Document:

Exhibit 10.1

 

CONTINGENT EMPLOYMENT AGREEMENT

 

THIS
AGREEMENT, made this          day of
          ,
20      , by and between THE MANITOWOC COMPANY,
INC., a Wisconsin corporation (together with its subsidiaries and any upstream
parent company that in the future may control The Manitowoc Company, Inc.
referred to herein as the “Company”) and
                                              ,
(the “Employee”).

 

RECITALS

 

WHEREAS, sudden takeovers, acquisitions or changes of
control of domestic corporations have occurred frequently in recent years, and
current conditions may contribute to the continuation or acceleration of this
trend; and

 

WHEREAS, the possibility of a sudden takeover, acquisition
or change of control can create uncertainty of employment and may distract
and/or cause the loss of valuable Company officers, to the detriment of the
Company and its shareholders; and

 

WHEREAS, it is believed that the detriment described can be
substantially reduced by agreement on the terms hereinafter set forth.

 

AGREEMENT

 

NOW THEREFORE, in consideration of the foregoing premises
and the mutual covenants hereinafter set forth, IT IS AGREED

 

1.             Continued Employment.

 

(a)           If a “Change of Control” (as
defined below) of the Company occurs when the Employee is employed by the
Company, the Company will continue thereafter to employ the Employee, and the
Employee will remain in the employ of the Company, in accordance with the terms
and provisions of this Agreement, for a period of three (3) years following the
date of such change (the “Employment Period”).

 

(b)           As used herein, the phrase “Change
of Control” of the Company means the first to occur of the following with
respect to the Company or any upstream holding company:

 

(i)            Any “person,” as that term
is defined in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934 (the “Exchange Act”), but excluding the Company, any trustee or other
fiduciary holding securities under an employee benefit plan of the Company, or
any corporation owned, directly or indirectly, by the stockholders of the
Company in substantially the same proportions as their ownership of 

 

 

stock of the Company, is or
becomes the “beneficial owner” (as that term is defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company
representing 30% or more of the combined voting power of the Company’s then
outstanding securities;

 

(ii)           The Company is merged or
consolidated with any other corporation or other entity, other than: (A) a
merger or consolidation which 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) more than 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) the Company engages in a merger
or consolidation effected to implement a recapitalization of the Company (or
similar transaction) in which no “person” (as defined above) acquires more than
30% of the combined voting power of the Company’s then outstanding
securities.  Notwithstanding the
foregoing, a merger or consolidation involving the Company shall not be
considered a “Change of Control” if the Company is the surviving corporation
and shares of the Company’s Common Stock are not converted into or exchanged
for stock or securities of any other corporation, cash or any other thing of
value, unless persons who beneficially owned shares of the Company’s Common
Stock outstanding immediately prior to such transaction own beneficially less
than a majority of the outstanding voting securities of the Company immediately
following the merger or consolidation;

 

(iii)          The Company or any
subsidiary sells, assigns or otherwise transfers assets in a transaction or
series of related transactions, if the aggregate market value of the assets so
transferred exceeds 50% of the Company’s consolidated book value, determined by
the Company in accordance with generally accepted accounting principles,
measured at the time at which such transaction occurs or the first of such
series of related transactions occurs; provided, however, that such a transfer
effected pursuant to a spin-off or split-up where stockholders of the Company
retain ownership of the transferred assets proportionate to their prorata
ownership interest in the Company shall not be deemed a “Change of Control;”

 

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(iv)          The Company dissolves and
liquidates substantially all of its assets;

 

(v)           At any time after the date
of this Agreement when the Continuing Directors cease to constitute a majority
of the Board of Directors of the Company. 
For this purpose, a “Continuing Director” shall mean: (A) the
individuals who, at the date of this Agreement constitute the Board; and (B)
any new directors (other than directors designated by a person who has entered
into an agreement with the Company to effect a transaction described in
clause (i), (ii) or (iii) of this paragraph 1(b) of this Agreement) whose
appointment to the Board or nomination for election by the Company’s
stockholders was approved by a vote of at least two-thirds of the then-serving
Continuing Directors; or

 

(vi)          A determination by the Board
of Directors of the Company, in view of then current circumstances or impending
events, that a Change of Control of the Company has occurred, which
determination shall be made for the specific purpose of triggering the
operative provisions of this Agreement and all other similar contingent
employment agreements of the Company.

 

2.             Duties.  Unless otherwise agreed by the Company and
Employee, during the Employment Period the Employee shall be employed by the
Company in the same position/ offices as those which the Employee held on the
date of the Change of Control of the Company. 
In such employment the Employee’s duties and authority shall consist of
and include all duties and authority customarily performed and held by a person
holding an equivalent position with a corporation of similar nature and size,
as such duties and authority related to such position are reasonably defined
and delegated from time to time by the Board of Directors of the Company.  However, no change of the Employee’s location
of employment outside a 50-mile radius from his place of employment as of the
date of this Agreement (or any other location later consented to by the
Employee), or in the Employee’s title, shall be made without the prior written
consent of the Employee.  The Employee
shall have the powers necessary to perform the duties assigned and shall be
provided such supporting services, staff, secretarial and other assistance,
office space and accouterments as shall be reasonably necessary and appropriate
in light of the duties assigned (but in no event, in any case, smaller in
quantity or size or inferior in quality than that being furnished to the
Employee on the date of the Change of Control of the Company).

 

The
Employee shall devote his entire business time, energy and skills to such
employment while so employed, but the Employee shall not be required to devote
more than an average of approximately 40 hours per calendar week to such
employment.  The Employee may participate
in civic or charitable activities which do not adversely affect his ability to
carry out his responsibilities hereunder. 
The Employee shall be 

 

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entitled
to a minimum of three weeks (fifteen working days) of paid vacation annually,
or such greater amount as shall be customarily allowed to the Employee during
the fiscal year of the Company prior to the fiscal year in which the Change of
Control of the Company shall occur.  The
Employee shall have the sole discretion to determine the time and intervals of
such vacation.

 

3.             Compensation.  While employed under this Agreement, the
Employee shall be compensated as follows:

 

(a)           The Employee shall receive a
salary equal to his salary as in effect as of the date of the Change of Control
of the Company, subject to adjustment as hereinafter provided.

 

(b)           The Employee shall be
reimbursed for any and all monies advanced in connection with his employment
for reasonable and necessary expenses incurred by him on behalf of the Company.

 

(c)           The Employee shall be
included to the extent eligible thereunder in any and all plans providing
benefits for the Company’s employees, including but not limited to group life
insurance, hospitalization, medical, retiree health and pension, and shall be
provided any and all other benefits and perquisites made available to other
employees of comparable status, at the expense of the Company on a comparable
basis.  The Employee shall be deemed
eligible for retiree health if he is a participant in the Company’s retiree
health plan and qualifies on the basis of years or service (regardless of his
age).

 

(d)           The Employee shall be
permitted to participate in any restricted stock plans, stock option plans or
other stock benefit plans as the Company establishes and maintains from time to
time for its officers and employees.  The
Employee’s participation level in such stock plans shall be consistent with the
participation level of other officers and employees of the Company who have
positions, duties and responsibilities comparable to the Employee.

 

(e)           The Employee shall be
included in all profit sharing, bonus, deferred compensation, split dollar life
insurance, and similar or comparable cash incentive bonus plans customarily
extended by the Company to corporate officers and key employees of the
Company.  The Employee shall be entitled
to participate in cash incentive bonuses and profit sharing under such plans
which are consistent with the bonuses and profit sharing received under such
plans by other employees and officers of the Company who have positions, duties
and responsibilities comparable to those of the Employee provided that such
plans and bonus opportunity shall be no less favorable to the Employee than the
plans and bonus opportunity that existed immediately prior to the Change of
Control.

 

4.             Annual Compensation
Adjustments.  At least
annually during the Employment Period, the Board of Directors of the Company or
an appropriate committee thereof, in accordance with past practice, will
consider and appraise the 

 

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contributions of the Employee to the Company’s
operating efficiency, growth, production and profits, and the Employee’s
compensation rate shall be eligible for increase based upon Employee’s
contributions to the Company and the increases provided to other corporate
officers and key employees generally and as the scope and success of the
Company’s operations or the Employee’s duties expand.

