Exhibit 10-C
OTTER TAIL CORPORATION
EXECUTIVE EMPLOYMENT AGREEMENT
XXXXX XXXX
This Executive Employment Agreement (the "Agreement") is entered into as of
this 15th day of February, 2002, by and between Otter Tail Corporation, a
Minnesota corporation (the "Corporation") and Xxxxx Xxxx ("You"). The
Corporation agrees to employ You and You agree to be employed consistent with
the terms of this Agreement as follows:
1. Employment. The Corporation agrees to employ You and You agree to be
employed as Chief Financial Officer and Treasurer consistent with the terms and
conditions set forth in this Agreement.
2. Duties. You shall have such duties as are assigned or delegated to You
by the Corporation's Board of Directors or its designee. Except as provided for
in Section 7 of this Agreement or subsequently agreed upon by You and the
Corporation, You agree to devote Your entire business time, attention, skill,
and energy exclusively to the business of the Corporation, to use Your best
efforts to promote the success of the Corporation's business, and to cooperate
fully with the Board of Directors in the advancement of the best interests of
the Corporation.
3. Compensation and Benefits.
a. Base Pay. You shall be paid an annual salary ("Base Pay") of
$200,000, which shall be payable in equal periodic installments
according to the Corporation's customary payroll practices, but
no less frequently than monthly, and subject to such withholdings
and deductions as required by law. Your Base Pay shall be
reviewed in April of each year by the Board of Directors, and any
change in Base Pay approved by the Board shall become effective
April 1 of the year in which it is approved.
b. Incentive Compensation. You shall be paid an annual incentive
payment based on the Corporation's Management Incentive Plan, or
its successor plan, as approved by the Corporation's Board of
Directors, and based on the rules of the plan. Your incentive
payment shall be paid to You as soon as administratively possible
upon approval of the Corporation's financial results after the
close of each calendar year.
c. Benefits. In addition to the compensation described above and
subject to rules of eligibility, You shall be permitted to
participate in the benefit plans and long-term incentive plans
available to full time executive level employees of the
Corporation as they now exist and may from time to time be
modified or established by the Corporation. The plan documents
shall govern Your participation in any benefit plan.
4. Expenses. The Corporation shall pay Your dues in such professional
societies and organizations as are appropriate for Your position, and shall pay
on Your behalf (or reimburse You for) reasonable expenses incurred by You on
behalf of the Corporation in the
performance of the Your duties pursuant to this Agreement, including reasonable
expenses incurred by You in attending conventions, seminars, and other business
meetings, in appropriate business entertainment activities, and for promotional
expenses. You shall file such expense reports as are required by the
Corporation's policies and federal income tax laws and regulations.
5. Confidentiality of Information.
a. You acknowledge that the Corporation possesses and will continue
to develop and acquire valuable Confidential Information (as
defined below), including information that You may develop or
discover as a result of your employment with the Corporation. The
value of that Confidential Information depends on it remaining
confidential. The Corporation depends on You to maintain the
confidentiality, and You accept that position of trust.
b. As used in this Agreement, "Confidential Information" means any
information (including any formula, pattern, compilation,
program, device, method, technique or process) that derives
independent economic value, actual or potential, from not being
generally known to the public or to other persons who can obtain
economic value from its disclosure or use and includes
information of the Corporation, its customers, suppliers, joint
ventures, licensors, distributors and other persons and entities
with whom the Corporation does business.
c. You shall not disclose or use at any time, either during or after
your employment with the Corporation, any Confidential
Information except for the exclusive benefit of the Corporation
as required by your duties or as the Corporation expressly may
consent to in writing. You shall cooperate with the Corporation
to implement reasonable measures to maintain the secrecy of, and
use your best efforts to prevent the unauthorized disclosure, use
or reproduction of all Confidential Information.
d. Upon leaving employment with the Corporation for any reason, You
shall deliver to the Corporation all tangible, written,
graphical, machine readable and other materials (including all
copies) in your possession or under your control containing or
disclosing Confidential Information.
6. Termination/Severance. Either party may terminate the employment
relationship as evidenced by this Agreement at any time and for any reason upon
ninety days written notice to the other.
a. If You elect to terminate the employment relationship, or if You
are terminated by the Company for Cause, You shall receive Base
Pay and benefits through the date of termination. Cause means
your termination of employment with the Corporation based upon
embezzlement or other intentional misconduct which is materially
injurious to the Corporation, monetarily or otherwise.
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b. If the Corporation elects to terminate the employment
relationship or if You elect to resign for Good Reason, You shall
receive a severance payment equal to one and one-half (1-1/2)
times the sum of your present Base Pay plus your most recent
annual incentive payment (the "Severance Payment"), in full
satisfaction of the Corporation's obligations to You as an
employee. The Severance Payment will be paid within fifteen (15)
days of the date of termination and shall be subject to payroll
taxes and any withholding obligations. Good Reason means the
occurrence of any of the following events:
(1) a material change in your responsibilities or title which
are not of comparable responsibility and status as those
held upon execution of this Agreement;
(2) a reduction in your Base Pay, or a modification of the
Corporation's incentive compensation program or benefits in
a manner materially adverse to You;
(3) a breach or alteration of any material term of this contract
without your consent.
c. If You are terminated in connection with a Change in Control, as
defined by the Change in Control Severance Agreement entered into
by You and the Corporation (the "Severance Agreement"), and You
receive payment of the severance benefits under Section 4 of the
Severance Agreement, no Severance Payment shall be due to You
under this Agreement.
7. Special Considerations. None.
8. Entire Agreement. This Agreement and the Change in Control Severance
Agreement represent the entire agreement between You and the Corporation
concerning the employment relationship of the parties commencing on February 15,
2002 and following and, thus, supersedes any and all previous written or oral
employment agreements or understandings concerning such matter.
9. Disputes. Disputes under this Agreement shall be determined by
arbitration consistent with rules of the American Arbitration Association. The
costs of Arbitration shall be borne equally between You and the Corporation and
You shall bear your own attorney fees; provided, however, if You are the
prevailing party in Arbitration, all costs and attorney fees shall be paid by
the Corporation.
10. Amendment/Governing Law. This Agreement may only be modified or amended
by a writing signed by both parties. This Agreement is made in and shall be
governed by the substantive laws of the State of Minnesota.
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FOR THE CORPORATION:
/s/ Xxxx Xxxxxxxx 3-22-02
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Date
ACKNOWLEDGED AND ACCEPTED BY:
/s/ Xxxxx X. Xxxx 3/22/02
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Date
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