Date of Report (Date of earliest event reported)
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January 17, 2012
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L. B. Foster Company
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(Exact name of registrant as specified in its charter)
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Pennsylvania
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000-10436
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25-1324733
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(State or other jurisdiction of incorporation)
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(CommissionFile Number)
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(I.R.S. EmployerIdentification No.)
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415 Holiday Drive, Pittsburgh, Pennsylvania
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15220
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number, including area code
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(412) 928-3417
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(Former name or former address, if changed since last report.)
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
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[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Exhibit Number
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Description
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3.1
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Bylaw Amendment (filed herewith)
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10.1
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Employment Agreement (filed herewith)
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10.2
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Letter Agreement with Stan Hasselbusch (filed herewith)
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99.1
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Press Release (filed herewith)
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a.
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Position. The Employee will serve as the President and Chief Executive Officer and shall report to the Board.
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b.
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Responsibilities. The Employee will have obligations, duties, authority and power to do such acts as are customarily done by a person holding the same or equivalent positions in corporations of similar size to the Company. The Employee shall perform such managerial duties and responsibilities for the Company as may reasonably be assigned to him by the Board commensurate with his position and, at no additional compensation, shall serve on the Board and in other such positions with any subsidiary corporation of the Company, or any partnership, limited liability company or other entity in which the Company has an interest (herein collectively called “Affiliates”), as the Board may from time to time determine. The Employee agrees to tender his resignation as an employee from all positions held with the Company or with any of the Affiliates immediately upon termination of Employee's employment by the Company for any reason whatsoever. Unless otherwise agreed to by the parties hereto, the Employee agrees to tender his resignation from the Board and the board of directors of any of the Affiliates immediately upon termination of Employee’s employment by the Company for any reason whatsoever.
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c.
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Dedication of Professional Services. The Employee shall devote substantially all of his business time, best efforts and attention to promote and advance the business of the Company and its Affiliates to perform diligently and faithfully all the duties, responsibilities and obligations of his positions with the Company and its Affiliates. The Employee shall not be employed in any other business activity, other than with the Company and its Affiliates, during the Term, whether or not such activity is pursued for gain, profit or other pecuniary advantage, without prior approval by the Compensation Committee of the Board (the “Compensation Committee”); provided, however, that this restriction will not be construed as preventing the Employee from (i) serving as a member of one (1) outside public company Board of Directors, subject to prior approval by the Compensation Committee, and (ii) investing his personal assets in a business which does not compete with the Company or its Affiliates, where the form or manner of such investment will not require services of any significance on the part of the Employee in the operation of the affairs of the business in which such investment is made and in which his participation is solely that of a passive investor.
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d.
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Adherence to Standards. The Employee shall comply with the written policies, standards, rules and regulations of the Company from time to time established for the executive officers of the Company consistent with the Employee’s positions and level of authority.
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e.
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Minimum Stock Ownership. The Employee shall comply with the minimum stock ownership requirements for the President and Chief Executive Officer of the Company pursuant to Company policy.
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a.
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Base Salary. The Company shall pay the Employee an annual base salary of $575,000.00 (the “Base Salary”) during the Term of this Agreement. The Base Salary will be payable in accordance with the ordinary payroll practices of the Company. The Compensation Committee shall review the Base Salary annually, and the Base Salary may be changed by the Compensation Committee in its sole discretion, taking into account the base salaries, aggregate annual cash compensation and other compensation of individuals holding similar positions at other comparable companies and the performance of the Employee and the Company.
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b.
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Annual Incentive Plan. The Employee shall be eligible to participate in the Company's annual incentive plan (the “AIP”) during the Term in accordance with the terms of the AIP. For 2012, the bonus target under the AIP will be seventy-five percent (75%) of the Base Salary with the ability to earn between zero percent (0%) and one hundred fifty percent (150%) of Base Salary based on the achievement of established criteria, which criteria will be established by the Compensation Committee for the Company’s other senior executive officers for 2012; provided that achievement of such criteria will be determined by such Committee in its sole discretion.
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c.
