Exhibit 10(p)
FORM OF AGREEMENT
This AGREEMENT ("Agreement"), is made as of the ____ day of ____________,
20--, between INVACARE CORPORATION, an Ohio corporation ("Invacare"), and
____________ (the "Executive").
Invacare is entering into this Agreement in recognition of the importance
of the Executive's services to the continuity of management of Invacare and
based upon its determination that it will be in the best interests of Invacare
to encourage the Executive's continued attention and dedication to the
Executive's duties in the potentially disruptive circumstances of a possible
Change of Control of Invacare. (As used in this Agreement, the term "Change of
Control" and certain other capitalized terms have the meanings ascribed to them
in Section 9 hereof.)
Invacare and the Executive agree, effective as of the date first set forth
above (the "Effective Date"), as follows:
1. Retention Bonus if Executive is Employed by Invacare on First
Anniversary of the Date of a Change of Control. If, following the occurrence of
a Change of Control, the Executive continues to be employed by Invacare on the
first anniversary of the date of the Change of Control, Invacare shall pay to
the Executive, within ten business days after such first anniversary, a lump-sum
amount equal to the sum of (a) the Executive's Annual Base Salary plus (b) the
Executive's Target Bonus.
2. Severance Benefits if Employment is Terminated in Certain Circumstances
Within Three Years of a Change of Control. If, within three years following the
occurrence of a Change of Control, the Executive's employment with Invacare is
terminated by Invacare for any reason other than Cause, Disability, or death, or
by the Executive for Good Reason, this Section 2 shall become applicable and
Invacare shall pay to the Executive the amounts specified in Sections 2.1, 2.2,
and 2.3 on the dates indicated therein and shall provide to the Executive the
benefits specified in Sections 2.4, 2.5, 2.6, and 2.7 for the respective periods
specified therein, and shall cause certain rights of the Executive to vest as
provided in Sections 2.7 and 2.8.
2.1 Lump Sum Severance Benefit. Invacare shall pay to the Executive, within
ten business days after the Termination Date, a lump sum severance benefit equal
to (a) minus (b) below where:
(a) equals three times the sum of (i) the Executive's Annual Base
Salary plus (ii) the Executive's Target Bonus; and
(b) equals the amount, if any, paid to the Executive pursuant to
Section 1 above.
2.2 401(k) Profit Sharing. Invacare shall pay to the Executive, within 60
days after the Termination Date, a lump sum amount equal to three times the
highest amount of total contributions (including both matching contributions and
Profit Sharing Contributions) made by Invacare to the Invacare 401(k) Profit
Sharing Plan with respect to the Executive for any single plan year ending on or
after the date that is three years before the date of the Change of Control.
2.3 SERP. Invacare shall pay to the Executive, within 60 days after the
Termination Date, a lump sum amount equal to the amount by which (a) the
actuarial equivalent of the annual SERP Benefit that would have been payable
under Section 6.7 of the Invacare Supplemental Executive Retirement Plan,
as in effect on the Termination Date, calculated as though the Executive had
continued in the employ of Invacare through the third anniversary of the
Termination Date with annual compensation for each of those three years equal to
the highest annual compensation received by the Executive from Invacare during
any year ending on or after the date that is three years before the date of the
Change of Control, exceeds (b) the actuarial equivalent of the annual SERP
Benefit that is payable under that Section 6.7 taking into account only
Executive's employment with Invacare through the Termination Date.
2.4 Insurance Benefits. Invacare shall provide to the Executive, from the
Termination Date through the third anniversary of the Termination Date,
continuing coverage under health, life, and disability insurance programs at
least equal in all respects to the highest level of such coverage provided by
Invacare to the Executive at any time during the period beginning one year
before the Change in Control and ending on the Termination Date.
2.5 Club Dues. During the period from the Termination Date through the
third anniversary of the Termination Date, Invacare shall continue to reimburse
the Executive for club dues on at least as favorable basis as the most favorable
basis in effect at any time during the period beginning one year before the
Change of Control and ending on the Termination Date.
2.6 Automobile. During the period from the Termination Date through the
third anniversary of the Termination Date, Invacare shall continue to provide to
the Executive an automobile (and reimbursement for mileage, maintenance,
insurance, repairs, and similar items) on at least as favorable basis as the
most favorable basis in effect at any time during the period beginning one year
before the Change of Control and ending on the Termination Date.
