Document:

exv10w82

 

EXHIBIT 10.82

EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT (the “Agreement”) is entered into as of the 2nd
day of July, 2003, by and between Gene Logic Inc., a Delaware corporation (the
“Company”), and Robert Proulx (the “Executive”).

     The Company desires to secure the services of Employee and Employee
desires to perform such services for the Company on the terms and conditions as
set forth in this Agreement.

NOW, THEREFORE, in consideration of the mutual promises made below, the parties
agree as follows:

     1.     Employment, Duties and Acceptance.

             1.1     Employment. (a) Effective upon the later of the date of this
agreement or the date the Executive first reports for work for the Company (the
“Effective Date”), the Company shall employ the Executive as Senior Vice
President, Marketing, initially reporting to Mark Gessler. In such capacity,
the Executive shall perform such executive and management duties and assume
such other responsibilities as may be assigned from time to time by the
individual to whom the Executive reports, the Chief Executive Officer (“CEO”)
of the Company or anyone else designated by the CEO. The Executive accepts
such employment and shall perform his duties faithfully and to the best of his
abilities.

             (b)     The Executive shall devote his full working time and creative energies
to the performance of his duties hereunder and will at all times devote such
additional time and efforts as are reasonably sufficient for fulfilling the
significant responsibilities entrusted to him. So long as such activities, in
the aggregate, do not interfere with the performance by the Executive of his
duties hereunder: (i) the Executive shall be permitted a reasonable amount of
time to supervise his personal, passive investments; and (ii) the Executive
shall be permitted a reasonable amount of time to participate (as board member,
officer or volunteer) in civic, political and charitable activities.

             1.2     Place of Employment. The Executive’s principal place of
employment shall be at the Company’s headquarters or other Company facility in
the Baltimore-Washington, D.C. metropolitan area (including Montgomery, Howard
and Frederick Counties in Maryland) specified by the individual to whom the
Executive reports, or as otherwise mutually agreed by the parties, subject to
such travel as may be reasonably required by his employment pursuant to the
terms hereof. The Executive shall not be required to relocate outside of the
Baltimore-Washington, D.C. metropolitan area during the Term unless the
Executive so agrees and Company provides relocation benefits reasonably
acceptable to the Executive.

     2.     Term of Employment. The Executive’s term of employment with the
Company (the “Term”) shall commence on the Effective Date and continue
thereafter on an at-will basis until terminated by either party pursuant to
Section 4, subject to certain rights upon termination as provided in Section 4.
If Executive’s employment hereunder with the Company is terminated by the
Executive or by the Company, Executive shall thereby be removed from, and
Executive agrees to resign immediately from, all other positions with the
Company and its affiliates and subsidiaries (collectively the “GLGC Group”).

     3.     Compensation.

             3.1     Salary. As compensation for all services to be rendered
pursuant to this Agreement, the Company shall pay to the Executive during the
Term a salary at the rate of $200,000 per annum (the “Base Salary”) less such
deductions as shall be required to be withheld by applicable tax and other laws
and regulations or as otherwise authorized by the Executive. The Base Salary
shall accrue from and after the Effective Date, and shall be payable during the
Term, in arrears in equal periodic installments, not less frequently than
semi-monthly. The Executive’s Base Salary shall be reviewed annually and may be
increased based upon various factors, including the evaluation of the
Executive’s performance and the compensation policies of the Company in effect
at the time of each such review. The Base Salary shall be

 

prorated for the first calendar year of employment and for any other year in
which Executive is not employed by the Company for the entire year based on the
portion of the year in which Executive is employed on a full-time basis by the Company.

             3.2     Bonus. Executive will be eligible to participate in any bonus
plan established by the Compensation Committee of the Board (the “Compensation
Committee”) and generally applicable to officers of the Company, for periods
beginning on or after July 1, 2003. Payment of a bonus under any such plan will
be contingent on achieving such targets and levels of performance as may be
specified by the Compensation Committee. Such targets and levels of performance
may be specified for individuals or groups of individuals, by department and/or
on a company-wide basis. Bonus payments for any applicable plan will be made
on at least an annual basis, subject to prior approval by the Compensation
Committee. The target bonus for Executive for the Company’s fiscal year 2003,
which shall be based on achieving 100% of the targets and levels of performance
established by the Compensation Committee, will be $60,000 for a full calendar
year, less applicable withholding, prorated based on the portion of the year in
which Executive is employed by the Company. To receive a bonus for any period,
except as specifically provided in section 4.7, the Executive must be employed
by the Company on a full-time basis as of the last business day of the period
for which the bonus is paid.

             3.3     Stock Options. Upon and subject to approval by the Board of
Directors of the Company or its Compensation Committee, Executive will receive
a stock option grant under the Company’s 1997 Equity Incentive Plan (the
“Plan”) to acquire 50,000 shares of Company Common Stock at an exercise price
equal to the fair market value per share at date of grant, which will be
Executive’s first day of employment hereunder (which for administrative
purposes is the closing price on the last business day preceding the date of
grant). The stock options will vest and become exercisable at the rate of
one-forty eighth per month at the end of each month of employment. The options
will have a 10-year term and be subject to the other terms and conditions of
the Plan and the standard form of stock option grant agreement thereunder. The
stock option will be an incentive stock option under Section 422 of the
Internal Revenue Code of 1986, as amended, (“Code”) to the maximum extent
permitted by the law and the Plan; any remaining portion of the stock option
will be treated as a Non-Statutory Stock Option.

