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EXHIBIT 10(s)
THIS AGREEMENT made effective the 1st day of January, 1997.
BETWEEN:
POTASH CORPORATION OF SASKATCHEWAN INC.
(hereinafter referred to as "the Corporation")
OF THE FIRST PART
AND:
XXXXXXX X. XXXXXXXX
(hereinafter referred to as "Childers")
OF THE SECOND PART
WHEREAS, Potash Corporation of Saskatchewan ("PCS") and Childers entered into an
Employment Agreement ("the Employment Agreement") dated the 1st day of July,
1989;
AND WHEREAS, PCS and the Corporation entered into an Agreement for the Transfer
of Employees of Potash Corporation of Saskatchewan on the 31st day of October,
A.D. 1989;
AND WHEREAS, the Corporation has assumed the obligations of PCS with respect to
the Employment Agreement effective October 31, 1989;
AND WHEREAS, the Corporation and Childers have agreed to certain amendments to
the Employment Agreement and wish in this Agreement to restate the Employment
Agreement;
NOW THEREFORE, this Agreement WITNESSETH that in consideration of the mutual
covenants the parties hereto agree as follows:
1. POSITION OF EMPLOYMENT
The Corporation hereby continues the employment of Childers in
positions of President and Chief Executive Officer, under the direction
of its Board of Directors, and the position of Chairman of the Board of
Directors and Childers hereby agrees to the extension of the foregoing
employment.
2. TERM OF AGREEMENT
The term of this Agreement shall be to June 30, 2002. Childers shall be
the Chairman of the Board of Directors and Chief Executive Officer of
the Corporation to June 30, 1999. For the period July 1, 1999 to June
30, 2002 Childers shall be the Chairman of the Board of Directors and,
subject to the provisions of paragraph 16 hereof, serve as a special
advisor to the Corporation. From and after July 1, 1999 Childers shall
be deemed to have retired from active employment with the Corporation
and shall be entitled to retirement benefits thereafter.
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3. SALARY AND COMPENSATION
The Corporation agrees to pay Childers for all of the services rendered
by him hereunder and Childers agrees to accept as compensation therefor
the following (all of which amounts are expressed in United States
dollars):
a. While Childers holds the position of Chairman and Chief
Executive Officer a basic salary payable monthly, subject to
all required and proper deductions, as follows:
i. for the period January 1, 1997 to December 31, 1997
the sum of one million, one hundred thousand
($1,100,000) dollars;
ii. for the period January 1, 1998 to December 31, 1998
the sum of one million, two hundred thousand
($1,200,000) dollars;
iii. for the period January 1, 1999 to June 30, 1999 the
sum of six hundred and fifty thousand ($650,000)
dollars.
b. In addition to the amounts payable to Childers under this
Agreement or under any other benefit plan or program, while
Childers holds the position of Chairman and Chief Executive
Officer, an amount equal to any amount paid to Childers
pursuant to the Corporation's Short Term Incentive Plan.
c. After Childers ceases to hold the position of Chief Executive
Officer, he shall be paid the sum of three hundred thousand
($300,000) dollars less any amount paid to Childers for his
role as Chairman and Director as an annual retainer payable
monthly subject to all required and proper deductions.
4. DUTIES OF EMPLOYEE
It shall be Childers' responsibility to faithfully and competently
perform all of the services ordinarily required of a Chief Executive
Officer of a major corporation such as that of the Corporation. It
shall be Childers' responsibility to direct all aspects of the
operation of the Corporation. It shall be Childers' responsibility as
Chairman to preside at Board Meetings and carry out those functions as
are authorized by the bylaws of the Corporation. Upon assuming the
responsibility as a special advisor to the Corporation it shall be
Childers' responsibility to assist in customer and public relations,
and act as a representative at industry association meetings and
conventions including those of The Fertilizer Institute, International
Fertilizer Association and the Potash and Phosphate Institute.
5. EXPENSES
The Corporation agrees to pay to Childers all reasonable expenses
incurred by Childers in the performance of his duties. The Corporation
recognizes the contribution of Xxxxx Xxxxxxxx to the Corporation and
agrees that expenses incurred by Xxxxx Xxxxxxxx for travel and
accommodation to any meeting relating to the Corporation shall be paid
by the Corporation.