 

5.             Disability.  If, during the Employment Period, the
Employee shall become disabled by sickness or otherwise so that he is unable to
perform the regular duties of his employment on a full-time basis, the Company
shall pay him commencing on the date of the disability and continuing for the
first six months thereafter, as sick pay, his normal salary and all benefits as
described in paragraph 3 hereof.  If the
disability continues beyond six months, then the payment of the Employee’s
normal salary shall be suspended during the period of disability.  During the term of his disability, and until
the expiration of the Employment Period, the Employee shall continue to receive
customary fringe benefits as provided in paragraphs 3(c) and 3(d)
above.  The obligation to provide the
foregoing disability benefits shall survive the termination of this Agreement
provided the disability was incurred before termination.  If the disability terminates prior to the end
of the Employment Period, the Employee may elect to return to full-time
employment under this Agreement in which case this paragraph shall apply to all
subsequent short or long term disabilities.

 

To
determine whether the Employee is disabled for the purposes of this paragraph,
either party may from time to time request a medical examination of the
Employee by a doctor appointed by the Company, or as the parties may otherwise
agree, and the written medical opinion of such doctor shall be conclusive and
binding upon the parties as to whether or not the Employee has become disabled
and the date when such disability arose. 
The cost of any such medical examination shall be borne by the Company.

 

6.             Retirement.  If, during the Employment Period, the
Employee shall deliver to the Company a statement signed by him stating that
the Employee voluntarily chooses to retire early from the Company, or if the
Employee shall reach the age of 65, or shall with the mutual agreement of the
Company agree in writing on early retirement, then this Agreement shall
terminate on the effective date of such event and the terms of the Company’s
retirement policies or such mutual agreement shall immediately become
effective.

 

7.             Termination Other Than for
Cause.

 

(a)           At any time during the
ninety (90) calendar day period commencing on the date of completion of the
transaction or series of related transactions causing the occurrence of a
Change of Control (the “Trial Period”), the Employee shall have the right to
elect to terminate his employment under this Agreement for any reason or no
reason at all and shall thereupon be entitled to the benefits and a severance
payment as set forth in paragraph 7(c) below, however the payments as described
in paragraphs 7(c)(iii) and 7(c)(iv) shall be reduced by one-half (50%) in the
event the Employee terminates his employment pursuant to this paragraph 7(a)
without Good Reason.

 

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(b)           If during the Employment
Period the Employee shall elect to terminate his employment under this
Agreement for Good Reason, he shall thereupon be entitled to the benefits and a
severance payment as set forth in paragraph 7(c) below.  For purposes of this Agreement, a termination
for “Good Reason” means a termination by Employee based upon the occurrence
(without Employee’s express written consent) of any of the following:  (i) a material diminution in Employee’s position
or title, or the assignment of duties to Employee that are materially
inconsistent with Employee’s position or title as described in paragraph 2;
(ii) a material diminution in Employee’s base salary or incentive/bonus
opportunities; (iii) a change of more than fifty (50) miles from the location
of his principal place of employment on the date of the Change of Control of
the Company; or (iv) a material breach by the Company of any of its obligations
under this Agreement, or (v) any successor to the principal business of the
Company (whether by merger, purchase of assets, liquidation or otherwise) as
described in paragraph 12 fails or refuses to assume the Company’s obligations
under this Agreement.  Notwithstanding
the foregoing, no such event described above shall constitute Good Reason
unless Employee gives written notice to the Company specifying the
condition or event relied upon for such termination within ninety
(90) days of the initial existence of such event and (2) the Company
fails to cure the condition or event constituting Good Reason within thirty
(30) days following receipt of Employee’s notice.

 

(c)           If during the Employment
Period the Employee’s employment hereunder shall be terminated (1) by the
Company for any reason other than the reasons set forth paragraphs 5, 6, 8 or 9
of this Agreement, or (2) by the Employee pursuant to paragraph 7(a) or 7(b)
above, thereafter the Employee shall be entitled to participate in group life,
hospitalization and medical insurance described in paragraph 3(c) hereof, for
the lesser of (i) the remainder of the Employment Period (provided that if the
Employee would be eligible to participate in the Company’s retiree health plan
(based on years of service without regard to age) if he had retired as of the
termination date, he shall be entitled to participate in such retiree health
plan upon such termination), or (ii) the number of years (including partial
years) until the Employee reaches the age of 65, and, no later than thirty (30)
calendar days following such termination, the Company shall pay to the Employee
or his personal representative a severance payment in an amount equal to the
sum of the following:

 

(i)            The Employee’s annual base
salary through the date of the termination of employment to the extent not
theretofore paid; plus

 

(ii)           All deferred salary
(including “bank” balances in the Company’s incentive compensation plans),
profit sharing, bonuses and other compensation earned by the Employee (whether
vested or unvested or subject to any other contingencies) during the course of
his employment with the Company prior to the termination of his employment;
plus

 

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(iii)          The Employee’s base salary
for the lesser of (i) the portion of the Employment Period remaining unexpired
as of the termination date, or (ii) the number of years (including partial
years) from the Employee’s termination date until the Employee reaches the age
of 65  (subject to the 50% reduction if
the termination is pursuant to paragraph 7(a)). 
For this purpose, the Employee’s base salary shall be his base salary as
in effect immediately prior to the termination of employment.  For any fraction of a year included in the
unexpired portion of the Employment Period, the Employee’s base salary shall be
prorated based upon a 365-day year; plus

 

(iv)          Incentive bonus compensation
for the current fiscal year of the Company during which the termination of
employment occurs and for the lesser of (i) all subsequent fiscal years of the
Company thereafter which are included in whole or in part in the portion of the
Employment Period remaining unexpired as of the termination date, or (ii) the
number of years (including partial years) from the Employee’s termination date
until the Employee reaches the age of 65 (subject to the 50% reduction if the
termination is pursuant to paragraph 7(a)). 
The amount of the cash incentive bonus for any partial fiscal year
included in the balance of the Employment Period shall be prorated based on a
365-day fiscal year.  The amount of the
annual bonus to be applied in calculating the incentive compensation payment
shall be the average of the annual cash incentive bonuses earned by the
Employee (whether such incentive bonuses were paid in the year earned or
deferred for payment in subsequent years) under all short and long-term cash
incentive bonus plans maintained by the Company in which the Employee
participated during the Company’s latest three consecutive fiscal years ended
prior to the termination of the Employee’s employment.  If the Employee has been employed by the
Company for less than three complete fiscal years prior to the date of the
termination of his employment, then the amount of the annual bonus for purposes
of computing these payments shall be based upon the average of the bonuses
earned by the Employee during such smaller number of complete fiscal years
during which he was employed by the Company prior to the date of the
termination of his employment.  If the
Employee has not been employed for even one complete fiscal year prior to the
date of the termination of his employment, then his annual bonus for purposes
of computing this payment shall be calculated by prorating the bonus earned by
the Employee 

 

7

 

for the portion of the
Company’s most recently completed fiscal year during which the Employee was
employed, as though the Employee had been employed for such full fiscal
year.  Such proration shall be calculated
based upon a 365-day fiscal year.

 

(d)           If during the six month
period prior to a Change of Control, the Employee’s employment with the Company
is terminated and if it is reasonably demonstrated by the Employee that such
termination of employment (i) was at the request of a third party who has
taken steps reasonably calculated to effect a Change of Control or
(ii) otherwise arose in connection with or anticipation of a Change of
Control, then for all purposes of this Agreement the Employee shall, effective
as of the date of termination, (and subject to paragraph 7(e) below) be
entitled to participate in group life, hospitalization and medical insurance
described in paragraph 3(c) hereof, for a period of three years following the
date of termination (provided that if the Employee would be eligible to participate
in the Company’s retiree health plan (based on years of service without regard
to age) if he had retired as of the termination date, he shall be entitled to
participate in such retiree health plan upon such termination), and, no later
than thirty (30) calendar days following such Change of Control, the Company
shall pay to the Employee or his personal representative a severance payment in
an amount equal to the sum of the following:

 

(i)            The Employee’s annual base
salary through the date of the termination of employment to the extent not
theretofore paid; plus

 

(ii)           All deferred salary
(including “bank” balances in the Company’s incentive compensation plans),
profit sharing, bonuses and other compensation earned by the Employee (whether
vested or unvested or subject to any other contingencies) during the course of
his employment with the Company prior to the termination of his employment;
plus

 

