EXHIBIT 10.3
SEPARATION AGREEMENT
This Separation Agreement ("Agreement") is entered into as of this day of
October, 2002, among XXXXXXX & XXXXXX CORPORATION and any successors thereto
(collectively, the "Company") and Xxxxxxxx Xxxxxxx (the "Executive").
The Executive and the Company agree as follows:
1. Separation. The employment relationship between the Executive and
the Company terminated on July 30, 2002 (the "Termination Date").
Effective as of the Termination Date, the Executive's employment was
terminated as (i) Senior Vice President and Treasurer of the Company
and (ii) all other officer, director, committee member and employee
positions with the Company and its subsidiaries.
2. Payments. Prior to the date of this Agreement, the Company has paid
Executive for services rendered through the Termination Date and has
paid Executive's salary and benefits as set forth in this Section 2
from the Termination Date to and including September 11, 2002. The
Company and the Executive hereby agree:
(i) that the Executive is entitled to receive:
(a) $60,000, payable to Executive on the first
business day following the expiration of the
Revocation Period (as defined in Section 11);
(b) $9,615.40, representing Executive's salary for
the period from September 12, 2002 to and including
September 30, 2002 and $1853.22, representing payment
for perquisites for the period from September 12,
2002 to and including September 30, 2002, payable to
Executive on the first business day following the
expiration of the Revocation Period;
(c) $3846.15, representing payment for four days of
accrued and unused vacation time, payable to
Executive on the first business day following the
expiration of the Revocation Period; and
(d) Executive's accrued and vested benefits under the
employee benefit plans of the Company set forth on
Schedule A hereto in accordance with the terms of
such plans (it being acknowledged that the Company is
under no obligation to make any further contribution
to any such plan on behalf of the Executive except to
the extent that the Executive elects to have a
portion of the sums otherwise payable to the
Executive pursuant to clause (iii)(a) below
contributed to the Xxxxxxx & Xxxxxx
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Shadow Retirement Income Benefits Plan in accordance
with the terms of such plan (it being understood that
the Company shall not be obligated to provide any
matching or similar contribution as a result of any
such election by the Executive));
(ii) that the Executive's stock options that have vested prior
to the Termination Date may be exercised at any time on or
prior to the date which is 90 days after the Termination Date,
after which time all such options shall expire and be of no
further force and effect and that Executive's stock options
that had not vested prior to the Termination Date expired on
the Termination Date; and
(iii) subject to Executive's compliance with Sections 5 and 6
hereof, the Company shall:
(a) pay to Executive during the period from and
including October 1, 2002 to and including July 30,
2004, $20,833.33 per month (prorated in the case of
the partial month period), representing Executive's
base salary as in effect on the Termination Date on a
periodic basis in accordance with the Company's
normal pay practices as may be in effect from time to
time, commencing with the first payroll payment date
following the expiration of the Revocation Period;
(b) make available to Executive until the earlier of
(x) the expiration of 24 months from the Termination
Date (the period from the Termination date until the
expiration of 24 months thereafter being referred to
as the "Restricted Period") and (y) the date on which
Executive commences employment for any other
employer, the benefits set forth on Schedule B hereto
in the amounts and of the types and on the same basis
as were provided to Executive on the Termination Date
(or substantially equivalent benefits); provided that
Executive may continue to participate in such
employee benefit plans for up to 90 days following
commencement of such employment, if, and only to the
extent that, the employee benefit plans of such
employer generally require that new employees be
employed for such period in order to be eligible to
participate in such benefit plans; provided further
that during the 18 month period following the
Termination Date, Executive may continue
participation in such employee benefit plans as
required under Section 4980B of the Internal Revenue
Code of 1986, as amended (with the cost of such
participation to be paid by Executive in accordance
with such Section);
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(c) make available to Executive from October 1, 2002
until the earlier of (x) the end of the Restricted
Period and (y) the date on which Executive commences
employment for any other employer (I) $2,500 per
month for perquisites, grossed up for taxes in a
manner consistent with the practice of the Company
prior to the Termination Date, payable to Executive
on a periodic basis at the times payments pursuant to
clause (iii)(a) above are made and (II) the benefits
set forth on Schedule C hereto in the amounts and of
the types and on the same basis as were provided to
Executive on the Termination Date (or substantially
equivalent benefits); and
(d) for a period of 12 months from the Termination
Date (or if shorter, until Executive commences
employment for any other employer), to make available
to Executive outplacement services under the
Executive Outplacement Program of Drake Beam & Xxxxx.
