Amended and Restated Employment Agreement of Michael F. Johnston
Exhibit 10.13
THIS AGREEMENT, effective as of March 1, 2007, is made by and between Visteon
Corporation, a Delaware corporation, (“Visteon”) and Xxxxxxx X. Xxxxxxxx (the “Executive”).
WHEREAS, the Executive serves as the Chairman of the Board of Directors and Chief Executive
Officer of Visteon;
WHEREAS, the Executive has successfully supervised, managed and implemented a strategic and
structural reorganization of Visteon pursuant to a transaction with Ford Motor Company that
positions Visteon for future growth and success;
WHEREAS, Visteon desires, at this critical stage of Visteon’s development, to ensure the
continuity of the Executive’s leadership and management and to create an orderly process for
succession;
WHEREAS, Visteon and the Executive desire to amend the employment agreement between Visteon
and the Executive, dated September 15, 2000;
WHEREAS, the Executive is willing to commit himself to continue to serve as an employee of the
Company on the terms and conditions herein provided;
NOW, THEREFORE, in consideration of the premises and the material covenants herein contained,
Visteon and the Executive hereby agree as follows:
1. Employment. Visteon agrees to continue to employ the Executive as its Chairman of
the Board of Directors and Chief Executive Officer, and the Executive agrees to remain in such
employ upon the terms and conditions herein set forth. The place of employment shall be at
Visteon’s principal offices in Van Buren Township, Michigan, or at such other location as Visteon
may designate.
2. Term of Agreement. The term of this Agreement shall commence as of March 1, 2007
(the “Effective Date”) and shall continue in effect through December 31, 2008; provided,
however, that the parties may mutually agree to end the term before December 31, 2008.
3. Duties. Executive will, during the term hereof, faithfully and diligently do and
perform all duties and responsibilities as the Chief Executive Officer and Chairman of the Board of
Directors of Visteon, and such other acts and duties commensurate with such positions as the Board
of Directors shall direct, and do and perform all acts in the ordinary course of Visteon’s business
(with such limits as the Board may prescribe) necessary and conducive to Visteon’s best interests;
and devote his full time, energy and skill to the business of Visteon and to the promotion of
Visteon’s best interests.
4. Compensation. Subject to the provisions of paragraphs 7 and 8 of this Agreement,
Visteon shall pay to the Executive for all services to be performed during the term of this
Agreement:
(a) Annual Base Salary. An annual base salary of $1,400,000.00 (which may be
increased at the discretion of the Board of Directors of Visteon), payable in monthly
installments in accordance with Visteon’s practices, as such practices may be determined
from time to time.
(b) Long Term Incentive Compensation. For each fiscal year of Visteon
commencing during the Executive’s term of employment hereunder, the Executive shall be
entitled to a separate long term incentive compensation opportunity under Visteon’s 2004
Incentive Plan, and such opportunity at target performance shall be an amount equal to 475%
of annual base salary to be delivered as a combination of cash, restricted common
stock/restricted stock units and stock options/stock appreciation rights in accordance with
and based on achievement of Visteon financial and operation goals over a three-year
performance period. With respect to the 2007-2009 performance period, 66 percent of the
cash award portion (as determined by the Organization and Compensation Committee) of the
bonus opportunity shall be earned by reason of the Executive’s continuation of services
under this Agreement through December 31, 2008. With respect to the 2008-2010 performance
period, 33 percent of the cash award portion (as determined by the Organization and
Compensation Committee) of the bonus opportunity shall be earned by reason of the
Executive’s continuation of services under this Agreement through December 31, 2008. The
Executive shall be entitled to payment of the amount earned in respect of each performance
period that is not completed upon his termination of employment (other than by reason of
Cause) on or after December 31, 2008, or prior to December 31, 2008 if such termination is
by Visteon without Cause or upon mutual agreement of the parties, at the same time as awards
for such performance period are paid to other executives of Visteon.