(iii)          An amount equal to the
Employee’s annual base salary times the lesser of (i) three, or (ii) the number
of years (including partial years) from the Employee’s termination date until
the Employee reaches the age of 65.  For
this purpose, the Employee’s annual base salary shall be his annual base salary
as in effect immediately prior to the termination of employment; plus

 

(iv)          An amount equal to the
Employee’s annual incentive bonus compensation times the lesser of (i) three,
or (ii) the number of years (including partial years) from the Employee’s
termination date until the Employee reaches the age of 65.  The amount of the annual incentive bonus to
be applied in calculating the incentive compensation payment shall be the 

 

8

 

average of the annual cash
incentive bonuses earned by the Employee (whether such incentive bonuses were
paid in the year earned or deferred for payment in subsequent years) under all
short and long-term cash incentive bonus plans maintained by the Company in
which the Employee participated during the Company’s latest three consecutive
fiscal years ended prior to the termination of the Employee’s employment.  If the Employee has been employed by the
Company for less than three complete fiscal years prior to the date of the
termination of his employment, then the amount of the annual bonus for purposes
of computing these payments shall be based upon the average of the bonuses
earned by the Employee during such smaller number of complete fiscal years
during which he was employed by the Company prior to the date of the
termination of his employment.  If the
Employee has not been employed for even one complete fiscal year prior to the
date of the termination of his employment, then his annual bonus for purposes
of computing this payment shall be calculated by prorating the bonus earned by
the Employee for the portion of the Company’s most recently completed fiscal
year during which the Employee was employed, as though the Employee had been
employed for such full fiscal year.  Such
proration shall be calculated based upon a 365-day fiscal year.

 

(e)           If it shall be impossible or
impracticable for the Employee to participate directly in certain programs or
plans specified in subparagraph (c) or (d) above, then the Company shall
provide, at the Company’s expense, for the provision to the Employee of benefits
as nearly as possible identical to, and in no event less beneficial to the
Employee than, those which would be provided to the Employee through direct
participation or providing a cash payment(s) economically equivalent in value
to such benefits.

 

(f)            If it is determined that any
payment or distribution by the Company to or for the benefit of the Employee
(whether paid or payable or distributed or distributable pursuant to the terms
of this Agreement or otherwise, but determined without regard to any additional
payments required under this paragraph 7) (a “Payment”) would be subject to the
excise tax imposed by Section 4999 of the Code, or if any interest or penalties
are incurred by the Employee with respect to such excise tax (such excise tax,
together with any such interest and penalties, are referred to collectively as
the “Excise Tax”), then the Employee shall be entitled to receive an additional
payment (a “Gross-Up Payment”) as necessary so that, on an after-tax basis, the
amount he retains is the same as though no Excise Tax applied.  In particular, the amount of the Gross-Up
Payment shall be calculated so that, after payment by the Employee of all
Excise Taxes on the initial Payment(s) and all income taxes (and any interest
and penalties imposed with respect thereto) and Excise Taxes imposed on the

 

9

 

Gross-Up Payment, the Employee retains (in addition
to the net after-tax amount of the initial Payment) an amount of the Gross-Up
Payment equal to the Excise Taxes imposed upon the initial Payment(s).  Notwithstanding the foregoing provisions of
this paragraph 7(f), if it shall be determined that the Employee is entitled to
the Gross-Up Payment, but that the value of all Payments (as determined under
Code Section 280G) does not exceed one hundred ten percent (110%) of the
Safe Harbor Amount, then no Gross-Up Payment shall be made to the Employee and
the amounts payable under this Agreement shall be reduced so that the value of
all Payments (as determined under Code Section 280G), in the aggregate,
equals the Safe Harbor Amount.  For the
purposes of this Agreement, the term “Safe Harbor Amount” shall mean three
times the Employee’s “base amount” within the meaning of
Section 280G(b)(3) of the Code and the regulations promulgated
thereunder.  The reduction of the amounts
payable hereunder, if applicable, shall be made by first reducing the payments
under paragraph 7(c)(iii), unless an alternative method of reduction is elected
by the Employee, and in any event shall be made in such a manner as to maximize
the value of all Payments actually made to the Employee.  For purposes of reducing the Payments to the
Safe Harbor Amount, only amounts payable under this Agreement (and no other
Payments) shall be reduced.

 

(g)           Subject to the provisions of
paragraph 7(h), all determinations required to be made under this paragraph 7,
including whether and when a Gross-Up Payment is required and the amount of
such Gross-Up Payment and the assumptions to be utilized in arriving at such
determination, shall be made by such certified public accounting firm as may be
designated by the Employee (the “Accounting Firm”) which shall provide detailed
supporting calculations both to the Company and the Employee within 15 business
days of the receipt of notice from the Employee that there has been a Payment,
or such earlier time as is requested by the Company.  All fees and expenses of the Accounting Firm
shall be borne solely by the Company. 
Any Gross-Up Payment, as determined pursuant to this paragraph 7, shall be
paid by the Company to the Employee within five days of the receipt of the Accounting
Firm’s determination.  If the Accounting
Firm determines that no Excise Tax is payable by the Employee, it shall furnish
the Employee with a written opinion that failure to report the Excise Tax on
the Employee’s applicable federal income tax return would not result in the
imposition of a negligence or similar penalty. 
Any determination by the Accounting Firm shall be binding upon the
Company and the Employee.  As a result of
the uncertainty in the application of Section 4999 of the Code at the time of
the initial determination by the Accounting Firm hereunder, it is possible that
Gross-Up Payments which will not have been made by the Company should have been
made (“Underpayment”), consistent with the calculations required to be made
hereunder.  In the event that the Company
exhausts its remedies pursuant to paragraph 7(h) and the Employee thereafter is
required to make a payment of any Excise Tax, the Accounting Firm shall
determine the amount of the Underpayment that has occurred and any such Underpayment
shall be promptly paid by the Company to or for the benefit of the Employee.

 

(h)           The Employee shall notify
the Company in writing of any claim by the Internal Revenue Service that, if
successful, would require the payment by the Company of the Gross-Up
Payment.  Such notification shall be
given as soon as 

 

10

 

practicable but no later than ten business days
after the Employee is informed in writing of such claim and shall apprise the
Company of the nature of such claim and the date on which such claim is
requested to be paid.  The Employee shall
not pay such claim prior to the expiration of the 30-day period following the
date on which it gives such notice to the Company (or such shorter period
ending on the date that any payment of taxes with respect to such claim is
due).  If the Company notifies the
Employee in writing prior to the expiration of such period that it desires to
contest such claim, the Employee shall:

 

(i)            Give the Company any information
reasonably requested by the Company relating to such claim;

 

(ii)           Take such action in
connection with contesting such claim as the Company shall reasonably request
in writing from time to time, including, without limitation, accepting legal
representation with respect to such claim by an attorney reasonably selected by
the Company;

 

(iii)          Cooperate with the Company
in good faith in order effectively to contest such claim; and

 

(iv)          Permit the Company to
participate in any proceedings relating to such claim; provided, however, that
the Company shall bear and pay directly all costs and expenses (including
additional interest and penalties) incurred in connection with such contest and
shall indemnify and hold the Employee harmless, on an after-tax basis, for any
Excise Tax or income tax (including interest and penalties with respect
thereto) imposed as a result of such representation and payment of costs and
expenses.  Without limitation on the
foregoing provisions of this paragraph 7(h), the Company shall control all
proceedings taken in connection with such contest and, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its sole
option, either direct the Employee to pay the tax claimed and sue for a refund
or contest the claim in any permissible manner, and the Employee agrees to
prosecute such contest to a determination before any administrative tribunal,
in a court of initial jurisdiction and in one or more appellate courts, as the
Company shall determine; provided, however, that if the Company directs the
Employee to pay such claim and sue for a refund, the Company shall advance the
amount of such payment to the Employee, on an interest-free basis, and shall
indemnify and hold the Employee harmless, on an after-tax basis, from any
Excise Tax or income tax (including interest or penalties with 

 

11

 

respect thereto) imposed
with respect to such advance or with respect to any imputed income with respect
to such advance; and further provided that any extension of the statute of
limitations relating to payment of taxes for the taxable year of the Employee
with respect to which such contested amount is claimed to be due is limited
solely to such contested amount. 
Furthermore, the Company’s control of the contest shall be limited to
issues with respect to which a Gross-Up Payment would be payable hereunder and
the Employee shall be entitled to settle or contest, as the case may be, any
other issue raised by the Internal Revenue Service or any other taxing
authority.

