Document:

AFL 306 10-Q EXH 10.32

Aflac Incorporated 1st Quarter 2006 Form 10-Q

EXHIBIT 10.32

EXHIBIT "P"

RESOLUTION

Aflac Incorporated Board

February 14, 2006

     WHEREAS the intent of the 2004 AFLAC Incorporated Long-Term Incentive Plan (the "Plan") was to settle all equity awards, including Options and Stock Appreciation Rights, in shares of Company Stock; and

     WHEREAS Section 3 (d) of the Plan allows in certain circumstances for the settlement of an Option or Stock Appreciation Right in cash;

     IT IS HEREBY RESOLVED, that the Plan be amended and Section 3 (d) Substitution for Awards be replaced with the following paragraph that clarifies that all Company equity awards, including Options and Stock Appreciation Rights, be settled in shares of Company Stock:

     Substitution for Awards.  In the event of (i) a liquidation of the Company, (ii) a reorganization, merger, or consolidation of the Company as a result of which the outstanding Company Stock is changed into or exchanged for cash or property or securities not of the Company's issue, (iii) a sale, exchange, or transfer of all or substantially all of the property of the Company, or one of its business units, to another person or corporation, or (iv) the direct or indirect acquisition of all or substantially all of the outstanding voting shares of the Company by another person, corporation or other entity, the Board of Directors may, in its sole discretion, arrange with the surviving entity, continuing successor, or purchasing corporation or other entity or parent thereof, as the case may be (the "Acquiring Entity"), for the Acquiring Entity to assume the Company's rights and obligations under outstanding Awards or substitute Awards based on the Acquiring Entity's stock for such outstanding Awards.  To the extent the Acquiring Entity elects not to assume the Company's rights and obligations under or substitute for such outstanding Awards, each such Award, including but not limited to Options or Stock Appreciation Rights, shall become fully exercisable and free of restrictions, as applicable, as of a date prior to such corporate transaction, as the Board so determines. Any Options or Stock Appreciation Rights which are neither assumed or substituted for by the Acquiring Corporation in connection with the corporate transaction nor exercised as of the date of the corporate transaction shall terminate and cease to be outstanding effective as of the date of the consummation of the corporate transaction.

 

EXH 10.32-1ADM 8-K Andreas Transition Agreement

    
      

    

    
      

    

    TRANSITION
      AGREEMENT

     

    

    TRANSITION
      AGREEMENT
      (“Agreement”), dated as of May 5, 2006 between Archer
      Daniels Midland Company,
      a
      Delaware corporation (the “ADM”), and G.
      Allen Andreas (“Executive”),
      a citizen of the State of Illinois.

     

    WHEREAS
      Executive
      has been employed by ADM in the capacity of Chief Executive Officer (“CEO”) and
      President; and

     

    WHEREAS
      Executive
      has served ADM as a Director and as the Chairman of the Board of Directors
      (“Chairman”); and 

     

    WHEREAS
      Executive
      and ADM have agreed that Executive will resign as CEO and President and will
      continue to serve as Director and Chairman; and

     

    WHEREAS
      the
      parties wish to provide for an orderly transition of Executive’s duties and
      responsibilities as CEO and President, and to document the terms and conditions
      pertaining to his continuing duties and responsibilities as a Director and
      as
      Chairman;

     

    NOW,
      THEREFORE,
      in
      consideration of the mutual promises and agreements set forth herein, and other
      good and valuable consideration, the receipt of which are hereby acknowledged,
      ADM and Executive hereby agree as follows:

     

    Section 1.  Resignation
      as CEO and President.
      Executive hereby resigns as CEO and President effective May 1, 2006, and from
      all of his officer positions with ADM; and Executive will resign as an officer
      or representative of ADM for any affiliate of ADM and all boards of directors
      of
      such affiliates, or for which Executive serves as ADM’s representative, and
      agrees to execute and deliver any and all further documentation reasonably
      requested by ADM in order to evidence and effect such resignation(s), as
      requested by the CEO or the Board. Upon such resignation(s), Executive shall
      remain an employee of ADM, as well as a Director and Chairman. 

