{"id":39375,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/employment-agreement-minnesota-mining-and-manufacturing-co-and.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"employment-agreement-minnesota-mining-and-manufacturing-co-and","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/employment-agreement-minnesota-mining-and-manufacturing-co-and.html","title":{"rendered":"Employment Agreement &#8211; Minnesota Mining and Manufacturing Co. and W. James McNerney Jr."},"content":{"rendered":"<pre>\n                                EMPLOYMENT AGREEMENT\n                                      between\n                      Minnesota Mining and Manufacturing Company\n                                        and\n                               W. James McNerney, Jr.\n\n\n                            EMPLOYMENT AGREEMENT\n                                \n                                \nThis  EMPLOYMENT AGREEMENT (the \"Agreement\") dated as of December 4, 2000\n(the   \"Agreement  Date\")  between  Minnesota  Mining  and  Manufacturing\nCompany, a corporation incorporated under the laws of Delaware, with  its\ncorporate  headquarters  in  St.  Paul, Minnesota  (the  \"Company\"),  and\nW. James McNerney, Jr. (\"Executive\").\n\nWHEREAS,  the Company desires to employ Executive to serve as  its  Chief\nExecutive  Officer and Chairman of its Board, upon the terms and  subject\nto the conditions set forth herein;\n\nNOW,   THEREFORE,  in  consideration  of  the  premises  and  the  mutual\nagreements  contained herein, the Company and Executive hereby  agree  as\nfollows:\n\n                                   Article I.\n\n                                  DEFINITIONS\n\nThe  terms set forth below have the following meanings (such meanings  to\nbe  applicable  to  both  the  singular and plural  forms,  except  where\notherwise expressly indicated):\n\n1.1   \"Accrued Annual Bonus\" means the amount of any Annual Bonus  earned\nbut  not yet paid with respect to the Fiscal Year ended prior to the Date\nof Termination.\n\n1.2   \"Accrued Base Salary\" means the amount of Executive's  Base  Salary\nwhich is accrued but not yet paid as of the Date of Termination.\n\n1.3  \"Actual Company Pension Benefits\" means a single life annuity amount\ncommencing at age 62 and payable in monthly installments to Executive for\nhis  life  of the Actuarial Equivalent of the amounts that the  Executive\nhas  actually  received, or is entitled to receive,  from  the  Company's\nPension Plans.\n\n1.4  \"Actual Prior Employer Pension Benefits\" means a single life annuity\namount  commencing  at  age  62 and payable in  monthly  installments  to\nExecutive  for his life of the Actuarial Equivalent of the  amounts  that\nthe  Executive has actually received, or is entitled to receive, from the\nPrior Employer's Pension Plans.\n\n1.5   \"Actuarial  Equivalent\"  of  any  amount  shall  be  determined  in\naccordance  with generally accepted actuarial principles  using  interest\nrate,  mortality  and  other  methods and assumptions  that  the  Pension\nBenefit Guaranty Corporation (\"PBGC\") would use in determining the  value\nof an immediate annuity payment of benefits, or if such interest rate and\nmortality assumptions are no longer published by the PBGC, interest  rate\nand   mortality  assumptions  determined  in  a  manner  as  similar   as\npracticable to the manner by\n\n\n 58\nwhich the PBGC's interest rate and mortality assumptions were determined\nimmediately prior to the PBGC's cessation of publication of such assumptions.\n\n1.6   \"Affiliate\"  means  any Person directly or indirectly  controlling,\ncontrolled by, or under direct or indirect common control with,  Company.\nFor  the  purposes of this definition, the term \"control\" when used  with\nrespect to any Person means the power to direct or cause the direction of\nmanagement  or  policies of such Person, directly or indirectly,  whether\nthrough the ownership of voting securities, by contract or otherwise.\n\n1.7   \"Agreement\" -- see the recitals to this Agreement.\n\n1.8   \"Agreement Date\" means the date specified in the recitals  to  this\nAgreement.\n\n1.9   \"Anniversary Date\" means any annual anniversary of the Commencement\nDate.\n\n1.10 \"Annual Bonus\" -- see Section 4.2(a).\n\n1.11  \"Annualized Total Compensation\" means, as of any date, the  sum  of\nExecutive's  Base  Salary  as of such date and the  Target  Annual  Bonus\napplicable to the year that includes such date.\n\n1.12 \"Base Salary\" -- see Section 4.1.\n\n1.13 \"Beneficiary\" -- see Section 10.5.\n\n1.14 \"Board\" means the Company's Board of Directors.\n\n1.15 \"Cause\" means any of the following:\n\n      (a) Executive's conviction of:\n\n          (i)  a felony, or\n\n         (ii)  a  misdemeanor  excluding a petty  misdemeanor  (as\n               defined in Minnesota or a comparable misdemeanor  under\n               the laws of another state) involving fraud, dishonesty\n               or moral turpitude,\n\n      other  than  Limited  Vicarious  Liability  or  a  routine  traffic\nviolation,\n\n       (b)  Executive's material breach of this Agreement, provided  that\nsuch breach is not cured within 10 days after delivery to Executive of  a\nnotice from the Board requesting cure,\n\n       (c) the willful or intentional material misconduct by Executive in\nthe performance of his duties under this Agreement, or\n\n       (d)  the willful or intentional failure by Executive to materially\ncomply (to the best of his ability) with a specific, written direction of\nthe  Board  that  is  consistent with normal business  practice  and  not\ninconsistent   with  this  Agreement  and  Executive's   responsibilities\nhereunder, provided that such refusal or failure (i) is not cured to  the\nbest of Executive's ability within 10 days after the delivery thereof  to\nExecutive  and  (ii) is not based on Executive's good  faith  belief,  as\nexpressed by written notice to the Board given within such 10-day period,\nthat  the implementation of such direction of the Board would be unlawful\nor unethical.\n\nFor  purposes  of  the preceding sentence, \"Limited Vicarious  Liability\"\nshall mean any liability which is (i) based on acts of the Company for which\n\n\n 59\nExecutive is responsible solely as a result of his office(s)  with\nthe  Company  and (ii) provided that (x) he was not directly involved  in\nsuch  acts and either had no prior knowledge of such intended actions  or\npromptly  acted  reasonably and in good faith to attempt to  prevent  the\nacts causing such liability or (y) he did not have a reasonable basis  to\nbelieve that a law was being violated by such acts.\n\nFor purposes of clause (b) and (c) above, Cause shall not include any one\nor more of the following:\n\n(i)  bad judgment,\n\n(ii) negligence,\n\n(iii)  any act or omission that Executive believed in good faith to  have\nbeen in or not opposed to the interest of the Company (without intent  of\nExecutive to gain therefrom, directly or indirectly, a profit to which he\nwas not legally entitled), or\n\n(iv)      any act or omission of which any member of the Board who is not\na party to such act or omission has had actual knowledge for at least six\nmonths.