Exhibit 10.3
EXECUTION COPY
AMENDED AND RESTATED EMPLOYMENT
AGREEMENT
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT (the “Agreement”) dated
as of March 19, 2008 by and between Superior Essex Inc. (the
“Company”) and Barbara L. Blackford
(“Executive”).
The
Company and Executive entered into that certain Letter Agreement
dated as of February 26, 2004 (the “Original
Agreement”), as amended and restated on March 10, 2006
(the “Original Agreement”). The Company and
Executive desire to amend and restate the Original Agreement as set
forth herein.
THEREFORE , in consideration of
the premises and mutual covenants herein and for other good and
valuable consideration, the Company and Executive amend and restate
the Original Agreement as follows:
1.
Term of Employment . Subject to the provisions of
Section 8 of this Agreement, Executive shall continue to be
employed by the Company for a period commencing on April 12,
2004 and ending on December 31, 2006 (the “Employment
Term”) on the terms and subject to the conditions set forth
in this Agreement; provided , however , that
commencing with December 31, 2006 and on each anniversary
thereof (each an “Extension Date”), the Employment Term
shall be automatically extended for an additional one-year period,
unless the Company or Executive provides the other party hereto 90
days prior written notice before the next Extension Date that the
Employment Term shall not be so extended. The occurrence of a
Change in Control (as defined in the Superior Essex Inc. Amended
and Restated 2005 Incentive Plan) shall not affect the term of this
Agreement.
2.
Position .
a.
During the Employment Term, Executive shall serve as Executive Vice
President, General Counsel and Corporate Secretary of the
Company. In such position, Executive shall have such duties
and authority, consistent with such position with the Company, as
shall be determined from time to time by the Board of Directors of
the Company (the “Board”) or the Chief Executive of the
Company. Executive shall report directly to the Chief
Executive Officer of the Company.
b.
During the Employment Term, Executive will devote Executive’s
full business time and best efforts to the performance of
Executive’s duties hereunder and will not engage in any other
business, profession or occupation for compensation or otherwise
which would conflict or interfere, in any significant respect, with
the rendition of such services either directly or indirectly,
without the prior written consent of the Board.
Notwithstanding the foregoing, Executive may, without the prior
approval of the Board, (i) make and manage personal business
investments of Executive’s choice, subject to the prior
written consent of the Board if any such investment is beyond
merely buying and selling in the ordinary course (and, in so doing,
may serve as an officer, director, agent or employee of entities
and business enterprises that are related to such personal
investments) and (ii) serve in any capacity with any civic,
educational or charitable organization or any governmental entity
or trade association; provided that in each case, and in the
aggregate, such activities do not conflict or interfere, in
any
significant respect, with the performance of
Executive’s duties hereunder or conflict with
Section 9.
c.
Notwithstanding anything to the contrary in this Section 2,
Executive agrees to serve without additional compensation, if
elected or appointed thereto, as a director of the Company and any
of its subsidiaries and in one or more executive offices of any of
the Company’s subsidiaries, provided that Executive is
indemnified for serving in any and all such capacities.
3.
Base Salary . During the Employment Term, the Company
shall pay Executive a base salary at the annual rate of $344,000
(effective as of April 1, 2008), payable in regular
installments in accordance with the Company’s usual payment
practices (but not less often than monthly).
Executive’s base salary shall be reviewed annually by the
Board, and Executive shall be entitled to such increases in the
base salary, if any, as may be determined from time to time in the
sole discretion of the Board. Once increased, such base
salary shall not be decreased and no increase shall serve to limit
or reduce any other obligation to Executive under this
Agreement. Executive’s annual base salary, as in effect
from time to time, is hereinafter referred to as the “Base
Salary”.
4.
Annual Bonus . With respect to each fiscal year ending
during the Employment Term, Executive shall be eligible to earn an
annual bonus award (an “Annual Bonus”) based upon the
achievement of certain performance targets, as reasonably
established by the Board in good faith, after consultation with
Executive; provided , however , that Executive shall
have a target Annual Bonus of 60% of the Base Salary, subject to
Executive’s achievement of such performance targets.
