Document:

Exhibit 10.5

 

SMURFIT-STONE CONTAINER CORPORATION

2009 LONG-TERM INCENTIVE PLAN

 

ARTICLE I

PURPOSE OF THE PLAN

 

The Smurfit-Stone Container Corporation 2009 Long-Term Incentive Plan
(the “Plan”) is hereby established by the Compensation Committee of Smurfit-Stone
Container Corporation (the “Company”), effective as of the confirmation date of
a plan of reorganization in the Bankruptcy Proceedings or such earlier date as
established by the Committee.  The Plan
is designed to align the interests of the recipients of awards under this Plan
with the interests of the key economic stakeholders in the Company by providing
to such recipients incentive compensation based on the Company’s achievement of
its 2009-2010 financial performance and restructuring goal.  Payments under the Plan are intended to be
exempt from section 409A of the Internal Revenue Code of 1986, as amended, as “short-term
deferrals” within the meaning of Treasury Regulation section
1.409A-1(b)(4).  The Plan shall not
create any contractual right of any individual to any amount prior to the
payment of such amount.

 

ARTICLE II

DEFINITIONS

 

For purposes of this Plan, the following terms, when capitalized, shall
have the meanings set forth below:

 

Section 2.1.           “Award Statement” means a letter or other writing (including in
electronic format) provided by the Company to a Participant that sets forth,
among other things, the LTIP Incentive Bonus that the Participant is eligible
to earn under the Plan, the Financial Performance Goal and the Restructuring Goal.

 

Section 2.2.           “Bankruptcy
Proceedings” shall mean the bankruptcy proceedings in the United States
Bankruptcy Court for the District of Delaware with respect to In re:
Smurfit-Stone Container Corporation, et al., Case No. 09-10235 (BLS).

 

Section 2.3.           “Board” means
the Board of Directors of the Company.

 

Section 2.4.           “Cause” shall
mean: (a) the refusal or continued failure by the Participant to perform
substantially all his or her duties with the Company (other than any failure
resulting from incapacity due to physical or mental illness) after the Company
provides the Participant a demand for substantial performance identifying in
reasonable detail the manner in which the Participant has not substantially
performed his or her duties; (b) a plea of guilty or nolo contendere by
the Participant, or conviction of the Participant, for a felony; or (c) the
determination by the Committee in its sole discretion that the Participant has
engaged in: (1) illegal conduct or gross misconduct in connection with the
Participant’s job duties or the business of the Company; (2) a material
breach of any written policy of the Company; (3) fraud or material
dishonesty in connection with the business of the Company; or (4) any
violation of a statutory or common law duty of loyalty to the Company.

 

Section 2.5.           “Change in
Control” means the occurrence of any one or more of the following:

 

 

(a)           The “beneficial ownership” of
securities representing more than 20% of the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the
election of directors (the “Company Voting Securities”) is accumulated, held or
acquired by a Person (as defined in Section 3(a)(9) of the Exchange
Act, as modified, and used in Sections 13(d) and 14(d) thereof) other
than the Company, any trustee or other fiduciary holding securities under an
employee benefit plan of the Company, any corporation owned, directly or
indirectly, by the Company’s stockholders in substantially the same proportions
as their ownership of stock of the Company; provided, however, that any
acquisition from the Company or any acquisition pursuant to a transaction that
complies with clauses (i), (ii) and (iii) of subparagraph (c) of
this definition will not be a Change in Control under this subparagraph (a),
and provided further that immediately prior to such accumulation, holding or
acquisition, such person was not a direct or indirect beneficial owner of 20%
or more of the Company Voting Securities; or

 

(b)           Individuals who, as of January 1,
2009, constitute the Board of Directors (the “Incumbent Board”) cease for any
reason to constitute at least a majority of the Board; provided, however, that
an individual becoming a director subsequent to that date whose election, or
nomination for election by the Company’s stockholders, was approved by a vote
of at least a majority of the directors then comprising the Incumbent Board
will be considered as though such individual were a member of the Incumbent
Board, but excluding, for this purpose, any such individual whose initial
assumption of office occurs as a result of an actual or threatened election
contest with respect to the election or removal of directors or other actual or
threatened solicitation of proxies or consents by or on behalf of a Person
other than the Board; or

 

(c)           Consummation by the Company of a
reorganization, merger or consolidation, or sale or other disposition of all or
substantially of all the assets of the Company or the acquisition of assets or
stock of another entity (a “Business Combination”), in each case, unless
immediately following such Business Combination: (i) more than 60% of the
combined voting power of then outstanding voting securities entitled to vote
generally in the election of directors of (A) the corporation resulting
from such Business Combination (the “Surviving Corporation”), or (B) if
applicable, a corporation that as a result of such transaction owns the Company
or all or substantially all of the Company’s assets either directly or through
one or more subsidiaries (the “Parent Corporation”), is represented, directly
or indirectly, by Company Voting Securities outstanding immediately prior to
such Business Combination (or, if applicable, is represented by shares into
which such Company Voting Securities were converted pursuant to such Business
Combination), and such voting power among the holders thereof is in
substantially the same proportions as their ownership, immediately prior to
such Business Combination, of the Company Voting Securities; (ii) no person
(excluding any employee benefit plan (or related trust) of the Company or such
corporation resulting from such Business Combination) beneficially owns,
directly or indirectly, 20% or more of the combined voting power of the then
outstanding voting securities eligible to elect directors of the Parent
Corporation (or, if there is no Parent Corporation, the Surviving Corporation)
except to the extent that such ownership of the Company existed prior to the
Business Combination; and (iii) at least a majority of the members of the
board of directors of the Parent Corporation (or, if there is no Parent
Corporation, the Surviving Corporation) were members of the incumbent Board at
the time of the execution of the initial agreement, or of the action of the Board,
providing for such Business Combination;

 

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(d)           The consummation of a complete
liquidation or dissolution of the Company approved by the Company’s
stockholders;

 

(e)           The consummation of a reorganization
under the U.S. Bankruptcy Code; or

 

(f)            The consummation of a complete
liquidation or dissolution of the Company under the U.S. Bankruptcy Code.

 

However,
in no event will a Change in Control be deemed to have occurred, with respect
to a Participant’s Award, if the Participant is part of a purchasing group that
consummates the Change in Control transaction. 
A Participant will be deemed “part of a purchasing group” for purposes
of the preceding sentence if the Participant is an equity participant in the purchasing
company or group (except: (i) passive ownership of less than 2% of the
stock of the purchasing company; or (ii) ownership of equity participation
in the purchasing company or group that is otherwise not significant, as
determined prior to the Change in Control by a majority of the non-employee
continuing directors).

 

Section 2.6.           “Committee”
means the Compensation Committee of the Company, or any successor thereto or
delegate thereof with the authority to act on behalf of the Committee with
respect to this Plan.

 

Section 2.7.           “Company” means
the Smurfit-Stone Container Corporation and includes any successor thereto,
including pursuant to a plan of reorganization under the U.S. Bankruptcy Code.

 

Section 2.8.           “Disability”
means an individual’s long-term disability as defined under the long-term
disability plan of the Company that covers that individual; or if the
individual is not covered by such a long-term disability plan, an individual’s
disability as defined for purposes of eligibility for a disability award under
the Social Security Act.

 

Section 2.9.           “Effective Date”
shall mean the confirmation date of a plan of reorganization in the Bankruptcy
Proceedings or such earlier date as established by the Committee.

 

Section 2.10.        “Financial
Performance Goal” means financial performance goals established by the
Committee based on achievement of (a) the Company’s 2009 DCA Adjusted
EBITDAR and (b) the Company’s budgeted EBITDAR for calendar year 2010
(pro-rated as appropriate for any partial 2010 calendar year).

 

Section 2.11.        “LTIP Incentive
Bonus Award” means the cash incentive bonus awarded to a Participant under the
Plan, which bonus is subject to the Company’s achievement of the Financial
Performance Goal and the Restructuring Goal, with the total amount of such
bonus, as determined by the Committee, to be payable with respect to (a) the
achievement of the Financial Performance Goal, based upon 50% of the
Participant’s LTIP Incentive Bonus Target and (b) the achievement of the
Restructuring Goal, based upon the remaining 50% of the Participant’s LTIP
Incentive Bonus Target, in each case as described in Article IV of this
Plan.

Section 2.12.        “LTIP Incentive
Bonus Target” means the amount, as determined by the Committee, that a
Participant will receive if the Company achieves the Financial Performance Goal
at 100% of target, multiplied by two.

 

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Section 2.13.        “Participant”
means an employee of the Company who satisfies the requirements of Section 3.1
for eligibility to participate in the Plan.

 

Section 2.14.        “Payment Date”
means the date on which all or a portion of the LTIP Incentive Bonus Award is
paid to a Participant.

 

Section 2.15.        “Plan” means
this Smurfit-Stone Container Corporation 2009 Long-Term Incentive Plan, as
amended from time to time.

 

Section 2.16.        “Restructuring
Goal” shall mean that the weighted average of the closing trading prices of the
Debtors’ series of five publicly traded bonds over the 30-calendar-day period
preceding the Effective Date is not less than fifty cents ($0.50).

 

Section 2.17.        “Retirement”
shall mean (i) in the case of a Participant with an employment agreement
or comparable agreement with the Company, the Participant’s “retirement” as
defined in such agreement, and (ii) in the case of a Participant with no
employment agreement or comparable agreement with the Company, the termination
of the Participant’s employment with the Company at or after the attainment of
age 55 and completion of at least 5 years of service with the Company.

 

ARTICLE III

ELIGIBILITY

Section 3.1.           Eligibility
Requirements.

 

(a)   Subject to Section 3.2, an individual shall be entitled to
participate in the Plan only if he or she:

 

(1)                    was employed on
or before April 28, 2009, or such later date as determined by the
Committee on a case by case basis;

 

(2)                    is designated
by the Committee as an eligible Participant; and

 

(3)                    is an employee
of the Company or one of its subsidiaries or affiliates on the Payment Date
with respect to all or a portion of the LTIP Incentive Bonus Award,

 

in
all cases as determined by the Committee.

 

(b)   In the event a Participant transfers into or otherwise assumes
another position that participates in the Plan (or does not participate in the
Plan, as the case may be), the Committee retains the sole discretion to
determine what adjustments, if any, will be made to the Participant’s LTIP
Incentive Bonus Target and/or LTIP Incentive Bonus Award.

