Document:

exv10w19

Exhibit 10.19

SEVERANCE AGREEMENT

     THIS SEVERANCE AGREEMENT (“Agreement”) is entered into as of the 7th day of
November, 2005, by and between OM Group, Inc., a Delaware corporation (the “Company”) and Valerie
Gentile Sachs, an executive officer of the Company (the “Executive”).

     WHEREAS, the Company wishes to assure itself of the continuity of the Executive’s services;
and

     WHEREAS, the Company and the Executive accordingly desire to enter into this Agreement on the
terms and conditions set forth below;

     NOW, THEREFORE, in consideration of the premises and mutual covenants set forth herein, it is
hereby agreed by and between the parties as follows:

     1.
     
Term of Agreement. The “Term” of this Agreement shall
commence on the date hereof and end on the third (3rd) anniversary of the date hereof;
provided, however, that the Compensation Committee of the Board of Directors may extend the Term in
one year increments. Notwithstanding the foregoing, this Agreement shall terminate automatically
in the event that any payment is made pursuant to Sections 5(c)-(g) of the Change in Control
Agreement between the Executive and the Company dated October 11, 2005.

     2.       Termination. (a) For purposes of this Agreement, “Termination”
shall mean: (i) termination of the employment of the Executive by the Company during the Term, for
any reason other than death, Disability (as defined below), or Cause (as described below), (ii) the
assignment of any duties inconsistent with the Executive’s position (including status, offices,
titles and reporting requirements), authority, duties or responsibilities, or any other action by
the Company which results in a diminution in such position, authority, duties or responsibilities,
excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith
and which is remedied by the Company promptly after receipt of notice thereof given by Executive or
(iii) a material change in the Executive’s reporting structure, including such change as would
result from the resignation or termination of Joseph M. Scaminace as Chief Executive Officer of
the Company. Resignation by the Executive for any other reason shall not be
treated as a “Termination” under this Agreement.

     (b)       For purposes of this Agreement, “Disability” shall mean that the Executive is physically
or mentally incapacitated for a period of one hundred eighty (180) consecutive days such that the
Executive cannot substantially perform the Executive’s duties of employment with the Company on a
full-time basis.

     (c)       For purposes of this Agreement, “Cause” shall mean (i) commission of a felony by the
Executive (other than felonious operation of a motor vehicle), (ii) fraud, embezzlement or
misappropriation of funds, in each case involving or against the Company or any of its subsidiaries
or affiliates, (iii) an act or series of acts of dishonesty in the course of employment that are
materially inimical to the best interests of the Company or a subsidiary and, if the act or acts
are capable of being cured, the Executive fails to cure or take all reasonable steps to cure

 

 

within 30 days of notice from the Company to the Executive, and (iv) other than for
Disability, the Executive abandons and consistently fails to attempt to perform her duties and
responsibilities for 30 consecutive days after the Company has advised her in writing of that
failure.

     3.       Termination date and notice. Any notice of Termination of the
Executive’s employment by the Company or the Executive for any reason under Section 2 above shall
be upon no less than fifteen (15) days’ advance written notice (“Notice of Termination”). The date
of termination shall be the date specified by the Company or the Executive in the Notice of
Termination (“Date of Termination”). Any notices, requests, demands and other communications
provided for by this Agreement shall be sufficient if in writing and if personally delivered or
sent by registered or certified mail or by prepaid overnight courier to the Executive at the last
address the Executive has filed in writing with the Company or, in the case of the Company, to the
attention of the Secretary of the Company, at its principal executive offices.

     4.       Severance benefits. In the event of a
Termination described in Section 2 above, the Company shall pay to the Executive as severance pay,
in a lump sum, the following amounts:

	 	(a)	 	the Executive’s full base salary earned through the Termination
Date at the rate in effect prior to the date Notice of Termination is given, to
the extent not theretofore paid;
	 
	 	(b)	 	an amount equal to Executive’s annual base salary in effect
prior to the date Notice of Termination is given;
	 
	 	(c)	 	the Executive’s bonus for the previously completed fiscal year
of the Company, to the extent not theretofore paid; and
	 
	 	(d)	 	the Executive’s target bonus (i.e. based on achievement of
performance goals at the 100% level) for the fiscal year in which the Notice of
Termination was given.

