Document:

sky-ex1015_16.htm

 

Exhibit 10.15

 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

 

This Amended and Restated Employment Agreement (the “Agreement”) is made and entered into as of June 4, 2018 (the “Effective Date”) by and between Champion Home Builders, Inc. (the “Company”) and Keith Anderson (the “Executive”). For the avoidance of doubt, the effectiveness of this Agreement is contingent upon the occurrence of the Exchange (as defined below).

 

WHEREAS, the Company and the Executive entered into an employment agreement (the “Original Employment Agreement”), effective June 2, 2015 (the “Original Effective Date”), pursuant to which the Company employed the Executive as its President and Chief Executive Officer;

 

WHEREAS, the Company and the Executive wish to amend and restate such employment agreement;

 

WHEREAS, the Executive is possessed of certain experience and expertise that qualify him to provide the direction and leadership required by the Company and its Affiliates;

 

WHEREAS, the Executive is currently employed as Chief Executive Officer of the Company; and

 

WHEREAS, subject to the terms and conditions hereinafter set forth, the Company therefore wishes to continue to employ the Executive as its Chief Executive Officer and the Executive wishes to continue such employment.

 

NOW, THEREFORE, in consideration of the foregoing premises and the mutual promises, terms, provisions and conditions set forth in this Agreement, the parties hereby agree:

 

Employment.  Subject to the terms and conditions set forth in this Agreement, the Company hereby offers, and the Executive hereby accepts, employment.

 

Term.  The Executive’s employment hereunder shall continue until terminated in accordance with Section 5 hereof. Such period is hereafter referred to as the “Term.”

 

Capacity and Performance.

 

During the Term, the Executive shall serve the Company as its Chief Executive Officer.  In addition, and without further compensation, the Executive shall serve as a member of the Board of Directors of the Company and/or director and/or officer of one or more of the Company’s Affiliates, in each case if so elected or appointed from time to time.

 

During the Term, the Executive shall be employed by the Company on a full-time basis and shall perform the duties and responsibilities of his position, and such other duties and responsibilities on behalf of the Company and its Affiliates as reasonably may be designated from time to time by the Board or by its Chair or other designee and agreed to by Executive.

During the Term, the Executive shall devote his full business time and his best efforts, business judgment, skill and knowledge exclusively to the advancement of the business and interests of the Company and its Affiliates and to the discharge of his duties and responsibilities hereunder.  Executive may serve on up to two outside boards (or serve in a similar advisory capacity), so long as such participation does not conflict with the interests of the Company or the Executive’s duties or responsibilities hereunder.  The Executive shall not engage in any other business activity or serve in any industry, trade, professional, governmental or academic position during the term of this Agreement, except as may be expressly approved in advance by the Board in writing.

 

Compensation and Benefits.  As compensation for all services performed by the Executive during the Term and subject to the Executive’s performance of his duties and obligations to the Company and its Affiliates, pursuant to this Agreement or otherwise, the Company shall provide the Executive with the following compensation and benefits:

 

Base Salary. During the Term, the Company shall pay the Executive a base salary at the rate of Six Hundred and 

 

 

Twenty-five Thousand Dollars ($625,000) per annum, payable in accordance with the payroll practices of the Company and subject to increases from time to time by either the Board of Managers of Champion Enterprises Holdings, LLC (“Holdings”), or, effective as of the closing of the transactions contemplated by Exchange (as defined below), the Board of Directors of Skyline Champion Corporation (in either case as applicable, the “Board”) in its sole discretion (such base salary, as from time to time increased, the “Base Salary”). The Board shall review the Base Salary and Target Bonus (as defined below) at least once during each fiscal year during the Term, in light of factors including the Company’s performance and profitability, the individual performance of the Executive, compensation for similarly situated executives at peer companies, and such other metrics as it deems reasonable and appropriate, in its sole discretion.

 

Annual Bonus.  For each fiscal year completed during the Term (including, for the avoidance of doubt, the 2016 fiscal year), the Executive shall be eligible to participate in such annual bonus plan as may be established by the Company for its executives generally, as in effect from time to time. The Executive’s annual target bonus shall be one- hundred percent (100%) of the Base Salary (the “Target Bonus”), with a maximum annual bonus of two-hundred percent (200%) of the Target Bonus, with the actual amount of his bonus, if any, to be determined by the Board in accordance with the Executive’s performance against performance objectives for Executive and for the Company agreed to by Executive and the Board. Other than provided for in Sections 5(a), 5(b), 5(d) and 5(e), the Executive, in order to be eligible to earn an annual bonus for any fiscal year occurring during the Term hereof, must be employed on the date payment of annual bonuses for that fiscal year is made to Company executives generally.

