CHANGE OF CONTROL AGREEMENT
This Change of Control Agreement ("the Agreement") between Avondale
Industries, Inc., a Louisiana corporation (the "Company"), and ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇ (the "Employee") is dated effective as of March 23, 1998 (the
"Change of Control Agreement Date").
ARTICLE I
DEFINITIONS
1.1 EMPLOYMENT AGREEMENT DEFINED. Notwithstanding any provision
thereof, after a Change of Control (defined below), this Agreement
supersedes the Employment Agreement dated as of March 23, 1998 or any
subsequent employment agreement between Employee and the Company that so
provides (the "Employment Agreement").
1.2 COMPANY DEFINED. As used in this Agreement, "Company" shall mean
the Company as defined above and any successor to or assignee of (whether
direct or indirect, by purchase, merger, consolidation or otherwise) all or
substantially all of the assets or business of the Company.
1.3 CHANGE OF CONTROL DEFINED. "Change of Control" shall mean:
(a) 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 of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of more than 25% of the
outstanding shares of the Company's Common Stock, $1.00 par value per
share (the "Common Stock"); provided, however, that for purposes of
this subsection (a), the following acquisitions shall not constitute a
Change of Control:
(i) any acquisition of Common Stock directly from the
Company,
(ii) any acquisition of Common Stock by the Company,
(iii) any acquisition of Common Stock by any employee
benefit plan (or related trust) sponsored or maintained by the
Company or any corporation controlled by the Company, or
(iv) any acquisition of Common Stock by any corporation
pursuant to a transaction that complies with clauses (i), (ii)
and (iii) of subsection (c) of this Section 1.3; or
(b) individuals who, as of the Change of Control Agreement Date,
constitute the Board (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board; provided, however, that
any individual becoming a director subsequent to the Change of Control
Agreement Date whose election, or nomination for election by the
Company's shareholders, was approved by a vote of at least a majority
of the directors then comprising the Incumbent Board shall be
considered a member of the Incumbent Board, unless such individual's
initial assumption of office occurs as a result of an actual or
threatened election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a person other than the Incumbent Board;
or
(c) consummation of a reorganization, merger or consolidation, or
sale or other disposition of all of substantially all of the assets of
the Company (a "Business Combination"), in each case, unless,
following such Business Combination,
(i) all or substantially all of the individuals and entities
who were the beneficial owners of the Company's outstanding
common stock and the Company's voting securities entitled to vote
generally in the election of directors immediately prior to such
Business Combination have direct or indirect beneficial
ownership, respectively, of more than 50% of the then outstanding
shares of common stock, and more than 50% of the combined voting
power of the then outstanding voting securities entitled to vote
generally in the election of directors, of the corporation
resulting from such Business Combination (which, for purposes of
this paragraph (i) and paragraphs (ii) and (iii), shall include a
corporation which as a result of such transaction controls the
Company or all or substantially all of the Company's assets
either directly or through one or more subsidiaries), and
(ii) except to the extent that such ownership existed prior
to the Business Combination, no person (excluding any corporation
resulting from such Business Combination or any employee benefit
plan or related trust of the Company or such corporation
resulting from such Business Combination) beneficially owns,
directly or indirectly, 20% or more of the then outstanding
shares of common stock of the corporation resulting from such
Business Combination or 20% or more of the combined voting power
of the then outstanding voting securities of such corporation,
and
(iii) 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
(d) approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company.
1.4 AFFILIATE DEFINED. "Affiliate" or "affiliated companies" shall
mean any company controlled by, controlling, or under common control with,
the Company.
1.5 CAUSE DEFINED. "Cause" shall mean:
(a) the willful and continued failure of the Employee to
perform substantially the Employee's duties with the Company or
its affiliates (other than any such failure resulting from
incapacity due to physical or mental illness), after a written
demand for substantial performance is delivered to the Employee
by the Board of the Company which specifically identifies the
manner in which the Board believes that the Employee has not
substantially performed the Employee's duties, or
(b) the willful engaging by the Employee in illegal conduct
or gross misconduct.
