Exhibit 10-A
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is dated and effective as of the
27th day of September, 2002 ("Effective Date"), and is by and between National
Steel Corporation, a Delaware corporation (the "Company"), and ▇▇▇▇▇ ▇▇▇▇▇▇▇
("Executive"). In consideration of the mutual covenants contained herein, and
other good and valuable consideration (including the Termination Benefits and
the Special Termination Benefits) the receipt and adequacy of which the Company
and Executive each hereby acknowledges, the Company and Executive hereby agree
as follows:
1. Employment and Term
The Company hereby agrees to employ Executive as the Chief Executive
Officer of the Company and Executive hereby agrees to accept such employment and
serve in such capacity on a full-time basis during the Term and upon the terms
and conditions set forth in this Employment Agreement (this "Agreement").
Executive shall report solely to the Company's Board of Directors, and will have
such responsibilities, duties and authorities as are customary for such
positions in a publicly held company of the size, type and nature of the Company
as they may exist from time to time. The term of employment of Executive under
this Agreement shall be the period commencing on the Effective Date and
terminating on February 29, 2004 (the "Term"). The respective rights and
obligations of the parties hereunder shall survive any termination of employment
to the extent necessary to achieve the intended preservation of rights and
obligations.
2. Salary and Annual Incentive Compensation.
Executive's annual base salary as in effect on the Effective Date shall
be the Executive's annual base salary hereunder as of the Effective Date,
payable in consecutive equal monthly installments. The term "base salary" as
utilized in this Agreement shall refer to the then current base salary as
adjusted from time to time. Executive's annual base salary shall be reviewed
periodically in accordance with the Company's compensation policies and
practices for senior executives, and may be increased from time to time in
accordance with such policies and practices, but shall not be decreased.
Executive shall also be eligible to receive annual incentive compensation
pursuant to the Company's Management Incentive Compensation Program or any
successor plan (the "MICP") during the Term and as determined in accordance with
the terms and conditions of the MICP. Executive's MICP target annual incentive
compensation for 2002 shall be 50% of base salary, multiplied by a fraction, the
numerator of which shall be the number of days employed by the Company in 2002,
and the denominator of which shall be 365. The Company will maintain in effect,
for each year during the Term, the MICP or an equivalent plan under which
Executive will be eligible for an award not less than the prior year opportunity
level available to Executive. Any such annual incentive compensation payable to
Executive shall be
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paid in accordance with the Company's usual practices with respect to payment of
incentive compensation of senior executives.
3. Benefit and Compensation Plans.
(a) Executive shall be entitled during the Term to participate in all
executive compensation plans, and other employee and executive benefits,
practices, policies and programs of the Company, as presently in effect or as
they may be modified or added to by the Company from time to time ("Benefit
Plans").
(b) During the Term, the Company will provide Executive with coverage
by Company-paid group or individual life insurance or a combination thereof, all
in accordance with the plans, policies, programs and arrangements as presently
in effect or as they may be modified or added to by the Company from time to
time.
(c) During the Term, Executive will participate in the Company's
Executive Deferred Compensation Plan, and any supplemental retirement plans,
benefits, practices, programs, or policies of the Company, as in effect on the
Effective Date or as they may be modified or added to by the Company from time
to time ("Compensation Plans").
4. Non-Compete Agreement.
Executive hereby agrees that if Executive terminates his employment
with the Company without Good Reason, then for a period of two (2) years after
the Date of Termination, but in any event only as long as the Company satisfies
its obligations under this Agreement (the "Restricted Period"), Executive will
not engage (either as owner, investor, partner, stockholder, employer, employee,
consultant, advisor or director) in any "Competitive Business" in the
continental United States (the "Territory"). The term "Competitive Business"
means the making, producing, manufacturing or finishing of steel products which
products are in direct competition with steel products that are made, produced,
manufactured or finished by the Company on the Date of Termination. It is agreed
that the ownership of not more than one percent of the equity securities of any
company having securities listed on an exchange or regularly traded in the
over-the-counter market shall not be deemed inconsistent with this Section 4. If
any court of competent jurisdiction shall deem any obligation of this Section 4
too lengthy or the Territory too extensive, the other provisions of this Section
shall nevertheless stand, the Restricted Period shall be deemed to be the
longest period such court deems not to be too lengthy and the Territory shall be
deemed to comprise the portion of the United States east of the Mississippi
River (or such other portion of the United States that such court deems not to
be too extensive).
