AGREEMENT AND GENERAL RELEASE
Exhibit
10.24
AGREEMENT
AND GENERAL RELEASE
This
Agreement and General Release (“Agreement”) is made and entered into this
18th day of
October 2004 by and between Xxxxx Xxxxxxxxx (“Xxxxxxxxx”) and Maverick Tube
Corporation (“Maverick”), herein collectively referred to as the
“Parties.”
Recitals
X. Xxxxxxxxx
has served as the Chairman of the Board of Directors (“Board”) of Maverick and
has been employed by Maverick as its President and Chief Executive
Officer.
X. Xxxxxxxxx
has decided to retire from Maverick and, in conjunction with that retirement,
has resigned his position as President and Chief Executive Officer and has
resigned from all other offices held by him in Maverick and any of its
subsidiaries (the “Retirement”).
C. In order
to provide for an orderly transition in the management of Maverick as a result
of Xxxxxxxxx’x Retirement, Xxxxxxxxx, who has resigned from his position as
Chairman of the Board effective December 31, 2004, will thereafter serve
Maverick in a consulting relationship under the terms and conditions set forth
in this Agreement.
D. The
Parties acknowledge and agree that the restrictive covenants contained within
this Agreement were specifically intended and agreed to by the Parties, that
those covenants are reasonable and necessary to protect and preserve Maverick’s
legitimate business interests, that those covenants are reasonable as to their
duration and scope, that any violation of those covenants would result in
immediate, irreparable harm
to
Maverick, and that the enforcement of those covenants through injunctive relief
or other means would not prevent Xxxxxxxxx from earning a
livelihood.
NOW,
THEREFORE, in consideration of the mutual promises, covenants and agreements
contained within this Agreement, the adequacy and sufficiency of which are
hereby acknowledged and confessed, the Parties hereby agree as
follows:
1. Announcement
of Retirement.
Xxxxxxxxx has submitted his resignation from his positions as President and
Chief Executive Officer and from all other offices held by him in Maverick and
any of its subsidiaries, other than as a director of Maverick (“Resignation”).
Maverick will inform the public of the Retirement and its plan for succession in
a press release that is expected to be issued following the close of the stock
market on October 18, 2004. A copy of the relevant portion of the press release
relating to this announcement is attached to this Agreement as Exhibit A. Except
to the extent required by law or to the extent dictated by a material change in
circumstances, as determined by Maverick, any subsequent press releases issued
by Maverick regarding the reasons for Xxxxxxxxx’x Retirement shall be
substantially consistent with the contents of Exhibit X. Xxxxxxxxx shall
cooperate with Maverick in the announcement of his Retirement, including but not
limited to participating as directed by Maverick in a telephone conference call
on October 19, 2004.
2. Cessation
of Duties.
Xxxxxxxxx’x resignation from his positions as President and Chief Executive
Officer and from all other offices held by him in Maverick and any of its
subsidiaries became effective immediately upon the submission of his Resignation
(that is, October 15, 2004). Xxxxxxxxx, accordingly, has ceased performing any
and all duties related to those positions and offices immediately following his
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Resignation.
Xxxxxxxxx shall have no involvement in Maverick’s business except as directed by
Maverick and as a director of Maverick. Xxxxxxxxx’x Resignation included
Xxxxxxxxx’x resignation from his position as Chairman of the Board, which shall
be effective at the close of business on December 31, 2004.
3. Continuation
of Compensation and Other Benefits.
Notwithstanding his Resignation, Maverick shall (a) continue to pay Xxxxxxxxx
the base salary that he was earning immediately prior to his Resignation (less
any authorized deductions or other deductions required by law) and pay 100% of
the financial and non-financial bonuses to which Xxxxxxxxx would be entitled
under Maverick’s bonus plans had the Resignation not occurred (without regard to
whether any contingencies are met and without regard to whether all or a portion
of the bonus although earned in 2004 is not paid or payable until 2005) in
accordance with Maverick’s regular payroll practices through December 31, 2004,
(b) continue to allow Xxxxxxxxx to participate in its insurance and benefit
plans through December 31, 2004, and (c) allow Xxxxxxxxx to exercise, up through
December 31, 2005, all previously granted stock options that are or may become
exercisable prior to December 31, 2005. Maverick will continue to insure
Xxxxxxxxx under its director and officer liability insurance policy, as in
effect from time to time, throughout the period from January 1, 2005 through
December 31, 2007. In addition, if Xxxxxxxxx elects to continue his health
insurance coverage under the Consolidated Omnibus Budget Reconciliation Act
(“COBRA”) after December 31, 2004, Maverick shall pay Xxxxxxxxx’x portion of his
health insurance premiums under COBRA during the eighteen-month period from
January 1, 2005 through June 30, 2006.
