AGREEMENT
Exhibit
10.28
AGREEMENT
THIS
AGREEMENT (the “Agreement”) is made
as of this 31st day of July, 2009, by and between Foundation Coal Corporation
(“Foundation
Coal”) and Xxxxx X. Xxxxxxx (“Executive”).
WHEREAS,
Alpha Natural Resources, Inc. (“Alpha”), has entered
into a Merger Agreement with the indirect parent company of Foundation Coal,
Foundation Coal Holdings, Inc. (“Foundation”), dated
May 11, 2009 (the “Merger Agreement”),
pursuant to which Alpha is to merge with and into Foundation (the “Merger”), with
Foundation as the surviving corporation and Foundation changing its name to
"Alpha Natural Resources, Inc." (the "Company"), and thereafter, Foundation Coal
being merged into the Company, with the Company as the surviving
entity;
WHEREAS,
it is anticipated that the Merger will be finalized and effectuated in the
future (“Closing”) at a date
on or around July 31, 2009 (“Closing
Date”);
WHEREAS,
the Merger Agreement contemplates that the Executive's position as Foundation's
Chief Executive Officer will terminate at the effective time of the
Merger;
WHEREAS,
Foundation Coal employs Executive pursuant to the terms and conditions set forth
in that certain Employment Agreement, dated as of January 1, 2009 (the “Employment
Agreement”), which provides for certain payments and benefits in the
event that the Executive's employment is terminated under certain
circumstances;
WHEREAS,
the Executive and Foundation Coal acknowledge and agree that the termination of
Executive's employment and his position as Chief Executive Officer would give
rise to Executive's involuntary termination without “Cause” (as defined in the
Employment Agreement), with severance payments and benefits to be provided to
Executive in accordance with the terms of the Executive's Employment
Agreement;
WHEREAS,
Foundation Coal desires to involuntarily terminate the Executive's employment
and his position as Chief Executive Officer of Foundation effective upon the
consummation of the Closing (“Date of Termination”)
under the terms and conditions provided herein; and
WHEREAS,
Foundation Coal sponsors the Foundation Coal Salaried and Non-Represented Hourly
Severance Plan, as amended, which provides for certain payments and benefits in
the event that the Executive's employment is terminated under certain
circumstances, so long as the Executive executes and does not revoke a release
of claims.
NOW,
THEREFORE, IT IS HEREBY AGREED by and between the Executive and Foundation Coal
as follows:
1. (a) The
Executive, for and in consideration of the commitments of Foundation Coal, as
set forth in this Agreement, and intending to be legally bound, does hereby
REMISE, RELEASE AND FOREVER DISCHARGE Foundation, Foundation Coal, and their
respective parents, subsidiaries and affiliates, and their respective present or
former officers, directors, shareholders, employees, attorneys and agents, and
its and their respective successors, assigns, heirs, executors, and
administrators and the current and former trustees or administrators of any
pension or other benefit plan applicable to the employees or former employees of
Foundation Coal (collectively, “Releasees”) from all
causes of action, suits, debts, claims and demands whatsoever in law or in
equity, which the Executive ever had, now has, or hereafter may have, whether
known or unknown, or which the Executive's heirs, executors, or administrators
may have, by reason of any matter, cause or thing whatsoever, from any time
prior to the date of this Agreement, and particularly, but without limitation of
the foregoing general terms, any claims arising from or relating in any way to
the Executive's position as Foundation's Chief Executive Officer, any right to
severance payments or benefits under Executive's Employment Agreement, the terms
and conditions of the employment relationship, and the termination of the
employment relationship, including, but not limited to, any claims arising under
the Age Discrimination in Employment Act, the Older Workers Benefit Protection
Act, Title VII of the Civil Rights Act of 1964, the Americans with Disabilities
Act, the Employee Retirement Income Security Act of 1974, the Family Medical
Leave Act, and any other claims under any federal, state or local common law,
statutory, or regulatory provision, now or hereafter recognized, and any claims
for attorneys' fees and costs; provided, however, that nothing contained herein
shall be deemed to be a release of the obligations of Foundation Coal under this
Agreement. This Agreement is effective without regard to the legal
nature of the claims raised and without regard to whether any such claims are
based upon tort, equity, implied or express contract or discrimination of any
sort.
