SEVERANCE BENEFIT AGREEMENT
THIS SEVERANCE BENEFIT AGREEMENT (the "Agreement") made and entered into as
of the 1st day of August, 1994 (the "Effective Date"), by and between Ball
Corporation (the "Corporation") having its principal place of business located
at 345 South High Street, Muncie, Indiana, and (name) (the "Executive").
WHEREAS, the Corporation desires that the Executive continue as an employee
of the Corporation in accordance herewith;
WHEREAS, the parties desire to enter into this Agreement as of the
Effective Date, setting forth certain terms should the employment relationship
of the Executive terminate during the Term (as hereinafter defined).
NOW, THEREFORE, IN CONSIDERATION of the mutual premises, covenants and
agreements set forth below, it is hereby agreed as follows:
1. Term of Agreement. The term shall commence as of the Effective Date,
and shall continue until the third anniversary of the Effective Date (the
"Term"); provided, however, that commencing on the first anniversary of the
Effective Date, and on each anniversary thereafter (each, an "Anniversary
Date"), the Term of this Agreement shall be extended automatically for one
additional year unless the Corporation shall have given notice to the Executive
no later than sixty (60) days prior to such Anniversary Date of its intent to
terminate this Agreement at the end of two years following such Anniversary
Date.
2. Termination of Employment.
(a) Death or Disability. For purposes of this Agreement, the
Executive's employment shall terminate automatically upon the Executive's death
or "Disability" during the Term; provided however, this provision shall have no
effect on whether the Executive's employment has terminated for purposes of the
Corporation's long-term disability plan or program then in effect. For purposes
of this Agreement, the Executive's employment may be terminated by reason of
"Disability," if, as a result of the Executive's incapacity due to physical or
mental illness, the Executive shall have been absent from the full-time
performance of his duties with the Corporation for six (6) consecutive months,
and within thirty (30) days after written "Notice of Termination" (as defined in
subsection 2(d) hereof) is given, the Executive shall not have returned to the
full-time performance of his duties.
(b) By the Corporation for Cause. The Corporation may terminate the
Executive's employment during the Term for "Cause" or for reasons other than for
Cause. For purposes of this Agreement, "Cause" shall mean termination (i) upon
the willful and continued failure of the Executive to substantially perform his
duties with the Corporation (other than any such failure resulting from his
incapacity due to physical or mental illness or any such actual or anticipated
failure after the issuance of a Notice of Termination by the Executive or on
account of "Constructive Termination" (as defined in subsection 2(c) hereof)),
after a written demand for substantial performance is delivered to the Executive
by the Corporation, which demand specifically identifies the manner in which the
Board of Directors of the Corporation (the "Board") believes that the Executive
has not substantially performed his duties, or (ii) the willful engaging by the
Executive in conduct that is demonstrably and materially injurious to the
Corporation, monetarily or otherwise. For purposes of this subsection, no act,
or failure to act, on the Executive's part shall be deemed "willful" unless
done, or omitted to be done, by the Executive not in good faith and without
reasonable belief that such action or omission was in the best interest of the
Corporation.
(c) By the Executive for Constructive Termination. The Executive may
terminate his employment during the Term for "Constructive Termination." For
purposes of this Agreement, "Constructive Termination" shall mean, without the
Executive's express written consent, the occurrence of any of the following
circumstances, unless such circumstances are corrected prior to the "Date of
Termination" (as defined in subsection 2(e) hereof) specified in the Notice of
Termination given in respect thereof:
(i) a material adverse reduction or alteration (other than a
promotion or lateral position change) in the nature or status of the
Executive's position, duties or responsibilities or the conditions of the
Executive's employment as exist as of the Effective Date;
(ii) a reduction in the Executive's annual base salary ("Annual
Base Salary") or the failure of the Corporation to pay to the Executive any
portion or installment of deferred compensation under any deferred
compensation program of the Corporation within fourteen (14) days of the
date such compensation is due, except for across-the- board salary
reductions similarly affecting all similarly situated executives of the
Corporation;
(iii) the failure by the Corporation to continue in effect any
compensation or benefit plan in which the Executive participates as of the
Effective Date that is material to the Executive's total compensation,
unless an equitable arrangement (embodied in an ongoing substitute or
alternative plan) has been made with respect to such plan, or the failure
by the Corporation to continue the Executive's participation therein (or in
such substitute or alternative plan) on a basis not materially less
favorable, both in terms of the amount of benefits provided and the level
of the Executive's participation relative to other participants, as existed
as of the Effective Date, except for across-the-board benefit reductions
similarly affecting comparably situated executives of the Corporation;
(iv) the failure by the Corporation to continue to provide the
Executive with benefits substantially similar to those enjoyed by
comparably situated executives under any of the Corporation's life
insurance, medical, health and accident or disability plans in which the
Executive was participating as of the Effective Date, or the failure by the
Corporation to provide the Executive with the number of paid vacation days
to which the Executive is entitled on the basis of years of service with
the Corporation in accordance with the Corporation's normal vacation policy
in effect as of the Effective Date;
(v) the failure of the Corporation to continue this Agreement in
effect, or to obtain satisfactory agreement from any successor to assume
and agree to perform this Agreement, as contemplated by Section 6 hereof;
or
(vi) any material breach by the Corporation of any other material
provision of this Agreement.
