Amended and
Restated Employment Agreement
This Amended and Restated
Employment Agreement (this “ Agreement
”), dated as of June 16, 2009 but retroactively
effective as of May 27, 2008 (the “ Effective
Date ”), is between Sterling Chemicals, Inc. , a
Delaware corporation (“ Employer ”), and
John V. Genova
(“ Executive ”).
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1.
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Employer and Executive are parties
to that certain Employment Agreement dated effective as
May 27, 2008 (the “ Existing Employment
Agreement ”), pursuant to which Employer is employing
Executive as its President and Chief Executive Officer.
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2.
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Employer and Executive desire to
amend the Existing Employment Agreement in certain respects and to
restate the Existing Employment Agreement, as so amended, in its
entirety.
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Now, Therefore , in
consideration of their mutual promises and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the Existing Employment Agreement is hereby amended
and restated to read in its entirety as follows:
1.
Definitions . As used in this Agreement, the following terms
have the following meanings:
“
Accounting Firm ” means, as of the time of
determination, a nationally recognized accounting firm or employee
benefits firm acceptable to Employer and Executive; provided,
however , that such firm has not provided any services to
Employer or Executive at any time during the immediately preceding
three-year period.
“
Affiliate ” means, with respect to any entity,
any other corporation, organization, association, partnership, sole
proprietorship or other type of entity, whether incorporated or
unincorporated, directly or indirectly controlling or controlled by
or under direct or indirect common control with such
entity.
“
Agreement ” has the meaning specified in the
introductory paragraph hereof.
“
Annual Period ” means the time period of each
year beginning on the first day of the Employment Term and ending
on the day before the anniversary of that date.
“ Base
Salary ” has the meaning specified in
Section 5(a).
“ Base
Salary Component ” has the meaning specified in
Section 7(e).
“
Benefit Plan ” means any employee benefit plan
(including any employee benefit plan within the meaning of
Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended), program, arrangement or practice maintained,
sponsored or provided by Employer or any subsidiary, including
those relating to bonuses, incentive compensation, retirement
benefits, stock options, stock ownership or stock awards,
healthcare or medical benefits, disability benefits, death
benefits, disability, life, accident or travel insurance, sick
leave, vacation pay or termination pay.
“
Board ” means the Board of Directors of
Employer.
“
Bonus Component ” has the meaning specified in
Section 7(e).
“
Business Expenses ” has the meaning specified
in Section 5(e).
“
Cause ” means a finding by the Board of acts or
omissions constituting, in the Board’s reasonable judgment,
any of the following occurring during the Employment Term
:
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(i)
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the
commission by Executive of (A) fraud, (B) acts of
dishonesty which are injurious to Employer (monetarily or
otherwise) in any material respect or (C) an act constituting
a breach in any material respect of the duty of loyalty (as defined
by the laws of the State of Delaware) to Employer or its
Affiliates;
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(ii)
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conduct (including a failure to act)
by Executive that is materially detrimental in a monetary manner to
Employer or that prejudices, in any material respect, the
reputation of Employer in the fields of business in which it is
engaged or with the investment community or the public at large,
but only if Executive knew, or should have known, that such conduct
could have such result;
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(iii)
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acts or omissions of Executive
constituting a violation of any of his material obligations under
this Agreement;
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(iv)
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Executive’s failure to comply,
in any material respect, with the policies of Employer or its
Affiliates , specifically including those concerning alcohol
or drugs, ethics, equal employment opportunity, harassment or
compliance with laws;
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(v)
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Executive’s material
insubordination to the Board or willful failure to observe and
comply with all lawful and ethical and reasonable directions and
instructions of the Board;
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(vi)
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subject to Section 4(b),
Executive’s failure to devote his full working time and best
efforts to the performance of his responsibilities to Employer or
its Affiliates;
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(vii)
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Executive’s conviction of, or
entry of a plea agreement or consent decree or similar arrangement
with respect to, a felony or any violation of federal or state
securities laws; or
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(viii)
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Executive’s failure to
cooperate with any investigation or inquiry authorized by the Board
or conducted by a governmental authority related to
Employer’s or an Affiliate’s business or
Executive’s conduct related to Employer or an
Affiliate.
