EXHIBIT 10-CC
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
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THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT is dated and effective as of
the 1st day of February, 1998 ("Effective Date"), and is by and between National
Steel Corporation, a Delaware corporation (the "Company"), and Xxxxxx X. Xxxxxxx
("Executive"). In consideration of the mutual covenants contained herein, and
other good and valuable consideration (including the Termination Benefits and
the Special Termination Benefits) the receipt and adequacy of which the Company
and Executive each hereby acknowledge, the Company and Executive hereby agree as
follows:
1. Employment and Term
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Executive is or may be employed by the Company pursuant to one or more
contracts or letter agreements (the "Prior Agreement"). The Company hereby
agrees to employ Executive as a Vice President of the Company and Executive
hereby agrees to accept such employment and serve in such capacity on a full-
time basis during the Term and upon the terms and conditions set forth in this
Amended and Restated Employment Agreement (this "Agreement"). Executive shall
report to an officer of the Company designated by the Company's Chief Executive
Officer and Executive will have such responsibilities, duties and authorities as
are determined by the officer to whom Executive reports. The term of employment
of Executive under this Agreement shall be the period commencing on the
Effective Date and terminating on June 1, 1999, unless extended or unless sooner
terminated by the Company or Executive as hereinafter provided (the "Term"). On
June 1, 1999, the Term shall be automatically extended on a month to month basis
without further action by either party unless either party hereto notifies the
other party that such extension shall not occur. In the event either party
notifies the other party that such extension shall not occur, or continue to
occur, Executive's employment shall terminate automatically at the end of the
initial Term or any extended Term, as the case may be. "Term" shall mean the
initial term as well as any extension thereof. In the event the Company notifies
Executive that the initial Term, or any extended Term, shall not be further
extended, such notification shall be deemed to be a termination of Executive's
employment without Cause. The respective rights and obligations of the parties
hereunder shall survive any termination of employment to the extent necessary to
achieve the intended preservation of rights and obligations.
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2. Salary and Annual Incentive Compensation.
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Executive's annual base salary as in effect on the Effective Date shall be
the Executive's annual base salary hereunder as of the Effective Date, payable
in consecutive equal monthly installments. The term "base salary" as utilized in
this Agreement shall refer to the then current base salary as adjusted from time
to time. Executive shall also be eligible to receive annual incentive
compensation pursuant to the Company's Management Incentive Compensation Program
or any successor plan (the "MICP") during the Term and as determined in
accordance with the terms and conditions of the MICP. Executive's MICP target
annual incentive compensation for 1998 shall be 35% of base salary. The Company
will maintain in effect, for each year during the Term, the MICP or an
equivalent plan under which Executive will be eligible for an award not less
than the prior year opportunity level available to Executive. Any such annual
incentive compensation payable to Executive shall be paid in accordance with the
Company's usual practices with respect to payment of incentive compensation of
senior executives.
3. Benefit and Compensation Plans.
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(a) Executive shall be entitled during the Term to participate in all
executive compensation plans, and other employee and executive benefits,
practices, policies and programs of the Company, as presently in effect or as
they may be modified or added to by the Company from time to time ("Benefit
Plans"); and during the Term, the Company will pay the cost of financial and
tax planning services, up to a maximum amount in effect on the Effective Date of
this Agreement. Such services shall be furnished by a provider selected by
Executive.
(b) During the Term, the Company will provide Executive with coverage by
long-term disability insurance and benefits; and group or individual life
insurance or a combination thereof, all in accordance with the plans, policies,
programs and arrangements as presently in effect or as they may be modified or
added to by the Company from time to time.
(c) During the Term, Executive will participate in the Company's Executive
Deferred Compensation Plan, ERISA Parity Plan, and any other supplemental
retirement plans, benefits, practices, programs, or policies of the Company, as
in effect on the Effective Date or as they may be modified or added to by the
Company from time to time ("Compensation Plans").