(c) Grant of Restricted Stock Units or Stock Appreciation Rights. The
Executive shall be entitled to stock options, restricted stock and other equity-based awards
as and when such awards are made to other officers generally on at least the same basis as
such awards are made to other officers; provided, that the Executive shall not be entitled
to an equity award simply by reason of an equity award made to a newly hired or promoted
officer, or a single officer individually.
5. Benefits. The Executive shall be entitled to participate in such medical, dental,
pension, retirement plans and other benefit plans and programs (other than any severance plans) as
may be adopted from time to time by Visteon for the benefit of its employees (with the Executive
continuing to be credited with two years of service for every year of credited service with
Visteon). The Executive shall also be entitled to participate in Visteon’s company vehicle program
and a $60,000 per year flexible perquisite plan available to be used for financial planning, home
security, annual physical examination, club or exercise facility dues, or other purposes as may be
specified in the Company plan, as amended from time to time.
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6. Disability. In the event that the Executive is permanently disabled, as herein
defined, for a continuous period of six months, Visteon may terminate this Agreement upon written
notice to the Executive. In the event of such termination, the Executive’s compensation as defined
in paragraph 4 hereof shall continue for the lesser of (i) any waiting period set forth in any
disability insurance policy maintained by Visteon and covering the Executive, if any, or (ii) six
months after termination of this Agreement. For purposes of this paragraph, “permanently disabled”
shall mean a condition resulting from bodily injury or disease or mental disorder such that the
Executive is prevented from performing the principal duties of his employment. Visteon, in its
discretion, based on competent medical advice, shall determine whether the Executive is and
continues to be, permanently disabled for purposes of this paragraph.
7. Early Termination. This Agreement shall terminate upon the occurrence of any of
the following:
(a) On the date of death of the Executive;
(b) On the date that Visteon gives written notice to the Executive that Visteon is
terminating the Agreement pursuant to paragraph 6 hereunder;
(c) On the 90th day after the Executive gives written notice to Visteon of his election
to terminate; or
(d) On the second day after Visteon gives the Executive notice of a written
determination by its Board of Directors that the Executive is terminated by reason of Cause
(as defined below);
In the event of termination, and except as set forth in paragraph 6, the Executive (or his
estate) shall be entitled to the annual salary, to the extent unpaid, set forth in paragraph 4
hereof, prorated from January 1 of the year of termination to the date of termination.
The term “Cause” means that the Executive has been guilty of (i) material, willful
dishonesty, (ii) material, willful misconduct, (iii) willful and substantial nonperformance of
assigned duties, (iv) indicted for a felony or a misdemeanor involving moral turpitude, or (v) has
otherwise breached the terms of this Agreement.
8. Regular Termination. In the event the Executive remains employed under this
Agreement through December 31, 2008 or is terminated by the Company without Cause on or before such
date (and prior to a Change in Control, as such term is defined in the Change in Control Severance
Agreement between Visteon and the Executive), the Executive shall be entitled upon his termination
of employment (other than for Cause) on or after such date to (i) a lump-sum cash payment of
$2,500,000.00, which shall be made as soon as practicable, (ii) immediate and full vesting of all
outstanding equity awards granted to him by Visteon, and (iii) accrued and unpaid salary through
the date of termination. In the event that the parties mutually agree to end the term before
December 31, 2008, the Executive shall be entitled to a prorated amount of $2,500,000.00 based on
the Executive’s period of service from the Effective Date to the date of termination, with
immediate and full vesting of all outstanding equity awards granted
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to him by Visteon. For the avoidance of any doubt, if another individual is appointed with a
title of Chief Executive Officer, then such appointment shall be treated as a resignation of the
Executive by mutual agreement of the parties.
