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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): MAY 20, 1999
SOUTHDOWN, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
LOUISIANA 1-6117 72-0296500
(STATE OR OTHER JURISDICTION OF (COMMISSION (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) FILE NUMBER) IDENTIFICATION NO.)
1200 SMITH STREET
SUITE 2400
HOUSTON, TEXAS 77002
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (713) 650-6200
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ITEM 5. OTHER EVENTS
On May 20, 1999, the Company held its 1999 Annual Meeting of
Shareholders. At the Annual Meeting, shareholders approved proposals to (1)
elect three directors as members of Class II, one director as a member of Class
III, and one director as a member of Class I to the Company's Board of
Directors to serve until the 2002, 2000 and 2001 Annual Meetings of
Shareholders, respectively, and until their successors are duly elected and
have qualified; (2) amend the Company's 1991 Nonqualified Stock Option Plan for
Non-Employee Directors; and (3) appoint Deloitte & Touche LLP as the
independent auditors of the books and accounts of the Company for the year
ending December 31, 1999.
The votes of the shareholders of the Company on these proposals were
as follows:
(1) With respect to the election of the following persons to the
Board of Directors of the Company to serve until the Annual
Meeting of Shareholders to be held in 2002, 2000 and 2001,
respectively, and until their successors have been elected and
qualified:
<TABLE>
<CAPTION>
Nominee For Withheld
------- --- --------
<S> <C> <C>
Class II Directors:
Frank J. Ryan 28,017,816 108,448
Whitson Sadler 28,016,783 101,481
J. Bruce Tompkins 28,011,464 115,814
Class III Director:
George E. Uding, Jr. 27,993,640 132,703
Class I Director:
Robert S. Evans 28,005,965 120,299
</TABLE>
(2) With respect to the approval of the amendment to the 1991
Nonqualified Stock Option Plan for Non-Employee Directors:
<TABLE>
<CAPTION>
For Against Abstain
--- ------- -------
<S> <C> <C>
26,632,366 1,331,638 162,258
</TABLE>
(3) With respect to the approval of the appointment of Deloitte &
Touche LLP as independent auditors of the books and accounts of
the Company for the year ending December 31, 1999:
<TABLE>
<CAPTION>
For Against Abstain
--- ------- -------
<S> <C> <C>
28,035,204 41,057 50,003
</TABLE>
<PAGE> 3
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Exhibits - The following documents are filed as exhibits to this
Current Report:
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
------ ----------------------
<S> <C>
99.1 1999 Phantom Stock Plan for Non-Employee Directors -
incorporated by reference from Exhibit 99.1 to the
Company's Registration Statement on Form S-8
(Registration No. 333-78887) dated May 20, 1999.
99.2 1991 Non-qualified Stock Option Plan for Non-Employee
Directors, as amended incorporated by reference from
Exhibit 99.1 to the Company's Statement on Form S-8
(Registration No. 333-78955) dated May 20, 1999.
*99.3 Phantom Stock and Deferred Compensation Plan for
Non-Employee Directors, as amended March 25, 1999.
*99.4 Directors' Retirement Plan, as amended March 25, 1999.
*99.5 1999 Restricted Stock Grants Plan and Form of Restricted
Stock Agreement.
--------------
* Filed herewith.
</TABLE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
SOUTHDOWN, INC.
-------------------------------------------------------
(Registrant)
Date: June 1, 1999 By:
---------------------------------------------------
Patrick S. Bullard
Sr. Vice President - General Counsel and Secretary
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
------ ----------------------
<S> <C>
99.1 1999 Phantom Stock Plan for Non-Employee Directors -
incorporated by reference from Exhibit 99.1 to the
Company's Registration Statement on Form S-8
(Registration No. 333-78887) dated May 20, 1999.
99.2 1991 Non-qualified Stock Option Plan for Non-Employee
Directors, as amended incorporated by reference from
Exhibit 99.1 to the Company's Statement on Form S-8
(Registration No. 333-78955) dated May 20, 1999.
*99.3 Phantom Stock and Deferred Compensation Plan for
Non-Employee Directors, as amended March 25, 1999.
*99.4 Directors' Retirement Plan, as amended March 25, 1999.
*99.5 1999 Restricted Stock Grants Plan and Form of Restricted
Stock Agreement.
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* Filed herewith.
</TABLE>
<PAGE> 1
EXHIBIT 99.3
AMENDMENT TO FREEZE THE
SOUTHDOWN, INC.
PHANTOM STOCK AND DEFERRED COMPENSATION PLAN
FOR NON-EMPLOYEE DIRECTORS
W I T N E S S E T H:
WHEREAS, Southdown, Inc. (the "Company") presently maintains the
Southdown, Inc. Phantom Stock and Deferred Compensation Plan for Non-Employee
Directors (the "Plan") which became effective on January 1, 1997; and
WHEREAS, the Company, pursuant to Section 6.4 of the Plan, has the right
to amend the Plan, from time to time, subject to certain limitations.
NOW, THEREFORE, in order to make various revisions desired by the Company,
and subject to paragraph 3 below, the Plan is hereby amended in the following
manner:
1. Section 4.1 of the Plan is hereby amended by adding the following
sentence:
Notwithstanding the foregoing, no Stock Units will be awarded to a
Participant in accordance with this Section 4.1 after the Annual Meeting
of the Shareholders of the Company in 1999 ("1999 Annual Meeting").
2. Section 4.2(d) of the Plan is hereby added in its entirety to read as
follows:
(d) Notwithstanding the foregoing, no Stock Units will be awarded to
a Participant in accordance with this Section 4.2 after the 1999 Annual
Meeting.
3. This Amendment shall be effective upon the date of its adoption by the
Board of Directors of the Company (the "Board"), provided that if the March 25,
1999 Amendment to the Southdown, Inc. 1991 Nonqualified Stock Option Plan for
Non-Employee Directors is not approved by of the shareholders of the Company at
the Annual Meeting of the Shareholders of the Company in 1999 as provided in
paragraph 3 thereof, this Amendment shall be null and void and have no effect.
4. This Amendment to the Plan was approved by the Board on March 25, 1999.
Except as provided herein, the Plan remains unchanged and in full force and
effect.
Approved: Date:
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ANNEX 1
SOUTHDOWN, INC.
