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Exhibit 10.2
VISTEON HOURLY EMPLOYEE LEASE AGREEMENT
This Lease
Agreement (the "AGREEMENT") is made effective as of October 1,
2005 (the "EFFECTIVE DATE"), between
Visteon Corporation, a Delaware corporation
("VISTEON"), and Automotive Components
Holdings, LLC f/k/a/ VFH Holdings, LLC, a
Delaware limited liability company ("ACH").
ACH and Visteon are referred to
herein individually as a "PARTY" and
collectively as the "PARTIES".
RECITALS
WHEREAS, ACH is
engaged in the business of manufacturing and assembling
automotive parts and providing related
services ("BUSINESS");
WHEREAS, ACH is
an entity managed by Ford Motor Company, a Delaware
corporation ("FORD");
WHEREAS, ACH and
Ford will attempt to disposition certain assets of the
Business to subsequent buyers;
WHEREAS, Visteon
hourly employees are represented by the International
Union, United Automobile, Aerospace and
Agricultural Implement Workers of
America, UAW and its affiliated locals
(collectively, "UAW") and are covered
under the terms and conditions of the (i)
Master Visteon-UAW Collective
Bargaining Agreement dated June 29, 2000
and the Supplemental Agreement dated as
of May 4, 2004 and extensions or successor
agreements by and between Visteon and
the UAW (collectively, "MASTER VISTEON
CBA") or (ii) the UAW Local #1216-Visteon
Corporation Regional Assembly and
Manufacturing LLC, Bellevue Plant, Labor
Agreement ("BELLEVUE CBA") such employees
hereafter known as ("BELLEVUE HOURLY
EMPLOYEES");
WHEREAS,
pursuant to the terms of a Memorandum of Agreement dated as of
May
24, 2005 by and between the UAW, Ford and
Visteon ("MOA") the parties thereto
agreed that all Visteon employees
represented under the Master Visteon CBA as of
the Effective Date would be converted to
Ford employees and that after the
Effective Date, Visteon would hire any new
hourly employees under the terms of
the Master Visteon CBA and lease them to
ACH ("VISTEON NEW HIRES");
WHEREAS, ACH
desires to obtain the services of Visteon New Hires to conduct
the Business pursuant to the terms of this
Agreement; and
WHEREAS, ACH
desires to obtain the services of Bellevue Hourly Employees to
conduct the Business pursuant to the terms
of this Agreement.
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NOW THEREFORE,
in consideration of the above premises and the mutual
covenants herein contained, and for other
good and valuable consideration given
by each Party hereto to the other, the
sufficiency and receipt of which are
hereby acknowledged, the Parties hereto,
intending to be legally bound, hereby
agree as follows:
ARTICLE 1
TERM
Section 1.01.
Term. The term of this Agreement shall commence on October 1,
2005, such date being referred to hereafter
as the "EFFECTIVE DATE" and shall
terminate on the earlier to occur of (i)
the termination of employment of all of
the Leased Employees (as defined below) or
(ii) the agreement of the Parties to
terminate this Agreement ("TERM").
ARTICLE 2
LEASE OF VISTEON HOURLY EMPLOYEES
Section 2.01.
Lease and Employee Census. A preliminary employee census is
attached as Schedule 2.01 ("PRELIMINARY
CENSUS"). The Preliminary Census sets
forth a list of the Bellevue Hourly
Employees to be leased to ACH as of the
Effective Date, together with their base
hourly wage rate, Visteon service date,
job classification, location code and
Global Identification Number. Within five
days of the date hereof, Visteon shall
update the Preliminary Census with any
applicable changes and deliver the
Preliminary Census to ACH. ACH shall have an
additional five days to approve the revised
Preliminary Census. After the
revised Preliminary Census is approved by
ACH, it shall be substituted for
Schedule 2.01 and shall be known as the
"EMPLOYEE Census". Employees who are
identified on the Employee Census shall be
known as "LEASED EMPLOYEES". In the
event that ACH requires additional hourly
employees to work in the Business, ACH
will inform Visteon of its personnel
requirements. Visteon shall hire only that
number of employees with the specified
skills that ACH requests. Visteon and ACH
shall agree on the hiring process to be
used. Visteon shall update the Employee
Census at least monthly for any Visteon New
Hires or Bellevue Hourly Employees
and other employee transactions (i.e.,
quits, death, transfers, etc.) in
connection with the invoice procedure
specified in Section 4.04. Bellevue Hourly
Employees and Visteon New Hires on the
Employee Census shall be known for
purposes of this Agreement as the "LEASED
EMPLOYEES". The period during which
Leased Employees are leased to ACH is
referred to as the "LEASE PERIOD". ACH
agrees to lease from Visteon, and Visteon
agrees to lease to ACH, the Leased
Employees under the terms of this
Agreement.
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Section 2.02.
Buyer Leasing. In the event of a sale or transfer of all or
any part of the Business to a buyer,
Visteon and Ford shall mutually agree on
any ultimate disposition of the Leased
Employees to a buyer, subject to UAW
consent. Visteon shall make any appropriate
arrangements concerning HR services
as is determined by ACH, Visteon and a
buyer for up to twenty-four (24) months
under the terms of the Master Services
Agreement between the Parties executed as
of even date herewith ("MASTER SERVICES
AGREEMENT"). Visteon shall provide such
HR services to a buyer at the following
rates:
<TABLE>
<CAPTION>
TERM
PRICE
----
-----
<S>
<C>
9 months post-sale
Cost + 5%
10-15 months post-sale Cost
+ 8%
16 months and beyond post-sale Cost + 12%
</TABLE>
Section 2.03.
