AMENDED AND RESTATED EMPLOYMENT AGREEMENT
Exhibit
10.1
AMENDED
AND RESTATED
THIS
AMENDED AND RESTATED AGREEMENT (this “Agreement”) is entered into as of the 22nd
day of October, 2009 (the “Effective Date”), by and between Spectrum Brands,
Inc., a Delaware corporation (the “Company”), and Xxxx X. Xxxxxx (the
“Executive”).
WHEREAS,
the Company and the Executive previously entered into an Amended and Restated
Employment Agreement, as thereafter amended (the “Existing Agreement”), dated
April 1, 2005;
WHEREAS,
the Existing Agreement was assumed by the Company pursuant to its Plan of
Reorganization confirmed July 15, 2009 (the “Plan”) and implemented on August
28, 2009; and
WHEREAS,
the Company and the Executive wish to amend and restate the Existing Agreement
in order to modify certain various provisions of the Agreement pursuant to this
Agreement; and
NOW,
THEREFORE, in consideration of the premises and mutual agreements contained
herein (promises that include benefits to which the Executive would not
otherwise be entitled), and for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Executive
hereby agree as follows:
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1.
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Employment
Duties and Acceptance. The Company hereby employs the
Executive, and the Executive agrees to serve and accept employment with
the Company, as Chief Executive Officer, reporting directly to the Board
of Directors of the Company (the “Board”). As Chief Executive
Officer, the Executive shall oversee and direct the operations of the
Company and perform such other duties consistent with the responsibilities
of the Chief Executive Officer, all subject to the direction and control
of the Board. During the Term (as defined below) the Executive
shall devote substantially all of his working time and efforts to such
employment.
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2.
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Term
of Employment. Subject to termination of employment
under Section 4 hereof, the Executive’s employment and appointment
hereunder shall be for a term commencing on the Effective Date and
expiring on September 30, 2012 (the “Initial Term”). Upon expiration of
the Initial Term (or any subsequent renewal term) and subject to
termination of employment under Section 4 hereof, this Agreement shall
terminate unless each of the Company and the Executive agrees to extend
the Agreement for an additional successive renewal period of one (1) year
(each such extension referred to as a “Renewal Term”). For
purposes of this Agreement, the failure of the Executive and the Company
to agree to an extension of this Agreement at the end of any then-current
term shall be deemed to be a termination of the Executive by the Company
without Cause as of the end of the then-current Initial or Renewal
Term. The Initial Term and any Renewal Terms shall be
collectively referred to as the
“Term.”
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3.
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Compensation. In
consideration of the performance by the Executive of his duties hereunder,
the Company shall pay or provide to the Executive the following
compensation which the Executive agrees to accept in full satisfaction for
his services, it being understood that necessary withholding taxes, FICA
contributions and the like shall be deducted from such
compensation:
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(a)
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Base
Salary. The Executive shall receive a base salary of
Eight Hundred and Twenty-Five Thousand Dollars ($825,000) per annum (“Base
Salary”), which Base Salary shall be paid in equal semi-monthly
installments each year, to be paid semi-monthly in arrears. The
Board will review from time to time the Base Salary payable to the
Executive hereunder and may, in its discretion, increase the Executive’s
Base Salary. Any such increased Base Salary shall be and become the “Base
Salary” for purposes of this
Agreement.
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(b)
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Bonus. The
Executive shall receive a bonus for each fiscal year ending during the
Term, payable annually in arrears and no later than December 31 of the
year in which such bonus is earned or, if the Company changes its fiscal
year end to end in December, then no later than March 15 of the year
following the year in which such bonus is earned, which shall be based on
a target of One Hundred Twenty-Five percent (125%) of Base Salary paid
during such fiscal year, provided the Company achieves certain annual
performance goals established by the Board from time to time (the
“Bonus”). The Bonus is currently governed by the Company’s
Management Incentive Program. The Board may, in its discretion,
increase the annual Bonus. Any such increased annual Bonus shall be and
become the “Bonus” for such fiscal year for purposes of this
Agreement.
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(c)
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Insurance
Coverages and Pension Plans. The Executive shall be entitled to
such insurance, pension and all other benefits as are generally made
available by the Company to its executive officers from time to
time.
