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): September 16, 1994
Joslyn Corporation
(Exact name of registrant as specified in charter)
Illinois 0-1252 36-3560095
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification
incorporation) No.)
30 South Wacker Drive, Chicago, Illinois 60606
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (312) 454-2900
Not applicable
(Former name or former address, if changed since last report)
EXHIBIT INDEX ON PAGE 5
PAGE 1 OF 132
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Item 5. Other Events.
(a) Anticipated Third Quarter Charge.
On September 16, 1994, the Registrant issued a press
release disclosing that it anticipates taking a third quarter charge
against earnings for increased environmental reserves, principally
relating to a previously disclosed site in Panama, Oklahoma. A copy
of the Registrant's press release is filed as an exhibit to this
Current Report on Form 8-K and incorporated herein by reference.
(b) Amended and Restated By-Laws.
On September 16, 1994, the Registrant's Board of Directors
approved an amendment and restatement of the Registrant's By-Laws.
Among other changes, the Registrant's By-Laws now provide that except
as otherwise provided by applicable law, a shareholder wishing to
make a proposal for shareholder vote at an annual meeting or to
nominate a candidate for election to the Board at an annual meeting
is required to give written notice to the Secretary of the Registrant
of his or her intention to make such a proposal or nomination. The
notice must be received by the Registrant not less than 60 days nor
more than 90 days prior to the annual meeting, or if less than 75
days' notice or prior public disclosure of the meeting date is given
or made, the notice must be received within 10 days after the meeting
date is announced. The notice is required to contain certain
information about both the shareholder giving the notice and the
proposal or nominee. The Registrant may require that the proposed
nominee furnish other information to determine that person's
eligibility to serve as director. A proposal or nomination that does
not comply with the above procedure will be disregarded.
Such notices of proposals or nominations should be
addressed to Wayne M. Koprowski, Secretary, Joslyn Corporation, 30
South Wacker Drive, Chicago, Illinois 60606. The 1995 Annual Meeting
of the shareholders of the Registrant is currently scheduled to be
held on April 26, 1995.
A copy of the By-Laws of the Registrant, as amended and
restated, is filed as an exhibit to this Current Report on Form 8-K
and incorporated herein by reference.
(c) Changes in Severance Arrangements and Benefit Plans.
At its meeting held on September 16, 1994, the Registrant's
Board of Directors also updated its severance arrangements for key
employees by approving severance agreements for three key executive
officers and severance policies for 42 other key employees. Under
the new arrangements, severance payments would be made and certain
employee benefits would be continued in the event of a change in
control of the Registrant, as defined in the agreements and policies,
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and a termination of employment of the covered key employees. The
Registrant estimates that if there were a change in its control
followed by a termination of employment of all of the key employees
covered by the updated arrangements, the cost to the Registrant as a
result of the updating of its severance arrangements would increase
by approximately $1,750,000 to approximately $3,800,000. At that
same meeting, the Board of Directors of the Registrant also approved
amendments to the Registrant's Executive Management Incentive Plan,
Parity Compensation Plan and Employees' Savings and Profit Sharing
Plan which provide, in each case, that if there is a change in
control of the Registrant followed by a termination of the plan or a
reduction in benefit levels thereunder, accrued benefits for the then
current year would be protected.
Copies of the new agreements, policies and benefit plan
amendments (other than the amendment to the Employees' Savings and
Profit Sharing Plan) are filed as exhibits to this Current Report on
Form 8-K and incorporated herein by reference.
Item 7. Exhibits.
3 By-Laws of the Registrant, as amended and restated on
September 16, 1994.
10.1 Form of Severance Agreement between the Registrant and
Lawrence G. Wolski.
10.2 Form of Severance Agreement between the Registrant and
Wayne M. Koprowski.
10.3 Form of Severance Agreement between the Registrant and
George W. Diehl.
10.4 Registrant's Severance Policy For Corporate Managers.
10.5 Registrant's Severance Plan For Corporate Staff For
Change In Control Situations.
10.6 September 16, 1994 Amendment to Executive Management
Incentive Plan.
10.7 Septenber 16, 1994 Amendment to Parity Compensation Plan.
20 Press Release of the Registrant issued September 16,
1994.
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SIGNATURE
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.
JOSLYN CORPORATION
By: L. G. Wolski
Name: L. G. Wolski
Title: Executive Vice President
Dated: September 19, 1994
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EXHIBIT INDEX
Exhibit
Number Description of Exhibit
3 By-Laws of the Registrant, as amended and restated on
September 16, 1994. 6
10.1 Form of Severance Agreement between the Registrant and
Lawrence G. Wolski. 52
10.2 Form of Severance Agreement between the Registrant and
Wayne M. Koprowski. 69
10.3 Form of Severance Agreement between the Registrant and
George W. Diehl. 86
10.4 Registrant's Severance Policy For Corporate Managers. 103
10.5 Registrant's Severance Plan For Corporate Staff For
Change In Control Situations. 119
10.6 September 16, 1994 Amendment to Executive Management
Incentive Plan. 125
10.7 September 16, 1994 Amendment to Parity Plan. 128
20 Press Release of the Registrant issued September 16, 132
1994.
5
Exhibit 3
BY-LAWS
OF
JOSLYN CORPORATION
(An Illinois Corporation)
As Amended and Restated on September 16, 1994
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BY-LAWS
OF
JOSLYN CORPORATION
As Amended and Restated on September 16, 1994
TABLE OF CONTENTS
ELEMENT TOPIC PAGE
ARTICLE I OFFICES, BOOKS AND RECORDS 1
Section 1.1 Offices 1
Section 1.2 Books and Records 1
ARTICLE II MEETINGS OF SHAREHOLDERS 1
Section 2.1 Place of Meetings 1
Section 2.2 Annual Meetings 2
Section 2.3 Special Meetings 4
Section 2.4 Notice of Meetings 4
Section 2.5 List of Shareholders 5
Section 2.6 Quorum and Adjournments 5
Section 2.7 Organization 6
Section 2.8 Order of Business and Procedure 7
Section 2.9 Voting by Shareholders 8
Section 2.10 Voting by Proxies 8
Section 2.11 Required Vote 8
Section 2.12 Ballots 9
ARTICLE III BOARD OF DIRECTORS 9
Section 3.1 General Powers 9
Section 3.2 Number, Qualifications, Terms of Office
and Chairman 10
Section 3.3 Election of Directors 11
Section 3.4 Newly Created Directorships and Vacancies 12
Section 3.5 Place of Meetings 12
Section 3.6 Annual Meetings 13
Section 3.7 Regular Meetings 13
Section 3.8 Special Meetings 13
Section 3.9 Quorum and Manner of Acting 14
Section 3.10 Presence at Meetings 15
Section 3.11 Organization and Procedure 15
Section 3.12 Minutes of Meetings 15
Section 3.13 Informal Action by Unanimous Consent 15
Section 3.14 Compensation 16
Section 3.15 Reliance Upon Records 16
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ARTICLE IV EXECUTIVE COMMITTEE 17
Section 4.1. Designation, Term and Vacancies 17
Section 4.2. Powers 18
Section 4.3. Procedures, Meetings, Voting and Records 20
ARTICLE V OFFICERS 20
Section 5.1. Designation 20
Section 5.2. Election and Qualifications 20
Section 5.3. Term of Office 20
Section 5.4. Vacancies 21
Section 5.5. Appointive Officers 21
Section 5.6. Compensation 21
Section 5.7. Bonds 22
Section 5.8. Employment Contracts 22
Section 5.9. Chief Executive Officer 22
Section 5.10. President 23
Section 5.11. Vice Presidents 23
Section 5.12. Secretary 24
Section 5.13. Assistant Secretaries 25
Section 5.14. Treasurer 25
Section 5.15. Assistant Treasurers 27
Section 5.16. Chief Financial Officer 27
Section 5.17. Controller 28
Section 5.18. Assistant Controllers 29
ARTICLE VI INDEMNIFICATION 29
Section 6.1. General 29
Section 6.2. Determination of Indemnification 31
Section 6.3. Advancement of Expenses 31
Section 6.4. Non-Exclusivity 32
Section 6.5. Certain Definitions 32
Section 6.6. Insurance 33
Section 6.7. Reports 33
Section 6.8. Contract with the Corporation 33
ARTICLE VII CHECKS, CONTRACTS, LOANS AND
BANK ACCOUNTS 34
Section 7.1. Checks, Drafts, etc. 34
Section 7.2. Contracts 34
Section 7.3. Loans 35
Section 7.4. Deposits 35
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ARTICLE VIII SHARES AND THEIR TRANSFER 35
Section 8.1. Certificates of Stock 35
Section 8.2. Transfer of Stock 36
Section 8.3. Lost, Destroyed, Stolen and Mutilated Certificates 36
Section 8.4. Transfer Agent and Registrar and Regulations 37
Section 8.5. Record Date 37
ARTICLE IX MISCELLANEOUS PROVISIONS 38
Section 9.1. Seal 38
Section 9.2. Fiscal Year 38
Section 9.3. Notices 39
Section 9.4. Waiver of Notice 39
Section 9.5. Resignations 40
Section 9.6. Destruction of Records 40
Section 9.7. Simultaneous Death of Directors 41
ARTICLE X INTERPRETATION, SEVERABILITY
AND AMENDMENTS 41
Section 10.1. Interpretation 41
Section 10.2. Severability 41
Section 10.3. Amendments 42
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BY-LAWS
OF
JOSLYN CORPORATION
(An Illinois Corporation)
As Amended and Restated on September 16, 1994
ARTICLE I
OFFICES, BOOKS AND RECORDS
Section 1.1.
Offices
There shall be maintained continuously a registered office and
registered agent of JOSLYN CORPORATION (herein called the
"Corporation") within the State of Illinois, the City of Chicago,
County of Cook. The Corporation may also have such other offices at
such other places both within or without the State of Illinois as the
Board of Directors of the Corporation (herein called the "Board") may
from time to time determine or the business of the Corporation may
require.
Section 1.2.
Books and Records
The books and records of the Corporation shall be kept at
the registered office of the Corporation, or at such other place or
places as the Board may from time to time determine.
ARTICLE II
MEETINGS OF SHAREHOLDERS
Section 2.1.
Place of Meetings
Meetings of shareholders shall be held at such place, either
within or without the State of Illinois,
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as may be fixed from time to time by the Board and specified in the
respective notices or waivers of notice thereof, provided that if the
Board shall not so fix the place of any meeting of shareholders or if any
special meeting of shareholders is called by a person or persons other than
the Board, such meeting shall be held at the registered office of the
Corporation.
Section 2.2.
Annual Meetings
2.2.1. An annual meeting of shareholders for the purpose of
electing directors and the transaction of such other business as may
properly be brought before the meeting shall be held each year at
such time as may from time to time be determined by the Board.
2.2.2. In the absence of such a determination by the Board
prior to twenty (20) days before the fourth Tuesday in April of each
year, such annual meeting shall be held on the fourth Wednesday in
April at the hour of 11:00 a.m., unless that day is a legal holiday, and
if it is a legal holiday, then on the next succeeding business day which
is not a legal holiday.
2.2.3. If, for any reason, the annual meeting shall not be
held at the time herein provided, the same may be held within the
earlier of six months after the end of the Corporation's fiscal year or
fifteen months after its last annual meeting upon notice as hereinafter
provided or the business thereof may be transacted at any special
meeting of shareholders called for that purpose.
2.2.4. Except as otherwise provided by law or the Articles of
Incorporation (herein meaning the Articles of Incorporation of the
Corporation as the same may be amended from time to time), the
only business which properly shall be conducted at any annual
meeting of shareholders shall (i) have been specified in the written
notice of the meeting (or any supplement thereto) given as provided
in subsection 2.4.1., (ii) be brought before the meeting by or at the
direction of the Board of Directors or the officer of the Corporation
presiding at the meeting or (iii) have been specified in a written
notice (a "Shareholder Meeting Notice") given to the Corporation, in
accordance with all of the following requirements, by or on
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behalf of any shareholder who is entitled to vote at such meeting. Each
Shareholder Meeting Notice must be delivered personally to, or be
mailed to and received by, the Secretary of the Corporation at the
principal executive offices of the Corporation in the City of Chicago,
State of Illinois, not less than 60 days nor more than 90 days prior to
the annual meeting; provided, however, that in the event that less
than 75 days' notice or prior public disclosure of the date of the
annual meeting is given or made to shareholders, notice by the
shareholder to be timely must be received not later than the close of
business on the tenth day following the day on which such notice of
the date of the annual meeting was mailed or such public disclosure
was made, whichever first occurs. Each Shareholder Meeting Notice
shall set forth: (i) a description of each item of business proposed to
be brought before the meeting and the reasons for conducting such
business at the annual meeting; (ii) the name and record address of
the shareholder proposing to bring such item of business before the
meeting; (iii) the class and number of shares of stock held of record,
owned beneficially and represented by proxy by such shareholder as of
the record date for the meeting (if such date shall then have been
made publicly available) and as of the date of such Shareholder
Meeting Notice and (iv) all other information which would be
required to be included in a proxy statement filed with the Securities
and Exchange Commission if, with respect to any such item of
business, such shareholder were a participant in a solicitation subject
to Section 14 of the Securities Exchange Act of 1934, as amended.
No business shall be brought before any annual meeting of
shareholders of the Corporation otherwise than as provided in this
Section; provided, however, that nothing contained in this Section
shall be deemed to preclude discussion by any shareholder of any
business properly brought before the annual meeting. The person
presiding at the annual meeting of shareholders shall, if the facts so
warrant, determine that business was not properly brought before the
meeting in accordance with the provisions of this subsection and, if he
should so determine and so declare to the meeting, any such business
so determined to be not properly brought before the meeting shall not
be transacted.
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Section 2.3.
Special Meetings
2.3.1. Special meetings of shareholders for any purpose or
purposes, unless otherwise prescribed by law, may be called at any
time by the Board, the Chairman, the Chief Executive Officer or the
President.
2.3.2. Special meetings of shareholders for any purpose or
purposes, unless otherwise prescribed by law, shall be called by the
Secretary promptly upon receipt of a written demand, stating the
purpose or purposes of the proposed meeting, of the holders of not
less than one-fifth (1/5) of the number of outstanding shares of stock
entitled to vote at such meeting.
2.3.3. The business transacted at any special meeting of
shareholders shall be limited to the purpose or purposes stated in the
call thereof.
Section 2.4.
Notice of Meetings
2.4.1. Written notice of each meeting of shareholders
stating the place, day and hour of the meeting, unless otherwise
prescribed by law or the Articles of Incorporation, shall be delivered
by the Secretary, personally or by mail, not less than ten (10) nor
more than sixty (60) days before the date of the meeting or, in the
case of a meeting called for the purpose of acting upon a merger,
consolidation, share exchange, dissolution or sale, lease or exchange of
assets, not less than twenty (20) nor more than sixty (60) days before
the date of the meeting, to each shareholder of record entitled to vote
at such meeting.
2.4.2. The notice of a special meeting shall state the
purpose or purposes for which the meeting is called. It shall also
identify the person or persons calling or directing the calling of the
meeting.
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Section 2.5.
List of Shareholders
2.5.1. The Secretary shall prepare, or cause to be prepared,
within twenty (20) days after the record date for a meeting of the
shareholders or ten days before such meeting, whichever is earlier, a
complete list of the shareholders entitled to vote at such meeting,
arranged in alphabetical order, with the address of and the number of
shares of each class of stock of the Corporation registered in the
name of each shareholder.
2.5.2. The list of shareholders entitled to vote at a meeting
shall be subject to inspection by any shareholder, and to copying at
the shareholder's expense, for any purpose germane to the meeting, at
any time during usual business hours, for a period of at least ten days
prior to the meeting, at the registered office of the Corporation.
2.5.3. Such list shall also be produced and kept open at the
time and place of the meeting and shall be subject to the inspection
of any shareholder during the whole time of the meeting.
2.5.4. The validity of the proceedings had or taken at any
meeting of shareholders shall in no way be affected by the failure of
the Secretary to prepare such list or by reason of the fact that such
list has not been so kept on file, subject to the inspection of
shareholders, for ten days before such meeting.
2.5.5. The original share ledger or transfer book, or a
duplicate thereof kept in the State of Illinois, shall be prima facie
evidence as to who are the shareholders entitled to examine such list
or share ledger or transfer book or to vote at any meeting of
shareholders.
Section 2.6.
Quorum and Adjournments
2.6.1. For the purpose of any action to be taken by
shareholders at any meeting, the presence in person or by proxy of the
shareholders of record holding a majority of the outstanding shares of
stock of the Corporation, entitled to vote on a matter, shall constitute
a quorum for consideration of such matter, except as otherwise
expressly provided by law or by the Articles of Incorporation.
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2.6.2. If a quorum, as provided in subsection 2.6.1. hereof,
shall not be present, in person or by proxy, at any meeting of the
shareholders, the shareholders entitled to vote at the meeting present
in person or represented by proxy shall have the power to adjourn the
meeting from time to time, without notice other than announcement
at the meeting, until such a quorum shall be present or represented.
At such adjourned meeting at which a quorum shall be present in
person or by proxy, any business may be transacted which might have
been transacted at the meeting as originally notified.
2.6.3. The absence from any meeting of shareholders of the
number of holders of record of so much of the stock of the
Corporation as required by law, the Articles of Incorporation or these
by-laws for action upon any given matter shall not prevent action at
such meeting upon any other matter or matters which may properly
come before the meeting if the number required in respect to such
other matter or matters shall be present and provided always that a
quorum must be present as provided in Section 2.6.1.
2.6.4. Nothing in these by-laws shall affect the right to
adjourn any meeting from time to time when a quorum is present.
Section 2.7.
Organization
2.7.1. At any meeting of shareholders, the Chairman, or in
his absence the Chief Executive Officer, or in his absence the
President, or in the absence of all of the foregoing, a Vice President
appointed in writing by one of them, or in the absence of all of the
foregoing, a person chosen by a majority of the votes entitled to be
cast by the shareholders of the Corporation present in person or by
proxy and entitled to vote at the meeting shall act as chairman of the
meeting; and the Secretary, or in his absence an Assistant Secretary,
or in the absence of the Secretary and all Assistant Secretaries, a
person whom the chairman of the meeting shall appoint, shall act as
secretary of the meeting.
2.7.2. The Board, in advance of any meeting of shareholders,
may appoint one or more inspectors of election to act at such meeting
or any adjournment thereof.
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2.7.3. If inspectors of election are not appointed by the
Board prior to any meeting of shareholders, the chairman of such
meeting may, or upon the request of any shareholder shall, appoint
one or more persons as inspectors of election at any time during the
course of the meeting.
2.7.4. In case any inspector of election appointed pursuant to
subsection 2.7.2. or 2.7.3. fails to appear or to act, the vacancy may be
filled by the chairman of the meeting.
2.7.5. Each inspector of election, before entering upon the
discharge of his duties, shall take and sign an oath faithfully to
execute the duties of inspector at such meeting with strict impartiality
and according to the best of his ability.
2.7.6. The duties of the inspectors of election shall be to
ascertain and report the number of shares represented at the meeting,
to determine the validity and effect of all proxies, to count all the
votes and report the results thereof, and to do such other acts as are
proper to conduct the election and voting with impartiality and
fairness to the shareholders.
2.7.7. If no inspector is appointed as herein provided, such
duties shall be performed by the secretary of the meeting.
2.7.8. The report of the inspector or inspectors on the
number of shares represented at the meeting and the results of the
voting shall be prima facie evidence thereof.
Section 2.8.
Order of Business and Procedure
2.8.1. The chairman of the meeting shall have the right to
decide, without appeal, the order of business for such meeting and all
procedural motions, questions and other matters (including the right
to limit discussion as being unreasonably cumulative or prolonged or
irrelevant to a pending question) pending before the meeting.
2.8.2. The Corporation shall keep minutes of the proceedings
of its shareholders' meetings.
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Section 2.9.
Voting by Shareholders
Except as otherwise expressly provided by law or by the
Articles of Incorporation or these by-laws, each shareholder present in
person or by proxy at any meeting shall have, on each matter on
which such shareholder is entitled to vote, one vote with respect to
each share of stock registered in his name on the books of the
Corporation on the date fixed pursuant to Section 8.5 hereof as the
record date for the determination of shareholders entitled to notice of
and to vote at such meeting.
Section 2.10.
Voting by Proxies
Any shareholder entitled to vote at any meeting may vote
either in person or by proxy, signed by such shareholder (or by his
attorney-in-fact thereunto authorized in writing) and delivered to the
secretary of the meeting; provided, however, that no proxy shall be
valid after the expiration of eleven (11) months from the date of its
execution, unless otherwise provided in the proxy. Every proxy shall
continue to be in full force and effect until revoked by the person
executing it prior to the vote pursuant thereto except as otherwise
provided by law. Such revocation may be effected by a writing
delivered to the Corporation stating that the proxy is revoked or by a
subsequent proxy executed by, or by attendance at the meeting and
voting in person by, the person executing the proxy.
Section 2.11.
Required Vote
2.11.1. Except as otherwise expressly provided by law or by
the Articles of Incorporation or these by-laws, every matter other than
that of the election of directors to be decided by shareholders at any
meeting shall be decided by the affirmative vote of the majority of the
shares represented at the meeting and entitled to vote on such matter,
provided a quorum is present.
2.11.2. In all elections for directors, every shareholder so
entitled to vote shall have the right to vote, in person or by proxy, the
number of shares owned by such shareholder for as many persons as there
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are directors to be elected, or to cumulate such votes and give
one candidate as many votes as shall equal the number of directors
multiplied by the number of such shares or to distribute such
cumulative votes in any proportion among any number of candidates.
2.11.3 In all elections for directors, except as otherwise
required by law or the Articles of Incorporation, the number of
nominees as determined in subsection 3.2.1 receiving the greatest
number of votes to fill the vacancies on the Board shall be elected to
fill those vacancies at the meeting of shareholders by the shareholders
of the Corporation present in person or by proxy and entitled to vote
in such election, provided a quorum is present at such meeting.
Section 2.12.
Ballots
2.12.1. Unless directed by the chairman of the meeting or
demanded by the holders of a majority of the shares of stock of the
Corporation present in person or by proxy at any meeting and entitled
to vote thereon, the vote on any matter need not be by ballot, but
upon any such direction or such demand, such vote shall be taken by
ballot.
2.12.2. On a vote by ballot, each ballot, to be qualified and
counted, shall be signed by the shareholder voting or by his proxy, if
there be such proxy, and shall state the number of shares voted by
him. Anyone wishing to cumulate votes should receive a ballot and
indicate how many shares will be voted for a director
candidate/nominee.
ARTICLE III
BOARD OF DIRECTORS
Section 3.1.
General Powers
3.1.1. The business and affairs of the Corporation shall be
managed by or under the direction of the Board as from time to time
constituted.
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3.1.2. The Board may exercise all powers, rights and
privileges of the Corporation (whether expressed or implied in the
Articles of Incorporation or conferred by law) and do all acts and
things which may be done by the Corporation, as are not by law, the
Articles of Incorporation or these by-laws directed or required to be
exercised or done by the shareholders.
Section 3.2.
Number, Qualifications, Terms of Office and Chairman
3.2.1. The Board of Directors of the Corporation shall
consist of no less than three (3) nor more than eight (8) persons.
Notwithstanding any other provisions of these by-laws, any change by
the Board in the number of directors shall be by resolution of the
Board adopted by the affirmative vote of not less than seventy-five
percent (75%) of the directors then qualified.
3.2.2. The term of office of each director elected at any
annual meeting of shareholders shall begin at the time of such
election and expire at the next annual shareholders' meeting following
their election.
3.2.3. Notwithstanding the foregoing, the term of office of a
director shall continue until the successor to such director shall be
elected and qualified unless the directorship is eliminated, in which
case the term of office shall expire at the appropriate annual meeting,
or at any earlier time when such office, being lawfully vacant, is
eliminated; provided, however, that a decrease in the number of
directors does not shorten an incumbent director's term.
3.2.4. A person elected as a director shall be deemed to have
qualified as a director if he shall have met the qualifications for
directors prescribed by law, the Articles of Incorporation and these
by-laws, and if he shall have indicated, in any form whatever, his
willingness to serve as a director of the Corporation.
3.2.5. One member of the Board shall be elected Chairman.
The Chairman shall preside at all meetings of the shareholders of the
Corporation and of the Board.
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Section 3.3.
Election of Directors
3.3.1. Directors shall be elected as provided in these by-laws
at each annual meeting of the shareholders, or if for any reason the
election shall not have been held at an annual meeting, at any special
meeting called for that purpose after proper notice. Directors shall
be elected solely from those persons nominated for director at the
meeting.
3.3.2. Nominations for the election of directors may be made
by the Board of Directors or a committee appointed by the Board of
Directors pursuant to subsection 4.1.5. or by any shareholder entitled
to vote in the election of directors generally. However, any
shareholder entitled to vote in the election of directors generally may
nominate one or more persons for election as directors at a meeting
at which directors are to be elected only if written notice of such
shareholder's intent to make such nomination or nominations has
been delivered personally to, or been mailed to and received by, the
Secretary of the Corporation at the principal executive offices of the
Corporation in the City of Chicago, State of Illinois, not less than 60
days nor more than 90 days prior to the meeting; provided, however,
that, in the event that less than 75 days' notice or prior public
disclosure of the date of the meeting is given or made to shareholders,
notice by the shareholder to be timely must be so received not later
than the close of business on the tenth day following the day on which
such notice of the date of the meeting was mailed or such public
disclosure was made, whichever first occurs. Each such notice shall
set forth: (i) the name and record address of the shareholder who
intends to make the nomination; (ii) the name, age, principal
occupation or employment, business address and residence address of
the person or persons to be nominated; (iii) the class and number of
shares of stock held of record, owned beneficially and represented by
proxy by such shareholder and by the person or persons to be
nominated as of the record date for the meeting (if such date shall
then have been made publicly available) and of the date of such
notice; (iv) a representation that the shareholder intends to appear in
person or by proxy at the meeting to nominate the person or persons
specified in the notice; (v) a description of all arrangements or
understandings between such shareholder and each nominee and any
other person or persons (naming such person or persons pursuant to
which the nomination or nominations are to be made by such
shareholder; (vi) such
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other information regarding each nominee proposed by such shareholder as
would be required to be included in a proxy statement filed pursuant to the
Securities Exchange Act of 1934, as amended, and the proxy rules of the
Securities and Exchange Commission thereunder; and (vii) the consent of each
nominee to serve as a director of the corporation if so elected. The
Corporation may require any proposed nominee to furnish such other
information as may reasonably be required by the Corporation to determine the
eligibility of such proposed nominee to serve as a director of the
Corporation. The person presiding at the annual meeting of
shareholders shall, if the facts so warrant, determine that a
nomination was not made in accordance with the provisions of this
subsection, and if he should so determine and so declare to the
meeting, the defective nomination shall be disregarded. No person
shall be eligible for election as a director of the Corporation unless
nominated in accordance with the procedures set forth herein.
Section 3.4.
Newly Created Directorships and Vacancies
3.4.1. Any vacancy occurring in the Board and any
directorship to be filled by reason of an increase in the number of
directors may be filled by election at an annual meeting or at a special
meeting of the shareholders called for that purpose; provided,
however, that the Board may fill vacancies arising between meetings of
shareholders for any reason including vacancies due to an increase in
the number of directors.
3.4.2. A director elected by the shareholders to fill a vacancy
shall hold office for the balance of the term for which he was elected.
A director appointed by the Board to fill a vacancy shall serve until
the next meeting of shareholders at which directors are to be elected.
Section 3.5.
Place of Meetings
The Board may hold its meetings at any place within or
without the State of Illinois.
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Section 3.6.
Annual Meeting
A regular meeting of the Board for the purposes of
organization, election of officers and transaction of such other
business as the Board may choose shall be held, if practicable, at the
close of each annual meeting of shareholders for election of directors
and in the city where the annual meeting was held.
Section 3.7.
Regular Meetings
Regular meetings of the Board may be held at such time and
place as may from time to time be specified in a resolution or
resolutions adopted by the Board without further notice. Attendance
of a director at any meeting shall constitute a waiver of notice of such
meeting except where a director attends a meeting for the express
purpose of objecting to the transaction of any business because the
meeting is not lawfully called or convened.
Section 3.8.
