Exhibit 10(B)1
December 31, 2008
Mr. Robert A. Paul
c/o Ampco-Pittsburgh Corporation
600 Grant St., Suite 4600
Pittsburgh, PA 15219
Dear Bob:
This Agreement amends and restates
in its entirety your November 1, 1988 Agreement with
Ampco-Pittsburgh Corporation (the
“Corporation”).
The Corporation recognizes that your
contribution to the success of the Corporation has been substantial
and desires to assure the Corporation of your continued employment.
In this connection, the Board of Directors of the Corporation (the
“Board”) recognizes that, as is the case with other
publicly held corporations, the possibility of a change in control
may exist and that such possibility, and the uncertainty that it
may raise among the Corporation’s management, may result in
the departure or distraction of management personnel to the
detriment of the Corporation and its stockholders.
The Board has determined that
appropriate steps should be taken to reinforce and encourage the
continued attention and dedication of members of the
Corporation’s management, including you, to their assigned
duties without distraction in the face of potentially disturbing
circumstances arising from the possibility of a change in control
of the Corporation.
In order to induce you to remain in
the employ of the Corporation, the Corporation agrees that you
shall receive the severance benefits set forth in this letter
agreement (“Agreement”) in the event your employment
with the
Corporation is terminated subsequent to a
“Change in Control” (as defined in Section 2
hereof) under the circumstances described below.
Term of Agreement
. This Agreement will commence on
the date hereof and shall continue in effect for twenty-four
(24) months from the date hereof; provided ,
however , that commencing on December 31, 2010 and on
each anniversary thereafter, the term of this Agreement shall
automatically be extended for one (1) additional year unless,
not later than thirty (30) days prior to such date, the
Corporation shall have given notice that it does not wish to extend
this Agreement; provided , further , however ,
that if a Change in Control shall have occurred during the original
or extended term of this Agreement, this Agreement cannot be
cancelled.
Change in Control
.
No benefits shall be payable
hereunder unless there shall have been a Change in Control as set
forth below. For purposes of this Agreement, a “Change in
Control” shall be deemed to have occurred if:
any “person” (as defined
in Sections 13(d) and 14(d) of the Exchange Act) other than the
persons or the group of persons in control of the Corporation on
the date hereof is or becomes the “beneficial owner”
(as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Corporation representing fifty
percent (50%) or more of the combined voting power of the
Corporation’s then outstanding securities;
within any period of
two (2) consecutive years (not including any period prior to
the execution of this Agreement) there shall cease to be a majority
of the Board comprised as follows: individuals who at the beginning
of such period constitute the Board and any new director(s) whose
election was approved by a vote of at least two-thirds (
2
/
3 ) of the directors then
still in office who either were directors at the beginning of the
period or whose election or nomination for election was previously
so approved;
the shareholders of the Corporation
approve a merger of, or consolidation involving, the Corporation in
which (A) the Corporation’s Common Stock, par value one
dollar ($1.00) per share (such stock, or any other securities of
the Corporation into which such stock shall have been converted
through a reincorporation, recapitalization or similar transaction,
hereinafter called “Common Stock of the Corporation”),
is converted into shares or securities of another corporation, or
into cash or other property, or (B) the Common Stock of the
Corporation is not converted as described in Clause (A), but in
which more than forty percent (40%) of the Common Stock of the
surviving corporation in the merger is owned by Shareholders other
than those who owned such amount prior to the merger; or any other
transaction after which the Corporation’s Common Stock is no
longer to be publicly traded; in each case, other than a
transaction solely for the purpose of reincorporating the
Corporation in another jurisdiction or recapitalizing the Common
Stock of the Corporation; or
the shareholders of the Corporation
approve a plan of complete liquidation of the Corporation, or an
agreement for the sale or disposition by the Corporation of all or
substantially all the Corporation’s assets, either of which
is followed by a distribution of all or substantially all of the
proceeds to the shareholders.
Agreement of Employee
. You agree that in the event of a
Potential Change in Control of the Corporation, you will not
terminate employment with the Corporation for any reason until the
occurrence of a Change in Control of the Corporation.
For purposes of this Agreement, a
“Potential Change in Control of the Corporation” shall
be deemed to have occurred if (i) the Corporation enters into
an agreement, the consummation of which would result in the
occurrence of a Change in Control, (ii) any person (including
the Corporation) publicly announces an intention to take or to
consider taking actions, which if consummated would constitute a
Change in Control, or (iii) the Board adopts a resolution to
the effect that, for purposes of this Agreement, a Potential Change
in Control of the Corporation has occurred.
Termination Following a Change in
Control .
If any of the events described in
Section 2 constituting a Change in Control shall have
occurred, you shall be entitled to the benefits provided in
Section 5(d) upon the termination of your employment within
twenty-four (24) months after the Change in Control has
occurred, or pursuant
to Section 6 prior to the Change in
Control, unless such termination is (i) because of your death
or Disability, (ii) by the Corporation for Cause, or
(iii) by you other than for Good Reason.
