Xx. Xxxx X. Xxxxxxxx, Vice President
RAMCO Operating Company
One Xxxxxx Place, Suite 130
0000 X. Xxxxxxxx
Xxxxxxxx Xxxx, XX 00000
Re: Employment and Severance Agreement
Dear Xxxx:
This letter agreement (this "Agreement"), when executed by you in the
time and manner hereinafter provided, will constitute an employment and
severance agreement between you and RAMCO Operating Company (the "Company"),
superseding all existing employment, severance and similar agreements between
you and the Company; provided, however, that the existing Employment and
Severance Agreement between you and the Company dated March 31, 1997, shall
continue in effect until December 31, 1997. The terms of this Agreement are
as follows:
1. TERM. The term of this Agreement shall commence January 1, 1998,
and shall continue until December 31, 1998.
2. TITLE; DUTIES. You job title will be "Senior Vice President and
Treasurer" of the Company. You will perform duties commensurate with your
position and as assigned to you by the President or Chairman of the Company
or their designee. During the term of this Agreement you will devote your
full time and attention during normal business hours to the business of the
Company and will not be employed by or perform any professional work or
services, including consulting for any other person, firm or entity.
3. SALARY. Your base salary will be $11,666.67 per month, payable
twice monthly in equal installments, less applicable withholding and other
payroll taxes and deposits. Additionally, you will receive life, disability
and health insurance, expense account and other benefits as are available to
other non-director officers of the Company, and three weeks paid vacation
annually during the term hereof.
4. TERMINATION OF EMPLOYMENT.
4.1 BY THE COMPANY. Your employment may be terminated by the
Company at any time upon two weeks prior written notice (except where
termination is for gross neglect of your duties, breach by you of the terms
of this Agreement or willful misconduct, hereinafter referred to as "Good
Cause", in which event termination may be effective immediately upon notice).
Subject to the provisions in Section 4.3 hereof regarding termination of
employment following a "Change of Control" (as hereinafter defined), in the
event your employment is terminated by the Company at any time (i) prior to
June 30, 1998 (other than for Good Cause), you will be entitled to receive as
a severance payment (A) an amount equal to your monthly base salary times the
number of months (pro rated for any partial month if the effective date of
the termination is other than the
end of a month) remaining until the expiration of the term hereof, plus (B)
an amount equal to your monthly base salary times the number of years (pro
rated for any partial year) you have been employed by the Company, or (ii)
after June 30, 1998 (other than for Good Cause), you will be entitled to
receive as a severance payment (A) an amount equal to six (6) times your
monthly base salary, plus (B) an amount equal to your monthly base salary
times the number of years (pro rated for any partial year) you have been
employed by the Company, all less applicable withholding and other payroll
taxes and deposits. For purposes of the foregoing, the date of your initial
employment with the Company shall be conclusively determined to be June 1,
1990, such that each full year of your employment with the Company shall end
on May 31 of each subsequent year. In addition to the payment described at
(i) or (ii) above, whichever is applicable, you also shall be entitled to
receive payment for accrued but unused vacation based on your monthly base
salary. In the event your employment is terminated by the Company at any
time for Good Cause, you shall not be entitled to receive any severance
payment other than for accrued but unused vacation. In the event the Company
fails to make any salary payment due under this Agreement after the due date,
and provided you are not in breach of the terms of this Agreement, you may
terminate your employment at any time thereafter (but prior to the time the
delinquent payment is made) by a written notice to the President or Chairman
of the Company, in which event your employment will be deemed to have been
terminated by the Company for purposes of this Section 4.1 as of the date
such notice is delivered.
4.2 BY YOU. If during the term hereof you terminate (other than a
termination by you pursuant to the last sentence of Section 4.1) or are
deemed to have terminated (by becoming an employee of or performing
professional work for or consulting with any other person, firm or entity)
your employment with the Company, then you shall not be entitled to receive
any severance payment (other than for accrued but unused vacation as
provided in Section 4.1 above).