\n\n1.16  \"Change of Control\" means any of the following events:\n\n  (a)  any  person (as such term is used in Rule 13d-5 under the Exchange\nAct)  or  group (as such term is defined in Sections 3(a)(9) and 13(d)(3)\nof  the  Exchange  Act), other than a Subsidiary or any employee  benefit\nplan  (or  any  related  trust) of Company or a Subsidiary,  becomes  the\nbeneficial owner of 20% or more of the Common Shares or of securities  of\nCompany  that are entitled to vote generally in the election of directors\nof Company (\"Voting Securities\") representing 20% or more of the combined\nvoting power of all Voting Securities of Company;\n\n (b) individuals who, as of the Agreement Date, constitute the Board (the\n\"Incumbent Directors\") cease for any reason to constitute at least 50% of\nthe  members  of the Board; provided that any individual  who  becomes  a\ndirector  after  the  Agreement Date whose  election  or  nomination  for\nelection  by  Company's shareholders was approved by a  majority  of  the\nmembers  of the Incumbent Board (other than an election or nomination  of\nan individual whose initial assumption of office is in connection with an\nactual  or threatened \"election contest\" relating to the election of  the\ndirectors  of  Company (as such terms are used in Rule 14a-11  under  the\nExchange  Act), \"tender offer\" (as such term is used in Section 14(d)  of\nthe  Exchange  Act)  or a proposed Merger (as defined  below))  shall  be\ndeemed to be members of the Incumbent Board;\n\n (c) approval by the stockholders of Company of either of the following:\n\n     (i)  a  merger, reorganization, consolidation or similar transaction\n(any  of  the foregoing, a \"Merger\") as a result of which the individuals\nand  entities who were the respective beneficial owners of Common  Shares\nand  Voting Securities of Company immediately before such Merger are  not\nexpected to beneficially own, immediately after such Merger, directly  or\nindirectly,  more  than 50% of, respectively, the common  stock  and  the\ncombined  voting  power  of  the  Voting Securities  of  the  corporation\nresulting  from  such  Merger in substantially the  same  proportions  as\nimmediately before such Merger, or\n\n    (ii) a plan of liquidation of Company or a plan or agreement for  the\nsale  or  other disposition of all or substantially all of the assets  of\nCompany,  other  than such a sale or disposition to an entity  which  is,\ndirectly or indirectly more than 50% owned by the Company or an entity of\nwhich  the  individuals  and entities who were the respective  beneficial\nowners  of  Common\n\n\n 60\nShares and Voting Securities of  Company  immediately\nbefore  such  sale  or other disposition beneficially  owned  immediately\nafter such sale or other disposition directly or indirectly more than 50%\nof,  respectively, the common stock and the combined voting power of  the\nVoting  Securities  of  the  corporation to  which  such  sale  or  other\ndisposition was made.\n\nNotwithstanding the foregoing, there shall not be a Change in Control if,\nin  advance  of such event, Executive agrees in writing that  such  event\nshall not constitute a Change in Control.\n\n1.17   \"Code\"  means the Internal Revenue Code of 1986, as  amended  from\ntime to time.\n\n1.18 \"Commencement Date\" means January 1, 2001.\n\n1.19 \"Committee\" means the Compensation Committee of the Board.\n\n1.20  \"Common Shares\" means the common shares, par value $0.01 per share,\nof Company.\n\n1.21 \"Company\" -- see the recitals to this Agreement.\n\n1.22 \"Competitor\" -- see Section 9.1(b).\n\n1.23 \"Confidential Information\" -- see Section 9.1(d).\n\n1.24  \"Date of Termination\" means the effective date of a Termination  of\nEmployment for any reason, including death or Disability, whether by  the\nCompany or by Executive.\n\n1.25 \"Disability\" means a mental or physical condition which, in the good\nfaith   opinion   of  the  Board,  renders  Executive,  with   reasonable\naccommodation,  unable  or  incompetent to carry  out  the  material  job\nresponsibilities  which Executive held or the material  duties  to  which\nExecutive was assigned at the time the disability was incurred, which has\nexisted for at least three months and which in the opinion of a physician\nmutually  agreed  upon  by Company and Executive (provided  that  neither\nparty  shall  unreasonably withhold such agreement)  is  expected  to  be\npermanent  or to last for an indefinite duration or a duration in  excess\nof six months.\n\n1.26 \"Employment Period\" -- see Section 3.1.\n\n1.27  \"Exchange Act\" means the United States Securities Exchange  Act  of\n1934.\n\n1.28 \"Executive\" -- see the recitals to this Agreement.\n\n1.29 \"Expiration Date\" -- see Section 3.1.\n\n1.30 \"Expiration Notice\" -- see Section 3.1.\n\n1.31  \"Fair  Market Value\" of a Common Share means, as of any  date,  the\naverage of the high and low prices of such security on such date reported\non the New York Stock Exchange Composite Transactions, rounded upwards to\nthe  nearest  $0.05,  or if not so reported for the specified  date,  the\nimmediately preceding date for which the average is reported.\n\n1.32  \"Fiscal  Year\" means the calendar year period ending each  December\n31.\n\"Good  Reason\"  means the occurrence of any one of the  following  events\nunless Executive specifically agrees in writing that such event shall not\nbe Good Reason:\n\n\n 61\n  (a) any material breach of the Agreement by the Company, including:\n\n    (i) the material failure of the Company to comply with the provisions\nof Articles II, III, IV, V, VI or VII of this Agreement;\n\n    (ii)  any material adverse change in the status, responsibilities  or\nperquisites of Executive;\n\n   (iii)  any  failure to nominate or elect Executive as Chief  Executive\nOfficer of the Company or as Chairman of the Company's Board;\n\n   (iv) causing or requiring Executive to report to anyone other than the\nBoard;\n\n     (v)  assignment of duties materially inconsistent with his positions\nand duties described in this Agreement; or\n\n   (vi) the Company giving an Expiration Notice pursuant to Section 3.1,\n\nprovided,  however,  that  no  act or omission  described  in  Subsection\n1.33(a)  shall constitute Good Reason unless Executive gives  Company  30\ndays'  prior written notice of such act or omission and the Company fails\nto  cure  such  act  or  omission within the 30-day period  (except  that\nExecutive  shall  not  be  required to provide such  notice  in  case  of\nintentional acts or omissions by the Company),\n\n  (b)  the failure of the Company to assign this Agreement to a successor\nto  the  Company or failure of a successor to the Company  to  explicitly\nassume and agree to be bound by the Agreement, or\n\n  (c) the requiring of Executive to be principally based at any office or\nlocation more than 30 miles from the current corporate offices of Company\nin St. Paul, Minnesota.\n\n1.34  \"Hypothetical  Prior  Employer Pension Benefits\"  means  a  benefit\npayable in the form of a single life annuity amount commencing at age  62\nand  payable in monthly installments to Executive for his life  equal  to\none-twelfth (1\/12th) multiplied by 50% of the Executive's highest average\nannual  compensation, where \"highest average annual compensation\" is  the\nannual  average of the Executive's compensation for the three consecutive\ncalendar  years out of the last ten calendar years preceding  Termination\nof  Employment during which such average is the highest.  For purposes of\ndetermining Executive's highest average annual compensation, compensation\npaid  to  Executive by the Company or the Prior Employer shall  be  taken\ninto  account to the same extent such compensation would have been  taken\ninto   account  for  purposes  of  such  determination  under  the  Prior\nEmployer's  Pension Plans if such compensation were with or paid  by  the\nPrior  Employer.   In  addition, solely for purposes of  calculating  the\nExecutive's  compensation for this purpose, in the event of a Termination\nWithout  Cause  or  a  Termination for Good Reason,  Executive  shall  be\ntreated as having earned the Severance Payment ratably over the course of\nthe Severance Period.\n\n1.35 \"Including\" means including without limitation.\n\n1.36 \"Incumbent Directors\" -- see Section 1.16(b).\n\n1.37 \"Initial Option\" -- see Section 5.1.\n\n1.38 \"Initial Performance Units\" -- see Section 5.5.\n\n1.39 \"Limited Vicarious Liability\" -- see Section 1.15.\n\n\n 62\n1.40 \"Make Whole Option\" -- see Section 5.1.\n\n1.41 \"Make Whole Restricted Stock\" -- see Section 5.8.\n\n1.42 \"Maximum Annual Bonus\" -- see Section 4.2(b).\n\n1.43 \"Maximum Annual Goals\" -- see Section 4.2(b).\n\n1.44 \"Merger\" -- see Section 1.16(c).\n\n1.45 \"Notice of Consideration\" -- see Section 8.1(b).\n\n1.46 \"Option\" means an option to purchase Common Shares.\n\n1.47 \"Option Term\" -- see Section 5.3(b).\n\n1.48 \"Other Accrued Benefit\" means any right to benefits or payments  not\nexpressly  provided  herein under the terms of the  governing  policy  or\nprogram which has irrevocably accrued as of the Date of Termination.\n\n1.49 \"PBGC\" -- see Section 1.5.