Special Meetings
3.8.1. Special meetings of the Board may be called at any
time by the Board, the Chairman, the Chief Executive Officer, the
President or by such number of directors as shall be not less than a
majority of the Board.
3.8.2. Notice of a special meeting shall be given by the
Secretary or by the person or persons calling such meeting, either
personally or by mail or by public wire or wireless communications
media or telephone, to each director not less than 24 hours before the
time of such meeting.
3.8.3 Every notice of a special meeting of the Board shall
state the time and place of the meeting, which shall be fixed by the
person or persons calling such meeting, but need not state the
purposes thereof except as otherwise required by law or these by-laws.
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Section 3.9.
Quorum and Manner of Acting
3.9.1. At each meeting of the Board the presence of a
majority of the directors then in office (as constituted pursuant to
subsection 3.2.1. and selected pursuant to the provisions of Section 3.3
or 3.4 hereof) but not less than a majority of the minimum number of
directors specified in Section 3.2.1 herein, shall be necessary to
constitute a quorum for the transaction of business.
3.9.2. The act of a majority of the directors present at the
time of taking such vote, if a quorum shall be present at such time,
shall be the act of the Board, except as may be otherwise specifically
provided by law, the Articles of Incorporation or these by-laws.
3.9.3. Notwithstanding any other provisions of these by-laws,
any consolidation or merger of the Corporation other than with a
subsidiary corporation, any sale, lease, exchange, mortgage, pledge or
other disposition of all, or substantially all, the property and assets of
the Corporation, any dissolution or liquidation of the Corporation or
any amendment to the Articles of Incorporation of the Corporation
shall not be initiated or consummated, or submitted to the
shareholders of the Corporation for their consideration, unless a
resolution of the Board shall first be adopted by the affirmative vote
of not less than seventy-five percent (75%) of the directors then
qualified and acting recommending such action and directing the
submission thereof to a vote at a meeting of shareholders, which may
be either an annual or special meeting.
3.9.4. Any meeting of the Board may be adjourned from time
to time by a majority vote of the directors present at such meeting.
3.9.5. In the absence of a quorum at such meeting, a majority
of the directors present thereat may adjourn the meeting from time to
time, without notice other than announcement at the meeting, until a
quorum shall be present at the meeting.
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Section 3.10.
Presence at Meetings
Directors may participate in and act at any meeting of the
Board or any committee thereof through the use of a conference
telephone or other communications equipment by means of which all
persons participating in the meeting can hear each other.
Participation in such a meeting shall constitute attendance and
presence in person at the meeting of the person or persons so
participating for all purposes including fulfilling the requirements of
subsection 3.9.1. through 3.9.5.
Section 3.11.
Organization and Procedure
3.11.1. At each meeting of the Board, the Chairman, or in his
absence the Chief Executive Officer if he is also a director, or in his
absence the President if he is also a director, or in the absence of all
of them a director chosen by the Board, shall act as chairman of the
meeting.
3.11.2 The Secretary of the Corporation, or in his absence
an Assistant Secretary of the Corporation, or in the absence of all of
the foregoing, a person appointed by the chairman of the meeting,
shall act as secretary of the meeting.
3.11.3. The chairman of the meeting shall, without
relinquishing the chairmanship of the meeting, have full power of
discussion and voting power in respect to any matter before the
meeting.
Section 3.12.
Minutes of Meetings
The Board shall cause to be kept minutes of its proceedings.
Section 3.13.
Informal Action by Unanimous Consent
Unless otherwise restricted by statute, the provisions of the
Articles of Incorporation or these by-laws, any action required or
permitted to be taken at any meeting of the Board or a committee thereof, or
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any other action which may be taken at a meeting of the
Board or a committee thereof, may be taken without a meeting if a
consent in writing, setting forth the action so taken, shall be signed by
all of the directors entitled to vote with respect to the subject matter
thereof, or by all the members of the committee, as the case may be,
which consent shall be filed with the minutes of proceedings of the
Board or committee.
Section 3.14.
Compensation
3.14.1. Each director shall be entitled to receive such
compensation, fees and expenses, if any, for his services as a director
as may be fixed from time to time by resolution of the Board.
3.14.2. Each director shall also be entitled to receive such
compensation, fees and expenses for his services rendered to the
Corporation as an officer, member of committees, or in any capacity
other than as a director, as may be provided from time to time by
resolution of the Board, and he shall also be entitled to
reimbursement for his expenses incurred in the performance of any
such services.
Section 3.15.
Reliance upon Records
Every director of the Corporation or member of any
committee of the Board shall, in the performance of his duties, be
fully protected in relying in good faith upon the records of the
Corporation and upon such information, opinions, reports or
statements presented to the Corporation by any of the Corporation's
officers or employees, or committees of the Board, or by any other
person as to matters the director or member reasonably believes are
within such other person's professional or expert competence and who
has been selected with reasonable care by or on behalf of the
Corporation.
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ARTICLE IV
EXECUTIVE COMMITTEE
Section 4.1.
Designation, Term and Vacancies
4.1.1. The Board, by resolution passed by a majority of the
entire Board, may designate two or more of its members, in which the
Chief Executive Officer and the President shall be included (to the
extent that they are also directors), as it may from time to time
determine, to constitute an Executive Committee, and it may
designate one or more other directors to serve as alternates for the
members thereof in such order and manner as may be fixed by the
Board.
4.1.2. The term of office of each member of the Executive
Committee shall be for a period beginning with the date of his
designation and shall continue until his successor shall have been
designated.
4.1.3. Any member of the Executive Committee may be
removed from the Executive Committee or his office may be declared
vacant at any time by a majority of the Board without assigning (and
without there existing) any reason or cause as the basis thereof.
4.1.4. The Chief Executive Officer, if he is also a director, or
in his absence the President, if he is also a director, or in the absence
of both of them, a member of the Executive Committee selected by
those present, shall preside at meetings of the Executive Committee,
and the Secretary or any Assistant Secretary of the Corporation, or in
the absence of all of these a member of the Executive Committee
selected by those present, shall be the secretary of such meetings.
4.1.5. The Board, by resolution passed by a majority of the
entire Board, may create such other committees as it deems necessary.
Each committee shall have two or more members, who shall serve at
the pleasure of the Board.
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Section 4.2.
Powers
4.2.1. During the intervals between meetings of the Board,
the Executive Committee shall have, to the fullest extent permitted by
law, but subject to any specific limitations imposed by the Articles of
Incorporation, these by-laws or a resolution of the Board, all of the
powers vested in or retained by the Board (whether or not the
Executive Committee is specifically mentioned in the statute, the
provisions of the Articles of Incorporation or these by-laws, the
resolution or other instrument vesting or retaining any such power)
and such further specific powers as may from time to time be
conferred upon the Executive Committee by resolution of the Board.
Any other committee shall have such powers as are designated from
time to time by resolution of the Board, not to exceed these powers
vested in the Executive Committee.
4.2.2. A committee may exercise the powers vested in it in
such manner as it shall deem to be in the best interests of the
Corporation in all cases in which specific directions shall not have
been given by the Board.
4.2.3. The Executive Committee shall not have the power or
authority of the Board to:
(a) Amend the Articles of Incorporation;
(b) Adopt a plan of merger or consolidation;
(c) Approve or recommend to shareholders any act that
the Illinois Business Corporation Act of 1983 (the "BCA"), as then
amended, requires to be approved by shareholders;
(d) Fill vacancies on the Board or on any of its
committees;
(e) Adopt, amend or repeal these by-laws;
(f) Declare a dividend or authorize any other
distributions;
(g) Authorize the issuance of stock;
(h) Elect or remove officers of the Corporation;
(i) Elect, remove or fix the compensation of members of
any committee;
(j) Amend, repeal or take action inconsistent with a
resolution or action of the Board which by its terms provides that it
shall not be amended or repealed by a committee;
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(k) Authorize or approve reacquisition of shares, except
according to a general formula or method prescribed by the Board; or
(l) Authorize or approve the issuance or sale, or contract
for sale, of shares or determine the designation and relative rights,
preferences, and limitations of a series of shares, except that the
Board may direct a committee to fix the specific terms of the issuance
or sale or contract for sale or the number of shares to be allocated to
particular employees under an employee benefit plan.
4.2.4. All action taken by a committee shall be subject to
revision or alteration by the Board at the meeting of the Board at
which any such action is reported to the Board; provided, however,
that such revision or alteration shall not affect any action taken by
any officer or employee of the Corporation, or by any third party, or
any rights of third parties that have vested, in reliance upon any
action or direction of a committee.
Section 4.3.
Procedure, Meetings, Voting and Records
4.3.1. A committee may prescribe for the conduct of its
business such rules and regulations, not inconsistent with these by-
laws or with such resolutions for the guidance and control of such
committee as may from time to time be passed by the Board, as it
shall deem necessary or desirable, including, without limitation, rules
fixing the time and place of meetings and the notice to be given
thereof, if any.
4.3.2. A majority of the members of a committee exclusive of
alternate members shall constitute a quorum for the transaction of
business.
4.3.3. The adoption of any resolution or the taking of any
other action shall require the affirmative vote of a majority of the
committee exclusive of alternate members as from time to time
constituted.
4.3.4. A committee shall keep minutes of its proceedings, and
it shall report all action taken by it to the Board at the meeting
thereof held next after the taking of such action.
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ARTICLE V
OFFICERS
Section 5.1.
Designation
5.1.1. The principal officers of the Corporation shall be a
Chief Executive Officer, a President, one or more Vice Presidents, a
Secretary, a Treasurer, and a Chief Financial Officer; and there may
be such other officers as shall be appointed in accordance with the
provisions of Section 5.5. of these by-laws.
5.1.2. Any two or more offices may be held by the same
person.
Section 5.2.
Election and Qualifications
The principal officers of the Corporation shall be elected by
the Board at any time.
Section 5.3.
Term of Office
5.3.1. Each principal officer of the Corporation shall hold
office until the next annual meeting of the Board following his
election and until his successor shall have been elected and qualified,
or until his death, or until he shall resign, or until he shall have been
removed.
5.3.2. Any officer may be removed at any time by the Board
with or without cause, whenever in its judgment the best interests of
the Corporation will be served thereby.
5.3.3. The removal of an officer without cause shall be
without prejudice to his contract rights, if any.
5.3.4. The election of an officer shall not of itself create
contract rights.
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Section 5.4.
Vacancies
A vacancy in the office of a principal officer may, at the sole
discretion of the Board, be filled for the unexpired portion of the
term in the manner prescribed in these by-laws for regular election to
such office. Vice Presidencies which have been vacated may be left
vacant at the discretion of the Board.
Section 5.5.
Appointive Officers
5.5.1. The Board or the Chief Executive Officer may appoint
such officers other than principal officers, including a Controller and
one or more Assistant Secretaries, Assistant Treasurers, Assistant
Controllers and officers having such other designations as the Board
or the Chief Executive Officer may deem necessary or advisable,
provided, however, that any such appointment by the Chief Executive
Officer shall be subject to confirmation by the Board at its next
meeting following such appointment.
5.5.2. The Chief Executive Officer or the President may
appoint division officers.
5.5.3. Each appointive officer shall hold his office or his
position, as the case may be, for such period, have such authority, and
perform such duties as may be provided in these by-laws or as the
Board or the officer authorized to appoint such appointive officer may
from time to time determine.
5.5.4. The Chief Executive Officer or the appropriate
appointing officer may prescribe additional duties to be performed by
such officers and the Chief Executive Officer or the appropriate
appointing officer may at any time suspend the duties, of whatever
nature, of any such officer.
Section 5.6.
Compensation
5.6.1. The compensation of the Chief Executive Officer and
each other principal officer shall be fixed and determined from time
to time by the Board or a committee thereof duly authorized to fix
and determine such compensation.
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5.6.2. The Chief Executive Officer shall fix and determine, or
delegate in any manner he shall select, the power to fix and determine
the compensation of all other officers, agents and employees of the
corporation, unless the Board or a committee thereof shall by
resolution otherwise direct.
Section 5.7.
Bonds
5.7.1. The Treasurer and any Assistant Treasurer, and such
other officers and agents of the Corporation as the Board or the Chief
Executive Officer shall prescribe, may be required each to give bond
to the Corporation in such form and amount and with such surety as
the Board or the Chief Executive Officer may determine, conditioned
upon the faithful performance of the duties of his office, and upon the
return to the Corporation in the case of his death, resignation,
retirement or removal, of all books, vouchers, money or other papers
or things in his possession or under his control belonging to the
Corporation.
5.7.2. The Corporation shall pay the premium cost of such
bonds.
Section 5.8.
Employment Contracts
Every employment for personal services to be rendered to the
Corporation shall be at the pleasure of the Corporation unless it is
under a contract in writing which has been duly executed on behalf of
the Corporation and has been approved by the Board or by the Chief
Executive Officer.
Section 5.9.
Chief Executive Officer
5.9.1. Subject to the direction of the Board, the Chief
Executive Officer, who may be, but is not required to be, the
President of the Corporation, shall have general charge of the
business of the Corporation.
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5.9.2. The Chief Executive Officer shall have full power to
vote in the Corporation's name, in person or by proxy, all shares of
stock of other corporations owned by the Corporation.
5.9.3. The Chief Executive Officer may sign and execute all
deeds, mortgages, bonds, contracts, checks or other instruments or
obligations in the name of the Corporation.
5.9.4. The Chief Executive Officer may sign, with the
Secretary of the Corporation or an Assistant Secretary, or with the
Treasurer or an Assistant Treasurer, all certificates for shares of
capital stock of the Corporation.
5.9.5. The Chief Executive Officer may appoint, remove,
suspend and prescribe the duties and responsibilities of such agents
and employees as he may deem necessary or advisable in the
operations of the Corporation.
5.9.6. The Chief Executive Officer shall have such other
powers and perform such other duties as may be vested in him by law,
by other provisions of these by-laws or by the Board.
Section 5.10.
President
5.10.1. Subject to the direction of the Board and the Chief
Executive Officer, the President shall be responsible for administering
the operating policies of the Corporation, as established from time to
time by the Board or the Chief Executive Officer.
5.10.2. In the absence of the Chief Executive Officer or in
the event of his inability to act, the President shall perform the
responsibilities, authorities and duties of the Chief Executive Officer.
5.10.3. The President shall have such other powers and
perform such other duties as may from time to time be assigned to
him by the Board or by the Chief Executive Officer.
Section 5.11.
Vice Presidents
5.11.1. Each Vice President shall have such power and rank
and perform such duties as the Board, the Chief Executive Officer or
the President may from time to time prescribe.
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5.11.2. At the written request of the Chief Executive Officer
or the President, any Vice President may, in the case of the absence
or inability to act of the President, temporarily act in his place.
5.11.3. In the case of the death of the President, or in the
case of his absence or inability to act without his first having
designated a Vice President to act temporarily in his place, one or
more Vice Presidents may be designated by the Chief Executive
Officer to perform the duties, or any particular duty, of the President.
5.11.4. Each Vice President may be given such additional
designations or titles as, in the judgment of the Board, are descriptive
of his duties or are otherwise appropriate to reflect his position or
rank.
Section 5.12.
Secretary
5.12.1. The Secretary of the Corporation shall attend all
meetings of the shareholders and shall be and act as the secretary of
such meetings unless a different secretary of the meeting shall have
been appointed pursuant to these by-laws.
5.12.2. The Secretary shall attend all meetings of the Board
and of the Executive Committee and shall be and act as the secretary
of such meetings unless a different secretary of such meetings shall
have been appointed pursuant to these by-laws.
5.12.3. The Secretary shall give, or cause to be given, all
notices provided for in these by-laws or required by the Articles of
Incorporation or by law.
5.12.4. The Secretary shall be custodian of the records and of
the seal of the Corporation and see that the seal is affixed to all
documents the execution of which on behalf of the Corporation under
its seal is duly authorized in accordance with these by-laws.
5.12.5. The Secretary shall have charge of the stock certificate
books of the Corporation, and keep or cause to be kept the stock
certificate books, stock transfer books and stock ledgers in such
manner as to show, at all times, the amount of the capital stock issued
and outstanding, the classes thereof, if any, the names alphabetically
arranged, the places of residence of the holders of record thereof, the
number of shares held by each and the time when each became a
holder of record.
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5.12.6. The Secretary shall have charge of all books, records
and papers of the Corporation relating to its organization as a
Corporation and its legal affairs, shall have the authority to certify the
by-laws and resolutions of the shareholders and the Board and
committees thereof, and other documents of the Corporation as true
and correct copies thereof, and shall see that all reports, statements
and other documents required by law are properly kept or filed,
except to the extent that the same are to be kept or filed by the
Treasurer or Controller or by any appointive officer, agent or
employee.
5.12.7. The Secretary may sign with the Chief Executive
Officer, the President or any Vice President any or all certificates of
stock of the Corporation.
5.12.8. In general, the Secretary shall exercise all powers and
perform all duties incident to the office of Secretary and such other
powers and duties as may from time to time be assigned to him by the
Board, the Chief Executive Officer or the President or be prescribed
by these by-laws.
Section 5.13.
Assistant Secretaries
5.13.1. When one or more Assistant Secretaries have been
appointed, he or they shall assist at all times in the performance of
the duties of the Secretary, subject to his control and direction, and,
in the absence of the Secretary, or in the event of his inability or
refusal to act, an Assistant Secretary designated therefor by the Board,
the Chief Executive Officer or the President, or in the absence of such
designation, any Assistant Secretary, may exercise the powers and
perform the duties of the Secretary.
5.13.2. Each Assistant Secretary shall exercise such powers
and perform such duties as may from time to time be assigned to him
by the Board, the Chief Executive Officer, the President or the
Secretary, or be prescribed by these by-laws.
Section 5.14.
Treasurer
5.14.1. The Treasurer shall have charge of and be responsible
for the collection, receipt, custody and disbursements of the corporate
funds and securities.
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5.14.2. The Treasurer shall be responsible for the deposit of
all moneys, and other valuable effects, in the name and to the credit
of the Corporation in such depositories as may be designated by the
Board, the Chief Financial Officer (or by an officer of the
Corporation pursuant to any delegation of such authority by the
Board).
5.14.3. The Treasurer shall disburse the funds of the
Corporation as may be ordered by the Board or the Chief Financial
Officer or as may be authorized pursuant to authorizations of the
Board or these by-laws, and he shall require proper vouchers or other
evidence supporting such disbursements.
5.14.4. The Treasurer shall be responsible for administering
policies of the Corporation with respect to the approving, granting or
extending of credit by the Corporation.
5.14.5. The Treasurer shall have the custody of such books,
receipted vouchers and other books and papers as in the practical
business operations of the Corporation shall naturally belong to the
office or custody of the Treasurer, or as shall be placed in his custody
by the Board or by the Chief Executive Officer, the President or the
Chief Financial Officer.
5.14.6. The Treasurer shall render to the Board, or to the
Chief Executive Officer, the President or the Chief Financial Officer,
whenever they may require it, an account of all of his transactions as
Treasurer.
5.14.7. The Treasurer may sign with the Chief Executive
Officer or the President or any Vice President any or all certificates of
stock of the Corporation.
5.14.8. In general, the Treasurer shall exercise all powers and
perform all duties incident to the office of Treasurer and such other
powers and duties as may from time to time be assigned to him by the
Board, the Chief Executive Officer, the President or the Chief
Financial Officer or be prescribed by these by-laws.
5.14.9. The duties of the Treasurer shall extend to all
subsidiary corporations and, so far as the Board, the Chief Executive
Officer, the President or the Chief Financial Officer may deem
practicable, to all affiliated corporations.
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Section 5.15.
Assistant Treasurers
5.15.1. When one or more Assistant Treasurers have been
appointed, he or they shall assist at all times in the performance of
the duties of the Treasurer, subject to his control and direction, and,
in the absence of the Treasurer or in the event of his inability or
refusal to act, the Assistant Treasurer designated therefor by the
Board, the Chief Executive Officer or the President, or in the absence
of such designation, any Assistant Treasurer, shall exercise the powers
and perform the duties of the Treasurer.
5.15.2. Each Assistant Treasurer shall exercise such powers
and perform such duties as may from time to time be assigned to him
by the Board, the Chief Executive Officer, the President, the Chief
Financial Officer or the Treasurer, or be prescribed by these by-laws.
Section 5.16.
Chief Financial Officer
5.16.1. The Chief Financial Officer shall be responsible for
the Corporation's overall financial plans and policies.
5.16.2. The Chief Financial Officer shall supervise the
Treasury function in providing and directing procedures for the
safeguarding of Corporate assets, investing cash in excess of normal
requirements and obtaining debt or capital financing.
5.16.3. The Chief Financial Officer shall direct the
Controllership function in providing and directing procedures and
systems necessary to maintain proper records and to afford adequate
accounting controls and services.
5.16.4. The Chief Financial Officer shall, with the assistance
of the Controller, appraise the Corporation's financial position and
issue periodic financial and operating reports.
5.16.5. The Chief Financial Officer shall, with the assistance
of the Controller, direct and coordinate the establishment of
corporate budget programs.
5.16.6. The Chief Financial Officer shall assist the Vice
Presidents in coordinating expenditure programs with forecasted cash
flow.
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5.16.7. The Chief Financial Officer shall establish operating
performance criteria (e.g. cost of capital).
5.16.8. The Chief Financial Officer may be responsible for
supervision of the corporate data processing and tax functions.
5.16.9. The Chief Financial Officer may be responsible for
the Corporation's insurance and audit programs.
5.16.10. The Chief Financial Officer shall be the
Corporation's contact with the financial community and financial
press.
5.16.11. The Chief Financial Officer shall perform all the
duties ordinarily connected with the office of Chief Financial Officer
and such other duties or special projects as may be assigned him from
to time by the Board, the Chief Executive Officer, the President, or by
these by-laws.
Section 5.17.
Controller
5.17.1. The Controller shall be the chief accounting officer of
the Corporation and shall have charge of the Corporation's books of
accounts.
5.17.2. The Controller shall maintain full and accurate
records of all assets, liabilities, commitments and financial transactions
of the Corporation.
5.17.3. The Controller shall see that an adequate system of
internal control is maintained and that all reasonable measures are
taken to protect the Corporation's assets.
5.17.4. The Controller shall compile costs of production and
distribution.
5.17.5. The Controller shall prepare and interpret all
statistical records and reports of the Corporation.
5.17.6. The Controller shall render such financial statements
and other information as may be directed by the Chief Financial
Officer.
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5.17.7. In general, the Controller shall perform all duties
ordinarily connected with the office of Controller and such other
duties as from time to time may be assigned to him by the Board, the
Chief Executive Officer, the President or the Chief Financial Officer
or be prescribed by these by-laws.
Section 5.18.
Assistant Controllers
5.18.1. When one or more Assistant Controllers have been
appointed, he or they shall assist at all times in the performance of
the duties of the Controller, subject to his control and direction, and,
in the absence of the Controller, or in the event of his inability or
refusal to act, the Assistant Controller designated by the Board or the
Chief Executive Officer, the President or the Chief Financial Officer,
or in the absence of such designation, any Assistant Controller, shall
exercise the powers and perform the duties of the Controller.
5.18.2. Each Assistant Controller shall exercise such powers
and perform such duties as may from time to time be assigned to him
by the Board, the Chief Executive Officer, the President, the Chief
Financial Officer or the Controller, or be prescribed by these by-laws.
ARTICLE VI
INDEMNIFICATION
Section 6.1.
General
6.1.1. The Corporation shall indemnify any person who was
or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in
the right of the Corporation), by reason of the fact that he is or was a
director, officer, employee or agent of the Corporation, or is or was
serving at the request of the Corporation as a director, officer,
employee or agent of another corporation or of a partnership, joint
venture, trust or other enterprise, to the fullest extent permitted
under Article Eight of
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the Articles of Incorporation of the Corporation or the BCA, as the same
existed on the date of incorporation of the Corporation or may thereafter be
amended (but in the case of amendment, only to the extent that such amendment
permits the Corporation to provide broader indemnification rights
than the Articles of Incorporation or the BCA permitted the
Corporation to provide prior to such amendment) against all expenses
(including attorneys' fees), judgments, fines, and amounts paid or to
be paid in settlement actually and reasonably incurred or suffered by
such person in connection with such action, suit or proceeding, if such
person acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Corporation, and,
with respect to any criminal action or proceeding, had no reasonable
cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction,
or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith
and in a manner which he reasonably believed to be in or not
opposed to the best interests of the Corporation or, with respect to
any criminal action or proceeding, that the person had reasonable
cause to believe that his conduct was unlawful.
6.1.2. The Corporation shall indemnify any person who was
or is a party or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of the
Corporation to procure a judgment in its favor by reason of the fact
that such person is or was a director, officer, employee or agent of the
Corporation, or is or was serving at the request of the Corporation as
a director, officer, employee or agent of another corporation or of a
partnership, joint venture, trust or other enterprise, to the fullest
extent permitted under Article Eight of the Articles of Incorporation
of the Corporation or the BCA, as the same existed on the date of
incorporation of the Corporation or may thereafter be amended (but
in the case of amendment, only to the extent that such amendment
permits the Corporation to provide broader indemnification rights
than the Articles of Incorporation or the BCA permitted the
Corporation to provide prior to such amendment) against all expenses
(including attorneys' fees) actually and reasonably incurred by such
person in connection with the defense or settlement of such action or
suit, if such person acted in good faith and in a manner he reasonably
believed to be in or not
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opposed to the best interests of the Corporation, provided that no
indemnification shall be made with respect to any claim, issue or matter as
to which such person shall have been adjudged to have been liable to the
Corporation, unless, and only to the extent that, the court in which such
action or suit was brought shall determine upon application that, despite
the adjudication of liability, but in view of all the circumstances of the
case, such person is fairly and reasonably entitled to indemnity for
such expenses as the court shall deem proper.
6.1.3. To the extent that a director, officer, employee or
agent of the Corporation has been successful, on the merits or
otherwise, in the defense of any action, suit or proceeding referred to
in subsection 6.1.1. or subsection 6.1.2., or in defense of any claim,
issue or matter therein, such person shall be indemnified against
expenses (including attorneys' fees) actually and reasonably incurred
by such person in connection therewith.
Section 6.2.
Determination of Indemnification
Any indemnification or advancement of expenses under this
Article VI (unless ordered by a court) shall be made by the
Corporation only as authorized as provided by Section 8.75(d) or
Section 8.75(e) of the BCA, as then amended, or any successor
provisions, within 30 days of a request for indemnification.
Section 6.3.
Advancement of Expenses
Expenses actually and reasonably incurred in defending a civil
or criminal action, suit or proceeding referred to in subsection 6.1.1.
or subsection 6.1.2. shall be paid by the Corporation in advance of the
final disposition of such action, suit or proceeding, upon receipt of an
undertaking by or on behalf of the director, officer, employee or agent
to repay such amount, if it shall ultimately be determined that he is
not entitled to be indemnified by the Corporation as authorized in
this Article VI.
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Section 6.4.
Non-Exclusivity
The indemnification and advancement of expenses provided
by or granted under this Article VI shall not be deemed exclusive of
any other rights to which those seeking indemnification or
advancement of expenses may be entitled under the Articles of
Incorporation or any agreement, vote of shareholders or disinterested
directors or otherwise, both as to action in his official capacity and as
to action in another capacity while holding such office, and shall,
unless otherwise provided when authorized or ratified, continue as to
a person who has ceased to be a director, officer, employee or agent,
and shall inure to the benefit of the heirs, executors and
administrators of that person.
Section 6.5.
Certain Definitions
6.5.1. For purposes of this Article VI, references to the
"Corporation" shall include, in addition to the surviving corporation,
any constituent corporation (including any constituent of a constituent
corporation) absorbed in a consolidation or merger which, if its
separate existence had continued, would have had the power and
authority to indemnify its directors, officers, and employees or agents,
so that any person who is or was or who has agreed to become a
director, officer, employee or agent of such constituent corporation, or
is or was serving or has agreed to serve at the request of such
constituent corporation as a director, officer, employee or agent of
another corporation or of a partnership, joint venture, trust or other
enterprise, shall stand in the same position under the provisions of
this Article VI with respect to the resulting or surviving corporation
as such person would have with respect to such constituent
corporation if its separate existence had continued.