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(d)
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Long-Term
Incentive Award. Subject to Board approval, Executive
shall be eligible to receive each fiscal year during the Initial Term
commencing with fiscal year 2010 (with the first such issuance to occur on
or about October 1, 2009) a Company stock or stock-based award or other
consideration equal to 0.6667% of the shares initially reserved for
issuance under Spectrum Brands, Inc. 2009 Incentive Plan (the “2009
Incentive Plan”), and with such award containing certain vesting
conditions to be based on the lapse of time and achievement of Company’s
performance objectives established by the Board from time to time,
provided that if such performance objectives are met, each such award will
fully vest within two years of issuance, subject to Executive’s continued
employment with the Company. The grant for fiscal year
2010 shall consist of restricted stock and 75% of such restricted stock
shall vest on October 1, 2010 and the remaining 25% of the restricted
stock shall vest on October 1, 2011, in each case subject to the Executive
remaining employed with the Company on each applicable
date.
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The
terms of any award under this section shall be more fully set forth in an
award agreement.
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(e)
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Vacation.
The Executive shall be entitled to five (5) weeks vacation each
year.
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(f)
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Other
Expenses. The Executive shall be entitled to reimbursement of all
reasonable and documented expenses actually incurred or paid by the
Executive in the performance of the Executive’s duties under this
Agreement, upon presentation of expense statements, vouchers or other
supporting information in accordance with Company policy. All
expense reimbursements and other perquisites of the Executive are
reviewable periodically by the Compensation Committee of the Board, if
there be one, or the Board.
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(g)
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Vehicle. Pursuant
to the Company’s policy for use of vehicles by executives, Executive shall
be provided the use of a leased vehicle suitable for a Chief Executive
Officer of a company similar to the Company. Unless the
Executive’s employment is terminated by the Company for Cause or by the
Executive pursuant to Section 4(d), Executive shall be entitled to
purchase such vehicle for $100 upon the earlier of (i) the expiration of
the lease for such vehicle or (ii) the termination of Executive’s
employment.
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(h)
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D&O
Insurance. The Company shall indemnify the Executive
against any and all claims and costs of defense arising from or relating
to Executive’s performance of his job responsibilities to the maximum
extent provided by law, but not for any action, suit, arbitration or other
proceeding (or portion thereof) initiated by the Executive, unless
authorized or ratified by the Board. Such indemnification shall
be covered by the terms of the Company’s policy of insurance for directors
and officers in effect from time to time (the “D&O
Insurance”). Copies of the Company’s charter, by-laws and
D&O Insurance will be made available to the Executive upon
request.
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(i)
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Effective
on 2009 Incentive Programs. Nothing in this Agreement
shall impact the Executive’s participation in the Company’s 2009 incentive
programs, which were assumed pursuant to the Plan and shall continue to be
implemented in accordance with those terms in effect on the day
immediately prior hereto.
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4.
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Termination.
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(a)
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Termination
by the Company for Cause. The Company shall have the right at any
time to terminate the Executive’s employment hereunder without prior
notice
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upon
the occurrence of any of the following (any such termination being
referred to as a termination for
“Cause”):
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(i)
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the
commission by the Executive of any deliberate and premeditated act taken
by the Executive in bad faith against the interests of the
Company;
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(ii)
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the
Executive has been convicted of, or pleads nolo
contendere
with respect to, any crime (felony or less) the circumstances of which
substantially relate to the circumstances, duties or responsibilities of
Executive’s position with the
Company;
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(iii)
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the
current use of illegal drugs, misuse of legal drugs, or intoxication of
Executive in the workplace or while performing his duties or
responsibilities associated with his position, the Executive’s failure of
a Company-related drug test, or the violation of any Company drug
policy;
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(iv)
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the
willful failure or refusal of the Executive to perform his duties as set
forth herein or the willful failure or refusal to follow the direction of
the Board, provided such failure or refusal continues after thirty (30)
days of the receipt of notice in writing from the Company or of such
failure or refusal, which notice refers to this Section 4(a) and indicates
the Company’s intention to terminate the Executive’s employment hereunder
if such failure or refusal is not remedied within such thirty (30) day
period; or
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(v)
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the
Executive breaches any of the terms of this Agreement or any other
agreement between the Executive and the Company which breach is not cured
within thirty (30) days subsequent to notice from the Company to the
Executive of such breach, which notice refers to this Section 4(a) and
indicates the Company’s intention to terminate the Executive’s employment
hereunder if such breach is not cured within such thirty (30) day
period.
