CTO Employment Agreement

EXHIBIT 10.9
Conformed Copy


EXECUTIVE EMPLOYMENT AGREEMENT
(as amended June 14, 2002)


THIS AGREEMENT entered into as of the 1st day of September 2001, by and between Exide Technologies (the "Company"), and Craig H. Muhlhauser (the "Executive").


WHEREAS, the Company wishes to employ the Executive and the Executive wishes to be employed by the Company.


NOW, THEREFORE, in consideration of the respective agreements of the parties contained herein, it is agreed as follows:


1. Employment Term. The "Employment Term" shall commence on the date first written above (the "Effective Date") and, unless previously terminated in accordance with Section 7 hereof; shall expire on the third anniversary of the Effective Date. The Employment Term shall automatically be extended for one (1) year on each anniversary of the Effective Date unless either the Company or the Executive shall have given written notice to the other at least ninety (90) days prior thereto that the Employment Term shall not be so extended.


2. Employment.


(a) Subject to the provisions of Section 7 hereof, the Company agrees to continue to employ the Executive and the Executive agrees to remain in the employ of the Company during the Employment Term. During the Employment Term, the Executive shall be employed as the Chief Executive Officer of the Company or in such other senior executive capacity as may be mutually agreed to in writing by the parties. The Executive shall perform the duties, undertake the responsibilities and exercise the authority customarily performed, undertaken and exercised by persons situated in a similar executive capacity. He shall also promote, by entertainment or otherwise, the business of the Company.


(b) During the Employment Term, excluding periods of vacation and sick leave to which the Executive is entitled, the Executive agrees to devote his full business time to the business and affairs of the Company to the extent necessary to discharge the responsibilities assigned to be Executive hereunder. The Executive may (1) serve on corporate, civil or charitable boards or committees and (2) manage personal investments so long as such activities do not significantly interfere with the performance of the Executive's responsibilities hereunder. It is expressly understood and agreed that to the extent that any such activities have been conducted by the Executive prior to the Effective Date, the continued conduct of such activities (or the conduct of activities similar in nature and scope thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with the performance of the Executive's responsibilities to the Company.


3. Compensation.


(a) Base Salary. During the Employment Term, the Company agrees to pay or cause to be paid to the Executive an annual base salary of $700,000 or as may be increased


from time to time (the "Base Salary"). Such Base Salary shall be payable in accordance with the Company's customary practices applicable to its executives.


(b) Annual Bonus. In addition to Base Salary, the Executive shall be eligible to receive, with respect to each fiscal year ending during the Employment Term, an annual bonus (the "Annual Bonus") under the terms of the Company's then applicable annual bonus plan. The Executive's Annual Bonus shall have a target amount equal to 100% of his Base Salary.


(c) Long-Term Incentives. During the Employment Term, the Executive shall be eligible to receive such long-term incentives (e.g., stock options and restricted stock) as shall be determined by the Company's Board of Directors (the "Board") in its sole discretion.


4. Employee Benefits. During the Employment Term, the Executive shall be entitled to participate in all employee benefit plans, practices and programs maintained by the Company and made available to senior executives generally, including, without limitation, all pension, retirement, supplemental retirement, profit sharing, savings, medical, hospitalization, disability, dental, life or travel accident insurance benefit plans. Unless otherwise provided herein, the compensation and benefits under, and the Executive's participation in, such plans, practices and programs shall be on the same basis and terms as are applicable to senior executives of the Company generally.


5. Vacation and Sick Leave.


(a) The Executive shall be entitled to annual vacation in accordance with the policies as periodically established by the Board for similarly situated executives of the Company.


(b) The Executive shall be entitled to sick leave (without loss of pay) in accordance with the Company's policies as in effect from time to time.


6. Termination. During the Employment Term, the Executive's employment hereunder may be terminated under the following circumstances:


(a) Cause. The Company may terminate the Executive's employment for "Cause." For purposes of this Agreement "Cause" shall mean:


(i) the failure by the Executive to substantially perform the Executive's duties with the Company (other than any such failure resulting from the Executive's incapacity due to physical or mental illness) after a written demand for substantial performance is delivered to the Executive by the Board, which demand specifically identifies the manner in which the Board believes that the Executive has not substantially performed the Executive's duties, (ii) the willful engaging by the Executive in conduct which is demonstrably and materially injurious to the Company or its Affiliates, monetarily or otherwise or (iii) a breach of any of the Executive's covenants set forth in Section 10 hereof. For purposes of clauses (i) and (ii) of this definition, no act, or failure to act, on the Executive's part shall be deemed "willful" unless done, or omitted to be done, by the Executive not in good faith and without reasonable belief that the Executive's act, or failure to act, was in the best interest of the Company.


