Exhibit 10.1
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT
(the “Agreement”) dated as of July 26, 2007
(the “Effective Date”) by and between Celanese
Corporation (the “Company”) and John J.
Gallagher III (the “Executive”).
The Company desires
to employ Executive and to enter into an agreement embodying
the terms of such employment;
Executive desires to
accept such employment and enter into such an agreement;
In consideration of
the premises and mutual covenants herein and for other good
and valuable consideration, the parties agree as
follows:
1. Term of
Employment. Subject to the provisions of Section 7 of
this Agreement, Executive shall be employed by the Company for
a period commencing as of the Effective Date and ending on
March 31, 2010 (the “Employment Term”) on the
terms and subject to the conditions set forth in this
Agreement. A termination of Executive’s employment with
the Company as a result of expiration of the Employment Term
shall be referred to as a “Non-Renewal” of this
Agreement.
2. Position.
a. During the
Employment Term, Executive shall serve as the Company’s
Executive Vice President and President, Acetyls Intermediates
and Celanese Asia. In such position, Executive shall have such
duties and authority as shall be determined from time to time
by the Board of Directors of the Company (the
“Board”) and the Chief Executive Officer of the
Company.
b. During the
Employment Term, Executive will devote Executive’s full
business time and best efforts to the performance of
Executive’s duties hereunder and will not engage in any
other business, profession or occupation for compensation or
otherwise which would conflict or interfere with the rendition
of such services either directly or indirectly, without the
prior written consent of the Board; provided that nothing
herein shall preclude Executive, (i) subject to the prior
approval of the Board, from accepting appointment to or
continue to serve on any board of directors or trustees of any
business corporation or any charitable organization or
(ii) from participating in charitable activities or
managing personal investments; provided in each case, and in
the aggregate, that such activities do not conflict or
interfere with the performance of Executive’s duties
hereunder or conflict with Section 8.
3. Base Salary.
During the Employment Term, the Company shall pay Executive a
base salary at the annual rate of $675,000, payable in regular
installments in accordance with the Company’s usual
payment practices. Executive shall be entitled to such
increases (but no decreases) in Executive’s base salary,
if any, as may be determined from time to time in the sole
discretion of the Board. Executive’s annual base salary,
as in effect from time to time, is hereinafter referred to as
the “Base Salary”.
4. Annual Bonus.
With respect to each full calendar year during the Employment
Term, Executive shall be eligible to earn an annual bonus
award (an “Annual Bonus”) targeted at eighty
percent (80%) of Executive’s Base Salary (the
“Target”), payout to range from 0-200% of Target,
based upon the achievement of performance targets established
by the Board.
5. Employee
Benefits; NQSOs. During the Employment Term, Executive shall
be entitled to participate in the Company’s compensation
and employee benefit plans (other than annual bonus and
severance plans) as in effect from time to time (collectively
Employee Benefits”), on the same basis as those benefits
are generally made available to other senior executives of the
Company. Executive shall also receive certain relocation and
other related benefits pursuant to the Celanese International
Long-Term Assignment Agreement (“CILA Agreement”)
to be entered into between the Company and Executive.
On July 25,
2007, the Company granted Executive 120,000 non-qualified
stock options (the “NQSO Grant”) at the fair
market value on the date of grant. Executive and the Company
shall enter into a Nonqualified Stock Option Agreement which
will set forth the terms of the NQSO Grant, including that a
percentage of the NQSO
Grant will vest on
each of the following dates in accordance with the following
schedule:
January 1, 2009:
10%
January 1, 2010:
30%
January 1, 2011:
30%
January 1, 2012:
30%
6. Business
Expenses. During the Employment Term, reasonable business
expenses incurred by Executive in the performance of
Executive’s duties hereunder shall be reimbursed by the
Company in accordance with Company policies and the CILA
Agreement.
7. Termination.
The Employment Term and Executive’s employment hereunder
may be terminated by either party at any time for any reason;
provided that Executive will be required to give the Company
at least 30 days advance written notice of any
resignation of Executive’s employment. Notwithstanding
any other provision of this Agreement, the provisions of this
Section 7 shall exclusively govern Executive’s
rights upon termination of employment with the Company and its
affiliates; provided, however, that the terms and conditions
of the other written agreements between the Company and
Executive shall be followed insofar as they provide
supplemental rights or privileges with respect to equity or
deferred compensation.
a. By the
Company For Cause or By Executive Resignation Without Good
Reason.
(i) The
Employment Term and Executive’s employment hereunder may
be terminated by the Company for Cause (as defined below) and
shall terminate automatically upon Executive’s
resignation without Good Reason (as defined in
Section 7(c)).
(ii) For
purposes of this Agreement, “Cause” shall mean
(A) Executive’s willful failure to perform
Executive’s duties hereunder (other than as a result of
total or partial incapacity due to physical or mental illness)
for a period of 30 days following written notice by the
Company to Executive of such failure, (B) conviction of,
or a plea of nolo contendere to, (x) a felony (other than
traffic-related) under the laws of the United States or any
state thereof or any similar criminal act in a jurisdiction
outside the United States or (y) a crime involving moral
turpitude, (C) Executive’s willful malfeasance or
willful misconduct which is demonstrably injurious to the
Company, (D) any act of fraud by Executive or
(E) Executive’s breach of the provisions of
Sections 8 or 9 of this agreement.