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If
the definition of termination for “Cause” set forth above conflicts with
such definition in any other agreement to which the Executive is a party,
the definition set forth herein shall
control.
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(b)
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Termination
by Company for Death or Disability. The Company shall have the
right at any time to terminate the Executive’s employment hereunder upon
thirty (30) days prior written notice upon the Executive’s inability to
perform the essential functions of his job with or without reasonable
accommodation by reason of disability as defined under the Americans with
Disabilities Act (“Disability”), if within 30 days after such notice of
termination is given, the Executive continues to be unable to perform the
essential functions of his job within the meaning of his job with or
without reasonable accommodation.. The Company’s obligations hereunder
shall, subject to the provisions of Section 5(b), also terminate upon the
death of the Executive.
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(c)
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Termination
by Company without Cause. The Company shall have the right at any
time to terminate the Executive’s employment for any other reason without
Cause upon sixty (60) days prior written notice (or pay in lieu thereof)
to the Executive. The non-renewal of this Agreement at the end
of the then-current term pursuant to Section 2 shall also be deemed a
termination by the Company without
Cause.
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(d)
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Voluntary
Termination by Executive. The Executive shall be
entitled to voluntarily terminate his employment hereunder upon sixty (60)
days prior written notice to the Company. Except as provided in
Section 4(e), any such termination shall be treated as a termination by
the Company for “Cause” under Section 5, unless notice of such termination
was given within sixty (60) days after a Change in Control (which, for
purposes of this Agreement, shall have the meaning given that term in the
2009 Incentive Plan), in which case such termination shall be treated in
accordance with Section 5(c)
hereof.
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(e)
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Termination
by Executive Arising Out of Constructive Termination. The Executive
shall be entitled to terminate his employment and appointment hereunder
upon the occurrence of a Constructive Termination. For the
purposes of this Agreement and any stock option agreements or restricted
stock unit award agreements between the Company and the Executive, any
such termination shall be treated as a termination by the Company without
Cause. For this purpose, a “Constructive Termination” shall
mean:
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(i)
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any
reduction, not consented to by Executive, in Executive’s Base Salary or in
Executive’s target Bonus or target long term incentive amounts set forth
in Sections 3(a), 3(b) and 3(d) then in
effect;
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(ii)
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the
relocation, not consented to by Executive, of the Company’s office at
which Executive is principally employed as of the date hereof to a
location more than fifty (50) miles from such office, or the requirement
by the Company that Executive be based at an office other than the
Company’s office at such location on an extended basis, except for
required travel on the Company’s business to an extent substantially
consistent with Executive’s business travel
obligations;
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(iii)
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a
substantial diminution or other substantive adverse change, not consented
to by Executive, in the nature or scope of Executive’s responsibilities,
authorities, powers, functions or duties;
or
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(iv)
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a
breach by the Company of any of its other material obligations under this
Agreement;
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provided,
however, that in each case, Executive may not terminate his employment for
Constructive Termination unless Executive (w) provides the Company with 30
days advance written notice of his intent to resign
for
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Constructive
Termination, (x) such notice is given within 60 days of the events or
circumstances claimed to give rise to Constructive Termination, (y) the
Company fails to cure such alleged violation during such 30 day period and
(z) if the Company fails to cure such alleged violation, Executive must
terminate his employment within six months of the initial occurrence of
the facts or circumstances giving rise to Constructive
Termination.
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(f)
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Notice
of Termination. Any termination by the Company for Cause or by the
Executive for Constructive Termination shall be communicated by Notice of
Termination to the other party hereto given in accordance with Section 8.
For purposes of this Agreement, a “Notice of Termination” means a written
notice given prior to the termination which (i) indicates the specific
termination provision in this Agreement relied upon, (ii) sets forth in
reasonable detail the facts and circumstances claimed to provide a basis
for termination of the Executive’s employment under the provision so
indicated and (iii) if the termination date is other than the date of
receipt of such notice, specifies the termination date of this Agreement
(which date shall be not more than fifteen (15) days after the giving of
such notice, unless a thirty-day notice is required pursuant to another
section of this Agreement). The failure by any party to set forth in the
Notice of Termination any fact or circumstance which contributes to a
showing of Cause or Constructive Termination shall not waive any right of
such party hereunder or preclude such party from asserting such fact or
circumstance in enforcing its rights
hereunder.
