Unassociated Document


    
      

    

    Exhibit
10.3

     

    


    AMENDED
AND RESTATED

    SEVERANCE
AGREEMENT

     

    THIS
AMENDED AND RESTATED SEVERANCE AGREEMENT (the “Agreement”), dated as
of December 22, 2008, is made and entered by and between Harman International
Industries, Incorporated (“Harman” or, including
any successor thereto, the “Company”), a Delaware
corporation, and Herbert K. Parker (the “Executive”).

     

    WHEREAS,
the Executive is a senior executive of Harman and is expected to make major
contributions to the Company’s short and long-term profitability, growth and
financial strength;

     

    WHEREAS,
Harman recognizes that: (a) top-quality executives may seek more secure career
opportunities if a Change in Control, as defined below, occurs in the future;
and (b) the Company may encounter difficulties in recruiting qualified senior
executives unless it offers an employment security arrangement, applicable in
Change in Control situations;

     

    WHEREAS,
Harman desires to assure itself of both present and future continuity of
management and desires to establish certain minimum severance benefits for
certain of its senior executives, including the Executive, applicable in the
event of a Change in Control;

     

    WHEREAS,
Harman wishes to ensure that its senior executives are not practically disabled
from discharging their duties in respect of a proposed or actual transaction
involving a Change in Control; and

     

    WHEREAS,
Harman desires to provide additional inducement for the Executive to continue to
remain in the Company’s employ.

     

    NOW,
THEREFORE, Harman and the Executive agree as follows:

     

    1.             Certain Defined
Terms.  In addition to terms defined elsewhere in this
Agreement, the following terms have the following meanings:

     

    (a)           “Base Pay” means the
Executive’s annual base salary rate as in effect from time to time;

     

    (b)           “Board” means Harman’s
Board of Directors;

     

    (c)           “Cause” means that,
prior to any termination pursuant to Section 3(b), the Executive shall
have:

     

    (i)        
   been convicted of a criminal violation involving fraud,
embezzlement or theft in connection with his duties or in the course of his
employment with the Company or any Subsidiary;

     

    (ii)           committed
intentional wrongful damage to property of Harman or any Harman
subsidiary;


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    (iii)           committed
intentional wrongful disclosure of secret processes or confidential information
of Harman or any Subsidiary; or

     

    (iv)          committed
intentional wrongful engagement in any Competitive Activity;

     

    and any
such act shall have been demonstrably and materially harmful to
Harman.  For purposes of this Agreement, no act or failure to act on
the part of the Executive shall be deemed “intentional” if it was due primarily
to an error in judgment or negligence, but shall be deemed “intentional” only if
done or omitted to be done by the Executive not in good faith and without
reasonable belief that the Executive’s action or omission was in the best
interest of Harman.  Notwithstanding the foregoing, the Executive
shall not be deemed to have been terminated for “Cause” hereunder unless and
until there shall have been delivered to the Executive a copy of a resolution
duly adopted by the affirmative vote of a majority of the Committee then in
office at a meeting of the Committee called and held for such purpose, after
reasonable notice to the Executive and an opportunity for the Executive,
together with the Executive’s counsel (if the Executive chooses to have counsel
present at such meeting), to be heard before the Committee, finding that, in the
good faith opinion of the Committee, the Executive had committed an act
constituting “Cause” as defined in this Agreement and specifying the particulars
thereof in detail.  Nothing in this Agreement will limit the right of
the Executive or his beneficiaries to contest the validity or propriety of any
such determination;

     

    (d)           “Change in Control”
means the occurrence during the Term of any of the following
events:

     

    (i)        
   The acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 25% or more of the combined voting power of the then
outstanding Voting Stock of the Company; provided, however, that for purposes of
this Section 1(d)(i), the following acquisitions shall not constitute a Change
in Control:  (A) any issuance of Voting Stock of the Company directly
from the Company that is approved by the Incumbent Board (as defined in Section
1(d)(ii), below), (B) any acquisition by the Company or a Subsidiary of Voting
Stock of the Company, (C) any acquisition of Voting Stock of the Company by any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any Subsidiary, or (D) any acquisition of Voting Stock of the Company by any
Person pursuant to a Business Combination (as defined in Section 1(d)(iii)
below) that complies with clauses (A), (B) and (C) of Section 1(d)(iii), below;
or

     

    (ii)        
   individuals who, as of the date hereof, constitute the Board
(the “Incumbent
Board”) cease for any reason to constitute at least a majority of the
Board; provided, however, that any
individual becoming a Director after the date hereof whose election, or
nomination for election by the Company’s shareholders, was approved by a vote of
at least two-thirds of the Directors then comprising the Incumbent Board (either
by a specific vote or by approval of the proxy statement of the Company in which
such person is named as a nominee for director, without objection to such
nomination) shall be deemed to have been a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest (within
the meaning of Rule 14a-11 of the Exchange Act) with respect to the election or
removal of Directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board; or


    
      
         


      

      
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    (iii)           consummation
of a reorganization, merger or consolidation, a sale or other disposition of all
or substantially all of the assets of the Company, or other transaction (each, a
“Business
Combination”), unless, in each case, immediately following such Business
Combination, (A) all or substantially all of the individuals and entities who
were the beneficial owners of Voting Stock of the Company immediately prior to
such Business Combination beneficially own, directly or indirectly, more than
50% of the combined voting power of the then outstanding shares of Voting Stock
of the entity resulting from such Business Combination (including, without
limitation, an entity which as a result of such transaction owns the Company or
all or substantially all of the Company’s assets either directly or through one
or more subsidiaries), (B) no Person (other than the Company, such entity
resulting from such Business Combination, or any employee benefit plan (or
related trust) sponsored or maintained by the Company, any Subsidiary or such
entity resulting from such Business Combination) beneficially owns, directly or
indirectly, 25% or more of the combined voting power of the then outstanding
shares of Voting Stock of the entity resulting from such Business Combination,
and (C) at least a majority of the members of the Board of Directors of the
entity resulting from such Business Combination were members of the Incumbent
Board at the time of the execution of the initial agreement or of the action of
the Board providing for such Business Combination; or

     

    (iv)           approval
by the shareholders of the Company of a complete liquidation or dissolution of
the Company, except pursuant to a Business Combination that complies with
clauses (A), (B) and (C) of Section 1(d)(iii).

