Exhibit 10.21(a)
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the "Agreement") is made
and entered into as of the 24th day of October, 1997, by and between ▇▇▇▇▇'▇
General Stores, Inc., an Iowa corporation (the "Company"), and ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇▇").
WHEREAS, the Board of Directors of the Company (the "Board of
Directors") recognizes that the dedication of ▇▇▇▇▇▇▇▇ as an officer and
director to the affairs and welfare of the Company since its organization has
resulted in a long and successful association; and
WHEREAS, the Board of Directors further recognizes that the Company has
grown and prospered as a result of its association with ▇▇▇▇▇▇▇▇, and has
determined that it is in the best interests of the Company and its shareholders
to preserve this association so as to enable the Company to further benefit from
▇▇▇▇▇▇▇▇'▇ superior knowledge and expertise in all of its present and future
business endeavors; and
WHEREAS, the Company and ▇▇▇▇▇▇▇▇ are parties to an Employment
Agreement dated as of March 2, 1992, as amended by a First Amendment to
Employment Agreement dated as of January 16, 1997 (together, the "Original
Agreement"), providing for the employment of ▇▇▇▇▇▇▇▇ to serve as the Chief
Executive Officer of the Company under the terms and conditions set forth
therein; and
WHEREAS, the Board of Directors has further determined that it is
appropriate and in the best interests of the Company and its shareholders to
modify the existing contractual arrangements with respect to ▇▇▇▇▇▇▇▇'▇
employment by the Company, with the concurrence of ▇▇▇▇▇▇▇▇, and to amend and
restate the Original Agreement to reflect the same; and
WHEREAS, the Board of Directors has further determined that it is in
the best interest of the Company and its shareholders to assure that the Company
will have the continued dedication of ▇▇▇▇▇▇▇▇, notwithstanding the possibility,
threat or occurrence of a Change of Control (as defined below) of the Company,
and to further encourage ▇▇▇▇▇▇▇▇'▇ full attention and dedication to the Company
currently and in the event of any threatened or pending Change of Control, and
to provide ▇▇▇▇▇▇▇▇ with compensation arrangements upon a Change of Control
which provide him with compensation for expected losses that he would suffer in
the event of a Change of Control and which are
competitive with those of other corporations, and, in order to accomplish these
objectives, has determined to cause the Company to enter into this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth in this Agreement, the parties hereto agree as follows:
1. CERTAIN DEFINITIONS. For purposes of this Agreement, and in
addition to the other definitions set forth herein, the following terms shall
have the following meanings:
a) "Change of Control" shall mean:
(i) the acquisition (other than from the Company) by any
Person (as hereinafter defined), entity or "group" within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934 (the "Exchange
Act"), (excluding for this purpose, the Company or any employee benefit plan of
the Company, which acquires beneficial ownership of voting securities of the
Company) of beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of twenty percent (20%) or more of either the then
outstanding shares of Common Stock, no par value, of the Company or the combined
voting power of the Company's then outstanding voting securities entitled to
vote generally in the election of directors (hereinafter referred to as the
"Common Stock"), unless such beneficial ownership was acquired as a result of an
acquisition of shares of Common Stock by the Company which, by reducing the
number of shares outstanding, increases the proportionate number of shares
beneficially owned by such Person, entity or "group" to twenty percent (20%) or
more of the Common Stock of the Company then outstanding; provided, however,
that if a Person, entity or "group" shall become the beneficial owner of twenty
percent (20%) or more of the Common Stock of the Company then outstanding by
reason of share purchases by the Company and shall, after such share purchases
by the Company, become the beneficial owner of any additional shares of Common
Stock of the Company, then such Person, entity or "group" shall be deemed to
have met the conditions hereof; or
(ii) individuals who, as of the date hereof, constitute the
Board of Directors (as of the date hereof, the "Incumbent Board") cease for any
reason to constitute at least a majority of the Board of Directors, provided
that any person becoming a director subsequent to the date hereof whose
election, or nomination for election by the Company's shareholders, was approved
by a vote of at least a majority of the directors then comprising the Incumbent
Board (other than an election or nomination of an individual whose initial
assumption of office is in connection with an actual or threatened election
contest relating to the election of the directors of the Company, as such terms
are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act)
shall be, for purposes of this Agreement considered as though such person were a
member of the
Incumbent Board; or
(iii) approval by the shareholders of the Company of a
reorganization, merger, consolidation (in each case, with respect to which
persons who were the shareholders of the Company immediately prior to such
reorganization, merger or consolidation do not, immediately thereafter, own more
than fifty percent (50%) of the combined voting power entitled to vote generally
in the election of directors of the reorganized, merged or consolidated
company's then outstanding voting securities) or a liquidation or dissolution of
the Company or of the sale of all or substantially all of the assets of the
Company.
(b) "Annual Increase" shall take effect on each January 1 for which the
benefit at issue is payable and shall mean fifty percent (50%) of the annual
increase in the National Consumer Price Index for the City of Des Moines, Iowa,
as published by the United States Bureau of Labor Statistics.