             3.4     Participation in Benefit Plans. The Executive shall be
permitted during the Term, to the extent eligible, to participate in any group
life, medical, dental, vision, or disability insurance plans, accidental death
and dismemberment plan, 401(k) plan, or similar benefit plans of the Company
which may be available generally to other senior executives of the Company, but
nothing herein shall prevent the Company from changing such benefits from time
to time.

             3.5     Paid Time Off. The Executive shall accrue and may use paid
time off (“PTO”) in accordance with the Company’s policies. PTO accruing in
the first calendar year of employment and in any other year in which Executive
is not employed by the Company for the entire year shall be prorated based on
the portion of the year in which Executive is employed by the Company.

             3.6     Holidays. The Executive shall be eligible for holidays in
accordance with the Company’s policy and schedule.

             3.7     Expenses. In accordance with the Company’s policies, the
Executive will be reimbursed for all ordinary, necessary and reasonable
business expenses (including, without limitation, travel, meetings, dues,
subscriptions, fees, educational expenses, and expenses incurred for operation
of mobile telephones,) actually incurred or paid by the Executive during the
Term in the proper performance of the Executive’s services under this
Agreement, upon presentation of expense statements or vouchers or such other
supporting information as the Board may reasonably require.

             3.8     Tax/Financial Planning. The Executive shall be reimbursed in
an amount not in excess of $5,000 in the aggregate per year for tax return
preparation and certain financial planning advice in accordance with the
Company’s policies.

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             3.9.     Change of Control. If so designated by the Board, the
Executive shall be included in the Company’s Executive Severance Plan (the
“Change-of-Control Severance Plan”), which may provide certain benefits if the
Executive’s employment is terminated as a result of a change in control of the Company.

             3.10    Withholding. The Company is authorized to withhold from the
amount of any Base Salary and bonuses and any other payments or benefits paid
or provided to or for the benefit of the Executive, all sums authorized by the
Executive or required to be withheld by law, court decree, or executive order,
including (but not limited to) such things as income taxes, employment taxes,
and employee contributions to fringe benefit plans sponsored by the Company.

     4.     Termination.

             4.1     General. The employment of the Executive hereunder may be
terminated as provided in this Section 4.

             4.2     Termination Upon Mutual Agreement. The Company and the
Executive may, by mutual written agreement, terminate this Agreement and/or the
employment of the Executive at any time.

             4.3     Death or Disability of Executive.

             (a)     The employment of the Executive hereunder shall terminate upon (i) the
death of the Executive, and (ii) at the option of the Company upon not less
than thirty (30) days prior written notice to the Executive or his personal
representative or guardian, if the Executive suffers a Total Disability (as
defined in Section 4.3(b) below).

             (b)     For purposes of this Agreement, “Total Disability” shall mean (i) if
the Executive is subject to a legal decree of incompetency (the date of such
decree being deemed the date on which such disability occurred), or (ii) the
written determination by a physician selected by the Company that, because of a
medically determinable disease, injury or other physical or mental disability,
the Executive is substantially unable to perform his essential duties, without
reasonable accommodation, and that such disability has lasted for the
immediately preceding ninety (90) days and is, as of the date of determination,
reasonably expected to last an additional ninety (90) days or longer after the
date of determination. If requested by the Company, Executive agrees to appear
at a medical examination by a physician selected by the Company and to furnish
to such physician such medical information as is needed for a determination
under this Section 4.3(b). Nothing in this provision is intended to restrict
rights or obligations under the Americans with Disabilities Act or other
applicable law.

             (c)     Any leave on account of illness or temporary disability which is short
of Total Disability shall not constitute a breach of this Agreement by the
Executive and in no event shall any party be entitled to terminate this
Agreement for Cause (as defined below) due to any such leave. All physicians
selected hereunder shall be Board certified in the specialty most closely
related to the nature of the disability alleged to exist.

             4.4     Termination For Cause. The Company may, upon action of the
Board, and upon written notice to the Executive specifying in reasonable detail
the reason therefore, terminate the employment of the Executive at any time for
Cause (as defined in Attachment A); provided, however, that if the reason for
termination for Cause is susceptible of cure as determined by the Company, the
Executive shall have a period of fifteen (15) business days after such written
notice to effect a cure satisfactory to the Company.

             4.5     Termination Without Cause. The Company may also terminate the
employment of the Executive without Cause upon 30 days advance written notice
to the Executive, which termination shall

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constitute a “Termination Without Cause”. Termination without Cause shall not
include a termination due to death or Total Disability.

             4.6     Termination by Executive. The Executive may resign (and
thereby terminate his employment under this Agreement) at any time, by giving
the Company not less than thirty (30) days’ prior written notice to the
Company, but the Company after receipt of such notice, may waive all or part of
such notice period.

             4.7     Payments Upon Termination.

             (a)     (i)     If Executive’s employment is terminated by the Company without
Cause, the Company shall pay the Executive six (6) months Base Salary.
Notwithstanding anything to the contrary above, in the event of a change of
control of the Company, if the Executive is eligible for and has met the
conditions for receiving cash severance benefits under the Change-of-Control
Severance Plan, then the provisions set forth in such plan shall apply in lieu
of payments under this subsection (i).

                       ii)      The Company shall have no further liability to the Executive pursuant
to this Agreement, in the event of termination by the Company in a Termination
Without Cause or a termination by the Executive except as set forth in this
Section 4.7(a), including, without limitation, any liability to pay the
Executive any severance, bonus or any other compensation.

                       iii)      The Company also waives, releases and remises (A) any obligation or
duty under applicable law on the part of the Executive to seek or obtain other
engagements or employment or to otherwise mitigate any damages to which the
Executive may be entitled by reason of any termination of this Agreement; and
(B) any right in or claim to any remuneration or compensation received by
Executive pursuant to any engagements or employment subsequent to the
termination of this Agreement. Any payments made under this Section 4.7(a) or
the Change-of-Control Severance Plan may be conditioned upon execution by
Executive of a release of claims arising from or connected with his employment
in such form as may be specified by the Company (excluding from any such
release any rights Executive may have to indemnification or insurance coverage
with respect to his actions while employed by the Company under Directors and
officers or other insurance maintained by the Company or under the Company’s
indemnification policies and applicable law concerning indemnification).

