EXHIBIT 99.1
2003 SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
CHANGE OF CONTROL AGREEMENT
THIS 2003 SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN CHANGE OF CONTROL
AGREEMENT ("Agreement") is made as of the 29 day of April 2005, between Dura
Automotive Systems, Inc., a Delaware corporation ("DASI"), Dura Operating Corp.,
a Delaware corporation ("DOC" and together with DASI, "Dura") and Xxxxx X. Xxxxx
("Participant").
Participant is a participant under the Dura Automotive Systems, Inc. 2003
Supplemental Executive Retirement Plan (the "SERP"), and Dura is entering into
this Agreement to provide Participant with greater certainty in receiving any
payments due to such Participant under the SERP in the event of a Change of
Control of Dura. (As used in this Agreement, the term "Change of Control" and
certain other capitalized terms have the meanings ascribed to them in Section 7,
at the end of this Agreement.)
Dura and Participant agree, effective as of the date first set forth above
(the "Effective Date"), as follows:
1. Special SERP Payment. Upon the occurrence of a Change of Control, Dura
shall, within 30 days after the Change of Control, pay to Participant a
lump sum benefit payment equal to the total amount that the Participant
was entitled to receive under the SERP as of the date of the Change of
Control. The lump sum benefit shall be the lump sum actuarial equivalent
of a single life annuity (with a 10-year certain term) payable over the
lifetime of the Participant and will be calculated using the actuarial
assumptions used for FAS 87 purposes in the most recently audited annual
report; provided, however, that the lump sum shall not be discounted due
to commencement prior to reaching age 65. This Section 1 is intended to
override any provision of the SERP that would otherwise cause Participant
to receive an amount which is less than what is provided for herein. This
payment is in full satisfaction of Dura's obligations to Participant under
the SERP and with respect to any provisions in other agreements which
provide for recognition of enhanced service under the SERP.
2. Other Benefits.
2.1 Reimbursement of Certain Expenses After a Change of Control.
(a) From and after a Change of Control, Dura or its successor
shall pay, as incurred, all expenses of Participant, including
the reasonable fees of counsel engaged by Participant, of
defending any action brought to have this agreement declared
invalid or unenforceable.
(b) From and after a Change of Control, Dura or its successor
shall pay, as incurred, all expenses of Participant, including
the reasonable fees of counsel engaged by Participant, of
prosecuting any action to compel Dura or its successor to
comply with the terms of this Agreement upon receipt from
Participant of an undertaking to repay Dura for such expenses
if, and only if, it is ultimately determined by a court of
competent jurisdiction that Participant had no reasonable
grounds for bringing that action (which determination need not
be made simply because Participant fails to succeed in the
action).
(c) From and after a Change of Control, expenses (including
attorney's fees) incurred by Participant in defending any
action, suit, or proceeding commenced or
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threatened (whether before or after the Change of Control)
against Participant for any action or failure to act as an
employee, officer, or director of Dura or any Subsidiary shall
be paid by Dura or its successor, as they are incurred, in
advance of final disposition of the action suit, or proceeding
upon receipt of an undertaking by or on behalf of Participant
in which Participant agrees to reasonably cooperate with Dura,
its Subsidiary or successor, as the case may be, concerning
the action, suit, or proceeding and (i) if the action, suit,
or proceeding is commenced or threatened against Participant
for any action or failure to act as a director, to repay the
amount if it is proved by a preponderance of evidence in a
court of competent jurisdiction that Participant's action or
failure to act involved an act or omission undertaken with
deliberate intent to cause injury to Dura or a Subsidiary or
undertaken with gross negligence for the best interests of
Dura or a Subsidiary, or (ii) if the action, suit, or
proceeding is commenced or threatened against Participant for
any action or failure to act as an officer or employee, to
repay the amount if it is ultimately determined that
Participant is not entitled to be indemnified.
2.2. Indemnification. From and after a Change of Control, Dura shall
indemnify Participant, to the full extent permitted or authorized by the
Delaware General Corporation Law as it may from time to time be amended,
if Participant is (whether before or after the Change of Control) made or
threatened to be made a party to any threatened, pending, or completed
action, suit, or proceeding, whether civil, criminal, administrative, or
investigative, by reason of the fact that Participant is or was a
director, officer, or employee of Dura or any Subsidiary, or is or was
serving at the request of Dura or any subsidiary as a director, trustee,
officer, or employee of a corporation, partnership, joint venture, trust,
or other enterprise. The indemnification provided by this Subsection 2.2
shall not be deemed exclusive of any other rights to which Participant may
be entitled under the certificate of incorporation or the by-laws of Dura
or of any Subsidiary, or any agreement, vote of shareholders or
disinterested directors, or otherwise, both as to action in Participant's
official capacity and as to action in another capacity while holding such
office, and shall continue as to Participant after Participant has ceased
to be a director, trustee, officer, or employee and shall inure to the
benefit of the heirs, executors, and administrators of Participant.