\n\n1.50  \"Pension  Plan\" means a defined benefit plan which is  a  qualified\nretirement  plan  under Code Section 401(a) or a nonqualified  retirement\nplan or arrangement.\n\n1.51  \"Person\"  means  any individual, sole proprietorship,  partnership,\njoint   venture,   trust,   unincorporated   organization,   association,\ncorporation,   institution,  public  benefit   corporation,   entity   or\ngovernment instrumentality, division, agency, body or department.\n\n1.52 \"Prior Employer\" means General Electric Company.\n\n1.53 \"Pro Rata Annual Bonus\" means an amount payable in cash equal to the\nproduct  of (a) the amount of the Target Annual Bonus to which  Executive\nwould  have been entitled if he had been employed by the Company  on  the\nlast day of the Fiscal Year that includes the Date of Termination and  if\nExecutive  had  achieved his Target Annual Goals for  such  Fiscal  Year,\nmultiplied  by  (b) a fraction of which the numerator is the  numbers  of\ndays  which  have  elapsed  in  such Fiscal  Year  through  the  Date  of\nTermination and the denominator is 365.\n\n1.54 \"Pro Rata Retirement Benefit\" -- see Section 7.1(b).\n\n1.55  \"Severance  Multiple\"  means, if  Executive  receives  a  Severance\nPayment  under  Section  8.3, the number by which Executive's  Annualized\nTotal Compensation is multiplied under Section 8.3(b).\n\n1.56  \"Severance Payment\" means the payment of a multiple of  Executive's\nAnnualized Total Compensation pursuant to Section 8.3(b).\n\n1.57  \"Severance Period\" means the number of years equal to the Severance\nMultiple.\n\n1.58 \"Stock Ownership Program\" -- see Section 5.1.\n\n1.59 \"Subsequent Options\" -- see Section 5.2.\n\n1.60 \"Subsequent Performance Units\" -- see Section 5.7.\n\n\n 63\n1.61  \"Subsidiary\" means, with respect to any Person, (a) any corporation\nof  which  more than 50% of the outstanding capital stock having ordinary\nvoting  power  to  elect a majority of the board  of  directors  of  such\ncorporation  (irrespective of whether, at the time, stock  of  any  other\nclass  or  classes  of such corporation shall have or might  have  voting\npower  by  reason of the happening of any contingency) is  at  the  time,\ndirectly or indirectly, owned by such Person, and (b) any partnership  in\nwhich such Person has a direct or indirect interest (whether in the  form\nof  voting or participation in profits or capital contribution)  of  more\nthan 50%.\n\n1.62 \"Supplemental Retirement Benefit\" -- see Section 7.1.\n\n1.63 \"Target Annual Bonus\" -- see Section 4.2(b).\n\n1.64 \"Target Annual Goals\" -- see Section 4.2(b).\n\n1.65 \"Taxes\" means the incremental United States federal, state and local\nincome, excise and other taxes (including interest and penalties) payable\nby Executive with respect to any applicable item of income.\n\n1.66  \"Tax  Gross-Up Payment\" means an amount payable to  Executive  such\nthat  after  payment  of  Taxes on such amount there  remains  a  balance\nsufficient to pay the Taxes being reimbursed.\n\n1.67  \"Termination For Good Reason\" means a Termination of Employment  by\nExecutive  for  a  Good  Reason, whether during or after  the  Employment\nPeriod.\n\n1.68 \"Termination of Employment\" means a termination by the Company or by\nExecutive of Executive's employment by the Company.\n\n1.69  \"Termination Without Cause\" means a Termination  of  Employment  by\nCompany  for  any  reason  other  than  Cause  or  Executive's  death  or\nDisability, whether during or after the Employment Period.\n\n1.70 \"2001 Option\" -- see Section 5.2.\n\n1.71 \"Voting Securities\" -- see Section 1.16(a).\n\n1.72  \"Withholding Taxes\" means any federal, state, provincial, local  or\nforeign  withholding taxes and other deductions required to  be  paid  in\naccordance  with  applicable  law  by  reason  of  compensation  received\npursuant to this Agreement.\n\n1.73  \"Year of Service\" shall mean the 12-month period beginning  on  the\nCommencement Date and each 12-month period beginning on each  Anniversary\nDate  thereafter in which Executive remains continuously employed by  the\nCompany.   In  the event of a Termination Without Cause or a  Termination\nfor  Good  Reason  (whether  during  or  after  the  Employment  Period),\nExecutive  shall  also be credited with the number of  Years  of  Service\nequal to the Severance Period.\n\n\n                                  Article II.\n\n                                    DUTIES\n\n2.1   Duties.   The Company shall employ Executive during the  Employment\nPeriod as its Chief Executive Officer.  Executive shall also be nominated\nfor  election  as a director of the Company at the earliest  opportunity,\nand  upon such election the Board shall elect Executive to serve  as  its\nChairman  effective  January  1,  2001.  During  the  Employment  Period,\nexcluding  any  periods of disability, vacation, or sick leave  to  which\nExecutive  is  entitled,\n\n\n 64\nExecutive shall  perform  the  duties  properly\nassigned to him hereunder, shall devote substantially all of his business\ntime,  attention and effort to the affairs of the Company and  shall  use\nhis reasonable best efforts to promote the interests of the Company.\n\n2.2   Other  Activities.   Executive may serve  on  corporate,  civic  or\ncharitable  boards  or  committees, deliver  lectures,  fulfill  speaking\nengagements  or  teach at educational institutions,  or  manage  personal\ninvestments, provided that such activities do not individually or in  the\naggregate materially interfere with the performance of Executive's duties\nunder this Agreement.\n\n\n                          Article III.\n                                \n                        EMPLOYMENT PERIOD\n                                \n3.1    Employment   Period.    Subject  to  the  termination   provisions\nhereinafter  provided,  the  term of Executive's  employment  under  this\nAgreement (the \"Employment Period\") shall begin on the Commencement  Date\nand  end  on  the Anniversary Date which is three years after such  date,\nprovided  that  for  the  period  from  the  Agreement  Date  until   the\nCommencement Date, Executive shall be a part-time employee of the Company\nproviding the Company with such services as Executive determines  he  can\nprovide  consistent with Executive's obligations to the  Prior  Employer.\nNotwithstanding  the  preceding  sentence,  commencing   on   the   first\nAnniversary Date the Employment Period shall be extended each day by  one\nday  to  create a new two year term until, at any time at  or  after  the\nfirst  Anniversary Date, the Company or the Executive delivers a  written\nnotice  (an  \"Expiration Notice\") to the other party that  the  Agreement\nshall  expire  on  a  date  specified  in  the  Expiration  Notice   (the\n\"Expiration  Date\") that is not less than 24 months after  the  date  the\nExpiration  Notice  is delivered by one party to the  other  party.   The\nemployment of Executive by the Company shall not be terminated other than\nin accordance with Article VIII.\n\n\n                           Article 4.\n                                \n                          COMPENSATION\n                                \n4.1   Salary.   The  Company shall pay Executive in accordance  with  the\nnormal  payroll  practices of the Company (but not less  frequently  than\nmonthly)  an  annual  salary  at a rate of  $1,300,000  per  year  (\"Base\nSalary\")  beginning  on  the Commencement Date.   During  the  Employment\nPeriod,  the Base Salary shall be reviewed at least annually and  may  be\nincreased  from  time to time as shall be determined  by  the  Committee,\nafter consultation with Executive.  Any increase in Base Salary shall not\nlimit  or  reduce any other obligation of the Company to Executive  under\nthis Agreement.  Base Salary shall not be reduced at any time without the\nexpress written consent of Executive.\n\n4.2  Annual Bonus.\n\n    (a)  The  Company  shall pay to Executive an  annual  bonus  (\"Annual\nBonus\")  for each Fiscal Year which begins during the Employment  Period.\nExecutive shall be eligible for an Annual Bonus ranging from zero to  the\nMaximum  Annual Bonus. Except as noted below, the Annual Bonus  shall  be\npaid and otherwise subject to the terms of the Company's Executive Profit\nSharing Plan, as may be amended, and any successor to such plan.