GENERAL RELEASE AND COVENANT NOT TO SUE
Exhibit
10.1
GENERAL RELEASE AND COVENANT
NOT TO XXX
This
GENERAL RELEASE AND COVENANT NOT TO XXX ("Agreement") is made and entered by and
between Xxxxxxx X. Xxxx ("Employee"), an individual residing at 0000 Xxxxxxxx
Xxxx, Xxxxxxxxx, XX 00000, and Lexmark International, Inc., a corporation whose
principal executive offices are located at 000 Xxxx Xxx Xxxxxx Xxxx, Xxxxxxxxx,
XX 00000 (hereinafter referred to as "Lexmark").
Subject to the conditions and
qualifications set forth below, and in consideration of the mutual promises
contained in this Agreement and in consideration of (i) Lexmark’s
paying to Employee the amount of $420,000.00 less applicable withholdings, to be
paid to Employee in a lump sum; and (ii) Lexmark’s paying to Employee a pro-rata
share of the Annual Bonus, to be calculated as follows. If the
Employee’s Date of Termination is prior to July 1, 2008 the pro rata
share of the annual bonus will be equal to the product of (1) the Target Bonus
and (2) a fraction equal to the number of full months in such year prior to the
Date of Termination over 12. If the Employee’s Date of Termination is
on or after July 1, 2008, the pro rata share of the annual bonus will be equal
to the product of (1) the Annual Bonus, calculated based on the actual
achievement, as certified by the Compensation and Pension Committee of the
Employer’s Board, of the Annual Objectives, and (2) a fraction equal to the
number of full months in such year prior to the Date of Termination over 12, and
will be paid to Employee within 2 ½ months of the close of the performance year
in respect of which the pro rata share of the Annual Bonus is
payable; (iii) Lexmark’s providing to Employee access to
continued medical (including vision) and dental coverage at the then-current and
applicable active “employee” contribution rate through June 30, 2009 or until
such coverage is made available to Employee by a subsequent employer, whichever
occurs first, such coverage to be provided under
Lexmark’s benefits plans (via the Lexmark COBRA administrator) as such plans are
amended by Lexmark from time to time as permitted by plan documentation and
applicable law, provided that Employee pays timely the then-current and
applicable "employee" contribution rate; and (iv) Lexmark’s providing Employee
with reimbursement of up to $25,000 (actual expenses incurred to be grossed up
for tax purposes) for any career transition assistance service expenses incurred
through June 30, 2009, to be paid by Lexmark to Employee upon receipt by Lexmark
of appropriate invoicing, all in accordance with Attachment A to this Agreement,
which is incorporated by reference herein or payment of up to $25,000 directly
to an outplacement provider (assumed to be taxable to the employee and actual
expenses incurred also grossed up for tax purposes); it is agreed as
follows:
1. Employee’s last date of
employment with Lexmark shall be June 27, 2008 (“Departure Date”).
2. This Agreement is for the
benefit of Lexmark, its divisions, subsidiaries, affiliates, owners,
stockholders, successors, assigns, agents, directors, officers, employees,
suppliers, representatives, attorneys and predecessors, and any and all
persons
acting by, through, under or in concert with any of the foregoing (collectively,
"Lexmark Releasees").
3. Employee shall not
disclose to any person or use any confidential or proprietary information,
knowledge or data that is not theretofore publicly known and in the public
domain, or obtained by Employee while in the employ of Lexmark with respect to
Lexmark or any of its subsidiaries or affiliates, or with respect to any
products, improvements, formulas, designs, processes, customers, methods of
sales, distribution, operation or manufacture, sales, prices, profits, costs,
contracts, suppliers, business prospects, business methods, techniques,
research, plans, strategies, personnel, organization, trade secrets or know-how
of Lexmark or any of its subsidiaries or affiliates, except as may be required
by law or by a judge in a judicial proceeding or by an authorized government
inquiry or investigation.
4. Employee shall deliver to
Lexmark on or before the date on which Employee executes this Agreement all
non-personal documents and data of any nature pertaining to Employee’s work with
Lexmark, and Employee shall not take from Lexmark or retain any such documents
or data of any description or any reproduction thereof, or any documents
containing or pertaining to any Lexmark confidential or proprietary information,
knowledge or data. Employee represents that Employee has returned to
Lexmark all such documents and data as well as all Lexmark property and assets
in Employee's possession, including but not limited to a laptop (except
Employee’s cell phone which he is permitted to keep and assume financial
responsibility for). Employee represents that Employee has no
outstanding balance under his/her Lexmark Corporate American Express
card. Employee understands that the cost of replacing any unreturned
property and assets (whether or not actually replaced) and any amounts that
Employee owes to Lexmark or any third party on behalf of Lexmark may be deducted
from any form of compensation which may be due to the Employee from Lexmark
(including but not limited to wages, salary, bonuses, commissions, severance
pay, vacation pay, fringe benefits, expense reimbursements and the proceeds
resulting from any form of equity compensation, including but not limited to any
unrealized option gains not otherwise forfeited due to the circumstances of the
termination of Employee’s employment) and Employee hereby consents to such
deduction.
