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Management Retention Agreement

Employee Retention Agreement

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 This Employee Retention Agreement involves

OLYMPIC STEEL INC | OLYMPIC STEEL, INC

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Title: MANAGEMENT RETENTION AGREEMENT
Governing Law: Ohio     Date: 8/23/2016
Industry: Misc. Fabricated Products     Sector: Basic Materials

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EXHIBIT 10.39

   

MANAGEMENT RETENTION AGREEMENT

 

THIS MANAGEMENT RETENTION AGREEMENT is entered into on this _____ day of ____________________, 20___ by and between OLYMPIC STEEL, INC. (the "Company"), and _________________________ ("Employee").

 

WITNESSETH:

 

WHEREAS, Employee is an executive officer of the Company and an integral part of its management;

 

WHEREAS, the Company desires to assure itself of continuity of management in the event of any threatened or actual Change in Control (as hereafter defined);

 

WHEREAS, the Company desires to provide inducements for Employee not to engage in activity competitive with the Company;

 

WHEREAS, the Company desires to assure itself, in the event of any threatened or actual Change in Control, of the continued performance of services by Employee on an objective and impartial basis and without distraction by concern for his employment status and security; and

 

WHEREAS, Employee is willing to continue in the employ of the Company but desires assurance that his responsibilities and status as an executive of the Company will not be adversely affected by any threatened or actual Change in Control.

 

NOW, THEREFORE, the Company and Employee agree as follows:

 

1.      Operation of Agreement . This Agreement shall be effective and binding immediately upon its execution, but, anything in this Agreement to the contrary notwithstanding, this Agreement shall not be operative unless and until there has been a Change in Control while Employee is in the employ of the Company. The term "Change in Control" shall mean, but not be limited to: (a) the first purchase of shares pursuant to a tender offer or exchange (other than a tender offer or exchange by the Company and/or any affiliate thereof) for all or part of the Company's Common Shares of any class or any securities convertible into such Common Shares and Employee has elected not to tender or exchange his Common Shares; (b) the receipt by the Company of a Schedule 13D or other advice indicating that a person is the "beneficial owner" (as that term is defined in Rule 13d-3 under the Securities Exchange Act of 1934) of twenty percent (20%) or more of the Company’s Common Shares calculated as provided in paragraph (d) of said Rule 13d-3; (c) the date of approval by shareholders of the Company of an agreement providing for any consolidation or merger of the Company in which the Company will not be the continuing or surviving corporation or pursuant to which shares of capital stock, of any class or any securities convertible into such capital stock, of the Company would be converted into cash, securities, or other property, other than a merger of the Company in which the holders of common stock of all classes of the Company immediately prior to the merger would have the same proportion of ownership of common stock of the surviving corporation immediately after the merger; (d) the date of approval by shareholders of the Company of any sale, lease, exchange, or other transfer (in one transaction or a series of related transactions) of all or substantially all the assets of the Company; (e) the adoption of any plan or proposal for the liquidation (but not a partial liquidation) or dissolution of the Company; or (f) the date (the "Measurement Date") on which the individual who at the beginning of a two consecutive year period ending on the Measurement Date, ceases, for any reason, to constitute at least a majority of the Board of Directors of the Company, unless the election, or the nomination for election by the Company's shareholders, of each new director during such two-year period was approved by an affirmative vote of the directors (including Employee) then still in office who were directors at the beginning of said two-year period. Notwithstanding the foregoing, (i) if any person's ownership interest in the Company increases to 20% or more, solely as a result of the Company repurchase of its shares, or (ii) Michael D. Siegal increases his ownership interest to 20% or more, such ownership shall not be considered a Change in Control for purposes of subparagraph (b) above.

 

 

 


 

 

Upon the occurrence of a Change in Control while Employee is in the employee of the Company, this Agreement shall become operative.

 

 

2.

Employment, Contract Period .

 

(a)     Subject to the terms and conditions of this Agreement, upon the occurrence of a Change in Control, the Company shall continue to employ Employee and Employee shall continue in the employ of the Company for the period specified in paragraph 2(b) (the "Contract Period"), in the position and with the duties and responsibilities set forth in Section 3.

 

(b)     The Contract Period shall commence on the date of occurrence of a Change in Control and, subject only to the provisions of Section 5 and of Section 6 below, shall continue for a period of one (1) year to the close of business on the first anniversary of such date.

 

3.      Position, Responsibilities, Duties . At all times during the Contract Period, Employee shall hold the position and have the duties and responsibilities held by Employee as ___________________________________ of the Company (Employee's position as of the date of this Agreement) or such other position, responsibilities, and duties as Employee may have had immediately before the Change in Control occurred, or to which the Company and Employee may agree in writing. Throughout the Contract Period, Employee shall devote substantially all of his time and attention during normal business hours to the business and affairs of the Company, consistent with past practice, except for reasonable vacations and periods of illness or incapacity, but nothing in this Agreement shall preclude Employee from devoting reasonable periods of time to charitable and community activities, and from managing his personal investments.