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“
Change of Control ” means the occurrence of any
of the following events:
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(i)
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the
acquisition by 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 ”), other than
Resurgence Asset Management, L.L.C. and/or any of its or its
affiliates’ managed funds or accounts (“
Resurgence ”), of securities of Employer if,
immediately thereafter, such Person is the beneficial owner (within
the meaning of Rule 13d-3 promulgated under the Exchange Act)
of 50% or more of the combined voting power of the then-outstanding
voting securities of Employer entitled to vote generally in the
election of directors (the “ Outstanding Company Voting
Securities ”); provided, however, that the
following acquisitions shall not constitute a Change of Control:
(A) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by Employer or any of its
Affiliates; or (B) any acquisition by any corporation pursuant
to a transaction that complies with subclauses (iii)(A), (iii)(B)
and (iii)(C) of this definition;
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(ii)
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the
time at which individuals who, within any 12-month period,
constitute the Board (the “ Incumbent Board
”) cease for any reason to constitute at least a majority of
the Board; provided, however, that any individual whose
election, or nomination for election by Employer’s
stockholders, 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
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;
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(iii)
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consummation of a reorganization,
merger, statutory share exchange or consolidation or similar
corporate transaction involving Employer or any of its
subsidiaries, a disposition of assets by Employer or the
acquisition of assets or stock of another entity by Employer or any
of its subsidiaries (each, a “
Business
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Combination
”), in each case
unless, following such Business Combination, (A) all or
substantially all of the individuals and entities that were the
beneficial owners of the Outstanding Company Voting Securities
immediately prior to such Business Combination beneficially own,
directly or indirectly, more than 50% of the then-outstanding
voting securities entitled to vote generally in the election of
directors of the corporation resulting from such Business
Combination (including a corporation that, as a result of such
transaction, owns Employer or has purchased Employer’s assets
in a disposition of 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 Voting Securities, (B) no Person
(excluding Resurgence or any employee benefit plan (or related
trust) of Employer or such corporation resulting from such Business
Combination) beneficially owns, directly or indirectly, 50% or more
of 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 a majority 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
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(iv)
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approval by the stockholders or
other relevant stakeholders of Employer of a complete liquidation
or dissolution of Employer.
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“
COBRA ” has the meaning specified in
Section 7(e).
“
Code ” means the Internal Revenue Code of 1986,
as amended from time to time. Reference to a Code section shall
include (i) such section and any comparable section or
sections of any future legislation that amends, supplements or
supersedes such section and (ii) all rulings, regulations,
notices, announcements, guidance and other pronouncements issued by
the U.S. Treasury Department, the Internal Revenue Service and any
court of competent jurisdiction that relate to such
section.
“
Compensation Payment ” has the meaning
specified in Section 7(a).
“
Competitive Position ” has the meaning
specified in Section 7(e).
“
Confidential Information ” means, without
limitation, all documents or information, in whatever form or
medium, concerning or evidencing sales, costs, pricing, strategies,
forecasts and long range plans, financial and tax information,
personnel information, business, marketing and operational
projections, plans and opportunities, customer, vendor and supplier
information, project and prospect locations and leads and
production information but excluding any such information that is
or becomes generally available to the public other than as a result
of any breach of this Agreement or other unauthorized disclosure by
Executive.
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“
Correction Period ” has the meaning specified
in Section 6(c).
“
Effective Date ” has the meaning specified in
the introductory paragraph hereof.
“
Employer ” has the meaning specified in the
introductory paragraph hereof.
“
Employment Term ” has the meaning specified in
Section 3.
“
Employment Termination Date ” means the
effective date of termination of Executive’s employment as
determined under Section 6(g).
“
Excise Tax ” has the meaning specified in
Section 7(g).
“
Executive ” has the meaning specified in the
introductory paragraph hereof.
