Exhibit 10.3
CHANGE IN CONTROL AGREEMENT
     THIS AGREEMENT, is made and entered into this 26th day of January 2006, by
and between A. M. CASTLE & CO., a Maryland corporation, with offices located at
3400 North Wolf Road, Franklin Park, Illinois 60131 (the “Company”) and MICHAEL
GOLDBERG who resides at 8 Black Oak Broad, North Oaks, Minnesota 55127
(“Executive”).
     WHEREAS, the Company desires to be assured that Executive will render
services to Company in the event of any Change in Control (as defined below);
and
     WHEREAS, Executive is willing to serve Company, but desires assurance that
he will be protected in the event of any Change in Control;
     NOW THEREFORE, in consideration of the mutual covenants and promise
contained herein, the parties agree as follows:
        1. If:

  a.   There is a Change in Control of Company; and     b.   After the date of
such Change in Control:

  •   Executive’s Duties and/or responsibilities have been (i) substantially
changed or (ii) reduced; or     •   Executive has been transferred or relocated
outside the Chicago metropolitan area; or     •   Executive’s Compensation has
been reduced; and

  c.   Within 24 months of the Change in Control, Executive voluntarily
terminates his employment or Executive’s employment is terminated by the Company
for any reason other than discharge for Cause, death or Disability,

    then subject to the limitations and conditions of paragraphs 3 and 4 of this
Agreement, Company shall provide the benefits described in paragraph 2 of this
Agreement (in lieu of any severance benefits under Executive’s
Employment/Non-Competition Agreement or under any Company severance plan).

 

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2. Subject to the conditions described in paragraph 1 of this Agreement, Company
shall provide and Executive shall receive the following:

  a.   A lump sum cash payment in the amount of two times the sum of
(i) Executive’s annual base salary as of the date of the Change in Control plus
(ii) the target incentive compensation for that same year. Such lump sum shall
be payable as soon as practicable after Executive’s date of termination, unless
the Company reasonably determines that Section 409A of the Internal Revenue Code
of 1986, as amended (the “Code”) will result in the imposition of additional tax
on account of the payment of this lump sum cash payment before the expiration of
the 6-month period described in Section 409A(a)(2)(B)(i) (relating to the
required delay in payment to a specified employee pursuant to a separation from
service) in which case such payment will in lieu thereof be paid on the date
that is six (6) months and one (1) day following the date of the Executive’s
separation from service (as defined in Section 409A of the Code) (or, if
earlier, the date of death of the Executive) (the “Specified Employee Delayed
Payment Date”).     b.   With respect to any granted but not awarded shares
under the 2005 Performance Stock Equity Plan or any subsequent plan, the number
of shares payable to Executive as of the end of the performance cycle shall be
estimated by the Board or Directors of the Company (the “Board”) in good faith*;
the resulting number of shares shall be multiplied by a fraction, the numerator
of which is the number of whole completed months of service completed by
Executive and the denominator of which is the total number of months in the
performance cycle, except that, in determining the

 

*   With respect to shares of Performance Stock granted under Paragraph 4(d) of
his Employment/Non-Competition Agreement, in no event shall the estimated number
of shares be less than 45,000 shares. This minimum target payout does not apply
to future awards under the 2005 Performance Stock Equity Plan or any subsequent
plan.

 

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      number of shares to be awarded under the 2005 Performance Stock Equity
Plan the number of shares shall be computed by multiplying by a fraction the
numerator of which is the number of whole completed months of service completed
by the Executive and the denominator of which is 24 and he shall be treated as
having performed services for the Company from January 1, 2006. The resulting
product shall be paid to Executive as soon as practicable following Executive’s
termination of employment but in no event later than the fifteenth day of the
third month after the date of termination, unless the Company reasonable
determines that Code Section 409A will result in the imposition of additional
tax on account of such payment before the expiration of the 6-month period
described in Section 409A(a)(2)(B)(i) in which case the number of shares or
dollar amount will be in lieu thereof be paid on the Specified Employee Delayed
Payment Date.     c.   With respect to any outstanding equity compensation
awards that are subject to a vesting schedule, such awards shall be fully
vested.     d.   Continued coverage at Company’s expense under all of Company’s
medical, heath, dental, life and disability plans or, in the event Company’s
plans have been terminated, equivalent plan coverages for a period of 24 months
after such change of control; provided, however, that Executive’s right to COBRA
continuation coverage under any Company group health plan shall be reduced by
the number of months of continued coverage provided pursuant to this paragraph.
    e.   If Executive is vested in the Company’s tax-qualified benefit plan at
the time his employment terminates, he shall be entitled to an amount equal to
the actuarial equivalent of the additional amount that Executive would have
earned under such plan had he accumulated three (3) additional continuous years
of service for benefit crediting purposes. Such amount

 