2.7 Stock Options. In respect of all options to purchase Invacare stock
that have been previously granted to the Executive pursuant to any stock option
plan or arrangement sponsored by Invacare, and notwithstanding any other
provision to the contrary contained in any stock option plan or arrangement,
Invacare shall cause such options:
(a) to become exercisable in full as of the Termination Date; and
(b) to continue to be exercisable until the earlier to occur of the
second anniversary of the Termination Date or the expiration date of the
option; and
(c) to be exercisable (and/or to satisfy any tax withholding
requirements in connection with the exercise of the options) using shares
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of Invacare common stock previously owned by the Executive and/or shares
subject to the options being exercised as consideration in lieu of a cash
payment or other arrangement, but only if any such exercise of the option
would not result in Invacare being required to take a charge in respect of
such exercise in determining its net income for financial accounting
purposes.
2.8 Vesting of Certain Rights. Invacare shall cause the Executive's rights
under (a) the Invacare 401(k) Profit Sharing Plan, and (b) the Invacare
Supplemental Executive Retirement Plan, to become, as of the Termination Date,
immediately vested.
2.9 Death of the Executive. In the event of the Executive's death at any
time from the Termination Date through the third anniversary of the Termination
Date, then, assuming any applicable conditions precedent set forth above are
satisfied:
(a) the amount described in Section 1, to the extent not paid to the
Executive, shall be paid to the Beneficiary as soon as practicable
following the Executive's death;
(b) the amount described in Section 2.1, to the extent not paid to the
Executive, shall be paid to the Beneficiary as soon as practicable
following the Executive's death;
(c) the amount described in Section 2.2, to the extent not paid to the
Executive, shall be paid to the Beneficiary as soon as practicable
following the Executive's death;
(d) the amount described in Section 2.3, to the extent not paid to the
Executive, shall be paid to the Beneficiary as soon as practicable
following the Executive's death;
(e) any person who would have been entitled to coverage as the
Executive's dependent (or otherwise because of the Executive's coverage)
under any health insurance program maintained by Invacare (as described in
Section 2.4) shall continue to be provided with such coverage as though the
Executive had survived through the third anniversary of the Termination
Date;
(f) the benefits described in Sections 2.5 and 2.6 shall cease to be
provided on the first to occur of either (i) the 60th day following the
Executive's death or (ii) the third anniversary of the Termination Date;
(g) such persons as may be entitled thereto shall receive such
benefits as may be provided under any Employee Benefit Plans in accordance
with the terms of such Employee Benefit Plans;
(h) such persons as may be entitled thereto shall receive such
benefits as may be provided under any other agreement the Executive may
have with Invacare or an Affiliate including, without limitation, any
agreement relating to options to purchase Invacare stock.
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2.10 Alternate Form of Benefit. Notwithstanding the preceding provisions of
this Section 2, to the extent the Executive cannot, as a matter of law, or
pursuant to the customs or policies of any insurance underwriter, realize any
benefit or advantage described above in this Section 2, or if Invacare
reasonably believes that providing the Executive with any such benefit or
advantage would be economically disadvantageous because doing so would cause
Invacare to lose tax or other benefits, Invacare shall notify the Executive and
shall pay to the Executive an additional amount which shall, taking account of
any federal, state and local income taxes incurred by the Executive in respect
of such payments, place the Executive in the same position, on an after-tax
basis, as though he had realized such benefit or advantage; provided, further,
that the amount of any payment to the Executive pursuant to the preceding clause
shall be calculated at the Company's cost and expense by the Accounting Firm,
and its determination of such amount shall be final and binding upon both the
Executive and Invacare, and the Executive and Invacare shall each provide the
Accounting Firm with such information as it may reasonably request in order to
calculate any such amount.
