EXHIBIT 10.15
1997 FORM 10-K
AMENDMENT NO. 1
to
EMPLOYMENT AGREEMENT
AMENDMENT NO. 1 dated March 5, 1998 (this "Amendment") to EMPLOYMENT AGREEMENT
made and entered into March 11, 1996 (the "Original Agreement") by and between
BUCYRUS INTERNATIONAL, INC., a Delaware corporation formerly known as
Bucyrus-Erie Company, and WILLARD R. HILDEBRAND.
TERMS used in this Amendment that are defined in the Original Agreement and
not defined otherwise in this Amendment shall have the meanings assigned to
such terms in the Original Agreement.
THE COMPANY and the Executive desire to amend and modify various provisions of
the Original Agreement:
NOW, THEREFORE, the parties hereby agree as follows:
1. Term.
1.1 The "Initial Term" shall continue until March 11, 2000.
1.2 The "Term" shall include a "Full-Time Period" and may also include a
"Part-Time Period".
1.3 The Full-Time Period shall continue until the earlier to occur of (i)
such date, if any, as the Company and the Executive mutually agree in writing
that a new person is ready to assume the responsibilities of Chief Executive
Officer of the Company or (ii) the date of termination of Executive's
employment under the Agreement. The Executive and the Company will use their
mutual best efforts to identify and select no later than December 31, 1998 a
new person to assume the responsibilities of Chief Executive Officer of the
Company.
1.4 The Part-Time Period shall commence on such date, if any, as the Company
and the Executive mutually agree in writing that a new person is ready to
assume the responsibilities of Chief Executive Officer of the Company and
shall continue until the date of termination of Executive's employment under
the Agreement.
2. Office.
2.1 During the Full-Time Period, the Executive shall hold the office of
President and Chief Executive Officer of the Company.
2.2 During the Part-Time Period, the Executive shall hold the office of Vice
Chairman of the Company.
2.3 During both the Full-Time Period and the Part-Time Period, the Executive
and/or his Permitted Transferees (as defined in the Stockholders Agreement
referred to in Section 8.2 below) shall serve as a director of the Company,
provided that the Executive and/or his Permitted Transferees (as defined in
the Stockholders Agreement referred to in Section 8.2 below) maintains
ownership of the shares of Company Common Stock referenced in Section 8.1
hereof.
3. Duties.
3.1 During the Full-Time Period, the Executive shall have the duties set
forth in Section 2 of the Original Agreement.
3.2 During the Part-Time Period, (i) the Executive's duties shall be limited
to advising the Chief Executive Officer of the Company on strategic planning
and international business development issues, and (ii) the Executive shall
not be required to devote more than 5 days per month to the business and
affairs of the Company.
4. Base Salary and Bonuses.
4.1 During the Full-Time Period, the Executive shall be paid the Base Salary
and Bonuses provided for in Section 3 of the Original Agreement; provided,
however, that, effective as of October 1, 1997, the Executive's Base Salary
shall be increased to $450,000 per annum, with a retroactive payment to be
made by the Company to the Executive as soon as reasonably practicable.
4.2 During the Part-Time Period, the Executive shall be paid a Base Salary
of $120,000 per annum, but shall not be entitled to receive any annual bonus.
5. Benefit Plan.
During both the Full-Time Period and the Part-Time Period, the Executive shall
be entitled to the benefits provided for in Sections 7 and 8 of the Original
Agreement, provided that during the Part-Time period the Executive shall not
be entitled to receive any vacation benefits.
6. Termination.
6.1 In the event of the termination of the Executive's employment during the
Term, (i) the Executive shall be entitled to the severance benefits and
payments provided for in Section 9(b) of the Original Agreement if such
termination is by the Executive other than by reason of his death or
disability, (ii) the Executive shall be entitled to the severance benefits and
payments provided for in Section 9(d) of the Original Agreement if such
termination is by reason of the Executive's death or Disability or is by the
Company without Cause, provided, that if such termination of employment occurs
during the Part-Time Period, the Executive shall not be entitled to receive
any payment pursuant to Section 9(d)(ii) of the Original Agreement (other than
any bonus payable with respect to the Final Year) and (iii) the Executive
shall be entitled to the severance benefits and payments provided for in
Section 9(e) of the Original Agreement if such termination is by the Company
for Cause.
6.2 The provisions of Section 9(f) of the Original Agreement shall apply
during both the Full-Time Period and the Part-Time Period.
7. Change in Control.
The provisions of Section 10(b) and 10(c) of the Original Agreement shall
apply with respect to (i) the Change in Control of the Company that resulted
from the acquisition of the Company by American Industrial Partners effective
September 26, 1997 (the "AIP Change in Control") and (ii) any subsequent
Change in Control of the Company that takes place during the Full-Time Period.
For purposes of any Change in Control of the Company other than the AIP Change
in Control, the definition of a "Change in Control of the Company" in
Section 10(a)(ii) of the Original Agreement shall be modified as follows:
(i) Clause (A) shall be modified by replacing the phrase "on the
date of this Agreement" with "on September 26, 1997", and by
changing "20%" to "50%".
(ii) The first clause of Clause (D) shall be modified to read
"During any period of two consecutive years (but not
including any period of time prior to September 26, 1997),";
and
(iii) Clauses (E) and (F) shall be deleted.
For purposes of the definition of "Good Reason" in Section 10(a)(v) of the
Original Agreement, the phrase "Effective Date" in Clauses (B), (C) and (D)
shall mean the date of this Amendment.
8. Options.
8.1 It is proposed that the Executive subscribe for and purchase up to 4,000
shares of the Company's Common Stock at a price of $100 per share.
8.2 If the Executive subscribes for and purchases shares of the Company's
Common Stock as described in Section 8.1, (i) the Executive will be granted
options ("Options") under the Company's 1997 Management Stock Option Plan (the
"Option Plan") and (ii) the Executive will enter into a Stockholders Agreement
(the "Stockholders Agreement") with the Company, American Industrial Partners
Acquisition Company, LLC, and certain other Management Stockholders.
8.3 The Options will have an Exercise Price of $100 per share, and the
number of Option Shares issuable upon exercise of the Options shall be seven
times the number of shares of Common Stock that the Executive subscribes for
and purchases as described in Section 8.1.
8.4 Notwithstanding anything in the Original Agreement, the Stockholders
Agreement, the Option Plan, or any Option to the contrary in the event of the
termination of the Executive's employment during the Term by the Company
without Cause, the unvested portion of any Options held by the Executive that
would otherwise have vested through the later of (i) March 11, 2000, or (ii)
one year following the effective date of the Executive's termination of
employment with the Company (the "Severance Vesting Date"), shall immediately
vest, and all vested Options held by Executive (including those vesting
pursuant to this clause) shall remain exercisable through the Severance
Vesting Date. In determining the extent of such Option vesting, (i) it shall
be assumed for purposes of the Option Plan that all performance-based targets
for the Plan Year in which Executive's employment terminates and all
subsequent Plan Years through the Severance Vesting Date are achieved at the
100% level, and (ii) with respect to the Plan Year in which the Severance
Vesting Date occurs, such Option vesting shall be pro rata through the
Severance Vesting Date.
8.5 The provisions of Sections 5 and 6 of the Original Agreement, having
previously been performed, are hereby deleted.
EXCEPT AS provided in this Amendment, the Original Agreement continues in full
force and effect in accordance with its terms.
BUCYRUS INTERNATIONAL, INC.
By: /s/Robert L. Purdum /s/W. R. Hildebrand
ROBERT L. PURDUM WILLARD R. HILDEBRAND
Its Chairman of the Board