6.5.2. For purposes of this Article VI, any reference to "other
enterprises" shall include employee benefit plans; references to "fines"
shall include any excise taxes assessed on a person with respect to an
employee benefit plan; and references to "serving at the request of the
Corporation" shall include any service as a director, officer, employee
or agent of the Corporation which imposes duties on, or involves
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services by, such director, officer, employee or agent with respect to
an employee benefit plan, its participants or beneficiaries, including,
without limitation, serving as a trustee or other fiduciary of an
employee benefit plan. A person who acted in good faith and in a
manner he reasonably believed to be in the best interests of the
participants and beneficiaries of an employee benefit plan shall be
deemed to have acted in a manner "not opposed to the best interests
of the Corporation" as referred to in this Article VI.
Section 6.6.
Insurance
The Corporation may purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or
agent of the Corporation, or who is or was serving at the request of
the Corporation as a director, officer, employee or agent of another
corporation or of a partnership, joint venture, trust or other
enterprise, against any liability asserted against such person and
incurred by such person in any such capacity, or arising out of his
status as such, whether or not the Corporation would have the power
to indemnify such person against such liability under Section 8.75 of
the BCA or otherwise.
Section 6.7.
Reports
If the Corporation has paid indemnity or has advanced
expenses to a director, officer, employee or agent, the Corporation
shall report the indemnification or advance in writing to the
shareholders with or before the notice of the next shareholders
meeting.
Section 6.8.
Contract with the Corporation
The provisions of this Article VI shall be deemed to be a
contract between the Corporation and each director, officer, employee
or agent who serves in any capacity referred to in Section 6.1 at any
time while this Article is in effect; and any repeal or modification of
this Article VI or any repeal or
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modification of the relevant provisions of the BCA or any other applicable
law shall not in any way diminish any rights to indemnification or
advancement of expenses with respect to any state of facts then or previously
existing or any action, suit or proceeding previously or thereafter brought or
threatened based in whole or in part upon any such state of facts.
ARTICLE VII
CHECKS, CONTRACTS, LOANS AND BANK ACCOUNTS
Section 7.1.
Checks, Drafts, etc.
7.1.1. All checks, drafts, bills of exchange or other orders for
the payment of money, obligations, notes, or other evidences of
indebtedness, bills of lading, warehouse receipts and insurance
certificates of the Corporation shall be signed or endorsed as the
Board may direct.
7.1.2. The Board may from time to time authorize facsimile
signatures of the officers of the Corporation to be utilized in lieu of
manual signatures.
Section 7.2.
Contracts
The Board may authorize one or more officers, agents or
employees of the Corporation to enter into any contract or execute
and deliver any contract or other instrument in the name and on
behalf of the Corporation, and such authority may be general or
confined to specific instances; provided, however, that this Section 7.2
shall not be a limitation on the powers of office granted under
Article V of these by-laws.
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Section 7.3.
Loans
No loan shall be contracted on behalf of the Corporation and
no evidence of indebtedness shall be issued in the Corporation's name
unless it is authorized by a resolution of the Board. Such authority
may be general or confined to specific instances.
Section 7.4.
Deposits
All funds of the Corporation shall be deposited from time to
time to the credit of the Corporation in such general or special bank
account or accounts in such banks, trust companies or other
depositaries as the Board, the Chief Executive Officer, the President,
the Chief Financial Officer or the Treasurer may from time to time
designate; and the Board may make such general or special rules and
regulations with respect thereto, not inconsistent with the provision of
these by-laws, as it may deem expedient.
ARTICLE VIII
SHARES AND THEIR TRANSFER
Section 8.1.
Certificates of Stock
8.1.1. The interest of each shareholder of the Corporation
shall be evidenced by a certificate or certificates for shares of stock in
such form as, subject to the laws of the State of Illinois, the Board of
Directors may from time to time prescribe.
8.1.2. Certificates of stock shall be signed by the Chief
Executive Officer or President or a Vice President and by the
Secretary or an Assistant Secretary or the Treasurer or an Assistant
Treasurer, which signatures may be by facsimile on any certificate
countersigned by a transfer agent or registered by a registrar (other
than the Corporation itself).
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8.1.3. In case any officer who has signed or whose facsimile
signature has been placed upon a certificate shall have ceased to be an
officer before such certificate is issued, the Certificates may be issued
by the Corporation with the same effect as if he were an officer at the
date of issuance.
Section 8.2.
Transfer of Stock
8.2.1. Transfers of shares of stock of the Corporation shall be
made on payment of all taxes thereon and presentment to the
Corporation or its transfer agent for cancellation of the certificate or
certificates for such shares (except as hereinafter provided in the case
of loss, destruction, theft or mutilation of certificates) properly
endorsed by the registered holder thereof or accompanied by proper
evidence of succession, assignment or authority to transfer, together
with such reasonable assurance as the Corporation or its transfer
agent may require that the said endorsement is genuine and effective.
8.2.2. A person in whose name shares of stock are registered
on the books of the Corporation shall be deemed the owner thereof
by the Corporation, and, upon any transfer of shares, the person or
persons into whose name or names such shares shall be transferred
shall be substituted for the person or persons out of whose name or
names such shares shall have been transferred, with respect to all
rights, privileges and obligations of holders of stock of the
Corporation as against the Corporation or any other person or
persons.
Section 8.3.
Lost, Destroyed, Stolen and Mutilated Certificates
8.3.1 The holder of any stock of the Corporation shall
immediately notify the Corporation of any loss, destruction, theft or
mutilation of the certificate for any such stock, and the Board may, in
its discretion, cause to be issued to him a new certificate or
certificates of stock upon the surrender of the mutilated certificate, or
in case of loss, destruction or theft, upon satisfactory proof of such
loss, destruction or theft; and, the Board may, in its discretion, require
the owner of the lost, destroyed or stolen certificate, or his legal
representative, to give the Corporation a bond in such sum and in
such form
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and with such surety or sureties as it may direct, to indemnify the
Corporation against any claim that may be made against it with respect
to the certificate or certificates alleged to have been lost, destroyed
or stolen.
8.3.2. The powers hereinabove vested in the Board may be
delegated by it to any officer or officers of the Corporation.
Section 8.4.
Transfer Agent and Registrar and Regulations
8.4.1. The Corporation shall, if and whenever the Board shall
so determine, maintain one or more transfer offices or agencies, each
in the charge of a transfer agent designated by the Board, where the
shares of the stock of the Corporation shall be directly transferable,
and also one or more registry offices, each in the charge of a registrar
designated by the Board, where such shares of stock shall be
registered, and no certificate for shares of stock of the Corporation in
respect of which a transfer agent and registrar shall have been
designated shall be valid unless countersigned by such transfer agent
and registered by such registrar. The Board may appoint the same
person to be the transfer agent and the registrar.
8.4.2. The Board may also make such additional rules and
regulations as it may deem expedient concerning the issue, transfer
and registration of certificates for shares of the stock of the
Corporation.
8.4.3. The Corporation may itself, at the discretion of the
Board, act as transfer agent in such a manner as the Board shall
direct.
Section 8.5.
Record Date
8.5.1. For the purpose of determining the shareholders
entitled to notice of or to vote at any meeting of shareholders or any
adjournment thereof, or to express consent to corporate action in
writing without a meeting, or to receive payment of any dividend or
other distribution or allotment or any rights, or to exercise any rights
in respect of any change, conversion or exchange of shares, or for the
purpose of determining shareholders for any other lawful reason, the
Board may fix in advance a record date which
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shall not be more than sixty (60) days and, for a meeting of shareholders,
not less than ten (10) days, or in the case of a merger, consolidation,
share exchange, dissolution or sale, lease or exchange of assets, not less
than twenty (20) days, before the date of such meeting.
8.5.2 If no record date is fixed, the record date for the
determination of shareholders entitled to notice of or to vote at a
meeting of shareholders shall be the date on which notice of the
meeting is mailed, and the record date for the determination of
shareholders for any other purpose shall be the date on which the
Board adopts the resolution relating thereto. A determination of
shareholders of record entitled to notice of or to vote at any meeting
of shareholders shall apply to any adjournment of the meeting.
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.1.
Seal
The corporate seal shall have inscribed thereon the name of
the Corporation and such other appropriate legend as the Board may
from time to time determine. In lieu of the corporate seal, when so
authorized by the Board or a duly empowered committee thereof and
permitted by law, a facsimile thereof may be impressed or affixed or
reproduced.
Section 9.2.
Fiscal Year
The fiscal year of the Corporation shall end on December 31
of each calendar year.
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Section 9.3.
Notices
9.3.1. Any notice required by these by-laws, or otherwise, to
be given shall be deemed to have been given in person if delivered in
person to the person to whom such notice is addressed, and shall be
deemed to have been given by mail to any persons entitled thereto at
the time if shall have been deposited in the United States mail,
enclosed in a postage prepaid envelope, and shall be deemed to have
been given by wire or wireless communication media when the same
shall have been delivered for prepaid transmission into the custody of
a company ordinarily engaged in the transmission of such messages;
such postage prepaid envelope or such wire or wireless
communication message being addressed to such person at his address
as it appears on the books and records of the Corporation, or if no
address appears on such books and records of the Corporation, then
at such address as shall be otherwise known to the Secretary, or if no
such address appears on such books and records or is otherwise
known to the Secretary, then in care of the registered agent of the
Corporation in the State of Illinois.
9.3.2. Whenever, by any provisions of the Articles of
Incorporation or these by-laws, or otherwise. any notice is required to
be given any specified number of days before any meeting or event,
the day on which such notice was given shall be counted, but the day
of such meeting or other event shall not be counted, in determining
whether or not notice has been given in proper time in a particular
case.
Section 9.4.
Waiver of Notice
9.4.1. Whenever any notice is required to be given under the
provisions of the laws of the State of Illinois, the Articles of
Incorporation or these by-laws, a waiver thereof in writing, signed by
the person entitled to such notice, or his proxy in the case of a
shareholder whether before or after the time stated therein, shall be
deemed equivalent thereto.
9.4.2. Except as may be otherwise specifically provided by
law, any waiver by mail, wire or wireless communication media,
bearing the name of the person entitled to notice shall be deemed a
waiver in writing duly signed.
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9.4.3. The presence of any shareholder at any meeting, either
in person or by proxy, without protesting in writing prior to the
conclusion of the meeting the lack of notice of such meeting, shall
constitute a waiver of notice by him.
9.4.4. Attendance by a director at any meeting of the Board
shall constitute a waiver of notice by him of such meeting except
where a director attends the meeting for the express purpose of
objecting to the transaction of any business because the meeting was
not lawfully convened or held.
Section 9.5.
Resignations
9.5.1. Any officer or director may resign at any time by giving
written notice to the Chairman, the Chief Executive Officer, the
President or the Secretary. Such resignation shall take effect at the
time specified in the notice.
9.5.2. Unless otherwise specified in any notice of resignation,
the acceptance of such resignation shall not be necessary to make it
effective.
9.5.3. No resignation of an officer or director shall serve to
release the person submitting it from any liability or duty to the
Corporation, whether created by law, the Articles of Incorporation,
these by-laws, a resolution or directive of the Board or under any
contract between such person and the Corporation, unless the Board
shall expressly and specifically release such person from any such
liability or duty.
Section 9.6.
Destruction of Records
In the event of destruction of the original records of the
Corporation as a result of any disaster, the most authentic available
duplicate form of the records shall be the official records in lieu of
the records destroyed, and the officers of the Corporation are
authorized to reconstruct the destroyed records from such duplicates.
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Section 9.7.
Simultaneous Death or Incapacitation of Directors
In the event of the simultaneous death or inability to act of a
majority of the directors of the Corporation, the Board shall
temporarily consist of the surviving directors of the Corporation.
Such Board shall immediately elect temporary directors of the
Corporation to fill vacancies, reconstruct any records which may have
been destroyed and call a meeting of shareholders to elect a Board.
ARTICLE X
INTERPRETATION, SEVERABILITY AND AMENDMENTS
Section 10.1.
Interpretation
Titles and headings to Articles and Sections herein are
inserted for convenience of reference only and are not intended to be
a part of or to affect the meaning or interpretation of these by-laws.
Whenever from the context it appears appropriate, each term stated
in either the singular or the plural shall include the singular and the
plural, and pronouns stated in the masculine gender shall include the
masculine, the feminine and the neuter genders.
Section 10.2.
Severability
If any provision of these by-laws, or its application to any
person or circumstance is held invalid the remainder of these by-laws
and the application of such provision to other persons or
circumstances shall not be affected thereby.
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Section 10.3.
Amendments
These by-laws may be altered, amended or repealed by the
affirmative vote of not less than seventy-five percent (75%) of the
Directors then qualified or by the shareholders of the Corporation
entitled to vote thereon. The by-laws may contain any provisions for
the regulation and management of the affairs of the Corporation not
inconsistent with law or the Articles of Incorporation.
Exhibit 10.1
SEVERANCE AGREEMENT
THIS AGREEMENT is entered into as of the 16th day of
September, 1994 by and between Joslyn Corporation, an Illinois
corporation, and Lawrence G. Wolski (the "Executive").
W I T N E S S E T H
WHEREAS, the Executive currently serves as a key
employee of the Company (as defined in Section 1) and his
services and knowledge are valuable to the Company in connection
with the management of one or more of the Company's principal
operating facilities, divisions, departments or subsidiaries; and
WHEREAS, the Board (as defined in Section 1) has
determined that it is in the best interests of the Company and
its shareholders to secure the Executive's continued services and
to ensure the Executive's continued dedication and objectivity in
the event of any threat or occurrence of, or negotiation or other
action that could lead to, or create the possibility of, a Change
in Control (as defined in Section 1) of the Company, without
concern as to whether the Executive might be hindered or
distracted by personal uncertainties and risks created by any
such possible Change in Control, and to encourage the Executive's
full attention and dedication to the Company, the Board has
authorized the Company to enter into this Agreement.
NOW, THEREFORE, for and in consideration of the
premises and the mutual covenants and agreements herein
contained, the Company and the Executive hereby agree as follows:
1. Definitions. As used in this Agreement, the
following terms shall have the respective meanings set forth
below:
(a) "Board" means the Board of Directors of the
Company.
(b) "Bonus Plan" means the Executive Management
Incentive Plan of Joslyn Corporation, or any plan of an
affiliated company of the Company intended to provide similar
benefits, or any of their successor plans.
(c) "Cause" means (1) a material breach by the
Executive of those duties and responsibilities of the Executive
which do not differ in any material respect from the duties and
responsibilities of the Executive during the 90-day period
immediately prior to a Change in Control (other than as a result
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of incapacity due to physical or mental illness) which is
demonstrably willful and deliberate on the Executive's part,
which is committed in bad faith or without reasonable belief that
such breach is in the best interests of the Company and which is
not remedied in a reasonable period of time after receipt of
written notice from the Company specifying such breach or (2) the
commission by the Executive of a felony involving moral
turpitude.
(d) "Change in Control" means:
(1) the acquisition by any individual, entity or group
(a "Person"), including any "person" within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act (hereinafter
defined), of beneficial ownership within the meaning of Rule 13d-
3 promulgated under the Exchange Act, of 25% or more of either
(i) the then outstanding common shares of the Company (the
"Outstanding Company Common Shares") or (ii) the combined voting
power of the then outstanding securities of the Company entitled
to vote generally in the election of directors (the "Outstanding
Company Voting Securities"); provided, however, that the
following acquisitions shall not constitute a Change in Control:
(A) any acquisition directly from the Company (excluding any
acquisition resulting from the exercise of a conversion or
exchange privilege in respect of outstanding convertible or
exchangeable securities), (B) any acquisition by the Company, (C)
any acquisition by an employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation
controlled by the Company, or (D) any acquisition by any
corporation pursuant to a reorganization, merger or consolidation
involving the Company, if, immediately after such reorganization,
merger or consolidation, each of the conditions described in
clauses (i), (ii) and (iii) of subsection (3) of this Section 1
(d) shall be satisfied; and provided further that, for purposes
of clause (B), if any Person (other than the Company or any
employee benefit plan (or related trust) sponsored or maintained
by the Company or any corporation controlled by the Company)
shall become the beneficial owner of 25% or more of the
Outstanding Company Common Shares or 25% or more of the
Outstanding Company Voting Securities by reason of an acquisition
by the Company and such Person shall, after such acquisition by
the Company, become the beneficial owner of any additional shares
of the Outstanding Company Common Shares or any additional
Outstanding Voting Securities and such beneficial ownership is
publicly announced, such additional beneficial ownership shall
constitute a Change in Control;
(2) individuals who, as of the date hereof,
constitute the Board (the "Incumbent Board") cease for any reason
to constitute at least a majority of such Board; provided,
however, that any individual who becomes a director of the
Company subsequent to the date hereof whose election, or
nomination for election by the Company's shareholders, was
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approved by the vote of at least a majority of the directors then
comprising the Incumbent Board shall be deemed to have been a
member of the Incumbent Board; and provided further, that no
individual who was initially elected as a director of the Company
as a result of an actual or threatened election contest, as such
terms are used in Rule 14a-11 of Regulation 14A promulgated under
the Exchange Act, or any other actual or threatened solicitation
of proxies or consents by or on behalf of any Person other than
the Board shall be deemed to have been a member of the Incumbent
Board;
(3) approval by the shareholders of the Company of a
reorganization, merger or consolidation unless, in any such case,
immediately after such reorganization, merger or consolidation,
(i) more than 60% of the then outstanding shares of common stock
of the corporation resulting from such reorganization, merger or
consolidation and more than 60% of the combined voting power of
the then outstanding securities of such corporation entitled to
vote generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of the
individuals or entities who were the beneficial owners,
respectively, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities immediately prior to such
reorganization, merger or consolidation and in substantially the
same proportions relative to each other as their ownership,
immediately prior to such reorganization, merger or
consolidation, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities, as the case may be, (ii)
no Person (other than the Company, any employee benefit plan (or
related trust) sponsored or maintained by the Company or the
corporation resulting from such reorganization, merger or
consolidation (or any corporation controlled by the Company) and
any Person which beneficially owned, immediately prior to such
reorganization, merger or consolidation, directly or indirectly,
25% or more of the Outstanding Company Common Shares or the
Outstanding Company Voting Securities, as the case may be)
beneficially owns, directly or indirectly, 25% or more of the
then outstanding shares of common stock of such corporation or
25% or more of the combined voting power of the then outstanding
securities of such corporation entitled to vote generally in the
election of directors and (iii) at least a majority of the
members of the board of directors of the corporation resulting
from such reorganization, merger or consolidation were members of
the Incumbent Board at the time of the execution of the initial
agreement or action of the Board providing for such
reorganization, merger or consolidation; or
(4) approval by the shareholders of the Company of (i)
a plan of complete liquidation or dissolution of the Company or
(ii) the sale or other disposition of all or substantially all of
the assets of the Company other than to a corporation with
respect to which, immediately after such sale or other
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disposition, (A) more than 60% of the then outstanding shares of
common stock thereof and more than 60% of the combined voting
power of the then outstanding securities thereof entitled to vote
generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities immediately prior to such
sale or other disposition and in substantially the same
proportions relative to each other as their ownership,
immediately prior to such sale or other disposition, of the
Outstanding Company Common Shares and the Outstanding Company
Voting Securities, as the case may be, (B) no Person (other than
the Company, any employee benefit plan (or related trust)
sponsored or maintained by the Company or such corporation (or
any corporation controlled by the Company) and any Person which
beneficially owned, immediately prior to such sale or other
disposition, directly or indirectly, 25% or more of the
Outstanding Company Common Shares or the Outstanding Company
Voting Securities, as the case may be) beneficially owns,
directly or indirectly, 25% or more of the then outstanding
shares of common stock thereof or 25% or more of the combined
voting power of the then outstanding securities thereof entitled
to vote generally in the election of directors and (C) at least a
majority of the members of the board of directors thereof were
members of the Incumbent Board at the time of the execution of
the initial agreement or action of the Board providing for such
sale or other disposition.
(e) "Code" means the Internal Revenue Code of 1986, as
amended.
(f) "Company" means Joslyn Corporation, an Illinois
corporation.
(g) "Date of Termination" means (1) the effective date
on which the Executive's employment by the Company terminates as
specified in a prior written notice by the Company or the
Executive, as the case may be, to the other, delivered pursuant
to Section 11 or (2) if the Executive's employment by the Company
terminates by reason of death, the date of death of the
Executive.
(h) "Exchange Act" means the Securities Exchange Act
of 1934, as amended.
(i) "Good Reason" means, without the Executive's
express written consent, the occurrence of any of the following
events after a Change in Control:
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(1) any of (i) the assignment to the Executive of any
duties inconsistent in any material respect with the Executive's
position(s), duties, responsibilities or status with the Company
immediately prior to such Change in Control, (ii) a change in the
Executive's reporting responsibilities, titles or offices with
the Company as in effect immediately prior to such Change in
Control or (iii) any removal or involuntary termination of the
Executive from the Company otherwise than as expressly permitted
by this Agreement or any failure to re-elect the Executive to any
position with the Company held by the Executive immediately prior
to such Change in Control;
(2) a reduction by the Company in the Executive's rate
of annual base salary as in effect immediately prior to such
Change in Control or as the same may be increased from time to
time thereafter or the failure by the Company to increase such
rate of base salary each year after such Change in Control by an
amount which at least equals the annual percentage increase, if
any, in the Consumer Price Index for All Items For All Urban
Consumers respecting the metropolitan area closest to the
Executive's place of residence as reported by the United States
Department of Labor, Bureau of Labor Statistics;
(3) any requirement of the Company that the Executive
have a regular work site located more than 50 miles from the
regular work site of the Executive at the time of the Change in
Control;
(4) the failure of the Company to (i) continue in
effect any employee benefit plan or compensation plan in which
the Executive is participating immediately prior to such Change
in Control, unless the Executive is permitted to participate in
other plans providing the Executive with substantially comparable
benefits, or the taking of any action by the Company which would
adversely affect the Executive's participation in or materially
reduce the Executive's benefits under any such plan, (ii) provide
the Executive and the Executive's dependents welfare benefits
(including, without limitation, medical, prescription, dental,
disability, salary continuance, employee life, group life,
accidental death and travel accident insurance plans and
programs) in accordance with the most favorable plans, practices,
programs and policies of the Company and its affiliated companies
in effect for the Executive immediately prior to such Change in
Control or, if more favorable to the Executive, as in effect
generally at any time thereafter with respect to other peer
executives of the Company and its affiliated companies, (iii)
provide fringe benefits in accordance with the most favorable
plans, practices, programs and policies of the Company and its
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affiliated companies in effect for the Executive immediately
prior to such Change in Control or, if more favorable to the
Executive, as in effect generally at any time thereafter with
respect to other peer executives of the Company and its
affiliated companies, (iv) provide the Executive with paid
vacation in accordance with the most favorable plans, policies,
programs and practices of the Company and its affiliated
companies as in effect for the Executive immediately prior to
such Change in Control or, if more favorable to the Executive, as
in effect generally at any time thereafter with respect to other
peer executives of the Company and its affiliated companies, or
(v) reimburse the Executive promptly for all reasonable
employment expenses incurred by the Executive in accordance with
the most favorable policies, practices and procedures of the
Company and its affiliated companies in effect for the Executive
immediately prior to such Change in Control, or if more favorable
to the Executive, as in effect generally at any time thereafter
with respect to other peer executives of the Company and its
affiliated companies; or
(5) the failure of the Company to obtain the
assumption agreement from any successor as contemplated in
Section 10(b).
For purposes of this Agreement, any good faith
determination of Good Reason made by the Executive shall be
conclusive; provided, however, that an isolated, insubstantial
and inadvertent action taken in good faith and which is remedied
by the Company promptly after receipt of notice thereof given by
the Executive shall not constitute Good Reason.
(j) "Nonqualifying Termination" means a termination of
the Executive's employment (1) by the Company for Cause, (2) by
the Executive for any reason other than a Good Reason, (3) as a
result of the Executive's death or (4) by the Company due to the
Executive's absence from his duties with the Company on a full-
time basis for at least 180 consecutive days as a result of the
Executive's incapacity due to physical or mental illness;
provided, however, that a termination of the Executive's
employment by the Executive for any reason whatsoever during the
"Window Period" (hereinafter defined) shall not constitute a
Nonqualifying Termination.
(k) "Parity Plan" means the Parity Compensation Plan
of Joslyn Corporation, or any plan of an affiliated company of
the Company intended to provide similar benefits, or any of their
successor plans.
(l) "Profit Sharing Plan" means the Employees' Savings
and Profit Sharing Plan of Joslyn Corporation, or any plan of an
affiliated company of the Company intended to provide similar
benefits, or any of their successor plans.
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(m) "Termination Period" means the period of time
beginning with a Change in Control and ending on the earliest to
occur of (1) the Executive's 70th birthday, (2) the Executive's
death, and (3) two years following such Change in Control.
(n) "Termination Year Bonus" shall have the meaning
set forth in Section 3(a)(1).
(o) "Termination Year Parity Amount" shall have the
meaning set forth in Section 3(a)(1).
(p) "Termination Year Profit Sharing Amount" shall
have the meaning set forth in Section 3(a)(1).
(q) "Window Period" means the 30-day period commencing
one year after the date of a Change in Control.
2. Obligations of the Executive. The Executive
agrees that in the event any person or group attempts a Change in
Control, he shall not voluntarily leave the employ of the Company
without Good Reason (a) until such attempted Change in Control
terminates or (b) if a Change in Control shall occur, until 90
days following such Change in Control. For purposes of the
foregoing subsection (a), Good Reason shall be determined as if a
Change in Control had occurred when such attempted Change in
Control became known to the Board.
3. Payments Upon Termination of Employment.
(a) If during the Termination Period the employment of
the Executive shall terminate, other than by reason of a
Nonqualifying Termination, then the Company shall pay to the
Executive (or the Executive's beneficiary or estate), as
compensation for services rendered to the Company:
(1) within 30 days following the Date of Termination,
a lump-sum cash amount equal to the sum of:
(i) the Executive's full annual base salary from the
Company and its affiliated companies through the Date of
Termination, to the extent not theretofore paid,
(ii) the Executive's Award Payment at 100% of Plan
Accomplishment level under the Bonus Plan (one-half maximum
potential award), for the full fiscal year in which the Date of
Termination occurs, calculated in accordance with the terms of
the Bonus Plan as in effect immediately prior to the Change in
Control or as in effect on the Date of Termination, whichever
results in a greater amount, as if a Change in Control had not
occurred, the Executive were employed by the Company at the end
of the such fiscal year and all other conditions necessary for
the payment by the Company of such bonus were satisfied (the
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"Termination Year Bonus"), multiplied by a fraction, the
numerator of which is the number of days in the fiscal year in
which the Date of Termination occurs through the Date of
Termination and the denominator of which is 365 or 366, as
applicable, reduced by the amount otherwise payable pursuant to
the terms of the Bonus Plan for such plan year;
(iii) the Executive's Parity Compensation payment as
determined under the Parity Plan, for the full fiscal year in
which the Date of Termination occurs, calculated in accordance
with the terms of the Parity Plan as in effect immediately prior
to the Change in Control or as in effect on the Date of
Termination, whichever results in a greater amount, as if a
Change in Control had not occurred, the Executive were employed
by the Company at the end of such fiscal year, the Executive had
received the Termination Year Bonus and all other conditions
necessary for the payment by the Company of such Parity
Compensation payment were satisfied (the "Termination Year Parity
Amount"), multiplied by a fraction, the numerator of which is the
number of days in the fiscal year in which the Date of
Termination occurs through the Date of Termination and the
denominator of which is 365 or 366, as applicable, reduced by the
amount otherwise payable pursuant to the terms of the Parity Plan
for such plan year;
(iv) the maximum Profit Sharing Contribution for the
Executive under the Profit Sharing Plan, for the full fiscal year
in which the Date of Termination occurs, calculated in accordance
with the terms of the Profit Sharing Plan as in effect
immediately prior to the Change in Control or as in effect on the
Date of Termination, whichever results in a greater amount, as if
a Change in Control had not occurred, the Executive were employed
by the Company at the end of such fiscal year, the Executive had
received the Termination Year Bonus and all other conditions
necessary for the payment by the Company of such Profit Sharing
Contribution were satisfied (the "Termination Year Profit Sharing
Amount"), multiplied by a fraction, the numerator of which is the
number of days in the fiscal year in which the Date of
Termination occurs through the Date of Termination and the
denominator of which is 365 or 366, as applicable, reduced by the
amount otherwise allocated to the Executive's account under the
Profit Sharing Plan pursuant to the terms of the Profit Sharing
Plan for such plan year as determined at the Date of Termination;
and
(v) any compensation previously deferred by the
Executive (together with any interest and earnings thereon) and
any accrued vacation pay, in each case to the extent not
theretofore paid; plus
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(2) within 30 days following the Date of Termination,
unless such payment date is extended pursuant to Section 4, in
which case such payment date may not be extended beyond 90 days
following the Date of Termination, a lump-sum cash amount in an
amount equal to the sum of (i) two and one-half (2.5) times the
Executive's highest annual base salary from the Company and its
affiliated companies in effect during the 12-month period prior
to the Date of Termination, (ii) two and one-half (2.5) times the
Executive's full Termination Year Bonus, (iii) two and one-half
(2.5) times the Executive's full Termination Year Parity Amount,
and (iv) two and one-half (2.5) times the Executive's full
Termination Year Profit Sharing Amount; provided, however, that
any amount paid pursuant to this Section 3(a)(2) may be reduced
in accordance with the provisions of Section 4; provided further,
that in the event there are fewer than 30 whole months remaining
from the Date of Termination to the date of the Executive's 70th
birthday, the amount calculated in accordance with this Section
3(a)(2) shall be reduced by multiplying such amount by a fraction
the numerator of which is the number of months, including a
partial month (with a partial month being expressed as a fraction
the numerator of which is the number of days remaining in such
month and the denominator of which is the number of days in such
month), so remaining and the denominator of which is 30; and
provided further, that, except as otherwise provided in this
Agreement, any amount paid pursuant to this Section 3(a)(2) shall
be paid in lieu of any other amount of severance relating to
salary or bonus continuation to be received by the Executive upon
termination of employment of the Executive under any severance
plan, employment agreement, policy or arrangement of the Company
applicable to the Executive, other than amounts to be received by
the Executive upon termination of employment of the Executive
under the Bonus Plan, the Parity Plan or the Profit Sharing Plan.
