AGREEMENT AND GENERAL RELEASE
This Agreement and General Release (hereinafter "AGREEMENT") is entered
into this 24th day of June, 1999, in the County of Maricopa, State of Arizona,
among MicroAge, Inc., a Delaware corporation ("MICROAGE"), Pinacor, Inc., a
Delaware corporation ("PINACOR"), and Xxxxxx X. X'Xxxxxx ("EXECUTIVE").
RECITALS
WHEREAS, Executive is currently serving as the Chief Executive Officer of
Pinacor, Inc.;
WHEREFORE, the parties have agreed that it is in their respective best
interests to amicably resolve all matters relative to Executive's employment
with Pinacor and separation therefrom pursuant to the following terms and
conditions:
I.
Pinacor covenants and agrees to provide Executive with the severance
benefits specified in paragraphs 1-10 on EXHIBIT A attached hereto (the
"SEVERANCE BENEFITS") and the additional benefits specified in paragraphs 11 -
14 on EXHIBIT A attached hereto (the "ADDITIONAL BENEFITS"). Executive covenants
and agrees to execute the resignation letter attached hereto as EXHIBIT B
resigning from his position as a Director and Chief Executive Officer of the
companies listed on such exhibit. The parties acknowledge and agree that the
Severance Benefits provided to Executive as set forth on EXHIBIT A are provided
pursuant to the Employment Agreement, dated as of January 4, 1999, by and
between Pinacor, Inc. and Xxxxxx X. X'Xxxxxx (the "EMPLOYMENT AGREEMENT"). The
parties agree that Pinacor will not provide the Additional Benefits hereunder
until Executive signs and returns the "Non-Revocation" form attached hereto as
EXHIBIT C.
Executive's separation from employment with Pinacor will be effective as of
June 30, 1999 (the "SEPARATION DATE").
Executive hereby acknowledges receipt of an advanced payment in the amount
of Thirty Seven Thousand Four Hundred and Forty-Eight Dollars and 58/100
($37,448.58), less applicable taxes, on June 15, 1999, $37,154.40 of which is in
complete satisfaction of the payment owed to Executive for his unused accrued
vacation days as set forth in EXHIBIT A, paragraph 2, and $294.18 of which is a
reimbursement for prepaid medical insurance.
It is expressly understood and agreed that, other than the severance
benefits being provided to Executive pursuant to this Agreement, neither
MicroAge, Pinacor, nor any of their affiliates is otherwise indebted to
Executive for any other damages, wages, benefits, or reimbursements.
1
II.
In exchange for the promises set forth in PARAGRAPH I above, Executive does
hereby forever release, discharge, cancel, waive, and acquit, for himself and
for his marital community, heirs, executors, administrators and assigns,
MicroAge, Pinacor, and any and all of their affiliates, subsidiaries, corporate
parents, agents, officers, owners, employees, attorneys, successors and assigns,
of and from any and all rights, claims, demands, causes of action, obligations,
damages, penalties, fees, costs, expenses, and liability of any nature
whatsoever which Executive has, had or may hereafter have against them or any of
them, arising out of, or by reason of any cause, matter, or thing whatsoever
existing as of the date of execution of this Agreement, WHETHER KNOWN TO THE
PARTIES AT THE TIME OF EXECUTION OF THIS AGREEMENT OR NOT. This FULL WAIVER OF
ALL CLAIMS includes, without limitation, attorney's fees, any claims, demands,
or causes of action arising out of, or relating in any manner whatsoever to, the
employment and/or termination of the employment of Executive, such as, BUT NOT
LIMITED TO, any charge, claim, lawsuit or other proceeding arising under the
Civil Rights Act of 1866, 1964, Title VII as amended by the Civil Rights Act of
1991, the Americans with Disabilities Act, the Age Discrimination in Employment
Act (ADEA), the Labor Management Relations Act, the Employee Retirement Income
Security Act, the Consolidated Omnibus Budget Reconciliation Act, the Fair Labor
Standards Act, the Arizona Civil Rights Act, Xxxxxxx'x Compensation Claims, or
any other federal, state, or local statute. Executive further covenants and
agrees not to institute, nor cause to be instituted, any legal proceeding,
including filing any claim or complaint with any government agency alleging any
violations of law or public policy, against MicroAge, Pinacor, and/or any and
all of their affiliates, subsidiaries, corporate parents, agents, officers,
owners, employees, successors and assigns premised upon any legal theory or
claim whatsoever, including without limitation, contract, tort, wrongful
discharge, personal injury, interference with contract, defamation, negligence,
infliction of emotional distress, fraud, or deceit, except to enforce the terms
of this Agreement.
