Exhibit 10
CHANGE
IN CONTROL SEVERANCE PROGRAM
OF DEERE & COMPANY
Effective as of August 26, 2009
TABLE OF
CONTENTS
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1.
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Purpose
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1
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2.
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Definitions
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1
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3.
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Eligibility
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7
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4.
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Severance Benefits
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7
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5.
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Form and Timing of
Severance Benefits
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10
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6.
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Excise Tax
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11
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7.
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The Company’s
Payment Obligation
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11
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8.
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Covenants and Release
of the Participants
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12
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9.
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Funding
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12
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10.
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Administration
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13
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11.
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Claims Procedure
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13
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12.
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Legal Fees
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14
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13.
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Successors and
Assignment
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14
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14.
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Miscellaneous
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15
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15.
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Effect on Prior
Agreements
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16
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- i -
CHANGE IN
CONTROL SEVERANCE PROGRAM
OF
DEERE & COMPANY
1.
Purpose
The purposes of the Program are (i) to provide Participants
with severance payments and benefits in the event of a Qualifying
Termination, (ii) to assure the Company that it will have the
continued dedication of the Participants and the availability of
their advice and counsel notwithstanding the possibility, threat,
or occurrence of a Change in Control of the Company, and
(iii) to provide an additional incentive for the Participants
to remain in the employ of the Company. The Program is
intended to be a “top-hat” plan for a select group of
management or highly compensated employees of the Company, but is
not intended to meet the qualification requirements of
Section 401 of the Internal Revenue Code of 1986, as amended
(the “ Code ”). The Company intends for
the Program to replace, over time, the bilateral change-in-control
agreements that the Company has previously entered into with
certain key executives and employees and, except for such bilateral
agreements, is not intended to affect eligibility for or payment of
any other compensation or benefits in accordance with the terms of
any applicable plans or programs of the Company.
2.
Definitions
Whenever used in the Program, the following terms shall have the
meanings set forth below and, when the meaning is intended, the
initial letter of the word is capitalized:
(a)
“
Administrator ” means the Company’s Vice
President, Human Resources or such other person designated by the
Committee.
(b)
“ Base
Salary ” means a Participant’s annual rate of
salary, excluding amounts received under incentive or other bonus
plans, whether or not deferred.
(c)
“
Beneficial Owner ” shall have the meaning ascribed to
such term in Rule 13d-3 of the General Rules and
Regulations under the Exchange Act.
(d)
“
Board ” means the Board of Directors of the
Company.
(e)
“
Bonus ” means the target bonus
amount for a Participant for the fiscal year in which the Effective
Date of Termination occurs pursuant to the John Deere Short -Term
Incentive Bonus Plan or any successor plan or arrangement
thereto. The Bonus will be determined (i) for Tier 1
Participants by the Committee and (ii) for Tier 2 Participants
in accordance with the terms and procedures of the Deere Short
-Term Incentive Bonus Plan or any successor plan or arrangement
thereto. For purposes of the Program, the term
“Bonus” shall not include any payments made pursuant to
the Company’s Mid-Term Incentive Plan, Long-Term Incentive
Plan or any successor plans or arrangements thereto.
1
(f)
“
Cause ” means (i) a Participant’s willful
and continued failure to substantially perform his duties with the
Company (other than any such failure resulting from Disability or
occurring after issuance by a Participant of a Notice of
Termination for Good Reason), after a written demand for
substantial performance is delivered to such Participant that
specifically identifies the manner in which the Company believes
that such Participant has willfully failed to substantially perform
his duties, and after such Participant has failed to resume
substantial performance of his duties on a continuous basis within
thirty (30) calendar days of receiving such demand; (ii) a
Participant’s willfully engaging in conduct (other than
conduct covered under (i) above) which is demonstrably and
materially injurious to the Company, monetarily or otherwise; or
(iii) a Participant’s having been convicted of, or
having entered a plea of nolo contendere to, a felony.
For purposes of this definition, no act, or failure to act, on a
Participant’s part shall be deemed “willful”
unless done, or omitted to be done, by a Participant not in good
faith and without reasonable belief that the action or omission was
in the best interests of the Company.
