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EXHIBIT 10.22
EMPLOYMENT AND SEVERANCE AGREEMENT
This Employment and Severance Agreement (the "Agreement") entered into
this 1st day of February, 1995, by and between AGCO CORPORATION, a Delaware
corporation (the "Company"), and Xxxxx Xxxxxxx (the "Executive"),
witnesseth:
In consideration of the mutual covenants and agreements hereinafter set
forth, the Company and the Executive do hereby agree as follows:
1. EMPLOYMENT.
(a) The Company hereby employs the Executive and the Executive
hereby agrees to serve the Company on the terms and conditions set forth herein.
(b) The employment term shall commence on February 1, 1995 and
shall be for a term of three (3) years. Each year, at the end of the first year
of service and on the anniversary date of the end of the first year of service
under the Agreement, the Agreement shall be automatically extended for an
additional year, unless the Company notifies the Executive prior to the
anniversary date, in writing, that it desires to terminate the Agreement or
unless otherwise terminated earlier in accordance with Section 6 or any other
provision of the Agreement. The Company may terminate the Agreement in this
manner without cause. If the Executive is notified of the termination of the
Agreement, the Executive will continue similar service to the Company as
directed, and the Company shall pay the Executive his Base Salary (as defined in
Section 3(a) of the Agreement) then in effect and will continue the Executive's
group health and life insurance for the balance of the two (2) year period
remaining on the Agreement. If the Executive fails to perform similar duties as
directed by the Company or voluntarily terminates the availability of services
to accept other employment, the Company may cease payment of the Base Salary and
insurance coverage upon thirty (30) days written notice. In the event of notice
of termination without cause, the Company will reasonably
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cooperate with the Executive and not be unreasonable in providing the use of
facilities or free time for outplacement.
2. POSITION AND DUTIES.
The Executive shall serve as Vice President of Finance,
International Division, of the Company and shall perform such duties and
responsibilities as may from time to time be prescribed by the Company's board
of directors (the "Board"), provided that such duties and responsibilities are
consistent with the Executive's position. The Executive shall perform and
discharge faithfully, diligently and to the best of his/her ability such duties
and responsibilities and shall devote all of his/her working time and efforts to
the business and affairs of the Company and its affiliates.
3. COMPENSATION.
(a) BASE SALARY. The Company shall pay to the Executive an
annual base salary ("Base Salary") of One Hundred Thousand Dollars
($100,000.00), payable in equal semi-monthly installments throughout the term of
such employment subject to Sections 5 and 6 hereof and subject to applicable tax
and payroll deductions. The Company shall consider increases in the Executive's
Base Salary annually, and any such increase in salary implemented by the Company
shall become the Executive's Base Salary for purposes of this Agreement.
(b) INCENTIVE COMPENSATION. Provided Executive has duly
performed his/her obligations pursuant to this Agreement, the Executive shall be
entitled to participate in or receive benefits under the Management Incentive
Compensation Plan implemented by the Company.
(c) OTHER BENEFITS. During the term of this Agreement, the
Executive shall be entitled to participate in the Stock Option Plan implemented
by the Company and any employee benefit plans and arrangements which are
available to senior executive officers of the Company, including, without
limitation, group health and life insurance, pension and savings and the Senior
Management Employment Policy.
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(d) FRINGE BENEFITS. The Company shall pay or reimburse
Executive for all reasonable and necessary expenses incurred by him/her in
connection with his/her duties hereunder, upon submission by Executive to the
Company of such written evidence of such expense as the Company may require.
Throughout the term of this Agreement, the Company will provide Executive with
the use of a vehicle for purposes within the scope of his/her employment and
shall pay all expenses for fuel, maintenance and insurance in connection with
such use of the automobile. The Company further agrees that Executive shall be
entitled to four (4) weeks of vacation in any year of the term of employment
hereunder. Nothing paid to the Executive under any such Company plans or
arrangements shall be deemed to be in lieu of compensation to the Executive
hereunder.
4. NON-DISCLOSURE, NON-COMPETITION AND NON-SOLICITATION
COVENANTS.