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4. Consulting
Arrangement. During
the period from January 1, 2005 through December 31, 2005 (the “Consulting
Term”), Xxxxxxxxx shall serve as a consultant for Maverick. In that capacity,
Xxxxxxxxx shall be available telephonically or in person to answer questions and
advise Maverick’s Board and its officers, employees and agents on business
matters or issues raised by Maverick. In his capacity as a consultant, Xxxxxxxxx
shall not be deemed an employee or an agent of Maverick, but rather shall be
considered an independent contractor, and accordingly Xxxxxxxxx’x actions will
not be deemed binding upon Maverick under agency principles and, except as is
necessary to effectuate the terms of this Agreement, Xxxxxxxxx shall not be
eligible to participate in any plans or programs offered by Maverick to its
employees. As compensation for his consulting services, Maverick shall pay
Xxxxxxxxx the total fee of Seven Hundred Twenty Thousand Dollars ($720,000.00),
to be paid in equal, monthly installments over the calendar year 2005. Xxxxxxxxx
shall be solely responsible for the payment of all taxes due or arising from the
payment of this fee.
5. Non-Competition,
Non-solicitation and Confidentiality Agreement.
A. Throughout
the Consulting Term and throughout the one (1) year period immediately following
the termination of that consulting arrangement, Xxxxxxxxx shall not engage or
invest in, own, manage, operate, finance, control, or participate in the
ownership, management, operation, financing, or control of, be employed by,
consult for or with, obtain sales for, lend his name to, lend his credit to, or
render services or advice to, any business engaged in the manufacture, coating,
distribution, marketing or sale of OCTG, HSS, conduit, line pipe or coil tubing
markets within the United States or Canada. Xxxxxxxxx, however, is not precluded
by this paragraph from purchasing or
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otherwise
acquiring in the aggregate up to (but not more than) five percent (5%) of any
class of securities of any enterprise (but without otherwise participating in
the day to day operational activities of such enterprise) if such securities are
listed on any national or regional securities exchange or have been registered
under Section 12(g) of the Securities Exchange Act of
1934.
B. Non-Solicitation.
Throughout the Consulting Term and throughout the one (1) year period
immediately following the termination of that consulting arrangement, Xxxxxxxxx
shall not, without the prior written consent of Maverick, directly or
indirectly, either as an employee, employer, lender, owner, partner, member,
agent, principal, broker, advisor, consultant, manager, shareholder, director or
officer, or otherwise on Xxxxxxxxx’x behalf or on behalf of any person, firm,
partnership, entity or corporation, or by any agent of Xxxxxxxxx:
(a) solicit,
take away or attempt to take away the trade or patronage of, any customer,
supplier, licensee or business relation of Maverick; nor
(b) solicit
the services of, interfere with the employment or business relationship of,
employ or endeavor to employ any employee or agent of Maverick.
C. Confidential
Information.
Throughout
the Consulting Term, and at
all times subsequent to the termination of the Consulting Term, Xxxxxxxxx shall
not disclose to any Person (as hereinafter defined) or use for his own account
or for the benefit of any third party any Confidential Information of Maverick
(as hereinafter defined), whether or not such information is embodied in writing
or other physical form, without Maverick’s written consent, unless and to the
extent that (a) such disclosure is required by law, by an order of a court
having competent jurisdiction or under subpoena from a governmental agency, or
(b) the Confidential Information is or becomes generally known to and available
for use by the public other than as a result of the fault of the Xxxxxxxxx or
the fault of any other Person bound by a duty of confidentiality to Xxxxxxxxx.