 

Equity Incentive.  On or promptly following the Original Effective Date, Holdings granted to Executive 5,000,000 Class C Units representing profits interests in Holdings (the “Unit Award”).  The Unit Award and any units acquired thereunder has been subject to the terms and conditions of Holdings’ 2011 Management Incentive Plan, Second Amended and Restated Limited Liability Company Agreement, and the Unit Award agreement (each, as in effect from time to time).

Time Vesting Units.Fifty percent (50%) of the Unit Award are subject to vesting on an annual basis (the “Time Vesting Units”), with twenty percent (20%) vesting on each of the first, second, third, fourth and fifth anniversaries of the Original Effective Date, subject to Executive’s continued employment with the Company on each applicable vesting date.

 

Performance Vesting Units.Fifty percent (50%) of the Unit Award are subject to vesting based on attainment of MoM (as defined in the Unit Award agreement) hurdles (the “Performance Vesting Units”) as set forth in the Unit Award agreement, subject to Executive’s continued employment with the Company on the applicable vesting date.

 

Cancellation of Existing Units.  By executing the Original Employment Agreement, the Executive forfeited, without payment, as of the Original Effective Date, one hundred percent (100%) of the Class C Units in Holdings granted to Executive pursuant to that certain Class C Unit Award Agreement by and between Holdings and Executive, dated as of July 24, 2013, which were not yet vested as of the Original Effective Date, and Executive agreed to execute any documents reasonably requested by Holdings in connection with such forfeiture.

 

Vacations. During the Term, the Executive shall be entitled to earn vacation at the rate of four (4) weeks per year, to be taken at such times and intervals as shall be determined by the Executive, subject to the reasonable business needs of the Company. Vacation shall otherwise be governed by the policies of the Company, as in effect from time to time.

 

Other Benefits.  During the term hereof, the Executive shall be entitled to participate in any and all employee benefit plans from time to time in effect for employees of the Company generally, except to the extent any such employee benefit plan is in a category of benefit otherwise provided to the Executive (e.g., a severance pay plan). Such participation shall be subject to the terms of the applicable plan documents and generally applicable Company policies.  Except as otherwise provided in any plan or agreement or as prohibited by law, the Company may alter, modify, add to or terminate its employee benefit plans at any time as it, in its sole judgment, determines to be appropriate, without recourse by the Executive.

 

Business Expenses and In-Kind Benefits.  The Company shall pay or reimburse the Executive for all reasonable business expenses incurred or paid by the Executive in the performance of his duties and responsibilities hereunder, subject to any maximum annual limit and other restrictions on such expenses set by the Board and to such reasonable substantiation and documentation as may be specified by the Company from time to time. Additionally, the Company 

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agreed to reimburse reasonable attorneys’ fees, up to a maximum of $10,000, incurred by the Executive in connection with the review and negotiation of the Original Employment Agreement prior to the Original Effective Date. Any reimbursement of expenses or the provision of any in-kind benefits that would constitute nonqualified deferred compensation subject to Section 409A of the Internal Revenue Code of 1986, as amended (along with the rules and regulations thereunder, “Section 409A”) shall be subject to the following additional rules: (A) no reimbursement of any such expense, or the provision of any in-kind benefit, shall affect the Executive’s right to reimbursement of any other such expense, or the provision of any in-kind benefit, in any other taxable year; (B) reimbursement of the expense shall be made, if at all, not later than the end of the calendar year following the calendar year in which the expense was incurred; and (C) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for any other benefit.

 

Termination of Employment and Severance Benefits. The Executive’s employment hereunder shall terminate under the circumstances specified in this Section 5. The effective date of any such termination of employment is hereinafter referred to as the “Termination Date”.

 

Death.  In the event of the Executive’s death during the Term, the Executive’s employment hereunder shall immediately and automatically terminate. In such event, the Executive’s estate shall be entitled to receive: (i) (A) any Base Salary earned but not paid during the final payroll period of the Executive’s employment through the date of termination, including pay for any vacation time earned but not used through the date of termination, payable in accordance with the Company’s regular payroll practices on the Company’s next regular pay date following the Termination Date (or earlier, if so required by applicable law) and (B) any business expenses incurred by the Executive but un-reimbursed on the date of termination, provided that such expenses and required substantiation and documentation are submitted within sixty (60) days of termination, that such expenses are reimbursable under Company policy, and that any such expenses subject to the last sentence of Section 4(g) shall be paid not later than the deadline specified therein (all of the foregoing, subject to the timing of payment rules therein, “Final Compensation”) and (ii) any annual bonus compensation awarded for the fiscal year immediately preceding the year in which termination of employment occurs, but unpaid on the Termination Date, payable at the same time as bonuses are paid to Company executives generally; provided, however, that if paying such amount on the date on which bonuses are paid to Company executives generally would result in an additional tax on the Executive or his estate under Section 409A, then such bonus shall be payable no later than June 15 of the year of the Termination Date. The Company shall have no further obligation to the Executive hereunder.

