EXHIBIT 10.21
FORM 10-K
YEAR ENDED DECEMBER 31, 2001
TERMINATION BENEFITS AGREEMENT
This Termination Benefits Agreement ("Agreement") is entered into as
of the 5th day of March, 2002, by and between Bucyrus International, Inc. a
Delaware corporation ("Company"), and Xxxxxx X. Xxxxxxxx ("Employee").
WITNESSETH:
WHEREAS, Employee is a key member of the Company's management team:
WHEREAS, the Company considers that providing Employee with certain
termination benefits will operate as an incentive for Employee to continue
furnishing services to the Company including during a period that the
Company is negotiating a change in control or ownership of the Company or
any of its subsidiaries:
WHEREAS, this Agreement is intended to provide benefits only in the
event of a change in control or ownership of the Company or any of its
subsidiaries prior to December 31, 2005 (the "Expiration Date");
NOW THEREFORE, to induce Employee to continue furnishing services to
the Company through the Expiration Date, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
the Company and Employee agrees as follows:
1. Definitions.
(a) "Change in Control" shall mean the sale by the Company of
all or substantially all of its, or any of its
subsidiaries, assets and business to a person or entity
other than a Related Person or the sale of fifty-one
percent (51%) or more of the voting securities and
capital stock of the Company or any of its subsidiaries
to a person or entity other than a Related Person.
"Related Person" shall mean any person or entity directly
or indirectly owned and controlled by American Industrial
Partners ("AIP").
(b) "Termination Date" shall mean the date of termination of
Employee's relationship with the Company.
(c) "Termination Payments" shall mean any payment or
distribution of compensation or benefits made pursuant to
Section 3 of this Agreement.
(d) "Termination with Cause" shall mean termination of
Employee by the Company for any of the following reasons:
(i) the failure of Employee to render services to the
Company in substantial accordance with the terms
under which he was retained, which failure amounts
to gross neglect of his duties to the Company;
(ii) any violation of Section 6 of this Agreement or any
other agreement which Employee may have with the
Company;
(iii) taking any role in any buy-out of the Company or
any of its subsidiaries without the approval of the
Company's majority shareholder; or
(iv) Employee's commission of any act of fraud, theft or
embezzlement against the Company.
(e) "Voluntary Termination" shall mean the voluntary
termination by Employee of his relationship with the
Company other than a voluntary termination following
either:
(i) any reduction in compensation consisting of base
salary or incentive bonus;
(ii) a substantial diminution of his responsibilities;
or
(iii) a relocation by the Company of Employee outside a
twenty (20) mile radius of the place where Employee
currently performs his services for the Company.
2. Termination of Employee. In the event of the termination of
Employee's services arrangement with the Company within two (2)
years immediately following the date on which there was a
Change in Control or ownership of the Company or any of its
subsidiaries, the Company shall provide Employee with the
Termination Payments outlined in Section 3, unless the
termination is for any of the following reasons:
(a) Termination With Cause;
(b) Voluntary Termination;
(c) The death of Employee. Nothing in this section shall
affect any entitlement of Employee's heirs to the
benefits of any life insurance plan; or
(d) Termination as a result of Employee's incapacity (i.e.,
if in the reasonable opinion of the Company, Employee is
prevented from properly performing his duties by reason
of any physical or mental incapacity for a period of more
than one hundred twenty (120) days, in the aggregate, in
any twelve (12) months period). Nothing in this section
shall affect Employee's rights under any disability plan
in which he is a participant.
3. Termination Payments. In the event that Employee is entitled
to Termination Payments pursuant to the terms of Section 2:
(a) Compensation. The Company shall pay Employee an amount
equal to one (1) year base salary plus incentive bonus at
target as of the Termination Date, without giving effect
to any reduction in base salary or incentive bonus prior
to the Termination Date; payable within thirty (30) days
of the Termination Date following the Change in Control.
(b) Employee's Benefits:
(i) Vacation. Any accrued vacation pay due but not yet
taken at the Termination Date shall be paid to
Employee within (30) days following the Termination
Date.