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      shall be paid to Executive in an actuarially equivalent cash lump sum at
Executive’s normal retirement age (as defined in such tax-qualified defined
benefit plan), unless the Company reasonably determines that Code Section 409A
will result in the imposition of additional tax on account of such payment
before the expiration of the 6-month period described in Section
409A(a)(2)(B)(i) in which case such payment will be paid on the Specified
Employee Delayed Payment Date.     f.   A pro-rata target incentive
compensation/bonus payment for the year of termination, based on the target
level of payout for the year of termination, payable promptly following the date
of termination but in no event later than the fifteenth day of the third month
after the date of termination), unless the Company reasonably determines that
Code Section 409A will result in the imposition of additional tax on account of
such payment before the expiration of the 6-month period described in
Section 409A(a)(2)(B)(i) in which case such payment will be paid on the
Specified Employee Delayed Payment Date.     g.   Accrued vacation pay through
the date of determination or other amounts earned, accrued or owing to Executive
but not yet paid as of such date.     h.   Other benefits, if any, in accordance
with applicable plans, programs and arrangements of Company; provided, however,
that this Agreement shall be the sole source of severance benefits paid by
Company with respect to any termination of Executive’s employment covered by
this Agreement

3. If any payment or benefit made or provided to or for the benefit of Executive
in connection with this Agreement or his employment with Company or the
termination thereof (a “Payment”) is determined to be subject to the excise tax
imposed by Section 4999 of the Internal Revenue Code (or any successor to such
Section) or interest or penalties with respect to such excise tax (such excise
tax, together with any interests or penalties thereon, is herein referred to

 

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as an “Excise Tax”), then the aggregate “present value” of those Payments shall
be limited in amount to the greater of the following dollar amounts (the
“Benefit Limit”):

  a.   Three times Executive’s “base amount” less one dollar, or     b.   The
amount which yields Executive the greatest after-tax amount of Payments under
this Agreement and any other plan, program or arrangement with the Company after
taking into account all applicable taxes on those Payments, including but not
limited to the excise tax imposed Section 4999 of the Code.

For purposes of applying the Benefit Limit, the definitions (for such terms as
“base amount” and “present value”) and rules set forth in the Treasury
Regulations promulgated under Section 280G of the Code shall apply. The amount
of the Benefit Limit shall promptly be determined by an independent accounting
firm selected by the parties and paid for by Company. Once any disputes have
been resolved, then to the extent the aggregate present value of any amounts
contingent on a Change in Control exceed the Benefit Limit, then Executive’s
cash based Severance Benefits will first be reduced as selected by Executive,
and then, if necessary. Executive’s other benefits (based on their parachute
value under Section 280G of the Code) shall be reduced to the extent necessary
to assure that the Benefit Limit is not exceeded. In the event amount determined
under “b” above is greater than that determined under “a” above. Executive shall
be responsible for any excise taxes on any benefits payable pursuant to this
paragraph.
     4. In consideration of the mutual covenants and agreements contained in
this Agreement, Executive agrees to comply with the “Non-Compete” and
“Confidential and Proprietary Information” covenants and Company agrees to
comply with the “Indemnification” covenants set forth in Executive’s
Employment/Non-Competition Agreement.

 

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5. Executive shall have no duty to mitigate his damages by seeking other
employment. Should Executive actually receive other payments from any other
employment, the payments called for hereunder shall not be reduced or offset by
any such future earnings.
6. As used herein, the following definitions shall apply:

  a.   The term “Change in Control” shall mean either:

  i.   Ownership, whether direct or indirect, of shares in excess of 25% of the
outstanding shares of common stock of Company by a person or group of persons
other than the Simpson Estates; or     ii.   The occurrence of any transaction
relating to Company required to be described pursuant to the requirements of
Item 14 of Schedule 14A under Regulation 14(a) of the Securities Exchange Act of
1934 as promulgated by Securities and Exchange Commission or Item 5.01 of Form
8-K as promulgated by the Securities and Exchange Commissions.     iii.   Any
change in the composition of the Board over a two-year period which results in a
majority of the then present directors of Company not constituting a majority
two years later, provided that in making such determination, directors who are
elected by or upon the recommendation of the then current majority of the Board
shall be excluded.

  b.   All other capitalized terms used herein without definition shall have the
same meanings as set forth in Executive’s Employment/Non- Competition Agreement.

7. This Agreement shall be binding upon and shall inure to the benefit of the
respective successors, assigns, legal representatives and heirs to the parties
hereto.
8. This Agreement shall terminate if Executive, prior to any acquisition or
Change in Control announced in a Company press release, voluntarily resigns,
retires, become

 

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permanently and totally Disabled, or dies. This Agreement shall also terminate
if Executive’s employment is terminated, prior to any announced acquisition or
Change in Control, by the Board, unless Executive can reasonably demonstrate
that such termination of employment (i) was at the request of a third party who
has taken steps reasonably calculated to effect the Change of Control or
(ii) otherwise arose in direct anticipation of the Change of Control.

                  A. M. CASTLE & CO.    
 
           
 
  By:   /s/ John McCartney    
 
           
 
  Title:   Lead Director    
 
                MICHAEL GOLDBERG    
 
                /s/ Michael Goldberg                   Executive