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Exhibit 10.10
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, effective as of January 1, 2001 (the "Effective
Date"), by and between OLYMPIC STEEL, INC., an Ohio corporation, with its
principal place of business at 5096 Richmond Road, Bedford, Ohio 44146
(hereinafter referred to as "Olympic"), and DAVID A. WOLFORT, an individual
residing at 70 Ridgecreek Trail, Moreland Hills, Ohio 44022 (hereinafter
referred to as "Wolfort").
WHEREAS, Wolfort has served for many years as an executive officer of
Olympic, including since 1995 as Chief Operating Officer;
WHEREAS, Olympic desires to assure itself of the continued employment
of Wolfort;
NOW, THEREFORE, the parties hereto agree as follows:
1. TERM. Olympic hereby employs Wolfort and Wolfort hereby accepts such
employment, for an initial term commencing on the Effective Date and ending on
December 31, 2005, unless sooner terminated in accordance with the provisions of
Section 4 or Section 5; with such employment to continue in accordance with the
terms of this Agreement from year to year thereafter (subject to termination as
aforesaid) unless either party notifies the other party in writing prior to
thirty (30) days before the expiration of the initial term and each annual
renewal thereof (said initial term and any continuation thereof (but not after
any such termination) being hereinafter referred to as the "Term").
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2. DUTIES. Wolfort shall serve as President and Chief Operating Officer
and shall faithfully perform for Olympic the duties of an executive, managerial
or administrative nature as shall be specified and designated from time to time
by the Chief Executive Officer and/or the Board of Directors of Olympic. Wolfort
shall devote substantially all of his business time and effort to the
performance of his duties hereunder.
3. COMPENSATION.
3.1 SALARY. (a) Olympic shall pay Wolfort during the Term a salary
at the rate of Three Hundred Eighty Five Thousand Dollars ($385,000) per annum
(the "Annual Salary"), commencing January 1, 2001. The Annual Salary may be
increased by an amount as the Compensation Committee of the Board of Directors
shall determine in its sole discretion. The Annual Salary shall be payable in
accordance with the Company's standard payroll practices.
3.2 BENEFITS. Wolfort shall be permitted during the Term to
participate in all group life, hospitalization or disability insurance plans,
health programs, retirement plans or similar benefits that are generally
available to other senior executive officers of Olympic, on the same terms as
such other executives, in each case to the extent that Wolfort is eligible under
the terms of such plans or programs.
3.3 EXPENSES. Olympic shall pay or reimburse Wolfort for all
reasonable out-of-pocket expenses actually incurred or paid by Wolfort during
the Term in the performance of Wolfort's services under this Agreement; provided
that Wolfort
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submits proof of such expenses, with the properly completed forms as prescribed
from time to time by Olympic.
3.4 ANNUAL BONUS. During the Term, Wolfort shall be entitled to
participate in the Senior Management Compensation Program, in such amount and
with such target levels as is determined by the Compensation Committee of the
Board of Directors, provided, however, during the Term the Annual Bonus shall
not be less than Twenty Thousand Dollars ($20,000) (the "Annual Bonus").
3.5 STOCK OPTIONS. On the Effective Date, Wolfort shall be
granted non-qualified stock options to purchase 300,000 shares of Olympic
Common Stock. The Option Price shall be the last closing sale price of a share
of Common Stock on the date of grant, or, if not a business day, the business
day immediately preceding such date. The option shares shall vest in annual
increments of 20% each year, commencing January 1, 2002. The options shall
terminate on December 31, 2010, unless earlier terminated in accordance with
the Notice of Grant attached hereto and the term of the Option Plan. In the
event of a sale of Olympic and the consideration for the Olympic shares
consists of cash or other consideration (excluding common stock of the
acquiring company or its parent), then all non-vested options shall become
fully vested as of the time immediately prior to the effective time of the
sale. In the event of a sale of Olympic and the consideration for the Olympic
shares consists of shares of the acquiring company or its parent, if Wolfort
does not execute a new employment contract with the purchaser, then all
non-vested options shall become fully vested as of the time immediately prior
to the effective time of the sale.
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4. DEATH OR DISABILITY.
