Exhibit 10.iii.a
SENIOR MANAGEMENT SEVERANCE AND
CHANGE IN CONTROL AGREEMENT
This Senior Management Severance and
Change in Control Agreement (“Agreement”) is made and
entered into effective as of [ENTER DATE] (“Agreement
Date”) between THE MOSAIC COMPANY (the
“Company”), having its principal place of business in
Minnesota, and [NAME IN ALL CAPS] (“Employee”),
a resident of [ENTER CITY AND STATE] , for the purpose of
providing for certain benefits in the event of termination of
Employee’s employment by the Company without Cause or by
Employee for Good Reason, according to the terms, conditions, and
obligations set forth below.
RECITALS
WHEREAS , the Company has employed Employee as [
ENTER TITLE ] and Employee desires to serve in that
capacity;
WHEREAS, Employee is a key member of the management of
the Company and is expected to devote substantial skill and effort
to the affairs of the Company, and the Company desires to recognize
the significant personal contribution that Employee makes and is
expected to continue to make to further the best interests of the
Company and its shareholders;
WHEREAS , as a further term and condition of
Employee’s employment, the Company desires to provide
Employee the opportunity to receive certain benefits upon
termination of Employee’s employment by the Company without
Cause or by Employee for Good Reason, according to the terms,
conditions, and obligations set forth below;
WHEREAS, it is desirable and in the best interests of the
Company and its shareholders to continue to obtain the benefits of
Employee’s services and attention to the affairs of the
Company. It is desirable and in the best interests of the Company
and its shareholders to provide inducement for Employee (1) to
remain in the service of the Company in the event of any proposed
or anticipated change in control of the Company and (2) to
remain in the service of the Company in order to facilitate an
orderly transition in the event of a change in control of the
Company;
WHEREAS, it is desirable and in the best interests of the
Company and its shareholders that Employee be in a position to make
judgments and advise the Company with respect to proposed changes
in control of the Company without regard to the possibility that
Employee’s employment may be terminated without compensation
in the event of certain changes in control of the
Company;
WHEREAS , Employee understands that Employee’s
receipt of the benefits provided for in this Agreement depends on,
among other things, Employee’s willingness to execute a
General Release of Claims in favor of the Company upon termination
and to agree to and abide by the non-disclosure, non-competition,
and non-solicitation covenants contained in this
Agreement;
WHEREAS, it is desirable and in the best interests of the
Company and its shareholders to protect confidential, proprietary
and trade secret information of the Company, to prevent unfair
competition by former executives of the Company following
separation of their employment with the Company and to secure
cooperation from former executives with respect to matters related
to their employment with the Company; and
WHEREAS , Employee understands that nothing in this
Agreement limits the Company’s right to terminate
Employee’s employment at any time and for any
reason.
NOW THEREFORE
, in consideration of
Employee’s employment with the Company and the foregoing
premises, the mutual covenants set forth below, and other good and
valuable consideration, the receipt and adequacy of which are
hereby acknowledged, Employee and the Company agree as
follows:
AGREEMENT
1. Limited Right to Certain
Benefits upon Termination. Nothing in this Agreement guarantees
Employee continued employment with the Company or otherwise limits
the Company’s right to terminate Employee’s employment
at any time and for any reason. In the event of termination of
Employee’s employment by the Company without Cause or by
Employee for Good Reason (as each term is defined below), however,
Employee shall be eligible to receive certain benefits upon
satisfaction of certain conditions, as set forth in this Agreement
below. Such benefits are not available to Employee under this
Agreement in the event of a termination by the Company with Cause,
by the Employee without Good Reason, or due to the Employee’s
death or disability.
2. Termination by Company for
“Cause.” In the event the Company terminates
Employee’s employment for Cause, the Company’s
obligations to Employee hereunder shall terminate, except as to
amounts already earned by but unpaid to Employee as of the
effective date of termination. Employee’s continuing
obligations to the Company under this Agreement, however, shall
remain in full force and effect, including without limitation with
respect to non-disclosure, non-competition, and non-solicitation.
For purposes of this Agreement, Cause means a good faith
determination by the Company of an act or omission by Employee
amounting to:
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(i)
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a material
breach of any of Employee’s obligations to the Company under
the terms of this Agreement;
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(ii)
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the gross
neglect or willful failure or refusal of Employee to perform the
duties of Employee’s position or such other duties reasonably
assigned to Employee by the Company;
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(iii)
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any act of
personal dishonesty taken by Employee and intended to result in
substantial personal enrichment of Employee at the expense of the
Company;
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(iv)
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any willful or
intentional act that could reasonably be expected to injure the
reputation, business, or business relationships of the Company or
Employee’s reputation or business relationships;
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(v)
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perpetration of
an intentional and knowing fraud against or affecting the Company
or any customer, supplier, client, agent, or employee thereof;
or
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(vi)
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conviction
(including conviction on a nolo contendere , no contest, or
similar plea) of a felony or any crime involving fraud, dishonesty,
or moral turpitude.
