MARTIN MARIETTA MATERIALS, INC. THIRD AMENDED AND RESTATED EMPLOYMENT PROTECTION AGREEMENT
This Employment Protection Agreement between Xxxxxx Xxxxxxxx Materials, Inc., a North Carolina
corporation (the “Company”), and (the “Employee”), dated as of this August 13,
2008 (the “Effective Date”).
W I T N E S S E T H:
WHEREAS, Employee is a valuable member of management of the Company and the Company desires to
ensure the continuity of its senior management; and
WHEREAS, it is the determination of the Company that management continuity is most likely to
occur if senior management is financially protected against involuntary termination following a
“Change of Control” (as defined below) of the Company; and
WHEREAS, this Agreement is entered into to provide the Employee with payments and benefits
upon certain terminations of the Employee’s employment with the Company in connection with a Change
of Control, in consideration of the Employee’s continued service to the Company (which the parties
hereto agree constitutes adequate consideration to support the Company’s obligations under this
Agreement); and
WHEREAS, the Company and the Employee desire to reflect their intention as set forth in this
Agreement.
NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, and
for other good and valuable consideration, the receipt and sufficiency of which are acknowledged,
it is hereby agreed by and between the Company and the Employee, each of whom intends to be legally
bound, as follows:
1. Definitions. For purposes of this Agreement,
(a) “Annual Bonus” shall mean the Employee’s highest annual bonus paid in a calendar
year beginning five years prior to a Change of Control and ending on the date of termination of
employment.
(b) “Base Salary” shall mean the highest annual rate of base salary that the Employee
receives from the Company or its affiliates in any pay period within the twelve-month period ending
on the date of a Change of Control; provided, however, that for purposes of calculating the payment
described in Section 3(a)(ii), “Base Salary” shall mean the highest annual rate of base salary that
the Employee receives from the Company or its affiliates in any pay period beginning five years
prior to a Change of Control and ending on the date of termination of employment.
(c) “Board” shall mean the Board of Directors of the Company.
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(d) “Cause” shall mean the Employee’s having been convicted in a court of competent
jurisdiction of a felony or has been adjudged by a court of competent jurisdiction to be liable for
fraudulent or dishonest conduct, or gross abuse of authority or discretion, with respect to the
Company, and such conviction or adjudication has become final and non-appealable. The Employee
shall not be deemed to have been terminated for Cause, unless the Company shall have given the
Employee (A) notice setting forth, in reasonable detail, the facts and circumstances claimed to
provide a basis for termination for Cause, (B) a reasonable opportunity for the Employee, together
with his counsel, to be heard before the Board and (C) a notice of termination stating that, in the
reasonable judgment of the Board, the Employee was guilty of conduct constituting Cause and
specifying the particulars thereof in reasonable detail.