     

    (e)           “Committee” means the
Compensation and Option Committee of the Board or such similar committee of the
Board comprised of non-officer directors and responsible for executive
compensation matters of the Company generally;

     

    (f)           “Competitive Activity”
means the Executive’s participation, without the Company’s written consent, in
the management of any business enterprise if such enterprise engages in
substantial and direct competition with the Company or a Subsidiary and the
enterprise’s sales of any product or service under the Executive’s supervision
competitive with any product or service of the Company or a Subsidiary amounted
to 10% of the enterprise’s net sales for its most recently completed fiscal year
and if the Company’s and its Subsidiary’s net sales of said product or service
amounted to 10% of the Company’s net sales for its most recently completed
fiscal year.  “Competitive Activity” will not include (i) the mere
ownership of securities in any such enterprise and the exercise of rights
appurtenant thereto or (ii) participation in the management of any such
enterprise other than in connection with the competitive operations of such
enterprise;


    
      
         


      

      
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    (g)           “Employee Benefits”
means the perquisites, benefits and service credit for benefits as provided
under any and all employee retirement income and welfare benefit policies,
plans, programs or arrangements in which Executive is entitled to participate,
including without limitation any stock option, performance share, performance
unit, stock purchase, stock appreciation, savings, pension, supplemental
executive retirement, or other retirement income or welfare benefit, deferred
compensation, incentive compensation, group or other life, health,
medical/hospital or other insurance (whether funded by actual insurance or
self-insured by the Company or a Subsidiary), disability, salary continuation,
expense reimbursement and other employee benefit policies, plans, programs or
arrangements that may now exist or any equivalent successor policies, plans,
programs or arrangements that may be adopted by the Company or a Subsidiary,
providing perquisites, benefits and service credit for benefits at least as
great in the aggregate as are payable thereunder prior to a Change in
Control;

     

    (h)           “Exchange Act” means
the Securities Exchange Act of 1934, as amended from time to time;

     

    (i)         
  “Incentive
Pay” means an annual bonus, incentive or other payment of compensation,
in addition to Base Pay, made or to be made in regard to services rendered in
any year or other period pursuant to any bonus, incentive, profit-sharing,
performance, discretionary pay or similar agreement, policy, plan, program or
arrangement (whether or not funded) of the Company or a Subsidiary, or any
successor thereto;

     

    (j)       
    “Retirement Plans”
means the retirement income, supplemental executive retirement, excess benefits
and retiree medical, life and similar benefit plans providing retirement
perquisites, benefits and service credit for benefits at least as great in the
aggregate as are payable thereunder prior to a Change in Control;

     

    (k)           “Severance Period”
means the period of time commencing six months prior to the date of the first
occurrence of a Change in Control and continuing until the earlier of (i) the
second anniversary of the occurrence of the Change in Control, or (ii) the
Executive’s death; provided, however, that
commencing on each anniversary of the Change in Control, the Severance Period
will automatically be extended for an additional year unless, not later than 90
calendar days before the anniversary date, either the Company or the Executive
shall have given written notice to the other that the Severance Period is not to
be so extended;

     

    (l)       
    “Subsidiary” means an
entity in which the Company, directly or indirectly, beneficially owns 50% or
more of the outstanding Voting Stock;

     

    (m)           “Term” means the
period commencing as of the date hereof and expiring as of the later of (i) the
close of business on December 31, 2012, or (ii) the expiration of the Severance
Period.  However, commencing on January 1, 2012 and each January 1
thereafter, the term of this Agreement will automatically be extended for an
additional year unless, not later than September 30 of the immediately preceding
year, the Company or the Executive shall have given notice that it or the
Executive, as the case may be, does not wish to have the Term
extended.  Furthermore, if prior to the date which is six months prior
to a Change in Control, the Executive ceases for any reason to be an officer of
the Company or any Subsidiary, thereupon without further action the Term shall
be deemed to have expired and this Agreement will immediately terminate and be
of no further effect.  For purposes of this Section, the Executive
shall not be deemed to have ceased to be an officer of the Company and any
Subsidiary by reason of the transfer of Executive’s employment between the
Company and any Subsidiary, or among any Subsidiaries;


    
      
         


      

      
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    (n)           “Termination Date”
means the date on which the Executive’s employment is terminated (the effective
date of which shall be the date of termination, or such other date that may be
specified by the Executive if the termination is pursuant to Section 3(b));
provided, however, that if the Termination Date precedes the Change in Control,
then any additional payments and benefits that are due upon a Change in Control
and that are deferred compensation within the meaning of Section 409A shall be
subject to the Section 409A Delay, as defined below, and payable upon the Change
in Control; and

     

    (o)           “Voting Stock” means
securities entitled to vote generally in the election of directors.

