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EXHIBIT (10)(a)
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT is made and entered into
as of the 1st day of June, 2000, by and between each of LACLEDE STEEL COMPANY,
debtor in possession, a Delaware corporation ("Laclede Steel"), LACLEDE CHAIN
MANUFACTURING CO., debtor in possession, a Delaware corporation ("Laclede
Chain") and LACLEDE MID-AMERICA, INC., debtor in possession, an Indiana
corporation ("Laclede Mid America") (collectively "Employer"), and XXXXXXX X.
XXXX ("Employee").
WHEREAS, Employee and Employer previously entered into an employment
agreement as of the 30th day of July, 1996 which was further amended on March
24, 1998, July 29, 1998 and January 13, 1999 (the "Original Employment
Agreement"); and
WHEREAS, Employee and Employer desire to amend and restate the Original
Employment Agreement in its entirety, pursuant to this Amended and Restated
Employment Agreement; and
WHEREAS, Employee desires to be employed by Employer and Employer
desires to employ Employee under the terms and conditions set forth in this
Amended and Restated Employment Agreement; and
WHEREAS, it is Employer's intention to employ Employee upon the terms
and conditions herein, which recognize and compensate Employee for the
obligations of Employee undertaken hereunder, including specifically, but not by
way of limitation, the agreement of Employee not to compete with the business of
Employer, as provided in paragraph 9(b) (see page 8), for the period provided in
paragraph 9(a) upon the termination of Employee's employment by Employer for any
reason; it being understood and agreed that Employee is employed by Employer to
protect and expand the business of Employer;
NOW, THEREFORE, in consideration of the foregoing and the promises and
agreements herein contained, the parties agree as follows:
1. EMPLOYMENT. Employer hereby employs Employee, and Employee hereby
accepts such employment from Employer upon the terms and conditions hereinafter
set forth. This Amended and Restated Employment Agreement supersedes the
Original Employment Agreement.
2. TERM OF EMPLOYMENT. The term of Employee's employment under this
Agreement shall be for the period commencing June 1, 2000, and continuing
through December 31, 2000 (the "First Term"); provided however, that upon the
confirmation of a plan of reorganization of Laclede Steel under Chapter 11 of
the bankruptcy laws, the First Term shall automatically be extended through
December 31, 2001. Subsequent to December 31, 2001, unless earlier terminated,
this Agreement shall continue in full force and effect until either party shall
give ninety (90) days written notice of termination, in which case this
Agreement shall
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terminate on the ninetieth (90th) day following the giving of such notice to the
other party. In addition, this Agreement shall terminate on the occurrence of
any of the following events:
(a) Whenever all Employers and Employee shall mutually agree
in writing to terminate Employee's employment with all Employers;
(b) Upon the death of Employee;
(c) For "cause," which shall mean Employee's dishonesty or
unlawful acts committed in connection with the business of an Employer, and
which results in material gain or profit to Employee.
(d) At Employer's option and by action of each Employer's
Board of Directors on thirty (30) days' written notice in the event of
Employee's Disability (defined as the failure substantially to discharge
Employee's duties as defined under this Agreement for ninety (90) consecutive
days or one hundred twenty (120) days (whether or not consecutive) in any twelve
(12) month period, as a result of an injury, disease, sickness or other physical
or mental incapacity). A determination of Employee's Disability shall be made by
a qualified medical doctor licensed to practice in the State of Missouri chosen
by Employer subject to Employee's approval, which approval shall not be
unreasonably withheld. Employee shall consent to be examined by Employer's
medical doctor and shall consent to allow Employer's medical doctor to discuss
Employee's medical condition with Employer. Notwithstanding anything to the
contrary contained herein, Employee's Disability shall not be deemed to have
commenced until full coverage with respect to such Disability shall have been
approved by Employer's disability insurance carrier and payment under Employer's
group disability policy for such Disability shall have commenced.
