Exhibit 10.7
EXECUTIVE LEADERSHIP GROUP
AGREEMENT
United Technologies
Corporation
The undersigned Executive
acknowledges receipt of the materials summarizing the
Corporation’s Executive Leadership Group (“ELG”)
Program and the benefits available to the Executive as a member of
ELG as well as the Executive’s obligations and commitments to
the Corporation as an ELG member. ELG benefits include a restricted
share unit retention award that vests at retirement (age 62
minimum), supplemental life insurance and disability benefits, a
flexible perquisites allowance and eligibility for the standard ELG
severance benefit as set forth in the pre-retirement ELG Standard
Separation Agreement as set forth in Attachment B. The ELG Standard
Separation Agreement provides for severance benefits in the event
of a Mutually Agreeable Termination before age 62 or an involuntary
termination or termination for Good Reason following a Change in
Control. Severance benefits are not provided in the case of a
Termination for Cause. Capitalized terms in this Membership
Agreement and the ELG Standard Separation Agreement are defined in
Attachment A.
While employed and for a two-year
period following termination of employment, ELG members must agree
to protect Company information and to refrain from activities that
could lead to the recruitment of Company employees. If eligible for
the ELG Standard Separation Agreement in the event of a qualifying
termination prior to age 62, or upon vesting in the ELG restricted
share unit retention award at retirement on or after age 62, an ELG
member must make additional commitments to the Company, including a
non-compete agreement and a waiver of claims arising from or
relating to the termination of the Executive’s employment.
Such post employment covenants are set forth in Attachment
B.
1
ELG membership requires commitment
to share ownership guidelines. The value of an ELG member’s
UTC share ownership must equal or exceed an amount equal to 3 times
annual base salary within five years of appointment to the
ELG.
In consideration of the ELG
benefits, the Executive hereby commits to membership in the ELG in
accordance with the terms and conditions set forth in this
Agreement and further described in the ELG program materials and
hereby acknowledges and accepts postemployment restrictions and
protective covenants as described therein. The Company, in turn,
agrees to provide ELG benefits to the Executive upon its receipt of
this Agreement in accordance with this Agreement and as described
in the ELG program summary.
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Executive
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Date
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UNITED
TECHNOLOGIES CORPORATION
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By
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Date
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2
Attachment A
Definitions
. The following terms shall have the
following meanings for purposes of the Executive Leadership Group
Agreement and the ELG Standard Separation Agreement set forth in
Attachment B:
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a)
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“Change
in Control” means the acquisition of 30% or more of the
Company’s outstanding voting shares by a third person or
group (as defined in Section 13 (d) (3) of the
Securities Exchange Act of 1934) of which such person is a member,
or a change in the majority of the Board of Directors such that,
within any consecutive two-year period, the members of the new
majority are not approved by two-thirds of the members incumbent at
the beginning of such two-year period. Members approved after such
date by two-thirds of such incumbents as of the beginning of such
two-year period shall be deemed to be incumbents as of the
beginning of such two-year period for purposes of this computation.
A merger or consolidation of the Corporation with another company
where the Corporation is not the surviving company, a sale of
substantially all of the assets of the Corporation, a dissolution
or liquidation of the Corporation or other event or transaction
having similar effect also constitutes a “Change in
Control” for purposes of this Agreement. Any Change in
Control event must constitute either a “change in
ownership”, a “change in effective control” or a
“change in the ownership of a substantial portion of the
Company’s assets” within the meaning of
Section 409A.
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b)
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“Change
in Control Termination” means either the involuntary
termination of the Executive’s employment by the Company
(other than a Termination for Cause) or the voluntary resignation
by the executive for Good Reason within 24 months following a
Change in Control. Notwithstanding the foregoing, any executive
will not be eligible for the standard ELG severance benefit in the
event of Termination for Cause or for executives who become ELG
members after December 1, 2005 whose employment terminates
after age 62 and who have vested in the ELG retention
grant.
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3
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c)
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“Good
Reason” means voluntarily termination of the
Executive’s employment within twenty-four (24) months of
a Change in Control and the occurrence of any one or more of
the following:
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(i)
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The assignment
of the Executive to duties materially inconsistent with the
Executive’s authorities, duties, responsibilities, and status
(including reporting relationships) as an employee of the Company,
or a material reduction or change in the nature or status of the
Executive’s authorities, duties, or responsibilities from
those in effect immediately preceding a Change in
Control;
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(ii)
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The
Company’s requiring the Executive to be based at a location
which is at least fifty (50) miles further from the current
primary residence than is such residence from the Company’s
current headquarters, except for required travel on the
Company’s business to an extent substantially consistent with
the Executive’s business obligations immediately preceding
the Change in Control;
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(iii)
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A reduction by
the Company in the Executive’s Base Salary in effect on the
date preceding the Change in Control;
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(iv)
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A material
reduction in the Executive’s level of participation in any of
the Company’s short- and/or long-term incentive compensation
plans, or employee benefit or retirement plans, policies,
practices, or arrangements in which the Executive participates from
the levels in place during the fiscal year immediately preceding
the Change in Control; provided, however, that reductions in the
levels of participation in any such plans shall not be deemed to be
“Good Reason” if the Executive’s reduced level of
participation in each such program remains substantially consistent
with the average level of participation of other executives who
have positions commensurate with the Executive’s position;
or
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(v)
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The failure of
the Company to obtain a satisfactory
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