Exhibit 10.12(j)
EXECUTION VERSION
EMPLOYMENT AGREEMENT
December 19, 2006
This
Agreement (“Agreement”), effective as of
December 19, 2006 (the “Effective Date”), by and
between DAVID A. LUPTAK, currently residing at 14 Blackburn Road,
Sewickley, PA 15143, and WHEELING-PITTSBURGH CORPORATION, a
corporation organized under the laws of the State of Delaware (the
“Company”).
In
consideration of the covenants and conditions herein contained and
other good and valuable consideration, receipt of which is hereby
acknowledged by each party, the parties hereby agree as
follows:
1.
EMPLOYMENT.
The
Company shall employ the Executive commencing on the Effective
Date, and the Executive hereby accepts such employment, all upon
the terms and conditions set forth herein.
2.
DUTIES AND AUTHORITY.
Executive shall serve as the Executive Vice President, General
Counsel and Secretary for both the Company and Wheeling-Pittsburgh
Steel Corporation (“WPSC”), with those authorities,
duties and responsibilities customary to that position and such
other authorities, duties and responsibilities as the Board of
Directors of the Company (the “Board”) may reasonably
assign the Executive from time to time. The Executive shall use his
best efforts, including the highest standards of professional
competence and integrity, and shall devote substantially all of his
business time and effort, in and to his employment hereunder, and
shall not engage in any other business activity which would
conflict with the rendition of his services hereunder, except that
the Executive may hold directorships or related positions in
charitable, educational or not-for-profit organizations, or
directorships in business organizations if approved by the Board,
and make passive investments, which do not unreasonably interfere
with the Executive’s day-to-day acquittal of his
responsibilities to the Company.
3.
TERM.
(a) GENERAL . This
Agreement shall have effect as of the Effective Date, and shall
remain in effect until November 30, 2007 subject to earlier
termination under Section 3(b) or Section 5 or extension as
described below. The period from the Effective Date until this
Agreement shall have expired in accordance with this Section or
been terminated in accordance with Section 5 is hereafter
referred to as “the term hereof” or “the term of
this Agreement.” The term hereof shall be extended
automatically for an additional year as of December 1, 2007
and as of each subsequent annual anniversary of such date (each
such extension date is referred to herein as a “Renewal
Date”) unless at least one hundred twenty (120) days
prior to any such Renewal Date either party shall have given notice
to the other party that the term of this Agreement shall not be so
extended.
(b) EFFECT OF POSSIBLE
MERGERS . The Company has entered into a Merger Agreement dated
October 24, 2006 with Companhia Siderurgica Nacional (CSN). In
addition, a merger with Esmark Incorporated has been proposed.
Notwithstanding the foregoing, if either
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EXECUTION VERSION
of these
proposed mergers is consummated, the Agreement will terminate
30 days after completion of the merger.
(c) SURVIVAL OF CERTAIN
PROVISIONS . Notwithstanding anything else herein contained,
the provisions of Sections 4 through 7 hereof shall survive
the termination of this Agreement and of the Executive’s
employment hereunder.
4.
COMPENSATION.
In
return for his services hereunder, the Executive shall be entitled
to (i) the Salary as specified below, (ii) bonuses, to
the extent provided below, (iii) long-term incentive, and (iv)
certain fringe benefits, to the extent provided below.
(a) SALARY . Starting
with the Effective Date, the Company shall pay the Executive, in
accordance with the Company’s customary payroll practices for
executives, salary at an annual rate of $300,000, subject to annual
review and upward adjustment at the determination of the
Compensation Committee of the Board (as so adjusted, the
Executive’s “Salary”).
(b) BONUS . For the
period from the Effective Date until December 31, 2007, the
Executive will not be eligible to receive a bonus. In subsequent
years, at the discretion of the Compensation Committee, the
Executive may participate in the Company’s existing
short-term incentive plan for executives, as the same may be
amended from time to time by the Board. The Board may also award
other bonuses from time to time in its discretion.
(c) LONG-TERM INCENTIVES
. Within 30 days of the Effective Date, the Company shall make
an initial equity grant to the Executive as stated below. In all
subsequent years, the Executive shall be awarded such equity
incentive awards as the Board or the Compensation Committee shall
determine from time to time in their discretion. The terms of the
initial equity grant shall be as stated below with additional terms
consistent with Company practices:
Number of restricted shares:
23,000
Vesting schedule for restricted
shares: Vest 1/3 on each of the first three anniversaries of the
Effective Date.
