1
EXHIBIT (10)(c)
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT is made and
entered into as of the 13th day of January, 1999, by and between LACLEDE STEEL
COMPANY, debtor in possession, a Delaware corporation ("Employer"), and XXXXXXX
X. XXXX ("Employee").
WHEREAS, Employee and Employer previously entered into an employment
agreement as of the 30th day of July, 1996 which was further amended on March
24, 1998 and July 29, 1998 (the "Original Employment Agreement"); and
WHEREAS, Employee and Employer desire to amend and restate the
Original Employment Agreement in its entirety, pursuant to this Amended and
Restated Employment Agreement; and
WHEREAS, Employee desires to be employed by Employer and
Employer desires to employ Employee under the terms and conditions set forth in
this Amended and Restated Employment Agreement; and
WHEREAS, it is Employer's intention to employ Employee upon
the terms and conditions herein, which recognize and compensate Employee for the
obligations of Employee undertaken hereunder, including specifically, but not by
way of limitation, the agreement of Employee not to compete with the business of
Employer, as provided in paragraph 9(b) (see page 8), for the period provided in
paragraph 9(a) upon the termination of Employee's employment by Employer for any
reason; it being understood and agreed that Employee is employed by Employer to
protect and expand the business of Employer;
NOW, THEREFORE, in consideration of the foregoing and the
promises and agreements herein contained, the parties agree as follows:
1. Employment. Employer hereby employs Employee, and
Employee hereby accepts such employment from Employer upon the terms and
conditions hereinafter set forth. This Amended and Restated Employment Agreement
supersedes the Original Employment Agreement.
2
2. Term of Employment. The term of Employee's employment
under this Agreement shall be for the period commencing January 13, 1999, and
continuing through December 31, 2000. Subsequent to such term this Agreement
shall continue in full force and effect until either party shall give ninety
(90) days written notice of termination, in which case this Agreement shall
terminate on the ninetieth (90th) day following the giving of such notice to the
other party. In addition, this Agreement shall terminate on the occurrence of
any of the following events:
(a) Whenever Employer and Employee shall mutually
agree in writing to terminate Employee's employment by Employer;
(b) Upon the death of Employee;
(c) For "cause," which shall mean Employee's
dishonesty or unlawful acts committed in connection with the business of
Employer, and which results in substantial gain or profit to Employee.
(d) At Employer's option and by action of Employer's
Board of Directors on thirty (30) days' written notice in the event of
Employee's Disability (defined as the failure substantially to discharge
Employee's duties as defined under this Agreement for ninety (90) consecutive
days or one hundred twenty (120) days (whether or not consecutive) in any twelve
(12) month period, as a result of an injury, disease, sickness or other physical
or mental incapacity). A determination of Employee's Disability shall be made by
a qualified medical doctor licensed to practice in the State of Missouri chosen
by Employer subject to Employee's approval, which approval shall not be
unreasonably withheld. Employee shall consent to be examined by Employer's
medical doctor and shall consent to allow Employee's medical doctor to discuss
Employee's medical condition with Employer. Notwithstanding anything to the
contrary contained herein, Employee's Disability shall not be deemed to have
commenced until full coverage with respect to such Disability shall have been
approved by Employer's disability insurance carrier and payment under Employer's
group disability policy for such Disability shall have commenced.
3. Title and Duties of Employee. Employee's title shall be
Executive Vice President and Chief Financial Officer. During Employee's
employment by Employer, Employee shall serve Employer to the best of Employee's
ability and shall perform such duties as are typically performed by the Chief
3
Financial Officer of Employer. Employee agrees to devote Employee's time and
efforts to the business of Employer (except for usual vacations and reasonable
time for attention to personal affairs so long as Employee's performance
hereunder is not adversely affected thereby), and to be loyal and faithful at
all times, constantly endeavoring to improve Employee's ability and knowledge of
the business of Employer in an effort to increase the value of Employee's
services for the mutual benefit of Employee and Employer.
4. Compensation and Benefits Other than Life Insurance.
(a) Employer agrees to pay Employee for Employee's
services during the term of Employee's employment hereunder. Employee's base
salary shall be the greater of (i) an annual rate of Two Hundred Forty-Three
Thousand Five Hundred Dollars ($243,500.00) or (ii) the highest annual base
salary authorized by the Board of Directors after the date hereof. Employee's
base salary shall be due and payable in twelve (12) equal monthly installments.