 

Section 3.2.           Effect of
Termination of Employment.

 

(a)   Notwithstanding anything herein to the contrary, a Participant
shall not be entitled to receive the Financial Performance Goal or
Restructuring Goal portion of the LTIP Incentive Bonus Award if, prior to the
Payment Date for such portion, he or she resigns from his or her employment or
is terminated by the Company for Cause, in each case as determined by the
Committee.

 

(b)   If a Participant’s employment is terminated by the Company without
Cause on or 

 

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after January 1, 2010, any portion of the LTIP
Incentive Bonus Award earned by such Participant as if he or she had remained
employed through the Effective Date or, if applicable, December 31, 2010,
and shall be prorated on the basis of the number of calendar days during which
such Participant has been employed by the Company between January 1, 2009
and the Payment Date for such portion of the LTIP Incentive Bonus Award.

 

(c)   Unless determined otherwise by the Committee and set forth in the
Participant’s Award Statement or a written agreement between the Participant
and the Company, if a Participant’s employment is terminated prior to the
Payment Date for either the Financial Performance Goal or Restructuring Goal
portion of the LTIP Incentive Bonus Award by reason of death, Disability, or
Retirement on or after January 1, 2010, the Participant will receive a
prorated payout (to be prorated on the basis of the number of calendar days
during which such Participant has been employed by the Company between January 1,
2009 and the Payment Date for such portion of the LTIP Incentive Bonus Award)
of such portion of the LTIP Incentive Bonus Award earned by such Participant as
if he or she had remained employed through the Effective Date or, if
applicable, December 31, 2010. 
Payment of an earned portion of the LTIP Incentive Bonus Award shall be
made as provided in Section 5.1.

 

ARTICLE IV

CALCULATION OF AWARD

 

Section 4.1.           Plan Components.  The Plan will contain two components — the
Financial Performance Goal component and the Restructuring Goal component.  Each of the Financial Performance Goal and
Restructuring Goal components of a Participant’s LTIP Incentive Bonus Award
will be determined based upon 50% of the Participant’s LTIP Incentive Bonus
Target, in each case as determined by the Committee.

 

Section 4.2.           Financial
Performance Goal Component.  The Committee shall establish the Financial
Performance Goal, and the Company’s EBITDAR for calendar years 2009 and 2010
shall be measured against a scale that includes a threshold level of
performance below which no payment shall be made with respect to the Financial
Performance Goal portion of the LTIP Incentive Bonus Target, levels of
performance at which specified percentages of the Financial Performance Goal
portion of the LTIP Incentive Bonus Target shall be paid, and a maximum level
of performance above which no additional Financial Performance Goal portion of
the LTIP Incentive Bonus Target shall be paid. 
The Financial Performance Goal may be changed by the Committee in the
event of changed or unanticipated circumstances, as determined by the Committee
in its discretion.

 

Section 4.3.           Restructuring
Goal Component.  If the
Restructuring Goal is achieved, each Participant shall be paid 175% of 50% of
his or her total LTIP Incentive Bonus Target as the Restructuring Goal portion
of his or her LTIP Incentive Bonus Award. 
If the Restructuring Goal is not achieved, no Participant shall be paid
any amounts with respect to the Restructuring Goal.

 

Section 4.4.           Award
Statements.  The Company
shall provide an Award Statement to each Participant as soon as practicable
after the Effective Date.  Each Award
Statement shall be subject to the terms of the Plan and shall specify:  (i) the LTIP Incentive Bonus Target that
such 

 

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Participant
is eligible to receive; (ii) the Financial Performance Goal; (iii) the
Restructuring Goal; (iv) the impact of the attainment of various levels of
the Financial Performance Goal on the amounts to be paid to the Participant
with respect to such Financial Performance Goal; and (v) the impact of the
attainment of the Restructuring Goal on the amounts to be paid to the
Participant with respect to such Restructuring Goal, as determined by the
Committee and to the extent not inconsistent with the Company’s plan of
reorganization confirmed by the United States Bankruptcy Court for the District
of Delaware presiding over the Bankruptcy Proceeding (the “Court”) or the Court’s
confirmation order with respect thereto (the “Confirmation Order”).

 

Section 4.5.           Emergence from
Bankruptcy / Liquidation.  In
the event that the Court confirms a plan of reorganization for the Company
prior to December 31, 2010, then each Participant shall, on or within 60
days after the Effective Date,  receive (a) a
pro-rata amount (based on the ratio of the number of calendar days that
occurred during the period beginning January 1, 2009 and ending on the
Effective Date) of the Financial Performance Goal portion of the LTIP Incentive
Bonus Award, based on the Company’s actual achievement of the Financial
Performance Goal (pro-rated as appropriate for any partial 2010 calendar year)
and (b) if the Restructuring Goal has been achieved, the full amount of
the Restructuring Goal portion of the LTIP Incentive Bonus Award (without any
pro-ration) as set forth in Section 4.3 above.

 

ARTICLE V

PAYMENT OF AWARDS

 

Section 5.1.           Time of Payment.  Payment of the Financial Performance Goal
portion of the LTIP Incentive Bonus Award shall, unless paid earlier pursuant
to Section 4.5, be made on or within the 30-day period following December 31,
2010.  Payment of the Restructuring Goal
portion of the LTIP Incentive Bonus Award shall be made within the 60-day
period following the Effective Date, if the Restructuring Goal has been
achieved.

 

Section 5.2.           Form of
Payment.  The Financial Performance Goal
portion and the Restructuring Goal portion of the LTIP Incentive Bonus Award
shall each be paid in the form of a lump sum cash payment.

 

ARTICLE VI

ADMINISTRATION

 

Section 6.1.           The Plan shall
be administered by the Committee, which shall have full power and authority to
interpret, construe and administer the Plan in accordance with the provisions
set forth herein and to the extent not inconsistent with the Company’s plan of
reorganization confirmed by the Court or the Confirmation Order, including
without limitation the authority to: (i) select the Participants who are
eligible to participate in the Plan; (ii) determine, consistent with the
terms of the Plan, (A) the terms and conditions of each Award Statement, (B) the
LTIP Incentive Bonus Target that each Participant is eligible to receive, (C) the
Financial Performance Goal, (D) the level at which the Financial
Performance Goal is attained, (E) whether the Restructuring Goal has been
achieved, and (F) the impact of the attainment of various levels of the
Financial Performance Goal on the amounts to be paid to Participants with
respect to the Financial Performance Goal portion of the LTIP Incentive Bonus

 

6

 

Award;
and (iii) make any other determination and take any other action that the
Committee deems necessary or desirable for administration of the Plan.  The Committee may also delegate to any
corporation, committee or individual, regardless of whether the individual is
an employee of the Company, the duty to act for the Committee hereunder.

 

Section 6.2.           Decisions of
the Committee shall be final, conclusive and binding on all persons or
entities, including the Company and any Participant.  A majority of the members of the Committee
may determine its actions.

 

Section 6.3.           No officer or
employee of the Company shall be liable to any person for any action taken or
omitted in connection with the interpretation and administration of the Plan
unless attributable to his or her own willful misconduct or lack of good faith.

 

Section 6.4.           The expenses of
administering the Plan shall be paid by the Company and shall not be charged
against the Plan.

 

ARTICLE VII

MISCELLANEOUS

 

Section 7.1.           Successors.  All obligations of the Company under the Plan
will be binding on any successor to the Company, whether the existence of the
successor results from a Change in Control or otherwise.

 

Section 7.2.           Nontransferability.  Unless the Committee provides for the
transferability of a particular LTIP Incentive Bonus and such transferability
is specified in the Award Statement or in a document prepared by the Committee
and relating to the LTIP Incentive Bonus Target or LTIP Incentive Bonus Award,
no LTIP Incentive Bonus Award or any rights thereto shall be transferable other
than by will or the laws of descent and distribution or pursuant to any
beneficiary designation procedures as may be approved by the Committee for such
purpose.  Except to the extent permitted
by the foregoing sentence, no LTIP Incentive Bonus Award payable hereunder may
be assigned, alienated, sold, transferred, anticipated, pledged, encumbered, or
subjected to any charge or legal process, and if any such attempt is made, or a
person eligible for any LTIP Incentive Bonus Award hereunder becomes bankrupt,
the amount under the Plan which would otherwise be payable with respect to such
person may be eliminated by the Committee which, in its sole discretion, may
cause the same to be held or applied for the benefit of one or more of the
dependents of such person or make any other disposition of such amount that it
deems appropriate.

 

Section 7.3.           Beneficiary
Designation.  Each
Participant may, from time to time, name any beneficiary or beneficiaries (who
may be named contingently or successively) to whom any amount payable under the
Plan is to be paid in case the Participant should die before receiving such
amount.  Each beneficiary designation
will revoke all prior designations by the same Participant with respect to this
Plan, must be in a form prescribed by the Committee, and must be made during
the Participant’s lifetime.  If the
Participant’s designated beneficiary predeceases the Participant or no
beneficiary has been designated, any amount remaining unpaid at the Participant’s
death may, in the sole discretion of the Committee, (i) be paid to the
Participant’s estate or to one or more of the dependents of the Participant or (ii) be
disposed of in any other manner that the Committee deems appropriate.

 

Section 7.4.           Claim to LTIP
Incentive Bonus Award and Employment Rights.  Nothing 

 

7

 

in
this Plan shall require the Company to segregate or set aside any funds or
other property for purposes of paying all or any portion of a LTIP Incentive
Bonus Award hereunder.  Neither the
adoption of the Plan nor the continued operation thereof shall confer upon any
Participant any right to continue in the employ of the Company or shall in any
way affect the right and power of the Company to dismiss or otherwise terminate
the employment of any Participant at any time for any reason, with or without
cause.

 

Section 7.5.           Income Tax
Withholding/Rights of Offset.  The Company shall have the right to deduct
and withhold from any amounts paid pursuant to the Plan all federal, state,
local and other taxes as may be required by law.  In addition to the foregoing, the Company
shall have the right to set off against any amount which would otherwise be
payable hereunder, the amount of any debt, judgment, claim, expense or other
obligation owed at such time by the Participant to the Company, to the extent
permitted by law.

 

Section 7.6.           Effective Date
of Plan.  The Plan shall take effect on
the Effective Date.