III.
The parties and their respective attorneys agree to hold in strict
confidence the terms and conditions of this Agreement. The parties covenant and
agree that neither they nor their attorneys will, either directly or through any
other person, agent or representative, discuss publicly or privately the nature
or content of this Agreement with any non-party to this Agreement, except as to
either party's accountants, any state tax department or the federal Internal
Revenue Service, or any other state or federal official in response to a
legitimate inquiry.
IV.
Executive, by his execution of this Agreement, avows that the following
statements are true:
A. That he has been given the opportunity and has in fact read this entire
Agreement, that it is in plain language, and has had all questions regarding its
meaning answered to his satisfaction;
2
B. That he has been advised to seek independent advice and/or counsel of
his choosing and that he has been given the full opportunity to seek such advice
and/or counsel;
C. That he fully understands the contents of this Agreement and understands
that it is a FULL WAIVER OF ALL CLAIMS, including arbitration claims and awards,
against Executive, including any rights under the ADEA and as to ADEA claims is
not a waiver of future claims;
D. That this FULL WAIVER OF ALL CLAIMS is given in return for valuable
consideration, as provided under the terms of this Agreement;
E. That he enters into this Agreement knowingly and voluntarily in exchange
for the promises referenced in this Agreement and that no other representations
have been made to him to induce or influence his execution of this Agreement.
Executive has been given at least twenty-one (21) days within which to consider
this Agreement before signing and seven (7) days following his execution of the
Agreement to revoke this Agreement. The Agreement shall not become effective or
enforceable until the foregoing revocation period has expired and Executive has
signed and returned the "Non-Revocation" form attached hereto as EXHIBIT C; and
F. That he understands his continuing obligations under the Employment
Agreement, including but not limited to his obligations (a) to maintain the
confidentiality of Confidential Information (ss. 5.1 of the Employment
Agreement), and (b) not to compete with Pinacor or its affiliates for a
twenty-four month period (ss. 5.9 of the Employment Agreement). Without limiting
the generality of Executive's non-competition obligations, during the
Non-Competition Period (as defined in Section 5.9(a) of the Employment
Agreement) Executive agrees that Executive will not, either within or outside of
the Business Territory (as defined in Section 5.9(a) of the Employment
Agreement), act as an agent, representative, consultant, officer, director,
member, independent contractor, or employee of Arrow Electronics, Inc.; Avnet,
Inc.; Cambridge Research Associates, Inc.; CHS Electronics, Inc.; Compaq
Computer Corporation; CompuCom Systems, Inc.; CompUSA, Inc.; En Pointe
Technologies, Inc.; Entex Information Services; GE Capital; Ikon Office
Solutions, Inc.; Inacom Corp; Xxxxxx Micro, Inc.; Merisel, Inc.; Xxxxxxx
Computer Resources, Inc.; Sarcom; Tech Data Corporation; Xerox Connect; or any
Affiliates or successors of the foregoing.
V.
The parties confirm their continuing obligations under Section 5.10 of the
Employment Agreement, which provides as follows:
During the term of this Agreement, the Non-Competition Period, the Employee
Non- Solicitation Period, and the Customer Non-Solicitation Period, neither
the Executive nor the Company will disparage the other, and neither will
disclose to any third party the conditions of Executive's employment with
the Company, except as may be required (i) pursuant to applicable law or
regulations, including the rules and regulations of the Securities and
Exchange Commission, (ii) to effectuate the provisions of employee plans or
programs and insurance
3
policies, or (iii) as may be otherwise contemplated herein or unless such
information becomes publicly available without fault of the party making
such disclosure.
VI.