“ Good
Reason ” means, with respect to Executive, any of the
following actions or failures to act by Employer (unless such act
or failure to act was with the express written consent of
Executive):
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(i)
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a
material adverse change in Executive’s reporting
responsibilities, titles or elected or appointed offices as in
effect immediately prior to the effective date of such change,
including any change caused by the removal of Executive from, or
the failure to re-elect Executive to, any material corporate office
of Employer held by Executive immediately prior to such effective
date but excluding any such change that occurs in connection with a
termination of Executive’s employment in accordance with the
terms of this Agreement;
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(ii)
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the
assignment to Executive of duties and/or responsibilities that are
materially inconsistent with Executive’s status, positions,
duties, responsibilities and functions with Employer immediately
prior to the effective date of such assignment;
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(iii)
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a
reduction in Executive’s Base Salary or target award
opportunity under the ICP, in each case, as in effect immediately
prior to the effective date of such reduction;
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(iv)
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the
failure of Employer to maintain employee benefit plans, programs,
arrangements and practices entitling Executive to benefits that, in
the aggregate, are at least as favorable to Executive as those
available to Executive under the Benefit Plans in which he or she
was a participant immediately prior to the effective date of such
failure; provided, however , that the amendment,
modification or discontinuance of any or all such employee benefit
plans, programs, arrangements or practices by Employer shall not
constitute “ Good Reason ” hereunder if
such amendment, modification or discontinuance applies
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generally to Employer’s
salaried work force and does not single out Executive for disparate
treatment; or
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(v)
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acts or omissions of Employer
constituting a violation of any of its material obligations under
this Agreement.
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For purposes of
this definition, none of the actions described in clauses
(i) through (iv) above shall constitute a Good Reason if it
was an isolated and inadvertent action not taken in bad faith by
Employer and if it and any damage caused to Executive is remedied
by Employer promptly after receipt of notice thereof given by
Executive. For purposes of this definition, any action or failure
to act described in clauses (i) through (v) above shall
cease to be a Good Reason on the date which is 90 days after
the date on which such action or failure to act first occurred
unless, prior to such date, Executive delivers a Notice of
Termination to Employer pursuant to Section 6(f). In the event
of any dispute between Employer and Executive with respect to the
aggregate value or level of any of Executive’s benefits for
purposes of clause (iv) above, Employer and Executive shall
use their best efforts to resolve such dispute themselves. If they
are unable to resolve the dispute within 15 business days, an
Accounting Firm shall be engaged by Employer to make its own
determination with respect to the dispute and the determination by
such Accounting Firm shall be final and binding on Employer
(including the Compensation Committee) and Executive. If an
Accounting Firm is engaged with respect to any dispute as
aforesaid, (A) such Accounting Firm shall be instructed to
make its determination as soon as practicable (but in no event
later than 60 days after Executive delivers the Notice of
Termination) and to use such materiality standard as such
Accounting Firm may determine to be reasonable under the
circumstances and (B) Employer and Executive shall provide
such Accounting Firm with all books, records and other information
relevant to such dispute as such Accounting Firm may reasonably
request. No Accounting Firm engaged as aforesaid shall be liable or
responsible to Employer (including the Compensation Committee) or
Executive for any determination made by such Accounting Firm in
good faith.
“
Gross-Up Payment ” has the meaning specified in
Section 7(g).
“
ICP ” has the meaning specified in
Section 5(b).
“
Inability to Perform ” means (i) Executive
has been determined under Employer’s long-term disability
plan to be eligible for long-term disability benefits or
(ii) Executive has suffered a physical or mental condition
that, in the opinion of a licensed physician reasonably acceptable
to Employer and Executive (or his legal representative), prevents
Executive from being able to perform the essential functions of his
position for (A) a period of three consecutive months or
(B) an aggregate of four months within any period of
12-consecutive months.
“
Payment ” has the meaning specified in
Section 7(g).
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“
Protection Period ” means the period commencing
180 days prior to the date on which the relevant Change of
Control occurs and ending two years after the date on which such
Change of Control occurs.
“
Protection Period Severance Payment ” has the
meaning specified in Section 7(e).
“
Restricted Activities ” has the meaning
specified in Section 7(g).
“
Section 409A Exempt Amount ” has the
meaning specified in Section 7(f).
“
Severance Payment ” has the meaning specified
in Section 7(f).
“
Target Bonus ” has the meaning specified in
Section 5(b).
“
Vacation Payment ” has the meaning specified in
Section 7(a).
“ Work
Product ” means all ideas, works of authorship,
inventions and other creations, whether or not patentable,
copyrightable or subject to other intellectual-property protection,
that are made, conceived, developed or worked on in whole or in
part by Executive while employed by Employer and/or any of its
Affiliates, that relate in any manner whatsoever to the business,
existing or then-proposed, of Employer and/or any of its
Affiliates, or any other business or research or development effort
in which Employer and/or any of its Affiliates engages during the
Employment Term excluding, however, any such work product that is
or becomes generally usable by the public without payment of
compensation to the owner thereof unless such work product becomes
so usable as a result of any breach of this Agreement or other
unauthorized disclosure by Executive.