4.3 TERMINATION FOLLOWING A CHANGE IN CONTROL. In the event a
Change of Control occurs during the term hereof, and following such Change of
Control (i) your employment is terminated by the Company (other than for Good
Cause) during the term hereof, or (ii) you are not offered, prior to December
1, 1998, a renewal contract for calendar year 1999 for employment by the
Company (or its successor by merger), in a comparable position in the same
general location (i.e., the same city or metropolitan area in which you are
employed by the Company at the time such Change of Control occurs), at not
less than the same salary, and with comparable severance and other benefits
as provided under this Agreement (other than a Change of Control provision
such as this Section 4.3), then upon the effective date of termination of
your employment (in the case of clause (ii) next above, December 31, 1998),
you will be entitled to receive as a severance payment the same amount
calculated pursuant to Section 4.1 hereof, EXCEPT that the amount calculated
pursuant to clause (i) (B) or (ii) (B) of Section 4.1, whichever is
applicable, shall be doubled, that is, in addition to the amount calculated
pursuant to clause (i) (A) or (ii) (A), you shall receive two (2) month's
base salary for each year of employment by the Company (pro rated for a
partial year). As used herein, the term "Change of Control" shall mean any
change in the composition of the Board of Directors of the Company (the
"Board") resulting in the current directors (M. Xxxxx Xxxxxxx, Xxxxx X. Xxx
and Xxxxxxx X. Xxxxxx, XX) or their designees (in the event one or more of
the current directors chooses not to serve as a director), comprise less than
one-half (1/2) of the members of the Board. Notwithstanding the foregoing,
in no event
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shall you ever be entitled to receive as a severance payment upon a Change of
Control an amount that would result in the imposition of the excise tax
provided for in Section 4999 of the Internal Revenue Code of 1986, as amended
(the "Excise Tax"), and in the event the severance payment calculated
pursuant to this Section 4.3 would result in the imposition of the Excise
Tax, the amount so calculated shall be reduced to the amount that is one
dollar ($1) less than the amount that would result in the imposition of the
Excise Tax.
4.4 DEATH OR DISABILITY. In the event you die during the term
hereof, your employment will be deemed to have terminated by the Company
(other than for cause) as of the date of death. In the event you become
permanently disabled during the term hereof, you shall continue to receive
your base salary for a period of 12 months following the date of disability
and shall be deemed an employee of the Company during such 12-month period
for purposes of other employee benefit plans and programs, except to the
extent prohibited by the terms of any such plan.
5. RENEWAL. In the event the Company desires to continue your
employment with the Company beyond December 31, 1998, the Company will so
notify you during the month of November 1998, but in no event later than
November 30, 1998. In such event, the President of the Company will discuss
with you the Company's proposal for renewal of this Agreement for an
additional one-year term on substantially the same terms and conditions as
this Agreement at a salary not less than the salary provided herein. In the
event a renewal agreement as hereinabove described is not offered by the
Company, then provided you have complied with the provisions of Section 2 of
this Agreement at all times prior thereto, your employment will be deemed
terminated by the Company effective December 31, 1998. In the event a renewal
agreement as hereinabove described is offered by the Company but rejected by
you, then provided you have complied with the provisions of Section 2 of this
Agreement at all times prior thereto, your employment will be deemed
terminated by you effective December 31, 1998; however, and notwithstanding
the provisions of Section 4.2 hereof, in such event you will be entitled to
receive as a severance payment upon such termination an amount equal to three
(3) times your monthly base salary, plus an amount for accrued but unused
vacation based on your monthly salary, less applicable withholding and other
payroll taxes and deposits.
6. EXCLUSIVE OBLIGATION. You acknowledge and agree that the Company
has no obligation to continue your employment or to make any severance
payment of any nature upon termination of you employment except as provided
herein or in a subsequent written agreement by you and the Company.
7. INDEMNIFICATION. To the fullest extent allowed by the Delaware
General Corporation Law and the Company's bylaws with respect to its officers
and directors, the Company agrees to indemnify you and to hold you harmless
from and against any and all losses, claims, damages, liabilities and legal
and other expenses (including costs of investigation) incurred by you and
arising out of the performance of your duties and responsibilities under this
Agreement, regardless of the time such claim or cause of action is asserted.
8. CONFIDENTIALITY. The terms of this Agreement shall be held by you
in strict confidence and shall not be released or disclosed by you to any
third party.
9. GOVERNING LAW. This Agreement shall be governed by and construed
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and enforced in accordance with the laws of the State of Oklahoma applicable
to contracts made and to be performed entirely therein.
10. BINDING EFFECT. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors
(including successors by merger or reorganization) and assigns; provided,
however, that your obligations hereunder are personal in nature and may not
be assigned, and that the obligations of the Company hereunder may be
assigned only with your prior written consent.
If you are in agreement with the terms hereof, please so indicate by
executing a copy of this letter in the space provided and returning it to us
within five days of the date hereof.
Very truly yours,
RAMCO Operating Company
By /s/ XXXXX X. XXX
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Xxxxx X. Xxx, President
Agreed to and accepted
this 8th day of December, 1997
/s/ XXXX X. XXXXXXXX
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Xxxx X. Xxxxxxxx
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