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(b) Disability. The Company may terminate the Executive's employment after having established the Executive's Disability. For purposes of this Agreement, "Disability" means a physical or mental infirmity which impairs the Executive's ability to substantially perform his or her duties under this Agreement for six (6) consecutive months. The Executive shall be entitled to the compensation and benefits provided for under this Agreement for any period during the Employment Term and prior to the establishment of the Executive's Disability during which the Executive is unable to work due to a physical or mental infirmity. Notwithstanding anything contained in this Agreement to the contrary, until the Termination Date specified in a Notice of Termination (as each term is hereinafter defined) relating to the Executive's Disability, the Executive shall be entitled to return to his other position with the Company as set forth in this Agreement in which event no Disability of the Executive will be deemed to have occurred.


(c) Good Reason. The Executive may terminate his employment hereunder for "Good Reason." For purposes of this Agreement, "Good Reason" shall mean the occurrence of any of the following events or conditions without the Executive's prior written consent:


(i) a change in the Executive's status, title, position or responsibilities (including reporting responsibilities) which represents a materially adverse change from his other status, title, position or responsibilities as in effect immediately prior thereto;


(ii) a reduction in the Executive's Base Salary;


(iii) the failure of the Company to obtain from its Successors or Assigns the express assumption and agreement required under Section 12 hereof; or


(iv) any purported termination of the Executive's employment by the Company which is not effected pursuant to a Notice of Termination satisfying the terms set forth in the definition of Notice of Termination.


(d) Voluntary Termination. The Executive may voluntarily terminate his or her employment hereunder at any time by providing ninety (90) days' written notice of termination to the Company. In addition, the Company may voluntarily terminate the Executive's employment hereunder without Cause at any time by providing ninety (90) days' written notice of such termination to the Executive.


7. Compensation Upon Termination. Upon termination of the Executive's employment during the Employment Term, the Executive shall be entitled to the benefits set forth below.


(a) If the Executive's employment with the Company shall be terminated (1) by the Company for Cause, death or Disability or (2) by the Executive voluntarily other than for Good Reason, the Company shall pay the Executive all amounts earned or accrued through the Termination Date but not paid as of the Termination Date, including (i) Base Salary, (ii) reimbursement for reasonable and necessary expenses incurred by the Executive on behalf of the Company during the period ending on the Termination Date, (iii) vacation pay, and (iv) sick leave (collectively, "Accrued Compensation"). In addition to the foregoing, if the Executive's employment is terminated by the Company for Disability or by reason of the Executive's death,


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the Company shall pay to the Executive or his or her beneficiaries an amount equal to the "Pro Rata Bonus" (as hereinafter defined). The "Pro Rata Bonus" is an amount equal to the Executive's target bonus under the Company's annual bonus plan ("Target Bonus") multiplied by a fraction the numerator of which is the number of days in such fiscal year through the Termination Date and the denominator of which is 365. The Executive's entitlement to any other compensation or benefits shall be determined in accordance with the Company's employee benefit plans and other applicable programs and practices then in effect. All amounts provided for in this Section 7(a) shall be paid to the Executive in a lump sum within ten (10) business days of the Termination Date.


(b) If the Executive's employment with the Company shall be terminated, (1) by the Company other than for Cause, death or Disability or (2) by the Executive for Good Reason, the Executive shall be entitled, upon execution of a waiver and general release of claims in a form reasonably acceptable to the Company, to the following:


(i) the Company shall pay the Executive all Accrued Compensation and a Pro-Rata Bonus in a lump sum within ten (10) business days of the Termination Date;


(ii) for thirty-six (36) months from the Termination Date (the "Continuation Period"), the Company shall pay the Executive, Base Salary and Annual Bonus;


(iii) for the "Continuation Period", the Company shall at its expense continue on behalf of the Executive and his or he ...