\n\n    (b)  If  Executive achieves his target performance goals (the \"Target\nAnnual  Goals\"), as determined by the Committee on an annual basis  after\nconsulting with Executive, such Annual Bonus shall be designed to realize\n$2,200,000 (the \"Target Annual Bonus\").  Such performance goals shall  be\nset by the Committee\n\n\n 65\nwithin 90 days after the first day of the applicable\nFiscal  Year.   The actual amount of any Annual Bonus may fluctuate  with\nthe Company's performance.\n    (c)  The  Company  shall pay the Annual Bonus in a payment  of  cash,\nCommon  Shares  (including restricted shares), or a  combination  thereof\ndetermined  by  the  Committee at such times and in  such  manner  as  is\nconsistent  with the treatment of other senior executives of the  Company\nand with the provisions of the Company's Executive Profit Sharing Plan or\nits successor plan.\n\n    (d)  Notwithstanding the above provisions of this  Section  4.2,  the\nminimum  Annual  Bonus for the 2001 Fiscal Year shall  be  $2,400,000  of\nwhich amount $1,440,000 shall be paid in cash and $960,000 shall be  paid\nin nonforfeitable unrestricted or restricted Common Shares.\n\n\n                           Article V.\n                                \n            STOCK GRANTS AND PERFORMANCE UNITS GRANTS\n                                \n5.1   Initial  and  Make  Whole Option Grants.  Company  has  granted  to\nExecutive,  effective  as of the Agreement Date, an  Option  to  purchase\n400,000  Common Shares (the \"Initial Option\") and an option  to  purchase\n200,000 Common Shares (\"Make Whole Option\"), subject to the terms of  the\nCompany's  1997  Management  Stock Ownership  Program  (\"Stock  Ownership\nProgram\").\n\n5.2   Subsequent  Option Grants.  In May 2001 the Committee  shall  grant\nExecutive  an  Option (\"2001 Option\") to purchase such number  of  Common\nShares as shall result in the 2001 Option having a Black-Scholes value of\n$7,000,000  as of the date of grant, subject to the terms and  conditions\nof  the  Stock Ownership Program.  The Committee shall in its  discretion\nconsider Executive for possible future annual or other grants of  Options\n(\"Subsequent  Options\")  for  Fiscal  Year  2002  and  each  Fiscal  Year\nthereafter  during the Employment Period, as determined by the  Committee\nin  its  discretion based on Executive's performance and consistent  with\nthe treatment of other senior executives of the Company.  Such Subsequent\nOptions  shall be subject to the terms of the Stock Ownership Program  or\napplicable successor program.\n\n5.3  Terms and Conditions of Options.\n\n   (a)  The exercise price of each Initial Option, Make Whole Option  and\n2001  Option, respectively, shall be the Fair Market Value  of  a  Common\nShare  as  of the Agreement Date (in the case of the Initial  Option  and\nMake  Whole Option) and as of the date of grant (in the case of the  2001\nOption).\n\n   (b)  Each Initial Option, Make Whole Option and 2001 Option (i)  shall\nhave a term (the \"Option Term\") equal to 10 years commencing on its grant\ndate,  and  (ii)  shall  not  be transferable  by  Executive  during  his\nlifetime, except as permitted by the Stock Ownership Program.\n\n  (c) The Initial Option shall become exercisable in increments of 20% on\neach of the first five Anniversary Dates, and the Make Whole Option shall\nbecome exercisable in increments of one-third on each of the first  three\nAnniversary  Dates,  if Executive remains continuously  employed  by  the\nCompany  from  the Commencement Date to each such applicable  Anniversary\nDate;  provided that such Options shall each become exercisable  in  full\nbefore  such applicable Anniversary Dates, immediately upon a Termination\nof  Employment  by  reason  of the death or Disability  of  Executive,  a\nTermination Without Cause, a Termination for Good Reason, or a Change  of\nControl.   The 2001 Option shall become exercisable at the time or  times\nspecified  by the Committee at the date of grant in accordance  with  the\nterms  and conditions of the Stock Ownership Program and consistent  with\nthe treatment of other senior executives of the Company.\n\n\n 66\n   (d)  Each  Initial Option, Make Whole Option and 2001  Option  may  be\nexercised after a Termination of Employment, to the extent exercisable as\nof  the  Date  of  Termination (whether by reason of the proviso  to  the\npreceding sentence or otherwise), as follows:\n\n    (i) in the event of a Termination of Employment by reason of death or\nDisability of Executive, until two years after the Date of Termination,\n\n    (ii) in the event of a Termination Without Cause or a Termination for\nGood Reason, until two years after the Date of Termination,\n\n  (iii) in the event of a Termination for Cause, such Option shall expire\non the Date of Termination, and\n\n    (iv) in the event of a Termination of Employment by Executive without\nGood  Reason  (other than as a result of death or Disability),  until  90\ndays after the Date of Termination,\n\nprovided, however, that in no event shall any Option be exercisable after\nthe expiration of the applicable Option Term.\n\n   (e)  Each  Subsequent  Option (other than the 2001  Option)  shall  be\nexercisable  at  times  and on terms and conditions  established  by  the\nCommittee  in  the  grant  of  such Subsequent  Option  under  the  Stock\nOwnership Program or applicable successor program.\n\n5.4   Manner of Exercise of Options.  An Option or any part thereof shall\nbe  exercised  by Executive or, if after his death, a Beneficiary,  by  a\nwritten  notice  to  Company stating the number  of  Common  Shares  with\nrespect  to  which  the  Option is being exercised  and  payment  of  the\nexercise price of the Option and any Withholding Taxes in connection with\nsuch  exercise  in  accordance  with  the  Stock  Ownership  Program   or\napplicable successor program.  Company shall deliver the purchased Common\nShares promptly after its receipt of notice of exercise and payment.\n\n5.5   Initial  Performance Units.  Company has granted to Executive  with\nrespect  to the performance period commencing January 1, 2001 and  ending\nDecember  31,  2003,  ten thousand (10,000) performance  units  (\"Initial\nPerformance  Units\"),  subject to the terms of the Company's  Performance\nUnit Plan.  The Initial Performance Units shall have a payment value  per\nunit  at  target equal to $100 per unit, a guaranteed minimum of  $100.00\nper  unit and a maximum of $200.00 per unit.  The unit value (subject  to\nthe  minimum  guaranteed value) shall depend upon  the  degree  to  which\nperformance goals are achieved over the performance period.\n\n5.6  Terms and Conditions of Initial Performance Units.\n\n   (a)  Except  as  provided in (b) below, the Initial Performance  Units\nshall  be  subject  in all respects to the terms and  conditions  of  the\nCompany's Performance Unit Plan, as amended from time to time.\n\n   (b)  The Executive shall vest in the Initial Performance Units at  the\nend  of  the initial performance period (December 31, 2003) if  Executive\nremains  continuously employed by the Company from the Commencement  Date\nto  the  end  of  the  initial  performance  period;  provided,  however,\nExecutive  shall  immediately become vested in  the  Initial  Performance\nUnits in the event of Executive's Termination of Employment by reason  of\ndeath or Disability, a Termination Without Cause, a Termination for  Good\nReason,  or  a  Change  of  Control prior  to  the  end  of  the  initial\nperformance period.  In the event of such accelerated vesting, the  value\nof  the  Initial Performance Units shall be an amount equal\n\n\n 67\nto the number\nof Initial Performance Units, valued at target, multiplied by a fraction,\nthe  numerator  of  which  is  the number  of  days  which  have  elapsed\ncommencing  January  1,  2001 and ending on the Date  of  Termination  or\nChange  of  Control and the denominator of which is the total  number  of\ndays from January 1, 2001 through December 31, 2003.\n\n5.7  Subsequent Performance Units.  