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Exhibit
10.80
MBIA INC.
KEY EMPLOYEE EMPLOYMENT
PROTECTION PLAN
1. Purpose . The purpose of the
MBIA Inc. Key Employee Employment Protection Plan (the
“Plan”) is to assure MBIA Inc. of the services of key
executives during any change in ownership or control of the Company
and to provide such executives certain financial assurances to
enable them to perform the responsibilities of their positions
without undue distraction and to exercise their judgment without
bias due to personal circumstances. This Plan is intended to be,
and shall be administered as, an employee welfare benefit plan as
defined in Section 3(1) of ERISA.
2. Definitions .
(a) “Agreement”
means the Key Employee Employment Protection Agreement between the
Participant and the Company whereby Participant agrees to be bound
by the covenants described in Section 12 of the
Plan.
(b) “Board” means
the Board of Directors of the Company.
(c) “Cause” means
(i) the willful failure by the Participant to perform
substantially his duties under Section 3 of the Agreement
(other than due to physical or mental illness) after reasonable
notice to the Participant of such failure, (ii) the
Participant’s engaging in serious misconduct that is
injurious to the Company or any subsidiary of the Company in any
way, including, but not limited to, by way of damage to their
respective reputations or standings in their respective industries,
(iii) the Participant’s having been convicted of, or
entered a plea of nolo contendere to, a crime that constitutes a
felony or (iv) the breach by the Participant of any written
covenant or agreement with the Company or any subsidiary of the
Company not to disclose or misuse any information pertaining to, or
misuse any property of, the Company or any subsidiary of the
Company or not to compete or interfere with the Company or any
subsidiary of the Company.
(d) “Change of
Control” means:
(i) any person (within the
meaning of Section 3(a)(9) of the Securities Exchange Act of
1934, as amended (the “ Exchange Act ”)),
including any group (within the meaning of Rule 13d-5(b) under
the Exchange Act), but excluding any of the Company, any subsidiary
of the Company or any employee benefit plan sponsored or maintained
by the Company or any subsidiary of the Company, acquires
“beneficial ownership” (within the meaning of
Rule 13d-3 under the
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Exchange Act), directly or
indirectly, of securities of the Company representing 25% or more
of the combined Voting Power of the Company’s Voting
Securities; or
(ii) within any 24-month
period, the persons who were directors of the Company at the
beginning of such period (the “ Incumbent Directors
”) shall cease to constitute at least a majority of the Board
or the board of directors of any successor to the Company;
provided, however, that any director elected to the Board, or
nominated for election, by a majority of the Incumbent Directors
then still in office (other than in compromise of a proxy contest
or to avoid such contest) shall be deemed to be an Incumbent
Director for purposes of this subclause (ii); or
(iii) upon the consummation
of a merger, consolidation, share exchange, division, sale or other
disposition of all or substantially all of the assets of the
Company which has been approved by the shareholders of the Company
(a “ Corporate Event ”), and immediately
following the consummation of which the stockholders of the Company
immediately prior to such Corporate Event do not hold, directly or
indirectly, a majority of the Voting Power in ( x ) in
the case of a merger or consolidation, the surviving or resulting
corporation, ( y ) in the case of a share exchange, the
acquiring corporation or ( z ) in the case of a
division or a sale or other disposition of assets, each surviving,
resulting or acquiring corporation which, immediately following the
relevant Corporate Event, holds more than 25% of the consolidated
assets of the Company immediately prior to such Corporate
Event.
(e) “Change of Control
Date” means the date on which the Change of Control is deemed
to occur.
(f) “Committee”
means the Compensation & Organization Committee of the
Board or such other committee of the Board as the Board shall
designate from time to time; provided that, in respect of
any period after any Change of Control Date, the Committee shall
mean the Committee as in office and as constituted immediately
prior to the Change of Control.
(g) “Company”
means MBIA Inc., a Connecticut corporation, and any successor
thereto.
