EXHIBIT 10.3
THIRD AMENDED & RESTATED EMPLOYMENT AGREEMENT
This Third Amended & Restated Employment Agreement ("Agreement"), dated
this 22nd day of March, 2006, is entered into by and between Alpha Natural
Resources Services, LLC, on behalf of itself and its parent entities,
subsidiaries and affiliates as may employ Employee from time to time
(collectively, the "Employer"), and Xxxxxxx X. Xxxxxxx ("Employee") and is
effective as of January 1, 2006 (the "Effective Date").
WITNESSETH:
WHEREAS, Employer employs Employee pursuant to the terms and conditions set
forth in that certain Employment Agreement dated as of January 1, 2003 between
Employee and Alpha Natural Resources, LLC, that was assigned to Employer as of
December 31, 2003, amended and restated March 31, 2004, and further amended and
restated as of January 28, 2005 (the "Second Amended and Restated Agreement");
and
WHEREAS, Employer and Employee desire to amend and restate the Second
Amended and Restated Agreement and to continue the employment of Employee by
Employer pursuant to the terms and conditions set forth in this Agreement;
NOW, THEREFORE, for and in consideration of the mutual promises, covenants
and obligations contained herein, Employer and Employee agree as follows:
ARTICLE 1: EMPLOYMENT AND DUTIES:
1.1 Employer agrees to employ Employee, and Employee agrees to be employed
by Employer, beginning as of the Effective Date and continuing through December
31, 2006 (the "Term"), subject to the terms and conditions of this Agreement.
The Term shall be automatically extended for successive 12-month periods unless
either party provides written notice to the other at least 120 days prior to the
end of the then current Term of such party's election not to extend the Term
except, in the case of retirement, in which Employee shall provide six (6)
months advance written notice to the Employer.
1.2 Beginning as of the Effective Date, Employee shall continue to be
employed by Employer and be the President and Chief Executive Officer of Alpha
Natural Resources, Inc., the indirect parent of Employer ("Alpha Natural
Resources"), and shall be nominated for re-election to the Board of Directors
(the "Board of Directors") of, Alpha Natural Resources. Employee shall report to
the Board of Directors of Alpha Natural Resources. Employee shall serve in the
assigned positions or in such other executive capacities as may be agreed to,
from time to time, between Employee and Employer, the Board of Directors, and/or
the Employer Entities (as defined below). Employee agrees to perform diligently
and to the best of Employee's abilities, and in a trustworthy, businesslike and
efficient manner, the duties and services pertaining to such positions as
reasonably determined by Employer and the Board of Directors, as well as such
additional or different duties and services appropriate to such positions which
Employee from time to time may be reasonably directed to perform by the Board of
Directors and/or Employer.
1.3 Employee shall at all times comply with, and be subject to, such
policies and procedures as Employer and/or the Employer Entities may establish
from time to time, including, without limitation, Alpha Natural Resources' Code
of Business Conduct (the "Code of Business Conduct").
1.4 Except as expressly approved by the Board of Directors, Employee shall,
during the period of Employee's employment by Employer, devote Employee's full
business time, energy, and best efforts to the business and affairs of Employer
and the Employer Entities. Employee may not engage, directly or indirectly, in
any other business, investment, or activity that interferes with Employee's
performance of Employee's duties hereunder, is contrary to the interest of
Employer or any of its parent entities, affiliated subsidiaries and divisions
(each an "Employer Entity," or collectively, the "Employer Entities") or
requires any significant portion of Employee's business time. The foregoing
notwithstanding, the parties recognize and agree that Employee may engage in
passive personal investments and other business activities which do not conflict
with the business and affairs of the Employer Entities or interfere with
Employee's performance of his duties hereunder. Employee may not serve on the
board of directors of any entity other than an Employer Entity, related industry
trade association, public institution, or government appointed public or
quasi-public body during the Term without prior approval therefor by the Board
of Directors in accordance with Employer's and/or Employer Entities' policies
and procedures regarding such service. Employee shall be permitted to retain any
compensation received for approved service on any unaffiliated corporation's
board of directors.
1.5 Employee acknowledges and agrees that Employee owes a fiduciary duty of
loyalty, fidelity, and allegiance to act at all times in the best interests of
the Employer and the other Employer Entities and to do no act which would,
directly or indirectly, injure any such entity's business, interests, or
reputation. It is agreed that any direct or indirect interest in, connection
with, or benefit from any outside activities, particularly commercial
activities, which interest might in any way adversely affect Employer, or any
Employer Entity, involves a possible conflict of interest. In keeping with
Employee's fiduciary duties to Employer and the Employer Entities, Employee
agrees that Employee shall not knowingly become involved in a conflict of
interest with Employer or any Employer Entity, or upon discovery thereof, allow
such a conflict to continue. Moreover, Employee shall not engage in any activity
that might involve a possible conflict of interest without first obtaining
approval in accordance with Employer's and Employer Entities' policies and
procedures.
1.6 Nothing contained in this Agreement shall be construed to preclude the
transfer of Employee's employment to another Employer Entity ("Subsequent
Employer") as of, or at any time after, the Effective Date and no such transfer
shall be deemed to be a termination of employment for purposes of Article 3
hereof; provided, however, that, effective with such transfer, all of Employer's
obligations hereunder shall be assumed by and be binding upon, and all of
Employer's rights hereunder shall be assigned to, such Subsequent Employer and
the defined term "Employer" as used herein and any other terms referring and/or
relating to Employer shall thereafter be deemed amended to mean and refer to
such Subsequent Employer. Except as otherwise provided above, all of the terms
and conditions of this Agreement, including without limitation, Employee's
rights, compensation, benefits and obligations, shall remain in all
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material respects and taken as a whole, no less favorable to Employee following
such transfer of employment.
ARTICLE 2: COMPENSATION AND BENEFITS:
2.1 Employee's base salary during the Term shall be $650,000 (Six Hundred,
Fifty Thousand Dollars) per annum which shall be paid in accordance with the
Employer's standard payroll practice. Employee's base salary shall be reviewed
annually by the Compensation Committee of the Board of Directors (the
"Compensation Committee") or the Board of Directors and may be increased, in the
Compensation Committee's or Board of Directors' sole discretion, from time to
time. Such increased base salary shall become the minimum base salary under this
Agreement and may not be decreased thereafter without the written consent of
Employee unless otherwise permitted by this Agreement.
2.2 During the Term, Employee shall participate in a bonus plan pursuant to
which an annual bonus shall be paid to Employee in an amount to be determined by
the Compensation Committee or the Board of Directors, which annual bonus shall
be targeted at 100% of Employee's then current base salary (the "Target Bonus"),
with a maximum target bonus opportunity of 200% of Employee's then current base
salary. Payment of the bonus shall be made at the same time as bonuses are paid
to other senior executive officers and shall be based on parameters, including,
without limitation, performance goals applicable to Employee, and such
parameters shall be approved by the Compensation Committee or Board of
Directors.
2.3 During the Term, the Employee shall participate in Alpha Natural
Resources' long-term incentive plans, including its equity incentive plans, on
the terms established from time to time by the Compensation Committee or the
Board; provided that, to the extent the Compensation Committee or Board of
Directors makes any grants of equity securities under such plans to senior
executive officers which report directly to the Employee (collectively, "Direct
Reports"), Employee shall receive an equity grant of the same type of security
to be granted to such Direct Reports which shall be targeted at 150% of the
highest number of such security granted to any Direct Report on a particular
grant date and under the same terms and conditions of such award.
Notwithstanding the foregoing, this Section 2.3 shall not apply to any
inducement award which the Compensation Committee or Board of Directors
determines to make to any potential new employee of Employer.