             (b)     If the Executive’s employment is terminated (i) by the Company for
Cause, or (ii) by the Executive, then the Company shall have no duty to make
any payments or provide any benefits to the Executive pursuant to this
Agreement other than payment of the amount of the Executive’s Base Salary and
benefits accrued through the date of termination of his employment.

             (c)     Upon termination of Executive’s employment for death or Total
Disability, the Company shall pay to the Executive, or to his guardian or
personal representative, as the case may be, in addition to any insurance or
disability benefits to which he may be entitled under applicable insurance and
benefit programs contemplated by Section 3.4 and then in effect, all amounts
accrued or vested prior to such termination; provided, however, if cash
severance benefits are payable under the Change-of-Control Severance Plan as a
result of such termination, then the provisions set forth in such plan shall
apply in lieu of the foregoing. The Company shall have no further liability to
the Executive, guardian or personal representative pursuant to this Agreement,
including, without limitation, any liability to pay the Executive, guardian or
personal representative any severance, bonus or any other compensation.

             4.8     No Disparaging Comments Upon Termination.

     Upon termination of this Agreement and thereafter, the Executive shall
refrain from making any disparaging remarks about the businesses, services,
products, stockholders, officers, directors or other personnel of the GLGC
Group.

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     5.     Certain Covenants of the Executive.

             5.1     Necessity for Covenants. The Executive acknowledges that (i)
the GLGC Group (as defined below) is engaged and will in the future be engaged
in the Business as described in this Agreement; (ii) his employment pursuant to
this Agreement will give him access to customers and suppliers
of the GLGC Group; (iii) his employment will give him access to confidential
information and other trade secrets concerning the GLGC Group’s products,
services and the Business and (iv) the agreements and covenants contained in
this Section 5 are essential to protect the business and goodwill of the GLGC
Group. To induce the Company to enter into this Agreement and pay the
compensation and other benefits at the levels requested by the Executive, the
Executive enters into the following covenants:

             5.2     Definitions.

             (a)     “Business” for purposes of this Article 5 shall mean the provision by
the GLGC Group of genomic information and bioinformatics products and services
and pre-clinical testing and clinical trial services to the pharmaceutical and
biotechnology industry. The Business includes biosample collection, handling
and processing, genomic data production, and data management and software
systems development, to create a broad range of gene expression-based
information solutions that facilitate the drug discovery and development
process, as well as pre-clinical testing and clinical trial management and any
other products and services offered from time to time by the GLGC Group as
described in its annual and quarterly reports filed with the Securities and
Exchange Commission.

             (b)     “GLGC Group” for purposes of this Article 5 shall include the
Company, and all of its wholly or majority owned subsidiaries and affiliates
and successors and assigns of any of the foregoing.

             (c)     “Business Contact” shall mean any (i) customer which has
purchased goods or services provided by the GLGC Group during the Term, (ii)
prospective customer whom the Executive or persons working for or directly with
the Executive has contacted during the Term for the purpose of endeavoring to
sell the goods or services of the GLGC Group to the prospective customer, or
(iii) provider of material amounts of goods or services to the GLGC Group.

             (d)     “Service Area” means the entire world.

             (e)     “Term” means the term of employment as specified in Section 2
hereof

             5.3     Restrictive Covenants.

                       5.3.1  Restrictions. During the Term and for a period of two (2)
years after the date (the “Termination Date”) the Executive’s employment
hereunder is terminated (the “Restricted Period”) regardless of whether such
termination is voluntary or involuntary, with or without Cause or by
resignation, the Executive shall not, directly or indirectly, for himself or on
behalf of any other person, firm, corporation or other entity, whether as a
principal, agent, employee, stockholder, partner, officer, member, adviser,
consultant, director, sole proprietor, or otherwise:

             (a)     call upon or solicit any Business Contact for the purpose of
persuading the Business Contact to engage the Executive or any other person,
firm, corporation or other entity to provide goods or services which are the
same as or similar to those the GLGC Group provided or proposed to provide to
the Business Contact or to engage the Business Contact to provide goods or
services which are the same as or similar to those the Business Contact
provided to the GLGC Group to any other person, firm, corporation or other
entity;

             (b)     solicit, participate in or promote the solicitation of any person who
was employed by the GLGC Group at any time during the twelve (12) months
preceding the Termination Date to leave the employ of the GLGC Group, or hire
or engage or assist anyone to hire or engage any of those persons;

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             (c)     make any disparaging remarks about the GLGC Group’s business, services
or personnel;

             (d)     interfere in any way with the GLGC Group’s business, prospects or
personnel; or

             (e)     render services (other than services unrelated to the Business) to, or
become affiliated with, any person, company or other entity engaged in any
business that competes with the Business within the Service Area, directly or
indirectly, in any capacity; provided, however, that the Executive may own,
directly or indirectly, solely as an investment, securities which are publicly
traded if the Executive (a) is not a controlling person of, or a member of a
group which controls, the issuer and (b) does not, directly or indirectly, own
5% or more of any class of securities of the issuer.