 

(v)           If, after the receipt by the
Employee of an amount advanced by the Company pursuant to paragraph 7(h), the
Employee becomes entitled to receive any refund with respect to such claim, the
Employee shall (subject to the Company’s complying with the requirements of
paragraph 7(h)) promptly pay to the Company the amount of such refund (together
with any interest paid or credited thereon after taxes applicable thereto).

 

(i)            If, after the receipt by the
Employee of an amount advanced by the Company pursuant to paragraph 7(h), a
determination is made that the Employee shall not be entitled to any refund
with respect to such claim and the Company does not notify the Employee in
writing of its intent to contest such denial of refund prior to the expiration
of 30 days after such determination, then such advance shall be forgiven and
shall not be required to be repaid and the amount of such advance shall offset,
to the extent thereof, the amount of Gross-Up Payment required to be paid.

 

(j)            In the event that any
Payment to Employee pursuant to this Agreement or otherwise would be subject to
the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as
amended (or any comparable successor provision), the Company shall be entitled
to withhold any such excise tax as required by applicable law, together with
any other amounts required to be withheld under any applicable federal or state
law.

 

8.             Termination for Cause.  Employee agrees that this Agreement may be
terminated by the Company at any time for cause, which shall mean only
conviction based upon the commission of a felony or becoming the subject of a
final nonappealable judgment of a court of competent jurisdiction holding that
the Employee is liable to the Company for damages for obtaining a personal
benefit in a transaction adverse to the interests of the Company.  The Employee shall not be deemed to have been
terminated for cause unless and until there shall have been delivered to the
Employee a copy of a resolution duly adopted by the affirmative vote of not
less than three-quarters (3/4) of the entire membership of the Board called and
held for such purpose (after reasonable notice to the Employee and an
opportunity for the Employee, 

 

12

 

together with his counsel, to be heard before the
Board), finding that the Employee was guilty of conduct constituting cause for termination
as set forth in this paragraph 8 and specifying the particulars thereof in
detail.  In the event this agreement is
terminated for cause, the Employee shall forfeit his right to any and all
benefits he would otherwise have been entitled thereafter to receive under the
Agreement, but shall not forfeit his right to benefits accrued up to and
including the date of termination.

 

9.             Death of Employee.  Upon the death of the Employee during the
Employment Period, the payment of base compensation as provided in subparagraph
3(a) shall continue through the last day of the month in which death occurs,
and bonuses for the year in which death occurs shall be prorated on the basis
of the number of months elapsed during the fiscal year as of such day.  The other rights and benefits of the Employee
(or his personal representative) shall be as determined under the applicable
programs and plans of the Company covering the Employee at death.

 

10.           Stock Options and Restricted
Shares.  Upon the occurrence of a
Change of Control of the Company, all stock options shall be fully vested and
exercisable and all restrictions upon unconditional receipt by Employee of
shares of stock or other securities of the Company granted under any restricted
stock or other compensation plan shall immediately be removed, and such shares
shall vest in and be distributed immediately to Employee.  The Company covenants and agrees to take such
steps (including amendment of any existing plan) to insure that all such plans
shall allow or provide for such vesting and distribution.

 

11.           Noncompetition.

 

(a)           Scope of Noncompetition. In the event
that the employment of the Employee is terminated pursuant to paragraph 7 prior
to the expiration of the Employment Period such that the Employee receives the
payments and benefits referred to in paragraph 7(c) or 7(d), the Employee
agrees that he will not, for the Noncompetition Period (as hereinafter
defined):

 

(i)            Render services, directly or
indirectly, to any “Competitor” (other than the acquisition of an equity
interest in a corporation or other entity registered under the Securities
Exchange Act of 1934, as amended, not requiring the filing of a Schedule 13D or
Schedule 13G or any successor schedules or forms) in connection with the
development, manufacture, distribution, sale, merchandising or promotion of any
“Competitive Product” or “Competitive Service.” 
“Competitor” means any corporation, person, firm or organization or
division or part thereof engaged in or about to become engaged in research and development
work on or the production and/or sale of any Competitive Product or Competitive
Service in any country in which the Company or any of its affiliates sold a
product or service to a customer within the two-year period ending on the
effective date of the 

 

13

 

termination of Employee’s
employment with the Company.  “Competitive
Product” or “Competitive Service” means a product or service, as the case may
be, made, offered, sold or provided by a Competitor, which is the same as,
functionally equivalent to, or otherwise directly competitive with one made,
offered, sold or provided by the business units of the Company over which the
Employee had a material supervisory or management role.

 

(ii)           Engage either directly or
indirectly, in any country in which the Company or any of its affiliates sold a
product or service to a customer within the two-year period ending on the
effective date of the termination of Employee’s employment with the Company for
himself or as an investor in the development, manufacture, purchase or sale of
any Competitive Product or Competitive Service.

 

(b)           Noncompetition Period.  For purposes of this paragraph 11, the term “Noncompetition
Period” means the period beginning on the effective date of the termination of
Employee’s employment with the Company and continuing for (i) the lesser of two
years or the unexpired term of the Employment Period in the case of a severance
payment made pursuant to paragraph 7(c), or (ii) two years in the case of a
severance payment made pursuant to paragraph 7(d).

 

(c)           Survival.  The noncompetition covenant in this paragraph
11 shall survive the termination of the Employee’s employment.

 

(d)           Notification to the Company.  If the Employee notifies the Company of the
occupation the Employee proposes to take up after termination of employment
with the Company and furnishes the Company such written or oral information as
it may reasonably request concerning such proposed occupation, the Company
agrees to notify the Employee promptly, and in any event, within fourteen (14)
business days after receipt of the requested information, whether or not the
Company considers such occupation, based on the information so furnished or
derived from its independent investigation, to come within the provisions of
this Section and, if the Company considers such occupation to come within the
provisions of this Section, whether the Company will waive any of the
provisions thereof.

 

(e)           Remedies.  In addition to other remedies provided by law
or equity, upon a breach by the Employee of any of the covenants contained in
this paragraph 11, the Company shall be entitled to have a court of competent
jurisdiction enter an injunction against the Employee prohibiting any further
breach of the covenants contained herein. 
The parties further agree that the services to be performed hereunder
are of a unique, special, and extraordinary character.  Therefore, in the event of any controversy
concerning the rights or obligations under this Agreement, such rights or
obligations shall be enforceable in a court of competent jurisdiction at law or
equity by a decree of specific performance or, if the Company elects, by
obtaining 

 

14

 

damages or such other relief as the Company may
elect to pursue.  Such remedies, however,
shall be cumulative and nonexclusive and shall be in addition to any other
remedies which the Company may have.

 

12.           Enforceability.  The parties agree that nothing in this
Agreement shall in any way abrogate the right of the Company and the Employee
to enforce by injunction or otherwise the due and proper performance and
observance of the several covenants herein contained to be performed by the
Employee or the Company or to recover damages for breach thereof.

 

13.           Successors and Assigns.  If the Company sells, assigns or transfers
all or substantially all of its business, assets or earning power to any
person, or if the Company merges into or consolidates or otherwise combines
with any person which is the continuing or successor entity, then the Company
shall assign all of its right, title and interest in this Agreement as of the
date of such event to the person which is either the acquiring or successor
corporation, and such person(s) shall assume and perform from and after the
date of such assignment all of the terms, conditions and provisions imposed by
this Agreement upon the Company.  In case
of such assignment by the Company and of assumption and agreement by such
person(s), all further rights as well as all other obligations of the Company
under this Agreement thenceforth shall cease and terminate.  All rights of Employee hereunder shall inure
to the benefit of the Employee and his heirs and personal representatives.  Other than as specifically provided in this
paragraph 13, neither the Company nor Employee may assign any rights or
obligations hereunder without the express written consent of the other party.

 

14.           Termination Prior to Change
of Control.  Except as
described herein in the event of a Change of Control, this Agreement is not
intended to vest in Employee any right to continued employment by Company.  Absent such a Change of Control and unless
specifically established otherwise by agreement between the Company and
Employee, Employee’s employment status with the Company is one of employment
at-will.