     The payments described in this Section 4 shall be payable on or before the tenth
(10th) day following the Termination Date pursuant to the Company’s normal payroll
practices, provided that the Executive executes a general release, which shall be in a form
mutually satisfactory to the Company and Executive and which shall include provisions that are
customary for a general release, including (i) provisions addressing the Executive’s release of the
Company from any future liability or suit, (ii) provisions addressing nonsolicitation of other
Company Executives and confidentiality, (iii) a six-month noncompete agreement pursuant to which
Executive shall agree not to acquire any financial or beneficial interest in, be employed by, or
own, manage, operate or control any entity (A) which is primarily engaged in any type of business
in which either the Company or its subsidiaries have been actively engaged, and (B) for which the
Executive has primary responsibility to act as general counsel immediately prior to the Termination
Date, (iv) provisions addressing nondisparagement of the Company and its officers, directors,
employees and agents; provided that the Company shall make a reciprocal

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commitment not to disparage the Executive, and (v) the waiver of continued participation in
any employee benefit or welfare plans.

     5.       Withholding. All payments to the Executive under this
Agreement will be subject to all applicable withholding of state and federal taxes.

     6.       Non-Alienation. The Executive shall not have any right
to pledge, hypothecate, anticipate or in any way create a lien upon any amounts provided under this
Agreement; and no amounts payable hereunder shall be assignable in anticipation of payment either
by voluntary or involuntary acts, or by operation of law. Nothing in this Section 6 shall limit
the Executive’s rights or powers to dispose of the Executive’s property by Last Will and Testament
or limit any rights or powers which the Executive’s executor or administrator would otherwise have.
This Agreement shall inure to the benefit of and be enforceable by the Executive’s personal or
legal representatives, executors, administrators, successors, heirs, designees, devisees and
legatees. If the Executive should die while any amount is still payable to the Executive hereunder
had the Executive continued to live, all such amounts shall be paid in accordance with the terms of
this Agreement to the Executive’s designated beneficiary or beneficiaries (pursuant to a written
beneficiary designation signed, dated, and delivered to the Company prior to the Executive’s
death), or if there are no beneficiaries, to the Executive’s estate.

     7.       Amendment. This Agreement may be amended or canceled
by mutual agreement of the parties in writing without the consent of any other person, and so long
as the Executive lives, no person, other than the parties hereto, shall have any rights under or
interest in this Agreement or the subject matter hereof.

     8.       Successors. This Agreement shall be binding upon and
inure to the benefit of the Company and any successor of the Company.

     9.       Employment Status. Nothing herein shall be deemed to
create an employment agreement between the Company and the Executive providing for the employment
of the Executive by the Company for any fixed period of time. The Executive’s employment with the
Company is terminable at will by the Company or the Executive, and each shall have the right to
terminate the Executive’s employment with the Company at any time, with or without Cause, subject
to (i) the notice provisions of this Agreement, and (ii) the Company’s obligation to provide
severance benefits if and as required by Section 4.

     10.       Severability. In the event that any provision or
portion of this Agreement shall be determined to be invalid or unenforceable for any reason, the
remaining provisions of this Agreement shall be unaffected thereby and shall remain in full force
and effect.

     11.       Counterparts. This Agreement may be
executed in one or more counterparts, each of which shall be an original but all of which together
shall constitute one and the same document.

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     IN WITNESS WHEREOF, the Company and the Executive have executed this Agreement as of the day and
year first above written.