5. Non-Inducement.
Executive hereby agrees that for a period commencing with the Date of
Termination and ending on the second anniversary of the Date of Termination,
Executive shall not induce, or attempt to influence, any employee of the Company
who reports either directly to the Company's
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Chief Executive Officer or President and Chief Operating Officer or to another
employee who reports directly to the Company's Chief Executive Officer or
President and Chief Operating Officer to terminate his employment with the
Company.
6. Non-Disclosure.
For a period commencing on the Date of Termination and ending on the
fifth anniversary of the Date of Termination, Executive shall keep secret and
retain in strictest confidence, and shall not furnish, make available or
disclose to any third party or use for the benefit of himself or any third
party, any Confidential Information. As used in this Section, "Confidential
Information" shall mean any information relating to the business or affairs of
the Company, including but not limited to information relating to financial
statements, customer identities, customer needs, potential customers, employees,
suppliers, servicing methods, equipment, programs, strategies and information,
analyses, profit margins or other proprietary information used by the Company in
connection with its business; provided, however, that Confidential Information
shall not include any information which is in the public domain or becomes known
in the industry through no wrongful act on the part of Executive. Executive
acknowledges that the Confidential Information is vital, sensitive, confidential
and proprietary to the Company.
7. No Unfavorable Publicity.
Subsequent to Executive's Date of Termination, Executive agrees not to
make statements or communications and not to issue any written communications or
release any other written materials which would likely be materially damaging to
the Company's reputation or standing, whether in the investor or financial
community, the steel industry or otherwise.
8. Cooperation With the Company.
Executive agrees to cooperate with the Company for a reasonable period
of time after the Term of this Agreement by making himself available to testify
on behalf of the Company, in any action, suit, or proceeding. In addition, for a
reasonable period of time, Executive agrees to be available at reasonable times
to meet and consult with the Company on matters reasonably within the scope of
his prior duties with the Company so as to facilitate a transition to his
successor. The Company agrees to reimburse Executive, on an after-tax basis, for
all expenses actually incurred in connection with his provision of testimony or
consulting assistance.
9. Release of Employment Claims.
Executive and the Company agree that in the event Executive receives
Special Termination Benefits (as defined in Section 11(f)), he and the Company
will execute a mutual release agreement releasing any and all claims which
either of them have or may have against the other arising out of Executive's
employment (other than enforcement of this Agreement). The Executive agrees that
in the event the Executive's employment with the Company terminates or
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is terminated, the Executive's sole and exclusive remedy shall be, and the
Company's liability shall be limited to, damages equal to the payments and
benefits to be provided by the Company hereunder and to payment or reimbursement
of Executive's costs and expenses in accordance with Section 12(b).
10. Remedies.
Executive acknowledges and agrees that the covenants set forth in
Sections 4 through 8 are reasonable and necessary for the protection of the
Company's business interests, that irreparable injury will result to the Company
if Executive breaches any of the terms of such covenants, and that in the event
of Executive's actual or threatened breach of any such covenants, the Company
will have no adequate remedy at law. Executive accordingly agrees that in the
event of any actual or threatened breach by him of any of such covenants, the
Company shall be entitled to immediate temporary injunctive and other equitable
relief, without the necessity of showing actual monetary damages, subject to
hearing as soon thereafter as possible. Nothing contained herein shall be
construed as prohibiting the Company from pursuing any other remedies available
to it for such breach or threatened breach, including the recovery of any
damages which it is able to prove.
11. Termination of Employment.
(a) Termination Due to Death or Disability. Upon an Executive's Date of
Termination during the Term due to death or Disability, the Company will pay
Executive (or his beneficiaries, dependents or estate), and Executive (or his
beneficiaries, dependents or estate) will be entitled to receive, the
Termination Benefits (as defined in Section 11(e)).