3. Excess Parachute Payment Gross-Up.
3.1 Potential for Excess Parachute Payments. Invacare and the Executive
acknowledge that, following a Change of Control, one or more payments or
distributions to be made by Invacare to or for the benefit of the Executive
(whether paid or payable or distributed or distributable pursuant to the terms
of this Agreement, under some other plan, agreement, or arrangement, or
otherwise) (a "Payment") may be determined to be an "excess parachute payment"
that is not deductible by Invacare for Federal income tax purposes and with
respect to which the Executive will be subject to an excise tax because of
Sections 28OG and 4999, respectively, of the Internal Revenue Code. If benefits
become payable to the Executive under Sections 1 or 2 of this Agreement, the
Accounting Firm, which shall make all determinations required to be made under
this Section 3, shall determine whether any Payment would be an excess parachute
payment and shall communicate its determination, together with detailed
supporting calculations, to Invacare and to the Executive within 30 days after
the Termination Date or such earlier time as is requested by Invacare. Invacare
and the Executive shall cooperate with each other and the Accounting Firm and
shall provide necessary information so that the Accounting Firm may make all
such determinations. Invacare shall pay all of the fees of the Accounting Firm
for services performed by the Accounting Firm as contemplated in this Section 3.
3.2 Gross-Up of Payments. If any Payment gives rise, directly or
indirectly, to liability on the part of the Executive for excise tax under
Section 4999 of the Internal Revenue Code, Invacare shall make additional cash
payments to the Executive, from time to time and at the same time, as any
Payment constituting an excess parachute payment is paid or provided to the
Executive (or as soon thereafter as is practicable and, in any event, no later
than March 15 of the calendar year which follows the calendar year in which the
excess parachute payment was made or provided to the Executive), in such amounts
as are necessary to put the Executive in the same position, after payment of all
federal, state, and local taxes (whether income taxes, excise taxes under
Section 4999 of the Code or otherwise, or other taxes), as the Executive would
have been in after payment of all federal, state, and local income taxes if the
Payments had not given rise to an excise tax under Section 4999 of the Internal
Revenue Code.
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4. Other Benefits.
4.1 Reimbursement of Certain Expenses After a Change of Control. Invacare
shall pay, as incurred, all expenses incurred by the Executive, including the
reasonable fees of counsel engaged by the Executive, in respect of enforcing the
Executive's rights hereunder and/or defending any action brought to have this
Agreement declared invalid or unenforceable.
4.2 Incapacity of Executive. If, after a Change of Control and prior to the
Termination Date, the Executive is unable to perform services for Invacare for
any period by reason of accidental bodily injury or sickness, Invacare will pay
and provide to the Executive all compensation and benefits to which the
Executive would have been entitled had the Executive continued to be actively
employed by Invacare through the earliest of the following dates: (a) the first
date on which the Executive is again capable of performing services for Invacare
consistent with past practice, or (b) the date on which the Executive's
employment is terminated by Invacare by reason of Disability, or (c) the date on
which Invacare has paid and provided 36 months of compensation and benefits to
the Executive during the period of the Executive's incapacity, or (d) the date
of the Executive's death.
5. No Set-Off; No Obligation to Seek Other Employment or to Otherwise
Mitigate Damages; No Effect Upon Other Plans. Invacare'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 which Invacare may have against the
Executive. The Executive shall not be required to mitigate damages or the amount
of any payment provided for under this Agreement by seeking other employment or
otherwise. The amount of any payment provided for under this Agreement shall not
be reduced by any compensation or benefits earned by the Executive as the result
of employment by another employer or otherwise after the termination of the
Executive's employment.
6. Taxes; Withholding of Taxes. Without limiting the right of Invacare to
withhold taxes pursuant to this Section 6, the Executive shall be responsible
(after taking into account all payments to be made by Invacare to or on behalf
of the Executive under Sections 1 or 2 hereof) for all income, excise, and other
taxes (federal, state, city, or other) imposed on or incurred by the Executive
as a result of receiving the payments provided in this Agreement, including,
without limitation, the payments provided under Sections 1 or 2 of this
Agreement. Subject to Section 3.1 hereof, Invacare may withhold from any amounts
payable under this Agreement all federal, state, city, or other taxes as
Invacare shall determine to be required pursuant to any law or government
regulation or ruling. Without limiting the generality of the foregoing, Invacare
may withhold from any amount payable under any of Section 1 and/or Sections 2.1
through 2.3 of this Agreement amounts sufficient to satisfy any withholding
requirements that may arise out of any benefit provided to or in respect of the
Executive by Invacare under Section 2 of this Agreement.
