EXHIBIT 10.3


 


HARDINGE INC.

EMPLOYMENT AGREEMENT

Amendment One Effective January 1, 2009


 


AMENDMENT dated as of January 1, 2009 (the “Amendment”) of an
Employment Agreement dated as of April 1, 1995 (the “Agreement”), between
HARDINGE INC., a New York corporation (the “Company”) and DOUGLAS C. TIFFT (the
“Executive”).


 


WHEREAS, the Company entered into the Agreement as of April 1,
1995 (which Agreement has been periodically renewed according to the terms
thereof) in order to engage the Executive to provide services pursuant to the
terms of the Agreement; and


 


WHEREAS, this Amendment is intended to revise the Agreement effective January 1,
2009 to include provisions intended to comply with final regulations
promulgated under Internal Revenue Code (“Code”) Section 409A and shall be
construed to the extent practicable so as to avoid causing any amounts payable
to the Executive under the Agreement to be includable in his gross income under
Code Section 409A(a)(1).


 


NOW, THEREFORE, in consideration of the covenants and agreements
hereinafter set forth, the parties hereto agree as follows:


 


1.             Section 5.1,
entitled “Termination Without Cause; Resignation for Good Reason” is amended
effective January 1, 2009 to read as follows:


 


5.1.1  Prior to a Change in
Control.  If, prior to the expiration
of the Employment Term, the Executive’s employment is terminated by the Company
without Cause, or the Executive resigns from his employment hereunder for Good
Reason, in either case at any time prior to a Change in Control, the Company
shall continue to pay the Executive the Base Salary (at the rate in effect
immediately prior to such termination) for the greater of (i) 6 months or (ii) the
remainder of the Employment Term (such period being referred to hereinafter as
the “Severance Period”).  The
payments shall occur in installments in the same amount and at the same regular
payment intervals as the Executive’s Base Salary was being paid on January 1,
2009 and such installments shall be deemed a series of separate payments within
the meaning of Treas. Reg. §1.409A-2(b)(2)(iii).  Installments which in the aggregate do not
exceed Executive’s Base Salary payable over 6 months shall be paid in a lump
sum within 60 days following Executive’s termination of employment.  The remaining installments, if any, shall be
paid in regular payment intervals with the first such installment paid on the
first payment date occurring on or after the day following the 6-month
anniversary of the Executive’s termination of employment.  In addition, the Executive shall be entitled
to


 

















 


continue to participate during the Severance Period in all employee
welfare benefit plans that the Company provides and continues to provide
generally to its employees, provided that the Executive is entitled to
continue to participate in such plans under the terms thereof.  The Executive shall have no further right to
receive any other compensation or benefits after such termination or resignation
of employment except as  determined in accordance
with the terms of the employee benefit plans or programs of the Company.  In the event of the Executive’s death during
the Severance Period, Base Salary continuation payments under this Section 5.1.1
shall continue to be made during the remainder of the Severance Period to the
beneficiary designated in writing for this purpose by the Executive or, if no
such beneficiary is specifically designated, to the Executive’s estate.


 


If, during the Severance Period, the Executive breaches his obligations
under Section 8 of this Agreement, the Company may, upon written notice to
the Executive, terminate the Severance Period and cease to make any further payments
or provide any benefits described in this Section 5.1.1.


 


5.1.2        Within
6 Months Following a Change in Control. 
If , prior to the expiration of the Employment Term, the Executive’s employment
is terminated by the Company without Cause, or the Executive terminates his
employment hereunder for Good Reason, in either case within 6 months following
a Change in Control, the Company shall pay to the Executive cash payments equal
to 1.5 times the sum of (i) his Base Salary (at the rate in effect
immediately prior to such termination or, if higher, as in effect immediately prior
to the Change in Control) and (ii) his average annual bonus earned during
the three fiscal years immediately preceding the Change in Control.  The payment based on the Executive’s Base
Salary shall occur in installments in the same amount and at the same regular payment
intervals as the Executive’s Base Salary was being paid on January 1, 2009
and such installments shall be deemed a series of separate payments within the
meaning of Treas. Reg. §1.409A-2(b)(2)(iii). 
Installments which in the aggregate do not exceed Executive’s Base
Salary payable over 6 months shall be paid in a lump sum within 60 days
following Executive’s termination of employment.  The remaining installments shall be paid in regular
payment intervals with the first such installment paid on the first payment
date occurring on or after the day following the 6-month anniversary of the
Executive’s termination of employment. 
The payment based on the Executive’s average annual bonus, which shall
be deemed a separate “payment” within the meaning of Treas. Reg. §1.409A-2(b)(2) from
the payment based on Base Salary, shall be paid in a lump sum within 60 days
following the Executive’s termination of employment.  In addition, the Executive shall be entitled to
continue to participate for a period of three years following such termination
in all employee welfare benefit plans that the Company provides and continues
to provide generally to its executive employees (or, if the Executive is not
entitled to participate in any such plan under the terms thereof, in a comparable
substitute arrangement provided by the Company) provided, however, that for the
first six months following the Executive’s termination of employment, the
Executive shall pay the premiums of any welfare benefit plans to the extent
that the payment of such premiums by the Company would have constituted gross
income to the Executive.  The Company
shall reimburse 


