AMENDED AND RESTATED
AGREEMENT
WHEREAS, Handy & Xxxxxx ("H&H") and Xxxxxx X. Xxxxx ("Executive") are parties
to an agreement dated January 26, 1998 providing for certain payments and
benefits to Executive in the event of a Change of Control of H&H;
WHEREAS, Executive is employed by H&H;
WHEREAS, H&H desires to retain Executive's services in the event of a Change
of Control (as defined below) of H&H; and
WHEREAS, the parties desire to amend and restate the Agreement to reflect
certain changes which have been agreed between them;
NOW THEREFORE, in consideration of the agreements and provisions set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Term of Agreement. This Agreement shall commence on the date hereof and
shall continue in effect thereafter, unless, not later than any September 30,
H&H shall have given notice that it will not extend this Agreement beyond the
ensuing December 31; provided, however, that no such notice to terminate may
be given by H&H after such Change of Control, and any such notice given by H&H
before such Change of Control, but which would cause this Agreement to
terminate on a December 31 following the Change of Control, shall have no
effect. If a Change of Control shall have occurred during the term of this
Agreement, this Agreement shall continue in effect until all of H&H's
obligations hereunder have been discharged.
2. Change of Control of H&H. No benefits shall be payable unless there is a
change of control ("Change of Control") of H&H. A Change of Control shall be
deemed to have occurred if:
(a) any "person", as such term is used in Sections 13(d) and 14(d) of
the Exchange Act (other than H&H, any trustee or other fiduciary
holding securities under an employee benefit plan of H&H or any
corporation owned, directly or indirectly, by the stockholders of H&H
in substantially the same proportions as their ownership of stock of
H&H), is or becomes the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act), directly or
indirectly, of securities of H&H representing 25% or more of the
combined voting power of H&H's then outstanding securities;
(b) during any period of not more than two (2) consecutive years (not
including any period prior to January 26, 1998), individuals who at
the beginning of such period constitute the Board of Directors and
any new director (other than a director designated by a person who
has entered into an agreement with H&H to effect a transaction
described in clause (a), (c) or (d) of this Section) whose election
by the Board of Directors or nomination for election by H&H's
stockholders was approved by a vote of at least two-thirds (2/3) of
the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election
was previously so approved, cease for any reason to constitute at
least a majority thereof;
(c) the stockholders of H&H approve a merger or consolidation of H&H
with any other corporation, other than (A) a merger or consolidation
which would result in the voting securities of H&H outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of
the surviving entity) more than 70% of the combined voting power of
the voting securities of H&H or such surviving entity outstanding
immediately after such merger or consolidation or (B) a merger or
consolidation effected to implement a recapitalization of H&H (or
similar transaction) in which no "person" (as herein above defined)
acquires more than 50% of the combined voting power of H&H's then
outstanding securities; or
(d) the stockholders of H&H approve a plan of complete liquidation of
H&H or an agreement for the sale or disposition by H&H of all or
substantially all of H&H's assets.
3. Termination Following Change of Control. If any of the events described in
Section 2 above constituting a Change of Control shall have occurred,
Executive shall be entitled to the benefits provided in Section 4 hereof upon
termination of Executive's employment with H&H during the two (2) year period
following the Change of Control unless such termination is (A) a result of
Executive's death or retirement, or (B) Executive's resignation for other than
Good Reason, or (C) Executive's being terminated by H&H for Disability or for
Cause.
(a) Cause. For purposes of this Agreement, "Cause" shall mean Execu-
tive's willful breach of duty in the course of Executive's
employment, or Executive's habitual neglect of his employment duties.
(b) Disability. For purposes of this Agreement, "Disability" shall
mean Executive's absence from his duties with H&H for three hundred
sixty-five (365) consecutive days as a result of his physical or
mental illness.