(b) Termination by the Company for Cause and Termination by Executive
without Good Reason. Upon Executive's Date of Termination during the Term by the
Company for Cause or by Executive without Good Reason the Company shall pay
Executive (or his beneficiaries, dependents or estate), and Executive (or his
beneficiaries, dependents or estate) shall be entitled to receive, the
Termination Benefits (as defined in Section 11(e)), except that no amount shall
be paid and no right accrued in respect of Executive under Section 11(e)(i)(B).
(c) Termination by the Company Without Cause and Termination by
Executive for Good Reason. Upon Executive's Date of Termination during the Term
by the Company without Cause or by Executive for Good Reason the Company shall
pay Executive (or his beneficiaries, dependents or estate), and Executive (or
his beneficiaries, dependents or estate) shall be entitled to receive, the
Termination Benefits (as defined in Section 11(e)) and the Special Termination
Benefits (as defined in Section 11(f)).
(d) Termination Following Expiration of the Term. Upon termination of
employment following expiration of the Term, whether by the Executive with or
without Good Reason, or by the Company, without Cause, the Company shall pay
Executive (or his beneficiaries, dependents, or estate), and Executive (or his
beneficiaries, dependents, or estate) shall be entitled to receive,
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the Termination Benefits (as defined in Section 11(e)) and the Special
Termination Benefits (as defined in Section 11(f)).
(e) "Termination Benefits". "Termination Benefits" means the aggregate
of all of the following:
(i) a single sum cash payment by the Company to Executive within
thirty (30) days after the Date of Termination of
(A) Executive's then current annual base salary pro rata
through the Date of Termination to the extent not theretofore paid; (B) the
product of (y) the greater of (aa) the average annual incentive compensation
paid to Executive in the three fiscal years immediately preceding the fiscal
year of the Date of Termination (or all fiscal years Executive was employed if
less than three, and annualized in the event Executive was not employed by the
Company for the whole of any such fiscal year), and (bb) Executive's target
incentive compensation percentage payable under the MICP multiplied by
Executive's then current base salary and (z) 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) any accrued vacation
pay to the extent not theretofore paid.
(ii) All vested amounts owing or accrued at the Date of
Termination under any compensation and benefit plans, programs, and arrangements
set forth or referred to in this Agreement, including, but not limited to,
Sections 2 and 3 hereof; and if the Date of Termination is due to death,
Executive's estate or other beneficiaries shall receive the death benefits
described in Section 3(b).
(iii) Reasonable business expenses and disbursements incurred by
Executive prior to such Date of Termination will be fully reimbursed within ten
(10) days after the Date of Termination.
(f) "Special Termination Benefits". "Special Termination Benefits"
means the aggregate of all of the following:
(i) The Company shall pay to Executive, in a single sum in cash
within thirty (30) days after the Date of Termination, an amount equal to fifty
percent of Executive's annual base salary (immediately preceding the Date of
Termination).
(ii) For two years after Executive's Date of Termination, if
Executive is less than age 69 on his Date of Termination, or such longer period
as may be provided by the terms of the appropriate plan, program, arrangement,
practice or policy, the Company shall continue benefits to Executive and/or
Executive's dependents at least equal to those which would have been provided to
them in accordance with the Benefits Plans or this Agreement if Executive's
employment had not been terminated or, if more favorable to Executive, as in
effect generally at any time thereafter with respect to other peer executives of
the Company and their dependents;
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provided, however, that notwithstanding anything in this Agreement to the
contrary, if Executive is eligible to receive health benefits or other benefits
under an NKK Corporation sponsored plan or arrangement, or any Japanese
government plan or arrangement, or under any other plan or arrangement, the
health benefits and other benefits described herein shall be secondary to those
provided under such other plan or arrangement during such applicable period of
eligibility; and provided, further, that if Executive shall later become
ineligible for health benefits or other benefits under such other plans and
arrangements, the health benefits or other benefits provided by the Company
shall be primary. If Executive is age 69 or older on his Date of Termination,
the period of "two years" in the first line of this Section 11(f) (ii) shall be
reduced to the period set forth below:
Age Period
----- --------
69 One Year
70 or older Zero
(iii) Stock options held by Executive as of the date of this
Agreement were granted pursuant to the 1993 National Steel Corporation
Non-Employee Directors' Stock Option Plan and shall continue to be governed by
the terms and conditions of said Non-Employee Directors' Stock Option Plan.