The Committee shall in its discretion\nconsider  Executive  for  possible  future  annual  or  other  grants  of\nperformance units (\"Subsequent Performance Units\") during the  Employment\nPeriod,  as  determined  by the Committee in its  discretion  based  upon\nExecutive's performance and consistent with the treatment of other senior\nexecutives  of the Company.  Such Subsequent Performance Units  shall  be\nsubject to the terms of the Performance Unit Plan, as may be amended,  or\napplicable successor plan.\n\n\n5.8   Make  Whole Restricted Stock.  The Company has granted to Executive\n110,000  shares  of  Restricted  Stock (\"Make  Whole  Restricted  Stock\")\nsubject  to  the  terms of the Stock Ownership Program.  The  Make  Whole\nRestricted Stock grant shall become vested in increments of 10%  on  each\nof  the first ten Anniversary Dates if the Executive remains continuously\nemployed  by  the  Company  from  the  Commencement  Date  to  each  such\nAnniversary  Date;  provided, however, that upon  a  Termination  Without\nCause  or a Termination for Good Reason on or after the third Anniversary\nDate,  the  vesting percentage determined under the preceding  clause  of\nthis  sentence  shall be increased by 30 percentage points  (but  not  in\nexcess of 100%); provided, further, that upon a Termination Without Cause\nor a Termination for Good Reason prior to the third Anniversary Date, the\naggregate vesting percentage for the Make Whole Restricted Stock shall be\n50%;  and  provided,  further, that Executive  shall  immediately  become\nvested  in  all  of  the  Make Whole Restricted Stock  in  the  event  of\nExecutive's  Termination of Employment by reason of death or  Disability,\nor  a Change of Control.  Executive shall be paid in cash an amount equal\nto  the  dividends payable in respect of the Make Whole Restricted  Stock\n(whether  or not vested) as and when dividends are paid on Common  Shares\ngenerally.  If Executive has a Termination of Employment (other  than  by\nreason of death or Disability) prior to vesting in all of the Make  Whole\nRestricted Stock, the shares of Make Whole Restricted Stock which are not\nvested  as of the Date of Termination shall be forfeited (and the payment\nof  dividends in respect of such shares shall cease) unless the Committee\nin  its  sole  discretion determines to vest all or any  portion  of  the\nunvested shares.\n\n\n                           Article VI.\n                                \n                         OTHER BENEFITS\n                                \n6.1  Incentive, Savings and Retirement Plans.  In addition to Base Salary\nand  an  Annual Bonus, Executive shall be entitled to participate  during\nthe  Employment  Period in all incentive, savings and  retirement  plans,\npractices, policies and programs that are from time to time applicable to\nother senior executives of the Company in accordance with their terms  as\nin effect from time to time.\n\n6.2   Welfare  Benefits.  During the Employment Period, Executive  and\/or\nhis  family,  as the case may be, shall be eligible for participation  in\nand  shall  receive all benefits under welfare benefit plans,  practices,\npolicies  and  programs  provided  by  the  Company  (including  medical,\nprescription,  dental,  disability, salary  continuance,  employee  life,\ngroup   life,  dependent  life,  accidental  death  and  travel  accident\ninsurance  plans and programs) applicable to other senior  executives  of\nthe  Company  in accordance with their terms as in effect  from  time  to\ntime.\n\n\n 68\n6.3  Fringe Benefits.  During the Employment Period, Executive  shall  be\nentitled to fringe benefits applicable to other senior executives of  the\nCompany.\n\n6.4  Vacation.  During the Employment Period, Executive shall be entitled\nto  paid vacation time in accordance with the plans, practices, policies,\nand programs applicable to other senior executives of the Company, but in\nno  event  shall such vacation time be less than four weeks per  calendar\nyear.\n\n6.5  Expenses.  During the Employment Period, Executive shall be entitled\nto  receive  prompt  reimbursement for all reasonable  employment-related\nexpenses  incurred  by Executive upon the receipt by the  Company  of  an\naccounting   in  accordance  with  practices,  policies  and   procedures\napplicable to other senior executives of the Company.\n\n6.6   Office;  Support  Staff.  During the Employment  Period,  Executive\nshall  be entitled to an office or offices of a size and with furnishings\nand other appointments, and to personal secretarial and other assistance,\nappropriate to his position and duties under this Agreement.\n\n6.7  Tax Gross-Up Payment.  If it shall be determined that any payment to\nExecutive pursuant to this Agreement or any other payment or benefit from\nthe  Company, any Affiliate, or any other person would be subject to  the\nexcise tax imposed by Section 4999 of the Code or any similar tax payable\nunder  any  United  States  federal, state,  local  or  other  law,  then\nExecutive shall receive a Tax Gross-Up Payment with respect to  all  such\nexcise taxes and similar taxes.\n\n6.8   Relocation  Expenses.   Company shall  pay  Executive's  reasonable\nexpenses  related  to  the  relocation of his primary  residence  to  the\nMinneapolis  -  St.  Paul, Minnesota area, in accordance  with  Company's\nrelocation policy applicable to senior executives, including expenses  of\nperiodic  travel  between  Executive's  current  primary  residence   and\nMinneapolis-St.  Paul and reasonable temporary living  expenses  for  the\nExecutive  and  his family for a period not to exceed one year  from  the\nAgreement Date.  The relocation payments shall also include provision for\nthe  Company  to  purchase  Executive's current  principal  residence  as\nprovided  below.   If  any  payment of relocation  expenses  (other  than\npayments with respect to the purchase of Executive's principal residence)\nis  subject  to  Taxes, the Company shall pay Executive  a  Tax  Gross-Up\nPayment  with respect to such Taxes.  From the Commencement Date  through\nMarch  31,  2001,  the  Company  shall have  no  obligation  to  purchase\nExecutive's  current  principal  residence.   During  such  period,   the\nExecutive shall take such steps as are practicable to sell such residence\nat  then-prevailing  value.  In the event Executive  does  not  sell  his\ncurrent  principal residence on or prior to March 31, 2001,  as  soon  as\npracticable  after  such  date  the  Company  shall  purchase,  or  cause\nExecutive's  current principal residence to be purchased,  at  the  then-\nprevailing  value as determined by an appraiser mutually agreed  upon  by\nthe Company and the Executive for this purpose.  The purchase shall be on\nsuch  terms and conditions as are generally contained in transactions  of\nsuch nature.\n\n\n                          Article VII.\n                                \n                 SUPPLEMENTAL RETIREMENT BENEFIT\n                                \n7.1  Supplemental Retirement Benefit.  Executive shall be entitled to the\nfollowing  supplemental retirement benefit (the \"Supplemental  Retirement\nBenefit\") in accordance with the terms of this Article VII:\n\n\n 69\n  (a)  Upon Completion of 10 Years of Service.  Upon the completion of at\nleast  10  Years  of  Service,  Executive shall  receive  a  Supplemental\nRetirement Benefit equal to:\n      (i) the Hypothetical Prior Employer Pension Benefits,\n\nminus\n\n      (ii)  the sum of the Actual Prior Employer Pension Benefits, Actual\nCompany Pension Benefits, and benefits paid or payable to Executive under\nany  other employer's Pension Plan with respect to service prior  to  the\nCommencement Date.\n\nIf  the  remainder is zero or less, no amount shall be payable by Company\nhereunder.\n\n   (b) Upon Completion of Less Than 10 Years of Service.  Upon completion\nof  less  than  10 Years of Service, Executive shall receive  a  prorated\nSupplemental  Retirement  Benefit (the  \"Pro  Rata  Retirement  Benefit\")\ndetermined  by multiplying the Supplemental Retirement Benefit  described\nin  Section 7.1(a) above by a fraction (not to exceed 1.0), the numerator\nof  which is the number of Executive's whole and partial Years of Service\nas  of  the date of the Termination of Employment and the denominator  of\nwhich is 10.