 

Section 7.7.           Rights as a
Creditor.  No
Participant shall have any interest in any particular assets of the Company by
reason of the right to receive a benefit under the Plan and any such
Participant shall have only the rights of a general unsecured creditor of the
Company with respect to any rights under the Plan

 

Section 7.8.           Severability.  If any provision of the Plan is held illegal
or invalid for any reason, the illegality or invalidity will not affect the
remaining parts of the Plan, and the Plan will be construed and enforced as if
the illegal or invalid provision had not been included.

 

Section 7.9.           Governing Law.  All questions pertaining to the construction,
validity and effect of the Plan, and all questions pertaining to any amount
payable hereunder, shall be determined in accordance with the laws of the State
of Delaware.

 

8Exhibit 10.6

 

AMENDED AND RESTATED

EMPLOYMENT AGREEMENT OF PATRICK J. MOORE

 

This
Amended and Restated Employment Agreement (the “Agreement”) by and between
Patrick J. Moore (the “Executive”) and Smurfit-Stone Container Corporation (the
“Company”) shall be deemed to have been made and entered into as of the date of
the order of confirmation entered by the United States Bankruptcy Court for the
District of Delaware with respect to the Company’s plan of reorganization in
the matter of In re: Smurfit-Stone Container Corp., Case No. 09-10235
(BLS)  (the “Chapter 11 Cases”) (such plan,
the “Plan of Reorganization” and such date, the “Confirmation Date”), and shall
become effective as of the effective date of the Plan of Reorganization (the “Effective
Date”).

 

WHEREAS,
the Executive currently is employed as the Company’s Chief Executive Officer (“CEO”)
and was Chairman of the Company’s Board of Directors prior to the Effective
Date (the Company’s pre- and post-Effective Date Boards of Directors
hereinafter collectively referred to herein as the “Board”) and the Company
desires to continue to employ the Executive upon and subject to the terms and
conditions set forth herein, and the Executive wishes to accept such employment
upon and subject to such terms and conditions;

 

WHEREAS,
the Company and the Executive are parties to that certain employment agreement
effective as of April 1, 1999, which was amended effective as of January 4,
2002, July 25, 2006 and January 1, 2008 (such employment agreement,
together with subsequent amendments, referred to herein as the “Predecessor
Agreement”);

 

WHEREAS,
the Company and the Executive desire to enter into the Agreement and, in so
doing, to amend and restate the Predecessor Agreement in its entirety;

 

WHEREAS,
the Company has adopted and implemented an Equity Incentive Plan (“Equity
Incentive Plan”), as of the Confirmation Date, pursuant to the Plan of
Reorganization; and

 

WHEREAS
the Executive is a participant in the Jefferson Smurfit Corporation
Supplemental Income Pension Plan II (“SIPP II”), which was not assumed pursuant
to the Company’s Plan of Reorganization and therefore is of no further force
and effect;

 

NOW,
THEREFORE, in consideration of the promises and mutual agreements contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by both parties, the parties
hereby agree as follows:

 

1.                                      Employment
Period and Positions.  Subject to the
terms and conditions of this Agreement (including without limitation Section 5):

 

(a)                                  the Company
shall employ the Executive as its CEO from the Effective Date until the nine (9) month
anniversary of the Effective Date (hereinafter referred to as the “Retirement
Date”), provided that the Retirement Date may be accelerated to an earlier date
(i) by the Board for any reason other than Cause upon thirty (30) calendar
days’ advance written notice to the Executive specifying such accelerated
Retirement Date (ii) by the Executive if he 

 

 

terminates his employment with the Company for Good
Reason or following a Change in Control (as such terms are defined in Section 5
of this Agreement) in accordance with Section 5 of this Agreement; or (iii) due
to the Executive’s death (in which case, the Retirement Date shall be the date
of the Executive’s death); and

 

(b)                               on the
Retirement Date, the Executive shall retire voluntarily (or, as applicable, be
deemed to have retired voluntarily) from his positions and from his employment
with the Company (hereinafter referred to as the Executive’s “Retirement”), at
which time his employment with and service to the Company shall terminate (such
period of the Executive’s employment from the Effective Date until Retirement
Date (or such earlier effective date of the termination of his employment for
Cause or without Good Reason pursuant to Section 5) herein after referred
to as the “Employment Period”); provided that upon the Executive’s Retirement
or other termination of his employment, the Board shall, in accordance with its
normal procedures for election, retention and removal of directors, determine
whether the Executive shall continue his service as a member of the Board.

 

2.                                                  Duties
and Responsibilities.

 

(a)                                  During the
Employment Period, the Executive (i) shall perform the duties assigned to
him by the Board from time to time (provided that the Executive shall not be
assigned tasks inconsistent with those of CEO) faithfully, with the utmost
loyalty, to the best of his abilities and in the best interests of the Company;
(ii) shall devote his full business time, attention and effort to the
affairs of the Company, except that the Executive may continue to serve on
corporate boards (in addition to the Board) and/or (y) civic or charitable
boards or committees, in either case as long as such activities do not,
individually or in the aggregate, interfere with the performance of the
Executive’s employment duties and responsibilities or harm the business or
reputation of the Company or any of its Affiliates; and (iii) shall not
engage in any other business activities (whether or not for gain, profit, or
other pecuniary advantage) or any other actions which he knows or reasonably
should know could harm the business or reputation of the Company or any of its
affiliates or other related entities. The time involved in such activities
shall not be treated as vacation time. 
The Executive shall be entitled to keep any amounts paid to him in
connection with such activities (e.g., directors fees and honoraria).   For purposes of this Agreement, “Affiliates”
shall mean any entity that, directly or indirectly, is controlled by the
Company, and any entity in which the Company has a 20% or greater equity
interest.

 

(b)                                 The Executive
shall act in conformity with the Company’s written and oral policies and within
the limits, budgets and business plans set by the Company.  The Executive will at all times during the
Employment Period strictly adhere to and obey all of the rules and
regulations in effect from time to time relating to the conduct of Company
executives.  Except as provided in Section 2(a),
the Executive shall not engage in consulting work or any trade or business for
his own account or for or on behalf of any other person, firm or company that
competes, conflicts or interferes with the performance of his duties hereunder
in any material way.

 

(c)                                  The Executive
covenants, represents and warrants that: 
(i) the execution, delivery and complete performance of this
Agreement by him does not and will not breach, 

 

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violate or cause a default under any contract,
agreement, instrument, order, judgment or decree to which the Executive is a
party or by which he is bound; and (ii) he is not a party to or bound by
any employment or services agreement, confidentiality agreement, noncompetition
agreement, other restrictive covenant, or other obligation or agreement that
would or could prohibit or restrict him from being employed by the Company or
from performing any of his duties under this Agreement.

 

(d)                                 The Executive
shall not, at any time during or after his employment with the Company, make or
publish any derogatory, unfavorable, negative, disparaging, false, damaging or
deleterious written or oral statements or remarks regarding the Company or any
of its Affiliates or any members of their respective boards of directors or
managements, or any of their respective business affairs or performance.  The Company, members of its Board and its
senior executives shall not, at any time during or after the Executive’s
employment with the Company, make or publish any derogatory, unfavorable,
negative, disparaging, false, damaging or deleterious written or oral
statements or remarks regarding the Executive.

 

3.                                                  Compensation
and Benefits.

 

(a)                                  Base Salary.  During the Employment Period, subject to the
terms and conditions of this Agreement, the Company shall pay to the Executive
an annual base salary at the gross rate of $1,107,000 (the “Base Salary”),
payable in installments in accordance with the Company’s executive payroll
policy (but not less frequently than monthly).

 

(b)                                 Incentive
Compensation.  During the
Employment Period, the Executive shall be eligible to participate in the
Company’s annual incentive plan(s), including without limitation the Company’s
Management Incentive Plan (“MIP”), with an initial target level incentive bonus
percentage for the 2010 MIP equal to 125% of the Executive’s Base Salary and a
subsequent target level incentive bonus percentage for the 2010 MIP (that shall
become effective at such time as set forth in, and in accordance with, the
terms of the 2010 MIP) equal to 115% of the Executive’s Base Salary, provided
that the gross amount of any such annual incentive bonus payment to the
Executive under the 2010 MIP shall be reduced by $30,000 at the time that such bonus
is paid, and further provided that such reduction in such 2010 MIP bonus
payment shall not be considered, and shall be excluded, for purposes of
determining any other amounts to which the Executive is or may be entitled
under any other provision of this Agreement (including without limitation
Sections 4 and 8) or otherwise.

 

(c)                                  Special Annual
Incentive and Change-in-Control Payments.  Subject to the terms and conditions of this
Agreement (including without limitation Section 11) and provided that the
Executive complies with his obligations under this Agreement (including without
limitation those contained in Sections 2, 6, 9 and 10) and the Executive’s
employment has not terminated for Cause or without Good Reason (each as defined
in this Agreement):

 

(i)                                the Company
shall pay the Executive a special annual incentive payment (the “Special Annual
Incentive Payment”) in the amount of (A) $3,500,000 reduced by (B) that
portion of the Executive’s target level incentive bonus under the Company’s
2009 Long-Term Incentive Plan approved in the Chapter 11 Cases (the “2009 LTIP”)
that was (i) based only upon the Company’s financial performance (and not
any restructuring goals under the 2009 

 

3

 

LTIP) and (ii) earned in 2010 (the “2010 LTIP
Credit”).  The 2010 LTIP Credit is
calculated as those number of full calendar months between January 1, 2010
and the Effective Date divided by the twenty-four (24) months  in the 2009 LTIP plan cycle.  The Special Annual Incentive Payment is
payable in a lump sum on the earlier of (X) the sixtieth (60th) calendar day after the
Retirement Date or (Y) March 15, 2011, which amount of the Special
Annual Incentive Payment the Executive acknowledges and agrees is in lieu of
the Executive’s receipt of any grant of equity in the Company pursuant to the
Company’s Plan of Reorganization or the Equity Incentive Plan;

 