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3. Termination by the Company Due
To Employee’s Death or Disability. Employee’s
employment shall terminate immediately upon Employee’s death
or upon a finding and declaration by the Company, determined in
good faith and subject to applicable law, that Employee is unable
to carry out Employee’s essential job functions to any
substantial degree by reason of illness or disability. In either
such case, the Company’s obligations to Employee hereunder
shall terminate, except as to amounts already earned by but unpaid
to Employee, as of the effective date of termination.
Employee’s continuing obligations to the Company under this
Agreement, however, shall remain in full force and effect,
including without limitation with respect to non-disclosure,
non-competition, and non-solicitation.
4. Termination by the Company
without Cause. The Company may elect to terminate
Employee’s employment without Cause at any time, with or
without prior notice to Employee, in which case Employee shall
receive amounts already earned by but unpaid to Employee as of the
effective date of termination and be eligible for the following
additional benefits:
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(a)
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Employee shall
be eligible to receive an amount equal to one times
Employee’s annual base salary in effect as of the date of
termination; provided, however , that if the effective date
of termination by the Company without Cause occurs (i) upon,
or within two years after, the occurrence of a Change in Control of
the Company (as defined in Section 7 below), or (ii) at
the time of, or following, the entry by the Company into a
definitive agreement or plan for a Change in Control of the nature
set forth in Section 7(b), (c) or (e) below that
occurs within six months after the effective date of such
termination, then such amount shall be equal to [three (Chief
Executive Officer)/two (other executive officers)] times
Employee’s annual base salary. Any amounts payable hereunder
will be subject to required withholdings, deductions, and tax
reporting requirements.
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(b)
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Employee shall
be eligible to receive a payout equal to Employee’s annual
target bonus established for the bonus year in which
Employee’s date of termination is effective ; provided,
however , that if the effective date of termination by the
Company without Cause occurs (i) upon, or within two years
after, the occurrence of a Change in Control of the Company (as
defined in Section 7 below), or (ii) at the time of, or
following, the entry by the Company into a definitive agreement or
plan for a Change in Control of the nature set forth in
Section 7(b), (c) or (e) below that occurs within
six months after the effective date of such termination, then such
payout shall be equal to [three (Chief Executive Officer)/two
(other executive officers)] times Employee’s annual target
bonus. Any amounts payable hereunder will be subject to any
required withholdings, deductions, and tax reporting
requirements.
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(c)
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If Employee is participating in
any Company-provided group health and/or dental plan as of the
effective date of termination of employment, and if Employee elects
continued coverage under the Consolidated Omnibus Budget
Reconciliation Act of 1986, as amended, or similar state law
(“COBRA”), the Company will, upon
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request of Employee, reimburse
Employee for a portion of the premium costs to continue coverage
under its medical and/or dental plans equal to the portion the
Company would pay for such coverage as if Employee were an active
employee, from the date of termination until (i) twelve
(12) months following the date of termination or
(ii) eighteen (18) months following the date of
termination if the effective date of termination by the Company
without Cause occurs (A) upon, or within two years after, the
occurrence of a Change in Control of the Company (as defined in
Section 7 below or (B) at the time of, or following, the
entry by the Company into a definitive agreement or plan for a
Change in Control of the nature set forth in Section 7(b),
(c) or (e) below that occurs within six months after the
effective date of such termination); provided, however ,
that in no case shall such reimbursement of premiums continue
after the date on which COBRA coverage is no longer available
to Employee. Employee must timely elect coverage and satisfy all
enrollment and payment procedures established by Company as a
prerequisite to reimbursement of premiums for the continuation of
coverage under this Section 4(c).
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(d)
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If Employee was
employed by the Company for three months or more during the fiscal
year in which the termination of employment is effective, the
Company will pay to Employee a pro rata portion (based on the
number of calendar days of employment during such fiscal year) of
any annual bonus that would have been payable to Employee for such
fiscal year based on actual performance under the Management
Incentive Plan (or a successor to such plan) determined upon
completion of the fiscal year as if Employee had been in the employ
of the Company for the full fiscal year. No annual bonus shall be
payable to Employee with respect to any fiscal year in which
Employee was employed by the Company for less than three
months.