(a) ACKNOWLEDGEMENTS. The Executive acknowledges that as
Vice President of Finance, International Division of the Company (i) he/she
frequently will be exposed to certain "Trade Secrets" and "Confidential
Information" of the Company (as those terms are defined in Subsection 4(b)),
(ii) his/her responsibilities on behalf of the Company will extend to all
geographical areas where the Company is doing business, and (iii) any
competitive activity on his/her part during the term of his employment and for a
reasonable period thereafter would necessarily involve his/her use of the
Company's Trade Secrets and Confidential Information and, therefore, would
unfairly threaten the Company's legitimate business interests, including its
substantial investment in the proprietary aspects of its business and the
goodwill associated with its customer base. Moreover, the Executive acknowledges
that, in the event of the termination of his/her employment with the Company,
he/she would have sufficient skills to find alternative, commensurate work in
his/her field of expertise that would not involve a violation of any of the
provisions of this Section 4. Therefore, the Executive acknowledges and agrees
that it is reasonable for the Company to require him/her to abide by the
covenants set forth in this Section 4. The parties acknowledge and agree that if
the nature of the Executive's responsibilities for or on behalf of the Company
and the geographical areas in which the Executive must fulfill them materially
change, the parties will execute appropriate amendments to the scope of the
covenants in this Section 4.
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(b) DEFINITIONS. For purposes of this Section 4, the following
terms shall have the following meanings:
(i) "COMPETITIVE POSITION" shall mean (i) the Executive's
direct or indirect equity ownership (excluding equity ownership of less than one
percent (1%) or control of all or any portion of a Competitor, or (ii) any
employment, consulting, partnership, advisory, directorship, agency, promotional
or independent contractor arrangement between the Executive and any Competitor
whereby the Executive is required to perform executive level services
substantially similar to those that he will perform for the Company as its Vice
President of Finance, International Division.
(ii) "COMPETITOR" of the Company shall refer to any person or
entity engaged, wholly or partly, in the business of manufacturing and
distributing farm equipment machinery and replacement parts.
(iii) "CONFIDENTIAL INFORMATION" shall mean the proprietary
and confidential data or information of the Company, other than "Trade Secrets"
(as defined below), which is of tangible or intangible value to the Company and
is not public information or is not generally known or available to the
Company's competitors.
(iv) "TRADE SECRETS" shall mean information of the Company,
including, but not limited to, technical or non-technical data, formulas,
patterns, compilations, programs, devices, methods, techniques, drawings,
processes, financial data, financial plans, products plans, or lists of actual
or potential customers or suppliers, which: (a) derives economic value, actual
or potential, from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can obtain economic value
from its disclosure or use; and (b) is the subject of efforts that are
reasonable under the circumstances to maintain its secrecy.
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(v) "WORK PRODUCT" shall mean all work product, property,
data, documentation, "know-how", concepts or plans, inventions, improvements,
techniques, processes or information of any kind, relating to the Company and
its business prepared, conceived, discovered, developed or created by the
Executive for the Company or any of the Company's customers.
(c) NONDISCLOSURE; OWNERSHIP OF PROPRIETARY PROPERTY
(i) The Executive hereby covenants and agrees that: (i) with
regard to information constituting a Trade Secret, at all times during the
Executive's employment with the Company and all times thereafter during which
such information continues to constitute a Trade Secret; and (ii) with regard to
any Confidential Information, at all times during the Executive's employment
with the Company and for three (3) years after the termination of the
Executive's employment with the Company, the Executive shall regard and treat
all information constituting a Trade Secret or Confidential Information as
strictly confidential and wholly owned by the Company and will not, for any
reason in any fashion, either directly or indirectly, use, sell, lend, lease,
distribute, license, give, transfer, assign, show, disclose, disseminate,
reproduce, copy, appropriate or otherwise communicate any such information to
any party for any purpose other than strictly in accordance with the express
terms of this Agreement and other than as may be required by law.
(ii) To the greatest extent possible, any Work Product shall
be deemed to be "work made for hire" (as defined in the Copyright Act, 17
U.S.C.A. ss. 101 et seq., as amended) and owned exclusively by the Company. The
Executive hereby unconditionally and irrevocably transfers and assigns to the
Company all rights, title and interest the Executive may currently have or in
the future may have by operation of law or otherwise in or to any Work Product,
including, without limitation, all patents, copyrights, trademarks, service
marks and other intellectual property rights. The Executive agrees to execute
and deliver to the Company any transfers, assignments, documents or other
instruments which the Company may deem necessary or appropriate to vest complete
title and ownership of any Work Product, and all rights therein, exclusively in
the Company.
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(iii) The Executive shall immediately notify the Company of
any intended or unintended, unauthorized disclosure or use of any Trade Secrets
or Confidential Information by the Executive or any other person of which the
Executive becomes aware. In addition to complying with the provisions of Section
4(c) (i) and 4 (c) (ii), the Executive shall exercise his best efforts to assist
the Company, to the extent the Company deems reasonably necessary, in the
procurement of any protection of the Company's rights to or in any of the Trade
Secrets or Confidential Information.