     

    Section 2.  Continued
      Employment as Chairman.
      Following Executive’s resignation as CEO and President, and prior to his
      Retirement Date (as defined in Section 3 below)(assuming Executive’s reelection
      as a Director of ADM), to secure Executive’s continued services for ADM, the
      other terms and conditions of Executive’s employment (including his current base
      salary of $3,060,000) shall remain the same as in effect on the date of this
      Agreement through August 31, 2006 (including Executive’s receipt of his normal
      equity incentive award for fiscal year 2006); provided, however, that Executive
      shall not be eligible for equity incentive awards after the August 2006 grant
      related to ADM’s fiscal year 2006. Thereafter, in lieu of his current base
      salary, Executive will be paid at the rate of $1,000,000 per annum for his
      services as Chairman (“Chairman Compensation”), and Executive will be provided
      with office and secretarial support similar to his current arrangements at
      a
      location to be mutually agreed between the parties. Executive will also be
      provided with air and ground transportation while on ADM business, and access
      to
      existing corporate lodging in New York City and Washington, D.C. while on ADM
      business, similar to his current arrangements. While Executive remains Chairman,
      he shall perform such normal and customary duties as Director and Chairman
      and
      fulfill such other roles in those capacities for ADM as may be reasonably agreed
      between the Executive and the Board, and shall otherwise continue his normal
      duties and obligations (including his duty of loyalty) as an employee of
      ADM.

    
      
        
        

      

      
        
          

        

      

       

    

    Section 3.  Retirement
      as Chairman.
      After
      September 1, 2006, for the remainder of ADM’s 2007 fiscal year, upon any date
      that a majority of the Board or ADM’s shareholders determine, Executive will
      retire and resign as a Director and as Chairman (the “Retirement Date”). After
      the conclusion of ADM’s 2007 fiscal year, upon any date that Executive, a
      majority of the Board or ADM’s shareholders determine, Executive will retire and
      resign as a Director (assuming Executive’s reelection as a Director of ADM) and
      as Chairman (then the “Retirement Date”), and Executive agrees to execute and
      deliver any and all further documentation reasonably requested by ADM in order
      to evidence and effect the retirement. If Executive’s Retirement Date is prior
      to July 1, 2008, he shall remain an employee of ADM until the close of business
      on June 30, 2008, and shall be available (consistent with his outside
      obligations) to provide such services to the Board and the CEO as shall be
      reasonably agreed between Executive and the Board. In any event, and regardless
      of whether Executive remains Chairman, Executive shall cease to be an employee
      of ADM at the close of business on June 30, 2008.

     

    Section 4.  Payments.
      Upon
      Executive’s retirement, ADM shall provide Executive with the following payments
      and benefits:

     

    (a)  Continued
      Chairman Compensation.
      If the
      Retirement Date is prior to September 1, 2009, Executive shall continue to
      receive his Chairman Compensation until September 1, 2009; provided, however,
      that if Executive voluntarily elects to retire and resign as a Director and
      Chairman prior to July 1, 2007, he shall not receive Chairman Compensation
      after
      his Retirement Date, and he shall forfeit any unvested equity awards as of
      his
      Retirement Date that were granted under ADM’s equity plans other than ADM’s 2002
      Incentive Compensation Plan, but he shall receive the remainder of the benefits
      described in this Agreement. Such Chairman Compensation shall be paid in
      accordance with ADM’s regular payroll cycles and in a manner consistent with the
      requirements of Section 409A of the Internal Revenue Code of 1986, as amended
      (the “Code”). If the Retirement Date is on or after September 1, 2009, Executive
      shall not receive any Chairman Compensation after his Retirement
      Date.

