Document:

exv4w3

Exhibit 4.3

Dated 24 May 2007 as amended

HSBC ASIA HOLDINGS B.V. (1)

and

MICHAEL F. GEOGHEGAN (2)

and

HSBC HOLDINGS PLC (3)

SERVICE AGREEMENT

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	1 DEFINITION AND INTERPRETATION
	 	 	1	 
	 
	2 APPOINTMENT
	 	 	2	 
	 
	3 DURATION OF THE EMPLOYMENT
	 	 	2	 
	 
	4 SCOPE OF THE EMPLOYMENT
	 	 	4	 
	 
	5 HOURS AND PLACE OF WORK
	 	 	5	 
	 
	6 REMUNERATION
	 	 	5	 
	 
	7 BENEFITS
	 	 	7	 
	 
	8 TAX
	 	 	8	 
	 
	9 DEDUCTIONS
	 	 	9	 
	 
	10 SHARE SCHEMES
	 	 	9	 
	 
	11 EXPENSES
	 	 	10	 
	 
	12 ANNUAL LEAVE
	 	 	10	 
	 
	13 TERMINATION
	 	 	10	 
	 
	14 DIRECTORS LIABILITY INSURANCE
	 	 	12	 
	 
	15 RESTRICTIVE COVENANTS
	 	 	12	 
	 
	16 RESTRICTIONS ON OTHER ACTIVITIES
	 	 	16	 
	 
	17 CONFIDENTIAL INFORMATION
	 	 	17	 
	 
	18 INVENTIONS AND OTHER INTELLECTUAL PROPERTY
	 	 	18	 
	 
	19 DOCUMENTS AND OTHER PROPERTY
	 	 	19	 
	 
	20 GRIEVANCE, DISMISSAL AND DISCIPLINARY PROCEDURES
	 	 	19	 
	 
	21 SICKNESS POLICY
	 	 	20	 
	 
	22 ENTIRE AGREEMENT AND SEVERABILITY
	 	 	20	 
	 
	23 COUNTERPARTS
	 	 	20	 
	 
	24 GOVERNING LAW AND JURISDICTION
	 	 	21	 

-i-

 

THIS AGREEMENT is dated 24 May 2007 as amended on 29 February 2008 and 1 February 2010 is made

BETWEEN:

	(1)	 	HSBC ASIA HOLDINGS B.V. (No.33296181) whose registered office is at De entree 242, 1101EE
Amsterdam, The Netherlands (the “Employer”);

	(2)	 	MICHAEL F GEOGHEGAN of 19 Middle Gap Road, Hong Kong SAR (the “Executive”); and

	(3)	 	HSBC HOLDINGS PLC (No. 617987) at 1 Queen’s Road Central, Hong Kong SAR (“HSBC”).

NOW IT IS HEREBY AGREED as follows:

	1	 	Definition and interpretation
	 
	1.1	 	In this Agreement.
	 
	1.1.1	 	the following expressions have the following meanings:

	 	 	“Board” shall mean the board of directors of HSBC;
	 
	 	 	“the Employment” means the Executive’s employment hereunder;
	 
	 	 	“the Group” means the Employer, HSBC and the Group Companies;
	 
	 	 	“Group Company” means HSBC and any holding company for the time being of HSBC or any
subsidiary for the time being of HSBC or of any such holding company (for which purpose the
expressions “holding company” and “subsidiary” shall have the meanings ascribed thereto by
section 1159 Companies Act 2006) and “Group Companies” shall be construed accordingly;
	 
	 	 	“HMRC” means Her Majesty’s Revenue and Customs;
	 
	 	 	“PAYE Regulations” means any regulations made pursuant to the Income Tax (Earnings and
Pensions) Act 2003;
	 
	 	 	“Tax” means (i) all forms of tax, levy, duty, charge, impost. withholding, tariff or other
amount (including national insurance contributions) whenever created or imposed and payable
to HMRC, the Hong Kong Internal Revenue Department and other appropriate authorities; or
(ii) all charges, interest, penalties, fines and surcharges incidental or relating to any
Tax falling within (i) or which arise as a result of the failure to pay any Tax on the due
date or to comply with any obligation relating to Tax; and

 

 

	 	 	“Tax Liability” means a liability to make a payment of Tax or to make a payment in respect
of Tax where such liability is imposed by law, whether or not such Tax is also or
alternatively chargeable against or attributable to any other person.

	1.1.2	 	references to clauses and sub-clauses are to clauses and sub-clauses of this Agreement; and
	 
	1.1.3	 	the headings to the clauses are for convenience only and shall not affect the construction
or interpretation of this Agreement.
	 
	2	 	Appointment
	 
	2.1	 	The Employer shall employ the Executive and the Executive agrees to act as a senior executive
of the Employer on and subject to the terms and conditions specified herein on the basis that
his principal role is to be seconded to HSBC based in Hong Kong as its Group Chief Executive.
	 
	2.2	 	Subject to clause 2.3, HSBC undertakes to procure and guarantees to the Executive the
performance by the Employer of its obligations pursuant to this Agreement and undertakes to
indemnify the Executive in respect of any losses arising by virtue of any breach or
nonperformance thereof.
	 
	2.3	 	The indemnity provided to the Executive pursuant to clause 2.2 shall not operate in any
circumstances to negate or reduce the requirement for the Executive to mitigate any loss
suffered by him in accordance with ordinary contract principles, in relation to any claim
which he may have against the Employer for breach or non-performance of its obligations as
aforesaid.
	 
	3	 	Duration of the Employment
	 
	3.1	 	The Employment (and the Secondment set out at clause 4.1) pursuant to this Agreement shall
commence with effect from 26 January 2010 (the “Commencement Date”) and subject to clauses 3.5
and 13 below shall continue thereafter until the Employment and the Secondment is terminated
by the relevant party giving to the other party not less than 12 months’ notice in writing.
For the avoidance of doubt, notice given by either the Employer or the Executive at any time
to terminate the Employment will also be accepted by all parties and for all purposes as
notice to terminate the Secondment simultaneously.
	 
	3.2	 	The Employer reserves the right in its absolute discretion to terminate the Executive’s
employment with immediate effect by paying a sum equal to basic salary, pension allowance and
other contractual benefits (or cash equivalent) (but excluding any bonus) in lieu of notice
(less any deductions required to be made under the PAYE Regulations), or where such payment is
made in lieu of part of the notice period, if

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	 	 	part of the period is worked at the Employer’s request, an appropriately reduced pro
rata sum.
	 
	3.3	 	The Employer reserves the right during any period of notice (for a period or periods in
aggregate not exceeding six months) to exclude the Executive from the premises of any Group
Company, or to require the Executive to carry out specified duties (consistent with his role
and status) at premises other than those at which he ordinarily carries out his duties, or to
carry out no duties, and to instruct the Executive not to communicate with clients, employees,
agents or representatives of the Group (other than purely social contact with persons with
whom the Executive has established social relationships) until the Employment has terminated,
provided always that the Executive will continue to be paid and to enjoy normal contractual
pay and benefits during any such period.
	 
	3.4	 	The Executive’s period of continuous employment with the Group began on 1 July 1973.
	 
	3.5	 	The Employment shall terminate on the last day of the month in which the Executive attains
the age of 65 or on such subsequent date as may be agreed between the Employer and the
Executive.
	 
	3.6	 	In the event that either the Executive or the Employer give notice in writing to terminate
the Employment (other than in response to the other party’s repudiatory breach of contract)
within 12 months following a Corporate Change (as defined in clause 3.7 below):
	 
	3.6.1	 	the Employment shall terminate not more than six months following such notice (the
“Corporate Change Period”), and
	 
	3.6.2	 	the Employer shall make a payment calculated in accordance with clause 3.2 in lieu of 12
months notice less the period of such notice which has elapsed during the Corporate Change
Period (less any deductions required to be made under the PAYE Regulations) within seven days
of such termination.
	 
	3.6.3	 	For the avoidance of doubt clause 3.6.1 shall not prevent the Employer from exercising its
rights in accordance with clause 3.2 to terminate the Employment with immediate effect at any
time following a Corporate Change and applying the set-off provisions at clause 3.6.2.
	 
	3.6.4	 	It is agreed that clause 3.3 shall not apply in circumstances where notice is served within
12 months following a Corporate Change.
	 
	3.6.5	 	It is recognised that the Executive is not required to mitigate his loss in relation to
payments made pursuant to this clause 3.6.

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	3.7	 	For the purposes of clause 3.6 above Corporate Change means (subject to clause 3.7.3):
	 
	3.7.1	 	If any person (i) obtains control of HSBC (within the meaning of section 840 of the Income
and Corporation Taxes Act 1988) as a result of making a general offer to acquire the shares in
HSBC, or (ii) having obtained such control makes such an offer, or (iii) obtains such control
following any force; scheme of arrangement under section 425 of the Companies Act 1985 or any
corresponding arrangement under Part 26 of the Companies Act 2006.
	 
	 	 	For these purposes, a person shall be deemed to have obtained control of HSBC if he and
others acting in concert with him have together obtained control of it.
	 