5. Employee agrees that
Employee shall not disparage any Lexmark Releasee or any Lexmark product or
service.
6. Employee represents that
Employee has not filed with any local, state or federal agency or court, or
assigned or transferred to any person or entity, any claims, complaints, charges
or actions of any nature against any Lexmark Releasee or any interest
therein.
7. Employee hereby
irrevocably and unconditionally releases, waives, acquits, and forever
discharges each of the Lexmark Releasees from any and all charges, complaints,
claims, liabilities, obligations, promises, representations, inducements,
agreements, controversies, damages, actions, causes of action, suits, rights,
demands,
costs,
losses, debts and expenses (including attorney's fees and costs actually
incurred) of any nature whatsoever, known or unknown, fixed or contingent (each
a “Claim”), including, but not limited to, Claims arising under the Age
Discrimination in Employment Act of 1967, as amended, Title VII of the Civil
Rights Act of 1964, as amended, the Employee Retirement Income Security Act of
1974, as amended, the Americans With Disabilities Act of 1990, as amended, the
Kentucky Civil Rights Act, as amended, and any other federal, state or local law
which addresses employee benefit matters or addresses or prohibits
discrimination in employment, and Claims arising under any stock
incentive awards or under the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, the Worker Adjustment Retraining Notification
Act, as amended, the Uniformed Services Employment and Reemployment Rights Act
of 1994, as amended, and any other federal, state or local law addressing
securities law matters, which Claim Employee now has, owns or holds, or alleges
to have had, owned or held, or which Employee at any previous time had, owned or
held, or alleged to have had, owned or held, against each of the Lexmark
Releasees, and including, but not limited to, any Claim arising out of or
related to Employee's employment with Lexmark. Notwithstanding
the foregoing, the term “Claim” shall not include, and Employee does not waive
any rights or claims that may arise after Employee executes this
Agreement.
8. Employee covenants with
Lexmark and agrees that Employee will never file or institute any demand, claim,
charge, complaint, proceeding, suit or action in any state or federal court
asserting any Claim against any of the Lexmark Releasees. Provided,
the provisions of Paragraph number seven (7) and this
Paragraph number eight
(8) are not intended to preclude Employee from challenging the
knowing and voluntary nature of this Agreement or participating in any
investigation or proceeding conducted by the Equal Employment Opportunity
Commission (“EEOC”). Provided further, however, Employee waives any right
to any monetary recovery should any federal, state, or local administrative
agency pursue any claims on Employee’s behalf arising out of or related to
Employee’s employment with and/or termination of employment with
Lexmark.
9. Employee understands that
Paragraphs number seven (7) and eight (8) of this
Agreement shall not apply to or have any effect upon any vested interest
Employee may have in any employee benefit plan maintained or sponsored by
Lexmark. Employee acknowledges and agrees that no other separation
payments or benefits are to be paid or given to Employee by Lexmark other than
the benefits and payments specifically set forth herein.
10. Employee represents and
agrees that Employee will not be re-employed by Lexmark, and that Employee will
not apply for or otherwise seek employment with Lexmark, its subsidiaries or
successors at any time in the future. Likewise, Employee will not
seek employment as a contractor, through a contract organization, vendor or
otherwise with assignment on Lexmark premises or with any other assignment to
perform work on behalf of Lexmark. Employee agrees and acknowledges
that a breach of this provision shall constitute a legitimate,
non-discriminatory reason for the refusal to hire Employee or consider Employee
for employment in the future.
11. Employee represents and
agrees that, except as permitted by paragraph number fourteen (14) below,
and except for any information publicly disclosed by Lexmark, Employee and all
members of Employee’s immediate family will keep the terms, amount and fact of
this Agreement and any communication or negotiations leading up to this
Agreement completely confidential. If this paragraph is violated,
Employee agrees to return to Lexmark an amount equal to fifty percent (50%) of
the total dollar amount to be paid by Lexmark to Employee under this Agreement
as liquidated damages for the injury which Lexmark will suffer as a result of
such breach.
12. If Employee violates any
provision of this Agreement, then (i) all stock incentive awards, including but
not limited to stock options, restricted stock awards and any deferred stock
units, held by Employee shall terminate effective the date on which Employee
violates this Agreement, unless terminated sooner by operation of another term
or condition of Employee’s stock incentive award agreement or the plan pursuant
to which such award has been issued, and (ii) any gain realized by Employee on
the vesting of restricted stock or deferred stock units, and option gains
(represented by the closing market price on the date of exercise over the
exercise price, multiplied by the number of options exercised without regard to
any subsequent market price decrease or increase) realized by Employee from
exercising all or a portion of Employee’s options, within eighteen (18) months
prior to Employee’s Departure Date and until such time as the violation of this
Agreement is discovered by Lexmark, shall be paid by Employee to
Lexmark.
13. Employee represents and
acknowledges that in executing this Agreement, Employee does not rely upon and
has not relied upon any representation or statement made by any of the Lexmark
Releasees with regard to the subject matter, basis or effect of this Agreement
or otherwise and that this Agreement constitutes the entire agreement and
supersedes all prior agreements.