(iv) Immediately upon termination of the Executive's
employment with the Company, or at any point prior to or after that time upon
the specific request of the Company, the Executive shall return to the Company
all written or descriptive materials of any kind in the Executive's possession
or to which the Executive has access that constitute or contain any Confidential
Information or Trade Secrets, and the confidentiality obligations of this
Agreement shall continue until their expiration under the terms of this
Agreement.
(d) NON-COMPETITION. The Executive agrees that during the term of
his/her employment, he/she will not, either directly or indirectly, alone or in
conjunction with any other party, (i) accept or enter into a Competitive
Position with a Competitor of the Company, or (ii) take any action in
furtherance of or in conjunction with a Competitive Position with a Competitor
of the Company. The Executive agrees that for two (2) years after any
termination of his employment with the Company, he/she will not, in the
"Restricted Territory" (as defined in the next sentence), either directly or
indirectly, alone or in conjunction with any other party, (A) accept or enter
into a Competitive Position with a Competitor of the Company, or (B) take any
action in furtherance of or in conjunction with a Competitive Position with a
Competitor of the Company. For purposes of this Section 4, "Restricted
Territory" shall refer to all geographical areas comprised within the fifty
United States of America, Western Europe and Canada. The Executive and the
Company each acknowledge that the scope of the Restricted Territory is
reasonable because (1) the Company is conducting substantial business in all
fifty states (as well as several foreign countries), (2) the Executive occupies
one of the top executive positions with the Company, and (3) the
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Executive will be carrying out his employment responsibilities in all locations
where the Company is doing business.
(e) NON-SOLICITATION OF CUSTOMERS. The Executive agrees that
during the term of his/her employment, he/she will not, either directly or
indirectly, along or in conjunction with any other party, solicit, divert or
appropriate or attempt to solicit, divert or appropriate any customer or
actively sought prospective customer of the Company for or on behalf of any
Competitor of the Company. The Executive agrees that for two (2) years after any
termination of his employment with the Company, he/she will not, in the
Restricted Territory, either directly or indirectly, alone or in conjunction
with any other party, for or on behalf of a Competitor of the Company, solicit,
divert or appropriate or attempt to solicit, divert or appropriate any customer
or actively sought prospective customer of the Company with whom he had
substantial contact during a period of time of up to, but no longer than,
eighteen (18) months prior to any termination of his/her employment with the
Company.
(f) NON-SOLICITATION OF COMPANY PERSONNEL. The Executive agrees
that, except to the extent that he/she is required to do so in connection with
his/her express employment responsibilities on behalf of the Company, during the
term of his/her employment he/she will not, either directly or indirectly, alone
or in conjunction with any other party, solicit or attempt to solicit any
employee, consultant, contractor or other personnel of the Company to terminate,
alter or lessen that party's affiliation with the Company or to violate the
terms of any agreement or understanding between such employee, consultant,
contractor or other person and the Company. The Executive agrees that for two
(2) years after any termination of his/her employment with the Company, and in
the Restricted Territory, he/she will not, either directly or indirectly, alone
or in conjunction with any other party, solicit or attempt to solicit any
"material" or "key" (as those terms are defined in the next sentence) employee,
consultant, contractor or other personnel of the Company to terminate, alter or
lessen that party's affiliation with the Company or to violate the terms of any
agreement or understanding between such employee, consultant, contractor or
other person and the Company. For purposes of the preceding sentence, "material"
or "key" employees, consultants, contractors or other
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personnel of the Company are those who have access to the Company's Trade
Secrets and Confidential Information and whose position or affiliation with the
Company is significant.
(g) REMEDIES. Executive agrees that damages at law for the
Executive's violation of any of the covenants in this Section 4 would not be an
adequate or proper remedy and that should the Executive violate or threaten to
violate any of the provisions of such covenants, the Company or its successors
or assigns shall be entitled to obtain a temporary or permanent injunction
against Executive in any court having jurisdiction prohibiting any further
violation of any such covenants, in addition to any award or damages,
compensatory, exemplary or otherwise, for such violation, if any.
(h) PARTIAL ENFORCEMENT. The Company has attempted to limit
the rights of the Executive to compete only to the extent necessary to protect
the Company from unfair competition. The Company, however, agrees that, if the
scope of enforceability of these restrictive covenants is in any way disputed at
any time, a court or other trier of fact may modify and enforce the covenant to
the extent that it believes to be reasonable under the circumstances existing at
the time.