(e) “Change of Control” shall mean:
(i) The acquisition by any individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”)) (an “Acquiring Person”) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange
Act) of 40% or more of either (A) the fully diluted shares of common stock
of the Company, as reflected on the Company’s financial statements (the
“Outstanding Company Common Stock”), or (B) the combined voting power of the
then outstanding voting securities of the Company entitled to vote generally
in the election of directors (the “Outstanding Company Voting Securities”);
provided, however, that for purposes of this subsection (i), the following
acquisitions shall not constitute a Change of Control: (X) any acquisition
by the Company or any “affiliate” of the Company, within the meaning of 17
C.F.R. § 230.405 (an “Affiliate”), (Y) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or
any Affiliate of the Company or (Z) any acquisition by any entity pursuant
to a transaction which complies with clauses (A), (B) and (C) of subsection
(iii) of this definition; or
(ii) Individuals who constitute the Incumbent Board cease for any reason to
constitute at least a majority of the Board; or
(iii) Consummation of a reorganization, merger or consolidation or sale or
other disposition of all or substantially all of the assets of the Company
(a “Business Combination”), in each case, unless, following such Business
Combination, (A) all or substantially all of the individuals and entities
who were the beneficial owners, respectively, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities immediately prior to
such Business Combination beneficially own, directly or indirectly, more
than 50% of, respectively, the then outstanding shares of common stock and
the combined voting power of the then
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outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the corporation resulting from such
Business Combination (including, without limitation, a corporation which as
a result of such transaction owns the Company or all or substantially all of
the Company’s assets either directly or through one or more subsidiaries) in
substantially the same proportions as their ownership, immediately prior to
such Business Combination, of the Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case may be, and (B) no Person
(excluding any employee benefit plan (or related trust) sponsored or
maintained by the Company or any Affiliate of the Company, or such
corporation resulting from such Business Combination or any Affiliate of
such corporation) beneficially owns, directly or indirectly, 40% or more of,
respectively, the fully diluted shares of common stock of the corporation
resulting from such Business Combination, as reflected on such corporation’s
financial statements, or the combined voting power of the then outstanding
voting securities of such corporation except to the extent that such
ownership existed prior to the Business Combination and (C) at least a
majority of the members of the board of directors of the corporation
resulting from such Business Combination were members of the Incumbent Board
at the time of the execution of the initial agreement, or of the action of
the Board, providing for such Business Combination; or
(iv) Approval by the shareholders of the Company of a complete liquidation
or dissolution of the Company.
(f) “COBRA” shall mean 29 U.S.C. §§ 1161-1168, as amended from time to time.
(g) “Death” shall mean a death that occurs other than by suicide.
(g) “Death” shall mean a death that occurs other than by suicide.
(h) “Disability” shall mean a medically determined physical or mental impairment which
qualifies the Employee for benefits under the Company’s long-term disability program, provided that
the Employee would be considered “disabled” under Treas. Reg. § 1.409A-3(i)(4). An Employee shall
not be deemed to have incurred a Disability until such benefits actually become payable (i.e.,
after any applicable waiting period). If the Company does not maintain a long-term disability
program, or if the Employee does not elect coverage under such program, Disability shall have the
meaning ascribed to it by Treas. Reg. § 1.409A-3(i)(4).
(i) “Good Reason” shall mean (i) a good faith determination by the Employee that the
Company or any of its officers has (A) taken any action which materially and adversely changes the
Employee’s position (including titles), authority or responsibilities with the Company or reduces
the Employee’s ability to carry out his duties and responsibilities with the Company or (B) has
failed to take any action where such failure results in material and adverse changes in the
Employee’s position (including titles), authority or responsibilities with the Company or reduces
the Employee’s ability to carry out his duties and responsibilities with the
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Company; (ii) a reduction in the Employee’s Base Salary or other forms of compensation (including,
without limitation, any equity compensation); or (iii) requiring the Employee to be employed at any
location more than 35 miles further from his principal residence than the location at which the
Employee was employed immediately preceding the Change of Control, in any case of (i), (ii) or
(iii) without the Employee’s prior written consent.
(j) “Incumbent Board” shall mean a member of the Board of Directors of the Corporation
who is not an Acquiring Person, or an affiliate (as defined in Rule 12b-2 of the Exchange Act) or
an associate (as defined in Rule 12b-2 of the Exchange Act) of an Acquiring Person, or a
representative or nominee of an Acquiring Person.
(k) “IRS” shall mean the United States Internal Revenue Service.
(l) “Perquisites” shall mean any perquisites provided to the Employee by the Company
at any time during the three-year period prior to the Employee’s termination of employment,
including, without limitation, personal use of a leased automobile, Company-paid country
club/dinner club dues, Company-paid airline club dues and Company-paid professional dues.
(m) “Term” shall mean the term of this Agreement as set forth in Section 2.
(n) “Welfare Benefits” shall mean all benefits provided by the Company to its
employees pursuant to an “employee welfare benefit plan” as defined in Section 3(1) of the Employee
Retirement Income Security Act of 1974, as amended.