     

    2.       
     Operation of
Agreement.  This Agreement will be effective and binding
immediately upon its execution, but anything in this Agreement to the contrary
notwithstanding, this Agreement will not be operative unless and until the date
which is six months prior to a Change in Control occurs.  If a Change
in Control occurs at any time during the Term, this Agreement shall become
operative immediately and retroactively, including without limitation,
notwithstanding that the Term may have since expired.

     

    3.          
  Termination Following a
Change in Control.  (a) In the event of the occurrence of a
Change in Control, the Executive’s employment may be terminated by the Company
or a Subsidiary during the Severance Period and the Executive shall be entitled
to the benefits provided by Section 4 as a result thereof or of any termination
within six months prior to a Change in Control unless such termination is the
result of the occurrence of one or more of the following events:

     

    (i)    
       The Executive’s death;

     

    (ii)           The
Executive becoming permanently disabled within the meaning of, and begins
actually receiving disability benefits pursuant to, the long-term disability
plan in effect for, or applicable to, Executive immediately prior to the Change
in Control; or

     

    (iii)           Cause.

     

    If,
during the Severance Period, the Executive’s employment is terminated by the
Company or any Subsidiary other than pursuant to Section 3(a)(i), 3(a)(ii) or
3(a)(iii), the Executive will be entitled to the benefits provided by Section 4
hereof.

     

    (b)           In
the event of the occurrence of a Change in Control, the Executive may terminate
employment with the Company and any Subsidiary during the Severance Period with
the right to severance compensation as provided in Section 4 upon the occurrence
of one or more of the following events (regardless of whether any other reason,
other than Cause, for such termination exists or has occurred, including without
limitation other employment) and shall also have such severance compensation in
the event he had terminated employment upon the occurrence of one or more of the
following events within six months prior to the Change in
Control:


    
      
         


      

      
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    (i)    
       Failure to elect or reelect or
otherwise to maintain the Executive in the office or the position, or a
substantially equivalent office or position, of or with the Company and/or a
Subsidiary (or any successor thereto by operation of law or otherwise), as the
case may be, which the Executive held immediately prior to a Change in Control,
or the removal of the Executive as a Director of the Company and/or a Subsidiary
(or any successor thereto) if the Executive shall have been a Director of the
Company and/or a Subsidiary immediately prior to the Change in
Control;

     

    (ii)           (A)
A significant adverse change in the nature or scope of the authorities, powers,
functions, responsibilities or duties attached to the position with the Company
and any Subsidiary which the Executive held immediately prior to the Change in
Control, (B) a reduction in the aggregate of the Executive’s Base Pay and
Incentive Pay received from the Company and any Subsidiary, or (C) the
termination or denial of the Executive’s rights to Employee Benefits or a
reduction in the scope or value thereof, any of which is not remedied by the
Company within 10 calendar days after receipt by the Company of written notice
from the Executive of such change, reduction or termination, as the case may
be;

     

    (iii)           A
determination by the Executive (which determination will be conclusive and
binding upon the parties to this Agreement, provided that the determination has
been made in good faith and in all events will be presumed to have been made in
good faith unless otherwise shown by the Company by clear and convincing
evidence) that a change in circumstances has occurred following a Change in
Control, including, without limitation, a change in the scope of the business or
other activities for which the Executive was responsible immediately prior to
the Change in Control, which has rendered the Executive substantially unable to
carry out, has substantially hindered Executive’s performance of, or has caused
Executive to suffer a substantial reduction in, any of the authorities, powers,
functions, responsibilities or duties attached to the position held by the
Executive immediately prior to the Change in Control, which situation is not
remedied within 10 calendar days after the Company receives written notice from
the Executive of such determination;

     

    (iv)          The
liquidation, dissolution, merger, consolidation or reorganization of the Company
or transfer of all or substantially all of its business and/or assets, unless
the successor or successors (by liquidation, merger, consolidation,
reorganization, transfer or otherwise) to which all or substantially all of its
business and/or assets have been transferred (by operation of law or otherwise)
assumed all duties and obligations of the Company under this Agreement pursuant
to Section 11(a);

     

    (v)           The
Company relocates its principal executive offices (if such offices are the
principal location of Executive’s work), or requires the Executive to have his
principal location of work changed, to any location that, in either case, is in
excess of 50 miles from the principal executive office’s location immediately
prior to the Change in Control, or requires the Executive to travel away from
his office in the course of discharging his responsibilities or duties at least
20% more (in terms of aggregate days in any calendar year or in any calendar
quarter when annualized for purposes of comparison to any prior year) than was
required of Executive in any of the three full years immediately prior to the
Change in Control without, in either case, his prior written consent;
or


    
      
         


      

      
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    (vi)           Without
limiting the generality or effect of the foregoing, any material breach of this
Agreement by the Company or any successor thereto which is not remedied by the
Company within 10 calendar days after receipt by the Company of written notice
from the Executive of such breach.

     

    (c)           A
termination by the Company pursuant to Section 3(a) or by the Executive pursuant
to Section 3(b) will not affect any rights that the Executive may have pursuant
to any agreement, policy, plan, program or arrangement of the Company or any
Subsidiary providing Employee Benefits, which rights shall be governed by the
terms thereof; provided that the Executive shall not be entitled to a severance
payment or benefit under any other agreement with the Company, including,
without limitation, any employment agreement, if the Executive is entitled to a
comparable payment or benefit hereunder.