4.1 TERMINATION OF EMPLOYMENT. If Wolfort dies during the Term,
the obligations of Olympic to or with respect to Wolfort shall terminate in
their entirety except as otherwise provided under this Section 4.1. If Wolfort
by virtue of ill health or other physical or mental disability is unable to
perform substantially and continuously any material portion of the duties
assigned to him for one hundred eighty (180) days in the aggregate during any
twelve (12) month period, or for any ninety (90) consecutive days, Olympic shall
have the right to terminate the employment of Wolfort upon notice in writing to
Wolfort; provided that (i) after receipt of notice from Olympic, Wolfort shall
have the right within ten (10) days after such notice to dispute Olympic's
ability to terminate him under this Section 4.1, (ii) within ten (10) days after
exercising such right he shall submit to a physical examination by the Chief of
Medicine of any major hospital in the metropolitan Cleveland, Ohio area, and
(iii) unless such physician shall issue his written statement to the effect that
in his opinion, based on his diagnosis, Wolfort is capable of resuming his
employment and devoting his full time and energy to discharging his duties
within ten (10) days after the date of such statement Olympic shall have the
right to terminate Wolfort under this Section 4.1 without further dispute. Upon
termination under this Section 4.1, Wolfort (or Wolfort's estate or
beneficiaries in the case of the death of Wolfort) shall be entitled to receive
any Annual Salary, Annual Bonus and other benefits earned and accrued under this
Agreement, and reimbursement under this Agreement for expenses incurred, prior
to the date of termination (for these purposes, if such termination occurs
during a fiscal year, the Annual Bonus for such
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fiscal year shall be prorated based upon the number of days in such fiscal year
which elapsed before such termination and shall be paid at the time provided for
in Section 3.4); thereafter, Olympic shall have no further liability to Wolfort.
4.2 CONTINUATION OF BENEFITS. In addition to the benefits payable
under Section 4.1, Wolfort (or his estate in the case of his death) shall be
entitled to one year's annual salary. Further, Wolfort's surviving spouse, if
any, and minor children shall be eligible to continue to participate in
Olympic's health insurance programs, at the expense of Olympic, for twelve (12)
months after the death or disability of Wolfort. After such one-year period,
Wolfort's dependents shall be entitled to participate in any insurance program
of the Company to the extent required by federal or state law. No provision of
this Agreement shall limit any of Wolfort's (or his beneficiaries') rights under
any insurance, pension or other benefit programs of Olympic for which Wolfort
shall be eligible at the time of such death or disability.
5. CERTAIN TERMINATIONS OF EMPLOYMENT.
5.1 TERMINATION FOR CAUSE. "CAUSE" shall be deemed to exist if
Wolfort (i) is convicted of (or pleads nolo contendere to) a felony, a crime of
moral turpitude or any crime involving Olympic (other than pursuant to actions
taken at the direction or with the approval of the Board of Directors) (ii) is
found by reasonable determination of the Board of Directors, made in good faith,
to have engaged in (A) willful misconduct, (B) willful or gross neglect, (C)
fraud, (D) misappropriation or (E) embezzlement in the performance of his duties
hereunder, or (iii) breaches in any material respect the terms and provisions of
this Agreement and fails to cure such breach within ten (10) days
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following written notice from the Company specifying such breach. Olympic may
terminate Wolfort's employment hereunder for Cause on written notice (which
notice shall specify the reasons for such termination) given to Wolfort at any
time following the occurrence of any of the events described in clauses (i)
through (ii) above and or written notice given to the Employee at any time not
less than 30 days following the occurrence of any of the events described in
clause (iii) above. Upon such termination, Wolfort shall be entitled to receive
any Annual Salary, Annual Bonus and other benefits earned and accrued under this
Agreement, and reimbursement under this Agreement for expenses incurred, prior
to the date of such termination (provided that, for these purposes and for all
other purposes of this Agreement, if such termination occurs after the last day
of a fiscal year then the unpaid Annual Bonus (if any) otherwise payable under
Section 3.4) for such fiscal year shall be deemed to have been earned and
accrued, but in no event shall any portion of any other subsequent Annual Bonus
be deemed to have been earned or accrued); thereafter, Olympic shall have no
further liability to Wolfort.
5.2 TERMINATION BY OLYMPIC WITHOUT CAUSE; CERTAIN TERMINATIONS BY
WOLFORT. During the Term, Olympic may terminate Wolfort's employment hereunder
for any reason on at least thirty (30) days' written notice given to Wolfort. If
Olympic so terminates Wolfort during the Term, and such termination is not
described in Section 4 or 5.1, then
(I) the Employee shall be entitled to receive any Annual Salary,
Annual Bonus and other benefits earned and accrued under this
Agreement,
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and reimbursement under this Agreement for expenses incurred,
prior to the date of such termination;
(II) during the period ending on the earlier of (i) the termination
date of this Agreement or (ii) twenty-four (24) months
following such termination, the Employee shall also be
entitled to
(A) continue to receive the Annual Salary payable in the
amounts and at the times provided for in Section 3.1 as if
such employment had not otherwise been so terminated;
(B) continue to receive the Annual Bonus or, if applicable,
Annual Bonuses (if any) payable at the times provided for in
Section 3.4 as if such employment had not otherwise been so
terminated.