3. TITLE AND DUTIES OF EMPLOYEE. Employee's title shall be Executive
Vice President and Chief Financial Officer of Laclede Steel, Vice President and
Chief Financial Officer of Laclede Chain and Vice President and Chief Financial
Officer of Laclede Mid America. During Employee's employment by Employer,
Employee shall serve Employer to the best of Employee's ability and shall
perform such duties as are typically performed by the Chief Financial Officer of
Employer. Employee agrees to devote Employee's time and efforts to the business
of Employer (except for usual vacations and reasonable time for attention to
personal affairs so long as Employee's performance hereunder is not adversely
affected thereby), and to be loyal and faithful at all times, constantly
endeavoring to improve Employee's ability and knowledge of the business of
Employer in an effort to increase the value of Employee's services for the
mutual benefit of Employee and Employer.
4. COMPENSATION AND BENEFITS OTHER THAN LIFE INSURANCE.
(a) Employer agrees to pay Employee for Employee's services
during the term of Employee's employment hereunder. Employee's base salary shall
be the greater of (i) an annual rate of Two Hundred Seventy-Five Thousand
Dollars ($275,000.00) or (ii) the highest annual base salary authorized by the
Board of Directors after the date hereof. Employee's
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base salary shall be due and payable in twelve (12) equal monthly installments.
Additionally, during the term of Employee's employment by Employer hereunder,
Employee's compensation shall be reviewed and may be increased and/or Employee
may be paid additional or special compensation including without limitation
stock options, stock appreciation rights and other incentive compensation, or
bonuses (based on the earnings of Employer, the performance of Employee or
otherwise) from time to time by the mutual agreement of Employee and Employer,
as determined by the Board of Directors of Employer. Without limiting the
foregoing, commencing with the fiscal year beginning October 1, 2000 Employee
shall have a bonus opportunity based upon the same bonus program to be developed
and approved by the Board of Directors for the Chief Executive Officer of
Laclede Steel except that Employee's bonus opportunity under this program shall
be twenty percent (20%) to thirty percent (30%) of Employee's base salary as
defined in this paragraph 4(a). In addition, during the term of this Agreement,
Employee shall receive such fringe benefits as are made available by Employer
from time to time to other employees of Employer at Employee's level of
employment; provided however, that benefits paid to Employee in all events shall
include Employee's leased automobile, Employee's tax assistance program and
Employee's health and disability insurance benefits.
(b) In the event of the termination of Employee's employment
either (i) by Employee for any reason including death or Disability, or (ii) by
Employer without "cause" (as defined in paragraph 2 herein), Employee shall be
paid incentive compensation for the fiscal year in which such termination
occurred in an amount equal to the product of (a) the amount of incentive
compensation to which he would have been entitled for such fiscal year had there
been no termination of employment and (b) a fraction, the numerator of which is
the number of days of such fiscal year in which Employee remained in the
employment of Employer and the denominator of which is 365.
(c) After Employee's termination of employment Employee shall
participate in the Laclede Retired Salaried Employee Medical Plan, as such plan
may be amended by Employer or any replacement plan as may exist from time to
time.
(d) After Employee's termination of employment medical
benefits now payable for the benefit of Employee's dependent daughter, Xxxxx
Xxxx, under the Laclede Salaried Employee Medical Plan, as referenced in the
attached letter from General American Life Insurance Company, shall be provided
under the Laclede Retired Salaried Employee Medical Plan, as such plan may be
amended by Employer or any replacement plan as may exist from time to time.
(e) Notwithstanding anything contained in Employee's Key
Employee Retirement Agreement with Laclede Steel (Employee's "KERP") or this
Agreement, Laclede Steel and Employee agree that on the first business day after
Employee ceases for any reason to be a full time employee of Laclede Steel
(Employee's "KERP Payment Date") Laclede Steel shall authorize in writing the
Trustee of Employee's KERP to pay to Employee in a lump sum in kind all amounts
owed to Employee pursuant to Employee's KERP. Until Employee's KERP Payment
Date, Employee shall be considered an active employee of Laclede Steel.
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5. SEVERANCE PAYMENT.