(g)
“ Change
in Control ” means a change in control of a nature that
would be required to be reported in response to Schedule 14A of
Regulation 14A promulgated under the Exchange Act whether or not
the Company is then subject to such reporting requirement, provided
that, without limitation, such a Change in Control shall be deemed
to have occurred if:
(i)
any
“person” (as defined in Sections 13(d) and
14(d) of the Exchange Act) (other than a Participant or group
of Participants, the Company or a subsidiary, any employee benefit
plan of the Company including its trustee, or any corporation or
similar entity which becomes the Beneficial Owner of securities of
the Company in connection with a transaction excepted from the
provisions of clause (iii) below) is or becomes the
“beneficial owner” (as defined in Rule 13(d-3)
under the Exchange Act), directly or indirectly, of securities of
the Company (not including the securities beneficially owned or any
securities acquired directly from the Company) representing thirty
percent (30%) or more of the combined Voting Power of the
Company’s then outstanding securities;
(ii)
the following
individuals shall cease to constitute a majority of the
Board: individuals who on the Participation Date constitute
the Board and any new director(s) whose appointment or
election by the Board or nomination for election by the
Company’s stockholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who either
were directors on the Participation Date or whose appointment or
election or nomination for election was previously so approved but
excluding, for this purpose, any such new director whose initial
assumption of office occurs as a result of an actual or threatened
election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a person other than the
Board;
(iii)
there is
consummated a merger, consolidation or similar business combination
transaction of the Company (including, for the avoidance of
doubt,
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any business
combination structured as a forward or reverse triangular merger
involving any direct or indirect subsidiary of the Company) with
any other company, other than a merger, consolidation or similar
business combination transaction which would result in the voting
securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity or
any parent thereof) at least sixty percent (60%) of the combined
Voting Power of the voting securities of the Company or such
surviving entity or parent thereof outstanding immediately after
such merger, consolidation or similar business combination
transaction; or
(iv)
the stockholders
of the Company approve a plan of complete liquidation of the
Company or there is consummated an agreement for the sale or
disposition by the Company of all or substantially all of the
Company’s assets.
(h)
“ CIC
Agreement ” means a change in control agreement entered
into between the Company and an executive or other
employee.
(i)
“
Code ” means the United States Internal Revenue Code
of 1986, as amended, and any successors thereto.
(j)
“
Committee ” means the Compensation Committee of the
Board or any other committee of the Board appointed by the Board to
perform the functions of the Compensation Committee.
(k)
“
Company ” means Deere & Company, a Delaware
corporation, or any successor thereto as provided in
Section 13(a) herein.
(l)
“
Disability ” means complete and permanent inability by
reason of illness or accident to perform the duties of the
occupation at which a Participant was employed when such disability
commenced.
(m)
“Divestiture
” means a
transaction in which (x) the entity that employs a Participant
is sold, spun-off or otherwise disposed of by the Company with the
result that such entity is no longer a 409A Affiliate, or
(y) the business unit or division in which the Participant is
employed is spun-off as a separate entity that is not a 409A
Affiliate or is sold or otherwise transferred to a third party that
is not a 409A Affiliate.
(n)
“
Effective Date of Termination ” means the date on
which a Qualifying Termination occurs which triggers the payment of
Severance Benefits hereunder.
(o)
“
Employment ” means a Participant’s employment
with the Company or any of its 409A Affiliates.
(p)
“
ERISA ” means the Employee Retirement Income Security
Act of 1974, as amended.
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(q)
“
Exchange Act ” means the United States Securities
Exchange Act of 1934, as amended.
(r)
“ Good
Reason ” means, without a Participant’s express
written consent, the occurrence of any one or more of the
following:
(i)
The assignment of
a Participant to duties materially inconsistent with such
Participant’s authorities, duties, responsibilities, and
status (including offices and reporting requirements) as an
employee of the Company, or a reduction or alteration in the nature
or status of a Participant’s authorities, duties, or
responsibilities from the greater of (i) those in effect on
the Participation Date; (ii) those in effect during the fiscal
year immediately preceding the year of the Change in Control; or
(iii) those in effect immediately preceding the Change in
Control;
(ii)
The
Company’s requiring a Participant to be based at a location
which is at least fifty (50) miles further from the current primary
residence than is such residence from the Company’s current
headquarters, except for required travel on the Company’s
business to an extent substantially consistent with such
Participant’s business obligations as of the Participation
Date;
(iii)
A reduction by
the Company in a Participant’s Base Salary as in effect on
the Participation Date or as the same shall be increased from time
to time;
(iv)
A material
reduction in a Participant’s level of participation in any of
the Company’s short-, mid- and/or long-term incentive
compensation plans, or employee benefit or retirement plans,
policies, practices, or arrangements in which such Participant
participates from the levels in place during the fiscal year
immediately preceding the Change in Control; provided, however,
that reductions in the levels of participation in any such plans
shall not be deemed to be “Good Reason” if a
Participant’s reduced level of participation in each such
program remains substantially consistent with the average level of
participation of other executives who have positions commensurate
with such Participant’s position;
(v)
The failure of
the Company to obtain a satisfactory agreement from any successor
to the Company to assume and agree to perform the obligations under
the Program, as contemplated in 13(a) herein; or
(vi)
Any involuntary
termination of a Participant’s Employment that is not
effected pursuant to a Notice of Termination.
