FOSTER WHEELER LTD. CHANGE OF CONTROL AGREEMENT
XXXXXX
XXXXXXX LTD.
THIS
CHANGE OF CONTROL AGREEMENT (the
“Agreement”) - which is an Exhibit to the Supplemental
Employment Agreement of same date herewith
- by and
among XXXXXX
XXXXXXX CONTINENTAL EUROPE S.r.L.,
(the
“Company”), XXXXXX
XXXXXXX LTD.,
a
Bermuda company (the “Parent”), and FRANCO
BASEOTTO (the
“Executive”), is effective as of the 12th of November,
2007.
WHEREAS,
the
Board of Directors of Parent (the “Board”), has determined that it is in the
best interests of Parent, its shareholders and subsidiaries, including the
Company, to assure that Parent and the Company will have the continued
dedication of the Executive, notwithstanding the possibility, threat or
occurrence of a Change of Control (as defined in Section 2 below). The Board
believes it is imperative to diminish the inevitable distraction of the
Executive by virtue of the personal uncertainties and risks created by a pending
or threatened Change of Control and to encourage the Executive’s full attention
and dedication to Parent and the Company currently and in the event of any
threatened or pending Change of Control, and to provide the Executive with
compensation and benefits arrangements upon a Change of Control which ensure
that the compensation and benefits expectations of the Executive will be
satisfied and which are competitive with those of other corporations. Therefore,
in order to accomplish these objectives, the Board has caused the Company and
the Parent to enter into this Agreement;
NOW,
THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Certain
Definitions.
(a) “Effective
Date”
shall
mean the first date during the Change of Control Period (as defined in Section
1(b) below) on which a Change of Control (as defined in Section 2 below) occurs.
Notwithstanding anything in this Agreement to the contrary, if a
Change
of Control occurs and if the
Executive’s employment
relationship
with
Company
is terminated
prior to
the date on which the Change of Control occurs,
and if
it is reasonably demonstrated by the Executive that such termination:
(i) was
at
the request of a third party who has taken steps reasonably calculated to effect
a Change of Control, or
(ii) otherwise
arose in connection with or in anticipation of a Change of Control,
then
for
all purposes of this Agreement, the “Effective Date” shall mean the date
immediately prior to the date of such termination.
(b) “Change
of Control Period”
shall
mean the period commencing on the date hereof and ending on the third
anniversary of the date hereof; provided,
however,
that
commencing on the date one year after the date hereof, and on each annual
anniversary of such date (such date and each annual anniversary thereof shall
be
hereinafter referred to as the “Renewal
Date”),
unless previously terminated, the Change of Control Period shall be
automatically extended so as to terminate three years from such Renewal Date,
unless at least 60 days prior to the Renewal Date the Company gives notice
to
the Executive that the Change of Control Period shall not be so
extended.
Any
other
definition contained in the Supplemental Employment Agreement which is not
expressly amended by this Agreement shall apply.
2. Change
of Control.
For
the
purpose of this Agreement, a “Change
of Control”
shall
mean:
(a) The
acquisition by any individual, entity or group (a “Person”)
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934, as amended (the “Exchange
Act”))
of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of voting securities of Parent where such acquisition causes
such
Person to own 20% or more of the combined voting power of the then outstanding
voting securities of Parent entitled to vote generally in the election of
directors (the “Outstanding
Voting Securities”),
provided, however, that for purposes of this subsection (a), the following
acquisitions shall not be deemed to result in a Change of Control:
(i) any
acquisition directly from Parent or any corporation or other legal entity
controlled, directly or indirectly, by Parent; or
(ii) any
acquisition by Parent or any corporation or other legal entity controlled,
directly or indirectly, by Parent; or
(iii) any
acquisition by any employee benefit plan (or related trust) sponsored or
maintained by Parent or any corporation or other legal entity controlled,
directly or indirectly, by Parent; or
(iv) any
acquisition by any corporation pursuant to a transaction that complies with
clauses (i), (ii) and (iii) of subsection (c) below; provided,
however,
that if
any Person’s beneficial ownership of the Outstanding Voting Securities reaches
or exceeds 20% as a result of a transaction described in clause (i) or (ii)
immediately above, and such Person subsequently acquires beneficial ownership
of
additional voting securities of Parent, such subsequent acquisition shall be
treated as an acquisition that causes such Person to own 20% or more of the
Outstanding Voting Securities; or
(b) Individuals
who, as of the date hereof, constitute the Board (such individuals, the
“Incumbent
Board”)
cease
for any reason to constitute at least a majority of the Board; provided,
however,
that
any individual becoming a director subsequent to the date hereof whose election,
or nomination for election by Parent’s shareholders, was approved by a vote of
at least a majority of the directors then comprising the Incumbent Board shall
be considered as though such individual were a member of the Incumbent Board,
but excluding, for this purpose, any such individual whose initial assumption
of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than
the
Board; or
(c) The
approval by the shareholders of Parent of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of Parent (“Business
Combination”)
or, if
consummation of such Business Combination is subject, at the time of such