2.4 The Employee shall participate in Alpha Natural Resources' Retention
Compensation Plan, dated November 10, 2005 (the "Retention Compensation Plan")
on the same basis, and under the same terms and conditions, as his Direct
Reports.
2.5 During the Term, in the event of a Change in Control (as defined
below), Employee shall be entitled to receive a minimum lump sum cash payment
equal to a pro rata Target Bonus for the year in which the Change in Control
occurs, which shall be based on the portion of such year that Employee was
employed by Employer prior to the effective date of the Change in Control. Such
payment, if any, shall be made no later than 60 days after the effective date of
the Change in Control.
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2.6 The Executive shall be entitled to at least four (4) weeks paid
vacation in each calendar year, or such greater amount of vacation as may be
determined in accordance with Employer's vacation policy as in effect from time
to time. The Executive shall also be entitled to all paid holidays given by
Employer to its executives.
2.7 During the Term, Employer shall pay or reimburse Employee for all
actual, reasonable and customary expenses incurred by Employee in the course of
his employment; provided that such expenses are incurred and accounted for in
accordance with Employer's applicable policies and procedures.
2.8 While employed by Employer, Employee shall be allowed to participate,
on the same basis generally as other employees of Employer, in all general
employee benefit plans and programs, including improvements or modifications of
the same, which on the Effective Date or thereafter are made available by
Employer and/or the Employer Entities to all or substantially all of Employer's
similarly situated employees. Such benefits, plans, and programs may include,
without limitation, medical, health, and dental care, life insurance, disability
protection, qualified and non-qualified retirement plans, retiree medical plans
and stock option and stock grant programs, if any. Except as specifically
provided in this Agreement, nothing in this Agreement is to be construed or
interpreted to increase or alter in any way the rights, participation, coverage,
or benefits under such benefit plans or programs than provided to similarly
situated employees pursuant to the terms and conditions of such benefit plans
and programs.
2.9 Notwithstanding anything to the contrary in this Agreement, it is
specifically understood and agreed that Employer and the Employer Entities shall
not be obligated to institute, maintain, or refrain from changing, amending, or
discontinuing any incentive, employee benefit or stock or stock option program
or plan, so long as such actions are similarly applicable to covered employees
generally.
2.10 Employer shall withhold from any compensation, benefits, or amounts
payable under this Agreement all federal, state, city, or other taxes as may be
required pursuant to any law or governmental regulation or ruling.
ARTICLE 3: TERMINATION OF EMPLOYMENT AND EFFECTS OF SUCH TERMINATION
3.1 Employee's employment with Employer shall be terminated prior to the
end of the Term: (i) upon the death of Employee, (ii) upon Employee's Retirement
(as defined below), (iii) upon Employee's Permanent Disability (as defined
below), (iv) at any time by Employer upon written notice to Employee, or (v) by
Employee upon 60 days written notice to Employer.
3.2 If Employee's employment is terminated by reason of any of the
following circumstances (i), (ii), (iii), or (iv), Employee shall be entitled to
receive only the benefits set forth in Section 3.3 below:
(i) Termination due to Employee's Retirement. "Retirement" shall mean
Employee's retirement at or after normal retirement age (either
voluntarily or pursuant to Employer's retirement policy).
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(ii) Termination by Employer for Employer Cause. Termination of Employee's
employment for "Employer Cause" shall mean termination of Employee's
employment by Employer for any of the following: (a) Employee's gross
negligence or willful misconduct in the performance of the duties and
services required of Employee pursuant to this Agreement, (b)
Employee's final conviction of, or plea of guilty or nolo contendere
to, a felony or Employee engaging in fraudulent or criminal activity
relating to the scope of Employee's employment (whether or not
prosecuted), (c) a material violation of Alpha Natural Resources' Code
of Business Conduct, (d) Employee's material breach of any material
provision of this Agreement, provided that Employee has received
written notice from the Employer and been afforded a reasonable
opportunity (not to exceed 30 days) to cure such breach, (e) any
continuing or repeated failure to perform the duties as requested in
writing by the Employee's supervisor(s) or the Board of Directors
after Employee has been afforded a reasonable opportunity (not to
exceed 30 days) to cure such breach, (f) the commission of a felony or
crime involving moral turpitude, or (g) conduct which brings Employer
and/or the Employer Entities into public disgrace or disrepute in any
material respect. Determination as to whether or not Employer Cause
exists for termination of Employee's employment will be made by the
Board of Directors.
(iii) Termination by Employee by Resignation (Other Than for Good Reason).
Employee's resignation, other than for Good Reason (as defined below),
shall mean termination of Employee's employment by Employee's
resignation of employment with Employer and any Employer Entity, but
not including any termination of employment by Employee for Good
Reason as described in Section 3.4(i) or a Termination In Connection
With A Change in Control (as defined below) by Employee described in
Section 3.7.
(iv) Election Not to Renew Term by Employee. Employee elects not to renew
the Term pursuant to Section 1.1 of this Agreement.
3.3 If Employee's employment is terminated by reason of Section 3.2 (i),
(ii), (iii), or (iv), Employee shall be entitled to each of the following:
(i) Employee shall be entitled to: (a) any base salary earned, accrued or
owing to Employee through the effective date of termination of
employment, (b) reimbursement for all reasonable and customary
expenses incurred by Employee in performing services for the Employer
and/or the Employer Entities prior to the effective date of
termination of employment, (c) payment equal to the amount of any
accrued, but unused, vacation time, and (d) any individual bonuses or
individual incentive compensation not yet paid, but due and payable
under Employer's and/or Employer Entities' plans for years prior to
the year of Employee's termination of employment; and, provided
further that, Employee shall not be entitled to: (1) any bonus or
incentive compensation for the year in which he terminates employment
unless specifically granted by the Compensation Committee or Board of
Directors, or (2) any other payments or benefits by or on behalf of
Employer and/or the Employer Entities except for those which may be
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payable pursuant to the terms of Employer's and/or Employer Entities'
employee benefit plans, stock, option, or other equity plans or the
applicable agreements underlying such plans.
(ii) Except for (i) above, it is specifically understood that all future
compensation to which Employee is entitled and all future benefits for
which Employee is eligible, shall cease and terminate as of the
effective date of termination of employment except, if applicable,
retiree medical benefits under the Alpha Natural Resources, LLC and
Subsidiaries Retiree Medical Benefit Plan (including any successors
thereto, the "Retiree Medical Benefit Plan").
3.4 If Employee's employment is terminated by reason of (i), (ii), (iii),
or (iv) below, and, in the case of (i) and (ii), other than a Termination In
Connection With A Change in Control, as otherwise provided in Section 3.7,
Employee shall be entitled to receive the benefits set forth in Section 3.5 or
Section 3.6, as applicable.
(i) Termination by Employee for Good Reason (Other Than A Termination In
Connection With A Change in Control). "Good Reason" shall mean a
termination of employment by Employee because of: (a) the assignment
to Employee of any significant duties materially inconsistent with
Employee's status as an officer of Alpha Natural Resources or a
substantial diminution in the nature of Employee's responsibilities or
Employee's status (including, without limitation, Employee being
required to report to any person other than the Board of Directors)
(without his prior written consent), (b) a material breach by Employer
of any material provision of this Agreement, (c) a relocation of
Employer's principal place of business or of Employee's own office
assigned to Employee by Employer to a location that increases
Employee's normal work commute by more than 50 miles, or (d) any
illegal activity or material violation of governmental laws, rules or
regulations by Employer or the Board of Directors in connection with
the Employer Entities; provided, that such illegal activity or
material violation could reasonably be expected to have a material
adverse effect on Employer and the Employer Entities, taken as a
whole. In order for Employee to terminate for Good Reason, (a)
Employer must be notified by Employee in writing within 90 days of the
event constituting Good Reason, (b) the event must remain uncorrected
by Employer for 30 days following such notice (the "Notice Period"),
and (c) such termination must occur within 60 days after the
expiration of the Notice Period. An across-the-board base salary
and/or Target Bonus opportunity reduction and, in the case of base
salary, not below the initial base salary set forth in Section 2.1,
similarly affecting Employee and all other executives of Employer
shall not constitute a material breach of this Agreement by Employer.