(c) "Annual Bonus" shall mean any bonus payable at the discretion of
the Board of Directors of the Company, on such terms and in such amounts as it
shall determine.
(d) "Employment Period" shall mean the term of ▇▇▇▇▇▇▇▇'▇ employment
under this Agreement, as set forth in Section 2 hereof.
(e) "Code" shall mean the Internal Revenue Code of 1986, as
amended.
(f) "Accrued Obligations" shall mean (i) ▇▇▇▇▇▇▇▇'▇ Salary through the
Date of Termination at the rate in effect on the Date of Termination, (ii) the
product of the Annual Bonus paid to ▇▇▇▇▇▇▇▇ for the last full fiscal year and a
fraction, the numerator of which is the number of days in the current fiscal
year through the Date of Termination, and the denominator of which is 365 and
(iii) any compensation previously deferred (together with any accrued interest
thereon) and not yet paid by the Company and any accrued vacation pay not yet
paid by the Company.
(g) "Person" shall mean any individual, firm, corporation or other
entity, and shall include any successor (by merger or otherwise) and all
"affiliates" and "associates" of such entity (as those terms are defined in Rule
12b-2 of the General Rules and Regulations under the Exchange Act).
2. EMPLOYMENT AND TERM. The Company agrees to employ ▇▇▇▇▇▇▇▇, and ▇▇▇▇▇▇▇▇
agrees to serve the Company, as Chief Executive Officer of the Company on the
terms and under the conditions set forth in this Agreement. The initial term of
employment under this Agreement shall commence on the date hereof and shall
terminate
on April 30, 1998 (the "Initial Term"), after which this Agreement and the
Employment Period hereunder shall be automatically renewed and extended for
successive periods of three years (each of which shall be a "Renewal Term"),
subject to the right of the Company and ▇▇▇▇▇▇▇▇ to terminate this Agreement
during the Initial Term or any such Renewal Term in accordance with the terms
and conditions set forth in subsequent sections of this Agreement, and further
subject to the right of the Company and ▇▇▇▇▇▇▇▇ to cause this Agreement and the
Employment Period hereunder to expire at the end of the Initial Term or any
Renewal Term by giving written notice thereof at least one year prior to the end
of the Initial Term or the then current Renewal Term, as applicable; provided,
however, that in the event of a Change of Control during the Initial Term or any
Renewal Term, this Agreement and the Employment Period hereunder automatically
shall continue in full force and effect for the greater of (i) the remaining
term of employment then in progress or (ii) three years from the effective date
of the Change of Control. References herein to the Employment Period shall refer
to both the Initial Term and any successive Renewal Term.
3. DUTIES OF ▇▇▇▇▇▇▇▇. During the period of his employment in the
capacity of Chief Executive Officer, ▇▇▇▇▇▇▇▇ will perform his duties to the
best of his ability, subject to the control of the Board of Directors. It is
agreed and understood that the position (including status, office, title and
reporting requirements), authority, duties and responsibilities of ▇▇▇▇▇▇▇▇
shall be substantially the same as those performed by ▇▇▇▇▇▇▇▇ as Chief
Executive Officer of the Company prior to the date of this Agreement, and that
▇▇▇▇▇▇▇▇ shall at all times serve the best interests of the Company. The Company
agrees that ▇▇▇▇▇▇▇▇ shall at all times have such authority and discretion as is
required in the carrying out of ▇▇▇▇▇▇▇▇'▇ duties in a proper and efficient
manner, subject to review by the Board of Directors.
During the period of his employment, it shall not be a violation of
this Agreement for ▇▇▇▇▇▇▇▇ to (i) serve on corporate, civil or charitable
boards or committees, (ii) deliver lectures or fulfill speaking engagements and
(iii) manage personal investments, so long as such activities do not
significantly interfere with the performance of ▇▇▇▇▇▇▇▇'▇ responsibilities as
an employee of the Company in accordance with this Agreement. It is expressly
understood and agreed that to the extent that any such activities have been
conducted by ▇▇▇▇▇▇▇▇ prior to the date hereof, the continued conduct of such
activities (or the conduct of activities similar in nature and scope thereto)
subsequent to the date hereof shall not thereafter be deemed to interfere with
the performance of ▇▇▇▇▇▇▇▇'▇ responsibilities to the Company.
4. COMPENSATION. The Company shall pay to ▇▇▇▇▇▇▇▇ an annual salary of
Three Hundred and Fifty Thousand Dollars ($350,000), payable in equal monthly
installments, or such other amount as shall be mutually agreed upon by the
Company and ▇▇▇▇▇▇▇▇ (the "Salary"). In addition, ▇▇▇▇▇▇▇▇ and/or ▇▇▇▇▇▇▇▇'▇
family shall be entitled
to receive all benefits presently provided or those which may hereafter be
generally provided by the Company to its employees, officers or directors,
including health insurance and life insurance. With respect to such health
insurance benefits, the Company agrees that at all times the health insurance
coverages available to ▇▇▇▇▇▇▇▇ and his spouse under such plans shall include
provisions providing for lifetime benefits payable on behalf of ▇▇▇▇▇▇▇▇ and his
spouse of not less than One Million Dollars ($1,000,000) each, or such other
amount as the Company and ▇▇▇▇▇▇▇▇ may specifically agree upon in writing,
subject, however, to any limitations, restrictions or conditions that shall from
time to time be necessary to satisfy the requirements of applicable federal or
state laws and regulations.
