AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT ENTERED INTO AS OF DECEMBER 1, 1993 AMONG GRAHAM CORPORATION, GRAHAM MANUFACTURING CO., INC. AND JAMES R. LINES
Exhibit 10.6
AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT
ENTERED INTO AS OF DECEMBER 1, 1993 AMONG ▇▇▇▇▇▇ CORPORATION,
GRAHAM MANUFACTURING CO., INC. AND ▇▇▇▇▇ ▇. LINES
ENTERED INTO AS OF DECEMBER 1, 1993 AMONG ▇▇▇▇▇▇ CORPORATION,
GRAHAM MANUFACTURING CO., INC. AND ▇▇▇▇▇ ▇. LINES
THIS AMENDMENT, is made and entered into as of September 26, 1996, by and among ▇▇▇▇▇▇
Corporation, a Delaware corporation with offices at ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
(the “Holding Company”), ▇▇▇▇▇▇ Manufacturing Co., Inc., a New York corporation with offices at ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (“GMC”), and ▇▇▇▇▇ ▇. Lines currently residing at ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the “Executive”).
WITNESSETH
WHEREAS, the Holding Company and GMC have entered into an Employment Agreement with the
Executive entered into as of December 1, 1993 (the “Employment Agreement”); and
WHEREAS, the Holding Company, GMC and the Executive wish to amend certain provisions of the
Employment Agreement;
NOW, THEREFORE, the Holding Company, GMC and the Executive, intending to be legally bound
hereby, agree as follows:
1. The final sentence of Section 2 of the Employment Agreement be and hereby is amended to
read in its entirety as follows:
“The Executive shall devote his full time during GMC’s hours of work to the business
and affairs of GMC and shall use his best efforts, skill and ability in performing
his duties on behalf of GMC.”
2. Section 4 of the Employment Agreement be and hereby is amended to read in its entirety as
follows:
“4. Base Compensation. As the base compensation for all services to be
rendered by the Executive in any capacity to GMC and its affiliates, GMC agrees to
pay to the Executive, and the Executive shall accept, a salary at a rate of $104,354
per annum, payable in arrears in equal monthly installments, subject to such
deductions and withholdings as may be required by law. During the fourth quarter of
each year, GMC will review the salary rate of the Executive, taking into
consideration such factors as the Executive’s performance during the preceding year
and such other matters as it deems relevant and, in its sole discretion, may
increase the salary of the Executive for the following calendar year, to be
effective from January 1 of such following year, to such rate and for such period of
time as GMC deems proper, provided that GMC shall in no event be required to grant
any such increase. However, in the event that any person or entity acquires twenty
percent (20%) or more of the outstanding equity stock of the Holding Company or GMC,
who was not an owner of twenty percent of the equity stock of either the Holding
Company (in the case of an acquisition of Holding Company stock) or GMC (in the case
of an acquisition of GMC stock) prior to December 1, 1993, or in the event that any
person
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or entity acquires twenty percent (20%) or more of the assets of either the Holding
Company or GMC who was not an owner of twenty percent of the assets of either the
Holding Company (in the case of an acquisition of Holding Company assets) or of GMC
(in the case of an acquisition of GMC assets) prior to December 1, 1993 then,
subsequent to such acquisition of twenty percent stock or twenty percent asset
ownership of either the Holding Company or GMC by any such person or entity: (1) if
for any calendar year a salary increase at least equal to the increase in the U.S.
City All-Items Consumer Price Index for Urban Wage Earners and Clerical Workers
during the previous twelve months, is not granted; or if (2) the Executive’s base
salary is decreased at any time, then in either event the Executive may in his sole
discretion terminate this Agreement upon thirty days’ written notice given at any
time during the calendar year for which no such increase was granted, or during the
twelve month period following any such decrease in salary, and thereupon GMC shall
be obligated to pay the Executive the amounts, and provide the benefits, specified
in Section 9.3 of this Agreement.”
3. Section 5 of the Employment Agreement be and hereby is amended by replacing the words “The
Executive Bonus Plan” with the words “The Incentive Compensation Plan (formerly the Executive Bonus
Plan)”.
4. Section 7 of the Employment Agreement be and hereby is amended to read in its entirety as
follows:
“7. Automobile Allowance.”
“7.1 GMC shall pay the Executive an automobile allowance of $8,550 per annum (the
“Automobile Allowance”). Neither the Automobile Allowance nor any portion of it
shall be included as Base Compensation for the purpose of eligibility for possible
increases in Base Compensation as provided by Section 4 of this Agreement. During
the fourth quarter of each calendar year, GMC will review the automobile allowance
amount of the Executive and, in its discretion, may increase the automobile
allowance paid to the Executive for the following calendar year, to be effective
from January 1 of the following year, to such increased rate and for such period of
time as GMC deems proper, provided that GMC shall not be required to grant any such
increase.”
“7.2 The Executive represents that he now carries automobile liability insurance,
with respect to any automobile owned by him, for injuries to persons and property.”