(ii) Employer Termination Without Employer Cause (Other Than A Termination
In Connection With A Change in Control). Termination of Employee's
employment by Employer for any reason other than for Employer Cause
including, without limitation, termination due to Employer's election
not to renew the Term pursuant to Section 1.1, but not including a
Termination In Connection With A Change in Control by Employer
described in Section 3.7.
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(iii) Death. Termination due to the death of Employee.
(iv) Termination due to Employee's Permanent Disability. "Permanent
Disability" shall mean Employee's physical or mental incapacity to
perform his usual duties with such condition likely to remain
continuously and permanently as determined by Employer.
3.5 Subject to the provisions of Section 3.7, Section 3.8, and Section 3.9,
if Employee's employment is terminated by Employee under Section 3.4(i) or by
Employer under Section 3.4(ii), Employee shall be entitled to each of the
following:
(i) Employer shall pay to Employee an amount equal to the sum of: (a) two
(2) times Employee's base salary in effect as of the effective date of
termination of employment plus (b) two (2) times Employee's Target
Bonus for the year in which the effective date of termination of
employment occurs. Except as otherwise provided herein, such
compensation shall be paid to Employee in equal installments in
accordance with Employer's customary payroll practices during the
period commencing on the effective date of termination of employment
and ending on the earlier to occur of (a) the second anniversary of
the effective date of termination of employment or (b) the date
Employee violates any of the covenants set forth in Article 4 or
Article 5 hereof; provided, however, that if Employer determines that
such compensation is subject to Section 409A of the Internal Revenue
Code of 1986, as amended (the "Code"), such compensation shall be paid
to Employee in accordance with the following payment schedule: (1)
one-fourth of such compensation shall be paid to Employee on the six
(6) month anniversary ("Six Month Payment Date") of the effective date
of termination of employment and (2) the remaining balance of such
compensation shall be paid to Employee in equal installments in
accordance with Employer's customary payroll practices commencing the
first pay period after the Six Month Payment Date and ending on the
earlier to occur of (A) the second anniversary of the effective date
of such termination of employment, or (B) the date Employee violates
any of the covenants set forth in Article 4 or Article 5 hereof.
(ii) Employee shall be entitled to a pro rata share of any individual
bonuses or individual incentive compensation, based on the target
levels set for such bonuses, under Employer's and/or Employer
Entities' plans for the year of Employee's termination of employment
based on the portion of such year that Employee was employed by
Employer; provided, however, that there shall not be any pro-ration of
any amounts payable under the Retention Compensation Plan. Payment
shall be made, in lump sum, no later than 60 days after the effective
date of termination of employment unless Employer determines that such
compensation is subject to Section 409A of the Code in which case it
shall be paid to Employee on the Six Month Payment Date.
(iii) Employee shall be entitled to: (a) any base salary earned, accrued or
owing to him under this Agreement through the effective date of
termination of employment, (b) any individual bonuses or individual
incentive compensation not yet paid, but
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due and payable under Employer's and/or Employer Entities' plans for
years prior to the year of Employee's termination of employment, (c)
reimbursement for all reasonable and customary expenses incurred by
Employee in performing services for the Employer and/or the Employer
Entities prior to the effective date of termination of employment, and
(d) payment equal to the amount of accrued, but unused, vacation time.
Such payments, if any, shall be made to Employee no later than 60 days
after the effective date of termination of employment.
(iv) To the extent permitted by applicable law and the insurance and
benefits policies to which Employee is entitled to participate
(collectively, "Benefit Plans"), Employer shall maintain Employee's
paid coverage for health insurance (through the payment of Employee's
COBRA premiums) and other dental and life insurance benefits for the
earlier to occur of: (a) Employee obtaining the age of 65, (b) the
date Employee is provided by another employer benefits substantially
comparable to the benefits provided by the above-referenced Benefit
Plans, or (c) the 24-month anniversary of the effective date of
Employee's termination of employment. During the applicable period of
coverage described in the foregoing sentence, Employee shall be
entitled to benefits on substantially the same basis as would have
otherwise been provided had Employee not been terminated and Employer
will have no obligation to pay any benefits to, or premiums on behalf
of, Employee after such period ends. To the extent that such benefits
are available under the above-referenced Benefit Plans and Employee
had such coverage immediately prior to termination of employment, such
continuation of benefits for Employee shall also cover Employee's
dependents for so long as Employee is receiving benefits under this
paragraph (iv).
3.6 If Employee's employment is terminated by reason of Section 3.4(iii) or
(iv), Employee's estate, in the case of death, or Employee (or his legal
guardian), in the case of Permanent Disability, shall be entitled to payment of:
(a) any base salary earned, accrued or owing to Employee's estate or Employee
(or his legal guardian), as applicable, through the effective date of
termination of employment, (b) any individual bonuses or individual incentive
compensation not yet paid but due and payable under Employer's and/or Employer
Entities' plans for years prior to the year of Employee's termination of
employment, (c) a pro rata share of any individual bonuses or individual
incentive compensation, based on the target levels set for such bonuses, under
Employer's and/or Employer Entities' plans for the year of Employee's
termination of employment based on the portion of such year that Employee was
employed by Employer; provided, however, that there shall not be any pro-ration
of any amounts payable under the Retention Compensation Plan, (d) all reasonable
and customary expenses incurred by Employee in performing services for the
Employer and/or the Employer Entities prior to the effective date of termination
of employment, (e) the amount of accrued, but unused, vacation time, and (f)
participation in the Retiree Medical Benefit Plan, if applicable, and in the
event of Employee's death, Employee's spouse shall be entitled to any benefits
which she is eligible to receive under such plan. All payments shall be paid no
later than 60 days after the effective date of termination of employment;
provided, however, that all payments under clause (c) shall be paid at the time
that such amounts are paid to similarly situated employees.
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3.7 Involuntary Termination In Connection with a Change in Control. In the
event the Employee's employment is terminated during the 90-day period
immediately preceding a Change in Control, or on or within the one-year period
immediately following a Change in Control (a "Termination In Connection With A
Change In Control") by: (i) the Employee for Good Reason or (ii) the Employer
other than (a) for Employer Cause, (b) due to the Employee's death or (c) due to
Permanent Disability, the Employee shall be entitled to receive the benefits set
forth in Section 3.8. For purposes of this Agreement, "Change in Control" shall
mean the occurrence of any of the following after the date of this Agreement:
(a) any merger, consolidation or business combination in which the stockholders
of Alpha Natural Resources immediately prior to the merger, consolidation or
business combination do not own at least a majority of the outstanding equity
interests of the surviving parent entity, (b) the sale of all or substantially
all of Alpha Natural Resources' assets in a single transaction or a series of
related transactions, (c) the acquisition of beneficial ownership or control of
(including, without limitation, power to vote) a majority of the outstanding
common stock of Alpha Natural Resources by any person or entity (including a
"group" as defined by or under Section 13(d)(3) of the Securities Exchange Act
of 1934, as amended), (d) the stockholders of Alpha Natural Resources approve
any plan for the dissolution or liquidation of Alpha Natural Resources, or (e) a
contested election of directors, as a result of which or in connection with
which the persons who were directors of Alpha Natural Resources before such
election or their nominees cease to constitute a majority of Alpha Natural
Resources' Board of Directors.