5. TERMINATION OF EMPLOYMENT. (a) Death or Disability. ▇▇▇▇▇▇▇▇'▇
employment under this Agreement shall terminate automatically upon ▇▇▇▇▇▇▇▇'▇
death. If the Company determines in good faith that the Disability of ▇▇▇▇▇▇▇▇
has occurred (pursuant to the definition of "Disability" set forth below), it
may give to ▇▇▇▇▇▇▇▇ written notice of its intention to terminate ▇▇▇▇▇▇▇▇'▇
employment as Chief Executive Officer of the Company. In such event, ▇▇▇▇▇▇▇▇'▇
employment with the Company shall terminate effective on the thirtieth (30th)
day after receipt of such notice by ▇▇▇▇▇▇▇▇ (the "Disability Effective Date"),
provided that, within the thirty (30) days after such receipt, ▇▇▇▇▇▇▇▇ shall
not have returned to full-time performance of his duties. For purposes of this
Agreement, "Disability" means disability or incapacity of ▇▇▇▇▇▇▇▇ which, at
least twenty-six (26) weeks after its commencement, is determined by the Board
of Directors upon competent medical advice to be such as to prevent ▇▇▇▇▇▇▇▇
from performing substantially all of the duties of Chief Executive Officer of
the Company.
(b) Cause. The Company may terminate ▇▇▇▇▇▇▇▇'▇ employment for "Cause."
For purposes of this Agreement, "Cause" means (i) an act or acts of personal
dishonesty taken by ▇▇▇▇▇▇▇▇ and intended to result in substantial personal
enrichment of ▇▇▇▇▇▇▇▇ at the expense of the Company, (ii) repeated violations
by ▇▇▇▇▇▇▇▇ of ▇▇▇▇▇▇▇▇'▇ obligations under Section 3 of this Agreement which
are demonstrably willful and deliberate on ▇▇▇▇▇▇▇▇'▇ part and which are not
remedied in a reasonable period of time after receipt of written notice from the
Company or (iii) the conviction of ▇▇▇▇▇▇▇▇ of a felony when such conviction is
no longer subject to direct appeal.
(c) Good Reason. ▇▇▇▇▇▇▇▇'▇ employment may be terminated by ▇▇▇▇▇▇▇▇ for
Good Reason. For purposes of this Agreement, "Good Reason" means:
(i) the assignment to ▇▇▇▇▇▇▇▇ of any duties inconsistent in
any respect with ▇▇▇▇▇▇▇▇'▇ position (including status, office, titles and
reporting requirements), authority, duties or responsibilities as contemplated
by Section 3 of this Agreement, or any other action by the Company which results
in a diminution in such position, authority, duties or responsibilities,
excluding for this purpose an isolated, insubstantial and
inadvertent action not taken in bad faith and which is remedied by the Company
promptly after receipt of notice thereof given by ▇▇▇▇▇▇▇▇;
(ii) Any failure by the Company to comply with the provisions
of Section 4 of this Agreement, other than an isolated, insubstantial and
inadvertent failure not occurring in bad faith and which is remedied by the
Company promptly after receipt of notice thereof given by ▇▇▇▇▇▇▇▇;
(iii) the Company's requiring ▇▇▇▇▇▇▇▇ to be based at any
office or location other than the Company's Corporate Headquarters facility in
Ankeny, Iowa, except for travel reasonably required in the performance of
▇▇▇▇▇▇▇▇'▇ responsibilities;
(iv) any purported termination by the Company of
▇▇▇▇▇▇▇▇'▇ employment otherwise than for death, Disability or Cause as
expressly permitted by this Agreement; or
(v) any failure by the Company to comply with and satisfy
Section 13(c) of this Agreement.
For purposes of this Section 5(c), any good faith determination of
"Good Reason" made by ▇▇▇▇▇▇▇▇ shall be conclusive.
(d) NOTICE OF TERMINATION. Any termination by the Company for Cause or
by ▇▇▇▇▇▇▇▇ for Good Reason shall be communicated by Notice of Termination to
the other party hereto given in accordance with Section 14(b) of this Agreement.
For purposes of this Agreement, a "Notice of Termination" means a written notice
which (i) indicates the specific termination provision in this Agreement relied
upon, (ii) sets forth in reasonable detail the facts and circumstances claimed
to provide a basis for termination of ▇▇▇▇▇▇▇▇'▇ employment under the provision
so indicated and (iii) if the Date of Termination (as defined below) is other
than the date of receipt of such notice, specifies the termination date (which
date shall be not more than fifteen (15) days after the giving of such notice).
