EXHIBIT 10.12
EMPLOYMENT AGREEMENT
KEITH A. WILSON
EMPLOYMENT AGREEMENT (the "Agreement") dated July 21, 2005
by and
between Affinia Group Inc. (the "Company") and Keith A. Wilson (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 Vice President and General Manager, Under Hood 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 $300,000, 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 Gastonia, North Carolina, 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 d
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