PHANTOM STOCK AND
DEFERRED COMPENSATION PLAN
FOR NON-EMPLOYEE DIRECTORS
SECTION I.
PURPOSES OF PLAN, EFFECTIVE DATE AND DEFINITIONS
1.1 Purpose. The purpose of the Southdown, Inc. Phantom Stock and
Deferred Compensation Plan for Non-Employee Directors ("Plan") is to attract
and retain the services of experienced and knowledgeable non-employee directors
and provide an opportunity for ownership of the common stock, $1.25 par value
("Common Stock") of Southdown Inc., a Louisiana corporation ("Company"). The
Plan shall be an unfunded deferred compensation arrangement.
1.2 Effective Date. The Plan shall be effective as of the 1st day of
January, 1997 ("Effective Date") provided the Plan is approved by the
stockholders of the Company within twelve (12) months of the date the Plan is
approved by the Board. Notwithstanding any provision of the Plan, a Participant
will not be entitled to a distribution of Common Stock pursuant to Section V
prior to the approval of the Plan by the stockholders of the Company.
1.3 Definitions. For purposes of this Plan, the following phrases or
terms shall have the indicated meanings unless otherwise clearly apparent from
the context.
(a) "Beneficiary" means any person or persons so designated
in accordance with the provisions of Section 5.3.
(b) "Board" means the Board of Directors of the Company.
(c) "Compensation" means the sum of (i) the monthly fee a
Participant earns for services rendered as a Board member and (ii) the monthly
fee a Participant earns for services rendered on each committee of the Board on
which a Participant serves.
(d) "Fair Market Value" means the average (mean) of the
reported "high" and "low" sales prices for a share of Common Stock as reported
in The Wall Street Journal's NYSE-Composite Transactions listing for such day
(corrected for obvious typographical errors), or if shares of Common Stock are
not reported in such listing, the average of the reported "high" and "low"
sales prices on the largest national securities exchange (based on the
aggregate dollar value of securities listed) on which such shares are listed or
traded, or if such shares are not listed or traded on any national securities
exchange, then the average of the reported "high" and "low" sales prices for
such shares in the over-the-counter market, as reported on the National
Association of Securities Dealers Automated Quotations System, or, if such
prices shall not be reported thereon, the average between the closing bid and
asked prices so reported, or, if such prices shall not be reported, then the
average
<PAGE> 3
closing bid and asked prices reported by the national Quotation Bureau
Incorporated, or, in all other cases, the value established by the Board in
good faith.
(e) "Last Trading Day" means the last day of each calendar
month on which shares of Common Stock are traded on the New York Stock
Exchange. The first Last Trading Day shall be January 31, 1997.
(f) "Participant" means each non-employee member of the
Board.
(g) "Plan Year" means the twelve month period commencing on
January 1st and ending December 31st.
(h) "Stock Unit" means a right to receive one share of Common
Stock.
SECTION II.
ADMINISTRATION OF THE PLAN
The Plan shall be administered by the Board. Subject to the terms of
the Plan, the Board shall have the power to interpret the provisions and
supervise the administration of the Plan. All decisions made by the Board
pursuant to the provisions of the Plan shall be made by a majority of its
members at a duly held regular or special meeting or by written consent in lieu
of any such meeting. A majority of the Directors in office shall constitute a
quorum and all decisions made by the Board pursuant to provisions of the Plan
shall be made by a majority of directors present at any duly held regular or
special meeting at which a quorum is present (unless the concurrence of a
greater proportion is required by law or by the articles or bylaws of the
Company) or by the written consent of a majority of the directors in lieu of
any such meeting.
SECTION III.
COMMON STOCK RESERVED FOR THE PLAN
3.1 Reserved. The aggregate number of shares of Common Stock that may
be issued under the Plan shall not exceed 250,000. The Company shall at all
times reserve a sufficient number of shares of Common Stock to satisfy the
requirements of the Plan.
3.2 Common Stock Offered. The Common Stock to be delivered pursuant to
the Plan may be authorized but unissued Common Stock or Common Stock previously
issued and outstanding and reacquired by the Company.
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3.3 Adjustment in Capitalization. In the event of any change in the
outstanding shares of Common Stock that occurs after the Effective Date by
reason of a Common Stock dividend or split, recapitalization, merger,
consolidation, combination, exchange of shares or other similar corporate
change, the aggregate number of shares of Common Stock subject to a Stock Unit
shall be adjusted appropriately by the Board whose determination shall be
conclusive.
SECTION IV.
STOCK UNITS
4.1 Award of Stock Units. Effective as of each Last Trading Day, the
Participant will be awarded a number of Stock Units in accordance with the
following formula:
One-half of a Participant's Compensation
Stock Units Awarded = divided by the Fair Market Value of a share of
Common Stock on the Last Trading Day of the
month in which the Compensation is earned
Fractional amounts shall be rounded to the nearest ten thousandth
share. The Company shall maintain an account ("Account") for each Participant
which will reflect the current number of Stock Units maintained on behalf of a
Participant at any time. The Stock Units awarded a Participant pursuant to this
Section 4.1 are in lieu of and replace one-half of the amount of cash
Compensation a Participant would have received prior to the Effective Date.
4.2 Deferred Compensation - Stock Units.
(a) Any Participant may irrevocably elect, prior to the
beginning of each Plan Year, but no later than the November 30 preceding the
beginning of a Plan Year, to defer receipt of one-half of the amount of
Compensation a Participant is to earn during the Plan Year which would
otherwise have been payable in cash to the Participant. A new Participant may
make an election with respect to one-half of the amount of Compensation such
Participant will earn during such Participant's first Plan Year of eligibility
within 30 days of becoming a Participant.
(b) The election will be made on a written form called a
"Notice of Election", which shall be signed by the Participant and delivered to
the Board. This election will continue in effect for future years in which the
Participant is eligible to participate unless the Participant submits a written
request revoking or revising his or her election on a new Notice of Election
form. Any revocation or revised election will be applicable only to one-half
the amount of Compensation the Participant may earn in the future and will be
effective as of the first day of the Plan Year specified in such revocation or
revised election, provided that the new, signed Notice of Election form has
been received by the Board by November 30 immediately preceding such specified
Plan Year.