approval by shareholders, to the consent of any government or governmental
agency, the obtaining of such consent (either explicitly or implicitly by
consummation); excluding,
however,
such a
Business Combination pursuant to which:
(i) all
or
substantially all of the individuals and entities who were the beneficial owners
of the Outstanding Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more than 60% of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation that as a result of such transaction owns Parent or all or
substantially all of Parent’s assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership,
immediately prior to such Business Combination of the Outstanding Voting
Securities;
2
(ii) no
Person
(excluding any (x) corporation owned, directly or indirectly, by the beneficial
owners of the Outstanding Voting Securities as described in clause (i)
immediately preceding or (y) employee benefit plan (or related trust) of Parent
or such corporation resulting from such Business Combination, or any of their
respective subsidiaries) beneficially owns, directly or indirectly, 20% or
more
of, respectively, the then outstanding shares of common stock of the corporation
resulting from such Business Combination or the combined voting power of the
then outstanding voting securities of such corporation except to the extent
that
such ownership existed prior to the Business Combination; or
(iii) at
least
a majority of the members of the board of directors of the corporation resulting
from such Business Combination were members of the Incumbent Board at the time
of the execution of the initial agreement, or of the action of the Board,
providing for such Business Combination; or
(d) Approval
by the shareholders of Parent of a complete liquidation or dissolution of
Parent.
For
the
avoidance of doubt, neither the approval nor the consummation of the merger
of
Xxxxxx Xxxxxxx Corporation (“FWC”)
with
and into Xxxxxx Xxxxxxx LLC, a Delaware limited liability company and an
indirect wholly-owned subsidiary of Parent whereby each outstanding share of
common stock of FWC (other than those shares held by FWC or any direct or
indirect wholly-owned subsidiary of FWC) was converted into one common share
of
Parent, or any restructuring transactions contemplated by or related to such
merger, shall be deemed to constitute or result in, directly or indirectly,
a
Change of Control, for purposes of this Agreement.
3. Term.
For
the
period of three years commencing on the Effective Date (the “Term”),
the
terms and conditions of the Executive employment defined in Section 4 below
shall apply. The Term
shall
terminate upon termination of
the
Executive’s employment
with
Company
for any
reason.
4. Terms
of Employment.
(a) Position
and Duties.
(i) During
the Term:
(A) the
Executive’s position (including status, offices, titles and reporting
requirements), his authority, his duties and his responsibilities shall be
at
least commensurate in all material respects with the most significant of those
held, exercised and assigned at any time with the Company and/or
Parent
during
the 120-day period immediately preceding the Effective Date; and
(B) the
Executive’s services shall be performed at the office where the Executive was
employed immediately preceding the Effective Date or at any other location
less
than 50
miles
from such office.
(ii) During
the
Term,
and excluding any periods of vacation and sick leave to which the Executive
is
entitled, the Executive agrees to devote reasonable attention and time during
normal business hours to the business and affairs of the Company and or Parent
and,
to the
extent necessary to discharge the responsibilities assigned to the Executive,
to
use the Executive’s reasonable best efforts to perform faithfully and
efficiently such responsibilities. During the Term,
it shall
not be a violation of this Agreement for the Executive to:
(A) serve
on
corporate, civic or charitable boards or committees;
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(B) deliver
lectures, fulfill speaking engagements or teach at educational institutions;
or
(C) manage
personal investments, so long as such activities do not significantly interfere
with the performance of the Executive’s responsibilities as an employee of the
Company in accordance with this Agreement.
It
is
expressly understood and agreed that to the extent that any such activities
have
been conducted by the Executive prior to the Effective Date, the continued
conduct of such activities (or the conduct of activities similar in nature
and
scope thereto) subsequent to the Effective Date shall not thereafter be deemed
to interfere with the performance of the Executive’s responsibilities to the
Company
and/or
Parent.
(b) Compensation.
(i) Retribuzione
Annua Lorda.
During
the Term,
the
Executive shall receive a Retribuzione
Annua Lorda (as
defined in Section 3.1.1(vii) of the Supplemental Employment Agreement of even
date herewith),
equal to
the Retribuzione
Annua Lorda
of the
Executive at the Effective Date, including any portion of the Retribuzione
Annua Lorda
which
has been earned but deferred in
respect of the twelve-month period immediately preceding the month in which
the
Effective Date occurs. The Retribuzione
Annua Lorda
shall be
paid at such intervals as the Company pays executive salaries generally. During
the Term,
the
Retribuzione
Annua Lorda
shall be
reviewed at least annually, beginning no more than 12 months after the last
salary increase awarded to the Executive prior to the Effective Date. Any
increase in Retribuzione
Annua Lorda
shall
not serve to limit or reduce any other obligation to the Executive under this
Agreement. Retribuzione
Annua Lorda
shall
not be reduced after any such increase and the term “Retribuzione
Annua Lorda”
shall
refer to Annual Gross
Salary
as so increased.