3.8 Subject to the provisions of Section 3.9, if Employee's employment is
terminated pursuant to Section 3.7, Employee shall be entitled to each of the
following:
(i) Employer shall pay to Employee a lump sum cash payment equal to
(a) three (3) times Employee's base salary in effect as of the effective date of
termination, plus (b) three (3) times Employee's Target Bonus for the year in
which the effective date of the termination occurs. Payment shall be made, in
lump sum, no later than 60 days after the effective date of termination of
employment unless Employer determines that such compensation is subject to
Section 409A of the Code in which case it shall be paid to Employee on the Six
Month Payment Date.
(ii) Employee shall be entitled to a pro rata share of any individual
bonuses or individual incentive compensation, based on the target levels set for
such bonuses, under Employer's and/or Employer Entities' plans for the year of
Employee's termination of employment based on the portion of such year that
Employee was employed by Employer; provided, however, that there shall not be
any pro-ration of any amounts payable under the Retention Compensation Plan.
Payment shall be made, in lump sum, no later than 60 days after the effective
date of termination of employment unless Employer determines that such
compensation is subject to Section 409A of the Code in which case it shall be
paid to Employee on the Six Month Payment Date.
(iii) Employee shall be entitled to: (a) any base salary earned,
accrued or owing to him under this Agreement through the effective date of
termination of employment, (b) any individual bonuses or individual incentive
compensation not yet paid, but due and payable under Employer's and/or Employer
Entities' plans for years prior to the year of Employee's termination of
employment, (c) reimbursement for all reasonable and customary expenses
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incurred by Employee in performing services for the Employer and/or the Employer
Entities prior to the effective date of termination of employment, and (d)
payment equal to the amount of accrued, but unused, vacation time. Such
payments, if any, shall be made to Employee no later than 60 days after the
effective date of termination of employment.
(iv) To the extent permitted by applicable law and the Benefit Plans,
Employer shall maintain Employee's paid coverage for health insurance (through
the payment of Employee's COBRA premiums) and other dental and life insurance
benefits until the earlier to occur of: (a) Employee obtaining the age of 65,
(b) the date Employee is provided by another employer benefits substantially
comparable to the benefits provided by the above-referenced Benefit Plans, or
(c) the 36-month anniversary of the effective date of Employee's termination of
employment. During the applicable period of coverage described in the foregoing
sentence, Employee shall be entitled to benefits, on substantially the same
basis as would have otherwise been provided had Employee not been terminated and
Employer will have no obligation to pay any benefits to, or premiums on behalf
of, Employee after such period ends. To the extent that such benefits are
available under the above-referenced Benefit Plans and Employee had such
coverage immediately prior to termination of employment, such continuation of
benefits for Employee shall also cover Employee's dependents for so long as
Employee is receiving such benefits under paragraph (iv).
(v) If applicable, Employer shall pay to Employee a lump sum cash
payment equal to the difference between the present value of the Employee's
accrued pension benefits on the effective date of Employee's termination under
any qualified defined benefit plan and (if eligible) supplemental retirement
plan (together, the "pension plans") sponsored by Employer or any Employer
Entity and the present value of the accrued pension benefits to which the
Employee would have been entitled under the pension plans if Employee had
continued participation in those plans for the 36-month period after the
effective date of Employee's termination. Such amount shall be determined based
on an average of the amount contributed by Employee in the two (2) years prior
to the effective date of Employee's termination. Payment shall be made, in lump
sum, no later than 60 days after the effective date of termination of employment
unless Employer determines that such compensation is subject to Section 409A of
the Code in which case it shall be paid to Employee on the Six Month Payment
Date.
(vi) Employer shall pay to Employee a lump sum cash payment of $15,000
in order to cover the cost of outplacement assistance services for Employee and
other expenses associated with seeking another employment position. Payment
shall me made, in lump sum, no later than 60 days after the effective date of
termination of employment unless Employer determines that such compensation is
subject to Section 409A of the Code in which case it shall be paid to Employee
on the Six Month Payment Date.
3.9 The severance benefit paid and provided to Employee pursuant to Section
3.3, Section 3.5, 3.8 and/or Section 3.10 shall be in consideration of
Employee's continuing obligations hereunder after such termination of
employment, including, without limitation, Employee's obligations under Article
4 and Article 5. Further, as a condition to the receipt of such severance
benefit, Employer shall require Employee to first execute a release, in
substantially the form attached hereto as Annex A, releasing Employer and all
other Employer Entities, and their respective officers, directors, employees,
and agents, from any and all claims
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and from any and all causes of action of any kind or character, including, but
not limited to, all claims and causes of action arising out of Employee's
employment with Employer and any other Employer Entities or the termination of
such employment. The performance of Employer's obligations under Section 3.3,
Section 3.5, Section 3.8 and/or Section 3.10 and the receipt of the severance
benefit provided thereunder by Employee shall constitute full settlement of all
such claims and causes of action. Employee shall not be under any duty or
obligation to seek or accept other employment following a termination of
employment pursuant to which a severance benefit payment or benefit under
Section 3.3, Section 3.5, Section 3.8 and/or Section 3.10 is owing and the
amounts and benefits due Employee pursuant to Section 3.3, Section 3.5, Section
3.8 and/or Section 3.10 shall not be reduced or suspended, except as otherwise
provided, if Employee accepts subsequent employment or earns any amounts as a
self-employed individual, provided, however that in the event Employee breaches
any of Employee's obligations under Articles 4 or 5 of this Agreement, then, in
addition to Employer's right to specific performance pursuant to Section 5.5 or
any other rights that Employer or each Employer Entity may have under this
Agreement or otherwise, Employer and each Employer Entity shall have the right
to terminate payment of any amounts or benefits to which Employee would
otherwise be entitled pursuant to this Article 3. Employee's rights under
Section 3.3, Section 3.5, Section 3.8 and/or Section 3.10 are Employee's sole
and exclusive rights against the Employer, or any affiliate of Employer, and the
Employer's and the Employer Entities' sole and exclusive liability to Employee
under this Agreement, whether such claim is based in contract, tort or
otherwise, for the termination of his employment relationship with Employer.
Employee agrees that all disputes relating to Employee's employment or
termination of employment shall be resolved through Employer's Dispute
Resolution Plan as provided in Section 7.7 hereof; provided, however, that
decisions as to whether there is "Employer Cause" for termination of the
employment relationship with Employee and whether and as of what date Employee
has become Permanently Disabled shall be limited to whether such decision was
reached in good faith. Nothing contained in this Article 3 shall be construed to
be a waiver by Employee of any benefits accrued for or due Employee under any
employee benefit plan (as such term is defined in the Employees' Retirement
Income Security Act of 1974, as amended) maintained by Employer except that
Employee shall not be entitled to any severance benefits pursuant to any
severance plan or program of the Employer and/or the Employer Entities except as
outlined in this Agreement.
3.10 Vesting of Equity. With respect to any equity awards or grants made by
Employer and/or any Employer Entity after the date of this Agreement and
notwithstanding any provision to the contrary in any applicable plan, program or
agreement, upon a termination of Employee's employment with Employer pursuant to
any of the subparagraphs of Section 3.4 or Section 3.7, all stock options,
restricted stock and other equity rights held by the Employee will become fully
vested and/or exercisable, as the case may be, on the date on which such
termination of employment occurs, and all stock options held by the Employee
shall remain exercisable until the earlier to occur of: (i) the expiration date
of the applicable option term or (ii) the three (3) year anniversary of
Employee's termination date; provided, however, that the payment of
performance-based awards will continue to be subject to the attainment of the
performance goals as specified in the applicable plan or award agreement.