2.
Employment . Employer agrees to employ Executive, and
Executive agrees to be employed, during the Employment Term in the
position and with the duties and responsibilities set forth in
Section 4(a) and upon the other terms and conditions set out in
this Agreement. As soon as practicable after the Effective date,
Employer shall cause Executive to become a member of the Board and,
during the Employment Term, Employer shall cause Executive to be
nominated as a member of the Board at each annual meeting of the
stockholders of Employer.
3.
Term . Executive’s employment shall commence on the
Effective Date and shall be for an initial term of three years (the
“ Employment Term ”), unless sooner
terminated as provided in this Agreement. Subject to earlier
termination as provided in this Agreement, on the last day of each
Annual Period, the Employment Term shall be automatically extended
for an additional one-year period unless Employer gives written
notice to Executive at least three months prior to the last day of
such Annual Period of its election to not extend this Agreement for
an additional one-year period. Each automatic one-year extension
shall be part of the Employment Term.
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4.
Position and Duties . (a) During the Employment Term,
Executive shall be employed as President and Chief Executive
Officer of Employer, under the direction and subject to the control
of the Board (which direction shall be such as is customarily
exercised over a chief executive officer), and Executive shall be
responsible for the business, affairs, properties and operations of
Employer and shall have general executive charge, management and
control of Employer, with all such powers and authority with
respect to such business, affairs, properties and operations as may
be reasonably incident to such duties and responsibilities. In
addition, Executive shall have such other duties, functions,
responsibilities and authority as are from time to time delegated
to Executive by the Board; provided, however , that such
duties, functions, responsibilities and authority are reasonable
and customary for a person serving in the same or similar capacity
of an enterprise comparable to Employer.
(b) During
the Employment Term, Executive shall devote his full business time,
skill and attention and his best efforts to the business and
affairs of Employer to the extent necessary to discharge fully,
faithfully and efficiently the duties and responsibilities
delegated and assigned to Executive in or pursuant to this
Agreement, except for usual, ordinary and customary periods of
vacation and absence due to illness or other disability and as
otherwise specified in this Section. Employer agrees that it shall
not be a violation of this Agreement for Executive to
(i) serve on civic or charitable boards or committees,
(ii) deliver lectures or fulfill speaking engagements at
educational institutions or (iii) manage personal investments,
so long as in the case of (i), (ii) or (iii) above such
activities do not, individually or in the aggregate, significantly
interfere or conflict with the performance of Executive’s
responsibilities under this Agreement or the interests of Employer.
In addition, Employer acknowledges that Executive currently serves
on the Board of Directors of Encore Acquisition Company and
represents that such service shall not be considered a violation of
this Section unless such activities significantly interfere with
Executive’s performance of his responsibilities under this
Agreement. Executive shall not become a member of the board of
directors or committees of any other business organization (but
excluding charitable organizations even if conducting a business)
without the prior written consent of the Board.
(c) In
connection with Executive’s employment under this Agreement,
Executive shall be based in Houston, Texas, or at any other place
where the principal executive offices of Employer may be located
during the Employment Term. Executive also will engage in such
travel as the performance of Executive’s duties in the
business of Employer may require.
(d) All
services that Executive may render to Employer or any of its
Affiliates in any capacity during the Employment Term shall be
deemed to be services required by this Agreement and the
consideration for such services is that provided for in this
Agreement.
(e) Employer
agrees that it has provided to Executive and Executive hereby
acknowledges that he has read and is familiar with Employer’s
policies regarding business ethics and conduct, and will comply
with all such provisions, and any amendments thereto, during the
Employment Term.
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5.
Compensation and Related Matters . (a) Base Salary.
During the Employment Term, Employer shall pay Executive for his
services under this Agreement an annual base salary (“
Base Salary ”). The Base Salary on the
Effective Date through February 28, 2009 shall be $395,000 and
the Base Salary on March 1, 2009 shall be $415,000. The Base
Salary is subject to annual adjustments on March 1 of each year
beginning March 2010, at the discretion of the Board, but in
no event shall Employer pay Executive a Base Salary less than the
Base Salary then in effect without the consent of Executive. The
Base Salary shall be payable in bi-monthly installments (in
arrears) in accordance with the general payroll practices of
Employer, or as otherwise mutually agreed upon.