5.
Equity Arrangements . [Intentionally Omitted]
6.
Employee Benefits . During the Employment Term,
Executive shall be entitled to participate in the Company’s
(or its affiliates’) employee benefit plans, programs and
arrangements as in effect from time to time (collectively, the
“Employee Benefits”), on the same basis as those
benefits generally are made available to other senior executives of
the Company, commensurate with Executive’s position with the
Company. Such benefits shall include, but not be limited to,
the Superior Essex Inc. Amended and Restated Senior Executive
Retirement Plan (the “SERP”) effective April 1,
2008, or another plan providing materially the same benefits as the
SERP. The accrual rate applicable to Executive shall be
reduced to 1.5% effective January 1, 2009. In
consideration of such reduction and other changes reflected in the
SERP, Executive shall be entitled to receive shares of restricted
stock described in Exhibit A on April 1, 2008.
7.
Business Expenses and Perquisites .
a.
Business and Other Expenses . During the Employment
Term, reasonable business expenses incurred by Executive in the
performance of Executive’s duties hereunder shall be
reimbursed by the Company in accordance with Company policies.
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b.
Perquisites . While employed hereunder, Executive
shall be entitled to (i) any perquisites that generally are
made available to other senior executives of the Company and
(ii) those perquisites set forth on Exhibit B attached
hereto.
8.
Termination . The Employment Term and
Executive’s employment hereunder may be terminated by either
party at any time and for any reason in the manner provided
herein. Notwithstanding any other provision of this
Agreement, the provisions of this Section 8 shall exclusively
govern Executive’s rights upon termination of employment with
the Company and its affiliates. Subject to
Section 12(h) hereof, whenever this Agreement provides
for the payment of a lump sum benefit following termination of
employment, such payment shall be made within 30 days after the
employment termination date, subject to the execution and
non-revocation of the release referred to in
Section 8(h).
a.
By the Company for Cause or Resignation by Executive without
Good Reason .
(i)
The Employment Term and Executive’s employment hereunder may
be terminated by the Company for Cause and shall terminate
automatically upon Executive’s resignation without Good
Reason; provided , however , that Executive will be
required to give the Company at least 30 days advance written
notice of a resignation without Good Reason.
(ii)
For purposes of this Agreement, “Cause” shall mean
(A) Executive’s continued willful failure to perform
substantially Executive’s duties hereunder (other than as a
result of total or partial incapacity due to physical or mental
illness) following written notice by the Company to Executive of
such failure, (B) dishonesty in the performance of
Executive’s duties hereunder which is injurious (other than
in some immaterial or de minimis respect) to the financial
condition or business reputation of the Company or any of its
affiliates, (C) Executive’s conviction of, or plea of
guilty or nolo contendere to, a crime constituting
(y) a felony under the laws of the United States or any state
thereof or (z) a misdemeanor involving misconduct by Executive
in her personal or professional conduct punishable by imprisonment
of more than three days or a fine in excess of $5,000 (other than a
traffic violation), which is reasonably likely to damage the
business, prospects or reputation of the Company or any of its
affiliates in any respect, (D) Executive’s willful
malfeasance or willful misconduct in connection with
Executive’s duties hereunder or any act or omission which is
injurious (other than in some immaterial or de minimis respect) to
the financial condition or business reputation of the Company or
any of its affiliates or (E) Executive’s breach of the
provisions of Section 9 or 10 of this Agreement (other than a
breach which is insubstantial and insignificant, taking into
account all of the circumstances); provided , however
, that any event described in clauses (A), (B) and (D) of
this Section 8(a)(ii) shall constitute Cause only if
Executive fails to cure such event, to the reasonable satisfaction
of the Board, within 10 days after receipt from the Company of
written notice of the event which constitutes Cause.