(iii) If
Executive’s employment is terminated by the Company for
Cause, or if Executive resigns without Good Reason, Executive
shall be entitled to receive:
(A) the Base
Salary through the date of termination;
(B) any Annual
Bonus earned but unpaid as of the date of termination for any
previously completed fiscal year;
(C) reimbursement for any unreimbursed business expenses
properly incurred by Executive in accordance with Company
policy and CILA Agreement prior to the date of
Executive’s termination; and
(D) such
Employee Benefits, if any, as to which Executive may be
entitled under the employee benefit plans of the Company or
its affiliates (the amounts described in clauses (A)
through (D) hereof being referred to as the
“Accrued Rights”).
Following such
termination of Executive’s employment by the Company for
Cause or resignation by Executive without Good Reason, except
as set forth in this Section (a)(iii), Executive shall have no
further rights to any compensation or any other benefits under
this Agreement.
b. Disability or
Death.
(i) The
Employment Term and Executive’s employment hereunder
shall terminate upon Executive’s death and may be
terminated by the Company if Executive becomes physically or
mentally incapacitated and is therefore unable for a period of
six (6) consecutive months or for an aggregate of nine
(9) months in any twenty-four (24) consecutive month
period to perform Executive’s duties (such incapacity is
hereinafter referred to as “Disability”).
(ii) Upon
termination of Executive’s employment hereunder for
either Disability or death, Executive or Executive’s
estate (as the case may be) shall be entitled to receive the
Accrued Rights. Following Executive’s
termination of
employment due to death or Disability, except as set forth in
this Section 7(b)(ii), Executive shall have no further
rights to any compensation or any other benefits under this
Agreement.
c. By the
Company Without Cause or Resignation by Executive for Good
Reason.
(i) The
Employment Term and Executive’s employment hereunder may
be terminated by the Company without Cause or by
Executive’s resignation for Good Reason; provided,
however, that Non-Renewal of this Agreement shall be treated
as a termination of employment during the Employment Term
without Cause except in the event of (a) Cause; or
(b) Executive’s rejection of the offer of continued
employment on terms and conditions not materially less
advantageous to Executive as those in effect immediately prior
to the Non-Renewal of this Agreement (a “Non-Renewal
without Cause”). In addition, a Non-Renewal without
Cause shall be treated as a Good Termination for purposes of
the Company’s Deferred Compensation Plan, 2004 Stock
Incentive Plan or any other plans or programs of the Company
that employs a Good Termination definition or employs any
comparable concept.
(ii) For
purposes of this Agreement, “Good Reason” shall
mean (A) any reduction in Executive’s Base Salary
or Annual Bonus opportunity or (B) any substantial
diminution in Executive’s position or duties, adverse
change in reporting lines or assignment of duties materially
inconsistent with Executive’s position (other than in
connection with an increase in responsibility or a promotion);
provided that the events described in clauses (A) or
(B) of this Section 7(c)(ii) shall constitute Good
Reason only if the Company fails to cure such event within
30 days after receipt from Executive of written notice of
the event which constitutes Good Reason.
(iii) If
Executive’s employment is terminated by the Company
without Cause (other than by reason of death or Disability) or
if Executive resigns for Good Reason, Executive shall be
entitled to receive:
(A) the Accrued
Rights;
(B) a pro rata
portion of any Annual Bonus, if any, that Executive would have
been entitled to receive pursuant to Section 4 hereof in
such year based upon the percentage of the fiscal year that
shall have elapsed through the date of Executive’s
termination of employment, payable when such Annual Bonus
would have otherwise been payable had Executive’s
employment not terminated, and
(C) subject to
Executive’s continued compliance with the provisions of
Sections 8 and 9, (x) continued payment of the Base
Salary until twelve months after the date of such termination
and (y) payment of Executive’s Target Annual Bonus
for the year of termination, payable over the twelve month
period after the date of such termination, in accordance with
the Company’s usual payroll practice; provided that the
aggregate amount described in this clause (C) shall be
reduced by the present value of any other cash severance or
termination benefits payable to Executive under any other
plans, programs or arrangements of the Company or its
affiliates.
Following
Executive’s termination of employment by the Company
without Cause (other than by reason of Executive’s death
or Disability) or by Executive’s resignation for Good
Reason, except as set forth in this Section 7(c)(iii),
Executive shall have no further rights to any compensation or
any other benefits under this Agreement.
d. Continued
Employment Beyond the Expiration of the Employment Term.
Unless the parties otherwise agree in writing, continuation of
Executive’s employment with the Company beyond the
expiration of the Employment Term shall be deemed an
employment at-will and shall not be deemed to extend any of
the provisions of this Agreement and Executive’s
employment may thereafter be terminated at will by either
Executive or the Company; provided that the provisions of
Sections 8, 9 and 10 of this Agreement shall
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