(b) (1) In addition to the payments to be made
pursuant to paragraph (a) of this Section 3, if on the Date of
Termination the Executive shall not be fully vested in any
employer contributions or earnings thereon made on his behalf
under the Profit Sharing Plan, the Company shall pay to the
Executive within 30 days following the Date of Termination a lump
sum cash amount equal to the value of the unvested portion of
such employer contributions and earnings; provided, however, that
if any payment pursuant to this Section 3(b)(1) may or would
result in such payment being deemed a transaction which is
subject to Section 16(b) of the Exchange Act, the Company shall
make such payment so as to meet the conditions for an exemption
from such Section 16(b) as set forth in the rules (and
interpretive and no-action letters relating thereto) under
Section 16. The value of any such unvested employer
contributions and earnings shall be determined in accordance with
the terms of the Profit Sharing Plan.
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(2) For a period of two and one-half (2.5) years
commencing on the Date of Termination, the Company shall continue
to keep in full force and effect all medical, dental, accident
and life insurance plans with respect to the Executive and his
dependents with the same level of coverage, upon the same terms
and otherwise to the same extent as such plans shall have been in
effect immediately prior to the Date of Termination.
Notwithstanding the foregoing sentence, if any of the medical,
dental, accident or life insurance plans then in effect generally
with respect to other peer executives of the Company and its
affiliated companies would be more favorable to the Executive,
such plan coverage shall be substituted for the analogous plan
coverage provided to the Executive immediately prior to the Date
of Termination, and the Company and the Executive shall share the
costs of such plan coverage in the same proportion as such costs
were shared immediately prior to the Date of Termination. The
obligation of the Company to continue coverage of the Executive
and the Executive's dependents under such plans shall cease at
such time as the Executive and the Executive's dependents obtain
comparable coverage under another plan, including a plan
maintained by a new employer. Execution of this Agreement by the
Executive shall not be considered a waiver of any rights or
entitlements the Executive and the Executive's dependents may
have under applicable law to continuation of coverage under the
group medical plan maintained by the Company or its affiliated
companies.
(3) If the Executive shall be at least 50 years of age
and the sum of the Executive's age and years of service with the
Company is at least 75 at (i) the termination of medical coverage
provided by Section 3(b)(2) hereof, (ii) the termination of the
severance continuation under the Company's Group Medical coverage
or (iii) the end of any COBRA continuation of Group Medical
coverage, the Company shall provide the Executive with the
ability to elect Group Medical coverage for the Executive and the
Executive's dependents; provided, that the maximum continuation
period of such coverage shall be until age 65 for the Executive
and any covered spouse, and in accordance with the provisions of
the Company's Group Medical Plan for covered children. The
extended continuation of Group Medical coverage described in the
previous sentence shall be subject to the provisions of the
Company's Group Medical Plan and a required contribution fee
equal to the rate for Early Retiree's under the Company's Retiree
Medical Plan for Plan "A" coverage, or for Plan "B" coverage, the
Early Retiree Rate less the difference between the Plan "A" and
Plan "B" contribution rates for active employees.
(4) The Company shall reimburse the Executive for 90%
of the Executive's expenditures for obtaining outplacement
services, provided that the Company shall have no obligation to
reimburse the Executive in an amount which exceeds 10% of the
Executive's highest annual base salary from the Company and its
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affiliated companies in effect during the 12-month period prior
to the Date of Termination.
(c) If during the Termination Period the employment of
the Executive shall terminate by reason of a Nonqualifying
Termination, then the Company shall pay to the Executive within
30 days following the Date of Termination, a lump-sum cash amount
equal to the sum of (1) the Executive's full annual base salary
from the Company through the Date of Termination, to the extent
not theretofore paid and (2) any compensation previously deferred
by the Executive (together with any interest and earnings
thereon) and any accrued vacation pay, in each case to the extent
not theretofore paid.
4. Excess Parachute Payments. (a) Anything in this
Agreement to the contrary notwithstanding, in the event it shall
be determined that any payment or distribution by the Company or
its affiliated companies to or for the benefit of the Executive,
whether paid or payable or distributed or distributable pursuant
to the terms of this Agreement or otherwise (in the aggregate,
"Total Payments"), would constitute an "excess parachute
payment," then Total Payments shall be reduced to be One Dollar
($1) less than the maximum amount which may be paid or
distributed to or for the benefit of the Executive without
causing the Executive to be subject to the tax imposed by Section
4999 of the Code (or any successor provision) in respect of Total
Payments or which the Company or its affiliated companies may pay
without loss of deduction under Section 280G(a) of the Code (or
any successor provision) (Total Payments, as so reduced, the
"Adjusted Total Payments"). For purposes of this Agreement, the
terms "excess parachute payment" and "parachute payments" shall
have the meanings assigned to them in Section 280G of the Code
(or any successor provision), and such "parachute payments" shall
be valued as provided therein. Present value for purposes of
this Agreement shall be calculated in accordance with Section
1274(b)(2) of the Code (or any successor provision).
(b) Within 60 days following the Date of Termination
or notice by the Company to the Executive of its reasonable
belief that there is a payment or distribution due to or for the
benefit of the Executive which would result in an excess
parachute payment, the Executive and the Company, at the
Company's expense, shall obtain the opinion (which need not be
unqualified) of nationally recognized tax counsel selected by the
Company's independent auditors and acceptable to the Executive in
his sole discretion (which may be regular outside counsel to the
Company), which opinion sets forth (A) the amount of the
Executive's Base Period Income, (B) the amount and present value
of Total Payments and (C) the amount and present value of any
excess parachute payments determined without regard to the
limitations of this Section 4. As used in this Section 4(b), the
term "Base Period Income" means the Executive's "annualized
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includible compensation for the base period" as defined in
Section 280G(d)(1) of the Code (or any successor provision). For
purposes of such opinion, the value of any noncash benefits or
any deferred payment or benefit included in Total Payments shall
be determined by the Company's independent auditors at the
Company's expense in accordance with the principles of Sections
280G(d)(3) and (4) of the Code (or any successor provisions),
which determination shall be evidenced in a certificate of such
auditors addressed to the Company and the Executive. Such
opinion shall be addressed to the Company and the Executive and
shall be binding upon the Company and the Executive. If such
opinion concludes that any Total Payments constitute an excess
parachute payment, the amount payable hereunder or any other
payment or distribution determined by such counsel in such
opinion to be includible in Total Payments shall be reduced or
eliminated as specified by the Executive in writing delivered to
the Company within 30 days of his receipt of such opinion or, if
the Executive fails to so notify the Company, then as the Company
shall reasonably determine, so that under the bases of
calculations set forth in such opinion the Total Payments shall
be the Adjusted Total Payments. If such legal counsel so
requests in connection with the opinion required by this Section
4, the Executive and the Company shall obtain, at the Company's
expense, and such legal counsel may rely on in providing the
opinion, the advice of a firm of recognized executive
compensation consultants as to the reasonableness of any item of
compensation to be paid to or for the benefit of the Executive.
If the provisions of Sections 280G and 4999 of the Code (or any
successor provisions) are repealed without succession, then this
Section 4 shall be of no further force or effect.
5. Withholding Taxes. The Company may withhold from
all payments due to the Executive (or his beneficiary or estate)
hereunder all taxes which, by applicable federal, state, local or
other law, the Company is required to withhold therefrom.
6. Reimbursement of Expenses. If any contest or
dispute shall arise under this Agreement involving termination of
the Executive's employment with the Company or involving the
failure or refusal of the Company to perform fully in accordance
with the terms hereof, the Company shall reimburse the Executive,
on a current basis, for all legal fees and expenses, if any,
incurred by the Executive in connection with such contest or
dispute, together with interest at a rate equal to the rate of
interest published in The Wall Street Journal under the caption
"Money Rates" as the prime rate, but in no event higher than the
maximum legal rate permissible under applicable law, such
interest to accrue from the date the Company receives the
Executive's statement for such fees and expenses through the date
of payment thereof; provided, however, that in the event the
resolution of any such contest or dispute includes a finding
denying, in total, the Executive's claims in such contest or
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dispute, the Executive shall be required to reimburse the
Company, over a period of 12 months from the date of such
resolution, for all sums advanced to the Executive pursuant to
this Section 6.
7. Operative Event. Notwithstanding any provision
herein to the contrary, no amounts shall be payable hereunder
unless and until there is a Change in Control at a time when the
Executive is employed by the Company.
8. Termination of Agreement. (a) This Agreement
shall be effective on the date hereof and shall continue until
terminated by the Company as provided in paragraph (b) of this
Section 8; provided, however, that this Agreement shall terminate
in any event upon the first to occur of (i) the Executive's 70th
birthday, (ii) the Executive's death and (iii) termination of the
Executive's employment with the Company prior to a Change in
Control.
(b) The Company shall have the right prior to a Change
in Control, in its sole discretion, pursuant to action by the
Board, to approve the termination of this Agreement, which
termination shall not become effective until the date fixed by
the Board for such termination, which date shall be at least 120
days after notice thereof is given by the Company to the
Executive in accordance with Section 11; provided, however, that
no such action shall be taken by the Board during any period of
time when the Board has knowledge that any person has taken steps
reasonably calculated to effect a Change in Control until, in the
opinion of the Board, such person has abandoned or terminated its
efforts to effect a Change in Control; and provided further, that
in no event shall this Agreement be terminated in the event of a
Change in Control.
9. Scope of Agreement. Nothing in this Agreement
shall be deemed to entitle the Executive to continued employment
with the Company or its subsidiaries, and if the Executive's
employment with the Company shall terminate prior to a Change in
Control, then the Executive shall have no further rights under
this Agreement; provided, however, that any termination of the
Executive's employment following a Change in Control shall be
subject to all of the provisions of this Agreement.
10. Successors; Binding Agreement. (a) This
Agreement shall not be terminated by any merger or consolidation
of the Company whereby the Company is or is not the surviving or
resulting corporation or as a result of any transfer of all or
substantially all of the assets of the Company. In the event of
any such merger, consolidation or transfer of assets, the
provisions of this Agreement shall be binding upon the surviving
or resulting corporation or the person or entity to which such
assets are transferred.
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(b) The Company agrees that concurrently with any
merger, consolidation or transfer of assets referred to in
paragraph (a) of this Section 10, it will cause any successor or
transferee unconditionally to assume, by written instrument
delivered to the Executive (or his beneficiary or estate), all of
the obligations of the Company hereunder. Failure of the Company
to obtain such assumption prior to the effectiveness of any such
merger, consolidation or transfer of assets shall be a breach of
this Agreement and shall entitle the Executive to compensation
and other benefits from the Company in the same amount and on the
same terms as the Executive would be entitled hereunder if the
Executive's employment were terminated following a Change in
Control other than by reason of a Nonqualifying Termination. For
purposes of implementing the foregoing, the date on which any
such merger, consolidation or transfer becomes effective shall be
deemed the Date of Termination.
(c) This Agreement shall inure to the benefit of and
be enforceable by the Executive's personal or legal
representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees. If the Executive shall die
while any amounts would be payable to the Executive hereunder had
the Executive continued to live, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the
terms of this Agreement to such person or persons appointed in
writing by the Executive to receive such amounts or, if no person
is so appointed, to the Executive's estate.
11. Notice. (a) For purposes of this Agreement, all
notices and other communications required or permitted hereunder
shall be in writing and shall be deemed to have been duly given
when delivered or five days after deposit in the United States
mail, certified and return receipt requested, postage prepaid,
addressed (1) if to the Executive, to Lawrence G. Wolski, 221
White Deer Drive, Lemont, Illinois 60439, and if to the Company,
to Joslyn Corporation, 30 South Wacker Drive, Chicago, Illinois
60606, attention President with a copy to the Secretary, or (2)
to such other address as either party may have furnished to the
other in writing in accordance herewith, except that notices of
change of address shall be effective only upon receipt.
(b) A written notice of the Executive's Date of
Termination by the Company or the Executive, as the case may be,
to the other, shall (i) indicate the specific termination
provision in this Agreement relied upon, (ii) to the extent
applicable, set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the
Executive's employment under the provision so indicated and (iii)
specify the termination date (which date shall be not less than
three days after the giving of such notice by the Executive of
termination during the Window Period and which date shall not be
less than 15 days after the giving of such notice under other
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circumstances). The failure by the Executive or the Company to
set forth in such notice any fact or circumstance which
contributes to a showing of Good Reason or Cause shall not waive
any right of the Executive or the Company hereunder or preclude
the Executive or the Company from asserting such fact or
circumstance in enforcing the Executive's or the Company's rights
hereunder.
12. Full Settlement; Resolution of Disputes. (a) The
Company's obligation to make any payments provided for in this
Agreement and otherwise to perform its obligations hereunder
shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Company may
have against the Executive or others. In no event shall the
Executive be obligated to seek other employment or take any other
action by way of mitigation of the amounts payable to the
Executive under any of the provisions of this Agreement and such
amounts shall not be reduced whether or not the Executive obtains
other employment.
(b) If there shall be any dispute between the Company
and the Executive in the event of any termination of the
Executive's employment, then, unless and until there is a final,
nonappealable judgment by a court of competent jurisdiction
declaring that such termination was for Cause, that the
determination by the Executive of the existence of Good Reason
was not made in good faith, or that the Company is not otherwise
obligated to pay any amount or provide any benefit to the
Executive and his dependents or other beneficiaries, as the case
may be, under paragraphs (a) and (b) of Section 3, the Company
shall pay all amounts, and provide all benefits, to the Executive
and his dependents or other beneficiaries, as the case may be,
that the Company would be required to pay or provide pursuant to
paragraphs (a) and (b) of Section 3 as though such termination
were by the Company without Cause or by the Executive with Good
Reason; provided, however, that the Company shall not be required
to pay any disputed amounts pursuant to this paragraph except
upon receipt of an undertaking by or on behalf of the Executive
to repay all such amounts to which the Executive is ultimately
adjudged by such court not to be entitled.
13. Employment with Subsidiaries. Employment with the
Company for purposes of this Agreement shall include employment
with any corporation or other entity in which the Company has a
direct or indirect ownership interest of 50% or more of the total
combined voting power of the then outstanding securities of such
corporation or other entity entitled to vote generally in the
election of directors.
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14. Governing Law; Validity. The interpretation,
construction and performance of this Agreement shall be governed
by and construed and enforced in accordance with the internal
laws of the State of Illinois without regard to the principle of
conflicts of laws. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which
other provisions shall remain in full force and effect.
15. Counterparts. This Agreement may be executed in
two or more counterparts, each of which shall be deemed to be an
original and all of which together shall constitute one and the
same instrument.
16. Miscellaneous. No provision of this Agreement may
be modified or waived unless such modification or waiver is
agreed to in writing and signed by the Executive and by a duly
authorized officer of the Company. No waiver by either party
hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to
be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at
any prior or subsequent time. Failure by the Executive or the
Company to insist upon strict compliance with any provision of
this Agreement or to assert any right the Executive or the
Company may have hereunder, including, without limitation, the
right of the Executive to terminate employment for Good Reason,
shall not be deemed to be a waiver of such provision or right or
any other provision or right of this Agreement. The rights of,
and benefits payable to, the Executive, his estate or his
beneficiaries pursuant to this Agreement are in addition to any
rights of, or benefits payable to, the Executive, his estate or
his beneficiaries under any other employee benefit plan or
compensation program of the Company.
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IN WITNESS WHEREOF, the Company has caused this
Agreement to be executed by a duly authorized officer of the
Company and the Executive has executed this Agreement as of the
day and year first above written.
JOSLYN CORPORATION
By:___________________________
Raymond E. Micheletti
President and Chief Executive
Officer
EXECUTIVE
______________________________
Lawrence G. Wolski
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Exhibit 10.2
SEVERANCE AGREEMENT
THIS AGREEMENT is entered into as of the 16th day of
September, 1994 by and between Joslyn Corporation, an Illinois
corporation, and Wayne M. Koprowski (the "Executive").
W I T N E S S E T H
WHEREAS, the Executive currently serves as a key
employee of the Company (as defined in Section 1) and his
services and knowledge are valuable to the Company in connection
with the management of one or more of the Company's principal
operating facilities, divisions, departments or subsidiaries; and
WHEREAS, the Board (as defined in Section 1) has
determined that it is in the best interests of the Company and
its shareholders to secure the Executive's continued services and
to ensure the Executive's continued dedication and objectivity in
the event of any threat or occurrence of, or negotiation or other
action that could lead to, or create the possibility of, a Change
in Control (as defined in Section 1) of the Company, without
concern as to whether the Executive might be hindered or
distracted by personal uncertainties and risks created by any
such possible Change in Control, and to encourage the Executive's
full attention and dedication to the Company, the Board has
authorized the Company to enter into this Agreement.
NOW, THEREFORE, for and in consideration of the
premises and the mutual covenants and agreements herein
contained, the Company and the Executive hereby agree as follows:
1. Definitions. As used in this Agreement, the
following terms shall have the respective meanings set forth
below:
(a) "Board" means the Board of Directors of the
Company.
(b) "Bonus Plan" means the Executive Management
Incentive Plan of Joslyn Corporation, or any plan of an
affiliated company of the Company intended to provide similar
benefits, or any of their successor plans.
(c) "Cause" means (1) a material breach by the
Executive of those duties and responsibilities of the Executive
which do not differ in any material respect from the duties and
responsibilities of the Executive during the 90-day period
immediately prior to a Change in Control (other than as a result
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of incapacity due to physical or mental illness) which is
demonstrably willful and deliberate on the Executive's part,
which is committed in bad faith or without reasonable belief that
such breach is in the best interests of the Company and which is
not remedied in a reasonable period of time after receipt of
written notice from the Company specifying such breach or (2) the
commission by the Executive of a felony involving moral
turpitude.
(d) "Change in Control" means:
(1) the acquisition by any individual, entity or group
(a "Person"), including any "person" within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act (hereinafter
defined), of beneficial ownership within the meaning of Rule 13d-
3 promulgated under the Exchange Act, of 25% or more of either
(i) the then outstanding common shares of the Company (the
"Outstanding Company Common Shares") or (ii) the combined voting
power of the then outstanding securities of the Company entitled
to vote generally in the election of directors (the "Outstanding
Company Voting Securities"); provided, however, that the
following acquisitions shall not constitute a Change in Control:
(A) any acquisition directly from the Company (excluding any
acquisition resulting from the exercise of a conversion or
exchange privilege in respect of outstanding convertible or
exchangeable securities), (B) any acquisition by the Company, (C)
any acquisition by an employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation
controlled by the Company, or (D) any acquisition by any
corporation pursuant to a reorganization, merger or consolidation
involving the Company, if, immediately after such reorganization,
merger or consolidation, each of the conditions described in
clauses (i), (ii) and (iii) of subsection (3) of this Section 1
(d) shall be satisfied; and provided further that, for purposes
of clause (B), if any Person (other than the Company or any
employee benefit plan (or related trust) sponsored or maintained
by the Company or any corporation controlled by the Company)
shall become the beneficial owner of 25% or more of the
Outstanding Company Common Shares or 25% or more of the
Outstanding Company Voting Securities by reason of an acquisition
by the Company and such Person shall, after such acquisition by
the Company, become the beneficial owner of any additional shares
of the Outstanding Company Common Shares or any additional
Outstanding Voting Securities and such beneficial ownership is
publicly announced, such additional beneficial ownership shall
constitute a Change in Control;
(2) individuals who, as of the date hereof,
constitute the Board (the "Incumbent Board") cease for any reason
to constitute at least a majority of such Board; provided,
however, that any individual who becomes a director of the
Company subsequent to the date hereof whose election, or
nomination for election by the Company's shareholders, was
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approved by the vote of at least a majority of the directors then
comprising the Incumbent Board shall be deemed to have been a
member of the Incumbent Board; and provided further, that no
individual who was initially elected as a director of the Company
as a result of an actual or threatened election contest, as such
terms are used in Rule 14a-11 of Regulation 14A promulgated under
the Exchange Act, or any other actual or threatened solicitation
of proxies or consents by or on behalf of any Person other than
the Board shall be deemed to have been a member of the Incumbent
Board;
(3) approval by the shareholders of the Company of a
reorganization, merger or consolidation unless, in any such case,
immediately after such reorganization, merger or consolidation,
(i) more than 60% of the then outstanding shares of common stock
of the corporation resulting from such reorganization, merger or
consolidation and more than 60% of the combined voting power of
the then outstanding securities of such corporation entitled to
vote generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of the
individuals or entities who were the beneficial owners,
respectively, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities immediately prior to such
reorganization, merger or consolidation and in substantially the
same proportions relative to each other as their ownership,
immediately prior to such reorganization, merger or
consolidation, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities, as the case may be, (ii)
no Person (other than the Company, any employee benefit plan (or
related trust) sponsored or maintained by the Company or the
corporation resulting from such reorganization, merger or
consolidation (or any corporation controlled by the Company) and
any Person which beneficially owned, immediately prior to such
reorganization, merger or consolidation, directly or indirectly,
25% or more of the Outstanding Company Common Shares or the
Outstanding Company Voting Securities, as the case may be)
beneficially owns, directly or indirectly, 25% or more of the
then outstanding shares of common stock of such corporation or
25% or more of the combined voting power of the then outstanding
securities of such corporation entitled to vote generally in the
election of directors and (iii) at least a majority of the
members of the board of directors of the corporation resulting
from such reorganization, merger or consolidation were members of
the Incumbent Board at the time of the execution of the initial
agreement or action of the Board providing for such
reorganization, merger or consolidation; or
(4) approval by the shareholders of the Company of (i)
a plan of complete liquidation or dissolution of the Company or
(ii) the sale or other disposition of all or substantially all of
the assets of the Company other than to a corporation with
respect to which, immediately after such sale or other
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disposition, (A) more than 60% of the then outstanding shares of
common stock thereof and more than 60% of the combined voting
power of the then outstanding securities thereof entitled to vote
generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities immediately prior to such
sale or other disposition and in substantially the same
proportions relative to each other as their ownership,
immediately prior to such sale or other disposition, of the
Outstanding Company Common Shares and the Outstanding Company
Voting Securities, as the case may be, (B) no Person (other than
the Company, any employee benefit plan (or related trust)
sponsored or maintained by the Company or such corporation (or
any corporation controlled by the Company) and any Person which
beneficially owned, immediately prior to such sale or other
disposition, directly or indirectly, 25% or more of the
Outstanding Company Common Shares or the Outstanding Company
Voting Securities, as the case may be) beneficially owns,
directly or indirectly, 25% or more of the then outstanding
shares of common stock thereof or 25% or more of the combined
voting power of the then outstanding securities thereof entitled
to vote generally in the election of directors and (C) at least a
majority of the members of the board of directors thereof were
members of the Incumbent Board at the time of the execution of
the initial agreement or action of the Board providing for such
sale or other disposition.
(e) "Code" means the Internal Revenue Code of 1986, as
amended.
(f) "Company" means Joslyn Corporation, an Illinois
corporation.
(g) "Date of Termination" means (1) the effective date
on which the Executive's employment by the Company terminates as
specified in a prior written notice by the Company or the
Executive, as the case may be, to the other, delivered pursuant
to Section 11 or (2) if the Executive's employment by the Company
terminates by reason of death, the date of death of the
Executive.
(h) "Exchange Act" means the Securities Exchange Act
of 1934, as amended.
(i) "Good Reason" means, without the Executive's
express written consent, the occurrence of any of the following
events after a Change in Control:
(1) any of (i) the assignment to the Executive of any
duties inconsistent in any material respect with the Executive's
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position(s), duties, responsibilities or status with the Company
immediately prior to such Change in Control, (ii) a change in the
Executive's reporting responsibilities, titles or offices with
the Company as in effect immediately prior to such Change in
Control or (iii) any removal or involuntary termination of the
Executive from the Company otherwise than as expressly permitted
by this Agreement or any failure to re-elect the Executive to any
position with the Company held by the Executive immediately prior
to such Change in Control;
(2) a reduction by the Company in the Executive's rate
of annual base salary as in effect immediately prior to such
Change in Control or as the same may be increased from time to
time thereafter or the failure by the Company to increase such
rate of base salary each year after such Change in Control by an
amount which at least equals the annual percentage increase, if
any, in the Consumer Price Index for All Items For All Urban
Consumers respecting the metropolitan area closest to the
Executive's place of residence as reported by the United States
Department of Labor, Bureau of Labor Statistics;
(3) any requirement of the Company that the Executive
have a regular work site located more than 50 miles from the
regular work site of the Executive at the time of the Change in
Control;
(4) the failure of the Company to (i) continue in
effect any employee benefit plan or compensation plan in which
the Executive is participating immediately prior to such Change
in Control, unless the Executive is permitted to participate in
other plans providing the Executive with substantially comparable
benefits, or the taking of any action by the Company which would
adversely affect the Executive's participation in or materially
reduce the Executive's benefits under any such plan, (ii) provide
the Executive and the Executive's dependents welfare benefits
(including, without limitation, medical, prescription, dental,
disability, salary continuance, employee life, group life,
accidental death and travel accident insurance plans and
programs) in accordance with the most favorable plans, practices,
programs and policies of the Company and its affiliated companies
in effect for the Executive immediately prior to such Change in
Control or, if more favorable to the Executive, as in effect
generally at any time thereafter with respect to other peer
executives of the Company and its affiliated companies, (iii)
provide fringe benefits in accordance with the most favorable
plans, practices, programs and policies of the Company and its
affiliated companies in effect for the Executive immediately
prior to such Change in Control or, if more favorable to the
Executive, as in effect generally at any time thereafter with
respect to other peer executives of the Company and its
affiliated companies, (iv) provide the Executive with paid
vacation in accordance with the most favorable plans, policies,
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programs and practices of the Company and its affiliated
companies as in effect for the Executive immediately prior to
such Change in Control or, if more favorable to the Executive, as
in effect generally at any time thereafter with respect to other
peer executives of the Company and its affiliated companies, or
(v) reimburse the Executive promptly for all reasonable
employment expenses incurred by the Executive in accordance with
the most favorable policies, practices and procedures of the
Company and its affiliated companies in effect for the Executive
immediately prior to such Change in Control, or if more favorable
to the Executive, as in effect generally at any time thereafter
with respect to other peer executives of the Company and its
affiliated companies; or
(5) the failure of the Company to obtain the
assumption agreement from any successor as contemplated in
Section 10(b).