     

    4.         
   Severance
Compensation.  a) If the Company or Subsidiary terminates the
Executive’s employment during the Severance Period other than pursuant to
Section 3(a)(i), 3(a)(ii) or 3(a)(iii), or if the Executive terminates his
employment pursuant to Section 3(b), the Company will pay to the Executive,
subject to Section 18 hereof as to the Section 409A Delay, the amount described
in Paragraph (a) of Annex A within five business days after the Termination Date
and will continue to provide to the Executive the benefits described in
Paragraphs (b) and (c) of Annex A for the periods described therein; provided, however, that no
payment that would otherwise be made and no benefit that would otherwise be
provided upon a termination of employment that is deferred compensation for
purposes of Section 409A shall be made or provided, as the case may be, unless
and until such termination of employment also constitutes a separation from
service (within the meaning of Section 409A).

     

    (b)           Without
limiting the rights of the Executive at law or in equity, if the Company fails
to make any payment or provide any benefit required to be made or provided under
this Agreement on a timely basis, the Company will pay interest on the amount or
value thereof at an annualized rate of interest equal to the so-called composite
“prime rate” as quoted from time to time during the relevant period in The Wall Street
Journal , plus 2%.  Such interest will be payable as it accrues
on demand.  Any change in such prime rate will be effective on and as
of the date of such change.

     

    (c)           Notwithstanding
any provision of this Agreement to the contrary, the parties’ respective rights
and obligations under this Section 4 and under Sections 5, 7 and 8 will survive
any termination or expiration of this Agreement or the termination of the
Executive’s employment following a Change in Control for any reason
whatsoever.

     

    5.        
    Certain Additional Payments
by the Company.  b) Anything in this Agreement to the contrary
notwithstanding, in
the event that this Agreement shall become operative and it shall be determined
(as hereafter provided) that any payment (other than the Gross-Up Payments
provided for in this Section 5) or distribution by the Company or any of its
affiliates to or for the benefit of the Executive, whether paid or payable or
distributed or distributable under the terms of this Agreement or otherwise
pursuant to or by reason of any other agreement, policy, plan, program or arrangement,
including without limitation any stock option, performance share, performance
unit, stock appreciation right or similar right, or the lapse or termination of
any restriction on or the vesting or exercisability of any of the foregoing (a
“Payment”),
would be subject to the excise tax imposed by Section 4999 of the Internal
Revenue Code of 1986, as amended (the “Code”) (or any
successor provision thereto) by reason of being considered “contingent on a
change in ownership or control” of the Company, within the meaning of Section
280G of the Code (or any successor provision thereto) or to any similar tax
imposed by state or local law, or any interest or penalties with respect to such
tax (such tax or  taxes, together with any such interest and
penalties, being hereafter collectively referred to as the “Excise Tax”), then
the Executive shall be entitled to receive, and the Company shall be required to
pay, an additional payment or payments (collectively, a “Gross-Up Payment”);
provided, however, that no
Gross-Up Payment shall be made with respect to the Excise Tax, if any,
attributable to (i) any incentive stock option, as defined by Section 422 of the
Code (“ISO”)
granted prior to the execution of this Agreement, or (ii) any stock appreciation
or similar right, whether or not limited, granted in tandem with any ISO
described in clause (i).  The Gross-Up Payment shall be in an amount
such that, after payment by the Executive of all taxes (including any interest
or penalties imposed with respect to such taxes), including any Excise Tax
imposed upon the Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the
Payment.


    
      
         


      

      
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    (b)           Subject
to the provisions of Section 5(f), all determinations required to be made under
this Section 5, including whether an Excise Tax is payable by the Executive and
the amount of such Excise Tax and whether a Gross-Up Payment is required to be
paid by the Company to the Executive and the amount of such Gross-Up Payment, if
any, shall be made by a nationally recognized accounting firm (the “Accounting Firm”)
selected by the Executive in his sole discretion.  The Executive shall
direct the Accounting Firm to submit its determination and detailed supporting
calculations to both the Company and the Executive within 30 calendar days after
the Termination Date, if applicable, and any such other time or times as may be
requested by the Company or the Executive.  If the Accounting Firm
determines that any Excise Tax is payable by the Executive, the Company shall
pay the required Gross-Up Payment to the Executive within five business days
after receipt of such determination and calculations with respect to any Payment
to the Executive.  If the Accounting Firm determines that no Excise
Tax is payable by the Executive, it shall, at the same time as it makes such
determination, furnish the Company and the Executive an opinion that the
Executive has substantial authority not to report any Excise Tax on his federal,
state or local income or other tax return.  As a result of the
uncertainty in the application of Section 4999 of the Code (or any successor
provision thereto) and the possibility of similar uncertainty regarding
applicable state or local tax law at the time of any determination by the
Accounting Firm hereunder, it is possible that Gross-Up Payments which will not
have been made by the Company should have been made (an “Underpayment”),
consistent with the calculations required to be made hereunder.  In
the event that the Company exhausts or fails to pursue its remedies pursuant to
Section 5(f) and the Executive thereafter is required to make a payment of any
Excise Tax, the Executive shall direct the Accounting Firm to determine the
amount of the Underpayment that has occurred and to submit its determination and
detailed supporting calculations to both the Company and the Executive as
promptly as possible.  Any such Underpayment shall be promptly paid by
the Company to, or for the benefit of, the Executive within five business days
after receipt of such determination and calculations.


    
      
         


      

      
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    (c)           The
Company and the Executive shall each provide the Accounting Firm access to and
copies of any books, records and documents in the possession of the Company or
the Executive, as the case may be, reasonably requested by the Accounting Firm,
and otherwise cooperate with the Accounting Firm in connection with the
preparation and issuance of the determinations and calculations contemplated by
Section 5(b).  Any determination by the Accounting Firm as to the
amount of the Gross-Up Payment shall be binding upon the Company and the
Executive.