\n\n7.2   Payment.  Any benefits payable under this Article VII shall be paid\nas  of the Date of Termination or, if earlier, the first date of a Change\nof  Control in a lump sum equal to the Actuarial Equivalent present value\nof  an annuity described in Subsection 7.1(a) or (b) above.  In the event\nof a Termination of Employment by reason of Executive's death, the amount\nof  such  lump  sum payment to the Beneficiary shall equal the  lump  sum\npayment that would have been payable to Executive if he had been alive on\nthe  Date of Termination and had been fully vested as to the Supplemental\nRetirement  Benefit or, if applicable, Pro Rata Retirement Benefit.   The\nbenefit  may also be paid in the form of a commercially available annuity\nor life insurance contract that is mutually agreeable to the parties.\n\n7.3   Vesting.  Executive shall become fully vested in the benefits under\nthis  Article  VII on the fifth Anniversary Date provided  the  Executive\nremains  continuously employed by the Company from the Commencement  Date\nto  such fifth Anniversary Date, except that, in the event of Executive's\nTermination of Employment by reason of death or Disability, a Termination\nWithout  Cause,  a Termination for Good Reason, or a Change  of  Control,\nExecutive  shall immediately be vested as to such benefits.  If Executive\nshall  have  a  Termination of Employment for any other reason  prior  to\ncompletion  of  five Years of Service or prior to the  first  date  of  a\nChange  of  Control, Executive shall forfeit and shall  not  receive  any\nportion of the Supplemental Retirement Benefit.\n\n7.4   Other Retirement Benefits.  Executive shall participate in, and  be\nentitled  to  benefits under, any other retirement plans of  the  Company\nwhich  are not qualified under Section 401(a) of the Code, to the  extent\nprovided in such plan or arrangement.\n\n\n                          Article VIII.\n                                \n                      TERMINATION BENEFITS\n                                \n8.1  Termination for Cause or Other Than for Good Reason, etc.\n\n  (a) If Company terminates Executive's employment for Cause or Executive\nterminates  his  employment  other  than  for  Good  Reason,   death   or\nDisability,\n\n\n 70\nCompany shall pay to Executive immediately after the Date  of\nTermination  an  amount  equal  to the sum of  Executive's  Accrued  Base\nSalary,  Accrued Annual Bonus, and Other Accrued Benefits  and  Executive\nshall not be entitled to receive any Severance Payment.\n\n  (b) Company may not terminate Executive's employment for Cause unless:\n\n      (i) no fewer than 30 days prior to the Date of Termination, Company\nprovides Executive with written notice (the \"Notice of Consideration\") of\nits  intent to consider termination of Executive's employment for  Cause,\nincluding a detailed description of the specific reasons which  form  the\nbasis for such consideration;\n\n     (ii) after providing Notice of Consideration, the Board may, by  the\naffirmative vote of a majority of its members (excluding for this purpose\nExecutive if he is a member of the Board, any other management member  of\nthe  Board and any other member of the Board reasonably believed  by  the\nBoard   to   be  involved  in  the  events  leading  to  the  Notice   of\nConsideration),  suspend Executive with pay until a  final  determination\npursuant to this Section has been made;\n\n    (iii) on a date designated in the Notice of Consideration, which date\nshall  be at least 30 days following the date the Notice of Consideration\nis  provided, Executive shall have the opportunity to appear  before  the\nBoard, with or without legal representation, at Executive's election,  to\npresent arguments and evidence on his own behalf; and\n\n     (iv)  following the presentation to the Board as provided  in  (iii)\nabove  or Executive's failure to appear before the Board at the date  and\ntime  specified  in  the  Notice  of  Consideration,  Executive  may   be\nterminated  for Cause only if the Board, by the two-thirds  vote  of  its\nmembers  (excluding Executive if he is a member of the Board,  any  other\nmanagement  member  of  the  Board and any  other  member  of  the  Board\nreasonably believed by the Board to be involved in the events leading the\nBoard  to consider terminating Executive for Cause), determines that  the\nactions  or inactions of Executive specified in the Notice of Termination\noccurred,  that  such  actions or inactions constitute  Cause,  and  that\nExecutive's employment should accordingly be terminated for Cause.\n\n8.2   Termination for Death or Disability.  If, before  the  end  of  the\nEmployment Period, Executive's employment terminates due to his death  or\nDisability, Company shall pay to Executive or his Beneficiaries,  as  the\ncase may be, immediately after the Date of Termination an amount which is\nequal  to  the  sum  of Executive's Accrued Base Salary,  Accrued  Annual\nBonus, Pro Rata Annual Bonus, and Other Accrued Benefits.\n\n8.3   Termination Without Cause or for Good Reason.  In the  event  of  a\nTermination  Without  Cause or a Termination  for  Good  Reason  (whether\nduring  or after the Employment Period), subject to Section 8.5 Executive\nshall receive the following:\n\n   (a)  immediately after the Date of Termination, a lump sum cash amount\nin  immediately  available funds equal to the sum of Executive's  Accrued\nBase  Salary,  Accrued  Annual Bonus, Pro Rata Annual  Bonus,  and  Other\nAccrued Benefits;\n\n   (b)  immediately after the Date of Termination, a lump sum cash amount\nin  immediately  available  funds equal to three  (3)  times  Executive's\nAnnualized Total Compensation;\n\n   (c)  the  benefits (or, if such benefits are not available, the  value\nthereof)  specified in Section 6.2 to which Executive is entitled  as  of\nthe  Date  of\n\n\n 71\nTermination for the Severance Period, provided  that  such\nbenefits  shall  be  reduced  by  any  similar  benefits  provided  by  a\nsubsequent  employer;  provided further that  (i)  with  respect  to  any\nbenefit  to  be  provided on an insured basis, such value  shall  be  the\npresent value of the premiums expected to be paid for such coverage,  and\nwith respect to other benefits, such value shall be the present value  of\nthe expected net cost to Company of providing such benefits and (ii) from\nand after the Date of Termination, Executive shall not become entitled to\nany additional awards under Section 6.1 or any plans, practices, policies\nor programs of the Company; and\n\n   (d)  immediately after the Date of Termination, a lump-sum  amount  in\nimmediately  available  funds of any amount  then  payable  to  Executive\npursuant to Section 6.7.\n\n8.4   Other  Termination  Benefits  or  Remedies.   The  amounts  payable\nhereunder  are in lieu of any other termination or severance payments  or\nbenefits entitlement of Executive, including under any other programs  of\nthe  Company,  any Subsidiary or their Affiliates.  The  amounts  payable\nhereunder  shall  reduce  and be in full satisfaction  of  any  statutory\nentitlement  (including  notice  of  termination,  termination  pay   and\nseverance  pay) of Executive upon a Termination of Employment, and  shall\nconstitute  Executive's exclusive remedy for any damages  relating  to  a\nTermination of Employment for any reason.\n\n8.5   General  Release.  Executive's rights to payment under Section  8.3\nshall  be contingent upon the Executive's execution of a general  release\nof  any  and  all claims Executive may have, whether known or not  known,\nagainst  Company, the Subsidiaries, Affiliates and their past and present\ndirectors,  officers, and employees and agents, for events or  causes  of\naction occurring through the date of the release, including those arising\nfrom Executive's employment or Termination of Employment hereunder.   The\nrelease  shall be substantially the form attached hereto as Attachment  A\nas may be required by Company.\n\n\n                           Article IX\n                                \n                      RESTRICTIVE COVENANTS\n                                \n9.1  Non-Solicitation of Employees; Confidentiality; Non-Competition.