UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
Current Report
Dated December 10, 2007
Dated December 10, 2007
of
AGCO CORPORATION
A Delaware Corporation
IRS Employer Identification No. 58-1960019
SEC File Number 1-12930
IRS Employer Identification No. 58-1960019
SEC File Number 1-12930
4205 River Green Parkway
Duluth, Georgia 30096
(770) 813-9200
Duluth, Georgia 30096
(770) 813-9200
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4(c))
Item 1.01. Entry Into a Material Definitive Agreement.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On December 5, 2007, in large part to reflect the requirements of Section 409A of the Internal
Revenue Code, but also to make various other minor changes, AGCO Corporation (the “Company”)
entered into amended and restated employment and severance agreements (each, an “Agreement” and,
collectively, the “Agreements”) with Martin Richenhagen, its Chairman, President and Chief
Executive Officer, and each of Garry L. Ball, Andrew H. Beck, Norm L. Boyd, David L. Caplan, Gary
L. Collar, and Randall G. Hoffman, Senior Vice Presidents (each, a “Senior Vice President” and,
collectively, the “Senior Vice Presidents”). The Agreements have an effective date as of January
1, 2008.
Mr. Richenhagen’s Agreement provides for an initial three-year term, which commenced on July 21,
2004, with subsequent, automatic one-year renewal terms unless not renewed by the Company or
terminated. The Agreements with each of the Senior Vice Presidents continue in effect until
terminated. The Agreements provide for an initial annual base salary subject to annual reviews by
the Company and for other customary benefits, including participation in various incentive
compensation plans.
Under each of the Agreements, the executive may be entitled to receive severance and certain
benefits depending upon the basis for the termination of the executive’s employment. In the event
of the executive’s death, the executive is entitled to payment of his base salary for ninety days
following the month in which the death occurred and payment of his bonus and other incentive
benefits accrued through the end of the month in which the death occurred. Upon the incapacity or
termination for “cause” of the executive, the executive is entitled only to base salary then
accrued and, only in the case of incapacity, payment of his bonus and other benefits then accrued.
If the executive’s employment is terminated by the Company without “cause,” by the executive for
“good reason” or (solely in the case of Mr. Richenhagen) as a result of the Company’s not renewing
the Agreement, then the executive is entitled to payment of his base salary, bonus and other
benefits accrued through the date of termination, payment of his base salary for a period of (for
Messrs. Richenhagen, Beck and Boyd) two years or (for the other Senior Vice Presidents) one year
from the date of termination, and to payment of a pro rata portion of his bonus and other incentive
benefits for the year of his termination, as if he had remained employed for the entire year. The
terms “cause” and “good reason” are defined in the Agreements.
The Agreements also contain confidentiality, non-competition and non-solicitation covenants in
favor of the Company. Conformed copies of the Agreements are filed as Exhibits 10.1 through 10.7
to this Form 8-K and are incorporated herein by this reference.
On December 6, 2007, the Board of Directors of the Company approved certain other modifications to
the compensation arrangements for the Company’s executives and non-employee directors. The Board
of Directors approved the increase to $75,000 in value of the annual grant of restricted stock to
non-employee directors of the Company. A summary of non-employee director compensation is filed as
Exhibit 10.8 to this Form 8-K and is incorporated herein by this reference. The Board of Directors
also approved two retention-based $2,000,000 restricted stock awards for Mr. Richenhagen. The
first was granted on December 6, 2007, and totaled 28,839 shares and will vest over a five-year
period at the rate of 0% at the end of the first two years, 25% at the end of the third year, 25%
at the end of the fourth year, and 50% at the end of the fifth year. The second is expected to be
granted in December 2008 and will vest over a four-year period at the rate of 0% at the end of the
first year, 25% at the end of the second year, 25% at the end of the third year, and 50% at the end
of the fourth year. Vesting generally will be subject to Mr. Richenhagen’s continued employment by
the Company on the date of vesting, except under certain circumstances such as a change in control. Finally, the Board of Directors
also approved an increase in the maximum incentive bonus opportunity payable to certain of its
executives under the Company’s annual incentive compensation plan from 130% to 150% of base salary.
Item 9.01. Exhibits.
The following exhibits are filed with this report:
| 10.1 | Employment and Severance Agreement, as amended and restated, dated December 5, 2007 to be effective as of January 1, 2008, with Martin Richenhagen. | |
| 10.2 | Employment and Severance Agreement, as amended and restated, dated December 5, 2007 to be effective as of January 1, 2008, with Garry L. Ball. | |
| 10.3 | Employment and Severance Agreement, as amended and restated, dated December 5, 2007 to be effective as of January 1, 2008, with Andrew H. Beck. | |
| 10.4 | Employment and Severance Agreement, as amended and restated, dated December 5, 2007 to be effective as of January 1, 2008, with Norm L. Boyd. | |
| 10.5 | Employment and Severance Agreement, as amended and restated, dated December 5, 2007 to be effective as of January 1, 2008, with David L. Caplan. | |
| 10.6 | Employment and Severance Agreement, as amended and restated, dated December 5, 2007 to be effective as of January 1, 2008, with Gary L. Collar. | |
| 10.7 | Employment and Severance Agreement, as amended and restated, dated December 5, 2007 to be effective as of January 1, 2008, with Randall G. Hoffman. | |
| 10.8 | Director Compensation Summary, effective as of December 5, 2007. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| AGCO Corporation | ||||
| By: | /s/ Andrew H. Beck | |||
| Andrew H. Beck Senior Vice President and Chief Financial Officer |
||||
Dated: December 10, 2007 |
||||
Exhibit 10.1
EMPLOYMENT AND SEVERANCE AGREEMENT
AS AMENDED AND RESTATED
AS AMENDED AND RESTATED
This Employment and Severance Agreement (the “Agreement”), originally effective as of the 21st
day of July, 2004, is amended and restated this 5 day of December, 2007, to be effective as of
January 1, 2008, by AGCO CORPORATION, a Delaware corporation (the “Company”) and Martin Richenhagen
(the “Executive”). This Agreement amends, restates and supersedes the Employment and Severance
Agreement between the Company and the Executive effective as of the 21st day of July
2004.
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, upon the terms and conditions set forth in this Agreement.
(b) The employment term commenced on July 21, 2004 and shall continue in effect for an initial
three (3) year term. This Agreement shall automatically be extended for additional one (1) year
terms unless: (i) the Company notifies the Executive at least 60 days prior to the expiration of
the current term that this Agreement shall not be renewed, or (ii) the Agreement is terminated
pursuant to the provisions of Section 5.
| 2. | POSITION AND DUTIES. |
The Executive shall serve as President and Chief Executive of the Company and shall perform
such duties and responsibilities as may from time to time be prescribed by the Company’s board of
directors (the “Board”), provided that such duties and responsibilities are consistent with the
Executive’s position. The Executive shall perform and discharge faithfully, diligently and to the
best of his 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 Million Dollars ($1,000,000 USD), payable in equal semi-monthly installments throughout the
term of such employment subject to Section 5 hereof (except that the first and last semi-monthly
installments may be prorated, if necessary) 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 the Management Incentive
Compensation Plan and the Long-Term Incentive Plan that is implemented by the Company.
(c) EXECUTIVE NONQUALIFIED PENSION PLAN. During the term of this Agreement, the Executive
shall be entitled to participate in the AGCO Corporation Executive Nonqualified Pension Plan
(“SERP”), and the SERP shall be amended to provide for the following:
| (1) | For the purpose of determining years of credited service, the Executive shall be guaranteed the first five (5) years of service. Benefits shall be vested and portable if the Executive’s employment is terminated by the Company without Cause, by the Executive for Good Reason or by the Company by not renewing this Agreement, even if the Executive’s actual employment is less than five years. | ||
| (2) | In the event the Executive elects to terminate employment with the Company for reasons other than Good Reason, the benefits of the SERP shall not be portable. |
(d) OTHER BENEFITS. During the term of this Agreement, the Executive shall be entitled to
participate in the 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.
(e) FRINGE BENEFITS. The Company shall pay or reimburse the Executive promptly for all
reasonable and necessary expenses incurred by him in connection with his duties hereunder, upon
submission by the Executive to the Company of such written evidence of such expenses as the Company
may require. Throughout the term of this Agreement, the Company will provide the Executive with
the use of a vehicle for purposes within the scope of his employment and shall pay, or reimburse
the Executive for, all expenses for fuel, maintenance and insurance in connection with such use of
the automobile. In no event will any such reimbursements or payments under this Subsection 3(e) be
made, if at all, later than the last day of the Executive’s taxable year next following the
Executive’s taxable year in which the Executive incurs the expense. The Company further agrees
that the Executive shall be entitled to four (4) weeks of vacation in any year of the term of
employment hereunder, subject to the terms of the Company’s vacation policy.
| 4. | RESTRICTIVE COVENANTS. |
(a) ACKNOWLEDGMENTS. The Executive acknowledges that as an Executive Officer 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,
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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. |
(i) “Business of Company” means designing, manufacturing, marketing, and distributing
agricultural equipment.
(ii) “Material Contact” as used in the non-solicitation provision below means personal
contact or the supervision of the efforts of those who have personal contact with an
existing or potential Customer or Vendor in an effort to further or create a business
relationship between the Company and such existing or potential Customer or Vendor.
(iii) “Confidential Information” means information about the Company, its Executives,
and Customers which is not generally known outside of the Company, which the Executive
learns of in connection with the Executive’s employment with the Company, and which would be
useful to competitors of the Company or potentially harmful to the Company’s reputation.
Confidential Information includes, but is not limited to: (1) business and employment
policies, marketing methods and the targets of those methods, finances, business plans,
promotional materials and price lists; (2) the terms upon which the Company hires employees
and provides services to its Customers; (3) the nature, origin, composition and development
of the Company’s products and services; and (4) the manner in which the Company provides
products and services to its Customers.
(iv) “Trade Secrets” means Confidential Information which meets the additional
requirements of the Georgia Trade Secrets Act.
(v) “Territory” means those countries and areas as more particularly set forth on
Exhibit A attached hereto.
(c) COVENANT OF CONFIDENTIALITY. During the term of this Agreement, the Executive agrees only
to use and disclose Confidential Information in connection with his duties hereunder and to
otherwise maintain the secrecy of the same. The Executive agrees that for a period of five years
following the cessation of his employment for any reason, he shall not directly or indirectly
divulge or make use of any Confidential Information or Trade Secrets of the Company without prior
written consent of the Company. The Executive further agrees that if he is questioned about
information subject to this Agreement by anyone not authorized to receive such information, he will
promptly notify the Chairman of the Board. This Agreement does not limit the remedies available
under common or statutory law, which may impose longer duties of non-disclosure. The Executive
will immediately notify the Chairman of the Board if he receives any subpoenas which could require
the disclosure of Confidential Information, so that the Company may take whatever actions it deems
necessary to protect its interests.
(d) COVENANT OF NON-COMPETITION. The Executive agrees that while employed by the Company and
for a period of twenty-four (24) months following the
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cessation of his employment for any reason, he will not compete with the Business of Company
by performing services of the same or similar type as those he performed for the Company as an
employee, contractor, consultant, officer, director or agent for any person or entity engaged in
the Business of Company. Likewise, the Executive will not perform activities of the type which in
the ordinary course of business would involve the utilization of Confidential Information or Trade
Secrets protected from disclosure by Section 4 (c) of this Agreement. This paragraph restricts
competition only within the Territory.
(e) COVENANT OF NON-SOLICITATION. The Executive agrees that while employed by the Company and
for a period of twenty-four (24) months following the cessation of his employment for any reason,
he will not directly or indirectly solicit or attempt to solicit any business in competition with
the Business of Company from any of the Customers with whom the Executive had Material Contact
within the last 18 months of his employment with the Company. The Executive further agrees that
for a period of twenty-four (24) months following the cessation of his employment, he will not
directly or indirectly solicit or attempt to solicit any Vendors of the Company with whom he had
Material Contact during the last 18 months of his employment with the Company to provide services
to any person or entity which competes with the Business of Company.
(f) COVENANT OF NON-RECRUITMENT. The Executive agrees that while employed by the Company and
for a period of twenty-four (24) months following the cessation of his employment for any reason,
he will not directly or indirectly solicit or attempt to solicit any other employee of the Company
for the purpose of encouraging, enticing, or causing said employee to voluntarily terminate
employment with the Company.
(g) COVENANT TO RETURN PROPERTY AND INFORMATION. The Executive agrees to return all of the
Company’s property within seven (7) days following the cessation of his employment for any reason.
Such property includes, but is not limited to, the original and any copy (regardless of the manner
in which it is recorded) of all information provided by the Company to the Executive, or which the
Executive has developed or collected in the scope of his employment with the Company, as well as
all Company-issued equipment, supplies, accessories, vehicles, keys, instruments, tools, devices,
computers, cell phones, pagers, materials, documents, plans, records, notebooks, drawings, or
papers.
(h) ASSIGNMENT OF WORK PRODUCT AND INVENTIONS. The Executive hereby assigns and grants to the
Company (and will upon request take any actions needed to formally assign and grant to the Company
and/or obtain patents, trademark registrations or copyrights belonging to the Company) the sole and
exclusive ownership of any and all inventions, information, reports, computer software or programs,
writings, technical information or work product collected or developed by the Executive, alone or
with others, during the term of the Executive’s employment. This duty applies whether or not the
forgoing inventions or information are made or prepared in the course of employment with the
Company, so long as such inventions or information relate to the Business of Company and have been
developed in whole or in part during the term of the Executive’s employment. The Executive agrees
to advise the Company in writing of each invention that Executive, alone or with others, makes or
conceives during the term of Executive’s employment. Inventions which the Executive developed
before the Executive came to work for the Company, if any, are as follows:
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(i) REMEDIES FOR VIOLATION OF RESTRICTIVE COVENANTS. The Executive acknowledges that the
Company would suffer irreparable harm if the Executive fails to comply with the foregoing, and that
the Company would be entitled to any appropriate relief, including money damages, injunctive and
other equitable relief and attorneys’ fees. The Executive agrees that the pendency of any claim
whatsoever against the Company shall not constitute a defense to the enforcement of this
Noncompetition Agreement by the Company.
(j) SEVERABILITY. In the event that any one or more of the provisions of these restrictive
covenants shall be held to be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
Moreover, if any one or more of the provisions contained in these restrictive covenants shall be
held to be excessively broad as to duration, activity or subject, the parties authorize the Court
in which such action is pending to modify said covenants and enforce them to the extent that the
Court deems reasonable.
| 5. | TERMINATION. |
(a) DEATH. This Agreement shall terminate upon the death of the Executive, provided, however,
that for purposes of the payment of Base Salary to the Executive, 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) DISABILITY. Executive’s employment and all obligations of the Company hereunder shall
terminate upon a finding that the Executive is disabled under the Company’s group long term
disability plan.
(c) CAUSE. The Company may terminate the Executive’s employment hereunder for Cause by giving
written Notice of Termination to the Executive. For the purposes of this Agreement, the Company
shall have “Cause” to terminate the Executive’s employment hereunder upon: (i) the conviction of
Executive of, or the entry of a plea of guilty, first offender probation before judgment, or nolo
contendere by Executive to, any felony; (ii) fraud, misappropriation or embezzlement by Executive;
(iii) Executive’s willful failure or gross negligence in the performance of his assigned duties for
the Company, which failure or negligence continues for more than or was not remedied within thirty
(30) calendar days following Executive’s receipt of written notice of such willful failure or gross
negligence; (iv) Executive’s failure to follow reasonable and lawful directives of the Board or his
breach of his fiduciary duty to the Company, which failure is not remedied within thirty (30)
calendar days following Executive’s receipt of written notice of such failure; (v) any act or
omission of Executive that has a demonstrated and material adverse impact on the Company’s business
or reputation for honesty and fair dealing, other than an act or failure to act by Executive in
good faith and without reason to believe that such act or failure to act would adversely impact on
the Company’s business or reputation for honesty and fair dealing; or (vi) the breach by Executive
of any material term of this Agreement, which breach continues for more than or was not remedied
within thirty (30) calendar days following Executive’s receipt of written notice of such breach.
