EX-10.26 2 0002.txt LETTER AGREEMENT DATED OCTOBER 18, 2000 EXHIBIT 10.26 -------------------------------------------------------------------------------- Lars Nyberg 1700 South Patterson Boulevard Chairman and CEO Dayton, Ohio 45479 October 18, 2000 Mr. Mohsen Sohi 29279 Hampshire Place Westlake, Ohio 44145 Dear Mohsen: I am delighted to extend to you an offer of employment with NCR Corporation as Senior Vice President of the Retail Solutions Group. As you know, this offer is contingent on the approval of NCR Board of Directors. In this position, you will report directly to Bill Amelio, Chief Operating Officer of the Retail/Financial Group. We'll need to discuss a mutually agreeable start date. Other details of your offer are as follows. Annual Base Salary - Your base salary will be $375,000, commencing as of ------------------ your effective start date. You will be paid on a bi-weekly pay schedule, one week in arrears. Your paycheck will be automatically deposited in the bank of your choice via our convenient Easipay plan. Sign-On Bonus - You will be extended a $100,000 gross sign-on bonus within ------------- thirty days of your effective start date. All applicable taxes will be withheld from this award. Your sign-on bonus will not be treated as compensation for purposes of determining employee pensions and benefits. Incentive Award - You will be eligible to participate in the Management --------------- Incentive Plan for Executive Officers (MIP), which provides year-end incentive awards based on the success of NCR in meeting annual performance objectives. For your position, the targeted incentive opportunity is 60% of your salary ($225,000) and the maximum award is 120% ($450,000) of your salary. Given the fact that you will forfeit your 2000 bonus at your current company, NCR will guarantee an incentive award of $215,000 for 2000. This will be paid within thirty days of your effective start date For 2001, compensation objectives are yet to be established, but will probably include revenue growth, profit and asset management measures. Equity ------ Stock Options- You will receive an initial stock option grant, as of your effective start date, for 130,000 shares of NCR common stock. The grant price will be determined by the fair market value of the average of the high and low share price of the Company's common stock on your first date of employment. These options will be subject to terms and conditions determined by the NCR Board of Directors. These stock options include a non-competition provision, have a ten-year term, and vest as follows: Initial Vesting Date - 1 year anniversary of start date - 1/3 of the grant Next Vesting Date - 2 year anniversary of start date - 1/3 of the grant Final Vesting Date - 3 year anniversary of start date - 1/3 of the grant Note that the grant above includes your 2001 management stock option grant which is typically awarded to NCR management in Q1, 2001. Restricted Stock - You will receive a special restricted stock grant, as of your first date of employment, for 25,000 shares of NCR common stock. These shares will be set up in a record account in your name with NCR's Transfer Agent and Stock Registrar (American Stock Transfer), and will vest (become transferable) as follows: Initial Vesting Date - January 1, 2002 - 60% of the grant Final Vesting Date - January 1, 2003 - 40% of the grant Incentives in General - For an officer in your position, short and long- --------------------- term incentives at NCR currently take the form of the MIP and stock options. Since these incentives are designed to address the conditions of an ever-changing marketplace, NCR cannot make any definitive representations concerning the continuation of either program or the size of the individual awards. 41 Vacation - In recognition of your prior work experience, you will be -------- eligible for four weeks of paid vacation. NCR Benefits - On your first day of employment with NCR, the company ------------ provides you and your eligible dependents with the following core benefit coverage: NCR Health Care Coverage NCR Dental Care Coverage Short-Term and Long-Term Disability Coverages Life Insurance Coverage Accidental Death and Dismemberment Insurance Coverage As a new employee of NCR, you have the opportunity to design your own personalized benefit program through Personal Choice, the company's flexible benefits program. After your employment commences, you will receive the NCR Benefits Information Package, and a Benefit representative will meet with you to guide you through any questions you may have. Additionally, you will be eligible to participate in the NCR Pension Plan, the NCR Savings Plan (401k), and the NCR Stock Purchase Plan. The attached Benefits Overview provides more information about NCR benefits. Retirement - In addition to your participation in the NCR Pension Plan ---------- (qualified plan), you will also participate in the following nonqualified pension plans: The Retirement Plan for Officers of NCR Corporation (SERP II) - The plan, which is described in more detail in the attached summary, provides a career average pension of 2.5% of the total of your base salary and MIP award, times your years of service as an Officer and less pension accrued as an Officer in other NCR sponsored plans. While this plan currently vests after ten years of officer service, NCR plans to recommend to the Compensation Committee of the Board of Directors that the vesting take place after five years, which is more in line with competitive analogs and mirrors the qualified pension plan vesting pertaining to all employees. However, there can be no assurance that this proposed change will be adopted. The NCR Mid-Career Hire Supplemental Pension Plan - This plan, described in more detail in the attached summary, provides a pension supplement to make up for lost pension that could result from not having a "full career" with one company. This pension supplement is in addition to the SERP II benefit. Financial Counseling - You will be eligible to participate in a financial -------------------- counseling program provided through one of three consulting firms designated by the Company. The Company will pay up to $8,000 annually for financial planning, estate planning and tax preparation plus a gross-up for the tax impact of this service. Further information on this program will be provided separately. Relocation - You will be eligible for relocation benefits under NCR's ---------- Relocation Policy with two notable exceptions described below. 1) With respect to the money you have put down on a house in California, NCR will cover up to a maximum of $20,000 gross if you cannot get your money back. We understand the risk of you not receiving your down payment back is low, but are willing to provide you this "safety net" given proof of your loss. 2) With respect to the sale of your current house in Westlake, Ohio, NCR's relocation policy provides a "third-party buy-out process" that provides up to a $15,000 gross payment in the event of a qualifying loss on sale. Given your circumstances, NCR will provide up to a $50,000 gross payment in the event of a loss on the sale of your home. Change in Control - You will participate in NCR's current Change in Control ----------------- Severance Plan for Executive Officers. In the event of a qualified Change- In-Control (as defined in this Plan), you will receive three times your base salary and targeted bonus plus immediate vesting of your NCR stock options and restricted stock. Special Severance - In the event of a Company initiated termination other ----------------- than for "cause" (defined in the same manner as in the NCR Change-in- Control Severance Plan for Executive Officers), you will receive a cash payment of one times your annual base salary and immediate vesting of your NCR restricted stock. This letter reflects the entire agreement regarding the terms and conditions of your employment. Accordingly, it supersedes and completely replaces any prior oral or written communication on this subject. This letter is not an employment contract and should not be construed or interpreted as containing any guarantee of continued employment. The employment relationship at NCR is by mutual consent ("Employment-At-Will"). This means that managers have the right to terminate their employment at any time and for any reason. Likewise, the Company reserves the right to discontinue your employment with or without cause at any time and for any reason. 42 Mohsen, we are enthusiastic about the contributions, experience and vision you can bring to NCR. The company is positioned well in our market to be exceedingly successful and I personally would like to extend this opportunity for you to be a part of my senior management team. If you have any questions concerning the details of the appointment, please feel free to contact Wilbert Buiter or me. Sincerely, /s/LarsNyberg Lars Nyberg /s/ Mohsen Sohi October 30, 2000 ---------------------------- ---------------- Agreed and Accepted Date Mohsen Sohi pc: W. Buiter W. Amelio Attachments: Benefits Overview Summary of SERP II Summary of Mid-Career Hire Plan NCR Relocation Policy 43