(b) To the
fullest extent permitted by law, and subject to the provisions of
paragraphs 8 and 10 of this Agreement, the Executive represents and affirms
that the Executive has not filed or caused to be filed on the Executive's behalf
any charge, complaint or claim for relief against any Releasee and, to the best
of the Executive's knowledge and belief, no outstanding charges, complaints or
claims for relief have been filed or asserted against any Releasee on the
Executive's behalf; and the Executive has not reported any improper, unethical
or illegal conduct or activities to any supervisor, manager, department head,
human resources representative, agent or other representative of any Releasee,
to any member of any Releasee's legal or compliance departments, or
to the ethics hotline, and has no knowledge of any such improper, unethical or
illegal conduct or activities. In the event that there is outstanding
any such charge, complaint or claim for relief, Executive agrees to seek its
immediate withdrawal and dismissal with prejudice. In the event that
for any reason said charge, complaint or claim for relief cannot be withdrawn,
Executive shall not voluntarily testify, provide documents or otherwise
participate in any investigation or litigation arising therefrom or associated
therewith and shall execute such other papers or documents as Foundation Coal’s
counsel determines may be necessary to have said charge, complaint or claim for
relief dismissed with prejudice. Nothing herein shall prevent
Executive from testifying in any cause of action when required to do so by
process of law. Executive shall promptly inform the Company if called
upon to testify.
(c) Executive
does not waive any right to file a charge with the Equal Employment Opportunity
Commission (“EEOC”) or participate
in an investigation or proceeding conducted by the EEOC, but explicitly waives
any right to file a personal lawsuit or receive monetary damages that the EEOC
might recover if said charge results in an EEOC lawsuit against the
Releasees.
(d) Foundation
Coal, for and in consideration of the commitments of Executive as set forth in
this Agreement, and intending to be legally bound, does hereby REMISE, RELEASE
AND FOREVER DISCHARGE Executive, his heirs, executors, administrators and
assigns from all causes of action, suits, debts, claims and demands whatsoever
in law or in equity, which Foundation Coal ever had, now has, or hereafter may
have, whether known or unknown by reason of any matter, cause or thing
whatsoever, from any time prior to the date of this Agreement, and particularly,
but without limitation of the foregoing general terms, any claims arising from
or relating in any way to the Executive's position as Foundation’s Chief
Executive Officer, the terms and conditions of the employment relationship, and
the termination of the employment relationship, and any other claims under any
federal, state or local common law, statutory, or regulatory provision, now or
hereafter recognized, and any claims for attorneys' fees and costs; provided,
however, that this release shall not include any claims or causes of action
arising out of, based upon or attributable to (i) Executive's commission of any
improper act from which he derived an improper personal benefit which act and
benefit are not actually known to Foundation Coal as of the date it executes
this Agreement and/or (ii) Executive's commission of any act of intentional
misconduct, including any fraudulent act. This Agreement is effective
without regard to the legal nature of the claims raised and without regard to
whether any such claims are based upon tort, equity, implied or express contract
or discrimination of any sort.
2. In
consideration of Foundation Coal’s agreements as set forth herein, the Executive
agrees to comply with the limitations described in Article 8 and Article 9 of
the Employment Agreement which are expressly incorporated herein and which the
Executive expressly acknowledges apply to, and are for the protection of, the
business and interests of Foundation Coal, any successor, assign, transferee or
surviving entity, and all other Releasees.
3. The
Executive further agrees that the Executive will not disparage or subvert any
Releasee, or make any statement reflecting negatively on any Releasee,
including, but not limited to, on any matters relating to the operation or
management of any Releasee, the Executive's position as Chief Executive Officer
of Foundation and the termination of the Executive's position as Chief Executive
Officer of Foundation, irrespective of the truthfulness or falsity of such
statement.
4. Foundation
Coal agrees to pay or provide to or for the Executive the following payments and
benefits:
(a) Regardless
of whether the Executive signs and does not revoke this Agreement, the Executive
will receive the following:
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i.
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All
base salary earned, accrued or owing to the Executive through the Date of
Termination (less all applicable withholdings), payable with Executive’s
final paycheck as Chief Executive Officer of Foundation in accordance with
the Company's established payroll
practices.
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ii.
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Reimbursement
for any unreimbursed business expenses properly incurred by the Executive
prior to the Date of Termination, in accordance with the Company's
business expense reimbursement
policies.
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iii.