11
3.11 Termination of the employment relationship does not terminate those
obligations imposed by this Agreement, which are continuing obligations,
including, without limitation, Employee's obligations under Article 4 and
Article 5.
3.12 The payment of any monies to Employee under this Agreement after the
date of termination of employment does not constitute an offer or a continuation
of employment of the Employee. In no event shall Employee represent or hold
himself out to be an employee of Employer or any Employer Entity after the
effective date of termination of employment. Except where Employer is lawfully
required to withhold any federal, state, or local taxes, Employee shall be
responsible for any and all federal, state, or local taxes that arise out of any
payments to Employee hereunder.
3.13 During any period during which any monies are being paid to Employee
under this Agreement after the effective date of termination of employment,
Employee shall provide to Employer and any Employer Entity reasonable levels of
assistance in answering questions concerning the business of Employer and any
Employer Entity, transition of responsibility, or litigation, provided that all
out of pocket expenses of Employee reasonably incurred in connection with such
assistance are fully and promptly reimbursed and that any such assistance after
the Non-Compete Period (as defined below) shall not interfere or conflict with
the obligations which Employee may owe to any other employer.
ARTICLE 4: OWNERSHIP AND PROTECTION OF INTELLECTUAL PROPERTY AND CONFIDENTIAL
INFORMATION:
4.1 All information, ideas, concepts, improvements, innovations,
developments, methods, processes, designs, analyses, drawings, reports,
discoveries, and inventions, whether patentable or not or reduced to practice,
which are conceived, made, developed or acquired by Employee, individually or in
conjunction with others, during Employee's employment by Employer or any of the
Employer Entities, both before and after the date hereof (whether during
business hours or otherwise and whether on Employer's premises or otherwise)
which relate to the business, products or services of Employer or the Employer
Entities (including, without limitation, all such information relating to
corporate opportunities, research, financial and sales data, pricing and trading
terms, evaluations, opinions, interpretations, acquisition prospects, the
identity of customers or their requirements, the identity of key contacts within
the customer's organizations or within the organization of acquisition
prospects, or marketing and merchandising techniques, prospective names, marks,
and any copyrightable work, trade xxxx, trade secret or other intellectual
property rights (whether or not composing confidential information, and all
writings or materials of any type embodying any of such items (collectively,
"Work Product"), shall be the sole and exclusive property of Employer or an
Employer Entity, as the case may be, and shall be treated as "work for hire." It
is recognized that Employee is an experienced executive in the business of the
Employer Entities and through several decades of prior work in the industry
acquired and retains knowledge, contacts, and information which are not bound by
this Article 4.
4.2 Employee shall promptly and fully disclose all Work Product to Employer
and shall cooperate and perform all actions reasonably requested by Employer
(whether during or after the Term of employment) to establish, confirm and
protect Employer's and/or Employer
12
Entities' right, title and interest in such Work Product. Without limiting the
generality of the foregoing, Employee agrees to assist Employer, at Employer's
expense, to secure Employer's and Employer Entities' rights in the Work Product
in any and all countries, including the execution by Employee of all
applications and all other instruments and documents which Employer and/or the
Employer Entities shall deem necessary in order to apply for and obtain rights
in such Work Product and in order to assign and convey to Employer and/or the
Employer Entities the sole and exclusive right, title and interest in and to
such Work Product. If Employer is unable because of Employee's mental or
physical incapacity or for any other reason (including Employee's refusal to do
so after request therefor is made by Employer) to secure Employee's signature to
apply for or to pursue any application for any United States or foreign patents
or copyright registrations covering Work Product belonging to or assigned to
Employer and/or the Employer Entities pursuant to Section 4.1 above, then
Employee by this Agreement irrevocably designates and appoints Employer and its
duly authorized officers and agents as Employee's agent and attorney-in-fact to
act for and in Employee's behalf and stead to execute and file any such
applications and to do all other lawfully permitted acts to further the
prosecution and issuance of patents or copyright registrations thereon with the
same legal force and effect as if executed by Employee. Employee agrees not to
apply for or pursue any application for any United States or foreign patents or
copyright registrations covering any Work Product other than pursuant to this
Section in circumstances where such patents or copyright registrations are or
have been or are required to be assigned to Employer or any Employer Entity.
4.3 Employee acknowledges that the businesses of Employer and the Employer
Entities are highly competitive and that their strategies, methods, books,
records, and documents, their technical information concerning their products,
equipment, services, and processes, procurement procedures and pricing
techniques, the names of and other information (such as credit and financial
data) concerning their former, present or prospective customers and business
affiliates, all comprise confidential business information and trade secrets
which are valuable, special, and unique assets which Employer and/or the
Employer Entities use in their business to obtain a competitive advantage over
their competitors. Employee further acknowledges that protection of such
confidential business information and trade secrets against unauthorized
disclosure and use is of critical importance to Employer and the Employer
Entities in maintaining their competitive position. Employee acknowledges that
by reason of Employee's duties to, and association with, Employer and the
Employer Entities, Employee has had and will have access to, and has and will
become informed of, confidential business information which is a competitive
asset of Employer and the Employer Entities. Employee hereby agrees that
Employee will not, at any time during or after his employment by Employer, make
any unauthorized disclosure of any confidential business information or trade
secrets of Employer or the Employer Entities, or make any use thereof, except in
the carrying out of his employment responsibilities hereunder. Employee shall
take all necessary and appropriate steps to safeguard confidential business
information and protect it against disclosure, misappropriation, misuse, loss
and theft. Confidential business information shall not include information in
the public domain (but only if the same becomes part of the public domain
through a means other than a disclosure prohibited hereunder). The above
notwithstanding, a disclosure shall not be unauthorized if (i) it is required by
law or by a court of competent jurisdiction or (ii) it is in connection with any
judicial, arbitration, dispute resolution or other legal proceeding in which
Employee's legal rights and obligations as an employee or under this Agreement
are at issue; provided, however, that Employee shall, to the extent practicable
and lawful in any such events, give prior notice to
13
Employer of his intent to disclose any such confidential business information in
such context so as to allow Employer or an Employer Entity an opportunity (which
Employee will not oppose) to obtain such protective orders or similar relief
with respect thereto as may be deemed appropriate. Any information not
specifically related to the Employer Entities would not be considered
confidential to the Employer.
4.4 All written materials, records, and other documents made by, or coming
into the possession of, Employee during the period of Employee's employment by
Employer which contain or disclose confidential business information or trade
secrets of Employer or the Employer Entities, or which relate to Employee's Work
Product described in Section 4.1 above, shall be and remain the property of
Employer, or the Employer Entities, as the case may be. Upon termination of
Employee's employment, for any reason, Employee promptly shall deliver the same,
and all copies thereof, to Employer.
ARTICLE 5: COVENANT NOT TO COMPETE:
5.1 In consideration of the compensation to be paid to Employee under this
Agreement, Employee acknowledges that in the course of Employee's employment
with certain Employer Entities, he has prior to the date of this Agreement, and
will during the Term of employment, become familiar with Employer's and the
Employer Entities' trade secrets, business plans and business strategies and
with other confidential business information concerning Employer and the
Employer Entities and that Employee's services have been and shall be of
special, unique and extraordinary value to Employer and the Employer Entities.