(ii)                             in the event (A) of
a Change in Control (as defined in this Agreement) during the Employment Period
or (B) that, at any time prior to the Retirement Date, the Company
receives an offer from a third party to purchase the Company or enter into any
other transaction(s) that would constitute a Business Combination (as
defined in this Agreement) that results in a Change in Control at any time
within fifteen months after the Effective Date (and provided that the Executive
participated in the efforts to sell the Company or to otherwise effectuate the
Business Combination), the Company shall pay to the Executive, within thirty
calendar (30) days after the Change in Control, an additional lump sum amount
equal to (X) the monetary value of equity that the individual holding the
positions of President and Chief Operating Officer (“COO”) of the Company as of
the Effective Date would receive if all of the equity-based compensation that
such President and COO received pursuant to and in accordance with the Company’s
Plan of Reorganization (i.e., that pursuant to the Plan of Reorganization, the
President and COO will receive 0.9% of the common shares of the Company issued
on the Effective Date on a fully diluted basis, allocated in a restricted stock
unit award with respect to 0.22% of such common shares and in an award granting
options to acquire 0.68% of such common shares) were fully vested and
liquidated at the Change in Control Value (as defined below) reduced by (Y) the
amount of the Special Annual Incentive Payment; and

 

(iii)                          for purposes of
Section 3(c)(ii):  (A) “Change
in Control Value” means the consideration paid or payable or the value received
or receivable with respect to a share of common stock of the Company in
connection with the Change in Control (as reasonably determined by the
Company), multiplied by the number of shares of common stock, common stock
units, or common stock equivalents held by the President and COO of the Company
as of the Effective Date; and (B) in the case of an option, stock
appreciation right or the equivalent, “Change in Control Value” means the
amount described in the preceding Section 3(c)(iii)(A), reduced by the
exercise price or strike price of the option, stock appreciation right or the
equivalent.

 

(d)                                 Employee
Benefits.  During the
Employment Period, the Executive shall be eligible to participate in such
employee benefit plans (including group medical and dental), and to receive
such other fringe benefits and perquisites (including but not limited to
reimbursement for annual income tax return preparation and tax counseling up to
$25,000 per year), as the Company may make available to senior executives
generally, subject to all present and future terms and conditions of such
benefit plans and other fringe benefits and perquisites.  If the Executive elects to pay the
entire premium for long-term disability coverage with after-tax dollars, the
Company will reimburse the Executive for the amount of such premium.  The Company reserves the right in its sole
discretion to alter, suspend, amend, or discontinue any and all of its employee
and fringe benefits, perquisites, benefit plans, policies and procedures, in
whole or in part, at any time with or without notice, provided that the Company
will not make 

 

4

 

any change to the Executive’s employee or fringe
benefits that it does not also make on a consistent basis for other senior
executives of the Company.

 

(e)                                  Executive Plans
and Programs.  During the
Employment Period, the Executive shall be entitled to participate on
substantially the same basis as the Company’s other senior executive officers
in any executive benefit plans offered by the Company, provided that the
Executive shall not be entitled to receive any emergence equity grant pursuant
to the Company’s Plan of Reorganization or Equity Incentive Plan.

 

(f)                                      Vacation.  The Executive shall be entitled to accrue
vacation in accordance with the Company’s vacation policy for senior executive
officers as in effect or amended from time to time, but in no event less than
five (5) weeks per calendar year.

 

(g)                                   Expense
Reimbursement.  The Company shall
reimburse the Executive for all reasonable and necessary business expenses
incurred by him in connection with his duties hereunder (including, without
limitation, Section 10) after the Executive’s timely presentation of
IRS-acceptable itemized and documented accounts of such expenditures, provided
that the Executive shall secure the Board’s approval before incurring any
extraordinary expenses, and provided further that such reimbursement for
reasonable and necessary business expenses is subject to the Company’s expense
reimbursement policy.

 

(h)                                 Withholdings
and Deductions.  Any and all
payments to the Executive under this Agreement shall be reduced by required or
authorized withholding and deductions.

 

(i)                                     Clawback.  In the event that the Board determines in
good faith that the amount of any incentive and/or performance based
compensation based in whole or in part on the financial performance of the
Company (or any division thereof) paid or granted to the Executive was
materially incorrect because the performance criteria were applied incorrectly,
within sixty (60) days after receiving written notice from the Board, the
Executive shall repay to the Company the portion of any cash payments or return
and forfeit the portion of any such grant, as the case may be, that the Executive
received that he was not entitled to receive due to such incorrect application
of the performance criteria (which such amount(s) to be repaid or returned
shall be reduced by the Net Tax Costs (as defined below)), provided that the
foregoing written notice from the Board is received by the Executive no later
than the earlier of (i) ninety (90) days after the date on which the
Company becomes aware of the incorrect application of the performance criteria
and (ii) the second anniversary of the payment, vesting or delivery, as
applicable, of the compensation.  “Net
Tax Costs” shall mean the net amount of any federal, state or local income and
employment taxes paid by the Executive in respect to the portion of the
compensation subject to repayment or return, after taking into account any and
all available deductions, credits or other offsets allowable to the Executive
(including without limit, any deductions permitted under the claim of right
doctrine), and regardless of whether the Executive would be required to amend
any prior income or other tax returns.

 

4.                                                  Payments
Upon Retirement.

 

Upon and subject to his
Retirement from his employment and separation from service with the Company as
set forth in Section 1 above (including due to any acceleration of 

 

5

 

the Retirement Date as set forth therein), subject
to the terms and conditions of this Agreement (including without limitation
Sections 6 and 11), provided that the Executive executes (without revoking) and
returns to the Company an enforceable waiver and release in a form acceptable
to the Company (a “Release Agreement”) within the time period specified by the
Company (which time period shall not be more than sixty (60) calendar days
after the effective date of the Executive’s termination of employment) and that
the applicable statutory revocation period with respect to such Release
Agreement has expired, and further provided that the Executive remains in
compliance with his obligations under this Agreement (including without
limitation those contained in Sections 9 and 10), the Company’s sole obligation
under this Agreement shall be to:

 

(a)                                  pay to the
Executive a new supplemental pension benefit that shall be determined and
payable in accordance with the applicable terms and conditions of, and formula(s) set
forth in, the SIPP II, as though the SIPP II had continued in effect after the
Effective Date (the “Supplemental Pension Benefit”), provided that,
notwithstanding anything to the contrary in the SIPP II, the Supplemental
Pension Benefit shall (i) be determined using the Executive’s total
service credit with the Company, its Affiliates and their respective
predecessors, which service credit shall include the Executive’s service with
any such predecessor(s) of the Company or any of its Affiliates from January 1,
1987 through and including the Retirement Date, (ii) be payable in such
manner and at such time(s) as it would have been paid under the SIPP II,
pursuant to the Executive’s election thereunder, had the SIPP II continued in
effect after the Effective Date, and (iii) include as necessary for
purposes of calculating the Executive’s final average earnings under the SIPP
II such compensation received by the Executive prior to the Effective Date
(including prior to the commencement of the Chapter 11 Cases) and thereafter,
further provided, however, that the Executive acknowledges and agrees that such
final average earnings calculation excludes any cash long-term incentive plan
payments made to the Executive after the filing of the Chapter 11 Cases and the
payments set forth in Section 3(c) of this Agreement;

 

(b)                                 provide the
Executive with reasonable office space and secretarial support at the Company’s
offices in the St. Louis, Missouri metropolitan area, at the Company’s expense,
through the period ending on December 31 of the second year following the
Retirement Date (except in the case of the Executive’s death), provided that
the Executive’s entitlement to the foregoing shall cease upon his full-time employment
by another employer;

 

(c)                                  pay the
Executive the Special Annual Incentive Payment and any payment due pursuant to
the terms and conditions of Section 3(c)(ii), in the amount(s) and at
the time(s) described in Section 3(c) to the extent not
theretofore paid;

 

(d)                                 in the event
the Retirement Date occurs on or prior to December 31, 2010, pay the
Executive (i) an amount equal to the difference between $1,107,000 and the
portion of the Base Salary that the Executive already has earned as of the
effective date of the termination, payable in a lump sum on the sixtieth (60th) calendar day after the
Retirement Date; and (ii) an additional amount equal to difference between
(A) the total actual annual incentive bonus(es) under the Company’s 2010
MIP that the Executive would have earned during the 2010 MIP plan year had he
remained employed and been entitled to receive such bonus(es) for the entire
2010 MIP plan year (including the reduction thereto as set forth in Section 3(b) of
this Agreement) and (B) the portions of any such annual incentive
bonus(es) already earned by the Executive during 

 

6

 

the 2010 MIP plan year, which amount of such
difference shall be paid at such time(s) as provided in such 2010 MIP for
participants who have not had a separation from service;

 

(e)                                  in the event that the
Retirement Date occurs during calendar year 2011, a pro-rated portion of the
annual incentive bonus(es) that the Executive would have earned for the
performance period(s) in 2011 as though he had remained employed and been
entitled to receive such bonus(es) for the applicable incentive plan
performance period(s), the amount of which pro-rated bonus payment(s) shall
be based upon the number of full calendar months in which the Executive was
employed during the applicable performance period(s), divided by the number of
full calendar months in the applicable performance period(s), which payment(s) shall
be paid at such time(s) as provided in such 2011 annual incentive plan as
though the Executive had remained employed through the entire applicable
performance period(s);

 

(f)                                    determine the Executive’s
age and service with the Company with respect to the amount of benefits under
the Company’s executive benefit plans based upon the Executive’s actual age and
service as of the Retirement Date;

 

(g)                                 pay to the Executive the
amounts set forth in Section 8(a) of this Agreement to the extent
that such amounts do not duplicate any amount(s) set forth in Section 4(a);
and

 

(h)                                 pay the employer portion of
the costs of continued health coverage at the Executive’s then-current level
under the Company’s health, dental, life, disability and other welfare benefit
plans (the Executive to pay the employee’s portion at regular employee rates)
for a period of three (3) years following the Retirement Date; provided
that if the Executive cannot participate in any benefit plan because he is not
actively performing services for the Company, the Company may provide such
benefits under an alternate arrangement, such as through the purchase of an
individual insurance policy that provides similar benefits.  The amount of such continued coverage shall
be determined, if applicable, by adding 36 additional months of age and service
to the Executive’s actual age and service as of the Executive’s Retirement Date
and as if the Executive earned compensation during such 36-month period at the
rate in effect during the twelve (12) month period immediately preceding his
Retirement Date.  The Executive’s
eligibility for any retiree medical or life coverage following such Retirement
Date shall also be determined by adding 36 additional months of age and service
to the Executive’s actual age and service as of the Retirement Date.  Notwithstanding the foregoing, the Executive
shall not be entitled to the benefits provided in this Section 4(h) to
the extent that he becomes eligible for coverage under another employer’s
benefit plans.

