EXHIBIT (10)(viii)
[American Standard Companies Inc. letterhead]
November 2, 2001
Mr. Xxxxx Xxxxxxx
Xxx Xxxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Dear Xxx:
This letter constitutes the entire agreement between American Standard
Companies and you regarding the separation of your employment with the Company.
Please read this letter carefully, then sign the copy of this Agreement and
Release where indicated on the last page and return it to me by November 23,
2001.
1. Your employment as an officer of the Company and any of its affiliates
of which you have been an officer will terminate on December 31, 2001
("Termination Date").
2. Pursuant to the Company's Corporate Officer Severance Plan, commencing
on January 1, 2002, you shall commence receiving Salary Continuation at
your current base salary of $400,000 for a two-year period, terminating
on December 31, 2003. You will also receive your Annual Incentive Plan
Target award ($280,000) for 2001, 2002 and 2003. These amounts will be
paid when they are normally distributed under the Annual Incentive
Plan.
3. With respect to the Long-Term Incentive Plan, you (or in the event of
your death, your Named Beneficiary under the Long-Term Plan) will be
entitled to receive the values of your Long-Term Award Opportunities
for the Long-Term Plan's 1999-2001 Performance Period at full
participation in the amount of $520,000, its 2000-2002 Performance
Period will be based upon two-thirds participation in the amount of
$348,400, and its 2001-2003 Performance Period will be based upon
one-third participation in the amount of $173,200. Such values will be
paid when they are normally distributed under the Long-Term Incentive
Plan.
4. Stock Options, which have been granted to you under the American
Standard Companies Inc Stock Incentive Plan, which have vested by your
employment termination date, must be exercised by you within ninety
(90) days of such date. Failure to so exercise such options within this
time period will result in their forfeiture.
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5. Shares of American Standard stock earned under any incentive plans and
currently held in trust will be distributed to you after your
termination date.
6. Your benefits under the Company's Executive Supplemental Retirement
Benefit Program (the "SERP") which will accrue through your termination
date is fully vested. You must choose the distribution date of the SERP
payment before your 55th birthday, in accordance with the Plan, in the
form of a lump-sum payment calculated as specified in the SERP.
7. Your accounts in the Savings Plan of American Standard Inc. and
Participating Subsidiary Companies and in the American-Standard
Employee Stock Ownership Plan (the "ESOP") are fully vested and your
rights and interests therein will be governed by their respective
terms. Contributions to such accounts will cease as of your employment
termination date.
8. Your medical, accident and life insurance benefits will be continued
for two years following your termination date, under the same terms and
conditions as though you were actively employed, unless you acquire at
least equal alternative coverage.
9. Following the two-year period referred to in Item 9--(2)-- above, (a)
you and your eligible dependent(s) will be covered under the retiree
medical insurance program applicable to other salaried retirees,
provided you make the applicable required contributions; (b) you will
have Company-provided executive retiree life insurance coverage; and
(c) you will be provided retiree life insurance of $50,000 which will
be graduated down to a minimum level of $12,500.
10. Five weeks of unused vacation will be paid in a lump sum based on your
current base salary upon termination.
11. If the Company, in its sole discretion, determines that any payment
hereunder is subject to income tax withholdings, the Company will
deduct from such payment, for remittance to the appropriate taxing
authority, such withholding amount as the Company, in its sole
discretion, determines to be appropriate.
12. The Company will reimburse you for all reasonable bills that you
receive and submit for financial planning, tax return preparation and
audit assistance covering years through 2003, in accordance with the
same procedures for such reimbursement as are now in effect and
applicable to executive officers of the Company, up to an annual
maximum of $10,000. In addition, the Company will reimburse you for all
legal services performed on your behalf in connection with the review
of this Agreement up to a maximum of $5,000.
13. The Company shall reimburse you for relocation expenses of $75,000,
less applicable taxes, to assist you in moving out of New Jersey.
14. The Company shall provide executive outplacement services mutually
selected by you and the Company. The Company shall provide a reference
letter as attached. All verbal references will be entirely consistent
with this written reference.