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5.
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Effect
of Termination of
Employment.
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(a)
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Termination
by the Company with Cause or
Voluntarily by the Executive. If the Executive’s
employment hereunder is terminated by the Company with Cause or if the
Executive voluntarily terminates his employment hereunder (except under
circumstances constituting a Constructive Termination, or as provided in
Section 5(c)), the Executive’s salary and other benefits specified in
Section 3 shall cease at the time of such termination, and the Executive
shall not be entitled to any compensation specified in Section 3 which was
not required to be paid prior to such termination. Upon any
termination of employment, the Company shall promptly pay to the Executive
accrued salary and vacation pay, reimbursement for expenses incurred
through the date of termination in accordance with Company policy, and
accrued benefits under the Company’s benefit plans, programs and
arrangements in accordance with their
terms.
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(b)
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Without
Cause, Death or Disability. If the Executive’s employment hereunder
is terminated by the Company (a) without Cause or (b) by reason of death
or Disability or (c) by virtue of the non-renewal of this Agreement
pursuant to Section 2, and the Executive executes a separation agreement
with a release of claims agreeable to the Company
(a
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“Release”)
(to the extent that the Executive is physically and mentally capable to
execute such an agreement) no later than 60 days after his termination of
employment, the ongoing compensation obligations specified in
Section 3 shall be discontinued as of the date of termination and the
Company shall thereafter timely remit the amounts and provide the
Executive the benefits as follows:
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(i)
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The
Company shall pay to the Executive as severance, an amount in cash equal
to double the sum of (A) the Executive’s Base Salary, and (B) Executive’s
annual target Bonus. Such severance payment will be made within 10 days
following when the Release becomes effective in accordance with its
terms. Additionally, the Company shall pay to the Executive an
amount equal to a pro rata portion of the annual Bonus the Executive
actually would have earned for the fiscal year in which termination occurs
if Executive’s employment had not ceased. Such pro-ration shall
be based on the number of weeks the Executive worked during such fiscal
year prior to such termination divided by 52. Payment of this
pro-rated Bonus amount will be made in cash at the time at which a Bonus
would have been paid to the Executive for the fiscal year in which
termination occurs if the Executive had not terminated employment with the
Company.
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(ii)
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For
the greater of (i) the 24-month period immediately following such
termination or (ii) the remainder of the Initial Term, the Company shall
arrange to provide the Executive and his dependents the additional welfare
benefits specified in Section 3(c) (which, for the avoidance of doubt, do
not include those receivable in accordance with Section 5(d))
substantially similar to those provided to the Executive and his
dependents by the Company immediately prior to the date of termination, at
no greater cost to the Executive than the cost to the Executive
immediately prior to such date. Benefits otherwise receivable by the
Executive pursuant to this Section 5(b)(ii) (which, for the avoidance of
doubt, do not include those receivable in accordance with Section 5(d))
shall cease immediately upon the discovery by the Company of the
Executive’s breach of the covenants contained in Section 6 or 7
hereof. In addition, benefits otherwise receivable by the
Executive pursuant to this Section 5(b)(ii) (which, for the avoidance of
doubt, do not include those receivable in accordance with Section 5(d))
shall be reduced to the extent benefits of the same type are received by
or made available to the Executive during the 24-month period following
the Executive’s termination of employment (and any such benefits received
by or made available to the Executive shall be reported to the Company by
the
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Executive);
provided, however, that the Company shall reimburse the Executive for the
excess, if any, of the cost of such benefits to the Executive over such
cost immediately prior to the date of termination, with any such
reimbursement made no later than the last day of the year in which such
cost is incurred.
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(iii)
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The
Executive’s accrued vacation (determined in accordance with Company
policy) at the time of termination shall be paid as soon as reasonably
practicable but no later than 30 days after termination of
employment.
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(iv)
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Executive
shall continue to be entitled to indemnification pursuant to Section 3(h)
for events occurring prior to the date of Executive’s
termination.
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(v)
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Any
outstanding awards made pursuant to Section 3(d) for which the passage of
time is the sole remaining basis for vesting will become vested
immediately.
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(vi)
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Any
payments provided for hereunder shall be paid net of any applicable
withholding required under federal, state, or local law and any additional
withholding to which the Executive has
agreed.