(c) If a Participant has elected to defer receipt of one-half
of the amount of Compensation as set forth in paragraph (a) above, then the
one-half of Compensation deferred will
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<PAGE> 5
be converted into Stock Units and added to a Participant's Account effective as
of each Last Trading Day in accordance with the following formula:
One-half of a Participant's Compensation
Stock Units Awarded = divided by the Fair Market Value of a share of
Common Stock on the Last Trading Day of the
month in which the Compensation is earned
Fractional amounts shall be rounded to the nearest ten thousandth
share.
4.3 Dividend - Stock Units.
Upon the payment of any cash dividend by the Company to holders of
Common Stock, a Participant will be awarded a number of Stock Units to be added
to such Participant's Account in an amount equal to the product of (i) the
number of Stock Units held in a Participant's Account on the date the cash
dividend was declared (rounded down to the nearest whole share), multiplied by
(ii) a fraction, where the numerator is the amount of cash dividend paid on one
share of Common Stock and the denominator is the Fair Market Value of a share
of Common Stock on the date the cash dividend was paid by the Company to the
holders of Common Stock.
SECTION V.
DISTRIBUTION OF BENEFITS
5.1 Cessation from Board. Within ten (10) days from the date a
Participant ceases to serve on the Board for any reason, the Company shall
deliver a certificate or certificates to such Participant for a number of
shares of Common Stock equal to the total number of Stock Units (rounded up to
the nearest whole Stock Unit) in such Participant's Account as of the date the
Participant's service on the Board ceased.
5.2 Termination of the Plan. If the Plan is terminated pursuant to
Section 6.4, within ten (10) days from the date of such termination of the Plan
("Plan Termination Date"), the Company shall deliver a certificate or
certificates to each Participant for a number of shares of Common Stock equal
to the total number of Stock Units (rounded up to the nearest whole Stock Unit)
in a Participant's Account as of the Plan Termination Date.
5.3 Beneficiary. In the event of the death of a Participant before
delivery of a certificate or certificates of Common Stock pursuant to Sections
5.1 or 5.2 above, the Company shall deliver the shares of Common Stock to the
individual designated as Primary Beneficiary on the latest executed "Notice of
Change of Beneficiary" form on file with the Company within a reasonable time
period, but no later than 180 days after the date of death of the Participant.
If the Primary Beneficiary designated on the latest executed "Notice of Change
of Beneficiary" form is no longer living, the Company shall deliver the shares
of Common Stock to the individual designated as Secondary Beneficiary on the
latest executed "Notice of Change of Beneficiary" form on file with
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<PAGE> 6
the Company. If the Second Beneficiary designated on the latest executed
"Notice of Change of Beneficiary" form is no longer living, the Company shall
deliver the shares of Common Stock to the Participant's estate. If a
Participant desires to change the Beneficiary he or she has previously
designated, the Participant may do so at any time by submitting a new "Notice
of Change of Beneficiary" form to the Board of Directors.
SECTION VI.
MISCELLANEOUS
6.1 Benefits Payable from General Assets. Amounts payable hereunder
shall be paid exclusively from the general assets of the Company, and no person
entitled to payment hereunder shall have any claim, right, security interest,
or other interest in any fund, trust, account, insurance contract, or asset of
the Company which may be looked to for such payment. The Company's liability
for the payment of benefits hereunder shall be evidenced only by this Plan. A
Participant shall have only the right of a general unsecured creditor of the
Company with respect to any rights under the Plan. Nothing contained in the
Plan shall constitute a guaranty by the Company or any other entity or person
that the assets of the Company will be sufficient to pay any benefit hereunder.
6.2 Nonalienation of Benefits. No right or benefit under this Plan
shall be subject to anticipation, alienation, sale, assignment, pledge,
encumbrance or charge, and any attempt to anticipate, alienate, sell, assign,
pledge, encumber or charge the same will be void. No right or benefit hereunder
shall in any manner be liable for or subject to any debts, contracts,
liabilities or torts of the person entitled to such benefits. If any
Participant or Beneficiary hereunder shall become bankrupt or attempt to
anticipate, alienate, assign, sell, pledge, encumber or charge any right of
benefit hereunder, or if any creditor shall attempt to subject the same to a
writ of garnishment, attachment, execution, sequestration or any other form of
process or involuntary lien or seizure, then such right or benefit shall be
held by the Company for the sole benefit of the Participant or the Beneficiary,
his or her spouse, children or other dependents, or any of them in such manner
and in such proportion as the Board shall deem proper, free and clear of the
claims of any other party whatsoever.
6.3 Prerequisites to Benefits. No Participant, or any person claiming
through a Participant, shall have any right or interest in the Plan or any
benefits hereunder unless and until all the terms, conditions and provisions of
the Plan that affect such Participant or such other person shall have been
complied with as specified herein. The Participant shall complete such forms
and furnish such information as the Board may require in the administration of
the Plan.
6.4 Amendment or Termination of the Plan. The Board may amend or
terminate this Plan at any time. Any amendment or termination of this Plan
shall not, however, affect the rights of any Participant to the benefits
provided under Stock Units then standing to the credit of any such Participant
in the Participant's Account at the time of such amendment or termination. The
Board may not, without approval of the stockholders of the Company, amend the
Plan to increase the
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aggregate number of shares of Common Stock reserved for the Plan, except as
provided in Section 3.3.
6.5 Governing Law. The Plan is established under, and the execution,
validity, interpretation and performance of this Plan shall be determined and
governed exclusively by, the laws of the State of Texas, without reference to
the principles of conflict of laws. Exclusive jurisdiction with respect to any
legal proceeding brought by a Participant, or any party representing
Participant or claiming to have an interest in Participant's benefits under the
Plan, shall be settled by arbitration in accordance with the Commercial
Arbitration Rules of the American Arbitration Association, and judgment upon
the award rendered by the arbitrator may be entered in any court having
jurisdiction. In reaching his or her decision, the arbitrator shall have no
authority to change or modify any provision of this Plan. In addition, any and
all charges which may be made for the cost of the arbitration and the fees and
expenses of the arbitrator shall be borne equally by the parties. Jurisdiction
with respect to any legal proceeding brought by Company, concerning any subject
matter contained in this Plan shall rest in state or federal courts sitting in
the State of Texas or in any jurisdiction where Participant resides, does or
has done business, or owns property. Also, Company, at its election, may submit
any dispute it has with Participant or claiming party to arbitration in
accordance with the procedures set forth in this Section.