So long as Employee does not terminate Employee's employment
with Laclede Steel for at least ninety (90) days after the confirmation of a
plan of reorganization of Laclede Steel under Chapter 11 of the Federal
bankruptcy laws, then for a period of one hundred fifty (150) days after such
confirmation Employee may terminate Employee's employment with Laclede Steel on
sixty (60) days prior written notice. In such case, in addition to all other
amounts due Employee, whether under this Agreement or otherwise, Employer shall
pay to Employee on Employee's termination of employment, as severance and in a
lump sum an amount equal to Employee's annual compensation as defined in
paragraph 4(a) herein reduced by all required withholding taxes (the "Severance
Payment"). If Employee does not terminate Employee's employment prior to the end
of such period then the Severance Payment shall be paid on the later of December
31, 2001 or on Employee's subsequent termination from Laclede Steel. In the
event that the Laclede Steel Chapter 11 reorganization proceeding is converted
to a plan of liquidation under Chapter 7 of the Federal bankruptcy laws, then so
long as Employee (i) does not voluntarily terminate Employee's employment with
Laclede Steel for at least ninety (90) days and (ii) Employee gives Laclede
Steel at least sixty (30) days prior written notice of termination after such
conversion, then the Severance Payment shall be paid to Employee in a lump sum
on Employee's termination of employment with Laclede Steel.
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6. LIFE INSURANCE BENEFITS.
(a) During the term of this Agreement, Employer shall be
obligated to keep in force life insurance on the life of Employee in the amount
of Six Hundred Thousand Dollars ($600,000.00) which will consist of permanent
insurance on the life of Employee owned by Employee or his designee.
(b) In the event of the termination of Employee's employment
either (i) by Employee for any reason, or (ii) by Employer without "cause" (as
defined in paragraph 2(c) herein), Employer agrees to keep in force such
permanent life insurance set forth in subparagraph (a) of this paragraph 6 for
the duration of Employee's life. Employer may fulfill this obligation by
satisfying the premium requirement so that such permanent insurance is fully
paid under the terms of such permanent insurance policy. Employer's obligation
to pay permanent life insurance premiums under this subparagraph (b) will
survive the term of this Agreement.
(c) In the event of the termination of Employee's employment
by Employer for "cause" (as defined in paragraph 2(c) herein), then Employer's
obligation to pay premiums under this paragraph 6 will cease.
(d) Employer agrees to reimburse Employee for any tax due on
the annual permanent insurance premium paid by Employer.
(e) The amount of insurance described in subparagraph (a) may
be increased by the Board of Directors.
7. TERMINATION. In the event of the termination of Employee's
employment by Employer, without "cause" (as defined in paragraph 2(c) herein),
then, in lieu of any further salary payment pursuant to paragraph 4(a) herein,
Employer agrees to pay Employee for the remaining term of this Agreement at an
annual rate equal to Employee's compensation as set forth in paragraph 4(a).
Amounts described above due Employee under this paragraph 7 shall be due and
payable for the duration of the remaining term in equal monthly installments. In
addition to the foregoing, Employer shall continue, for the duration of the
remaining term, to provide Employee with such additional fringe benefits to
which Employee was entitled as of the day immediately prior to the date of such
termination. Nothing in this paragraph 7 shall reduce or otherwise effect
Employee's right to the benefits set forth in paragraph 4(c), (d) and (e) herein
and Employee's severance payment set forth in paragraph 5 herein.
8. EXTENT OF SERVICES. Employee shall devote Employee's time, attention
and energy to the business of Employer, and shall not during the term
of this Agreement, or any extension hereof, without Employer's consent, be
engaged in any other business activity whether or not such business activity is
pursued for gain, profit or other pecuniary advantage; but nothing contained
herein shall be construed as preventing Employee from investing his assets in
such form or manner as will not require any service on the part of Employee in
the operation of the affairs of the corporations or other entities in which
Employee may invest his assets.
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9. COVENANTS OF EMPLOYEE.