(h) “Date of
Termination” means (i) in the case of a termination for
which a Notice of Termination is required, the date of receipt of
such Notice of Termination or, if later, the date specified
therein, as the case may be, and (ii) in all other cases, the
actual date on which a Participant’s employment terminates
during the Employment Period.
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(i) “Disability”
means the Participant has met the conditions to qualify for
long-term disability benefits under the Company’s policies,
as in effect immediately prior to the Change of Control
Date.
(j) “Effective
Date” means the date on which the Agreement becomes
effective.
(k) “Employee”
means any employee or officer of the Company.
(l) “Employment
Period” has the meaning specified in Section 4
hereof.
(m) “Good Reason”
means the occurrence of any of the following, without the express
written consent of the affected Participant, after the occurrence
of a Change of Control:
(i) the assignment to the
Participant of any duties inconsistent in any material adverse
respect with the Participant’s position, authority or
responsibilities as contemplated by Section 5 of this Plan, or
any other material adverse change in such position, including
titles, authority or responsibilities;
(ii) any failure by the
Company to comply with any of the provisions of Section 6 of
this Plan, other than an insubstantial or inadvertent failure
remedied by the Company promptly after receipt of notice thereof
given by the Participant;
(iii) the Company’s
requiring the Participant to be based at any office or location
more than 50 miles (or such other distance as shall be set forth in
the Company’s relocation policy as in effect at the Effective
Time) from ( x ) that location at which he performed
his services immediately prior to the Change of Control and (
y ) the Participant’s residence immediately prior
to the Change of Control, except for travel reasonably required in
the performance of the Participant’s responsibilities;
or
(iv) any failure by the
Company to obtain the assumption and agreement to perform this
Agreement by a successor as contemplated by
Section 13(b).
With respect to the person or persons
serving as the Chief Executive Officer of the Company at the time
of a Change of Control, and to any other Participant that the
Committee shall designate, the definition of Good Reason shall also
include the Participant’s voluntary termination of employment
at any time during the 30-day period commencing on the first
anniversary of the date on which a Change of Control
occurs.
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(n) “Governing
Documents” means the Company’s Certificate of
Incorporation and By-Laws.
(o) “Notice of
Termination” means a written notice of a Participant’s
termination of employment which (i) indicates the specific
termination provision in this Plan relied upon, (ii) sets
forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of the Participant’s
employment under the provision so indicated, and (iii) if the
termination date is other than the date of receipt of such notice,
specifies the termination date of the Agreement (which date shall
be not more than 15 days after the giving of such
notice).
(p) “Participant”
means an Employee who is designated to participate in the Plan
pursuant to Section 3 of the Plan.
(q)
“Performance-Vesting Restricted Stock” means awards of
restricted stock of MBIA Inc. which vests based on achievement of
predetermined performance goals.
(r) “Potential Change
of Control” means:
(i) a Person commences a
tender offer (with adequate financing) for securities representing
at least 15% of the Voting Power of the Company’s
securities;
(ii) the Company enters into
an agreement the consummation of which would constitute a Change of
Control;
(iii) proxies for the
election of directors of the Company are solicited by anyone other
than the Company; or
(iv) any other event occurs
which is deemed to be a Potential Change of Control by the Board.
Notwithstanding the foregoing, if, after a Potential Change of
Control and before a Change of Control, the Board makes a good
faith determination that such Potential Change of Control will not
result in a Change of Control, the Board may nullify the effect of
the Potential Change of Control (a "Nullification") by resolution
(a "Nullification Resolution"), in which case the Participant shall
have no further rights and obligations under this Agreement by
reason of such Potential Change of Control; provided, however, that
if the Participant shall have delivered a Notice of Termination
prior to the date of the Nullification Resolution, such Resolution
shall not effect the Participant’s rights
hereunder.
(s) “Time-Vesting
Restricted Stock” means awards of restricted stock of MBIA
Inc. which vests based solely on the passage of time.
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(t) “Voting
Power” means such number of the Voting Securities as shall
enable the holders thereof to cast such percentage of all the votes
which could be cast in an annual election of directors.