(d) WITHOUT CAUSE; GOOD REASON.
(i) The Company may terminate the Executive’s employment hereunder without Cause, by
giving written Notice of Termination (as defined in Section 5(e)) to the Executive.
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(ii) The Executive may terminate his employment hereunder, by giving written Notice of
Termination to the Company. For the purposes of this Agreement, the Executive shall have
“Good Reason” to terminate his employment hereunder upon (a) a substantial reduction in the
Executive’s aggregate Base Salary and annual incentive compensation taken as a whole,
excluding any reductions caused by the performance of the Company or the Executive,
including but not limited to, the failure by the Executive to achieve performance targets
established from time to time by the Board and/or under the Long Term Incentive Plan or from
below budget performance by the Company, or (b) the Company’s failure to make payments of
Base Pay and incentive compensation, but only upon notice of such failure given by the
Executive and the subsequent failure of the Company to cure the non-payment within thirty
(30) days of such notice.
(e) NOTICE OF TERMINATION. Any termination by the Company pursuant to the Subsections (b),
(c) or (d)(i) above or by the Executive pursuant to Subsection (d)(ii) above, shall be communicated
by written Notice of Termination from the party issuing such notice to the other party hereto. 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 the Notice of Termination shall not be dated earlier than ninety (90) days
from the date such Notice is delivered or mailed to the applicable party.
(f) OBLIGATION TO PAY. Except upon termination for Cause, voluntary termination by the
Executive without Good Reason, or termination as a result of death or disability, and further
subject to Sections 6 and 16 below, the Company shall (i) pay the compensation specified in this
Subsection 5(f) to the Executive for the period specified in this Subsection 5(f), (ii) continue to
provide, no less frequently than monthly, life insurance benefits during the remainder of the
applicable period, including the Severance Period set forth in this Subsection 5(f), and (iii) if
and to the extent the Executive timely elects COBRA continuation coverage, pay the Executive on a
monthly basis the cost of COBRA premiums for a period of 18 months or such lesser period as the
Executive continues to have COBRA continuation coverage. If the Executive’s employment shall be
terminated by reason of death, the estate of the Executive shall be paid all Base Salary and
reimbursements otherwise payable to the Executive through the end of the third month after the
month in which the death of the Executive occurred, plus 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, on the same basis as if the Executive had continued employment through such
times, and the Company shall have no further obligations to the Executive under this Agreement. If
the Executive’s employment is terminated by reason of disability as determined under the Company’s
long term disability plan, the Executive or the person charged with legal responsibility for the
Executive’s estate shall be paid all Base Salary and reimbursements and payments otherwise payable
to the Executive, including the bonus and other benefits accrued or accruable to the Executive, on
the same basis as if the Executive had continued employment through the date of disability, 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 reimbursements
otherwise payable to the Executive and the Company shall have no further obligations to the
Executive under this
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Agreement. If the Executive’s employment shall be terminated by the Company without Cause, by
the Executive for Good Reason or by the Company by not renewing the Agreement following the initial
term or any subsequent term, the Executive shall be paid all Base Salary and reimbursements and
payments 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 (x) continue to pay the Executive the Base Salary (at the rate in effect on
the date of such termination) for a period of two (2) years from the date of such termination (such
two (2) year period being referred to hereinafter as the “Severance Period”) on the same basis as
if Executive had continued employment during the Severance Period and (y) pay the Executive a pro
rata portion of the bonus or other incentive benefits to which the Executive would have been
entitled for the year of termination had the Executive remained employed for the entire year which
incentive compensation shall be payable at the time incentive compensation is payable generally
under the applicable incentive plans; provided, however, that notwithstanding the foregoing, the
Executive shall not be entitled to any severance payments under clauses (x) or (y) of this sentence
upon and after reaching age 65. The Executive shall have no further right to receive any other
compensation, benefits or perquisites after the date of termination of employment except as
determined under the terms of this Agreement or any applicable employee benefit plans or programs
of the Company or under applicable law.
6. CONDITIONS APPLICABLE TO SEVERANCE PERIOD; MITIGATION OF DAMAGES
(a) If during the Severance Period, the Executive breaches his obligations under Section 4
above, the Company may, upon written notice to the Executive, terminate the Severance Period and
cease to make any further payments or provide any benefits described in Subsection 5(f).
(b) Although the Executive shall not be required to mitigate the amount of any payment
provided for in Subsection 5(f) by seeking other employment, any such payments shall be reduced by
any amounts which the Executive receives or is entitled to receive from another employer with
respect to the Severance Period. The Executive shall promptly notify the Company in writing in the
event that other employment is obtained during the Severance Period.
7. 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
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
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in the case of the Executive to:
Martin Richenhagen
2778 Grey Moss Pass
Duluth, Georgia 30097
2778 Grey Moss Pass
Duluth, Georgia 30097
or to such other address as either party shall designate by giving written notice of such change to
the other party.
8. 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 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 7 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 8, 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: ___________________________ | Company initials: ___________________________ |
8
9. 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.
10. 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.
11. 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.
12. 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
Section 5 hereof relating to payments and termination of the Executive’s employment hereunder shall
survive such termination and shall be binding upon the Company.
13. 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.
14. ENTIRE AGREEMENT. This Agreement constitutes the full agreement and understanding of the
parties hereto with respect to the subject matter hereof and all prior or contemporaneous
agreements or understandings are merged herein. The parties to this Agreement each acknowledge
that both of them and their respective agents and advisors were active in the negotiation and
drafting of the terms of this Agreement.
15. 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.
16. DEFERRED COMPENSATION PLAN OMNIBUS PROVISIONS. Notwithstanding any other provision of this
Agreement, it is intended that any payment or benefit which is provided pursuant to or in
connection with this Agreement which is considered to be deferred compensation subject to Section
409A of the Internal Revenue Code of 1986, as amended (the “Code”) shall be provided and paid in a
manner, and at such time, including without limitation payment and provision of benefits only in
connection with a permissible payment event contained in Section 409A (e.g., death or separation
from service from the Company and its affiliates as defined for purposes of Section 409A of the
Code), and in such form, as complies with the applicable requirements of Section 409A of the Code,
to avoid the unfavorable tax consequences provided therein for non-compliance. For purposes of
this Agreement, all rights to payments and benefits hereunder shall be treated as rights to receive
a
9
series of separate payments and benefits to the fullest extent allowed by Section 409A of the
Code. If Executive is a “specified employee” (as defined in Section 409A of the Code) and any of
the Company’s stock is publicly traded on an established securities market or otherwise, then
payment of any amount or provision of any benefit under this Agreement which is considered to be
deferred compensation subject to Section 409A of the Code shall be deferred for six (6) months as
required by Section 409A(a)(2)(B)(i) of the Code (the “409A Deferral Period”). In the event such
payments are otherwise due to be made in installments or periodically during the 409A Deferral
Period, the payments which would otherwise have been made in the 409A Deferral Period shall be
accumulated and paid in a lump sum as soon as the 409A Deferral Period ends, and the balance of the
payments shall be made as otherwise scheduled. In the event benefits are required to be deferred,
any such benefit may be provided during the 409A Deferral Period at Executive’s expense, with
Executive having a right to reimbursement from the Company once the 409A Deferral Period ends, and
the balance of the benefits shall be provided as otherwise scheduled. For purposes of this
Agreement, any termination of employment will be read to mean a “separation from service” within
the meaning of Section 409A of the Code where it is reasonably anticipated that no further services
would be performed after such date or that the level of bona fide services Executive would perform
after that date (whether as an employee or independent contractor) would permanently decrease to
less than fifty percent (50%) of the average level of bona fide services performed over the
immediately preceding thirty-six (36)-month period.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
| AGCO CORPORATION |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| EXECUTIVE |
||||
10
EXHIBIT A
DEFINITION OF “TERRITORY”
PURSUANT TO SECTION 4(b)(v)
DEFINITION OF “TERRITORY”
PURSUANT TO SECTION 4(b)(v)
| AGCO RECOGNISED | ||||
| CODE | COUNTRY | DISTRIBUTION / REPRESENTATIVE | ||
AF
|
AFGHANISTAN | Y | ||
AL
|
ALBANIA | Y | ||
DZ
|
ALGERIA | Y | ||
AO
|
ANGOLA | Y | ||
AG
|
ANTIGUA AND BARBUDA | Y | ||
AR
|
ARGENTINA | Y | ||
AU
|
AUSTRALIA | Y | ||
AT
|
AUSTRIA | Y | ||
AY
|
AZORES | Y | ||
BH
|
BAHRAIN | Y | ||
BD
|
BANGLADESH | Y | ||
BB
|
BARBADOS, WEST INDIES | Y | ||
BE
|
BELGIUM | Y | ||
BJ
|
BENIN | Y | ||
BO
|
BOLIVIA | Y | ||
BA
|
BOSNIA | Y | ||
BR
|
BRAZIL | Y | ||
BG
|
BULGARIA | Y | ||
BI
|
BURUNDI | Y | ||
CM
|
CAMEROON | Y | ||
CA
|
CANADA | Y | ||
CF
|
CENTRAL AFRICAN REPUBLIC | Y | ||
CL
|
CHILE | Y | ||
CN
|
CHINA | Y | ||
CO
|
COLOMBIA | Y | ||
CG
|
CONGO | Y | ||
CD
|
CONGO, DEM REP | Y | ||
CR
|
COSTA RICA | Y | ||
HR
|
CROATIA | Y | ||
CY
|
CYPRUS | Y | ||
CZ
|
CZECH REPUBLIC | Y | ||
DK
|
DENMARK | Y | ||
DJ
|
DJIBOUTI | Y | ||
EC
|
ECUADOR | Y | ||
EG
|
EGYPT | Y | ||
SV
|
EL SALVADOR | Y | ||
EE
|
ESTONIA | Y | ||
ET
|
ETHIOPIA | Y | ||
FJ
|
FIJI | Y | ||
FI
|
FINLAND | Y | ||
11
| AGCO RECOGNISED | ||||
| CODE | COUNTRY | DISTRIBUTION / REPRESENTATIVE | ||
FR
|
FRANCE | Y | ||
GF
|
FRENCH GUIANA | Y | ||
PF
|
FRENCH POLYNESIA | Y | ||
GA
|
GABON | Y | ||
GM
|
GAMBIA | Y | ||
GE
|
GEORGIA | Y | ||
DE
|
GERMANY | Y | ||
GH
|
GHANA | Y | ||
GR
|
GREECE | Y | ||
GP
|
GUADELOUPE | Y | ||
GT
|
GUATEMALA | Y | ||
GY
|
GUYANA | Y | ||
HT
|
HAITI | Y | ||
HN
|
HONDURAS | Y | ||
HK
|
HONG KONG | Y | ||
HU
|
HUNGARY | Y | ||
IR
|
I.R.O. IRAN | Y | ||
IS
|
ICELAND | Y | ||
IN
|
INDIA | Y | ||
ID
|
INDONESIA | Y | ||
IQ
|
IRAQ | Y | ||
IE
|
IRELAND | Y | ||
IL
|
ISRAEL | Y | ||
IT
|
ITALY | Y | ||
CI
|
IVORY COAST | Y | ||
JM
|
JAMAICA, WEST INDIES | Y | ||
JP
|
JAPAN | Y | ||
JO
|
JORDAN | Y | ||
KZ
|
KAZAKHSTAN | Y | ||
KE
|
KENYA | Y | ||
KW
|
KUWAIT | Y | ||
LV
|
LATVIA | Y | ||
LB
|
LEBANON | Y | ||
LY
|
LIBYA | Y | ||
LT
|
LITHUANIA | Y | ||
LU
|
LUXEMBOURG | Y | ||
MK
|
MACEDONIA | Y | ||
MK
|
MACEDONIA | Y | ||
MG
|
MADAGASCAR | Y | ||
MW
|
MALAWI | Y | ||
MY
|
MALAYSIA | Y | ||
ML
|
MALI | Y | ||
MQ
|
MARTINIQUE | Y | ||
MU
|
MAURITIUS | Y | ||
12
| AGCO RECOGNISED | ||||
| CODE | COUNTRY | DISTRIBUTION / REPRESENTATIVE | ||
MX
|
MEXICO | Y | ||
MA
|
MOROCCO | Y | ||
MZ
|
MOZAMBIQUE | Y | ||
MM
|
MYANMAR | Y | ||
NP
|
NEPAL | Y | ||
NL
|
NETHERLANDS | Y | ||
NC
|
NEW CALEDONIA | Y | ||
NZ
|
NEW ZEALAND | Y | ||
NG
|
NIGERIA | Y | ||
NO
|
NORWAY | Y | ||
OM
|
OMAN | Y | ||
PK
|
PAKISTAN | Y | ||
PS
|
PALESTINE | Y | ||
PG
|
PAPUA NEW GUINEA | Y | ||
PE
|
PERU | Y | ||
PH
|
PHILIPPINES | Y | ||
PL
|
POLAND | Y | ||
PT
|
PORTUGAL | Y | ||
PR
|
PUERTO RICO | Y | ||
QA
|
QATAR | Y | ||
PA
|
REP. OF PANAMA | Y | ||
ZM
|
REP. OF ZAMBIA | Y | ||
RO
|
ROMANIA | Y | ||
RU
|
RUSSIA | Y | ||
RW
|
RWANDA | Y | ||
WS
|
SAMOA | Y | ||
SA
|
SAUDI ARABIA | Y | ||
SN
|
SENEGAL | Y | ||
CS
|
SERBIA AND MONTENEGRO | Y | ||
SC
|
SEYCHELLES | Y | ||
SG
|
SINGAPORE | Y | ||
SK
|
SLOVAKIA | Y | ||
SI
|
SLOVENIA | Y | ||
SB
|
SOLOMON ISLANDS | Y | ||
ZA
|
SOUTH AFRICA | Y | ||
KR
|
SOUTH KOREA | Y | ||
ES
|
SPAIN | Y | ||
LK
|
SRI LANKA | Y | ||
SD
|
SUDAN | Y | ||
SR
|
SURINAME | Y | ||
SE
|
SWEDEN | Y | ||
CH
|
SWITZERLAND | Y | ||
SY
|
SYRIA | Y | ||
TW
|
TAIWAN | Y | ||
13
| AGCO RECOGNISED | ||||
| CODE | COUNTRY | DISTRIBUTION / REPRESENTATIVE | ||
TZ
|
TANZANIA | Y | ||
TH
|
THAILAND | Y | ||
CD
|
THE DEM. REP. OF THE CONGO | Y | ||
TG
|
TOGO | Y | ||
TO
|
TONGA | Y | ||
TT
|
TRINIDAD AND TOBAGO | Y | ||
TN
|
TUNISIA | Y | ||
TR
|
TURKEY | Y | ||
UG
|
UGANDA | Y | ||
UA
|
UKRAINE | Y | ||
AE
|
UNITED ARAB EMIRATES | Y | ||
GB
|
UNITED KINGDOM | Y | ||
US
|
UNITED STATES | Y | ||
UY
|
URUGUAY | Y | ||
VN
|
VIETNAM | Y | ||
ZW
|
ZIMBABWE | Y | ||
14
Exhibit 10.2
EMPLOYMENT AND SEVERANCE AGREEMENT
AS AMENDED AND RESTATED
AS AMENDED AND RESTATED
This Employment and Severance Agreement (the “Agreement”), originally effective as of the 1st
day of June 2001, is amended and restated this 5 day of December, 2007, to be effective as of
January 1, 2008, by AGCO CORPORATION, a Delaware corporation (the “Company”), and Garry L. Ball
(the “Executive”). This Agreement amends, restates and supersedes the Employment and Severance
Agreement between the Company and the Executive effective as of the 1st day of June 2001.
