{"id":39669,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/employment-agreement-union-pacific-railroad-co-and-robert.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"employment-agreement-union-pacific-railroad-co-and-robert","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/employment-agreement-union-pacific-railroad-co-and-robert.html","title":{"rendered":"Employment Agreement &#8211; Union Pacific Railroad Co. and Robert Starzel"},"content":{"rendered":"<pre>\n                              September 11, 1996\n\n\nPersonal &amp; Confidential\n\n\nMr. Robert Starzel\nVice Chairman\nSouthern Pacific Rail Corporation\nOne Market Plaza, 8th Floor\nSan Francisco, CA 94105\n\nDear Bob:\n\nWe are pleased that commencing with the merger (the 'Merger') of Southern\nPacific Rail Corporation ('SP Rail') into a subsidiary of Union Pacific\nCorporation, currently expected to occur on September 11, 1996, you will\ncontinue in the employment of Union Pacific Railroad Company ('UPRR') and its\naffiliates as Vice President, Western Region, based in San Francisco, CA.\n\n     You will receive an annual base salary of $350,000 (less applicable taxes\nand withholding) and, after January, 1997, will participate in the Executive\nIncentive Plan of Union Pacific Corporation and Subsidiaries with a 1997 bonus\nguaranteed in the amount of $200,000 (less applicable taxes and withholding) if\nemployed by UPRR on December 31, 1997. Union Pacific Corporation's officers will\nrecommend to the Compensation, Benefits and Nominating Committee of Union\nPacific Corporation's Board (the 'Committee') during the 1996 fall compensation\ncycle that you receive 10,000 Union Pacific Corporation Retention Shares,\nsubject to the terms and conditions of Union Pacific Corporation's 1993 Stock\nOption and Retention Stock Plan (the 'Plan') and further subject to the number\nbeing adjusted following Resources' Spin-Off in the same manner as other\noutstanding Retention Shares under the Plan.  These shares will vest three years\nfrom grant date, or, if earlier, upon your death or upon disability under the\nprovisions of UPRR's long-term disability plan as in effect from time to time.\nIf prior to vesting, your working relationship with UPRR changes in a mutually\nagreed upon manner, UPRR may recommend early vesting to the Committee as\npermitted by the Plan; however, your Retention Shares shall be forfeited\nautomatically in the event you receive the $700,000 severance payment referred\nto in the second following paragraph.  Dividends will be held in escrow and\npaid, net of applicable taxes and withholding, upon vesting.  Upon the effective\ndate of the Merger (as defined below), you will be entitled to the balance of\nthe Management Continuity Payment described in the Merger Agreement.\n\n     The terms set forth in the letter agreement, dated October 26, 1994,\nbetween you and SP Rail, as amended (the 'SP Employment Agreement') with respect\nto the remaining outstanding amount of the loan extended to you by SP Rail to\n \npurchase a residence in San Francisco will continue to apply, with Union Pacific\nRailroad Company ('UPRR') as the obligee of the loan and the employer.\n\n     You will receive $350,000 (less applicable taxes and withholding) upon the\neffective date of this agreement.  In lieu of the severance provisions set forth\nin the SP Employment Agreement and the Enhanced Severance Program described in\nthe Amended and Restated Agreement and Plan of Merger by and among Union Pacific\nCorporation, UPRR, SP Rail, UP Holding Company, Inc. and Union Pacific Merger\nCo., dated as of July 12, 1996 (the 'Merger Agreement'), you will be entitled to\nthe following: (1) if, prior to September 11, 1998, your employment with UPRR\nterminates, other than for 'cause' as defined in the Employment Agreement, you\nwill be entitled to a severance payment of $700,000 less applicable taxes and\nother withholdings reduced by any bonuses received prior to such termination,\nand (2) if your employment with UPRR terminates for 'cause' at any time, or your\nemployment with UPRR terminates for any reason on or after September 11, 1998,\nyou will not be entitled to any severance payment.  In no event will you be\nentitled to receive any severance payment if your Retention Shares referred to\nabove have vested.\n\n     If the compensation outlined in this agreement or previously paid by SP\nRail results in your being subject to IRS Excise Tax, Union Pacific Corporation\nwill reimburse you for or pay on your behalf the 20% Excise Tax and related Tax\nGross-up on such items, upon the terms and conditions described in Annex A.\n\n     As of January 1, 1998, your Southern Pacific service will be combined with\nyour continued Union Pacific service toward vesting and credited service in\nUnion Pacific Corporation's pension plans as in effect from time to time,\nsubject to any offset with respect to accrued benefits under the Southern\nPacific pension plan.  Union Pacific will also continue to honor the terms of\nyour supplemental pension as provided for in the SP Employment Agreement.  Prior\nto January 1, 1998, you will continue to be covered by the Southern Pacific\npension plan and your supplemental pension.\n\n     While you are employed by UPRR you will devote your full energies, efforts\nand productive time exclusively to the business and affairs of UPRR, and you\nwill do your utmost to promote its interest.  