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6. INCOME TAX COMPENSATION
The Corporation acknowledges that Childers may be subject to a higher
rate of income taxation in Canada on income earned by Childers while
resident in Canada than Childers would be liable to pay if he resided
in the United States and earned an equivalent amount of income there.
The Corporation further acknowledges that the parties intend that
Childers' after tax position pursuant to the terms of this Agreement
based on the income earned by Childers shall be no different than if he
resided in the United States and earned an equivalent amount of income
in that country. Accordingly, the parties agree that a firm of
Chartered Accountants, mutually agreed upon by the parties, shall, on
an annual basis, complete the necessary calculations to determine the
income tax payable by Childers in Canada and in the United States as if
he had continued to reside in the State of Illinois. In the event that
the first amount (i.e., federal and provincial tax payable in Canada)
exceeds the second amount (i.e., projected federal and state tax
payable in the United States) the Corporation shall pay Childers an
amount, to be determined by such Chartered Accountants, such that
Childers' aggregate income on an after-tax basis would be equal to that
which he would have earned had he been a resident of the State of
Illinois during the entire taxable year.
7. CORPORATION'S DISABILITY, RETIREMENT AND PENSION PLAN
a) Childers shall be entitled to participate in the benefits plan
which are currently available to senior executives of the
Corporation. Upon termination of employment the Corporation
agrees to provide a comprehensive medical, vision, and dental
insurance plan for Childers equivalent to the medical, vision,
and dental plan currently in existence (a description of which
plan is set forth in Schedule I attached hereto) which plan
shall remain in effect for the lifetime of Childers. The
commitment to provide medical, vision, and dental insurance
shall survive this Agreement.
b) Both parties hereto acknowledge and agree that, effective July
1, 1999 and not withstanding Childers continued provision of
services to the Corporation in his role of Chairman of the
Board and special advisor, Childers shall be deemed to have
retired from employment with the Corporation.
8. EXECUTIVE BONUS PROGRAM
For so long as he serves as Chief Executive Officer, Childers shall be
entitled to receive in addition to compensation provided for in this
Agreement, additional compensation as is provided for in Schedule II
attached hereto and forming part of this Agreement.
9. CORPORATE AIRCRAFT
The Corporation, in recognition of the importance to it of Childers'
security, safety and efficient use of time, authorizes and expects
Childers to use the principal corporate aircraft for all business and
personal travel. The Corporation hereby agrees to indemnify Childers
for any and all income taxes payable by him resulting from travel on
such aircraft by him or members of his family who may accompany him.
Furthermore, the Corporation hereby agrees to compensate Childers for
any
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additional income taxes he may incur as a result of any indemnity
payments for income taxes incurred from his use of such aircraft or for
any compensating payments for additional taxes incurred on a
compensating payment.
10. DEATH OR DISABILITY OF EMPLOYEE
If, prior to July 1, 1999, Childers becomes physically or mentally
incapable of performing the services required of him and such
incapacity is or may reasonably be expected to exist for more than four
months, or Childers dies, then Childers or his estate shall be entitled
to receive and be paid compensation up to and including June 30, 1999
as if he had not been disabled or died, less any amounts of disability
benefits that are available to Childers or his estate that have been
provided by the Corporation.
11. TERMINATION
In the event that the Corporation shall terminate this Agreement for
any reason or under circumstances other than for cause, the Corporation
shall pay to Childers at the time of such termination all sums,
including salaries, bonuses and income tax compensation, that would
have been paid to Childers pursuant to this Agreement had this
Agreement remained in full force and effect from the date of
termination to the end of the term of this Agreement.
12. VOLUNTARY RESIGNATION
In the event that Childers shall voluntarily resign during the term of
this Agreement or any renewal hereof, the Corporation shall pay to
Childers at the time of such resignation the total of all salaries and
bonuses earned by Childers to the date of such termination plus the
income tax compensation with respect to those salaries and bonuses.