     

    (b)  Equity
      Awards.
      Upon
      Executive’s Retirement Date, Executive shall continue to vest in his outstanding
      equity awards as provided in this paragraph. With respect to awards granted
      under the terms of ADM’s 2002 Incentive Compensation Plan (including the normal
      August 2006 award), Executive’s retirement shall conclusively be deemed to be
      pursuant to “Retirement,” as such term is used in Executive’s various stock
      award and stock option agreements. With respect to awards granted under other
      equity plans, subject to Executive’s full compliance with Section 5 below, such
      awards shall continue to vest in accordance with their regular vesting
      schedules, and any awards that have not previously vested on September 1, 2009
      shall become fully vested on that date. In addition, any vested options shall
      remain exercisable as if Executive remained employed until
      the
      end of the original term (or such shorter period of time as is necessary so
      that
      such options are not subject to the tax imposed by Code Section 409A). To the
      extent any equity awards under ADM’s equity plans other than ADM’s 2002
      Incentive Compensation Plan cannot be fully vested and Executive is otherwise
      entitled to have them vested under the terms of this Agreement, ADM will pay
      to
      Executive the cash value of such awards (including the spread between the option
      price and the current fair market value of ADM’s stock) on the later of the date
      when such award would otherwise have become vested or the first date on which
      such payment would not be subject to the tax imposed by Code Section 409A.

    
      
        
        

      

      
        
          

        

      

       

    

    (c)  Benefits.

     

    (i)  Executive
      shall receive any and all benefits accrued under any deferred compensation
      or
      qualified or non-qualified pension plan in which he currently participates
      (other than any severance plan) in accordance with, and subject to, the
      terms thereof; provided that no such deferred compensation or non-qualified
      pension benefits shall be paid prior to the first date on which they would
      not
      be subject to the tax imposed by Code Section 409A. 

     

    (ii)  If
      Executive’s Retirement Date is prior to July 1, 2008, Executive and his family
      shall be entitled to continued participation as an employee in all medical,
      health and life insurance plans at the same benefit level at which Executive
      and
      his family were participating on the Retirement Date until the earlier of (A)
      July 1, 2008, or (B) the date, or dates, Executive receives substantially
      similar coverage and benefits under the plans and programs of a subsequent
      employer (such coverage and benefits to be determined on a coverage-by-coverage,
      or benefit-by-benefit, basis). Such coverage shall be determined as if Executive
      had continued to be an active employee of ADM, and ADM shall continue to pay
      the
      costs of such coverage under such plans on the same basis as is applicable
      to
      active employees covered thereunder; provided that, if participation in any
      one
      or more of such plans is not possible under the terms thereof, ADM shall provide
      substantially identical benefits or, at Executive’s election, reimburse
      Executive for his cost of obtaining comparable coverage from a third-party
      insurer. In any event, Executive and his eligible dependents shall be eligible
      to participate in ADM’s retiree welfare benefits program.

     

    (iii)  If
      Executive’s Retirement Date is prior to July 1, 2008, Executive shall be
      credited with service and age credits as an employee under ADM’s supplemental
      retirement plans until July 1, 2008, and Executive may commence benefits on
      July
      1, 2008 in any form permitted by the applicable retirement plan as of the date
      of this Agreement. If Executive’s Retirement Date is on or after July 1, 2008,
      Executive may commence benefits upon his Retirement Date (or the first date
      on
      which payment of such benefits would not be subject to tax imposed by Code
      Section 409A) in any form permitted by the applicable retirement plan as of
      the
      date of this Agreement.

     

    (iv)  If
      Executive’s Retirement Date is prior to July 1, 2008, Executive shall, until
      July 1, 2008, receive office and secretarial support similar to his current
      arrangements at a location to be mutually agreed upon by the parties. If
      Executive’s Retirement Date is on or after July 1, 2008, he shall not receive
      office and secretarial assistance after his Retirement Date.

    
      
        
        

      

      
        
          

        

      

       

    

    (v)  Executive
      shall be reimbursed for the reasonable legal and professional fees incurred
      by
      him for the negotiation and documentation of this Agreement.

     

    (vi)  Executive
      shall be paid for any (A) base salary (at the rate of salary in effect
      immediately prior to the Retirement Date) to the extent earned but unpaid as
      of
      the Retirement Date, (B) accrued but unused vacation days and (C) reasonable
      business and fringe benefit expenses incurred by him prior to the Retirement
      Date in accordance with Company policy in effect on the Retirement Date which
      have not yet been reimbursed. Such payment shall be made in accordance with
      ADM’s standard payroll and expense reimbursement practices.