(ii) Bonus.
In
addition to Retribuzione
Annua Lorda,
but
subject to Section 4(b)(ix) below, the Executive shall be awarded, for each
fiscal year ending during the Term,
an
annual bonus (the “Annual
Bonus”)
in
cash equal to at least the highest “annual
short-term incentive award” (as such terminology is defined in the Xxxxxx
Xxxxxxx Annual Executive Short-Term Incentive Plan) received by the Executive
under the Xxxxxx Xxxxxxx Annual Executive Short-Term Incentive Plan, or any
comparable bonus under any predecessor or successor plan, including any bonus
or
portion thereof that has been awarded but deferred, for the last three full
fiscal years prior to the Effective Date (or for such lesser number of full
fiscal years prior to the Effective Date for which the Executive was eligible
to
earn such a bonus, and related to the actual months of service in the event
that
the Executive was not employed by the Company
or
another Xxxxxx Xxxxxxx affiliate
for the
whole of such fiscal year) (the “Recent
Annual Bonus”).
Each
such Annual Bonus shall be paid no later than the fifteenth day of the third
month of the fiscal year next following the fiscal year for which the Annual
Bonus is awarded, unless the Executive shall elect to defer the receipt of
such
Annual Bonus.
(iii) Incentive,
Savings and Retirement Plans.
During
the Term,
the
Executive shall be entitled to participate in all cash incentive, equity
incentive,
savings
and retirement plans,
practices, policies and programs applicable generally to other peer executives
of the Company and the Parent,
but in
no event shall such plans, practices, policies and programs (taken together
with
the bonus payable under Section 4(b)(ii) above) provide the Executive with
incentive opportunities (measured with respect to both regular and special
incentive opportunities, to the extent, if any, that such distinction is
applicable), savings opportunities and retirement benefit opportunities, in
each
case, less favorable, in the aggregate, than the most favorable of those
provided by the Company and/or Parent
for the
Executive under such plans, practices, policies and programs as in effect at
any
time during the 120-day period immediately preceding the Effective Date or
if
more favorable to the Executive, those provided generally at any time after
the
Effective Date to other peer executives of the Company
and/or
Parent.
4
(iv) Welfare
Benefit Plans.
During
the Term,
the
Executive and/or the Executive’s family, as the case may be, shall be eligible
for participation in and shall receive all benefits under welfare benefit plans,
practices, policies and programs provided by the Company (including, without
limitation, FASI coverage, Xxxxx Xxxxxx, medical check-ups,
life and
accident
insurance coverage, and
professional insurance coverage, if any, provided for under the Employment
Contract (as such term is defined in the Supplemental Employment Agreement
of
even date herewith))
to the
extent applicable generally to other peer executives of the Company and/or
Parent. In
no
event shall such plans, practices, policies and programs provide the Executive
with benefits which are less favorable, in the aggregate, than the most
favorable of such plans, practices, policies and programs in effect for the
Executive at any time with the Company and/or Parent
during
the 120-day period immediately preceding the Effective Date or, if more
favorable to the Executive, those provided generally at any time after the
Effective Date to other peer executives of the Company
and/or
Parent.
(v) Expenses.
During
the Term,
the
Executive shall be entitled to receive prompt reimbursement for all reasonable
expenses incurred by the Executive in accordance with the most favorable
policies, practices and procedures of the Company and/or Parent
in
effect for the Executive at any time during the 120-day period immediately
preceding the Effective Date or, if more favorable to the Executive, as in
effect generally at any time thereafter with respect to other peer executives
of
the Company
and/or
Parent.
(vi) Fringe
Benefits.
During
the Term,
the
Executive shall be entitled to perquisites and fringe benefits, including,
without limitation, tax, financial and estate planning services, payment of
club
dues, use of an automobile and mobile phone and payment of related expenses,
facsimile machine, annual physical exam, and relocation assistance, in
accordance with the Employment Contract and the Supplemental Employment Contract
of
even
date herewith
and, in
any case, in accordance with the most favorable plans, practices, programs
and
policies of the Company and/or
Parent and
in
effect for the Executive at any time during the 120-day period immediately
preceding the Effective Date or, if more favorable to the Executive, as in
effect generally at any time thereafter with respect to other peer executives
of
the Company
and/or
Parent.
(vii) Office
and Support Staff.