(a) During the term of Employee's employment with Employer,
and for a period of one (1) year after the termination of such employment, for
whatever reason, except for the termination of Employee's employment under
circumstances which constitute a violation by Employer of the provisions of this
Agreement, Employee covenants and agrees that Employee will not (except as
required in Employee's duties to Employer), in any manner directly or
indirectly:
(i) Disclose or divulge to any person, entity, firm
or company whatsoever, or use for Employee's own benefit or the benefit of any
other person, entity, firm or company directly or indirectly, in competition
with the business of Employer, as the same may exist at the date of such
cessation, any proprietary business methods, customer lists, supplier lists,
business plans or other information or data of Employer, without regard to
whether all of the foregoing matters will otherwise be deemed confidential,
material or important, the parties hereto stipulating that as between them, the
same are important, material and confidential and greatly affect the effective
and successful conduct of the business and the goodwill of Employer, and that
any breach of the terms of this subparagraph (i) shall be a material breach of
this Agreement;
(ii) Solicit, divert, take away or interfere with any
of the customers, trade, business, patronage, employees or agents of Employer;
(iii) Engage, directly or indirectly, either
personally or as an employee, partner, associate, officer, manager, agent,
advisor, consultant or otherwise, or by means of any corporate or other entity
or device, in any business competitive with the business of Employer.
(b) For purposes hereof, a business will be deemed
competitive if (i) such business involves the manufacture and sale of steel, or
any other business which is competitive, during or as of the date of cessation
of Employee's employment, with any business then being conducted by Employer or
as to which Employer has at such time formulated definitive plans to enter; and
(ii) such business makes substantial sales of products competitive with those of
Employer in any of the States of Missouri, Illinois, Indiana, Iowa, Michigan,
Ohio and Pennsylvania.
(c) All of the covenants on behalf of Employee contained in
this paragraph 0 shall be construed as agreements independent of any other
provision of this Agreement, and the existence of any claim or cause of action
against Employer, whether predicated on this Agreement or otherwise, shall not
constitute a defense to the enforcement by Employer of these covenants.
(d) It is the intention of the parties to restrict the
activities of Employee under this paragraph 9 only to the extent necessary for
the protection of legitimate business interests of Employer, and the parties
specifically covenant and agree that should any of the clauses or provisions set
forth herein, under any set of circumstances not now foreseen by the parties, be
held by a court of competent jurisdiction to be illegal, invalid or
unenforceable under present or future laws effective during the term of this
Agreement, then and in that event, it is the intention of the parties hereto
that, in lieu of each such clause or provision of this paragraph
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9, there shall be substituted or added, and there is hereby substituted or
added, terms to such illegal, invalid or unenforceable clause or provision as
may be legal, valid and enforceable.
10. EXPENSES. In addition to compensation paid to Employee under
paragraph 4 hereof, during the period of Employee's employment, Employer
will pay directly or reimburse Employee for reasonable and necessary expenses
incurred by Employee in the interest of the business of Employer. All such
expenses paid by Employee will be reimbursed by Employer upon presentation by
Employee, from time to time, of an itemized account of such expenditures,
accompanied by appropriate receipts or other evidence of payment to the extent
necessary to permit the deductibility thereof for Federal income tax purposes.
11. DOCUMENTS. Employee agrees that all documents, instruments,
drawings, plans, contracts, proposals, records, notebooks, invoices, statements
and correspondence, including all copies thereof, relating to the business of
Employer, other than purely personal documents, shall be the property of
Employer; and upon the cessation of Employee's employment with Employer, for
whatever reason, all of the same then in Employee's possession, whether prepared
by Employee or others, will be left with or immediately delivered to Employer.
12. REMEDIES. It is agreed that any material breach or evasion of any
of the terms of this Agreement by Employee will result in immediate and
irreparable injury to Employer and will authorize recourse to injunction and/or
specific performance as well as to all other legal or equitable remedies to
which Employer may be entitled. No remedy conferred by any of the specific
provisions of this Agreement is intended to be exclusive of any other remedy,
and each and every remedy shall be cumulative and shall be in addition to every
other remedy whether given hereunder or not or whether hereafter existing at law
or in equity, by statute or otherwise. The election of any one or more remedies
by Employer or Employee shall not constitute a waiver of the right to pursue
other available remedies at any time or cumulatively from time-to-time.