Stock options granted to Executive after the date of this Agreement shall be
issued pursuant to the 1993 National Steel Corporation Long Term Incentive Plan
and shall continue to vest as if Executive had remained an employee of the
Company and shall remain fully exercisable for the lesser of (a) the entire
period that would have been available for exercise had Executive continued in
the employ of the Company through the original option term or (b) five years;
such stock options shall otherwise be governed by the terms and conditions of
said Long Term Incentive Plan (and the agreements and other documents
thereunder) pursuant to which such stock options were granted.
12. Governing Law; Disputes; Arbitration.
(a) Governing Law. This Agreement is governed by and is to be
construed, administered, and enforced in accordance with the laws of the State
of Indiana, without regard to Indiana conflicts of law principles, except
insofar as the Delaware General Corporation Law and federal laws and regulations
may be applicable. If under the governing law, any portion of this Agreement is
at any time deemed to be in conflict with any applicable statute, rule,
regulation, ordinance, or other principle of law, such portion shall be deemed
to be modified or altered to the extent necessary to conform thereto or, if that
is not possible, to be omitted from this Agreement. The invalidity of any such
portion shall not affect the force, effect, and validity of the remaining
portion hereof.
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(b) Reimbursement of Expenses in Enforcing Rights. All costs and
expenses (including, without limitation, fees and disbursements of actuaries,
accountants and counsel) incurred by Executive in seeking in good faith to
enforce rights pursuant to this Agreement shall be paid on behalf of or
reimbursed to Executive promptly by the Company, whether or not Executive is
successful in asserting such rights. If there shall be any dispute between the
Company and Executive, the Company shall pay or provide, as applicable, all
undisputed amounts or benefits as are then payable to Executive or Executive's
beneficiaries or dependents pursuant to this Agreement. Any amounts that have
become payable pursuant to the terms of this Agreement or any decision by
arbitrators or judgment by a court of law, but which are not timely paid shall
bear interest, payable by the Company, at the lower of (A) the highest lawful
rate or (B) the prime rate in effect at the time such payment first becomes
payable, as quoted by The Wall Street Journal.
(c) Arbitration. Any dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration in
Chicago, Illinois, in accordance with the rules of the American Arbitration
Association in effect at the time of submission to arbitration, by three (3)
arbitrators, one of which shall be chosen by the Company, one of which shall be
chosen by Executive, and one of which shall be chosen by the arbitrators chosen
by Company and Executive. Judgment may be entered on the arbitrators' award in
any court having jurisdiction. For purposes of entering any judgment upon an
award rendered by the arbitrators, the Company and Executive hereby consent to
the jurisdiction of any or all of the following courts: (i) the United States
District Court for the Northern District of Indiana; (ii) any of the courts of
the State of Indiana, or (iii) any other court having jurisdiction. The Company
and Executive further agree that any service of process or notice requirements
in any such proceeding shall be satisfied if the rules of such court relating
thereto have been substantially satisfied. The Company and Executive hereby
waive, to the fullest extent permitted by applicable law, any objection which it
may now or hereafter have to such jurisdiction and any defense of inconvenient
forum. The Company and Executive hereby agree that a judgment upon an award
rendered by the arbitrators may be enforced in other jurisdictions by suit on
the judgment or in any other manner provided by law. The Company shall bear all
costs and expenses arising in connection with any arbitration proceeding.
Notwithstanding any provision in this Section 12(c), Executive shall be entitled
to seek specific performance of Executive's right to be paid during the pendency
of any dispute or controversy arising under or in connection with this
Agreement.