During
the Term,
the
Executive shall be entitled to an office or offices of a size and with
furnishings and other appointments, and to exclusive personal secretarial and
other assistance, equal to at least the most favorable of the foregoing provided
to the Executive by the Company and/or Parent
at any
time during the 120-day period immediately preceding the Effective Date or,
if
more favorable to the Executive, as provided generally at any time thereafter
with respect to other peer executives of the Company
and/or
Parent.
(viii) Vacation.
During
the Term,
the
Executive shall be entitled to paid vacation in accordance with the most
favorable plans, policies, programs and practices of the Company and/or
Parent
as in
effect for the Executive at any time during the 120-day period immediately
preceding the Effective Date or, if more favorable to the Executive, as in
effect generally at any time thereafter with respect to other peer executives
of
the Company
and/or
Parent.
5
(ix) Immediate
Payment of
Annual
Bonus.
As
soon
as technically possible following the Effective Date, the Executive shall
receive payment in cash of the Annual
Bonus
under the Xxxxxx Xxxxxxx Annual Executive Short-Term Incentive Plan, or any
successor plan, for the year in which the Change of Control takes place equal
to
the Annual
Bonus
the Executive received (if any) for the calendar year immediately preceding
the
year in which the Change of Control took place. If it is determined, after
the
end of the year in which the Change of Control took place, that the amount
of
the Annual
Bonus
that is actually due to the Executive for such year under the Xxxxxx Xxxxxxx
Annual Executive Short-Term Incentive Plan, or any successor plan,
exceeds
the amount paid pursuant to the preceding sentence, the excess shall be paid
to
the Executive in accordance with the timing set forth by the last sentence
of
the Section
4(b)(ii)
immediately
above.
It is expressly agreed that the Annual
Bonus
paid for the year in which the Change of Control takes place in no event shall
be lower than the Recent Annual Bonus.
(x) Social
Security
Contributions.
For
the
avoidance of doubt, it
is
understood that,
with
respect to any payment/benefits
under
paragraphs
(i)
through (ix) above, the
Executive shall be responsible for and pay any social security contributions
that are the responsibility of the employee under the applicable law, while
the
Company shall exclusively be responsible for and pay the social security
contributions as well as the Trattamento
di Fine Rapporto
(Severance Indemnity) on payments under (i) and (ii) immediately above, that
are
the responsibility of the employer under the applicable law.
The
Executive fully acknowledges and agrees that the entitlements outlined from
paragraph (i) through paragraph (x) above shall be the sole and exclusive
compensation items due to Executive during the Term
in
relation to his employment with the Company, except for any other different
benefits/compensation items he is entitled to under Italian law and the National
Contract on the Effective Date which, in light of their mandatory nature, cannot
be lawfully offset.
5. Termination
of Employment.
(a)
General
Rule.
During
the Term but subject to paragraph (b) and (c) below, the termination
of the
Executive’s employment
with the
Company
shall be
governed by Italian law and the National Contract.
(b)
“Licenziamento
per Giusta Causa”. The
Company can terminate the Executive “Licenziamento
Per
Giusta Causa”
as
such
term is defined in
the
Supplemental Employment Agreement of even date herewith.
However,
for the sole purpose of this Agreement, the Executive fully acknowledges and
agrees that the events outlined immediately below shall represent a substantial
breach of his employment duties and shall entitle the Company to take, during
the Term,
any
disciplinary actions under the
Supplemental Employment Agreement
which
may eventually determine the Executive’s termination falling under the
definition of “Licenziamento
per Giusta Causa”
during
the Term:
(i) the
willful
and
continued failure of the Executive to perform substantially the Executive’s
duties (as contemplated by Section 4(a) above) with the Company or Parent (other
than any such failure resulting from incapacity due to physical or mental
illness), after a written demand for substantial performance is delivered to
the
Executive by the Board of Directors of the Company or the Chief Executive
Officer of the Parent which specifically identifies the manner in which the
Board of Directors of the Company or Chief Executive Officer of the Parent
believes that the Executive has not
substantially
performed the Executive’s duties; or
6
(ii) the
willful engaging by the Executive in illegal conduct or gross misconduct which
is materially and demonstrably injurious to Parent or the Company.
For
purposes of this provision, no act or failure to act, on the part of the
Executive, shall be considered “willful” unless it is done, or omitted to be
done, by the Executive in bad faith or without reasonable belief that the
Executive’s action or omission was in the best interests of Parent or the
Company. Any act, or failure to act, based upon authority given pursuant to
a
resolution duly adopted by the Board or upon the instructions of the Chief
Executive Officer of the Parent or a senior officer of the Company and/or Parent
or based upon the advice of counsel for Parent or the Company shall be
conclusively presumed to be done, or omitted to be done, by the Executive in
good faith and in the best interests of Parent and the Company.