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(e)
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The Company
will pay Employee any unused earned vacation as of the date of
Employee’s termination of employment, in accordance with the
policies and practices of the Company in effect from time to
time.
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(f)
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The Company
will offer Employee executive level outplacement services
commensurate with Employee’s position and experience for a
period no longer than twelve (12) months following
Employee’s termination of employment or until Employee finds
new employment, whichever occurs first. The cost of outplacement
services furnished will be capped at a maximum of $25,000. Cash
will not be paid in lieu of outplacement services. Employee shall
be responsible for any individual tax consequences, if any,
relating to the provision of these services.
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(g)
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The amount of
any severance payable to Employee under Section 4 shall be
reduced on a dollar-for-dollar basis by the amount of any other
compensation or remuneration Employee receives from Company for
work performed as an employee, independent contractor, or
consultant during the twelve (12) months following
Employee’s termination of employment, and by any other
compensation to which Employee may be entitled under any other
severance plan or program of the Company.
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(h)
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Receipt of the
base salary amount, target bonus payout, reimbursement for benefits
continuation, and outplacement services as described in this
Section 4 above is contingent upon (i) Employee first
signing, and not rescinding or revoking, a General Release of
Claims in favor of the Company, in a form acceptable to the
Company, (ii) Employee cooperating with the transition of
Employee’s duties and responsibilities for the Company, and
(iii) Employee continuing to abide by all of Employee’s
obligations to the Company, including without limitation the
non-disclosure, non-competition, and non-solicitation covenants
contained in Section 8 of this Agreement.
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(i)
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Any payments
Employee is eligible to receive under Sections 4(a) or 4(b) shall
be paid to Employee on the first day of the seventh month following
the effective date of termination or, if later, on the day
following Executive’s “separation from service”
as such phrase is interpreted under section 409A of the Internal
Revenue Code and any regulations, rules or guidance thereunder. Any
payment Employee is eligible to receive under Section 4(d)
shall be paid to Employee upon the later of: (x) the date that
annual bonuses for the fiscal year to senior management of the
Company and (y) the first day of the seventh month following
the effective date of termination or, if later, on the day
following Executive’s “separation from service”
as such phrase is interpreted under section 409A of the Internal
Revenue Code and any regulations, rules or guidance
thereunder.
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5. Termination by the Employee
with “Good Reason.” Employee may terminate
Employee’s employment with the Company for “Good
Reason,” which, for purposes of this Agreement shall
mean:
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(a)
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Employee
receives a material demotion in status or duties; or
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(b)
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any requirement
by the Company that Employee move his regular office to a location
more than 50 miles from Employee’s Company office as of the
Agreement Date;
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Good Reason shall not exist if
Employee expressly consents to such event in writing or Employee
fails to object in writing to such event within sixty
(60) days of its effective date and the Company fails to cure
such event within thirty (30) days after written notice from
Employee, such notice to describe the basis for Employee’s
claim of Good Reason and identify what reasonable actions would be
required to cure such Good Reason. Employee agrees to continue to
perform the duties of Employee’s position and to otherwise
cooperate with the Company throughout this entire notice period. If
Good Reason is not cured by the Company and Employee then
terminates employment effective within thirty (30) days
following the expiration of the Company’s cure period,
Employee shall receive amounts already earned by but unpaid to
Employee as of the effective date of termination and be paid or
reimbursed for additional benefits in the same manner as set forth
in Sections 4(a) through 4(i) above.
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6. Termination by Employee
without Good Reason. Employee may elect to terminate
Employee’s employment at any time and for any reason, upon
thirty (30) days’ prior written notice to the Company.
Employee agrees to continue to perform the duties of
Employee’s position and to otherwise cooperate with the
Company throughout this entire notice period. The Company may,
however, upon receiving such notice of termination, elect to make
the termination effective at any earlier time during the notice
period. In either case if such termination is without Good Reason,
salary and benefits shall be paid to Employee through
Employee’s effective termination date only, and the Company
shall have no further obligation to Employee. Employee’s
continuing obligations to the Company under this Agreement,
however, shall remain in full force and effect, including without
limitation with respect to non-disclosure, non-competition, and
non-solicitation.
7. Effect of a Change in Control
on Equity. Upon a Change in Control of the Company, all
unvested outstanding stock options, restricted stock, restricted
stock units, or similar equity based awards granted to Employee
shall immediately vest without any further act or requirement of
Employee. Notwithstanding anything herein stated, no Change in
Control shall occur under subparagraph (a), (b) or (c) of
this Section 7 as long as Cargill, Incorporated
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