|
1.
|
Timing of Payments
under Brunswick Performance Plan. All payments under the
Brunswick Performance Plan, and any and all successor or replacement
plans, described in Sections 4(b), 6(a)(ii), 6(b)(i), 6(b)(ii), 6(c)(ii)
and 6(c)(iii) of the Employment Agreement will be paid to you in
accordance with the terms of the Brunswick Performance
Plan.
|
|
2.
|
Discontinuance of
Certain Compensation and Benefits. All references in the
Employment Agreement to [(i)] the Strategic Incentive Plan (including,
without limitation, Section 4(c) of the Employment Agreement in its
entirety, Sections 6(a)(ii), 6(b)(i)(iii), 6(b)(ii) and 6(c)(ii) of the
Employment Agreement, the definitions of “Reduction in Compensation”,
“SIP”, “SIP Bonus” and “Target SIP Bonus” and Appendix II of the
Employment Agreement), except to the extent provided in paragraph 7 of
this letter agreement[, (ii) financial counseling services (including,
without limitation, Section 4(e) of the Employment Agreement in its
entirety and Sections 6(a)(iv) and 6(b)(iv) of the Employment Agreement)
and] [(iii) excess liability coverage (including, without limitation,
Section 4[(k)][(l)](ii) of the Employment Agreement in its entirety and
Sections 6(a)(iv) and 6(b)(iv) of the Employment Agreement)], are hereby
deleted.
|
|
3.
|
Vacation
Payout. Upon termination of your employment with
Brunswick, your earned but unused vacation described in Section
4[(f)][(g)][(h)] of the Employment Agreement will be paid to you within 30
days following termination.
|
|
4.
|
Additional Clawback
Provisions. In the event of any material breach by the
Executive of the provisions of Section 5(a) or (b) of the Employment
Agreement, the Executive shall be obligated to pay to the Company, in
cash, within five business days after written demand is made therefor by
the Company, an amount equal to any payments received by the Executive
under Sections 6(a), (b) and [(f)] of the Employment
Agreement. In addition, the period described in Section
5(e)(ii)(C) of the Employment Agreement shall commence twelve months prior
to the date of the Executive’s termination of employment for any
reason.
|
|
5.
|
Timing of Total
Severance Payment. In the event that the Total Severance
Payment described in Section 6(a)(i) of the Employment Agreement becomes
payable, it will be paid in equal installments, in accordance with the
Company’s regular payroll practices and procedures, as if it were to be
paid over a 18-month period that commences on the first payroll date
following the Release Effective Date; provided that all unpaid portions of
the Total Severance Payment will be distributed to you in a lump sum on
the payroll date immediately preceding March 15 of the calendar year
following the calendar year in which the date of termination
occurs. However, if you are to attain age 65 prior to the
second anniversary of the date on which your employment terminates, the
Total Severance Payment will be reduced to a level determined by
multiplying the amount of such payment by a fraction, the numerator of
which will be the number of full months between the date of termination
and the date you will attain age 65 (and the numerator will not be reduced
to reflect any six-month delay in payment that may be required pursuant to
Section 7 of the Employment Agreement), and the denominator of which will
be 18. In addition, the 18-month period described in the first
sentence of this paragraph 5 will also be reduced
accordingly.
|
|
6.
|
Timing of Total Change
in Control Payment. In the event that the Total Change
in Control Payment becomes payable under Section 6(b)(i) of the Employment
Agreement, it will be paid in a lump sum on the Release Effective
Date.
|
|
7.
|
Calculation of Total
Change in Control Payment. In light of the elimination
of the Strategic Incentive Plan by the compensation committee of the
Board, the reference in Section 6(b)(i)(iii) of the Employment Agreement
to the targeted bonus under the Strategic Incentive Plan for the period
that ended most recently prior to a Change in Control will refer to the
Strategic Incentive Plan [2006-2007] period for any termination of
employment under Section 6(b) of the Employment Agreement that occurs on
or before December 31, 2010; provided, however, that
with respect to any such termination that occurs after December 31, 2010,
Section 6(b)(i)(iii) of the Employment Agreement will have no effect and
the Total Change in Control Payment will be calculated without regard to
the Strategic Incentive Plan.
|
|
8.
|
Treatment of
Performance-Based Awards. In the event that the Equity
Incentive awards become fully vested and, if applicable, immediately
exercisable, under Section 6(b)(iii) of the Employment Agreement, the
treatment of all awards held by you that are subject to performance-based
vesting criteria will be governed by the terms and conditions of the
equity compensation plans and award agreements and/or award terms pursuant
to which they were granted.
|
|
9.
|
Timing of Accrued Base
Salary Payment. Any payment of any unpaid Base Salary
accrued through a date of termination described in Section 6(c)(i), 6(d)
or 6(e) of the Employment Agreement will be paid to you on the regularly
scheduled payment date for such Base
Salary.