The failure of ▇▇▇▇▇▇▇▇ to set forth in the Notice of Termination any fact or
circumstance which contributes to a showing of Good Reason shall not waive any
right of ▇▇▇▇▇▇▇▇ hereunder or preclude ▇▇▇▇▇▇▇▇ from asserting such fact or
circumstance in enforcing his rights hereunder.
(e) DATE OF TERMINATION. "Date of Termination" means the date of
receipt of the Notice of Termination or any later date specified therein, as the
case may be; provided, however, that (i) if ▇▇▇▇▇▇▇▇'▇ employment is terminated
by the Company other than for Cause or Disability, the Date of Termination shall
be the date on which the Company notifies ▇▇▇▇▇▇▇▇ of such termination and (ii)
if ▇▇▇▇▇▇▇▇'▇ employment is terminated by reason of death or Disability, the
Date of Termination shall be the date of
death of ▇▇▇▇▇▇▇▇ or the Disability Effective Date, as the case may be.
6. OBLIGATIONS OF THE COMPANY UPON TERMINATION OF
EMPLOYMENT.
(a) Death of ▇▇▇▇▇▇▇▇. In the event of the death of ▇▇▇▇▇▇▇▇ during the
term hereof, the Company shall pay to ▇▇▇▇▇▇▇▇'▇ spouse, commencing on the first
day of the month following his death and continuing for a period of twenty-four
(24) months thereafter, benefits equal to the monthly installments of Salary
which was then being paid to ▇▇▇▇▇▇▇▇ pursuant to Section 4 herein. Immediately
following such two-year period, the Company shall commence the payment of
monthly benefits to ▇▇▇▇▇▇▇▇'▇ spouse equal in amount to one-fourth (1/4) of the
monthly installments of Salary which was being paid to ▇▇▇▇▇▇▇▇ at the time of
his death under Section 4 herein, which monthly benefits shall be paid for a
period of twenty (20) years or until the death of ▇▇▇▇▇▇▇▇'▇ spouse, whichever
occurs first. In addition, the Company shall continue at all times to offer and
provide health insurance coverage to ▇▇▇▇▇▇▇▇'▇ spouse, in accordance with the
plans, programs, practices and policies provided by the Company under the terms
of this Agreement at the time of ▇▇▇▇▇▇▇▇'▇ death, until the death of ▇▇▇▇▇▇▇▇'▇
spouse, except to the extent such coverage is or otherwise becomes available to
▇▇▇▇▇▇▇▇'▇ spouse under the Medicare program of benefits.
(b) Disability of ▇▇▇▇▇▇▇▇. If ▇▇▇▇▇▇▇▇'▇ employment is terminated by
reason of the Disability of ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇'▇ employment under this Agreement
shall terminate without further obligations to ▇▇▇▇▇▇▇▇, other than those
obligations accrued or earned and vested (if applicable) by ▇▇▇▇▇▇▇▇ as of the
Date of Termination, including for this purpose, all Accrued Obligations and
those set forth herein. All such Accrued Obligations shall be paid to ▇▇▇▇▇▇▇▇
in a lump sum in cash within thirty (30) days of the Date of Termination.
Anything in this Agreement to the contrary notwithstanding, ▇▇▇▇▇▇▇▇ shall be
entitled after the Disability Effective Date to receive disability and other
benefits in an amount equal to one-half (1/2) of his Salary (adjusted on an
annual basis by the amount of the Annual Increase), which shall be payable in
equal monthly installments until the close of the calendar year during which
▇▇▇▇▇▇▇▇ attains sixty-five (65) years of age or until the last day of the month
in which ▇▇▇▇▇▇▇▇ is no longer deemed disabled pursuant to this Agreement, or
until ▇▇▇▇▇▇▇▇'▇ death, whichever shall first occur.
If ▇▇▇▇▇▇▇▇ shall receive any disability payments from any insurance
policies paid for by the Company, the payments to ▇▇▇▇▇▇▇▇ pursuant to this
provision shall be reduced by the amount of disability payments received by
▇▇▇▇▇▇▇▇ under any such insurance policy or policies.
If, following the termination of ▇▇▇▇▇▇▇▇'▇ employment by reason of
Disability, the
Board of Directors determines, upon competent medical advice, that ▇▇▇▇▇▇▇▇ has
recovered from said Disability to the point where he is no longer prevented by
said Disability from performing substantially all of the duties as Chief
Executive Officer of the Company, the Company shall give ▇▇▇▇▇▇▇▇ not less than
thirty (30) days written notice of its election to cease the payment of
Disability benefits to him pursuant to this Section 6(b), following which (i)
the Company shall have no further obligations to ▇▇▇▇▇▇▇▇ to make said
Disability payments as provided herein and (ii) ▇▇▇▇▇▇▇▇ thereafter shall be
entitled to retire and terminate his employment with the Company, without
further action or notice on his part, and to receive the benefits payable under
the Non- Qualified Supplemental Executive Retirement Plan of the Company (the
"SERP") (or any successor plan), as and to the extent set forth therein, and
shall hold himself available to the Board of Directors for consultation as
provided in Section 10 hereof.
