Chief Executive Officer Transition Agreement dated April 22, 2021 effective December 31, 2021

Contract Categories: Human Resources - Transition Agreements
EX-10.4 4 exhibit104.htm CEO TRANSITION AGREEMENT exhibit104
This Transition Agreement (this “
”), dated as of April 22, 2021 is made between Michael F.
Barry (“
and Quaker Chemical Corporation (“
” or the “
WHEREAS, Executive and Quaker are parties to the
Employment Agreement dated July 1, 2008 regarding Executive’s
employment as the Company’s
Executive Officer and President (the “
Employment Agreement
WHEREAS, Executive and Quaker contemplate that
effective December 31, 2021, Executive will retire as the
Executive Officer and President and will continue
to serve on the Board of Directors of the Company (the “
”) as a non-
executive director;
WHEREAS, as used in this Agreement, any reference
to Executive shall include Executive and, in their capacities as such,
Executive’s heirs, administrators,
representatives, executors, legatees, successors, agents and
assigns; and
WHEREAS, all capitalized terms used but not defined
in this Agreement shall have the meanings ascribed to such terms
in the
Employment Agreement;
In consideration of the mutual promises, agreements and
representations contained herein, the parties agree as follows:
. Executive shall continue to serve as President and
Chief Executive Officer of the Company,
at his current level of
compensation (including the full amount of his Annual
Plan (
) bonus earned with respect to calendar year 2021)
and benefits (with such increases as may be approved
by the Board) through December 31, 2021. Effective
January 1, 2022,
Executive shall resign as an employee of the Company,
and from such positions and from all positions as an officer
or director of
any Company subsidiary (but, for the sake of clarity,
he shall not be expected to resign as a director of the Company).
with the approval
of the Board, Executive may resign from such positions
prior to January 1, 2022, and in that event may also, if
he desires, resign as an employee prior to January 1, 2022.
In either event, Executive shall make himself reasonably
available to
the Board to provide strategic advice and counsel through
December 31, 2021 and shall continue to receive, through December
31, 2021 the same level of compensation and benefits to
which he was entitled as of the date of his resignation as President
Chief Executive Officer (including the
full amount of his AIP bonus earned with respect to calendar
year 2021).
If the Board
requests, and Executive provides his written consent,
Executive’s employment may
be extended beyond December 31, 2021 at his
current level of compensation and benefits, or upon such
other terms and conditions that the Board and Executive
may mutually
agree. The date of Executive’s
resignation as President and Chief Executive Officer
of the Company is referred to in the
Agreement as the “
Resignation Date.
” Following his resignation as President and Chief Executive
Officer, Executive shall,
subject to further action by the Board, continue to
serve as Chair of the Board, in the capacity as non-executive
If the Resignation Date occurs before January 1, 2022, the
Company shall compensate Executive through
December 31, 2021 as provided in Section 1 above.
From and after January 1, 2022 and continuing for as long
as Executive
serves as a director, the Company
shall compensate Executive for his services as a director on the same
basis as it compensates
the non-management members of the Board and shall
pay him additional compensation of $100,000 per annum (or
such greater
amount as may be approved by the Board)
for his services as non-executive Chair.
Such compensation shall be paid on the same
basis as the compensation payable to the Lead Director
(if there is one, otherwise on the same basis as for those directors serving
as chairs of Board committees), pro-rated in the event of
a partial year; provided that Executive’s
compensation for serving as
non-executive Chair shall, if paid in cash, shall be paid in
monthly installments. The Company shall reimburse Executive for
reasonable business expenses incurred
by him in the performance of duties as a director and non-executive
Chair in accordance
with the Company’s business
expense reimbursement policies. While serving as non
-executive Chair, the Company shall provide
Executive with support services as Executive may reasonably
request, including computer and telephone access, IT support and
support from an administrative assistant.
Non-Executive Chair of the Board.