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Signing Award. The Employee will receive a restricted stock award (the “Restricted Stock Award”) under the Company's 2006 Omnibus Incentive Plan (the “Plan”) for 66,000 shares of the Company’s common stock on the Effective Date. Such Restricted Stock Award shall be in the form approved by the Compensation Committee. The Restricted Stock Award shall vest as follows: 16,500 shares on February 1, 2013, 16,500 shares on February 1, 2014, 16,500 shares on February 1, 2015 and 16,500 shares on February 1, 2016, subject to (i) the Employee's continued employment with the Company and/or service as a member of the Board, (ii) compliance with Section 6 of this Agreement through such vesting date, (iii) the terms of the related award agreement and (iv) the terms of the Plan.
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d.
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Participation in Long-Term Equity Compensation Plan. As a long term incentive, under the Company’s long-term incentive plan, the Employee, beginning in 2012, shall participate in the Company's long term incentive plan on the same terms as provided to the other senior executive officers based on criteria established by the Compensation Committee in its sole discretion each year as part of the annual compensation resolution; provided that for the year 2012 Employee shall be entitled to participate as if employed on January 1, 2012 in accordance with the terms of the long-term incentive plan.
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e.
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Other Compensation. The Employee will be eligible to participate in all other cash or stock compensation plans or programs and perquisites maintained by the Company, as in effect from time to time, in which, the Board or Compensation Committee determines, the senior executive officers of the Company are allowed to participate, including, but not limited to, the Company’s SERP.
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f.
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Change in Control. The Employee shall participate in the L. B. Foster Company Key Employee Separation Plan, effective as of December 9, 2008, as such plan is amended from time to time.
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g.
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Recoupment of Certain Compensation. If the Company has to restate all or a portion of its financial statements due to the material noncompliance of the Company with any financial reporting requirement under the securities laws, the Employee shall, for the affected years, reimburse the Company for any excess bonus paid to the Employee pursuant to Section 4.b. The reimbursements shall be equal to the difference between the bonus paid to him for the affected years and the bonus that would have been paid to the Employee had the financial results been properly reported. Such reimbursement shall be paid to the Company within ninety (90) days after the Company notifies the Employee of the amount owed to the Company. Employee also agrees that Employee is bound by the provisions of any recoupment or “clawback” policy that the Company adopts after the date hereof that is applicable to the Company’s executive officers or is otherwise required under applicable law, including the Dodd-Frank Act.
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a.
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Relocation. Company will provide Employee with a relocation package consistent with packages provided previously by the Company to other employees, which shall include generally the relocation of personal effects, visits to search for a new home, temporary living expenses, transportation fees, realtor fees and real estate closing costs.
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b.
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Participation in Company Benefit Plans. During the Term, the Company shall provide the Employee with coverage under all employee welfare benefit programs, plans and practices commensurate with his positions in the Company and its Affiliates and to the extent permitted under the respective employee benefit plan.
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c.
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Expense Reimbursement. The Employee is authorized to incur reasonable expenses, consistent with Company policies, in carrying out his duties and responsibilities under this Agreement, including, without limitation, expenses related to travel, meals, entertaining and similar items related to such duties and responsibilities. The Company shall reimburse the Employee for all such expenses on presentation by the Employee from time to time of appropriately itemized and approved (consistent with the Company’s policies) accounts of such expenditures. The Company shall reimburse the Employee for reasonable dues and expenses of membership in such club or clubs as the Board reasonably deems necessary for the Employee to entertain on behalf of the Company and for costs associated with continuing education and professional dues. All expense reimbursements for a calendar year will be paid in the normal course, but no later than March 15 of the following calendar year in which the expense was incurred.
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d.
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Health Insurance. The Company agrees that it will include the Employee under any hospital, surgical or group health plan or policy adopted generally for the benefit of its employees. The payment of the premiums for the Employee and his dependents will be determined in accordance with the rules and regulations adopted by the Company for its employees.
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e.
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Automobile. During the Term, the Employee will be entitled to payment of a car allowance in accordance with a policy approved by the Board or its designee, such allowance to initially be $850 per month.
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a.