 

15.           Supplemental Agreement.  This Agreement supersedes any previously
existing Contingent Employment Agreement of like nature between the Company and
the Employee; however, this Agreement supplements, and is not an amendment to
or in derogation of, any other agreement between the Company and the Employee
relating to employment or the terms and conditions thereof.  No person, other than such person as may be
designated by the Board of Directors of the Company, shall have any authority
on behalf of the Company to agree to modify or change this Agreement.  Notwithstanding the foregoing, this Agreement
supersedes and replaces any contingent employment agreement entered into
between the Employee and the Company prior to the date of this Agreement which
addresses terms of employment, compensation and severance benefits that would
become available to the Employee in the event of a change of control of the
Company, as that term may be defined in such other contingent employment
agreement.  Accordingly, any such other
contingent employment agreements shall be deemed terminated and of no further
force or effect.

 

15

 

16.           Section 409A.  This Agreement and any payment, distribution
or other benefit hereunder shall comply with the requirements of Section 409A
of the Internal Revenue Code of 1986, as amended (the “Code”), or an exemption
or exclusion therefrom, as well as any related regulations or other guidance
promulgated by the U.S. Department of the Treasury or the Internal Revenue
Service (“Section 409A”), to the extent applicable, and shall in all respects
be administered in accordance with Section 409A. To the extent Employee is
a “specified employee” under Section 409A, no payment, distribution or other
benefit described in this Agreement constituting a distribution of deferred
compensation (within the meaning of Treasury Regulation Section 1.409A-1(b)) to
be paid during the six-month period following Employee’s “separation from
service” (within the meaning of Treasury Regulation Section 1.409A-1(h)) will
be made during such six-month period. Instead, any such deferred compensation
shall be paid on the first business day following the six-month anniversary of
the separation from service. In no event may Employee, directly or indirectly,
designate the calendar year of a payment. Any provision that would cause this
Agreement or a payment, distribution or other benefit hereunder to fail to
satisfy the requirements of Section 409A shall have no force or effect and, to
the extent an amendment would be effective for purposes of Section 409A, the
parties agree that this Agreement shall be amended to comply with Section 409A.
Such amendment shall be retroactive to the extent permitted by Section 409A.
For purposes of this Agreement, Employee shall not be deemed to have terminated
employment unless and until a separation from service (within the meaning of
Treasury Regulation Section 1.409A-1(h)) has occurred. Each payment under this
Agreement shall be treated as a separate payment for purposes of
Section 409A.

 

17.           Governing Law, Severability.  This Agreement is to be governed by and
construed under the internal laws of the State of Wisconsin.  If any provision of this Agreement shall be
held invalid and unenforceable for any reason, such provision shall be deemed
deleted and the remainder of the Agreement shall be valid and enforceable
without such provision.

 

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

 

 

	
   

  	
  THE MANITOWOC COMPANY, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
  EMPLOYEE:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
   

  

 

16Exhibit
10.2

 

CONTINGENT EMPLOYMENT AGREEMENT

 

THIS
AGREEMENT, made this        day of              ,
20   , by and between THE MANITOWOC COMPANY, INC., a Wisconsin
corporation (together with its subsidiaries and any upstream parent company
that in the future may control The Manitowoc Company, Inc. referred to herein
as the “Company”) and                            ,
a key employee of the Company (the “Employee”).

 

RECITALS

 

WHEREAS, sudden takeovers, acquisitions or changes of
control of domestic corporations have occurred frequently in recent years, and
current conditions may contribute to the continuation or acceleration of this
trend; and

 

WHEREAS, the possibility of a sudden takeover, acquisition
or change of control can create uncertainty of employment and may distract
and/or cause the loss of valuable Company officers, to the detriment of the
Company and its shareholders; and

 

WHEREAS, it is believed that the detriment described can be
substantially reduced by agreement on the terms hereinafter set forth.

 

AGREEMENT

 

NOW THEREFORE, in consideration of the foregoing premises
and the mutual covenants hereinafter set forth, IT IS AGREED

 

1.             Continued Employment.

 

(a)           If a “Change of Control” (as
defined below) of the Company occurs when the Employee is employed by the
Company, the Company will continue thereafter to employ the Employee, and the
Employee will remain in the employ of the Company, in accordance with the terms
and provisions of this Agreement, for a period of two (2) years following the
date of such change (the “Employment Period”).

 

(b)           As used herein, the phrase “Change
of Control” of the Company means the first to occur of the following with
respect to the Company or any upstream holding company:

 

(i)            Any “person,” as that term
is defined in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934 (the “Exchange Act”), but excluding the Company, any trustee or other
fiduciary holding securities under an employee benefit plan of the Company, or
any corporation owned, directly or indirectly, by the stockholders of the
Company in substantially the same proportions as their ownership of 

 

 

stock of the Company, is or
becomes the “beneficial owner” (as that term is defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the Company
representing 30% or more of the combined voting power of the Company’s then
outstanding securities;

 

(ii)           The Company is merged or
consolidated with any other corporation or other entity, other than: (A) a
merger or consolidation which 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) more than 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) the Company engages in a merger
or consolidation effected to implement a recapitalization of the Company (or
similar transaction) in which no “person” (as defined above) acquires more than
30% of the combined voting power of the Company’s then outstanding
securities.  Notwithstanding the
foregoing, a merger or consolidation involving the Company shall not be
considered a “Change of Control” if the Company is the surviving corporation
and shares of the Company’s Common Stock are not converted into or exchanged
for stock or securities of any other corporation, cash or any other thing of
value, unless persons who beneficially owned shares of the Company’s Common
Stock outstanding immediately prior to such transaction own beneficially less
than a majority of the outstanding voting securities of the Company immediately
following the merger or consolidation;

 

(iii)          The Company or any
subsidiary sells, assigns or otherwise transfers assets in a transaction or
series of related transactions, if the aggregate market value of the assets so
transferred exceeds 50% of the Company’s consolidated book value, determined by
the Company in accordance with generally accepted accounting principles,
measured at the time at which such transaction occurs or the first of such
series of related transactions occurs; provided, however, that such a transfer
effected pursuant to a spin-off or split-up where stockholders of the Company
retain ownership of the transferred assets proportionate to their prorata
ownership interest in the Company shall not be deemed a “Change of Control;”

 

2

 

(iv)          The Company dissolves and
liquidates substantially all of its assets;

 

(v)           At any time after the date
of this Agreement when the Continuing Directors cease to constitute a majority
of the Board of Directors of the Company. 
For this purpose, a “Continuing Director” shall mean: (A) the
individuals who, at the date of this Agreement constitute the Board; and (B)
any new directors (other than directors designated by a person who has entered
into an agreement with the Company to effect a transaction described in clause (i),
(ii) or (iii) of this paragraph 1(b) of this Agreement) whose appointment to
the Board or nomination for election by the Company’s stockholders was approved
by a vote of at least two-thirds of the then-serving Continuing Directors; or

 

(vi)          A determination by the Board
of Directors of the Company, in view of then current circumstances or impending
events, that a Change of Control of the Company has occurred, which
determination shall be made for the specific purpose of triggering the
operative provisions of this Agreement and all other similar contingent
employment agreements of the Company.

 

2.             Duties.  Unless otherwise agreed by the Company and
Employee, during the Employment Period the Employee shall be employed by the
Company in the same position/ offices as those which the Employee held on the
date of the Change of Control of the Company. 
In such employment the Employee’s duties and authority shall consist of
and include all duties and authority customarily performed and held by a person
holding an equivalent position with a corporation of similar nature and size,
as such duties and authority related to such position are reasonably defined
and delegated from time to time by the Board of Directors of the Company.  However, no change of the Employee’s location
of employment outside a 50-mile radius from his place of employment as of the
date of this Agreement (or any other location later consented to by the
Employee), or in the Employee’s title, shall be made without the prior written
consent of the Employee.  The Employee
shall have the powers necessary to perform the duties assigned and shall be
provided such supporting services, staff, secretarial and other assistance,
office space and accouterments as shall be reasonably necessary and appropriate
in light of the duties assigned (but in no event, in any case, smaller in
quantity or size or inferior in quality than that being furnished to the
Employee on the date of the Change of Control of the Company).