You will not, without UPRR's prior\nconsent, render to others services of any kind for compensation, and you will\nnot engage in any other business activity that would interfere with the\nperformance of your duties for UPRR.\n\n     In the event that your employment with UPRR is terminated by UPRR for any\nreason, you agree that, for a period of one year, commencing on the date of such\ntermination, without the approval of the Chief Executive Officer of Union\nPacific Corporation, you will not compete (as a proprietor, partner,\nshareholder, director, employee, agent, consultant, or in any other capacity of\nmanner) with UPRR's railroad, fiber optic or real estate businesses or with\nother material businesses of UPRR or its affiliated companies with which you\nwere involved at any time (including prior to the date of this Agreement), in\nthe geographical areas where such businesses are conducted on the date of such\ntermination, unless neither UPRR nor any of its affiliated companies is involved\nin such business on the date of such termination, except that the foregoing\nshall not apply to ownership by you of a 5% or less equity interest in a\npublicly-traded entity if \n \n\nyou have no other interest in or involvement with such entity. UPRR and you\nintend that the provisions of this paragraph be enforceable to the fullest\nextent permitted by law and public policy applied in each jurisdiction where\nenforcement is sought. If a particular portion of this paragraph shall be\nadjudicated to be unenforceable, such adjudication shall apply only with respect\nto your activities in the particular jurisdiction in which such adjudication is\nmade. In addition, you agree that you will not, while you are employed by UPRR\nor at any time prior to the end of the first year after your employment with\nUPRR has terminated, without the approval of the Chief Executive Officer of\nUnion Pacific Corporation, solicit the employment of any person, who, at the\ntime of such solicitation, is an employee of UPRR or any of its affiliates.\n\n     You acknowledge that as an employee of UPRR, you will have access to\nproprietary and Confidential Information that directly or indirectly relates to\nthe business of UPRR and its affiliates.  For purposes of this Agreement,\n'Confidential Information' means all information about UPRR and its affiliates\nobtained or developed by you while an employee of SP Rail or UPRR including, but\nnot limited to, information regarding the officers and other key personnel of\nUPRR and its affiliates and financial or business information, strategy or\nplans, which UPRR or one of its affiliates has requested be held in confidence\nor could reasonably be expected to desire to be held in confidence, or the\ndisclosure of which would likely be disparaging or damaging, to any extent, to\nUPRR or one of its affiliates or any of their employees and directors, but shall\nnot include information already in the public domain. You agree that you will\nnot, without the prior written consent of UPRR or except pursuant to lawful\nprocess, disclose to any person any Confidential Information or use Confidential\nInformation in any way detrimental to UPRR or its affiliates. For purposes of\nthis paragraph, affiliates of UPRR include SP Rail.\n\n     You agree that money damages may not be adequate to compensate UPRR and its\naffiliates for your breach of the immediately preceding three paragraphs and\nthat UPRR will be entitled to a decree for specific performance or other\nappropriate remedy to enforce your performance under such paragraphs.\n\n     None of the foregoing provisions is intended to give you any right to\ncontinued employment with UPRR or its affiliates, and UPRR may terminate your\nemployment at any time, with or without cause or notice, subject only to payment\nof amounts provided above for certain terminations.  You acknowledge that this\nAgreement contains the entire agreement between you and UPRR concerning the\nterms of your employment.\n\n     Except as specifically provided in this Agreement, the SP Employment\nAgreement is hereby terminated and neither SP Rail or UPRR or any of its\nsubsidiaries or affiliates will have any obligation thereunder.\n\n     This agreement will be governed by the laws of the State of Utah.\n\n     This agreement is subject to approval by the Board of Directors of Union\nPacific Corporation.\n \n     If you are in agreement with the terms and conditions of employment\ncontained herein, please execute this Agreement by signing a copy and returning\nit to the undersigned.\n\n                              Sincerely,\n\n                              UNION PACIFIC CORPORATION\n\n                                \/s\/ Richard K. Davidson\n                              ------------------------------------\n                              By:    Richard K. Davidson\n                                     President and Chief Operating \n                                     Officer\n\n\nAgreed to this 11th day of September, 1996.\n\n\n \/s\/ Robert Starzel\n-----------------------------\n      Robert Starzel\n \n                                                                         Annex A\n\n\nDear Mr. Starzel:\n\n     RE:  PAYMENT OF CERTAIN TAXES AND RELATED AMOUNTS\n          --------------------------------------------\n\nPursuant to the provisions of the Amended and Restated Agreement and Plan of\nMerger dated as of July 12, 1996, by and among Union Pacific Corporation\n('UPC'), Union Pacific Railroad Company ('UPRR'), Southern Pacific Rail\nCorporation ('SPRC'), UP Holding Company, Inc. and Union Pacific Merger Co. (the\n'Amended Merger Agreement'), SPRC is to be merged with a subsidiary of Union\nPacific Corporation (the 'Merger').  