Notwithstanding any Disability on the part of ▇▇▇▇▇▇▇▇, the Company
shall continue at all times to offer and provide health insurance coverages to
▇▇▇▇▇▇▇▇ and his spouse, in accordance with the most favorable plans, programs,
practices and policies provided by the Company during the 90-day period
immediately preceding the Disability Effective Date or, if more favorable to
▇▇▇▇▇▇▇▇, as in effect at any time thereafter with respect to other key
employees and their families, until the death of ▇▇▇▇▇▇▇▇ and his spouse, except
to the extent such coverage is or otherwise becomes available to ▇▇▇▇▇▇▇▇ and
his spouse under the Medicare program of benefits.
(c) CAUSE; OTHER THAN FOR GOOD REASON. If ▇▇▇▇▇▇▇▇'▇ employment shall
be terminated for Cause, ▇▇▇▇▇▇▇▇'▇ employment under this Agreement shall
terminate without further obligations to ▇▇▇▇▇▇▇▇ (other than the obligation to
pay to ▇▇▇▇▇▇▇▇ his Salary through the Date of Termination plus the amount of
any compensation previously deferred by ▇▇▇▇▇▇▇▇, together with accrued interest
thereon). If ▇▇▇▇▇▇▇▇ terminates employment other than for Good Reason, this
Agreement shall terminate without further obligations to ▇▇▇▇▇▇▇▇, other than
those obligations accrued or earned and vested (if applicable) by ▇▇▇▇▇▇▇▇
through the Date of Termination, including for this purpose, all Accrued
Obligations. All such Accrued Obligations shall be paid to ▇▇▇▇▇▇▇▇ in a lump
sum in cash within thirty (30) days of the Date of Termination.
(d) GOOD REASON; OTHER THAN FOR CAUSE OR DISABILITY. If the Company
shall terminate ▇▇▇▇▇▇▇▇'▇ employment other than for Cause, Disability, or death
or if ▇▇▇▇▇▇▇▇ shall terminate his employment for Good Reason at any time during
the Employment Period, except during a three-year period following any Change of
Control (in which case the provisions of Section 6(e) shall apply), then in such
event:
(i) the Company shall pay to ▇▇▇▇▇▇▇▇ in a lump sum in cash
within thirty (30) days after the Date of Termination the aggregate of the
following amounts:
A. to the extent not theretofore paid, ▇▇▇▇▇▇▇▇'▇ Salary through
the Date of Termination; and
B. the product of (x) the highest Annual Bonus paid to ▇▇▇▇▇▇▇▇
during the three (3) fiscal years preceding the fiscal year in which the Date of
Termination occurs (the "Recent Bonus") and (y) a fraction, the numerator of
which is the number of days in the current fiscal year through the date of
Termination and the denominator of which is 365; and
C. the product of (x) two (2.0) and (y) the sum of (i) the Salary
and (ii) the Recent Bonus; and
D. in the case of compensation previously deferred by ▇▇▇▇▇▇▇▇,
all amounts previously deferred (together with any accrued interest thereon) and
not yet paid by the Company, and any accrued vacation pay not yet paid by the
Company; and
(ii) for a two-year period following the Date of Termination,
the Company shall continue benefits to ▇▇▇▇▇▇▇▇ and/or ▇▇▇▇▇▇▇▇'▇ family at
least equal to those which would have been provided to them in accordance with
the plans, programs, practices and policies provided under this Agreement if
▇▇▇▇▇▇▇▇'▇ employment had not been terminated, including health insurance and
life insurance, in accordance with the most favorable plans, practices, programs
or policies provided by the Company and its subsidiaries during the 90-day
period immediately preceding the Date of Termination or, if more favorable to
▇▇▇▇▇▇▇▇, as in effect at any time thereafter with respect to other key
employees and their families. Notwithstanding the foregoing, however, the
Company shall continue at all times to offer and provide the above-described
health insurance coverages to ▇▇▇▇▇▇▇▇ and his spouse until their respective
dates of death, except to the extent such coverage is or otherwise becomes
available to ▇▇▇▇▇▇▇▇ and his spouse under the Medicare program of benefits.