9. Restrictive Covenant. During the term of his employment by Visteon:
(a) The Executive will not engage in, or work for or own, manage, operate, control or
participate in the ownership, management, operation or control of, or be connected with, or
have any financial interest in, any individual, firm, or corporation or institution engaged
in the same or similar activities to those now or hereafter carried on by Visteon, other
than ownership of less than five percent of shares of stock in a publicly traded company;
(b) The Executive will not interfere with the relationship of Visteon and any employee,
agent or representative; and
(c) The Executive will not directly or indirectly divert or attempt to divert from
Visteon any business in which Visteon has been actively engaged during the term hereof, nor
interfere with the relationships of Visteon with dealers, distributors, sources of supply or
customers.
The provisions of this paragraph shall remain in force for one year following the termination of
this Agreement.
10. Confidentiality and Intellectual Property.
(a) While employed by Visteon, the Executive may generate or be exposed to trade
secret, confidential or proprietary information (hereinafter “Proprietary Information”)
including, but not limited to, inventions, future product plans, product designs, products
(including prices, costs, sales or content), drawings, details of Visteon’s operations or
marketing, computer programs, flow charts, customers (including identities of customers or
prospective customers and identities of individual contacts at business entities which are
customers or prospective customers), financial information or measures, business methods,
future business plans, data bases, designs, models, operating procedures, knowledge of the
organization, manufacturing processes, or any other work product of Visteon and all other
knowledge, information, documents or materials owned, developed or possessed by Visteon.
(b) While employed by Visteon, and for a period of ten years after completion of such
employment, the Executive agrees not to disclose, directly or indirectly, any Proprietary
Information in any unauthorized manner or for any unauthorized purpose outside of his duties
on behalf of Visteon. This obligation does not apply to such Proprietary Information which:
(a) is now or subsequently becomes publicly known or available by publication, commercial
use or otherwise without breach of this agreement by the Executive; (b) is subsequently
rightfully furnished to the Executive by a third
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person without restriction on disclosure; or (c) is delivered to the Executive after
the expiration of the employment with Visteon.
(c) Unless authorized by Visteon, the Executive will not remove from the premises of
Visteon any property or materials including any document or thing which comprises
Proprietary Information. Further, upon completion of this assignment or at any time upon
the request of Visteon, the Executive agrees to deliver to Visteon all property or materials
within the Executive’s possession or control including such documents and things which
contain Proprietary Information. The Executive covenants that he will destroy no records of
Visteon’s.
(d) The Executive agrees to assign all right, title and interest in any Proprietary
Information, whether patentable, copyrightable or not, which is conceived or developed
solely or jointly by the Executive while employed by Visteon and which relates in any manner
to the actual or any anticipated business of Visteon, or which was developed with the use of
time, materials, equipment or facilities of Visteon. Unless authorized by Visteon in
writing, the Executive will not pursue patenting or copyrighting any Proprietary
Information. Visteon will have sole ownership in and exclusive rights to all Proprietary
Information which is conceived or developed solely or jointly by the Executive while
employed by Visteon and which relates in any manner to the actual or any anticipated
business of Visteon, or which was developed with the use of time, materials, equipment or
facilities of Visteon. The Executive agrees to promptly disclose to Visteon any Proprietary
Information covered by this agreement and, if requested, promptly execute a specific
assignment of title to Visteon and/or a Visteon designee for such Proprietary Information.
The Executive agrees to take all reasonable actions necessary, even after the term of this
employment has ended to enable Visteon to secure such patent, copyright or other protection
in the United States or foreign countries. The Executive reserves no license to any
intellectual property rights.
(e) Any materials or software developed or created by the Executive relating to his
employment which are protectable under the laws of Copyright, including written or
electronic documents, illustrations, drawings, notes, models and computer software are to be
considered works made for hire for Visteon and are the sole property of Visteon if it so
fits within that definition in the Copyright Act. The Executive agrees to execute all forms
and documents relating to obtaining and enforcing copyright protection for such material for
the United States and any other countries, even after the term of employment has ended.
(f) The Executive has no right to use any trademarks owned by Visteon without the
express written authorization of Visteon.
The covenants set forth in this paragraph 10 which are made by the Executive are in
consideration of the employment, or continuing employment of, and the compensation paid to, the
Executive during his employment by Visteon.