4. Non-Compete Agreement.
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Executive hereby agrees that if Executive voluntarily terminates his
employment with the Company, then for a period of one (1) year after the Date of
Termination, but in any event only as long as the Company satisfies its
obligations
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under this Agreement, (the "Restricted Period"), Executive will not
engage (either as owner, investor, partner, stockholder, employer, employee or
director) in any "Competitive Business" in the continental United States (the
"Territory"). The term "Competitive Business" means the making, producing,
manufacturing or coating of steel products which products are in direct
competition with steel products that are made, produced, manufactured or coated
by the Company on the Date of Termination. It is agreed that the ownership of
not more than one percent of the equity securities of any company having
securities listed on an exchange or regularly traded in the over-the-counter
market shall not be deemed inconsistent with this Section 4. If any court of
competent jurisdiction shall deem any obligation of this Section 4 too lengthy
or the Territory too extensive, the other provisions of this Section shall
nevertheless stand, the Restricted Period shall be deemed to be the longest
period such court deems not to be too lengthy and the Territory shall be deemed
to comprise the portion of the United States east of the Mississippi River (or
such other portion of the United States that such court deems not to be too
extensive).
5. Non-Inducement
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Executive hereby agrees that for a period commencing with the Date of
Termination and ending on the second anniversary of the Date of Termination,
Executive shall not induce, or attempt to influence, any employee of the Company
who reports either directly to the Company's Chief Executive Officer or to
another employee who reports directly to the Company's Chief Executive Officer,
to terminate his employment with the Company.
6. Non-Disclosure
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For a period commencing on the Date of Termination and ending on the fifth
anniversary of the Date of Termination, Executive shall keep secret and retain
in strictest confidence, and shall not furnish, make available or disclose to
any third party or use for the benefit of himself or any third party, any
Confidential Information. As used in this Section, "Confidential Information"
shall mean any information relating to the business or affairs of the Company,
including but not limited to information relating to financial statements,
customer identities, customer needs, potential customers, employees, suppliers,
servicing methods, equipment, programs, strategies and information, analyses,
profit margins or other proprietary information used by the Company in
connection with its business; provided, however, that Confidential Information
shall not include any information which is in the public domain or becomes known
in the industry through no wrongful act on the part of Executive. Executive
acknowledges that the Confidential Information is vital, sensitive, confidential
and proprietary to the Company.
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7. No Unfavorable Publicity
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Subsequent to Executive's Date of Termination, Executive agrees not to make
statements or communications and not to issue any written communications or
release any other written materials which would likely be materially damaging to
the Company's reputation or standing, whether in the investor or financial
community, the steel industry or otherwise.
8. Cooperation With the Company
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Executive agrees to cooperate with the Company for a reasonable period of time
after the Term of this Agreement by making himself available to testify on
behalf of the Company, in any action, suit, or proceeding. In addition, for a
reasonable period of time, Executive agrees to be available at reasonable times
to meet and consult with the Company on matters reasonably within the scope of
his prior duties with the Company so as to facilitate a transition to his
successor. The Company agrees to reimburse Executive, on an after-tax basis,
for all expenses actually incurred in connection with his provision of testimony
or consulting assistance.
9. Release of Employment Claims
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Executive and the Company agree that in the event Executive receives Special
Termination Benefits (as defined in Section 11(d)), he and the Company will
execute a mutual release agreement releasing any and all claims which either of
them have or may have against the other arising out of Executive's employment
(other than enforcement of this Agreement). Executive agrees that in the event
his employment with the Company terminates or is terminated, the Executive's
sole and exclusive remedy shall be, and the Company's liability shall be limited
to, damages equal to the payments and benefits to be provided by the Company
hereunder and to payment or reimbursement of Executive's costs and expenses in
accordance with Section 13(b).
10. Remedies
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Executive acknowledges and agrees that the covenants set forth in Sections 4
through 8 are reasonable and necessary for the protection of the Company's
business interests, that irreparable injury will result to the Company if
Executive breaches any of the terms of such covenants, and that in the event of
Executive's actual or threatened breach of any such covenants, the Company will
have no adequate remedy at law. Executive accordingly agrees that in the event
of any actual or threatened breach by him of any of such covenants, the Company
shall be entitled to immediate temporary injunctive and other equitable relief,
without the necessity of showing actual monetary damages, subject to hearing as
soon thereafter as possible. Nothing contained herein shall be construed as
prohibiting the Company from pursuing any other remedies available to it for
such breach or threatened breach,
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including the recovery of any damages which it is able to prove.