(iii)
If Executive’s employment is terminated by the Company for
Cause or if Executive resigns without Good Reason, Executive shall
be entitled to receive:
(A)
the Base Salary through the date of termination;
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(B)
any Annual Bonus earned but unpaid as of the date of termination
for any previously completed fiscal year;
(C)
reimbursement for any unreimbursed business expenses properly
incurred by Executive in accordance with Company policy prior to
the date of Executive’s termination; and
(D)
such Employee Benefits, if any, as to which Executive may be
entitled under the employee benefit plans of the Company or any of
its affiliates, including, without limitation, any vested accrued
benefit under the SERP (the amounts described in clauses
(A) through (D) hereof being referred to as the
“Accrued Rights”).
Following such
termination of Executive’s employment by the Company for
Cause or resignation by Executive without Good Reason, except as
set forth in this Section 8(a)(iii), Section 8(d) or
Sections 12(h), (l), (n) and (o), Executive shall have no
further rights to any compensation or any other benefits under this
Agreement. Executive’s rights with respect to any
equity awards in the case of her termination by the Company for
Cause or her resignation without Good Reason shall be as provided
in the applicable equity award agreements and the plan under which
such awards were granted.
b.
Disability or Death .
(i)
The Employment Term and Executive’s employment hereunder
shall terminate upon Executive’s death and may be terminated
by the Company if Executive becomes physically or mentally
incapacitated and is therefore reasonably likely to be unable for a
period of six consecutive months or for an aggregate of nine months
in any twelve consecutive month period to perform Executive’s
material duties (such incapacity is hereinafter referred to as
“Disability”). Any question as to the existence
of the Disability of Executive as to which Executive and the
Company cannot agree shall be determined in writing by a qualified
independent physician mutually acceptable to Executive and the
Company. If Executive and the Company cannot agree as to a
qualified independent physician, each shall appoint such a
physician and those two physicians shall select a third who shall
make such determination in writing. The determination of
Disability made in writing to the Company and Executive shall be
final and conclusive for all purposes of the Agreement.
(ii)
Upon termination of Executive’s employment hereunder for
Disability or death, Executive or Executive’s estate (as the
case may be) shall be entitled to receive:
(A)
the Accrued Rights; and
(B)
an Annual Bonus for the fiscal year in which Executive’s
termination occurs, payable in a lump sum payment, equal to the
greater of (i) a pro-rata portion of Executive’s target
Annual Bonus for such year (determined by multiplying the target
Annual Bonus by a fraction, the numerator of which is the number of
days during the performance year that Executive is employed by the
Company and the denominator of which is 365), or (ii) such
other amount as may be provided in the Company’s annual bonus
plan for the fiscal year in which Executive’s termination
occurs.
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Following
Executive’s termination of employment due to death or
Disability, except as set forth in this Section 8(b)(ii),
Section 8(d) or Sections 12(h), (l), (n) and (o),
Executive shall have no further rights to any compensation or any
other benefits under this Agreement. Executive’s rights
with respect to any equity awards in the case of her termination of
employment due to death or Disability shall be as provided in the
applicable equity award agreements and the plan under which such
awards were granted.
c.
By the Company without Cause or Resignation by Executive for
Good Reason .
(i)
The Employment Term and Executive’s employment hereunder may
be terminated by the Company without Cause (other than by reason of
death or Disability) or by Executive’s resignation for Good
Reason.
(ii)
For purposes of this Agreement, “Good Reason” shall
mean, without Executive’s written consent, (A) a
reduction in Executive’s Base Salary as then in effect,
(B) a reduction in Executive’s target Annual Bonus to
less than 60% of the Base Salary or a material reduction by the
Company of Employee Benefits to which Executive is entitled (other
than an overall reduction in benefits that affects substantially
all full-time employees of the Company and its affiliates),
(C) Executive’s removal from the position of Executive
Vice President, General Counsel and Corporate Secretary of the
Company, (D) a material adverse change in Executive’s
authority, duties and responsibilities or reporting lines,
(E) a relocation of Executive’s principal place of
employment with the Company of more than 35 miles from
Executive’s then current work location, (F) the
Company’s failure to pay amounts to which Executive is
entitled under this Agreement, or (G) the Company’s
giving written notice that it elects not to extend the Employment
Term pursuant to Section 1 of this Agreement (but this clause
(G) shall apply only if Executive would be less than age 62 at
the end of the Employment Term); provided that any event
described in clauses (A) through (F) above shall
constitute Good Reason only if the Company fails to cure such event
within 30 days after receipt from Executive of written notice of
the event which constitutes Good Reason; provided ,
further , that Good Reason shall cease to exist for an event
described in clauses (A) through (F) above on the 60th
day following the later of its occurrence or Executive’s
knowledge thereof, unless Executive has given the Company written
notice thereof prior to such date.