	 	 	 	 	 
	 	 	COMPANY:
	 
	 	 	 	 
	 	 	OM GROUP, INC.
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 	 	Title:
	 
	 	 	 	 
	 	 	EXECUTIVE:
	 
	 	 	 	 
	 	 	 
	 	 	Valerie Gentile Sachs

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Exhibit 10.20

Form of Non-Incentive Stock Option Agreement

OM GROUP, INC.

1998 LONG-TERM INCENTIVE COMPENSATION PLAN

STOCK OPTION AGREEMENT

     THIS STOCK OPTION AGREEMENT, dated as of                      (being the date this option is granted)
by and between OM GROUP, INC. (the “Company”), and                      (the “Participant”), a Key
Employee of the Company or a subsidiary of the Company, is to evidence the non-incentive stock
option granted to the Participant as described herein. Capitalized terms used herein and not
otherwise defined have the meaning ascribed to them in the 1998 Long-Term Incentive Compensation
Plan of the Company, as adopted by the shareholders on May 5, 1998, and as it may be amended (the
“Plan”).

WITNESSETH

     That the parties hereto agree as follows:

     Section 1. The Company hereby grants to the Participant the option of purchasing the number
of shares of Common Stock of the Company at the option exercise price and subject to the terms and
conditions hereinafter set forth.

     Section 2. The aggregate number of shares of Common Stock purchasable is                     .

     Section 3. The option exercise price is $                     per share.

     Section 4. Except as otherwise provided in Sections 5, 6, 7, 8, 9, 10 and 12, the option
rights granted hereunder shall become exercisable in three equal installments on the first, second
and third annual anniversaries of the date of this option grant as set forth above.

     Section 5. This option shall become exercisable as to all of the shares it covers upon the
occurrence of any Change in Control of the Company (as defined in the Plan) occurring within the
option period specified in Section 11; provided that this option shall not be exercisable prior to
the expiration of six months from the date of grant.

     Section 6. To the extent not otherwise exercisable at the date of the retirement of the
Participant in accordance with a retirement plan or policy of the Company or any subsidiary, this
option shall become fully exercisable upon such retirement, and the Participant may exercise the
option rights set forth herein at any time within three years following such retirement (but only
within the option period specified in Section 11).

     Section 7. If the Participant shall die while still employed by the Company or any
subsidiary, this option shall become fully exercisable to the extent not otherwise exercisable, and
the person entitled by will or the applicable laws of descent and distribution may exercise the

 

 

option rights set forth herein at any time within one year following the Participant’s death
(but only within the option period specified in Section 11).

     Section 8. If the Participant ceases to be employed by the Company or a subsidiary due to the
permanent and total disability of the Participant, this option shall become fully exercisable to
the extent not otherwise exercisable, and the Participant may exercise the option rights set forth
herein at any time within the one-year period following the date of the Participant’s cessation of
employment (but only within the option period set forth in Section 11).

     Section 9. If the Participant shall die following the cessation of employment with the
Company or a subsidiary but within the periods provided for in Sections 6 or 8, this option shall
become fully exercisable to the extent not otherwise exercisable, and the person entitled by will
or applicable laws of descent and distribution may exercise the option rights set forth herein at
any time within one year following the Participant’s death (but only within the option period set
forth in Section 11).

     Section 10. If the Participant ceases to be employed by the Company or a subsidiary for any
reason other than retirement, permanent and total disability, or death, the Participant may
exercise the option rights set forth herein at any time within the three-month period following
such cessation of employment (but only within the option period specified in Section 11) to the
extent the Participant was entitled to exercise the same immediately prior to such cessation of
employment; provided, however, if there has been a Change in Control of the Company and the
Participant’s employment with the Company shall have terminated after such Change in Control and
prior to six months from the date of grant of this option, then this option may be exercised in
whole or in part at any time within the three-month period commencing six months from the date of
grant of this option.

     Section 11. Notwithstanding any other provisions hereof, this option shall not be exercisable
after                                         .

     Section 12. Notwithstanding any other provisions hereof, if the Participant’s employment with
the Company or a subsidiary is terminated on account of a violation of the Company’s Code of
Conduct and Ethics, this option shall be forfeited upon such termination to the full extent not
exercised at the time of such termination.