As of the date hereof, you have entered\ninto an employment agreement (the 'Employment Agreement') with UPC concerning\nyour continued employment with UPRR and its affiliates.  In connection with the\nMerger, and in certain instances your termination of employment from UPRR, you\nmay become entitled to certain compensation from UPC or one or more of its\naffiliates (collectively the 'Company').\n\n     In consideration of your prior services to SPRC and the Company, and the\nundertakings and agreements contained herein, the Company hereby agrees, subject\nto the consummation of the Merger and to the extent set forth in this Agreement\nand in the Employment Agreement, including the limitations and conditions set\nforth in the fifth paragraph of the Employment Agreement, to indemnify and\nprotect you against any excise tax pursuant to Section 4999 of the Internal\nRevenue Code of 1986, as amended (the 'Code') and potential interest or\npenalties that could be associated with that tax incurred in connection with the\ntransactions contemplated by the Amended Merger Agreement, including but not\nlimited to the Merger.\n\n     In the event it shall be determined that any compensation, payment or\ndistribution, made on account of a change in the ownership or effective control\nof SPRC, within the meaning of Section 280G of the Code (a 'Change of Control'),\nby SPRC or one or more of its subsidiaries or affiliates or by the Company to\nyou or for your benefit (determined without regard to any additional payments\nrequired under this Agreement) (each a 'Payment') would be subject to the excise\ntax imposed by Section 4999 of the Code, or any interest or penalties are\nincurred by you with respect to such excise tax (such excise tax, together with\nany such interest and penalties, are hereinafter collectively referred to as the\n'Excise Tax'), then you shall be entitled to an additional payment (a 'Gross-Up\nPayment') in an amount representing the Company's good faith estimate of the\namount necessary to compensate you on an after-tax basis for the Excise Tax, but\nonly in the event that you are entitled to such Gross-Up Payment pursuant to the\nterms of the fifth paragraph of the Employment Agreement.\n\n     The Gross-Up Payment will be made on your behalf within a reasonable period\nof time prior to the date that the obligation to remit the applicable Excise Tax\nis due.  However, as a result of the uncertainty in the application of Section\n4999 of the Code at the time of the initial determination, it is possible that\ncertain payments (the 'Underpayment') that have not been made by the Company\nshould have been made to compensate you on an after-tax basis for the Excise\nTax; provided, however that the Underpayment shall not include any costs,\n \nexpenses, taxes, penalties or other liabilities (a) incurred as a result of your\nfailure to timely remit taxes (other than the Excise Tax, except as otherwise\nprovided in clause (b)) otherwise due by you or with respect to you, (b)\nincurred as a result of your failure to timely remit to the Internal Revenue\nService or any other taxing authority any amounts of Excise Tax that were paid\nto you by the Company, or (c) resulting from your negligence or failure to\ncomply with the terms of this Agreement.  In the event that the Company exhausts\nits remedies pursuant to the immediately following paragraphs, and you\nthereafter are required to make a payment of any Excise Tax, any such\nUnderpayment shall be paid by the Company to or for your benefit within a\nreasonable period of time following such time as the obligation to make such\nUnderpayment is finally resolved.\n\n     You shall notify the Company in writing of any claim by the Internal\nRevenue Service that, if successful, would require the payment by the Company of\nany Underpayment.  Such notification shall be given by you in a timely fashion,\nbut in no event later than ten business days after you are informed in writing\nof such claim and shall apprise the Company of the nature of such claim and the\ndate on which such claim is requested to be paid.  Notwithstanding any other\nprovision in this Agreement to the contrary, if you fail to timely notify the\nCompany of any Underpayment or claim relating thereto, the Company shall not be\nobligated to pay any costs, expenses, taxes or penalties associated therewith.\nIf the Company notifies you within 30 days following receipt of notice from you,\nin writing, that it desires to contest such claim, you shall:\n\n               (i)   give the Company any and all information reasonably\n     requested by the Company relating to such claim,\n\n               (ii)  take any and all such actions in connection with contesting\n     such claim as the Company shall reasonably request in writing from time to\n     time, including, without limitation, accepting legal representation with\n     respect to such claim by an attorney reasonably selected by the Company,\n\n               (iii) cooperate with the Company in good faith in order\n     effectively to contest such claim, and\n\n               (iv)  permit the Company to participate in any proceedings\n     relating to such claim;\n\nprovided, however, that the Company shall bear and pay directly all costs and\nexpenses (including additional interest and penalties) incurred by you in\nconnection with such contest and shall indemnify and hold you harmless, on an\nafter-tax basis, for any Excise Tax or income tax (including interest and\npenalties with respect thereto) imposed as a result of such representation and\npayment of costs and expenses.  