\n\n(a) Executive covenants and agrees that, during the Employment Period and\nduring  the  one-year  period immediately following  any  Termination  of\nEmployment, Executive will not:\n\n    (i)  directly  or  indirectly employ or seek  to  employ  any  person\nemployed  at that time by Company or any of its Subsidiaries or otherwise\nencourage or entice any such person to leave such employment;\n\n   (ii)  become employed by, enter into a consulting arrangement with  or\notherwise agree to perform personal services for a Competitor (as defined\nin Section 9.1(b));\n\n (iii) acquire an ownership interest in a Competitor, other than not more\nthan a 2% equity interest in a publicly-traded Competitor; or\n\n  (iv) solicit any customers or vendors of Company or its Subsidiaries on\nbehalf of or for the benefit of a Competitor.\n\n(b)  For  purposes of this Section, \"Competitor\" means any  Person  which\nsells  goods  or services in the geographic area described  below,  which\ngoods  or  services  are the same or similar to (or  may  be  used  as  a\nsubstitute  therefore)  those  sold by  a  business  that  (i)  is  being\nconducted by Company or any\n\n\n 72\nSubsidiary in the geographic area at the time\nin  question and (ii) was being conducted by Company or any Subsidiary in\nthe geographic area on the date of Executive's Termination of Employment.\n\n(c)  Executive covenants and agrees that at no time during the Employment\nPeriod  nor  at  any  time following any Termination of  Employment  will\nExecutive communicate, furnish, divulge or disclose in any manner to  any\nPerson  any  Confidential  Information (as  defined  in  Section  9.1(d))\nwithout   the  prior  express  written  consent  of  Company.   After   a\nTermination of Employment, Executive shall not, without the prior written\nconsent  of the Company, or as may otherwise be required by law or  legal\nprocess,  communicate or divulge such Confidential Information to  anyone\nother than the Company and those designated by it.\n\n(d)  For purposes of this Section, \"Confidential Information\" shall  mean\nfinancial information about the Company, contract terms with vendors  and\nsuppliers, customer and supplier lists and data, trade secrets  and  such\nother  competitively-sensitive information to which Executive has  access\nas  a  result of his positions with the Company, except that Confidential\nInformation  shall  not  include any information  which  was  or  becomes\ngenerally  available  to the public (i) other  than  as  a  result  of  a\nwrongful  disclosure  by  Executive, (ii) as a result  of  disclosure  by\nExecutive  during the Employment Period which he reasonably and  in  good\nfaith  believes is required by the performance of his duties  under  this\nAgreement,  or  (iii)  any  information  compelled  to  be  disclosed  by\napplicable law or administrative regulation; provided that Executive,  to\nthe   extent  not  prohibited  from  doing  so  by  applicable   law   or\nadministrative  regulation,  shall give Company  written  notice  of  the\ninformation to be so disclosed pursuant to clause (iii) of this  sentence\nas far in advance of its disclosure as is practicable.\n\n9.2   Injunction.  Executive acknowledges that monetary damages will  not\nbe  an  adequate  remedy for Company in the event of  a  breach  of  this\nArticle  IX,  and  that  it would be impossible for  Company  to  measure\ndamages in the event of such a breach.  Therefore, Executive agrees that,\nin addition to other rights that Company may have, Company is entitled to\nan injunction preventing Executive from any breach of this Article IX.\n\n\n                           Article X.\n                                \n                          MISCELLANEOUS\n                                \n10.1  Public Announcement.  The Company shall give Executive a reasonable\nopportunity  to review and comment on any public announcement  (including\nany filing with a governmental agency or stock exchange) relating to this\nAgreement or Executive's employment by the Company.\n\n10.2 Approvals.  The Company represents and warrants to Executive it  has\ntaken all corporate action necessary to authorize this Agreement.\n\n10.3  No  Mitigation.  In no event shall Executive be obligated  to  seek\nother employment or take any other action to mitigate the amounts payable\nto Executive under any of the provisions of this Agreement, nor shall the\namount of any payment hereunder be reduced by any compensation earned  as\nresult  of  Executive's employment by another employer, except  that  any\ncontinued welfare benefits provided for by Section 6.2 and 8.3 shall  not\nduplicate  any benefits that are provided to Executive and his family  by\nsuch  other  employer and shall be secondary to any coverage provided  by\nsuch other employer to the extent permitted by law.\n\n\n 73\n10.4  Enforcement.  If Executive and the Company have a dispute regarding\nExecutive's   entitlement  to  compensation  and  benefits   under   this\nAgreement,  and if Executive shall prevail in such dispute,  the  Company\nshall  reimburse  Executive's reasonable legal fees  and  other  expenses\nincurred in such effort.\n\n10.5  Beneficiary.   If  Executive dies prior to  receiving  all  of  the\namounts  payable  to him in accordance with the terms and  conditions  of\nthis   Agreement,   such  amounts  shall  be  paid  to  the   beneficiary\n(\"Beneficiary\") designated by Executive in writing to Company during  his\nlifetime, or if no such Beneficiary is designated, to Executive's estate.\nSuch  payments shall be made in a lump sum to the extent so payable  and,\nto  the extent not payable in a lump sum, in accordance with the terms of\nthis Agreement.  Executive, without the consent of any prior Beneficiary,\nmay change his designation of Beneficiary or Beneficiaries at any time or\nfrom  time  to  time  by  a submitting to Company a  new  designation  in\nwriting.  Notwithstanding the preceding provisions of this Section  10.5,\nwith  respect  to  the  Stock Ownership Program, the Company's  Executive\nProfit  Sharing  Plan  or Performance Unit Plan, the  term  \"Beneficiary\"\nshall have the meanings set forth therein.\n\n10.6  Assignment;  Successors.  Company may not  assign  its  rights  and\nobligations  under  this Agreement without the prior written  consent  of\nExecutive  except to a successor of Company's business.   This  Agreement\nshall  be binding upon and inure to the benefit of Executive, his  estate\nand  Beneficiaries, the Company and the successors and permitted  assigns\nof the Company.\n\n10.7  Nonalienation.  Except as is otherwise expressly  provided  herein,\nbenefits payable under this Agreement shall not be subject in any  manner\nto   anticipation,   alienation,  sale,  transfer,  assignment,   pledge,\nencumbrance,  charge, garnishment, execution or levy of any kind,  either\nvoluntary  or involuntary, prior to actually being received by Executive,\nand  any  such  attempt  to  dispose of any  right  to  benefits  payable\nhereunder shall be void.\n\n10.8  Severability.  If all or any part of this Agreement is declared  by\nany  court  or  governmental authority to be unlawful  or  invalid,  such\nunlawfulness or invalidity shall not serve to invalidate any  portion  of\nthis Agreement not declared to be unlawful or invalid.  Any provision  so\ndeclared to be unlawful or invalid shall, if possible, be construed in  a\nmanner  which  will  give effect to the terms of such  provision  to  the\nfullest extent possible while remaining lawful and valid.\n\n10.9  Amendment; Waiver.  This Agreement shall not be amended or modified\nexcept  by written instrument executed by the parties.  A waiver  of  any\nterm,  covenant  or condition contained in this Agreement  shall  not  be\ndeemed  a waiver of any other term, covenant or condition, and any waiver\nof  any  default  in any such term, covenant or condition  shall  not  be\ndeemed  a  waiver  of  any later default thereof or of  any  other  term,\ncovenant or condition.\n\n10.10  Notices.  