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(c)
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Following
Change in Control. If the Executive elects to terminate
his employment within sixty (60) days following a Change in Control in
accordance with Section 4(d), and the Executive executes a Release (to the
extent that the Executive is physically and mentally capable to execute
such an agreement) within 60 days of his termination of employment, then
such termination by the Executive shall be treated as a termination by the
Company without Cause, and the Executive shall be entitled to the
compensation provided in Section 5(b). Notwithstanding the
foregoing, the Company may require that the Executive continue to remain
in the employ of the Company for up to a maximum of three (3) months
following the Change in Control (the “Post-Term
Period”).
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(d)
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Acknowledgement
of Existing Rights. The Company and the Executive
acknowledge and agree that, whenever the Executive ceases to be an
employee of the Company for any reason, the Company shall pay the
Executive the amounts and provide the Executive the benefits as
follows:
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(i)
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Company
shall reimburse Executive for the reasonable expenses associated with
Executive’s tax preparation and financial planning services for a period
of ten (10) years from the date the Executive ceases to be an employee of
the Company; and
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(ii)
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For
a period of ten (10) years from the date the Executive ceases to be an
employee of the Company, the Company shall arrange to provide the
Executive and his spouse with continuing medical, dental and
life
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insurance
benefits substantially similar to those provided to the Executive and his
spouse by the Company immediately prior to the date the Executive ceases
to be an employee of the Company, at no greater cost to the Executive than
the cost to the Executive immediately prior to such
date.
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Any
amounts subject to reimbursement under this subsection shall be reimbursed
no later that the last day of the year in which the expense is incurred
or, if later, within 60 days of the date of
submission.
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6.
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Agreement
Not to Compete.
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(a)
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The
Executive agrees that during the during his employment and for the
two-year period immediately following the termination of his employment
for any reason (hereafter, the “Non-Competition Period”), he will not,
directly or indirectly, either separately, jointly or in association with
others, as an officer, director, consultant, agent, employee, owner,
principal, partner or stockholder of any business, provide
services of the same or similar kind or nature that he provides to the
Company to, or have a financial interest in (excepting only the ownership
of not more than 5% of the outstanding securities of any class listed on
an exchange or the Nasdaq Stock Market), any competitor of the Company
(which means any person or organization that is in the business of or
makes money from designing, developing, or selling products or services
similar to those products and services developed, designed or sold by the
Company); provided, however, that the Executive may provide services to or
have a financial interest in a business that competes with the Company if
his employment or financial interest is with a separately managed or
operated division or affiliate of such business that does not compete with
the Company. The Executive recognizes, acknowledges and the Company is a
global consumer products company with operations throughout the world,
including significant operations in Wisconsin, where the Company’s largest
business segment is headquartered and the Company maintains manufacturing
facilities and agrees that Executive's duties necessarily require
significant contact with its operations throughout the world and his
duties and responsibilities hereunder will be performed throughout the
United States and Canada and will result in Executive’s having
material contact with the Company’s customers, suppliers, vendors, and
employees throughout the United States and Canada, including significant
contact with the Company’s Wisconsin operations. Accordingly, the
Parties acknowledge and agree that the restrictions set forth in this
Section 6(a) shall extend to the United States and Canada (hereafter, the
“Restricted Territory”) and that this geographic scope is reasonable based
on the geographic scope of Executive’s duties and
responsibilities.
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(b)
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Without
limiting the generality of clause (a) above, the Executive further agrees
that, during the Non-Competition Period, he will not, within the
Restricted
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Territory,
directly or indirectly, either separately, jointly or in association with
others, solicit, divert, take away, or attempt to solicit, divert, or take
away, any customer or person to whom the Company has sent a written sales
or servicing proposal or contract in connection with the business of the
Company within the immediately preceding two-year period (hereafter, a
“Prospective Customer”), for the purpose of or with the intention of
selling or providing to such customer or Prospective Customer any product
or service similar to any product or service sold, provided, offered, or
under development by the Company during the two-year period immediately
preceding the termination of Executive’s employment for any reason (or
during the preceding two years if during Executive’s employment);
provided, however, that this restriction shall only apply
to customers or Prospective Customers of the Company with whom
Executive had contact or about whom the Executive acquired confidential
information by virtue of his employment with the Company at any time
during such two-year period.