(c)
“Dimissioni
Per Giusta Causa”. The
Executive may resign from the Company “Dimissioni
Per
Giusta Causa”
as
such
term is defined in
the
Supplemental Employment Agreement of even date herewith. However,
for the sole purpose of this Agreement, resignation “Dimissioni
Per
Giusta Causa”
shall
not only have the meaning established by the Supplemental Employment
Agreement
but,
additionally, shall include the following during the Term:
(i) the
assignment to the Executive of any duties inconsistent in any respect with
the
Executive’s position with
the
Company and/or Parent
(including status, offices, titles and reporting requirements), authority,
duties or responsibilities as contemplated by Section 4(a) above, or any other
diminution in such position, authority, duties or responsibilities (whether
or
not occurring solely as a result of Parent ceasing to be a publicly traded
entity), excluding for this purpose an isolated, insubstantial and inadvertent
action not taken in bad faith and which is remedied by the Company and/or Parent
promptly after receipt of notice thereof given by the Executive;
(ii) any
failure by the Company
and/or
Parent
to
comply with any of the provisions of Section 4(b) above, other than an isolated,
insubstantial and inadvertent failure not occurring in bad faith and which
is
remedied by the Company
and/or
Parent
promptly
after receipt of notice thereof given by the Executive;
(iii) the
Company’s requiring the Executive:
(A) to
be
based at any office or location other than as provided in Section 4(a)(i)(B);
(B) to
be
based at a location other than the principal executive offices of the Company
if
the Executive was employed at such location immediately preceding the Effective
Date; or
(C) to
travel
on Company and/or
Parent
business
to a substantially greater extent than required immediately prior to the
Effective Date; or
(iv) any
failure by the Company and/or Parent
to
comply with and satisfy Section 10(b).
(d) Notice
of Termination and Date of Termination.
Any
termination by the Company and resignation by the Executive during the
Term
shall be
carried out in compliance with the formal requirements established by Italian
law and the National Contract and shall be effective in accordance with Italian
law and the National Contract.
The date
upon which Executive’s employment terminates for any reason shall be the
Executive’s “Date of Termination” for all purposes of this
Agreement.
6. Obligations
of the Company Upon
Termination During the Term.
7
(a) Entitlements
Upon Termination
Falling Under the Definition of Licenziamento
Senza
Giusta Causa,
Licenziamento
Ingiustificato or
Licenziamento
Giustificato,
or Upon Dimissioni
Per Giusta Causa.
Following any termination of the Executive’s employment by the Company falling
under the definition
of
Licenziamento
Senza Giusta Causa (as
defined under the Supplemental Employment Agreement), Licenziamento
Ingiustificato (as
defined under the Supplemental Employment Agreement), Licenziamento
Giustificato (as
defined under the Supplemental Employment Agreement), or resignation from the
employment by the Executive falling under the definition of Dimissioni
Per Giusta Causa (as
defined under Section 5(c) above), the
Executive shall be entitled to:
(i)
Trattamento di Fine Rapporto (Severance
Indemnity) and any final payments due by law (such as the
indemnity in lieu of the accrued paid-leave, quota of 13 monthly
compensation). AND
(ii) One
of
the following, at the Executive’s exclusive choice:
(A) any
other
payments or benefits required and due
under
the Employment Contract;
OR
(B) the
following benefits:
(I) Retribuzione
Annua Lorda/Annual
Bonus/Deferred Compensation and Equity Incentive:
a
lump
sum amount
in cash
within 30 days after the Date of Termination
equal
to
the
aggregate of the following amounts:
(1) the
sum
of:
(a) the
Executive’s Retribuzione
Annua Lorda
through
the Date of Termination to the extent not theretofore paid; PLUS
(b) the
product of:
(i) the
higher of:
(A) the
Executive’s Recent Annual Bonus; or
(B) the
Annual Bonus paid or payable, including any bonus or portion thereof which
has
been awarded but deferred (and related to the actual months of service for
any
fiscal year consisting of less than twelve full months or during which the
Executive was employed for less than twelve full months), for the most recently
completed fiscal year during the Term,
if any
(such
higher amount being referred to as the “Highest
Annual Bonus”)
MULTIPLIED
BY
(ii) fraction,
the numerator of which is the number of days in the current fiscal year through
the Date of Termination, and the denominator of which is 365; PLUS
(c) any
compensation previously deferred by the Executive (together with any accrued
legal interest) other than Trattamento
di Fine Rapporto
(Severance Indemnity), and any accrued vacation pay, in
each
case, to the extent not theretofore paid, (the sum of the amounts described
in
clauses
(a), (b)
and (c) hereinafter referred to as the “Accrued
Obligations”);
8
(2) the
amount equal to the product of:
(a) three;
MULTIPLIED
BY
(b) the
sum
of:
(i) the
Executive’s Retribuzione
Annua Lorda plus
the
relevant Trattamento
di Fine Rapporto (Severance
Indemnity) accrued; and
(ii) the
Highest Annual Bonus;
(3) an
amount
equal to the social security contributions (INPS and PREVINDAI) the
Company would pay for the Executive if the employment relationship continued
for
three years from the Date of Termination, assuming that the Executive’s
compensation to calculate such social security contribution amount is the
Retribuzione
Annua Lorda at
the
Date of Termination;
(4) payment
for any shares of restricted common shares granted to the Executive by the
Company under the Xxxxxx Xxxxxxx Annual Long Term Incentive Plan (as such plan
