EXHIBIT 10.39
Group Technologies Corporation
00000 Xxxxxxx XxXxxxxx Xxxxx
Xxxxx, Xxxxxxx 00000
December 10, 1996
Xx. Xxxx X. XxXxxxxxx
0000 Xxxxxx Xxxxxx Xxxx
Xxxxx, Xxxxxxx 00000
Dear Xxxx:
This letter serves to confirm the terms of our agreement regarding your
separation from employment with Group Technologies Corporation (the "Company)
and supersedes all previous discussions and understandings with regard to your
separation from the Company.
Your resignation as President, Chief Executive Officer and Director of the
Company will be effective on Thursday, October 31, 1996; however, you will
continue to be employed by the Company through December 31, 1996. Effective
January 1, 1997, you will be placed on layoff status until December 31, 1998.
You will receive your final paycheck for the period ending December 31, 1996 on
your last day of employment. For the remainder of 1996, you will be expected to
assist in the transition of your duties and to assist with the ongoing efforts
to improve the operations and performance of the Company. Your salary and
benefits will remain at their current level through December 31, 1996. The
Company will also continue to pay you a car allowance and for any previously
approved club memberships or similar benefits through December 31, 1996. You
will be reimbursed for professional executive outplacement services, up to a
maximum of $5,000, upon receipt of invoices for such services. Furthermore,
this severance agreement is offered to you in return for the following specific
considerations:
1. You will not now, nor at any time while you are receiving payments pursuant
to the terms of this agreement, solicit or recruit any customers or
employees of the Company, or otherwise engage in any activity that would be
deemed to be detrimental to or competitive with the business of the Company
as it exists as of the date of this agreement.
The provisions of the foregoing notwithstanding, you may request the
written consent of the Company to become employed by a business that would
otherwise be viewed as being in competition with the Company. At the time
of such request, you must provide satisfactory assurance to the Company (in
its sole opinion) that you will not be engaged in that aspect of the
prospective employer's business which would otherwise be detrimental to the
Company and that the balance of the terms and conditions of this Agreement
will remain in full force and affect. In the case of any such request, the
Company will not unreasonably withhold its consent to your becoming so
employed.
2. You will be a goodwill spokesperson for the Company.
3. You will provide positive customer interface for a successful transition of
your responsibilities.
Xx. Xxxx X. XxXxxxxxx
December 10, 1996
Page Two
In consideration for tendering your resignation as President, Chief Executive
Officer and Director of the Company and for previous services rendered, the
Company will agree to provide you with pay continuance from January 1, 1997
through December 31, 1998, subject to your compliance with the terms and
conditions stated herein. Pay continuance will be calculated based upon an
annual rate of $175,000, less applicable federal and state taxes, and will be
dispersed in accordance with the standard payroll practices of the Company for
salaried personnel. Medical and dental benefits will continue, at employee
cost, through your pay continuance. You acknowledge that this severance is
above and beyond any moneys owed to you as a result of your employment with the
Company and serves as pay in lieu of notice.
The Company and the Board will take steps prior to your last day of employment
in order to amend the Company's stock option plans and any stock option
agreements so that all stock options granted to and held by you that will have
vested by December 31, 1998 will remain valid and effective for the stated term
of each option. Such options will be exercisable by you during the stated term
of each option in accordance with the terms and conditions of the applicable
stock option agreements entered into between you and the Company, as such terms
and conditions may be amended from time to time. Any options that are not
scheduled to vest on or before December 31, 1998 will become null and void as of
December 31, 1996. Other modifications may be necessary in order accommodate
your status as a non-employee option holder; however, those issues will also be
addressed prior to the last date of your employment. You expressly agree that
any breach of your obligations under this agreement will result in an immediate
cancellation and forfeiture of any and all unexercised stock options held by you
at the time of such breach.
You may elect to continue to make contributions to the Company sponsored 401(k)
plan through December 31, 1996, after which time you will no longer be eligible
to participate. Any funds that you have contributed to the Company's management
deferred compensation plan may be withdrawn in accordance with the terms and
conditions of that plan.