 

The
Executive acknowledges and agrees that under no circumstances will he receive,
or be entitled to receive, any of the benefits set forth in Section 8 of
this Agreement due to his Retirement as defined in Section 1 of this
Agreement, except as expressly set forth in Section 4(f) above.  In the event that the termination of the
Executive’s employment is due to Retirement as set forth in Section 1, the
Executive agrees to execute (without revoking) and return to the Company a
waiver and release in a form acceptable to the Company (a “Release Agreement”)
within the time period specified by the Company (which time period shall not be
more than sixty (60) calendar days after the effective date of the Executive’s
termination of employment) as a condition of receiving the payments and
benefits set forth in this Section 4, and provided that the 

 

7

 

applicable
statutory revocation period with respect to such Release Agreement has expired,
subject to the terms and conditions of this Agreement, such payments in this Section 4
shall be made at later of (A) such times of payment specified in the
applicable subsections of this Section 4 and (B) the sixtieth (60th) calendar day following the
Retirement Date.

 

5.                                                  Termination
of Employment Prior to the Retirement Date.

 

(a)                                  Termination by
the Company for Cause. 
Notwithstanding anything to the contrary herein, the Company may
terminate the Executive’s employment for Cause (as defined herein) at any time
immediately upon written notice.  For
purposes of this Agreement, “Cause” shall mean any of the following:  (i) the Executive’s willful and
continued failure to substantially perform his duties as an executive of the
Company (other than any such failure resulting from inability due to physical
or mental illness or Incapacity) after a written demand for substantial
performance is delivered to the Executive by the Board, which demand
specifically identifies the manner in which the Board believes that the
Executive has not substantially performed his duties, and which gives the
Executive at least thirty (30) days to cure such alleged deficiencies, (ii) the
Executive’s willful misconduct, which is demonstrably and materially injurious
to the Company, monetarily or otherwise, or (iii) the Executive’s engaging
in egregious misconduct involving serious moral turpitude to the extent that
his credibility and reputation no longer conforms to the standard of senior
executive officers of the Company.  The
Company and the Executive acknowledge and agree that an acceleration of the
Retirement Date by the Company pursuant to Section 1 of this Agreement
alone shall not be deemed a termination for Cause.

 

(b)                                 Voluntary
Resignation by the Executive With or Without Good Reason.  Notwithstanding anything to the contrary
herein, the Executive may terminate his employment with the Company for Good Reason
(as defined herein) at any time by written notice to the Company, in which case
his termination shall be a Retirement. 
At any time after the ninetieth (90th) calendar day after the Effective Date, the
Executive may terminate his employment with the Company upon sixty (60)
calendar days’ advance written notice without Good Reason (provided that this Section 5(b) shall
not apply to the Executive’s Retirement as set forth in Sections 1 and 4).  The Executive’s employment shall terminate
effective as of the effective date of any such notice or such later effective
termination date as the Executive may specify in the notice (which shall in no
event be later than sixty (60) calendar days after the notice is given unless
otherwise agreed to in writing by the Board). 
For purposes of this Agreement, “Good Reason” shall mean the occurrence
of any of the following without the Executive’s consent:  (i) assigning the Executive duties that
are materially inconsistent with those of a CEO for similar companies in similar
industries; (ii) requiring the Executive to report other than to the
Company’s Board; (iii) a material breach of this Agreement by the Company;
(iv) requiring the Executive to relocate his principal business office to
a location not within fifty (50) miles of either the Company’s principal
business office located in the St. Louis, Missouri metropolitan area or the
Chicago, Illinois metropolitan area (provided that the Company’s requiring
the Executive to relocate his principal office from the Chicago, Illinois
metropolitan area to the St. Louis, Missouri metropolitan area, or from the St.
Louis, Missouri metropolitan area to the Chicago, Illinois metropolitan
area, will not constitute Good Reason); and (v) the Agreement is not
assigned to a successor to the Company pursuant to the Plan of Reorganization;  provided, however, that an occurrence that otherwise may
constitute Good Reason hereunder shall not constitute Good Reason unless the
Executive (y) provides to the Company, at least thirty (30)  

 

8

 

calendar days prior to the Executive’s contemplated
resignation for Good Reason, a written notice containing reasonable detail
setting forth the basis for the Executive’s claim that an occurrence
constitutes Good Reason, and (z) the Company fails to cure or otherwise
remedy such occurrence within thirty (30) calendar days after receiving such
notice from the Executive.  The Executive
acknowledges and agrees that the restructuring events that have taken place or
will take place solely pursuant to the Company’s Plan of Reorganization shall
not constitute Good Reason for purposes of this Agreement.

 

(c)                                  Voluntary
Termination Following a Company Change in Control.  Notwithstanding anything to the contrary
herein, the Executive may terminate his employment with the Company following a
Company Change in Control (as defined herein), at any time during the
Employment Period, upon thirty (30) calendar days’ advance written notice to
the Company. Such a termination shall be a Retirement. Neither a Change in
Control with respect to any affiliate of the Company nor an assignment of this
Agreement to any reorganized entity of the Company pursuant to the Plan of
Reorganization shall constitute a Change in Control for the purposes of this
Agreement.  “Change in Control” shall
mean the occurrence of any one or more of the following:

 

(i)                                The “beneficial
ownership” of securities representing more than 20% of the combined voting
power of the then outstanding voting securities of the Company entitled to vote
generally in the election of directors (the “Company Voting Securities”) is
accumulated, held or acquired by a Person (as defined in Section 3(a)(9) of
the Securities Exchange Act of 1934, as amended, and used in Sections 13(d) and
14(d) thereof) other than the Company, any trustee or other fiduciary
holding securities under an employee benefit plan of the Company, or any
corporation owned, directly or indirectly, by the Company’s stockholders in
substantially the same proportions as their ownership of stock of the Company;
provided, however, that any acquisition from the Company or any acquisition
pursuant to a transaction that complies with clauses (A), (B) and (C) of
subparagraph (iii) of this definition will not be a Change in Control
under this subparagraph (i), and provided further that immediately prior to
such accumulation, holding or acquisition, such person was not a direct or
indirect beneficial owner of 20% or more of the Company Voting Securities;

 

(ii)                             Individuals
who, as of the Effective Date, constitute the Board (the “Incumbent Board”)
cease for any reason to constitute at least a majority of the Board; provided,
however, that an individual becoming a director subsequent to that date whose
election, or nomination for election by the Company’s stockholders, was
approved by a vote of at least a majority of the directors then comprising the
Incumbent Board will be considered as though such individual were a member of
the Incumbent Board, but excluding, for this purpose, any such individual whose
initial assumption of office occurs as a result of an actual or threatened
election contest with respect to the election or removal of directors or other
actual or threatened solicitation of proxies or consents by or on behalf of a Person
other than the Board;

 

(iii)                          Consummation by
the Company of a reorganization, merger or consolidation, or sale or other
disposition of all or substantially all the assets of the Company or the
acquisition of assets or stock of another entity (a “Business Combination”), in
each case, unless immediately following such Business Combination: (A) more
than 60% of the combined voting power of then outstanding voting securities
entitled to vote generally in the election of 

 

9

 

directors of (i) the
corporation resulting from such Business Combination (the “Surviving
Corporation”), or (ii) if
applicable, a corporation that as a result of such transaction owns the Company
or all or substantially all of the Company’s assets either directly or through
one or more subsidiaries (the “Parent Corporation”), is represented, directly
or indirectly, by Company Voting Securities outstanding immediately prior to
such Business Combination (or, if applicable, is represented by shares into
which such Company Voting Securities were converted pursuant to such Business
Combination), and such voting power among the holders thereof is in
substantially the same proportions as their ownership, immediately prior to
such Business Combination, of the Company Voting Securities; (B) no person
(excluding any employee benefit plan (or related trust) of the Company or such
corporation resulting from such Business Combination) beneficially owns,
directly or indirectly, 20% or more of the combined voting power of the then
outstanding voting securities eligible to elect directors of the Parent
Corporation (or, if there is no Parent Corporation, the Surviving Corporation)
except to the extent that such ownership of the Company existed prior to the Business
Combination; and (C) at least a majority of the members of the board of
directors of the Parent Corporation (or, if there is no Parent Corporation, the
Surviving Corporation) were members of the incumbent Board at the time of the
execution of the initial agreement, or of the action of the Board, providing
for such Business Combination;

 

(iv)                         Approval by the
Company’s stockholders of a complete liquidation or dissolution of the Company;
or

 

(v)                            The
consummation of a reorganization, complete liquidation, or dissolution under
the U.S. Bankruptcy Code subsequent to the Effective Date (and excluding the
Plan of Reorganization and the Chapter 11 Cases as defined herein).

 

6.                                                  The
Executive’s Duties After Notice of Retirement or Termination.  For any period in which the Executive gives
or is given notice prior to the effective date of the Executive’s termination
of employment (including due to any acceleration of the Retirement Date), the
Executive shall be expected and required to continue performing the Executive’s
duties and responsibilities in accordance with Section 2 of this Agreement
for the notice period up to the effective date of the termination of the
Executive’s employment.

 

7.                                                  Removal
from Positions.  Unless otherwise determined by the Board, any
termination of the Executive’s employment (including because of the Executive’s
Retirement) shall automatically effectuate the Executive’s removal from the
officer positions that the Executive then holds with the Company and its
Affiliates and any employee benefit plans, as of the effective termination
date.

 

8.                                                  Payments
Upon Termination of Employment Other Than Due to Retirement.

 

(a)                                  The parties
acknowledge and agree that except as expressly provided in Sections 4 and 8(b) of
this Agreement, in the event of the termination of the Executive’s employment,
the Company’s sole obligation under this Agreement shall be to pay the
Executive (i) any earned but unpaid Base Salary through the effective date
of the termination; (ii) any earned but unpaid bonus (if any) under the
Company’s annual incentive plan pursuant to, and in 

 

10

 

accordance with, the terms and conditions of such
plan; (iii) an amount equal to the Supplemental Pension Benefit, at the
time and in the amount set forth in Section 4(a) of this Agreement,
provided that such amount shall be calculated as though the Executive had
retired as of the effective termination date of his employment; (iv) any
earned but unused vacation time as determined in accordance with the Company’s
policies then in effect; and (v) any unreimbursed expenses pursuant to Section 3(g) of
this Agreement existing at that time.