	3.7.2	 	If HSBC acquires (“the Reverse Transaction”) any company, assets or business as a result of
which there is a change in boardroom control of HSBC or where shareholders in HSBC immediately
prior to completion of the Reverse Transaction cease to hold more than 50% of the ordinary
share voting rights in HSBC immediately following completion of the Reverse Transaction; and a
change in boardroom control for the purposes of this sub clause shall mean where the
individuals who are directors of HSBC immediately prior to completion of the Reverse
Transaction shall cease (as a direct consequence of the Reverse Transaction at the request of
the other party or parties involved in the Reverse Transaction) to constitute a majority of
the directors of HSBC, or of any successor to HSBC (and for these purposes “completion of the
Reverse Transaction” shall include completion of any associated changes to the board which are
publicly announced in conjunction with and are made as a direct consequence of the Reverse
Transaction).
	 
	3.7.3	 	Any general offer, compromise, arrangement or Reverse Transaction, the purpose or effect of
which is to create a new holding company for HSBC which has substantially the same
shareholders with the same proportionate shareholdings immediately following the relevant
event as of HSBC immediately prior to the relevant event, shall not be a Corporate Change.
	 
	4	 	Scope of the Employment
	 
	4.1	 	The Executive shall be seconded to HSBC in Hong Kong to act as Group Chief Executive of HSBC,
reporting to the Group Chairman of HSBC, in which capacity he may also be required to perform
duties (consistent with his role and status as Group Chief Executive of HSBC) for the Employer
and/or any Group Company (the “Secondment”).
	 
	4.2	 	The Executive shall:
	 
	4.2.1	 	devote the whole of his working time, attention and skill to his duties;

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	4.2.2	 	faithfully and diligently perform such duties and exercise such powers consistent with his
position as may from time to time be assigned to or vested in him by the Employer or the
Board;
	 
	4.2.3	 	obey the reasonable and lawful directions of the Board;
	 
	4.2.4	 	comply with all of the Group’s rules, regulations, policies and procedures from time to time
in
	 
	4.2.5	 	use his reasonable endeavours to promote the interests of the Employer and any Group
Company; and
	 
	4.2.6	 	(in accordance with any reporting procedures prescribed by the Board) keep the Employer at
all times promptly and fully informed (in writing if so requested) of his conduct of the
business of any Group Company and provide such explanations in connection therewith as the
Board may require from time to time.
	 
	4.3	 	The Employer may, with the agreement of the Executive, transfer this Agreement to any Group
Company at any time.
	 
	4.4	 	During any period in which the Executive is suspended in accordance with clause 13.2 of this
Agreement or during any period in which the Executive is assigned no duties in accordance with
clause 3.3 of this Agreement, the Board reserves the right to appoint any other person or
persons to act jointly with the Executive as Group Chief Executive.
	 
	5	 	Hours and place of work
	 
	5.1	 	The Executive shall work such hours as are necessary for the proper performance of his
duties.
	 
	5.2	 	The Executive’s place of work in Hong Kong will be HSBC’s offices at 1 Queen’s Road Central,
Hong Kong but the Executive may be required to work at any place within Hong Kong as the Board
may reasonably require. The Executive will be given reasonable notice of any change in his
place of work. The Executive will be required to travel and undertake his duties both in and
outside Hong Kong in the performance of his duties hereunder.
	 
	6	 	Remuneration
	 
	6.1	 	With effect from the Commencement Date, the Employer shall pay to the Executive a salary
currently at the rate of GBP1,450,000 per annum (“basic salary”) (subject to deductions in
respect of tax and National Insurance contributions as may be required by law);
payable by equal monthly instalments in arrears on or about the 20th day of each calendar
month.

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	6.2	 	The Executive shall be entitled to participate in any annual bonus incentive scheme
implemented for the benefit of the directors of HSBC from time to time. The amount of any
such bonus, will be determined on the basis of such criteria as the Remuneration Committee of
HSBC or any committee authorised to act on behalf of the Board may in their absolute
discretion determine, including without limitation:

	 	(i)	 	the Executive’s performance; and
	 
	 	(ii)	 	the Group’s performance.

	6.3	 	Subject to clause 6.4, the Executive acknowledges that he will not acquire a contractual
right to receive a bonus on the basis only that during the Employment he has received one or
more bonus payments. The Executive shall not be entitled to receive a bonus if on the last
day of the relevant bonus year he is no longer employed as a result of his voluntary
resignation or the termination of the Employment pursuant to clause 13.1(b) or is under notice
of termination of employment given by the Executive.
	 
	6.4	 	In the event that the Employer terminates the Employment (including circumstances in which
the Executive is constructively dismissed) other than pursuant to clause 13.1(b) or either
party terminates the Employment in the circumstances set out in clause 3.6 the Executive shall
be entitled to be paid (a) any due and unpaid bonus for a prior completed bonus year and (b) a
pro rata bonus for the bonus year during which the Employment terminates, calculated according
to the proportion of the bonus year during which the Executive was employed by the Employer.
For the purposes of this clause, the assumed annual bonus shall be not less than the average
annual cash bonuses which the Executive received in respect of the two bonus years prior to
the bonus year in which the Employment terminates.
	 
	6.5	 	The Executive’s salary will be subject to review by the Remuneration Committee annually and
increases shall take effect from 1 March. The first such review following the date of this
Agreement shall take place in March 2011.
	 
	6.6	 	The remuneration specified in clauses 6.1 and 6.2 shall be inclusive of fees in respect of
directorships of HSBC and any other Group Companies.
	 
	6.7	 	Payment of salary, allowances and bonus payable to the Executive shall be effected either by
HSBC on behalf of the Employer or by a Group Company and, if by more than one Group Company,
in such proportions as the Employer may determine from time to time.

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	7	 	Benefits
	 
	7.1	 	The Executive shall be eligible to participate in the schemes referred to in this clause 7
subject to the rules of each relevant benefit scheme as may be in force from time to time.
	 
	7.2	 	The Employer and HSBC reserve the right to vary or withdraw each benefit scheme referred to
in this clause 7 at its absolute discretion and any such variation or withdrawal will apply to
and be advised to the Executive.
	 
	7.3	 	The benefits referred to in this clause 7 shall be provided to the Executive by HSBC on
behalf of the Employer.
	 
	7.4	 	The Executive will be a member of the HSBC International Retirement Benefit Plan (the “Plan”)
subject to its rules from time to time in force, into which HSBC on behalf of the Employer
will make a payment equivalent to 50% of basic salary per annum (subject to any deductions in
respect of tax and National Insurance contributions as may be required by law), payable in
monthly instalments. Details of the Plan are set out in the Explanatory Booklet. The
Employer and the Company reserve the right in their absolute discretion at any time to
terminate the Plan or substitute another pension scheme for the Plan (intended to provide
similar benefits and into which the same payment shall be made). In the event of termination
of the Plan which is at the sole discretion of the Employer and HSBC, the payment referred to
above shall thereafter be paid direct to the Executive (subject to any deductions in respect
of tax and National Insurance contributions as may be required by law). In no other
circumstances will such payment be payable direct to the Executive. Any such termination or
substitution will not constitute a breach of contract.
	 
	7.5	 	The Executive will be provided with life assurance cover of four times basic salary subject
to the terms and conditions of the relevant scheme in force from time to time
	 
	7.6	 	The Executive shall have access to the chauffeur driven services operated by HSBC from the
chauffeur pool.
	 
	7.7	 	The Executive shall benefit from private medical insurance cover for himself, his spouse and
dependent children in accordance with the terms of the HSBC Group International Health Scheme
at the maximum benefit levels.
	 
	7.8	 	The Executive shall be entitled to non-contributory membership of the HSBC Personal Accident
Insurance Scheme.
	 
	7.9	 	HSBC shall, each year, pay on the Employer’s behalf the cost of the Executive undergoing a
voluntary medical examination with a medical adviser appointed by or on behalf of HSBC.

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	7.10	 	The Executive will participate in the Group Income Protection Scheme as the Group will from
time to time maintain for senior executives, subject always to the terms and conditions from
time to time in force and subject to the Executive meeting the requirements of the relevant
scheme and being deemed eligible by the relevant scheme provider. The Employer reserves the
right to amend or withdraw the scheme including the level of benefits. The Employer shall not
be liable to provide any benefits or any compensation in lieu thereof or take any action to
enforce the provision of such benefits in circumstances where any relevant scheme provider
refuses for any reason whatsoever, to provide any benefits to the Executive.
	 
	7.11	 	The Executive is eligible to participate in the appropriate HSBC Housing Loan Scheme subject
to the Scheme rules from time to time in force
	 
	7.12	 	HSBC shall continue to make payments on the Executive’s behalf in respect of the annual
membership subscription of two clubs or such similar two clubs as the Executive shall nominate
each year to be approved by the Employer through the Group Managing Director, Human Resources.
	 
	8	 	Tax
	 
	8.1	 	The Executive hereby covenants with the Employer and HSBC to pay to the Employer or HSBC (as
the case may be) an amount or amounts equal to any Tax Liability of any Group Company arising
as a result of any obligation or failure to deduct and account for income tax, social taxes
and employee’s national insurance contributions (including those accountable on behalf of the
Executive to HMRC under “pay-as-you-earn” or other withholding provisions) in respect of any
payments and benefits made to or received by the Executive under this Agreement except that
if:
	 
	8.1.1	 	the Executive is required to spend more time than is reasonably envisaged by the parties in
the United Kingdom and the principal reason for this is:

	 	 (a)	 	that the Executive is required to do so by the Group; or
	 
	 	 (b)	 	a compassionate personal reason deemed by the Employer to be
exceptional and

	8.1.2	 	as a result the Executive becomes UK tax resident for the purposes of income tax in the
relevant tax year, the Executive shall be liable for any Tax Liability to HMRC in respect of
the days during such tax year on which he is deemed for tax purposes to be in the United
Kingdom and the Employer or HSBC shall be liable for any excess Tax Liability to HMRC
(including Tax on the excess Tax Liability itself) in respect of such tax year.