2. Effective Date; Term. This Agreement shall be effective as of the Effective Date,
and shall remain in effect until the Employee’s employment with the Company ceases for any reason.
Notwithstanding this Section 2, the Company’s obligations under this Agreement shall survive the
termination of this Agreement if all events giving rise to such obligations (including, without
limitation, the Employee’s termination of employment under the circumstances described in Section
3(i), (ii) and (iii)) occurred prior to such termination.
3. Obligations of the Company upon Termination. If, during the two year period
following the effective date of a Change of Control, the Company terminates the Employee’s
employment other than for Cause or Disability, or the Employee terminates his employment for Good
Reason, or in the event of the Employee Death while in active employment with the Company, or if,
during the thirty day period following the two year anniversary of the effective date of a Change
of Control, the Employee terminates his employment for any reason, the Company shall pay the
compensation and provide the benefits described in this Section 3. Anything in this Agreement to
the contrary notwithstanding, if (i) a Change of Control occurs, (ii) the Employee’s employment
with the Company is terminated by the Company without Cause before the date on which the
consummation of the Change of Control occurred, and (iii) it is reasonably demonstrated by the
Employee that such termination of employment arose in connection with or in anticipation of a
transaction which, if consummated, would constitute a Change of Control (whether or not with
respect to the party first coming to the Company’s attention), then, for purposes of this Agreement
and
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notwithstanding any other action taken by the Company or the Employee (including execution of
a general release of claims), the Employee’s termination shall be deemed to have occurred with Good
Reason after consummation of a transaction constituting a Change of Control, and the Company shall
pay the compensation and provide the benefits described in this Section 3, subject to a credit for
the value of any other post-termination compensation and benefits paid to the Employee without
regard to the Employee’s rights under this Agreement.
(a) The Company shall pay to the Employee in a lump sum on the first day of the seventh month
beginning after Employee’s termination of employment:
(i) if not theretofore paid, an amount equal to any portion of the
Employee’s earned but unpaid Base Salary (including unused but accrued
vacation time) through the date of termination of employment; and
(ii) a cash amount equal to three times the sum of:
(A) the Employee’s annual Base Salary;
(B) the Employee’s Annual Bonus; and
(C) the aggregate value of the Employee’s Perquisites.
(b) The Company shall pay to the Employee a pro-rata portion of the target annual bonus (as
defined in this paragraph) with respect to the fiscal year in which the Employee’s employment
terminated, payable on the date that it would have otherwise been paid, but in no event later than
March 15th of the year following the year in which it otherwise would have been paid,
equal to the product of (i) the Employee’s target annual bonus (as defined in this paragraph) for
the full year multiplied by (ii) a fraction, the numerator of which is the number of days elapsed
from the beginning of the applicable fiscal year to the date of termination and the denominator of
which is 365. The target annual bonus is as set forth in the Corporation’s Executive Incentive Plan
and attached hereto as Exhibit A.
(c) The Company shall provide, for the period of three years following the date of Employee’s
termination of employment, all Welfare Benefits for the Employee and his dependents and
beneficiaries that are at least as favorable in all material respects as the benefits provided to
such person immediately preceding the Change of Control and to employees employed by the Company or
its successor in positions following the Change of Control that are similar to the position the
Employee held immediately prior to the Change of Control (“Similarly Situated Active Employees”);
provided, however, that, with respect to this Section 3(c), the Employee shall be required to pay
the same share of the cost of such Welfare Benefits as Similarly Situated Active Employees; and
provided further that if medical coverage provided to the Employee pursuant to this Section 3(c)
would expire later than the date upon which COBRA coverage for the Employee (determined without
regard to this Agreement) would expire (the “Normal COBRA Expiration Date”), continued medical
coverage provided to the Employee hereunder following the Normal COBRA Expiration Date shall be
subject to the reimbursement provisions of Section 9(c) of this Agreement. Notwithstanding
anything to the contrary set forth
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above, the Company, in its sole discretion, may discontinue any medical plan coverage contemplated
hereunder in the event that such continuation is not permitted under or would adversely affect the
tax status of the plan or plans of the Company pursuant to which the coverage is provided, in which
case the Company shall provide such coverage through insurance or other arrangements.