 

(b)                                 In the event
that the Executive terminates his employment with the Company without Good
Reason in accordance with Section 5(b) of this Agreement, subject to
the terms and conditions of this Agreement, the Company’s sole obligation under
this Agreement shall be to pay to the Executive:  (i) such amounts due to him pursuant to Section 8(a) of
this Agreement; and (ii) a pro-rated portion of any annual incentive
bonus(es) that the Executive would have earned for the performance period(s) in
which the effective termination date of his employment occurred as though he
had remained employed and been entitled to receive such bonus(es) for the
applicable incentive plan performance period(s), the amount of which pro-rated
bonus payment(s) shall be based upon the number of full calendar months in
which the Executive was employed during the applicable performance period(s),
divided by the number of full calendar months in the applicable performance
period(s) and shall be paid at such time(s) as provided in such
annual incentive plan as though Executive had remained in employment.

 

(c)                                  The Executive
acknowledges and agrees that under no circumstance will he receive or be
entitled to receive payments pursuant to more than one of Sections 4 and 8 of
this Agreement and that there shall be no “double” payments pursuant to such
Sections in the event of the termination of the Executive’s employment as forth
therein; and further acknowledges and agrees that for purposes of Section 8
of this Agreement, “annual incentive bonus” shall mean the Executive’s
incentive bonus under the Company’s MIP then in effect or such other similar
annual incentive bonus plan or program then in effect.

 

(d)                                 Timing of
Payments.  Subject to
the terms and conditions of this Agreement (including without limitation Section 11),
the payments and benefits in Sections 8(a) and 8(b) will be paid or
commence (as applicable) at such times and in such manner as set forth in the
individual provisions of this Agreement referenced therein or the applicable
Company policy and plan documents.

 

(e)                                  Release.  Notwithstanding the foregoing, the Execute
agrees to execute (without revoking) a Release Agreement within the time period
specified by the Company (which time period shall not be more than sixty (60)
calendar days after the effective date of the Executive’s termination of
employment) as a condition of receiving the payments and benefits set forth in
Sections 8(a)(iii) and 8(b)(ii).

 

9.                                                  Confidentiality, Intellectual
Property and Restrictive Covenants.  The Company and the Executive agree that, in
each of his various senior management positions with the Company and otherwise
by virtue of his unique relationship with the Company (including pursuant to
this Agreement), the Executive has and will acquire and have access to, and has
and will continue to develop substantial and intimate knowledge of, the Company’s
Confidential Information (defined below), and has and will also continue to
develop a unique and comprehensive familiarity with the Company and the
Business Conducted by the Company or 

 

11

 

any of its Affiliates, which the Executive would not
have otherwise had but for his employment with the Company, and which the
Executive acknowledges are valuable assets of the Company.  Accordingly, the Executive agrees, in
exchange for the consideration and mutual covenants contained in this
Agreement, to undertake the following obligations, which he acknowledges are
reasonably designed to protect the legitimate business interests of the
Company, without unreasonably restricting his post-employment opportunities:

 

(a)                                  Confidential
Information.  The
Executive acknowledges that during his employment with the Company he has had
and will continue to have, and may continue to have during the Non-Compete
Period (as defined below), access to Confidential Information of the Company,
its Affiliates and, in certain situations, certain third parties who provide
information to the Company subject to confidentiality and non-use
restrictions.  All Confidential
Information is of irreplaceable value to the Company, its Affiliates and such
third parties.  Except as required to
perform the Executive’s responsibilities for the Company and its Affiliates, to
comply with law or regulation, or as authorized in writing in advance by the
Company, the Executive shall not, at any time, use, disclose, or take any action
which may result in the use or disclosure of any Confidential Information.  For purposes of this Agreement, “Confidential
Information” shall mean all confidential and proprietary information of the
Company, its Affiliates and, in certain situations, certain third parties who
provide information to the Company subject to confidentiality and non-use
restrictions, and includes, but is not limited to, actual and prospective
customer and client lists and pricing information, business plans, programs and
tactics, research and development information (including without limitation
information relating to the formulation, testing, registration, use, safety,
efficacy and/or effects of marketed products and compounds under development),
personnel information, and all other information unique to the Company and not
readily available to the public, including designs, improvements, inventions,
formulas, compilations, methods, strategies, capabilities, forecasts, software
programs, processes, know-how, data, operating methods and techniques, “Inventions
or Developments” (as defined below), and all business costs, profits, vendors,
markets, sales, products, marketing, sales or other financial or business
information, and any modifications or enhancements of any of the foregoing.

 

(b)                                   Inventions
or Developments.  The Executive
agrees that he will, now and in the future, promptly and fully disclose to the
Company all discoveries, improvements, inventions, formulas, ideas, processes,
designs, techniques, know-how, data and computer programs (whether or not
patentable, copyrightable or susceptible to any other form of protection), that
are or have been made, conceived, reduced to practice or developed by the
Executive, either alone or jointly with others, during his employment with the
Company, that are related in any way to the past, current or future business or
products of the Company or any of its Affiliates or are devised, made,
developed, reduced to practice or perfected utilizing equipment or facilities
of the Company or any of its Affiliates (collectively, the “Inventions or
Developments”).  All Inventions or
Developments shall be the sole property of the Company, including all patents,
copyrights, intellectual property or other rights related thereto and the
Executive assigns to the Company all rights (if any) that the Executive may
have or acquire in such Inventions or Developments.  Notwithstanding the foregoing, this Section 9(b) shall
not apply to any Inventions or Developments for which no equipment, supplies,
facility or trade secret information of the Company or its Affiliates were used
and which were developed entirely on the Executive’s own time, unless:  (i) the Inventions or Developments
relate to the Business

 

12

 

Conducted by the Company or any of its Affiliates or
the actual or demonstrably anticipated research or development of the Company
or any of its Affiliates; or (ii) the Inventions or Developments result
from any work performed by the Executive for the Company or any of its
Affiliates.

 

(c)                                    Restrictive
Covenants.  The Executive agrees that
during the Executive’s employment and for the two (2) year period
following the effective date of any termination of the Executive’s employment
for any reason (the “Non-Compete Period”), unless the Company gives its advance
written consent, the Executive shall not:

 

(i)                                 participate or
engage in, directly or indirectly (whether as an owner, agent, representative,
partner, employee, officer, director, independent contractor, consultant,
advisor, or in any other capacity calling for the rendition of services,
advice, or acts of management, operation or control), any business that, during
the Non-Compete Period, is competitive with the Business Conducted by the
Company or any of its Affiliates anywhere in the United States, Canada, Mexico,
or China (hereinafter, the “Geographic Area”) and which business the Company
was engaged (either actively as a going concern or in the process of developing
to market) during the two (2) year period preceding his termination of
employment;

 

(ii)                              directly or
indirectly solicit any current employee of the Company or any of its
Affiliates, or any individual who becomes an employee of the Company or any of
its Affiliates during the Non-Compete Period, to leave such employment and join
or become affiliated with any business that is, during the Non-Compete Period,
competitive with the Business Conducted by the Company or any of its Affiliates
within the Geographic Area; or

 

(iii)                          directly or
indirectly solicit, seek to divert or dissuade from continuing to do business
with or entering into business with the Company or any of its Affiliates, any
supplier, customer, or other person or entity with which the Company had, or
was actively planning or pursuing, a business relationship at any time during
the two (2) year period preceding his termination of employment.

 

For purposes of this Agreement, during the Executive’s
employment, “Business Conducted by the Company or any of its Affiliates” shall
mean (a) all businesses conducted by the Company or any of its Affiliates
and (b) any material new line of business in which the Company or any of
its Affiliates is contemplating engaging in, provided that the plans for the
Company or any of its Affiliates to engage in such material new line of
business were presented to and not rejected by the Board.  For purposes of this Agreement, for two-year
period following the effective date of any termination of the Executive’s
employment, “Business Conducted by the Company or any of its Affiliates” shall
mean (a) all business conducted by the Company or any of its Affiliates as
of the effective date of the Executive’s termination of employment and (b) any
material new line of business in which the Company or any of its Affiliates
engages within the one-year period following the effective date of the
Executive’s termination of employment, provided that the plans for the Company
or any of its Affiliates to engage in such material new line of business were
presented to and not rejected by the Board prior to the effective date of the
Executive’s termination of employment and while the Executive was a member of
the Board.

 

13

 

(d)                                 No Diversion of
Business Opportunities and Prospects.  The Executive agrees that during his
employment with the Company:  (i) the
Executive shall not directly or indirectly engage in any employment, consulting
or other business activity that is competitive with the Business Conducted by
the Company or any of its Affiliates; (ii) the Executive shall promptly
disclose to the Company all business opportunities that are presented to the
Executive in his capacity as an employee of the Company; and (iii) the
Executive shall not usurp or take advantage of any such business opportunity
without first offering such opportunity to the Company.

 

(e)                                  Return of
Property.  The
Executive acknowledges and agrees that immediately upon his termination of
employment with the Company (including due to his Retirement) he will promptly
return (without retaining any copies) all property of the Company, its
Affiliates or any third parties that is within his possession, custody or
control by virtue of his employment with the Company.  Property to be returned to the Company shall
include without limitation any and all documents and other things (whether in
tangible or electronic format and whether such documents or things contain
information that reflect or contain any Confidential Information or proprietary
information) in the Executive’s possession, custody or control, further
including without limitation all computer programs, passwords, files, and
diskettes, all written and printed files, manuals, contracts, memoranda, forms,
notes, records and charts (and any and all copies of, or extracts from, any of
the foregoing), vehicles, keys, cell phones, credit cards and other equipment
and materials furnished to him by the Company; provided, however, that (i) the
Executive shall be entitled to keep his home office equipment; and (ii) the
Company and the Executive shall work together to ensure that any Confidential
Information, Inventions or Developments, or other Company business
information is removed from such home office equipment.