(e) GOOD REASON; OTHER THAN FOR CAUSE OR DISABILITY, FOLLOWING A CHANGE
OF CONTROL. If, during a three year period following any Change of Control, the
Company shall terminate ▇▇▇▇▇▇▇▇'▇ employment other than for Cause, Disability,
or death or if ▇▇▇▇▇▇▇▇ shall terminate his employment for Good Reason:
(i) the Company shall pay to ▇▇▇▇▇▇▇▇ in a lump sum in cash on
the thirtieth (30th) day following the Date of Termination the aggregate of the
following amounts:
A. to the extent not theretofore paid, ▇▇▇▇▇▇▇▇'▇ Salary through
the Date of Termination; and
B. the product of (x) the Recent Bonus and (y) a fraction, the
numerator of which is the number of days in the current fiscal year through the
date of Termination and the denominator of which is 365; and
C. the product of (x) three (3.0) and (y) the sum of (i) the
Salary and (ii) the Recent Bonus; and
D. in the case of compensation previously deferred by ▇▇▇▇▇▇▇▇,
all amounts previously deferred (together with any accrued interest thereon) and
not yet paid by the Company, and any accrued vacation pay not yet paid by the
Company; and
(ii) for a three-year period following the Date of
Termination, the Company shall continue benefits to ▇▇▇▇▇▇▇▇ and/or ▇▇▇▇▇▇▇▇'▇
family at least equal to those which would have been provided to them in
accordance with the plans, programs, practices and policies provided under this
Agreement if ▇▇▇▇▇▇▇▇'▇ employment had not been terminated, including health
insurance and life insurance, in accordance with the most favorable plans,
practices, programs or policies provided by the Company and its subsidiaries
during the 90-day period immediately preceding the Date of Termination or, if
more favorable to ▇▇▇▇▇▇▇▇, as in effect at any time thereafter with respect to
other key employees and their families. Notwithstanding the foregoing, however,
the Company shall continue at all times to offer and provide the above-described
health insurance coverages to ▇▇▇▇▇▇▇▇ and his spouse until their respective
dates of death, except to the extent such coverage is or otherwise becomes
available to ▇▇▇▇▇▇▇▇ and his spouse under the Medicare program of benefits.
(f) ALTERNATIVE EXCISE TAX CAP. Notwithstanding the provisions of
Section 6(e) hereof, if any payments or benefits received or to be received by
▇▇▇▇▇▇▇▇ (whether pursuant to the terms of this Agreement or any other plan,
arrangement or agreement with the Company, any person whose actions result in a
Change of Control or any person affiliated with the Company or such person)
constitute "parachute payments" within the meaning of Section 280G(b)(2)(A) of
the Code and the value thereof exceeds 2.99 times ▇▇▇▇▇▇▇▇'▇ "base amount," as
defined in Section 280G(b)(3) of the Code, then, in lieu thereof, the Company
shall pay to ▇▇▇▇▇▇▇▇, as soon as practicable following the Date of Termination
but in no event later than thirty (30) days thereafter, a lump sum cash payment
equal to 2.99 times his "base amount" (the "Alternative Severance Payment"),
reduced as provided below. The value of the payments to be made under Section
6(e) and ▇▇▇▇▇▇▇▇'▇ base amount shall be determined in accordance with temporary
or final regulations, if any, promulgated under Section 280G of the Code and
based upon the advice of the tax counsel referred to below.
The Alternative Severance Payment shall be reduced by the amount of any
other payment or the value of any benefit received or to be received by ▇▇▇▇▇▇▇▇
in connection
with a Change of Control of the Company or his termination of employment unless
(i) ▇▇▇▇▇▇▇▇ shall have effectively waived his receipt or enjoyment of such
payment or benefit prior to the date of payment of the Alternative Severance
Payment, (ii) in the opinion of tax counsel selected by the Company's
independent auditors, such other payment or benefit does not constitute a
"parachute payment" within the meaning of Section 280G(b)(2) of the Code, or
(iii) in the opinion of such tax counsel, the Alternative Severance Payment plus
all other payments or benefits which constitute "parachute payments" within the
meaning of Section 280G(b)(2) of the Code are reasonable compensation for
services actually rendered within the meaning of Section 280G(b)(4) of the Code
or are otherwise not subject to disallowance as a deduction by reason of Section
280G of the Code. The value of any non-cash benefit or any deferred payment or
benefit shall be determined in accordance with the principles of Section
280G(d)(3) and (4) of the Code.
(g) SECTION 162(M) LIMITATION. In the event that the payments due to
▇▇▇▇▇▇▇▇ under this Section 6 exceed the "reasonable compensation" limitations
of Section 162(m) of the Code, that portion thereof that would not be deductible
by the Company in the taxable year in which the payment is due shall be deferred
by the Company and paid to ▇▇▇▇▇▇▇▇ on the date that is sixteen (16) months
following the Date of Termination, together with interest thereon at the rate
provided in Section 7872(f)(2) of the Code.
7. NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement shall prevent
or limit ▇▇▇▇▇▇▇▇'▇ continuing or future participation in any benefit, bonus,
incentive or other plans, programs, policies or practices, provided by the
Company and for which ▇▇▇▇▇▇▇▇ may qualify, including but not limited to the
SERP, nor shall anything herein limit or otherwise affect such rights as
▇▇▇▇▇▇▇▇ may have under the SERP or any stock option or other agreements with
the Company. Amounts which are vested benefits or which ▇▇▇▇▇▇▇▇ is otherwise
entitled to receive under any plan, policy, practice or program of the Company
at or subsequent to the Date of Termination, including but not limited to the
SERP, shall be payable in accordance with the SERP or such plan, policy,
practice or program.