3. No Set-Off; No Effect Upon Other Plans. Dura's obligation to make the
payments provided for in this Agreement and otherwise to perform its
obligations hereunder shall not be affected by any set-off, counterclaim,
recoupment, defense, or other claim whatsoever that Dura or any of its
Subsidiaries may have against Participant. Except as provided in the last
sentence of this Section 3, neither the amount of any payment provided for
under this Agreement nor Participant's right to any other benefit under
this Agreement shall be reduced by any compensation or benefits earned by
Participant as the result of employment by another employer or otherwise
after the termination of Participant's employment. Neither the provisions
of this Agreement, nor the execution of the waiver and release referred to
in Subsection 4.2 below, nor the making of any payment provided for
hereunder shall reduce any amounts otherwise payable, or in any way
diminish Participant's rights, under any stock option plan, tax-qualified
retirement plan, disability or insurance plan, or other similar contract,
plan, or arrangement of Dura, except that the payment under Section 1
shall satisfy in full all obligations Dura has to Participant for payments
under the SERP.
4. Certain Limitations on Benefits.
4.1. Taxes; Withholding of Taxes. Without limiting either the right
of Dura to withhold taxes pursuant to this Subsection 4.1, Participant
shall be responsible for all income, excise, and other taxes (federal,
state, city, or other) imposed on or incurred by Participant as a result
of receiving
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the payments provided in this Agreement, including, without limitation,
the payments provided under Section 1 of this Agreement. Dura or any of
its Subsidiaries may withhold from any amounts payable under this
Agreement all federal, state, city, or other taxes as Dura or any of its
Subsidiaries shall determine to be required pursuant to any law or
government regulation or ruling.
4.2. Waiver and Release. Dura may condition the payment of any
amounts otherwise due under Section 1 of this Agreement upon (a) the
execution by Participant of a waiver and release in the form attached to
this Agreement as Exhibit A, with blanks appropriately filled and, in the
case of clause (e) contained therein, completed with the number of days
that Dura determines is required under applicable law, but in no event
more than 45 days, and (b) the observation of such waiting or revocation
periods, if any, before and after execution of the waiver and release by
Participant as are required by law, such as, for example, the waiting or
revocation periods required for a waiver and release to be effective with
respect to claims under the Age Discrimination in Employment Act, provided
that Dura delivers to Participant such a waiver and release, appropriately
completed, within seven days of the Termination Date.
5. Term of this Agreement. This Agreement shall be effective as of the
Effective Date and shall thereafter apply to any Change of Control
occurring on or after the effective date.
6. Miscellaneous.
6.1. Successor to Dura. Dura shall not consolidate with or merge
into any other corporation, or sell, transfer or dispose of all or
substantially all of its assets to another corporation or other entity,
unless such other corporation or other entity shall assume this Agreement
in a signed writing and deliver a copy thereof to Participant. Upon such
assumption the successor corporation or other entity shall become
obligated to perform the obligations of Dura under this Agreement and the
term "Dura" as used in this Agreement shall be deemed to refer to such
successor corporation or other entity.
6.2. Notices. For purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and
shall be deemed to have been duly given (a) when delivered in person (to
Participant in the case of notices to Participant and to the Secretary of
Dura in the case of notices to Dura) or (b) on the date actually received
when sent by United States registered mail, return receipt requested,
postage prepaid, and addressed, in the case of notices to Dura, as
follows:
Dura Automotive Systems, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxx Xxxxx, XX 00000
Attention: Secretary
and, in the case of notices to Participant, properly addressed to
Participant at Participant's most recent home address as shown on the
records of Dura, or such other address as either party may have furnished
to the other in writing in accordance herewith, except that notices of
change of address shall be effective only upon receipt.
6.3. Administration. Dura shall be responsible for the general
administration of this Agreement. All fees and expenses billed by the
Accounting Firm for services contemplated under this Agreement shall be
the responsibility of Dura.
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6.4. Source of Payments. DASI and DOC shall be jointly and severally
liable for all payments required under this Agreement. All payments under
this Agreement shall be made in cash and shall be made solely from the
general assets of DASI or DOC (or from a grantor trust, if any,
established by Dura for purposes of making payments under this Agreement
and other similar agreements), and Participant shall have the rights of an
unsecured general creditor of DASI and DOC with respect thereto.
6.5. Validity. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any
other provision of this Agreement which shall remain in full force and
effect.