 

Disability.

 

The Company may terminate the Executive’s employment hereunder, upon notice to the Executive, in the event that the Executive becomes disabled during his employment hereunder through any illness, injury, accident or condition of either a physical or psychological nature and, as a result, is unable to perform substantially all of his duties and responsibilities hereunder, notwithstanding the provision of any reasonable accommodation, for ninety (90) days during any period of three hundred and sixty-five (365) consecutive calendar days. In the event of such termination, the Company shall have no further obligation to the Executive, other than for payment of (i) Final Compensation and (ii) any annual bonus compensation awarded for the fiscal year immediately preceding the year in which termination of employment occurs, but unpaid on the Termination Date, payable at the same time as bonuses are paid to Company executives generally; provided, however, that if paying such amount on the date on which bonuses are paid to Company executives generally would result in an additional tax on the Executive or his estate under Section 409A, then such bonus shall be payable no later than June 15 of the year of the Termination Date.

 

The Board may designate another employee to act in the Executive’s place during any period of the Executive’s disability.  Notwithstanding any such designation, the Executive shall continue to receive the Base Salary in accordance with Section 4(a) and benefits in accordance with Section 4(f), to the extent permitted by the then-current terms of the applicable benefit plans, until the Executive becomes eligible for long-term disability income benefits under the Company’s long-term disability income plan or until the termination of his employment, whichever shall first occur. Notwithstanding anything in this Section 5(b)(ii) to the contrary, and for the avoidance of doubt, the combination of Base Salary and short-term disability income benefits (if any) during the period of Executive’s disability shall not exceed the amount of compensation and benefits that the Executive would have received during such period had the Executive been actively at work during such period.

 

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While receiving long-term disability income payments under the Company’s long-term disability income plan, the Executive shall not be entitled to receive any Base Salary under Section 4(a) hereof, but shall continue to participate in Company benefit plans in accordance with Section 4(f) and subject to the terms of such plans, until the termination of his employment.

 

If any question shall arise as to whether during any period the Executive is disabled through any illness, injury, accident or condition of either a physical or psychological nature so as to be unable to perform substantially all of his duties and responsibilities hereunder, the Executive may, and at the request of the Company shall, submit to a medical examination by a physician selected by the Company to whom the Executive or his duly appointed guardian, if any, has no reasonable objection to determine whether the Executive is so disabled and such determination shall for the purposes of this Agreement be conclusive of the issue. If such question shall arise and the Executive shall fail to submit to such medical examination, the Company’s determination of the issue shall be binding on the Executive.

 

By the Company for Cause.  The Company may terminate the Executive’s employment hereunder for Cause at any time upon notice to the Executive setting forth in reasonable detail the nature of such Cause. The following, as determined by the Board in its reasonable judgment, shall constitute Cause for termination:

 

refusal or failure to perform (other than by reason of disability), or material negligence in the performance of the Executive’s duties and responsibilities to the Company or its Affiliates, which refusal or failure to perform or material negligence is not cured within 30 days after written notice from the Company or such Affiliates;

 

commission of, indictment for, conviction of or plea of guilty or nolo contendere to a felony or any crime involving moral turpitude, fraud, embezzlement or theft;

breach of fiduciary duties (including a violation of the Company’s or any of its Affiliate’s code of ethics) on the part of the Executive;

 

gross negligence or willful misconduct in the performance of employment, which negligence or misconduct is not cured within 30 days after written notice from the Company, and which willful act or misconduct could reasonably be expected to be injurious to the financial condition or business reputation of the Company or any of its Affiliates;

 

the material breach by Executive of any provision of any agreement to which such Executive and the Company or any or its Affiliates are party; or

 

breach by the Executive of the terms of Exhibit A of the Executive’s Unit Award Agreement, as in effect from time to time (the “Restrictive Covenants”).

 

Upon the giving of notice of termination of the Executive’s employment hereunder for Cause, the Company shall have no further obligation to the Executive, other than for his Final Compensation.

 

By the Company Other than for Cause.

 

The Company may terminate the Executive’s employment hereunder other than for Cause at any time upon written notice to the Executive.

 

In the event of the Executive’s Separation from Service pursuant to this Section 5(d), in addition to Final Compensation, the Executive will be entitled to the following payments and benefits, provided that the Executive satisfies all conditions to such entitlement, including without limitation, continued compliance with the Restrictive Covenants and signing and returning to the Company a timely and effective Employee Release in accordance with subsection (iii) below:

 

Until the conclusion of a period of the twelve (12) months following the Termination Date, the Company shall continue to pay the Executive the Base Salary at the rate in effect on the Termination Date, and, subject to any employee contribution applicable to the Executive on the Termination Date, shall continue to contribute to the premium cost of the Executive’s participation in the Company’s group medical and dental plans, provided that the Executive is entitled to continue such participation under applicable law and plan terms.