This Agreement shall be governed in all respects, whether as to validity,
construction, capacity, performance, or otherwise, by the laws of the State of
Arizona, and no action involving this Agreement may be brought except in the
Superior Court for the State of Arizona or the Federal District Court for the
District of Arizona.
VII.
If any provision of this Agreement or the application thereof is held to be
invalid, void, or unenforceable for whatever reason, the remaining provisions
not so declared shall nevertheless continue in full force and effect without
being impaired in any manner whatsoever.
VIII.
This Agreement constitutes the sole and entire Agreement between the
parties hereto, and supersedes any and all understandings and agreements made
prior hereto, other than the Employment Agreement. There are no collateral
understandings, representations, or agreements other than those contained herein
or in the Employment Agreement. It is understood and agreed that the execution
of this Agreement by MicroAge and Pinacor is not an admission of liability on
their parts to Executive, but is an agreement to put to rest any claim of any
kind whatsoever relating to the employment relationship or otherwise, except
that the parties may enforce their respective rights under the Employment
Agreement to the extent they are not inconsistent with this Agreement.
IN WITNESS WHEREOF, the undersigned parties have signed this Agreement on
the date indicated herein.
[BALANCE OF PAGE INTENTIONALLY LEFT BLANK]
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CAUTION! THIS IS A RELEASE! READ BEFORE SIGNING!
MICROAGE, INC. PINACOR, INC.
By: /s/ XXXXXXX X. XXXXXXXX By: /s/ XXXXX X. XXXXXX
-------------------------- ----------------------
Its: Chairman of the Board and Its: President
Chief Executive Officer
Date: June 24, 1999 Date: June 24, 1999
Xxxxxx X. X'Xxxxxx
/s/ XXXXXX X. X'XXXXXX
-------------------------
Date: June 24, 1999
5
VERIFICATION
STATE OF ARIZONA )
) ss.
County of Maricopa )
On this 24th day of June, 1999, before me, the undersigned Notary
Public, personally appeared Xxxxxx X. X'Xxxxxx, known to me to be the person
whose name is subscribed to the within instrument, and acknowledged that he
executed the same for the purpose therein contained.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/s/ XXXXXXX X. XXXXXX
------------------------
Notary Public
My Commission Expires October 31, 1999
6
EXHIBIT A
SEVERANCE BENEFITS
1. SALARY PAYMENTS. In consideration of the benefits paid to Executive
pursuant to this Agreement, and notwithstanding anything contained in Section
4.3(f) of the Employment Agreement to the contrary, Executive hereby waives his
right to receive payments under Section 4.3(f) of the Employment Agreement. This
Section 1 shall be deemed to be an amendment to the Employment Agreement.
2. ACCRUED VACATION DAYS. As of May 31, 1999, Executive will have 240 hours
of unused accrued hours, or 30 days (the "ACCRUED VACATION DAYS"). Pinacor will
reimburse Executive for such unused accrued vacation days in an amount equal to
Executive's current annual base salary less his 1999 MEP waiver ($322,000)
multiplied by a fraction, the numerator of which is the number of unused accrued
vacation days (30), and the denominator of which is 260. On the Separation Date,
Pinacor will pay Executive Thirty Seven Thousand One Hundred Fifty-Four Dollars
and 40/100 ($37,154.40) for these accrued unused vacation days.
3. REIMBURSABLE EXPENSES. Pinacor will, in accordance with standard
policies, reimburse Executive for all reasonable travel and other expenses
incurred by Executive prior to the Separation Date and submitted for
reimbursement on or before July 15, 1999.
4. MEDICAL AND DENTAL PLANS. In consideration of the benefits paid to
Executive pursuant to this Agreement, and notwithstanding anything contained in
Section 4.3(g) of the Employment Agreement to the contrary, Executive hereby
waives his right to receive medical, dental or other benefits under Section
4.3(g) of the Employment Agreement. As of the Separation Date, Pinacor will
cease making contributions to the monthly premiums it made while Executive was
an active Pinacor associate. Executive will be entitled to 18 months of COBRA
coverage (through December 31, 2000) (the "COBRA PERIOD"). Executive will be
required to pay the full COBRA premium in order to continue medical and/or
dental benefits during the COBRA Period.