 

(f)                                      Irreparable
Harm.  The Executive acknowledges that:  (i) the covenants contained in Sections
2(d) and 9 are reasonable in scope and duration, will not unduly restrict
the Executive’s ability to engage in his livelihood, and the Executive’s
compliance with Sections 2(d) and 9 is necessary to preserve and protect
the Confidential Information, Inventions or Developments, and other
legitimate business interests of the Company; (ii) any failure by the
Executive to comply with the provisions of Sections 2(d) and 9 will result
in irreparable and continuing injury to the Company for which there will be no
adequate remedy at law; and (iii) in the event that the Executive should
fail to comply with the terms and conditions of Sections 2(d) and 9, in
addition to the Company’s right to set off any actual monetary damages to the
Company that are a consequence of such failure to comply against any payments
and benefits due to the Executive pursuant to Sections 4 or 8 (but excluding
Sections 4(a) and 8(a)(iii)) (provided that any such set offs first shall
be taken from amounts not subject to Section 409A of the Code (as defined
in Section 11 below), and if such amounts are insufficient, any
additional set off shall not be taken until the time an amount subject to Section 409A
of the Code would otherwise be paid pursuant to the terms of this Agreement),
the Company shall be entitled, in addition to and without limiting such other
relief as may be proper, to all types of equitable relief (including but not
limited to the issuance of an injunction and/or temporary restraining order) as
may be necessary to cause the Executive to comply with Sections 2(d) and
9, to restore to the Company its property, and to make the Company whole.  The Company and Executive acknowledge and
agree that the Company or the Executive’s failure to enforce or insist on its
or his rights under Sections 2(d) and 9 shall not constitute a waiver or
abandonment of any such 

 

14

 

rights or defense to enforcement of such
rights.  If the provisions of Sections 2(d) and
9 are ever deemed by a court to exceed the limitations permitted by applicable
law, the Executive and the Company agree that such provisions shall be, and
are, automatically reformed to the maximum lesser limitations permitted by such
law.

 

10.                                           Cooperation.  At the request and upon
reasonable advance notice where practicable and at the sole expense of the
Company, whether during or at any time after the Executive’s employment with
the Company or any of its Affiliates, the Executive shall cooperate fully with
the Company and its Affiliates (a) in investigating, defending,
prosecuting, litigating, filing, initiating or asserting any claims or
potential claims (including without limitation in connection with any legal
proceeding of any kind) that may be made by or against the Company or any of
its Affiliates, to the extent that such claims may relate to or arise out of
the Executive’s employment with the Company or any of its Affiliates or with
respect to which the Executive has knowledge and (b) without in any way
limiting subsection (a) above, to secure any trade name, patent,
trademark, copyright or intellectual property protection or other similar
rights in the United States and/or in foreign countries, including without
limitation, the execution and delivery of assignments, patent applications and
other documents or papers.  If such
cooperation is provided during the Executive’s employment with the Company or
any of its Affiliates, the Executive shall not receive any additional
compensation from the Company for such cooperation.  If the Executive no longer is employed by the
Company or any of its Affiliates, the Executive’s obligation to cooperate shall
be reasonably limited so as not to unreasonably interfere with his other
business obligations.  If the Executive
spends in excess of ten (10) hours in compliance with this Section 10
after he is no longer employed by the Company or any of its Affiliates, the
Company shall compensate the Executive at an hourly rate equal to the amount
determined by dividing (x) the Executive’s Base Salary as of the first day
of the fiscal year of the Company within which the Executive’s employment is
terminated by (y) 2000, and shall reimburse the Executive for any
reasonable expenses incurred as a direct result of his providing such
cooperation in accordance with Section 3(g) of this Agreement.  The Company shall provide such compensation
for the Executive’s cooperation within thirty (30) calendar days after
receiving from the Executive a written statement stating the number of hours
for which he seeks payment and brief description of the cooperation provided,
provided that the Executive submits such statement within thirty (30) calendar
days after the end of the calendar month in which the Executive provided such
cooperation.  The Executive’s obligation
to cooperate hereunder shall include, without limitation, meeting with such
persons at such times and in such places as the Company or its Affiliates may
require, and giving evidence and testimony and executing and delivering to the
Company and any of its Affiliates any papers requested by any of them
(including without limitation joint defense agreements and affidavits).  The Executive shall provide immediate notice
to the Company of any subpoena or other legal document that he receives that
relates in any way to the Company or any of its Affiliates, along with a copy
of such subpoena or other legal document.

 

11.                                           Compliance
with Section 409A.  All references in this Agreement to the
Executive’s termination of employment shall mean his separation from service
within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and
Treasury regulations promulgated thereunder.  To the extent this Agreement provides for
compensation that is deferred compensation subject to Section 409A of the
Code, it is intended that the Executive not be subject to the imposition of taxes and penalties (“409A
Penalties”) 

 

15

 

under Section 409A of the Code,
and shall be construed in accordance with that intent.  In the event the terms of this Agreement
would subject the Executive to 409A Penalties, the Company and the Executive
shall cooperate diligently to amend the terms of the Agreement to avoid such
409A Penalties, to the extent possible. 
Notwithstanding any other provision in this Agreement, if as of the date
on which the Executive’s employment terminates, the Executive is a “specified
employee” as determined by the Company, then to the extent any amount payable
or benefit provided under this Agreement that the Company reasonably determines would be nonqualified
deferred compensation within the meaning of Section 409A of the Code, for
which payment is triggered by Executive’s separation from service (other than
on account of death), and that under the terms of this Agreement would be
payable prior to the six-month anniversary of the Executive’s effective date of
termination, such payment or benefit shall be delayed until the earlier to
occur of (a) the six-month anniversary of such termination date or (b) the
date of the Executive’s death.  In the
case of taxable benefits that constitute deferred compensation, the Company, in
lieu of a delay in payment, may require the Executive to pay the full costs of
such benefits during the period described in the preceding sentence and
reimburse that Executive for said costs within thirty (30) calendar days after
the end of such period.  With respect to
any reimbursements under this Agreement, such reimbursement shall be made on or
before the last day of the Executive’s taxable year following the taxable year
in which the expense was incurred by the Executive.  The amount of any expenses eligible for
reimbursement or the amount of any in-kind benefits provided, as the case may
be, under this Agreement during any calendar year (including without limitation
pursuant to Sections 10 and 23) shall not affect the amount of expenses
eligible for reimbursement or the amount of any in-kind benefits provided
during any other calendar year. The right to reimbursement or to any in-kind
benefit pursuant to this Agreement shall not be subject to liquidation or
exchange for any other benefit.  The
Executive acknowledges and agrees that notwithstanding this Section 11 or
any other provision of this Agreement, the Company and its Affiliates are not
providing him with any tax advice with respect to Section 409A of the Code
or otherwise and are not making any guarantees or other assurances of any kind
to the Executive with respect to the tax consequences or treatment of any
amounts paid or payable to the Executive under this Agreement.

 

12.                                           Section 280G
Gross-up.  To the extent
permitted by applicable law:

 

(a)                                  in the event it
is determined that any payment or distribution by the Company to or for the
benefit of the Executive after the date hereof pursuant to the terms of this
Agreement or otherwise (including without limitation any deferred compensation
plans), determined without regard to any additional payments required under
this Section 12(a) (a “Payment”), would be subject to the excise tax
imposed by Section 4999 of the Code or any interest or penalties with
respect thereto are incurred by the Executive with respect to any such tax (any
such tax, together with any such interest or penalties, are hereinafter
collectively referred to as the “Additional Tax”), then, subject to the
Executive’s compliance with Section 12(c), the Executive shall be entitled
to receive from the Company an additional payment (a “Gross-Up Payment”) in an
amount such that after payment by the Executive of all taxes (including any
interest or penalties imposed with respect to such taxes), including, without
limitation, any income taxes (and any interest and penalties imposed with
respect thereto) and Additional Tax imposed upon the Gross-Up Payment, the
Executive retains an amount of the Gross-Up Payment equal to the Additional Tax
imposed upon the Payments; provided, however, that notwithstanding the
foregoing provisions of this Section 12(a), if it shall be determined that

 

16

 

the Executive is entitled to a Gross-Up Payment, but
that the amount of the aggregate Payments is less than 110% of the product of (A) three
(3) times (B) the Executive’s Base Amount (as such term is defined in
Section 280G of the Code), then no Gross-Up Payment shall be made to the
Executive and the cash Payments provided in Section 8 of this Agreement
shall first be reduced, and the non-cash Payments and benefits shall thereafter
be reduced, until no amount of the Payments shall be subject to the exercise
tax under Section 4999 of the Code;

 

(b)                                 the parties are
entering into this Agreement with the reasonable mutual understanding that the
Payments are not subject to Additional Taxes, and the parties shall, subject to
this Section 12(b), report such amounts in their federal tax returns for
the appropriate periods in a manner consistent with such understanding.  Subject to the provisions of Section 12(c),
all other determinations required to be made under this Section 12(b),
including whether and when a Gross-Up Payment is required and the amount of
such Gross-Up Payment and the assumptions to be utilized in arriving at such
determination, shall be made by the Company’s public accounting firm (the “Accounting
Firm”).  All fees and expenses of the
Accounting Firm shall be borne solely by the Company.  Any Gross-Up Payment, as determined pursuant
to this Section 12(b), shall be paid by the Company to the Executive
within the earlier of five (5) business days after the Company’s receipt
of the Accounting Firm’s determination and the end of the Executive’s taxable
year next following the taxable year in which the Executive pays the Additional
Taxes to which such Gross-Up Payment relates to the applicable taxing authority.  Any determination by the Accounting Firm
shall be binding upon the Company and the Executive;

 