8. FULL SETTLEMENT. The Company's obligation to make the payments
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Company may have against
▇▇▇▇▇▇▇▇ or others. In no event shall ▇▇▇▇▇▇▇▇ be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable
to ▇▇▇▇▇▇▇▇ under any of the provisions of this Agreement, but such payments
shall be reduced to the extent of ▇▇▇▇▇▇▇▇'▇ other earned income (if any) during
any remaining portion of the Employment Period. Following any Change of Control,
the Company agrees to pay, to the full extent permitted by law, all
legal fees and expenses which ▇▇▇▇▇▇▇▇ may reasonably incur as a result of any
contest (regardless of the outcome thereof) by the Company or others (including
▇▇▇▇▇▇▇▇) of the validity or enforceability of, or liability under, any
provision of this Agreement or any guarantee of performance thereof, plus in
each case interest at the applicable Federal rate provided for in Section
7872(f)(2) of the Code.
9. RETIREMENT OF ▇▇▇▇▇▇▇▇. It is understood that ▇▇▇▇▇▇▇▇ shall retire
on the last day of the calendar year during which he reaches sixty-five (65)
years of age. The Board of Directors of the Company, at its sole option, may
offer to extend ▇▇▇▇▇▇▇▇'▇ employment on a year-to-year basis after the calendar
year in which ▇▇▇▇▇▇▇▇ reaches age sixty-five (65). At the conclusion of each
year it will be presumed that ▇▇▇▇▇▇▇▇ will retire unless the Board of Directors
determines to offer to extend ▇▇▇▇▇▇▇▇'▇ employment for an additional year.
Following the retirement of ▇▇▇▇▇▇▇▇, the Company shall continue at all
times to offer and provide health insurance coverages to ▇▇▇▇▇▇▇▇ and his
spouse, in accordance with the most favorable plans, programs, practices and
policies provided by the Company during the 90-day period immediately preceding
the effective date of ▇▇▇▇▇▇▇▇'▇ retirement or, if more favorable to ▇▇▇▇▇▇▇▇,
as in effect at any time thereafter with respect to other key employees and
their families, until the death of ▇▇▇▇▇▇▇▇ and his spouse, except to the extent
such coverage is or otherwise becomes available to ▇▇▇▇▇▇▇▇ and his spouse under
the Medicare program of benefits.
10. AVAILABILITY OF ▇▇▇▇▇▇▇▇ AFTER RETIREMENT. Following his
retirement, ▇▇▇▇▇▇▇▇ shall at reasonable times and insofar as his physical
condition may permit, hold himself available at the written request of the Board
of Directors of the Company to consult with and advise the officers, directors,
and other representatives of the Company. Such requests for ▇▇▇▇▇▇▇▇'▇ service
shall, however, be structured so that reasonable allowances are made for
▇▇▇▇▇▇▇▇'▇ needs for vacation time and for other considerations of his physical
well-being. All such services shall be provided by ▇▇▇▇▇▇▇▇ at his place of
residence unless otherwise agreed to by ▇▇▇▇▇▇▇▇. ▇▇▇▇▇▇▇▇ shall not be required
to devote any prescribed hours to consulting with and giving advice to the
officers, directors, and other representatives of the Company in order to be
entitled to the retirement benefits as set out in the SERP, but all such
benefits shall be considered as earned in return for the consulting service and
advice that ▇▇▇▇▇▇▇▇ may give from time to time to the Company, its officers,
directors, and other representatives.
If ▇▇▇▇▇▇▇▇'▇ physical condition shall prevent him from consulting and
advising with the officers, directors or other representatives of the Company,
the retirement benefits provided under the SERP shall nonetheless be paid as
therein provided.
▇▇▇▇▇▇▇▇ shall be reimbursed by the Company for all reasonable expenses
incurred
as a consultant and advisor, including expenses for travel, communication,
entertainment and similar items, upon presentation of itemized accounts of such
expenditures.
11. DISCRETION OF BOARD OF DIRECTORS. Notwithstanding any other term or
provision of this Agreement to the contrary, nothing stated herein is intended
to, nor shall it be construed, to abrogate, limit, alter or affect the
authority, rights and privileges of the Board of Directors of the Company to
remove ▇▇▇▇▇▇▇▇ as Chief Executive Officer or Chairman of the Board of the
Company, without Cause, or during the term of this Agreement to elect as Chief
Executive Officer or Chairman of the Board of Directors of the Company a person
other than ▇▇▇▇▇▇▇▇, as provided by the laws of the State of Iowa; provided,
however, it is expressly agreed and understood that, in the event any one or any
combination of such events occurs, unless ▇▇▇▇▇▇▇▇ is terminated for Cause as
defined in Section 5(b) hereof, ▇▇▇▇▇▇▇▇ may terminate his employment for Good
Reason, in which case the Company shall pay ▇▇▇▇▇▇▇▇ the benefits described in
either Section 6(d) or Section 6(e) of this Agreement, as applicable, in
consideration thereof.