13. Definitions.
Certain terms in this Agreement are defined the first time they appear;
other terms which are capitalized are not defined the first time they appear,
but unless the context indicates otherwise, have the meanings set forth below:
(a) "Cause". For purposes of this Agreement, "Cause" shall mean
Executive's gross misconduct (as defined herein) or willful and material breach
of this Agreement. For purposes of this definition, "gross misconduct" shall
mean (A) a felony conviction or a plea of nolo
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contendere to a felony charge in a court of law under applicable federal or
state laws which results in material damage to the Company, or (B) willfully
engaging in one or more acts which is demonstrably and materially damaging to
the Company. Notwithstanding the foregoing, Executive may not be terminated for
Cause unless and until there shall have been delivered to him, within six months
after the Board (A) had knowledge of conduct or an event allegedly constituting
Cause and (B) had reason to believe that such conduct or event could be grounds
for Cause, a copy of a resolution duly adopted by a majority affirmative vote of
the entire membership of the Company's Board of Directors (excluding Executive
if a member of Company's Board of Directors), at a meeting of the Board called
and held for such purpose (after giving Executive reasonable notice specifying
the nature of the grounds for such termination and not less than 30 days to
correct the acts or omissions complained of, if correctable, and affording
Executive the opportunity, together with his counsel, to be heard before the
Board) finding that, in the good faith opinion of the Board, Executive was
guilty of conduct set forth above in this Section 13 (a).
(b) "Date of Termination". "Date of Termination" means (i) if
Executive's employment is terminated by the Company for Cause or by Executive
for Good Reason, the date of receipt of the Notice of Termination or any later
date specified therein, as the case may be; (ii) if Executive's employment is
terminated by the Company without Cause, the Date of Termination shall be the
date on which the Company notifies Executive of such Date of Termination, and
(iii) if Executive's employment is terminated by reason of death or Disability,
or is terminated by Executive without Good Reason, the Date of Termination shall
be the date of death of Executive, the Disability Effective Date, or the date
Executive notifies the Company that Executive's employment will terminate, as
the case may be. If the Company determines in good faith that the Disability of
Executive has occurred during the Term of the Agreement (pursuant to the
definition of Disability set forth in Section 13 (c)), it may give to Executive
written notice in accordance with Section 13(e) of this Agreement of its
intention to terminate Executive's employment. In such event, Executive's Date
of Termination is effective on the date that is six months after receipt of such
notice by Executive (the "Disability Effective Date"), provided that, within
such six month period, Executive shall not have returned to full-time
performance of Executive's duties. Any termination by the Company for Cause, or
by Executive for Good Reason, shall be communicated by Notice of Termination to
the other party hereto given in accordance with Section 13 (e) of this
Agreement.
(c) "Disability". "Disability" means the failure of Executive to render
and perform the services required of him under this Agreement, for a total of
180 days or more during any consecutive 12 month period, because of any physical
or mental incapacity or disability as determined by a physician or physicians
selected by the Company and reasonably acceptable to Executive, unless, within
six (6) months after Executive has received written notice from the Company of a
proposed Date of Termination due to such absence, Executive shall have returned
to the full performance of his duties hereunder and shall have presented to the
Company a written certificate of Executive's good health prepared by a physician
selected by Executive and reasonably acceptable to the Company.
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(d) "Good Reason". For purposes of this Agreement, "Good Reason" shall
mean the occurrence of any of the following events set forth in paragraphs (i)
through (vii) below, without Executive's prior written consent.
(i) the diminution of Executive's status, titles, positions,
duties, offices, authorities, responsibilities, assignments or reporting
relationships, or removal from Executive of any status, titles, positions,
duties, offices, authorities, responsibilities, assignments or reporting
relationships, which is inconsistent in any respect with Executive's status,
titles, positions, duties, offices, authorities, responsibilities, assignments
or reporting relationships, as contemplated by Section 1 of this Agreement,
excluding for this purpose (a) any removal of the title "Chairman of the Board,"
the removal of Executive from the Board, or any failure to elect or re-elect, or
nominate Executive to the Board, (b) any search for a new Chief Executive
Officer or other transition or succession planning for a new Chief Executive
Officer, (c) any announcement of an appointment of a new Chief Executive
Officer, with an effective date after the Term hereof, or (d) 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
Executive;
(ii) any reduction in Executive's then current base salary or in
Executive's then current target incentive compensation opportunity under the
MICP;
(iii) any failure by the Company to comply with any of the
provisions of this Agreement, including but not limited to Sections 2 and 3 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 Executive;
(iv) any failure by the Company to perform any obligation under,
or breach by the Company of any provision of, this Agreement;
(v) any purported termination by the Company of Executive's
employment otherwise than as expressly permitted by this Agreement;
(vi) any failure by the Company to comply with and satisfy Section
14(c) of this Agreement; or
(vii) voluntary termination of employment by Executive with the
prior approval of a simple majority of the Board.