For purposes of this Agreement, any good faith
determination of Good Reason made by the Executive shall be
conclusive; provided, however, that an isolated, insubstantial
and inadvertent action taken in good faith and which is remedied
by the Company promptly after receipt of notice thereof given by
the Executive shall not constitute Good Reason.
(j) "Nonqualifying Termination" means a termination of
the Executive's employment (1) by the Company for Cause, (2) by
the Executive for any reason other than a Good Reason, (3) as a
result of the Executive's death or (4) by the Company due to the
Executive's absence from his duties with the Company on a full-
time basis for at least 180 consecutive days as a result of the
Executive's incapacity due to physical or mental illness;
provided, however, that a termination of the Executive's
employment by the Executive for any reason whatsoever during the
"Window Period" (hereinafter defined) shall not constitute a
Nonqualifying Termination.
(k) "Parity Plan" means the Parity Compensation Plan
of Joslyn Corporation, or any plan of an affiliated company of
the Company intended to provide similar benefits, or any of their
successor plans.
(l) "Profit Sharing Plan" means the Employees' Savings
and Profit Sharing Plan of Joslyn Corporation, or any plan of an
affiliated company of the Company intended to provide similar
benefits, or any of their successor plans.
(m) "Termination Period" means the period of time
beginning with a Change in Control and ending on the earliest to
occur of (1) the Executive's 70th birthday, (2) the Executive's
death, and (3) two years following such Change in Control.
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(n) "Termination Year Bonus" shall have the meaning
set forth in Section 3(a)(1).
(o) "Termination Year Parity Amount" shall have the
meaning set forth in Section 3(a)(1).
(p) "Termination Year Profit Sharing Amount" shall
have the meaning set forth in Section 3(a)(1).
(q) "Window Period" means the 30-day period commencing
one year after the date of a Change in Control.
2. Obligations of the Executive. The Executive
agrees that in the event any person or group attempts a Change in
Control, he shall not voluntarily leave the employ of the Company
without Good Reason (a) until such attempted Change in Control
terminates or (b) if a Change in Control shall occur, until 90
days following such Change in Control. For purposes of the
foregoing subsection (a), Good Reason shall be determined as if a
Change in Control had occurred when such attempted Change in
Control became known to the Board.
3. Payments Upon Termination of Employment.
(a) If during the Termination Period the employment of
the Executive shall terminate, other than by reason of a
Nonqualifying Termination, then the Company shall pay to the
Executive (or the Executive's beneficiary or estate), as
compensation for services rendered to the Company:
(1) within 30 days following the Date of Termination,
a lump-sum cash amount equal to the sum of:
(i) the Executive's full annual base salary from the
Company and its affiliated companies through the Date of
Termination, to the extent not theretofore paid,
(ii) the Executive's Award Payment at 100% of Plan
Accomplishment level under the Bonus Plan (one-half maximum
potential award), for the full fiscal year in which the Date of
Termination occurs, calculated in accordance with the terms of
the Bonus Plan as in effect immediately prior to the Change in
Control or as in effect on the Date of Termination, whichever
results in a greater amount, as if a Change in Control had not
occurred, the Executive were employed by the Company at the end
of the such fiscal year and all other conditions necessary for
the payment by the Company of such bonus were satisfied (the
"Termination Year Bonus"), multiplied by a fraction, the
numerator of which is the number of days in the fiscal year in
which the Date of Termination occurs through the Date of
Termination and the denominator of which is 365 or 366, as
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applicable, reduced by the amount otherwise payable pursuant to
the terms of the Bonus Plan for such plan year;
(iii) the Executive's Parity Compensation payment as
determined under the Parity Plan, for the full fiscal year in
which the Date of Termination occurs, calculated in accordance
with the terms of the Parity Plan as in effect immediately prior
to the Change in Control or as in effect on the Date of
Termination, whichever results in a greater amount, as if a
Change in Control had not occurred, the Executive were employed
by the Company at the end of such fiscal year, the Executive had
received the Termination Year Bonus and all other conditions
necessary for the payment by the Company of such Parity
Compensation payment were satisfied (the "Termination Year Parity
Amount"), multiplied by a fraction, the numerator of which is the
number of days in the fiscal year in which the Date of
Termination occurs through the Date of Termination and the
denominator of which is 365 or 366, as applicable, reduced by the
amount otherwise payable pursuant to the terms of the Parity Plan
for such plan year;
(iv) the maximum Profit Sharing Contribution for the
Executive under the Profit Sharing Plan, for the full fiscal year
in which the Date of Termination occurs, calculated in accordance
with the terms of the Profit Sharing Plan as in effect
immediately prior to the Change in Control or as in effect on the
Date of Termination, whichever results in a greater amount, as if
a Change in Control had not occurred, the Executive were employed
by the Company at the end of such fiscal year, the Executive had
received the Termination Year Bonus and all other conditions
necessary for the payment by the Company of such Profit Sharing
Contribution were satisfied (the "Termination Year Profit Sharing
Amount"), multiplied by a fraction, the numerator of which is the
number of days in the fiscal year in which the Date of
Termination occurs through the Date of Termination and the
denominator of which is 365 or 366, as applicable, reduced by the
amount otherwise allocated to the Executive's account under the
Profit Sharing Plan pursuant to the terms of the Profit Sharing
Plan for such plan year as determined at the Date of Termination;
and
(v) any compensation previously deferred by the
Executive (together with any interest and earnings thereon) and
any accrued vacation pay, in each case to the extent not
theretofore paid; plus
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(2) within 30 days following the Date of Termination,
unless such payment date is extended pursuant to Section 4, in
which case such payment date may not be extended beyond 90 days
following the Date of Termination, a lump-sum cash amount in an
amount equal to the sum of (i) two (2) times the Executive's
highest annual base salary from the Company and its affiliated
companies in effect during the 12-month period prior to the Date
of Termination, (ii) two (2) times the Executive's full
Termination Year Bonus, (iii) two (2) times the Executive's full
Termination Year Parity Amount, and (iv) two (2) times the
Executive's full Termination Year Profit Sharing Amount;
provided, however, that any amount paid pursuant to this Section
3(a)(2) may be reduced in accordance with the provisions of
Section 4; provided further, that in the event there are fewer
than 24 whole months remaining from the Date of Termination to
the date of the Executive's 70th birthday, the amount calculated
in accordance with this Section 3(a)(2) shall be reduced by
multiplying such amount by a fraction the numerator of which is
the number of months, including a partial month (with a partial
month being expressed as a fraction the numerator of which is the
number of days remaining in such month and the denominator of
which is the number of days in such month), so remaining and the
denominator of which is 24; and provided further, that, except as
otherwise provided in this Agreement, any amount paid pursuant to
this Section 3(a)(2) shall be paid in lieu of any other amount of
severance relating to salary or bonus continuation to be received
by the Executive upon termination of employment of the Executive
under any severance plan, employment agreement, policy or
arrangement of the Company applicable to the Executive, other
than amounts to be received by the Executive upon termination of
employment of the Executive under the Bonus Plan, the Parity Plan
or the Profit Sharing Plan.
(b) (1) In addition to the payments to be made
pursuant to paragraph (a) of this Section 3, if on the Date of
Termination the Executive shall not be fully vested in any
employer contributions or earnings thereon made on his behalf
under the Profit Sharing Plan, the Company shall pay to the
Executive within 30 days following the Date of Termination a lump
sum cash amount equal to the value of the unvested portion of
such employer contributions and earnings; provided, however, that
if any payment pursuant to this Section 3(b)(1) may or would
result in such payment being deemed a transaction which is
subject to Section 16(b) of the Exchange Act, the Company shall
make such payment so as to meet the conditions for an exemption
from such Section 16(b) as set forth in the rules (and
interpretive and no-action letters relating thereto) under
Section 16. The value of any such unvested employer
contributions and earnings shall be determined in accordance with
the terms of the Profit Sharing Plan.
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(2) For a period of two (2) years commencing on the
Date of Termination, the Company shall continue to keep in full
force and effect all medical, dental, accident and life insurance
plans with respect to the Executive and his dependents with the
same level of coverage, upon the same terms and otherwise to the
same extent as such plans shall have been in effect immediately
prior to the Date of Termination. Notwithstanding the foregoing
sentence, if any of the medical, dental, accident or life
insurance plans then in effect generally with respect to other
peer executives of the Company and its affiliated companies would
be more favorable to the Executive, such plan coverage shall be
substituted for the analogous plan coverage provided to the
Executive immediately prior to the Date of Termination, and the
Company and the Executive shall share the costs of such plan
coverage in the same proportion as such costs were shared
immediately prior to the Date of Termination. The obligation of
the Company to continue coverage of the Executive and the
Executive's dependents under such plans shall cease at such time
as the Executive and the Executive's dependents obtain comparable
coverage under another plan, including a plan maintained by a new
employer. Execution of this Agreement by the Executive shall not
be considered a waiver of any rights or entitlements the
Executive and the Executive's dependents may have under
applicable law to continuation of coverage under the group
medical plan maintained by the Company or its affiliated
companies.
(3) If the Executive shall be at least 50 years of age
and the sum of the Executive's age and years of service with the
Company is at least 75 at (i) the termination of medical coverage
provided by Section 3(b)(2) hereof, (ii) the termination of the
severance continuation under the Company's Group Medical coverage
or (iii) the end of any COBRA continuation of Group Medical
coverage, the Company shall provide the Executive with the
ability to elect Group Medical coverage for the Executive and the
Executive's dependents; provided, that the maximum continuation
period of such coverage shall be until age 65 for the Executive
and any covered spouse, and in accordance with the provisions of
the Company's Group Medical Plan for covered children. The
extended continuation of Group Medical coverage described in the
previous sentence shall be subject to the provisions of the
Company's Group Medical Plan and a required contribution fee
equal to the rate for Early Retiree's under the Company's Retiree
Medical Plan for Plan "A" coverage, or for Plan "B" coverage, the
Early Retiree Rate less the difference between the Plan "A" and
Plan "B" contribution rates for active employees.
(4) The Company shall reimburse the Executive for 90%
of the Executive's expenditures for obtaining outplacement
services, provided that the Company shall have no obligation to
reimburse the Executive in an amount which exceeds 10% of the
Executive's highest annual base salary from the Company and its
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affiliated companies in effect during the 12-month period prior
to the Date of Termination.
(c) If during the Termination Period the employment of
the Executive shall terminate by reason of a Nonqualifying
Termination, then the Company shall pay to the Executive within
30 days following the Date of Termination, a lump-sum cash amount
equal to the sum of (1) the Executive's full annual base salary
from the Company through the Date of Termination, to the extent
not theretofore paid and (2) any compensation previously deferred
by the Executive (together with any interest and earnings
thereon) and any accrued vacation pay, in each case to the extent
not theretofore paid.
4. Excess Parachute Payments. (a) Anything in this
Agreement to the contrary notwithstanding, in the event it shall
be determined that any payment or distribution by the Company or
its affiliated companies to or for the benefit of the Executive,
whether paid or payable or distributed or distributable pursuant
to the terms of this Agreement or otherwise (in the aggregate,
"Total Payments"), would constitute an "excess parachute
payment," then Total Payments shall be reduced to be One Dollar
($1) less than the maximum amount which may be paid or
distributed to or for the benefit of the Executive without
causing the Executive to be subject to the tax imposed by Section
4999 of the Code (or any successor provision) in respect of Total
Payments or which the Company or its affiliated companies may pay
without loss of deduction under Section 280G(a) of the Code (or
any successor provision) (Total Payments, as so reduced, the
"Adjusted Total Payments"). For purposes of this Agreement, the
terms "excess parachute payment" and "parachute payments" shall
have the meanings assigned to them in Section 280G of the Code
(or any successor provision), and such "parachute payments" shall
be valued as provided therein. Present value for purposes of
this Agreement shall be calculated in accordance with Section
1274(b)(2) of the Code (or any successor provision).
(b) Within 60 days following the Date of Termination
or notice by the Company to the Executive of its reasonable
belief that there is a payment or distribution due to or for the
benefit of the Executive which would result in an excess
parachute payment, the Executive and the Company, at the
Company's expense, shall obtain the opinion (which need not be
unqualified) of nationally recognized tax counsel selected by the
Company's independent auditors and acceptable to the Executive in
his sole discretion (which may be regular outside counsel to the
Company), which opinion sets forth (A) the amount of the
Executive's Base Period Income, (B) the amount and present value
of Total Payments and (C) the amount and present value of any
excess parachute payments determined without regard to the
limitations of this Section 4. As used in this Section 4(b), the
term "Base Period Income" means the Executive's "annualized
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includible compensation for the base period" as defined in
Section 280G(d)(1) of the Code (or any successor provision). For
purposes of such opinion, the value of any noncash benefits or
any deferred payment or benefit included in Total Payments shall
be determined by the Company's independent auditors at the
Company's expense in accordance with the principles of Sections
280G(d)(3) and (4) of the Code (or any successor provisions),
which determination shall be evidenced in a certificate of such
auditors addressed to the Company and the Executive. Such
opinion shall be addressed to the Company and the Executive and
shall be binding upon the Company and the Executive. If such
opinion concludes that any Total Payments constitute an excess
parachute payment, the amount payable hereunder or any other
payment or distribution determined by such counsel in such
opinion to be includible in Total Payments shall be reduced or
eliminated as specified by the Executive in writing delivered to
the Company within 30 days of his receipt of such opinion or, if
the Executive fails to so notify the Company, then as the Company
shall reasonably determine, so that under the bases of
calculations set forth in such opinion the Total Payments shall
be the Adjusted Total Payments. If such legal counsel so
requests in connection with the opinion required by this Section
4, the Executive and the Company shall obtain, at the Company's
expense, and such legal counsel may rely on in providing the
opinion, the advice of a firm of recognized executive
compensation consultants as to the reasonableness of any item of
compensation to be paid to or for the benefit of the Executive.
If the provisions of Sections 280G and 4999 of the Code (or any
successor provisions) are repealed without succession, then this
Section 4 shall be of no further force or effect.
5. Withholding Taxes. The Company may withhold from
all payments due to the Executive (or his beneficiary or estate)
hereunder all taxes which, by applicable federal, state, local or
other law, the Company is required to withhold therefrom.
6. Reimbursement of Expenses. If any contest or
dispute shall arise under this Agreement involving termination of
the Executive's employment with the Company or involving the
failure or refusal of the Company to perform fully in accordance
with the terms hereof, the Company shall reimburse the Executive,
on a current basis, for all legal fees and expenses, if any,
incurred by the Executive in connection with such contest or
dispute, together with interest at a rate equal to the rate of
interest published in The Wall Street Journal under the caption
"Money Rates" as the prime rate, but in no event higher than the
maximum legal rate permissible under applicable law, such
interest to accrue from the date the Company receives the
Executive's statement for such fees and expenses through the date
of payment thereof; provided, however, that in the event the
resolution of any such contest or dispute includes a finding
denying, in total, the Executive's claims in such contest or
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dispute, the Executive shall be required to reimburse the
Company, over a period of 12 months from the date of such
resolution, for all sums advanced to the Executive pursuant to
this Section 6.
7. Operative Event. Notwithstanding any provision
herein to the contrary, no amounts shall be payable hereunder
unless and until there is a Change in Control at a time when the
Executive is employed by the Company.
8. Termination of Agreement. (a) This Agreement
shall be effective on the date hereof and shall continue until
terminated by the Company as provided in paragraph (b) of this
Section 8; provided, however, that this Agreement shall terminate
in any event upon the first to occur of (i) the Executive's 70th
birthday, (ii) the Executive's death and (iii) termination of the
Executive's employment with the Company prior to a Change in
Control.
(b) The Company shall have the right prior to a Change
in Control, in its sole discretion, pursuant to action by the
Board, to approve the termination of this Agreement, which
termination shall not become effective until the date fixed by
the Board for such termination, which date shall be at least 120
days after notice thereof is given by the Company to the
Executive in accordance with Section 11; provided, however, that
no such action shall be taken by the Board during any period of
time when the Board has knowledge that any person has taken steps
reasonably calculated to effect a Change in Control until, in the
opinion of the Board, such person has abandoned or terminated its
efforts to effect a Change in Control; and provided further, that
in no event shall this Agreement be terminated in the event of a
Change in Control.
9. Scope of Agreement. Nothing in this Agreement
shall be deemed to entitle the Executive to continued employment
with the Company or its subsidiaries, and if the Executive's
employment with the Company shall terminate prior to a Change in
Control, then the Executive shall have no further rights under
this Agreement; provided, however, that any termination of the
Executive's employment following a Change in Control shall be
subject to all of the provisions of this Agreement.
10. Successors; Binding Agreement. (a) This
Agreement shall not be terminated by any merger or consolidation
of the Company whereby the Company is or is not the surviving or
resulting corporation or as a result of any transfer of all or
substantially all of the assets of the Company. In the event of
any such merger, consolidation or transfer of assets, the
provisions of this Agreement shall be binding upon the surviving
or resulting corporation or the person or entity to which such
assets are transferred.
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(b) The Company agrees that concurrently with any
merger, consolidation or transfer of assets referred to in
paragraph (a) of this Section 10, it will cause any successor or
transferee unconditionally to assume, by written instrument
delivered to the Executive (or his beneficiary or estate), all of
the obligations of the Company hereunder. Failure of the Company
to obtain such assumption prior to the effectiveness of any such
merger, consolidation or transfer of assets shall be a breach of
this Agreement and shall entitle the Executive to compensation
and other benefits from the Company in the same amount and on the
same terms as the Executive would be entitled hereunder if the
Executive's employment were terminated following a Change in
Control other than by reason of a Nonqualifying Termination. For
purposes of implementing the foregoing, the date on which any
such merger, consolidation or transfer becomes effective shall be
deemed the Date of Termination.
(c) This Agreement shall inure to the benefit of and
be enforceable by the Executive's personal or legal
representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees. If the Executive shall die
while any amounts would be payable to the Executive hereunder had
the Executive continued to live, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the
terms of this Agreement to such person or persons appointed in
writing by the Executive to receive such amounts or, if no person
is so appointed, to the Executive's estate.
11. Notice. (a) For purposes of this Agreement, all
notices and other communications required or permitted hereunder
shall be in writing and shall be deemed to have been duly given
when delivered or five days after deposit in the United States
mail, certified and return receipt requested, postage prepaid,
addressed (1) if to the Executive, to Wayne M. Koprowski, 1131
Peregrine Court, Palatine, Illinois 60067, and if to the Company,
to Joslyn Corporation, 30 South Wacker Drive, Chicago, Illinois
60606, attention President with a copy to the Secretary, or (2)
to such other address as either party may have furnished to the
other in writing in accordance herewith, except that notices of
change of address shall be effective only upon receipt.
(b) A written notice of the Executive's Date of
Termination by the Company or the Executive, as the case may be,
to the other, shall (i) indicate the specific termination
provision in this Agreement relied upon, (ii) to the extent
applicable, set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the
Executive's employment under the provision so indicated and (iii)
specify the termination date (which date shall be not less than
three days after the giving of such notice by the Executive of
termination during the Window Period and which date shall not be
less than 15 days after the giving of such notice under other
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circumstances). The failure by the Executive or the Company to
set forth in such notice any fact or circumstance which
contributes to a showing of Good Reason or Cause shall not waive
any right of the Executive or the Company hereunder or preclude
the Executive or the Company from asserting such fact or
circumstance in enforcing the Executive's or the Company's rights
hereunder.
12. Full Settlement; Resolution of Disputes. (a) The
Company's obligation to make any payments provided for in this
Agreement and otherwise to perform its obligations hereunder
shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Company may
have against the Executive or others. In no event shall the
Executive be obligated to seek other employment or take any other
action by way of mitigation of the amounts payable to the
Executive under any of the provisions of this Agreement and such
amounts shall not be reduced whether or not the Executive obtains
other employment.
(b) If there shall be any dispute between the Company
and the Executive in the event of any termination of the
Executive's employment, then, unless and until there is a final,
nonappealable judgment by a court of competent jurisdiction
declaring that such termination was for Cause, that the
determination by the Executive of the existence of Good Reason
was not made in good faith, or that the Company is not otherwise
obligated to pay any amount or provide any benefit to the
Executive and his dependents or other beneficiaries, as the case
may be, under paragraphs (a) and (b) of Section 3, the Company
shall pay all amounts, and provide all benefits, to the Executive
and his dependents or other beneficiaries, as the case may be,
that the Company would be required to pay or provide pursuant to
paragraphs (a) and (b) of Section 3 as though such termination
were by the Company without Cause or by the Executive with Good
Reason; provided, however, that the Company shall not be required
to pay any disputed amounts pursuant to this paragraph except
upon receipt of an undertaking by or on behalf of the Executive
to repay all such amounts to which the Executive is ultimately
adjudged by such court not to be entitled.
13. Employment with Subsidiaries. Employment with the
Company for purposes of this Agreement shall include employment
with any corporation or other entity in which the Company has a
direct or indirect ownership interest of 50% or more of the total
combined voting power of the then outstanding securities of such
corporation or other entity entitled to vote generally in the
election of directors.
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14. Governing Law; Validity. The interpretation,
construction and performance of this Agreement shall be governed
by and construed and enforced in accordance with the internal
laws of the State of Illinois without regard to the principle of
conflicts of laws. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which
other provisions shall remain in full force and effect.
15. Counterparts. This Agreement may be executed in
two or more counterparts, each of which shall be deemed to be an
original and all of which together shall constitute one and the
same instrument.
16. Miscellaneous. No provision of this Agreement may
be modified or waived unless such modification or waiver is
agreed to in writing and signed by the Executive and by a duly
authorized officer of the Company. No waiver by either party
hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to
be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at
any prior or subsequent time. Failure by the Executive or the
Company to insist upon strict compliance with any provision of
this Agreement or to assert any right the Executive or the
Company may have hereunder, including, without limitation, the
right of the Executive to terminate employment for Good Reason,
shall not be deemed to be a waiver of such provision or right or
any other provision or right of this Agreement. The rights of,
and benefits payable to, the Executive, his estate or his
beneficiaries pursuant to this Agreement are in addition to any
rights of, or benefits payable to, the Executive, his estate or
his beneficiaries under any other employee benefit plan or
compensation program of the Company.
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IN WITNESS WHEREOF, the Company has caused this
Agreement to be executed by a duly authorized officer of the
Company and the Executive has executed this Agreement as of the
day and year first above written.
JOSLYN CORPORATION
By:___________________________
Raymond E. Micheletti
President and Chief Executive
Officer
EXECUTIVE
______________________________
Wayne M. Koprowski
85 17
Exhibit 10.3
SEVERANCE AGREEMENT
THIS AGREEMENT is entered into as of the 16th day of
September, 1994 by and between Joslyn Corporation, an Illinois
corporation, and George W. Diehl (the "Executive").
W I T N E S S E T H
WHEREAS, the Executive currently serves as a key
employee of the Company and the Subsidiary (as such terms are
defined in Section 1) and his services and knowledge are valuable
to the Company in connection with the management of one or more
of the Company's principal operating facilities, divisions,
departments or subsidiaries; and
WHEREAS, the Board (as defined in Section 1) has
determined that it is in the best interests of the Company and
its shareholders to secure the Executive's continued services and
to ensure the Executive's continued dedication and objectivity in
the event of any threat or occurrence of, or negotiation or other
action that could lead to, or create the possibility of, a Change
in Control (as defined in Section 1) of the Company, without
concern as to whether the Executive might be hindered or
distracted by personal uncertainties and risks created by any
such possible Change in Control, and to encourage the Executive's
full attention and dedication to the Company, the Board has
authorized the Company to enter into this Agreement.
NOW, THEREFORE, for and in consideration of the
premises and the mutual covenants and agreements herein
contained, the Company and the Executive hereby agree as follows:
1. Definitions. As used in this Agreement, the
following terms shall have the respective meanings set forth
below:
(a) "Board" means the Board of Directors of the
Company.
(b) "Bonus Plan" means the Executive Management
Incentive Plan of Joslyn Corporation, or any plan of an
affiliated company of the Company intended to provide similar
benefits, or any of their successor plans.
(c) "Cause" means (1) a material breach by the
Executive of those duties and responsibilities of the Executive
which do not differ in any material respect from the duties and
responsibilities of the Executive during the 90-day period
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immediately prior to a Change in Control (other than as a result
of incapacity due to physical or mental illness) which is
demonstrably willful and deliberate on the Executive's part,
which is committed in bad faith or without reasonable belief that
such breach is in the best interests of the Company and which is
not remedied in a reasonable period of time after receipt of
written notice from the Company specifying such breach or (2) the
commission by the Executive of a felony involving moral
turpitude.
(d) "Change in Control" means:
(1) the acquisition by any individual, entity or group
(a "Person"), including any "person" within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act (hereinafter
defined), of beneficial ownership within the meaning of Rule 13d-
3 promulgated under the Exchange Act, of 25% or more of either
(i) the then outstanding common shares of the Company (the
"Outstanding Company Common Shares") or (ii) the combined voting
power of the then outstanding securities of the Company entitled
to vote generally in the election of directors (the "Outstanding
Company Voting Securities"); provided, however, that the
following acquisitions shall not constitute a Change in Control:
(A) any acquisition directly from the Company (excluding any
acquisition resulting from the exercise of a conversion or
exchange privilege in respect of outstanding convertible or
exchangeable securities), (B) any acquisition by the Company, (C)
any acquisition by an employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation
controlled by the Company, or (D) any acquisition by any
corporation pursuant to a reorganization, merger or consolidation
involving the Company, if, immediately after such reorganization,
merger or consolidation, each of the conditions described in
clauses (i), (ii) and (iii) of subsection (3) of this Section 1
(d) shall be satisfied; and provided further that, for purposes
of clause (B), if any Person (other than the Company or any
employee benefit plan (or related trust) sponsored or maintained
by the Company or any corporation controlled by the Company)
shall become the beneficial owner of 25% or more of the
Outstanding Company Common Shares or 25% or more of the
Outstanding Company Voting Securities by reason of an acquisition
by the Company and such Person shall, after such acquisition by
the Company, become the beneficial owner of any additional shares
of the Outstanding Company Common Shares or any additional
Outstanding Voting Securities and such beneficial ownership is
publicly announced, such additional beneficial ownership shall
constitute a Change in Control;
(2) individuals who, as of the date hereof,
constitute the Board (the "Incumbent Board") cease for any reason
to constitute at least a majority of such Board; provided,
however, that any individual who becomes a director of the
Company subsequent to the date hereof whose election, or
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nomination for election by the Company's shareholders, was
approved by the vote of at least a majority of the directors then
comprising the Incumbent Board shall be deemed to have been a
member of the Incumbent Board; and provided further, that no
individual who was initially elected as a director of the Company
as a result of an actual or threatened election contest, as such
terms are used in Rule 14a-11 of Regulation 14A promulgated under
the Exchange Act, or any other actual or threatened solicitation
of proxies or consents by or on behalf of any Person other than
the Board shall be deemed to have been a member of the Incumbent
Board;
(3) approval by the shareholders of the Company of a
reorganization, merger or consolidation unless, in any such case,
immediately after such reorganization, merger or consolidation,
(i) more than 60% of the then outstanding shares of common stock
of the corporation resulting from such reorganization, merger or
consolidation and more than 60% of the combined voting power of
the then outstanding securities of such corporation entitled to
vote generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of the
individuals or entities who were the beneficial owners,
respectively, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities immediately prior to such
reorganization, merger or consolidation and in substantially the
same proportions relative to each other as their ownership,
immediately prior to such reorganization, merger or
consolidation, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities, as the case may be, (ii)
no Person (other than the Company, any employee benefit plan (or
related trust) sponsored or maintained by the Company or the
corporation resulting from such reorganization, merger or
consolidation (or any corporation controlled by the Company) and
any Person which beneficially owned, immediately prior to such
reorganization, merger or consolidation, directly or indirectly,
25% or more of the Outstanding Company Common Shares or the
Outstanding Company Voting Securities, as the case may be)
beneficially owns, directly or indirectly, 25% or more of the
then outstanding shares of common stock of such corporation or
25% or more of the combined voting power of the then outstanding
securities of such corporation entitled to vote generally in the
election of directors and (iii) at least a majority of the
members of the board of directors of the corporation resulting
from such reorganization, merger or consolidation were members of
the Incumbent Board at the time of the execution of the initial
agreement or action of the Board providing for such
reorganization, merger or consolidation; or
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(4) approval by the shareholders of the Company of (i)
a plan of complete liquidation or dissolution of the Company or
(ii) the sale or other disposition of all or substantially all of
the assets of the Company other than to a corporation with
respect to which, immediately after such sale or other
disposition, (A) more than 60% of the then outstanding shares of
common stock thereof and more than 60% of the combined voting
power of the then outstanding securities thereof entitled to vote
generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities immediately prior to such
sale or other disposition and in substantially the same
proportions relative to each other as their ownership,
immediately prior to such sale or other disposition, of the
Outstanding Company Common Shares and the Outstanding Company
Voting Securities, as the case may be, (B) no Person (other than
the Company, any employee benefit plan (or related trust)
sponsored or maintained by the Company or such corporation (or
any corporation controlled by the Company) and any Person which
beneficially owned, immediately prior to such sale or other
disposition, directly or indirectly, 25% or more of the
Outstanding Company Common Shares or the Outstanding Company
Voting Securities, as the case may be) beneficially owns,
directly or indirectly, 25% or more of the then outstanding
shares of common stock thereof or 25% or more of the combined
voting power of the then outstanding securities thereof entitled
to vote generally in the election of directors and (C) at least a
majority of the members of the board of directors thereof were
members of the Incumbent Board at the time of the execution of
the initial agreement or action of the Board providing for such
sale or other disposition.