6.6 Severability. All provisions herein are severable and in the event
any one of them shall be held invalid by any court of competent jurisdiction,
the Plan shall be interpreted as if such invalid provisions was not contained
herein.
6.7 Headings. The headings of the sections of this Plan are inserted
for convenience only and shall not be deemed to constitute a part of this Plan.
6.8 Non-Waiver. Failure on the part of any party in any one or more
instances to enforce any of its rights which arise in connection with this Plan
or to insist upon the strict performance of any of its terms, conditions, or
covenants of this Plan shall not be construed as a waiver or a relinquishment
for the future of any such rights, terms, conditions, or covenants. No waiver
of any condition of this Plan shall be valid unless it is in writing.
6.9 Plan on File. The Company shall place this Plan on file in the
office of its principal place of business.
6.10 Notices. Any notices to be given hereunder by either party to the
other may be effected either by personal delivery in writing or by mail,
registered or certified, postage prepaid with return receipt requested. Notices
delivered personally shall be deemed communicated as of actual receipt; mailed
notices shall be deemed communicated as of three (3) days after mailing.
Approved: Date:
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EXHIBIT 99.4
AMENDMENT TO FREEZE THE
SOUTHDOWN, INC.
DIRECTORS' RETIREMENT PLAN
W I T N E S S E T H:
WHEREAS, the Southdown, Inc. (the "Company") presently maintains the
Southdown, Inc. Directors' Retirement Plan (the "Plan") which became effective
on February 14, 1995; and
WHEREAS, the Company, pursuant to Section 5.1 of the Plan, has the right
to amend the Plan, from time to time, subject to certain limitations.
NOW, THEREFORE, in order to make various revisions desired by the Company,
and subject to paragraph 8 below, the Plan is hereby amended in the following
manner:
1. Section 1.3 of the Plan is hereby amended in its entirety to read as
follows:
1.3 "Months of Service" means, all purposes other than the determination of
whether a Participant is entitled to a Plan Benefit under Section 9.1, the
Participant's aggregate number (or any lesser number if the context clearly
indicates such) of full months of service on the Company's Board of Directors
immediately prior to the Effective Date. For purposes of determining whether a
Participant is entitled to a Plan Benefit under Section 9.1, service after the
Effective Date shall be included.
2. Section 1.12 of the Plan is hereby added in its entirety to read as
follows:
1.12 "Effective Date" means March 25, 1999.
3. Section 2.1 of the Plan is hereby amended in its entirety to read as
follows:
2.1 Eligibility to Participate. A member of the Company's Board of Directors is
eligible to become a Participant in the Plan, provided such member (i) either
(a) has accumulated sixty (60) Months of Service by the Effective Date or (b)
is a member of the Company's Board of Directors immediately prior to the
Effective Date, (ii) has not been removed from the Company's Board of Directors
for cause as permitted by applicable law, and (iii) is not a participant in,
eligible to participate in, nor entitled to benefits from, a Qualified
Retirement Plan.
4. Section 4.1 of the Plan is hereby amended in its entirety to read as
follows:
4.1 Amount of Benefit. Plan Benefits payable to a Participant pursuant to
Paragraph 3.1 will be paid in an amount equal to sixty-six and two-thirds
percent (66%) of the per month average of the combined board and committee fees
received by such Participant during the last twelve consecutive Months of
Service (or, if a Participant has been a director for a period of less than
<PAGE> 2
twelve consecutive months, the consecutive Months of Service during such
shorter period) immediately prior to the Effective Date. For purposes of this
Paragraph, the term "combined board and committee fees earned by such
Participant" includes any Board and committee fees received in cash or any
Board and committee fees converted into Stock Units pursuant to Sections 4.1
and 4.2 of the Southdown, Inc. Phantom Stock and Deferred Compensation Plan for
Non-Employee Directors.
5. Section 7.1 of the Plan is amended to read in its entirety as follows:
7.1 Change in Control. In the event of a change in control of the Company, as
such term is defined in the Company's 1989 Stock Option Plan, notwithstanding
the provisions of Section 9.1, a Participant shall be entitled to receive a
Plan Benefit.
6. Section 8.1 of the Plan is hereby added in its entirety to read as
follows:
8.1 Frozen Plan. Immediately after the Effective Date, (i) no member of the
Company's Board of Directors who is not a Participant shall become a
Participant and (ii) no Participant shall earn or accrue any further benefits
under the Plan. Any benefits earned or accrued prior to the Effective Date
shall be distributed in accordance with the Plan.
7. Section 9.1 of the Plan is hereby added in its entirety to read as
follows:
9.1 Vested Plan Benefit. Except as provided in Section 7.1, no Participant
under the Plan shall have the right to any Plan Benefit unless a Participant
has accumulated sixty (60) Months of Service.
8. This Amendment shall be effective upon the date of its adoption by the
Company's Board of Directors ("Board"), provided that if the March 25, 1999
Amendment to the Southdown, Inc. 1991 Nonqualified Stock Option Plan for
Non-Employee Directors is not approved by the shareholders of the Company at
the Annual Meeting of the Shareholders of the Company in 1999, this Amendment
shall be null and void and have no effect.
9. This Amendment to the Plan was approved by the Board on March 25, 1999.
Except as provided herein, the Plan remains unchanged and in full force and
effect.
Approved: Date:
--------------------------------- ----------------------------
2
<PAGE> 3
FIRST AMENDMENT TO THE
SOUTHDOWN, INC. DIRECTORS' RETIREMENT PLAN
W I T N E S S E T H:
WHEREAS, Southdown, Inc. (the "Company") maintains the Southdown, Inc.
Directors' Retirement Plan (the "Plan"); and
WHEREAS, the Company, pursuant to Section 5.1 of the Plan, has the right
to amend the Plan from time to time subject to certain limitations.
NOW, THEREFORE, in order to make certain revisions desired by the Company,
the Plan is hereby amended in the following manner effective as of January 1,
1997:
1. Section 4.1 is hereby amended in its entirety to read as follows:
4.1 Amount of Benefit. Plan Benefits payable to a Participant
pursuant to Paragraph 3.1 will be paid in an amount equal to sixty-six and
two-thirds percent (66 2/3%) of the per month average of the combined
board and committee fees earned by such Participant during the last twelve
consecutive Months of Service. For purposes of this Paragraph, the term
"combined board and committee fees earned by such Participant" includes
any board and committee fees received in cash or any board and committee
fees converted into Stock Units pursuant to Sections 4.1 and 4.2 of the
Southdown, Inc. Phantom Stock and Deferred Compensation Plan for
Non-Employee Directors.