11. Termination of Employment.
(a) Termination Due to Death or Disability. Upon an Executive's Date of
Termination during the Term due to death or Disability, the Company will pay
Executive (or his beneficiaries, dependents or estate), and Executive (or his
beneficiaries, dependents or estate) will be entitled to receive, the
Termination Benefits (as defined in Section 11(c)).
(b) Other Termination. Upon Executive's Date of Termination, either by the
Company without Cause, or by Executive for any reason other than death or
Disability, the Company shall pay Executive (or his beneficiaries, dependents or
estate), and Executive (or his beneficiaries, dependents or estate) shall be
entitled to receive, the Termination Benefits (as defined in Section 11(c)) and
the Special Termination Benefits (as defined in Section 11(d)).
(c) "Termination Benefits". "Termination Benefits" means the aggregate of
all of the following:
(i) A single sum cash payment by the Company to Executive within thirty
(30) days after the Date of Termination of
(A) Executive's then current annual base salary pro rata through the Date
of Termination to the extent not theretofore paid; (B) the product of (y) the
greater of (aa) the average annual incentive compensation paid to Executive in
the three fiscal years immediately preceding the fiscal year of the Date of
Termination (or all fiscal years Executive was employed if less than three, and
annualized in the event Executive was not employed by the Company for the whole
of any such fiscal year), and (bb) Executive's target incentive compensation
percentage payable under the MICP multiplied by Executive's then current base
salary and (z) a fraction, the numerator of which is the number of days in the
current fiscal year through the Date of Termination, and the denominator of
which is 365; (C) any accrued vacation pay to the extent not theretofore paid;
and (D) Reimbursement of reasonable business expenses and disbursements incurred
by Executive prior to such Date of Termination.
(ii) All vested amounts owing or accrued at the Date of Termination under
any compensation and benefit plans, programs, and arrangements set forth or
referred to in this Agreement, including, but not limited to, Sections 2 and 3
hereof; and if the Date of Termination is due to Disability or death, Executive
or his estate or other beneficiaries shall receive the Disability or death
benefits described in Section 3(b).
(iii) Executive shall be eligible to receive incentive compensation based
on
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the Company's performance for the preceding year (to the extent not previously
paid), if and when any such incentive compensation for such year is paid to
eligible employees generally pursuant to the Company's MICP.
(d) "Special Termination Benefits". "Special Termination Benefits" means
the aggregate of all of the following:
(i) The Company shall pay to Executive, in a single sum in cash within
thirty (30) days after the Date of Termination, an amount equal to (y) one times
the Executive's annual base salary (immediately preceding the Date of
Termination), plus (z) in the event a Change of Control has previously occurred,
an additional amount equal to one times the greater of (aa) the average annual
incentive compensation paid to Executive in the three fiscal years immediately
preceding the fiscal year of the Date of Termination (or all fiscal years
Executive was employed if less than three, and annualized in the event Executive
was not employed by the Company for the whole of any such fiscal year), or (bb)
Executive's most recent target incentive compensation percentage payable under
the MICP multiplied by his then current base salary; provided, however, that
notwithstanding the foregoing, in the event a Change of Control has previously
occurred, the maximum aggregate amount payable under this Section 11(d)(i) shall
not exceed three times the Executive's annual base salary (immediately preceding
the Date of Termination).
(ii) For two years after Executive's Date of Termination, the Company
shall continue life insurance benefits and financial and tax planning benefits
to Executive equal to the life insurance benefits and financial and tax planning
benefits that would have been provided to him if Executive's employment had not
been terminated.
(iii) Stock options and stock appreciation rights held by Executive on his
Date of Termination will immediately become fully vested and exercisable and
shall remain fully exercisable for a period of two years following his Date of
Termination; such stock options and stock appreciation rights shall otherwise be
governed by the plans and programs (and the agreements and other documents
thereunder) pursuant to which such stock options and stock appreciation rights
were granted; provided, however, that notwithstanding the foregoing, no stock
options or stock appreciation rights may be exercised until at least six months
after the date of grant.