Additionally, during the term of Employee's employment by Employer hereunder,
Employee's compensation shall be reviewed and may be increased and/or Employee
may be paid additional or special compensation including without limitation
stock options, stock appreciation rights and other incentive compensation, or
bonuses (based on the earnings of Employer, the performance of Employee or
otherwise) from time to time by the mutual agreement of Employee and Employer,
as determined by the Board of Directors of Employer. In addition, during the
term of this Agreement, Employee shall receive such fringe benefits as are made
available by Employer from time to time to other employees of Employer at
Employee's level of employment; provided however, that benefits paid to Employee
in all events shall include Employee's leased automobile, Employee's tax
assistance program and Employee's health and disability insurance benefits.
(b) In the event of the termination of Employee's
employment either (i) by Employee for any reason including death or Disability,
or (ii) by Employer without "cause" (as defined in paragraph 2 herein), Employee
shall be paid incentive compensation for the fiscal year in which such
termination occurred in an amount equal to the product of (a) the amount of
incentive compensation to which he would have been entitled for such fiscal year
had there been no termination of employment and
4
(b) a fraction, the numerator of which is the number of days of such fiscal year
in which Employee remained in the employment of Employer and the denominator of
which is 365.
(c) After Employee's termination of employment
Employee shall participate in the Laclede Retired Salaried Employee Medical
Plan, as such plan may be amended by Employer or any replacement plan as may
exist from time to time.
(d) After Employee's termination of employment
medical benefits now payable for the benefit of Employee's dependent daughter,
Xxxxx Xxxx, under the Laclede Salaried Employee Medical Plan, as referenced in
the attached letter from General American Life Insurance Company, shall be
provided under the Laclede Retired Salaried Employee Medical Plan, as such plan
may be amended by Employer or any replacement plan as may exist from time to
time.
(e) Notwithstanding anything contained in Employee's
Key Employee Retirement Agreement with Employer (Employee's "KERP") or this
Agreement, Employer and Employee agree that on the first business day after
Employee ceases for any reason to be a full time employee of Employer
(Employee's "KERP Payment Date") Employer shall authorize in writing the Trustee
of Employee's KERP to pay to Employee in a lump sum in kind all amounts owed to
Employee pursuant to Employee's KERP. Until Employee's KERP Payment Date,
Employee shall be considered an active employee of Employer.
5. Severance Payment.
If (i) Employee remains in the employ of Employer
through December 31, 2000, (ii) Employer terminates Employee's employment
without cause (as defined in paragraph 2(c) herein), or (iii) Employer, without
Employee's written consent, reduces Employee's responsibility or changes
Employee's title, then in addition to all other amounts due Employee, whether
under this Agreement or otherwise, Employer shall pay to Employee as severance
in a lump sum an amount equal to Employee's annual base salary as defined in
paragraph 4(a) herein. Such amount shall be paid on Employee's last day of
employment with Employer.
6. Life Insurance Benefits.
(a) During the term of this Agreement, Employer shall
be obligated to keep in force life insurance on the life of Employee in the
amount of Six Hundred Thousand Dollars
5
($600,000.00) which will consist of permanent insurance on the life of Employee
owned by Employee or his designee.
(b) In the event of the termination of Employee's
employment either (i) by Employee for any reason, or (ii) by Employer without
"cause" (as defined in paragraph 2(c) herein), Employer agrees to keep in force
such permanent life insurance set forth in subparagraph (a) of this paragraph 6
for the duration of Employee's life. Employer may fulfill this obligation by
satisfying the premium requirement so that such permanent insurance is fully
paid under the terms of such permanent insurance policy. Employer's obligation
to pay permanent life insurance premiums under this subparagraph (b) will
survive the term of this Agreement.
(c) In the event of the termination of Employee's
employment by Employer for "cause" (as defined in paragraph 2(c) herein), then
Employer's obligation to pay premiums under this paragraph 6 will cease.
(d) Employer agrees to reimburse Employee for any tax
due on the annual permanent insurance premium paid by Employer.
(e) The amount of insurance described in subparagraph
(a) may be increased by the Board of Directors.