Approved:
--------------------------------
Date:
------------------------------------
<PAGE> 4
SOUTHDOWN, INC. DIRECTORS' RETIREMENT PLAN
Southdown, Inc. has adopted the Southdown, Inc. Directors' Retirement
Plan, effective February 14, 1995, for the members of its Board of Directors to
ensure that the overall effectiveness of the Company's compensation program for
directors will attract, retain and motivate qualified directors.
1. Definitions. When used herein, the following words shall have the meanings
below unless the context clearly indicates otherwise:
1.1 "Committee" means the Southdown, Inc. Employee Benefits Committee as
appointed by the Board of Directors to administer the Qualified
Retirement Plans.
1.2 "Company" means Southdown, Inc., a Louisiana corporation, and any
successor thereto.
1.3 "Months of Service" means the Participant's aggregate number (or any
lesser number if the context clearly indicates such) of full months
of service on the Company's Board of Directors immediately prior to
such Participant's termination of service on the Board of Directors.
1.4 "Participant" means any member of the Company's Board of Directors
who meets the eligibility requirements of Paragraph 2.1.
1.5 "Plan" means the Southdown, Inc. Directors' Retirement Plan.
1.6 "Plan Benefit" means the monthly benefit payable in accordance with
the Plan.
1.7 "President" means the President of the Company.
1.8 "Qualified Retirement Plan" means the Southdown, Inc. Pension Plan or
the Southdown, Inc. Retirement Savings Plan as each may be amended
from time to time or any successor thereto.
1.9 "Recipient" means a Participant or a surviving Spouse receiving or
entitled to receive a Plan Benefit.
1.10 "Retirement Date" means the first of the month immediately following
a Participant's attainment of age 65 or the Participant's termination
of service on the Company's Board of Directors, whichever is later.
1.11 "Spouse" means the Participant's lawful spouse as of the date of the
Participant's death.
2.1 Eligibility to Participate. A member of the Company's Board of Directors is
eligible to become a Participant in the Plan; provided such member (i) has
accumulated sixty (60) Months of Service, (ii) has not been removed from the
Company's Board of Directors for cause as permitted by applicable law, and
(iii) is not a participant in, eligible to participate in, nor entitled to
benefits from, a Qualified Retirement Plan.
2.2 Term of Participation. Once a member becomes a Participant, he shall remain
a Participant until the final and complete payment of all Plan Benefits to which
such Participant is entitled under the Plan.
3.1 Eligibility for Benefits. Each Participant is eligible to retire from the
Company and receive a Plan Benefit under the Plan beginning on the
Participant's Retirement Date.
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<PAGE> 5
3.2 Term of Benefit Payments. Plan Benefits payable to a Participant pursuant
to Paragraph 4.1, or to a surviving Spouse pursuant to Paragraph 4.2, shall be
paid, until the earlier of (i) the date of the last to occur of the
Participant's death or the surviving Spouse's death, or (ii) the date on which
the aggregate number of monthly payments made to the Participant and surviving
Spouse equals the Participant's Months of Service.
3.3 Death Benefits. If a married Participant dies prior to age 65, such benefit
due hereunder shall be payable to the Spouse in accordance with Paragraph 4.2
for the term specified in Paragraph 3.2 commencing on the Participant's
Retirement Date assuming the Participant had:
(i) separated from service on the Board on the earlier of the actual date
of separation or the date of death,
(ii) survived to age 65,
(iii) retired with an immediate joint and survivor annuity based on
Participant's Plan Benefit on date of death, and
(iv) died on the day after the day on which the Participant would have
attained age 65.
If a married Participant dies after age 65, but prior to his or her
Retirement Date, such benefit due hereunder shall be payable to the Spouse in
accordance with Paragraph 4.2 for the term specified in Paragraph 3.2
commencing on the Participant's Retirement Date assuming the Participant had
retired with an immediate joint and survivor annuity on the day before the
Participant's date of death.
4.1 Amount of Benefit. Plan Benefits payable to a Participant pursuant to
Paragraph 3.1 will be paid in an amount equal to sixty-six and two-thirds
percent (66 2/3%) of the per month average of the combined board and committee
fees received by such Participant during the last twelve consecutive Months of
Service.
4.2 Form and Manner of Payment. The Plan Benefit payable pursuant to Paragraph
4.1 shall be in the form of a joint and survivor annuity. Such joint and
survivor annuity following the Participant's death shall be payable to the
Spouse at a rate equal to 50% of the rate at which benefits were payable to the
Participant. Plan Benefits shall be paid by a check mailed directly to
Recipient or a electronic funds transfer, as Recipient shall direct, in
accordance with the normal payment cycle of the Company for making supplemental
pension payments, and shall be subject to all statutory tax withholdings.
5.1 Plan Amendments and Termination. The Company intends the Plan to be
permanent but reserves the right to amend or terminate the Plan when, in the
sole opinion of the Company, such amendment or termination is advisable. Any
such amendment or termination shall be made pursuant to a resolution of the
Board of Directors of the Company and shall be effective as of the date of such
resolution. No amendment or termination of the Plan shall directly or
indirectly deprive any Participant of any Plan Benefit, or the right to a Plan
Benefit, which has been earned prior to the effective date of the resolution
amending or terminating the Plan.
5.2 Benefits on Plan Termination. In the case of a Plan termination, each
Participant's Plan Benefit shall be calculated and payable as set forth herein
based on the Participant's Months of Service immediately prior to the effective
date of such Plan termination.
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<PAGE> 6
5.3 Sale or Merger. The Plan shall not be automatically terminated by a
transfer or sale of assets of the Company or by the merger or consolidation of
the Company into or with any other corporation or other entity, but the Plan
shall be continued after such sale, merger or consolidation only if and to the
extent that the transferee, purchaser or successor entity agrees to continue
the Plan. In the event the Plan is not continued by the transferee, purchaser
or successor entity, then the Plan shall terminate subject to the provisions of
Paragraphs 5.1 and 5.2.