is amended from time to time) or any successor plan thereto, or any
other
equity
plan
(whether or not vested), to the extent such shares are tendered to the Company
or Parent, as applicable, by the Executive within 20 days after the Date of
Termination, at a price per share equal to the highest of:
(a) the
market price on the New York Stock Exchange of a common share of Parent at
the
close of business on the date of such tender;
(b) the
highest price paid for a common share of Parent in any Change of Control
transaction occurring on or after the Effective Date; or
(c) the
market price on the New York Stock Exchange of a common share of Parent at
the
close of business on the date of any such Change of Control
transaction;
(II) Welfare
Benefits:
for
five
years after the Executive’s Date of Termination, or such longer period as may be
provided by the terms of the appropriate plan, program, practice or policy,
benefit
continuation
to the
Executive and/or the Executive’s family equal to at least those which would have
been provided to them in accordance with the plans, programs, practices and
policies described in Section 4(b)(iv) above of this Agreement if the
Executive’s employment had not been terminated or, if more favorable to the
Executive, as in effect generally at any time thereafter with respect to other
peer executives of the Company
and/or
Parent
and
their families, provided,
however,
that if
the Executive becomes reemployed with another employer and is eligible to
receive medical or other welfare benefits under another employer provided plan,
the medical and other welfare benefits described herein shall be secondary
to
those provided under such other plan during such applicable period of
eligibility. For purposes of determining eligibility (but not the time of
commencement of benefits) of the Executive for retiree benefits pursuant to
such
plans, practices, programs and policies, the Executive shall be considered
to
have remained employed until the fifth anniversary of the Date of Termination
and to have retired on such fifth anniversary;
9
(III) Outplacement
Services: outplacement
services, the scope and provider of which shall be selected by the Executive
in
the Executive’s sole discretion;
(IV) Other
Benefits:
to the
extent not theretofore paid or provided, any
other
amounts or benefits required to be paid or provided or which the Executive
is
eligible to receive under any plan, program, policy or practice or contract
or
agreement of the Company and/or Parent
(such
other amounts and benefits shall be hereinafter referred to as the “Other
Benefits”);
and
(V) Stock-Options: full
vesting to all stock-options, vested and unvested, granted to the Executive,
to
purchase shares of Parent pursuant to the Xxxxxx Xxxxxxx Annual Long Term
Incentive Plan (as such plan is amended from time to time) or any successor
plan.
(VI)
Social
Security Contribution.
For the
avoidance of doubt, it is understood that, with respect to any payments/benefits
under Clauses (I) through (V) above, the Executive shall be responsible for
and
pay any social security contributions that are the responsibility of the
employee under the applicable law, while the Company shall exclusively be
responsible for and pay the social security contributions that are the
responsibility of the employer under the applicable law.
(b) Executive
Acknowledgements Regarding Entitlements Under Section 6(a)(ii)(B)
Above.
Should
the Executive choose the alternative package under Section 6(a)(ii)(B) above,
the Executive fully acknowledges and agrees that:
(i) the
entitlements under Section 6(a)(ii)(B) above include the amount the Executive
would have been entitled to as Indennità
Sostitutiva del Preavviso (Indemnity
in Lieu of Notice) due under Italian law and the National Contract (including
any social security contribution required to be paid on such amounts by the
Company);
(ii) the
entitlements under Section 6(a)(ii)(B) above shall be fully satisfactory of
any
possible claim of the Executive related to the termination of the employment
relationship,
save
for Trattamento
di Fine Rapporto (T.F.R.)
(Severance Indemnity) and the final payments due by law (such as the indemnity
in lieu of accrued paid-leave, quota of 13 monthly compensation);
therefore, by accepting such entitlements and fulfilling the requirements of
paragraph (iii) immediately below, the Executive shall waive any claims or
actions he may bring in relation to the termination of the employment
relationship and, in particular and by way of example, the Executive shall
waive
any claim for payment of the Indennità
Supplementare
and for
payment of any further compensation for damages, if any;
(iii) payment
of the entitlements under Section 6(a)(ii)(B) above shall be carried out only
upon formalization of a settlement agreement which both the Executive and the
Company agree in good faith to execute within a short period of time - in
accordance with the Supplemental
Employment Agreement - before the appropriate authorities in order to make
such
settlement agreement final and unchallengeable under Italian law; in this
respect, the Executive, by executing this Agreement, gives his consent to such
formalization and to appearance before the appropriate authorities upon the
Company’s request;
and
(iv) for
the
avoidance of doubt, the intent of this Section 6 is to make it clear that the
Executive:
(A)
upon
termination of the employment relationship with the Company, is always entitled
to Trattamento
di Fine Rapporto (Severance
Indemnity) and the final payments due by law; but
10
(B)
has
an exclusive choice of receiving either the benefits under Section 6(a)(ii)(A)
or the benefits under Section 6(a)(ii)(B), but not both.