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	8.2	 	All payments and benefits described in clause 6 and clause 7 shall be subject to deductions
in respect of tax and social security contributions. In addition, the Executive shall be
responsible for the payment of any taxes arising out of the Executive’s participation in any
Group Share Plan including but not limited to Savings Related Share Option Plans, Group Share
Option Plans and Restricted Share Plans. The Executive shall also be personally liable for
taxes on any other assessable income or capital gains arising from his personal investments.
	 
	8.3	 	The Executive shall be entitled to advice from professional tax advisers approved by HSBC, at
the cost of the Group, for the purposes of UK and Hong Kong Tax Return preparation and
associated tax compliance services and limited financial planning.
	 
	8.4	 	The Group will not pay for tax services to be provided to the Executive’s spouse or partner.
	 
	9	 	Deductions
	 
	 	 	For the purposes of the Employment Rights Act 1996, the Executive hereby authorises the
Employer and any Group Company on the Employer’s behalf to deduct from his remuneration
hereunder any sums due from him to the Employer or any Group Company including, without
limitation, any overpayments, loans or advances made to him by the Employer or any Group
Company.
	 
	10	 	Share Schemes
	 
	10.1	 	Any shares or share options which the Executive has at the Commencement Date under any of the
Group’s share plans will be unaffected by this Agreement.
	 
	10.2	 	For so long as the Employment continues, the Executive shall continue to be eligible to
receive additional awards under the Group’s relevant share plans as they may exist from time
to time in accordance with the rules of such plans and the Employer will use reasonable
endeavours to procure that any discretion relating to the grant of additional awards to the
Executive is exercised reasonably and in good faith and that the Executive is treated no less
favourably than other executive directors of HSBC.
	 
	10.3	 	Following any termination of the Employment (provided it has not been terminated by the
Employer by reason of gross misconduct or pursuant to clause 13.1(b)), HSBC shall use all
reasonable endeavours to procure that in relation to any long term, share, share option or
share award incentive plans where there is discretion to treat the Executive as a good leaver
that discretion shall be exercised in his favour such that he shall become entitled to the
maximum permissible under such plans.

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	11	 	Expenses
	 
	 	 	HSBC or the relevant Group Company shall reimburse the Executive in respect of all
expenses reasonably incurred by him in the proper performance of his duties, subject to
the Executive providing such receipts or other evidence as the Employer may require.
	 
	12	 	Annual Leave
	 
	12.1	 	The Executive shall be entitled to 30 working days paid leave in each calendar year in
addition to all Bank and public holidays observed in England.
	 
	12.2	 	A minimum 20 working days leave must be taken by the Executive in each calendar year (1
January - 31 December) to qualify for the payment in lieu of accrued holiday described in
clause 12.3.
	 
	12.3	 	Provided the Executive submits a written return to the Group Managing Director, Human
Resources, at the end of each calendar year setting out the number of his untaken holidays in
that year, the Executive shall be paid in lieu of any accrued but untaken holiday (up to a
maximum of 20 days) during each two year period, such sum to be calculated in accordance with
the salary level applicable to the Executive on the 31 December immediately preceding the date
of payment. The next payment against any entitlement under these arrangements will be made in
January 2011.
	 
	12.4	 	In the holiday year in which the Employment terminates, the Executive’s entitlement to
holiday shall accrue on a pro rata basis for each month of the Employment during the relevant
year.
	 
	12.5	 	Other than as provided for in this clause 12, no accrued holiday entitlement may be carried
forward into future holiday years.
	 
	13	 	Termination
	 
	13.1	 	The Employment shall be subject to termination by the Employer:

	 	(a)	 	(subject to clause 21.2) by not less than six months’ notice in
writing given at any time while the Executive shall have been incapacitated by
reason of ill health or accident from performing his duties hereunder for a
period of or periods aggregating 120 working days in the preceding 12 months,
provided that if at any time during the currency of such a notice the Executive
shall provide a medical certificate satisfactory to the Board to the effect
that he has fully recovered his physical and/or mental health and that no
recurrence of illness or incapacity can reasonably be anticipated the Employer
shall withdraw the notice;

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	 	(b)	 	by summary notice in writing if the Executive shall have:
	 
	 	(i)	 	committed any serious breach or repeated or continued (after
warning) any material breach of his obligations hereunder; or
	 
	 	(ii)	 	been guilty of conduct tending to bring himself or the Employer
or any Group Company into disrepute provided that if such conduct is capable of
remedy, he has first been given a reasonable opportunity to remedy the conduct
and has failed to do so; or
	 
	 	(iii)	 	become bankrupt or had an interim order made against him under
the Insolvency Act 1986 or compounded with his creditors generally; or
	 
	 	(iv)	 	in the reasonable opinion of the Board, substantially failed to
perform his duties to a satisfactory standard, after having received a written
warning from the Employer relating to the same; or
	 
	 	(v)	 	been disqualified from being a director by reason of any order
made under the Company Directors Disqualification Act 1986 or any other
enactment; or
	 
	 	(vi)	 	been convicted of an offence under any statutory enactment or
regulation relating to insider dealing; or
	 
	 	(vii)	 	an officeholder of HSBC) as a Director of any Group Company,
not being at the request of or with the prior written agreement of the Employer
or the Board.

	 	 	Any delay by the Employer in exercising such right of termination shall not constitute a
waiver thereof.
	 
	13.2	 	If the Employer has reasonable grounds to suspect that the Executive has been guilty of
misconduct which would entitle it to terminate the appointment of the Executive hereunder
pursuant to clause 13.1(b), or whilst the Board or any external body investigates any material
allegation which would or may entitle the Employer to terminate the Employment pursuant to
clause 13.1(b), it shall be entitled (but without prejudice to its right subsequently to
terminate such appointment on the same or any other ground) to suspend the Executive on full
pay for so long as it may reasonably require in order to establish whether such suspicions
have any foundation or not During any period of suspension the Executive will continue to be
bound by the terms of this Agreement. Any such suspension shall only exceed 21 days in
exceptional and justifiable circumstances.
	 
	13.3	 	Without prejudice to the constitution (including for the avoidance of doubt the articles of
association) of any Group Company, on termination of the Employment howsoever

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	 	 	arising or upon either the Employer or the Executive
having served notice of such termination and the
Employer having exercised its rights under clause 3.3
the Executive shall at the request of the Employer
resign from all offices held by him in the Employer
and any Group Company, provided however, that such
resignations shall be without prejudice to any claims
which the Executive may have against the Employer or
any Group Company arising out of the termination of
the Employment. The Executive hereby irrevocably
appoints any of the directors of the Board from time
to time nominated by the Board, to be his attorney in
his name and on his behalf to execute and do any such
instrument or thing and generally to use his name for
the purpose of giving the Employer and any Group
Company the full benefit of this clause.
	 
	14	 	Directors Liability Insurance
	 
	 	 	The Executive shall benefit from cover under the HSBC policy on Directors’ and Officers’
Liability (including Outside Directors’ and Officers’ Liability) subject always to the
rules of the policy from time to time in force, details of which have been provided to
the Executive.
	 
	15	 	Restrictive covenants
	 
	15.1	 	For the purposes of this clause 15 the following words shall have the following meanings.
	 
	15.1.1	 	“Company Products” shall mean any banking or financial products developed, supplied or sold
by the Employer with which the duties of the Executive were concerned or for which he was
responsible during the twelve months immediately preceding the Termination Date.
	 
	15.1.2	 	“Company Services” shall mean any banking or financial services developed or supplied by the
Employer with which the duties of the Executive were concerned or for which he was responsible
during the twelve months immediately preceding the Termination Date.
	 
	15.1.3	 	“Comparator Group” means the Total Shareholder Return (TSR) comparator group which applies
to the last awards made under the HSBC Share Plan immediately before the Termination Date or
where any companies in the TSR comparator group are the subject of a takeover or undergo any
form of reconstruction, the entities to which the business assets of such companies are
transferred from time to time;
	 
	15.1.4	 	“Confidential Information” shall have the meaning ascribed thereto in clause 17;
	 
	15.1.5	 	“Customer” shall mean any person, firm, company or other organisation whatsoever to whom or
which the Employer sold or supplied Company Products or Company

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	 	 	Services during the twelve months immediately preceding the Termination Date and with
whom or which, during such period:

	 	(a)	 	the Executive had material personal dealings in the course of
his employment; or
	 
	 	(b)	 	any employee who was under the direct supervision or indirect
supervision (meaning that the employee was directly supervised by one of the
Executive’s direct reports) of the Executive had regular or material personal
dealings in the course of his employment

	 	 	but in the case of a firm, company or other organisation shall not include any division,
branch or office of such firm, company or other organisation with which the Executive
and/or any such employee had no dealings during the said period.
	 
	15.1.6	 	“Prospective Customer” shall mean any person, firm, company or other organization whatsoever
with whom or which the Employer shall have had negotiations or discussions regarding the
possible sale or supply of Company Products or Company Services during the twelve months
immediately preceding the Termination Date and which were ongoing and not finally concluded at
the Termination Date and with whom or which, during such period:

	 	(a)	 	the Executive shall have had material personal dealings in the
course of his Employment; or
	 
	 	(b)	 	any employee who was under the direct supervision or indirect
supervision (meaning that the employee was directly supervised by one of the
Executive’s direct reports) of the Executive who shall have had regular or
material personal dealings in the course of his employment but in the case of a
firm, company or other organisation shall not include any division, branch or
office of such firm, company or other organisation with which the Executive
and/or any such employee had no dealings during the said period.