7. Termination. In the event of the termination of
Employee's employment by Employer, without "cause" (as defined in paragraph 2(c)
herein), then, in lieu of any further salary payment pursuant to paragraph 4(a)
herein, Employer agrees to pay Employee for the remaining term of this Agreement
at an annual rate equal to the average of Employee's "compensation" for the
three fiscal years preceding the year of such termination. For this purpose the
term "compensation" means Employee's base salary in effect for a particular year
plus the incentive compensation received by Employee with respect to services
rendered in such year whether or not such incentive compensation is actually
paid in such year. Amounts described above due Employee under this paragraph 7
shall be due and payable for the duration of the remaining term in equal monthly
installments. In addition to the foregoing, Employer shall continue, for the
duration of the remaining term, to provide Employee with such additional fringe
benefits to which Employee was entitled as of the day immediately prior to the
date of such termination. Nothing in this
6
paragraph 7 shall reduce or otherwise effect Employee's right to the benefits
set forth in paragraph 4(c), (d) and (e) herein and Employee's severance payment
set forth in paragraph 5 herein.
8. Extent of Services. Employee shall devote Employee's
time, attention and energy to the business of Employer, and shall not during the
term of this Agreement, or any extension hereof, without Employer's consent, be
engaged in any other business activity whether or not such business activity is
pursued for gain, profit or other pecuniary advantage; but nothing contained
herein shall be construed as preventing Employee from investing his assets in
such form or manner as will not require any service on the part of Employee in
the operation of the affairs of the corporations or other entities in which
Employee may invest his assets.
9. Covenants of Employee.
(a) During the term of Employee's employment with
Employer, and for a period of one (1) year after the termination of such
employment, for whatever reason, except for the termination of Employee's
employment under circumstances which constitute a violation by Employer of the
provisions of this Agreement, Employee covenants and agrees that Employee will
not (except as required in Employee's duties to Employer), in any manner
directly or indirectly:
(i) Disclose or divulge to any person, entity, firm or
company whatsoever, or use for Employee's own benefit or the benefit of any
other person, entity, firm or company directly or indirectly, in competition
with the business of Employer, as the same may exist at the date of such
cessation, any proprietary business methods, customer lists, supplier lists,
business plans or other information or data of Employer, without regard to
whether all of the foregoing matters will otherwise be deemed confidential,
material or important, the parties hereto stipulating that as between them, the
same are important, material and confidential and greatly affect the effective
and successful conduct of the business and the goodwill of Employer, and that
any breach of the terms of this subparagraph (i) shall be a material breach of
this Agreement;
(ii) Solicit, divert, take away or interfere with any
of the customers, trade, business, patronage, employees or agents of Employer;
7
(iii) Engage, directly or indirectly, either personally
or as an employee, partner, associate, officer, manager, agent, advisor,
consultant or otherwise, or by means of any corporate or other entity or device,
in any business competitive with the business of Employer.
(b) For purposes hereof, a business will be deemed
competitive if (i) such business involves the manufacture and sale of steel, or
any other business which is competitive, during or as of the date of cessation
of Employee's employment, with any business then being conducted by Employer or
as to which Employer has at such time formulated definitive plans to enter; and
(ii) such business makes substantial sales of products competitive with those of
Employer in any of the States of Missouri, Illinois, Indiana, Iowa, Michigan and
Ohio.
(c) All of the covenants on behalf of Employee
contained in this paragraph 0 shall be construed as agreements independent of
any other provision of this Agreement, and the existence of any claim or cause
of action against Employer, whether predicated on this Agreement or otherwise,
shall not constitute a defense to the enforcement by Employer of these
covenants.
(d) It is the intention of the parties to restrict the
activities of Employee under this paragraph 9 only to the extent necessary for
the protection of legitimate business interests of Employer, and the parties
specifically covenant and agree that should any of the clauses or provisions set
forth herein, under any set of circumstances not now foreseen by the parties, be
held by a court of competent jurisdiction to be illegal, invalid or
unenforceable under present or future laws effective during the term of this
Agreement, then and in that event, it is the intention of the parties hereto
that, in lieu of each such clause or provision of this paragraph 9, there shall
be substituted or added, and there is hereby substituted or added, terms to such
illegal, invalid or unenforceable clause or provision as may be legal, valid and
enforceable.
10. Expenses. In addition to compensation paid to Employee
under paragraph 4 hereof, during the period of Employee's employment, Employer
will pay directly or reimburse Employee for reasonable and necessary expenses
incurred by Employee in the interest of the business of Employer. All such
expenses paid by Employee will be reimbursed by Employer upon presentation by
Employee, from time to time, of an itemized account of such expenditures,
accompanied by appropriate receipts or other
8
evidence of payment to the extent necessary to permit the deductibility thereof
for Federal income tax purposes.