(c)                                  the Executive
shall notify the Company in writing of any claim by the Internal Revenue
Service that, if successful, would require the payment by the Company of a
Gross-Up Payment.  Such notification
shall be given as soon as practicable but no later than ten (10) business
days after the Executive is informed in writing of such claim and shall apprise
the Company of the nature of such claim and the date on which such claim is
requested to be paid.  The Executive
shall not pay such claim prior to the expiration of the 30-calendar-day period
following the date on which the Executive gives such notice to the Company (or
such shorter period ending on the date that any payment of taxes with respect
to such claim is due).  If the Company
notifies the Executive in writing prior to the expiration of such period that
it desires to contest such claim, the Executive shall: (i) give the
Company any information reasonably requested by the Company relating to such
claim; (ii) take such action in connection with contesting such claim as
the Company shall reasonably request in writing from time to time, including,
without limitation, accepting legal representation with respect to such claim
by an attorney reasonably selected by the Company; (iii) cooperate with
the Company in good faith in order effectively to contest such claim, and (iv) permit
the Company to participate in any proceedings relating to such claim; provided,
however, that the Company shall bear and pay directly all costs and expenses
(including additional interest and penalties) incurred in connection with such
contest and shall indemnify and hold the Executive harmless, on an after-tax
basis, for any Additional Tax or income tax (including interest and penalties
with respect thereto) imposed as a result of such representation and payment of
costs and expenses.  Any amount the
Company is obligated to pay or indemnify under this Section 12(c) shall
be paid or indemnified on or before the last day of the calendar year following
the calendar year in which the expense, cost or Additional Tax was
incurred.  Without limitation on the
foregoing provisions of this Section 12(c), the Company shall control all
proceedings taken in connection with such contest and, at its 

 

17

 

sole option, may pursue or forgo any and all
administrative appeals, proceedings, hearings and conferences with the taxing
authority in respect of such claim and may, at its sole option, either direct
the Executive to pay the tax claimed and sue for a refund or contest the claim
in any permissible manner, and the Executive agrees to prosecute such contest
to a determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall
determine; provided further, that if the Company directs the Executive to pay
such claim and sue for a refund, the Company shall advance the amount of such payment
to the Executive on an interest-free basis and shall indemnify and hold the
Executive harmless, on an after-tax basis, from any Additional Tax or income
tax (including interest or penalties with respect thereto) imposed with respect
to such advance or with respect to any imputed income with respect to such
advance.  The Company’s control of the
contest shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder, and the Executive shall be entitled to settle or
contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority; and

 

(d)                                 as a result of
the uncertainty in the application of Code Section 4999 at the time of the
initial determination by the Accounting Firm hereunder, it is possible that the
Internal Revenue Service (“IRS”) or other agency will claim that a greater or
lesser Additional Tax is due.  In the
event that the Additional Tax is finally determined to be less than the amount
taken into account hereunder in calculating the Gross-Up Payment, the Executive
shall repay to the Company, at the time that the amount of such reduction in
Additional Tax is finally determined, the portion of the Gross-Up Payment
attributable to such reduction (plus that portion of the Gross-Up Payment
attributable to the Additional Tax and taxes imposed on the Gross-Up Payment
being repaid by the Executive) plus interest on the amount of such repayment at
120% of the rate provided in Code Section 1274(b)(2)(B).  In the event that the Excise Tax is
determined to exceed the amount taken into account hereunder in calculating the
Gross-Up Payment (including by reason of any payment the existence or amount of
which cannot be determined at the time of the Gross-Up Payment), the Company
shall make an additional Gross-Up Payment in respect of such excess (plus any
interest, penalties or additions payable by the Executive with respect to such
excess) at the time that the amount of such excess is finally determined.  The Executive and the Company shall each
reasonably cooperate with the other in connection with any administrative or
judicial proceedings concerning the existence or amount of liability for
Additional Tax with respect to the total Payments.  The Company shall pay all fees and expenses
of the Executive relating to a claim by the IRS or other agency.

 

13.                                           Notices.  Notices given pursuant to this Agreement
shall be in writing and shall be effective upon personal delivery, upon
confirmation of receipt of facsimile transmission, upon the fourth day after
mailing by certified mail, or upon the second day after sending by express
courier service.  Notice to the Company
shall be directed to:

 

Smurfit-Stone
Container Corporation

Six
CityPlace Drive

Creve
Coeur, Missouri 63141

Attention:  General Counsel

 

Notices
to or with respect to the Executive will be directed to the Executive, or to
the Executive’s executors, personal representatives or distributees, if the
Executive is deceased, or 

 

18

 

the
assignees of the Executive, at the Executive’s home address on the records of
the Company.  Either party may change the
person and/or address to which the other party must give notice under this Section by
providing written notice of such change, in accordance with the procedures
described in this Section 13.

 

14.                                           Assignment.  This Agreement is enforceable by the Company
and its affiliates and other related entities and shall be assigned or
transferred by the Company to, and shall be binding upon and inure to the
benefit of, any parent, subsidiary or other Affiliate of the Company or any
entity which at any time, whether by merger, purchase, or otherwise, acquires
all or substantially all of the assets, stock or business of the Company
(including without limitation any successor and/or reorganized entit(ies) of
the Company or any of its Affiliates upon the Effective Date).  The Executive and the Company agree that upon
the Effective Date, this Agreement shall be assigned to and binding upon such
successor entit(ies) of the Company as set forth in the Plan of Reorganization,
provided that nothing herein shall limit or otherwise affect the Company’s
right to further assign or transfer this Agreement after the Effective Date as
set forth in the preceding sentence.  The
Executive may not assign any of his rights or obligations under this Agreement
during his life.  Upon the Executive’s
death, this Agreement will inure to the benefit of the Executive’s heirs,
legatees and legal representatives of the Executive’s estate.

 

15.                                           Beneficiary.  If the Executive dies prior
to receiving the amounts to which he is entitled under this Agreement (if any),
subject to and in accordance with the terms and conditions of this Agreement,
such amounts shall be paid to the beneficiary designated by the Executive in
writing to the Company during his lifetime (“Beneficiary”), or if no such
Beneficiary is designated, to the Executive’s estate.  Notwithstanding anything to the contrary
herein, the Beneficiary shall not be entitled to receive any amounts pursuant
to this Agreement that are conditioned upon a Release Agreement unless the
Beneficiary and any other authorized representatives of the Executive’s estate
execute a waiver and release of claims in accordance with the Executive’s obligations
set forth in Section 4.  The
Executive, without the consent of any prior Beneficiary, may change his
designation of Beneficiary or Beneficiaries at any time and from time to time
by submitting to the Company a new designation in writing.

 

16.                                           Severability.  Each provision of this Agreement will be
interpreted in such manner as to be effective and valid under applicable
law.  The Executive and the Company agree
that in the event that any provision of this Agreement is found to be
unreasonable or otherwise unenforceable by a court, it is the purpose and
intent of the parties that any such provision be deemed modified or limited, so
that as modified or limited, such provision may be enforced to the fullest
extent possible.  If any provision of
this Agreement is held invalid or unenforceable for any reason (after any such
modification or limitation pursuant to the preceding sentence, as applicable),
such provision will be effective only to the extent of such invalidity or
unenforceability without invalidating the remainder of such provision or the
remaining provisions of this Agreement.

 

17.                                           Entire
Agreement, Amendment and Waiver.  Except as otherwise provided herein, this
Agreement embodies the entire agreement and understanding of the parties hereto
with regard to the matters described herein and supersedes any and all prior
and/or contemporaneous agreements and understandings, oral or written, between
said parties regarding such matters.  The
Executive and the Company acknowledge and agree that this Agreement 

 

19

 

amends and restates the Predecessor Agreement in its
entirety and that as of the Effective Date the provisions of this Agreement
shall replace each and every provision of the Predecessor Agreement, at which
time the provisions of the Predecessor Agreement shall be null and void, and
shall be of no further force or effect. 
Except as set forth in Sections 9(f) and 16, this Agreement may be
modified only in a written agreement signed by both the Executive and the
Company’s authorized representative.  Any
party’s failure to enforce this Agreement in the event of one or more events
which violate this Agreement shall not constitute a waiver of any right to
enforce this Agreement against subsequent violations.

 

18.                                           Forum
Selection.  The parties
hereby irrevocably consent to, and agree not to object or assert any defense or
challenge to, the jurisdiction and venue of the state and federal courts
sitting in Chicago, Illinois, and agree that any claim under this
Agreement may be brought in any such court. 
In any action or proceeding to enforce this Agreement, the
non-prevailing party shall pay for any and all costs and expenses (including
without limitation reasonable attorneys’ fees) of the prevailing party to the
maximum extent permissible by applicable law.

 

19.                                           Governing
Law.  This
Agreement shall be governed by the internal laws of the state of Illinois,
without regard to its conflict of laws rules.

 

20.                                           Headings.  The Section headings used herein are for
convenience of reference only and are not to be considered in construction of
the provisions of this Agreement.

 

21.                                           Release
of SIPP II and Predecessor Claims. 
The consideration offered herein is accepted by the Executive as being
in full accord, satisfaction, compromise and settlement of any and all claims
that the Executive may have against the Company that existed on or prior to the
Effective Date arising out of or concerning amounts that are or may have been
due and owing to him pursuant to the SIPP II or the Predecessor Agreement, and
the Executive expressly agrees that he is not entitled to and will not receive
any payments, benefits, or other compensation or recovery of any kind from the
Company with respect to the SIPP II or the Predecessor Agreement.

 

22.                                           Survival.  Sections 2(d) and 4 through 24 herein
shall survive and continue in full force and effect in accordance with their
respective terms, notwithstanding any termination of the Employment Period or
the Executive’s employment.

 

23.                                           Attorneys’
Fees for Negotiating This Agreement.  The Company shall pay within thirty (30)
calendar days after receipt of the Invoices (as described below) the reasonable
fees and expenses of the Executive’s outside legal counsel, accountants, and
other advisors in connection with the negotiation and execution of this
Agreement and the terms and conditions of his employment in an amount not to
exceed $100,000, provided that the Company receives from the Executive or his
advisors invoices for services provided to the Executive in connection with the
negotiation and execution of this Agreement (“Invoices”) within sixty (60) days
after the Effective Date.

 

24.                                           Counterparts.  This Agreement may be executed in two
counterparts, each of which shall be deemed an original, and both of which
together shall constitute one and the same instrument.

 

20

 

THE
PARTIES ACKNOWLEDGE BY SIGNING BELOW THAT THEY HAVE READ AND UNDERSTAND THE
ABOVE AND INTEND TO BE BOUND THEREBY:

 

	
  PATRICK
  J. MOORE

  	
   

  	
  SMURFIT-STONE
  CONTAINER CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Patrick J. Moore

  	
   

  	
  By:

  	
  /s/
  Ralph F. Hake

  
	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
  June 30, 2010

  	
   

  	
  Position:

  	
  Chairman

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
  June 30,
  2010

  
					

 

21

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00175-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00175-of-00352.parquet"}]]