NASHUA CORPORATION LETTERHEAD] April 12, 2007
Exhibit 10.1
[NASHUA CORPORATION LETTERHEAD]
April 12, 2007
VIA FEDERAL EXPRESS
Xx. Xxxxx XxXxxxxxx
0 XxxxXxxx Xxxxxxx
Xxxxxxxx, XX 00000
0 XxxxXxxx Xxxxxxx
Xxxxxxxx, XX 00000
Dear Xxxxx:
As we have discussed, your employment with Nashua Corporation (the “Company”) will end on
March 16, 2007. As set forth in the Change of Control and Severance Agreement between you and the
Company dated January 5, 2005, you are eligible to receive the severance benefits described in the
“Description of Severance Benefits” attached to this letter agreement as Attachment A if you sign
and return this letter agreement to Xxxxxxx Xxxxxx by May 7, 2007 and it becomes binding between
you and the Company. By signing and returning this letter agreement and not revoking your
acceptance, you will be agreeing to the terms and conditions set forth in the numbered paragraphs
below, including the release of claims set forth in paragraph 3. Therefore, you are advised to
consult with an attorney before signing this letter agreement and you may take up to twenty-one
(21) days to do so. If you sign this letter agreement, you may change your mind and revoke your
agreement during the seven (7) day period after you have signed it by notifying Xxxxxxx Xxxxxx in
writing. If you do not so revoke, this letter agreement will become a binding agreement between
you and the Company upon the expiration of the seven (7) day period.
If you choose not to sign and return this letter agreement by May 7, 2007, or if you timely
revoke your acceptance in writing, you shall not receive any severance benefits from the Company.
You will, however, receive payment for any unused paid time off accrued through the Termination
Date (as defined herein) within two weeks from your Termination Date, or if you have used more paid
time off than accrued through your termination date, you may owe the Company for those hours/days
and your final pay will be adjusted accordingly or arrangements will be made with you to reimburse
the Company. Also, regardless of signing this letter agreement, you may elect to continue
receiving group medical insurance pursuant to the federal “COBRA” law, 29 U.S.C. § 1161 et
seq. All premium costs for “COBRA” shall be paid by you on a monthly basis for as long as, and
to the extent that, you remain eligible for COBRA continuation. You should consult the COBRA
materials to be provided by the Company for details regarding these benefits. All other benefits,
including life insurance and long-term disability, will cease upon your Termination Date. You will
have a thirty-one (31) day period to
convert from the term life insurance group coverage to private whole life coverage at standard
rates, with no physical examination required. If you wish to apply for this coverage, attached is
the conversion application and you may calculate the premium for the amount selected. You will
then mail the application along with your premium payment to the address on page 3 of the
information packet, within thirty-one (31) days from your Termination Date. If you wish to convert
your Long Term Disability Insurance to individual coverage, a packet is attached for you to review.
You would need to review the packet, complete the application, and mail the enrollment form to the
address on page 6 after your termination. Additionally, pursuant to the Company’s Amended 1996
Stock Incentive Plan and 1999 Shareholder Value Plan, you have six (6) months from the Termination
Date to exercise any vested stock rights you may have. All unvested stock rights will be cancelled
on the Termination Date.
The following numbered paragraphs set forth the terms and conditions that will apply if you
timely sign and return this letter agreement and do not revoke it in writing within the seven (7)
day period:
1. Termination Date — Your effective date of termination from the Company is March 16,
2007 (the “Termination Date”).
2. Description of Severance Benefits — The severance benefits paid to you if you
timely sign, return, and do not revoke this letter agreement are described in the “Description of
Severance Benefits” attached as Attachment A (the “severance benefits”).