(ii) Health Benefits. If Employee participated in any
health benefit Plan in effect immediately prior to
the Termination Date, and if Employee elects to
continue participating in such plan pursuant to the
terms of said plan and the Comprehensive Omnibus
Budget Reconciliation Act ("COBRA"), the Company
shall pay for the costs of Employee's participation
in such plan from the Termination Date until the
earlier of: (a) the date which is twenty-four (24)
months following the Termination Date; or (b) the
date of Employee's eligibility in any health
benefit plan offered by Employee's new employer, if
any. Employee shall notify the Company in writing
within thirty (30) days of any new employement.
(iii) Retirement and Profit-Sharing Plans.
Notwithstanding anything in this Agreement to the
contrary, Employee's rights in any retirement,
pension or profit-sharing plans offered by the
Company shall be governed by the rules of such
plans as well as by applicable law; provided,
however, that on the Termination Date, Employee
shall become fully vested in all pension and 401(k)
account balances.
(iv) Outplacement Assistance. The Company will provide
Employee up to one year of outplacement services
with a nationally recognized executive placement
company not to exceed $15,000.
4. At Will Employment. The Company and the Employee have, and
will continue to have, an at-will employment relationship.
That is, either party can terminate the employment relationship
for any reason at any time. Nothing contained in this
Agreement shall be interpreted to amend or alter this at-will
employment relationship.
5. Continuing Obligations. In order to induce the Company to
enter into this Agreement, Employee hereby agrees that all
documents, records, techniques, business secrets and other
information which have come into his possession from time to
time during this performance of services for the Company or
which may come into this possession during his performance
hereunder, shall be deemed to be confidential and proprietary
to the Company, and Employee further agrees to retain in
confidence and confidential information known to him concerning
the Company and its subsidiaries and their respective
businesses so long as such information is not publicly
disclosed. Employee further agrees to cooperate fully as
requested from time to time by the controlling shareholder of
the Company, the Company's Board of Directors, or Company
Management in connection with any transaction involving the
possible sale of the Company or any of its subsidiaries.
Employee further agrees not to speak about a possible sale of
the Company or any of its subsidiaries with or otherwise
respond to requests to or from any third parties involving the
possible sale of the Company or any of its subsidiaires, unless
specifically authorized to do so by the Company or the
controlling shareholder of the Company. The obligations of
Employee under this Section 5 shall be in addition to, and
shall not limit, any other obligation of Employee to the
Company with respect to the matters set forth herein or
otherwise.
6. Covenant Not to Compete. In order to induce the Company to
enter into this Agreement, Employee hereby agrees that as of
the date Termination Benefits begin and for a period of one (1)
year thereafter (exclusive of any period of breach), Employee
will not, without the prior written consent of the Company,
work for, be employed by or otherwise provide services (which
are substantially the same or similar to the services provided
by Employee to the Company) to, Harnischfeger Industries, Inc.,
("Harnischfeger"), any affiliated entity of Harnischfeger or
any other entity that engages in the business of manufacturing,
marketing, distributing or selling any surface mining equipment
that the Company or any of its subsidiaries or affiliates
manufactures, markets, distributes or sells at the time
Employee ceases to be employed by the Company.
Employee agrees that such restriction is fair and reasonably
necessary to protect the legitimate business interests of the
Company, and that the Company would suffer irreparable harm in
the event of the breach of Employee. As a result, Employee
agrees that the Company shall, in addition to other remedies
provided by law, be entitled to injunctive relief in the event
of breach by Employee.
7. Assignments and Transfers. Employee agrees that he will not
assign, sell, transfer, delegate or otherwise dispose of,
whether voluntarily or involuntarily, or by operation of law,
any rights or obligations under this Agreement, nor shall
Employee rights be subject to encumbrance or the claims of
creditors. Any purported assignment shall be null and void.
This Agreement shall inure to the benefit of and be enforceable
by Employee personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and
legatees. This Agreement shall be binding upon and shall inure
to the benefit of the Company and its successors and assigns,
and the Company shall require any successor or assign to
expressly assume and agree to perform this Agreement in the
same manner and to the same extent that the Company would be
required to perform it if no such succession or assignment had
taken place, except no assumption shall be required if this
Agreement is automatically assumed by operation of law. The
term "the Company" as used herein shall include such successors
and assigns. The term "successors and assign" as used herein
shall include a corporation or other entity acquiring at least
51% of the outstanding shares of the Company or any of its
subsidiaries or all or substantially all of the assets and
business of the Company or any of its subsidiaries.