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7. Term of this Agreement. This Agreement shall be effective as of the date
first above written and shall thereafter apply to any Change of Control
occurring on or before December 31, 2000 or during any succeeding applicable
term, and on December 31, 2000 and on December 31 of each succeeding year
thereafter (a "Renewal Date"), the term of this Agreement, if not previously
terminated, shall be automatically extended for an additional year unless either
party has given notice to the other, at least one year in advance of that
Renewal Date, that the Agreement shall not apply to any Change of Control
occurring after that Renewal Date.
7.1 Termination of Agreement Upon Termination of Employment Before a Change
of Control. This Agreement shall automatically terminate on the first date
occurring before a Change of Control on which the Executive is no longer
employed by Invacare, except that, for purposes of this Agreement, any
termination of employment of the Executive that is effected before and primarily
in contemplation of a Change of Control that actually occurs after the date of
the termination shall be deemed to be a termination of the Executive's
employment as of the date immediately after that Change of Control.
7.2 No Termination of Agreement During Three Year Period Beginning on Date
of a Change of Control. After a Change of Control, this Agreement may not be
terminated. However, if the Executive's employment with Invacare continues for
more than three years following the occurrence of a Change of Control, then, for
all purposes of this Agreement other than Sections 1 and 3.1, that particular
Change of Control shall thereafter be treated as if it never occurred.
8. Miscellaneous.
8.1 Successor to Invacare. Invacare shall not consolidate with or merge
into any other corporation, or transfer all or substantially all of its assets
to another corporation, unless such other corporation shall assume this
Agreement in a signed writing and deliver a copy thereof to the Executive. Upon
such assumption, the successor corporation shall become obligated to perform the
obligations of Invacare under this Agreement and the term "Invacare" as used in
this Agreement shall be deemed to refer to such successor corporation.
8.2 Notices. Notices and all other communications provided for in this
Agreement shall be in writing and shall be deemed to have been duly given when
delivered in person or by confirmed facsimile transmission (to the General
Counsel of Invacare in the case of notices to Invacare and to the Executive in
the case of notices to the Executive) or mailed by United States registered
mail, return receipt requested, postage prepaid, addressed as follows:
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If to Invacare:
Invacare Corporation
Xxx Xxxxxxxx Xxx
Xxxxxx, XX 00000
Attention: General Counsel
If to the Executive:
======================
----------------------
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.
8.3 Employment Rights. Nothing expressed or implied in this Agreement shall
create any right or duty on the part of Invacare or the Executive to have the
Executive continue as an officer of Invacare or to remain in the employment of
Invacare.
8.4 Administration. Invacare shall be responsible for the general
administration of this Agreement and for making payments under this Agreement.
All fees and expenses billed by the Accounting Firm for services contemplated
under this Agreement shall be the responsibility of Invacare.
8.5 Source of Payments. Any payment specified in this Agreement to be made
by Invacare may be made directly by Invacare solely from its general assets, and
the Executive shall have the rights of an unsecured general creditor of Invacare
with respect thereto.
8.6 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.
8.7 Modification; Waiver. 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 the Executive and Invacare. 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.
8.8 Entire Agreement; Supercession. Except as otherwise specifically
provided herein, this Agreement, including its attachments, contains the entire
agreement between the parties concerning the subject matter hereof and
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incorporates and supersedes any and all prior discussions or agreements, written
or oral, the parties may have had with respect to such subject matter; provided,
however, that except as expressly provided otherwise herein nothing in this
Agreement shall affect any rights the Executive or anyone claiming through the
Executive may have in respect of either (a) any Employee Benefit Plan which
provides benefits to or in respect of the Executive or (b) any other agreements
the Executive may have with Invacare or an Affiliate, except to the extent any
such Employee Benefit Plan or other agreement provides benefits which are
duplicative of those provided under this Agreement.
8.9 Post-Mortem Payments; Designation of Beneficiary. In the event that,
following the termination of the Executive's employment with Invacare, the
Executive is entitled to receive any payments pursuant to this Agreement and the
Executive dies, such payments shall be made to the Executive's Beneficiary
designated hereunder. At any time after the execution of this Agreement, the
Executive may prepare, execute, and file with the Secretary of the Company a
copy of the Designation of Beneficiary form attached to this Agreement as
Exhibit A. The Executive shall thereafter be free to amend, alter or change such
form; provided, however, that any such amendment, alteration or change shall be
made by filing a new Designation of Beneficiary form with the Secretary of the
Company. In the event the Executive fails to designate a beneficiary, following
the death of the Executive all payments of the amounts specified by this
Agreement which would have been paid to the Executive's designated beneficiary
pursuant to this Agreement shall instead be paid to the Executive's spouse, if
any, if she survives the Executive or, if there is no spouse or she does not
survive the Executive, to the Executive's estate.