Executive may be eligible to
participate in other long-term incentive plans and programs as the
Board or the Compensation Committee may deem appropriate from time
to time.
(d) FRINGE BENEFITS .
The Executive will be eligible for and entitled to participate in
other benefits maintained by the Company for its senior executive
officers, as such benefits may be modified from time to time for
all such employees, such as its medical, dental, 401(k), accident,
disability, and life insurance benefits, on a basis not less
favorable than that applicable to other executives of the Company.
Any such participation shall be subject to (i) the terms of
the applicable plan documents, (ii) generally applicable
policies of the Company and (iii) the discretion of the Board
or any administrative or other committee provided for in or
contemplated by such plan, exercised in accordance with applicable
law. The Executive will also be entitled to the following:
(i) Subject
to the Company’s standard policies, four (4) weeks of
vacation per calendar year (or any longer period as shall be
provided under the Company’s general vacation policies),
without reduction in Salary, to be taken at such times and
intervals as shall
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EXECUTION VERSION
be
determined by the Executive subject to the reasonable business
needs of the Company and to Company policies as in effect from
time.
(ii) Appropriate
office space, administrative support, e.g., secretarial assistance,
and such other facilities and services as are suitable to the
Executive’s position and adequate for the performance of the
Executive’s duties.
(iii) Payment
or reimbursement of the cost, not covered by health insurance, of
one comprehensive physical examination during each year during the
term of this Agreement.
Executive acknowledges that he will have no right to cash
compensation in lieu of any of the specific foregoing fringe
benefits except with respect to vacation pay, and then only to the
extent, if any, allowed by the Company’s vacation pay
policies as in effect from time to time.
(e) EXPENSES . The
Executive will be entitled to reimbursement of all reasonable
expenses, in accordance with the Company’s policy as in
effect from time to time and on a basis not less favorable than
that applicable to other executives of the Company, including,
without limitation, telephone, travel and entertainment expenses
incurred by the Executive in connection with the business of the
Company, subject to such reasonable substantiation and
documentation as may be specified by the Company.
(f) INDEMNIFICATION .
The Company shall, and the Company shall use its best efforts to
cause any subsidiaries or affiliates it may now or hereafter have
to, indemnify the Executive to the maximum extent permitted by law
and regulation in connection with any liability, expense or damage
which the Executive incurs as a result of the Executive’s
employment and positions with the Company and its current or future
subsidiaries as contemplated by this Agreement, provided that the
Executive shall not be indemnified with respect to any matter as to
which he shall have been adjudicated in any proceeding not to have
acted in good faith in the reasonable belief that his action was in
the best interest of the Company and its subsidiaries. The Company,
on behalf of itself and its current and future subsidiaries, hereby
confirms that the occupancy of all offices and positions which in
the future are or were occupied or held by the Executive in
connection with his employment under this Agreement have been so
occupied or held at the request of and for the benefit of the
Company and its subsidiaries for purposes of the Executive’s
entitlement to indemnification under applicable provisions of the
respective articles of organization and/or other similar documents
of the Company and its subsidiaries.
Expenses
incurred by the Executive in defending a claim, action, suit,
investigation or proceeding shall be paid by the Company in advance
of the final disposition thereof upon the receipt by the Company of
an undertaking by the Executive to repay such amount if it shall
ultimately be determined that he is not entitled to be indemnified
hereunder. The foregoing rights are not exclusive and shall not
limit any rights accruing to the Executive under any other
agreement or contract or under applicable law.
(g) PARACHUTE PAYMENT
TAXES . Notwithstanding any other provisions of this Agreement,
in the event that any payment or benefit under this Agreement or
any other agreement or arrangement of the Company received or to be
received by the Executive in connection with a Change in Control or
the termination of the Executive’s employment (all such
payments and benefits, the “Total Payments”) is
determined to be subject (in whole or part) to the excise tax
imposed by Section 4999 of the Code (together with any
interest or penalties
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EXECUTION VERSION
imposed
with respect to such excise tax, the “Excise Tax”),
then the Executive shall be entitled to receive an additional
payment (a “Gross-Up Payment”) in an amount such that
after payment by the Executive of all taxes (including any interest
or penalties imposed with respect to such taxes), including without
limitation any income taxes and Excise Tax imposed upon the
Gross-Up Payment, the Executive retains an amount equal to the
Excise Tax (and, for the avoidance of doubt, the amount of the
Total Payments). All determinations required to be made under this
Section 4(g), including whether and when a Gross-Up Payment is
required and the amount of such Gross-Up Payment and the
assumptions to be utilized in arriving at such determination, shall
be made by the Company’s accountants or such other certified
public accounting firm reasonably acceptable to the Company as may
be designated by the Executive which shall provide detailed
supporting calculations both to the Company and the
Executive.