	15.1.7	 	“Restricted Employee” shall mean any person who is on the Termination Date, or was during
the twelve months preceding the Termination Date, employed or engaged by the Employer and is
by reason of such employment or engagement in possession of any trade secrets or Confidential
Information relating to the business of the Employer or has acquired influence over its
Customers and Prospective Customers as defined in this clause 15 but so that references to the
Executive shall be replaced by references to the relevant employee, being in either case a
person with whom the Executive had material dealings during the two years preceding the
Termination Date.
	 
	15.1.8	 	“Restricted Products” shall mean Company Products or products of a similar kind.

13

 

	15.1.9	 	“Restricted Period” shall mean the period of twelve months immediately following the
Termination Date (save that it shall be six months for the purposes of clause 15.2.1) provided
always that if no material duties have been assigned to the Executive by the Employer during a
period immediately preceding the Termination Date in accordance with clause 3.3 above, it
shall mean the period of twelve months (or six months in the case of clause 15.2.1)
immediately following the date on which the Executive last carried out material duties
assigned to him by the Employer or the Board.
	 
	15.1.10	 	“Restricted Services” shall mean Company Services or services of a similar kind.
	 
	15.1.11	 	“Termination Date” means the date of termination of the Employment.
	 
	15.2	 	The Executive hereby undertakes that he will not during the Restricted Period without the
prior written consent of the Employer (such consent not to be unreasonably withheld) whether
by himself, through his employees or agents or otherwise howsoever and whether on his own
behalf or on behalf of any other person, firm, company or other organisation, directly or
indirectly:
	 
	15.2.1	 	in competition with the Employer anywhere in the world, in a senior capacity be employed by
or engaged or otherwise interested in any of the companies (or other entities) within the
Comparator Group in the business of developing, selling, supplying or otherwise dealing with
Restricted Products or Restricted Services;
	 
	15.2.2	 	in competition with the Employer, solicit business from or canvass any Customer or
Prospective Customer if such solicitation or canvassing is in respect of Restricted Products
or Restricted Services;
	 
	15.2.3	 	in competition with the Employer, sell or supply Restricted Products or Restricted Services
to any Customer or Prospective Cusomer; nor
	 
	15.2.4	 	solicit or induce or endeavour to solicit or induce any Restricted Employee to cease working
for or providing services to the Employer, whether or not any such person would thereby commit
a breach of contract;
	 
	15.2.5	 	employ or otherwise engage any Restricted Employee in the business of developing, selling,
supplying or otherwise dealing with Restricted Products or Restricted Services.
	 
	15.3	 	The benefit of clause 15.2 shall be held on trust by the Employer for HSBC and all other
Group Companies and the Employer reserves the right to assign the benefit of such provisions
to HSBC and to all other Group Companies, in addition the provisions of clauses 15.1 and 15.2
shall also apply as though there were substituted for references to “the Employer” references
to each Group Company in relation to

14

 

	 	 	which the Executive has in the course of his duties for the Employer or by reason of rendering services
to or holding office in such Group Company:
	 
	15.3.1	 	acquired knowledge of its trade secrets or Confidential Information, or
	 
	15.3.2	 	had material personal dealings with its Customers or Prospective Customers; or
	 
	15.3.3	 	supervised directly or supervised indirectly (meaning that the employee was directly
supervised by one of the Executive’s direct reports) employees having regular or material
personal dealings with its Customers or Prospective Customers.
	 
	15.4	 	The obligations undertaken by the Executive pursuant to this clause 15 shall, with respect to
each such Group Company, constitute a separate and distinct covenant and the invalidity or
unenforceability of any such covenant shall not affect the validity or enforceability of the
covenants in favour of any other Group Company or the Employer.
	 
	15.5	 	The Executive hereby undertakes with the Employer that he will not at any time after the
termination of the Employment in the course of carrying on any trade or business, claim,
represent or otherwise indicate any present association with the Employer or any Group Company
or for the purpose of carrying on or retaining any business or customer, claim, represent or
otherwise indicate any past association with the Employer or any Group Company to its
detriment.
	 
	15.6	 	If the restriction in clause 15.2.1 is for any reason held to be unenforceable in any
jurisdiction in the world the Executive shall agree to such amended or lesser restriction as
would enable that restriction to be enforced so far as possible in such jurisdiction.
	 
	15.7	 	The Executive hereby undertakes with the Employer that he will not at any time after the
Termination Date engage in any trade or business or be associated with any person, firm, or
company engaged in any trade or business using the names Hongkong and Shanghai Banking
Corporation or HSBC, or incorporating the words Hongkong and Shanghai Banking Corporation or
HSBC other than in a private consumer capacity.
	 
	15.8	 	Clauses 15.1 to 15.6 shall apply howsoever the Employment is determined and whether or not
such termination is connected with or results from a breach of this Agreement on the part of
the Executive or the Employer.
	 
	15.9	 	While the restrictions in this clause 15 (on which the Executive has taken independent
advice, as the Executive hereby acknowledges) are considered by the parties to be reasonable
in all the circumstances, it is agreed that if any such restrictions, by themselves, or taken
together, shall be adjudged to go beyond what is reasonable in

15

 

	 	 	all the circumstances for the protection of the
legitimate interests of the Employer or a Group Company
but would be adjudged reasonable if part or parts of the
wording thereof were deleted, the relevant restriction or
restrictions shall apply with such deletion(s) as may be
necessary to make it or them valid and effective.
	 
	16	 	Restrictions on other activities
	 
	16.1	 	The Executive must disclose, in writing, all interests in any business other than that of the
Employer, or a Group Company save for holdings of no more than 5 per cent. of issued shares of
any one company listed on a recognised investment exchange.
	 
	16.2	 	The Executive shall obtain the Board’s prior written approval before accepting appointment as
a Director of any company outside the Group, such approval shall not be unreasonably withheld
in relation to the Executive holding up to one non-executive directorship at any time which
does not conflict with the interests of the Group.
	 
	16.3	 	The Executive shall comply and will use his best endeavours to comply with every rule of law,
the rules, principles and regulations of the London Stock Exchange plc and The Stock Exchange
of Hong Kong Limited, every regulation of the Financial Services Authority and any other
relevant regulatory authority and every requirement, recommendation and regulation of the
Employer and the Group. Compliance also relates specifically to dealings in shares,
debentures or other securities of Group Companies and unpublished price-sensitive information
affecting such shares. Breach of this clause is likely to result in disciplinary action.
	 
	16.4	 	The Executive shall not (and shall procure so far as he is able that his spouse, infant
children and other connected persons, within the meaning of section 346 Companies Act 1985 (“a
Connected Person”), shall not deal or become or cease to be interested (within the meaning set
out in Schedule 1 Companies Act 2006) in any securities of the Employer or Group Companies,
except in accordance with the Employer’s code for securities transactions by directors.
	 
	16.5	 	Other than any special discount available to the Employer’s employees generally, the
Executive and any Connected Persons shall not be entitled to receive or obtain directly or
indirectly any discount, rebate or commission in respect of any sale or purchase of goods or
services or other business transacted on behalf of HSBC or any Group Company. The Executive
must account to HSBC (or other Group Company as applicable) for any discount, rebate or
commission received.
	 
	16.6	 	The Executive shall not after the Employment make or authorise any disparaging remarks about
the Employer or any Group Company or any of their respective directors and other officers.

16

 

	16.7	 	The Executive will not, during the Employment, introduce to any other person, firm, company
or organisation business of a kind with which a Group Company is able to deal and he will not
derive any financial interest or benefit from contracts or transactions entered into by a
Group Company without first disclosing the interest or benefit to the Employer and obtaining
its written approval.
	 
	17	 	Confidential Information
	 
	17.1	 	The Executive shall not, during the Employment or after its termination (howsoever caused):
	 
	17.1.1	 	divulge or communicate to any person, company, business entity or other organisation;
	 
	17.1.2	 	use for his own purposes or for any purposes other than those of HSBC or any Group Company;
or
	 
	17.1.3	 	through any failure to exercise due care and diligence
	 
	17.1.4	 	cause any unauthorised disclosure of any trade secrets or Confidential Information relating
to HSBC or Group Companies but so that these restrictions shall cease to apply to any
information which shall become available to the public generally otherwise than through the
default of the Executive. Confidential Information includes, but is not restricted to:

	 	•	 	financial information including results and forecasts;
	 
	 	•	 	proposals relating to acquisitions and disposals;
	 
	 	•	 	details concerning employees and officers of Group Companies;
	 
	 	•	 	customer details;
	 
	 	•	 	further information which the Executive is told is confidential and any information
given to the Executive or to the Employer or any Group Company in confidence by
customers or other persons; and
	 
	 	•	 	(in the case of the Executive) any information about the Executive’s personal,
business or financial affairs or those of his family and relatives.

	17.2	 	The Employer shall not (and shall use all reasonable endeavours to procure that no Group
Company or any of their respective directors or other officers shall) after the Employment
make or authorise any disparaging remarks about the Executive or publish or use in order to
disadvantage the Executive any Confidential Information concerning the Executive or his
family.

17

 

	17.3	 	The Executive shall not after the Employment make or authorize any disparaging remarks about
the Employer or any Group Company or any of their respective directors and other officers.
	 
