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Agco Corp/DE – ‘10-Q’ for 6/30/19 – ‘EX-10.3’

On: Friday, 8/9/19, at 9:36am ET · For: 6/30/19 · Accession #: 880266-19-33 · File #: 1-12930

  As Of               Filer                 Filing    For·On·As Docs:Size

 8/09/19  Agco Corp/DE                      10-Q        6/30/19  100:15M

Quarterly Report — Form 10-Q — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        Quarterly Report                                    HTML   1.74M 
 2: EX-10.2     Material Contract                                   HTML    114K 
 3: EX-10.3     Material Contract                                   HTML     65K 
 4: EX-31.1     Certification -- §302 - SOA'02                      HTML     34K 
 5: EX-31.2     Certification -- §302 - SOA'02                      HTML     34K 
 6: EX-32.1     Certification -- §906 - SOA'02                      HTML     29K 
13: R1          Cover Page                                          HTML     80K 
14: R2          Condensed Consolidated Balance Sheets               HTML    138K 
15: R3          Condensed Consolidated Balance Sheets               HTML     45K 
                (Parenthetical)                                                  
16: R4          Condensed Consolidated Statements of Operations     HTML    107K 
17: R5          Condensed Consolidated Statements of Comprehensive  HTML     58K 
                Income                                                           
18: R6          Condensed Consolidated Statements of Cash Flows     HTML    118K 
19: R7          Basis of Presentation                               HTML     45K 
20: R8          Restructuring Expenses                              HTML     57K 
21: R9          Stock Compensation Plans                            HTML     70K 
22: R10         Goodwill and Other Intangible Assets                HTML     90K 
23: R11         Indebtedness                                        HTML     64K 
24: R12         Recoverable Indirect Taxes (Notes)                  HTML     30K 
25: R13         Inventories                                         HTML     38K 
26: R14         Product Warranty                                    HTML     52K 
27: R15         Net Income Per Common Share                         HTML     65K 
28: R16         Income Taxes                                        HTML     33K 
29: R17         Derivative Instruments and Hedging Activities       HTML    167K 
30: R18         Changes in Stockholders' Equity                     HTML    377K 
31: R19         Accounts Receivable Sales Agreements (Notes)        HTML     36K 
32: R20         Employee Benefit Plans                              HTML     94K 
33: R21         Fair Value of Financial Instruments                 HTML     54K 
34: R22         Segment Reporting                                   HTML    150K 
35: R23         Commitments and Contingencies                       HTML     37K 
36: R24         Revenue (Notes)                                     HTML    402K 
37: R25         Leases                                              HTML    222K 
38: R26         Basis of Presentation (Policies)                    HTML     48K 
39: R27         Restructuring Expenses (Tables)                     HTML     56K 
40: R28         Stock Compensation Plans (Tables)                   HTML     65K 
41: R29         Goodwill and Other Intangible Assets (Tables)       HTML     94K 
42: R30         Indebtedness (Tables)                               HTML     46K 
43: R31         Inventories (Tables)                                HTML     39K 
44: R32         Product Warranty (Tables)                           HTML     48K 
45: R33         Net Income Per Common Share (Tables)                HTML     63K 
46: R34         Derivative Instruments and Hedging Activities       HTML    175K 
                (Tables)                                                         
47: R35         Changes in Stockholders' Equity (Tables)            HTML    278K 
48: R36         Employee Benefit Plans (Tables)                     HTML    113K 
49: R37         Fair Value of Financial Instruments (Tables)        HTML     84K 
50: R38         Segment Reporting (Tables)                          HTML    156K 
51: R39         Revenue (Tables)                                    HTML    385K 
52: R40         Leases (Tables)                                     HTML    159K 
53: R41         Basis of Presentation (Narrative) (Details)         HTML     41K 
54: R42         Restructuring Expenses (Details)                    HTML     59K 
55: R43         Stock Compensation Plans (Narrative) (Details)      HTML     84K 
56: R44         Stock Compensation Plans (Schedule of Employee      HTML     35K 
                Service Share-based Compensation, Allocation of                  
                Recognized Costs) (Details)                                      
57: R45         Stock Compensation Plans (Performance Award         HTML     38K 
                Transactions) (Details)                                          
58: R46         Stock Compensation Plans (Restricted Stock Unit     HTML     38K 
                Award Transactions) (Details)                                    
59: R47         Stock Compensation Plans (SSAR Activity) (Details)  HTML     38K 
60: R48         Goodwill and Other Intangible Assets (Schedule of   HTML     61K 
                Change in Carrying Amount) (Details)                             
61: R49         Goodwill and Other Intangible Assets                HTML     32K 
                (Indefinite-Lived Intangible Assets) (Details)                   