Employee also acknowledges that in the course of his employment he will have
access to Employer's and the Employer Entities' relationships and goodwill with
their customers, distributors, suppliers and employees. In light of Employee's
value to, and knowledge of, Employer, the Employer Entities, and the Business
(as defined below) and Employee's compensation pursuant to this Agreement,
Employee agrees that, during the Term and for a period of one (1) year
thereafter (the "Non-Compete Period"), he will not, in association with or as an
officer, principal, manager, member, advisor, agent, partner, director, material
stockholder, employee or consultant of any corporation (or sub-unit, in the case
of a diversified business) or other enterprise, entity or association, work on
the acquisition or development of, or engage in any line of business, property
or project which is, directly or indirectly, competitive with any business that
Employer or any Employer Entity engages in or is planning to engage in during
the Term of employment, including but not limited to, the mining, processing,
transportation, distribution, trading and sale of synfuel, coal and coal
byproducts (the "Business"). Such restriction shall cover Employee's activities
anywhere in the contiguous United States.
5.2 During the applicable Non-Compete Period, Employee will not solicit or
induce any person who is or was employed by any of the Employer Entities at any
time during such term or period (i) to interfere with the activities or
businesses of Employer or any Employer Entity or (ii) to discontinue his or her
employment with any of the Employer Entities.
5.3 During the applicable Non-Compete Period, Employee will not, directly
or indirectly, influence or attempt to influence any customers, distributors or
suppliers of any of the Employer Entities to divert their business to any
competitor of Employer or any Employer Entity or in any way interfere with the
relationship between any such customer, distributor or supplier
14
and Employer and/or any Employer Entity (including, without limitation, making
any negative statements or communications about Employer and the Employer
Entities). During the applicable Non-Compete Period, Employee will not, directly
or indirectly, acquire or attempt to acquire any business in the contiguous
United States to which Employer or any Employer Entity, prior to the termination
of the Term of employment, has made an acquisition proposal relating to the
possible acquisition of such business by Employer or any Employer Entity, or has
planned, discussed or contemplated making such an acquisition proposal (such
business, an "Acquisition Target"), or take any action to induce or attempt to
induce any Acquisition Target to consummate any acquisition, investment or other
similar transaction with any person other than Employer or any Employer Entity.
5.4 Employee understands that the provisions of Sections 5.1, 5.2 and 5.3
hereof may limit his ability to earn a livelihood in a business in which he is
involved, but as a member of the management group of Employer and the Employer
Entities he nevertheless agrees and hereby acknowledges that: (i) such
provisions do not impose a greater restraint than is necessary to protect the
goodwill or other business interests of Employer and any of the Employer
Entities; (ii) such provisions contain reasonable limitations as to time, scope
of activity, and geographical area to be restrained; and (iii) the consideration
provided hereunder, including without limitation, any amounts or benefits
provided under Article 3 hereof, is sufficient to compensate Employee for the
restrictions contained in Sections 5.1, 5.2 and 5.3 hereof. In consideration of
the foregoing and in light of Employee's education, skills and abilities,
Employee agrees that he will not assert that, and it should not be considered
that, any provisions of Sections 5.1, 5.2 or 5.3 otherwise are void, voidable or
unenforceable or should be voided or held unenforceable.
5.5 If, at the time of enforcement of Articles 4 or 5 of this Agreement, a
court shall hold that the duration, scope, or area restrictions stated herein
are unreasonable under circumstances then existing, the parties hereto agree
that the maximum period, scope or geographical area reasonable under such
circumstances shall be substituted for the stated period, scope or area and that
the court shall be allowed and directed to revise the restrictions contained
herein to cover the maximum period, scope and area permitted by law. Employee
acknowledges that he is a member of Employer's and the Employer Entities'
management group with access to Employer's and Employer Entities' confidential
business information and his services are unique to Employer and the Employer
Entities. Employee therefore agrees that the remedy at law for any breach by him
of any of the covenants and agreements set forth in Articles 4 and 5 will be
inadequate and that in the event of any such breach, Employer and the Employer
Entities may, in addition to the other remedies which may be available to them
at law, apply to any court of competent jurisdiction to obtain specific
performance and/or injunctive relief prohibiting Employee (together with all
those persons associated with him) from the breach of such covenants and
agreements and to enforce, or prevent any violations of, the provisions of this
Agreement. In addition, in the event of a breach or violation by Employee of
this Article 5, the applicable Non-Compete Period set forth in this Article
shall be tolled until such breach or violation has been cured.
5.6 Each of the covenants of this Article 5 are given by Employee as part
of the consideration for this Agreement and as an inducement to Employer to
enter into this Agreement and accept the obligations hereunder.
15
5.7 Provisions of Article 5 shall not be binding on Employee if Employer
fails to perform any material obligation under this Agreement, including,
without limitation, the failure of Employer to make timely payments of monies
due to Employee under Article 3 of this Agreement; provided, that (a) Employee
has notified Employer in writing within 30 days of the date of the failure of
Employer to perform such material obligation and (b) such failure remains
uncorrected and/or uncontested by Employer for 15 days following the date of
such notice.
5.8 Notwithstanding anything to the contrary contained in this Article 5,
the provisions of this Article 5 shall not apply in the event that this
Agreement shall be terminated by Employee for Good Reason pursuant to Section
3.4 or Employee or Employer, as the case may be, elects not to renew the Term of
this Agreement pursuant to Section 3.2(iv) or Section 3.4(ii), respectively,
provided that Employee does not receive, or does not elect to receive, any of
the benefits or payments under Sections 3.5, 3.8 and/or 3.10 of this Agreement.
ARTICLE 6: CERTAIN ADDITIONAL PAYMENTS BY EMPLOYER:
6.1 The provisions of this Article 6 shall apply notwithstanding anything
in this Agreement to the contrary. Subject to Section 6.2 below, in the event
that it shall be determined that any payment or distribution by Employer to, or
for the benefit of, the Employee, whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise (a
"Payment"), would constitute an "excess parachute payment" within the meaning of
Section 280G of the Code, Employer shall pay the Employee an additional amount
(the "Gross-Up Payment") such that the net amount retained by the Employee after
deduction of any excise tax imposed under Section 4999 of the Code, and any
federal, state and local income tax, employment tax, excise tax and other tax
imposed upon the Gross-Up Payment, shall be equal to the Payment.
6.2 Notwithstanding Section 6.1, and notwithstanding any other provisions
of this Agreement to the contrary, if the net after-tax benefit to the Employee
of receiving the Gross-Up Payment does not exceed the Safe Harbor Amount (as
defined below) by more than 10% (as compared to the net-after tax benefit to the
Employee resulting from elimination of the Gross-Up Payment and reduction of the
Payments to the Safe Harbor Amount), then (i) Employer shall not pay the
Employee the Gross-Up Payment, and (ii) the provisions of Section 6.3 below
shall apply. The term "Safe Harbor Amount" means the maximum dollar amount of
parachute payments that may be paid to the Employee under Section 280G of the
Code without imposition of an excise tax under Section 4999 of the Code.
6.3 The provisions of this Section 6.3 shall apply only if Employer is not
required to pay the Employee a Gross-Up Payment as a result of Section 6.2
above. If Employer is not required to pay the Employee a Gross-Up Payment as a
result of the provisions of Section 6.2, Employer will apply a limitation on the
Payment amount as set forth below (a "Parachute Cap") as follows: The aggregate
present value of the Payments under Section 3.8 and Section 3.10 of this
Agreement ("Agreement Payments") shall be reduced (but not below zero) to the
Reduced Amount. The "Reduced Amount" shall be an amount expressed in present
value which maximizes the aggregate present value of Agreement Payments without
causing any Payment to be subject to the limitation of deduction under Section
280G of the Code. For purposes of this
16
Article 6, "present value" shall be determined in accordance with Section
280G(d)(4) of the Code.