(c) Entitlements
Upon Termination Due to the Executive’s Death.
During
the Term, if the Executive’s employment is terminated by reason of the
Executive’s death during the Term,
the
Executive’s estate or beneficiaries
shall be
provided
with:
(i) the
payments due under Italian law and the National Contract in case of death of
the
Executive;
(ii) an
amount
representing the difference between Accrued Obligations under Section
6
above and the payments made under paragraph (i) immediately above;
and
(iii) Other
Benefits (i.e.
benefits equal to at least the most favorable benefits provided by the Company
and/or Parent
to the
estates and beneficiaries of peer executives of the Company and/or
Parent
under
such plans, programs, practices and policies relating to death benefits, if
any,
as in effect with respect to other peer executives and their beneficiaries
at
any time during the 120-day period immediately preceding the Effective Date
or,
if more favorable to the Executive’s estate and/or the Executive’s
beneficiaries, as in effect on the date of the Executive’s death with respect to
other peer executives of the Company and/or
Parent and their
beneficiaries).
(d) Entitlements
Upon Termination by the Company Falling Under the Definition of
“Licenziamento
per Giusta Causa”.
Following
any termination of the Executive’s employment by the Company falling under the
definition of “Licenziamento
per Giusta Causa”
(as
defined under Section 5(b) above)
during
the Term,
the
Company shall pay or provide to the Executive:
(i) Trattamento
di Fine Rapporto (Severance
Indemnity);
(ii) Any
other
payments/benefits due under Italian law and the National Contract, as well
as
under the Employment Contract;
and
(iii) Other
Benefits.
(e) Entitlements
Upon “Dimissioni
Senza Giusta Causa”.
Following
any termination of the Executive’s employment upon “Dimissioni
Senza Giusta Causa”
(as
defined under the Supplemental Employment Agreement of even date herewith)
by
the
Executive during the Term,
the
Company shall pay or provide to the Executive:
(i) Trattamento
di Fine Rapporto (Severance
Indemnity);
(ii) Any
other
payments/benefits due under Italian law and the National Contract, as well
as
under the Employment Contract;
(iii) the
Accrued Obligations; and
(iv) Other
Benefits.
7. Non-exclusivity
of Rights.
Nothing
in this Agreement shall prevent or limit the Executive’s continuing or future
participation in any plan, program, policy or practice provided by the Company
or Parent and for which the Executive may qualify, nor, subject to Section
6(b)
and Section 12(h), shall anything herein limit or otherwise affect such rights
as the Executive may have under any other contract or agreement with the Company
or Parent. Amounts which are vested benefits or which the Executive is otherwise
entitled to receive under any plan, policy, practice or program of or any
contract or agreement with the Company or Parent at or subsequent to the Date
of
Termination shall be payable in accordance with such plan, policy, practice
or
program or contract or agreement except as explicitly modified by this
Agreement. Notwithstanding the foregoing, if the Executive receives payments
and
benefits pursuant to Section 6(a) of this Agreement, the Executive shall not
be
entitled to any severance pay or benefits under any severance plan, program
or
policy of the Company
or
Parent,
unless
specifically provided therein in a specific reference to this
Agreement.
11
8. Full
Settlement.
The
Company’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, right or action
which
the Company may have against the Executive or others. In no event shall the
Executive be obligated to seek other employment or take any other action by
way
of mitigation of the amounts payable to the Executive under any of the
provisions of this Agreement and such amounts shall not be reduced whether
or
not the Executive obtains other employment. The Company agrees to pay as
incurred (within ten days following the Company’s receipt of an invoice from the
Executive), to the full extent permitted by law, all legal fees and expenses
which the Executive may reasonably incur as a result of any contest (regardless
of the outcome thereof) by the Company, the Executive or others of the validity
or enforceability of, or liability under, any provision of this Agreement or
any
guarantee of performance thereof (including as a result of any contest by the
Executive about the amount of any payment pursuant to this Agreement), plus
in
each case legal interest accrued on any delayed payment.
9. Confidential
Information.