 

The
Employee shall devote his entire business time, energy and skills to such
employment while so employed, but the Employee shall not be required to devote
more than an average of approximately 40 hours per calendar week to such
employment.  The Employee may participate
in civic or charitable activities which do not adversely affect his ability to
carry out his responsibilities hereunder. 
The Employee shall be 

 

3

 

entitled
to a minimum of three weeks (fifteen working days) of paid vacation annually,
or such greater amount as shall be customarily allowed to the Employee during
the fiscal year of the Company prior to the fiscal year in which the Change of
Control of the Company shall occur.  The
Employee shall have the sole discretion to determine the time and intervals of
such vacation.

 

3.             Compensation.  While employed under this Agreement, the
Employee shall be compensated as follows:

 

(a)           The Employee shall receive a
salary equal to his salary as in effect as of the date of the Change of Control
of the Company, subject to adjustment as hereinafter provided.

 

(b)           The Employee shall be
reimbursed for any and all monies advanced in connection with his employment
for reasonable and necessary expenses incurred by him on behalf of the Company.

 

(c)           The Employee shall be
included to the extent eligible thereunder in any and all plans providing
benefits for the Company’s employees, including but not limited to group life
insurance, hospitalization, medical, retiree health and pension, and shall be
provided any and all other benefits and perquisites made available to other
employees of comparable status, at the expense of the Company on a comparable
basis.  The Employee shall be deemed
eligible for retiree health if he is a participant in the Company’s retiree
health plan and qualifies on the basis of years or service (regardless of his
age).

 

(d)           The Employee shall be
permitted to participate in any restricted stock plans, stock option plans or
other stock benefit plans as the Company establishes and maintains from time to
time for its officers and employees.  The
Employee’s participation level in such stock plans shall be consistent with the
participation level of other officers and employees of the Company who have
positions, duties and responsibilities comparable to the Employee.

 

(e)           The Employee shall be
included in all profit sharing, bonus, deferred compensation, split dollar life
insurance, and similar or comparable cash incentive bonus plans customarily
extended by the Company to corporate officers and key employees of the
Company.  The Employee shall be entitled
to participate in cash incentive bonuses and profit sharing under such plans
which are consistent with the bonuses and profit sharing received under such
plans by other employees and officers of the Company who have positions, duties
and responsibilities comparable to those of the Employee provided that such
plans and bonus opportunity shall be no less favorable to the Employee than the
plans and bonus opportunity that existed immediately prior to the Change of
Control.

 

4.             Annual Compensation
Adjustments.  At least
annually during the Employment Period, the Board of Directors of the Company or
an appropriate committee thereof, in accordance with past practice, will
consider and appraise the 

 

4

 

contributions of the Employee to the Company’s
operating efficiency, growth, production and profits, and the Employee’s
compensation rate shall be eligible for increase based upon Employee’s
contributions to the Company and the increases provided to other corporate
officers and key employees generally and as the scope and success of the
Company’s operations or the Employee’s duties expand.

 

5.             Disability.  If, during the Employment Period, the
Employee shall become disabled by sickness or otherwise so that he is unable to
perform the regular duties of his employment on a full-time basis, the Company
shall pay him commencing on the date of the disability and continuing for the
first six months thereafter, as sick pay, his normal salary and all benefits as
described in paragraph 3 hereof.  If the
disability continues beyond six months, then the payment of the Employee’s
normal salary shall be suspended during the period of disability.  During the term of his disability, and until
the expiration of the Employment Period, the Employee shall continue to receive
customary fringe benefits as provided in paragraphs 3(c) and 3(d)
above.  The obligation to provide the
foregoing disability benefits shall survive the termination of this Agreement
provided the disability was incurred before termination.  If the disability terminates prior to the end
of the Employment Period, the Employee may elect to return to full-time
employment under this Agreement in which case this paragraph shall apply to all
subsequent short or long term disabilities.

 

To
determine whether the Employee is disabled for the purposes of this paragraph,
either party may from time to time request a medical examination of the
Employee by a doctor appointed by the Company, or as the parties may otherwise
agree, and the written medical opinion of such doctor shall be conclusive and
binding upon the parties as to whether or not the Employee has become disabled
and the date when such disability arose. 
The cost of any such medical examination shall be borne by the Company.

 

6.             Retirement.  If, during the Employment Period, the
Employee shall deliver to the Company a statement signed by him stating that
the Employee voluntarily chooses to retire early from the Company, or if the
Employee shall reach the age of 65, or shall with the mutual agreement of the
Company agree in writing on early retirement, then this Agreement shall
terminate on the effective date of such event and the terms of the Company’s
retirement policies or such mutual agreement shall immediately become
effective.

 

7.             Termination Other Than for
Cause.

 

(a)           At any time during the
ninety (90) calendar day period commencing on the date of completion of the
transaction or series of related transactions causing the occurrence of a
Change of Control (the “Trial Period”), the Employee shall have the right to
elect to terminate his employment under this Agreement for any reason or no
reason at all and shall thereupon be entitled to the benefits and a severance
payment as set forth in paragraph 7(c) below, however the payments as described
in paragraphs 7(c)(iii) and 7(c)(iv) shall be reduced by one-half (50%) in the
event the Employee terminates his employment pursuant to this paragraph 7(a)
without Good Reason.

 

5

 

(b)           If during the Employment
Period the Employee shall elect to terminate his employment under this
Agreement for Good Reason, he shall thereupon be entitled to the benefits and a
severance payment as set forth in paragraph 7(c) below.  For purposes of this Agreement, a termination
for “Good Reason” means a termination by Employee based upon the occurrence
(without Employee’s express written consent) of any of the following:  (i) a material diminution in Employee’s
position or title, or the assignment of duties to Employee that are materially
inconsistent with Employee’s position or title as described in paragraph 2;
(ii) a material diminution in Employee’s base salary or incentive/bonus
opportunities; (iii) a change of more than fifty (50) miles from the location
of his principal place of employment on the date of the Change of Control of
the Company; or (iv) a material breach by the Company of any of its obligations
under this Agreement, or (v) any successor to the principal business of the
Company (whether by merger, purchase of assets, liquidation or otherwise) as
described in paragraph 12 fails or refuses to assume the Company’s obligations
under this Agreement.  Notwithstanding
the foregoing, no such event described above shall constitute Good Reason
unless Employee gives written notice to the Company specifying the
condition or event relied upon for such termination within ninety
(90) days of the initial existence of such event and (2) the Company
fails to cure the condition or event constituting Good Reason within thirty
(30) days following receipt of Employee’s notice.

 

(c)           If during the Employment
Period the Employee’s employment hereunder shall be terminated (1) by the
Company for any reason other than the reasons set forth paragraphs 5, 6, 8 or 9
of this Agreement, or (2) by the Employee pursuant to paragraph 7(a) or 7(b)
above, thereafter the Employee shall be entitled to participate in group life,
hospitalization and medical insurance described in paragraph 3(c) hereof, for
the lesser of (i) the remainder of the Employment Period (provided that if the
Employee would be eligible to participate in the Company’s retiree health plan
(based on years of service without regard to age) if he had retired as of the
termination date, he shall be entitled to participate in such retiree health
plan upon such termination), or (ii) the number of years (including partial
years) until the Employee reaches the age of 65, and, no later than thirty (30)
calendar days following such termination, the Company shall pay to the Employee
or his personal representative a severance payment in an amount equal to the
sum of the following:

 

(i)            The Employee’s annual base
salary through the date of the termination of employment to the extent not
theretofore paid; plus

 

(ii)           All deferred salary
(including “bank” balances in the Company’s incentive compensation plans),
profit sharing, bonuses and other compensation earned by the Employee (whether
vested or unvested or subject to any other contingencies) during the course of
his employment with the Company prior to the termination of his employment;
plus

 

6

 

(iii)          The Employee’s base salary
for the lesser of (i) the portion of the Employment Period remaining unexpired
as of the termination date, or (ii) the number of years (including partial
years) from the Employee’s termination date until the Employee reaches the age
of 65  (subject to the 50% reduction if
the termination is pursuant to paragraph 7(a)). 
For this purpose, the Employee’s base salary shall be his base salary as
in effect immediately prior to the termination of employment.  For any fraction of a year included in the
unexpired portion of the Employment Period, the Employee’s base salary shall be
prorated based upon a 365-day year; plus

 