     

    (d)           The
federal, state and local income or other tax returns filed by the Executive
shall be prepared and filed on a consistent basis with the determination of the
Accounting Firm with respect to the Excise Tax payable by the
Executive.  The Executive shall make proper payment of the amount of
any Excise Tax, and at the request of the Company, provide to the Company true
and correct copies (with any amendments) of the applicable portions of his
federal income tax return as filed with the Internal Revenue Service and
corresponding state and local tax returns, if relevant, as filed with the
applicable taxing authority, and such other documents reasonably requested by
the Company, evidencing such payment.  If prior to the filing of the
Executive’s federal income tax return, or corresponding state or local tax
return, if relevant, the Accounting Firm determines that the amount of the
Gross-Up Payment should be reduced, the Executive shall within five business
days pay to the Company the amount of such reduction.

     

    (e)           The
fees and expenses of the Accounting Firm for its services in connection with the
determinations and calculations contemplated by Section 5(b) shall be borne by
the Company.  If such fees and expenses are initially paid by the
Executive, the Company shall reimburse the Executive the full amount of such
fees and expenses within five business days after receipt from the Executive of
a statement therefor and reasonable evidence of Executive’s payment
thereof.

     

    (f)           The
Executive shall notify the Company in writing of any claim by the Internal
Revenue Service or any other taxing authority that, if successful, would require
the payment by the Company of a Gross-Up Payment.  Such notification
shall be given as promptly as practicable but no later than 10 business days
after the Executive actually receives notice of such claim and the Executive
shall further apprise the Company of the nature of such claim and the date on
which such claim is requested to be paid (in each case, to the extent known by
the Executive).  The Executive shall not pay such claim prior to the
earlier of (i) the expiration of the 30 calendar day period following the date
on which he gives such notice to the Company and (ii) the date that any payment
of amount with respect to such claim is due.  If the Company notifies
the Executive in writing prior to the expiration of such period that it desires
to contest such claim, the Executive shall:

     

    (i)      
      provide the Company with any written records
or documents in his possession relating to such claim reasonably requested by
the Company;


    
      
         


      

      
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    (ii)        
   take such action in connection with contesting such claim as
the Company shall reasonably request in writing from time to time, including
without limitation accepting legal representation with respect to such claim by
an attorney competent in respect of the subject matter and reasonably selected
by the Company;

     

    (iii)           cooperate
with the Company in good faith in order effectively to contest such claim;
and

     

    (iv)           permit
the Company to participate in any proceedings relating to such claim; provided, however, that the
Company shall bear and pay directly all costs and expenses (including interest
and penalties) incurred in connection with such contest and shall indemnify and
hold harmless the Executive, on an after-tax basis, for and against any Excise
Tax or income tax, including interest and penalties with respect thereto,
imposed as a result of such representation and payment of costs and
expenses.  Without limiting the foregoing provisions of this Section
5(f), the Company shall control all proceedings taken in connection with the
contest of any claim contemplated by this Section 5(f) and, at its sole option,
may pursue or forego any and all administrative appeals, proceedings, hearings
and conferences with the taxing authority in respect of such claim (provided,
however, that the Executive may participate therein at his own cost and expense)
and may, at its option, either direct the Executive to pay the tax claimed and
sue for a refund or contest the claim in any permissible manner, and the
Executive agrees to prosecute such contest to a determination before any
administrative tribunal, in a court of initial jurisdiction and in one or more
appellate courts, as the Company shall determine; provided, however, that if the
Company directs the Executive to pay the tax claimed and sue for a refund, the
Company shall advance the amount of such payment to the Executive on an
interest-free basis and shall indemnify and hold the Executive harmless, on an
after-tax basis, from any Excise Tax or income or other tax, including interest
or penalties with respect thereto, imposed with respect to such advance; and
provided further, however, that any
extension of the statute of limitations relating to payment of taxes for the
taxable year of the Executive with respect to which the contested amount is
claimed to be due is limited solely to such contested
amount.  Furthermore, the Company’s control of any such contested
claim shall be limited to issues with respect to which a Gross-Up Payment would
be payable hereunder and the Executive shall be entitled to settle or contest,
as the case may be, any other issue raised by the Internal Revenue Service or
any other taxing authority.

     

    (g)           If,
after the receipt by the Executive of an amount advanced by the Company pursuant
to Section 5(f), the Executive receives any refund with respect to such claim,
the Executive shall (subject to the Company’s complying with the requirements of
Section 5(f)) promptly pay to the Company the amount of such refund (together
with any interest paid or credited thereon after any taxes applicable
thereto).  If, after the receipt by the Executive of an amount
advanced by the Company pursuant to Section 5(f), a determination is made that
the Executive shall not be entitled to any refund with respect to such claim and
the Company does not notify the Executive in writing of its intent to contest
such denial or refund prior to the expiration of 30 calendar days after such
determination, then such advance shall be forgiven and shall not be required to
be repaid and the amount of any such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be paid by the Company to
the Executive pursuant to this Section 5.


    
      
         


      

      
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    (h)           In
the event any obligation of the Executive to repay any amounts due hereunder
would be a violation of the “loan” provisions of the Sarbanes-Oxley Act, such
obligation shall be treated as null and void ab
initio.

     

    (i)        
   Notwithstanding the foregoing provisions of Section 5, (i) a
Gross-Up Payment, or portion thereof, attributable to Paragraph (1) of Annex A
will be subject to the Section 409A Delay; (ii) Gross-Up Payments will be paid
no later than the time prescribed therefor by Section 1.409A-3(i)(1)(v) of the
Treasury Regulations; and (iii) reimbursements under Sections 5(e) and 5(f)
shall be paid no later than December 31 of the calendar year following the
calendar year in which the related expense is incurred; provided that in no
event shall the reimbursement provided by the Company in one taxable year affect
the amount of reimbursement provided in any other taxable year nor shall
Executive’s right to reimbursement be subject to liquidation or exchange for
another benefit.