6.4 Except as set forth in the next sentence, all determinations to be made
under this Article 6 shall be made by the nationally recognized independent
public accounting firm used by Employer immediately prior to the Change in
Control ("Accounting Firm"), which Accounting Firm shall provide its
determinations and any supporting calculations to Employer and the Employee
within ten (10) days of the Employee's termination date. The value of the
Employee's non-competition covenant under Article 5 of this Agreement shall be
determined by independent appraisal by a nationally-recognized business
valuation firm acceptable to both the Employee and Employer, and a portion of
the Agreement Payments shall, to the extent of that appraised value, be
specifically allocated as reasonable compensation for such non-competition
covenant and shall not be treated as a parachute payment. If any Gross-Up
Payment is required to be made, Employer shall make the Gross-Up Payment within
60 days after receiving the Accounting Firm's calculations unless Employer
determines that such compensation is subject to Section 409A of the Code in
which case it shall be paid to Employee on the Six Month Payment Date. Any such
determination by the Accounting Firm shall be binding upon Employer and the
Employee.
6.5 All of the fees and expenses of the Accounting Firm in performing the
determinations referred to in this Article 6 shall be borne solely by Employer.
ARTICLE 7: MISCELLANEOUS:
7.1 For purposes of this Agreement, the terms "affiliate" or "affiliates"
mean an entity or entities in which Employer or any other person has a 20% or
more direct or indirect equity interest or entity or entities that have a 20% or
more direct or indirect equity interest in Employer or such other person.
7.2 Employer shall, to the extent necessary, modify the timing of delivery
of compensation and/or benefits to Employee if it is determined that the timing
would result in the additional tax and/or interest and/or penalties assessed to
Employee under Section 409A of the Code.
7.3 For purposes of this Agreement, notices and all other communications
provided for herein shall be in writing and shall be deemed to have been duly
given when received by or tendered to Employee or Employer, as applicable, by
pre-paid courier or by United States registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:
17
If to Employer:
Alpha Natural Resources Services, LLC
Xxx Xxxxx Xxxxx
X.X. Xxx 0000 Xxxxxxxx, XX 00000
Attn: General Counsel of Alpha Natural Resources
If to Employee: To his last known personal residence
7.4 This Agreement shall be governed by and construed and enforced, in all
respects in accordance with; the law of the Commonwealth of Virginia, without
regard to principles of conflicts of law, unless preempted by federal law, in
which case federal law shall govern; provided, however, that Employer's Dispute
Resolution Plan, or if no such plan is in place, then the rules of the American
Arbitration Association shall govern in all respects with regard to the
resolution of disputes hereunder as provided in Section 7.7.
7.5 No failure by either party hereto at any time to give notice of any
breach by the other party of, or to require compliance with, any condition or
provision of this Agreement shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time.
7.6 It is a desire and intent of the parties that the term, provisions,
covenants, and remedies contained in this Agreement shall be enforceable to the
fullest extent permitted by law. If any such term, provision, covenant, or
remedy of this Agreement or the application thereof to any person, association,
or entity or circumstances shall, to any extent, be construed to be invalid or
unenforceable in whole or in part, then such term, provision, covenant, or
remedy shall be construed in a manner so as to permit its enforceability under
applicable law to the fullest extent permitted by law. In any case, the
remaining provisions of this Agreement or the application thereof to any person,
association, or entity or circumstances other than those to which they have been
held invalid or unenforceable, shall remain in full force and effect.
7.7 It is the mutual intention of the parties to have any dispute
concerning this Agreement resolved out of court. Accordingly, the parties agree
that any such dispute shall, as the sole and exclusive remedy, be submitted for
resolution through Employer's Dispute Resolution Plan or, if no such plan is in
place, then pursuant to binding arbitration to be held in Abingdon, Virginia, in
accordance with the employment arbitration rules (except as modified below) of
the American Arbitration Association and with the Expedited Procedures thereof
(collectively, the "Rules"); provided, however, that the Employer, on its own
behalf and on behalf of any of the Employer Entities, and the Employers Entities
shall be entitled to seek a restraining order or injunction in any court of
competent jurisdiction to prevent any breach or the continuation of any breach
of the provisions of Articles 4 and 5 and Employee hereby consents that such
restraining order or injunction may be granted without the necessity of the
Employer or any Employer Entity posting any bond. Each of the parties hereto
agrees that such arbitration shall be conducted by a single arbitrator selected
in accordance with the Rules; provided that such arbitrator shall be experienced
in deciding cases concerning the matter which is the subject of the dispute.
Each of the parties agrees that in any such arbitration that pre-arbitration
18
discovery shall be limited to the greatest extent provided by the Rules, that
the award shall be made in writing no more than 30 days following the end of the
proceeding, that the arbitration shall not be conducted as a class action, that
the arbitration award shall not include factual findings or conclusions of law.
Any award rendered by the arbitrator shall be final and binding and judgment may
be entered on it in any court of competent jurisdiction. Each of the parties
hereto agrees to treat as confidential the results of any arbitration
(including, without limitation, any findings of fact and/or law made by the
arbitrator) and not to disclose such results to any unauthorized person.
7.8 This Agreement shall be binding upon and inure to the benefit of
Employer, the Employer Entities, their respective successors in interest, or any
other person, association, or entity which may hereafter acquire or succeed to
all or substantially all of the business assets of Employer and the Employer
Entities by any means, whether indirectly or directly, and whether by purchase,
merger, consolidation, or otherwise. Employee's rights and obligations under
this Agreement are personal and such rights, benefits, and obligations of
Employee shall not be voluntarily or involuntarily assigned, alienated, or
transferred, whether by operation of law or otherwise, without the prior written
consent of Employer, other than in the case of death or Permanent Disability of
Employee.
7.9 This Agreement replaces and merges any previous agreements and
discussions pertaining to the subject matter covered herein including, without
limitation, the Second Amended and Restated Agreement. This Agreement
constitutes the entire agreement of the parties with regard to the terms of
Employee's employment, termination of employment and severance benefits, and
contains all of the covenants, promises, representations, warranties, and
agreements between the parties with respect to such matters. Each party to this
Agreement acknowledges that no representation, inducement, promise, or
agreement, oral or written, has been made by either party with respect to the
foregoing matters which is not embodied herein, and that no agreement,
statement, or promise relating to the employment of Employee by Employer that is
not contained in this Agreement shall be valid or binding. Any modification of
this Agreement will be effective only if it is in writing and signed by each
party whose rights hereunder are affected thereby.
7.10 Notwithstanding any provision of this Agreement to the contrary, the
parties' respective rights and obligations under Articles 3, 4, 5, 6, and this
Article 7 will survive any termination or expiration of this Agreement or the
termination of Employee's employment for any reason whatsoever.
7.11 The invalidity or unenforceability of any provision or provisions of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.
7.12 This Agreement may be executed in one or more counterparts, each of
which shall deemed to be in an original but all of which together will
constitute one and the same instrument.
[SIGNATURE PAGE FOLLOWS]
19
IN WITNESS WHEREOF, Employer and Employee have duly executed this Agreement
in multiple originals to be effective as of the Effective Date.
EMPLOYER
ALPHA NATURAL RESOURCES SERVICES, LLC
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
EMPLOYEE
/s/ Xxxxxxx X. Xxxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxxx
20
ANNEX A
SEPARATION OF EMPLOYMENT AGREEMENT AND GENERAL RELEASE
THIS SEPARATION OF EMPLOYMENT AGREEMENT AND GENERAL RELEASE (the
"Agreement") is made as of this _____ day of ___________, _____, by and between
Alpha Natural Resources Services, LLC (the "Company") and Xxxxxxx X. Xxxxxxx
("Executive").