5. SEVERANCE.
(a) CHANGE IN CONTROL. In order to induce the Executive to
remain in the employ of the Company, the Executive is provided the severance
benefits set forth in this Section 5, in the event the Executive's employment
with the Company is terminated subsequent to a change in control under the
circumstances described below. In exchange for the severance benefits the
Executive agrees that in the event of a Change in Control (as defined in
Subsection (f) below), the Executive will not voluntarily terminate his
employment with the Company until thirty (30) days after the Change in Control.
(b) SEVERANCE BENEFITS. No benefits shall be payable under
this Section 5 unless there shall have been a Change in Control. In the event a
Change in Control occurs, the Executive is entitled to the following benefits
upon any subsequent termination of the Executive's employment within two (2)
years from the date of such Change in Control, unless such termination is (a)
because of the death or Incapacity (as
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defined in Section 6(b) below) of the Executive, (b) by the Company for Cause
(as defined in Subsection (f) below), (c) by the Executive other than for Good
Reason (as defined in Subsection (f) below) or (d) upon the Executive's
voluntary retirement.
(i) The Company shall pay the Executive within thirty
(30) days of the date of termination (subject to Subsection (ii) below)
an amount in cash equal to three times the Executive's Annual Base
Compensation (as defined in Subsection (f) below; provided that in no
event shall the amount payable pursuant to this Section 5, when added
to any other payments which are deemed to be "parachute payments" as
defined in Section 280G of the Internal Revenue Code, as amended (and
as hereafter amended) (the "Code"), equal or exceed three (3) times the
Executive's "base amount" as determined pursuant to Section 280G of the
Code for purposes of any excise tax under Section 4999 of the Code. The
foregoing shall be calculated and determined by Xxxxxx Xxxxxxxx & Co.
or such other nationally recognized independent accounting firm as may
be mutually acceptable to the Company and the Executive hereafter. In
all events and notwithstanding anything herein to the contrary, any
amounts payable under this Section 5, when taken together with the
present value of all other payments in the nature of compensation to
the Executive which are contingent on a Change in Control, shall be
reduced by the smallest amount necessary to reduce the aggregate amount
of all such payments to an amount equal to three (3) times such base
amount less One Dollar ($1.00).
(ii) The Executive may elect by written notice given to
the Company prior to a Change in Control to receive all or any portion
of the payments to which the Executive is entitled to receive as
described above in one or more installment payments at such time or
times as the Executive shall specify in the written notice, together
with interest thereon calculated at a rate of interest equal to the
prime rate of Chemical Bank of NYC as in effect from time to time from
the date of termination.
(iii) The Company shall continue to cover the Executive
under, or provide the Executive with insurance coverage no less
favorable than, the life, disability and health benefit plans
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which are provided to the Company's then-current, similarly situated
Executives for a period equal to the lesser of (X) three (3) years
following the date of termination, or (Y) until the Executive is
provided benefits by another employer substantially comparable to the
benefits provided by the Company.
(iv) In the event of the Executive's death subsequent to
termination, all payments or benefits to which the Executive is
entitled under this Section 5 shall be paid to the Executive's
designated beneficiary or beneficiaries or, if none are designated, to
the Executive's estate.
(v) All payments and benefits to which the Executive is
entitled under this Section 5 shall be made and provided without
offset, deduction or mitigation on account of income the Executive may
receive from other employment or otherwise.
(vi) All payments and benefits due or required to be made
or provided in the future to the Executive under this Section 5 shall
become immediately due and payable without further notice or demand,
upon the occurrence of any Event of Acceleration.
The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business of the Company, by agreement satisfactory to the Executive, to
expressly assume and agree to perform the terms of this Section 5 in the same
manner and to the same extent that the Company would be required to perform if
no such succession had taken place. The provisions of this Section 5 shall
continue to apply to each subsequent successor.
(c) The Company shall pay all of the costs and expenses, including
all attorneys' fees and disbursements, at least monthly, in connection with any
disputes, legal proceedings, arbitrations or other conflicts, whether or not
instituted by the Company or the Executive relating to the interpretation or
enforcement of any provision of this Xxxxxxx.
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(x) XXXXXX. This Section 5 is not intended and shall not be deemed
to guarantee the Executive of any term of employment with the Company but only
to designate the severance benefits the Executive is entitled to under the
circumstances set forth in this Section 5. Moreover, this Section 5 is not
intended to and shall not effect, limit or terminate any other agreement or
arrangement between the Executive and the Company presently in effect or entered
into hereafter.