(e) "Code" means the Internal Revenue Code of 1986, as
amended.
(f) "Company" means Joslyn Corporation, an Illinois
corporation.
(g) "Date of Termination" means (1) the effective date
on which the Executive's employment by the Company terminates as
specified in a prior written notice by the Company or the
Executive, as the case may be, to the other, delivered pursuant
to Section 11 or (2) if the Executive's employment by the Company
terminates by reason of death, the date of death of the
Executive.
(h) "Exchange Act" means the Securities Exchange Act
of 1934, as amended.
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(i) "Good Reason" means, without the Executive's
express written consent, the occurrence of any of the following
events after a Change in Control:
(1) any of (i) the assignment to the Executive of any
duties inconsistent in any material respect with the Executive's
position(s), duties, responsibilities or status with the Company
immediately prior to such Change in Control, (ii) a change in the
Executive's reporting responsibilities, titles or offices with
the Company as in effect immediately prior to such Change in
Control or (iii) any removal or involuntary termination of the
Executive from the Company otherwise than as expressly permitted
by this Agreement or any failure to re-elect the Executive to any
position with the Company held by the Executive immediately prior
to such Change in Control;
(2) a reduction by the Company in the Executive's rate
of annual base salary as in effect immediately prior to such
Change in Control or as the same may be increased from time to
time thereafter or the failure by the Company to increase such
rate of base salary each year after such Change in Control by an
amount which at least equals the annual percentage increase, if
any, in the Consumer Price Index for All Items For All Urban
Consumers respecting the metropolitan area closest to the
Executive's place of residence as reported by the United States
Department of Labor, Bureau of Labor Statistics;
(3) any requirement of the Company that the Executive
have a regular work site located more than 50 miles from the
regular work site of the Executive at the time of the Change in
Control;
(4) the failure of the Company to (i) continue in
effect any employee benefit plan or compensation plan in which
the Executive is participating immediately prior to such Change
in Control, unless the Executive is permitted to participate in
other plans providing the Executive with substantially comparable
benefits, or the taking of any action by the Company which would
adversely affect the Executive's participation in or materially
reduce the Executive's benefits under any such plan, (ii) provide
the Executive and the Executive's dependents welfare benefits
(including, without limitation, medical, prescription, dental,
disability, salary continuance, employee life, group life,
accidental death and travel accident insurance plans and
programs) in accordance with the most favorable plans, practices,
programs and policies of the Company or the Subsidiary, whichever
is the employer of the Executive, in effect for the Executive
immediately prior to such Change in Control or, if more favorable
to the Executive, as in effect generally at any time thereafter
with respect to other peer executives of the Company or the
Subsidiary, whichever is the employer of the Executive, (iii)
provide fringe benefits in accordance with the most favorable
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plans, practices, programs and policies of the Company or the
Subsidiary, whichever is the employer of the Executive, in effect
for the Executive immediately prior to such Change in Control or,
if more favorable to the Executive, as in effect generally at any
time thereafter with respect to other peer executives of the
Company or the Subsidiary, whichever is the employer of the
Executive, (iv) provide the Executive with paid vacation in
accordance with the most favorable plans, policies, programs and
practices of the Company or the Subsidiary, whichever is the
employer of the Executive, as in effect for the Executive
immediately prior to such Change in Control or, if more favorable
to the Executive, as in effect generally at any time thereafter
with respect to other peer executives of the Company or the
Subsidiary, whichever is the employer of the Executive, or (v)
reimburse the Executive promptly for all reasonable employment
expenses incurred by the Executive in accordance with the most
favorable policies, practices and procedures of the Company or
the Subsidiary, whichever is the employer of the Executive, in
effect for the Executive immediately prior to such Change in
Control, or if more favorable to the Executive, as in effect
generally at any time thereafter with respect to other peer
executives of the Company or the Subsidiary, whichever is the
employer of the Executive; or
(5) the failure of the Company to obtain the
assumption agreement from any successor as contemplated in
Section 10(b).
For purposes of this Agreement, references to the
Company in the definition of Good Reason shall be deemed to be
references to the Company or the Subsidiary.
For purposes of this Agreement, any good faith
determination of Good Reason made by the Executive shall be
conclusive; provided, however, that an isolated, insubstantial
and inadvertent action taken in good faith and which is remedied
by the Company promptly after receipt of notice thereof given by
the Executive shall not constitute Good Reason.
(j) "Nonqualifying Termination" means a termination of
the Executive's employment with the Company or the Subsidiary (1)
by the Company or the Subsidiary for Cause, (2) by the Executive
for any reason other than a Good Reason, (3) as a result of the
Executive's death or (4) by the Company or the Subsidiary due to
the Executive's absence from his duties with the Company or the
Subsidiary on a full-time basis for at least 180 consecutive days
as a result of the Executive's incapacity due to physical or
mental illness; provided, however, that a termination of the
Executive's employment with the Company or the Subsidiary by the
Executive for any reason whatsoever during the "Window Period"
(hereinafter defined) shall not constitute a Nonqualifying
Termination.
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(k) "Parity Plan" means the Parity Compensation Plan
of Joslyn Corporation, or any plan of an affiliated company of
the Company intended to provide similar benefits, or any of their
successor plans.
(l) "Profit Sharing Plan" means the Employees' Savings
and Profit Sharing Plan of Joslyn Corporation, or any plan of an
affiliated company of the Company intended to provide similar
benefits, or any of their successor plans.
(m) "Subsidiary" means Joslyn Hi-Voltage Corporation,
a subsidiary of the Company.
(n) "Termination Period" means the period of time
beginning with a Change in Control and ending on the earliest to
occur of (1) the Executive's 70th birthday, (2) the Executive's
death, and (3) two years following such Change in Control.
(o) "Termination Year Bonus" shall have the meaning
set forth in Section 3(a)(1).
(p) "Termination Year Parity Amount" shall have the
meaning set forth in Section 3(a)(1).
(q) "Termination Year Profit Sharing Amount" shall
have the meaning set forth in Section 3(a)(1).
(r) "Window Period" means the 30-day period commencing
one year after the date of a Change in Control.
2. Obligations of the Executive. The Executive
agrees that in the event any person or group attempts a Change in
Control, he shall not voluntarily leave the employ of the Company
without Good Reason (a) until such attempted Change in Control
terminates or (b) if a Change in Control shall occur, until 90
days following such Change in Control. For purposes of the
foregoing subsection (a), Good Reason shall be determined as if a
Change in Control had occurred when such attempted Change in
Control became known to the Board.
3. Payments Upon Termination of Employment.
(a) If during the Termination Period the employment of
the Executive with the Company or the Subsidiary shall terminate,
other than by reason of a Nonqualifying Termination, then the
Company shall pay to the Executive (or the Executive's
beneficiary or estate), as compensation for services rendered to
the Company or the Subsidiary, as the case may be:
(1) within 30 days following the Date of Termination,
a lump-sum cash amount equal to the sum of:
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(i) the Executive's full annual base salary from the
Company and its affiliated companies through the Date of
Termination, to the extent not theretofore paid,
(ii) the Executive's Award Payment at 100% of Plan
Accomplishment level under the Bonus Plan (one-half maximum
potential award), for the full fiscal year in which the Date of
Termination occurs, calculated in accordance with the terms of
the Bonus Plan as in effect immediately prior to the Change in
Control or as in effect on the Date of Termination, whichever
results in a greater amount, as if a Change in Control had not
occurred, the Executive were employed by the Company at the end
of the such fiscal year and all other conditions necessary for
the payment by the Company of such bonus were satisfied (the
"Termination Year Bonus"), multiplied by a fraction, the
numerator of which is the number of days in the fiscal year in
which the Date of Termination occurs through the Date of
Termination and the denominator of which is 365 or 366, as
applicable, reduced by the amount otherwise payable pursuant to
the terms of the Bonus Plan for such plan year;
(iii) the Executive's Parity Compensation payment as
determined under the Parity Plan, for the full fiscal year in
which the Date of Termination occurs, calculated in accordance
with the terms of the Parity Plan as in effect immediately prior
to the Change in Control or as in effect on the Date of
Termination, whichever results in a greater amount, as if a
Change in Control had not occurred, the Executive were employed
by the Company at the end of such fiscal year, the Executive had
received the Termination Year Bonus and all other conditions
necessary for the payment by the Company of such Parity
Compensation payment were satisfied (the "Termination Year Parity
Amount"), multiplied by a fraction, the numerator of which is the
number of days in the fiscal year in which the Date of
Termination occurs through the Date of Termination and the
denominator of which is 365 or 366, as applicable, reduced by the
amount otherwise payable pursuant to the terms of the Parity Plan
for such plan year;
(iv) the maximum Profit Sharing Contribution for the
Executive under the Profit Sharing Plan, for the full fiscal year
in which the Date of Termination occurs, calculated in accordance
with the terms of the Profit Sharing Plan as in effect
immediately prior to the Change in Control or as in effect on the
Date of Termination, whichever results in a greater amount, as if
a Change in Control had not occurred, the Executive were employed
by the Company at the end of such fiscal year, the Executive had
received the Termination Year Bonus and all other conditions
necessary for the payment by the Company of such Profit Sharing
Contribution were satisfied (the "Termination Year Profit Sharing
Amount"), multiplied by a fraction, the numerator of which is the
number of days in the fiscal year in which the Date of
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Termination occurs through the Date of Termination and the
denominator of which is 365 or 366, as applicable, reduced by the
amount otherwise allocated to the Executive's account under the
Profit Sharing Plan pursuant to the terms of the Profit Sharing
Plan for such plan year as determined at the Date of Termination;
and
(v) any compensation previously deferred by the
Executive (together with any interest and earnings thereon) and
any accrued vacation pay, in each case to the extent not
theretofore paid; plus
(2) within 30 days following the Date of Termination,
unless such payment date is extended pursuant to Section 4, in
which case such payment date may not be extended beyond 90 days
following the Date of Termination, a lump-sum cash amount in an
amount equal to the sum of (i) two (2) times the Executive's
highest annual base salary from the Company and its affiliated
companies in effect during the 12-month period prior to the Date
of Termination, (ii) two (2) times the Executive's full
Termination Year Bonus, (iii) two (2) times the Executive's full
Termination Year Parity Amount, and (iv) two (2) times the
Executive's full Termination Year Profit Sharing Amount;
provided, however, that any amount paid pursuant to this Section
3(a)(2) may be reduced in accordance with the provisions of
Section 4; provided further, that in the event there are fewer
than 24 whole months remaining from the Date of Termination to
the date of the Executive's 70th birthday, the amount calculated
in accordance with this Section 3(a)(2) shall be reduced by
multiplying such amount by a fraction the numerator of which is
the number of months, including a partial month (with a partial
month being expressed as a fraction the numerator of which is the
number of days remaining in such month and the denominator of
which is the number of days in such month), so remaining and the
denominator of which is 24; and provided further, that, except as
otherwise provided in this Agreement, any amount paid pursuant to
this Section 3(a)(2) shall be paid in lieu of any other amount of
severance relating to salary or bonus continuation to be received
by the Executive upon termination of employment of the Executive
under any severance plan, employment agreement, policy or
arrangement of the Company applicable to the Executive, other
than amounts to be received by the Executive upon termination of
employment of the Executive under the Bonus Plan, the Parity Plan
or the Profit Sharing Plan.
(b) (1) In addition to the payments to be made
pursuant to paragraph (a) of this Section 3, if on the Date of
Termination the Executive shall not be fully vested in any
employer contributions or earnings thereon made on his behalf
under the Profit Sharing Plan, the Company shall pay to the
Executive within 30 days following the Date of Termination a lump
sum cash amount equal to the value of the unvested portion of
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such employer contributions and earnings; provided, however, that
if any payment pursuant to this Section 3(b)(1) may or would
result in such payment being deemed a transaction which is
subject to Section 16(b) of the Exchange Act, the Company shall
make such payment so as to meet the conditions for an exemption
from such Section 16(b) as set forth in the rules (and
interpretive and no-action letters relating thereto) under
Section 16. The value of any such unvested employer
contributions and earnings shall be determined in accordance with
the terms of the Profit Sharing Plan.
(2) For a period of two (2) years commencing on the
Date of Termination, the Company shall continue to keep in full
force and effect all medical, dental, accident and life insurance
plans with respect to the Executive and his dependents with the
same level of coverage, upon the same terms and otherwise to the
same extent as such plans shall have been in effect immediately
prior to the Date of Termination. Notwithstanding the foregoing
sentence, if any of the medical, dental, accident or life
insurance plans then in effect generally with respect to other
peer executives of the Company and its affiliated companies would
be more favorable to the Executive, such plan coverage shall be
substituted for the analogous plan coverage provided to the
Executive immediately prior to the Date of Termination, and the
Company and the Executive shall share the costs of such plan
coverage in the same proportion as such costs were shared
immediately prior to the Date of Termination. The obligation of
the Company to continue coverage of the Executive and the
Executive's dependents under such plans shall cease at such time
as the Executive and the Executive's dependents obtain comparable
coverage under another plan, including a plan maintained by a new
employer. Execution of this Agreement by the Executive shall not
be considered a waiver of any rights or entitlements the
Executive and the Executive's dependents may have under
applicable law to continuation of coverage under the group
medical plan maintained by the Company or its affiliated
companies.
(3) If the Executive shall be at least 50 years of age
and the sum of the Executive's age and years of service with the
Company is at least 75 at (i) the termination of medical coverage
provided by Section 3(b)(2) hereof, (ii) the termination of the
severance continuation under the Company's Group Medical coverage
or (iii) the end of any COBRA continuation of Group Medical
coverage, the Company shall provide the Executive with the
ability to elect Group Medical coverage for the Executive and the
Executive's dependents; provided, that the maximum continuation
period of such coverage shall be until age 65 for the Executive
and any covered spouse, and in accordance with the provisions of
the Company's Group Medical Plan for covered children. The
extended continuation of Group Medical coverage described in the
previous sentence shall be subject to the provisions of the
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Company's Group Medical Plan and a required contribution fee
equal to the rate for Early Retiree's under the Company's Retiree
Medical Plan for Plan "A" coverage, or for Plan "B" coverage, the
Early Retiree Rate less the difference between the Plan "A" and
Plan "B" contribution rates for active employees.
(4) The Company shall reimburse the Executive for 90%
of the Executive's expenditures for obtaining outplacement
services, provided that the Company shall have no obligation to
reimburse the Executive in an amount which exceeds 10% of the
Executive's highest annual base salary from the Company and its
affiliated companies in effect during the 12-month period prior
to the Date of Termination.
(c) If during the Termination Period the employment of
the Executive shall terminate by reason of a Nonqualifying
Termination, then the Company shall pay to the Executive within
30 days following the Date of Termination, a lump-sum cash amount
equal to the sum of (1) the Executive's full annual base salary
from the Company through the Date of Termination, to the extent
not theretofore paid and (2) any compensation previously deferred
by the Executive (together with any interest and earnings
thereon) and any accrued vacation pay, in each case to the extent
not theretofore paid.
4. Excess Parachute Payments. (a) Anything in this
Agreement to the contrary notwithstanding, in the event it shall
be determined that any payment or distribution by the Company or
its affiliated companies to or for the benefit of the Executive,
whether paid or payable or distributed or distributable pursuant
to the terms of this Agreement or otherwise (in the aggregate,
"Total Payments"), would constitute an "excess parachute
payment," then Total Payments shall be reduced to be One Dollar
($1) less than the maximum amount which may be paid or
distributed to or for the benefit of the Executive without
causing the Executive to be subject to the tax imposed by Section
4999 of the Code (or any successor provision) in respect of Total
Payments or which the Company or its affiliated companies may pay
without loss of deduction under Section 280G(a) of the Code (or
any successor provision) (Total Payments, as so reduced, the
"Adjusted Total Payments"). For purposes of this Agreement, the
terms "excess parachute payment" and "parachute payments" shall
have the meanings assigned to them in Section 280G of the Code
(or any successor provision), and such "parachute payments" shall
be valued as provided therein. Present value for purposes of
this Agreement shall be calculated in accordance with Section
1274(b)(2) of the Code (or any successor provision).
(b) Within 60 days following the Date of Termination
or notice by the Company to the Executive of its reasonable
belief that there is a payment or distribution due to or for the
benefit of the Executive which would result in an excess
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parachute payment, the Executive and the Company, at the
Company's expense, shall obtain the opinion (which need not be
unqualified) of nationally recognized tax counsel selected by the
Company's independent auditors and acceptable to the Executive in
his sole discretion (which may be regular outside counsel to the
Company), which opinion sets forth (A) the amount of the
Executive's Base Period Income, (B) the amount and present value
of Total Payments and (C) the amount and present value of any
excess parachute payments determined without regard to the
limitations of this Section 4. As used in this Section 4(b), the
term "Base Period Income" means the Executive's "annualized
includible compensation for the base period" as defined in
Section 280G(d)(1) of the Code (or any successor provision). For
purposes of such opinion, the value of any noncash benefits or
any deferred payment or benefit included in Total Payments shall
be determined by the Company's independent auditors at the
Company's expense in accordance with the principles of Sections
280G(d)(3) and (4) of the Code (or any successor provisions),
which determination shall be evidenced in a certificate of such
auditors addressed to the Company and the Executive. Such
opinion shall be addressed to the Company and the Executive and
shall be binding upon the Company and the Executive. If such
opinion concludes that any Total Payments constitute an excess
parachute payment, the amount payable hereunder or any other
payment or distribution determined by such counsel in such
opinion to be includible in Total Payments shall be reduced or
eliminated as specified by the Executive in writing delivered to
the Company within 30 days of his receipt of such opinion or, if
the Executive fails to so notify the Company, then as the Company
shall reasonably determine, so that under the bases of
calculations set forth in such opinion the Total Payments shall
be the Adjusted Total Payments. If such legal counsel so
requests in connection with the opinion required by this Section
4, the Executive and the Company shall obtain, at the Company's
expense, and such legal counsel may rely on in providing the
opinion, the advice of a firm of recognized executive
compensation consultants as to the reasonableness of any item of
compensation to be paid to or for the benefit of the Executive.
If the provisions of Sections 280G and 4999 of the Code (or any
successor provisions) are repealed without succession, then this
Section 4 shall be of no further force or effect.
5. Withholding Taxes. The Company may withhold from
all payments due to the Executive (or his beneficiary or estate)
hereunder all taxes which, by applicable federal, state, local or
other law, the Company is required to withhold therefrom.
6. Reimbursement of Expenses. If any contest or
dispute shall arise under this Agreement involving termination of
the Executive's employment with the Company or involving the
failure or refusal of the Company to perform fully in accordance
with the terms hereof, the Company shall reimburse the Executive,
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on a current basis, for all legal fees and expenses, if any,
incurred by the Executive in connection with such contest or
dispute, together with interest at a rate equal to the rate of
interest published in The Wall Street Journal under the caption
"Money Rates" as the prime rate, but in no event higher than the
maximum legal rate permissible under applicable law, such
interest to accrue from the date the Company receives the
Executive's statement for such fees and expenses through the date
of payment thereof; provided, however, that in the event the
resolution of any such contest or dispute includes a finding
denying, in total, the Executive's claims in such contest or
dispute, the Executive shall be required to reimburse the
Company, over a period of 12 months from the date of such
resolution, for all sums advanced to the Executive pursuant to
this Section 6.
7. Operative Event. Notwithstanding any provision
herein to the contrary, no amounts shall be payable hereunder
unless and until there is a Change in Control at a time when the
Executive is employed by the Company.
8. Termination of Agreement. (a) This Agreement
shall be effective on the date hereof and shall continue until
terminated by the Company as provided in paragraph (b) of this
Section 8; provided, however, that this Agreement shall terminate
in any event upon the first to occur of (i) the Executive's 70th
birthday, (ii) the Executive's death and (iii) termination of the
Executive's employment with the Company prior to a Change in
Control.
(b) The Company shall have the right prior to a Change
in Control, in its sole discretion, pursuant to action by the
Board, to approve the termination of this Agreement, which
termination shall not become effective until the date fixed by
the Board for such termination, which date shall be at least 120
days after notice thereof is given by the Company to the
Executive in accordance with Section 11; provided, however, that
no such action shall be taken by the Board during any period of
time when the Board has knowledge that any person has taken steps
reasonably calculated to effect a Change in Control until, in the
opinion of the Board, such person has abandoned or terminated its
efforts to effect a Change in Control; and provided further, that
in no event shall this Agreement be terminated in the event of a
Change in Control.
9. Scope of Agreement. Nothing in this Agreement
shall be deemed to entitle the Executive to continued employment
with the Company or its subsidiaries, and if the Executive's
employment with the Company shall terminate prior to a Change in
Control, then the Executive shall have no further rights under
this Agreement; provided, however, that any termination of the
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Executive's employment following a Change in Control shall be
subject to all of the provisions of this Agreement.
10. Successors; Binding Agreement. (a) This
Agreement shall not be terminated by any merger or consolidation
of the Company whereby the Company is or is not the surviving or
resulting corporation or as a result of any transfer of all or
substantially all of the assets of the Company. In the event of
any such merger, consolidation or transfer of assets, the
provisions of this Agreement shall be binding upon the surviving
or resulting corporation or the person or entity to which such
assets are transferred.
(b) The Company agrees that concurrently with any
merger, consolidation or transfer of assets referred to in
paragraph (a) of this Section 10, it will cause any successor or
transferee unconditionally to assume, by written instrument
delivered to the Executive (or his beneficiary or estate), all of
the obligations of the Company hereunder. Failure of the Company
to obtain such assumption prior to the effectiveness of any such
merger, consolidation or transfer of assets shall be a breach of
this Agreement and shall entitle the Executive to compensation
and other benefits from the Company in the same amount and on the
same terms as the Executive would be entitled hereunder if the
Executive's employment were terminated following a Change in
Control other than by reason of a Nonqualifying Termination. For
purposes of implementing the foregoing, the date on which any
such merger, consolidation or transfer becomes effective shall be
deemed the Date of Termination.
(c) This Agreement shall inure to the benefit of and
be enforceable by the Executive's personal or legal
representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees. If the Executive shall die
while any amounts would be payable to the Executive hereunder had
the Executive continued to live, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the
terms of this Agreement to such person or persons appointed in
writing by the Executive to receive such amounts or, if no person
is so appointed, to the Executive's estate.
11. Notice. (a) For purposes of this Agreement, all
notices and other communications required or permitted hereunder
shall be in writing and shall be deemed to have been duly given
when delivered or five days after deposit in the United States
mail, certified and return receipt requested, postage prepaid,
addressed (1) if to the Executive, to George W. Diehl, 3017
Kingsley, Cleveland, Ohio 44122, and if to the Company, to Joslyn
Corporation, 30 South Wacker Drive, Chicago, Illinois 60606,
attention President with a copy to the Secretary, or (2) to such
other address as either party may have furnished to the other in
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writing in accordance herewith, except that notices of change of
address shall be effective only upon receipt.
(b) A written notice of the Executive's Date of
Termination by the Company or the Executive, as the case may be,
to the other, shall (i) indicate the specific termination
provision in this Agreement relied upon, (ii) to the extent
applicable, set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the
Executive's employment under the provision so indicated and (iii)
specify the termination date (which date shall be not less than
three days after the giving of such notice by the Executive of
termination during the Window Period and which date shall not be
less than 15 days after the giving of such notice under other
circumstances). The failure by the Executive or the Company to
set forth in such notice any fact or circumstance which
contributes to a showing of Good Reason or Cause shall not waive
any right of the Executive or the Company hereunder or preclude
the Executive or the Company from asserting such fact or
circumstance in enforcing the Executive's or the Company's rights
hereunder.
12. Full Settlement; Resolution of Disputes. (a) The
Company's obligation to make any payments provided for in this
Agreement and otherwise to perform its obligations hereunder
shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Company may
have against the Executive or others. In no event shall the
Executive be obligated to seek other employment or take any other
action by way of mitigation of the amounts payable to the
Executive under any of the provisions of this Agreement and such
amounts shall not be reduced whether or not the Executive obtains
other employment.
(b) If there shall be any dispute between the Company
and the Executive in the event of any termination of the
Executive's employment, then, unless and until there is a final,
nonappealable judgment by a court of competent jurisdiction
declaring that such termination was for Cause, that the
determination by the Executive of the existence of Good Reason
was not made in good faith, or that the Company is not otherwise
obligated to pay any amount or provide any benefit to the
Executive and his dependents or other beneficiaries, as the case
may be, under paragraphs (a) and (b) of Section 3, the Company
shall pay all amounts, and provide all benefits, to the Executive
and his dependents or other beneficiaries, as the case may be,
that the Company would be required to pay or provide pursuant to
paragraphs (a) and (b) of Section 3 as though such termination
were by the Company without Cause or by the Executive with Good
Reason; provided, however, that the Company shall not be required
to pay any disputed amounts pursuant to this paragraph except
upon receipt of an undertaking by or on behalf of the Executive
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to repay all such amounts to which the Executive is ultimately
adjudged by such court not to be entitled.
13. Employment with Subsidiaries. Employment with the
Company for purposes of this Agreement shall include employment
with any corporation or other entity in which the Company has a
direct or indirect ownership interest of 50% or more of the total
combined voting power of the then outstanding securities of such
corporation or other entity entitled to vote generally in the
election of directors.
14. Governing Law; Validity. The interpretation,
construction and performance of this Agreement shall be governed
by and construed and enforced in accordance with the internal
laws of the State of Illinois without regard to the principle of
conflicts of laws. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which
other provisions shall remain in full force and effect.
15. Counterparts. This Agreement may be executed in
two or more counterparts, each of which shall be deemed to be an
original and all of which together shall constitute one and the
same instrument.
16. Miscellaneous. No provision of this Agreement may
be modified or waived unless such modification or waiver is
agreed to in writing and signed by the Executive and by a duly
authorized officer of the Company. No waiver by either party
hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to
be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at
any prior or subsequent time. Failure by the Executive or the
Company to insist upon strict compliance with any provision of
this Agreement or to assert any right the Executive or the
Company may have hereunder, including, without limitation, the
right of the Executive to terminate employment for Good Reason,
shall not be deemed to be a waiver of such provision or right or
any other provision or right of this Agreement. The rights of,
and benefits payable to, the Executive, his estate or his
beneficiaries pursuant to this Agreement are in addition to any
rights of, or benefits payable to, the Executive, his estate or
his beneficiaries under any other employee benefit plan or
compensation program of the Company.
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IN WITNESS WHEREOF, the Company has caused this
Agreement to be executed by a duly authorized officer of the
Company and the Executive has executed this Agreement as of the
day and year first above written.
JOSLYN CORPORATION
By:___________________________
Raymond E. Micheletti
President and Chief Executive
Officer
EXECUTIVE
______________________________
George W. Diehl
102 17
Exhibit 10.4
SEVERANCE POLICY FOR CORPORATE MANAGERS
THIS SEVERANCE POLICY FOR CORPORATE MANAGERS has been
adopted by the Board (as defined in Section 1) as of the 16th day
of September, 1994.