For purposes of this Agreement,
“Disability” shall mean that if, as a result of your
incapacity due to physical or mental illness, you shall have been
absent from the full-time performance of your duties with the
Corporation for six (6) consecutive months, and within thirty
(30) days after written notice of termination shall have been
given to you, you shall not have returned to the full-time
performance of your duties.
For purposes of this Agreement,
termination by the Corporation of your employment for
“Cause” shall mean termination upon:
the willful and
continued failure by you to substantially perform duties consistent
with your position with the Corporation (other than any such
failure resulting from incapacity due to physical or mental illness
or termination by you for Good Reason), after a demand for
substantial performance is delivered to you by the Board, together
with a copy of the resolution of the Board that specifically
identifies the manner in which the Board believes that you have not
substantially performed your duties, which resolution must be
passed by at least two-thirds ( 2 / 3 ) of the entire Board at a
meeting called for the purpose and after an opportunity for you and
your counsel to be heard by the Board, and you have failed to
resume substantial performance of
your duties on a continuous basis within
fourteen (14) days of receiving such demand,
the willful engaging
by you in conduct that is demonstrably and materially injurious to
the Corporation, monetarily or otherwise, as set forth in a
resolution of the Board, which resolution must be passed by at
least two-thirds ( 2
/
3 ) of the entire Board at a
meeting called for the purpose and after an opportunity for you and
your counsel to be heard by the Board, or
your conviction of a felony, or
conviction of a misdemeanor involving assets of the
Corporation.
For purposes of this
Section 4(c), no act, or failure to act, on your part shall be
deemed “willful” unless done, or omitted to be done, by
you not in good faith and without reasonable belief that your
action or omission was in the best interest of the
Corporation.
For purposes of this Agreement,
“Good Reason” shall mean, without your express written
consent, the occurrence after a Change in Control of any one or
more of the following conditions, which condition continues without
timely and complete remedy by the Corporation after notice, as
provided below:
If, following a Change in Control,
there is no Parent Corporation and your status as Chairman and
Chief Executive Officer of the Corporation shall not continue after
such Change in Control or, if following a
Change in Control, there is a Parent
Corporation, as defined below, you shall not be Chairman and Chief
Executive Officer of the Parent Corporation, or, in either case,
you shall not be afforded the authority, responsibilities and
prerogatives of such position and report directly to the Board of
Directors of the Corporation or the Parent Corporation, as the case
may be;
a reduction by the Corporation in
your base salary as in effect immediately before the Change in
Control, a failure to increase such base salary at the same
intervals as prevailed before the Change in Control in an amount at
least equal to the same percentage increase as the last increase
prior to the Change in Control, or a reduction in bonus after the
Change in Control over the last bonus paid before the Change in
Control unless there are equivalent reductions in bonuses for all
executives of the Corporation;
the requirement that you be based at
a location in excess of twenty-five (25) miles from the
location where you are currently based;
the failure by the Corporation to
continue in effect the Supplemental Executive Retirement Plan
(“SERP”) or any other of the Corporation’s
employee benefit plans, policies, practices or arrangements in
which you participate or under which you are entitled to benefits,
or the failure by the Corporation to continue your participation
therein or benefits thereunder on substantially the same basis,
both in terms of the amount of benefits provided and the level of
your participation relative to other participants, as existed
immediately prior to the Change in Control; or
the breach of this Agreement by the
Corporation because of the Corporation’s failure to obtain a
satisfactory agreement from any successor to the Corporation to
assume and agree to perform this Agreement, as contemplated in
Section 7.
The foregoing notwithstanding, you
shall notify the Corporation within ninety (90) days of the
initial existence of a particular condition described above in this
Section 4(d), and the Corporation shall have thirty
(30) days from such notice completely to remedy such
particular condition so that the you are in the same position as if
the condition had never occurred. If the Corporation timely and
completely remedies the condition as required above, then the
particular occurrence of the particular condition for which you
gave notice shall no longer constitute Good Reason. If the
Corporation does not timely and completely remedy the particular
occurrence of the particular condition for which you gave notice,
you shall be deemed to terminate employment for Good Reason on the
31st day following your notice to the Corporation.
For purposes of this Agreement,
“Parent Corporation” shall mean any
“affiliate” of the Corporation that is the ultimate
controlling entity of the Corporation or its successor and shall
include, without limiting the generality of the foregoing, any
entity (and affiliated persons and entities) that beneficially
owns, directly or indirectly, fifty percent (50%) or more of
the combined voting power of the then outstanding voting stock of
the Corporation, or any entity that beneficially owns, directly or
indirectly, forty percent (40%) or more (but less
than fifty percent (50%) of the combined
voting power of the then outstanding voting stock of the
Corporation if such entity (or affiliated persons or entities) has
at least one representative on the Board of Directors of the
Corporation.
“Good Reason” may be
established notwithstanding your