     

    Section 5.  Covenant
      Not To Compete.
      Executive acknowledges and agrees that he has, from time to time, executed
      Non-Disclosure Agreements with ADM which continue in full force and effect
      during the period of his employment and thereafter by their terms, and further
      acknowledges and agrees that during his tenure as CEO Executive had direct
      access to and personal knowledge of ADM’s most important proprietary business
      information including, but not limited to, business plans and strategies,
      financial information, trading and hedging strategies, and operational methods,
      plans and strategies. This information is proprietary to ADM and subject to
      reasonable efforts by ADM to secure its confidentiality. This proprietary
      information has significant value to ADM as it provides ADM with a strategic
      advantage over its Competitors (as defined below). Were this information
      provided to ADM’s Competitors, or were Executive to be engaged by ADM’s
      Competitors, since Executive would not be unable to perform his duties for
      such
      Competitors without disclosing ADM’s confidential and proprietary business
      information, ADM would be irreparably harmed. Therefore, beginning on
      Executive’s Retirement Date and continuing until September 1, 2009, Executive
      shall not, without the prior written consent of the Board of Directors of ADM,
      which consent shall not be unreasonably withheld, own any interest in, except
      the ownership of stock in a publicly-traded company, take any employment with,
      or act as a director, officer, agent, consultant, advisor, independent
      contractor or in any other capacity whatsoever, directly or indirectly, with
      or
      to any any entity that would compete with any of the material businesses of
      ADM
      (“Competitors”). As further consideration for Executive’s agreement to forego
      such opportunities, ADM will pay Executive $1,000,000 on September 1, 2009
      provided that Executive is then in full compliance with the provisions of this
      Section 5. In the event that Executive continues to serve as Chairman or as
      a
      director of ADM after July 1, 2008, the period of non-competition shall begin
      on
      the last day of Executive’s service as a director and shall continue for fifteen
      (15) calendar months thereafter, at which time ADM will pay Executive the
      $1,000,000 described in the preceding sentence, provided that Executive is
      then
      in full compliance with the provisions of this Section 5. During these same
      periods, Executive will not hire or solicit for employment any executive of
      ADM
      or its subsidiaries or affiliates without the prior written consent of the
      CEO
      or President of ADM. ADM’s exclusive remedy for Executive’s failure to fully
      comply with this Section 5 shall be the forfeiture of the payment described
      in
      the preceding sentence, the forfeiture of any equity awards issued under plans
      other than ADM’s 2002 Incentive Compensation Plan that are unvested at the time
      of such breach, and the forfeiture of any unpaid Chairman
      Compensation.

     

    Section 6.  Setoff;
      No Mitigation.
      No
      payments or benefits payable to or with respect to Executive pursuant to this
      Agreement shall be reduced by any amount Executive may earn or receive from
      employment with another employer or from any other source, except as expressly
      provided in Section 4(c)(ii). Executive shall have no duty to mitigate his
      damages by seeking other employment. 

    
      
        
        

      

      
        
          

        

      

       

    

    Section 7.  Indemnification;
      D&O Coverage.
      ADM
      shall continue to indemnify Executive and provide directors’ and officers’
liability insurance coverage (including, where required, legal defense) for
      actions prior to Executive’s Retirement Date to the same extent it indemnifies
      and provides liability insurance coverage to then-current officers and directors
      of ADM.

     

    Section 8.  Release.
      In
      consideration of the post-retirement compensation and benefits to which
      Executive would not otherwise be entitled by law, contract or under the policies
      or practices of ADM that will be provided to Executive pursuant to this
      Agreement, Executive agrees to execute and deliver to ADM between the Retirement
      Date and 21 days following the Retirement Date a general release and waiver
      in a
      form substantially similar to that used for other senior executives of ADM
      under
      which Executive releases and discharges ADM and its affiliates, subsidiaries,
      joint ventures and related entities, and each of their past and present
      officers, directors, managers, attorneys, benefit plans and plan administrators
      and agents, from all claims and causes of action of any kind, including, but
      not
      limited to, claims and causes of action arising out of Executive’s employment
      and retirement, but excluding claims and causes of action relating solely to
      ADM’s obligations to make payments or provide benefits after Executive’s
      retirement pursuant to the express terms of this Agreement. Executive will
      not
      be entitled to receive such post-retirement benefits until the general release
      and waiver becomes effective in accordance with its terms.