	17.4	 	The restrictions of this clause 17 shall not apply to any information disclosed to
professional advisers or relevant tax authorities or which may be required to be disclosed by
law.
	 
	18	 	Inventions and Other Intellectual Property
	 
	18.1	 	The Executive may make inventions or create other intellectual property during the
Employment. In this respect the Executive has a special responsibility to further the
interests of the Group given the Executive’s position at the Employer and the remuneration
paid to the Executive under this Agreement.
	 
	18.2	 	In recognition of the Executive’s position, remuneration and responsibility, the Executive
acknowledges and agrees that any invention, improvement, design, process, information,
copyright work, trade mark, trade name or get-up or any other intellectual property (together
the “Intellectual Property”) made, created or discovered by him during the Employment (whether
capable of being patented or registered or not) in conjunction with or in any way affecting or
relating to the business of the Group or capable of being used or adapted for use in the Group
or in connection therewith shall be immediately disclosed to the Employer and shall belong to
and be the absolute property of the Employer or such Group Company as the Employer may direct.
	 
	18.3	 	However clause 18.2 shall only apply to the extent that any invention was made by the
Executive in the course of his Duties and (i) such invention was reasonably expected to result
therefrom; and/or (ii) at the time of making the invention, because of the nature of his
Duties and the particular responsibilities arising therefrom, the Executive had a special
obligation to further the interests of the Group. For the purpose of this clause 18 ‘Duties’
means in the course of the Executive’s duties or in the course of duties falling outside his
normal duties but which have been specifically assigned to him.
	 
	18.4	 	The Executive acknowledges that he has no rights, interest or claims, either during the
Employment or after the termination of the Employment, in or to any such Intellectual Property
and he shall not use such Intellectual Property other than during the period of the Employment
and for the purpose of the Group.
	 
	18.5	 	If and whenever required to do so by the Employer, (whether during the Employment or after
its termination), the Executive shall at the expense of the Employer or such Group Company as
the Employer may direct:

18

 

	18.5.1	 	apply or join with the Employer or such Group Company in applying for letters patent or
other protection or registration in the United Kingdom and in any other part of the world for
any such Intellectual Property; and
	 
	18.5.2	 	execute and do all instruments and things necessary for vesting the said letters patent or
other protection or registration when obtained and all right title and interest to and in the
same absolutely and as sole beneficial owner in the Employer or such Group Company or in such
other person as the Employer may specify.
	 
	18.6	 	The Executive agrees that he irrevocably and unconditionally waives all rights under Chapter
IV of the Copyrights, Designs and Patents Act 1988 in connection with his authorship of any
existing or future copyright work, in whatever part of the world such rights may be
enforceable.
	 
	18.7	 	Nothing in this clause shall be construed as restricting the Executive’s rights or those of
the Employer or any Group Company under the Patents Act 1977 and in particular, sections 39 to
43 Patents Act 1977.
	 
	19	 	Documents and Other Property
	 
	 	 	On termination of the Employment for any reason whatsoever (or earlier if requested),
the Executive shall immediately deliver up to the Employer (or any Group Company
nominated by the Employer), originals and copies of all documents, accounts, computer
disks and printouts and all other property in his possession or control which belong or
relate in any way to the business of the Employer or any Group Company. Provided always
that (subject to the request being reasonable), the Executive shall be provided with
copies of all Board Minutes (and documents referred to therein) relating to any period
during which he is a director of any Group Company.
	 
	20	 	Grievance, dismissal and disciplinary procedures
	 
	20.1	 	If the Executive wishes to obtain redress of any grievance relating to the Employment or is
dissatisfied with any reprimand, suspension or other disciplinary step taken by the Employer,
he shall apply in writing to the Board, setting out the nature and details of any such
grievance or dissatisfaction. If the Executive is not satisfied with the decision of any
person nominated by the Board to hear his grievance, he may, within seven days of the
decision, appeal in writing to a non executive director of HSBC nominated by the Board. A
copy of the full grievance procedure applicable to the Employment is set out in the HSBC
Employee Handbook. The grievance procedure is not contractually binding on the Employer or
HSBC.
	 
	20.2	 	The disciplinary rules applicable to the Executive are set out in the HSBC Employee Handbook.
The disciplinary procedure is not contractually binding on the Employer or HSBC.

19

 

	21	 	Sickness Policy
	 
	21.1	 	The Employer shall continue to pay the Executive’s salary during any period of absence on
medical grounds up to a maximum of 120 working days in any period of 12 months, provided that
the Executive shall from time to time if required:
	 
	21.1.1	 	supply the Employer or relevant Group Company with medical certificates covering any period
of sickness or incapacity exceeding seven days (including weekends); and
	 
	21.1.2	 	undergo at the expense of the Employer or relevant Group Company a medical examination by an
appointed doctor.
	 
	21.1.3	 	Payment of the Executive’s salary pursuant to clause 21.1 shall be inclusive of any
Statutory Sick Pay to which the Executive may be entitled.
	 
	21.2	 	The Employer reserves the right to terminate the Employment in accordance with the terms of
this Agreement notwithstanding the Executive’s absence through sickness or injury at any time,
and notwithstanding any outstanding or prospective entitlement to pay in accordance with
clause 21.1 or private medical insurance or permanent health insurance. The Employer shall
not be liable for any loss arising from such termination. Provided always that the Employer
shall not terminate the Employment where the substantial reason is the Executive’s illness or
incapacity and the effect of such termination would be to deprive the Executive of the benefit
of payments under any permanent health insurance scheme
	 
	22	 	Entire Agreement and Severability
	 
	22.1	 	This Agreement shall be in substitution for any previous letters of appointment, agreements
or arrangements, whether written, oral or implied relating to the employment of the Executive
with the Employer or any Group Company. In the event of a conflict between the provisions of
this Agreement and the provisions of any other document purporting to relate to the
Employment, the provisions of this Agreement shall prevail.
	 
	22.2	 	The provisions of this Agreement are severable and, if any one or more provision may be
determined to be illegal or otherwise unenforceable, in whole or in part, the remaining
provisions, and any partially unenforceable provision to the extent enforceable in any
jurisdiction, will nevertheless be binding and enforceable.
	 
	23	 	Counterparts
	 
	 	 	This Agreement may be executed in any number of counterparts and by the parties on
separate counterparts, but in that case shall not be effective until each party has
executed at least one counterpart. Each counterpart shall constitute the original of
this Agreement, but all counterparts together constitute one and the same instrument.

20

 

	24	 	Governing Law and Jurisdiction
	 
	 	 	This Agreement shall be governed, construed and interpreted in accordance with the laws
of England and the Executive and the Employer agree that the courts and/or tribunals of
England are to have exclusive jurisdiction to determine any disputes which may arise
under this Agreement and/or in connection with the Employment and/or its termination.

IN WITNESS whereof this Agreement has been executed the day and year first above written.

Executed as a Deed by   
                   
            )

	 	 	 	 	 
	HSBC Asia Holdings B.V. in the presence of:)	 	 
	 

	 	Dated:	 	 
	 

	 	 	 	 
	Director
	 	 	 	 
	 
	 	 	 	 
	 

	 	Dated:	 	 
	 

	 	 	 	 
	Director/Secretary
	 	 	 	 

	 	 	 	 	 	 	 	 	 	 	 
	Executed as a Deed by

	)	 	 	 	 	 	 	 
	 
	 	 	 	 
	Michael Geoghegan

	)	 	 	 	 	 	 	Dated:                     
	 

	 	 	 	 	 	 	 
	 
	 	 	 	 
	in the presence of:

	)	 	 	 	 	 	 	Dated:                     
	 

	 	 	 	 	 	 	 
	 
	 	 	 	 
	Witness Name

	)	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 
	 
	 	 	 	 
	Address

	)	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 
	 
	 
	 	 	 	 
	 

	 	 	 	 	 	 	 
	 
	 	 	 	 
	Occupation
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 
	 
	 	 	 	 
	Executed as a Deed by

	 	 	 	 	)	 	 	 
	 
	 	 	 	 
	HSBC Holdings plc in the presence of:

	 	 	 	 	)	 	 	 

	 	 	 	 	 
	Director
	 	 	 	 
	 
	 	 	 	 
	 

	 	Dated:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Director/Secretary
	 	 	 	 
	 
	 	 	 	 
	 

	 	Dated:	 	 
	 

	 	 	 	 

21exv10w4

Exhibit 10.4

EMPLOYMENT AGREEMENT

     THIS AGREEMENT (the “Agreement”) is entered into by and between FreightCar America, Inc., a
Delaware corporation (the “Company”), and Laurence M. Trusdell (the “Executive”), effective as of
the date set forth by the Executive on the signature page hereof (the “Effective Date”).

     WHEREAS, the Executive and the Company have reached agreement concerning the terms and
conditions of his employment and wish to formalize that agreement;

     NOW, THEREFORE, in consideration of the mutual terms, covenants and conditions stated in this
Agreement, the Executive and the Company agree as follows:

     1. Employment, Position and Duties. The Company shall employ the Executive, and the
Executive hereby agrees to serve the Company, as its General Counsel and Corporate Secretary, and
the Executive shall have such responsibilities, duties and authority as are customarily associated
with such office. The Executive also hereby agrees to serve as an officer of such of the Company’s
subsidiaries (if any) as the Company’s Chief Executive Officer shall reasonably request.

