve (12)
month period following a Change in Control of the Company."
3. The first paragraph of Section 1(o) of the Agreement is hereby amended
and restated to read in its entirety as follows:
"(o) Termination Date. For purposes of this Agreement, except as
otherwise provided in Section 10(b) and Section 17(a) hereof or as
set forth below, the term 'Termination Date' means (i) if the
Executive's employment is terminated by the Executive's death, the
date of death; (ii) if the Executive's employment is terminated by
reason of voluntary early retirement, as agreed in writing by the
Company and the Executive, the date of such early retirement as
set forth in such written agreement; (iii) if the Executive's
employment is terminated by reason of disability pursuant to
Section 12 hereof, the earlier of thirty (30) days after the
Notice of Termination is given or one day prior to the end of the
Employment Period; (iv) if the Executive's employment is
terminated by the Executive voluntarily (other than for Good
Reason), the date the Notice of Termination is given; (v) if the
Executive's employment is terminated by the Executive voluntarily
pursuant to a Discretionary Termination, the Termination Date for
the purposes of the payment of a Termination Payment and a
Gross-Up Payment, if any, under Section 9(b) hereof shall be the
date the Notice of Termination is given to the Company; and (vi)
if the Executive's employment is terminated by the Company (other
than by reason of disability pursuant to Section 12 hereof) or by
the Executive for Good Reason, the earlier of thirty (30) days
after the Notice of Termination is given or one day prior to the
end of the Employment Period. Notwithstanding the foregoing,"
[Remainder of existing Section 1(o) to remain as written in the
Agreement.]
4. Section 5(c) of the Agreement is hereby amended and restated to read
in its entirety as follows:
"(c) Regardless of whether or not an Employment Period exists or
is ongoing, from the date of a Change in Control of the Company
(regardless of whether the Executive has ceased to be employed by
the Company for any reason) until he reaches age 85, the Executive
and the Executive's wife, and each of their children until they
reach the age of 21, shall each be entitled to receive, without
cost, premium, co-pay or deductible charges, full health and
medical, dental and vision care as provided by the Company to its
senior executive employees; provided,
2
that the Executive and his wife shall not be limited to their
choice(s) of doctor or the location(s) at which such care is
provided. In the event that the Executive dies prior to reaching
age 85, his wife shall continue to receive such health care
benefits on the same terms and conditions, until the date when the
Executive would have otherwise reached age 85 but for his death,
and each of their children shall continue to receive such health
care benefits on the same terms and conditions until they reach
age 21. From the date of a Change in Control of the Company
(regardless of whether the Executive has ceased to be employed by
the Company for any reason) until he reaches age 65, the Executive
will also be entitled to the benefit of a long-term and short-term
disability insurance policy of $3,000 per month, and in the event
that the Executive dies prior to reaching age 65, his wife shall
receive the benefits or continued coverage of such policies (as
the case may be). From the date of a Change in Control of the
Company (regardless of whether the Executive has ceased to be
employed by the Company for any reason), the Company will not,
without the Executive's consent, make any changes in the foregoing
benefits that would adversely affect in any material respect the
rights or benefits of the Executive or his wife or children
thereunder. During the Employment Period, the Executive shall also
be entitled to receive any other perquisites generally made
available, from time to time or at any time, to the Company's key
management personnel. Any payments under this Section 5(c) shall
be in addition to any other payments or benefits to be received by
the Executive under this Agreement or otherwise, including under
Section 4(C)(ii) of that certain Employment Agreement, dated as of
January 1, 1996, by and between the Company and the Executive (the
"Employment Agreement")."