|
|
10.
|
Timing of Severance
Payment Based on Pension Plan and Supplemental Plan
Accrual. In the event that the payment described in
Section 6(f)(i) of the Employment Agreement becomes payable under such
section, it will be paid in a lump sum on the Release Effective
Date.
|
|
11.
|
Termination for Good
Reason. The 15-day notice of termination period
described in Section 6(g)(i) of the Employment Agreement will be extended
to a 60-day period, and a termination of your employment, as specified in
such notice, will occur no later than the second anniversary of the date
of the occurrence of the event giving rise to Good
Reason.
|
|
12.
|
Section 409A of the
Code. Section 7 of the Employment Agreement will be
deleted in its entirety and the following language will be inserted in its
place: “The provisions of this Section 7 shall apply
notwithstanding any provision in this Agreement to the
contrary.
|
|
a.
|
Intent to Comply with
Section 409A of the Code. It is intended that the provisions of
this Agreement comply with Section 409A of the Code, and all provisions of
this Agreement shall be construed and interpreted in a manner consistent
with the requirements for avoiding taxes or penalties under Section 409A
of the Code.
|
|
b.
|
Six-Month Delay of
Certain Payments. If, at the time of the Executive’s
separation from service (within the meaning of Section 409A of the Code),
(i) the Executive shall be a specified employee (within the meaning of
Section 409A of the Code and using the identification methodology selected
by the Company from time to time) and (ii) the Company shall make a good
faith determination that an amount payable under this Agreement or any
other plan, policy, arrangement or agreement of or with the Company or any
Related Company (this Agreement and such other plans, policies,
arrangements and agreements, the “Company Plans”) constitutes deferred
compensation (within the meaning of Section 409A of the Code) the payment
of which is required to be delayed pursuant to the six (6)-month delay
rule set forth in Section 409A of the Code in order to avoid taxes or
penalties under Section 409A of the Code, then the Company (or a Related
Company, as applicable) shall not pay any such amount on the otherwise
scheduled payment date but shall instead accumulate such amount and pay
it, without interest, on the first day of the seventh (7th) month
following such separation from
service.
|
|
c.
|
Prohibition of
Offsets. Except as permitted under Section 409A of the Code, any
deferred compensation (within the meaning of Section 409A of the Code)
payable to or for the benefit of the Executive under any Company Plan may
not be reduced by, or offset against, any amount owing by the Executive to
the Company or any Related Company.
|
|
d.
|
Amendment of Deferred
Compensation Plans; Indemnification for Section 409A
Taxes. From and after the Effective Date and for the
remainder of the Term, (i) the Company shall administer and operate this
Agreement and any “nonqualified deferred compensation plan” (as defined in
Section 409A of the Code) (and any other arrangement that could reasonably
be expected to constitute such a plan) in which the Executive participates
and the Executive’s rights and benefits hereunder and thereunder in
compliance with Section 409A of the Code and any rules, regulations or
other guidance promulgated thereunder as in effect from time to time, (ii)
in the event that the Company determines that any provision of this
Agreement or any such plan or arrangement does not comply with Section
409A of the Code or any such rules, regulations or guidance and that the
Executive may become subject to additional taxes and penalties under
Section 409A of the Code (“Section 409A Tax”), the Company shall amend or
modify such provision to avoid the application of such Section 409A Tax
but only to the minimum extent necessary to avoid the application of such
Section 409A Tax and only to the extent that the Executive would not, as a
result, suffer (A) any reduction in the total present value of the amounts
otherwise payable to the Executive (determined without application of the
Section 409A Tax), or the benefits otherwise to be provided to the
Executive, by the Company, (B) any material increase in the risk of the
Executive not receiving such amounts or benefits which he would have
received without the application of the Section 409A Tax and any amendment
pursuant to this Section 7 or (C) unless the Executive otherwise expressly
consents in writing, any significant reduction in the Executive’s legal
rights under this Agreement or any Company Plan, and (iii) in the event
that, notwithstanding the foregoing, the Executive is subject to a Section
409A Tax with respect to any such provision, the Company shall indemnify
and hold the Executive harmless against all taxes (and any interest or
penalties imposed with respect to such taxes) imposed as a result of the
Company’s failure to comply with clause (i) of this Section
7(d). The provisions of Sections 10(c), (d), (e) and (f)
shall apply mutatis mutandis to any claim by the IRS that, if successful,
would give rise to indemnification by the Company under this Section
7(d).
|
|
e.