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15. RELEASE OF CLAIMS AGAINST AMERICAN STANDARD INC. In exchange for
benefits provided herein to which you would not otherwise be entitled,
you hereby waive, release and forever discharge American Standard
Companies Inc., American Standard Inc., its subsidiaries, successors,
predecessors and assigns, its employees, agents, directors, officers
and stockholders, past and present, from any and all claims of any
nature whatsoever you have arising out of or in any way related to your
employment and termination of employment, known or unknown, including,
but not limited to, any claims arising under the Federal Age
Discrimination in Employment Act ("ADEA"), Americans with Disabilities
Act ("ADA"), Title VII of the Federal Civil Rights Act, The Civil
Rights Act of 1991, or any other Federal, State or Local Statutes or
Common Law concerning employment and you agree to bring no action, suit
or other proceedings in connection hereunder. The Company hereby
waives, releases and forever discharges you from any and all claims of
any nature whatsoever its has arising out of or in any way related to
your employment, which arise prior to the executive of this Agreement.
This section and the release hereunder shall not apply to claims
arising under ADEA after your execution of this Agreement. Except as
may be expressly varied herein, any rights to benefits under American
Standard sponsored benefit plans are governed exclusively by the
written Plan documents.
16. For a period of twenty-four months after your Termination Date, you
shall not directly or indirectly, engage in or have any ownership
interest in or financial participation in, or be employed by, or offer
services to, the same or similar business as the Company or which
competes in any way with the business conducted by the Company, or
become involved, affiliated or provide assistance with any business or
person engaged in the same or similar business as the Company or which
competes in any way with the business conducted by the Company as an
Executive, shareholder, director, officer, agent, partner, member,
investor, employee, consultant, independent contractor, joint venturer,
or otherwise. You further agree that you will advise any prospective
employer of this covenant.
17. You agree that for a period of twenty-four months after your employment
termination you shall not, directly or indirectly, solicit any employee
of the Company or its affiliates to terminate his or her employment.
The provisions of paragraphs 16, 17, 18 and 19 would not be enforceable
in the event that the Company substantially and materially breaches any
of its obligations contained in this Agreement or becomes bankrupt.
18. CONFIDENTIALITY: NON-ADMISSION
You agree not to disclose or cause any other person to disclose to
third parties, including employees of American Standard Inc., the terms
of this Agreement and Release, provided that you have the right to
disclose the terms of this Agreement and Release to your spouse, your
attorney, your financial advisor, and in response to a governmental
inquiry, including a governmental tax audit or a judicial subpoena. You
understand that your breach of this confidentiality provision shall
excuse American Standard Inc. from performing further under this
Agreement and Release, and American Standard Inc shall be entitled to
repayment of the
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value of the benefits granted to you as consideration under the terms
of this Agreement upon demand. You agree that neither this Agreement
and Release nor any version of this Agreement and Release shall be
admissible in any forum as evidence against American Standard Inc. or
you except in a proceeding to enforce this Agreement and Release and
that this Agreement and Release does not constitute an admission of
wrongdoing by American Standard Inc.
You shall not disclose to any other employer or person any trade
secrets or any proprietary, confidential or privileged information or
materials pertaining to the Company or its affiliates, including
(without limitation) any information concerning the management,
business operations, financial conditions, capital and credit
arrangements or any projections, forecasts or plans with respect to any
of the foregoing.
In accordance with normal ethical and professional standards, you will
refrain from taking actions or making statements, written or oral,
which disparage or defame the good will or reputation of the Company,
its directors, officers, executives and employees of which could
adversely affect the morale of other employees.
In accordance with normal ethical and professional standards, the
Company's Officers and Directors will refrain from taking actions or
making statements, written or oral, which disparage or defame your
reputation.
19. a) You agree that you will personally provide reasonable assistance and
cooperation to the Company in activities related to the prosecution or
defense of any pending or future lawsuits or claims involving the
Company. The Company agrees to pay all reasonable expenses and other
costs related to such assistance and cooperation.
b) You will promptly notify the Company if you receive any requests
from anyone other than an employee or agent of the Company for
information regarding the Company or if you become aware of any
potential claim or proposed litigation against the Company.
c) You will refrain from providing any information related to any claim
or potential litigation against the Company to any non-Company
representative without either the Company's written permission or being
required to provide information pursuant to legal process.
d) If required by law to provide sworn testimony regarding any
Company-related matter, you will consult with and have
Company-designated legal counsel present for such testimony.
e) The Company will be responsible for the costs of such designated
counsel and you will bear no cost for same.
f) You will confine your testimony to items about which you have
knowledge rather than speculation, unless otherwise directed by legal
process.