(d) The Company shall pay to the Employee in a lump sum within 15 days following Employee’s
termination of employment an amount equal to the sum of (i) matching contributions that the Company
would have made to the Company’s tax-qualified defined contribution plan on behalf of the Employee
had Employee remained an employee of the Company for the three-year period following the date of
Employee’s termination of employment assuming the Employee contributed to such plan as elective
deferral contributions the maximum amount permissible by applicable law and the terms of such plan,
and (ii) the additional amount the Employee would have received as a benefit under the Company’s
tax-qualified defined benefit pension plan had Employee remained an employee of the Company for the
three-year period following the date of Employee’s termination of employment. The amounts
described herein shall be determined under the terms of each respective plan as in effect
immediately prior to the effective date of the Change of Control.
(e) The Employee shall continue to be entitled to the rights and benefits described in (i)
Section 11 of the Company’s Amended and Restated Supplemental Excess Retirement Plan and (ii) the Company’s Amended and
Restated Stock-Based Award Plan and the award agreements entered into in connection with such
Stock-Based Award Plan.
(f) The Company shall provide the Employee with the same retiree medical benefits that were in
effect for retirees of the Company immediately prior to the Change of Control, based on the
Employee’s years of service, including service after the Change of Control; provided, however, that
if Employee is less than age 55 on the date of termination of employment, Employee shall be treated
for purposes of entitlement to such benefits as if he had attained age 55 prior to such
termination.
4. Certain Additional Payments by the Company.
(a) Anything in this Agreement to the contrary notwithstanding, in the event it shall be
determined that any payment or distribution by the Company to or for the benefit of the Employee,
or any benefit provided by the Company to the Employee (whether paid or payable or distributed or
distributable provided pursuant to the terms of this Agreement or otherwise, but determined without
regard to any additional payments required under this Section 4) (the “Total Payments”) would be
subject to the excise tax imposed by Section 4999 of the Code (or any successor provision) or any
interest or penalties are incurred by the Employee with respect to such excise tax (such excise
tax, together with any such interest and penalties, are hereinafter collectively referred to as the
“Excise Tax”), then the Employee shall be entitled to receive an additional payment (a “Gross-Up
Payment”) in an amount such that after payment by the Employee of all taxes with respect to the
Gross-Up Payment (including any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest and penalties imposed with
respect thereto) and Excise Tax imposed upon the Gross-Up
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Payment, the Employee retains an amount of the Gross-Up Payment equal to the Excise Tax imposed
upon the Payment.
(b) Notwithstanding anything in Section 4(a) to the contrary, the Gross-Up Payment shall only
be made to the Employee if the Total Payments exceed the maximum dollar amount that would be
payable to the Employee without application of the Excise Tax by more than fifty thousand dollars
($50,000.00). If the Total Payments exceed the maximum dollar amount that would be payable to the
Employee without application of the Excise Tax by an amount which is equal to or less than fifty
thousand dollars ($50,000.00), the Total Payments will be limited to the minimum extent necessary
to ensure that the Total Payments do not give rise to the Excise Tax.