     2. Term. The employment of the Executive by the Company pursuant to this Agreement
will commence as of the Effective Date and will terminate three (3) years thereafter; provided,
however, that this Agreement shall remain in effect from year to year thereafter unless, not less
than ninety (90) days prior to the then termination of the term of this Agreement, either the
Executive or the Company shall deliver to the other written notice of his or its intention not to
continue in effect this Agreement, in which case this Agreement shall terminate as of December 31
of the year in which such notice is given (the “Term”); and provided further that, if a Change in
Control (as defined below) shall have occurred during the Term, this Agreement shall continue in
effect and the Term shall be extended until at least the second anniversary of such Change in
Control.

     3. Duties. During the Term:

     (a) The Executive shall report to the Company’s Chief Executive Officer.

     (b) The Executive will devote substantially all his full working time and best efforts,
talents, knowledge and experience to serving the Company. However, the Executive may devote
reasonable working time to activities such as supervision of personal investments and
activities involving professional, charitable, educational, religious and similar types of
activities, speaking engagements and membership on other boards of directors, provided that
such activities do not interfere in any substantial way with the business of the Company;
and provided further, that the Executive may not serve on the board of directors of any
other for-profit company without the prior written approval of the Board or of a Board
committee to which such approval shall have been delegated. The time involved in such
activities shall not be treated as vacation time. The

 

 

Executive shall be entitled to keep any amounts paid to him in connection with such
activities (e.g., director fees and honoraria).

     (c) The Executive will perform his duties diligently and competently and shall act in
conformity with the Company’s written and oral policies and within the limits, budgets and
business plans set by the Board. The Executive will at all times during the Term adhere to
and obey all of the rules and regulations in effect from time to time relating to the
conduct of executives of the Company. Except as provided in (b) above, the Executive shall
not engage in consulting work or any trade or business for his own account or for or on
behalf of any other person, firm or company that competes, conflicts or interferes with the
performance of his duties hereunder in any way.

     4. Place of Performance. In connection with the Executive’s employment by the
Company, the Executive shall be based at the Company’s offices in Chicago, Illinois, except for
required travel on the Company’s business.

     5. Compensation and Related Matters. As compensation and consideration for the
performance by the Executive of the Executive’s duties, responsibilities and covenants pursuant to
this Agreement, the Company agrees to pay the Executive and the Executive agrees to accept in full
payment for such performance the amounts and benefits set forth below:

     (a) Salary. Commencing as of the Effective Date, the Company shall pay to the
Executive an annual base salary (“Base Salary”) of two hundred seventy thousand dollars
($270,000). Thereafter, the Board, or such committee of the Board as is responsible for
setting the compensation of senior executive officers, shall review the Executive’s Base
Salary annually in January of each year, in light of competitive data, the Company’s
performance, and the Executive’s performance, and determine whether to increase the
Executive’s Base Salary on a prospective basis. The first review shall be in January 2008.
Such adjusted annual salary then shall become the Executive’s “Base Salary” for purposes of
this Agreement. The Executive’s annual Base Salary shall not be reduced at any time,
including after any increase, without the Executive’s consent. The Company shall pay the
Executive’s Base Salary according to payroll practices in effect for all senior executive
officers of the Company.

     (b) Annual Bonus. The Executive will be eligible for an annual cash bonus (the
“Bonus”) in accordance with the provisions of the Company’s Salaried Bonus Plan (the “RONA
Plan”), based on performance, and calculated as a percentage of the Executive’s Base Salary.
Initially, the Executive will participate in the RONA Plan at the Group A, forty percent
(40%) of Base Salary target level. In any plan adopted by the Company to replace the
current RONA Plan, the Executive’s participation will have a potential payout at least equal
to his potential payout under the current RONA Plan.

     The Company shall pay the Executive’s Bonus, if any, according to the terms of the RONA
Plan. The Company intends that the Bonus will be paid within 21/2 months of the close of the
Company’s fiscal year, but in no event later than the end of the Company’s first fiscal
quarter. In the event that payments are not made within 21/2 months of the close of the
Company’s fiscal year, it is the Company’s intent that this

-2-

 

Agreement be construed in a manner consistent with Section 409A of the Internal Revenue
Code of 1986, as amended (the “Code”).

     (c) Equity Compensation. On the Effective Date, the Company shall award the
Executive six thousand five hundred (6,500) shares of Restricted Stock in accordance with
and subject to the terms of the FreightCar America, Inc. 2005 Long Term Incentive Plan (the
“2005 LTIP”), vesting in three annual installments beginning on the first anniversary of the
Effective Date, of 2166, 2167, and 2167 shares respectively. This Restricted Stock award
would become fully vested upon a Change in Control. During the Term the Executive shall be
eligible for future awards under the 2005 LTIP or any similar or successor plan, in the sole
discretion of the Board.

     (d) Automobile Allowance. During his employment hereunder, the Company shall
make payments to the Executive of five hundred dollars ($500.00) per month to defray costs
associated with the Executive’s automobile.

     (e) Other Benefits. The Executive shall be entitled to participate in or
receive benefits under any employee benefit plan, arrangement or perquisite made available
by the Company at any time during his employment hereunder to its executive employees
(collectively the “Benefit Plans”), including without limitation each retirement, 401(k) and
profit sharing plan, group life insurance and accident plan, medical and dental insurance
plan, and disability plan, subject to and on a basis consistent with the terms, conditions
and overall administration of such plans and arrangements. The Company reserves the right
to make changes to any plan, arrangement or perquisite in which the Executive participates,
including termination of any such plan or arrangement, in its sole discretion, if such
changes do not result in a proportionately greater reduction in the rights of or benefits to
the Executive as compared with other executives of the Company or if such changes are
required by law or are technical changes.

     (f) Expenses. The Executive shall be entitled to receive an advance or prompt
reimbursement for all reasonable travel and entertainment expenses or other out-of-pocket
business expenses incurred by the Executive during the Term in fulfilling the Executive’s
duties and responsibilities under this Agreement, including all expenses of travel and
living expenses while away from home on business or at the request and in the service of the
Company, provided that such expenses are incurred and accounted for in accordance with the
policies and procedures established by the Company.

     (g) Vacation. During his employment hereunder, the Executive shall be entitled
to paid vacations in each calendar year, determined in accordance with the Company’s
vacation policy but not less than four weeks per year. The Executive shall also be entitled
to all paid holidays and personal days given by the Company to its executive employees.

     6. Termination. The Company, upon action by the Board, may terminate the Executive’s
employment hereunder under the following circumstances:

     (a) Death. The Executive’s employment hereunder shall terminate upon his
death.

-3-

 

     (b) Disability. The Company may terminate the Executive’s employment hereunder
in the event of the Executive’s Disability. For purposes of this Agreement, “Disability”
shall mean, in the written opinion of a qualified physician selected by the Company, the
Executive is, by reason of any medically determinable physical or mental impairment that can
be expected to result in death or can be expected to last for a continuous period of not
less than 12 months, (i) unable to engage in any substantial gainful activity, or (ii)
receiving income replacement benefits for a period of not less than 3 months under the
Company’s disability plan.

     (c) Cause. The Company may terminate the Executive’s employment hereunder for
Cause. For purposes of this Agreement, the Company shall have “Cause” to terminate the
Executive’s employment hereunder upon the Executive’s (i) willful and continued failure
substantially to perform his material duties with Company (other than due to Disability), or
the commission of any activities constituting a material violation or material breach of any
federal, state or local law or regulation applicable to the activities of Company, in each
case, after notice thereof from the Board to the Executive and (where possible) a reasonable
opportunity for the Executive to cease and cure such failure, breach or violation in all
respects, (ii) fraud, breach of fiduciary duty, dishonesty, misappropriation or other act
that causes material damage to the Company’s property or business, (iii) repeated absences
from work such that the Executive is unable to perform his employment or other duties in all
material respects, other than due to Disability or a condition that with the passage of time
would become a Disability, (iv) admission or conviction of, or plea of nolo contendere to,
any crime that, in the reasonable judgment of the Board, adversely affects the Company’s
reputation or the Executive’s ability to carry out the obligations of his employment, (v)
failure to reasonably cooperate with the Company in any internal investigation or
administrative, regulatory or judicial proceeding, after notice thereof from the Board to
the Executive and a reasonable opportunity for the Executive to cure such non-cooperation
or, (vi) act or omission in violation or disregard of the Company’s policies, including but
not limited to the harassment and discrimination policies and Standards of Conduct of the
Company then in effect, in such a manner as to cause significant loss, damage or injury to
the property, reputation or employees of the Company. In addition, the Executive’s
employment shall be deemed to have terminated for Cause if, after the Executive’s employment
has terminated, facts and circumstances are discovered that would have justified a
termination for Cause. For purposes of this Agreement, no act or failure to act on the
Executive’s part shall be considered “willful” unless it is done, or omitted to be done, by
him in bad faith or without reasonable belief that his action or omission was in the best
interests of the Company. Any act or failure to act based upon authority given pursuant to
a resolution duly adopted by the Board or based upon the advice of counsel for the Company
shall be conclusively presumed to be done, or omitted to be done, in good faith and in the
best interests of the Company.

     7. Compensation Upon Termination, Death or During Disability.

     (a) Termination for any Reason. If the Executive’s employment terminates for
any reason, the Company shall pay to him (or his representative) (i) the Executive’s earned
but unpaid Base Salary through the date of termination, (ii) any annual incentive

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plan bonus, or other form of incentive compensation, for which the performance
measurement period has ended and the payment amount earned, but which is unpaid at the time
of termination, (iii) any accrued but unpaid vacation, (iv) any amounts payable under any of
the Company’s employee benefit plans in accordance with the terms of those plans, except as
may be required under Code Section 401(a)(13), and (v) unreimbursed business expenses
incurred by the Executive on the Company’s behalf under Section 5(f).