8.10 Service with Affiliates. Any services the Executive performs for an
Affiliate shall be deemed performed for Invacare. Any transfer of the
Executive's employment from Invacare to an Affiliate, or from an Affiliate to
Invacare, or from an Affiliate to another Affiliate shall be deemed not to
constitute a termination of the Executive's employment with Invacare.
8.11 Time Periods. Any action required to be taken under this Agreement
within a certain number of days shall be taken within that number of calendar
days; provided, however, that if the last day for taking such action falls on a
weekend or a holiday, the period during which such action may be taken shall be
automatically extended to the next business day. If the day for taking any
action under this Agreement falls on a weekend or a holiday, such action may be
taken on the next business day.
8.12 Incorporation by Reference. The incorporation herein of any terms by
reference to another document shall not be affected by the termination of any
agreement set forth in such other document or the invalidity of any provisions
thereof.
8.13 Binding Effect; Construction of Agreement. This Agreement shall inure
to the benefit of and be enforceable by the Executive's personal
representatives, executors, administrators, successors, heirs, and designees
(including, without limitation, the Beneficiary). Upon the Executive's death,
for purposes of this Agreement, the term "Executive" shall be deemed to include,
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as applicable, any person (including, without limitation, the Beneficiary) who
is entitled to benefits under this Agreement following the Executive's death.
8.14 Governing Law. All questions concerning the construction, validity and
interpretation of this Agreement and the exhibits hereto will be governed by and
construed in accordance with the internal laws of the State of Ohio, without
giving effect to any choice of law or conflict of law provision or rule (whether
of the State of Ohio or any other jurisdiction) that would cause the application
of the laws of any jurisdiction other than the State of Ohio.
8.15 Representations and Warranties of Invacare. Invacare represents and
warrants to the Executive that (i) Invacare is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Ohio; (ii)
Invacare has the power and authority to enter into and carry out this Agreement,
and there exists no contractual or other restriction upon its so doing; (iii)
Invacare has taken such corporate action as is necessary or appropriate to
enable it to enter into and perform its obligations under this Agreement; and
(iv) this Agreement constitutes the legal, valid and binding obligation of
Invacare, enforceable against Invacare in accordance with its terms.
9. Definitions.
9.1 Accounting Firm. The term "Accounting Firm" means the independent
auditors of Invacare for the fiscal year preceding the year in which the Change
of Control occurred and such firm's successor or successors; provided, however,
if such firm is unable or unwilling to serve and perform in the capacity
contemplated by this Agreement, Invacare shall select another national
accounting firm of recognized standing to serve and perform in that capacity
under this Agreement, except that such other accounting firm shall not be the
then independent auditors for Invacare or any of its Affiliates.
9.2 Affiliate. The term "Affiliate" shall mean, with respect to any person
or entity, any other person or entity which controls, is controlled by, or is
under common control with such person or entity.
9.3 Annual Base Salary. "Annual Base Salary" means the highest annual rate
of base salary payable by Invacare to the Executive at any time between the
Effective Date and the Termination Date.
9.4 Beneficiary. "Beneficiary" means the person designated by the Executive
as his beneficiary pursuant to Section 8.9 or such other person as determined
pursuant to Section 8.9 hereof.
9.5 Cause. The employment of the Executive by Invacare shall have been
terminated for "Cause" if, after a Change of Control and prior to the
termination of employment, any of the following has occurred:
(a) the Executive shall have been convicted of a felony,
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(b) the Executive commits an act or series of acts of dishonesty in
the course of the Executive's employment which are materially inimical to
the best interests of Invacare and which constitutes the commission of a
felony, all as determined by the vote of three-fourths of all of the
members of the Board of Directors of Invacare (other than the Executive, if
the Executive is a Director of Invacare), which determination is confirmed
by a panel of three arbitrators appointed and acting in accordance with the
rules of the American Arbitration Association for the purpose of reviewing
that determination,
(c) any federal or state regulatory agency with jurisdiction over
Invacare has issued a final order, with no further right of appeal, that
has the effect of suspending, removing, or barring the Executive from
continuing his service as an officer or director of Invacare, or
(d) after being notified in writing by the Board of Directors of
Invacare to cease any particular Competitive Activity, the Executive shall
intentionally continue to engage in such Competitive Activity while the
Executive remains in the employ of Invacare.