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Such
employee benefits, including, but not limited to, any supplemental
executive retirement plan, retiree medical plan or pension plan, as to
which Executive may be entitled pursuant to Foundation Coal employee
benefit plans (other than annual bonus plans and the Foundation Coal
Salaried and Non-Represented Hourly Severance Plan) in which Executive
participates as of the Date of Termination, subject to the terms and
conditions of such employee benefit
plans.
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(b) Additionally,
in consideration for the Executive's promises, as set forth herein, Foundation
Coal agrees to pay or provide to or for the Executive, provided Executive
executes this Agreement without revocation and subject to Executive’s continued
compliance with the provisions of Article 8 and Article 9 of the Employment
Agreement, which are expressly incorporated herein, $2,898,000, payable in equal
bi-monthly installments over a period of nine (9) months following the Date of
Termination, in accordance with the Company’s usual payroll practices; provided that the aggregate
amount set forth in this paragraph 4(b) shall be reduced, but not below zero, by
the present value of any other cash severance or cash termination benefits
payable to Executive under any other plans, programs or arrangements of the
Company or its affiliates, including, without limitation, the Foundation Coal
Salaried and Non-Represented Hourly Severance Plan or any other severance plan
of the Company in which Executive is entitled to participate; and
(c) The
amount due under the Foundation Coal Salaried and Non-Represented Hourly
Severance Plan is subject to, and payable in accordance with, the terms of that
Plan, including, but not limited to, the execution and non-revocation of this
release;
(d) A lump
sum payment equal to $422,625, payable with Executive's final pay check as Chief
Executive Officer of Foundation in accordance with Foundation Coal’s established
payroll practices; and
(e) Except as
otherwise specifically provided in this Agreement, all cash payments and/or
reimbursements to be made pursuant to paragraphs 4(a) and 4(d) of this Agreement
shall be made by the Company to the Executive no later than 60 days after the
Date of Termination.
5. Except as
specifically set forth in this Agreement or the Merger Agreement, it is
expressly agreed and understood that Releasees do not have, and will not have,
any obligations to provide the Executive at any time in the future with any
payments, benefits or considerations other than those recited in this Agreement,
those recited in the Merger Agreement,
and those required by law.
6. The
Executive understands and agrees that the payments, benefits and agreements
provided in this Agreement are being provided to him in consideration for the
Executive's acceptance and execution of, and in reliance upon the Executive's
representations in, this Agreement.
7. The
Executive acknowledges and agrees that, except as expressly stated herein and
for Article 11 and Sections (b), (e), (f), (g), (h), (i), (l) and (m) of Article
12 of the Employment Agreement, this Agreement supersedes and replaces the
Employment Agreement. To the extent the Executive has entered into
any other enforceable written agreement with any Releasee that contains
provisions that are outside the scope of this Agreement and are not in direct
conflict with the provisions in this Agreement, the terms in this Agreement
shall not supersede, but shall be in addition to, any other such
agreement. Except as set forth expressly herein, no promises or
representations have been made to the Executive in connection with the
termination of the Executive's Employment Agreement, or the terms of this
Agreement.
8. Nothing
in this Agreement shall prohibit or restrict the Executive from: (i)
making any disclosure of information required by law; (ii) providing information
to, or testifying or otherwise assisting in any investigation or proceeding
brought by, any federal regulatory or law enforcement agency or legislative
body, any self-regulatory organization, or Foundation Coal’s designated legal,
compliance or human resources officers; or (iii) filing, testifying,
participating in or otherwise assisting in a proceeding relating to an alleged
violation of any federal, state or municipal law relating to fraud, or any rule
or regulation of the Securities and Exchange Commission or any self-regulatory
organization.
9. The
parties agree and acknowledge that the agreement by Foundation Coal described
herein, and the settlement and termination of any asserted or unasserted claims
against the Releasees, are not and shall not be construed to be an admission of
any violation of any federal, state or local statute or regulation, or of any
duty owed by any of the Releasees to the Executive.