For purposes of this provision, no act or failure to act, on the part of
the Employee, shall be considered "willful" unless it is done, or omitted
to be done, by the Employee in bad faith or without reasonable belief that
the Employee's action or omission was in the best interests of the Company
or its Affiliates. Any act, or failure to act, based upon authority given
pursuant to a resolution duly adopted by the Board or upon the instructions
of a senior officer of the Company or based upon the advice of counsel for
the Company or its Affiliates shall be conclusively presumed to be done, or
omitted to be done, by the Employee in good faith and in the best interests
of the Company or its Affiliates. The cessation of employment of the
Employee shall not be deemed to be for Cause unless and until there shall
have been delivered to the Employee a copy of a resolution duly adopted by
the affirmative vote of not less than three-quarters of the entire
membership of the Board at a meeting of the Board called and held for such
purpose (after reasonable notice is provided to the Employee and the
Employee is given an opportunity, together with counsel, to be heard before
the Board), finding that, in the good faith opinion of the Board, the
Employee is guilty of the conduct described in subparagraph (a) or (b)
above, and specifying the particulars thereof in detail.
1.6 DISABILITY DEFINED. "Disability" shall mean a condition that
would entitle the Employee to receive benefits under the Company's long-
term disability insurance policy in effect at the time either because he is
Totally Disabled or Partially Disabled, as such terms are defined in the
Company's policy in effect as of the date of this Agreement or as similar
terms are defined in any successor policy. If the Company has no long-term
disability plan in effect, "Disability" shall occur if (a) the Employee is
rendered incapable because of physical or mental illness of satisfactorily
discharging his duties and responsibilities to the Company for a period of
90 consecutive days, (b) a duly qualified physician chosen by the Company
and acceptable to the Employee or his legal representatives so certifies in
writing, and (c) the Board determines that the Employee has become
disabled.
1.7 GOOD REASON DEFINED. "Good Reason" shall mean:
(a) Any failure of the Company or its Affiliates to provide the
Employee with the position, authority, duties and responsibilities at
least commensurate in all material respects with the most significant
of those held, exercised and assigned at any time during the 120-day
period immediately preceding the Change of Control. Employee's
position, authority, duties and responsibilities after a Change of
Control shall not be considered commensurate in all material respects
with Employee's position, authority, duties and responsibilities prior
to a Change of Control unless after the Change of Control Employee
holds (i) an equivalent position in the Company or, (ii) if the
Company is controlled or will after the transaction be controlled by
another company (directly or indirectly), an equivalent position in
the ultimate parent company.
(b) The assignment to the Employee of any duties inconsistent in
any material respect with Employee's position (including status,
offices, titles and reporting requirements), authority, duties or
responsibilities as contemplated by Section 2.1(b) of this Agreement,
or any other action that results in a diminution in such position,
authority, duties or responsibilities, excluding for this purpose an
isolated, insubstantial and inadvertent action not taken in bad faith
that is remedied within 10 days after receipt of written notice
thereof from the Employee to the Company;
(c) Any failure by the Company or its Affiliates to comply with
any of the provisions of this Agreement, other than an isolated,
insubstantial and inadvertent failure not occurring in bad faith that
is remedied within 10 days after receipt of written notice thereof
from the Employee to the Company;
(d) The Company or its Affiliates requiring the Employee to be
based at any office or location other than as provided in Section
2.1(b)(ii) hereof or requiring the Employee to travel on business to a
substantially greater extent than required immediately prior to the
Change of Control;
(e) Any purported termination of the Employee's employment
otherwise than as expressly permitted by this Agreement; or
(f) Any failure by the Company to comply with and satisfy
Sections 3.1(c) and (d) of this Agreement.
ARTICLE II
CHANGE OF CONTROL BENEFIT
2.1 EMPLOYMENT TERM AND CAPACITY AFTER CHANGE OF CONTROL. (a) If a
Change of Control occurs on or before December 31, 2000, then the
Employee's employment term (the "Employment Term") shall continue through
the third anniversary of the Change of Control, subject to any earlier
termination of Employee's status as an employee pursuant to this Agreement.
(b) After a Change of Control and during the Employment Term, (i) the
Employee's position (including status, offices, titles and reporting
requirements), authority, duties and responsibilities shall be at least
commensurate in all material respects with the most significant of those
held, exercised and assigned at any time during the 120-day period
immediately preceding the Change of Control and (ii) the Employee's service
shall be performed during normal business hours at the location where the
Employee was employed immediately preceding the Change of Control or any
office or location less than 35 miles from such location. Employee's
position, authority, duties and responsibilities after a Change of Control
shall not be considered commensurate in all material respects with
Employee's position, authority, duties and responsibilities prior to a
Change of Control unless after the Change of Control Employee holds (x) an
equivalent position in the Company or, (y) if the Company is controlled or
will after the transaction be controlled by another company (directly or
indirectly), an equivalent position in the ultimate parent company.