(e) "Notice of Termination". "Notice of Termination" means a written
notice which (i) indicates the specific termination provision in this Agreement
relied upon, (ii) to the extent applicable, sets forth the facts and
circumstances claimed to provide a basis for termination of Executive's
employment under the provision so indicated and (iii) if the Date of Termination
is other than the date of receipt of such notice, specifies the Date of
Termination. The failure by Executive or the Company to set forth in the Notice
of Termination any fact or circumstance which contributes to a showing of Good
Reason or Cause shall not waive any right of Executive
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or the Company, respectively, hereunder or preclude Executive or the Company,
respectively, from asserting such fact or circumstance in enforcing Executive's
or the Company's rights hereunder.
(f) "Board" or "Board of Directors". "Board" or "Board of Directors"
means the full board of directors of the Company as it may be constituted in
accordance with applicable law from time to time, and any committee of the board
shall not be deemed to be the Board or Board of Directors for purposes of this
Agreement.
14. Miscellaneous.
(a) Integration. This Agreement modifies and supersedes any and all
prior employment agreements. This Agreement constitutes the entire agreement
among the parties with respect to the matters herein provided, and no
modification or waiver of any provision hereof shall be effective unless in
writing and signed by the parties hereto.
(b) Nonexclusivity of Rights. Nothing in this Agreement shall prevent
or limit Executive's continuing or future participation in any plan, program,
policy or practice provided by the Company during the Term of this Agreement and
for which Executive may qualify, nor shall anything herein limit or otherwise
affect such rights as Executive may have under any contract or agreement with
the Company. Amounts which are vested benefits or which Executive is otherwise
entitled to receive under any plan, policy, practice or program of or any
contract or agreement with the Company at or subsequent to the Date of
Termination shall be payable in accordance with such plan, policy, practice or
program or contract or agreement except as explicitly modified by this
Agreement. In the event of any conflict between the terms and provisions of this
Agreement and any of the Company's plans, policies, practices, programs,
contracts or agreements, the terms and provisions of whichever is more favorable
to the Executive shall prevail.
(c) Non-Transferability. Neither this Agreement nor the rights or
obligations hereunder of the parties hereto shall be transferable or assignable
by Executive, except in accordance with the laws of descent and distribution or
as specified in Section 14(d). The Company may, but only with the consent of
Executive, assign this Agreement and the Company's rights and obligations
hereunder, and the Company shall, as a condition of the succession, require such
Successor to assume (jointly and severally with the Company) the Company's
obligations and be bound by this Agreement. Any such assignment shall not
release the Company of any of its obligations under this Agreement. For purposes
of this Agreement, "Successor" shall mean any person that succeeds to, or has
the practical ability to control (either immediately or with the passage of
time), the Company's business directly, by merger or consolidation, or
indirectly, by purchase of the Company's voting securities or all or
substantially all of its assets, or otherwise.
(d) Beneficiaries. Executive shall be entitled to designate (and
change, to the extent permitted under applicable law) a beneficiary or
beneficiaries to receive any compensation or
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benefits payable hereunder following Executive's death. If Executive should die
while any amount would still be payable to him hereunder had Executive continued
to live, all such amounts, unless otherwise provided herein, shall be paid in
accordance with the terms of this Agreement to his devisee, legatee or other
designee or, if there is no such designee, to his estate.
(e) Notices. Whenever under this Agreement it becomes necessary to give
notice, such notice shall be in writing, signed by the party or parties giving
or making the same, and shall be served on the person or persons for whom it is
intended or who should be advised or notified, by overnight courier service or
by certified or registered mail, return receipt requested, postage prepaid and
addressed to such party at the address set forth below or at such other address
as may be designated by such party by like notice:
If to the Company:
General Counsel
National Steel Corporation
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If to the Executive at his then current address reflected in the
Company's records.
If the parties by mutual agreement supply each other with telecopier
numbers for the purposes of providing notice by facsimile, such notice shall
also be proper notice under this Agreement when sent. In the case of overnight
courier service, such notice or advice shall be effective when sent, and, in the
cases of certified or registered mail, shall be effective 2 days after deposit
into the mails by delivery to the U.S. Post Office.