In the event the Executive believes Constructive Termination exists, he shall,
in advance of delivery of any Notice of Termination, specify to the Corporation
in writing the circumstances alleged to constitute Constructive Termination, and
provide the Corporation with a reasonable period of time within which to cure
such circumstances.
(d) Notice of Termination. Any termination by the Corporation for
Cause, or by the Executive for Constructive Termination, shall be communicated
by Notice of Termination to the other party hereto given in accordance with this
Agreement. For purposes of this Agreement, a "Notice of Termination," means a
written notice that (i) indicates the specific termination provision in this
Agreement relied upon and (ii) to the extent applicable, sets forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Executive's employment under the provision so indicated. The
failure by the Executive or the Corporation to set forth in the Notice of
Termination any fact or circumstance that contributes to a showing of
Constructive Termination or Cause shall not waive any right of the Executive or
the Corporation hereunder or preclude the Executive or the Corporation from
asserting such fact or circumstance in enforcing the Executive's or the
Corporation's rights hereunder.
(e) Date of Termination. "Date of Termination" means (i) if the
Executive's employment is terminated by the Corporation for Cause, or by the
Executive for Constructive Termination, the date of receipt of the Notice of
Termination or any later date specified therein, as the case may be, (ii) if the
Executive's employment is terminated by the Corporation other than for Cause,
the Date of Termination shall be the date on which the Corporation notifies the
Executive of such termination, and (iii) if the Executive's employment is
terminated by reason of death or Disability, the Date of Termination shall be
the date of death or Disability (as the case may be).
(f) Notwithstanding subsection 3(a)(iii) hereof, upon the occurrence
of a "Change in Control," as defined in Section 2 of the severance agreement
(the "Severance Agreement") dated (date) between the Corporation and the
Executive, the Executive shall be entitled to the greater of [each of] the
benefit[s] otherwise provided herein, and [each of] the benefit[s] provided
under Section 5 of the Severance Agreement; provided, however, that the
provisions of Section 5(vi) of the Severance Agreement (regarding the
application of the cap relating to section 280G of the Internal Revenue Code of
1986, as amended) shall also be applied, if applicable, to any and all amounts
payable hereunder.