Any questions regarding COBRA coverage should be directed to Xxxxx Xxxx at
366-3014. This Section 4 shall be deemed to be an amendment to the Employment
Agreement.
5. 401(K) PLAN AND SUPPLEMENTAL SAVINGS PLAN. Executive participates in the
Pinacor Retirement Savings Plan (the "401(K) PLAN") and the Pinacor Executive
Supplemental Savings Plan (the "SUPPLEMENTAL SAVINGS PLAN"). Executive has
received information regarding his options under the 401(k) Plan. Any questions
regarding the 401(k) Plan should be directed to Xxxxxxxx Xxxxxxx at 366-2287. As
of the Separation Date, no additional contributions will be made to the 401(k)
Plan or the Supplemental Savings Plan. Pursuant to the Participation Agreement
dated September 15, 1997, Executive's account balance under the Supplemental
Savings Plan will be distributed to him in a lump sum payment within a
reasonable time after the Separation Date.
A-1
6. SPLIT-DOLLAR INSURANCE AGREEMENT. Executive and MicroAge entered into
two Split- Dollar Insurance Agreements, dated as of September 1, 1995 and
January 27, 1997 (the "SPLIT- DOLLAR AGREEMENTS"). Attached as EXHIBIT D are the
amendments to the Split-Dollar Agreements assigning such agreements from
MicroAge to Pinacor as of the Separation Date. Pinacor has paid the premium
payments on both Policies (as such term is defined in each Split-Dollar
Agreement) through August 24, 1999. On the Separation Date, Pinacor will
transfer the Policies to Executive and will release Executive from any and all
obligations to reimburse Pinacor for premiums paid on the Policies. After August
24, 1999, Executive will be responsible for maintaining the Policies to the
extent Executive elects to do so. Pinacor and Executive will enter into
amendments to the Split-Dollar Agreements to effectuate the terms of this
Section 6.
7. DISABILITY INSURANCE. Executive currently has disability insurance
pursuant to separate policies: (1) the UNUM Group Disability Policy (the "GROUP
POLICY") and (2) two UNUM Individual Disability Policies (the "INDIVIDUAL
POLICIES"). The Group Policy will terminate as of the Separation Date. Pinacor
will cause the Individual Policies to remain in full force and effect until
September 30, 1999. After September 30, 1999, Executive will be responsible for
the full premium payments if Executive wishes to continue coverage under the
Individual Policies. If Executive elects to continue coverage under the
Individual Polices, Executive should contact Xxxxx Xxxxxx-Xxxxxx (955-7370) on
or before September 1, 1999.
8. STOCK OPTIONS. During Executive's employment Executive was granted the
following stock options:
A. Pursuant to a Letter Award, dated May 15, 1995 (the "LETTER
AWARD"), under the MicroAge, Inc. 1994 Long-Term Incentive Plan, Executive
was granted the option to purchase a total of 15,000 shares of MicroAge
common stock, par value $.01 per share ("COMMON STOCK"), at an exercise
price of $11.13 per share. Pursuant to the terms of the Letter Award, on or
before the Separation Date, Executive is entitled to purchase up to 9,000
shares of Common Stock at an exercise price of $11.13 per share. In
accordance with the terms of the Letter Award, all options thereunder will
terminate on the Separation Date.
B. Pursuant to the 1994 Stock Option Plan Grant Letter, dated as of
December 13, 1995 (the "1994 GRANT LETTER"), Executive was granted the
option to purchase a total of 15,000 shares of Common Stock at an exercise
price of $8.75 per share. Pursuant to the terms of the 1994 Grant Letter,
on or before the Separation Date, Executive is entitled to purchase up to
6,000 shares of Common Stock at an exercise price of $8.75 per share. In
accordance with the terms of the 1994 Grant Letter, all options thereunder
will terminate on the Separation Date.
C. Pursuant to the MicroAge, Inc. Long-Term Incentive Plan Incentive
Stock Option Award, dated March 14, 1996 (the "1996 LETTER"), Executive was
granted the option to purchase 50,000 shares of Common Stock at an exercise
price of $9.25 per share.