The
Executive shall hold in a fiduciary capacity for the benefit of the
Company
and/or
Parent
all
secret or confidential information, knowledge or data relating to the Company,
Parent
or the
Affiliated Companies,
and
their respective businesses, which information, knowledge or data shall have
been obtained by the Executive during the Executive’s employment by the Company,
Parent or the Affiliated Companies
and
which information, knowledge or data shall not be or become public knowledge
(other than by acts by the Executive or representatives of the Executive in
violation of this Agreement). After termination of the Executive’s employment
with the Company, the Executive shall not, without the prior written consent
of
the Parent
or as
may otherwise be required by law or legal process, communicate or divulge any
such information, knowledge or data to anyone other than the Company
and/or
Parent and
those
persons designated by the Company
and/or
Parent.
In no
event shall an asserted violation of the provisions of this Section 9 constitute
a basis for deferring or withholding any amounts otherwise payable to the
Executive under this Agreement.
10. Successors.
(a) Successors
to the Company and Parent.
This
Agreement shall inure to the benefit of and be binding upon the Company, Parent
and its successors and assigns.
Assignability of this
Agreement by
Executive and by Company shall be governed by Section 8.5 of the Supplemental
Employment Agreement.
(b) Assumption
of Agreement by Successors.
Parent
and the Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of
the
business and/or assets of the Company and/or Parent to assume expressly and
agree to perform this Agreement in the same manner and to the same extent that
the Company would be required to perform it if no such succession had taken
place.
12
11. Company
and Parent Financial Responsibilities.
(a) Company
Financial Responsibilities.
The
Company, as Executive’s employer, is the sole obligor with respect to any
payments made under this Agreement.
(b) Parent
Financial Responsibilities.
Parent
is the parent company of the Company. In that capacity , Parent unconditionally
guarantees the payment in full of all obligations of the Company under this
Agreement.
12.
Miscellaneous.
(a) Language. For
the
avoidance of doubt, it has been agreed between the parties that this Agreement,
as drafted in the Italian language, shall be interpreted in accordance with
the
Italian language; provided, however, that only Sections 10 and 11 (b) shall
be
interpreted in accordance with the typical meaning ascribed to those provisions
under the English language on the basis of the English translation of this
Agreement. In other words, if an issue of interpretation of the provisions
in
Section 10 and 11 shall ever arise between the parties, the English language
and
interpretation of those provisions shall be given preference over any contrary
construction or interpretation under Italian language.
(b)
Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws of
Italy.
(c) Choice
of Forum.
The
Court
of Milan shall have exclusive jurisdiction over any disputes arising from this
Agreement.
(d) Headings.
The
captions/headings of this Agreement are not part of the provisions hereof and
shall have no force or effect.
(e) Amendment.
This
Agreement may not be amended or modified other than by a written agreement
executed by the parties hereto or their respective successors and legal
representatives.
(f) Notices. To
the Company and/or Parent.
All
notices,
requests, consents and other communications required or permitted to be given
hereunder
shall be in writing and shall be carried out by overnight courier or first
class, prepaid, registered
or certified mail, as
follows (or to such other address as either party shall designate by notice
in
writing to the other in accordance herewith):
If
to the
Company and/or Parent, to:
Xxxxxx
Xxxxxxx Continental Europe S.r.L.
c/o
Xxxxxx
Xxxxxxx, Inc.
Xxxxxxxxxx
Xxxxxxxxx Xxxx
Xxxxxxx,
XX 00000-0000
Attention:
Executive Vice President and General Counsel
To
the Executive.
If
to the
Executive, to the Executive’s principal residence as reflected in the records of
the Company.
(g) Severability.
The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this
Agreement.
(h) Tax
Withholding.
The
Company may withhold from any amounts payable under this Agreement such taxes
as
shall be required to be withheld pursuant to any
applicable
law or
regulation.
13
(i) No
Waiver.
The
Executive’s,
the
Company’s or the Parent’s
failure
to insist upon strict compliance with any provision of this Agreement or the
failure to assert any right the Executive,
the
Company or the Parent
may have
hereunder, shall not be deemed to be a waiver of such provision or right or
any
other provision or right of this Agreement.
IN
WITNESS WHEREOF,
the
Executive has hereunto set the Executive’s hand and, pursuant to the
authorization from the Board, the Company
and the
Parent has caused this Agreement to be executed in its name on its behalf,
all
effective as of the day and year first above written.
|
XXXXXX XXXXXXX CONTINENTAL EUROPE
S.r.L.
|
||
| |
|
|
| By: | /s/ Xxxxxxx xxxxx Xxxx | |
|
Name: Xxxxxxx xxxxx Xxxx |
||
| Title: Chairman and CEO | ||
|
XXXXXX
XXXXXXX LTD.
|
||
| |
|
|
| By: | /s/ Xxxxxxx X. Xxxxxxxxxx | |
|
Name: Xxxxxxx X. Xxxxxxxxxx |
||
| Title: Chairman and CEO | ||
| /s/ Franco Baseotto | ||
|
FRANCO BASEOTTO |
||
14