(c) Good Reason. Executive shall be entitled to terminate his
employment for Good Reason. For the purposes of this Agreement, "Good
Reason" shall mean the occurrence of any of the following
circumstances:
(i) the assignment to Executive of any duties
inconsistent with his status as a Corporate Vice President
(or any higher position to which Executive has been promoted
at the time) or a substantial diminution in the nature or
status of his responsibilities from those in effect
immediately prior to the Change of Control;
(ii) a reduction in Executive's annual base salary
as in effect on the date of the Change of Control;
(iii) the relocation of the office in which
Executive is located prior to the Change of Control to a
location more than sixty (60) miles from Cockeysville,
Maryland;
(iv) Executive's selective exclusion, pursuant to
an action taken by H&H, from a compensation, bonus, stock
option or stock ownership plan either in existence at the
time of the Change of Control or thereafter put into effect
for the benefit of others in a similar situation;
(v) except as required by law, the failure by H&H
to continue to provide Executive with benefits at least as
favorable as those enjoyed by Executive under the employee
benefit and welfare plans of H&H in which he was
participating at the time of the Change of Control;
(vi) the failure of H&H to obtain a satisfactory
agreement from any successor to assume and agree to perform
this Agreement, as contemplated in Section 5 hereof; or
(vii) any purported termination of Executive's
employment not effected pursuant to a Notice of Termination
satisfying the requirements of Section 4(d) below; for
purposes of this Agreement, no such purported termination
shall be effective.
Executive's continued employment shall not constitute consent to, or a waiver
of rights with respect to, any circumstance constituting Good Reason
hereunder.
(d) Notice of Termination. Any termination of Executive's employment
by H&H or by Executive shall be communicated by written Notice of
Termination to the other party hereto in accordance with Section 8
hereof. For purposes of this Agreement, a "Notice of Termination"
shall mean a notice indicating the specific termination provision in
this Agreement relied upon and setting forth in reasonable detail the
facts and circumstances claimed to provide a basis for termination of
Executive's employment under the provision so indicated.
(e) Date of Termination. Etc. "Date of Termination" shall mean thirty
(30) days after the date specified in the Notice of Termination.
4. Compensation Upon Termination. Following a Change of Control of H&H, as
defined herein, upon termination of Executive's employment by (a) H&H other
than for Cause or for Disability or (b) by Executive for Good Reason,
Executive shall be entitled to the following benefits:
(a) H&H shall pay Executive a severance payment (the "Severance
Payment") equal to one year's full base salary at Executive's highest
rate in effect during the period beginning twelve (12) months before
the date on which the Change of Control occurs and ending on the date
on which the Notice of Termination is given;
(b) For a twelve (12) month period after termination of Executive's
employment, H&H shall arrange to provide Executive with life, medical
and dental insurance benefits substantially similar to those which
Executive is receiving or entitled to receive immediately prior to
the Notice of Termination, unless Executive is eligible to receive
such benefits from a subsequent employer or a spouse's employer; and
(c) H&H shall pay Executive the Severance Payment no later than the
fifth (5th) day following the Date of Termination.
5. Successors; Binding Agreement.
(a) H&H will require any successor to all or substantially all of the
business and/or assets of H&H to expressly assume and agree to
perform this Agreement in the same manner and to the same extent that
H&H is required to perform it. Failure of H&H to obtain such
assumption and agreement prior to the effectiveness of any such
succession shall be a breach of this Agreement and shall entitle
Executive to an immediate lump sum payment equal to the sum of (i)
the Severance Payment to which Executive would be entitled under
Section 4(a) hereof if Executive had terminated Executive's employ-
ment for Good Reason following a Change of Control of H&H and (ii)
the present value of the continuing benefits to which Executive would
have been entitled under Section 4(b) hereof if Executive had
terminated his employment for Good Reason following a Change of
Control of H&H. All references to H&H shall be deemed to include its
successors.
(b) This Agreement shall inure to the benefit of and be enforceable
by Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and
legatees. If Executive dies while any amount is payable to him
hereunder, all such amounts shall be paid in accordance with the
terms of this Agreement to Executive's devisee, legatee or other
designee or, if there is no such designee, to Executive's estate.