Employee shall devote himself to his employment responsibilities with the
Company (or, if applicable, the ultimate parent entity) as provided in the
Employment Agreement.
2.2 COMPENSATION AND BENEFITS. During the Employment Term, Employee
shall be entitled to the following compensation and benefits:
(a) BASE SALARY. The Employee shall receive an annual base
salary ("Base Salary"), which shall be paid at a monthly rate, at
least equal to 12 times the highest monthly base salary paid or
payable, including any base salary which has been earned but deferred
by the Employee, by the Company and its affiliated companies in
respect of the 12-month period immediately preceding the month in
which the Change of Control occurs. During the Employment Term, the
Base Salary shall be reviewed no more than 12 months after the last
salary increase awarded to the Employee prior to the Change of Control
and thereafter at least annually and shall be first increased no more
than 12 months after the last salary increase awarded to the Employee
prior to the Change of Control and thereafter at least annually in an
amount equal to the percentage increase (excluding promotional
increases) in base salary generally awarded to peer executives of the
Company and its affiliated companies for the year of determination.
Any increase in Base Salary shall not serve to limit or reduce any
other obligation to the Employee under this Agreement. Base Salary
shall not be reduced after any such increase and the term Base Salary
as utilized in this Agreement shall refer to Base Salary as so
increased.
(b) ANNUAL BONUS. In addition to Base Salary, the Employee shall
be awarded, for each fiscal year ending during the Employment Term, an
annual bonus (the "Bonus") in cash at least equal to the executive's
target bonus under the Company's Management Incentive Plan, or any
comparable bonus under a successor plan, for the last full fiscal year
prior to the Change of Control. Each such Bonus shall be paid no
later than the end of the third month of the fiscal year next
following the fiscal year for which the Bonus is awarded, unless the
Employee shall elect to defer the receipt of such Bonus.
(c) FRINGE BENEFITS. The Employee shall be entitled to fringe
benefits (including, but not limited to, automobile allowance,
reimbursement for membership dues, and first class air travel) in
accordance with the most favorable agreements, plans, practices,
programs and policies of the Company and its affiliated companies in
effect for the Employee at any time during the 120-day period
immediately preceding the Change of Control or, if more favorable to
the Employee, as in effect generally at any time thereafter with
respect to other peer employees of the Company and its affiliated
companies.
(d) EXPENSES. The Employee shall be entitled to receive prompt
reimbursement for all reasonable expenses incurred by the Employee in
accordance with the most favorable agreements, policies, practices and
procedures of the Company and its affiliated companies in effect for
the Employee at any time during the 120-day period immediately
preceding the Change of Control or, if more favorable to the Employee,
as in effect generally at any time thereafter with respect to other
peer employees of the Company and its affiliated companies.
(e) INCENTIVE, SAVINGS AND RETIREMENT PLANS. The Employee shall
be entitled to participate in all incentive, savings and retirement
plans, practices, policies and programs applicable generally to other
peer employees of the Company and its affiliated companies, but in no
event shall such plans, practices, policies and programs provide the
Employee with incentive opportunities (measured with respect to both
regular and special incentive opportunities, to the extent, if any,
that such distinction is applicable), savings opportunities and
retirement benefit opportunities, in each case, less favorable than
the most favorable of those provided by the Company and its affiliated
companies for the Employee under any agreements, plans, practices,
policies and programs as in effect at any time during the 120-day
period immediately preceding the Change of Control or, if more
favorable to the Employee, those provided generally at any time after
the Change of Control to other peer employees of the Company and its
affiliated companies.
(f) WELFARE BENEFIT PLANS. The Employee and/or the Employee's
family, as the case may be, shall be eligible for participation in and
shall receive all benefits under welfare benefit plans, practices,
policies and programs provided by the Company and its affiliated
companies (including, without limitation, medical, prescription,
dental, disability, employee life, group life, accidental death and
travel accident insurance plans and programs) to the extent applicable
generally to other peer employees of the Company and its affiliated
companies, but in no event shall such plans, practices, policies and
programs provide the Employee with benefits, in each case, less
favorable than the most favorable of any agreements, plans, practices,
policies and programs in effect for the Employee at any time during
the 120-day period immediately preceding the Change of Control or, if
more favorable to the Employee, those provided generally at any time
after the Change of Control to other peer employees of the Company and
its affiliated companies.