(iv) In the event Executive terminates his employment after September 30,
1998, upon at least 30 days' notice, or if his employment is terminated by the
Company at any time without Cause, in each case prior to his having at least
five years of service for vesting purposes under the National Steel Corporation
Retirement Program (including any successor thereto), the Company shall provide
Executive the retirement benefits which he would have been entitled to receive
pursuant to the Retirement Plan and the Company's ERISA Parity Plan had his
employment continued, at the rate of compensation in effect immediately prior to
the termination
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of his employment, until he had five years of service for vesting purposes under
the Retirement Plan. Executive's retirement benefit shall be calculated (i)
without regard to the limitations on earnings taken into account for purposes of
calculation of accrued benefits under section 401(a)(17) of the Internal Revenue
Code of 1986, as amended (the "Code") and (ii) without regard to any applicable
limitations on maximum benefits under section 415 of the Code. The retirement
benefit or its actuarially equivalent value shall be payable beginning as of the
first day of the month following the month in which occurs the later of
Executive's 65th birthday or termination of employment, in the form of the
normal form of benefit under the Retirement Plan or such optional form of
benefit as Executive elects from among the forms of payment then available under
the Retirement Plan.
12. Special Provisions on Change of Control.
In the event of a Change of Control, the provisions of this Section shall
apply, and the Agreement shall be interpreted and applied consistently with the
provisions of this Section.
(a) Benefit and Compensation Plans. In no event shall Benefit Plans or
Compensation Plans provide Executive with benefits or compensation, in each
case, less favorable, in the aggregate, than the most favorable of those
provided by the Company for Executive under Benefit Plans or Compensation Plans
as in effect at any time during the 120-day period immediately preceding the
Change of Control or if more favorable to Executive, those provided generally at
any time after the Change of Control to other peer executives of the Company. If
after a Change of Control (i) Executive terminates his employment with the
Company for any reason, or (ii) Executive's employment with the Company is
terminated without Cause, the actuarially equivalent value of nonqualified
unfunded retirement benefits under any plan, program or arrangement of the
Company shall be paid to Executive in a single sum within thirty (30) days after
Executive is no longer employed by the Company.
(b) Tax Matters. If Executive becomes entitled to one or more payments
(with a "payment" including, without limitation, any Termination Benefits,
Special Termination Benefits, the vesting of any stock option or stock
appreciation right or other cash or non-cash benefit or property), whether
pursuant to the terms of this Agreement or any other plan, program, policy,
practice, arrangement, or agreement with the Company (the "Benefit Payments"),
which are or may become subject to the tax imposed by Section 4999 of the
Internal Revenue Code of 1986, as amended (the "Code") (or any similar tax that
may hereafter be imposed) (the "Excise Tax"), the Company shall indemnify and
hold the Executive harmless on an after-tax basis from the Excise Tax and any
additional federal, state, and local income tax, employment tax and penalties
and interest thereon, and the Company shall pay to Executive at the time of the
Benefit Payments (or at the time the Excise Tax is imposed, if earlier) an
additional amount which shall equal and include the Excise Tax,
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reimbursement for any penalties and interest that may accrue in respect of any
Excise Tax (including any penalties or interest thereon) and any federal, state
and local income or employment tax and Excise Tax on such additional amount,
including any penalties or interest thereon (collectively, the "Additional
Amounts"), but before reduction for any federal, state, or local income or
employment tax on the Benefit Payments, so that after payment of the previously
mentioned taxes (including penalties and interest thereon) Executive retains an
amount equal to the sum of (a) the Benefit Payments, and (b) an amount equal to
the product of any deductions disallowed for federal, state, or local income tax
purposes because of the inclusion of the Additional Amounts in Executive's
adjusted gross income multiplied by the highest applicable marginal rate of
federal, state, or local income taxation, respectively, for the calendar year in
which payment of the Additional Amounts is to be made.
The Benefit Payments shall be treated as "parachute payments" within the
meaning of Section 280G(b)(2) of the Code, and all "excess parachute payments"
within the meaning of Section 280G(b)(1) of the Code shall be treated as subject
to the Excise Tax, unless, and except to the extent independent legal counsel or
independent compensation consultants or independent certified public accountants
of nationally recognized standing mutually selected by the Company and Executive
("Independent Advisors") provide a written opinion acceptable to Executive that
the Benefit Payments (in whole or in part) are not subject to Excise Tax because
they do not constitute parachute payments, or such excess parachute payments (in
whole or in part) represent reasonable compensation for services actually
rendered within the meaning of Section 280G(b)(4) of the Code in excess of the
base amount within the meaning of Section 280G(b)(3) of the Code or are
otherwise not subject to the Excise Tax.