(f) Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
(g) No General Waivers. The failure of any party at any time to require
performance by any other party of any provision hereof or to resort to any
remedy provided herein or at law or in equity shall in no way affect the right
of such party to require such performance or to resort to such remedy at any
time thereafter, nor shall the waiver by any party of a breach of any of the
provisions hereof be deemed to be a waiver of any subsequent breach of such
provisions. No such waiver shall be effective unless in writing and signed by
the party against whom such waiver is sought to be enforced.
(h) No Obligation To Mitigate. Executive shall not be required to seek
other employment or otherwise to mitigate Executive's damages on or after
Executive's Date of
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Termination, and the amount of any payment or benefit provided for in this
Agreement shall not be reduced by any compensation or benefits earned by
Executive as the result of employment by another employer or by retirement
benefits; provided, however, that, the health benefits or other benefits that
Executive is entitled to receive after the Date of Termination may be reduced in
accordance with the terms of Section 11 (f) (ii).
(i) Offsets; Withholding. The amounts required to be paid by the
Company to Executive pursuant to this Agreement shall not be subject to offset.
The foregoing and other provisions of this Agreement notwithstanding, all
payments to be made to Executive under this Agreement, including under Section
11, or otherwise by the Company, will be subject to required withholding taxes
and other required deductions.
(j) Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of Executive, his heirs, executors, administrators
and beneficiaries, and shall be binding upon and inure to the benefit of the
Company and its permitted successors and assigns as provided in Section 14(c).
This Agreement is a personal contract and the rights and interests of Executive
hereunder may not be sold, transferred, assigned, pledged, encumbered, or
hypothecated by him, except as otherwise expressly permitted by the provisions
of this Agreement. This Agreement shall inure to the benefit of and be
enforceable by Executive and his personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.
(k) Actuarially Equivalent Value Calculation. For the purpose of
determining an actuarially equivalent value under the terms of this Agreement,
the interest rate specified in Section 417(e) (3) of the Internal Revenue Code
of 1986, or any successor section thereto, as of the date of such determination,
and the 1994 Group Annuitants Mortality Table, shall be used and for purposes of
determining present value under the terms of this Agreement, the interest rate
specified immediately above shall be used. All calculations shall be made at the
expense of the Company, by the independent auditors of the Company. As soon as
practicable after the need for such calculation arises, the Company shall
provide to its auditors all information needed to perform such calculations.
(l) Construction of Agreement. Executive has been appointed as Chairman
of the Board and Chief Executive Officer of the Company in replacement of
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ("Tanaka"), who is a party to an Employment Agreement dated as of
March 4, 2001 (the "Tanaka Employment Agreement"). Notwithstanding anything to
the contrary set forth herein, this Agreement shall be construed and interpreted
so as to provide Executive with the same rights, obligations and benefits as
were available to Tanaka pursuant to the Tanaka Employment Agreement, including
any modifications and limitations of those rights, obligations and benefits that
may have resulted from (i) the filing by the Company of a voluntary petition for
relief under Chapter 11 of the Bankruptcy Code on March 6, 2002, and (ii) the
adoption by the Company of the Chapter 11 Retention Program which was approved
by the Bankruptcy Court on May 28, 2002 (the "Retention Program"); provided,
however, that pursuant to paragraph 4 of the section
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of the Retention Program which is entitled "Retention and Emergence Incentive
Compensation Program," the amounts set forth in the table shall be as follows
for Executive:
------------------------------------------------------------------------
4 months 10 months 16 months 22 months At Total
07/06/02 01/06/03 07/06/03 01/06/04 Emergence Payment
------------------------------------------------------------------------
0.0% 6.45% 11.75% 11.75% 47% 76.95%
------------------------------------------------------------------------
Under no circumstances shall any claim by Executive pursuant to this Agreement
be considered an administrative claim, except to the extent that the same claim
by Tanaka pursuant to the Tanaka Employment Agreement would have been considered
an administrative claim.
IN WITNESS WHEREOF, Executive has hereunto set his hand and the Company
has caused this instrument to be duly executed as of the day and year first
above written.
NATIONAL STEEL CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------------
Title: Senior Vice President, General Counsel
---------------------------------------
and Secretary
-------------
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇
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