6.1 No Effect on Rights. Nothing contained herein will confer upon any
Participant the right to be retained in the service of the Company nor limit
the right of the Company to discharge or otherwise deal with Participants
without regard to the existence of the Plan.
6.2 Funding. The Plan at all times shall be entirely unfunded and no provision
shall at any time be made with respect to segregating any assets of the Company
for payment of any benefits hereunder. No Participant shall have any interest
in any particular assets of the Company by reason of the right to receive a
benefit under the Plan and any such Participant shall have only the rights of a
general unsecured creditor of the Company with respect to any rights under the
Plan. Nothing contained in the Plan shall constitute a guaranty by the Company
or any other entity or person that the assets of the Company will be sufficient
to pay any benefit hereunder.
6.3 Spendthrift Provision. No benefit payable under the Plan shall be subject
in any manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, or charge prior to actual receipt thereof by the payee; and any
attempt so to anticipate, alienate, sell, transfer, assign, pledge, encumber or
charge prior to such receipt shall be void; and the Company shall not be liable
in any manner for or subject to the debts, contracts, liabilities, engagements
or torts of any person entitled to any benefit under the Plan.
6.4 Administration. The Committee shall be responsible for the general
operation and administration of the Plan and for carrying out the provisions
thereof. It has all powers necessary to accomplish that purpose, including, but
not by way of limitation, the following:
a. To adopt and issue rules and regulations necessary for the proper
conduct and administration of the Plan, and to change, alter, or amend
such rules and regulations;
b. To construe and enforce the Plan in accordance with its terms and any
rules and regulations it establishes; and
c. To resolve all questions arising in the administration of the Plan,
including those relating to eligibility, participation under the Plan, and
the rights of Participants and surviving Spouses. The Committee's
decisions thereon shall be final and binding upon all persons.
6.5 Disclosure. Each Participant shall receive a copy of the Plan and the
Committee will make available for inspection by any Participant a copy of the
rules and regulations used by the Committee in administering the Plan.
6.6 State Law. The Plan is established under, and the execution, validity,
interpretation and performance of this Plan shall be determined and governed
exclusively by, the laws of the State of Texas, without reference to the
principles of conflict of laws. Exclusive jurisdiction with respect to any
legal proceeding brought by a Participant, or any party representing
Participant or claiming to have an interest in Participant's Plan Benefit
("claiming party"), shall be settled by arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association, and
judgment upon the award rendered by the arbitrator may be entered in any court
having jurisdiction.
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<PAGE> 7
In reaching his or her decision, the arbitrator shall have no authority to
change or modify any provision of this Plan. In addition, any and all charges
which may be made for the cost of the arbitration and the fees and expenses of
the arbitrator shall be borne equally by the parties. Jurisdiction, with
respect to any legal proceeding brought by Company concerning any subject
matter contained in this Plan, shall rest in state or federal courts sitting in
the State of Texas or in any jurisdiction where Participant resides, does or
has done business, or owns property. Also, Company, at its election, may submit
any dispute it has with Participant or claiming party to arbitration in
accordance with the procedures set forth in this Paragraph.
6.7 Incapacity of Recipient. In the event a Recipient is declared incompetent
and a conservator or other person legally charged with the care of his person
or of his estate is appointed, any benefits under the Plan to which such
Recipient is entitled shall be paid to such conservator or other person legally
charged with the care of his or her person or estate. Except as provided above
in this paragraph, when the Committee in its sole discretion, determines that a
Recipient is unable to manage his or her financial affairs, the Committee may
direct the Company to make distributions to any person for the benefit of such
Recipient.
6.8 Unclaimed Benefit. Each Recipient shall keep the Committee informed of his
or her current address. The Committee shall not be obligated to search for the
whereabouts of any person. If the location of a Recipient is not made known to
the Committee within two (2) years after the date on which any payment of the
Recipient's Plan Benefit may be made, then the Company shall have no further
obligation to pay any benefit hereunder to such Recipient and such benefits
shall be irrevocably forfeited.
6.9 Limitations on Liability. Notwithstanding any of the preceding provisions
of the Plan, neither the Company nor any individual acting as an employee or
agent of the Company or as a member of the Committee shall be liable to any
Participant, former Participant, Spouse, Recipient, or any other person for any
claim, loss, liability or expense incurred in connection with the Plan.
7.1 Change in Control. In the event of a change in control of the Company, as
such term is defined in the Company's 1989 Stock Plan, the following shall be
substituted for Paragraph 2.1, but only with respect to members then serving on
the Company's Board of Directors:
A member of the Company's Board of Directors is eligible to become a
Participant in the Plan; provided such member (i) has not been removed
from the Company's Board of Directors for cause as permitted by applicable
law, and (ii) is not a participant in, eligible to participate in, nor
entitled to benefits from, a Qualified Retirement Plan.
Approved: /s/ Edgar J. Marston III Date: March 23, 1995
--------------------------- -----------------------------
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<PAGE> 1
EXHIBIT 99.5
SOUTHDOWN, INC.
1999 RESTRICTED STOCK GRANTS PLAN
The Board of Directors of Southdown, Inc. (the "Company") is in January
1999 awarding performance bonuses payable in the form of treasury shares of
common stock of the Company to certain members of senior management of the
Company. All such awards are under this 1999 Restricted Stock Grants Plan (the
"Plan") and no other shares shall be issued under this Plan. All such awards
will be made pursuant to Restricted Stock Agreements in substantially the form
attached to this Plan. The terms and conditions of this Plan will be
interpreted by the Board of Directors.
<PAGE> 2
SOUTHDOWN, INC.
RESTRICTED STOCK AGREEMENT
This Restricted Stock Agreement ("Agreement"), entered into on the ____th
day of ______, 1999, but effective for all purposes as of January 21, 1999 (the
"Effective Date"), the date on which the Grant described below was approved by
the Board of Directors of Southdown, Inc., is between Southdown, Inc., a
Louisiana corporation (the "Company"), and ____________________, (the
"Employee").
WHEREAS, to provide motivation to the Employee to continue to exert
Employee's best efforts for the success and welfare of the Company and for the
benefit of the Company's stockholders, the Company and Employee agree as
follows:
1. Award of Common Stock. The Company hereby grants (the "Grant") to
Employee ___________ shares (the "Shares") of common stock, $1.25 par value, of
the Company ("Common Stock") which shall be subject to the restrictions on
transferability set forth in Section 2(d) herein (the "Restrictions") and to the
other provisions of this agreement.