(b)
Annual Incentives . Beginning in calendar year 2008 and
during the Employment Term, Executive will participate in
Employer’s Bonus Plan or any other incentive compensation
plan (whether payable in cash or equity of Employer) applicable to
Executive’s position as may be adopted by Employer from time
to time (the Bonus Plan or such other plan, the “
ICP ”). Executive’s target award
opportunity under the ICP will be 100% of Executive’s Base
Salary (“ Target Bonus ”) with a
threshold of 50% of Executive’s Base Salary and a maximum of
200% of Executive’s Base Salary, and shall be subject to such
other terms, conditions and restrictions as may be established by
the Board or the Compensation Committee. Prior to March 1 of each
year, Executive will develop a proposed set of performance metrics
for that year that are subject to review and approval by the Board
and/or the Compensation Committee. Performance metrics for 2008
will be developed by Executive and submitted to the Board for its
review and approval within one month of the Effective
Date.
(c)
Equity Option Grant Related to Initial Employment .
Executive shall be granted, on the Effective Date and pursuant to
Employer’s Amended and Restated 2002 Stock Plan and
Employer’s standard form of option agreement, nonqualified
stock options to purchase 120,000 shares of Employer’s common
stock at an exercise price of $31.60, which option will have a
ten-year term and will vest and become exercisable in three equal,
annual installments with the first installment vesting and becoming
exercisable on the first anniversary of the Effective Date (subject
to Executive’s continued employment with the Company on each
applicable vesting date).
(d)
Long-Term Incentive Awards Related to Future Employment . In
addition to the stock options granted pursuant to
Section 5(c), Employer will annually determine whether
Executive should receive additional stock options, restricted stock
awards of Employer’s common stock or awards of performance
units payable in cash (or a combination thereof) based on
Executive’s performance relative to predetermined long-term
performance metrics. Prior to March 1 of each year, Executive will
develop a proposed set of long-term performance metrics for that
year that are subject to review and approval by the Board and/or
the Compensation Committee. Long-term performance metrics for 2008
will be developed by Executive and submitted to the Board for its
review and approval within one month of the Effective Date. The
exercise price for stock options granted pursuant to this Section
5(d) will be determined by the Board or the Compensation Committee
at the time of grant but will not, in any event, be less than the
fair market value of a share of Employer’s common stock as of
the date of grant.
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(e)
Employee Benefits . During the Employment Term, Executive
shall be entitled to participate in all Benefit Plans or other
employee benefit programs and arrangements that are generally made
available by Employer to its current Chief Executive Officer,
including without limitation Employer’s life insurance,
equity based plans, long-term disability and health plans.
Executive acknowledges that Employer has frozen its Salaried
Employees’ Pension Plan, Pension Benefit Equalization Plan
and Supplemental Employee Retirement Plan and Executive will not be
eligible to participate in, or receive any benefits under, such
plans. Executive acknowledges and agrees that cooperation and
participation in medical or physical examinations may be required
by one or more insurance companies in connection with the
applications for such life and/or disability insurance
policies.
(f)
Business Expenses . Executive shall be entitled to receive
reimbursement for all reasonable expenses incurred by Executive
during the Employment Term in performing his duties and
responsibilities under this Agreement, consistent with
Employer’s policies or practices for reimbursement of
expenses incurred by other senior executives of Employer (“
Business Expenses ”).
(g)
Vacations . Executive shall be eligible for four
weeks’ annual paid vacation during each of the first two
Annual Periods of the Employment Term, and then, five weeks annual
vacation during each successive Annual Period of the Employment
Term, as well as sick pay and other paid and unpaid time off in
accordance with the policies and practices of Employer. Executive
agrees to use his vacation and other paid time off at times that
are (i) consistent with the proper performance of his duties
and responsibilities and (ii) mutually convenient for Employer
and Executive.
(h)
Fringe Benefits . During the Employment Term, Executive
shall be entitled to the perquisites and other fringe benefits that
are made available by Employer to its senior executives generally,
subject to any applicable terms and conditions of any specific
perquisite or other fringe benefit; provided, however , that
the Board may award or provide employee Benefit Plans or programs
and arrangements to Executive which are different from (but not
less in value) than those which are provided to other senior
executives of Employer generally.