(g) OFFICE AND SUPPORT STAFF. The Employee shall be entitled to
an office or offices of a size and with furnishings and other
appointments, and to exclusive personal secretarial and other
assistance, at least equal to the most favorable of the foregoing
provided to the Employee by the Company and its affiliated companies
at any time during the 120-day period immediately preceding the Change
of Control or, if more favorable to the Employee, as provided
generally at any time thereafter with respect to other peer employees
of the Company and its affiliated companies.
(h) VACATION. The Employee shall be entitled to paid vacation in
accordance with the most favorable agreements, plans, policies,
programs and practices of the Company and its affiliated companies as
in effect for the Employee at any time during the 120-day period
immediately preceding the Change of Control or, if more favorable to
the Employee, as in effect generally at any time thereafter with
respect to other peer employees of the Company and its affiliated
companies.
2.3 OBLIGATIONS UPON TERMINATION AFTER A CHANGE OF CONTROL.
(a) TERMINATION BY COMPANY FOR REASONS OTHER THAN DEATH,
DISABILITY OR CAUSE OR BY EMPLOYEE FOR GOOD REASON. If, after a
Change of Control and during the Employment Term, the Company
terminates the Employee's employment other than for Cause, death or
Disability, or the Employee terminates employment for Good Reason,
(i) the Company shall pay to the Employee in a lump sum in
cash within 30 days of the date of termination an amount equal to
three times the sum of (i) the amount of Base Salary in effect at
the date of termination, plus (ii) the greater of (x) the highest
annual Bonus paid or to be paid to the Employee with respect to
the last three fiscal years or (y) the target Bonus for which the
Employee is eligible for the 12-month period in which the date of
termination occurs;
(ii) for a period of thirty-six (36) months following the
date of termination of employment (the "Continuation Period"),
the Company shall at its expense continue on behalf of the
Employee and his dependents and beneficiaries the life insurance,
disability, medical, dental and hospitalization benefits provided
(x) to the Employee at any time during the 90-day period prior to
the Change in Control or at any time thereafter or (y) to other
similarly situated executives who continue in the employ of the
Company during the Continuation Period. The coverage and benefits
(including deductibles and costs) provided in this Section
2.3(a)(ii) during the Continuation Period shall be no less
favorable to the Employee and his dependents and beneficiaries,
than the most favorable of such coverages and benefits during any
of the periods referred to in clauses (x) or (y) above. The
Company's obligation hereunder with respect to the foregoing
benefits shall be limited to the extent that the Employee obtains
any such benefits pursuant to a subsequent employer's benefit
plans, in which case the Company may reduce the coverage of any
benefits it is required to provide the Employee hereunder as long
as the aggregate coverages and benefits of the combined benefit
plans is no less favorable to the Employee than the coverages and
benefits required to be provided hereunder. The Employee will be
eligible for coverage under the Consolidated Omnibus Budget
Reconciliation Act at the end of the Continuation Period or
earlier cessation of the Company's obligation hereunder.
(iii) the Employee shall immediately become fully (100%)
vested in his benefit under each supplemental or excess
retirement plan of the Company in which the Employee was a
participant, including, but not limited to the Avondale
Industries, Inc. Supplemental Pension Plan and the Avondale
Industries, Inc. Executive Excess Retirement Plan and any
successor plans;
(iv) notwithstanding any plan provision regarding the
payment of benefits following a change of control of the Company
which shall be superseded hereby, the Company shall pay to the
Employee in a lump sum in cash within 30 days of the date of
termination an amount equal to the then present value of the
actuarial equivalent of the additional benefits, if any, to which
the Employee would be entitled under the Avondale Industries,
Inc. Pension Plan, and any other qualified defined benefit plan
maintained by the Company and covering the Employee if the
Employee had continued to be employed by the Company until the
third anniversary of the Change of Control, assuming Employee
were fully vested thereunder, without regard to any amendment to
such plans made after the Change of Control but prior to
Employee's date of termination of employment, which amendment
adversely affects in any manner the computation of retirement
benefits under such plans; and
(v) notwithstanding any plan provision regarding the payment
of benefits following a change of control of the Company which
shall be superseded hereby, the Company shall pay to the Employee
in a lump sum in cash within 30 days of the date of termination
of employment an amount equal to the then present value of the
actuarial equivalent of the benefits to which the Employee would
be entitled under the Supplemental Pension Plan, the Executive
Excess Retirement Plan and any other non-qualified defined
benefit plan maintained by the Company and covering the Employee
if the Employee had an additional period of service to the
Company ending on the third anniversary of the Change of Control,
assuming the Employee were fully vested thereunder and assuming
retirement at age 55 if Employee is age 52 or younger at the time
of the Change of Control or assuming retirement at the age of the
Employee three years following the Change of Control if Employee
is over age 52 at the time of the Change of Control. Such
payment shall be made without regard to any amendment to such
plans made after the Change of Control but prior to Employee's
date of termination of employment, which amendment adversely
affects in any manner the computation of retirement benefits
under such plans.