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 commenced on June 1, 2001 and shall continue in effect until
terminated in accordance with Section 5 or any other provision of the Agreement.
2. POSITION AND DUTIES.
The Executive shall serve as an Executive Officer of the Company and shall perform such duties
and responsibilities as may from time to time be prescribed by the Company’s board of directors
(the “Board”), provided that such duties and responsibilities are consistent with the Executive’s
position. The Executive shall perform and discharge faithfully, diligently and to the best of his
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 Three Hundred and Twenty Thousand Dollars ($320,000.00), payable in equal semi-monthly
installments throughout the term of such employment subject to Section 5 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 the
Management Incentive Compensation Plan implemented by the Company.
(c) OTHER BENEFITS. During the term of this Agreement, the Executive shall be entitled to
participate in the long term incentive 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 promptly 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, or reimburse the Executive for, all
expenses for fuel, maintenance and insurance in connection with such use of the automobile. In no
event will any such reimbursements or payments under this Subsection 3(d) be made, if at all, later
than the last day of the Executive’s taxable year next following the Executive’s taxable year in
which the Executive incurs the expense. The Company further agrees that Executive shall be
entitled to four (4) weeks of vacation in any year of the term of employment hereunder. Nothing
paid to the Executive under any such Company plans or arrangements shall be deemed to be in lieu of
compensation to the Executive hereunder.
4. NON-DISCLOSURE, NON-COMPETITION AND NON-SOLICITATION COVENANTS.
(a) ACKNOWLEDGEMENTS. The Executive acknowledges that as an Executive Officer 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 terms shall have the following
meanings:
(i) “COMPETITIVE POSITION” shall mean (i) the Executive’s direct or indirect equity
ownership (excluding equity ownership of less than one percent (1%) or control of all or any
portion of a Competitor, or (ii) any employment, consulting, partnership, advisory,
directorship, agency, promotional or independent contractor arrangement between the
Executive and any Competitor whereby the Executive is required to perform executive level
services substantially similar to those that he will perform for the Company as an Executive
Officer.
2
(ii) “COMPETITOR” of the Company shall refer to any person or entity engaged, wholly or
partly, in the business of manufacturing and distributing farm equipment machinery and
replacement parts.
(iii) “CONFIDENTIAL INFORMATION” shall mean the proprietary and confidential data or
information of the Company, other than “Trade Secrets” (as defined below), which is of
tangible or intangible value to the Company and is not public information or is not
generally known or available to the Company’s competitors.
(iv) “TRADE SECRETS” shall mean information of the Company, including, but not limited
to, technical or non-technical data, formulas, patterns, compilations, programs, devices,
methods, techniques, drawings, processes, financial data, financial plans, products plans,
or lists of actual or potential customers or suppliers, which: (a) derives economic value,
actual or potential, from not being generally known to, and not being readily ascertainable
by proper means by, other persons who can obtain economic value from its disclosure or use;
and (b) is the subject of efforts that are reasonable under the circumstances to maintain
its secrecy.
(v) “WORK PRODUCT” shall mean all work product, property, data, documentation,
“know-how”, concepts or plans, inventions, improvements, techniques, processes or
information of any kind, relating to the Company and its business prepared, conceived,
discovered, developed or created by the Executive for the Company or any of the Company’s
customers.
(c) NONDISCLOSURE; OWNERSHIP OF PROPRIETARY PROPERTY.
(i) The Executive hereby covenants and agrees that: (i) with regard to information
constituting a Trade Secret, at all times during the Executive’s employment with the Company
and all times thereafter during which such information continues to constitute a Trade
Secret; and (ii) with regard to any Confidential Information, at all times during the
Executive’s employment with the Company and for three (3) years after the termination of the
Executive’s employment with the Company, the Executive shall regard and treat all
information constituting a Trade Secret or Confidential Information as strictly confidential
and wholly owned by the Company and will not, for any reason in any fashion, either directly
or indirectly, use, sell, lend, lease, distribute, license, give, transfer, assign, show,
disclose, disseminate, reproduce, copy, appropriate or otherwise communicate any such
information to any party for any purpose other than strictly in accordance with the express
terms of this Agreement and other than as may be required by law.
(ii) To the greatest extent possible, any Work Product shall be deemed to be “work made
for hire” (as defined in the Copyright Act, 17 U.S.C.A. ss. 101 et seq., as amended) and
owned exclusively by the Company. The Executive hereby unconditionally and irrevocably
transfers and assigns to the Company all rights, title and interest the Executive may
currently have or in the future may have by operation of law or otherwise in or to any Work
Product, including, without limitation, all patents, copyrights, trademarks, service marks
and other intellectual property rights. The Executive agrees to execute and deliver to the
Company any transfers, assignments, documents or other instruments which the Company may
deem necessary or appropriate
3
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.
(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 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, Western Europe, Brazil and Canada. The Executive and the Company each acknowledge that
the scope of the Restricted Territory is reasonable because (1) the Company is conducting
substantial business in all fifty states (as well as several foreign countries), (2) the Executive
occupies one of the top executive positions with the Company, and (3) the Executive will be
carrying out his employment responsibilities in all locations where the Company is doing business.
(e) NON-SOLICITATION OF CUSTOMERS. The Executive agrees that during the term of his
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 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.
4
(f) NON-SOLICITATION OF COMPANY PERSONNEL. The Executive 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 Executive’s violation of any of
the covenants in this Section 4 would not be an adequate or proper remedy and that should the
Executive violate or threaten to violate any of the provisions of such covenants, the Company or
its successors or assigns shall be entitled to obtain a temporary or permanent injunction against
Executive in any court having jurisdiction prohibiting any further violation of any such covenants,
in addition to any award or damages, compensatory, exemplary or otherwise, for such violation, if
any.
(h) PARTIAL ENFORCEMENT. The Company has attempted to limit the rights of the Executive to
compete only to the extent necessary to protect the Company from unfair competition. The Company,
however, agrees that, if the scope of enforceability of these restrictive covenants is in any way
disputed at any time, a court or other trier of fact may modify and enforce the covenant to the
extent that it believes to be reasonable under the circumstances existing at the time.
5. TERMINATION.
(a) DEATH. The Executive’s employment hereunder shall terminate upon the death of the
Executive, provided, however, that for purposes of the payment of Base Salary to the Executive
under this Agreement the death of the Executive shall be deemed to have occurred ninety (90) days
from the last day of the month in which the death of the Executive shall have occurred.
(b) INCAPACITY. The Company may terminate the Executive’s employment hereunder at the end of
any calendar month by giving written Notice of Termination to the Executive in the event of the
Executive’s incapacity due to physical or mental illness which prevents the proper performance of
the duties of the Executive set forth herein or established pursuant hereto for a substantial
portion of any six (6) month period of the Executive’s term of employment hereunder. Any question
as to the existence, extent or potentiality of illness or incapacity of Executive upon which
Company and Executive cannot agree shall be determined by a qualified independent physician
selected by the Company and
5
approved by Executive (or, if Executive is unable to give such approval, by any adult member
of the immediate family or the duly appointed guardian of the Executive). The determination of
such physician shall be certified in writing to the Company and to the Executive and shall be final
and conclusive for all purposes of this Agreement.
(c) CAUSE. The Company may terminate the Executive’s employment hereunder for Cause by giving
written Notice of Termination to the Executive. For the purposes of this Agreement, the Company
shall have “Cause” to terminate the Executive’s employment hereunder upon: (i) the Executive’s
habitual drunkenness or chronic substance abuse; (ii) a willful failure by the Executive to
materially perform and discharge the duties and responsibilities of the Executive hereunder; (iii)
any breach by the Executive of the provisions of Section 4 hereof; (iv) any misconduct by the
Executive that is materially injurious to the Company; or (v) a conviction of a felony involving
the personal dishonesty or moral turpitude of the Executive.
(d) WITHOUT CAUSE; GOOD REASON.
(i) The Company may terminate the Executive’s employment hereunder without Cause, by
giving written Notice of termination to the Executive.
(ii) The Executive may terminate his employment hereunder, by giving written Notice of
Termination to the Company. For the purposes of this Agreement, the Executive shall have
“Good Reason” to terminate his employment hereunder upon (and without the written consent of
the Executive) (a) a reduction in the Executive’s base salary or 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
material breach by the Company of this Agreement.
(e) NOTICE OF TERMINATION. Any termination by the Company pursuant to the Subsections (b),
(c) or (d)(i) above or by the Executive pursuant to Subsection (d)(ii) above, shall be communicated
by written Notice of Termination from the party issuing such notice to the other party hereto. 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 the Notice of Termination shall not be dated earlier than ninety (90) days
from the date such Notice is delivered or mailed to the applicable party.
(f) OBLIGATION TO PAY. Except upon voluntary termination by the Executive without Good
Reason, termination by the Company for Cause, or termination as a result of death or incapacity and
subject to Sections 6 and 16 below, the Company shall (i) pay the compensation specified in this
Subsection 5(f) to the Executive for the period specified in this Subsection 5(f), (ii) continue to
provide, no less frequently than monthly, life insurance benefits during the remainder of the
applicable period, including the Severance Period set forth in this Subsection 5(f), and (iii) if
and to the extent the Executive timely elects COBRA continuation coverage, pay the Executive on a
monthly basis the cost of COBRA premiums for a period of 18 months or such lesser period as the
Executive continues to have COBRA
6
continuation coverage. If the Executive’s employment shall be terminated by reason of death,
the estate of the Executive shall be paid all Base Salary and reimbursements 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, on the same basis as if
the Executive had continued employment through such times, 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 Base Salary and reimbursements and payments 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, on the same basis as if the
Executive had continued employment through such time, 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 reimbursements otherwise payable to the
Executive, and the Company shall have no further obligations to the Executive under this Agreement.
If the Executive’s employment shall be terminated by the Company, without cause, or by the
Executive for Good Reason, the Executive shall be paid all Base Salary and reimbursements and
payments 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 (x) continue to pay the Executive the Base Salary (at the rate in effect on
the date of such termination) for a period of one (1) year from the date of such termination (such
one (1) year period being referred to hereinafter as the “Severance Period”) on the same basis as
if Executive had continued employment during the Severance Period and (y) pay the Executive a pro
rata portion of the bonus or other incentive benefits to which the Executive would have been
entitled for the year of termination, had the Executive remained employed for the entire year which
incentive compensation shall be payable at the time incentive compensation is payable generally
under the applicable incentive plans; provided, however, that notwithstanding the foregoing, the
Executive shall not be entitled to any severance payments under (x) and (y) upon and after reaching
age 65. The Executive shall have no further right to receive any other compensation benefits or
perquisites after the date of termination of employment except as determined under the terms of
this Agreement or any applicable employee benefit plans or programs of the Company or under
applicable law.
6. CONDITIONS APPLICABLE TO SEVERANCE PERIOD; MITIGATION OF DAMAGES
(a) If during the Severance Period, the Executive breaches his obligations under Section 4
above, the Company may, upon written notice to the Executive, terminate the Severance Period and
cease to make any further payments or provide any benefits described in Subsection 5(f).
(b) Although the Executive shall not be required to mitigate the amount of any payment
provided for in Subsection 5(f) by seeking other employment, any such payments shall be reduced by
any amounts which the Executive receives or is entitled to receive from another employer with
respect to the Severance Period. The Executive shall promptly notify the Company in writing in the
event that other employment is obtained during the Severance Period.
7
7. 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
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
in the case of the Executive to:
Garry L. Ball
6380 Sunbriar Drive
Cumming, Georgia 30040
6380 Sunbriar Drive
Cumming, Georgia 30040
or to such other address as either party shall designate by giving written notice of such change to
the other party.
8. 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 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 7 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 8, 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
8
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:
|
Company initials: | |||||||||
9. 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.
10. 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.
11. 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.
12. SURVIVAL. The provisions of Section 4 hereof shall survive the termination of Executive’s
employment and shall be binding upon the Executive’s personal or legal representative, executors,
administrators, successors, heirs, distributee, devisees and legatees and the provisions of Section
5 hereof relating to payments and termination of the Executive’s employment hereunder shall survive
such termination and shall be binding upon the Company.
13. 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.
14. ENTIRE AGREEMENT. This Agreement constitutes the full agreement and understanding of the
parties hereto with respect to the subject matter hereof and all prior or contemporaneous
agreements or understandings are merged herein. The parties to this Agreement each acknowledge
that both of them and their respective agents and advisors were active in the negotiation and
drafting of the terms of this Agreement.
15. 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.
16. DEFERRED COMPENSATION PLAN OMNIBUS PROVISIONS. Notwithstanding any other provision of this
Agreement, it is intended that any payment or benefit which is provided pursuant to or in
connection with this Agreement which is considered to be deferred compensation subject to Section
409A of the Internal Revenue Code of 1986, as
9
amended (the “Code”) shall be provided and paid in a manner, and at such time, including
without limitation payment and provision of benefits only in connection with a permissible payment
event contained in Section 409A (e.g., death or separation from service from the Company and its
affiliates as defined for purposes of Section 409A of the Code), and in such form, as complies with
the applicable requirements of Section 409A of the Code, to avoid the unfavorable tax consequences
provided therein for non-compliance. For purposes of this Agreement, all rights to payments and
benefits hereunder shall be treated as rights to receive a series of separate payments and benefits
to the fullest extent allowed by Section 409A of the Code. If Executive is a “specified employee”
(as defined in Section 409A of the Code) and any of the Company’s stock is publicly traded on an
established securities market or otherwise, then payment of any amount or provision of any benefit
under this Agreement which is considered to be deferred compensation subject to Section 409A of the
Code shall be deferred for six (6) months as required by Section 409A(a)(2)(B)(i) of the Code (the
“409A Deferral Period”). In the event such payments are otherwise due to be made in installments
or periodically during the 409A Deferral Period, the payments which would otherwise have been made
in the 409A Deferral Period shall be accumulated and paid in a lump sum as soon as the 409A
Deferral Period ends, and the balance of the payments shall be made as otherwise scheduled. In the
event benefits are required to be deferred, any such benefit may be provided during the 409A
Deferral Period at Executive’s expense, with Executive having a right to reimbursement from the
Company once the 409A Deferral Period ends, and the balance of the benefits shall be provided as
otherwise scheduled. For purposes of this Agreement, any termination of employment will be read to
mean a “separation from service” within the meaning of Section 409A of the Code where it is
reasonably anticipated that no further services would be performed after such date or that the
level of bona fide services Executive would perform after that date (whether as an employee or
independent contractor) would permanently decrease to less than fifty percent (50%) of the average
level of bona fide services performed over the immediately preceding thirty-six (36)-month period.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
AGCO CORPORATION |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| EXECUTIVE |
||||
10
Exhibit 10.3
EMPLOYMENT AND SEVERANCE AGREEMENT
AS AMENDED AND RESTATED
AS AMENDED AND RESTATED
This Employment and Severance Agreement (the “Agreement”), originally effective as of the
First day of June, 2002, is amended and restated this 5 day of December, 2007, to be effective as
of January 1, 2008, by AGCO CORPORATION, a Delaware corporation (the “Company”), and Andrew H. Beck
(the “Executive”). This Agreement amends, restates and supersedes the Employment and Severance
Agreement between the Company and the Executive effective as of the 1st day of June 2002.
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 commenced on June 1, 2002 and shall continue in effect until
terminated in accordance with Section 5 or any other provision of the Agreement.
| 2. | POSITION AND DUTIES. |
The Executive shall serve as an Executive Officer of the Company and shall perform such duties
and responsibilities as may from time to time be prescribed by the Company’s board of directors
(the “Board”), provided that such duties and responsibilities are consistent with the Executive’s
position. The Executive shall perform and discharge faithfully, diligently and to the best of his
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 Three Hundred and Sixty-Five Thousand Dollars ($365,000), payable in equal semi-monthly
installments throughout the term of such employment subject to Section 5 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 the
Management Incentive Compensation Plan implemented by the Company.
