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EXHIBIT 10.19
EMPLOYMENT AND SEVERANCE AGREEMENT
This Employment and Severance Agreement (the "Agreement") entered into
this 5th day of September, 1993, by and between AGCO CORPORATION, a Delaware
corporation (the "Company"), and Xxxxxx X. 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 September 5, 1993,
and shall be for a term of three (3) years, unless extended in writing by both
parties at least 180 days prior to the expiration of such term or unless
otherwise terminated earlier in accordance with Section 6 or any other provision
of this Agreement. If the employment term is not extended pursuant to a mutually
acceptable written agreement at least 180 days prior to the expiration of such
employment term, then at such expiration the Company shall be obligated to
continue to pay to the Executive his Base Salary (as defined in section 3(a)
herein) then in effect, and will continue the Executive's group health and life
insurance, for a period of six (6) months following such expiration.
2. POSITION AND DUTIES.
The Executive shall serve as Vice President, Marketing, 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
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consistent with the Executive's position. The Executive shall perform and
discharge faithfully, diligently and to the best of his ability such duties and
responsibilities and shall devote all of his 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 Sixty Thousand Dollars
($160,000), payable in equal semimonthly 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 obligations pursuant to this Agreement, the Executive shall be
entitled to participate in or receive benefits under any 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.
(d) FRINGE BENEFITS. The Company shall pay or reimburse
Executive for all reasonable and necessary expenses incurred by him in
connection with his 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 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
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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
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COVENANTS.
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(a) ACKNOWLEDGEMENTS. The Executive acknowledges that as Vice
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President, Marketing of the Company (i) he 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 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 part during the term of his
employment and for a reasonable period thereafter would necessarily involve his
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 employment with the Company, he
would have sufficient skills to find alternative, commensurate work in his 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 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.
(b) DEFINITIONS. For purposes of this Section 4, the following
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terms shall have the following meanings:
(i) "COMPETITIVE POSITION" shall mean (i) the
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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
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executive level services substantially similar to those that he will
perform for the Company as its Vice President, Marketing.
(ii) "COMPETITOR" of the Company shall refer to any
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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
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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
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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.
(v) "WORK PRODUCT" shall mean all work product,
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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.
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(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
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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.
(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.
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(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
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of his employment, he 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 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. 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 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
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during the term of his employment, he 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
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employment with the Company, he 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 employment with the Company.
(f) NON-SOLICITATION OF COMPANY PERSONNEL. The Executive
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agrees that, except to the extent that he is required to do so in connection
with his express employment responsibilities on behalf of the Company, during
the term of his employment he 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 employment with the Company, and in the Restricted
Territory, he 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 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
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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
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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 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
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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-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
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
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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 Section.
(d) EFFECT. 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.
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(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 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 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
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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 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
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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:
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(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
(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
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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
(D) A material breach by the Company of this
Agreement.
(vi) "NORMAL RETIREMENT DATE" shall mean the first
day of the month
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coincident with or next following the Executive's sixty-fifth (65th)
birthday.
6. TERMINATION.
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(a) DEATH. The Executive's employment hereunder shall
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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
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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
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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) misconduct that is materially
injurious to the Company or (iii) conviction of a felony involving the personal
dishonesty of the Executive or moral turpitude.
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(d) NOTICE OF TERMINATION. Any termination by the Company
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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
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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 1(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 1(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 specified in the Notice of Termination and the
Company shall have no further obligations to the Executive under this Agreement.
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7. EFFECT OF RE-EMPLOYMENT/OTHER COMPENSATION.
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(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 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.
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(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 Xxxxxxxx Xxxxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx
in the case of the Executive to:
Xxxxxx X. Xxxxxxx
000 Xxxxxxx Xxx
Xxxxxxxxxx, Xxxxxxx 00000
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 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
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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/ ERS 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, distributees, 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.
15. ENTIRE AGREEMENT. This Agreement constitutes the full
agreement and
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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 term 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/ Xxxxxx 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 Xxxxxx X. Xxxxxxx, (the "Executive"), dated September 5, 1993.
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/ X. X. Xxxxxxx
---------------------- ------------------------
Title: President
-------------------- Xxxxxx 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 Xxxxxx X. Xxxxxxx, (the "Executive"), dated September 5, 1993.
Section 1.b of the Agreement is amended to read as follows:
The employment term shall commence on September 5, 1993 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
cooperate with the Executive and not be unreasonable in providing the use of
facilities or free time for outplacement.
AGCO CORPORATION
By: /s/ X. X. Xxxxxxx
----------------------------------
Name: X. X. Xxxxxxx
----------------------------------
Title: Chairman & CEO
----------------------------------
EXECUTIVE
/s/ X. X. Xxxxxxx
----------------------------------
