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EXHIBIT 10.9
This AMENDED AND RESTATED AGREEMENT made this 1st day of
February 1996, by and between Lone Star Industries, Inc., a corporation
organized under the laws of the State of Delaware with its principal office at
000 Xxxxx Xxxxxxxx Xxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000 and its successors and
assigns (the "Corporation"), and Xxxxxxx X. Xxxxxxxx (the "Executive") residing
at 00 Xxxxx Xxxxx, Xxxxxx, Xxxxxxxxxxx 00000 (the "Agreement").
W I T N E S S E T H:
WHEREAS, the Executive is currently employed as President and
Chief Operating Officer at the Corporation; and
WHEREAS, the Corporation and the Executive previously entered
into an employment agreement, dated August 17, 1987 (the "1987 Agreement")
which provided for certain supplemental retirement benefits for the Executive
and his spouse; and
WHEREAS, the Corporation and the Executive entered into a
subsequent employment agreement, dated June 26, 1990 (the "1990 Agreement")
which also provided for supplemental retirement benefits for the Executive and
his spouse; and
WHEREAS, the 1987 Agreement and the 1990 Agreement also
provided the Executive, his spouse and eligible dependents with enhanced health
and medical coverage; and
WHEREAS, on December 10, 1990 the Corporation and certain of
its subsidiaries filed in this Court (the "Bankruptcy Court") their respective
voluntary petitions for reorganization under Chapter 11 of Title 11 of the
United States Code; and
WHEREAS, subsequently, on December 21, 1990, Lone Star
Building Centers, Inc. and Lone Star Building Centers (Eastern), Inc. filed
their respective voluntary petitions under Chapter 11 of the Bankruptcy Code;
and
WHEREAS, the 1990 Agreement was rejected by the Corporation,
with the Executive's consent, by order of the U.S. Bankruptcy Court, dated
March 28, 1991; and
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WHEREAS, on or about June 26, 1991, the Executive filed a
proof of claim against the Corporation asserting, among other things,
contingent and unliquidated damages resulting from the rejection of the 1990
Agreement; and
WHEREAS, on April 14, 1994, the Bankruptcy Court approved a
settlement with respect to the Executive's claims relating the supplemental
retirement and medical benefits in exchange for the assumption of certain
obligations by the Corporation; and
WHEREAS, on April 14, 1994, the Corporation and the Executive
entered into an Agreement (the "1994 Agreement") to provide certain
supplemental and medical benefits; and
WHEREAS, the Corporation and the Executive desire to amend and
restate the 1994 Agreement; and
NOW, THEREFORE, in consideration of the agreements hereinafter
contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.1 "ANNUITY" shall mean National Home Life Assurance
Company Policy Number N101058 (August 7, 1989).
1.2 "BOARD" shall mean the Board of Directors of the
Corporation or its duly authorized committee.
1.3 "DISABILITY" shall mean Executive's inability,
because of physical or mental incapacity, to perform in a competent manner
executive duties of a nature equivalent to the duties the Executive currently
performs.
1.4 "DISCONTINUATION DATE" shall mean the date of the
later to occur of: (i) the death of the Executive; or (ii) the death of the
Spouse.
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1.5 "EMPLOYMENT AGREEMENT" shall mean the employment
agreement between the Executive and the Corporation, dated August 20, 1993.
1.6 "PLAN" shall mean the Lone Star Industries, Inc.
Salaried Employees Pension Plan.
1.7 "QUALIFIED DEPENDENTS" shall mean the Executive's:
(i) spouse, if not divorced or legally separated from the Executive; (ii)
children under the age of (A) 19 or (B) 23 if a full-time student, unmarried,
and not employed on a regular and full-time basis, and dependent on the
Executive for support; provided however, if due proof is received within 31
days of the day the Qualified Dependent has reached his maximum age that he is
incapable of self-sustaining employment by reason of mental retardation or
physical handicap, the child shall continue to be deemed a dependent after such
birthday, for purposes of only accident and health coverage; and (iii) legally
adopted children, or children living in a parent-child relationship and
primarily dependent on the Executive.
1.8 "SPOUSE" shall mean the Executive's legal spouse on
the Termination Date.
1.9 "TERMINATION DATE" shall mean the date of the earlier
to occur of the date the Executive: (i) attains age 65; or (ii) ceases
full-time employment with the Corporation.
ARTICLE II
2.1 AMOUNT OF BENEFITS.
(a) Lone Star agrees that Executive's annual
retirement benefits at age 65 shall include the sum of: (X) the annual
retirement benefits paid to Executive pursuant to the Plan and (Y) the annual
payments to which the Executive is entitled under the Annuity, whether or not
payable but shall not be less than $225,000.
(b) Except as provided below, the benefits shall
commence at age 65 and shall continue until the Discontinuation Date.