5.
TERMINATION OF EMPLOYMENT AND EFFECTS THEREOF.
(a) TERMINATION . This
Agreement and the Executive’s employment under this Agreement
may be terminated only in the following circumstances. On any
termination in accordance with this Section, the Executive (or in
the event of his death, his estate) shall be entitled to his then
Salary earned but unpaid through the end of the month in which
termination (including death) occurred. The Company shall have only
such further obligations to the Executive (or in the event of his
death, his estate), if any, as are specified below under the
applicable termination provision.
(i)
UPON DEATH . In the event of the Executive’s death
during the term hereof, the Executive’s employment hereunder
shall immediately and automatically terminate.
(ii)
AS A RESULT OF DISABILITY . In the event that the Executive
becomes disabled during the term hereof within the meaning of the
Company’s then applicable long-term disability plan, the
Company may terminate the Executive’s employment without
further obligation upon notice to the Executive. In the event of
such disability, the Executive will continue to receive his base
salary and benefits under Section 4 hereof until the earlier
of his death or the date the Executive becomes eligible for
disability income under the Company’s then applicable
long-term disability plan or workers’ compensation insurance
plan.
(iii)
BY THE COMPANY FOR CAUSE . The Company may terminate the
Executive’s employment for Cause (as defined in subsection
(b) below) at any time upon notice to the Executive setting
forth in reasonable detail the nature of such Cause.
(iv)
BY THE COMPANY OTHER THAN FOR CAUSE . The Company may
terminate Executive’s employment other than for Cause upon
thirty (30) days notice to the Executive (or at its option
immediately with thirty (30) days continued compensation,
including then Salary and benefits, in lieu of such notice). In the
event of such termination, Executive (or in the event of his death
following termination, his estate) shall be entitled only to the
additional amounts described in subparagraph (A) below and the
continuation of health insurance benefits described in subparagraph
(B) below:
(A)
Salary and Pro Rata Bonus Payment . If the Executive’s
employment is terminated by the Company without Cause, the
Executive shall be entitled to a payment equal to (x) one
(1) times his annual Salary at the highest annualized rate in
effect during the one year immediately preceding the date of the
date of termination, payable in a single lump sum within thirty
(30) days of termination, plus (y) a pro rata bonus, in
an amount determined under the
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EXECUTION VERSION
terms of
the applicable Company bonus plan, (but not less than 100% of the
Executive’s annual Salary for the first year of this
Agreement), payable at the same time as executive bonuses are paid
generally under the applicable Company bonus plan, but in no event
later than March 15 of the year following the year in which
the termination occurs.
(B)
Health Care Continuation . If at his termination of
employment by the Company without Cause the Executive is eligible
to and timely elects continued health coverage under
Sections 601-607 of ERISA (“COBRA Continuation”)
then, for the period of such COBRA Continuation, the Company shall
also pay that share of the premium cost of Executive’s COBRA
Continuation (and that of his eligible dependents also electing
COBRA Continuation) in the Company’s group health plan as it
pays for active employees of the Company and their dependents
generally.
(C)
Effect of Change of Control . In the event the Company
terminates the Executive’s employment other than for Cause
within one (1) year following a Change of Control (as defined
in subparagraph (b) below), the Executive shall be entitled to
receive an amount equal to the greater of (i) or (ii):
(i) Two
(2) times his annual Salary at the highest annualized rate in
effect during the one year immediately preceding the date of the
Change of Control, payable in a single lump sum within thirty
(30) days of termination, in lieu of the amount described in
subparagraph (A) above, COBRA Continuation under subparagraph
(B) above (but in this event, for a maximum of eighteen (18)
months), two (2) times his target bonus (which shall be 100%
of the Executive’s annual Salary if the Change of Control
occurs during the first year of this Agreement), and all equity
incentive awards will be fully vested (including the award pursuant
to Section 4(c)); or
(ii)The
amount payable under the following schedule.