(iv)          Incentive bonus compensation
for the current fiscal year of the Company during which the termination of
employment occurs and for the lesser of (i) all subsequent fiscal years of the
Company thereafter which are included in whole or in part in the portion of the
Employment Period remaining unexpired as of the termination date, or (ii) the
number of years (including partial years) from the Employee’s termination date
until the Employee reaches the age of 65 (subject to the 50% reduction if the
termination is pursuant to paragraph 7(a)). 
The amount of the cash incentive bonus for any partial fiscal year
included in the balance of the Employment Period shall be prorated based on a
365-day fiscal year.  The amount of the
annual bonus to be applied in calculating the incentive compensation payment
shall be the average of the annual cash incentive bonuses earned by the
Employee (whether such incentive bonuses were paid in the year earned or
deferred for payment in subsequent years) under all short and long-term cash
incentive bonus plans maintained by the Company in which the Employee
participated during the Company’s latest three consecutive fiscal years ended
prior to the termination of the Employee’s employment.  If the Employee has been employed by the
Company for less than three complete fiscal years prior to the date of the
termination of his employment, then the amount of the annual bonus for purposes
of computing these payments shall be based upon the average of the bonuses
earned by the Employee during such smaller number of complete fiscal years
during which he was employed by the Company prior to the date of the
termination of his employment.  If the
Employee has not been employed for even one complete fiscal year prior to the
date of the termination of his employment, then his annual bonus for purposes
of computing this payment shall be calculated by prorating the bonus earned by
the Employee 

 

7

 

for the portion of the
Company’s most recently completed fiscal year during which the Employee was
employed, as though the Employee had been employed for such full fiscal
year.  Such proration shall be calculated
based upon a 365-day fiscal year.

 

(d)           If during the six month
period prior to a Change of Control, the Employee’s employment with the Company
is terminated and if it is reasonably demonstrated by the Employee that such
termination of employment (i) was at the request of a third party who has
taken steps reasonably calculated to effect a Change of Control or
(ii) otherwise arose in connection with or anticipation of a Change of
Control, then for all purposes of this Agreement the Employee shall, effective
as of the date of termination, (and subject to paragraph 7(e) below) be
entitled to participate in group life, hospitalization and medical insurance
described in paragraph 3(c) hereof, for a period of two years following the
date of termination (provided that if the Employee would be eligible to participate
in the Company’s retiree health plan (based on years of service without regard
to age) if he had retired as of the termination date, he shall be entitled to
participate in such retiree health plan upon such termination), and, no later
than thirty (30) calendar days following such Change of Control, the Company
shall pay to the Employee or his personal representative a severance payment in
an amount equal to the sum of the following:

 

(i)            The Employee’s annual base
salary through the date of the termination of employment to the extent not
theretofore paid; plus

 

(ii)           All deferred salary
(including “bank” balances in the Company’s incentive compensation plans),
profit sharing, bonuses and other compensation earned by the Employee (whether
vested or unvested or subject to any other contingencies) during the course of
his employment with the Company prior to the termination of his employment;
plus

 

(iii)          An amount equal to the
Employee’s annual base salary times the lesser of (i) two, or (ii) the number of
years (including partial years) from the Employee’s termination date until the
Employee reaches the age of 65.  For this
purpose, the Employee’s annual base salary shall be his annual base salary as
in effect immediately prior to the termination of employment; plus

 

(iv)          An amount equal to the
Employee’s annual incentive bonus compensation times the lesser of (i) two, or
(ii) the number of years (including partial years) from the Employee’s
termination date until the Employee reaches the age of 65.  The amount of the annual incentive bonus to
be applied in calculating the incentive compensation payment shall be the 

 

8

 

average of the annual cash
incentive bonuses earned by the Employee (whether such incentive bonuses were
paid in the year earned or deferred for payment in subsequent years) under all
short and long-term cash incentive bonus plans maintained by the Company in
which the Employee participated during the Company’s latest three consecutive
fiscal years ended prior to the termination of the Employee’s employment.  If the Employee has been employed by the
Company for less than three complete fiscal years prior to the date of the
termination of his employment, then the amount of the annual bonus for purposes
of computing these payments shall be based upon the average of the bonuses
earned by the Employee during such smaller number of complete fiscal years
during which he was employed by the Company prior to the date of the
termination of his employment.  If the
Employee has not been employed for even one complete fiscal year prior to the
date of the termination of his employment, then his annual bonus for purposes
of computing this payment shall be calculated by prorating the bonus earned by
the Employee for the portion of the Company’s most recently completed fiscal
year during which the Employee was employed, as though the Employee had been
employed for such full fiscal year.  Such
proration shall be calculated based upon a 365-day fiscal year.

 

(e)           If it shall be impossible or
impracticable for the Employee to participate directly in certain programs or
plans specified in subparagraph (c) or (d) above, then the Company shall
provide, at the Company’s expense, for the provision to the Employee of benefits
as nearly as possible identical to, and in no event less beneficial to the
Employee than, those which would be provided to the Employee through direct
participation or providing a cash payment(s) economically equivalent in value
to such benefits.

 

(f)            If it is determined that any
payment or distribution by the Company to or for the benefit of the Employee
(whether paid or payable or distributed or distributable pursuant to the terms
of this Agreement or otherwise) (a “Payment”) would constitute an excess “parachute
payment” within the meaning of Section 280G of the Code and would result
in the imposition on the Employee of an excise tax under Section 4999 of
the Code (the “Excise Tax”), then the Employee shall be entitled to receive the
Payments unless the after-tax amount that would be retained by the Employee
(after taking into account any and all applicable federal, state and local
excise, income or other taxes payable by the Employee, including the Excise
Tax) is less than the after-tax amount that would be retained by the Employee
(after taking into account any and all applicable federal, state and local
excise, income or other taxes payable by the Employee, including the Excise
Tax) if the Employee were instead to be paid or provided, as the case may be,
the maximum amount of the Payments that the 

 

9

 

Employee could receive without being subject to the
Excise Tax (the “Reduced Payments”), in which case the Employee shall be
entitled only to the Reduced Payments. 
The reduction of the amounts payable hereunder, if applicable, shall be
made by first reducing the payments under paragraph 7(c)(iii), unless an
alternative method of reduction is elected by the Employee, and in any event
shall be made in such a manner as to maximize the value of all Payments
actually made to the Employee.  For
purposes of reducing the Payments, only amounts payable under this Agreement
(and no other Payments) shall be reduced.

 

(g)           All determinations required
to be made under this paragraph 7, and the assumptions to be utilized in
arriving at such determination, shall be made by such certified public
accounting firm as may be designated by the Employee (the “Accounting Firm”)
which shall provide detailed supporting calculations both to the Company and
the Employee.  All fees and expenses of
the Accounting Firm shall be borne solely by the Company.  Any determination by the Accounting Firm
shall be binding upon the Company and the Employee.

 

(h)           In the event that any
Payment to Employee pursuant to this Agreement or otherwise would be subject to
the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as
amended (or any comparable successor provision), the Company shall be entitled
to withhold any such excise tax as required by applicable law, together with
any other amounts required to be withheld under any applicable federal or state
law.

 

8.             Termination for Cause.  Employee agrees that this Agreement may be
terminated by the Company at any time for cause, which shall mean only
conviction based upon the commission of a felony or becoming the subject of a
final nonappealable judgment of a court of competent jurisdiction holding that
the Employee is liable to the Company for damages for obtaining a personal
benefit in a transaction adverse to the interests of the Company.  The Employee shall not be deemed to have been
terminated for cause unless and until there shall have been delivered to the
Employee a copy of a resolution duly adopted by the affirmative vote of not
less than three-quarters (3/4) of the entire membership of the Board called and
held for such purpose (after reasonable notice to the Employee and an
opportunity for the Employee, together with his counsel, to be heard before the
Board), finding that the Employee was guilty of conduct constituting cause for
termination as set forth in this paragraph 8 and specifying the
particulars thereof in detail.  In the
event this agreement is terminated for cause, the Employee shall forfeit his
right to any and all benefits he would otherwise have been entitled thereafter
to receive under the Agreement, but shall not forfeit his right to benefits
accrued up to and including the date of termination.

 

9.             Death of Employee.  Upon the death of the Employee during the Employment
Period, the payment of base compensation as provided in subparagraph 3(a) shall
continue through the last day of the month in which death occurs, and bonuses
for the year in which death occurs shall be prorated on the basis of the number
of months elapsed during the fiscal year as of such day.  The other rights and 

 

10

 

benefits of the Employee (or his personal
representative) shall be as determined under the applicable programs and plans
of the Company covering the Employee at death.