 

 

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4.      Compensation During Contract Period .

 

(a)     During the Contract Period, the Company shall pay Employee: (i) a salary at a rate not less than Employee's base salary in effect immediately before the occurrence of a Change in Control, or such higher rate as may be determined from time to time by the Board of Directors of the Company, and (ii) bonuses in amounts which are not less than the amounts Employee would have received during the Contract Period if the determination of bonuses during the Contract Period was made on the same basis as in effect immediately before the occurrence of a Change in Control. Payments of direct compensation pursuant to this paragraph 4(a) shall be made periodically on the same schedule as in effect immediately before the occurrence of a Change in Control.

 

(b)     During the Contract Period, Employee shall be and continue to be a full participant in any and all benefit plans in which executives of the Company participate and which are in effect immediately before the occurrence of the Change in Control, including, without limitation, the Employees' 401(k) Plan, Profit Sharing Plan, automobile allowance, country club dues and any group insurance, medical, dental, hospitalization or life insurance, disability insurance and other employee benefit plans, programs, or arrangements or any equivalent successor plans, programs, or arrangements that may thereafter be adopted by the Company and provide Employee at least the same reward opportunities that were provided to him immediately before the occurrence of such Change in Control (collectively, "Employee Benefits"). Nothing in this Agreement shall impair or diminish the ability of the Company to modify, amend or eliminate any Employee Benefit prior to a Change in Control.

 

(c)     During the Contract Period Employee shall be entitled to perquisites, including, without limitation, an office, secretarial and clerical staff, in each case at least equal to those attached to his office immediately before the occurrence of the Change in Control, as well as to reimbursement, upon proper accounting, of reasonable expenses and disbursements incurred by him in the course of his duties.

 

5.      Effect of Death or Disability .

 

(a)     If Employee dies during the Contract Period, the Company shall pay Employee's designated beneficiary (or, in the event of the decease of or failure to designate a beneficiary, Employee's personal representative) the base salary, provided for in paragraph 4(a) above for a 12-month period commencing thirty days (30) after the date of death, but without prejudice to any payments otherwise due Employee in respect of his death.

 

 

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(b)     If, during the Contract Period and before his employment hereunder is otherwise terminated, Employee is prevented due to illness or accident from performing his duties under this Agreement for a period of six consecutive months, the Contract Period shall be deemed to end at the end of such six month period, but without prejudice to any payments otherwise due Employee in respect of his disability. During the period of any such disability before the end of the Contract Period, the Company shall pay Employee the compensation provided for in Section 4, at the rate being paid at the onset of the disability, reduced by any payments paid to Employee for the same period because of disability under any disability or pension plan of the Company. If employee recovers from his disability before the end of the Contract Period, he shall be reinstated as an active employee for the remainder of the Contract Period under and subject to all of the terms of this Agreement.

 

6.      Termination Following a Change in Control . Following a Change in Control, Employee's employment may be terminated during the Contract Period:

 

(a)     by the Company for "cause." For purposes of this Agreement, "cause" means Employee (i) is convicted of a felony, a crime of moral turpitude or any crime involving the Company (other than pursuant to actions taken at the direction or with the approval of the Board of Directors); (ii) is found by reasonable determination of the Board of Directors made in good faith, to have engaged after the Change in Control in (A) willful misconduct, (B) willful or gross neglect, (C) fraud, (D) misappropriation, or (E) embezzlement in the performance of his duties hereunder; or (iii) breaches in any material respect the terms and provisions of this Agreement and fails to cure such breach within ten days following written notice from the Company specifying such breach. The Company may terminate the Employee's employment hereunder on written notice given to the Employee at any time following the occurrence of any of the events described in clauses (i) and (ii) above and on written notice given to the Employee at any time not less than 30 days following the occurrence of any of the events described in clause (iii) above. The Employee shall have no right to receive any compensation or benefit hereunder on and after the effective date of the notice provided in the preceding sentence other than salary, bonus and other benefits earned and accrued, and reimbursement under this Agreement for expenses incurred, prior to the effective date of such notice.

 

(b)     by Employee for "good reason." For purposes of this Agreement, "good reason" shall mean the occurrence of any of the following:

 

(i)     any reduction in aggregate direct remuneration, or any material reduction in position, responsibilities, or duties provided for pursuant to this Agreement or in the aggregate of Employee Benefits, perquisites, or fringe benefits provided for pursuant to this Agreement;

 

 

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