For the purposes of this Agreement, the term “Person” shall refer to any
individual, partnership, corporation, limited liability company, association,
joint stock company, trust, joint venture, unincorporated organization or
government entity. The term “Confidential Information” as used in this Agreement
includes, but is not limited to:
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agency,
or (b) the Confidential Information is or becomes generally known to and
available for use by the public other than as a result of the fault of the
Xxxxxxxxx or the fault of any other Person bound by a duty of confidentiality to
Xxxxxxxxx. For the purposes of this Agreement, the term “Person” shall refer to
any individual, partnership, corporation, limited liability company,
association, joint stock company, trust, joint venture, unincorporated
organization or government entity. The term “Confidential Information” as used
in this Agreement includes, but is not limited to:
(a) any and
all trade secrets concerning the business and affairs of Maverick, that
constitutes a trade secrete within the meaning of applicable law, including by
way of illustration, data, know-how, formulae, compositions, processes, designs,
sketches, photographs, graphs, drawings, samples, inventions and ideas, past,
current and planned research and development, customer lists, current and
anticipated customer requirements, price lists, market studies, business plans,
database technologies, systems, structures, processes, improvements, devices,
discoveries, concepts and other such information, however documented, of
Maverick;
(b) any and
all information concerning the business and affairs of Maverick, including but
not limited to, historical financial statements, financial projections and
budgets, historical and projected sales, capital spending budgets and plans, the
names and backgrounds of key personnel, contractors, agents, suppliers and
potential suppliers, personnel training and techniques and materials, purchasing
methods and techniques, and any other information, however documented; that is
deemed the confidential or proprietary information of Maverick; and
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(c) any and
all notes, analysis, compilations, studies, summaries and other material
prepared by or for Maverick containing or based, in whole or in part, upon any
information included in the foregoing subparagraphs (a) and (b).
D. Consideration. As
separate consideration for Xxxxxxxxx’x agreements as set forth in this paragraph
5, Maverick shall pay Xxxxxxxxx the sum of Five Hundred Thousand Dollars
($500,000.00), to be paid during the Consulting Term in equal, monthly
installments.
E. Extension
of the Restrictive Covenants.
Maverick shall have the option of extending the restrictive covenants contained
in paragraph 5.A and 5.B. (Non-Competition Non-Solicitation) for a third year
(2007). To exercise that option, Maverick must inform Xxxxxxxxx in writing at
least 90 days prior to December 31, 2006 that the restrictive covenants will be
extended to December 31, 2007 and, as consideration for that extension, must pay
Xxxxxxxxx the sum of Two Hundred Fifty Thousand Dollars ($250,000.00), to be
paid in equal, monthly installments throughout the 2007 calendar year.
6. Non-Disparagement. During
the non-compete period, including any extensions thereof as provided in
paragraph 5 above (the “Non-Compete Period”), Xxxxxxxxx shall not engage, or
encourage others to engage, in any conversations, comments, critiques,
discussions, descriptions, or any other form of communication, whether oral or
written or direct or indirect, with any third person or entity or the public
generally that in any way disparages the character, integrity, honesty, hiring
and employment practices, professional abilities, professional reputation,
business practices, general reputation or business pursuits of Maverick or any
of Maverick’s past, present or
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future
employees, officers or directors.
7. Remedies
for Violations of Covenants.
(a) The
parties acknowledge and agree that, in the event of any violation or threatened
violation of the covenants contained in this Agreement, the party whose rights
are so violated or threatened shall be authorized and entitled to seek and
receive, from any court of competent jurisdiction:
| (i) |
temporary,
preliminary and permanent injunctive relief; |
| (ii) |
an
equitable accounting of all profits or benefits arising out of such
violation whether realized by the party or any other party which utilized
or benefited from the party’s services, directly or indirectly; and
|
| (iii) |
direct,
incidental, and consequential damages to the party arising from the
breach, which rights and remedies will be cumulative and in addition to
any other rights and remedies to which Maverick may be
entitled. |
(b) If any
party incurs expenses to retain attorneys, accountants or other experts to
enforce any of the covenants contained in this Agreement, the prevailing party
shall recover all such costs, court costs, fees and expenses of enforcement,
including actual fees of attorneys, accountants and experts.
(c) In order
to preserve Maverick’s rights under the non-compete provisions of this
agreement, during the Non-Compete Period, Maverick may advise any third party
who has contacted Xxxxxxxxx or who was contacted by Xxxxxxxxx to establish a
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relationship
that threatens a violation of the non-compete agreement of the existence of this
Agreement and of its terms and Maverick shall have no liability for so
doing.