12. CONFIDENTIAL INFORMATION; RESTRICTIVE COVENANT. (a) During the
period of his employment, ▇▇▇▇▇▇▇▇ shall hold in fiduciary capacity for the
benefit of the Company all secret or confidential information, knowledge or data
relating to the Company or any of its subsidiaries, and their respective
businesses, which shall have been obtained by ▇▇▇▇▇▇▇▇ during ▇▇▇▇▇▇▇▇'▇
employment by the Company or any of its subsidiaries and which shall not be or
become public knowledge (other than by acts by ▇▇▇▇▇▇▇▇ or his representatives
in violation of this Agreement). During a three (3) year period following
termination of ▇▇▇▇▇▇▇▇'▇ employment with the Company, ▇▇▇▇▇▇▇▇ shall not,
without the prior written consent of the Company, communicate or divulge any
such information, knowledge or data to anyone other than the Company and those
designated by it.
(b) While this Agreement remains in effect and ▇▇▇▇▇▇▇▇ is entitled to
compensation or benefits pursuant to Sections 4 through 6 hereof (or, in the
event of termination of his employment for Good Reason, for a period of three
(3) years thereafter), ▇▇▇▇▇▇▇▇ shall not directly or indirectly associate with,
participate in or render service to, whether as an employee, officer, director,
consultant, independent contractor or otherwise, any organization that is
engaged in business in competition with the Company, and he shall not himself
engage in any such business on his own account.
(c) In the event of a demonstrated breach of this Section 12, the
parties agree that the Company shall be entitled to seek equitable relief in a
court of competent jurisdiction to prevent any anticipated continuing breach of
the terms and conditions of this Section 12 and to secure the enforcement
thereof. The foregoing remedy shall be exclusive and in lieu of any other remedy
otherwise available to the Company under law.
13. SUCCESSORS. (a) This Agreement is personal to ▇▇▇▇▇▇▇▇ and without the
prior written consent of the Company shall not be assignable by ▇▇▇▇▇▇▇▇
otherwise than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of and be enforceable by ▇▇▇▇▇▇▇▇'▇ legal
representatives.
(b) This Agreement shall inure to the benefit of and be binding
upon the Company and its successors and assigns.
(c) The Company agrees and covenants to require (i) any successor or
assignee (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Company through a Change of Control or otherwise, and, (ii) within its lawful
power to do so, any party effecting or taking steps to accomplish a Change of
Control, to assume expressly and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform it
if no such succession or Change of Control had taken place. As used in this
Agreement, "Company" shall mean the Company as hereinbefore defined and any
successor to its business and/or assets as aforesaid which assumes and agrees to
perform this Agreement by operation of law, or otherwise.
14. MISCELLANEOUS. (a) This Agreement shall be governed by and construed in
accordance with the laws of the State of Iowa, without reference to principles
of conflict of laws. The captions of this Agreement are not part of the
provisions hereof and shall have no force or effect. This Agreement may not be
amended or modified otherwise than by a written agreement executed by the
parties hereto or their respective successors and legal representatives.
(b) All notices and other communications hereunder shall be in writing
and shall be given by hand delivery to the other party or by registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
If the Company, to ▇▇▇▇▇'▇ General Stores, Inc., P. O. ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇., ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attention: President; and if to ▇▇▇▇▇▇▇▇, to his
address appearing on the books of the Company, or to his residence, or to such
other address as either party shall have furnished to the other in writing in
accordance herewith. Notice and communications shall be effective when actually
received by the addressee.
(c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement.
(d) The Company may withhold from any amounts payable under this
Agreement such Federal, state or local taxes as shall be required to be withheld
pursuant to any applicable law or regulation.
(e) The Company's or ▇▇▇▇▇▇▇▇'▇ failure to insist upon strict
compliance with any provision hereof shall not be deemed to be a waiver of such
provision or any other provision thereof.
(f) This Agreement contains the entire understanding of the Company and
▇▇▇▇▇▇▇▇ with respect to the subject matter hereof. The Original Agreement
between ▇▇▇▇▇▇▇▇ and the Company, as defined in the preambles hereof, is hereby
terminated and shall be of no further force or effect.
(g) No change, amendment or modification of this Agreement shall be
valid unless the same be in writing and signed by the Company and ▇▇▇▇▇▇▇▇.
(h) This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original and all of which taken together shall
constitute one and the same instrument with the same force and effect as if all
the parties had executed the same document.
IN WITNESS WHEREOF, the respective parties have caused this Agreement
to be executed as of the day and year first above written.
▇▇▇▇▇'▇ GENERAL STORES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇, President
ATTEST:
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇, Secretary
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