9.6 Change of Control. A "Change of Control" shall be deemed to have
occurred at the first time on which, after the Effective Date:
(a) (1) There is a report filed on Schedule 13D or Schedule 14D-1
(or any successor schedule, form, or report), each as adopted under
the Securities Exchange Act of 1934, as amended, disclosing the
acquisition, in a transaction or series of transactions by any person
(as the term "person" is used in Section 13(d) and Section 14(d)(2) of
the Securities Exchange Act of 1934, as amended), other than A.
Xxxxxxx Xxxxx and/or any Affiliate of A. Xxxxxxx Xxxxx, of such number
of shares of Invacare as entitles that person to exercise 20% or more
of the voting power of Invacare in the election of Directors and (2) a
majority of those members of the Board of Directors who are not
individually a party to an agreement which is, mutatis mutandis,
substantially similar to this Agreement (the "Disinterested
Directors") determine that the acquisition (the "Reported
Acquisition") is likely to result in a change in the effective control
of Invacare; or
(b) During any period of 24 consecutive calendar months,
individuals who at the beginning of such period constitute the
Directors of Invacare cease for any reason to constitute at least a
majority of the Directors of Invacare unless the election of each new
Director of Invacare was approved or recommended by the vote of at
least two-thirds of the Directors of Invacare then still in office who
were Directors of Invacare at the beginning of the period; or
(c) There is a merger, consolidation, combination (as defined in
Section 1701.01(Q), Ohio Revised Code), majority share acquisition (as
defined in Section 1701.01(R), Ohio Revised Code), or control share
acquisition (as defined in Section 1701.01(Z)(1), Ohio Revised Code,
or in Invacare's Articles of Incorporation) involving Invacare and as
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a result of which the holders of shares of Invacare prior to the
transaction become, by reason of the transaction, the holders of such
number of shares of the surviving or acquiring corporation as entitles
them to exercise less than fifty percent (50 %) of the voting power of
the surviving or acquiring corporation in the election of Directors;
or
(d) There is a sale, lease, exchange, or other transfer (in one
transaction or a series of related transactions) of all or
substantially all of the assets of Invacare, but only if the
transferee of the assets in such transaction is not an Affiliate of
Invacare; or
(e) The shareholders of Invacare approve any plan or proposal for
the liquidation or dissolution of Invacare, but only if the transferee
of the assets of Invacare in such liquidation or dissolution is not an
Affiliate of Invacare.
If an event described in any of Clauses (b), (c), (d), and (e) occurs, a
Change in Control shall be deemed to have occurred for all purposes of this
Agreement and, except as provided in the last sentence of Section 7.2, that
Change in Control shall be irrevocable. If an event described in Clause (a)
occurs, a Change of Control (hereinafter, sometimes referred to as a
"Clause (a) Change of Control") shall be deemed to have occurred; but a
Clause (a) Change of Control shall be subject to reversal, and shall be
deemed to have been reversed if, on a subsequent date, a two thirds
majority of the Disinterested Directors determine that the Reported
Acquisition is no longer likely to result in a change in the effective
control of Invacare; provided, that any such subsequent determination may
not be made after the Termination Date or after the occurrence of any event
described in any of Clauses (b), (c), (d), and (e). If a Clause (a) Change
of Control is deemed to have been reversed as a result of the two-thirds
majority determination described above, then, from and after the date of
the reversal, that Clause (a) Change of Control shall be treated for
purposes of this Agreement as if it had never occurred.
9.7 Competitive Activity. The Executive shall be deemed to have engaged in
"Competitive Activity" if the Executive engages in any business or business
activity (other than as a director, officer, or employee of Invacare) in which
Invacare engages as of the time of the notice provided in Section 9.5(d).
9.8 Demotion or Removal. The Executive shall be deemed to have been
subjected to "Demotion or Removal" if, during the three year period commencing
on the date of a Change of Control, other than by Voluntary Resignation or with
the Executive's written consent, the Executive ceases to hold the highest
position held by him at any time during the one year period ending on the date
of the Change of Control with all of the duties, authority, and responsibilities
of that office as in effect at any time during the one year period ending on the
date of the Change of Control.