     (b) Death or Disability. If the Executive’s employment is terminated due to
his death or Disability, the Company shall pay the Executive the benefits and amounts under
Section 7(a), including life or long-term disability insurance benefits, and the Company
shall, thereafter, have no further obligations to the Executive under this Agreement.

     (c) Cause or By Executive Other than for Good Reason. If the Executive’s
employment is terminated by the Company for Cause or by the Executive for other than Good
Reason, the Company shall pay the Executive the benefits and amounts under Section 7(a), and
the Company shall, thereafter, have no further obligations to the Executive under this
Agreement. For purposes of this Agreement, “Good Reason” shall mean, without the
Executive’s written consent, the occurrence of any of the following conditions: (i) a Change
in Control pursuant to which the buyer does not either assume this Agreement or otherwise
agree to employ the Executive at or after the acquisition date on terms substantially
comparable in the aggregate to this Agreement, or (ii) unless such condition is fully
corrected within 60 days after written notice thereof, the Company (A) permanently and
materially diminishes the Executive’s authority, duties, or responsibilities, including
without limitation reporting responsibilities, (B) materially reduces the Executive’s
overall compensation, including Base Salary, Bonus opportunity and equity award
participation, (C) requires the Executive to relocate his principal business office to a
location not within 50 miles of the Company’s principal business office located in the
Chicago, Illinois metropolitan area, or (D) materially breaches the terms of this Agreement.
Notwithstanding anything in this Agreement to the contrary, a separation from service due
to Good Reason must occur, if at all, within 120 days after the Company receives written
notice of any one or more of the conditions set forth in this Section 7(c). The Executive
must provide the Company with written notice of any one or more of the conditions set forth
in this Section 7(c) within 90 days of the initial existence of the condition in order for
such condition to constitute Good Reason under this Agreement.

     For purposes of this Agreement, a “Change in Control” shall be deemed to have occurred
if the conditions set forth in any one of the following paragraphs shall have been
satisfied:

     (i) any Person is or becomes the Beneficial Owner, directly or indirectly, of
securities of the Company (not including any securities beneficially owned by such
Person that were acquired directly from the Company or its affiliates) representing
fifty percent (50%) or more of the combined voting power of the Company’s then
outstanding securities; or

-5-

 

     (ii) the shareholders of the Company approve a merger or consolidation of the
Company with any other corporation and such shareholder approval results in
consummation of said merger or consolidation, other than (A) a merger or
consolidation that would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining outstanding
or by being converted into voting securities of the surviving entity), in
combination with the ownership of any trustee or other fiduciary holding securities
under an employee benefit plan of the Company, at least sixty percent (60%) of the
combined voting power of the voting securities of the Company or such surviving
entity outstanding immediately after such merger or consolidation, or (B) a merger
or consolidation effected to implement a recapitalization of the Company (or similar
transaction) in which no Person acquires more than fifty percent (50%) of the
combined voting power of the Company’s then outstanding securities; or

     (iii) the shareholders of the Company approve a plan of complete liquidation of
the Company or an agreement for the sale or disposition by the Company of all or
substantially all the Company’s assets and such shareholder approval results in
consummation of said liquidation, sale or disposition.

     For purposes of this Agreement, “Beneficial Owner” shall have the meaning
defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”). For purposes of this Agreement, “Person” shall have the meaning
given in Section 3(a)(9) of the Exchange Act, as modified and used herein; however,
a Person shall not include (A) the Company or any of its subsidiaries, (B) a trustee
or other fiduciary holding securities under an employee benefit plan of the Company
or any of its subsidiaries, (C) an underwriter temporarily holding securities
pursuant to an offering of such securities, or (D) a corporation owned, directly or
indirectly, by the stockholders of the Company in substantially the same proportions
as their ownership of stock of the Company.

     (d) By Company Without Cause or By Executive for Good Reason. If the Company
terminates the Executive’s employment without Cause, or the Executive terminates his
employment for Good Reason, then the Company shall provide the following payments and
benefits, in addition to the payments and benefits under Section 7(a):

     (i) The Company shall pay the Executive’s Base Salary for twelve (12) months
following the date of termination; provided that, notwithstanding anything in this
paragraph 7(d)(i) to the contrary, if the Executive terminates his employment for
Good Reason due to a Change in Control, the Company shall pay the Executive’s Base
Salary for twenty-four (24) months following the date of termination; provided
further that, if any payments under this paragraph must be delayed for six months
following the Executive’s termination due to the restrictions of Code Section
409A(a)(2)(A)(i), the full amount of the missed/delayed payments shall be made on
the first day of the seventh calendar month following the month in which the
Executive’s employment terminates;

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     (ii) The Company shall make a payment to the Executive, equal to the
Executive’s target level Bonus under the RONA Plan, or any successor bonus plan, for
the year of termination, with the payment made on the first March 15 following the
year of the Executive’s termination; provided that, notwithstanding anything in this
paragraph 7(d)(ii) to the contrary, if the Executive terminates his employment for
Good Reason due to a Change in Control, the Company shall pay the Executive the
bonus payment amount referred to in this paragraph multiplied by two (2); provided
further that, if the payment must be delayed for six months following the
Executive’s termination due to the restrictions of Code Section 409A(a)(2)(A)(i),
the payment shall be made on the first day of the seventh calendar month following
the month in which the Executive’s employment terminates;

     (iii) The Company shall make available continued participation in the Company’s
group health benefit plan to the Executive, and such members of his family who
participated in the group health plan at the time of the Executive’s termination,
for a period of twelve (12) months at the same costs and coverage levels and under
the same general terms and provisions of such plan as apply to active employees
after the Executive’s termination; provided that, notwithstanding anything in this
paragraph 7(d)(iii) to the contrary, if the Executive terminates his employment for
Good Reason due to a Change in Control, the period referred to in this paragraph
shall be extended to twenty-four (24) months; and

     (iv) No payments or benefits provided to the Executive hereunder shall be
reduced by any amount the Executive may earn or receive from employment with another
employer or from any other source.

     (e) The obligations of the Company to make payments and provide benefits under this
Section 7 shall survive the termination of this Agreement.

     8. Restrictive Covenants

     (a) Confidential Information. The Executive understands that the Company
possesses and will possess Confidential Information that is important to its business. The
Company devotes significant financial, human and other resources to the development of its
products, its customer base and the general goodwill associated with its business and the
Company diligently maintains the secrecy and confidentiality of its Confidential
Information. For purposes of this Agreement, “Confidential Information” is information that
was or will be developed, created, or discovered by or on behalf of the Company, or that
became or will become known by, or was or is conveyed to the Company, which has commercial
value in the Company’s business. Confidential Information is sufficiently secret to derive
economic value from its not being generally known to other persons. Confidential
Information also includes any and all financial, technical, commercial or other information
concerning the business and affairs of the Company that is confidential and proprietary to
the Company, including without limitation, (i) information relating to the Company’s past
and existing customers and vendors and development of prospective customers and vendors,
including without limitation specific customer product requirements, pricing arrangements,
payments terms, customer lists and other similar

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information; (ii) inventions, designs, methods, discoveries, works of authorship,
creations, improvements or ideas developed or otherwise produced, acquired or used by the
Company; (iii) the Company’s proprietary programs, processes or software, consisting of but
not limited to, computer programs in source or object code and all related documentation and
training materials, including all upgrades, updates, improvements, derivatives and
modifications thereof and including programs and documentation in incomplete stages of
design or research and development; (iv) the subject matter of the Company’s patents, design
patents, copyrights, trade secrets, trademarks, service marks, trade names, trade dress,
manuals, operating instructions, training materials, and other industrial property,
including such information in incomplete stages of design or research and development; and
(v) other confidential and proprietary information or documents relating to the Company’s
products, business and marketing plans and techniques, sales and distribution networks and
any other information or documents which the Company reasonably regards as being
confidential.

     The Executive understands that the Company possesses or will possess “Company
Materials” that are important to its business. For purposes of this Agreement, “Company
Materials” are documents or other media or tangible items that contain or embody
Confidential Information or any other information concerning the business, operations or
future/strategic plans of the Company, whether such documents have been prepared by the
Executive or by others. In consideration of the Executive’s employment by the Company, the
compensation received by the Executive from the Company, and the Company’s agreement to give
the Executive access to certain Confidential Information, the Executive agrees as follows:

     (i) All Confidential Information and trade secret rights, and other
intellectual property and rights (collectively “Rights”) in connection therewith
will be the sole property of the Company. At all times, both during the Executive’s
employment by the Company and after its termination for any reason, the Executive
will keep in confidence and trust and will not use or disclose any Confidential
Information or anything relating to it without the prior written consent of a then
current officer of the Company except as may be necessary and appropriate in the
ordinary course of performing Executive’s duties to the Company.

     (ii) All Company Materials will be the sole property of the Company. The
Executive agrees that during the Executive’s employment by the Company, the
Executive will not remove any Company Materials from the business premises of the
Company or deliver any Company Materials to any person or entity outside the
Company, except as the Executive is required to do so in connection with performing
the duties of his employment. The Executive further agrees that, immediately upon
the termination of the Executive’s employment by the Executive or by the Company for
any reason, or during the Executive’s employment if so requested by the Company, the
Executive will return all Company Materials, apparatus, equipment and other physical
property, or any reproduction of such property, excepting only the Executive’s copy
of this Agreement.