(C) continuation of any group life, health and
automobile-related benefits to which Wolfort is otherwise
entitled hereunder on substantially the same terms and
conditions (including with respect to the cost, if any, to
Wolfort, subject to generally applicable changes to the level
(and cost) of coverage that may be made with respect to senior
executives generally; provided that such continuation shall
not be required hereunder to the extent that Wolfort is
entitled (absent any individual waivers or other arrangements)
to receive during such period the same type of coverage from
another employer or recipient of Wolfort's services.
Thereafter, Olympic shall have no further liability to Wolfort.
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6. NON-COMPETITION. During a period ending one (1) year following the
date of Wolfort's termination of employment, Employee shall not take a
management, consultant or other position with (i) any steel service center or
distributor within those portions of the United States wherein the Company is
conducting business on the Termination Date, or (ii) a business engaged in
direct competition with any other significant business carried on by the Company
on the termination date, nor shall he become a principal of or assume control of
a business which so engages in competition on or after the Termination Date;
provided, however, that in no event shall ownership of less than five percent
(5%) of the equity of a corporation, limited liability company or other business
entity, standing alone, be deemed competition with the Company within the
meaning of this paragraph 6.
7. WITHHOLDING. The Company may withhold from any amounts payable
hereunder, all federal, state, city, or other taxes as may be required pursuant
to any applicable law, or government regulation or ruling.
8. CONFIDENTIALITY. (a) During his employment and all periods
thereafter, Wolfort shall keep secret and retain in strictest confidence, and
shall not use for his benefit or the benefit of others, except in connection
with the business and affairs of Olympic and its subsidiaries, all confidential
matters relating to the business of Olympic and its subsidiaries learned by
Wolfort during his employment by Olympic, including, without limitation,
information with respect to (a) sales figures, (b) profit or loss figures, and
(c) customers, clients, suppliers, sources of supply and customer lists (the
"CONFIDENTIAL COMPANY INFORMATION") and shall not disclose the Confidential
Company
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Information to anyone outside of Olympic or its subsidiaries except with
Olympic's express written consent and except for Confidential Company
Information which (1) is at the time of receipt or thereafter becomes publicly
known through no wrongful act of Wolfort, (2) is received from a third party not
under an obligation to keep such information confidential and without breach of
this Agreement or (3) was previously known by Wolfort before being employed by
Olympic.
(b) During the Restricted Period, Wolfort shall not, without
Olympic's prior written consent, directly or indirectly, knowingly solicit or
encourage to leave the employment of Olympic or its subsidiaries, any employee
of Olympic or its subsidiaries or hire any employee who has left the employment
of Olympic or its subsidiaries after the effective date of this Agreement within
one year of the termination of such employee's employment with Olympic and its
subsidiaries.
(c) All memoranda, notes, lists, records and other documents (and
all copies thereof) made or compiled by Wolfort or made available to Wolfort
concerning the business of Olympic and its subsidiaries shall be Olympic's
property and shall be delivered to Olympic at any time on request, provided such
property is then possessed by Wolfort and can be readily identified as such by
him; provided that, notwithstanding the foregoing, Wolfort may retain a copy of
his rolodex.
9. RIGHTS AND REMEDIES UPON BREACH. If Wolfort breaches, or threatens
to commit a breach of, any of the provisions of Sections 6 and/or 8 (the
"RESTRICTIVE COVENANTS"), Olympic and its subsidiaries shall have, in addition
to any and all other rights at law, and equity, the right and remedy to have the
Restrictive Covenants
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specifically enforce (without posting bond) by any court having equity
jurisdiction, including, without limitation, the right to an entry against
Wolfort of restraining orders and injunctions (preliminary, mandatory, temporary
and permanent) against violations, threatened or actual, and whether or not then
continuing, of such covenants, it being acknowledged and agreed that any such
breach or threatened breach will cause irreparable injury to Olympic and that
money damages will not provide an adequate remedy to Olympic.