3. Release — In consideration of the payment of the severance benefits, which you
acknowledge you would not otherwise be entitled to receive, you hereby fully, forever, irrevocably
and unconditionally release, remise and discharge the Company, its officers, directors,
stockholders, corporate affiliates, subsidiaries, parent companies, agents and employees (each in
their individual and corporate capacities) (hereinafter, the “Released Parties”) from any and all
claims, charges, complaints, demands, actions, causes of action, suits, rights, debts, sums of
money, costs, accounts, reckonings, covenants, contracts, agreements, promises, doings, omissions,
damages, executions, obligations, liabilities, and expenses (including attorneys’ fees and costs),
of every kind and nature that you ever had or now have against the Released Parties, including, but
not limited to, any and all claims arising out of or relating to your employment with and/or
separation from the Company, including, but not limited to, all employment discrimination claims
under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., the Age
Discrimination in Employment Act, 29 U.S.C. § 621 et seq., the Americans With
Disabilities Act of 1990, 42 U.S.C. § 12101 et seq., the Family and Medical Leave
Act, 29 U.S.C. § 2601 et seq., the Worker Adjustment and Retraining Notification
Act (“WARN”), 29 U.S.C. § 2101 et seq., Section 806 of the Corporate and Criminal
Fraud Accountability Act of 2002, 18 U.S.C. 1514(A), and the Rehabilitation Act of 1973, 29 U.S.C.
§ 701 et seq., Executive Order 11246, Executive Order 11141, all as amended; all
claims arising out of the Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq., the Employee
Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq., the New
Hampshire Law Against Discrimination, N.H. Rev. Stat. Xxx. §31-354-A:1 et seq., the New Hampshire
Equal Pay Law, N.H. Rev. Stat. Xxx. §275:36 et seq., the Massachusetts Fair Employment Practices
Act., M.G.L. c. 151B, § 1 et seq., the Massachusetts Civil Rights Act, M.G.L. c. 12, §§ 11H
and 11I, the Massachusetts Equal Rights Act, M.G.L. c. 93, § 102 and M.G.L. c. 214, § 1C, the
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Massachusetts Labor and Industries Act, M.G.L. c. 149, §
1 et seq., the Massachusetts
Privacy Act, M.G.L. c. 214, § 1B, and the Massachusetts Maternity Leave Act, M.G.L. c. 149, § 105D,
all as amended; all common law claims including, but not limited to, actions in tort, defamation
and breach of contract; all claims to any non-vested ownership interest in the Company, contractual
or otherwise, including but not limited to claims to stock or stock options; and any claim or
damage arising out of your employment with or separation from the Company (including a claim for
retaliation) under any common law theory or any federal, state or local statute or ordinance not
expressly referenced above; provided, however, that nothing in this Agreement prevents you from
filing, cooperating with, or participating in any proceeding before the EEOC or a state Fair
Employment Practices Agency (except that you acknowledge that you may not be able to recover any
monetary benefits in connection with any such claim, charge or proceeding); provided, further that
nothing herein shall release the Company from your Stock Option Agreements.
The Company hereby fully, forever, irrevocably and unconditionally releases, remises and
discharges you from any and all claims which it ever had or now has against you, other than for
intentional harmful acts.
4. Confidentiality and Other Obligations — You acknowledge and reaffirm your
confidentiality obligations as stated in Section 13 of the Change of Control and Severance
Agreement between you and the Company dated January 5, 2005, which provision remains in full force
and effect; and you acknowledge and reaffirm your obligations as stated in any confidentiality,
non-competition, return of property and developments agreements that you have executed, which also
remain in full force and effect.
5. Return of Company Property — You confirm that you have returned to the Company all
keys, files, records (and copies thereof), equipment (including, but not limited to, computer
hardware, software and printers, wireless handheld devices, cellular phones, pagers, etc.), Company
identification and any other Company-owned property in your possession or control and have left
intact all electronic Company documents, including but not limited to those which you developed or
helped to develop during your employment. You further confirm that you have cancelled all accounts
for your benefit, if any, in the Company’s name, including but not limited to, credit cards,
telephone charge cards, cellular phone and/or pager accounts and computer accounts.
6. Business Expenses and Compensation — You acknowledge that you have been reimbursed
by the Company for all business expenses incurred in conjunction with the performance of your
employment and that no other reimbursements are owed to you. You further acknowledge that you have
received payment in full for all services rendered in conjunction with your employment by the
Company and that no other compensation is owed to you.