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(c)
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The
Executive agrees that during the Non-Competition Period, he shall not
initiate contact in order to induce, solicit or encourage any person to
leave the Company’s employ. Nothing in this paragraph is meant to prohibit
an employee of the Company that is not a party to this Agreement from
becoming employed by another organization or
person.
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(d)
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Sections
6(a), 6(b), and 6(c) each are intended to be considered and construed as
separate and independent covenants; any ruling that any one or more
of these sections is overbroad or otherwise invalid shall not affect the
validity of any of the other sections or any other section of this
Agreement.
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(e)
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For
purposes of this Section 6 and Section 7, the “Company” refers to the
Company and any incorporated or unincorporated subsidiaries of the
Company.
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7.
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Secret
Processes and Confidential
Information.
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(a)
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The
Executive agrees to hold in strict confidence and, except as the Company
may authorize or direct, not disclose to any person or use (except in the
performance of his services hereunder) any confidential information or
materials received by the Executive from the Company and any confidential
information or materials of other parties received by the Executive in
connection with the performance of his duties hereunder. For
purposes of this Section 7(a), confidential information or materials shall
include, but are not limited to, existing and potential customer
information, existing and potential supplier information, product
information, design and construction information, pricing and
profitability information, financial information, sales and marketing
strategies and techniques and business ideas or practices (hereafter
“Confidential
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Information”). The
restriction on the Executive’s use or disclosure of Confidential
Information shall remain in force during the Executive’s employment
hereunder and until the earlier of (x) the expiration of a period of two
(2) years thereafter or (y) such time as the Confidential Information is
of general knowledge in the industry through no fault of the Executive or
any agent of the Executive. The Executive also agrees to return
to the Company promptly upon its request any Company information or
materials in the Executive’s possession or under the Executive’s
control. This Section 7(a) is not intended to preclude
Executive from being gainfully employed by another. Rather, it
is intended to prohibit Executive from using the Company’s confidential
information or materials in any subsequent employment or employment
undertaken that is not for the benefit of the Company during the
identified period.
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(b)
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The
Executive will promptly disclose to the Company and to no other person,
firm or entity all inventions, discoveries, improvements, trade secrets,
formulas, techniques, processes, know-how and similar matters, whether or
not patentable and whether or not reduced to practice, which are conceived
or learned by the Executive during the period of the Executive’s
employment with the Company, either alone or with others, which relate to
or result from the actual or anticipated business or research of the
Company or which result, to any extent, from the Executive’s use of the
Company’s premises or property (collectively called the “Inventions”). The
Executive acknowledges and agrees that all the Inventions shall be the
sole property of the Company, and the Executive hereby assigns to the
Company all of the Executive’s rights and interests in and to all of the
Inventions, it being acknowledged and agreed by the Executive that all the
Inventions are works made for hire. The Company shall be the sole owner of
all domestic and foreign rights and interests in the Inventions. The
Executive agrees to assist the Company at the Company’s expense to obtain
and from time to time enforce patents and copyrights on the
Inventions.
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(c)
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Upon
the request of, and, in any event, upon termination of the Executive’s
employment with the Company, the Executive shall promptly deliver to the
Company all documents, data, records, notes, drawings, manuals and all
other tangible information in whatever form which pertains to the Company,
and the Executive will not retain any such information or any reproduction
or excerpt thereof. Nothing in this Agreement or elsewhere
shall prevent the Executive from retaining his desk calendars, address
book and rolodex.
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(d)
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Nothing
in this Section 7 diminishes or limits any protection granted by law to
trade secrets or relieves the Executive of any duty not to disclose, use
or misappropriate any information that is a trade secret for as long as
such information remains a trade
secret.
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8.
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Notices. All
notices or other communications hereunder shall be in writing and shall be
deemed to have been duly given (a) when delivered personally, (b) upon
confirmation of receipt when such notice or other communication is sent by
facsimile or telex, (c) one day after delivery to an overnight delivery
courier, or (d) on the fifth day following the date of deposit in the
United States mail if sent first class, postage prepaid, by registered or
certified mail. The addresses for such notices shall be as
follows:
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(a)
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For
notices and communications to the Company:
Xxx
Xxxxxxxxx Xxxxxxx
Xxxxx
0000
Xxxxxxx,
XX 00000
Facsimile: (000)
000-0000
Attention: General
Counsel
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(b)
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For
notices and communications to the Executive: at the
address set forth in the records of the Company, as updated at the request
of the Executive from time to time.