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Executive shall be paid any annual bonus compensation awarded for the fiscal year immediately preceding the year in which termination of employment occurs, but unpaid on the Termination Date.  Such bonus shall be payable in the year of the Termination Date at the same time as bonuses are paid to Company executives generally; provided, however, that if paying such amount on the date on which bonuses are paid to Company executives generally would result in an additional tax on the Executive or his estate under Section 409A, then such bonus shall be payable no later than June 15 of the year of Termination Date.

 

Any obligation of the Company to the Executive hereunder, other than for his Final Compensation, is conditioned, however, on the Executive’s timely and effective execution of the form of release included with this Agreement as Exhibit A, by the deadline specified therein (any such release submitted by such deadline, the “Employee Release”) and delivering it to the Company not later than the deadline specified therein, which shall not be later than the sixtieth (60th) calendar day following the date of his Separation from Service.  Subject to Section 5(g) below, severance pay to which the Executive is entitled hereunder shall be payable in accordance with the normal payroll practices of the Company, with the first payment, which shall be retroactive to the day immediately following the Termination Date, being due and payable on the Company’s next regular payday for executives that follows the expiration of sixty (60) calendar days from the Termination Date. The Release of Claims required for separation benefits in accordance with this Section 5(d) or Section 5(e) creates legally binding obligations on the part of the Executive and the Company therefore advises the Executive to seek the advice of an attorney before signing it.

 

By the Executive for Good Reason.

 

The Executive may terminate his employment hereunder for Good Reason (A) by providing notice to the Company specifying in reasonable detail the condition giving rise to the Good Reason no later than thirty (30) days following the occurrence of that condition; (B) by providing the Company a period of thirty (30) days to remedy the condition and so specifying in the notice and (C) by terminating his employment for Good Reason within thirty (30) days following the expiration of the period to remedy if the Company fails to remedy the condition.

 

For purposes of this Agreement, “Good Reason” shall mean the occurrence of any one or more of the following conditions without the Executive’s consent:  (A) a material adverse change in the Executive’s responsibilities, duties and/or authority that, taken as a whole, constitutes a breach of Section 3(a) hereof and effectively constitutes a demotion; provided, however, that the failure to continue the Executive’s appointment or election as a member of the Board or director or officer of Holdings or any of its Affiliates, a change in reporting relationships resulting from a reorganization of Holdings or the Company or from a change in the direct or indirect control of the Company (or a successor corporation) by another corporation and any diminution of the business of the Company or any of its Affiliates or any sale or transfer of equity, property or other assets of Holdings, the Company or any of their Affiliates shall not constitute “Good Reason,”  (B)  material diminution in the Base Salary, or (C) requiring Executive to relocate outside Lake Elmo, Minnesota.

 

In the event of a Separation from Service in accordance with this Section 5(e), and provided that no benefits are payable to the Executive under a separate severance agreement or an executive severance plan as a result of such termination or, if any such benefits are payable, that the Executive waives his rights thereto, then, in addition to Final Compensation, the Executive will be entitled to the severance benefits provided in Section 5(d)(ii) above; provided that the Executive satisfies all conditions to such entitlement, including without limitation the signing and return to the Company of a timely and effective Employee Release in accordance with Section 5(d)(iii) above.

 

By the Executive Other than for Good Reason.  The Executive may terminate his employment hereunder at any time upon thirty (30) days’ notice to the Company. In the event of the Executive’s termination of employment pursuant to this Section 5(f), the Company may elect to waive all or any part of the period of notice, and, if the Company so elects, the Company will pay the Executive his Base Salary for portion of the notice period so waived.  The Company shall have no further obligation to the Executive, other than for his Final Compensation.

 

Timing of Payments; Definition of “Separation from Service.” If at the time of the Executive’s Separation from Service the Executive is a “specified employee,” as hereinafter defined, any and all amounts payable under this Section 5 in connection with such Separation from Service that constitute deferred compensation subject to Section 409A, as determined by the Company in its sole discretion, and that would (but for this sentence) be payable within 

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six months following such Separation from Service, shall instead be paid on the date that follows the date of such Separation from Service by six (6) months. For purposes of this Agreement, “Separation from Service” (and correlative terms such as “Separate from Service”) shall mean a “separation from service” as defined in Treas. Regs. § 1.409A-1(h), and the term “specified employee” shall mean an individual determined by the Company to be a specified employee under Treas. Regs. § 1.409A-1(i).

 

Effect of Termination.  The provisions of this Section 6 shall apply to any termination of the Executive’s employment hereunder.