In exchange for the above severance pay, you agree to release and forever
discharge the Company, its affiliates, predecessors and successors, and their
directors, officers, employees and agents from any and all claims whatsoever
based on or arising in any way from or related to your employment with or
termination of your employment from the Company existing prior to this
agreement, including but not limited to, claims under any federal, state and
local employment laws such as the Age Discrimination in Employment Act (ADEA),
as amended, Title VII of the Civil Rights Act of 1964, as amended, and all other
laws, regulations and ordinances. Both parties agree that this release of
claims is an essential and material term of this agreement.
You acknowledge that through your employment as an officer of the Company, you
have obtained proprietary and highly confidential information regarding the
Company including, but not limited to, its accounts, customers, clients and
others with whom it may due business, as well as pricing, costs, strategies,
methods, forms, contracts and trade secrets. You agree that you will return to
the Company
Xx. Xxxx X. XxXxxxxxx
December 10, 1996
Page Three
any and all proprietary information in written form within your control prior to
your last day of employment. You agree that any breach of this paragraph will
result in a termination of the obligation of the Company to provide pay
continuance or any other benefits to you under the terms and conditions of this
agreement.
You also acknowledge that through your employment as an officer of the Company,
you have obtained proprietary and highly confidential information regarding the
Company including, but not limited to, its accounts, customers, clients and
others with whom it may do business, as well as knowledge of pricing, costs,
strategies, methods, forms, contracts and trade secrets used by the Company.
You agree that you will not, subsequent to the execution of this agreement,
disclose such confidential information or any part thereof to any person, firm,
corporation, association, or other entity for any reason or purpose whatsoever,
and that you will not use this information to the future detriment of the
Company. You agree that any breach of this paragraph will result in a
termination of the obligation of the Company to provide pay continuance or any
other benefits to you under the terms and conditions of this agreement.
You further acknowledge that through your employment as an officer of the
Company, you have maintained in your possession (at your personal residence or
otherwise) certain property that is owned by the Company and that you hold a
certain number of shares of common stock in other publicly traded companies that
were purchased by the Company in your name. You agree to return all Company
owned property and to transfer all shares of stock purchased by you for the
benefit of the Company (and for which expense you have been reimbursed) to Xxxxx
X. Xxxxxxx by no later than December 31, 1996. You agree that any breach of
this paragraph will result in a termination of the obligation of the Company to
provide pay continuance or any other benefits to you under the terms and
conditions of this agreement.
The Company will not terminate this agreement as a result of an alleged breach
of its terms and conditions without first having notified you in writing with
regard to the specific nature of the breach. You will then have twenty (20)
days from receipt of said notice to notify the Company in writing of your
disagreement with the notice. If you are in disagreement with the notice and
are unable to resolve the dispute with the Company within twenty (20) days
following the delivery of your response to the Company, then the parties will
agree upon the selection of an arbitrator who will render a binding ruling
within twenty (20) days. The cost of any such arbitration will be borne by the
party who failed to prevail.
The parties agree that the formation and interpretation of this agreement will
be governed by the laws of the State of Florida and that any action to enforce
this agreement will be taken in a Florida court of competent jurisdiction.
Additionally, the parties agree that the execution of this agreement will not be
interpreted as an admission of any wrongdoing by either party.
You acknowledge that you have had in excess of thirty-five (35) days to confer
with an attorney regarding the basic terms of this agreement. You also
acknowledge that you have been informed that you have ten (10) days after
signing this agreement to revoke it.
Xx. Xxxx X. XxXxxxxxx
December 10, 1996
Page Four
It is our understanding that the above accurately reflects all of the terms
discussed regarding your separation from the Company. As such, this agreement
constitutes the entire understanding between you and the Company (with regard to
your separation from the Company) and any modification to this agreement must be
in writing and signed by both parties. Both parties are in agreement with the
stated terms of this agreement and acknowledge that they have freely and
voluntarily signed this agreement.
If you understand and agree with the terms and conditions contained in this
letter, please sign and date below on the appropriate lines. If you have any
questions or concerns, please do not hesitate to contact me or the Human
Resources department. We would like to do everything possible to ensure you a
smooth and successful transition from the Company.
Sincerely,
Xxxxxxx X. Xxxx
Chairman of the Board
Acknowledged and agreed to:
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Xxxx. X. XxXxxxxxx Date