(u) “Voting
Securities” means all securities of a company entitling the
holders thereof to vote in an annual election of
directors.
3. Eligibility . Each Employee of
the Company who is a direct report of the Chief Executive Officer
whom he or she designates as a member of senior management of the
Company and who is approved by the Committee and each other
Employee as the Committee may from time to time designate as a
Participant, shall participate in the Plan.
4. Employment Period . Subject to
Section 7 of this Plan, the Company agrees to continue the
Participant in its employ for the period (the “Employment
Period”) commencing on the Change of Control Date and ending
on the second anniversary of the Change of Control Date.
5. Position and Duties
.
(a) No Reduction in
Position . During the Employment Period, a Participant’s
position (including titles), authority and responsibilities shall
be at least commensurate with those held, exercised and assigned to
the Participant immediately prior to the Change of Control Date. It
is understood that, for purposes of this Plan, such position,
authority and responsibilities shall not be regarded as not
commensurate merely by virtue of the fact that a successor shall
have acquired all or substantially all of the business and/or
assets of the Company as contemplated by Section 13(b) of this
Plan. A Participant’s services shall be performed at the
location where the Participant was employed immediately preceding
the Change of Control Date.
(b) Business Time .
From and after the Effective Date, a Participant shall devote his
full attention during normal business hours to the business and
affairs of the Company and shall use his best efforts to perform
faithfully and efficiently the responsibilities assigned to him
hereunder, to the extent necessary to discharge such
responsibilities, except for (i) time spent in managing his
personal, financial and legal affairs and serving on corporate,
civic or charitable boards or committees, in each case only if and
to the extent not substantially interfering with the performance of
such responsibilities, and (ii) periods of vacation and sick
leave to which he is entitled. It is expressly understood and
agreed that a Participant’s continuing to serve on any boards
and committees on which he is serving or with which he is otherwise
associated immediately preceding the Change of Control Date shall
not be deemed to interfere with the performance of the
Participant’s services to the Company.
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6. Compensation .
(a) Base Salary .
During the Employment Period, a Participant shall receive a base
salary at a monthly rate at least equal to the monthly salary paid
to the Participant by the Company and any of its affiliated
companies immediately prior to the Change of Control Date. The base
salary shall be reviewed at least once each year after the Change
of Control Date, and may be increased (but not decreased) at any
time and from time to time by action of the Board or any committee
thereof or any individual having authority to take such action in
accordance with the Company’s regular practices. The
Participant’s base salary, as it may be increased from time
to time, shall hereafter be referred to as “Base
Salary”. Neither the Base Salary nor any increase in Base
Salary after the Change of Control Date shall serve to limit or
reduce any other obligation of the Company hereunder.
(b) Annual Bonus .
During the Employment Period, in addition to the Base Salary, for
each fiscal year of the Company ending during the Employment
Period, each Participant shall be afforded the opportunity to
receive an annual bonus on terms and conditions no less favorable
to the Participant (taking into account reasonable changes in the
Company’s goals and objectives and taking into account actual
performance) than the annual bonus opportunity that had been made
available to the Participant for the fiscal year ended immediately
prior to the Change of Control Date (the “Annual Bonus
Opportunity”). Any amount payable in respect of the Annual
Bonus Opportunity shall be paid as soon as practicable following
the year for which the amount is earned or awarded, unless
electively deferred by the Participant pursuant to any deferral
programs or arrangements that the Company may make available to the
Participant.
(c) Long-term Incentive
Compensation Programs . During the Employment Period, each
Participant shall participate in all long-term incentive
compensation programs for key executives at a level that is
commensurate with the Participant’s participation in such
plans immediately prior to the Change of Control Date, or, if more
favorable to the Participant, at the level made available to the
Participant or other similarly situated officers at any time
thereafter.
(d) Benefit Plans .