A-2
Pursuant to the terms of the 1996 Letter, on or before the Separation Date,
Executive is entitled to purchase up to 30,000 shares of Common Stock at an
exercise price of $9.25 per share. In accordance with the terms of the 1996
Letter, all options thereunder will terminate on the Separation Date.
D. Pursuant to the 1994 Long-Term Incentive Plan Incentive Stock
Option Award (the "1994 INCENTIVE AWARD"), on December 4, 1996 Executive
was granted the option to purchase a total of 20,000 shares of Common Stock
at an exercise price of $24.00 per share. Pursuant to the terms of the 1994
Incentive Plan, on or before the Separation Date, Executive is entitled to
purchase up to 8,000 shares of Common Stock at an exercise price of $24.00
per share. In accordance with the terms of the 1994 Incentive Award, all
options thereunder will terminate on the Separation Date.
E. Pursuant to the 1997 Long Term Incentive Plan Incentive Stock
Option Award, dated April 10, 1998 (the "1998 LETTER"), Executive was
granted the option to purchase a total of 10,000 shares of Common Stock at
an exercise price of $14.375 per share. Pursuant to the terms of the 1998
Letter, on or before the Separation Date, Executive is entitled to purchase
up to 2,000 shares of Common Stock at an exercise price of $14.375 per
share, subject to certain stock price hurdles. In accordance with the terms
of the 1998 Letter, all options thereunder will terminate on the Separation
Date.
F. Pursuant to the 1997 Long-Term Incentive Plan Incentive Stock
Option Award, dated January 28, 1999 (the "1999 LETTER"), Executive was
granted the option to purchase 10,000 shares of Common Stock at an exercise
price of $16.56 per share. As of the Separation Date, Executive is not
entitled to exercise any of the options under the 1999 Letter. In
accordance with the terms of the 1999 Letter, all options thereunder will
terminate on the Separation Date.
9. MANAGEMENT EQUITY PROGRAMS.
A. Pursuant to the 1997 Management Equity Program Award Agreement,
dated October 11, 1996, and amended January 28, 1999 (the "1997 MEP
AGREEMENT"), Executive received 135,035 options as a result of his election
to restructure his compensation package by reducing his fiscal year 1997,
1998, and 1999 compensation. As of the Separation Date, Executive will not
have any vested options. In accordance with the terms of the 1997 MEP
Agreement, following the Separation Date, Executive's options will continue
to vest under the vesting schedule set forth on EXHIBIT E.
B. Pursuant to the 1999 Management Equity Program Award Agreement
dated April 22, 1999 (the "1999 MEP AGREEMENT"), Executive received 32,681
options as a result of his election to waive a portion of his salary during
the period from May 1, 1999 through May 1, 2000. In accordance with the
terms of the 1999 MEP Agreement, on the Separation Date, Executive will
A-3
have 5,447 options. Following the Separation Date, Executive's options will
continue to vest under the vesting schedule set forth on EXHIBIT E.
10. ASSOCIATE STOCK PURCHASE PLAN. On June 30, 1999, Executive's balance in
the Associate Stock Purchase Plan (the "ASSP") will be invested in MicroAge
common stock pursuant to the terms of such plan. Any questions regarding the
ASSP should be directed to Xxxxxxxx Xxxxxxx at 366-2287.
11. EXTENSION OF OPTIONS. Pursuant to a written consent dated as of June
16, 1999, the Compensation Committee extended the exercise period of all options
granted in Section 8, paragraphs A-F above, for six (6) months after the
Separation Date.
12. PRODUCT PURCHASE BENEFITS. Executive may purchase the palm top,
personal computer and docking station Executive has been using during his
employment with Pinacor at a price equal to their depreciated book values. If
Executive elects to purchase such items, Executive will contact Xxxx XxXxxxxx.
13. CELLULAR PHONE. Executive may retain the cellular phone he was using
during his employment with Pinacor. As of the Separation Date, Pinacor will
transfer the cellular phone and the related account to Executive and Executive
will be responsible for maintaining such account.
14. EMPLOYMENT REFERENCE. Pinacor agrees to provide a reference and reason
for Executive's separation that is consistent with a statement that will be
mutually agreed to by Pinacor and Executive.