     Section 13. This option is not transferable by the Participant otherwise than by will or by
the laws of descent and distribution, and is exercisable, during the lifetime of the Participant,
only by the Participant or the Participant’s guardian or legal representative. Upon any attempt to
transfer, assign, pledge, hypothecate, or otherwise dispose of this option or the related option
rights contrary to the provisions of this Agreement, or upon the levy of any attachment or similar
process upon such option or rights, such option and rights shall immediately become null and void.

     Section 14. If the Participant’s exercise of this option is prevented by the terms of
subsections (a), (b) or (c) of Section 18 and the Participant’s option terminates pursuant to
Section 6, 8 or 9, then the Participant may, notwithstanding the provisions of Section 6, 8 or 9
but only within the period set forth in Section 11, exercise such option to the extent it would
have been exercisable immediately prior to its termination but for the operation of Section 18 at

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any time within 30 days after such Participant is notified by the Company that such exercise
is no longer prevented by Section 18.

     Section 15. In the event that at any time prior to the expiration of this option each of the
outstanding shares of Common Stock of the Company (except shares held by dissenting stockholders)
shall be changed into or exchanged for a different number or kind of shares of stock or other
securities of the Company or of another corporation, whether through reorganization,
recapitalization, stock split-up, combination of shares, merger or consolidation, then for all
purposes of this option there shall be substituted for each share of Common Stock purchasable
hereunder the number and kind of shares of stock or other securities into which each such share of
Common Stock of the Company shall be so changed, or for which each such share shall be so
exchanged, and the shares or securities so substituted for each such share of Common Stock shall be
subject to purchase at an appropriately adjusted option exercise price and subject to the terms and
conditions hereof.

     In the event that the Company shall issue a stock dividend in Common Stock with respect to the
Common Stock of the Company, the number of shares then purchasable hereunder shall be adjusted by
adding to each such share the number of shares which would have been distributed as a stock
dividend thereon had such share been outstanding on the record date for payment of the stock
dividend, and each such share together with said additional shares shall be purchasable at the
option exercise price as above provided and as may be appropriately adjusted.

     In the event that there shall be any other change in the number or kind of outstanding shares
of Common Stock or other securities of the Company, or of any shares of stock or other securities
into which such shares of Common Stock shall have been changed or for which they shall have been
exchanged, or the Company shall make an Extraordinary Distribution or a Prorata Repurchase, then
the Compensation Committee shall make such adjustment in the number or kind of shares of stock or
other securities covered by this option and in the number or kind of shares of stock or other
securities subject to purchase at the option exercise price as above provided and with any such
adjustment in the option exercise price to reflect the effect of such Extraordinary Distribution or
Prorata Repurchase as the Compensation Committee, in its sole discretion may determine is equitably
required by such change, and such adjustment so made shall be effective and binding for all
purposes of this option.

     Anything to the contrary herein contained notwithstanding, the Participant shall not be
entitled to purchase a fraction of a share under this option.

     Section 16. If the Company shall liquidate or dissolve, or shall be a party to a merger or
consolidation with respect to which the Company shall not be the surviving corporation, the Company
shall give written notice thereof to the Participant at least 30 days prior thereto. The
Participant shall have the right within said 30-day period (but only within the period specified in
Section 11) to exercise this option to the extent such Participant was entitled to exercise the
option on the date of the notice; provided, however, that if the Participant is employed by the
Company on the date of the notice, then notwithstanding the provisions of Section 4, the
Participant shall have the right to exercise this option in full to the extent not previously
exercised. To the extent that this option shall not have been exercised on or prior to the
effective date of such liquidation, dissolution, merger or consolidation, then notwithstanding any
other provisions hereof, it shall terminate on said date, unless it is assumed by another
corporation

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within the meaning of Section 425(a) of the Internal Revenue Code of 1986, as amended.

