EXHIBIT 10.3(c)
MAGNESIUM CORPORATION OF AMERICA
000 XXXXX 0000 XXXX
XXXX XXXX XXXX, XXXX 00000
June 11, 1996
Xx. Xxx X. Xxxxx
c/o Magnesium Corporation of America
000 Xxxxx 0000 Xxxx
Xxxx Xxxx Xxxx, Xxxx 00000
Dear Sir:
Reference is made to your net worth appreciation
participation agreement with this Corporation (the "Agreement").
This will confirm our agreement with you as follows:
1. As you know, our parent company, Renco Metals,
Inc. ("Renco Metals") is contemplating a refinancing under which it
will issue $150,000,000 of Senior Notes due 2003 ("New Notes") and
retire its presently outstanding $75,000,000 of Senior Notes due
2000 (the "Existing Notes"). On the issuance of the New Notes this
company will pay a dividend to Renco Metals. Concurrently with the
payment of such dividend this company will make a payment to you on
account of the dividend and the Agreement and you will accept same
in full settlement of all of your rights arising from the payment
of the dividend. In consideration of such payment and your
agreement to the amendments to the Agreement as outlined in
paragraph 2 below, the Company agrees that although after paying
the above mentioned payment "Cumulative Net Income" under the
Agreement would be approximately negative $50,000,000,
nevertheless, your Cumulative Net Income will be deemed to be zero
as of July 31, 1996. Your Cumulative Net Income participation shall
be calculated on the company's Cumulative Net Income accruing after
that date.
2. Notwithstanding anything in the Agreement in
the contrary, you agree, effective upon your receipt of the
payment referred to in paragraph 1 of this letter, as follows:
(a) Should you voluntarily leave the employ of
this company before the earlier of the 15th anniversary of this
agreement or your attainment of age 62, then the payment of
the Payment (as defined in the "Agreement") to you shall not
commence until such anniversary or your attaining age 62.
Notwithstanding the foregoing,
payments shall commence immediately upon your death or upon your
continuing disability making it impossible for you to continue to
perform your normal business duties.
(b) You agree that, so long as you are
entitled to any part of the Payment, you will not, directly or
indirectly, whether as employee, consultant, proprietor, partner,
stockholder or other capacity, engage in any aspect of the
magnesium business (production, marketing, sales, use) in any part
of the world. In this respect, you and we acknowledge that the
primary magnesium industry is a worldwide industry, that the
participants therein compete against each other in all parts of the
world, and that therefore this restriction is reasonable.
Should you engage in any activity
proscribed by the preceding paragraph then the company's obligation
to you to make the Payment (or any unpaid part thereof) shall
automatically and permanently cease, and you shall be deemed to
have irrevocably released you right to same.
(c) Should you voluntarily leave the company, you
shall give 30 days advance written notice, and the amount of your
Payment will be calculated as to the close of the fiscal quarter in
which such 30 day notice period ends.
4. The parties hereby reaffirm the Agreement as amended
hereby.
Please confirm your agreement to the foregoing by
signing and returning the enclosed copy.
Very truly yours,
MAGNESIUM CORPORATION
OF AMERICA
By /s/ Xxxxxxx X. Xxxxx
-----------------------
CONFIRMED AND AGREED TO:
/s/ Xxx X. Xxxxx
--------------------------
Xxx X. Xxxxx