7. Non-Disparagement — You understand and agree that as a condition for payment to you of the
consideration herein described, you shall not make any false, disparaging or derogatory statements
to any person or entity, including any media outlet, regarding the Company or any of its directors,
officers, employees, agents or representatives or about the Company’s business affairs and
financial condition. The Company will instruct me not to make
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any false, disparaging or derogatory statements to any person or entity, including any media
outlet, regarding you.
8. Cooperation — You agree to cooperate fully with the Company in the defense or
prosecution of any claims or actions now in existence or which may be brought in the future against
or on behalf of the Company. Your full cooperation in connection with such claims or actions shall
include, but not be limited to, your being available to meet with Company counsel to prepare for
trial or discovery or an administrative hearing or alternative dispute resolution and to act as a
witness when requested by the Company at reasonable times designated by the Company. Concerning
the aforementioned cooperation associated with an actual, potential or threatened legal claim in
which you will be a witness, the Company shall reimburse you for the reasonable out-of-pocket costs
you have incurred, such as travel and lodging.
9. Amendment — This letter agreement shall be binding upon the parties and may not be modified
in any manner, except by an instrument in writing of concurrent or subsequent date signed by duly
authorized representatives of the parties hereto. This letter agreement is binding upon and shall
inure to the benefit of the parties and their respective agents, assigns, heirs, executors,
successors and administrators.
10. Waiver of Rights — No delay or omission by the Company in exercising any right
under this letter agreement shall operate as a waiver of that or any other right. A waiver or
consent given by the Company on any one occasion shall be effective only in that instance and shall
not be construed as a bar or waiver of any right on any other occasion.
11. Validity — Should any provision of this letter agreement be declared or be determined by
any court of competent jurisdiction to be illegal or invalid, the validity of the remaining parts,
terms or provisions shall not be affected thereby and said illegal or invalid part, term or
provision shall be deemed not to be a part of this letter agreement.
12. Confidentiality — To the extent permitted by law, you understand and agree that as a
condition for payment to you of the severance benefits herein described, the terms and contents of
this letter agreement, and the contents of the negotiations and discussions resulting in this
letter agreement, shall be maintained as confidential by you and your agents and representatives
and shall not be disclosed except to the extent required by federal or state law or as otherwise
agreed to in writing by the Company.
13. Nature of Agreement — You understand and agree that this letter agreement is a
severance agreement and does not constitute an admission of liability or wrongdoing on the part of
the Company.
14. Section 409A — No payments that may be made pursuant to this letter agreement that
constitute “nonqualified deferred compensation” within the meaning of Section 409A of the Internal
Revenue Code and the guidance issued thereunder (“Section 409A”) may be accelerated or deferred by
the Company or by you. Notwithstanding anything else to the contrary in this letter agreement, to
the extent that any of the payments that may be made hereunder constitute “nonqualified deferred
compensation”, within the meaning of Section 409A and you are a “specified employee” upon your
resignation (as defined under Section 409A), any such payment
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shall be delayed following your Resignation Date if, absent such delay, such payment would
otherwise be subject to penalty under Section 409A. In any event, the Company makes no
representation or warranty and shall have no liability to you or to any other person if any
provisions of this letter agreement are determined to constitute “nonqualified deferred
compensation” subject to Section 409A but do not satisfy the requirements of that section.
15. Acknowledgments — You acknowledge that you have been given at least twenty-one
(21) days to consider this letter agreement, including Attachment A, and that the Company advised
you to consult with an attorney of your own choosing prior to signing this letter agreement. You
understand that you may revoke this letter agreement for a period of seven (7) days after you sign
this letter agreement by notifying Xxxxxxx Xxxxxx in writing, and the letter agreement shall not be
effective or enforceable until the expiration of this seven (7) day revocation period. You
understand and agree that by entering into this agreement, you are waiving any and all rights or
claims you might have under the Age Discrimination in Employment Act, as amended by the Older
Workers Benefits Protection Act, and that you have received consideration beyond that to which you
were previously entitled.