 

Other than as described in Sections 5(d) and 5(e), above, payment by the Company of any Base Salary and contributions to the cost of the Executive’s continued participation in the Company’s group health and dental plans that may be due the Executive shall constitute the entire obligation of the Company to the Executive.  Other than as described in Section 5(d)(ii), above, medical, dental and other benefits shall terminate pursuant to the terms of the applicable benefit plans based on the date of the Executive’s Separation from Service without regard to any continuation of Base Salary or other payment to the Executive following such Separation from Service, except for any right of the Executive to continue participation pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”) or other applicable law.

 

Provisions of this Agreement shall survive any Separation from Service if so provided herein or if necessary or desirable to accomplish the purposes of other surviving provisions, including without limitation the obligations of the Executive under Section 7 hereof and the Restrictive Covenants.  The obligation of the Company to make payments to or on behalf of the Executive under Section 5(d), 5(e) hereof is expressly conditioned upon the Executive’s continued full performance of his obligations under the Restrictive Covenants. The Executive recognizes that, except as expressly provided in Section 5(d) or 5(e), no compensation is earned after the Termination Date.  The Executive’s right to receive and retain the payments provided under Section 5(d) or 5(e) hereof (other than for his Final Compensation) are expressly conditioned on his continued compliance with his obligations under the Restrictive Covenants and Section 7 hereof.

 

Non-Disparagement.  The Executive shall not make or induce other persons or entities to make any negative statements about the Company, its Affiliates, employees, past or present officers, directors, managers, products, services, businesses or reputation. Notwithstanding the foregoing, truthful statements made in the course of sworn testimony in administrative, judicial or arbitral proceedings (including, without limitation, depositions taken in connection with such proceedings) shall not be subject to this Section 7.

 

Withholding.  All payments made by the Company under this Agreement shall be reduced by any tax or other amounts required to be withheld by the Company under applicable law.

 

Indemnification.  The Company and the Executive shall, as soon as practicable following and contingent upon the occurrence of the Exchange (as defined below), enter into a directors and officers indemnification agreement substantially in the form attached hereto as Exhibit B, which shall provide coverage to the Executive effective as of the closing of the transactions contemplated by that certain Share Contribution & Exchange Agreement by and among Skyline Corporation and Champion Enterprises Holdings, LLC, made and entered into as of January 5, 2018 (the “Exchange”).

 

Assignment.  Except as is specifically set forth below, neither the Company nor the Executive may make any assignment of this Agreement or any interest herein, by operation of law or otherwise, without the prior written consent of the other; provided, however, that the Company may assign its rights and obligations under this Agreement without the consent of the Executive in the event that the Executive is transferred to a position with any of the Affiliates, or in the event that the Company shall hereafter effect a reorganization, consolidate with, or merge into, any Person or transfer all or substantially all of its properties or assets to any Person.This Agreement shall inure to the benefit of and be binding upon the Company and the Executive, their respective successors, executors, administrators, heirs and permitted assigns.

 

Severability. If any portion or provision of this Agreement shall to any extent be declared illegal or unenforceable by a court of competent jurisdiction, then the remainder of this Agreement, or the application of such portion or provision in circumstances other than those as to which it is so declared illegal or unenforceable, shall not be affected thereby, 

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and each portion and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.

 

Waiver.  No waiver of any provision hereof shall be effective unless made in writing and signed by the waiving party. The failure of either party to require the performance of any term or obligation of this Agreement, or the waiver by either party of any breach of this Agreement, shall not prevent any subsequent enforcement of such term or obligation or be deemed a waiver of any subsequent breach.

Notices.  Any and all notices, requests, demands and other communications provided for by this Agreement shall be in writing and shall be effective when delivered in person, consigned to a reputable national courier service or deposited in the United States mail, postage prepaid, registered or certified, and addressed to the Executive at his last known address on the books of the Company or, in the case of the Company, at its principal place of business, attention of the Chair of the Board, or to such other address as either party may specify by notice to the other actually received.

 

Entire Agreement.  This Agreement constitutes the entire agreement between the parties and supersedes all prior communications, agreements and understandings, written or oral, with respect to the terms and conditions of the Executive’s employment.

 

Amendment.  This Agreement may be amended or modified only by a written instrument signed by the Executive and by an expressly authorized representative of the Company.

 

Headings. The headings and captions in this Agreement are for convenience only and in no way define or describe the scope or content of any provision of this Agreement.

 

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

 

Governing Law.  This is a Michigan contract and shall be construed and enforced under and be governed in all respects by the laws of the State of Michigan without regard to the conflict of laws principles thereof.

 

Definitions.

 

“Affiliate” means, with respect to any specified Person at any time, any other Person that directly or indirectly controls, or is controlled by, or is under common control with, such specified Person at such time.

