Executive Severance Agreement - Maytag Corp. and Ralph F. Hake
EXECUTIVE SEVERANCE AGREEMENT
This Agreement is made this 19th day of June, 2001 (the "Effective Date"), by
and between Maytag Corporation, a Delaware corporation (the "Company"), and
Ralph F. Hake (the "Executive").
In consideration of the mutual promises and agreements contained herein, the
adequacy and sufficiency of which are hereby acknowledged, the Company and the
Executive hereby agree as follows:
(1) If the Executive is involuntarily terminated, except for Cause (as Cause is
defined herein), by the Company within five years from the Effective Date, the
Company will pay to the Executive an amount equal to the sum of: (1) two years
of base salary at the rate of pay in effect at the date of termination; and (2)
two years of target bonus under the Incentive Compensation Plan at the rate of
base pay and at the plan's target percentage in effect at the date of
termination.
For purposes of this agreement, "Cause" shall be determined by the Board of
Directors, in the exercise of good faith and reasonable judgment, and shall mean
the occurrence of any one or more of the following:
(a) A demonstrably willful and deliberate act or failure to act by the
Executive (other than as a result of incapacity due to physical or mental
illness) which is committed in bad faith, without reasonable belief that
such action or inaction is in the best interests of the Company, which
causes actual material financial injury to the Company and which act or
inaction is not remedied within fifteen (15) business days of written
notice from the Company; or
(b) The Executive's conviction for committing an act of fraud,
embezzlement, theft, or any other act constituting a felony involving moral
turpitude or causing material harm, financial or otherwise, to the Company.
(2) The Executive agrees to abide by all aspects of the Maytag Confidentiality,
Non-Compete and Intellectual Property Rights Agreement signed by the Executive.
(3) The Executive agrees to refrain from attempting to recruit or otherwise
solicit the services of any Maytag employee for a period of two years following
termination of employment with the Company.
(4) The Executive acknowledges that, upon receipt of the payment described in
paragraph 1, if such payment occurs, he is owed no further compensation or
benefits of any nature from the Company. Further, if the Executive is eligible
for any compensation or benefits under a Change of Control Agreement, no
benefits are available under this agreement.
(5) Nothing in this agreement shall be deemed to entitle the Executive to
continued employment with the Company or its subsidiaries, or limit the
discretion of the Company in any fashion to terminate the employment of the
Executive.
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(6) This Agreement constitutes the entire agreement and understanding between
the parties with respect to the subject matter hereof and supersedes and
preempts any prior understandings, agreements, or representations by or between
the parties, written or oral, which may have related in any manner to the
subject matter hereof.
(7) The provisions of this Agreement may be amended or waived only by the
written agreement of the Company and the Executive, and no course of conduct or
failure or delay in enforcing the provisions of this Agreement shall affect the
validity, binding effect, or enforceability of this Agreement.
IN WITNESS WHEREOF, the parties have executed this agreement effective the date
set out above.
/s/ Ralph F. Hake /s/ Bernard G. Rethore
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Executive Chairman, Compensation Committee
Maytag Corporation