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11. Stock Ownership Guidelines. The Executive acknowledges that Visteon expects the
Executive to maintain ownership in Visteon common stock at the level that had been required as of
the Effective Date, which was fives times his current base salary, but in no event shall the
Executive be expected to purchase additional shares of Visteon common stock to satisfy the
requirement.
12. Compliance with Code Section 409A. To the extent that there is a material risk
that any payments under this Agreement may not comply with the requirements of Section 409A of the
Code, the parties shall reasonably cooperate with each other to arrange such payments in a manner
that complies with Section 409A.
13. Additional Remedies. The Executive recognizes that irreparable injury will result
to Visteon and to its business and properties in the event of any breach by the Executive of any of
the provisions of paragraphs 9 and 10 of this Agreement or either of them, and that the Executive’s
continued employment is predicated on the commitments undertaken by him pursuant to said
paragraphs. In the event of any breach of any of the Executive’s commitments pursuant to
paragraphs 9 and 10 or either of them, Visteon shall be entitled, in addition to any other remedies
and damages available, to injunctive relief to restrain the violation of such commitments by the
Executive or by any person or persons acting for or with the Executive in any capacity whatsoever.
14. Nonassignment. This Agreement is personal to the Executive and shall not be
assigned. The Executive shall not hypothecate, delegate, encumber, alienate, transfer or otherwise
dispose of his rights and duties hereunder. Visteon may assign this Agreement without the
Executive’s consent to any other entity who, in connection with such assignment, acquires all or
substantially all of Visteon’s assets or into or with which Visteon is merged or consolidated.
15. Waiver. The waiver by Visteon of a breach by the Executive of any provision of
this Agreement shall not be construed as a waiver of any subsequent breach by the Executive.
16. Severability. If any clause, phrase, provision or portion of this Agreement or
the application thereof to any person or circumstance shall be invalid or unenforceable under any
applicable law, such event shall not affect or render invalid or unenforceable the remainder of
this Agreement and shall not affect the application of any clause, provision, or portion hereof to
other persons or circumstances.
17. Benefit. The provisions of this Agreement shall inure to the benefit of Visteon,
its successors and assigns, and shall be binding upon the Executive, his heirs, personal
representatives and successors, including without limitation the Executive’s estate and the
executors, administrators, or trustees of such estate.
18. Relevant Law. This Agreement shall be construed and enforced in accordance with
the laws of the State of Michigan.
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19. Notices. All notices, requests, demands and other communications in connection
with this Agreement shall be made in writing and shall be deemed to have been given when delivered
by hand or 48 hours after mailing at any general or branch United States Post Office, by registered
or certified mail, postage prepaid, return receipt requested, addressed as follows, or to such
other address as shall have been designated in writing by the addressee:
If to the Company:
Visteon Corporation
Xxx Xxxxxxx Xxxxxx Xxxxx
Xxx Xxxxx Xxxxxxxx, XX 00000
Attn: General Counsel and Secretary
Xxx Xxxxxxx Xxxxxx Xxxxx
Xxx Xxxxx Xxxxxxxx, XX 00000
Attn: General Counsel and Secretary
If to the Executive:
Xx. Xxxxxxx X. Xxxxxxxx
20. Entire Agreement. This Agreement, together with the existing Change in Control Agreement and Retiree Health Care Agreement in the form of Exhibits A and B attached hereto,
sets forth the entire understanding of the parties and supersedes all prior agreements,
arrangements, and communications, whether oral or written, pertaining to the subject matter hereof;
and this Agreement shall not be modified or amended except by written agreement of Visteon and the
Executive.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first set
forth above.
| Visteon Corporation |
||||
| By: | /s/ Xxxxxxx X. Xxxxxxxxxx | |||
| Xxxxxxx X. Xxxxxxxxxx | ||||
| Senior Vice President, Human Resources | ||||
| Executive |
||||
| /s/ Xxxxxxx X. Xxxxxxxx | ||||
| Xxxxxxx X. Xxxxxxxx | ||||
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