9.9 Disability. For purposes of this Agreement, the Executive's employment
will have been terminated by Invacare by reason of "Disability" of the Executive
only if (a) as a result of accidental bodily injury or sickness, the Executive
has been unable to perform his normal duties for Invacare for a period of 180
consecutive days, and (b) the Executive begins to receive payments under the
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executive long term disability plan sponsored by Invacare not later than 30 days
after the Termination Date.
9.10 Employee Benefit Plan. "Employee Benefit Plan" means any plan or
arrangement defined as such in 29 U.S.C.ss.1002 which provides benefits to the
employees of Invacare or its Affiliates.
9.11 Good Reason. The Executive shall have "Good Reason" to terminate his
employment under this Agreement if, at any time after a Change of Control has
occurred and before the third anniversary of that Change of Control, one or more
of the events listed in (a) through (f) of this Section 9.11 occurs and, based
on that event, the Executive gives notice of his intention to terminate his
employment effective on a date that is both (i) within 90 days of the occurrence
of that event and (ii) not later than the third anniversary of that Change of
Control:
(a) The Executive is subjected to Demotion or Removal; or
(b) The Executive's Annual Base Salary is reduced; or
(c) The Executive's opportunity for incentive compensation is reduced
from the level of his opportunity for incentive compensation as in effect
immediately before the date of the Change of Control or from time to time
thereafter; or
(d) The Executive is excluded from full participation in any benefit
plan or arrangement maintained for senior executives of Invacare generally;
or
(e) The Executive determines in good faith that his responsibilities,
duties, or authority with Invacare are at any time materially less than or
reduced from those held by him immediately before the Change of Control and
the shortfall or reduction has not been cured within 90 days after the
Executive gives notice to the Board of Directors of Invacare of his
election to terminate his employment for Good Reason based upon that
shortfall or reduction; or
(f) The Executive's principal place of employment for Invacare is
relocated more than 35 miles from One Invacare Way, Elyria, Ohio.
9.12 Internal Revenue Code. A reference to any provision of the Internal
Revenue Code means that provision of the Internal Revenue Code of 1986, as
amended, and any successor provision, and any applicable regulations promulgated
thereunder.
9.13 Target Bonus. "Target Bonus" means the Executive's Annual Base Salary
multiplied by the higher of (a) the target bonus percentage in effect for the
Executive under Invacare's bonus plan during the fiscal year immediately
preceding the fiscal year in which the Change of Control occurs, or (b) the
target bonus percentage in effect for the Executive under Invacare's bonus plan
during the fiscal year in which the Change of Control occurs.
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9.14 Termination Date. "Termination Date" means the date on which the
Executive's employment with Invacare terminates.
9.15 Voluntary Resignation. A "Voluntary Resignation" shall have occurred
if the Executive terminates his employment with Invacare by voluntarily
resigning at his own instance without having been requested to so resign by
Invacare, except that any resignation by the Executive will not be deemed to be
a Voluntary Resignation if, at the time of that resignation, the Executive had
Good Reason to resign.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
INVACARE CORPORATION
("Invacare")
By
--------------------
--------------------
(the "Executive")
13
Schedule of Agreements with Current Executive Officers
Name Position Date of Agreement
---- -------- -----------------
A. Xxxxxxx Xxxxx, III Chairman of the Board of Directors April 1, 2000
and Chief Executive Officer
Xxxxxx X. Xxxxxx President, Chief Operating Officer April 1, 2000
Xxxxxxx X. Xxxxxxxx Senior Vice President and Chief November 12, 2002
Financial Officer
Xxxxxx X. Xxxxxx, XX President - Invacare Technologies, April 1, 2000
Senior Vice President - Electronics
and Design Engineering
Louis X.X. Xxxxxxx Senior Vice President - Sales & April 1, 2000
Marketing
Xxxxxxx X. Xxxxx Vice President-Distributed Products April 1, 2000
Xxxxxx X. Xxxx Senior Vice President - Human May 17, 2004
Resources
Xxxx X. XxXxxxx Senior Vice President - Business January 3, 2006
Development and General Counsel
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