As the non-executive Chair, it is contemplated
that Executive shall, when present, preside at
all meetings of the Board and at all meetings of shareholders of
the Company, and together
with the President and Chief
Executive Officer and (if there is one) the
Lead Director, set the agenda for meetings
of the Board. In addition, Executive shall,
upon request, provide his advice and counsel with respect
to the transition of management,
new business opportunities, strategic
planning, customer and investor relations and such
other matters as the Company’s
Chief Executive Officer or the Board may
reasonably request.
No Termination
of Service
. Executive and the Company hereby acknowledge that the Compensation
and Human Resources
Committee of the Board (or such other committee described
in the LTIP)
has provided that Executive will not be considered to
have had a “
of Service
” as defined in the LTIP
for so long as Executive is a director or employee of
the Company.
Any further amendment to the interpretation of Termination
of Service will be considered an amendment to an outstanding
pursuant to section 2.6 of the LTIP
and may only be made with the Executive’s
Company’s Obligations
The Company will pay Executive for any amounts of Executive’s
accrued salary payable under the Employment Agreement
and reimbursement for any reasonable business expenses
and other amounts to which Executive is entitled thereunder.
payment will be made in accordance with the Company’s
regular payroll practices.
Executive shall receive
any incentive cash bonus amount accrued or earned by Executive
in accordance with the terms of an
award granted under the AIP or LTIP
prior January 1, 2022 in accordance with the terms of the AIP
or LTIP,
as applicable.
Any such amount shall be paid to Executive as provided
under the AIP or LTIP,
as applicable.
Following the Resignation Date, Executive shall not be
eligible to participate in the Company’s
benefit plans except as
provided below with respect to Executive’s
participation in the Company’s
existing medical plan, as such plan may be
changed by the Company from time to time for its senior employees
generally (“
Medical Coverage
”) and the Company’s
existing short-term disability plan and long-term disability
plan as such plans may be changed by the Company
from time to
time for its senior employees generally (“
Disability Coverage
Subject to approval from the applicable insurance provider,
if any, the Company
shall, until April 30, 2023, permit
Executive to elect Medical Coverage (including medical,
vision and dental coverage) for himself and his family
Executive shall pay the premium cost of the Medical Coverage
he elects at the rate provided to active employees of
the Company, and
on an after-tax basis. In addition, the Company will pay
the portion of the premium cost paid by
the Company for active employees for such Medical Coverage
and the portion of the premium cost paid by the
Company will be includable in Executive’s
taxable income.
Upon the termination of the Medical Coverage, Executive
and if applicable, his family may be eligible to elect
COBRA continuation coverage in accordance with the
terms of the Medical Coverage and applicable law.
If at any time during such period Executive is not eligible
to participate in the Medical Coverage, the Company will
pay to Executive additional compensation in an amount
necessary to purchase coverage similar to the Medical
For as long as Executive is entitled to elect Medical Coverage
from the Company,
Executive will continue to be eligible
for Disability Coverage under the same terms and conditions as
active employees, subject to approval from the applicable
insurance provider, if any.
Executive’s outstanding
equity awards as of December 31, 2021 shall be administered
according to the terms of the
applicable award agreements (the “
Award Agreements
”) and the terms of the LTIP.
In the event of the death of Executive, any payments due
to Executive under this Agreement or the Award
Agreements and
not paid prior to Executive’s
death shall be made to the personal representative of Executive’s
The Company shall withhold from any payments under this
Agreement any federal, state and local taxes that the Company
required to withhold pursuant to any law or governmental
rule or regulation. Executive shall be responsible for all Executive
taxes applicable to amounts payable under this Agreement.
Executive shall not be entitled to any severance amounts
under any severance plans of the Company or the
Restrictive Covenants
. Executive shall comply with the Restrictive Covenants set forth
in Section 6 of the Employment
Agreement (the “
Restrictive Covenants
”) for the applicable periods set forth therein; provided
that, notwithstanding anything to
the contrary in the Employment Agreement, Executive
shall comply with the Restrictive Covenants set forth in Section
6.2 of the
Employment Agreement regarding non-competition
and non-solicitation for so long as he is a member of the Board,
and for a
period of 18 months following the end of Executive’s
Board service.