16. Voluntary Assent — You affirm that no other promises or agreements of any kind
have been made to or with you by any person or entity whatsoever to cause you to sign this letter
agreement, and that you fully understand the meaning and intent of this letter agreement. You
state and represent that you have had an opportunity to fully discuss and review the terms of this
letter agreement, including Attachment A, with an attorney. You further state and represent that
you have carefully read this letter agreement, including Attachment A, understand the contents
herein, freely and voluntarily assent to all of the terms and conditions hereof and sign your name
of your own free act.
17. Applicable Law — This letter agreement shall be interpreted and construed by the
laws of New Hampshire, without regard to conflict of laws provisions. You hereby irrevocably
submit to and acknowledge and recognize the jurisdiction of the courts of New Hampshire, or if
appropriate, a federal court located in New Hampshire (which courts, for purposes of this letter
agreement, are the only courts of competent jurisdiction), over any suit, action or other
proceeding arising out of, under or in connection with this letter agreement or the subject matter
hereof.
18. Entire Agreement — This letter agreement, including Attachment A, contains and
constitutes the entire understanding and agreement between the parties hereto with respect to your
severance benefits and the settlement of claims against the Company and cancels all previous oral
and written negotiations, agreements and commitments in connection therewith. Nothing in this
paragraph, however, shall modify, cancel or supersede your obligations set forth in paragraph 4
herein.
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If you have any questions about the matters covered in this letter agreement, please call
Xxxxx Xxxxx at 000-000-0000.
| Very truly yours, |
||||
| By: | /s/ Xxx Xxxxxxx | |||
| Xxx Xxxxxxx | ||||
| President and CEO | ||||
I hereby agree to the terms and conditions set forth above and in Attachment A. I have been
given at least twenty-one (21) days to consider this letter agreement (including Attachment A) and
I have chosen to execute this on the date below. I intend that this letter agreement will become a
binding agreement between me and the Company if I do not revoke my acceptance in seven (7) days.
/s/ Xxxxx X. XxXxxxxxx
|
April 19, 2007 | |||
Xxxxx XxXxxxxxx
|
Date |
To be returned by May 7, 2007
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ATTACHMENT A
DESCRIPTION OF SEVERANCE BENEFITS
If you timely sign and return this letter agreement and do not revoke your acceptance, the
Company will pay you twelve (12) months salary continuation (equivalent to $220,000), less all
applicable taxes and withholdings, as severance pay (the “Severance Pay Period”). This Severance
Pay will be paid in accordance with the Company’s normal payroll procedures, but in no event will
begin earlier than the eighth (8th) day after you timely execute, return, and do not
revoke this letter agreement.
Effective as of the Termination Date, you shall be considered to have elected to continue
receiving group medical insurance pursuant to the federal “COBRA” law, 29 U.S.C. § 1161 et seq.
During the Severance Pay Period, the Company shall continue to pay the share of the premium for
such coverage that is paid by the Company for active and similarly-situated employees who receive
the same type of coverage. The remaining balance of any premium costs, and all premium costs after
the Severance Pay Period, shall be paid by you on a monthly basis for as long as, and to the extent
that, you remain eligible for COBRA continuation. You should consult the COBRA materials to be
provided by the Company for details regarding these benefits.
You are also entitled to receive continued payments from the Company resulting from the
liquidation of the Company’s Toner Division pursuant to that certain Asset Purchase Agreement,
dated as of January 10, 2006, by and between the Company and Katun Corporation based on royalty
payments received by the Company from Katun Corporation pursuant to such agreement. Such payments
to you shall be equal to 3% of the amount of such royalty payments received by the Company from
Katun Corporation pursuant to the Asset Purchase Agreement, and shall be paid to you promptly
following the receipt of the royalty payment from the Company; provided, however, that the maximum
aggregate amount of such continued payments to you pursuant to this paragraph shall be $132,664,
which is $400,000 minus the amount of the divisional sale bonus amount paid to you in 2006 and
2007.
Outplacement services will be provided to you through Xxxxxxx, Xxxxxxxxx Xxxxxxx or a
correspondent office in your area. Xxx Xxxxxxx will contact you within one (1) week of the
effective date of the letter agreement. However, you may contact Xxx at 000-000-0000. His email
address is xxxxxxxx@xxxxxxx.xxx.
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