EXHIBIT 10.13
EMPLOYMENT AGREEMENT
JOHN R. WASHBISH
EMPLOYMENT AGREEMENT (the "Agreement") dated July
21, 2005 by
and between Affinia Group Inc. (the "Company") and John R. Washbish
(the
"Executive").
The Company desires to continue to employ
Executive and to
enter into an agreement embodying the terms of such employment;
Executive desires to continue to be employed by
the Company
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 on
May 1, 2005 and ending on December 31, 2007 (the "Employment Term")
on the terms
and subject to the conditions set forth in this Agreement;
provided, however,
that commencing with December 31, 2007 and on each December 31
thereafter (each
an "Extension Date"), the Employment Term shall automatically be
extended for an
additional one year period, unless the Company or Executive
provides the other
party hereto 90 days prior written notice before the next Extension
Date that
the Employment Term shall not be so extended.
2. Position.
a. During the Employment Term, Executive shall serve as
the Company's
President, Customer Relationship Management and Vice President and
General
Manager, Under Vehicle Group. 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. If
requested, Executive shall also serve as a member of the Board
without
additional compensation.
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, 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; 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 $426,000, payable in regular
installments in
accordance with the Company's usual payment practices. Executive
shall be
entitled to such
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increases 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 fiscal year during
the
Employment Term, Executive shall be eligible to earn an annual
bonus award (an
"Annual Bonus") of one hundred percent (100%) of Executive's Base
Salary (the
"Target Annual Bonus") upon the achievement of performance goals
established by
the Board. Executive may be entitled to greater Annual Bonus for
performance in
excess targeted performance goals or a lesser Annual Bonus for
performance which
does not meet such targeted performance goals, in each case in the
discretion of
the Board.
5. Employee Benefits. During the Employment Term, Executive
shall generally
be entitled to participate in the Company's employee benefit plans
(other than
any severance plan) 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.
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.
7. Termination. The Employment Term and Executive's employment
hereunder
may be terminated by either party at any time and 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.
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) the
Executive's continued failure to perform such Executive's duties
(other than as
a result of total or partial incapacity due to physical or mental
illness) which
is not cured for a period of 10 days following written notice by
the Company or
its affiliates to the Executive of such failure, (B) conviction or
plea of
guilty or no contest to a (x) felony, or (y) crime involving moral
turpitude or
the property or business of the Company or its affiliates, (C)
willful
malfeasance or willful misconduct in performance of duties to the
Company or its
affiliates, or (D) 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;
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(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 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 (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 7(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:
(A) the Accrued Rights; and
(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.
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.
(ii) For purposes of this Agreement, "Good Reason" shall
mean (A) the
failure of the Company to pay or cause to be paid Executive's Base
Salary or
Annual Bonus, when due hereunder or a reduction in the Base Salary
or Target
Annual Bonus from the levels set
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forth in Sections 3 and 4, respectively (other than any across the
board
reduction in Base Salary and/or Annual Bonus of 15% or less which
similarly
affects the four other highest paid executive officers of the
Company as of the
date hereof, to the extent they are then employed by the Company)
(B) any
substantial and sustained diminution in Executive's title,
authority or
responsibilities from those described in Section 2 hereof or (C)
any relocation
of Executive's principal place of employment by more than 50 miles
from the
Company's current offices in Ann Arbor, Michigan or McHenry,
Illinois, without
Executive's consent; provided that either of the events described
in clauses (A)
and (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;
provided, further,
that "Good Reason" shall cease to exist for an event on the 60th
day following
the later of its occurrence or Executive's knowledge thereof,
unless Executive
has given the Company written notice thereof prior to such date.
(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) subject to Executive's continued compliance with
the
provisions of Sections 8 and 9, an amount equal to 2 times the
sum of (x)
Base Salary and the Average Bonus (as defined below) paid as
follows: (i)
the amount equal to 1 times the sum of Base Salary and the
Average Bonus
shall be paid in equal monthly installments for 12 months
following the
date of such termination of employment and (ii) the amount
equal to 1 times
the sum of Base Salary and the Average Bonus shall be paid on
the first
anniversary of the date of such termination of employment in a
lump sum
cash payment; provided that the aggregate amount described in
this clause
(B) 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. "Average
Bonus" shall
mean an amount equal to the average of the Annual Bonuses paid
to Executive
hereunder for the two most recently completed fiscal years
preceding
Executive's termination of employment (or if there has been
one, but less
than two completed fiscal years during the Employment Term, an
amount equal
to the average of the Annual Bonus hereunder for the preceding
completed
fiscal year and the annual bonus (excluding any special
non-recurring
bonuses or retention incentive payments) paid to Executive in
respect of
calendar year 2004 from Dana Corporation (including any
pro-rata annual
bonus paid to Executive by the Company for the part of 2004 in
which
Executive was employed by the Company) (the "2004 Annual
Bonus") or if
there have been no previously completed fiscal years during
the Employment
Term, then an amount equal to the 2004 Annual Bonus).
(C) 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
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(D) continued medical and dental coverage at the
Company's cost
(comparable to such coverage provided by the Company to active
executives
of the Company) for a period of 24 months after the date of
such
termination; provided that if the Company is unable to provide
such
coverage to Executive under the terms of its medical and
dental plans for
any portion of such period, the Company may in lieu of
providing such
coverage pay to Executive an amount equal to the premium that
would
otherwise be paid by active executives for such coverage
during such period
(without giving effect to any Company subsidy).
(iv) 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, in each case, within twenty-four months following a
Change of
Control (as defined in the Affinia Group Holdings Inc. 2005 Stock
Incentive
Plan), Executive shall be entitled to receive, in addition to the
payments and
benefits set forth in Section 7(c)(iii), a lump sum cash payment
equal to the
excess, if any, of (A) the product of (x) 2 times (y) the Target
Annual Bonus
over (B) the product of (x) 2 times (y) the Average Bonus.
For purposes of this Section 7(c), in the event such
termination of
employment occurs as a result of a resignation by Executive for
Good Reason due
to a reduction in Executive's Base Salary or Target Annual Bonus
pursuant to
Section 7(c)(ii)(A), the references to Base Salary and Target
Annual Bonus in
Sections 7(c)(iii) and 7(c)(iv) shall be deemed to be references to
Executive's
Base Salary and Target Bonus immediately before such reduction.
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), or Section 7(c)(iv) if applicable, Executive shall have
no further
rights to any compensation or any other benefits under this
Agreement.
d. Expiration of Employment Term.
(i) In the event either party elects not to extend the
Employment Term
pursuant to Section 1, unless Executive's employment is earlier
terminated
pursuant to paragraphs (a), (b) or (c) of this Section 7,
Executive's
termination of employment under this Agreement (whether or not
Executive
continues as an employee of the Company thereafter) shall be deemed
to occur on
the close of business on the day immediately preceding the next
scheduled
Extension Date and Executive shall be entitled to receive:
(A) if Executive is the party that elected not to
extend the
Employment Term, Executive shall be entitled to receive the
(x) Accrued
Rights and (y) commencing upon the date of Executive's
termination of
employment with the Company (which, for the avoidance of
doubt
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