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2.2 BENEFITS PAYABLE BEFORE AGE 65. Effective upon the
Termination Date, the Executive may elect to receive the annual retirement
benefits pursuant to Section 2.1 from the Corporation on or after the date the
Executive attains the age of 55; provided however, such benefits shall be
reduced by 5% for each full year that benefits commence prior to the attainment
of age 62 by the Executive. No such reduction in benefits shall occur on or
after the date the Executive attains the age of 62. The benefits shall be paid
until the Discontinuation Date.
2.3 BENEFITS PAYABLE ON DISABILITY. In the event of
Executive's Disability at any age prior to the commencement of retirement
benefits pursuant to Sections 2.1 or 2.2, the annual retirement benefits
pursuant to Section 2.1 shall commence immediately and shall continue until the
Discontinuation Date. There shall be no reduction in benefits for Executive's
age at date of Disability.
2.4 BENEFITS PAYABLE UPON DEATH. In the event of Executive's
death prior to the Termination Date, the annual retirement benefits called for
by Section 2.1 shall be paid to the Spouse until the Discontinuation Date.
Benefits paid to the Spouse shall be reduced by 5% for each full year that
Executive's age at death is less than age 62.
2.5 PAYMENT OF BENEFITS. There shall be no reduction in
benefits payable under this Agreement due to the age of the Spouse. All
payments under this Agreement shall be made to the Executive until his death,
and then to the Spouse for her life if she survives the Executive.
2.6 PURCHASE OF ANNUITY. The Corporation agrees to
purchase within thirty days after the Termination Date, an annuity from a
reputable provider of annuities rated at least "AA" by Standard & Poors for the
Executive and the Spouse which provides annual retirement benefits to Executive
and his Spouse equal to the retirement benefits called for by this Agreement in
excess of the benefits provided under the Plan and the Annuity. Within 30 days
after the purchase of such annuity, the Corporation shall pay the Executive an
amount equal to the federal income taxes which shall be payable by the
Executive upon receipt of the annuity, said amount to be grossed up to reflect
the additional taxes payable due to the receipt of said payment. The
retirement benefits provided by the annuity shall be adjusted for this payment
of federal income taxes so that the after tax retirement benefits provided by
the annuity are at least equal to the after tax retirement benefits the
Executive would have received from Lone Star had Lone Star paid the retirement
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benefits directly rather than provide the retirement benefits through the
annuity.
ARTICLE III
HEALTH AND MEDICAL BENEFITS
From the date hereof until the Discontinuation Date, the
Corporation agrees to provide the Executive with life insurance and the
Executive and Qualified Dependents with medical insurance at no cost to the
Executive and Qualified Dependents at least equal to the life and medical
insurance provided to senior elected officers of the Corporation; provided
however, upon the earlier to occur of the Executive's attainment of age 65 or
the Executive's application for a pension benefit under the Plan, the medical
benefits provided to the Executive and Qualified Dependents shall be at least
equal to the medical benefits described in Appendix A; provided further, the
annual deductible for medical coverage described in Exhibit A is $1,000.00 for
the Executive and each Qualified Dependent prior to each such individual's
attainment of the age of 65 and $750.00 for each individual after such
individual's attainment of the age of 65. The Executive and the Spouse are
each entitled to receive monthly reimbursement of Medicare Part B premiums
until the Discontinuation Date.
The Corporation agrees to use its best efforts to provide the
benefits listed on Appendix A to the Executive and his spouse in a manner that
will not result in any income inclusion under federal, state or local tax law.
To the extent, any such income inclusion results to either the Executive or his
spouse, the Executive and his spouse (as the case may be) shall receive an
annual payment from the Corporation to fully pay for the federal, state or
local tax on such income inclusion (a "Gross-up Payment") as well as any income
inclusion from the Gross-up Payment based on the highest marginal tax rate on
the payment, so that neither the Executive nor his Spouse have any federal,
state or local tax liability as a result of participation in the Executive
Medical Plan on Exhibit A. For each year, such payment shall be made no later
than January 31st of the following year.
No later than 120 days after the date hereof, the Corporation
shall purchase an insurance policy covering the Executive Medical Plan to
insure non-payment by the Corporation in accordance with the terms on Exhibit
B.
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This section shall survive any termination of this Agreement.
ARTICLE IV
4.1 DISPUTE RESOLUTION.
(a) The Executive hereby agrees that any dispute
relating to this Agreement arising between the Executive (and/or the Spouse)
and the Corporation (or any successor or assign) shall be settled by
arbitration in accordance with the commercial arbitration rules of the American
Arbitration Association ("AAA"). The arbitration proceeding, including the
rendering of an award, shall take place in Stamford, Connecticut, (or such
other location mutually agreed upon by the Corporation and the Executive
(and/or the Spouse)) and shall be administered by the AAA.