During the Employment Period, each Participant (and, to the extent
applicable, his dependents) shall be entitled to participate in or
be covered under all pension, retirement, deferred compensation,
savings, medical, dental, health, disability, group life and
accidental death insurance plans and programs of the Company and
its affiliated companies at a level that is commensurate with the
Participant’s participation in such plans immediately prior
to the Change of Control Date, or, if more favorable to the
Participant, at the level made available to the Participant or
other similarly situated officers at any time thereafter;
provided that, in the event of an across the board change in
the level of benefits available to all employees, each Participant
shall be entitled to participate at the level made available to
other similarly situated officers after giving effect to such
change.
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(e) Expenses . During
the Employment Period, each Participant shall be entitled to
receive prompt reimbursement for all reasonable expenses incurred
by the Participant in accordance with the policies and procedures
of the Company as in effect immediately prior to the Change of
Control Date. Notwithstanding the foregoing, the Company may apply
the policies and procedures in effect after the Change of Control
Date to the Participant, if such policies and procedures are not
less favorable to the Participant than those in effect immediately
prior to the Change of Control Date.
(f) Vacation and Fringe
Benefits . During the Employment Period, each Participant shall
be entitled to paid vacation and fringe benefits at a level that is
commensurate with the paid vacation and fringe benefits available
to the Participant immediately prior to the Change of Control Date,
or, if more favorable to the Participant, at the level made
available from time to time to the Participant or other similarly
situated officers at any time thereafter.
(g) Indemnification .
During and after the Employment Period, the Company shall indemnify
each Participant and hold each such Participant harmless from and
against any claim, loss or cause of action arising from or out of
the Participant’s performance as an officer, director or
employee of the Company or any of its Subsidiaries or in any other
capacity, including any fiduciary capacity, in which the
Participant serves at the request of the Company to the maximum
extent permitted by applicable law and the Company’s
Governing Documents, provided that in no event shall the protection
afforded to the Participant under the Plan be less than that
afforded under the Governing Documents as in effect immediately
prior to the Change of Control Date, except to the extent that any
such claim, loss, or cause of action resulted from such
Participant’s bad faith, gross negligence or willful
misconduct.
(h) Office and Support
Staff . Each Participant shall be entitled to an office with
furnishings and other appointments during the employment period,
and to secretarial and other assistance, at a level that is at
least commensurate with the foregoing provided to other similarly
situated officers.
7. Termination .
(a) Death, Disability or
Retirement . A Participant’s participation in this Plan
shall terminate automatically upon such Participant’s death,
termination due to Disability or voluntary retirement under any of
the Company’s retirement plans as in effect from time to
time.
(b) Voluntary
Termination . Notwithstanding anything in this Plan to the
contrary, following a Change of Control a Participant may, upon not
less than 60 days’ written notice to the Company, voluntarily
terminate employment for any reason (including early retirement
under the terms of any of the Company’s retirement plans as
in effect from time to time), provided that any termination by a
Participant pursuant to
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Section 7(d) on account of Good
Reason shall not be treated as a voluntary termination under this
Section 7(b).
(c) Cause . The
Company may terminate the Participant’s employment for Cause.
Any termination by the Company for Cause shall be communicated by
Notice of Termination to the Participant in accordance with
Section 14(h).
(d) Good Reason .
Following the occurrence of a Change of Control, the Participant
may terminate his employment for Good Reason. In no event shall the
mere occurrence of a Change of Control, absent any further impact
on a Participant, be deemed to constitute Good Reason. Any
termination by a Participant for Good Reason shall be communicated
by Notice of Termination to the Company in accordance with
Section 14(h) within 90 days of the Participant’s having
actual knowledge of the events giving rise to such termination. The
failure by a Participant to set forth in the Notice of Termination
any fact or circumstance which contributes to a showing of Good
Reason shall not waive any right of the Participant hereunder or
preclude the Participant from asserting such fact or circumstance
in enforcing his rights hereunder.
8. Obligations of the Company upon
Termination.
(a) Death or
Disability . If a ParticipantR
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