62: R50         Goodwill and Other Intangible Assets (Schedule of   HTML     41K 
                Goodwill) (Details)                                              
63: R51         Indebtedness (Components Of Indebtedness)           HTML     63K 
                (Details)                                                        
64: R52         Indebtedness (Narrative) (Details)                  HTML    134K 
65: R53         Recoverable Indirect Taxes (Details)                HTML     28K 
66: R54         Inventories (Details)                               HTML     41K 
67: R55         Product Warranty (Details)                          HTML     49K 
68: R56         Net Income Per Common Share (Details)               HTML     58K 
69: R57         Income Taxes (Details)                              HTML     33K 
70: R58         Derivative Instruments and Hedging Activities       HTML     47K 
                (Narrative) (Details)                                            
71: R59         Derivative Instruments and Hedging Activities       HTML     50K 
                (After-Tax Impact of Changes in Fair Value and                   
                Derivatives Designated as Cash) (Details)                        
72: R60         Derivative Instruments and Hedging Activities       HTML     62K 
                (Summary Of Accumulated Other Comprehensive Loss                 
                Related To Derivatives) (Details)                                
73: R61         Derivative Instruments and Hedging Activities       HTML     45K 
                (Notional Values and After-Tax Impact of Changes                 
                in Fair Value) (Details)                                         
74: R62         Derivative Instruments and Hedging Activities       HTML     62K 
                (Fair Value Of Derivative Instruments) (Details)                 
75: R63         Changes in Stockholders' Equity (Schedule of        HTML     97K 
                Stockholders' Equity) (Details)                                  
76: R64         Changes in Stockholders' Equity (Schedule of        HTML     40K 
                Comprehensive Income for Noncontrolling Interest)                
                (Details)                                                        
77: R65         Changes in Stockholders' Equity (Changes in         HTML     58K 
                Accumulated Other Comprehensive Income) (Details)                
78: R66         Changes in Stockholders' Equity (Reclassifications  HTML     73K 
                out of Accumulated Other Comprehensive Income)                   
                (Details)                                                        
79: R67         Changes in Stockholders' Equity (Narrative)         HTML     38K 
                (Details)                                                        
80: R68         Accounts Receivable Sales Agreements (Details)      HTML     36K 
81: R69         Employee Benefit Plans (Net Pension And             HTML     51K 
                Postretirement Cost) (Details)                                   
82: R70         Employee Benefit Plans (Net Periodic Pension Costs  HTML     61K 
                Included in Accumulated Other Comprehensive Income               
                (Loss)) (Details)                                                
83: R71         Employee Benefit Plans (Narrative) (Details)        HTML     36K 
84: R72         Fair Value of Financial Instruments (Details)       HTML     47K 
85: R73         Segment Reporting (Sales Information By Reportable  HTML     63K 
                Segments) (Details)                                              
86: R74         Segment Reporting (Income From Operations And       HTML     69K 
                Total Assets) (Details)                                          
87: R75         Commitments and Contingencies (Details)             HTML     39K 
88: R76         Revenue (Significant Changes in Contract Assets     HTML     39K 
                and Liabilities) (Details)                                       
89: R77         Revenue (Remaining Performance Obligation           HTML     47K 
                Narrative) (Details)                                             
90: R78         Revenue (Disaggregation of Revenue) (Details)       HTML    546K 
91: R79         Leases (Narrative) (Details)                        HTML     33K 
92: R80         Leases (Assets and Liabilities) (Details)           HTML     49K 
93: R81         Leases (Lease Cost) (Details)                       HTML     43K 
94: R82         Leases (Future Minimum Lease Payments) (Details)    HTML    117K 
95: R83         Leases (Weighted-Average Remaining Lease Term and   HTML     38K 
                Weighted-Average Discount Rate) (Details)                        
96: R84         Leases (Supplemental Cash Flow Information)         HTML     40K 
                (Details)                                                        
98: XML         IDEA XML File -- Filing Summary                      XML    188K 
12: XML         XBRL Instance -- a2019agcoq2-10xq_htm                XML   5.21M 
97: EXCEL       IDEA Workbook of Financial Reports                  XLSX    113K 
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10: EX-101.LAB  XBRL Labels -- agco-20190630_lab                     XML   1.98M 
11: EX-101.PRE  XBRL Presentations -- agco-20190630_pre              XML   1.25M 
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99: JSON        XBRL Instance as JSON Data -- MetaLinks              431±   641K 
100: ZIP         XBRL Zipped Folder -- 0000880266-19-000033-xbrl      Zip    359K