2. Restricted Period.
(a) For a period of three (3) years commencing on the Effective Date
(the "Restricted Period"), the Shares shall be subject to the Restrictions and
any other restrictions as set forth herein. The Restrictions shall expire as to
all of the Shares on January 21, 2002, the third anniversary of the Effective
Date. The Shares which are subject to the Restrictions shall hereinafter be
referred to as "Restricted Shares." The Shares which are no longer subject to
the Restrictions as set forth in paragraphs (f) or (g) below shall hereinafter
be referred to as "Transferable Shares."
(b) The Company shall effect the issuance of the Shares out of the
treasury shares of the Company and shall also effect the issuance of a
certificate or certificates for the Shares. Each certificate issued for
Restricted Shares to the Employee shall be registered in Employee's name and
shall be either deposited with the Secretary of the Company or its designee in
an escrow account or held by the Secretary of the Company, at the election of
the Company, together with stock powers or other instruments of transfer
appropriately endorsed in blank by Employee (Employee hereby agreeing to
execute such stock powers or other instruments of transfer as requested by the
Company). Such certificate or certificates shall remain in such escrow account
or with the Secretary of the Company until the earlier to occur of (i) the
termination of the Restricted Period or (ii) the expiration of the Restrictions
as set forth in paragraphs (f) or (g) below. Certificates representing the
Restricted Shares shall bear a legend in substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE MAY BE TRANSFERRED ONLY IN
COMPLIANCE WITH THE CONDITIONS SPECIFIED IN THE RESTRICTED STOCK
AGREEMENT, DATED ____________________ BETWEEN SOUTHDOWN, INC. ("COMPANY")
AND
<PAGE> 3
THE REGISTERED HOLDER OF THIS CERTIFICATE. A COPY OF THE FORM OF SUCH
AGREEMENT IS AVAILABLE FOR INSPECTION AT THE PRINCIPAL OFFICE OF THE
COMPANY AND WILL BE FURNISHED WITHOUT CHARGE TO THE REGISTERED HOLDER OF
SUCH CERTIFICATE UPON WRITTEN REQUEST.
The Company may place appropriate stop transfer instructions with respect to
the Restricted Shares with the transfer agent for the Common Stock. Upon
Restricted Shares becoming Transferable Shares, the Company shall effect, in
exchange for the legended certificates, the issuance and delivery of a
certificate or certificates for such Shares to the Employee free of the legend
set forth above.
(c) The Employee shall, during the Restricted Period, have all of the
other rights of a stockholder with respect to the Shares including, but not
limited to, the right to receive dividends, if any, as may be declared on such
Restricted Shares from time to time, and the right to vote (in person or by
proxy) such Restricted Shares at any meeting of shareholders of the Company.
(d) The Restricted Shares and the right to vote the Restricted Shares
and to receive dividends thereon, may not be sold, assigned, transferred,
exchanged, pledged, hypothecated, or otherwise encumbered and no such sale,
assignment, transfer, exchange, pledge, hypothecation, or encumbrance, whether
made or created by voluntary act of Employee or any agent of Employee or by
operation of law, shall be recognized by, or be binding upon, or shall in any
manner affect the rights of, the Company or any agent or any custodian holding
certificates for the Restricted Shares during the Restricted Period, unless the
Restrictions have then expired pursuant to the provisions of paragraphs (f) or
(g) below. This provision shall not prohibit Employee from granting revocable
proxies in customary form to vote the Shares.
(e) If the status of employment (hereinafter referred to as
"employment") of Employee with the Company or its Affiliates (as defined in
Section 6 herein) shall terminate, prior to the expiration of the Restricted
Period, for any reason other than death or disability (as defined herein) or
after a Change in Control, then, in that event, any Restricted Shares
outstanding shall, upon such termination of employment, be forfeited by
Employee to the Company, without the payment of any consideration or further
consideration by the Company, and neither Employee nor any successors, heirs,
assigns, or legal representatives of Employee shall thereafter have any further
rights or interest in the Restricted Shares or certificates therefor, and
Employee's name shall thereupon be deleted from the list of the Company's
stockholders with respect to the Restricted Shares.
(f) If the employment of Employee with the Company or its Affiliates
shall terminate by reason of death or disability, any Restrictions on the
Restricted Shares shall be deemed to have expired as to the Restricted Shares
as of the date of any such occurrence, and the Restricted Shares shall thereby
be Transferable Shares. For purposes of this Agreement, "disability" means the
inability of Employee to perform the essential requirements of his or her job
with or without reasonable accommodation.
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<PAGE> 4
(g) Upon the occurrence of a Change in Control (as defined herein),
any Restrictions on the Restricted Shares set forth in this Agreement shall be
deemed to have expired, and the Restricted Shares shall thereby be Transferable
Shares. "Change in Control" of the Company shall be conclusively deemed to have
occurred if (and only if) any of the following shall have taken place: (i) a
change in control is reported by the Company in response to either Item 6(e) of
Schedule 14A of Regulation 14A promulgated under the Securities Exchange Act of
1934, as amended ("Exchange Act") or Item 1 of Form 8-K promulgated under the
Exchange Act; (ii) any "person" (as such term is used in Sections 13(d) and
14(d)(2) of the Exchange Act) is or becomes the "beneficial owner" (as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of
the Company representing forty percent or more of the combined voting power of
the Company's then outstanding securities; or (iii) following the election or
removal of directors, a majority of the Board of Directors of the Company
("Board") consists of individuals who were not members of the Board two years
before such election or removal, unless the election of each director who was
not a director at the beginning of such two-year period has been approved in
advance by directors representing at least a majority of the directors then in
office who were directors at the beginning of the two-year period.