             5.3.2  Severability of Covenants. The Executive acknowledges and
agrees that the Restrictive Covenants are reasonable and valid in geographical
and temporal scope and in all respects. If any court determines that any of
the Restrictive Covenants, or any part thereof, is invalid or unenforceable,
the remainder of the Restrictive Covenants shall not thereby be affected and
shall be given full effect, without regard to the invalid portions.

             5.3.3  Blue-Penciling. If any court determines that any of the
Restrictive Covenants, or any part thereof, is unenforceable because of the
duration or geographic scope of such provision, such court shall have the power
to reduce the duration or scope of such provision, as the case may be, and, in
its reduced form, such provision shall then be enforceable and shall be
enforced. If any such court declines to so revise such covenant, the parties
agree to negotiate in good faith a modification that will make such duration or
scope enforceable.

             5.4     Rights and Remedies Upon Breach. If the Executive breaches, or
threatens to commit a breach of, any of the provisions of Section 5.3 (the
“Restrictive Covenants”), the Company shall, in addition to its right
immediately to terminate this Agreement for Cause, have the right and remedy
(which right and remedy shall be independent of others and severally
enforceable, and which shall be in addition to, and not in lieu of, any other
rights and remedies available to the Company under law or in equity) to have
the Restrictive Covenants specifically enforced by any court having
jurisdiction, it being acknowledged and agreed that any such breach or
threatened breach could cause irreparable injury to the Company and that money
damages may not provide an adequate remedy to the Company.

     6.     Representations of Executive. The Executive represents and
warrants that: (a) his employment by the Company will not (i) violate any
non-disclosure agreements, covenants against competition, or other restrictive
covenants or agreements made by the Executive with, to or for the benefit of
any previous employer or partner, or (ii) violate or constitute a breach or
default under, any statute, law, judgment, order, decree, writ, injunction,
deed, instrument, contract, lease, license or permit to which the Executive is
a party or by which the Executive is bound; (a) there is no litigation,
proceeding or investigation of any nature (either civil or criminal) which is
pending or, to the best of the Executive’s knowledge, threatened against or
affecting the Executive or which would adversely affect his ability to
substantially perform the duties herein; and (b) he has received or been given
the opportunity to review the provisions of this Agreement, and the meaning and
effect of each provision, with independent legal counsel of the Executive’s
choosing.

     7.     Confidentiality and Proprietary Inventions Agreement. As a
condition to his employment by the Company, the Executive agrees to enter into
and be bound by the provisions set forth in the Company’s Proprietary
Information and Inventions Agreement, which is expressly incorporated by
reference hereto.

     8.     Dispute Resolution.

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             8.1     Arbitration Policy. Subject to the Company’s right to seek
injunctive or other equitable relief as specified in Section 5.4 of this
Agreement or in the Proprietary Information and Inventions Agreement, the
Parties agree that arbitration is the required and exclusive forum for the
resolution of any and all disputes between them, including claims arising under
statute, common law, or this Agreement. This mandatory arbitration provision
includes without limitation any claims or actions under Title VII of the Civil
Rights Act of 1964, the Civil Rights Act of 1866 (“Section 1981”), the
Americans with Disabilities Act, the Family and Medical Leave Act, the Age
Discrimination in Employment Act, the Fair Labor Standards Act, the Equal Pay
Act, the Employee Retirement Income Security Act, and any other
federal, state or local statute, law or regulation regarding employment,
employment discrimination, terms and conditions of employment, compensation or
termination of employment. This mandatory arbitration provision includes any
dispute between the Executive and the Company or its parents, subsidiaries and
affiliates, and its and their current and former officers, directors, employees
and agents.

     Any covered dispute must be submitted to arbitration in accordance with
the National Rules for the Resolution of Employment Disputes of the American
Arbitration Association. Any such arbitration will be conducted in Montgomery
County, Maryland, and will be decided in accordance with and determined by the
laws of the State of Maryland and/or applicable federal law. The Executive
specifically agrees that the Company may seek specific performance of this
provision, as well as other injunctive relief, from the state or federal courts
in Maryland. The arbitrator shall not have the authority to award punitive
damages, costs or attorneys’ fees to either Party except where expressly
provided for by the applicable law.

     Except as otherwise provided by applicable law, the administrative costs
of the arbitration (filing fees, cost for the arbitration site, other AAA fees,
arbitrator’s fee) shall be divided equally between the parties. The fees and
expenses of any witness shall be paid by the Party requiring the presence of
such witness. Each Party shall bear its own costs and expenses in all other
respects. The resolution of any dispute achieved through such arbitration
shall be final and binding and enforceable by a court of competent
jurisdiction.

             8.2     No Jury Trial. NEITHER PARTY SHALL ELECT A TRIAL BY JURY IN
ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN ANY WAY
CONNECTED WITH THIS AGREEMENT.

             8.3     Personal Jurisdiction. Both parties agree to submit to the
jurisdiction and venue of the state courts in Montgomery County, Maryland as to
matters involving enforcement of this Agreement, including any award under an
arbitration proceeding.