(i)
Relocation. Employer shall reimburse Executive for all
reasonable actual out-of-pocket costs and expenses incurred by
Executive in connection with relocating to the Houston, Texas area,
which shall be deemed to be (i) all customary and reasonable
realtor fees and closing costs associated with the sale of
Executive’s existing San Antonio home, (ii) all
customary and reasonable closing costs, inspection costs, survey
costs and other customary and reasonable fees and expenses
(excluding financing points) associated with the purchase by
Executive of a new home in the Houston, Texas area and
(iii) all costs associated with moving Executive’s and
his immediate family’s personal belongings from San Antonio,
Texas to the Houston, Texas area to the extent such costs do not
exceed $150,000; provided, however , that in each case such
costs and expenses are incurred by Executive within three years
from the Effective Date. Employer will reimburse Executive for
temporary housing and other related costs in the Houston, Texas
area for up to 120 days from the Effective Date in an amount
not to exceed $5,000 per month. The reimbursements for expenses for
which Executive is entitled to
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be reimbursed
pursuant to this Section 5(i) shall be made on or before the last
day of the calendar year following the calendar year in which the
applicable expense is incurred. Executive acknowledges and agrees
that some of the costs and expenses reimbursed by Employer pursuant
to this Section 5(i) will be taxable as imputed income. In the
event that Executive terminates his employment with Employer
without Good Reason during the two-year period following the
Effective Date, Executive shall refund to Employer all amounts paid
by Employer pursuant to this Section 5(i) within 30 days after
demand therefore by Employer.
(j)
Directors and Officers (D&O) Liability Insurance.
Employer will provide information on their D&O insurance
coverage and will cause Executive to be covered thereunder as of
the Effective Date and following the Employment Termination Date
(for any reason) for the period during which any action which would
otherwise be covered by the D&O insurance could be brought
against Employer, its Affiliates or Executive.
(k)
Transaction Fees . In connection with the consummation of
any Transaction (as defined below) that is consummated during the
term of this Agreement, Executive shall (i) be paid a
transaction fee (each, a “ Transaction Fee
”) in an amount equal to 0.66% of the Value (as defined
below) of such Transaction and (ii) have the authority to
allocate a bonus pool of 0.59% of the Value of such Transaction
among Employer’s other employees, including Employer’s
other senior executive officers, based upon each individual’s
contribution towards the consummation of such Transaction. For
purposes of this Agreement:
“
Transaction ” means any non-ordinary course
transaction designated as a “Transaction” by the Board
or the Compensation Committee that enhances stockholder value and
meets such other criteria as may be specified by the Board or the
Compensation Committee at the time of such designation (
e.g. , an acquisition, a divestiture, a merger or
consolidation, the formation of a joint venture or partnership or a
similar transaction); provided, however , that any
designation of a transaction as a “Transaction” by the
Board or the Compensation Committee, once made, shall be
irrevocable as to that transaction.
“
Value ” means, with respect to any Transaction,
(A) the aggregate amount of cash and the fair market value
(determined as set forth below) of any securities or other property
paid or transferred, directly or indirectly, by or to Employer or
any of the holders of Employer’s equity securities (in their
capacity as equity security holders), in connection with such
Transaction, or received by Employer in the case of a contribution
of all or any portion of Employer’s assets to a joint venture
or strategic partnership), plus (B) all indebtedness
for borrowed money (net of cash on Employer’s balance sheet)
directly or indirectly assumed, refinanced, retired or extinguished
in connection with such Transaction (and all payments made in
connection therewith, including, without limitation, prepayment
premiums), with ( x ) the value of any securities (whether
debt or equity) that are freely tradable in an established public
market being valued at the average of their 4:00 p.m. closing
prices (as reported in The Wall Street Journal) for the five
trading days prior to the public announcement of such Transaction,
( y ) the value any of any other non-cash consideration
being the greater of (1) the fair market value thereof (as
determined in good faith by Employer and Executive or, in the
absence of agreement, as determined by an
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independent
appraisal) and (2) the value (if any) attributed to such
non-cash consideration in such Transaction by the parties to such
Transaction and ( z ) the value of contingent consideration
to be paid in the future
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