EXHIBIT 10
FIRST AMENDMENT
TO
SEVERANCE AGREEMENT
This First Amendment to Severance Agreement (this "First Amendment"), dated
as of this ___ day of ________, 1999, amends that certain Severance Agreement
dated as of , 1999, by and between Apogee Enterprises, Inc., a Minnesota
corporation (the "Company"), and _______________ (the "Executive"), a resident
of the State of Minnesota (the "Agreement").
WHEREAS, the Agreement specifies the financial arrangements that the
Company will provide to Executive upon Executive's separation from employment
with the Company under the circumstances described therein; and
WHEREAS, the parties desire to amend the Agreement in the manner set forth
herein in order to enhance the Company's ability to attract and retain highly
qualified people.
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. Section 4(i)(b)(II) of the Agreement is hereby deleted in its entirety
and the following is substituted therefor:
"(II) twenty-four (24) times the sum of (A) Executive's monthly base
salary (as in effect in the month preceding the month in which the
termination becomes effective or as in effect in the month preceding the
Change in Control, whichever is higher) and (B) one-twelfth (1/12) of the
Target Bonus;"
2. Section 4(iii) of the Agreement is hereby deleted in its entirety and
the following is substituted therefor:
"(iii) Upon the occurrence of a Change in Control, the Company shall
cause its independent auditors promptly to review, at the Company's sole
expense, the applicability of Section 4999 of the Internal Revenue Code of
1986, as amended (the "Code") to the "Total Payments" (as defined in
Section 4(iv) below) to be received by Executive. If such auditors
determine that, after taking into account the provisions of Section 4(iv)
hereof, any of the Total Payments would be subject to the excise tax
imposed by Section 4999 of the Code, or any interest or penalties with
respect to such tax (such excise tax, together with interest and penalties,
are collectively referred to as the "Excise Tax"), then, in addition to any
amounts payable under foregoing provisions of this Section 4, the Company
shall pay an additional cash payment (a "Gross-Up Payment") within 30 days
of such determination equal to the Excise Tax imposed on the Total
Payments, including any Excise Tax or any other income taxes that may be
imposed on such Gross-Up Payment. If no determination by the Company's
auditors is made prior to the time a tax return reflecting the Total
Payments is required to be filed by Executive, Executive will be entitled
to receive a Gross-Up Payment calculated on the basis of the Total Payments
reported by him in such tax return, within 30 days of the filing of such
tax return. In all events, if any tax authority determines that a greater
Excise Tax should be imposed on the Total Payments than is determined by
the Company's independent auditors or reflected in Executive's tax return
pursuant to this subparagraph (iii), Executive shall be entitled to receive
the full Gross-Up Payment calculated on the basis of the amount of Excise
Tax determined to be payable by such tax authority from the Company within
30 days of such determination."
3. Section 4(iv) of the Agreement is hereby deleted in its entirety and the
following is substituted therefor:
"(iv) As used herein, "Total Payments" shall mean, collectively, any
payment or benefit received or to be received by Executive in connection
with a Change in Control of the Company or termination of Executive's
employment (whether payable pursuant to the terms of this Agreement or any
other plan, contract, agreement or arrangement with the Company, with any
person whose actions result in a Change in Control of the Company or with
any person constituting a member of an "affiliated group" as defined in
Section 280G(d)(5) of the Code) with the Company or with any person whose
actions result in a Change in Control of the Company. For purposes of
calculating Total Payments, (a) no portion of the Total Payments the
receipt or enjoyment of which Executive shall have effectively waived in
writing prior to the date of payment of the Severance Payment shall be
taken into account; (b) no portion of the Total Payments shall be taken
into account which in the opinion of tax counsel selected by the Company
and acceptable to Executive does not constitute a "parachute payment"
within the meaning of Section 280G(b)(2) of the Code; (c) the value of any
benefit provided by Section 4(i)(f) of this Agreement shall not be taken
into account in computing Total Payments; and (d) the value of any other
non-cash benefit or of any deferred cash payment included in the Total
Payments shall be determined by the Company's independent auditors in
accordance with the principles of Sections 280G(d)(3) and (4) of the Code.
In case of uncertainty as to whether all or some portion of a payment is or
is not payable to Executive under this Agreement, the Company shall
initially make the payment to Executive, and Executive agrees to refund to
the Company any amounts ultimately determined not to have been payable
under the terms hereof."
4. Any capitalized term used herein and not otherwise defined herein shall
have the meaning given to such term in the Agreement.
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5. This First Amendment constitutes an amendment of the Agreement in
conformity with and pursuant to the terms of Section 7 of the Agreement. Except
as expressly amended herein, all terms set forth in the Agreement shall continue
in full force and effect.
6. The operative terms of this First Amendment may be inserted into a First
Amended and Restated Agreement by the parties and shall have a date as of the
day and year first set forth herein.
7. The internal law, and not the law of conflicts, of the State of
Minnesota will govern all questions concerning the construction, validity and
interpretation of this First Amendment and the performance of the obligations
imposed by this First Amendment.
IN WITNESS WHEREOF, the parties have executed this First Amendment as of
the day and year first above written.
APOGEE ENTERPRISES, INC.
By___________________________
Its________________________
EXECUTIVE
_____________________________
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