14. Employee represents and
confirms that Employee has been advised by Lexmark to consult (at Employee’s
expense) with an attorney and otherwise seek financial and legal advice prior to
executing this Agreement, has thoroughly discussed all aspects of this Agreement
with such advisors as Employee has determined appropriate, has carefully read
and fully understands all of the provisions of this Agreement, is voluntarily
entering into this Agreement, has had at least twenty-one (21) days to consider
this Agreement prior to signing it, and has had a reasonable period of time to
consider this Agreement.
15. This Agreement shall be
binding upon Employee and upon Employee's heirs, administrators,
representatives, executors, successors and assigns, and shall inure to the
benefit of each of the Lexmark Releasees, and to their heirs, administrators,
representatives, executors, successors, and assigns.
16. In the event that any
one or more of the provisions of this Agreement shall be or become invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not be
affected thereby.
17. Employee understands and
agrees with Lexmark that this Agreement is not effective or enforceable for
seven (7) days following the date this Agreement is executed by Employee and
that within the seven (7) days following such date Employee may revoke this
Agreement by written notice to Xxxx X. Xxxxxx, Vice President of Human Resources
at Lexmark, 000 Xxxx Xxx Xxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxx, 00000 (facsimile:
(000) 000-0000).
18. No sums payable by
Lexmark to Employee pursuant to this Agreement shall be paid or owing to
Employee until the end of the period during which this Agreement can be revoked
by Employee, if this Agreement is not so revoked, and, thereafter, shall be
payable or owing by Lexmark at the time(s) specifically specified in this
Agreement .
This
offer will expire if Employee does not accept it by July 18, 2008 unless it is
earlier revoked by Lexmark.
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June
26, 2008
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DATE
RECEIVED BY EMPLOYEE
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6/27/08
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/s/
Xxxxxxx X. Xxxx
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DATE
OF EXECUTION
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EMPLOYEE
SIGNATURE
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(not before July
18, 2008) Voluntarily Waived /s/ VJC
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LEXMARK
INTERNATIONAL, INC.
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By:
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/s/ Xxxx X. Xxxxxx |
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Name:
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Xxxx
X. Xxxxxx
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Title:
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Vice
President, Human Resources
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Date:
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6/27/08 |
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Attachment
A
Career
Transition Assistance Guidelines
Career
transition assistance consists of reimbursement of up to an aggregate of
$25,000.00 for the cost of services such as cover letter and resume preparation,
counseling, retraining, and skills building.
Reimbursements
under career transition assistance will be available for actual costs incurred
and assistance completed by June 30, 2009. Requests for
reimbursement must be submitted using the Career Transition Assistance
Reimbursement Application no later than September 30, 2009.
Reimbursable
expenses include charges for preparation of resumes and cover letters, interview
skills training, career assessment and employment agency fees.
In
addition, tuition and application fees, registration or general service fees,
fees for evaluating past work experience and training, and expenses for books
and supplies (when the use and ownership is required for the completion of
training) are also reimbursable expenses. Institutions considered
eligible to provide these services are accredited colleges, universities, and
high schools, as well as business, technical, or correspondence
schools.
Lexmark’s
reimbursement is not an endorsement of any service provider, and Lexmark assumes
no responsibility for the content of the assistance obtained by an
employee.
Career
transition assistance does not include reimbursements for travel, meals,
lodging, service charges, withdrawal fees, activity fees, or books or supplies,
whether purchased by the student or provided by the institution for use during
training and offered for student purchase after the training. Also,
the cost of equipment such as personal computers or printers is not eligible for
reimbursement, nor are expenses associated with financial or tax
planning.
CAREER
TRANSITION ASSISTANCE
REIMBURSEMENT
FORM
Completed
application should be sent to:
Lexmark
International, Inc.
Career Transition
Assistance
Department 505437,
Xxxx. 000-0
000 Xxxx Xxx Xxxxxx
Xxxx
Xxxxxxxxx,
XX 00000
To apply
for benefits:
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1.
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Complete
a copy of this application fully with each submission and send along with
original receipts to the above address after you have incurred and paid
for the course or service. Expenses will be paid
per the terms of your Departure Agreement.
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2.
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Reimbursement
requests without complete information (application and/or supporting
receipts) will be returned to you with instructions for
re-submission. Please refer to Career Transition Assistance
Guidelines for eligibility
requirements.
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Name,
Please
Print Serial
Number Amount
of Claim
(Last,
First, Middle Initial)
Street
Address City State Zip
Code
+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Institution/Instructor Course/Service Start
Date / End Date
I certify
that the statements in this application are correct and that the attached bills
are actual eligible expenses which I incurred. I understand that
reimbursement by Lexmark is not an endorsement of any service provider and that
Lexmark assumes no responsibility for the content of the
assistance.
I
authorize Lexmark to obtain or view a copy of my records pertaining to expenses
for which this reimbursement is submitted. I understand that such
information will be used only to the extent necessary to determine the validity
or amount payable on account of this reimbursement. A copy of this
authorization shall be as effective as the original.
Signature
of Program
Participant Date Former
Work Location