 


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the Executive for any premiums or other expenses incurred by the
Executive with respect to his participation and that of any of his dependents
in any such employee benefit welfare plan.


 


5.1.3        After
6 Months Following a Change in Control. 
If, prior to the expiration of the Employment Term, the Executive
resigns from his employment for any reason at any time later than six months
following a Change in Control, the Company shall pay to the Executive a lump
sum cash payment equal to 1.5 times the sum of (i) his Base Salary (at the
rate in effect immediately prior to such termination or, if higher, as in
effect immediately prior to the Change in Control) and (ii) his average
annual bonus earned during the three fiscal years immediately preceding the
Change in Control.  The payment based on
the Executive’s Base Salary shall occur in installments in the same amount and
at the same payment intervals as the Executive’s Base Salary was being paid on January 1,
2009 provided, however, that no such installment shall be paid before the day
following the 6-month anniversary of the Executive’s termination of
employment.  The payment based on the
Executive’s average annual bonus, which shall be deemed a separate “payment”
within the meaning of Treas. Reg. §1.409A-2(b)(2) from the payment based
on Base Salary, shall be paid in a lump sum on the day following the 6-month
anniversary of the Executive’s termination of employment.  In addition, the Executive shall be entitled
to continue to participate for a period of three years following such
termination in all employee welfare benefit plans that the Company provides and
continues to provide generally to its executive employees (or, if the Executive
is not entitled to participate in any such plan under the terms thereof, in a
comparable substitute arrangement provided by the Company) provided, however,
that for the first six months following the Executive’s termination of
employment, the Executive shall pay the premiums of any welfare benefit plans
to the extent that the payment of such premiums by the Company would have
constituted gross income to the Executive. 
The Company shall reimburse the Executive for any premiums or other
expenses incurred by the Executive with respect to his participation and that
of any of his dependents in any such employee benefit welfare plan.


 


2.             Section 5.4,
entitled “Good Reason” is amended effective January 1, 2009 to read as
follows:


 


5.4           Good
Reason.  For purposes of this
Agreement, “Good Reason” shall mean the occurrence of one or more of the
following events provided that, the Executive shall give the Company a written
notice, within 90 days following the initial occurrence of the event,
describing the event that the Executive claims to be Good Reason and stating
the Executive’s intention to terminate employment unless the Company takes
appropriate corrective action:


 


(i)            a material decrease in the Executive’s Base
Salary or a failure by the Company to pay material compensation due and payable
to the Executive in connection with his employment;


 


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(ii)           the Company’s failure to assign to the
Executive duties that are generally consistent with the Executive’s position
and title;


 


(iii)          a material diminution in benefits provided by
the Company to the Executive except for a diminution applicable to
substantially all of the Company’s senior executives;


 


(iv)          the Company’s requiring the Executive to relocate
to an office or location more than 50 miles from the Company’s facilities in
Elmira, New York;


 


(v)           a failure or refusal of any successor
company to assume the Company’s obligations under this Agreement; or


 


(vi)          the Company’s material breach of any material
term of this Agreement.


 


The Company shall have 30 days from the date of receipt of the written
notice from the Executive stating his claim of Good Reason in which to take
appropriate corrective action.  If the
Company does not cure the Good Reason, the Good Reason will be deemed to have
occurred at the end of the 30-day period. 
This section shall apply with respect to any successor of the Company
following a Change in Control as if such successor were the Company.


 


IN WITNESS WHEREOF, the Company has caused this Amendment of the Agreement
to be duly executed and the Executive has hereunto set his hand, as of the day
and year first above written.


 


	
   

  	
  HARDINGE INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
    /S/  RICHARD L.
  SIMONS

  
	
   

  	
  Name:  Richard L. Simons

  
	
   

  	
  Title:  President and CEO

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
    /S/  DOUGLAS C. TIFFT

  
	
   

  	
  Douglas C.
  Tifft

  	
   

  
				



 


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