3. Obligations of the Corporation upon Termination.
(a) Certain Terminations. During the Term, if the Corporation shall
terminate the Executive's employment other than for Cause or if the Executive
shall terminate his employment for Constructive Termination, or if the
Executive's employment shall terminate by reason of death or Disability
(termination in any such case referred to as "Termination"), then even though
such Termination may result in the Executive taking retirement:
(i) the Corporation shall pay to the Executive a lump sum amount
in cash equal to the sum of (A) the Executive's Annual Base Salary through
the Date of Termination to the extent not theretofore paid, and (B) an
amount equal to the Executive's annual incentive compensation ("Annual
Incentive Compensation"), calculated in accordance with the provisions of
the Corporation's Economic Value Added Incentive Compensation Plan (the
"Incentive Compensation Plan"), or successor or other similar plan or plans
in effect from time to time, at target level, for the fiscal year that
includes the Date of Termination, multiplied by a fraction the numerator of
which shall be the number of days from the beginning of such fiscal year to
and including the Date of Termination and the denominator of which shall be
365. (The amounts specified in clauses (A) and (B) shall be hereinafter
referred to as the "Accrued Obligations".) The amounts specified in this
subsection 3(a)(i) shall be paid within thirty (30) days after the Date of
Termination; and
(ii) in the event of Termination by the Company other than for
Cause or by the Executive for Constructive Termination, then: (A) the
Company shall also pay to the Executive within thirty (30) days of such
Date of Termination a lump sum amount, in cash, equal to two (2) times the
sum of (x) the Executive's Annual Base Salary in effect immediately prior
to the Date of Termination, and (y) the Executive's Annual Incentive
Compensation, calculated based on the Target Incentive Percent, as defined
in the Incentive Compensation Plan, established for the Executive, for the
fiscal year in which the Date of Termination occurs; (B) the Corporation
shall also pay to the Executive the present value (discounted at an
interest rate equal to the prime rate promulgated by the First National
Bank of Chicago and in effect as of the date of payment, plus one percent
(the "Prime Rate")) of all benefits under the Corporation's Pension Plan
for Salaried Employees, or any successor plan thereto and any supplemental
executive retirement plans to which the Executive would have been entitled
had he remained in employment with the Corporation for an additional two
(2) years, each, where applicable, at the rate of Annual Base Salary, and
using the same assumptions and factors, in effect at the time Notice of
Termination is given, minus the present value (discounted at the Prime
Rate) of the benefits to which he is actually entitled under the
above-mentioned plans; (C) the Corporation shall continue, for a period of
two (2) years from the Date of Termination, medical and welfare benefits to
the Executive and/or the Executive's family at least equal to those that
would have been provided if the Executive's employment had not been
terminated, such benefits to be in accordance with the medical and welfare
benefit plans, practices, programs or policies (the "M&W Plans") of the
Corporation as in effect and applicable generally to other executives of
the Corporation and their families immediately preceding the Date of
Termination; provided, however, that if the Executive becomes employed with
another employer and is eligible to receive medical or other welfare
benefits under another employer-provided plan, the benefits under the M&W
Plans shall be reduced to the extent comparable benefits are actually
received by or made available to the Executive without cost during the two
(2) year period following the Executive's Date of Termination (and any such
benefits actually received by the Executive shall be reported to the
Corporation by the Executive) and (D) the Corporation shall, for purposes
of payout elections, treat balances under the Corporation's Deferred
Compensation Plans for executives under age 55 at time of Termination as if
the Executive were 55 years of age; and
(iii) Subject to subsection 2(f) hereof, the Corporation shall pay
or otherwise perform its obligations to the Executive under any benefit or
other then existing plan, policy, practice or program of the Corporation,
including those related to, but not limited to, individual outplacement
services in accordance with the general custom and practice generally
accorded to comparably situated executives, severance compensation,
vacation payments, stock options and deferred compensation, as well as
under any contract or agreement entered into before or after the date
hereof with the Corporation.
(b) Termination of the Executive for Cause or by the Executive Other
than for Constructive Termination. If the Executive's employment shall be
terminated for Cause during the Term, or if the Executive terminates employment
during the Term other than a termination for Constructive Termination, which he
shall not be prohibited from doing, the Corporation shall have no further
obligations to the Executive under this Agreement other than the obligation to
pay to the Executive the Accrued Obligations, plus any other earned but unpaid
compensation in each case to the extent not theretofore paid.
(c) Legal Expenses. The Corporation shall pay to the Executive such
reasonable legal fees and expenses incurred by the Executive in enforcing the
Executive's rights hereunder as a result of a Termination pursuant to subsection
3(a)(ii) hereof, but only with respect to such claim or claims upon which the
Executive substantially prevails. Such payments shall be made within fourteen
(14) business days after delivery of the Executive's written request for payment
accompanied with such evidence of fees and expenses incurred as the Corporation
reasonably may require.
4. Mitigation. Except as provided in subsection 3(a)(ii)(C) hereof, in no
event shall the Executive be obligated to seek other employment or take any
other action by way of mitigation of the amounts (including amounts for damages
for breach) payable to the Executive under any of the provisions of this
Agreement and such amounts shall not be reduced whether or not the Executive
obtains other employment.