‘EX-10.3’ — Material Contract

This Exhibit is an HTML Document rendered as filed. [ Alternative Formats ]

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Exhibit

Exhibit 10.3

AGCO CORPORATION

AMENDED AND RESTATED
MANAGEMENT INCENTIVE PLAN

As amended through July 25, 2019


I.	PURPOSE; EFFECTIVE DATE; PLAN YEAR

1.1 Purpose. Consistent with AGCO’s compensation philosophy, the purpose of this Management Incentive Plan (“Plan”) is to facilitate alignment of management with corporate objectives and shareholder interests, in order to achieve outstanding performance and to meet specific AGCO Corporation (“Corporation”) financial goals. It is the intention of the Corporation to establish an incentive compensation plan where payments are competitive, tied to performance and offer shareholder protection, and assist with the attraction and retention of key management staff.

1.2 Effective Date. The Plan, as amended, will be deemed effective as of January 1, 2019.

1.3 Plan Year. The “Plan Year” shall be the 12-month period ending December 31 of each year.


II.	ADMINISTRATION OF THE PLAN

Subject to the provisions of the Plan, unless determined otherwise by the Corporation’s Board of Directors, the Compensation Committee of the Board of Directors (“Committee”) shall have the sole authority and discretion:


•	To construe and interpret the Plan;


•	To establish, amend, change, add to, alter and/or and rescind rules, regulations and guidelines for administration of the Plan;


•	To make all designations and determinations specified in the Plan;


•	Except as noted herein, to determine the amount of awards and payments to be made under the Plan and the status and rights of any Participant to payments under the Plan; and


•	To decide all questions concerning the Plan and to make all other determinations and to take all other steps necessary or advisable for the administration of the Plan.


III.	PLAN FUNDING

The Plan will be funded annually as a part of the Corporation’s annual budgeting process.


IV.	ELIGIBILITY

Participation is limited to key full-time personnel of the Corporation and its subsidiaries who have the ability to materially impact the financial success of the Corporation and have an acceptable performance review or rating. Management will select the participants each year with the approval of the Senior Vice President, Human Resources. Notwithstanding the foregoing, the Committee must approve all awards to elected officers of the Corporation. As a guideline, eligible jobs should fall in Bands 5 and above. The Plan replaces any other type of bonus or non-qualified profit sharing program that a participant may have participated in previously.