     

    6.        
    No Mitigation
Obligation.  The Company hereby acknowledges that it will be
difficult and may be impossible for the Executive to find reasonably comparable
employment following the Termination Date and that the non-competition covenant
contained in Section 8 will further limit the employment opportunities for the
Executive.  In addition, the Company acknowledges that its severance
pay plans applicable in general to its salaried employees do not provide for
mitigation, offset or reduction of any severance payment received
thereunder.  Accordingly, the payment of the severance compensation by
the Company to the Executive in accordance with the terms of this Agreement is
hereby acknowledged by the Company to be reasonable, and the Executive will not
be required to mitigate the amount of any payment provided for in this Agreement
by seeking other employment or otherwise, nor will any profits, income, earnings
or other benefits from any source whatsoever create any mitigation, offset,
reduction or any other obligation on the part of the Executive under this
Agreement or otherwise.

     

    7.        
    Legal Fees and
Expenses.  c) The Executive shall not be required to incur
legal fees and the related expenses associated with the interpretation,
enforcement or defense of Executive’s rights under this Agreement by litigation
or otherwise because such costs substantially would detract from the Executive’s
benefits under this Agreement.  Accordingly, if it should appear to
the Executive that the Company has failed to comply with any of its obligations
under this Agreement or in the event that the Company or any other person takes
or threatens to take any action to declare this Agreement void or unenforceable,
or institutes any litigation or other action or proceeding designed to deny, or
to recover from, the Executive the benefits provided or intended to be provided
to the Executive hereunder, the Company irrevocably authorizes the Executive
from time to time to retain counsel of Executive’s choice, at the expense of the
Company as hereafter provided, to advise and represent the Executive in
connection with any such interpretation, enforcement or defense, including
without limitation the initiation or defense of any litigation or other legal
action, whether by or against the Company or any Director, officer, stockholder
or other person affiliated with the Company, in any
jurisdiction.  Notwithstanding any existing or prior attorney-client
relationship between the Company and such counsel, the Company irrevocably
consents to the Executive’s entering into an attorney-client relationship with
such counsel, and in that connection the Company and the Executive agree that a
confidential relationship shall exist between the Executive and such
counsel.  Without respect to whether the Executive prevails, in whole
or in part, in connection with any of the foregoing, the Company will pay and be
solely financially responsible for any and all attorneys’ and related fees and
expenses incurred by the Executive in connection with any of the
foregoing.  However, if the Executive brings an action in bad faith,
or with no colorable claim of success, the Company shall not pay for any of
Executive’s attorneys’ fees or related expenses.


    
      
         


      

      
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    (b)           Without
limiting the obligations of the Company under Section 7(a) of this Agreement, in
the event a Change in Control occurs, the performance of the Company’s
obligations under this Section 7 shall be secured by amounts deposited or to be
deposited in trust pursuant to certain trust agreements to which the Company
shall be a party, which amounts deposited shall in the aggregate be not less
than $1,000,000, providing that the fees
and expenses of counsel selected from time to time by the Executive pursuant to
Section 7(a) shall be paid, or reimbursed to the Executive if paid by the
Executive, either in accordance with the terms of such trust agreements, or, if
not so provided, on a regular, periodic basis upon presentation by the Executive
to the trustee of a statement or statements prepared by such counsel in
accordance with its customary practices.  Any failure by the Company
to satisfy any of its obligations under this Section 7(b) shall not limit the
rights of the Executive hereunder.  Subject to the foregoing, the
Executive shall have the status of a general unsecured creditor of the Company
and shall have no right to, or security interest in, any assets of the Company
or any Subsidiary.

     

    (c)           The
reimbursement obligations of the Company under Section 7(a) and Section 7(b)
will be subject to the requirements of Section 5(i)(iii).

     

    8.           
 Competitive
Activity; Confidentiality; Nonsolicitation.  d) For a period
ending one year following the Termination Date, if the Executive shall have
received or shall be receiving benefits under Section 4, the Executive shall
not, without the prior written consent of the Company, which consent shall not
be unreasonably withheld, engage in any Competitive Activity; provided that the
foregoing shall not apply if the Termination Date was prior to the Change in
Control and Executive had already commenced such activity.

     

    (b)           During
the Term, the Company agrees that it will disclose to Executive its confidential
or proprietary information (as defined in this Section 8(b)) to the extent
necessary for Executive to carry out his obligations to the
Company.  The Executive hereby covenants and agrees that he will not,
without the prior written consent of the Company, during the Term or thereafter
disclose to any person not employed by the Company, or use in connection with
engaging in competition with the Company, any confidential or proprietary
information of the Company.  For purposes of this Agreement, the term
“confidential or proprietary information” will include all information of any
nature and in any form that is owned by the Company and that is not publicly
available (other than by Executive’s breach of this Section 8(b)) or generally
known to persons engaged in businesses similar or related to those of the
Company.  Confidential or proprietary information will include,
without limitation, the Company’s financial matters, customers, employees,
industry contracts, strategic business plans, product development (or other
proprietary product data), marketing plans, and all other secrets and all other
information of a confidential or proprietary nature.  For purposes of
the preceding two sentences, the term “Company” will also include any Subsidiary
(collectively, the “Restricted
Group”).  The foregoing obligations imposed by this Section
8(b) will not apply (i) during the Term, in the course of the business of and
for the benefit of the Company, (ii) if such confidential or proprietary
information will have become, through no fault of the Executive, generally known
to the public or (iii) if the Executive is required by law to make disclosure
(after giving the Company notice and, to the extent feasible, an opportunity to
contest such requirement).