(iii)
Other than as provided in Section 8(c)(iv) below, if
Executive’s employment is terminated by the Company without
Cause (other than by reason of death or Disability) or if Executive
resigns for Good Reason, Executive shall be entitled to
receive:
(A)
the Accrued Rights;
(B)
a lump sum severance payment equal to one (the “Severance
Factor”) times the sum of (i) Executive’s then
Base Salary, plus (ii) Executive’s target Annual Bonus
for the fiscal year in which Executive’s termination pursuant
to this Section 8(c)(iii) occurred; provided that
the amount described in this clause (B) shall be in lieu of
any other cash severance payable to Executive under any other
plans, programs or arrangements of the Company or its affiliates
(but excluding the SERP) up to the amount described in this clause
(B);
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her (C) subject to Executive’s
continued compliance with the provisions of Sections 9 and 10 of
this Agreement (other than a breach that is insubstantial and
insignificant, taking into account all of the circumstances), for a
period of 12 months following the date of such termination (the
“Welfare Benefits Continuation Period”), continued
participation in the health and welfare plans maintained by the
Company or any of its affiliates as in effect from time to time
during the Welfare Benefits Continuation Period, on the same basis
as the Company and its affiliates provides such plans for its then
actively employed executives (which may include, without
limitation, medical, dental, disability and life insurance), and
the Company and Executive shall share the costs of the continuation
of such coverage in the same proportion as such costs were shared
immediately prior to Executive’s termination; provided
, however , that (i) such participation shall
terminate, or the benefits under such plan shall be reduced, if and
to the extent Executive becomes covered (or is eligible to become
covered) during such period by plans of a subsequent employer or
other entity to which Executive provides services providing
comparable benefits or if Executive fails to pay any required
contribution or premium, (ii) during the Welfare Benefits
Continuation Period, the benefits provided in any one calendar year
shall not affect the amount of benefits to be provided in any other
calendar year, and (iii) the reimbursement of an eligible
expense must be made no later than December 31 of the year
after the year in which the expense was incurred. Such
coverage shall be credited against the time period that Executive
and Executive’s dependents are entitled to receive continued
coverage under the Consolidated Omnibus Budget Reconciliation Act
of 1985, as amended. To the extent any benefits described in
this Section 8(c)(iii)(C) cannot be provided under the
Company’s welfare plans, the Company shall pay to Executive a
lump sum amount equal to the amount that such coverage would have
cost the Company for the remainder of the Welfare Benefits
Continuation Period. Executive’s rights pursuant to
this Section 8(c)(iii)(C) shall not be subject to
liquidation or exchange for another benefit; and
(D)
the Compensation Committee of the Company may, but need not,
provide that (i) all or any part of Executive’s unvested
stock options then held by Executive shall become vested and
exercisable as of the date of termination and may continue to be
exercisable for a designated period of time, but in no event to
exceed the original full term of the option; and/or that
(ii) all or any part of vesting restrictions on other
outstanding equity awards, including but not limited to the
Restricted Shares described in Exhibit A, then held by
Executive shall vest and cease to be restricted as of the date of
termination. Such decision may be based on such factors, if
any, as the Compensation Committee shall determine, including, but
not limited to, the Company’s financial condition and market
conditions. Notwithstanding the foregoing, to the extent that
any portion of Executive’s outstanding equity awards are
subject to market or performance criteria (other than service
requirements) affecting vesting or exercisability and such market
or performance criteria have been satisfied as of the date of
termination, that portion of the award shall be deemed fully vested
as of the date of termination.