(e) EXCLUSIVE REMEDY. The Executive and the Company acknowledge
and agree that in the event the Executive receives compensation under this
Section 5, the Company shall be relieved of any and all other obligations under
this Agreement except for full compliance with the terms of this Section 5. By
way of illustration and not limitation, if the Executive's employment is
terminated in connection with a Change in Control the Company would pay the
Executive severance benefits pursuant to the terms of this Section 5 and would
not be obligated to the Executive for continuation of the Executive's employment
pursuant to Section 2 or payment under Section 6(e) below.
(f) DEFINITIONS. As used in this Section 5, the following
capitalized terms have the meaning indicated below:
(i) "ANNUAL BASE COMPENSATION" shall mean the Executive's
annualized includable compensation for the base period as defined,
discussed and illustrated in Section 280G of the Code and the duly
promulgated Treasury Regulations thereunder.
(ii) "CAUSE" shall be defined as set forth in Section
6(c) below.
(iii) "CHANGE IN CONTROL" shall mean changes in the
ownership of a corporation, changes in the effective control of a
corporation and changes in ownership of a substantial portion of a
corporation's assets all as defined, discussed and illustrated in
Section 280G of the Code and the duly promulgated Treasury Regulations
thereunder and specifically Q-27, Q-28 and Q-29
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respectively of proposed Treasury Regulation Section 1.280G-1. Without
limiting the foregoing and by way of example:
(A) A change in the ownership of a corporation occurs on the
date that any one person, or more than one person acting as a group,
acquires ownership of stock of that corporation that, together with
stock held by such person or group, possess more than fifty percent
(50%) of the total fair market value or total voting power of
the stock of such corporation. However, if any one person, or more than
one person acting as a group, is considered to own more than fifty
percent (50%) of the total fair market value or total voting power of
the stock of a corporation, the acquisition of additional stock by the
same person or persons is not considered to cause a change in the
ownership of the corporation. An increase in the percentage of stock
owned by any one person, or persons acting as a group, as a result of a
transaction in which the corporation acquires its stock in exchange for
property will be treated as an acquisition of stock.
(B) A change in the effective control of a corporation is
presumed (which presumption may be rebutted) to occur on the date that
either: any one person, or more than one person acting as a group,
acquires (or has acquired during the twelve (12)-month period ending on
the date of the most recent acquisition by such person or persons)
ownership of stock of the corporation possessing twenty percent (20%)
or more of the total voting power of the stock of such corporation; or
a majority of members of the corporation's board of directors is
replaced during any twenty four (24)-month period by directors whose
appointment or election is not endorsed by a majority of the members of
the corporation's board of directors prior to the date of the
appointment or election of such new directors.
(C) A change in the ownership of a substantial portion of a
corporation's assets occurs on the date that any one person, or more
than one person acting as a group, acquires (or has acquired during the
twelve (12) month period ending on the date of the most
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recent acquisition by such person or persons) assets from the
corporation that have a total fair market value equal to or more than
one-third of the total fair market value of all of the assets of the
corporation immediately prior to such acquisition or acquisitions. The
transfer of assets by a corporation is not treated as a change in the
ownership of such assets if the assets are transferred to: a
shareholder of the corporation (immediately before the asset transfer)
in exchange for or with respect to its stock; an entity, fifty percent
(50%) or more of the total value or voting power of which is owned,
directly or indirectly by the corporation; a person, or more than one
person acting as a group, that owns, directly or indirectly, fifty
percent (50%) or more of the total value or voting power of all of the
outstanding stock of the corporation; or an entity, at least fifty
percent (50%) of the total value or voting power is owned, directly or
indirectly, by a person, or more than one person acting as a group,
that owns directly or indirectly, fifty percent (50%) or more of the
total value of voting power of all of the outstanding stock of the
corporation.