The Board has determined that it is in the best
interests of the Company (as defined in Section 1) and its
shareholders to secure the continued services of the Executives
(as defined in Section 1) and to ensure their continued
dedication and objectivity in the event of any threat or
occurrence of, or negotiation or other action that could lead to,
or create the possibility of, a Change in Control (as defined in
Section 1) of the Company, without concern as to whether the
Executives might be hindered or distracted by personal
uncertainties and risks created by any such possible Change in
Control, and to encourage the Executives' full attention and
dedication to the Company.
1. Definitions. As used in this Severance Policy,
the following terms shall have the respective meanings set forth
below:
(a) "Board" means the Board of Directors of the
Company.
(b) "Bonus Plan" means the Executive Management
Incentive Plan of Joslyn Corporation, or any plan of an
affiliated company of the Company intended to provide similar
benefits, or any of their successor plans.
(c) "Cause" means (1) a material breach by an
Executive of those duties and responsibilities of the Executive
which do not differ in any material respect from the duties and
responsibilities of the Executive during the 90-day period
immediately prior to a Change in Control (other than as a result
of incapacity due to physical or mental illness) which is
demonstrably willful and deliberate on the Executive's part,
which is committed in bad faith or without reasonable belief that
such breach is in the best interests of the Company and which is
not remedied in a reasonable period of time after receipt of
written notice from the Company specifying such breach or (2) the
commission by the Executive of a felony involving moral
turpitude.
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(d) "Change in Control" means:
(1) the acquisition by any individual, entity or group
(a "Person"), including any "person" within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act (hereinafter
defined), of beneficial ownership within the meaning of Rule 13d-
3 promulgated under the Exchange Act, of 25% or more of either
(i) the then outstanding common shares of the Company (the
"Outstanding Company Common Shares") or (ii) the combined voting
power of the then outstanding securities of the Company entitled
to vote generally in the election of directors (the "Outstanding
Company Voting Securities"); provided, however, that the
following acquisitions shall not constitute a Change in Control:
(A) any acquisition directly from the Company (excluding any
acquisition resulting from the exercise of a conversion or
exchange privilege in respect of outstanding convertible or
exchangeable securities), (B) any acquisition by the Company, (C)
any acquisition by an employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation
controlled by the Company, or (D) any acquisition by any
corporation pursuant to a reorganization, merger or consolidation
involving the Company, if, immediately after such reorganization,
merger or consolidation, each of the conditions described in
clauses (i), (ii) and (iii) of subsection (3) of this Section 1
(d) shall be satisfied; and provided further that, for purposes
of clause (B), if any Person (other than the Company or any
employee benefit plan (or related trust) sponsored or maintained
by the Company or any corporation controlled by the Company)
shall become the beneficial owner of 25% or more of the
Outstanding Company Common Shares or 25% or more of the
Outstanding Company Voting Securities by reason of an acquisition
by the Company and such Person shall, after such acquisition by
the Company, become the beneficial owner of any additional shares
of the Outstanding Company Common Shares or any additional
Outstanding Voting Securities and such beneficial ownership is
publicly announced, such additional beneficial ownership shall
constitute a Change in Control;
(2) individuals who, as of the date hereof, constitute
the Board (the "Incumbent Board") cease for any reason to
constitute at least a majority of such Board; provided, however,
that any individual who becomes a director of the Company
subsequent to the date hereof whose election, or nomination for
election by the Company's shareholders, was approved by the vote
of at least a majority of the directors then comprising the
Incumbent Board shall be deemed to have been a member of the
Incumbent Board; and provided further, that no individual who was
initially elected as a director of the Company as a result of an
actual or threatened election contest, as such terms are used in
Rule 14a-11 of Regulation 14A promulgated under the Exchange Act,
or any other actual or threatened solicitation of proxies or
consents by or on behalf of any Person other than the Board shall
be deemed to have been a member of the Incumbent Board;
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(3) approval by the shareholders of the Company of a
reorganization, merger or consolidation unless, in any such case,
immediately after such reorganization, merger or consolidation,
(i) more than 60% of the then outstanding shares of common stock
of the corporation resulting from such reorganization, merger or
consolidation and more than 60% of the combined voting power of
the then outstanding securities of such corporation entitled to
vote generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of the
individuals or entities who were the beneficial owners,
respectively, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities immediately prior to such
reorganization, merger or consolidation and in substantially the
same proportions relative to each other as their ownership,
immediately prior to such reorganization, merger or
consolidation, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities, as the case may be, (ii)
no Person (other than the Company, any employee benefit plan (or
related trust) sponsored or maintained by the Company or the
corporation resulting from such reorganization, merger or
consolidation (or any corporation controlled by the Company) and
any Person which beneficially owned, immediately prior to such
reorganization, merger or consolidation, directly or indirectly,
25% or more of the Outstanding Company Common Shares or the
Outstanding Company Voting Securities, as the case may be)
beneficially owns, directly or indirectly, 25% or more of the
then outstanding shares of common stock of such corporation or
25% or more of the combined voting power of the then outstanding
securities of such corporation entitled to vote generally in the
election of directors and (iii) at least a majority of the
members of the board of directors of the corporation resulting
from such reorganization, merger or consolidation were members of
the Incumbent Board at the time of the execution of the initial
agreement or action of the Board providing for such
reorganization, merger or consolidation; or
(4) approval by the shareholders of the Company of (i)
a plan of complete liquidation or dissolution of the Company or
(ii) the sale or other disposition of all or substantially all of
the assets of the Company other than to a corporation with
respect to which, immediately after such sale or other
disposition, (A) more than 60% of the then outstanding shares of
common stock thereof and more than 60% of the combined voting
power of the then outstanding securities thereof entitled to vote
generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities immediately prior to such
sale or other disposition and in substantially the same
proportions relative to each other as their ownership,
immediately prior to such sale or other disposition, of the
Outstanding Company Common Shares and the Outstanding Company
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Voting Securities, as the case may be, (B) no Person (other than
the Company, any employee benefit plan (or related trust)
sponsored or maintained by the Company or such corporation (or
any corporation controlled by the Company) and any Person which
beneficially owned, immediately prior to such sale or other
disposition, directly or indirectly, 25% or more of the
Outstanding Company Common Shares or the Outstanding Company
Voting Securities, as the case may be) beneficially owns,
directly or indirectly, 25% or more of the then outstanding
shares of common stock thereof or 25% or more of the combined
voting power of the then outstanding securities thereof entitled
to vote generally in the election of directors and (C) at least a
majority of the members of the board of directors thereof were
members of the Incumbent Board at the time of the execution of
the initial agreement or action of the Board providing for such
sale or other disposition.
(e) "Code" means the Internal Revenue Code of 1986, as
amended.
(f) "Company" means Joslyn Corporation, an Illinois
corporation.
(g) "Date of Termination" means (1) the effective date
on which an Executive's employment by the Company terminates as
specified in a prior written notice by the Company or the
Executive, as the case may be, to the other or (2) if an
Executive's employment by the Company terminates by reason of
death, the date of death of the Executive.
(h) "Exchange Act" means the Securities Exchange Act
of 1934, as amended.
(i) "Executives" means the persons whose names are
listed on Schedule 1 hereto.
(j) "General Managers" means the persons whose names
are set forth under the heading "General Managers" on Schedule 1
hereto.
(k) "Good Reason" means, without an Executive's
express written consent, the occurrence of any of the following
events after a Change in Control:
(1) a reduction by the Company in an Executive's rate
of annual base salary as in effect immediately prior to such
Change in Control or as the same may be increased from time to
time thereafter;
(2) any requirement of the Company that an Executive
have a regular work site located more than 50 miles from the
regular work site of such Executive at the time of the Change in
Control;
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(3) the failure of the Company to (i) continue in
effect any employee benefit plan or compensation plan in which an
Executive is participating immediately prior to such Change in
Control, unless the Executive is permitted to participate in
other plans providing the Executive with substantially comparable
benefits, or the taking of any action by the Company which would
adversely affect the Executive's participation in or materially
reduce the Executive's benefits under any such plan, (ii) provide
the Executive and the Executive's dependents welfare benefits
(including, without limitation, medical, prescription, dental,
disability, salary continuance, employee life, group life,
accidental death and travel accident insurance plans and
programs) in accordance with the most favorable plans, practices,
programs and policies of the Company or the Subsidiary, whichever
is the employer of the Executive, in effect for the Executive
immediately prior to such Change in Control or, if more favorable
to the Executive, as in effect generally at any time thereafter
with respect to other peer executives of the Company or the
Subsidiary, whichever is the employer of the Executive, (iii)
provide fringe benefits in accordance with the most favorable
plans, practices, programs and policies of the Company or the
Subsidiary, whichever is the employer of the Executive, in effect
for the Executive immediately prior to such Change in Control or,
if more favorable to the Executive, as in effect generally at any
time thereafter with respect to other peer executives of the
Company or the Subsidiary, whichever is the employer of the
Executive, (iv) provide the Executive with paid vacation in
accordance with the most favorable plans, policies, programs and
practices of the Company or the Subsidiary, whichever is the
employer of the Executive, as in effect for the Executive
immediately prior to such Change in Control or, if more favorable
to the Executive, as in effect generally at any time thereafter
with respect to other peer executives of the Company or the
Subsidiary, whichever is the employer of the Executive or (v)
reimburse the Executive promptly for all reasonable employment
expenses incurred by the Executive in accordance with the most
favorable policies, practices and procedures of the Company or
the Subsidiary, whichever is the employer of the Executive, in
effect for the Executive immediately prior to such Change in
Control, or if more favorable to the Executive, as in effect
generally at any time thereafter with respect to other peer
executives of the Company or the Subsidiary, whichever is the
employer of the Executive;
(4) any removal or involuntary termination of the
Executive from the Company otherwise than as expressly permitted
by this Severance Policy; or
(5) the failure of the Company to obtain the
assumption agreement from any successor as contemplated in
Section 10(b).
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For purposes of this Severance Policy, references to
the Company in the definition of Good Reason shall be deemed to
be references to the Company or the Subsidiary (as such term is
defined in Section 1).
For purposes of this Severance Policy, any good faith
determination of Good Reason made by an Executive shall be
conclusive; provided, however, that an isolated, insubstantial
and inadvertent action taken in good faith and which is remedied
by the Company promptly after receipt of notice thereof given by
the Executive shall not constitute Good Reason.
(l) "Nonqualifying Termination" means a termination of
an Executive's employment with the Company or the Subsidiary (1)
by the Company or the Subsidiary for Cause, (2) by the Executive
for any reason other than a Good Reason, (3) as a result of the
Executive's death, (4) by the Company or the Subsidiary due to
the Executive's absence from the Executive's duties with the
Company or the Subsidiary on a full-time basis for at least 180
consecutive days as a result of the Executive's incapacity due to
physical or mental illness or (5) in connection with a transfer
of the Executive from the Company or the Subsidiary to the
Company, a successor to the Company, or a subsidiary of either,
solely for the purpose of payroll administration.
(m) "Parity Plan" means the Parity Compensation Plan
of Joslyn Corporation, or any plan of an affiliated company of
the Company intended to provide similar benefits, or any of their
successor plans.
(n) "Profit Sharing Plan" means the Employees' Savings
and Profit Sharing Plan of Joslyn Corporation, or any plan of an
affiliated company of the Company intended to provide similar
benefits, or any of their successor plans.
(o) "Service Factor" means, for any Executive, that
number equal to the lesser of (i) 52 and (ii) the sum of 26 and
two times the number of years of service (such number to be
rounded to two decimal places) such Executive has with the
Company.
(p) "Subsidiary" means, with respect to an Executive
employed by a subsidiary of the Company, such subsidiary.
(q) "Termination Period" means the period of time
beginning with a Change in Control and ending on the earliest to
occur of (1) an Executive's 70th birthday, (2) an Executive's
death, and (3) two years following such Change in Control.
(r) "Termination Year Bonus" shall have the meaning
set forth in Section 3(a)(1).
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(s) "Termination Year Parity Amount" shall have the
meaning set forth in Section 3(a)(1).
(t) "Termination Year Profit Sharing Amount" shall
have the meaning set forth in Section 3(a)(1).
2. Obligations of Executives. The Company's
obligations to each Executive pursuant to this Severance Policy
are based upon the condition that in the event any person or
group attempts a Change in Control, the Executive shall not
voluntarily leave the employ of the Company without Good Reason
(a) until such attempted Change in Control terminates or (b) if a
Change in Control shall occur, until 90 days following such
Change in Control. For purposes of the foregoing subsection (a),
Good Reason shall be determined as if a Change in Control had
occurred when such attempted Change in Control became known to
the Board.
3. Payments Upon Termination of Employment. Subject
to the provisions of Section 4,
(a) If during the Termination Period the employment of
an Executive shall terminate, other than by reason of a
Nonqualifying Termination, then the Company shall pay to the
Executive (or the Executive's beneficiary or estate), as
compensation for services rendered to the Company or the
Subsidiary, as the case may be:
(1) within 30 days following the Date of Termination,
a lump-sum cash amount equal to the sum of:
(i) the Executive's full annual base salary from the
Company and its affiliated companies through the Date of
Termination, to the extent not theretofore paid,
(ii) the Executive's Award Payment at 100% of Plan
Accomplishment level under the Bonus Plan (one-half maximum
potential award), for the full fiscal year in which the Date of
Termination occurs, calculated in accordance with the terms of
the Bonus Plan as in effect immediately prior to the Change in
Control or as in effect on the Date of Termination, whichever
results in a greater amount, as if a Change in Control had not
occurred, the Executive were employed by the Company at the end
of the such fiscal year and all other conditions necessary for
the payment by the Company of such bonus were satisfied (the
"Termination Year Bonus"), multiplied by a fraction, the
numerator of which is the number of days in the fiscal year in
which the Date of Termination occurs through the Date of
Termination and the denominator of which is 365 or 366, as
applicable, reduced by the amount otherwise payable pursuant to
the terms of the Bonus Plan for such plan year;
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(iii) the Executive's Parity Compensation payment as
determined under the Parity Plan, for the full fiscal year in
which the Date of Termination occurs, calculated in accordance
with the terms of the Parity Plan as in effect immediately prior
to the Change in Control or as in effect on the Date of
Termination, whichever results in a greater amount, as if a
Change in Control had not occurred, the Executive were employed
by the Company at the end of such fiscal year, the Executive had
received the Termination Year Bonus and all other conditions
necessary for the payment by the Company of such Parity
Compensation payment were satisfied (the "Termination Year Parity
Amount"), multiplied by a fraction, the numerator of which is the
number of days in the fiscal year in which the Date of
Termination occurs through the Date of Termination and the
denominator of which is 365 or 366, as applicable, reduced by the
amount otherwise payable pursuant to the terms of the Parity Plan
for such plan year;
(iv) the maximum Profit Sharing Contribution for the
Executive under the Profit Sharing Plan, for the full fiscal year
in which the Date of Termination occurs, calculated in accordance
with the terms of the Profit Sharing Plan as in effect
immediately prior to the Change in Control or as in effect on the
Date of Termination, whichever results in a greater amount, as if
a Change in Control had not occurred, the Executive were employed
by the Company at the end of such fiscal year, the Executive had
received the Termination Year Bonus and all other conditions
necessary for the payment by the Company of such Profit Sharing
Contribution were satisfied (the "Termination Year Profit Sharing
Amount"), multiplied by a fraction, the numerator of which is the
number of days in the fiscal year in which the Date of
Termination occurs through the Date of Termination and the
denominator of which is 365 or 366, as applicable, reduced by the
amount otherwise allocated to the Executive's account under the
Profit Sharing Plan pursuant to the terms of the Profit Sharing
Plan for such plan year as determined at the Date of Termination;
and
(v) any compensation previously deferred by the
Executive (together with any interest and earnings thereon) and
any accrued vacation pay, in each case to the extent not
theretofore paid; plus
(2) within 30 days following the Date of Termination,
unless such payment date is extended pursuant to Section 4, in
which case such payment date may not be extended beyond 90 days
following the Date of Termination, a lump-sum cash amount in an
amount equal to the product determined by multiplying a fraction,
the numerator of which is the Executive's Service Factor and the
denominator of which is 52, by the sum of (i) the Executive's
highest annual base salary from the Company and its affiliated
companies in effect during the 12-month period prior to the Date
of Termination, (ii) the Executive's full Termination Year Bonus,
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(iii) the Executive's full Termination Year Parity Amount, and
(iv) the Executive's full Termination Year Profit Sharing Amount;
provided, however, that any amount paid pursuant to this Section
3(a)(2) may be reduced in accordance with the provisions of
Section 4; provided further, that in the event there are fewer
than the Executive's Service Factor weeks remaining from the Date
of Termination to the date of the Executive's 70th birthday, the
amount calculated in accordance with this Section 3(a)(2) shall
be reduced by multiplying such amount by a fraction the numerator
of which is the number of weeks so remaining and the denominator
of which is the Executive's Service Factor; and provided further,
that, except as otherwise provided in this Severance Policy, any
amount paid pursuant to this Section 3(a)(2) shall be paid in
lieu of any other amount of severance relating to salary or bonus
continuation to be received by the Executive upon termination of
employment of the Executive under any severance plan, employment
agreement, policy or arrangement of the Company applicable to the
Executive, other than amounts to be received by the Executive
upon termination of employment of the Executive under the Bonus
Plan, the Parity Plan or the Profit Sharing Plan.
(b) (1) In addition to the payments to be made
pursuant to paragraph (a) of this Section 3, if on the Date of
Termination the Executive shall not be fully vested in any
employer contributions or earnings thereon made on the
Executive's behalf under the Profit Sharing Plan, the Company
shall pay to the Executive within 30 days following the Date of
Termination a lump sum cash amount equal to the value of the
unvested portion of such employer contributions and earnings;
provided, however, that if any payment pursuant to this Section
3(b)(1) may or would result in such payment being deemed a
transaction which is subject to Section 16(b) of the Exchange
Act, the Company shall make such payment so as to meet the
conditions for an exemption from such Section 16(b) as set forth
in the rules (and interpretive and no-action letters relating
thereto) under Section 16. The value of any such unvested
employer contributions and earnings shall be determined in
accordance with the terms of the Profit Sharing Plan.
(2) For that number of weeks equal to the Executive's
Service Factor, commencing on the Date of Termination, the
Company shall continue to keep in full force and effect all
medical, dental, accident and life insurance plans with respect
to the Executive and the Executive's dependents with the same
level of coverage, upon the same terms and otherwise to the same
extent as such plans shall have been in effect immediately prior
to the Date of Termination. Notwithstanding the foregoing
sentence, if any of the medical, dental, accident or life
insurance plans then in effect generally with respect to other
peer executives of the Company and its affiliated companies would
be more favorable to the Executive, such plan coverage shall be
substituted for the analogous plan coverage provided to the
Executive immediately prior to the Date of Termination, and the
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Company and the Executive shall share the costs of such plan
coverage in the same proportion as such costs were shared
immediately prior to the Date of Termination. The obligation of
the Company to continue coverage of the Executive and the
Executive's dependents under such plans shall cease at such time
as the Executive and the Executive's dependents obtain comparable
coverage under another plan, including a plan maintained by a new
employer.
(3) If the Executive shall be at least 50 years of age
and the sum of the Executive's age and years of service with the
Company is at least 75 at (i) the termination of medical coverage
provided by Section 3(b)(2) hereof, (ii) the termination of the
severance continuation under the Company's Group Medical coverage
or (iii) the end of any COBRA continuation of Group Medical
coverage, the Company shall provide the Executive with the
ability to elect Group Medical coverage for the Executive and the
Executive's dependents; provided, that the maximum continuation
period of such coverage shall be until age 65 for the Executive
and any covered spouse, and in accordance with the provisions of
the Company's Group Medical Plan for covered children. The
extended continuation of Group Medical coverage described in the
previous sentence shall be subject to the provisions of the
Company's Group Medical Plan and a required contribution fee
equal to the rate for Early Retiree's under the Company's Retiree
Medical Plan for Plan "A" coverage, or for Plan "B" coverage, the
Early Retiree Rate less the difference between the Plan "A" and
Plan "B" contribution rates for active employees.
(4) The Company shall reimburse the Executive for 90%
of the Executive's expenditures for obtaining outplacement
services, provided that the Company shall have no obligation to
reimburse the Executive in an amount which exceeds 10% of the
Executive's highest annual base salary from the Company and its
affiliated companies in effect during the 12-month period prior
to the Date of Termination.
(c) If during the Termination Period the employment of
an Executive shall terminate by reason of a Nonqualifying
Termination, then the Company shall pay to the Executive within
30 days following the Date of Termination, a lump-sum cash amount
equal to the sum of (1) the Executive's full annual base salary
from the Company through the Date of Termination, to the extent
not theretofore paid and (2) any compensation previously deferred
by the Executive (together with any interest and earnings
thereon) and any accrued vacation pay, in each case to the extent
not theretofore paid.
4. Excess Parachute Payments. (a) Anything in this
Severance Policy to the contrary notwithstanding, in the event it
shall be determined that any payment or distribution by the
Company or its affiliated companies to or for the benefit of an
Executive, whether paid or payable or distributed or
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distributable pursuant to the terms of this Severance Policy or
otherwise (in the aggregate, "Total Payments"), would constitute
an "excess parachute payment," then Total Payments shall be
reduced to be One Dollar ($1) less than the maximum amount which
may be paid or distributed to or for the benefit of the Executive
without causing the Executive to be subject to the tax imposed by
Section 4999 of the Code (or any successor provision) in respect
of Total Payments or which the Company or its affiliated
companies may pay without loss of deduction under Section 280G(a)
of the Code (or any successor provision) (Total Payments, as so
reduced, the "Adjusted Total Payments"). For purposes of this
Severance Policy, the terms "excess parachute payment" and
"parachute payments" shall have the meanings assigned to them in
Section 280G of the Code (or any successor provision), and such
"parachute payments" shall be valued as provided therein.
Present value for purposes of this Severance Policy shall be
calculated in accordance with Section 1274(b)(2) of the Code (or
any successor provision).
(b) Within 60 days following the Date of Termination
or notice by the Company to an Executive of its reasonable belief
that there is a payment or distribution due to or for the benefit
of the Executive which would result in an excess parachute
payment, the Executive and the Company, at the Company's expense,
shall obtain the opinion (which need not be unqualified) of
nationally recognized tax counsel selected by the Company's
independent auditors and acceptable to the Executive in the
Executive's sole discretion (which may be regular outside counsel
to the Company), which opinion sets forth (A) the amount of the
Executive's Base Period Income, (B) the amount and present value
of Total Payments and (C) the amount and present value of any
excess parachute payments determined without regard to the
limitations of this Section 4. As used in this Section 4(b), the
term "Base Period Income" means the Executive's "annualized
includible compensation for the base period" as defined in
Section 280G(d)(1) of the Code (or any successor provision). For
purposes of such opinion, the value of any noncash benefits or
any deferred payment or benefit included in Total Payments shall
be determined by the Company's independent auditors at the
Company's expense in accordance with the principles of Sections
280G(d)(3) and (4) of the Code (or any successor provisions),
which determination shall be evidenced in a certificate of such
auditors addressed to the Company and the Executive. Such
opinion shall be addressed to the Company and the Executive and
shall be binding upon the Company and the Executive. If such
opinion concludes that any Total Payments constitute an excess
parachute payment, the amount payable hereunder or any other
payment or distribution determined by such counsel in such
opinion to be includible in Total Payments shall be reduced or
eliminated as specified by the Executive in writing delivered to
the Company within 30 days of the Executive's receipt of such
opinion or, if the Executive fails to so notify the Company, then
as the Company shall reasonably determine, so that under the
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bases of calculations set forth in such opinion the Total
Payments shall be the Adjusted Total Payments. If such legal
counsel so requests in connection with the opinion required by
this Section 4, the Executive and the Company shall obtain, at
the Company's expense, and such legal counsel may rely on in
providing the opinion, the advice of a firm of recognized
executive compensation consultants as to the reasonableness of
any item of compensation to be paid to or for the benefit of the
Executive. If the provisions of Sections 280G and 4999 of the
Code (or any successor provisions) are repealed without
succession, then this Section 4 shall be of no further force or
effect.
5. Withholding Taxes. The Company may withhold from
all payments due to an Executive (or an Executive's beneficiary
or estate) hereunder all taxes which, by applicable federal,
state, local or other law, the Company is required to withhold
therefrom.
6. Reimbursement of Expenses. If any contest or
dispute shall arise under this Severance Policy involving
termination of an Executive's employment with the Company or
involving the failure or refusal of the Company to perform fully
in accordance with the terms hereof, the Company shall reimburse
the Executive, on a current basis, for all legal fees and
expenses, if any, incurred by the Executive in connection with
such contest or dispute, together with interest at a rate equal
to the rate of interest published in The Wall Street Journal
under the caption "Money Rates" as the prime rate, but in no
event higher than the maximum legal rate permissible under
applicable law, such interest to accrue from the date the Company
receives the Executive's statement for such fees and expenses
through the date of payment thereof; provided, however, that in
the event the resolution of any such contest or dispute includes
a finding denying, in total, the Executive's claims in such
contest or dispute, the Executive shall be required to reimburse
the Company, over a period of 12 months from the date of such
resolution, for all sums advanced to the Executive pursuant to
this Section 6.
7. Operative Event. Notwithstanding any provision
herein to the contrary, no amounts shall be payable hereunder
unless and until there is a Change in Control at a time when the
Executive is employed by the Company.
8. Termination of Severance Policy. (a) This
Severance Policy shall be effective on the date hereof and shall
continue until terminated by the Company as provided in paragraph
(b) of this Section 8; provided, however, that this Severance
Policy shall terminate in any event with respect to each
Executive upon the first to occur of (i) the Executive's 70th
birthday, (ii) the Executive's death and (iii) termination of the
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Executive's employment with the Company prior to a Change in
Control.
(b) The Company shall have the right prior to a Change
in Control, in its sole discretion, pursuant to action by the
Board, to approve the termination of this Severance Policy with
respect to any or all of the Executives, which termination shall
not become effective until the date fixed by the Board for such
termination, which date shall be at least 120 days after notice
thereof is given by the Company to the Executive with respect to
whom this Severance Policy is being terminated; provided,
however, that no such action shall be taken by the Board during
any period of time when the Board has knowledge that any person
has taken steps reasonably calculated to effect a Change in
Control until, in the opinion of the Board, such person has
abandoned or terminated its efforts to effect a Change in
Control; and provided further, that in no event shall this
Severance Policy be terminated in the event of a Change in
Control.
9. Scope of Severance Policy. Nothing in this
Severance Policy shall be deemed to entitle any Executive to
continued employment with the Company or its subsidiaries, and if
any Executive's employment with the Company shall terminate prior
to a Change in Control, then the Executive shall have no further
rights hereunder; provided, however, that any termination of an
Executive's employment following a Change in Control shall be
subject to all of the provisions of this Severance Policy.
10. Successors. (a) This Severance Policy shall not
be terminated by any merger or consolidation of the Company
whereby the Company is or is not the surviving or resulting
corporation or as a result of any transfer of all or
substantially all of the assets of the Company. In the event of
any such merger, consolidation or transfer of assets, the
provisions of this Severance Policy shall be binding upon the
surviving or resulting corporation or the person or entity to
which such assets are transferred.
(b) The Company agrees that concurrently with any
merger, consolidation or transfer of assets referred to in
paragraph (a) of this Section 10, it will cause any successor or
transferee unconditionally to assume, by written instrument
delivered to the Executive (or the Executive's beneficiary or
estate), all of the obligations of the Company hereunder.
Failure of the Company to obtain such assumption prior to the
effectiveness of any such merger, consolidation or transfer of
assets shall entitle the Executive to compensation and other
benefits from the Company in the same amount and on the same
terms as the Executive would be entitled hereunder if the
Executive's employment were terminated following a Change in
Control other than by reason of a Nonqualifying Termination. For
purposes of implementing the foregoing, the date on which any
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such merger, consolidation or transfer becomes effective shall be
deemed the Date of Termination.
(c) This Severance Policy shall be enforceable by each
Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and
legatees. If an Executive shall die while any amounts would be
payable to the Executive hereunder had the Executive continued to
live, all such amounts, unless otherwise provided herein, shall
be paid in accordance with the terms of this Severance Policy to
such person or persons appointed in writing by the Executive to
receive such amounts or, if no person is so appointed, to the
Executive's estate.