(c) OTHER BENEFITS. During the term of this Agreement, the Executive shall be entitled to
participate in the long term incentive 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 promptly 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, or reimburse the Executive for, all
expenses for fuel, maintenance and insurance in connection with such use of the automobile. In no
event will any such reimbursements or payments under this Subsection 3(d) be made, if at all, later
than the last day of the Executive’s taxable year next following the Executive’s taxable year in
which the Executive incurs the expense. The Company further agrees that Executive shall be
entitled to four (4) weeks of vacation in any year of the term of employment hereunder. Nothing
paid to the Executive under any such Company plans or arrangements shall be deemed to be in lieu of
compensation to the Executive hereunder.
4. NON-DISCLOSURE, NON-COMPETITION AND NON-SOLICITATION COVENANTS.
(a) ACKNOWLEDGEMENTS. The Executive acknowledges that as an Executive Officer 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 terms shall have the following
meanings:
(i) “COMPETITIVE POSITION” shall mean (i) the Executive’s direct or indirect equity
ownership (excluding equity ownership of less than one percent (1%) or control of all or any
portion of a Competitor, or (ii) any employment, consulting, partnership, advisory,
directorship, agency, promotional or independent contractor arrangement between the
Executive and any Competitor whereby the Executive is required to perform executive level
services substantially similar to those that he will perform for the Company as an Executive
Officer.
2
(ii) “COMPETITOR” of the Company shall refer to any person or entity engaged, wholly or
partly, in the business of manufacturing and distributing farm equipment machinery and
replacement parts.
(iii) “CONFIDENTIAL INFORMATION” shall mean the proprietary and confidential data or
information of the Company, other than “Trade Secrets” (as defined below), which is of
tangible or intangible value to the Company and is not public information or is not
generally known or available to the Company’s competitors.
(iv) “TRADE SECRETS” shall mean information of the Company, including, but not limited
to, technical or non-technical data, formulas, patterns, compilations, programs, devices,
methods, techniques, drawings, processes, financial data, financial plans, products plans,
or lists of actual or potential customers or suppliers, which: (a) derives economic value,
actual or potential, from not being generally known to, and not being readily ascertainable
by proper means by, other persons who can obtain economic value from its disclosure or use;
and (b) is the subject of efforts that are reasonable under the circumstances to maintain
its secrecy.
(v) “WORK PRODUCT” shall mean all work product, property, data, documentation,
“know-how”, concepts or plans, inventions, improvements, techniques, processes or
information of any kind, relating to the Company and its business prepared, conceived,
discovered, developed or created by the Executive for the Company or any of the Company’s
customers.
(c) NONDISCLOSURE; OWNERSHIP OF PROPRIETARY PROPERTY.
(i) The Executive hereby covenants and agrees that: (i) with regard to information
constituting a Trade Secret, at all times during the Executive’s employment with the Company
and all times thereafter during which such information continues to constitute a Trade
Secret; and (ii) with regard to any Confidential Information, at all times during the
Executive’s employment with the Company and for three (3) years after the termination of the
Executive’s employment with the Company, the Executive shall regard and treat all
information constituting a Trade Secret or Confidential Information as strictly confidential
and wholly owned by the Company and will not, for any reason in any fashion, either directly
or indirectly, use, sell, lend, lease, distribute, license, give, transfer, assign, show,
disclose, disseminate, reproduce, copy, appropriate or otherwise communicate any such
information to any party for any purpose other than strictly in accordance with the express
terms of this Agreement and other than as may be required by law.
(ii) To the greatest extent possible, any Work Product shall be deemed to be “work made
for hire” (as defined in the Copyright Act, 17 U.S.C.A. ss. 101 et seq., as amended) and
owned exclusively by the Company. The Executive hereby unconditionally and irrevocably
transfers and assigns to the Company all rights, title and interest the Executive may
currently have or in the future may have by operation of law or otherwise in or to any Work
Product, including, without limitation, all patents, copyrights, trademarks, service marks
and other intellectual property rights. The Executive agrees to execute and deliver to the
Company any transfers, assignments, documents or other instruments which the Company may
deem necessary or appropriate
3
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.
(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 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, Western Europe, Brazil and Canada. The Executive and the Company each acknowledge that
the scope of the Restricted Territory is reasonable because (1) the Company is conducting
substantial business in all fifty states (as well as several foreign countries), (2) the Executive
occupies one of the top executive positions with the Company, and (3) the Executive will be
carrying out his employment responsibilities in all locations where the Company is doing business.
(e) NON-SOLICITATION OF CUSTOMERS. The Executive agrees that during the term of his
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 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.
4
(f) NON-SOLICITATION OF COMPANY PERSONNEL. The Executive 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 Executive’s violation of any of
the covenants in this Section 4 would not be an adequate or proper remedy and that should the
Executive violate or threaten to violate any of the provisions of such covenants, the Company or
its successors or assigns shall be entitled to obtain a temporary or permanent injunction against
Executive in any court having jurisdiction prohibiting any further violation of any such covenants,
in addition to any award or damages, compensatory, exemplary or otherwise, for such violation, if
any.
(h) PARTIAL ENFORCEMENT. The Company has attempted to limit the rights of the Executive to
compete only to the extent necessary to protect the Company from unfair competition. The Company,
however, agrees that, if the scope of enforceability of these restrictive covenants is in any way
disputed at any time, a court or other trier of fact may modify and enforce the covenant to the
extent that it believes to be reasonable under the circumstances existing at the time.
| 5. | TERMINATION. |
(a) DEATH. The Executive’s employment hereunder shall terminate upon the death of the
Executive, provided, however, that for purposes of the payment of Base Salary to the Executive
under this Agreement the death of the Executive shall be deemed to have occurred ninety (90) days
from the last day of the month in which the death of the Executive shall have occurred.
(b) INCAPACITY. The Company may terminate the Executive’s employment hereunder at the end of
any calendar month by giving written Notice of Termination to the Executive in the event of the
Executive’s incapacity due to physical or mental illness which prevents the proper performance of
the duties of the Executive set forth herein or established pursuant hereto for a substantial
portion of any six (6) month period of the Executive’s term of employment hereunder. Any question
as to the existence, extent or potentiality of illness or incapacity of Executive upon which
Company and Executive cannot agree shall be determined by a qualified independent physician
selected by the Company and
5
approved by Executive (or, if Executive is unable to give such approval, by any adult member
of the immediate family or the duly appointed guardian of the Executive). The determination of
such physician shall be certified in writing to the Company and to the Executive and shall be final
and conclusive for all purposes of this Agreement.
(c) CAUSE. The Company may terminate the Executive’s employment hereunder for Cause by giving
written Notice of Termination to the Executive. For the purposes of this Agreement, the Company
shall have “Cause” to terminate the Executive’s employment hereunder upon: (i) the Executive’s
habitual drunkenness or chronic substance abuse; (ii) a willful failure by the Executive to
materially perform and discharge the duties and responsibilities of the Executive hereunder; (iii)
any breach by the Executive of the provisions of Section 4 hereof; (iv) any misconduct by the
Executive that is materially injurious to the Company; or (v) a conviction of a felony involving
the personal dishonesty or moral turpitude of the Executive.
(d) WITHOUT CAUSE; GOOD REASON.
(i) The Company may terminate the Executive’s employment hereunder without Cause, by
giving written Notice of termination to the Executive.
(ii) The Executive may terminate his employment hereunder, by giving written Notice of
Termination to the Company. For the purposes of this Agreement, the Executive shall have
“Good Reason” to terminate his employment hereunder upon (and without the written consent of
the Executive) (a) a reduction in the Executive’s base salary or 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
material breach by the Company of this Agreement.
(e) NOTICE OF TERMINATION. Any termination by the Company pursuant to the Subsections (b),
(c) or (d)(i) above or by the Executive pursuant to Subsection (d)(ii) above, shall be communicated
by written Notice of Termination from the party issuing such notice to the other party hereto. 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 the Notice of Termination shall not be dated earlier than ninety (90) days
from the date such Notice is delivered or mailed to the applicable party.
(f) OBLIGATION TO PAY. Except upon voluntary termination by the Executive without Good
Reason, termination by the Company for Cause, or termination as a result of death or incapacity and
subject to Sections 6 and 16 below, the Company shall (i) pay the compensation specified in this
Subsection 5(f) to the Executive for the period specified in this Subsection 5(f), (ii) continue to
provide, no less frequently than monthly, life insurance benefits during the remainder of the
applicable period, including the Severance Period set forth in this Subsection 5(f), and (iii) if
and to the extent the Executive timely elects COBRA continuation coverage, pay the Executive on a
monthly basis the cost of COBRA premiums for a period of 18 months or such lesser period as the
Executive continues to have COBRA
6
continuation coverage. If the Executive’s employment shall be terminated by reason of death,
the estate of the Executive shall be paid all Base Salary and reimbursements 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, on the same basis as if
the Executive had continued employment through such times, 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 Base Salary and reimbursements and payments 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 reimbursements otherwise payable to the
Executive and the Company shall have no further obligations to the Executive under this Agreement.
If the Executive’s employment shall be terminated by the Company, without cause, or by the
Executive for Good Reason, the Executive shall be paid all Base Salary and reimbursements and
payments 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 (x) continue to pay the Executive the Base Salary (at the rate in effect on
the date of such termination) for a period of two (2) year from the date of such termination (such
two (2) year period being referred to hereinafter as the “Severance Period”) on the same basis as
if Executive had continued employment during the Severance Period and (y) pay the Executive a pro
rata portion of the bonus or other incentive benefits to which the Executive would have been
entitled for the year of termination, had the Executive remained employed for the entire year which
incentive compensation shall be payable at the time incentive compensation is payable generally
under the applicable incentive plans; provided, however, that notwithstanding the foregoing, the
Executive shall not be entitled to any severance payments under (x) and (y) upon and after reaching
age 65. The Executive shall have no further right to receive any other compensation benefits or
perquisites after the date of termination of employment except as determined under the terms of
this Agreement or any applicable employee benefit plans or programs of the Company or under
applicable law.
6. CONDITIONS APPLICABLE TO SEVERANCE PERIOD; MITIGATION OF DAMAGES
(a) If during the Severance Period, the Executive breaches his obligations under Section 4
above, the Company may, upon written notice to the Executive, terminate the Severance Period and
cease to make any further payments or provide any benefits described in Subsection 5(f).
(b) Although the Executive shall not be required to mitigate the amount of any payment
provided for in Subsection 5(f) by seeking other employment, any such payments shall be reduced by
any amounts which the Executive receives or is entitled to receive from another employer with
respect to the Severance Period. The Executive shall promptly notify the Company in writing in the
event that other employment is obtained during the Severance Period.
7
7. 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
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
in the case of the Executive to:
Andrew H. Beck
3080 Lanier Drive
Atlanta, Georgia 30319
3080 Lanier Drive
Atlanta, Georgia 30319
or to such other address as either party shall designate by giving written notice of such change to
the other party.
8. 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 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 7 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 8, 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
8
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: __________________ | Company initials: __________________ |
9. 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.
10. 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.
11. 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.
12. SURVIVAL. The provisions of Section 4 hereof shall survive the termination of Executive’s
employment and shall be binding upon the Executive’s personal or legal representative, executors,
administrators, successors, heirs, distributee, devisees and legatees and the provisions of Section
5 hereof relating to payments and termination of the Executive’s employment hereunder shall survive
such termination and shall be binding upon the Company.
13. 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.
14. ENTIRE AGREEMENT. This Agreement constitutes the full agreement and understanding of the
parties hereto with respect to the subject matter hereof and all prior or contemporaneous
agreements or understandings are merged herein. The parties to this Agreement each acknowledge
that both of them and their respective agents and advisors were active in the negotiation and
drafting of the terms of this Agreement.
15. 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.
16. DEFERRED COMPENSATION PLAN OMNIBUS PROVISIONS. Notwithstanding any other provision of this
Agreement, it is intended that any payment or benefit which is provided pursuant to or in
connection with this Agreement which is considered to be deferred compensation subject to Section
409A of the Internal Revenue Code of 1986, as
9
amended (the “Code”) shall be provided and paid in a manner, and at such time, including
without limitation payment and provision of benefits only in connection with a permissible payment
event contained in Section 409A (e.g., death or separation from service from the Company and its
affiliates as defined for purposes of Section 409A of the Code), and in such form, as complies with
the applicable requirements of Section 409A of the Code to avoid the unfavorable tax consequences
provided therein for non-compliance. For purposes of this Agreement, all rights to payments and
benefits hereunder shall be treated as rights to receive a series of separate payments and benefits
to the fullest extent allowed by Section 409A of the Code. If Executive is a “specified employee”
(as defined in Section 409A of the Code) and any of the Company’s stock is publicly traded on an
established securities market or otherwise, then payment of any amount or provision of any benefit
under this Agreement which is considered to be deferred compensation subject to Section 409A of the
Code shall be deferred for six (6) months as required by Section 409A(a)(2)(B)(i) of the Code (the
“409A Deferral Period”). In the event such payments are otherwise due to be made in installments
or periodically during the 409A Deferral Period, the payments which would otherwise have been made
in the 409A Deferral Period shall be accumulated and paid in a lump sum as soon as the 409A
Deferral Period ends, and the balance of the payments shall be made as otherwise scheduled. In the
event benefits are required to be deferred, any such benefit may be provided during the 409A
Deferral Period at Executive’s expense, with Executive having a right to reimbursement from the
Company once the 409A Deferral Period ends, and the balance of the benefits shall be provided as
otherwise scheduled. For purposes of this Agreement, any termination of employment will be read to
mean a “separation from service” within the meaning of Section 409A of the Code where it is
reasonably anticipated that no further services would be performed after such date or that the
level of bona fide services Executive would perform after that date (whether as an employee or
independent contractor) would permanently decrease to less than fifty percent (50%) of the average
level of bona fide services performed over the immediately preceding thirty-six (36)-month period.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
| AGCO CORPORATION |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| EXECUTIVE | ||||
10
Exhibit 10.4
EMPLOYMENT AND SEVERANCE AGREEMENT
AS AMENDED AND RESTATED
AS AMENDED AND RESTATED
This Employment and Severance Agreement (the “Agreement”), originally effective as of the 1st
day of September 1999, is amended and restated this 5 day of December, 2007, to be effective as of
January 1, 2008, by AGCO CORPORATION, a Delaware corporation (the “Company”), and Norm L. Boyd (the
“Executive”). This Agreement amends, restates and supersedes the Employment and Severance
Agreement between the Company and the Executive effective as of the 1st day of September 1999.
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 commenced on September 1, 1999 and shall continue in effect until
terminated in accordance with Section 5 or any other provision of the Agreement.
2. POSITION AND DUTIES.
The Executive shall serve as an Executive Officer of the Company and shall perform such duties
and responsibilities as may from time to time be prescribed by the Company’s board of directors
(the “Board”), provided that such duties and responsibilities are consistent with the Executive’s
position. The Executive shall perform and discharge faithfully, diligently and to the best of his
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 Three Hundred and Ten Thousand Dollars ($310,000), payable in equal semi-monthly installments
throughout the term of such employment subject to Section 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 the
Management Incentive Compensation Plan implemented by the Company.
(c) OTHER BENEFITS. During the term of this Agreement, the Executive shall be entitled to
participate in the long term incentive 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 promptly for all reasonable
and necessary expenses incurred by him/her 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, or reimburse the Executive for, all
expenses for fuel, maintenance and insurance in connection with such use of the automobile. In no
event will any such reimbursements or payments under this Subsection 3(d) be made, if at all, later
than the last day of the Executive’s taxable year next following the Executive’s taxable year in
which the Executive incurs the expense. The Company further agrees that Executive shall be
entitled to four (4) weeks of vacation in any year of the term of employment hereunder. Nothing
paid to the Executive under any such Company plans or arrangements shall be deemed to be in lieu of
compensation to the Executive hereunder.