(iv) "EVENT OF ACCELERATION" SHALL MEAN:
(A) The failure of the Company to make any
payment or provide any benefit to which the Executive is
entitled under this Agreement when due or as accelerated,
which failure continues thirty (30) days after the due date
thereof; or
(B) The failure by the Company to obtain the
assumption of the agreement to perform this Agreement by any
successor as contemplated herein; or
(C) A decrease by more than forty percent
(40%) within any two (2) year period of the book value of the
net assets of the Company and its subsidiaries, taken as a
whole; or
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(D) The filing of a petition by or against
the Company for adjudication as a bankrupt under the Federal
Bankruptcy Act, or for reorganization, or the filing of any
petitions for similar relief; the commencement of any action
or proceeding for the appointment of a receiver or a trustee
of all or substantially all of the property of the Company;
the taking or possession of any property of the Company by any
governmental or judicial officer or agency pursuant to
statutory authority for the dissolution, rehabilitation,
reorganization, or liquidation of the Company; the dissolution
or commencement of any action or proceeding, whether voluntary
or involuntary, for the dissolution or liquidation of the
Company; or the making by the Company of an assignment for the
benefit of creditors; provided that the Company shall have
ninety (90) days within which to affect the dismissal of any
involuntary proceedings of a type referred to above that is
commenced against it.
(v) "GOOD REASON" shall mean, without the written consent of
the Executive:
(A) A reduction in the Executive's base salary or a
reduction in the Executive's benefits received from the
Company other than in connection with an across the board
reduction in salaries and/or benefits for similarly situated
employees of the Company or pursuant to the Company's standard
retirement policy; or
(B) The relocation of the Executive's full time
office to a location greater than fifty (50) miles from the
Company's current corporate office; or
(C) A reduction in the Executive's corporate title or
duties; or
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(D) A material breach by the Company of this
Agreement.
(vi) "NORMAL RETIREMENT DATE" shall mean the first day of the
month coincident with or next following the Executive's sixty-fifth
(65th) birthday.
6. TERMINATION.
(A) DEATH. The Executive's employment hereunder shall
terminate upon the death of the Executive, provided, however, that for purposes
of the payment of compensation and benefits to the Executive under this
Agreement the death of the Executive shall be deemed to have occurred ninety
(90) days from the last day of the month in which the death of the Executive
shall have occurred.
(b) INCAPACITY. The Company may terminate the Executive's
employment hereunder at the end of any calendar month by giving written Notice
of Termination to the Executive in the event of the Executive's incapacity due
to physical or mental illness which prevents the proper performance of the
duties of the Executive set forth herein or established pursuant hereto for a
substantial portion of any six (6) month period of the Executive's term of
employment hereunder. Any question as to the existence, extent or potentiality
of illness or incapacity of Executive upon which Company and Executive cannot
agree shall be determined by a qualified independent physician selected by the
Company and approved by Executive (or, if Executive is unable to give such
approval, by any adult member of the immediate family or the duty appointed
guardian of the Executive). The determination of such physician certified in
writing to the Company and to Executive shall be final and conclusive for all
purposes of this Agreement.
(c) CAUSE. The Company may terminate the Executive's
employment hereunder for Cause by giving written Notice of Termination to the
Executive. For the purposes of this Agreement, the Company shall have "Cause" to
terminate the Executive's employment hereunder upon the Executive's (i) habitual
drunkenness or willful failure materially to perform and discharge the duties
and responsibilities of the Executive hereunder or any breach of the Executive
of the provisions of Section 4 hereof, or (ii)
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misconduct that is materially injurious to the Company or (iii) conviction of a
felony involving the personal dishonesty of the Executive or moral turpitude.
(d) NOTICE OF TERMINATION. Any termination by the Company pursuant to
the Subsections (b) or (c) above shall be communicated by written Notice of
Termination to the Executive. For purposes of this Agreement, a "Notice of
Termination" shall mean a notice which shall indicate the specific termination
provision of this Agreement relied upon and shall set forth in reasonable
detail the facts and circumstances claimed to provide a basis for such
termination. A date of termination specified in Notice of Termination shall not
be dated earlier than ninety (90) days from the date such Notice is delivered
or mailed to the Executive.
(e) Obligation to Pay. Except upon voluntary termination by the
Executive or termination of the Executive's employment in connection with a
Change in Control (in which case Section 5 shall govern) and subject to Section
7 below, the Company shall pay the compensation specified in this Agreement to
the Executive for the remainder of the term set forth in Section l(b) or for
the period specified in this Subsection 6 (e), whichever period is the lesser.
The Company also will continue insurance benefits during the remainder of the
term set forth in Section l(b). If the Executive's employment shall be
terminated by reason of death, the estate of the Executive shall be paid all
sums otherwise payable to The Executive through the end of the third month
after the month in which the death of the Executive occurred and all bonus or
other incentive benefits accrued or accruable to the Executive through the end
of the month in which the death of the Executive occurred and the Company shall
have no further obligations to the Executive under this Agreement. If the
Executive's employment is terminated by reason of incapacity, the Executive or
the person charged with legal responsibility for the Executive's estate shall
be paid all sums otherwise payable to the Executive, including the bonus and
other benefits accrued or accruable to the Executive, through the date of
termination specified in the Notice of Termination, and the Company shall have
no further obligations to the Executive under this Agreement. If the
Executive's employment shall be terminated for Cause, the Company shall pay the
Executive his Base Salary through the date of termination
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specified in the Notice of Termination and the Company shall have no further
obligations to the Executive under this Agreement.