     9.     Other Provisions.

             9.1     Notices. Any notice or other communication required or which
may be given hereunder shall be in writing and shall be delivered personally,
telegraphed, telexed, sent by facsimile transmission, sent by nationally
recognized overnight courier service such as FedEx or UPS or sent by certified,
registered or express mail, postage paid, and shall be deemed given when so
delivered personally, telegraphed, telexed or sent by facsimile transmission
or, if sent by courier on the second business after delivery by the courier
service or, if mailed, four days after the date of mailing, as follows:

	 
	(a)     if to the Company, to:
	 
	Gene Logic, Inc.
	610 Professional Drive
	Gaithersburg, MD 20879
	Attention: Chief Executive Officer
	 
	with copies to:

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	Ariel Vannier, Esquire
	Venable, Baetjer, Howard and Civiletti, LLP
	575 7th Street, NW
	Washington, DC 20004
	 
	(b)     if to the Executive, to:
	 
	Robert Proulx
	14509 Cervantes Ave
	Darnestown, MD 20874

             Any party may by notice given in accordance with this Section to the other
party designate another address or person for receipt of notices hereunder.

             9.2     Entire Agreement. This Agreement contains the entire agreement
between the parties with respect to the subject matter hereof and supersedes
all prior agreements and understandings, written or oral, with respect thereto.

             9.3     Waivers and Amendments. This Agreement may be amended,
modified, superseded, canceled, renewed or extended, and the terms and
conditions hereof may be waived, only by a written instrument signed by the
Executive and a duly authorized officer of the Company (each, in such capacity,
a party) or, in the case of a waiver, by the party waiving compliance. No
delay on the part of any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof, nor shall any waiver on the part
of any party of any right, power or privilege hereunder, nor any single or
partial exercise of any right, power or privilege hereunder, preclude any other
or further exercise thereof or the exercise of any other right, power or
privilege hereunder.

             9.4     Governing Law. This Agreement has been negotiated and is to be
performed in the State of Maryland, and shall be governed and construed in
accordance with the laws of the State of Maryland applicable to agreements made
and to be performed entirely within such State.

             9.5     Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.

             9.6     Confidentiality. Neither party shall disclose the contents of
this Agreement to any person, firm or entity, except the agents or
representatives of the parties, or except as required by law.

             9.7     Word Forms. Whenever used herein, the singular shall include
the plural and the plural shall include the singular. The use of any gender or
tense shall include all genders and tenses.

             9.8     Headings. The Section headings have been included for
convenience only, are not part of this Agreement, and are not to be used to
interpret any provision hereof.

             9.9     Binding Effect and Benefit. This Agreement shall be binding
upon and inure to the benefit of the parties, their successors, heirs, personal
representatives and other legal representatives. This Agreement may be
assigned by the Company to any entity that buys substantially all of the
Company’s assets or to any affiliate of the Company with the consent of the
Executive that shall not be unreasonably withheld. However, the Executive may
not assign this Agreement without the prior written consent of the Company.

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             9.10    Separability. The covenants contained in this Agreement are
separable, and if any court of competent jurisdiction declares any of them to
be invalid or unenforceable, that declaration of invalidity or unenforceability
shall not affect the validity or enforceability of any of the other covenants,
each of which shall remain in full force and effect.

     IN WITNESS WHEREOF, the parties, intending to be legally bound, have executed
this Agreement as of the day and year first above written.

	 	 	 
	 	 	
                              GENE LOGIC INC.
	 
	 
	____________

Dated	 	
By   /s/ Mark D. Gessler          (SEAL)

           President and

           Chief Executive Officer
	 
	 	 	
                              EXECUTIVE:
	 
	____________

Dated	 	
       /s/ Robert Proulx                     (SEAL)

  

  

  

  

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Attachment A

Definition of “Cause”

“Cause” shall mean

	(i)	 	commission of an act or omission which the Company determines would
constitute a felony or a misdemeanor which, in the Company’s reasonable
opinion, could have a material adverse effect on the Company’s business,
financial condition, prospects or reputation or the Executive’s
performance of his duties, under the laws of the United States or of any
state or a crime involving moral turpitude, including, but not limited to,
fraud, theft, embezzlement or any crime that results in or is intended to
result in personal enrichment at the expense of the Company;
	(ii)	 	material breach by the Executive of any agreement entered into between
the Executive and the Company;
	(iii)	 	willful misconduct by the Executive or gross negligence of the Executive
which could have a material adverse impact on the Company;
	(iv)	 	a material failure of the Executive in the performance of the Executive’s
duties provided that, if susceptible of cure as determined by the Company,
notice is provided and Executive does not cure such failure within fifteen
(15) business days after the date of such notice in a manner reasonably
satisfactory to the Company;
	(v)	 	the violation by the Executive of the restrictive covenants in Section
5.3 hereof or the provisions of the Proprietary Information and Inventions
Agreement; or
	(vi)	 	engagement in any activity that constitutes a material conflict of
interest with the Company.

With respect to any criminal act, the Company may base such a determination on
facts available to it or on an arrest or charges by an appropriate government
authority and may, at its option, suspend the Executive without pay in lieu of
immediate termination in the event of any criminal charges, pending additional
information, criminal conviction or other action.

  

  

  

  

  

10<PAGE>
                                                                     EXHIBIT 4.1

                       THIRD AMENDMENT TO CREDIT AGREEMENT

         THIS THIRD AMENDMENT TO CREDIT AGREEMENT (the "Amendment"), dated and
effective as of August 19, 2003, is made by and among ARCH COAL, INC., a
Delaware corporation (the "Borrower"), the LENDERS (as hereinafter defined),
JPMORGAN CHASE BANK, in its capacity as syndication agent, CITIBANK, N.A.,
CREDIT LYONNAIS NEW YORK BRANCH and U.S. BANK NATIONAL ASSOCIATION, each in its
capacity as a documentation agent, and PNC BANK, NATIONAL ASSOCIATION, in its
capacity as administrative agent for the Lenders (hereinafter referred to in
such capacity as the "Administrative Agent").