(c) Subject to the provisions of Section 4(d), all determinations required to be made under
this Section 4, including whether and when a Gross-Up Payment is required and the amount of such
Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be
made by Ernst & Young or such other nationally recognized accounting firm then auditing the
accounts of the Company (the “Accounting Firm”) which shall provide detailed supporting
calculations both to the Company and the Employee within 15 business days of the receipt of notice
from the Employee that there has been a Payment, or such earlier time as is requested by the
Company. In the event that the Accounting Firm is serving as accountant or auditor for the
individual, entity or group effecting the Change of Control, or is unwilling or unable to perform
its obligations pursuant to this Section 4, the Employee shall appoint another nationally
recognized accounting firm to make the determinations required hereunder (which accounting firm
shall then be referred to as the Accounting Firm hereunder). All fees and expenses of the
Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment, determined pursuant to
this Section 4, shall be paid by the Company to the Employee within five days of the receipt of the
Accounting Firm’s determination, but in no event later than the latest date consistent with the
requirements of Treas. Reg. § 1.409A-3(i)(1)(v) (or any successor provision). Any determination by
the Accounting Firm shall be binding upon the Company and the Employee. As a result of the
potential uncertainty in the application of Section 4999 of the Code (or any successor provision)
at the time of the initial determination by the Accounting Firm hereunder, it is possible that
Gross-Up Payments which will not have been made by the Company should have been made
(“Underpayment”), consistent with the calculations required to be made hereunder. In the event
that the Company exhausts its remedies pursuant to Section 4(d) and the Employee thereafter is
required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the
Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to
or for the benefit of the Employee.
(d) The Employee shall notify the Company in writing of any claim by the IRS that, if
successful, would require the payment by the Company of the Gross-Up Payment. Such notification
shall be given as soon as practicable but no later than 20 business days after the Employee is
informed in writing of such claim and shall apprise the Company of the nature of such claim and the
date on which such claim is requested to be paid. The Employee shall not pay such claim prior to
the expiration of the 30-day period following the date on which he gives such notice to the Company
(or such shorter period ending on the date that any payment of taxes
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with respect to such claim is due). If the Company notifies the Employee in writing prior to
the expiration of such period that it desires to contest such claim, the Employee shall:
(i) give the Company any information reasonably requested by the Company
relating to such claim,
(ii) take such action in connection with contesting such claim as the
Company shall reasonably request in writing from time to time, including,
without limitation, accepting legal representation with respect to such
claim by an attorney reasonably selected by the Company,
(iii) cooperate with the Company in good faith in order effectively to
contest such claim, and
(iv) permit the Company to participate in any proceedings relating to
such claim;
provided, however, that the Company shall bear and pay directly all costs and expenses (including
additional interest and penalties) incurred in connection with such contest and shall indemnify and
hold the Employee harmless, on an after-tax basis, for any Excise Tax or income tax (including
interest and penalties with respect thereto) imposed as a result of such representation and payment
of costs and expenses. Without limiting the foregoing provisions of this Section 4(d), the Company
shall control all proceedings taken in connection with such contest and, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with the
taxing authority in respect of such claim and may, at its sole option, either direct the Employee
to pay the tax claimed and xxx for a refund or contest the claim in any permissible manner, and the
Employee agrees to prosecute such contest to a determination before any administrative tribunal, in
a court of initial jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that if the Company directs the Employee to pay such claim and xxx
for a refund, the Company shall advance the amount of such payment to the Employee, on an
interest-free basis, and shall indemnify and hold the Employee harmless, on an after-tax basis,
from any Excise Tax or income tax (including interest or penalties with respect thereto) imposed
with respect to such advance or with respect to any imputed income with respect to such advance;
and further provided that any extension of the statute of limitations relating to payment of taxes
for the taxable year of the Employee with respect to which such contested amount is claimed to be
due is limited solely to such contested amount. Furthermore, the Company’s control of the contest
shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and
the Employee shall be entitled to settle or contest, as the case may be, any other issue raised by
the IRS or any other taxing authority.