3. Release. In consideration of the above, the sufficiency of which the
Executive hereby acknowledges, the Executive, on behalf of the Executive and the
Executive's heirs, executors and assigns hereby releases and forever discharges
the Company and its members, shareholders, parents, affiliates, subsidiaries,
divisions, any and all current and former directors, officers, employees,
agents, and contractors and their heirs and assigns, and any and all employee
pension benefit or welfare benefit plans of the Company, including current and
former trustees and administrators of such employee pension benefit and welfare
benefit plans, from all claims, charges, or demands, in law or in equity,
whether known or unknown, which may have existed or which may now exist from the
beginning of time to the date of this Agreement, including, without limitation,
any claims the Executive may have arising from or relating to the Executive's
employment or termination from employment with the Company, including a release
of any rights or claims the Executive may have under Title VII of the Civil
Rights Act of 1964, as amended, and the Civil Rights Act of 1991 (which prohibit
discrimination in employment based upon race, color, sex, religion and national
origin); the Americans with Disabilities Act of 1990, as amended, and the
Rehabilitation Act of 1973 (which prohibit discrimination based upon
disability); the Family and Medical Leave Act of 1993 (which prohibits
discrimination based on requesting or taking a family or medical leave); Section
1981 of the Civil Rights Act of 1866 (which prohibits discrimination based upon
race); Section 1985(3) of the Civil Rights Act of 1871 (which prohibits
conspiracies to discriminate); the Employee Retirement Income Security Act of
1974, as amended; any other federal, state or local laws against discrimination;
or any other federal, state, or local statute, or common law relating to
employment, wages, hours, or any other terms and conditions of employment. This
includes a release by the Executive of any
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claims for wrongful discharge, breach of contract, torts or any other claims in
any way related to the Executive's employment with or resignation or termination
from the Company, including any claim under any written or oral understandings
relating to employment. This release also includes a release of any claims for
age discrimination under the Age Discrimination in Employment Act, as amended
("ADEA"). The ADEA requires that the Executive be advised to consult with an
attorney before the Executive waives any claim under ADEA and Executive
acknowledges that he has consulted with an attorney with respect to such waiver.
In addition, the ADEA provides the Executive with at least 21 days to decide
whether to waive claims under ADEA and seven days after the Executive signs the
Agreement to revoke that waiver. This release does not release the Company from
any obligations due to the Executive under this Agreement. This Agreement is not
an admission by either the Executive or the Company of any wrongdoing or
liability.
4. Acknowledgment of No Reinstatement. The Executive understands and agrees that
the consideration provided for herein is more than (and in lieu of) that which
the Executive would otherwise be entitled to under the Company's existing plans
and policies or otherwise. The Executive waives any right to reinstatement or
future employment with the Company following the Executive's separation from the
Company on the Termination Date.
5. Non-Disparagement. The Executive agrees not to make any oral or written
statements or otherwise take any action that is intended or may reasonably be
expected to disparage the reputation, business, prospects or operations of the
Company, its affiliates, officers, directors, stockholders or employees or any
persons related to the foregoing and the Company agrees that it will not, and
will use all reasonable efforts to cause its affiliates, officers directors,
stockholders and employees not to, make any oral or written statements or
otherwise take any action that is intended or may reasonably be expected to
disparage the reputation of Executive.
6. Confidentiality; Non-Competition; Etc. (a) The Executive agrees that the
Executive will keep confidential all confidential information and trade secrets
of the Company or any of its subsidiaries or affiliates and will not disclose
such information to any person without prior approval of the Board of Directors
of the Company or use such information for any purpose. It is understood that
for purposes of this Agreement the term "confidential information" is to be
construed broadly to include all material nonpublic or proprietary information.