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Any party
hereto may, by notice to the other, change its address for receipt of notices
hereunder.
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9.
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Xxxxxxx
000X .
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(x)
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This Agreement is
intended to satisfy the requirements of Section 409A of the Internal
Revenue Code of 1986, as amended (“Section
409A”) with respect to amounts, if any, subject thereto and shall
be interpreted and construed and shall be performed by the parties
consistent with such intent. This
Agreement may be amended at any time, without the consent of the
Executive, to avoid the application of Section 409A in a particular
circumstance or to satisfy any of the requirements under Section
409A. Nothing in the Agreement shall provide a basis for any
person to take action against the Company or any subsidiary or affiliate
based on matters covered by Section 409A, including the tax treatment of
any award made under the
Agreement.
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(b)
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Notwithstanding
anything in this Agreement to the contrary, the following special rule
shall apply, if and to the extent required by Section 409A, in the event
that (i) the Executive is deemed to be a “specified employee” within the
meaning of Section 409A(a)(2)(B)(i), (ii) amounts or benefits under this
Agreement or any other program, plan or arrangement of the Company or a
controlled group affiliate thereof are due or payable on account of
“separation from service” within the meaning of Treasury Regulations
Section 1.409A-1(h) and (iii) the Executive is employed by a public
company or a controlled group affiliate thereof: no payments hereunder
that are “deferred compensation” subject to Section 409A shall be made to
the Executive prior to the date that is six (6) months after
the
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date
of the Executive’s separation from service or, if earlier, the Executive’s
date of death; following any applicable six (6) month delay, all such
delayed payments will be paid in a single lump sum on the earliest
permissible payment date.
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(c)
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Any
payment or benefit due upon a termination of the Executive’s employment
that represents a “deferral of compensation” within the meaning of Section
409A shall be paid or provided to the Executive only upon a “separation
from service” as defined in Treas. Reg. § 1.409A-1(h). Each
payment made under this Agreement shall be deemed to be a separate payment
for purposes of Section 409A. Amounts payable under this
Agreement shall be deemed not to be a “deferral of compensation” subject
to Section 409A to the extent provided in the exceptions in Treasury
Regulation §§ 1.409A-1(b)(4) (“short-term deferrals”) and (b)(9)
(“separation pay plans,” including the exception under subparagraph (iii))
and other applicable provisions of Treasury Regulation § 1.409A-1 through
A-6.
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(d)
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Notwithstanding
anything to the contrary in Agreement, any payment or benefit under this
Agreement or otherwise that is exempt from Section 409A pursuant to
Treasury Regulation § 1.409A-1(b)(9)(v)(A) or (C) (relating to certain
reimbursements and in-kind benefits) shall be paid or provided to the
Executive only to the extent that the expenses are not incurred, or the
benefits are not provided, beyond the last day of the second calendar year
following the calendar year in which the Executive’s
“separation from service” occurs; and provided further that such expenses
are reimbursed no later than the last day of the third calendar year
following the calendar year in which the Executive’s “separation from
service” occurs. To the extent any indemnification payment, expense
reimbursement, or the provision of any in-kind benefit is determined to be
subject to Section 409A (and not exempt pursuant to the prior sentence or
otherwise), the amount of any such indemnification payment or expenses
eligible for reimbursement, or the provision of any in-kind benefit, in
one calendar year shall not affect the indemnification payment or
provision of in-kind benefits or expenses eligible for reimbursement in
any other calendar year (except for any life-time or other aggregate
limitation applicable to medical expenses), and in no event shall any
indemnification payment or expenses be reimbursed after the last day of
the calendar year following the calendar year in which the Executive
incurred such indemnification payment or expenses, and in no event shall
any right to indemnification payment or reimbursement or the provision of
any in-kind benefit be subject to liquidation or exchange for another
benefit.
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10.
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General.
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(a)
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Governing
Law. This Agreement shall be construed under and governed by the
laws of the State of Wisconsin, without reference to its conflicts of law
principles.