For purposes of determining the amount of the Additional Amounts, Executive
shall be deemed (A) to pay federal income taxes at the highest marginal rate of
federal income taxation for the calendar year in which the payment of the
Additional Amounts is to be made; (B) to pay any applicable state and local
income taxes at the highest marginal rate of taxation for the calendar year in
which the payment of the Additional Amounts is to be made, net of the maximum
reduction in federal income taxes which could be obtained from deduction of such
state and local taxes if paid in such year (determined without regard to
limitations on deductions based upon the amount of Executive's adjusted gross
income); and (C) to have otherwise allowable deductions for federal, state, and
local income tax purposes at least equal to those disallowed because of the
inclusion of the Additional Amounts in Executive's adjusted gross income.
The Company shall have the right to contest any claim by the Internal
Revenue Service relating to the Excise Tax; provided, however, that the Company
shall bear and pay directly all costs and expenses (including additional
interest and penalties)
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incurred in connection with such contest and shall indemnify and hold Executive
harmless, on an after-tax basis, for any Excise Tax, federal, state and local
income or employment tax (including interest and penalties with respect thereto)
imposed and payment of costs and expenses.
The Company shall bear all of its own expenses and the expense of the
Independent Advisors, and the legal, consulting and accounting expenses of
Executive incurred by Executive for any reason under or with respect to this
Section.
13. Governing Law; Disputes; Arbitration.
(a) Governing Law. This Agreement is governed by and is to be construed,
administered, and enforced in accordance with the laws of the State of Indiana,
without regard to Indiana conflicts of law principles, except insofar as the
Delaware General Corporation Law and federal laws and regulations may be
applicable. If under the governing law, any portion of this Agreement is at any
time deemed to be in conflict with any applicable statute, rule, regulation,
ordinance, or other principle of law, such portion shall be deemed to be
modified or altered to the extent necessary to conform thereto or, if that is
not possible, to be omitted from this Agreement. The invalidity of any such
portion shall not affect the force, effect, and validity of the remaining
portion hereof.
(b) Reimbursement of Expenses in Enforcing Rights. All costs and expenses
(including, without limitation, fees and disbursements of actuaries, accountants
and counsel) incurred by Executive in seeking in good faith to enforce rights
pursuant to this Agreement shall be paid on behalf of or reimbursed to Executive
promptly by the Company, whether or not Executive is successful in asserting
such rights. If there shall be any dispute between the Company and Executive,
the Company shall pay or provide, as applicable, all undisputed amounts or
benefits as are then payable to Executive or Executive's beneficiaries or
dependents pursuant to this Agreement. Any amounts that have become payable
pursuant to the terms of this Agreement or any decision by arbitrators or
judgment by a court of law, but which are not timely paid shall bear interest,
payable by the Company, at the lower of (A) the highest lawful rate or (B) the
prime rate in effect at the time such payment first becomes payable, as quoted
by The Wall Street Journal.
(c) Arbitration. Any dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration in
Chicago, Illinois, in accordance with the rules of the American Arbitration
Association in effect at the time of submission to arbitration, by three (3)
arbitrators, one of which shall be chosen by the Company, one of which shall be
chosen by Executive, and one of which shall be chosen by the arbitrators chosen
by Company and Executive. Judgment may be entered on the arbitrators' award in
any court having jurisdiction. For purposes of entering any judgment upon an
award rendered by the arbitrators,
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the Company and Executive hereby consent to the jurisdiction of any or all of
the following courts: (i) the United States District Court for the Northern
District of Indiana; (ii) any of the courts of the State of Indiana, or (iii)
any other court having jurisdiction. The Company and Executive further agree
that any service of process or notice requirements in any such proceeding shall
be satisfied if the rules of such court relating thereto have been substantially
satisfied. The Company and Executive hereby waive, to the fullest extent
permitted by applicable law, any objection which it may now or hereafter have
to such jurisdiction and any defense of inconvenient forum. The Company and
Executive hereby agree that a judgment upon an award rendered by the arbitrators
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. The Company shall bear all costs and expenses arising in
connection with any arbitration proceeding. Notwithstanding any provision in
this Section 13(c), Executive shall be entitled to seek specific performance of
Executive's right to be paid during the pendency of any dispute or controversy
arising under or in connection with this Agreement.