4. NON-DISCLOSURE, NON-COMPETITION AND NON-SOLICITATION COVENANTS.
(a) ACKNOWLEDGEMENTS. The Executive acknowledges that as an Executive Officer 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/her to abide by the covenants set forth in this Section
4. The parties acknowledge and agree that if the nature of the Executive’s responsibilities for or
on behalf of the Company and the geographical areas in which the Executive must fulfill them
materially change, the parties will execute appropriate amendments to the scope of the covenants in
this Section 4.
(b) DEFINITIONS. For purposes of this Section 4, the following terms shall have the following
meanings:
(i) “COMPETITIVE POSITION” shall mean (i) the Executive’s direct or indirect equity ownership
(excluding equity ownership of less than one percent (1%) or control of all or any portion of a
Competitor, or (ii) any employment, consulting, partnership,
2
advisory, directorship, agency, promotional or independent contractor arrangement between the
Executive and any Competitor whereby the Executive is required to perform executive level services
substantially similar to those that he will perform for the Company as an Executive Officer.
(ii) “COMPETITOR” of the Company shall refer to any person or entity engaged, wholly or
partly, in the business of manufacturing and distributing farm equipment machinery and replacement
parts.
(iii) “CONFIDENTIAL INFORMATION” shall mean the proprietary and confidential data or
information of the Company, other than “Trade Secrets” (as defined below), which is of tangible or
intangible value to the Company and is not public information or is not generally known or
available to the Company’s competitors.
(iv) “TRADE SECRETS” shall mean information of the Company, including, but not limited to,
technical or non-technical data, formulas, patterns, compilations, programs, devices, methods,
techniques, drawings, processes, financial data, financial plans, products plans, or lists of
actual or potential customers or suppliers, which: (a) derives economic value, actual or potential,
from not being generally known to, and not being readily ascertainable by proper means by, other
persons who can obtain economic value from its disclosure or use; and (b) is the subject of efforts
that are reasonable under the circumstances to maintain its secrecy.
(v) “WORK PRODUCT” shall mean all work product, property, data, documentation, “know-how”,
concepts or plans, inventions, improvements, techniques, processes or information of any kind,
relating to the Company and its business prepared, conceived, discovered, developed or created by
the Executive for the Company or any of the Company’s customers.
(c) NONDISCLOSURE; OWNERSHIP OF PROPRIETARY PROPERTY.
(i) The Executive hereby covenants and agrees that: (i) with regard to information
constituting a Trade Secret, at all times during the Executive’s employment with the Company and
all times thereafter during which such information continues to constitute a Trade Secret; and (ii)
with regard to any Confidential Information, at all times during the Executive’s employment with
the Company and for three (3) years after the termination of the Executive’s employment with the
Company, the Executive shall regard and treat all information constituting a Trade Secret or
Confidential Information as strictly confidential and wholly owned by the Company and will not, for
any reason in any fashion, either directly or indirectly, use, sell, lend, lease, distribute,
license, give, transfer, assign, show, disclose, disseminate, reproduce, copy, appropriate or
otherwise communicate any such information to any party for any purpose other than strictly in
accordance with the express terms of this Agreement and other than as may be required by law.
(ii) To the greatest extent possible, any Work Product shall be deemed to be “work made for
hire” (as defined in the Copyright Act, 17 U.S.C.A. ss. 101 et seq., as amended) and owned
exclusively by the Company. The Executive hereby unconditionally and
3
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.
(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 theft expiration under the terms of this Agreement.
(d) NON-COMPETITION. The Executive agrees that during 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, Western Europe, Brazil and Canada. The Executive and the Company each acknowledge that the
scope of the Restricted Territory is reasonable because (1) the Company is conducting substantial
business in all fifty states (as well as several foreign countries), (2) the Executive occupies one
of the top executive positions with the Company, and (3) the Executive will be carrying out his
employment responsibilities in all locations where the Company is doing business.
(e) NON-SOLICITATION OF CUSTOMERS. The Executive agrees that during the term of his
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 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
4
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 be 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 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 Executive’s violation of any of
the covenants in this Section 4 would not be an adequate or proper remedy and that should the
Executive violate or threaten to violate any of the provisions of such covenants, the Company or
its successors or assigns shall be entitled to obtain a temporary or permanent injunction against
Executive in any court having jurisdiction prohibiting any further violation of any such covenants,
in addition to any award or damages, compensatory, exemplary or otherwise, for such violation, if
any.
(h) PARTIAL ENFORCEMENT. The Company has attempted to limit the rights of the Executive to
compete only to the extent necessary to protect the Company from unfair competition, The Company,
however, agrees that, if the scope of enforceability of these restrictive covenants is in any way
disputed at any time, a court or other trier of fact may modify and enforce the covenant to the
extent that it believes to be reasonable under the circumstances existing at the time.
5. TERMINATION.
(a) DEATH. The Executive’s employment hereunder shall terminate upon the death of the
Executive, provided, however, that for purposes of the payment of Base Salary 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.
5
(b) INCAPACITY. The Company may terminate the Executive’s employment hereunder at the end of
any calendar month by giving written Notice of Termination to the Executive in the event of the
Executive’s incapacity due to physical or mental illness which prevents the proper performance of
the duties of the Executive set forth herein or established pursuant hereto for a substantial
portion of any six (6) month period of the Executive’s term of employment hereunder. Any question
as to the existence, extent or potentiality of illness or incapacity of Executive upon which
Company and Executive cannot agree shall be determined by a qualified independent physician
selected by the Company and approved by Executive (or, if Executive is unable to give such
approval, by any adult member of the immediate family or the duly appointed guardian of the
Executive). The determination of such physician shall be certified in writing to the Company and to
the Executive and shall be final and conclusive for all purposes of this Agreement.
(c) CAUSE. The Company may terminate the Executive’s employment hereunder for Cause by giving
written Notice of Termination to the Executive. For the purposes of this Agreement, the Company
shall have “Cause” to terminate the Executive’s employment hereunder upon: (i) the Executive’s
habitual drunkenness or chronic substance abuse; (ii) a willful failure by the Executive to
materially perform mid discharge the duties and responsibilities of the Executive hereunder; (iii)
any breach by the Executive of the provisions of Section 4 hereof; (iv) any misconduct by the
Executive that is materially injurious to the Company; or (v) a conviction of a felony involving
the personal dishonesty or moral turpitude of the Executive.
(d) WITHOUT CAUSE; GOOD REASON.
(i) The Company may terminate the Executive’s employment hereunder without Cause, by giving
written Notice of termination to the Executive.
(ii) The Executive may terminate his employment hereunder, by giving written Notice of
Termination to the Company. For the purposes of this Agreement, the Executive shall have “Good
Reason” to terminate his employment hereunder upon (and without the written consent of the
Executive) (a) a reduction in the Executive’s base salary or benefits received from the Company,
other than in connection with all 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 material breach by the Company of
this Agreement.
(e) NOTICE OF TERMINATION. Any termination by the Company pursuant to the Subsections (b),
(c) or (d)(i) above or by the Executive pursuant to Subsection (d)(ii) above, shall be communicated
by written Notice of Termination from the party issuing such notice to the other party hereto. 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 the Notice of Termination shall not be dated earlier than ninety (90) days
from the date such Notice is delivered or mailed to the applicable party.
6
(f) OBLIGATION TO PAY. Except upon voluntary termination by the Executive without Good
Reason, termination by the Company for Cause, or termination as a result of death or incapacity and
subject to Sections 6 and 16 below, the Company shall (i) pay the compensation specified in this
Subsection 5(f) to the Executive for the period specified in this Subsection 5(f), (ii) continue to
provide, no less frequently than monthly, life insurance benefits during the remainder of the
applicable period, including the Severance Period set forth in this Subsection 5(f), and (iii) if
and to the extent the Executive timely elects COBRA continuation coverage, pay the Executive on a
monthly basis the cost of COBRA premiums for a period of 18 months or such lesser period as the
Executive continues to have COBRA continuation coverage. If the Executive’s employment shall be
terminated by reason of death, the estate of the Executive shall be paid all Base Salary and
reimbursements 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, on the same basis as if the Executive had continued employment through such
times, 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 Base Salary and
reimbursements and payments 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 reimbursements otherwise payable to the Executive and the Company shall have no
further obligations to the Executive under this Agreement. If the Executive’s employment shall be
terminated by the Company, without cause, or by the Executive for Good Reason, the Executive shall
be paid all Base Salary and reimbursements and payments 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 (x) continue to pay the
Executive the Base Salary (at the rate in effect on the date of such termination) for a period of
two (2) years from the date of such termination (such two (2) year period being referred to
hereinafter as the “Severance Period”) on the same basis as if Executive had continued employment
during the Severance Period and (y) pay the Executive a pro rata portion of the bonus or other
incentive benefits to which the Executive would have been entitled for the year of termination, had
the Executive remained employed for the entire year which incentive compensation shall be payable
at the time incentive compensation is payable generally under the applicable incentive plans. The
Executive shall have no further right to receive any other compensation benefits or perquisites
after the date of termination of employment except as determined under the terms of this Agreement
or any applicable employee benefit plans or programs of the Company or under applicable law.
6. CONDITIONS APPLICABLE TO SEVERANCE PERIOD; MITIGATION OF DAMAGES.
(a) If during the Severance Period, the Executive breaches his obligations under Section 4
above, the Company may, upon written notice to the Executive, terminate the
7
Severance Period and cease to make any further payments or provide any benefits described in
Subsection 5(f).
(b) Although the Executive shall not be required to mitigate the amount of any payment
provided for in Subsection 5(f) by seeking other employment, any such payments shall be reduced by
any amounts which the Executive receives or is entitled to receive from another employer with
respect to the Severance Period. The Executive shall promptly notify the Company in writing in the
event that other employment is obtained during the Severance Period.
7. 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
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
in the case of the Executive to:
Norm L. Boyd
9145 Old Southwick Pass
Alpharetta, Georgia 30022
9145 Old Southwick Pass
Alpharetta, Georgia 30022
or to such other address as either party shall designate by giving written notice of such change to
the other party.
8. 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 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 7 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
8
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 8,
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 patties. 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: _______________ | Company initials: _______________ |
9. 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.
10. 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.
11. 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.
12. SURVIVAL. The provisions of Section 4 hereof shall survive the termination of Executive’s
employment and shall be binding upon the Executive’s personal or legal representative, executors,
administrators, successors, heirs, distributee, devisees and legatees and the provisions of Section
5 hereof relating to payments and termination of the Executive’s employment hereunder shall survive
such termination and shall be binding upon the Company.
9
13. 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.
14. ENTIRE AGREEMENT. This Agreement constitutes the full agreement and understanding of the
parties hereto with respect to the subject matter hereof and all prior or contemporaneous
agreements or understandings are merged herein. The parties to this Agreement each acknowledge
that both of them and their respective agents and advisors were active in the negotiation and
drafting of the terms of this Agreement.
15. 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.
16. DEFERRED COMPENSATION PLAN OMNIBUS PROVISIONS. Notwithstanding any other provision of this
Agreement, it is intended that any payment or benefit which is provided pursuant to or in
connection with this Agreement which is considered to be deferred compensation subject to Section
409A of the Internal Revenue Code of 1986, as amended (the “Code”) shall be provided and paid in a
manner, and at such time, including without limitation payment and provision of benefits only in
connection with a permissible payment event contained in Section 409A (e.g., death or separation
from service from the Company and its affiliates as defined for purposes of Section 409A of the
Code), and in such form, as complies with the applicable requirements of Section 409A of the Code
to avoid the unfavorable tax consequences provided therein for non-compliance. For purposes of
this Agreement, all rights to payments and benefits hereunder shall be treated as rights to receive
a series of separate payments and benefits to the fullest extent allowed by Section 409A of the
Code. If Executive is a “specified employee” (as defined in Section 409A of the Code) and any of
the Company’s stock is publicly traded on an established securities market or otherwise, then
payment of any amount or provision of any benefit under this Agreement which is considered to be
deferred compensation subject to Section 409A of the Code shall be deferred for six (6) months as
required by Section 409A(a)(2)(B)(i) of the Code (the “409A Deferral Period”). In the event such
payments are otherwise due to be made in installments or periodically during the 409A Deferral
Period, the payments which would otherwise have been made in the 409A Deferral Period shall be
accumulated and paid in a lump sum as soon as the 409A Deferral Period ends, and the balance of the
payments shall be made as otherwise scheduled. In the event benefits are required to be deferred,
any such benefit may be provided during the 409A Deferral Period at Executive’s expense, with
Executive having a right to reimbursement from the Company once the 409A Deferral Period ends, and
the balance of the benefits shall be provided as otherwise scheduled. For purposes of this
Agreement, any termination of employment will be read to mean a “separation from service” within
the meaning of Section 409A of the Code where it is reasonably anticipated that no further services
would be performed after such date or that the level of bona fide services Executive would perform
after that date (whether as an employee or independent contractor) would permanently decrease to
less than fifty percent (50%) of the average level of bona fide services performed over the
immediately preceding thirty-six (36)-month period.
10
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
| AGCO CORPORATION |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| EXECUTIVE |
||||
11
Exhibit 10.5
EMPLOYMENT AND SEVERANCE AGREEMENT
AS AMENDED AND RESTATED
AS AMENDED AND RESTATED
This Employment and Severance Agreement (the “Agreement”), originally effective as of the 20th
day of October 2003, is amended and restated this 5 day of December, 2007, to be effective as of
January 1, 2008, by AGCO CORPORATION, a Delaware corporation (the “Company”), and David L. Caplan
(the “Executive”). This Agreement amends, restates and supersedes the Employment and Severance
Agreement between the Company and the Executive effective as of the 20th day of October
2003.
WITNESSETH:
In consideration of the mutual covenants and agreements hereinafter set forth, the Company and
the Executive do hereby agree as follows:
I. 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 commenced on October 20, 2003 and shall continue in effect until
terminated in accordance with Section 5 or any other provision of the Agreement.
2. POSITION AND DUTIES.
The Executive shall serve as an Executive Officer of the Company and shall perform such duties
and responsibilities as may from time to time be prescribed by the Company’s board of directors
(the “Board”), provided that such duties and responsibilities are consistent with the Executive’s
position. The Executive shall perform and discharge faithfully, diligently and to the best of his
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 Two Hundred and Eighty Thousand Dollars ($280,000.00), payable in equal semi-monthly
installments throughout the term of such employment subject to Section 5 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 the
Management Incentive Compensation Plan implemented by the Company.
(c) OTHER BENEFITS. During the term of this Agreement, the Executive shall be entitled to
participate in the long term incentive 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 promptly for all reasonable
and necessary expenses incurred by him/her 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, or reimburse the Executive for, all
expenses for fuel, maintenance and insurance in connection with such use of the automobile. In no
event will any such reimbursements or payments under this Subsection 3(d) be made, if at all, later
than the last day of the Executive’s taxable year next following the Executive’s taxable year in
which the Executive incurs the expense. The Company further agrees that Executive shall be
entitled to four (4) weeks of vacation in any year of the term of employment hereunder. Nothing
paid to the Executive under any such Company plans or arrangements shall be deemed to be in lieu of
compensation to the Executive hereunder.
4. NON-DISCLOSURE, NON-COMPETITION AND NON-SOLICITATION COVENANTS.
(a) ACKNOWLEDGEMENTS. The Executive acknowledges that as an Executive Officer 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/her to abide by the covenants set forth in this Section
4. The parties acknowledge and agree that if the nature of the Executive’s responsibilities for or
on behalf of the Company and the geographical areas in which the Executive must fulfill them
materially change, the parties will execute appropriate amendments to the scope of the covenants in
this Section 4.
(b) DEFINITIONS. For purposes of this Section 4, the following terms shall have the following
meanings:
(i) “COMPETITIVE POSITION” shall mean (i) the Executive’s direct or indirect equity ownership
(excluding equity ownership of less than one percent (1%) or control of all or any portion of a
Competitor, or (ii) any employment, consulting, partnership, advisory, directorship, agency,
promotional or independent contractor arrangement between the Executive and any Competitor whereby
the Executive is required to perform executive level services substantially similar to those that
he will perform for the Company as an Executive Officer.