V.	AWARD OPPORTUNITY

Target incentive awards will be a percentage of a participant’s salary for the Plan Year. The Committee may change the target award levels from time-to-time as it deems advisable. Initial target award levels (as of 2019) are:


•	CEO: 140%


•	CFO, COO: 100%


•	GM, Europe/Middle East 100%


•	Other GMs: 90%


•	Other SVPs: 80%


•	Other Participants: Not more than 40%


VI.	PERFORMANCE CRITERIA AND GOALS

6.1 Performance Criteria. Awards under the Plan may be based upon corporate, regional/functional or personal goals. Generally, three to seven performance measures will be used to measure performance, and will differ depending on participant’s position with the Corporation. The initial performance measures (as of 2019) are:



Global/Corporate	Regional Participants
• Corporate: - Operating margin as a percentage of net sales - Free Cash Flow	• Corporate: - Operating margin as a percentage of net sales - Free Cash Flow • Regional: - Regional equivalents of Corporate goals

6.2 Performance Measures. Unless the Committee specifies otherwise, performance measures for executive officers shall consist of one or more of the following, which may be applied on a company-wide, geographic or operating unit basis:


•	earnings per share and/or growth in earnings per share in relation to target objectives;


•	operating or free cash flow and/or growth in operating or free cash flow in relation to target objectives;


•	cash available in relation to target objectives;


•	operating income and/or growth in operating income in relation to target objectives;


•	margin and/or growth in margins (gross, operating or otherwise) in relation to target objectives;


•	net income and/or growth in net income in relation to target objectives;


•	revenue and/or growth in revenue in relation to target objectives;


•	total stockholder return (measured as the total of the appreciation of and dividends declared on the common stock) in relation to target objectives;


•	return on invested capital in relation to target objectives;


•	productivity and/or improvement in productivity;


•	achievement of milestones on special projects;


•	return on stockholder equity in relation to target objectives;


•	return on assets in relation to target objectives;


•	return on common book equity in relation to target objectives; and


•	customer satisfaction and/or improvement in customer satisfaction.

Specific definitions initially (as of 2019) shall be:


•	EPS: Diluted and adjusted to exclude restructuring and certain other infrequent items.


•	Free Cash Flow: Cash flow from operations less capital expenditures. Excludes cash flow from financing such as increases in accounts receivables securitizations.


•	Customer Satisfaction: Overall customer satisfaction index that measures after-sales service, sales experience and product quality.


•	Functional/Regional: Must be approved by the appropriate Senior Vice President, CEO or CFO.

6.3 Weighting of Measures. The weighting will differ depending on a participant’s position with the Corporation. The initial weighting (as of 2019) will be:



Global/Corporate	Regional Participants
• Corporate Performance - Operating Margin as a percentage of sales: 70% - Free Cash Flow: 30%	• Corporate Performance: 50% - Operating Margin as a percentage of sales: 70% - Free Cash Flow: 30% • Regional Performance: 50% - Regional equivalent of Corporate goals

6.4 Performance Goals. The Committee shall approve annual written objective performance goals reflecting corporate performance not later than ninety (90) days after the commencement of the Plan Year to which the goals relate. Such performance goals must be uncertain of achievement at the time that they are established and determinable by a third party with knowledge of the relevant facts.


VII.	PLAN TRIGGER; PAYMENT OF AWARDS; ADJUSTMENTS; DISCRETIONARY AWARDS

7.1 Plan Trigger. Incentive awards will not be paid for any category of performance measurement unless the Corporation achieves the minimally acceptable specified plan trigger, which may be specified as a percentage of budget. Notwithstanding the foregoing, the Committee may waive one or more triggers.