(e) If, after the receipt by the Employee of an amount advanced by the Company pursuant to
Section 4(d), the Employee becomes entitled to receive any refund with respect to such claim, the
Employee shall (subject to the Company’s complying with the requirements of Section 4(d)) promptly
pay to the
Company the amount of such refund (together with any interest paid or credited thereon after
taxes applicable thereto). If, after the receipt by
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the Employee of an amount advanced by the Company pursuant to Section 4(d), a determination is made
that the Employee shall not be entitled to any refund with respect to such claim and the Company
does not notify the Employee in writing of its intent to contest such denial of refund prior to the
expiration of 30 days after such determination, then such advance shall be forgiven and shall not
be required to be repaid and the amount of such advance shall offset, to the extent thereof, the
amount of Gross-Up Payment required to be paid.
5.
Other Compensation and Benefits. The amounts payable under this Agreement in
accordance with Sections 3(a), (b), (d), (e) and (f) shall not be reduced on account of any compensation received by the
Employee from other employment. From and after the date the Employee is employed by a third party
which provides any of the benefits described in Section 3(c), the Company shall not be obligated to
provide the benefits to the extent provided by such third party.
6. Legal Fees and Expenses. The Company shall promptly pay all reasonable legal fees
and expenses incurred by the Employee in connection with enforcing any right of the Employee
pursuant to and afforded by this Agreement upon submission by the Employee to the Company of an
invoice (or other similar document) that reasonably describes the fee or expense to be paid;
provided, however, that the Employee shall reimburse to the Company the amount of any such legal
fees and expenses paid by the Company if, in connection with enforcing any right of the Employee
pursuant to and afforded by this Agreement, a duly authorized court of law determines that the
Employee’s claim was frivolous.
7. Confidential Information. The Employee shall not, during the three-year period
following the termination of his employment, disclose any material secret or confidential
information, knowledge or data relating to the Company or any of its affiliated companies, and
their respective businesses, obtained by the Employee during his employment by the Company or any
of its affiliated companies and which is not otherwise public knowledge. In no event shall an
asserted violation of the provisions of this Section 7 constitute a basis for deferring or
withholding any amounts or benefits otherwise payable to the Employee under this Agreement.
8. Release from Other Severance Benefits; COBRA. This Agreement represents the
Employee’s exclusive right to severance benefits in the event of his termination of employment with
the Company on or after a Change of Control. The Employee hereby waives and releases the Company
from the obligation to pay any severance benefits to the Employee on account of a termination of
employment on or after a Change of Control, under any termination or severance policy of the
Company other than this Agreement. To the extent that the obligation of the Company to provide
medical benefits pursuant to Section 3(c) is fulfilled, the period in which such medical benefits
are provided shall be credited towards the continued health care coverage required to be offered to
the Employee by COBRA, to the extent allowable under COBRA and the regulations promulgated
thereunder. In the event that no payment or benefits are required pursuant to Sections 3(a) and
(c), the Employee rescinds any such waiver and release. Except for payments provided pursuant to
the Company’s formal severance policy, if any, the benefits and payments to be provided by this
Agreement will not reduce or eliminate any benefits or payments of any kind whatsoever that are to
be provided to the Employee,
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including but not limited to, under any vacation policy, defined benefit retirement plan, defined
contribution retirement plan, and the Company’s Supplemental Excess Retirement Plan.
9. Section 409A.
(a) Notwithstanding any other provision of this Agreement to the contrary, any payment or
benefit described in Section 3 that represents a “deferral of compensation” within the meaning of
Section 409A of the Internal Revenue Code of 1986, as amended from time to time (“Code”), and its
implementing regulations and guidance (“Section 409A”), shall only be paid or provided to the
Employee upon his termination of employment if such termination of employment is a “separation from
service” (as that term is defined in Treas. Reg. § 1.409A-1(h)). To the extent that the Employee’s
termination of employment is not such a “separation from service,” such payments will commence as
soon as a “separation from service” occurs.
