<PAGE>
Exhibit 10.1
EMPLOYMENT AND SEVERANCE AGREEMENT
This
Employment and Severance Agreement (the "Agreement") is entered
into
this 5th day of August, 2005, by and
between AGCO CORPORATION, a Delaware
corporation (the "Company"), and Hubertus
Muhlhauser (the "Executive").
WITNESSETH:
In
consideration of the mutual covenants and agreements hereinafter
set
forth, the Company and the Executive do
hereby agree as follows:
1.
EMPLOYMENT.
(a) The Company hereby employs the Executive, and the Executive
hereby agrees to serve the Company, upon
the terms and conditions set forth in
this Agreement.
(b) The employment term shall commence on September 1, 2005,
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 468,000
Swiss Francs (EUR 300,000 converted to
Swiss Francs using the exchange rate on the
date this contract is signed. No
adjustments will be made in future for any
movement in exchange rates) 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. The Base Salary and
annual bonus will be paid through a Swiss
payroll provider in Swiss francs.
(b) INCENTIVE COMPENSATION. Provided Executive has duly
performed
his obligations pursuant to this Agreement,
the Executive shall be entitled to
an annual bonus to
- 1 -
<PAGE>
be paid upon the Executive achieving
pre-agreed targets which will be annually
reviewed and participate in the Long-Term
Incentive Plan that is implemented by
the Company.
(c) PENSION. The Company will contribute 50 percent of the cost
of
providing retirement benefits in
Switzerland. Pension contributions will be
calculated on base salary only, not other
remuneration, e.g., Incentive
Compensation. Full details of the scheme
will be forwarded when arrangements are
completed with the insurance broker. The
Company will make the required
contributions to the Swiss social security
system. You will be responsible for
the employee portion.
(d) HEALTH INSURANCE. The Company will provide a health
insurance
package of benefits similar to those
provided by your previous employer.
(e) OTHER BENEFITS. The Company will pay for sickness and
accident
insurance in Switzerland. Full details will
be forwarded to you when they have
been arranged by the insurance broker.
(f) FRINGE BENEFITS. The Company shall pay or reimburse the
Executive 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 reasonably
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 all expenses for
fuel, maintenance and insurance in
connection with such use of the automobile.
Executive shall also be entitled to
use the vehicle for private purposes. 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, 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
- 2 -
<PAGE>
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) DEFINTIONS.
(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. Except where generally known outside the
Company 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 used by the Company; (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
- 3 -
<PAGE>
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
twelve (12) months following the
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
twelve (12) 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 twelve
(12) 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
twelve (12) 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
regist