-8-

 

     (b) Noncompetition and Nonsolicitation. While employed by the Company and for
a period of twelve (12) consecutive months thereafter, the Executive will not, directly or
indirectly:

     (i) Contact, solicit, interfere with, or divert, or induce or attempt to
contact, solicit, interfere with or divert, any of the Company’s customers;

     (ii) Participate or engage in (as an owner, partner, employee, officer,
director, independent contractor, consultant, advisor or in any other capacity
calling for the rendition of services, advice, or acts of management, operation or
control) any business engaged in the manufacture of railcars in North America; and

     (iii) Solicit or induce or attempt to solicit or induce, by or for himself, or
as the agent of another, or through others as an agent in any way, any person who is
employed by the Company for the purpose of encouraging that employee to join the
Executive as a partner, agent, employee or otherwise in any business activity which
is competitive with the Company.

     (c) Forfeitures. In the event that the Executive materially breaches any of
the restrictions in this Section 8, he shall forfeit all of the applicable payments and
benefits under this Agreement, including but not limited to such payments and benefits
pursuant to Section 7, and the Company shall have the right to recapture and seek repayment
of any such applicable payments and benefits under this Agreement.

     (d) Intellectual Property. “Inventions” includes all improvements, inventions,
designs, formulas, works of authorship, trade secrets, technology, computer programs,
compositions, ideas, processes, techniques, know-how and data, whether or not patentable,
made or conceived or reduced to practice or developed by the Executive, either alone or
jointly with others, during the term of the Executive’s employment, including during any
period prior to the date of this Agreement. Except as defined in this Agreement, all
Inventions that the Executive makes, conceives, reduces to practice or develops (in whole or
in part, either alone or jointly with others) during his employment will be the sole
property of the Company to the maximum extent permitted by law. The Executive agrees to
assign such Inventions and all Rights in them to the Company. Exemptions from this
agreement to assign may be authorized in those circumstances where the mission of the
Company is better served by such action, provided that overriding obligations to other
parties are met and such exemptions are not inconsistent with other Company policies.
Further, the Executive may petition the Company for license to make, market or sell a
particular Invention.

     (e) Injunction. The Executive acknowledges that monetary damages will not be
an adequate remedy for the Company in the event of a breach of this Section 8, and that it
would be impossible for the Company to measure damages in the event of such a breach.
Therefore, the Executive agrees that, in addition to other rights and remedies that the
Company may have, the Company is entitled to an injunction preventing the Executive from any
breach of this Section 8, and the Executive hereby waives any

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requirement that the Company post any bond in connection with any such injunction. The
Executive further agrees that injunctive relief is reasonable and necessary to protect a
legitimate, protectible interest of the Company.

     (f) Blue Pencil. If any court determines that the covenants contained in this
Section 8, or any part hereof, are unenforceable because of the duration or geographic scope
of such provision, such court shall have the power to reduce the duration or scope of such
provision, as the case may be, to as close to the terms hereof as shall be enforceable and,
in its reduced form, such provision shall then be enforceable.

     (g) Survival. The restrictive covenants contained in this Section 8 shall
survive the termination of this Agreement.

     9. Miscellaneous.

     (a) Representations of the Executive. The Executive represents and warrants to
the Company that this Agreement when executed by the Executive will not conflict with any
other agreement or obligation of the Executive and that the Executive is not bound by any
agreement with any third party which would prohibit the Executive from his involvement with
the Company or result in any liability to the Executive or to the Company.

     (b) Binding Agreement. This Agreement and all rights of the Executive
hereunder shall inure to the benefit of and be enforceable by the Executive’s personal or
legal representatives, executors, administrators, successors, heirs, distributees, devisees
and legatees. If the Executive should die while any amounts would still be payable to him
hereunder if he had continued to live, all such amounts, unless otherwise provided herein,
shall be paid in accordance with the terms of this Agreement to the Executive’s devisee,
legatee, or other designee or, if there be no such designee, to the Executive’s estate.

     (c) Notice. Notices, demands and all other communications provided for in this
Agreement shall be in writing and shall be deemed to have been duly given when delivered, if
delivered personally, or (unless otherwise specified) mailed by United States certified or
registered mail, return receipt requested, postage prepaid, and when received if delivered
otherwise, addressed as follows:

If to the Executive: 

Laurence M. Trusdell

2508 Park Place

Evanston, IL 60201

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If to the Company: 

c/o FreightCar America, Inc.

Two North Riverside Plaza

Chicago, IL 60606

Attention: Chairman of the Board

or to such other address as any party may have furnished to the other in writing in
accordance herewith, except that notices of change of address shall be effective only upon
receipt.

     (d) Amendments, Waivers, Governing Law, Validity, Counterparts and Entire
Agreement. 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
such officers of the Company as may be specifically designated by the Board. No waiver by
either party hereto (the Company on one hand, and the Executive, on the other hand) at any
time of any breach by the other party hereto of, or compliance with, any condition or
provision of this Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or subsequent
time. The validity, interpretation, construction and performance of this Agreement shall be
governed by the laws of the State of Illinois without regard to its conflicts of law
principles. The invalidity or enforceability of any provision or provisions of this
Agreement shall not affect the validity or enforceability of any other provision of this
Agreement, which shall remain in full force and effect. 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 instrument. This Agreement sets forth the entire
agreement of the parties hereto in respect of the subject matter contained herein and
supersedes all other agreements, promises, covenants, arrangements, communications,
representations or warranties, whether oral or written, by any officer, employee or
representative of any party hereto; and any prior agreement of the parties hereto with
respect to the subject matter contained herein is hereby terminated and canceled.

     (e) Injunctive Relief. The Executive agrees that in addition to any other
remedy provided at law or in equity or in this Agreement, the Company shall be entitled to a
temporary restraining order and both preliminary and permanent injunctions restraining the
Executive from violating any provision of Section 8 of this Agreement.

     (f) Dispute Resolution. In the event of any dispute or claim relating to or
arising out of this Agreement, the Executive and the Company agree that all such disputes
shall be fully and finally resolved by binding arbitration conducted by the American
Arbitration Association (“AAA”) in Chicago, Illinois in accordance with the AAA’s National
Rules for the Resolution of Employment Disputes, provided, however, that this arbitration
provision shall not apply to, and the Company shall be free to seek, injunctive or other
equitable relief with respect to any actual or threatened breach or violation by the
Executive of his obligations under Section 8 hereof in any court having appropriate
jurisdiction. The Executive acknowledges that by accepting this arbitration provision he is
waiving any right to a jury trial in the event of a covered dispute. The

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arbitrator may, but is not required to, order that the prevailing party shall be
entitled to recover from the losing party its attorneys’ fees and costs incurred in any
arbitration arising out of this Agreement. The Company and the Executive agree that the
jurisdiction and venue for any disputes arising under, or any action brought to enforce (or
otherwise relating to), Section 8 of this Agreement shall be exclusively in the courts in
the State of Illinois, Cook County, including the Federal Courts located therein (should
Federal jurisdiction exist), and the Company and the Executive hereby submit and consent to
said jurisdiction and venue.

     (g) Withholding. All payments made to the Executive pursuant to this Agreement
shall be subject to applicable withholding taxes, if any, and any amount so withheld shall
be deemed to have been paid to the Executive for purposes of amounts due to the Executive
under this Agreement.

     (h) Removal from any Boards and Positions. If the Executive’s employment is
terminated for any reason under this Agreement, he shall be deemed to resign (i) if a
member, from the Board or board of directors of any affiliate or any other board to which he
has been appointed or nominated by or on behalf of the Company and (ii) from any position
with the Company or any affiliate, including, but not limited to, as an officer of the
Company or any of its affiliates.

     (i) Insurance; Indemnification. During the Term and through at least the fifth
anniversary of the Executive’s termination of employment from the Company, the Company
agrees to maintain the Executive as an insured party on all directors’ and officers’
insurance maintained by the Company for the benefit of its directors and officers on at
least the same basis as all other covered individuals and to indemnify the Executive to the
maximum extent permitted under applicable law.

     (j) Voluntary Agreement. The Executive and the Company represent and agree
that each has reviewed all aspects of this Agreement, has carefully read and fully
understands all provisions of this Agreement, and is voluntarily entering into this
Agreement. Each party represents and agrees that such party has had the opportunity to
review any and all aspects of this Agreement with the legal, tax and other advisor and
advisors of such party’s choice before executing this Agreement, and have been fully advised
as to the same. This Agreement has been fully and freely negotiated by the parties hereto,
shall be considered as having been drafted jointly by the parties hereto, and shall be
interpreted and construed as if so drafted, without construction in favor of or against any
party on account of its or his participation in the drafting hereof.

     (k) Counterparts. The parties may execute this Agreement in one or more
counterparts, all of which together shall constitute but one Agreement.

[Signature Page to Follow]

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          IN WITNESS WHEREOF, the parties have executed this Agreement on the date and year
written by the Executive below.

FREIGHTCAR AMERICA, INC.

	 	 	 	 	 	 	 
	By:

	 	 
	 	 
	 	 
	 

	 	 
	 	 	 	 
	 

	 	Chairman of the
Compensation Committee of
the Board of Directors
	 	 	 	Laurence M. Trusdell
	 
	 	 	 	 	 	 
	Date:

	 	 	 	 	 	Date:

-13-

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