13. TERMINATION FOR CAUSE
The Corporation shall be entitled to terminate the services of Childers
in the event of the infidelity of Childers to the Corporation. For the
purposes of this provision, "infidelity" shall be defined as including
any illegal act by Childers in relation to the property of the
Corporation whereby Childers achieves a personal gain therefrom. In the
event that the Corporation shall terminate the services of Childers
pursuant to this provision, the Corporation shall pay to Childers at
the time of such termination all salaries and bonuses earned by
Childers to the date of such termination plus the income tax
compensation with respect to those salaries and bonuses.
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14. BENEFITS PAYABLE UPON TERMINATION
Upon termination of this Agreement for any reason including the expiry
of the term, the Corporation agrees that it shall reimburse Childers
for all reasonable moving expenses incurred by Childers. The
Corporation agrees that Childers shall be entitled to participate in
the Corporation's "home purchase plan" that is available to senior
employees that are transferred.
15. MERGER, TAKE-OVER OR SALE OF THE CORPORATION
The Corporation agrees that in the event the undertaking of the
Corporation is sold, dissolved, merged or amalgamated, the Corporation
shall ensure that Childers shall retain his positions of the successor
Corporation or business and on the same terms and conditions as
contained in this Agreement or, in the alternative, the Corporation
shall compensate Childers in the same manner as provided for in
paragraph 11 hereof.
16. SUBSEQUENT AGREEMENTS
The parties hereto acknowledge that, from and after July 1, 1999,
Childers may enter into an agreement to act as special advisor to one
or more of the Corporation's direct or indirect subsidiaries. The
parties hereto agree that, in the event such agreement is entered into,
the respective obligations of Childers and the Corporation relating to
Childers' role as special advisor to the Corporation under this
agreement shall be of no force and effect, including but not limited to
the Corporation's obligation to Childers under paragraph 3(c) hereof.
17. SOLE AGREEMENT
Upon the entering into this Agreement by both parties any previous
contracts of employment between the parties are terminated and no
longer have any force and effect.
IN WITNESS WHEREOF the Corporation has caused this Agreement to be duly executed
and made effective the day and year first above written.
POTASH CORPORATION OF SASKATCHEWAN INC.
By: /s/
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IN WITNESS WHEREOF XXXXXXX X. XXXXXXXX has executed this Agreement effective the
day and year first above written.
SIGNED, SEALED AND DELIVERED )
)
in the presence of: )
)
/s/ ) /s/
-------------------------------- ) ---------------------------------
Witness XXXXXXX X. XXXXXXXX
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SCHEDULE I
Medical
- No deductible
- 100% payment of medical expenses
- Eligible expenses include private hospital, prescription drugs,
paramedical treatment
- Maximum -- unlimited
Visioncare
- No deductible
- 100% payment of vision expenses
- Eligible expenses include eyeglass and frame amounts and contact
lens amounts. Eye examinations also included
- Maximum -- unlimited
Dental
- No deductible
- 100% of dental expenses
- Dental expenses include diagnostic and preventive services, basic
and major services, restorative treatment and orthodontic
treatment
- Unlimited maximum effective January 1, 1989
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SCHEDULE II
Childers shall be entitled to participate in executive bonus programs generally
available to senior executives of the Corporation subject to the following
special provisions:
a. Short-term Incentive Compensation Plan (STIP)
The provisions of the STIP shall apply to Childers except that
Childers' Award Percentage at:
i. Target XXX shall be 50%;
ii. Threshold XXX shall be 25%;
iii. Maximum XXX shall be 100%.
b. Long-term Incentive Plan (LTIP)
In addition to any Units granted to Childers prior to the date of this
Agreement, and notwithstanding any provision of the LTIP to the
contrary, the following grant of Units is made to Childers:
Grant Date: January 1, 1995
Target Bonus: 50% of Salary
Number of Part I Units: 10,300
Number of Part II Units: 10,300
Redemption Date Part I Units: On or before December 31, 1997 on a date
determined by the Compensation Committee.
Redemption Date Part II Units: One third shall be redeemed on or before
December 31, 1995; December 31, 1996;
December 31, 1997, on a date to be
determined by the Compensation Committee.
Subject to the above, the provisions of the LTIP shall apply, with
necessary changes in points of detail, to the foregoing grant of Units
to Childers.
Nothing contained in this Schedule shall affect Childers right to participate in
any corporate benefit plan not referenced in this Schedule II.