All notices hereunder shall be in writing and  delivered\nby  hand,  by  nationally-recognized  delivery  service  that  guarantees\novernight  delivery,  or by first-class, registered  or  certified  mail,\nreturn receipt requested, postage prepaid, addressed as follows:\nIf to Company, to:  Minnesota Mining and Manufacturing Company\n                    3M Center\n                    St. Paul, MN 55144\n                    Attention: General Counsel\n\nWith copy to:       Roger C. Siske\n                    Sonnenschein Nath &amp; Rosenthal\n                    8000 Sears Tower\n                    Chicago, IL 60606\n\n\n 74\nIf to Executive, to:    James McNerney\n                        At the most recent home address on file with\n                        the Company\n\n     With copy to:  Robert Stucker\n                    Vedder Price Kaufman &amp; Kammholz\n                    222 North La Salle Street\n                    Chicago, Illinois 60601-1003\n\nEither  party  may  from time to time designate a new address  by  notice\ngiven  in  accordance with this Section.  Notice shall be effective  when\nactually received by the addressee.\n\n10.11  Currency.   All  monetary amounts stated  in  this  Agreement  are\nexpressed in, and shall be payable in, United States dollars.\n\n10.12   Counterparts.   This  Agreement  may  be  executed   in   several\ncounterparts, each of which shall be deemed to be an original but all  of\nwhich together will constitute one and the same instrument.\n\n10.13  Entire  Agreement.   This Agreement  forms  the  entire  agreement\nbetween the parties hereto with respect to any severance payment and with\nrespect  to  the  subject  matter contained in the  Agreement  and  shall\nsupersede  all  prior agreements, promises and representations  regarding\nemployment,  compensation, severance or other  payments  contingent  upon\ntermination of employment, whether in writing or otherwise.\n\n10.14  Applicable Law.  This Agreement shall be interpreted and construed\nin  accordance with the laws of the State of Delaware, without regard  to\nits choice of law principles.\n\n10.15 Survival of Executive's Rights and Obligations.  All of Executive's\nrights hereunder, including his rights to compensation and benefits,  and\nhis obligations under Article IX hereof, shall survive the termination of\nExecutive's employment and\/or the termination of this Agreement.\n\n10.16  Indemnification.  Executive shall be indemnified  by  the  Company\nagainst  liability  as an officer and director of  the  Company  and  any\nSubsidiary or Affiliate of the Company to the maximum extent permitted by\napplicable  law.  The Executive's rights under this Section  10.16  shall\ncontinue  so long as Executive may be subject to such liability,  whether\nor not this Agreement may have terminated prior thereto.\n\nIN WITNESS WHEREOF, the parties have executed this Agreement on the dates\nwritten below.\n\nMinnesota Mining and Manufacturing Company\n\nBy: \/s\/ Edward A. Brennan\nIts: Director\nDate: _____________________________\n\nEXECUTIVE\n\/s\/ W. James McNerney, Jr.\nW. James McNerney, Jr.\nDate: _____________________________\n\n\n 75\nATTACHMENT A\n\n\nRELEASE\n\n      This RELEASE (\"Release\") dated as of this ____________________  day\nbetween   Minnesota  Mining  and  Manufacturing  Company,  a  corporation\nincorporated  under  the  laws  of Delaware  (\"Company\"),  and  W.  James\nMcNerney, Jr. (\"Executive\").\n\n      WHEREAS, the Company and the Executive previously entered  into  an\nEmployment  Agreement dated December 4, 2000 under  which  Executive  was\nemployed to serve as the Company's Chief Executive Officer;\n\n      WHEREAS,  the  Executive's employment with the Company  (has  been)\n(will be) terminated effective __________________; and\n\n      WHEREAS,  pursuant  to  Section 8.3 of  the  Employment  Agreement,\nExecutive  is  entitled to certain compensation and  benefits  upon  such\ntermination, contingent upon the execution of this Release.\n\n      NOW,  THEREFORE,  in  consideration  of  the  premises  and  mutual\nagreements contained herein and in the Employment Agreement, the  Company\nand Executive agree as follows:\n\n     1.   Executive, on his own behalf and on behalf of his heirs, estate\nand  beneficiaries,  does  hereby release the Company,  and  any  of  its\nSubsidiaries  or Affiliates (as such terms are defined in the  Employment\nAgreement), and each past or present officer, director, agent,  employee,\nshareholder,  and insurer of any such entities, from any and  all  claims\nmade,  to  be  made,  or which might have been made of  whatever  nature,\nwhether  known  or unknown, from the beginning of time,  including  those\nthat arose as a consequence of his employment by Company, or arising  out\nof  the severance of such employment relationship, or arising out of  any\nact committed or omitted during or after the existence of such employment\nrelationship, all up through and including the date on which this Release\nis  executed, including, but not limited to, those which were, could have\nbeen  or could be the subject of an administrative or judicial proceeding\nfiled  by  Executive or on his behalf under federal, state or local  law,\nwhether  by statute, regulation, in contract or tort, and including,  but\nnot limited to, every claim for front pay, back pay, wages, bonus, fringe\nbenefit, any form of discrimination (including but not limited to,  every\nclaim  of race, color, sex, religion, national origin, disability or  age\ndiscrimination),  wrongful  termination,  emotional  distress,  pain  and\nsuffering,   breach  of  contract,  compensatory  or  punitive   damages,\ninterest,  attorney's fees, reinstatement or reemployment. If  any  court\nrules  that  such waiver of rights to file, or have filed on his  behalf,\nany  administrative  or  judicial charges or complaints  is  ineffective,\nExecutive  agrees not to seek or accept any money damages  or  any  other\nrelief upon the filing of any such administrative or judicial charges  or\ncomplaints.  Executive  relinquishes any right to  future  employment  by\nCompany and Company shall have the right to refuse to re-employ Executive\nwithout  liability. Executive acknowledges and agrees  that  even  though\nclaims  and facts in addition to those now known or believed  by  him  to\nexist may subsequently be discovered, it is his intention to fully settle\nand  release  all claims he may have against the Company and the  persons\nand entities described above, whether known, unknown or suspected.\n\n\n 76\n      2.    The  Company  and Executive acknowledge and  agree  that  the\nrelease contained in Paragraph 1 does not, and shall not be construed to,\nrelease or limit the scope of any existing obligation of Company  (i)  to\nindemnify Executive for his acts as an officer or director of Company  in\naccordance with the bylaws of Company and the policies and procedures  of\nCompany  that  are  presently in effect including Section  10.16  of  the\nEmployment   Agreement,   or  (ii)  to  Executive   and   his   eligible,\nparticipating  dependents  or  beneficiaries  under  any  existing  group\nwelfare  or  retirement  plan of Company in which Executive  and\/or  such\ndependents are participants.\n\n[Applicable Required ADEA waiver provisions to be inserted]\n\n      IN  WITNESS WHEREOF, the parties have executed this Release on  the\ndate first above written.\n\nEXECUTIVE\n__________________________________\nW. James McNerney, Jr.\n\nMinnesota Mining and Manufacturing Company\nBy:\nIts:\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8235],"corporate_contracts_industries":[9452],"corporate_contracts_types":[9539,9544],"class_list":["post-39375","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-minnesota-mining---mfg-co","corporate_contracts_industries-manufacturing__conglomerates","corporate_contracts_types-compensation","corporate_contracts_types-compensation__employment"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/39375","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=39375"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=39375"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=39375"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=39375"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}