                              W I T N E S S E T H:

         WHEREAS, the Borrower, JPMorgan Chase Bank (successor in such capacity
to Morgan Guaranty Trust Company of New York), as syndication agent, Wachovia
Corporation (successor in such capacity to First Union National Bank), as
documentation agent, PNC Bank, National Association, as administrative agent,
and certain lenders are parties to that Credit Agreement dated as of June 1,
1998, as amended as of January 21, 2000, as amended and restated as of April 18,
2002, and as further amended as of January 27, 2003 and June 25, 2003 (the
"Original Credit Agreement");

         WHEREAS, the Borrower proposes to consummate certain transactions,
otherwise referred to as the Vulcan Acquisition (as hereinafter defined), as
contemplated by and subject to the terms and conditions of the Vulcan Merger
Agreement (as hereinafter defined); and

         WHEREAS, subject to the terms and conditions hereinafter provided and
effective upon the consummation of the Vulcan Acquisition, the parties desire to
amend and restate the Original Credit Agreement as hereinafter provided.

         NOW, THEREFORE, the parties hereto, in consideration of their mutual
covenants and agreements hereinafter set forth and intending to be legally bound
hereby, covenant and agree as follows:

         1. Recitals.

         The foregoing recitals are true and correct and incorporated herein by
reference.

         2. Definitions.

         The following words and terms shall have the following meanings,
respectively:

                  Amended and Restated Credit Agreement shall mean that certain
Amended and Restated Credit Agreement attached hereto as Exhibit A.

<PAGE>

                  Vulcan Acquisition shall mean the transactions contemplated by
the Vulcan Merger Agreement.

                  Vulcan Merger Agreement shall mean that certain Merger and
Purchase Agreement among Borrower, Triton Acquisition LLC, a Delaware limited
liability company, New Vulcan Holdings, L.L.C., a Delaware limited liability
company and Vulcan Coal Holdings, L.L.C., a Delaware limited liability company,
dated as of May 29, 2003, together with all schedules and exhibits thereto.

                  All other capitalized terms used herein unless otherwise
defined herein shall have the meanings ascribed to them in the Original Credit
Agreement.

         3. Amendment and Restatement of Original Credit Agreement.

         The Amended and Restated Credit Agreement shall become effective and
shall automatically amend and restate the Original Credit Agreement, without
further action, upon the date of the satisfaction of all conditions set forth in
Section 6.1 of the Amended and Restated Credit Agreement, which conditions
(including all definitions and sections of the Amended and Restated Credit
Agreement that are referred to in such Section 6.1) are expressly incorporated
herein by reference and made a part hereof (collectively, the "Restatement
Closing Conditions").

         It is expressly agreed that any amendment to any of the Restatement
Closing Conditions or any waiver of any of the Restatement Closing Conditions
shall require the prior written approval of the Required Banks and of the
Borrower, which approval shall be binding on all of the Banks.

         4. Amendment to Original Credit Agreement.

         Clauses (v) and (vi) of Section 7.2.4 [Disposition of Assets or
Subsidiaries] of the Original Credit Agreement are hereby amended and restated
in their entirety to read as follows:

                  "(v) any sale, transfer or lease (including any lease
                  transaction under Section 7.2.9 [Off-Balance Sheet Financing
                  and Capital Leases]) of assets, other than those specifically
                  excepted pursuant to clauses (i) through (iv) above or clauses
                  (vi), (vii), (viii), (ix) or (x) below, provided that any
                  disposition of assets by Borrower after the consummation of
                  the MLP Transaction to the master limited partnership or
                  similar entity formed in connection with the MLP Transaction
                  shall be subject to and governed by solely this clause (v),
                  provided further that with respect to any sale, transfer or
                  lease pursuant to this Section 7.2.4(v): (a) at the time of
                  any such disposition, no Event of Default shall exist or shall
                  result from such disposition, (b) the Borrower and its
                  Subsidiaries shall be in compliance with the covenants
                  contained in Sections 7.2.10 [Maximum Leverage Ratio], 7.2.11
                  [Minimum Fixed Charge Coverage Ratio], and 7.2.12 [Minimum Net
                  Worth] determined on a pro forma basis after giving effect to
                  each such sale, transfer or lease of assets, and (c) the
                  aggregate net book

                                       2
<PAGE>

                  value, as determined in accordance with GAAP, of all assets so
                  sold, transferred, or leased by the Borrower and its
                  Subsidiaries shall not exceed in any calendar year
                  $40,000,000;

                  (vi) subject to the first proviso of clause (v) above, any
                  sale, transfer or lease of assets, other than those
                  specifically excepted pursuant to clauses (i) through (v)
                  above or clauses (vii), (viii), (ix) or (x), below, so long as
                  (y) in the case of any such permitted transaction by any
                  member of the Arch Coal Group, a permanent reduction of the
                  Revolving Credit Commitments with respect to the Net Cash
                  Proceeds thereof is made in accordance with the provisions of
                  Section 4.4.5, and (z) in the case of any such permitted
                  transaction by any member of the Arch Western Group, the
                  mandatory payments and/or redemptions of the Indebtedness of
                  Arch Western or the applicable Subsidiary of Arch Western are
                  made in accordance with Section 4.09 of the AWR Senior Notes
                  Indenture or the mandatory redemptions of other Permitted
                  Additional AWR Indebtedness are made in accordance with the
                  indenture or agreement to which such Permitted Additional AWR
                  Indebtedness is subject;"