10. The
Executive agrees and recognizes that should the Executive breach his ongoing
obligations or covenants set forth in Articles 8 and 9 of the Employment
Agreement, Foundation Coal and any successor, assign, transferee or surviving
entity will have no further obligation to provide the Executive with the
consideration set forth in paragraph 4(b) of this
Agreement. Notwithstanding the foregoing, in the event Foundation
Coal or any successor, assign, transferee or surviving entity fails to perform
any material obligation under this Agreement, including, without limitation, the
failure of Foundation Coal or any successor, assign, transferee or surviving
entity to make timely payments of monies due to Executive hereunder, this
Agreement shall be null and void and the Executive shall have the right to
pursue any and all appropriate relief for any such failure, including monetary
damages, attorneys' fees and costs; provided, that (i) the Executive has
notified Foundation Coal, or any successor, assign, transferee or surviving
entity, in writing within thirty (30) days of the date of the failure of
Foundation Coal or any successor or assignee to perform such material obligation
and (ii) such failure remains uncorrected and/or uncontested by Foundation Coal
or any successor, assign, transferee or surviving entity for fifteen (15) days
following the date of such notice.
11. To the
maximum extent permitted by Foundation Coal’s certificate of incorporation, as
amended (or any successor, assign, transferee or surviving entity, as
applicable), and law, Foundation Coal (or, if applicable, or any
successor, assign, transferee or surviving entity) shall indemnify the Executive
in his current and former capacities as an officer, director or manager of
Foundation and its subsidiaries and hold him harmless from any cost, attorneys'
fees, expense or liability arising out of Executive's performing of services for
Foundation and its subsidiaries. Foundation Coal further agrees that the
Executive shall be indemnified and held harmless to the fullest extent permitted
or authorized by applicable law against any and all taxes, interest or penalties
imposed on the Executive with respect to any violation of Section 409A occurring
in connection with any payment made by Foundation Coal to the Executive,
including payments made pursuant to the Agreement or any employee benefit plan
or other compensatory arrangement of Foundation Coal in which the Executive is a
participant, and such indemnification shall continue as to the Executive even if
he has ceased to be a director, employee or agent of Foundation and shall inure
to the benefit of the Executive’s heirs, executors and
administrators. If a payment is required to be made by Foundation
Coal to the Executive with respect to a violation of Section 409A, Foundation
Coal shall make such payment no later than the end of the Executive's taxable
year following the Executive's taxable year in which the Executive remits the
related taxes.
12. This
Agreement and the obligations of the parties hereunder shall be construed,
interpreted and enforced in accordance with the laws of the State of
Maryland.
13. The
provisions of this Agreement will be administered, interpreted and construed in
a manner intended to comply with Section 409A of the Internal Revenue Code
(“Section
409A”), the regulations issued thereunder or any exception thereto (or
disregarded to the extent such provision cannot be so administered, interpreted,
or construed).
(a) For
purposes of Section 409A, each payment shall be treated as a separate
payment. Each payment under this Agreement is intended to be excepted
from Section 409A to the maximum extent provided under Section 409A as follows:
(i) each payment that is scheduled to be made within the applicable 2½ month
period specified in Treas. Reg. § 1.409A-1(b)(4) is intended to be excepted
under the short-term deferral exception as specified in Treas. Reg. §
1.409A-1(b)(4); (ii) post-termination medical benefits, if any, are intended to
be excepted under the medical benefits exception as specified in Treas. Reg. §
1.409A-1(b)(9)(v)(B), and (iii) each payment that is not otherwise excepted
under the short-term deferral exception or medical benefits exception is
intended to be excepted under the involuntary pay exception as specified in
Treas. Reg. § 1.409A-1(b)(9)(iii). The Executive shall have no right
to designate the date of any payment under this Agreement.
(b) With
respect to payments subject to Section 409A of the Internal Revenue Code (and
not excepted therefrom), if any, it is intended that each payment is paid on a
permissible distribution event and at a specified time consistent with Section
409A of the Internal Revenue Code. Notwithstanding any provision of
this Agreement to the contrary, to the extent that a payment hereunder is
subject to Section 409A of the Internal Revenue Code (and not excepted
therefrom) and payable on account or a termination of employment, such payment
shall be delayed for a period of six months after the date of termination of
employment (or, if earlier, the death of the Executive). Any payment
that would otherwise have been due or owing during such six-month period will be
paid immediately following the end of the six-month period in the month
following the month containing the six (6) month anniversary of the date of
termination of employment.