5. Confidential Information and Nondisparagement. The Executive shall hold
in a fiduciary capacity for the benefit of the Corporation all secret,
confidential or proprietary information, knowledge or data relating to the
Corporation or any of their affiliated companies, and their respective
businesses, that shall have been obtained by the Executive during the
Executive's employment by the Corporation or any of their affiliated companies
and that shall not have been or now or hereafter have become public knowledge
(other than by acts by the Executive or representatives of the Executive in
violation of this Agreement). During the Term, and at all times thereafter,
regardless of the reason for termination of the Executive's employment, the
Executive shall not, without the prior written consent of the Corporation or as
may otherwise be required by law or legal process, communicate or divulge any
such information, knowledge or data to anyone other than the Corporation and
those designated by it. The Executive understands that during the Term, the
Corporation may be required from time to time to make public disclosure of the
terms or existence of this Agreement in order to comply with various laws and
legal requirements.
During the Term and at all times thereafter, the Executive shall not disparage
or criticize, orally or in writing, the performance of the Corporation, the
Board, any director of the Corporation, any specific former or current officer
of the Corporation or any operating company, any group president or the
Corporation's management group to any person; provided, however, that the
Executive may divulge, discuss or provide the information described above to the
extent that he is compelled by law to do so, and, in such event, the Executive
shall notify the Corporation immediately upon any request or demand for
information so that the Corporation may seek a protective order or other
appropriate remedy.
6. Successors.
(a) This Agreement is personal to the Executive and without the prior
written consent of the Corporation shall not be assignable by the Executive,
except that this Agreement shall inure to the benefit of and be enforceable by
the Executive's legal representatives.
(b) The Corporation shall require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Corporation to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Corporation would be required to perform this Agreement if no
such succession had taken place.
7. Arbitration. Any controversy or claim arising out of or relating to
this Agreement or the breach of this Agreement shall be settled exclusively by
arbitration conducted before a panel of three arbitrators (one chosen by the
Executive, one by the Corporation and the third by the other two) in Muncie,
Indiana, in accordance with the rules of the American Arbitration Association
then in effect. The determination of the arbitrators shall be conclusive and
binding on the Corporation and the Executive, and judgment may be entered on the
arbitrators' award in any court having appropriate jurisdiction; provided,
however, that the Corporation shall be entitled to seek a restraining order or
injunction in any court of competent jurisdiction to prevent any continuation of
any violation of Section 5 of this Agreement.
8. Miscellaneous.
(a) This Agreement shall be governed by and construed in accordance
with the laws of the State of Indiana, without reference to principles of
conflict of laws.
(b) The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect.
(c) This Agreement may not be amended, modified, repealed, waived,
extended or discharged except by an agreement in writing signed by the party
against whom enforcement of such amendment, modification, repeal, waiver,
extension or discharge is sought. No person, other than pursuant to a resolution
of the Board or a committee thereof, shall have authority on behalf of the
Corporation to agree to amend, modify, repeal, waive, extend or discharge any
provision of this Agreement or anything in reference thereto.
(d) The parties hereto acknowledge that the Executive's employment
relationship is employment at will, except for the Corporation's obligations
under this Agreement.
(e) All notices and other communications hereunder shall be in writing
and shall be given by hand delivery to the other party or by registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
If to the Executive: (address)
If to Ball Corporation: Ball Corporation
345 South High Street
Muncie, IN 47305
Attention: Corporate Secretary
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
(f) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement.
(g) The Corporation may withhold from any amounts payable under this
Agreement such federal, state or local taxes as shall be required to be withheld
pursuant to any applicable law or regulation.
(h) The Executive's or the Corporation's failure to insist upon strict
compliance with any provision hereof or any other provision of this Agreement or
the failure to assert any right the Executive or the Corporation may have
hereunder, including without limitation the right of the Executive to terminate
employment for Constructive Termination pursuant to subsection 2(c) of this
Agreement, or the right of the Corporation to terminate the Executive's
employment for Cause pursuant to subsection 2(b) of this Agreement, shall not be
deemed to be a waiver of such provision or right or any other provision or right
of this Agreement.
(i) This Agreement may be executed in counterparts, each of which
shall be deemed to be an original but all of which together will constitute one
and the same instrument.
IN WITNESS WHEREOF, the Executive and, pursuant to due authorization from
its Board of Directors, the Corporation has caused this Agreement to be executed
as of the day and year first above written.
BALL CORPORATION
__________________________
Name:
__________________________
Title:
EXECUTIVE
__________________________
(name)