     

    Section 9.  Death
      or Disability of Executive.
      If
      Executive dies or becomes disabled (as such term is defined in ADM’s long term
      disability plan) at any time after the date hereof, he (or his estate) shall
      receive the compensation and benefits described in this Agreement to the extent
      not previously paid to him.

     

    Section 10.  Binding
      Effect; Revocation; Modification.
      The
      parties understand and agree that this Agreement is final and binding and,
      together with the Non-Disclosure Agreements previously executed by Executive,
      constitute the complete and exclusive statement of the terms and conditions
      relating to Executive’s retirement, that this Agreement supersedes all prior
      agreements and understandings (oral or written) between Executive and ADM
      relating to Executive’s employment, Retirement Date, or otherwise, that no
      representations or commitments were made by the parties to induce this Agreement
      other than as expressly set forth herein and that this Agreement is fully
      understood by the parties. This Agreement may not be modified or supplemented
      except by a subsequent written agreement signed by the party against whom
      enforcement of the modification is sought.

     

    Section 11.  Governing
      Law.
      The
      validity, construction and enforceability of this Agreement shall be governed
      in
      all respects by the laws of the State of Illinois, without regard to its
      conflicts of laws rules.

    
      
        
        

      

      
        
          

        

      

       

    

    Section 12.  
      Resolution of Disputes.
      Any
      disputes under or in connection with this Agreement shall, at the election
      of
      either party, be resolved by arbitration, to be held in Chicago, Illinois in
      accordance with the rules and procedures of the American Arbitration Association
      then in effect. Judgment upon the award rendered by the arbitrator(s) may be
      entered in any court having jurisdiction. Each party shall bear its own costs,
      including but not limited to attorneys’ fees, of the arbitration or of any
      litigation arising out of this Agreement. Pending the resolution of any
      arbitration or litigation, ADM shall continue payment of all amounts due the
      Executive under this Agreement and all benefits to which the Executive is
      entitled at the time the dispute arises.

     

    Section 13.  
      Waiver; Severability.
      No
      waiver by any party at any time of any breach by any other party of, or
      compliance with, any condition or provision of this Agreement to be performed
      by
      any other party shall be deemed a waiver of any other provision of this
      Agreement, or of any subsequent breach by such party of a provision of this
      Agreement. If any of the provisions of this Agreement shall otherwise contravene
      or be invalid under the laws of any state or other jurisdiction where it is
      applicable but for such contravention or invalidity, such contravention or
      invalidity shall not invalidate all of the provisions of this Agreement, but
      rather this Agreement shall be reformed and construed, insofar as the laws
      of
      that state or jurisdiction are concerned, as not containing the provision or
      provisions, but only to the extent that they are contravening or are invalid
      under the laws of that state or jurisdiction, and the rights and obligations
      created hereby shall be reformed and construed and enforced
      accordingly.

     

    Section 14.  Withholding.
      ADM may
      withhold from any amounts payable under this Agreement such federal, state
      and
      local taxes as may be required to be withheld pursuant to applicable laws or
      regulations.

     

    Section 15.  Counterparts.
      This
      Agreement may be executed by either of the parties hereto in counterparts,
      each
      of which shall be deemed to be an original, but all such counterparts shall
      together constitute one and the same instrument.

     

    IN
      WITNESS WHEREOF,
      the
      parties hereto have executed this Agreement as of the date first above
      written.

     

     

    
      	 ARCHER
              DANIELS MIDLAND COMPANY
	 	 	 
	 	 	 
	 By:      
              s/s O. Glenn Webb	 	/s/
              G. Allen Andreas 
	 Name: 
              O. Glenn Webb	 	G.
              Allen Andreas
	 Title:   
              Lead Director

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