 

“Class C Units” means the units of interests in Holdings designated as “Class C Units” and having the relative rights, preferences, privileges, limitations and qualifications set forth in Holdings’ Second Amended and Restated Limited Liability Company Agreement, Holdings’ 2011 Management Incentive Plan (each, as in effect from time to time) and, in the case of each Class C Unit, the applicable award agreement pursuant to which such Class C Unit was granted.

 

“Person” means any natural person, corporation, limited liability company, partnership, trust, joint stock company, business trust, unincorporated association, joint venture, governmental authority or other legal entity of any nature whatsoever.

 

 

[Signature page follows immediately.]

 

 

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IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument by the Company, by its duly authorized representative, and by the Executive, as of the date first above written.

 

	
THE EXECUTIVE:
	
 
	
THE COMPANY

 

By: --

Title: Senior Vice President and General Counsel

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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TN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument by the Company, by its duly authorized representative, and by the Executive, as of the date first above written.

 

	
THE EXECUTIVE:
	
 
	
THE COMPANY

 

 

By:

Title: Senior Vice President and General Counsel

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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EXHIBIT A

RELEASE OF CLAIMS

FOR AND IN CONSIDERATION OF the payments to be provided me in connection with the termination of my employment under the applicable provision of Section 5 of the amended and restated agreement between me and Champion Home Builders, Inc. (the “Company”) dated as of June 4, 2018 (the “Agreement”), which are conditioned on my signing this Release of Claims and to which I am not otherwise entitled, I, on my own behalf and on behalf of my heirs, executors, administrators, beneficiaries, representatives and assigns, and all others connected with or claiming through me, hereby release and forever discharge the Company, its subsidiaries and other Affiliates and all of their respective past, present and future officers, directors, managers, trustees, shareholders, employees, agents, general and limited partners, members, managers, joint venturers, employee benefits plans, representatives, successors and assigns, and all others connected with any of them, both individually and in their official capacities, from any and all causes of action, rights or claims of any type or description, known or unknown, which I have had in the past, now have, or might now have, through the date of my signing of this Release of Claims, in any way resulting from, arising out of or connected with my employment by the Company or any of its subsidiaries or other Affiliates or the termination of that employment or pursuant to any federal, state or local law, regulation or other requirement (including without limitation Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with Disabilities Act, and the fair employment practices laws of the state or states in which I have been employed by the Company or any of its subsidiaries or other Affiliates, each as amended from time to time).

 

Excluded from the scope of this Release of Claims is (i) any claim arising under the terms of the Agreement after the effective date of this Release of Claim, (ii) any right of indemnification or contribution that I have pursuant to the Articles of Incorporation and/or By-Laws of the Company or any of its subsidiaries or other Affiliates, (iii) any right of indemnification or contribution that I have pursuant to any Directors & Officers indemnification or ERISA insurance policies secured by the Company or any of its subsidiaries or other Affiliates, (iv) any whistleblower or anti-retaliation law, each as may have been or may be amended, and (v) any other claims which are, by law, not waivable.

 

In signing this Release of Claims, I acknowledge my understanding that I may not sign it prior to the termination of my employment, but that I may consider the terms of this Release of Claims for up to twenty-one (21) days (or such longer period as the Company may specify) from the later of the date my employment with the Company terminates or the date I receive this Release of Claims, provided that this Release of Claims, signed and dated by me, is received not later than the sixtieth (60th) day following the date my employment with the Company terminated by the person designated under the Agreement to receive notices on behalf of the Company in order for me to qualify for benefits under the applicable provision of Section 5 of the Agreement. I also acknowledge that I am advised by the Company and its subsidiaries and other Affiliates to seek the advice of an attorney prior to signing this Release of Claims; that I have had sufficient time to consider this Release of Claims and to consult with an attorney, if I wished to do so, or to consult with any other person of my choosing before signing; and that I am signing this Release of Claims voluntarily and with a full understanding of its terms.

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I further acknowledge that, in signing this Release of Claims, I have not relied on any promises or representations, express or implied, that are not set forth expressly in the Agreement.  I understand that I may revoke this Release of Claims at any time within seven (7) days of the date of my signing by written notice to the person designated under the Agreement to receive notices on behalf of the Company and that this Release of Claims will take effect only upon the expiration of such seven-day revocation period and only if I have not timely revoked it.

 

Intending to be legally bound, I have signed this Release of Claims under seal as of the date written below.