11. Full Settlement; Resolution of Disputes. (a) The
Company's obligation to make any payments provided for in this
Severance Policy and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim,
recoupment, defense or other claim, right or action which the
Company may have against an Executive or others. In no event
shall an Executive be obligated to seek other employment or take
any other action by way of mitigation of the amounts payable to
the Executive under any of the provisions of this Severance
Policy and such amounts shall not be reduced whether or not the
Executive obtains other employment.
(b) If there shall be any dispute between the Company
and an Executive in the event of any termination of the
Executive's employment, then, unless and until there is a final,
nonappealable judgment by a court of competent jurisdiction
declaring that such termination was for Cause, that the
determination by the Executive of the existence of Good Reason
was not made in good faith, or that the Company is not otherwise
obligated to pay any amount or provide any benefit to the
Executive and the Executive's dependents or other beneficiaries,
as the case may be, under paragraphs (a) and (b) of Section 3,
the Company shall pay all amounts, and provide all benefits, to
the Executive and the Executive's dependents or other
beneficiaries, as the case may be, that the Company would be
required to pay or provide pursuant to paragraphs (a) and (b) of
Section 3 as though such termination were by the Company without
Cause or by the Executive with Good Reason; provided, however,
that the Company shall not be required to pay any disputed
amounts pursuant to this paragraph except upon receipt of an
undertaking by or on behalf of the Executive to repay all such
amounts to which the Executive is ultimately adjudged by such
court not to be entitled.
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12. Employment with Subsidiaries. Employment with the
Company for purposes of this Severance Policy shall include
employment with any corporation or other entity in which the
Company has a direct or indirect ownership interest of 50% or
more of the total combined voting power of the then outstanding
securities of such corporation or other entity entitled to vote
generally in the election of directors.
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SCHEDULE 1
EXECUTIVES
Raymond J. Bjorseth
Robert A. Ginos
Wayne O. Hall
Lewis M. Jacobson
William J. Rotenberry
GENERAL MANAGERS
James E. Berkleland
James F. Domo
Daniel Dumont
Robert J. Lindberg
Gregory Pacton
Paul E. Prutzman
Robert J. Snyder
Thomas F. Stabosz
S. Keith Swanson
Steven L. Thunander
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Exhibit 10.5
Severance Plan For Corporate Staff
For Change In Control Situations
Plan
This Plan is adopted specifically to provide severance benefits to
Corporate Staff employees if there should be a Loss of Employment
related to a Change In Control. It shall become effective as of the date
of any Change In Control.
Irrevocable
Once a Change In Control occurs, and for one year thereafter, this Plan
cannot be amended or modified to remove, alter or cancel the provisions
and benefits of the Plan in any way.
Covered Employees
The employees in the attached schedule are covered by this Plan. No
employee may be deleted from these schedules after a Change In
Control has occurred.
Loss of Employment
Loss of Employment means that within one year following a Change In
Control, the employee is terminated for reason other than for good and
sufficient cause, death or permanent disability, or the employee
terminates employment because of (a) a relocation of regular work site
of more than 50 miles, (b) reduction in compensation, or (c) a reduction
in benefits.
Severance Payment
Within five workdays following a Loss of Employment, the employee shall
be given a lump sum severance payment (net of applicable deductions)
equal to two weeks plus one week for each completed year of service;
but not less than thirteen weeks nor more than twenty-six weeks.
Accrued, Unused Vacation
The employee shall also be paid with the severance payment an amount
equal to the employee's accrued, unused vacation.
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Payment Lieu of Profit Sharing
In addition to severance, the employee will be paid a lump sum amount
equivalent to the maximum potential Member Share of the Company Unit
Profit Sharing Contribution for the employee for the year of termination
determined as follows:
a) The employee's salary for purpose of this benefit will be
base and any bonus compensation earned during the year
up to date of termination, plus an amount equal to the pay
that would have been earned for the balance of the
calendar year after the date of termination using the higher
of the employee's pay rate at the date of Change In
Control or the date of termination.
b) the formula for the contribution will be the greater of the
formula as of date of Change In Control or date of
termination.
c) There will be no reductions in the maximum for actual
Company Unit Profit Sharing Contribution or Internal
Revenue Code limitations with respect to actual earned
income.
This payment will be reduced by any Member Share of the Company
Unit Contribution that is contributed to the employee's Profit Sharing
Plan account for the year of termination.
Employee Benefit Plan Participation
The employee (including any covered dependents) shall continue to be
covered under the Company's Group Life, Medical and Dental
coverages, for a period of time equal to the number of weeks of
severance payment plus weeks of accrued, unused vacation, subject to
Plan provisions and required contributions applicable to active
employees.
Retiree Medical
An employee Age 50 or more, and whose age and completed service
equals 75 or more at either (1) the end of the severance continuation of
Group Medical coverage (previously described) or (2) the end of any
COBRA continuation of Group Medical coverage, may elect to continue
Group medical coverage for themselves and/or eligible dependents. The
maximum continuation period is to Age 65 for the employee and any
covered spouse, and according to regular Plan provisions for covered
children. Continuation is subject to regular Plan provisions and a
required contribution equal to the rate for Early Retiree's under the
Company's Retiree Medical Plan for Plan "A" coverage, or for Plan "B"
coverage, the Early Retiree rate less the differential between Plan "A" and
Plan "B" contribution rates for active employees.
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Job Search Assistance
The Company shall provide letters of recommendation as requested.
Additionally, the Company shall provide a drawing fund of up to $500 to
reimburse the employee for job search expenses including, but not
limited to, resume preparation, copying, mailing and the cost of out-
placement services. Reimbursements will be mailed within five days of
receipt by the Company of documentary; detailed proof of covered
expense.
Expense Reimbursement
If any contest or dispute shall arise under this Plan involving termination
of a covered employee's employment with the Company or involving the
failure or refusal of the Company to perform fully in accordance with the
terms hereof, the Company shall reimburse the employee, on a current
basis, for all legal fees and expenses, if any, incurred by the employee
in connection with such contest or dispute, together with interest at a
rate equal to the rate of interest published in The Wall Street Journal
under the caption "Money Rates" as the prime rate, but in no event
higher than the maximum legal rate permissible under applicable law,
such interest to accrue from the date the Company receives the
employee's statement for such fees and expenses through the date of
payment thereof; provided, however, that in the event the resolution of
any such contest or dispute includes a finding denying, in total, the
employee's claims in such contest or dispute, the employee shall be
required to reimburse the Company, over a period of 12 months from
the date of such resolution, for all sums advanced to the employee
pursuant hereto.
Change In Control Defined
As used in this Plan, Change in Control means:
(1) the acquisition by any individual, entity or group (a
"Person"), including any "person" within the meaning of Section 13(d)(3)
or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), of beneficial ownership within the meaning of Rule 13d-
3 promulgated under the Exchange Act, of 25% or more of either (i) the
then outstanding common shares of the Company (the "Outstanding
Company Common Shares") or (ii) the combined voting power of the
then outstanding securities of the Company entitled to vote generally in
the election of directors (the "Outstanding Company Voting Securities");
provided, however, that the following acquisitions shall not constitute a
Change in Control: (A) any acquisition directly from the Company
(excluding any acquisition resulting from the exercise of a conversion or
exchange privilege in respect of outstanding convertible or exchangeable
securities), (B) any acquisition by the Company, (C) any acquisition by
an employee benefit plan (or related trust) sponsored or maintained by
the Company or any corporation controlled by the Company, or (D) any
acquisition by any corporation pursuant to a reorganization, merger or
consolidation involving the Company, if, immediately after such
reorganization,
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merger or consolidation, each of the conditions described in clauses (i),
(ii) and (iii) of subsection (3) of this definition shall be satisfied; and
provided further that, for purposes of clause (B), if any Person (other than
the Company or any employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company) shall
become the beneficial owner of 25% or more of the Outstanding Company Common
Shares or 25% or more of the Outstanding Company Voting Securities by reason
of an acquisition by the Company and such Person shall, after such
acquisition by the Company, become the beneficial owner of any
additional shares of the Outstanding Company Common Shares or any
additional Outstanding Voting Securities and such beneficial ownership
is publicly announced, such additional beneficial ownership shall
constitute a Change in Control;
(2) individuals who, as of the date of adoption of this
Plan, constitute the Board of Directors of the Company (the "Incumbent
Board") cease for any reason to constitute at least a majority of such
Board of Directors of the Company (the "Board"); provided, however,
that any individual who becomes a director of the Company subsequent
to the date hereof whose election, or nomination for election by the
Company's shareholders, was approved by the vote of at least a
majority of the directors then comprising the Incumbent Board shall be
deemed to have been a member of the Incumbent Board; and provided
further, that no individual who was initially elected as a director of the
Company as a result of an actual or threatened election contest, as such
terms are used in Rule 14a-11 of Regulation 14A promulgated under the
Exchange Act, or any other actual or threatened solicitation of proxies
or consents by or on behalf of any Person other than the Board shall be
deemed to have been a member of the Incumbent Board;
(3) approval by the shareholders of the Company of a
reorganization, merger or consolidation unless, in any such case,
immediately after such reorganization, merger or consolidation, (i) more
than 60% of the then outstanding shares of common stock of the
corporation resulting from such reorganization, merger or consolidation
and more than 60% of the combined voting power of the then
outstanding securities of such corporation entitled to vote generally in
the election of directors is then beneficially owned, directly or indirectly,
by all or substantially all of the individuals or entities who were the
beneficial owners, respectively, of the Outstanding Company Common
Shares and the Outstanding Company Voting Securities immediately
prior to such reorganization, merger or consolidation and in substantially
the same proportions relative to each other as their ownership,
immediately prior to such reorganization, merger or consolidation, of the
Outstanding Company Common Shares and the Outstanding Company
Voting Securities, as the case may be, (ii) no Person (other than the
Company, any employee benefit plan (or related trust) sponsored or
maintained by the Company or the corporation resulting from such
reorganization, merger or consolidation (or any corporation controlled by
the Company) and any Person which beneficially owned, immediately
prior to such reorganization, merger or consolidation, directly or
indirectly, 25% or more of the Outstanding Company Common Shares
or the Outstanding Company Voting Securities, as the case may be)
beneficially owns, directly or indirectly, 25% or more of the then
outstanding shares of common stock of such corporation or 25% or
more of the
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combined voting power of the then outstanding securities
of such corporation entitled to vote generally in the election of directors
and (iii) at least a majority of the members of the board of directors of
the corporation resulting from such reorganization, merger or
consolidation were members of the Incumbent Board at the time of the
execution of the initial agreement or action of the Board providing for
such reorganization, merger or consolidation; or
(4) approval by the shareholders of the Company of (i)
a plan of complete liquidation or dissolution of the Company or (ii) the
sale or other disposition of all or substantially all of the assets of the
Company other than to a corporation with respect to which, immediately
after such sale or other disposition, (A) more than 60% of the then
outstanding shares of common stock thereof and more than 60% of the
combined voting power of the then outstanding securities thereof entitled
to vote generally in the election of directors is then beneficially owned,
directly or indirectly, by all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the Outstanding
Company Common Shares and the Outstanding Company Voting
Securities immediately prior to such sale or other disposition and in
substantially the same proportions relative to each other as their
ownership, immediately prior to such sale or other disposition, of the
Outstanding Company Common Shares and the Outstanding Company
Voting Securities, as the case may be, (B) no Person (other than the
Company, any employee benefit plan (or related trust) sponsored or
maintained by the Company or such corporation (or any corporation
controlled by the Company) and any Person which beneficially owned,
immediately prior to such sale or other disposition, directly or indirectly,
25% or more of the Outstanding Company Common Shares or the
Outstanding Company Voting Securities, as the case may be)
beneficially owns, directly or indirectly, 25% or more of the then
outstanding shares of common stock thereof or 25% or more of the
combined voting power of the then outstanding securities thereof entitled
to vote generally in the election of directors and (C) at least a majority
of the members of the board of directors thereof were members of the
Incumbent Board at the time of the execution of the initial agreement or
action of the Board providing for such sale or other disposition.
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INDIVIDUALS TO BE COVERED BY SEVERANCE PLAN FOR CORPORATE STAFF
James J. Bradley
Vivian Curran
Charles P. Erbon
Carl S. Grabinski
James S. Horton
Herbert J. Marros
Gysbert L. Menninga
Charles J. Moxley
Rachel A. Murdock
Robert L. Nelson
Carrie L. Reif
Irene M. Brajner
Laura A. Calkins
Norine M. Hackhel
Conchetta Z. Holt
Karen M. Horne
Katherine Hudzinski
Pamela L. Jarmusz
Hazel Krikorian
Ann M. Laudermilk
Rosalinda V. Luz
Raymond A. Pisarczyk
Pamela Price-Adams
Amanda Slavik
Rose Spolar
Charlotte Sprenger
Marcene L. Young
124
Exhibit 10.6
September 16, 1994 Amendment to Executive Management Incentive Plan
Amendment Adding Section J: Change in Control
In the event of a "Change in Control" (as defined hereinafter) occurs,
and if this Plan is reduced or terminated in its entirety or for any
covered executive or executives in the calendar year in which the
Change in Control occurs, such covered executive or executives
shall be entitled to a proportional award payment as follows:
Award Payment at 100% Plan Accomplishment level
(one-half maximum potential award) times a fraction for
the calendar year with a denominator equal to the
number of months (including any partial month as a
whole month) prior to such reduction or termination
and a denominator equal to twelve.
Once a Change in Control occurs, the Plan cannot be amended or
modified to remove, alter or cancel the provisions of this section in
any way.
As used in this Plan, Change in Control means:
(1) the acquisition by any individual, entity or group (a
"Person"), including any "person" within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), of beneficial ownership within the
meaning of Rule 13d-3 promulgated under the Exchange Act, of 25%
or more of either (i) the then outstanding common shares of the
Company (the "Outstanding Company Common Shares") or (ii) the
combined voting power of the then outstanding securities of the
Company entitled to vote generally in the election of directors (the
"Outstanding Company Voting Securities"); provided, however, that
the following acquisitions shall not constitute a Change in Control:
(A) any acquisition directly from the Company (excluding any
acquisition resulting from the exercise of a conversion or exchange
privilege in respect of outstanding convertible or exchangeable
securities), (B) any acquisition by the Company, (C) any acquisition
by an employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the
Company, or (D) any acquisition by any corporation pursuant to a
reorganization, merger or consolidation involving the Company, if,
immediately after such reorganization, merger or consolidation, each
of the conditions described in clauses (i), (ii) and (iii) of subsection
(3) of this definition shall be satisfied; and provided further that, for
purposes of clause (B), if any Person (other than the Company or
any employee benefit plan (or related trust) sponsored or maintained
by the Company or any corporation controlled by the Company)
shall become the beneficial owner of 25% or more of the
Outstanding Company Common Shares or 25% or more of the
Outstanding Company Voting Securities by reason of an acquisition
by the Company and such Person shall, after such acquisition by the
Company, become the beneficial owner of any additional shares of
the
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<PAGE>
Outstanding Company Common Shares or any additional
Outstanding Voting Securities and such beneficial ownership is
publicly announced, such additional beneficial ownership shall
constitute a Change in Control;
(2) individuals who, as of the date of adoption of this Plan,
constitute the Board of Directors of the Company (the "Incumbent
Board") cease for any reason to constitute at least a majority of such
Board of Directors of the Company (the "Board"); provided, however,
that any individual who becomes a director of the Company
subsequent to the date hereof whose election, or nomination for
election by the Company's shareholders, was approved by the vote
of at least a majority of the directors then comprising the Incumbent
Board shall be deemed to have been a member of the Incumbent
Board; and provided further, that no individual who was initially
elected as a director of the Company as a result of an actual or
threatened election contest, as such terms are used in Rule 14a-11
of Regulation 14A promulgated under the Exchange Act, or any
other actual or threatened solicitation of proxies or consents by or
on behalf of any Person other than the Board shall be deemed to
have been a member of the Incumbent Board;
(3) approval by the shareholders of the Company of a
reorganization, merger or consolidation unless, in any such case,
immediately after such reorganization, merger or consolidation, (i)
more than 60% of the then outstanding shares of common stock of
the corporation resulting from such reorganization, merger or
consolidation and more than 60% of the combined voting power of
the then outstanding securities of such corporation entitled to vote
generally in the election of directors is then beneficially owned,
directly or indirectly, by all or substantially all of the individuals or
entities who were the beneficial owners, respectively, of the
Outstanding Company Common Shares and the Outstanding
Company Voting Securities immediately prior to such reorganization,
merger or consolidation and in substantially the same proportions
relative to each other as their ownership, immediately prior to such
reorganization, merger or consolidation, of the Outstanding
Company Common Shares and the Outstanding Company Voting
Securities, as the case may be, (ii) no Person (other than the
Company, any employee benefit plan (or related trust) sponsored or
maintained by the Company or the corporation resulting from such
reorganization, merger or consolidation (or any corporation
controlled by the Company) and any Person which beneficially
owned, immediately prior to such reorganization, merger or
consolidation, directly or indirectly, 25% or more of the Outstanding
Company Common Shares or the Outstanding Company Voting
Securities, as the case may be) beneficially owns, directly or
indirectly, 25% or more of the then outstanding shares of common
stock of such corporation or 25% or more of the combined voting
power of the then outstanding securities of such corporation entitled
to vote generally in the election of directors and (iii) at least a
majority of the members of the board of directors of the corporation
resulting from such reorganization, merger or consolidation were
members of the Incumbent Board at the time of the execution of the
initial agreement or action of the Board providing for such
reorganization, merger or consolidation; or
126
<PAGE>
(4) approval by the shareholders of the Company of (i) a
plan of complete liquidation or dissolution of the Company or (ii) the
sale or other disposition of all or substantially all of the assets of the
Company other than to a corporation with respect to which,
immediately after such sale or other disposition, (A) more than 60%
of the then outstanding shares of common stock thereof and more
than 60% of the combined voting power of the then outstanding
securities thereof entitled to vote generally in the election of directors
is then beneficially owned, directly or indirectly, by all or substantially
all of the individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities immediately prior to such
sale or other disposition and in substantially the same proportions
relative to each other as their ownership, immediately prior to such
sale or other disposition, of the Outstanding Company Common
Shares and the Outstanding Company Voting Securities, as the case
may be, (B) no Person (other than the Company, any employee
benefit plan (or related trust) sponsored or maintained by the
Company or such corporation (or any corporation controlled by the
Company) and any Person which beneficially owned, immediately
prior to such sale or other disposition, directly or indirectly, 25% or
more of the Outstanding Company Common Shares or the
Outstanding Company Voting Securities, as the case may be)
beneficially owns, directly or indirectly, 25% or more of the then
outstanding shares of common stock thereof or 25% or more of the
combined voting power of the then outstanding securities thereof
entitled to vote generally in the election of directors and (C) at least
a majority of the members of the board of directors thereof were
members of the Incumbent Board at the time of the execution of the
initial agreement or action of the Board providing for such sale or
other disposition.
127
Exhibit 10.7
September 16, 1994 Amendment to Parity Plan
Adding to Section 4.2.5
In the event of a "Change In Control" occurs and if this Plan is
terminated, suspended, or contribution rates reduced for any or all
participating employees, a "Plan Change," the current year's Accrued
Payment for affected participants shall be protected as follows:
a. Participants with respect to this Accrued Payment shall be
those participating in the Plan immediately prior to the
Change In Control.
b. The payment shall be determined utilizing the contribution
rates in effect prior to the Plan Change.
c. Participants' compensation for determining the Accrued
Payment shall not be less than the Participant's
compensation paid and accrued as of date of Plan
Change including a pro-rata share of any bonus paid or
payable for the calendar year.
d. The pro-rata share of any bonus for the calendar year of
Plan Change shall be determined using a numerator equal
to the months (including any partial month as a whole
month) prior to the Plan Change and denominator equal to
the number of whole months in the calendar year ending
on the earlier of (1) the date the participant's employment
is terminated, (2) the date the participant's bonus
opportunity is effectively reduced or terminated, or (3) the
end of the calendar year; provided however that the
fraction cannot be greater than 1.0.
e. Once a Change In Control occurs, and for the calendar
year in which the Change In Control occurs and the next
following calendar year, the Plan cannot be amended or
modified to remove, alter or cancel the provisions of this
section in any way.
f. As used in this Plan, Change in Control means:
(1) the acquisition by any individual, entity or group (a
"Person"), including any "person" within the
meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the
"Exchange Act"), of beneficial ownership within the
meaning of Rule 13d-3 promulgated under the
Exchange Act, of 25% or more of either (i) the then
outstanding common shares of the Company (the
"Outstanding Company Common Shares") or (ii) the
combined voting power of the then outstanding
securities of the Company
128
<PAGE>
entitled to vote generally
in the election of directors (the "Outstanding
Company Voting Securities"); provided, however,
that the following acquisitions shall not constitute a
Change in Control: (A) any acquisition directly from
the Company (excluding any acquisition resulting
from the exercise of a conversion or exchange
privilege in respect of outstanding convertible or
exchangeable securities), (B) any acquisition by the
Company, (C) any acquisition by an employee
benefit plan (or related trust) sponsored or
maintained by the Company or any corporation
controlled by the Company, or (D) any acquisition
by any corporation pursuant to a reorganization,
merger or consolidation involving the Company, if,
immediately after such reorganization, merger or
consolidation, each of the conditions described in
clauses (i), (ii) and (iii) of subsection (3) of this
definition shall be satisfied; and provided further
that, for purposes of clause (B), if any Person
(other than the Company or any employee benefit
plan (or related trust) sponsored or maintained by
the Company or any corporation controlled by the
Company) shall become the beneficial owner of
25% or more of the Outstanding Company
Common Shares or 25% or more of the
Outstanding Company Voting Securities by reason
of an acquisition by the Company and such Person
shall, after such acquisition by the Company,
become the beneficial owner of any additional
shares of the Outstanding Company Common
Shares or any additional Outstanding Voting
Securities and such beneficial ownership is publicly
announced, such additional beneficial ownership
shall constitute a Change in Control;
(2) individuals who, as of the date of adoption of this
Plan, constitute the Board of Directors of the
Company (the "Incumbent Board") cease for any
reason to constitute at least a majority of such
Board of Directors of the Company (the "Board");
provided, however, that any individual who
becomes a director of the Company subsequent to
the date hereof whose election, or nomination for
election by the Company's shareholders, was
approved by the vote of at least a majority of the
directors then comprising the Incumbent Board
shall be deemed to have been a member of the
Incumbent Board; and provided further, that no
individual who was initially elected as a director of
the Company as a result of an actual or threatened
election contest, as such terms are used in Rule
14a-11 of Regulation 14A promulgated under the
Exchange Act, or any other actual or threatened
solicitation of proxies or consents by or on behalf
of any Person other than the Board shall be
deemed to have been a member of the Incumbent
Board;
129
<PAGE>
(3) approval by the shareholders of the Company of a
reorganization, merger or consolidation unless, in
any such case, immediately after such
reorganization, merger or consolidation, (i) more
than 60% of the then outstanding shares of
common stock of the corporation resulting from
such reorganization, merger or consolidation and
more than 60% of the combined voting power of
the then outstanding securities of such corporation
entitled to vote generally in the election of directors
is then beneficially owned, directly or indirectly, by
all or substantially all of the individuals or entities
who were the beneficial owners, respectively, of the
Outstanding Company Common Shares and the
Outstanding Company Voting Securities
immediately prior to such reorganization, merger or
consolidation and in substantially the same
proportions relative to each other as their
ownership, immediately prior to such
reorganization, merger or consolidation, of the
Outstanding Company Common Shares and the
Outstanding Company Voting Securities, as the
case may be, (ii) no Person (other than the
Company, any employee benefit plan (or related
trust) sponsored or maintained by the Company or
the corporation resulting from such reorganization,
merger or consolidation (or any corporation
controlled by the Company) and any Person which
beneficially owned, immediately prior to such
reorganization, merger or consolidation, directly or
indirectly, 25% or more of the Outstanding
Company Common Shares or the Outstanding
Company Voting Securities, as the case may be)
beneficially owns, directly or indirectly, 25% or more
of the then outstanding shares of common stock of
such corporation or 25% or more of the combined
voting power of the then outstanding securities of
such corporation entitled to vote generally in the
election of directors and (iii) at least a majority of
the members of the board of directors of the
corporation resulting from such reorganization,
merger or consolidation were members of the
Incumbent Board at the time of the execution of the
initial agreement or action of the Board providing
for such reorganization, merger or consolidation; or
(4) approval by the shareholders of the Company of (i)
a plan of complete liquidation or dissolution of the
Company or (ii) the sale or other disposition of all
or substantially all of the assets of the Company
other than to a corporation with respect to which,
immediately after such sale or other disposition, (A)
more than 60% of the then outstanding shares of
common stock thereof and more than 60% of the
combined voting power of the then outstanding
securities thereof entitled to vote generally in the
election of directors is then beneficially owned,
directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company
Common Shares and the
130
<PAGE>
Outstanding Company Voting Securities immediately prior to
such sale or other disposition and in substantially the same
proportions relative to each other as their
ownership, immediately prior to such sale or other
disposition, of the Outstanding Company Common
Shares and the Outstanding Company Voting
Securities, as the case may be, (B) no Person
(other than the Company, any employee benefit
plan (or related trust) sponsored or maintained by
the Company or such corporation (or any
corporation controlled by the Company) and any
Person which beneficially owned, immediately prior
to such sale or other disposition, directly or
indirectly, 25% or more of the Outstanding
Company Common Shares or the Outstanding
Company Voting Securities, as the case may be)
beneficially owns, directly or indirectly, 25% or more
of the then outstanding shares of common stock
thereof or 25% or more of the combined voting
power of the then outstanding securities thereof
entitled to vote generally in the election of directors
and (C) at least a majority of the members of the
board of directors thereof were members of the
Incumbent Board at the time of the execution of the
initial agreement or action of the Board providing
for such sale or other disposition.
131
Exhibit 20
FOR IMMEDIATE RELEASE
Chicago, Illinois - September 16, 1994 - Joslyn Corporation
today announced that it anticipates taking a third quarter charge
against earnings for increased environmental reserves principally
to cover costs likely to be incurred in the clean-up of a site
formerly operated in Oklahoma. Based upon currently available
information, Joslyn believes the charge will be as large as $30
million to $35 million, pre-tax.
Joslyn's estimate is based on Joslyn's own preliminary
investigation and information recently obtained from the United
States Environmental Protection Agency (USEPA) concerning a
former wood treating site located in Panama, Oklahoma, together
with Joslyn's ongoing reevaluation of its environmental reserves.
As previously reported, Joslyn was first notified by the USEPA
that it is a potentially responsible party (PRP) at the Oklahoma
site on July 27, 1994. Joslyn sold the Oklahoma site in 1955, after
operating it for 15 years. Although three subsequent owners have
operated a wood treating facility at the site, it initially appears that
Joslyn may be the only significant financially viable PRP and any
insurance coverage during such period may be minimal. Joslyn
believes that most of the remediation work at the Oklahoma site
would take place during a period 5 to 10 years from now.
Determining Joslyn's ultimate cost associated with remediating
sites is subject to many variables, including contributions from
other PRPs, insurance recoveries, availability of economical
remediation technologies and changes in applicable laws and
regulations. Joslyn's investigation of the Oklahoma site is still in
the preliminary stages. Accordingly, there can be no assurance that
Joslyn's estimates of its environmental liabilities will not change. If
technologies other than those assumed to be available are utilized
or if the quantity of contaminated soil is greater than that
suggested by preliminary data, remediation costs could be
significantly higher.
Joslyn established an environmental reserve with a $30 million
charge in 1987 for known sites then under investigation by
environmental agencies (none of which related to the Oklahoma
site). Currently (and before reflecting the anticipated third quarter
charge), Joslyn has approximately a net $14 million reserve after
reflecting expenditures since 1987 and insurance recoveries which
have been subsequently credited to the reserve.
Joslyn Corporation, now in its 92nd year, provides diversified
products and services primarily to the electric utility,
telecommunication, defense and industrial markets. Joslyn also
manufactures equipment for the following industries: aerospace,
building construction and petrochemical. It has approximately 2,050
employees and operates facilities in the United States and Canada.
Shares are traded over the counter. Joslyn stock is listed on the
NASDAQ National Market System. The NASDAQ symbol is
JOSL.
Media contact at Joslyn: William J. Rotenberry 312-454-2900.
132