14. Definitions
Certain terms in this Agreement are defined the first time they appear;
other terms which are capitalized are not defined the first time they appear,
but unless the context indicates otherwise, have the meanings set forth below:
(a) "Cause". For purposes of this Agreement, "Cause" shall mean
Executive's gross misconduct (as defined herein) or willful and material breach
of this Agreement. For purposes of this definition, "gross misconduct" shall
mean (A) a felony conviction or a plea of nolo contendere to a felony charge in
a court of law under applicable federal or state laws which results in material
damage to the Company, or (B) willfully engaging in one or more acts which is
demonstrably and materially damaging to the Company. Notwithstanding the
foregoing, Executive may not be terminated for Cause unless and until there
shall have been delivered to him, within six months after the Board (A) had
knowledge of conduct or an event allegedly constituting Cause and (B) had reason
to believe that such conduct or event could be grounds for Cause, a copy of a
resolution duly adopted by a majority affirmative vote of the entire membership
of the Company's Board of Directors (excluding Executive if a member of
Company's Board of Directors), at a meeting of the Board called and held for
such purpose (after giving Executive reasonable notice specifying the nature of
the grounds for such termination and not less than 30 days to correct the acts
or omissions complained of, if correctable, and affording Executive the
opportunity, together with his counsel, to be heard before the Board) finding
that, in the good faith opinion of the Board, Executive was guilty of conduct
set forth above in this Section 14(a).
(b) "Change of Control". For the purpose of this Agreement, a "Change of
Control" shall mean:
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(i) (A) If any individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) (a "Person") acquires (by purchase, tender offer or otherwise)
or becomes the "beneficial owner" (as defined in rule 13d-3 under the Exchange
Act) of thirty percent (30%) or more of the combined voting power of the then-
outstanding voting securities of the Company entitled to vote generally in the
election of directors (the "Outstanding Company Voting Securities") and (B) NKK
Corporation ceases to be the beneficial owner, directly or indirectly, of more
than fifty percent (50%) of the total voting power of all the then Outstanding
Company Voting Securities; provided, however, that for purposes of this
subsection (i), the following acquisitions shall not constitute a Change of
Control: (1) any acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company, or (2) any acquisition by any entity
pursuant to a transaction which complies with each of clauses (A), (B) and (C)
of subsection (iii) of this paragraph (b);
(ii) Individuals who, as of the date hereof, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority of the
Board; provided, however, that any individual becoming a director subsequent to
the date hereof whose election, or nomination for election by the Company's
shareholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board;
(iii) Consummation of a reorganization, recapitalization, merger,
acquisition of securities or assets by the Company or consolidation or sale or
other disposition of all or substantially all of the assets of the Company (a
"Business Combination"), in each case, unless, following such Business
Combination, (A) the individuals and entities who were the beneficial owners,
respectively, of the then outstanding shares of common stock of the Company (the
"Outstanding Company Common Stock") and Outstanding Company Voting Securities
immediately prior to such Business Combination beneficially own, directly or
indirectly, more than fifty percent (50%) of, respectively, the then-outstanding
shares of common stock and the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of directors, as
the case may be, of the corporation resulting from such Business Combination
(including, without limitation, the Company or a corporation which as a result
of such transaction owns the Company or all or substantially all of the
Company's assets either directly or through one or more subsidiaries) in
substantially the same proportions as their ownership, immediately prior to such
Business Combination of the Outstanding Company Common Stock and Outstanding
Company
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Voting Securities, as the case may be and (B) no Person (excluding any
corporation resulting from such Business Combination or any employee benefit
plan (or related trust) of the Company or such corporation resulting from such
Business Combination) beneficially owns, directly or indirectly, thirty percent
(30%) or more of, respectively, the then outstanding shares of common stock of
the corporation resulting from such Business Combination, or the combined voting
power of the then outstanding voting securities of such corporation except to
the extent that such ownership existed prior to the Business Combination and (C)
at least two-thirds of the members of the board of directors of the corporation
resulting from such Business Combination were members of the Incumbent Board at
the time of the execution of the initial agreement, or of the action of the
Board, providing for such Business Combination; or
(iv) Approval by the shareholders of the Company of a complete liquidation
or dissolution of the Company.