A-4
EXHIBIT B
June 30, 1999
To the Board of Directors of each of the corporations attached hereto as EXHIBIT
A:
I hereby resign my positions as a director and officer of each of the
corporations attached hereto as EXHIBIT A, effective as of June 30, 1999.
Sincerely,
Xxxxxx X. X'Xxxxxx
B-1
EXHIBIT A
COMPANY POSITION
------- --------
Complete Distribution, Inc. Director and Chief Executive Officer
ConnectWorks, Inc. Director and Chief Executive Officer
Contract PC, Inc. Director and Chief Executive Officer
MicroRetailing, Inc. Director and Chief Executive Officer
Pinacor, Inc. Director and Chief Executive Officer
Pinacor Logistics Services, Inc. Director and Chief Executive Officer
B-2
EXHIBIT C
NON-REVOCATION
AS OF THE DATE SHOWN ON THIS FORM
By signing below, I hereby verify that I have chosen not to revoke my
agreement to, and execution of, the Agreement and General Release. My signature
confirms my renewed agreement to the terms of that Agreement, including the
release and waiver of any and all claims relating to my employment with the
Employer and its successors, assigns, and affiliated companies, and/or the
termination of that employment
/S/ XXXXXX X. X'XXXXXX JULY 9, 1999
--------------------------------------- -------------
Xxxxxx X. X'Xxxxxx* Date
*Do not sign, date, or return this document until eight (8) days after you sign
the Agreement and General Release. The signed and dated document should be
returned to Xxxxxxx X. Xxxxxx, Xxxxx & Xxxxxx L.L.P., Xxx Xxxxxxx Xxxxxx,
Xxxxxxx, Xxxxxxx 00000.
C-1
VERIFICATION
STATE OF ARIZONA )
) ss.
County of Maricopa )
On this ____ day of _____________, 1999, before me, the undersigned Notary
Public, personally appeared Xxxxxx X. X'Xxxxxx, known to me to be the person
whose name is subscribed to the within instrument, and acknowledged that he
executed the same for the purpose therein contained.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
----------------------------------------
Notary Public
My Commission Expires -----------------
C-2
EXHIBIT D
FIRST AMENDMENT TO THE
1995 SPLIT-DOLLAR INSURANCE AGREEMENT
BY AND BETWEEN
MICROAGE, INC. AND XXXXXX X. X'XXXXXX
This First Amendment to the 1995 Split-Dollar Insurance Agreement by and
between MICROAGE, INC., a Delaware corporation (hereinafter referred to as
"MicroAge"), PINACOR, INC., a Delaware corporation (hereinafter referred to as
"Pinacor"), and XXXXXX X. X'XXXXXX (hereinafter referred to as "Insured") is
effective as of the 30th day of June, 1999.
RECITALS
WHEREAS, MicroAge and Insured entered into a Split-Dollar Insurance
Agreement dated September 1, 1995 (hereinafter referred to as "Agreement") and a
Collateral Assignment Form dated September 1, 1995 (hereinafter referred to as
"CAF");
WHEREAS, the Agreement pertains to a policy of insurance on the life of
Insured issued by The Northwestern Mutual Life Insurance Company (hereinafter
referred to as "Insurer"), in the face amount of Seven Hundred Fifty Thousand
Dollars ($750,000), with policy number 13453221 (hereinafter referred as
"Policy"), as identified on Schedule A to the Agreement;
WHEREAS, MicroAge was required to pay certain premiums due on the Policy
pursuant to Article II of the Agreement, and Insured was deemed the owner of the
Policy;
WHEREAS, pursuant to the Agreement and the CAF, Insured assigned to
MicroAge a security interest in the Policy for the repayment of the premiums
paid by MicroAge to Insurer;
D-1
WHEREAS, pursuant to the Agreement MicroAge and Insured agreed to divide
the proceeds of the Policy into two parts in the event of the death of Insured,
with MicroAge receiving an amount equal to MicroAge's security interest in the
Policy, and Insured's designated beneficiary receiving the balance of the death
benefit;
WHEREAS, Pinacor is a subsidiary of MicroAge, and both Pinacor and MicroAge
desire that MicroAge's interest and obligations under the Agreement be assigned
to Pinacor, and Insured agrees to such assignment;
The parties, therefore, in consideration of the mutual promises contained
herein, hereby agree as follows:
AGREEMENTS
1. ASSIGNMENT BY MICROAGE. MicroAge hereby assigns to Pinacor any and all
of its right, title, and interest in the Policy, any and all of its interest
acquired under the CAF, and any and all of its duties and obligations under the
Agreement.