11. Documents. Employee agrees that all documents,
instruments, drawings, plans, contracts, proposals, records, notebooks,
invoices, statements and correspondence, including all copies thereof, relating
to the business of Employer, other than purely personal documents, shall be the
property of Employer; and upon the cessation of Employee's employment with
Employer, for whatever reason, all of the same then in Employee's possession,
whether prepared by Employee or others, will be left with or immediately
delivered to Employer.
12. Remedies. It is agreed that any material breach or
evasion of any of the terms of this Agreement by Employee will result in
immediate and irreparable injury to Employer and will authorize recourse to
injunction and/or specific performance as well as to all other legal or
equitable remedies to which Employer may be entitled. No remedy conferred by any
of the specific provisions of this Agreement is intended to be exclusive of any
other remedy, and each and every remedy shall be cumulative and shall be in
addition to every other remedy whether given hereunder or not or whether
hereafter existing at law or in equity, by statute or otherwise. The election of
any one or more remedies by Employer or Employee shall not constitute a waiver
of the right to pursue other available remedies at any time or cumulatively from
time-to-time.
13. Severability. All agreements and covenants herein
contained are severable, and in the event any of them shall be held to be
invalid or unenforceable by any court of competent jurisdiction, this Agreement
shall continue in full force and effect and, subject to paragraph 9(d) hereof,
shall be interpreted as if such invalid agreement or covenant were not contained
herein.
14. Waiver or Modification. No amendment, waiver or
modification of this Agreement or of any covenant, condition or limitation
herein contained shall be valid unless in writing and duly executed by the party
to be charged therewith, and no evidence of any amendment, waiver or
modification shall be offered or received in evidence in any proceeding,
arbitration or litigation between the parties hereto arising out of or affecting
this Agreement, or the rights or obligations of the parties hereunder, unless
such amendment, waiver or modification is in writing, duly executed as
aforesaid, and the parties further agree that the provisions of this paragraph
may not be waived or modified except as
9
herein set forth. Failure of Employee or Employer to exercise or otherwise act
with respect to any rights granted hereunder in the event of a breach of any of
the terms or conditions hereof by the other party, shall not be construed as a
waiver of such breach, nor prevent Employee or Employer from thereafter
enforcing strict compliance with any and all of the terms and conditions hereof.
15. Fees and Expenses. If Employee is the prevailing party,
Employer shall pay all of Employee's reasonable legal fees and related expenses
(including the costs of experts, evidence and counsel) incurred by Employee as a
result of (i) Employee's termination of employment (including all such fees and
expenses, if any, incurred in contesting or disputing any such termination of
employment) or (ii) Employee's seeking to obtain or enforce any right or benefit
provided by this Agreement or by any other plan or arrangement maintained by
Employer under which Employee is or may be entitled to receive benefits.
16. Notices. All notices, requests, demands or other
communications hereunder ("Notice") shall be in writing and shall be given by
registered or certified mail, return receipt requested:
if to Employer to:
Laclede Steel Company
Attn: Xxxxxx X. Xxxx, Xx.
President
00xx Xxxxx
Xxx Xxxxxxxxxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
and, if to Employee, to:
Xxxxxxx X. Xxxx
0000 Xxxxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
or to such other addresses as to which the parties hereto give Notice in
accordance with this paragraph 16.
16. Construction. This Agreement shall be governed by and
construed and interpreted according to the laws of the State of Missouri,
notwithstanding the place of execution hereof, nor the performance of any acts
in connection herewith or hereunder in any other jurisdiction. For all purposes
hereof, reference to Employer shall include each and every subsidiary and
affiliated company of Employer.
10
17. Assignability. The services to be performed by Employee
hereunder are personal in nature and therefore Employee shall not assign his
rights or delegate his obligations under this Agreement, and any attempted or
purported assignment or delegation not herein permitted shall be null and void.
18. Successors. Subject to the provisions of paragraph 9,
this Agreement shall be binding upon and shall inure to the benefit of
Employer and Employee and their respective heirs, executors, administrators,
legal representatives, successors and assigns.
19. Prior Employment Agreements. Any prior Employment
Agreement between Employer and Employee is hereby terminated by mutual
agreement.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
------------------------------
XXXXXXX X. XXXX
"Employee"
LACLEDE STEEL COMPANY
By____________________________
Xxxxxx X. Xxxx, Xx, President
"Employer"