(b) To the extent compliance with the requirements of Treas. Reg. § 1.409A-3(i)(2) (or any
successor provision) is necessary to avoid the application of an additional tax under Section 409A
to payments due the Employee upon or following his separation from service, then notwithstanding
any other provision of this Agreement (or any otherwise applicable plan, policy, agreement or
arrangement), any such payments that are otherwise due within six months following the Employee’s
termination of employment will be deferred (without interest) and paid to the Employee in a lump
sum immediately following that six month period. This provision shall not be construed as
preventing payments pursuant to Section 3 hereof provided such payments do not give rise to an
excise tax under Section 409A, in which case payment shall be made as otherwise contemplated by
Section 3.
(c) Notwithstanding anything herein to the contrary or otherwise, except to the extent any
expense, reimbursement or in-kind benefit provided pursuant to this Agreement does not constitute a
“deferral of compensation” within the meaning of Section 409A, (i) the amount of expenses eligible
for reimbursement or in-kind benefits provided to the Employee during any calendar year will not
affect the amount of expenses eligible for reimbursement or in-kind benefits provided to the
Employee in any other calendar year, (ii) the reimbursements for expenses for which the Employee is
entitled to be reimbursed shall be made on or before the last day of the calendar year following
the calendar year in which the applicable expense is incurred and (iii) the right to payment or
reimbursement or in-kind benefits hereunder may not be liquidated or exchanged for any other
benefit.
(d) Anything to the contrary herein notwithstanding, all benefits or payments provided by the
Company to the Employee that would be deemed to constitute “nonqualified deferred compensation”
within the meaning of Section 409A are intended to comply with Section 409A. If, however, any such
benefit or payment is deemed to not comply with Section 409A, the Company and the Employee agree to
renegotiate in good faith any such benefit or payment (including, without limitation, as to the
timing of any severance payments payable hereof) so that either (i) Section 409A will not apply or
(ii) compliance with Section 409A will be achieved.
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10. Successors.
(a) This Agreement is personal to the Employee and, without the prior written consent of the
Company, shall not be assignable by the Employee otherwise than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by the Employee’s
legal representatives. Notwithstanding anything herein to the contrary, the Employee may designate
a beneficiary to receive the benefits payable under this Agreement. Such beneficiary designation
must be made in writing and received by the Corporation’s Corporate Secretary prior to the
commencement of any payments under this Agreement.
(b) This Agreement shall inure to the benefit of and be binding upon the Company and its
successors. The Company shall cause any successor to its business, in any transaction in which
this Agreement would not be assumed by such successor by operation of law, to assume this Agreement
by contract.
11. Miscellaneous.
(a) Applicable Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of North Carolina, applied without reference to principles of conflict
of laws.
(b) Notices. All notices and other communications hereunder shall be in writing and
shall be given by hand delivery to the other party or by registered or certified mail, return
receipt requested, postage prepaid, or overnight delivery service requiring acknowledgement of
receipt, addressed as follows:
| If to the Employee: | ||||||
| If to the Company: | Xxxxxx Xxxxxxxx Materials, Inc. | |||||
| 0000 Xxxxxxx Xxxx | ||||||
| Xxxxxxx, Xxxxx Xxxxxxxx 00000 | ||||||
| Attention: Senior Vice President, General Counsel and Corporate Secretary |
or to such other address as either party shall have furnished to the other in writing in accordance
herewith. Notices and communications shall be effective when actually received by the addressee.
(c) Tax Withholding. The Company may withhold from any amounts payable under this
Agreement such Federal, state or local taxes as shall be required to be withheld pursuant to any
applicable law or regulation.
[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the Employee has hereunto set his hand and the Company has caused this
Agreement to be executed in its name on its behalf, as of the day and year first above written.
| XXXXXX XXXXXXXX MATERIALS, INC. |
||||
| By: | ||||
| Xxxxxxx X. Xxxxxx, Xx. | ||||
| Chairman and Chief Executive Officer | ||||
[SEAL] |
||||
| EMPLOYEE | ||||
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EXHIBIT A
TARGET ANNUAL BONUS
| RESPONSIBILITY LEVEL | TARGET INCENTIVE AWARD (% OF ANNUAL SALARY) |
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