|
Payment Schedules
Relating to Tax Indemnification. Any amounts payable to
the Executive in respect of indemnification pursuant to Section 7(d) for
the Section 409A Tax or the Excise Tax Adjustment Payment pursuant to
Section 10(a) shall be paid to the Executive as soon as practicable after
the applicable liability is incurred, but in any event not later than the
last day of the calendar year after the calendar year in which the
Executive remits the applicable taxes, interest or penalties to the
applicable taxing authority, in accordance with Treas. Reg. Section
1.409A-3(i)(1)(v) or any successor thereto. Furthermore, any
amounts that the Executive becomes entitled to receive in respect of costs
and expenses incurred in connection with a contest relating to Section
7(d) or 10(e) shall be paid to the Executive as soon as practicable after
the applicable cost is incurred, but in any event not later than the later
of (i) the last day of the calendar year after the calendar year in which
the Executive remits the underlying taxes to the applicable taxing
authority and (ii) the last day of the calendar year after the calendar
year in which the applicable contest is
concluded.
|
|
f.
|
Designation of
Installments as Separate Payments. For purposes of
Section 409A of the Code, each installment payment to the Executive
provided for in this Agreement or any Company Plan shall be deemed to be a
“separate payment” within the meaning of Treas. Reg. Section
1.409A-2(b)(iii) or any successor
thereto.
|
|
g.
|
Timing of
Reimbursement Payments and Other Benefits. Except as
specifically permitted by Section 409A of the Code, the benefits and
reimbursements, including for legal fees, provided to the Executive under
this Agreement and any Company Plan during any calendar year shall not
affect the benefits and reimbursements to be provided to the Executive
under the relevant section of this Agreement or Company Plan in any other
calendar year and the right to such benefits and reimbursements cannot be
liquidated or exchanged for any other benefit, in accordance with Treas.
Reg. Section 1.409A-3(i)(1)(iv) or any successor
thereto. Furthermore, reimbursement payments shall be made to
the Executive as promptly as practicable following the date that the
applicable expense is incurred, but in any event not later than the last
day of the calendar year following the calendar year in which the
underlying fee, cost or expense is
incurred.
|
|
h.
|
Timing of Transition
Services. The use of any transition counseling services
provided in this Agreement, if desired, shall begin prior to the first
(1st) anniversary of the date of termination, and must end prior to the
last day of the second (2nd) calendar year following the year in which the
date of termination occurs.”
|
|
13.
|
Legal
Fees. The legal fees described in Section 8 and Appendix
IV of the Employment Agreement will be paid or recovered under the
relevant provision only if you incur the applicable fees, cost or expenses
prior to the tenth anniversary of the expiration of the
Term.
|
|
14.
|
Amendment
Procedures. The final sentence of Section 16 of the
Employment Agreement shall be amended and restated in its entirety to read
as follows: “Except as specifically provided in Section 7
thereof, no amendments or modifications to this Agreement may be made
except in writing signed by the Company (as authorized by the Board or the
Committee) and the Executive.”
|
|
15.
|
“Code”
Definition. The definition of “Code” in the Employment
Agreement will include the regulations thereunder as in effect from time
to time.
|
|
16.
|
Indemnification. Any
indemnification payments made to you pursuant to Appendix IV of the
Employment Agreement will be made to you in a manner that does not cause
such payments to constitute deferred compensation under Treas. Reg.
1.409A-1(b)(10) and any successor
thereto.
|
|
17.
|
Full Force and
Effect. For the avoidance of doubt, except to the extent
expressly modified by this letter agreement, all terms of the Employment
Agreement will remain in full force and effect following the date of this
letter agreement.
|
|
18.
|
Governing
Law. The validity, interpretation, construction, and
performance of this letter agreement shall be governed by the laws of the
State of Illinois, without regard to its choice of laws provisions, for
contracts made and to be performed wholly in such state; provided, however, that
your rights to indemnification under paragraph 16 of this letter agreement
shall be governed by the laws of the State of
Delaware.
|
|
19.
|
Headings. Headings
to paragraphs hereof are for convenience of reference only and shall not
be construed to alter or affect the meaning of any provision of this
letter agreement.
|
|
20.
|
Entire
Agreement. This letter agreement, together with the
Employment Agreement and the appendices attached thereto, contains the
entire agreement between you and Brunswick concerning the subject matter
hereof and supersedes all prior agreements, understandings, discussions,
negotiations and undertakings, whether written or oral, between you and
Brunswick with respect hereto. You acknowledge and agree that
this letter agreement constitutes an amendment to the Employment Agreement
in respect of your participation and rights to any benefits
thereunder. This letter agreement may not be modified or
amended except by a writing signed by each of the parties
hereto.
|
|
21.
|
Counterparts. This
letter agreement may be executed in two or more counterparts, any one of
which shall be deemed the original without reference to the
others.
|
| [________], 2008 | BRUNSWICK CORPORATION, |
| by: | |
|
Name:
|
|
|
Title:
|
| [________], 2008 | [ ] |
| by: | |