 

10.           Stock Options and Restricted
Shares.  Upon the occurrence of a
Change of Control of the Company, all stock options shall be fully vested and
exercisable and all restrictions upon unconditional receipt by Employee of shares
of stock or other securities of the Company granted under any restricted stock
or other compensation plan shall immediately be removed, and such shares shall
vest in and be distributed immediately to Employee.  The Company covenants and agrees to take such
steps (including amendment of any existing plan) to insure that all such plans
shall allow or provide for such vesting and distribution.

 

11.           Noncompetition.

 

(a)           Scope of Noncompetition. In the event
that the employment of the Employee is terminated pursuant to paragraph 7 prior
to the expiration of the Employment Period such that the Employee receives the
payments and benefits referred to in paragraph 7(c) or 7(d), the Employee
agrees that he will not, for the Noncompetition Period (as hereinafter
defined):

 

(i)            Render services, directly or
indirectly, to any “Competitor” (other than the acquisition of an equity
interest in a corporation or other entity registered under the Securities
Exchange Act of 1934, as amended, not requiring the filing of a Schedule 13D or
Schedule 13G or any successor schedules or forms) in connection with the
development, manufacture, distribution, sale, merchandising or promotion of any
“Competitive Product” or “Competitive Service.” 
“Competitor” means any corporation, person, firm or organization or
division or part thereof engaged in or about to become engaged in research and
development work on or the production and/or sale of any Competitive Product or
Competitive Service in any country in which the Company or any of its
affiliates sold a product or service to a customer within the two-year period
ending on the effective date of the termination of Employee’s employment with
the Company.  “Competitive Product” or “Competitive
Service” means a product or service, as the case may be, made, offered, sold or
provided by a Competitor, which is the same as, functionally equivalent to, or
otherwise directly competitive with one made, offered, sold or provided by the
business units of the Company over which the Employee had a material
supervisory or management role.

 

(ii)           Engage either directly or
indirectly, in any country in which the Company or any of its affiliates sold a
product or service to a customer within the two-year period ending on the 

 

11

 

effective date of the
termination of Employee’s employment with the Company for himself or as an
investor in the development, manufacture, purchase or sale of any Competitive
Product or Competitive Service.

 

(b)           Noncompetition Period.  For purposes of this paragraph 11, the term “Noncompetition
Period” means the period beginning on the effective date of the termination of
Employee’s employment with the Company and continuing for (i) the lesser of two
years or the unexpired term of the Employment Period in the case of a severance
payment made pursuant to paragraph 7(c), or (ii) two years in the case of a
severance payment made pursuant to paragraph 7(d).

 

(c)           Survival.  The noncompetition covenant in this paragraph
11 shall survive the termination of the Employee’s employment.

 

(d)           Notification to the Company.  If the Employee notifies the Company of the
occupation the Employee proposes to take up after termination of employment
with the Company and furnishes the Company such written or oral information as
it may reasonably request concerning such proposed occupation, the Company
agrees to notify the Employee promptly, and in any event, within fourteen (14)
business days after receipt of the requested information, whether or not the
Company considers such occupation, based on the information so furnished or
derived from its independent investigation, to come within the provisions of
this Section and, if the Company considers such occupation to come within the
provisions of this Section, whether the Company will waive any of the
provisions thereof.

 

(e)           Remedies.  In addition to other remedies provided by law
or equity, upon a breach by the Employee of any of the covenants contained in
this paragraph 11, the Company shall be entitled to have a court of competent
jurisdiction enter an injunction against the Employee prohibiting any further
breach of the covenants contained herein. 
The parties further agree that the services to be performed hereunder
are of a unique, special, and extraordinary character.  Therefore, in the event of any controversy
concerning the rights or obligations under this Agreement, such rights or
obligations shall be enforceable in a court of competent jurisdiction at law or
equity by a decree of specific performance or, if the Company elects, by
obtaining damages or such other relief as the Company may elect to pursue.  Such remedies, however, shall be cumulative
and nonexclusive and shall be in addition to any other remedies which the
Company may have.

 

12.           Enforceability.  The parties agree that nothing in this
Agreement shall in any way abrogate the right of the Company and the Employee
to enforce by injunction or otherwise the due and proper performance and
observance of the several covenants herein contained to be performed by the
Employee or the Company or to recover damages for breach thereof

 

13.           Successors and Assigns.  If the Company sells, assigns or transfers
all or substantially all of its business, assets or earning power to any
person, or if the 

 

12

 

Company merges into or consolidates or otherwise
combines with any person which is the continuing or successor entity, then the
Company shall assign all of its right, title and interest in this Agreement as
of the date of such event to the person which is either the acquiring or
successor corporation, and such person(s) shall assume and perform from and
after the date of such assignment all of the terms, conditions and provisions
imposed by this Agreement upon the Company. 
In case of such assignment by the Company and of assumption and
agreement by such person(s), all further rights as well as all other
obligations of the Company under this Agreement thenceforth shall cease and
terminate.  All rights of Employee hereunder
shall inure to the benefit of the Employee and his heirs and personal
representatives.  Other than as
specifically provided in this paragraph 13, neither the Company nor Employee
may assign any rights or obligations hereunder without the express written
consent of the other party.

 

14.           Termination Prior to Change
of Control.  Except as
described herein in the event of a Change of Control, this Agreement is not
intended to vest in Employee any right to continued employment by Company.  Absent such a Change of Control and unless
specifically established otherwise by agreement between the Company and
Employee, Employee’s employment status with the Company is one of employment
at-will.

 

15.           Supplemental Agreement.  This Agreement supersedes any previously existing
Contingent Employment Agreement of like nature between the Company and the
Employee; however, this Agreement supplements, and is not an amendment to or in
derogation of, any other agreement between the Company and the Employee
relating to employment or the terms and conditions thereof.  No person, other than such person as may be
designated by the Board of Directors of the Company, shall have any authority
on behalf of the Company to agree to modify or change this Agreement.  Notwithstanding the foregoing, this Agreement
supersedes and replaces any contingent employment agreement entered into
between the Employee and the Company prior to the date of this Agreement which
addresses terms of employment, compensation and severance benefits that would become
available to the Employee in the event of a change of control of the Company,
as that term may be defined in such other contingent employment agreement.  Accordingly, any such other contingent
employment agreements shall be deemed terminated and of no further force or
effect.

 

16.           Section 409A.  This Agreement and any payment, distribution
or other benefit hereunder shall comply with the requirements of Section 409A
of the Internal Revenue Code of 1986, as amended (the “Code”), or an exemption
or exclusion therefrom, as well as any related regulations or other guidance
promulgated by the U.S. Department of the Treasury or the Internal Revenue
Service (“Section 409A”), to the extent applicable, and shall in all respects
be administered in accordance with Section 409A. To the extent Employee is
a “specified employee” under Section 409A, no payment, distribution or other
benefit described in this Agreement constituting a distribution of deferred
compensation (within the meaning of Treasury Regulation Section 1.409A-1(b))
to be paid during the six-month period following Employee’s “separation from
service” (within the meaning of Treasury Regulation Section 1.409A-1(h))
will be made during such six-month period. Instead, any such deferred 

 

13

 

compensation shall be paid on the first business day
following the six-month anniversary of the separation from service. In no event
may Employee, directly or indirectly, designate the calendar year of a payment.
Any provision that would cause this Agreement or a payment, distribution or
other benefit hereunder to fail to satisfy the requirements of Section 409A
shall have no force or effect and, to the extent an amendment would be
effective for purposes of Section 409A, the parties agree that this Agreement
shall be amended to comply with Section 409A. Such amendment shall be
retroactive to the extent permitted by Section 409A. For purposes of this
Agreement, Employee shall not be deemed to have terminated employment unless and
until a separation from service (within the meaning of Treasury Regulation
Section 1.409A-1(h)) has occurred. Each payment under this Agreement shall be
treated as a separate payment for purposes of Section 409A.

 

17.           Governing Law, Severability.  This Agreement is to be governed by and
construed under the internal laws of the State of Wisconsin.  If any provision of this Agreement shall be
held invalid and unenforceable for any reason, such provision shall be deemed
deleted and the remainder of the Agreement shall be valid and enforceable
without such provision.

 

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

 

 

	
   

  	
  THE MANITOWOC COMPANY, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EMPLOYEE:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
   

  

 

14

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