2. ASSUMPTION BY PINACOR. Pinacor hereby assumes any and all of MicroAge's
right, title and interest in the Policy, and any and all of MicroAge's duties
and obligations under the Agreement, including but not limited to the obligation
to pay the premiums due on the Policy, and agrees to perform the Agreement in
the same manner and to the same extent that MicroAge would be required to
perform if no such assignment had taken place.
3. INDEMNIFICATION BY PINACOR. Pinacor agrees to defend, indemnify and hold
MicroAge harmless from and against any claims, losses or liability which arise
from the Agreement or this First Amendment to the Split-Dollar Insurance
Agreement (hereinafter referred to as "Amendment"), or from Pinacor's exercise
of its duties and responsibilities under the Agreement or the Amendment,
D-2
including but not limited to claims of Insured, or losses or liability resulting
therefrom. Pinacor also agrees to pay or reimburse MicroAge for any and all
costs, damages or losses including without limitation any out-of-pocket expenses
and reasonable attorneys' fees incurred in the investigation or defense of any
such claims.
4. CONSENT OF INSURED. Insured hereby consents to the assignment by
MicroAge and the assumption by Pinacor of any and all of MicroAge's right, title
and interest in the Policy, and any and all duties and obligations arising from
the Agreement.
5. RELEASE BY INSURED. Insured releases, on behalf of himself and his
heirs, executors, administrators and assigns, any and all claims of any nature
whatsoever against MicroAge and its affiliates, agents, officers, owners,
directors, employees, insurers and assigns, arising out of or related in any
manner whatsoever to the Policy, the Agreement, the Amendment, and/or the CAF,
and MicroAge's acts or omissions in connection therewith. The foregoing release
does not extend to or include Pinacor.
6. COLLATERAL ASSIGNMENT FORM. Insured agrees to execute and deliver to
Pinacor and Insurer a Collateral Assignment Form in connection with the
execution of this Amendment, establishing Pinacor as the direct beneficiary of
the Policy in an amount equal to the total amount of premiums paid to Insurer on
the Policy, whether paid by Pinacor or MicroAge.
D-3
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment
as of the ___ day of June, 1999.
MICROAGE, INC., a Delaware Corporation
By
--------------------------------------
Its
-------------------------------------
PINACOR, INC., a Delaware Corporation
By
--------------------------------------
Its
-------------------------------------
By
--------------------------------------
XXXXXX X. X'XXXXXX
D-4
FIRST AMENDMENT TO THE
1997 SPLIT-DOLLAR INSURANCE AGREEMENT
BY AND BETWEEN
MICROAGE, INC. AND XXXXXX X. X'XXXXXX
This First Amendment to the 1997 Split-Dollar Insurance Agreement by and
between MICROAGE, INC., a Delaware corporation (hereinafter referred to as
"MicroAge"), PINACOR, INC., a Delaware corporation (hereinafter referred to as
"Pinacor"), and XXXXXX X. X'XXXXXX (hereinafter referred to as "Insured") is
effective as of the 30th day of June, 1999.