    
      
         


      

      
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    (c)           The
Executive hereby covenants and agrees that during the Term and for one year
thereafter Executive will not, without the prior written consent of the Company,
which consent shall not unreasonably be withheld, on behalf of Executive
or on behalf of any person, firm or company, directly or indirectly, attempt to
influence, persuade or induce, or assist any other person in so persuading or
inducing, any management employee of the Restricted Group to give up employment
with the Restricted Group, provided the foregoing shall not be violated by
advertising or searches not specifically targeted at the management employees of
the Restricted Group, or serving as a reference.

     

    (d)           Executive
and the Company agree that the covenants contained in this Section 8 are
reasonable under the circumstances, and further agree that if in the opinion of
any court of competent jurisdiction any such covenant is not reasonable in any
respect, such court will have the right, power and authority to excise or modify
any provision or provisions of such covenants as to the court will appear not
reasonable and to enforce the remainder of the covenants as so
amended.  Executive acknowledges and agrees that the remedy at law
available to the Company for breach of any of his obligations under this Section
8 would be inadequate and that damages flowing from such a breach may not
readily be susceptible to being measured in monetary
terms.  Accordingly, Executive acknowledges, consents and agrees that,
in addition to any other rights or remedies that the Company may have at law, in
equity or under this Agreement, upon adequate proof of his violation of any such
provision of this Agreement, the Company will be entitled to immediate
injunctive relief and may obtain a temporary order restraining any threatened or
further breach, without the necessity of proof of actual damage.

     

    9.       
     Employment
Rights.  Nothing expressed or implied in this Agreement will
create any right or duty on the part of the Company or the Executive to have the
Executive remain in the employment of the Company or any Subsidiary prior to or
following any Change in Control.

     

    10.           Withholding of
Taxes.  The Company may withhold from any amounts payable under
this Agreement all federal, state, city or other taxes as the Company is
required to withhold pursuant to any applicable law, regulation or
ruling.

     

    11.           Successors and Binding
Agreement.

     

    (a)           The
Company will require any successor (whether direct or indirect, by purchase,
merger, consolidation, reorganization or otherwise) to all or substantially all
of the business or assets of the Company, by agreement in form and substance
reasonably satisfactory to the Executive, expressly to assume and agree to
perform this Agreement in the same manner and to the same extent the Company
would be required to perform if no such succession had taken
place.  This Agreement will be binding upon and inure to the benefit
of the Company and any successor to the Company, including without limitation
any persons acquiring directly or indirectly all or substantially all of the
business or assets of the Company whether by purchase, merger, consolidation,
reorganization or otherwise (and such successor shall thereafter be deemed the
“Company” for the purposes of this Agreement), but will not otherwise be
assignable, transferable or delegable by the Company.


    
      
         


      

      
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    (b)           This
Agreement will inure to the benefit of and be enforceable by the Executive’s
personal or legal representatives, executors, administrators, successors, heirs,
distributees and legatees.

     

    (c)           This
Agreement is personal in nature and neither of the parties hereto shall, without
the consent of the other, assign, transfer or delegate this Agreement or any
rights or obligations hereunder except as expressly provided in Sections 11(a)
and 11(b).  Without limiting the generality or effect of the
foregoing, the Executive’s right to receive payments hereunder will not be
assignable, transferable or delegable, whether by pledge, creation of a security
interest, or otherwise, other than by a transfer by Executive’s will or by the
laws of descent and distribution and, in the event of any attempted assignment
or transfer contrary to this Section 11(c), the Company shall have no liability
to pay any amount so attempted to be assigned, transferred or
delegated.

     

    12.           Notices.  For
all purposes of this Agreement, all communications, including without limitation
notices, consents, requests or approvals, required or permitted to be given
hereunder will be in writing and will be deemed to have been duly given when
hand delivered or dispatched by electronic facsimile transmission (with receipt
thereof orally confirmed), or five business days after having been mailed by
United States registered or certified mail, return receipt requested, postage
prepaid, or three business days after having been sent by a nationally
recognized overnight courier service such as FedEx, UPS, or Purolator, addressed
to the Company (to the attention of the Secretary of the Company) at its
principal executive office and to the Executive at his address on the books of
the Company, or to such other address as any party may have furnished to the
other in writing and in accordance herewith, except that notices of changes of
address shall be effective only upon receipt.

     

    13.           Governing
Law.  The validity, interpretation, construction and
performance of this Agreement will be governed by and construed in accordance
with the substantive laws of the State of Delaware, excluding any conflicts or
choice of law rule or principle that might otherwise refer construction or
interpretation of this Agreement to the substantive law of another
jurisdiction.

     

    14.           Consent to
Jurisdiction.  Any disputes, litigation, proceedings or other
legal actions by any party to this Agreement in connection with or relating to
this Agreement or any matters described or contemplated in this Agreement may be
instituted in the courts of the State of Delaware or of the United States
sitting in the State of Delaware.  Each party to this Agreement
irrevocably submits to the jurisdiction of the courts of the State of Delaware
and of the United States sitting in the State of Delaware in connection with any
such dispute, litigation, proceeding or other legal action arising out of or
relating to this Agreement.