(b) DEATH. If, after a Change of Control and during the
Employment Term, the Employee's status as an employee is terminated by
reason of the Employee's death, this Agreement shall terminate without
further obligation to the Employee's legal representatives (other than
those already accrued to the Employee), other than the obligation to
make any payments due pursuant to employee benefit plans maintained by
the Company or its affiliated companies.
(c) DISABILITY. If, after a Change of Control and during the
Employment Term, Employee's status as an employee is terminated by
reason of Employee's Disability, this Agreement shall terminate
without further obligation to the Employee (other than those already
accrued to the Employee), other than the obligation to make any
payments due pursuant to employee benefit plans maintained by the
Company or its affiliated companies.
(d) CAUSE. If, after a Change of Control and during the
Employment Term, the Employee's status as an employee is terminated by
the Company for Cause, this Agreement shall terminate without further
obligation to the Employee other than for obligations imposed by law
and obligations imposed pursuant to any employee benefit plan
maintained by the Company or its affiliated companies.
(e) VOLUNTARY TERMINATION. If, after a Change of Control and
during the Employment Term, the Employee voluntarily terminates his
employment with the Company other than for Good Reason, this Agreement
shall terminate without further obligation to the Employee other than
for obligations imposed by law and obligations imposed pursuant to any
employee benefit plan maintained by the Company or its affiliated
companies.
2.4 ACCRUED OBLIGATIONS AND OTHER BENEFITS. It is the intent of this
Agreement that upon termination of employment for any reason the Employee
be entitled to receive promptly, and in addition to any other benefits
specifically provided, (a) the Employee's Base Salary through the date of
termination to the extent not theretofore paid, (b) any accrued vacation
pay, to the extent not theretofore paid, and (c) any other amounts or
benefits required to be paid or provided or which the Employee is entitled
to receive under any plan, program, policy practice or agreement of the
Company.
2.5 STOCK OPTIONS. The foregoing benefits are intended to be in
addition to the value of any options to acquire Common Stock of the Company
the exercisability of which is accelerated pursuant to the terms of any
stock option, incentive or other similar plan heretofore or hereafter
adopted by the Company.
2.6 PROTECTION OF BENEFITS. To the extent permitted by applicable
law, the Company shall take all reasonable steps to ensure that the
Employee is not, by reason of a Change of Control, deprived of the economic
value (including any value attributable to the Change of Control
transaction) of (a) any options to acquire Common Stock of the Company or
(b) any Common Stock of the Company beneficially owned by the Employee.
2.7 CERTAIN ADDITIONAL PAYMENTS. If after a Change of Control
Employee is subjected to an excise tax as a result of the "excess parachute
payment" provisions of section 4999 of the Internal Revenue Code of 1986,
as amended, whether by virtue of the benefits of this Agreement or by
virtue of any other benefits provided to Employee in connection with a
Change of Control pursuant to Company plans, policies or agreements
(including the value of any options to acquire Common Stock of the Company
the exercisability of which is accelerated pursuant to the terms of any
stock option, incentive or similar plan heretofore or hereafter adopted by
the Company), the Company shall pay to Employee (whether or not his
employment has terminated) such amounts as are necessary to place Employee
in the same position after payment of federal income and excise taxes as he
would have been if such provisions had not been applicable to him.
2.8 LEGAL FEES. The Company agrees to pay as incurred, to the full
extent permitted by law, all legal fees and expenses which the Employee may
reasonably incur as a result of any contest (regardless of the outcome
thereof) by the Company, the Employee or others of the validity or
enforceability of, or liability under, any provision of this Agreement
(including as a result of any contest by the Employee about the amount or
timing of any payment pursuant to this Agreement.)
2.8 SET-OFF; MITIGATION. After a Change of Control, the Company's
and its Affiliates' obligations to make the payments provided for in this
Agreement and otherwise to perform its obligations hereunder shall not be
affected by any set-off, counterclaim, recoupment, defense or other claim,
right or action which the Company or its Affiliates may have against the
Employee or others; except that to the extent the Employee accepts other
employment in connection with which he is provided health insurance
benefits, the Company shall only be required to provide health insurance
benefits to the extent the benefits provided by the Employee's employer are
less favorable than the benefits to which he would otherwise be entitled
hereunder. It is the intent of this Agreement that in no event shall the
Employee be obligated to seek other employment or take any other action by
way of mitigation of the amounts payable to the Employee under any of the
provisions of this Agreement.