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Notice of Termination; Automatic Termination. Either the Employee or the Board may terminate this Agreement at any time and in his or its sole discretion upon written Notice of Termination to the other party. “Notice of Termination” means a written notice which shall indicate the specified termination provision in this Agreement relied upon (pursuant to Section 7.c, Section 7.d, Section 7.e, Section 7.f, Section 7.g or Section 7.h) and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Employee’s employment under the provision so indicated; provided, however, that no such purported termination will be effective without such Notice of Termination; provided further, however, that any purported termination by the Company or by the Employee must be communicated by a Notice of Termination to the other party hereto in accordance with Section 9 (“Notices”) of this Agreement. Termination of this Agreement on the Ending Date in accordance with Section 1.a shall not entitle the Employee to receive any of the severance benefits described in this Section 7. All payments to Employee under this Agreement are subject to all applicable tax withholding requirements.
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b.
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Termination Date. The “Termination Date” shall mean the date specified in a Notice of Termination. Except as provided in Section 7.e with respect to death and Disability, the Termination Date shall not be less than thirty (30) days after the date such Notice of Termination is given; provided that the Company, in its sole discretion, (i) may immediately (or any time after the date of the Notice of Termination) choose to relieve the Employee of all of his responsibilities to the Company from the date of the Notice of Termination through the Termination Date and (ii) continue to pay the Employee the compensation and benefits earned by such Employee under Sections 4 and 5 through the Termination Date.
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c.
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Termination by the Company for Just Cause.
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(i)
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The Company may terminate the Employee for “Just Cause” (as defined in Section 7.c(ii)), provided that the Company shall:
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(A)
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Give the Employee Notice of Termination as specified in Section 7.a, and
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(B)
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Pay to the Employee, within forty (40) days after his Termination Date (or earlier if a payment is required to be made prior to such forty (40) day period), his Base Salary through the Termination Date and pay or provide to Employee any other payments or benefits which have been earned and remain vested and payable as of the Termination Date pursuant to the terms of this or any other agreement or any compensation or benefit plan but which have not yet been paid or provided.
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(ii)
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For purposes of this Agreement “Just Cause” means a good faith determination of the Board that:
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(A)
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The Employee’s conduct, by act or omission, constitutes gross negligence or willful misconduct in the performance of the material duties and services required of the Employee;
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(B)
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The Employee has been convicted of, or has entered a plea of guilty or nolo contendere to, a felony, or Employee has engaged in fraudulent or criminal activity relating to the scope of Employee’s employment (whether or not prosecuted);
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(C)
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The Employee’s conduct, by act or omission, constitutes a material violation of the Company's Legal and Ethical Conduct Policy, as amended from time to time;
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(D)
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The Employee’s conduct, by act or omission, constitutes a continuing or repeated failure to perform the material duties as requested in writing by the Board after the Employee has been afforded a reasonable opportunity (not to exceed 30 days) to cure such breach;
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(E)
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The Employee has committed a felony or significant crime involving moral turpitude; or
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(F)
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The Employee’s conduct constitutes a foreseeable risk that the Company and/or its Affiliates may be brought into public disgrace or disrepute in any material respect.
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d.
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Termination by the Company Without Just Cause. If the Company terminates this Agreement prior to the Ending Date for any reason other than for Just Cause or the death or Disability (as defined in Section 7.e) of the Employee, the Company shall:
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(i)
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Pay to the Employee, within forty (40) days after the Termination Date (or earlier if a payment is required to be made prior to such forty (40) day period), a lump sum severance payment equal to the lesser of (a) the amount of the then Base Salary remaining to be paid to Employee from the Termination Date until the Ending Date plus a pro-rata portion of the target payout under the AIP and (b) two (2) times the then Base Salary plus two (2) times the target payout under the AIP;
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(ii)
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Pay to the Employee any unpaid expense reimbursement upon presentation by the Employee of an accounting of such expenses in accordance with normal Company policies and practices, but no later than March 15 of the year following the year of termination; and
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(iii)
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Make any other payments or provide any benefits earned under this or any other employment agreement or plan, including the Company’s long-term incentive plan.
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e.
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Termination in the Event of Death or Disability.
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(i)
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This Agreement will be terminated by the Company in the event of the death of the Employee upon proper notification to his estate. The Company shall pay to the estate of the Employee the Base Salary described in Section 4.a of this Agreement which had been earned through the Termination Date and any amounts earned under Section 4.b of this Agreement prorated for the period up to the Termination Date.