7. Effect of Re-Employment/Other Compensation.
(a) If at any time after the termination of the Executive's
employment, the Company is continuing to pay benefits to the Executive pursuant
to Section 6(e) above, and the Executive enters into new employment with a
party other than the Company ("Re-Employment"), the Executive shall immediately
notify the Company in writing of the Executive's monthly compensation to be
received from such Re-Employment and any insurance coverage provided pursuant
thereto, and the following provisions shall apply:
(i) If the Executive's monthly compensation from Re-Employment is
equal to or in excess of the compensation being paid by the Company, the
Company shall promptly pay the Executive, in full satisfaction of all
obligations to compensate the Executive under Section 6(e), an amount equal
to fifty percent (50%) of Company's remaining compensation obligation.
Notwithstanding anything herein to the contrary and except for the
obligations in Subsection (b) below, upon payment by the Company of the
amounts set forth in this Section 7(a)(i), the Company shall cease to have
any obligation under Section 6(e) of this Agreement.
(ii) If the Executive's monthly compensation from Re-Employment is
less than the compensation being paid by the Company, compensation payable
to the Executive shall automatically be reduced by the amount of the
Executive's monthly compensation from Re-Employment provided, however, that
at the end of the Company's obligations to pay under Section 6(e) it shall
pay the Executive an amount equal to 100 percent (100%) of the remainder of:
(A) total compensation obligations of the Company under Section 6(e) less
(b) the actual compensation paid the Executive during the post-termination
period. Notwithstanding anything herein to the contrary and except for the
obligations in Subsection (b) below, upon payment of the final payment the
Company shall cease to have any obligations under this Agreement. The
Executive shall immediately notify the Company of any change in the level of
compensation received from Re-Employment and, if
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such compensation increases to a level equal to or in excess of the
compensation being paid by the Company, the provisions of Section 7
(a)(i) shall then apply.
(b) Provided COBRA requirements have been met, the
Company's obligation to provide insurance coverage to the Executive under
Section 3(c) or Section 5(b)(iii) hereof shall terminate as to any specific
coverage if and when comparable coverage is made available to the Executive in
connection with Re-Employment.
8. NOTICES. For the purpose of this Agreement, notices and all other
communications to either party hereunder provided for in the Agreement shall be
in writing and shall be deemed to have been duly given when delivered in person
or mailed by certified first-class mail, postage prepaid, addressed:
in the case of the Company to:
AGCO Corporation
0000 Xxxxx Xxxxx Xxxxxxx
Xxxxxx, Xxxxxxx 00000
Attention: X. X. Xxxxxxx
in the case of the Executive to:
Xxxxx Xxxxxxx
00 Xxxxxx Xxxx
Xxxxxxxxxxx Xxx
Xxxxxxxxxxxx Xxxxxxx
or to such other address as either party shall designate by giving written
notice of such change to the other party.
9. ARBITRATION. Any claim, controversy, or dispute arising between
the parties with respect to this Agreement, to the maximum extent allowed by
applicable law, shall be submitted to and resolved by binding arbitration. The
arbitration shall be conducted pursuant to the terms of the Federal Arbitration
Act
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and (except as otherwise specified herein) the Commercial Arbitration Rules of
the American Arbitration Association in effect at the time the arbitration is
commenced. The venue for the arbitration shall be the Atlanta, Georgia offices
of the American Arbitration Association. Either party may notify the other
party at any time of the existence of an arbitrable controversy by delivery in
person or by certified mail of a Notice of Arbitrable Controversy. Upon receipt
of such a Notice, the parties shall attempt in good faith to resolve their
differences within fifteen (15) days after the receipt of such Notice. Notice
to the Company and the Executive shall be sent to the addresses specified in
Section 8 above. If the dispute cannot be resolved within the fifteen (15) day
period, either party may file a written Demand for Arbitration with the
American Arbitration Association's Atlanta, Georgia Regional Office, and shall
send a copy of the Demand for Arbitration to the other party. The arbitration
shall be conducted before a panel of three (3) arbitrators. The arbitrators
shall be selected as follows: (a) The party filing the Demand for Arbitration
shall simultaneously specify his or its arbitrator, giving the name, address
and telephone number of said arbitrator, (b) The party receiving such notice
shall notify the party demanding the arbitration of his or its arbitrator,
giving the name, address and telephone number of the arbitrator within five (5)
days of the receipt of such Demand for Arbitration; (c) A neutral person shall
be selected through the American Arbitration Association's arbitrator selection
procedures to serve as the third arbitrator. The arbitrator designated by any
party need not be neutral. In the event that any person fails or refuses timely
to name his arbitrator within the time specified in this Section 9, the
American Arbitration Association shall (immediately upon notice from the other
party) appoint an arbitrator. The arbitrators thus constituted shall promptly
meet, select a chairperson, fix the time, date(s), and place of the hearing,
and notify the parties. To the extent practical, the arbitrators shall schedule
the hearing to commence within sixty (60) days after the arbitrators have been
impaneled. A majority of the panel shall render an award within ten (10) days
of the completion of the hearing, which award may include an award of interest,
legal fees and costs of arbitration. The panel of arbitrators shall promptly
transmit an executed copy of the award to the respective parties. The award of
the arbitrators shall be final binding and conclusive upon the parties hereto.