(ii) “COMPETITOR” of the Company shall refer to any person or entity engaged, wholly or
partly, in the business of manufacturing and distributing farm equipment machinery and replacement
parts.
2
(iii) “CONFIDENTIAL INFORMATION” shall mean the proprietary and confidential data or
information of the Company, other than “Trade Secrets” (as defined below), which is of tangible or
intangible value to the Company and is not public information or is not generally known or
available to the Company’s competitors.
(iv) “TRADE SECRETS” shall mean information of the Company, including, but not limited to,
technical or non-technical data, formulas, patterns, compilations, programs, devices, methods,
techniques, drawings, processes, financial data, financial plans, products plans, or lists of
actual or potential customers or suppliers, which: (a) derives economic value, actual or potential,
from not being generally known to, and not being readily ascertainable by proper means by, other
persons who can obtain economic value from its disclosure or use; and (b) is the subject of efforts
that are reasonable under the circumstances to maintain its secrecy.
(v) “WORK PRODUCT” shall mean all work product, property, data, documentation, “know-how”,
concepts or plans, inventions, improvements, techniques, processes or information of any kind,
relating to the Company and its business prepared, conceived, discovered, developed or created by
the Executive for the Company or any of the Company’s customers.
(c) NONDISCLOSURE; OWNERSHIP OF PROPRIETARY PROPERTY.
(i) The Executive hereby covenants and agrees that: (i) with regard to information
constituting a Trade Secret, at all times during the Executive’s employment with the Company and
all times thereafter during which such information continues to constitute a Trade Secret; and (ii)
with regard to any Confidential Information, at all times during the Executive’s employment with
the Company and for three (3) years after the termination of the Executive’s employment with the
Company, the Executive shall regard and treat all information constituting a Trade Secret or
Confidential Information as strictly confidential and wholly owned by the Company and will not, for
any reason in any fashion, either directly or indirectly, use, sell, lend, lease, distribute,
license, give, transfer, assign, show, disclose, disseminate, reproduce, copy, appropriate or
otherwise communicate any such information to any party for any purpose other than strictly in
accordance with the express terms of this Agreement and other than as may be required by law.
(ii) To the greatest extent possible, any Work Product shall be deemed to be “work made for
hire” (as defined in the Copyright Act, 17 U.S.C.A. ss. 101 et seq., as amended) and owned
exclusively by the Company. The Executive hereby unconditionally and irrevocably transfers and
assigns to the Company all rights, title and interest the Executive may currently have or in the
future may have by operation of law or otherwise in or to any Work Product, including, without
limitation, all patents, copyrights, trademarks, service marks and other intellectual property
rights. The Executive agrees to execute and deliver to the Company any transfers, assignments,
documents or other instruments which the Company may deem necessary or appropriate to vest complete
title and ownership of any Work Product, and all rights therein, exclusively in the Company.
(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
3
exercise his best efforts to assist the Company, to the extent the Company deems reasonably
necessary, in the procurement of any protection of the Company’s rights to or in any of the Trade
Secrets or Confidential Information.
(iv) Immediately upon termination of the Executive’s employment with the Company, or at any
point prior to or after that time upon the specific request of the Company, the Executive shall
return to the Company all written or descriptive materials of any kind in the Executive’s
possession or to which the Executive has access that constitute or contain any Confidential
Information or Trade Secrets, and the confidentiality obligations of this Agreement shall continue
until theft expiration under the terms of this Agreement.
(d) NON-COMPETITION. The Executive agrees that during 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, Western Europe, Brazil and Canada. The Executive and the Company each acknowledge that the
scope of the Restricted Territory is reasonable because (1) the Company is conducting substantial
business in all fifty states (as well as several foreign countries), (2) the Executive occupies one
of the top executive positions with the Company, and (3) the Executive will be carrying out his
employment responsibilities in all locations where the Company is doing business.
(e) NON-SOLICITATION OF CUSTOMERS. The Executive agrees that during the term of his
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 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 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
4
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 Executive’s violation of any of the
covenants in this Section 4 would not be an adequate or proper remedy and that should the Executive
violate or threaten to violate any of the provisions of such covenants, the Company or its
successors or assigns shall be entitled to obtain a temporary or permanent injunction against
Executive in any court having jurisdiction prohibiting any further violation of any such covenants,
in addition to any award or damages, compensatory, exemplary or otherwise, for such violation, if
any.
(h) PARTIAL ENFORCEMENT. The Company has attempted to limit the rights of the Executive to
compete only to the extent necessary to protect the Company from unfair competition. The Company,
however, agrees that, if the scope of enforceability of these restrictive covenants is in any way
disputed at any time, a court or other trier of fact may modify and enforce the covenant to the
extent that it believes to be reasonable under the circumstances existing at the time.
5. TERMINATION.
(a) DEATH. The Executive’s employment hereunder shall terminate upon the death of the
Executive, provided, however, that for purposes of the payment of Base Salary to the Executive
under this Agreement the death of the Executive shall be deemed to have occurred ninety (90) days
from the last day of the month in which the death of the Executive shall have occurred.
(b) INCAPACITY. The Company may terminate the Executive’s employment hereunder at the end of
any calendar month by giving written Notice of Termination to the Executive in the event of the
Executive’s incapacity due to physical or mental illness which prevents the proper performance of
the duties of the Executive set forth herein or established pursuant hereto for a substantial
portion of any six (6) month period of the Executive’s term of employment hereunder. Any question
as to the existence, extent or potentiality of illness or incapacity of Executive upon which
Company and Executive cannot agree shall be determined by a qualified independent physician
selected by the Company and approved by Executive (or, if Executive is unable to give such
approval, by any adult member of the immediate family or the duly appointed guardian of the
Executive). The determination of such physician shall be certified in writing to the Company and to
the Executive and shall be final and conclusive for all purposes of this Agreement.
(c) CAUSE. The Company may terminate the Executive’s employment hereunder for Cause by giving
written Notice of Termination to the Executive. For the purposes of this Agreement, the Company
shall have “Cause” to terminate the Executive’s employment hereunder upon: (i) the Executive’s
habitual drunkenness or chronic substance abuse; (ii) a willful failure by the Executive to
materially perform and discharge the duties and
5
responsibilities of the Executive hereunder; (iii) any breach by the Executive of the
provisions of Section 4 hereof; (iv) any misconduct by the Executive that is materially injurious
to the Company; or (v) a conviction of a felony involving the personal dishonesty or moral
turpitude of the Executive.
(d) WITHOUT CAUSE; GOOD REASON.
(i) The Company may terminate the Executive’s employment hereunder without Cause, by giving
written Notice of termination to the Executive.
(ii) The Executive may terminate his employment hereunder, by giving written Notice of
Termination to the Company. For the purposes of this Agreement the Executive shall have “Good
Reason” to terminate his employment hereunder upon (and without the written consent of the
Executive) (a) a reduction in the Executive’s base salary or 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 material breach by the Company of
this Agreement.
(e) NOTICE OF TERMINATION. Any termination by the Company pursuant to the Subsections (b), (c)
or (d)(i) above or by the Executive pursuant to Subsection (d)(ii) above, shall be communicated by
written Notice of Termination from the party issuing such notice to the other party hereto. 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 the Notice of Termination shall not be dated earlier than ninety (90) days
from the date such Notice is delivered or mailed to the applicable party.
(f) OBLIGATION TO PAY. Except upon voluntary termination by the Executive without Good Reason,
termination by the Company for Cause, or termination as a result of death or incapacity and subject
to Sections 6 and 16 below, the Company shall (i) pay the compensation specified in this Subsection
5(f) to the Executive for the period specified in this Subsection 5(f), (ii) continue to provide,
no less frequently than monthly, life insurance benefits during the remainder of the applicable
period, including the Severance Period set forth in this Subsection 5(f), and (iii) if and to the
extent the Executive timely elects COBRA continuation coverage, pay the Executive on a monthly
basis the cost of COBRA premiums for a period of 18 months or such lesser period as the Executive
continues to have COBRA continuation coverage. If the Executive’s employment shall be terminated
by reason of death, the estate of the Executive shall be paid all Base Salary and reimbursements
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, on the
same basis as if the Executive had continued employment through such times, 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 Base Salary and reimbursements and
payments otherwise payable to the Executive, including the bonus and other benefits accrued or
accruable
6
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 reimbursements
otherwise payable to the Executive and the Company shall have no further obligations to the
Executive under this Agreement. If the Executive’s employment shall be terminated by the Company,
without cause, or by the Executive for Good Reason, the Executive shall be paid all Base Salary and
reimbursements and payments 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 (x) continue to pay the Executive the Base Salary (at
the rate in effect on the date of such termination) for a period of one (1) year from the date of
such termination (such one (1) year period being referred to hereinafter as the “Severance Period”)
on the same basis as if Executive had continued employment during the Severance Period and (y) pay
the Executive a pro rata portion of the bonus or other incentive benefits to which the Executive
would have been entitled for the year of termination, had the Executive remained employed for the
entire year which incentive compensation shall be payable at the time incentive compensation is
payable generally under the applicable incentive plans; provided, however, that notwithstanding the
foregoing, the Executive shall not be entitled to any severance payments under (x) and (y) upon and
after reaching age 65. The Executive shall have no further right to receive any other compensation
benefits or perquisites after the date of termination of employment except as determined under the
terms of this Agreement or any applicable employee benefit plans or programs of the Company or
under applicable law.
6. CONDITIONS APPLICABLE TO SEVERANCE PERIOD; MITIGATION OF DAMAGES
(a) If during the Severance Period, the Executive breaches his obligations under Section 4
above, the Company may, upon written notice to the Executive, terminate the Severance Period and
cease to make any further payments or provide any benefits described in Subsection 5(f).
(b) Although the Executive shall not be required to mitigate the amount of any payment
provided for in Subsection 5(f) by seeking other employment, any such payments shall be reduced by
any amounts which the Executive receives or is entitled to receive from another employer with
respect to the Severance Period. The Executive shall promptly notify the Company in writing in the
event that other employment is obtained during the Severance Period.
7. 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
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
7
in the case of the Executive to:
David L. Caplan
243 Southern Hill Drive
Duluth, Georgia 30097
243 Southern Hill Drive
Duluth, Georgia 30097
or to such other address as either party shall designate by giving written notice of such change to
the other party.
8. 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 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 7 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 8, 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: ______________ | Company initials: ______________ |
9. 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
8
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.
10. 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.
11. 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.
12. SURVIVAL The provisions of Section 4 hereof shall survive the termination of Executive’s
employment and shall be binding upon the Executive’s personal or legal representative, executors,
administrators, successors, heirs, distributee, devisees and legatees and the provisions of Section
5 hereof relating to payments and termination of the Executive’s employment hereunder shall survive
such termination and shall be binding upon the Company.
13. 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.
14. ENTIRE AGREEMENT. This Agreement constitutes the full agreement and understanding of the
parties hereto with respect to the subject matter hereof and all prior or contemporaneous
agreements or understandings are merged herein. The parties to this Agreement each acknowledge that
both of them and their respective agents and advisors were active in the negotiation and drafting
of the terms of this Agreement.
15. 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.
16. DEFERRED COMPENSATION PLAN OMNIBUS PROVISIONS. Notwithstanding any other provision of this
Agreement, it is intended that any payment or benefit which is provided pursuant to or in
connection with this Agreement which is considered to be deferred compensation subject to Section
409A of the Internal Revenue Code of 1986, as amended (the “Code”) shall be provided and paid in a
manner, and at such time, including without limitation payment and provision of benefits only in
connection with a permissible payment event contained in Section 409A (e.g., death or separation
from service from the Company and its affiliates as defined for purposes of Section 409A of the
Code), and in such form, as complies with the applicable requirements of Section 409A of the Code
to avoid the unfavorable tax consequences provided therein for non compliance. For purposes of
this Agreement, all rights to payments and benefits hereunder shall be treated as rights to receive
a series of separate payments and benefits to the fullest extent allowed by Section 409A of the
Code. If Executive is a “specified employee” (as defined in Section 409A of the Code) and any
9
of the Company’s stock is publicly traded on an established securities market or otherwise,
then payment of any amount or provision of any benefit under this Agreement which is considered to
be deferred compensation subject to Section 409A of the Code shall be deferred for six (6) months
as required by Section 409A(a)(2)(B)(i) of the Code (the “409A Deferral Period”). In the event
such payments are otherwise due to be made in installments or periodically during the 409A Deferral
Period, the payments which would otherwise have been made in the 409A Deferral Period shall be
accumulated and paid in a lump sum as soon as the 409A Deferral Period ends, and the balance of the
payments shall be made as otherwise scheduled. In the event benefits are required to be deferred,
any such benefit may be provided during the 409A Deferral Period at Executive’s expense, with
Executive having a right to reimbursement from the Company once the 409A Deferral Period ends, and
the balance of the benefits shall be provided as otherwise scheduled. For purposes of this
Agreement, any termination of employment will be read to mean a “separation from service” within
the meaning of Section 409A of the Code where it is reasonably anticipated that no further services
would be performed after such date or that the level of bona fide services Executive would perform
after that date (whether as an employee or independent contractor) would permanently decrease to
less than fifty percent (50%) of the average level of bona fide services performed over the
immediately preceding thirty-six (36)-month period.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
| AGCO CORPORATION |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| EXECUTIVE |
||||
10
Exhibit 10.6
EMPLOYMENT AND SEVERANCE AGREEMENT
AS AMENDED AND RESTATED
AS AMENDED AND RESTATED
This Employment and Severance Agreement (the “Agreement”), originally effective as of the
First day of May, 2002, is amended and restated this 5 day of December, 2007, to be effective as
of January 1, 2008, by AGCO CORPORATION, a Delaware corporation (the “Company”), and Gary L. Collar
(the “Executive”). This Agreement amends, restates and supersedes the Employment and Severance
Agreement between the Company and the Executive effective as of the 1st day of May 2002.
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 commenced on May 1, 2002, and shall continue in effect until
terminated in accordance with Section 5 or any other provision of the Agreement.
2. POSITION AND DUTIES.
The Executive shall serve as an Executive Officer of the Company and shall perform such duties
and responsibilities as may from time to time be prescribed by the Company’s board of directors
(the “Board”), provided that such duties and responsibilities are consistent with the Executive’s
position. The Executive shall perform and discharge faithfully, diligently and to the best of his
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 Two Hundred and Eighty Thousand Dollars ($280,000.00), payable in equal semi-monthly
installments throughout the term of such employment subject to Section 5 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 the
Management Incentive Compensation Plan implemented by the Company.
(c) OTHER BENEFITS. During the term of this Agreement, Executive shall be entitled to
participate in the long term incentive 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 promptly 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, or reimburse the Executive for, all
expenses for fuel, maintenance and insurance in connection with such use of the automobile. In no
event will any such reimbursements or payments under this Subsection 3(d) be made, if at all, later
than the last day of the Executive’s taxable year next following the Executive’s taxable year in
which the Executive incurs the expense. The Company further agrees that Executive shall be
entitled to four (4) weeks of vacation in any year of the term of employment hereunder. Nothing
paid to the Executive under any such company plans or arrangements shall be deemed to be in lieu of
compensation to the Executive hereunder.
4. NON-DISCLOSURE, NON-COMPETITION AND NON-SOLICITATION COVENANTS.
(a) ACKNOWLEDGMENTS. The Executive acknowledges that as an Executive Officer 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 terms shall have the following
meanings:
(i) “COMPETITIVE POSITION” shall mean (i) the Executive’s direct or indirect equity
ownership (excluding equity ownership of less than one percent (1%) or control of all or any
portion of a Competitor, or (ii) any employment, consulting, partnership, advisory,
directorship, agency, promotional or independent contractor arrangement between the
Executive and any Competitor whereby the Executive is required to perform executive level
services substantially similar to those that he will perform for the Company as an Executive
Manager.