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(b)
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Amendment;
Waiver. This Agreement may be amended, modified, superseded,
canceled, renewed or extended, and the terms hereof may be waived, only by
a written instrument executed by all of the parties hereto or, in the case
of a waiver, by the party waiving compliance. The failure of any party at
any time or times to require performance of any provision hereof shall in
no manner affect the right at a later time to enforce the same. No waiver
by any party of the breach of any term or covenant contained in this
Agreement, whether by conduct or otherwise, in any one or more instances,
shall be deemed to be, or construed as, a further or continuing waiver of
any such breach, or a waiver of the breach of any other term or covenant
contained in this Agreement.
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(c)
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Successors
and Assigns. This Agreement shall be binding upon the Executive,
without regard to the duration of his employment by the Company or reasons
for the cessation of such employment, and inure to the benefit of his
administrators, executors, heirs and assigns, although the obligations of
the Executive are personal and may be performed only by him. This
Agreement shall also be binding upon and inure to the benefit of the
Company and its subsidiaries, successors and assigns, including any
corporation with which or into which the Company or its successors may be
merged or which may succeed to their assets or
business.
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(d)
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Counterparts.
This Agreement may be executed in two counterparts, each of which shall be
deemed an original but which together shall constitute one and the same
instrument.
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(e)
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Non-exclusivity
of Rights. Nothing in this Agreement shall prevent or limit the
Executive’s continuing or future participation during his employment
hereunder in any benefit, bonus, incentive or other plan or program
provided by the Company or any of its affiliates and for which the
Executive may qualify. Amounts which are vested benefits or which the
Executive is otherwise entitled to receive under any plan or program of
the Company or any affiliated company at or subsequent to the date of the
Executive’s termination of employment with the Company shall, subject to
the terms hereof or any other agreement entered into by the Company and
the Executive on or subsequent to the date hereof, be payable in
accordance with such plan or
program.
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(f)
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Mitigation.
In no event shall the Executive be obligated to seek other employment by
way of mitigation of the amounts payable to the Executive under any of the
provisions of this Agreement. In the event that the Executive shall give a
Notice of Termination for Constructive Termination and it shall thereafter
be determined that Constructive Termination did not take place, the
employment of the Executive shall, unless the Company and the Executive
shall otherwise mutually agree, be deemed to have terminated, at the date
of giving such purported Notice of Termination, and the Executive shall be
entitled to receive only those
payments
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and
benefits which he would have been entitled to receive at such date had he
terminated his employment voluntarily at such date under Section 4(d) of
this Agreement.
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(g)
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Equitable
Relief. The Executive expressly agrees that breach of any provision
of Sections 6 or 7 of this Agreement would result in irreparable injuries
to the Company, that the remedy at law for any such breach will be
inadequate and that upon breach of such provisions, the Company, in
addition to all other available remedies, shall be entitled as a matter of
right to injunctive relief in any court of competent jurisdiction without
the necessity of proving the actual damage to the
Company.
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(h)
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Severability.
Sections 6(a), 6(b), 6(c), 7(a), 7(b) and 10(i) of this Agreement shall be
considered separate and independent from the other sections of this
Agreement and no invalidity of any one of those sections shall affect any
other section or provision of this Agreement. However, because it is
expressly acknowledged that the pay and benefits provided under this
Agreement are provided, at least in part, as consideration for the
obligations imposed upon Executive under Sections 6(a), 6(b), 6(c), 7(a)
and 7(b), should Executive challenge those obligations or any court
determine that any of the provisions under these Sections is unlawful or
unenforceable, such that Executive need not honor those provisions, then
Executive shall not receive the pay and benefits, provided for in this
Agreement following termination, (or if he has already received severance
pay or benefits, Executive shall be required to repay such severance pay
and benefits to the Company within 10 days of written demand by the
Company) if otherwise available to Executive, irrespective of the reason
for the end of Executive’s
employment.
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(i)
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Entire
Agreement. This Agreement constitutes the entire understanding of
the parties hereto with respect to the subject matter hereof and supersede
all prior negotiations, discussions, writings and agreements between them,
including the Existing Agreement, with respect to the subject matter
hereof.
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[signature
page follows]
15
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written.
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By:
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/s/
Xxxx X. Xxxxxx
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Xxxx
X. Xxxxxx
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Vice
President, Secretary and General
Counsel
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EXECUTIVE:
/s/
Xxxx X.
Xxxxxx
Xxxx X.
Xxxxxx
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