(iv)
If Executive’s employment is terminated by the Company
without Cause (other than by reason of death or Disability) or if
Executive resigns for Good Reason at any time during the period
beginning on the date of a Change in Control (as defined in the
Superior Essex
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Inc. Amended and Restated 2005 Incentive Plan)
and ending two years after the date of such Change in Control,
Executive shall be entitled to receive the benefits as provided
under Section 8(c)(iii)(A), (B) and (C), except that the
Welfare Benefits Continuation Period as defined in
Section 8(c)(iii)(C) shall be 24 months, and the
Severance Factor for purposes of
Section 8(c)(iii)(B) shall be two (2).
(v)
Following Executive’s termination of employment by the
Company without Cause (other than by reason of Executive’s
death or Disability) or by Executive’s resignation for Good
Reason, except as set forth in this Section 8(c),
Section 8(d) or Sections 12(h), (l), (n) and (o),
Executive shall have no further rights to any compensation or any
other benefits under this Agreement. Except as set forth
herein, Executive’s rights with respect to any equity awards
in the case of her termination by the Company without Cause or her
resignation for Good Reason shall be as provided in the applicable
equity award agreements and the plan under which such awards were
granted.
d.
Effect of a Change in Control on Equity Awards .
(i)
Accelerated Vesting . In addition to the rights described
above, upon the occurrence of a Change in Control (as defined in
the Superior Essex Inc. Amended and Restated 2005 Incentive Plan),
(A) all of Executive’s outstanding stock options and any
other equity awards in the nature of appreciation rights
(collectively, “Appreciation Rights”), shall become
fully vested and exercisable as of the date of the Change in
Control, and (B) all time-based or performance-based vesting
restrictions on Executive’s outstanding restricted stock,
restricted stock units and other equity awards (collectively,
“Restricted Rights”) shall lapse as of the date of the
Change in Control.
(ii)
Settlement of Awards in Certain Events . The following
shall apply only upon the occurrence of a Change in Control in
which the consideration paid to Company shareholders is
consideration other than shares in the resulting or surviving
entity that are listed for trading on a nationally recognized
exchange. In such event, (A) all of Executive’s
Appreciation Rights shall vest and be cancelled simultaneously with
the Change in Control and Executive shall be entitled to receive
therefor the same transaction consideration as if she were a
shareholder of the Company holding the number of shares of Company
common stock having a fair market value, as of the effective time
of the Change in Control, equal to (x) the excess, if any, of
the value of the consideration per share to be received by Company
shareholders in such Change of Control, over the exercise price for
such Appreciation Right, less (y) applicable withholding
taxes; and (B) all of Executive’s Restricted Rights
shall vest and be cancelled simultaneously with the Change in
Control and Executive shall be entitled to receive therefor the
same transaction consideration as if she were a shareholder of the
Company holding the number of shares of Company common stock having
a fair market value, as of the effective time of the Change in
Control, equal to the value of such Restricted Rights, less
applicable withholding taxes.
e.
Expiration of Employment Term . Unless the parties
otherwise agree in writing, continuation of Executive’s
employment with the Company or any affiliate beyond the expiration
of the Employment Term shall be deemed an employment at-will and
shall not be deemed to extend any of the provisions of this
Agreement and Executive’s employment may
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thereafter be
terminated at will by either Executive or the Company (or
affiliate); provided that the provisions of Sections 9, 10,
11 and 12(n) of this Agreement shall survive any termination
of this Agreement or Executive’s termination of employment
hereunder; and provided further that if Executive shall have
given notice of intent to resign for Good Reason pursuant to clause
8(c)(ii)(G) as a result of the Company’s election not to
extend the Employment Term, the provisions of
Section 8(c) and Sections 12(h), (l) and
(o) shall continue to apply with respect to such
resignation.
f.
Notice of Termination . Any purported termination of
employment by the Company or by Executive (other than due to
Executive’s death) shall be communicated by Notice of
Termination to the other party hereto in accordance with
Section 12(i) hereof. For purposes of this
Agreement, a “Notice of TerminationR
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