Return of Property
Executive agrees to return all Company property to the Company
on or before the Resignation Date (other
than as relates to his services as a director,
including his computer, cellphone and
email access) and not retain any property of the
Company (other than his cellphone, computer and any
other items that the Company expressly permits Executive
to keep). To the
extent that Executive retains any such items, or if he made
use of his own personal
computing devices (e.g., cellphone, laptop,
thumb drive, etc.), Executive will, upon request, deliver such
items to the Company for review and will permit the
Company to
delete all Company property and information therefrom,
and/or permit the Company to remotely delete all Company property
information from such items. For the avoidance of doubt,
notwithstanding anything to the contrary,
Executive shall be permitted
to retain his contacts (in electronic and paper form).
The Company shall pack and ship at its expense the personal items of
Executive that are in his office at the Company following
the Resignation Date.
. Executive agrees that, upon the Company’s
reasonable notice to Executive and taking into consideration
Executive’s other commitments and
obligations, Executive shall fully cooperate with the Company
in investigating, defending,
prosecuting, litigating, filing, initiating or asserting any actual or
potential claims or investigations that may be made
by or against
the Company to the extent that such claims or investigations relate
to any matter in which Executive was involved (or alleged to
have been involved) while employed with the Company,
or during his service as a director, of
which Executive has knowledge by
virtue of Executive’s employment
with the Company or Executive’s
capacity as a director of the Company.
The Company will
advance to Executive the reasonable out-of-pocket expenses incurred
in rendering such cooperation.
Permitted Conduct
. Nothing in this Agreement or the Employment Agreement
shall prohibit or restrict Executive from initiating
communications directly with, or responding to any inquiry
from, or providing testimony before, the Equal Employment
Opportunity Commission, the Department of Justice, the
Securities and Exchange Commission, or any other federal,
state or local
regulatory authority.
To the extent permitted
by law, upon receipt of any
subpoena, court order, or other legal process
the disclosure of any confidential information and trade secrets of
the Company, Executive agrees
to give prompt written notice to
the Company so as to permit the Company to protect its interests
in confidentiality to the fullest extent possible. Please take
that federal law provides criminal and civil immunity
to federal and state claims for trade secret misappropriation
to individuals
who disclose a trade secret to their attorney,
a court, or a government official in certain, confidential
circumstances that are set
forth at 18 U.S.C. §§ 1833(b)(1) and 1833(b)(2), related
to the reporting or investigation of a suspected violation of the law,
or in
connection with a lawsuit for retaliation for reporting
a suspected violation of the law.
The Company shall defend and hold Executive harmle
ss to the fullest extent permitted by applicable law in
connection with any claim, action, suit, investigation
or proceeding arising out of or relating to performance by Executive
services for, or action of Executive
hereunder or as a director, officer,
employee or executive of the Company or of any parent,
subsidiary or affiliate of the Company,
or of any other person or enterprise at the Company’s
request. Expenses incurred by
Executive in defending such a claim, action, suit or investigation
or criminal proceeding shall be paid by the Company in
of the final disposition thereof upon the receipt by the Company
of an undertaking by or on behalf of Executive to repay said
amount unless it shall ultimately be determined that Executive
is entitled to be indemnified hereunder; provided, however,
this shall not apply to a nonderivative action commenced
by the Company against Executive. This indemnification
obligation is in
addition to the obligations of the Company pursuant to
its articles of incorporation and bylaws.
Controlling Law
This Agreement and all matters arising out of, or relating
to it, shall be governed by,
and construed in
accordance with, the laws of the Commonwealth of Pennsylvania.