(c) "Date of Termination". "Date of Termination" means (i) if Executive's
employment is terminated by the Company for any reason other than death or
Disability, or by Executive for any reason other than death or Disability, the
date of receipt of the notice of termination or any later date specified
therein, as the case may be; and (ii) if Executive's employment is terminated by
reason of death or Disability, the Date of Termination shall be the date of
death of Executive or the Disability Effective Date, as the case may be. If the
Company determines in good faith that the Disability of Executive has occurred
pursuant to the definition of Disability set forth in Section 14(d), it may give
to Executive written notice of its intention to terminate Executive's
employment. In such event, Executive's Date of Termination is effective on the
date that is six months after receipt of such notice by Executive (the
"Disability Effective Date"), provided that, within such six month period,
Executive shall not have returned to full- time performance of Executive's
duties.
(d) "Disability". "Disability" means the failure of Executive to render
and perform the services required of him under this Agreement, for a total of
180 days or more during any consecutive 12 month period, because of any physical
or mental incapacity or disability as determined by a physician or physicians
selected by the Company and reasonably acceptable to Executive, unless, within
six (6) months after Executive has received written notice from the Company of a
proposed Date of Termination due to such absence, Executive shall have returned
to the full performance of his duties hereunder and shall have presented to the
Company a written certificate of Executive's good health prepared by a physician
selected by Executive and reasonably acceptable to the Company.
15. Miscellaneous.
(a) Integration. This Agreement modifies and supersedes any and all prior
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employment agreements (including but not limited to the Prior Agreement, if
any). This Agreement constitutes the entire agreement among the parties with
respect to the matters herein provided, and no modification or waiver of any
provision hereof shall be effective unless in writing and signed by the parties
hereto. Notwithstanding the foregoing, all stock options and stock appreciation
rights granted to Executive pursuant to such Prior Agreement shall remain
outstanding, and to the extent applicable, Section 11(d)(iii) shall apply to
such stock options and stock appreciation rights and shall also apply to such
other stock options and stock appreciation rights now or hereafter granted to
Executive.
(b) Nonexclusivity of Rights. Nothing in this Agreement shall prevent or
limit Executive's continuing or future participation in any plan, program,
policy or practice provided by the Company or any of its affiliated companies
and for which Executive may qualify, nor shall anything herein limit or
otherwise affect such rights as Executive may have under any contract or
agreement with the Company or any of its affiliated companies. Amounts which are
vested benefits or which Executive is otherwise entitled to receive under any
plan, policy, practice or program of or any contract or agreement with the
Company or any of its affiliated companies at or subsequent to the Date of
Termination shall be payable in accordance with such plan, policy, practice or
program or contract or agreement except as explicitly modified by this
Agreement. In the event of any conflict between the terms and provisions of this
Agreement and any of the Company's plans, policies, practices, programs,
contracts or agreements, the terms and provisions of whichever is more favorable
to the Executive shall prevail.
(c) Non-Transferability. Neither this Agreement nor the rights or
obligations hereunder of the parties hereto shall be transferable or assignable
by Executive, except in accordance with the laws of descent and distribution or
as specified in Section 15(d). The Company may, but only with the consent of
Executive, assign this Agreement and the Company's rights and obligations
hereunder, and the Company shall, as a condition of the succession, require such
Successor to assume (jointly and severally with the Company) the Company's
obligations and be bound by this Agreement. Any such assignment shall not
release the Company of any of its obligations under this Agreement. For purposes
of this Agreement, "Successor" shall mean any person that succeeds to, or has
the practical ability to control (either immediately or with the passage of
time), the Company's business directly, by merger or consolidation, or
indirectly, by purchase of the Company's voting securities or all or
substantially all of its assets, or otherwise.
(d) Beneficiaries. Executive shall be entitled to designate (and change,
to the extent permitted under applicable law) a beneficiary or beneficiaries to
receive any compensation or benefits payable hereunder following Executive's
death. If Executive should die while any amount would still be payable to him
hereunder had Executive continued to live, all such amounts, unless otherwise
provided herein, shall
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be paid in accordance with the terms of this Agreement to his devisee, legatee
or other designee or, if there is no such designee, to his estate.