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(ii)
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This Agreement may be terminated by the Company in the event of the Disability (as hereinafter defined) of the Employee upon proper notification to the Employee. The Company shall pay to the Employee the Base Salary described in Section 4.a of this Agreement which had been earned through the Termination Date and any amounts earned under Section 4.b of this Agreement prorated for the period up to the Termination Date. “Disability” shall mean the Employee’s physical or mental incapacity, with reasonable accommodation, to perform his usual duties with such condition likely to remain continuously and permanently as determined by the Company.
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(iii)
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All amounts that are payable under this Section 7.e in the form of a lump sum shall be paid as soon as practicable, but no later than two and one-half (2-1/2) months following the close of the calendar year in which the death or Disability occurred.
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f.
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Termination by the Employee for Good Reason.
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(i)
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If the Employee terminates this Agreement for Good Reason (as defined in Section 7.f(ii)), the Company shall:
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(A)
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Pay to the Employee, within forty (40) days after the Termination Date (or earlier if a payment is required to be made prior to such forty (40) day period), a lump sum severance payment equal to the lesser of (a) the amount of the then Base Salary remaining to be paid to Employee from the Termination Date until the Ending Date plus a pro-rata portion of the target payout under the AIP and (b) two (2) times the then Base Salary plus two (2) times the target payout under the AIP;
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(B)
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Pay to the Employee any unpaid expense reimbursement upon presentation by the Employee of an accounting of such expenses in accordance with normal Company policies and practices, but no later than March 15 of the year following the year of termination; and
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(C)
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Make any other payments or provide any benefits earned under this or any other employment agreement or plan, including the Company’s long-term incentive plan.
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(ii)
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“Good Reason” means the occurrence of any of the following events without the Employee's prior express written consent:
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(A)
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A material reduction in the Employee’s annual Base Salary (unless such reduction relates to an across-the-board reduction similarly affecting Employee and all or substantially all other executive officers of the Company and its Affiliates);
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(B)
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The Company makes or causes to be made a material adverse change in the Employee’s position, authority, duties or responsibilities which results in a significant diminution in the Employee’s position, authority, duties or responsibilities, excluding any change made in connection with a termination of Employee’s employment with the Company for Disability, Just Cause, death, or temporarily as a result of Employee’s incapacity or other absence for an extended period;
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(C)
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A relocation of the Company's principal place of business, or of Employee’s own office as assigned to Employee by the Company to a location that increases Employee’s normal work commute by more than 50 miles; or
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(D)
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Any other action by the Company that constitutes a material breach of this Agreement.
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(iii)
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In order for Employee to terminate for Good Reason, (a) the Company must be notified by the Employee in writing within 90 days of the event constituting Good Reason, (b) the event must remain uncorrected by the Company for 30 days following such notice (the “Notice Period”), and (c) such termination must occur within 60 days after the expiration of the Notice Period.
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g.
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Termination by the Employee for other than Good Reason. The Employee may terminate this Agreement for other than Good Reason upon proper notification as provided in Section 7.a. In such event, the Company shall pay to the Employee within forty (40) days after his Termination Date (or earlier if a payment if required to be made prior to such forty (40) day period), his Base Salary through the Termination Date and pay or provide to Employee any other payments or benefits which have been earned and remain vested and payable as of the Termination Date pursuant to the terms of this or any other agreement or any compensation or benefit plan but which have not yet been paid or provided;
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h.
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Termination in connection with a Change of Control. Notwithstanding Sections 7(c) through 7(g) above, in the event of a Covered Change in Control Termination (as such term is defined in the Key Employee Separation Plan), the compensation and benefits to which Employee shall be entitled shall be governed by the Key Employee Separation Plan rather than those provisions set forth in Sections 7(c) through 7(g) above.
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i.
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Release. As a condition to the payment by the Company of the amounts due under subsections (d) or (f) above that have not otherwise been earned as of the Termination Date and would not have otherwise been due absent such termination, the Employee shall execute the release in substantially the form attached hereto as Exhibit A within twenty-one (21) days following the Termination Date and shall not revoke it within the seven (7) day revocation period.