Without limitation on the foregoing provisions\nof this Agreement, the Company shall control all proceedings taken in connection\nwith such contest and, at its sole option, may pursue or forego any and all\nadministrative appeals, proceedings, hearings and conferences with the taxing\nauthority in respect of such claim and may, at its sole option, either direct\nyou to pay the tax claimed and sue for a refund or to contest the claim in any\npermissible manner, and you agree to prosecute such contest to a determination\nbefore any administrative tribunal, in a court of initial jurisdiction and in\none or more appellate courts, as the Company may determine; provided further,\nhowever, that if the Company directs you to pay such claim and sue for a refund,\nthe Company shall advance the amount of such payment to you, on an interest-free\n \nbasis and shall indemnify and hold you harmless, on an after-tax basis, from any\nExcise Tax or income tax (including interest or penalties with respect thereto)\nimposed with respect to such advance or with respect to any imputed income with\nrespect to such advance; and further provided that any extension of the statute\nof limitations relating to payment of taxes for your taxable year with respect\nto which such contested amount is claimed to be due is limited solely to such\ncontested amount.  Furthermore, the Company's control of the contest shall be\nlimited to issues with respect to which the Gross-Up Payment or Underpayment\nwould be payable hereunder and you shall be entitled, at your own cost and\nexpense, to settle or contest, as the case may be, any other issue raised by the\nInternal Revenue Service or any other taxing authority.\n\n     If (a) after your receipt of an amount advanced by the Company hereunder,\nyou, for any reason, become entitled to receive any refund with respect to such\nclaim or amount, or (b) if any amount paid to you or on your behalf pursuant to\nthis Agreement exceeds the amount finally determined to compensate you on an\nafter-tax basis for the Excise Tax, taking into account the limitations on such\ncompensation described in this Agreement, then you shall promptly pay to the\nCompany the amount of such refund or excess (together with any interest or\npenalties paid or credited thereon after taxes applicable thereto).\n\n     You and the Company shall each cooperate with the other in connection with\nany administrative or judicial proceedings concerning the foregoing provisions\nof this Agreement, and you agree to timely furnish the Company with all\ndocumentation that the Company may reasonably request, including income tax\nreturns and all schedules thereto.\n\n     The provisions of this Agreement and the indemnities contained herein shall\ncontinue for so long as may be necessary in order to fully protect you against\nany Excise Tax with respect to the Payments.  The provisions of this Agreement\nmay only be modified through a written instrument signed by you and the Company.\nThis Agreement shall be binding upon you and the Company and its successors,\nassigns and transferees.  This Agreement shall be governed by and construed in\naccordance with the laws of the State of Utah, without regard to its conflict of\nlaw rules.\n\n     Any notice given hereunder shall be in writing and shall be deemed to have\nbeen given when delivered by messenger or courier service (against appropriate\nreceipt), or mailed by registered or certified mail (return receipt requested),\naddressed as follows:\n\n     If to the Company:          Union Pacific Corporation\n                                 Eighth and Eaton Avenues\n                                 Bethlehem, Pennsylvania 18018\n\n                                 Attn: Senior Vice President,\n                                 Human Resources;\n\n     If to you:                  At the address hereabove provided;\n\nor at such other address as shall be indicated to either party in writing.\nNotice of change of address shall be effective only upon receipt.\n \n     If you are in agreement with the foregoing provisions of this Agreement,\nplease sign both copies of this letter and return one signed copy to the\nundersigned.\n\n                              UNION PACIFIC CORPORATION\n\n\n\n                              By:____________________________________\n                                    Richard K. Davidson\n                                    President and Chief Operation Officer\n\n\nAccepted:\n\n\n\n________________________________\nRobert Starzel\n\n\nDated: _________________________\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[9154],"corporate_contracts_industries":[9524],"corporate_contracts_types":[9539,9544],"class_list":["post-39669","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-union-pacific-corp","corporate_contracts_industries-transportation__railroads","corporate_contracts_types-compensation","corporate_contracts_types-compensation__employment"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/39669","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=39669"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=39669"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=39669"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=39669"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}