8. Notices. For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and
shall be deemed to have been duly given and received when
delivered or mailed by United States registered or certified
mail, return receipt requested, postage prepaid, addressed to
the Company at:
Bucyrus International, Inc.
P. O. Box 000
0000 Xxxxxxxxx Xxxxxx
Xxxxx Xxxxxxxxx, XX 00000
Attn: Vice President Human Resources
and to:
Xxxxxx X. Xxxxxxxx
0000 Xxxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
or such address as either party may have furnished to the other
in writing in accordance herewith, except that notices of
change of address shall be effective only upon receipt.
9. Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of
the State of Wisconsin.
10. Entire Agreement. The terms of this Agreement are intended by
the parties to be the final expression of their agreement with
respect to Employee's termination benefits as it relates solely
to termination caused by a change of control and may not be
contradicted by evidence of any prior or contemporaneous
agreement.
11. Amendments; Waivers. This Agreement may not be modified,
amended, or terminated except by an instrument in writing,
signed by Employee and by a duly authorized representative of
the Company other than Employee. No failure to exercise and no
delay in exercising any right, remedy or power hereunder shall
operate as a waiver thereof, nor shall any single or partial
exercise of any right, remedy, or power hereunder preclude any
other or further exercise thereof or the exercise of any other
right, remedy, or power provided herein or by law or in equity.
12. Severability; Enforcement. If any provision of this Agreement,
or the application thereof to any person, place or
circumstances, shall be held by a court of competent
jurisdiction to be invalid, unenforceable, or void, the
remainder of this Agreement and such provisions as applied to
other person, places, and circumstances shall remain in full
force and effect.
13. Arbitration. The parties agree to submit any dispute arising
under this Agreement to arbitration. Arbitration shall be by a
single arbitrator in the Milwaukee, Wisconsin area experienced
in the matters at issue selected by the Company and Employee in
accordance with the commercial arbitration rules of the
American Arbitration Association. The decision of the
arbitrator shall be final and binding as to any manner
submitted to him under this Agreement. All costs and expenses
incurred in connection with any such arbitration proceeding
shall be borne by the party against whom the decision is
rendered as provided by the arbitrator.
14. Release.
(a) Employee on behalf of himself, his heirs, executors,
legal representative, successors and assign, hereby fully
and forever releases and discharges the Company, and its
respective affiliates, subsidiaries, parents,
predecessors and successors, and each of their officers,
directors, trustees, employees, agents and attorneys,
past and present (the "Releasees"), from any and all
claims, demands or causes of action, whether now known or
unknown, which have existed, which do exist, or which my
exist in the future, arising out of or relating in any
way to Employee furnishing of services to the Company,
his compensation, the termination of his relationship
with the Company, the sale of the stock or assets of the
Company or any of its subsidiaries and/or any other
occurrence up to and including the effective date of this
Agreement, except those claims statutorily precluded from
waiver or release by private parties and except those
alleging breach of this Agreement. Without in any way
limiting the generality of the foregoing language, this
release includes any claims for relief or causes of
action under the Age Discrimination in Employment Act, as
amended, Title VII of the Civil Rights Act of 1964, as
amended, the Americans with Disabilities Act of 1990, the
Civil Rights Act of 1991, and any other federal, state or
local statute, ordinance or regulation dealing in any
respect with discrimination in employment, and in
addition thereto, any claims under any Company severance
policy, practice or procedure, and any claims, demands or
actions brought on the basis of alleged wrongful or
retaliatory discharge and/or alleged breach of an implied
or explicit, written or oral employment or other contract
or covenant under the common law of any state, including,
but not limited to, Wisconsin.
(b) Employee further agrees not to directly or indirectly
pursue or initiate any action or legal proceeding of any
kind against the Releasees arising out of or related to
the claims released in Section 13(a) above, or the sale
of the stock or assets of the Company or any of its
subsidiaries and also waives any right to recover any
relief as a result of any such proceedings initiated on
his behalf.
15. Termination Date. This Agreement shall be null and void in the
event that a Change in Control does not occur on or before the
Expiration Date.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered as of the day and year set forth above.
BUCYRUS INTERNATIONAL, INC. Employee
a Delaware Corporation
By: /s/X. X. Xxxxxxxx /s/X. Xxxxxxxx
Xxxxxxx X. Xxxxxxxx Xxxxxx X. Xxxxxxxx
Its: President & Chief Operating Officer