2.9 OUTPLACEMENT ASSISTANCE. Upon any termination of employment of
the Employee other than for Cause within three years following a Change of
Control, the Company shall provide to the Employee outplacement assistance
by a reputable firm specializing in such services for the period beginning
with the termination of employment and ending three years following the
Change of Control.
ARTICLE III
MISCELLANEOUS
3.1 BINDING EFFECT; SUCCESSORS.
(a) This Agreement shall be binding upon and inure to the
benefit of the Company and any of its successors or assigns.
(b) This Agreement is personal to the Employee and shall not be
assignable by the Employee without the consent of the Company (there being
no obligation to give such consent) other than such rights or benefits as
are transferred by will or the laws of descent and distribution.
(c) The Company shall require any successor to or assignee of
(whether direct or indirect, by purchase, merger, consolidation or
otherwise) all or substantially all of the assets or businesses of the
Company (i) to assume unconditionally and expressly this Agreement and (ii)
to agree to perform or to cause to be performed all of the obligations
under this Agreement in the same manner and to the same extent as would
have been required of the Company had no assignment or succession occurred,
such assumption to be set forth in a writing reasonably satisfactory to the
Employee.
(d) The Company shall also require all entities that control or
that after the transaction will control (directly or indirectly) the
Company or any such successor or assignee to agree to cause to be performed
all of the obligations under this Agreement, such agreement to be set forth
in a writing reasonably satisfactory to the Employee.
3.2 NOTICES. All notices hereunder must be in writing and shall be
deemed to have been given upon receipt of delivery by: (a) hand (against a
receipt therefor), (b) certified or registered mail, postage prepaid,
return receipt requested, (c) a nationally recognized overnight courier
service (against a receipt therefor) or (d) telecopy transmission with
confirmation of receipt. All such notices must be addressed as follows:
If to the Company, to:
Avondale Industries, Inc.
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Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
If to the Employee, to:
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Avondale Industries, Inc.
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or such other address as to which any party hereto may have notified the
other in writing.
3.3 GOVERNING LAW. This Agreement shall be construed and enforced in
accordance with and governed by the internal laws of the State of Louisiana
without regard to principles of conflict of laws.
3.4 WITHHOLDING. The Employee agrees that the Company has the right
to withhold, from the amounts payable pursuant to this Agreement, all
amounts required to be withheld under applicable income and/or employment
tax laws, or as otherwise stated in documents granting rights that are
affected by this Agreement.
3.5 AMENDMENT, WAIVER. No provision of this Agreement may be
modified, amended or waived except by an instrument in writing signed by
both parties.
3.6 SEVERABILITY. If any term or provision of this Agreement, or the
application thereof to any person or circumstance, shall at any time or to
any extent be invalid, illegal or unenforceable in any respect as written,
Employee and the Company intend for any court construing this Agreement to
modify or limit such provision so as to render it valid and enforceable to
the fullest extent allowed by law. Any such provision that is not
susceptible of such reformation shall be ignored so as to not affect any
other term or provision hereof, and the remainder of this Agreement, or the
application of such term or provision to persons or circumstances other
than those as to which it is held invalid, illegal or unenforceable, shall
not be affected thereby and each term and provision of this Agreement shall
be valid and enforced to the fullest extent permitted by law.
3.7 WAIVER OF BREACH. The waiver by either party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver
of any subsequent breach thereof.
3.8 REMEDIES NOT EXCLUSIVE. No remedy specified herein shall be
deemed to be such party's exclusive remedy, and accordingly, in addition to
all of the rights and remedies provided for in this Agreement, the parties
shall have all other rights and remedies provided to them by applicable
law, rule or regulation.
3.9 COMPANY'S RESERVATION OF RIGHTS. Employee acknowledges and
understands that the Employee serves at the pleasure of the Board and that
the Company has the right at any time to terminate Employee's status as an
employee of the Company, or to change or diminish his status during the
Employment Term, subject to the rights of the Employee to claim the
benefits conferred by this Agreement.
3.10 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of
which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Company and the Employee have caused this
Agreement to be executed as of the Change of Control Agreement Date.
AVONDALE INDUSTRIES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Compensation Committee Chairman
EMPLOYEE:
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