         5. Conditions of Effectiveness of this Amendment.

         The effectiveness of this Amendment is expressly conditioned upon
satisfaction of each of the following conditions precedent:

         (a) Fees and Expenses. The Borrower shall pay or cause to be paid, on
the Third Amendment Effective Date (as hereinafter defined) all fees and
expenses set forth in that certain agreement among the Borrower, the
Administrative Agent and PNC Capital Markets, Inc., regarding fees payable in
connection with this Amendment, including, without limitation: (i) to the
Administrative Agent for itself the reasonable costs and expenses of the
Administrative Agent including, without limitation, reasonable fees of the
Administrative Agent's counsel in connection with this Amendment, and (ii) to
the Administrative Agent for the benefit of each Lender approving this Amendment
on or prior to the Third Amendment Effective Date, a fee equal to 18.75 basis
points of each such Lender's Revolving Credit Commitment as of the Third
Amendment Effective Date.

         (b) No Default. Confirmation of Representations and Warranties, etc. As
of the Third Amendment Effective Date after giving effect to this Amendment, no
Event of Default or Potential Default shall have occurred. The Borrower by
executing this Amendment hereby certifies and confirms that as of the date
hereof and after giving effect to this Amendment: (a) the execution, delivery
and performance of this Amendment and any and all other documents executed
and/or delivered in connection herewith have been authorized by all requisite
corporate action on the part of the Borrower and will not violate the Borrower's
articles of incorporation or bylaws, (b) no Event of Default or Potential Event
of Default has occurred or would result from the execution, delivery and
performance of this Amendment, (c) the representations and warranties of the
Loan Parties contained in the Original Credit Agreement and the other Loan
Documents are true and correct on and as of the date hereof with the same force
and effect as

                                       3
<PAGE>

though made by the Loan Parties on such date (except representations and
warranties that relate solely to an earlier date or time), and (d) the Original
Credit Agreement (as amended by this Amendment) and all other Loan Documents are
and remain legal, valid, binding and enforceable obligations in accordance with
the terms thereof.

         (c) Confirmation of Loan Documents. Each Loan Party (other than the
Borrower) shall have duly executed and delivered to the Administrative Agent the
Confirmation of Loan Documents in the form attached hereto as Exhibit B.

         (d) Organization, Authorization and Incumbency. There shall be
delivered to the Administrative Agent for the benefit of each Lender a
certificate, dated as of the date hereof and signed by the Secretary or an
Assistant Secretary of each Loan Party, certifying as appropriate as to:

                  (i) all action taken by such Loan Party in connection with
         this Amendment and the other Loan Documents;

                  (ii) the names of the officer or officers authorized to sign
         this Amendment and the other documents executed and delivered in
         connection herewith and described in this Section 5 and the true
         signatures of such officer or officers and specifying the officers
         authorized to act on behalf of each Loan Party for purposes of the Loan
         Documents and the true signatures of such officers, on which the Agents
         and each Lender may conclusively rely; and

                  (iii) copies of its organizational documents, including its
         certificate of incorporation and bylaws if it is a corporation, its
         certificate of partnership and partnership agreement if it is a
         partnership, and its certificate of organization and limited liability
         company operating agreement if it is a limited liability company, in
         each case as in effect on the date hereof, certified by the appropriate
         state official where such documents are filed in a state office
         together with certificates from the appropriate state officials as to
         the continued existence and good standing of each of the Loan Parties
         in each state where organized or qualified to do business; provided
         that each of the Loan Parties other than Borrower may, in lieu of
         delivering copies of the foregoing organizational documents and good
         standing certificates, certify that the organizational documents and
         good standing certificates previously delivered by the Loan Parties to
         the Administrative Agent remain in full force and effect and have not
         been modified, amended or rescinded.

         (e) Consents and Approvals. To the extent any consent, approval, order,
or authorization or registration, declaration, or filing with any governmental
authority or other person or legal entity is required in connection with the
valid execution and delivery of this Amendment or the carrying out or
performance of any of the transactions required or contemplated by this
Amendment, all such consents, approvals, orders or authorizations shall have
been obtained or all such registrations, declarations, or filings shall have
been accomplished prior to the consummation of this Amendment.

                                       4
<PAGE>

         (f) Litigation. Except as disclosed in the schedules to the Original
Credit Agreement, on the date hereof no action, proceeding, investigation,
regulation or legislation shall have been instituted, threatened or proposed
before any court, governmental agency or legislative body to enjoin, restrain or
prohibit, or to obtain damages in respect of, this Amendment or any other Loan
Documents or the consummation of the transactions contemplated hereby or thereby
or which, in the Administrative Agent's sole discretion, would make it
inadvisable to consummate the transactions contemplated by this Amendment or any
of the other Loan Documents.

         (g) Legal Details; Counterparts. All legal details and proceedings in
connection with the transactions contemplated by this Amendment shall be in form
and substance satisfactory to the Administrative Agent, the Administrative Agent
shall have received from the Borrower and the Lenders an executed original of
this Amendment and the Administrative Agent shall have received all such other
counterpart originals or certified or other copies of such documents and
proceedings in connection with such transactions, in form and substance
satisfactory to the Administrative Agent.