The Executive shall promptly return any documents, records, data, books or
materials of the Company or its subsidiaries or affiliates in his possession or
control and any of his workpapers containing confidential information or trade
secrets of the Company or its subsidiaries or affiliates.
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(b) The Executive agrees that from the date hereof through the
end of the Restricted Period and so long as the Company is not in
material breach of any continuing payment obligation owed to the
Executive pursuant to Section 2 hereof, the Executive shall not,
directly or indirectly (whether for compensation or otherwise), as an
agent, principal, partner, employee, officer, director, trustee,
consultant, shareholder, or in any other capacity, own, manage,
operate, join, control, directly render services for, or participate in
the ownership, management or operation or control of any of the
Competing Businesses (as defined below); provided, however, that
notwithstanding the foregoing, nothing contained in this Agreement
shall be deemed to preclude the Executive from owning not more than 2%
of the publicly traded securities of any Competing Business. The
"Competing Businesses" shall mean any business listed on Schedule D
hereto conducted by any company listed beneath such business (and any
successors to any such company with respect to such business).
(c) The Executive acknowledges that the agreements and
covenants contained in this Section are essential to protect the value
of the Company's and its subsidiaries' business and assets and by
virtue of his employment with the Company, the Executive has obtained
knowledge, contacts, know-how, training, experience and other
information relating to the Company's and its subsidiaries' business
operations, and there is a substantial probability that such knowledge,
know-how, contacts, training, experience and information could be used
to the substantial advantage of a competitor of the Company and its
subsidiaries and to the Company's and its subsidiaries' substantial
detriment. Accordingly, for a period commencing on the date hereof and
ending on the calendar following the last day of the Restricted Period,
the Executive shall not, directly or indirectly, for himself or on
behalf of or in conjunction with any person, partnership, corporation
or other entity, interfere with or disrupt, or attempt to interfere
with or disrupt, the relationship, contractual or otherwise, between
the Company or any of its subsidiaries and any customer, client,
supplier, distributor or agent of the Company or any of its
subsidiaries.
(d) Executive covenants and agrees that he will not during the
Restricted Period, (i) solicit, employ or otherwise engage as an
employee, independent contractor or otherwise, any person who is or was
an employee of the Company or any of its subsidiaries or affiliates at
any time during the 24 month period immediately preceding the
Termination Date, (ii) induce or attempt to induce any employee of the
Company or any of its subsidiaries or affiliates to terminate such
employment or (iii) interfere with the relationship of the Company or
any of its subsidiaries of affiliates with any person, including any
person who, at any time during the 24 month period immediately
preceding the Termination Date, was an employee, contractor, supplier
or customer of the Company or any of its subsidiaries or affiliates.
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(e) It is the desire and intent of the parties that the
provisions of this Section shall be enforced to the fullest extent
permissible under the laws and public policies applied in each
jurisdiction in which enforcement is sought. Accordingly, if any
particular portion of this Section shall be adjudicated to be invalid
or unenforceable, this Section shall be deemed amended to delete
therefrom the portion thus adjudicated to be invalid or unenforceable,
such deletion to apply only with respect to the operation of this
Section in the particular jurisdiction in which such adjudication is
made. The Executive agrees that he will execute any and all documents
which are reasonably necessary to effectuate the provisions of this
Section.
(f) If there is a breach or threatened breach by the Executive
of the provisions of this Agreement, the Company or its affiliates
shall be entitled, without the requirement to post a bond, to an
injunction restraining the Executive from such breach. Nothing herein
shall be construed as prohibiting the Company from pursuing any other
remedies for such breach or threatened breach.
7. Cooperation; Reimbursement. The Executive shall, at the request of the
Company, reasonably assist and cooperate with the Company in the defense and/or
investigation of any third party claim or any investigation or proceeding,
whether actual or threatened, including, without limitation, participating as a
witness in any litigation, arbitration, hearing or other proceeding between the
Company and a third party or any government body. The Company shall reimburse
the Executive for all reasonable expenses incurred by him in connection with
such assistance including, without limitation, travel expenses.
8. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Michigan, without reference to the
principles of conflict of laws.
9. Withholding. All payments to be made hereunder shall be net of all applicable
income and employment taxes required to be withheld therefrom.
10. Complete Agreement. This Agreement represents the complete agreement between
the Executive and the Company concerning the subject matter in this Agreement
and supersedes all prior agreements or understandings, written or oral. Any oral
or written understandings concerning the Executive's employment are hereby
terminated as of the date of such agreements as if such agreements had never
been executed, including any agreements with stated effect after termination
including, without limitation, the Severance Benefits Agreement, dated as of
April 5, 2002, by and among the Executive and the Company. This Agreement may
not be amended or modified otherwise than by a written agreement executed by the
parties hereto or their respective successors and legal representatives.
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11. Voluntary Agreement. This Agreement has been entered into voluntarily and
not as a result of coercion, duress, or undue influence. The Executive
acknowledges that the Executive has read and fully understands the terms of this
Agreement and has been advised to consult with an attorney before executing this
Agreement. Additionally, the Executive hereby acknowledges and waives the
opportunity of at least 21 days to consider this Agreement. It is further
understood that for a period of 7 days following the execution of this Agreement
(the "Revocation Period"), the Executive may revoke this Agreement, and this
Agreement shall not become effective or enforceable until the Revocation Period
has expired. No revocation of this Agreement by the Executive shall be effective
unless the Company has received, within the Revocation Period, written notice of
any revocation.
12. Successors and Assigns. The Company will require any successor or assignee,
whether direct or indirect, by purchase, merger, consolidation or otherwise, of
all, or substantially all, of the business and/or assets of the Company to
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if such succession or
assignment had not taken place. This Agreement shall inure to the benefit of and
be binding on the Executive's personal and legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.
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The parties to this Agreement have executed this Agreement as of the day and
year first written above.
XXXXXXX & XXXXXX CORPORATION
By:
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Name:
Title:
EXECUTIVE
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Name: Xxxxxxxx Xxxxxxx
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SCHEDULE A
(i) Xxxxxxx & Xxxxxx Shadow Retirement Income Benefits Plan
(ii) Xxxxxxx & Xxxxxx Personal Savings Plan (401(k) Plan)
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SCHEDULE B
(i) Unicare PPO Medical -- Family coverage
(ii) Unicare Optional Dental -- Family coverage
(iii) Unicare Vision -- Family coverage
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SCHEDULE C
(i) Reimbursement of up to $7500 per year in accordance with the Company's
Executive Medical Plan
(ii) Basic Life Insurance
(iii) Basic Accidental Death & Dismemberment Insurance
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SCHEDULE D
AUTOMOTIVE FABRIC BUSINESS INTERIOR TRIM & EXTERIOR TRIM BUSINESS
-------------------------- --------------------------------------
Chatham Borgstena ArvinMeritor
Xxxxxxxx Xxxxx Inc. Acsys Technologies
Xxxxxxxx & Company Xxxxxx
Xxxxxx Automotive
CARPET & ACOUSTIC SYSTEMS BUSINESS Faurecia
---------------------------------- Findlay Industries
H.P. Xxxxxx (Automotive System) Foamex International Inc.
Xxxxxxxxxxx NOK GE Plastics
Xxxxx Carpet Inc. Guardian Automotive
Peguform Intier Automotive Inc.
Rieter Automotive Systems Xxxxxxx Controls Inc.
TG North America Key Plastics L.L.C.
The Woodbridge Group LDM Technologies
Xxxx Corporation
OPEN ROOF SYSTEMS BUSINESS Venture Plastics Inc.
-------------------------- Ventra Group Inc.
Edscha USA Inc. Visteon Corporation
Illbruck Automotive
American Sun Roof
Webasto ELECTRONICS
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Valeo