10. OTHER PROVISIONS.
10.1 SEVERABILITY. Wolfort acknowledges and agrees that (i) he has
had an opportunity to seek advice of counsel in connection with this Agreement
and (ii) the Restrictive Covenants are reasonable in geographical and temporal
scope and in all other respects. If it is determined that any of the provisions
of this Agreement, including, without limitation, any of the Restrictive
Covenants, it any part thereof, is invalid or unenforceable, the remainder of
the provisions of this Agreement shall not thereby be affected and shall be
given full effect, without regard to the invalid portions.
10.2 BLUE-PENCILING. If any court determines that any of the
covenants contained in this Agreement, including, without limitation, any of the
Restrictive Covenants, or any part thereof, is unenforceable because of the
duration or scope of such provision, then, after such determination has become
final and unappealable, the duration or scope of such provision, as the case may
be, shall be reduced so that such provision becomes enforceable and, in its
reduced form, such provision shall then be enforceable and shall be enforced.
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10.3 ENFORCEABILITY; JURISDICTIONS. Olympic and Wolfort intend to
and hereby confer jurisdiction to enforce the Restrictive Covenants upon the
courts of any jurisdiction within the geographical scope of the Restrictive
Covenants. If the courts of any one or more of such jurisdictions hold the
Restrictive Covenants wholly unenforceable by reason of breadth of scope or
otherwise, it is the intention of Olympic and Wolfort that such determination
not bar or in any way affect Olympic's right or the right of its subsidiaries to
the relief provided above in the courts of any other jurisdiction within the
geographical scope of such Restrictive Covenants, as to breaches of such
Restrictive Covenants in such other respective jurisdictions, such Restrictive
Covenants as they relate to each jurisdiction being, for this purpose,
severable, diverse and independent covenants, subject, where appropriate, to the
doctrine of RES JUDICATA.
10.4 NOTICES. Any notice or other communication required or
permitted hereunder shall be in writing and shall be delivered personally,
telegraphed, telexed, sent by facsimile transmission or sent by certified,
registered or express mail, postage prepaid. Any such notice shall be deemed
given when so delivered personally, telegraphed, telexed or sent by facsimile
transmission or, if mailed, five days after the date of deposit in the United
States mails as follows:
(i) If to Olympic, to:
Olympic Steel, Inc.
5096 Richmond Road
Bedford, Ohio 44146
Attention: Chief Executive Officer
With a copy to:
Marc H. Morgenstern, Esq.
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Kahn, Kleinman, Yanowitz & Arnson Co., L.P.A.
The Tower At Erieview
1301 East Ninth Street, Suite 2600
Cleveland, Ohio 44114-1824
(ii) If the Employee to:
David A. Wolfort
70 Ridgecreek Trail
Moreland Hills, Ohio 44022
Any such person may by notice given in accordance with this Section to the other
parties hereto designate another address or person for receipt by such person of
notices hereunder.
10.5 ENTIRE AGREEMENT.This Agreement contains the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior agreements, written or oral, with the exception of the
Management Retention Agreement entered into by and between Olympic and Wolfort
on or about April 20, 2000 which shall remain in full force and effect. In the
event of any conflict between the Agreement and the Management Retention
Agreement, the terms of the Management Retention Agreement shall prevail.
10.6 WAIVERS AND AMENDMENTS. This Agreement may be amended,
superseded, canceled, renewed or extended, and the terms hereof may be waived,
only by a written instrument signed by the parties or, in the case of a waiver,
by the party waiving compliance. No delay on the part of any part 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 such right, power or privilege
nor any single or partial exercise of any such right,
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power or privilege, preclude any other or further exercise thereof or the
exercise of any other such right, power or privilege.
10.7 GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Ohio without regard to
principles of conflicts of law.
10.8 ASSIGNMENT. This Agreement, and Wolfort's rights and
obligations hereunder, may not be assigned by Wolfort; any purported assignment
by Wolfort in violation hereof shall be null and void. In the event of any sale,
transfer or other disposition of all or substantially all of Olympic's assets or
business, whether by merger, consolidation or otherwise, Olympic may assign this
Agreement and its rights hereunder.
10.9 BINDING EFFECT. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors, permitted
assigns, heirs, executors and legal representatives.
10.10 COUNTERPARTS. This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original but all such counterparts together shall
constitute one and the same instrument. Each counterpart may consist of two
copies hereof each signed by one of the parties hereto.
10.11 HEADINGS. The headings in this Agreement are for
reference only and shall not affect the interpretation of this Agreement.
IN WITNESS WHEREOF, the parties hereto have signed their names on the
_____ day of ______________, 2001.
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OLYMPIC STEEL, INC.
By: _________________________________
Michael D. Siegal
Its Chief Executive Officer
_____________________________________
David A. Wolfort
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