7.2 Payment of Awards. If a plan trigger is achieved, achievement of performance measures, based on year-end results and other measurements, are determined for each incentive category or measure with a total earned performance award being the sum of these measures (i.e., corporate and functional/regional). Payments shall be made not later than March 15th of the year following the Plan Year for participants that are U.S. taxpayers and not later than March 31^st of the year following the Plan Year for non-U.S. taxpayers. The achievement of the plan triggers and payouts must be approved in advance by the Committee. The target incentive award is determined by a percentage of the actual gross base salary earned by the employee during the relevant plan year (exclusive of bonus or other W-2 adjustments for moving expense, perquisites or other fringe benefits). The range of awards will vary based on performance from 0% to 200% of target bonus levels. The initial range (as of 2019) shall be:



Performance Level as a % of Goal	Payout Level as a % of Target Bonus

	CEO	CFO/COO	SVP EME	GMs	OTHER
Minimum: 80%	70%	50%	50%	45%	40%
Target: 100%	140%	100%	100%	90%	80%
Maximum: 140%	280%	200%	200%	180%	160%

Notwithstanding the foregoing, in no event may a participant receive more than $4,000,000 in a plan year.

Other payment considerations include:


•	If a participant is transferred into another position that is also eligible for the Plan, the participant’s award will be pro-rated based on the number of months during a Plan Year in each position.


•	If a participant is promoted to a higher level position during a Plan Year, the participant’s award will be based on the number of months worked in each position and the base pay and target award for each position.


•	If a participant is hired during a Plan Year, the participant’s award will be based on the number of complete months/pay period the participant was employed during the year.


•	If a participant terminates employment prior to the end of a Plan Year due to death, approved retirement or disability, the participant (or the participant’s designated beneficiary) will receive a pro-rata share, based on gross base salary to the date of termination and actual performance, when awards are paid to all other participants.


•	If a participant terminates his or her employment before the completion of the last day of the Plan Year, for reasons other than death, approved retirement or disability, then the participant will forfeit any award.


•	If a participant is terminated without cause before the completion of the last day of the Plan Year, for reasons other than death, approved retirement or disability, then the participant will receive a pro-rata share based on gross base salary to the date of termination and actual performance, when awards are paid to other participants.


•	If a participant is terminated without cause or terminates his or her employment after the end of the Plan Year but before the award is paid, the participant will receive (based on performance) a complete award when paid to all other recipients.


•	If a participant is terminated for cause at any time before the award is paid, the participant will forfeit payment of the award.

7.3 Adjustments. The Committee has the authority to make adjustments to the plan’s performance measures in the event of certain circumstances or uncontrollable events, which include, but are not limited to:


•	Significant one-time unexpected restructuring expenses


•	Significant unplanned costs associated with a merger or acquisition


•	Significant unplanned net income adjustments for debt refinancing


•	Significant unplanned or unexpected taxes and/or legal charges associated with changes in legislation


•	Changes in generally accepted accounting principles (GAAP) or the impact of any extraordinary items as determined under GAAP

7.4 Discretionary Awards. As appropriate, the Committee may make special awards for participants (at the time of grant in lieu of performance-based awards or at any time in addition to any other awards). Notwithstanding the foregoing, discretionary awards are separate and distinct awards and shall not be contingent upon the failure to pay any other performance-based award.

7.5 Change in Control. In the event of a change in control, the following payments shall be made. Promptly following the date of a change in control (but in all events within thirty (30) days thereafter), each participant will be paid a pro rata portion of his or her bonus, based on actual performance as of such date extrapolated for a full Plan year. Such extrapolation shall be based upon results through the month most recently complete prior to the change in control. The

pro rata portion shall be determined using a fraction where the numerator is the number of days from the beginning of the Plan year until and including the date of the change in control and the denominator is 365.

If within two years following a change in control a participant who is identified in writing by the Committee as being expressly subject to this paragraph is terminated without cause, the participant will receive (i) a pro-rata share of his or her bonus, based on gross base salary to the date of termination and actual performance as of the date of termination extrapolated for a full Plan year and (ii) an amount equal to the average of the awards actually earned by the participant during the prior two completed Plan years and the current year’s bonus extrapolated actual performance. Any such extrapolation shall be based upon results through the month most recently complete prior to the termination. Such payments shall be made promptly after the termination (but in all events within thirty (30) days thereafter). The pro rata calculation shall be made in the same manner as described in the immediately preceding paragraph, except that the numerator shall be determined until and including the date of termination.