(h) If the employment of Employee with the Company shall terminate
prior to the expiration of the Restricted Period, and there exists a dispute
between Employee and the Company as to the satisfaction of the conditions to
the release of the Shares from the Restrictions hereunder or the terms and
conditions of the Grant, the Shares shall remain subject to the Restrictions
until the resolution of such dispute, regardless of any intervening expiration
of the Restricted Period, except that any dividends that may be payable to the
holders of record of Common Stock as of a date during the period from
termination of Employee's employment to the resolution of such dispute shall:
(1) to the extent to which such dividends would have been
payable to Employee on the Shares, be held by the Company as part of
its general funds, and shall be paid to or for the account of
Employee only upon, and in the event of, a resolution of such dispute
in a manner favorable to Employee, and
(2) be canceled upon, and in the event of, a resolution of such
dispute in a manner unfavorable to Employee.
3. Taxes. To the extent that the receipt of the Restricted Shares,
Transferable Shares, or the lapse of any Restrictions results in income to
Employee for federal or state income tax purposes, Employee shall deliver to
the Company at the time of such receipt or lapse, as the case may be, such
amount of money or, if the Company so determines, shares of unrestricted Common
Stock as the Company may require to meet its obligation under applicable tax
laws or regulations, and, if Employee fails to do so, the Company is authorized
to withhold from any cash or Common Stock remuneration then or thereafter
payable to Employee any tax required to be withheld by reasons of such
resulting compensation income. Employee agrees to notify the Company promptly
of any tax election made by Employee with respect to the Shares.
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<PAGE> 5
4. Changes in Capital Structure. If the outstanding shares of Common
Stock shall at any time be changed or exchanged or augmented by declaration of
a stock dividend, stock split, combination of shares, merger, consolidation,
recapitalization or similar event, the Shares, being outstanding shares of
Common Stock, shall be treated in the same manner as all other issued and
outstanding shares. Any cash, property or securities into which the Shares are
so changed or exchanged or so augmenting the Shares or so issued in respect of
the Shares shall be subject to the Restrictions in the same manner as the
Shares.
5. Compliance With Securities Laws.
(a) Employee represents and warrants to the Company that Employee is
acquiring the Shares for his own account, for investment, and without a view to
any sale or distribution thereof in violation of any federal or state
securities laws. Employee understands that the grant of the Shares to Employee
has not been registered under the Securities Act of 1933, as amended, or the
securities laws of any state, and, accordingly, that in addition to the other
restrictions placed on the Shares by this Agreement, the Shares may not be
offered, sold, assigned, transferred, exchanged, pledged, hypothecated or
otherwise encumbered in absence of either (a) an effective registration
statement under the Securities Act of 1933, as amended, and applicable state
securities laws or (b) an opinion of counsel satisfactory to the Company that
such registration is not required.
(b) Employee agrees that the certificates representing the Shares
(whether the Shares are Restricted Shares or Transferrable Shares) shall bear a
legend in substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS
AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, ASSIGNED, TRANSFERRED,
EXCHANGED, PLEDGED, HYPOTHECATED OR OTHERWISE ENCUMBERED IN THE ABSENCE OF
EITHER (1) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS OR (2) AN OPINION
OF COUNSEL SATISFACTORY TO SOUTHDOWN, INC. THAT SUCH REGISTRATION IS NOT
REQUIRED.
(c) Upon the execution of this Agreement and receipt of any
certificates for the Shares pursuant to this Agreement, Employee (or Employee's
legal representative upon Employee's death or disability) will enter into such
additional written representations, warranties and agreements as the Company
may reasonably request in order to comply with applicable securities laws or
with this Agreement.
6. Employment Relationship. Employee shall be considered to be in the
employment of the Company as long as he remains as an employee of the Company
or its Affiliates. Any questions as to whether and when there has been a
termination of such employment, and the cause
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<PAGE> 6
of such termination, shall be determined by the Company, with the advice of the
employing corporation (if an Affiliate of the Company), and the Company's
determination shall be final. For purposes of this Agreement, "Affiliates"
shall mean any "parent corporation" of the Company and any "subsidiary
corporation" of the Company within the meaning of Sections 424(e) and (f),
respectively, of the Internal Revenue Code of 1986, as amended.
7. Binding Effect. The terms and conditions hereof shall, in accordance
with their terms, be binding upon, and inure to the benefit of, all successors
of Employee, including, without limitation, Employee's estate and the
executors, administrators, or trustees thereof, heirs and legatees, and any
receiver, trustee in bankruptcy, or representative of creditors of Employee.
This Agreement shall be binding upon and inure to the benefit of any successors
to the Company.
8. Notice. All notices, requests, demands and other communications given
under or by reason of this Agreement shall be in writing and shall be deemed
given when delivered in person or when mailed, by certified mail (return
receipt requested), postage prepaid, addressed as follows (or to such other
address as a party may specify by notice pursuant to this provision):
(a) To the Company:
Southdown, Inc.
Attention: Secretary
1200 Smith Street, Suite 2400
Houston, Texas 77002
(b) To the Employee:
9. Arbitration. Any dispute or controversy arising under or in
connection with this Agreement shall be settled by binding arbitration in
Houston, Texas by one arbitrator appointed in the manner set forth by the
American Arbitration Association. Any arbitration proceeding pursuant to this
paragraph shall be conducted in accordance with the Employment Dispute
Resolution Rules of the American Arbitration Association. Judgment may be
entered on the arbitrators' award in any court having jurisdiction.
10. Entire Agreement and Amendments. This Agreement contains the entire
agreement of the parties relating to the matters contained herein and
supersedes all prior agreements and understandings, oral or written, between
the parties with respect to the subject matter hereof. This Agreement may be
changed only by an agreement in writing signed by the party against whom
enforcement of any waiver, change, modification, extension or discharge is
sought.
11. Separability. If any provision of the Agreement is rendered or
declared illegal or unenforceable by reason of any existing or subsequently
enacted legislation or by the decision of any
-5-
<PAGE> 7
arbitrator or by decree of a court of last resort, the parties shall promptly
meet and negotiate substitute provisions for those rendered or declared illegal
or unenforceable to preserve the original intent of this Agreement to the
extent legally possible, but all other provisions of this Agreement shall
remain in full force and effect.
12. Governing Law. The execution, validity, interpretation, and
performance of this Agreement shall be governed by, and construed in accordance
with, the laws of the State of Texas except to the extent pre-empted by federal
law.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed by one of its officers thereunto duly authorized, and Employee has
executed this Agreement, all as of the day and year first above written.
SOUTHDOWN, INC.
By:
--------------------------------------
Authorized Officer
EMPLOYEE
------------------------------------------
Name:
-------------------------------------
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