This Amendment shall be dated as of and shall become effective on the date that
(such date being hereinafter referred to as the "Third Amendment Effective
Date"): (i) it has been duly executed by the Borrower, the Administrative Agent
and the Required Banks, and (ii) each of the conditions set forth in this
Section 5 has been satisfied.

         6. Force and Effect.

         No novation is intended or shall occur by or as a result of this
Amendment. The Borrower reconfirms, restates, and ratifies the Original Credit
Agreement (as amended by this Amendment), each of the other Loan Documents and
all other documents executed in connection therewith, and the Borrower confirms
that all such documents have remained in full force and effect since the date of
their execution. This Amendment is not intended to constitute, nor does it
constitute, an interruption, suspension of continuity, satisfaction, discharge
of prior duties, novation, or termination of the liens, security interests,
indebtedness, loans, liabilities, expenses, or obligations under the Original
Credit Agreement or the other Loan Documents. The Borrower and the
Administrative Agent and each of the Lenders acknowledges and agrees that the
Collateral has continued to secure the indebtedness, loans, liabilities,
expenses, and obligations under the Original Credit Agreement since the date of
execution of each applicable Loan Document, and all liens and security interests
in the Collateral which were granted pursuant to any of the Loan Documents shall
remain in full force and effect from and after the date hereof.

         7. Opinions of Counsel.

         On or before August 19, 2003, there shall be delivered to the
Administrative Agent for the benefit of each Lender the opinion of legal counsel
to the Loan Parties, in form and substance reasonably satisfactory to the
Administrative Agent and its counsel as to the matters set forth on Exhibit C to
this Amendment and as to such other matters incident to such transactions as the
Administrative Agent may reasonably request.

                                       5
<PAGE>

         8. Governing Law.

         This Amendment shall be deemed to be a contract under the laws of the
Commonwealth of Pennsylvania and for all purposes shall be governed by and
construed and enforced in accordance with the internal laws of the Commonwealth
of Pennsylvania without regard to its conflict of laws principles.

         9. Counterparts.

         This Amendment may be signed in any number of counterparts each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.

                         [SIGNATURES BEGIN ON NEXT PAGE]

                                       6
<PAGE>

                      [SIGNATURE PAGE TO THIRD AMENDMENT TO
                        ARCH COAL, INC. CREDIT AGREEMENT]

         IN WITNESS WHEREOF, the parties hereto, by their officers thereunto
duly authorized, have executed this Amendment as of the day and year first above
written.

ATTEST:                                ARCH COAL, INC.

                                       By:                                [Seal]
---------------------------------         --------------------------------
Janet L. Horgan                        Name:  Robert J. Messey
Assistant Secretary                    Title: Senior Vice President and Chief
                                              Financial Officer

<PAGE>

                      [SIGNATURE PAGE TO THIRD AMENDMENT TO
                        ARCH COAL, INC. CREDIT AGREEMENT]

                                       PNC BANK, NATIONAL ASSOCIATION,
                                       individually and as Administrative Agent

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

<PAGE>

                      [SIGNATURE PAGE TO THIRD AMENDMENT TO
                        ARCH COAL, INC. CREDIT AGREEMENT]

                                       JPMORGAN CHASE BANK, individually and as
                                       Syndication Agent

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

<PAGE>

                      [SIGNATURE PAGE TO THIRD AMENDMENT TO
                        ARCH COAL, INC. CREDIT AGREEMENT]

                                       CITIBANK, N.A., individually and as
                                       Documentation Agent

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

<PAGE>

                      [SIGNATURE PAGE TO THIRD AMENDMENT TO
                        ARCH COAL, INC. CREDIT AGREEMENT]

                                       CREDIT LYONNAIS NEW YORK BRANCH,
                                       individually and as Documentation Agent

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

<PAGE>

                      [SIGNATURE PAGE TO THIRD AMENDMENT TO
                        ARCH COAL, INC. CREDIT AGREEMENT]

                                       U.S. BANK NATIONAL ASSOCIATION,
                                       individually and as Documentation Agent

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

<PAGE>

                      [SIGNATURE PAGE TO THIRD AMENDMENT TO
                        ARCH COAL, INC. CREDIT AGREEMENT]

                                       BANK LEUMI USA

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

<PAGE>

                      [SIGNATURE PAGE TO THIRD AMENDMENT TO
                        ARCH COAL, INC. CREDIT AGREEMENT]

                                       BNP PARIBAS

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

<PAGE>

                      [SIGNATURE PAGE TO THIRD AMENDMENT TO
                        ARCH COAL, INC. CREDIT AGREEMENT]

                                       CREDIT INDUSTRIEL ET COMMERCIAL

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

<PAGE>

                      [SIGNATURE PAGE TO THIRD AMENDMENT TO
                        ARCH COAL, INC. CREDIT AGREEMENT]

                                       FLEET NATIONAL BANK

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

<PAGE>

                      [SIGNATURE PAGE TO THIRD AMENDMENT TO
                        ARCH COAL, INC. CREDIT AGREEMENT]

                                       MIZUHO CORPORATE BANK, LIMITED

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

<PAGE>

                      [SIGNATURE PAGE TO THIRD AMENDMENT TO
                        ARCH COAL, INC. CREDIT AGREEMENT]

                                       THE BANK OF NEW YORK

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

<PAGE>

                      [SIGNATURE PAGE TO THIRD AMENDMENT TO
                        ARCH COAL, INC. CREDIT AGREEMENT]

                                       WACHOVIA BANK, NATIONAL ASSOCIATION

                                       By:
                                          --------------------------------------
                                       Name:
                                            ------------------------------------
                                       Title:
                                             -----------------------------------

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