13. SEVERABILITY. All agreements and covenants herein contained are
severable, and in the event any of them shall be held to be invalid or
unenforceable by any court of competent jurisdiction, this Agreement shall
continue in full force and effect and, subject to paragraph 9(d) hereof, shall
be interpreted as if such invalid agreement or covenant were not contained
herein.
14. WAIVER OR MODIFICATION. No amendment, waiver or modification of
this Agreement or of any covenant, condition or limitation herein contained
shall be valid unless in writing and duly executed by the party to be charged
therewith, and no evidence of any amendment, waiver or modification shall be
offered or received in evidence in any proceeding, arbitration or litigation
between the parties hereto arising out of or affecting this Agreement, or the
rights or obligations of the parties hereunder, unless such amendment, waiver or
modification is in writing, duly executed as aforesaid, and the parties further
agree that the provisions of this paragraph may not be waived or modified except
as herein set forth. Failure of Employee or Employer to exercise or otherwise
act with respect to any rights granted hereunder in the event of a breach of any
of the terms or conditions hereof by the other party, shall
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not be construed as a waiver of such breach, nor prevent Employee or Employer
from thereafter enforcing strict compliance with any and all of the terms and
conditions hereof.
15. FEES AND EXPENSES. If Employee is the prevailing party, Employer
shall pay all of Employee's reasonable legal fees and related expenses
(including the costs of experts, evidence and counsel) incurred by Employee as a
result of (i) Employee's termination of employment (including all such fees and
expenses, if any, incurred in contesting or disputing any such termination of
employment) or (ii) Employee's seeking to obtain or enforce any right or benefit
provided by this Agreement or by any other plan or arrangement maintained by
Employer under which Employee is or may be entitled to receive benefits.
16. NOTICES. All notices, requests, demands or other communications
hereunder ("Notice") shall be in writing and shall be given by registered or
certified mail, return receipt requested:
if to Employer to:
Laclede Steel Company Laclede Chain Manufacturing Co. Laclede Mid-America, Inc.
Attn: President. Attn: President Attn: President
President President President
000 Xxxxx Xxxxxx Xxxxxx 000 Xxxxx Xxxxxx Xxxxxx 440 North Fourth Street
3rd Floor 0xx Xxxxx 0xx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000 Xx. Xxxxx, Xxxxxxxx 00000 Xx. Xxxxx, Xxxxxxxx 00000
and, if to Employee, to:
Xxxxxxx X. Xxxx
0000 Xxxxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
or to such other addresses as to which the parties hereto give Notice in
accordance with this paragraph 16.
17. CONSTRUCTION. This Agreement shall be governed by and construed and
interpreted according to the laws of the State of Missouri, notwithstanding the
place of execution hereof, nor the performance of any acts in connection
herewith or hereunder in any other jurisdiction. For all purposes hereof,
reference to Employer shall include each and every subsidiary and affiliated
company of Employer.
18. ASSIGNABILITY. The services to be performed by Employee hereunder
are personal in nature and therefore Employee shall not assign his rights or
delegate his obligations under this Agreement, and any attempted or purported
assignment or delegation not herein permitted shall be null and void.
19. SUCCESSORS. Subject to the provisions of paragraph 9, this
Agreement shall be binding upon and shall inure to the benefit of Employer and
Employee and their respective heirs, executors, administrators, legal
representatives, successors and assigns.
20. PRIOR EMPLOYMENT AGREEMENTS. Any prior Employment Agreement between
Employer and Employee is hereby terminated by mutual agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
______________________________
XXXXXXX X. XXXX
"Employee"
LACLEDE STEEL COMPANY
By_______________________________________
Xxxxxx X. Xxxx, Xx, President
LACLEDE CHAIN MANUFACTURING CO.
By_______________________________________
Xxxxx X. Xxxxxxx, President
LACLEDE MID AMERICA, INC.
By_______________________________________
Xxxxx X. Xxxxxxx, President
"Employer"
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