WHEREAS, the Executive formerly was employed by the Company as
____________; and
WHEREAS, the Company employs Executive pursuant to the terms and conditions
set forth in that certain Employment Agreement dated as of January 1, 2003
between Executive and Alpha Natural Resources, LLC, that was assigned to the
Company as of December 31, 2003, amended and restated March 31, 2004, further
amended and restated as of January 28, 2005, and further amended and restated
effective as of January 1, 2006 (as amended from time to time, the "Employment
Agreement") which provides for certain payments and benefits in the event that
the Executive's employment is terminated under certain circumstances; and
WHEREAS, an express condition of the Executive's entitlement to the
payments and benefits under the Employment Agreement is the execution of a
general release in the form set forth below; and
WHEREAS, the Executive and the Company mutually desire to terminate the
Executive's employment effective _____________ ____, ____ ("Date of
Termination").
NOW, THEREFORE, IT IS HEREBY AGREED by and between the Executive and the
Company as follows:
1. (a) The Executive, for and in consideration of the commitments of the
Company as set forth in paragraph 5 of this Agreement, and intending to be
legally bound, does hereby REMISE, RELEASE AND FOREVER DISCHARGE the Company,
its affiliates, predecessors, subsidiaries and parents, and their present or
former officers, directors, shareholders, employees, 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 the Company
(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 employment relationship with the
Company, the terms and conditions of that employment relationship, and the
termination of that 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 Family and Medical Leave Act of 1993, the Employee
Retirement Income Security Act of 1974, 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. 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 paragraph 10 and paragraph 12 below, 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 the Company
or 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 the Company or 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 the Company or any Releasee, to any member of the
Company's or 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 the Company'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 Company or Releasees.
2. In consideration of the Company's agreements as set forth in paragraph 5
herein, the Executive agrees to comply with the limitations described in Article
5 of the Employment Agreement.
3. The Executive further agrees and recognizes that the Executive has
permanently and irrevocably severed the Executive's employment relationship with
the Company, that the Executive shall not seek employment with the Company or
any affiliated entity at any time in the future, and that the Company has no
obligation to employ him in the future.
4. The Executive further agrees that the Executive will not disparage or
subvert the Company or any Releasee, or make any statement reflecting negatively
on the Company, its affiliated corporations or entities, or any of their
officers, directors, employees, agents or representatives, including, but not
limited to, any matters relating to the operation or management of the Company
or any Releasee, the Executive's employment and the termination of the
Executive's employment, irrespective of the truthfulness or falsity of such
statement.
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5. In consideration for the Executive's promises, as set forth herein, the
Company agrees to pay or provide to or for the Executive the payments and
benefits described in the Employment Agreement, the provisions of which are
incorporated herein by reference. Except as set forth in this 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 paragraph,
or those required by law, other than under the terms of any benefit plans which
provide benefits or payments to former employees according to their terms.
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. The Executive acknowledges that
if the Executive had not executed this Agreement containing a release of all
claims against the Releasees, the Executive would not have been entitled to the
payments and benefits set forth in the Employment Agreement.
7. The Executive acknowledges and agrees that this Agreement and the
Employment Agreement supersede any employment agreement or offer letter the
Executive has with the Company or any Releasee. To the extent Executive has
entered into any other enforceable written agreement with the Company or any
Releasee that contains provisions that are outside the scope of this Agreement
and the Employment Agreement and are not in direct conflict with the provisions
in this Agreement or the Employment Agreement, the terms in this Agreement and
the Employment Agreement shall not supercede, but shall be in addition to, any
other such agreement. Except as set forth expressly herein, no promises or
representations have been made to Executive in connection with the termination
of the Executive's Employment Agreement, if any, or offer letter, if any, with
the Company, or the terms of this Agreement.
8. The Executive agrees not to disclose the terms of this Agreement or the
Employment Agreement to anyone, except the Executive's spouse, attorney and, as
necessary, tax/financial advisor. It is expressly understood that any violation
of the confidentiality obligation imposed hereunder constitutes a material
breach of this Agreement.
9. The Executive represents that the Executive does not, without the
Company's prior written consent, presently have in the Executive's possession
any records and business documents, whether on computer or hard copy, and other
materials (including but not limited to computer disks and tapes, computer
programs and software, office keys, correspondence, files, customer lists,
technical information, customer information, pricing information, business
strategies and plans, sales records and all copies thereof) (collectively, the
"Corporate Records") provided by the Company and/or its predecessors,
subsidiaries or affiliates or obtained as a result of the Executive's prior
employment with the Company and/or its predecessors, subsidiaries or affiliates,
or created by the Executive while employed by or rendering services to the
Company and/or its predecessors, subsidiaries or affiliates. The Executive
acknowledges that all such Corporate Records are the property of the Company. In
addition, the Executive shall promptly return in good condition any and all
Company owned equipment or property, including, but not limited to, automobiles,
personal data assistants, facsimile machines, copy machines, pagers, credit
cards, cellular telephone equipment, business cards, laptops, computers, and any
other items requested by the Company. As of the Date of Termination, the Company
will make
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arrangements to remove, terminate or transfer any and all business communication
lines including network access, cellular phone, fax line and other business
numbers.
10. 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 the Company'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.
11. The parties agree and acknowledge that the agreement by the Company
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.
12. The Executive agrees and recognizes that should the Executive breach
any of the obligations or covenants set forth in this Agreement, the Company
will have no further obligation to provide the Executive with the consideration
set forth herein, and will have the right to seek repayment of all consideration
paid up to the time of any such breach. Further, the Executive acknowledges in
the event of a breach of this Agreement, Releasees may seek any and all
appropriate relief for any such breach, including equitable relief and/or money
damages, attorneys' fees and costs. Notwithstanding the foregoing, in the event
the Company fails to perform any material obligation under the Employment
Agreement, including, without limitation, the failure of the Company to make
timely payments of monies due to Executive under Article 3 of the Employment
Agreement, this Release shall be null and void and 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) Executive has
notified the Company in writing within 30 days of the date of the failure of the
Company to perform such material obligation and (ii) such failure remains
uncorrected and/or uncontested by the Company for 15 days following the date of
such notice.
13. The Executive further agrees that the Company shall be entitled to
preliminary and permanent injunctive relief, without the necessity of proving
actual damages, as well as to an equitable accounting of all earnings, profits
and other benefits arising from any violations of this Agreement, which rights
shall be cumulative and in addition to any other rights or remedies to which the
Company may be entitled.
14. This Agreement and the obligations of the parties hereunder shall be
construed, interpreted and enforced in accordance with the laws of the
Commonwealth of Virginia.
15. The parties agree that this Agreement shall be deemed to have been made
and entered into in Abingdon, Virginia. Jurisdiction and venue in any proceeding
by the Company or Executive to enforce their rights hereunder is specifically
limited to any court geographically located in Virginia.
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16. 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 the
Company and the termination of that employment relationship; 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 the Company has provided Executive with a period of
[twenty-one (21)] or [forty-five (45)] days within which to consider this
Agreement, and that the Executive has signed on the date indicated below after
concluding that this Separation of Employment Agreement and General Release 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 the Company will have no obligations hereunder.
[SIGNATURE PAGE FOLLOWS]
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Intending to be legally bound hereby, the Executive and the Company
executed the foregoing Separation of Employment Agreement and General Release
this ______ day of ______________, _____.
Witness:
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XXXXXXX X. XXXXXXX
ALPHA NATURAL RESOURCES SERVICES, LLC
By: Witness:
--------------------------------- -------------------------------
Name:
-------------------------------
Title:
------------------------------
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