(b) The arbitral tribunal shall be appointed
within 30 days of the notice of dispute, and shall consist of three
arbitrators, one of which shall be appointed by the Company, one by the
Executive, and the third by both the Company and the Executive (and/or the
Spouse) jointly; provided, however, that, if the Company and the Executive
(and/or the Spouse) do not select the third arbitrator within such 30-day
period, such third arbitrator shall be chosen by the AAA as soon as practicable
following notice to the AAA by the parties of their inability to choose such
third arbitrator.
(c) Decisions of such arbitral tribunal shall be
in accordance with the laws of the State of Connecticut (excluding the
conflicts of law rules which require the application of any other law). The
award of any such arbitral tribunal shall be final (except as otherwise
provided by the laws of the State of Connecticut and the Federal laws of the
United States, to the extent applicable). Judgement upon such award may be
entered by the prevailing party in any state or Federal court sitting in
Connecticut or any other court having jurisdiction thereof, or application may
be made by such party to any such court for judicial acceptance of such award
and an order of enforcement.
(d) The Corporation shall reimburse the Executive
and Spouse for all costs, including reasonable attorneys' fees, in connection
with any arbitration hereunder in which the Executive (and/or the Spouse) is
the prevailing party.
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ARTICLE V
MISCELLANEOUS
5.1 UNFUNDED PLAN. This Agreement is unfunded and shall
at all times remain unfunded until required pursuant to Section 2.6. The
obligations of the Corporation with respect to the benefits payable hereunder
shall be paid out of the Corporation's general assets and shall not be secured.
At its discretion, the Corporation may establish one or more trusts, with such
trustees as the Board may appoint, for the purpose of providing payment of such
benefits. Such trust or trusts may be irrevocable, but the assets thereof
shall be subject to the claims of the Corporation's creditors. To the extent
any benefits provided under the Agreement are actually paid from any such
trust, the Corporation shall have no further obligation with regard thereto,
but to the extent not so paid, such benefit shall remain the obligation of, and
shall be paid by the Corporation. To the extent that any person acquires a
right to receive payments from the Corporation under this agreement, such right
shall be no greater than the right of any unsecured general creditor of the
Corporation.
5.2 NO EFFECT ON EMPLOYMENT. Nothing contained herein
shall be construed as adversely affecting, in any manner, the terms and
conditions of the Executive's employment including, without limitation, the
terms and conditions of the Employment Agreement; provided however, in the
event there are any conflicts between this Agreement and the Employment
Agreement regarding supplemental retirement benefits and life and medical
insurance, the terms of this Agreement shall prevail.
5.3 PAYMENTS NOT COMPENSATION. Any compensation payable
under this Agreement shall not be deemed salary or other compensation to the
Executive for the purposes of computing benefits to which he may be entitled
under any pension plan or other arrangement of the Corporation for the benefit
of its employees.
5.4 NO REDUCTION IN PLAN BENEFITS. Nothing in this
Agreement shall reduce the benefits to which the Executive and the Spouse are
entitled under the Plan.
5.5 INVALIDITY. In case any provision of this Agreement
shall be illegal or invalid for any reason, said illegality or invalidity shall
not affect the remaining parts
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hereof, but this Agreement shall be construed and enforced as if such illegal
and invalid provision never existed.
5.6 WITHHOLDING OF TAXES. The Corporation shall have
the right to make such provisions as it deems necessary or appropriate to
satisfy any obligations it may have to withhold federal, state or local income
or other taxes incurred by reason of payments pursuant to this Agreement.
5.7 Binding Affect. This Agreement shall be binding
upon and inure to the benefit of the Corporation, including any purchaser of
all or substantially all of the assets of the Corporation and the surviving
entity of any merger or consolidation to which the Corporation is a party and
the Executive and his heirs, executors, administrators and legal
representatives.
5.8 NO ASSIGNMENT. Except as provided herein, the
benefits payable under this Agreement shall not be subject to alienation,
transfer, assignment, garnishment, execution or levy of any kind, and any
attempt to cause any benefits to be so subjected shall not be recognized.
5.9 GOVERNING LAW. This Agreement shall be construed in
accordance with and governed by the laws of the State of Connecticut.
IN WITNESS WHEREOF, the Corporation has caused this Agreement
to be executed by its duly authorized officers and the Executive has hereunto
set his hand and seal as of the date first above written.
By: /s/ Xxxxxxx X. Xxxxxxxx
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LONE STAR INDUSTRIES, INC.
By: /s/ Xxxxx X. Xxxxxxx
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Chairman of the Board
By: /s/ Xxxx X. Xxxxxxxxx
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Chairman of the
Compensation and Stock
Option Committee
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