(ii) “COMPETITOR” of the company shall refer to any person or entity engaged, wholly or
partly, in the business of manufacturing and distributing farm equipment machinery and
replacement parts.
2
(iii) “CONFIDENTIAL INFORMATION” shall mean the proprietary and confidential data or
information of the Company, other than ‘Trade Secrets” (as defined below), which is of
tangible or intangible value to the Company and is not public information or is not
generally known or available to the Company’s competitors.
(iv) “TRADE SECRETS” shall mean information of the Company, including, but not limited
to, technical or non-technical data, formulas, patterns, compilations, programs, devices,
methods, techniques, drawings, processes, financial data, financial plans, products plans,
or lists of actual or potential customers or suppliers, which: (a) derives economic value,
actual or potential, from not being generally known to, and not being readily ascertainable
by proper means by, other persons who can obtain economic value from its disclosure or use;
and (b) is the subject of efforts that are reasonable under the circumstances to maintain
its secrecy.
(v) “WORK PRODUCT” shall mean all work product, property, data documentation,
“know-how,” concepts or plans, inventions, improvements, techniques, processes or
information of any kind, relating to the Company and its business prepared, conceived,
discovered, developed or created by the Executive for the Company or any of the Company’s
customers.
(c) NONDISCLOSURE; OWNERSHIP OF PROPRIETARY PROPERTY.
(i) The Executive hereby covenants and agrees that: (i) with regard to information
constituting a Trade Secret, at all times during the Executive’s employment with the Company
and all times thereafter during which such information continues to constitute a Trade
Secret; and (ii) with regard to any Confidential Information, at all times during the
Executive’s employment with the Company and for three (3) years after the termination of the
Executive’s employment with the Company, the executive shall regard and treat all
information constituting a Trade Secret or confidential Information as strictly confidential
and wholly owned by the Company and will not, for any reason in any fashion, either directly
or indirectly, use, sell, lend, lease, distribute, license, give, transfer, assign, show,
disclose, disseminate, reproduce, copy, appropriate or otherwise communicate any such
information to any party for any purpose other than strictly in accordance with the express
terms of this Agreement and other than as may be required by law.
(ii) To the greatest extent possible, any Work product shall be deemed to be “work made
for hire” (as defined in the Copyright Act, 17 U.S.C.A. ss. 101 et seq., as amended) and
owned exclusively by the Company. The Executive hereby unconditionally and irrevocably
transfers and assigns to the Company all rights, title and interest the Executive may
currently have or in the future may have by operation of law or otherwise in or to any Work
Product, including, without limitation, all patents, copyrights, trademarks, service marks
and other intellectual property rights. The Executive agrees to execute and deliver to the
Company any transfers, assignments, documents or other instruments which the Company may
deem necessary or appropriate to vest complete title and ownership of any Work Product, and
all rights therein, exclusively in the Company.
(iii) The Executive shall immediately notify the Company of any intended or unintended,
unauthorized disclosure or use of any Trade Secrets or
3
Confidential Information by the Executive or any other person of which the Executive
becomes aware. In addition to complying with the provisions of Section 4(c)(i) and
4(c)(ii), the Executive shall exercise his best efforts to assist the Company, to the extent
the Company deems reasonably necessary, in the procurement of any protection of the
Company’s rights to or in any of the Trade Secrets or Confidential Information.
(iv) Immediately upon termination of the Executive’s employment with the Company, or an
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 during 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, Western Europe, Brazil and Canada. The Executive and the Company each acknowledge that
the scope of the Restricted Territory is reasonable because (1) the Company is conducting
substantial business in all fifty states (as well as several foreign countries), (2) the Executive
occupies one of the top executive positions with the Company, and (3) the Executive will be
carrying out his employment responsibilities in all locations where the Company is doing business.
(e) NON-SOLICITATION OF CUSTOMERS. The Executive agrees that during the term of his
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 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 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
4
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 Executive’s violation of any of
the covenants in this Section 4 would not be an adequate or proper remedy and that should the
Executive violate or threaten to violate any of the provisions of such covenants, the Company or
its successors or assigns shall be entitled to obtain a temporary or permanent injunction against
Executive in any court having jurisdiction prohibiting any further violation of any such covenants,
in addition to any award or damages, compensatory, exemplary or otherwise, for such violation if
any.
(h) PARTIAL ENFORCEMENT. The Company has attempted to limit the rights of the Executive to
compete only to the extent necessary to protect the Company from unfair competition. The Company,
however, agrees that, if the scope of enforceability of these restrictive covenants is in any way
disputed at any time, a court or other trier of fact may modify and enforce the covenant to the
extent that it believes to be reasonable under the circumstances existing at the time.
5. TERMINATION.
(a) DEATH. The Executive’s employment hereunder shall terminate upon the death of the
Executive, provided, however, that for purposes of the payment of Base Salary to the Executive
under this Agreement the death of the Executive shall be deemed to have occurred ninety (90) days
from the last day of the month in which the death of the Executive shall have occurred.
(b) INCAPACITY. The Company may terminate the Executive’s employment hereunder at the end of
any calendar month by giving written Notice of Termination to the Executive in the event of the
Executive’s incapacity due to physical or mental illness which prevents the proper performance of
the duties of the Executive set forth herein or established pursuant hereto for a substantial
portion of any six (6) month period of the Executive’s term of employment hereunder. Any question
as to the existence, extent or potentiality of illness or incapacity of Executive upon which
Company and Executive cannot agree shall be determined by a qualified independent physician
selected by the Company and approved by Executive (or, if Executive is unable to give such
approval, by any adult member of the immediate family or the duly appointed guardian of the
Executive). The determination of such physician shall be certified in writing to the Company and
to the Executive and shall be final and conclusive for all purposes of this Agreement.
(c) CAUSE. The Company may terminate the Executive’s employment hereunder for Cause by giving
written Notice of Termination to the Executive. For the purposes
5
of this Agreement, the Company shall have “Cause” to terminate the Executive’s employment
hereunder upon: (i) the Executive’s habitual drunkenness or chronic substance abuse; (ii) a willful
failure by the Executive to materially perform and discharge the duties and responsibilities of the
Executive hereunder; (iii) any breach by the Executive of the provisions of Section 4 hereof; (iv)
any misconduct by the Executive that is materially injurious to the Company; or (v) a conviction of
a felony involving the personal dishonesty or moral turpitude of the Executive.
(d) WITHOUT CAUSE; GOOD REASON.
(i) The Company may terminate the Executive’s employment hereunder without Cause, by
giving written Notice of termination to the Executive.
(ii) The Executive may terminate his employment hereunder, by giving written Notice of
Termination to the Company. For the purposes of this Agreement, the Executive shall have
“Good Reason” to terminate his employment hereunder upon and without the written consent of
the Executive) (a) a reduction in the Executive’s base salary or 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
material breach by the Company of this Agreement.
(e) NOTICE OF TERMINATION. Any termination by the Company pursuant to the Subsections (b),
(c) or (d) (i) above or by the Executive pursuant to Subsection (d) (ii) above, shall be
communicated by written Notice of Termination from the party issuing such notice to the other party
hereto. 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 the Notice of Termination shall not be dated earlier than ninety
(90) days from the date such Notice is delivered or mailed to the applicable party.
(f) OBLIGATION TO PAY. Except upon voluntary termination by the Executive without Good
Reason, termination by the Company for Cause, or termination as a result of death or incapacity and
subject to Sections 6 and 16 below, the Company shall (i) pay the compensation specified in this
Subsection 5(f) to the Executive for the period specified in this Subsection 5(f), (ii) continue to
provide, no less frequently than monthly, life insurance benefits during the remainder of the
applicable period, including the Severance Period set forth in this Subsection 5(f), and (iii) if
and to the extent the Executive timely elects COBRA continuation coverage, pay the Executive on a
monthly basis the cost of COBRA premiums for a period of 18 months or such lesser period as the
Executive continues to have COBRA continuation coverage. If the Executive’s employment shall be
terminated by reason of death, the estate of the Executive shall be paid all Base Salary and
reimbursements 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, on the same basis as if the Executive had continued employment through such
times, and the Company
6
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 Base Salary and reimbursements and
payments 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,
on the same basis as if the Executive had continued employment through such times, 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 reimbursements otherwise
payable to the Executive and the Company shall have no further obligations to the Executive under
this Agreement. If the Executive’s employment shall be terminated by the Company, without cause,
or by the Executive for Good Reason, the Executive shall be paid all Base Salary and reimbursements
and payments 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 (x) continue to pay the Executive the Base Salary (at the rate in effect on
the date of such termination) for a period of one (1) year from the date of such termination (such
one (1) year period being referred to hereinafter as the “Severance Period”) on the same basis as
if Executive had continued employment during the Severance Period and (y) pay the Executive a pro
rata portion of the bonus or other incentive benefits to which the Executive would have been
entitled for the year of termination had the Executive remained employed for the entire year which
incentive compensation shall be payable at the time incentive compensation is payable generally
under the applicable incentive plans; provided, however, that notwithstanding the foregoing, the
Executive shall not be entitled to any severance payments under (x) and (y) upon and after reaching
age 65. The Executive shall have no further right to receive any other compensation, benefits or
perquisites after the date of termination of employment except as determined under the terms of
this Agreement or any applicable employee benefit plans or programs of the Company or under
applicable law.
6. CONDITIONS APPLICABLE TO SEVERANCE PERIOD; MITIGATION OF DAMAGES
(a) If during the Severance Period, the Executive breaches his obligations under Section 4
above, the Company may, upon written notice to the Executive, terminate the Severance Period and
cease to make any further payments or provide any benefits described in Subsection 5(f).
(b) Although the Executive shall not be required to mitigate the amount of any payment
provided for in Subsection 5(f) by seeking other employment, any such payments shall be reduced by
any amounts which the Executive receives or is entitled to receive from another employer with
respect to the Severance Period. The Executive shall promptly notify the Company in writing in the
event that other employment is obtained during the Severance Period.
7. 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:
7
AGCO Corporation
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
in the case of the Executive to:
Gary L. Collar
Hirsackerstrasse 63
CH-8810 Horgen, Switzerland
Hirsackerstrasse 63
CH-8810 Horgen, Switzerland
or to such other address as either party shall designate by giving written notice of such change to
the other party.
8. 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 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 7 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 8, 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.
8
| Executive initials: _______________ | Company initials: _______________ |
9. 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.
10. 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.
11. VALIDITY. The invalidity or unenforceability of any provision or 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.
12. SURVIVAL. The provisions of Section 4 hereof shall survive the termination of Executive’s
employment and shall be binding upon the Executive’s personal or legal representative, executors,
administrators, successors, heirs, distributee, devisees and legatees and the provisions of Section
5 hereof relating to payments and termination of the Executive’s employment hereunder shall survive
such termination and shall be binding upon the Company.
13. 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.
14. ENTIRE AGREEMENT. This Agreement constitutes the full agreement and understanding of the
parties hereto with respect to the subject matter hereof and all prior or contemporaneous
agreements or understandings are merged herein. The parties to this Agreement each acknowledge
that both of them and their respective agents and advisors were active in the negotiation and
drafting of the terms of this Agreement.
15. 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.
16. DEFERRED COMPENSATION PLAN OMNIBUS PROVISIONS. Notwithstanding any other provision of this
Agreement, it is intended that any payment or benefit which is provided pursuant to or in
connection with this Agreement which is considered to be deferred compensation subject to Section
409A of the Internal Revenue Code of 1986, as amended (the “Code”) shall be provided and paid in a
manner, and at such time, including without limitation payment and provision of benefits only in
connection with a permissible payment event contained in Section 409A (e.g., death or separation
from service from the Company and its affiliates as defined for purposes of Section 409A of the
Code), and in such form, as complies with the applicable requirements of Section 409A of the Code,
to avoid the unfavorable tax consequences provided therein for non-compliance. For purposes of
this Agreement, all rights to payments and benefits hereunder shall be treated as rights to receive
a
9
series of separate payments and benefits to the fullest extent allowed by Section 409A of the
Code. If Executive is a “specified employee” (as defined in Section 409A of the Code) and any of
the Company’s stock is publicly traded on an established securities market or otherwise, then
payment of any amount or provision of any benefit under this Agreement which is considered to be
deferred compensation subject to Section 409A of the Code shall be deferred for six (6) months as
required by Section 409A(a)(2)(B)(i) of the Code (the “409A Deferral Period”). In the event such
payments are otherwise due to be made in installments or periodically during the 409A Deferral
Period, the payments which would otherwise have been made in the 409A Deferral Period shall be
accumulated and paid in a lump sum as soon as the 409A Deferral Period ends, and the balance of the
payments shall be made as otherwise scheduled. In the event benefits are required to be deferred,
any such benefit may be provided during the 409A Deferral Period at Executive’s expense, with
Executive having a right to reimbursement from the Company once the 409A Deferral Period ends, and
the balance of the benefits shall be provided as otherwise scheduled. For purposes of this
Agreement, any termination of employment will be read to mean a “separation from service” within
the meaning of Section 409A of the Code where it is reasonably anticipated that no further services
would be performed after such date or that the level of bona fide services Executive would perform
after that date (whether as an employee or independent contractor) would permanently decrease to
less than fifty percent (50%) of the average level of bona fide services performed over the
immediately preceding thirty-six (36)-month period.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
| AGCO CORPORATION |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| EXECUTIVE |
||||
10
Exhibit 10.7
EMPLOYMENT AND SEVERANCE AGREEMENT
AS AMENDED AND RESTATED
AS AMENDED AND RESTATED
This Employment and Severance Agreement (the “Agreement”), originally effective as of the 1st
day of June 2000, is amended and restated this 5 day of December, 2007, to be effective as of
January 1, 2008, by AGCO CORPORATION, a Delaware corporation (the “Company”), and Randall G.
Hoffman (the “Executive”). This Agreement amends, restates and supersedes the Employment and
Severance Agreement between the Company and the Executive effective as of the 1st day of June 2000.
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 commenced on June 1, 2000 and shall continue in effect until
terminated in accordance with Section 5 or any other provision of the Agreement.
2. POSITION AND DUTIES.
The Executive shall serve as an Executive of the Company and shall perform such duties and
responsibilities as may from time to time be prescribed by the Company’s board of directors (the
“Board”), provided that such duties and responsibilities are consistent with the Executive’s
position. The Executive shall perform and discharge faithfully, diligently and to the best of his
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 Two Hundred and Ninety Thousand Dollars ($290,000), payable in equal semi-monthly installments
throughout the term of such employment subject to Section 5 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 the
Management Incentive Compensation Plan implemented by the Company.
(c) OTHER BENEFITS. During the term of this Agreement, the Executive shall be entitled to
participate in the long term incentive 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 promptly for all reasonable
and necessary expenses incurred by him/her 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, or reimburse the Executive for, all
expenses for fuel, maintenance and insurance in connection with such use of the automobile. In no
event will any such reimbursements or payments under this Subsection 3(d) be made, if at all, later
than the last day of the Executive’s taxable year next following the Executive’s taxable year in
which the Executive incurs the expense. The Company further agrees that Executive shall be
entitled to four (4) weeks of vacation in any year of the term of employment hereunder. Nothing
paid to the Executive under any such Company plans or arrangements shall be deemed to be in lieu of
compensation to the Executive hereunder.
4. NON-DISCLOSURE, NON-COMPETITION AND NON-SOLICITATION COVENANTS.
(a) ACKNOWLEDGEMENTS. The Executive acknowledges that as an Executive Officer 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/her to abide by the covenants set forth in this Section
4. The parties acknowledge and agree that if the nature of the Executive’s responsibilities for or
on behalf of the Company and the geographical areas in which the Executive must fulfill them
materially change, the parties will execute appropriate amendments to the scope of the covenants in
this Section 4.