     

    15.           Validity.  If
any provision of this Agreement or the application of any provision hereof to
any person or circumstances is held invalid, unenforceable or otherwise illegal,
the remainder of this Agreement and the application of  such provision
to any other person or circumstances will not be affected, and the provision so
held to be invalid, unenforceable or otherwise illegal will be reformed to the
extent (and only to the extent) necessary to make it enforceable, valid or
legal.


    
      
         


      

      
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    16.           Miscellaneous.  No
provision of this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing signed by the
Executive and the Company.  No waiver by either party to this
Agreement at any time of any breach by the other contracting party or compliance
with any condition or provision of this Agreement to be performed by such other
party will be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time.  No agreements or
representations, oral or otherwise, expressed or implied with respect to the
subject matter hereof have been made by either party which are not set forth
expressly in this Agreement.  References to Sections are to references
to Sections of this Agreement.

     

    17.           Code Section
409A.  The intent of the parties hereto is that payments and
benefits under this Agreement comply with or be exempt from Code Section 409A
and the regulations and guidance promulgated thereunder (collectively “Section 409A”) and,
accordingly, to the maximum extent permitted, this Agreement shall be
interpreted and administered to be in compliance therewith.  To the
extent that there is a material risk that any payments under this Agreement may
result in the imposition of an additional tax to the Executive under Section
409A, the Company will reasonably cooperate with the Executive to amend this
Agreement such that payments hereunder comply with Section 409A without
materially changing the economic value of this Agreement to either
party.  The Company shall use its best efforts to ensure ongoing
compliance with Section 409A.  Notwithstanding any provision in this
Agreement to the contrary, no payment or benefit that is deferred compensation
for purposes of Section 409A and that is due upon the Executive’s termination of
employment will be paid or provided unless such termination is also a separation
from service (within the meaning of Section 409A).  For purposes of
Section 409A, the Executive’s right to receive any installment payments pursuant
to this Agreement shall be treated as a right to receive a series of separate
and distinct payments.  Whenever a payment under this Agreement
specifies a payment period with reference to a number of days (e.g., “payment shall
be made within 30 days following the date of termination”), the actual date of
payment within the specified period shall be within the sole discretion of the
Company.

     

    18.           Section 409A
Delay.  If the Executive is at the time of his separation from
service (as defined in Section 409A) with the Company (other than as a result of
his death) a “Specified Employee,” as such term is defined under Section 409A
and using the identification methodology selected by the Company from time to
time, then with regard to any payment or the provision of any benefit that is
considered deferred compensation under Section 409A and that is payable on
account of a separation from service shall be delayed until the earlier of his
death or six months after his separation from service (the “Section 409A Delay”)
and shall then be promptly paid to the Executive in a lump sum, together with
interest for the period of delay, compounded annually, equal to the prime rate
(as published in The
Wall Street Journal) and in effect as of the date the payment should
otherwise have been provided, and any remaining payments and benefits due under
this Agreement shall be paid or provided in accordance with the normal payment
dates specified for them herein.


    
      
         


      

      
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    19.           Counterparts.  This
Agreement may be executed in one or more counterparts, each of which shall be
deemed to be an original but all of which together will constitute one and the
same agreement.

     

    20.           Prior
Agreement.  This Agreement amends and restates the Agreement,
dated as of July 28, 2008 (the “Prior Agreement”),
between the Company and the Executive, which Prior Agreement will, without
further action, be superseded as of the date first above
written.


    
      
         


      

      
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    IN
WITNESS WHEREOF, the parties have caused this Agreement to be duly executed and
delivered as of the date first above written.

     

    
      
        
          
            
              	 
      	
                      HARMAN
      INTERNATIONAL

                    
	 
      	
                      INDUSTRIES,
      INCORPORATED

                    
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	By:	
                      /s/ John Stacey

                    
	 
      	
                      Name:

                    	
                      John
      Stacey

                    
	 
      	
                      Title:

                    	
                      Vice
      President and Chief Human Resources Officer

                    
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                      /s/ Herbert K. Parker

                    
	 
      	
                      Herbert
      K.
Parker

                    


            

          

        

      

    


    
      
         


      

      
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    Annex A

     

    Severance
Compensation

     

    (1)           (i)
A lump sum payment in an amount equal to two times the sum of (A) Base Pay (at
the highest rate in effect for any period prior to the Termination Date), plus
(B) Incentive Pay (in an amount equal to not less than the highest aggregate
Incentive Pay earned in any of the three fiscal years immediately preceding the
year in which the Change in Control occurred).

     

    (2)           For
a period of 18 months following the Termination Date (the “Continuation
Period”), the Company will arrange to provide the Executive (and his
dependents) with coverage under the Company’s medical, dental or other health
plan, but only to the extent that the Executive makes a payment to the Company
in an amount equal to the monthly COBRA premium payments on a timely basis
required to maintain such coverage commencing with the first calendar month
following the Termination Date and the Company shall reimburse the Executive on
an after-tax basis for the amount of such premiums, if any, in excess of any
employee contributions necessary to maintain such coverage for the Continuation
Period (the “COBRA
Reimbursement”).  The COBRA Reimbursement shall be subject to
Section 18 and shall be made within 30 days following the date on which
Executive incurs the expense but no later than December 31 of the year following
the year in which Executive incurs the related expense; provided, that in no
event shall the reimbursements or in-kind benefits to be provided by the Company
in one taxable year affect the amount of reimbursements or in-kind benefits to
be provided in any other taxable year, nor shall Executive’s right to
reimbursement or in-kind benefits be subject to liquidation or exchange for
another benefit.

     

    (3)           Outplacement
services for one year after the Termination Date by a firm selected by the
Executive, at the expense of the Company in an amount up to
$50,000.

     

     

    A-1