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|
|
|
|
Change of Control Date |
|
Amount Payable |
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Within one
(1) year of Effective Date
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|
$ |
4,000,000 |
|
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After one
(1) year but less than two (2) years of Effective
Date
|
|
$ |
2,000,000 |
|
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After two
(2) years but less than three (3) years of Effective
Date
|
|
$ |
1,000,000 |
|
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After three
(3) years of Effective Date
|
|
$ |
0 |
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For
purposes of comparing the amounts payable under (i) and (ii),
the value of the vesting of equity awards in (i) shall be the
fair market value of any restricted stock that is vested and the
difference between the current fair market value of the
Company’s stock and the exercise price of any option that is
vested.
Anything
in this Agreement to the contrary notwithstanding, if the
Executive’s employment with the Company is terminated other
than for Cause prior to the date on which a Change of Control
occurs, and it is reasonably demonstrated that such termination
(i) was at the request of a third party who has taken steps
reasonably calculated to effect a Change in Control or
(ii) otherwise arose in connection with or anticipation of a
Change in Control then for all purposes of this Agreement the date
of the Change in Control shall mean the date immediately prior to
the date of such termination.
(v)
BY THE EXECUTIVE . Executive may terminate his employment
and this Agreement for any or no reason whatsoever at any time.
Except as provided in subparagraph
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EXECUTION VERSION
(B), the
Executive shall give at least sixty (60) days’ advance
notice of any such termination.
(A)
Good Reason . In the event the Executive gives such notice
for and within sixty (60) days of having Good Reason, on the
effective date of his resignation he shall be entitled to receive
an amount equal to one (1) times his annual Salary at the
highest annualized rate in effect during the one year immediately
preceding the date of the date of termination, payable in a single
lump sum within thirty (30) days of termination, COBRA
Continuation under subparagraph (B) of paragraph
(iv) above and a pro rata bonus under subparagraph (A) of
paragraph (iv) above.
(B)
Effect of Change of Control . In the event that at any time
within one (1) year following a Change of Control the
Executive gives notice to terminate employment for Good Reason
(with such notice given within sixty (60) days of having Good
Reason), he shall receive the greater of the benefits provided
under Section 5(a)(iv)(C) (i) or (ii) above.
Anything in this Agreement to the contrary notwithstanding, if the
circumstances constituting Good Reason occur prior to the date on
which a Change of Control occurs, and it is reasonably demonstrated
that such circumstances (i) occurred at the request of a third
party who has taken steps reasonably calculated to effect a Change
in Control or (ii) otherwise arose in connection with or
anticipation of a Change in Control then for all purposes of this
Agreement the date of the Change in Control shall mean the date
immediately prior to the occurrence of such circumstances.
(C)
Resignation without Good Reason . In the event the Executive
resigns other than in the circumstances described in subparagraphs
(A) and (B) above, he shall not be entitled to any
additional Salary or COBRA Continuation or pro rata bonus. The
Company may at its sole option waive the requirement of advance
notice and decline to accept the Executive’s service for any
period following its receipt of notice, but in that event,
Executive shall be entitled to continued compensation in accordance
with Section 4 for the entirety of the otherwise applicable
notice period (and will be deemed to be an employee for such
period) as well as Salary and COBRA Continuation and pro rata bonus
in accordance with this paragraph if applicable.
(vi)
EXPIRATION . In the event that the Company or the Executive
gives a Termination Notice under Section 3(a), then upon the
expiration of the term of this Agreement, if the Executive is then
employed, the Executive shall be entitled to receive an amount
equal to (x) one (1) times his annual Salary at the
highest annualized rate in effect during the one year immediately
preceding the date of termination, plus (y) a pro rata bonus
under subparagraph (A) of paragraph (iv) above, payable
in a single lump sum within thirty (30) days of the expiration
of the term of this Agreement, and COBRA Continuation under
subparagraph (B) of paragraph (iv) above. The Salary
benefit provided by this paragraph (vi) shall be reduced (but
not below zero) by the amount of any other cash severance benefit
to which the Executive may then be entitled under any general
severance plan or policy of the Company.
(b) DEFINITIONS . For
these purposes:
(i)
“Cause” means the Executive has: (A) been
convicted of, or has pled guilty or nolo contendere to any felony,
or any misdemeanor involving moral turpitude under the laws of the
United States or any state or political subdivisions thereof;
(B) committed a breach of
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EXECUTION VERSION
duty of
loyalty which is materially detrimental to the Company;
(C) materially violated any provision of Section 6 of
this Agreement; (D) failed to perform or adhere to explicitly
stated duti
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