RECITALS
WHEREAS, MicroAge and Insured entered into a Split-Dollar Insurance
Agreement dated January 27, 1997 (hereinafter referred to as "Agreement") and a
Collateral Assignment Form dated January 27, 1997 (hereinafter referred to as
"CAF");
WHEREAS, the Agreement pertains to a policy of insurance on the life of
Insured issued by The Northwestern Mutual Life Insurance Company (hereinafter
referred to as "Insurer"), in the face amount of Two Hundred Fifty Thousand
Dollars ($250,000), with policy number 14016898 (hereinafter referred as
"Policy"), as identified on Schedule A to the Agreement;
WHEREAS, MicroAge was required to pay certain premiums due on the Policy
pursuant to Article II of the Agreement, and Insured was deemed the owner of the
Policy;
WHEREAS, pursuant to the Agreement and the CAF, Insured assigned to
MicroAge a security interest in the Policy for the repayment of the premiums
paid by MicroAge to Insurer;
WHEREAS, pursuant to the Agreement MicroAge and Insured agreed to divide
the proceeds of the Policy into two parts in the event of the death of Insured,
with MicroAge receiving an amount equal to MicroAge's security interest in the
Policy, and Insured's designated beneficiary receiving the balance of the death
benefit;
D-5
WHEREAS, Pinacor is a subsidiary of MicroAge, and both Pinacor and MicroAge
desire that MicroAge's interest and obligations under the Agreement be assigned
to Pinacor, and Insured agrees to such assignment;
The parties, therefore, in consideration of the mutual promises contained
herein, hereby agree as follows:
AGREEMENTS
1. ASSIGNMENT BY MICROAGE. MicroAge hereby assigns to Pinacor any and all
of its right, title, and interest in the Policy, any and all of its interest
acquired under the CAF, and any and all of its duties and obligations under the
Agreement.
2. ASSUMPTION BY PINACOR. Pinacor hereby assumes any and all of MicroAge's
right, title and interest in the Policy, and any and all of MicroAge's duties
and obligations under the Agreement, including but not limited to the obligation
to pay the premiums due on the Policy, and agrees to perform the Agreement in
the same manner and to the same extent that MicroAge would be required to
perform if no such assignment had taken place.
3. INDEMNIFICATION BY PINACOR. Pinacor agrees to defend, indemnify and hold
MicroAge harmless from and against any claims, losses or liability which arise
from the Agreement or this First Amendment to the Split-Dollar Insurance
Agreement (hereinafter referred to as "Amendment"), or from Pinacor's exercise
of its duties and responsibilities under the Agreement or the Amendment,
including but not limited to claims of Insured, or losses or liability resulting
therefrom. Pinacor also agrees to pay or reimburse MicroAge for any and all
costs, damages or losses including without limitation any out-of-pocket expenses
and reasonable attorneys' fees incurred in the investigation or defense of any
such claims.
D-6
4. CONSENT OF INSURED. Insured hereby consents to the assignment by
MicroAge and the assumption by Pinacor of any and all of MicroAge's right, title
and interest in the Policy, and any and all duties and obligations arising from
the Agreement.
5. RELEASE BY INSURED. Insured releases, on behalf of himself and his
heirs, executors, administrators and assigns, any and all claims of any nature
whatsoever against MicroAge and its affiliates, agents, officers, owners,
directors, employees, insurers and assigns, arising out of or related in any
manner whatsoever to the Policy, the Agreement, the Amendment, and/or the CAF,
and MicroAge's acts or omissions in connection therewith. The foregoing release
does not extend to or include Pinacor.
6. COLLATERAL ASSIGNMENT FORM. Insured agrees to execute and deliver to
Pinacor and Insurer a Collateral Assignment Form in connection with the
execution of this Amendment, establishing Pinacor as the direct beneficiary of
the Policy in an amount equal to the total amount of premiums paid to Insurer on
the Policy, whether paid by Pinacor or MicroAge.
D-7
IN WITNESS WHEREOF, the parties hereto have executed this First Amendment
as of the ___ day of June, 1999. MICROAGE, INC., a Delaware Corporation
MICROAGE, INC., a Delaware Corporation
By
--------------------------------------
Its
-------------------------------------
PINACOR, INC., a Delaware Corporation
By
--------------------------------------
Its
-------------------------------------
By
--------------------------------------
XXXXXX X. X'XXXXXX
D-8
EXHIBIT E
1997 MEP AGREEMENT VESTING SCHEDULE
1/3 1/3 1/3
--- --- ---
November 1, 1999 14,563
October 30, 2000 14,563 14,563
October 29, 2001 14,562 14,563 15,887
November 4, 2002 14,562 15,886
November 3, 2003 15,886
------ ------ ------
43,688 43,688 47,659
TOTAL 135,035
1999 MEP AGREEMENT VESTING SCHEDULE
1/3
---
May 1, 2000 1,816
May 1, 2001 1,816
May 1, 2002 1,815
-----
5,447
E-1