The
existence of Good Reason shall not be affected by a
Participant’s temporary incapacity due to physical or mental
illness not constituting a Disability. A Participant’s
continued employment shall not constitute a waiver of such
Participant’s rights with respect to any circumstance
constituting Good Reason.
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(s)
“
Multiplier ” shall mean (i) three (3) in the
case of a Tier 1 Participant and (ii) one and one-half (1.5)
in the case of a Tier 2 Participant.
(t)
“ Notice
of Termination ” shall mean a written notice which shall
indicate the specific termination provision in the Program relied
upon, and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of a
Participant’s Employment under the provision so
indicated.
(u)
“
Participant ” means each person who is designated to
be a Tier 1 Participant or Tier 2 Participant under the
Program.
(v)
“
Participation Date ” means, with respect to each
Participant, the date specified by the Committee or the
Administrator as provided in Section 3(a) as of which
such individual becomes a Participant in the Program. If a
Participant who is designated a Tier 2 Participant is subsequently
designated a Tier 1 Participant, or if a Tier 1 Participant is
subsequently designated in accordance with Section 3(c) a
Tier 2 Participant, then from and after the effective date of such
later designation, the Participant’s Participation Date will
be such effective date.
(w)
“
Payment Date ” shall have the meaning ascribed to such
term in Section 5(a) herein.
(x)
“
Person ” shall have the meaning ascribed to such term
in Section 3(a)(9) of the Exchange Act and used in
Sections 13(d) and 14(d) thereof, including a
“group” as provided in Section 13(d).
(y)
“Post-Divestiture
Employer ” means, in the case of
a Participant whose employment is with an entity, business unit or
division that is the subject of a Divestiture and who immediately
following the Divestiture continues to be employed with such
entity, business unit or division, the Participant’s employer
immediately following the Divestiture (including all entities that
are considered to be a single employer with such party under the
default provisions in Treasury Regulations
Section 1.409A-1(h)).
(z)
“
Potential Change in Control ” of the Company means the
happening of any of the following:
(i)
the entering into
an agreement by the Company, the consummation of which would result
in a Change in Control of the Company as defined in
Section 2(g) hereof; or
(ii)
the acquisition
of beneficial ownership, directly or indirectly, by any entity,
person or group (other than a Participant or group of Participants,
the Company or a subsidiary, or any employee benefit plan of the
Company including its trustee) of securities of the Company
representing fifteen percent (15%) or more of the combined voting
power of the Company’s outstanding securities and the
adoption by the Board of a resolution to the effect that a
Potential Change in Control of the Company has occurred for
purposes of the Program.
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(aa)
“
Program ” means this Change in Control Severance
Program of Deere & Company and its Subsidiaries, as
subsequently amended from time to time.
(bb)
“
Release ” shall have the meaning ascribed to such term
in Section 8 herein.
(cc)
“
Release Deadline ” shall have the meaning ascribed to
such term in Section 8 herein.
(dd)
“
Qualifying Termination ” means any of the events
described in Section 4(b) herein, the occurrence of which
triggers the payment of Severance Benefits hereunder.
(ee)
“
SEC ” means the United States Securities and Exchange
Commission.
(ff)
“
Severance Benefits ” means the payment of severance
compensation as provided in
Section 4(d) herein.
(gg)
“
Subsidiary ” means any corporation or other entity of
which ownership interests having ordinary Voting Power to elect a
majority of the board of directors or other persons performing
similar functions are at the time directly or indirectly owned by
the Company.
(hh)
“ Tier 1
Participant ” means each person who is designated by the
Committee as a Tier 1 Participant.
(ii)
“ Tier 2
Participant ” means each person who is designated by the
Administrator as a Tier 2 Participant.
(jj)
“ Voting
Power ” of a corporation or other entity means the
combined voting power of the then-outstanding voting securities of
such corporation or other entity entitled to vote generally in the
election of directors.