6.6. Modification, Waiver, Etc. No provision of this Agreement may
be modified, waived, or discharged unless such waiver, modification, or
discharge is agreed to in a writing signed by Participant and Dura. No
waiver by either party hereto at any time of any breach by the other party
of, or compliance with, any condition or provision of this Agreement to be
performed by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the same time or at any prior or
subsequent time. No agreement or representation, oral or otherwise,
express or implied, with respect to the subject matter hereof has been
made by either party that is not set forth expressly in this Agreement.
This Agreement shall inure to the benefit of and be enforceable by
Participant's personal representatives, executors, administrators,
successors, heirs, and designees. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware.
7. Definitions.
7.1. Change of Control. A "Change of Control" shall be deemed to
have occurred if at any time or from time to time while this Agreement is
in effect:
(a) any person (other than Dura, any of its Subsidiaries, any
employee benefit plan or employee stock ownership plan of
Dura, or any person organized, appointed, or established
by Dura for or pursuant to the terms of any such plan),
alone or together with any of its affiliates, becomes the
beneficial owner of 15% or more (but less than 50%) of
the Common Stock then outstanding;
(b) Any person (other than Dura, any of its Subsidiaries, any
employee benefit plan or employee stock ownership plan of
Dura, or any person organized, appointed, or established
by Dura for or pursuant to the terms of any such plan),
alone or together with any of its affiliates, becomes the
beneficial owner of 50% or more of the Common Stock then
outstanding;
(c) Any person commences or publicly announces an intention
to commence a tender offer or exchange offer the
consummation of which would result in the person becoming
the beneficial owner of 15% or more of the Common Stock
then outstanding;
(d) At any time during any period of 24 consecutive months,
individuals who were directors at the beginning of the
24-month period no longer constitute a majority of the
members of the Board of Directors of Dura, unless the
election, or the nomination for election by Dura's
stockholders, of each director who was not a director at
the beginning of the period is approved by at least a
majority of the
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directors who (i) are in office at the time of the
election or nomination and (ii) were directors at the
beginning of the period;
(e) A record date is established for determining stockholders
entitled to vote upon (i) a merger or consolidation of
Dura with another corporation in which those persons who
are stockholders of Dura immediately before the merger or
consolidation are to receive or retain less than 50% of
the stock of the surviving or continuing corporation,
(ii) a sale or other disposition of all or substantially
all of the assets of Dura and its Subsidiaries, taken as
a whole, or (iii) the dissolution of Dura; or
(f) (i) Dura is merged or consolidated with another
corporation and those persons who were stockholders of
Dura immediately before the merger or consolidation
receive or retain less than 50% of the stock of the
surviving or continuing corporation, (ii) there occurs a
sale, transfer or other disposition of all or
substantially all of the assets of Dura, or (iii) Dura is
dissolved.
Notwithstanding anything herein to the contrary, if an event described in
clause (b), clause (d), or clause (f) above occurs, the occurrence of that
event will constitute an irrevocable Change of Control. Furthermore,
notwithstanding anything herein to the contrary, if an event described in
clause (c) occurs, and the Board of Directors either approves such offer
or takes no action with respect to such offer, then the occurrence of that
event will constitute an irrevocable Change of Control. On the other hand,
notwithstanding anything herein to the contrary, if an event described in
clause (a), or clause (e), above occurs, or if an event described in
clause (c) occurs and the Board of Directors does not either approve such
offer or take no action with respect to such offer as described in the
preceding sentence, and a majority of those members of the Board of
Directors who were Directors prior to such event determine, within the
90-day period beginning on the date such event occurs, that the event
should not be treated as a Change of Control, then, from and after the
date that determination is made, that event will be treated as not having
occurred. If no such determination is made, a Change of Control resulting
from any of the events described in the immediately preceding sentence
will constitute an irrevocable Change of Control on the 91st day alter the
occurrence of the event.
7.2. Subsidiary. A "Subsidiary" means any corporation, partnership,
or other entity a majority of the voting control of which is directly or
indirectly owned or controlled at the time in question by Dura.
8. Termination of Prior Agreement. The Change of Control Agreement dated as
of June 16, 2004, by and between Dura and Participant (the "Prior
Agreement") is hereby terminated and each of the parties thereto
irrevocably terminates, releases and cancels all of its rights,
obligations, title and interest under such Prior Agreement against the
other party to such Prior Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
Dura Automotive Systems, Inc.
By: /s/ Xxxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: President and Chief Executive Officer
Dura Operating Corp.
By: /s/ Xxxxxxxx X. Xxxxxx
----------------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: President and Chief Executive Officer
"PARTICIPANT"
/s/ Xxxxx X. Xxxxx
--------------------------------------
Xxxxx X. Xxxxx
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