 

	
Signature:  
	
 
	
 

	
 
	
 
	
 

	
Name (please print):  
	
 
	
 

	
 
	
 
	
 

	
Date Signed:  
	
 
	
 

 

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EXHIBIT B

INDEMNIFICATION AGREEMENT

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Exhibit 10.1
Workday, Inc.
Change in Control Policy
(April 22, 2021)

						
	ELIGIBILITY	Executive officers for purposes of Section 16 of the Exchange Act of 1934, as amended (“Section 16 Officers”), other Executive Vice Presidents, and other employees designated by the Board of Directors or the Compensation Committee of the Board of Directors of Workday, Inc. (“Workday”) are eligible to participate in the Change in Control Policy (each, a “Participant”). A Participant shall cease to be a Participant under the Policy (i) upon termination of employment with Workday prior to a Change in Control (as defined below), (ii) in the event such Participant is no longer either a Section 16 Officer or an Executive Vice President, or (iii) upon the recommendation of a Co-Chief Executive Officer or the Chief People Officer and confirmation by the Board of Directors or Compensation Committee.
	BENEFITS	Under this Change in Control Policy, in the event of a Qualifying Termination in connection with a Change in Control (as each is defined below) and contingent upon the Participant’s execution and non-revocation of a binding separation and release agreement within 60 days following the Qualifying Termination in a form acceptable to Workday, the Participant will be entitled to receive: 

(i)If the Participant was serving as a Chief Executive Officer or Co-Chief Executive Officer immediately prior to the Change in Control: 

a.A lump sum cash payment in an amount equal to two times such Participant’s annual base salary as in effect immediately prior to the actions that resulted in the Qualifying Termination or the Change in Control, whichever is greater, less applicable withholding taxes; 

b.A lump sum cash payment in an amount equal to two times such Participant’s annual target cash bonus for the period immediately prior to the actions that resulted in the Qualifying Termination or the Change in Control, whichever is greater, less applicable withholding taxes;

c.Accelerated vesting of 100% of the amount of Participant’s unvested equity awards (excluding Performance Awards (as defined below)) immediately prior to the Qualifying Termination. With respect to awards that would otherwise vest only upon satisfaction of performance criteria (“Performance Awards”), the vesting will accelerate as set forth in the terms of the applicable performance-based award agreement; and

d.A lump sum cash payment in an amount equal to an estimate of the aggregate premiums for continuation coverage for twenty-four months pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), less applicable withholding taxes. 

						
		(ii)If the Participant was serving in a role other than Chief Executive Officer or Co-Chief Executive Officer immediately prior to the Change in Control: 

a.A lump sum cash payment in an amount equal to such Participant’s annual base salary as in effect immediately prior to the actions that resulted in the Qualifying Termination or the Change in Control, whichever is greater, less applicable withholding taxes; 

b.A lump sum cash payment in an amount equal to such Participant’s annual target cash bonus for the period immediately prior to the actions that resulted in the Qualifying Termination or the Change in Control, whichever is greater, less applicable withholding taxes;

c.Accelerated vesting of 100% of the amount of Participant’s unvested equity awards (excluding Performance Awards) immediately prior to the Qualifying Termination. With respect to Performance Awards, the vesting will accelerate as set forth in the terms of the applicable performance-based award agreement; and

d.A lump sum cash payment in an amount equal to an estimate of the aggregate premiums for continuation coverage for twelve months pursuant to COBRA, less applicable withholding taxes.

The foregoing benefits payable in cash will be provided on Workday’s first customary payroll date following the sixty-first (61st) day following the Qualifying Termination.

	DEFINITIONS	A “Change in Control” shall be deemed to have occurred if any one of the following events shall have occurred: 

(i)any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934 (the “Exchange Act”)) other than Workday’s founders or a trust, foundation or other estate planning vehicle established by one of Workday’s founders, becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of securities representing fifty percent (50%) or more of the total voting power represented by Workday’s then-outstanding voting securities; 

(ii)the consummation of the sale or disposition of all or substantially all of Workday’s assets; or

(iii)the consummation of a merger or consolidation of Workday with any other corporation, other than a merger or consolidation which would result in Workday’s voting securities outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its parent) at least fifty percent (50%) of the total voting power represented by our voting securities or such surviving entity or its parent outstanding immediately after such merger or consolidation.

						
		A “Qualifying Termination” shall be an involuntary termination of Participant’s employment upon or within twelve months following a Change in Control other than for “Cause,” death, or “Disability” (as defined in Section 409A of the Code) or a voluntary resignation for “Good Reason.”

“Cause” shall mean: 

(i)Gross negligence or misconduct in the performance of Participant’s duties;

(ii)Participant’s conviction or a plea of “guilty” or “no contest” for (x) a felony or (y) any violent crime or crime involving theft, dishonesty, moral turpitude, or money laundering;

(iii)Participant’s negligent or intentional act or omission which is, or is reasonably likely to be, materially injurious to the financial condition or reputation of Workday or its affiliates; 

(iv)Participant’s breach of Workday’s standard Proprietary Information and Inventions Agreement; or

(v)Participants breach of Workday’s written policies and procedures, including without limitation a code of conduct, or any contract or agreement between Participant and Workday, in either case which is, or is reasonably likely to be, materially injurious to the financial condition or reputation of Workday or its affiliates.