(e) Notices. Whenever under this Agreement it becomes necessary to give
notice, such notice shall be in writing, signed by the party or parties giving
or making the same, and shall be served on the person or persons for whom it is
intended or who should be advised or notified, by overnight courier service or
by certified or registered mail, return receipt requested, postage prepaid and
addressed to such party at the address set forth below or at such other address
as may be designated by such party by like notice:
If to the Company: With copies to:
Senior Vice President - Administration Senior Vice President &
National Steel Corporation General Counsel
0000 Xxxxxx Xxxxx Xxxxxxx National Steel Corporation
Xxxxxxxxx, Xxxxxxx 00000-0000 0000 Xxxxxx Xxxxx Xxxxxxx
Xxxxxxxxx, Xxxxxxx 00000-0000
If to Executive at his then current address reflected in the Company's
records.
If the parties by mutual agreement supply each other with telecopier
numbers for the purposes of providing notice by facsimile, such notice shall
also be proper notice under this Agreement when sent. In the case of overnight
courier service, such notice or advice shall be effective when sent, and, in the
cases of certified or registered mail, shall be effective 2 days after deposit
into the mails by delivery to the U.S. Post Office. If the person to receive the
notice (or a copy thereof) for the Company is Executive, then notice to the
Company shall be sent to the Chief Executive Officer of the Company at the above
address rather than to the officer previously named.
(f) Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
(g) No General Waivers. The failure of any party at any time to require
performance by any other party of any provision hereof or to resort to any
remedy provided herein or at law or in equity shall in no way affect the right
of such party to require such performance or to resort to such remedy at any
time thereafter, nor shall the waiver by any party of a breach of any of the
provisions hereof be deemed to be a waiver of any subsequent breach of such
provisions. No such waiver shall be effective unless in writing and signed by
the party against whom such waiver is sought to be enforced.
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(h) No Obligation To Mitigate. Executive shall not be required to seek
other employment or otherwise to mitigate Executive's damages on or after
Executive's Date of Termination, and the amount of any payment or benefit
provided for in this Agreement shall not be reduced by any compensation or
benefits earned by Executive as the result of employment by another employer or
by retirement benefits.
(i) Offsets; Withholding. The amounts required to be paid by the Company
to Executive pursuant to this Agreement shall not be subject to offset. The
foregoing and other provisions of this Agreement notwithstanding, all payments
to be made to Executive under this Agreement, including under Sections 11 and
12, or otherwise by the Company, will be subject to required withholding taxes
and other required deductions.
(j) Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of Executive, his heirs, executors, administrators
and beneficiaries, and shall be binding upon and inure to the benefit of the
Company and its permitted successors and assigns as provided in Section 15(c).
This Agreement is a personal contract and the rights and interests of Executive
hereunder may not be sold, transferred, assigned, pledged, encumbered, or
hypothecated by him, except as otherwise expressly permitted by the provisions
of this Agreement. This Agreement shall inure to the benefit of and be
enforceable by Executive and his personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.
(k) Actuarially Equivalent Value Calculation. For the purpose of
determining an actuarially equivalent value under the terms of this Agreement,
the interest rate specified in Section 417(e)(3) of the Internal Revenue Code of
1986, or any successor section thereto, as of the date of such determination,
and the 1994 Group Annuitants Mortality Table, shall be used and for purposes of
determining present value under the terms of this Agreement, the interest rate
specified immediately above shall be used. All calculations shall be made at the
expense of the Company, by the independent auditors of the Company. As soon as
practicable after the need for such calculation arises, the Company shall
provide to its auditors all information needed to perform such calculations.
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IN WITNESS WHEREOF, Executive has hereunto set his hand and the Company has
caused this instrument to be duly executed as of the day and year first above
written.
NATIONAL STEEL CORPORATION
By: /s/ Osamu Sawaragi
-------------------------------
Name: Osamu Sawaragi
Title: Chairman of the Board and
Chief Executive Officer
/s/ Xxxxxx X. Xxxxxxx
------------------------------------
Xxxxxx X. Xxxxxxx
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