     Section 17. Subject to the terms and conditions hereof, this option may be exercised in whole
or in part by delivering to the Company at its principal place of business a written notice, signed
by the person entitled to exercise the option, of the election to exercise the option and stating
the number of shares to be purchased. Such notice shall, as an essential part thereof, be
accompanied by the payment of the full option exercise price of the shares then to be purchased,
except as provided below. Payment of the full option exercise price may be made, at the election
of the Participant, in (a) cash, (b) Common Stock of the Company, or (c) any combination of cash or
Common Stock of the Company; provided, however, that the Participant may not use Common Stock of
the Company in payment of the purchase price unless such Common Stock has been held by the
Participant for at least six months. A Participant using Common Stock of the Company to pay the
purchase price of shares being purchased may do so either by actual delivery of share certificates
for such Common Stock or by attesting as to the ownership of such Common Stock. Shares of Common
Stock used in payment of the purchase price shall be valued at their closing price on the New York
Stock Exchange on the trading day immediately preceding the date of exercise. The Participant may
elect to pay the purchase price upon the exercise of this option by authorizing a third party to
sell all the shares (or a sufficient portion of the shares) acquired upon the exercise of the
option and to remit to the Company a sufficient portion of the sale proceeds to pay the entire
purchase price and any tax withholding resulting from such exercise. Upon the proper exercise of
this option, the Company shall issue in the name of the person exercising the option, and deliver
to such person, a certificate or certificates for the shares purchased, provided that if any
applicable law or regulation requires the Company to take any action with respect to the shares
specified in such notice before the issuance thereof, the date of delivery of such shares shall be
extended for the period necessary to take such action. The Participant agrees that as holder of
this option, the Participant shall have no rights as a stockholder or otherwise in respect of any
of the option shares until the option is effectively exercised as herein provided. The Participant
agrees to pay in cash, within the time period specified by the Company, the amount (if any)
required to be withheld for federal, state and local tax purposes on account of the exercise of the
option or to make such arrangements to satisfy such withholding requirements as the Company deems
appropriate.

     Section 18. This option shall not be exercisable if such exercise would violate:

	 	(a)	 	Any applicable state securities law;
	 
	 	(b)	 	Any applicable registration or other requirements under the Securities Act of
1933, as amended (the “Act”), the Securities Exchange Act of 1934, as amended, or
applicable listing requirements of any stock exchange; or
	 
	 	(c)	 	Any applicable legal requirement of any other governmental authority.

     The Company agrees to make reasonable efforts to comply with the foregoing laws and
requirements so as to permit the exercise of this option. Furthermore, if a registration statement
with respect to the shares to be issued upon the exercise of this option is not in effect or if
counsel for the Company deems it necessary or desirable in order to avoid possible violation of the
Act, the Company may require, as a condition to its issuance and delivery of certificates for the
shares, the delivery to the Company of a commitment in writing by the person exercising the option
that at the time of such exercise it is such person’s intention to acquire such shares for

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such person’s own account for investment only and not with a view to, or for resale in
connection with, the distribution thereof; that such person understands the shares may be
“restricted securities” as defined in Rule 144 of the Securities and Exchange Commission; and that
any resale, transfer or other disposition of said shares will be accomplished only in compliance
with Rule 144, the Act, or the other rules and regulations thereunder. The Company may place on
the certificates evidencing such shares an appropriate legend reflecting the aforesaid commitment
and the Company may refuse to permit transfer of such certificates until it has been furnished
evidence satisfactory to it that no violation of the Act or the rules and regulations thereunder
would be involved in such transfer.

     Section 19. This Agreement is subject to the terms of the Plan. If there is any
inconsistency between this Agreement and the Plan, the Plan shall govern.

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement in duplicate as of the day
and year first above written.

	 	 	 	 	 	 	 	 	 	 	 
	“PARTICIPANT”	 	 	 	OM GROUP, INC.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 
	 	By:
	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	Title:

	 	 	 	 
	 	Title:
	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 

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