5. A new Section 5(f) is hereby added to the Agreement, to read in its
entirety as follows:
"Regardless of whether or not an Employment Period exists or is
ongoing, immediately upon a Change in Control of the Company, all
awards granted to the Executive and then outstanding under the
Company's stock option and incentive compensation plans
('Executive Awards') that are not then exercisable by their terms
automatically will become immediately exercisable and fully vested
for the remainder of their stated terms. In addition, for a period
of thirty (30) days following such Change in Control of the
Company, the Executive shall have the right to terminate the
Executive Awards and to receive a lump-sum payment, in cash, equal
to the product of (a) the excess of (x) the per-unit fair market
value of the securities underlying the Executive Awards, over (y)
the per-unit exercise price of such Executive Awards, and (b) the
number of units of such securities covered by the Executive
Awards. For purposes of the preceding sentence, the 'fair market
value' of securities shall be based on the highest of (i) the
per-unit closing sale price of the securities underlying the
Executive Awards, as reported on a national securities exchange or
by the Nasdaq Stock Market, on the execution date of the agreement
pursuant to which the Change in Control of the
3
Company is effected, (ii) the per-unit closing sale price of the
securities underlying the Executive Awards, as reported on a
national securities exchange or by the Nasdaq Stock Market, on the
effective date of the transaction constituting a Change in Control
of the Company, and (iii) the highest per-unit price for such
securities actually paid in connection with such Change in Control
of the Company. Notwithstanding the foregoing, if the exercise of
any right granted pursuant to this Section 5(f) would make a
transaction constituting a Change in Control of the Company
ineligible for pooling of interests accounting under XXX Xx. 00
which, but for this Section 5(f), would otherwise be eligible for
such accounting treatment, the Board of Directors of the Company
shall have the ability to substitute for the cash payable pursuant
to this Section 5(f) securities of the Company (or of the other
entity surviving the transaction constituting the Change in
Control of the Company, or its parent corporation, if applicable)
having a fair market value equal to the cash that would otherwise
be payable hereunder. For purposes of the preceding sentence, the
'fair market value' of securities shall be based on the lower of
(i) the average closing bid price of such securities for the ten
(10) trading days prior to the execution date of the agreement
pursuant to which the Change in Control of the Company is
effected, and (ii) the average of the closing bid price of such
securities for the ten (10) trading days prior to the effective
date of the transaction constituting a Change in Control of the
Company, in each case as such closing bid prices are reported on a
national securities exchange or by the Nasdaq Stock Market."
6. The second and third paragraphs of Section 9(b) of the Agreement are
hereby deleted in their entirety and a new paragraph inserted in their place, to
read in its entirety as follows:
"In the event that a portion of the Termination Payment, Accrued
Benefits or any other payment or benefit under this Agreement, or
payments to or for the benefit of the Executive under any other
agreement or plan of the Company ('Total Benefits'), be deemed to
be an 'excess parachute payment,' as defined in Section 280G of
the Code, then the Company shall pay the Executive, no later than
the tenth day following the Executive's request, such additional
cash amount as is necessary to place the Executive in the same
after-tax financial position that he would have been in if he had
not incurred any liability for Excise Tax ('Excise Tax Liability')
under Section 4999 of the Code (the 'Gross-Up Payment'). For
purposes of determining whether any of the Total Benefits will be
subject to Excise Tax Liability and the amount of such Excise Tax
Liability, (i) Total Benefits shall be treated as 'parachute
payments' (within the meaning of Section 280G(b)(2) of the Code)
unless, in the reasonable opinion of the Company's tax counsel (as
confirmed by the Executive's tax counsel), such Total Benefits (in
whole or in part) do not constitute parachute payments, including
by reason of Section 280G(b)(4)(A) of the Code, and all 'excess
parachute payments' (within the meaning of Section 280G(b)(1) of
the Code) shall be treated as subject to
4
Excise Tax Liability, unless, in the reasonable opinion of the
Company's tax counsel (as confirmed by the Executive's tax
counsel), such excess parachute payments represent reasonable
compensation for services actually rendered within the meaning of
Section 280G(b)(4)(B) of the Code, or are not otherwise subject to
Excise Tax Liability, and (ii) the value of any noncash benefits
or any deferred payment or benefit shall be determined by the
Company's independent auditors in accordance with the principles
of Sections 280G(d)(3) and (4) of the Code. For purposes of
determining the amount of the Gross-Up Payment, the Executive
shall be deemed to pay federal income taxes at the highest
marginal rate of federal income taxation in the calendar year in
which the Gross-Up Payment is to be made and state and local
income taxes at the highest marginal rate of taxation in the state
and locality of the residence of the Executive, net of the maximum
reduction in federal income taxes that could be obtained from
deduction of such state and local taxes."
7. A new Section 26 is hereby added to the Agreement, to read in its
entirety as follows:
"26. Effect on Employment Agreement. No provision of this
Agreement shall limit the Company's obligation to make payments
and provide benefits otherwise receivable by the Executive under
the Employment Agreement, including under Section 4(C)(ii)
thereof, or any other agreement, regardless of whether or not the
Executive exercises his right to a Discretionary Termination
hereunder."
8. Except as specifically set forth above, all other terms and conditions
of the Agreement shall continue in full force and effect, unaffected by this
Amendment. This Amendment shall be effective for all purposes immediately as of
the date first written above.
IN WITNESS WHEREOF, the Executive and the Company have set their hands
hereto as of the date above.
SUPERIOR SERVICES, INC.
_________________________ By:_________________________
Executive G. W. "Xxxx" Xxxxxxxx
President and Chief Executive Officer
5