(b) DEFINITIONS. For purposes of this Section 4, the following terms shall have the following
meanings:
(i) “COMPETITIVE POSITION” shall mean (i) the Executive’s direct or indirect equity ownership
(excluding equity ownership of less than one percent (1%) or control of all or any portion of a
Competitor, or (ii) any employment, consulting, partnership, advisory, directorship, agency,
promotional or independent contractor arrangement between the Executive and any Competitor whereby
the Executive is required to perform executive level services substantially similar to those that
he will perform for the Company as an Executive Manager.
(ii) “COMPETITOR” of the Company shall refer to any person or entity engaged, wholly or
partly, in the business of manufacturing and distributing farm equipment machinery and replacement
parts.
2
(iii) “CONFIDENTIAL INFORMATION” shall mean the proprietary and confidential data or
information of the Company, other than “Trade Secrets” (as defined below), which is of tangible or
intangible value to the Company and is not public information or is not generally known or
available to the Company’s competitors.
(iv) “TRADE SECRETS” shall mean information of the Company, including, but not limited to,
technical or non-technical data, formulas, patterns, compilations, programs, devices, methods,
techniques, drawings, processes, financial data, financial plans, products plans, or lists of
actual or potential customers or suppliers, which: (a) derives economic value, actual or potential,
from not being generally known to, and not being readily ascertainable by proper means by, other
persons who can obtain economic value from its disclosure or use; and (b) is the subject of efforts
that are reasonable under the circumstances to maintain its secrecy.
(v) “WORK PRODUCT” shall mean all work product, property, data, documentation, “know-how”,
concepts or plans, inventions, improvements, techniques, processes or information of any kind,
relating to the Company and its business prepared, conceived, discovered, developed or created by
the Executive for the Company or any of the Company’s customers.
(c) NONDISCLOSURE; OWNERSHIP OF PROPRIETARY PROPERTY.
(i) The Executive hereby covenants and agrees that: (i) with regard to information
constituting a Trade Secret, at all times during the Executive’s employment with the Company and
all times thereafter during which such information continues to constitute a Trade Secret; and (ii)
with regard to any Confidential Information, at all times during the Executive’s employment with
the Company and for three (3) years after the termination of the Executive’s employment with the
Company, the Executive shall regard and treat all information constituting a Trade Secret or
Confidential Information as strictly confidential and wholly owned by the Company and will not, for
any reason in any fashion, either directly or indirectly, use, sell, lend, lease, distribute,
license, give, transfer, assign, show, disclose, disseminate, reproduce, copy, appropriate or
otherwise communicate any such information to any party for any purpose other than strictly in
accordance with the express terms of this Agreement and other than as may be required by law.
(ii) To the greatest extent possible, any Work Product shall be deemed to be “work made for
hire” (as defined in the Copyright Act, 17 U.S.C.A. ss. 101 et seq., as amended) and owned
exclusively by the Company. The Executive hereby unconditionally and irrevocably transfers and
assigns to the Company all rights, title and interest the Executive may currently have or in the
future may have by operation of law or otherwise in or to any Work Product, including, without
limitation, all patents, copyrights, trademarks, service marks and other intellectual property
rights. The Executive agrees to execute and deliver to the Company any transfers, assignments,
documents or other instruments which the Company may deem necessary or appropriate to vest complete
title and ownership of any Work Product, and all rights therein, exclusively in the Company.
(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
3
exercise his best efforts to assist the Company, to the extent the Company deems reasonably
necessary, in the procurement of any protection of the Company’s rights to or in any of the Trade
Secrets or Confidential Information.
(iv) Immediately upon termination of the Executive’s employment with the Company, or at any
point prior to or after that time upon the specific request of the Company, the Executive shall
return to the Company all written or descriptive materials of any kind in the Executive’s
possession or to which the Executive has access that constitute or contain any Confidential
Information or Trade Secrets, and the confidentiality obligations of this Agreement shall continue
until their expiration under the terms of this Agreement.
(d) NON-COMPETITION. The Executive agrees that during 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, Western Europe, Brazil and Canada. The Executive and the Company each acknowledge that the
scope of the Restricted Territory is reasonable because (1) the Company is conducting substantial
business in all fifty states (as well as several foreign countries), (2) the Executive occupies one
of the top executive positions with the Company, and (3) the Executive will be carrying out his
employment responsibilities in all locations where the Company is doing business.
(e) NON-SOLICITATION OF CUSTOMERS. The Executive agrees that during the term of his
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 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 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
4
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 Executive’s violation of any of the
covenants in this Section 4 would not be an adequate or proper remedy and that should the Executive
violate or threaten to violate any of the provisions of such covenants, the Company or its
successors or assigns shall be entitled to obtain a temporary or permanent injunction against
Executive in any court having jurisdiction prohibiting any further violation of any such covenants,
in addition to any award or damages, compensatory, exemplary or otherwise, for such violation, if
any.
(h) PARTIAL ENFORCEMENT. The Company has attempted to limit the rights of the Executive to
compete only to the extent necessary to protect the Company from unfair competition. The Company,
however, agrees that, if the scope of enforceability of these restrictive covenants is in any way
disputed at any time, a court or other trier of fact may modify and enforce the covenant to the
extent that it believes to be reasonable under the circumstances existing at the time.
5. TERMINATION.
(a) DEATH. The Executive’s employment hereunder shall terminate upon the death of the
Executive, provided, however, that for purposes of the payment of Base Salary to the Executive
under this Agreement the death of the Executive shall be deemed to have occurred ninety (90) days
from the last day of the month in which the death of the Executive shall have occurred.
(b) INCAPACITY. The Company may terminate the Executive’s employment hereunder at the end of
any calendar month by giving written Notice of Termination to the Executive in the event of the
Executive’s incapacity due to physical or mental illness which prevents the proper performance of
the duties of the Executive set forth herein or established pursuant hereto for a substantial
portion of any six (6) month period of the Executive’s term of employment hereunder. Any question
as to the existence, extent or potentiality of illness or incapacity of Executive upon which
Company and Executive cannot agree shall be determined by a qualified independent physician
selected by the Company and approved by Executive (or, if Executive is unable to give such
approval, by any adult member of the immediate family or the duly appointed guardian of the
Executive). The determination of such physician shall be certified in writing to the Company and to
the Executive and shall be final and conclusive for all purposes of this Agreement.
(c) CAUSE. The Company may terminate the Executive’s employment hereunder for Cause by giving
written Notice of Termination to the Executive. For the purposes of this Agreement, the Company
shall have “Cause” to terminate the Executive’s employment hereunder upon: (i) the Executive’s
habitual drunkenness or chronic substance abuse; (ii) a willful failure by the Executive to
materially perform and discharge the duties and
5
responsibilities of the Executive hereunder; (iii) any breach by the Executive of the
provisions of Section 4 hereof; (iv) any misconduct by the Executive that is materially injurious
to the Company; or (v) a conviction of a felony involving the personal dishonesty or moral
turpitude of the Executive.
(d) WITHOUT CAUSE; GOOD REASON.
(i) The Company may terminate the Executive’s employment hereunder without Cause, by giving
written Notice of termination to the Executive.
(ii) The Executive may terminate his employment hereunder, by giving written Notice of
Termination to the Company. For the purposes of this Agreement, the Executive shall have “Good
Reason” to terminate his employment hereunder upon (and without the written consent of the
Executive) (a) a reduction in the Executive’s base salary or 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 material breach by the Company of
this Agreement.
(e) NOTICE OF TERMINATION. Any termination by the Company pursuant to the Subsections (1,),
(c) or (d)(i) above or by the Executive pursuant to Subsection (d)(ii) above, shall be communicated
by written Notice of Termination from the party issuing such notice to the other party hereto. 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 the Notice of Termination shall not be dated earlier than ninety (90) days
from the date such Notice is delivered or mailed to the applicable party.
(f) OBLIGATION TO PAY. Except upon voluntary termination by the Executive without Good
Reason, termination by the Company for Cause, or termination as a result of death or incapacity and
subject to Sections 6 and 16 below, the Company shall (i) pay the compensation specified in this
Subsection 5(f) to the Executive for the period specified in this Subsection 5(f), (ii) continue to
provide, no less frequently than monthly, life insurance benefits during the remainder of the
applicable period, including the Severance Period set forth in this Subsection 5(f), and (iii) if
and to the extent the Executive timely elects COBRA continuation coverage, pay the Executive on a
monthly basis the cost of COBRA premiums for a period of 18 months or such lesser period as the
Executive continues to have COBRA continuation coverage. If the Executive’s employment shall be
terminated by reason of death, the estate of the Executive shall be paid all Base Salary and
reimbursements 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, on the same basis as if the Executive had continued employment through such
times, 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 Base Salary and
reimbursements and payments otherwise payable to the Executive, including the bonus and other
benefits accrued or accruable
6
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 reimbursements
otherwise payable to the Executive and the Company shall have no further obligations to the
Executive under this Agreement. If the Executive’s employment shall be terminated by the Company,
without cause, or by the Executive for Good Reason, the Executive shall be paid all Base Salary and
reimbursements and payments 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 (x) continue to pay the Executive the Base Salary (at
the rate in effect on the date of such termination) for a period of one (1) year from the date of
such termination (such one (1) year period being referred to hereinafter as the “Severance Period”)
on the same basis as if Executive had continued employment during the Severance Period and (y) pay
the Executive a pro rata portion of the bonus or other incentive benefits to which the Executive
would have been entitled for the year of termination, had the Executive remained employed for the
entire year which incentive compensation shall be payable at the time incentive compensation is
payable generally under the applicable incentive plans; provided, however, that notwithstanding the
foregoing, the Executive shall not be entitled to any severance payments under (x) and (y) upon and
after reaching age 65. The Executive shall have no further right to receive any other compensation
benefits or perquisites after the date of termination of employment except as determined under the
terms of this Agreement or any applicable employee benefit plans or programs of the Company or
under applicable law.
6. CONDITIONS APPLICABLE TO SEVERANCE PERIOD; MITIGATION OF DAMAGES
(a) If during the Severance Period, the Executive breaches his obligations under Section 4
above, the Company may, upon written notice to the Executive, terminate the Severance Period and
cease to make any further payments or provide any benefits described in Subsection 5(f).
(b) Although the Executive shall not be required to mitigate the amount of any payment
provided for in Subsection 5(f) by seeking other employment, any such payments shall be reduced by
any amounts which the Executive receives or is entitled to receive from another employer with
respect to the Severance Period. The Executive shall promptly notify the Company in writing in the
event that other employment is obtained during the Severance Period.
7. 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
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
4205 River Green Parkway
Duluth, Georgia 30096
Attention: Stephen Lupton
7
in the case of the Executive to:
Randall G. Hoffman
247 Southern Hills Drive
Duluth, Georgia 30097
247 Southern Hills Drive
Duluth, Georgia 30097
or to such other address as either party shall designate by giving written notice of such change to
the other party.
8. 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 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 7 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 refines timely to name his arbitrator within the
time specified in this Section 8, 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: _________________ | Company initials: _________________ |
9. 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
8
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.
10. 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.
11. 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.
12. SURVIVAL. The provisions of Section 4 hereof shall survive the termination of Executive’s
employment and shall be binding upon the Executive’s personal or legal representative, executors,
administrators, successors, heirs, distributee, devisees and legatees and the provisions of Section
5 hereof relating to payments and termination of the Executive’s employment hereunder shall survive
such termination and shall be binding upon the Company.
13. 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.
14. ENTIRE AGREEMENT. This Agreement constitutes the full agreement and understanding of the
parties hereto with respect to the subject matter hereof and all prior or contemporaneous
agreements or understandings are merged herein. The parties to this Agreement each acknowledge that
both of them and theft respective agents and advisors were active in the negotiation and drafting
of the terms of this Agreement.
15. 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.
16. DEFERRED COMPENSATION PLAN OMNIBUS PROVISIONS. Notwithstanding any other provision of
this Agreement, it is intended that any payment or benefit which is provided pursuant to or in
connection with this Agreement which is considered to be deferred compensation subject to Section
409A of the Internal Revenue Code of 1986, as amended (the “Code”) shall be provided and paid in a
manner, and at such time, including without limitation payment and provision of benefits only in
connection with a permissible payment event contained in Section 409A (e.g., death or separation
from service from the Company and its affiliates as defined for purposes of Section 409A of the
Code), and in such form, as complies with the applicable requirements of Section 409A of the Code
to avoid the unfavorable tax consequences provided therein for non-compliance. For purposes of
this Agreement, all rights to payments and benefits hereunder shall be treated as rights to receive
a series of separate payments and benefits to the fullest extent allowed by Section 409A of the
Code. If Executive is a “specified employee” (as defined in Section 409A of the Code) and any of
the Company’s stock is publicly traded on an established securities market or otherwise, then
9
payment of any amount or provision of any benefit under this Agreement which is considered to
be deferred compensation subject to Section 409A of the Code shall be deferred for six (6) months
as required by Section 409A(a)(2)(B)(i) of the Code (the “409A Deferral Period”). In the event
such payments are otherwise due to be made in installments or periodically during the 409A Deferral
Period, the payments which would otherwise have been made in the 409A Deferral Period shall be
accumulated and paid in a lump sum as soon as the 409A Deferral Period ends, and the balance of the
payments shall be made as otherwise scheduled. In the event benefits are required to be deferred,
any such benefit may be provided during the 409A Deferral Period at Executive’s expense, with
Executive having a right to reimbursement from the Company once the 409A Deferral Period ends, and
the balance of the benefits shall be provided as otherwise scheduled. For purposes of this
Agreement, any termination of employment will be read to mean a “separation from service” within
the meaning of Section 409A of the Code where it is reasonably anticipated that no further services
would be performed after such date or that the level of bona fide services Executive would perform
after that date (whether as an employee or independent contractor) would permanently decrease to
less than fifty percent (50%) of the average level of bona fide services performed over the
immediately preceding thirty-six (36)-month period.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
| AGCO CORPORATION |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| EXECUTIVE | ||||
10
Exhibit 10.8
AGCO CORPORATION DIRECTOR COMPENSATION
FOR NON-EMPLOYEE DIRECTORS
(As of December 5, 2007)
FOR NON-EMPLOYEE DIRECTORS
(As of December 5, 2007)
RETAINERS (1) |
||||
Annual Lead Director Retainer (paid only to Lead Director): |
$ | 25,000 | ||
Annual Director Base Retainer (applies to all directors): |
$ | 40,000 | ||
Annual Committee Chairperson Retainer (except Audit Committee Chair): |
$ | 10,000 | ||
Annual Audit Committee Chairperson: |
$ | 15,000 | ||
Annual Committee Member Retainer: |
$ | 5,000 | ||
MEETING FEES |
||||
Board Meeting Attendance: |
$ | 2,000 | ||
Committee Meeting Attendance: |
||||
Chairperson: |
$ | 1,500 | ||
Members: |
$ | 1,000 | ||
Telephone Meeting Participation: |
||||
Chairperson: |
$ | 1,000 | ||
Members: |
$ | 500 | ||
ADDITIONAL COMPENSATION |
||||
Annual AGCO Stock Grant Award (2) |
$ | 75,000 |
In addition, the Company will reimburse directors for the reasonable out-of-pocket expense incurred
in the attendance of the meetings.
Notes:
| 1 | Payment of annual retainers are made in accordance with the following provisions: |
| (i) | Annual retainers are paid quarterly in four installments (for ease of calculation purposes quarters are divided into 90 days with a 360 day year). | ||
| (ii) | Annual retainers accrue as of the first day of each calendar quarter based on the Board and Committee Membership Roster in effect on that date. | ||
| (iii) | Annual Retainers are paid in advance during the first month of the given calendar quarter (e.g., January for the first quarter). | ||
| (iv) | Changes to Board and Committee Memberships (including chairpersons) will be reviewed and adjustments made to the current quarters retainer amounts (up or down). | ||
| (v) | Any changes in the retainer amounts due for the current quarter will be reflected in the ensuing quarters retainer payment. |
| 2 | Terms applicable to the Stock Grant Award are defined in the Plan Document. The stock grant equivalent to $75,000 is based on closing price on the day of the annual shareholders meeting. |