Redundant Employees. ACH shall give Visteon at least ten
business days notice (where practical) when
ACH desires to discontinue the lease
of any individual Leased Employee or group
of Leased Employee, in its sole
discretion. The requirement for at least
ten business days notice will be waived
in situations when a Leased Employee
commits an offense which would justify a
"for cause" termination under Visteon's
personnel practices and consistent with
the applicable CBA, in which event such
employee will be terminated from this
Agreement immediately and returned to
Visteon. Visteon shall delete any such
employee from the Employee Census effective
on the last day worked for ACH;
provided however, that ACH shall remain
responsible for reimbursing Visteon for
only those costs Visteon may incur with
respect to such employee under the terms
of the applicable CBA, including SUB costs,
if any. Notwithstanding the above,
lease fees for any Leased Employee
terminated "for cause" shall cease the day
the termination is effective. Visteon shall
be responsible for complying with
any applicable Worker Adjustment and
Retraining Notification ("WARN") Act or
other applicable legal requirements in
connection with a termination of a Leased
Employee, provided that Visteon receives
notice from ACH sufficiently in advance
to permit such compliance, including
notification requirements. If Visteon does
not receive sufficient notice from ACH, ACH
shall be responsible for all costs
of such compliance with WARN or any similar
law, including costs of any period
of continued employment or pay in lieu of
notice.
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ARTICLE 3
EMPLOYER MATTERS
Section 3.01.
Employer Definition. Visteon shall be the employer of the
Leased Employees and ACH shall not be
considered the employer. Visteon will
instruct Leased Employees to (i) conform to
applicable law and ACH policies
while at ACH facilities regarding safety
and health, personal and professional
conduct (including the wearing of an
identification badge or personal protective
equipment and adhering to plant regulations
and general safety practices or
procedures) generally applicable to such
facilities, which policies, procedures,
rules and regulations ACH will provide as
soon as practicable after the date
hereof, and as soon as practicable upon any
modification, termination or
adoption of any such policy, procedure,
rule or regulation; and (ii) to
otherwise conduct themselves in a lawful
and businesslike manner. Leased
Employees also shall be subject at all
times to ACH's and Visteon's policies and
procedures. During the Lease Period,
Visteon shall retain responsibility for all
payments and benefits due to the Leased
Employees in connection with their work
relating to the Business and pro-rated for
part-time employment, including but
not limited to:
(i) the payment
of Leased Employees' base hourly wage or other components
of pay as required under the applicable CBA
(less any applicable withholding or
other taxes or any amounts deducted from
such wages pursuant to normal payroll
practices of Visteon);
(ii) the
provision of all other employee benefits under the applicable
CBA;
(iii) payment of
all federal, state, or local taxes withheld or otherwise
required to be paid with respect thereto;
and
(iv) the
liability for statutory benefits, including workers'
compensation,
payable to employees.
Section 3.02.
Management of Employees. ACH and its management shall have
the right to assign to, and to structure
work for, the Leased Employees in
accordance with the terms of the applicable
CBA. Visteon acknowledges that ACH
will have no employees, but ACH will carry
out its management responsibilities
hereunder by retaining appropriate
personnel by assignment from Ford, leasing
salaried employees from Visteon or
retaining agency employees either by itself
or through Visteon.
Section 3.03.
Information. ACH shall provide Visteon on a weekly basis a
summary of the hours of service rendered by
each of the Leased Employees during
the preceding week. In addition, ACH shall
provide Visteon with such information
or documents as Visteon may reasonably
request with respect to a
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Leased Employee. ACH will share any such
information with Visteon (other than
non-job related personal care received by
the Leased Employees unless related to
a legitimate business interest of Visteon)
regardless of any claim of privilege
or confidentiality because Visteon is an
employer of the Leased Employees.
Section 3.04.
Payroll and Related Services. During the Lease Period,
Visteon shall provide payroll processing
services for the Leased Employees
comparable to such services for its
employees other than Leased Employees. Upon
reasonable request or as needed, Visteon
will provide assurances that all proper
payments and reporting requirements have
been made.
Section 3.05.
Employee Benefit Plans. (a) During the Lease Period, Visteon
shall cover the Leased Employees under the
employee benefit and fringe benefit
plans and arrangements under the applicable
CBA. Leased Employees shall be
ineligible to participate in any employee
benefit plan or fringe benefit program
sponsored by ACH or Ford. Requests for
leave, reasonable accommodation and other
benefits provided by Visteon policies or by
federal, state or local law will be
coordinated by ACH and Visteon. For
avoidance of doubt, during the Lease Period,
Visteon reserves the right to modify,
terminate or suspend any employee benefit
or fringe benefit plan applicable to any of
the Leased Employees, with ACH
consent, and subject to the applicable
CBA.
(b) During the
Lease Period, Visteon shall maintain, administer and manage
all employee benefit and fringe benefit
plans and arrangements offered to the
Leased Employees.
ARTICLE 4
REIMBURSEMENT
Section 4.01.
Direct Wage and Benefit Costs. Visteon shall be reimbursed
for the direct wage and benefit costs for
the Leased Employees. For purposes of
this Section 4.01, reimbursements for
"direct wage and benefit costs" shall
include:
(i) The weekly
gross wage, and any other type of cash compensation
specified in the applicable CBA, such as
the Christmas bonus, moving allowance,
and any other cash compensation not
included in the Standard Monthly Group
Fringe Cost (as defined below);
(ii) A
per-employee Standard Monthly Group Fringe Cost according to
the
rate schedules set forth on Schedule
4.01(ii) attached hereto. The rate schedule
shall be reviewed monthly by ACH. Visteon
may change the rate schedule
periodically to reflect changes in costs
and plan benefits, but no more than
four
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times per any calendar year commencing in
2006,