5. Section 9.3 of the Employment Agreement be and hereby is amended by deleting subsection (c)
of the fourth sentence.
6. Section 9.3 of the Employment Agreement be and hereby is further amended by deleting the
last sentence and adding the following sentences:
“In addition to other amounts payable to the Executive under this Section 9.3, the
Holding Company and GMC shall pay to the Executive Accrued Bonus as defined
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hereinafter. For purposes of this Section 9.3, Accrued Bonus shall mean any amount
of bonus with respect to any year prior to the year in which dismissal without cause
occurs (“Prior Bonus Year”) calculable by applying the formula prescribed by the
Incentive Compensation Plan (formerly the Executive Bonus Plan) of ▇▇▇▇▇▇
Corporation as it existed on December 31 of such Prior Bonus Year and employing in
the application of such formula the goals, ratios and weighting percentages and
other variable figures which the Bonus Plan calls for the Holding Company’s Board or
any Committee thereof to determine annually (“Bonus Plan Variables”) which the
Holding Company’s Board of Directors or any Committee thereof adopted for purposes
of the Bonus Plan prior to December 31 of such Prior Bonus Year. With respect to any
Prior Bonus Year for which neither the Holding Company’s Board nor any Committee
thereof adopted Bonus Plan Variables prior to December 31 of such year, the Bonus
Plan Variables adopted most recently prior to the commencement of the Prior Bonus
Year in issue shall be employed for purposes of calculating the amount of Accrued
Bonus payable pursuant to this Agreement. Notwithstanding any other provision of
this Section, no Accrued Bonus shall be payable pursuant to Section 9.3 of this
Agreement for any Prior Bonus Year with respect to which a bonus amount was paid to
and accepted by the Executive. In the event that the provisions of this Section 9.3
are triggered by discharge of the Executive without cause by GMC, the Executive
shall resign from all offices and directorships of the other entity and of all
subsidiaries and affiliates of the Holding Company, upon payment to the Executive of
the amount referred to in subsection (a) of the second sentence of this Section 9.3,
payment of the amount referred to in subsection (b) of the second sentence of this
Section 9.3 (or the first installment thereof) and Accrued Bonus, if any.”
7. The Employment Agreement be and hereby is amended by adding the following section:
“9.5 Non-duplication. In the event that the Executive shall be a party to
any other contract, agreement or arrangement providing termination payments (other
than retirement or similar benefits or pursuant to any plan providing for stock
options or appreciation rights) upon a cessation of service for GMC, any
compensation or other benefits provided to the Executive under such other contract,
agreement or arrangement and paid to the Executive shall be applied to offset the
obligations of GMC to pay a lump sum equal to twelve months’ salary as provided by
Section 9.3 hereof, it being intended that such lump sum payment provided under
Section 9.3 hereof not duplicate payments otherwise due to the Executive on account
of his cessation of service.”
8. Section 16 of the Employment Agreement be and hereby is amended by adding the following
sentence:
“Any action or proceeding brought by either party against the other arising out of
or related to the Agreement shall be brought only in a state court of competent
jurisdiction located in the County of Erie, State of New York or the Federal
District
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Court for the Western District of New York located in Erie County, New York
and the parties hereby consent to the personal jurisdiction of said courts.”
9. All other terms and conditions of the Employment Agreement remain unchanged and in full
force and effect.
IN WITNESS WHEREOF, the parties hereto have duly executed this agreement as of the day and
year first above written.
| (Corporate Seal) | ▇▇▇▇▇▇ CORPORATION | |||
| By: | ||||
| (Corporate Seal) | ▇▇▇▇▇▇ MANUFACTURING CO., INC. | |||
| By: | ||||
Attest: |
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STATE OF NEW YORK
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| : ss.: | ||
COUNTY OF GENESEE
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On the 26 day of September, 1996, before me personally came F. D. Berkeley, to me known, who,
being by me duly sworn, did depose and say that he resides at ▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇; that he is Chairman, President and Chief Executive Officer of ▇▇▇▇▇▇ Corporation described in
and which executed the attached instrument; that he knows the seal of said corporation and that the
seal affixed to said instrument is such corporate seal; that it was so affixed by authorizations of
the Board of Directors of said corporation, and that he signed his name thereto by like authority.
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▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇
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| : ss.: | ||
COUNTY OF GENESEE
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On the 27th day of September, 1996, before me personally came ▇▇▇▇▇▇ ▇▇▇▇▇▇, to me
known, who, being by me duly sworn, did depose and say that he resides at ▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇; that he is President of ▇▇▇▇▇▇ Manufacturing Co., Inc. described in and which
executed the attached instrument; that he knows the seal of said corporation and that the seal
affixed to said instrument is such corporate seal; that it was so affixed by authorizations of the
Board of Directors of said corporation, and that he signed his name thereto by like authority.
STATE OF NEW YORK
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| : ss.: | ||
COUNTY OF GENESEE
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On the 22nd day of October, 1996, before me personally came ▇▇▇▇▇ ▇. Lines, to me
known to be the person described in and who executed the attached instrument and acknowledged that
he executed the same.