Any action arising out of, or relating to, any breach
of the Restrictive Covenants shall be brought and prosecuted
only in the United States District Court for the Eastern
District of Pennsylvania, or if such court does not have jurisdiction
or will
not accept jurisdiction, in any court
of general jurisdiction in Philadelphia, Pennsylvania, and the
jurisdiction of such court in any
such proceeding shall be exclusive. Executive also irrevocably
and unconditionally consents to the service of any process,
pleadings, notices or other papers.
The parties agree that this Agreement may not be altered,
amended or modified, in any respect, except by a writing
duly executed by both Parties.
Entire Agreement
The parties understand that no promise, inducement or
other agreement not expressly contained herein has
been made conferring any benefit upon them, and that
this Agreement contains the entire agreement between the parties with
respect to the subject matter hereof, and that the terms of
this Agreement are contractual and not recitals only.
Prior to the
Resignation Date, the Employment Agreemen
shall apply to any termination of Executive’s
employment with the Company,
provided, however, that in the
event of a Separation from Service prior to the Resignation
Date, by action of the Company for any
reason other than Cause or the death or Disability of the
Executive, Executive shall receive the same compensation and benefits
that he would receive in the event of a resignation
prior to January 1, 2022, as set forth in Section 1 of this Agreement,
in lieu of
any payment under Section 4.4 of the Employment
Agreement. Following the Resignation Date, the provisions of
this Agreement
shall govern Executive’s service
as a director other than those provisions of the Employment
Agreement that by their terms apply
following termination of Executive’s
as Chief Executive Officer and President of the Company
(including without
limitation Section 6 and 7.7), which shall continue
to apply to Executive.
Section 409A
This Agreement is intended to comply with Code section
409A, or an exemption, and the provisions of this Subsection
apply notwithstanding any provisions of this Agreement
to the contrary. For purposes of
section 409A of the Code, the right
to a series of payments under this Agreement shall be treated
as a right to a series of separate payments and each payment
shall be treated as a separate payment. With
respect to any payments that are subject to section 409A of
the Code, in no event
shall Executive, directly or indirectly,
designate the calendar year of a payment and if a payment could
be made in more than
one taxable year, based on timing
of the execution of this Agreement, payment shall be made in the
later taxable year. Any
reimbursements and in-kind benefits provided under
this Agreement shall be made or provided in accordance with
requirements of section 409A of the Code.
Notwithstanding any provision of this Agreement to
the contrary, any payment
or benefit under this Agreement that
constitutes deferred compensation subject to section 409A
of the Code and for which the payment event is a Separation
Service shall not be made or provided before the date that
is six months after the date of Executive’s
Separation from Service.
Any payment or benefit that is delayed pursuant to this Subsection
shall be made or provided on the first business day of the
seventh month following the month in which Executive’s
Separation from Service occurs. With respect
to any cash payment
delayed pursuant to this Subsection, the first payment
shall include interest, at the Wall
Street Journal Prime Rate published
in the Wall Street
Journal on the date of Executive’s
Separation from Service (or the previous business day
if such date is not
a business day), for the period from the date the payment would
have been made but for this Subsection through the date
payment is made. The provisions of this Subsection shall
apply only to the extent required to avoid Executive’s
incurrence of
any additional tax or interest under section 409A of the
For purposes of this Subsection, a “
Separation from Service
shall mean Executive’s separation
from service with the Company and its affiliates within
the meaning of Treas. Reg.
§1.409A-1(h) or any successor thereto.
Agreement Severability
If any provision of this Agreement is construed to be invalid,
unlawful or unenforceable, then the
remaining provisions hereof shall not be affected
thereby and shall be enforceable without regard thereto.
and intending to be legally bound, the parties agree
to the terms of this Agreement.
Quaker Chemical
Date: 4/22/2021
/s/ Robert T. Traub
Robert T. Traub
Sr. VP,
General Counsel and Corporate Secretary
Date: 4/22/2021
/s/ Michael F. Barry
Michael F. Barry