Each party shall have the right to have the award enforced by any court of
competent jurisdiction.
Executive initials: /S/ CP Company initials: /S/ RJR
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10. NO WAIVER. No provision of this Agreement may be modified, waived
or discharged unless such waiver, modification or discharge is approved by the
Board and agreed to in a writing signed by the Executive and such officer as
may be specifically authorized by the Board. No waiver by either party hereto
at any time of any breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of any other provisions or conditions of this
Agreement at the same or at any prior or subsequent time.
11. SUCCESSORS AND ASSIGNS. The rights and obligations of the Company
under this Agreement shall inure to the benefit of and be binding upon the
successors and assigns of the Company and the Executive's rights under this
Agreement shall inure to the benefit of and be binding upon his heirs and
executors. Neither this Agreement or any rights or obligations of the Executive
herein shall be transferable or assignable by the Executive.
12. VALIDITY. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provisions of this Agreement, which shall remain in full force and
effect. The parties intend for each of the covenants contained in Section 4 to
be severable from one another.
13. SURVIVAL. The provisions of Section 4 hereof shall survive the
termination of Executive's employment and shall be binding upon the Executive's
personal or legal representative, executors, administrators, successors, heirs,
distributee, devisees and legatees and the provisions of Sections 5 and 6
hereof relating to payments and termination of the Executive's employment
hereunder shall survive such termination and shall be binding upon the Company.
14. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
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15. ENTIRE AGREEMENT. This Agreement constitutes the full agreement
and understanding of the parties hereto with respect to the subject matter
hereof and all prior or contemporaneous agreements or understandings are merged
herein. The parties to this Agreement each acknowledge that both of them and
their respective agents and advisors were active in the negotiation and
drafting of the terms of this Agreement.
16. GOVERNING LAW. The validity, construction and enforcement of this
Agreement, and the determination of the rights and duties of the parties
hereto, shall be governed by the laws of the State of Georgia.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
AGCO CORPORATION
By: /s/ X.X. Xxxxxxx
-----------------------
Name: X.X. Xxxxxxx
---------------------
Title: Chairman
--------------------
EXECUTIVE
/s/ Xxxxx X. Xxxxxxx
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AMENDMENT TO EMPLOYMENT AND SEVERANCE AGREEMENT
This Agreement is to amend the Employment and Severance Agreement
(the "Agreement") between AGCO Corporation, a Delaware corporation, (the
"Company") and Xxxxx X. Xxxxxxx, (the "Executive"), dated February 1, 1995.
Section 5 of the Agreement is amended to add Section 5 (g) as
follows:
(g) Long Term Incentive and Other Stock Plans. In the event of a
Change In Control (as defined in Subsection (f) above), the Company
will require any successor to fulfill the terms and conditions of the
Long Term Incentive Plans and any Stock Option Plans previously
provided to the Executive in the same manner and to the same extent
that the Company would be required to perform if no such succession
had taken place. However, effective with the Change in Control, the
Executive will be immediately vested for all shares earned under the
Long Term Incentive Plans and for those shares awarded under any
Stock Option Plan.
AGCO Corporation Executive
By: /s/ Xxxxx X. Xxxxxxx /s/ Xxxxx X. Xxxxxxx
------------------------- ------------------------------
Title: President Xxxxx X. Xxxxxxx
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