To the extent that a payment is due to a participant under any other section of this plan with respect to a year that includes the portion of the year covered by this section, the Company shall be entitled to receive a credit against such subsequent payment for payments made pursuant to this section.

For the purposes of this plan, the term “change in control” shall mean change in the ownership of the Company, change in the effective control of the Company or change in ownership of a substantial portion of the Company’s assets, as described in Section 280G of the Code, including each of the following: (i) a change in the ownership of the Company occurs on the date that any one person, or more than one person acting as a group, acquires ownership of stock of the Company that, together with stock held by such person or group, possess more than fifty percent (50%) of the total fair market value or total voting power of the stock of the Company (unless any one person, or more than one person acting as a group, who is considered to own more than fifty percent (50%) of the total fair market value or total voting power of the stock of the Company, acquires additional stock); (ii) change in the effective control of the Company is presumed (which presumption may be rebutted by the Committee) to occur on the date that either: any one person, or more than one person acting as a group, acquires (or has acquired during the twelve (12)-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the Company possessing thirty percent (30%) or more of the total voting power of the stock of such Company; (iii) a majority of members of the Company’s Board is replaced during any twelve (12)-month period by directors whose appointment or election is not endorsed by a majority of the members of the Company’s Board prior to the date of the appointment or election of such new directors; or (iv) a change in the ownership of a substantial portion of the Company’s assets occurs on the date that any one person, or more than one person acting as a group, acquires (or has acquired during the twelve (12)-month period ending on the date of the most recent acquisition by

such person or persons) assets from the Company that have a total fair market value equal to forty percent (40%) or more of the total fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions unless the assets are transferred to: a stockholder of the Company (immediately before the asset transfer) in exchange for or with respect to its stock; an entity, fifty percent (50%) or more of the total value or voting power of which is owned, directly or indirectly by the Company; a person, or more than one person acting

as a group, that owns, directly or indirectly, fifty percent (50%) or more of the total value or voting power of all of the outstanding stock of the Company; or an entity, at least fifty percent (50%) of the total value or voting power is owned, directly or indirectly, by a person, or more than one person acting as a group, that owns directly or indirectly, fifty percent (50%) or more of the total value of voting power of all of the outstanding stock of the Company.


VIII.	MISCELLANEOUS PROVISIONS

8.1 Successors. All obligations of the Corporation under the Plan with respect to awards granted hereunder shall be binding on any successor to the Corporation, whether the existence of such successor is the result of a direct or indirect purchase of all or substantially all of the business and/or assets of the Corporation, or a merger, consolidation, or otherwise.

8.2 No Lien. This Plan does not give a Participant any interest, lien, or claim against any specific asset of the Corporation. Participants and beneficiaries shall have only the rights of a general unsecured creditor of the Corporation.

8.3 Termination and Amendment. The Plan may be terminated or amended by the Committee at any time, provided, however, that a termination or amendment shall not materially negatively impact awards that are outstanding as of the time of termination or amendment except as required by law.

8.4 No Employment Rights. No participant has any right to be retained in the employ of the Corporation or any subsidiary by virtue of participation in the Plan.

8.5 Governing Law. The Plan and awards hereunder shall be governed by and construed according to the laws of the State of Georgia.

Dates Referenced Herein

This ‘10-Q’ Filing	Date	Other Filings

Filed on:	8/9/19	None on these Dates
	7/25/19
For Period end:	6/30/19
	1/1/19
		List all Filings

2 Subsequent Filings that Reference this Filing

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 2/25/22  AGCO Corp.                        10-K       12/31/21  151:24M
 3/01/21  AGCO Corp.                        10-K       12/31/20  142:23M

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Filing Submission 0000880266-19-000033 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)