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The Company at:
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L. B. Foster Company
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Attention: Vice President, Human Resources
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415 Holiday Drive
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Pittsburgh, PA 15220
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The Employee at:
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Robert Bauer
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6129 Grey Friar Way
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Dublin, OH 43017
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a.
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The provisions of this Agreement will be administered, interpreted and construed in a manner intended to comply with Section 409A, the regulations issued thereunder, or any exception thereto (or disregarded to the extent such provision cannot be so administered, interpreted, or construed).
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b.
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For purposes of Section 409A, each severance payment, including each individual installment payment, shall be treated as a separate payment. Each payment under this Agreement is intended to be excepted from Section 409A to the maximum extent provided under Section 409A as follows: (i) each payment made within the applicable 2½ month period specified in Treas. Reg. § 1.409A-1(b)(4) is intended to be excepted under the short-term deferral exception as specified in Treas. Reg. § 1.409A-1(b)(4); (ii) post-termination medical benefits are intended to be excepted under the medical benefits exceptions as specified in Treas. Reg. §ÿ1.409A-1(b)(9)(v)(B); and (iii) to the extent payments are made as a result of an involuntary separation, each payment that is not otherwise excepted under the short-term deferral exception or medical benefits exception is intended to be excepted under the involuntary pay exception as specified in Treas. Reg. § 1.409A-1(b)(9)(iii).
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c.
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Notwithstanding anything in this Agreement to the contrary, for purposes of this Agreement, the Employee will be considered to have experienced a termination of employment only if the Employee has a “separation from service” within the meaning of Treas. Reg. § 1.409A-1(h) or any successor thereto. In addition, if a payment or benefit is considered to be deferred compensation subject to Code Section 409A and the Employee is deemed to be a “specified employee” within the meaning of that term under Code Section 409A(a)(2)(B), then with regard to any payment or the provisions of any benefit that is required to be delayed pursuant to Code Section 409A(a)(2)(B), such payment or benefit shall not be made or provided prior to the earlier of (i) the expiration of the six (6) month period measured from the date of the Employee’s “separation from service” (as such term is defined in Treas. Reg. § 1.409A-1(h)), or (ii) the date of the Employee’s death (the “Delay Period”). Within ten (10) days following the expiration of the Delay Period, all payments and benefits delayed pursuant to this Section (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed to the Employee in a lump sum, and any remaining payments and benefits, if any, due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.
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d.
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Except as otherwise expressly provided herein, to the extent any expense reimbursement or other in-kind benefit is determined to be subject to Code Section 409A, the amount of any such expenses eligible for reimbursement or in-kind benefits in one calendar year shall not affect the expenses eligible for reimbursement or in-kind benefits in any other taxable year, in no event shall any expenses be reimbursed or in-kind benefits be provided after the last day of the calendar year following the calendar year in which the Employee incurred such expenses or received such benefits, and in no event shall any right to reimbursement or in-kind benefits be subject to liquidation or exchange for another benefit.
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e.
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Notwithstanding anything herein to the contrary, in no event shall the Company (or its employees, officers, directors, members or Affiliates) have any liability to the Employee (or any other person) due to the failure of this Agreement (or any payment hereunder) to satisfy the requirements of Section 409A.
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·
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Title VII of the Civil Rights Act of 1964, as amended;
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·
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The Civil Rights Act of 1991;
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·
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Sections 1981 through 1988 of Title 42 of the United States Code, as amended;
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·
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The Employee Retirement Income Security Act of 1974, as amended;
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·
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The Americans with Disabilities Act of 1990, as amended;
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·
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The Age Discrimination in Employment Act of 1967, as amended;
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·
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The Older Workers Benefit Protection Act;
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·
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The National Labor Relations Act;
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·
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The Family Medical Leave Act, as amended;
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·
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The Genetic Information Nondiscrimination Act;
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·
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Pennsylvania Human Relations Act;
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·
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Pennsylvania Wage Payment and Collection Law;
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·
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The Occupational Safety and Health Act, as amended;
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·
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Any other federal, state or local civil or human rights law or any other local, state
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·
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Any allegation for costs, fees, or other expenses including attorneys' fees incurred in these matters (all of the above collectively referred to as "Claims").
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Name:___________________________
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Title: ____________________________
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