“Good Reason” shall mean: 

(i)any material reduction in Participant’s Base Salary or target bonus opportunity (excluding a reduction affecting substantially all similarly situated Participants or any change in the value of equity incentives);
 
(ii)the relocation of the Participant’s primary work location such that Participant’s one-way commute is increased by more than fifty (50) miles; or 

(iii)a material diminution to Participant’s duties and responsibilities as in effect immediately prior to a Change in Control;
 
provided that any of the events described in clauses (i)-(iii) of this section shall constitute Good Reason only if Workday fails to cure such event within 30 days after receipt from Participant of written notice of the event which constitutes Good Reason and Participant resigns his or her employment within 30 days following expiration of such cure period; provided, further, that Good Reason shall cease to exist for an event on the 90th day following its initial occurrence, unless Participant has given Workday written notice thereof prior to such date. The notice provided by Participant to Workday must set forth in reasonable detail the specific conduct of Workday that constitutes Good Reason and the specific provision(s) of this definition on which the Participant is relying.

The “Code” shall mean the Internal Revenue Code of 1986, as amended. 

						
	POLICY EFFECTIVENESS;  TERMINATION	This Change in Control Policy is effective as of April 22, 2021, the date it was approved by the Compensation Committee of the Board, and replaces and supersedes in its entirety the Change in Control Policy which was effective as of September 3, 2020 and any prior versions of this Change in Control Policy.  The Change in Control Policy will be reviewed regularly by the Compensation Committee, and may be amended or terminated by the Compensation Committee or Board of Directors. Notwithstanding anything herein to the contrary, in no event shall any amendment or termination adversely affect the rights of any Participant who is then receiving or entitled to receive payments or benefits under this Change in Control Policy, without the prior written consent of such Participant.
	SUCCESSORS	Workday shall require any successor (whether pursuant to a Change in Control, direct or indirect, and whether by purchase, merger, consolidation, liquidation or otherwise) to all or substantially all of the business and/or assets of Workday to expressly assume and agree to perform the obligations under this Policy in the same manner and to the same extent as Workday would be required to perform in the absence of such a succession of Workday.  For all purposes of this Policy, the term “Workday” shall include any successor to Workday’s business and/or assets or which becomes bound by this Policy by operation of law.
	EXCLUSIVE BENEFIT ELECTION	In order to be eligible to participate in the Change in Control Policy, the Participant must opt in to the Change in Control Policy and waive any existing severance arrangement that would be triggered by a Change in Control or similar transaction.
	280G BEST-OF PROVISION	If the benefits described in the Change in Control Policy constitute “parachute payments” within the meaning of the Code and would be subject to the excise tax imposed by Section 4999 of the Code, then at the Participant’s discretion, the benefits will be payable either (i) in full, or (ii) as to such lesser amount which would result in no portion of such benefits being subject to the excise tax under Section 4999 of the Code, whichever of the foregoing amounts (taking into consideration applicable taxes, including the excise tax under Section 4999) would result in the receipt by Participant on an after-tax basis of the greatest amount of benefits (even if some of such benefits are taxable under Section 4999). 

	SECTION 409A	For purposes of this Change in Control Policy, no payment will be made to any Participant upon termination of the Participant’s employment unless such termination constitutes a “separation from service” within the meaning of Section 409A of the Code.  It is intended that the right of any Participant to receive installment payments pursuant to this Change in Control Policy shall be treated as a right to receive a series of separate and distinct payments for purposes of Section 409A of the Code.  It is further intended that all payments and benefits hereunder satisfy, to the greatest extent possible, the exemption from the application of Section 409A of the Code (and any state law of similar effect) provided under Treasury Regulation Section 1.409A-1(b)(4) (as a “short-term deferral”) and are otherwise exempt from or comply with Section 409A of the Code.  Accordingly, to the maximum extent permitted, this Change in Control Policy shall be interpreted in accordance with that intent.  To the extent necessary to comply with Section 409A of the Code, if the designated payment period for any payment under this Change in Control Policy begins in one taxable year and ends in the next taxable year, the payment will commence or otherwise be made in the later taxable year.  For purposes of Section 409A of the Code, if Workday determines that a Participant is a “specified employee” under Section 409A(a)(2)(B)(i) of the Code at the time of his or her separation from service, then to the extent delayed commencement of any portion of the payments or benefits to which the Participant is entitled pursuant to this Change in Control Policy is required in order to avoid a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code, such portion shall not be provided to the Participant until the earlier (i) the expiration of the six-month period measured from the Participant’s separation from service or (ii) the date of the Participant’s death.

						
		As soon as administratively practicable following the expiration of the applicable Section 409A(2)(B)(i) period, all payments deferred pursuant to the preceding sentence shall paid in a lump-sum to the Participant and any remaining payments due pursuant to the Change in Control Policy shall be paid as otherwise provided herein.

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