8. No
Basis for Claims.
Xxxxxxxxx warrants and represents that there is no actual or impending suits,
claims or other actions against Maverick based upon, arising from or related to
any personal conduct on his part, nor is there any basis for any such suit,
claim or other action, other than actions or omissions within the business
judgment of Xxxxxxxxx while acting in the course and scope of this employment as
an officer or director of Maverick.
9. Release
of Claims by Xxxxxxxxx. In
consideration of the payments provided by this Agreement and the stipulations
and covenants made hereunder, Xxxxxxxxx, with the intent of binding himself and
his successors, heirs, assigns, attorneys, and family members, hereby releases
and forever discharges Maverick and its parents, affiliates, subsidiaries and
other related companies and each of their officers, directors, agents,
representatives and employees from and against any and all matters, claims,
charges, demands, causes of action, debts, liabilities, controversies, judgments
grievances and suits of every kind whatsoever, including any claims for actual
or punitive damages, costs and attorney fees, which first arose prior to and
through the date on which this Agreement is executed, including but not limited
to, any and all claims arising under or pursuant to the Employee
Retirement Income Security Act of 1974, as amended, 29 U.S.C. § 1001
et
seq.; Title
VII of the Civil Rights Act of 1964, as amended, 42 U.S.C., § 2000e et
seq.; the
Civil Rights Act of 1991, 42 U.S.C. § 1981(a) et
seq.; the
Americans with Disabilities Act of 1990, 42 U.S.C. § 12101 et
seq.; the
Missouri Human Rights Act, Mo. Rev. Stat. § 213.010 et
seq.; the
Missouri Service Letter Statute, Mo. Re. Stat. § 290.140,
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and any
and all other statutes or ordinances, any and all claims arising under or
pursuant to the Severance Agreement between Maverick and Xxxxxxxxx dated
November 11, 1998 (the “Severance Agreement”), any and all claims arising under
or pursuant to common law. Xxxxxxxxx expressly waives the benefit of any statute
or rule of law, which, if applied to this Agreement, would otherwise exclude
from its binding effect any claims not known by Xxxxxxxxx to exist. Xxxxxxxxx
also agrees that he will not institute any claims for damages or for other
relief by charge or otherwise, nor will he authorize, encourage, or induce any
other person or entity, governmental or otherwise, to enter into any claim for
damages or for other relief via administrative or legal proceedings against
Maverick and/or any of its parents, affiliates, subsidiaries, or related
companies or any of their officers, directors, agents, representatives or
employees for any such claims and should he do so he will immediately tender
back all amounts paid him under this Agreement. Xxxxxxxxx further relinquishes
all claims and rights to shares of Maverick common stock awarded to Xxxxxxxxx
under Maverick’s 2004 Omnibus Stock Plan. Notwithstanding the foregoing, the
release set forth in this paragraph 9 shall not be applicable to or in any way
affect the representations, warranties and obligations of Maverick hereunder and
the remedies of Xxxxxxxxx with respect thereto.
10. Release
of Claims by Maverick.
In
consideration of the stipulations and covenants made hereunder, Maverick, with
the intent of binding itself and its successors, heirs, assigns, and, hereby
releases and forever discharges Xxxxxxxxx and his successors, heirs, agents,
attorneys, representatives and employees from and against any and all matters,
claims, charges, demands, causes of action, debts, liabilities, controversies,
judgments, grievances and suits of every kind whatsoever, including any claims
for actual
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or
punitive damages, costs and attorney fees, which first arose prior to and
through the date on which this Agreement is executed, including but not limited
to any and
all other statutes or ordinances, any and all claims arising under or pursuant
to the Severance Agreement between Maverick and Xxxxxxxxx, and any and all
claims arising under or pursuant to common law. Maverick expressly waives the
benefit of any statute or rule of law, which, if applied to this Agreement,
would otherwise exclude from its binding effect any claims not known by Maverick
to exist. Maverick also agrees that it will not institute any claims for damages
or for other relief by charge or otherwise, nor will it authorize, encourage, or
induce any other person or entity, governmental or otherwise, to enter into any
claim for damages or for other relief via administrative or legal proceedings
against Xxxxxxxxx and/or any of his successors,
heirs, agents, attorneys, representatives and employees for any
such claims. Notwithstanding the foregoing, the release set forth in this
paragraph 10 shall not be applicable to or in any way affect the
representations, warranties and obligations of Xxxxxxxxx hereunder and the
remedies of Maverick with respect thereto.