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g) You will cooperate with the Company's attorneys to assist their
efforts, especially on matters you have been privy to, holding all
privileged attorney-client matters in strictest confidence.
Nothing in sentences c-g of the above paragraph is intended to apply to
governmental or judicial investigations; provided, however, the Company
will reimburse you for legal expenses if you are compelled to appear in
a government or judicial investigation.
20. SEVERABILITY; ENTIRE AGREEMENT; NO ORAL MODIFICATION; NO WAIVERS
Should any of the provisions of this Agreement and Release be
determined to be invalid by a court of competent jurisdiction, the
parties agree that this shall not affect the enforceability of the
other provisions in good faith to effectuate its or their purpose and
to confirm the provision or provisions to law. The American Standard
Inc. and Subsidiaries Agreement Concerning Inventions and Proprietary
Information, is incorporated by reference as if set forth fully herein
and as such, you continue to be bound by all of its provisions. This
Agreement and Release constitutes a single integrated contract
expressing the entire agreement of the parties with respect to the
subject matter hereof and supersedes all prior and contemporaneous oral
and written agreements and discussions with respect to the subject
matter hereof. This Agreement and Release, and all provisions contained
in it, shall be binding upon and inure to the benefit of the parties
and their respective heirs, personal representatives, successors and
assigns. This Agreement and Release may be amended or modified only by
an agreement in writing signed by you and the Company and no amendments
or modifications are contemplated at this time. The failure by the
Company to declare a breach or otherwise to assert its rights under
this Agreement and Release or the Plan shall not be construed as a
waiver of any right the Company has under this Agreement and Release or
under the Plan.
21. ACKNOWLEDGEMENTS AND CERTIFICATIONS
You acknowledge and certify that you:
a. have read and understand all of the terms of this Agreement and
Release and do not rely on any representation or statement,
written or oral, not set forth in the Agreement and Release.
b. have had a reasonable period of time to consider this Agreement
and Release;
c. are signing this Agreement and Release knowingly and voluntarily;
d. have been advised to consult with an attorney before signing this
Agreement and Release;
e. have the right to consider the terms of this Agreement and Release
for 21 days and if you take fewer than 21 days to review this
Agreement and
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Release, you hereby waive any and all rights to the balance of the
21 day review period; and
f. have the right to revoke this Agreement and Release within seven
consecutive calendar days after signing and dating it, by
providing written notice of revocation to X. Xxxx XxXxxxx, Senior
Vice President, General Counsel and Secretary, American Standard
Companies Inc. If you revoke this Agreement and Release during
this seven-day period, it becomes null and void in its entirety.
If you do not revoke this Agreement and Release, after such seven
days, it becomes final.
22. If the Company reasonably, non-discriminatorily, non-capriciously and
non-arbitrarily, determines that you have materially violated any of
your obligations under this Agreement and Release, then the Company
will notify you in writing of this violation and the Company may, at
its option, terminate the Salary and Benefit Continuation and any other
benefits hereunder to which you were not otherwise entitled. The
Company may demand the return of all payments already made and you
hereby agree to return such payments upon such demand. If you fail to
do so, the Company has the right to recover costs and attorney's fees
associated with such recovery. Prior to doing so, however, the parties
must discuss and attempt to reach an agreement, including granting you
a period of 30 days to cure an alleged violation.
23. Your obligations and the obligations of the Company as set forth in
this Agreement will survive indefinitely.
Understood and Agreed: Sincerely,
By: /s/ Xxxxx Xxxxxxx /s/Xxxxxxxx Xxxxxxxx
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Xxxxx Xxxxxxx Xxxxxxxx Xxxxxxxx
Senior Vice President, Human
Resources
Dated: November 29, 2001