(c) For
purposes of the Agreement, the Executive shall be considered to have experienced
a termination of employment only if the Executive has separated from service
with Foundation Coal (or any successor, assign, transferee or surviving entity)
and all of its controlled group members within the meaning of Section 409A of
the Internal Revenue Code. For purposes hereof, the determination of
controlled group members shall be made pursuant to the provisions of Section
414(b) and 414(c) of the Internal Revenue Code; provided that the language “at
least 50 percent” shall be used instead of “at least 80 percent” in each place
it appears in Section 1563(a)(1),(2) and (3) of the Internal Revenue Code and
Treas. Reg. § 1.414(c)-2. Whether the Executive has separated from
service will be determined based on all of the facts and circumstances and in
accordance with the guidance issued under Section 409A of the Internal Revenue
Code.
(d) Notwithstanding
the foregoing or any provision of this Agreement to the contrary, Foundation
Coal or any successor, assign, transferee or surviving entity may at
any time (after consultation with the Executive) modify or amend the provisions
of this Agreement or take any other
action, to the extent necessary or advisable to conform the provisions of this
Agreement or the benefits provided thereunder with Section 409A of the Internal
Revenue Code, the regulations issued thereunder or an exception
thereto.
14. The
parties agree that this Agreement shall be deemed to have been made and entered
into in Xxxxxxxxx Heights, Maryland. Jurisdiction and venue in any
proceeding by Foundation Coal, or any successor, assign, transferee or surviving
entity or Executive to enforce their rights hereunder is specifically limited to
any court geographically located in Maryland.
15. The
Executive certifies and acknowledges as follows:
(a) That the
Executive has read the terms of this Agreement, and that the Executive
understands its terms and effects, including the fact that the Executive has
agreed to RELEASE AND FOREVER DISCHARGE the Releasees from any legal action
arising out of the Executive's employment relationship with Foundation Coal;
and
(b) That the
Executive has signed this Agreement voluntarily and knowingly in exchange for
the consideration described herein, which the Executive acknowledges is adequate
and satisfactory to him and which the Executive acknowledges is in addition to
any other benefits to which the Executive is otherwise entitled;
and
(c) That the
Executive has been and is hereby advised in writing to consult with an attorney
prior to signing this Agreement; and
(d) That the
Executive does not waive rights or claims that may arise after the date this
Agreement is executed; and
(e) That
Foundation Coal has provided Executive with a period of twenty-one (21) days
within which to consider this Agreement, and that the Executive has signed on
the date indicated below after concluding that this Agreement is satisfactory to
Executive; and
(f) The
Executive acknowledges that this Agreement may be revoked by him within seven
(7) days after execution, and it shall not become effective until the expiration
of such seven (7) day revocation period. In the event of a timely
revocation by the Executive, this Agreement will be deemed null and void and
Foundation Coal and any successor, assign, transferee or surviving entity , and
any affiliate thereof, will have no obligations hereunder.
(g) This
Agreement shall be null and void in its entirety if the Merger is not
effectuated at a Closing. A successful Closing is a condition
precedent to this Agreement.
(h) The
Executive agrees that this Agreement, including but not limited to the
provisions of paragraph 2 of this Agreement, shall inure to the benefit of the
successors and legal representatives of Foundation Coal. The
Executive agrees that Foundation Coal or the Company may only assign or transfer
this Agreement and the restrictions contained therein to an affiliate of either
Foundation Coal or the Company, including but not limited to the provisions of
paragraph 2 of this Agreement, and agrees to be obligated by this Agreement and
said restrictions insofar as they apply to any such successor, assign,
transferee or surviving entity. Executive agrees that Executive may
not assign or transfer this Agreement.
(i) It is a
condition precedent that this Agreement be executed in conjunction with the
Closing and on the Closing Date to be effective and binding against and to be
performed by the Company, as Foundation Coal’s successor, and it is further
acknowledged by Executive that the Company, as successor to Foundation Coal,
shall have all the rights and benefits of Foundation Coal under this
Agreement.
[SIGNATURE
PAGE FOLLOWS]
Intending
to be legally bound hereby, the Executive and Foundation Coal executed the
foregoing Agreement this 31st day of July, 2009.
/s/ Xxxxx
X.
Xxxxxxx Witness: /s/ Xxxxxxx
Belt
XXXXX X.
XXXXXXX
FOUNDATION
COAL CORPORATION
By: Xxxxxxx X.
Xxxxxxx Witness: /s/ Xxxxxxx
Belt
Name: Xxxxxxx X.
Xxxxxxx
Title: SVP Safety &
Human
Resources