11. Legal
Compliance.
Notwithstanding anything contained within this Agreement to the contrary,
Maverick and Xxxxxxxxx shall not be precluded by any term or provision of this
Agreement from taking action that, in the opinion of their respective counsel,
is required in order to comply with the applicable laws. The Parties agree that
either party’s taking such action shall not be deemed a violation of this
Agreement and shall not form the basis for a breach of contract
action.
12. Representation
of Corporate Authority to Enter in this Agreement. Maverick
represents and warrants that it enters into this Agreement pursuant to the
authority of its board of directors after duly convening in accordance with its
by-laws and
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articles
of incorporation. The person signing this Agreement for Maverick represents and
warrants that he or she has been authorized to do so and to bind Maverick
thereby.
13. Divisibility. If any
one or more of the provisions contained in this Agreement shall for any reason
be held to be excessively broad as to time, geographical scope, activity or
subject, it shall be construed by limiting and reducing it so as to be
enforceable to the extent compatible with the applicable law.
14. Severability. If any
one or more provisions contained in this Agreement or any application thereof
shall be invalid, illegal, or unenforceable in any respect, the validity,
legality or enforceability of the remaining provisions of this Agreement and any
other application thereof shall not in any way be affected or impaired.
15. Miscellaneous
Provisions.
(a) Non-Waiver. Either
party’s failure to exercise a right provided for under this Agreement in the
event of a breach by the other of any term hereof shall not be construed as a
waiver of such breach or prevent the party not so acting from thereafter
enforcing strict compliance with any and all terms of this Agreement.
(b) Binding
Effect. This
Agreement is binding upon and shall inure to the benefit of Maverick, its
successors and assigns and Xxxxxxxxx, Xxxxxxxxx’x heirs, executors,
administrators and legal representatives.
(c) Assignment. This
Agreement may be assigned by Maverick (but not Xxxxxxxxx) and Xxxxxxxxx’x
successors and assigns. Xxxxxxxxx consents to any such assignment.
(d) Modification. This
Agreement sets forth the full and complete understanding of the parties, and any
prior agreement oral or written, regarding the matters contained within this
Agreement are null and void. Any amendments to this Agreement must be in writing
and signed by the Maverick’s Chief Executive Officer and Xxxxxxxxx.
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matters
contained within this Agreement are null and void. Any amendments to this
Agreement must be in writing and signed by the Maverick’s Chief Executive
Officer and Xxxxxxxxx.
(f) Governing
Law. This
Agreement shall be deemed for all purposes to have been made in the State of
Missouri and shall be governed by and construed in accordance with the laws of
the State of Missouri, notwithstanding either the place of execution of this
Agreement, nor the performance of any acts in connection with or under this
Agreement in any other jurisdiction.
(g) Consent
to Jurisdiction and Venue. Any
dispute related to this Agreement or its application or enforcement, either at
law or in equity, shall be brought and resolved only in either the United States
District Court for the Eastern District of Missouri or the Circuit Court for St.
Louis County, Missouri. Xxxxxxxxx hereby specifically waives any right that he
may have to challenge or oppose the personal jurisdiction or venue of those
courts.
(h) Opportunity
to Review. Xxxxxxxxx
acknowledges that he has been given adequate time to review this Agreement, that
he has in fact reviewed this Agreement with an attorney who negotiated
provisions of this Agreement on his behalf, and that he
understands the meaning and effect of each paragraph of this
Agreement.
[Remainder
of page intentionally left blank; signature page to follow]
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IN
WITNESS WHEREOF, Xxxxxxxxx and Maverick have executed this Agreement as of the
date set forth above.
|
XXXXX
XXXXXXXXX |
|||
|
/s/
Xxxxx Xxxxxxxxx |
By |
/s/
C. Xxxxxx Xxxxx | |
|
Name |
C.
Xxxxxx Xxxxx | ||
|
Title |
President | ||
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