6. Section 280G Limitation. Notwithstanding any other provision of this
Agreement, the payments and benefits to which Executive is otherwise entitled
under Section 4 hereof will be reduced to the extent necessary so that no
portion thereof is nondeductible under Section 280G of the Internal Revenue
Code of 1986, as amended, (the "Code"). Within five (5) days of the Date of
Termination, H&H shall provide Executive with the calculations undertaken by
H&H for the purposes of applying the previous sentence (the "Calculations").
If Executive does not agree with the Calculations, Executive may object within
fourteen (14) days of receipt of the Calculations by giving written notice to
H&H, setting forth in reasonable detail the basis of Executive's objection to
the Calculations which shall include a set of calculations which Executive
believes is correct (the "Recalculations"). If H&H does not accept Executive's
Recalculations, it shall notify Executive of such disagreement within seven
(7) days. The parties shall then attempt to resolve their disagreement within
seven (7) days. If the parties are unable to resolve their disagreement within
such period, the dispute shall be submitted to arbitration in accordance with
Section 7.
7. Arbitration; Certain Costs. Any dispute or controversy between H&H and
Executive, whether arising out of or relating to this Agreement, the breach of
this Agreement, or otherwise, shall be settled by arbitration administered by
the American Arbitration Association in accordance with its Commercial Rules
then in effect and judgment on the award rendered by the arbitrator may be
entered in any court having jurisdiction thereof. Such arbitration shall take
place in the New York City metropolitan area. The arbitrator shall have the
authority to award any remedy or relief that a court of competent jurisdiction
could order or grant, including, without limitation, the issuance of an
injunction. However, either party may, without inconsistency with this
arbitration provision, apply to any court having jurisdiction over such
dispute or controversy and seek interim provisional, injunctive or other
equitable relief until the arbitration award is rendered or the controversy
is otherwise resolved. H&H shall reimburse Executive, upon demand, for all
costs and expenses (including without limitation attorneys' fees) reasonably
incurred by Executive in good faith in connection with this arbitration
provision, including without limitation in connection with any such
application undertaken by Executive in good faith, as well as for all such
costs and expenses reasonably incurred by Executive in connection with
entering and/or enforcing the award rendered by the arbitrator. Except as
necessary in court proceedings to enforce this arbitration provision or an
award rendered hereunder, or to obtain interim relief, neither a party nor an
arbitrator may disclose the existence, content or results of any arbitration
hereunder without the prior written consent of H&H.
8. Notice. For the purposes of this Agreement, notices and all other communica-
tions provided for in this Agreement shall be in writing and shall be deemed
to have been duly given when delivered or mailed by United States registered
mail, return receipt requested, postage prepaid, addressed to the respective
addresses set forth on the first page of this Agreement, provided that all
notices to H&H shall be directed to the attention of the Senior Vice President
and General Counsel, or to such other address as either party may have
furnished to the other in writing in accordance herewith, except that notice
of change of address shall be effective only upon receipt.
10. Miscellaneous. No provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in
writing and signed by both parties. No waiver by either party at any time of
any breach by the other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same or any prior or subsequent
time. No agreements or representations, oral or written, express or implied,
with respect to the subject matter hereof have been made by either party which
are not expressly set forth in the Agreement. The validity,
interpretation, construction and performance of this Agreement shall be
governed by the laws of the State of New York. All references to sections of
the Code shall be deemed also to refer to any successor provisions to such
sections. Any payments provided for hereunder shall be paid net of any
applicable withholding required under federal, state or local law.
11. Validity. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Amended and Restated
Agreement on the day of February, 1998.
Handy & Xxxxxx
/s/ Xxxxxx X. Xxxxx /s/ Xxxxx X. Xxxxxxxxx
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by: Xxxxxx X. Xxxxx by: Xxxxx X. Xxxxxxxxx
Vice Chairman