(kk)
“ 409A
Affiliate ” means any corporation that is included in a
controlled group of corporations (within the meaning of
Section 414(b) of the Code) that includes the Company and
any trade or business (whether or not incorporated) that is under
common control with the Company (within the meaning of
Section 414(c) of the Code), provided that in applying
Section 1563(a)(1), (2), and (3) of the Code for purposes of
determining a controlled group of corporations under Section
414(b), the language “at least 20 percent” is used
instead of “at least 80 percent” each place it
appears in Section 1563(a)(1), (2), and (3), and in applying
Section 1.414(c)-2 of the Treasury Regulations for purposes of
determining trades or businesses (whether or not incorporated) that
are under common control for purposes of Section 414(c),
“at least 20 percent” is used instead of “at
least 80 percent” each place it appears in
Section 1.414(c)-2.
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3.
Eligibility
(a)
Designation of
Participants . Tier 1 Participants
shall be designated in writing from time to time by the Committee
in its discretion. Tier 2 Participants shall be designated in
writing from time to time by the Committee or the
Administrator. At the time an individual is designated as a
Participant, the Committee or the Administrator, as the case may
be, shall specify such individual’s Participation Date (which
may, but need not, be the date of the Committee or the
Administrator action designating the individual as a
Participant). The books and records of the Company shall be
definitive for purposes of determining whether and as of when an
individual has been designated as a Participant.
(b)
Participation
Exclusive . Unless and until an
individual has been designated as a Participant and the relevant
Participation Date has occurred, such individual shall have no
rights under the Program, regardless of whether any other
individual with a similar position, rate of compensation or
responsibilities has become a Participant. No individual
shall become a Participant while such individual is party to an
effective CIC Agreement, and in no event may any individual have
entitlements under both the Program and a CIC
Agreement.
(c)
Termination of
Participation . The Committee, with
respect to Tier 1 Participants (including, for this purpose, a Tier
1 Participant who is being converted to a Tier 2 Participant), and
the Committee or the Administrator, with respect to Tier 2
Participants, may provide notice to a Participant at any time that
such Participant shall cease to be a Participant. Any such
termination or reduction of Participant status shall become
effective on the earliest anniversary of the relevant
Participant’s Participation Date that is at least six
(6) months from the date of the notice of termination or
reduction of Participant status, provided, however, that no such
termination or reduction of Participant status shall be effective
prior to the second anniversary of the Participant’s
Participation Date; provided, further, that no notice of
termination or reduction of Participant status shall be given
within six (6) months following a Potential Change in Control;
and provided, further, that following a Change in Control, no such
termination or reduction of Participant status shall be given
effect until the later of (i) twenty-four (24) months after
the month in which the Change in Control occurs or (ii) if a
Participant experiences a Qualifying Termination before the end of
such twenty-four (24) month period, until all obligations of the
Company under the Program have been fulfilled and all benefits
required under the Program have been paid or provided to the
Participant.
4.
Severance Benefits
(a)
Right to
Severance Benefits . Subject to Section 8,
a Participant shall be entitled to receive from the Company the
Severance Benefits described in Section 4(d) if a
Qualifying Termination of such Participant has occurred. A
Participant shall not be entitled to receive Severance Benefits if
he or she is terminated for Cause, or if his or her Employment ends
due to death or Disability or due to a voluntary termination of
Employment without Good Reason. An individual who has ceased
to be a
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Participant in the
Program in accordance with Section 3(c) shall not be
entitled to any Severance Benefits under the Program in connection
with his or her termination of Employment for any reason, even if
such termination of Employment would have qualified as a Qualifying
Termination had the individual been a Participant at the time of
his or her termination of Employment. No Severance Benefits
shall be payable under the Program to any individual if the Program
has been terminated as to such individual in accordance with
Section 14(d) at the time of such individual’s
termination of Employment.
(b)
Qualifying
Termination . Subject to
Section 8, the occurrence of any one or more of the following
events shall trigger the payment of Severance Benefits to a
Participant under the Program:
(i)
An involuntary
termination of a Participant’s Employment for reasons other
than Cause within six (6) months preceding or within
twenty-four (24) calendar months following a Change in Control of
the Company; any such involuntary termination shall be pursuant to
a Notice of Termination (specifying the Effective Date of
Termination which shall be not less than five (5) days from
the date of the Notice of Termination) delivered to such
Participant by the Company; or
(ii)
A
Participant’s voluntary termination of Employment for Good
Reason within twenty-four (24) calendar months following a Change
in Control of the Company pursuant to a Notice of Termination
delivered to the Company by such Participant.
For purposes of the Program,
a Participant’s Employment will be considered to have
terminated upon (and only upon) such Participant’s
“separation from service” from the Company and its 409A
Affiliates as determined under the default provisions in Treasury
Regulation Section 1.409A-1(h).
(c)
Divestitures
. Without
limiting the generality of the foregoing Section 4(b), if the
entity, business unit or division that employs a Participant is the
subject of a Divestiture, the
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